- 1 - IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION WRIT PETITION (L) NO.1410 OF 2008 1. Mr.Bharat Sheth, ) 2. Mr.Pinank Sheth, ) 3. M/s.Dushyant Agencies Private ) Limited, a company Registered ) under the Indian Companies Act, ) 1956 having its registered ) Office at B/3, Jagdish Apartment,) Military Road, Marol, ) Andheir (East), Mumbai-400 059. ) And having its manufacturing ) Workshop-cum-factory in two ) Independent Industrial Galas ) Vs. Municipal Corporation of Greater Mumbai & Ors. .. Respondents -- Sarvasri Nusrat Shah along with A.K.Gupta and Mrs.Ima Almeida, Sri Maqsood Ansari and Sri V.A.Almeida i/b Smt.N.N.Shah for the petitioners. Shri A.Y.Sakhare, Senior Counsel along with Smt.Archana Joshi for the Respondent Nos.1 to 3. Shri Anil C.Singh alongwith Anil Yadav i/b D.R.Shah for the Respondent Nos.8 to 10. Shri D.A.Nalawade, Govt.Pleader for the Respondent No.11. -- CORAM : SRI R.M.S.KHANDEPARKAR & SRI A.A.SAYED, JJ DATED : 21ST JULY, 2008 - 2 - ORAL ORDER : ( Per R.M.S.Khandeparkar, J) ORAL ORDER : ( Per R.M.S.Khandeparkar, J) ORAL ORDER : ( Per R.M.S.Khandeparkar, J) 1. Heard. By the present petition, the petitioners are seeking reliefs against the respondents in the nature of direction to issue trade licence for the activities which the petitioners want to carry out in the suit premises without insisting for ‘No Objection Certificate’ from the landlord or the Society as also direction to the respondents not to disconnect electricity and water supply and to take appropriate steps to remove the seal affixed to the suit premises by the Collector during the pendency of the petition. 2. The learned advocate appearing for the petitioners, taking us through the petition and the annexures thereto, submitted that the premises have been lawfully let out to the petitioners by the respondent landlord and though the agreement is in the nature of licence for eleven months, it is absurd to presume that anybody will take up the premises for licence for eleven months. In relation to a trade licence in terms of Section 394 of the Mumbai Municipal Corporation Act, 1888, for short "the said Act", the Corporation can only ascertain whether the - 3 - applicants are in exclusive possession or not and the Corporation cannot decide the status of the Applicants vis-a-vis the premises in relation to which the licence is applied for. The attention is drawn to a decision of the Learned Single Judge in the matter of M.G.Sarasappa Kurup v. Municipal Corporation of M.G.Sarasappa Kurup v. Municipal Corporation of M.G.Sarasappa Kurup v. Municipal Corporation of Greater Bombay, Greater Bombay, Greater Bombay, reported in AIR 2001 Bombay 281. 3. On the other hand, the learned advocates for the respondents submitted that the licence granted to occupy the premises expired on 15th September, 2007 and there is already a suit filed for eviction of the petitioners in the Small Causes Court. There are also proceedings taken out by the petitioners against the licensor seeking certain reliefs in the matter in relation to the premises. It is further contention on behalf of the respondents that already in two of the matters, the petitioners were prosecuted for non-compliance of the statutory provisions of the said Act and having pleaded guilty, penalty has been levied by the Court. One more case is still pending against the petitioners. The attention is also drawn to Section 390 of the said Act. 4. The main grievance of the petitioners is that the Corporation is unnecessarily and arbitrarily - 4 - insisting for N.O.C. from the landlord for grant of necessary licence in relation to the premises in question, when the provision of law does not empower the Corporation to reject the application for such licence mainly on the ground of absence of N.O.C. from the landlord. 5. In M.G.Sarasappa Kurup’s case (supra) M.G.Sarasappa Kurup’s case (supra) M.G.Sarasappa Kurup’s case (supra), while dealing with the question whether the Corporation while ascertaining whether the applicant is in exclusive possession of the premises in relation to which the licence is applied for, can insist for NOC from the owner of the premises, it was held by the learned Single Judge thus:- "I find that the Small Causes Court has virtually treated the appeal as if it was deciding the issue as to the title of the petitioner with regard to the suit premises. In my view, this cannot be the scope of inquiry in the proceedings which are for the limited purpose for seeking permission for storage of certain notified articles in the premises. In such matters, the inquiry should be restricted as to whether the applicant is in physical possession of the suit premises - 5 - for which permission for storage of articles is sought. It is wholly irrelevant as to whether the applicant is either owner of the premises or a lawful tenant. So long as there is no declaration by a Court of competent jurisdiction with regard to the determination of relationship of landlord and tenant or that the applicant is in unauthorised occupation or a trespasser in respect of the premises or that the premises are unauthorised or an encroachment, the Commissioner cannot assume to himself the role of deciding the title and make the basis for refusing the permission sought for storage of notified articles. This is the only interpretation that can be given to Section 394 of the Act inasmuch as sub-section (4) thereof postulates that the Commissioner shall examine whether the storage of articles is dangerous or likely to create nuisance and if he is satisfied that the same is dangerous or likely to cause nuisance, he may issue notice for taking remedial steps to the occupant of the premises. The section requires that the notice is to be given to the person keeping the articles or suffer or allow to be kept in or upon any premises any trade, - 6 - process or operation or allowing it to be carried out as the case may be. From the language of this section, it is absolutely clear that the proposed action under sub-section (4) is to be directed only against the person who has stored articles for carrying on the business." 6. With utmost respect, we are unable to agree with the view taken by the Learned Single Judge in the said decision. Section 394(4) of the said Act provides that "If it appears to the Commissioner that the keeping of any article or animal or the carrying on of any trade, process or operation, in or upon any premises, is dangerous or likely to create a nuisance within the meaning of clause (d), or paragraph (ii) of clause (e), of sub-section (1), the Commissioner may, by written notice, require the person keeping the article or animal or suffering or allowing it to be kept or the person carrying on the trade process or operation or allowing it to be carried on, as the case may be, to take such measures including discontinuance of the use of the premises for any such purpose as may be specified by him in such notice in order to prevent such danger or nuisance; and if such measures are not taken within the specified time, the Commissioner may - 7 - seize and carry away or seal such article or animal or any machinery or device used in connection with such trade, process or operations. Any article or animal or machinery or device so seized and carried away or sealed may be redeemed, within a period of one month from the date of seizure, on payment of such sum and subject to such conditions as to future use or disposition of such article for animal, machinery or device as may be fixed by the Commissioner in that behalf." 7. Plain reading of Sub-section (4) of Section 394 of the said Act, undoubtedly, discloses the power of the Commissioner to take appropriate steps in relation to any trade, process or operation which is either dangerous or is likely to create a nuisance. Undoubtedly, nuisance has been specified to be within the meaning of the clause (d), or clause (e)(ii) of Sub-section (1) of Section 394 of the said Act. The scope of sub-section (4) relates to the power of Commissioner to take appropriate step to avoid dangerous effects of any trade, process or operation or any nuisance being created on account of such trade, process or operation in any building. However, it does not mean that the Corporation has no authority to ascertain as to whether the person or the firm - 8 - applying for licence to carry any trade, process or operation has lawful right to occupy the premises for the purposes of carrying out any such trade, process or operation. If such a verification is not allowed to be done by the Corporation before grant of licence, it would virtually lead to a conclusion that even a trespasser can apply for licence for carrying out any trade, process or operation in any building and any such interpretation of Section 394 of the said Act may have disastrous results. 8. It is to be noted that Section 394(4) of the said Act does not require interpretation as such, as it clearly speaks of the power of Commissioner to take appropriate steps in order to avoid dangerous effects of any trade, process or operation or any nuisance being created on account of such trade, process or operation in any building. And, if at all it is required to be interfered then it should not be forgotten that no unlawful occupant of the premises can be encouraged by the Corporation to carry out trade, process or operation in such premises. 9. Section 394(5) clearly provides that it shall be at the discretion of the Commissioner to grant any licence referred to in sub-section (1), subject to - 9 - such restrictions or conditions, if any, as he shall think fit to specify, or for the purposes of ensuring public safety, to withhold any such licence. Exercise of such discretionary power would obviously imply power to the Commissioner to inquire and verify whether the circumstances prevailing at the site are either of such a nature that it would be dangerous to permit the applicant to carry on any particular trade, process or operation or that it would create a nuisance, including from the point of view of the public safety. Such an inquiry would obviously include the inquiry to ascertain whether the action of the public body in granting licence would result in permitting any illegality being committed by the applicant. 10. It is also to be noted that the Mumbai Municipal Corporation Act makes it obligatory for the Corporation to have adequate provision, by any means and measures, which it can lawfully adopt to use or to take in relation to any construction, maintenance and cleansing of drains and drainage works, and of public latrines, urinals and similar conveniences, planning for economic and social development, urban forestry, protection of environment and promotion of ecological aspects, the construction and maintenance of works and - 10 - means for providing a supply of water for public and private purposes, to regulate offensive and dangerous trades, to secure or remove of dangerous building and places, etc. amongst other things enumerated under Section 61 of the said Act. 11. Section 140 of the said Act empowers the Corporation to levy taxes on the buildings and lands and Section 146 thereof speaks of primary responsibility regarding the payment of the property taxes so levied by the Corporation. Sub-section (1) thereof provides that property taxes shall be recoverable primarily from the actual occupier of the premises upon which the said taxes are assessed, if such occupier holds the said premises immediately from the Government or from the Corporation or from a Fazendar, and are occupied by a government servant or any other person on behalf of the government for residential purposes, the liability to pay shall rest primarily upon the Government and not the occupier thereof. Sub-section (2) specifically provides that otherwise the said taxes shall be primarily recoverable, namely, if the premises are let, from the lessor; if the premises are sub-let, from the superior lessor; and if the premises are unlet, from the person in whom the right to let the same vests. - 11 - In other words, while levying taxes, the Corporation is entitled to know to whom the property belongs to, whether the property is let out by the owner, and if so, to whom, as well as the quantum of rent for which it is let out. The primary liability being either of the owner, or lessor, or in case of subletting the superior lessor. The Corporation, therefore, has power to inquire from the applicant applying for trade licence as to whether he has come in occupation by way of lease or sub-lease. 12. The applicant for a licence will have to also disclose quantum of the rent for such premises, if asked for. Under Section 154 of the said Act, in order to fix the rateable value of any building or land assessable to a property-tax, it is required to deduct from the amount of the annual rent for which such land or building might reasonably be expected to let from year to year a sum equal to ten per centum of the said annual rent and the said deduction shall be in lieu of all allowances for repairs or on any other account whatever. In other words, while fixing the rateable value to ascertain the tax liability for a building, it is necessary to know annual rent which the premises can fetch. If the building is actually let out, the said amount of rent could always be a - 12 - factor to be considered by the authority. 13. Considering all the above aspects of the matter, it cannot be said that the Corporation will have no power to know as to whether the applicant applying for licence is in possession as the owner of the premises or as a lessee of the premises, or a sub-lessee. The capacity in which the applicant is occupying the premises in which the applicant desires to carry on the trade, process or operation can certainly be ascertained by the Corporation before issuing or rejecting the licence applied for. It cannot be said that the Corporation is duty bound to grant licence without ascertaining the capacity in which the applicant is occupying the premises. Section 394(5) of the said Act itself empowers the Commissioner to reject the licence for the purpose of ensuring public safety. The expression "public safety" would not necessarily relate to the limitations which are prescribed for rejection of the licence under sub-section (4) of Section 394 of the said Act. The public safety will also include the issue of law and order. Allowing the trespasser to occupy the premises and to carry on business without there being consent from the owner of the premises may give rise to the law and order problem and therefore - 13 - the Corporation cannot be denied of the right to know the status of the applicant vis-a-vis the premises. 14. In the case in hand, it is undisputed fact that the applicant on account of non-obtaining of trade licence and carrying on trade illegally was twice prosecuted and fined, and the said case is pending. It is also undisputed fact that there is a litigation pending between the petitioners and the owner of the premises. In such circumstances, the Respondent-Corporation has refused to issue licence. Unless the Corporation is satisfied about the lawful occupation of the premises by the petitioners, no fault can be found with the said decision on the part of the Respondent Corporation. In the facts and circumstances, if necessary the N.O.C. is insisted from the landlord for grant of licence, then such insistence by the Respondent cannot be said to be an arbitrary action. 15. As regards the action taken for sealing of the premises, undisputedly, a necessary notice in that regard was issued to the petitioners. Besides, there is an appeal provided against such decision and there is no explanation forthcoming from the petitioners for non-exhausting such efficacious alternative remedy - 14 - available to the petitioners in that regard. 16. For the reasons stated above, therefore, we find no case to interfere in the impugned order. The petition, therefore, fails and is hereby dismissed with no order as to costs. ( R.M.S.KHANDEPARKAR, J ) ( A.A.SAYED, J )