HON'BLE MR JUSTICE C.V. RAMULU W. P. No. 10142 of 2006 DATED: 13.10.2009 Between: Narsing Rao Kondle ..... PETITIONER AND 1. The Govt. of A.P. 2. The Chief Commissioner of Land Admn. 3. The Joint Collector, 4. The Estate Officer 5. The Mandal Revenue Officer .....RESPONDENT(S) O R D E R:- This writ petition is filed seeking to quash the Proceedings dated 29.10.2005 issued by the 2nd respondent and the Notice dated 12.01.2006 issued by the 4th respondent, and consequently to direct the respondents to release the freehold rights in respect of the house bearing No.2-4-447 and 449, admeasuring 133.34 Sq. yards, Plot No.75, situated at Nallagutta, Secunderabad, in favour of the petitioner by collecting an amount of Rs.6,40,032/-, as per G.O. Ms. No.816, dated 09.08.1994. The petitioner asserts that he purchased leasehold interest of Plot No.75 admeasuring 133.34 Sq. yards of land situated at Nallagutta, Secunderabad including the structures raised thereon from the original lessee Mukundas Mohallal Malani, under a registered deed dated 28.02.1973. Subsequently, the lease was transferred in his name under the lease deed dated 10.08.1979, and renewed for a period of 30 years commencing from 21.07.1971, and since then, he has been in possession and enjoyment of the same by paying lease amounts regularly. While so, the Government of A.P. issued orders in G.O. Ms. No.816 dated 09.08.1994 for conversion of leasehold rights into freehold rights in Secunderabad area fixing the conversion and registration charges of the Plot at Rs.100/- per Sq. yard. Thus, the petitioner made an application dated 14.07.1996 seeking conversion of leasehold rights into freehold rights by paying Rs.20,000/-, vide challan dated 07.09.1998, but the respondents, on erroneous assumption, without making personal inspection of the property in question, issued Conversion Order dated 24.11.1997 demanding him to pay huge amount of Rs.7,36,037/- on the ground that he was using the property for commercial purpose. Further, he made a representation on 11.12.2003 to the 2nd respondent requesting him to re-examine his case by making personal inspection and to charge at the rate of Rs.100/- per Sq. yard towards conversion charges, but the 2nd respondent, without issuing any notice and without inspecting the property in question, issued Final Notice dated 23.08.2005 directing the petitioner to pay an amount of Rs.14,75,707/- alleging that he was to pay an amount of Rs.7,16,037/-, towards interest and the lease amount, etc. According to the petitioner, the claim made in the Final Notice dated 23.08.2005 is exorbitant and without any basis. The lease was subsisting upto 20.07.2001, but penal interest was calculated from 24.11.1997 i.e. approximately for a period of 4 years and the same was added without any justification. The penal interest could have been charged from the date of fresh orders i.e. 03.11.2003 issued by the 2nd respondent. Therefore, the petitioner made another representation 06.10.2005 to the 2nd respondent requesting to depute some responsible officer to inspect his property by giving him a notice in advance and to re-examine the case and cancel the Final Notice dated 23.08.2005. Now, the petitioner’s grievance is that the 2nd respondent, without considering his representation dated 06.10.2005, issued the impugned proceedings dated 29.10.2005 cancelling the Conversion Order dated 24.11.1997 and directing the 4th respondent to initiate action for termination of lease and resumption of the leased land to the Government under Rule 21(i) and (ii) of A.P. (Secunderabad Area) Land Administration Rules, 1976 (for short “the Act”). Further, the 4th respondent, without initiating any action, without issuing any notice or affording any opportunity and without paying him any compensation for erections and buildings constructed on the leased land, issued Notice dated 12.01.2006 directing him to vacate the premises and handover the same to the 5th respondent, and according to the petitioner, the 5th respondent is threatening him to vacate the premises. The respondents filed counter affidavit stating that the land in question was leased out to the petitioner, and the same was renewed vide lease deed No.4050 dated 10.08.1979 for a period of 30 years with effect from 21.07.1971. On 29.08.1996, the petitioner applied for conversion of leasehold rights into freehold rights, and the Deputy Collector, on 06.01.1997, inspected the land in question and found that the lessee constructed building i.e. Ground + 1st floor in the leased premises without obtaining permission from the competent authority and violated condition No.1(8) of lease conditions by letting it out for commercial purpose. Therefore, proposals were submitted to the Chief Commissioner of Land Administration, A.P. Hyderabad recommending for conversion of lease holdrights to freehold rights subject to payment of following charges as per G.O. Ms.No.816, dated 09.08.1994. 1. Commercial for 133.34 Sq. yards @ 4800/- per Sq. yards .. Rs.6,40,032/- 2. Addl. Compound fee for letting out the entire building for commercial purpose .. Rs. 96,005/- 3. Late fee for regularizing gap period .. Rs. 225/- The Commissioner of Land Revenue, vide Proceedings dated 24.11.1997, accorded permission for mutation and conversion of leasehold rights of the land in question covered under L.D.No.4050 dated 10.8.1979 into freehold rights in favour of the petitioner subject to full payment of Rs.7,36,037/- towards conversion charges treating that the entire area is under commercial use. Accordingly, Notices dated 25.3.1998 & 11.8.1998 were issued to the lessee demanding him to pay conversion charges, but the lessee remitted only Rs.20,000/- vide challan dated 07.09.1998. After a lapse of six months, further Notice dated 18.07.2001 was issued for payment of balance amount of Rs.7,16,037/-. The Chief Commissioner of Land Administration, after examining the request of the petitioner, rejected his representation, vide his proceedings dated 03.11.2002, which were served on the petitioner on 15.11.2003. In spite of issuing several notices for remitting the conversion charges even after rejecting his request, the lessee has failed to remit the balance conversion charges in addition to the following payments as per the Final Notice dated 23.08.2005 issued by the Estate Officer. Balance amount of conversion charges .. Rs.7,16,037/- Lease rent from 20.7.2001 to 31.5.2005 .. Rs. 89,876/- Penal interest @ 1% P.M. w.e.f. 24.11.1997 to 31.5.2005 .. Rs.6,69,794/- ___________ Total Rs.14,75,707/- ____________ As the conversion charges are not paid by the petitioner within a period of six months from the date of conversion orders dated 24.11.1997, the 2nd respondent-Chief Commissioner of Land Administration, vide impugned Proceedings dated 29.10.2005, cancelled the conversion orders and further directed the Estate Officer to initiate action against the petitioner U/s.21(i) and (ii) of the Rules for termination of lease and resumption of the leased land to the Government. In pursuance of the Proceedings dated 29.10.2005, the Estate Officer, Secunderabad, issued the impugned Notice dated 12.01.2006, directing the petitioner to vacate and handover the possession of the property to the Mandal Revenue Officer. Then, the petitioner filed the present writ petition challenging the proceedings dated 29.10.2005 and the Notice dated 12.01.2006. In pursuance of the order dated 31.5.2006 passed by this Court in W.P.M.P. No.12775 of 2006 in W.P. No.10142 of 2006, the petitioner paid only an amount of Rs.6,50,000/-, vide Challan No.541008, dated 26.6.2006, but failed to pay the amounts as demanded in the Final Notice dated 23.08.2005. Hence, the writ petition is liable to be dismissed. Heard the learned counsel for the petitioner, the learned Government Pleader for Revenue appearing for respondent Nos.1 and 5 and the learned Government Pleader for Assignment appearing for respondent Nos.2 to 4, and perused the material placed on record. The undisputed facts are that the petitioner has been holding leasehold rights of the premises in question since 1971, and when a decision was taken by the Government for conversion of leasehold rights into freehold rights, the petitioner’s premises was inspected and found that it was converted into commercial purpose, and therefore, the Commissioner of Land Revenue calculated the amount of charges on the ground that the leased premises was used for commercial purpose and fixed an amount of Rs.7,36,037/-. However, the petitioner paid an amount of Rs.20,000/- and made a representation requesting the authorities to convert the leasehold rights of the premises in question treating it as used for residential purpose and the amount already paid by him may be adjusted to the same, but that was not accepted by the respondents. The question as to whether the petitioner really used the premises in question for commercial or residential purpose cannot be gone into by this Court in a writ petition like this. However, it appears that the petitioner has not paid the amount in full, and waited for the reply from the respondents to treat the leased premises as residential area for the purpose of conversion of leasehold rights into freehold rights. Therefore, it cannot be said that the amount fixed at Rs.7,36,037/- for the purpose of converting the leasehold rights into freehold rights is arbitrary or illegal. Since the petitioner has not challenged the same at appropriate time, the fact remains that the impugned Final Notice dated 23.8.2005 was issued fixing the liability on the petitioner to pay the conversion charges as follows: Balance amount of conversion charges .. Rs.7,16,037/- Lease rent from 20.07.2001 to 31.5.2005 .. Rs. 89,876/- Penal interest @ 1% p.m. w.e.f. 24.11.1997 to 31.05.2005 .. Rs. 6,69,794/- ____________ Total Rs.14,75,707/- ____________ From the above it is seen that though the rent of the lease was calculated up to 31.05.2005, the penal interest was levied at the rate of 1% from 24.11.1997 to 31.5.2005 making total of penal interest at Rs.6,69,794/-. This part of the order passed by the 4th respondent seems to be arbitrary and illegal. On one hand, the rent for the period from 20.07.2001 to 31.05.2005 was calculated at Rs.89,876/- treating the leased property as commercial premises, and on the other hand the penal interest of 1% p.m. from 24.4.1997 to 31.5.2005 was calculated as Rs.6,69,794/- for the period from 24.11.1997 to 31.05.2005. It must be deemed that when the Final Notice dated 23.08.2005 was issued, the case of the petitioner was considered finally demanding him to pay the balance amount of conversion charges of Rs.7,16,037/-, but the petitioner cannot be mulcted with penal interest of 1% per month with effect from 24.11.1997 to 31.5.2005 and the lease rent of Rs.89,876/-, having the rents already collected properly upto date. Further, the petitioner deposited an amount of Rs.6.50 lakhs in view of the interim orders passed by this Court and also deposited an amount of Rs.20,000/- on 07.09.1997 assuming for himself that it is for residential purpose. Thus, in all, the petitioner paid an amount of Rs.6,70,000/- as on that day. For the foregoing reasons, I am of the opinion that the impugned order dated 29.10.2005 passed by the 2nd respondent canceling the conversion order dated 24.11.1997, and the subsequent impugned Notice dated 21.01.2006 issued by the 4th respondent directing the petitioner to vacate the leased premises and handover the possession of the same to the Mandal Revenue Officer are not justified in view of the fact that the petitioner has been in possession and enjoyment of the same for more than (30) thirty years and has been paying rents regularly as per the orders passed by the respondents, and hence, the impugned order dated 29.10.2005 and the impugned Notice dated 21.01.2006 are liable to be set aside, as arbitrary and illegal. It seems that the petitioner has not paid the amount in full only on the ground that he is made liable to pay the demanded amounts by treating the premises in question as commercial purpose and paid Rs.20,000/- treating it as residential and went on making representations. Thus, the respondents are entitled to collect an amount of Rs.66,037/- (Rs.7,36,037/- minus Rs.6,70,000/-) and the rents, if any to be paid, as on today. Further, the respondents are also entitled to collect interest at the rate of 9% on the amount of Rs.66,037/-from 23.08.2005 till date. The petitioner is directed to pay an amount of Rs.66,037/- along with 9% interest, within a period of two months from the date of receipt of a copy of this order. On payment of such amount, the respondents are directed to issue necessary orders converting the premises from leasehold rights into freehold rights in favour of the petitioner. With the above observations, the writ petition is disposed of. No costs. ______________ C.V.RAMULU, J 13th October, 2009 bcj