Case: East India Hotels Limited Vs. Syndicate Bank

KASLIWAL, J. Special leave granted 2. This appeal is directed against the judgment of the Bombay High Court dated November 6, 1990 whereby a suit filed by the Syndicate Bank under Section 6 of the Specific Relief Act, 1963 (hereinafter referred to as the Act) has been decreed 3. The East India Hotels Ltd. (hereinafter referred to as the Company) took a loan of Rs 30 lakhs from the Syndicate Bank. By an agreement dated December 27, 1974 the amount of Rs 30 lakhs was advanced to the company on interest at the rate of 12.5 per cent per annum and the amount was repayable in ten years. The Syndicate Bank executed a leave and licence agreement in favour of the company in respect of 15, 000 sq. ft. on the mezzanine to the ground floor of the hotel Oberoi Towers situated at Nariman Point, Bombay on a monthly compensation of Rs 60, 000 per month, belonging to the company, for a period of 12 years. The leave and licence agreement inter alia provided that at the end of the said period of 12 years, the company shall, on the application of the licensee in writing, renew the licence for another period of 12 years if the company so deems fit on the terms and conditions to be mutually agreed upon. Admittedly the company repaid the entire loan and interest within the scheduled period. The company by a letter dated September 17, 1984 reminded the bank that the agreement was going to expire on December 31, 1986. The company also stated that as they were cramped for space, the bank should vacate the premises at the end of the term. The company by another letter dated April 18, 1986 again requested the bank to vacate the premises by the end of December 1986. The bank by its letter dated July 8, 1986 requested the company that the period of license may be renewed for a further period of 12 years. The company by its letter dated August 9, 1986 informed the bank that the request for renewal of licence was not acceptable and again requested the bank to hand over vacant possession on the expiry of the term. The bank did not hand over vacant possession of the premises even after December 1986 and sent the monthly compensation to the bank (sic company). The company did not accept the amount nor acquiesced in the continuance of possession of the bank after the expiry of the period of licence which came to an end on December 31, 1986. Some correspondence went on between the parties but the company did not agree for the extension of the period of licence. The company ultimately served a legal notice through their advocate on January 22, 1990 calling upon the bank to hand over vacant possession. The bank through their advocates sent a reply dated February 12, 1990 stating as under"I am gathering necessary instructions in the matter and shall revert to you with my clients reply within a reasonable timeIn the meantime, I am instructed to state that my clients did not admit any of the contentions raised by your clients in your letter." *4. On April 12, 1990 a fire broke out in Oberoi Towers and as a result of which not only the bank but all the other shop owners had to vacate the premises. Thereafter, again some correspondence took place between the parties but the only circumstance necessary to be mentioned is that the bank started functioning its business at another place but its papers, furniture, fixtures etc. continued to remain in the premises. Initially the company permitted the staff of the bank to visit the premises on three days in a week but subsequently with effect from July 1990 the company did not permit them to enter the premises at all. In the above circumstances the bank filed a suit under Section 6 of the Act on August 29, 1990 on the original side of the Bombay High Court. The company filed a written statement and contested the suit. A notice of motion was issued for interim reliefs and it reached for hearing on November 1, 1990. On that date after the arguments of Mr Tulzapurkar, learned counsel for the plaintiff bank were over, Mr Nariman appearing for the defendant company made a "without prejudice offer" that he was prepared to treat the hearing of the notice of motion as a trial of the suit. He further stated that for the purposes of the suit the defendants were willing to proceed on the footing that the plaintiffs had been dispossessed as alleged in the plaint. In view of this statement, it was agreed between the parties that the hearing of the notice of motion be treated as the hearing of the suit. Thereafter, the arguments were heard and the suit was decreed by judgment dated November 6, 1990. Aggrieved against the judgment the defendant company has come in appeal to this Court 5. The High Court framed the following two issues (1) Whether the suit by the plaintiffs under Section 6 of the Specific Relief Act, is not maintainable ? (2) If issue No. 1 is answered in favour of the plaintiffs, whether the plaintiff is entitled to any relief, if so what ? The High Court after considering the various authorities held that the plaintiff bank was no doubt a licensee but even after the expiry of the licence period it cannot be dispossessed otherwise than in due course of law and the plaintiff being in settled possession for a long time, was entitled to file a suit under Section 6 of the Act. However, it would be important to note that though the High Court decreed the suit but looking to the facts and circumstances of the case observed as under "However, before I decree the suit, in my view, it is necessary to state that, in my view it is time that courts take note of the reality existing today. Unfortunately litigation takes as inordinately long time. A large number of people are taking advantage of this inordinate delay by remaining in possession without any right, title or interest. The law being what is set out hereinabove, the true owners who are entitled to the properties, and who should by all rights get back the properties, are through no fault of theirs deprived of their property during the period that it takes for cases to be decided. In cases of private citizens, questions do arise as to whether they were compelled (may be by circumstances beyond their control) to enter into agreements, which do not reflect the true nature of transaction. However, this would not be so in cases of big corporations and/or public bodies who have no financial constraints; who have proper legal advice and who enter into agreements knowing fully well what the purpose of the agreement is. It is therefore most unfortunate that big corporations and public bodies who should be setting examples to others, are taking advantage of delays of litigation and not abiding by their commitments, entered into with full knowledge of what the commitments were. Whilst I am bound to uphold the law as it stands today, this reality cannot be ignoredIn the present case, it is admitted that the agreement dated December 27, 1974 is a licence agreement. Plaintiffs claim is that they by their letter dated July 8, 1986 had applied for renewal of the licence. Voluminous correspondence has been exchanged between the parties. At no stage in the correspondence have the plaintiffs claimed that the licence has continued and/or that they have any right to remain in the property. In fact as seen from the minutes of the meeting held on July 5, 1988 all that the plaintiffs requested was that they be allowed to retain one-third of the premises i.e. 5000 sq. ft. The plaintiffs have continued to occupy the premises and it is only for the first time in this suit that they have claimed that the licence had been renewed by their letter dated July 8, 1986. As set out earlier it is not for this Court, trying a suit under Section 6 to decide merits. However, prima facie at least, the conduct of a public body like the plaintiffs appears unsupportable Section 6 of the Specific Relief Act itself provides that a person having title in the land can file a suit for possession based on his title. In my view, this is the course which the defendants must adopt. Therefore, whilst relief cannot be denied to the plaintiffs, some opportunity must be given to the defendants to obtain such orders as they may be advised to protect their rights in the property Under these circumstances, there will be a decree in favour of the plaintiffs and against the defendants in terms of prayers (a) and (b) of the plaint. However, the decree insofar as it relates to handing over to the plaintiffs possession of the suit premises viz. the mezzanine floor of hotel Oberoi Towers, Nariman Point, will be stayed for a period of 10 (ten) weeks from today. There will be no order as to costs of the suitI clarify that the observations which I have made above regarding the conduct of the plaintiffs are mere prima facie observations. I have not considered the merits of the rival claims between the parties. The court which will be considering the defendants case will undoubtedly ignore these observations for the purpose of considering what reliefs should be granted to the defendants." 6. We have heard learned counsel for both the parties and have perused the record thoroughly. There can be no manner of doubt that Section 6 of the Act provides for a summary remedy to any person dispossessed without consent, otherwise than in due course of law and such person is entitled to recover possession by filing a suit before the expiry of six months from the date of dispossession. The Court in a suit filed under Section 6 of the Act will not go into the question of title. However, in a case where the title is not in dispute and the position of the plaintiff who brings such suit is also admitted as that of a licensee continuing in possession after the expiry of period of licence, then the court is certainly entitled to decide as to whether plaintiff is entitled to a decree for possession or not. If the plaintiff disputes any agreement between the parties or raises a dispute that he was a lessee under the terms of the agreement then the Court will find out the intention of the parties and which would be a question of fact depending upon the various factors and circumstances of the case. However, so far as the present case is concerned it is an admitted case of the plaintiff that the agreement dated December 27, 1974 was an agreement of leave and licence and in the plaint also it came with a definite case of licensee and not lessee. The question of finding out the intention of the parties does not arise in the present case inasmuch as it is an admitted case in the plaint itself that the plaintiff bank was in occupation of the premises as a licensee. It is well settled that the plaintiff cannot be allowed to go against its own pleadings and the case as set up in the plaint. The agreement which is an admitted document also shows in unmistakable terms that it was an agreement of leave and licence. The High Court also has held that the plaintiff was a licensee in the premises and the period of licence had expired on December 31, 1986 and thereafter the company had not allowed any extension of the period of licence. It is also an admitted position in the case that the period of licence though had come to an end on December 31, 1986 but the company never took law into its own hands much less used any force in order to dispossess the bank from the premises. The company in a lawful manner served a legal notice asking the bank to vacate the premises on or before December 31, 1986. The company acted in a lawful manner and the bank though bound to hand over possession of the premises to the company before December 31, 1986, continued to remain in unlawful possession as a trespasser. A fire then broke out on April 12, 1990 without any fault of any party and which compelled the bank to close its business and to vacate the premises for all practical purposes and to start the business elsewhere. The case of the bank as set up in para 8 of the plaint reads as under "The plaintiffs submit that there was a fire in the Oberoi Towers on April 12, 1990 as a result whereof some of the equipment, furniture and records etc. of the plaintiffs were partially damaged. After the fire on April 12, 1990, the defendants gave permission to the plaintiffs and other shop keepers in the shopping arcade to enter their respective premises two or three times in a week. However, since about the third week of May 1990 the defendants permitted the plaintiffs representatives to enter their premises on every Monday, Wednesday and Friday of the week." * Thus according to plaintiffs own showing as a result of fire in the Oberoi Towers on April 12, 1990 some of the equipment, furniture and records of the plaintiffs were partially damaged. After this fire the plaintiffs as well as other shopkeepers in shopping arcade were permitted to enter the premises on every Monday, Wednesday and Friday of the week. This clearly goes to show that the bank was not doing any business in the premises on or after April 12, 1990 and in this manner had to vacate the suit premises on account of fire as the premises were no longer fit for continuing any business by the bank. Thereafter, according to the plaintiffs a new lock was fixed by the company on the main entrance in July 1990 and thereafter did not permit the officials of the bank to enter the premises. The plaintiff bank wrote a letter to the company on May 26, 1990. The aforesaid letter is reproduced in extenso "As you are aware due to the fire which took place in the ground floor of your building on April 12, 1990 at 10 p.m., we had also to vacate our premises in the first floor of the building where our International Division is housed. During fire-fighting operations, our office premises including furniture, fixtures, computer system, files and records have also been damaged by splashing of water, smoke and carbon soot. We have drawn up contingency plan and our various departments are now temporarily housed in different premises at Nariman Point and Cuffee ParadeThis plan for immediate functioning of our departments has been drawn up for a period of three months. As we have to take necessary action for re-functioning our office, we request you to give us possession of our premises at the first floor at the earliest. In case it takes some more time to give possession please indicate us the probable time by which you can give the premises to us so that we can draw necessary programme accordingly In the meantime, as our documents and records are kept in premises and we require verification of these records on a day to day basis, we would like to post a few of our staff members on a permanent basis at our office premises with immediate effect. As such, we request you to give power connection and other facilities to the premises on at least temporary basis We request you to inform us in the matter at the earliest." Thus the contents of the above letter clearly go to show that on account of fire which took place on April 12, 1990 the bank had itself vacated the premises and had lost possession of the suit premises 7. There is a controversy between the parties as to how the key was given by the plaintiff bank to the company but it is an admitted position that no force was applied in doing so. On the above admitted facts of the case, the important question which calls for consideration in the present case is whether in the circumstances mentioned above the plaintiff is entitled to get any decree for possession under Section 6 of the Act. We have no hesitation in holding that the purpose behind Section 6 of the Act is to restrain a person from using force and to dispossess a person without his consent otherwise than in due course of law. In the present case in our view the plaintiff has not been dispossessed by using any force. Admittedly the bank is a licensee and the period of such licence came to an end on December 31, 1986 and thereafter its possession was that of a trespasser. On account of fire having broken out on April 12, 1990 the bank had to stop its business and in fact it has started its business at some other place. In case the intention of the company would have been to dispossess the bank by force, it could have done so soon after the expiry of the period of licence, but admittedly nothing was done for more than three years till the fire broke out on April 12, 1990. The question now is whether the plaintiff bank who is admittedly a licensee and having become a trespasser after December 31, 1986 could claim recovery of possession against the owner 8. The only prohibition under the provisions of Section 6 of the Act is not to use force and not to use any unlawful means for dispossessing a person. Both these circumstances are taking in the present case. The ratio of the decided cases is that the Court in trying a suit under Section 6 of the Act will not go into the question of title. There cannot be any dispute with this settled proposition. However, in the present case the title of the company as well as the position of the plaintiff bank that its possession was as a licensee is an admitted case 9. Our answer in these circumstances is that the plaintiff being a licensee and having become a trespasser after December 31, 1986 has no right to claim possession from the company who is admittedly the owner of the premises 10. Even otherwise to grant or not to grant relief under the Specific Relief Act lies in the judicial discretion of the Court. I am thus clearly of the view that in the facts and circumstances of the case which are admitted, the plaintiff bank is not entitled to any decree under Section 6 of the Act 11. If we look at the matter from another angle, the High Court itself has made the observations that it was most unfortunate that big corporations and public bodies (the Syndicate Bank here) who should be setting example to others, are taking advantage of delays of litigation and not abiding by their commitments, entered into with full knowledge of what the commitments were. Not only that the High Court indirectly suggested the defendant company to file a suit for possession based on title and in the view of the High Court this was the course which the defendants must adopt. The High Court further observed that while relief cannot be denied to the plaintiffs, some opportunity must be given to the defendants to obtain such orders as they may be advised to protect their rights in the property. We are told that after the decision of the High Court the company has already filed a suit for permanent injunction on the basis of title restraining the bank from obtaining possession and an application for temporary injunction has also been filed for an interim relief. That being the position the result of granting any decree in this litigation under Section 6 of the Act would not serve the ends of justice and at the same time it would unnecessarily prolong litigation between the parties which would be a waste of public money as well as the valuable time of the courts. We cannot lose sight of the fact that the plaintiff bank is an instrumentality of the State and it should honour its commitments and not indulge in futile litigation at the cost of public money 12. The cases cited at the bar do not deal with the situation and circumstances as arising in the case in hand before us. Those cases deal with tenants holding over after the expiry of the term of lease and such possession after holding over is entirely different from the case of a licensee remaining in occupation after the expiry of the term of licence. The position of such licensee is not better than a trespasser and if the true owner comes into possession of the premises without using any force or on account of fire or other act of vis major, in my view it would not be in the interest of justice to grant a decree for possession in favour of such licensee under Section 6 of the Act 13. The criminal cases dealing with the question of right of private defence allowed to a trespasser dispossessed by force will not lend any assistance in deciding the present case 14. In Lallu Yeshwant Singh v. Rao Jagdish Singh [ 1968 (2) SCR 203 : 1968 AIR(SC) 620 ] (at SCR p. 208) this Court cited with approval the following observations made by Chagla, C.J. in K. K. Verma v. Union of India 1954 ILR(Bom) 950: 1954 AIR(Bom) 358 ] "Under the Indian law the possession of a tenant who has ceased to be a tenant is protected by law. Although he may not have a right to continue in possession after the termination of the tenancy his possession is juridical and that possession is protected by statute. Under Section 9 of the Specific Relief Act a tenant who has ceased to be a tenant may sue for possession against his landlord if the landlord deprives him of possession otherwise than in due course of law, but a trespasser who has been thrown out of possession cannot go to court under Section 9 and claim possession against the true owner." * In the above passage it has been clearly observed that a trespasser who has been thrown out of possession cannot go to court under Section 9 of the Specific Relief Act (now Section 6 of the Specific Relief Act, 1963) and claim possession against the true owner 15. Anther case, very near to the facts of the case in hand, decided by a bench of three Judges of this Court is D. H. Maniar v. Waman Laxman Kudav [ 1976 (4) SCC 118 : 1977 (1) SCR 403 ]. It was held in the above case that a person continuing in possession of the premises after termination, withdrawal or revocation of the licence continues to occupy it as a trespasser or as a person who has no semblance of any right to continue in occupation of the premises. Such a person cannot be called a licensee at all 16. Thus in my view the plaintiff bank in the facts and circumstances of the present case is not entitled to any decree under Section 6 of the Act.

Decision reasoning: 1[ds]It is well settled that the plaintiff cannot be allowed to go against its own pleadings and the case as set up in the plaint. The agreement which is an admitted document also shows in unmistakable terms that it was an agreement of leave and licence. The High Court also has held that the plaintiff was a licensee in the premises and the period of licence had expired on December 31, 1986 and thereafter the company had not allowed any extension of the period of licence. It is also an admitted position in the case that the period of licence though had come to an end on December 31, 1986 but the company never took law into its own hands much less used any force in order to dispossess the bank from the premises. The company in a lawful manner served a legal notice asking the bank to vacate the premises on or before December 31, 1986. The company acted in a lawful manner and the bank though bound to hand over possession of the premises to the company before December 31, 1986, continued to remain in unlawful possession as aclearly goes to show that the bank was not doing any business in the premises on or after April 12, 1990 and in this manner had to vacate the suit premises on account of fire as the premises were no longer fit for continuing any business by the bank. Thereafter, according to the plaintiffs a new lock was fixed by the company on the main entrance in July 1990 and thereafter did not permit the officials of the bank to enter the premises. The plaintiff bank wrote a letter to the company on May 26, 1990. The aforesaid letter is reproduced inthe present case in our view the plaintiff has not been dispossessed by using any force. Admittedly the bank is a licensee and the period of such licence came to an end on December 31, 1986 and thereafter its possession was that of a trespasser. On account of fire having broken out on April 12, 1990 the bank had to stop its business and in fact it has started its business at some other place. In case the intention of the company would have been to dispossess the bank by force, it could have done so soon after the expiry of the period of licence, but admittedly nothing was done for more than three years till the fire broke out on April 12, 1990. The question now is whether the plaintiff bank who is admittedly a licensee and having become a trespasser after December 31, 1986 could claim recovery of possession against thecannot be any dispute with this settled proposition. However, in the present case the title of the company as well as the position of the plaintiff bank that its possession was as a licensee is an admittedEven otherwise to grant or not to grant relief under the Specific Relief Act lies in the judicial discretion of the Court. I am thus clearly of the view that in the facts and circumstances of the case which are admitted, the plaintiff bank is not entitled to any decree under Section 6 of theare told that after the decision of the High Court the company has already filed a suit for permanent injunction on the basis of title restraining the bank from obtaining possession and an application for temporary injunction has also been filed for an interim relief. That being the position the result of granting any decree in this litigation under Section 6 of the Act would not serve the ends of justice and at the same time it would unnecessarily prolong litigation between the parties which would be a waste of public money as well as the valuable time of the courts. We cannot lose sight of the fact that the plaintiff bank is an instrumentality of the State and it should honour its commitments and not indulge in futile litigation at the cost of publicposition of such licensee is not better than a trespasser and if the true owner comes into possession of the premises without using any force or on account of fire or other act of vis major, in my view it would not be in the interest of justice to grant a decree for possession in favour of such licensee under Section 6 of theThus in my view the plaintiff bank in the facts and circumstances of the present case is not entitled to any decree under Section 6 of the Act.