Case: Mumbai International Airport Pvt. Ltd Vs. Regency Convention Centra &amp; Hotels

2. The Airport Authority of India (second respondent herein, AAI for short) established under the Airports Authority of India Act, 1994 (`Act for short) to be responsible for the development, operation and maintenance of airports in India. The Government of India took a policy decision to amend the Act by Amendment Act 43 of 2003 enabling the AAI to lease the airport premises, to private operators with prior approval of the Central Government and assign its functions to its lessees except air traffic services and watch and ward. In pursuance of the policy of the government in this behalf, the AAI decided to entrust the work of modernisation and upgradation of the Mumbai Airport to a private operator, to serve the sharply increasing volume of passengers and for better utilisation of the Airport. AAI initiated a competitive bidding process in that behalf. In the information memorandum that was issued to the prospective bidders it was represented that the entire airport premises will be included in the transaction including all encroached land but excluding only the following areas : (i) New ATC tower; (ii) AAI staff colony; (iii) Hotel Leela Venture, and (iv) All retail fuel outlets outside the airport operational boundary3. Pursuant to the competitive bidding process, the Chhtrapati Shivaji International Airport, Mumbai was handed over to the appellant for operation, maintenance, development and expansion into a world class airport under an agreement dated 4.4.2006. In pursuance of it, AAI entered into a lease deed dated 26.4.2006 leasing the Mumbai airport to the appellant on as is where is basis for a period of 30 years. The subject matter of the lease was described as all the land (along with any buildings, constructions or immovable assets, if any, thereon) which is described, delineated and shown in Schedule I hereto, other than (i) any lands (along with any buildings, constructions or immovable assets, if any, thereon) granted to any third party under any existing lease(s), constituting the Airport on the date hereof; and (ii) any and all of the carved out assets. Schedule I to the lease deed, instead of giving a detailed description of the demised property, referred to the map demarcating the demised premises annexed to the lease deed by way of description of the demised premises. The map annexed as Schedule I was the plan showing the demised premises, indicating carved out assets and lands vested with IAF and Navy. The carved out assets were : (1) new ATC tower; (2) & (2A) the NAD staff colony of AAI; (3) land leased to Hotel Leela Venture; (4) all retail fuel outlets which were outside the airport operational boundary; and (5) convention centre. The map also contains a note below the list of carved out assets, reading as under: A : The parcel of land measuring 31,000 sq.mts. is currently not made a part of the lease deed but may become part of the demised premises subject to the court verdict4. According to the appellant the said parcel measuring 31,000 sq.m. was also part of the airport that was to be handed over by AAI to appellant but it could not be included in view of a pending case (Suit No.6846 of 1999 on the file of the Bombay High Court) filed by the first respondent wherein the High Court had made an interim order dated 2.5.2001, relevant portion of which is extracted below :The Defendant Airport Authority should also separately demarcate an area of 31000 sq. meters for which the plaintiff is making a claim in this suit. After the land is so demarcated, a copy of the plan would be handed over to the Plaintiff through their advocate. The learned Counsel further states that the land admeasuring 31000 sq. meters, which would be separately demarcated will not be alienated, sold and transferred and no third party interest in that land would be created by the Defendants Airport Authority without seeking leave of this Court. He further states that the Defendant No.1 would use the 31,000 sq. meters of land only for its own purpose as far as possible without raising any permanent construction on that land, and if it becomes necessary for the Defendant No.1 to raise any permanent construction on that land, the work of construction would not be started without giving two weeks notice to the Plaintiff, after the building plan is finally sanction by the Planning Authority. (emphasis supplied)5. In pursuance of the lease of the airport in its favour, the appellant claims to have undertaken several developmental activities to make it a world class airport. The appellant alleges that it was expecting that the litigation initiated by the first respondent would end and it would be able to get the said 31,000 sq.m. land also as it was in dire need of land for developing the airport. According to the appellant, the Mumbai airport is surrounded by developed (constructed) areas with very limited opportunities to acquire any land and the site constraints limit the possibilities for development and therefore it was necessary to make optimum use of the existing land in the airport for the purpose of modernisation and upgradation; and therefore, the disputed land which was lying idle, was required for modernisation. It therefore filed an application seeking impleadment as an additional defendant in the pending suit filed by the first respondent against AAI, contending that its interest was likely to be directly affected if any relief is granted to the first respondent-plaintiff in the suit. The appellant alleged that the Information Memorandum proposing to privatise the management did not exclude the area which was the subject-matter of the suit; and that the suit plot could not however be leased to the appellant in view of the interim order in the pending suit of the first respondent. The appellant therefore claimed that it had, or would have, an interest in the suit land; and at all events, it was interested in acquiring it by lease depending upon the decision in the suit and therefore it was a necessary party and in any event a proper party6. The said application was resisted by the first respondent inter alia on the ground that the appellant did not have any interest in the suit property and therefore the appellant was neither a necessary party nor a proper party to the suit. It was also contended that AAI itself being a substantial shareholder, having 26% share in the appellant company, would protect the interest of the appellant by contesting the suit and therefore appellant was not a necessary party. AAI has also filed a response to appellants application for impleadment raising two contentions : (i) any impleadment at that stage of the suit would delay the recording of evidence and final hearing thereby seriously affecting the interests of AAI; and (ii) the suit plot measuring 31000 sq.m. was not leased to the appellant7. A learned Single Judge dismissed the appellants application by order dated 1.4.2008. The learned Single Judge was of the view that as the appellant was yet to acquire any interest in the suit land and as the pending suit by the first respondent was for specific performance of an agreement which was a distinct earlier transaction between the first respondent and AAI to which the appellant was not a party, and as the first respondent was not a party to the arrangement between AAI and the appellant, the court cannot permit impleadment of appellant with reference to some future right which may accrue in future, after the decision in the suit. The appeal filed by the appellant was also dismissed by a Division Bench by order dated 25.8.2008. The Division Bench held that the appellant did not make out that he was a necessary party and the application merely disclosed that he was only claiming to be a proper party; that the appellants claim was not based on a present demise but a future expectation based on spes successionis; and that therefore, the impleadment of appellant either as a necessary party or proper party or formal party was not warranted. The said order is challenged in this appeal by special leave.

Reasoning: 11. On a careful consideration, we find that there is no conflict between the two decisions. The two decisions were dealing with different situations requiring application of different facets of sub-rule (2) of Rule 10 of Order 1. This is made clear in Sumtibai itself. It was observed that every judgment must be governed and qualified by the particular facts of the case in which such expressions are to be found; that a little difference in facts or additional facts may make a lot of difference in the precedential value of a decision and that even a single significant detail may alter the entire aspect; that there is always peril in treating the words of a judgment as though they were words in a legislative enactment, and it is to be remembered that judicial utterances are made in the setting of the facts of a particular case. The decisions in Ramesh Hirachand Kundanmal v. Municipal Corporation of Greater Bombay [1992 (2) SCC 524 ] and Anil Kumar Singh v. Shivnath Mishra [1995 (3) SCC 147 ] also explain in what circumstances persons may be added as parties13. If the principles relating to impleadment, are kept in view, then the purported divergence in the two decisions will be found to be non-existent. The observations in Kasturi and Sumtibai are with reference to the facts and circumstances of the respective case. In Kasturi, this Court held that in suits for specific performance, only the parties to the contract or any legal representative of a party to the contract, or a transferee from a party to the contract are necessary parties. In Sumtibai, this Court held that a person having semblance of a title can be considered as a proper party. Sumtibai did not lay down any proposition that anyone claiming to have any semblance of title is a necessary party. Nor did Kasturi lay down that no one, other than the parties to the contract and their legal representatives/transferees, can be impleaded even as a proper party14. On a careful examination of the facts of this case, we find that the appellant is neither a necessary party nor a proper party. As noticed above, the appellant is neither a purchaser nor the lessee of the suit property and has no right, title or interest therein. First respondent -plaintiff in the suit has not sought any relief against the appellant. The presence of the appellant is not necessary for passing an effective decree in the suit for specific performance. Nor is its presence necessary for complete and effective adjudication of the matters in issue in the suit for specific performance filed by the first respondent-plaintiff against AAI. A person who expects to get a lease from the defendant in a suit for specific performance in the event of the suit being dismissed, cannot be said to be a person having some semblance of title, in the property in disputeThis contention has no merit. The appellant as lessee may certainly have the powers of AAI necessary for performance of the functions that have been assigned to them. What has been assigned is the function of operation, management and development agreement with reference to the area that been demised. Obviously the appellant as lessee of the Airport cannot step into the shoes of AAI for performance of any functions with reference to an area which has not been demised or leased to itThis does not in any way help the appellant to claim a right to be impleaded. If the interim order in the suit filed by the first respondent came in the way of granting the lease of the suit land, it is clear that the suit land was not leased to appellant. The fact that if AAI succeeded in the suit, the suit land may also be leased to the appellant is not sufficient to hold that the appellant has any right, interest or a semblance of right or interest in the suit property. When appellant is neither claiming any right or remedy against the first respondent and when first respondent is not claiming any right or remedy against the appellant, in a suit for specific performance by the first respondent against AAI, the appellant cannot be a party. The allegation that the land is crucial for a premier airport or in public interest, are not relevant to the issue.