Delhi Develpment Authority vs Nalwa Sons Investment Ltd

3. Briefly stated, in an auction conducted by the appellant, respondent No.1 (former name Jindal Strips Limited) was allotted a commercial plot in Bhikaji Cama Place, New Delhi, on 23rd March, 1993. Possession of the plot was handed over to respondent No.1 on 6th September, 1993 and a Perpetual Lease Deed dated 28th September, 1993, was executed by the appellant in favour of respondent No.1. It is apposite to reproduce stipulation 6(a) of the said Lease Deed, which reads thus:

4. Respondent No.1 and respondent No.2 entered into an arrangement and invited an order of demerger from the Company Judge of the High Court of Punjab and Haryana at Chandigarh. On 30th May, 2003, the High Court of Punjab and Haryana passed the order of demerger of the companies. It would be apposite to reproduce paragraphs (2) and (3) of the said demerger order, which read thus:

13. In the first place, it is not open to the respondents to contend that the arrangement and demerger scheme does not result in transfer of the subject plot from the original lessee 21 (respondent No.1) to respondent No.2. Inasmuch as, clause (2) of the order passed by the Company Judge approving the scheme of demerger, as reproduced above, makes it amply clear that all property, assets, rights and powers in respect of the specified properties, including the subject plot, shall stand transferred to and vest in respondent No.2. Once it is a case of transfer, it must abide by the stipulation in clause 6(a) of the Lease Deed of taking previous consent in writing of the lessor (appellant) and to fulfill such terms and conditions as may be imposed, including to pay any unearned increase amount. We find force in the argument of the appellant that the fact situation of the present case would, in fact, be governed by clause 2(d) of the instructions which reads thus:

15. The fact that it was a case of transfer is reinforced from the order of demerger passed by the Company Judge and once it is a case of transfer, coupled with the fact that the 23 respondents are not covered within the categories specified in clauses 1(a) to 1(d) of the policy of the appellant, reproduced in paragraph 5 above, they would be liable to pay unearned increase (UEI) in the manner specified in clause 6(a) of the Lease Deed. The obligation to pay UEI does not flow only from the instructions issued by the competent authority of the appellant but primarily from the stipulation in the Perpetual Lease Deed in the form of clause 6(a). Viewed thus, the Division Bench of the High Court committed a manifest error in allowing the appeal and setting aside the judgment of the learned Single Judge, who had rightly dismissed the writ petition and upheld the demand notice and the show cause notice calling upon the respondents to pay the unearned increase amount in terms of clause 6(a) of the Perpetual Lease Deed. That demand was final and binding on the respondents, so long as the stipulation in the form of clause 6(a) of the Perpetual Lease was in force.

18. Accordingly, this appeal succeeds. The impugned judgment and order passed by the Division Bench of the High Court is set aside and instead, the judgment and order passed by the leaned Single Judge dated 16 th August, 2012, dismissing W.P.(C) No.1885 of 2011, is restored. There shall be no order as to costs.

All applications are also disposed of.

April 24, 2019.