Delhi High Court
M/S Exclusive Motors Pvt.Ltd vs Itdc & Others on 1 July, 2009
Author: G.S. Sistani
Bench: G.S.Sistani
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ WP(C)No.3682/2008
Date of Pronouncement: July 01, 2009
# M/S.EXCLUSIVE MOTORS PVT. LTD .... Petitioner
Through : Mr.Ravi Gupta and Mr. Ankit
Jain, Advocates
Versus
ITDC & ORS. .... Respondent
Through : Mr. Shanti Bhushan, Sr. Adv.
with Mr.Sushant Kumar, Adv.
CORAM:
HON'BLE MR. JUSTICE G.S.SISTANI
1. Whether reporters of local papers may be allowed to see
the judgment? YES
2. To be referred to the Reporter or not? YES
3. Whether the judgment should be reported in the Digest? YES
G.S. SISTANI, J:
1. Brief facts which have given rise to filing of the present petition
are that respondent owns and runs a hotel under the name and
style of Ashok. In the year 2003 petitioner was in need of a
premises, for carrying on its business for retailing of luxury Cars
and other related goods. Pursuant to negotiations between the
parties, petitioner accepted the offer of the respondents vide
letter dated 27.1.2004. Peaceful possession of an area
measuring 3013.49 sq. ft. located adjacent to out gate, forming
part of Ashok Hotel, was handed over to the petitioner for
running the office/show-room on 8.4.2003.
2. A licence deed was executed between the parties on 8.4.2003
initially for a period of three years commencing from 8.4.2003
WP(C)NO.3682/2008 Page 1 of 37
and expiring on 7.4.2006. The document provided that the
licence was renewable with the enhanced licence fee @11% of
the last paid fee. It is the case of the petitioner that although
the documents were styled as licence deed, however, the
nature of transaction entered into between the parties was in
fact a lease created by the respondent in favour of the
petitioner. The petitioner was in independent occupation of the
premises and also had free and uninterrupted use. It is stated
that the premises are not in the shopping arcade of the hotel,
but an independent show-room near the parking at the
convention hall entrance of the hotel and only a bare structure
without any paint or fixtures were handed over to the
petitioner, who carried out substantial renovations, including
flooring, false ceiling, air conditioning, erection of walls,
development, greening and landscaping of the common area,
erection of toilet and a pantry etc. The petitioner is stated to be
running his show-room since the year 2003 onwards.
3. It is contended that in order to make the premises usable and
more presentable the petitioner had incurred expenses of
several lacks on taking over the possession. As the licence of
the premises was to expire in April 2006, the petitioner had
written a letter on 5.12.2005 to respondent inter alia requesting
them to renew the licence for a further period of three years
ending on 7.4.2009. Petitioner also sent letters dated 7.1.2006,
15.2.2006 and 31.3.2006 to respondent as reminders to
consider the request of the petitioner for fresh execution of the
licence deed for the renewed period. In response to the letter
WP(C)NO.3682/2008 Page 2 of 37
of request, a meeting was attended by the petitioner with the
licensing committee on 29.3.2006 and the licence was
extended for a further period of two years w.e.f. 8.4.2006 to
7.4.2008. Vide letter dated 31.3.2006 two sets of licence deeds
were also delivered and the petitioner was requested to sign
the same and return it for necessary action. Petitioner is stated
to have signed the licence deed dated 1.4.2006 and thereafter
sent it back to the respondents. The licence was for a period of
two years commencing from 8.4.2006 and expiring on 7.4.2008.
This licence deed also contained a renewal clause on the
enhanced licence fee @ 11% over and above the existing
licence fee. Petitioner also considered it necessary to carry out
some additions and alterations. A request was made on
7.3.2006 which is stated to have been considered by
respondents and petitioner was permitted by a letter dated
17.5.2006 to carry out the same. Petitioner is stated to have
incurred an expenditure of 20-22 lacs on the renovation.
4. Petitioner was thereafter served with a letter dated 14.9.2006.
Vide this letter respondents not only proposed to terminate the
licence agreement executed by them in favour of the petitioner
in regard to the premises in question, but also required the
petitioner to hand over peaceful and vacant possession of the
same to respondents. It is submitted that the action on the part
of the respondent was absolutely arbitrary, mala fide, illegal
and highhanded. It is contended that there was no occasion for
the respondent to issue the letter after having entered into an
agreement with the petitioner for a period of two years starting
WP(C)NO.3682/2008 Page 3 of 37
w.e.f. 8.4.2006 ending on 7.4.2008. The respondents could not
have cancelled the licence deed after giving three months
notice, as the clause of three months notice could not have
been exercised unreasonably and without any cause. It is
contended that the licence was for a fixed period of two years
and could not have been terminated before the stipulated time
besides the petitioner was permitted to carry out additions and
alterations in the premises in the month of May, 2006 which
renovation could only be completed by the month of August,
2006 and the petitioner spent a huge amount on renovation
besides paying licence fee. Thus the action of the respondent
of issuing the letter was mala fide. It is also stated that the
respondents being a State owned agency was required to act
reasonably while dealing with the public at large. It is
submitted that once after having taken a considered decision to
renew the licence in its meeting held on 29.3.2006, there was
no reason to terminate the said licence in the month of
September, 2006 as there was no change in the circumstances
neither there was any breach of any terms of the agreement.
Counsel further submits that the intention of the respondent
was to increase the licence fee and black-mail and pressurize
the petitioner to agree to their illegal demands. Such notices
were issued to other shop keepers and business being run in
the premises of the same hotel. Reply to the letter was sent on
6.11.2006 stating that the impugned action of termination of
licence on the part of the respondent was totally unjustified,
unfair and illegal. It was also brought to the notice of the
WP(C)NO.3682/2008 Page 4 of 37
respondent that there was no violation of any of the terms of
the agreement and thus the respondent should withdraw the
impugned termination. In order to protect the possession, the
petitioner was constrained to challenge the letter and
communication dated 14.9.2006 by filing a civil suit being
CS(OS)No.2308/2006 titled M/s. Exclusive Motors Pvt. Ltd.
Vs. ITDC and Anr.. The matter came up for hearing before
the High Court on 14.12.2006. While issuing summons, this
Court had directed that till the next date of hearing, letter dated
14.9.2006 issued by defendant be not given effect. The
petitioner thereafter withdrew the aforesaid suit on 7.4.2008.
Relevant portion of the order reads as under:
"Counsel for the defendant states that in view of
the fact that the agreement itself has run out its
course during the pendency of the present
proceedings and stands exhausted by efflux of
time, the defendant does not rely on the letter
dated 14.9.2006 issued to the plaintiff and it does
not wish to act on the same. He further submits
that the suit is rendered infructuous.
In view of the aforesaid submission made by the
counsel for the defendant, counsel for the plaintiff
seeks permission to withdraw the present suit while
reserving its rights to seek its remedies against the
defendant as may be available to it in law, in terms
of the Agreement dated 1.4.2006.
The suit and the pending application are disposed
of.
The interim order stands vacated.
The date of 28.7.2008 is cancelled."
5. On 7.4.2008 learned counsel for the respondent had made a
statement to the effect that during the pendency of the suit
even the subsequent agreement dated 1.4.2006 had exhausted
WP(C)NO.3682/2008 Page 5 of 37
as the same was effective from 8.4.2006 to 7.4.2008 which
time has also run out, therefore, the defendant did not wish to
rely upon letter of 14.9.2006 and the suit thus became
infructuous. Based on the statement of counsel for the
defendant, learned counsel for the plaintiff sought permission to
withdraw the suit while reserving its rights to seek its remedies
against the defendant as may be available to it in law in terms
of the agreement dated 1.4.2006.
6. It is submitted by counsel for the petitioner that suddenly on
10.5.2008 Mr.A.K.Nigam, Mr.Rajindra Nigam, Mr.Chopra,
Mr.Singh, Mr.Pankaj Mittal, Mr.Vats, Mr.Kishore and their
associates at about 4:00 p.m. barged into the show room
premises of the petitioner. They trespassed into the premises
with 2-3 trolleys and took forcible entry in the premises. The
goods of the petitioner were sought to be shifted, the director of
the company was manhandled and signboard was damaged.
The entry to the showroom was blocked and they interrupted
the ingress and egress to the showroom. Local police was
called, who did not render any help to the petitioner. Many
people gathered outside the showroom premises, however,
belongings like furniture, fixtures, cars are still lying in the
premises while various goods have been taken away by the
officers of the respondents. Two cars Bentley (blue colour) and
another Lamboghini (blue colour) were still lying stationed /
parked in the showroom at the time of filing of the present
petition which have since been removed by the petitioner in
terms of order dated 30.5.2008. The normal working of the
WP(C)NO.3682/2008 Page 6 of 37
petitioner from the premises has been disturbed. It has also
been urged before this court that the licence executed in favour
of the petitioner is irrevocable in nature as the petitioner has
been permitted to carry out structural changes in the premises
and permission on the part of the respondent for carrying out
such changes by the petitioner makes the licence in question,
irrevocable. It is contended that petitioner had executed the
work of permanent nature and had incurred huge expenses in
execution thereof. The aforesaid works have been carried out
with the consent/approval and permission of respondents.
7. It is contended that the impugned action of respondent -
Corporation and its officers is wholly unauthorized and illegal.
They acted like local goondas and hooligans and took law in
their own hands. It is submitted that the action of the
respondent is mala fide, arbitrary, dishonest and the petitioner
cannot be forceably dispossessed without due process of law.
As per the petitioner the respondents were obliged to take
action for eviction of the petitioner under the provisions of
Public Premises (Eviction of Unauthorized Occupants) Act and
not in an illegal manner. In the above circumstances, the
petitioner seeks the following prayers:
"Issue a writ of mandamus, directing the
respondents to execute a license deed in favour of
the petitioner company by way of renewal of the
licence, concerning and in regard to the property
and premises admeasuring 3013.49 sq. ft. (located
adjacent to out gate of the perimeter wall of Annexe
and beneath the Samrat Parking lot at
Ashok/Samrat gate) forming part of Ashok Hotel
situated at 50-B, Chanakya Puri, New Delhi
WP(C)NO.3682/2008 Page 7 of 37
FURTHER FOR A WRIT, ORDER AND /OR DIRECTION
IN THE NATURE OF:
Mandamus, directing the respondents to remove
their goods which have illegally and unauthorisedly
being stuffed by the respondents in their suit
premises on 10.5.2008 after 7:00 p.m. in the
evening and also to restore back the goods and
belongings of the petitioner, which have illegally
been taken away by the offices of the respondent
corporation without any rights in the suit premises.
AND FURTHER FOR A WRIT, ORDER AND /OR
DIRECTION IN THE NATURE OF:
PROHIBITION interalia directing and restraining the
respondents, their officers, employees, servants,
agents, contractors etc. etc. from causing any
interference in the peaceful use and enjoyment of
the petitioner and running of its business of world
class luxury premier cars from the suit premises
admeasuring 3013.48 sq. ft. (located adjacent to
out gate of the perimeter wall of Annexe and
beneath the Samrat Parking lot at Ashok/Samrat
gate) forming part of Ashok Hotel situated at 50-B,
Chanakya Puri, New Delhi."
8. To buttress his argument that even a trespasser can only be
removed by due process of law, learned counsel for the
petitioner has relied upon Bishan Das Vs. State of Punjab,
AIR 1961 SC 570. In the case of Bishan Das (Supra) the
petitioners had approached the Supreme Court under Article 34,
14, 19 and 31 of the Constitution of India on the ground that
interference with their fundamental rights to property by the
executive action without any authority or specific rule of law, is
illegal. The petitioners were occupying the dharamsala in an
adjoining temple and some appurtenant shops standing on a
piece of land near the railway station at Barnala, distict
Sangrur, State of Punjab. The officials and the Municipal
Committee Basnara by force and without any authority of law
WP(C)NO.3682/2008 Page 8 of 37
had dispossessed them from the Dharamsala. The respondents
were restrained from interfering with the possession of the
petitioners by the Court.
9. Petitioner has also relied upon Ram Rattan Vs. State of U.P.
1977 SC 619 and more particularly para 4, which reads as
under:
"it is well settled that a true owner has every right
to dispossess or throw out a trespasser, while the
trespasser is in the act or process of trespassing,
and has not accomplished his possession, but this
right is not available to the true owner if the
trespasser has been successful in accomplishing his
possession to the knowledge of the true owner. In
such circumstances the law requires that the true
owner should dispossess the trespasser by taking
recourse to the remedies available under the law."
10. Reliance has also been placed upon Krishna Ram Vs. Mrs.
Shobha Venkat JT 1989 (3) SC 489, State of U.P. Vs.
Maharaja Dharmander 1989 (2) SCC 505, wherein it has been
held that a lessor, with the best of title, has no right to resume
possession extra-judicially by use of force, from a lessee, even
after the expiry or earlier termination of the lease by forfeiture
or otherwise. The use of the expression „re-entry‟ in the lease
deed pertains to a lease does not authorize extra judicial
methods to resume possession. Under law the possession of a
lessee, even after the expiry of its earlier termination is in
juridical possession and forcible dispossession is prohibited; a
lessee cannot be dispossessed otherwise than in due course of
law. It has also been held that the "Government authorities
should have a „legal pedigree‟ and do not have an extra judicial
WP(C)NO.3682/2008 Page 9 of 37
right of re-entry. The possession can be resumed by
Government only in a manner known to or recognized by law.
11. Counsel for the petitioner has also placed reliance on
R.C.Patuck Vs. Fatima A. Kindasa 1997 5 SCC 334 and more
particularly paragraphs 7 and 12.
"7. The learned Senior Counsel for the petitioner,
Mr Soli J. Sorabjee, contended that the orders
passed by the Chief Metropolitan Magistrate dated
26-4-1996 and the further orders passed by the
High Court on 9-7-1996 were liable to be set aside
as the possession of the respondents was a
continuing wrong. He also contended that this was a
hard case in which an old lady aged about 75 years
was being victimised by the respondents who were
in the habit of illegally occupying various premises
in Bombay and that in exercise of the powers of this
Court under Article 142 of the Constitution of India,
this Court could grant relief in spite of the fact that
the dispossession was more than 2 months next
before the preliminary order under Section 145(1).
12. Relying upon the aforesaid passage, learned
Senior Counsel contended that the limitation of two
months in the proviso to sub-clause (4) of Section
145 would not come in the way of this Court while
exercising powers under Article 142 for granting
possession to the petitioner even though the
dispossession of the petitioner was for a period in
excess of two months next before the date of the
preliminary order passed under Section 145(1). It
will be seen that even according to the petitioner,
she permitted the first respondent in November
1991 to temporarily occupy 2500 sq. ft. on the
ground floor of the premises. Subsequently the first
respondent did not vacate and on the other hand,
the first respondent allowed the second respondent
to occupy the property claiming that he was her
husband and thereafter they constructed a wall
dividing the said portion from the other portion
occupied by the petitioner. On these facts we do not
find any special circumstances which are different
from ordinary cases where a person permits a
licensee or a tenant to occupy the premises and
upon termination of the licence or the lease, the
licensee or the tenant, as the case may be, does not
vacate the premises or makes some construction on
the property. No doubt the petitioner is an old lady
of 75 years and there is some material to show that
Respondents 1 and 2 have been indulging in similar
WP(C)NO.3682/2008 Page 10 of 37
litigations in Bombay. But that in our opinion is not
sufficient to persuade us to exercise powers under
Article 142 of the Constitution of India. The
petitioner has adequate remedies under the law for
recovery of possession. For the aforesaid reasons
this special leave petition is dismissed."
12. Reliance has also been placed on State of Haryana Vs.
Mohinder Pal AIR 2000 SC 3580, wherein the Apex Court has
held that government cannot take law on its own hand while
dispossessing the petitioner but should have followed the due
process of law. Learned counsel has also relied upon State of
West Bengal Vs. Vishnunarayan and Associates (P) LTd &
Anr. AIR 2002 SC 1493 wherein the Apex Court has held that
State Government could not have taken steps for securing
possession by use of force. Learned counsel has also relied
upon Jafar Saddiqui & Ors. Vs. DDA 2003 V AD Delhi 149, a
decision of Single Judge of this Court wherein it has been held
that if a person is a tenant, licencee or occupier of a property in
any legal capacity and if rights are terminated, proceedings
must be taken in accordance with law and it is not open to the
parties to forcibly dispossess such a person. In the same vein,
learned counsel has relied upon Krishna Ram Mahale Vs.
Mrs.Shobha Venkat Rao JT 1989(3) SC 489, wherein it has
been held that where a person is in settled possession of
property, even on the assumption that he has no right to
remain on the property, he cannot be dispossessed by the
owner except by recourse to law. Learned counsel has also
relied upon Chandu Lal Vs. MCD AIR 1978 Delhi 174 and East
India Hotels Vs. Syndicate Bank 1(1992) BC 1 (SC) as well
WP(C)NO.3682/2008 Page 11 of 37
as on R.V. Bhupal PD. Vs. State of A.P. (1995) 5 SCC 698
and Rattan Lal Vs. MCD, 100 (2002) DLT 213 a decision of
Single Judge decision of this court.
13. Per contra, learned senior counsel for the respondent submits
that a person who invokes the extra ordinary jurisdiction of this
Court under Article 226 of the Constitution of India, has to
approach this court with clean hands and in case the person
approaches the Court with unclean hands, he is not entitled to
any relief whatsoever. It is submitted that the petitioner is an
illegal occupant of the licensed premises, as the licence has
already come to an end on 7.4.2008 by efflux of time and as
such has no right to continue with the possession over the
licensed premises beyond the period. It is next contended that
the petitioner cannot be allowed to perpetuate its illegality and
in order to continue its illegal possession over the licence
premises. It is also contended that the court should not
interfere in the contractual relations entered into between the
parties and no arbitrary action or discriminatory practice has
been followed by the respondent.
14. It is strongly argued before this Court that the respondents
have entered into a contractual relationship with the petitioner
by means of a licence deed dated 7.4.2003, which was further
renewed on 1.4.2006. The relationship between the parties is
purely governed by law of contract and therefore, the
appropriate remedy available to the petitioner would be to
claim damages against eviction. It has also been contended
that invoking jurisdiction of this Court under Article 226 is not
WP(C)NO.3682/2008 Page 12 of 37
an appropriate remedy. It is also submitted that even assuming
that the respondent had failed to follow the due process of law,
still the respondents have taken possession on 10.5.2008 and
after taking possession they have started using the same as
F&B function area/Salad Bar from 10.5.2008, photographs in
support of this plea have been placed on record. It has also
been contended that no force was used to dispossess the
petitioner and the goods inventory lying within the licensed
premises have been removed within the parameters of law and
with the active support of cooperation of the employees agents
of the petitioner.
15. Learned counsel for the respondent submits that admittedly,
the licence of the petitioner has expired, thus the Court cannot
be asked to interfere in such circumstances. Learned counsel
for the respondent has relied upon various clauses of the
licence deed to show that initially the licence deed was signed
between the parties on 8.4.2003 for a period of three years,
which was subsequently renewed for a period of two years
which period has since come to an end. The licence was to be
renewed at the option of the licensor on the expiry of the
stipulated period under clause 3, and on such terms and
conditions as the licensor may impose in its own discretion. It
would be necessary and useful to reproduce the relevant terms
of this licence deed.
"3. This licence is granted for a period of 3 years
commencing from 8th April, 2003 and shall expire on
7th Apri, 2006 subject to the provisions for earlier
termination hereinafter contained.
WP(C)NO.3682/2008 Page 13 of 37
4. The licence may be renewable at the option of
the Licensor on the expiry of the period stipulated
under clause 3, and on such terms and conditions
as the Licensor may impose in his own discretion.
The duration of the extended period shall be
determined by the Licensor but will not be for more
than 3 years for each such extension. At the time
of each such renewal or extension, the parties,
hereto, shall execute a fresh Licence Deed in
respect of the premises given on license on the
same terms and conditions with an enhancd Licence
Fee @ 11% of the Licence Fee as mentioned in
Clause 39 of this Deed. The Licensee will apply for
the renewal of his licence 3 (three) calendar months
before expiry of the licence and on failure to do so,
the Licensor will be free to negotiate with any other
party to allot the space. It is also clearly
understood by and between the parties that the
licensor will exercise the sole discretion with regard
to the renewal of the licence and also the terms and
conditions of the renewed licence and the Licensor‟s
decision in this regard shall be final and binding on
the licensee.
6. The right conferred upon these presents is
only that of a Licensee. It is expressly stated that
the possession of the premises lies with the
Licensor, and, the licensee can have only a right to
use and occupation of the portion hereby licensed
and not other right whatsoever. This not a lease
and the relationship is only that of a Licensor &
Licensee and not that of Landlord & Tenant OR
Lessee.
9. It is agreed that the licensee will not be
permitted the use of licensed premises, in any form,
for any other purpose other than what has been
agreed under this licence or sublet to any
individual/ party/ company/ organization. The
licensee alone and no other party or person will be
permitted to carry on business in the said licensed
premises nor will the benefits under the licence or
any of them be assigned, transferred, shall or
otherwise parted with, in whole or part by the
licensee. Any such act by the licensee shall be
considered violation of licence deed and the
licensor shall have the right to terminate the
licence. In such circumstances, the licensee will
have to settle all the outstanding dues and hand
over vacant possession of the licensed premises
within 15 days on receipt of such communication
from the licensor.
WP(C)NO.3682/2008 Page 14 of 37
12. The licensee shall get the licensed space
organized and carry out the interior decoration of
the premises at its own cost after getting the plans
and overall design of the furnishing approved by the
General Manager, Ashok Hotel. The licensee shall
be further required to make such additions and
alterations or changes in the furniture, carpets etc.
as and when felt necessary by the General Manager
of the Hotel to keep the décor of the licensed space
to meet the standard of the Hotel. Failure to carry
out such modifications within the period as
prescribed by the General Manager of the Hotel,
shall entitle the licensor to disallow the licensee
from opening the licensed premises to customers
till such time the required modifications and
refurnishing as asked for is carried out by the
licensee.
14. The licensee shall keep the premises clean,
orderly condition and for the purpose the licensee
shall do at their own cost whatever is required and
desired by the Licensor. Since the licensor is in
possession of the property and the licensee is
permitted only use and occupation of the premises,
the licensee shall not do any act by which such
peaceful possession and enjoyment of thelicensor is
endangered in any way.
48. It is agreed that the licensee can terminate
the licence agreement after giving three months
notice in writing from either side. However, in case
the licensee terminates or abandons the licencee
prior to the above said period of notice, the licensee
shall be liable to pay the liquidated damages
equivalent to the licence fee payable to the Licensor
for the unexpired notice period.
49. On termination of the licence, the licensee
shall have no right under the licence and shall
further have no right to enter the premises of the
Hotel as a licensee. The licensee shall remove his
articles goods from the licensed premises within
such periods as may be informed by the licensor
and in case the licensee does not remove his
articles and goods, the same shall be removed by
the licensor at the risk and cost of the licensee and
the licensee shall have no claim whatsoever on this
account against the licensor. The licensor shall,
however, have lien over the goods and the articles
and the licensee shall not be allowed to remove the
same unless all the dues of the licensor have been
paid by the licensee. The licensor also reserves the
right to auction the materials & goods of
thelicensee if the licensee does not remove the
WP(C)NO.3682/2008 Page 15 of 37
goods and articles within a reasonable time after
clearing all outstanding dues. In such an event, the
licensor shall adjust the auction proceeds with the
amount due and return the balance to the licensee.
56. Notwithstanding anything contained herein, it
is agreed that the said licensed premises shall at all
times be under the control and supervision of the
licensor and the licensor shall retain domain and
possession of the said licensed premises and shall
have the right to direct the mode and manner of the
said use of the said licensed premises so as to more
effectively provide for facilities and amenities to
customers and visitors of the Hotel.
60. In respect where provision of Public Premises
(Eviction of Unauthorized Occupants) Act, 1971 can
be invoked by the licensor in respect of the licensed
premises the provisions of the said Act shall apply.
In respect of any other dispute or difference relating
to the terms of his licence deed, the matter shall be
referred to the sole arbitration of the Vice President
(Hotels) or any other person appointed by him on
his behalf. The award given by the arbitrator shall
be binding upon the parties. It is specifically agreed
by the licensees that it will have no objection to any
such appointment that the arbitrator so appointed is
an employee of the licensor or he has already
expressed view on, for or any of the matters in
dispute or difference. The arbitrator so appointed
shall have power to extend the time for making an
award. Save as above, the said Arbitrator shall act
under provisions of the Arbitration and Conciliation
Act, 1996. Subject to above, only Delhi Courts will
have jurisdiction."
16. Leaned counsel for the petitioner submits that in terms of
clauses 3 and 4 of the licence deed, any renewal was at the
sole option of the licensor, thus the submission of counsel for
petitioner that merely because the petitioner was allowed to
carry out certain renovations, would not lead to the conclusion
that the licence is for an indefinite period.
17. Learned counsel for respondent submits that the argument of
learned counsel for the petitioner that although the agreement
was signed as the licence deed, but in fact it was a lease deed,
WP(C)NO.3682/2008 Page 16 of 37
is unfounded and baseless. The counsel has relied upon clause
6 of the licence deed wherein it has been categorically agreed
that the arrangement is only that of a licencee and the
possession of the premises lies with the licensor and the
licencee can only have a right of use and occupation of the
portion and further the agreement is not a lease and the
relationship is only that of a licensor and licencee and not that
of landlord or tenant or lessee. Counsel while relying upon
clause 12 of the licence deed submits that any interior
decoration carried out by the petitioner was part of the terms of
the licence agreement. Learned counsel submits that
possession of the premises has all along been with the
respondents. Learned counsel has also drawn the attention of
the court to clauses 49, 50, 56 of the licence agreement.
"49. On termination of the licence, the licensee
shall have no right under the licence and shall
further have no right to enter the premises of the
Hotel as a licensee. The licensee shall remove his
articles goods from the licensed premises within
such periods as may be informed by the licensor
and in case the licensee does not remove his
articles and goods, the same shall be removed by
the licensor at the risk and cost of the licensee and
the licensee shall have no claim whatsoever on this
account against the licensor. The licensor shall,
however, have lien over the goods and the articles
and the licensee shall not be allowed to remove the
same unless all the dues of the licensor have been
paid by the licensee. The licensor also reserves the
right to auction the materials & goods of
thelicensee if the licensee does not remove the
goods and articles within a reasonable time after
clearing all outstanding dues. In such an event, the
licensor shall adjust the auction proceeds with the
amount due and return the balance to the licensee.
50. Upon the expiry of the period of this licence or
earlier termination of the licence for any cause
whatsoever, the licensee shall have no right to carry
on business at the said licensed premises. The
WP(C)NO.3682/2008 Page 17 of 37
licensor shall have undisputed right to make use of
the said licensed premises at his discretion
thereafter. It will be lawful for the licensor without
notice to enter upon thelicensed premises after the
termination/ expiry of the license.
56. Notwithstanding anything contained herein, it
is agreed that the said licensed premises shall at all
times be under the control and supervision of the
licensor and the licensor shall retain domain and
possession of the said licensed premises and shall
have the right to direct the mode and manner of the
said use of the said licensed premises so as to more
effectively provide for facilities and amenities to
customers and visitors of the Hotel."
18. It is also contended by counsel for the respondent that the
rights and liabilities of the parties are clear, unambiguous and
reduced into writing in the form of a licence deed which is an
admitted document. Petitioner has committed an illegality and
he cannot be permitted to approach this court once having
committed the illegality. Counsel has vehemently submitted
that admittedly the licence has come to an end and the original
owner, the respondent herein is in possession and thus the
owner is defending his possession and, therefore, it is really the
petitioner, who seeks to take illegal possession which is being
resisted by the actual owner. In support of this proposition
learned counsel has relied upon a full bench decision of this
court in the case of Chandu Lal Vs. MCD (Supra) and more
particularly paragraphs 24, 26, 27, 34, 36, 37 and 38, which
read as under:
"24.The petitioners in the instant petitions were given the
liberty to occupy the Kiosk for 11 months "for purposes of
trade." They were forbidden from parting with possession
of the Kiosk or allow any other person to occupy the same
or to use any part thereof or to enter into partnership with
any other person without the written permission of the
Commissioner of the Corporation The liberty to occupy
the Kiosk was personal to the petitioners alone. Besides,
WP(C)NO.3682/2008 Page 18 of 37
the petitioners were required "faithfully and diligently" to
"comply with all the directions, general or special" that
may be given by the Commissioner of the Corporation
from time to time. The infringement of any of the terms
and conditions of the license was to result in the
cancellation of the license. the petitioners having, no
claim whatsoever on that account. Further, the license
was liable to be cancelled at any time by the
Commissioner of the Corporation or other authorised
officer without assigning any reason. All these conditions
militate against "lease", no interest in the premises
passed to the petitioners. The Corporation in the
circumstances in enforcing its right of re-entry by self
help cannot be said to have taken the law into its own
hands or that it was in any manner acting without
recourse to law in resuming the possession. The
underlying assumption in the case of a license is that the
owner continues to be in possession and control of the
property. In such circumstances the Court cannot throw
its protection round the trespasser having no vestige of
any right what so ever, and his unlawful act of continuing
to occupy the premises, by the issue of a prohibitory
order against the lawful owner.
26. There is a catene, of authorities in support of the
proposition that in the case of a license there is
something less than a right to enjoy the property in the
licensee; it cannot be exercised by servants and agents
and is terminable while on the other hand, in the case of a
lease, there is a transfer to a right to enjoy the property
or in other words the lessee is entitled to enjoy the
property. A bare licensee having no interest in the
property cannot maintain an action for its possession. A
mere licensee has only a right to use the property. Such a
right does not amount to an easement or an Interest in
the property but is only a personal privilege to the
licensee. After the termination of the license, the licensor
is entitled to deal with the property as he likes. This right
he gets as an owner in possession of his property. He
need not secure a decree of the Court to obtain this right.
He is entitled to resist in defense of his property the
attempts of a trespasser to come upon his property by
exerting the necessary and reasonable force to expel a
trespasser. If, however, the licensor uses excessive force,
he may make himself liable to be punished under a
prosecution, but he will Infringe no right of the licensee,
No doubt a person in exclusive possession of the property
is prima facie to be considered to be a tenant,
nevertheless he would not be held to be so if the
circumstances negative any intention to create a tenancy.
27. In the instant cases the petitioners' possession of the
premises (Kiosk) on the facts and circumstances of the
case, cannot be held to be conclusive evidence of their
WP(C)NO.3682/2008 Page 19 of 37
being a lessee as the grant was not coupled with an
interest in the property. The principle once a licensee
always a licensee apples proprio vigore in these cases.
The petitioners are not entitled to retain possession
against the Corporation, which can take possession of the
Kiosk and would not be driven to a Court of law as the
mere physical possession of the petitioners confers no
right on them. The petitioners, therefore, in law are not
entitled to retain possession against the Corporation,
having only the personal privilege to carry on their
business which otherwise without the permission granted
by the Corporation would be an unlawful act. These well-
settled principles - find support from Satwant Singh v.
Assistant Passport Officer, New Delhi AIR 1967 SC 1836;
Associated Hotel's case (AIR 1959 SC 1262) (SUPRA); B.
M. Lall v. M/s. Dunlop Rubber Co. (India) Ltd., Air 1%8 Sc
175; Miss Aninha D'Costa v. Mrs. Parvatibai M. Thakur,
AIR1966 bOM 113; Beant Singh v. Cantonment Executive
Officer, Jammu Air 1960 J and K 83, Chinna Pillai v. N.
Govindaswami Naidu, AIR 1969 Mad 191; Milka Singh v.
Diane Air 1964 J and K 99 and Raj Singh v. Union of India
1972 Ren CR 718; (AIR 1973 Delhi 169) (A Bench decision
of this Court).
34. Shri Saigal. then submitted that the petitioners were
in possession of- the Kiosk since Jan- 1974 and being in
settled possession, the petitioners were not liable to be
evicted except in due course of law and that they were
further entitled to defend their possession even against
the rightful owner who may try to dispossess them. This
submission was sought to be reinforced on the basis of
case in Puran Singh v. State of Punjab AIR 1975 SC 1674.
Reliance then was placed on a Branch decision of East
Punjah High Court in State of Patiala and E P. States Union
v. Mohinder Singh, AIR 1958 Punj 325 and Vasudeva
Kurup v, Ammini Amma, 1964 Ker Lt 468 wherein it was
observed that a person in possession albeit without title,
was entitled to remain in possession, even against the
lawful owner until evicted in due course of law and that a
right course of action in such a case was to bring an
appropriate action against the person in possession and
secure his eviction in accordance with the provisions of
law. It was accordingly contended that the Corporation
was not entitled to take the law into its hands and throw
out the petitioners. There is a fallacy in the submission.
The petitioners being licensees with liberty to occupy and
use the Kiosk for a period of 11 months in the first
instance could not be said to be in legal possession of the
premises, the legal possession all along remained with
the Corporation. On revocation of the license they ceased
to enjoy the liberty to continue to occupy the Kiosk so as
to drive the Corporation to evict them in due course of
law, nor can the petitioners' possession be said to be
"settled possession" as was sought to be made out.
WP(C)NO.3682/2008 Page 20 of 37
36. Reliance on Lallu Yeshwant Singh v. Rao Jagdish
Singh, Air 19-68 Sc 620 and Mohan Lal v. State of Punjab
1970 Ren C J 95 (SC) is wholly misplaced, the former case
dealt with tenancy rights while the latter case pertained
to lease rights. It was in that context that it wag observed
that even an un authorised occupant could be evicted
only in the manner authorised by law.
37. No assistance can be derived by the petitioners from
Delhi Simla Catholic Archdiocese v. State of U. P., AIR
1976 Delhi 251. In that case the right of the State as
landlord to seek forcible eviction of the petitioners by
exercising the right of re-entry was repelled as the
petitioners, on the facts of the case, were held to be
lessees.
38. Temporary injunction sought by the petitioners could
be granted, if their case was covered by the three well
established principles, namely, (1) on making out a prima
facie case, (2) on showing balance of convenience in their
favor, in that the refusal of the injunction would cause
greater inconvenience to them and (3) whether on refusal
of the injunction they would suffer irreparable loss.
Granting an injunction is a matter of discretion and in its
exercise the Court has to satisfy itself whether the
petitioners have a friable case. Before invoking the
jurisdiction of the Court to seek temporary injunction the
petitioners were bound to show that they have a legal
right and that there was an invasion of that right. They
have failed to show a legal right. Facts and
circumstances. on the contrary, prima facie show that the
petitioners on the revocation of the license are
trespassers, there exists no justification for allowing them
to continue perpetuating their unlawful act."
19. While learned counsel for the petitioner has also relied upon a
decision of a Single Judge of this Court in the case of Jafar
Saddique and Others, Vakil Ahamad and Liaqat Ali Vs.
Delhi Development Authority and Anr., reported at 2003 V
AD (Delhi) 149, in support of his submission that even a
trespasser is to be removed by a due process of law and it is
not open to a party to forcibly dispossess a person, since one
party cannot be permitted to decide the status of the occupant
and the occupant has a right to defend himself. Learned
counsel for the respondent submits that the aforesaid judgment
WP(C)NO.3682/2008 Page 21 of 37
does not support the argument of the petitioner.
20. In the case of Jafar Saddique and Others, Vakil Ahamad
and Liaqat Ali (supra), the petitioners were unauthorized
occupants and were even paying damages under the Public
Premises (Eviction of Unauthorised Occupants) Act 1971. The
case set up by the petitioners was that they could not be
dispossessed without due process of law. In the light of these
facts, while dismissing Jafar Saddique and Others, Vakil
Ahamad and Liaqat Ali (supra), Single Judge of this Court
directed the petitioners to remove themselves from the land, in
question within a period of fifteen days. It will be useful to
reproduce paras 15 to 18 of this judgment:-
"15. The payment of damages itself under the PP Act
cannot create a right in favour of the petitioner as it only
implies that the petitioner is in unauthorized occupation
of the land for which he is being charged. It has been
held so in the case of Aisha Jalal (supra).
16. The question is: whether the petitioners are entitled
to the protection of the PP Act and the proceedings? In
my considered view, the answer to this is in the nevative.
17. The menace of occupation of public land acquired
for planned development of Delhi by unauthorized
encroachers has assumed alarming proportions. Lands
are acquired for such development after following the due
procedure under the LA Act. Compensation is paid for
such land. Thereafter, these lands are occupied by
persons without any right, title or interest and then they
are sought to be evicted from the land. All kinds of
benefits and rights are claimed. Even then these lands
are occupied without there being any right in favour of
the occupants. The general principles of trespasser
cannot apply to such persons who occupy public land
which is duly acquired after meeting the provisions of the
LA Act and are unauthorized occupants. It is necessary to
take steps to clear the occupation by such persons.
Unfortunately, these steps get delayed for reasons best
known to the authorities and when these people continue
to occupy such land, pleas, as are sought to be raised in
the present petition, arise.
WP(C)NO.3682/2008 Page 22 of 37
18. I am of the considered view that the petitioners
having no right, title or interest in the land are not
entitled to any protection and are liable to be evicted
from the land in question. In fact, demolition action also
took place and the structures of most of the petitioners
were demolished. However, they were permitted to be
reconstructed in terms of the orders passed by this Court
subject to the petitioners removing the structures
themselves from the property in question in case it was
found that the demolition had taken place in accordance
with law. Since I find no case in favour of the petitioner
and in view of the directions passed on 16th October, 1996
permitting the petitioners to reconstruct, I consider it
appropriate to direct the petitioners to remove
themselves from the structure and the land in question
within a maximum period of 15 days from today."
21. While relying on the case of Jafar Saddique and Others, Vakil
Ahamad and Liaqat Ali (supra) counsel for the respondent submits
that the rights between the parties are governed by a licence deed,
which is an undisputed document. Facts being crystal clear the
illegality of the possession of the petitioner is writ large on the face of
the record and therefore it is a fit case where a writ should be issued
against the petitioner itself and the Court cannot grant any protection
to such a petitioner.
22. Learned counsel for the respondents has relied upon
D.T.T.D.C. Vs. D.R. Mehara & Sons, reported at AIR 1996
Delhi 351, wherein Division Bench of this Court has held that a
licensee, who continues to occupy the premises after the expiry
of the licence, would be deemed to be in unlawful and illegal
possession and such an agency would not be entitled to an
injunction against the owner. It will be useful to reproduce
paras 9, 13 and 16.
"9. The point that arises in this appeal is whether a
person who himself asks the owner to enter into a
„Licence‟ and enters into such an agreement can, after
„expirty thereof and express request of the owners to
WP(C)NO.3682/2008 Page 23 of 37
vacate, seek the helping hand of the Court for a
temporary injunction against the owner and whether the
appellant can contend that till he is dispossessed by due
process of law, he is entitled for an injunction?
13. We shall now refer to the other aspect of the
matter. Assuming a trespasser ousted can seek
restoration of possession under Section 6 of the Specific
Relief act, can the trespasser seek injunction against the
true owner? In our view this question does not entirely
depend upon Section 6 of the Specific Relief Act but
mainly depends upon certain general principles
appliclable to the law of injunctions and as to the scope of
the exercise of discretion while gratning injunctions?
Recently, the law in this behalf has been clarified by the
Supreme Court in clear terms in Mahadeo Savlaram
Shelke V. Pune Municipal Corporation, 1995 (3) SCC
33 : JT 1995 (2) SC 504. It was there held by
Ramaswamy, J., after ferring to Woodroffe on „Law
relating to injunction, L.C. Goyal „Law of injunctions; David
Bean „Injunction‟ Jayce on Injunctions and other leading
Articles on the subject that the appellant who was a
trespasser in possession could not seek injunction
against the true owner. In that context the Supreme
Court quoted Shiv Kumar Chadha v. MCD, (1993) (3) SCC
161 wherein it was observed that injunction is
discretionary and that
"Judicial proceedings cannot be used to protect or to
perpetuate a wrong committed by a person who
approaches the Court."
His Lordship Ramaswamy, J., also referred to Dalpat
Kumar V. Prahlad Singh, (1992) (1) SCC 719: (AIR 1993 SC
276) in regard to the meaning of the words „prima facie
case‟ and „balance of convenience‟ and observed in
Mahadeo Savlaram Shelke, (1995 (3) SCC 33) (supra) at
p. 39.
"It is settled law that no injunction could be granted
against the owner at the instance of a person in unlawful
possession".
Therefore as pointed by the above decision of the
Supreme Court it is settled law that a trespasser cannot
seek injunction against the true owner. It has been so
held also by several High Courts stating that an injunction
cannot be granted in favour of a person who is a
trespasser against the true owner (Hosiar Sigh v. Gaon
Sabha, 1988 (36) DLT 428). In K.V. Narayan v S. Sharana
Gowda, AIR 1986 Karn. 77, Alamelu Achi v. Ponnaiah, AIR
1962 Mad 149; Biswabam Pvt. Ltd. v. Santosh, (AIR 1964
Cal 235), Bishni v. Bahadur Singh, AIR 1980 All 209;
Padmanabhan v. Thomas, AIR 1989 Ker 188. The above
WP(C)NO.3682/2008 Page 24 of 37
decisions accord with the view taken by the Supreme
Court in Shiv Kumar Chadha‟s case and in Mahadeo
Savlaram Shelke‟s case, (1995 (3) SCC 33).
16. It is argued for the appellant that this may be
anomalous. It is said that the trespasser has a "right" to
an injunction against the true owner, and this is
complementary to the duty of the owner not to evict the
trespasser outside the judicial process. In our view, there
is no anomaly. Each of these is based on a different legal
principle. If the plaintiff wants the defendant to act in
accordance with law he must first abide by the law
himself and vacate the property as one would expect a
law abiding citizen to behave."
23. Learned counsel for the respondent has relied upon Mahadeo
Savlaram Shelke & Others Vs. Pune Municipal
Corporation And Another, reported at (1995) 3 Supreme
Court Cases 33. It will be useful to reproduce paras 9:-
"9.It is settled law that no injunction could be
granted against the true owner at the instance of persons
in unlawful possession. It is true that the appellants
placed reliance in their plaint on resolutions passed by
the Municipality on 11.11.1972 and 29.11.1972. A
reading of those resolutions would prima facie show that
possession would be taken where the acquisition
proceedings have become final and land acquisition
proceedings would not be pursued where award has not
been made as on the date of the resolutions. In this case,
since the acquisition proceedings have become final, then
necessarily possession has to be taken by the Corporation
for the public purpose for which the acquisition was
made. In that context the question arises whether the
appellants can seek reliance on two resolutions. They
furnish no prima facie right or title to the appellants to
have perpetual injunction restraining the Corporation
from taking possession of the building. The orders of
eviction were passed by due process of law and had
become final. Thereafter no right was created in favour of
the appellants to remain in possession. Their possession
is unlawful and that therefore, they cannot seek any
injunction against the rightful owner for evicting them.
There is thus neither balance of convenience nor
irreparable injury would be caused to the appellants.
WP(C)NO.3682/2008 Page 25 of 37
24. Leaned counsel has also relied upon Deep Chand Vs.
Kulanand Lakhera & Ors., reported at 2007, INDLAW Delhi
1123.
25. Learned counsel for the respondents submits that the
judgments relied upon by learned counsel for the petitioner
would not be applicable to the facts of this case for the reason
that the present case pertains to a licence, possession of the
premises was all along with the respondent and further in this
case the rights of the parties are not in dispute; the terms and
conditions have been reduced into writing and the licence deed
is an admitted document. The relationship between the parties
is not in dispute and the said judgments are decisions where
the rights of the parties were disputed or matters related to
tenancy. In this case, petitioner was a licencee and the
possession of the premises continued to remain with the
respondents.
26. Learned counsel for the respondents submits that in the case of
Bishan Das And Ors. Vs. State of Punjab, reported at AIR
1961 Supreme Court 1570, would not be applicable to the facts
of this case, in view of the fact that the Supreme Court had
noticed in paragraph 11 that it was not clear whether a lease
was executed in favour of the firm Faquir Chand Bhagwan Das
or whether it was a licence coupled with a grant or an
irrevocable licence. It is contended that in this case, admittedly,
the parties had entered into a licence, which was for a fixed
period and rights and liabilities of the parties were to be
governed by the licence deed.
WP(C)NO.3682/2008 Page 26 of 37
27. Learned counsel submits that the case of Ram Rattan &
Others Vs. State of Uttar Pradesh, reported at (1977) 1
Supreme Court 188 would also not be applicable to the facts of
this case as the Apex Court had noticed in para 5 of the
judgment that the complainant had encroached upon the land,
in dispute, and had converted it into culturable land and had
grown the paddy crop and he was thus in possession of the
land.
28. Learned counsel also contends that the case of Krishan Ram
Mahale Vs. Ms. Shobha Venkat Rao, reported at JT 1989 (3)
SC 489 would also not be applicable to the facts of this case as
in the said case the right of renewal had remained in favour of
the plaintiff whereas in this case the right of renewal was with
the respondent herein.
29. Learned counsel has also contended that the case of State of
U.P. Vs. Maharaja Dharmander Prasad Singh and Others,
reported at (1989) 2 SCC 505 is not applicable as it does not
pertain to a case of a licence. Licensor in this case was in the
juridical possession of the premises, in question, and to the
extent that even the furniture sought to be purchased for the
premises was to be approved by the respondent herein.
30. In the case of State of West Bengal Vs. Vishnunarayan and
Associates (P) Ltd. and Ors., reported at 2002 SC 1493,
which was relied upon by the petitioner, learned counsel for the
respondent submits that paras 2 and 4 of the aforesaid
judgment would show that the respondents in the said matter
WP(C)NO.3682/2008 Page 27 of 37
were tenants in the shop and the Apex Court had noticed that it
was not disputed that there was a relationship of landlord and
tenants between the parties, and, thus, it was held that the
tenants could not be evicted without due process of law.
31. Mr. Shanti Bhushan, learned senior counsel submits that the
case of R.V. Bhupal Prasad Vs. State of Andhra Pradesh,
reported at AIR 1996 SC 140 would also have no application to
the facts of the present case as the aforesaid matter pertains to
a lease.
32. The submissions of learned counsel for the petitioner can be
summarized as under:-
(1) Although the documents were styled as a licence deed
dated 08.04.2003, however, the nature of transaction
entered into between the parties was in fact a lease
created in favour of the petitioner;
(2) The petitioner was an independent occupant and had free
and uninterrupted use;
(3) The petitioner was given a bare structure and he has
spent several lakhs on renovation, thus, the licence
executed was irrevocable in nature.
(4) The petitioner cannot be dispossessed except by following
due process of law.
33. The submissions of learned counsel for the respondent can be
summarized as under:-
WP(C)NO.3682/2008 Page 28 of 37
(1) Writ petition is not maintainable as petitioner has
approached this court with unclean hands and is not
entitled to any relief;
(2) Petitioner is an illegal occupant as licence has admittedly
come to an end on 07.04.2008;
(3) Petitioner cannot be allowed to perpetuate its illegality in
order to continue its illegal possession;
(4) Court should not, under Article 226 of the Constitution of
India, interfere in contractual relations entered into
between the parties vide licence deed dated 07.04.2003,
which was further renewed on 01.04.2006;
(5) Appropriate remedy available to the petitioner would not
be to claim damages against eviction;
(6) Assuming that the respondents have failed to follow the
due process of law, still the respondents have taken
possession on 10.05.2008;
(7) Rights and liabilities of parties are clear and unambiguous
and reduced into writing;
(8) Petitioner‟s own case before the High Court was that the
licence stood renewed upto 07.04.2008; and
(9) Licence having come to an end, the original
owner/respondent herein is in possession and the
petitioner cannot put back into possession.
34. In the light of the submissions made and the judgments relied
upon by counsel for the parties, is the petitioner entitled to the
reliefs prayed for in this petition? Petitioner has prayed for
WP(C)NO.3682/2008 Page 29 of 37
issuance of a writ of Mandamus, directing the respondents to
execute a licence deed by way of renewal; for issuance of
directions to the respondents to remove their goods and
prohibit the respondents from causing interference in the
peaceful use of the premises. Mr.Ravi Gupta, learned counsel
for the petitioner has submitted that licence deed was in fact a
lease deed as petitioner was in independent possession of the
premises and petitioner was permitted to carry out extensive
renovation for which large amounts were spent and thus the
licence deed was irrevocable. Besides this, petitioner can only
be dispossessed by due process of law.
35. Mr.Shanti Bhushan, learned senior counsel for the respondents
has submitted that parties had signed a licence deed, which
also governed the rights and liabilities of the parties.
Possession of the premises all along remained with the
respondents. No doubt, petitioner was in lawful occupation till
the period of the licence, however, after completion of the
period of licence, petitioner was not in lawful occupation.
Hence, Court should not come to the aid and rescue of a
defaulter.
36. Admittedly, parties had executed a licence deed on 8.4.2003,
initially for a period of three years, commencing from 8.4.2003
and expiring on 7.4.2006. At the request of the petitioner
licence was further renewed for another period of two years.
The rights and liabilities of the parties are governed by this
document. Aggrieved by the communication dated 14.9.2006
issued by respondent, proposing to terminate the licence
WP(C)NO.3682/2008 Page 30 of 37
agreement dated 1.4.2006, petitioner had filed a suit bearing
No.2308/2006 for declaration and injunction. Copy of the plaint
has been filed on record. According to the plaint, there was no
occasion for the respondent to issue the impugned letter after
having entered into a contract with the plaintiff to licence the
premises for a fixed period of two years. The plaint further
goes on to state that parties held negotiations after which a
licence deed was executed on 8.4.2003. In the suit the plaintiff
relied upon the initial licence which was subsequently renewed
on 8.4.2006 upto 7.4.2008. The petitioner had entered into a
licence deed on 8.4.2003 and subsequently at their request the
same was renewed for another period of two years on 8.4.2006.
37. The argument sought to be raised in the present proceedings
with regard to the transaction entered into between the parties
being a lease or that the licence executed was irrevocable in
nature should have been raised at the very first opportunity
available or at least when the petitioner filed a civil suit in this
Court, however, in the plaint petitioner had relied upon the
terms of the renewed licence deed.
38. The petitioner entered into this relationship with the
respondents with open eyes, the only declaration sought in the
suit was declaring communication dated 14.9.2006 proposing to
terminate the licence agreement as bad, illegal and void. No
declaration was sought that the licence deed was in fact a
lease. Neither any such grievance was made. The petitioner
had entered into a contractual relationship and this relationship
is purely governed by law of contract. By clause 3 duration of
WP(C)NO.3682/2008 Page 31 of 37
the licence deed has been fixed. Clause 4 deals with the
renewal of the licence deed. Based on clause 4 the petitioner
had sought renewal which was granted for another period of
two years. As per clause 6, the rights conferred on the
petitioner were only that of a licencee and possession of the
premises was of the licensor. Licencee was only entitled to a
right of use and occupation and no other right whatsoever. The
same very clause expressly stated that the document was not a
lease and the relationship between the parties was only of a
licensor and licensee and not that of a landlord and tenant. To
say that the petitioner had carried out renovations as well as
incurred huge expenses in making changes that by itself would
make the licence irrevocable, is a submission without any force
and basis. Clause 12 of the licence permitted the licencee to
carry out the interior decoration, but only at its own costs and
only after getting the plans and overall designs approved by the
General Manager. Thus once having derived the benefit of the
document dated 8.4.2003 which was renewed for another
period of two years on 8.4.2006, at the request of the
petitioner, at this stage, it is not open for the petitioner to state
that the document was in fact a lease deed or that the licence
was irrevocable. In any case in the present proceedings which
are summary in nature under Article 226 of the Constitution of
India this question cannot be agitated as it requires detailed
examination of evidence.
39. The Supreme Court of India in a catena of judgments has
repeatedly held that even a trespasser can only be removed by
WP(C)NO.3682/2008 Page 32 of 37
due process of law. In support of this proposition, learned
counsel for the petitioner has relied on various decisions which
have been noticed by this Court.
40. A bare reading of the documents placed on record particularly
the licence deed, would show that the petitioner was only a
licensee. The licence was granted for a period of three years,
which was extended for another period of two years. The period
of licence has come to an end on 7.4.2008. The respondent by
a communication dated 14.9.2006 had sought to terminate the
licence agreement which forced the petitioner herein to file a
suit for declaration and injunction and the ground taken was
that the licence stood renewed upto 7.4.2008. So the admitted
position which emerges is that the licence came to an end on
7.4.2008. As per clause 4, this licence could be renewed at the
option of the licensor, in its discretion, which was not done.
41. Clauses 14 and 56 of the Licence Deed also make it clear that
the licensed premises shall at all times be under the control and
supervision of the licensor, thus it cannot be said that the
respondent was in legal occupation after the period of licence
came to an end. Under these circumstances, when admittedly
the period of licence had expired and petitioner even thereafter
continued to occupy the licensed premises, should the court
interfere and come to the aid and rescue of such a petitioner.
The answer is certainly in the negative. Once the period of
licence comes to an end, it is the owner of the premises who
would be in lawful possession of the premises. In view of the
agreed terms of the licence deed, it cannot be said that the
WP(C)NO.3682/2008 Page 33 of 37
petitioner was in legal or settled possession thus making the
case of the petitioner different to the case of a tenant or a case
where the termination was pre-mature. The petitioner in his
own wisdom had withdrawn the suit No.2308/2006, which was
filed, on the statement made by counsel for the respondent
/defendant that the agreement had run out of its course during
the pendency of the proceeding. Arguments raised and
submissions made by counsel for the petitioner are similar to
the arguments raised in the case of Chandu Lal Vs. MCD
(Surpra), wherein kiosks were given on licence for a period of
eleven months. After completion of the period of licence, the
Corporation had enforced its right of re-entry, which was
challenged and ultimately came up for decision before a Full
Bench. The Full Bench had observed that the Corporation in
enforcing its right of re-entry cannot be said to have taken the
law in its own hand as the underlying assumption in the case of
a licence is that the owner continues to be in possession and
control of the property. The Court had declined to throw its
protection round the trespasser. The position in this case is no
different.
42. Petitioner entered into a licence agreement with respondent
no.1 initially for a period of three years on 8.4.2003. At the end
of the term of the licence petitioner made a request for renewal
of the licence and at his request the licence was renewed for a
period of two years w.e.f. 8.4.2006 to 7.4.2008. The
respondent no.1 had sought to terminate the licence before the
expiry of the period of two years by a communication dated
WP(C)NO.3682/2008 Page 34 of 37
14.9.2006, which was subject matter of a Civil Suit
[CS(OS)No.2308/2006]. The petitioner had relied upon the
licence deed and sought protection from the High Court on the
ground that the licence stood renewed up to 7.4.2008 and the
same could not have been terminated during the period of
licence. Having placed reliance on this document, the High
Court had granted interim protection to the petitioner. Even at
the stage of filing the suit in the High Court the petitioner did
not challenge any of the terms of the licence deed and did not
raise the argument which is sought to be raised at this stage
that the licence deed was in fact a lease and that even licence
was irrevocable. Once the period of licence expired, the
petitioner withdrew the Civil Suit [CS(OS)No.2308/2006], and
filed the present writ petition.
43. A bare reading of the licence deed would show that the licence
was not renewed after 7.4.2008 and thereafter the petitioner
had no right to continue with the possession over the licensed
premises. The relationship between the parties was purely
governed by the licence deed which was executed between the
parties. As per clause 4 of the licence agreement, licence could
be renewed at the sole option of the licensor - respondent no.1
herein. As per clause 6 of the licence agreement it was clearly
understood between the parties that the right conferred by the
document is only that of a licencee and also that the possession
of the premises would lie with the licensor and that the licencee
would only have right to use and occupy the portion - licenced
premises - and no other right whatsoever. The parties agreed
WP(C)NO.3682/2008 Page 35 of 37
that the document executed between them was not a lease and
the relationship between the parties was only that of licensor
and licencee and not that of a landlord and tenant. Any
renovation which was carried out by the licencee was governed
by clauses 12 and 14 of the licence agreement executed
between the parties. As per clause 49 of this licence deed on
termination of the licence, the licencee would have no right
under the licence and also have no right to enter the premises
of the hotel, as a licensee. As per clause 56 parties agreed that
the licensed premises shall at all times be under the control and
supervision of the licensor and the licensor shall retain domain
and possession of the licensed premises and would also have
the right to direct the mode and manner of the use of the said
licensed premises. The terms of the licence make it abundantly
clear that the licensor continue to remain in possession and
control of the premises and in such circumstances the Court
cannot throw its ring of protection around the petitioner, who is
a defaulter and once the terms of the licence came to an end,
his occupation over the premises is unlawful. Any protection
granted to the petitioner by this Court in these proceedings
would amount to putting premium on the defaults of the
petitioner and would result in allowing the petitioner‟s
continuous use and occupation over the premises beyond the
term of a written document signed and executed between the
parties. In other words, while the illegal occupant would enjoy
the property, the true owner would seek aid of the court,
WP(C)NO.3682/2008 Page 36 of 37
besides that, this would be against the very terms and
conditions of the licence.
44. There is no doubt that the petitioner was in lawful occupation of
the premises during the period of licence. The possession
however, continued to remain with the respondent, as per the
terms of the licence which is an admitted document. This very
document was the basis on which the petitioner had filed a suit
for declaration and injunction and derived the benefit of interim
protection. The same very document has to be interpreted at
this juncture as well.
45. Defaulters, such as the petitioner, have already flooded the
Courts with frivolous litigations, they cannot be permitted to
further block the stream of justice, in this manner. Petitioner
had entered into a licence deed with open eyes, knowing fully
that the duration was three years, which was renewed for
another period of two years at the sole option of the
respondent. Learned counsel for the petitioner has not been
able to show any right accrued in its favour which would entitle
the petitioner to use the premises thereafter. In these
circumstances petitioner is not entitled to any relief in these
proceedings. Accordingly, petition stands dismissed with no
order as to costs.
G.S. SISTANI, J.
July 01, 2009 'ssn' WP(C)NO.3682/2008 Page 37 of 37