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CASE NO.: Appeal (civil)  2903 of 2007

PETITIONER: Depot Superintendent H.P.Corpn. Ltd. & Anr

RESPONDENT: Kolhapur Agri. Market Commtt. Kolhapur

DATE OF JUDGMENT: 20/06/2007

BENCH: Dr. ARIJIT PASAYAT & ALTAMAS KABIR

JUDGMENT: J U D G M E N T  

CIVIL APPEAL NO.      2903           OF 2007 (Arising out of SLP (C) No. 6841 of 2005)

Dr. ARIJIT PASAYAT, J.

1.      Leave granted.

2.      Challenge in this appeal is to the order passed by a  learned Single Judge of the Bombay High Court dismissing the  Second appeal filed by the appellant. While issuing notice on  11.4.2005 it was indicated that the appellant has to indicate  whether he is willing to accept the suggestions given by the  High Court about vacating the premises by 2009.

3.      Background facts in a nutshell are as follows:

Appellant is running a retail outlet Petrol Pump in the  suit premises in Kolhapur for which a lease was executed on  28.12.1959 between the predecessor in interest of the  appellant and the respondent for a period of 20 years with an  option of renewal for a further period of ten years.  The period  expired in December, 1989.  On 18.3.1989 i.e. prior to the  expiry of the lease period, the appellant purportedly exercised  the right of renewal of the lease deed for a period of 30 years in  terms of Section 7 read with Section 9 of the Caltex  (Acquisition of shares of Caltex) Oil Refining (I) Ltd. and of  undertaking in India of Caltex (I) Ltd. Act, 1977 (hereinafter  referred to as "the Acquisition Act").

       According to the appellant, the respondent by its conduct  agreed to extend the lease by accepting rent on 2nd December,  1997.  On 22nd October, 1997 respondents have been noticed  by the appellant-Corporation calling upon the Corporation to  vacate the suit land and hand over the possession to the  respondent.  Respondent filed Civil Suit No. 399 of 1998 with  the Court of Civil Judge, Junior Division Kolhapur on  18.4.1998 inter alia praying for possession of the suit land  and mesne profit on the ground that though the respondent  served upon the appellant the notice of surrender of   possession of land, the appellant avoided giving back the  possession.

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       Learned Civil Judge decreed the suit and directed the  appellants to hand over vacant possession. Appellants filed  Regular Civil Appeal (Regular Civil Appeal No. 375 of 2000)  before the learned District Judge Kolhapur.  During pendency  of the Civil Appeal appellant filed an application under Order 6  Rule 17 of the Code of Civil Procedure, 1908 (in short the  ’CPC’) seeking inter alia the following amendment:

(i)     By virtue of the Acquisition Act, and the provisions  made thereunder, Caltex India Ltd. was converted  into Hindustan Petroleum Corporation Ltd. (ii)    As per Section 7 of the Acquisition Act, the  Corporation has legal right to renew the lease on the  same terms and conditions after its expiry. (iii)   The Corporation by its letter dated 18.3.1989 had  intimated to the plaintiff regarding its desire to  renew the lease for a further period of 30 years.  So  automatically the lease period has been extended  for 30 years. (iv)    The suit filed on the basis of the said notice has no  legal force.

4.      By order dated 2.11.2002 the amendment was allowed.  

5.      By order dated 4.10.2004 the Civil appeal was dismissed.   Second appeal was filed by the appellant before the Bombay  High Court.  By the impugned order the High Court dismissed  the second appeal.    6.      During the hearing of the appeal to avoid litigation  between two public bodies the High Court suggested that the  appellants may be granted time to vacate the suit plot subject  to filing of undertaking but the appellant refused to accept the  situation.  Under Section 7(3) as noted by the High Court there  is no automatic renewal and there can be renewal if it is so  desired by the Central Government.  In the instant case the  other crucial question was whether the company was entitled  to second renewal.  The High Court held that option of renewal  was exercised in the year 1978 at that time the provisions of  the Act of 1977 were already enforced.

7.      During the pendency of the appeal the appellants  contended that they are entitled to benefit of Section 7(3).   That plea is unacceptable as no reply was sent to the notice of  termination and/or by referring to such right in the written  statement filed in the trial court. If in the year 1979 i.e. on the  expiry of the lease period, even if lease was to be renewed in  terms of Section 7(3), extension could have been granted in  terms of original lease for a period of 20 years from the year  1979.  It is to be noted that the appellants are not entitled to  the protection of Maharashtra Rent Control Act, 1999.   Accordingly, the High Court held that there was no merit in  the appeal which was dismissed.

8.      Stands before the High Court were reiterated in this  appeal.  

9.      Section 7(3) reads as follows:

"7(3) On expiry of the term of any lease,  tenancy or arrangement referred to in sub  section (1) or sub section (2), such lease or  tenancy or arrangement shall, if so desired by  the Central Government, be renewed or  continued, so far as may be, on the same

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terms and conditions on which the lease or  tenancy or arrangement was originally granted  or entered into."

10.     As rightly observed by the High Court that there is no  automatic renewal and there can be renewal only if it is so  desired by the Central Government. There is no material  placed before the courts below that there was any desire in  that regard by the Central Government. The appeal is,  therefore, sans merit and deserves to be dismissed. But in  terms of the notice dated 11.4.2005 time for handing over the  possession is extended up to end of June, 2009.  Undertaking  in that regard shall be filed within two weeks from today. If the  undertaking is not filed, this order shall not be operative.

11.     The appeal is accordingly disposed of.