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PETITIONER: NATIONAL TEXTILE CORPORATION (SM) LTD.

       Vs.

RESPONDENT: ASSOCIATED BUILDING CO. LTD. & ORS.

DATE OF JUDGMENT31/10/1995

BENCH: PARIPOORNAN, K.S.(J) BENCH: PARIPOORNAN, K.S.(J) BHARUCHA S.P. (J) KIRPAL B.N. (J)

CITATION:  1996 AIR  403            1995 SCC  Supl.  (4) 197  JT 1995 (7)   619        1995 SCALE  (6)161

ACT:

HEADNOTE:

JUDGMENT:                       J U D G M E N T PARIPOORNAN. J. 1.   The third respondent in Writ Petition No.270/84 -- High Court of  Bombay, M/s.  National Textiles Corporation (South Maharashtra) Limited,  Bombay, the  appellant in this appeal assails the  judgment of the High Court rendered in the said Writ Petition dated 20.7.1993 2.   The Associated  Building Company  Limited, Bombay,  (2) Ahmedabad  Advance   Mills  Company   Limited,  Bombay,  (3) Swadeshi Mills  Company Limited,  Bombay, (4) Central Indian Spinning, weaving  and Manufacturing Company Limited, Bombay and (5) The Tata Mills Limited, Bombay (5 petitioners) filed Writ Petition No.270/84 in the High Court of Bombay, praying amongst other  reliefs, for the issue of a writ of mandamus, prohibiting the respondents in the Writ Petition from taking any action to take over possession or control of any area of "Bombay House".  The respondents  in the Writ Petition are - (1) The  Union of  India, (2)  National Textile  Corporation Limited, New  Delhi, (3) National Textile Corporation (South Maharashtra) Limited,  Bombay (the appellant herein) and (4) Shri M.N.  Acharya. In  this appeal, the five petitioners in the Writ  Petition are  respondents 1  to 5,  the  Union  of India, the  National Textile  Corporation Limited, New Delhi and Sri  M.N. Acharya (respondents No. 1,2 and 4 in the Writ Petition) are respondents 6,7 and 8. 3.   For convenience  sake, in  this Civil  Appeal  we  will refer to  the parties  as  they  are  arrayed  in  the  Writ Petition. 4.   Petitioner  No.1,   the  Associated   Building  Company Limited is  the owner  of building  known as  "Bombay House" situate at  Homi Mody Street, fort, Bombay. Petitioner No.5, the Tata  Mills Limited  is a public limited company engaged in the  manufacture of cotton textiles and yarn. Petitioners No.2 to  4 are  also public  limited companies  engaged in a

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variety of  business. The  Tata Mills  Limited is located at Dadar, Bombay.  Petitioner No.1 had permitted the Tata Mills Limited and  also petitioners  No.2 to  4 to  use a  part or portion of  Bombay House  as their  registered office. It is also seen  that petitioners  No. 2  to 5  were  collectively known as  Tata Textiles.  The petitioners  averred  that  no specific space  or area was delineated or demarcated for the use of  Tata Mills  Limited (petitioner  No.5) in the Bombay House premises. The arrangement was a fluid and flexible one depending upon business need and exigencies. Petitioner No.1 used  to  recover  the  amount  of  compensation  from  Tata Textiles and the amount was contributed by petitioners No. 2 to 5  and the  share of  the  Tata  Mills  Limited  came  to approximately Rs.468.30  per month,  with effect from April, 1982, Tata  Mills Limited ceased to make any payment for the use of the space in Bombay House. The amount payable by Tata Mills Limited was contributed by petitioners No. 20 to 4 and the Tata  Mills Limited  was permitted  to use  the space in Bombay House  gratuitously. The  Tata Mills  Limited had  no right to continue to remain in any part or portion of Bombay House. The  Tata Mills  Limited shifted  their  office  with effect from  2.1.1984  to  Army  and  Navy  Building,  Fort, Bombay. 5.   They Textile  undertaking (Taking  Over of  Management) Ordinance,  1983   which  was   replaced  by   the   Textile Undertakings  (Taking   Over  of   Management)  Act,   1983, (Hereinafter referred to as ‘the Act’) vested the Management of 13  textile undertaking  in the  Central Government.  The Tata Mills  Limited was one of the undertakings specified as No. 13  in the  first schedule to the Act. The management of the 13  specified textile  undertakings  so  vested  in  the Central Government  was taken over by the Central Government on 19.10.1983.  By virtue  of Section 4 of the Act, National Textile Corporation  Limited was  appointed as Custodian and National Textile Corporation (South Maharashtra) Limited was appointed  as   Additional  Custodian.  Shri  M.N.  Acharya, respondent No.4  is the  authorised  representative  of  the Custodian. 6.   By  communication  dated  16.1.1984  (Ex.-A),  the  3rd respondent, National Textile Corporation (South Maharashtra) Limited intimated  the Tata  Mills Limited, Petitioner No.5. that Additional  Custodian has appointed and authorised Shri M.N.Acharya to  take immediate possession and control of the property of Tata Mills Limited office at Bombay House, Fort, Bombay. The  5th  petitioner,  the  Tata  Mills  Limited  by communication dated  18.1.1984  (Ex.-B)  intimated  the  3rd respondent that  the entire Bombay House premises belongs to petitioner  No.1  and  the  Tata  Mills  Limited  have  been permitted by  the owner  only to use part of the said Bombay House premises  as a  registered office  along with  3 other mills (petitioners  No. 2 to 4), and that they have not been allotted any  specific part  or portion of the said premises and since  October 1982  they are  continuing to  occupy the registered  office  gratuitously,  as  borne  out  from  the records of  the company. Petitioner No.5 clarified that they have no  right, title  or interest  whatsoever in the Bombay House  on   any  part   or  portion   thereof  and  in  such circumstances, the  registered office does not form any part of the  Textile Undertaking over which the Custodian has any right. Petitioner  No.1  by  communication  dated  18.1.1984 (Ex.-C), wrote  to the  3rd  respondent  in  similar  terms, highlighting the  fact that  no specific  portion  has  been allotted to the Tata Mills Limited in Bombay House, that the mills had  stopped paying  compensation in  respect  of  the joint use  of the  portion of the Bombay House and from July

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1982,  were   using  the  premises  only  gratuitously.  The petitioner also asserted that the Tata Mills Limited have no right, title  on interest  whatsoever in Bombay House or any portion  thereof.  No  reply  was  sent  to  the  above  two communications of  petitioners No.  1  and  5,  by  the  3rd respondent. Apprehending that the respondents, as threatened in their  letter dated  16.1.1984, may  seek immediate  take over of  the possession and control of the registered office of the  Tata Mills  Limited in the premises of Bombay House, and if  it so  ensues, it  will subject  the petitioners  to irreparable harm  and  hardship  and  harassment,  the  writ Petition was filed by petitioners No.1 to 5, seeking amongst others, the following relief :-      "(a) For a Writ of Mandamus or a   Writ      in the nature of Mandamus or any other      appropriate writ,  direction or order as      to this Hobble Court appears just and      proper, in the circumstances of the      case, prohibiting and restraining the      Respondents, their  agents, servants and      subordinates from taking any action of      any description directly or indirectly      for take over of the possession and/or      control of the said space/area at Bombay      House or any part thereof and/or      ordering and directing the Respondents      their agents,  servants and subordinates      not to take any action of any      description, directly  or indirectly for      take over of the possession and/or      control of the said space or area at      Bombay House  on any part thereof and/or      any of the furniture, fixtures,      instruments, machines, equipments,      automobiles and  other vehicles and good      on or about the said premises." Respondents No.3  and 4 filed Counter affidavits in the High Court. After  perusal of  the relevant records placed before the Court  and on  hearing parties,  a Division Bench of the Bombay High  Court, by  its judgment  dated 20.7.1993,  held that the  action of the respondents by addressing the letter dated  16.1.1984   seeking   possession   and   control   of unspecified portion of Bombay House is without jurisdiction, and consequently,  the petitioners  are entitled  to relief, and the rule was made absolute in terms of prayer (q) quoted hereinabove. It  is from  the  aforesaid  judgment  the  3rd respondent in  the  Writ  Petition  has  filed  this  appeal impleading petitioners  No. 1 to 5 and respondents 1,2 and 4 as respondents 1 to 8. 7.   The plea  of the  appellant before  the High  Court and still before  us is  that under  Section 3(1) and (2) of the Textile undertakings  (Taking over  of management) Act, 1983 (Act  No.40   of  1983),   the  management  of  the  Textile Undertaking, namely,  the Tata  Mills Limited,  Dr. Ambedkar Road, Bombay  vested in  the Central  Government and  so the area/space in  Bombay House wherein the registered office of the Tata  Mills Limited  functions has vested in the Central Government and  so the  custodian  was  authorised  to  take possession and  control of  the property  of the  Tata Mills Limited at  Bombay House.  It will be useful to bear in mind the relevant provisions of Act 40 of 1983 :      2.   (a) ..............      (b) .................      (c) .................      (d)  ’textiles undertaking’ or "the

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    textile undertaking" means an      undertaking specified in the second      column of the First Schedule;      "3. (1)   On and from the appointed day,      the management of all the textile  under      taking shall vest in the Central      Government.      (2)  The textile undertaking shall be      deemed to include all assets, rights,      leaseholds, powers, authorities and      privileges of the textile company in      relation to the said textile undertaking      and all property, movable and      immovable,including lands, buildings,      workshops, projects, stores, spares,      instruments,machinery, equipment,      automobiles and other vehicles, and      goods under production or in transit,      cash balances, reserve fund, investments      and book debts all other rights and      interests in or arising out of such      property as were, immediately before the      appointed day, in the ownership,      possession, power or control of the      textile company whether within or      outside India  and all books of account,      registers and all other documents of      whatever nature relating thereto."      "14(1)    Any person who, -      (a)  having in his possession or custody      or under his control any property      forming part of any of the textile      undertakings, wrongfully with holds such      property from the Custodian or any      person authorised under this Act, or      xxx      xxx       xxx              xxx      (d)  wilfully withholds  from, or  fails      to deliver to, the Custodian or any      person authorised under this Act, any      books, papers or other documents      relating to such textile undertaking      which may be in his possession, power or      custody or under his control, or      (e)  Fails, without any reasonable      excuse, to furnish information or      particulars as provided in section 4,      shall be punishable with imprisonment      for a term which extend to two years, or      with fine which may extend to ten      thousand rupees, or with both." 8.   The definite  case or  the petitioners  throughout  was that petitioner No.5 the Tata Mills Limited was permitted to use the (undetermined or undemarcated) space in Bombay House gratuitously and  the Mills  had no right, title or interest whatsoever to  remain in  any part  or portion of the Bombay House. The  circumstance that  led to  that  arrangement  as detailed in  the Writ  Petition was  Put-forward before  the High Court, to contend that since the Tata Mills Limited had no right,  title or  interest whatsoever in the Bombay House or any  part thereof,  no question of handing over or taking over possession  of any  part or portion of the Bombay House through  the  Custodian  or  his  authorised  Representative arose. This  was specifically  stated by  petitioner No.5 in its reply  dated 18.1.1984  to the  notice received from the 3rd respondent  (the appellant  herein) dated  16.1.1984. In

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the said reply the petitioner No.5 stated, thus :      "The entire  Bombay House belongs to the      Associated Building Co. Ltd. We have      been permitted by the owner,  The      Associated Building Co. Ltd., to use      part of the said Bombay  House  premises      as registered office     along with  the      registered offices of other three Mills,      namely, the    Ahmedabad Advance Mills      Ltd., the Swadeshi Mills Co. Ltd., and      the  Central India  Spinning Weaving and      Manufacturing Co. Ltd.      We however, have not been allotted any      specific part or portion of the said      premises as  registered office. In fact,      since October  1982 we have been allowed      to continue our registered office      gratuitously. The records of the Company      will bear out this fact.      Under the Circumstances, we wish to      clarify that our Company has no right      title or interest whatsoever in the      Bombay House or any part or portion      thereof of which possession   could be      handed over to you or your    representa      tive. In any event the registered office      of our company does not from part of the      Textile Undertaking over which the      Central Government  or Custodian has any      right."                          (Emphasis supplied) Petitioner No.1,  the owners of the property "Bombay House", in their  communication dated  18.1.1984 to  respondent No.3 (the appellant herein) stated thus:      "Re: Tata Mills Office at Bombay      House.      We are informed by Tata Mills Limited      that you have called upon     them to      hand over immediate possession and      control of their office at Bombay House,      Fort, Bombay.      We wish to clarify that we are the      owners of the said property "Bombay      House". We have allowed the Tata Mills      Limited, The Swadeshi Mills Company      Limited, The Ahmedabad Advance Mills      Company Limited, and the Central India      Spinning Weaving and Manufacturing      Company Limited to have their registered      offices in the Bombay House premises. No      specific portion has been allotted and      allowed to be used by any of the said      Mills including Tata Mills Limited.      Since July  1982 Tata Mills Limited have      stopped paying any compensation in      respect of the joint use of portion of      the Bombay House premises. From July      1982 onwards Tata Mills Limited has been      using the premises gratuitously. These      facts can be verified from the records      of the said Company.Tata Mills Limited      has no right, title or interest      whatsoever in  Bombay House  premises or      any part or portion thereof.      No part or portion of Bombay House

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    premises vest  in the Central Government      or the  Custodian. We submit you have no      right whatsoever to take possession      thereof. We  trust you will not take any      action regarding Bombay House premises      as mentioned in your letter dated 16th      January, 1984 addressed to Tata Mills      Limited."                          (Emphasis supplied) It is  common ground  that the  respondent did  not send any replay to the above communications sent by petitioners No. 1 and 5.  It is  significant to  note that  the  plea  of  the petitioners,  that   the  Tata   Mills  Limited  was  (only) permitted  gratuitously   to  occupy   the   undivided   and undemarcated  portion   of  the   Bombay  House,  was  never controverted specifically  by the  respondents either in any communication or  in the counter affidavits filed before the High Court.  In the  above circumstances, the short question which fell  for determination  before the  High  Court  was, whether the occupation of undivided and undemarcated portion of the  Bombay House  by the Tata Mills Limited amounts to a right, power  or authority  or privilege  so as  to vest the said right in the Custodian. 9.   We should  remember that  the management  of  the  Tata Mills Limited  was taken  over  on  1.10.1983.  Nearly  four months thereafter, by communication dated 16.1.1984, the 3rd respondent intimated the Tata Mills Limited of its intention to take  immediate possession and control of the premises in the Bombay  House. In  replay thereto  petitioner No.  5  by communication dated  18.1.1984 positively  asserted that the Tata Mills  Limited have  not  been  allotted  any  specific portion or  part in  Bombay House  and they  were allowed to continue the registered office only gratuitously and it will be  borne   out  from   the  records  of  the  company.  The respondents did  not make  any attempt to verify the records of  the  company  to  ascertain  whether  the  statement  of petitioner  No.  5  contained  in  its  communication  dated 18.1.1984, is  true, viz  that the  Tata Mills  Limited  was using the premises in the Bombay House gratuitously and that no specific  portion was  allotted or  allowed to be used by the said Mills. 10.  The High  Court held  that the  plea of the respondents that the Tata Mills Limited was occupying the portion of the Bombay House  as Lessee  (tenant) is  based on  no material. Indeed it  was so  conceded before  the High  Court. It  was father found that even on the assumption that the Tata Mills Limited was  permitted to  occupy the  portion of the Bombay House ,  as licensee,  it is  only a personal right which is neither  heritable   non  transferable   and  there   is  no enforceable right  in the Tata Mills Limited in that behalf. It was  held by  the High  Court, that  it will be futile to suggest that  the Tata  Mills Limited  had any asset, power, authority or  privilege as  contemplated by  Section 3(2) of the  Act  to  authorise  the  custodian  to  take  over  the possession of  any portion of the Bombay House. In the Final analysis, the  occupation by  the Tata  Mills Limited  of  a portion of  the Bombay House gratuitously was found to be an unenforceable  right   and  so   the  communication  of  the custodian dated  16.1.1984 seeking possession and control of unspecified portion  of Bombay House, was held to be without jurisdiction. 11.  We heard  learned Additional Solicitor General Mr. V.R. Reddy, who  appeared on behalf of the appellant and Mr. Soli J. Sorabjee,  Senior Counsel,  who appeared on behalf of the respondents. Mr.  Reddy assailed  the judgment  of the  High

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Court on the following grounds. (1)       The rival pleas out forward by the parties, were           based on factual matters and some of them required           evidence, in support thereof. In such   circumstan           ces, the High Court should have declined to           exercise its  discretionary jurisdiction vested in           it under Article 226 of the Constitution of India.           At any rate the matter required a detailed           adjudication and  so, the parties may be relegated           to the ordinary remedy available at law to seek           redress. (2)       Even on the merits, the High Court was in error in           holding that no enforceable right vested in the           Custodian under Section 3(2) of the Act to take           possession of  the premises wherein the registered           office of  the Tata Mills Ltd. in Bombay House was           located.           On the  other hand,  Mr. soli  J.Sorabjee, Counsel for petitioners 1 to 5 submitted that the maintainability of the Writ  Petition was not put forward before the High Court either in  the counter-affidavits failed on during arguments and on  the basis  averments  contained  in  the  affidavits filed, parties  joined issue and argued the matter. It is no longer open to the appellant to contend that the parties may be relegated  to the ordinary remedy at law to seek redress. He further  contended, that  on merits,  the High  Court was justified in  holding that  the Tata  Mills Limited  had  no enforceable  or  definite  right  in  the  space  where  the registered office  was located  in Bombay  House and  so the Controller was  incompetent and could not seek possession on control or unspecified portion of Bombay House. 12.  The affidavits  filed in  the case  disclose that  when petitioners  No.1   and  5   were  informed  that  immediate possession and  control of  the Tata  Mills office at Bombay House will  be taken, they promptly replied by communication dated 18.1.1984  that no  specific part  or portion  of  the Bombay House was allotted to the Tata Mills Limited, and the Mills  were   allowed  to  continue  the  registered  office gratuitously and  the records  of the  company will bear out this fact.  The respondents were also informed that the Tata Mills Limited have no right, title or interest whatsoever in any portion  of the  Bombay House which could be handed over or taken  possession of  by the Custodian. The over or taken possession of by the Custodian. The respondents did not care to verify  the records  of the company. The appellant should have gathered material to know the nature of the arrangement by which the registered office of the Tata Mills Limited was functioning in  the Bombay House. Since the entire assets of the Tata  Mills Limited  had vested  in the  Government, the records should  be available  with the  Custodian. He  could have verified  the records.  He could  have asked petitioner No.1 to  produce relevant records, if any, available with it in that regard. When objection was taken regarding the basis facts, one  would normally  expect the respondents to verify the records  and then only to proceed further in the matter, or to  stay their  hands and  intimate the parties concerned that they  will proceed only in accordance with law. This is the appropriate  procedure to  be adopted  by any  public on statutory authority  placed in  similar  circumstances.  The respondents  totally   failed  to   do  so.   Such  inaction necessarily led  to the  filing of the Writ Petition. We are of the view that the Writ Petition filed by petitioners No.1 to 5,  in the  circumstances, is  really a defensive action. The fact  that petitioners  No.1 to  5  figured  nominee  as Petitioners in  the Writ Petition, is irrelevant. The burden

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is on  the respondent  to prove  that the Tata Mills Limited had any definite and enforceable right in Bombay House which vested in  the respondents  under Section  3 of  the Act and capable of being enforced. This is a basic or jurisdictional fact which  should have  been proved by the respondents. The plea put  forward by  the respondents that the occupation of the Tata  Mills Limited  if a portion of the Bombay House as tenants or  that they  had any enforceable right or power or asset,  was   not  based   on  any   material.  IT  was  not substantiated at  all. The plea of the petitioners stated in their communications  dated 18.1.1984  and reiterated in the Writ  Petition,   was   not   dis-proved,   in   the   above circumstances, the  High Court,  in our  opinion,  correctly reached the conclusion that the action of the respondents by addressing the letter dated 16.1.1984 seeking possession and control of  unspecified portion  of Bombay House, is without jurisdiction. 13.  We are of the opinion that the respondents have totally failed to  prove that  there was  any enforceable  right  or interest of the Tata Mills Ltd. in any portion of the Bombay House, and  in the  circumstances, no part or portion of the Bombay House,  formerly occupied  gratuitously by  the  Tata Mills  Limited,  vested  in  the  Central  Government  under Section 3  of the  Act. The assumption by the respondents to the contrary is not justified in law. 14.  It is significant to note that no plea was taken in the counter affidavits  filed by  the respondents that the Write Petition is  not maintainable  or that  further evidence  is required to  be taken  to adjudicate  the  rival  pleas  put forward by  the parties.  We reject the plea so urged before us for the first time in this appeal. Having chosen to fight to case  on the  basis of  affidavits, it is not open to the appellant to  contend that  factual aspects involved leading of  evidence   and  the  High  Court  should  have  declined jurisdiction under Article 226 of the Constitution. The plea that the  occupation of  the Tata Mills Limited of a portion of the Bombay House was as a tenant or lessee or licensee or that there  existed any  power or  asset,  is  based  on  no material,  but   mere  assertion.   Respondents  had   every opportunity to  verify the  relevant  records  to  ascertain under what  arrangement the Tata Mills Limited was occupying the undivided  and undemarcated  portion of the Bombay house for its registered office. Normally, the records of the Tata Mills Ltd.  should  be  with  the  Custodian.  Even  if  the relevant records  were not  available, the respondents could have required  of petitioner  No. 1  or petitioner No. 5, to produce whatever  records were available with them, to probe into the matter further. They failed to do so. Instead, they acted at  their ipse  dixit  to  take    possession  of  the premises in  Bombay House. This was totally unreasonable and unjustified. So.  on a consideration of the entire facts and circumstances, we  are of  opinion that  the High  Court was justified in  exercising the jurisdiction vested in it under Article 226  of the Constitution. On merits, the respondents have no  case either.  We, therefore, affirm the judgment of the Bombay  High Court  dated  20.7.1993  and  dismiss  this appeal. However, there shall be no order as to costs in this appeal.