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IN THE SUPREME COURT OF INDIA

CIVIL  APPELLATE JURISDICTION

CIVIL APPEAL NO. 6120  OF 2008

(Arising out of S.L.P.(C) No. 4893/2007)

BENGAL PROPERTIES PVT. LTD. ... APPELLANT(S)

:VERSUS:

FEROZE BELAL AND ORS. ... RESPONDENT(S) WITH

CIVIL APPEAL NO. 6121  OF 2008

(Arising out of S.L.P.(C) No. 6161/2007)

O R D E R

S.L.P.(C) No. 6161/2007:

Leave granted.

Having heard Mr. Mukherjee, learned counsel appearing on behalf  of the

appellants and Mr.  Tapas  Ray,  learned senior counsel  appearing on behalf  of the

respondents, we are of the opinion that without going into the respective merits and

contentions raised before us, interest of justice would be subserved if  the appellants

are granted liberty to prefer an appeal before the Appellate Tribunal of the Calcutta

Municipal  Corporation  from the  order  dated  29.11.2004 passed  by  the  Municipal

Commissioner.

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The Appellate Tribunal shall consider the question relating to condonation

of  delay in preferring such appeal in terms of provision of or akin to Section 14 of the

Limitation  Act,  1963  as  the  appellants  had  been  pursuing  its  remedy  before  the

Calcutta High Court and this Court.   

The Tribunal  is  hereby directed to hear out and dispose of the appeal as

expeditiously as possible, preferably within a period of six months from the date of

preferring the appeal. The appellants must file the memo of appeal within two weeks

from date with an appropriate application for condonation of delay.

However, the order of attachment shall continue.  

We make it clear that we have not gone into the merit of the matter and all

the contentions of the parties shall remain open.  

We,  however,  in  exercise  of  our  jurisdiction  under  Article  142  of  the

Constitution  of  India,  direct  that  the  Calcutta  Municipal  Corporation  shall

appropriate any amount, whether received from the landlord or from the tenant, in

respect of the property in question, towards the arrears of the property taxes dues.   

The appeal is disposed of accordingly.

S.L.P.(C) No. 4893/2007:

Although a limited notice was issued by us in terms of order dated 26.3.2007,

having heard Mr. Mukherjee, learned counsel appearing on behalf of the appellant

and Mr. Vishwanathan, learned counsel appearing on behalf of the respondents, we

are of the opinion that leave should be granted in respect of all the questions raised by

the appellant herein.

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Leave granted.

This  appeal  is  directed against  the  judgment and order dated 15.11.2006

passed by a Division Bench of the Calcutta High Court in A.P.O.T. No. 462/2006 in

G.A.No. 2793/2006 whereby and whereunder the appeal preferred by the respondents

herein was disposed of inter alia directing:

“Considering the facts and circumstances of the case, Smt. Basanti  Dutta,  a  learned  Advocate  of  this  Court  is  appointed Receiver. She shall  hold an enquiry as to who are the tenants and what is the rent actually paid by them. She shall diligently collect the arrear dues from the tenant, if any, and shall also collect the monthly rent  and  shall  deposit  the  same  with  the  Kolkata  Municipal Corporation towards the arrear rates and taxes.  It is clarified that the defendants shall go on paying the current dues in addition to the aforesaid deposit in pursuance of the order passed by Sen, J by the order dated 24th August, 2005.

For the time being, the prayer of the plaintiff  to appoint Receiver in respect of the two properties belonging to the defendant is rejected. It will be open to the plaintiff to apply afresh after a year depending upon the outcome of the exercise directed by this order. It is clarified that the Receiver shall be in possession of the property and no change of tenancy shall take place without the leave of the Court.   

The Receiver shall be entitled to a monthly remuneration of 120 G.M. The receiver shall also be entitled to appoint a clerk of her choice at such reasonable remuneration which she thinks proper. It will also be open to the Receiver to open a Bank Account with the State Bank of India, Main Branch. The Receiver shall be entitled to draw her remuneration including that of the clerk and the costs any from out of the rental income.   

In  the  event  the  defendant  are  occupying  any  part  or portion of the building in question, they shall contribute at the rate of Rs. 6 per sq. ft.

Let the money, to be deposited by the Receiver, be adjusted by the Kolkata Municipal Corporation towards the principal first.

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This  will  not  prevent  the  parties  to  the suit  from challenging the assessment made by the Corporation before the appropriate forum.”

(Emphasis supplied)

The basic fact of the matter is not in dispute.   

Respondent No.1 herein is a Mutwalli in respect of Pahchi Bibi Wakf Estate.

He applied for and was granted permission for a long term lease of a vacant plot of

land being situated at 54/1, Rafi Ahmed Kidwai Road. Pursuance to or in furtherance

of  the directions issued by the High Court in this behalf, admittedly, a lease deed was

executed by and between the said Mutwalli  and the appellant  herein  on or  about

5.4.1967. In terms of  the  said  deed of  lease,  the appellant built  up a five-storeyed

building  (superstructure)  covering  an  area  of  55,000  sq.  ft.  It  let  out  the  said

superstructure, inter alia, to Income Tax Department and the State Bank of India.  

The predecessors-in-interest of respondent  Nos.1 to 3 filed a suit  in 1997,

inter alia,  for a decree for a sum of Rs. 3.50 crores in respect of the arrears of rates

and taxes to be paid by the appellant herein to the Municipal Corporation as also for

grant of a decree for recovery of peaceful and vacant possession of the said premises

by evicting defendant No.1 and/or tenants therefrom.   

In the said suit, a prayer was also made for appointment of a receiver for

collecting the municipal dues from the tenants of the suit premises and for payment of

the arrears of taxes dues to the Calcutta Municipal Corporation.

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Indisputably, by reason of an order dated 24.8.2005, a learned Single Judge

of the Calcutta High Court, while declining the prayer of the plaintiffs-respondents

for appointment of the receiver, directed:

“The respondent  No.1 is  directed to pay  the  current  dues  of  the KMC Act  in  accordance  with  the  bills  raised  by  the  KMC. The amount, which is being paid in terms of the direction of the Writ Court, is to be adjusted towards arrears. The payments to be made in  terms  of  this  order  are  without  prejudice  to  the  right  and contention of the parties both in suit as well as in the pending writ application. In the event, it is ultimately held that the demand raised by the KMC is not correct, then the respondent No.1 shall be given due adjustment in respect of any excess payment made, after taking into account all payments made as on that date. The excess amount so computed shall  be reimbursed by the KMC to the  respondent No.1 and will not be adjusted towards future rates and taxes to be paid in respect of the suit property.”  

Indisputably,  the  said  order  was  not  appealed  against.  The  plaintiffs-

respondents, however, filed an application for appointment of a receiver in respect of

two  other  properties  owned  and  possessed  by  the  appellant  herein,  namely,  the

properties  situate  at  4B,  Chowringhee  Place,  Kolkata,  and  39,  Bentinck  Street,

Kolkata.   By reason of  the  judgment and order dated 18.7.2006,  a  learned Single

Judge of the Calcutta High Court while declining the said prayer, observed:

“I have heard Mr. Bachawat for the plaintiffs, Mr. Das Adhikary for the Municipal  Corporation and Mr. Banerjee. the respondent No. 1. It is true that the dues of the corporation are mounting up day by day. The properties which the plaintiffs want receiver to be appointed (illegible) (sic) the matter subject of the present suit. At the  same  time  protect  the  interest  of  the  parties  the  order  of injunction passed by me on May 3rd,  206 should continue till  the disposal of the suit.

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I  am told  that  the  respondent  No.1  has  already  filed  its  written statement. Mr. Das Adhikary prays for two (sic) time to file their written statement.  

The  written  statement  be  filed  by  the  corporation  within  two weeks  from  date;  cross-over  for  discovery  within  four  weeks thereafter,  inspection  forthwith,  liberty  is  given  to  the  parties  to mention for early hearing of the suit before the appropriate Bench.  

Till the suit is heard and disposed of, the interim order passed on May 3rd, 2006 would continue.”    

The plaintiffs-respondents preferred an appeal thereagainst.  By reason of

the impugned judgment a Division Bench of the Calcutta High Court, while refusing

to appoint  a receiver in respect of other properties belonging to the appellant, as

indicated hereinbefore, passed the impugned order as quoted hereinabove.  

Mr. Mukherjee, learned counsel appearing on behalf of the appellant would

submit  that  keeping  in  view the  fact  that  the  plaintiffs-respondents  in  the  second

application filed before the learned Single Judge of the High Court, did not make any

prayer for appointment of receiver in respect of the properties, the Division Bench of

the High Court must be held to have committed an illegality in passing the impugned

judgment. The learned counsel, in this connection, has also drawn our attention to

Grounds D & I of the special leave petition which read as under:               

“D. Because the High Court erred in the appeal in directing inter alia that the petitioner shall contribute @ Rs. 6 Per Sq. Ft. for any part or portion of the building being occupied by the petitioners. The said direction is beyond the pleadings and relief claimed in the suit filed by the respondents/plaintiffs being in contravention of the lease agreement between the petitioner and the respondent Nos.1, 2 and  3,  under  which  the  said  respondent  were  paid  a  sum  of

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Rs.2,30,000/- (Two lacs thirty thousand) and thereafter were to be paid a monthly lease rent of Rs.3,000/- for building upon the vacant land and using the same for 51 years.”

“I. Because High Court erred in directing the petitioner to pay rent to  the  Receiver  @  Rs.6/-  per  sq.  ft.  for  any  portion  of  the  said building being occupied by them as the same was beyond the clauses of the lease Deed inasmuch as the petitioners are the lessee of the said building and are paying the lease rent @ Rs.3,000/- per month as per the Deed of Lease.”

Mr. Vishwanathan, learned counsel appearing on behalf of the respondents,

however, has drawn our attention to the following averments made in the counter

affidavit:

“In  view of  the  said  appointment  the  Advocate  of  State  Bank  of India having their office at the said premises have stated that on or about May 20, 2004 the petitioner had taken a loan for a sum of Rs. 12 lacs against the rent receivable from the said State Bank of India. The said monthly rent of Rs. 42,201/- was converted to EMI against the rent taken by the petitioner. The petitioner has stated in their affidavit in opposition that as on September 1, 2006 they have been receiving Rs. 42,201/- as rent from the State Bank of India. The said rent  being  converted  to  an  EMI  it  is  clear  therefrom  that  the petitioner could not have deposited the said rent of Rs. 42,201/- from the  State  Bank  of  India  as  stated  by  the  petitioner  in  the  said affidavit.”

“The petitioner is also required to be directed to make payment of the said dues of the corporation in accordance with the order dated August  24,  2005  which  has  not  been  appealed  against  by  the petitioner  and  which  is  binding  on  them.  The  total  dues  of  the petitioner  which  they are  liable  to  pay  to  the  respondent  No.4  is more than Rs.4 crores and it is necessary that such direction be given by  the  petitioner  to  make  full  payment  thereof  in  view  of  the violation committed and the mis-conduct of the petitioner as stated therein  before.  The  said  payments  are  also  to  be  given  due adjustments in  accordance  with the order passed in the said writ jurisdiction  and/or  proceedings  arising  therefrom as  stated in  the said order of August 24, 2005. The petitioner also occupies an  area of more or less 500 Sq. Ft. on Ground Floor for which they are liable

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to make payment of rates and taxes as an occupier in accordance with the said terms and conditions of the lease deed. The petitioner's quarterly  rates  and  taxes  imposed  on  the  said  building  is Rs.5,34,693/- and the rent collected is approximately Rs.3,59,199/-. The whole of the rent collected has been directed to be deposited as rates and taxes by the Hon'ble High Court at Calcutta to liquidate the said dues outstanding in respect of the said premises. The said rent  when  calculated  to  per  square  feet  per  month  comes  to approximately  Rs.6.53  sq.  ft.  which  has  been  rounded  off by  the Hon'ble Judge in the said impugned order to Rs.6 per sq. ft. and has directed the petitioner to make such payment per sq. ft. for the area occupied by them if any in view of their admission that the said rent so collected has been deposited as rates and taxes to the respondent No.4.”

Mr. Vishwanathan on a query made by us, however, very fairly stated before

us that the said contentions are raised before us for the first time.  We, therefore, are

of the opinion that we should not deal with the said issues in this appeal.  

Indisputably,  the  prayer  for  appointment  of  receiver  for  the  purpose  of

collection of  rent  from the tenants  inducted in the premises  in  question had been

refused by the learned Single Judge of the High Court. As the said order has not been

appealed against, the same attained finality. It is, furthermore, not in dispute that the

other directions issued by the learned Single Judge, including the order of injunction,

are  being  complied  with.  In  fact,  a  statement  has  been  made  before  us  by  Mr.

Mukherjee, learned counsel appearing on behalf of the appellant, that out of a sum of

Rs. 4,03,98,731/- as demanded by the Calcutta Municipal Corporation up to March

2007, a sum of  Rs.3,92,62,600.88 has   already been paid.  We have,  however,  been

informed that another bill has been issued by the Calcutta Municipal Corporation on

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15.9.2008, showing the arrears of taxes as Rs.4,88,62,920/-. The said sum includes the

amount of interest and penalty.  

However, in view of the fact that the plaintiffs-respondents in their second

application for appointment of receiver did not reiterate the prayer made in the first

application, namely, that a receiver be appointed in respect of the suit premises in

question, we fail to understand as to how the Division Bench of the High Court could

issue the impugned direction.  

Before the learned Single Judge, the prayer of the plaintiffs-respondents is

confined to the appointment of a receiver in respect of the two properties which were

not  the  subject  matter  of  the  suit  and  the  said  prayer  having  been  rejected,  the

Division  Bench  of  the  High  Court  should  have  considered  as  to  whether  any

interference therewith was warranted or not.  

We have noticed hereinbefore that the Division Bench has also rejected the

said prayer. In that view of the matter, the Division Bench of the High Court, in our

opinion,  could  not  have  gone  beyond  the  pleadings  of  the  parties  and  directed

appointment of a receiver for the purposes mentioned heretobefore. The said order,

therefore, being wholly unsustainable is set aside.   

We  would,  however,  direct  that  the  interim order  passed  by  the  learned

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Single Judge shall continue. The receiver is discharged. Any report submitted by the

receiver  before  the  learned  Single  Judge  shall,  however,  be  kept  on  record.  Any

amount  realised  by  the  receiver  and  deposited  with  the  Calcutta  Municipal

Corporation shall be adjusted towards the arrears of taxes.   

Appellant shall continue to deposit the amount of rates and taxes in the office

of the Calcutta Municipal Corporation.  

The remuneration appropriated by the receiver from the amount of rent in

terms of the order passed by the Division Bench, however, need not be refunded.  

The appeal is allowed with the aforementioned direction/observation.  

The parties may file application or applications as they may deem fit and

proper.

We,  furthermore,  make  it  clear  that  the  order  passed  in  the  connected

appeal, i.e. appeal arising out of SLP(C) No. 6161/2007, shall be deemed to have been

passed in this appeal also.  

..........................J

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(S.B. SINHA)

..........................J   (CYRIAC JOSEPH)    NEW DELHI, OCTOBER 13, 2008.