IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 6190  OF 2008 (Arising out of S.L.P.(C) No.17110/2007)

Hindustan Petroleum Corporation Ltd. ...Appellant(s)

Versus

Rajkumari Padma Kumari & Anr. ...Respondent(s)

O R D E R

Leave granted.

An  application  under  Section  29-A(5)  of  the  U.P.  Urban  Buildings

(Regulation of Letting, Rent and Eviction) Act, 1972 was filed by the predecessor of

the respondents herein praying for determination of standard rent of the property in

question.   On  that  application,  Case  No.10/1999  was  registered  in  the  Court  of

District  Magistrate,  Dehradun.   In  the  said  application,  it  was  stated  that  by  a

registered deed dated 11th January, 1971, a piece of land situate at Gandhi Road,

Dehradun stood let out to Esso Eastern Inc.  Under the said deed, the tenant had a

right  to install,  erect and maintain underground tanks,  delivery pumps connected

thereto  and  building  to  be  constructed  for  the  purposes  of  storing,  selling  or

otherwise carrying on trade petrol  or petroleum products.   The lease was for ten

years from 15th March, 1970 at a monthly rent of Rs.450/-.   

Esso  Eastern  Inc.  stood  acquired  by  Government  of  India  under  the

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provisions of Esso (Acquisition of Undertaking in India) Act, 1974.  Consequently,

Hindustan Petroleum Corporation Ltd. (HPCL), the appellant before us, came into

picture in the said proceedings.  HPCL thereafter filed its written statement in which,

inter alia,  it was  contended that in the lease,  there was a term for renewal for a

further period of ten years at the option of the lessee, that during the said term of the

lease, M/s. Esso Eastern Inc. stood acquired under the 1974 Act and, consequently,

the lease stood transferred to HPCL.  It was pleaded that consequent to the passing of

the 1974 Act, under Section 5(2) of the said Act, such lease was to be renewed on the

same terms and conditions  on which the lease or tenancy was held by Esso Eastern

Inc.  According to HPCL, before expiry of the total term of twenty years, the lessee

had availed of its statutory right for renewal of lease for a further term beyond 14th

March, 1990 on the same terms and conditions as mentioned in the lease agreement.

To complete the chronology of events, the District Magistrate, Dehradun, in

the above proceedings called for the valuation report of the Tehsildar.  The report

was given on 27th December, 2002 stating that the value of the property on the basis of

circle  rate as  well  as on the basis  of  market value should  be fixed at the rate of

Rs.50,000/- per month.  The District Magistrate has assessed and fixed the standard

rent at the rate of Rs.50,000/- per month.  This rate has been confirmed by the High

Court vide its impugned judgment.  Hence, this Civil Appeal by HPCL.

Two  points  arise  for  determination  in  this  case.   Firstly,  the  date  from

which the rent of Rs.50,000/- per month should be made applicable to the premises in

question and, secondly, whether the High Court was right in confirming the standard

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rent fixed by the District Magistrate at the rate of Rs.50,000/- per month.

In the course of hearing, an argument was advanced on the first point by

the learned counsel for HPCL that HPCL had exercised its option for renewal of

lease for a further period of ten years commencing from 15th March, 1990 on the same

terms and conditions on which it held the lease before 15th March, 1990.  There is

merit in this contention.   We find from the correspondence annexed to the paper

book at page 227 onwards and, particularly, in the context of the letter dated 15th

May, 1990 at page 234, that the appellant herein had exercised its statutory right for

renewal of the above lease upto 14th March, 2000 under Sections 5 and 7(3) of the

1974  Acquisition  Act.   Therefore,  on  the  first  point,  we  hold   that  the  District

Magistrate had erred in determining the standard rent from 15th March, 1990 at the

rate  of  Rs.50,000/-  per  month  because  the  period  from 15th March,  1990  to  14th

March, 2000 came within the statutory right of the appellant under the 1974 Act.

However, we do not find fault in the Order of the  District Magistrate as HPCL did

not  produce the correspondence  which  is  now placed on record before  us  by the

landlord.   

On the second point, we find that HPCL did not lead any evidence in the

form of  valuation  report  challenging  the  rate  of  standard  rent  proposed  by  the

Tehsildar in its report to the District Magistrate.  After the expiry of the contractual

lease  and particularly from the  period 15th   March,  2000,  HPCL claims to  be  a

statutory tenant under the U.P. Urban Buildings (Regulation of Letting, Rent and

Eviction) Act, 1972.  Under Section 9(2), the District Magistrate is required to fix the

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standard  rent  in  accordance with  certain  parameters  indicated  and  provided  for

therein.  One of the parameters refers to prevailing rents for similar buildings in the

locality.  No evidence has been led by the HPCL in this regard.  For the aforestated

reasons,  on  the  second  question  regarding  fixation  of  standard  rent  fixed  at

Rs.50,000/- per month, we see no infirmity in the impugned judgment of the High

Court  and  the  District  Magistrate.   Consequently,  we  hereby  declare  that  the

respondent-lessor would be entitled to charge, levy and recover standard rent at the

rate of Rs.50,000/- per months with effect from 15th March, 2000 and not from 15th

March, 1990, as  directed by the District  Magistrate.   The question  as to  whether

HPCL is protected under the 1972 Act or not does not arise for consideration in this

Civil Appeal.

We are informed that an  eviction suit  is  also  filed  by the tenant  herein

under the Transfer of Property Act, which is pending before the trial  court.  We

express no opinion regarding that suit.  All contentions available to the parties in that

suit are expressly kept open.  Any observation made in the present order regarding

claim to protection under the Rent Act will not bind the trial court in that suit.

Accordingly, Civil Appeal stands partly allowed, with no order as to costs.

                         ...................J.               (S.H. KAPADIA)

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

                                       (B. SUDERSHAN REDDY) New Delhi, October 22, 2008.

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