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1985 DIGILAW 27 (DEL)

UNION OF INDIA v. WEARWELL CYCLE COMPANY (INDIA) LIMITED

1985-01-15

B.N.KIRPAL, PRAKASH NARAIN

body1985
B. N. KIRPAL ( 1 ) THIS is a Letters Patent appeal against the judgment of Rajinder Sachar, J. who had issued a mandamus directing the appallant herein to transfer property No. 30, New Industrial Township, Faridabad, in favour of respondent No. 1. ( 2 ) FOR the view which we are taking, it is not necessary to refer to the facts in any great detail. The same have already been dealt with by the learned single Judge. It is, however, necessary to note that on April 28, 1954 the appellant issued a Press Note to the effect that it proposed to allot property No. 30, New Industrial Township, Faridabad. On April 1, 1956 respondent No. 1 had applied and obtained a lease for a period of five years on an annual rent of Rs. 23,050. 00. On June 22, 1961 the appellant gave an offer to respondent No. 1 to purchase the said property. The acceptance was required to be communicated within a month. This, however, was not done. ( 3 ) IT appears that eviction proceedings were initiated against respondent No. 1 under the provisions of the Public Premises (Eviction of Unauthorised Occupants) Act, 1958. On Dec. 28, 1965 an order of eviction was passed on the ground that respondent No. 1 had not paid the lease money. The said respondent then made an offer to pay the rent along with interest if the eviction order was withdrawn. On March 4, 1968 the appellant agreed to withdraw the eviction order if the said respondent agreed to execute a fresh lease at an enhanced rent of Rs. 30,620. 00 per annum. This offer was accepted by the respondent but it requested that the rent be reduced and the interest be charged at the rate of 5 per cent instead of 6 per cent, which was claimed. ( 4 ) THE said respondent had filed an appeal against the order of eviction which had been passed under the Public Premises (Eviction of Unauthorised Occupants) Act. On June 22, 1968 this appeal was allowed on the ground that the said Act had been declared ultra vires. The respondent informed the appellant about the acceptance of the appeal and again offered to purchase the said property. By letter dated June 23,1969 the offer to purchase was accepted at a total cost of Rs. 4,71,000. 00. On June 22, 1968 this appeal was allowed on the ground that the said Act had been declared ultra vires. The respondent informed the appellant about the acceptance of the appeal and again offered to purchase the said property. By letter dated June 23,1969 the offer to purchase was accepted at a total cost of Rs. 4,71,000. 00. The said respondent was also required to pay the arrears of rent in monthly instalments of Rs. 2500. 00. The cost of the property was to be paid in 10 annual instalments, the first instalment was required to be paid within 30 days of the offer. Interest was required to be paid at the rate of 9 per cent. It is contended by the appellant that the offer of June 23,1969 was not accepted in toto by the respondent- company. By its letter dt. July 7, 1969 it communicated a conditional acceptance. The said company wanted an extension of time for making payment of the first instalment which was granted up to Oct. 7,1969. Thereafter an extension was again granted up to Dec. 31, 1969. It appears that thereafter the respondent- company wrote to the appellant asking for a rebate of Rs. 70,712. 25 on account of upkeep and repairs of the factory premises. ( 5 ) THE two crucial documents in the case are the letters dt. Dec. 28,1970, written by the appellant, and the reply received thereto. By its letter dt. Dec. 28,1970, issued on behalf of the Settlement Commissioner, the said respondent was informed that it was not possible to give rebate for non-repairs of the building. A fresh offer was made to the respondent to pay the arrears of rent up to Dec. 31, 1970 amounting to Rs. 1,20,165. 67 together with further rent up to the payment of the entire cost of the first instalment of the cost of land and the instalments of arrears were to be paid, as laid down in the earlier letter dated June 23, 1969. The said company was also asked to pay the entire cost of the factory and building which had earlier been asked for. The payment was required to be paid within one month of the date of issue of the said letter, failing which the offer of sale was to be treated as withdrawn. It appears that the respondent wrote of rebate made therein. The payment was required to be paid within one month of the date of issue of the said letter, failing which the offer of sale was to be treated as withdrawn. It appears that the respondent wrote of rebate made therein. The said letter, however, is not on the record. The respondent thereafter on Jan. 12, 1971, which was a second important letter, again wrote to the Chief Settlement Commissioner inter alia, stating that they unequivocally accepted the offer of the appellant and they agreed to pay the entire amount irrepective of the appellant s decision with regard to the rebate to be allowed. The respondent asked the appellant to name the authority in whose favour the draft/pay order/cheque was to be issued. It was not denied that this information was not supplied with the result that payment could not be made by the respondent-company. One other fact, which may be mentioned at this stage, is that it appears that the municipal authorities of Faridabad had filed a writ petition and had obtained a stay of the sale of land. Possibly, for this reason the information asked for was not supplied by the appellant because the appellant was at that time not in a position to transfer the land in question. The said petition was dismissed and the stay vacated on Sept. 22,1972. ( 6 ) THE respondent in the meantime filed Civil Writ No. 834, inter alia, praying for a writ of mandamus for directing the appellant herein to accept the sale price and execute the sale deed in its favour. The single Judge vide his judgment dt. Aug. 28, 1974 allowed the writ petition. Direction was issued to the appellant herein to transfer the property to the said respondent subject to the respondent paying a sum of Rs. 4,71,080. 00 along with arrears of rent and interest up-to-date. The appellant herein was required to communicate to the respondent the exact amount of arrears which were due and the respondent was given two months time to make the payment and it was made clear that if the payment was not made, the mandamus would become inoperative. While allowing the petition the learned single Judge came to the conclusion that the provisions of Art. 299 of the Constitution had been complied with and further the Court had the jurisdiction to entertain the petition under Art. 226 of the Constitution. While allowing the petition the learned single Judge came to the conclusion that the provisions of Art. 299 of the Constitution had been complied with and further the Court had the jurisdiction to entertain the petition under Art. 226 of the Constitution. ( 7 ) IN the appeal before us, the main contention which had been raised by Shri D. K. Kapur, learned counsel for the appellant, is that there was no right in favour of the respondent to claim the transfer of land. In this connection it was also submitted that the provisions of Art. 299 had not been complied with. It was further contended by Shri Kapur that, in any case, if there has been a breach of contract on the part of the appellant, the remedy of the respondent was by way of a suit and not by way of a writ petition. ( 8 ) IT is not in dispute that the property in question formed part of the compensation pool. The property was ordered to be transferred and this power could only have been exercised under S. 20 of the Displaced Persons (Compensation and Rehabilitation) Act, read with Rule 87 of the Rules framed thereunder. The decision for the transfer of property has to be taken by the authorities under the said Act. That decision need not be in the name of the President of India. It is only when the instrument of transfer is executed that the same has to be in the name of the President. This was not a case of an ordinary contract. This was a case of the appellant exercising its powers under the provisions of the "displaced Persons (Compensation and Rehabilitation) Act. The statutory power, which is exercised by it, need not necessarily be in the name of the President. However, in the present case the letter dt. June 23, 1969 clearly stated that it was being issued for and on behalf of the President of India. All that happened by the letter of Dec. 28, 1970 was that the time for accepting the offer, already made by the letter dt. June 23, 1969 of the President of India, was extended but it was not necessary for the letter of Dec. 28,1970 to have been in the name of the President of India. ( 9 ) THE other contention of Shri Kapur is also devoid of all merits. June 23, 1969 of the President of India, was extended but it was not necessary for the letter of Dec. 28,1970 to have been in the name of the President of India. ( 9 ) THE other contention of Shri Kapur is also devoid of all merits. The appellant having taken a decision to transfer the property in favour of the respondent and having communicated the same to it could not, without any valid reason, resile therefrom. The premises were in the occupation of the respondent. They were told by the appellant that they were being transferred to the respondent. The decision to transfer the premises to the respondent was a valid one. If the appellant sought to resile therefrom, the said action would really be termed as arbitrary and violative of the provisions of Art. 14 of the Constitution. What the respondent was seeking is not the enforcement of a contractual right but the claim of the respondent was that the appellant should not act in an arbitrary manner. The direction, which was sought from the Court, was that the appellant should be compelled to act in accordance with law. In our opinion, the learned single Judge was fully justified in entertaining the writ petition and in issuing the mandamus. No other point has been urged before us. ( 10 ) FOR the aforesaid reasons, the appeal is dismissed with costs. ( 11 ) WE may mention that during the period of two months, which had been granted by the learned single Judge, the present appeal was filed. On Dec. 13, 1974 the operation of the order was suspended. With the passage of time it has, therefore, become necessary to issue fresh directions. We, accordingly, direct that the appellant will transfer to respondent No. 1 the aforesaid property subject to the said respondent paying a sum of Rs. 4,71,080. 00 alongwith with arrears of rent and interest up to date. The exact figure of the arrears of rent and interest calculated up to Feb. 28,1985 will be communicated by the appellant to the said respondent on or before that date. The respondent-company will pay the entire amount so demanded by May 31, 1985. In case respondent No. 1 fails to deposit the said amount, the mandamus issued will become inoperative. ( 12 ) RESPONDENT No. 1 had also filed cross- objections in this case. 28,1985 will be communicated by the appellant to the said respondent on or before that date. The respondent-company will pay the entire amount so demanded by May 31, 1985. In case respondent No. 1 fails to deposit the said amount, the mandamus issued will become inoperative. ( 12 ) RESPONDENT No. 1 had also filed cross- objections in this case. Shri Madan Bhatia, learned counsel for the respondents, fairly conceded that these cross-objections were not maintainable. They are, accordingly, dismissed.