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2008 DIGILAW 1231 (PNJ)

Khanna Improvement Trust v. Income Tax Department

2008-07-15

AUGUSTINE GEORGE MASIH, SATISH KUMAR MITTAL

body2008
Judgment Augustine George Masih, J. 1. Khanna Improvement Trust, Khanna has challenged order dated 9.1.2007 (P-9) passed by the Sub Divisional Magistrate, Payal (respondent No. 3) whereby the application for ejectment of Income Tax Department (Respondent No. 1) under Sections 4, 5 and 7 of the Punjab Public Premises and Land (Eviction and Rent Recovery) Act, 1973 has been referred to the Arbitrator and the order dated 15.2.2008 (Annexure P-11) passed by the Deputy Commissioner, Ludhiana (respondent No. 2) in appeal wherein order dated 9.1.2007 has been upheld. 2. The submission of the counsel for the petitioner is that the lease between the parties, which is dated 23.1.1992 (Annexure P-1) was for a period of five years and the said period expired on 22.01.1997. The said agreement no more being in operation. Clause 15 of the said agreement could not be involved to refer the matter to the Arbitrator. Since the said lease is not more in operation, the orders impugned i.e. 9.1.2007 and 15.2.2008 deserve to be set aside and petition under Sections 4, 5 and 7 of the Punjab Public Premises and Rent Recovery Act, 1973 deserves to be remanded back for decision on merits under the said Act. 3. We have gone through the pleadings. It is clear from there that apart from the ground that the lease period stands expired, there are other disputes also which relate to payment of dues and damages on account of use and occupation of the premises and on account of house tax of public premises. It would not be out of place to mention here that the above mentioned lease agreement dated 23.1.1992 (Annexure P-1) contains clause 12, which provides for extension of the lease period. It is stated in para 5 of the Application of the respondent No. 1 dated 1.12.2006 (Annexure P-7) to the Collector, Payal, for reference of the matter to Arbitrator that the respondent No. 1 had clearly communicated its option to continue the possession of the building vide registered letter dated 4.5.1998 in response to the letter of the petitioner dated 24.3.1998. Clause 15 of the agreement provides for the reference of any dispute arising out of the lease to an Arbitrator to be appointed by the Government of India. Clause 15 of the said lease deed reads as under: 15. Clause 15 of the agreement provides for the reference of any dispute arising out of the lease to an Arbitrator to be appointed by the Government of India. Clause 15 of the said lease deed reads as under: 15. Should any dispute or difference arise our concerning the subject matter of these presents or any convenient clause of this herein contained or otherwise arising out of this lease, the same shall be referred to an arbitrator to be appointed by the Government of India and the decision of such Arbitrator shall be conclusive and binding on the parties hereto. The provision of the Arbitration Act, 1940, or any statutory modifications thereof for the time being in force shall apply to such arbitration the Government of India will bear the expenses of Stamps and Registration Charges if any. 4. A perusal of the above clause 15 makes it clear that the above stated disputes, which arise from the leave agreement are referable to the Arbitrator as per the lease agreement. The Collector, Payal, District Ludhiana, vide his order dated 9.1.2007 has only allowed the application moved by the Income Tax Department to send the case for disposal to the Arbitrator as per clause 15 of the lease agreement. This order has been upheld by the Commissioner, Ludhiana vide order dated 15.2.2008 (Annexure P-11). 5. The impugned orders being in accordance with the lease agreement dated 23.01.1992 (Annexure P-1) the same are upheld. It would not be out of place to mention here that the Honble Supreme Court in Oil and Natural Gas Commission and Anr. v. Collector of Central Excise 1995 Supp.(4) Supreme Court Cases 541 has, while deciding the dispute between the ONGC and Collector of Central Excise, observed that in case of any dispute inter se departments of the Government or public undertakings, it is necessary that the matter be resolved amicably by mutual consultation or through the good offices of empowered agencies of the Government or through arbitration and recourse to litigation should be eliminated. This is to ensure that no litigation comes to Court or to a Tribunal without the matter having been first examined in the manners suggested above. The purpose of such observations is to reduce the burden of the Court and inter se departmental disputes are amicably resolved and only when such disputes persists, should the matter come to the Court. This is to ensure that no litigation comes to Court or to a Tribunal without the matter having been first examined in the manners suggested above. The purpose of such observations is to reduce the burden of the Court and inter se departmental disputes are amicably resolved and only when such disputes persists, should the matter come to the Court. This is in the larger public interest and in this case where a specific clause for arbitration stands incorporated in the agreement itself, resort to arbitration is preferable. 6. In the light of the above, writ petition filed by Khanna Improvement Trust, Khanna is dismissed. It would be open to the petitioner just to take all objections before the Arbitrator. 7. There shall be no order as to costs.