Bhatpara Papers Pvt. Ltd. v. Board of Trustees for the Port of Kolkata
2015-12-23
ANIRUDDHA BOSE
body2015
DigiLaw.ai
JUDGMENT : ANIRUDDHA BOSE, J. 1. These two revisional applications arise out of two separate proceedings initiated originally against Titagarh Paper Mills Co. Ltd. T.P.M. by the Estate Officer, Kolkata Port Trust under the provisions of The Public Premises (Eviction of Unauthorised Occupants) Act, 1971 (the 1971 Act) seeking their eviction from two separate warehouses located on Strand Road, Kolkata. The properties involved carry the description of Compartment No. A/4 measuring 309.459 square meters and Compartment No. A-1 measuring 262.358 square meters respectively. Two separate notices under Section 4 of the 1971 Act had been issued on 28th August 1993, and the proceedings were numbered 175 and 176, both of 1993. These notices were issued mainly on the ground that TPM’s tenancy under the monthly term lease had been determined in the year 1985 upon issue of notice of ejectment and from the dates stipulated in the respective notices, TPM was in wrongful possession of the respective properties. I am not narrating detailed chronological sequence of events which took place at that point of time in this judgment, as what has been argued before me in these proceedings relate to certain legal issues, for which such detailed narration is not necessary. So far as the opposite parties are concerned, Mr. Saptangshu Basu, learned Senior Counsel agreed to disposal of these two petitions without filing any affidavit, as what was being argued before me related to pure questions of law. In respect of TPM, a scheme of arrangement was approved by the Company Judge of this Court by an order dated 1st February 2006, and by virtue of sanctioning of such scheme, the petitioners claim to have become entitled to exercise their rights in respect of the aforesaid warehouses, as also accept the obligations arising from the said properties. Admitted position is that during pendency of the proceedings under the 1971 Act, a fire had gutted both the properties on 13th February 2010. Learned counsel for the petitioner has submitted that subsequent to such fire, the petitioner had abandoned the property and possession thereof was taken over by the port authorities. The fact that the port authorities are in possession of the subject properties since then is not in dispute. 2.
Learned counsel for the petitioner has submitted that subsequent to such fire, the petitioner had abandoned the property and possession thereof was taken over by the port authorities. The fact that the port authorities are in possession of the subject properties since then is not in dispute. 2. These two applications are directed against a common order passed by the Estate Officer on 18th February 2014 under Section 7(2) of the 1971 Act, in two separate proceedings registered as 175D and 176D of 2012 directing the department to draw formal order under Section 7 of the 1971 for payment of damages in the following terms:- “NOW THEREFORE, in view of the discussion above, KoPT’s prayer for damages is allowed subject to correction/modification of KoPT’s claim on account of sub-letting fees as aforesaid. Department is directed to draw formal order U/S 7 of the Act as per Rule made under the Act for recovery of damages against O.P./A.P., giving time upto 31.03.2014 for payment of Rs.41,75,855/- (SW-51) in respect of proceedings No. 175/D of 2012 and Rs.43,68,839/- (SW-46/7 Rs.36,29,949/- plus Rs.7,38,944/- for SF-176) in respect of proceedings No. 176/D of 2011. It is worthy to point out that notice U/S 7 of the Act in respect of proceedings no. 175/D of 2012 was issued to O.P./A.P. with an additional amount of sub-letting fees in respect of SF-176. It is subsequently detected that sub-letting charge head is in respect of proceedings no. 176/D of 2012 and as such the sub-letting fees recoverable from O.P./A.P. has been adjusted against damages payable in respect of proceedings no. 176/D of 2012. This adjustment/modification and/or rectification does not entail any additional financial liability to O.P./A.P. or I should rather say this rectification has no financial implication or miscarriage of justice to anybody. Parties are directed to take note of the matter and department is directed to issue formal order U/S 7 of the Act accordingly. Such charges on account of damages attracts interest at the rate of 15% per annum up to 18.9.19996 and thereafter at the rate of 18% per annum up to 6.4.11 and thereafter at the rate of 14.25% per annum from 7.4.2011 till its final payment as per KoPT’s notified rates in accordance with the notification published under authority of law in terms of the provisions of the Major Port Trusts Act, 1960.
Needless to mention that any action taken by its Port Authority must abide by the decision of the Writ court or by any order passed by a competent court of law. All concerned are directed to act accordingly.” 3. In the two original proceedings under Section 4 of the 1971 Act, TPM had filed their written response. It appears from the order impugned that the proceedings were contested by the TPM seeking insulation from the rigours of the 1971 Act, primarily relying on a scheme of Board for Industrial and Financial Reconstruction (BIFR) as also on the ground of limitation. It is also recorded in the order, which is assailed in these two proceedings:- “It reveals from record that this Forum of Law by its order No. 12 dated 27.01.1999 came to the conclusion that there was no justification of seeking order of eviction against O.P. on the ground of Implementation of “Land Use Plan” of KoPT and in case of failure on the part of C.P. to pay the amounts and installments as stipulated in the said order. KoPT had every liberty to come up for further consideration of the matter. It was also made clear by the said order dated 27.01.1999 that the order regarding payment to KoPT shall remain in force for the period for which Rehabilitation Package of BIFR in force. It reveals from various orders passed by this Forum of Law that M/s. Titagarh Industries Ltd. (predecessor-in-interest of O.P.) time to time made payment of KoPT. During hearing on 03.03.2006 it is submitted on behalf of O.P. that certain concession has been given to O.P. by BIFR at the time of sanctioning scheme for Rehabilitation Package and in doing so, Notification in News Paper, inviting the attention the creditors of the Company/O.P. was published. It is argued that the Scheme was approved by the BIFR and the order for such for such approval of scheme was never challenged and as such, it has got an overriding effect. It is argued on behalf of KoPT that in any event the Rehabilitation Scheme as approved by BIFR has lost its force after statutory limit of time.
It is argued that the Scheme was approved by the BIFR and the order for such for such approval of scheme was never challenged and as such, it has got an overriding effect. It is argued on behalf of KoPT that in any event the Rehabilitation Scheme as approved by BIFR has lost its force after statutory limit of time. Thereafter, M/s. Bhatpara Papers Ltd. expressed its right as Successor-in-interest of O.P. in respect of the properties in question as per Hon’ble Calcutta High Court’s order dated 01.02.2006 regarding scheme of arrangement in question and filed its objection/petitions as Added Party (A.P.) to these proceedings. It transpires that A.P. made certain payments to KoPT which were accepted by the Port Authority without prejudice to the rights and contention both the parties and raised dispute regarding their liability towards payment of sub-letting fees. It is argued by KoPT that the original recorded tenant of KoPT applied for creation of sub-tenancy in favour of M/s. Commercial Products Ltd. being its subsidiary Company to store materials of others on temporary licence basis. Considered the order No. 46 dated 10.11.2006 in this respect.” 4. As regards the proceedings initiated under Section 4 of the Act are concerned, it is recorded in the impugned order:- “By order dated 14.06.2011, this Forum of Law came to the conclusion that there is no necessity of proceeding with the matter on the basis of Sec.4 notice issued to O.P. and only the claim on account of damages is required to be adjudicated against the respective holding Nos./Plate Nos. which were previously under occupation of O.P. In fact, the purpose for proceedings U/S 4 of the Act for recovery of possession from O.P. as earlier prayed for on behalf of KoPT. For adjudication of the KoPT’s prayer for realization of arrear charges for compensation equivalent to monthly charges for occupation into the Port Properties in question together with interest for delayed payment calculated upto 14.02.2011. It reveals that KoPT’s claim in respect of occupations previously held by O.P. are as follows. 1. SW-51 Rs.41,75,855.56 (Principal amount) 2. SW-46/7 Rs.36,29,949.00 (Principal amount) Sub-letting Fees: (connected with SW-46/7. Erroneously recorded as connected with SW-51. SF-176 Rs.18,11,019.00 (Principal amount)” 5.
It reveals that KoPT’s claim in respect of occupations previously held by O.P. are as follows. 1. SW-51 Rs.41,75,855.56 (Principal amount) 2. SW-46/7 Rs.36,29,949.00 (Principal amount) Sub-letting Fees: (connected with SW-46/7. Erroneously recorded as connected with SW-51. SF-176 Rs.18,11,019.00 (Principal amount)” 5. The present petitioner, Bhatpara Papers Limited, were added as a party to the aforesaid two proceedings as they had acquired right overt the aforesaid properties on the strength of the scheme of arrangement of demerger approved by the Company Judge of this Court. The petitioner had agreed to clear up the dues and charges payable by the Titagrah Paper Mills (TPM) Limited under the revival package formulated by the BIFR. No material is there before this Court revealing what transpired in the two proceedings before this Court revealing what transpired before the Estate Officer between the dates of issue of the notices under Section 4 of the 1971 Act in the year 1993 and subsequent issue of the notices under Section 7(2) and (3) of the same Act on 6th November 2012. From the impugned order of the Estate Officer, however, there is reference to several objections and written statements filed on 21st January 1999, 16th March 1999, 12th July 1999, 14th September 1999, 27th October 1999, 24th May 2006, 30th June 2006, 10th January 2007, 28th February 2007, 9th April 2008. There is also reference to Order No. 12 dated 27th January 1999, 3rd May 2011 and 14th June 2011, as also to the order dated 2nd July 2012 in the two show cause notices. 6. Complaint of the port authorities, which has been recorded in the impugned order, is that in spite of being requested by the Port Authorities, no comprehensive report regarding amount payable to the Port Trust was filed by the petitioner. Thereafter by the order dated 2nd July, 2012 the Estate Officer came to the conclusion that occupation of the petitioner or anyone claiming right through the petitioner had become unauthorized upon service of notice for revocation of license dated 18th February 1985 and 23rd February 1985 in respect of the two properties. The notice on 6th November 2012 were issued under Section 7(2) and (3) of the 1971 Act addressed to both TPM and the petitioner which were numbered 175-D and 176-D requiring them to show cause in that regard.
The notice on 6th November 2012 were issued under Section 7(2) and (3) of the 1971 Act addressed to both TPM and the petitioner which were numbered 175-D and 176-D requiring them to show cause in that regard. It is recorded in the impugned order of 18th February 2014 that on 7th January 2013 the petitioner filed petitions before the Estate Officer praying for, inter alia, recalling the order No.93 dated 2nd July 2012 regarding issuance of Show Cause Notices under Section 7(3) of the Act. It was by this order the Estate Officer had found occupation of the petitioner to be unauthorized in respect of the public premises for the uptil 14th February 2010. I find from the impugned order that Port Trust filed objection to such plea and there were also rejoinders and additional written statements filed by the petitioner. 7. The Estate Officer formulated eight questions for adjudication upon exchange of rejoinder and written statements. These are:- “1. Whether this Forum of Law has jurisdiction to entertain the matter regarding recovery of damages as prayed on behalf of KoPT in respect of proceedings Nos. 175/D of 2012 and 176/D of 20012 or not. 2. Whether the Show Cause Notice/s U/S 7 of the act should be rejected on the ground that the notice was made a part of the eviction proceedings No. 176 of 1993 and the proceedings was renumbered as 176/D of 2012 AND a part of eviction proceedings No. 175 of 1993 being renumbered as 175/D of 2012 or not. 3. Whether after taking over of possession of the Public Premises by KoPT (consequent upon demolition of the Warehouse/Premises in question), there can be any subsisting right of KoPT for recovery of damages etc. from O.P./A.P. or not. 4. Whether BIFR proceedings or rehabilitation package as granted by BIFR has any merit in deciding any question before this Forum of Law at this stage or not. 5. Whether KoPT’s claim against O.P./A.P. is barred by limitation with withdrawal of proceedings for eviction on the basis of the Show Cause Notice U/S 4 of the Act or not. 6. Whether Limitation Act is applicable to the proceedings before the Estate Officer, the Adjudicating Authority under the Public Premises (Eviction of Unauthorised Occupants) act, 1971 or not. 7.
5. Whether KoPT’s claim against O.P./A.P. is barred by limitation with withdrawal of proceedings for eviction on the basis of the Show Cause Notice U/S 4 of the Act or not. 6. Whether Limitation Act is applicable to the proceedings before the Estate Officer, the Adjudicating Authority under the Public Premises (Eviction of Unauthorised Occupants) act, 1971 or not. 7. Whether the plea taken by A.P. with reference to AIR 1973 PAT 289 , AIR 1955 MAD 527 and AIR 1947 MAD 109 is at all relevant for the purpose of deciding any question before this Forum of Law which is not a Civil Court or not. 8. Whether A.P. is liable to pay damages for wrongful use and enjoyment of the property upto 14.02.2010 in respect of proceedings Nos. 176/D of 2012 and 175/D of 2012 or not.” 8. Upon considering submissions of the respective parties, the directive for drawing formal order for recovery of damages under Section 7 of the 1971 Act was made, to which I have referred to earlier in this judgment. In these two proceedings the petitioner has, inter alia, challenged the legality of the common order by which the two applications of the petitioner were disposed of by the Estate Officer. 9. Mr. Basu has questioned maintainability of these two petitions on the ground that there is provision for appeal against the order of the Estate Officer under Section 9 of the 1971 Act before the District Judge of the District in which the public premises are situated, and the power of superintendence of this Court under Article 227 ought not be invoked, there being efficacious alternative remedy. Pressing for dismissal of these petitions on the ground of there being efficacious alternative remedy, he has relied on six decisions, being the cases of:- (i) Maneck Custodji Vs. Sarafazali ( AIR 1976 SC 2414 ) (ii) K.K. Srivastava Vs. Bhupendra Kumar Jain & Ors. ( AIR 1977 SC 1703 ) (iii) Calcutta Electricity Supply Corpn. Ltd. Vs. Kalavanti Dosh Trust [ (2011)1 CHN 182 ] (iv) W.B.S.E.B. & Ors. Vs. Anup Mondal & Ors. [ (2006)2 CHN 12 ] (v) Nilmoni Mukherjee & Ors. Vs. Ashim Kumar Chattopadhyay & Anr. (2008 Vol. I CLJ page 892) (vi) The Manager, Burdwan Cooperative Agriculture and Rural Development Bank Ltd. Vs. Anath Bandhu Dhara [(2009) 2 CLJ page 685] 10. Mr.
Vs. Anup Mondal & Ors. [ (2006)2 CHN 12 ] (v) Nilmoni Mukherjee & Ors. Vs. Ashim Kumar Chattopadhyay & Anr. (2008 Vol. I CLJ page 892) (vi) The Manager, Burdwan Cooperative Agriculture and Rural Development Bank Ltd. Vs. Anath Bandhu Dhara [(2009) 2 CLJ page 685] 10. Mr. Abhrajit Mitra, learned Senior Counsel appearing for the petitioner, on the other hand has argued that availability of alternative remedy is not an absolute bar on maintaining an application under Article 226 or 227 of the Constitution of India. To sustain his argument on this point, he has submitted that there was breach of principles of natural justice by the Estate Officer in that while dealing with the petitioner’s application for dismissal of the notices, the Estate Officer had decided the entire issue on payment of damages. He has also claimed that there was error on face of the record so far as the impugned order is concerned as the claim for damages, as submitted by him, was time barred. On the question of maintainability of the petition, he relied on a decision of a Coordinate Bench of this Court in the case of Automobile Association of Eastern India & Ors. Vs. The Board of Trustees of the Port of Kolkata & Ors. [(2010)4 Cal LT 591 (HC)]. In this case also, the question of time barred claim under Section 7 of the 1971 Act as well as the question of invoking the jurisdiction of this Court under Article 226 of the Constitution of India was involved, where the petitioner did not avail of the statutory remedy of appeal. On the latter point it was held:- “There are, however, well-recognized exceptions to the rule of alternative remedy as enunciated by judicial precedents. The Supreme Court has consistently held that alternative remedy would not operate as a bar in case of violation of principles of natural justice, where the order or proceedings are without jurisdiction, where the writ petition has been filed for enforcement of a fundamental right or where the vires of any statute and/or statutory rule is under challenge. The existence of an alternative remedy is not an absolute bar to entertaining a writ application, as rightly argued by Mr. Kundu. This proposition finds support from the judgments cited by Mr. Sanyal referred to above.
The existence of an alternative remedy is not an absolute bar to entertaining a writ application, as rightly argued by Mr. Kundu. This proposition finds support from the judgments cited by Mr. Sanyal referred to above. In exceptional cases, writ petitions might be entertained, notwithstanding the existence of an alternative remedy, and specially when the order impugned is found to be violative of principles of natural justice and/or without jurisdiction. In any case, once a writ application is entertained and affidavits invited, the writ application is not rejected on the sole ground of existence of alternative remedy. It is true, that when the writ petition was initially moved, this Court kept the question of alternative remedy open. However, the writ application could not be taken up for hearing for almost two years. The issue is whether the writ application should be thrown out on the sole ground of alternative remedy, just because leave had been given to the respondent authorities to agitate the issue of alternative remedy after the filing of affidavits.” In these two petitions, questions of breach of principles of natural justice as also ex facie violation of the provisions of law is involved. On the aspect of non-adherence to the principles of natural justice, argument of the petitioner is that the only point on which the petitioner sought dismissal of the impugned notices is the claim being time-barred, but the Estate Officer had disposed of the entire matter holding the petitioner liable to pay damages. I have heard the parties at length on this point. In the case Maneck Custodji Vs. Sarafazali, the Supreme Court had accepted the proposition of law that the powers and jurisdiction of the High Court under Article 227 of the Constitution of India could be invoked to challenge the validity of an order even if there was provision for appeal against that order. The Supreme Court in that case, however, was pleased to set aside the order passed by the High Court invoking such jurisdiction. In the case of K.K. Srivastava Vs. B.K. Jain ( AIR 1977 SC 1703 ) also, the Supreme Court, dealing with jurisdiction of the High Court under Article 226 of the Constitution of India, held that where there is an appropriate or equally efficacious remedy, the Writ Court should keep its hands off. But none of the authorities cited by Mr.
B.K. Jain ( AIR 1977 SC 1703 ) also, the Supreme Court, dealing with jurisdiction of the High Court under Article 226 of the Constitution of India, held that where there is an appropriate or equally efficacious remedy, the Writ Court should keep its hands off. But none of the authorities cited by Mr. Basu lay down, as absolute proposition of law, that jurisdiction of the High Court under Article 226 or 227 of the Constitution of India ought not to be exercised at all if there is alternative statutory remedy available. This being the legal position, in the given facts, I do not want to take a course different from the one taken by a Coordinate Bench in the case of Automobile Association of Eastern India (supra). Case had been made out at the prima facie stage for intervention by this Court invoking Article 227 of the Constitution of India. Points that have been urged before me relate to questions of law only. In a case of this nature, principles guiding invoking jurisdiction under Article 226 of the Constitution of India ought to be similar to a case instituted under Article 227 of the Constitution of India. Thus, I reject the objection on the ground of maintainability of this writ petition taken by the port trust. 11. It has been contended on behalf of the petitioner that so far as the fresh notices of show cause on the question of payment of damages is concerned, the petitioner had filed application before the Estate Officer seeking dismissal of these notices on the ground of limitation and no substantive response to these notices were given by them covering all aspects of the dispute. Complaint of the petitioner on this point is that in the impugned order, the Estate Officer adjudicated the question of imposition of damages on merit of the two proceeding taken out under the provisions of Section 7 of the 1971 Act. This course of action taken by the Estate Officer, it was urged on behalf of the petitioner, constituted miscarriage of justice. 12. I have also been addressed by the learned counsel for the petitioner and the port trust on the question of legality of the claim of the port trust for damages.
This course of action taken by the Estate Officer, it was urged on behalf of the petitioner, constituted miscarriage of justice. 12. I have also been addressed by the learned counsel for the petitioner and the port trust on the question of legality of the claim of the port trust for damages. Main case of the petitioner on this point is that the alleged debt relating to the period starting from 31st December 1994, as specified in the said notices, is barred under the statute of limitation. The stand of the petitioner on this point is that the demand for damages, if any, can relate back to three years from the date of issue of notice under Section 7 (2)and (3) of the 1971 Act, and not beyond that period. Substantial argument has been advanced before me on this aspect and the authorities cited on behalf of the parties in this regard are the cases of New Delhi Municipal Committee Vs. Kalu Ram & Anr (AIR 1976 SC page 2446), State of Kerala Vs. V.R. Kalliyanikutty ( AIR 1999 SC 1305 ), Consolidated Engineering Enterprises Vs. Principal Secretary, Irrigation Department & Ors. [ 2008(7) SCC 169 ], Banatwala and Company Vs. LIC of India ( AIR 2011 SC 3619 ), M.P. Steel Corporation Vs. Commissioner of Central Excise[ (2015)7 SCC 58 ], the case of Automobile Association of Eastern India (supra), Shri G.R. Gupta Vs. Lok Sabha Secretariat [204 (2013) DLT 694] and L.S. Nair Vs. Hindustan Steel Ltd. ( AIR 1980 MP 106 ). 13. On behalf of the port trust, it has been submitted that the provisions of Limitation Act do not extend to the 1971 Act and the limitation period for instituting a suit for recovery of money as contained in the First Division of the schedule to the Limitation Act 1963 only relates to institution of suits. Their stand is that a proceeding under Section 7 of the 1971 Act cannot be equated with a suit. The petitioner on the other hand argued through their counsel that the law of limitation applies to a proceeding under Section 7 of the 1971 Act. The petitioner wants application of Article 87 of the First Division of the schedule to argue that the claim of the port trust if any has to remain confined to this article, which stipulates:- “87.
The petitioner wants application of Article 87 of the First Division of the schedule to argue that the claim of the port trust if any has to remain confined to this article, which stipulates:- “87. For Compensation for trespass upon immovable property.” Three years The date of the trespass 14. One of the points on which the petitioner sought to invoke the jurisdiction of this Court under Article 227 of the Constitution of India is that the petitioner had filed two applications for dismissal of the notices issued under Section 7(2) of the 1971 Act but the Estate Officer had determined the question of grant of damages on merit. This has been pleaded in paragraphs 7 and 17 in C.O. No. 1876 of 2014 and in C.O. No. 1877 of 2014, same pleading has been repeated. As there is no affidavit from the port trust, there is no effective denial of these statements made by the petitioner. In the impugned order also there is reference to the nature of the petitions which were filed. The Estate Officer, however, has determined the validity for claim of damages on merit. In my opinion, for this purpose another opportunity ought to have been given to the petitioner and both the proceedings instituted by the notices under Section 7 (2)and (3) of the 1971 Act ought to be reheard by the Estate Officer on merit. There is no indication in the order impugned as to why the matter was decided on merit on the claim for damages. The proper course for the Estate Officer should have been to dismiss the two petitions filed by the petitioner, if the Estate Officer was satisfied that the petitions filed before him were not legally sustainable, and fix another date for hearing the cases on merit. The course adopted by the Estate Officer was not legally proper. For this reason alone, in my opinion, the impugned order ought to be set aside and the matter be remanded to the Estate Officer for rehearing. 15. While remanding matter to the Estate Officer, I also want to determine the position of law which was also argued before me by the petitioner as also the opposite party on the point of the claim for damages being barred under the law of limitation.
15. While remanding matter to the Estate Officer, I also want to determine the position of law which was also argued before me by the petitioner as also the opposite party on the point of the claim for damages being barred under the law of limitation. I am undertaking this exercise as this point is bound to come up for determination before the Estate Officer when he takes up the case on merit, and clarification of law on that point in this judgement would prevent reagitation of this point again before this Court or the Appellate forum, if any of the parties chose to challenge the final order of the Estate Officer, whichever way that order goes. In fact, the Estate Officer had examined this issue as well, holding in substance, that the provisions of the Limitation Act are applicable to civil suits only, instituted before the Courts governed by the Code of Civil Procedure and does not guide proceedings under the 1971 Act. 16. It was urged before me on behalf of the petitioner that any claim on account of damages ought to be barred under the law of limitation and on this point the cases of Kalu Ram (supra), the Automobile Association of Eastern India (supra) and G.R. Gupta Vs. Lok Sabha Secretariat [204(2013) DLT 694] have been relied upon. Mr. Basu’s argument on this point on behalf of the port trust is that claim for damages is in the nature of mesne profit. In a civil suit, on a cause of action of this nature, it is open to the plaintiff to institute a suit for recovery of possession along with a suit for enquiry into mesne profits and subsequent decree on the sum found due on such enquiry. Alternatively, it was argued by Mr. Basu, a suit for mesne profit can be independently instituted after there is determination that possession of a defendant was unauthorised. In the latter case, the limitation period for claiming mesne profits in a suit would be from the date there is decree in favour of the plaintiff. It is also his argument that the provisions of the Limitation Act relates to a suit, and not applicable to a proceeding under the provisions of 1971 Act. On this point he has relied on a judgment of the Supreme Court in the case of M.P. Steel Corporation (supra).
It is also his argument that the provisions of the Limitation Act relates to a suit, and not applicable to a proceeding under the provisions of 1971 Act. On this point he has relied on a judgment of the Supreme Court in the case of M.P. Steel Corporation (supra). In this judgment, upon considering the decision of the Supreme Court in the case of Consolidated Engineering Enterprises (supra) it has been held that though provisions of Section 14 applies only to Courts as understood in the strict sense of being part of the judicial branch of the State, the principles contained therein would apply to applications filed before quasi-judicial tribunal also. The decision of the Supreme Court in the case of Banatawala & Co envisages primacy of the 1971 Act in respect of areas covered by it, if in conflict with any State Act. The first two authorities exclude direct application of the provisions of the Limitation Act in relation to proceedings under special statutes, whereas the third authority establishes primacy of the 1971 Act on the area covered by it. But none of these authorities deal with the question of recovery of rent or damages under the provisions of 1971 Act, which claim would have been barred under the law of limitation if a civil suit was brought. 17. In the decision of the Supreme Court in the case of New Delhi Committee Vs. Kalu Ram (supra), the question of applicability of laws of limitation on a proceeding under Section 7 of the Public Premises (Eviction of Unauthorised Occupants Act) 1958 was examined. It was held in this judgment:- “The only contention raised before us by Mr. Hardy appearing for the appellant is that the High Court was wrong in holding that the amount in question could not be recovered under section 7 because the time for instituting a suit to recover the sum had expired. Admittedly, any suit instituted on the date when the Estate Officer made his order under section 7(1) would have been barred by time. Mr. Hardy argued that the Limitation Act only barred the remedy by way of suit and did not extinguish the right, and section 7 of the Public Premises (Eviction of Unauthorised Occupants) Act providing a different and special mode of recovery was therefore available to recover rent in arrears beyond three years.
Mr. Hardy argued that the Limitation Act only barred the remedy by way of suit and did not extinguish the right, and section 7 of the Public Premises (Eviction of Unauthorised Occupants) Act providing a different and special mode of recovery was therefore available to recover rent in arrears beyond three years. Section 7 as it stood at the relevant time reads : “7. Power to recover rent or damages in respect of public premises as arrears of land revenue. (1) Where any person is in arrears of rent payable in respect of any public premises, the estate officer may, by order, require that person to pay the same within such time and in such instalments as may be specified in the order. (2) Where any person is, or has at any time been in unauthorised occupation of any public premises, the estate officer may, having regard to such principles of assessment of damages as may be prescribed, assess the damages on account of the use and occupation of such premises and may, by order, require that person to pay the damages within such time and in such instalments as may be specified in the order: Provided that no such order shall be made until after the issue of a notice in writing to the person calling upon him to show cause within such time as may be specified in the notice why such order should not be made, and until his objections, if any, and any evidence he may produce in support of the same, have been considered by the estate officer. (3) If any person refuses or fails to pay the arrears of rent or any instalments thereof payable under sub-section (1) or the damages or any instalment thereof payable under sub-section (2) within the time specified in the order relating thereto the estate officer may issue a certificate for the amount due to the Collector who shall proceed to recover the same as an arrear of land revenue." As would appear from the terms of the section, it provides a summary procedure for the recovery of arrears of rent.
It was argued that since section 7 did not put a time limit for taking steps under that section and as the limitation prescribed for a suit to recover the amount did not apply to a proceeding under this section, the High Court was in error in upholding the respondent's objection. In support of his contention that a debt remained due though barred by limitation, Mr. Hardy relied on a number of authorities, both Indian and English. We do not consider it necessary to refer to these decisions because the proposition is not disputed that the statute of limitation bars the remedy without touching the right. Section 28 of the Indian Limitation Act, 1908 which was in force at the relevant time however provided that the right to any property was extinguished on the expiry of the period prescribed by the Act for instituting a suit for possession of the property. But on the facts of this case no question of a suit for possession of any property arises and section 28 has no application. It is not questioned that a creditor whose suit is barred by limitation, if he has any other legal remedy permitting him to enforce his claim, would be free to avail of it. But the question in every such case is whether the particular statute permits such a course. Does section 7 of the Public Premises (Eviction of Unauthorised Occupants) Act, 1958 create a right to realize arrears of rent without any limitation of time? Under section 7 the Estate Officer may order any person who is in arrears of rent 'payable' in respect of any public premises to pay the same within such time and in such instalments as he may specify in the order. Before however the order is made, a notice must issue calling upon the defaulter to show cause way such order should not he made and, if he raised any objection, the Estate Officer must consider the same and the evidence produced in support of it. Thus the Estate Officer has to determine upon hearing the objection the amount of rent in arrears which is 'payable.' The word 'payable' is somewhat indefinite in import and its meaning must he gathered from the context in which it occurs. 'Payable' generally means that which should be paid.
Thus the Estate Officer has to determine upon hearing the objection the amount of rent in arrears which is 'payable.' The word 'payable' is somewhat indefinite in import and its meaning must he gathered from the context in which it occurs. 'Payable' generally means that which should be paid. If the person in arrears raises a dispute as to the amount, the Estate Officer in determining the amount payable cannot ignore the existing laws. If the recovery of any amount is barred by the law of limitation, it is difficult to hold that the Estate Officer could still insist that the said amount was payable. When a duty is cast on an authority to determine the arrears of rent, the determination must be in accordance with law. Section 7 only provides a special procedure for the realisation of rent in arrears and does not constitute a source or foundation of a right to claim a debt otherwise time-barred. Construing the expression "any money due" in section 186 of the Indian Companies Act, 1913 the Privy Council held in Hans Raj Gupta and others v. Official Liquidators of the Dehradun Mussorie Electric Tramway Company Ltd.(1) that this meant moneys due and recoverable in suit by the company, and observed: "It is a section which creates a special procedure for obtaining payment of moneys; it is not a section which purports to create a foundation upon which to base a claim for payment. It creates no new rights." We are clear that the word "payable" in section 7, in the context in which its occurs, means "legally recoverable." Admittedly a suit to recover the arrears instituted on the day the order under section 7 was made would have been barred by limitation. The amount in question was therefore irrecoverable. This being the position, the appeal fails and is dismissed with costs. Appeal dismissed.” 18. The ratio of this judgment has subsequently been followed by the Supreme Court in State of Kerala Vs. V.R. Kalliyanikutty & Anr. ( AIR 1999 SC 1305 ). A Division Bench of the Madhya Pradesh High Court in the case of L.S. Nair Vs.
This being the position, the appeal fails and is dismissed with costs. Appeal dismissed.” 18. The ratio of this judgment has subsequently been followed by the Supreme Court in State of Kerala Vs. V.R. Kalliyanikutty & Anr. ( AIR 1999 SC 1305 ). A Division Bench of the Madhya Pradesh High Court in the case of L.S. Nair Vs. Hindustan Steel Ltd. ( AIR 1980 MP 106 ) had taken a contrary view, on the ground that in the case of Kalu Ram provisions of Section 7(1) of the 1958 Act was involved, and the interpretation given to Section 7(1) of the said Act could not be applied to the provisions of Section 7(2) of the Act. The Division Bench of the Madhya Pradesh High Court in that judgement referred to the decision of Kalu Ram delivered by the Punjab and Haryana High Court, which was later affirmed by the Supreme Court. In these two proceedings, it is exercise of power by the Estate Officer under Section 7(2) of the Act is involved. On that basis, the decision of the High Court in the case of Kalu Ram was sought to be distinguished by the learned counsel for the port trust. The other point on which Kalu Ram was distinguished in the case of L.S. Nair (supra) was that the in the case of Kalu Ram, Section 7(1) of the 1958 Act specified “rent payable” whereas Section 7(2) of the 1971 Act applies an entirely different language. With deepest respect, I am unable to agree with this reasoning of the Division Bench of the Madhya Pradesh High Court. The underlying reasoning of the Supreme Court decision in the case of Kalu Ram (supra) was that to claim certain amount through the mechanism of a special statute, the amount must be otherwise recoverable. Mere omission to employ the expression “due” to qualify the word “damages” in Section 7(2) of the 1971 Act in my opinion does not expose a debt under that head on account of unauthorized occupation of certain public premises to a timeless recovery period. If that provision is to be construed in that manner, in my opinion, express provision in the legislative instrument would be necessary. When a statute confers on an authority special power to recover money, in the absence of specific legislative provision, the sum shall be otherwise realizable through the regular judicial process.
If that provision is to be construed in that manner, in my opinion, express provision in the legislative instrument would be necessary. When a statute confers on an authority special power to recover money, in the absence of specific legislative provision, the sum shall be otherwise realizable through the regular judicial process. That is the ratio of the judgment of the Supreme Court in the case of Kalu Ram (supra) I am of the view that in Sub-section (2) of Section 7 of the 1971 Act, it is implicit that damages must be due to be recoverable. Power vested with the Estate Officer to assess damages shall relate to such damages which would be recoverable. 19. A Coordinate Bench of this Court in the case of Automobile Association of Eastern India (supra) has held:- “Mr. Sanyal's submissions, with regard to the reasons which prompted the Supreme Court not to allow recovery of claims barred by limitation in Kalu Ram's case (supra) are not borne out by the judgments of the Supreme Court. A judgment is a precedent for what it decides and not what might logically be deduced from it. The Supreme Court found, that it was not in dispute that if a creditor, whose claim was barred by limitation, had any other legal remedy, permitting him to enforce his claim, he would be free to avail of the remedy provided of course the remedy authorised the recovery of a time-barred claim. The Supreme Court raised the question of whether Section 7 of the 1958 Act authorised the Estate Officer to realize arrears of rent that were time-barred. The question was answered by the Supreme Court in the negative. The judgment of the Division Bench of the Madhya Pradesh High Court in L.S. Nair vs. Hindustan Steel Ltd. (supra) was rendered without considering the judgment of the Supreme Court in New Delhi Municipal Committee vs. Kalu Ram. Judgments rendered in Nityanand M. Joshi Vs. Life Insurance Corporation of India (supra) and Town Municipal Council, Athani vs. Presiding Officer (supra) in the context of an application under Section 33 (c) (2) of the Industrial Disputes Act, 1947 are not applicable, the judgment in Kalu Ram's case being directly on Section 7 of the 1958 Act which has almost verbatim been reenacted and reproduced in the 1971 Act, with some minor, inconsequential differences.
The Estate Officer thus lacked jurisdiction to entertain a time barred claim. The impugned order is also violative of principles of natural justice. It is not necessary for this Court to adjudicate the disputed question of fact of whether the petitioner gave up possession on 14th March, 2000 or in February, 2006. Nor is it necessary for this Court to decide any disputed questions of fact. The question is whether there is any infirmity in the decision making process. For reasons already discussed, this Court is constrained to hold that the decision making process itself is vitiated.” 20. The judgment of the Supreme Court in the M.P. Steel Corporation (supra) deals with the situation where the principles of Limitation Act would be applicable on legal for a outside the regular Court structure and where it would not. The case of Consolidated Engineering Enterprises (supra) is also an authority dealing with applicability of the principles contained in Section 14 of the Limitation Act to a proceeding under Section 34(3) proviso of the Arbitration and Conciliation Act 1996 but exclusions of the provisions of Section 5 of the Limitation Act to such proceeding. So far as applicability of the Limitation Act 1963 in relation to time-barred debt is concerned the Supreme Court decision in the case of Kalu Ram (supra) proceeds on a different line of reasoning. In the event recovery of certain sum of money is time-barred under the 1963 Act, such recovery beyond the prescribed time cannot be made through other statutory provisions guiding special situations contemplated under the statute. A Coordinate Bench of this Court in the case of Automobile Association of Eastern India (supra) has already followed Kalu Ram (supra) I do not find any reason to take a contrary view. 21. On behalf of the port trust it was also argued that the judgment of the Supreme Court in the case of Kalu Ram was delivered without considering the amended provision of Section 15 of the 1971 Act. Under the said provision, as it stands now, jurisdiction of the Civil Court has been barred in relation to entertaining any suit or proceeding pertaining to, inter alia, eviction of any person who is in unauthorized occupation of any public premises.
Under the said provision, as it stands now, jurisdiction of the Civil Court has been barred in relation to entertaining any suit or proceeding pertaining to, inter alia, eviction of any person who is in unauthorized occupation of any public premises. In my opinion, however, this provision is not of significance so far as the applicability of the ratio of the decision of the Supreme Court in the case of Kalu Ram (supra) is concerned. The 1971 Act creates an exclusive mechanism for public undertakings to recover their property and dues, but no right is created under this statute to recover dues which would not have been recoverable through a regular suit. 22. Under the provisions of 1971 Act, a proceeding for eviction and a proceeding for damages are two independent provisions, and a proceeding for damages can be initiated once the Estate Officer is satisfied that the addressee of the notice is in unauthorized occupation of any public premises. On behalf the petitioner, it was urged that this claim should be treated as a suit for mesne profits and such claim ought to be made in the form of a prayer for enquiry or assessment of mesne profit at the time of institution of proceeding for eviction of an unauthorized occupant. Otherwise, petitioner’s case is that such claim would be barred, if lodged at a date beyond the limitation period. To this argument, Mr. Basu’s contention was that claim for mesne profit can be lodged after possession has been found by the Court to be unauthorized. But having regard to the special provisions of 1971 Act relating to recovery of possession of immovable property and dues in respect thereof, I do not think the principles guiding a suit for recovery of possession can be implanted into a proceeding initiated under the provisions of the 1971 Act. In my opinion, proceeding for damages under the 1971 Act can be commenced subsequent to finding of the Estate Officer that occupation of certain property is unauthorized, provided the proceeding is instituted within the period permissible under the law of limitation. In the case of Automobile Association of Eastern India (supra), a Coordinate Bench found claim made under that head beyond the limitation period to be time-barred. 23.
In the case of Automobile Association of Eastern India (supra), a Coordinate Bench found claim made under that head beyond the limitation period to be time-barred. 23. There is, however, one factual distinction so far as the disputes in these two proceedings are concerned in relation to the dispute involved in the case of Automobile Association of Eastern India. In that case eviction order was passed under the 1971 Act on 22nd February 2000 and the petitioner therein surrendered possession of the leasehold land on 14th March 2000. The notice for damages under Section 7 of the 1971 Act was issued on 28th May 2005. There was thus lapse of five years in issuing the notice. In these two cases, it does not appear from the pleading as to whether the original proceeding under Section 4 of the 1971 Act was formally concluded or not, and if it was formally concluded, what was the date of such conclusion. The condition precedent for issue of notice under Section 7(2) of the 1971 Act is that the noticee at any time must have had been in unauthorized occupation of any public premises. The power to issue such notice vests in the Estate Officer after determination that a person is in unauthorized occupation. In the impugned decision, there is reference to an order of the Estate Officer dated 2nd July 2012 on which date the Estate Officer came to conclusion that occupation of the petitioner had become unauthorized with the service of notices for revocation of license dated 18th February 1985 and 23rd February 1985. Such determination is required to be made through proper adjudication process and there is no material available before this Court from which it can be ascertained the manner in which such adjudication took place, if it did. It is also not clear as to whether opportunity of hearing was given to the petitioner before adjudicating whether the petitioner was in unauthorized occupation. Such adjudication in these two cases would be necessary as the matter was pending since the year 1985 and possession was taken of the lease property in the year 2010. 24. In such circumstances, in my opinion, determination made on petitioner’s obligation to pay damages in the impugned decision while dealing with the petitioner’s application for dismissal of the notices for damages was improper.
24. In such circumstances, in my opinion, determination made on petitioner’s obligation to pay damages in the impugned decision while dealing with the petitioner’s application for dismissal of the notices for damages was improper. I also do not accept the view of the Estate Officer that he is not guided by the law of limitation. I have already explained the reason as to why I am of this opinion. 25. In these circumstances the impugned order stands quashed and the Estate Officer of the port trust is directed to rehear the matter in the light of my observations contained in this judgment. Decision shall be taken by the Estate Officer afresh within a period of eight weeks from the date of communication of this judgement and order after giving opportunity of hearing to the petitioner on the application filed by the petitioner. 26. Urgent Photostat certified copy of this order be given to the parties expeditiously, if applied for.