URVAKUNJ NICOTINE LTD - Petitioner(s) Versus UNION OF INDIA & 3 - Respondent(s) ========================================= Appearance :
MR ASIM J. PANDYA for HL PATEL ADVOCATES for Petitioners in SPECIAL CIVIL APPLICATIONS No.18842 of 2011, 18844 to 18865 of 2011 MR MIHIR THAKORE, SR. ADVOCATE with MR ASIM PANDYA for Petitioners in SPECIAL CIVIL APPLICATION No.18843 of 2011 MR DHAVAL DAVE, SR. ADVOCATE with MR UDAYEN VYAS for Petitioners in SPECIAL CIVIL APPLICATIONS No.18000 to 18803 of 2011 MR SATYAJEET DESAI for Petitioner in SPECIAL CIVIL APPLICATIONS No.18794 to 18797 of 2011 MS MEGHA JANI for Petitioner in SPECIAL CIVIL APPLICATION No.136 of 2012 MR PS CHAMPANERI for Respondent : 1, MR HARIN RAVAL, SR. ADVOCATE with MR DHAVAL D VYAS for Respondent : 2 & 4 NOTICE SERVED BY DS for Respondent : 3, ========================================= CORAM : HONOURABLE MS.JUSTICE HARSHA DEVANI Date : 27/02/2012 ORAL ORDER :
1. Learned advocates for the petitioners have tendered draft SCA/18842/2011 2/34 ORDER amendments in each of the petitions. The amendments are allowed in terms of the drafts. The same shall be carried out forthwith.
2. All these petitions raise common questions of facts and law and hence, the same were heard together for the purpose of admission and grant of interim relief. Since Special Civil Application No.18843 of 2011 has been argued as the lead petition, reference is made to the facts as appearing in the said petition.
3. By these petitions under Article 226 of the Constitution of India, the petitioners have challenged the decision dated 26.8.2011 of the respondent No.2 - Kandla Port Trust of not renewing the leases of the petitioners and demanding back the possession of the leased lands from the petitioners. The petitioners have prayed that the respondent No.1 be directed to grant approval to the separate resolutions passed by the respondent No.2 - Kandla Port Trust in respect of each of the petitioners whereby decisions have been taken to renew the leases in favour of the petitioners for a further period of thirty years or less as the case may be. The petitioners have also challenged the decision dated 8.7.2011 of the respondent No.1 refusing to grant approval to the resolutions of the Kandla Port Trust and directing the respondent No.2 not to renew the leases of the petitioners; the notices of eviction issued by the respondent No.4 under the Public Premises (Eviction of Unauthorized Occupants) Act, 1971 in case of individual petitioners as well as the revised compensation bills issued by the respondent No.2 in case of individual petitioners.
SCA/18842/2011 3/34 ORDER
4. The facts giving rise to the present petitions stated briefly are that the petitioners in each of the petitions were given lands on lease by the respondent No.2 - Kandla Port Trust from time to time by separate leases for a period of thirty years; in some cases, for a period of less than thirty years. The lease period in the case of each of the petitioners expired in the years 2003 and 2004. Prior to the expiry of the lease, the petitioners exercised option under clause (9) of the respective indentures of lease for renewal of the leases for a further period of thirty years. The Kandla Port Trust vide separate resolutions in case of individual petitioners, decided to renew the leases for a further period of thirty years and forwarded the proposals recommending such renewal to the Central Government. In the meanwhile, somewhere around September, 2009, a writ petition by way of public interest litigation came to be presented before the Delhi High Court, seeking a writ of mandamus against the Union of India to take back possession of 16,000 acres of Government land and seeking eviction of the persons in occupation of the said lands. The petitioners therein, inter alia, sought a declaration that leases granted arbitrarily on nomination basis on port land henceforth be declared as null and void and it be directed that the land henceforth may be leased out to private sectors and individuals only on the basis of competitive bidding and lease rental of 6% of the market value of property. The petitioners also sought an independent investigation by a Special Investigation Team into the role of officers of the Shipping Ministry and Kandla Port Trust in allowing illegal occupation of Government land at the Kandla Port Trust.
5. Before the Delhi High Court, the learned Assistant Solicitor SCA/18842/2011 4/34 ORDER General was initially directed by the court by an order dated 9.9.2009 not to execute/renew any lease except in accordance with the guidelines issued by the Ministry of Shipping in 2004. The proceedings are still pending before the Delhi High Court which is monitoring the entire process and has directed that leases should not be renewed and that fresh lease should be given by way of public auction. The court also appears to have directed that steps be taken under the provisions of the Public Premises (Eviction of Unauthorized Occupants) Act, 1971 for evicting the lessee whose leases have expired, within a stipulated time frame. Subsequently, on 15.12.2010, the learned Assistant Solicitor General assured the Delhi High Court that before the next date of hearing, no further renewal of lease shall take place without leave of the said court. Later on, vide order dated 23.2.2011, the court ordered that the interim order passed on the earlier occasion shall remain in force until further orders.
6. It appears that the writ petitioners in Special Civil Application No.18843 of 2011 approached this court by way of a writ petition being Special Civil Application No.2362 of 2008 to set aside the decision of the respondents conveyed to the petitioners through the mode of caveat dated 2.2.2008 by the respondent No.1 filed before the Court of the learned Principal Civil Judge, Gandhidham, Kutch, for taking back the land admeasuring 1010.156 acres, situated at Kandla allotted by the respondent No.1 - Kandla Port Trust on lease basis. The petitioners also prayed for an appropriate writ directing the respondents to renew the lease of the land admeasuring 1010.156 acres allotted by the Kandla Port Trust as per clause (9) of the indenture of lease deed executed between the SCA/18842/2011 5/34 ORDER Kandla Port Trust and the erstwhile allottee. The said petition came to be disposed of vide order dated 25.2.2010 with a direction to the respondent No.1 to afford an opportunity of hearing to the petitioners therein and after considering the reply of the petitioners, take appropriate decision thereon and communicate the same to the petitioners within a period of four weeks from the date of conclusion of the hearing. The court further directed that status quo prevailing on the said date qua construction, title and possession of the land in question shall be maintained save and except the day to day routine manufacturing and other business activities of the petitioner company. Pursuant to the aforesaid order, after affording an opportunity of hearing to the said petitioners, vide order dated 13.7.2010, the lease came to be extended till 31.3.2011. It may be noted that in the case of the other writ petitioners, they had no occasion to approach this court and as such, there was no direction to the respondent No.1 to consider their cases. However, in case of all the other petitioners, the Ministry vide order dated 27th July, 2010 renewed the respective leases upto 31.03.2011. Thereafter, individual notices came to be issued to the individual petitioners on different dates for handing over the possession of the premises on the ground that the Central Government has, by communication dated 8.7.2011, decided not to extend the leases any further. Subsequently, the notices came to be issued under the provisions of the Public Premises (Eviction of Unauthorized Occupants) Act, and the proceedings are pending before the Estate Officer. Later on, compensation bills have been raised by the Kandla Port Trust seeking payment thereunder. Being aggrieved, the petitioners have presented the present writ petitions.
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7. It may be noted that in response to the averments made in the petitions, none of the respondents have chosen to file any affidavit in-reply in the matter. However, a copy of the writ petition filed before the Delhi High Court as well as various orders passed by the Delhi High Court from time to time have been placed on record by the learned advocate appearing on behalf of the Kandla Port Trust.
8. Mr. Mihir Thakore, learned Senior Advocate with Mr. Asim Pandya, learned advocate appearing on behalf of the petitioners in Special Civil Application No.18843 of 2011 invited attention to the provisions of clause (9) of the original indenture of lease, to submit that the same specifically contains a covenant for renewal at the option of the lessee. It was submitted that the petitioners having already exercised their option for renewal of the lease of the demises premises, the Kandla Port Trust is, therefore, obliged to renew the lease. It was pointed out that the Kandla Port Trust, on an independent assessment of the matter, had vide separate resolutions decided to renew the lease for a further period of thirty years with effect from 10.4.2004 to 9.4.2034. Section 34 of the Major Ports Trust Act, 1963 (hereinafter referred to as "the Act"), contemplates obtaining the approval of the Central Government where the lease is for a period exceeding thirty years. It was contended that in the present case, the petitioners seek renewal of lease for a period of thirty years which is well within the authority of the Kandla Port Trust as envisaged under section 34 of the Act and hence, there was no need for the Kandla Port Trust to seek the approval of the Central Government. It was submitted that renewal of a lease SCA/18842/2011 7/34 ORDER amounts to a fresh lease and hence, each lease being a separate lease, the period of the separate leases cannot be clubbed together. Accordingly, if a particular lease is for a period not exceeding thirty years, no approval of the Central Government is necessary.
9. Inviting attention to the order dated 13.7.2010 whereby the Government of India has renewed the lease till 31.3.2011, it was argued that if the Kandla Port Trust has taken a decision to renew the lease for thirty years, the Central Government has no authority to reduce the same as Kandla Port Trust has a statutory right to grant leases not exceeding a period of thirty years. Referring to clause 6.2.2.2 of the Land Policy for Major Ports (hereinafter referred to as the "Land Policy"), it was submitted that clause (b) thereof provides that if renewal is provided for in the existing lease agreement, it can be renewed for a total period not exceeding thirty years including the original lease period; and clause (d) thereof provides that extension/renewal of any lease for the original lessee beyond thirty years would be made only after the recommendation of the Board, recording clearly the reasons thereof and the approval of the Empowered Committee and that such cases will be finalized by the Ministry of Shipping. It was submitted that the said clause runs contrary to the provisions of section 34 of the Act inasmuch as, section 34 vests in the Kandla Port Trust a right to execute leases for a period not exceeding thirty years. Reliance was placed upon the decision of the Supreme Court in the case of Delhi Development Authority v. Durga Chand Kaushish, (1973) 2 SCC 825, for the proposition that a renewal of a lease is really the grant of a fresh lease. It is called a "renewal" simply because it postulates the existence SCA/18842/2011 8/34 ORDER of a prior lease which generally provides for renewals as of right. In all other respects, it is really a fresh lease. It was submitted that under the circumstances, renewal of lease being a fresh lease, there is no question of clubbing the period of earlier lease and the subsequent lease for computing the period of thirty years under section 34 of the Act. It was further submitted that the leases granted by the Kandla Port Trust are statutory leases and that the right of the Kandla Port Trust to enter into leases for a period not exceeding thirty years is unfettered. Accordingly, the Port or the Ministry has to exercise discretion in consonance with the Act and the Policy.
10.Next it was submitted that the entire decision not to renew the leases in favour of the petitioners is based upon the orders passed by the Delhi High Court in the writ petition by way of a public interest litigation presented before the said court. Inviting attention to the resolutions passed by the Kandla Port Trust approving of the proposals for renewing the lease in favour of the petitioners for a period of thirty years, it was submitted that the petitioners are seeking enforcement of the aforesaid decision of the Kandla Port Trust which has authority to renew the lease. However, the leases have been renewed only upto March 2011 as a result of the public interest litigation filed before the Delhi High Court. It was submitted that the petitioners are aggrieved by the reference by the Kandla Port Trust to the Central Government seeking approval of the lease. According to the learned counsel, the Kandla Port Trust which is the competent authority to take a decision in this regard has taken a decision to extend the lease for thirty years and that the petitioners are seeking enforcement of the said decision. In the meanwhile, till the leases are renewed, no coercive steps SCA/18842/2011 9/34 ORDER should be taken against the petitioners. It was argued that though no new lease deeds have been executed, there is an approval by the authority who has to approve it. It was argued that the Kandla Port Trust is required to independently consider the question of renewal of the leases in favour of the petitioners and that it is not permissible for the Central Government to issue directions interfering with the exercise of the Kandla Port Trust of its statutory powers under section 34 of the Act. Referring to the various provisions of the Act, it was submitted that even under section 111 of the Act, the Central Government cannot issue directions which are violative in the face of the statute.
11.It was argued that the entire cause of action in the above- referred writ petition presented before the Delhi High Court has arisen within the territorial jurisdiction of this High Court and the Delhi High Court lacks territorial jurisdiction to decide the said case or to pass any orders thereon. Under the circumstances, the orders passed by the Delhi High Court being without jurisdiction are non est and required to be ignored by this court. It was urged that the petitioners have a right to approach this court for enforcement of a statutory right in respect of which they have come before this court which has the jurisdiction to adjudicate the same. It was further submitted that even if the respondents do not renew the lease in the light of the orders of the Delhi High Court, but the petitioners should not be evicted from the premises in question. It was urged that in the circumstances, the petitions deserve to be admitted by granting interim relief restraining the respondents from evicting the petitioners.
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12..Mr. Dhaval Dave, learned Senior Advocate, with Mr. Udayan Vyas, learned advocate for the writ petitioners in Special Civil Application No.18800 to 18003 of 2011, adopted the submission advanced by the Mr. Thakore and further submitted that in view of the provisions of section 34 of the Act, the Kandla Port Trust is empowered to execute leases for a period not exceeding thirty years. By the various resolutions passed by it, the Kandla Port Trust has decided to renew the leases in favour of the petitioners for a period of thirty years. Though the resolutions operate on their own strength, concurrence of the Central Government has been sought under section 34(1) of the Act. It was submitted that the decision taken by the Central Government not to renew the leases in favour of the petitioners beyond 31.3.2011 appears to be in view of the statement made by the learned Assistant Solicitor General before the Delhi High Court. According to the learned counsel, the counsel for the respondent No.1 could not have made any statement contrary to the statutory provisions and that even if such statement has been made, the same would not prevent the petitioners from seeking an appropriate redressal before this court. It was urged that pending the petitions, the possession of the petitioners is required to be protected.
13.Mr. Dave further submitted that in exercise of powers under section 34 of the Act, the Kandla Port Trust is required to exercise discretion on its own and should not be weighed down by instructions of any other authority. Reliance was placed upon the decision of the Supreme Court in the case of Commissioner of Police, Bombay v. Gordhandas Bhanji, AIR 1952 SC 16, for the proposition that when a discretion is vested in an authority, he is bound to exercise it and bring to SCA/18842/2011 11/34 ORDER bear on the matter his own independent and unfettered judgement and decide for himself. Adverting to the facts of the present case, it was submitted that the Kandla Port Trust instead of exercising discretion by independently deciding the question as to whether or not the leases should be renewed, is acting upon the instructions of the Central Government. It was submitted that the authority which is vested with the power is required to exercise it and it should not be acted upon instructions of any other authority while exercising its statutory powers. The learned counsel submitted that non- implementation of the decision of the Kandla Port Trust and the threat of eviction has been opposed by the respondents on the ground of litigation before the Delhi High Court. It was submitted that assuming that the respondents are right in their submission that they have to honour the statement made before the Delhi High Court, at best, the petitioners cannot pray for renewal of the lease. However, today the petitioners are in possession and if ultimately no relief is granted and the petitioners are removed, then even if possession is to be restored, they will suffer irreparable damages. In the circumstances, the possession of the petitioners is required to be protected for the time being. Referring to the order dated 12.10.2011 passed by the Delhi High Court, it was submitted that the same would cover those persons whose leases have come to an end and are in illegal occupation, whereas in the facts of the present case, a decision has been taken by the Kandla Port Trust to renew the leases and as such, the petitioners would not fall within the ambit of the order dated 12.10.2011 passed by the Delhi High Court. It was submitted that in the circumstances, there is no question of any conflicting orders being passed by this court in case relief is SCA/18842/2011 12/34 ORDER granted to the petitioners.
14.Mr. Asim Pandya, learned advocate appearing for the writ petitioners in Special Civil Applications No.18442 of 2011 and 18844 to 18865 of 2011 was emphatic about the fact that the Kandla Port Trust has not chosen to file any reply controverting the averments made in the petitions. It was submitted that before the Delhi High Court, the counsel for the Union of India had made a wrong concession stating that the leases would not be renewed without the approval of the Delhi High Court. According to the learned counsel a wrong concession made by the counsel cannot bind the parties, more so, when it was not a statement made by the Kandla Port Trust which is the authority vested with the statutory powers of renewing the leases. In support of his submissions, the learned counsel placed reliance upon the decision of the Supreme Court in the case of Union of India v. Mohanlal Likumal Punjabi, AIR 2004 SC 1704, for the proposition that wrong concession made by a counsel cannot bind the parties when statutory provisions clearly provided otherwise. That apart, the applicability of the statute or otherwise to a given situation or the question of statutory liability of a person/institution under any provision of law would invariably depend upon the scope and meaning of the provisions concerned and has got to be adjudged not on any concession made. Any such concessions would have no acceptability or relevance while determining rights and liabilities incurred or acquired in view of the axiomatic principle, without exception, that there can be no estoppel against statute. It was submitted that the statement made by the learned Assistant Solicitor General, at best, is a stand of the Central Government which has to be tested on the anvil of SCA/18842/2011 13/34 ORDER the statutory provisions. It was submitted that the statement made by the learned Assistant Solicitor General was without any authority of law and flies in the face of the provisions of section 34 of the Act. Under the circumstances, the power of judicial review cannot be taken away. It was further submitted that the petitioners before the Delhi High Court have not joined the affected parties and hence, the statement will not bind the petitioners as well as this court.
15.Mr. Pandya invited the attention of the court to the affidavit filed by the Kandla Port Trust before the Delhi High Court in the above referred writ petition to submit that the litigation before the Delhi High Court is different in nature and this court should not be influenced by the said litigation. Referring to the relevant Land Policy, it was submitted that the same states that a lease can be renewed even if there is no renewal clause. The only requirement is that if it is needed for the Port's use, such renewal may not be granted. It was urged that the respondents have not filed any affidavit stating that the land is required for the use of the port and as such there is no justification for denying renewal of the leases in favour of the petitioners.
16.Ms. Megha Jani, learned advocate for the writ petitioners in Special Civil Application No.136 of 2012 adopted the submissions made by Mr. Thakore and invited attention to the Land Policy of 2010, to submit that the same contemplates renewal of existing leases and that the ground not to renew the lease is contrary to the Land Policy. It was further submitted that insofar as the question of revised compensation bill is concerned, the Kandla Port Trust has forwarded the proposal to SCA/18842/2011 14/34 ORDER the Tariff Authority for Major Ports (TAMP) and that as of today, they are paying lease rent as per the rates prescribed by the TAMP. However, the revised compensation bill has been issued on the basis of the proposed rates for the last year, which are not yet approved. It was submitted that the Kandla Port Trust can charge as per the rates prescribed by the TAMP and it is not permissible for it to charge on the basis of proposed rates. It was submitted that the petitioners are already paying rent at the rates prescribed by the TAMP and that they can be put to condition of payment of 10% of the proposed rates.
17.Ms. Jani further submitted that the petitioner was never informed regarding the renewal of the lease upto 31.3.2011 and came to know about the same only when the petitioner received the letter dated 26.8.2011 informing the petitioner that the competent authority - Union of India has by the communication dated 8th July, 2011 conveyed its decision not to renew/extend the term under/of lease and rights there under. It was submitted that the Kandla Port Trust which is the competent authority had, on 4.2.2003, taken a decision to renew the lease for a period of twenty years, under the circumstances, since the lease does not exceed a period of thirty years, in view of the provisions of section 34 of the Act it was well within the authority of the Kandla Port Trust to renew the lease and as such the decision of the Union of India not to renew the lease is without any authority of law.
18.Mr. Satyajeet Desai, learned advocate for the petitioners in Special Civil Applications No.18794 to 19797 of 2001 has reiterated the submissions advanced by Mr. Mihir Thakore and Mr. Dhaval Dave.
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19.Opposing the petitions, Mr. Harin Raval, learned Senior Advocate with Mr. Dhaval Vyas, learned advocate for the respondent No.2 - Kandla Port Trust invited attention to the provisions of the Act and more particularly to section 2(ia), which defines "immovable property" and section 2(k) which defines "land" and section 29(1)(a) which relates to public properties vested in the Board, to point out that from the appointed day in relation to any port, all property, assets and funds and all rights to levy rates vested in the Central Government or, as the case may be, any other authority for the purposes of the port immediately before such day, shall vest in the Board. Referring to the provisions of section 34 of the Act, it was submitted that there has to be a purposive and meaningful interpretation of section 34, otherwise it will tend to permit the Board to circumvent the provision by executing successive contracts. According to the learned counsel, what has to be seen is the overall tenure and that the provisions of section 34 of the Act, cannot be interpreted to defeat the statutory intent. Inviting attention to sub-section (i) of section 111 of the Act, which empowers the Central Government to issue directions to the Board, it was submitted that the authority and every Board, in the discharge of its functions under the Act, is bound by such directions on questions of policy as the Central Government may give in writing from time to time. It was submitted that under the circumstances, the Board is bound by the Policy framed by the Central Government in the discharge of its functions under the Act.
20.The learned counsel further invited the attention of the court to the various orders passed by the Delhi High Court from time SCA/18842/2011 16/34 ORDER to time in the above referred writ petition. Referring to the order dated 9.9.2009 whereby the learned Assistant Solicitor General was directed till further orders not to execute/renew any lease except in accordance with the guidelines issued by the Ministry of Shipping in 2004, it was submitted that the said order was never vacated. Inviting attention to the order dated 23.2.2011, it was pointed out that it has been directed that the interim order passed on an earlier occasion shall remain in force until further orders. It was submitted that the Delhi High Court is in seisin of the matter and is monitoring the same and as such, any interim relief granted by this court would be in direct conflict with the directions issued by the Delhi High Court. It was submitted that the petitioners have been communicated that by orders dated 13.7.2010 and 27.7.2010 as the case may be, the competent authority - Union of India has extended their leases till 31.3.2011. It was submitted that the said orders also fly in the face of the orders passed by the Delhi High Court and as such the officer who has passed the orders is under a serious cloud. It was urged that in keeping with judicial comity, unless there is a variation of the order of the Delhi High Court in the matter of auction, extension and in the matter of expectation that all proceedings under the Public Premises (Eviction of Unauthorized Occupants) Act, would be concluded within three months from the order dated 11 th January, 2010, this court ought not to grant any interim relief as any order of protection that may be passed by this court would be contradictory to the orders passed by the Delhi High Court. It was submitted that an order without jurisdiction does not bear any seal of invalidity unless the same is expressly set aside. Reliance was also placed upon the decision of the Supreme Court in the case of Krishnadevi Malchand SCA/18842/2011 17/34 ORDER Kamathia and others v. Bombay Environmental Action Group and others, (2011) 3 SCC 363, and more particularly paragraph 16 thereof, to submit that it is a settled legal proposition that even if an order is void, it requires to be so declared by a competent forum and it is not permissible for any person to ignore the same merely because in his opinion, the order is void. It was submitted that the competent forum to say that the order of the Delhi High Court is bad is the Supreme Court which is the appropriate forum. Under the circumstances, the respondent authorities are bound by the orders passed by the Delhi High Court and as such, the respondents would be put in an embarrassing position if orders contradictory to the directions issued by the Delhi High Court are passed by this court in the present petitions. It was submitted that in all the cases, the leases have been extended till 31.3.2011 and vide order dated 13.7.2010 in the case of the writ petitioners in Special Civil Application No.18843 of 2011 and vide order dated 27.7.2010 in cases of other writ petitioners, and the said orders are duly communicated to the petitioners. Inviting attention to the reliefs claimed in the petitions, it was pointed out that the orders dated 13.7.2010 and 27.7.2010 are not subject matter of challenge in any of the petitions and that the said orders have been permitted to live through and the petitioners have acquiesced with the same.
21.Reliance was placed upon a decision of the Supreme Court in the case of APM Terminals S.B.V. v. Union of India and another, (2011) 6 SCC 756, for the proposition that the Government is entitled to change its policy with changing circumstances. The Government has the discretion to adopt a different policy, alter or change its policy to make it more SCA/18842/2011 18/34 ORDER effective. The only qualifying condition is that such a change in policy must be free from arbitrariness, irrationality, bias and malice and must be in conformity with the principle of Wednesbury reasonableness. Reverting to the facts of the present case, it was submitted that the Central Government has decided to go for auctioning the lands held by the Kandla Port Trust as stated before the Delhi High Court. Accordingly, the petitioners have been communicated by the Kandla Port Trust vide communications dated 26.8.2011 that the competent authority - Union of India has conveyed its decision not to renew/extend the term under/of the lease and their rights thereunder. It was submitted that in view of the fact that the lease had not been renewed beyond 23.3.2011, notices dated 25.11.2011 came to be issued under sub-section (1) and clause (b) (ii) of sub-section (2) of section 4 of the Public Premises (Eviction of Unauthorized Occupants) Act, 1971. Reliance was placed upon an unreported decision of the Supreme Court in the case of Centre for Public Interest Litigation and others v. Union of India and others in Writ Petition (Civil) No.423 of 2010, on 2.2.2012, wherein the Supreme Court has held that in the field of contracts, the State and its instrumentalities should design their activities in a manner which would ensure competition and non- discrimination. They can augment their resources but the object should be to serve the public cause and to do public good by resorting to fair and reasonable methods. The learned counsel further submitted that the matter is under examination of the Delhi High Court whose jurisdiction has not been questioned. In the memorandum of the petitions, the petitioners have themselves stated that they would be filing appropriate proceedings before the Delhi High Court and the SCA/18842/2011 19/34 ORDER Supreme Court to set right the whole proceedings. In the circumstances, at this juncture, there is no cause for entertaining the petitions. Reliance was placed upon a decision of the Supreme Court in the case of Union of India and another v. International Trading Co. & another, (2003) 5 SCC 437, for the proposition that if the State Government acts within the bounds of reasonableness, it would be legitimate to take into consideration the national priorities and adopt trade policies. The ultimate test is whether on the touchstone of reasonableness the policy decision comes out unscathed. Reasonableness of restriction is to be determined in an objective manner and from the standpoint of interests of the general public and not from the standpoint of the interests of persons upon whom the restrictions have been imposed or upon abstract consideration. A restriction cannot be said to be unreasonable merely because in a given case, it operates harshly. It was submitted that in the facts of the present case, the action of the respondents has not been challenged as being mala fide.
22.Inviting attention to the provisions of clause (9) of the lease deed, it was pointed out that the right sought to be enforced by the petitioners is a right of contract. The right to renewal is a one time stand alone right and there is no time limit. It was submitted that the said right has been dealt with by the appropriate authority and stands exhausted. In the circumstances, there is no further right to seek an extension. It was submitted that in the present case, no prejudice is caused to the petitioners who are not debarred from taking part in a transparent mode of dealing with the government property and that discretionary remedy and equitable considerations prevail SCA/18842/2011 20/34 ORDER and public interest outweighs the private interest. It was, accordingly, urged that the petitions being devoid of merit, are required to be dismissed.
23.Mr. P. S. Champaneri, learned Assistant Solicitor General for the respondent No.1 - Union of India has adopted the submissions advanced by Mr. Harin Raval.
24.In rejoinder, dealing with the contention that the order dated 13.7.2010 has not been challenged by the petitioners, Mr. Thakore invited attention to the first paragraph of the writ petition which sets out the challenge in the petition wherein the petitioner has specifically stated that the petitioner is challenging the decision dated 13.7.2010. It was submitted that, however, it appears that due to inadvertence, the same has been left out in the relief clause. It was submitted that in other cases, such orders extending the leases have never been communicated to the petitioners. It was argued that according to the respondents, a public interest litigation is pending before the Delhi High Court wherein the orders have been passed from time to time. The question that, therefore, arises for consideration is as to whether this court has jurisdiction to entertain the present petitions and if the petitioners have a lis, whether the court can grant the relief. It was argued that the Union of India may be bound by the directives of the Delhi High Court; however, though they are directly affected, the petitioners herein are not parties before the Delhi High Court. It was submitted that the orders passed by the Delhi High Court being without jurisdiction are non-est and not binding upon the petitioners though binding upon the Government. According to the learned counsel the orders passed by the Delhi High Court SCA/18842/2011 21/34 ORDER have put an embargo on the petitioners approaching the jurisdictional High Court. Reliance was placed upon the decision of the Supreme Court in the case of Kiran Singh and others v. Chaman Paswan, AIR 1954 SC 340, for the proposition that it is a fundamental principle well established that a decree passed by a court without jurisdiction is a nullity, and that its invalidity could be set up whenever and wherever it is sought to be enforced or relied upon, even at the stage of execution and even in collateral proceedings. A defect of jurisdiction, whether it is pecuniary or territorial, or whether it is in respect of the subject-matter of the action, strikes at the very authority of the court to pass any decree, and such a defect cannot be cured even by consent of parties. It was submitted that under the circumstances, the petitioners can plead that the orders of the Delhi High Court are nullity in collateral proceedings. Reliance was placed upon the decision of the Supreme Court in the case of Chief Engineer, Hydel Project v. Ravinder Nath, AIR 2008 SC 1315, for the proposition that neither consent nor waiver nor acquiescence can confer jurisdiction upon a court, otherwise incompetent to try the suit. It is well settled and needs no authority that "where a court takes upon itself to exercise a jurisdiction it does not possess, its decision amounts to nothing". A decree passed by a court having no jurisdiction is non-est and its invalidity can be set up whenever it is sought to be enforced as a foundation for a right, even at the stage of execution or in collateral proceedings. A decree passed by a court without jurisdiction is a coram non judice. Adverting to the facts of the present case, it was submitted that the jurisdiction to decide the controversy vests with this court and as such, the petitioners cannot be forced to approach the Delhi High Court.
SCA/18842/2011 22/34 ORDER It was submitted that all the orders of the Delhi High Court cannot deprive the petitioners of their rights as they have not been passed after hearing them. It was submitted that the petitioners are claiming rights under section 34 of the Act, which contemplates the Kandla Port Trust taking a decision on the question of renewal of lease. The Kandla Port Trust having taken a decision to renew the same, the Union of India has no power to reduce the period. It was submitted that the petitioners are not disputing that the lands leased out to the petitioners are not natural resources. However, the petitioners have applied to the Kandla Port Trust for renewal of leases and that the Kandla Port Trust has passed resolution renewing the same and that a third party, namely, Union of India cannot over ride the jurisdiction of the Kandla Port Trust. It was, accordingly, urged that the applications for renewal have to be considered only by the Kandla Port Trust and none other and at this stage, the petitioners require protection from proceedings taken under the Public Premises (Eviction of Unauthorized Occupants) Act as they have a valid and sustainable right, as pleaded by them.
25.The facts as appearing in the petitions are that initially, leases have been either granted to the petitioners or to their predecessors in title from whom the leases have been transferred in their favour with the approval of the competent authority. The initial leases granted in favour of the petitioners have expired in the years 2003 and 2004. The petitioners have exercised their right under clause (9) of the indenture of lease seeking renewal of the respective leases for a period of thirty years. The Kandla Port Trust has passed separate resolutions in case of individual petitioners and decided to renew the leases SCA/18842/2011 23/34 ORDER for thirty years or twenty years, as the case may be, and have forwarded proposals for the approval of the Central Government. In the meanwhile, the above referred writ petition has been filed by way of public interest litigation before the Delhi High Court wherein the said High Court has passed various orders from time to time. A perusal of the orders passed by the Delhi High Court indicates that on 9.9.2009, the learned Assistant Solicitor General had been directed not to execute/renew any lease except in accordance with the guidelines issued by the Ministry of Shipping in 2004. The order dated 11.11.2009 records that an affidavit in-reply has been filed by the Kandla Port Trust stating that it has set up a port- based Special Economic Zone (SEZ) at Kandla with an area of 6000 hectares against which formal approval from the Ministry of Commerce and Industry has been received in May 2007 for an area of 5000 hectares. It is further stated in the affidavit that the Kandla Port Trust has also informed the Central Government of their intention of taking back possession of salt lands falling under the area of the proposed SEZ. The Kandla Port Trust has requested the Ministry not to renew the leases of the salt lands. However, no decision appears to have been taken by the Central Government in respect of the above request made by the Kandla Port Trust. Vide order dated 15.12.2010, the Delhi High Court has recorded that, "Though many a issues have been raised today by the learned counsel for the parties yet, at present, we are only inclined to address to one issue whether there should be renewal of lease beyond March, 2011.
There has to be a long debate on this issue and on the points which have been canvassed by Mr. Prashant Bhushan with regard to non-initiation of prosecution against the SCA/18842/2011 24/34 ORDER officers concerned and the action required to be taken against the Joint Secretary, Ministry of Shipping. In praesenti, we only record that Mr. Chandiok has assured this Court that before the next date of hearing, no further renewal of lease shall take place without leave of this Court."
26.Vide order dated 23.2.2011, the court directed that interim order passed on earlier occasion shall remain in force until further orders. On 4.4.2011, the court passed an order, inter alia, in the following terms:
"[3] The next issue that emerges for consideration pertains to steps required to be taken in respect of grant/renewal of the lease hold rights of the salt land. Mr. A.S. Chandhiok submitted that 6500 acres of land has been demarcated by the Kandla Port Trust to be part of the Special Economic Zone. It is stated that proceedings for eviction have been initiated against persons who are in unauthorized occupation of the said area. The same shall be finalized within a period of three months from today.
[4] We have been apprised that tenders were called for in respect of 10 plots to arrive at a set price. The plots were of 50 acres and 100 acres. The highest bid obtained in the auction for a 50 acres plot is approximately Rs.2.52 lacs per acre for a period of thirty years but the total payment has to be affront. As far as 100 acres plots are concerned, the highest bid is approximately Rs.2.75 lacs for each acre for thirty years. Mr. Chandhiok has submitted that this is the price which has been obtained in the tenders and there might be negotiations with the previous lease holders.
[5] In order to ensure that best offers are received, we feel that more plots should be put to tender-cum-auction bidding after wide publicity and accordingly, it is directed that 10 more plots admeasuring 100 acres and 5 more plots admeasuring 50 acres be put to competitive bidding through fresh tender-cum-auction. Wide publicity shall be given in national newspapers as well as taking recourse to e-tendering process within two months hence."
SCA/18842/2011 25/34 ORDER
27.On 3.6.2011, the matter was adjourned to 24.8.2011 for the learned Assistant Solicitor General to state what steps have been taken to comply with the order dated 4.4.2011 and an affidavit of the Chairman of the Kandla Port Trust was also directed to be filed. Vide order dated 12.10.2011, the Delhi High Court observed that it expects that all proceedings under section 9 of the Public Premises (Eviction of Unauthorized Occupants) Act would be concluded within three months from the said date.
28.Thus, it appears that pursuant to the above referred writ petition, which has been entertained by the Delhi High Court, the said High Court is monitoring the matter and has passed interim orders from time to time. It is not in dispute that the above referred writ petition has been filed in respect of the lands held on lease by the petitioners and that various orders have been passed by the Delhi High Court from time to time in compliance with which, the Central Government has issued various directions to the respondent No.2 - Kandla Port Trust.
29.Adverting to the facts of the present case, various indentures of lease have been executed between the respective petitioners on the one hand and the Kandla Port Trust on the other. In case of four of the petitioners, lease deeds contain clause (9). Insofar as the other petitioners are concerned, they have placed reliance upon the Land Policy framed by the Central Government in respect of the lease of lands by the Kandla Port Trust. Clause (9) of the said lease deed reads as follows :
SCA/18842/2011 26/34 ORDER "9. The lessee, observing and performing all the agreements, covenants and conditions hereof will on expiration of the term reserved herein, be granted at his/her option a new lease of the demised premises by way of renewal for a further period as may by mutual arrangements be decided to commence from the date of expiry thereof on such conditions as the lessor may in his absolute direction then determine."
Thus, under clause (9) of the lease deed, upon the expiration of the lease, a new lease can be granted by the Kandla Port Trust at the option of the lessee of the demised premises by way of renewal for a further period as may by mutual arrangement be decided.
Insofar as the other petitioners are concerned, the indenture of lease does not contain any clause for renewal of the lease. However, the said petitioners have placed reliance upon clause 6.2.2.2 of the Land Policy which inter alia provides for renewal of existing leases and have contended that for the purpose of granting fresh lease not exceeding a period of thirty years, the Kandla Port Trust is not required to obtain approval of the Central Government.
30.Thus, the basis of the claim of the petitioners is section 34 of the Act which makes provision for "Mode of executing contracts on behalf of Board" and reads thus:
34. Mode of executing contracts on behalf of Board.-- (1) Every contract shall, on behalf of a Board, be made by the Chairman 1[or by any such officer of the Board not be- low the rank of the Head of a department as the Chairman may, by general or special order, authorise in this behalf] and shall be sealed with the common seal of the Board:
SCA/18842/2011 27/34 ORDER Provided that no contract whereof the value or amount exceeds such value or amount as the Central Government may from time to time fix in this behalf shall be made unless it has been previously approved by the Board:
Provided further that no contract for the acquisition or sale of immovable property or for the lease of any such property for a term exceeding thirty years, and no other contract whereof the value or amount exceeds such value or amount as the Central Government may from time to time fix in this in this behalf, shall be made unless it has been previously approved by the Central Government. (2) Subject to the provisions of sub-section (1), the form and manner in which any contract shall be made under this Act shall be such as may be prescribed by regulations made in this behalf.
(3) No contract which is not made in accordance with the provisions of this Act and the regulations made thereunder shall be binding on the Board.
The second proviso to section 34 of the Act which is relevant for the present purpose mandates that no contract for the acquisition or sale of immovable property or for the lease of any such property for a term exceeding thirty years, shall be made unless it has been previously approved by the Central Government.
31.The crux of the matter, therefore, depends upon interpretation of the second proviso to section 34 of the Act, as to whether the duration of thirty years mentioned therein would include the original lease or would apply to each individual lease, viz., original lease as well as renewed lease.
32.In the opinion of this court, on a meaningful reading of section 34 of the Act, prima facie, it appears that the same would SCA/18842/2011 28/34 ORDER mean the total period of lease granted in favour of each lessee in respect of a particular plot of land and would include the period of the original lease. Else, as rightly contended by Mr. Harin Raval, the Kandla Port Trust could circumvent the provisions of section 34 of the Act by granting successive leases, each for a period not exceeding thirty years.
33.From the facts as emerging from the record of the case, it is apparent that the lease period in case of each of the petitioners has expired a long time back in the years 2003- 2004. The said leases have been extended upto 31.3.2011 by the orders dated 13.7.2010 and 27.7.2010 respectively passed by the respondent No.1. Thus, as on date, there is no subsisting lease between the petitioners and the Kandla Port Trust.
34.On behalf of the petitioners, strong reliance has been placed on the separate resolutions passed by the Kandla Port Trust in the year 2003 and 2004 in case of each of the petitioners, deciding to renew the leases in favour of the petitioners for a period of thirty years/twenty years, as the case may be. By these petitions, the petitioners seek a direction to the respondent No.1 to grant approval to the resolutions passed by the Kandla Port Trust to renew the leases in favour of the petitioners for a further period of thirty/twenty years. The aforesaid claim is primarily based on the argument that in view of the provisions of section 34 of the Act, the Kandla Port Trust is not required to obtain the approval of the Central Government while executing the lease for a period not exceeding thirty years, inasmuch as, each lease is a fresh lease, accordingly while computing the period of thirty years as SCA/18842/2011 29/34 ORDER contemplated under section 34, the period of the original lease is not required to be included. Considering the above view taken by this court on an interpretation of section 34 of the Act, the said contention as a necessary corollary would stand negatived. Moreover, as is apparent from the averments made in the petitions, the resolutions passed by the Kandla Port Trust are in the nature of notings on a file. Pursuant to the said resolutions, it does not appear as if the decision of the Kandla Port Trust has been communicated to the petitioners, nor have the petitioners been assured as regards renewal of their leases as sought for by them. It is well settled that notings recorded in official files merely represent expression of opinion by the particular individual/individuals. Such notings even if recorded by the competent authority on merits of matter under consideration, cannot be termed as a decision unless acted upon by issuing an order pursuant thereto. The Kandla Port Trust appears to have construed the provisions of section 34 of the Act to mean that it is not authorized to renew the lease in favour of the lessee beyond a period of thirty years inclusive of the period of the original lease, and has, accordingly, sought the approval of the Central Government for further renewal of the leases. It also appears to be the case of the Kandla Port Trust that it requires some of the lands for its own purpose and has, accordingly, requested the Central Government not to extend the leases in such cases.
35.Section 34 of the Act provides for the manner in which every contract made on behalf of the Board is required to be executed. In the facts of the present case, it is apparent that there is no subsisting contract between the Kandla Port Trust and the petitioners renewing the leases in favour of the SCA/18842/2011 30/34 ORDER petitioners. Renewal of the leases in favour of the petitioners has been made by the Central Government under orders dated 13.7.2010 and 27.7.2010, whereby the leases have been extended till 31.3.2011. In the circumstances, as noticed earlier with effect from 31.3.2011, there is no subsisting lease in favour of the petitioners in terms of section 34 of the Act.
36.A perusal of the order dated 13.7.2010 made in the case of the petitioner in Special Civil Application No.18843 of 2011, extending the lease for a period till 31.3.2011 shows that in respect of the proposal for renewal of the said lease, the Kandla Port Trust had filed a reply stating that they have formed a business development plan for Kandla Port Trust as per which the area currently held by M/s Friends Salt Works & Allied Industries (M/s FSWAI) is shown to be area reserved for commercial activity. Therefore, the lease should not be renewed in favour of M/s FSWAI. It is further recorded that the Kandla Port Trust is of the view that land, if auctioned, will fetch hefty income and will be helpful for overall development of Kandla Port Trust and also encourage port related activities of SEZ. Kandla Port Trust further reported that as per CWPRS report, the area for salt production near Nankil creek will add to the siltation problem in the Kandla creek, it will increase dredging cost, and therefore, no further allotment has been made in its report.
37.Thus, it appears that the Central Government, in the light of the fact that the Kandla Port Trust requires some of the lands for its own purposes as well as for the reasons aforesaid, and considering the orders passed by the Delhi High Court from time to time, has taken a decision not to renew the leases in SCA/18842/2011 31/34 ORDER favour of the petitioners. Insofar as the order dated 13.7.2011 is concerned, prima facie, the said petitioner has no reason to be aggrieved by the same, as the said order has been passed pursuant to proceedings taken in compliance with the order passed by this High Court in Special Civil Application No.18843 of 2011. Moreover, the said order does not contain any observations or findings adverse to the petitioners. The same merely records submissions of the petitioners and the Kandla Port Trust and extends the lease since the Kandla Port Trust was yet to report sufficient progress in furtherance of their business development plan where the land held by the said petitioner is shown to be reserved for commercial activities. As regards the order dated 27.7.2011 passed in case of the other petitioners, the same does not form part of the record. However, it appears that vide the said order all that is done is that the leases granted in favour of the said petitioners have been extended upto 31.3.2011.
38.Under section 111 of the Act, the Central Government is empowered to issue directions to the Board in the discharge of its functions under the Act and the Board is bound by such directions on question of policy as the Central Government may give in writing to it from time to time. In exercise of the said powers, the Central Government has framed the Policy for Major Ports, 2001, clause 6.2.2.2 of which reads as under:
"6.2.2.2 - Renewal of Existing Leases :
[a] The port should first verify if land is required for its own use. If it is so required, the Port shall take possession of the land on expiry of the lease.
use, the port should then check whether land use is consistent with the Land Use Plan. If it is so, and if renewal is provided for in the existing lease agreement, it can be renewed for a total period not exceeding thirty years including the original lease period. The lease rent/upfront premium should not be less than prevailing SoR or on market value, whichever is higher. No compensation will be payable by the port in the event of refusal to renew the lease.
[c] If the option for renewal is not provided for in the existing lease agreement, the port at its discretion, may decide to grant a fresh lease in favour of the existing lease at the terms to be approved by the Board, without public auction/tender. The lease rent/upfront premium should not be lower than the SoR duly updated or the market value as the case may be.
[d] Extension/renewal of any lease for the original lessee beyond thirty years would be made only after the recommendation of the Port Trust Board, recording clearly the reasons thereof, and the approval of the Empowered Committee. Such cases will be finalized by the Ministry of Shipping.
[e] After the expiry/termination/determination of lease and despite receiving the notice thereof, or forfeiture of lease on account of change of user, assignment etc., if the lessee continues to occupy it unauthorizedly, the lessee shall be liable to pay compensation for wrongful use and occupation at three (3) times the lease rent in accordance with the prevailing SoR till vacant possession is obtained.
[f] For existing leases, at the time of expiry/termination/ determination of lease the provisions related to removal of structures will be applicable. If no such provisions exist, the lessee shall remove all structures at his own cost within three (3) months of expiry/termination/determination failing which these will vest with the port free from all encumbrances. If the port so decides for reasons to be recorded, it may also take over the structures on terms mutually agreed with the lease holder."
SCA/18842/2011 33/34 ORDER
39.Under the above referred policy, it has been specifically provided that if renewal is provided in the existing lease agreement, it can be renewed for a total period not exceeding thirty years, including the original lease period. Clause (d) thereof provides that such cases shall be finalized by the Ministry of Shipping. Thus, prima facie, it cannot be said that the policy is not in consonance with the provisions of section 34 of the Act. In the opinion of this court, clause (9) of the lease deed has to be read in consonance with section 34 of the Act whereby, the lease can be renewed at the option of the lessee for a further period as may by mutual agreement be decided, and the Kandla Port Trust is empowered to renew the lease for a period not exceeding thirty years including the period of the original lease. However, if the lease period exceeds thirty years, the same would be subject to the approval of the Central Government.
40.Considering the fact that the petitions involve the interpretation of provisions of section 34 of the Act as well as the validity of the Land Policy framed by the Central Government, the court is of the view that the matters require consideration. Hence, Issue Rule in each of the petitions. However, in the light of the aforesaid discussion, the court is not inclined to grant interim relief as prayed for in the petition. Nonetheless, considering the fact that the decision taken by the Central Government not to renew the leases in favour of the petitioners appears to be primarily based upon the proceedings filed before the Delhi High Court by way of Public Interest Litigation (WP) No.11550 of 2009 wherein various orders have been passed by the Delhi High Court from time to time, in which proceedings the petitioners though directly SCA/18842/2011 34/34 ORDER affected, have not been impleaded as respondents, it would be in the interest of justice if the petitioners are granted some protection for the purpose of approaching the appropriate forum.
41.While declining to grant interim relief as prayed for by the petitioners, in the interest of justice, the respondents are directed to maintain status quo in respect of the lands possessed by the petitioners in each of these cases for a period of four weeks from today to enable the petitioners to approach the appropriate forum.
42.It is clarified that the observations made hereinabove are tentative in nature and that the same shall not act to the prejudice of the petitioners in any proceeding before any forum.
[HARSHA DEVANI, J.] parmar*