{"id":129034,"date":"2010-10-01T00:00:00","date_gmt":"2010-09-30T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/n-pappa-kannan-vs-the-collector-on-1-october-2010"},"modified":"2016-06-17T17:57:58","modified_gmt":"2016-06-17T12:27:58","slug":"n-pappa-kannan-vs-the-collector-on-1-october-2010","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/n-pappa-kannan-vs-the-collector-on-1-october-2010","title":{"rendered":"N.Pappa Kannan vs The Collector on 1 October, 2010"},"content":{"rendered":"
Madras High Court<\/div>\n
N.Pappa Kannan vs The Collector on 1 October, 2010<\/div>\n
       \n\n  \n\n  \n\n \n \n BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT\n\nDATED: 01\/10\/2010\n\nCORAM\nTHE HON'BLE MR.JUSTICE M.JAICHANDREN\n\nW.P.(MD).No.2857 of 2010\n&\nW.P.(MD).No.9063 of 2010\nand\nM.P.(MD).Nos.1 & 2 of 2010 in W.P.(MD).No.2857 of 2010\nand\nM.P.(MD).No.2 of 2010 in W.P(MD).No.9063 of 2010\n\nN.Pappa Kannan\t\t\t.. Petitioner in both WPs\n\nVs\n\n1.The Collector,\n  Theni District,\n  Theni.\n\n2.The Municipal Commissioner,\n  Bodinaickkanur Municipality,\n  Bodinaickkanur.\n\n3.The Board of Council,\n  Bodinaickkanur Municipality,\n  Bodinaickkanur.\n\t\t\t        ..Respondents in W.P(MD).No.2857 of 2010\n\n1.The Divisional Officer,\n  Fire Service and Rescue Department,\n  Theni Division,\n  Theni.\n\n2.The District Collector,\n  Theni District,\n  Theni.\n\n3.The Municipal Commissioner,\n  Bodinaickkanur Municipality,\n  Bodinaickkanur,\n  Theni District.\n\n\n4.The Station Officer,\n  Fire Service and Rescue Station,\n  Bodinaickkanur,\n  Theni District-625 513.\n\t\t\t\n\t\t\t         ..Respondents in W.P(MD).No.9063 of 2010\n\nW.P(MD).No.2857 of 2010\n\nPetition filed under Article 226 of the\nConstitution of India praying for the issuance of a Writ of Certiorarified\nMandamus to call for the records relating to the impugned proceedings in\nNa.Ka.No.215\/09\/A3, dated 05.02.2010, and quash the same and consequently\nforbear the second respondent from interfering with the petitioner's right to\ncarry on business in the name and style of Sr.Pungaj Bhavan inside the municipal\nbus stand for the further period of 01.04.2009 to 31.04.2012.\n\nW.P(MD).No.9063 of 2010\n\nPetition filed under Article 226 of the\nConstitution of India praying for the issuance of a Writ of Certiorari to call\nfor the records pertaining to the impugned order of the first respondent vide\nRef.x.K.No.2041\/n\/2010-2011, dated 06.04.2010 and the consequential order of the\nfourth respondent, dated 02.07.2010, quash the same.\n\n!For petitioner\t\t...  Mr.S.S.Sundar\n (for both WPs)\nW.P.(MD).No.2857 of 2010\n^For R.1 \t\t...  Mr.R.Manoharan\n\t\t\t     Govt.Advocate\nFor R.2\t\t\t...  Mr.Pala.Ramasamy\n\t\t\t     Spl.Govt.Pleader\nW.P(MD).No.9063 of 2010\nFor R.1 & 2\t\t...  Mr.R.Manoharan\n\t\t\t     Govt.Advocate\n******\n<\/pre>\n
:COMMON ORDER
\n\t \tSince the issues arising for consideration, and the facts and
\ncircumstances of both the Writ Petitions are similar in nature, a common order
\nis passed.\n<\/p>\n
\t\t2. In W.P.(MD).No.2857 of 2010, the petitioner has prayed for a Writ
\nof Certiorarified Mandamus to call for the records and to quash the impugned
\nproceedings  of the second respondent, dated 05.02.2010, made in
\nNa.Ka.No.215\/09\/A3 and to restrain the second respondent from interfering with
\nthe petitioner’s right to carry on his business inside the municipal bus stand,
\nBodinaickkanur, from 01.04.2009 to 31.04.2012.  Like wise, in W.P.(MD).No.9063
\nof 2010, the petitioner has prayed for a Writ of Certiorari to call for the
\nrecords pertaining to the impugned order of the first respondent, issued vide
\nRef.x.K..No.2041\/n\/2010-2011, dated 06.04.2010, and the consequential order of
\nthe fourth respondent, dated 02.07.2010, and to quash the same.\n<\/p>\n
\t3. The petitioner has stated that he is carrying on his business in the
\nname and style of  “Sr.Pungaj Bhavan”, inside the municipal bus stand,
\nBodinaickkanur, Theni District, in an extent of 6252.5 Sq.ft.  It has been
\nfurther stated that the property bearing shop Nos.3 and 4 had been leased out in
\nfavour of one Venkatachalam Reddiar, from the year 1965. Thereafter, the
\nproperty had been leased out to the petitioner’s father Late.Nammalwar, from the
\nyear, 1974.  After the death of the petitioner’s father, on 02.01.1996, the
\nlease had been transferred in favour of the petitioner, by the proceedings of
\nthe second respondent, dated 14.03.1997.  The petitioner is running a vegetarian
\nrestaurant in the premises in question, catering to those, who are using the
\nmunicipal bus stand at Bodinaickkanur.\n<\/p>\n
\t\t4. It has also been stated that, by the proceedings of the second
\nrespondent, in Na.Ka.No.7313\/2005\/A3, dated 08.03.2006, the lease had been
\nrenewed in favour of the petitioner, from  01.04.2006 to 31.03.2009. While so,
\non 02.07.2009, the petitioner had requested the second respondent to renew the
\nlease in favour of the petitioner for a further period of three years. The
\npetitioner had also paid a sum of Rs.3,404\/- for the renewal of the lease, as
\nper the direction issued by the second respondent, on 13.04.2009.  He has also
\nbeen paying the rent, with 15% hike in the monthly lease amount, till date,
\nwithout fail.  The respondent municipality in its Agenda No.29, had proposed to
\nrenew the lease, from 01.04.2009 to 31.03.2012, in its proceedings, in
\nNa.Ka.No.215\/09\/A3, dated 28.01.2010.  While so, the third respondent had
\ngranted the extension of lease to 35 lessees, who are similarly placed, like the
\npetitioner. However, the request of the petitioner for extension of lease had
\nbeen rejected, contrary to the principles of legitimate expectation and
\npromissory estoppel.\n<\/p>\n
\t\t5. The only ground based on which the request of the petitioner, for
\nthe extension of the lease period, had been rejected is that the petitioner has
\nbeen, unauthorisedly, occupying a large extent of the property, larger than the
\narea that had actually been alloted to him under the lease. As such, the
\npetitioner had encroached upon an area, which he is not entitled to, under the
\nlease agreement and he had also put up certain constructions thereon, without
\nthe permission of the authorities concerned. The allegation against the
\npetitioner regarding the encroachment is baseless and arbitrary in nature.  In
\nfact, the petitioner had filed a Civil Suit, in O.S.No.155 of 2009, on the file
\nof the District Munsif Court, Bodinaickkanur, against the second respondent,
\npraying for a decree and permanent injunction restraining the respondents
\ntherein from demolishing the eastern wall of the restaurant, under the guise of
\nremoving the unauthorised constructions.  An order of interim injunction had
\nalso been obtained by the petitioner, in I.A.No.154 of 2009.  While so, the
\nsecond respondent had issued the impugned proceedings, dated 05.02.2010, asking
\nthe petitioner to vacate the premises, within a period of 30 days.  Thus, the
\nrequest of the petitioner for the renewal of the lease had been rejected.\n<\/p>\n
\t\t6.\tIt has been further stated that the petitioner has been
\ncarrying on his business in the premises in question, for the past 13 years and
\nhis livelihood depends, solely, on the said business.  There are more than 23
\nemployees working in the Hotel, catering to thousands of persons.  It has also
\nbeen stated that the respondents, having directed the petitioner to pay the
\nadditional deposit, with a hike of 15%, as per the Government order, in
\nG.O.Ms.No.92, Municipal Administration and Water Supply Department, dated
\n03.07.2007, the rejection of the request of the petitioner, for the extension of
\nthe lease, by the respondents, is contrary to the principles of legitimate
\nexpectation and promissory estoppel.  There is no encroachment by the
\npetitioner, as alleged by the respondents.  Even though the petitioner has been
\nprepared to offer a higher lease amount, as fixed by the respondents, the
\nrespondents have rejected the request of the petitioner, without considering the
\nsame.  As such, the impugned proceedings of the respondents,  are arbitrary,
\nillegal and void.\n<\/p>\n
\t \t7.\tThe learned counsel appearing on behalf of the petitioner had
\nrelied on the following decisions in support of his contentions:-\n<\/p>\n
\t\t7.1. In Raghunandan Panda v. State of Orissa,<\/a> reported in (1975) 1
\nSCC 106, it has been held as follows:-\n<\/p>\n
\t“3. It has been pointed out by a Division Bench of this Court to which one
\nof us was a party in the case of Union of India v. K.P. Joseph<\/a> that “Generally
\nspeaking an administrative order confers no justiciable right but this rule like
\nall other general rules is subject to exceptions”. Some decisions of this Court
\nto illustrate the exceptions have been noticed thereafter in the judgment at
\npage. 755. It has been pointed out further “To say that an administrative order
\ncan never confer any right would be too wide a proposition. There are
\nadministrative orders which confer rights and impose duties”. In this case,
\nhowever, it is difficult to accept the argument put forward on behalf of the
\nappellant that the Rules confer any rights on him. No person has a vested right
\nto get any lease of the government land; of course, he has got a right to get
\nhis application for lease disposed of fairly and not arbitrarily. If, therefore,
\nit could be held in favour of the appellant that his claim for lease of the plot
\nin question was capriciously, arbitrarily and unfairly rejected and that the
\nlease granted to respondent No.3 was arbitrary and unfair a case could be found
\nin his favour.”\n<\/p>\n
\t\t7.2. In State of Assam v. Banshidhar Shewbhagavan & Co.,<\/a> reported in
\nAIR 1981 SC 1957, it has been held as follows:-\n<\/p>\n
“8….There can be no doubt that if any authority exercised any power conferred
\non him by law in bad faith or for collateral purpose, it is an abuse of power
\nand a fraud on the statute. In such a case there can be no difficulty in
\nstriking down that act of the authority by the issue of an appropriate writ
\nunder Article 226 of the Constitution.”\n<\/p>\n
\t\t7.3. In Dwarkadas Marfatia and Sons v. Bombay Port Trust,<\/a> reported
\nin (1989) 3 SCC 293, it has been held as follows:-\n<\/p>\n
\t“23……….Where any special right or privilege is granted to any public
\nor statutory body on the presumption that it must act in certain manner, such
\nbodies must make good such presumption while acting by virtue of such
\nprivileges. Judicial review to oversee if such bodies are so acting is
\npermissible.\n<\/p>\n
\t24. …… The Port Trust is statutorily exempted from the operation of
\nthe Rent Act on the basis of its public\/governmental character. The legislative
\nassumption or expectation as noted in the observations of Chagla, C.J. in
\nRampratap Jaidayal case1 cannot make such conduct a matter of contract pure and
\nsimple. These corporations must act in accordance with certain constitutional
\nconscience and whether they have so acted, must be discernible from the conduct
\nof such corporations. In this connection, reference may be made on the
\nobservations of this Court in Som Prakash Rekhi v. Union of India5<\/a> reiterated in
\nM.C. Mehta v. Union of India6<\/a> wherein at p. 148 this Court observed: (SCC p.
\n480, para 55)
\n“It is dangerous to exonerate corporations from the need to have constitutional
\nconscience ; and so, that interpretation, language permitting, which makes
\ngovernmental agencies, whatever their mien, amenable to constitutional
\nlimitations must be adopted by the court as against the alternative of
\npermitting them to flourish as an imperium in imperio.”\n<\/p>\n
……….\n<\/p>\n
\t27. We are inclined to accept the submission that every activity of a
\npublic authority especially in the background of the assumption on which such
\nauthority enjoys immunity from the rigours of the Rent Act, must be informed by
\nreason and guided by the public interest. All exercise of discretion or power by
\npublic authorities as the respondent, in respect of dealing with tenants in
\nrespect of which they have been treated separately and distinctly from other
\nlandlords on the assumption that they would not act as private landlords, must
\nbe judged by that standard. If a governmental policy or action even in
\ncontractual matters fails to satisfy the test of reasonableness, it would be
\nunconstitutional.”\n<\/p>\n
\t7.4.\tIn Mahabir Auto Stores v. Indian Oil Corpn.,<\/a> reported in AIR 1990
\nSC 1031,  it has been held as follows:-\n<\/p>\n
“It is well settled that every action of the State or an instrumentality of the
\nState in exercise of its executive power, must be informed by reason. In
\nappropriate cases, actions uninformed by reason may be questioned as arbitrary
\nin proceedings under Article 226 or Article 32 of the Constitution. …….. It
\nappears to us, at the outset, that in the facts and circumstances of the case,
\nthe respondent company IOC is an organ of the State or an instrumentality of the
\nState as contemplated under Article 12 of the Constitution. The State acts in
\nits executive power under Article 298 of the Constitution in entering or not
\nentering in contracts with individual parties. Article 14 of the Constitution
\nwould be applicable to those exercises of power. Therefore, the action of State
\norgan under Article 14 can be checked.”\n<\/p>\n
\t7.5.\tIn Shrilekha Vidyarthi v. State of U.P., reported in AIR 1991  SC
\n537, it has been held as follows:-\n<\/p>\n
“21. The Preamble of the Constitution of India resolves to secure to all its
\ncitizens Justice, social, economic and political; and Equality of status and
\nopportunity. Every State action must be aimed at achieving this goal. Part IV of
\nthe Constitution contains ‘Directives Principles of State Policy’ which are
\nfundamental in the governance of the country and are aimed at securing social
\nand economic freedoms by appropriate State action which is complementary to
\nindividual fundamental rights guaranteed in Part III for protection against
\nexcesses of State action, to realise the vision in the Preamble. This being the
\nphilosophy of the Constitution, can it be said that it contemplates exclusion of
\nArticle 14 – non-arbitrariness which is basic to rule of law – from State
\nactions in contractual field when all actions of the State are meant for public
\ngood and expected to be fair and just? We have no doubt that the Constitution
\ndoes not envisage or permit unfairness or unreasonableness in State actions in
\nany sphere of its activity contrary to the professed ideals in the Preamble. In
\nour opinion, it would be alien to the constitutional scheme to accept the
\nargument of exclusion of Article 14 in contractual matters. The scope and
\npermissible grounds of judicial review in such matters and the relief which may
\nbe available are different matters but that does not justify the view of its
\ntotal exclusion. This is more so when the modern trend is also to examine the
\nunreasonableness of a term in such contracts where the bargaining power is
\nunequal so that these are not negotiated contracts but standard form contracts
\nbetween unequals.\n<\/p>\n
\t……\n<\/p>\n
However, to the extent, challenge is made on the ground of violation of Article
\n14 by alleging that the impugned act is arbitrary, unfair or unreasonable, the
\nfact that the dispute also falls within the domain of contractual obligations
\nwould not relieve the State of its obligation to comply with the basic
\nrequirements of Article 14. To this extent, the obligation is of a public
\ncharacter invariably in every case irrespective of there being any other right
\nor obligation in addition thereto. An additional contractual obligation cannot
\ndivest the claimant of the guarantee under Article 14 of non-arbitrariness at
\nthe hands of the State in any of its actions.\n<\/p>\n
23. Thus, in a case like the present, if it is shown that the impugned State
\naction is arbitrary and, therefore, violative of Article 14 of the Constitution,
\nthere can be no impediment in striking down the impugned act irrespective of the
\nquestion whether an additional right, contractual or statutory, if any, is also
\navailable to the aggrieved persons.”\n<\/p>\n
\t7.6.\tIn Sterling Computers Ltd. v. M & N Publications Ltd.,<\/a> reported in
\n(1993) 1 SCC 445, it has been held as follows:-\n<\/p>\n
\t“17…..The powers of public authorities are therefore essentially
\ndifferent from those of private persons. A man making his will may, subject to
\nany rights of his dependants, dispose of his property just as he may wish. He
\nmay act out of malice or a spirit of revenge, but in law this does not affect
\nhis exercise of his power. In the same way a private person has an absolute
\npower to allow whom he likes to use his land, to release a debtor, or, where the
\nlaw permits, to evict a tenant, regardless of his motives. This is unfettered
\ndiscretion. But a public authority may do none of these things unless it acts
\nreasonably and in good faith and upon lawful and relevant grounds of public
\ninterest.\n<\/p>\n
\tThere are many cases in which a public authority has been held to have
\nacted from improper motives or upon irrelevant considerations, or to have failed
\nto take account of relevant considerations, so that its action is ultra vires
\nand void.”\n<\/p>\n
\t……\n<\/p>\n
\tBy way of judicial review the court cannot examine the details of the
\nterms of the contract which have been entered into by the public bodies or the
\nState. Courts have inherent limitations on the scope of any such enquiry. But at
\nthe same time as was said by the House of Lords in the aforesaid case, Chief
\nConstable of the North Wales Police v. Evans8 the courts can certainly examine
\nwhether “decision-making process” was reasonable, rational, not arbitrary and
\nviolative of Article 14 of the Constitution.\n<\/p>\n
\t19. If the contract has been entered into without ignoring the procedure
\nwhich can be said to be basic in nature and after an objective consideration of
\ndifferent options available taking into account the interest of the State and
\nthe public, then Court cannot act as an appellate authority by substituting its
\nopinion in respect of selection made for entering into such contract. But, once
\nthe procedure adopted by an authority for purpose of entering into a contract is
\nheld to be against the mandate of Article 14 of the Constitution, the courts
\ncannot ignore such action saying that the authorities concerned must have some
\nlatitude or liberty in contractual matters and any interference by court amounts
\nto encroachment on the exclusive right of the executive to take such decision.\n<\/p>\n
\t28……Public authorities are essentially different from those of private
\npersons. Even while taking decision in respect of commercial transactions a
\npublic authority must be guided by relevant considerations and not by irrelevant
\nones. If such decision is influenced by extraneous considerations which it ought
\nnot to have taken into account the ultimate decision is bound to be vitiated,
\neven if it is established that such decision had been taken without bias….\n<\/p>\n
\t\t7.7. In Food Corpn. of India v. Kamdhenu Cattle Feed Industries,<\/a>
\nreported in 1993 SC 1601, it has been held as follows:-\n<\/p>\n
\t“7. In contractual sphere as in all other State actions, the State and all
\nits instrumentalities have to conform to Article 14 of the Constitution of which
\nnon-arbitrariness is a significant facet. There is no unfettered discretion in
\npublic law: A public authority possesses powers only to use them for public
\ngood. This imposes the duty to act fairly and to adopt a procedure which is
\n‘fairplay in action’. Due observance of this obligation as a part of good
\nadministration raises a reasonable or legitimate expectation in every citizen to
\nbe treated fairly in his interaction with the State and its instrumentalities,
\nwith this element forming a necessary component of the decision-making process
\nin all State actions. To satisfy this requirement of non-arbitrariness in a
\nState action, it is, therefore, necessary to consider and give due weight to the
\nreasonable or legitimate expectations of the persons likely to be affected by
\nthe decision or else that unfairness in the exercise of the power may amount to
\nan abuse or excess of power apart from affecting the bona fides of the decision
\nin a given case. The decision so made would be exposed to challenge on the
\nground of arbitrariness. Rule of law does not completely eliminate discretion in
\nthe exercise of power, as it is unrealistic, but provides for control of its
\nexercise by judicial review.\n<\/p>\n
\t8. The mere reasonable or legitimate expectation of a citizen, in such a
\nsituation, may not by itself be a distinct enforceable right, but failure to
\nconsider and give due weight to it may render the decision arbitrary, and this
\nis how the requirement of due consideration of a legitimate expectation forms
\npart of the principle of non-arbitrariness, a necessary concomitant of the rule
\nof law. Every
\nlegitimate expectation is a relevant factor requiring due consideration in a
\nfair decision-making process. Whether the expectation of the claimant is
\nreasonable or legitimate in the context is a question of fact in each case.
\nWhenever the question arises, it is to be determined not according to the
\nclaimant’s perception but in larger public interest wherein other more important
\nconsiderations may outweigh what would otherwise have been the legitimate
\nexpectation of the claimant. A bona fide decision of the public authority
\nreached in this manner would satisfy the requirement of non-arbitrariness and
\nwithstand judicial scrutiny. The doctrine of legitimate expectation gets
\nassimilated in the rule of law and operates in our legal system in this manner
\nand to this extent.\n<\/p>\n
\t7.8.\tIn LIC of India v. Consumer Education & Research Centre, reported in
\n(1995) 5 SCC 482, it has been held as follows:-\n<\/p>\n
“”27. In the sphere of contractual relations the State, its instrumentality,
\npublic authorities or those whose acts bear insignia of public element, action
\nto public duty or obligation are enjoined to act in a manner i.e. fair, just and
\nequitable, after taking objectively all the relevant options into consideration
\nand in a manner that is reasonable, relevant and germane to effectuate the
\npurpose for public good and in general public interest and it must not take any
\nirrelevant or irrational factors into consideration or appear arbitrary in its
\ndecision. Duty to act fairly is part of fair procedure envisaged under Articles
\n14 and 21. Every activity of the public authority or those under public duty or
\nobligation must be informed by reason and guided by the public interest.
\n………\n<\/p>\n
The purpose of contract law is not simply to create conditions of liability, but
\nalso to respond to the social process of promising.”\n<\/p>\n
\t\t7.9.\t In U.P.Awas Evam Vikas Parishad Vs. Gyan Devi, reported in
\n(1995) 2 SCC 326, the Supreme Court has held that the principle of legitimate
\nexpectation would apply even in cases when a person has no enforceable right, if
\nhe is likely to be affected by an order passed by the public authority.\n<\/p>\n
\t\t7.10. In M.P.Oil Extraction Vs. State of M.P. reported in (1997) 7
\nSCC 592,  it has been held that the doctrine of “legitimate expectation”
\noperates in the domain of public law and in an appropriate case, constitutes a
\nsubstantive and enforeceable right.\n<\/p>\n
\t\t7.11. In Tamil Nadu Shop Municipal Shop Merchants Association and
\netc.  Vs. State of Tamil Nadu and Ors reported in AIR 2000 Mad 393, it has been
\nheld as follows:-\n<\/p>\n
“17. There is another aspect of the matter. The petitioners came to enjoy the
\nright pursuant to a contract. They bid at the auction and became successful
\nbidders pursuant to which they were permitted to occupy the shops or stalls and
\nrun their business. Admittedly, in all these cases, the period for which the bid
\nwas made has ended. The petitioners all claim that they must be granted a
\nfurther period and that they are prepared to pay enhanced rent or licence fee as
\nthe case may be at 15%. The right of the petitioners therefore arises out of a
\ncontract. The right is civil in nature. At best, it is contractual in its
\neffect. Time and again the Apex Court has held that a judjcial review of
\ncontractual obligations or enforcement of contractual obligations cannot be
\npermitted under Article-226. Therefore, the petitioners cannot maintain a claim
\nunder Article 226 for the enforcement of the contractual obligations. It is not
\npossible to accept the contention of the learned counsel for the petitioner that
\nhe can approach the Court under Article 226. The local bodies cannot be
\ncompelled under law to grant leases\/ licences in favour of the petitioners
\nforever.\n<\/p>\n
\t…..\n<\/p>\n
22. The Apex Court has held in the decision reported, in
\nMANU\/SC\/1368\/1997:(1997)8SCC770 (M.C.Metha V. Union of India) that provisions of
\nan Act have to be so construed as to keep individual or a class interest
\nsubordinate to the larger public interest. One has to take into consideration
\nthe larger interest of the people at large or the Society. Public bodies have
\nthe right to put the properties belonging to them in auction and augment their
\nincome and thus deal with it in a manner more advantageous to them. Any
\ndirection not to hold auction or to renew the lease will not only put an
\nunwarranted limit on their right but would work against the larger interest of
\nthe Society……….\n<\/p>\n
 26. The Municipalities or the Panchayats as the case may be, put up buildings
\nin the bus stand or in the parking stands. In some cases, they also put up some
\nshopping complexes. There are stalls in the public markets where the right to
\nexpose goods are leased out. In W. P. Nos. 4904 and 4905 of 2000 the Municipal
\nCouncil is not made a party. The property vests
\nwith the Municipal Council, who are the owners. The Director of Municipal
\nAdministration is but an authority having some powers over the Municipal
\nCouncil. The Director of Municipal Administration cannot become the owner of the
\nproperty, though he may have some right or power to issue directions to the
\nMunicipal Council now and then in that regard. A reading of Sections 260 and 261
\nto which I have already referred to would show that the council may provide
\nplaces for use of public markets and may farm out the same and the control of
\nwhich will be only with the Executive Authority. But surprisingly enough, the
\nMunicipalities have not been made parties. Merely because Director of Municipal
\nAdministration has got a controlling power over the Executive authority of the
\nlocal body, without impleading the concerned Municipalities, the petitioners
\ncannot ask this Court to issue directions.\n<\/p>\n
\t….\n<\/p>\n
33. The decision reported in 1999 Writ LR 155 (V. Chellappa v. Commissioner,
\nTirunelveli Municipal Corporation)<\/a> is to the effect that non-statutory contracts
\nand right touching an immovable property cannot be enforced and Article 226 of
\nthe Constitution and that the petitioners cannot resist the right of the
\nMunicipality to auction and that the Municipality can hold the properties and
\nput it to better use to augment more income in public interest in the manner
\nmost advantageous to it and that any direction not to hold auction or renew the
\nlicence is nothing but putting a limit on such right, which is impermissible in
\nlaw.\n<\/p>\n
\t…..\n<\/p>\n
 There is no provision under the District Municipalities Act which has been
\npointed out
\nthat the rights or lease granted to the appellants were perpetual under the
\nDistrict Municipalities Act. The Municipal Authorities, it has been statutorily
\nprovided by the illustration, may grant for six years i.e., three years and
\nthree years and no more. The argument advanced by the learned counsel for the
\nappellants, if accepted that after the expiry of three years, the lease has lobe
\nextended, it is nothing but a lease perpetuity. Lease in perpetuity or extension
\nor renewal without time limit amounts to lease in perpetuity which is not
\npermissible in law and in terms of the statutory provisions. This is not the
\nintention of the statute and this will create a monopoly in favour of a person
\nwho has once taken the lease in an open auction. This apart it causes a loss,
\nthe local authority, when the property can be auctioned at much higher price and
\nthe appellants arc not debarred from participating in the auction.”\n<\/p>\n
\t50. I cannot agree with this contention. There are number of
\nMunicipalities, town Panchayats and Corporations. They own buildings, stalls
\netc. either located in the bus-stand or in the shandy or in other public places,
\ncart-stands etc. Some of the public bodies have their own shopping complexes.
\nThe situation is peculiar to each local body. There is no uniformity in the
\nsame. One cannot expect all the local bodies to have a uniform practice though
\nit may be desirable to have such uniform practice. The local bodies have to act
\naccording to the exigencies of the time, their set up, the situation they have
\nto face and the circumstances that govern them. It cannot be the same for all
\nthe local bodies. Some local bodies may have certain peculiar problems in that
\nfield. In fact, the learned Senior Counsel Mr. Masilamani at the beginning of
\nhis argument submitted that the local bodies are only like private land owners.
\nIf they can be equated to
\nprivate land owners, then, it has to be equally stated that one private land
\nowner need not, will not and does not act as the other private owner and that
\nthe approaches will be different.\n<\/p>\n
…….\n<\/p>\n
\t51. I am not able to accept the contention that there is any violation of
\nArticle 14 in that regard. There is no discrimination. For every classification
\nis in some degree likely to produce some inequity and mere production of
\ninequity is not an abrogation of Article 14. It is only a reasonable exercise of
\npower by the Local Body. The Government has only the Supervisory power. The
\nGovernment has the Rule making power under the Act and with a view to stream-
\nline the procedure, the Government issues administrative instructions and brings
\nabout amendments to the Rules regarding leases and lincences. Hence. It is not
\npossible to expect an uniform authority. What holds good to a petitioner
\nMunicipality may not hold good to another Municipality. What holds good for
\nlicence relating to a restaurant in a Municipal bus-stand may not hold good when
\napplied to a licence to exposed goods in market. The policy of fixity of tenure
\ncannot be also achieved in such cases. Because, that would defeat the very
\npurpose of public auction. Normally, it is only granted for a period of one year
\nor three years. It cannot be stated that the present policy is not to the
\nbenefit of the people. If certain person with open eyes take properties in a
\npublic auction, knowing fully well that the period of licence or lease is only
\nfor a period of three years and if such persons are to make investments, they
\ncannot turn round later on to say that they have made huge investments and
\ntherefore, on that ground they must be granted further extension of lease. If
\nthat argument is to be accepted, then it will be easy for every one who comes
\ninto the picture at the first instance, make a show of investment and claim that
\nhe has made huge investments and continue to be in the property forever. Rightly
\nor wrongly and knowing fully well about the terms and conditions of the lease,
\nand the period of lease, they have come into the properties. If they are foolish
\nenough to make huge Investments in the hope that they will be able to get
\nfurther extension of lease, they have to blame themselves. They cannot be
\nallowed to take advantage of their own false sense of hope. Nor they can on that
\nground, be allowed to get away with the same.\n<\/p>\n
……\n<\/p>\n
53. The local bodies herein are not claiming any higher right. All the parties
\nhave entered into a contract which had come into existence after they became the
\nhighest bidders in the auction. Therefore, the petitioners are bound by the
\ncontracts. Therefore. when parties are governed by contracts, the parties can
\nonly resort to terms and conditions of the lease to ventilate their grievance or
\nseek redressal. They cannot resort to a procedure under Article 226. Contractual
\nobligations can never be enforced through Article 226. Further, the local bodies
\nare not seeking to exercise any superior right or power. The leases\/licenses
\nhave expired only by efflux of time. They want to reauction the properties. It
\nis the common and ordinary right of the owner of the property to enjoy the
\nproperty in the manner he wants. If the property is leased out for a particular
\nperiod, the owner is entitled to reclaim the property after the expiry of the
\nperiod and take further steps with regard to the same. Therefore, this is not a
\ncase where it can be stated that the local bodies are claiming any higher right.
\nBut what they want to exercise is only their rights under the terms and
\nconditions of the lease. The contention that there cannot be two different
\nstandards with regard to normal activity is, in my opinion, not well founded.
\nFor there are no different standards at all obtaining. If we term the action of
\nthe local bodies in auctioning out the rights by way of public auction as a
\nnormal commercial activity, then, they are entitled to do so. Such a lease
\ncannot be compared to a lease under the Tamil Nadu Buildings (Lease and Rent
\nControl) Act. The contention of the learned counsel based upon the view of the
\nmatter from the angle of the Tamil Nadu Buildings (Lease and Rent Control) Act
\nis only a misplaced argument. They are two different fields, where different
\nreasons govern the matter. It may be that the landlord under the Tamil Nadu
\nBuildings (Lease and Rent Control) Act cannot claim more rent than that fixed
\nunless he resorts to the provisions of the Act. It is also true that since the
\nproperty is leased out, the tenant can hold the property forever unless the
\nlandlord claims that he requires the premises bona fide or the tenant commits
\ndefault in payment of rent. The petitioners counsel cannot draw an analogy from
\nthat to contend that since the property is leased out to the petitioners, they
\ncan continue to be in possession of the property for indefinite period of time
\nand that they cannot be asked to pay over and above than what they were paying
\nprior to that. The two enactments operate in two different fields. They cannot
\nbe mixed up. Nor an inspiration can be drawn to contend that there is any
\ndiscrimination and different norms with regard to lessees and licencees of the
\nlocal bodies.”\n<\/p>\n
\t7.12.\tIn T.Ramaraju  Vs. The State of Tamil Nadu and others, reported in
\n2005 (2) CTC 741, a Full Bench of this Court has held that encroachments on road
\nmargin, coming under the purview of the municipalities, can be removed only
\nafter following the procedures contained in Chapter IX of the Tamil Nadu
\nDistrict Municipalities Act, 1920, especially, the provisions contained in
\nSections 182 and 183(6) of the Act.  The concerned municipalities, before
\ninitiating steps to remove the encroachments, shall issue notice to the
\nencroachers, in writing, giving them atleast two weeks time to remove the
\nencroachment.  If the encroachers avoid receiving the notice, such notice can be
\neffected by affixture and not by any other means, such as through public
\nannouncement or beating of drums or by general notice in newspapers.\n<\/p>\n
\t\t7.13.  In Kannan and others Vs. The Commissioner, Panruti
\nMunicipality reported in (1998) 1 MLJ 576, it has been held as follows:-\n<\/p>\n
“13. The Municipality has got an absolute power over those properties. The
\nGovernment has only a supervisory power over it. Under the District
\nMunicipalities Act, all its properties absolutely vest in the Municipality. In
\nsuch a case, the Municipality has got absolute power to decide as to how its
\nproperties should be dealt with. In these cases, the Municipality has passed
\nResolution that it apprehends encroachment in its lands and public is also
\nexperiencing great difficulty in view of the location of the bunks. Of course,
\nthe petitioners dispute the above statement of the Municipality. But when a
\npublic body passes a Resolution taking into consideration the interest of the
\npublic, naturally the petitioners cannot claim that they should be permitted to
\ncontinue the shops in the very same place.\n<\/p>\n
\t…….\n<\/p>\n
19. The question of certiorari will never arise in these cases. The Municipality
\nthe owner of the bunks, is justified in issuing the notice for reasons, which it
\nfeels to be justified in terminating the arrangement. The Resolution of the
\nMunicipality is not challenged in any of the writ petitions. The challenge is
\nonly is respect of the notice, as against which no relief could be granted, for,
\nthese notices are issued only as a consequence of the resolution passed by the
\nrespondent-Municipality.”\n<\/p>\n
\t\t7.14. In V.Chellappa and another Vs. Commissioner, Tirunelveli
\nMunicipal Corp., Tirunelveli & another, reported in 1998 (1) CTC 465, it has
\nbeen held as follows:-\n<\/p>\n
“14. These petitions are liable to be dismissed in view of the decision of the
\nSupreme Court in A.I.R. 1989 S.C.1026 and State of Rajasthan v. Bhavani Singh
\nand others, MANU\/SC\/0192\/1992:AIR 1992 SC 1018, wherein it has been held that
\nnon-statutory contracts and right touching an immovable property cannot be
\nenforced under Art. 226 of the Constitution.\n<\/p>\n
15. For these reasons, I hold that the petitioners are not entitled to resist
\nthe right of the respondent to auction, because, such right springs from the
\nvery right of ownership of the property so long as there is no statutory
\nprohibition. It can hold the property and put it to better use to augment more
\nincome in public interest in the manner most advantageous to it. Any direction
\nnot to hold auction or to renew the licences is nothing but putting a limit on
\nsuch right, which is impermissible in law.\n<\/p>\n
16. Therefore, the petitioners being licencees, where their right to collect
\nfees is not affected during the subsistence of the licence period, they have no
\nright to resist the action of the respondents either to bring the property to
\nauction or confirmation of the auction already held or to refuse to renew any
\nsuch licence.”\n<\/p>\n
\t7.15.  In M.Palanisamy and others Vs. The Sriramapuram Town Panchayat
\nthrough its Executive Officer, Sriramapuram, Dindigul reported in 1998 (2) CTC
\n683, it has been held as follows:-\n<\/p>\n
 “While exercising the jurisdiction, this Court has to keep in view the conduct
\nand nature of the right which the petitioners are seeking to enforce and the
\nrelevant circumstances under which they are seeking for a direction to decide
\nwhether the jurisdiction under Article 226 of the Constitution should be
\nexercised or not. It would be travesty of justice to permit jurisdiction under
\nArticle 226 of the Constitution to be involved to perpetuate their occupation of
\npublic property at the cost of public revenue. In such circumstances, the Apex
\nCourt in Sales Tax Officer and Another v. M\/s Shree Durga Mills and<\/a> another,
\n1997 (1) ST 418, has held that the Court will not interfere with any action
\ntaken by the Government in public interest-Public interest must override any
\nconsideration of private loss or gain. This jurisdiction is meant to preserve
\nthe right and not to create a right where the petitioners have no semblance of
\nany right to see renewal. where the properties were put to argument more income
\nfor the benefit of the public, I do not think that the petitioners are entitled
\nto any relief from this Court. Auction of plots is policy decision of the
\nauthority to enable the new persons to enter into the business and to discourage
\nthe monopoly of the old and established method of earning more income, resorting
\nto sub-leases of public property. In such a situation, where the local
\nauthority, after due publication adopted the fairest means of disposal of its
\nproperty by way of lease through public auction and gives an opportunity to
\neveryone to make a bid, cannot be found fault with and if at all, the
\npetitioners thought that they are likely to be affected or affected by auction
\nand causing dislocation of their business, nothing prevented them to participate
\nin the auction and claim the shops, instead, they cannot cling on to a non-
\nexisting right and resort to litigation, prevent the local authority from
\naugmenting more income from its property, earning better revenue for the public
\ngood.”\n<\/p>\n
\t\t8.\tIn the counter affidavit filed on behalf of the third
\nrespondent, the averments and allegations made by the petitioner, in his
\naffidavits filed in support of the Writ Petitions, have been denied.  It has
\nalso been stated that it is false to state that the lease had been granted in
\nfavour of the petitioner’s father, for an extent of 6252.5 Sq.ft, in shop Nos.3
\nand 4, in the Municipal bus stand, at Bodinaickkanur, in the year, 1974. In
\nfact, shop Nos.3 and 4, together, measures to an extent of 1750 Sq.ft only.  The
\nlease granted in favour of the petitioner, in respect of those shops, had
\nexpired, on 31.03.2009.  The petitioner had not produced the ‘no objection
\ncertificate’ from the Fire Service Department, as it is a necessary requirement
\nfor the renewal of the lease in his favour.  Even though the lease had been
\ngranted to the petitioner only for an extent of 1750 Sq.ft, he is running a
\nrestaurant in an extent of 6252.5 Sq.ft, by encroaching upon the property
\nbelonging to Bodinaickkanur Municipality.  The Revenue Divisional Officer,
\nUthamapalayam, had also conducted an enquiry, under Section 133 of the Criminal
\nProcedure Code, 1974, to prevent the petitioner from causing nuisance. However,
\nthe petitioner is running the Hotel in question, on the strength of the interim
\norder of stay granted by this Court, in the miscellaneous petition, in
\nM.P.(MD).No.1 of 2010, filed along with the present Writ Petition.\n<\/p>\n
\t\t9.\tIt has also been stated that the petitioner is not entitled to
\ndemand extension of lease in his favour, in respect of the larger extent of the
\nproperty, contrary to the original lease granted in his favour. Further, the
\nthird respondent municipality is taking steps to demolish the illegal
\nencroachments for the purpose of extension of the municipal bus stand at
\nBodinaickkanur and to provide better facilities to the public using the said bus
\nstand.  As such, the Writ Petitions filed by the petitioner are devoid of merits
\nand therefore, they are liable to be dismissed, with costs.\n<\/p>\n
\t\t10.\tIn view of the averments made in the affidavits filed on
\nbehalf of the parties concerned and in view of the submissions made by the
\nlearned counsels appearing on their behalf, this Court is of the considered view
\nthat the petitioner has not shown sufficient cause or reason to grant the
\nrelief, as prayed for, in the present Writ Petitions.  The petitioner has not
\nbeen in a position to show that he is entitled to the extension of the lease,
\nfor carrying on his business in the municipal bus stand, at Bodinaickkanur. in
\nan extent of 6252.5 Sq.ft.  It is not in dispute that the petitioner had filed a
\nCivil Suit, in  O.S.No.155 of 2009, on the file of the District Munsif Court,
\nBodinaickkanur, praying for a decree of permanent injunction, against the second
\nrespondent.  He had also obtained an order of interim injunction in his favour,
\nin I.A.No.154 of 2009.  While so, it would not be appropriate for this Court to
\ndecide the issues arising for consideration in the said Civil Suit, in the
\npresent Writ Petition, at this stage.  Further, nothing has been shown on behalf
\nof the petitioner to substantiate his claim that the respondents had infringed
\nthe principles of legitimate expectation and promissory estoppel.\n<\/p>\n
\t\t11.\tIn fact, as per the lease agreement, the petitioner had agreed
\nto vacate the premises in question, as and when it was found necessary, by the
\nthird respondent municipality, in public interest. In such circumstances, it is
\nnot open to the petitioner to demand that the lease, which had expired, on
\n31.03.2009, should be extended for a further period of three years, from
\n01.04.2009 to 31.04.2012.  As such, the Writ Petitions are devoid of merits and
\ntherefore, they are liable to be dismissed.  Accordingly, both the  Writ
\nPetitions  are  dismissed.  Consequently, connected miscellaneous petitions are
\nclosed. No costs.  However, it is made clear that it would be open to the
\nconcerned Civil Court to decide the issues arising for its decision, in
\nO.S.No.155 of 2009, on merits and in accordance with law, without being
\ninfluenced by the observations made by this Court, in this order.\n<\/p>\n
ssm<\/p>\n
To\n<\/p>\n
1.The District Collector,
\n  Theni District,
\n  Theni.\n<\/p>\n
2.The Board of Council,
\n  Bodinaickkanur Municipality,
\n  Bodinaickkanur.\n<\/p>\n
3.The Divisional Officer,
\n  Fire Service and Rescue Department,
\n  Theni Division,<\/p>\n
4.The Municipal Commissioner,
\n  Bodinaickkanur Municipality,
\n  Bodinaickkanur,
\n  Theni District.\n<\/p>\n
5.The Station Officer,
\n  Fire Service and Rescue Station,
\n  Bodinaickkanur,
\n  Theni District-625 513.<\/p>\n","protected":false},"excerpt":{"rendered":"
Madras High Court N.Pappa Kannan vs The Collector on 1 October, 2010 BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED: 01\/10\/2010 CORAM THE HON’BLE MR.JUSTICE M.JAICHANDREN W.P.(MD).No.2857 of 2010 & W.P.(MD).No.9063 of 2010 and M.P.(MD).Nos.1 & 2 of 2010 in W.P.(MD).No.2857 of 2010 and M.P.(MD).No.2 of 2010 in W.P(MD).No.9063 of 2010 N.Pappa Kannan .. […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[8,13],"tags":[],"class_list":["post-129034","post","type-post","status-publish","format-standard","hentry","category-high-court","category-madras-high-court"],"yoast_head":"\nN.Pappa Kannan vs The Collector on 1 October, 2010 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/n-pappa-kannan-vs-the-collector-on-1-october-2010\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"N.Pappa Kannan vs The Collector on 1 October, 2010 - 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