{"id":153909,"date":"1972-05-03T00:00:00","date_gmt":"1972-05-02T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/hitkarini-sabha-jabalpur-vs-the-corporation-of-the-city-of-on-3-may-1972"},"modified":"2018-02-08T16:00:40","modified_gmt":"2018-02-08T10:30:40","slug":"hitkarini-sabha-jabalpur-vs-the-corporation-of-the-city-of-on-3-may-1972","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/hitkarini-sabha-jabalpur-vs-the-corporation-of-the-city-of-on-3-may-1972","title":{"rendered":"Hitkarini Sabha, Jabalpur vs The Corporation Of The City Of … on 3 May, 1972"},"content":{"rendered":"
Supreme Court of India<\/div>\n
Hitkarini Sabha, Jabalpur vs The Corporation Of The City Of … on 3 May, 1972<\/div>\n
Equivalent citations: 1972 AIR 2017, \t\t 1973 SCR (1) 495<\/div>\n
Author: A Grover<\/div>\n
Bench: Grover, A.N.<\/div>\n
           PETITIONER:\nHITKARINI SABHA,  JABALPUR\n\n\tVs.\n\nRESPONDENT:\nTHE CORPORATION OF THE CITY OF JABALPUR & OTHERS\n\nDATE OF JUDGMENT03\/05\/1972\n\nBENCH:\nGROVER, A.N.\nBENCH:\nGROVER, A.N.\nHEGDE, K.S.\n\nCITATION:\n 1972 AIR 2017\t\t  1973 SCR  (1) 495\n 1972 SCC  (3) 325\n CITATOR INFO :\n D\t    1991 SC  14\t (7)\n\n\nACT:\nLand\t Acquisition\t Act\t 1894--Apportionment\t  of\ncompensation--Unauthorised lease by Municipal corporation to\nlocal  College-lease  deed Containing  renewal\tclause-Since\nlease  is  ineffective renewal clause cannot be\t taken\tinto\nconsideration\tfor  purpose  of  apportionment-Quantum\t  of\ncompensation-This Court will not interfere when lower courts\nhave taken all factors into consideration.\n\n\n\nHEADNOTE:\nThe Municipal Corporation of Jabalpur purporated to grant  a\nleave of certain land to the appellant Sabha.  According  to\nthe  document  the  period  of\tlease  was  30\tyears.\t The\nappellant  was entitled on the expiry of the lease to,\thave\nthe  same renewed on such terms and conditions as  might  be\nagreed\tbetween\t the parties, The appellant made  a  college\nhostel on the aforesaid land and had also used the  attached\nground\tas playground for students.  A portion of  the\tsaid\nland was sought to be acquired by the State Government under\nthe  Land  Acquisition Act, 1894 for constructing  the\tHome\nScience\t College.  The Collector of Jabbulpur by  his  award\ndated  July  18,  1955 dealt with the claims  filed  by\t the\nappellant  and\tthe Municipal Corporation and  assessed\t the\ncompensation  at  As. \/8\/- per sq. ft.\t Apportionment\twas\nmade  between  the  appellant and  the\tCorporation  on\t the\nfooting\t that the appellant was not merely a tenant at\twill\nas  contended  by the Corporation but was a lessee  for\t the\nterms mentioned in lease.  The appellant and the Corporation\nmade  applications for reference under s. 18(1) of the\tAct.\nThe Additional District Judge held that the price should  be\nAs. \/10\/-  per.\t sq ft. and that the  appellant\t and'  the\nMunicipal  Corporation were entitled to equal  compensation.\nThe Corporation and the appellant filed appeals to the\tHigh\nCourt.\tThe decision of the Addl.  District Judge fixing the\nprice  of the land As. \/10\/- per sq. ft. was affirmed.\t As\nregards\t the dispute regarding apportionment the High  Court\nheld  that  the\t lease\tdeed having  been  exempted  by\t the\nAdministrator  during  the time when the  Corporation  stood\nsuperseded was ineffective to convey the leasehold  interest\nto  the\t appellant.  However, the appellant was\t paying\t the\nrent  which  had  been\taccepted for  a\t long  time  by\t the\nCorporation.   there  was  thus a  tenancy  by\t necessary\nimplication.  The High Court further held that the lease was\nto continue for the period of 30 years mentioned in the deed\nbut  there  was\t no valid contract for\trenewal\t of  least--\nbecause the clause relating to that was vague and uncertain.\nThe  apportionment  was made on acturial basis\tbetween\t the\nappellant and the Corporation in the ratio of 1038 : 962.In\nappeal before the Court the   quest-ions relating to quantum\nof compensation and the\t  apportionment between\t\t the\nappellant and the Corporationfell for consideration.\nHELD  : (1) No lease could  be\tspelt out of the deed  dated\nAugust\t31,   1940 for a\t period of     30      years\ncontaining\t the\t renewal clause.  If th officer\t who\nexecuted  the  lease  deed had no power\t to  lease  out\t the\nproperty in question the grant of the lease was wholly\tnull\nand void.  It is true that by the acceptance of rent from\nthe appellant the relationship of landlord and tennant\tcame\ninto xistence. But that did not show that a lease deed for a\nperiod\tof  30\tyears with a renewal clause  had  come\tinto\nexistence. [497E]\nSince  the  lease deed was ineffective the  lease  could  be\nunder  the  provisions of section 106- of the  'transfer  of\n'Pro@y Act, only from. mouth\n494\nto month because the immovable property had  not been leased\nout for agricultural or manufacturing purpose in which\tcase\nit  would  have\t been from year\t 'Lo  year.   Therefore\t the\n:contention that the renewal clause was effective and should\nhave   been  taken  into  consideration\t while\tmaking\t the\napportionment  between\tthe appellant  and  the\t Corporation\ncould not be accepted. (The question whether the High  Court\nwas  right in holding that the period of lease was 30  years\nwas  not  gone\tinto because the Corporation  had  filed  no\nappeal against that portion of the decision. [497H]\nDagdulal  v. Municipal Committee, Burhar,  (19'60)  M.P.L.J.\n627 and H.     V. Ranan v. G. N. Gopat & Ors.  A. I. R. 1961\nMys. 29, referred to.\n(2)  The value which was fixed by the Addl.  District  Judge\nand the High Court was fixed by reference to sales of  plots\nof  comparable\tnature.\t There was no doubt  that  the\tHigh\nCourt had taken all the factors into consideration while  as\nessing\tthe  value and there was no reason to  interfere  in\nthis regard. [499A-C]\nRaja   Vyigheria  Narayana  Gajapatiraju  v..  The   Revenue\nDivisional Officer Vizagapatam, 66 I.A. 104, referred to.\n\n\n\nJUDGMENT:\n<\/pre>\n
CIVIL APPELLATE JURISDICTION: Civil Appeals Nos. 702 and
\n703 of 1967.\n<\/p>\n
Appeals from the judgment and order dated September 28, 1960
\nof  the\t Madhya Pradesh High Court in Misc.   First  Appeals
\nNos. 12 and 16 of 1958.\n<\/p>\n
M.   C. Chagla, Rameshwar Nath and Swaranjit Ahuja, for\t the
\nappellant (in both the appeals).\n<\/p>\n
S.   T. Desai and D. N. Mukherjee, for respondent No. 1\t (in
\nboth the appeals).\n<\/p>\n
I.   N.\t Shroff, for respondents Nos. 2 and 3 (in  C.A.\t No.
\n703 of 1967) and respondent No. 2 (in C.A. No. 702 of 1967).
\nThe Judgment of the Court was delivered by
\nGrover,\t J.  These appeals which have been brought  by\tcer-
\ntificates from a common judgment of the Madhya Pradesh\tHigh
\nCourt arise out of certain acquisition proceedings.
\nThe  facts  may\t be stated.  Plots Nos.\t 670,  671  and\t 735
\nsituate\t in  Madan  Mahal  Extension  area,  Jabalpur\twere
\nacquired by the State Government under the Land\t Acquisition
\nAct 1894, hereinafter called the ‘Act’, for constructing the
\nHome  Science  College.\t  In  the  present  appeals  we\t are
\nconcerned  mainly with Plot No. 670.  On August 31, 1940,  a
\ndeed  of lease had been executed on behalf of the  Municipal
\nCorporation  granting  a  lease\t free  of  premium  to\t the
\nHitkarini Sabha, Jabalpur, which is the appellant before us.
\nThe  laese was in respect of 10 Acres of  land\tcomprising
\nPlot No. 670 and another strip of land measuring 0.621 Acres
\nas described in the deed and delineated in the plan  annexed
\nthereto.   The\tperiod\tof the lease was 30  years  and\t the
\npurpose\t for which the land was to be used was for  locating
\nand running the Hitkarini City College.\t Amongst other terms
\nand  conditions the, appellant was to pay a yearly  rent  of
\nRs. .5 \/ , for 1 0 acres and Re. 1 \/  for the other  strip
\nof  land  besides,  paying, and discharging  all  rates\t and
\ntaxes-etc.   The appellant, on the expiry of the lease,\t was
\nentitled
\n\t\t\t    495<\/span>
\nto  have the same renewed on-, such terms and conditions  as
\nmight  be  agreed between the parties.\t The  appellant\t had
\nbuilt  a, college hostel on the aforesaid land and had\talso
\nused the attached ground as playground for students.
\nThe Collector of Jabalpur, by his award dated July 18,\t1955
\ndealt  with  the  claims  filed by  the\t appellant  and\t the
\nMunicipal   Corporation\t and  after  disposing\tof   certain
\npreliminary objections he assessed the compensation for\t the
\nlands  in  all\tthe  three  plots  at  As.0\/8\/-per  sq.\t ft.
\nAccording  to the Collector the appellant was not  merely  a
\nlessee or tenant-at-will as contended by the Corporation but
\nwas a lessee for the term mentioned in the lease-deed  dated
\nAugust\t31, 1940, the lease having been made for a  specific
\npurpose,  i.e. for locating and running a City College.\t  As
\nregards Plot No. 670 the apportionment was made between\t the
\nappellant
\nThe appellant and the Corporation were dissatisfied with the
\naward  of  the Collector.  Applications for  reference\twere
\nmade  under s. 18 (1) of the Act.  The\tAdditional  District
\nJudge  held that the price should be 10 As. per sq. ft.\t and
\nthat  the  appellant  and  the\tMunicipal  Corporation\twere
\nentitled  to  equal  compensation for  plot  No.  670.\t The
\nCorporation  and  the appellant filed appeals  to  the\tHigh
\nCourt.\t The  decision\tof the\tAdditional  District  Judge,
\nfixing\tthe price of the land at As. 0\/8\/- per sq.  ft.\t was
\naffirmed.   As regards the dispute  regarding  apportionment
\nthe  High  Court held, following a decision  of\t a  Division
\nBench of the same court in Dagdulal v. Municipal  Committee,
\nBurhar(1),  that the lease deed having been executed by\t the
\nAdministrator  during  the time when the  Corporation  stood
\nsuperseded was ineffective to convey the lease hold interest
\nto  the appellant.  However, the appellant had\tbeen  paving
\nrefit  at the stipulated rate which had been accepted for  a
\nlong  time by the Corporation.\tIt amounted,  therefore,  to
\nthe  creation of a tenancy by necessary implication and\t the
\nrelationship of landlord and tenant came into existence.  On
\nthe character of tenancy, whether it should be deemed to  be
\nfrom year to year or whether it should be on terms contained
\nin  the\t lease deed, the High Court held  that\tthe  tenancy
\ncontinued  on  the terms contained in the lease\t deed.\t The
\nHigh Court then proceeded to say :-\n<\/p>\n
“The lease deed in this case was executed on 31- 8 1940 and
\nwas  for  a period of thirty years.  It\t was,  therefore  to
\nremain\tin  force  for\t15 years  more\tafter  the  date  of
\nacquisition.   There  is  a renewal clause  which  has\tbeen
\nalready\t quoted above.\tThe lessee is entitled\tfor  renewal
\n“on  such terms and conditions as, may be agreed to  between
\nthe parties”.  It appears to. us that the clause
\n(1)  1960 M. P. L. J. 627
\n496<\/span>
\nis  uncertain and  vague and does not form a valid  contract
\nfor  renewal  of  the lease.  Normally\tin  a  covenant\t for
\nrenewal there is  an express agreement that the lease  would
\n\t      be continued on the same terms and  conditions
\n\t      subject to a reservation that the rent way  be
\n\t      enhanced under certain circumstances.  In\t the
\n\t      instant,\tcase, ill the terms  and  conditions
\n\t      have  been  left to the agreement\t of  patties
\n\t      which  may not take place at all.\t Although  a
\n\t      renewal  is contemplated no terms on which  it
\n\t      can  be  granted have been fixed\tbetween\t the
\n\t      parties.\t Under\tsection\t 29  of\t the  Indian
\n\t      Contract\t Act  such  a  contract\t cannot\t  be
\n\t      enforced.,  It has been held in  Ramaswami  v.
\n\t      Rjajagopala (I.L.R. I I Mad. 260) that a lease
\n\t      whereby  a tenant agreed to pay whatever\trent
\n\t      the   Landlord   might  fix   was\t  void\t for
\n\t      uncertainty”.\n<\/p>\n
The  apportionment  was made on acturial basis\tbetween\t the
\nappellant and the Corporation in the ratio of 1038 : 962.
\nBefore\tus two matters have been sought to be  raised.\t One
\none  relates to the quantum of compensation awarded  by\t the
\nlearned\t Additional  District  Judge and the  other  to\t the
\napportionment between the appellant and the Corporation.  We
\nshall  first  deal with apportionment.\tIt has\tbeen  argued
\nthat  since  the  High\tCourt  had  held  that\tthe  tenancy
\ncontinued  on the terms contained in the lease deed  benefit
\nshould have been given of the renewal clause also.  The High
\nCourt had taken the view that that clause was uncertain\t and
\nvague  and did not form a valid contract for the renewal  of
\nthe lease.  Our attention has been invited to a judgment  of
\nthe  Mysore  High  Court  in H. V. Rajan  v.  C.  N.Gopal  &
\nOthers.<\/a>(1) There the relevant portion of the renewal  clause
\nwas “lessee shall have the option of five years but  subject
\nonly to such terms and conditions as may be mutually  agreed
\nupon”.\t It was observed that ordinarily the renewal  clause
\nin  a lease deed was an important term of the agreement\t and
\nthe  courts would be reluctant to ignore that clause on\t the
\nground that it was vague unless on a reasonable construction
\nno  meaning could be attached to it.  An agreement to  renew
\nthe  lease, without more, must be deemed to be an  agreement
\nto  renew  as per the original terms.  Even if\tthe  renewal
\nprovided was dependent on the agreement between the  parties
\nthe  clause merely provided for an agreement  on  reasonable
\nterms.\tIf the parties could not agree as to those terms the
\ncourts could step in.\n<\/p>\n
In  our judgment it is altogether unnecessary to decide\t the
\ntrue scope and effect of the renewal clause contained in the
\ndeed executed on August 31, 1940.  At the time the lease was
\nexecuted
\n(1) A.I.R. 1961 Mys. 29.\n<\/p>\n
497<\/span><\/p>\n
there used to be a Municipal Committee in Jabalpur Aparently
\nit became a Corporation later.\tThe Committee was superseded
\nin-Charge of the Committee Jabalpur as also Secretary of the
\nMunicipal  Committee had signed the lease on behalf of\tthat
\nCommittee.  In the decision of the Madhya      Pradesh\tHigh
\nCourt in Dagdulal’s(1) case the view had been expressed that
\nso  long  as Municipal Committee was not  reconstituted\t the
\nownership of the property stood transferred by operation  of
\nlaw to the State Government and therefore the  Administrator
\nhad  no\t power\twhatsoever to sell the\tproperty  which\t had
\nvested in the Government.  The Additional District Judge had
\nobserved that the lease deed had been executed in  pursuance
\nof  a  resolution  which  had already  been  passed  by\t the
\nMunicipal Committee.  The High Court, however, found on\t the
\nevidence produced before the Additional District Judge\tthat
\nthe  final resolution passed by the Municipal Committee\t was
\nonly  for  the\tgrunt of a license and not a  lease  to\t the
\nappellant.   The deed of lease, therefore, was, held  to  be
\nineffective  for  conveying any lease-hold interest  to\t it.
\nBut  still the High Court held that the tenancy was to\tlast
\nfor a period of thirty years.\n<\/p>\n
We  are wholly unable to comprehend how any lease  could  be
\nspelt out of the deed dated August 31, 1940 for a period  of
\n30  years  containing the renewal clause which\thas  already
\nbeen mentioned.\t If the officer who executed the lease\tdeed
\nhad no power to lease out the property in question the grant
\nof  the lease was wholly null and void.\t It is true that  by
\nacceptance  of the rent from the appellant the\trelationship
\nof  landlord  and  tenant came into  existence\tbetween\t the
\nparties\t but Mr. Chagla for the appellant has not been\table
\nto show how a lease for a period of 30 years together with a
\nrenewal clause could be held to have been created or to have
\ncome  into existence.  It may be mentioned that we  are\t not
\nconcerned with the period of 30 years which has already been
\ntaken into consideration by the High Court because no appeal
\nhas  beep filed on that point by the Corporation.  The\tonly
\nmatter\twhich  requires determination is  whether  the\tHigh
\nCourt, while deciding the question of apportionment,  should
\nhave given due affect to the renewal clause.  In our opinion
\nthe  High Court could riot have done so.  If the  so  called
\ndeed  of lease dated August 31, 1940 was wholly\t ineffective
\nand  void for the purpose of demising the land for a  period
\nof  30\tyears one could only look at the provisions  of\t the
\nTransfer of Property Act for determining the term for  which
\nthe  tenancy came into existence.  Under s. 106 of that\t Act
\nthe ,tenancy, in the present case, could be only from  month
\nto month because the immovable property had not been  leased
\nout
\n(1)   (1960) M..P.L.J. 627.\n<\/p>\n
498<\/span><\/p>\n
for agricultural or manufacturing purpose in which case\t the
\nlease  would have been from year to year.  We are  therefore
\nunable\tto accede to the contention that the renewal  clause
\nin  the lease deed dated August 31, 1940 was  effective\t and
\nshould\thave been taken into consideration while making\t the
\napportionment between the appellant and the Corporation.
\nThe  next  question relating to quantum can be\tdisposed  of
\nshortly.   The\tsole  criticism of Mr. Chagla  is  that\t the
\npotential  value of the plot in question was not taken\tinto
\nconsideration.\t  It  is  true,\t as  pointed  out  in\tRaja
\nVyrigherla  Marayana Gajapatiraju v. The Revenue  Divisional
\nOfficer\t Vizagapatam(1)\t that where the land  to  be  valued
\npossesses  some\t unusual or unique features as\tregards\t its
\nposition  or  its potentialities the court  determining\t the
\nmarket\tvalue will have to ascertain as best as it can\tfrom
\nthe  materials\tbefore\tit  what  a  willing  vendor   might
\nreasonably expect to obtain from a willing purchaser for the
\nland  in that particular position and with those  particular
\npotentialities.\t  It has been urged that Plot No. 670 had  a
\nspecial situation or position in view of its size, locality,
\nnearness  to  business centre and the Madan  Mahal  Station.
\nBut  the  value which was fixed by the\tAdditional  District
\nJudge and the High Court was fixed by reference to sales  of
\nplots  of comparable nature.  The following portion  of\t the
\njudgment  of the High Court shows how the matter  was  dealt
\nwith
\n“We  may observe  that the two witnesses relied upon by\t the
\n\t      appellants  purchased small plots at the\trate
\n\t      of  Re.  1\/- per sq. ft.\tAs the\tmap  of\t the
\n\t      Wright   Town  Madan  Mahal   Extension\tarea
\n\t      produced\tby the Corporation before us  shows,
\n\t      these  plots are in a fully developed lay\t out
\n\t      having  roads and drains round about.  We\t had
\n\t      asked  the Corporation to calculate  how\tmuch
\n\t      area  out\t of  the  acquired  sites  would  be
\n\t      required to be left open for roads and  drains
\n\t      and they have calculated that about 70,000 sq.
\n\t      ft.  would have to be left open for this\tpur-
\n\t      pose.   Obviously, therefore, it is  only\t the
\n\t      remaining\t plot  which  would  have  value  as
\n\t      building sites.  Besides leaving so much\tarea
\n\t      open,  costs  will  have\tto  be\tincurred  in
\n\t      developing the roads, and drains for which the
\n\t      Corporation  has estimated the cost to be\t Rs.
\n\t      8,500\/-.\t Considering all these\tfactors\t and
\n\t      also calculating the built up area in the\t lay
\n\t      outs  surroundings the acquired land, we\tfind
\n\t      that  it is only eighty per cent of  the\tland
\n\t      which can be sold as building site.\n<\/p>\n
On these calculations if the average price of the plots sold
\nin the locality is taken to be \/12\/- per sq. ft. the
\n(1)66 I.A. 104.\n<\/p>\n
499<\/span><\/p>\n
overall price of the acquired land without roads and  drains
\nwould work out to a little less than \/ 9\/  per sq. ft.\tTo
\nput the matter, in a different way, the value of \/ 10\/\tper
\nsq.  ft. found by the Additional Judge would work out  to  a
\nlittle over \/12\/- per sq. ft., if only the area which could
\nbe  built  upon\t is considered saleable\t as  building  site.
\nWe,therefore, find that the price at-\/10\/per sq. ft. allowed
\nby  the Additional District judge, is not  unreasonable;  if
\nanything it errs on the generous side”.\n<\/p>\n
We have no manner of doubt that the High Court had taken all
\nthe factors into consideration while assessing the value.
\nIn  the\t result the appeals fail and are  dismissed.   There
\nwill be no order as to costs.\n<\/p>\n
Appeals dismissed.\n<\/p>\n
G.C.\n<\/p>\n
500<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India Hitkarini Sabha, Jabalpur vs The Corporation Of The City Of … on 3 May, 1972 Equivalent citations: 1972 AIR 2017, 1973 SCR (1) 495 Author: A Grover Bench: Grover, A.N. PETITIONER: HITKARINI SABHA, JABALPUR Vs. RESPONDENT: THE CORPORATION OF THE CITY OF JABALPUR & OTHERS DATE OF JUDGMENT03\/05\/1972 BENCH: GROVER, A.N. […]<\/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":[30],"tags":[],"class_list":["post-153909","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nHitkarini Sabha, Jabalpur vs The Corporation Of The City Of ... on 3 May, 1972 - 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\/hitkarini-sabha-jabalpur-vs-the-corporation-of-the-city-of-on-3-may-1972\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Hitkarini Sabha, Jabalpur vs The Corporation Of The City Of ... on 3 May, 1972 - 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