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Yousuf Andcompany, Rep. by Its Partner Vs. the Government Ofandhra Pradesh, Rep. B - Court Judgment

LegalCrystal Citation
CourtAndhra Pradesh High Court
Decided On
Judge
AppellantYousuf Andcompany, Rep. by Its Partner
RespondentThe Government Ofandhra Pradesh, Rep. B
Excerpt:
the hon'ble sri justice m.s. ramachandra rao w.p. no.12615 of 201.06-06-2013 yousuf and company, rep. by its partner sri mohd. mehamood, hyderabad....appellant the government of andhra pradesh, rep. by its principal secretary,secretariat, hydbad.,and another....respondents senior counsel for petitioner:sri vedula venkata ramana, appearing for sri k.chidambaram, counsel. counsel for respondents:g.p. for industries and commerce and additional advocate general. head note: cases referred 1 (1994) 3 scc 56.par”2. air 198.sc 136.para 22 an”3. (1999) 5 scc 59.4 (2012) 2 scc 48.5 (2012) 4 scc 46.6 air 196.sc 93.(1) 7 air 197.sc 180.8 (2010) 6 scc 49.9 air 195.sc 32.at para.7 10 air 199.sc 70.at para.7 11(1998) 8 scc 28.at para.28 12 (2006) 2 scc 74.13 (1976) 1 scc 90.14 air 198.sc 23.15.....
Judgment:

THE HON'BLE SRI JUSTICE M.S. RAMACHANDRA RAO W.P. No.12615 OF 201.06-06-2013 Yousuf and Company, rep. by its Partner Sri Mohd. Mehamood, Hyderabad....APPELLANT The Government of Andhra Pradesh, rep. by its Principal Secretary,Secretariat, Hydbad.,and another....RESPONDENTS Senior Counsel for Petitioner:Sri Vedula Venkata Ramana, appearing for Sri K.Chidambaram, Counsel. Counsel for Respondents:G.P. for Industries and Commerce and Additional Advocate General. HEAD NOTE: Cases referred 1 (1994) 3 SCC 56.Par”

2. AIR 198.SC 136.Para 22 an”

3. (1999) 5 SCC 59.4 (2012) 2 SCC 48.5 (2012) 4 SCC 46.6 AIR 196.SC 93.(1) 7 AIR 197.SC 180.8 (2010) 6 SCC 49.9 AIR 195.SC 32.at Para.7 10 AIR 199.SC 70.at Para.7 11(1998) 8 SCC 28.at Para.28 12 (2006) 2 SCC 74.13 (1976) 1 SCC 90.14 AIR 198.SC 23.15 (2004) 4 SCC 31.16 (2012) 4 SCC 65.17 (1848) 12 Q.B”

18. 1997) 8 SCC 52.19 (2011) 12 SCC 41.20 AIR 195.SC 73.21 AIR 195.SC 94.ORDER : This writ petition is filed to call for records pertaining to order dt.26.03.2010 of 1st respondent in letter No.3981/IF-Cell/A1/2008-20, confirming the order dt.16.06.2007 of 2nd respondent in proceeding No.13/1/2004/0035/FD, to quash the same by issuing a Writ of Certiorari, consequently direct 1st respondent to grant a fresh lease/convert leasehold rights of petitioner in plot Nos.14/1 and 24/2 of Azamabad Industrial Area, Musheerabad, Hyderabad into freehold and restore possession of the said plots to petitioner to enable it to carry on industrial activity therein. THE FACTS 2 The petitioner is a partnership firm incorporated with the object of conducting industry in Dyeing and Printing of Cloth and allied activities. In 1936, the then Hyderabad Government had conducted sale of plots for industrial purpose in Azamabad Industrial Area, Hyderabad. The petitioner responded to the same and purchased plot Nos.14/1 and 24/2 totally admeasuring Ac.2.366 gts. therein on payment of consideration of Rs.4,732/- on 05.03.1943. Although petitioner was given possession of the said plots, no registered sale deed was executed in it's favour. As the petitioner was in possession of the said plots, in 1965 it approached the 1st respondent and sought registration of the sale deeds for the said plots. But 1st respondent executed a registered lease deed dt.01.09.1965 with the petitioner for a tenure of 99 years on yearly rent of Rs.50.70ps. in respect of the said plots.

3. Subsequently, 1st respondent issued show cause notice dt.17.12.1984 proposing to cancel the lease granted to petitioner on the ground that it had violated certain terms and conditions of the registered lease. The petitioner submitted explanation to the said show cause notice. Vide G.O.Ms.No.89, dt.18.02.1985, the 1st respondent terminated lease of petitioner on the ground that it had contravened certain terms and conditions of the lease deed.

4. Aggrieved by the termination of the lease, petitioner instituted a suit O.S.No.209 of 1985 on the file of the II Addl. Judge, City Civil Court, Hyderabad to declare G.O.Ms.No.89, dt.18.02.1985 as void, invalid, without jurisdiction, illegal, arbitrary and not binding on it and for a consequential permanent injunction restraining the respondents from interfering, dispossessing, disturbing, or in any way causing interference with the enjoyment of the above property during the subsistence of the lease period of 99 years as contemplated in the lease deed. By judgment and decree dt.15.04.1986, the said suit was decreed with a rider restraining the petitioner from carrying any other activity other than dyeing and printing.

5. Aggrieved thereby, 1st respondent filed C.C.C.A.No.118 of 1986 in the High Court of Andhra Pradesh. By judgment and decree dt.17.01.2000, the C.C.C.A.No.118 of 1986 was dismissed for non-prosecution.

6. While the said appeal was pending, the State of Andhra Pradesh enacted the Azamabad Industrial Area (Termination and Regulation of Leases) Act, 1992 (for short, 'Act 15 of 1992'). By virtue of operation of this Act, all the existing leases were terminated on the appointed date of 03.06.1992 [Section 3(1)]. Sub- section (h) of Section 2 thereof defined the term "person in occupation" as including a lessee, sub-lessee or any person who is in occupation of the demised plot under an arrangement with the erstwhile Nizam's Government or the erstwhile Government of Hyderabad or the Government of Andhra Pradesh or any other person who has been indicated into the demised plot. On the termination of the lease, sub-section (1) of Section 4 of the said Act enabled the person in occupation to apply for fresh lease in the manner prescribed at his option. On receipt of such application, sub-section (2) of Section 4 enabled the competent authority specified under the said Act, to grant a fresh lease in accordance with such terms and conditions as may be prescribed where he is satisfied that the applicant is not guilty of violation of any conditions of the lease, or to refuse to grant a fresh lease for reasons to be recorded in writing. Proviso to sub-section (2) of Section 4 stated that where the person in occupation of the demised plot (the lease of which stood terminated under the Act) was actually using it for industrial purpose and was not otherwise guilty of violation of any conditions of lease, his application for fresh lease shall not be rejected and he shall be granted a fresh lease on such terms and conditions as may be prescribed. Sub-section (5) thereof stated that where the lease or other arrangements with regard to a demised plot stood terminated under sub-section (1) of Section 3 and where no fresh lease has been granted under sub-section (4), the person in occupation of such demised plot shall vacate the same and deliver possession thereof to the competent authority within 30 days from the date of receipt of orders refusing to grant a fresh lease. Under sub-section (1) of Section 6 in the event of failure or refusal to vacate and deliver vacant possession of demised plot under Section 5, the competent authority would serve an order of eviction in the manner prescribed on the person in occupation of the said plot requiring him to vacate and deliver possession thereof within such time as may be specified in such order. Under sub-section (2) of Section 6, if the person in occupation of demised plot fails or refuses to vacate it within the time specified in the order under sub-section (1), the competent authority is entitled to take possession of it from the person in occupation and where any such competent authority is resisted in the exercise of such power or discharge of such duty, he could take assistance of the police. Section 11 provided for payment of solatium to persons in occupation whose leases or other arrangements stood terminated under sub-section (1) of Section 3. Section 20 directed that the provisions of the Act and the Rules made thereunder shall have an effect, notwithstanding inconsistent therewith in any other law for the time being in force, or any custom, usage or agreement, or decree or order of a Court, Tribunal or other authority. Notwithstanding anything in any judgment, decree or order of any Court or other authority Section 23 declared that no suit or other proceeding shall be maintained or continued in any Court or before any authority for the continuance of the lease, sub-lease or other arrangement or for the lessee, sub-lessee or person in occupation staying on the demised plot and all such proceeding shall abate; and no Court shall enforce any decree or order directing the continuance of the lease, sub-lease or other arrangement to be in occupation of the demised plot. These are some of the salient features of the Act 15 of 1992.

7. Thereafter, vide G.O.Ms.No.223 Industries and Commerce (F-Cell) dt.11.06.1993, 1st respondent terminated the leasehold rights granted to petitioner with immediate effect and directed that the above plots be resumed to the Government custody. It held that the lease was granted in petitioner's favour for 99 years commencing from 10.03.1943 with a specific condition for establishing and carrying dyeing and printing industry in the leasehold land, though the petitioner had taken possession of the land on 10.03.1943, it did not set up any industry for the purpose for which the lease was granted and it resorted to sub-leasing to small industries such as M/s.Navaneetha Oil Industries, M/s.National Engineering Service and M/s.Vaneskaran Industries, without any approval from the 1st respondent, under the guise of partnership deeds which were in reality nothing but sub-leases. It was also held that petitioner had entered into a partnership deed dt.06.07.1984 with Sri A.P. Agarwal and four others in the name and style of M/s.A.P. Agro Industries, valued the leasehold rights including the leasehold property of Rs.4.00 lakhs and transferred the same to the said firm and it had thus divested itself of the control and possession of the demised premises thereby effecting absolute transfer of interest in favour of M/s.A.P. Agro Industries. On 12.06.1993, the 1st respondent also took possession of the demised land from the petitioner.

8. Challenging the above order, petitioner filed W.P.No.7696 of 1993 in the High Court. By order dt.08.07.1993, the said writ petition was dismissed as not maintainable on the ground that disputed questions of fact relating to setting up of dyeing and printing industry by the petitioner and taking of possession by the 1st respondent were sought to be got decided therein.

9. Challenging the same, the petitioner filed W.A.No.741 of 1993. This writ appeal was heard along with W.P.No.12180 of 1994 and batch where the constitutional validity of the above Act was challenged by some industries which were similarly placed like the petitioner.

10. By order dt.18.08.1994 in WP.12180/1994 and batch including W.A.741/1993, the High Court upheld the constitutional validity of the Act 15 of 1992. In the W.A.741/1993, it was argued on behalf of the petitioner that under the provisions of the Act, a lessee or a person in occupation is entitled to apply for fresh lease in the prescribed manner under Section 4 to the competent authority and a direction may therefore be issued to the competent authority to consider the application that may be submitted by the petitioner. The Court held that there is no dispute that the impugned order dt.11.06.1993 in G.O.Ms.No.223 was passed by the State Government without reference to the provisions of the Act; on the appointed day i.e., 11.07.1992 all leases or other arrangements made are entered into in respect of a demised plots in Azamabad Industrial Area stand terminated and every such demised plot shall vest in the Government; on the termination of the leases under the Act, the person in occupation has a right to apply for fresh lease in the prescribed manner; that it is the case of the petitioner that it was in occupation of the land on the appointed date i.e., 11.07.1992; and therefore, it is proper and appropriate to permit it to make an application for grant of fresh lease under Section 4 of the Act. If such application is submitted to competent authority within 30 days from the date of judgment, the Court directed the competent authority to consider it on merits and in accordance with the provisions of the Act and the rules made thereunder and pass appropriate orders. The Court stated that the competent authority shall exercise its jurisdiction independently by considering the matter afresh and pending disposal of the application by the competent authority, status quo obtaining as on that day regarding possession of the land shall be maintained.

11. Challenging the order dt.18.08.1994 in W.P.No.12180 of 1994 and batch, the petitioners therein filed Civil Appeal No.8852 of 1994 and batch in the Supreme Court. By order dt.16.04.1996 the Supreme Court dismissed the Civil Appeals recording that the State of Andhra Pradesh undertook not to implement the judgment of the High Court impugned therein; that it's counsel stated that it would not take any action against the industries operating in the industrial area concerned and was proposing to amend the Act; that the proposal had already been placed before the Cabinet; that the counsel for the State Government stated that no action regarding cancellation of the leases etc., against the industries concerned shall be taken under the Act; and therefore the appeal had become infructuous.

12. The petitioner had also filed Civil Appeal No.9169 of 1994 challenging the order passed on 18.08.1994 in their W.A.No.741 of 1993. By order dt.01.08.1996, the Supreme Court disposed of the said appeal on the ground that the State Government would look into the matter afresh in terms of its order dt.16.04.1996 in Civil Appeal No.8852 of 1994 and the proposed amendments to Act 15 of 1992 and that while considering the case of the petitioner for fresh lease, the fact that its earlier lease was cancelled shall not be taken into consideration.

13. After about 2 years, the petitioner filed W.P.No.28746 of 1998 for quashing a Memo No.20795/IF(Cell)/96, dt.21.8.1997, and G.O.Ms.No.223 dt.11.6.1993.

14. While it was pending, the State Government enacted the Azamabad Industrial Area (Termination and Regulation of Leases) (Amendment) Act 2000 (for short, 'Act 1 of 2000') amending Act 15 of 1992. It amended the preamble to the 1992 Act and also directed substitution of Sections 3 and 4 of 1992 Act as under : "3. For sections 3 and 4 of the principal Act, the following shall be substituted, namely: - "Termination of leases:

3. (1)(a) Notwithstanding anything contained in the Indian Contract Act, 1872, the Transfer of Property Act, 1882, or any other law for the time being in force, and the terms and conditions of any lease entered into or other arrangement made with any person in respect of any demised plot either by the erstwhile Nizam's Government or by the erstwhile Government of Hyderabad or by the Government of Andhra Pradesh prior to the appointed date, all those leases, sub-leases or other arrangements made or entered into through a registered deed or otherwise in respect of all demised plots in Azamabad Industrial Area which after due enquiry attract one or more of the ground for cancellation of lease as specified in clause (b) shall stand terminated on the appointed date and thereupon all such leases, sub-leases or any other arrangement whatsoever made by the person in occupation of the demised plot shall stand annulled and every such demised plot shall vest in the Government free from all encumbrances. (b) Notwithstanding anything contained in any other law for the time being in force, the leases of plots or portions shall be cancelled on either all or any of the following grounds namely :- (i) misusing of land for a purpose other than the purpose for which land was allotted including non-user; or (ii) sub-letting or transferring the plots or portions of plots by entering into disguised partnerships and other unauthorised transfer of interest in the plot; or (iii) violation of any terms, conditions or covenant specified in the Lease Deed. Explanation : For the purpose of this Act, where a lessee enters into a partnership, agreement or other arrangement for carrying on any activity whatsoever on the demised plot, then notwithstanding anything in the Indian Partnership Act, 1932, it shall also be deemed to be a violation of the conditions of the lease. (2) Lessees of plots whose leases shall not be cancelled under clause (b) of sub-section (1) shall be entitled to a grant of fresh lease with effect from the appointed date and renewal thereof from time to time on such terms and conditions as may be prescribed by the Government. (3) The Lessees specified in sub-section (2) may, in lieu of renewal of lease, opt for free-hold rights in respect of the demised plots of land by paying a price equivalent to 75% of the market value as specified for the area in Market value Guidelines under section 47(a) of the Indian Stamps Act, 1899. (4) Upon the termination of the leases or other arrangement in respect of the plot under sub-section (1) the rights and liabilities as between the parties to the lease or other arrangement in respect of plot shall cease and determine, but any amount due to the Government from the aforesaid person under the lease or other arrangement so terminated shall be recovered as an arrear of land revenue. 4.(1) On termination of lease or other arrangements made under clause (a) of sub-section (1) of section 3, a person in occupation and running an industry on the appointed date may apply for a fresh lease in the manner prescribed. (2) On receipt of an application under sub-section (1), the Competent Authority, may where he is satisfied that the applicant has actually been using the demised plot for industrial purpose, and he deserves grant of lease, shall grant a lease on such terms and conditions as may be prescribed." 15. Taking note of the amendments made to Act 15 of 1992 by Act 1 of 2000, the W.P.28746 of 1998 was dismissed directing the petitioner to make a fresh application for grant of fresh lease in terms of Section 4 of the Act in terms of the amended provisions of the Act. On 12.9.2002, the petitioner made a representation to 2nd respondent seeking grant of fresh lease/free hold rights in respect of plots granted on lease to it under the registered lease deed dt.1.9.1965.

16. Vide G.O.Ms.No.367, Industries and Commerce (IF.Cell) Department dt.23.12.2003, the State Government cancelled the G.O.Ms.No.223 dt.11.6.1993 and directed extension of "the lease fresh hold rights (sic) of the remaining area to the petitioner except to the extent under occupation of SSI Units." It also directed the 2nd respondent-Commissioner of Industries, Hyderabad to verify the existing buildings structure which were constructed in plot no.14/1 and 24/2 in the Industrial Area Azamabad as per the existing sanction plan which are occupied by the SSI units in the premises, to verify the said partnerships lease agreements entered into with SSI units in the premises and decide to take further action in the matter as per law.

17. The petitioner filed W.P.No.20488 of 2004 in this Court questioning the inaction of the respondents in not implementing G.O.Ms.No.367 dt.23.12.2003 and not passing on the benefits there under to the petitioner and sought a direction to respondents to allow all benefits to it which emanated from the said G.O. By order dt.10.6.2005 the said writ petition was disposed of by a learned single Judge of this Court with a direction to the respondents to reconsider the request of the petitioner under it's application dt.16.3.2004 for grant of freehold rights in terms of G.O.Ms.No.367 dt.23.12.2003, without insisting on production of the documents specified in the 2nd respondent's letter dt.26.5.2004 (which required filing of documents to prove that petitioner was running an industry on 17.2.2000) and to pass appropriate orders in accordance with law within a period of four weeks from the date of receipt of the order.

18. Aggrieved thereby, respondents 1 and 2 filed Writ Appeal No.1632 of 2005. By its order dt.12.3.2007, the said Writ Appeal was allowed and the order dt.10.6.2005 passed in Writ Petition No.20488 of 2004 was set aside. The Division Bench directed the competent authority to consider the application of the petitioner for grant of fresh lease and decide the same within a period of three months from the date of its order keeping in view the order dt.1.8.1996 passed by the Supreme Court in Civil Appeal No.9169 of 1994, order dt.22.8.2002 passed by the Division Bench of this Court in Writ Petition No.28746 of 1998 and Section 4 of the Act 15 of 1992 as amended by Act No.1 of 2000. It declared that neither their Lordships of the Supreme Court intended nor the direction contained in order dt.1.8.1996 in Civil Appeal No.9169 of 1994 can be read as casting an obligation on 1st respondent to grant fresh lease to petitioner without insisting on compliance of the mandate of Section 4(2) and that petitioner's case for grant of fresh lease is liable to be considered in consonance with Section 4 of the 1992 Act. It ruled that G.O.Ms.No.367 dt.23.12.2003 cannot be read as imposing a duty on the State Government to grant fresh lease to the petitioner ignoring the provisions of Section 4(2) of the 1992 Act.

19. After passing of orders in Writ Appeal No.1632 of 2005 by the Division Bench of this Court, the 2nd respondent passed the impugned order in ref No.13/1/2004/0035/0035/FD dt.16.6.2007 rejecting the request of the petitioner for grant of fresh lease or for grant of freehold rights.

20. Challenging the same, the petitioner filed appeal to the 1st respondent under Section 9 of Act 15 of 1992 as amended by Act 1 of 2000.

21. By letter No.3981/IF-Cell/A1/2008-20 dt.26.3.2010, the 2nd respondent rejected the appeal of the petitioner against the order dt.16.6.2007.

22. Challenging the same, the present writ petition has been filed. THE CONTENTIONS OF THE PARTIES :

23. The counsel for the petitioner contended that once G.O.Ms.No.89 dt.18.02.1985 was declared as illegal and arbitrary and not binding on the petitioner by virtue of the decree dt.15.04.1986 in O.S.No.209 of 1985 of the II Addl. Judge, City Civil Court, Hyderabad, and the said judgment was confirmed by dismissal of CCCA.No.118 of 1986, the grounds of (a) non-utilization of industrial plot by the petitioner, (b) non-establishment of dyeing and printing industry by petitioner and (c) parting with portions of the plot allotted to it to third parties, stood obliterated and the same cannot be relied upon by respondents once again to reject its claim for fresh lease/conversion into freehold in view of the principle of res judicata / estoppel by judgment; that if this is permitted, it would amount to allowing the respondents to sit in judgment over the decision of the Civil Court; that when 1st respondent issued G.O.Ms.No.223 dt.11.06.1993 again cancelling the lease of the petitioner, it is to be implied that 1st respondent had accepted that the cancellation of the lease vide G.O.Ms.No.89 dt.18.02.1985 as invalid; since G.O.Ms.No.223 dt.11.06.1993 was directed by the Supreme Court to be eschewed from consideration, it is not open to respondents again to take into account the same grounds contained in G.O.Ms.No.89 dt.18.02.1985 and G.O.Ms.No.223 dt.11.06.1993; and that the order of 2nd respondent dt.16.06.2007 and the order of the 1st respondent dt.26.03.2010 are both vitiated by non-application of mind and are contrary to the orders passed by Courts of Law.

24. He also submitted that the provisions of the Act 15 of 1992 as amended by Act 1 of 2000 are prospective and no disqualification spelt out by a statute can be attributed against a person with retrospective effect; that when the Act 15 of 1992 itself came into force in 1992, and the allegations that were levelled against petitioner are relatable to the year 1984, they cannot form any basis or foundation for applying the disqualification provision contained in Section 3 of the Act 15 of 1992 to petitioner; the disqualification laid down by Act 15 of 1992 as amended by Act 1 of 2000 can be applied only against such lessees who were allowed to continue in possession and at any rate, the disqualifications referred to in the said Act should be taken as acts or omissions which occurred subsequent to the date of coming into force of the said Act i.e., after 17.2.2000; and that as the petitioner has been out of possession admittedly since June, 1993 onwards, the disqualifications laid down in the Act 15 of 1992 as amended by Act 1 of 2000 cannot be applied against the petitioner.

25. Referring to the provisions of the Act 15 of 1992 as amended by Act 1 of 2000, it is contended by counsel for petitioner, relying on Kartar Singh v. State of Punjab1 that sub-section (2) of Section 3, insofar as it directs that lessees of plots whose leases shall not be cancelled under Clause (b) of sub- section (1) would be entitled to grant of fresh lease with effect from the appointed date, is vague on the ground that it delegates the basic policy to be decided by the respondents. Alternatively, it is urged that under the lease deed there were no conditions of the nature set out in Section 3(1)(b) of the Act 1 of 2000; so in 1984, the petitioner did not know that it should not misuse the land/sub-let or transfer the land or violate the terms and conditions in the lease deed; and therefore, Section 3(1)(b), being punitive in nature, cannot be retrospective and would come into force only from 17.02.2000, the date when Act 1 of 2000 was notified; and that ex post facto, conduct of the petitioner cannot be interpreted as one disqualifying it without such conduct being specified in the lease deed as one inviting penal consequences as held in A.L. Kalra v. The Project and Equipment Corporation of India Ltd.2 It is submitted that Section 3 of the amended Act applies to the petitioner and not Section 4 thereof since the petitioner's conduct cannot be construed as incurring disqualification under Section 3(1)(b). Consequently, under sub-section (2) thereof, the petitioner is entitled as of right for grant of fresh lease or under sub-section (3) thereof for freehold right. It is also contended that the term "appointed date" used in Section 4 of the Act (as amended) should be construed as referring to 17.02.2000, the date on which the Act 1 of 2000 came into force and cannot be construed as 03.06.1992, when the original Act came into force.

26. It is also contended by petitioner that Act 15 of 1992 as amended by Act 1 of 2000 did not automatically terminate its lease; no enquiry as required by Clause (a) of sub-section (1) of Section 3 finding that petitioner incurred the disqualifications set out in Clause (b) of sub-section (1) of Section 3 was done; therefore, petitioner has a statutory right for grant of fresh lease under sub-section (2) of Section 3 or for freehold right under sub-section (3) of Section 3 which could not be denied by the respondents; the right conferred by Section 4 on a lessee or person in occupation is one in addition to the one conferred under sub-section (2) and (3) of Section 3 and is in the nature of a limited grant; that only in respect of grants under Section 4, orders of primary or appellate authorities are required; when the petitioner fits into sub-section (2) and (3) of Section 3, the tests prescribed by sub-section (2) of Section 4, i.e., actual user and deserving grant of lease to be decided by the competent authority, cannot apply to petitioner. Section 3 of the Act 15 of 1992 as amended by Act 1 of 2000 cannot nullify the decision of the Civil Court in O.S.209/1985 and is binding on the Authorities under the Act as held in Hope Plantations Ltd. v. Taluk Land Board3.

27. It is further contended that the alleged sub-lessees of the petitioner are allowed to continue in possession of the respective portions of the industrial plots and given opportunity to apply for fresh lease/conversion into freehold when there was no relationship of lessor and lessee between the State and such entities; allowing such entities to continue in possession and enabling them to apply for grant of fresh lease while blaming the petitioner and disqualifying it for allowing the said entities to occupy portions of the industrial plots as sub-lessees is discriminatory and violates Article 14 of the Constitution of India; both the respondents should have taken into account G.O.Ms.No.367 dt.23.12.2003 wherein 1st respondent concluded the whole matter in favour of the petitioner and directed the 2nd respondent to do the needful for grant of fresh lease to the petitioner and since the said GO is not set aside or withdrawn by the State Government, the respondents cannot pass an order contrary to the said G.O. The petitioner therefore prayed that in view of sub-section (2) and (3) of Section 3 and G.O.Ms.No.367 dt. 23.12.2003, a Writ of Mandamus should be issued by this Court to give effect to the statutory grant in favour of the petitioner as per the Act. The counsel for the petitioner also relied upon Regional Provident Fund Commissioner v. Hooghly Mills Company Limited and others4 and Union of India and others v. Brigadier P.S. Gill5.

28. Per contra, the learned Government Pleader contended that although the State Government had executed a lease deed in favour of the petitioner in 1965 for 99 years to enable the petitioner to establish a dyeing and printing industry, the petitioner did not establish such an industry, it violated the terms and conditions of the lease by sub-letting the property/plot allotted to it to M/s.Navneet Oil Industries, M/s.National Engineering Services and M/s.Vaneskeran Industries without any prior permission/approval of the Government under the guise of partnership deeds which are nothing but sub- leases, apart from collecting rents from these entities up to 1992; from 1992, after getting permission from 1st respondent, the above entities had become lessees directly under 1st respondent vide Government Memo No.581-1F Cell - 84 dt.03.12.1992; the Government can cancel the lease of petitioner and take back possession at any time if the terms and conditions are violated; the vires of Act 15 of 1992 was upheld by judgment dt.18.08.1994 in W.P.No.12235 of 1994 and batch; subsequently G.O.Ms.No.223 dt.11.06.1993 was passed terminating the leasehold rights of the petitioner; W.P.No.7696 of 1993 filed by the petitioner challenging the said G.O. was dismissed on 08.07.1993 and confirmed in W.A.No.741 of 1993; in Civil Appeal No.9169 of 1994, the Supreme Court did not express any opinion on the merits and directed the State Government to consider the case of petitioner for grant of fresh lease keeping in view the proposed amendment to Act 15 of 1992 Act without taking into account the fact that the petitioner's lease was earlier cancelled; after Act 1 of 2000 was passed, the petitioner made a representation dt.12.09.2002 for grant of fresh lease; accordingly, personal hearing was granted to it by 2nd respondent and 1st respondent; that the said authorities carefully examined the matter and rejected the case of the petitioner for grant of fresh lease; although the petitioner sought implementation of G.O.Ms.No.367 dt.23.12.2003 and sought the benefits conferred on him under the said G.O. by filing W.P.No.20488 of 2004 in this Court and the single Judge by order dt.10.06.2005 directed the respondents to consider the request of the petitioner for grant of freehold rights in terms of G.O.Ms.No.367 dt.23.12.2003 without insisting on production of documents specified in the letter of the 2nd respondent dt.26.05.2004, the said order was set aside by the Division Bench on 12.3.2007 in W.A.No.1632 of 2005 ; the Division Bench in the said order recorded that the order dt.01.08.1986 in Civil Appeal No.9169 of 1994 did not contain any mandate to grant fresh lease to the petitioner and only directed consideration of his claim for such fresh lease, that such a consideration can only be in accordance with sub-section (2) of Section 4, that the petitioner had also filed an application under Section 4 and that G.O.Ms.No.367 dt.23.12.2003 cannot be read as imposing a duty on the State Government for grant of fresh lease to the petitioner ignoring sub-section (2) of Section 4; that the petitioner's conduct attracted the provisions of Section 3(1)(b) and as such the application of the petitioner was rightly rejected; petitioner cannot claim the benefit of sub-section (2) or (3) of Section 3 of the amended Act as it is proved that he clearly contravened Section 3(1)(b) conditions; G.O.Ms.No.367 dt.23.12.2003 is contrary to the amended Act and there cannot be any executive order contrary to the statute.

29. The Government Pleader further contended that the interpretation sought to be placed by the petitioner on the provisions of the Act 1 of 2000 is not correct; Act 1 of 2000 amended Act 15 of 1992 Act; while the 1992 Act ( as it originally stood) terminated all subsisting leases without any enquiry irrespective of violation of any of the terms thereof, Act 1 of 2000 amended it and changed the position; after amendment, only those leases would be terminated where the lessees had acted in a manner attracting the grounds specified in Section 3 (1) (b); post amendment, Act 15 of 1992 was beneficial to the lessees insofar as it directed termination of leases (i) only after an enquiry and (ii) after a finding is recorded in such an enquiry that there was misuse or non-use of land, or that a lessee had sub-let or transferred or violated the terms, conditions and covenants specified in the lease; that Act 15 of 2000 as amended by Act 1 of 2000 also used the term "appointed date" in Section 3 and 4 thereof; the said term was not defined in Act 1 of 2000; therefore, the definition of the said term in Section 2 of Act 15 of 1992 as the date appointed under sub-section (2) of Section 1, i.e., the date on which the Government had notified the Act 15 of 1992, i.e., 03.06.1992 has to be taken as the appointed date; in view of this intention of the Legislature, Act 1 of 2000 has to be taken to be applicable from 03.06.1992 only, i.e., retrospectively and not from 17.02.2000 as contended by petitioner; the respondents had rightly considered the conduct of petitioner by 1984 (period prior to 17.02.2000) and rejected its claim; and that the contention of the petitioner that its conduct after 17.02.2000 has to be taken into account is without merit. He also relied on Mahadeolal Kanodia v. The Administrator General of West Bengal6, and Organo Chemical Industries and another v. Union of India and others7 and contended that the provisions of the Act 1 of 2000 are retrospective, are not vague in any manner and the intention of the Legislature is clear and the provisions thereof have to be interpreted in the light of the said intention; looked in that perspective, the orders passed by the respondents do not suffer from any error apparent on the face of record warranting interference by this Court under Article 226 of the Constitution of India.

30. The learned Government pleader also contended that Section 20 of the 1992 Act contained a non-obstante clause providing overriding effect to the provisions of the said Act over any decree or order of a Court, Tribunal or other Authority; that sub-section (b) of Section 23 of Act 15 of 1992 prohibited any Court from enforcing any decree or order directing the continuance of a lease, sub-lease or other arrangement in respect of the demised plot; the Division Bench of this Court in its order dt.18.08.1994 in W.P.No.12180 of 1994 and batch while upholding the constitutional validity of Act 15 of 1992 specifically held that the judgment dt.15.04.1986 of the Civil Court in O.S.No.209 of 1985 in the petitioner's favour would not operate as a bar against the State Government; that the basis of the Civil Court's judgment that assignment of land under partnership agreement does not amount to sub-lease was taken away by explanation to Section 3 of Act 15 of 1992 (as amended) which treated such assignment as a violation of the conditions of the lease notwithstanding anything contained in the Indian Partnership Act, 1932 (vide Goa Glass Fibre Limited v. State of Goa and another8) and therefore the respondents are entitled to take into account the conduct of petitioner by 1984 as a ground for cancellation of it's lease. ANALYSIS :

31. I have noted the contentions of the respective parties.

32. In my opinion, the following questions arise for consideration in this writ petition: (a) Are the amendments made to Act 15 of 1992 by Act 1 of 2000 prospective or retrospective? (b) If yes, can events prior to 1992 be taken into account by respondents while considering the case of the petitioner for fresh lease/freehold as per Act 15 of 1992 (as amended by Act 1 of 2000)? (c) Whether the findings in the judgment dt.15.04.1986 in O.S.No.209 of 1985 of II Addl. Judge, City Civil court, Hyderabad, as confirmed in judgment dt.17.01.2000 in CCCA.No.118 of 1986, operate as res judicata and constitute a bar precluding the respondents from relying upon them as grounds for termination of lease in the impugned orders? (d) Whether the order dt.26.03.2010 of 1st respondent in letter No.3981/IF- Cell/A1/2008-20 and the order dt.16.06.2007 of 2nd respondent in proceeding No.13/1/2004/0035/0035/FD, suffer from error apparent on the face of record warranting interference by this Court in exercise of its Certiorari jurisdiction? (e) Whether the petitioner is entitled for grant of fresh lease/freehold right in the plot Nos.14/1 and 24/2 of the Azamabad Industrial Area, Musheerabad, Hyderabad, and whether the action of the respondents in rejecting its claim is valid? Point (a) :

33. Act 15 of 1992 was enacted in public interest by the State of Andhra Pradesh after it came to it's notice that certain lessees or occupants of plots leased by it or it's predecessors were putting the said plots or portions of plots leased to them in the Industrial Area, Azamabad, Hyderabad to unauthorised uses, misusing valuable industrial urban land for residential purposes, ware- housing activities, sub-letting or transferring the plots or portions of plots by entering into disguised partnerships , transferring of shares of companies to secure leasehold transfers and such erring lessees or occupants were collecting huge amounts through such unauthorised use of plots or portions of plots. With a view to curb such misuse/ unauthorised use of valuable Government land, other irregularities, violations, to prevent non-industrial use including unauthorised constructions, etc. and to regulate the leases afresh ensuring maximum use of existing infrastructure facilities and proper management of valuable urban property of the Government, Act 15 of 1992 was enacted. This can be gathered from the preamble to said Act.

34. Sub-section (1) of Sec.3 thereof provided for termination on the appointed day of all leases or other arrangements made or entered into through a registered deed or otherwise in respect of all demised plots in the Azamabad Industrial Area notwithstanding anything contained in the Indian Contract Act, 1872, the Transfer of Property Act, 1882 or any other law for the time being in force and the terms and conditions of any lease entered into or other arrangement made with any person in respect of any demised plot either by the erstwhile Nizam's Government or by the erstwhile Government of Hyderabad or by the Government of Andhra Pradesh prior to the appointed date. The appointed date was 03.06.1992. On such termination, all sub-leases or other arrangements whatever made by the person in occupation to hold possession of the demised plot would stand annulled automatically and every such demised plot would vest in the Government free from all encumbrances and would be used subsequently for industrial purpose only. Sub-section (2) thereof provided that on termination of the lease or other arrangement under sub-section (1), the rights and liabilities as between the parties to the lease or other arrangement shall cease and determine, but any amount due to the Government from the aforesaid person under the lease or other arrangement so terminated shall be recovered as an arrear of land revenue.

35. Under sub-section (1) of Section 4, on termination of the lease or other arrangement under sub-section (1) of Section 3, the person in occupation became entitled to apply for a fresh lease in the manner prescribed. Under sub-section (2) of Section 4, the competent authority, if satisfied that the applicant is not guilty of violation of any conditions of the lease, may grant fresh lease in accordance with such terms and conditions as may be prescribed or refuse to grant a fresh lease for reasons to be recorded in writing. Proviso to Section 4 stated that where the person in occupation of the demised plot (the lease of which stood terminated under the Act 15 of 1992) was actually using the demised plot for industrial purpose and was not otherwise guilty of violation of any conditions of lease, his application for fresh lease shall not be rejected and he shall be granted a fresh lease on such terms and conditions as may be prescribed. Explanation to Section 4 stated that for the purposes of Act 15 of 1992, notwithstanding anything in the Indian Partnership Act, 1932, the act of a lessee in entering into a partnership agreement or other cognate agreement for carrying on any activity whatsoever on the demised plot shall be deemed to be a violation of the conditions of the lease.

36. Section 5 imposed an obligation on the person in occupation whose lease was terminated under sub-section (1) of Section 3 and to whom a fresh lease was not granted under Section 4 to vacate the demised plot and deliver possession to the competent authority. On his failure to do so, Section 6 enabled the competent authority to pass an order of eviction and then take possession of the demised plot from the person in occupation thereof, if necessary, by taking assistance of the police. Section 7 provided for prosecution and punishment to the person who disobeyed the order of eviction issued under Section 6. Section 8 made such a person also liable for damages or mesne profits for each day of unauthorised occupation from the date of expiry of the period specified in the order of eviction passed under Section 6. Sec.11 provided for payment of solatium to the lessee or person in occupation whose lease is terminated and who was not granted a fresh lease. These are some of the important provisions of the Act.

37. From the above provisions it is clear that all leases of plots in the Azamabad industrial Area granted by the State Government or it's predecessor, subsisting as on 03.06.1992, would stand cancelled irrespective of whether the lessee or person in occupation had committed any act in violation of the terms and conditions of the lease or other arrangement with the lessor/Government.

38. The Constitutional validity of this enactment was upheld by a Division Bench of this Court in its judgment dt.18.08.1994 in W.P.No.12180 of 1994 and batch. The Division Bench held that contractual rights are always subject to statutory provisions which impinge upon either the contract as a whole or any right thereunder and that lessees of Azamabad Industrial Area constitute a distinct and separate class by themselves; that termination of all leases cannot be said to be either discriminatory or arbitrary; that a person can be deprived of the right to property under Article 300-A of the Constitution by law enacted by a competent legislature; and that the termination of lease by operation of law does not amount to taking away any one's property. It also held that even if the determination of lease amounts to acquisition of property, provision is made under Section 11 of the Act for payment of an amount by way of solatium and adequacy of compensation of the amount is not justiciable.

39. Although this judgment was challenged in the Supreme Court in Civil Appeal No.8852 of 1994 and batch by the petitioners in WP 12180/1994 and batch, by order dt.16.04.1996, the Court dismissed the said Civil Appeals holding that the State of Andhra Pradesh undertook not to implement the judgment of the High Court impugned therein; it would not take any action against the industries operating in the Industrial Area concerned and was proposing to amend the Act; that the proposal was already placed before the Cabinet; that the counsel for the State Government stated that no action regarding cancellation of leases, etc. against the industries concerned shall be taken under the Act; and therefore the appeals had become infructuous.

40. Subsequently, by Act 1 of 2000, Act 15 of 1992 was amended. It came into force from 17.02.2000 when it was published in the Gazette.

41. Section 2 of Act 1 of 2000 amended the preamble to Act 15 of 1992 and substituted for the last paragraph of its preamble the following : "2. ... ... ... And whereas it is necessary to give effect to the Directive Principles of State Policy as contained in clauses (b) and (c) of article 39 of the Constitution of India; And whereas it is considered expedient, in public interest, to terminate by law such of the existing leases or other arrangements made or entered into in respect of demised plots or portions thereof in Industrial Area, Azamabad, Hyderabad, which attract any of the grounds stated in clause (b) of sub-section (1) of section 3, to curb, misuse or violations and to prevent the non- industrial use, including unauthorised constructions and to regulate the leases afresh, as may be decided by the Government, with such uniform terms and conditions including reduced lease period and revised rates of premium and quit rent and adoption of standard format of lease deed, thereby ensuring maximum use of existing infrastructure facilities and proper management of valuable urban property of the Government." 42. Section 3 of Act 1 of 2000 substituted Sections 3 and 4 of Act 15 of 1992 by the following : "3. For sections 3 and 4 of the principal Act, the following shall be substituted, namely: - Termination of leases:

3. (1)(a) Notwithstanding anything contained in the Indian Contract Act, 1872, the Transfer of Property Act, 1882, or any other law for the time being in force, and the terms and conditions of any lease entered into or other arrangement made with any person in respect of any demised plot either by the erstwhile Nizam's Government or by the erstwhile Government of Hyderabad or by the Government of Andhra Pradesh prior to the appointed date, all those leases, sub-leases or other arrangements made or entered into through a registered deed or otherwise in respect of all demised plots in Azamabad Industrial Area which after due enquiry attract one or more of the ground for cancellation of lease as specified in clause (b) shall stand terminated on the appointed date and thereupon all such leases, sub-leases or any other arrangement whatsoever made by the person in occupation of the demised plot shall stand annulled and every such demised plot shall vest in the Government free from all encumbrances. (b) Notwithstanding anything contained in any other law for the time being in force, the leases of plots or portions shall be cancelled on either all or any of the following grounds namely :- (i) misusing of land for a purpose other than the purpose for which land was allotted including non-user; or (ii) sub-letting or transferring the plots or portions of plots by entering into disguised partnerships and other unauthorised transfer of interest in the plot; or (iii) violation of any terms, conditions or covenant specified in the Lease Deed. Explanation : For the purpose of this Act, where a lessee enters into a partnership, agreement or other arrangement for carrying on any activity whatsoever on the demised plot, then notwithstanding anything in the Indian Partnership Act, 1932, it shall also be deemed to be a violation of the conditions of the lease. (2) Lessees of plots whose leases shall not be cancelled under clause (b) of sub-section (1) shall be entitled to a grant of fresh lease with effect from the appointed date and renewal thereof from time to time on such terms and conditions as may be prescribed by the Government. (3) The Lessees specified in sub-section (2) may, in lieu of renewal of lease, opt for free-hold rights in respect of the demised plots of land by paying a price equivalent to 75% of the market value as specified for the area in Market value Guidelines under section 47(a) of the Indian Stamps Act, 1899. (4) Upon the termination of the leases or other arrangement in respect of the plot under sub-section (1) the rights and liabilities as between the parties to the lease or other arrangement in respect of plot shall cease and determine, but any amount due to the Government from the aforesaid person under the lease or other arrangement so terminated shall be recovered as an arrear of land revenue. 4.(1) On termination of lease or other arrangements made under clause (a) of sub-section (1) of section 3, a person in occupation and running an industry on the appointed date may apply for a fresh lease in the manner prescribed. (2) On receipt of an application under sub-section (1), the Competent Authority, may where he is satisfied that the applicant has actually been using the demised plot for industrial purpose, and he deserves grant of lease, shall grant a lease on such terms and conditions as may be prescribed." 43. Thus, the amended Section 3 contained in Clause (a) of sub-section (1), a provision for an enquiry as to whether a lessee or a person in occupation has acted in a manner set out in Clause (b) of sub-section (1), i.e., (i) misused the land for a purpose other than the purpose for which land was allotted including non-user; (ii) sub-let or transferred the plots or portions of plots by entering into disguised partnership and other unauthorised transfer of interest in the plot; and (iii) violated any terms, conditions or covenants specified in the lease deed. Only if a finding is arrived at in such enquiry that a lessee had acted in a manner attracting one or other of grounds specified in Section 3 (1) (b), such lessee's lease would be cancelled.

44. Thus while the Act as it originally stood provided that all leases stood terminated whether or not there was any contravention by the lessee, the amending Act made a change in the policy of the State by providing for termination of only such leases or arrangements wherein the lessees had acted in a manner attracting clauses (i), (ii) and (iii) of Clause (b) of sub-section (1) of Section 3.

45. I will now refer to some cases cited by both sides wherein the principles for interpretation of statutes have been discussed by the Apex Court.

46. In Brigadier P.S. Gill (5 supra), the Supreme Court held that each word used in the enactment must be allowed to play its role however significant or insignificant the same may be in achieving the legislative intent and promoting legislative object, that no provision of a statute should be construed in isolation and that provisions of a statute should be construed with reference to the context and in the light of other provisions of the statute so as, as far as possible, to make a consistent enactment of the whole statute.

47. In Regional Provident Fund Commissioner (4 supra), the Supreme Court ruled that a penal statute should be strictly construed and in case of doubt the same should be resolved in favour of the offender.

48. In Mahadeolal Kanodia (6 supra), the Supreme Court while construing the provisions of Calcutta Thika Tenancy (Amendment) Act, 1953 declared : "8. The principles that have to be applied for interpretation of statutory provisions of this nature are well-established. The first of these is that statutory provisions creating substantive rights or taking away substantive rights are ordinarily prospective; they are retrospective only if by express words or by necessary implication the legislature has made them retrospective; and the retrospective operation will be limited only to the extent to which it has been so made by express words, or necessary implication. The second rule is that the intention of the legislature has always to be gathered from the words used by it, giving to the words their plain, normal, grammatical meaning. The third rule is that if in any legislation, the general object of which is to benefit a particular class of persons, any provision is ambiguous so that it is capable of two meanings, one which would preserve the benefit and another which would take it away, the meaning which preserves it should be adopted. The fourth rule is that if the strict grammatical interpretation gives rise to an absurdity or inconsistency such interpretation should be discarded and an interpretation which will give effect to the purpose the Legislature may reasonably be considered to have had will be put on the words, if necessary even by modification of the language used." 49. In Organo Chemicals (7 supra), the Supreme Court said: "11. The bogie of absence of guidelines in the provision and consequential possibility of the authority running berserk or acting hubristically does not frighten. Of course, the more bereft of explicit guidelines a statutory power is, the more searching must be the judicial invigilation to discover hidden injustice and masked mala fides. Even so, let us examine the ground that, absent detailed guidelines, the law is void. What is not explicit may still be implicit. What is not articulated at length may be spun out from single phrase. What is not transparent in particularised provisions may be immanent in the preamble, scheme, purpose or subject-matter of the Act. What is real is not only the gross but also the subtle, if I may strike a deeper note. Such a perspective dispels the submission that Section 14-B is bad as uncircumscribed and over- broad.

48. ....Each word, phrase or sentence is to be considered in the light of general purpose of the Act itself. A bare mechanical interpretation of the words "devoid of-concept or purpose" will reduce must of legislation to futility. It is a salutary rule, well established, that the intention of the legislature must be found by reading the statute as a whole." 50. In Shamarao V. Parulekar v. District Magistrate, Thana, Bombay9, a Constitution Bench of the Supreme Court had laid down that an amendment Act must be read as if the words of amendment had been written into the Act (except where that would lead to an inconsistency) with pen and ink and the old words scored out so that thereafter there is no need to refer to the amending Act at all. (See also Yadlapati Venkateswarlu v. State of Andhra Pradesh10, and State of Maharashtra v. Vithalrao Ganpatrao Warhade11) 51. Keeping in mind these principles, I will now consider the provisions of Act 15 of 1992 and Act 1 of 2000 which amended it.

52. Following the decision in Shamrao V. Parulekar (1 supra), I hold that all the amendments in Act 15 of 1992 made by Act 1 of 2000 should be deemed to have been written into Act 15 of 1992 . If not, it would lead to absurdity and inconsistency as explained below.

53. The amended Section 3(1)(a) provides for termination on the appointed date of leases which attract one or more of the grounds for cancellation specified in Clause (b) thereof after enquiry. The term "appointed date" has not been defined in the Act 1 of 2000 thereby implying that the legislature intended that it would have the same meaning as was provided in the principal Act (Act 15 of 1992) i.e., 03.06.1992. It is thus clear that the intention of the Legislature is to give effect to the amendments as if they were part of the principal Act i.e., w.e.f. 03.06.1992 and it was not its intention that the "appointed date" should be taken as 17.02.2000 (the date when Act 1 of 2000 was notified). If the appointed date is to be taken as 17.02.2000, it would lead to absurdity because the leases of all the lessees had already stood terminated from 03.06.1992 (by virtue of the principal Act 15 of 1992) and the question of again cancelling them after enquiry by applying the amendments made by Act 1 of 2000 would not arise. Thus the whole purpose of confining the cancellation of leases to only those persons in occupation/lessees attracting the grounds specified in Section 3(1)(b) ( as postulated by Act 15 of 1992 as amended by Act 1 of 2000) would be defeated and it would be impossible to operate the provisions introduced by way of the amendment, if Act 1 of 2000 is held to be prospective (i.e., operating from 17.2.2000).

54. The matter can also be looked at from another angle. It is settled law that unless the terms of a statute expressly so provide or necessarily require it, retrospective operation should not be given to a statute so as to take away or impair an existing right or create a new obligation or impose a new penalty otherwise than as regards matters of procedure (S.L. Srinivasa Jute Twine Mills (P) Ltd. v. Union of India and another12 and Govind Das v. ITO13). In terms of Section 6(c) of the General Clauses Act, 1897 also, unless a different intention appears, the repeal would not affect any right, privilege or liability acquired, accrued or incurred under the repealed enactment. What is the effect of the amendment on the existing right of the petitioner, if any? Does it take away or impair an existing right or create a new obligation or impose a new liability on the petitioner? The answer is in the negative. Act 15 of 1992 terminated the lease of the petitioner and all other leases also subsisting on 03.06.1992. Thus, w.e.f. 03.06.1992, the petitioner had no subsisting/existing right in the demised plots as his lease stood terminated from that date in view of Act 15 of 1992. The amendments made by Act 1 of 2000, in effect and in fact provided for cancellation of lease of a lessee only if, after enquiry, it was found that the conduct of the lessee attracted the grounds for cancellation of lease as specified in Section 3(1) (b). Thus Act 1 of 2000 is a beneficial legislation to the lessees as it protected the petitioner and other lessees from an automatic termination of their leasehold rights in the demised plots apart from giving them a right to procedural due process in the form of an enquiry wherein they would have an opportunity to prove that they did not indulge in any activity of the nature specified in Section 3(1)(b). Act 1 of 2000 thus does not impair any existing right of the petitioner or impose any new burden on the petitioner and is in fact beneficial to the petitioner and other lessees. Thus, by giving effect to the amendments retrospectively , no right, privilege, liability of petitioner acquired, accrued or incurred under Act 15 of 1992 (as it originally stood) is affected to his disadvantage. So no prejudice is caused to petitioner if retrospective effect is given to the amendments made in Act 15 of 1992 by Act 1 of 2000.

55. The counsel for the petitioner contended that in para 13 of the counter filed by the 2nd respondent it is stated that the appointed date is 17.02.2000 and therefore the respondents are estopped from contending that the appointed date is 03.06.1992. This contention is also liable to be rejected in view of the decision of the Constitution Bench of the Supreme Court in M/s. Sanjeev Coke Mfg. Co. v. M/s. Bharat Coking Coal Ltd.14 wherein the Supreme Court held that validity of legislation is not to be judged merely by affidavits filed on behalf of the State, but by all the relevant circumstances which the Court may ultimately find and more especially by what may be gathered from what the Legislation itself has said and that once a Statute leaves Parliament House, the Court's is the only authentic voice which may echo (interpret) the Parliament. It held that the Executive's submissions/stand in the counter-affidavit is only their understanding of the Statute and they do not speak for the Legislature. Understanding or misunderstanding of parliamentary intentions by the Executive Government or their spokesmen do not and cannot bind the Legislature and it is ultimately for the Court to say what the Legislature meant to say. Similar view is expressed in Goa Glass Fibre Ltd. (8 supra). In the present case, I have already held that Act 15 of 1992 as amended by Act 1 of 2000 to be effective from 03.06.1992, and therefore, even if the 2nd respondent stated in the counter that the appointed date is 17.02.2000, the same is liable to be ignored and the appointed date is to be taken as only 03.06.1992.

56. Therefore, the contention of the petitioner that in the enquiry by respondents 1 and 2, they should have only taken into account its conduct post 17.02.2000, that the provisions of Act 1 of 2000 are prospective and the amendments have to be taken as effective only from 17.02.2000 is liable to be rejected. Point No.(a) is answered accordingly against the petitioner. Point (b) :

57. I also do not agree with the contention of the petitioner that Act 15 of 1992 itself came into force from 1992, and the allegations that were levelled against the petitioner are relatable to the year 1984 and therefore they cannot form the foundation for applying the disqualification provision contained in Section 3 of the Act to the petitioner.

58. Even the lease deed dt.01.09.1966 executed by the State in favour of the petitioner contained stipulations that the lessee "will not without the previous consent in writing of the lessor use or permit the said premises or any part thereof to be used for any purpose whatsoever other than for use as dyeing and printing works and matters ancillary thereto" and "that the lessee shall not during this demise shall assign the hereby demised premises without the consent in writing of the lessor first obtained to such assignment and that every such assignment shall within one calendar month after the date of registration thereof by the City Registrar of Hyderabad be left at the office of the lessor". The said lease deed also stated "if and whenever there shall be a breach of any of the covenants by the lessee, the lessor may re-enter upon the said premises or any part thereof and immediately thereupon, the lease and all rights of the lessee thereunder shall absolutely determine". Thus, it is not as if the petitioner under the lease was free to keep the premises without use or to sub- let it to any third party as per it's whim and fancy without any consequences flowing from such action. What was thus contemplated in the lease deed also came to be statutorily enacted by Act 1 of 2000 and introduced by way of amendment in Act 15 of 1992. S.3 (as amended and substituted in Act 15 of 1992) provided for cancellation after enquiry if lessees like the petitioner did not do any industrial activity or misused the plot or sub-let it or violated any of terms, conditions or covenants specified in the lease deed. The only difference was that instead of eviction though a civil court (whose jurisdiction was ousted by Section 18 of Act 15 of 1992), a separate forum and machinery was provided for evicting lessees who acted in a manner attracting the grounds specified in S.3(1)(b).

59. It is settled law that even existing rights of parties under a contract can be statutorily regulated and modified in public interest.

60. In Mardia Chemicals Ltd. v. Union of India15 the Constitutional validity of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 was challenged. The Supreme Court rejected the challenge and held : "66. On behalf of the petitioners one of the contentions which has been forcefully raised is that existing rights of private parties under a contract cannot be interfered with, more particularly putting one party in an advantageous position over the other. For example, in the present case, in a matter of private contract between the borrower and the financing bank or institution through impugned legislation rights of the borrowers have been curtailed and enforcement of secured assets has been provided for without intervention of the court and above all depriving them of the remedy available under the law by approaching the civil court. Such a law, it is submitted, is not envisaged in any civilized society governed by rule of law. As discussed earlier as well, it may be observed that though the transaction may have the character of a private contract yet the question of great importance behind such transactions as a whole having far-reaching effect on the economy of the country cannot be ignored, purely restricting it to individual transactions, more particularly when financing is through banks and financial institutions utilizing the money of the people in general, namely, the depositors in the banks and public money at the disposal of the financial institutions. Therefore, wherever public interest to such a large extent is involved and it may become necessary to achieve an object which serves the public purposes, individual rights may have to give way. Public interest has always been considered to be above the private interest. Interest of an individual may, to some extent, be affected but it cannot have the potential of taking over the public interest having an impact on the socio-economic drive of the country. The two aspects are intertwined which are difficult to be separated. There have been many instances where existing rights of the individuals have been affected by legislative measures taken in public interest....

67. It is well known that in different States rent control legislations were enacted providing safeguards to the sitting tenants as against the existing rights of the landlords, which before coming into force of such law were governed by contract between the private parties. Therefore, it is clear that it has always been held to be lawful, whenever it was necessary in the public interest to legislate irrespective of the fact that it may affect some individuals enjoying certain rights." 61. In the case on hand, the statute i.e., Act 15 of 1992 merely reiterated the grounds for cancellation of lease as contained in the lease deed and gave a speedier remedy to the State to recover possession of plots leased in public interest if the lessee has acted in a manner attracting grounds specified in S.3(1) (b). Statutes like the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 also provided such speedier remedy and have been upheld. Moreover the preamble to the Act (post amendment) states that it is enacted to give effect to the Directive principles of State Policy as contained in clauses (b) and (c) of Art.39 of the Constitution of India. In view of Art.31-C of the Constitution of India, the law is immune from challenge on the ground that it violated Art.14 or 19. As a mater of fact the petitioner also has not challenged the Constitutional validity of Act 15 of 1992 as amended by Act 1 of 2000.

62. In my view, taking into account conduct of lessees like the petitioner prior to Act 15 of 1992 to decide whether or not to grant fresh lease to them does not amount to giving retrospective effect to Act 15 of 1992. The provisions introduced by way Act 15 of 1992 as amended by Act 1 of 2000 are retroactive permitting the competent authority to consider the conduct of a lessee prior to 03.06.1992 (when Act 15 of 1992 was enacted) in deciding whether or not a lessee has acted in a manner attracting the grounds specified in Section 3(1)(b) warranting cancellation of it's lease. It would be a case of the statute drawing part of the requisites for its action from a time antecedent to its passing.

63. In N.K. Bajpai v. Union of India16, the Supreme Court had an occasion to consider whether Section 129 (6) of the Customs Act, 1962 (introduced vide Finance Act, 2003) stipulating that on demitting office as member of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), a person shall not be entitled to appear before CESTAT, is ultra vires the Constitution of India and whether it applies to the petitioner in the Supreme Court who had joined as a member and also demitted office as a member of the CESTAT prior to its introduction in 2003. It held that such a restriction on the right of the petitioner and others similarly placed is a reasonable restriction and is not violative of their fundamental rights to practice any profession guaranteed under Articles 14 and 19 of the Constitution of India. It rejected the contention of the appellants that they had enrolled as advocates when the provisions of Section 129(6) were not on the statute book and after ceasing to be members of the CESTAT and starting their practice as advocates, such a bar should not operate as it would amount to giving retrospective effect to the provisions of Section 129(6) taking away their right to practice before such tribunals. It held that Section 129(6) is not retrospective stricto sensu but would be retroactive and the right to practice before a limited forum is being taken away in praesenti while leaving all other forums for practice by the appellants though such a restriction may have the effect of relating back to a date prior to the praesenti and even though the retirement or date of ceasing to be a member of the tribunal may have been on a date anterior to the date of passing of the law. It held: "62. We may refer to R v. St. Mary, Whitechapel (Inhabitants)17 whereby under Section 2 of the Poor Removal Act, 1846 : "2. No woman residing in any parish with her husband at the time of his death shall be removed ... from such parish, for twelve calendar months after his death, if she so long continue a widow." In this case, a widow was sought to be removed within such period of 12 months, on the grounds that her husband had died before the coming into force of that Act. The question was whether that provision applied retrospectively. Lord Denman, C.J.

held that : "... the statute is in its direct operation prospective, as it relates to future removals only, and that it is not properly called a retrospective statute because a part of the requisites for its action is drawn from time antecedent to its passing. Thus, the provision was held not to be retrospective." (emphasis mine) 64. In view of the stipulations in the lease deed set out supra, it is not open to the petitioner to contend that in 1984 he was not aware that he should not misuse the land/sub-let or transfer the land or violate the terms and conditions in the lease deed and that the respondents cannot take into account these facts and cancel its lease as it would then amount to applying ex post facto law.

65. The decision in A.L. Kalra (2 supra) relied upon by the counsel for the petitioner is clearly distinguishable. It dealt with the case of an employee of a statutory corporation who was subjected to disciplinary action for not refunding the advance taken for house building and for purchase of a motorcycle within the time stipulated under the rules. The Supreme Court ruled that a rule, which required an employee to maintain absolute integrity and do nothing which is unbecoming of a public servant at all times, is vague as it is not amenable to objective evaluation and it is obligatory on the employer to specify and if necessary define it with precision and accuracy so that any ex post facto interpretation of some incident may not be camouflaged as misconduct. The said decision is clearly distinguishable as the principle laid down therein would not apply where cancellation of the lease of a lessee of a plot allotted by the State Government is to be made on the grounds set out in Section 3(1) (b) reiterating what was previously set out in the lease deed itself. The concepts of misuse of land or non-use or sub-letting or transferring the plots by entering into partnerships are clearly well-defined and cannot be said to be vague or incapable of objective evaluation exposing lessees to vagaries of subjective evaluation. Holistically considered, I find that there is no ambiguity or vagueness in the provisions of Act 15 of 1992 as amended by Act 1 of 2000.

66. The petitioner contended that the Supreme Court in its order dt.01.08.1996 in Civil Appeal No.9169 of 1994 had directed the respondents to consider the case of the petitioner ignoring the fact that the lease was earlier cancelled in the light of the amendment proposed by the State Government to Act 15 of 1992, and therefore, the respondents are also precluded from looking into the reasons leading to the earlier cancellation. Otherwise, according to the petitioner, it is like ignoring the result and not cause for result. There is no merit in this contention. The petitioner is trying to read into the order passed by the Supreme Court something which is not there in it, i.e., that the causes for the cancellation of the lease of the petitioner are also to be ignored. If the Supreme Court intended it to be so, it would have said so. The fact that the order of the Supreme Court directed re-consideration of the issue of cancellation in the light of the amendment to Act 15 of 1992 in the pipeline by then, indicates that the Court never intended to pronounce any view on the grounds of cancellation of the lease or to exonerate the petitioner from the violation of terms of the lease, if any, committed by it. The remit by the Court to the respondents is only to consider the issue afresh in the light of the said amendment.

67. I also do not agree with the contention of the petitioner that sub-section (2) of Section 3, insofar as it directs that lessees of plots whose leases are not liable for cancellation under Clause (b) of sub-section (1) would be entitled to grant of fresh lease w.e.f. the appointed date, is vague. It is the contention of the counsel for the petitioner that the said provision delegates the basic policy to be decided by the respondents. He placed reliance on the following passage at Para.130, page 648, in Kartar Singh (1 supra). "130. It is the basic principle of legal jurisprudence that an enactment is void for vagueness if its prohibitions are not clearly defined. Vague laws offend several important values. It is insisted or emphasised that laws should give the person of ordinary intelligence a reasonable opportunity to know what is prohibited, so that he may act accordingly. Vague laws may trap the innocent by not providing fair warning. Such a law impermissibly delegates basic policy matters to policemen and also judges for resolution on an ad hoc and subjective basis, with the attendant dangers of arbitrary and discriminatory application. More so uncertain and undefined words deployed inevitably lead citizens to "steer far wider of the unlawful zone ... than if the boundaries of the forbidden areas were clearly marked"." 68. A plain reading of sub-section (2) of Section 3 does not indicate that it is vague in any sense. It entitles a lessee whose lease is not liable to be cancelled under Clause (b) of sub-section (1) of Section 3 to get a fresh lease with effect from the appointed date and also its renewal from time to time on such terms and conditions as may be prescribed by the Government. Thus, only those lessees who act in a manner attracting the grounds specified in Clause (b) of sub-section (1) of Section 3 would have their leases cancelled and others who have acted in accordance with the terms of the lease are not affected and would be entitled for grant of a fresh lease. There is ample guidance in the provisions of Section 3 for the respondents to decide objectively whether a lessee has violated the terms of the lease and once such a decision is taken in favour of a lessee , Sec.3(2) gives him a right to get a fresh lease.

69. For the above reasons, I hold that the petitioner is not right in contending that respondents cannot take into account events prior to 1992 in deciding under Section 3(1) (a) whether the petitioner had acted in a manner attracting one or more of the grounds for cancellation of lease as specified in Section 3(1) (b). Point no.(b) is answered accordingly against the petitioner. Point (c) :

70. The contention of the petitioner is that certain findings had been given in the judgment and decree dt.15.04.1986 in OS.No.209 of 1985 by the II Addl. Judge, City Civil Court, Hyderabad, in his favour on the issue whether he committed breach of the terms of the lease by entering into a partnership dt.06.07.1984 with A.P. Agro Industries apart from other partnerships in 1961 and 1975 with others and that G.O.Ms.No.89, dt.18.02.1985 (under which the 1st respondent had terminated the lease granted in favour of the petitioner) was declared illegal and arbitrary and not binding on the petitioner, that this judgment was confirmed in CCCA.No.118 of 1986 and therefore it was not open to the respondents to rely upon the same grounds and cancel the lease in its favour. He relied upon Hope Plantations Ltd (3 supra) wherein the Supreme Court held that principles of res-judicata and estoppel are based on public policy and justice, that rule of res-judicata prevents the parties to a judicial determination from litigating the same question over again even though the determination may be demonstrably wrong and when the proceedings have attained finality, parties are bound by the judgment and are estopped from questioning it. I reject this contention for the reasons mentioned below.

71. After Act 15 of 1992 was passed, a show-cause notice dt.03.12.1992 was issued by 1st respondent to petitioner alleging that the petitioner did not set up any industry for the purpose for which lease was granted having taken possession on 10.03.1943, that he sub-leased part of the land to M/s.Navneet Oil Industries, M/s.National Engineering Service and M/s.Vaneskaran Industries, without prior approval from the Government under the guise of partnership deeds which were nothing but sub-leases and that even after execution of the lease deed on 01.09.1965, it did not make any attempt for starting a dyeing and printing industry in the leased land. It is also alleged that it entered into another partnership deed dt.06.07.1984 with one A.P. Agarwal and four others in the name and style of M/s.A.P. Agro Industries, valued the leasehold rights including the leasehold property of Rs.4.0 lakhs and transferred the same to the said firm thus divesting itself of the control and possession over the demised premises and affecting absolute transfer of interest in favour of the said firm. The petitioner replied to the said notice on 22.12.1992 denying the allegations and relying on the judgment of the civil court in O.S.No.209 of 1985. Vide G.O.Ms.No.223, Industries and Commerce (IF Cell) Department, dt.11.06.1993, the 1st respondent terminated the leasehold rights granted to the petitioner, resumed the land to the Government custody immediately without affecting the interests and functioning of the three SSI units, i.e., M/s.Navneet Oil Industries, M/s.National Engineering Service and M/s.Vaneskaran Industries. It is not disputed that on 12.06.1993 possession was taken from the petitioner pursuant to the above order.

72. Challenging the same the petitioner filed W.P.No.7696 of 1993 in the High Court. By order dt.08.07.1993, the said writ petition was dismissed. Aggrieved thereby, the petitioner filed W.A.No.741 of 1993. This writ appeal was heard along with W.P.No.12184 of 1994 and batch wherein the validity of Act 15 of 1992 was also challenged.

73. Before the Division Bench it was contended by the petitioner that the basis of passing G.O.Ms.No.223 dt.11.06.1993 was assignment of land under the partnership agreements entered into by it, that such assignment amounted to a grant of sub-lease, that this contention was rejected in O.S.No.209 of 1985 by the Civil Court and therefore the said ground cannot be relied on by respondents. The Division Bench rejected the said contention in its common judgment dt.18.08.1994 in W.P.12180/1994 relying on explanation to Section 4 in Act 15 of 1992 (which stated that where a lessee enters into a partnership agreement in respect of the demised plot, then notwithstanding anything in the Indian Partnership Act, 1932, they shall also be deemed to be in violation of the conditions of the lease).

74. The petitioner filed S.L.P.No.9169 of 1994 against the order dt.18.08.1994 in W.A.No.741 of 1993 and the Supreme Court disposed of the said appeal directing that the case of the petitioner for grant of fresh lease shall also be considered in the light of the amendments to Act 15 of 1992 being proposed by the State Government without taking into consideration the fact that its lease was earlier cancelled. The Supreme Court did not accept the petitioner's contention that the grounds which formed the basis for cancellation of it's lease earlier cannot be again relied on by respondents.

75. It is pertinent to note that Act 1 of 2000 which amended Act 15 of 1992 incorporated the same explanation to the amended Section 3 as was there in the un-amended Section 4 of Act 15 of 1992 (which was relied in the order in 18.8.1994 in W.A.741/1993). Thus, in view of the said explanation to Section 3 (which provides that where a lessee enters into a partnership agreement in respect of the demised plot, then notwithstanding anything in the Indian Partnership Act, 1932, it shall also be deemed to be in violation of the conditions of the lease), the judgment of the Civil Court in O.S.No.209 of 1985 will not operate as a bar. It is settled law that the Legislature can render a judicial decision ineffective by enacting a valid law on the subject within its legislative field by removing the base on which the decision was rendered [See S.S.Bola v. B.D. Sardana18 and in Goa Glass Fibre Ltd. (8 supra)]. This is what has happened in the instant case also.

76. The matter can be looked at from another angle also. Section 20 of Act 15 of 1992 states : "20. The provisions of this Act and the rules made thereunder shall have effect, notwithstanding anything inconsistent therewith in any other law for the time being in force, or any custom, usage or agreement, or decree or order of a court, tribunal or other authority." Section 23 of Act 15 of 1992 states : "23. Notwithstanding anything in any judgment, decree, or order of any court or other authority , -- (a) no suit or other proceeding shall be maintained or continued in any court or before any authority for the continuance of the lease, sub-lease or other arrangement or for the lessee, sub-lessee or person in occupation staying on the demised plot and all such proceedings shall abate; and (b) no court shall enforce any decree or order directing the continuance of the lease, sub-lease or other arrangement to be in occupation of the demised plot.

77. In view of Section 20 and Clause (b) of Section 23 referred to above, the judgment of the Civil Court in O.S.No.209 of 1985 would not prevail over the provisions contained in Act 15 of 1992 and any findings rendered therein would not come in the way of the respondents while considering the case of petitioner in the light of Act 15 of 1992 as amended by Act 1 of 2000 pursuant to the order dt.01.08.1996 of the Supreme Court in Civil Appeal No.916 of 1994. Therefore, point (c) is also answered against the petitioner. Points (d) and (e) :

78. After Act 1 of 2000 which amended Act 15 of 1992 was enacted, the petitioner applied to 2nd respondent for grant of fresh lease/freehold rights vide representation dt.12.09.2002. This was placed before the 1st respondent. It issued G.O.Ms.No.367 Industries and Commerce (IF Cell) Department dt.23.12.2003, cancelling G.O.Ms.No.223 dt.11.06.1993 and extending the "lease fresh hold rights" (sic) of the remaining area to the petitioner except to the extent under the occupation of SSI units. It directed the 2nd respondent to verify the existing buildings structure which were constructed in the plots as per the sanctioned plan and which are occupied by SSI units in the premises and decide accordingly as per law after verifying the partnership lease agreements entered into with the SSI units.

79. The petitioner sought implementation of this G.O.Ms.No.367 dt.23.12.2003 in W.P.No.20488 of 2004. By order dt.10.06.2005 the said writ was disposed of directing the respondents to reconsider the request to the petitioner under its application dt.16.03.2004 for grant of freehold rights in terms of the said G.O. without insisting on production of documents such as sales tax assessment order for 1999-2000, electricity consumption bill for February, 2000 and any other documentary proof that the petitioner was carrying on industrial activity on 17.02.2000.

80. The respondents filed W.A.No.1632 of 2005 against the said order in W.P.No.20488 of 2004. The said appeal was allowed by an order dt.12.03.2007. The Division Bench held that order dt.01.08.1996 in Civil Appeal No.9169 of 1994 did not contain any mandate for grant of fresh lease to petitioner and that it merely directed consideration of the claim of petitioner for grant of fresh lease, that such consideration can only be in accordance with the mandate of Section 4 (2) of the Act 15 of 1992 as amended by act 1 of 2000 and G.O.Ms.No.367 dt.23.12.2003 cannot be read as imposing a duty on the State Government for grant of fresh lease to petitioner ignoring Section 4 (2).

81. In view of this order, the petitioner cannot contend that it has a right to get a fresh lease/freehold right basing on G.O.Ms.No.367 dt.23.12.2003 and that the respondents are estopped from denying its claim for fresh lease/freehold of the plots in question. Moreover when the Act 15 of 1992 as amended by Act 1 of 2000 authorises the 2nd respondent to conduct an enquiry and the 1st respondent is constituted only as an appellate authority, the 1st respondent could not have usurped the powers of the 2nd respondent and decided in favour of the petitioner. Such an order is thus without jurisdiction as it is ultravires Act 15 of 1992, null and void.

82. After the decision in W.A.No.1632 of 2005, the 2nd respondent provided an opportunity for personal hearing to the petitioner through its legal counsel to present its case. After considering the facts and circumstances and referring to the order in the said Writ Appeal, the order dt.01.08.1996 in Civil Appeal No.9169 of 1994, the order dt.22.08.2002 in W.P.No.28746 of 1998 and Section 4 of Act 15 of 1992 as amended by Act 1 of 2000, the 2nd respondent passed the impugned order, dt.16.06.2007 in proceedings Ref.No.13/1/2004/0035/0035/FD, rejecting the request of the petitioner for a grant of fresh lease or for a grant of freehold right in the demised plots.

83. The 2nd respondent held that the petitioner had not produced any documentary evidence to show that they ever set up "dyeing and printing industry" in the demised plots; that an inspection report of the Regional Development Officer (Industries) Twin Cities (Urban) conducted along with other officers on 12.07.1984 revealed that there was no industrial activity on the part of the petitioner connected to dyeing and printing and that the asbestos cement industry set up by the petitioner was shifted to another place; that a report filed by Advocate-Commissioner appointed in I.A.No.2552 of 1985 in O.S.No.209 of 1985 in the Court of II Addl. Judge, City Civil Court, Hyderabad, on 04.02.1986 also gave a similar finding; that an Advocate-Commissioner appointed in W.A.No.741 of 1993 in his inspection report dt.19.07.1993 also found no machinery in any of the rooms or open space installed by petitioner, that there was no industrial activity being carried on by the petitioner in the demised premises and the Advocate Commissioner did not find any records or even a paper in any of the rooms. In view of these facts, the 2nd respondent opined that the petitioner attracted the disqualification mentioned in Section 3(1)(b)(i) of the Act 15 of 1992 as amended by Act 1 of 2000, i.e., non-user. The 2nd respondent held that petitioner admitted in the course of hearing that it inducted three SSI units into the demised premises and did not adduce any documentary evidence, during the enquiry by 2nd respondent, to prove that such induction was with the permission of the Government; that the petitioner entered into partnership deeds dt.09.11.1960, 10.10.1968 and 28.02.1974 with M/s.Navneet Oil Industries, M/s. National Engineering Service and M/s.Vaneskaran Industries, subleasing certain extents of land to them without any Government permission; that this amounts to violation of terms of the lease deed; and that transferring of portions of the plots by entering into disguised partnerships comes within the ambit of disqualification mentioned in Section 3(1)(b)(ii) read with the explanation under Section 3. The 2nd respondent also referred to the fact that petitioner's application dt.16.03.2004 to 2nd respondent was signed by Mr.A.P. Agarwal (Partner of M/s A.P.Agro Industries), as Power of Attorney holder; this disproves the petitioner's contention that it had nothing to do with M/s.A.P. Agro Industries in which Mr.A.P. Agarwal and others were partners; that M/s. A.P. Agro Industries had filed several cases in the City Civil Court and also in the High Court of Andhra Pradesh such as W.P.No.9795 of 1993 and O.S.No.1545 of 1984; and even during the inspection by the Regional Director of Industries (Urban) Twin Cities on 12.07.1984 with other officers, it was noticed that the ground was being cleaned under the supervision of the personnel of M/s.A.P.Agro Industries; that Mr.A.P. Agarwal also appeared in the hearing before the 2nd respondent on 11.06.2007; and therefore, it is proved that the petitioner had entered into disguised partnership with M/s.A.P. Agro Industries for gain without the approval of the Government in violation of the terms of the lease which attracts the disqualification mentioned in Section 3(1)(b)(ii) and (iii) read with the explanation to Section 3. He also rejected the contention of the petitioner that by virtue of G.O.Ms.No.367 dt.23.12.2003, the lease of the petitioner is subsisting relying on the order dt.12.03.2007 in W.A.No.1632 of 2005.

84. Aggrieved thereby, the petitioner filed an appeal to the 1st respondent.

85. By proceedings letter No.3981/IF.Cell/A1/2008-20, Industries and Commerce (IF.Cell) Department, dt.26.03.2010, the 1st respondent rejected the appeal filed by petitioner agreeing with the reasons given by the 2nd respondent.

86. In it's order, the 1st respondent held : (a) The petitioner failed to carry out the industrial activity "Dyeing and Printing" for which the land was allotted. (b) Instead of starting their own industry, petitioner resorted to several illegal and unjust methods of sub-leasing some portions in the demise plot to (1) M/s. Navneet Oil Industries (2) M/s.National Engineering Services and (3) M/s. Vaneshkaran industries, without any prior approval from Government. (c) It remained as a non-user as observed by the competent authority and Commissioner of Industries in para 14 of its proceedings dated 16.6.2007. Though, it had taken possession of the land on 10.3.1943, it did not produce any documentary evidence to the effect that it has set up "dyeing & printing" industry earlier or even after 7 years of judgment and decree dated 15.4.1986 in O.S.No.209/1985 and till issue of G.O.Ms.No.223, dated 11.6.1993 terminating the lease hold rights for the reasons mentioned therein after following due procedure. The W.P.No.7696/93 filed challenging G.O.Ms.No.223, dated 11.6.1993 was dismissed. W.P.No.9795/93 filed by A.P. Agro Industries on this subject matter was also dismissed on 20.7.1993. After termination of lease, Government took possession of the plots on 12.6.1993 except the portion of the land under occupation of three SSI units, who were permitted to carry on their business by the Hon'ble High Court of A.P. in W.A.M.P.No.1352/93 in W.A.No.741/93. Thus, the Government is entitled to enter into the demise premises in the event of contravention of the terms and conditions of lease by the lessee. (d) It is held in O.S.No.481/1986 and O.S.No.1291/1994 that the previous partnerships are nothing but means to get over the stipulations of the Government in the Lease Deed and observed that the partnership deed dated 6.7.1984 is in clear violation of the terms of the Lease Deed dt.1.9.1965 in respect of the leased land and its terms clearly show that it is only a camouflage of assignment in favour of M/s.A.P. Agro Industries. Petitioner quantified the lease hold property including the value of the lease hold rights on the land at Rs.4.00 lakhs without retaining any power to redeem/reconvert back to lease hold rights which for all purposes is an assignment, culminating into a trading asset of M/s.A.P. Agro Industries, who has no locus-standi and is also an absolutely stranger as far as the leased land is concerned. (e) The report of the Advocate-Commissioner appointed by the High Court in W.A.No.741/1993 clearly established that there was no "Industrial Activity" being carried out by the petitioner in the demise premises, and it was also accepted by Court as none of the parties filed any objection to it.(order dated 22.7.1993 in W.A.M.P.No.1352 in W.A.No.741/93). (f) The order passed by the Competent Authority is strictly in terms of orders passed by the High Court in W.A.No.1632/2005 and as per law. (g) It is incorrect to say that the order passed by the Competent Authority is illegal, having been passed without referring to the detailed written submission and non-consideration of the salient features. The application made by petitioner for grant of fresh lease has been considered keeping in view the order dated 1.08.1996 of Hon'ble Supreme Court in Civil Appeal No.9169 of 1994, order dated 22.08.2002 passed by Division of Hon'ble High Court in WP No.28746 of 1998 and Section 4 of the 1992 Act as amended by Act No.1 of 2000. (h) The orders issued by the Government in G.O.Ms.No.367, dated 23.12.2003 restoring the lease hold rights in favour of the petitioner have been dealt with in W.A.No.1632/2005. The Court held that G.O.Ms.No.367 cannot be read as imposing a duty on the Government for grant of fresh lease. In other words the petitioner's request for free hold rights or any other rights need to be considered as per Act 15 of 1992 as amended by Act 1 of 2000 only. (i) The petitioner, as stated above, failed to establish industry of "Dying & Printing" even after lapse of the period of seven years of the Orders passed by the II Addl. Judge, City Civil Court, Hyderabad in O.S.No.209/85. (j) The petitioner is a "non-user" and did not use the land for a purpose for which it was allotted. Hence, it attracts disqualification under Section- 3(1)(b)(ii). (k) The petitioner transferred the plots by entering into disguised partnerships and attracts disqualification U/s.3(1)(b)(ii). (l) The petitioner violated the terms and conditions and covenants as specified in the lease deed and hence attracts disqualification under Section- 3(1)(b)(iii).

87. A reading of the orders of the 2nd respondent and 1st respondent indicate that they have considered all the facts and circumstances, rightly interpreted provisions of Act 15 of 1992 (post amendment) and have rightly come to the conclusion that the petitioner had failed to carry out industrial activity of dyeing and printing for which the land was allotted to it, that it had sub-let portions of the demised plot to M/s.Navneet Oil Industries, M/s.National Engineering Services and M/s.Vaneskaran Industries, apart from M/s.A.P. Agro Industries without the permission of the 1st respondent and thereby attracted disqualification under Section 3(1)(b)(i), (ii) and (iii) of Act 15 of 1992 as amended by Act 1 of 2000. Both the respondents have also considered the order dt.12.03.2007 in W.A.No.1632 of 2005, order dt.01.08.1996 in Civil Appeal No.9169 of 1994, order dt.22.08.2002 in W.P.No.28746 of 1998 and Section 4 of Act 15 of 1992 as amended by Act 1 of 2000.

88. Section 4 of Act 15 of 1992 as amended by Act 1 of 2000 states: "4.(1) On termination of lease or other arrangements made under clause (a) of sub-Section (1) of Section 3, a person in occupation and running an industry on the appointed date may apply for a fresh lease in the manner prescribed. (2) On receipt of an application under sub-section (1), the Competent Authority, may where he is satisfied that the applicant has actually been using the demised plot for industrial purpose, and he deserves grant of lease, shall grant a lease on such terms and conditions as may be prescribed." 89. As the petitioner was found in the enquiry conducted by 2nd respondent to be not actually using the demised plot for industrial purpose, the respondents rightly held that it did not deserve grant of fresh lease or grant of freehold rights.

90. I do not find any error apparent on the face of record warranting interference with the orders passed by the respondents. The respondents have correctly applied the legal principles and appreciated the material on record in coming to a conclusion that the petitioner did not deserve grant of fresh lease/freehold rights. Issues (d) and (e) are thus answered against the petitioner.

91. Insofar as the contention of the petitioner that its application should have been considered not under Section 4 but under Section 3(2) or Section 3(3) is concerned, the said provisions would apply only in respect of lessees of plots whose leases are not liable to be cancelled under Section 3(1)(b) and once the petitioner's lease is held liable to be cancelled under Section 3(1)(b), Section 3(2) or Section 3(3) cannot be invoked by the petitioner. Apart from this, the petitioner made it's application for grant of fresh lease to 2nd respondent under Section 4 of Act 15 of 1992. In the order dt.22.8.2002 in W.P.28746 of 1998 and in the order dt.12.3.2007 in W.A.No.1632/2005 also this Court directed that the petitioner's case for grant of fresh lease is to be considered in consonance with Section 4. Therefore the respondents rightly considered the case of petitioner under Section 4 and rejected it's request for fresh lease.

92. I also do not find any merit in the contention of the petitioner that the alleged sub-lessees of the petitioner are allowed to continue in possession of the respective portions of the industrial plots and given opportunity to apply for fresh lease/conversion into freehold when there was no relationship of lessor and lessee between the State and such entities; and that allowing such entities to continue in possession and enabling them to apply for grant of fresh lease while blaming the petitioner and disqualifying it for allowing the said entities to occupy portions of the industrial plots as sub-lessees is discriminatory and violates Article 14 of the Constitution of India. It is settled law that legislature is free to recognise the degrees of harm and may confine it's restrictions to those where the need is deemed to be the clearest (See Mohd.Murtaza v. State of Assam19 and Mohd. Hanif Qureshi v. State of Bihar20). It must be presumed that the legislature correctly understands the needs of it's own people and it's laws are directed to problems made manifest by experience and it's discriminations are based on adequate grounds (See Mahant Moti Das v. S.P.Sahi21). In any event, the petitioner has not challenged the vires of Act 15 of 1992 as amended by Act 1 of 2000 on the ground of violation of Art.14 of Constitution of India and even if it did, such a challenge is impermissible in view of Art.31-C as preamble to Act 15 of 1992 (as amended by Act 1 of 2000) states that it is intended to give effect to the Directive principles of State Policy as contained in clauses (b) and (c) of Art.39 of the Constitution.

93. For all the foregoing reasons, I find no merit in the Writ Petition and the same is accordingly dismissed. No costs. _________________________________ JUSTICE M.S.RAMACHANDRA RAO Date:

06. 06-2013


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