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Gajanan Marotrao Balpande Vs. Municipal Commissioner of the City of Nagpur Corporation - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtMumbai High Court
Decided On
Case NumberSpecial Civil Application No. 318 of 1961
Judge
Reported in(1962)64BOMLR546
AppellantGajanan Marotrao Balpande
RespondentMunicipal Commissioner of the City of Nagpur Corporation
DispositionPetition dismissed
Excerpt:
.....of period of licence--compensation to be paid to corporation for leaving premises before expiry of licence- corporation giving premises to another person on rent less than that paid by first licencee--claim made by corporation against licencee for rent due and compensation--whether claim falls within section 374--licence of immovable property whether amounts to a contract.;the petitioner took a stall which belonged to the municipal corporation which was governed by the city of nagpur corporation act, 1948, on a licence for a period of about thirteen months and on a certain monthly rent. under the terms of the licence the petitioner had to compensate the corporation for the loss that the corporation might suffer as a result of his leaving the stall before the expiry of the period of the..........for the use and occupation of tho stall. it was only within a very short time after he took the stall licence that the licensee ('hose to abandon it. clause 2 of the licence, however, provided that in that: event the licensee shall be liable to compensate the corporation, for whatever loss it might suffer by virtue thereof. it is on this basis that the corporation has made a claim of rs. 1,100 against the petitioner. in our opinion, it is a claim for a sum of money which became due to the corporation on account and in respect of a transaction which was duty authorised under the act and properly recoverable under section 374 of that act.6. we may mention that this point, was not urged before the municipal commissioner and the appeal before him was dismissed merely on the ground that.....
Judgment:

Shah, J.

1. This petition is filed by a dealer in potteries against an order of the Municipal Commissioner of the City of Nagpur Corporation, whereby the appeal filed by the petitioner was rejected. The appeal was directed against a bill dated September 21, I960, served by the Market Department of the Corporation on the petitioner claiming an amount of Its. 1,100 for the period June 1, 3960 to March 31, 1961, in respect of a stall, which the petitioner had taken on, licence from the Corporation in one of the city markets. It was urged before the Municipal Commissioner that the petitioner had vacated the stall on April 1, 1960, and that, accordingly, the Corporation had taken possession thereof from him as on that date and that, therefore, he was not liable to pay any amount for any period subsequent to that date.

2. It appears that the petitioner took block No. 11 of Itwari chawl in an open auction on a monthly rent of Its. 158 and in regard thereto he executed an agreement in favour of the Corporation. The agreement was one of licence and the period of the licence was from February y, 1960 to March 31, 1961. Clause 2 of the licence provided as follows:

The period of licence shall be from 3-2-60 to 31-3-61. No licence holder shall leave the shop before the expiry of the period. Should he leave the shop, he shall have no right to demand the advance paid money. The man leaving the shop shall have to compensate the Corporation for the loss that the Corporation may suffer.

3. It appears that the petitioner, shortly after he took the premises on licence, did not desire to continue the licence, and accordingly, he vacated the stall and handed it over to the Corporation on April 1, I960. The Corporation thereafter put the stall to auction on as many as four occasions, namely, on April 21, 1960, May 28, 1960, June 19, 1960, and July 29, 1960, and it was only on the last occasion that the Corporation could succeed in getting some bids for the stall. The highest bid that the Corporation, however, received was only of Rs. 80. The person who offered that bid was eventually put in possession as from October 1, 1960, and the Corporation started recovering the rent of Its. 80 only from that person. The Corporation claimed that by reason of the petitioner having committed a breach of the terms of the licence and abandoned the possession of the premises while the licence was in force, it had sustained a total loss of 1,100 and presented a bill to the petitioner for the payment of that, amount. It wan against that bill that, the petitioner filed the appeal to the Municipal Commissioner as stated above. The Municipal Commissioner dismissed that appeal. It is against that order of dismissal that the petitioner has filed the present petition to this Court.

4. In support of this petition, it was urged by Mr. Mandlekar on behalf of the petitioner that the claim made by the Corporation against his client could not he recoverable under any of the provisions of the City of Nagpur Corporation Act, 1948 (No. II of 1950), and the only way in which the amount claimed by the Corporation could be recovered was by way of a civil suit. Ho invited our attention to Section 154 of the Act and urged that the amount sought to be recovered on account of compensation by the Corporation from his client was neither an amount 'declared by or under the provisions of this Act to be recoverable... or payable on account of any tax'. Mr. Hajarnavis, on the other hand, invited our attention to Section 374 of the Act and urged that the claim of the Corporation fell within the purview of that section and that, accordingly, the Corporation was entitled to recover that amount by attachment and sale of the petitioner's property as provided in the Act itself.

5. Section 374 of the City of Nagpur Corporation Act runs as follows:

In any case not expressly provided for in this Act or in any rule or bye-law made thereunder, any sum due to the Corporation on account of any charge, cost or costs, expenses, fees, rates or rent or any other account under this Act or under any such rule or bye-law, shall be recoverable; by distress and sale of the movable property of the person from whom such sum is due, in the manner provided by Chapter XII.

This section deals with recovery of certain dues by the Corporation which have not been expressly provided for in the Act or in any rule; or bye-law made thereunder. But the dues referred to in the section are in, the nature of any sum 'on account of any charge, cost or costs, expenses, fees, rates or rent or any other account under this Act or under any such rule or bye-law'. The question that we have, therefore to consider is whether the claim for rent and compensation which has been made by the Corporation against the petitioner in this case falls under any of these heads. Now, it cannot be disputed and it was not disputed by Mr. Hajarnavis at the bar that the amount claimed by the Corporation in the present case was not either in the nature of any charge, cost, expenses, fees or rates. A part of the claim, however, refers to the rent due from the petitioner for a period of the licence, and the rest of the amount is due as and by way of compensation, being the difference between the rent which was agreed to be paid by the petitioner and the rent which was likely to be actually recovered from the new occupant of the stall. Mr. Mandlekar urged that though part of the claim was in the, nature of rent and part in the nature of compensation, no such claim for rent, much less the claim for compensation, fell within the purview of Section 374, because, according to him, neither the rent nor the compensation was due to or recoverable by, the Corporation under the Act. We are afraid, we cannot accept this contention, because, in our opinion, the amount that became recoverable from the petitioner was traceable to a transaction which the Corporation had entered into in regard to its own property, and that the Corporation had power to enter into this particular transaction in regard to the property which was owned by it is clear from the wording of Section 8 of the Act which is as follows:

The Corporation shall have power to acquire and hold property, both movable and immovable, within or without the limits of the City, and subject to the provisions of this Act and the rules made thereunder, to transfer any property held by itself and to contract and to do all other things necessary for the purposes of this Act.

This section empowers the Corporation to acquire and hold movable and immovable property and also to deal with it in such manner as may be permitted by law. It was not disputed by Mr. Mandlekar on behalf of the petitioner that the stall in question belonged to the Corporation and that it had power, like any other individual, to deal with it by virtue of the provisions of Section 8 of the Act. But he urged that the licence, which was granted by the Corporation to his client in this case, was not a transfer of any property in the sense in which it is understood with reference to the provisions of the, Transfer of Property Act, and that, therefore, the money recoverable by the Corporation, from his client did not fall within the purview of Section 374 of the Act, Mr. Mandlekar, however, overlooked the words in that section 'and to contract and to do all other things necessary for the purposes of this Act.' Although a licence of immovable property may not amount to a transfer within the meaning of the Transfer of Property Act, it nevertheless amounts to a contract whereby a right is given to the licensee to use and occupy the premises which are the subject-matter of the licence. In so far as, therefore, a licence is a contract, it amounts to a transaction entered into by the Corporation in exercise of its power under Section 8 of the .Act. It is undoubtedly true that the contract referred to in this section has not to comply with the provisions of Section 63 of the Act, which provides for the manner in which the contract, which the Corporation is authorised to make can be made. The licence in this particular case, it was not disputed, is in accordance; with the provisions of Section 63 of the Act. Accordingly, we have no hesitation in holding that the licence by which the petitioner held the stall on a monthly rent of Rs. 158 from the Corporation amounted to a contract by the Corporation in exercise of its power under Section 8, and, therefore, whatever amount might become due to the Corporation by virtue of the terms of that contract would certainly be the amount due on 'any other account under this Act' as used in Section 374 of the Act. The terms of the licence provided that the licensee, i.e. the petitioner, had to pay Rs. 358 per month for the use and occupation of tho stall. It was only within a very short time after he took the stall licence that the licensee ('hose to abandon it. Clause 2 of the licence, however, provided that in that: event the licensee shall be liable to compensate the Corporation, for whatever loss it might suffer by virtue thereof. It is on this basis that the Corporation has made a claim of Rs. 1,100 against the petitioner. In our opinion, it is a claim for a sum of money which became due to the Corporation on account and in respect of a transaction which was duty authorised under the Act and properly recoverable under Section 374 of that Act.

6. We may mention that this point, was not urged before the Municipal Commissioner and the appeal before him was dismissed merely on the ground that there was no substance in the contention raised before him that the petitioner was not liable to pay any rent subsequent to the date on which he handed over the possession of the premises to the Corporation.

7. The question of the quantum of the bill which is presented to the petitioner was not disputed before the Municipal Commissioner nor has it been disputed before us. For the reasons stated above, we are of opinion that the amount claimed by the Corporation under its bill dated September 21, 1.9(30, was perfectly justified under the provisions of the City of Nagpur Corporation Act and that the Corporation had full authority to recover the amount of the bill by such process as has been permitted to it under the provisions of the Act. The petition is, therefore, dismissed. No order as to costs.


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