Delhi High Court: In a suit filed by the Union of India (‘UOI’) against Express Newspapers Ltd., a publisher of various newspapers and magazines including Indian Express, regarding the premises leased to them i.e., Plot Nos. 9-10, Bahadur Shah Zafar Marg, New Delhi 110002 (‘suit property’), a Single Judge Bench of Pratibha M. Singh, J. dealt with multiple issues regarding the lease as well as the notices served upon Express Newspapers and held that the UOI could not be permitted to re-agitate issues which had already been raised and decided by the Supreme Court in 1985.
Background
Initially, Express Newspapers were allotted plot nos. 1 and 2 which were close to the Tilak Bridge, ITO, New Delhi. It was averred that due to a specific request made on behalf of Pandit Nehru (the then Prime Minister), Mr. Ram Nath Goenka, the founder of the Express Newspapers, surrendered plots nos. 1 and 2 and as an alternative, the present plots were allotted.
The intended lease agreement for plots 9 and 10 was executed and the agreement for the lease was entered on 26-05-1954. An underground sewer pipeline was discovered during construction which resulted in a change in the construction that was planned for the building and a revised allotment was made. The terms of the revised allotment dated 11-04-1956 were that the building line should be 25ft. away from the east side of the Central line of the sewer.
As per the revised lease deed dated 11-04-1956 read with 14-05-1956 and 19-05-1956, 2965 sq. yd. to the east of the pipeline was marked for construction of the building, and 2740 sq. yd. to the west of the pipeline was to be maintained as open space.
After the construction of the building, a perpetual lease deed was executed in terms of the revised allotment on 17-03-1958 wherein certain restrictions were stipulated which required that the suit property would not be used for any other purpose apart from newspaper press and certain residential flats. However, by then, permission was sought by Express Newspapers to use the building and surplus area for general commercial purposes.
On 15-01-1960 and 23-02-1960, permanent change of purpose was permitted in respect of 1 lakh sq. ft. out of the total 1.50 lakhs, subject to payment of an additional premium at 3,75,000/- per acre. However, as per the Land and Development Office (L&DO), formal permission was still required from the Ministry to which Express Newspapers did not agree. L&DO raised various demands in 1962 which, as per Express Newspapers, stood paid.
The supplemental lease deed which recognized the use of 1 lakh sq. ft. for general commercial purposes was executed on 17-11-1964. On 25-10-1977, Express Newspapers applied to the Ministry of Works and Housing for shifting of the sewer pipeline to make the land located west of the drain to be made usable as they wanted to start a Hindi newspaper and inter-connect the proposed building with the existing one. It was requested that the plot should only be treated as a commercial complex vide letter dated 31-12-1977.
Express Newspapers approached the Delhi Water Supply and Sewage Disposal (‘DWSSD’) and agreed to reimburse them along with the Municipal Corporation of Delhi (‘MCD’), the actual cost of reconstruction of drainage and shifting thereof.
Further, Express Newspapers sought approval for construction of a five-storied building as per the original plan. A three-member committee from the Ministry permitted construction after inspection, subject to diversion of the sewer line. The Urban Arts Commission also approved the same. On 11-09-1978, the Ministry of Works and Housing, L&DO directed Express Newspapers to pay damages for unauthorized construction on the suit property.
On 04-11-1978, DDA sanctioned a Floor Area Ratio (‘FAR’) of 360, and printing machinery was permitted to be installed in the basement. The Ministry of Works and Housing wrote to the DDA and confirmed that the said FAR would be allowed excluding the basement area.
Express Newspapers contended that during this entire period, the Ministry of Works and Housing as well as the LDO were kept duly informed and the letter dated 25-10-1977 by which they had applied for diversion of sewer and change of user, was sent to the L&DO. However, when a new government took over after the general elections in January 1980, an attempt to re-enter the building was made by the then government, which was stated to be in contravention of clauses 2(14) and 2(5) of the lease deed.
The re-entry notices dated 07-03-1980 and 10-03-1980 were challenged before the Supreme Court under Article 32 of the Constitution. These notices were held to be impinging upon the Fundamental Rights guaranteed under Article 19(1)(a) and (g) of the Constitution, and that the action taken by the then government was mala fide and politically motivated. As per the decision of the Supreme Court, the UOI could file a civil suit, which led them to file the present suit and thereafter, a counter-suit was filed by Express Newspapers.
Based on the premise that Justice Sen’s opinion in the Supreme Court’s decision wherein it was stated that the lessor was entitled to enforce his claim for recovery of conversion charges, a show cause notice was issued by the Ministry of Urban Development on 01-08-1986 which listed out various alleged violations committed by Express Newspapers. In its reply, Express Newspapers said that the stand of L&DO was baseless and sought clarification as to how such a claim could be enforced without filing a suit.
Thereafter, letters were exchanged between the parties, and a press report appeared in the Times of India on 15-11-1987 which stated that the UOI had taken over the Express building after issuance of notice. Express Newspapers informed the Government that no letter was served, to which the Government replied that it had filed the present suit.
The UOI, vide letter dated 02-11-1987, expressed its intent to re-enter the premises. L&DO, vide letter on the same date, informed the tenants of Express Newspapers that it had re-entered the premises w.e.f. 29-09-1987 given various alleged breaches and asked them to pay the rent.
The suit filed by the UOI was registered and summons was issued on 20-11-1987. In the suit filed by Express Newspapers, the summons was issued on 07-01-1988. In the interim application filed by Express Newspapers, it was observed that the main question raised was whether the judgment of Justice Sen was a minority judgment or would it constitute the ratio of the Supreme Court.
In the order for the interim applications, the Court, after considering that Express Newspapers was in possession as a lessee and had constructed the building at its own expense, felt that their benefits for the last several years could not be denied and stayed the impugned notice dated 02-11-1987. In a bunch of applications filed by the sub-tenants, an order dated 18-12-1989 was passed that permitted the tenants to continue paying the rent to their landlord — Express Newspapers.
Both the orders were challenged before a Division Bench of the Court which vide Order dated 24-08-1994 left the matter to be decided by the Trial Court. Thereafter, on 05-11-2001, issues were framed and the two suits were consolidated on 03-05-2007.
Analysis and Decision
The Court found it important to resolve the issue regarding the nature of the decision of the Supreme Court as to whether it was a unanimous decision or was it a decision rendered 2:1. The Court stated that it was a settled legal position that High Courts were not to go into the question as to the majority or minority view because both views would be binding under certain circumstances.
The Court referred to Prem Prakash Gupta v. Union of India 1977 SCC OnLine All 178 wherein it was held that if the majority of the Judges of the Supreme Court do not examine a particular issue and decide a case on certain grounds, then on that issue, if the minority expresses an opinion, the same would have a binding force on the Courts in India.
Thus, the Court opined that the decision delivered by the three Judge Bench of the Supreme Court was a binding decision under Article 141 of the Constitution, and it was not only binding on the Court but also on all the other governmental authorities. It was noted that there was no dissenting view and as per the leading judgment of Justice Sen, the then government had contemplated a legislation to provide a forum for adjudication of such disputes, which did not materialize and thus, the parties were relegated to a civil suit.
The Court said that failing all of the options for providing a forum or resorting to arbitration, the Government had the option to file a duly constituted suit to realize the conversion charges and additional ground rent. No other liberty was given to the UOI and a mandatory injunction was passed against them.
To answer the issue related to whether the plaint had been filed and verified and that the suit was instituted by a duly authorized person, the Court perused the official notifications which showed that R.P.S. Pawar, who filed the suit, was a duly authorized and competent person to file the plaint on behalf of the UOI.
Issue nos. 2, 3, 4, 7, 8 and 9 were related to the question as to whether there had been any breach of the perpetual lease deed dated 17-03-1958 and supplementary lease dated 17-11-1964 by Express Newspapers. Additionally, a question arising in these issues was whether the notices issued by the UOI were valid in law.
On the issue of a portion of the basement in the old building being used for newspapers instead of the permitted use as storage, the Court found it relevant to point out that vide letter dated 25-10-1977, Express Newspapers had sought permission for additional construction in the open space which was initially permitted due to the sewer line.
The Court noted that the additional basement space was required for starting a Hindi newspaper and Express Newspapers was given permission to inter-connect the new and the old building. The Court stated the fact that the basement was excluded from the sanctioned FAR was confirmed by two letters dated 24-11-1978 and 01-12-1978 addressed by the Ministry of Works and Housing to the DDA with copies marked to Express Newspapers. The Court opined that these communications were sufficient to hold that the construction and use of the basement for newspaper and machinery use was fully permissible.
Further, on the question of unauthorized construction, the Court noted that the entire construction was carried out after obtaining the requisite permissions. It was also noted that vide letter dated 09-06-1978, it was clarified that FAR beyond 300 would not be permissible, but once the sewer line was diverted, Express Newspapers would get an additional area of 54,000 sq. ft. and the DDA finally, vide letter dated 04-11-1978, allowed an overall FAR of 360 and called for the sanction plan. Thus, the Court held that the allegation that no construction could take place on the western side of the plot was not tenable.
On the question of construction of additional building in the area that was to be kept vacant, the Court said that the documents on record clearly showed that the requisite approvals for construction were obtained from the MCD. The Court noted L&DO’s stand wherein it was contended that the plans that were sanctioned by the MCD were not submitted to them or the Ministry and the construction was carried out without payment of additional premium and additional ground rent.
The Court said that the contention of L&DO was devoid of any merit because the authority for sanctioning of plans was MCD and the sanctioning of plans and FAR was known to the Ministry as the agencies concerned had informed the Ministry. Moreover, the Court stated that, since the Ministry and L&DO had complete knowledge of the construction if any charges were to be paid, a demand could have been raised contemporaneously.
Thus, the Court stated that it could not be said that the construction in the vacant space was unauthorized and in violation of the perpetual lease deed. The Court also said that the alleged breaches as per the notice dated 01-08-1986 were not made out from the record.
The Court stated that a very disturbing feature of the suit was that all the issues that had been considered and decided in the Judgment of the Supreme Court dated 07-10-1985, were again being reiterated and raised in the impugned notices. The Court said that re-agitating already adjudicated issues in the manner sought to be done by issuing fresh notices of termination would be in total disregard of the Judgement of the Supreme Court which had already gone into all these issues.
The Court noted that after the decision of the Supreme Court, there were only two courses of action for the UOI — to raise demand for the conversion charges and for the additional ground rent along with any reasonable interest, and upon failure to pay the same, to file a suit. Thus, the Court held that the allegation that there was unauthorized construction contrary to the building plans of MCD was not liable to be entertained.
The Court noted that the Supreme Court concluded that the notices dated 01-03-1980 and 10-03-1980 were not issued bona fide and that these observations would squarely apply even to the notice dated 02-11-1987. Thus, the Court held that the said notices were held to be arbitrary and mala fide.
On the question of whether the action of UOI to issue the notice dated 29-09-1987 or 02-11-1987 was barred by res judicata, the Court said that the mere fact that permission was granted by the Supreme Court for filing of a civil suit for the conversion charges and additional ground rent could not mean that the UOI was permitted to raise all the issues once again by way of a civil suit. The Court stated that in Daryao v. State of U.P. 1961 SCC OnLine SC 21, it was held that decisions in writ petitions would also bind the parties as res judicata though evidence may not have been led.
The Court held that considering the settled legal position, the UOI could not be permitted to re-agitate issues already raised and decided by the Supreme Court in its 1985 decision.
On the question of whether the action of the UOI in terminating the lease deed dated 17-03-1958 and filing the present suit was barred by estoppel, the Court stated that just because a supplementary lease deed was not entered into could not mean that the UOI was not bound by its decisions. It was also said that whenever permission is accorded by the Government, irrespective of whoever is in power, the same would bind even subsequent governments.
The Court said that in such cases, the doctrine of promissory estoppel would apply, and where the Government of India makes a promise that is not contrary to public interest or in violation of law, to any person/organization, they cannot refuse to abide by the same. While deciding the issue in favour of Express Newspapers, the Court said that merely because the L&DO may not have executed the supplementary lease deed did not render the construction illegal or unauthorized.
To answer the question as to whether UOI was entitled to recovery for possession of the suit property, the Court said that because the Court had held the notices by which the lease was terminated to be contrary to law and also contrary to the decision of the Supreme Court, the UOI was not held to be entitled to possession of the suit property.
The Court stated that the only amounts payable by the Express Newspapers would be conversion and additional ground rent. The Court opined that the computation filed by the UOI was far-fetched, unreasonable, and aggravated, and after being repeatedly queried, the amount had been reduced to Rs. 765 crores from the initial amount of Rs. 17,504 crores.
The Court itself computed the amount and held the conversion charges to be paid by Express Newspapers to be Rs. 4,67,572.8/- and the total amount payable towards additional ground rent was Rs. 24,44,402/-. The additional ground rent to be payable was computed to be Rs. 34,91,032/- and the simple interest to be payable to the L&DO was calculated at 18% p.a. for 46 years. Thus, the gross amount was Rs. 64,03,007.44/-.
Further, the Court stated that Express Newspapers may apply for conversion of the land from lease-hold to free-hold within four weeks and directed the Government to process and decide the same by 31-12-2024.
Lastly, considering the fact that this litigation had been long drawn even after the decision of the Supreme Court and that the Government sought to terminate the lease and issue notices for re-entry which were illegal and invalid, the Court decided to award cost of Rs. 5 lakhs to Express Newspapers which was to be paid within a month.
[Union of India v. Express Newspapers Ltd., 2024 SCC OnLine Del 6041, Decided on 30-08-2024]
Advocates who appeared in this case :
For Plaintiffs — CGSC Kirtiman Singh, Advocate Aryan Agrawal, Advocate A. Subba Rao, Advocate A.T. Rao, Advocate Meera Bhatia
For Defendants — Sr. Advocate Salman Khurshid, Sr. Advocate Sandeep Sethi, Sr. Advocate Amit Agarwal, Advocate Bhawani Gupta
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