DATE OF JUDGEMENT: 01st March, 2021
JUDGES: Hon’ble Mr. Justice R.F. Nariman & Hon’ble Mr. Justice B.R. Gavai
PARTIES: PUNALUR PAPER MILLS LTD (Plaintiff)
WEST BENGAL MINERAL DEVELOPMENT AND TRADING CORPORATION LTD. & ORS (Respondent)
SUBJECT: The property in question was the entire second floor admeasuring 7,500 square feet at Linsday street, Kolkata which was requisitioned under the West Bengal Premises Requisition And Control (Temporary Provisions) Act, 1947 in August 1973 to WBMTDCL.
AN OVERVIEW
(i) The property in question was the entire second floor admeasuring 7,500 square feet at Linsday street, Kolkata which was requisitioned under the West Bengal Premises Requisition And Control (Temporary Provisions) Act, 1947 in August 1973 to WBMTDCL. Pursuant to certain judgments of this Court, section 10B was inserted in the West Bengal Requisition Act by way of an amendment on 31.03.1987
(ii) In March 1987, Section 10B was inserted in the Act. As a result of the operation of Section 10B of the West Bengal Requisition Act, any property requisitioned under the Act had to be released by the State Government on or before the expiry of a period of 25 years from the date of requisition. For the Premises, this 25-year period ended in August, 1998, obligating the State to release the Premise.
(iii) However, instead of vacating the premises, after the expiry of 25 years, the premises were sought to be acquired for the "public purpose" of providing the permanent office accommodation to WBMDTCL in September 1999. This was sought to be done by issuing a notification under Section 4 of the Land Acquisition Act, 1894.
(iv) The notification was challenged in Calcutta High Court. A single-judge bench on June 22, 2000, ordered vacant possession of the premises to be handed over in three months.
(v) The petition was kept alive to determine compensation. However on the same day, the same order was vacated as the State issued another notification concerning the same property, this time invoking the urgency provision under section 17(4)
(vi) In 2017, a single-judge Calcutta High Court struck them down all those notifications and ordered that vacant possession be handed over to the owner in three months.
(vii) On appeal, the Division Bench of the High Court directed that the property should be vacated and possession should be handed over to Punalur Paper Mills within three months
(viii) It was also directed that the Chief Judge, City Civil Court at Calcutta should assess the compensation / rent / occupational charges for the period of August 16, 1998 till the date on which possession of the property is made over to Punalur Paper Mills.
IMPORTANT PROVISIONS
West Bengal Requisition Act
- Section 10B- Notwithstanding anything contained in section 10 or section 10A, the State Government shall release from requisition any property requisitioned or deemed to be requisitioned under this Act on or before the expiry of a period of twenty-five years from the date of such requisition: Provided that the benefit of this section shall not be available until after the expiry of a period of five years from the date of coming into force of the West Bengal Premises Requisition and Control (Temporary Provisions) (Second Amendment) Act, 1986.”
Constitution of India
- Article 12 - Definition In this part, unless the context otherwise requires, the State includes the Government and Parliament of India and the Government and the Legislature of each of the States and all local or other authorities within the territory of India or under the control of the Government of India
ISSUES
The Supreme Court on Monday took a very grim view of a West Bengal government body retaining unlawful possession of a property in Kolkata for the last 22 years without "paying a single pice towards compensation" (Punalur Paper Mills Limited v. West Bengal Mineral Development and Trading Corporation).
ANALYSIS OF THE JUDGEMENT
- The top court held that West Bengal was on notice from March 31, 1987, when section 10B was inserted in the West Bengal Requisition Act, that the premises would have to be released on or before August, 1998.
- This gave the State the time of 11.5 years to act and acquire the premises and such acquisition could easily have been done by way of a notification under section 4 of the Land Acquisition Act before the lapse of the 25-year period, the Supreme Court noted.
- But it failed to do so. Subsequently, long after the requisition period elapsed on August 15, 1998, the State issued a notification under Section 4 of the Land Acquisition Act, without invoking any urgency provision
- Later, it invoked urgency provision after the June 2000 order of single-judge. "To then say that the urgency provision could be invoked on account of the Single Judge’s order dated 22.06.2000, is to attempt to infer from the said order, much more than it actually said. Therefore, the Division Bench rightly held that at best this order could possibly refer to the acquisition proceedings that had already been initiated by the notification of 12.08.1999 under section 4 of the Land Acquisition Act. In any case, this order could not and did not wash away the lethargy of the State in initiating acquisition proceedings, which ought to have been done before the 25-year period elapsed," the Court held
- The Court the proceeded to address the claim of compensation made by the appellant, Punalur Paper Mills.
- It noted that the disturbing feature of the appeals was that a government body which fell within the definition of State was retaining unlawful possession of property for the last 22 years without paying any money.
- It, therefore, appointed retired Calcutta High Court judge, Justice Soumitra Pal to act as an arbitrator to decide compensation payable to Punalur Paper Mills.
- A written authority to appoint such arbitrator is to be furnished to us immediately, i.e., within a week from 23.02.2021. If not so furnished, WBMDTCL will be liable to pay a sum of Rs. 100 per square foot, per month for the entire period of illegal occupation of the Premises within four months from the date of this judgment," the top court directed
- The apex court also ordered WBMTDCL to hand over the possession of the premises to the appellant within 4 months
- Same directions were passed against West Bengal Sugar Industries Development Corporation Ltd. which was found to be in illegal occupation of a portion of the fifth floor of premises
CONCLUSION
On Monday, a very disturbing feature of these appeals is the fact that WBMDTCL, which is “State” within the meaning of Article 12 of the Constitution of India, has continued in unlawful possession of the Premises since 15.08.1998 without paying a single piece towards compensation till date. The court appointed Shri Soumitra Pal (Retd. Judge, High Court of Calcutta) as arbitrator to determine compensation that is payable by way of damages for occupation of the Premises without any authority of law. A written authority to appoint such arbitrator is to be furnished to the court immediately, i.e., within a week from 23.02.2021. If not so furnished, WBMDTCL will be liable to pay a sum of Rs. 100 per square foot, per month (being the average of the rental amounts paid by other tenants in the same building since August 1998 as per the Valuation Report dated 30.11.2019 prepared by Banibrata Mukherjee, Chartered Engineer, Engineer Commissioner & Valuer of Alipore Judges’ Court) for the entire period of illegal occupation of the Premises within four months from the date of this judgment. If written authority for appointment of the arbitrator is received within time, the learned arbitrator is to proceed on a prima facie view of the case submitted to him by the parties to determine interim compensation payable within a period of two months of entering upon the reference. This is owing to the fact that not a single piece has been paid for the last 22 years for the illegal occupation of the Premises by WBMDTCL. Further, neither party is to take any adjournment before the arbitrator within this period of two months, so that the arbitrator can decide the interim compensation that is to be paid. After such interim order, the learned arbitrator will proceed to deliver a final award.
WBMDTCL has asked for reasonable time to vacate the premises. However, in light of the fact that WBMDTCL has been in possession of the Premises without any authority of law for the last 22 years, we do not feel that it is justified to give time as prayed for, till the end of this year. Thus, we only grant time of four months from the date of this judgment to vacate the Premises, conditional upon the responsible officer filing an undertaking before this Court, that they will vacate the Premises within four months and handover vacant possession of the Premises to the Appellant, and that the interim compensation, if ordered before such date, will be paid within the time stipulated by the arbitrator so appointed.
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