2007 (1) TMI 546 - SC - Indian Laws

Whether the appellant is not entitled to exercise the option to acquire ownership of the demised industrial sheds and his claim in that regard is wholly baseless?

Summary

Issues Involved:
1. Applicability of the West Bengal Government Premises (Tenancy Regulation) Act, 1976 to industrial sheds.
2. Automatic termination of tenancy under Section 3(2)(i) of the Act.
3. Entitlement to ownership of industrial sheds after 30 years as per the lease deed.

Issue-wise Detailed Analysis:

1. Applicability of the West Bengal Government Premises (Tenancy Regulation) Act, 1976 to industrial sheds:

The appellant argued that the Act applies only to residential premises and not to industrial sheds, which are commercial in nature. The contention was based on the definitions of "premises" and "tenant" in Section 2(c) and (f) of the Act, and the use of terms like "house or an apartment" in Section 3(2)(ia). The appellant's counsel emphasized that the Act's language and structure indicate its application to residential buildings only.

Conversely, the respondent's counsel argued that the Act is comprehensive, covering all types of tenancies, including residential, commercial, and industrial. The Preamble and definitions within the Act do not restrict its application to residential premises alone. The Court agreed with the respondent, noting that the definitions of "Government premises" and "premises" are broad and inclusive, covering any building or hut, whether residential, commercial, or industrial. The Court also referenced the West Bengal Government Premises (Regulation of Occupancy) Act, 1984, which explicitly limits its scope to residential buildings, unlike the 1976 Act.

The Court concluded that the 1976 Act applies to all types of premises, including industrial sheds, rejecting the appellant's narrow interpretation.

2. Automatic termination of tenancy under Section 3(2)(i) of the Act:

The appellant's tenancy was terminated under Section 3(2)(i) of the Act due to a violation of lease terms. The Prescribed Authority issued notices, and upon non-compliance, the Corporation took possession of the industrial sheds. The appellant's subsequent writ petitions were dismissed by the Calcutta High Court.

The Court examined the findings of the Chairman of the Corporation, who confirmed that the appellant's unit was non-functioning and had been closed for a long period. The disconnection of electricity services in 1994-96 corroborated the non-functioning status. The Court held that there was a clear violation of the lease terms, leading to automatic termination of the tenancy under Section 3(2)(i) of the Act.

3. Entitlement to ownership of industrial sheds after 30 years as per the lease deed:

The appellant claimed entitlement to ownership of two sheds after 30 years, as per Clause VI(b) of the lease deed. However, the Court noted that Clause VI is subject to the covenants in the earlier part of the lease deed. Given the appellant's violation of clauses 2(f)1 and 3(B) of the lease deed, the Court held that the appellant could not claim ownership under Clause VI(b). The appellant's claim to ownership was deemed baseless due to the breach of lease terms.

Conclusion:

The appeal was dismissed with costs, affirming the termination of the appellant's tenancy and rejecting the claim to ownership of the industrial sheds. The interim order granted on 17.2.2006 was vacated.