1972 (5) TMI 71 - SC - Indian Laws

Summary

Issues:
1. Validity of lease deed and creation of tenancy
2. Apportionment of compensation between appellant and Corporation
3. Quantum of compensation for acquired land

Issue 1: Validity of lease deed and creation of tenancy:
The dispute arose regarding the validity of a lease deed executed for Plot No. 670 for locating and running a City College. The Collector assessed compensation, considering the appellant as a lessee for the specific purpose mentioned in the lease deed. However, the High Court held that the lease deed executed during the Corporation's superseded status was ineffective to convey leasehold interest. Despite this, the High Court recognized a tenancy by necessary implication, continuing based on the terms in the lease deed. The High Court found the renewal clause in the lease deed uncertain and vague, leading to a discussion on the enforceability of such a contract under the Indian Contract Act. The apportionment was made on an actuarial basis between the appellant and the Corporation.

Issue 2: Apportionment of compensation between appellant and Corporation:
The High Court, following a previous decision, held that the lease deed executed during the Corporation's superseded status was ineffective to convey leasehold interest to the appellant. However, the High Court recognized a tenancy by necessary implication, continuing based on the terms in the lease deed. The High Court found the renewal clause uncertain and vague, leading to a discussion on its enforceability. The High Court determined the apportionment between the appellant and the Corporation based on an actuarial basis in the ratio of 1038:962.

Issue 3: Quantum of compensation for acquired land:
The appellant raised concerns about the compensation awarded by the Additional District Judge, arguing that the renewal clause in the lease deed should have been considered. The Supreme Court noted the unnecessary debate on the renewal clause's scope and effect due to the lease deed's invalidity. The Court emphasized that the lease deed was null and void as the officer lacked the power to lease the property. The Court determined that the tenancy, in this case, could only be from month to month under Section 106 of the Transfer of Property Act. The Court further addressed the quantum of compensation, affirming that the High Court had considered all relevant factors while assessing the value of the acquired land, ultimately dismissing the appeals.

Conclusion:
The Supreme Court upheld the High Court's decision, emphasizing the invalidity of the lease deed due to the officer's lack of authority, leading to the creation of a tenancy by implication. The Court dismissed the appeals, affirming the apportionment of compensation and the assessment of the land's value by the High Court.