2004 (1) TMI 96 - SC - Indian Laws

Whether a cross-objection as contemplated by Order 41 Ruse 22 of the Code of Civil Procedure 1908 is at all maintainable in a civil appeal by special leave under Article 136 of the Constitution in this Court? Held that - If the judgment of the High Court was partly against the respondent it was for it to have filed an application seeking leave to appeal. That right having been foregone by it and the period of limitation having expired the cross-objections cannot be entertained. The filing of cross-objections by a respondent in this Court is an attempt at exercising the right of filing an application for special leave to appeal after the expiry of limitation and in a manner not contemplated by Article 136 of the Constitution. The judgment of the High Court was delivered on 1-8-2000. Leave was granted to the appellant on 13-8-2001 in the presence of Counsel for the respondent. Formal notice of lodgment of appeal was served on the respondent on 28-9-2001. The application by way of cross-objections has been filed on 31-7-2002. The only reason assigned in the application seeking condonation of delay is that though the respondent-Trust had accepted the judgment of the High Court it was advised and persuaded to file cross-objections because of the appellants having filed the application seeking leave to file an appeal and leave having been granted to them. We do not think such explanation in the facts and circumstances of the case amounts to sufficient cause for condoning the delay. Even on merits we do not find any reason to entertain the plea sought to be urged in cross-objections. As we have already pointed out the respondents have accepted the judgment of the High Court and also acted thereon. Merely because the other party has preferred an appeal that cannot be a ground for the respondent also to disown that part of the judgment which was acceptable to it. Further the issue which is now sought to be re-agitated stands concluded by the earlier order of remand passed by this Court. The respondent cannot now in the second round of appeal to this Court be permitted to urge such pleas as it could have urged in the earlier round or which it urged and was not accepted by this Court. The cross-objections preferred by the respondent-Trust are dismissed as not maintainable and as also being devoid of any merit.

Summary

Issues Involved:
1. Status of the Bombay Port Trust (BPT) as a landlord.
2. Maintainability of cross-objections by BPT.
3. Grievances of individual lessees.
4. Relief to which the parties are entitled.

Detailed Analysis:

1. Status of the BPT as a Landlord:
The BPT is an instrumentality of the State and hence an 'authority' within the meaning of Article 12 of the Constitution. Consequently, it must act in accordance with Article 14, ensuring that its actions are not arbitrary or capricious. The BPT, while being an owner-cum-landlord, must balance the need for revenue with fairness and reasonableness in its dealings with lessees. The BPT can revise rents to compensate for inflation and maintenance costs but cannot indulge in rack-renting or profiteering. The Court emphasized that the BPT's actions must align with public good and the objectives for which it exists.

2. Maintainability of Cross-Objections by BPT:
The Court ruled that cross-objections are not maintainable in an appeal under Article 136 of the Constitution. The BPT's attempt to file cross-objections was seen as an exercise of the substantive right of appeal, which is not permissible in this context. Additionally, the BPT had already accepted the judgment of the High Court and acted upon it, making it inappropriate to challenge the compromise proposals at this stage. The Court concluded that the cross-objections were devoid of merit and dismissed them.

3. Grievances of Individual Lessees:
The Court acknowledged the grievances of individual lessees, particularly those with unique circumstances such as J.H. Wadia, whose property had specific adversities. The Court directed that lessees with legitimate grievances could file representations for consideration. A retired judge would be appointed as an adjudicator to examine and decide on these representations. The adjudicator's decision would be final and binding, ensuring that individual hardships are addressed without reopening the entire controversy.

4. Relief to Which the Parties are Entitled:
The Court modified the compromise proposals to set the rates of return at 10% for non-residential uses and 8% for residential uses, instead of the originally proposed 15% and 12%. The interest on arrears of rent was capped at 6% per annum. The Court directed that lease deeds consistent with the modified compromise proposals be executed within eight weeks. The applicability of the Maharashtra Rent Control Act, 1999, to the BPT was left open for future determination. The Court also provided a mechanism for resolving individual grievances through an adjudicator, ensuring that the overall settlement is fair and reasonable.

Conclusion:
The Court's judgment balanced the need for the BPT to generate revenue with the requirement to act fairly and reasonably towards its lessees. By modifying the compromise proposals and setting up a mechanism for addressing individual grievances, the Court aimed to bring a fair resolution to the long-standing dispute. The decision emphasized the importance of public good and constitutional principles in the actions of state instrumentalities like the BPT.