2024 (5) TMI 923 - HC - Indian Laws

Maintainability of the writ petition against contractual dispute in the private law realm - money decree, adjudicated disputes, questions of fact - default to pay the rents revised as per their CPWD Norms - Single Bench directed the sum to be paid to the writ petitioners being the arrears of rent alleged to be payable to the writ petitioners - respondents/ writ petitioners contended that appellant department willfully defaulted to pay the rents revised from time to time as per their CPWD Norms and as per the orders and instructions given by the Income Tax Department and the learned Single Bench rightly took note of the factual position had allowed the writ petition - HELD THAT - The Court can exercise jurisdiction even in a private law realm subject to the caveats - See Puna Hinda 2021 (9) TMI 1548 - SUPREME COURT , Bharat Coking Coal Limited and Ors. 2020 (3) TMI 1465 - SUPREME COURT Adjudication of arrears of rent and related payments - Chief Commissioner of Income Tax fixed the rent at Rs. 34,302/- per month. This fixation was unilaterally not communicated to the writ petitioner which has been admitted by the department in affidavit-in-opposition. To be noted, that in spite of the direction issued in the earlier writ petition in the appellant department did not take any constructive steps to comply with the direction and to reasonably deal with the writ petitioners who are admittedly owner of the premises. Therefore, the learned Single Bench was right in observation that the department was delaying the matter for a prolonged period and failed to incorporate the revised CPWD rates as the quantum of rent for the building in question. As pointed out earlier and as well as rightly noted by the learned Single Bench all along the appellant department have acted on the basis of CPWD rates for assessing the rent for the premises in question. The circular issued in 1987 is also to the same effect and therefore the appellant department cannot deviate from such norms. There is no disputed question of fact and all that the hiring department was harping upon with regard to the CPWD rates. As noted by us above all along the department has been adopting the CPWD rates and they cannot make a departure at this juncture. There were five columns in the tabulated statement of which column A was the amount according to the recognized principle of valuation. Column B was according to the prevailing market rate of rent. Column C was the amount already received. The next column was A minus C i.e. the balance to be received according to principles of valuation and the last column being B minus C i.e. the balance to be received according to the market price of rent. The learned Single Bench rightly took note of the rent which was calculated according to the recognized principles of valuation and deducted the amount already received by the writ petitioners and the balance receivable was Rs. 2,82,39,242/- which has been directed to be paid by the department to the writ petitioners. Thus, we find that not only the writ petitioners/owners of the building were unfairly dealt for all these years, driven from the pillar to post and the department being the State ought to have dealt with its citizen/landlord in a better manner, that apart there is no dispute which requires any adjudication in the matter and therefore the writ petition was maintainable and rightly entertained by the learned Single Bench and the directions issued therein are sustainable in law.

Issues Involved: Maintainability of writ petition in contractual disputes, adherence to CPWD rates, unilateral rent fixation by the Income Tax Department, and entitlement to arrears of rent.

Issue-wise Detailed Analysis:

1. Maintainability of Writ Petition:
The primary contention raised by the Income Tax Department was that the learned Single Bench virtually passed a money decree by adjudicating disputed questions of fact and directing the payment of Rs. 2,84,39,242/- as arrears of rent. The Department argued that such a matter, being purely contractual and non-statutory, should not have been entertained under writ jurisdiction. However, the Court noted that the writ jurisdiction is a public law remedy and can be invoked even in private law realms if the complainant party establishes that the action or inaction of the State is arbitrary. The Court referred to the Supreme Court judgments in Union of India vs. Puna Hinda, Bharat Coking Coal Limited vs. Amr Dev Prabha, and M.P. Power Management Company Limited vs. Sky Power South-East Solar India Private Limited, which held that writ petitions can be maintainable in contractual disputes if there is no serious and genuine dispute regarding the liability of the State to make the payment.

2. Adherence to CPWD Rates:
The Court examined whether the Income Tax Department adhered to the CPWD rates for rent assessment. It was noted that the department had consistently acted based on CPWD rates for assessing the rent for the premises in question. The Central Public Works Department (CPWD) by office memorandum dated 30th January 1987, revived the hiring committee to issue the Reasonable Rent Certificate (CRR) for buildings hired by the department. The Chief Commissioner of Income Tax had fixed the rent at Rs. 34,032/- per month as recommended by the CPWD, which was accepted by the landlords. The Court found that the department could not deviate from these norms as they had been following CPWD rates all along.

3. Unilateral Rent Fixation:
The Court observed that the Income Tax Department had unilaterally fixed the rent without properly communicating or consulting the writ petitioners. The Chief Commissioner of Income Tax, Durgapur, had fixed the revised rent intervals and made observations regarding reimbursement of municipal taxes. However, the department's unilateral actions without reference to the writ petitioners and the lack of communication were deemed arbitrary. The Court found that the department did not take constructive steps to comply with the directions issued in the earlier writ petition (WP No. 4178 (W) of 2005).

4. Entitlement to Arrears of Rent:
The learned Single Bench had directed the payment of arrears of rent amounting to Rs. 2,84,39,242/-. The Court noted that the rent figures were not in dispute, and the details of the arrears were provided by the writ petitioners in a tabulated format. The Single Bench took note of the rent calculated according to recognized principles of valuation and deducted the amount already received by the writ petitioners. The balance receivable was Rs. 2,82,39,242/-, which was directed to be paid by the department. The Court found that the writ petitioners were unfairly dealt with for several years and that the department's actions were arbitrary, justifying the directions issued by the learned Single Bench.

Conclusion:
The appeal was dismissed, and the Court upheld the Single Bench's order directing the Income Tax Department to disburse the arrears of rent. The Court extended the time for compliance by two weeks from the date of receipt of the server copy of the order. The judgment emphasized that the writ petition was maintainable, the department's actions were arbitrary, and the writ petitioners were entitled to the arrears of rent as calculated based on CPWD rates.

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