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TMI Blog2003 (10) TMI 673X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 of the said Act as well as the appellate judgment dated 22.7.1992 of the Additional District Judge confirming the order need to be set aside and quashed. The petitioner has also sought the quashing of the letter dated 2.9.1987 whereby the license in favor of the petitioner in respect of the premises in question was cancelled. 3. The petitioner was inducted as a licensee by the Respondents on 19.8.1975 by way of a License Deed executed on that date in respect of Shop No. 10, Asia House Market, New Delhi. Clauses 1, 2 and 8 of the said License Deed are as under: 1. The Licensee(s) shall be deemed to be bare Licensee(s) having only a personal right in the said premises and nothing herein contained shall be deemed to be a demise at law of the said premises or any part thereof so as to give the Licensee(s) any interest therein. 2. The license is purely temporary and the government reserve the right to revoke it at any time by giving thirty days notice without assigning any reason to the Licensee(s) of their intention to do so. xxxx xxxx xxxx xxxx xxxx xxxx 8. The Licensee(s) shall not permit the said premises or any part thereof being used by any other person for any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e confirming the said order of eviction the learned Additional District Judge made the following observations:- 8. In view of the above even if one is inclined to accept that it was only a technical fault and not a case of substantial sub-letting or misuse of the premises, this Court can not substitute its own view in place of the decision of the allotting Authority, in view of the decision in Dr. K. R. K. Talwar's case because the allotment has been cancelled. 9. No doubt, it would have been better if the premises were regularised in the name of the appellant and on the basis of technical fault, the appellant was not proceeded against but as this lies within the discretion of the Allotting Authority, this Court can not do anything else except dismissing the appeal in the present circumstances of the case. Consequently, I dismiss the appeal. Let a copy of this judgment be sent to the learned Estate Officer for information Along with the records. Appeal file be consigned to records. 5. The whole question Therefore, is whether the constitution of the said Company by the petitioner and user by it (ie., the company) of the said premises would amount to a violation of Cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m order passed on 5.1.1993 was as under:- Notice for 23rd March, 1993. Meanwhile, the impugned order is stayed subject to however after the arrears of license fee and/or damages are paid by the Petitioner. dusty as well. On 10.12.1993 the interim order made on 5.1.1993 was confirmed till the disposal of the writ petition. Liberty was however granted to the parties to seek variation of the order, if the circumstances so required and after the pleadings were completed. Thereafter, the respondents filed C. M. No 14197/99 for vacation of the interim order dated 5.1.1993 and 10.12.1993. Notice was issued to the Petitioner on this application on 20.12.1999. However, on 17.7.2000 counsel for both the parties prayed that rather than disposing of this application, the writ petition itself be taken up for hearing. Thereafter, the matter had been posted for final disposal and it was ultimately heard by this Court on 4.9.2003. In the said CM No.14197/99 as well in the Counter affidavit filed on behalf of the respondents it is stated that the eviction squad of the respondent finding that the shop in question was locked, sealed the same on 29.12.1992 and handed over its possession to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, there is no dispute that the said company (Romica World Travels [Pvt] Ltd) runs its business from the said shop. It does so, upon the permission granted by the petitioner (Licensee). But, without any previous written consent from the Licensor. To this extent, it does appear that the petitioner has contravened clause 8. However, the learned counsel for the petitioner submits that the said company is not any other person but the petitioner herself, if one were to remove the corporate veil. 9. I shall now examine the two cases cited by the learned Counsel for the petitioner. In Vishwa Nath v. Chaman Lal Khanna (supra), a single judge of this court held:- 22. If an individual takes the premises on rent and then converts his sole proprietorship concern into a Private limited company in which he has the controlling interest he cannot be evicted from the premises. On the proved facts, this is the inevitable conclusion. The person who took the premises on rent remains in possession though he forms a company and ceases to be the sole proprietor. He does not cease to be in possession. He has not parted with the possession with any one. He has changed the form of his business. In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re is no transfer of possession. In this context, it becomes clear that Vishwa Nath's case is not applicable to the facts of this case. The emphasis in that case was on the question of parting with possession. Here, we are not concerned with possession but with user. In terms of clause 8, this case is concerned with whether the shop has been permitted to be used by another person . On the face of it, the said company is a separate juristic person, different and distinct from the petitioner. The company has been permitted to use the shop by the petitioner. Therefore, clause 8 has been contravened, unless it can somehow be established that the petitioner and the said company are one and the same person. This aspect will be discussed a little later after I finish with the second case relied upon by the learned counsel for the petitioner. 10. M/s. Madras Bangalore Transport Company (West) (supra) is also a decision relating to sub-letting and would Therefore not be applicable to the situation at hand. The learned counsel for the petitioner also cited this decision to show that the Supreme Court had specifically approved of the decision of this court in Vishwa Nath's case (s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rine that the Corporation or a Company has a legal and separate entity of its own has been subjected to certain exceptions by the application of the fiction that the veil of the Corporation can be lifted and its face examined in substance. The doctrine of the lifting of the veil thus marks a change in the attitude that law had originally adopted towards the concept of the separate entity or personality of the Corporation. As a result of the impact of the complexity of economic factors, judicial decisions have sometimes recognised exceptions to the rule about the juristic personality of the corporation. It may be that in course of time these exceptions may grow in number and to meet the requirements of different economic problems, the theory about the personality of the corporation may be confined more and more. Similar observations were made by the Supreme Court in the case of New Horizons Ltd. v. Union of India: (1995)1SCC478 : 27. The conclusion would not be different even if the matter is approached purely from the legal standpoint. It cannot be disputed that, in law, a company is a legal entity distinct from its members. It was so laid down by the House of Lords in 1897 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r proceeded from those within and who hide behind the veil. Essentially, lifting of the veil has been permitted to prevent persons from taking refuge behind the veil and thereby take advantage of the separate juristic identity of the company. The doctrine has Therefore been employed by the courts to prevent persons from taking advantage of their wrongs using the corporate entity as a sheild. It cannot, Therefore, be employed for permitting the petitioner to take advantage of her wrong in not taking written consent of the Government before permitting the said company to use the said shop. If the corporate veil cannot be lifted, the inevitable conclusion is that the petitioner and the said company are separate and distinct persons. Consequently, user by the said company of the said shop in the facts narrated above would be in violation of the terms and conditions of the license and, in particular, of clause 8 thereof. Clearly, then, the cancellation of the license would be in order. The 'domino effect' would be that the order of the estate officer and ultimately the judgment of the Additional District Judge upholding the eviction of the petitioner would all be unassailable. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not permissible to go into such supposed reasons . These observations do not mean and, indeed, cannot mean that cancellation of a lease or license cannot be subjected to judicial review or that the Estate Officer cannot go into the question of validity of such cancellation in proceedings under the said Act. The learned counsel for the petitioner referred to a decision of a single judge of the Karnataka High Court in the case of Blaze and Central (P.) Ltd v. Union of India: AIR1980Kant186 and in particular to the following (para 13): The Act need not provide for all the minor details how an enquiry should be conducted by the Estate officer The Estate Officer must hold an enquiry as required under S. 4 of the Act, read with the Public Promises (Eviction of Unauthorized Occupants) Rules 1971. R. 5 of the Rules provides that the Estate Officer shall record the summary of the evidence before him and the summary of such evidence and any relevant documents filed before him shall form part of the of the proceedings. Exercise of the power under the Act is undoubtedly quasi-judicial. The petitioner has a right to be heard before the Estate Officer and if the right to be heard is to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er, shall, for the purpose of holding any enquiry under the said Act have the same powers as are vested in a civil court under the Code of Civil Procedure, 1908, when trying a suit in respect of the matters specified therein namely: (a) summoning and enforcing the attendance of any person and examining him on oath; (b) requiring discovery and production of documents; and (c) any other matters which may be prescribed. 34. Rule 5(2) of the Public Premises (Eviction of unauthorized Occupants) Rules, 1971, requires the Estate Officer to record the summary of evidence tendered before him. Moreover Section 9 confers a right of appeal against an order of the Estate Officer and the said appeal has to be heard either by the District Judge of the district in which the public premises are situate or such other judicial officer in that district of not less than ten years' standing as the District Judge may designate in that behalf. It shows that the final order that is passed is by a judicial officer in the rank of a District Judge. These observations were made in the backdrop of the question whether a lease has been determined or not. The Supreme Court did not hold that su ..... X X X X Extracts X X X X X X X X Extracts X X X X
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