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TMI Blog2024 (5) TMI 1512X X X X Extracts X X X X X X X X Extracts X X X X ..... ewal. First, for a permission to qualify as a "renewal", such renewal has to occur before the expiry of the previous permission, or at least within a reasonable time immediately thereafter. There is a distinction between renewal and novation. The moment a previous permission expires, it ceases to exist and there cannot be any "renewal" of the same. Anyway leave permission granted thereafter would be new contract/permission - The impugned way leave permission has been given specifically for repairing and reviving and renewal of way leave permission to operate an underground pipeline and not any overhead structure. By no stretch of imagination can an overhead structure to be built over the railway lines be defined as an "underground pipeline". The "Clean Slate Theory" propounded by the Supreme Court and followed by several High Courts in respect of approved Resolution Plans under the IBC applies only to efface previous debts and liabilities of the Corporate Debtor, to enable the successful Resolution Applicant to revive the concern with a "clean slate". However, the said legal fiction cannot be doubly applied to generate another legal fiction of creation of new rights which is entir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... permission had been granted to the respondent no. 6 for a water-pipeline at 1.2 m depth on July 10, 2007 which was valid for ten years and expired in the year 2017. 3. Subsequent thereto, way leave permission was granted to the petitioner by the Railways on February 1, 2019 for a two-span underpass starting at the depth of 800-900 mm. 4. An agreement was entered into between the petitioner and the Railways for such underpass on February 27, 2019. As per Clause 25 of the said agreement, the underpass would be constructed in terms of the plan approved by the Railways, which was accordingly done. 5. Again, on June 2, 2022 a way leave permission was granted to the petitioner by the Railways for a one-span underpass starting also at the depth of 800-900 mm. 6. Pursuant to the same, on June 2, 2022 an agreement was entered into which had a similar Clause 25 as the previous agreement, which was also complied with. 7. It is relevant to mention here that according to both parties, the route of the underpass was approximately at right-angles with the water- pipeline which had previously been constructed by respondent no. 6 and the two crisscrossed each other manner. Accordingly, it is s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated October 4, 2002 issued by the Railway Board, by virtue of Clause 7.5.2 thereof, contemplates only existing way leave facility users to migrate to the policy. The purported renewal granted to the respondent no. 6 on April 3, 2024 is in terms of Clause 7.4 of the Policy and therefore such renewal could not have been granted, since the way leave permission of respondent no. 6 had already expired seven years ago in 2017. 13. Learned senior counsel for the petitioner next seeks to highlight the alleged mala fides of respondent no. 6 in requesting for depositing way leave permission fee from the financial year 2017-2018 to 2026-2027 for revival of a water line, suppressing that in the intervening period, much after the expiry of the earlier agreement, a right has been created in favour of the petitioner to build an underpass and it would be impossible for the pipeline to be made operational without interfering with such underpass, since the underpass crosses the route of the previously existing pipeline. 14. The application dated March 27, 2023 for revival of way leave permission suffers from such suppression. 15. In the agreement dated April 3, 2024 granted in favour of the resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ermitted the petitioner to construct its underpass along a route including a cross-section where the pipeline had previously existed. 21. The argument of the respondents that the petitioner has no locus standi to complain since its underpass will not be affected is refuted by the petitioner. Learned senior counsel for the petitioner argues that the effect of the purported renewal of license from 2017 to 2027 would directly interfere with the petitioner"s right to operate its underpass. 22. Regarding the contention that the Railway Engineering Code is only an administrative instruction and not binding, it is argued that the Railways have relied upon two Circulars dated April 24, 2014 and November 27, 2001 both of which reaffirmed the said Code and the clauses thereof. Moreover, in terms of Section 3 of the Railway Boards Act, 1905, any instruction of the Railway board has binding effect and is of statutory force. 23. It is further argued that the construction of the overhead pipeline proposed by the respondent no. 6 would directly jeopardize the underpass of the petitioner, since no specifics of the structure have been disclosed even in the plan relied on by respondent no. 6 and/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rmission or grant of new way leave permission. Clause 7.5.2, it is argued, does not provide that it would apply only to way leave permissions subsisting on the date of the Master Circular and does not take away the right of renewal of a previously expired way leave permission. 27. The Railway Code also does not prevent such grant of way leave permission. 28. Other factors also merit consideration such as, the respondent no. 6 already had an underground pipe system in place by virtue of its earlier way leave permission and the municipality had agreed to supply water by an agreement dated February 9, 2024 to respondent no. 6 for its plant and the drawings which had been approved would not affect the petitioner"s underpass in any manner. 29. Respondent no. 6 argues that Clause 1033(12) also does not stand in the way as in reality, the way leave permission was for underground pipelines and it was only where the underpass has been constructed by the petitioner that the pipeline would be overhead without there being any construction on the land, as demonstrated by the drawings handed over at the time of hearing. Moreover, both the Master Circular and the Railway Code are mere administ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent a previous permission expires, it ceases to exist and there cannot be any "renewal" of the same. Anyway leave permission granted thereafter would be new contract/permission. The said common-sense principal applies all the more in the present case, since the renewal sought to be granted is after a prolonged period of seven years, long before which the previous agreement has been given a decent burial. One cannot just come up after seven years and say that a dead permission, which had met its demise seven years back, is sought to be renewed. Thus, for all practical purposes, the description of a fresh way leave permission as "renewal" was nothing less than a fraud practised upon the petitioner in collusion between the Railway Authorities and the respondent no.6 as well as a fraud on the applicable Laws and Regulations. 37. There are several other discrepancies as well. Clause 1.3 of the Policy of Management of Railway Land, which is binding on the Railway Authorities, having the force of law since issued by the Railway Board and having been relied on by the Railway Authorities time and again, the said policy is applicable for the grant of lease/license/way leave permissions for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pass of the petitioner has to be crossed, which cannot but render the underpass totally unusable, rendering the valid and subsisting way leave permissions and agreements held by the petitioner nugatory. 40. In both the communications, as well as the agreement sought to be entered into with respondent no.6, the Railway Authority seeks to give out an impression, in tandem with the respondent no.6, that the permission was being given for reviving an underground water pipeline. The said attempt itself, evidently, is to bypass the effect of sub-clause (12) of Clause 1033 of the Railway Engineering Code, which provides that in all cases of way leave facilities (except ROBs/RUBs, and underground pipelines), no construction (whether permanent, quasi permanent or temporary) other than a kuchcha or pucca road in cases the facility is expressly given for the same, is to be permitted on railway land. If any such construction comes up subsequently, the same should be immediately removed as soon as noticed and the way leave facility discontinued with. 41. An ROB has been defined in the said Code as "Road Over Bridge" and RUB as "Road Under Bridge". The construction now sought to be made by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rnishes such alternative source of water, evidence regarding that, and as to whether use of such supply is a practical alternative, cannot be undertaken by the writ court. 46. Even apart from the same, however, in view of the above reasons, the effort in granting a fresh renewal of an expired lease is mala fide and de hors the provisions of the Master Circular of the Railway as well as the Railway Engineering Code and would be violative of the rights of the petitioner. 47. The other argument advanced by respondent no. 6 is that the petitioner is trying to frustrate the Resolution Plan which has been approved in connection with a CIRP initiated by the respondent no. 6. Clause 15.14(ii)(a) of the same provides that the Resolution Applicant prayed that upon approval of the Resolution Plan by the Adjudicating Authority and since the Resolution Applicant would acquire the Corporate Debtor on an going concerned basis, subsisting consents, licences, approvals, rights, entitlements, benefits and privileges shall be deemed to continue without disruption of the benefit of the Corporate Debtor. 48. The Resolution Process itself commenced on January 8, 2018 whereas the way leave permission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... veral occasions, as demonstrated by the petitioner, and in view of the fact that those have been adhered to at all material times by the Railways and are binding on them, the argument that those are not binding and may be flouted by the Railways at their sweet will cannot be accepted, more so at the behest of the respondent no. 6 where the Railways themselves have not gone to the extent of arguing so. 52. The failure of the petitioner in the Resolution Process has no bearing on the present dispute and as such, mala fides cannot be read into the resistance of the petitioner to an illegal attempt by the respondent no. 6 to create rights where there do not exist any. 53. The very attempt to package the unlawful grant of new way leave permission directly to the detriment of the rights already conferred in favour of the petitioner by the Railways as a "renewal" is itself mala fide and fraudulent, being detrimental to the Engineering Code of the Railway itself and the Master Circular. 54. The other aspect of the matter is that respondent no. 6 attempts to project that the overhead structure would not affect the rights of the petitioner in any manner. However, in view of the specific b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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