Dismissed

Kaushal Kishore Niranjan v. Hindustan Pet. Corpo. Ltd. and Others

Allahabad HC10 Dec 2018WRIC/33941/2008

Case brief

AI extract

What is this about?

The High Court refused to issue a No Objection Certificate to revoke an earlier 30-year lease agreement between the petitioner and Hindustan Petroleum Corporation. Relying on a Supreme Court precedent, the court held that lease remains subsisting even after dealership cancellation, and the corporation cannot revoke the lease merely by issuing an NOC or allotting the outlet elsewhere.

What did the court decide?

Petitioner's prayer for direction to issue No Objection Certificate for revocation of the lease was dismissed; amendment application also rejected.

Kaushal Kishore Niranjan Vs Hindustan… — Contract and Commercial Disputes | Allahabad HC (2018)

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Court No. - 39 Case :- WRIT - C No. - 33941 of 2008 Petitioner :- Kaushal Kishore Niranjan Respondent :- Hindustan Pet. Corpo. Ltd. And Others Counsel for Petitioner :- Hariom Tiwari Counsel for Respondent :- Vikas Budhwar,SC

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Hon'ble B. Amit Sthalekar,J. Hon'ble Piyush Agrawal,J.

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Heard Shri Hariom Tiwari, learned counsel for the petitioner and Shri Vikas Budhwar, learned counsel for the respondents.

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The petitioner in the writ petition is seeking a direction to the respondents to issue No Objection Certificate for revocation of an earlier agreement entered into between the petitioner and the Hindustan Petroleum Corporation Ltd. (hereinafter referred as the Corporation only) for setting up a retain outlet.

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Briefly stated the facts of the case are that the petitioner entered into a lease agreement with the respondent-Corporation for setting up a retail outlet. Copy of the agreement has been filed as Annexure 7 to the writ petition which shows that the lease which has been granted to the petitioner whereby lease of the premises Arazi/Chak No. 1269, Gata No. 1491 (0.458 Hectare), 1492 (0.118 Hectare), 1489 (0.003 Hectare) and 1503 (0.012 Hectare), total 0.618 Hectare in village Ramapura Jagir, Tehsil Madhogarh (Bangra0Jagmanpur Road) District Jalaun State of U.P. has been granted for a period of 30 years. On the basis of this lease a retail outlet was also established by the respondents. In the meantime the petitioner requested for resiting of the retail outlet and therefore another lease agreement was entered into between the petitioner and the Corporation dated 11.12.2006 lease of premises Arazi/Khata Khatauni No. 292, Gata No. 741 (0.345 Ha.), 742 (0.450 ha.), 743 (0.044 Ha.) Total 0.839 Hectare in Village Badagaon Tehsil Orai (Shivpuri Bhoganipur Road N.II.25) District Jalaun State U.P. for a period of 30 years.

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Now the contention of the petitioner is that since he is no longer using this land and his retail outlet has been re-sited, therefore, earlier agreement be revoked.

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Learned counsel for the respondents, on the other hand, submits that the agreement has been entered into between the petitioner and the Corporation and that once such agreement was entered into between the petitioner as lessor and the respondent as a lessee for a period of 30 years, No Objection Certificate cannot be given and the lease cannot be revoked on the basis of a NOC. It is always open for the petitioner to resort to appropriate legal proceedings for cancellation of the lease agreement. He

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further submits that grant of dealership and execution of a lease deed between the petitioner and the Corporation are quite different things and even in the eventuality that the dealership is cancelled, the lease continues to subsist in favour of the Corporation. Reference has been made to a judgement of the Supreme Court in the case of Rahul Yadav and another Vs. Indian Oil Corporation Ltd. and others reported in (2015) 9 SCC 447. We find that in that case also there was a long term lease of 30 years executed between the appellant therein and the Indian Oil Corporation. The Supreme Court held that in the event of cancellation of dealership, the appellant would have to vacate the premises of the Corporation as the remedy to operate either independently or through dealer, the appellant cannot be allowed to cause obstruction or create an impediment. The appellant whose dealership has been cancelled cannot claim to retain possession on the basis of ownership of the land as the lease is in continuance. The appellant in such an eventuality was himself a trespasser. The relevant paragarphs 20 and 21 of the said judgement are extracted below:

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"20. On a plain reading of the aforesaid agreement, it is clear as noon day that it has no connection whatsoever with the lease agreement. Both the agreements are independent of each other. The appellant was a dealer under the lessee, that is, the Corporation. The dealership is liable to be cancelled on many a ground. In case there is a termination, dealership is bound to be cancelled and at that juncture, if the lease deed is treated to have been terminated along with the dealership, it will lead to a situation which does not flow from the interpretation of the instruments. The dealership agreement has been terminated because of the decision rendered by this Court in Mukund Swarup Mishra (supra). The consequence of cancellation of the dealership is a sequitur of the judgment. The inevitable consequence of that is the appellant has to vacate the premises and the Corporation has the liberty to operate either independently or through another dealer. The appellant cannot be allowed to cause obstruction or create an impediment. The submission that the appellant entered into the lease agreement at a monthly rent of Rs.10,000/- as it was given the dealership is a mercurial plea, only to be noted to be rejected. The dealership was availed of as has been held by this Court in an inapposite manner. In such a situation, consequences are to be faced by the appellant.

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21. The second issue which has been feebly raised by the learned senior counsel for the appellant that the 1971 Act would not be applicable has really no force. Admittedly, the respondent is a public sector undertaking. The appellant whose dealership has been cancelled, cannot claim possession to

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retain possession on the basis of ownership of the land as the lease is in continuance. Therefore, he is a trespasser. Thus, the provisions of the 1971 Act apply on all fours and accordingly we repel the said submission."

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In the present case, we find that the petitioner had entered into a lease agreement with the Corporation for a long term lease of 30 years commencing from 1.7.2004 and the lease continues to subsist. The petitioner may in the meantime have applied for re-siting of the dealership/retail outlet to some other place for which also a separate and fresh lease agreement was executed between the petitioner as lessor and the Corporation as the lessee. Now the petitioner is seeking grant of No Objection Certificate for revocation of the earlier agreement entered into between the petitioner and the Hindustan Petroleum Corporation Ltd. In such an eventuality dealership will be cancelled and therefore the question for cancellation or revocation of the earlier lease on the basis of the NOC does not arise and no direction can be given to the respondents for issuing any such NOC.

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Learned counsel for the petitioner has also moved an amendment application no. 85878 of 2009 dated 29.3.2009 for adding respondents no. 4 and 5 in the array of the respondents and for making certain amendments in the writ petition and also challenging the order dated17.2.2009 whereby the retail outlet has also been allotted to Smt. Meena Verma.

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Shri Vikas Budhwar, learned counsel for the respondents referred to the letter dated 17.2.2009 which is sought to be challenged by way of amendment and submitted that this is a proposal in favour of one Meena Verma belonging to the scheduled caste 'woman' category and he again submitted that in view of the judgement of the Supreme Court even if the retail outlet or dealership is granted in favour of Meena Verma, the same cannot be cancelled nor any NOC can be issued in respect of the first lease agreement.

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In view of the law laid down by the Supreme Court in the case of Rahul Yadav (supra), we do not find any good ground for issuing any direction as prayed by the petitioner for the grant of No Objection Certificate for revocation of the first lease agreement between him and the respondent Corporation.

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The writ petition lacks merit and is accordingly dismissed . For the same reasons the amendment application is also rejected.

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Order Date :- 10.12.2018 o.k.

Kaushal Kishore Niranjan v. Hindustan Pet. Corpo. Ltd. and Others

Case brief

What is this about?

What did the court decide?

Kaushal Kishore Niranjan v. Hindustan Pet. Corpo. Ltd. and Others

Case brief

What is this about?

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What the court decided

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