Thereafter, the learned Judge referred to the definition of license, then observed as follows:-
“Under the aforesaid section, if a document gives only a
right to use the property in a particular way or under certain terms while it remains in possession and control of the owner thereof, it will be a license. The legal possession, therefore, continues to be with the owner of the property, but the licensee is permitted to make use of the premises for a particular purpose. But for the permission, his occupation would be unlawful. It does not create in his favour any estate or interest in the property. There is, therefore, clear distinction between the two concepts. The dividing line is clear though sometimes it becomes very thin or even blurred.”
18.Subba Rao, J., thereafter referred to the judgments of Court of Appeal in Errington V. Errington, 1952-1 All ER 149, and Cobb V. Lane, 1952-1 All ER 1199, and then observed as follows:-
“The following propositions may, therefore, be taken as
well-established : (1) To ascertain whether a document creates a license or lease, the substance of the document must be preferred to the form; (2) the real test is the intention of the parties - whether they intended to create a lease or a license; (3) if the document creates an interest in the property, it is a lease; but, if it only permits another to make use of the property, of which the legal possession continues with the owner, it is a license; and (4) if under the document a party gets exclusive possession of the property, prima facie, he is considered to be a tenant; but circumstances may be established which negative the intention to create a lease.” These propositions have been quoted with approval subsequently by a bench of three Judges in Konchanda Ramamurty Subudhi (dead) V. Gopinath Naik and Ors. reported in AIR 1968 SC 919, and in Capt. B.V. D’Souza V. Antonio Fausto Fernandes reported in AIR 1989 SC
19.(i) Having seen this legal position, we may now examine the submissions of the rival parties. It was submitted by Shri Ranjit Kumar, learned senior counsel that, it has to be noted that though the document of allotment states that the license is granted initially for a period of 15 years, clause 8 thereof adds that it may be renewed for a further period of 15 years by enhancing the license fee maximum by 40%, and thereafter at such a percentage as may be decided by the authority. This indicated the permission to the allottee to remain on the concerned parcel of land for a period of 30 years and more, and should therefore be construed as creating an interest in the parcel of land. Therefore, in his submission the document of allotment created a lease, and renewal thereof was a matter of formality, and the IDA was bound to renew the document. He referred to the judgment of this Court in Sudhir Kumar & Ors. vs. Baldev Krishna Thapar & Ors. reported in 1969 (3) SCC 611 to submit that a lessor cannot withhold his consent for renewal unreasonably. (ii) Shri Vikas Singh, learned senior counsel appearing for IDA and Ms. Vibha Datta-Makhija, learned counsel for the State Govt. submitted on the other hand that the possession of the allottee was merely a permissive one, and that it was not exclusive to warrant an inference of creation of an interest. In their view, the document of allotment when read in the entirety makes it very clear that it was a license and not a lease. JUDGMENT
20.In the instant case, if we peruse the document of allotment, the following facts are noticed:- (i) The first clause does provide that the land is given on license initially for a period of 15 years, and clause 8 does lay down that the license may be renewed for a further period of 15 years by enhancing the license fee maximum by 40%, and thereafter at such a percentage as may be decided by the Authority. We must, however, as well note the other provisions in the document of allotment and their effect. (ii) In the instant case, the document of allotment is called a ‘license’, and the allottee is called a ‘licensee’. In the very first clause, it is stated that the concerned parcel of land is given on license, and clause 4 refers to the amount payable by the licensee as the license fee which is to be paid annually before the first of June.
(iii) Clause 11 of the document requires the licensee to provide the specified games and rides in the amusement park. Not only that but clause 10 further requires that the rides, games etc. should be bought from the suppliers manufacturing them in India indigenously. (iv) Clause 7 authorises IDA to regulate the mode of collection of entry fee, and clause 5 provides that the amount equal to 25% of the entry fee will be charged by the IDA in addition to the license fee. Clause 7 further provides that the Authority (i.e IDA) or the officer authorised by the Authority will have the power to examine the accounts of collection of entry fee, as and when deemed fit.
21.It must also be noted that the concerned document has to be read as a whole, and when we see the above clauses together, it becomes clear that IDA retained complete control over the concerned parcel of land. The manner in which the facilities in the amusement park were to be enjoyed was completely controlled by the IDA. The IDA decided as to what games and rides were to be provided. It also laid down as to from which suppliers these games and rides were to be purchased. IDA further regulated the mode of collection of entry fee, and had the right to examine the accounts of collection thereof as and when it deemed fit. Over and above, Clause 14 of the document specifically provided that in the event of violation of any of these terms and conditions on the part of the licensee, the decision of the Chairman of IDA will be final, indicating the right of IDA to terminate the license in the event of such a contingency. Obviously when all these clauses are seen together, it becomes clear that there was no exclusive possession handed over to the appellants. Thus, the document of allotment merely granted a permission to use the concerned parcel of land in a particular manner, and without creating any interest therein. Hence, if we apply the tests which have been laid down by this court way back in the year 1959 (and followed subsequently) the document will have to read as granting a license, and not a lease.
22.The appellants had challenged the legality of the letter/order dated 23.9.2003 issued by the State Government to the IDA. That letter/order while declining the proposal of IDA to permit the amusement club and Banquet Hall proposed by the appellant, directed the IDA to utilize the land in question after issuing fresh notification inviting tenders. It was submitted that the IDA was in fact, favourably inclined to consider the proposal of the appellants, and the said letter/order indicated mala fides on the part of the State Govt. It was further submitted that IDA was a body corporate under Section 39 of the M.P. Act, and though section 73 empowers the State Government to give directions in matters of policy, this power cannot be exercised to give the directions of the kind contained in the letter dated 23.9.2003. In this connection it was contended that assuming that the letter may not be found to be vitiated by reason of malice on fact, but still it can be held to be invalid if the same had been issued for unauthorized purpose as it would amount to malice in law. Reliance was placed in this behalf on the proposition in paragraph 40 of the judgment of this Court in Punjab State Electricity Board Ltd. Vs. Zora singh and Ors. Reported in 2005 (6) SCC 776.
23.In our view, the appellants have tried to make much ado JUDGMENT about the stand which the IDA took on earlier occasions in favour of the appellants. One has to recognise that where different authorities are dealing with a particular subject, it is quite possible that on some occasions, they may take a stand different from each other, though ultimately it is the decision of the competent authority which matters, and it cannot be tainted with mala fides merely on that count. The following observations of this Court in para 35 of Jasbir Singh Chhabra & Ors. vs. State of Punjab reported in 2010 (4) SCC 192 are instructive in this behalf:-
“35. It must always be remembered that in a democratic
polity like ours, the functions of the Government are carried out by different individuals at different levels. The issues and policy matters which are required to be decided by the Government are dealt with by several functionaries some of whom may record notings on the files favouring a particular person or group of persons. Someone may suggest a particular line of action, which may not be conducive to public interest and others may suggest adoption of a different mode in larger public interest. However, the final decision is required to be taken by the designated authority keeping in view the larger public interest. The notings recorded in the files cannot be made basis for recording a finding that the ultimate decision taken by the Government is tainted by malafides or is influenced by extraneous considerations……”
24.The High Court has held in para 23 of the impugned judgment that in any case admittedly the license had come to an end by efflux of time in the month of the June 2010, and therefore the validity and legality of the letter/order dated 23.9.2003 had become academic, and it was no longer necessary to examine that issue. We cannot find fault with the High Court on that account,JUDGMENTsince quashing of this letter cannot in any way lead to the renewal of the license which had already expired. Besides, the respondents had valid reasons not to renew the license as indicated in the show cause notice dated 8.1.2007. The construction of Amusement Club or a Banquet Hall could certainly not be a part of a Children’s Amusement Park. The parcel of land was allotted for setting up of a children’s park with games and rides as indicated in the document of license. Additionally, what was permitted were the food and beverages centers, kiosks, shops, administrative building and toilets, which would be in furtherance of this objective. The Banquet Hall and an amusement club which would be used by adults would not fit in the purpose of Children’s Amusement Park. As stated in clause 8 of the show cause notice, it clearly indicated that the appellants did not want to run the activity related to the Children’s amusement park on the land allotted.
25.(i) It was submitted on behalf of the appellants that they had made good investment in the concerned parcel of land with legitimate expectations, and, therefore, the respondents were estopped from discontinuing their allotment on the basis of the doctrine of promissory estoppel. This submission was disputed by Shri Vikas Singh, learned senior counsel appearing for IDA. He ,firstly, pointed out that more than half of the land remained un-utilised even 12 years after the allotment, and, in fact, the park was not functioning for quite sometime. The games and rides which were placed on this parcel of land were in the nature of fixtures, and not permanent additions as such, and could be removed therefrom when the appellants were required to vacate. JUDGMENT (ii) Having noted these submissions we are of the view that since the document of allotment was a license and not one creating any interest, the provision of renewal contained therein cannot be read as laying down a mandatory requirement. Besides, as stated above, clause 14 of the document of license clearly stated that in the event of violation of any of the terms and conditions on the part of the licensee, the decision of the Chairman of IDA was final. Para 7 of the show cause notice in fact stated that the necessary action to establish the Children’s Amusement Park had not been taken since half of the land had remained undeveloped, and it amounted to violating the conditions of license. The doctrine of promissory estoppel can certainly not be permitted to be invoked on such a background.
26.(i) The appellants had made one more prayer namely to quash and set aside the notification dated 19.11.2003. Section 23-A of the M.P. Act permits the modification of the provisions in the development plan by following the due procedure of law as laid down therein. In the instant case, a notification had been issued earlier on 9.3.2001 inviting the objections to the proposed modification. The appellants were heard with respect to these objections, and thereafter the notification dated 19.11.2003 had been issued approving the proposed modification. It was contended on behalf of the appellants that the modification was a motivated one. The appellants submitted that under the modification, a parcel of land in nearby vicinity which was earlier reserved for a green JUDGMENT area, was now being permitted for a commercial use, whereas the user of the land which was marked for the Children’s Amusement Park, was being changed to a regional park. This was with a view to accommodate the constructions which had come up on the other parcel of land in the vicinity.
(ii) In this connection we must note that the appellants had not joined any of those parties for whose benefit this change had been allegedly made. As held in Girias Investment (P) Ltd. vs. State of Karnataka & Ors. reported in 2008 (7) SCC 53, in the absence of factual basis, the court is precluded from going into the plea of malafides. As far as the land meant for the Children’s amusement park is concerned, the same was hardly put to the full use. In as much as this entire parcel of land of about 7 acres was not utilized, and since it was an open parcel of land, there was nothing wrong in the State Government deciding to retain it as an open parcel of land, and to change the land-use thereof from commercial to a regional park. The notification cannot be faulted on that count either.
27.In the circumstances, we do not find any error in the impugned judgment of the High Court. The appeal is therefore dismissed. Parties will bear their own costs.
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JUDGMENT( Surinder Singh Nijjar ) ( H.L. Gokhale ) New Delhi Dated: 28th August, 2012