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Friday, May 8, 2015

admittedly, the writ petitioner held land comprised in mill and factory measuring about 4.54 acres, which is well within the ceiling both under the WBEA Act and WBLR Act. Therefore, retention of the land under Section 6(1) could not be subjected to Section 6(3) of the WBEA Act, which applies in respect of land held in excess of the ceiling. Similarly, Section 14Z(2) of the WBLR Act applies to land held by a raiyat in excess of the ceiling. Once the writ petitioner became a raiyat by virtue of operation of Section 3A read with Section 4 along with the amendment of the definition of land in Section 2(7) of the WBLR Act with heritable and transferable right in respect of land held by him within the ceiling, there is no scope for application of Section 14Z(2) of that Act.

                                                                  REPORTABLE

                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION


                       CIVIL APPEAL NOs. 2548 OF 2006

State of West Bengal and others              …..Appellant(s)
                                   versus

Calcutta Mineral Supply Co. Pvt. Ltd.
and another                                               ...Respondent(s)


                                    WITH

                       CIVIL APPEAL NOs. 2549 OF 2006

Collector, Jalpaiguri and another            …..Appellant(s)
                                   versus

Darjeeling Dooars Plantations (Tea) Ltd.
and another                                         ...Respondent(s)




                                  JUDGMENT



M. Y. EQBAL, J.



      These appeals  by  special  leave  are  directed  against  the  common
judgment and order dated 6.10.2005  of  the  Calcutta  High  Court,  whereby
Division Bench of the High Court allowed the  writ  petitions  preferred  by
the respondents herein against the decision of the West Bengal Land  Reforms
and Tenancy Tribunal (in short, ‘the Tribunal’)  dismissing  their  original
applications moved against the respective order passed by the Government  of
West Bengal resuming the lands held by them.



2.    By the impugned judgment, the High Court has disposed  of  three  writ
petitions primarily observing that although the facts  are  different  there
are certain communions of identity within the question to  be  answered  and
certain common principles of law are involved in the writ petitions.



3.    In the matter of Calcutta Mineral Supply Co. Pvt.  Ltd.  (being  Civil
Appeal No.2548 of  2006),  the  respondent-writ  petitioner  held  the  land
measuring about 4.54 acres comprised in a  factory  or  mill  together  with
structures even before the West Bengal Estates  Acquisition  Act,  1953  (in
short, ‘WBEA Act’) came into force.  Factual matrix of this case is that  as
a result of notification under Section 4 and effects thereof  under  Section
5 of the WBEA Act all the land comprised in factory  vested  in  the  State.
However, by reason of Section 6(1)(g) read with Section 6(3)  of  that  Act,
the Company was allowed to retain all the lands comprised in factory as  the
State Government was of the opinion that the Company required all the  lands
for the purpose of the factory.



4.    However, in 1996, it came to the notice of the State  Government  that
the Company had alienated almost half of the land  and  no  land  was  being
used for the purpose of the factory, which remained closed since  1993.   In
exercise of the power conferred on it by the proviso to Section 6(3) of  the
Act, the State Government by order dated 2nd April, 1996 revised  the  order
and resumed 3.76 acres of land as surplus as in the  opinion  of  the  State
Government the company did not require the land for the purpose  of  running
its factory. The Company challenged that order by way of  a  writ  petition,
which stood  transmitted  to  the  aforesaid  Tribunal  and  was  dismissed.
Aggrieved by the decision  of  the  Tribunal,  the  Company  preferred  writ
petition before the High Court.  The Division Bench of the  High  Court  set
aside order of the Tribunal holding that order dated  2nd  April,  1996  was
not a speaking order and directing the  State  Government  to  consider  the
matter afresh.   Thereafter,  Special  Secretary  of  the  State  Government
passed speaking order  directing  resumption  of  the  land  allowed  to  be
retained by the  respondent-Company.   This  order  was  challenged  by  the
respondents, but the Tribunal dismissed their application.



5.    Aggrieved by the decision of the Tribunal,  Company  again  moved  the
High Court by way of a writ petition, which  was  allowed  by  the  Division
Bench of the High Court by the impugned judgment.  The  High  Court  quashed
the order of resumption passed by the State Government as also the  judgment
of the Tribunal and held that the exercise of power under the  WBEA  Act  in
the instant case was without jurisdiction and that  the  respondents  having
held land within the ceiling limit had acquired the status  of  raiyat  with
heritable and transferable right and cannot be subjected to Section 14-Z  of
the West Bengal Land Reforms Act.



6.    In the matter of  Darjeeling  Dooars  Plantations  (Tea)  Ltd.  (being
Civil Appeal No.2549 of 2006), the tea estate known as Zurantee  Tea  Estate
(Zurantee) was leased out by the Government of  West  Bengal  in  favour  of
Chulsa Tea Company (in short, ‘Chulsa’) being limited for  a  period  of  30
years on 30th January, 1975.  In the record  of  right  prepared  under  the
WBEA Act, the land was recorded to have been permitted to be retained  under
Section 6(3) of the WBEA Act.  The original lease was granted on 1st  April,
1924 and expired before the WBEA Act came into force.  In 1976, Chulsa  sold
Zurantee to Darjeeling Dooars Plantations (Tea) Ltd. (in short, ‘respondent-
Company’).



7.    By an order dated 25th August, 1976, the tea  estate  was  mutated  in
favour of respondent-Company.  In a Company Petition  of  1990,  High  Court
had allowed a scheme of amalgamation  between  the  respondent-Company,  the
transferor, and Karala  Valley  Tea  Co.  Ltd.  (in  short,  ‘Karala’),  the
transferee, under which Scheme, the name of transferee  Karala  was  changed
to Darjeeling Dooars and  all  rights,  title  and  interest  of  Darjeeling
Dooars vested in it.  Subsequently by an order dated  18th  November,  1991,
the Land Registration Collector allowed mutation of the name in  respect  of
Zurantee in favour of Darjeeling Dooars.



8.    The Government of West Bengal issued a notification on 1st June,  1994
amending Schedule ‘F’ of the WBEA Rules inserting Clause 1A  and  1B  to  be
incorporated in the lease requiring payment of  salami  of  Rs.15,000/-  per
hectare of land leased out before further renewal  of  the  lease  in  cases
renewal was asked for by a transferee allowing the transferee to  enjoy  the
balance period of the lease  transferred.   The  respondent-Company  applied
for the renewal of lease of the Zurantee for a period of 30  years  on  10th
March, 1998 and a deed renewing the lease was executed on 12th  March,  1998
in favour of the respondent-Company. In March, 2002, the Collector  demanded
a sum of Rs.1,10,50,200/- as salami in respect of renewal of the said  lease
pursuant to the amended clause, which  was  challenged  by  the  respondent-
Company before  the  Tribunal.   Upon  the  matter  being  remanded  by  the
Tribunal, the Collector again held that the  respondent-Company  was  liable
to pay salami and directed the Company to deposit the same.  The respondent-
Company again moved before the Tribunal by way of an application, which  was
dismissed.   The  Tribunal  upheld  the  notification  imposing  salami   on
transfer of tea estate.  Aggrieved  by  the  order,  the  respondent-Company
moved the High Court by way of writ  petition,  which  was  allowed  by  the
Division Bench of the High Court by the  impugned  judgment.   Holding  that
the respondent-Company was entitled to renewal of the lease without  payment
of salami, the High Court quashed the order of the Tribunal as well  as  the
order of the Collector and the letter of demand.



9.    Hence, these two appeals by special leave have been preferred  by  the
State  Government  and  its  functionaries  under   Article   136   of   the
Constitution.



10.   Now we shall discuss the facts and law applicable  thereto  separately
for better appreciation of the case of the parties.



                        Civil Appeal No.2549 of 2006
   (Collector, Jalpaiguri and another  vs.  Darjeeling Dooars Plantations
                           (Tea) Ltd. and another)

11.   Admittedly in the year 1924, the appellant  granted  a  lease  of  the
property for a period of 30 years, which expired in  1954.   The  respondent
continued in possession till 1974 when a fresh lease deed  was  executed  on
30.1.1975 in favour of Chulsa Tea Company Limited  in  respect  of  Zurantee
Garden.  The lease was made effective from 25.3.1968.   Some  of  the  terms
and conditions of the lease which are relevant in the present case,  are  as
under:

“(4)(a) That the Lessee/Lessees shall at all times observe  and  conform  to
the relevant provisions of the West Bengal  Estates  Acquisition  Rules  for
the time being in force.

(b)   That in respect of land  comprised  in  a  forest  the  Lessee/Lessees
shall be subject to the control and supervision of the State Government.

                                  xxxxxxxx

(13) (a) That the Lessee shall not transfer, whether in full or in part,  or
club  or  amalgamate  tea-gardens  without  the  formal  sanction   of   the
Collector;

Provided that except in cases  where  the  provisions  of  the  West  Bengal
Alienation of Land (Regulation) Act, 1960 (West Bengal  Act  XVI  of  1960),
apply, no such sanction shall be necessary for equitable mortgage of a  tea-
garden with a Scheduled Bank by  the  deposit  of  title  deeds.   All  such
equitable  mortgages  shall,  however,  be   referred   to   the   Collector
immediately.

(b)   That the lease-hold interest shall be heritable.

(c)   That in the case of a transfer of such  lease-hold  interest,  whether
in full or in part, the same shall be subject to the provision  of  any  law
for the time being in force and  applicable  thereto  and  also  subject  to
prior consent of the Collector.

                                  xxxxxxxx

(16) (a) That the Lessee/Lessees shall be entitled to  the  renewal  of  the
lease for a further period of thirty years and to  successive  renewals  for
similar periods, subject to the rules and the terms and conditions  of  this
lease and the such other terms and conditions as the  State  Government  may
from time to time consider it  necessary  to  impose  and  include  in  such
renewed lease or leases and subject further to such  rent  as  may  then  be
fixed, provided that such additional  terms  and  conditions  shall  not  be
inconsistent  with  the  law  regulating  such  lease  and  shall  not  have
retrospective effect.”





12.   From the aforementioned terms and conditions contained  in  the  lease
deed of 1975, it is clear that  the  respondent  lessee  shall  observe  and
conform to the relevant provisions of the West  Bengal  Estates  Acquisition
Rules for the time being in force.  Clause 13(a) further provides  that  the
lessee shall not transfer without the formal sanction of the  Collector  and
Clause 13(c) provides that the transfer shall be subject to any law for  the
time being in force and also subject to prior consent of the Collector.



13.   Clause 16(a) of the lease deed contains a renewal clause according  to
which the lessee shall be entitled  to  the  renewal  of  the  lease  for  a
further period of thirty  years  and  to  successive  renewals  for  similar
periods, subject to the rules and the terms and  conditions  of  this  lease
and also such other terms and conditions as the State  Government  may  from
time to time consider it necessary to impose and  include  in  such  renewed
lease or leases and subject further to such  rent  as  may  then  be  fixed.
However, such additional terms and  conditions  shall  not  be  inconsistent
with the law regulating such lease and shall not have retrospective effect.



14.   Indisputably, during the subsistence  of  the  lease,  the  respondent
Darjeeling Dooars Plantations (Tea) Ltd. and the Karala Valley  Tea  Company
were  amalgamated  and  all  the  properties,  rights  and  interest   stood
transferred to the respondent Darjeeling Dooars Plantations  (Tea)  Ltd.  by
the order passed by the Calcutta High  Court  on  31.10.1990  in  a  Company
petition.  It is also not  in  dispute  that  the  name  of  the  respondent
Darjeeling Dooars Plantations (Tea) Ltd. was mutated by  the  order  of  the
Collector dated 28.11.1991.



15.    Originally the lease was granted in the year 1924 for a period of  30
years.   Before the expiry of the period of lease, the West  Bengal  Estates
Acquisition Act,  1953  came  into  force  in  the  State  of  West  Bengal.
According to Section 4 of the Act, all  estates  and  the  rights  of  every
intermediary in each such estate stood vested in the  State  free  from  all
encumbrances with effect from the date of notification time to  time  issued
by the State Government.  Section 5 of the said Act deals  with  the  effect
of the notification.  Section 6 of the said Act  lays  down  the  provisions
with regard to right of intermediary to retain  certain  lands.   Section  6
reads as under:

“6.  (1)  Notwithstanding  anything  contained  in  sections  4  and  5,  an
intermediary shall, except in the cases mentioned in  the  proviso  to  sub-
section (2) but subject to the other  provisions  of  that  sub-section,  be
entitled to retain with effect from the date of vesting—

(a) xxxxxxxxxx
(b) xxxxxxxxxx
(c) xxxxxxxxxx
(d) xxxxxxxxxx
(e) xxxxxxxxxx

(f) subject to the provisions of sub-section  (3),  land  comprised  in  tea
gardens or orchards or land used for  the  purpose  of  livestock  breeding,
poultry farming or dairy;

(g) xxxxxxxxxx
xxxxxxxxxx


(2) An intermediary who is entitled to retain possession of any  land  under
sub-section (1) shall be deemed to hold such land directly under  the  State
from the date of vesting as a tenant, subject to such terms  and  conditions
as may be prescribed  and  subject  to  payment  of  such  rent  as  may  be
determined under the provisions of this Act and as entered in the record-of-
rights finally published under Chapter  V  except  that  no  rent  shall  be
payable for land referred to in clause (h) or (i) :

Provided that if any tank fishery or any land  comprised  in  a  tea-garden,
orchard, mill, factory or workshop was held immediately before the  date  of
vesting under a lease, such lease shall be deemed to have been given by  the
state Government on the same terms  and  conditions  as  immediately  before
such date subject to such modification therein as the State  Government  may
think fit to make.

(3) In the case  of  land  comprised  in  a  tea-garden,  mill,  factory  or
workshop the intermediary, or where the land is  held  under  a  lease,  the
lessee, shall be entitled to retain only so much of such  land  as,  in  the
opinion of the State  Government,  is  required  for  the  tea-garden,  mill
factory or workshop, as the case may be, and a person holding  under  to  be
an intermediary:

Provided that the State Government may, if it thinks  fit  so  to  do  after
reviewing the circumstances of a case and after giving the  intermediary  or
the lessee, as the case may be, an opportunity of being  heard,  revise  any
order made by it under  this  sub-section  specifying  the  land  which  the
intermediary or the lessee shall be entitled to retain as being required  by
him for the tea-garden, mill, factory or workshop, as the case may be.

Explanation:—The expression “land held under  a  lease”  includes  any  land
held directly under the State under a lease.

Exception:-In the case of land allowed to be retained by an intermediary  or
lessee in respect of a tea-garden, such land may include any land  comprised
in a forest if, in the opinion of the State Government, the  land  comprised
in a forest is required for the tea-garden.”



16.   Reading relevant provisions of Section  6,  it  is  manifest  that  an
intermediary, in possession of the  land  including  tea  garden,  shall  be
entitled to retain subject to the provisions contained  in  sub-section  (3)
of Section 6 of the said Act.  Sub-section 3 very clearly provides that  the
lessee in possession of tea garden etc. shall continue and shall  be  deemed
to be an intermediary.



17.    Section 59 of the WBEA Act empowers the  State  Government  to  frame
rules for carrying out the purpose of the Act.  Section 59 of the Act  reads
as under:

“Section 59 - Power to make rules

 (1) The State Government may, after previous publication,  make  rules  for
carrying out the purposes of this Act.


(2) In particular, and without prejudice to the generality of the  foregoing
power, such rules may provide for all or any of  the  matters  which,  under
any provision of this Act, are required to be prescribed or to  be  provided
for by rules.”



18.   In exercise of the power conferred by Section 59 of the Act, the  West
Bengal Estates  Acquisition  Rules,  1954  was   framed  and  the  same  was
published in the official Gazette vide Notification dated  28.5.1954.   Rule
4 of the said Rules inter  alia  provides  that  the  land  retained  by  an
intermediary under the provisions of sub-section (1) of Section 6  shall  be
held by him from the date of vesting on the terms and  conditions  specified
in the Rules.   So  far  as  the  tea  garden  is  concerned,  it  has  been
specifically provided that an intermediary  shall  hold  such  land  on  the
terms  and  conditions  set  out  in  Schedule  F  appended  to  the  Rules.
Therefore, for better appreciation,  Schedule  F  and  the  Form-1  for  the
purpose of granting lease for tea garden have been reproduced here.

                                 “SCHEDULE F
                                  [Rule 4]

Land comprised in a tea  garden  retained  by  an  intermediary  under  sub-
section (1), read with sub-section (3), of section 6 shall be deemed  to  be
held directly under the State from the date of vesting as a tenant [until  a
lease is granted in Form I appended to this  schedule,  on  such  terms  and
conditions as may be specified by the Collector  in  a  summary  settlement,
and thereafter, on a  lease  being  granted  in  Form  I  appended  to  this
schedule, on the terms and  conditions  specified  in  such  lease].   There
shall be a lease in Form I in respect of each  such  intermediary,  and  the
same shall be registered and numbered in the office of the Collector.

1A     xxxxxxxxxxxxxxxxxxxx

1B    xxxxxxxxxxxxxxxxxxxx


The first lease shall be given from the date of the order under  sub-section
(3) of section 6 or from the date of the determination  of  the  rent  under
section 42, whichever is later.”





19.   By Notification dated  1.6.1994  issued  by  the  Government  of  West
Bengal, Land & Land Reforms Department, an amendment  has  been  brought  in
Schedule  F  to  the  said  Rules  discussed  hereinabove.   By   the   said
notification, two sub-paragraphs being 1A and 1B were  inserted,  which  are
reproduced hereunder:

“1A.  When the lease of a tea garden is determined and  the  tea  garden  is
leased afresh to a new lessee, the later shall be liable to  pay  salami  at
the rate of Rs.15,000/- per hectare of the land leased out.

1B.   In case of a transfer of the leasehold  interest,  except  by  way  of
inheritance, the transferee shall not be liable to  pay  salami  during  the
unexpired period of the lease.  On the expiry of the transferred  lease,  he
shall be liable to pay salami at the rate of Rs.15,000/- per hectare of  the
land leased out before the lease is further renewed.”



20.   In Clause (13), sub-clause (dd) was also  inserted,  which  is  quoted
hereinbelow:

“(dd) That the transferee, other than by inheritance, shall be  required  to
enter into a fresh lease on payment of salami  at  the  rate  laid  down  in
paragraph 1B of Schedule F within three months of expiry  of  the  unexpired
period of lease.”



21.   It is therefore manifest that when  a  lease  of  the  tea  garden  is
determined by efflux of time and a lease is granted afresh  to  new  lessee,
the latter shall be liable to pay salami at  the  rate  of  Rs.15,000/-  per
hectare  of  the  land  leased  out.   Clause  1B  also  provides  that  the
transferee shall not be liable to pay salami during  the  unexpired  period,
but on the expiry of the lease, he shall be liable  to  pay  salami  at  the
rate of Rs.15,000/- per hectare of the land leased out before the  lease  is
further renewed.



22.   Admittedly, the lease of 1975, which became effective from  1968,  got
expired in the year 1998.  The respondent  then  approached  the  Government
for  renewal  of  the  lease.   The  Collector   prepared   a   lease   deed
incorporating the terms and conditions contained in the  earlier  lease  and
referred it to the Government  for  final  approval.   The  request  of  the
respondent for grant of lease was considered by the Government and by  order
as  contained  in  letter  dated  5.10.2001,  addressed  to   the   District
Magistrate &  Collector,  Jalpaiguri,  informed  that  the  Government  will
accord post facto approval to the renewal of the lease for a further  period
of 30 years on payment of salami of Rs.15,000/-  per  hectare.   The  letter
dated 5.10.2001 is reproduced hereunder:

                         “Government of West Bengal
                      Land and Land Revenue Department
                             Land Reforms Branch
                                 L.R. Bench

No.4051-LR/3T-69/04

                                       Dated, Kolkata, the 5th October, 2001

From: The Deputy Secretary to the Govt. of West Bengal

To:  The  District  Magistrate  &  Collector,  Jalpaiguri,  P.O.   &   Dist.
Jalpaiguri.

Sub: Proposal for post-factor approval to the renewal of lease of  the  land
comprised in Zurantee Tea Garden in Jalpaiguri District.

      The undersigned is directed to refer to the above subject and  to  say
that post-facto approval to the renewal of lease of the  land  comprised  in
Zurantee Tea Garden for the period of 30 years in favour of M/s.  Darjeeling
Dooars Plantation (Tea) Limited will be accorded after salami @  Rs.15,000/-
per hectare and  other  dues,  if  any,  are  realized  from  the  concerned
Company.  Till such post-facto approval is  accorded,  renewal  accorded  by
him will remain inoperative.

      He is, therefore,  requested  to  realize  all  the  dues  and  report
compliance thereof to the Department with the certificate that there  is  no
arrear dues from the concerned companies so as to enable the  Govt.  in  the
Land & Land Reforms Department to accord necessary  post-facto  approval  as
so proposed by him.

He is also requested to furnish the copy of relevant documents  particularly
the copy of the High Court’s order and copy of certificate of  incorporation
issued by the Registrar of Companies based on which Mutation case  no.  IV-5
of 1991-92 was finalized and mutation was allowed.

                                                                        Sd/-

                               Deputy Secretary to the Govt. of West Bengal”



23.   In pursuance to the decision taken by the State Government,  an  order
was passed by the  Collector,  Jalpaiguri  dated  29.11.2002  directing  the
respondent to deposit Rs.15,000/- per hectare  as  salami  at  the  time  of
renewal before according approval of the Land  &  Land  Revenue  Department.
The order was communicated to  the  respondent  and  the  same  came  to  be
challenged before the Land Reforms and  Tenancy  Tribunal.   The  respondent
sought a declaration that the Notification dated 1.6.1994 and amendments  of
the  Rules  in  Schedule  F   and   Form   1   thereto   are   illegal   and
unconstitutional.  The  said  application  was  rejected  by  the  Tribunal.
However, by the impugned order, the High Court  allowed  the  writ  petition
and quashed the order of the Tribunal.



24.   We have heard Mr. Rakesh Dwivedi,  learned  senior  counsel  appearing
for the  appellant-State  and  Mr.  A.K.  Ganguli,  learned  senior  counsel
appearing for the respondent-Company in Civil Appeal No.2549 of 2006.



25.   Mr. Dwivedi assailed the order of the High Court as being contrary  to
the facts of the case and mis-appreciating the status of the  respondent  by
recognizing it as a lessee and not as a transferee.  Mr.  Dwivedi  submitted
that Clause 1A and 1B, as inserted by the amendment, will apply on  its  own
course as even the inclusion of these clauses  in  the  lease  deed  is  not
necessary.   According to the learned  counsel,  Clause  16(a)  was  already
there  in  the  previous  lease  and  as  per  the  said  clause  additional
conditions to the subsequent lease can be included.  Mr.  Dwivedi  submitted
that post facto sanction by the State  Government  is  a  pre-condition  for
payment of salami and for  that  reason  the  lease  deed  executed  by  the
respondent  was  signed  by  the  Collector  and  forwarded  to  the   State
Government for sanction.  According to Mr. Dwivedi, renewal of  lease  is  a
fresh one and lessor, namely the State, is entitled  to  include  additional
terms and conditions in the said document of lease.



26.    Mr.  A.K.  Ganguli,  learned  senior  counsel   appearing   for   the
respondent, on the other hand  contended  that  the  lease  granted  to  the
predecessor-in-interest of the respondent is  statutory  lease  governed  by
the Act and the Rules made thereunder and unless and  until  the  amendments
brought in by the notification dated 1.6.1994 and incorporated  in  Form  1,
salami  cannot  be  realised.   According  to  the  learned   counsel,   the
respondent-Company came into existence  much  before  the  transfer  of  the
leasehold interest, by virtue of amalgamation and the order  passed  by  the
High  Court  in  the  Company  Petition.   According  to  Mr.  Ganguli,  the
respondent is in the  nature  of  joint  venture  Company.   Learned  senior
counsel relied upon decision of this Court in the case of New Horizons  Ltd.
vs. Union of India (1995) 1 SCC 478 and in the case of  State  of  U.P.  vs.
Lalji Tandon, (2004) 1 SCC 1.



27.   Perusal of the impugned order passed by  the  High  Court  would  show
that although the High Court took notice of clause 16(a) of the  lease  deed
and amendment brought in the Schedule F and Form 1 of the Rules it  came  to
the following conclusion:


“22.1. These terms of renewal are clear and unambiguous and these are  terms
exactly, which is provided in Schedule "F" Form-I  of  the  WBEA  Rules.  In
terms  of  the   conditions   contained   in   Clause   16(a),   the   State
Government/lessor  was  entitled  to  incorporate   additional   terms   and
conditions consistent with the law regulating  the  lease  with  prospective
effect in the renewed lease. This lease was granted in terms of  Rule  4  of
the WBEA Rules in terms of Schedule "F" in Form-I.  The  State  is  entitled
only  to  incorporate  additional  conditions  in  the  renewed  lease  with
prospective effect.  Therefore,  the  amendment,  if  any,  incorporated  in
Schedule "F" by reason of the amendment effective from  1st  of  June,  1994
would not be effective in respect of unexpired period of the lease to  which
the Darjeeling Dooars had stepped into. Therefore, under Clause  16(a)  read
with Schedule "F", Darjeeling Dooars was entitled to renewal  of  the  lease
on the same terms and conditions. The amendment brought about could  not  be
given retrospective effect to affect  the  right  of  the  lessee/transferee
stepping into the shoes of the transferor-lessee to obtain  further  renewal
of the lease for further period of 30 years and to successive  renewals  for
similar periods. The only liberty the State Government had  under  the  said
clause is that  it  can  impose  and  include  in  the  said  renewed  lease
additional terms and conditions not inconsistent with Rule  4  Schedule  "F"
and Form-I of the WBEA Rules without retrospective effect.


22.2. Therefore, the amendment  brought  about  in  Schedule  "F"  could  be
incorporated in the renewed lease and was so  rightly  incorporated  in  the
1998 lease. As such the  conditions  so  incorporated  became  part  of  the
renewed lease and would govern the  terms  and  conditions  of  the  renewed
lease and that too prospectively.  These  additional  terms  and  conditions
incorporated in the renewed lease  became  effective  after  the  lease  was
renewed, namely when the right to renew the lease  was  exercised  and  upon
such exercise the right came to an end and the renewal of the lease being  a
fresh lease, these terms cannot operate to affect a situation prior  to  the
renewal of the lease. In terms of these additional  conditions,  the  salami
is payable in consideration of the renewal after the expiry of  the  renewed
lease containing the terms. A term, which was not in existence in the  lease
sought to be renewed within the scope of Clause 16(a), could not govern  the
right of the lessee to obtain renewal of the right or the  State  to  impose
conditions for renewal on the basis of Clause 16(a) of the  1975  lease,  as
was held in Delhi Development Authority v. Durga  Chand  Kaushish  [1974]  1
SCR 535 .

xxxxxxxxxx


22.4. The amendment also does not provide that  the  amended  clauses  would
have retrospective operation. In any event, the terms of  the  lease  cannot
be substituted even  by  legislation.  No  vested  right,  particularly,  in
respect of fiscal or revenue matters already accrued  could  be  taken  away
through legislation; neither  any  legislation  in  that  respect  could  be
retrospective in operation.


Conclusion:


23. In these circumstances, the additional terms contained  in  the  renewed
lease would be effective at  the  time  of  renewal  of  the  renewed  lease
entitling the State of  demand  salami  in  terms  of  Clause  1B  from  the
transferee if there is any transfer. However, salami can be demanded by  the
State under Clause 1A upon determination of the lease  from  the  person  to
whom the fresh lease is granted after the 1994 Amendment of the  WBEA  Rules
even if Clause 1A was not incorporated in the lease determined.


23.1. In these circumstances, the  Government  is  not  entitled  to  demand
salami in terms of Clauses 1A or 1B incorporated in the renewed lease  as  a
consideration for the 1998  renewal  from  the  Darjeeling  Dooars.  Such  a
demand is inconsistent with the law regulating  such  lease  and  cannot  be
retrospective in effect.”



28.   We have given our anxious consideration to the reasoning  assigned  by
the High Court while arriving at such conclusion.  In  our  view,  the  High
Court has misconstrued and misinterpreted the relevant provisions  contained
in the Rules viz-a-viz the condition  of  renewal  as  contained  in  clause
16(a) of the lease deed.  The High Court  has  committed  error  of  law  in
holding that the amendment brought about could not  be  given  retrospective
effect to affect the right of the lessee/transferee stepping into the  shoes
of the transferee/lessee to obtain further renewal of lease  for  a  further
period of 30 years and to successive  renewals  for  similar  periods.   The
High Court is not correct in law in holding that the  amended  clause  would
have retrospective operation.



29.   Indisputably, the  renewal  of  lease  is  a  fresh  grant  where  the
principal lease executed between the parties containing a  clause  that  the
lease shall have to be renewed by giving a fresh grant  in  accordance  with
the said clause.  In the instant case, as per clause 16(a)  of  the  earlier
lease deed, the lease is to be renewed for a further period of 30 years  but
subject to the rules and the terms and conditions  of  the  lease  and  also
such other terms and conditions as the State Government  may  from  time  to
time consider it necessary to impose and  include  in  such  renewed  lease.
Clause 16(a) further provides that additional terms and conditions that  may
be considered necessary by the State Government be  included  but  the  same
shall not be inconsistent with the law renewing such  lease  and  shall  not
have retrospective effect.



30.   As noticed above, the State Government by notification dated  1.6.1994
brought amendment in the Rules by incorporating  two  more  conditions  i.e.
paragraph 1A and 1B.  As per the additional  condition,  in  case  of  fresh
lease granted by the State in respect of tea garden,  the  lessee  shall  be
liable to pay salami at the rate of Rs. 15,000/- per  hectare  of  the  land
leased out.  However, paragraph 1-B made it clear that in case  of  transfer
of leasehold interest, the transferee shall not  be  liable  to  pay  salami
during the unexpired period of lease, but after the expiry of  the  existing
period of lease the transferee shall be liable to pay salami at the rate  of
Rs. 15,000/- per hectare before the lease is further renewed.


31.   Admittedly, before the expiry of the lease in question  in  1998,  the
respondent/transferee stepped into the shoes of the original lessee  in  the
year 1990.  In 1994,  by  notification  dated  1.6.1994,  an  amendment  was
brought in Schedule F of the Rules, as discussed hereinabove,  in  terms  of
clause I-B. Therefore, the respondent shall not  be  liable  to  pay  salami
during the unexpired period of lease up to 1998.  The State  Government  has
rightly not made any claim for salami for the  unexpired  period  of  lease,
but for the fresh renewal of lease after 1998 which is a fresh  grant.   The
demand of salami by State Government for according sanction for  renewal  of
lease cannot and shall not by any stretch  of  imagination  be  held  to  be
retrospective.



32.  In the case of State of U.P. vs. Lalji Tandon, (2004)  1  SCC  1,  this
Court while considering the renewal clause in the lease deed observed:-


“13. In India, a lease  may  be  in  perpetuity.  Neither  the  Transfer  of
Property Act nor the general law abhors a lease  in  perpetuity.  (Mulla  on
the Transfer of Property Act, 9th Edn., 1999, p.  1011.)  Where  a  covenant
for renewal exists, its exercise is, of course,  a  unilateral  act  of  the
lessee, and the consent of the lessor is  unnecessary.  (Baker  v.  Merckel,
also Mulla, ibid., p.1204.) Where the principal lease executed  between  the
parties containing a covenant for renewal, is  renewed  in  accordance  with
the said covenant, whether the renewed  lease  shall  also  contain  similar
clause for renewal depends on the facts  and  circumstances  of  each  case,
regard being had to the  intention  of  the  parties  as  displayed  in  the
original covenant for renewal and the surrounding circumstances. There is  a
difference between an extension of lease in accordance with the covenant  in
that regard contained in the principal lease and renewal of lease, again  in
accordance with the covenant for renewal contained in  the  original  lease.
In the case of extension it is not necessary to have a fresh deed  of  lease
executed, as the extension of lease for the term  agreed  upon  shall  be  a
necessary consequence of the  clause  for  extension.  However,  option  for
renewal consistently with the covenant  for  renewal  has  to  be  exercised
consistently with the terms thereof and,  if  exercised,  a  fresh  deed  of
lease shall have to be executed between the parties. Failing  the  execution
of a fresh deed of lease, another lease for a  fixed  term  shall  not  come
into existence though the principal lease in spite  of  the  expiry  [pic]of
the term thereof may continue by holding over for year by year or  month  by
month, as the case may be.”


33.   In the case of Gajraj Singh  &  ors.  vs.  State  Transport  Appellate
Tribunal & ors., (1997) 1 SCC 650, this Court  while  considering  the  term
renewal of lease or licence contained in document, observed that  “grant  of
renewal is a fresh grant though it breathes life into the operation  of  the
previous lease or licence granted as per existing appropriate provisions  of
the Act, rules or orders or acts intra vires or as per the law in  operation
as on the date of renewal”.



34.   In the case of M.C. Mehta vs. Union of India &  ors.,  (2004)  12  SCC
118, a Division Bench of this Court was considering the question as  to  the
effect of notification in such case  where  the  lessee  claims  renewal  of
mining lease.  Some of the leases were granted for extraction  of  minerals.
In the mean time, the notification dated 27.1.1994 was  issued  by  Ministry
of Environment  and  Forest,  Government  of  India  in  exercise  of  power
conferred by Environment (Protection) Act, 1986  putting  a  restriction  to
the grant of mining lease without the clearance of the State  Government  in
accordance with the procedure specified in the notification.  Rejecting  the
contention made by the lessee this Court observed:-

“77. We are unable to accept the contention that the notification dated  27-
1-1994 would not apply  to  leases  which  come  up  for  consideration  for
renewal after issue of the notification. The notification mandates that  the
mining operation shall not  be  undertaken  in  any  part  of  India  unless
environmental clearance by the Central Government  has  been  accorded.  The
clearance under the notification is valid for a period  of  five  years.  In
none of the leases the requirements of the notification were  complied  with
either at the stage of initial grant of the mining lease or at the stage  of
renewal. Some of the leases were fresh leases granted  after  issue  of  the
notification. Some were cases of renewal. No mining operation  can  commence
without  obtaining  environmental  impact  assessment  in   terms   of   the
notification.”


35.   Considering the entire  facts  of  the  case  and  the  law  discussed
hereinabove, we are of the definite opinion that the  respondent  Darjeeling
Dooars Plantations (Tea) Ltd. is liable to pay salami which is  one  of  the
conditions of the Rules for the purpose of renewal  of  lease.   The  demand
made by the Collector is fully justified.  The impugned order passed by  the
High Court, therefore, cannot be sustained in law.

                        Civil Appeal No.2548 of 2006

 (State of West Bengal and others vs. Calcutta Mineral Supply Co. Pvt. Ltd.
                                and another)


36.   We have heard Mr. Rakesh Dwivedi,  learned  senior  counsel  appearing
for the appellant-State and also Mr. Jaideep Gupta, learned  senior  counsel
appearing  for  the  respondent-company.  In  this  case,  indisputably  the
respondent was  in  possession  of  the  land  measuring  about  4.54  acres
comprised in a factory or mill together with structures when WBEA  Act  came
into force in 1954.  After the said  Act  of  1953  came  into  effect,  the
company was allowed to retain all the lands comprised in the factory by  the
respondent by reason of Section 6(1)(g) read with Section 6(3)  of  the  Act
as the State Government was of the opinion that  the  Company  required  all
the lands for the purpose of the factory.  It is also not  in  dispute  that
at all point of time the respondent-company was holding the land of  factory
within the ceiling limit as provided under the  WBEA  Act  and  West  Bengal
Land Reforms Act.



37.   Mr. Gupta,  learned  senior  counsel,  rightly  submitted  that  after
coming into effect  of  the  aforesaid  Act  no  order  was  passed  by  the
concerned authority against the respondent since the land  held  by  it  was
well within the ceiling limit.  The High Court, while considering  the  case
of the respondent, came to the following conclusion:


“28. Once the WBLR Act becomes effective  and  a  person  becomes  a  raiyat
within  the  meaning  of  Section   4   thereof,   he   cannot   have   dual
characteristic, one under the WBEA Act and the other under the WBLR Act.  It
is not at the convenience or whims of the State that it will resort  to  the
provisions of the one or the other Act according  to  its  own  convenience.
The law is governed by the statute. There is no scope  of  arbitrariness  or
whims or caprice in the exercise of  power  or  discretion,  left  with  the
State to treat a raiyat in a manner that suits the State  according  to  its
own convenience. It is only Section 14Z, which  governs  the  field  and  to
which the State can resort to. The whole exercise of  the  power  under  the
WBEA Act in this case is wholly without jurisdiction and  the  exercise  can
no more encroach upon the field governed by Section 14Z of the WBLR Act.


28.1. In this case, admittedly, the writ petitioner held land  comprised  in
mill and factory measuring about  4.54  acres,  which  is  well  within  the
ceiling both under the WBEA Act and WBLR Act. Therefore,  retention  of  the
land under Section 6(1) could not be subjected to Section 6(3) of  the  WBEA
Act, which applies in respect  of  land  held  in  excess  of  the  ceiling.
Similarly, Section 14Z(2) of the WBLR Act applies to land held by  a  raiyat
in excess of the ceiling. Once  the  writ  petitioner  became  a  raiyat  by
virtue of operation of Section  3A  read  with  Section  4  along  with  the
amendment of the definition of land in Section 2(7) of  the  WBLR  Act  with
heritable and transferable right in respect of land held by him  within  the
ceiling, there is no scope for application of Section 14Z(2) of that Act.


Order:


29. Therefore, the order passed by the  Deputy  Secretary/Special  Secretary
on 20th of July, 2001 (pp. 65-78) upholding the notice and the notice  dated
10th of August, 2001 (pp. 76-77) issued by the Sub-Divisional Land and  Land
Reforms Officer, Barrackpore, for enquiry and  possession  pursuant  thereto
and the order dated 18th  January,  2001  passed  by  the  learned  Tribunal
affirming the order passed by the Deputy Secretary being  subject-matter  of
this writ petition cannot be sustained and are hereby quashed.  Let  a  writ
of certiorari do issue accordingly.”



38.   Having regard to the facts of the case  of  the  respondent  and  also
regard being had to the fact that the respondent at all point of  time  held
the land within the ceiling limit, the High Court rightly  set  aside  order
dated 29th July, 2011 passed by the Special Secretary upholding  the  notice
issued by the Sub-Divisional, Land and Land Reforms Officer.  Therefore,  we
do not find any reason to interfere with the order passed by the High  Court
so far this case is concerned.



39.   For the reasons aforesaid, Civil Appeal No.2549  of  2006  (Collector,
Jalpaiguri and another vs.  Darjeeling Dooars  Plantations  (Tea)  Ltd.  and
another) is allowed and the judgment and order passed by the High Court,  in
W.P.L.R.T. No.288 of 2005, is set aside.  Whereas Civil  Appeal  No.2548  of
2006 (State of West Bengal and others vs. Calcutta Mineral Supply  Co.  Pvt.
Ltd. and another) is dismissed. However, there  shall  be  no  order  as  to
costs.

                                                              …………………………….J.
                                                                (M.Y. Eqbal)



                                                              …………………………….J.
                                                               (Amitava Roy)
New Delhi
May 06, 2015



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