Nilima Hospitality @ Hospitality And Caterers Private Limited vs. The State Of Bihar

Facts

The petitioner, Nilima Hospitality @ Hospitality and Caterers Private Limited, filed a writ petition challenging a notice dated December 31, 2020, issued by the respondent. The notice directed the petitioner to deposit the lease premium for the third and final year of their lease agreement. The petitioner argued that the fast-food hotel was closed from March 2020 due to the COVID-19 pandemic and subsequent lockdowns, preventing them from operating the business. They sought to quash the demand, waive the lease premium of Rs. 2,65,000 plus 10% GST (totaling Rs. 2,96,500), and extend the lease period. The petitioner also highlighted a substantial investment of Rs. 16,00,000 in the hotel's construction and feared heavy losses if the lease was terminated.

Held

The Court disposed of the writ petition as not pressed. The petitioner was granted liberty to approach Respondent No. 3, the Managing Director of the Bihar State Tourism Development Corporation, for the redressal of their grievances. The respondent's counsel indicated that the Corporation would consider the petitioner's representation and pass appropriate orders in accordance with the law. However, the Court noted that the lease period had expired on October 11, 2021, implying that the petitioner's right to occupy the premises had ceased. The Court did not make any specific findings on the merits of the petitioner's claim for waiver of lease premium or lease extension, as the petition was withdrawn with liberty to pursue the matter at the administrative level. No issue was expressly left undecided, as the matter was disposed of on procedural grounds.

Key Issues

1. Whether the petitioner is entitled to a waiver of the lease premium for the third and last year of the lease, amounting to Rs. 2,65,000 plus 10% GST (totaling Rs. 2,96,500), considering the closure of their hotel due to the COVID-19 pandemic and subsequent lockdowns since March 2020? Petitioner's Arguments: The petitioner contended that the closure of their fast-food hotel from March 2020 due to the pandemic and government-imposed lockdowns rendered them unable to operate their business. Consequently, they sought a waiver of the lease premium for the third year and an extension of the lease period. They also emphasized their significant investment of Rs. 16,00,000, arguing that lease termination would result in substantial financial losses. Respondent's Arguments: The respondent, through their counsel, stated that the lease period for the petitioner's restaurant had already expired on October 11, 2021. Therefore, the petitioner had no right to continue occupying the premises and was required to vacate.