Jyotinder Singh Saluja vs. Bharat Heavy Electrical LTD.

Held

The Court held that the petitioner was not liable to pay the licence fee as per the provisions of the Shop Policy, 2014, as no licence deed was executed in furtherance of the policy, and the petitioner operates an MSME industrial unit. The parties never entered into a contract under the Shop Policy, 2014. Regarding damages, the Court found that the Estate Officer erred in granting damages solely based on the Shop Policy, 2014, without cogent evidence. The respondent failed to produce evidence to prove the damages or the prevailing usage charges for surrounding properties. The awarded damages of Rs. 3,84,820/- per month, compared to the last agreed licence fee of Rs. 3,718/- per month, were deemed exorbitant and unsustainable. The order for payment of damages as per the Shop Policy, 2014, was set aside. However, the order for eviction was upheld, and the petitioner was directed to pay arrears of licence fee till September 22, 2024, at the agreed rate, with a 5% annual increment. The petitioner was granted one month to remove temporary structures and articles.

Facts

The petitioners, Jyotinder Singh Saluja and Smt. Preeti Kaur Saluja, are aggrieved by orders of the Principal District Judge, Bhopal, which upheld orders passed by the Estate Officer of Bharat Heavy Electricals Limited (BHEL), Bhopal. The Estate Officer had directed the eviction of the petitioners from leased premises and recovery of arrears of licence fee under the Public Premises (Eviction of Unauthorised Occupants) Act, 1971. The petitioners were allotted an industrial plot on a licence basis, which expired on March 31, 2011. They continued operations and paid licence fees until 2021-2022. BHEL introduced a new Shop Policy in 2014, leading to a demand for significantly enhanced licence fees, which the petitioners refused to pay. Proceedings were initiated for eviction and recovery of arrears, resulting in an order for eviction and recovery of Rs. 2,38,49,561/- towards arrears and damages. The District Judge dismissed the appeals against these orders.

Key Issues

1. Whether the BHEL Shop Policy, 2014, is applicable to the petitioner's industrial plot, considering it is located in an ancillary industrial area and the petitioner operates an MSME industrial unit, not a shop, and whether Clause 2.4 of the policy exempts industrial land allotments. Petitioner's argument: The Shop Policy, 2014, is not applicable as the petitioner runs an industry in an ancillary industrial area, not a shop in a residential area. Clauses 2.4, 3.1, and 4.3 of the policy support this. The policy is not applicable to industrial land allotments, and the petitioner's activity is commercial/trading but for industrial purposes. Respondent's argument: The Shop Policy, 2014, is applicable, as upheld by a Coordinate Bench in Writ Petition No. 11190/2016. The petitioner is engaged in commercial and trading activities. Clause 3.1 defines 'Shop' broadly for commercial/trading activities, and Clause 4 states the policy applies to fresh allotments or renewals. 2. Whether the damages awarded by the Estate Officer, calculated as per the Shop Policy, 2014, are sustainable in the absence of cogent evidence proving the damages and the market rental value of similarly situated properties. Petitioner's argument: The enhanced licence fee was unilaterally enhanced and not permissible. The Estate Officer abused powers by issuing an eviction warrant and sealing the premises. The respondent has no general lien, and the seizure was illegal. Respondent's argument: The respondent is entitled to claim damages as per the Shop Policy, 2014, as its legality has been upheld.