National Insurance Company Limited Willingdon Island Divisional Office v Board of Trustees, Cochin Port Trust; Tariff Authority for Major Ports (two connected writ petitions: WP(C).No.29 of 2015 and WP(C).No.5974 of 2015)

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR. JUSTICE SHAJI P.CHALY** **WEDNESDAY, THE 04TH DAY OF SEPTEMBER R 2019 / 13TH BHADRA, 1941** ## **WP(C).No.29 OF 2015(C)** ## **PETITIONER:** **NATIONAL INSURANCE COMPANY LIMITED WILLINGDON ISLAND DIVISIONAL OFFICE, COMMERCIAL UNION HOUSE, MARAR ROAD, WILLINGDON ISLAND, 682003, REP.BY ITS SENIOR DIVISIONAL MANAGER, MR.R.KARUPPAIAH** **BY ADVS. SRI.V.M.SYAM KUMAR SMT.KRIPA ELIZABETH MATHEWS SMT.C.B.SUMA DEVI** ## **RESPONDENTS:** **1 BOARD OF TRUSTEES COCHIN PORT TRUST, PORT TRUST OFFICE, WILLINGDON ISLAND, ERNAKULAM, PIN 682009 REP.BY THE CHAIRMAN COCHIN PORT TRUST. 2 CHAIRMAN COCHIN PORT TRUST, WILLINGDON ISLAND, ERNAKULAM, PIN 682009 3 CHIEF ENGINEER COCHIN PORT TRUST, WILLINGDON ISLAND, ERNAKULAM, PIN 682009 4 TARIFF AUTHORITY FOR MAJOR PORTS 4TH FLOOR, BHANDAR BHAVAN, M.P.ROAD, MAZAGON, MUMBAI 400 010** **R1 BY ADV. SRI.V.ABRAHAM MARKOS SRI.ABRAHAM JOSEPH MARKOS SRI.NOBY THOMAS CYRIAC R4 BY ADV. SHRI.P.VIJAYAKUMAR, ASG OF INDIA** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 14-082019, ALONG WITH WP(C).5974/2015(V), THE COURT ON 4.9.2019 DELIVERED THE FOLLOWING:** **WP(C).29/2015 & 5974/2015** **2** ## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR. JUSTICE SHAJI P.CHALY** **WEDNESDAY, THE 04TH DAY OF SEPTEMBER 2019 / 13TH BHADRA, 1941** **WP(C).No.5974 OF 2015** ## **PETITIONERS:** **1 COCHIN PORT LEASEHOLDER'S ASSOCIATION WILLINGDON ISLAND, COCHIN, REPRESENTED BY ITS HON. SECRETARY, MR.VINESH D KHONA. 2 T.K.PARVATHY W/O.LATE R.V.SUNDARAM, 34, NEW SIDE MANOR, 58 MECHANICAL ROAD, CHETPET, CHENNAI - 31.** **BY ADVS.** **SRI.N.NANDAKUMARA MENON (SR.) SMT.ROSY GEORGE SMT.KRIPA ELIZABETH MATHEWS SMT.C.B.SUMA DEVI SRI.V.M.SYAM KUMAR** ## **RESPONDENTS:** **1 BOARD OF TRUSTEES ,COCHIN PORT TRUST COCHIN PORT TRUST, PORT TRUST OFFICE, WILLINGDON ISLAND, ERNAKULAM, PIN - 682 009. 2 CHAIRMAN COCHIN PORT TRUST, WILLINGDON ISLAND, ERNAKULAM, PIN - 682 009. 3 CHIEF ENGINEER COCHIN PORT TRUST, WILLINGDON ISLAND, ERNAKULAM, PIN - 682 009. 4 TARIFF AUTHORITY FOR MAJOR PORTS 4TH FLOOR, BHANDAR BHAVAN, M.P.ROAD, MAZAGON, MUMBAI - 400 010.** **R1 TO R3 BY ADV. SRI.V.ABRAHAM MARKOS R4 BY ADV. SHRI.P.VIJAYAKUMAR, ASG OF INDIA** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 14-08-2019, ALONG WITH WP(C).29/2015(C), THE COURT ON 4.9.2019 DELIVERED THE FOLLOWING:** **WP(C).29/2015 & 5974/2015** **3** ## **J U D G M E N T** These writ petitions are materially connected, filed by the Cochin Port Trust Lease Holders' Association and Members of the Association respectively raising a common question as to the liability of the tenants to pay rent consequent to the notification issued by the Tariff Authority for Major Ports (TAMP)overlooking the current rent agreements executed by and between the tenants and the Cochin Port Trust. Therefore, I heard them together and I propose to pass this common judgment. The facts and documents contained in W.P.(C) No.5974/2015 are relied upon for the disposal of the writ petitions and narration of separate facts are not required since they are typical, and the findings rendered in the said writ petition will guide the fate of other writ petition. 2. First petitioner, is a registered association of lease holders, who have taken on lease properties from Cochin Port Trust and the 2[nd] petitioner is the **WP(C).29/2015 & 5974/2015** **4** lessee, who is a member of the 1[st] petitioner association. Case of the petitioners is that, Cochin Port Trust has let out various extents of lands at Willingdon Island and have entered into respective lease agreement with each such persons. Ext.P1 is the lease agreement entered into by and between the 2[nd] petitioner and the 1[st] respondent, which is subsisting till 9.11.2020. The lease agreement specifically provides that, the lessee shall provide the lesser during the term of the lease an yearly rent clear of all deductions. As per the lease agreement, the 1[st] respondent can effect increase in lease rent subject to a lock in period of every 7 years from the relevant date and such increase shall not exceed 100% of the existing rent that too only if there has been a decision to increase the rate of rent applicable to the relevant category of land in the concerned land use pattern. 3. It is also pointed out that, the terms and conditions of the lease including the lease rent payable and increases that could be effected thereto, are specifically provided in the lease **WP(C).29/2015 & 5974/2015** **5** agreement and both sides are bound by such terms and conditions in the lease agreement and the petitioners have been duly complying with their part of the agreement. However, 3[rd] respondent i.e., the Chief Engineer of the Cochin Port Trust has now issued Ext.P2 letter dated 3.9.2014 to the 2[nd] petitioner and all lease holders, which according to the petitioners, without any authority under law and without prior consultation or hearing, substantially increasing the lease rent payable which has the effect of singularly altering the terms and conditions of the lease agreement, thus seriously causing prejudice and loss to the petitioners. Apparently the 2[nd] petitioner has issued a reply stating that 2[nd] petitioner is not liable to pay any rent as is demanded by the 3[rd] respondent overlooking the covenants contained under the lease agreement, evident from Ext.P5 dated 4.11.2014. It is pointed out in Ext.P2 as well as Ext.P5 that, respondents are duty bound to raise the claim raised against the 2[nd] petitioner and other similarly situated persons since Notification No. G160 dated 11.6.2010 is **WP(C).29/2015 & 5974/2015 6** issued by the Tariff Authority for major ports and therefore the tenants are duty bound to pay the rent in accordance with the aforesaid notification issued by TAMP. These are the basic basic background facts projected by the petitioners in both the writ petitions. 4. A detailed statement is filed by respondents 1 to 3 commonly in both the writ petitions refuting the allegations and claims and demands raised by the petitioners. The execution of the lease agreements by and between the Port Trust and tenants are all admitted by the respondents, there is also no dispute with respect to the covenants contained under such agreements, and the rate of rent agreed upon by and between the parties. But it is submitted that, as per section 2(aa) of the Major Port Trusts Act, 1963, 'Authority' is defined as Tariff Authority for Major Ports, i.e., the 4[th] respondent in the writ petitions. Under section 49(1)(c) of the Act, 1963, the 1[st] respondent can lease its land only at the rates fixed by the 4[th] respondent. Prior to the constitution of the 4[th] respondent, fixation of **WP(C).29/2015 & 5974/2015** **7** rent was done with the approval of the Central Government by notification in the gazette in terms of the erstwhile section 52 of the Act, 1963. Under such power, the Central Government issued notification dated 6.9.2016, which is produced as Ext.R1(a). While so when the 1[st] respondent proposed an increase in lease rents in 1990, it was challenged before this court by various lessees and ultimately the writ petitions as well as appeals were disposed of by Exts.P3 common judgment, by a Division Bench of this Court, dated 10.7.2003, which was affirmed by the Apex Court in CA Nos.68056811 of 2004. It is also submitted that, by virtue of Ext.P3 judgment, the issues now raised by the petitioners as to the authority to seek payment of rent in accordance with the TAMP notification cannot be challenged at all. However, during the pendency of the case, the Act, 1963 was amended and TAMP was constituted as the appointing authority. Therefore, now the approval of TAMP is necessary for fixing lease rentals or for any subsequent increase in lease rentals also. **WP(C).29/2015 & 5974/2015 8** 5. Thereafter, the 1[st] respondent had made various proposals to the 4[th] respondent i.e., TAMP from time to time for approving enhancement of rates relating to both the vessel related charges and lease rentals. While the respondents approved enhancement of various charges by orders issued in 2004, 2007 etc., the 4[th] respondent did not revise lease rentals for various reasons and directed the Port to file further applications after providing various other information and therefore, the lease rentals as per Ext.P1 issued in 1996 is continued. But it is relevant to note that, the 4[th] respondent has issued Ext.R1(b) order during June, 2010 enhancing the base lease rent. So also it is submitted that, while submitting the proposal to TAMP for revising the lease rentals, though 1[st] respondent has sought to differentiate the lease into two categories i.e., prior to 1.1.1996 and after 1.1.1996, it was declined by the 4[th] respondent and approved the proposal to enhance the lease rentals uniformly. Accordingly, taking into consideration that the Port had the right under the **WP(C).29/2015 & 5974/2015 9** lease agreement to increase the base lease rent after every block period of 7 years starting from 1.1.1996 by an amount not exceeding 100% of the existing rent and after taking into consideration annual escalation of 5% and 2% permitted by the TAMP orders, the lease rent for the lessees was re-fixed by the Board of the Port. That apart it is submitted that Central Government is vested with powers under section 111 of Act, 1963 to issue directions to the Board of the Port Trust, and the Authority is duty bound to discharge the functions under the Act. That apart it is pointed out that, in accordance with the powers so conferred under the Act, various policy guidelines are issued by the Central Government and the respondents have no other options than to implement the same in accordance with the directions issued and in accordance with law. 6. Therefore, the sum and substance of the contention advanced by respondents 1 to 3 is that, they are only implementing the directions issued by the 4[th] respondent and merely because rent agreements were executed by and between the parties on and **WP(C).29/2015 & 5974/2015 10** w.e.f. from the issuance of Ext.R1(b)order, variation in the rent will have to be paid by the lessees. 7. Fourth respondent has also filed a detailed counter affidavit justifying the stand adopted in Ext.R1(b)order. It is also pointed out that, petitioners have not challenged Ext.R1(b) order issued by the TAMP and mere challenge on the notices issued by the 3[rd] respondent to collect the lease rent in accordance with TAMP notification cannot be sustained under law. 8. I have heard learned Senior counsel for petitioners, Sri.N.Nandakumara Menon assisted by Adv.V.M.Shyam Kumar, learned senior counsel appearing for respondents 1 to 3, Sri.Joseph Markose assisted by Adv.Isaac Thomas and learned ASGI Sri.P.Vijayakumar assisted by Smt.S.Krishna, CGC, and perused the pleadings and documents on record. 9. The sole question emerges for consideration is, whether during the currency of the lease executed by and between the petitioner - lessees and the Cochin Port Trust, enhancement of rent can be **11** ## **WP(C).29/2015 & 5974/2015** demanded overlooking the rental arrangement agreed upon by and between the parties under the lease arrangement? Section 47A is incorporated into the Act, 1963, by which Tariff Authority for Major Ports is constituted with Chair Person and several members as is specified thereunder on and w.e.f. 9.1.1997. So also section 49 dealing with scale of rates and statement of conditions for use of property belonging to Board is amended. Board is defined under section 2(b) of Act, 1963 to mean “ in relation to a port, the Board of Trustees constituted under this Act for that port.” 'Authority' is defined under section 2(aa) to mean “Tariff Authority for Major Ports constituted under section 47A of Act, 1963.” Therefore, as per section 49(1), the Authority shall, from time to time, by notification in the official gazette, also frame a scale of rates on payment of which, and statement of conditions under which, any property belonging to, or in the possession or occupation of, the Board, or any place within the limits of the Port or the Port approaches may be used for the purposes specified **WP(C).29/2015 & 5974/2015** **12** under clauses a to d. clause c is relevant to the context, which read thus: _“leasing of land or sheds by owners of goods imported or intended for export or by steamer agents.”_ 10. As per sub-section (2) thereunder, the Authority is vested with the powers to permit different scales and conditions for different classes of goods and vessels. However, by virtue of the powers conferred under sub-section (3) thereunder, notwithstanding anything contained under sub-section (1), the Board may, by auction or by inviting tenders, lease any land or shed belonging to it or in its possession or occupation at a rate higher than that provided under sub-section (1). Section 53 of Act, 1963 confers powers on the Board only to grant exemption from, and remission of, rate or charges, which stipulates that; a Board may, in special cases and for reasons to be recorded in writing, exempt either wholly or partially any goods or vessels or class of goods or vessels from the payment of any rate or any charge leviable in respect thereof according to any scale in force **WP(C).29/2015 & 5974/2015** **13** under the Act, or remit the whole or any portion of such rate or charge so levied. It was accordingly under the powers conferred on the Authority under section 49(1), Annexure A order dated 4.5.2010 is issued by the 4[th] respondent wherein clause x(a) and ## (b) are relevant: _“(a) The Cochin Port Lease Holders Association and the Cochin Chamber of Commerce and Industry have contended that the base rent of the leases executed for a period of thirty years cannot be varied legally during the existence of the period of lease. They have also contended that the long term leases being a statutory contract, in the absence of the statute specifically providing for a variation of the rent, it is not legally permissible to vary the rent during the currency of the lease. The port in reply to this contention has stated that a specific clause stating that “the base lease rent will undergo upward revision after every block of 5 years based on the then existing Scale of Rates” is incorporated in all the lease deeds entered into after 1 January 1996 and in the case of land allotted before 1 January 1996 the lease deed clearly states that the lessor has the right to increase the lease rent after every 5 years by an amount not exceeding 100%._ _b) The lease agreements on the lands allotted/renewed prior to 1 January 1996 at_ **WP(C).29/2015 & 5974/2015** **14** _Willingdon Island reportedly contain a clause to the effect that the ceiling increase in rentals should be limited to 100% of the original rate mentioned in the agreements. Since revision based on market value cannot be resorted in these cases., the port has proposed to hike the rate in rentals at 100% of the original rates as of 1 January 1996 and has accordingly proposed a separate section in the draft SOR in this regard. In this context it is worth mentioning that the rates to be prescribed in the SOR are ceiling levels. The revised rates approved by this Authority are to be applied in the existing leases as per the provisions of periodic revision of rents agreed in the surviving lease agreements. It is, therefore, not considered necessary to fix separate lease rentals for the lands allotted/renewed prior to 1 January 1996 at Willingdon Island as proposed by the Port.”_ Clause xix also is relevant which read thus; _“when the lease rentals were earlier approved by the Government, it was with a 5% annual escalation on cumulative basis. This annual escalation of 5% was challenged by the lease holders association and others and the Honourable High Court of Kerala by a common judgment dated 10 July 2003 has held that the 5% annual escalation should be on base rent and not on cumulative basis. As understood from the Port, the Government of India, COPT and some_ **WP(C).29/2015 & 5974/2015** **15** _lessees have moved Special Leave Petitions (SLP) before the Hon'ble Supreme Court and these cases are still pending for decision of the Hon'ble Supreme Court. It is, therefore, clarified that, the Order being passed on the COPT's proposal by this Authority for revision of lease rentals shall apply to the extent it is not inconsistent with the orders to be passed by the Hon'ble Supreme Court. Further, the revised rates approved by this Authority, which are in any case ceiling rates, are to be applied in the existing leases strictly as per the provisions of the surviving lease agreements about periodic revision of the lease rents.”_ As I have pointed out earlier, the Apex Court has affirmed Ext.P3 judgment of this court and paragraph 8 of the said judgment is relevant to the context, which read thus: _“Section 49(1)(c) of the Major Port Trusts Act,_ _1963, also envisages fixation of rent by the Board with Government approval and notification thereof in the Gazetee in terms of Section 52. Therefore, when there is a notification, the rate of rent is not a matter for agreement between the Port Trust and the concerned lessees. The lessees have to pay and the Cochin Port Trust can only demand that much rent_ ## **WP(C).29/2015 & 5974/2015** ## **16** _which has been notified by the Government. The petitioners did not have a case before us that the rent made mention of in the draft lease deed like Ext.P7 sent to the concerned lessees is not one notified by the Government of India”_ In paragraph 9 therein it is laid down that _“Necessarily, for the period beyond the original lease deed, during which the concerned lessees continued the occupation of the premises, the rent made mention of in the draft agreement like Ext.P7 shall have to be paid by the respective lessees, subject to the enhancement that if any, permissible in terms of the agreement between the parties, until the basic rate is enhanced by a subsequent notification”._ 11. SO also it is evident from Annexure A that, a joint hearing was held on 20[th] June, 2009 at Cochin Port Trust and the concerned users made their submissions and the point raised by the Cochin Port Trust Lease Holders' Association as well as Cochin Port Trust are summarised. It was thereafter a proposal was made by the Cochin Port Trust and again a joint hearing on the Ports' proposal dated 17.8.2009 was held on 23.2.2010 at Cochin Port Trust and the Cochin Port Trust and the concerned users **WP(C).29/2015 & 5974/2015** **17** made their submissions. The gist of the submissions made by the respective parties are also recorded therein. 12. It is an admitted fact that, Annexure A TAMP order is not under challenge in the writ petitions. The sole challenge made by the petitioners is against the demands raised as per Exts.P2 and P5 on the basis of the TAMP order. Therefore, one thing is clear that, the decision was taken by the 4[th] respondent after providing sufficient opportunity of hearing and participation to all stake holders. Anyhow section 111 of Act, 1963 deals with power of Central Government to issue directions to the Board, which is relevant to the context: ## “ **111** . **Power of Central Government to issue** ## **directions to Board;** [(1)] Without prejudice to the foregoing provisions of this Chapter, the Authority and every Board shall, in the discharge of its functions under this Act be bound by such directions on questions of policy as the Central Government may give in writing from time to time. Provided that the Authority or the Board, as the case may be, shall be given opportunity to express its views before any direction is given **WP(C).29/2015 & 5974/2015** **18** under this sub-section. (2) The decision of the Central Government whether a question is one policy or not shall be final. 13. Therefore, when a lease deed is executed by and between the parties, one can only visualise that, the lessee as well as the Board and the Authority are aware that they are duty bound to take appropriate action in accordance with law and as per the directions issued by the Central Government. It is also significant to note that, Annexure A order is issued by the TAMP during June, 2010, however, no challenge was made to the said notification by any of the lease holders though they participated in the proceedings initiated by TAMP. All the points raised in these writ petitions were raised before the 4[th] respondent and after taking into consideration all the grievances highlighted by the lessees and the Cochin Port Trust, the said order was issued by the TAMP. 14. Learned counsel appearing for petitioners submitted that 1[st] respondent has not produced any board resolution enabling the respondents to issue **WP(C).29/2015 & 5974/2015 19** demand notice against the petitioners. However, consequent to the oral direction issued by this court on the final date of hearing, resolution dated 27.5.2014 is produced and as per the resolution it is evident that, the issue in question was discussed and decided to take appropriate action in accordance with the proviso to section 56(1) of Act, 1963, which prescribes a two year period of limitation in order to recover the money short levied. It was taking into account the limitation prescribed thereunder, demand notices were issued against the petitioners. Therefore, it is clear that, it was on the basis of the resolution adopted by the Board of Trustees of Cochin Port Trust, the demands were raised by the 3[rd] respondent. 15. I have evaluated the rival submissions made across the Bar and I am of the considered opinion that, the Cochin Port Trust, a department of the Union Government normally make contracts in their own name but for and behalf of the Government, so that, the enforcement of contract is guided and governed by provisions of the Act, 1963. While **WP(C).29/2015 & 5974/2015** **20** interpreting a commercial contract, a broader and expansive approach shall be made, to understand the letter and spirit of the contract by and between the parties. If it is found that there is evasion of public policy by overlooking the provisions of a statute, then there is nothing wrong in stepping in and rectifying the illegalities though such an action is warranted consequent to amendment of law. After all the contract was executed by and between the parties to have a specific period of tenancy predominantly, and agreeing to comply with the obligation and covenants respectively undertaken by the parties. True, the rent is agreed upon by and between the parties taking into account the existing conditions such as market value of the property, importance of the locality, proximity with public institutions, access to conveyances, commercial benefit and advantages etc. etc. That doesn't mean that, such situations remain static and there is every likelihood of the potential of the property enhances to the advantage of the landlord and merely because a rent is agreed upon, in my considered **WP(C).29/2015 & 5974/2015 21** view, that will never create a fetter to the landlord to seek enhancement of the rent. Likewise, nothing stands in the way of Government amending the statute to suite its convenience in the matter of fixation of rent. So also the Government is at liberty to amend the laws empowering an authority to fix rent and when such authority exercises its statutory power so conferred, it is binding on the lessee and the agreement by and between the parties stands modified to the extent of the incorporated provisions, thereby rendering statutory duty on the tenant to comply with the statutory requirements as amended. Which thus means, a covenant in a contract shall only be subservient to the provisions of the statute. 16. To put it otherwise, certain conditions of contract are mandatory while certain others are flexible, liable to be varied on account of various situations as discussed above. So also on a close scrutiny of the terms and conditions of the contract and read as a whole harmoniously, it is clear and evident that, there is no prohibition created **WP(C).29/2015 & 5974/2015** ## **22** disabling the landlord to seek performance by the tenant in accordance with the amendment of the statute and consequential action, failing which, the whole contract will become illegal and against the public policy. 17. It is also well settled law that, any agreement between the parties has to be in accordance with the statutory provisions in effect. It means, when a provision of a statute has undergone a change, any covenant and terms and conditions of a contract inconsistent with the statutory provisions will become void and redundant and such covenants shall not have any credence or efficacy thereafter and therefore to be ignored to satisfy the requirements mandated under law. 18. So much so in the case on hand there is no difficulty for severance of the covenants contained in the contract executed by and between the parties from the rest of the contract in order to satisfy the requirements of the TAMP order. That apart on a reading of the newly incorporated statutory provisions and the notification issued by the TAMP, **WP(C).29/2015 & 5974/2015** **23** it is clear that, no manner of prejudice will be caused to the covenants agreed upon by the parties due to the severance of objectionable stipulations on account of the statutory powers exercised by the 4[th] respondent and the consequential Annexure A order. Indeed, all agreements in violation of law are unlawful. Section 23 of the Contract Act, 1872 makes it clear, a contract entered into against public policy is void. 19. That apart the terms of a contract is the outcome of a mutual negotiation or settlement of terms and conditions by and between the parties. Such consensus are arrived at by the parties mostly on the basis of subjective satisfaction derived through personal opinions and perceptions. It is an admitted fact that, prior to the amendment of Act, 1963 specified above and formation of TAMP, the Board of Cochin Port Trust was at liberty to enter into negotiation with the lessees and mutually settle the terms and conditions of the agreement, which may have force of law only when a notification is published in the gazette by the Central **WP(C).29/2015 & 5974/2015** **24** Government. But when an authority is conferred with power under a statute to deal with any given situation, such authority has to objectively assess the issue in terms of law and arrive at the conclusion. Therefore, even if there is a term advantageous or disadvantageous to the tenant, when an authority constituted under the statute has issued a notification fixing rental, the Board in the instant case has no other way than to abide by the rate fixed by the authority. 20. Moreover, as I have pointed out earlier, order was issued by TAMP after providing sufficient opportunity to the lessees as well as Port Trust to submit their views and it was after appreciating the rival submissions made alone, decisions were arrived at by TAMP. So also unless and until the statute itself protects the existing tenancy from being disturbed or being interfered with from the consequences of amendment, the covenants under the contract by and between the parties cannot save the situation as is claimed in the writ petitions. That apart there is no power vested with the Board of **WP(C).29/2015 & 5974/2015 25** Cochin Port Trust to overlook the orders issued by the TAMP constituted as per the provisions of Act, 1963 and the demand made for the rent accordingly is only a sequel to the TAMP order. To put it otherwise, provisions of a statute has primacy over provisions of an agreement executed by and between the parties if it is remaining against the provisions of the statute. 21. In this context, judgment of the Apex Court in **Dr.S.K.Kacker v. All India Institute of Medical** **Sciences** [(1996)10 SCC 734] is relevant though it deals with service law, in my considered view, it has a role to play in respect of the importance and efficacy of statutory rules. It is laid down in paragraph 12, as follows: _"_ _**12.** Shri Jaitley placed strong reliance on the resolutions passed by the Governing Council permitting the appellant to continue as Professor and Head of the Department and approval thereof by the Institute Body. That was also reflected in the counter-affidavit filed by the Union of India indicating that his superannuation as Professor is on 31-7-1998. That would mean that he was allowed to continue as a Professor and that, therefore, he is entitled to revert as Professor and Head of the Department. It is true that such resolutions came to be passed. The question, however,_ **WP(C).29/2015 & 5974/2015** **26** _is whether such resolutions have statutory basis? They are by their very nature administrative resolutions passed by the authorities. When, admittedly, Dr Kacker is a permanent government servant governed by the Fundamental Rules, he cannot hold two substantive posts at the same time, namely, the post of Professor and Head of the Department and also the post of Director. In view of the findings recorded hereinbefore, the appellant lost his lien in the post of Professor and Head of the ENT Department on his substantive appointment to the post of Director.Therefore, such resolutions which are inconsistent with the statutory rules have no role to play nor do they have any legal efficacy. The administrative instructions would only supplement the yawning gaps in the statutes but cannot supplant the law. The resolution is, therefore, a self-serving one without legal back-up."_ 22. So also the Allahabad Court in **Kamta Prasad** ## **v. Additional District Judge Mainpuriand others** [AIR 1997 Allahabad 201] had considered a typical question vis-a-vis the Indian Contract Act, 1872 and the executability of a decree. Paragraph 16 of the judgment is relevant to the context which read thus: _"That apart, when the statute allows such decree or contract unenforeale by operations of law even if no application is made and the attention of the Court is drawn to such a situation, it is the duty of the executing Court to examine and find out as to whether the decree is executable. Inasmuch as it_ **WP(C).29/2015 & 5974/2015** **27** _goes to the root of the jurisdiction of the executing Court, namely as to whether the executing Court has jurisdiction to execute the same."_ 23.Learned Senior counsel appearing for respondents 1 to 3 has also invited my attention to the judgement of the Apex Court in **National Sample** ## **SurveyOrganisation and Another v. Champa Properties** **Limited and Another** [(2009)14 SCC 451], there the question considered was, determination of rent by the hiring committee not statutorily or contractually binding on the parties. Apex Court has held that, in the absence of an express contract agreeing to be bound by such recommendations, they are neither binding on the hiring department nor on the lessors. Paragraph 30 to 32 are relevant to the context, which read thus: _**"30.** We are of the view that the elaborate decision in Rabindra Nath Nandi missed the core issue and ignored the relevant law governing landlords and tenants. A lease is governed by the terms of the contract (deed or agreement of lease) between the parties. If the contract prescribes a rent for the period of lease, the same being agreed rent, it is binding on the parties. If the lease provides for revision of rents periodically,_ **WP(C).29/2015 & 5974/2015** **28** _and specifies the method and manner of revision, such revised rent would also be the agreed rent._ _**31.** Where a statute governing tenancies and/or rents provides for fixation of rent or increases in rent, and such statute is applicable to the tenancy in question, then the rent will have to be determined in accordance with the statutory provisions. Subject to the above, any increase can be only by the consent of the parties. If the lease period expires and the parties are not able to agree upon the increase in rent or terms of renewal, it is open to the landlord to initiate action for_ _evicting the tenant. But under no circumstances can the landlord require the tenant to pay during the period of a lease, a rent higher than what is agreed between them or what is provided for in the statute._ _**32.** The assessment or determination of rent by the Hiring Committee is an expert advice to the lessee and nothing more. Except where there is an agreement to abide by the fixation of rent by the Hiring Committee, neither party can insist or require the other party to abide by the rent assessed by such Committee, as determination of rent by the Hiring Committee is not statutorily or contractually binding on the parties."_ The principles of law that could be culled out from the aforesaid decisions is that when there is a **WP(C).29/2015 & 5974/2015 29** method of fixing rent statutorily, the same will have to be followed, failing which, the agreement of contract will become void to that extent. Taking into account all these aspects, I am of the considered opinion that, petitioners have not made out any case of arbitrariness, illegality or unfairness on the part of the respondents in raising demand notice against the individual lease holders during the currency of lease executed by and between the parties. Upshot of the discussion is, writ petitions fail, accordingly they are dismissed. ## **Sd/-** ## **SHAJI P.CHALY** Smv 30.8.2019 **JUDGE** **WP(C).29/2015 & 5974/2015** **30** ## **APPENDIX OF WP(C) 29/2015** ## **PETITIONER'S EXHIBITS:** **EXHIBIT P1 EXT.P1 - TRUE COPY OF THE LEASE AGREEMENT DTD.21-6-2001 ENTERED INTO BETWEEN THE 1ST RESPONDENT AND PETITIONER EXHIBIT P2 EXT.P2 - TRUE COPY OF THE LETTER DTD.03-092014 BEARING NO.EM11/REVISION OF LEASE RENTS/2014 ISSUED BY THE 3RD RESPONDENT TO THE PETITIONER EXHIBIT P3 EXT.P3 - TRUE COPY OF THE LETTER DTD.30-92014 BEARING NO.570400/MISC/2014 ISSUED BY THE PETITIONER TO THE 3RD RESPONDENT EXHIBIT P4 EXT.P4 - TRUE COPY OF THE LETTER DTD.03-112014 BEARING NO.EM8/NICL/LEASE/2014-S ISSUED BY THE 3RD RESPONDENT EXHIBIT P5 EXT.P5 - TRUE COPY OF THE COMMON JUDGMENT DTD.10-07-2003 IN WA NO.1890 OF 1997 OF THE HON'BLE HIGH COURT. RESPONDENTS' EXHIBITS: EXHIBIT R4(A) TRUE COPY OF THE LAND POLICY GUIDELINES FOR MAJOR PORTS, 2004 ISSUED BY THE MINISTRY OF SHIPPING DATED 08/03/2004. EXHIBIT R1 A TRUE COPY OF THE NOTIFICATION DATED 06/09/1996 ISSUED BY THE CENTRAL GOVERNMENT. EXHIBIT R1 B TRUE COPY OF THE TAMP NOTIFICATION ISSUED IN JUNE, 2010. EXHIBIT R1 C TRUE COPY OF THE REVISED LETTER DATED 19/01/2015 ISSUED BY THE 1ST RESPONDENT. EXHIBIT R4(B) TRUE COPY OF THE SPEAKING ORDER DATED 04/05/2010. EXHIBIT R4(C) TRUE COPY OF THE ORDER DATED 31/08/2017 IN SPECIAL LEAVE APPLICATION NO.11751/2014 OF THE HON'BLE HIGH COURT OF GUJARAT AT AHAMEDABAD.** **APPENDIX OF WP(C) 5974/2015** **WP(C).29/2015 & 5974/2015** **31** ## **PETITIONER'S EXHIBITS:** **EXHIBIT P1 EXHIBIT P1. TRUE COPY OF THE LEASE AGREEMENT DATED 11.08.1999 ENTERED INTO BETWEEN THE 1ST RESPONDENT AND THE 2ND PETITIONER. EXHIBIT P2 EXHIBIT P2. TRUE COPY OF THE LETTER DATED 03.09.2014 BEARING NO.EM11/REVISION OF LEASE RENTS/2014 ISSUED BY THE 3RD RESPONDENT TO THE 2ND PETITIONER. EXHIBIT P3 EXHIBIT P3. TRUE COPY OF THE COMMON JUDGMENT DATED 10.07.2003 IN WA NO.1890 OF 1997. EXHIBIT P4 EXHIBIT P4. TRUE COPY OF THE REPRESENTATION DATED 20TH OCT, 2014 FILED BY THE 1ST PETITIONER BEFORE THE 2ND RESPONDENT. EXHIBIT P5 EXHIBIT P5. TRUE COPY OF THE REPLY DATED 04.11.2014 ISSUED BY THE 3RD RESPONDENT TO THE 1ST PETITIONER ASSOCIATION. RESPONDENTS' EXHIBITS: EXHIBIT R1 A TRUE COPY OF THE NOTIFICATION DATED 06/09/1996 ISSUED BY THE CENTRAL GOVERNMENT. EXHIBIT R1 B TRUE COPY OF THE TAMP NOTIFICATION ISSUED IN JUNE, 2010. EXHIBIT R1 C TRUE COPY OF THE REVISED LETTER DATED 19/01/2015 ISSUED BY THE 1ST RESPONDENT.**