Khajuraho Potteries vs State of Madhya Pradesh and Others

S.K. Gangele, J—The petitioner has filed this petition for the following reliefs :

"a. Mr. Manoharlal Agrawal''s unilateral surrender of his share of the leased plots and his application for transfer of the same in favour of one Naseem Akhtar Akha be both declared illegal;

b. The third respondent''s proposed action of transferring Industrial Plots No. 17 and 18 in favour of Naseem Akhtar Khan and Mohd. Ali be quashed and set aside as contrary to law, the leased deeds and the 1974 Rules;

c. The respondents be directed to grant possession of Plots No. 17 & 18 to the petitioner firm and allow it to resume production on the same;

d. Any other relief which the petitioner is found entitled to be also granted."

The petitioner is a registered partnership firm registered under the provisions of Partnership Act. As per the petitioner, all the three partners Mr. Adarsh Mohan Khare, Mr. Manoharlal Agrawal and Mr. Manoj Agrawal were having 33%, 34% and 33% share in the partnership firm respectively. Subsequently, Mr. Manoj Agrawal was retired and Mr. Manoharlal Agrawal had 65% share in the partnership firm.

A lease was granted in favour of the petitioner by District Industries Manager, Chhatarpur on 21.08.1980 in respect of Industrial Plots No. 17 and 18, area 17,500 sq. ft. situate at Industrial Area, Chhatarpur for a period of 99 years commencing from 21.08.1980. Another lease was also granted by District Industries Manager, Chhatarpur in favour of the petitioner firm of Plot No. 5, area 7,000 sq. ft. situate at the same place for a period of 99 years commencing from 19.03.1982.

The petitioner firm did not commence production as per the terms and conditions of the lease deed. Hence, a notice was issued to the petitioner that why the lease deeds be not canceled. Thereafter, both the lease deeds were canceled by the District Industries Manager vide order dated 04.08.2006.

Against the aforesaid order, the petitioner firm submitted an appeal to the Industries Department. The Industries Department vide order dated 14.08.2007 kept in abeyance the order of cancellation of lease for a period of six months and observed that if the petitioner shall commence industrial production within a period of six months order of cancellation of lease would come to an end and if the petitioner would not commence industrial production within the aforesaid period the order of cancellation of lease shall come into operation.

As per the petitioner, it had commenced the industrial production. Subsequently, some dispute arose between the partners of the petitioner firm. Another partner Mr. Manoharlal had written a letter to the Industries Center that he had surrendered his portion of the land i.e. 65% share and the aforesaid land be allotted in favour of Naseem Akhtar Khan. Thereafter, the possession of the land was taken by the Industries Department through Sub-Divisional Officer. Against the order dated 14.11.2011, by which the possession from the petitioner was taken, the petitioner filed an appeal. When the appeal was not decided, a writ petition was filed before this Court, which was registered as W.P. No. 11180/2012. This Court vide order dated 03.08.2012 disposed of the writ petition with a direction to decide the appeal expeditiously. Thereafter, vide an order dated 12.12.2012, copy of which has been filed as Annexure P/12, the Commissioner Industries has held that Mr. Adarsh Mohan Khare, one of the partner of the firm, is eligible to get possession of Plot No. 5 area 7,000/- sq. ft.

Learned counsel for the petitioner has submitted that the petitioner is eligible to get possession of other plots No. 17 and 18 also in view of the compromise entered between the partners.

I am not in agreement with the arguments advanced by the learned counsel for the petitioner. The condition No. 7 of the lease deed executed in favour of the petitioner clearly stipulates that the petitioner has to implement the project and commence on production within a period of one year in case of small scale industry and within a period of three years in case of large and medium scale industry from the date of taking over of possession. The condition of the lease deed reads as under:

"7. The lessee hereby agree that he shall within a period of one year in the case of small scale Industry and within a period of three years in the case of Large and Medium Scale Industry from the date of his/taking over possession of land implement the project/scheme and go into production.

a. The lessee hereby agrees that he shall utilize the complete land leased out to him hereunder for implementation of the project or for its expansion within a period of three years in case of SSI, five years in case of Medium and Large Scale Industries for the above said purpose.

b. The lessee further agrees that if he is unable to utilize the complete land leased out to him within the period prescribed in clause 7(a) the lessee will surrender the surplus land to the lesser or the lesser has the right of re-entry in that portion. Lessee also agrees that if he fails to surrender the surplus land he will pay 100 times of the prevalent rate of rent."

Rule 14 of the Madhya Pradesh Industries (Allotment of Sheds, Plots and Land) Rules, 1974 (hereinafter called ''Rules of 1974''). Rule 14 prescribes the same provision. The Rule reads as under :

"14. IMPLEMENTATION OF THE SCHEME

a) Every allottee from the date of his taking over the possession of the land or building shall implement the project/scheme and go into production within a period of one year in the case of small scale industry and within a period of 3 years in the case of medium or large industry provided this period may be extended in suitable deserving cases by allotting authority by one year and by the next higher authority for any further suitable period.

b) In the case of building the allottee from the date of his taking the possession of the building shall implement the project/scheme and go into production within a period of 6 months in the case of a small scale industry and within a period of 1 year in the case of medium or large industry."

Rule 21 of the Madhya Pradesh Industries (Allotment of Sheds, Plots and Land) Rules, 1974 prescribes termination of lease, which reads as under :

"21. TERMINATION OF LEASE :

In case the lessee/lessees or his/their transferees or assignees commit any of the conditions specified in the lease deed then the allotting authority shall give notice in writing to the lessee/lessees or his/their transferees or assignees as the case may be asking him/them to remedy the breach within 60 days from the date of the notice and if breach is not remedied within such period, the allotting authority may determine the lease provided that nothing herein contained shall debar the State Govt. from enforcing any other right or remedy that the State Govt. may have against the lessee/lessees or his/their transferees or assignees under any other provisions herein contained."

From the aforesaid Rules, it is clear that if lessee contravenes the terms and conditions of the lease and did not remedy the breach within 60 days from the date of notice, the lease shall be canceled. In the present case, the petitioner was granted 6 months'' time by the appellate authority to commence the production. The order of the appellate authority is dated 04.08.2006. Mr. Adarsh Mohan Khare in his statement made before the appellate authority, which is noted by the appellate authority in the order dated 12.12.2012, himself admitted that the production in the unit was not commenced. He further stated that he wants to commence the production. From the statement of the Mr. Adarsh Mohan Khare, it is clear that in 6 months the unit did not commence the production. The Industries Department had taken the possession of the plot. In such circumstances, the petitioner has no right to get back the possession of Plot No. 17 & 18. The petitioner may be lucky that the Commissioner Industries vide order dated 12.12.2012 ordered that the possession of Plot No. 5 be handed over to the petitioner in spite of breach of condition of lease deed by the petitioner.

Apart from this as pleaded by the respondents in the return, the petitioner also filed a civil suit before the District Court, Chhatarpur against cancellation of lease. The civil suit is registered as Civil Suit No. 17-A/2013 and pending adjudication before the Civil Judge, Class I, Chhatarpur.

In such circumstances, I do not find any merit in this petition. It is hereby dismissed.

No order as to costs.