Vinayaka Missions Lord Jagannath Institute of Dental Science and Research vs State of Orissa and Others

B.K. Nayak, J.—In this writ application the Petitioner Vinayaka Missions Lord Jagannath Institute of Dental Science & Research, Bhubaneswar, which is managed by a Medical Educational & Charitable Trust, challenges the Order Dated 08.12.2007 under Annexure-9 passed by the Collector, Khordha resuming the land leased out in favour of the Petitioner for running the Dental & Medical College. It is the case of the Petitioner that the Petitioner-Institution initially started functioning in 1998 in Toshali Plaza, Bhubaneswar with 60 dental students. In the year 1999 the second batch of students were admitted. The Institution was approved by the Dental Council of India for running in the premises of Toshali Plaza. Both the batches of students have completed the BDS Courses in 2004 & 2005 respectively. It is stated that initially on the application of the Petitioner for allocation of land for running the Dental & Medical college, the State Government in the Revenue & Excise Department vide their order No. 43931/R dated 30.09.1996 gave advance possession of fifty-five acres of land in Mouza Sijua & Ranasinghpur with certain terms & conditions which was subsequently by Government letter dated 18.11.1998 reduced to forty acres. However, ultimately in pursuance of direction of this Hon''ble Court vide Order Dated 11.12.2001 passed in the OJC No. 10775 of 2005, the lease deed under Annexure-2 was executed on 22.12.2001 by the Government in favour of the Petitioner for seven acres of land for 99 years with certain terms & conditions. It is stated that against all adversities, the Petitioner trust constructed around 20,000 sq. ft. plinth area with three big size rooms of 4000 square feet each for hospital, office & store on the leased out land, which was the preliminary requirement to start the Dental College in a new place. The construction was made with prior approval of plan by the Bhubaneswar Development Authority. However, after two batches of 1998 & 1999, the Petitioner''s Institution could not take up further admission due to want of permission from the Dental Council of India because of inadequate infrastructure & teaching staff. Now, the Petitioner trust has shifted all materials & instrument from the old building to the leased out land & has also installed own transformer for electrical connection after settlement of the an electrical dispute with the concerned authorities. It is stated that during the year 2005 the Petitioner received notice dated 17.10.2005 u/s 3-B of the Orissa Government Land Settlement Act, 1962 (in short ''the OGLS Act'') from the Additional Tahasildar, Bhubaneswar calling upon the Petitioner to show cause as to why the land covered under the lease deed should not be resumed u/s 3-B of the OGLS Act. The Petitioner submitted its show cause reply under Annexure-7 indicating inter alia that the land in question has not been used by the Petitioner for any purpose other than for which it was allotted/leased out, whereafter the matter was not further pursued. However again the Petitioner received a notice dated 28.7.2007 (Annexure-5) from the Collector, Khordha Opp. Party No. 3 u/s 3-B of the OGLS Act for explaining the following.

i. The institute lessee has violated Sub-clause 15 of Clause-I of the lease agreement by not using the land for the purpose of which it was sanctioned.

ii. The institute-Lessee has entered into agreement with private parties for availing loan without prior permission of the Competent Authority.

iii. The Institute lessee has also not obtained the permission of the Competent Authority for functioning of the Institute of Dental Science.

It is alleged that no detailed particulars with regard to the allegations in notice in relation to entering into agreement with private parties for availing loan & violation of Sub Clause-15 of Clause-II of the lease agreement were indicated in the notice. The Petitioner, however submitted his show cause reply under Annexure indicating that he has not violated any condition of the lease agreement. Thereafter, by Order Dated 08.12.2007 (Annexure-9) Opp. Party No. 2 intimated that the Government Opp. Party No. 1 vide their letter No. 48193/R & DM dated 07.12.2007 decided to resume the case land for Which the lease agreement was cancelled & the land was resumed to the Government.

It is submitted by the Learned Counsel for the Petitioner that the cancellation of lease of the Petitioner & resumption of land has been made by the Opp. Parties u/s 3-B of the OGLS Act for violation of Sub Clause-15 of Clause-II of the leased agreement for non-user of the land for the purpose for which it was lease out. It is his submission that Section 3-B of the OGLS Act has no application inasmuch as, the said Section contemplates resumption of land on the ground of user for any purpose other than the purpose for which it was settled or allotted. It is submitted that non-user of the land does not amount to user for any purpose other than the purpose for which it has been leased out &, therefore, the cancellation of the lease & resumption of the land in question taking recourse to Section 3-B of the OGLS Act is wholly arbitrary illegal & erroneous & therefore, liable to set aside. It is also submitted by the Learned Counsel for the Petitioner that at the behest of Opp. Party No. 2 the Director of Medical Education & training, Orissa furnished an enquiry report dated 11.4.2007 (Annexure-4) indicating therein that there is substantial civil construction with lots of chairs, cots, tables, almirahs, electrical fans, lights, medical & dental instruments, dental chairs, chemical laboratory, etc., in the leased out area along with an electrical sub station. The report also indicated that since all instruments & infrastructure are present & the ban period is over, a dental college can come up there with full strength with provision of staff etc. It is the contention of the Petitioner that since the enquiry report of the Director of Medical Education & Training, Orissa was in favour of the Petitioner, the decision of the Opp. Parties that the land is used for purpose other than the one for which it was leased out as contemplated in Section 3-B of the O.G.L.S. Act is based on no material & hence arbitrary.

A counter affidavit has been filed on behalf of the Opp. Parties stating that initially advance possession of fifty five acres of land was given to the Petitioner in 1996 for establishment of Dental Medical College & Hospital within one year & to inform the authority about such utilisation. The Petitioner having failed to utilise the land in question, it was ultimately reduced to seven acres in respect of which lease was executed under Annexure-2 & as per sub Clause-15 of Clause-II of the lease agreement the lessor has right to resume the land under Section. 3-B of the OGLS Act, if the lessee does not used the land for the purpose for which it was granted within one year of the execution of the lease. Even after one year of execution of the lease, the Petitioner has not used the land for establishment of the Dental College & Hospital but has kept some materials in the half constructed houses over the case land. Referring to the report (Annexure-4) of the Director, Medical Education & Training, it is stated that nowhere in his report the Director has stated that the land has been used by the lessee for running the Dental College & Hospital. Rather, the report corroborates the earlier reports of the Revenue Inspector & the Tahsildar regarding non-utilisation of the land for the purpose for which it was leased out. In such circumstances, the Government decided to resume the land & accordingly notices were issued to the Petitioner as per Section 3-B of the O.G.L.S. Act & after considering his reply, the Government decided to resume the land by cancelling the lease on being satisfied that the Petitioner failed to utilise the land for running the Dental Medical College & Hospital. Inquiry report of the Tahasildar, Bhubaneswar dated 21.11.2006 about non-utilisation of the land in question by the Petitioner for running the college has been annexed as Annexure-E/2. Some averments have been made in the counter affidavit regarding clandestine agreement dated 26.07.2011 entered into by the Petitioner with one M/s. Sahu Trust for transferring the control & management of the Petitioner with all assets & liabilities together with the interest in respect of forty acres of Government land. However, this Court feels that the details of such transaction are not necessary to be adverted to, since this does not constitute the ground on which the land has been resumed. It is stated further in the counter that even after the Director of Medical Education & Training submitted its report (Annexure-4), the Petitioner has not taken any steps to establish the Dental medical College & Hospital till the lease was cancelled & the land resumed. It is further stated that the Tahasildar was directed to publisher a copy of the order in the locality as well as over the case land & to take over possession of the land & for correction of record of right. The order was published as directed in presence of witnesses & the Revenue Inspector was directed to take over possession of 10.12.2007 of the case land after observing all formalities & the Petitioner (Lessee) was directed to remain present on the said date, As per the report of the R.I., Annexure-H/2, the possession of the case land was taken over on 10.12.2007 in presence of the witnesses & watchers of the Petitioner-Institution. It is thus submitted by the Learned State Counsel that there is nothing wrong to resume the land resorting to Section 3-B of the O.G.L.S. Act.

In the light of the facts & submissions noted above the question that falls for determination is whether the Government has the right to cancel the lease in question & resume the land covered thereunder the whether such resumption can be made taking recourse to Section 3-B of the O.G.L.S. Act. In order to determine the question, certain relevant terms & conditions contained in different sub clauses of Clause-II of the lease agreement are to be taken note of which are as follows:

The lessee shall not use the land hereby demised for any purpose other than the specific purpose for which the land is granted, namely establishment of a dental college & hospital.

That on breach or non-observance of any of the aforesaid condition of this indenture, the lessee may declare that the lease has been determined & that on the expiry of one month from the date of such order, the lesser or any officer or person appointed by him in that behalf be entitled to re-enter & take possession of the demised land of the building & other structure etc. erect thereon. Provided

That on the question of breach of non-observance of any of the terms or conditions of this indenture, the lesser shall be the sole judge & an order of the lesser declaring that there has been such breach or non-observance shall be final & conclusive proof of such breach or non-observance as between the parties thereto & shall be binding on both the parties.

That the lesser reserves the right to resume the land leased out as mentioned in the land schedule Under Section. 3-B of O.G.L.S. Act; 1962 if the lessee does not use the land for the purpose for which it is granted within one year of this agreement.

Apparently some terms & conditions of the lease deed have not been property worded & not appended in an orderly manner, However, in order to understand the intention of the parties to the lease & the various terms & conditions to which they agreed, the document itself has to be read as a whole.

The question of construction of a deed came up for consideration before the Privy council in the case of AIR 1938 103 (Privy Council) . Lord Maugham speaking for a five Judge Bench laid down the principle as follows:

Their Lordships wish to add that in a case where the person executing the deed is neither blind nor illiterate, where no fraudulent misrepresentation is made to him, where he has ample opportunity of reading the deed & such knowledge of its purport that the plea of non est factum is not open to him, it is quite immaterial whether he reads the deed or not. He is bound by the deed because it operates as a'' conclusive bar against him not because he has read it or understands it, but because he has chosen to execute it.

A condition has been prescribed in Sub-clause-15 of Clause-II of the lease agreement that the lessee (Petitioner) has to establish the Dental College & Hospital on the demised land within one year from the date of the lease & the violation of the condition gives right to the lessor to determine the lease &-resume the land. But the manner of resumption which has been stipulated therein shows that it would be u/s 3-B of the O.G.L.S. Act, 1962. Therefore, the sub-clause consists of two parts, one giving the right to the lessor to determine the lease & resume the land for the failure of the lessee to establish the Dental Colleges within one year & the second, i.e., the manner & procedure that may be resorted to for resuming the land.

Section 3-B of the O.G.L.S. Act, 1962 provides as under:

3-B, Resumption of land & imposition of penalty-(1) Any officer authorised under Clause (a) of Section 3 may resume any land settled by him, if he has reasons to believe that the person with whom the land was settled has used it for any purpose other than that for which it was settled & may impose a penalty of an amount not exceeding one hundred rupees on such person:

Provided that no order under this sub-Section shall be passed without giving such person a reasonable opportunity of being heard in the matter.

Section 3-B of the O.G.L.S. Act provides only one ground for resumption of the land, Le., when the land is used for any purpose other than the purpose for which it was settled/leased out. Non-user of the land in question by the lessee for opening the Dental College & Hospital, which a period of one year of the lease may not satisfy the requirement of Section 3-B of the O.G.L.S. Act & may not furnish a ground for resumption taking recourse to Section 3-B of the O.G.L.S. Act. But non-application of Section 3-B of the O.G.L.S. Act does not deprive the lessor of its right to determine the lease & resume the land for violation of condition of non-user of the land within one year from the date of grant of lease under the general law. Lease of immovable property, as defined in Section 105 of the Transfer of Property Act, is a transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity, on consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee. The OGLS Act, 1962 has been enacted in order to bring uniformity in the principles regarding settlement or lease of Government land in the whole of the State of Orissa overriding the provisions of various Act, Rule, Order, Customs, Practices & Usages enforced in various parts of the State. The Act however cannot be said to have overriding effect on the provisions of the Transfer of Property Act, 1882, dealing with "lease" which is the general law. In that sense, the Rules & Principles under the OGLS Act must be held to be only supplemental to & not in derogation of the principles governing lease of immovable property contained in the Transfer of Property Act, Therefore, though Section 3-B of the OGLS Act contemplates termination of lease of Government land & resumption of the same for user of the property for any purpose other than that for which the lease was granted still the provisions of the Transfer of Property Act relating to determination of lease would apply. Section 111 of the Transfer of Property Act envisages different grounds in Clauses (a) to (g) thereof for determination of lease. Clause (g) of Section 111 provides for determination of lease by forfeiture, among others, for breach of any condition of the lease subject to the lessor giving notice in writing to the lessee of his intention of determine the lease.

As has been seen above, it is the stand the State-Opp. Party in their counter affidavit that the cancellation of the lease & resumption of the land has been done in accordance with the provision of Section 3-B of the O.G.L.S. Act, it is trial, as has been pronounced by this Court in several decisions including the ones reported in 2005 (II) OLR 77: Smt. Sandhya Rout & others v. State of Orissa & other & 2008 (II) OLR 806; Sri Narana Nayak v. State of Orissa & three others that non-user of the demised land cannot be treated to be user for a purpose other than for which the lease was granted & therefore, Section 3-B cannot be resorted to for cancelling the lease & resuming the land for non-user. Therefore, the order of cancellation of the lease of the Petitioner & resumption of the land under the provisions of Section 3-B of the O.G.L.S. Act is illegal & unsustainable.

In the aforesaid view of the matter, we quash the cancellation & resumption Order Dated 08.12.2007 under Annexure-9. If the possession of the property has been taken over by the State, as contended in their counter affidavit, it shall be restored the Petitioner within a period of two months. This however, does not debar the State from taking recourse to any other ground & procedure legally admissible for determination of the lease.

The writ application is accordingly disposed of. No costs.

B.P. Das, J.

I agree.