Supreme Court

Chandro Devi and Ors. Vs. Union of India (UOI) and Ors.

MANU/SC/1124/2017

08.09.2017

Civil

Fraud has to be pleaded and proved; mere allegations of fraud are not sufficient

Present appeal is against the judgment passed in Review Petition, whereby the Division Bench of the Delhi High Court dismissed the review petition and refused to recall the judgment passed in Letters Patent Appeal No. 513 of 2010, which was dismissed, upholding the judgment of the learned Single Judge. A number of writ petitions were filed by the Petitioners who were either ex-servicemen, who had suffered injuries during war or active service or had retired after rendering full service. Some of the Writ Petitioners like Chandro Devi (Appellant, herein) were family members of the deceased army personnel, who had died in war etc.

The original writ Petitioners were rehabilitated by allocating them shops in those colonies where defence personnel reside. These colonies were being managed by the Station Commander. In Delhi, such colonies are located at S.P. Marg, Delhi Cantt., Arjun Vihar, Dhaula Kuan, Shankar Vihar etc. It is not disputed that, as per the lease deed(s) entered between the writ Petitioners and the Station Commander, the leases were granted to the Petitioners only for a period of 11 months, but there was a Clause in the lease deed that it could be renewed. On 13th April, 2007 a policy was introduced, which provided that the lease should not be extended beyond 5 years under any circumstances. However, the persons whose leases were cancelled after 5 years could apply for grant of fresh lease after 3 years. The leases of the leaseholders were cancelled since they had held the shops on lease for more than 5 years. The Petitioners challenged non-renewal of their leases and claimed that they were entitled to renewal thereof. The learned Single Judge dismissed the writ petitions. The letter patent appeals filed by the lessees including the Appellant were dismissed by the Division Bench. Some of the original writ Petitioners filed special leave petitions before this Court, which were dismissed.

If there is fraud, which leads to passing of a judgment, then fraud vitiates all actions taken consequent to such fraud and this would mean that, the judgment would be set aside. However, before setting aside the judgment, Court must come to the conclusion that, the action was fraudulent. Every wrong action is not a fraudulent action. Assuming that the letter dated 4th September, 2008 was only a draft letter, it does not mean that this letter was fraudulently introduced by the Union of India. In the letter placed before the Court the word 'DGL' find mention. It may be true that, the counsel for the Union of India did not inform the Court that the words 'DGL' stood for 'Draft Government Letter', but, it is equally true that even the counsel for the Appellant did not make any efforts to find out what the words 'DGL' stood for. Even the Court did not look into this aspect. Fraud has to be pleaded and proved. Mere allegations of fraud made for the first time in this Court are not sufficient.

Clause 17 of the Standard Operating Procedure (for short 'SOP') dated 10th August, 2001, which even as per the Appellant was applicable provides that, Renewal of licence deed will be done on the recommendation of residential associations, which will be obtained three months in advance from the date of expiry of licence deed by DDA & QMG. If the recommendations are in favour of allottee, then the Station Commander may renew the licence deed for the subsequent year. However, the licence deed may be terminated at any time by the Station Commander at his discretion.

The main ground taken by the Appellant is that, in view of letter dated 25th February, 2005 the Station Commander had no authority to issue the second SOP for management and control of shopping complexes on 13th April, 2007. Vide letter dated 25th February, 2005, the Ministry of Defence proposed to take over the management of all shopping complexes and to frame guidelines in this regard, but as per Para 3 of this letter, amendments to Clause 2(v) would be applicable from 1st April 2005 or from the date when the guidelines/rules, as envisaged in Clause 2(vi) are framed, whichever is later. The Ministry of Defence issued Defence Shopping Complexes (Maintenance and Administration) Rules in the year 2006. It is the case of the Appellant herself that, these Rules are not applicable to shops constructed on defence lands by public funds. Therefore, as per the Appellant, these Rules are not applicable to the present case. Vide letter dated 4th September, 2008 the guidelines were circulated. The Appellant contends that, this was only a draft government letter and, therefore, these guidelines are also not applicable to them. If that be so, it clearly means that, no guidelines have been framed with regard to the shops on defence lands created out of government funds. If no fresh guidelines have been framed then amended Clause 2(v) would not come into play. Then SOP of 2001 would be applicable and that can be amended by the Station Commander himself. The SOP of 2007, provides that no shops will be leased out for a period of more than 5 years.

The learned Single Judge has made reference to Clause 17 of the SOP of 2001 and Clause 18 of the SOP of 2007 and held that, in terms of the above Clause 18, the right to get the licences renewed immediately on the expiry of five years has been withdrawn. The allottees are expected to apply again after a minimum break of three years. In terms of the revised policy, the Respondents issued letters to the Petitioners declining renewal of licences. The copies of letters requiring the Petitioners to vacate the shops under their occupation have been enclosed with the petition.

This judgment of the learned Single Judge was upheld by the Division Bench and also by this Court though in a petition filed by some other Petitioner. On going through the SOPs of 2001 and 2007, Supreme Court did not find that, the Appellant had any vested right to continue in possession even after 5 years. Even, as per the SOP of 2001, the Station Commander was to renew lease from year to year and there was no inherent right to continue as a lessee in perpetuity. These leases have been determined in a non-discriminatory and non-arbitrary manner. Supreme Court dismissed the appeal.

Tags : Lease Renewal Grant

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