Supreme Court holds West Bengal Govt company to be in unlawful possession of property for 22 years; retd High Court judge to decide compensation

The Supreme Court on Monday took a very grim view of a West Bengal government body retaining unlawful possession of a property in Kolkata for the last 22 years without "paying a single pice towards compensation" ( Punalur Paper Mills Limited v. West Bengal Mineral Development and Trading Corporation ).

. A Bench of Justices Rohinton Fali Nariman and BR Gavai termed it "very disturbing" after it noted that the West Bengal Mineral Development and Trading Corporation (WBMDTCL) was enjoying unlawful possession of the property though its effective entitlement to the same ended way back in 1998

. "A very disturbing feature of these appeals is the fact that WBMDTCL, which is “State” within the meaning of Article 12 of the Constitution of India, has continued in unlawful possession of the premises since August 15, 1998 without paying a single pice towards compensation till date," the Court said. . It was hearing appeals against a Division Bench order of the Calcutta High Court which had ordered peaceful possession of the property to be handed over to the lawful owners, Punalur Paper Mills within three months.

. Facts

. The property in question was the entire second floor admeasuring 7,500 square feet at Linsday street, Kolkata which was requisitioned under the West Bengal Premises Requisition And Control (Temporary Provisions) Act, 1947 in August 1973 to WBMTDCL.

In March 1987, Section 10B was inserted in the Act. As a result of the operation of Section 10B of the West Bengal Requisition Act, any property requisitioned under the Act had to be released by the State Government on or before the expiry of a period of 25 years from the date of requisition. For the Premises, this 25-year period ended in August, 1998, obligating the State to release the Premises.

. However, instead of vacating the premises, after the expiry of 25 years, the premises were sought to be acquired for the "public purpose" of providing the permanent office accommodation to WBMDTCL in September 1999. This was sought to be done by issuing a notification under Section 4 of the Land Acquisition Act, 1894

The notification was challenged in Calcutta High Court. A single-judge bench on June 22, 2000, ordered vacant possession of the premises to be handed over in three months.

. The petition was kept alive to determine compensation. However on the same day, the same order was vacated as the State issued another notification concerning the same property, this time invoking the urgency provision under section 17(4).

. In 2017, a single-judge Calcutta High Court struck them down all those notifications and ordered that vacant possession be handed over to the owner in three months.

On appeal, the Division Bench of the High Court directed that the property should be vacated and possession should be handed over to Punalur Paper Mills within three months.

It also directed that the Chief Judge, City Civil Court at Calcutta should assess the compensation / rent / occupational charges for the period of August 16, 1998 till the date on which possession of the property is made over to Punalur Paper Mills.

. Judgment

. The top court held that West Bengal was on notice from March 31, 1987, when section 10B was inserted in the West Bengal Requisition Act, that the premises would have to be released on or before August, 1998.

This gave the State the time of 11.5 years to act and acquire the premises and such acquisition could easily have been done by way of a notification under section 4 of the Land Acquisition Act before the lapse of the 25-year period, the Supreme Court noted.

. But it failed to do so. Subsequently, long after the requisition period elapsed on August 15, 1998, the State issued a notification under Section 4 of the Land Acquisition Act, without invoking any urgency provision.

Later, it invoked urgency provision after the June 2000 order of single-judge.

. "To then say that the urgency provision could be invoked on account of the Single Judge’s order dated 22.06.2000, is to attempt to infer from the said order, much more than it actually said. Therefore, the Division Bench rightly held that at best this order could possibly refer to the acquisition proceedings that had already been initiated by the notification of 12.08.1999 under section 4 of the Land Acquisition Act. In any case, this order could not and did not wash away the lethargy of the State in initiating acquisition proceedings, which ought to have been done before the 25-year period elapsed," the Court held

. The Court the proceeded to address the claim of compensation made by the appellant, Punalur Paper Mills.

. It noted that the disturbing feature of the appeals was that a government body which fell within the definition of State was retaining unlawful possession of property for the last 22 years without paying any money.

. It, therefore, appointed retired Calcutta High Court judge, Justice Soumitra Pal to act as an arbitrator to decide compensation payable to Punalur Paper Mills.

. "A written authority to appoint such arbitrator is to be furnished to us immediately, i.e., within a week from 23.02.2021. If not so furnished, WBMDTCL will be liable to pay a sum of Rs. 100 per square foot, per month for the entire period of illegal occupation of the Premises within four months from the date of this judgment," the top court directed.

. The apex court also ordered WBMTDCL to hand over the possession of the premises to the appellant within 4 months.

. Same directions were passed against West Bengal Sugar Industries Development Corporation Ltd. which was found to be in illegal occupation of a portion of the fifth floor of premises

. [Read Judgment]

Supreme Court holds West Bengal Govt company to be in unlawful possession of property for 22 years; retd High Court judge to decide compensation

Debayan Roy

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