LexCITY MONTESSORI SCHOOL versus STATE OF U.P. & ORS.
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[2024] 8 S.C.R. 23 : 2024 INSC 570 City Montessori School v. State of U.P. & Ors. (Civil Appeal No. 8355 of 2024) 02 August 2024 [Abhay S. Oka* and Augustine George Masih, JJ.] Issue for Consideration The issue pertains to rights of the parties to a lease of a Plot vested with the State Government and the manner in which the said rights can be transferred. Headnotes† State Largesse – Grant of – Method to be adopted: Held: Rights of the State as the owner and lessor of a Plot can be transferred only by adopting a fair and transparent process by which the State fetches the best possible price – Rights of the State as the lessor can only be sold by a public auction or by any other transparent method by which, apart from the lessee, others too, get a right to submit their offer – Selling the plot at a nominal price will not be a fair and transparent method and shall be arbitrary and violative of Article 14 of the Constitution of India. [Para 9] Lease – Transfer of Property Act, 1882 – Section 109 – Rights of Lessee – Sale of Plot by the Lessor – Consequence of: Held: In case of the sale of a leasehold plot by the lessor, the rights of the lawful lessees do not get affected, as their tenancy will be attorned to the purchaser in view of Section 109 of the Transfer of Property Act,1882. [Para 9] Case Law Cited Akhil Bhartiya Upbhokta Congress v. State of Madhya Pradesh and Others [2011] 5 SCR 77 : (2011) 5 SCC 29 – relied on. List of Acts Constitution of India, 1950; Transfer of Property Act, 1882. * Author 24 [2024] 8 S.C.R. Digital Supreme Court Reports List of Keywords State Largesse; Leasehold land; Auction; Free hold rights; Section 109 of Transfer of Property Act, 1882. Case Arising From CIVIL APPELLATE JURISDICTION: Civil Appeal No. 8355 of 2024 From the Judgment and Order dated 25.09.2014 of the High Court of Judicature at Allahabad, Lucknow Bench in CWP No. 2101 of 1996 With Civil Appeal No. 8356 of 2024 Appearances for Parties Ravindra Raizada, Sr. Adv./A.A.G., Jayant Bhushan, Vinay Navare, Sr. Advs., Ashim Vachher, Shantanu Kumar, Pritish Kumar, Vaibhav Dabas, R. P. Gupta, Shaurya Sahay, Aditiya Kumar, Abhishek Chaudhary, Honey Jain, Ashish Batra, Advs. for the appearing parties. Judgment / Order of the Supreme Court Judgment Abhay S. Oka, J. 1. Leave granted. FACTUAL ASPECTS 2. These appeals take an exception to the same judgment of a Division Bench of Allahabad High Court. The dispute is essentially between the City Montessori School (for short, ‘the school’) and one Shri M.M. Batra regarding plot no.90-A/A-754, measuring 2238.5 sq. ft. situated at Maha Nagar, Lucknow (for short, ‘the plot’). It is not in dispute that the plot vests in the State Government. By a lease dated 4th January 1961, the Hon’ble Governor of Uttar Pradesh, through Nazul Officer, Lucknow, granted the lease of the plot to one Gursharan Lal Srivastava which was described as a ‘garden lease.’ A separate lease was granted on the same day in respect of the building on the plot. By a registered sale deed dated 26th June 1962, Gursharan Lal Srivastava sold his leasehold interest in the plot to Shri M.M. Batra (the alleged lessee). Rajat Batra and Raman [2024] 8 S.C.R. 25 City Montessori School v. State of U.P. & Ors. Batra are the sons of the alleged lessee. It appears that the plot is a Nazul property. Several Government Orders (G.Os.) have been issued, either providing for the conversion of leasehold lands into freehold or auction thereof. 3. The alleged lessee filed a Civil Suit in the year 1994 in the Civil Court. The suit was filed to protect possession. Later on, by amendment, he sought the benefit of G.O. of 17th February 1996 and 1st December 1998, which permitted the conversion of Nazul properties given on lease into freehold properties. On 13th March 1995, an auction notice was published for the auction of various Nazul lands, including the plot. The school and the sons of the alleged lessee submitted their bids. The school was found to be the highest bidder and therefore, the bid offered by the school was accepted. As provided in the auction notice/tender notice, the tender document had to be purchased by 23rd March 1995 since 24th March 1995 was a holiday, and the auction was fixed for 25th March 1995. It was alleged that the school purchased the tender document on 25th March 1995. The acceptance of the school’s bid was cancelled. However, the authorities again called upon the
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