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REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.2770 OF 2013  (ARISING OUT OF SLP (CIVIL) NO.355 OF 2010)

Bharat Petroleum Corporation Limited … Appellant

Versus

Rama Chandrashekhar Vaidya & Another …Respondents

WITH

SLP (CIVIL) NO.15 OF 2010

J U D G M E N T

Aftab Alam J.

SLP(C) No.355 of 2010

1. Leave granted.

2. The appellant-Bharat Petroleum Corporation Limited, is a Public Sector  

Oil  Company.  In  appeal  against  a  decree  of  eviction,  it  claims  the  right  to  

another  innings  under  section  5(2)  of  the  Burmah  Shell  (Acquisition  of  

Undertakings in India) Act, 1976 (hereinafter referred to as “the Act”).

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3. The facts which provide the context for judging the appellant’s claim are  

brief and simple.   

4. The predecessor of the appellant, namely, Burmah Shell Oil Storage and  

Distributing Company of India Limited came in occupation of a piece of land  

situated  at  Kurla,  Taluka-South  Salsette,  District  Bombay  suburban,  now  

included  in  Greater  Bombay,  admeasuring  an  area  of  19,188  square  feet,  

bearing Hissa No.1 (part) of Survey No.305 of Kurla (the suit premises) on the  

basis of a registered deed of lease dated September 22, 1955.  The lease was for  

a period of 25 years beginning from March 1, 1955 and further gave to the  

lessee [vide. Clause 3 (d)] the unilateral right of renewal for an additional period  

of  twenty  five  years  by  giving a  notice  in  writing  two months  prior  to  the  

expiration of its term.

5. On January 24, 1976, the Burmah Shell (Acquisition of Undertakings in  

India) Act, 1976 came into force and by virtue of section 3 of the Act, the right,   

title and interest of Burmah Shell in relation to its undertakings in India stood  

transferred  to  and  vested  in  the  Central  Government.  Later  on,  following  a  

notification issued by the Central Government under section 7(1) of the Act, the  

right, title and interest and the liabilities of Burmah Shell in relation to any of its  

undertaking in India that had vested in the Central Government were transferred  

to and vested in the appellant Company.  

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6. A few months  before  the  term of  the  lease  was  to  come to  end,  the  

appellant, on October 17, 1979 gave a notice to the lessor invoking the renewal  

clause in the lease deed1 and asking for the renewal of the lease, at the same rent  

and upon the same terms and conditions as were contained in the lease, for a  

further period of 25 years with effect from March 1, 1980.  In the notice it was  

also stated that a fresh engrossment of lease was being drawn up for execution  

and registration.  

7.  At this stage, it needs to be noted that though the appellant gave to the  

lessor the renewal notice and also continued to occupy the suit premises for the  

next twenty five years, no fresh lease deed was actually executed between the  

parties and registered in renewal of the previous lease. It also needs to be noted  

here that the lessor sent a letter to the appellant on April 24, 1980 stating that  

the monthly rent of the suit premises stood increased to Rs.500/- from March 1,  

19802,  but  the  appellant  was  remitting  rent  to  the  lessor  at  the  old  rate  of  

Rs.400/- only. The appellant was requested by the letter to pay the differential  

amount for the past two months and to pay the future rent at the increased rate  

of Rs.500/- per month.  

8. As the second twenty five year term was nearing expiry, another notice  

for renewal of the lease was given on behalf of the appellant to the lessor on  1 Though the notice mentions clause 4(b) of the lease deed, it actually refers to clause 3(d) which is the renewal  clause.  Clause 4(b) relates to the determination of the lease on account of the failure of the lessor to obtain a   licence or a renewal in respect  of the pump outfit  or outfits standing upon the suit premises at  the time of  execution of the deed or to be erected and maintained thereupon in future.

2 As per the stipulation in the 1955 lease.

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October 7, 2004. This notice was, once again, with reference to the lease deed  

dated September 22, 1955.  It was stated in the notice that the lease after its  

renewal would be expiring on February 28, 2005 and the appellant was desirous  

of continuing in occupation of the premises for another period of thirty years.  

This notice concluded by observing and claiming as under:

“Since  we  are  in  occupation  of  the  site  and  carrying on the business of retailing of petroleum  products from the above premises for the last 50  years,  and  in  public  interest  are  desirous  of  continuing the business  of  storing and selling of  petroleum products from the above premises for a  further period of 30 years w.e.f. 1st March, 2005 on  the same terms and conditions.”

9. This time the lessor responded by a notice of termination of tenancy dated  

March 3, 2005. In this notice, it was stated on behalf of the lessor that the 1955  

lease expired on September 21, 1980 but the appellant neither sent any notice  

for renewal of the lease period nor the lease in respect of the suit premises, an  

open plot of land, was renewed. Hence, the appellant continued as a month to  

month tenant in respect of the open plot of land on payment of rent at the rate of  

Rs.500/- per month.  The notice further stated that the lessor was not interested  

in continuing the monthly tenancy of the appellant and the tenancy was being  

terminated by that notice.

10.  A reply to the termination notice was given, on behalf of the appellant,  

by letter dated March 10, 2005 in which the provisions of sections 5 and 7 of  

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the Act were invoked for the first time and a claim was raised for the renewal of  

the lease for a further period of 30 years on the same terms and conditions as  

contained in the earlier lease.  

11. At  that  stage  the  respondent  –  lessor  filed  a  suit  for  eviction  of  the  

appellant which was registered as T.E. & R Suit No.72/86 of 2005 in the court  

of Small Causes at Mumbai.  The appellant contested the suit by filing a written  

statement and the court of Small Causes by judgment and order dated January  

18, 2007 dismissed the suit.  The respondent filed an appeal (appeal No.163 of  

2007)  before  the  Appellate  Bench  of  the  Small  Causes  Court  at  Mumbai  

challenging  the  order  dismissing  the  suit.   The  appeal  was  allowed  by  the  

Appellate Bench by its judgment and order dated March 5, 2009.  Against the  

order of the Appellate Bench of the Small Causes Court, the appellant filed a  

revision (revision application no.535 of 2009) before the Bombay High Court.  

The  revision  application  was  dismissed  by  the  High  Court  by  order  dated  

October 14, 2009 and the appellant then brought this matter to this Court in  

appeal by special leave.  

12. Mr. C.A. Sundaram, learned senior counsel appearing for the appellant,  

strongly argued that the right of renewal under the lease and the right of renewal  

in  terms of  section  5(2) of  the Act  are  two distinct  and separate  rights,  the  

former being contractual and the latter statutory.  He further contended that the  

two rights being different in nature and arising from different sources could,  

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therefore, be exercised separately and successively, independently of each other.  

Mr. Sundaram contended that though in the year 1980, the Act had come into  

force nevertheless, the appellant chose first to exercise its right of renewal in  

terms of the provision in the lease.  However, the exercise of the contractual  

right of renewal would not abrogate the appellant’s statutory right as provided  

under section 5(2) of the Act and at the expiry of the lease renewed in terms of  

the contract, it would be still open to the appellant to get a further renewal of the  

lease in exercise of the statutory right under section 5(2) of the Act.  

13. In support of the submission, Mr. Sundaram relied upon the decisions of  

this Court in  Bharat Petroleum Corporation Ltd.  v.  P. Kesavan and another3  

and Hindustan Petroleum Corporation Ltd. And another v. Dolly Das4.

14. The decision in P. Kesavan does not touch upon the issues raised by Mr.  

Sundaram and does not seem to have any application in the facts of this case. In  

P. Kesavan, this Court held that renewal of the lease in terms of section 5(2) of  

the  Act  takes  place  by  operation  of  law  and  the  renewal  is,  therefore,  not  

dependent upon the execution or registration of a fresh deed of lease.  By virtue  

of section 5(2), the term of the earlier lease would be deemed to be renewed on  

the same terms and conditions on which the earlier lease or tenancy was held  

regardless of the execution or registration of a fresh lease deed.  This is not the  

question arising in the present case.

3 (2004) 9 SCC 772

4 (1999) 4 SCC 450

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15.   The case of Dolly Das is indeed quite similar to the case in hand on facts  

and seems to have given rise to similar issues as arising in this case.  But in  

Dolly Das, the Court did not adjudicate on the issues and gave certain directions  

having regard to the special facts and circumstances of the case.  Dolly Das, too,  

therefore, is of no help in deciding this case.

16. Therefore, the points urged by Mr. Sundaram need to be examined on  

their own merits.   

17. On  a  careful  consideration  of  the  matter,  we  find  that  though  Mr.  

Sundaram has crafted his submissions very skilfully, the points raised by him do  

not really arise in the facts and circumstances of the case as noted above.  

18. The original 1955 lease (which, as a matter of fact, is the only lease deed  

that came into existence between the parties) was for a period of 25 years and  

was due to expire on February 28, 1980. On October 17, 1979, the appellant  

gave the notice of renewal invoking the renewal clause in the lease deed. In the  

renewal notice, there is no reference at all to any provision, much less section  

5(2) of the Act.  After February 28, 1980, the appellant admittedly continued in  

occupation of the suit premises but it is undeniable that no fresh deed of lease  

was executed and registered renewing the terms of the previous lease.  

19. Now, let us examine what would be the position in the absence of a fresh  

deed being executed and registered between the parties.  There are  only two  

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possibilities; one, that the renewal notice was in exercise of the renewal clause  

in the lease deed. If that be so, the execution and registration of a fresh deed of  

lease was essential for the renewal of lease to take place.  (See:  State of U.P.   

and others v. Lalji Tandon (dead) through Lrs.5 paragraphs 13 and 14:  Anthony  

v.  K.C. Ittoop & Sons and others6,  paragraphs 8 to 11 and  Hardesh Ores (P)   

Ltd. v. Hede and Company,7).   

20. In case the renewal was claimed in terms of the stipulation in the lease  

deed (described as the “contractual right” by Mr. Sundaram), in the absence of a  

fresh deed of renewal, the appellant’s status became that of a month to month  

tenant and after twenty five years, in that relationship it would be ludicrous for  

the appellant to turn around and claim renewal of lease under section 5(2) of the  

Act..  

21. Mr. Sundaram made an attempt to argue that it was not a case of renewal  

of lease but a case of extension of the term of the lease and in that case no fresh  

deed was required to be executed and registered between the parties. In support  

of the submission, he relied upon two decisions of Calcutta High Court, one by  

a division bench in Syed Ali Kaiser v. Mstt. Ayesha Begum8 and the other by a  

learned single Judge of the same court in Ranjit Kumar Dutta v. Tapan Kumar  

5 (2004) 1 SCC 1 6 (2000) 6 SCC 394 7 (2007) 5 SCC 614 8 AIR 1977 Calcutta 226

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Shaw9.   We need not  go into the question whether  an extension of  lease  is  

permissible in the absence of any fresh deed for the simple reason that this is  

unquestionably a case of renewal of lease and not of extension of lease.  

22. Thus, in case, renewal was claimed under a clause of the previous lease,  

the appellant has no case and the lessor cannot be faulted for terminating the  

tenancy by a notice under the Transfer of Property Act, 1882.  

23. The other possibility is that though in the renewal notice dated October  

17, 1979 there is no reference to section 5(2) of the Act, the renewal must be  

deemed to have taken place under that provision because the Act had come into  

force on January 24, 1976 and by virtue of section 5(2) of the Act, the renewal  

clause of the existing lease stood superseded.  If the “renewal”, beginning from  

March 1, 1980 is to be deemed under section 5(2) of the Act that would be a  

legally valid and correct  renewal even in the absence of  a fresh deed being  

executed between the parties, as was held in P. Kesavan. If that be the position,  

then the appellant has already exercised and exhausted its right under section  

5(2) of the Act and there can be no question of a second renewal in terms of the  

statutory provision.  

24. Thus,  viewed  from any  angle,  the  appellant  cannot  claim any  further  

renewal of lease beyond February 28, 2005.  

9 AIR 1997 Calcutta 278

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25. In light of the discussions made above, we find no merit in the appeal. It  

is, accordingly, dismissed with costs quantified at Rs.50,000/-.

26. However, having regard to the business of the appellant, it is given two  

months’ time from the date of the judgment to vacate the suit premises.  

SLP(C) No.15/2010.

27. SLP(C) No.15 of 2010 is dismissed for the reasons stated in the judgment  

in the connected matter, being Civil Appeal (arising from SLP (C) No. 355 of  

2010).

............................................J. (Aftab Alam)

............................................J. (Ranjana Prakash Desai)

New Delhi, April 2, 2013.  

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IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

I.A. Nos.                 OF 2013

IN

CIVIL APPEAL No.   2270      OF 2013 (ARISING OUT OF S.L.P. (C) NO.355 OF 2010)

AND SPECIAL LEAVE PETITION (CIVIL) NO.15 of 2010

Bharat Petroleum Corporation Limited … Appellant

Versus

Rama Chandrashekhar Vaidya & Another …Respondents

O R D E R

These interlocutory applications have been filed by the respondent  

(the  landlord)  stating  that  in  gross  violation  of  the  undertakings  given  

before the High Court, the petitioner, in connivance with its dealer, has  

inducted a rank outsider to the suit premises.

The appeal of the appellant/petitioner (the tenant) is dismissed by the  

judgment and order pronounced today.

It  will,  therefore,  be  open  to  the  respondent/landlord  to  get  the  

decree of eviction passed in his favour duly executed and/or to initiate a  

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proceeding for contempt before the Bombay High Court and/or to seek  

appropriate reliefs in any other way that may be available to him in law.     

The IAs are disposed of.

 .........................................J. (Aftab Alam)

........................................J. (Ranjana Prakash Desai)

New Delhi, April 2, 2013.  

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