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REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

PETITIONS FOR SPECIAL LEAVE TO APPEAL (C) NOS.1878-1879 OF 2009

Suresh Narayan Kadam & Ors.       .…Petitioners

versus

Central Bank of India & Ors.           …Respondents  

J U D G M E N T

Madan B. Lokur, J.

1. The  proceedings  in  these  petitions  as  indeed  the  

proceedings  in  the  Bombay  High  Court  (out  of  which  the  

present  petitions  have  arisen)  indicate  a  clear  need  for  

encouraging  an  amicable  settlement  process,  preferably  

through mediation, in which the services of a mediator well-

versed in the art, science and technique of mediation may be  

taken advantage of.  The alternative, of course, is protracted  

litigation  which  may  not  be  the  best  alternative  for  the  

contesting  parties  or  for  a  society  that  requires  expeditious  

justice delivery.

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2. In his Foreword written on 12th April, 2011 to the first  

edition of “Mediation Practice & Law – The path to successful  

dispute  resolution”  written  by  Mr.  Sriram  Panchu,  Senior  

Advocate  and  Mediator,  Mr.  Fali  S.  Nariman,  a  Senior  

Advocate of this Court and a respected jurist, writes:  

“[T]he same subject matter of disputation between two  parties  can  be  dealt  with  in  two  different  ways,  not  necessarily  exclusive:  first, by attempting to  resolve a  dispute in such a way that the parties involved win as  much as possible and lose as little as possible through  the  intervention  of  a  third  party  steeped  in  the  techniques of  mediation; and  second, (failing this)  the  dispute  would  be  left  to  be  resolved  by  each  party  presenting  its  case  before  a  disinterested  third  party  with an expectation of a binding decision on the merits  of the case: a win-all lose-all, final determination”.   

The  second  alternative  may  not  be  the  best  alternative,  as  

already mentioned by us.   

3. The decision rendered by the High Court which is under  

challenge before us states that efforts were made to have the  

disputes between the contesting parties settled but it is clear  

that no institutional mechanism was invited to assist in the  

settlement process.  The proceedings before us also indicate  

that  several  efforts  were  made  to  encourage  the  contesting  

parties to arrive at a settlement, and at one point of time the  

parties did reach an interim arrangement but that could not  

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fructify into a final settlement only because of the absence of  

an  intervention  through  an  institutional  mechanism.  

Appreciating this, this Court has consistently encouraged the  

settlement of disputes through an institutionalized alternative  

dispute  resolution  mechanism and  there  are  at  least  three  

significant  decisions rendered by this  Court on the subject.  

They  are:  (i)  Salem Advocate  Bar  Assn.  (II)  v.  Union  of   

India1 (ii)  Afcons  Infrastructure  Ltd.  v.  Cherian  Varkey  

Construction  Co.  (P)  Ltd.2 (iii)  K.  Srinivas  Rao  v.  D.A.  

Deepa.3   

4. That apart this Court has, on several occasions, referred  

disputes for amicable settlement through the Mediation Centre  

functioning  in  the  Supreme  Court  premises  itself  and  

Mediation  Centres  across  the  country  in  a  large  variety  of  

disputes including (primarily) matrimonial disputes.  In spite  

of the encouragement given by this Court, for one reason or  

another, institutionalized mediation has yet to be recognized  

as an acceptable method of dispute resolution provoking Mr.  

Fali  S.  Nariman  to  comment  in  the  same  Foreword  in  the  

context of the Afcon’s decision that “Mediation must stand on  

its own; its success judged on its own record, un-assisted by  

1 (2005) 6 SCC 344 2 (2010) 8 SCC 24 3 (2013) 5 SCC 226

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Judges.”   

5. With this prologue, it is necessary to state the facts of  

the  dispute  before  us.  The  Maharashtra  Housing  and  Area  

Development  Authority  (MHADA)  had  constructed  some  

buildings for the lower and middle income groups in a complex  

known as Samata Nagar,  Kandivli,  Mumbai.   Each building  

had  twenty  flats.  The  Central  Bank of  India  (for  short  ‘the  

Bank’) took possession of the land and ten such buildings on  

16th August, 1982 with the intention of housing the families of  

a total of 200 employees.  Pursuant thereto, the Bank issued  

Circulars on 15th September, 1982 and 25th May, 1983 relating  

to the policy of allotment of the flats to its Class III and Class  

IV employees.

6. The Circular dated 15th September, 1982 provided that  

the flats would be allotted to employees under the jurisdiction  

of  the  Central  Office,  Bombay Main Office  and the Bombay  

Metropolitan  Regional  Office.  It  also  provided  that  the  

allotment  would  be  as  per  the  absolute  discretion  of  the  

management and that the facility of allotment was not given as  

a  condition  of  service  nor  did  any  right  vest  in  any  staff  

member.

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7. The Circular  dated 25th May,  1983 made some minor  

modifications in the eligibility for allotment but the sum and  

substance, as far as the present proceedings are concerned,  

remained more or less the same.

8. Based on the above broad principles,  the allotment of  

flats was made to its employees by the Bank.  We are told that  

presently, about 50 families are living in these flats, the rest  

being vacant.   

9. As earlier agreed upon by MHADA and the Bank, on 29th  

July,  1994  MHADA  leased  out  the  land  underneath  the  

buildings to the Bank for a period of 90 years.  Some of the  

salient  conditions  mentioned  in  the  Lease  Deed  read  as  

follows:-

“(h) Not to assign, sublet, underlet or otherwise transfer  in any other manner whatsoever including parting with  the possession of the whole or any part of the said land  or its interest thereunder or benefit of this lease to any  person or persons or change the user of the said land or  any  part  thereof  without  the  previous  written  permission of the Authority.

(i) To use the said land and the tenements in the said  buildings  constructed  thereon  for  the  purpose  of  residence of its employees as service quarter only and  for no other purpose.

(l) Not to make any excavation upon any part of the said  land without the previous consent of the Authority in  writing  first  obtained,  except  for  the  purpose  of  repairing renovation or rebuilding the existing structure  standing on the said land or utilization of permissible  

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F.S.I.  if  any  as  per  Development  control  rules/regulations on the plot leased to the lessee which  is  a  part  of  a  layout  of  village  Poisar  at  Borivali  Bombay."

10. Apparently  with  a  view  to  redevelop  the  plot  by  

demolishing the buildings purchased by the Bank, it appears  

that  the  Bank stopped  allotting  the  flats  from sometime in  

1997 onwards and on or about 15th June, 2007 it floated a  

proposal  for  redevelopment  of  the  plot  by  demolishing  the  

buildings.   The proposal  for  redevelopment  necessitated the  

eviction  of  the  employees  from the  flats  occupied  by  them.  

Therefore, sometime in July 2007 eviction notices were issued  

to the employees-allottees under the provisions of the Public  

Premises (Eviction of Unauthorised Occupants) Act, 1971 (for  

short “the Act”).

11. Some of the employees contested the proceedings and  

eventually  an  order  was  passed  by  the  Estate  Officer  

appointed  under  the  Act  in  2008  rejecting  all  their  

submissions  and  they  were  directed  to  vacate  the  public  

premises within 15 days of the date of publication of the order  

failing which they were liable to be evicted, if need be, by the  

use of such force as may be necessary.  The employees were  

also ordered to pay damages with effect from 15th June, 2007  

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till  the  date  of  handing  over  of  peaceful  possession  of  the  

public premises to the Bank failing which the amount would  

be recovered as arrears of land revenue.

12. Feeling  aggrieved,  the  employees  preferred  appeals  

under Section 9 of the Act which came to be dismissed by the  

City  Civil  Court  in  Bombay  in  June  2008.   The  Appellate  

Authority dismissed all the appeals with costs but stayed the  

order  of  eviction  for  a  period  of  seven  days  to  enable  the  

employees to approach the Bombay High Court.

13. The employees then approached the High Court by  

filing Writ Petition Nos.4417 of 2008 and 5589 of 2008 which  

were  heard  by  a  learned  Single  Judge  and  dismissed  by  a  

judgment  and  order  dated  19th December,  2008  (impugned  

before us).

14. The employees made the following four submissions  

before the High Court:

(i) MHADA had leased the land to the Bank for  

building residential quarters for Class IV employees;

(ii) the  premises  were  part  of  the  conditions  of  

services of the Class IV employees which could not  

be taken away by issuing a quit notice;

(iii) The  purpose  for  which  the  Bank  required  

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vacant buildings was for demolishing them in order  

to build new buildings for housing their managerial  

staff; and

(iv) The  notice  for  eviction  did  not  spell  out  the  

reasons for evicting the petitioners.

15. Each of these contentions was rejected by the High  

Court  but  before  us,  learned  counsel  for  the  petitioners  

effectively  pressed  only  the  1st and  3rd contentions,  being  

interlinked.

16. At this stage, we must point out that the High Court  

has observed that several adjournments were granted to the  

parties to negotiate a settlement.  However, the parties failed  

to arrive at any settlement and it is for this reason that the  

High Court was compelled to deliver judgment.   Before this  

Court also several efforts were made to arrive at some kind of  

an  amicable  settlement  including  providing  alternative  

accommodation to the employees or making monthly payment  

to  them in  lieu  of  the  allotted  premises.   However,  for  one  

reason or another despite best efforts made by learned counsel  

for the parties, no settlement could be arrived at.

17. At one stage, the following interim arrangement was  

broadly accepted by both the sides as noted in the order dated  

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29th November, 2010 but even that interim arrangement did  

not fructify into a settlement between the parties and it is for  

this reason that we too have been compelled to decide on the  

correctness or otherwise of the judgment and order passed by  

the High Court.

“(i) 49  employees  (sub  staff)  are  occupying  units  spread over several buildings.  Though most of the units  are vacant, as some of the units are occupied, the Bank  is not in a position to demolish the buildings and take  up  development  work  which  it  proposes.  In  the  circumstances, out of the 49 employees, those who are  allottees of quarters, will be shifted by the Bank to one  or  two  buildings  so  that  the  Bank  will  be  able  to  demolish  the  other  buildings  and  take  up  the  development.

(ii) It  is  made  clear  that  if  any  family  members  of  deceased allottees (who have been given compassionate  appointment) are continuing in such units, they will not  be  entitled  to  alternative  accommodation.  Such  occupants will have to vacate.

(iii) The  Bank  will,  in  the  meanwhile,  continue  its  efforts to identify alternative premises for those who are  being shifted to the two buildings.”

18. There is no doubt that none of the employees have  

any  right  to  retain  the  allotted  premises,  more  particularly  

since the allotment was not a part of their condition of service.  

This is quite clear from the Circulars dated 15th September,  

1982  and  25th May,  1983.   That  apart,  no  right  based  

submission was made before us.  That being the position, it is  

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really difficult to appreciate the basis on which the employees  

are  claiming  an  entitlement  to  continue  in  the  allotted  

premises.

19. It was submitted before us that the land was leased  

out by the MHADA to the Bank for the purposes of housing  

middle  income  group  employees  or  lower  income  group  

employees.  As a result of the redevelopment plan, the Bank  

was  intending  to  demolish  the  buildings  and  to  construct  

luxury apartments for their managerial level officers, contrary  

to the lease agreement with MHADA.   Assuming this to be so,  

if  there  is  a  violation  of  the  provisions  of  the  lease  deed  

between the MHADA and the Bank, it  is  really  for  them to  

settle their differences, if any.  The employees do not come into  

the picture at all.   

20. The various clauses in the lease agreement that have  

been referred to do not in any manner involve the employees  

and for them to raise an issue about any alleged violation of  

the  provisions  of  the  lease  deed  is  totally  inconsequential.  

This is not a public interest litigation where the rule relating to  

standing  can  be  relaxed.   We  are  therefore  not  inclined  to  

accept  this  submission  of  the  employees  that  since  the  

MHADA  had  leased  out  the  land  to  the  Bank  for  housing  

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middle income group or lower income group employees,  the  

Bank  is  disentitled  from  demolishing  the  buildings  and  

constructing  luxury  apartments  for  their  managerial  level  

officers.

21. The second argument advanced by the employees is  

really a different facet of the first argument and since we do  

not find any basis at  all  for the grievance of  the employees  

against either the MHADA or against the Bank, we reject this  

submission as well.

22. Under these circumstances, we find no merit in these  

petitions and therefore decline to grant special leave to appeal  

and dismiss these petitions but with no order as to costs.

23. Since the employees have been residing in the flats  

for a considerable period of time, we grant them time to vacate  

the premises allotted to them on or before 31st March, 2016.  

We  expect  the  employees  to  peacefully  vacate  the  allotted  

premises  and if  there  is  some difficulty  in  this  regard,  the  

Bank  is  at  liberty  to  approach  the  High  Court  for  the  

implementation of its order of eviction.

24. We  may  also  note  that  the  Bank  has  demanded  

damages from the employees both who are still working with  

the Bank and those who have retired.  In our opinion, since  

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the employees were pursuing their remedies before the High  

Court  as  well  as  before  this  Court,  we  do  not  think  it  

appropriate to direct them to pay any damages to the Bank for  

the  use and occupation of  the  premises allotted nor  do we  

think it appropriate to permit the Bank to recover the damages  

awarded against the employees.

..……………………..J           (Madan B. Lokur)  

                               ………………………J

New Delhi;                  (R.K. Agrawal) February 5, 2016

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