Petitioners have challenged demand letters issued by the first respondent demanding payment of transfer fee for recording the first petitioner as a tenant in respect of an immovable property under the first respondent.

Learned Advocate appearing for the petitioner has submitted that, Khetawat Chemical and Fertilizer Limited was the tenant under the first respondent in respect of the immovable property concerned. Khetawat Chemical and Fertilizer Limited mortgaged the leasehold interest in favour of UCO Bank as security for the credit facilities enjoyed by it. UCO Bank initiated proceedings under Section 19 of the Recovery of Debts due to Banks and Bankruptcy Act, 1993 for recovery of the credit facilities against Khetawat Chemical and Fertilizer Limited. Such proceeding was decreed by the Debts Recovery Tribunal - I, UCO Bank put the decree into execution. In the recovery proceedings, advertisements were published in the newspapers for sale of the leasehold interest of Khetawat Chemical and Fertilizer Limited. The petitioners participated in such sale. Ultimately, the petitioner was put into possession of the immovable property concerned by the Receiver appointed in the Recovery Proceeding on May 3, 2005. Thereafter, the petitioner requested the first respondent to record transfer of the leasehold interest in favour of the petitioner on May 20, 2005. On June 23, 2005 the first respondent expressed its willingness to record such transfer subject to payments of arrears of rent and service charges due and payable by Khetawat Chemical and Fertilizer Limited. The petitioners approached the Debts Recovery Tribunal praying for adjustment of the outstanding claim from the sale proceeds. The petitioner did not succeed in such endeavour. Thereafter, the petitioners expressed their willingness to pay the arrears of rent for recording the transfer. The first respondent did not act thereon.

Learned Advocate appearing for the petitioners has submitted that, the secretary of the first respondent issued a writing dated August 16, 2011 purporting to be modified/amended procedure of allotment/assignment and other norms relating to allotment. He has submitted that, at best, such norms which came into effect from August16, 2011 can be prospective and that, such norms cannot govern the relationship between the petitioners and the first respondent. Right, title and interest of the first petitioner in respect of the immovable property was created prior to the norms dated August 16, 2011 coming into effect. He has drawn the attention of the Court to the pleadings filed by the first respondent in the proceedings before the Debts Recovery Tribunal. He has submitted that, the first respondent accepted that, the first petitioners stepped into the shoes of Khetawat Chemical and Fertilizer Limited in respect of the immovable property concerned. The first respondent justified its demand of arrears from the first petitioner on such ground.

Learned Advocate appearing for the petitioners have submitted that, the amended procedure cannot have retrospective operation. The first respondent cannot act arbitrarily in making the demands as contained in the demand notices. He has submitted that, the demands are arbitrary. He has relied upon 1991 Volume 1 Supreme Court Cases page 212 (Kumari Shrilekha Vidyarthi & Ors. v. State of Uttar Pradesh) and submitted that, the first respondent having acted arbitrarily, the Court should intervene and grant the reliefs as sought for by the petitioners.

Learned Advocate appearing for the first respondent has relied upon Section 40 of the West Bengal Industrial Development Corporation Act, 1974. He has submitted that, there is no challenge to the amended procedure dated August 16, 2011 in the writ petition. Therefore, the petitioners cannot be allowed to contend that, the amended procedure is not applicable. Referring to the facts of the present case, learned Advocate appearing for the first respondent has submitted that, allotment does not give an indivisible right in favour of the allottee. In support of such contention, he has relied upon 2018 Volume 2 Calcutta High Court Notes (Cal) page 343 (Allenby Garments Pvt. Ltd. v. West Bengal Industrial Development Corporation Ltd.). He has submitted that, the first respondent was not present in the proceedings when the sale was confirmed in favour of the petitioner. The orders of sale therefore do not bind the first respondent. The first respondent became aware of the sale only on May 20, 2005 when, the first petitioner made a request for transfer of the lease. He has referred to the letter dated June 23, 2005 of the first respondent where, the first respondent agreed to transfer the lease in favour of the first petitioner upon payment of the arrear dues of Khetawat Chemical and Fertilizer Limited along with interest. According to him, since the petitioners did not pay the amount as demanded by the first respondent, the petitioners are not entitled to any relief. He has drawn the attention of the Court to the fact that, the petitioners instead of paying the amount as demanded by the letter dated June 23, 2005, disputed such claim before the Debts Recovery Tribunal and lost in such proceedings. Thereafter the petitioners maintained stoic silence. He has contended that, had the petitioners paid the amount in 2005, the question of payment of fees as now demanded under the amended procedure would not have arisen.

Since, the amended procedure came into effect from November 16, 2018, the petitioners are liable to pay the transfer fees as demanded. According to him, the petitioners are not entitled to the reliefs as sought for.

Learned Advocate appearing for Kolkata Port Trust (KoPT) Authorities has submitted that, KoPT leased out certain land to the first respondent. The first respondent is liable to pay the occupation charges in respect of such land, in accordance with the land policy and the tariffs laid down by the authorities from time to time.

Whether, the first respondent can charge transfer fees from the first petitioner for recognising the first petitioner as a leaseholder in place and stead of Khetawat Chemical and Fertiliser Limited on the basis of the amended procedure dated August 16, 2011, is the issue that has fallen for consideration in the present writ petition.

KoPT is the owner of the land in question. It had given such land on lease to the first respondent. The first respondent had let out the same to Khetawat Chemical and Fertiliser Limited. Khetawat Chemical and Fertiliser Limited had enjoyed credit facilities from UCO Bank. UCO Bank had filed a proceeding before the Debts Recovery Tribunal, Kolkata for recovery of its dues against Khetawat Chemical and Fertiliser Limited. UCO Bank had obtained a decree in such proceedings. UCO Bank had initiated recovery proceedings. In the recovery proceedings, the movable and immovable properties of KhetawatChemical and Fertiliser Limited were put up for sale. The sale was on as is where is and whatever there is basis. The first petitioner had participated in such sale. The first petitioner was declared as the highest bidder and the sale of the movable and immovable properties of Khetawat Chemical and Fertiliser Limited was confirmed in favour of the first petitioner. The first petitioner was ultimately put in possession of the immovable property concerned by the Receiver appointed by the Debts Recovery Tribunal on May 3, 2005. The first petitioner had requested the first respondent to treat the first petitioner as the leaseholder of the immovable property concerned under the first respondent by a writing dated May 20, 2005. The first respondent had replied thereto. By the writing dated June 23, 2005, the first respondent had expressed its willingness to record such transfer, subject to the first petitioner paying the arrears of the rent and service charges due and payable by Khetawat Chemical and Fertiliser Limited. Faced with such a reply from the first respondent, the first petitioner approached the Debts Recovery Tribunal for adjustment of the outstanding claim of the first respondent from the sale proceeds. The Debts Recovery Tribunal did not accept such prayer of the first petitioner. The first petitioner therefore, has become obliged to pay the arrear occupation charges of Khetawat Chemical and Fertiliser Limited in respect of the property concerned. In fact, the first petitioner had expressed their willingness to pay such arrears to the first respondent.

The materials placed on record has established that, the first respondent was aware that, the Debts Recovery Tribunal had put up the movable and immovable assets of Khetawat Chemical and Fertiliser Limited for sale and that the first petitioner was the purchaser in respect thereof. It did not approach the Debts Recovery Tribunal to have such sale set aside. By its conduct, the first respondent had accepted that, the first petitioner had stepped into the shoes of Khetawat Chemical and Fertiliser Limited in respect of the immovable property concerned. It had demanded that, the first petitioner clears the arrears of the occupation charges of Khetawat Chemical and Fertiliser Limited in respect of the immovable property concerned for it to recognise the first respondent as its lessee. This was much prior to the amended procedure dated August 16, 2011 coming into force. The first respondent having acknowledged the first petitioner to have stepped into the shoes of Khetawat Chemical and FertilisersLimited, much prior to the amended procedure dated August 16, 2011 coming into effect, it ought to have recorded the first petitioner as the leaseholder of the remaining portion of the lease entered into between the first respondent and Khetawat Chemical and Fertiliser Limited. The amended procedure dated August 16, 2011 cannot be read to mean that, it has retrospective effect. The words used in the amended procedure dated August 16, 2011 are such that, it comes into effect immediately on August 16, 2011. Therefore, the first respondent has acted arbitrarily in refusing to acknowledge the first petitioner as the leaseholder for the remaining term of the lease between the first respondent and Khetawat Chemical and Fertiliser Limited.

Kumari Shrilekha Vidyarthi & Ors. (supra) has held that, the requirements of Article 14 of the Constitution of India must be satisfied even in matters pertaining to contracts with private parties. An action taken by the state which is not based on discernible and reasonable principle, is to be termed as arbitrary and such an action has to be struck down. It has held that, non- arbitrariness is necessary concomitant of rule of law and is in substance fair play in action. Allenby Garments Private Limited (supra) has held that, there is no indefensible right to have a lease/sublease executed in favour of the allottee. In the facts of that case, a scheme of demerger was pressed into service so as to contend that, the entity was a lessee under West Bengal Industrial Development Corporation Limited. Such a contention was negated by the court. The facts scenario in the present case is different.

In the facts of the present case, the first petitioner became a leaseholder under the first respondent on and from the date when, the first petitioner was declared as the highest bidder by the Debts Recovery Tribunal, and the sale confirmed in its favour. The sale being on as is where is and whatever there is basis, the first petitioner became obliged to pay the arrears of Khetawat Chemical and Fertiliser Limited in respect of the lease, to the first respondent. The first respondent having acknowledged the first petitioner to have stepped into the shoes of Khetawat Chemical and Fertiliser Limited much prior to the amended procedure dated August 16, 2011 coming into effect, the first respondent cannot take the shelter of the amended procedure dated August 16, 2011 to demand any transfer fee from the first respondent. The issue raised in the writ petition has to answered in the negative against the first respondent and in favour of the petitioners.

Consequently, in my view, interest of justice would be sub served in the facts of the present case, by requiring the first petitioner to pay the arrears of Khetawat Chemical and Fertiliser Limited to the first respondent along with interest calculated at the rate of 8% per annum on and from the respective dates of default of Khetawat Chemical and Fertiliser Limited to pay the leas

e rents to the first respondent till its payment. The first petitioner will continue to pay the lease rents of the first respondent on and from the date of sale, to the first respondent, in accordance with the lease agreement between the first respondent and Khetawat Chemical and Fertiliser Limited. The first respondent will acknowledge the first petitioner as the leaseholder of the immovable property concerned, for the unexpired period of the lease between the first respondent and Khetawat Chemical and Fertiliser Limited. The first respondent is at liberty to take appropriate steps against the first petitioner in the event of default by the first petitioner of any of the terms and conditions of the lease governing the immovable property concerned. The parties will no doubt adjust. It is clarified that, this Court has not gone into the respective rights of KoPT and the first respondent in respect of the immovable property concerned. Such parties are at liberty to have their mutual rights settled before the appropriate forum, in accordance with law. W. P. No. 962 of 2015 is disposed of accordingly. No order as to costs. Later :- Learned Advocate appearing for the Respondent No. 1 seeks stay of the judgment and order. Such prayer is opposed by the petitioner. Considering the facts and circumstances of the case, the prayer for stay is refused.