MALIK AMAR CHAND KAPOOR Vs. UNION OF INDIA

JUDGEMENT

(1.) This writ petition has been filed by the petitioners, Malik Amar Chand Kapur and Smt. Durga Devi Kapur, for themselves and for the benefit of respondent No. 3, Malik Shiam Sarup Kapur, praying for the issuance of a writ of mandamus or a direction requiring the Union of India (respondent No. 1) to refer to arbitration an alleged dispute relating to the petitioners' claim for recurring compensation alleged to be payable to them in respect of certain requisitioned property in accordance with the provision of section 8 of the Requisitioning and Acquisition of Immoveable Property Act No. XXX of 1952. The respondents in the writ petition are (1) Union of India ; (2) Shri R. R. Desai, Additional Legal Adviser (Arbitration), Ministry of Law, Government of India ; and (3) Malik Shian Sarup Kapur. In opposition to the writ petition, an affidavit of Shri C. Balasubramaniam, Director of Estates, has been filed on behalf of respondent No. 1.

(2.) The property in question is a residential house in Block No. 14 B, Plot No. 9, situate in Karol Bagh, Delhi. The said property was requisitioned by the Goverdment of India by its order No. 2062/Comp. (B), dated 23rd September, 1942, under sub-rule (1) of rule 75A of tbe Defence of India Rules. It continued to be under requisition under the Requisitioned Lard (Continuance of powers) Act, 1947, and it was subsequently deemed to have requisitioned under section 3 of the Requisitioning and Acquisition of Immoveable Property Act No. XXX of 1952. The Property, when requititioned' was owned by one Mathura Dass, son of Jyoti Ram There ifter, it changed several hands It appears that one Ratan Lal Gupta was the owner in 1955. and one Abdul Karim Khan become the owner in 1946 under a sale deed. dated 23th March, 1946. Under a sale deed (Annexure 'A'), dated 23rd March, 1959, and supplemental deed (AnnexureA-1) dated nil, the property is stated to have been purchased by the petitioners from Abdul Karim Khan, At the instance of the petitioners, the property was de requisitioned by an order (Annexure (B), dated 15th December. 1955 with effect from 19th December 1956 It appears that possession of the porperty was, however, delivered to the petitioners even on 17th December, 1955 Shri Deepak Chaudhry, learned counsel for respondent No. 1 produced the relevant file which contains the delivery receipt, and it shows/that possession was delivered on 17th December 1955

(3.) Sub-section (1) of section 8 of the Requisitioning and Acquisition of Immoveable roperty Act No XXX of 1952 provides inter alia, .that where any property is requisitioned or acquired under the Act. there shall he paid compensation, the amount of which shall be determined in the manner and in accordance with the principles set out in the subsection. Clause (a) of Sub-section (1) provides that where the amount of compensation can be fixed by agreement, it shall be paid in accordance with such agreement. Clause (b) provides that where no such agreement can be reached, the Central Government shall appoint as arbitrator a person who is, or has been. or is qualified for appointment as a Judge of a High Court. Sub -section (2) of section 8 provides that the amount of compensation payable for the the requisitioning of any property shall consist of:- (a) a recurring payment, in respect of the period of requisition. of a sum equal to the rent which should have been payable for the use and occupation of the property, if it had been taken on lease for that period; and (b) such sum or sums, if any, as may be found necessary to compensate the person interested for all or any of the following matters, namely:- (i) pecuniary loss due to requisitioning; (ii) expenses on account of vacating the requisitioned premises; (iii) expenses on account of re-occupying the premises upon release from requisition; and (iv) damages (other than normal wear and tear) caused to the property during the period of requisition, including the expenses that may have to be incurred for restoring the property to the condition in which it was at the time of requisition.' Thus, clause (a) of sub-section (2) of section 8 provides of recurring payment, while clause (b) thereof provides for payment of certain other sums. The Executive Engineer, ' G Divsion" Central Public Works Department. New Delhi, sent a letter, dated 28th November, 1956, to the first petitioner enclosing two bills described as "hand receipts ' in original, the first, dated 29th June, 1956 for a sum of Rs. 385.00 being restoration charges (for maintenace-restoration repairs) for the property in question, and the second (Annexure R 1) dated 21st November, 1956, for Rs. 640-8-O being compensation for the period between 23rd March, 1955, the date of purchase the petitioners and 16th December, 1955, the date previous to the date of delivery of possession, at the rate of Rs. 80.00 per month, after deducting Rs. 62-2-0 towards maintenance and electric charges for the said period. It was stated in the said letter that the said hand receipts were on a count of compensation rent for the period from 23rd March, 1955 to 16th December, 1955 and restoration charges in respect of the property in question and that the said receipts were sent for acknowledgement on stamped receipt and early return. The petitioners sent a reply. dated 27th December, 19 6, stating that the compensation of Rs. 385.00. for de-requisitioning their house proposed to be paid to them was too low to be accepted by them, that their claim in no case was less than Rs 4,000.00 for which they could send a detailed estimate, that they desired to settle the affair amicably, and that otherwise the case may be forwarded io an arbitrator under the provisions of the Requisitoning and Acquisition of Immoveable Property Act In reply to the said letter of the petitioners, the Executive Engineer wrote letter, dated 7th May.1957 requesting that the petitioners might furnish a copy of the estimate in support of their claim for Rs. 4,000.00. the petitioners submitted a detailed estimate for Rs.4,4l8/ as damages caused to their house, along with a covering letter, Annexure R-2, dated :-rd August, 1957. In addition to the said amount, they claim in the said conveing letter a further sum of Rs. 1000.00 Under Section 8, sub-section (2), clauses (b)(i) to (b)(iii) of the Requisitioning & Acquisition of Immoveable Property Act. ft appears that the petitioners again sent a letter, dated 9th October, 1957, and also had an interview with Shri C.C. Sinha, A E.0. regarding the claim for restoration-repairs to the property in question Refferring to the said letter and the interview, the Estate Officer, wrote a letter, dated 28th March, 1958, informing the petitioners that their request for the payment of restoration charges amounting to Rs. 5,000.00 could not be acceded to, that the Government of India had already sanctioned an amount of Rs.385.00 for repairs, and that the petitioners might contact the Executive Engineer for the payment of the said amount of Rs. 385.00. True copies of the bills, dated 29th June. 1956 and 21st June 1956 and the letters dated 28th November 1956, 27th December, 7th May 1957 and 28th March 1958 which were available in the file produced by Shri Deepak Chaudhry have been filed by him and they have been placed on record then, on 3rd April, 1958, the petitioners wrote a letter (Annexure K-3) to the Estate Officer staling that the sum of Rs, 385/ offered to them as compensation was not acceptable to them and requesting that, in the circvmstances the case may be sent to arbitration. Accordingly, the Government of India passed an order, (Annexure 'C'), dated 19th May 1959. stating that whereas no agreement could be reached with the owners of the property in question with respect to certainclaims for 'terminal compensation" made by the first petitioner, consequent on the de-requisiting of the property, the Central Govrnment in pursuance of clause (b) of sub-section (1) of section 8 of the Requisitioning or Acquisitioning of Immoveable Property Act No XXX of 1952 thereby appointed Shri G S Gaitonde Additional Legal Adviser (Arbitration) in the Office of the Director General, Supplies and Disposals, as arbitrator ' for settling the claims of the owners for terminal compensation in respect of the said property It appears that subsequently Shri G. S. Gaitonde resigned, and the Central Government appointed Shri R. R, Desai, respondent No. 2, in the place of Shri Gaitoade as arbitrator. Clause (d) of sub-section (1) of section 8 provided that at the commencement of the proceedings before the arbitrator, the Central Government and the person to be compensated shall state what in their respective opinion is a fair amount of compensation and clause (e) provides that the arbitrator shall, alter healing the dispute, make an award determing the amount of compensation which appears to him to be just and specifying the person or persons to whom such shall be paid and that in making the award he shall have regard to the circumstances of each case and the provisions of subsections (2) and (3) so far as they are applicable. Accordingly, the arbitrator issued a notice (Annexure 'D'), dated 25th May, 1959, to the petitioners and the Estate Officer staling (that he was appointed by the Central Government as sole arbitrator "for determining the terminal compensation" payable in respect of the property inquestion arising out of its de-requisition by the Government with effect from the 19th December, 1955, and calling upon the petitioners and the Estate Officer to appear before him. The petitioners accordingly submitted their claim (Annexure 'E') dated 28th June, 1959. they stayed in that claim that the property in ques was requisitioned in the beginning of the year 1943, that it was said that a flat rat e of compensation was continued to bepaid to the predecessors-in-interest at the petitioners who were the present owners, that the petitioners purchased the house on 23rd March, 1955 by means of a registered sale deed, a copy of which was attached thereto, and that since then they had become entitled to every kind of compensation including recurring payment by way of compensation for the use and occupation. They further stated that since 1943 there had been considerable rise in rents, that Khan Abdul Karim Khan who was the immediate predecessor in-interest of the petitioners was paid the same monthly compensation of Rs. 80.00 as was paid since the date of requisition, that Abdul Karim Khan purchased the property by a registered sale deed dated 13th March, 1946, that for the period from 13th March, 1946, to 12th March, 1952, the monthly rent for a premises like the property in question was not less than Rs 200.00 a month, and the said rate lasted till the year 1952, and the compensation for the said period "comes to Rs. 200.00 Rs. 80.00==Rs. 120.00 Rs. 20.00 (amount remitted) ==Rs. 100 x 12 months x 6 years=Rs. 7,200.00", that from the year 1952, there was again a rise in the rents of the premises like the one in question, and the rent was not less than Rs. 3000.00, and therefore, the compensation for the period from 13th March, 1952, to 22rd March, 1955 (the date of their purchase) "comes to as above Rs 300/ Rs.80.00==Rs. 220.00Rs. 20.00 Rs. 2 Ox 12 months x 3 years == Rs. 7,200.00", and that in that manner, the total amount to which the previous owner Khan Abdul Karim Khan was entitled came to Rs. 14,400.00 to which the present owners, the petitioners, were entitled as they had been authorised to realise that amount by means of assignment (Annexure A & A-1). The petitioners then stated in their claim that the Government offered rent to them at the rate of Rs 80/ per month which they had refused, that the amount of compensation for use and occupation to which the present owners (petitioners) were entitled in the years 1955, should be at notless than Rs. 400.00a month, and the amount due to them at that rate from 23rd March, 1955, the date of purchase by them, to 19th December 1955, the date of delivery of possessisn came to Rs. 3,573-5-3. They also stated that since 1947 the area in which the house in question was situate had become an important commercial locality, and consequently its rental value had become enhanced, that its potential rental value for the period of 9 months i. e. from 23rd March, 1955, to 19th Decemeber, 1955, come to Rs. 900.00 and that they were thus entitled to a total amount of Rs. l4,400.00 plus Rs. 3,573 5 3 plus Rs. 900.00== Rs. 18,874-5-3 as compensation under clause (a) of sub section (1) of section 8. They went on to state that the house in question was used in a negligent manner during the period it was under requisition and was considerably damaged, that they were entitled to an amount of Rs, 5.000.00 by way of structural pamages, that the said amount of damages did not include the damage which was not visible to an open eye, that on account of lack of repairs and neglect, the life of the premises was prematurely, shortened and they were entitled to a Bum of Rs, l,000.00 by way of damages for the same, and that they were thus edtitled to a sum of Rs.6,000.00 as damages under sub-clause (iv) of clause (b) of sub-section (2) of section 8.