HOTEL DEEPTI Vs. ROURKELA STEEL PLANT

JUDGEMENT

(1.) This writ application has been filed for a direction to the opposite parties to grant permission to the petitioner for mortgaging the properties mentioned in the petition to the flanks or other financial institutions for availing various loan facilities.

(2.) The case of the petitioner is that the petitioner's hotel was initially started by some entrepreneurs and the hotel was run in the name and style of 'Hotel Konarak'. In the year 1988, M/s. Patel and partners purchased the said hotel from the owners thereon and started running the same in the name and style of 'Hotel Deepti'. A lease deed was executed on 7th August, 1998 under a tripartite lease agreement between the State of Orissa, Steel Authority of India Ltd. and the petitioner and. under the said lease deed, the schedule lands which are sought to be mortgaged were given on lease to the petitioner. Clause 16 of the lease deed provides that without prior permission of the opposite party No. 1, the petitioner cannot assign, transfer, mortgage, sublet or otherwise deal with the properties. The petitioner being in great necessity of working capital for construction of the required building as per approved plan approached various banks and other financial institutions to obtain loan and also term loans for construction of infrastructures of the said hotel. The financial institutions insist upon mortgage of the property as collateral security for advancement of the loan. The petitioner therefore applied to the opposite parties in the prescribed form for grant of permission to mortgage the properties for securing Term Loan and cash credit facility. The matter was kept pending for long time in spite of the reminders sent on behalf of the petitioner and no action having been taken by the opposite parties on the application for grant of permission, the writ application was filed in the year 2001. At the time of hearing of the writ application, the learned Counsel for the petitioner informed this Court that during pendency of the writ application also no decision has been taken.

(3.) A counter affidavit has been filed by the opposite parties 1 and 2. In the said counter affidavit, execution of the lease deed in favour of the petitioner in respect of the schedule land is not in dispute. However, it is stated in the counter, affidavit that grant of permission or refusal of the same is' the discretion of the said opposite parties and the same cannot be questioned in a Court of law. The learned Counsel appearing for the opposite parties 1 and 2 in course of hearing also questioned the maintainability of the writ application on the ground that the dispute relates to a contractual obligation arising out of lease agreement and, therefore cannot be agitated in a writ application.