There Is No Vested Right Of Renewal Of Lease Of Shops In Defence Shopping Complexes-Supreme Court



Dismissing the plea of lessees holding shops seeking renewal of their leases, the Supreme Court held that there was no vested right of renewal. The shops were allotted on lease to ex-service men who became wounded in combat and also to dependents of deceased Defense personnel. When their leases were not regenerated after a period of five years, they approached the Delhi High Court, which rejected their requests.

Before the Supreme Court it was contended with them that the non-renewal was based on instructions in a letter dated 04.09.2008, which had stated that the lease should not be renewed after five years. It was argued that there was an endorsement ‘DGL’ on the meridian of the letter, which meant ‘Draft Government Letter’. Thus the argument was that a draft letter was brought forth by the Union of India to deny the appellant’s relief, and that it amounted to nothing but fraud.

The Supreme Court nevertheless held that the petitioners were even otherwise not entitled to relief. Reference was made to Standard Operating Procedure of 2001, which had clearly stated that their renewal was subject to discretion, vide clause 17 thereof. Later, the Standard Operating Procedure of 2007 had stated clearly in clause 18 that the lease will not be renewed after five years. The Court declared that the fact that the leases used to be automatically renewed as a matter of form until the formulation of SOP of 2007 will not ensure to the benefit of the appellants. And then even it letter dated 04.09.2008 was ignored; the appellant was not entitled to relief.

The Court also said that the plea of legitimate expectation by the appellant was unfounded. The Court likewise found that the policy of granting leases for a specified period was not arbitrary. The Court accepted the justification of the Union that this has been done to ensure that immediately on suffering a loss, ex-servicemen or their household members are rehabilitated for a certain period of time and afterwards they have been rehabilitated and earned for 5 years they can earn their own livelihood without any financial backing from the Army and other somebody, who had suffered during this period, can be passed on this benefit.

By: Manavi Joshi

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