# New Okhla Industrial Development Authority, District Gautam Budh Nagar v. M/s. Pathik

- **Citation:** (2023) 9 ILRA 159
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2023-09-06
- **Case number:** First Appeal Defective No. 218 of 2022
- **Bench:** Mahesh Chandra Tripathi, Prasant Kumar
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/new-okhla-industrial-development-authority-district-gautam-budh-nagar-v-m-s-50768
- **Pages:** 34

## Headnote

Ms. Shreya Gupta, Sri Shiv Om Vikram
Singh Chauhan, Sri Vishnu Gupta (Sr.
Advocate),
Sri
Shashi
Nandan
(Sr.
Advocate)

A. Civil Law-The Commercial Courts Act,
2015-Sections 16 & 2(1)(c)-substantial
question of law- whether the dispute
involved in the present case can be
considered as commercial dispute- in the
instant case though the parties have
executed the lease deed of the land in
question
which
was
subsequently
cancelled by the notice- the plaintiff
company
approached
the
appellant
authority for grant of lease in respect of
an immovable property for the purpose of
trade and commerce-The lease deed of the
plot in question was executed and
pursuant to the lease deed the plaintiff
company deposited 30% of the amountthe possession of the land was handed
over to the plaintiff company- In terms of
Clause 13 (A) of the lease deed the
plaintiff company had to complete the
construction within five years from the
actual date of possession, which could be
extended further two years-Neither it
deposited the required money in terms of
the agreement nor moved any application
for enlargement of time for constructionConsequently,
the
lease
deed
was
cancelled and the property was re-allotted
in favour of the defendant company- The
instant suit has been filed for adjudication
of a dispute arising out of the lease deed
relating to immovable property- There is
nothing on record to show that at the time
when the lease deed was executed the
property was being exclusively used in
trade and commerce so as to bring dispute
within the ambit of sub-clause (vii) of
Section 2(1)(c) of the Commercial Court
Act, 2015-Merely because, the property is
likely to be used in relation to trade and
commerce, the same cannot be the ground
to
attract
the
jurisdiction
of
the
Commercial Court- A dispute relating to
immovable property per se may not be a
commercial dispute but the same becomes
a commercial dispute, if it falls under subclause (vii) of Section 2 (1) (c) of the ActThus, Learned Commercial Court totally
misinterpreted
the
definition
of
commercial
dispute
and
failed
to
appreciate that there is a difference
between the "Commercial Dispute and
Commercial Relation"- Hence, the finding
of learned Commercial Court that there is
a commercial dispute between the parties
suffers from infirmity-The Commercial
Court had no jurisdiction to decide the
present dispute between the parties.(Para
1 to 73)

B. Section 2 (1) (c) of the Commercial
Court Act, 2015 clears that the expression
"used" must mean "actually used" or
"being used". If the intention of the
legislature was to expand the scope, in
that case the phraseology "likely to be
used" or "to be used" would have been
used.
A
matter
will
fall
under
the
jurisdiction of the Commercial Court or
the Commercial Division of the High Court
on the following factors namely (i) it shall
be a commercial dispute within the
meaning
of
Section
2(1)(c)
of
the
Commercial Court Act, 2015; and (ii) such
commercial disputes are of a specified
value
as
per
Section
2
(i)
of
the
Commercial Court Act, 2015. a dispute
relating to immovable property per se may
not be a commercial dispute but the same
becomes a commercial dispute, if it falls
under sub-clause (vii) of Section 2 (1) (c)
of the Act viz. "the agreements relating to
immovable property used exclusively in
trade or commerce". The words "used
exclusively in trade or commerce" are to
be interpreted purposefully. The word
"used" denotes "actually used" and it
cannot be either "ready for use" or "likely
to be used" or "to be used". It should be
"actually used".(Para 69, 70)

The appeals are allowed. (E-6)

List of Cases cited:
9 All. New Okhla Industrial Development Authority, District Gautam Budh Nagar Vs. M/s. Pathik
 Software Education Pvt. Ltd., Pandav Nagar, Delhi & Anr.
161

## Text

_Characters 0–39,991 of 118,885. This is a partial read: ask again with offset=39991 for what follows._

9 All. New Okhla Industrial Development Authority, District Gautam Budh Nagar Vs. M/s. Pathik
 Software Education Pvt. Ltd., Pandav Nagar, Delhi & Anr.
159
The second issue for consideration is
whether the representation filed by the
petitioner under section 15(1) of the
Gangsters Act has been decided or not.

21. Perusal of the order dated
14.10.2022 clearly reveals that it is a
consequential order passed in compliance of
the order dated 13.10.2022 passed by the
Vice Chancellor. This fact finds a mention in
the order dated 14.10.2022. Neither the order
dated 13.10.2022 has been filed on record nor
is the same under challenge in this writ
petition. The order dated 14.10.20222 being a
consequential order, the same cannot be
interfered with till such time, the order dated
13.10.2022 passed by the Vice Chancellor of
the University is challenged and set aside.

22. Under the circumstances, the order
dated 14.10.2022, a consequential order
cannot be faulted. A writ of certiorari for
quashing of this order, therefore cannot be
issued.

23. Insofar as the second issue, as to
whether the representation filed by the
petitioner under section 15(1) of the Act has
been decided or not. It would be relevant to
note that this representation is admittedly
dated 27.10.2020. Yet another representation
was made by the petitioner on 03.08.2022
after the decision in Writ Petition No. 8937 of
2022.

24. From bare perusal of Annexure 5 to
the writ petition, which is the order passed by
the District Magistrate on 11.08.2022. It is
clear that both these representations stand
decided
by
this
order.
Since
the
representation dated 27.10.2020 filed by the
petitioner has not been annexed with the writ
petition, it cannot be gainfully argued that the
same has not been decided by the order dated
11.08.2022.

25. All others submissions made at the Bar
on behalf of the petitioner are inconsequential
because the main order that required challenge,
namely, the order of the Vice Chancellor dated
13.10.2022 is neither on record nor under
challenge.

26. Under the circumstances, addressing all
other arguments raised by the petitioner would be
a purely academic exercise.

27. In view of the foregoing, and since the
two issues which arise for consideration in the writ
petition has been decided against the petitioner, the
writ petition fails and is dismissed.

28. Even connected Writ Petition No.15652
of 2022 is dismissed as the order passed by the
Vice Chancellor on 13.10.2022 and the
consequential order passed by the Registrar on
14.10.2022 are not under challenge in this writ
petition.

29. Accordingly, both writ petitions are
dismissed.
----------
(2023) 9 ILRA 159
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 06.09.2023

BEFORE

THE HON'BLE MAHESH CHANDRA
TRIPATHI, J.
THE HON'BLE PRASANT KUMAR, J.

First Appeal Defective No. 218 of 2022
Connected with
First Appeal No. 467 of 2022

New
Okhla
Industrial
Development
Authority, District Gautam Budh Nagar
 ...Appellant
Versus
M/s. Pathik Software Education Pvt. Ltd.,
Pandav Nagar, Delhi & Anr. ...Respondents
160 INDIAN LAW REPORTS ALLAHABAD SERIES
Counsel for the Appellant:
Sri Kaushalendra Nath Singh

Counsel for the Respondents:
Ms. Shreya Gupta, Sri Shiv Om Vikram
Singh Chauhan, Sri Vishnu Gupta (Sr.
Advocate),
Sri
Shashi
Nandan
(Sr.
Advocate)

A. Civil Law-The Commercial Courts Act,
2015-Sections 16 & 2(1)(c)-substantial
question of law- whether the dispute
involved in the present case can be
considered as commercial dispute- in the
instant case though the parties have
executed the lease deed of the land in
question
which
was
subsequently
cancelled by the notice- the plaintiff
company
approached
the
appellant
authority for grant of lease in respect of
an immovable property for the purpose of
trade and commerce-The lease deed of the
plot in question was executed and
pursuant to the lease deed the plaintiff
company deposited 30% of the amountthe possession of the land was handed
over to the plaintiff company- In terms of
Clause 13 (A) of the lease deed the
plaintiff company had to complete the
construction within five years from the
actual date of possession, which could be
extended further two years-Neither it
deposited the required money in terms of
the agreement nor moved any application
for enlargement of time for constructionConsequently,
the
lease
deed
was
cancelled and the property was re-allotted
in favour of the defendant company- The
instant suit has been filed for adjudication
of a dispute arising out of the lease deed
relating to immovable property- There is
nothing on record to show that at the time
when the lease deed was executed the
property was being exclusively used in
trade and commerce so as to bring dispute
within the ambit of sub-clause (vii) of
Section 2(1)(c) of the Commercial Court
Act, 2015-Merely because, the property is
likely to be used in relation to trade and
commerce, the same cannot be the ground
to
attract
the
jurisdiction
of
the
Commercial Court- A dispute relating to
immovable property per se may not be a
commercial dispute but the same becomes
a commercial dispute, if it falls under subclause (vii) of Section 2 (1) (c) of the ActThus, Learned Commercial Court totally
misinterpreted
the
definition
of
commercial
dispute
and
failed
to
appreciate that there is a difference
between the "Commercial Dispute and
Commercial Relation"- Hence, the finding
of learned Commercial Court that there is
a commercial dispute between the parties
suffers from infirmity-The Commercial
Court had no jurisdiction to decide the
present dispute between the parties.(Para
1 to 73)

B. Section 2 (1) (c) of the Commercial
Court Act, 2015 clears that the expression
"used" must mean "actually used" or
"being used". If the intention of the
legislature was to expand the scope, in
that case the phraseology "likely to be
used" or "to be used" would have been
used.
A
matter
will
fall
under
the
jurisdiction of the Commercial Court or
the Commercial Division of the High Court
on the following factors namely (i) it shall
be a commercial dispute within the
meaning
of
Section
2(1)(c)
of
the
Commercial Court Act, 2015; and (ii) such
commercial disputes are of a specified
value
as
per
Section
2
(i)
of
the
Commercial Court Act, 2015. a dispute
relating to immovable property per se may
not be a commercial dispute but the same
becomes a commercial dispute, if it falls
under sub-clause (vii) of Section 2 (1) (c)
of the Act viz. "the agreements relating to
immovable property used exclusively in
trade or commerce". The words "used
exclusively in trade or commerce" are to
be interpreted purposefully. The word
"used" denotes "actually used" and it
cannot be either "ready for use" or "likely
to be used" or "to be used". It should be
"actually used".(Para 69, 70)

The appeals are allowed. (E-6)

List of Cases cited:
9 All. New Okhla Industrial Development Authority, District Gautam Budh Nagar Vs. M/s. Pathik
 Software Education Pvt. Ltd., Pandav Nagar, Delhi & Anr.
161
1. Kailash Devi Khanna Vs DD Global Capital Ltd.

2. R. Kumar Vs T.A.S. Jawahar Ayya

3. M/S Glasswood Realty Pvt Ltd Vs Chadravilas
Kailashkumar

4. Ujwala Raje Gaekwar Vs Hemaben Achyut
Shah (2017) SCC Guj 583

5. Shri Saurav Jain & anr. Vs M/s A. B. P. Design
& anr.

6. Federation of A.P. Chambers of Com. & Inds.
& ors.. Vs St. of A.P. & ors.

7. Chandrika Misir Vs Bhaiya Lal

8. LC in Nokes Vs Doncaster Amalgamated
Collieries Ltd.

9. Harbhajan Singh Vs Press Council of India

10. Corp of the City of Victoria Vs Bishop of
Vancouver Island

11. Attorney General Vs Milne

12. Crawford Vs Spooner
13. Vasu Healthcare Pvt. Ltd Vs Gujarat Akruti
TCG Biotech Ltd.

14. Messrs. Trojan & Co. Ltd. Vs Rm. N.N.
Nagappa Chettiar

(Delivered by Hon'ble Mahesh Chandra
Tripathi, J.
&
Hon'ble Prasant Kumar, J.)

1. We have heard Sri Kaushalendra Nath
Singh and Sri A.B. Singhal, learned counsel
for New Okhla Industrial Development
Authority; Sri Vishnu Gupta, learned Senior
Advocate, assisted by Mr. S.O.V.S. Chauhan,
learned counsel for M/s Pathik Software
Education Private Limited and Sri Shashi
Nandan, learned Senior Advocate, assisted by
Ms. Shreya Gupta, learned counsel for M/s
Innova A.M. Tech L.L.P., Gautambuddh
Nagar.

2. Both appeals arise out of common
judgment and decree dated 28.3.2022 passed
by the Presiding Officer, Commercial Court,
Gautam Budh Nagar in Suit (Comm) No.167
of 2021 (M/s Pathik Software Education Pvt.
Ltd.
vs.
CEO
New
Okhla
Industrial
Development Authority and two others).

3. Learned counsel for the parties agreed
that both appeals may be disposed of at this
stage without calling for original record as the
relevant records alongwith the pleadings are
already appended alongwith the appeals and
they have no objection, in case these appeals
are decided without summoning the record.

4. With the consent of learned counsel
for the parties, both these appeals are being
decided by a common judgment.

5. The brief facts, which led to the
present situation, are that M/s Pathik Software
Education Private Limited1, Pandav Nagar,
which is plaintiff in the suit, now referred as
plaintiff company, is a Private Limited
Company having its registered office at E-52,
Pandav Nagar, Delhi-110092 and it is engaged
in the business of education etc. The plaintiff
company was allotted a land bearing no.30
area 2100 sq. mtrs. situated at Sector 142
Noida, District Gautam Budh Nagar, U.P. on
17.02.2006
by
New
Okhla
Industrial
Development Authority2, which is defendant
no.1 in the suit, referred as defendant authority
and the lease deed of the plot in question was
executed on 19.01.2007.

6. The relevant clauses of the lease
deed are as follows:-

"LEASE DEED
162 INDIAN LAW REPORTS ALLAHABAD SERIES

This lease deed made on this 1th day
of January in the year Two Thousand Seven
between
New
Okhla
Industrial
Development Authority a body corporate
constituted under Section 3 of the U.P.
Industrial Area Development Act 1976
(U.P. Act No.6 of 1976) hereinafter called
the Lessor which expression shall unless
the context does not so admit include its
successors of the first part and M/s Pathik
Software Education Pvt. Ltd., a company
within the meaning of Company Act, 1956
having its registered office E-52, Pandav
Nagar, Delhi-92, through its Director Smt.
Brijesh Singh W/o Sh. Joginder Singh R/o
E-292A, Sector-22, Noida, Distt. G.B.
Nagar, U.P., hereinafter called Lessee
which expression shall unless the context
does not so admit includes its successors,
administrators,
representatives
and
permitted assignees of the other part.

..

NOW THE LEASE DEED
WITNESSES AS FOLLOWS:

1. That in consideration of total
premium
of
Rs.79,25,400.00
(Rupees
Seventy Nine Lac Twenty Five thousand
Four hundred only) towards the land
premium calculated @ Rs.3774/- per sq.
mtrs out of which 30% i.e. 23,77,620.00
(Rupees Twenty Three lac Seventy Seven
thousand Six hundred Twenty only) has
been paid by the lessee to the lessor the
receipt
where
of
the
lessor
hereby
acknowledges and balance Rs.55,47,780.00
(Rupees Fifty Five lac Forty Seven
thousand Seven hundred Eighty only) shall
be paid to the lessor in Sixteen half yearly
equal installment alongwith interest @ 11%
per annum compounded half yearly as per
the following:

1st instalment
Rs.3,46,737.00 + Interest on or before
16.08.2006
2nd instalment
Rs.3,46,737.00 + Interest on or before
16.02.2007
3rd instalment
Rs.3,46,737.00 + Interest on or before
16.08.2007
4th instalment
Rs.3,46,737.00 + Interest on or before
16.02.2008
5th instalment
Rs.3,46,737.00 + Interest on or before
16.08.2008
6th instalment
Rs.3,46,737.00 + Interest on or before
16.02.2009
7th instalment
Rs.3,46,737.00 + Interest on or before
16.08.2009
8th instalment
Rs.3,46,737.00 + Interest on or before
16.02.2010
9th instalment
Rs.3,46,737.00 + Interest on or before
16.08.2010
10th instalment
Rs.3,46,737.00 + Interest on or before
16.02.2011
11th instalment
Rs.3,46,737.00 + Interest on or before
16.08.2011
12th instalment
Rs.3,46,737.00 + Interest on or before
16.02.2012
13th instalment
Rs.3,46,737.00 + Interest on or before
16.08.2012
14th instalment
Rs.3,46,737.00 + Interest on or before
16.02.2013
15th instalment
Rs.3,46,737.00 + Interest on or before
16.08.2013
16th instalment
Rs.3,46,737.00 + Interest on or before
16.02.2014

.....

.....

9. That the lessee will complete
construction
and
obtain
occupancy
certificate
from
the
building
cell
department within the validity period of the
approved building plans and put the same
in operation as per plans approved by the
lessor and as per provision of clause No.13
of this lease deed for allotment and
cancellation
of
plot.
In
case
such
allottee/lessee who are interested to avail
exemption of stamp duty has to obtain
approval of Development Plan within 18
months from the date of registration of
9 All. New Okhla Industrial Development Authority, District Gautam Budh Nagar Vs. M/s. Pathik
 Software Education Pvt. Ltd., Pandav Nagar, Delhi & Anr.
163
Lease Deed from the competent authority
of the lessor and complete the 40% of the
total permissible covered area on the
allotted plot within 3 years from the date of
handing over of possession and also have to
complete whole construction within five
years from the date of handing over of
possession.

In the event of Lessee's not
complying
with
above
clause
Bank
Guarantee submitted by the Lessee will be
invoked and encashed.

Provided that the lessee has the
option of availing exemption from stamp
duty shall execute an Agreement and
submit Bank Guarantee as per provision of
Government order No.KNO5-305/11-2005500 (136) 2003 Dt. 19.01.2005, 3014/76-605/500 (40)/2000 dated 19.12.2005, and
2168/78-2-2005/46
IT/2005
dated
30.12.2005.

The Lessee is not willing to avail
the benefit of exemption of stamp duty vide
undertaking dt. 19.1.2007.

......

......

13. (A) The allottee/Lessee will
complete
construction
and
obtain
occupancy certificate from the competent
Authority of the Lessor within the validly
period of the approved building plan. The
Lessee/Allottee shall ensure the functioning
on the allotted plot as per schedule give
below.

PLOT UPTO 1000 SQ. MTRS

Within two years from the actual
date of possession.

PLOTS
ABOVE
1000
SQ.
MTRS. BUT UPTO 2000 SQ. MTR.

Within three years from the actual
date of possession.

PLOTS
ABOVE
2000
SQ.
MTRS. BUT UPTO 4000 SQ. MTRS.

PLOT
ABOVE
4000
SQ.
MTRS.

Within five years from the actual
date of possession.

B. In case of non adherent to the
aforementioned schedule for functioning,
the cancellation of allotment and / or
determination
of
Lease
Deed
with
forfeiture of money would be effected as
per rules and the possession of the plot
would be resumed by the lessor with
structure
thereof,
if
any
and
the
allottee/lessee will have no right to claim
compensation
thereof.
However,
in
exceptional circumstances, an extension
may be allowed by the lessor on payment
of such charges and subject to terms and
conditions, as deemed fit by the lessor.

C. In the event of an extension,
extension charges @ 4% of the premium
would be chargeable for grant of extension
for each year on pro data monthly basis. The
rate of extension charges as mentioned above
may be reviewed by the lessor. In the event of
extension not being granted, cancellation may
be exercised following with revocation of
lease deed with forfeiture amount as per then
prevailing policy of the lessor, in such an
event the lessee will be at liberty to remove
construction if any, in such eventuality. The
rate of extension charges as mentioned above
may be revised by the Lessor/Chief
Executive Officer without notice.

It is further classified that the
provision of clause no.9 of this lease deed
shall not of applicable in respect of
allotment and cancellation of plot as this
clause No.9 is applicable in cases of those
lesseess who one interested in availing
exemption from stamp duty only.

...

....

26. And it is hereby agreed and
declare by and between the parties to these
present as follows:
164 INDIAN LAW REPORTS ALLAHABAD SERIES

i)
Notwithstanding
anything
contained herein above, if in the opinion of
the lessor (whose decision shall be final
and binding) any breach or violation of
terms
and
conditions
of
the
registration/allotment/lease deed or nondeposit
of
dues
&
any
of
the
covenants/conditions
herein
before
contained and is to be observed and
performed and in particular and without
prejudice to the generality of the sub clause
if lessee transfer (s) assign (s) relinquish (s)
or mortgage (s) the whole of the demised
premises before construction of a building
on its part as herein before provided within
the period mentioned above or if the lessee
or the persons in whom the right is hereby
created are adjudged insolvent.

ii) It shall be lawful for the
LESSOR, without prejudice to any other
action, to re-enter the demised plot or any
part thereof and determine this lease and
forfeit the amount as per rules and
thereupon.

Iii) If at any time of re-entering
the demised plot shall not have been
occupied by nor any building constructed
by LESSEE, the LESSOR may re-allot the
demised plot and refund the payment if any
after
making
adjustment
as
required
without
deducting
arrears
of
lease/interest/extension/charges and other
charges as per rules.

iv) If at any time- entering the
demised plot shall not have been occupied
by any building constructed by the
LESSEE, thereon, the LESSEE shall within
a period of three months from the date of
re-entry remove from the demised plot all
erection or building fixtures and things
which at any time and during the said terms
shall be affixed or get upon the demised
plot and leave the same in a good condition
as it was on the date of demise, and default
of the same shall become the property of
the LESSOR without payment of any
compensation to the LESSEE for the land
and building structure and things therein
within the LESSEE may be paid such
amount as may work out in accordance
with the principle given in the sub-clause
(ii) above, provided that the LESSOR may
at its option agree to purchase from the
LESSEE his interest in the demised plot.

v) Any loss suffered by the
LESSOR on a fresh grant of the demised
plot breaches of conditions as a aforesaid
on part of LESSEE for or any person
claiming through or under him shall be
recoverable by the LESSOR.

vi) All notice order or other
documents required under the terms of the
lease or under U.P. Act, No.6 of 1976 or
any rule or regulation made thereunder
shall be deemed to be duly served as
provided under Section 43, of U.P. Urban
Planning and Development Act, 1973 as re
- enacted and notified by U.P. Residents
Act, 1974 (Act No.30 of 1974) re - enacted
with modifidication.

vii) The provisions of U.P.
Industrial Area Development Act, 1976 and
as any rules and regulations framed under
the act or any direction issued shall be
binding on the LESSEE and his/her/their
successive.

viii) All power exercised by the
LESSOR under this lease may be exercised
by Chairman / CEO. The LESSOR may
also authorise any of its officers to exercise
all or any of the powers by it under this
rule.

ix) Any relaxation or concession
granted by the LESSOR to LESSEE shall
not in any way prejudice the legal rights of
the LESSOR.

x) Any disputes arising with
regards to this deed shall be subjected to
the jurisdiction of Civil Courts at Gautam
9 All. New Okhla Industrial Development Authority, District Gautam Budh Nagar Vs. M/s. Pathik
 Software Education Pvt. Ltd., Pandav Nagar, Delhi & Anr.
165
Budh Nagar or High Court of Judicature at
Allahabad.

xi) The land is in peaceful
possession of the LESSOR and is being
handed over to the LESSEE free from any
encroachment and obstruction.

xii) The Chairman / CEO of the
LESSOR reserves the right to make such
amendments,
additions
alterations
or
modification, in terms and conditions of the
lease from time to time as he may consider
just and reasonable.

xiii) Subject to the sub- clause
(ix) in case of any clarification or
interpretation regarding these terms and
conditions of the lease deed, the decision of
Chairman. CEO of the LESSOR will be
final and binding on the LESSEE.

xiv) The lessee shall complete the
project
within
stipulated
period
as
mentioned in clause 9 and 13 of lease deed.
In case the lessee fails to comply with the
terms and condition of allotment letter,
lease deed brochure or not make the project
functional within stipulated period as
mentioned in clause 9 and 13 of lease deed.
That action shall be taken as per rules and
regulations of the Authority regarding
cancellation.

xv) The terms and conditions of
brochure, allotment letter dt. 17.02.2006,
lease, building bye - laws as amended from
time to time shall be binding on LESSEE."

7. Admittedly, the possession of the
land was handed over to the plaintiff
company on 01.02.2007 and in terms of the
lease deed the plaintiff company has to
complete the construction within five years
from the actual date of possession i.e.
01.02.2007 and further to pay the defendant
authority in terms of the instalments fixed
in the lease deed. Once the plaintiff
company failed to comply with the
aforesaid conditions then the defendant
authority issued notices to the plaintiff
company
on
19.12.2013,
26.02.2014,
17.06.2020 and 14.07.2020 but the said
notices were not responded by the plaintiff
company. Finally, the defendant authority
vide order dated 07.01.2021 had cancelled
the lease deed executed in favour of the
plaintiff company.

8. Thereafter, the plaintiff-company
had filed a Writ C No.13225 of 2021 (M/s
Pathik Software Education Pvt. Ltd. vs.
State of UP and 2 others) before this Court
assailing the validity of the order dated
07.01.2021. However, the writ petition was
dismissed on 27.7.2021 as withdrawn with
liberty to file a fresh with better particulars.
Meanwhile, the defendant authority had
proceeded to make allotment of the plot in
question in favour of M/s Innova AM Tech
LLP, which is defendant no.2 in the suit,
referred as defendant company3.

9. The plaintiff company instituted a
suit under the Commercial Courts Act
registered as C.S. (Comm) No.167 of 2021
(M/s Pathik Software Education Pvt. Ltd.
vs.
CEO
New
Okhla
Industrial
Development Authority and others) in the
Commercial Court, Gautam Budh Nagar
seeking following reliefs:-

"19. यह कि वादी किम्ि किकित अिुतोष िी
याचिा िरता ह ैः-

अ. यह कि द्वारा घोणषात्मि किक्री, प्रकतवादी संख्या
1 द्वारा भुिण्ि संख्या 30, क्षेत्रफि 2100 वर्गमीटर, स क्टर
142, िौएिा कििा र्ौतम बुद्ध िर्र िे आवंटि िो किरस्त िरिे
िे किये िारी पत्र कदिांि 07/01/2021 िो शुन्य व अिृत
घोकषत किया िावे तथा प्रकतवादी संख्या 1 िे द्वारा उपरोक्त भुिण्ि
िे किरस्तीिरण िे सम्बन्ध में िी र्ई समस्त िायगवाकहयों िो शुन्य
व अिृत घोकषत फरमाया िावे।

ब. यह िी द्वारा सवगिािीि स्थाई किषेधाज्ञा प्रकतवादी
संख्या 1 व 3 िो किषेकधत किया िावे कि वह भुिण्ि संख्या 30,
166 INDIAN LAW REPORTS ALLAHABAD SERIES
क्षेत्रफि 2100 वर्गमीटर, स क्टर 142, िौएिा कििा र्ौतम बुद्ध
िर्र िी रकिस्री प्रकतवादी संख्या 2 िे हि में िा िरे तथा प्रकतवादी
संख्या 1 व 2 िो किषेकधत किया िावे कि वह वादी िे उपरोक्त
भुिण्ि संख्या 30, क्षेत्रफि 2100 वर्गमीटर, स क्टर 142,
िौएिा कििा र्ौतम बुद्ध िर्र िे वादी िे शाकन्तपूणग िब्िे में किसी
प्रिार से हस्तक्षेप िरिे या किसी भी प्रिार से तृतीय पक्ष िा कहत
उत्पन्ि िरिे िे बाि रहे।

स. यह कि वाद व्यय वादी िो प्रकतवादीर्ण से
कदिाया िावे।

द. यह कि अन्य िोई अिुतोष िो राय अदाित
कहतिर वादी हो प्रकतवादीर्ण से कदिाया िावे।"

10. The defendant authority had filed
objections on 25.08.2021 under Order
XXXIX Rule 1 & 2 of C.P.C. and taken
specific stand that the Commercial Court
had no jurisdiction to try and decide the
suit because the provisions of the Order VII
Rule 11 of C.P.C. are applicable. Section 2
(1) (b) of the Commercial Courts Act, 2015
defines the meaning of "Commercial
Court" and sub-section (1) (c) of Section 2
defines the meaning of "Commercial
Dispute", wherein every category of the
commercial disputes has been defined but
nowhere such type of material is available,
which co-relates to the present dispute
under the suit. Therefore, the present suit of
the plaintiff company is barred by the
provisions of Section 9 of C.P.C.. The
defendant authority has also taken an
objection that the civil suit is barred by the
provisions of Sections 34, 38 & 41 of
Specific Relief Act. The suit of the plaintiff
company is also barred by the provisions of
Section 12A of Commercial Court Act,
2015.

11. The defendant authority had also
filed detailed written statement (WS) on
04.09.2021 and resisted the suit contending
that before cancelling the plot in question
the defendant authority sent letters/notices
dated 19.12.2013, 26.02.2014, 17.06.2020
and 14.07.2020 to the plaintiff company at
the available address and the address given
by the plaintiff company in the lease deed
but the notice dated 17.06.2020 was
returned back with the remarks "Bina Pata
Bataye Chhod Gaye" (left without giving
the address). Therefore, it was incorrect
that the plaintiff company had not received
the letters. The objection was also taken
that at both the addresses i.e. of the address
of the company and also at the address of
the Director, the letter dated 07.01.2021
was served to the plaintiff company and
also the Director of the company.

12. The plot was duly allotted in
favour of the plaintiff company on
17.02.2006 @ Rs.3700/- per sq. meters and
the location charges @ 2% were also
added. Accordingly, the premium rate was
charged @ Rs.3774/- per Sq. meters only
and within 30 days from the date of
allotment letter, the plaintiff company had
to deposit 30% amount of the total
premium, which was to the tune of
Rs.18,35,755/- including one year lease
rent of Rs.1,98,135/- and the balance
amount of 70% of the total premium
alongwith interest @ 11% was to be paid in
instalments by the plaintiff company. After
allotment, the lease deed was executed on
19.01.2007 and the possession of the plot in
question was also handed over to the
plaintiff company on 01.02.2007. While
filing
the
written
statement,
specific
objection was also taken to the effect that
the plaintiff company had incorrectly stated
that he had deposited total premium but in
fact, the plaintiff company had never
deposited the balance amount of the lease
rent against the plot in question. Once the
terms and conditions of the lease deed had
been flouted by the plaintiff company and it
failed to clear the outstanding amount then
the defendant authority served the demand
9 All. New Okhla Industrial Development Authority, District Gautam Budh Nagar Vs. M/s. Pathik
 Software Education Pvt. Ltd., Pandav Nagar, Delhi & Anr.
167
notice dated 26.02.2014 to pay the amount
of
Rs.1.12
crores
upto
15.03.2014.
Thereafter, another letter was served on
17.06.2020
to
pay
the
amount
of
Rs.1,69,00,000/- within 15 days from the
receipt of the letter but the said letter was
returned back with the aforementioned
remarks. When the plaintiff company did
not pay the outstanding amount, the
defendant authority issued a demand notice
on 14.07.2020 to pay Rs.1,69,00,000/-
within seven days. It is also claimed that
the defendant authority had issued a
demand
notice
on
13.12.2019
for
Rs.2,69,78,938/- but subsequently, through
another demand notice dated 03.02.2020
the amount to the tune of Rs.50,00,000/-
was adjusted, which was already deposited
by the plaintiff company on 16.05.2015 and
accordingly, amended demand notice was
served. Before cancelling the lease deed of
the plot in question the defendant authority
had sent various show cause notices but
inspite of the repeated notices the plaintiff
company did not respond to the notice, and
neither deposited the amount in question nor
raised any construction over the plot in
question and further not obtained completion
certificate after raising the construction
within five years from the actual date of
possession, which all were mandatory as per
the lease deed. Therefore, the said act was in
violation of Clause 13 (A) of the lease deed
and accordingly, the defendant authority had
cancelled the allotment on 07.01.2021 and
taken back the possession of the plot in
question on 18.02.2021. Thereafter, the same
was allotted to the defendant company on
17.06.2021 under "Institutional Plots Scheme
OES 2020-2021" and the defendant company
had deposited the sale consideration.

13. In the suit proceeding the
defendant company had also filed written
statement stating therein that the defendant
company is engaged in the business of IT
Software Products and Services. It applied
for allotment of an institutional plot and
made a pre-deposit of Rs.31,14,300/- as
required in the public notice dated
22.02.2021.
Thereafter,
the
defendant
authority decided to allot the plot in
question
vide
allotment
letter
dated
17.06.2021 and as per the terms of the
allotment, the defendant authority was
required to make a further payment of 30%
of the total value of the plot, amounting to
Rs.1,11,49,194/-, which was deposited by
the defendant company on 22.06.2021.
Thus, the defendant company has made
payment
of
Rs.1,42,63,494/-.
The
defendant company has not only made the
payment of huge amount to the defendant
authority but it is also holding the balance
payment of Rs.2,13,95,241/-, which is
payable to defendant authority in respect of
the plot. Total cost of the project is more
than Rs.37 crores and the defendant
company has already arranged the said
amount but till date on account of the
pendency of the said proceeding, it cannot
utilise the said amount for any other
purpose.

14. The defendant company took an
objection
in
written
statement
that
admittedly, the plaintiff company has
breached the terms of the lease deed dated
19.01.2007 and it had neither paid the
balance amount nor had commenced the
construction on the plot within the
stipulated period of five years. Further the
plaintiff company had not sought any
extension of time for completion of the
construction. As per lease deed dated
19.01.2007 the maximum period of time
for
completing
the
construction
including two year's extension was seven
years, which had already expired in the
year 2014 and consequently, the lease deed
168 INDIAN LAW REPORTS ALLAHABAD SERIES
dated 29.01.2007 was cancelled by the
defendant authority. The plaintiff company
made a default in payment of instalments
under the lease deed dated 19.01.2007 and
as such, it was not entitled to any relief
from the Commercial Court. The defendant
company had also obtained the balance
sheets of the plaintiff company for the
years 2015-2019 from the 'Ministry of
Corporate Affairs', which indicated that the
plaintiff company was an inactive, shell
company and it has no business operations,
no turnover and nil income. The amount of
Rs.1,00,78,716/- paid to the defendant
authority was reflected in its balance sheet
as long term unsecured loans taken by the
plaintiff company. The plaintiff company
did not has any money, whatsoever, to
either make the balance payment due to the
defendant authority qua the plot in question
or to make the construction on the plot in
terms of the lease deed. It was also averred
in the written statement that the allotment
of an institutional plot was made to
business entities by defendant authority on
the concessional rate to promote business
and employment. The plaintiff company
with no operations, nil turnover and no
business record whatsoever, was neither
legally nor morally entitled to the benefit of
the allotment of the said plot. The plaintiff
company
was
only
incorporated
on
19.12.2005 just to procure the lease rights
of the said plot.

15. The Commercial Court, after
exchange of the affidavits and pleadings,
had framed three issues namely (i)
jurisdiction of this Court to entertain the
present matter; (ii) application under Order
13A CPC and (iii) application under Order
XXXIX Rules 1 and 2 CPC. Firstly, the
Commercial Court had proceeded to deal
with the jurisdiction of the Court to
entertain the suit (issue no.i) and found that
admittedly "Memorandum of Article of
Association" of the plaintiff company
stated that it was a company formed for
earning profits and further the lease deed
was executed by the defendant authority in
favour of the plaintiff company in the
institutional area. Again the plaintiff
company
was
incorporated
with
an
intention to earn profits by conducting
business of computer/software training
institute. The Commercial Court had also
taken note of the fact that the plaintiff
company was a registered company under
the Companies Act, 1956 and works for
gain and profit. The terms of the lease deed,
which was executed between the parties,
speaks of development of suit property as
computer/software institute etc. for its
gains/profits. The lease deed was also
executed between the parties, which was
itself a contract between the parties and the
allegation of the plaintiff company against
the defendant authority was breach and
violation of the terms of the said lease deed
i.e. contract. Therefore, as there was breach
of contract the Commercial Court had
every jurisdiction to entertain the matter as
there was a commercial dispute. Therefore,
the dispute fell within the ambit of Section
2 (1) (c) (vii) of the Commercial Courts
Act, 2015. The Commercial Court held that
the present dispute between the parties is
undoubtedly a commercial dispute in terms
of Section 2 of the Commercial Courts Act,
2015 and thus, the Commercial Court has
jurisdiction to decide the dispute.

16. So far as the second issue with
regard to the application of the defendant
company under Order XIIIA of the CPC
was concerned, the Commercial Court
found that in the present case, the only
dispute raised by the plaintiff company was
that the plaintiff company was not served
with the demand notice and subsequent
9 All. New Okhla Industrial Development Authority, District Gautam Budh Nagar Vs. M/s. Pathik
 Software Education Pvt. Ltd., Pandav Nagar, Delhi & Anr.
169
cancellation notice as per the terms of the
lease deed resulting in cancellation of the
land in question and the plaintiff company
had defaulted in making payments to the
defendant authority as per the terms of the
lease deed. The Commercial Court found
that as there was dispute with regard to the
payment,
non-payment,
sending
of
notice/non-sending of notice at various
addresses of the plaintiff company and all
other relevant issues in the present dispute
were already on record, therefore, no
evidence was required to be adduced. The
Commercial Court had proceeded to decide
the actual dispute based upon the pleadings
of the parties and official record filed by
the defendant authority before the Court. It
also opined that only dispute between the
parties were that the plaintiff claimed nonreceipt of payment notice on its registered
office as per lease deed and the defendant's
plea was regarding non-payment of dues
and non-construction of the building on the
leased premises as per lease deed. The
Commercial Court further found that the
defendant company had no substantial right
against the plaintiff company. There is no
contract between the plaintiff company and
the defendant company and only rights of
the defendant company was against the
defendant authority. Since there was no
dispute with regard to the relevant facts
between
the
parties
and
thus,
the
Commercial Court was of the opinion that
the suit be decided summarily under Order
XIII of the CPC.

17. Thereafter, the Commercial Court
had proceeded to discuss the case on its
merits qua service of notice, non-payment
of dues/non-constructions on the leased
land property and the relevant law and
found that admittedly, the aforesaid lease
deed was executed between the plaintiff
company and the defendant authority on
19.01.2007, wherein rights and obligations
of the parties were clearly mentioned. The
lease deed is a complete contract between
the plaintiff company and the defendant
authority. As per the terms of the lease deed
the plaintiff company was to make the
entire payment of the consideration amount
to the defendant authority within the
stipulated period and in case of default the
plaintiff company was liable to pay interest
to the defendant authority @ 14% and
allotment was also liable to be cancelled as
per Clause-2 of the allotment letter dated
17.02.2006. As per the lease deed dated
19.01.2007 the entire consideration amount
was to be paid by 16.02.2014, out of which
Rs.23,77,620/- was paid at the time of
execution of the lease deed and the
remaining amount of Rs.55,47,780/- plus
interest was to be paid in 16 equal half
yearly instalments of Rs.3,46,737/- plus
interest. In case of default the plaintiff
company was required to pay 14% interest
compounded half yearly on the defaulted
amount instead of 11% within the time
period i.e. upto 16.02.2014. The plaintiff
company was to complete the construction
at the site within five years from the date of
actual possession and in case of noncompliance
of
the
construction,
the
allotment was liable to be cancelled.

18. The Commercial Court found that
purported notices dated 30.06.2020 and
14.07.2020 were sent to the plaintiff
company,
wherein
a
demand
of
Rs.1,69,00,000/- was raised against the
plaintiff company and these dues included
interest for non-payment of amount and
penalty for non-construction on the suit
property from the year 2013. As per record
of the defendant authority, the amount due
till 31.12.2020 was of Rs.1,96,10,802/-
which
included
an
amount
of
Rs.25,09,710/- for non-construction and the
170 INDIAN LAW REPORTS ALLAHABAD SERIES
defendant authority had extended the time
of construction on payment of extension
charges. The Commercial Court further
found that the demand notices dated
17.06.2020 and 14.07.2020 were not
received by the plaintiff company and they
were returned back with the endorsement
"left without giving the address". The
Court found that both the notices dated
17.06.2020 and 14.07.2020 were sent only
at the residential address of one of the
Directors of the plaintiff company and no
notice was sent at the registered office of
the plaintiff company at E-52, Pandav
Nagar, Delhi-110092. In the lease deed
between the plaintiff company and the
defendant authority, the registered office of
the plaintiff company was shown as E-52,
Pandav Nagar, Delhi - 110092 and the
residential address of one of the Director
Smt. Brijesh Singh was shown as E-292A,
Sector 22, Noida, U.P. It was also alleged
that the cancellation notice of the plot was
sent at both the addresses i.e. registered
address - E-52, Pandav Nagar, Delhi -
110092 and E-292A, Sector 22, Noida,
District Gautam Budh Nagar, U.P.. From
the aforesaid facts, the Commercial Court
opined that the demand notices dated
17.06.2020 and 14.07.2020 were not sent at
the registered office of the plaintiff
company but were rather sent at the
residential address of one of it's Director,
which was in breach of Section 43 of U.P.
Urban Planning and Development Act,
19734.

19. The Commercial Court further
found that the cancellation notice dated
07.01.2021 was sent to both the addresses
of the plaintiff company i.e. registered
office and residential address of one of the
Director of the plaintiff company and thus,
it cannot be said by the defendant authority
that the demand notice was not required to
be sent at the registered office or the
demand notice was duly served as per
Section 43 of the Act, 1973. The Court
further observed that the cancellation notice
was sent to the plaintiff company at both
the addresses but the demand notice was
sent at the residential address of one of the
Director of the Company and it was not
sent at the registered address of the plaintiff
company.