- 1 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 6TH DAY OF AUGUST, 2025 BEFORE THE HON'BLE MR. JUSTICE G BASAVARAJA REGULAR SECOND APPEAL NO. 2903 OF 2007 (SP) BETWEEN: HUBLI-DHARWAD MUNICIPAL CORPORATION LAMINGTON ROAD, HUBLI-580020 REPRESENTED BY ITS COMMISSIONER. …APPELLANT (BY SRI. G.I. GACHCHINAMATH, ADVOCATE) AND: 1. MAHILA VIKAS MANDALI 12, NEELGIN ROAD, HUBLI-580020 REPRESENTED BY ITS SECRETARY SUBHASH BALACHANDRA MADIMAN 2. SUBHASH BALACHANDRA MADIMAN SECRETARY MAHILA VIKAS MANDAL, 12, NEELGIN ROAD, HUBLI-580020. 3. THE SECRETARY TO GOVERNMENT, REPRESENTED BY ITS SECRETARY, HOUSING AND URBAN DEVELOPMENT DEPARTMENT, VISVESHWARIAH TOWERS DR. AMBEDKAR, VEEDHIBANGALORE-1. …RESPONDENTS (BY SRI. V.G. BHAT, ADVOCATE AND SMT. ROOPA P. MATTI, ADVOCATE FOR R2; SRI. PRAVEENA Y. DEVAREDDIYAVAR, HCGP FOR R3) Digitally signed by MALLIKARJUN RUDRAYYA KALMATH Location: HIGH COURT OF KARNATAKA DHARWAD BENCH Date: 2025.08.16 10:23:27 +0530 - 2 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 THIS RSA FILED U/S. 100 OF CPC AGAINST THE JUDGMENT AND DECREE DATED 05.06.2007 PASSED IN RA.NO.22/2001 ON THE FILE OF THE I ADDL. CIVIL JUDGE (SR.DN.) HUBLI, DISMISSING THE APPEAL FILED AGAINST THE JUDGMENT AND DECREE DATED 30.11.2000 PASSED INOS.NO.520/1991 ON THE FILE OF THE I ADDL. CIVIL JUDGE (JR.DN.) HUBLI. THIS APPEAL, COMING ON FOR ORDERS, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: ORAL JUDGMENT (PER: THE HON'BLE MR. JUSTICE G BASAVARAJA) 1. The appellant has preferred this regular second appeal against the judgment and decree passed in O.S.No.520/1991 on the file of the I Additional Civil Judge (Sr. Dn.) at Hubballi (for short “the trial Court”) dated 30.11.2000, which is confirmed by I Additional Civil Judge (Sr. Dn.) at Hubballi (for short “the appellate Court”), in R.A.No.22/2001 dated 05.06.2007. 2. For the sake of convenience, parties are referred to as per the ranks before the trial Court. 3. The brief facts of the plaint are as under :- The plaintiff filed this suit for specific performance of contract to execute the lease deed for 50 years in respect of suit - 3 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 property in favour of plaintiff No.1 and also for declaration that the Resolutions No.77 and 78 passed by defendant No.1 on 13.03.1989 are illegal and in violation of the agreed lease and equity and as a consequential relief to restrain the defendant from carrying on any other activities in the suit property, until the expiry of lease period. 4. The plaintiff-Mahila Vikas Mandali is a Society incorporated and registered under the provisions of Karnataka Societies Registration Act, 1960 with the main object of promoting the welfare of women and children. The 2nd plaintiff is the Member and Secretary of the plaintiff-Society. 5. The suit property is two acres of land in R.S.No.69 of Nagashettikoppa, Hubli for the construction of a home for destitute women and orphans and other activities of the first plaintiff-society. 6. On the request of the plaintiff, the State Government passed an order bearing No.HUD:44:AHD:79 Bangalore on 07.04.1980 according sanction under Section 176 of the Karnataka Municipal Corporations Act, for the sale of suit property in favour of first plaintiff at the rate of Rs.1,500/- per - 4 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 gunta. Pursuant to that order the defendant No.2 wrote a letter calling upon the first plaintiff to pay a sum of Rs.1,20,000/-as a sale consideration within 30 days from the date of letter. As the plaintiffs were not in a position to pay such a big amount at that time, requested the defendants to grant the suit property on long term lease and the State Government passed an order bearing No.HUD:55:AHD:80 Bangalore on 20.09.1980 according sanction for lease of the suit property in favour of plaintiffs for a period of 20 years on a yearly rent of Rs.1,000/- for the first ten years and Rs.2,000/- p.a. for the next 10 years. 7. It is further contended that the plaintiff No.1 paid the yearly rent of Rs.1,000/-on 14.10.1980 for the year 1980- 81 towards the rent of the suit property. The Government does not issue release grant for the construction of buildings, if the lease of the land is for a period less than 50 years. In view of the same, the plaintiffs again gave a representation to the State Government requesting that the lease be extended for a period of 99 years. In the meanwhile, the corporation authorities gave a draft lease deed, which contained unreasonable clauses including a clause that the Corporation could resume the land and building at any time even before the expiry of the lease - 5 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 without paying any compensation. The first defendant wrote a letter on 25.6.1982 calling upon the first plaintiff to show cause -why the lease should not be terminated on the ground that the petitioner had not paid lease rent. Immediately, plaintiff gave a detailed reply stating the reason why the lease deed has not been executed and paid Rs.2,000/- as annual rent for the years 1981-82 and 1982-83. It was explained by the plaintiffs that the lease deed could not be executed, since the request of the plaintiff for the extension of the period of the lease from 20 years to 99 years was under consideration of the Government. On being fully satisfied about the need to enhance the period of lease to 99 years, defendant No.1 wrote a letter to 2nd defendant requesting for the increase of the lease period of the suit property to 99 years in favour of plaintiff No.1. 8. It is further stated that during April, 1985 the plaintiff learnt that the Government had accorded sanction to extend the period of lease to 50 years. Accordingly plaintiff wrote a letter dated 04.06.1985 to the first defendant calling upon him to execute and register the lease deed in favour of first plaintiff. Since the plaintiffs did not hear anything from the first defendant again wrote a letter to the Under Secretary to - 6 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 the State Government on 18.10.1985 requesting the Government to arrange to send the official copy of the Government order, extending the period of lease to 50 years. Thereafter, on 28.12.1985, the first defendant wrote a letter to the plaintiff about the enhancement of the lease period up to 50 years and called upon the plaintiff to execute and register the lease deed. 9. The plaintiff as per the request of defendant No.1 paid the lease rent. Despite of repeated reminders and request of the plaintiff, the first defendant, failed and neglected to execute and register the lease deed. On 25.02.1986, the plaintiff wrote a letter to the defendant No.1 calling upon him to execute and register the lease deed and to send the draft lease deed in order to facilitate the plaintiff to approve the said draft. The plaintiff did not receive any reply for it. On 12.02.1987 the plaintiff wrote another letter to defendant No.1 to send draft lease deed by return post to facilitate the plaintiff to execute and register the lease deed. The first defendant did not send any reply nor send the draft of the lease deed. But defendant No.1 wrote a letter dated 30-6-1987 calling upon the plaintiff to pay a sum of Rs.2,000/- being the arrears of rent and further - 7 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 threatened to recover the same by process of attachment. The said letter was received by the plaintiff on 10.08.1987. In the meanwhile, the plaintiff had already paid Rs.2,000/- on 10.7.1987 as lease rent. 10. As defendant No.1 did not execute the lease deed, on 11.08.1987 the plaintiff again wrote a letter to defendant No.1 to execute a lease deed. But defendant No.1 did not reply for the same. Therefore, on 31.01.1989 the plaintiff has got issued legal notice to defendant No.1 to execute and register the lease deed. The plaintiff personally contacted defendant No.1 on several occasions and defendant No.1 went on promising to execute and register the deceased. At last the plaintiff on 16.07.1990 issued another legal notice calling upon the defendant to execute and register the lease in respect of suit property. A cheque for Rs.2,000/- was also enclosed with the legal notice being the rent in respect of suit property. In reply the first defendant sent a letter on 09.08.1990 informing the plaintiff that there is a proposal for utilising the suit property already leased in favour of first plaintiff for constructing a Rangmandir on the suit property and the proposal is pending for - 8 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 consideration before the State Government and consequently returned the said cheque. 11. It is submitted that the defendant has practically stated that the first defendant has already resolved to cancel the lease of the aforesaid property in favour of the plaintiff under Resolutions No.77 and 78 illegally without opportunity of hearing to the plaintiff and in violation of principles of natural justice. 12. It is stated that defendant having leased the property in favour of the plaintiff and having received the rents for the period of 10 years is estopped from cancelling the lease in favour of the plaintiff and is estopped from construction of Rangamandir thereupon. The defendant No.1 is a duty bound to execute and register the lease deed in favour of first plaintiff. The plaintiffs always were and are ready to and willing to perform their part of the contract, by paying rent etc. Therefore, resolutions No.77 and 78 dated 03.03.1989 passed by defendant No.1 cancelling the lease in favour of the plaintiff, is totally illegal and contrary to the provisions of the Karnataka - 9 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 Municipal Corporations Act. Hence, the plaintiffs are constrained to file this suit for specific performance of contract. 13. The defendants appeared through their advocate. Defendant No.1 filed his written statement denying all the allegations made in the plaint. 14. It is averred that the suit is not maintainable without complying with the mandatory requirement of Section 482 of the K.M.C. Act. The Commissioner, who is a necessary party, has not been impleaded as a party to the suit. Hence, suit is also bad for non-joinder of necessary party. The suit is barred by limitation. 15. It is stated that the plaintiffs failed to pay Rs.1,20,000/- as a sale consideration and to get the sale deed executed under letters dated 03.07.1980 and 27.8.1980 of defendant No.1. The defendant No.1 is not aware whether defendant No.2 had written a letter to the plaintiffs or otherwise as stated in para 2 of the plaint. Then the State Government, as per request of the plaintiffs without the consent or concurrence of the corporation, amended the earlier Government Order dated 07.04.1980 and passed an order dated - 10 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 20.09.1980 for lease of 2 acres of corporation land for a period of 20 years at the reduced rent of Rs.1,000/- per annum for the first 10 years and to be doubled for the next 10 years. The plaintiffs used their influence and got the orders of Government amended as per their desire directly without the concurrence and consent of the Corporation. In accordance with the Government Order dated 20.09.1980, the plaintiffs did not get the lease deed executed and credited the lease amount. Therefore, a show cause notice has been issued by defendant No.1 on 25.06.1982. There is no acceptance and no lease has been got executed by the plaintiff and no right has been accrued to the plaintiffs to seek specific performance of contract. There is no concluded contract according to law. Therefore, the question of grant of specific performance is not maintainable in law. The payment of ground rent will not amount to a concluded contract. 16. It is further contended that as seen from Government Order dated 23.02.1985 it is evident that the copy of said Government Order is also endorsed to the plaintiffs directly by the Government. As per amended-order of the Government dated 23.02.1985 the plaintiffs have been directed - 11 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 under letter dated 28.12.85 to register the lease deed at his cost within 7 days and a draft lease has already been given to them. But in spite of this, the plaintiffs have failed to communicate their absolute and unqualified acceptance within time and to execute the lease deed as per the draft given by the defendant. 17. It is denied that the plaintiff No.1 issued a letter dated 11.08.1987 and no reply was received from defendant No.1. It is stated that the plaintiffs have utterly failed to communicate their absolute and unqualified acceptance to the proposals and conditions of lease within the prescribed time stipulated by defendant No.1 and to get the lease deed executed and thereafter there was no concluded contract according to law. 18. The defendant No.1 has also denied the notices issued by plaintiff dated 31.01.1989 and also 16.07.1990. It is admitted that a suitable reply dated 09.08.1990 has been given to the plaintiffs returning the cheque for Rs.2,000/-. The action of the Corporation in revoking proposal is according to law. The plaintiffs are not diligent. In view of changed circumstances as - 12 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 per the Government Orders, the corporation under its Resolutions No.77 and 78 dated 03.03.1989 has resolved to retain the said land with the Corporation for construction of Rangamandir. The State Government has also been requested by the corporation under its letter dated 21.05.1988 to withdraw the government orders dated 23.02.1985 proposing to lease the suit land to the plaintiffs and the orders of the Government are still awaited. Corporation, as owner of the property, is right in retaining its land for the construction of Rangamandir as per Government orders, in cancellation of the earlier resolution. The said resolution Nos.77 and 78 are according to law and they are legal. Once the proposal is accepted the same cannot be unilaterally resolved or changed. The said resolutions against the rights already created in favour of plaintiff No.1, is denied. It is crystal clear that the plaintiffs are not diligent throughout despite of repeated reminders to communicate their absolute and unqualified acceptance to the proposal of defendant No.1 as stipulated in the draft lease deed and to execute the lease deed within the time mentioned therein. The State Government has sanctioned Rs.50,00,000/-for construction of Rangamandir and already sanctioned an amount of Rs.10,00,000/- as grant-in-aid - 13 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 being the first installment to construct Rangamandir. There is no valid acceptance on the part of the plaintiffs. A suit for specific performance of contract is not maintainable. The valuation of the suit property is not properly made and the court fee paid in not proper. On all these grounds among other grounds, the defendant No.1 prayed to dismiss the suit. 19. Based on the pleadings, the trial Court has framed following issues:- i. Whether the plaintiff proves that resolutions No.77 and 78 dated 03.03.1989 cancelling the lease in favour of the plaintiff is totally illegal and unlawful? ii. Whether the plaintiff prove that there was completed agreement with regard to lease of suit property in its favour and that there was breach of agreement by the defendant? iii. Whether the plaintiff prove that it was ever ready and willing to perform its part of agreement? iv. Whether this court has got pecuniary jurisdiction? - 14 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 v. Whether valuation made and Court fee paid is correct? vi. Whether suit is barred by time? vii. Whether plaintiffs are entitled for the reliefs sought? viii. What order or decree? 20. In order to prove its case, the Secretary of plaintiff society was examined as PW1 and got marked Exs.P1 to P27 in support of their case. The official of defendant No.1 is examined as DW1 and got marked Exs.D1 to D24 in support of its case. 21. Having heard the arguments of both sides the trial Court has decreed the suit as prayed for. 22. Being aggrieved by the judgment and decree, Hubballi-Dharwad Municipal Corporation has preferred an appeal in RA.No.22/2001; same came to be dismissed on 16.05.2025. Being aggrieved by judgment and decree of both Courts, the Hubli-Dharwad Municipal Corporation has preferred this appeal. 23. This Court, vide Order dated 10th August 2012 admitted the Appeal to consider following substantial questions of law: - 15 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 “1. Whether the suit is maintainable for want of notice under Section 482 of Karnataka Municipal Corporations Act? And 2. Whether the correspondence interse between the plaintiffs and the defendants would amount to concluded contract? 24. Learned counsel for the complainant would submit that the judgment and decree passed by the courts below is opposed to law, facts and probabilities of the case and also they are unjust and illegal. It is submitted that the appellate Court has erred in confirming the judgment and decree of the trial Court. The appellate Court has also erred in confirming the judgment of the trial court on the ground that there was completion of offer and acceptance, and that the Society was ready and willing to perform its part of contract. it is submitted that the appellate Court should have seen that based on the evidence on record, the trial Court has erred in appreciating the facts of the case and the judgment rendered was contrary to the laid down by the Hon'ble Supreme Court. It is further submitted that the appellate Court has erred in not appreciating the fact - 16 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 that the suit was not maintainable in the absence of issuance of notice under Section 482 of Karnataka Municipal Corporations Act. On all these grounds, it was sought to the allow the appeal. 25. As against this, the learned Counsel appearing for the respondent No.1 would submit that both the courts have properly appreciated the evidence on record in accordance with law. Prior to filing of the suit, legal notice as required under Section 482 of Karnataka Municipal Corporations Act was issued which is marked as Exhibit P26. Both the courts have properly appreciated the evidence on record and therefore, there are no grounds to interfere with the impugned judgment passed by the trial Court is confirmed by the appellate Court. 26. With regard to substantial question No.(1) framed by this is concerned, it is submitted that both the Courts have properly appreciated the evidence record in accordance with law facts and decreed the suit in favour of the plaintiff, which does not call for interference in this appeal. On all these grounds it was sought to dismiss the appeal. 27. I have examined the material placed before me. A perusal of Exhibit P26 makes it clear that before filing the suit, - 17 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 the plaintiff issued noticed the Commissioner Hubballi-Dharwad Municipal Corporation, Hubballi and also to the Chief Secretary, Government of Karnataka through registered post and the same is duly served. Defendants have not disputed this legal notice. Both the courts have properly appreciated evidence on record in accordance with law as to the compliance of mandatory provisions of Section 482 of Karnataka Municipal Corporations Act, 1976. Accordingly, the appellants have failed to convince this Court that suit is not maintainable for want of notice under Section 482. Karnataka Municipal Corporations Act. 28. With regard to correspondence interse between the plaintiff and defendant is concerned, the plaintiff has examined one witness Balachandra Ganapatarao Madiman of Hubli as PW1 and marked 28 documents as per Exhibits P1 to P28. Both the Courts have properly appreciated evidence of PW1 and documents, as also the evidence of DW1 Basappa Gulappa Koppad of Hubli as also documents Exhibits D1 to D24. On careful examination of the entire material placed on record and the reasons assigned by both the Courts, I do not find any error, illegality or legal infirmity in decreeing the suit of the plaintiff. Hence, the substantial question of Law (1) framed above as to - 18 - HC-KAR NC: 2025:KHC-D:9963 RSA No. 2903 of 2007 maintainability, is answered in the affirmative, since the plaintiff has complied with the mandatory provisions of Section 482 of Karnataka Municipal Corporations Act. 29. With regard to substantial question of law framd as Sl.No.2 as to correspondence between plaintiffs and defendants would amount to concluded contract is concerned, the applicants have not made out any ground to interfere with the impugned judgment and decree passed by the trial Court which is confirmed by the appellate Court. Accordingly, it is answered in affirmative. 30. In the result I proceed to pass the following: O R D E R i) Appeal is dismissed; ii) Consequently, pending IAs if any, also stand dismissed. Sd/- (G BASAVARAJA) JUDGE AC,LNN CT-CMU LIST NO.: 1 SL NO.: 65