Facts of the Case

The dispute concerned property bearing Municipal No. 6-2-1 (Old) / 6-2-2 (New), situated at Lakdikapul, Hyderabad, admeasuring 1103.70 square yards. Respondent No. 1 was the Muttawalli of Masjid-e-Hussaini. His father, who owned the property, agreed to dedicate the property as Waqf Alal Aulad for the purpose of completing the construction work of Hussaini Masjid at Lakdikapul Cross Roads, Hyderabad, and executed a waqf deed containing stipulated terms and conditions.

The principal purpose of the waqf deed was to facilitate completion of the construction of Hussaini Masjid, which was accordingly constructed. Subsequently, the property was leased to Hindustan Petroleum Corporation Ltd. for establishment of a petroleum retail outlet.

The lease was granted on 01.03.1965 at an initial monthly lease amount of Rs. 500, which was stated to have been enhanced from time to time. The original lease term expired on 01.03.1985 and was apparently renewed for another ten years with effect from 01.03.1985. A notice terminating the lease was issued on 27.06.1994, resulting in the litigation.

Respondent No. 1 initially instituted O.S. No. 181 of 1998 before the I Additional Judge, City Civil Court, Hyderabad. After constitution of the Waqf Tribunal, the suit was transferred and renumbered as O.S. No. 94 of 2000. The Waqf Tribunal passed an award on 10.03.2005, which was challenged in C.R.P. No. 2198 of 2005. The High Court set aside the award and remanded the matter for fresh consideration.

Thereafter, in O.S. No. 94 of 2000, the plaintiff filed I.A. No. 189 of 2012 under Order VII Rule 10 read with Section 151 CPC, seeking return of the plaint for presentation before the competent civil court. The Waqf Tribunal granted the relief on 11.06.2012. The plaint was then represented before the Chief Judge, City Civil Court, Hyderabad, and on 14.09.2012 was taken on file as O.S. No. 671 of 2012.

The trial court passed a judgment and decree against the defendant and granted several reliefs. Aggrieved by that judgment and decree, Hindustan Petroleum Corporation Ltd. preferred the present appeal. During pendency of the appeal, however, the parties amicably resolved the long-standing dispute and drafted compromise terms on 19.11.2022.

Issues Involved

The principal issues arising from the proceedings were:

  1. Whether the appeal against the judgment and decree in O.S. No. 671 of 2012 could be disposed of in terms of the compromise arrived at between the parties during pendency of the appeal.
  2. Whether the lease of the waqf property in favour of Hindustan Petroleum Corporation Ltd. could continue for the agreed further period under the compromise arrangement.
  3. Whether lease rent could be paid directly by the appellant to Respondent No. 1, with Respondent No. 2/Waqf Board having no objection to such direct payment.
  4. What monthly rent and periodic enhancement would govern the renewed lease arrangement.
  5. Whether Respondent No. 1 remained obligated to comply with the terms of the Waqf Deed, including the stipulated contribution to the Waqf Fund.
  6. Whether Respondent No. 1 could approach the Waqf Board for release of money already deposited with the Board.

Appellant’s Arguments / Stand

The appellant, Hindustan Petroleum Corporation Ltd., through learned counsel, participated in the compromise and agreed to resolution of the appeal in accordance with the negotiated terms.

Under the compromise terms extracted by the High Court:

  • the lease period in respect of the appeal schedule property was to be extended for a further period of 10 years, effective from the date of entering into the agreement;
  • the agreement was to be entered into by Respondent No. 1 and the appellant within six months;
  • the appellant was to pay lease rent from November 2022 directly to Respondent No. 1;
  • the agreed monthly rent was Rs. 1,80,000, exclusive of GST and TDS; and
  • the rent was to be enhanced upon expiry of every three years by 15% on the preceding month’s rent.

The compromise terms were enclosed with the affidavit filed in support of I.A. No. 2 of 2022, which was deposed to by the Chief Regional Manager–Retail of Hindustan Petroleum Corporation Ltd.

Respondents’ Arguments / Stand

Respondent No. 1 agreed to the compromise and to disposal of the appeal by taking note of the settlement terms. Respondent No. 1 was also personally present before the Court.

Respondent No. 2, the Andhra Pradesh State Wakf Board, had no objection to the appellant paying rent directly to Respondent No. 1.

At the same time, the compromise specifically preserved Respondent No. 1’s obligation to comply with the terms and conditions of the Waqf Deed dated 04.02.1967, more particularly the contribution of 7% of Waqf Fund on 50% of rental income to Respondent No. 2, as recorded in the extracted compromise terms.

The respective counsel agreed to disposal of the appeal by taking note of the compromise recorded between the parties.

Court Order / Findings

The Telangana High Court recorded its satisfaction that the long-pending dispute, dating back to the 1990s, had been amicably resolved and that the litigation was thereby brought to an end.

The Court extracted the material compromise terms and disposed of the City Civil Court Appeal having regard to those terms. The operative arrangement recognised, inter alia:

  • extension of the lease for a further period of 10 years, effective from the date of entering into the agreement;
  • execution of the agreement between the concerned parties within six months;
  • direct payment of lease rent from November 2022 by the appellant to Respondent No. 1;
  • absence of objection by Respondent No. 2 to such direct rent payment;
  • continued compliance by Respondent No. 1 with the Waqf Deed dated 04.02.1967;
  • monthly rent of Rs. 1,80,000, exclusive of GST and TDS; and
  • rent enhancement of 15% after expiry of every three years, calculated on the preceding month’s rent.

The High Court further clarified that Respondent No. 1 was at liberty to approach the Waqf Board to receive the money already deposited with the Waqf Board.

Accordingly, the City Civil Court Appeal was disposed of, and pending miscellaneous petitions, if any, were closed. The concluding page records disposal of the appeal without costs.

Important Clarification

A significant textual distinction appears within the order itself and should be preserved accurately.

In the narrative portion of the order, the Court records that the compromise contemplated a monthly lease amount of Rs. 1,80,000, a fresh lease commencing from 01.11.2022, enhancement at 10% after every five years, advance rent for twelve months, and registration charges.

However, the actual compromise terms later expressly extracted by the High Court state that:

  • the further lease period would be 10 years from the date of entering into the agreement;
  • monthly rent would be Rs. 1,80,000 exclusive of GST and TDS; and
  • rent would be enhanced every three years at 15% on the preceding month’s rent.

Therefore, for accurate reporting, this internal distinction must not be obscured. The Court ultimately disposed of the appeal “having regard to the terms of compromise extracted above”, making the expressly extracted terms particularly material to understanding the operative disposal.

Sections / Legal Provisions Involved

Section 96, Code of Civil Procedure, 1908 – Statutory provision governing appeals from original decrees; the City Civil Court Appeal was instituted under this provision.

Order XLI Rule 1, CPC – Governs the form and procedural requirements relating to an appeal from an original decree.

Section 151, CPC – Inherent powers of the Court; invoked in the interlocutory applications, including the request for judgment and decree according to the compromise and the request concerning payment of monthly rent/damages.

Order VII Rule 10 read with Section 151, CPC – Invoked before the Waqf Tribunal for return of the plaint for presentation before the competent civil court.

Waqf Deed dated 04.02.1967 – Material to the continuing obligations of Respondent No. 1 under the compromise, including the recorded Waqf Fund contribution arrangement.

Link to download the order -

https://www.mytaxexpert.co.in/uploads/1783153679_857compressed.pdf

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