TMI Blog2011 (11) TMI 838X X X X Extracts X X X X X X X X Extracts X X X X ..... the benefit of the citizens who are having yellow and orange ration cards, municipal employees (present and retired employees) and Municipal Councillors. The petitioners have already constructed the said hospital complex which is functioning as on today. For the purpose of the hospital activities, the petitioners have mortgaged the property which includes the land as well as the constructed buildings by executing a mortgage document in favour of Allahabad Bank. Since the petitioners wanted additional financial facilities from the Bank and since Allahabad Bank was not in a position to provide the same. The petitioners have entered into correspondence with one Axis Trustees Services Ltd. (Axis Bank). According to the petitioners, an arrangement is made with the said Axis Bank by which the Axis Bank has shown its willingness to give financial assistance in favour of the petitioners on the petitioners executing fresh mortgage documents. The petitioners have accordingly applied to the Corporation for grant of NOC to the petitioners for the purpose of creating the said mortgage in favour of Axis Bank. Since the Corporation did not pass any order on the application of the petitioners and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompleted by 5th December, 2011. Matter to be placed High on Board peremptorily on 12th December, 2011. 4. On behalf of the petitioners, prayer for interim relief is pressed into service. It is argued by the learned senior Counsel Dr. Singhvi that since the Corporation is not granting NOC for raising financial assistance from Axis Bank by executing mortgage documents, the petitioners are not in a position to get any financial aid and since the petitioners are required to spend large amount for carrying out its hospital activities in an efficient manner, the Corporation may be directed to give NOC for the purpose of creating mortgage as aforesaid in favour of Axis Bank. In this behalf, reference is made to various applications made by the petitioners to the Corporation from time to time for expediting the process of issuance of the license to assign by way of mortgage. The copies of the said applications are annexed at page No. 126 onwards of the paper book. The Corporation has not given any reply one way or the other in this behalf. It is argued by Dr. Singhvi that as per the contract if no decision is taken within two months in connection with creating mortgage, the permi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tions/ FIIS/Banks/Mutual Funds/Cooperative Societies, Trusts/individuals/HUFs/Partnership firms, other lending institutions and tenders of any constitution for the said project with the prior permission of the Commissioner, which permission shall not be unreasonably withheld, during the period period and/or during the subsistence of the lease and the Owner shall be kept informed of such deals after permission by the Commissioner and SHCL shall file relevant documentary evidence to that effect for record of the owner. The permission which shall be granted by the Owner to SHCL to mortgage the Schedule property in favour of the lender (s) for raising finance will remain irrevocable and irreversible during the tenure of the project period and lease period except when the contract is terminated. In case the contract is terminated for valid reason, the Owner shall not bear any cost and consequences of resultant termination of mortgage by SHCL to any Financial Institution. While the right of ownership will remain with the Owner, the leasehold rights to the property will remain free from encumbrances and dedicated to the lenders during the currency of loan or the lease period wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 20 per cent patients, it is apprehended that the Corporation may raise an issue that no such treatment is given to the aforesaid categories of patients. Under these circumstances, it is prayed that this Court may grant appropriate interim relief directing the Corporation to execute an MoU including appointment of an Officer on Special Duty who can visit the hospital and give his report. 7. On behalf of the Corporation, learned counsel Mr. Kumbhakoni vehemently opposed the prayer of the petitioners for interim relief. It is submitted by Mr. Kumbhakoni that as per the agreement, the petitioners are not only required to give facility regarding providing beds to 20 per cent patients or OPD facilities but is required to bear the expenses towards medicine which may include even medicines which are required to be brought from outside. In this behalf, Mr. Kumbhakoni has relied upon the additional affidavit filed by Dr. Sanjay Narhari Oak, Director (Medical Education and Major Hospitals) and Dean, K.E.M. Hospital and G.S. Medical College, Parel, Mumbai, which hospitals also belong to the Corporation. In the said affidavit, the deponent has bifurcated the scheduled medicines/materi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not taken care of the interest of the Corporation. It is submitted by Mr. Kumbhakoni that the Corporation has no objection to execute the MoU provided the petitioners agree to provide medicines to 20 per cent of the patients which belongs to the category of Corporation employees, councillors and citizens having yellow and orange ration cards. It is submitted by Mr. Kumbhakoni that in view of the above, this Court may not grant any interim relief to the petitioners. 8. We have heard the learned counsel for the parties at great length so far as interim relief is concerned. 9. Firstly, we will deal with the aspect about granting NOC in connection with creating mortgage in favour of Axis Bank for availing financial assistance. It is not in dispute that the land belongs to the Corporation but the entire superstructure is erected by the Petitioners. By virtue of the doctrine of dual ownership, the superstructures belong to the petitioners and the land belongs to the Corporation. In view of the same, Allahabad Bank had initially granted financial assistance to the petitioners by creating mortgage regarding entire property which includes land and buildings. In this con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... note that the Corporation has not taken out any proceedings against its own officers who have signed the earlier documents by giving NOC in favour of the petitioners. In fact, they permitted the things to go on and now after considerable period of time when the hospital is fully occupational and is functioning that they have tried to raise this dispute at this juncture. Though it is argued by Dr. Singhvi that as on today 20 per cent of the patients are taking free treatment in the hospital but since Mr. Kumbhakoni states that no such patients are taking treatment in the hospital, we are not required to examine this aspect at this stage. It is required to be noted that as per the Notice for Invitation of Offer it is mentioned that the mortgage of land is permissible. On behalf of the Corporation, reliance is placed on general conditions of contract, more particularly clause 3.2.8 which provides that the Municipal Commissioner may permit the entrepreneur to mortgage only the leasehold rights in respect of the land for the purpose of raising financial assistance for the project. At this stage Dr. Singhvi has relied upon the document regarding Improvements Committee minutes wherein c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall be at liberty to create the mortgage of the demised premises, in favour of the lenders without any recourse to the lessor . 21. The permission granted by the Lessor to the Lessee to mortgage the plot in favour of Lender(s) for raising finance will remain irrevocable and irreversible during the tenure of the lease period. But, in the event of breach of any of the terms and conditions of this agreement by the Lessee, the Lessor or any other Officer appointed on his/her behalf shall give two months notice to the Lesseee to rectify the breach/breaches. Failure on the part of the Lessee to rectify the breach within two months period will cause the lessor to terminate the agreement between the lessee and the lessor and forfeit all deposits, premia, fees, charges paid by the lessee including taking over possession of hospital premises, etc. subject to the rights of the lenders under the finance documents. In case the lease is terminated for a valid reason, the lessor shall not bear any cost and consequences of the resultant termination of mortgage by lessee to any financial institutions. While the right of ownership will remain with the lessor, the leasehold rights to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers want financial assistance from the Bank, naturally, it cannot mortgage only the superstructure but the entire property is required to be mortgaged. Apart from that even if there is a defect in the title in the matter of creating mortgage, the Corporation is not going to suffer in any manner and it is for the concerned Bank to consider the same while giving financial assistance. The Corporation is not going to get any financial assistance from the Bank and, therefore, whatever documents which the petitioners may execute in favour of the Bank, the Corporation is not bound by the same. Considering the said aspect and considering the facts of the case, as stated above, we are of the opinion that the Corporation, without prejudice to its rights and contentions, give NOC to the petitioners in order to enable the petitioners to avail of additional financial facilities from Axis Bank. The said NOC can be granted by the Corporation without prejudice to its rights and contentions that the land in question belongs to them and, therefore, no mortgage could have been created for the same. It is always open to the Corporation to assert its right to the extent that they are not bound by execu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 20 per cent at par with Corporation hospital and abide by the same. So far the medicines which are required to be brought from outside are concerned, since the issue is required to be thrashed out in the petition, the petitioners may charge qua such medicines from the concerned patients as per the normal rates but they may keep a separate account so that in case the petitioners loses on that point, the petitioners can be directed to refund the said amount with appropriate interest. In this behalf, the petitioners are directed to maintain the record of such patients and particulars may be made available to the Corporation so that the Corporation can refund the said amount without delay to such patients. It will be open to the Corporation to provide such medicines from their own gift shops by maintaining separate account and ultimately if the petitioners fail to get any relief in the final hearing, the Corporation can recover the said amount from the petitioners on the basis of maintenance of such account. 14. With a view to find out whether the petitioners are giving treatment to 20 per cent patients as pointed above, the Corporation may nominate an Officer on Special Dut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ho are taking treatment in the hospital. Considering the aforesaid aspect of the matter, we are not examining the other contentions raised by Dr. Singhvi that the action of the Corporation is vindictive and is politically motivated. In any case, as pointed out earlier, by granting such NOC without prejudice to the rights and contentions of the Corporation, the Corporation is not likely to suffer in any manner as the Corporation itself is not mortgaging its land to anyone and NOC granted, therefore, may not be treated as if Corporation has agreed to create mortgage over the land in question. However, the said aspect will be taken into consideration at the time of deciding the matter finally. The aforesaid interim relief is granted in view of the fact that according to the petitioners if for want of NOC, the Axis Bank may withdraw its offer to give financial assistance. 17. At this stage Mr. Kumbhakoni submitted that the Corporation would like to challenge this order in connection with grant of NOC for creating mortgage is concerned. He requested that this order may be stayed for two weeks. Since we have already granted two weeks time to the Corporation for granting NOC, th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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