SERVE AND VOLLEY OUTDOOR ADVERTISING PRIVATE LIMITED REP. BY ITS SENIOR GENERAL MANAGER, MR. RAGHUVEER B.T. Vs. STATE OF KARNATAKA, REP. BY PRINCIPAL SECRETARY, THE COMMISSIONER, SOCIAL WELFARE DEPARTMENT, THE DEPUTY COMMISSIONER AND SPECIAL TAH

JUDGEMENT

(1.) HE petitioner is an advertising company, which has challenged notice dated 10/01/2012 issued by the fourth respondent - Special Tahsildar, Bangalore North Taluk, Yelahanka Satellite Town. By the said notice, a sum of Rs. 10,74,78,439/ - has been demanded from petitioner by way of arrears of land revenue. The petitioner has assailed the impugned notice on two counts. Firstly, by contending that the damages for the hoardings could not have been computed by the Department with the assistance of the Marketing Consultant and Agencies Limited ("M.C. and A" for short), which is a Government of Karnataka undertaking, on behalf of whom the impugned notice has been issued. Secondly it is contended that quantum of damages are disproportionate to the rent received by the second respondent - Department from the petitioner.

(2.) THE background facts to this writ petition are that the petitioner had taken two hoardings on rent for the purpose of advertising at premises bearing No. 90, Govt. Science College Hospital, M.G. Road, Bangalore, which premises belongs to Social Welfare Department, Government of Karnataka. The lease was initially for a period of three years from 25/04/2003 to 25/04/2006. It is stated that on the expiry of the lease period, the petitioner continued to advertise on the hoardings in question for the year 2006 -07 also by making payment of Rs. 4,00,000/ - to the second respondent - Department. However, it is the case of the respondents that for the subsequent period from 2007 up to 2011, the petitioner continued to use the hoardings without making any payment and without any permission. Infact, the petitioner had filed O.S. No. 638/2007, in which an order of temporary injunction restraining the second respondent from removing the hoardings was granted by the trial Court, which injunction was operating till 17/08/2011, when the suit was withdrawn. It is also sated that certain interim orders have been granted by this Court in the writ petitions filed by the petitioner. In these circumstances, the second respondent with the assistance of the M.C. and A, assessed the damages to an extent of Rs. 10,68,78,439/ - and demanded that amount from the petitioner by way of the impugned Notice. As the petitioner did not pay up the demand, the impugned notice dated 10/01/2012 was issued to the petitioner, which is assailed in the writ petition. The said notice is issued for recovery of damages by way of arrears of land revenue under the provisions of the Karnataka Land Revenue Act, 1964 (hereinafter, referred to as the "Act").

(3.) AS the basis for assessment of the damages as well as the quantum have been assailed by the petitioner, during the course of submission, learned counsel for the respective parties agreed that the matter ought to have been referred to Arbitration and that a neutral person such as an Arbitrator must assess the damages in accordance with law. However, the fact remains that the petitioner has not surrendered the hoardings to the second respondent - Department. Under these circumstances, for the period from 2007 up to 2011 i.e., for a period of four years, the petitioner has to be directed to pay the second respondent a sum of Rs. 16,00,000/ -, as arrears of rent. This payment shall be without prejudice to either of the parties in the sense that the petitioner can claim refund of any portion of the amount, if he establishes that the hoardings were infact, not put to use during the said period. While the respondents are also entitled to claim damages for this period on the premise that the petitioner has continued to use its hoardings despite the expiry of lease period. Petitioner's counsel states that the petitioner shall pay the amount of Rs. 16,00,000/ - on or before 10/12/2013. In the result, writ petition is disposed of on the following terms: - - 1) Annexure "A" and "J" are quashed. 2) Petitioner shall pay Respondent No. 2, Rs. 16,00,000/ - on or before 10/12/2013, without prejudice to the rights and contentions on both sides, which are kept 'open to be urged before the learned Arbitrator. 3) By consent of parties, the matter is referred to Arbitration Centre - Karnataka, for resolution of the dispute between the parties by way of Arbitration. 4) Hon'ble Justice Sri Ajit J. Gunjal (Retd.), is appointed as the sole Arbitrator by consent of both sides.