Authority: High Court of Judicature at Bombay

Order Date: 21 October 2026

Case Overview

  • Parties: Brihan Mumbai Electric Supply & Transport Undertaking (BEST) (Petitioner) vs. Life Insurance Corporation of India (LIC) and the Estate Officer (Respondents).
  • Nature of dispute: Eviction and claim for damage rent under the Public Premises (Eviction of Unauthorised Occupants) Act, 1971 concerning a 412 sq m plot in Village‑Eksar, Borivali (Survey No.102, CTS Nos.1339 & 1340).
  • Lease background: Lease deed executed on 12 December 1989 for 30 years commencing 24 Nov 1977, with a renewal clause allowing a further 30‑year term on the same terms if notice given three months before expiry. Lease expired on 23 Nov 2007.
  • Renewal attempt: BEST sent renewal notice on 13 April 2007; LIC gave no response. LIC finally refused renewal on 28 August 2013, citing non‑use of the land.
  • Termination: LIC issued termination notice on 21 September 2013, demanding possession. BEST failed to vacate, leading to eviction proceedings.
  • Estate Officer order: Dated 31 July 2015, directing eviction under Section 5(1) of the PP Act and payment of damage rent of Rs 1,26,597 per month with interest, amounting to Rs 27,31,330.28 for the period 1 Dec 2013 to 31 July 2015.
  • Appeals: BEST appealed (Appeal No.43 of 2015) before the City Civil Court. The Court dismissed the appeal on 20 June 2016, confirming eviction and damages. BEST returned possession on 20 July 2016 after interim relief lapsed and again on 27 October 2016.
  • Legal arguments: BEST argued the lease entitled automatic renewal for another 30 years and that termination was illegal; cited State of UP v. Lalji Tandon. LIC contended renewal required its consent and cited Hardesh Ores (P) Ltd. and Bharat Petroleum Corp. v. Vaidya, emphasizing non‑use of the land and BEST’s willingness to surrender.
  • Court reasoning: The Court noted the renewal clause required LIC’s consent and that no renewal was executed. BEST had kept the plot vacant for over 35 years, showed willingness to surrender (letter dated 13 April 2012), and the land was needed for LIC staff housing. The Court found no automatic right to renewal and upheld eviction.
  • Damage rent assessment: The Court considered the nominal rent of Rs 1 per year, BEST’s severe financial crisis, and the fact that BEST derived no benefit from the land. It deemed the damage rent award excessive and unjust enrichment for LIC.

Final Outcome

  • The eviction order is upheld; BEST must vacate the plot.
  • The direction to pay damage rent of Rs 1,26,597 per month and the accrued interest (total Rs 27,31,330.28) is set aside.
  • BEST is not liable to pay any damage rent or interest to LIC.
  • No order as to costs.

Topics: Lease Dispute, Eviction, Damage Rent