Mere Chance For Occupation Of Premises Via Licence Not Sufficient To Make One Necessary/ Proper Party In Appeal Between Licensor & Licensee: Kerala HC

The Kerala High Court on Friday ruled that a mere possibility of an individual occupying the premises through a licence is not adequate to make them a necessary party or a proper party in an appeal pending between the licensor and the licensee.

Observing so, Justice A. Badharudeen rejected the application filed by the petitioner to get impleaded as an additional respondent in the above appeal. 

"a mere chance for occupation of the premises by way of licence by one party is not a sufficient reason to hold that such a party is either a necessary party or a proper party in an appeal pending between the licensor and the licensee. The rationale is; the presence of the petitioner is not at all required for an effective disposal of the appeal. To put it otherwise, the petitioner is not at all a necessary or proper party in the instant appeal, since an effective order can be made in its absence." 

In an appeal between the respondents herein before the District Court, the petitioner moved an IA to be impleaded as an additional respondent. However, this was rejected citing that the petitioner was not a necessary party as it did not even have a remote or indirect nexus with the lis involved in this case. It was further found that the petitioner was not a proper party since its presence was not required for the final decision of the appeal.

Aggrieved by the finding of the District Judge, the petitioner moved the High Court. 

Advocates C.R. Syamkumar, Sooraj T. Elenjickal, P.A. Mohammed Shah, Aswin Kumar M.J, Renoy Vincent, Helen P.A., Arun Roy and Shahir Showkath Ali appearing for the petitioner argued that they had submitted a tender for the open space currently being illegally occupied by the respondents originally owned by Cochin Port Trust.

They added that the pendency of the impugned appeal was the sole reason for the petitioner not getting the premises yet. Therefore, immediate disposal of the appeal at the interdiction of the petitioner was sought for by impleading it as a party.

It was further highlighted that earnest money to the tune of Rs.8,16,640- also was deposited by the petitioner and it is suffering huge financial losses on account of the pendency of this appeal. 

On the other hand, the respondents filed a counter asserting that the petitioner was neither a necessary nor a proper party and the adjudication of the appeal would in no way affect the interest of the petitioner.

Advocates S.K. Premraj, C. Anilkumar, V. Saritha, K.V. Sudheer, P.M. Manash, Reenu Kurian, Neema Noor Mohamed, Jain Varghese, Navas Jan A, M. Gopikrishnan Nambiar, K John Mathai, Joson Manavalan, Kuryan Thomas, Paulose C. Abraham and Raja Kannan appearing for the respondents submitted that the petitioner was merely waiting for occupying the premises, which, according to the Port Trust, is under illegal occupation of respondents for non-payment of the licence fee.

However, they contended that the licence was irrevocable and the said question required to be decided in the appeal pending before the District Court. They conceded that, if the respondents are dispossessed, the premises may go in occupation of the petitioner.

The pertinent questions that arose before the Court were:

(i) Who is a necessary party in a Suit or appeal or other proceedings?

(ii) Can a party awaiting possession of premises/building having given highest tender, after vacation of the said premises or building by a party being a licensee, be either a proper party or a necessary party in a litigation pending between the licensee and the licensor?

The Court reiterated that a necessary party in a proceeding is one, without whom no order can be made effectively. Similarly, a proper party is one in whose absence, an effective order can be made, but whose presence is necessary for a complete and final decision on the question involved in the proceedings.

In this case, the High Court observed,

"in order that a person may be added as a party to a suit, he should have a direct interest in the subject matter of the litigation whether it raises questions relating to movable or immovable property. That is not the case here as facts ipso facto would establish."

On scrutiny of the materials, the Judge noted that the respondents have been occupying the premises on the basis of a licence.

Cochin Port Trust also submitted that a huge amount is in arrears by way of licence fee and the respondents have been occupying the building without paying the licence fee.

Considering these two facts, the Court deemed it fit to direct for early disposal of the appeal pending before the Additional District Judge-VII, Ernakulam. This was found essential to resolve the grievance of the Port Trust.

In this context, while confirming the order of the District Court, it was also directed to expedite the hearing and disposal of the appeal at the earliest, at any rate, before closing for summer vacation. 

Case Title: Big Movers v. Reeni George & Ors.

Citation: 2022 LiveLaw (Ker) 27

Click Here To Read/Download The Order