GROUP 9 462 – Vasu, 470 – Raj Singh, 490 – S.

Tejaswi, 496 – Sai Chandu SEC G

Coercion

It is the committing or threatening to commit, any act is forbidden by the Indian Penal Code
(45 of 1860) or the unlawful detaining, or threatening to detain, any property, to the prejudice
of any person whatever, to cause any person to agree.

Suit Appeal No. 1032 of 1979

On, 18 April 2001
At, High Court of Delhi
By, THE HONOURABLE MR. JUSTICE A.K. SIKRI

CASE: KISHAN LAL KALRA VS. NDMC, AIR 2001 DEL 402:
The plaintiff, Kishan Lal Kalra claims himself to be a victim of the Emergency era. He was
given license by the NDMC to run an open-air restaurant for five years in Connaught Circus,
New Delhi, in the name of 'Ramble Open Air Restaurant'. The lease was with effect from
01.06.1968 and the rent was Rs.5,104.00 per mensem for the land and Rs. 250.00 per
mensem for car parking space. The land was about 3,000 sq. yards and had a seating capacity
for about 350 persons. After five years, it was renewed with effect from 01.06.1973 for
another period of five years with an increase of rent to Rs.6,380.00 per mensem for land and
Rs. 312.50 per mensem for car parking space. The lease was to expire on 31st May 1978 but
the plaintiff was thrown out of the premises on 7th August 1976 after taking forcible
possession thereof without due process of law by the defendant which sent its demolition
squad with the police force for his purpose. The plaintiff has filed the suit claiming damages
of Rs. 10 lacs suffered apparently by the plaintiff on this account.

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GROUP 9 462 – Vasu, 470 – Raj Singh, 490 – S. Tejaswi, 496 – Sai Chandu SEC G

Issue:

The plaintiff appearing as PW has narrated the incident of 7th August 1976 when the
possession was taken by the defendant from him.

On 7th August 1976 at about 2.00 p.m., the plaintiff was in Hotel Rajdoot, Jangapura, New
Delhi. He received a phone call from the Manager of Ramble restaurant, which was being run
by the plaintiff, that about 15 people from the demolition squad with about 40 policemen had
come to the site along with defendants, officials including the Assistant Secretary, Shri Balbir
Singh and they wanted to demolish the structures and take possession of the premises. The
manager also informed the plaintiff that they have already started demolishing some of the
structures. Then the Plaintiff instructed the manager to request them to wait till he reached
there. He reached the site in about 20-25 minutes and saw that the demolition squad was
demolishing some of the structures. So, he requested Shri Balbir Singh, Assistant Secretary to
hold the demolition till he had met Shri Ailawadi, Secretary of NDMC at that time.
Thereafter the plaintiff went and met Shri Ailawadi and was there for about an hour. Shri
Ailawadi told the plaintiff that he had instructions from Shri Sanjay Gandhi and other higher-
ups and he was helpless in that issue. Shri Ailawadi also told him that he had to sell his entire
furniture, fixtures, and other Installations to Smt. Kaushalya Pahwa and her partner for a sum
of Rs. 90,000/- which would be paid to him by cheque at the site. Shri Ailawadi advised the
plaintiff not to protest and accept the payment, otherwise, instructions had been issued to
arrest him under MISA. By the time he reached back to the site the defendants already had a
possession note typed and a receipt for Rs.90,000/- in favor of Smt. Kaushalya Pahwa. The
plaintiff was forced to sign the possession note under threat that if he did not do so, he would
be arrested and detained under MISA. Likewise, when the plaintiff hesitated in giving away
everything for Rs.90,000/-, a threat was repeated to him as he was shown a blank MISA
warrant signed by the competent authority and was told that his name had to be filled in to
detain him. Under those compelling circumstances, the plaintiff was forced to part with his
entire belongings for a paltry sum of Rs. 90,000/- while he had spent more than Rs.5 lacs on
developing the area and other installation, furniture, fittings, etc.

Facts:

Under Article 352 of the Constitution, an emergency was proclaimed in June 1975 that while
the lease was valid till June 1978, the NDMC on 21st June 1976 initiated eviction
proceedings under Section 4 of the Public Premises (Eviction of Unauthorized Occupants)
Act, 1971 (PP Act).

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GROUP 9 462 – Vasu, 470 – Raj Singh, 490 – S. Tejaswi, 496 – Sai Chandu SEC G

The plaintiff addressed the NDMC intimately on 26 June 1976, explaining his investment and
requesting that it should not be jeopardized. In response to the show-cause notice, the
plaintiff filed a detailed reply with the Estate Officer on 24th July 1976. In the proceeding
before Estate Officer on 3rd August 1976, NDMC requested time to respond to the objection
and hence the matter was adjourned to 22nd September 1976 for evidence from NDMC.

While these proceedings were pending and NDMC was in the process of presenting its
evidence to the Estate Officer, the NDMC took matters into its own hands-on 7th August
1976 and sent a demolition squad with the police to take forcible possession of the premises
without due process of law, disregarding the fact that proceedings had already been initiated
by the NDMC.

At NDMC’s request on 22nd September 1976, the case before Estate Officer was adjourned
to 19th October 1976 and again to 4th December 1976. NDMC's Head Assistant, Mr. P. R.
Gupta, appeared on 13th December 1976 and stated ownership of the premises in question
had been "recovered" from the plaintiff, and that NDMC does not wish to pursue the matter
further and the case was dismissed.

The Proclamation of Emergency was revoked in March 1977. And a statutory notice was
issued on 10th May 1977 by the plaintiff to the NDMC the Punjab Municipal Act, 1911,
however, it was unsuccessful. Plaintiff filed the instant suit in July 1979, seeking to recover
damages for his wrongful deprival and loss of profits for the remaining lease period.

The defendant filed a written statement admitting that proceedings were initiated against the
plaintiff under the provisions of the PP Act. It is also admitted that the defendant licensed
these premises to Smt. Kaushalya Pahwa after removing the plaintiff. However, the defense
of the defendant states that the plaintiff voluntarily surrendered the premises, and therefore,
no suit could be maintained.

However, a receipt dated 7th August 1976 obtained by the defendant by exerting coercion
shows that the plaintiff did not voluntarily surrender the premises to the defendant and none
of the plaintiff's witnesses were cross-examined. The singing of the possession letter was
therefore illegal and had no consequence under Section 15 of the Indian Contract
Act. Accordingly, the issue is decided in favor of the plaintiff.

As a result of the observations, the learned senior counsel asserted that the plaintiff may even
seek restoration of the premises and relied on the pending proceedings under the PP Act
before the Estate Officer. Despite such proceedings, how the plaintiff was coerced into
signing the letter of possession was emphasized.

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GROUP 9 462 – Vasu, 470 – Raj Singh, 490 – S. Tejaswi, 496 – Sai Chandu SEC G

Since the plaintiff argued that he was dispossessed in violation of the law and that the tenure
of the license had not expired, this amounted to a breach of contract, and so he was entitled to
damages. As a consequence of this wrongful dispossession, he has suffered certain definite
calculable damages in the form of a loss on sale of assets, i.e., he was forced to sell the assets
at a price that was much less than their book value, and he has incurred a loss of
Rs.3,28,949/- on this account.

Likewise, the plaintiff was obligated to pay Rs. 1,07,190.81 paisa in retrenchment
compensation for employee termination and Rs.30,715.31 paisa in gratuity to other
employees in the case of premature termination. In addition, the plaintiff was entitled to a
loss of profit for the remaining period of the license. On this account, a sum of Rs. 5 lacs was
claimed based on one week's sales figures duly proved on record.

For this amount to be claimed, it was indicated that the plaintiff had to reasonably assess the
loss and have actual certainty as to what number of damages was not required to be
proven. As already pointed out above, none of the plaintiff's witnesses has been cross-
examined. No evidence has been led by the defendant either. Consequently, the evidence of
the plaintiff remains unconfirmed. In light of this hard reality, the learned counsel for the
defendant did not even attempt to argue that the defendant had lawfully taken possession
from the plaintiff of the dispute premises.

Sh. P.R. Gupta, the defendant's head assistant, appeared on 13th December 1976 and stated
that possession of the premises had been recovered from the plaintiff and for that reason, the
defendant decided not to pursue the matter further.

As evidence for the loss of sale of assets, the plaintiff has provided on record documents
demonstrating that he had invested in furniture and other items. After depreciation, the
investment value is Rs. 6.55 lacs. The plaintiff was forced to sell these assets for a lower
price, and as a result, he incurred a loss of Rs. 3,28,949/-.

In light of the documents on record, it is concluded that the plaintiff has been able to prove
the loss he sustained as a result of the sale of these assets that he was forced to make due to
his illegal eviction. On this account, the plaintiff was entitled to receive Rs.3,28,949/-.

The plaintiff has submitted documents on record showing that he paid Rs. 55,860.81 paise as
retrenchment compensation, Rs. 55,330/- as a gratuity to its workers, and Rs. 30,715.31 paisa
to its other employees when the restaurant closed. Due to the premature termination and
illegal disposition, the plaintiff was obligated to pay retrenchment compensation and other
payments. Therefore, the plaintiff was entitled to recover these amounts.

KISHAN LAL KALRA VS. NDMC Page 4

GROUP 9 462 – Vasu, 470 – Raj Singh, 490 – S. Tejaswi, 496 – Sai Chandu SEC G

The plaintiff has claimed interest from the date of the suit and submitted that the interest from
the date of the suit could be awarded by the court under Section 34 of CPC. The learned
counsel for the defendant did not dispute, rather acknowledged that the court had the
authority to grant interest on the aforesaid damages from the date of suit. Accordingly, the
plaintiff would be entitled to interest at the rate of 12 percent per annum from the date of the
institution of this suit until the judgment is rendered. The plaintiff will also be entitled to 12-
percent future interest on Rs.9,11,525.12 paisa until the payment is made.

Consequently, the suit of the plaintiff is decreed in the sum of Rs.9,11,525.12 paisa with cost
as well as interest at the rate of 12 percent per annum as of the date the complaint was filed to
the date of the decree and future interest at the rate of 12 percent per annum. A decree sheet
was drawn accordingly.

Final Judgment:

The defendant had the burden of proof on this issue. Neither the defendant brought any
evidence or any arguments forward in support of the issue. Thus, the case was decided
against the defendant accordingly.

The court ruled that as the plaintiff had been evicted from the premises where he had been
running an open-air restaurant in a central place in Delhi by threats of arrest and detention
under MISA, the act of the NDMC amounted to coercion.

An out-of-court settlement in the R/O decree passed against NDMC in the case of Sh. Kishan
Lal Kalra, Ex-Allottee, restaurant space at the erstwhile regal park where Palika parking
complex now exists vs. NDMC.

Resolved by the council that proposals as given in the preamble at S. No. 6 & 7 are approved.

Interpretation:
The court has to believe the narration of facts disclosed by the plaintiff that he was forcibly
thrown out of the premises without due process of law in the absence of any cross-
examination of the witnesses or any evidence in rebuttal produced by the defendant.

KISHAN LAL KALRA VS. NDMC Page 5

GROUP 9 462 – Vasu, 470 – Raj Singh, 490 – S. Tejaswi, 496 – Sai Chandu SEC G

In any case, the defendant had no right to terminate the license ahead when the license was
for a particular period that had not expired and expel the plaintiff without due process of law.
It was submitted that the defendant has initiated the proceedings under the provisions of the
PP Act and while those proceedings were pending, the plaintiff was evicted forcibly. This
was unlawful and amounted to a breach of contract.
The learned senior counsel for the plaintiff submitted that based on the judgment of the
Supreme Court in a case, once the PP Act was set into motion, the defendants were entitled to
evict the plaintiff only after following the procedures mentioned in Section 4 of the PP Act
and after allowing the plaintiff by the principles of natural justice. Once the defendant failed
to follow Section 4 of the PP Act and no opportunity to the plaintiff was given, such eviction
was illegal, contrary to law, and also contrary to the principles of natural justice.

It is only after the procedure in this section has been followed, unauthorized occupants can be
evicted under Section 5. In any case, it does not appear that the petitioners were provided
with an opportunity to show cause against the proposed eviction. This is contrary not only to
the law laid down but also to the principles of natural justice. In these circumstances, there is
no option but to allow the petition. If the Authority desired to evict the petitioners from these
premises, it was required to follow the procedure laid out for their action
strictly. Consequently, they grant the petition and order the restoration of the premises to the
petitioners as well as return all the machinery and other goods and parts of their factory that
were seized.

Related Laws:

Section 4 of the PP Act:

Issue of notice to show cause against the order of eviction -

If the estate officer is of opinion that any persons are in unauthorized occupation of any
public premises and that they should be evicted, the estate officer shall issue in the manner
hereinafter provided a notice in writing calling upon all persons concerned to show cause
why an order of eviction should not be made.
The estate officer shall cause the notice to be served by having it affixed on the outer door or
some other conspicuous part of the public premises, and in such other manner as may be
prescribed, whereupon the notice shall be deemed to have been duly given to all persons
concerned. Any magistrate convicting a person under 4[sub-section (2)] may make an order
for evicting that person summarily and he shall be liable to such eviction without prejudice to
any other action that may be taken against him under this Act.

KISHAN LAL KALRA VS. NDMC Page 6

GROUP 9 462 – Vasu, 470 – Raj Singh, 490 – S. Tejaswi, 496 – Sai Chandu SEC G

Section 5 of the PP Act:

Eviction of unauthorized occupants -

If, after considering the cause, if any, shown by any person in pursuance of a notice under
sections 4 and 1[any evidence produced by him in support of the same and after the personal
hearing, if any, given under clause], the estate officer is satisfied that the public premises are
in unauthorized occupation, the estate officer may make an order of eviction, for reasons to
be recorded therein, directing that the public premises shall be vacated, on such date as may
be specified in the order, by all persons who may be in occupation thereof or any part thereof,
and cause a copy of the order to be affixed on the outer door or some other conspicuous part
of the public premises.
If any person refuses or fails to comply with the order of eviction 1[on or before the date
specified in the said order or within fifteen days of the date of its publication under sub-
section (1), whichever is later,] the estate officer or any other officer duly authorized by the
estate officer in this behalf 1[may, after the date so specified or after the expiry of the period
aforesaid, whichever is later, evict that person] from, and take possession of, the public
premises and may, for that purpose, use such force as may be necessary.

Breach of Contract:
It occurs when one party in a binding agreement fails to deliver according to the terms of the
agreement. The parties involved in a breach of contract may resolve the issue among
themselves, or in the court of law.

Section 11 of the PP Act:

Offenses and penalties -
If any person unlawfully occupies any public premises, he shall be punishable with simple
imprisonment for a term which may extend to six months, or with fine which may extend to
five thousand rupees, or with both: Provided that a person who, having been lawfully in
occupation of any public premises by any authority (whether by way of grant, allotment or by
any other mode whatsoever) continues to be in occupation of such premises after such
authority has ceased to be valid, shall not be guilty of such offense.]
If any person who has been evicted from any public premises under this Act again occupies
the premises without authority for such occupation, he shall be punishable with imprisonment
for a term which may extend to one year. or with a fine which may extend to 3[five thousand
rupees], or with both.

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GROUP 9 462 – Vasu, 470 – Raj Singh, 490 – S. Tejaswi, 496 – Sai Chandu SEC G

Section 15 of the Indian Contract Act:

A person is not bound by any act done by him under coercion. The threat of detaining under
MISA was an act of coercion that would fall within the mischief of Section 15 of the Indian
Contract Act. Going by the events which were happening in the Emergency days, it cannot be
ruled out that such a threat would have been given by the defendant to the plaintiff.

Section 34 CPC
Where and in so far as a decree is for the payment of money, the Court may, in the decree,
Order interest at such rate as the Court deems reasonable to be paid on the principal sum
adjudged, from the date of the suit to the date of the decree, in addition to any interest
adjudged on such principal sum for any period before the institution of the suit, 2[with further
interest at such rate not exceeding six percent, per annum as the Court deems reasonable on
such principal sum from] the date of the decree to the date of payment, or such earlier date as
the Court thinks fit.
Where such a decree is silent for the payment of further interest 3[on such principal sum]
from the date of the decree to the date of payment or other earlier dates, the Court shall be
deemed to have refused such interest, and a separate suit, therefore, shall not lie.

Reference:
https://indiankanoon.org/doc/646581/

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