Dr. A.K.Jayasankaran Nambiar, J.

1. This set of eight writ appeals – four [W.A.Nos.751 of 2018, 763 of 2018, 775 of 2018 and 836 of 2018] filed on behalf of the Board of Trustees, Cochin Port Trust and the other four [W.A.Nos.2782 of 2025, 2817 of 2025, 2887 of 2025 and 3027 of 2025] filed by the Cochin Port Lease Holders' Association, Cochin Custom House Agents' Association, Indian Chamber of Commerce and Industry and M/s.Forbes Ewart & Figgis Private Limited respectively, impugn a common judgment dated 24.01.2018 of a learned Single Judge in W.P.(C).Nos.16851 of 2014, 32292 of 2014, 32299 of 2014 and 32305 of 2014.

2. The brief facts necessary for disposal of these Writ Appeals are as follows:

The appellants in W.A.Nos.2782 of 2025, 2817 of 2025, 2887 of 2025 and 3027 of 2025, who had filed the writ petitions aforementioned, had taken various extents of land on long term lease from the Cochin Port Trust. Apart from the usual clauses to be found in such agreements, the lease agreements entered into with the appellants contained a clause that permitted them to sublease portions of the demised premises to third parties, provided the sublease was for purposes similar to those for which the main lease was granted.  Clause 3 (a) and 3 (b) of the lease agreement entered into between the Cochin Port Trust and the appellants/writ petitioners read as follows:

             ➢ 3.

                  a) The Lessee shall not assign transfer or underlet the demised land or the building(s) structure(s) erected or to be erected thereon or any part thereof without the consent in writing of the Lessor. Upon assignment transfer or sub-lease of the land demised or any part thereof or of the building to be erected thereon or any part thereof with the consent of the Lessor in writing and at any rate within one month of the date of such assignment transfer or sublease the Lessee shall deliver a notice of such assignment transfer or sub-lease to the Lessor setting forth the names and descriptions of the parties thereto and particulars and effect thereof.

                  b) The Lessee shall be liable to pay such charges, fees or levy as are prescribed from time to time on account of such assignment, transfer or sub-lease as the case may be. In the event of the Lessee effecting any such sub-lease, without the prior consent in writing of the Lessor for the same, it shall be open to the Lessor to approve of the same if a request therefore is made, provided, the Lessee pays the Lessor during the subsistence of such unauthorised assignment, transfer or sub-lease additional amount as detailed below:

                  i) Where consent has already been granted by the Lessor for the sub-lease as above, and the delay is only in respect of the submission of the application for renewal of the same, the amount payable in the case of delay not exceeding two months, shall be equivalent to interest at 20% of the levy payable in respect of the sub-lease levy for the period of such delay and where it exceeds 2 months, at 40% of Sub-lease levy for the total period of such delay.

                  ii) In the case of unauthorized sub-lease, the Lessee shall be liable to pay a penalty at the rate of three times the sub-lease levy.

                  Provided, however, that the Lessor, if it is satisfied at its absolute discretion that such delay in filing the application for consent or renewal of consent for such sub-lease was for circumstances beyond the control of the Lessee, the Lessor may grant remission of a portion of the amount payable as above.

3. As is evident from a perusal of the aforementioned clauses, the appellants/writ petitioners as the 'original lessees' were obligated to pay to the Cochin Port Trust “such charges, fees or levies as are prescribed from time to time on account of subleases entered into by them with third parties.” It would appear that while the appellants/writ petitioners were paying the necessary charges to Cochin Port Trust based on the rates then fixed by the latter, a demand was raised by the Cochin Port Trust for higher fees for subletting which was quantified at 50% of the rent charged by the appellants/writ petitioners from their sub-lessees. The demand by the Cochin Port Trust was apparently consequent to the implementation in the Cochin Port Trust of the Policy Guidelines for Land Management by Major Ports, 2014 [hereinafter referred to as the “LPG 2014”] which were in fact directions received from the Central Government under Section 111 of the Major Port Trusts Act, 1963.

4. The appellants/writ petitioners contended that the LPG 2014, and the higher fees on sub-letting, could not be enforced against them because they were existing lessees, who had already entered into sub-lease agreements with sub-lessees, whereas LPG 2014 was to apply only in respect of fresh sub-lease agreements that were entered into subsequent to the publication of the LPG 2014. It was their further contention that, at any rate, the higher rate of subletting fee prescribed under the LPG 2014 could not be demanded from them since the said rate was not authorised by the Tariff Authority for Major Port [TAMP] as envisaged under the Major Port Trusts Act.

5. The learned Single Judge, who considered the writ petitions, found force in the contention of the learned counsel for the appellants/writ petitioners that the provisions of Section 49 of the Major Port Trusts Act, 1963, clearly indicated that the authority to fix the scale of rates, as well as the conditions under which any property, including buildings thereon, could be let out by the Board, was the TAMP constituted under Section 47A of the Major Port Trusts Act. The learned Single Judge therefore found that in so far as in the instant cases, there was no such notification by the TAMP, the provisions of the LPG 2014 could not be relied upon by the Cochin Port Trust to demand enhanced fee for subletting from the appellants/writ petitioners.

6. In W.A.Nos.751 of 2018, 763 of 2018, 775 of 2018 and 836 of 2018 preferred at the instance of the Board of Trustees of the Cochin Port Trust, the contention raised by Sri.Joseph Markos, the learned senior counsel, assisted by Sri.V.Abraham Markos, the learned counsel, is that the findings of the learned Single Judge in the impugned judgment are factually and legally erroneous. It is, in particular, pointed out that the LPG 2014 was issued by the Central Government pursuant to the powers under Section 111 of the Major Port Trusts Act, which provision reads as under:

                  “111. Power of Central Government to issue directions to Board-

                  (1) Without prejudice to the foregoing provisions of this Chapter, the Authority and every Board shall, in the discharge of its functions under this Act, be bound by such directions on questions of policy as the Central Government may give in writing from time to time:

                  Provided that the Authority or the Board as the case may be, shall be given opportunity to express its views before any direction is given under this sub-section.

                  (2) The decision of the Central Government whether a question is one of policy or not shall be final.”

                  He would further point out that since the LPG 2014 was communicated to the Major Ports by the Central Government in writing, and there was no ambiguity as regards the directions being on questions of policy, the Cochin Port Trust, in its capacity as the lessor of the premises, was bound by the terms of the LPG 2014. Similarly, by virtue of clause 2(k) of the lease agreement entered into between the Cochin Port Trust and the appellants/writ petitioners, the lease stood governed by the provisions of the Major Port Trusts Act, Indian Ports Act, 1908 and all directives issued by the Government of India from time to time. The clause thus made the directives binding upon the lessee as well, and the lessee too was obliged to comply with all such directives that were issued by the Government of India and communicated to it by the lessor. It was contended, therefore, that it was not open to the appellants/writ petitioners to contend that the higher subletting fee could not be demanded from them merely because there was no order passed by the TAMP under Section 49 of the Major Port Trusts Act.

7. Per contra, it is the submission of Ms. Anagha Lakshmy Raman, the learned counsel for the writ petitioners, that even assuming that the LPG 2014 formed part of the lease agreement entered into between them and the Cochin Port Trust, the express terms of the LPG 2014 clarified that it would apply only to newly created sublease, whether they were created under existing leases or new leases. The contention of the learned counsel, in other words, is that, while clause 12 of the LPG 2014 makes it clear that the policy guidelines would apply to existing and new leases, clause 12B makes it clear that the Guidelines would apply only to new sub-leases created under such leases, after the coming into force of LPG 2014. She draws our attention to clause 12B of the LPG 2014, which reads as under:

                  “12. General- Applicable to existing and new leases:

                  B. Subletting :The existing lease holder may be allowed to sublet/partially sublet the leased premises to another party for the same purpose for which it was originally allotted. Also, such subletting shall be in accordance with the Land Use Plan and before allowing this, the Port shall recover 50% of the rent charged by the lessee from the sub-lessee for the entire period of sub-lease irrespective of the fact whether land was originally allotted on upfront basis or annual rental basis. It is clarified that the original lessee would continue to remain responsible for payment of lease rent and for adherence to the terms and conditions of lease. However, in respect of leases which shall be entered into after the coming into effect of these guidelines, in cases where, the lessee is not able to utilize the entire land leased to him, the portion of the lease premises not required by him should be surrendered and no subletting shall be permitted. Port Trust shall refund proportionate lease rental when allotted on upfront premium basis. It is further clarified that leased premises also includes structures built on lease land for the purpose of recovering of subletting fee. Exemption from collecting subletting fee may be given in case of FTZ/SEZ wherein the business model is based on subletting only.” (emphasis supplied)

8. On a consideration of the rival submissions, we find ourselves in agreement with the contention of the learned counsel for the writ petitioners [appellants in W.A.Nos.2782 of 2025, 2817 of 2025, 2887 of 2025 and 3027 of 2025] who have impugned the judgment of the learned Single Judge to the extent it did not consider their contention with regard to the applicability of LPG 2014 to existing sub-leases. No doubt, there was no notification issued by the TAMP in terms of Section 49 of the Major Port Trusts Act, prescribing the fee for subletting which could be collected by the Cochin Port Trust, and further, LPG 2014 issued by the Central Government in exercise of its powers under Section 111 of the Major Port Trusts Act was expressly made binding on the lessees by virtue of clause 2(k) of the lease agreement. The writ petitioners - lessees could not therefore be heard to say that the terms of LPG 2014 would not govern their leases. However, LPG 2014 did not envisage a situation where the higher fee for subletting would be charged even from those lessees who had already entered into sublease agreements prior to the issuance of LPG 2014 by the Central Government.

9. On the facts of the instant cases, we find that the sublease agreements entered into between the writ petitioners and their sub-lessees were much prior to 2014, and LPG 2014 makes it clear that the provision for the charge of higher fee for subletting applies only in the case of sub-leases created after the coming into force of the Policy Guidelines, be it under existing leases or fresh leases. This aspect can be gathered from the terms of LPG 2014 itself which mandate that the lessor – Cochin Port Trust shall levy the higher fee and collect the same from the lessee prior to permitting the sub-lease in terms of the original lease agreement. We therefore find that the conclusion of the learned Single Judge in the impugned judgment that the higher fee for subletting could not be charged from the writ petitioners, albeit not sustainable for the reasons stated by the learned Single Judge is nevertheless one that independently  flows  from  an  interpretation  of  the  parent  lease agreement which implicitly incorporates LPG 2014 therein. We therefore uphold the finding of the learned Single Judge for the reasons stated in this judgment.

10. For the sake of clarity, we might re-iterate that we are not in agreement with the finding of the learned Single Judge that in the absence of any notification by the TAMP under Section 49 of the Major Port Trusts Act, there cannot be a levy of higher fee for subletting by the Cochin Port Trust. In our view, the fact that the Policy Guidelines trace their origin to directions issued by the Central Government under Section 111 of the Major Port Trusts Act, read with the fact that the LPG 2014 formed an integral part of the parent lease agreement entered into between the Cochin Port Trust and the writ petitioners, would together suffice to make the provisions of LPG 2014 applicable to the lessees and new sub-lessees contemplated therein.

In the result, the Writ Appeals are partly allowed to the extent indicated in this judgment, and the impugned judgment of the learned Single Judge modified to such extent.