Ram Swaroop Rai Vs. Lilavathi [1980] INSC
107 (7 May 1980)
KRISHNAIYER, V.R.
KRISHNAIYER, V.R.
PATHAK, R.S.
CITATION: 1982 AIR 945 1980 SCR (3)1034 1980
SCC (3) 452
CITATOR INFO :
C 1984 SC 87 (20) RF 1988 SC2031 (7) F 1990
SC 897 (8,11,13)
ACT:
U.P. Rent Control Act (Act 13 of 1972),
Section 2(2)- Exemption from application of the provisions of the Act for the
period of ten years in respect of new constructions- Burden of Proof is upon
the landlord and not upon the tenant.
HEADNOTE:
The respondent landlady purchased shop No. 66
in the city of Jhansi in 1969 from one Brij Mohan (DW 2), occupied the first
floor and allowed the appellant/tenant to occupy the ground floor in 1970 on a
lease deed which recited that the building was erected in 1965. In 1975, the
respondent filed the ejection suit on the basis that the building was new, that
the Act did not deter eviction of new constructions put up within ten years of
the suit and so a decree was inevitable. The appellant-tenant resisted the
claim on the plea that the building was constructed 50 years earlier. The Trial
Court negatived the defence and decreed eviction and this was upheld by the
High Court. Hence the appeal by special leave to this Court.
Allowing the appeal and remanding the matter
to the Trial Court, the Court
HELD : 1. In the normal course, no doubt the
appeal must be dismissed as concluded by findings of fact. To avoid possible
public mischief through a new class of litigation for eviction by easy resort
to the "new construction," expedient, interference under Article 136
of the Constitution is necessary. [1037 A-B] 2.Section 2(2) of the U.P. Act,
uses the phrase "nothing in the rent control legislation shall apply to a
building" during a period of ten years from the date on which its
construction is completed. In other words, in regard to all buildings the Act
applies save where this exemption operates. Therefore the landlord who seeks
exemption must prove that exception. The burden is on him to make out that
notwithstanding the rent control legislation, his building is out of its ambit.
It is not for the tenant to prove that the building has been constructed beyond
a period of ten years, but it is for the landlady to make out that the
construction has been completed within ten years of the suit. This is sensible
not merely because the statute expressly states so and the setting
unnecessarily implies so, but also because it is the landlady who knows best
when the building was completed, and not the tenant. As between the two, the
owner of the building must tell the court when the building was constructed,
and not the tenant thereof.
Speaking generally, it is fair that the onus
of establishing the date of construction of the building is squarely laid on
the landlord although in a small category of cases where the landlord is a
purchaser from another, he will have to depend on his assignor to prove the
fact. [1038 C-F] 3. An analysis of Explanation 1 to s. 2(2) of the U.P. Act
indicates:
(1) Where a building has not been assessed,
it is the date on which the completion was reported to, or otherwise recorded
by the local authority having jurisdiction. [1038 G-H] 1035 (2) Where a
building has been assessed, it is the date on which the first assessment comes
into effect.
Provided that if the date on which the
completion was reported, to, or otherwise recorded by, the local authority is
earlier than the date of the first assessment, the date of completion will be
such earlier date.
[1039 A-B] (3) Where there is no report,
record or assessment, it is the date of actual occupation for the first time
(not being an occupation for the purpose of supervising the construction or
guarding the building under construction). [1039 B-C] Unfortunately, it is not
possible for the purchaser- respondent or the tenant-appellant to give direct
testimony about the time of the construction or the nature of the construction
vis-a-vis Explanation (b) or (c). The best testimony is the municipal records
about the completion of the building and the verification by the municipal
authorities as to whether a new construction has come into being or an old
construction has been remodelled and, if so, when exactly the completion took
effect. It is quite conceivable that the municipal records bearing on the
completion of the construction may throw conclusive light, whatever might have
been the original proposal in the plan submitted. It is perfectly possible that
on a view of the earlier construction, vis a vis the completed new building the
former may form but a small part. It may also be that the implication of the
expression "increased assessment" may be explained with reference to
earlier assessment records in the municipality. Moreover, whenever a new
building is completed, a report has statutorily to be made and only on a
completion survey and certificate, occupation is ordinarily permitted. These
records must also be available in the office of the local authority. The
statute makes it clear that reliance upon the municipal records rather than on
the lips of witnesses is indicated to determine the date of completion and the
nature of the construction. This statutory guideline has been wholly overlooked
and the burden lying on the landlord has not been appreciated. The result is
that the eviction order has to be demolished.
[1039 F-G, 1040 D-G] In the instant case (i)
the Municipal assessment record produced in the Court merely states
"increased assessment".
It may suggest the existence of an assessment
which has been increased or it may perhaps be argued that when the building was
reconstructed a new assessment was made which was more than the previous
assessment and, therefore, was described as increased assessment; (ii) the oral
evidence is inconsequential being second hand testimony. Even the recital in
the rent deed that there was a new construction in 1965-66 is by the appellant
and the respondent, neither of whom has any direct knowledge about the
construction. Of course, an admission by the appellant is evidence against him
but an admission is not always conclusive especially in the light of the
municipal records such as are available and the burden such as has been laid by
the statute; and (iii) the failure of the trial Court specifically to record
when the building was completed and what was the extent of rebuilding, whether
it was a case of total demolition and reconstruction or such extensive
additions as to push the existing building into a minor part, becomes fatal.
These basic issues have failed to receive any attention from the courts below.
A finding recorded on speculative basis is no finding and that is the fate of
the holding. [1039 G-H, 1040 A-D] 1036
CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 2109 of 1979.
Appeal by Special Leave from the Judgment and
Order dated 7-5-1979 of the Allahabad High Court in Civil Revision No. 900 of
1978.
A.K. Sen, B.S. Banerjee and R.N. Govind for
the Appellant.
J.P. Goyal and S.K. Jain for Respondent.
The Judgment of the Court was delivered by
KRISHNA IYER, J.-A brief back-drop leads to the short point in issue. Chronic
scarcity of accommodation in almost every part of the country has made
'eviction' litigation explosively considerable, and the strict protection
against ejectment, save upon restricted grounds, has become the policy of the
State. Rent Control Legislation to give effect to this policy exists
everywhere, and we are concerned with one such in the State of U.P. (U.P. Act
13 of 1972). The legislature found that rent control law had a chilling effect
on new building construction, and so, to encourage more building operations,
amended the statute to release, from the shackles of legislative restriction,
'new constructions' for a period of ten years. So much so, a landlord who had
let out his new building could recover possession without impediment if he
instituted such proceeding within ten years of completion. The respondent is a
landlady who claims to fill the bill in this setting and seeks to evict the
appellant-tenant untrammeled by the provisions of the Act. She has succeeded in
both the courts below and the appellant challenges the order as illegal and
vitiated by a basic error of approach.
We should have made short work of it had
there not been the need for this Court to set the sights right in the class, of
litigation where exemption from the operation of the Act is claimed on the
ground that the construction is new and the case is filed within the ten-year
moratorium. If the exemption is erroneously liberalised to frustrate the
principal measure by failure to stick to basic legal principles, the jurisprudence
of rent control may become too jejune to be socially effective. That is why we
examine a few fundamentals here in the decisional process of this class of
cases.
The area of controversy, factual and legal,
is small.
The respondent purchased shop No. 66 in the
city of Jhansi in 1969 from one Brij Mohan (DW2), occupied the first floor and
allowed the appellant, as tenant, to occupy the ground floor in 1970 on a lease
deed which recited that the building was erected in 1965. In 1975 the present
eviction action was instituted on the basis that the building was new, that the
Act did not debar eviction of new constructions put up within ten years of the
suit and so a decree was inevitable.
1037 The tenant resisted the claim on the
plea that the building was constructed 50 years ago. The trial court negatived
the defence and decreed eviction and this was upheld by the High Court.
If it were a bare finding of fact we should
not have reopened it, but Shri A.K. Sen argues that fundamental flaws in the
understanding of the law have vitiated the decision which, if left uncorrected,
will spell a new class of litigation for eviction by easy resort to the 'new
construction expedient. Such possible public mischief persuades us to have a
closer look at the Act to the extent relevant.
Shri J.P. Goel rightly reminds us that in the
normal course the appeal must be dismissed as concluded by findings of fact.
But we will probe the matter further to explore whether there is any substance
in Shri A.K. Sen's argument of fundamental failure bearing on the legality of
the conclusions. The anatomy of the Act is substantially the same as that of
other similar legislations. The most important feature we have to notice is the
exemption from application of the provisions of the Act for the period of ten
years in respect of new constructions. Section 2(2) is relevant in this context
and runs as follows:
Except as provided in sub-section (5) of
section 12 sub-section (1A) of section 21, sub-section (2) of section 24,
sections 24A, 24B, 24C or sub-section (3) of section 29, nothing in this Act
shall apply to a building during a period of ten years from the date on which
its construction is completed.
xxx xxx xxx Explanation I.-For the purposes
of this sub- section, (a) The construction of a building shall be deemed to
have been completed on the date on which the completion thereof is reported to
or otherwise recorded by the local authority having jurisdiction, and in the
case of a building subject to assessment, the date on which the first
assessment thereof comes into effect, and where the said dates are different,
the earliest of the said dates, and in the absence of any such report, record
or assessment, the date on which it is actually occupied (not including
occupation merely for the purposes of supervising the construction or guarding
the building under construction) for the first time:
Provided that there may be different dates of
completion of construction in respect of different parts of a building which
are either designed as separate units or are occupied 1038 separately by the
landlord and one or more tenants or by different tenants.
(b) 'construction' includes any new
constructions in place of an existing building which has been wholly or
substantially demolished;
(c) Where such substantial addition is made
to an existing building, that the existing building becomes only a minor part
thereof, the whole of the building including the existing building shall be
deemed to be constructed on the date of completion of the said addition.
This sub-section and its construction is
decisive of the fate of the appeal. Nothing in the rent control legislation
shall apply to a building "during a period of ten years from the date on
which its construction is completed." The first thing that falls to be
emphasised is that in regard to all buildings the Act applies save where this
exemption operates. Therefore, the landlord who seeks exemption must prove that
exception. The burden is on him to make out that notwithstanding the rent
control legislation, his building is out of its ambit. It is not for the tenant
to prove that the building has been constructed beyond a period of ten years.
But it is for the landlady to make out that the construction has been completed
within ten years of the suit. This is sensible not merely because the statute
expressly states so and the setting necessarily implies so, but also because it
is the landlady who knows best when the building was completed, and not the
tenant. As between the two, the owner of the building must tell the court when
the building was constructed, and not the tenant thereof.
Speaking generally, it is fair that the onus
of establishing the date of construction of the building is squarely laid on
the landlord, although in a small category of cases where the landlord is a
purchaser from another, he will have to depend on his assignor to prove the
fact.
Firstly, therefore, we must examine whether
the respondent has made out her case for exemption from the operation of the
Act based on the vital fact that the building has been completed only within
ten years of the suit. The second thing we have to remember is Explanation 1
quoted above. When is a building deemed to have been completed? An analysis of
Explanation 1 to s.2(2) of the U.P. Act indicates:
(1) Where a building has not been assessed,
it is the date on which the completion was reported to, or other wise recorded
by the local authority having jurisdiction.
1039 (2) Where a building has been assessed,
it is the date on which the first assessment comes into effect.
Provided that if the date on which the
completion was reported to, or otherwise recorded by, the local authority is
earlier than the date of the first assessment, the date of completion will be
such earlier date.
(3) Where there is no report, record or
assessment, it is the date of actual occupation for the first time (not being
an occupation for the purpose of supervising the construction or guarding the
building under construction ).
It is common case that Shop Nos. 65 and 66 were
owned by a common owner, Shri Brij Mohan, DW2. He sold only Shop No. 66 to the
respondent. So, there is no doubt, that there was an existing building, Shop
No. 66, long prior to the ten-year period mentioned in the statute. According
to the testimony of Shri Brij Mohan, DW2, the old construction continued, but
certain additions and remodelling were done.
He had submitted a plan to the local
authority indicating the original construction and the proposed additions, and
that is marked as Exhibit in the case. This shows the existence of a prior
building, the proposal being for addition or partial reconstruction and not for
total demolition. If we go by the plan, it is not possible to conclude
automatically that there is a new construction. If we go by Brij Mohan's
evidence, the owner of the building at the relevant time, we cannot necessarily
hold that the existing building has been substantially demolished and
reconstructed. Indeed, his evidence is to the effect that the construction such
as was made was beyond the 10 year period.
Unfortunately, it is not possible for the
purchaser- respondent or the tenant-appellant to give direct testimony about
the time of the construction or the nature of the construction vis-a-vis
Explanation (b) or (c). The best testimony is the municipal records about the
completion of the building and the verification by the municipal authorities as
to whether a new construction has come into being or an old construction has
been remodelled and, if so, when exactly the completion took effect. The
municipal assessment record produced in the court merely state "increased
assessment". It may suggest the existence of an assessment which has been
increased or it may perhaps be argued that when the building was reconstructed
a new assessment was made which was more than the previous assessment and,
therefore, 1040 was described as increased assessment. The oral evidence in the
case, apart from what we have set out, is inconsequential, being second hand
testimony. Even the recital in the rent deed that there was a new construction
is 1965-66 is by the appellant and the respondent, neither of whom has any
direct knowledge about the construction. Of course, an admission by the
appellant is evidence against him but an admission is not always conclusive
especially in the light of the municipal records such as are available and the
burden such as has been laid by the statute.
Viewed in this perspective, the failure of
the trial court specifically to record when the building was completed and what
was the extent of re-building, whether it was a case of total demolition and
reconstruction or such extensive additions as to push the existing building
into a minor part, becomes fatal. These basic issues have failed to receive any
attention from the courts below. A finding recorded on speculative basis is no
finding and that is the fate of the holding in the present case.
We do not want to dwell on the evidence in
greater detail because we propose to remit the case to the trial court (Court
of the First Additional District Judge, Jhansi). It is quite conceivable that
the municipal records bearing on the completion of the construction may throw
conclusive light, whatever might have been the original proposal in the plan
submitted. It is perfectly possible that on a view of the earlier construction,
vis a vis the completed new building, the former may form but a small part. It
may also be that the implication of the expression "increased
assessment" may be explained with reference to earlier assessment records
in the municipality. Moreover, whenever a new building is completed, a report
has statutorily to be made and only on a completion survey and certificate,
occupation is ordinarily permitted. These records must also be available in the
office of the local authority. The statute makes it clear that reliance upon
the municipal records, rather than on the lips of witnesses, is indicated to
determine the date of completion and the nature of the construction. This
statutory guideline has been wholly overlooked and the burden lying on the
landlord has not been appreciated. The result is that the eviction order has to
be demolished.
It may still be open to the
landlady-respondent to make out his case by producing better municipal evidence
in the light of what we have indicated. We do not wish to deny the landlady
this opportunity because the trial court has not approached the problem from
the correct legal angle. We set aside the judgment of the courts below and
remit the case for hearing to the trial court. The trial court 1041 will give
an opportunity to both sides to adduce fresh evidence, documentary and oral, to
make out the ground of exemption from the application of the Act. Of course,
when the entire evidence is before the court, the onus of proof will play a
lesser role.
Before parting with the case, we wish to
notice a submission made by Shri Goel that the landlady's son was an unemployed
engineer who needed the premises for personal requirement. Even if the Act
applies, it is open to the landlady to make out any of the grounds under the
Act for eviction. To avoid prolixity and delay of the proceedings, we permit
the trial court to allow the landlady, if she applies in that behalf, to plead
on an alternative basis, for eviction on any of the specified grounds under the
Act.
The appeal is allowed and the case remitted
to the Court of the Addl. District Judge, Jhansi for fresh disposal in the
light of the observations made above.
S.R. Appeal allowed.
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