K.S. Sunderaraju
Chettiar Vs. M.R. Ramachandra Naidu [1994] INSC 131 (18 February 1994)
Ray,
G.N. (J) Ray, G.N. (J) Reddy, K. Jayachandra (J)
CITATION:
1994 AIR 2129 1994 SCC (5) 14 JT 1994 (1) 679 1994 SCALE (1)665
ACT:
HEAD NOTE:
The
Judgment of the Court was delivered by G.N. RAY, J.- Leave granted. Pursuant to
the notice issued on the Special Leave Petition No. 1687 of 1993, the
respondent has entered appearance through counsel and the counter-affidavit has
also been filed.
2. The
appellant landlord is the owner of the suit premises being Shop No. 142, Gandhiji Road, Mayiladuthurai, Tamil Nadu. On
15-6-1971, the appellant landlord leased out the premises in question to Shri
G. Vasanthan on a monthly rental of Rs 400 with effect from 15-6-1971 and the
appellant landlord sought eviction of the said tenant Vasanthan and filed a
petition for eviction on 22-4-1975 under Section 14(1)(b) of the Tamil Nadu
Building (Lease and Rent Control) Act, 1960 (hereinafter referred to as the
Rent Act) before the Rent Controller Mayiladuthurai. By an order dated 12-12-1975, the learned Rent Controller dismissed the said
eviction proceeding being RCOP No. 9 of 1975. The appellant landlord preferred
an appeal against the said order of the Rent Controller before the appellant
authority.
By
order dated 31-8-1977, the appellant authority allowed
the said appeal and directed the eviction of the said tenant Vasanthan.
Thereafter, the appellant landlord on 29-8-1978, let out the suit premises to the
respondent M.R. Ramachandra Naidu for a period of three years from 1-8-1978 to 31-8-1981 on a
rental of Rs 750 per month. The period of lease was extended further for
another term of three years with effect from 1-9-1981 to 31-8-1984. It is the case of the landlord
that he required the suit premises for expansion of his own business and also
the pawn broking business under the partnership of his wife and
daughter-in-law. The appellant landlord served a notice dated 5-11-1984 upon the respondent tenant asking him to vacate the
suit premises. The respondent tenant refused to vacate the suit premises and on
17-4-1985, the appellant landlord filed an
eviction petition under Section 10(3)(a)(iii) of the Rent Act for eviction of
the tenant on the ground that the appellant landlord required more space for
running the said pawn broking shop as well as the business of his own. The
appellant landlord also urges that since the suit premises were old and in a
dilapidated condition the same required urgent demolition and construction and
accordingly the tenant should also be evicted under Section 14(1)(b) of the
Rent Act. By an order dated 5-10-1987, the
learned Rent Controller allowed the said RCOP No. 37 of 1985 on the ground that
the appellant landlord had made out a case under Section 10(3)(a)(iii) of the
Rent Act and he required the suit premises bona fide for his own occupation.
The Rent Controller, however, negatived the case of the appellant landlord that
he required the premises for demolition or construction under Section 14(1)(b)
of the Rent Act. The respondent tenant thereafter filed RCA No. 4 of 1988 dated
26-4-1989. The appellant landlord also filed
Cross Appeal being RCA No. 9 of 1988 against the dismissal of 19 the appellant
landlord's case for eviction under Section 14(1)(b) of the Rent Act. By a
judgment and order dated 26- 4-1988, the appellate authority dismissed RCA No.
4 of 1988 filed by the respondent tenant after endorsing the finding of the
learned Rent Controller that the suit premises was bona fide required by the
appellant landlord for his use and occupation. The learned appellate authority,
however, dismissed the landlord's Cross Appeal being RCA No. 9 of 1988 by the
same judgment. The respondent tenant thereafter filed Civil Revision Petition
No. 1448 of 1989 in the High Court of Madras challenging the said eviction
order under Section 10(3)(a)(iii) of the Rent Act. By an order dated 11-4-1990, the said Civil Revision Petition No. 1448 of 1989
was allowed by the High Court of Madras and the case was remanded to the
appellate authority inter alia directing the appellate authority to dispose of
the case afresh in accordance with law and ill terms of the directions
contained in the said order. Thereafter, pursuant to the liberty granted by the
High Court to both the parties to adduce further evidence before the appellate
authority, fresh evidences both oral or documentary were adduced before the
appellate authority. The appellate authority by a judgment and order dated
14-12-1990, dismissed the said RCA No. 4 of 1988 filed by the respondent tenant
and confirmed the order of eviction passed by the learned Rent Controller.
The
respondent tenant thereafter filed a Civil Revision Petition being Civil
Revision Petition No. 436 of 1991 in February 199 1.
3. The
said civil revision petition was allowed by the High Court by its order dated 11-12-1992 inter alia on the finding that the appellate
authority had not decided the appeal after remand in conformity with the order
of remand dated 11-4-1990 passed by the High Court. The
appeal was remanded for the second time by the High Court before the appellate
authority by directing inter alia that the said appeal should be disposed of by
following the directions contained in the order of remand dated 11-4-1990. It is this second order of remand dated 11-12-1992 which has been challenged in the instant appeal by
the appellant landlord.
4.
Since the impugned second order of remand has been passed by the High Court
inter alia on the finding that the appellate authority failed to dispose of the
appeal in accordance with the directions contained in the earlier order of
remand, it is necessary to advert to the observations made in the first order
of remand in order to appreciate as to whether or not the appellate authority
has failed to dispose of the appeal properly in accordance with the directions
contained in the order of remand.
5. The
High Court had noted in the first order of remand that in the notice for
eviction the landlord stated about the requirement of the disputed premises on
account of expanding his own business but in the eviction petition, the case
for bona fide requirement of the landlord was founded not only for the
requirement for expansion of his own business but also for the expansion the
pawn broking business of the wife and daughter-in-law of the landlord and also
for demolition and construction of the suit premises.
The
High Court observed that the landlord was not consistent with reference to 20
the location of Govindammal and Company which was the pawn broking business in
partnership of the wife and daughter-in- law of the landlord. The High Court
also observed that it was not clear as to what exactly was the area that was
required by the respondent for the said pawn broking business in jewellery
which was purely a business of advancing money on the security of jewels. The
High Court also observed that the appellate authority came to the finding that
the said partnership business had expanded by looking at Exts. A-10, A-11 and
A-12 but the High Court was of the view that in the absence of sufficient
materials right from the date of the commencement of the business, it was not
possible to make any finding about the improvement of the said business. The
High Court also observed that even if the business had improved, the very nature
of the business that the pledged jewels had to be secured either in the locker
in the iron safe or in the bank, the requirement of a very large area for such
business might not be bona fide. It was, therefore, necessary to determine
whether the landlord required the suit premises after keeping in mind the
nature of the said partnership business and the area already under the
possession of the landlord. The High Court also observed that the trial court
and the appellate authority did not accept the case for eviction on the ground
of demolition and reconstruction. But even for the purpose of deciding bona
fide requirement of the landlord, the entire circumstances under which the
landlord had instituted the proceedings were required to be taken into account.
Referring
to a decision of this Court in Hameeda Hardware Stores v. B. Mohan Lal Sowcarl
the High Court observed that it was clear from the said decision that when a
landlord had sought eviction of a tenant from the non-residential premises
under Section 10(3)(a)(iii) of the Act, the landlord was required to establish
other ingredients referred to in the said judgment. It was held by the High
Court that as the appellate authority had failed to consider not only the
totality and (sic of) circumstances and the facts of the case but also the bona
fide on the part of the landlord in seeking eviction from the demised premises
on account of alleged requirement of the said partnership business, the
impugned order of the appellate authority was vitiated. The High Court,
therefore, held in the order of first remand that :
"It
is in these circumstances, the order of the appellate authority is set aside
and the matter is remitted back to the appellate authority to consider the
totality of the facts and circumstances of the case and the bona fide on the
part of the respondent's requirement of the demised premises for the purpose of
carrying on the business of Govindammal and Company, by the members of his
family." As aforesaid, the High Court directed that both the parties would
be at liberty to file fresh evidence both oral and documentary in support of
their case.
6.
After the said first order of remand, the appellate authority held, on
consideration of the materials on record including fresh evidences adduced, 1
(1988) 2 SCC 513: AIR 1988 SC 1060 21 that the grounds on which the eviction of
the tenant was founded in the proceedings in question were not the identical
grounds as indicated in the notice for eviction given by the landlord to the
tenant because the case of the bona fide requirement on account of expansion of
said partnership business had not been mentioned. The appellate authority,
however, held that the tenants, both in the counter as well as in his oral
evidence, had admitted that the landlord was running a jewellery shop in the
name of Sunder Jewellery and also a pawn broker's business run by his wife and
daughter-in-law at Door No. 141 in the name and style of S. Govindammal and
Company. The appellate authority held that in view of the aforesaid admitted
position and in view of the documents filed by the landlord which clearly
established that such partnership business had in fact been run in Door No.
141, even though the landlord had not mentioned in the notice that the landlord
required the suit premises also for the said partnership business run by his
wife and daughter-in-law, the landlord was entitled to seek eviction on account
of requirement of the said premises for the said business. The appellate
authority also held that it was not the case that the said business in the name
and style of Govindammal and Company had not been run at Door No. 141 prior to
the giving of notice for eviction and such business was introduced only for the
purpose of making a case for eviction. Accordingly, it could not be contended
that claim for eviction on account of the said partnership business was not
made with any good intention. The appellate authority also held that on perusal
of Ext. 13 filed by the landlord it could be noted that the partnership
agreement had been entered on 25-8-1988 and
from Ext. 7 it transpired that the licence for the said business had been
issued on 28-8-1982 by the Tehsildar at Myiladuthurai
and from Exts. 8 and 9 it transpired that the said partnership firm had been
registered on 24-5-1983 and from Ext. 10 it transpired that
the said partnership firm was assessed for income tax and from Exts. 11 and 12
it appeared that the income tax had been assessed from the year 1985 onwards.
The appellate authority, therefore, held that the running of the said
partnership business in the said Door No. 141 was amply proved. The appellate
authority also found that the jewellery shop of the landlord known as Sundar Jewellery
was also being run in the said Door No. 141. The appellate authority,
therefore, held that the landlord was entitled to claim eviction of the tenant
bona fide on account of the said two business concerns. The appellate authority
also held that on perusal of the landlord's Exts. 30 to 37 and 43 to 50
pertaining to the accounts of the said Govindammal and Company which were filed
after the said first order of remand, it was clearly established that the said
partnership business namely Govindammal and Company had been slowly progressing
from year 1983. Coming to the question of the location of the said business in
pawn broking and also the business of the landlord known as Sunder Jewellery,
the appellate authority held that much importance was not required to be
attached as to the location of the pawn broking business in view of the fact
that it was an admitted position that at Door No. 141 both the said two
business establishments were being run.
The
appellate authority then took 22 into consideration as to whether the landlord
had other premises in his occupation in which requirement for running the said
business concerns could be carried out. The appellate authority came to be
finding that the tenant in his evidence had admitted that the newly constructed
building of the landlord had not been fully completed and no shop was being run
in the aforesaid building. The appellate authority, therefore, came to the
finding that the landlord did not own any vacant building. Referring to a
decision of this Court made in Krishnan Nair v. Ghouse Basha2 the appellate
authority inter alia came to the finding that a petition under Section 10(3)(a)(iii)
of the Rent Act on account of requirement of a partnership business in which
the members of the family of the landlord were partners with strangers, was
admissible and the landlord was entitled to claim eviction of the tenant for
running such partnership business with strangers. The appellate authority also
took into consideration the case of bona fide requirement of the landlord in
the context of not mentioning the requirement of the landlord on account of the
said pawn broking business in the notice. The appellate authority, however,
held that since admittedly both the said two businesses had been run in the
said Door No. 141 and the said partnership business had existed even prior to
giving notice for eviction to the tenant, it was established that the
landlord's claim of requirement of the suit premises for expanding the said
partnership business was based on bona fide intention. The appellate authority,
however, held that the case of requirement of the disputed premises on account
of expansion of the landlord's said business in the name and style of Sunder Jewellery
was not acceptable but it was necessary to separate the said business in pawn
broking in the name and style of Govindammal and Company from the other
business of the landlord known as Sunder Jewellery. The appellate authority
dismissed the claim of the landlord for eviction on the ground of rebuilding
after considering the relevant evidence about the condition of the building.
Accordingly, the appellate authority affirmed the order of eviction passed by
the learned Rent Controller against the tenant under Section 10(3)(a)(iii) of
the Rent Act.
7. As
aforesaid, the said decision of the appellate authority after remand has been
set aside by the High Court in revision inter alia on the finding that the
appellate authority had not applied its mind about the exact location where the
pawn broker's shop was situated and the appellate authority had also not taken
into consideration the question of bona fide requirement of the landlord for
the purpose of carrying on the said business in pawn broking having regard to
the area under occupation of the tenant and the actual requirement for the said
business in pawn broking. The High Court was of the view that the appellate
authority was expected to go into the question whether the entire area under
the occupation of the tenant was required or not. The High Court also observed
that although the appellate authority referred to Exts. 30 to 37 and 43 to 50
and came to the finding that the said partnership business had been steadily
improving from 1983, the appellate 2 (1987) 4 SCC 404: AIR 1987 SC 2199 23 authority
failed to indicate what were the documents under the said exhibits and how the
said documents were relevant.
The
High Court set aside the order of the appellate authority on the finding that
the decision of the appellate authority was not only unsatisfactory but the
same was also not in conformity with the earlier order of remand passed by the
High Court. The High Court also held that the requirement of the building for
demolition and reconstruction had not been seriously pressed before it and such
question was, therefore, not required to be considered.
8. Mr
Chidambaram, the learned Senior Counsel appearing for the landlord-appellant,
has very strongly contended that the High Court passed the impugned order of
remand for the second time without properly appreciating the facts and
circumstances of the case and the materials on record and the import of the finding
made by the appellate authority after first order of remand. He has submitted
that the High Court has proceeded on hyper-technicality and set aside the
well-reasoned order of the appellate authority simply on the ground that the
observation made in the first order of remand had not been followed property.
He has submitted that even if it is assumed that the appellate authority had
not made the finding strictly according to the observations made in the order
of remand, if the ultimate finding of the appellate authority on the basis of
the materials on record and the evidence adduced after the first order of
remand is in conformity with the provisions of Section 10(3)(a)(iii) of the
Rent Act, there was no occasion for the High Court to set aside the said order
and send the matter back for redetermination of the case. The anxiety of the
court- should be not to prolong the course of litigation but to achieve its
finality as early as possible. He has submitted that the appellate authority
has rightly held that the exact location of the said partnership business was
not required to be determined because of the admitted position that both the
said two business concerns namely Sunder Jewellery and Govindammal and Company
had been run in Door No. 141. The real question required to be considered for
the purpose of deciding the claim for eviction is whether there was necessity
for expanding of the said two businesses and whether or not the landlord had
any alternative suitable accommodation for carrying out the said two businesses
consistent with the requirement of the same. Mr Chidambaram has also contended
that the appellate authority has referred to the assessment orders passed by
the income tax authority from 1985 onwards in respect of the said partnership
business and with reference to such assessment orders, the appellate authority
came to the finding that the business activities had been steadily increasing.
It was, therefore, not at all necessary to specifically refer in the decision
which exhibit related to what document. In any event, the materials were before
the High Court and the High Court could look into the same and could appreciate
as to whether or not the finding of the appellate authority about the steady
expansion of the said business was justified or not.
Mr
Chidambaram has also submitted that in the notice for eviction the bona fide
requirement of the suit premises also on account of the accommodation of the
said partnership business was not mentioned. But 24 such omission to mention
the said fact was of little significance because in reality the said
partnership business was in existence at the time of giving the notice for
eviction and the said business was being run even at the time of disposal of
the proceedings for eviction. He has, therefore, submitted that the appellate
authority was justified in holding that there was no lack of bona fide on the
part of the landlord in basing a claim for eviction also on account of said
partnership business although such case was not mentioned in the notice because
the said business was not brought into existence after institution of the said
eviction suit but the same was there from before. The landlord, according to Mr
Chidambaram, has led evidence to establish that for the said expanding business
more space was necessary and as the landlord did not have any other suitable
accommodation for tile said business, he bona fide required the suit premises.
He has, therefore, submitted that the impugned order has resulted in gross
failure of justice to the landlord-appellant and the same should be set aside
and the order of eviction on concurrent finding of bona fide requirement of the
landlord by the learned Rent Controller and the appellate authority should be
upheld by this Court and the order of eviction passed by the appellate
authority should be maintained.
9. The
learned counsel for the tenant respondent has, however, disputed the said
submissions of Mr Chidambaram.
It has
been contended by the learned counsel for the tenant respondent that for the
purpose of coming to a finding as to whether or not the landlord has a bona
fide requirement in basing a claim for eviction of the tenant under the Rent
Act, the Court is required to look into all the facts and circumstances of the
case. It has been contended by the learned counsel for the tenant that the
previous tenant was evicted on the ground of building and reconstruction of the
suit premises but the landlord deliberately failed to reconstruct the same and
having obtained the possession, he inducted a new tenant. It is only for the
purpose of evicting the tenant respondent for getting higher rent the claim for
eviction on the ground of building and reconstruction has been made by the
landlord but such claim has not been upheld. The learned counsel for the tenant
has also submitted that the landlord did not bona fide require the suit
premises is evident from the fact that there was no mention of requirement for
the expansion of the said partnership business in the notice for eviction. Had
there been any such requirement, the said fact should have been mentioned in
the notice for eviction. Although the landlord really did not require the suit
premises for the alleged purpose of expansion of the said business, the same
was alleged mala fide in the petition for eviction. The omission to mention the
said ground should be considered for the purpose of determining whether there
was a real need for expansion of said business. It is precisely for the said reasons,
all the antecedent facts and circumstances are required to be taken note of for
the purpose of deciding the bona fide requirement of the landlord. The learned
counsel has submitted that the Rent Act is essentially a beneficial legislation
for protection of the tenant against the caprices and whims of the landlord. The
avowed purpose of the legislation to 25 give such protection will be frustrated
if proper consideration as to the bona fide requirement of the landlord is not
taken into consideration. The learned counsel for the tenant has also submitted
that even if it is assumed that the said partnership business is expanding, it
is necessary to determine the exact nature of business and the space required
for carrying out such business consistent with the expansion of such business.
The necessity for such determination of the requirement of space had been
indicated in the first order of remand by the High Court but despite the same,
the appellate authority failed and neglected to determine the same and simply
on a finding that the business was improving and it required expansion, the
decree for eviction had been passed against the tenant. In the aforesaid facts,
the High Court was justified in setting aside the decree for eviction and
sending the appeal to the appellate authority on remand for redetermination in
accordance with the observation made in the first order of remand. No
interference is, therefore, called for in this appeal and the same should be
dismissed with exemplary cost.
10.
After giving our careful consideration to the facts and circumstances of the case,
it appears to us that non-mention of a reasonable ground for eviction in the
notice for eviction on the basis of which a claim for eviction is later on
founded usually raises a suspicion about the existence of such ground but such
non-mention by itself cannot disentitle a landlord to claim eviction on such
ground. If a claim for eviction founded on such ground in the petition for
eviction is proved to be well-founded and the same is consistent with the
grounds on which eviction is permissible in law, the landlord will be entitled
to a decree for eviction notwithstanding the fact that such ground was not
mentioned in the notice for eviction. In our view, the appellate authority has
rightly indicated in the facts of this case, that the partnership business
under the name and style of Govindammal and Company was in existence even prior
to giving notice for eviction by the landlord. Such partnership business was
registered and the licence for the business was obtained and the business had
been subjected to assessments made by the income tax authorities. Hence, such
business was not brought into existence only for the purpose of making a
foundation for eviction of the tenant with mala fide intention. Hence, in the
facts and circumstances of the case, it cannot be reasonably held that the
claim of bona fide requirement on account of the said partnership business is
per se mala fide and should not be taken into consideration simply because the
case for bona fide requirement on that account had not been mentioned in the
notice for eviction. There is no manner of doubt that the bona fide requirement
is required to be considered objectively with reference to the materials on
record and it is necessary to determine the real intention of the landlord on
the basis of evidence adduced in a case. If the materials on record clearly
justify a case of bona fide requirement, there will be no occasion for the
court to hold that the landlord did not require the premises bona fide simply
because on a previous occasion the action of the landlord for bringing an
eviction case was not bona fide.
It
should be borne in mind that cause for eviction is a recurring 26 cause of
action and even if the existence of such cause of action had not been found in
a previous proceeding for eviction, the same cannot be discarded if such claim
is established by cogent evidences adduced by the landlord in a subsequent
proceeding. It will not be correct to hold that only because after a tenant was
evicted by the landlord on the ground of reasonable requirement for building
and reconstruction, the landlord did not make the alleged reconstruction but
let out the premises to another tenant after obtaining possession, any
subsequent eviction case for the said premises deserves to be dismissed in limine.
The landlord, in our view, may bring an action for eviction of the tenant or
subsequent cause of action justifying a case of bona fide requirement.
Similarly, rejection of a case for building and reconstruction by itself will
not disentitle the landlord to get an order of eviction if the eviction on such
ground can be founded in a changed circumstance. We may also indicate here that
the contention that the Rent Act is a legislation for protecting a tenant will
be oversimplification of the legislative import of the Rent Act. In our view,
it will be more appropriate to hold that the Rent Act regulates the incidence
of tenancy and inter se rights and obligations of the landlord and tenant.
11. In
our view, Mr Chidambaram is justified in his submission that the High Court has
acted with hyper- technicality in discarding the finding of the appellate
authority about the continuous expansion of the said partnership business. The
appellate authority has referred to the exhibits including the income tax
assessment orders for the purpose of coming to the finding that the said
business had been gradually expanding. In the aforesaid facts, it was not
proper to discard such finding of the appellate authority by indicating that
the exhibits had not been elaborated in detail. In any event, such exhibits
were before the High Court for its consideration and in the anxiety to dispose
of a lis as early as practicable, the High Court should have looked into the
records and considered the justification of the finding made by the appellate
authority. It appears to us that the appellate authority has referred to the
assessment orders from 1985 and has come to the finding that the said
assessment orders indicated that the business was expanding. It is nobody's
case that the documents did not indicate such expansion in business activities.
Such finding, therefore, appears to be justified.
12.
Since the eviction proceeding is pending for long, it would have been only
desirable if the same could have been concluded before this Court. But the
requirement of space for the said partnership businesses consistent with the
nature of business and expanding activities had not been gone into by the
appellate authority and the relevant materials are also not before us. We may
also indicate here that the appellate authority has specifically held that for
the expansion of the business of the landlord styled as Sunder Jewellery no
further space was required but the partnership business in pawn broking was
required to be separated. Such finding has not been challenged before the High
Court and also before us. It therefore appears to us that the said pawn broking
business requires to be run separately. Hence, we uphold the order of remand to
the limited extent, namely, that the appellate authority on the 27 basis of
materials already on record would consider the actual requirement of space for
the said partnership business consistent with the nature of business styled as Govindammal
and Company after keeping in view, the expanding activities in such business.
If on such consideration, the appellate authority comes to the finding that the
landlord bona fide requires the disputed premises for running the said business
in a separate enclosure, the order of eviction under Section 10(3)(a)(iii) of
the Rent Act should be passed by the appellate authority. Since parties have
already led evidence pursuant to the liberty given by the High Court in the
first order of remand, no further evidence should be allowed to be led by
either of the parties. This order will, however, not preclude the tenant
respondent to give additional evidence, if any, in support of the contention
that there had been change in the circumstances after the impugned decision of
the High Court under which the landlord has already got in his possession
suitable alternative accommodation which will satisfy the requirement of the
landlord for running the aforesaid business concerns. As the matter is pending
for long, we direct the appellate authority to dispose of this matter within
three months from the date of the receipt of this order. In the facts and
circumstances of the case, there will be no order as to costs.
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