Chettiar & Sons & Ors Vs. T. Palanisamy Gounder  Insc 264 (8 May 2002)
Lahoti & Ruma Pal Ruma Pal, J.
is an appeal filed by tenants against an order passed by the High Court at
Madras upholding the decision of the Rent Controller ordering the eviction of
the appellants under the Tamil Nadu Buildings (Lease and Control Act) Act, 1960
(hereinafter referred to as 'the Act').
appellants have assailed the decision of the High Court primarily on three
the suit premises belongs to a religious charitable Trust and, therefore, the
provisions of the Act were not applicable to the suit premises, and
there was no relationship of tenants and landlord between the appellants and
the respondent and
denial of the respondent's title by the appellants was bona fide and as such
the Rent Controller had no jurisdiction to try or determine the suit.
considering the submissions of the parties, the background in which the issues
before us arise needs to be stated.
1900, one Mandi Venkata Naicker endowed his property in Trust for religious and
charitable purposes by a registered deed dated 7th September 1900. A supplementary deed was executed by the said Venkata Naicker
on 12th April 1911 transferring further properties to
the Trust from the income of which various rituals were to be carried on.
According to the appellants the suit property was one of such Trust properties.
The second appellant was inducted as a tenant in the suit premises by the Trust
in 1942. Subsequently, the second appellant formed a partnership firm together
with his sons. The firm is the first appellant before us and the remaining
appellants are its partners. The appellants' case is that they have continued
as tenants under the Trust and the suit premises still belongs to the Trust.
to the respondent, the said premises belonged to S. Gowthaman, an heir of the
said Venkata Naicker. The respondent claims that the appellants had
acknowledged Gowthaman as their landlord and paid rent to him without protest. Gowthaman
sold and conveyed the suit property to the respondent by a registered deed
dated 15th July 1988. This fact was intimated to the
appellants by Gowthaman who attorned the tenancy in favour of the respondent by
letter dated 19th July,
1998. On 5th December, 1998 the respondent sent a registered
notice to the appellants demanding payment of rent. The appellants refused to
pay rent to the respondent on the ground that the property belonged to the
Trust and that no right, title or interest could pass under the alleged sale by
Gowthaman to the respondent.
appellants then filed an application before the Subordinate Judge at Erode
under Section 92 of the Code of Civil Procedure for leave to institute a suit
to obtain a declaration that the alienation of the suit property by Gowthaman
to the respondent was null and void and not binding on the trust and for
framing of a proper scheme for the enforcement of the trust. Both Gowthaman and
the respondent were made parties to this application.
this application was pending the respondent filed a petition in the Court of
the Rent Controller for eviction of the appellants from the suit premises on
four separate grounds under Sections 10 (2)(i), 10 (2) (vii), 10 (3)(iii), and
14 (1)(b) (2)(b) of the Act. Section 10(2)(i) provides for eviction on the
ground of default in payment of rent. The proviso to Section 10(2) allows the
Controller, if he is satisfied that the tenant's default is not wilful, to give
the tenant a reasonable time, not exceeding fifteen days, to pay or tender the
up to date rent due by him to the landlord. If the tenant avails of this
opportunity the application of the landlord "shall be rejected". The
Explanation to the sub section defines wilful default as default which
continues after the issue of two months' notice by the landlord claiming rent.
10(2) (vii) allows the landlord to ask for eviction of the tenant on the
the tenant has denied the title of the landlord or claimed a right of permanent
tenancy and that such denial or claim was not bona fide." Under the second
proviso to Section 10(1) if the Controller decides that the tenant's denial of
the title of the landlord or the claim to permanent tenancy is bona fide, then
the landlord is entitled to sue for eviction of the tenant in a Civil Court
which would have the jurisdiction to pass a decree for eviction on any of the
grounds mentioned in Section 10,14,15 and 16 of the Act, "notwithstanding
that the Court finds that such denial does not involve forfeiture of the lease
or that the claim is unfounded". It is clear from the language of this
proviso, that the Rent Controller has only to decide whether there is a bona
fide dispute as to the landlord's title and has no jurisdiction to decide the issue
of title himself. That would be within the exclusive jurisdiction of the Civil Court.
was also held in J.J. Lal Pvt. Ltd. & Ors v. M.R. Murali and Anr where this
Court having examined the relevant scheme of the Act construed the second
proviso to sub-Section (1) of Section 10 and clause (vii) of sub-Section (2) of
Section 10, in the following words:
legislative intent appears to be that denial of title can be decided by the
Controller for the limited purpose of finding out whether a ground of eviction
is made out but the questions of title should be left to be determined by the Civil Court. Once a question of title has
arisen between a landlord and a tenant and such dispute is bona fide, the doors
of Civil Court are let open to the landlord and
therein adjudication, on grounds of eviction otherwise within the domain of the
Controller, is also permitted so as to avoid multiplicity of suits and
proceedings. All the disputes between the landlord and tenant would be settled
in one forum and the need for prosecuting two separate proceedings before two fora
would be eliminated".
third ground for eviction was under Section 10 (3) (iii) which allows the
landlord to sue for eviction:
case it is any other non-residential building, if the landlord or (any member
of his family) is not occupying for purposes of a business which he or (any
member of his family) is carrying on, a non-residential building in the city,
town or village concerned which is his own".
fourth ground on which the respondent sought the appellants' eviction was under
Section 14 (1) (b) which reads:
(b) "that the building is bona fide required by the landlord for the
immediate purpose of demolishing it and such demolition is to be made for the
purpose of erecting a new building on the site of the building sought to be
to the appellants none of these provisions are applicable to the suit property
because it was a religious endowment and religious endowments have been
exempted from the Act. If this question is decided against the appellants and
we hold that the Act is applicable to the suit property, even so it is not
necessary for the purpose of this judgment to refer to the pleading or the
evidence of the respondent in support of the first, third and fourth grounds
for eviction because the High Court confined its decision to the second ground
namely whether the appellants could be said to have denied the landlord's title
and if so was the denial bona fide. Therefore we limit the narration of facts
to those which are relevant to these issues.
eviction petition the respondent claimed that the suit premises belonged to S.Gowthaman
and that the respondent had purchased the suit premises on 15th July, 1988 from the said S. Gowthaman since which date the respondent
"has become the absolute owner of the said building". The appellants
filed a counter in which, apart from denying the grounds urged for eviction, it
was claimed that the property belonged to the said Trust and not to the
respondent as Gowthaman could not have sold the property to the respondent and
that in accordance with G.O.No.2000 dated 16th August, 1976, religious
endowments like the suit property were exempted wholly from the operation of
the Rent Control Act. It was also stated that an application under Section 92
CPC had been filed by the appellants for leave to file a suit in respect of the
Trust properties including the suit premises.
order dated 21st
September, 1990, the
appellants' application under Section 92 CPC was granted and the appellants'
suit was numbered as O.S. No.539 of 1990 before the Subordinate Judge, Erode.
The appellants brought this fact to the notice of the Rent Controller by filing
an additional counter on 17th
respondent impugned the order granting leave under Section 92 before the High
Court under Section 115 CPC. The High Court allowed the Revisional Application
by an order dated 23rd August, 1991 and held that the trust was a religious
endowment and religious charity within the meaning of the Tamil Nadu Hindu
Religious and Charitable Endowment Act, 1959 and that Section 92 of the Code of
Civil Procedure had ceased to apply to Hindu Religious Institutions and
Endowments by virtue of Section 5 of that Act. The order granting leave under
Section 92 was accordingly set aside and the application of the appellants
under Section 92 CPC was dismissed as not maintainable.
On 4th November 1991 the Rent Controller allowed the
petition of the respondent and directed the eviction of the appellants from the
suit premises. He upheld each of the grounds of eviction urged by the
respondent. The specific issue viz., "whether the respondents (the
appellants before us) are justified in denying the title of the petitioner (the
respondent before us) to the petition building" was decided against the
appellants on four grounds:
appellants recognised the said Gowthaman as the owner of the building and
remitted rents to him.
From the decree passed in O.S.No.311/85 Sub Court, Erode, it could be understood that the petition-building had belonged
to the said S. Gowthaman.
said S. Gowthaman had written a letter dated
18.7.1988 to the appellants intimating to them that he had sold the building to
the respondent and that future rents might be paid by the appellants to the
said S. Gowthaman had sold the petition-building on
15.7.1988 to the respondent.
Rent Controller refused to go into the question whether Gowthaman had the right
to transfer the suit property to the respondent because:
is Rent Controller (sic) proceeding. In this summary proceedings it is not
necessary to find whether S. Gowthaman was previously entitled to the petition-
appellants preferred an appeal from the Rent Controller's decision before the
Appellate Authority. The Appellate Authority allowed the appeal. It found prima
facie that the suit property was covered by the trust which was a religious
public trust and that in terms of G.O. No. 2000 dated 16th August 1976 the Rent
Controller had no jurisdiction to entertain the respondent's application under
the Act. It was also held that the Rent Controller erred in deciding that the
property belonged to S. Gowthaman both as a matter of fact and of jurisdiction.
The Appellate Authority held that the denial of title of the respondent by the
appellant was bona-fide and that the respondent should have been directed to
establish his claim for eviction before the Civil Court.
respondent challenged the decision of the Appellate Authority before the High
Court by way of a revisional application under Section 115 CPC. By its judgment
dated 17th November, 1998 the High Court reversed the decision of the Appellate
Authority and restored the decision of the Rent Controller solely on the issues
relating to the Rent Controller's jurisdiction. The judgment then records:
counsel for the respondents request time so as to enable the tenants to vacate
the premises. Accepting the same, six months' time is granted to the
respondents from this date on condition that the respondents should file an
affidavit of undertaking stating that they would vacate and hand over the
vacant possession of the premises to the landlord on or before the said period,
without making the landlord to go to the court for taking possession. Such an
affidavit should be filed on or before 30.11.1998. If such an affidavit is not
filed within the said period, the order of eviction will come into operation
with immediate effect".
appellants did not file any undertaking. Instead they impugned the decision of
the High Court by filing a special leave petition under Article 136 of the
Constitution on 8th December, 1998. By an order dated 18th January 1999, this
Court issued notice to the respondent and passed an interim order protecting
the possession of the appellants. After hearing the parties, leave was granted
on 29th November, 1999 and interim relief granted earlier was directed to
continue pending the disposal of the appeal.
considering the correctness of the decision of the High Court, we take up for
consideration a preliminary objection raised by the appellants that the
appellants were estopped from impugning the High Court's decision because they
had requested for time to vacate the suit premises and such request had been
granted by the High Court. The objection is unsustainable. First, an objection
to the maintainability of the appeal, like other points of demurrer, may be
relevant at the time of the admission of the appeal. Once the appeal is
admitted without reserving the issue of maintainability and the matter is heard
on merits, such a preliminary objection does not survive. Second, the
appellants had no doubt requested for a stay of the execution of the decree.
That had been granted by the High Court subject to furnishing of an undertaking
by the appellants to vacate the premises within a period of six months. The
appellants did not in fact give any such undertaking. Even if they had, they
could not be denied the right to appeal to this Court on any principle of estoppel
unless the respondent could show that the appellants had thereby gained an
advantage which was otherwise not available to them; for example, if the
appellants had given an undertaking and obtained a stay of the order of
eviction beyond the period allowed for preferring the appeal or if the landlord
had consented not to execute the decree of eviction in consideration of the
appellants' undertaking to vacate . If such or other like circumstances exist,
this Court may have refused to exercise discretion in favour of the tenant
under Article 136 of the Constitution. Otherwise merely giving an undertaking
does not foreclose a tenant from availing of any statutory remedies available
to him by way of appeal or revision or under the Constitution.
this case, no undertaking was in fact given by the appellants. The question of
deriving any advantage by the appellants on the basis of such undertaking
therefore did not arise at all. In fact the application under Article 136 was
filed well within the period of limitation. The preliminary objection raised by
the respondent is misconceived and is accordingly rejected.
merits, we are of the view that the decision of the High Court cannot be
sustained. The basic question to be decided ( and which should have been
decided by the High Court) was whether the Rent Controller could have
determined his own jurisdiction finally not only with regard to the
applicability of the Act to the suit premises but also with regard to title of
the respondent to the premises.
have already noted it was and is the appellants' case that the suit property
belonged to and still belongs to a religious trust. This assertion forms the
basis not only of their contention that the Act does not apply to the suit
property but also of their denial of the respondent's title to it. In the case
before us, the Rent Controller did not address himself at all to this basic
fact. Consequently, he did not express any view on the question of the
applicability of the Act to the suit premises. The Appellate Authority no doubt
filled in the lacuna by holding, albeit prima facie, that the suit property
belonged to the Trust and that the Act did not apply to the suit premises. The
High Court erred in reversing this prima facie view.
High Court in the impugned judgment has found that the suit property was
covered by the Trust deeds in the following words: (wherein the appellants are
referred to as the respondents and the respondent as the petitioner)
"Though the learned Senior Counsel for the petitioner has initially raised
a dispute that the property in question is not the subject matter of the trust
deed, after the clarification by the learned senior counsel for the respondents
that the property has been included in the trust deed, the learned senior
counsel for the petitioner is not in a position to substantiate his stand with
respect to the same." The Trust deeds in question had been construed by
the Madras High Court itself while allowing the revision application filed by
the respondent against the order granting leave to the appellants to sue under
Section 92 in respect of the suit property. It had been held that the Trust
deeds showed that "the endowment is a religious endowment or religious
charity within the meaning of the Tamil Nadu Hindu Religious and Charitable
Endowments Act, 1959".
the Endowments Act, the supervision and administration of "religious
endowments" are vested in a hierarchy of officials consisting of the
Commissioner, Joint Commissioner, Deputy Commissioner and Assistant
Commissioner. The Endowments Act contains elaborate provisions inter-alia for
the maintenance and alienation of immovable property of a religious endowment.
Section 5 of the Endowments Act provides for certain Acts not to apply to Hindu
Religious Institutions and Endowments. The excepted enactments include Section
92 of the Code of Civil Procedure, 1908. Section 108 of the Endowments Act
of suits in respect of administration of management, or religious institutions,
etc. No suit or other legal proceedings in respect of the administration or
management of a religious institution or any other matter or dispute for
determining or deciding which provision is made in this Act shall be instituted
in any Court of Law, except under, and in conformity with, the provisions of
other words, by Section 5 and 108 of the Endowments Act, the jurisdiction which
would otherwise have vested in the Civil Courts to grant relief under Section
92 CPC in respect of public, religious or charitable trusts has been taken away
and vested in authorities constituted under the Endowments Act.
because of the special procedure to be followed in respect of religious
endowments, a notification was issued by the State Government in exercise of
powers under Section 29 of the Act to exempt any building or class of buildings
from all or any of the provisions of the Act. The notification was issued on
16th August, 1976 and reads as follows:
Ms No.2000, Home, August 16, 1976) No. II(2)/HO/4520/76.- In exercise of the
powers conferred by Section 29 of the Tamil Nadu Buildings (Lease and Rent
Control) Act, 1960 (Tamil Nadu Act 18 of 1960), and in suppression of the Home
Department Notification No. II(2)/HO/3811/74, dated August 12, 1974, published
at page 444 of Part II Section 2 of the Tamil Nadu Government Gazette, dated
August 12, 1974, the Government of Tamil Nadu hereby exempts all the buildings
owned by the Hindu, Christian and Muslim religious public trusts and public
charitable trusts from all the provisions of the said Act." The
constitutional validity of this notification has been upheld by this Court in
S. Kandaswamy Chettiar V. State of Tamil Nadu and Another 1985 (1) SCC 290.
say the respondents, this did not mean that the suit property was exempt from
the provisions of the Act, because there was nothing on record to show that the
Trust created by Venkata Naicker was a Public Trust within the meaning of the
exemption notification. The submission is unacceptable. There was on record the
two Trust deeds as also the earlier decision intra-partes on the effect and
scope of the deeds. Since the High Court had, on a construction of the Trust
deeds, held that the Trust was a "religious endowment" or
"religious charity", within the meaning of the Endowments Act, it
cannot be said without more having regard to the definition of those words in
the Endowments Act, that the claim of the appellants to be covered by the said
exemption, notification was patently wrong or unfounded.
endowment' has been defined in Section 6(17) of the Endowments Act, as follows:
endowment' or 'endowment' means all property belonging to or given or endowed
for the support of maths or temples, or given or endowed for the performance of
any service or charity of a public nature connected therewith or of any other
religious charity; and includes the institution concerned and also the premises
thereof; but does not include gifts of property made as personal gifts to the archakas,
service-holders or other employees of a religious institution."
"Religious charity" has been defined in Section 6(16) as:
charity" means a public charity associated with a Hindu festival or
observance of a religious character, whether it be connected with a math or
temple or not" In the judgment impugned before us, the High Court relying
upon three decisions came to the conclusion that in the earlier decision, no
issue had been raised and therefore no decision had been taken with regard to
the nature of the Trust so as to operate as res judicata between the parties.
According to the High Court:
issue raised in the decision in 1992-I-MLJ-109 (supra) is only as to whether
the respondents are entitled for leave to file the suit, and that was rejected,
and the apex court also confirmed the said order and so it cannot be said that
the learned Judge has decided as to whether the trust in question is a public
trust or not".
conclusion proceeds on a misreading of the earlier decision. In the revision
application, it was the respondent who had specifically raised the issue that
the Trust was covered by the Endowments Act and, therefore, Section 92 CPC did
not apply. The High Court accepted this submission. The High Court was of the
view that there was no necessity for any other evidence to be led for the
purpose of deciding the character of the Trust as it was a pure question of law
which depended on the terms of the Trust deed. It was because the High Court
came to the conclusion that the Trust was a religious endowment or religious
charity within the meaning of the Endowments Act that it dismissed the
application filed by the appellants for leave under Section 92 of the Code of
Civil Procedure. In fact, the only basis for rejecting leave under Section 92
CPC was that the Trust documents created a 'religious endowment' or 'religious
charity' within the meaning of Endowments Act and, therefore, the provisions of
the Endowments Act and not Section 92 of the CPC would apply. The decision on
the construction of the deeds of Trust is res adjudicata and binds the parties.
The three decisions referred to by the High Court for arriving at a contrary
conclusion are inapposite and do not support the conclusion reached by the High
Court. The first was a decision of the Full Bench of the Punjab and Haryana
High Court on Article 141 of the Constitution . The second was the minority
view expressed at paragraph 55 of the Report and the third was not a decision
on the principles of res judicata at all.
event and at the very least, the earlier decision of the High Court on the
construction of the Trust deeds could be said to have established a real
possibility of the suit property being covered by the exemption notification
and, therefore, outside the ken of the Rent Controller. However, it is also not
for us in this appeal to decide the issue as to the applicability of the Act to
the suit property finally. It is sufficient for the purposes of allowing the
appeal on this issue to hold that there was prima facie support for the stand
taken by the appellants in the form of the unimpeached documents relating to
creation of a Trust, the admitted inclusion of the suit property in those
documents and the unchallenged decision intra-partes that the suit property was
part of a religious endowment or religious charity within the meaning of the
decision on the second and third questions raised by the appellants relating to
the denial of the respondent's title to the suit property under Section 10 (2)(vii)
of the Act follows to a large extent from the discussion in the previous
paragraphs. If the suit property was covered by the Trust deeds, as the High
Court itself has held, the next step would necessarily be to find out how the
suit property came to be in the hands of Gowthaman.
the appellants were challenging was not only the immediate title of the
respondent but also the title of his predecessor-in-interest, Gowthaman, to the
they were entitled to do without offending Section 10(2)vii).
Court has recently held that Section 10(2)(vii) is based on "the rule of estoppel
contained in Section 116 of the Evidence Act which estops the tenant from
denying the title of the landlord at the commencement of the tenancy and the estoppel
continues to operate so long as the tenant does not surrender possession over
the tenancy premises to the landlord who inducted him in possession.
tenant is not estopped from denying the title of the landlord if it comes to an
end subsequent to the creation of the tenancy nor is he estopped from
questioning the derivative title of a transferee of his landlord" .
added) It is nobody's case that the appellants were inducted by Gowthaman from
whom the respondent derived his interest in the property. The High Court noted
that "the rent receipts were given originally in the name of E. Venkata Naicker
Trust, Erode/E.V. Krishasami Sons (management)". Therefore, the appellants
were inducted as tenants by the Trust. If the suit property was part of the
Trust, the appellants could validly raise the questions viz.
did the property come to be transferred by the Trust to Gowthaman? What was the
validity of the transfer, if any? What was the nature of the interest which Gowthaman
had in the suit property? Was it qua trustee or qua owner? If it was that of a
trustee, could he have, legally and in terms of the Trust deed, transferred the
suit property to the respondent? Yet the Rent Controller refused to go into any
of these questions although they were squarely raised by the appellants before
him. Instead he decided the title of Gowthaman on the basis of a partition deed
between the heirs of Venkata Naicker and rent receipts granted to the
appellants by Gowthaman as proprietor. The Rent Controller could have only
decided (i) whether there was a dispute regarding the landlord's title raised
by the tenant and (ii) whether the dispute was bona- fide the bona fides being
established prima facie, by evidence in support of the tenant's stand. The Rent
Controller could not have ignored the questions relating to the derivative
title of the respondent. He could not have finally decided the issue of title
of the respondent to the suit property, nor could he have, on that basis, find
that the appellants' denial of the respondents title not bonafide.
operate against the tenant as proving a ground for eviction under Section 10 of
the Act, a mere denial of the title of the landlord is not enough; such denial
has to be "not bona fide". "Not bona fide" would mean
absence of good faith or non-genuineness of the tenant's plea".
High Court upheld the title of the respondent on the basis of the definition of
"landlord" in the Act which reads:
'landlord' includes the person who is receiving or is entitled to receive the
rent of a building, whether on his own account or on behalf of another or on
behalf of himself and others or as agent, trustee, executor, administrator,
receiver or guardian or who would so receive the rent or be entitled to receive
the rent if the building were let to a tenant.' The impugned judgment is
erroneous. It failed to consider that the appellants had denied the derivative
title of the respondent and that this would not afford a ground for eviction
under Section 10(2)(vii) of the Act.
High Court also failed to examine the issue from the perspective and from
within the confines of the Rent Controller's limited jurisdiction.
High Court found that:
from 1984, accepting the said Gowthaman as the proprietor of the property the
rent has been paid" and therefore came to the conclusion that:
view of the abovesaid specific definition under the said act, the said Gowthaman
either as a person who is entitled to receive the rent or as the trustee,
should be construed as the landlord, and he issued the notice to the tenants to
pay the rent to the petitioner, and so notwithstanding the sale in favour of
the petitioner in respect of the property in question, the petitioner should be
construed as the landlord as he has been authorised to receive the rent by a
notice dated 18.7.1988 issued to the tenants by the said Gowthaman, and thereby
he is entitled to maintain the eviction petition in the capacity as
High Court's reasoning was far removed from the pleadings of the respondent.
The respondent had claimed that Gowthaman was the absolute owner of the suit
property and that such absolute interest had been purchased by the respondent.
Given this pleading the respondent could not be allowed to set up a different
case and take shelter behind the definition of 'landlord' in the Act. The definition
of 'landlord' is an enabling provision in the sense that it enables persons who
are not the owners to ask for eviction under the Act. But it does not mean that
a person who has claimed to be the landlord qua owner can jettison his case as
pleaded in his eviction petition and establish his claim on the basis that he
was otherwise entitled to claim as landlord of the suit premises. As held in
M/s Trojan & Co. V. RM N.N.Nagappa Chettiar. "It is well settled that
the decision of a case cannot be based on grounds outside the pleadings of the
parties and it is the case pleaded that has to be found".
up: we hold that there was a bona fide dispute as to title raised by the
appellants and, therefore, the Rent Controller did not have jurisdiction to
hear and finally adjudicate upon the application filed by the respondent before
it. However we clarify that this finding is limited to the issue of the Rent
Controller's jurisdiction and shall not preclude the respondent from
approaching a competent Civil Court for determination of the issue finally and
no observations made in this judgment will prejudice the trial of this or any
other issue that the respondent may raise on merits. Subject to this
observation, for all the reasons stated earlier, we set aside the impugned
decision of the High Court and allow the appeal. There will be no order as to