| SooperKanoon Citation | sooperkanoon.com/388911 |
| Subject | Tenancy |
| Court | Karnataka High Court |
| Decided On | Jul-12-2006 |
| Case Number | House Rent Revision Petitions 567/1999, 511/2002, 211/2003 and 14/2004 |
| Judge | H.V.G. Ramesh, J. |
| Reported in | 2006(5)KarLJ140 |
| Acts | Bombay Rents, Hotel and Lodging House Rates Control Act; Bombay Rents, Hotel and Lodging House Rates Control (Amendment) Act, 1999 - Sections 27(2); Rates Control Act - Sections 21(1), 27(2) and 27(4) |
| Appellant | Sri B.C. Sathyanarayana S/O B.K. Chamaraju;sri SalaluddIn S/O Late Hameed;sri Syed Fazlur Rahman S/O |
| Respondent | Smt. B.N. Jagannatha Rao S/O B. Narasinga Rao;sri B.S. Chayadevamma W/O B.C. Sathyanarayana;sri B.C. |
| Appellant Advocate | K. Narasimhamurthy, Adv. in HRRP 567/1999 and 14/2004, ;S.A. Mujeeb, Adv. in HRRP 511/2002 and ;G.S. Visweshwara, Adv. in HRRP 211/2003 |
| Respondent Advocate | S.A. Mujeeb, Adv. in HRRP 567/1999 and 14/2004 ;K. Narasimhamurthy, Adv. in HRRP 511/2002 and 211/2003 |
H.V.G. Ramesh, J.
1. HRRP 511/2002 arises out of the order passed by the 19th Addl. Small Causes Judge, Bangalore in HRC 1506/1997. HRRP 567/1999 arises out of the order passed by the Addl. Small Causes Judge, Bangalore in HRC 1500/1997.
2. HRC 1506/1997 was filed by the petitioner landlady seeking for possession of the petition shop premises beating No. 1 comprised in premises No. 283, 7th Cross, 1st Main Road, K N Extension, Yeshwanthpur, Bangalore 22, for her bonafide use and occupation for commencement of business. According to the petitioner, the petition premises was let out on a monthly rent of Rs. 300/- during the year 1970 for the purpose of running a General Stores by the tenant. According to the petitioner, the schedule shop premises and also other shop premises bearing Nos. 2 to 5 comprised in the property bearing No. 283 are adjacent to each other. The petitioner's husband has retired from service and her son has studied BBM and they intend to start a departmental store in the scheduled premises and the adjacent shop premises in respect of which also eviction petitions are filed. It is her case that after removing the existing partition walls between the shops they want to make it as a single compact unit for the purpose of a departmental stores and they are in genuine need of the petition premises and the other adjacent premises for their use and occupation. It is also pleaded that they have got adequate funds and reasonable experience to start the departmental stores and the petition premises is ideally situated in a business locality. It is also stated that the petitioner's family is residing in the first floor of the said building and it is convenient for them to look after the business.
3. In HRC 1499/1997 the shop premises bears No. 3 against which HRRP 211/2003 is filed
4. In HRC 1500/1997, the shop premises bears No. 4 against which HRRP 567/199 is filed.
5. HRRP 14/2004 arises out of the order passed in HRC 485/2002 in respect of shop premises bearing No. 2.
6. In all the above four HRC petitions, similar is the averments made by the landlord/landlady regarding status and also requirement.
7. As regards shop premises bearing No. 1 (HRC 1506/1997), it is the case of the tenant that the requirement of the petitioner/landlord is unreasonable and it is motivated by oblique motive and monetary consideration and as the tenant is unable to comply with the unreasonable demand of the petitioner to pay enhanced rate of rent of Rs. 1,000/- p.m. and also goodwill of Rs. 4 lakhs and ten months advance, the eviction petition has been filed. According to him, Shop No. 2 also fell vacant during pendency of the petition and the same has been let out to one Babulal and he has been running a jewelry shop and is paying a rent of Rs. 1100/- p.m. and also has paid eleven months advance besides goodwill of Rs. 4 lakhs. Similarly one more shop also fell vacant which was let out to one Ganesh Rao who is running a Automobile shop in the name of Jaleja Automobiles on a monthly rent of Rs. 800/- and from him, eleven months advance and good will of Rs. 3 lakhs has been collected. According to the tenant, if really the landlord was in need of the premises, he would have started his business but, it has not been started. The petition premises are having a dimension of 10 x 15 ft. and is not suitable for a departmental stores and it is case that the petitioner has also let out the entire ground floor. Further, it is stated that the petitioner's husband who has retired from service has also been employed in M.S. Ramaiah Medical College and is eldest son is 18 years old and the second son is 13 years old and both of them are studying and the petitioner herself is employed as a High School Teacher. It is his further submission that the petitioner has neither the experience nor necessary finance to commence a departmental store.
8. The tenant has contended that he is a family man having a wife, three sons and a daughter. The son is married and is dependent on him on the business and the 2nd son is also a graduate and is assisting this tenant in his business along with the third son.
9. In respect of HRRP 567/1999 with regard to shop No. 4, the tenant has taken a similar contention as in HRRP 511/2002. According to this tenant, he along with his elder brother purchased a running concern from one Kantharaj Shetty who had occupied the premises on a monthly rental of Rs. 50/-. Later, the rent was enhanced to Rs. 100/- when this tenant occupied with an advance of Rs. 25,000/-. In the year 1981, the tenancy was transferred in favour of this tenant and from time to time, rent has been enhanced under the threat of eviction and now the rent is Rs. 350/- p.m. It is his submission that he has got three daughters and a wife who are dependant on him and he is doing the business of sale of ready garments to eke out his livelihood.
10. According to the tenant in HRRP 211/2003 (HRC 1499/97), he has also purchased a running concern from one Salahuddin with the consent of the petitioner for a sum of Rs. 50,000/- and the petitioner collected a goodwill of Rs. 1 lakh in addition to eleven months advance. Salahuddin was paying a monthly rent of Rs. 125/- and it has been enhanced to Rs. 300/- under threat of eviction and now, the rent is Rs. 440/-. He has also got a wife and three children besides his aged parents and has earned good will and is not in a position to pay huge rent as demanded by the petitioner.
11. The tenant in respect of shop premises No. 2 in HRRP 14/2004 (HRC 485/02) contends that actually the schedule shop had fallen vacant when the need arose when it was in the occupation of one Shahul Hameed who was paying a monthly rent of Rs. 250/- and at that time the tenant was very young and taking advantage of the same, this tenant was inducted by the petitioner and a running concern was purchased by the tenant for a sum of Rs. 2,20,000/- with the consent of the petitioner and a lease deed was executed by collecting an advance of Rs. 50,000/- from the respondent. He has also collected a sum of Rs. 50,000/- from Shahul Hameed and also enhanced the rent to Rs. 1,000/-. Initially there was loss to this tenant but subsequently, he has improved in his business and established goodwill. Because of the coercive measure adopted by the petitioner, this tenant had moved the civil court by filing OS 363/1997 and by an order dated 11.2.1997, the petitioner was directed not to dispossess the tenant.
12. After enquiry in all these petitions, the same were disposed of by different courts by different orders. In HRC 1506/1997, the trial court on the strength of the material available on record has allowed the eviction petition against which HRRP 511/2002 is filed by the tenant.
13. In HRC 1499/1997, the trial court has allowed the eviction petition against which HRRP 211/2003 is filed by the tenant.
14. In HRC 485/2002, the trial court has dismissed the petition against which the landlord has come up in HRRP 14/2004.
15. In HRC 1500/1997, the trial court has dismissed the petition against which the landlord has come up in HRRP 567/1999.
16. Thus, two revisions have been preferred by the tenants and two by the landlord. All the petitions have been taken together for disposal although different judgments have been rendered by different courts.
17. It is the submission of the counsel appearing for the landlady in respect of the revisions wherein she has suffered an order of dismissal of the eviction petitions that the husband of the petitioner, after his retirement, intended to commence a departmental stores along with the third son who is a graduate in BBM and the petition shops, four in number and one more shop adjacent thereto are ideally suitable to commence the departmental store as they have to exhibit the articles and also store them by removing the partition walls. Even the tenant in respect of shop premises No. 5 has agreed to vacate and hand over possession as and when needed. It is also submitted that although when shop No. 2 became vacant, the same was let out with a condition that it should be vacated immediately after the other petition premises are vacated and all the shop premises are required by the landlord to establish her business and that she has got the retirement benefits of her husband to commence the same and will also raise a loan from the bank if needed. It is also submitted that the third son who is a graduate in BBM has knowledge and experience to run a departmental store and he could also very well assist her husband in establishing and running the departmental store. It is his further contention that the back side portion which is a residential premise has been occupied by them and it is convenient to run the business adjacent to the shop premises. Further, the go-down portion which is let out will be used by them which is convenient either for residence or for storing the articles and though it has been let out, they will take possession of the same as well. Accordingly, in respect of the petitions in which the landlord has suffered an order of dismissal, it is his submission that the trial court has not properly appreciated the requirement and, the requirement of the petitioner, looked in the context of the changed philosophy under the Amended Act, has to be rebutted by the tenant. Further, it is submitted that though the tenants have failed to rebut the requirement of the petition premises by the petitioner to commence the departmental store and though there is no other suitable alternative accommodation available except on the ground that one of the shop premises which fell vacant was let out, the tenants tried to make out that there is no genuine requirement of the petition premises and the trial court has erroneously dismissed the eviction petitions in HRC 1500/1997 and 485/2002.
18. Similarly, learned Counsel has argued justifying the eviction order passed by the trial court in respect of HRC 1499/1997 and also 1506/1997.
19. Per contra, counsel for the tenant in HRC 1506/1997 (HRRP 511/2002) submitted that the court below ignored the material evidence on record that, in respect of shop No. 2 which fell vacant, the same was let out to one Babu Lal, a Jeweler for higher rent by collecting advance and Rs. 4 lakhs as goodwill and that the husband of the landlady is employed and also her son is young and there is no requirement of the petition premises and only with an oblique motive, the eviction petition is filed. The observation of the trial court that the tenant did not say that the petitioner has got any other suitable premises is totally misconceived; the landlady, her husband and her son do not nave any experience or aptitude to commence the business of a department store; the entire premises is constructed about 75 years ago and the dividing walls are load bearing ones and if the same are removed, the entire structure will collapse and even there is no estimate taken for removing the walls and clearing the debris and, there is an admission on the part of the landlady to the effect that she cannot tell how much investment is required for the stock-in-trade to run the business and she also pleaded her ignorance as to how much money is required for removing the walls. The husband of the landlady is working in the medical department of Ramaiah College after his retirement and at least Rs. 23 lakhs are required for the alleged venture and for alteration another Rs. 3 lakhs is required and that the landlady does not have sufficient funds and that she has come out with a false case to establish a departmental store and that the son of the landlady is working in a software company getting handsome salary. Accordingly, he submitted that in the two petitions which are allowed, contradictory findings of the trial court is seen and the revision petitions require interference.
20. In respect of HRRP 211/2003 (HRC 1499/1997), learned Counsel though has taken up similar contention as in HRRP 511/2002, further submitted that the landlord has got a big go-down which faces the main road and he has kept the same vacant and he can make use of the same and there is no requirement of the petition premises. The trial court ignoring the change of circumstances and also the material evidence has passed the impugned order which requires interference.
21. On hearing the arguments of the respective parties, let me now consider whether the courts below have committed an error in passing the impugned orders.
22. Learned Counsel appearing for the tenants have relied upon the decision in the case of D'Souza A. v. Rama Rao (dead) by LRs 1978(1) Kar.LJ 235 wherein this Court has held thus:
Where a landlord requires non-residential accommodation in the occupation of the tenant for the purpose of starting a business, the landlord must mention in his petition the details of his requirements. It is for that reason that he has to adduce evidence on those points. It is only then that the Court would be in a position to appreciate and decide objectively whether the requirement is bonafide and reasonable. It is not proper for the court to start with any initial presumption or assumption in favour of the landlord.
23. Learned Counsel has also relied on the decision in Anandi D. Jadhav (dead) by LRs v. Nirmala Ramachandra Kore and Ors. : [2000]2SCR963 to contend that the expression 'acquired vacant possession' in the context ... means acquisition of vacant possession of a suitable accommodation in which one has a right to reside.
24. In another decision relied by the learned Counsel in G. Shoukath and Ors. v. V. Chandraprakash : ILR2004KAR3288 , the Division Bench of this Court has held thus:
The true position in law is that while the landlord has the benefit of a presumption in his favour in cases where he pleads personal requirement for the premises under Section 27(4) and the explanation thereto, the tenant occupant can adduce evidence to rebut the said presumption. If any such evidence is adduced in rebuttal, it is for the Court to decide whether or not the presumption available to the landlord has been rebutted.
25. Per contra, counsel appearing for the landlord/landlady has also relied on several decisions to contend that the intention of the legislature is that the landlord's need of the premises for bonafide use and occupation is to be presumed and the requirement of proof is done away with and in support of his contention, relied upon the decision in Raghunath G. Panhale (dead) by LRs v. Chaganlal Sundarji & Co. : AIR1999SC3864 wherein in respect of the Bombay Rents, Hotel & Lodging House Rates Control Act, the Supreme Court has observed that the landlord in service of a company seeking eviction for opening grocery shop need not prove that he has become jobless to get eviction order and he need not prove his experience or financial capacity.
26. Learned Counsel has also relied on the decision in G.N. Murthy and Anr. v. B. Mangilal : ILR1998KAR1189 to contend that the tenant cannot dictate to the landlord to occupy the premises that have fallen vacant if it is not suitable and also on the decision in : [2000]1SCR77 Raghavendra Kumar v. Firm Prem machinery & Co., to contend that the landlord is the best judge of his requirement for residential or business purpose and he has got complete freedom in the matter. The decision in P. Suryanarayana (D) by Lrs v. K.S. Muddugowramma ILR 2004 KAR 2398 is also relied upon to contend that as per explanation provided under Section 27(2)(r) of the 1999 Act, presumption as to requirement of the landlord is mandatory.
27. Learned Counsel also relied upon the decision in G.A. Narasimhamurthy v. P.N. Murthy ILR 2003 KAR 465 to contend that so far as requirement under Section 27(2)(r) as per the amended Act wide construction has to be given to the requirement of the petitioner for the benefit of his son. The decision in the case of P. Suryanarayana (D) by LRs v. K.S. Muddugowramma AIR 2004 SCW 1555 to contend that after the enforcement of the Rent Act of 1999, the amended Act applies to pending revision and proceedings shall continue and disposed of in accordance with the amended Act and the concept of comparative hardship is given up and the presumption as to requirement has to be mandatorily drawn in favour of the landlord.
28. In the light of the arguments advanced and the ratio laid down by the Supreme Court and this Court in respect of requirement of rebuttal evidence to disprove the requirement and also the changed philosophy of the Rent Act of 1999, the Court has to consider, having (sic) wide amplitude and without going for a pedantic approach. It is the specific case of the landlady that the residential premise is adjacent to the petition premises and they intend to open a departmental store and that her son is a graduate in BBM and that her husband has also retired from service and has got sufficient funds and, her son and husband have joined together to open the departmental store after removing the partition wall between shop Nos. 1 to 4 for storing as well as displaying the articles and the entire petition premises is required for the said purpose. It appears, in respect of these tenements different courts have dealt with differently i.e., while allowing two petitions, two courts have come to the conclusion that there is requirement of the petition premises and accordingly, ordered for eviction and, in respect of the other two petitions, the trial court has observed that there is no bonafide requirement. It is seen, during arguments before the trial court, it was canvassed that one of the tenement which had fallen vacant during pendency of the matter was let out. In this context, as a matter of understanding when it is the specific case of the landlord/landlady that they need the petition premises together to establish a departmental store in a large scale, keeping one shop vacant expecting others to vacate would not have been beneficial to him and in such circumstance when he had let out the shop, even if it is for a higher rent, cannot be held that with an intention to extract higher rent, the landlord has asked the tenants to evict the premises. Further, in G.A.N. Murthy's case cited supra, this Court has categorically stated that soon after the eviction petitions are filed and during pendency of the matter if some premise has fallen vacant, the tenant cannot dictate to the landlord to occupy the premise that has fallen vacant. Similarly, the Supreme Court has also clearly noted that the tenant cannot dictate terms as to the manner in which he has to conduct business and also as to his requirement. In the circumstances, the argument of the counsel appearing for the tenant/revision petitioner does not hold much water especially in view of the fact that throughout it is the case of the landlady that they intend to establish a departmental store after evicting the tenants in all the four tenements and though in respect of one of tenement, the same has been let out once again, the landlady has stated that the person who has occupied the premise subsequently is ready to vacate and hand over the same soon after the other petition premises are vacated. In that view of the matter, the fact that one of the petition premises was let out once again during pendency of the matter does not assume much importance.
29. In so far as the argument of the tenants that the husband of the petitioner is employed subsequently in a private hospital and the son is also working elsewhere, it has to be noted that in the decision in Roghunath Panhale's case cited supra, in similar circumstance, the Supreme Court has observed that 'a landlord need not lose his existing job nor resign it nor reach a level of starvation to contemplate that he must get possession of his premises for establishing a business. One cannot imagine that a landlord who is in service should first resign his job and wait for the unknown and uncertain result of a long drawn litigation.... Joblessness is not a condition precedent for seeking to get back one's premises'. The above ratio makes it clear that a person need not wait for an uncertainty by remaining jobless. Soon after filing the eviction petition or even prior to that if the husband of the landlady was gainfully employed instead of depending upon uncertainties and contingencies and the son is also working elsewhere, that by itself does not take away the ground of eviction or the need of the landlord. In the circumstance, the argument of the counsel appearing for the tenant cannot be accepted.
30. Further, learned Counsel although has taken me through the detailed evidence regarding the manner in which the evidence was let in by the petitioner and the various contradictions, it is to be noted as regards requirement as well as financial capacity is concerned, the Supreme Court in the above decision, has observed that it is not necessary for the landlord to adduce evidence that he had money in deposit in the bank nor to produce proof of funds to prove his readiness and willingness as in a suit for specific performance. It is also observed therein that one would not need any experience regarding grocery business which requires no extraordinary expertise. Admittedly, in the instant case the husband of the landlady is a retired man having experience in life. Similarly, the son of the landlord who is a BBM graduate is also having knowledge of marketing and business and it cannot be said that he lacks any experience.
31. As regards the finding of the trial court in HRC 1506/1997 regarding requirement of the landlord, having noted the provisions of the Amended Act and also the requirement of the petitioner and that new shops are coming up in the surrounding area and it is not difficult for the tenant to secure a shop for running his business and also that there is also a property situate in Dasarahalli measuring 60 x 18 ft. and 10 x 80 ft built up area, the trial court has formed an opinion that the petition premises is required by the landlord for opening a departmental store and that the suitability and requirement is genuine, which does not call for interference.
32. Similarly, in HRC 1499/1997 also, having considered the requirement of the landlord and also having applied the provisions of the Amended Act, the trial court has come to the conclusion that the requirement is genuine and honest and ordered for eviction which cannot be found fault with.
33. In HRC 1500/1997 against which the landlord has come up in revision, the trial court, observing that he has not taken any opinion regarding removal of partition walls and has not obtained any plan or license and estimate, has disbelieved the certificate given by the Engineer at Ex.P12 on the ground that the Engineer has not been examined. Accordingly, it has come to the conclusion that the requirement of the petitioner is not reasonable and bonafide. Of course it has to be noted that this decision was rendered prior to the commencement of the Amended Act. Be that as it may, in view of the nature of evidence available on record, it is for the court to form a presumption regarding requirement. It is admitted fact that the landlady's husband and also her son, one a retired person and another a BBM graduate, having sufficient experience and education intend to commence business after removing the partition walls between the four shops and making it as a single unit. Further, their residence is also very much adjacent to the petition premises. Therefore, the need of the landlord cannot be considered to be a mere desire, rather, it is his requirement. There is a changed philosophy in the Amended Rent Act and there is a statutory presumption available to the landlord's requirement and unless there is rebuttal evidence to the effect that there is no such requirement and unless it is shown that there is alternative suitable accommodation available to the landlord, normally the case of the landlord has to be considered to pass an order of eviction.
34. According to the tenant in HRC 1500/1997, though alternative accommodation is available, only to get more goodwill and higher rent, eviction petition is filed. But, that itself cannot be a ground to deny the landlord an order of eviction as there is a changed philosophy in the amended Rent Act. The trial court having noted that immediately after the retirement of the husband of the landlord, he has taken employment and also noting that few years prior to retirement a person will plan for his future and in the present case, the landlord has immediately taken up employment and has also let out the shop premises which had fallen vacant, has passed an order holding that the petitioner/landlord has miserably failed to proof his requirement. When there is a finding that the petition premises is required for the landlord and when it is clear that the question of comparative hardship does not arise as per the amended Act, this Court has to consider the case of the landlord positively to hold that there is a requirement. Although, it is the case of the tenant that adjacent to the petition premises there is a go-down vacant and the very purpose and intention of the landlord is to open a departmental store, it cannot be opened in the go-down or in a portion of the building. As such, the finding of the trial court in dismissing HRC 1500/1997 filed by the landlord has to be reversed holding that there is requirement of the petition premises.
35. In HRC 485/2002, the trial court while rejecting the case of the petitioner/landlady has observed that there is nothing in the pleadings of the petitioner that her husband retired during 1995 and thereafter he has thought of starting a departmental store and that the petitioner's son has not completed his education at that time and he has completed his education during 2000. As such, it was of the view that the say of the petitioner that her son is unemployed and that petition premises is required for starting a departmental store cannot be accepted at all. It has also noted that there is nothing in the pleading that her husband is retired and after retirement he is unemployed and hence, the petition premises is required. Stating that no details of requirement are pleaded in the petition and farther that the husband of the landlady and her son are not experienced in running a departmental store and also having no idea of the total investment required for commencing a departmental store, the requirement of the petitioner has been rejected. It has also noted that if the petitioner's husband had an intention to start a departmental store, there was no difficulty for starting the same in one of the petition premises which had fallen vacant instead of evicting this tenant. This appears to be a pedantic approach of the trial court ignoring the requirement of the petitioner/landlady. Further, Explanation to Section 27(2)(r) of Act is very much clear that a statutory presumption on requirement has to be presumed and as is also held by the Supreme Court in similar circumstances, the financial capacity or experience regarding the nature of business is not a necessary condition for allowing the petition. In the circumstances, the finding of the trial court in this regard is erroneous and is not in the true spirit of the amended Act. As such, the finding of the trial court in HRC 485/2002 requires to be set aside holding that there is requirement of the landlord to commence the departmental store.
36. For the foregoing reasons, HRRP 14/2004 & 567/1999 are allowed. The finding of both the courts below are set aside allowing the petition filed under Section 21(1)(h) of the Rent Control Act (Amended Section 27(2)(r) of the Rent Act, 1999).
37. HRRP 211/2003 & 511/2002 are dismissed. However, in all these cases, time is given till the end of December 2007 to enable the tenants to vacate and hand over vacant possession of the petition premises to the landlord, subject to payment of rentals regularly every month. Parties to bear their own costs.