Madras High Court
Sridharan vs S. Natarajan, Kibayathullah And ... on 8 March, 2007
Equivalent citations: 2007(3)CTC45, (2007)3MLJ179
Author: R. Banumathi
Bench: R. Banumathi
ORDER R. Banumathi, J.
1. Aggrieved by the Order made in R.C.A. No. 8/99 reversing the Order of eviction passed by the Rent Controller in R.C.O.P. No. 4/1997, landlord has preferred CRP No. 623/2001. Appellate Authority allowing the appeal filed by the Tenant and ordering deposit of rent is the subject matter of challenge in C.R.P. No. 624/2001.
2. Revision Petitions arise on the following facts:
The first Respondent Tenant took lease of 1.45 acres of land with building, at No. 41-A, Thenpathi Main Road, Kaivilancherry Vattam, Sirkali, in the year 1985, for a monthly rent of Rs. 200/-, for running a nursery school. Rs. 2,000/- was paid as advance.
2.1. R.C. O.P. No. 7/1996:
The first Respondent has filed R.C.O.P. No. 7/1996 under Section 8(5) of the Tamil Nadu Buildings [Lease and Rent Control] Act, 1960, [for short, 'the Act']. It was his case that father of Revision Petitioner - Viswanatha Reddiar was originally receiving rents and he refused to receive rent and after issuing notice to Viswanatha Reddy [dated 16.07.1996], calling upon him to specify a bank to deposit the rents, first Respondent filed R.C.O.P. No. 7/1996 under Section 8(5) of the Act for deposit of rent into Court.
2.2. R.C. O.P. No. 7/1996:
Stating that Tenants failed to pay rents from January, 1994 onwards, Revision Petitioner filed this RCOP for eviction on the ground of wilful default. Eviction was also sought for on the ground of demolition and reconstruction and change of user.
2.3. Eviction Petition was resisted by the first Respondent contending that only the father of Revision Petitioner was receiving rents and that he has entered into a lease Agreement only with the said Viswanatha Reddiar in 1985 and not with the Revision Petitioner. According to the first Respondent, since Viswanatha Reddiar refused to receive rent, he has filed R.C.O.P. No. 7/1996 for depositing rents into the Court and no default has been committed by the Tenants. The requirement for demolition and reconstruction was not bonafide and the first Respondent sought for dismissal of Eviction Petition.
2.4. Revision Petitioner examined himself as PW-1 and produced Ex.A-3 - Lease Agreement dated 3.6.1985, which was executed by Respondents in favour of Revision Petitioner. On the basis of Ex.A-3 - Lease Deed, Rent Controller found that as per Ex.A-3, Revision Petitioner is the landlord, who is entitled to receive the rent. Observing that procedure contemplated under Section 8 of the Act was not complied with, Rent Controller ordered eviction on the ground of wilful default. Finding that the building is very old, Rent Controller held that requirement for demolition and reconstruction is bonafide. It was held that conversion of Elementary School to Matriculation school would not amount to change of user.
2.5. Petition filed by Tenant under Section 8(5) of the Act for depositing rent into Court was dismissed by Rent Controller. Aggrieved by the Order of Rent Controller both in Eviction Petition and under Section 8(5) of the Act, Tenant has preferred appeals. The Appellate Authority allowed both the appeals and reversed the Order of Rent Controller. On a joint hearing of both appeals, Appellate Authority held that at the time of Ex.A-3, Revision Petitioner was a minor. Ex.A-3 is not a valid document and set aside the finding as regards wilful default in payment of rent, and in so far as demolition and reconstruction is concerned, the Appellate Authority held that the Petitioner did not prove his bonafide requirement and also his financial capacity to demolish and reconstruct and on those findings, Appellate Authority set aside the findings with regard to demolition and reconstruction also.
3. Assailing the Order of Appellate Authority, the Learned Counsel for the Revision Petitioner/landlord contended that the Appellate Authority erred in holding that Ex.A-3 Lease Deed is a valid document, even when the Tenant has not raised that plea in his counter statement. Taking me through records, Learned Counsel further submitted that the first Respondent having made Revision Petitioner as a party in Section 8(5) Petition, is estopped from denying title of Revision Petitioner. Placing reliance upon a number of decisions, the Learned Counsel further submitted that evidence of PW-1 is sufficient to determine the condition of the building and he has means to demolish and reconstruct.
4. Supporting the findings of Appellate Authority, Learned Counsel for the Respondent has submitted that having regard to the age of Revision Petitioner, Appellate Authority has rightly held that at the time of Ex.A-3, Revision Petitioner was a minor and Ex.A-3 Lease Deed is not a valid document. Pointing out deposit of rents as per direction of the Court, Learned Counsel for the first Respondent/Tenant urged that no wilful default was committed by the Tenant.
5. It is not in dispute that the first Respondent is a Tenant and tenancy was for running a school and monthly rent was originally Rs. 150/- and then increased to Rs. 200/-. What is in dispute is, as to who is the owner of the building - whether it is the Revision Petitioner or his father Viswanatha Reddiar.
6. Before considering the merits of other contentions, let us have a look at Ex.A-3, based on which Appellate Authority has reversed the eviction Order. Ex.A-3 is the Lease Deed [dated 03.06.1985], executed by the Tenants in favour of the Revision Petitioner. A reading of Ex.A-3 would show that the Respondents executed the same only in favour of Revision Petitioner, agreeing to take on lease the demised premises on a monthly rent of Rs. 150/- from June, 1985 onwards. Signature in Ex.A-3 is not disputed by the first Respondent. According to the Tenant, he only states that at the time of execution of Ex.A-3, Revision Petitioner was a minor and therefore, Ex.A-3 is not a valid document. It is seen from Ex.A-3 that no where it is indicated that the Petitioner was a minor at the time of Ex.A-3. Also on a perusal of counter statement filed by Tenants, it is seen that Tenants have not at all raised any plea challenging the validity of Ex.A-3. In fact during trial, it was not at all made an issue, nor were the witnesses questioned on this aspect.
7. In the Eviction Petition filed in 1997, age of the Revision Petitioner is stated as 28 years. At the time Revision Petitioner was examined in Court in 1998, in the deposition, his age has been stated as 30 years. In reference to age of Revision Petitioner stated in RCOP and in the deposition, plea regarding age of Revision Petitioner and that he was a minor in 1985 was taken for the first time in the grounds of appeal when the Tenant has preferred RCA. Hearing arguments across the Bar, the Appellate Authority erred in holding that the Revision Petitioner was not capable of entering into a lease Agreement in June, 1985. The Appellate Authority has failed to take note of absence of any such plea in the counter statement.
8. Even assuming for a moment without admitting that the Revision Petitioner was only a minor in 1985, it has to be pointed out that Ex.A-3 was not signed by the Revision Petitioner. It is only a document executed by the Tenants in favour of the Revision Petitioner. There is no impediment for a minor holding any immovable property and he very much falls under the definition of landlord and under Section 2(6) of the Act. The finding of Appellate Authority that Ex.A-3 is not a valid document cannot be sustained either factually or legally.
9. Signature of Tenants in Ex.A-3 is not disputed. Tenancy is also not disputed. In his evidence, the first Respondent/Tenant has stated that the demised premises belongs to four sons of Viswanatha Reddiar and his brother's son Rajasekaran. In the counter statement, the first Respondent has admitted that "Revision Petitioner and his father have received the rent periodically till March, 1988". In his oral evidence also, the first Respondent has admitted that the Revision Petitioner also used to collect rent. Accepting Revision Petitioner as the landlord, is evident from the pleadings and conduct of the parties. While so, Appellate Authority erred in holding that the Revision Petitioner was a minor in 1985 and that Ex.A-3 was not basis for lease. The contention of the Tenant that only Viswanatha Reddiar is his landlord cannot be countenanced.
10. Wilful default : Revision Petitioner sought for eviction on the ground of wilful default alleging that the first Respondent has committed default in payment of rent from January, 1994. Contention of the first Respondent is that Petitioner's father Viswanatha Reddiar has been receiving rent from the Respondent and Tenant used to send rent by Money Order and the said Viswanatha Reddiar had also received the same and hence there is no wilful default. As per Ex.A-3, when Petitioner is the landlord, sending rent to Viswanatha Reddiar is not proper tender of rent.
11. According to the Tenant, rent was regularly paid to Viswanatha Reddiar, father of Revision Petitioner and since 26.6.95, rents were paid by way of Money Order till March, 1996 and thereafter, Viswanatha Reddiar refused to receive rents. Further case of the first Respondent is that he has sent Ex.P-13-Notice to Viswanatha Reddiar as contemplated under Section 8(2) of the Act and that notice was returned [Ex.B-14] and there was no wilful default in payment of rent by the first Respondent. Having executed lease Agreement in favour of Revision Petitioner, Tenant is not absolved of wilful default by alleged payment of rent to Viswanatha Reddiar. Issuance of Notice to Viswanatha Reddiar is not in compliance of Section 8 of the Act.
12. Before invoking Section 8(5) of the Act, certain statutory requirements are to be complied with. If the legal requirements are not complied with, even though there was deposit of rent, the same cannot be construed as valid tender to the landlord and the Tenant must be deemed to be a defaulter in payment of rent. Without issuing any notice to the Revision Petitioner, and without complying with the legal requirements contemplated under Section 8(5) of the Act, Tenant has rushed to the Court and the same is not in accordance with law and he cannot escape from the liability of being evicted.
13. Holding that strict compliance of procedure under Section 8 of the Act is necessary, in 2002(4) CTC 572 [E. Palanisamy v. Palanisamy(D) by Lrs. and Ors.], the Supreme Court has held:
Mere refusal of landlord to receive rent cannot justify action of Tenant in straightaway invoking Section 8(5) of Act without following procedure contained in earlier Sub-sections. Plea of substantial compliance was therefore rejected. Tenancy legislation is normally intended to benefit Tenants. But benefits conferred on Tenants can be enjoyed only on basis of strict compliance of statutory provisions. Equitable considerations have no place in such matters. Strict compliance of procedure by Tenant is necessary. Omission to avail prescribed procedure disentitles Tenant to plead that there was no wilful default on his part. Landlord is entitled to seek eviction of Tenant on ground of wilful default in payment of rent.
Tenant has neither paid the rent to the Revision Petitioner nor has he issued notice to the Revision Petitioner. As held by the Supreme Court, since there is no strict compliance of the procedure, Tenant cannot wriggle out of the situation.
14. In his evidence, PW-1 has stated that after 1994, Tenant has not paid the rent inspite of demand to pay the rent. That being so, Tenant cannot wriggle out of the situation by filing Petition for depositing the rent. Evidence of Tenant that Viswanatha Reddiar refused to receive the rent is not sufficient. Without paying rent to the Revision Petitioner resorting to provisions of Section 8 of the Act, there is no bonafide on the part of the Tenant. In 2000 (2) MLJ 204 [Srirangaraja and Ors. v. Ponniah Thevar], it was held as under:
Under Section 25 of the Act, the High Court is entitled to interfere if a material piece of evidence is omitted to be considered and the non-consideration has materially affected the decision of the case.
For wilful default, coupled with denial of title of landlord, landlord is entitled to eviction. Appellate Authority was not right in ignoring material piece of evidence.
15. Section 14(1)(b) - Demolition and Reconstruction:
In his evidence, landlord has clearly stated that the building is more than 40 years old and that it was not in good condition and he had arranged to build a new terraced building. Though Tenant has denied title, the age of the building was not disputed. Referring to the evidence of Tenant, wherein the Tenant himself has accepted that the building was 50 years old and it is having Mangalore terrace, Rent Controller held that the building is aged and requires demolition and reconstruction.
16. The Learned Counsel for the Petitioner/landlord has submitted that the Appellate Authority without properly analyzing the evidence had set aside the findings of Rent Controller and the finding recorded by the Appellate Authority is against evidence. It was further contented that landlord has made out a bonafide case for demolition and reconstruction and the Appellate Authority failed to appreciate the same.
17. The Learned Counsel for the Respondent/Tenant has contended that the Revision Petitioner has not proved the bonafide by proving the means and preparation done by him for the construction of the building etc. Placing reliance upon [R. Mohammed Hanif v. Abdul Wahab], it was contended that age and condition of the building is to be decided based on the evidence adduced by the landlord and such evidence is lacking in this case.
18. Under Section 14(1)(b) of the Act, Order for eviction may be made if the Controller is satisfied that the building is bonafidely required by the landlord for immediate purpose of demolishing it and such demolishing is to be made for the purpose of erecting a new building on the site of the building sought to be demolished. The basic stipulation for passing an Order of eviction is satisfaction of bonafide requirement. The bonafide requirement can be established by several ways. In [Vijaya Singh v. Vijayalakshmi Ammal], Supreme Court has laid down the following guidelines as to what are the relevant materials to be taken into account to find out whether requirement of the landlord is bonafide or not. The Supreme Court has held as:
(1) bonafide intention of the landlord far from the sole object only to get rid of the Tenants;
(2) the age and condition of the building;
(3) the financial position of the landlord to demolish and erect a new building according to the statutory requirements of the Act.
Supreme Court has further held that these are some of the illustrative factors which have to be taken into consideration before an Order is passed under Section 14(1)(b) of the Act. No Court can fix any limit in respect of the age and condition of building. That factor has to be taken into consideration along with other factors and then a conclusion one way or the other has to be arrived at by the Rent Controller.
19. It is the settled position of law that in order to seek eviction of the Tenant under Section 14(1)(b) of the Act, it is not necessary that the building should be in dangerous and dilapidated condition, requiring immediate demolition, though it is necessary to find out the condition of the building. In a number of decisions, it has been held that condition of the building is not so essential and even if the building may not be much dangerous, if it is shown that the building is bonafide required by the landlord for immediate purpose of demolition, eviction could be ordered. [see Kuttappan (died) v. Civil Advocates Clerks' Association; Saraswathiammal [dcd] and 2 Ors. v. Mallikarjun Raja and 2 Ors.; 2000(1)MLJ 747 Mohammed and Sons v. Abbadhai Jodhpurwala; Habibulla v. Mohamed Sultan; 1997 I LW 323 Sherwood Educational Society v. Abid Namazie and Ors. 2002(4)CTC 123 Amaiyappa Transport v. N.S. Rajulu.]
20. It is admitted by both parties that building is aged 50 years with Mangalore Tiles and Mangalore Terrace. The building is situated in prime locality in Myladuthurai Main Road, Sirkali. It is stated to be opposite to Sree Theatre. When the property is in prime locality and the area is developing to a great extent, quite naturally, the landlord wishes to demolish the building and put up new construction. In 1997(1)LW 323 [Sherwood Educational Society v. Abid Namazie and Ors.], Justice S.S. Subramani has held "It has also come out in evidence and it is also alleged in the Petition that in the nearby locality brand new buildings have come up and the area is developing to a great extent. If the present building is allowed to continue there, that will be a misfit in the locality. As V.R.Krishna Iyer, J, said, "it will be like a pimple in the fair face".
21. Placing reliance upon [R. Mohammed Hanif v. Abdul Wahab], it was contended that age and condition of the building is to be decided based on the evidence adduced by the landlord and landlord has to prove that damage to structure cannot be repaired economically and that demolition and reconstruction is the only solution. Law does not intend to place such an handicap upon the landlord. If bonafide is established, then the landlord is entitled to get an Order of eviction. In a Petition for eviction on the ground of demolition and reconstruction, no limit could be fixed in respect of age and condition of the building. The factors like locality in which the building is situated, definite advantage to landlord if new building is put up with modern amenity and developing nature of locality are also relevant considerations. Evidence of PW-1 is sufficient to hold that he intends to put up new construction which would be advantageous to him.
22. Means:
In his evidence PW-1 has stated that he has sufficient means to put up construction. PW-1 has stated that he has immovable properties and cash of Rs. 1,00,000/-. PW-1 has further stated that he can mobilize funds by selling lands and jewels. Evidence of PW-1 is sufficient to hold that landlord has means to put up construction.
23. Landlord need not produce currencies before the Court to prove his means. PW-1 has stated that he owns immovable properties which is sufficient to establish means of the landlord. Since the property is in prime locality, which is developing, the Petitioner could very well mobilize funds either from Banks or Financial Institutions. Holding that raising of funds for constructing a structure in commercial centre is not at all difficult when a large number of builders, financiers as well as banks are willing to advance funds to erect new structures in commercial areas, in 2006(3) MLJ 29 [Venugopal v. Karruppusami and Anr.], Supreme Court has observed thus:
...In the instant case, we find that the property owned by the landlord, whatever may have been its value in the past, has acquired commercial value and, therefore, the landlord wishes to demolish the old single storey structure and to construct a multi - storeyed building which may fetch him higher rent, apart from serving his own needs. The landlord had already applied to the competent authorities and got the plans approved. Taking into consideration all these reasons, we are convinced that the landlord bona fide intends to demolish the old building and to construct a new one. Raising funds for erecting a structure in a commercial centre is not at all difficult when a large number of builders, financiers as well as banks are willing to advance funds to erect new structures in commercial areas. This is apart from the fact that the landlord has himself indicated that he was willing to invest a sum of Rs. 1.5 lakhs of his own, and he owns properties and jewellery worth a few lakhs....
In the instant case, it is quite obvious that the premises is situated in Myladuthurai Main Road, stated to be a commercial locality in town. Hence it would not be difficult for the Revision Petitioner/landlord to raise funds either from financial institutions or bank, who will be willing to advance funds to put up new construction.
24. Petitioner has not produced approved plan. But the statute does not say that only if the approved plan is filed before the Court, eviction could be ordered. Filing of approved plan is only one of the factors to prove bonafide. In this case, RCOP was filed in 1997. Even if the Revision Petitioner had obtained a plan in 1997, the same cannot be made use of at present. Bonafide of landlord cannot be doubted on the ground of non-filing of approved plan.
25. Bonafide requirement is proved by the age of the building and by the evidence of PW-1 regarding his means and bonafide requirement. Without considering the bonafide requirement in the light of well settled position of law, Appellate Authority erred in reversing the Order of eviction on the ground of demolition and reconstruction.
26. The Learned Counsel for the Tenant has contended that the Tenant is running a school and if eviction is ordered, it would greatly affect the interest of school children. Onbehalf of the Learned Counsel for the Revision Petitioner, it was submitted that Tenant has already shifted the school to the newly constructed building and the demised premises is used only for parking the school buses. School run by the Respondent is not for charity or on philanthropy. Landlord has produced the phamplet issued by the school, from which it is seen that the school is commercially oriented. In an identical case, where the Tenant was running school, observing that the school is being run not for social service, in [Harrington House School v. Ispahani and Anr.], Supreme Court has held:
The appellant school is an unrecognized private school run by the Tenant catering to the needs of non-resident Indians who have had to leave their children behind in the country. Indeed, the school is being run not for social service, but for the private earnings of the Tenant. The proposed reconstruction would put the property to optimum utility and would be able to provide a roof over the head of and shelter for many a family hitherto deprived of the same and may also provide additional space for business and commerce if a part of the proposed construction will be commercial. It is not possible to think that in such circumstances eviction under Section 14(1)(b) can be denied in the name of public interest.
27. Change of User:
Courts below have recorded concurrent finding that running of Matriculation School would not amount to different user. I find no reason to take a different view from that concurrent finding.
28. The findings rendered by the Appellate Authority suffer from perversity and infirmity, committed due to non-application of correct principles and misreading of the evidence available on record. It is true that scope of revisional jurisdiction under Section 25 of the Act would not normally permit this Court to re-appreciate the evidence. But it is settled law that the revisional jurisdiction of the High Court under the Act is wider than Section 115 of CPC. When this Court finds illegality or impropriety in the Order passed by the Appellate Authority, High Court can certainly interfere to correct the same by reversing such Order.
29. In this context, it is worthwhile to refer to the observations of the Supreme Court made in 2001 (3) LW 224 [Shaw Wallace & Co. Ltd. v. Govindas Purushothamdas and Anr.]. The Supreme Court has held as follows:
On a plain reading of Section 25 of the Act, it is clear that the revisional jurisdiction vested in the High Court under that Section is wider to satisfy itself as to the regularity of the proceeding, of the correctness, legality or propriety of any decision or Order passed therein and if, on examination, it appears to the High Court that any such decision or Order should be modified, annulled, reversed or remitted for reconsideration, it may pass such orders accordingly.
30. The same principle has been reiterated by the Supreme Court in the decision reported in P.S. Pareed Kaka and Ors. v. Shafee Ahmed Saheb . The Supreme Court has held that the High Court has jurisdiction to go into the legality or correctness of the decision, which includes the power to appreciate evidence and that the High Court can interfere with the finding of fact also. The examination as to the correctness involves appreciation of evidence and that the High Court can interfere with the finding of the Rent Controller if it is entirely improbable.
31. The approach of the lower Appellate Court is more to pick holes in the case of the landlord and then consider whether the need is bonafide, as a result of which lower Court has committed grave error, which has led to miscarriage of justice. In view of the above fact and legal situation, in my considered view, the Appellate Authority has misconstrued law and evidence and erred in reversing the Order of eviction passed by the Rent Controller. The Order of Appellate Authority is to be set aside and Order of eviction passed by the Rent Controller is to be confirmed.
32. The Order of Appellate Authority made in R.C.A.Nos. 8 and 11 of 1999 on the file of Sub Court, Mayiladuthurai are set aside and these CRPs are allowed. Order of Eviction ordered by the Rent Controller in R.C.O.P. No. 4/1997 is confirmed. R.C.O.P. No. 7/1996 filed by the first Respondent Tenant under Section 8(5) of the Act stands dismissed.