Madras High Court
M.Ramakrishnan (Died) vs Hindustan Petroleum Corporation Ltd on 9 October, 2017
Author: S.S.Sundar
Bench: S.S.Sundar
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
Dated: 09.10.2017
Reserved on: 31.01.2017
Delivered on: 09.10.2017
CORAM
THE HONOURABLE MR.JUSTICE S.S.SUNDAR
Second Appeal No.1109 of 1998
1.M.Ramakrishnan (Died) : Plaintiff / Appellant / Appellant
2.R.Kanmani
3.R.Rajkumar : Appellants
-Vs-.
Hindustan Petroleum Corporation Ltd.,
having its Registered Office at
Door No.171, Jamshedji Tata Road,
Bombay, through its Power of Attorney and
its Chief Regional Manager,
P.V.Vaidyanathan, having
office at Gandhi Irwin Road,
Egmore, Chennai ? 8. : Defendant/Respondent/
Respondent
(Appellants 2 and 3 brought on record as LR of the deceased sole appellant as
per order of the Court dated 08.10.2002 made in C.M.P.Nos.11749 to 11751 of
2002 by RBJ)
(Appellant 3 declared as Major and guardianship discharged vide order dated
27.08.2014 and made in M.P.(MD)No.1 of 2014 in S.A.No.1109 of 1998 by VMVJ)
Prayer: Second Appeal filed under Section 100 of Civil Procedure Code,
against the judgment and decree of the Court of the Principal District Judge,
Madurai in A.S.No.235 of 1996, dated 07.01.1998 confirming the judgment and
decree of the Court of the First Additional Sub Judge, Madurai in O.S.No.606
of 1993, dated 26.08.1996.
!For Appellants : Mr.A.Arumugam
for M/s.Kara Associates
^For Respondent : Mr.M.Sridhar
:JUDGMENT
This appeal was filed by the plaintiff in the suit in O.S.No.606 of 1993 on the file of the First Additional Sub Court, Madurai. Since the sole appellant died, during the pendency of this Second Appeal, appellants 2 and 3 were brought on record as the legal representatives of the deceased sole appellant.
2.The first appellant in this appeal originally filed the suit in O.S.No.606 of 1993 on the file of the First Additional Sub Court, Madurai, for declaring that the lease deed dated 25.07.1973 purported to have been executed by the plaintiff's mother one P.Lakshmi Ammal in favour of M/s.Caltex (India) Limited, is void, non-est and unenforceable and consequently declaring that the defendant has no right to claim renewal in its favour on the basis of the lease deed dated 25.07.1973 and for directing the defendant to deliver possession of the plaint schedule property to the plaintiff. The suit is also for past mesne profits and future mesne profits.
3.The case of the plaintiff are as follows:
3.1.The suit property belonged to the mother of the plaintiff by name M.Lakshmi Ammal. The plaintiff's mother died on 12.05.1985 leaving behind her husband one S.A.Murugaiah Pillai and the plaintiff. The plaintiff's father also died on 22.12.1991. Hence, the plaintiff is the sole owner of the plaint scheduled property. The plaintiff's mother was an illiterate women and she could not read or write any language. Recently the plaintiff came to know that the defendant by letter dated 29.12.1992 wanted renewal of the lease of the plaint scheduled property in favour of the defendant as successor in interest of M/s.Caltex (India) Limited. In the letter, the defendant made reference to the lease agreement dated 25.07.1973 between the plaintiff's mother and M/s.Caltex (India) Limited in respect of the suit property for a period of 20 years. Though the lease period also would come to an end on 30.04.1993, the defendant mentioned in the letter that in terms of Section 7(3) of Act 17/1977, the defendant was entitled to renew the lease for a further period of 20 years commencing from 01.05.1993. It was only thereafter the plaintiff came to know about the lease deed dated 25.07.1973.
However, seeing that the terms of the lease agreement are unconscionable, the plaintiff realised that the illiteracy and ignorance of the plaintiff's mother had been exploited to include unconscionable terms which could not have been subscribed by a prudent person. The terms of the lease is therefore to be regarded as non-est as it is opposed to public policy, apart from being void for being executed by the executant without knowing the terms of the contract.
3.2.Since the contract itself is void and non-est, the provision of Act 17/1977 cannot be invoked. The plaintiff also is entitled to claim past mesne profits and future mesne profits, taking into consideration the location of the property and other relevant factors.
4.The suit was contested by the defendant. There is no dispute about the ownership of the property. The defendant is a successor in interest of M/s.Caltex (India) Limited. Hence, it is stated that the defendant is entitled to the rights of M/s.Caltex (India) Limited, as per the lease deed dated 25.07.1973, in respect of the suit property. It is stated further that the lease deed, dated 25.07.1973, is a genuine transaction which was attested by the plaintiff's father Mr.S.A.Murugaiah Pillai. Since all the terms and conditions were agreed between the parties, the plaintiff is not entitled to submit anything contrary to the terms and conditions of the lease deed and the legal implication of the lease deed. The defendant is entitled to seek renewal of the lease for a further period of 20 years with effect from 01.05.1993 and that therefore, the defendant gave a letter dated 29.12.1992 claiming renewal of lease. The contention of the plaintiff that the terms of the lease deed with several unreasonable and unconscionable and unfair clauses would render the lease deed void, was specifically denied by the defendant with reference to facts. It is further stated that the right of renewal has been conferred by virtue of Section 7(3) of Act 17/1977 and that the said right which is a statutory one conferred upon the lessee would render the suit liable to be dismissed as not maintainable. The allegation that the lease transaction was nothing but exploitation by M/s.Caltex (India) Limited on account of the illiteracy of M.Lakshmi Ammmal, are denied as false and fraudulent. The contention of the plaintiff that he came to know about the lease deed only in the year 1992 after receiving notice for renewal from the defendant is also denied. The defendant further contended that there is no cause of action to maintain the suit. All other allegations made in the plaint are also denied. The defendant further contended that the defendant is in lawful possession and enjoyment of the suit property as a lessee as per the terms and conditions of the registered lease deed. Since the defendant is entitled to renewal of lease upto the period 30.04.2013, it is contended that the present suit for recovery of possession is not maintainable in law and on facts and that possession and enjoyment of the defendant as a lessee till 30.04.2013 cannot be disturbed by the plaintiff or his predecessor in interest.
5.The trial Court after framing necessary issued dismissed the suit rejecting the contention that the lease deed dated 25.07.1973 is void. The trial Court has come to the conclusion that the lease agreement dated 25.07.1973 is a genuine transaction and that it is not in violation of any law. Further, it was also held that the contention of the plaintiff that the lease deed dated 25.07.1973 should be declared as void has no merits. Further, the trial Court held that as per Section 7(3) of Act 17/1977, the defendant is entitled to get renewal of the lease till 2013. Since the trial Court came to the conclusion that the plaintiff is in lawful possession of the property as a lessee, the trial Court categorically observed that the plaintiff can only evict the defendant by following due process of law particularly by filing a suit for ejectment in the manner known to law. It was further held that the plaintiff is not entitled to seek for recovery of possession.
6.Aggrieved by the judgment and decree of the trial Court made in O.S.No.606 of 1993, dated 26.08.1996, the plaintiff has preferred an appeal in A.S.No.235 of 1996 on the file of the Principal District Judge, Madurai. The main point that was focussed by the plaintiff before the appellate Court also was on the issue whether the lease deed, which was executed under Ex.A8, is a void agreement or voidable agreement. The further issue was about the contention of the defendant with regard to the statutory renewal of lease for a further period of 20 years from the date of expiry of the lease agreement. The question whether the plaintiff is entitled to recover the suit property from the defendant company or not was also framed. After considering the rival submissions and the terms of the lease agreement, dated 25.07.1973, the appellate Court came to the conclusion that the findings of the trial Court are perfectly correct.
7.Sum and substance, the appellate Court also fell in line with the trial Court and dismissed the appeal specifically holding that the lease deed under Ex.A8, dated 25.07.1973, is not void or voidable agreement and that the defendant company is entitled to renewal of lease for a further period of 20 years as per Section 7(3) of the Act 17/1977. Aggrieved by the concurrent findings of the Courts below, the above Second Appeal was filed in the year 1998.
8.This Court at the time of admitting the Second Appeal framed the following substantial questions of law:
?(a) Can the defendant resist a suit for possession filed by the lessor after the expiry of the lease Ex.A8 merely relying upon his exercise of option for renewal as provided under Section 7 of the Caltex (Acquisition of shares of Caltex Oil Refining (India)) Ltd. (And of the undertakings in India of Caltex (India) Ltd. Act, 1977 (17 of 1977)?
(b) In the absence of a registered lease deed executed by the lessor for the renew period as required under Section 107 of the Transfer of Property Act, can the defendant resist the suit for possession after the expiry of the period prescribed under the original lease deed Ex.A8?
(c) Whether the Courts below were right in holding that merely by reason of Section 7 of Act 17/1977, the defendant is entitled to continue for a further period of 20 years on the same terms and conditions? and
(d) Whether the Courts below erred in thinking that because original lease deed Ex.A8 is held valid, the defendants automatically get the right to continue in possession for a further period of 20 years on the same terms and conditions by reason of the provisions of Central Act 17 of 1977??
9.The learned counsel appearing for the appellant though submitted that the lease agreement is absolutely void and unenforceable, as it was executed by an old, illiterate women who did not know the contents of the lease deed and referred to certain facts, ultimately did not press further the issue relating to the validity and genuineness of the lease deed dated 25.07.1973. However, a new point was submitted before this Court. It is contended that during the pendency of the Second Appeal, the period of renewal for a further period of 20 years is also over in the year 2013 and that therefore, the defendant's possession as on date is unlawful and the defendant cannot retain the possession. In view of the expiry of the lease, it is contended that the plaintiff has to succeed as the defendant is bound to give vacant possession to the plaintiff. The new question of law was allowed to be raised after giving opportunity to the learned counsel for respondent. The only issue that arise for consideration is therefore, whether the plaintiff is entitled to recovery of possession in view of the expiry of the lease in 2013 during the pendency of this Second Appeal.
10.The learned counsel appearing for the appellant further submitted that this Court has inherent power under Section 151 of C.P.C. to render complete justice between the parties. It was therefore suggested that the Court can take subsequent event into consideration and should mould the relief. The learned counsel appearing for the appellant relied upon an unreported judgment of this Court dated 12.09.2007 in S.A.(MD)No.1393 of 1996 in the case of Sundara Konar and others vs. Bharath Petroleum Corporation Limited. In the said judgment, this Court has held in paragraph 9 as follows:
?9. But, at the same time, it is not in dispute that this Court, while dealing with the second appeal, cannot shut its eyes to the supervening events and the subsequent developments during the pendency of the case. In the instant case, the respondent/defendant claims to have got a right for the automatic renewal of the lease for once and not more than once. The first period of renewal has come to an end by 30.06.1976. It is not the case of the respondent/defendant that the respondent/defendant was either entitled to a second renewal or intimated its intention to get the lease renewed for a second time. The learned counsel for the respondent/defendant also admitted, across the bar, that the respondent/defendant did not claim any right of second renewal and that hence, the expiry of the renewed lease period by 30.06.1996 could be taken into consideration to decide whether the appellants/plaintiffs were entitled to seek delivery of vacant possession of the suit land. After giving due considerations to the submissions made on either side, this Court is of the considered view that the said supervening circumstance, namely, the expiry of the renewed lease period by 30.06.1996, also has to be taken into consideration and on that basis, the plaintiffs should be granted the relief of recovery of vacant possession from the defendant.?
11.However, it is pertinent to mention that in the said judgment, the learned counsel appearing for the respondent corporation has agreed to surrender vacant possession of the suit land. The learned counsel appearing for the appellant relied upon the judgment of this Court in the case of Varghese Daniel v. Balakrishan and another reported in 1998 (II) CTC 337 wherein this Court has held as follow:
?21. The learned counsel Thiru S. Jayaraman, finally contended that in view of the inconsistent case of the petitioner, injunction should not be granted. In Rajeswari v. Dhanammal, 1994 (1) M.L.J. 401 Justice Abdul Hadi, has held that where one party did not seek the relief on the basis of the relief of the other party, but only on the facts established on record though they were at variance with his own pleading, relief can be granted. In a case where parties lead in evidence and the facts established enable a party to obtain a particular relief, based on the facts established, equity and justice rush to his resque notwithstanding the variance in the pleading to grant the relief to which he is entitled to as per the facts established. This cardinal principal fundamental for Courts is to render justice to parties as otherwise after arriving at the finding on the evidence produced before if the Court has to shut its eyes and direct the party to another litigation, the basic purpose of establishment of Courts of law i.e., to maintain peace, law and order in a society is defeated. Therefore, the attempt of the Courts must always be to minimise the litigation and not to multiply it.?
12.After referring to the above judgment, the learned counsel for the appellant submitted that it is open to the Court to grant appropriate relief on the facts established on record by applying principles on equity and justice.
13.The learned counsel appearing for the appellant relied upon the judgment of the Full Bench of this Court in the case of the Hi. Sheet Industries v. Litelon Limited reported in 2006 (5) CTC 609 wherein it has been held as follows:
?11.13. Ordinarily, a suit is tried at all stages on the cause of action as it existed on the date of its institution, but it is open to the Court even including a Court of appeal to take notice of the events which have happened after the institution of the suit and afford relief to the parties in the changed circumstances, where it is shown that the relief claimed originally has (i) by reason of subsequent change of circumstances become inappropriate,or (2) where it is necessary to take notice of the changed circumstances, in order to shorten the litigation or (3) to do complete justice between the parties.?
14.The learned counsel appearing for the appellant further relied upon a judgment of the Division Bench of this Court in the case of Hindustan Petroleum Corporation Limited v. Devaraj Chordia reported in 2005 (2) CTC 401 wherein it has been held as follows:
?9. One would have expected that after 1989 the appellant herein like an honourable person would have vacated the suit property since its leasehold right ceased to exist after 1989. However, unfortunately, in our country, what is often seen is that people continue to remain in illegal possession of a property even for several years after their right to occupy the same ceased to exist. This practice has now become rampant in our country and the time has come when it must be curbed. An honourable person should vacate the property over which his lease or licence has expired and hand over possession of the same on the date of expiry of the lease or licence to the landlord/owner unless there is a fresh mutual agreement which permits him to continue in possession. It is to be noted with deep distress that the appellant which is a well known Public Sector Undertaking has blatantly violated the law and continued in possession of the suit property for 16 years beyond the term of its lease. We are indeed very sad to note that a Public Sector Undertaking has behaved in this manner. In this country the rule of law prevails and Public Sector Undertakings are subordinate to law and not above the law. In this case, the appellant which is a Public Sector Undertaking has taken the law into its own hands, which was most unfortunate and unjustified.?
15.The learned counsel appearing for the appellant relied upon the judgment of a learned Single Judge in the case of G.Mohamed Thajf v. The Bharat Petroleum Corporation Ltd., reported in 2001 (1) CTC 10 and submitted that this Court has even issued a Writ of Mandamus directing the Corporation to deliver possession of the property after the expiry of the lease on the ground that continuance of possession after expiry of lease pursuant to the statutory enactment cannot be considered as tenant holding over and that the lessee in such case should be ranked as trespassers. The above judgment was on the basis of the judgment of a Division Bench of this Court in the case of N.R.Vairamani v. Union of India reported in 2001 (1) CTC 1. It is to be noted that the judgment which was relied upon by the learned Single Judge namely 2001 (1) CTC 1 was taken on appeal before the Hon'ble Supreme Court and the judgment of the Division Bench was set aside and directions were issued to initiate proceedings only under the provisions of Tenants Act. The judgment of the Hon'ble Supreme Court in C.A.Nos.7467 of 2003 and 4463 of 2004 is reported in (2004) 8 SCC 579. In the said judgment, it has been held as follows:
?15.Section 9 confers a privilege on a tenant against whom a suit for eviction has been filed by the landlord but that privilege is not absolute. Section 9 itself imposes restriction on the tenant's right to secure conveyance of only such portion of the holding as would be necessary for his convenient enjoyment. It creates a statutory right to purchase land through the medium of court on the fulfillment of conditions specified in Section 9 of the Tenants Act. It is not an absolute right, as the court has discretion to grant or refuse the relief for the purchase of the land. In Swami Motor Transport (P) Ltd. v. Sri Sankaraswamigal Mull (1963 Supp (1) SCR
282) this Court considered the question whether the right of a tenant to apply to a court for an order directing the landlord to sell the land to him for a price to be fixed by it under Section 9 of the Tenants Act is a property right. The court held, that the law of India does not recognize equitable estates, a statutory right to purchase land does not confer any right or interest in the property. The right conferred by Section 9 is a statutory right to purchase land and it does not create any interest or right to the property. The tenant's right to secure only such portion of the holding as may be necessary for his convenient enjoyment is equitable in nature. Under the common law a tenant is liable to eviction and he has no right to purchase the land demised to him at any price as well as under
the Transfer of Property Act. The only right of a tenant who may have put up structure on the demised land is to remove the structure at the time of delivery of possession on the determination of the lease. Section 9 confers an additional statutory right to a tenant against whom suit for ejectment is filed to exercise an option to purchase the demised land to that extent only which he may require for convenient enjoyment of the property. The tenant has no vested right in the property instead; it is a privilege granted to him by the statute which is equitable in nature.
16.Whenever an application is made by a tenant before the court for issuance of direction to the landlord for the sale of the whole or part of the land to him, the court is under a mandatory duty to determine the minimum extent of the land which may be necessary for the convenient enjoyment by the tenant. This determination can obviously be made only after an enquiry is held by the court having regard to the area of the demised land and the extent of superstructure standing thereon, and the tenant's need for the land for the beneficial enjoyment of the superstructure which he may have constructed thereon. The enquiry presupposes that the tenant making the application has been in the occupation of the land and the superstructure wherein he may be either residing or carrying on business, and on his eviction he would be adversely affected. The policy underlying Section 9 of the Tenants Act is directed to safeguard the eviction of those tenants who may have constructed superstructure on the demised land, so that they may continue to occupy the same for the purposes of their residence or business. Section 9(1)(b) ordains the court to first decide the minimum extent of the land which may be necessary for the convenient enjoyment by tenant, it therefore contemplates that the tenant requires the land for the convenient enjoyment of the property. If the tenant does not occupy the land or the superstructure or if he is not residing therein or carrying on any business, the question of convenient enjoyment of the land by him could not arise. The court has to consider the need of the tenant and if it finds that the tenant does not require any part of the land, it may reject the application and direct eviction of the tenant, in that event the landlord has to pay compensation to the tenant for the superstructure.
17.The above position was highlighted in P. Ananthakrishnan Nair and Anr. v. Dr. G. Ramakrishnan and Anr. (1987 (2) SCC 429).
18.In paragraphs 4 and 8 of Hindustan Petroleum Corporation v. Raja D.V. Appa Rao Bahadur (1995 Supp (3) SCC 397) the nature of right on the successor of a tenant has been indicated. The effect of the acquisition on the operation of the Transfer of Property Act, 1882 have been dealt with in detail by a three- Judge Bench of this Court in Bharat Petroleum Corporation Ltd. v. P. Kesavan and Anr. (2004 (9) SCC 772). The application and relevance of these decisions shall be considered in case the landlord moves the appropriate Court and initiate proceedings as prescribed under the Tenants Act. The impugned judgment of the Division Bench of the High Court is indefensible and is set aside. It is made clear that what would be the position if the proceeding is taken under the Tenants Act, shall be decided by the appropriate Court.?
16.In view of the authoritative pronouncement of the Hon'ble Supreme Court in the case above referred to, the judgment of the Division Bench of this Court reported in 2001 (1) CTC 1 is not a good law and it cannot be a precedent to submit that landlord in a case of this nature can even seek eviction by filing a Writ Petition without a suit before the competent Court.
17.However, on the basis of the other judgments relied upon by the learned counsel for the appellant, it was reiterated that the appellant should be granted relief of recovery of possession in the present proceedings without dragging the appellant to file a fresh suit for recovery of possession.
18.The learned counsel appearing for the appellant was very much on the issue to mould the relief not only to shorten the litigation but also to render justice between the parties by taking into consideration the subsequent events. It was further submitted by the learned counsel for the appellant that the power under Section 151 of C.P.C is to protect the interest of parties particularly to those whose rights are belittled or being deprived of by the long pendency of the proceedings before the Civil Court.
19.On the contrary, the learned counsel appearing for the respondent after referring to the agreement under Ex.A8 submitted that the terms of the contract in Ex.A8 are not unconscionable and absolutely there is no basis to sustain the argument of the learned counsel for the appellant that the lease agreement under Ex.A8 is invalid and non-est. It was further submitted that the suit itself came to be filed only in the year 1998 after a long period from the date of lease agreement. Since there is no specific allegation of fraud, impersonation, or undue influence, the learned counsel appearing for the respondent submitted that the plea that the lease agreement is void and unenforceable cannot be entertained.
20.The learned counsel appearing for the respondent referred to the averments in the plaint and submitted that the suit itself is not maintainable in view of the statutory right of renewal in favour of the original lessee and the right of the defendant to step into the shoes of original lessee to claim the statutory benefits.
21.With regard to the submissions made on behalf of the appellants about the power of Court to mould the relief, the learned counsel for the respondent contended that this plea was never raised by the appellant before the Court below. The respondent, as per the terms of the lease deed, is entitled to a statutory renewal apart from the right to purchase the suit property. He also submitted that the respondent also is entitled to the right under the City Tenants Protection Act. Since the suit itself was filed at the time when there was no cause of action for the suit in view of the statutory renewal of lease in favour of the respondent, there were no scope for any plea by the respondent claiming relief under the provisions of City Tenants Protection Act before the trial Court. Hence, the grant of relief, assuming that the respondent as an ordinary tenant without giving an opportunity to the respondent to claim the benefit of City Tenants Protection Act is inequitable and opposed to law. In other words, the learned counsel appearing for the respondent seriously contested that the respondent is entitled to the benefits of the City Tenants Protection Act and that the respondent cannot be deprived of such benefit of claiming certain privileges and rights under the City Tenants Protection Act. The learned counsel appearing for the respondent relied upon a judgment of this Court in the case of Arunachalam Pillai v. Ramu Mudaliar and others reported in 1998 (II) CTC 146 wherein it has been held as follows:
?14. It is clear from the above decisions, that the jurisdiction of the Court to grant a relief must be based on pleadings or at least the opposite party must have admitted the right of the plaintiff in respect of the portion of the same. In this case, both the plaintiff and 1st defendant claimed exclusive title. There is no alternative case for either of the parties. The 1st defendant has also not filed any counter claim and he has filed only written statement denying the right of the plaintiff. He claim exclusive right only as a defence to the plaintiffs claim and what he prayed for is only the dismissal of the suit. The question whether the plaintiff and defendant are entitled to equal right over the suit lane was not a matter in issue nor evidence let in that regard. Only because the suit lane lies in between the properties of the plaintiff and the 1st defendant, the Lower Appellate Court though that it has been commonly enjoyed by both of them. When the parties are not at issue and the relief granted by the lower Appellate Court is neither incidental to the main relief, following the decisions cited supra, I think that the relief granted was in excess of its jurisdiction. The relief does not flow either from the plaint claim or on the basis of any admission of the defendants. In such cases, the Court cannot grant a relief, as has been granted by the lower Appellate Court. Consequently, the first substantial question of law raised in the Second Appeal has to be found in favour of the appellant. The lower Appellate Court has no jurisdiction to grant a declaration that the plaint lane is a common lane. On question No.2, it has to be held that when there is a finding that the plaintiff has failed to establish his case, it can only dismiss the suit and cannot grant a decree as has been done in this case. On question No.3, I hold that such question does not arise for consideration, since the suit has only to be dismissed.?
22.The learned counsel appearing for the respondent relied upon a catena of judgments particularly an unreported judgment of the Hon'ble Supreme Court in the case of Hindustan Petroleum Corporation Ltd., v.
C.S.Narendran in C.A.No.1001 of 2010. The Hon'ble Supreme Court in the above case considering Section 9(3) and Section 7(3) of Act 17/1974 held that in similar cases the Corporation which are successors in interest of the erstwhile foreign company are entitled to statutory renewal.
23.Having regard to the specific provisions of Act 17/1977, the respondent is entitled to a statutory renewal of 20 years and this fact is not seriously disputed. However, it was submitted by the learned counsel for the respondent that the question whether the respondent was entitled to the benefit of City Tenants Protection Act was not gone into earlier at the time of trial. Hence, the learned counsel appearing for the respondent submitted that without giving an opportunity to the respondent to prove its entitlement under the provisions of the City Tenants Protection Act, this new plea cannot be entertained.
24.On a perusal of records, this Court is of the view that the question whether the respondent is entitled to the benefits of City Tenants Protection Act was neither raised nor answered. Having regard to the nature of the averments found in the plaint, the question about the eligibility of the respondent claiming benefits under the provisions of City Tenants Protection Act did not arise.
25.The learned counsel for the appellant relied upon a judgment of the Division Bench of this Court in the case of M/s.Bharat Petroleum Corporation Limited v. R.RAvikrishnan and another reported in 2011-4-LW-385 wherein this Court has held in paragraph 29 as follows:
?29. In order to invoke the provisions of Section 2(4)(ii)(b), a tenant in respect of land under a tenancy agreement to which the City Tenants' Protection Act is made applicable under sub-section (3) of Section 1 must prove that he or any of his predecessors in interest had erected any building on such land and continues to be in actual physical possession of such land and building. Sub-section (3) of Section 1 defines the applicability of the City Tenants' Protection Act to certain areas. Further, in order to avail the provisions of the said section, the tenant should continue in actual physical possession of the land and building. As the Supreme Court has already held that actual physical possession is a pre-
condition for a tenant to invoke the provisions of Section 9, an argument was advanced stating that the provisions of Section 2(4)(ii)(a) does not use the words 'actual physical possession' and therefore it is not mandatory for a tenant to be in actual physical possession of the land to invoke Section 9. We do not find any force in the said contention in view of the judgment of the Supreme Court in S.R.Radhakrishnan's case. As to the words 'continues in possession' of the land employed in Section 2(4)(ii)(a) are concerned, in our opinion, the word 'possession' should only mean actual physical possession of the land and building. That Section should be read along with Section 3, which empowers a tenant to seek for payment of compensation for such land. That Section provides that a tenant shall on ejectment be entitled to be paid compensation the value of any building which may have been erected by him, by any of his predecessors in interest or by any person not in occupation at the time of ejectment who derived title from either of them and for which compensation has not already been paid. For a landlord to file a petition for ejectment, the tenant must be in actual physical possession. An argument was sought to be advanced on behalf of the oil Companies that since the provisions of Section 3entitle the tenant to claim compensation in respect of the building which have been erected by them or any of their predecessors in interest and the building in the land in question have been erected by the tenants before the acquisition Act was passed, they are entitled to make an application under Section 9, as they are entitled to compensation under Section 3. This argument cannot be accepted for the simple reason that by the acquisition Act the oil Companies only acquired the leasehold rights of the erstwhile companies which would not include the right of the person who put up superstructure unless the companies are in actual physical possession of the land and building. In this case, the oil Companies could claim only legal possession of the land, as the superstructures had been erected by the licensees who had been granted licenses by the oil Companies. In that sense, the provisions of Section 2(4)(ii)(a)should be read only in that way, namely, that when the provision employs the words 'continues in possession', it should mean actual physical possession which is sine quo non for a tenant to claim compensation under Section 3 of the Act.?
26.From the above judgment, the argument of the learned counsel for the appellant is that the respondent is not in physical possession of the property and that therefore is not entitled to the benefits of the provisions of City Tenants Protection Act.
27.As against the submission of the learned counsel for the appellants, the learned counsel for the respondent submitted that these contentious issues based on facts cannot be entertained at this stage.
28.The learned counsel for the appellant further relied upon a judgment of a Single Judge of this Court in the case of Hindustan Petroleum Corporation Limited v. B.S.Ojeeha reported in 2011 (1) MWN (Civil) 387. The view expressed by the Hon'ble Division bench of this Court was also reiterated by the learned Single Judge of this Court in the above case.
29.Having regard to the peculiar facts and circumstances of this case, this Court is also of the view that this Court under normal circumstances cannot deal with the issue whether the defendant/respondent is in actual physical possession of the property or not in second appeal. However, the respondent corporation is in possession for more than 44 years. From 1993, the same old rent fixed in 1973 is being paid. Great prejudice has been caused to the plaintiff by virtue of the statutory renewal. The respondent corporation has now been recognised as a commercial organization functioning as an independent establishment having several dealers and bunks in this country. As it has been held by the Division Bench of this Court in 2005 (2) CTC 401 that the respondent corporation is expected to surrender possession after the expiry of the lease. However, in this case, the respondent further claims rights under Madras City Tenants' Protection Act after the expiry of the lease. On the determination of lease upon the expiry of the period, the lessee's right of possession of the property comes to an end in other cases. However, the respondent's right under the provisions of Madras City Tenants' Protection Act, 1921, stated to be surviving in view of the definition of the term tenant under the Act to claim the benefits. However, it is submitted by the learned counsel for respondent that the respondent is not in physical possession of the property to claim the benefits of State legislation. But the issue was never considered as it did not arise for consideration before the Courts below. However, the appellate Court, while exercising its appellate jurisdiction would be entitled to take into consideration the subsequent events for the purpose of moulding the relief. This is well recognised on the interpretation of Order 7, Rule 7 C.P.C. read with Order 41, Rule 33 of C.P.C. to shorten litigation and attain ends of justice.
30.It has been held by the Hon'ble Supreme Court in the case of Surinder Kumar and others v. Gian Chand and others reported in AIR 1957 SC 875 that it is necessary to take the subsequent fact into consideration at the time of deciding the appeal. In this case, the Hon'ble Supreme Court has relied upon the judgment of Federal Court in Lachmeshwar Prasad Shukul v. Keshwar Lal Chaudhari reported in AIR 1941 FC 5 and the following passage is quoted with approval:
"We have frequently held that in the exercise of our appellate jurisdiction we have power not only to correct error in the judgment under review but to make such disposition of the case as justice requires. And in determining what justice does require, the court is bound to consider any change, either in fact or in law, which has supervened since the judgment was entered."
31.Again in the case of M.Lakshmi and Co v. Dr.Anant. R. Deshpande and another reported in AIR 1973 SC 171, the Hon'ble Supreme Court has held as follows:
?27. ... These cases are where the court finds that because of altered circumstances like devolution of interest it is necessary to shorten litigation. Where the original relief has become inappropriate by subsequent events, the Court can take notice of such changes. If the court finds that the judgment of the Court cannot be carried into effect because of change of circumstances the Court takes notice of the same. If the Court finds that the matter is no longer in controversy the court also takes notice of such event. If the property which is the subject matter of suit is no longer available the Court will take notice of such event. The court takes notice of subsequent events to shorten litigation, to preserve rights of both the parties and to subserve the ends of justice.?
32.The Hon'ble Supreme Court in the case of Atma S. Berar v. Mukhtiar Singh reported in AIR 2003 SC 624 acknowledged the power of appellate Court to take note of subsequent events as a well settled and undoubted proposition.
33.In the case of Ramesh Kumar v. Kesho Ram reported in AIR 1992 SC 700, the Hon'ble Supreme Court held as follows:
?6. The submissions of learned Counsel are only partly correct. While it is true that a distinction must be made between pleading and proof, the further submissions that these must necessarily be in two successive sequential stages need not always be so and particularly when dealing with pleas of subsequent events in appeals and revisions. If the allegations of facts made in support of such a plea are denied then alone the question of their proof in an appropriate way arises. If those allegations of facts are admitted, there is no need to prove what is admitted or must be deemed to be admitted. There can be admissions by non-traverse. The High Court proceeded to accept the allegations as proved presumably in view of the fact that appellant's learned Counsel did not even appear, let alone challenge the allegations. But there might also be cases in which, having regard to the nature of the circumstances, the Court may insist upon proof independently of such admission by non-traverse.
When subsequent events are pleaded in the course of an appeal or proceedings of revision, the Court may, having regard to the nature of the allegations of fact on which the plea is based, permit evidence to be adduced by means of affidavits as envisaged in Rule 1 of Order 19, C.P.C. The Court may also treat any affidavit filed in support of the pleadings itself as one under the said provision and call upon the opposite side to traverse it. The Court, if it finds that having regard to the nature of the allegations, it is necessary to record oral evidence tested by oral cross-examination, may have recourse to that procedure. It may record the evidence itself or remit the matter for an enquiry and evidence. All these depend upon the factual and situational differences characterising a particular case and the nature of the plea raised. There can be no hard and fast rule governing the matter. The procedure is not to be burdened with technicalities.?
34.Again in the case of Mohanlal v. Tribhovan reported in AIR 1963 SC 358, the Constitutional Bench of Supreme Court has reiterated the duty of appellate Court to decide the appeal having regard to the subsequent events or change of law and para 7 of the judgment is extracted below:
?7.It would thus appear that when the matter was still pending in the Court of Appeal, the judgment of the lower Appellate Court being dated September 27, 1954, the notification cancelling the previous notification was issued. The suit had, therefore, to be decided on the basis that there was no notification in existence under s.88(1)(d), which could take the disputed lands out of the operation of the Act. This matter was brought to the notice of the learned Assistant Judge, who took the view that though, on the merger of Baroda with Bombay in 1949, the defendants had the protection of the Act, that protection had been taken away by the first notification' which was cancelled by the second. That Court was of the opinion that though the Appellate Court was entitled to take notice of the subsequent events, the suit had to be determined as on the state of facts in existence on the date of the suit, and not as they existed during the pendency of the appeal. In that view of the matter, the learned Appellate Court held that the tenants- defendants could not take advantage of the provisions of the Act, and could not resist the suit for possession. In our opinion, that was a mistaken view of the legal position. When the judgment of the lower Appellate Court was rendered, the position in fact and law was that there was no notification under cl.(d) of s.88(1) in operation so as to make the land in question immune from the benefits conferred by the Tenancy Law. In other words, the tenents could claim the protection afforded by the law against eviction on the ground that the term of the lease had expired. But it was argued on behalf of the appellants that the subsequent notification, cancelling the first one, could not take away the rights which had accrued to them as a result of the first notification. In our opinion, this argument is without any force. If the landlords had obtained an effective decree and had succeeded in ejecting the tenants as a result of that decree, which may have become final between the parties, that decree may not have been re-opened and the execution taken thereunder may not have been recalled. But it was during the pendency of the suit at the appellate stage that the second notification was issued canceling the first. Hence, the Court was bound to apply the, law as it was found on the date of its judgment. Hence, there is no question of taking away any vested rights in the landlords. It does not appear that the second notification, canceling the first notification, had been brought to the notice of the learned Single Judge, who heard and decided the second appeal in the High Court. At any rate, there is no reference to the second notification. Be that as it may, in our opinion, the learned Judge came to the right conclusion in holding that the tenants could not be ejected, though for wrong reasons. The appeals are accordingly dismissed, but there would be no order as to costs in this Court, in view of the fact that the respondents had not brought the second notification cancelling the first to the pointed attention of the High Court.?
35.In a subsequent judgment of Hon'ble Supreme Court, in the case of Shadi Singh v. Rakha reported in AIR 1994 SC 800 it has been held as follows:
?7.It is settled law that subsequent events can be taken note of and the relief would be moulded suitably, vide Hasmat Rai and Anr. v. Raghunath Prasad, [1981] 3 SCR 605 and M/s Variety Emporim v. V.R.M. Mohld. Ibrahim Naina [1985] 2 SCR 102 at 110. Therefore, the appellate authority (District Court) is well justified in its conclusion that the cause of action for eviction of the appellant no longer subsisted after the tenant effected repairs and replaced that part of the fallen roof and the order of eviction, thereafter became unnecessary and wrong.?
36.Having regard to the principles reiterated by Hon'ble Supreme Court, the fact that the lease has come to an end in 2013 can be taken into account in this case to sustain the suit in order to shorten the litigation and to secure the ends of justice. The right of respondent to claim the benefits of City Tenants Protection Act can be considered only if the respondent proves that it is in physical possession and not through a dealer or agent. It is true that an opportunity should be given to the respondent that it is entitled to the rights conferred under the Madras City Tenants Protection Act by proving the fact that the respondent is in actual physical possession as on the date when the suit was filed for possession.
37.The object of Madras City Tenants' Protection Act, 1921, was also to protect the tenants who have put up permanent construction spending amounts, several times the value of land and to avoid demolition of buildings put up by tenants in cities. Section 11 of Madras City Tenants' Protection Act, 1921, contemplates a pre-suit notice at least three months prior to the institution of suit. Issuance of notice under Section 11 is mandatory. Under Section 9, a tenant who is entitled to compensation under Section 3 and against whom a suit in ejectment has been instituted may apply to the Court for an order directing the landlord to sell the land for a price to be fixed by Government. As per Section 3 of Madras City Tenants' Protection Act, every tenant is entitled to be paid as compensation the value of any building which might have been erected by him or by his predecessors in interest. The term tenant is defined under Section 2(4) of the Act and it is extracted below for convenience:
"2(4) "Tenant" in relation to any land :-
(i)means a person liable to pay rent in respect of such land, under a tenancy agreement express or implied, and
(ii)includes -
(a) any such person as is referred to in sub-clause (i) who continues in possession of the land after the determination of the tenancy agreement,
(b)any person who was a tenant in respect of such land under a tenancy agreement to which this Act is applicable under sub-section (3) of Section 1 and who or any of his predecessors in interest had erected any building on such land and who continues in actual physical possession of such land and building, notwithstanding that"
(a) any such person as is referred to in sub-clause (i) who continues in possession of the land after the determination of the tenancy agreement,
(b) any person who was a tenant in respect of such land under a tenancy agreement to which this Act is applicable under sub-section (3) of section 1 and who or any of his predecessors in interest had erected any building on such land and who continues in actual physical possession of such land and building, notwithstanding that -
(1) such person was not entitled to the rights under this Act by reason of the proviso to Section 12 of this Act as it stood before the date of the publication of the Madras City Tenants' Protection (Amendment) Act, 1972 (Tamil Nadu Act 1 of 1972), or (2) a decree for declaration or a decree or an order for possession or for similar relief has been passed against such person on the ground that the proviso to section 12 of this Act as it stood before the date of publication of the Madras City Tenants'' Protection (Amendment) Act, 1972 (Tamil Nadu Act 4 of 1972 ) disentitled such person from claiming the rights under this Act, and
(c) the heirs of any such person as is referred to in sub-clause (i) or sub- clause (ii) (a) or (ii) (b);
But does not include a sub-tenant or his heirs."]
38.Considering Section 2(4) and Section 3 of the Act, the Hon'ble Supreme Court, in S.R.Radhakrishnan and others v. Neelamegam, reported in 2003 (10) SCC 705 held that actual physical possession of the demised premises of the tenant is a sine quo non to an application under Section 9 of the Act. The position is also reiterated by the Division Bench of this Court in Bharat Petroleum Corporation Ltd., v. R.Ravikrishnan and another reported in 2011 4-L.W. 395. The Hon'ble Supreme Court and the Division Bench of this Court in the judgments referred to above made the position clear that the word 'possession' should only mean actual physical possession of the land and building and that oil companies who may be in legal possession but not in physical possession are not entitled to file an application under Section 9 of Madras City Tenants' Protect Act. Though it is stated in this case that the respondent had appointed a dealers and it is the dealer appointed by the respondent is in actual possession, the respondent did not produce any material to controvert such assertion. Further, the learned counsel appearing for the respondent submitted that the issue whether the corporation need to prove physical possession in order to seek relief under Section 9 of the Act has been referred to a larger Bench of Hon'ble Supreme Court. This gives an indication that the respondent is not in physical possession. However, the learned counsel for respondent raised a legal plea that a factual issue cannot be entertained at this stage.
39.The respondent is a public sector undertaking and hence, expected to be fair in dealing with citizens. In this case, on behalf of respondent, the first grade sales officer of the respondent corporation by name Jaganathan was examined as D.W.2. During cross-examination, he admits that a dealer by name Shanmugavel is running the retail outlet and paying rent depends upon sale and that he is paying between Rs.5,000/- and Rs.7,000/- as rent. The following portion of the evidence is relevant and hence, extracted below:
?ng;bghGJ jhth nlj;jpy; ^&z;KfBty; ehlhh; vd;gth; jhd; itj;J elj;Jfpwhh;/ me;j &z;KfBty; ehlhh;jhd; gpujpthjpapd; fk;bgdpapd; Oyuhf nUf;fpwhh;. gpujpthjpf;F khj thlif brYj;Jfpwhh;. rz;Kf ehlhh; ne;j nlk; rk;ge;jkhf gpujpthjpapd; 2brd;dp my;y. mth; gpujpthjpf;F khjkhjk; brYj;Jk; bjhif bglBuhy; thA;Fk; bjhiff;F bghWj;jJ. Ruhrhpahf khjk; xd;Wf;F U.5,000/- =Kjy; U.7,000/- tiu brYj;jp tUfpwhh;.?
40.Thus, it is evident that the respondent is not in physical possession of the retail outlet. The admission is unambiguous to the effect that the respondent is not in physical possession. Despite positive admission, the learned counsel for the respondent did not come up with any explanation at least by taking a stand that the respondent has taken possession subsequently. Though this Court originally thought of remitting the matter to give an opportunity to the respondent, in the interest of justice, this Court is able to see that such exercise will be futile. Having regard to the categorical admission regarding the status of respondent corporation, this Court is of the view that it will be unfair to prolong the case further and no useful purpose will be served. Since this Court concluded that the respondent is not in physical possession, there is no scope for respondent claiming the benefits of Section 3 or Section 9 of Madras City Tenants' Protection Act. Hence, this Court allow this Second Appeal and set aside the judgment and decree of the Courts below. As a result, the Suit in O.S.No.606 of 1993 on the file of the First Additional Sub Court, Madurai, is partly decreed. The respondent is directed to deliver vacant possession of the plaint schedule property to the appellants, the legal representatives of the plaintiff, within a period of three months. The respondent is further directed to pay the appellants, a sum of Rs.12,000/- towards past mesne profits and further sum calculated at the rate of Rs.7,000/- from the date of plaint till the expiry of the lease period in 2013. After the expiry of the lease in 2013, the appellants are entitled to collect future mesne profits for use and occupation of the demised premises which shall be determined for every month till possession is delivered to the appellants and this Court direct an enquiry under Order 20, Rule 12 of Civil Procedure Code and the respondent is liable to pay the amount as may be determined by the lower Court under Order 20, Rule 12 of Civil Procedure Code. No costs.
To
1.The Principal District Judge, Madurai.
2.The First Additional Sub Judge, Madurai
3.The Section Officer, Vernacular Records, Madurai Bench of Madras High Court, Madurai.
.