Wednesday, 15 August 2018

Whether court should order eviction of tenant on ground of compromise if ground for eviction is not made out?

The common thread that runs through the aforesaid pronouncements
of this Court is – in cases where protection under a Rent Act is available, no
eviction can be ordered unless ground seeking eviction is made out, even if
parties had entered into a compromise. Moreover, the invalidity on that
count can even be raised in execution. In the present case, the order dated
28.03.2014 did not remotely note that any particular ground under the Rent
Act was made out.
15. In the circumstances, in our considered view, the order passed by the
appellate court was absolutely correct and did not call for any interference on part of the High Court.

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOs. 8256-8257 OF 2018

M/s Alagu Pharmacy & Ors. N. Magudeswari 

Uday Umesh Lalit, J.
Dated:August 14, 2018.

Leave granted.
2. This appeal is directed against the final judgment and order dated
29.03.2016 in Civil Revision Petition (NPD) No.586 of 2016 as well as
against the order dated 02.12.2016 in Review Petition No.89 of 2016 in said

Civil Revision Petition (NPD) No.586 of 2016 passed by the High Court of
Judicature at Madras, Bench at Madurai.
3. The appellants 2 to 4 are doing business in the name and style of M/s
Alagu Pharmacy i.e. the appellant No.1. The appellants claim to be tenants
in the suit property owned by the respondent herein since 1998. On or about
22.02.2012 a lease agreement was entered into, which according to the
appellants was signed by the respondent, extending/renewing the period of
lease. On 13.11.2013 and 07.12.2013 the respondent had issued legal
notices calling upon the appellants to vacate the suit property alleging inter
alia that the lease agreement dated 22.02.2012 was not signed by the
respondent and was a forged document, to which reply was given by the
appellants on 17.01.2014. On 17.01.2014 itself a complaint (Exh.P-10) was
lodged by the respondent alleging commission of forgery. According to the
appellants, on 20.01.2014 the respondent alongwith her husband and some
henchmen tried to evict the appellants which attempt was successfully
resisted by the appellants. In the circumstances, O.S. No.135 of 2014 was
filed by the appellants on 21.01.2014 seeking relief of permanent injunction
against the respondent from interfering with their peaceful possession and
enjoyment of the suit property save and except by due process of law. After
3
hearing the appellants, an ad interim injunction was granted by the District
Munsif, Coimbatore.
4. It appears that on 29.01.2014 a compromise (Exh.P-11) was entered
into between the appellants and the respondent. It is the case of the
appellants that they were summoned to the police station in connection with
the complaint lodged by the respondent (Exh.P-10) and under the pressure
employed by the police, said Exh. P-11 was entered into. Soon thereafter an
Eviction Petition i.e. R.C.O.P. No.29 of 2014 was filed by the respondent
before the Principal Rent Controller-cum-District Munsif, Coimbatore for
eviction of the appellants. It is the case of the appellant that they were again
asked to appear before the police on 27.03.2014 and under the pressure
exerted by the police a compromise deed was entered into under which the
appellants agreed to vacate the suit property. Said compromise deed was
presented before the Court on 28.03.2014 and following order was passed
by the Rent Controller and Principal District Munsif, Coimbatore:
“Petition dated 08.02.2014 filed under Section 10(2)(ii)(a),
10(3)(c) of Tamil Nadu Buildings (Lease and Rent Control)
Act, 1960 and the petitioner filed this petition against the
respondents to vacate the premises and to deliver the vacant
possession of the petition mentioned property more fully
described hereunder in the schedule and cost of this petition.
4
This petition coming on this day for hearing before me in
the presence of Thiru. M. Sanjaiyan, Advocate for petitioner
and of Thiru. Somasundaram, Advocate for respondent. Both
parties filed compromise memo and both parties present and
this day this Court doth order direct as follows:
1. That the respondents be and are hereby granted
time upto 31.10.2015 to vacate the petition
mentioned property and to handover the vacant
possession of the same to the petitioner/landlord
and
2. That the respondents are hereby directed to pay
the present monthly rent of Rs.19080/- pm to the
petitioner/landlord till the date of delivery of
possession of the property (i.e. upto 31.10.2015)
by way of cheque; and
3. That in case of default to do so by the
respondents, the petitioners are entitled to take
appropriate action through court of law against the
respondents.
4. The compromise petition do form part of this final
order, and
5. That there be no order as to cost.”
5. On 07.10.2015, a letter was sent by the respondent calling upon the
appellants to vacate the premises by 31.10.2015 in terms of the aforesaid
compromise decree. On 07.12.2015, an appeal being R.C.A. (CFR)
No.31591 of 2015 was filed by the appellants before the Principal
Subordinate Judge, Coimbatore against the aforesaid compromise decree
5
dated 28.03.2014. Along with said appeal IA No.465 of 2015 was also
preferred seeking condonation of delay of 604 days in filing said appeal.
6. The respondent having contested the matter, said IA No.465 of 2015
was taken up for consideration by the appellate court. It was submitted on
behalf of the appellants that they were pressurized into signing the
compromise deed and said compromise was brought about because of
pressure exerted by the police. Reliance was placed on complaint Exh.P-10
by the respondent and compromise letter Exh.P-11 dated 29.01.2014. On
the other hand, it was submitted on behalf of the respondent that there were
numerous occasions for the appellants to raise a grievance that the
compromise in question was brought about by coercion and yet no such
objection was ever raised. It was, therefore, submitted that the delay of 604
days in preferring the appeal ought not to be condoned.
7. The appellate court by its Order dated 19.01.2016 accepted said IA
No.465 of 2015 and condoned the delay subject to payment of Rs.2000/- by
the appellants to the respondent. It was observed by the appellate court as
under:
6
“8. The main contention of the respondent is compromise
made before the trial court with free will and now the
respondent is tried to drag on the matter and preventing the
respondent from enjoying the fruit source of the compromise
decree. On the side of respondent Ex.R1 and R4 marked.
Ex.R1 compromise memo; R2 document for already received
the certified copy of fair and final order; R3 letter from the
respondent to the petitioner; R4 postal acknowledgement. On
perusal of respondent side documents to disprove the facts of
Ex.P-10 and Ex.P-11 no documents have been filed. The
landlord-tenant relationship is admitted. The allegations made
by the respondent against the petitioners is lease deed dated
22.02.2012 is forged one and complaint has been given to the
police regarding the forged documents and the petitioners
themselves come to the agreement they are undertake to vacate
the petition mentioned property, there is no police threat or
complaint or coercion by the police or by the respondent. In
order to consider the documents filed by the petitioners Ex.P-10
is the police complaint, prepared by the respondent
Magudeswari against the 2nd petitioner/appellant. In the
complaint the allegations made against the 2nd petitioner is that
there is life threat to the respondents and the lease deed has
been created by the 2nd petitioner by forging the signature of the
respondent and requesting the police to take proper legal action
against the 2nd petitioner. Once the written complaint filed
before the police mentioning the name of the accused, if the
police finds it is true for that police have to register FIR against
the accused and proceed with the investigation as per law. But
on perusing of Exh.P-11 compromise letter dated 29.01.2014
between the respondent and the 2nd petitioner addressing to the
inspector of police, City Crime Branch. In continuation the
RCOP has been filed and memo of compromise filed,
compromise decree has been passed. As stated above the duty
of the police is only to register the case against the accused and
proceed against the accused for the offence committed for the
crime, they are not entitled to make any compromise against the
crime unless and until it is provided by law and further before
when compromise arrived at court, the previous compromise
has been arrived at police station. From Ex.P-11 itself there
7
arises suspicion whether the petitioner has put into any force or
any threat to make the compromise before the court. Hence
from the above discussions there is a police force with regard to
file the compromise regarding RCOP 29/14 and previously
compromise letter has been arrived before the police. Hence
there is a suspicion arises petitioner must be put into any threat
or coercion at the time of filing the compromise memo in
RCOP and now the petitioner filed the petition to condone the
delay of 604 days. Hence from the above discussions it is clear
the petitioners have explained the delay of 604 days in filing the
appeal and the explanation submitted by the petitioners is
acceptable one.”
8. The aforesaid order was challenged by the respondent by preferring
Civil Revision Petition before the High Court of Judicature at Madras which
Revision Petition was allowed by the High Court vide its orders dated
29.03.2016. It was observed by the High Court as under:
“5. There are two courses open to the tenants. One is that the
tenants would have stated before the Court which recorded the
compromise that the compromise was out of compulsion or
coercion on the part of the police during enquiry of the
complaint preferred by the landlady. In that case, the Court
which recorded the compromise would have dealt with that
issue. That is not the case here. When that is not the case, it is
far fetched for the appellate court to come to a conclusion that
the tenants might have been put into coercion or force before
entering into the compromise. It is equally probable that in
order to get the closure of complaint, the tenants would have
opted to enter into a compromise and thereafter, the tenants are
put forth an allegation of invalidity of compromise. Even if the
tenants had some difficulty in expressing themselves before the
trial court, the appeal would have been filed immediately after
the compromise decree, if there had been any vitiating factors
8
while entering into the compromise. But, the appeal had not
been filed in time. Therefore, the conduct of the tenants would
only indicate the procrastinating approach in dealing with their
case.”
9. The appellants preferred a review petition which was rejected by the
High Court on 02.12.2016. This appeal challenges the correctness of both
the orders passed by the High Court. We heard Mr. Ratnakar Dash, learned
Senior Advocate for the appellants and Mr. S. Thananjayan, learned
Advocate appearing for the respondent.
10. The order passed by the appellate court shows that compromise
Exh.P-11 was brought about on 29.01.2014 that is even before the eviction
petition was filed by the respondent. Further, said compromise Exh.P-11
was addressed to the Inspector of Police, City Crime Branch. The appellate
court had further observed that complaint Exh.P-10 and compromise Exh.P-
11 were not disputed by the respondent and no document in rebuttal was
filed. The complaint (Exh.P-10) proceeds on a premise that the lease deed
dated 22.02.2012 was a forged document and there was no relationship of
landlord-tenant between the parties. Yet an eviction petition was filed,
seeking eviction of the appellants under the concerned Rent Act. There is an
inherent contradiction in the stand adopted by the Respondent. In the
9
circumstances, the assertion made by the appellants that pressure was
exerted through the police and they were compelled to enter into
compromise is prima facie acceptable. In Ajad Singh v. Chatra and
Others1, compromise recorded in Police Station inter alia was not found to
be acceptable by this Court and the matter was remanded. It was observed,
“…..the appellate court ought to have taken note of the fact that the said
compromise was recorded in the Police Station and during the pendency of
the suit.” It is true that there was a delay of 604 days in filing the appeal, but
in cases where there is reasonable doubt that police may have forced a party
to enter into compromise, the process of Court ought to weigh in favour of a
party who alleges to be victim of such pressure. It may be pertinent to note
that the order passed by the High Court does not even deal with this aspect
nor was any submission made that the assessment made by the appellate
court was in any way incorrect or imperfect.
11. Further, eviction petition was filed seeking eviction of the appellants
under Section 10(2)(ii)(a), 10(3)(c) of Tamil Nadu Buildings (Lease and
Rent Control) Act, 1960. Said Sections are as under:
1 (2005) 2 SCC 567 (para 8)
10
“10(2) A landlord who seeks to evict his tenant shall apply to
the Controller for a direction in that behalf. If the Controller,
after giving the tenant a reasonable opportunity of showing
cause against the application, is satisfied-
…….
(ii) that the tenant has after the 23rd October 1945
without the written consent of the landlord-
(a) transferred his right under the lease or sublet the
entire building or any portion thereof, if the lease
does not confer on him any right to do so, or
…..
.….
(3) …….
(c) A landlord who is occupying only a part of a
building, whether residential or non-residential, may,
notwithstanding anything contained in clause (a),
apply to the Controller for an order directing any
tenant occupying the whole or any portion of the
remaining part of the building to put the landlord in
possession thereof, if he requires additional
accommodation for residential purposes or for
purposes of a business which he is carrying on, as the
case may be.”
12. The eviction in terms of the aforesaid provisions can be ordered only
if the concerned Rent Controller or Court is satisfied that the ground seeking
eviction is made out. It has been held by this Court that unless and until
ground seeking eviction in terms of the concerned contract is not made out,
11
no eviction of a tenant can be ordered, even if the parties had entered into a
compromise. For example, in K.K. Chari v. R.M. Seshadri2 this Court
considered its earlier decisions in three cases as under:-
“20. There are three decisions of this Court which require to be
considered. In Bahadur Singh v. Muni Subrat Dass3 a decree
for eviction passed on the basis of a compromise between the
parties, was held, by this Court, to be a nullity as contravening
Section 13(1) of the Delhi and Ajmer Rent Control Act, 1952.
The facts therein were as follows:
“The tenant and the son of the landlord referred the
disputes between them to arbitration. The landlord was
not a party to this agreement. The arbitrators passed an
award whereunder the tenant was to give vacant
possession of the premises in favour of the landlord
within a particular time. This award was made a decree
of court. The landlord, who was neither a party to the
award nor to the proceedings, which resulted in the
award being made a decree of court, applied for eviction
of the tenant on the basis of the award. The tenant
resisted execution by raising various objections under
Section 47 of the Code of Civil Procedure. One of the
objections was that the decree for eviction based upon the
award was a nullity as being opposed to the Delhi and
Ajmer Rent Control Act, 1952. This Court held that the
decree directing the tenant to deliver possession of the
premises to the landlord was a nullity, as it was passed in
contravention of Section 13(1) of the relevant statute.
After quoting the sub-section, this Court further held that
the decree for eviction passed according to an award, in a
proceeding to which the landlord was not a party and
without the court satisfying itself that a statutory ground
of eviction existed, was a nullity and cannot be enforced
2 (1973) 1 SCC 761
3 (1969) 2 SCR 432
12
in execution. It will be seen from this decision that the
decree was held to be a nullity because the landlord was
not a party thereto, and also because the court had not
satisfied itself that a ground for eviction, as required by
the statute, existed. This decision is certainly an authority
for the proposition that a court ordering eviction has to
satisfy itself that a statutory ground of eviction has been
made out by a landlord. How exactly that satisfaction is
to be expressed by the court or gathered from the
materials, has not been laid down in this decision, as this
court was not faced with such a problem.”
21. In Kaushalya Devi v. Shri K.L. Bansal4 the question again
rose under the same Delhi statute regarding the validity of a
decree passed for eviction on compromise. The plaintiff therein
filed a suit for eviction of the tenant on two grounds—
(a) the premises were required for their own use; and
(b)the tenant had committed default in payment of
rent.
22. The tenant filed a written statement denying both these
allegations. He disputed the claim of the landlord regarding his
requiring the premises for his own use bona fide and also the
fact of his being in arrears. When the pleadings of the landlord
and the tenant were in this state, both parties filed a
compromise memo in and by which they agreed to the passing
of a decree of eviction against the tenant. Representations to the
same effect were also made by the counsel for both parties. The
court passed the following order:
“In view of the statement of the parties’ counsel
and the written compromise, a decree is passed in
favour of the plaintiff against the defendant.”
The tenant did not vacate the premises within the time
mentioned as per the compromise memo. On the other hand,
4 (1969) 1 SCC 59
13
he filed an application under Section 47 of the Civil
Procedure Code pleading that the decree is void as being in
contravention of Section 13 of the Delhi statute. The High
Court held that the decree was a nullity, as the order was
passed solely on the basis of the compromise without
indicating that any of the statutory grounds mentioned in
Section 13 existed. Following the decision in Bahadur
Singh this Court upheld the order of the High Court. Here
again, it will be seen that the manner in which the court’s
satisfaction is to be expressed or gathered has not been dealt
with.
23. A similar question came up again before this Court in
Ferozi Lal Jain v. Man Mal5. The landlord filed an application
for eviction of the tenant on the ground that he had sublet the
premises without obtaining his consent in writing. Subletting,
without the consent of the landlord in writing, was one of the
grounds, under Section 13(1) of the Delhi statute entitling a
landlord to ask for eviction. The tenant denied the allegation
that he had sublet the premises. Both the landlord and the tenant
entered into a compromise and the court, after recording the
same, passed the following order:
“As per compromise, decree for ejectment and for Rs
165 with proportionate costs is passed in favour of the
plaintiff and against the defendant. The parties shall
be bound by the terms of the compromise. The terms
of the compromise be incorporated in the decreesheet....”
24. As the tenant did not surrender possession of the properties
within the time mentioned in the compromise memo, the
landlord levied execution. It was resisted by the tenant on
various grounds one of which was that the decree for eviction
was a nullity, being in contravention of Section 13 of the Delhi
Statute. This contention was accepted by the execution court, as
well as by the High Court. This Court, after a reference to the
5 (1970) 3 SCC 181
14
provisions of Section 13, held that a decree for recovery of
possession can be passed only if the court concerned is satisfied
that one or other of the grounds mentioned in the section is
established. This Court, further observed:
“From the facts mentioned earlier, it is seen that at no
stage, the Court was called upon to apply its mind to
the question whether the alleged subletting is true or
not. Order made by it does not show that it was
satisfied that the subletting complained of has taken
place, nor is there any other material on record to
show that it was so satisfied. It is clear from the
record that the court had proceeded solely on the basis
of the compromise arrived at between the parties. That
being so there can be hardly any doubt that the court
was not competent to pass the impugned decree.
Hence the decree under execution must be held to be a
nullity.”
13. In Nagindas Ramdas v. Dalpatram Ichharam alias Brijram and
Others6 it was stated:-
“17. It will thus be seen that the Delhi Rent Act and the
Madras Rent Act expressly forbid the Rent Court or the
Tribunal from passing a decree or order of eviction on a ground
which is not any of the grounds mentioned in the relevant
Sections of those statutes. Nevertheless, such a prohibitory
mandate to the Rent Court that it shall not travel beyond the
statutory grounds mentioned in Sections 12 and 13, and to the
parties that they shall not contract out of those statutory
grounds, is inherent in the public policy built into the statute
(Bombay Rent Act).
6 (1974) 1 SCC 242
15
18. In Rasiklal Chunilal case, a Division Bench of the Gujarat
High Court has taken the view that in spite of the fact that there
is no express provision in the Bombay Rent Act prohibiting
contracting out, such a prohibition would have to be read by
implication consistently with the public policy underlying this
welfare measure. If we may say so with respect, this is a correct
approach to the problem.
19. Construing the provisions of Sections 12, 13 and 28 of the
Bombay Rent Act in the light of the public policy which
permeates the entire scheme and structure of the Act, there is no
escape from the conclusion that the Rent Court under this Act is
not competent to pass a decree for possession either in invitum
or with the consent of the parties on a ground which is de hors
the Act or ultra vires the Act. The existence of one of the
statutory grounds mentioned in Sections 12 and 13 is a sine qua
non to the exercise of jurisdiction by the Rent Court under these
provisions. Even parties cannot by their consent confer such
jurisdiction on the Rent Court to do something which,
according to the legislative mandate, it could not do.
….
22. The mere fact that Order 23 Rule 3, of the Code of Civil
Procedure is applicable to the proceedings in a suit under the
Bombay Rent Act, does not remove that fetter on the Rent
Court or empower it to make a decree for eviction de hors the
statute. Even under that provision of the Code, the Court, before
ordering that the compromise be recorded, is required to satisfy
itself about the lawfulness of the agreement. Such lawfulness or
otherwise of the agreement is to be judged, also on the ground
whether the terms of the compromise are consistent with the
provisions of the Rent Act.
….
27. From a conspectus of the cases cited at the bar, the principle
that emerges is, that if at the time of the passing of the decree,
there was some material before the Court, on the basis of
which, the Court could be prima facie satisfied, about the
16
existence of a statutory ground for eviction, it will be presumed
that the Court was so satisfied and the decree for eviction
though apparently passed on the basis of a compromise, would
be valid. Such material may take the shape either of evidence
recorded or produced in the case, or, it may partly or wholly be
in the shape of an express or implied admission made in the
compromise agreement, itself. Admissions, if true and clear, are
by far the best proof of the facts admitted. Admissions in
pleadings or judicial admissions, admissible under Section 58
of the Evidence Act, made by the parties or their agents at or
before the hearing of the case, stand on a higher footing than
evidentiary admissions. The former class of admissions are
fully binding on the party that makes them and constitute a
waiver of proof. They by themselves can be made the
foundation of the rights of the parties. On the other hand,
evidentiary admissions which are receivable at the trial as
evidence, are by themselves, not conclusive. They can be
shown to be wrong.”
14. The common thread that runs through the aforesaid pronouncements
of this Court is – in cases where protection under a Rent Act is available, no
eviction can be ordered unless ground seeking eviction is made out, even if
parties had entered into a compromise. Moreover, the invalidity on that
count can even be raised in execution. In the present case, the order dated
28.03.2014 did not remotely note that any particular ground under the Rent
Act was made out.
15. In the circumstances, in our considered view, the order passed by the
appellate court was absolutely correct and did not call for any interference
17
on part of the High Court. We, therefore, allow the present appeals and
restore the order dated 19.01.2016 passed by the appellate court in IA
No.465 of 2015. The appeal shall now be heard on merits and disposed of in
accordance with law. Since there was delay of more than 600 days on part
of the appellants, we direct that the appellants shall pay costs of Rs.50,000/-
to the respondent which shall be over and above that already imposed by the
appellant court and shall be made over within six weeks from this Judgment.
The appeals stand allowed in the aforesaid terms.
..………………………J.
(Abhay Manohar Sapre)
..………………………
J.
(Uday Umesh Lalit)
New Delhi,
August 14, 2018.
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