Thursday 12 September 2019

Important Judgments on rent law Part 1

1)How to appreciate bonafide need of landlord?

It is well settled that the courts cannot ordinarily doubt the bona fide need of the landlord nor the courts can dictate to the landlord as to how the premises owned by him should be used. It is sufficient for the landlord to express his desire to occupy the premises which are owned by him. It is not necessary for the landlord to establish the dire necessity but it is enough to show that some need exists.

Bombay High Court

Balwant P. Doshi vs Shantaben Dhirajlal Shah And Anr. on 4 July, 2002
Equivalent citations: 2003 (2) BomCR 190, 2002 (4) MhLj 473

Bench: A Khanwilkar
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2) Whether landlord can be denied eviction decree even if tenant acquires alternative accommodation?

 Having considered the rival submission, I shall first advert to the ground under Section 13(1)(l) of the Act. Indeed both the Courts below have elaborately examined the matter and found that the Petitioner tenant has secured alternative accommodation both for business as well as for residence and, therefore, the decree for possession was granted. However, to my mind, the test applied by both the Courts below is wholly incorrect. Whereas, on plain language of the provision, the ground under this provision is available only when the demised premises were let out for residential purpose only. This is the settled legal position. It will be useful to refer to Dr. Gopaldas Verma's case . To put it differently, this ground would come into play only in respect of premises let out for residential purpose only and not in relation to tenancy created for business or for that matter composite tenancy for business cum residence. If we were to hold otherwise, that would be rewriting the provision and against the legislative intent. To my mind, therefore, when tenancy is created for business purpose or composite tenancy for business cum residence; And if such a tenant were to acquire alternative premises even then it would not create any right in favour of the landlord to get back possession of the demised premises by invoking Section 13(1)(1) of the Act as such. None of the Courts below have examined this aspect of the matter. Whereas this is the crucial test to be applied for invoking Section 13(1)(1) of the Act. In the present case, it has been established from the record that the tenancy in respect of the demised premises was initially created in 1939 for composite user of business cum residence. The rent note (Exh.117) establishes this position, besides the other evidence on record. Besides, in this case the Plaintiff has neither pleaded that the dominant purpose for letting out the demised premises was for residence nor any attempt was made to adduce evidence to establish that fact. Moreover, no such argument was canvassed or considered by the courts below. A priori, Section 13(1)(1) will have no application to the case at hand. Therefore, although two Courts below have answered this issue in favour of the landlord, the said view cannot be sustained and will have to be overturned.
Bombay High Court

Tarachand Hassaram Shamdasani vs Shri Durgashankar G. Shroff And ... on 12 August, 2002

Bench: A Khanwilkar
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3) What is distinction between expressions 'genuinely requires' and 'reasonably requires'?

 As to alternative accommodation disentitling the landlord to the relief of possession it was held that it must be reasonably equivalent as regards suitability in respect to the accommodation he was claiming. This statement of law was cited with approval before a Full Bench of the High Court of Madhya Pradesh in Damodar Sharma and Anr. v. Nandram Deviram MANU/MP/0162/1960 : AIR1960MP345 . Pandey, J. recording the majority opinion emphasised the distinction between the expressions 'genuinely requires' and 'reasonably requires' and said:

It is wrong to say that "genuinely requires" is the same as "reasonably requires". There is a distinction between the two phrases. The former phrase refers to a state of mind; the latter to an objective standard. "Genuine requirement" would vary according to the idiosyncrasy of the individual and the time and circumstances in which he lives and thinks. Reasonable requirement belongs to the "knowledge of the law" and means reasonable not in the mind of the person requiring the accommodation but reasonable according to the actual facts. 

C.A. No. 4166 of 1999

Decided On: 30.08.1999

Shiv Sarup Gupta Vs. Dr. Mahesh Chand Gupta

Hon'ble Judges/Coram:
V.N. Khare and R.C. Lahoti, JJ.
Citation: AIR 1999 SC 2507
Read full judgment here: Click here


In a landmark judgment passed by a Full Bench of the Bombay High Court (“Court”), the Court has laid down the law regarding operation of an arbitration clause in agreements giving a license to use property executed in Greater Mumbai. The Court has thereby confirmed its earlier judgments which held that arbitration clauses in Leave and License Agreements pertaining to properties situated in Greater Mumbai are void and the jurisdiction to try all disputes in such arrangements vests with the Small Causes Court in Mumbai as per the provisions of the Presidency Small Causes Court Act, 1882 (“Presidency Act”).
The claim of the applicant for licence fee would fall within the exclusive jurisdiction of Small Causes Court as per section 26 of the Act of 1887 in view of the judgment given by the Full Bench of this Court in the case of Central Warehousing Corporation, Mumbai v. Fortpoint Automotive Pvt. Ltd., Mumbai (supra).
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5) Factors to be considered by court for judging whether structures are permanent or not

There are numerous authorities dealing with the question how the structure is a permanent structure or not should be judged. It is not necessary to deal with all these. One must look to the nature of the structure, the purpose for which it was intended and take a whole perspective as to how it affects the enjoyment, the durability of the building etc. and other relevant factors and come to a conclusion.

22. Judged in the aforesaid light on an analysis of the evidence the trial court as well as the appellate court had held that the structures were permanent. The High Court observed that in judging whether the structures were permanent or not, the following factors should be taken into consideration referring to an unreported decision of Malvankar J. in special civil application No. 121 of 1968. These were (1) intention of the party who put up the structure; (2) this intention was to be gathered from the mode and degree of annexation; (3) if the structure cannot be removed without doing irrepairable damage to the demised premises then that would be certainly one of the circumstances to be considered while deciding the question of intention.

23. Likewise, dimensions of the structure and (4) its removability had to be taken into consideration. But these were not the sole tests. (5) the purpose of erecting the structure is another relevant factor. (6) the nature of the materials used for the structure and (7) lastly the durability of the structure. These were the broad tests.

Civil Appeal Nos. 1955-56 of 1980

Decided On: 21.07.1987

Venkatlal G. Pittie and Anr.Vs. Bright Bros. (Pvt.) Ltd.

Hon'ble Judges/Coram:
S. Natarajan and Sabyasachi Mukherjee, JJ.

Citation:1987(3) SCC 558
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6) Whether it is necessary to issue Notice U/S 106 Transfer of Property Act after decree for eviction is passed by Court?

In Dhanapal Chettiar vs. Yesodai Ammal ([1980] 1 S.C.R. 334 = AIR 1979 SC 1745), the question before the Apex Court was as to whether in order to get a decree or order for eviction against a tenant under any State Rent Control Act it is necessary to give a notice u/s. 106 of the Transfer of Property Act?
The Court observed that it is true that the Rent Act is intended to restrict the rights which the landlord possessed either for charging excessive rents or for evicting tenants, but if within the ambit of those restricted rights he makes out his case, it is a mere empty formality to ask him to determine the contractual tenancy before institution of a suit for eviction. This was necessary under the Transfer of Property Act as mere termination of the lease entitled the landlord to recover possession. But under the Rent Control Acts it becomes an unnecessary technicality to insist that the landlord must determine the contractual tenancy. It is of no practical use after so many restrictions on his right to evict the tenant have been put.
The restricted area under the various State Rent Acts has done away to a large extent with requirement of the law of contract and the Transfer of Property Act. If "protection from eviction is claimable by the tenant even after, determination of the contractual tenancy" then why import the contractual law engrafted in the Transfer of Property Act for seeking eviction of the tenant?

The tenant becomes liable to be evicted and forfeiture comes into play only if he has incurred the liability to be evicted under the State Rent Act, not otherwise. In many State statutes different provisions have been made as to the grounds on which a tenant can be evicted and in relation to his incurring the liability to be so evicted. Some provisions overlap those of the Transfer of Property Act. Some are new which are mostly in favour of the tenants but some are in favour of the landlord also. Here, one has to look to the provisions law contained in the four corners of any State Rent Act to find out whether a tenant can be evicted or not. The theory of double protection or additional protection held to have stretched too far and without a proper and due consideration of all its remifications.
It was accordingly held that no notice to quit is necessary under Section 106 of the Transfer of Property Act in order to enable the landlord to get an order of eviction against the tenant.

Supreme Court of India

V. Dhanapal Chettiar vs Yesodai Ammal on 23 August, 1979

Equivalent citations: 1979 AIR 1745, 1980 SCR (1) 334

Bench: Chandrachud, Y.V. ((Cj), Sarkaria, Ranjit Singh, Untwalia, N.L., Shingal, P.N. & Kailasam, P.S., Reddy, O.C. & Venkataramiah, E.S.
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7) Whether eviction decree can be passed against tenant on ground of non user of premises if he has subletted it?

Hence for a claim under Section 13(1)(k) it is not necessary for a landlord to establish that the premises are left to a total non-user. It is enough if he proves that his tenant has not used the premises for the purpose for which they were let for a continuous period of six months immediately preceding the date of the suit and the same was without reasonable cause. Though the premises are shown to be in use say by a third person or for a purpose other than the one for which they were let, the same cannot detract from the concept of 'non-user' contemplated under Section 13(1)(k). In this view of the matter, though the premises had been occupied by a third party, the ground of non-user is still open to the plaintiff for claiming possession.


W.P. No. 4598 of 2005

Decided On: 20.10.2005

 Bhaskar Wamanrao Rithe  Vs. Indira Iyer

Hon'ble Judges/Coram:
B.P. Dharmadhikari, J.

Citation: 2006 (1) MHLJ 155.
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8) Whether it is permissible for tenant to raise dispute of standard rent in written statement?

So far as the first ground of eviction of arrears of rent is concerned, it is an admitted case that the tenant Manilal was in arrears of rent from 06.07.1974 to 05.05.1976 amounting to Rs. 660/- and proper notice (Ex. 31) was issued asking him to vacate premises in case he fails to make good the arrears of rent. Though the tenant Manilal received the said notice, no reply was sent there to; nor the dispute of standard rent was raised. It is only in the written statement filed by him, the dispute was raised for the first time as to the standard rent. Notably, the tenant Manilal had never applied for fixation of the standard rent earlier nor within one month of the service of notice had he applied for fixation of the standard rent. As noted earlier, the tenant Manilal did not even send reply notice disputing the standard rent.

13. According to the Appellant-landlord, the property is situated on main road and Gajrawadi bus stand is also nearby and hence, the standard rent of the demised property cannot be less than Rs. 30/- per month. It is also pertinent to note that at relevant point of time, first floor of the tenanted premises was let out to another tenant namely Chimanlal Jaiswal who was using the same for residence and had been paying rent of Rs. 30/- per month. Likewise, the second floor was let out to one tenant named Rikhavchand who was also using it as residence and the ground floor was let out for hair cutting salon on the rent of Rs. 30/- per month. Upon consideration of evidence, the trial court recorded that rent of Rs. 30/- per month for the salon in the ground floor cannot be said to be excessive. There is no bona fide in the dispute raised by the tenant as to the standard rent. From the evidence of Appellant-landlord admittedly there was default in payment of rent for more than six months and the tenant was liable to be evicted Under Section 12(3)(a) of the Bombay Rent Control Act.


Civil Appeal No. 5284 of 2006

Decided On: 12.04.2017

 Anil Kumar Dadurao Dhekle Vs. Rukhiben and Ors.

Hon'ble Judges/Coram:
Kurian Joseph and R. Banumathi, JJ.
Citation: (2017) 14 SCC 215
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Which provisions of maharashtra rent control Act is applicable to tenants of public undertaking?

 In the circumstances, we hold as follows:

(a) The provisions of the Maharastra Rent Control Act, 1999 with respect to fixation of Standard Rent for premises, and requiring the landlord not to cut off or withhold essential supply or service, and to restore the same when necessary, are not in conflict with or repugnant to any of the provisions of the Public Premises (Eviction of Unauthorised Occupants) Act, 1971.

(b) The provisions of the Public Premises Act, 1971 shall govern the relationship between the public undertakings covered under the Act and their occupants to the extent they provide for eviction of unauthorised occupants from public premises, recovery of arrears of rent or damages for such unauthorised occupation, and other incidental matters specified under the Act.

(c) The provisions of the Maharashtra Rent Control Act, 1999 shall govern the relationship between the public undertakings and their occupants to the extent this Act covers the other aspects of the relationship between the landlord and tenants, not covered under the Public Premises Act, 1971.

(d) The application of Appellant and similar applications of the tenants for fixation of Standard Rent or for restoration of essential supplies and services when necessary, shall be maintainable under the Maharashtra Rent Control Act, 1999.


Civil Appeal No. 7171 /2010 (Arising out of Special Leave Petition (Civil) No. 34125 of 2009)

Decided On: 19.09.2011

Banatwala and Company Vs.  L.I.C of India 

Hon'ble Judges/Coram:
R.V. Raveendran and H.L. Gokhale, JJ.

Citation: (2011) 13 SCC 446
Read full judgment here: Click here

Supreme Court: Destruction of tenanted building will not determine tenancy

Therefore, we agree with the proposition stated therein to the affect that "in the event of the tenancy having been created in respect of a building standing on the land, it is the building and the land which are both components of the subject-matter of demise and the destruction of the building alone does not determine the tenancy when the land which was the site of the building continues to exist"
Civil Appeal No. 127 of 2007
Decided On: 10.07.2014

Shaha Ratansi Khimji and Sons

Vs. Proposed Kumbhar Sons Hotel P. Ltd.

Respondent: Proposed Kumbhar Sons Hotel P. Ltd.
Hon'ble Judges/Coram:R.M. Lodha, C.J.I., Sudhansu Jyoti Mukhopadhaya and Dipak Misra, JJ.
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