Whether exemption from rent law is in respect of premises or with respect to parties?

It is well settled by a decision of this Court in Bhatia Cooperative Housing Society Ltd. v. D.C. Patel MANU/SC/0064/1952 : [1953]4SCR185 wherein pari materia provisions contained in the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 came up for consideration of this Court. It was held that the exemption is not conferred on the relationship of landlord and tenant but on the premises itself making it immune from the operation of the Act. In identical facts, as the present case is, the decision of this Court was followed by the High Court of Madhya Pradesh in Radhevlal Somsingh v. Ratansingh Kishansingh MANU/MP/0095/1977 : 1977 MPLJ 335 and it was held that the immunity from operation of the Madhya Pradesh Accommodation Control Act, 1961 is in respect of the premises and not with respect to the parties. If a tenant in municipal premises lets out the premises to another, a suit by the tenant for ejectment of his tenant and arrears of rent would not be governed by the Act as the premises are exempt under Section 3(1) (b) of Act though the suit is not between the municipality as landlord and against its tenant. We find ourselves in agreement with the view taken by the High Court of Madhya Pradesh in Radheylal's case.

IN THE SUPREME COURT OF INDIA

Civil Appeal No. 2704 of 2000

Decided On: 01.05.2003

 Parwati Bai Vs.  Radhika

Hon'ble Judges/Coram:

R.C. Lahoti and B.N. Agrawal, JJ.

Citation: AIR 2003 SC 3995,(2003) 12 SCC 551

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Whether plea of exemption from rent law is to be specifically pleaded and proved?

 Lastly, it may be pointed out that in the present case, the suit was filed in 1980. Section 2(7)(bb)(iii) was amended in 1994. Under the said Amendment, the expression "under the management of the State Government" stood deleted. Therefore, it was argued on behalf of the appellant that the Karnataka Rent Control Act 1961 has no application. As held by the High Court this plea was not taken by the appellant in the Courts below. Further, Section 2(7)(bb)(iii) states that the Act will not apply to any premises belonging to a religious or charitable institution. However, there is no material placed on record by way of pleadings to show whether the appellant is a religious or charitable institution. The plaint was never amended. The appellant seeks exemption. Exemption needs to be alleged and proved. Opportunity is required to be given to the respondent to meet the plea of exemption. In the circumstances, we are in agreement with the view expressed by the High Court that the said plea was not open to the appellant at the stage of second appeal, particularly in the absence of any material available to substantiate such plea.

IN THE SUPREME COURT OF INDIA

Civil Appeal No. 4122 of 1999

Decided On: 22.07.2004

Kaveripatnam Subbaraya Setty Annaiah Setty Charities Trust

Vs. S.K. Viswanatha Setty

Hon'ble Judges/Coram:

Ashok Bhan and S.H. Kapadia, JJ.

Citation: (2004) 8 SCC 717,AIR 2004 SC 3929

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Whether exemption from rent law is in respect of premises or with respect to parties?

From the aforesaid it is graphically clear that an Insurance Company is not protected under the 1999 Act. Once it is held that Defendant No. 1, the New India Assurance Company, the original tenant, is not protected, the question would be whether a subtenant can be protected under the Act. In the case of Bhatia Co-operative Housing Society Ltd. (supra), it has been clearly laid down that Section 4(1) of the 1947 Act applies to premises and not to parties or their relationship. Section 3 uses the term 'premises'. The provision commences with the non-obstante clause that the Act does not apply to any premises belonging to the Government or a local authority. Sub-Section 3(1)(b) makes it clear that the Act does not apply to any bank, public sector undertaking or certain other categories of tenants. The Insurance Company is covered under Section 3(1)(b). Thus, as a logical corollary, the Act does not apply to the premises held by the Insurance Company who is a tenant.

23. The learned Single Judge has allowed protection to the Government Department on the foundation that it has become a tenant. We are disposed to think that the analysis is fundamentally erroneous. When the Act does not cover the tenant, namely, the Insurance Company as basically the exemption applies only to premises and not to any relationship, the subtenant who becomes a deemed tenant cannot enjoy a better protection or privilege by ostracizing the concept of premises which is the spine of the provision.
IN THE SUPREME COURT OF INDIA

Civil Appeal Nos. 3356-3357/2012 (Arising out of SLP (C) Nos. 3273-327 of 2011)

Decided On: 03.04.2012

 Kesri Commissariat and Ors. Vs. Ministry of Food and Civil Supplies, Govt. of Maharashtra, Mumbai and Anr.

Hon'ble Judges/Coram:

Dalveer Bhandari and Dipak Misra, JJ.
Citation: AIR 2012 SC 1271: 2012(5) MHLJ 212(SC)

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