Law relating on Rent

MOOT COURT AND INTERNSHIP PROJECT

LAW RELATING TO RENT, LEASE AND EVICTION

CHANAKYA NATIONAL LAW UNIVERSITY, PATNA

under the guidance of: Mr. Anshuman

 project submitted submitted by: SHASHI SHEKHAR KASHYAP ROLL NO.- 3264 SEMESTER- 10

TH

SESSION- 2008-13 COURSE- B.A. LL.B.

 ACKNOWLEDGEMENT  ACKNOWLEDGE MENT

 I take this opportunity opportunity to express my humble humble gratitude and personal personal regards to to Mr. Anshuman  for inspiring me and guiding me during the course of this project work

and also for his cooperation and guidance from time to time during the course of this project work on the topic

“LAW RELATING TO RENT, LEASE AND EVICTION ”

“I EXPRESS MY GRATITUDE TO THE FACULTY OF, „MOOT COURT AND INTERNSHIP‟ FOR THE CONCEPTS GIVEN BY HIM IN THE SUBJECT WHICH HAS BEEN THE BASE FOR THIS SMALL PIECE OF WORK.”

Y OURS O URS SINCERELY  SHASHI SHEKHAR KASHYAP ROLL NO. 3264

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RESEARCH METHODOLOGY

Aims and Objectives:

The aim of the project is to present a detailed study of the topic LAW RELATING TO RENT, LEASE AND EVICTION through decisions and suggestions and different writings and

articles. Scope and Limitations:

Though the topic LAW RELATING TO RENT, LEASE AND EVICTION   is an immense  project and pages pa ges can be written over the topic but because of o f certain restrictions and limitations I was not able to deal with the topic in great detail.

Method of Writing and Mode of Citation:

The method of writing followed in the course of this research project is primarily analytical. The researcher has followed Uniform method of citation throughout the course of this research  project.

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Contents INTODUCTION ........................................................................................................................................... 6 GENERAL CONCEPT ABOUT LEASE..................................................................................................... 7 Lease ......................................................................................................................................................... 7 License ...................................................................................................................................................... 7 Principles To Distinguish Lease From License ........................................................................................ 7 Statutory Provisions In Respect of Lease of Immovable Property ........................................................... 9 Definition of lease under S. 105 of the Transfer of Property Act, 1882 ................................................... 9 Duration Of Certain Leases In Absence Of Written Contract Or Local Usage ........................................ 9 Making Of Lease [S. 107 Of The Transfer Of Property Act, 1882] ....................................................... 10 Rights and liabilities of lessor and lessee ............................................................................................... 10 Rights of lessor's transferee .................................................................................................................... 13 Exclusion of day on which term commences [S. 110 Of The Transfer Of Property Act, 1882] ............ 14 Determination of lease [S. 111 Of The Transfer Of Property Act, 1882] .............................................. 14 Waiver of forfeiture [S. 112 Of The Transfer Of Property Act, 1882] ................................................... 15 Waiver of notice to quit [S. 113 Of The Transfer Of Property Act, 1882] ............................................. 15 Relief against forfeiture for non-payment non-payment of rent [S. 114 Of The Transfer Of Property Act, 1882] ..... 15 Relief against forfeiture in certain other cases [S. 114A Of The Transfer Of Property Act, 1882] ....... 16 Effect of surrender and forfeiture on underleases [S. 115 Of The Transfer Of Property Act, 1882] ..... 16 Effect of holding over [S. 116 Of The Transfer Of Property Act, 1882] ............................................... 16 Exemption of leases for agricultural purposes [S. 117 Of The Transfer Of Property Act, 1882] .......... 17 Relevant Statutory Provisions About The Protection Of Tenants Against Harassment And Exploitation By Avaricious Landlords ........................................................................................................................ 17 Rights and remedies available to the landlord against tenant and vice-versa. ........................................ 18 "CONTRACTUAL TENANCY" AND "STATUTORY TENANCY" ...................................................... 19 Tenant At Sufferance, Tenant At Will And Tenant By Holding Over ................................................... 19

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Heritability Of Statutory Tenancy .......................................................................................................... 24 The principles laid down in Gian Devi's case with regard to heritability of tenancy. ............................ 36 RENT CONTROL LEGISLATION ........................................................................................................... 39 Provisions regarding re garding rent with wit h special reference to the Delhi Rent Control Con trol Act, 1958 .......................... ................ .......... 39 The procedure for the landlord to increase the rent contracted with the tenant ...................................... 41 Premises: Exemption From Applicability Of Rent Control Legislation ................................................. 44 GROUNDS OF EVICTION ....................................................................................................................... 48 1.  Non-Payment  Non-Payment of Rent/Arrears Rent/Arrears of Rent Rent................... ............................ .................. .................. .................. ................... ................... .................. .................. ......... 48 2.

Sub-letting the Rented Out Premises .............................................................................................. 51

3.  Non-user of the the Rented Premises Premises for more than six months months .................. ........................... .................. .................. .................. .............. ..... 53 4.

Impermissible User of the Rented Premises ................................................................................... 54

3. Tenant Acquiring Acquirin g Vacant Possession of or has been Allotted a Residence ................................. ................ ........................ ....... 55 5.

Use of premises in violation of conditions of lease stipulated by DDA/MCD ............................... 55 Difference between section 14(1)(c) and section 14(1)(k) ................................................................. 56

SUMMARY PROCEDURE ....................................................................................................................... 62 REMEDY AGAINST CUTTING OFF OR WITHHOLDING ESSENTIAL SUPPLY OR SERVICE .... 65 CONCLUSION ........................................................................................................................................... 67 BIBLIOGRAPHY ....................................................................................................................................... 68

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INTODUCTION The basic objective of the rent control legislation is to protect the tenant against exorbitant rents, arbitrary increases in the rent and ensure him security of tenure. The legislation has been necessitated by conditions of scarcity prevailing in rental housing markets of urban areas. As housing is a State subject, different State Governments have framed their own rent control laws. By 1972, almost all the States in the country had enacted Rent control Acts (RCA). Rent control was conceived as a short term measure to overcome the problem of temporary shortages during World wars. The Acts were therefore enacted for short and limited durations. This practice has continued and the rent control Acts in most States are temporary Acts and are extended every few years. The State Governments have periodically amended the Acts either in response to changing market conditions or to plug some loopholes and improve the functioning of the Acts. Under the Indian Constitution, housing (provision of) is a state subject. Thus, the enactment and enforcement of rent control laws is the responsibility of the individual states. While this is in accordance with the federal nature of the Indian Republic, it makes a comparative analysis of the rent control laws that much more difficult. The common thread running through almost all rent control Acts and legislations is that they are intended to serve two purposes: 1. To protect the tenant from eviction from the house where he is living except for defined reasons and on defined conditions; and 2. To protect him from having to pay pa y more than a fair/standard rent. The rent control Acts are generally applicable to all urban areas in the States and to most of the residential and non-residential premises in these urban areas. The exempted premises include those belonging to the Union Government, State Government and local authorities. Some states also exclude from the preview of the Act properties falling below or above certain rental values, newly constructed properties, as also properties belonging to charitable Trusts etc. In each city these exemptions account for a significant proportion of the total rental housing stock. Under the common law, tenancy is governed by the Transfer of Properties Act, 1882.

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GENERAL CONCEPT ABOUT LEASE 'Tenancy' or the 'lease' has its origin in contract, entered into between the landlord and the tenant for a consideration of a price paid or promised (called premium) or of money, a share of crops, service or any other thing of value (called as rent) to be rendered periodically or on specified occasions.

LEASE Under the common law, tenancy is governed by the Transfer of Properties Act, 1882. Section 105 defines 'lease' as a transfer of a right to enjoy immovable property, made for a certain time, expressed or implied, or in perpetuity, in consideration of the aforementioned premium or rent. To understand the meaning of the term 'lease' properly one needs to distinguish it from the term 'license', because in both the cases, transferor permits the transferee to use his property.

LICENSE Where one person grants to another, or to a definite number of other persons, a right to do, or continue to do, in or upon the immovable property of the grantor, something which would, in the 1

absence of such right, be unlawful, and such right does not amount to an easement  or an interest 2

in the property, the right is called a license.

PRINCIPLES TO DISTINGUISH LEASE FROM LICENSE From a bare perusal of the aforesaid definitions of the term 'lease' and 'license' it is apparent that license is merely a permissive right. It is purely a personal privilege granted by the transferor to the transferee and it does not create an interest in the immovable property. For example, right to catch fish from the pond, right to pluck coconuts, mangoes, or any other fruit or vegetable for a  particular period. Similarly, a hosteller stays in a Hostel as a licensee. But in the case of lease an interest in the property is created, which is apparent when possession of the immovable property is transferred to the transferee. Therefore, this handing over of exclusive possession by the 1

 "Easement" defined. _ An easement is a right which the owner or occupier of certain land possesses, as such, for the beneficial enjoyment of that land, to do and continue to do something, or to prevent and continue to prevent something being done, in or upon, or in respect of, certain other land not his own. 2  Section 52 of the Indian Easements Act, 1882

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transferor to the transferee reflects the intention to create a lease and not the license, which is  purely of permissive nature. However, the difficulty arises in those cases where despite exclusive  possession having been handed over to the transferee interest in the property is not created. In such cases, it is very difficult to distinguish between the lease and license. Therefore, though, the distinction between the two concepts is very clear, but sometimes, the dividing line becomes very thin or even blurred. At one time it was thought that the test of exclusive possession was infallible and if a person was given exclusive possession of a premises, it would conclusively establish that he was a lessee. But there was a change and the recent trend of judicial opinion is reflected in  Errington v.  Errington, wherein  Errington, wherein Lord Denning reviewing the case law on the subject summarizes the result of his discussion as: “The result of all these all these cases is that, although a person who is let into exclusive  possession is, prima facie, to be considered to be tenant, nevertheless he will not be held to be so 3

if the circumstances negative any intention to create a tenancy.”

The Court of Appeal again in Cobb v. Lane, considered the legal position and laid down that the 4

intention of the parties was the real test for ascertaining the ch aracter of a document.

Denning, L.J., said much to the same effect: “The question in all these cases is one of intention: int ention: Did the circumstances and the conduct of the parties show that all that was intended was that the 5

occupier should have a personal privilege with no interest in the land?”

The following propositions may, therefore, be taken as well-established: 1. To ascertain whether a document creates a licence or lease, the substance of the document must be preferred to the form; 2. The real test is the intention of the parties-whether they intended to create a lease or a licence; 3. If the document creates an interest in the property, it is a lease; but, if it only permits another to make use of the property, of which the legal possession continues with the owner, it is a licence; and

3

 Errington v. Errington, (1952) 1 All ER 149 p. 155. Cobb v. Lane, (1952) 1 All ER 1199 p. 1201 5  Ibid. p. 1202 4

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4. If under the document a party gets exclusive possession of the property, prima facie, he is considered to be a tenant; but circumstances may be established which negative the intention to create a lease.

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ESPECT OF LEASE OF IMMOVABLE PROPERTY STATUTORY PROVISIONS IN R ESPECT

Lease of immovable property is governed by Chapter V of the Transfer of Property Act, 1882, which contains provisions from 117. These provisions are essential to understand the concept of lease under the said Act, which for the sake of convenience, in our country, is referred to as "Contractual Tenancy", vis--vis the tenancy under the special piece of legislation in respective States (for example Delhi Rent Control Act, 1958 in Delhi), which is referred to as "Statutory Tenancy".

DEFINITION OF LEASE UNDER S. 105 OF THE TRANSFER OF PROPERTY ACT, 1882 A lease of immovable property is a transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts th e transfer on such terms. Lessor, lessee, premium and rent defined: The transferor is called the lessor, the transferee is called the lessee, the price is called the premium, and the money, share, service or other thing to  be so rendered is called the rent.

DURATION OF CERTAIN LEASES IN ABSENCE OF WRITTEN CONTRACT OR LOCAL USAGE In the absence of a contract or local law or usage to the contrary, a lease of immovable property for agricultural or manufacturing purposes shall be deemed to be a lease from year to year, terminable, on the part of either lessor or lessee, by six months' notice expiring with the end of a year of the tenancy; and a lease of immovable property for any other purpose shall be deemed to  be a lease from month to month, month , terminable, on the part of either lessor or lessee, by fifteen da ys' notice expiring with the end of a month of the tenancy. 6

 Associated Hotels of India Ltd. v. R.N. Kapoor, AIR Kapoor,  AIR 1959 SC 1262.

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Every notice under this section must be in writing, signed by or on behalf of the person giving it, and either be sent by post to the party who is intended to be bound by it or be tendered or delivered personally to such party, or to one of his family or servants at his residence, or (if such 7

tender or delivery is not practicable) affixed to a conspicuous part of the property.

MAKING OF LEASE [S. 107 OF THE TRANSFER OF PROPERTY ACT, 1882] A lease of immovable property from year to year, or for any term exceeding one year or reserving a yearly rent, can be made only by a registered instrument. All other leases of immovable property may be made either by a registered instrument or by oral agreement accompanied by delivery of possession. Where a lease of immovable property is made by a registered instrument, such instrument or, where there are more instruments than one, each such instrument shall be executed by both the lessor and the lessee: Provided that the State Government from time-to-time, by notification in the Official Gazette, direct that leases of immovable property, other than leases from year to year, or for any term exceeding one year, or reserving a yearly rent, or any class of such leases, may be made by unregistered instrument or by oral agreement without delivery of possession.

R IGHTS IGHTS AND LIABILITIES OF LESSOR AND LESSEE In the absence of a contract or local usage to the contrary, the lessor and the lessee of immovable  property, as against one another, respectively, possess the rights and are subject to the liabilities mentioned in the rules next following, or such of them as are applicable to the property leased:(A) Rights and liabilities of the lessor

(a)The lessor is bound to disclose to the lessee any material defect in the property, with reference to its intended use, of which the former is and the latter is not aware, and which the latter could not with ordinary care discover; (b)the lessor is bound on the lessee's request to put him in possession of the property; 7

 S. 106 Of The Transfer Of Property Act, 1882

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(c)the lessor shall be deemed to contract with the lessee that, if the latter pays the rent reserved by the lease and performs the contracts binding on the lessee, he may hold the  property during the time limited by the lease without interruption. interruption. The benefit of such contract shall be annexed to and go with the lessee's interest as such, and may be enforced by every person in whom that interest is for the whole or any part thereof from time to time vested. (B) Rights and liabilities of the lessee

(d)If during the continuance of the lease any accession is made to the property, such accession (subject to the law relating to alluvion for the time being in force) shall be deemed to be comprised in the lease; (e)if by fire, tempest or flood, or violence of an army or of a mob, or other irresistible force, any material part of the property be wholly destroyed or rendered substantially and  permanently unfit for the purposes for which it was let, the lease shall, at the option of the lessee, be void: Provided that, if the inquiry be occasioned by the wrongful act or default of the lessee, he shall be entitled to avail himself of the benefit of this provision; (f)if the lessor neglects to make, within a reasonable time after notice, any repairs which he is bound to make to the property, the lessee may make the same himself, and deduct the expense of such repairs with interest from the rent, or otherwise recover it from the lessor; (g)if the lessor neglects to make any payment which he is bound to make, and which, if not made by him, is recoverable from the lessee or against the property, the lessee may make such payment himself, and deduct it with interest from the rent, or otherwise recover it from the lessor; (h)the lessee may even after the determination of the lease remove, at any time whilst he is in possession of the property leased but not afterwards all things which he has attached to the earth; provided he leaves the property in the State in which he received it;

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(i)when a lease of uncertain duration determines by any means except the fault of the lessee, he or his legal representative is entitled to all the crops planted or sown by the lessee and growing upon the property when the lease determines, and to free ingress and egress to gather and carry them; (j)the lessee may transfer absolutely or by way of mortgage or sub-lease the whole or any  part of his interest in the property, and any transferee of such interest or part may again transfer it. The lessee shall not, by reason only of such transfer, cease to be subject to any of the liabilities attaching to the lease; nothing in this clause shall be deemed to authorise a tenant having an untransferable right of occupancy, the farmer of an estate in respect of which default has been made in paying revenue, or the lessee of an estate under the management of a Court of Wards, to assign his interest as such tenant, farmer or lessee; (k)the lessee is bound to disclose to the lessor any fact as to the nature or extent of the interest which the lessee is about to take of which the lessee is, and the lessor is not aware, and which materially increases the value o f such interest; (l)the lessee is bound to pay or tender, at the proper time and place, the premium or rent to the lessor or his agent in this behalf; (m)the lessee is bound to keep, and on the termination of the lease to restore, the property in as good condition as it was in at the time when he was put in possession, subject only to the changes caused by reasonable wear and tear or irresistible force, and to allow the lessor and his agents, at all reasonable times during the term, to enter upon the property and inspect the condition thereof and give or leave notice of any defect in such condition; and, when such defect has been caused by any act or default on the part of the lessee, his servants or agents, he is bound to make it good within three months after such notice has  been given or left; (n)if the lessee becomes aware of any proceeding to recover the property or any part thereof, or of any encroachment made upon, or any interference with, the lessor's rights

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concerning such property, he is bound to give, with reasonable diligence, notice thereof to the lessor; (o)the lessee may use the property and its products (if any) as a person of ordinary  prudence would use them if they were his own; but he must not use, or permit another to use, the property for a purpose other than that for which it was leased, or fell or sell timber, pull down or damage buildings belonging to the lessor, or work mines or quarries not open when the lease was granted, or commit any other act which is destructive or  permanently injurious thereto; (p)he must not, without the lessor's consent, erect on the property any permanent structure, except for agricultural purposes; (q)on the determination of the lease, the lessee is bound to put the lessor into possession of the property.

R IGHTS IGHTS OF LESSOR 'S TRANSFEREE If the lessor transfers the property leased, or any part thereof, or any part of his interest therein, the transferee, in the absence of a contract to the contrary, shall possess all the rights, and, if the lessee so elects, be subject to all the liabilities of the lessor as to the property or part transferred so long as he is the owner of it; but the lessor shall not, by reason only of such transfer cease to  be subject to an y of the liabilities imposed upon him by the lease, unless the lessee elects to treat the transferee as the person liable to him: Provided that the transferee is not entitled to arrears of rent due before the transfer, and that, if the lessee, not having reason to believe that such transfer has been made, pays rent to the lessor, the lessee shall not be liable to pay such rent over again to the transferee. The lessor, the transferee and the lessee may determine what proportion of the premium or rent reserved by the lease is payable in respect of the part so transferred, and, in case they disagree, such determination may be made by any court having jurisdiction to entertain a suit for the  possession of the property leased.

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EXCLUSION OF DAY ON WHICH TERM COMMENCES [S. 110 OF THE TRANSFER OF PROPERTY ACT, 1882] Where the time limited by a lease of immovable property is expressed as commencing from a  particular day, in computing that time such day shall be excluded. Where no day of commencement is named, the time so limited begins from the making of the lease. Duration of lease for a year: Where the time so limited is a year or a number of years, in the absence of an express agreement to the contrary, the lease shall last during the whole anniversary of the day from which such time commences. Option to determine lease: Where the time so limited is expressed to be terminable before its expiration, and the lease omits to mention at whose option it is so terminable, the lessee, and not the lessor, shall have such option.

DETERMINATION OF LEASE [S. 111 OF THE TRANSFER OF PROPERTY ACT, 1882] A lease of immovable property determines (a)  by efflux of the time limited thereby, (b) where such time is limited conditionally on the happening of some event-by the happening of such event, (c) where the interest of the lessor in the property terminates on, or his power to dispose of the same extends only to, the happening of any event-by the happening of such event, (d) in case the interests of the lessee and the lessor in the whole of the property become vested at the same time in one person in the same right, (e)  by express surrender, that is to say, in case the lessee yields up his interest under the lease to the lessor, by mutual agreement between them, (f)  by implied surrender, (g) by (g)  by forfeiture; that is to say, (1) in case the lessee breaks an express condition which  provides that, on breach thereof, the lessor may re-enter; or (2) in case the lessee renounces his character as such by setting up a title in a third person or by claiming title in himself; or (3) the lessee is adjudicated an insolvent and the lease provides that the

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lessor may re-enter on the happening of such event; and in any of these cases the lessor or his transferee gives notice in writing to the lessee of his intention to determine the lease, (h) on the expiration of a notice to determine the lease, or to quit, or of intention to quit, the  property leased, duly given by one party to the other.

WAIVER OF FORFEITURE [S. 112 OF THE TRANSFER OF PROPERTY ACT, 1882] A forfeiture under section 111, clause (g) is waived by acceptance of rent which has become due since the forfeiture, or by distress for such rent, or by any other act on the part of the lessor showing an intention to treat the lease as subsisting: Provided that the lessor is aware that the forfeiture has been incurred: Provided further that, where rent is accepted after the institution of a suit to eject the lessee on the ground of forfeiture, such acceptance is not a waiver.

WAIVER OF NOTICE TO QUIT [S. 113 OF THE TRANSFER OF PROPERTY ACT, 1882] A notice given under section 111, clause (h), is waived, with the express or implied consent of the person to whom it is given, by any act on the part of the person giving it showing an intention to treat the lease as subsisting.

R ELIEF ELIEF AGAINST FORFEITURE FOR NON -PAYMENT OF RENT [S. 114 OF THE TRANSFER OF PROPERTY ACT, 1882] Where a lease of immovable property has been determined by forfeiture for non-payment of rent, and the lessor sues to eject the lessee, if, at the hearing of the suit, the lessee pays or tenders to the lessor the rent in arrear, together with interest thereon and his full costs of the suit, or gives such security as the Court thinks sufficient for making such payment within fifteen days, the Court may, in lieu of making a decree for ejectment, pass an order relieving the lessee against the forfeiture; and thereupon the lessee shall hold the property leased as if the forfeiture had not occurred.     5     1    e    g    a     P

R ELIEF ELIEF AGAINST FORFEITURE IN CERTAIN OTHER CASES [S. 114A OF THE TRANSFER OF PROPERTY ACT, 1882] Where a lease of immovable property has been determined by forfeiture for a breach of an express condition which provides that on breach thereof the lessor may re-enter, no suit for ejectment shall lie unless and until the lessor has served on the lessee a notice in writing(a) specifying the particular breach complained of; and (b) if the breach is capable of remedy, requiring the lessee to remedy the breach, and the lessee fails, within a reasonable time from the date of the service of the notice, to remedy the  breach, if it is capable of remedy.  Nothing in this section shall apply to an express condition against the assigning, under-letting,  parting with the possession, or disposing, of the property leased, or to an express condition relating to forfeiture in case of non-payment of re nt.

EFFECT OF SURRENDER AND FORFEITURE ON UNDERLEASES [S. 115 OF THE TRANSFER OF PROPERTY ACT, 1882] The surrender, express or implied, of a lease of immovable property does not prejudice an under lease of the property or any part thereof previously granted by the lessee, on terms and conditions substantially the same (except as regards the amount of rent) as those of the original lease; but, unless the surrender is made for the purpose of obtaining a new lease, the rent payable  by, and the contracts binding on, the underlessee shall be respectively payable to and enforceable  by the lessor. The forfeiture of such a lease annuls all such underleases, except where such forfeiture has been  procured by the lessor in fraud of the underlessees, or relief against the forfeiture is granted under section 114.

EFFECT OF HOLDING OVER [S. 116 OF THE TRANSFER OF PROPERTY ACT, 1882] If a lessee or underlessee of property remains in possession thereof after the determination of the lease granted to the lessee, and the lessor or his legal representative accepts rent from the lessee or underlessee, or otherwise assents to his continuing in p ossession, the lease is, in the absence of

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an agreement to the contrary, renewed from year to year, or from month to month, according to the purpose for which the property is leased, as specified in section 106. Illustrations (a) A lets a house to B for five years. B underlets the house to C at a monthly rent of Rs. 100. The five years expire, but C continues in possession of the house and pays the rent to A. C's lease is renewed from month to month. (b) A lets a farm to B for the life of C. C dies, but B continues in possession with A's assent. B's lease is renewed from year to year.

EXEMPTION OF LEASES FOR AGRICULTURAL PURPOSES [S. 117 OF THE TRANSFER OF PROPERTY ACT, 1882]  None of the provisions of this Chapter V apply to leases for agricultural purposes, except insofar as the State Government may, by notification published in the Official Gazette, declare all or any of such provisions to be so applicable in the case of all or any of such leases, together with, or subject to, those of the local law, if an y, for the time being in force. Such notification shall not take effect until the expiry of six months from the date of its  publication. Law related to these provisions in different cases has been b een discussed in subsequent chapters at appropriate places.

R ELEVANT ELEVANT STATUTORY PROVISIONS ABOUT THE PROTECTION OF TENANTS AGAINST HARASSMENT AND EXPLOITATION BY AVARICIOUS LANDLORDS As mentioned above, law relating to tenancy is governed by the Transfer of Property Act, 1882. Because of scarcity of accommodation and gradual high rise in the rents due to various factors, after the Second World War, the landlords were in a position to exploit the situation for unjustified personal gains to the serious detriment of the helpless tenants. Under these circumstances it became imperative for the Legislature to intervene to protect the tenants against harassment and exploitation by avaricious landlords and appropriate legislation came to be  passed in all the States and Union territories where the situation required an interference by b y the Legislature in this regard. The topic of Transfer of Property other than agricultural land is

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covered by Entry 6 of List III to the Seventh Schedule to the Constitution. Therefore both States as well as Centre are empowered to legislate on the subject. In this scenario, different States have different Rent Acts, but there is no basic or fundamental difference in regard to the law of eviction of a tenant in any of the State Rent Acts and many of them by starting certain provisions 8

with a non-obstante clause  have done away with the law engrafted in section 108 of the Transfer 9

of Property Act, 1882 .

R IGHTS IGHTS AND REMEDIES AVAILABLE TO THE LANDLORD AGAINST TENANT AND VICE VERSA .

The law relating to tenancy is governed under the common law by the Transfer of Property Act. Accordingly, the rights and remedies of the landlord and tenant are governed by the law of Contract and the law governing property relations. Section 108 lays down the rights and liabilities of the lessor and the lessee. Section 111 provides various modes for determination of the lease. The moment the contract of tenancy between the lessor and the lessee comes to an end,  by any of the modes mentioned in section 111, landlord has the right to repossess the rented  premises and to get the tenant evicted. However, landlord's normal rights vested in him by the general law, thus, continue to exist till and so long they are not abridged by the special protective legislation, like different State Rent Acts. Therefore, it is apparent these State Rents Act, are nothing but social legislations meant for the  protection of the needy and the weaker sections of the society. These State Rent Acts, make appreciable inroad on the freedom of contract because after the determination of the lease, tenant gets the protective shield under the aforesaid special protective legislation. However, it is  pertinent to mention here that the protection does not create any an y vested vest ed right which can operate  beyond the period of protection or during the period the protection is not no t in existence. ex istence. When the  protection does not exist, the normal relations of landlord and tenant come into operation. The theory of vested right, which may validly be pleaded in support of landlord's case will not be available to the tenant where the tenant undoubtedly had the rights and remedies under the  protective legislation, to claim reliefs against the landlord, but lost the same, the moment the  protection was taken away since the rights and remedies being not vested ones. 8

 For example, section 14 of the Delhi Rent Control Act, 1958 starts with non-obstante clause 9  Section 108 deals with rights and liabilities of lessor and lessee

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"CONTRACTUAL TENANCY" AND "STATUTORY TENANCY" All the State Rent Acts, by way of non-obstante clause in the respective provisions provide that despite the lease having been determined between the parties, no order or decree for recovery of  possession of the rented premises can be made by any an y court in favour of the landlord against the tenant. Thus complete bar is put over repossession of the premises by the landlord. Therefore, in this way, the rent control legislations encroach upon the freedom of contract, because the tenant gets the protective umbrella under the special legislation of Rent Act, even on termination of the tenancy. Right of the landlord to seek eviction of the tenant under the general law, merely on terminating the tenancy stands suspended so long as and to the extent of protective legislation operates. However, this complete ban on the eviction of the tenant is lifted to some extent by  providing certain grounds of eviction to the landlord under the Rent Act, on o n the basis of which application can be made in prescribed manner for recovery of possession of the premises for example, proviso to sub-section (1) of section 14 of the Delhi Rent Control Act, 1958. Thus, the relationship of the landlord and tenant under the Transfer of Property Act, the basis of which is a contract, entered into between the parties, amounts to 'contractual tenancy', a term which does not find mention in any Indian Act or judgment of the Indian Courts. However, for the sake of convenience, the term has been often used to denote the tenancy under the Transfer of Property Act, so as to distinguish it from the statutory tenancy und er the Rent Acts. A contractual tenant, under the Transfer of Property Act, becomes a statutory tenant, after the determination of lease, because such a tenant gets immunity from eviction due to non-obstante clause used in relevant provisions of different State Rent Acts. Such a statutory tenant cannot be evicted except on the grounds mentioned in the State Rent Acts.

TENANT AT SUFFERANCE , TENANT AT WILL AND TENANT BY HOLDING OVER  "Tenant at sufferance" is one who comes into possession of land by lawful title, but who holds it  by wrong after the termination of the term of expiry of the lease by efflux of time. The tenant at sufferance is, therefore, one who wrongfully continues in possession after extinction of a lawful title. There is little difference between him and a trespasser. A tenancy at sufferance is merely a fiction to avoid continuance in possession operating as a trespass. It has been described as the

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least and lowest interest which can subsist in reality. It, therefore, cannot be created by contract and arises only by implication of law when a person who has been in possession under a lawful title continues in possession after that title has been determined, without the consent of the  person entitled. A tenancy at sufferance does not create the relationship of landlord and tenant. The act of the holding over after the expiration of the term does not necessarily create a tenancy of any kind. If the lessee remaining in possession after determination of the term, the common law rule is that he is the tenant on sufferance. The expression "holding over" is used in the sense 10

of retaining possession . A distinction should be drawn between a tenant continuing in  possession after the determination of the lease, without the consent of the landlord and a tenant doing so with the landlord's consent. The former is called a tenant by sufferance in the language of the English law and the latter class of tenants is called 'a tenant holding over' or 'a tenant at Will'. The lessee holding over with the consent of the lesser is in a better position than a mere tenant at Will. The tenancy on sufferance is converted into a tenancy at Will by the assent of the landlord, but relationship of the landlord and the tenant is not established until the rent was paid and accepted. The assent of the landlord to the continuance of the tenancy after the determination of the tenancy would create a new tenancy. The possession of a tenant who has ceased to be a tenant is protected by law. Although he may not have a right to continue to possession after the 11

termination of the tenancy, his possession is judicial. " There is thus, however a subtle difference resultantly a definite distinction between a 'tenant by holding over' and a tenant at sufferance. Holding over stands equivalent to the retention of  possession after determination of lease, but with the consent of the landlord-whereas, on similar circumstances if the possession is without the consent of the landlord then the same stands out to  be a tenant at sufferance. Section 116 of the Transfer of Property Act, does let a statutory recognition to the concept of holding over. The expression 'statutory tenancy' has been coined by the Judges in England and, like many other concepts in English Law it has been imparted into the jurisprudence of this country and has  become an expression of common use to denote a tenant whose contractual tenancy has been determined but who is continuing in possession of the premises by virtue of the protection     0     2 10

 Mulla, Transfer of Property Act, 7th Edn., pp. 633, 769 11  R.V. Bhupal Prasad v. State of Andhra Pradesh, AIR 1966 SC 140.

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against the eviction afforded to him by the rent control legislation. Though the expression 'statutory tenancy' is not an expression to be found in any provision of the Delhi Rent Control Act, 1958 or the rent control legislation of any other State, but it find recognition in almost every rent control legislation. The expression used in our country is a matter of evidence to distinguish it from the concept of statutory tenancy. Genetically the parentages of these two legal concepts namely contractual tenancy and statutory tenancy is different, one owning its origin to contract and the other to rent control legislation. The contractual tenancy which is brought into existence  by virtue of contract entered into between the landlord and tenant in terms of section 105 of the Transfer of Property Act, 1882, becomes statutory tenancy the moment the lease between the  parties is determined by any of the modes as mentioned in section 111. 1 11. Such statutory tenancy, tenanc y, after determination of the lease, gets immunity from the eviction under the rent control legislation and as such becomes a statutory tenancy. There is no dispute that 'contractual tenancy is heritable', the contract being the essence of the whole concept. However, with regard to statutory tenancy, the dispute was resolved by a Constitution Bench of the Supreme Court in 12

Gian Devi Anand v. Jeevan Kumar  . In this case the question arose as to whether under the Delhi Rent Control Act, 1958, the statutory tenancy in respect of commercial premises is heritable or not. More precisely the question was whether the heirs of a deceased tenant whose statutory tenancy, in respect of commercial premises has been determined; are entitled to same  protection against eviction afforded by the Act to the tenant. Two concurring judgments were delivered, one by Bhagwati, J. and second by Justice Amarendra Nath Sen. By Bhagwati J., held that the definition of 'tenant' in section 2(l) of the Delhi Rent Control Act, 1958 - reference was made to the provisions of the Delhi Rent Control Act, 1958 because that is the statute with which the Court was concerned in the present case includes a statutory tenant. It says in clause (ii) that 'tenant' includes any person continuing in  possession after the termination of his tenancy'. Such a person would not be a tenant under the ordinary law but he is recognized as a 'tenant' by the rent control legislation and is therefore described as a statutory tenant as contra-distinguished from contractual tenant. The statutory tenant is, by virtue of inclusion in the definition of 'tenant', placed on the same footing as contractual tenant so far as rent control legislation is concerned. The rent control legislation in

12

 (1985) 2 SCC 683

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fact, does not make any distinction between contractual tenant and statutory tenant. "It does not  permit the landlord to snap his relationship with the tenant merely by b y his act of serving a notice to quit on him. In spite of the notice, the law says that he continues to be a tenant and he does so enjoying all the rights of a lessee and is at the same time deemed to be under all the liabilities such as payment of rent etc., in accordance with the law." The distinction between contractual tenancy and statutory tenancy is thus completely obliterated by the rent control legislation. Though genetically the parentage of these two legal concepts is different, one owing its origin to contract and the other to rent control legislation, they are equated with each other and their incidents are the same. If a contractual tenant has an estate or interest in the premises which is heritable, it is difficult to understand why a statutory tenant should be held not to have such heritable estate or interest. In one case, the estate or interest is the result of contract while in the other it is the result of statute. But the quality of the estate or interest is the same in both cases. The difficulty in recognizing that a statutory tenant can have estate or interest in the premises arises from the fact that throughout the last century and the first half of the present, almost until recent times, our thinking has been dominated by two major legal principles, namely, freedom of contract and sanctity of private property and therefore we are unable to readily accept that legal relationships can be created by statute despite want of contractual consensus and in derogation of  property rights of the landlord. We are unfortunately not yet reconciled to the idea that the law is moving forward from contract to status. Why can estate or interest in property not be created by statute? When the rent control legislation places a statutory tenant on the same footing as a contractual tenant, wipes out the distinction between the two and invests a statutory tenant with the same right, obligations and incidents as a contractual tenant, why should it be difficult to hold that, just like a contractual tenant, a statutory tenant also has estate or interest in the premises which can be inherited. Of course, strong reliance was placed on behalf of the landlord on section 2(iii) of the Delhi Rent Control Act, 1958 to combat this conclusion but that provision merely limits or circumscribes the nature and extent of the protection that should be available on the death of a statutory tenant in respect of residential premises. It does not confer a new right of heritability which did not exist allude. Justice Amarendra Nath Sen vide a detailed reasoning.

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By Amarendra Nath Sen J, rejected the contention of the landlord/respondent that on the determination of the statutory tenancy the tenancy comes to an end and the tenant ceased to have any estate or interest in the premises. First argument vis-a-vis loss of estate interest in the tenanted premises:-It was contended that on determination of tenancy the tenant becomes liable to be evicted under the general law of land;  but the rent control legislation affords protection to the tenant against such eviction inasmuch as the Act provides that in respect of the termination of the tenancy, no order or decree for  possession shall be passed against the tenant, unless any of the grounds mentioned in the Act, which entitles the landlord to recover possession of the premises from the tenant, is established. Thus, it was contended that protection afforded to the tenant under the Act is against eviction except on grounds recognized by the Act and therefore the protection is only in the nature of  personal protection p rotection to the tenant who continues to remain in possession after the termination of the tenancy. In nutshell the contention was that the tenant loses the estate or interest in the tenanted premises after termination of the statutory tenancy and the tenant by virtue of the Act is afforded only a protection against eviction. Hence, the heirs of such tenants after his death acquire no interest or estate in the premises, because the deceased tenant had none and they can also claim no protection against eviction as the protection under the Act is personal to the tenant as long as the tenant continues to remain in possession of the premises after the determination of the tenancy. In other words, the protection against eviction after termination of tenancy afforded to the tenant by the Act creates a personal right in favour of the tenant, who continues to remain in possession after termination of his tenancy without any estate or interest in the premises; and therefore on the death of such a tenant, his heirs who have neither any estate nor interest in the tenanted premises, who did not have any protection under the Act against eviction, are liable to  be evicted as a matter of course under the ordinary law of land. In this regard, landlord/respondent relied upon various decisions including those of High Courts, English Courts and also passages from Halsbury's Laws of England and other eminent English authors; Gian Devi Anand v. Jeevan Kumar, MANU/SC/0381/1985: (1985) 2 SCC 683 (688-715). With regard to the English Law cited before the Court it was held that the same cannot be relied upon because the provisions of the English Rent Acts are not in pari materia with the provisions of the Act in question or the other Rent Acts prevailing in other States in India. The English Rent

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Acts which have come into existence from time to time were no doubt introduced for the benefit of the tenants. It may be noted that the term "statutory tenant" which is not to be found in the Act in question or in the other analogous Rent Acts in force in other States in India, is indeed a creature of the English Rent Act. English Rent Act, 1977 which was enacted to consolidate the Rent Act, 1968, parts III, IV and VIII of the Housing Finance Act, 1972, the Rent Act, 1974, sections 7 to 10 of the Housing Rents and Subsidies Act, 1975 and certain related enactments, with amendments to give effect to recommendation of the Law Commission, speaks of protected tenants and tenancies in section 1 and defines statutory tenant in section 2. English Rent Act, 1977 is in the nature of a complete Code governing the rights and obligations of the landlord and the tenant and their relationship in respect of tenancies covered by the Act. As the provisions of the English Act, are materially different from the provisions of the Act in question and other Rent Control Acts, in force in other States in India, the decisions of the English Courts and the  passages from the various authoritative books including the passages from Halsbury which are all concerned with English Rent Acts are not of any particular assistance in deciding the question involved in this appeal. As already noticed, the term 'statutory tenant' is used in English Rent Act and though this term is not found in the Indian Acts, in the Judgments of this Court and also of the various High Courts in India, this term has often been used to denote a tenant whose contractual tenancy has been terminated but who has become entitled to continue to remain in  possession by virtue of the protection afforded to him by the statutes in question, namely, the various Rent Control Acts, prevailing in different States of India.

HERITABILITY OF STATUTORY TENANCY 13

In Damadi Lal v. Parashram,

the question arose was whether the heirs of the statutory tenant

had any heritable interest in the demised premises and had the right to prosecute the appeal in the High Court on the death of the statutory tenant. A statutory tenant, meaning a tenant whose tenancy has determined but who continues in  possession, has no power of subletting. A statutory tenant has no interest in the premises occupied by him, and he has no estate to assign or transfer. A statutory tenant is, as we have already observed, a person who on determination of his contractual right, is permitted to remain

13

 Damadi Lal v. Parashram, 1976 (4) SCC 855

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in occupation so long as he observes and performs the conditions of the tenancy and pays the standard rent and permitted increases. His personal right of occupation is incapable of being transferred or assigned, and he having no interest in the property there is no estate on which subletting may operate. A tenant whose contractual tenancy has determined but who is protected against eviction by the statute has no right of property but only a personal right to remain in occupation, without ascertaining what his rights are under the statute. The concept of a statutory tenant having no estate or property in the premises which he occupies is derived from the provisions of the English Rent Acts. But it is not clear how it can be assumed that the position is the same in this country without any reference to the provisions of the relevant statute. Tenancy has its origin in contract. There is no dispute that a contractual tenant has an estate or property in the subjectmatter of the tenancy, and heritability is an incident of the tenancy. It cannot be assumed, however, that with the determination of the tenancy the estate must necessarily disappear and the statute can only preserve his status of irremovability and not the estate he had in the premises in his occupation. It is not possible to claim that the 'sanctity' of contract cannot be touched by legislation, it is therefore necessary to examine the provisions of the Madhya Pradesh Accommodation Control Act, 1961 to find out whether the respondents' predecessors-in-interest retained a heritable interest in the disputed p remises even after the termination of their tenancy. Ganpat Ladha's case.In order to appreciate the question, the Court thought it necessary to understand the kind of  protection that is sought to be afforded to a tenant under the Rent Acts and his status after the termination of the contractual tenancy under the Rent Acts. It is not in dispute that so long as the contractual tenancy remains subsisting, the contractual tenancy creates heritable rights; and, on the death of a contractual tenant, the heirs and legal representatives step into the position of the contractual tenant; and, in the same way on the death of a landlord the heirs and legal representatives of a landlord become entitled to all the rights and privileges of the contractual tenancy and also come under all the obligations under the contractual tenancy. A valid termination of the contractual tenancy puts an end to the contractual relationship. On the determination of the contractual tenancy, the landlord becomes entitled under the law of the land to recover possession of the premises from the tenant in due process of law and the tenant under

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the general law of the land is hardly in a position to resist eviction, once the contractual tenancy has been duly determined. Because of scarcity of accommodation and gradual high rise in the rents due to various factors, the landlords were in a position to exploit the situation for unjustified personal gains to the serious detriment of the helpless tenants. Under those circumstances it became imperative for the legislature to intervene to protect the tenants against harassment and exploitation by avaricious landlords and appropriate legislation came to be  passed in all the States and Union Territories where the situation required an interference by the legislature in this regard. It is no doubt true that the Rent Acts are essentially meant for the  benefit of the tenants. It is, however, to be noticed that the Rent Acts at the same time also seek to safeguard legitimate interests of the landlords. The Rent Acts which are indeed in the nature of social welfare legislation are intended to protect tenants against harassment and exploitation by landlords, safeguarding at the same time the legitimate interests of the landlords. The Rent Acts seek to preserve social harmony and promote social justice by safeguarding the interests of the tenants mainly and at the same time protecting the legitimate interests of the landlords. Though the purpose of the various Rent Acts appear to be the same, namely, to promote social justice by affording protection to tenants against undue harassment an d exploitation by landlords, providing at the same time for adequate safeguards of the legitimate interests of the landlords, the Rent Acts undoubtedly lean more in favour of the tenants for whose benefit the Rent Acts are essentially passed. It may also be noted that various amendments have been introduced to the various Rent Acts from time to time as and when situation so required for the purpose of mitigating the hardship of tenants.

14

Keeping in view the main object of rent control legislation, the position of a tenant whose contractual tenancy has been determined has to be understood in the light of the provisions of the Rent Acts. Though provisions of all the Rent Control Acts, are not uniform, the common feature of all the rent control legislation is that a contractual tenant on the termination of the contractual tenancy is by virtue of the provisions of the Rent Acts not liable to be evicted as a matter of course under the ordinary law of the land and he is entitled to remain in possession even after determination of the contractual tenancy and no order or decree for eviction will be passed against a tenant unless any ground which entitles the landlord to get an order or decree for

14

 Gian Devi Anand v. Jeevan Kumar, MANU/SC/0381/1985: (1985) 2 SCC 683 (688-715).

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 possession specified in the Act is established. In other words, the common feature of every Rent R ent Control Act, is that it affords protection to every tenant against eviction despite termination of tenancy except on grounds recognized by the Act and no order or decree for eviction shall be 15

 passed against the tenant unless any such ground is established to the satisfaction of the Court.

The Court also held that it cannot be assumed that with the determination of the tenancy, the estate must necessarily disappear and the statute can only preserve the status of irremovability and not the estate he has in the premises in his occupation; and it is not possible to claim that the sanctity of contract cannot be touched by legislation. As already noticed, this Court in Damadilal's case (supra) after referring mainly to the definition of tenant in section 2(i) of the Madhya Pradesh Accommodation Control Act, 1961 came to the conclusion that the so-called statutory tenant had an interest in the premises occupied by him and the heirs of the statutory tenant "had a heritable interest in the premises". Thereafter the Court analysed the provision of the Delhi Act to decide whether there is anything in the other provisions to indicate that the tenant as defined in section 2(1)(ii) will stand on any different footing from a contractual tenant in the matter of enjoyment of protection and benefits sought to be afforded on a tenant by the Act. It was observed: Analysis of various provisions of Delhi Act.-"Section 2(e) defines landlord and clearly indicates that the landlord continues to be the landlord for the purpose of the Act even after termination of the contractual tenancy. Section 2(l) which defines 'tenant' has been set out earlier in its entirety. We shall consider the true effect of section 2(l)(iii) on which as earlier noted, reliance has been  placed by the learned Counsel of the landlords, when we deal with the argument which has been advanced on the basis of this sub-section. Section 3 mentions premises which are outside the  purview of this Act and has no bearing on the question involved. Chapter II of the Act consists of sections 4 to 13 and makes provision regarding rent. These sections indicate that they are applicable to tenants as defined in section 2(l) including 2(l)(iii). Chapter III consists of sections 14 to 25 of the Act and deals with eviction and control of eviction of tenants. Section 14 starts as follows:    7     2 15

 Gian Devi Anand v. Jeevan Kumar, MANU/SC/0381/1985: (1985) 2 SCC 683 (688-715).

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"Notwithstanding anything to the contrary contained in any other law or contract, no order or decree for the recovery of possession of any premises shall be made by any Court or Controller in favour of the landlord against a tenant;" Thereafter various provisions are made as to grounds and under what circumstances a decree for eviction may be passed. This section, therefore, clearly postulates that despite the termination of the tenancy and notwithstanding the provisions of any other law which might have been applicable on the termination of the contractual tenancy, protection against eviction is applicable to every tenant as defined in section 2(l) of the Act. This section clearly establishes that determination of a contractual tenancy does not disqualify him from continuing to be a tenant within the meaning of this Act and the tenant whose contractual tenancy has been determined enjoys the same position and is entitled to protection against eviction. The other sections in this chapter also indicates that the tenant whose tenancy has been terminated enjoys the same status and benefit as a tenant whose tenancy has not been terminated, and a tenant after termination of his tenancy stands on the same footing as the tenant before such termination. Chapter IIIA which  provides for summary summar y trial for certain applications also does not make any distinction between a tenant whose tenancy has been determined and a tenant whose tenancy had not been terminated. Chapter IV which deals with deposit of rent consists of sections 26 to 29 and these sections make it clear that the tenant after determination of a tenancy is treated under the Act on the same footing as a tenant whose tenancy has not been determined. Chapter V which consists of sections 30 to 34 deals with hotels and lodging houses and does not have any relevance to the question involved. Chapter VI which consists of sections 35 to 43 provides for appointment of Controllers and their powers and functions and also makes provisions with regard to appeals. This Chapter though not very material for the purpose of adjudication of the point involved indicates that no discrimination is made in the matter of proceedings for eviction between the so called 'statutory tenant' and a 'contractual tenant'. Chapter VII which consists of sections 44 to 49 makes  provisions regarding obligations of landlords and also provides for penalties in appropriate cases. The sections make it clear that the duties and obligations cast upon the landlord apply equally whether the tenant is a so called 'statutory tenant' or the tenant is a 'contractual tenant'. Chapter VIII which makes various miscellaneous provisions does not have any bearing on the question involved. It may, however, be noted that section 50 which bars the jurisdiction of Civil Courts in respect of certain matters does not in any way discriminate between a 'so-called statutory tenant'

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and a contractual tenant. The provisions of the Act, therefore, make it abundantly clear that the Act does not make any distinction between a 'so-called statutory tenant' and a contractual tenant and the Act proceeds to treat both alike and to preserve and protect the status and rights of a tenant after determination of the contractual tenancy in the same way as the status and rights of a contractual tenant are protected and preserved." Dhanpal Chettiar's cases."Once the liability to be evicted is incurred by the tenant, he cannot turn round and say that the contractual lease has not been determined. The action of the landlord in instituting a suit for eviction on the ground mentioned in any State Rent Act will be tantamount to an expression of his intention that he does not want the tenant to continue as his lessee and the jural relationship of lessor and lessee will come to an end on the passing of an order or a decree for eviction. Until then, under the extended definition of the word 'tenant' under the various State Rent Acts, the tenant continues to be a tenant even though the contractual tenancy has been determined by giving a valid notice under section 106 of the Transfer of Property Act. In many cases, the distinction between a contractual tenant and a statutory tenant was alluded to for the purpose of elucidating some particular aspects which cropped up in a particular case. That led to the criticism of that expression in some of the decisions. Without detaining ourselves on this aspect of the matter by any elaborate discussion, in our opinion, it will suffice to say that the various State Rent Control Acts, make a serious encroachment in the field of freedom of contract. It does not permit the landlord to snap his relationship with the tenant merely by his Act of serving a notice to quit on him. Inspite of the notice, the law says that he continues to be a tenant and he does so enjoying all the rights of a lessee and is at the same time deemed to be under all the liabilities such as payment of rent etc. in accord ance with the law." These observations were made by a seven-Judge Bench of this Court. It is no doubt true that these observations were made while considering the question of requirement of a notice under section 106 of the Transfer of Property Act, 1882 before the institution of suit for recovery of  possession of premises to which the Rent Act applies. These observations, however, clearly go to establish that mere determination of the contractual tenancy does not in any way bring about any change in the status of a tenant. As aptly observed in this decision, "it will suffice to say that the various State Rent Control Acts, make a serious encroachment in the field of freedom of

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contract. It does not permit the landlord to snap his relationship with the tenant merely by his act of serving a notice to quit on him. In spite of the notice, the law says that he continues to be a tenant and he does so, enjoying all the rights of a lessee and is at the same time deemed to be under all the liabilities such as payment of rent etc. in accordance with the law. Further argument of Amendment of 1976 with retrospective effect in Delhi Act.-Thereafter, the Court dealt with the further argument advanced on behalf of the landlord that the amendments to the definition of the tenant with retrospective effect introduced by the Delhi Rent Control Act (Amendment Act) (Act 18 of 1976) to give personal protection and personal right of continuing in possession to the heirs of the deceased statutory tenant in respect of residential premises only and not with regard to the heirs of the 'so-called statutory tenant' in respect of commercial  premises, indicates that the heirs 'so-called statutory tenant' therefore, do not enjoy any  protection under the Act. It was observed that this argument proceeds on the basis that in the absence of any specific right created in favour of the 'so-called statutory tenant' in respect of first tenancy, the heirs of statutory tenant who do not acquire any interest or estate in the tenanted  premises, become liable to be evicted as a matter of course. The Court held that the very premise on the basis of which the argument is advanced is unsound. The termination of the contractual tenancy in view of the definition of the 'tenant' in the Act does not bring out any change in the status and legal position of the tenant, unless there are contrary provisions in the Act and the tenant notwithstanding termination of the tenancy does enjoy an estate or interest in the tenanted  premises. This interest or estate which the tenant under the Act despite termination of the contractual tenancy continues to enjoy creates a heritable interest in the absence of any provision to the contrary. Supreme Court observed that this view has been taken in Damadilal's case and this decision represents the correct position in law. The observations of Supreme Court in the decision of the Seven-Judge Bench in the case of V. Dhanpal Chettiar v. Yesodai Ammal (supra), appears to have concluded the question. The amendment of the definition of tenant by the Act 18 of 1976 introducing particularly 2(l)(iii) does not in any way mitigate against this view. The said sub-section (iii) with all the three Explanations thereto is not in any way inconsistent with or contrary to sub-section (ii) of section 2(l) which unequivocally states that tenant includes any person continuing in possession after the termination of his tenancy. In the absence of the provision contained in sub-section 2(l)(iii) the

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heritable interest of the heirs of the statutory tenant would devolve on all the heirs of the 'socalled statutory tenant' on his death and the heirs of such tenant would in law step into his  position. This sub-section (iii) of section 2(l) seeks to restrict this right insofar as the residential  premises are concerned. The heritability of the statutory tenancy ten ancy which otherwise flows from the Act is restricted in case of residential premises only to the heirs mentioned in section 2(l)(iii) and the heirs therein are entitled to remain in possession and to enjoy the protection under the Act in the manner and to the extent indicated in sub-section 2(l). The legislature, which under the Rent Act affords protection against eviction to tenants whose tenancies have been terminated and who continue to remain in possession and who are generally termed as statutory tenants, is perfectly competent to lay down the manner and extent of the protection and the rights and obligations of such tenants and their heirs. Section 2(l)(iii) of the Act does not create any additional or special right in favour of the heirs of the 'so-called statutory tenant' on his death, but seeks to restrict the right of the heirs of such tenant in respect of residential premises. As the status and rights of contractual tenant even after determination of his tenancy when the tenant is at times described as the statutory tenant, are fully protected by the Act and the heirs of such tenants become entitled by virtue of the provisions of the Act to inherit the status and position of the statutory tenant on his death, the legislature which has created this right has thought it fit in the case of residential premises to limit the rights of the heirs in the manner and to the extent provided in section 2(l). It appears that the legislature has not thought it fit to put any such restrictions with regard to tenants in respect of commercial premises in this Act. Distinction between commercial and residential premises:- The Court also noted that for certain  purposes the legislature in the Delhi Act in question and also in various other Rent Acts has treated commercial premises differently from residential premises. Section 14(1)(d) provides that it will be a good ground for eviction of a tenant from residential premises, if the premises let out for use as residence is not so used for a period of six months immediately before the filing of the application for the recovery of possession of the premises. Similarly, section 14(1)(e) makes  bona fide requirement of the landlord of the premises let out to the tenant for residential purposes a good ground for eviction of the tenant from such premises. These grounds, however, are not made available in respect of commercial premises. Though recently the Apex Court by way of Indicial acticism made the ground of bona fide requirement available even in cases of commercial premises also.

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Intention of legislature:-A tenant of any commercial premises has necessarily to use the premises for business purposes. Business carried on by a tenant of any commercial premises may be and often is, his only occupation and the source of livelihood of the tenant and his Intention of legizlature family. Out of the income earned by the tenant from his business in the commercial  premises, the tenant maintains himself and his family; and the tenant, if he is residing in a tenanted house, may also be paying his rent out of the said income. Even if tenant is evicted from his residential premises, he may with the earnings out of the business be in a position to arrange for some other accommodation for his residence with his family. When, however, a tenant is thrown out of the commercial premises, his business which enables him to maintain himself and his family comes to a stand-still. It is common knowledge that it is much more difficult to find suitable business premises than to find suitable premises for residence. It is no secret that for securing commercial accommodation, large sums of money by way of salami, even though not legally payable, may have to be paid and rents of commercial premises are usually very high. Besides, a business which has been carried on for years at a particular place has its own goodwill and other distinct advantages. The death of the person who happens to be the tenant of the commercial premises and who was running the business out of the income of which the family used to be maintained, is itself a great loss to the members of the family to whom the death, naturally, comes as a great blow. Usually, on the death of the person who runs the business and maintains his family out of the income of the business, the other members of the family who suffer the bereavement have necessarily to carry on the business for the maintenance and support of the family. A running business is indeed a very valuable asset and often a great source of comfort to the family as the business keeps the family going. So long as the contractual tenancy of a tenant who carries on the business continues, there can be no question of the heirs of the deceased tenant not only inheriting the tenancy but also inheriting the business and they are entitled to run and enjoy the same. As already noted, mere termination of the contractual tenancy does not bring about any change in the status of the tenant and the tenant by virtue of the definition of the 'tenant' in the Act and the other Rent Acts continues to enjoy the same status and  position unless there be any provisions p rovisions in the Rent Acts which indicate to the contrary. The mere fact that in the Act no provision has been made with regard to the heirs of tenants in respect of commercial tenancies on the death of the tenant after termination of the tenancy, as has been done in the case of heirs of the tenants of residential premises, does not indicate that the

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legislature intended that the heirs of the tenants of commercial premises will cease to enjoy the  protection afforded to the tenant under the Act. The legislature could never have possibly intended that with the death of a tenant of the commercial premises, the business carried on by the tenant, however flourishing it may be and even if the same constituted the source of livelihood of the members of the family, must necessarily come to an end on the death of the tenant, only because the tenant died after the contractual tenancy had been terminated. It could never have been the intention of the legislature that the entire family of a tenant depending upon the business carried on by the tenant will be completely stranded and the business carried on for years in the premises which had been let out to the tenant must stop functioning at the premises which the heirs of the deceased tenant must necessarily vacate, as they are afforded no protection under the Act. The Apex Court opined that in case of commercial premises governed by the Delhi Act, the legislature has not thought it fit in the light of the situation at Delhi to place any kind of restriction on the ordinary law of inheritance with regard to succession. It may also be  borne in mind that in case of commercial premises the heirs of the deceased tenant not only succeed to the tenancy rights in the premises but they succeed to the business as a whole. It might have been open to the legislature to limit or restrict the right of inheritance with regard to the tenancy as the legislature had done in the case of the tenancies with regard to the residential houses but it would not have been open to the legislature to alter under the Rent Act, the Law of Succession regarding the business which is a valuable heritable right and which must necessarily devolve on all the heirs in accordance with law. The absence of any provision restricting the heritability of the tenancy in respect of the commercial premises only establishes that commercial tenancies notwithstanding the determination of the contractual tenancies will devolve on the heirs in accordance with law and the heirs who step into the position of the deceased tenant will continue to enjoy the protection afforded by the Act and they can only be evicted in accordance with the provisions of the Act. Another significant consideration.-There is another significant consideration, which lends support to this view that commercial premises are let out not only to individuals but also to Companies, Corporations and other statutory bodies having a juristic personality. In fact, tenancies in respect of commercial premises are usually taken by Companies and Corporations. When the tenant is a Company or a Corporation or anybody with juristic personality, question of the death of the tenant will not arise. Despite the termination of the tenancy, the Company or the

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Corporation or such juristic personalities, however, will go on enjoying the protection afforded to the tenant under the Act. It can hardly be conceived that the legislature would intend to deny to one class of tenants, namely, individuals the protection which will be enjoyed by the other class' namely, the Corporations and Companies and other bodies with juristic personality under the Act. If it be held that commercial tenancies after the termination of the contractual tenancy of the tenant are not heritable on the death of the tenant and the heirs of the tenant are not entitled to enjoy the protection under the Act, an irreparable mischief which the legislature could never have intended is likely to be caused. Any time after the creation of the contractual tenancy, the landlord may determine the contractual tenancy, allowing the tenant to continue to remain in  possession of the premises, hoping for an early death of the tenant, so that on the death of a tenant he can immediately proceed to institute the proceeding for recovery and recover  possession of the premises as a matter of o f course, cou rse, because the heirs would wou ld not have any right to remain in occupation and would not enjoy the protection of the Act. This could never have been intended by the legislature while framing the Rent Acts for affording protection to the tenant against eviction that the landlord would be entitled to recover possession, even no grounds for eviction as prescribed in the Rent Acts are made out. Consequently the Court held that if the Rent Act in question defines a tenant in substance to mean a tenant who continues to remain in possession even after the termination of the contractual tenancy till a decree for eviction against him is passed. The tenant even after the determination of the tenancy continues to have an estate or interest in the tenanted premises and the tenancy rights both in respect of residential premises and commercial premises are heritable. The heirs of the deceased tenant in the absence of any provision in the Rent Act to the contrary will step into the position of the deceased tenant and all the rights and obligations of the deceased tenant including the protection afforded to the deceased tenant under the Act will devolve on the heirs of the deceased tenant. As the protection afforded by the Rent Act to a tenant after determination of the tenancy and to his heirs on the death of such tenant is a creation of the Act for the benefit of the tenants, it is open to the legislature which provides for such  protection to make appropriate provisions p rovisions in the Act with regard to the nature and an d extent of the  benefit and protection to be enjoyed and the manner in which the same is to be enjoyed. If the legislature makes any provision in the Act limiting or restricting the benefit and the nature of the  protection to be enjoyed in a specified manner by any particular class of heirs of the deceased

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tenant on any condition laid down being fulfilled, the benefit of the protection has necessarily to  be enjoyed on the fulfilment of the condition in the manner and to the extent stipulated in the Act. The legislature which by the Rent Act seeks to confer the benefit on the tenants and to afford protection against eviction, is perfectly competent to make appropriate provision regulating the nature of protection and the manner and extent of enjoyment of such tenancy rights after the termination of contractual tenancy of the tenant including the rights and the nature of protection of the heirs on the death of the tenant. Such appropriate provision may be made by the legislature both with regard to the residential tenancy and commercial tenancy. It is, however, entirely for the legislature to decide whether the legislature will make such provision or not. In the absence of any provision regulating the right of inheritance, and the manner and extent thereof and in the absence of any condition being stipulated with regard to the devolution of tenancy rights on the heirs on the death of the tenant, the devolution of tenancy rights must necessarily be in accordance with the ordinary law of succession. Further, before concluding the judgment, the Court made the following mentioned observation for the suitable amendment in the rent control legislation: "Before concluding, there is one aspect on which we consider it desirable to make certain observations. The owner of any premises, whether residential or commercial, let out to any tenant, is permitted by the Rent Control Acts, to seek eviction of the tenant only on the ground specified in the Act, entitling the landlord to evict the tenant from the premises. The restrictions on the power of the landlords in the matter of recovery of possession of the premises let out by him to a tenant have been imposed for the benefit of the tenants. In spite of various restrictions  put on the landlord's right to recover possession of the premises from a tenant, the right of the landlord to recover possession of the premises from the tenant for the bona fide need of the  premises by the landlord is recognized by the Act, in case of residential premises. A landlord may let out the premises under various circumstances. Usually a landlord lets out the premises when he does not need it for own use. Circumstances may change and a situation may arise when the landlord may require the premises let out by him for his own use. It is just and proper that when the landlord requires the premises bona fide for his own use and occupation, the landlord should be entitled to recover the possession of the premises which continues to be his property in spite of his letting out the same to a tenant. The legislature in its wisdom did recognize this fact

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and the legislature has provided that bona fide requirement of the landlord for his own use will  be a legitimate ground under the Act, for the eviction of his tenant from any residential premises. This ground is, however, confined to residential premises and is not made available in case of commercial premises. A landlord who lets out commercial premises to a tenant under certain circumstances may need bona fide the premises for his own use under changed conditions in some future date should not in fairness be deprived of his right to recover the commercial  premises. Bona fide need of the landlord will stand very much on the same sa me footing in regard to either class of premises, residential or commercial. We therefore, suggest that legislature may consider the advisability of making the bona fide requirement of the landlord a ground of eviction in respect of commercial premises as well; Gian Devi Anand v. Jeevan Kumar, MANU/SC/0381/1985: (1985) 2 SCC 683 (688-715)." It is pertinent to mension here that the Supreme Court subsequent in Satyawati Sharma v. UOI, 2008 (6) SCALE 325, has extended the ground of bona fide requirement for eviction of the tenant even to business premises also after relying upon Gian Devi's judgment.

THE PRINCIPLES LAID DOWN IN GIAN DEVI'S CASE WITH REGARD TO HERITABILITY OF TENANCY.

1. A seven Judges Bench decision on V. Dhanpal Chettiar v. Yesodai Desi' Judgement Ammal, has completely obliterated the distinction between the contractual tenancy and statutory tenancy therefore if a contractual tenant has an estate or interest in the premises which is heritable, it is difficult to understand why a statutory tenant should be held not no t to have such heritable estate or interest. In one case, the estate and interest is the result of contract while in the other result of statute. 2. The English law, which has been relied upon to distinguish between the statutory tenancy and the contractual tenancy in India, cannot be made applicable to our country, since English Rent Acts are not in pari materia with the provision of the rent control legislation  prevailing in different States of our country. 3. Even rent control legislation places a statutory tenant on the same footing as the contractual tenant with the same rights and obligations. It does not make any distinction  between the statutory tenant ten ant and a contractual tenant which is apparent ap parent from bare perusal

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of various provisions of the rent control legislation including the definition of the tenant, grounds of eviction, provisions relating to fixation of standard rents etc. None of these  provisions use either of the terms namely statutory or contractual. Rather, it makes reference to only 'tenant' and not to statutory or contractual tenant. 4. Tenancy has its origin in contract. There is no dispute that contractual tenant has estate or interest in the subject-matter of the tenancy. If a contractual tenant has an estate or interest in the premises which is heritable, it is difficult to understand why a statutory tenant should be held not to have such heritable estate or interest. In one case, the estate or interest is the result of contract while in the other it is the result of statute. But the quality of the estate or interest is the same in both cases. 5. By making amendment in the year 1976 in the definition of 'tenant', legislature has put certain restrictions with regard to the heritability of statutory tenancy in respect of residential premises. In view of these amendments only those legal representatives as mentioned in the amended provisions and subject to the contentions mentioned therein, can inherit the same. However, in respect of commercial premises no such restriction has  been put with regard to its heritability. 6. The legislature could never have possibly intended that with the death of a tenant of the commercial premises, the business carried on by the tenant, however flourishing it may  be and even if the same constituted the source of livelihood of the members of the family, must necessarily come to an end on the death of the tenant, only because the tenant died after the contractual tenancy had been terminated. It could never have been the intention of the legislature that the entire family of a tenant depending upon the business carried on  by the tenant will be completely stranded and the business carried on for years in the  premises which had been let out to the tenant must stop functioning at the premises which the heirs of the deceased tenant must necessarily vacate, as they are afforded no  protection under the Act. 7. It might have been open to the legislature to limit or restrict right of inheritance with regard to the tenancy as the legislature had done in case of tenancy with regard to the residential houses. But it would not have been open to the legislature to alter under the Rent Act, the law of succession regarding the business which is the valuable right and which must necessarily devolve upon all the heirs in accordance with the law.

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8. Commercial premises are let out not only to individuals but also to Companies, Corporations and other statutory bodies having a juristic personality. In fact, tenancies in respect of commercial premises are usually taken by Companies and Corporations. When the tenant is a Company or a Corporation or anybody with juristic personality, question of the death of the tenant will not arise. Despite the termination of the tenancy, the Company or the Corporation or such juristic personalities, however, will go on enjoying the protection afforded to the tenant under the Act. It can hardly be conceived that the legislature would intend to deny to one class of tenants, namely, individuals the  protection which will be enjoyed by the other class namely, the Corporations and Companies and other bodies with juristic personality under the Act. If it be held that commercial tenancies after the termination of the contractual tenancy of the tenant are not heritable on the death of the tenant and the heirs of the tenant are not entitled to enjoy the  protection under the Act, an irreparable mischief which the legislature could co uld never have intended is likely to be caused. 9. Thus law laid down in Damadi Lal case was affirmed while over-ruling Ganpat Ladha's  judgment.

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RENT CONTROL LEGISLATION On account of rapid growth of population in urban areas, landlords were tempted to terminate the tenancy of the existing tenants and asked for their eviction in order to let out the premises to the new tenants at high rents. Therefore, various States passed their respective rent control legislations for the first time during the second world war and since then there have been a rent control legislations applicable to various urban areas in different States, whose provisions are almost pari materia to each other, because they were enacted to provide for control of rents and evictions. We would be discussing provisions regarding rent with special reference to the Delhi Rent Control Act, 1958.

PROVISIONS REGARDING RENT WITH SPECIAL REFERENCE TO THE DELHI R ENT ENT CONTROL ACT, 1958 Chapter 2 deals with provisions regarding rent. The chapter starts with section 4 which specifically puts bar on recovery of rent in excess of standard rent unless such amount is lawful increase of the standard rent in accordance with the provisions of the Act. The definition of 'standard rent' contained in section 2(k) that the standard rent of a building means the standard rent referred to in section 6 or where the standard rent has been increased under section 7, such increased rent. This definition is not an inclusive but an exhaustive definition and it defines the standard rent to mean either the standard rent referred to in section 6 or the increased standard rent under section 7. It is significant to note that it does not contain any reference to section 9, sub-section (4). Whenever, therefore, any reference is made to standard rent in any provision of the Rent Act, it must mean standard rent as laid down in section 6 or increased standard rent as  provided in section 7 and nothing no thing more. Section 6 lays down the principles for determination of standard rent in almost all conceivable classes of cases and section 7 provides for increase in the standard rent where the landlord has incurred expenditure for any improvement, addition or structural alteration in the premises. Section 9, as the definition in section 2(k) clearly suggests and the marginal note definitely indicates, does not define what is standard rent but merely lays down the procedure for fixation of standard rent. The compulsive force of the formulae laid down in section 6 for the determination of standard rent and of the provisions of section 7 for increase in standard rent is not in any way whittled down by sub-section (2) of section 9 but a

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marginal discretion is given to the Controller to mitigate the rigour of the formulae where the circumstances of the case so require. The only discretion given to him is to make adjustments in the result arrived at on the application of the relevant formula, where it is necessary to do so by reason of the fact that the landlord might have made some alteration or improvement in the  building or circumstances might have h ave transpired affecting the condition or utility of the building or some such circumstances of similar character. Even while fixing such rent, the Controller does not enjoy unfettered discretion to do what he likes and he is bound to take into account the standard rent payable in respect of similar or nearly similar premises in the locality. The standard rent determinable on the principles set out in section 6, therefore, again becomes a governing consideration. The legislature obviously did not intend to vest unguided discretion in the Controller to fix such rent as he considers reasonable without any principles or norms to guide him and, therefore, it provided that in fixing reasonable rent, the Controller shall take into account the standard rent payable in respect of similar or nearly similar premises. The Controller must derive guidance from the standard rent of similar or nearly similar premises in the locality and apart from discharging the function of affording guidance to the Controller in fixing reasonable rent, this requirement also seeks to ensure that there is no wide disparity between the reasonable rent of the premises fixed by the Controller and the standard rent of similar or nearly similar premises situate in the locality. The process of reasoning which the Controller would have to follow in fixing reasonable rent would, therefore, be first to ascertain what is the standard rent payable in case of similar or nearly similar premises in the locality, and then to co nsider how far such standard rent in its application to the premises, needs adjustment having regard to the situation, locality and condition of the premises and the amenities provided therein. The reasonable rent so determined would be the standard rent of the premises fixed by the Controller. There may, however, be cases where there are no similar or nearly similar premises in the locality and in such cases guideline to the Controller would not be available and the Controller would have to determine as best as he can what rent would be reasonable having regard to the situation, locality and condition of the premises and the amenities provided therein. But such cases would by their very nature be extremely rare and even there, the Controller would not be on an uncharted sea: he would have to fix the reasonable rent of the premises taking into account     0     4    e    g    a     P

the standard rent of similar or nearly similar premises in the adjoining locality and making 16

necessary adjustments in such standard rent.

THE PROCEDURE FOR THE LANDLORD TO INCREASE THE RENT CONTRACTED WITH THE TENANT 17

In Theeta Industrial Heating Equipments (P) Ltd. v. Harvinder Singh , it was observed that The mode and manner of exercising option by the landlord to claim increase in the rent is contained in section 8, which enjoins upon the landlord to serve a notice upon the tenant expressing and conveying his intention to make increase in the rent. The increased rent becomes due and recoverable on the expiry of 30 days from the date of the receipt of the same. Facts of the case: The defendant was let out a portion of the suit premises by Pritpal Singh, the father of the plaintiff at a rental of Rs. 1,350 p.m. through lease deed dated 30-9-1976. On additional portion being let out, the rent was enhanced to Rs. 2,800 p.m. On the death of Pritpal Singh, the plaintiff became the owner of the property on the basis of Will dated 24-2-1981 executed in his favour by Pritpal Singh. It is the admitted case of the parties that through lease agreement Ext. PW 1/2 dated 1-9-1982 the plaintiff let out the premises in question to the defendant on a monthly rent of Rs. 3,500. The agreement says that the lessor grants to the lessee the entire ground floor except one room in the right side of the main entrance, first floor and second floor in the property No. 487/79, Peera Garhi, Paschim Puri, Rohtak Road, Delhi for a  period of 11 months at a monthly rent of Rs. 3,500, for commercial factory purposes and the lessee shall have the option to renew the lease, on the same rent, for a further period of 11 months, on the same terms and conditions. On 2-7-1992 notice Ext. Public Witness 1/3 was served by the plaintiff on the defendant demanding enhancement in rent at the rate of 10% and calling upon the defendant to increase the rent to Rs. 3,850 p.m. while maintaining that the Delhi Rent Control Act, 1958 has no application to the premises. According to the defendant enhancement was not agreed upon. The defendant continued to remit rent at the rate of Rs. 3,500 p.m. Cheques were returned by the  plaintiff. It is stated that the plaintiff thereafter sent notice dated 19-12-1992 terminating the

16

 Dr. Balbir Singh v. M.C.D., MANU/SC/0222/1984: AIR 1985 SC 339. 17  Theeta Industrial Heating Equipments (P) Ltd. v. Harvinder Singh, 1996 (39) DRJ 739

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defendant's tenancy w.e.f. 30-6-1993. On failure to vacate, on the basis of notice dated 19-121992 the suit for eviction was filed. The defendant contested the suit inter alia on the grounds: that enhancement claimed by the  plaintiff was unwarranted and illegal and the same was demanded d emanded merely to oust the defendant from the protective umbrella of Delhi Rent Control Act, 1958; that even if lease agreement Ext. PW 1/2, dated 1-9-1982 was unregistered the same, in view of section 49 of the Registration Act, 1908, can be looked into as regards the mode of determination of tenancy, being a collateral  purpose and under the terms of the lease agreement the plaintiff had no right to terminate the lease; that the lease was for commercial factory purposes and the duration thereof will be from year to year and thus under law the plaintiff could have terminated the same only on serving six months' notice; the notice Ext. Public Witness 1/9 dated 19-12-1992 did not terminate the lease  by the end of the period of tenancy. The suit was decreed holding that on service of notice Ext. Public Witness 1/3 the rent stood enhanced to Rs. 3,850 p.m., as such the premises in question are governed by the general  provisions of the Transfer of Property Act, 1882 and not by the Delhi Rent Control Act, 1958, the tenancy was rightly terminated by due service of notice Ext .PW 1/9, the Court had  jurisdiction to try the suit and the defendant was liable to pay damages after the tenancy was terminated, which as per the prevailing rent in the locality was held to Rs. 20,000 p.m. The  judgment and decree passed by the Trial Court is now under challenge by the defendant  primarily on the ground that there has been b een no valid termination of tenancy. The plaintiff could c ould not have by his unilateral act enhanced the contractual rent from Rs. 3,500 to Rs. 3,850 and thereby debar the defendant from the protective umbrella of the Delhi Rent Control Act, 1958. Judgment and decree is also under challenge with regard to the quantum of damages granted at the rate of Rs. 20,000 p.m. Findings of the Court: The Division Bench of the Delhi High Court through Devender Gupta, Justice observed that there is a material difference between the rights which accrue to a landlord under the Common law and the protection which is afforded to the tenant under the Rent Control Legislation. In the former case the rights and remedies of the landlord and tenant are governed  by the law of contract and the law governing property relations. These rights and remedies continued to govern their relationship unless they are regulated by protective legislation, in

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which case the said rights and remedies remain suspended till the protective legislation continues to remain in operation. Landlord's normal rights, vested in him by the general law, thus, continue to exist till and so long they are not abridged by the special protective legislation. Likewise in the case of tenant the protective shield extended to him survive only so long and to the extent the special protective legislation operates. As such, in the case of a tenant, the protection does not create any vested right which can operate beyond the period of the protection or during the  period the protection is not no t in existence. When the protection does do es not exist the normal relations of landlord and tenant come into operation. It was further held that the theory of vested right, which may validly be pleaded in support of the landlord's case will not be available to the tenant where the tenant undoubtedly had the rights and remedies under the protective legislation, to claim reliefs against the landlord, lost the same, the moment the protection was taken away since rights and remedies being not vested ones. Undoubtedly under the protective legislation, namely, the Delhi Rent Control Act, 1958 the defendant had the protected umbrella and by virtue of the said protected umbrella he could have  been evicted only on o n the strength of an order passed by b y Controller appointed under the Act and that also on any of the grounds enumerated under the said Act. Right of the landlord to seek eviction of the tenant under the general law, merely on terminating the tenancy stood suspended and will be deemed to have remained under suspension so long as and to the extent the protective legislation operates. Delhi Rent Control Act, 1958 was amended by the Delhi Rent Control (Amendment) Act, 1988 (52 of 1988). Amendment came into effect from 1-12-1988. Section 3(c) of the amended Act  provided that the Delhi Rent Control Act, 1958 will not apply to any premises whose monthly rent exceeded Rs. 3,500. Interpretation and constitutional validity of section 3(c) of the Delhi 18

Rent Control (Amendment) Act, 1988 was upheld in D.C. Bhatia v. UOI . The protection against eviction, except on proof of specified grounds, provided under the Delhi Rent Control Act, 1958, which was available to the defendant, not being a vested right, in terms 19

of the ratio of the decision in Parripati Chandrasekhar Rao v. Alapati Jalaiah   , it will not be  permissible to uphold the contention raised on behalf of the defendant that the plaintiff could not, 18

 (1995) 1 SCC 104 19  (1995) 3 SCC 709

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 by his unilateral act, of serving a notice to enhance the rent, remove the protected shield available to him. On a combined reading of sections 6A and 8 of the Delhi Rent Control Act, 1958 it cannot be disputed that the landlord will be entitled to claim increase in the rent of the  premies by 10% after every three years. Section 6A of the Act says that notwithstanding anything contained in the Act the standard rent or where no standard rent is fixed under the  provisions of this Act in respect of an y premises, the rent agreed upon between bet ween the landlord and tenant may be increased by 10% every three years. Admittedly agreed rent was Rs. 3,500, which was fixed in the year 1981. Landlord under section 6A of the Act as of a right could claim increase by 10%. The mode and manner of exercising the option by the landlord to claim increase in the rent is contained in section 8, which enjoins upon the landlord to serve a notice upon the tenant expressing and conveying his intention to make increase in the rent. The increased rent becomes due and recoverable on the expiry of 30 days from the date on which notice is given. It is not disputed that notice Ext. PW 1/2 in writing was sent on behalf of the  plaintiff in the manner as provided in section 8 of the Delhi Rent Control Act, 1958. The enhancement in rent became effective on the expiry of 30 days from the date of receipt of the letter. With regard to the challenge to the impugned judgment on the ground of requiring six months notice to determine the lease it was held that an unregistered lease for manufacturing purpose cannot be deemed to be an yearly lease for the purpose of notice of termination, in view of the  provisions contained in section 107 of the Transfer of Property Act, 1882. Consequetly, it was held that, the notice terminating tenancy in the instant case could not be held to be invalid and no interference was called for in the impugned judgment of the Trial Court holding that the tenancy of the defendant was rightly terminated.

PREMISES : EXEMPTION FROM APPLICABILITY OF R ENT ENT CONTROL LEGISLATION With specific reference to the Delhi Rent Control Act, 1958 it is submitted that section 3  provides that the Act shall not apply (a) to any premises belonging to the Government; (b) to any tenancy or other like relationship created by a grant from the Government in respect of the  premises taken on lease, or requisitioned, by the Government: Provided that th at where any an y premises  belonging to Government have been or are lawfully let by any an y person by b y virtue of an agreement with the Government or otherwise, then, notwithstanding any judgment, decree or order of any

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court or other authority, the provisions of this Act shall apply to such tenancy; (c) to any  premises whether residential or not, whose monthly rent exceeds three thousand and five hundred rupees; (d) to any premises constructed on or after the commencement of the Delhi Rent Control (Amendment) Act, 1988, for a period of ten years from the date of completion of such construction. It is pertinent to note here that the above noted proviso to clause (b) was inserted in the year 1963, with retrospective effect. Similarly, clauses (c) and (d) were incorporated in the year 1988, with a view to encourage the landlord for the supply of accommodation on rent to meet the rising demands of houses in metropolitan cities. It is further worth while to mention at this juncture that in the Delhi Rent Control Act, 1995, enacted by the Parliament, which is yet to come into force, the aforesaid exemption of the premises from the applicability of the Act was further extended. In this regard, are reproduced as the statement of objects and reasons mentioned below:below: The relations between landlords and tenants in the National Capital Territory of Delhi are  presently governed by the Delhi Rent Control Act, 1958. This Act came into force on the 9th February, 1959. It was amended thereafter in 1960, 1963, 1976, 1984 and 1988. The amendments made in 1988 were based on the recommendations of the 'Economic Administration Reforms Commission and the National Commission on Urbanisation. Although they were quite extensive in nature, it was felt that they did not go far enough in the matter of removal of disincentives to the growth of rental housing and left many questions unanswered and problems unaddressed. Numerous representations for further amendments to the Act were received from groups of tenant and landlord and others. The demand for further amendments to the Delhi Rent Control Act, 1958 received fresh impetus with the tabling of the National Housing Policy in both Houses of Parliament in 1992. The policy has since been considered and adopted by Parliament. One of its major concerns is to remove legal impediments to the growth of housing in general and rental housing in particular Paragraph 4.6.2 of the National Housing Policy specifically provides for the stimulation of investment in rental housing especially for the lower and middle income groups by suitable amendments to rent control laws by State Government. The Supreme Court of India has also suggested changes in

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20

rent control laws. In its judgment in the case of Prabhakaran Nair v. State of Tamil Nadu,  the court observed that the laws of landlords and tenants must be made rational, humane, certain and capable of being quickly implemented. In this context, a Model Rent Control Legislation was formulated by the Central Government and sent to the States to enable them to carry out necessary amendments to the prevailing rent control laws. Moreover, the Constitution (Seventyfifth Amendment) Act, 1994 was passed to enable the State Governments to set up State level rent tribunals for speedy disposal of rent cases by excluding the jurisdiction of all courts except the Supreme Court. In the light of the representations and developments referred to above, it has been decided to amend the rent control law prevailing in Delhi. As the amendments are extensive and substantial in nature, instead of making changes in the Delhi Rent Control Act, 1958, it is proposed to repeal and replace the said Act by enacting a fresh legislation. To achieve the above purposes, the present Bill, inter-alia, seeks to provide for the following, namely:(a)exemption of certain categories of premises and tenancies from the purview of the proposed legislation; (b)creation of tenancy compulsorily to be by b y written agreement; (c)compulsory registration of all written agreements of tenancies except certain circumstances; (d)limit the inheritability of tenancies; (e)redefine the concept of rent payable and provide for its determination, enhancement and revision; (f)ensure adequate maintenance and repairs of tenanted premises and facilitate further improvement and additions and alterations of such premises; (g)balance the interests of landlords and tenants in the matter of eviction in specified circumstances;

20

 AIR 1987 SC 2117: (1987) 4 SCC 238

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(h)provide for limited period of tenancy and automatic eviction of tenants upon expiry of such tenancy; (i)provide for the fixing and revision of fair rate and recovery of possession in respect of hotels and lodging houses; (j)provide for a simpler and speedier system of disposal of rent cases through Rent Authorities and Rent Tribunal and by barring the jurisdiction of all courts except the Supreme Court; and (k)enhance the penalties for infringement of the provisions of the legislation by landlords and tenants. 5. On enactment, the Bill will minimize distortion in the rental housing market and encourage the supply of rental housing both from the existing ex isting housing stock and from new housing hou sing stock." Thus, we find that certain more categories of premises and tenancies are sought to be exempted  by the proposed legislation. However, due to lot of protest from a particular section of the society the said legislation has failed to see the light of the day.

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GROUNDS OF EVICTION The Rent Control Legislation puts a complete bar on the eviction of the tenants. In this regard, specific reference is made to section 14 of the Delhi Rent Control Act, 1958, which is in part material with other similar kind of provisions as contained in other State Rent Control Legislations. Section 14 of the Delhi Rent Control Act, 1958 (in short 'Rent Control Act') starts with a non-obstantic clause and states that notwithstanding anything to the contrary contain in any other law or contract, no order or decree for the recovery of possession of any premises shall  be made by any an y Court or controller in favour of the landlord against a tenant. However, this bar of eviction of a tenant at the instance of the landlord is lifted by proviso to section 14(1), according to which, on an application made to the Controller in the prescribed manner, an order for recovery of possession of the premises could be made on one or more of the grounds mentioned therein. Therefore, a tenant can be evicted from the premises only on those grounds as mentioned in the proviso to section 14(1) of the Rent Control. Though it is pertinent to mention here that by way of amendment in the year 1976, some more grounds of eviction were made available to the landlord in the form of sections 14A, 14B, 14C and 14D. If none of these grounds exist tenant cannot be evicted from the premises and no application in this regard would lie before the Rent Controller. Further, the burden to prove these grounds is on the landlord. Some of the 'grounds of eviction' are discussed hereunder. ENT/ARREARS OF R ENT ENT 1. NON-PAYMENT OF R ENT

Clause (a) of the proviso to sub-section (1) of section 14 of the Rent Control Act, deals with this ground of eviction. According to this ground, if the tenant has neither paid nor tendered the whole of the arrears of the rent legally recoverable from him within two months of the date on which a notice of demand for the arrears of the rent has been served on him by the landlord in the manner provided in section 106 of the Transfer of Property Act, 1882 cause of action would arise in favour of landlord to approach the Controller for eviction of the tenant. But sub-section 2 of section 14 of the Delhi Rent Control Act, 1958 provides that no order for recovery of possession shall be made on this ground if the tenant makes payment or deposit as required by section 15 of the Rent Control Act. Section 15 provides that in such a case, even if the landlord has been able to prove the allegation of non payment of arrears of rent, the Rent Controller shall, after giving

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the parties an opportunity of being heard, make an order directing the tenant to pay to the landlord or deposit with the Controller within one month of the date of the order, an amount calculated at the rate of rent at which it was last paid for the period for which the arrears of the rent were legally recoverable from the tenant including the period subsequent thereto up to the end of the month previous to that in which payment or deposit is made and to continue to pay or deposit, month by month, by the fifteenth of each succeeding month, a sum equivalent to the rent at that rate.

21

It is worthwhile to mention here that an application seeking an order on the tenant to pay to the landlord the amount of rent legally recoverable from the tenant can also be made even in any other proceedings for the recovery of the possession of any premises on any other ground under the Rent Control Act and in such a situation, Controller may, after giving the parties an 22

opportunity of being heard, make an order in accordance with the provisions of o f sub-section (1).

However, if in any proceedings qua non payment of rent by the tenant to the landlord, there is any dispute as to the amount of rent payable by the tenant, the controller shall within 15 days of the date of first hearing of such proceedings fix an interim rent in relation to the premises to be  paid or deposited in accordance with the provisions of o f the sub-section (1) or sub-section (2) of of section 15, as the case may be, until the standard rent in relation thereto is fixed having regard to the provisions of the Rent Control Act and the amount of arrears, if any, calculated on the basis of standard rent shall be paid or deposited by the tenant within one month of the date on which 23

the standard rent is fixed or such further time as the Controller may allow in this behalf.

It is further provided that if there is any dispute as to the person or persons to whom rent is  payable, the controller may direct the tenant to deposit with the Controller, the amount payable  by him under und er sub-section (1), sub-section (2) or sub-section (3) as the case may be and in such a case, no person shall be entitled to withdraw the amount in deposit until the Controller decides the dispute and makes an order for payment of the same. However, if the Controller is satisfied that such a dispute as to the identity of the landlord has been raised by the tenant for reasons,

21

 Section 15(1) of the Delhi Rent Control Act, 1958.  Section 15(2) of the Delhi Rent Control Act, 1958. 23  Section 15(3) of the Delhi Rent Control Act, 1958. 22

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which are false or frivolous, Controller may order the defence against eviction to be struck out 24

and proceed with the hearing of the application.

Supreme Court observed that non-payment of rent is not a ground for eviction of the tenant straightaway, since he has been granted an opportunity statutorily to make such payment within two months from the date of receipt of the notice sent by the landlord to the tenant in this regard. Second opportunity is granted by the Rent Controller under the Rent Control Legislation when 25

he is directed to make payment within one month from the date of such an order.  If the tenant complies with such a direction/order of the Controller, no order shall be made for recovery of  possession against the tenant in favour of the landlord on the ground of default in the payment of rent by the tenant, though the Controller may allow such costs as he may deem fit to the 26

landlord.

However, if the tenant fails to make payment or deposit as required by section 15(1) of the Rent Control Act, Controller may order the defence against eviction to be struck out and proceed with 27

the hearing of the application. But the question arises whether the Rent Controller, in view of section 15(7) of the Rent Control Con trol Act, has power or jurisdiction to condone the delay or to extend the time for depositing the rent and whether the order passed under section 15(1) had to be strictly complied with. The Supreme Court has laid down that the word 'may' used in section 15(7) clearly shows that it is not obligatory on the Controller to strike down the defence if the tenant fails to comply with the order, as passed under section 15(1) of the Rent Control Act. Hence, the Controller has discretionary power, keeping in view the facts and circumstances of the case, to condone the delay and secondly to extend the time for depositing the rent. It is also  pertinent to mention here that tenant cannot avail such a benefit if having obtained benefit ben efit once in respect of any premises; he again makes a default in the payment of rent of those premises for 28

three consecutive months .

24

 Section 15(4) of the Delhi Rent Control Act, 1958.  Section 15(1) of the Delhi Rent Control Act, 1958. 26  Section 15(6) of the Delhi Rent Control Act, 1958 27  Section 15(7) of the Delhi Rent Control Act, 1958. 28  14(2) No order for the recovery of possession of any premises shall be made on the ground specified in clause (a) of the proviso to sub-section (1) if the tenant makes payment or deposit as required by section 15: Provided that no tenant shall be entitled to the benefit under this sub-section, if, having obtained such benefit once in respect of any  premises, he again makes a default in the payment of rent of those premises for three consecutive months. 25

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2. SUB-LETTING THE R ENTED ENTED OUT PREMISES Clause (b) of the proviso to sub-section 1 of section 14 of the Rent Control Act, deals with this ground of eviction. It is provided that if the landlord is able to prove before the Rent Controller that the tenant has sublet the premises further, he is entitled to get back the possession of the  premises. However section 16 puts restrictions on sub-letting and provides that where at any time  before the 9th day of June 1952, 1 952, a tenant has sublet the whole or any part of the premises and the sub tenant is, at the commencement of this Act, in occupation of such premises, then notwithstanding that the consent of the landlord was not obtained for such sub-letting, the 29

 premises shall be deemed to have been lawfully sub-let.

The section further provides that no premises which have been sub-let either in whole or in part on or after the 9th day of June, 1952, without obtaining the consent in writing of the landlord, 30

shall be deemed to have been lawfully sub-let.  However, after the commencement of the Rent Control Act, it is provided that, no tenant shall, without the previous consent in writing of the landlord (a) sub-let the whole or any part of the premises held by him as a tenant; or (b) transfer or assign his rights in the tenancy or in any part thereof.

31

The section further puts a bar on the landlord to claim or receive the payment of any sum as  premium or pugree or claim or receive any consideration whatsoever in cash or in kind for giving 32

his consent to the sub-letting of the whole or any part of the premises held by b y the tenant.

If the provisions of section 16 have been complied with, in such a situation, the premises is deemed to have been sub-let properly. Otherwise, the landlord is entitled to get the tenant evicted in terms of clause (b) of proviso to section 14(1), which provides that the Controller may make an order for recovery of possession of the premises on the ground that the tenant has, on or after the 9th day of June, 1952, sub-let, assigned or otherwise parted with the possession of the 33

 premises without obtaining the consent in writing of the landlord.

29

 Section 16(1) of the Delhi Rent Control Act, 1958.  Section 16(2) of the Delhi Rent Control Act, 1958. 31  Section 16(3) of the Delhi Rent Control Act, 1958. 32  Section 16(4) of the Delhi Rent Control Act, 1958. 33  Section 14(1)(b) of the Delhi Rent Control Act, 1958. 30

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Even after seeking permission of the landlord for creating sub-tenancy, the tenant is under obligation to give notice of creation and termination of sub-tenancy in terms of section 17. Accordingly, whenever, after the commencement of the Rent Control Act, any premises are sublet either in whole or in part by the tenant with the previous consent in writing of the landlord, the tenant or the sub-tenant to whom the premises are sub-let may, in the prescribed manner, give notice to the landlord of the creation of the sub-tenancy within one month of the date of such sub-letting and notify the termination of such sub-tenancy within one month of such 34

termination.

On the other hand, where before the commencement of this Act, any premises have been lawfully sub-let either in whole or in part by the tenant, the tenant or the sub-tenant to whom the  premises have been sub-let may, in the prescribed manner, give notice to the landlord of the creation of the sub-tenancy within six months of the commencement of this Act, and notify the termination of such sub-tenancy within one month of such termination.

35

  At this juncture it

would be pertinent to mention here that definition of the tenant as provided in section 2(l) of the Rent Control Act, also includes a sub-tenant, but it is for a purpose, for the conferment of rights and obligations on such sub tenant wherever statute requires under various provisions of an Act, of that which is conferred on a tenant. But this would have no application where Statute itself treats both as 2 separate entities as is incorporated both in section 14(1)(b) and sections 16, 17 and 18 of the Act. When a tenant inducts a sub-tenant without written consent of a landlord, he makes himself liable for eviction under section 14(1)(b) of the Act. It would be fruitful to mention section 18 at this juncture which provides that where an order for eviction in respect of any premises is made under section 14 against a tenant but not against a sub-tenant referred to in section 17 and a notice of the sub-tenancy has been given to the landlord, the sub-tenant shall, with effect from the date of the order, be deemed to become a tenant holding directly under the landlord in respect of the premises in his occupation on the same terms and conditions on which the tenant would have held from the landlord, if the tenancy 36

had continued.

34

 Section 17(1) of the Delhi Rent Control Act, 1958.  Section 17(2) of the Delhi Rent Control Act, 1958. 36  Section 18(1) of the Delhi Rent Control Act, 1958. 35

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However, where before the commencement of Act, the interest of the tenant in respect of any  premises has been determined without determining the interest of any sub-tenant to whom the  premises either in whole or in part had been lawfully sub-let, the sub-tenant shall, with effect from the date of the commencement of this Act, be deemed to have become a tenant holding directly under the landlord on the same terms and conditions on which the tenant would have 37

held from the landlord, if the tenancy had continued.

Thus, it is borne from a conjoin reading of sections 16, 17 and 18 that both tenant and sub-tenant 38

have been treated as separate entity . Sub-section 3 of section 14 of the Rent Control Act, provides that no order for the recovery of  possession in any proceeding under sub-section (1) shall be binding on any sub-tenant referred to in section 17 who has given notice of his sub-tenancy to the landlord under the provisions of that section, unless the sub-tenant is made a party p arty to the proceeding and the order for eviction is made 39

 binding on him.

Sub-section 4 of the section 14 further clarifies that in any application for eviction of tenant on the ground of sub-tenancy as provided in section 14(1)(b), any premises, which have been let for  being used for the purpose of o f business or profession shall be deemed to have been sub-let by the tenant, if the Controller is satisfied that the tenant without obtaining the consent in writing of the landlord has, after the 16th day of August, 1958, allowed any person to occupy the premises ostensibly on the ground that such person is a partner of the tenant in the business or profession 40

 but really for the purpose of sub-letting such premises to the person.

3. NON-USER OF THE R ENTED ENTED PREMISES FOR MORE THAN SIX MONTHS Clause (d) of the proviso to sub-section (1) of the section 14 of the Delhi Rent Control Act, 1958 deals with this ground of eviction. It provides that if the premises were let for use as a residence and neither the tenant nor any member of his family has been residing therein for a period of six months immediately before the date of filing of the application for the recovery of possession thereof, the landlord is entitled to get back the possession of the premises. 37

 Section 18(2) of the Delhi Rent Control Act, 1958.  Kapil Bhargava v. Subhash Chand Aggarwal, 93 (2001) DLT 65 (SC) 39  Section 14(3) of the Delhi Rent Control Act, 1958. 40  Section 14(4) of the Delhi Rent Control Act, 1958. 38

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It has been observed by the Apex Court that a close analysis of section 14(1)(d) would reveal that before the landlord can succeed, he must prove three essential ingredients: (1)that the premises were let out for use as a residence, (2)that the tenant after having taken the premises has ceased to reside, and (3)that apart from the tenant no member of his family also has been residing for a period of six 41

months immediately before the date of the filing of the application for ejectment .

4. IMPERMISSIBLE USER OF THE R ENTED ENTED PREMISES Clause (c) of the proviso to sub-section 1 of the section 14 of the Rent Control Act deals with this ground of eviction. It provides that if the landlord is able to prove before the Rent Controller that the tenant has used the premises for purpose other than that for which they were let-(i) If the  premises have been let on or after the 9th day of June, 1952, without obtaining the consent in writing of the landlord; or (ii) If the premises have been let before the said date without obtaining 42

his consent; he is entitled to get back the possession of the premises.

This ground of eviction has to be studied alongwith ground of eviction as provided under clause (k) of the proviso to section 14(1). Because in both the grounds, tenant is alleged to be using the  premises for a different purpose. This aspect of the matter we would be discussing subsequently when we would be dealing with section 14(1)(k). According to the ground of eviction as  provided in section 14(1)(c) the Rent Controller may make an order for recovery of possession of the premises after the tenant has used the premises for purpose other than that for which they were let. However, sub-section 5 of the section 14 provides that no application for the recovery of  possession of any premises shall lie under sub-section (1) on the ground specified in clause (c) of the proviso thereto, unless the landlord has given to the tenant a notice in the prescribed manner requiring him to stop the misuse of the premises and the tenant has refused or failed to comply with such requirement within one month of the date of service of the notice; and no order for eviction against the tenant shall be made in such a case, unless the Controller is satisfied that the 41

 Baldev Sahai Bagla v. R.C. Bhasin, MANU/SC/0216/1982: AIR 1982 SC 1091. 42  Section 14(1)(c) of the Delhi Rent Control Act, 1958.

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misuse of the premises is of such a nature that it is a public nuisance or that it causes damage to the premises or is otherwise detrimental to the interest of the landlord.

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3. TENANT ACQUIRING VACANT POSSESSION OF OR HAS BEEN ALLOTTED A R ESIDENCE ESIDENCE We have already seen that on account of rapid growth of population in urban areas, the landlords were tempted to terminate tenancies of the existing tenants and ask for their eviction in order to let out the premises to new tenants at higher rents. The Rent Control Legislations were passed in different States during the second world war so as to provide for the control of rent and eviction. The object of the ground of eviction as provided in clause (h) of the proviso to sub-section (1) of section 14 is not to allow the tenant more than one residence in Delhi. Therefore it provided that in case tenants built the residence, the landlord could get the house vacated. It also provided that if the tenant acquired vacant possession of any other residence, he is not protected. Lastly, it also stipulated that if any premises has been allotted to the tenant he is not entitled to retain the  premises taken on rent by him. However, in the year 1988 by way of Rent Control (Amendment) Act, 1988, the word "built" was omitted and consequently now the said provision reads as under: "That the tenant has, whether before or after the commencement of this Act, acquired vacant  possession of, or been allotted, a residence."

5. USE OF PREMISES IN VIOLATION OF CONDITIONS OF LEASE STIPULATED BY DDA/MCD Section 14(1) of the Act gives protection to the tenants from being evicted from the premises let out to them. Clauses (a) to (l) of the proviso to section 14(1) of the Act contain the grounds on which recovery of possession of the premises can be ordered by the Controller. Where the  premises are used in a manner contrary to any condition imposed on the landlord by the Government or the Delhi Development Authority or Municipal Corporation of Delhi, then the landlord would be entitled to recovery of possession under section 14(1)(k) of the Act. Subsection (11) of section 14, however gives an option to the Controller to pass an order whereby recovery of possession may not be directed. The alternative to an order for recovery of 43

 Section 14(5) of the Delhi Rent Control Act, 1958

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 possession under section 14(1)(k) is to pass an order under sub-section (11) of section 14 of the Act, whereby the tenant is directed to comply with the conditions imposed on the landlord by the authorities referred to in clause (k) namely to stop the misuser of the premises in question. Subsection (11) of section 14 also uses the words "pays to that authority such amount by way of compensation as the Controller may direct". Keeping in view the fact that clause (k) of the  proviso to sub-section (1) has been inserted in order that the unauthorised use of the leased  premises should come to an end, and also bearing in mind that the continued unauthorised use would give the principal lessor the right of re-entry after cancellation of the deed. The aforesaid words occurring in sub-section (11) of section 14 cannot be regarded as giving an option to the Controller to direct payment of compensation and to permit the tenant to continue to use the  premises in an unauthorised manner. The principal lessor may, in a given case, be satisfied, in cases of breach of lease to get compensation only and may waive its right of re-entry or cancellation of lease. In such a case the Controller may, instead of ordering eviction under section 14(1)(k) of the Act, direct payment of compensation as demanded by the authorities mentioned in clause (k). Where, however, compensation is demanded in respect of condoning/removal of the earlier breach, but the authority insists that the misuser must cease then the Controller has no authority to pass an order under section 14(11) or section 14(1)(k) of the Act giving license or liberty of continued misuser. In other words, sub-section (11) of section 14 enables the Controller to give another opportunity to the tenant to avoid an order of eviction. Where the authority concerned requires stoppage or misuser then an order to that effect has to be  passed, but where the authority merely demands compensation for misuser and does d oes not require the stoppage of misuser then only in such a case would the Controller be justified in passing an 44

order for payment of compensation alone.

Di f f er ence betwee between n section section 14(1)(c) and section section 14(1)(k)

It would be pertinent to discuss at this juncture the ground of eviction provided to the landlord under clause (c) of the proviso to section 14 of the Rent Control Act. (impermissible use of rent  premises). In both these grounds of eviction, as provided under sections 14(1)(c) and 14(1)(k), there is an impermissible use of rented premises. But the difference lies in the fact that in clause (k) the permissible use is contrary to any condition imposed on the landlord by the Government 44

 Dr. K. Madan v. Krishnawati, MANU/SC/0150/1997: AIR 1997 SC 579.

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or any other authority, while giving him a lease of the land on which the demised premise is situated. However, here the impermissible use may be even with the consent of the landlord. On the other hand under clause (c) the impermissible use of the premises by the tenant is without the consent of the landlord. Hence, in clause (k), the tenant cannot take the plea that he is using the premises for the alleged purpose with the consent of the landlord, since that would not be defence available to him in an application for his eviction moved under the said clause, though such a plea would negate the landlord a decree of eviction under section 14(1)(c). It has been laid down that even if the tenant is using the demised premises with the consent of the landlord for the purpose contrary to the condition imposed on him by the original lessor (the Government or any another local authority), the landlord cannot be estopped from getting the tenant evicted for 45

that impermissible use of the suit premises.

Such kind of stand can be taken only in an eviction petition filed under section 14(1) (c) of the Rent Control Act. Hence, if it is a case where the tenant as contrary to the terms of his tenancy used the building for commercial purpose, the landlord could take action under clause (c). He need not depend upon clause (k) at all. These two clauses are intended to meet different situation. There was no need for, an additional provision in clause (k) to enable the landlord to get  possession, where the tenant has used the building for a commercial purpose contrary to the terms of the tenancy. An intention to put in a useless provision in a statute cannot be imputed to the legislature somes meaning would have to be given to that provision. The only situation in which it can take effect is whether the lease is for a commercial purpose agreed upon by both the landlord and the tenant but that is contrary to the terms of the lease of the land in favour of the landlord. This clause does not come into operation, where there is no provision in the lease in 46

favour of the landlord prohibiting its use for a commercial purpose. Recovery of Possession in case of Limited Period of Tenancy 47

The section 21 embodies the legislative policy to devise a special mechanism to increase the supply of accommodation to meet the rising demands of a growing metropolis. It operates in

45

 Dr. K. Madan v. Krishnawati, MANU/SC/0150/1997: AIR 1997 SC 579.  Faquir Chand v. Ram Ratan, MANU/SC/0412/1973: AIR 1973 SC 921. 47  Recovery of possession in case of tenancies for limited period.(1) Where a landlord does not require the whole or any part of any premises for a particular period, and the landlord, after obtaining the permission of the Controller in 46

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limited circumstances; and, strictly within those bounds, and subject to the vigilant enquiry of the Controller before according his permission, the parties are, once permitted to regulate their relationship in accordance with the section, totally governed by the terms of their contract. The section operates in terms thereof, notwithstanding any other law, unless the contract itself, or the  permission of the Controller is vitiated by fraud. Absent such vitiating circumstance, and once the Controller has accorded sanction, the parties to the contract are presumed to have entered into their relationship at arm's length and the law binds them to the terms of their agreement.

48

While the Act, is meant for the protection of the tenant, the legislative policy reflected in section 21 is to carve out an area free of that protection. Where the conditions stipulated in section 21 are satisfied, the prohibition contained in section 14 against eviction of tenants except on the specified grounds or the requirements of the Transfer of Property Act, or the Civil Procedure Code or any other law are removed or dispensed with. The section is attracted in the specific circumstances postulated by it. The absence of requirement by the landlord of the whole or any  part of the premises for a particular period, the permission of the Controller in the prescribed manner for the lease of the premises in question, the agreement in writing between the landlord and the tenant for the lease of such premises as a residence for the agreed period, the refusal of the tenant to vacate the premises on the expiry of that period, and an application made within the  prescribed time by the landlord invoking the th e power of the Controller under this section: these are the conditions precedent to the exercise of power by the Controller to place the landlord in vacant possession of the premises by evicting the tenant or any other person in occupation of such premises. The person in occupation of the premises has no right in law to resist eviction once the section is attracted. This is an extraordinary power vested in the Controller to restore  possession of the premises to the landlord by a quick and summary action. The non obstante clause contained in the section protects the action of the Controller from challenge on any ground postulated in section 14 of the Act, or any other law. This is a wide protection of any

the prescribed manner, lets the whole of the premises or part thereof as a residence for such period as may be agreed to in writing between the landlord and the tenant and the tenant does not on the expiry of the said period, vacate such  premises then, notwithstanding anything contained in section 14 or in any other law, the Controller may, on an application made to him in this behalf by the landlord within such time as may be prescribed, place the landlord in vacant possession of the premises or part thereof by evicting the tenant and every other person who may be in occupation of such premises. 48  Shrisht Dhawan v. Shaw Brothers, MANU/SC/0295/1992: AIR 1992 SC 1555.

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action duly taken in terms of the section, but the requirements of the section must be strictly 49

complied with before action is taken under u nder it.

The order of the Controller in the circumstances warranted by the section is a self-executing order requiring no further proceeding. It is at once a sanction for the lease and for eviction on expiry of the period of the lease. Neither can the landlord evict the tenant during the period of the lease nor can the tenant remain in possession beyond that period. Parties are bound by their contract, as sanctioned by the Controller, and the provisions of section 14 are of no avail to either  party to circumvent section 21. 2 1. Once the period has expired, there is no question of any further notice to the tenant or any other person in occupation of the premises and there is no scope for any further proceeding. None has any right outside the section which operates strictly in terms 50

thereof provided the conditions stipulated therein are unquestionabl y satisfied.

The only protection that the tenant has is what section 21 itself postulates. He is protected against the conduct of a fraudulent landlord. The law does not protect either party whose actions are tainted by fraud. A landlord seeking recovery in terms of that section must satisfy that he has strictly complied with the provisions of that section. The landlord must obtain the permission of the Controller in the manner prescribed. He is not entitled to the permission unless the condition specified for the purpose in section 21 is satisfied, namely, the absence of his requirement of the  building for a particular period. The period must be clear and definite. The Th e lack of requirement must be honestly felt by the landlord. That the landlord does not require the building is a question of honest belief held by him at the relevant time, that is, at the time of his seeking the Controller's permission. The landlord must have honestly and reasonably believed that he would not require the building for the period specified in his application to the Controller for  permission to let out the premises. If that belief was truthfully held by him at the time of his application to the Controller, the fact that subsequent events proved him wrong, and that he did not require the building not only for the period stated in the application, but also for a longer  period, or that he required it earlier than anticipated, would not make the belief any less honest or valid. All that the landlord is required to state in his application for permission of the Controller     9     5 49

 Shrisht Dhawan v. Shaw Brothers, MANU/SC/0295/1992: AIR 1992 SC 1555. 50  ; J.R. Vohra v. India Export House Pvt. Ltd., MANU/SC/0384/1985: (1985) 1 SCC 712.

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is the absence of his requirement of the premises for the particular period, but he is not bound to 51

state its reasons . What the section postulates is the bona fide belief of an honest and reasonable landlord, and not the reckless and casual opinion of an irresponsible and careless person. The question is, did the landlord make a fraudulent representation to the Controller about the absence of his requirement of the premises, i.e., knowingly that his statement was false or without belief in its truth or recklessly careless whether it was true or false. Did the landlord honestly believe that what he stated in his application to be a true and fair representation of the facts? There is no fraud if what he honestly believed to be true turned out to be false. The section does not place any higher degree of responsibility on the landlord. The section requires that the premises have to be let out solely for the purpose of residence for the period agreed to in writing. If the agreement does not so stipulate, the section is not attracted, and the Controller cannot sanction the lease in terms of the section. No non-residential premises can come within the protection of the section. On the other hand, if the premises let out as a residence in terms of the section is deliberately used by the tenant for nonresidential purposes, he loses the protection of the statute for the period of the lease and the Controller can, on an application by the landlord, evict the tenant, or any other  person in occupation, and restore possession of the premises to the landlord forthwith. The section protects the landlord and the tenant strictly in terms thereof, and on the fraud or deliberate breach by either party of the terms of the lease as contemplated by the section, the  protection is withdrawn from the guilty party. This means, if the permission of the Controller has  been fraudulently obtained by the landlord, and the tenant has been let into the premises, the landlord loses the right to seek eviction of the tenant by the summary procedure contemplated by the section. Likewise, if the tenant has deliberately but not accidentally violated the terms of the lease by using the premises otherwise than as permitted by the section, he is liable to be evicted on an application by the landlord, although the stipulated period of the lease has not expired. All this is because the very basis of the Controller's order has been violated by the fundamental  breach of the guilty party. The section thus postulates that both the landlord and the tenant act

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 Inder Mohan Lal v. Ramesh Khanna, MANU/SC/0762/1987: (1987) 4 SCC 1

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honestly. Neither of them can take advantage of his own deceit or breach. No sanction of the 52

statutory authority procured by fraud can protect t he guilty or harm the innocent. inno cent.

Fraud is essentially a question of fact, the burden to prove which is upon him who alleges it. He, who alleges fraud, must do so promptly. There is a presumption of legality in favour of a statutory order. The Controller's order under section 21 is presumed to be valid until proved to be vitiated by fraud or mala fide. If his order was obtained by the fraud of the party seeking it or if he made a 'mindless order' in the sense of acting mala fide by illegitimate exercise of power owing to non-application of his mind to the strict requirements of the section, then the special 53

mechanism of the section would not operate.

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 Shrisht Dhawan v. Shaw Brothers, MANU/SC/0295/1992: AIR 1992 SC 1555. 53  S.B. Noronah v. Prem Kumari Khanna, MANU/SC/0502/1979: (1980) 1 SCC 52.

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SUMMARY PROCEDURE Chapter IIIA, which was inserted in the Rent Control Act, by Amendment Act of 1976, is entitled 'Summary Trial of Certain Applications'. It consists of three sections, namely, sections 25A, 25B and 25C. Section 25A provides that the provisions of Chapter IIIA or any rule made thereunder shall have effect notwithstanding anything inconsistent therewith contained elsewhere in the Act or in any other law for the time being in force. Section 25B prescribes as its marginal heading shows a 'special procedure for the disposal of applications for eviction on the ground of  bona fide requirement'. Under section 25B every application by a landlord for the recovery of possession of any  premises, on the ground specified in clause (e) of the proviso to section 14(1), 14 (1), or under section 54

55

56

14A, or under section 14B , or under section 14C   or under 14D , is to be dealt with in accordance with the special procedure prescribed p rescribed by this section. The special procedure which has been prescribed for these cases is that on an application being filed on either of these two grounds the Controller is to issue a summons in the form specified in the Third Schedule to the Act. This summons is to call upon the tenant to appear before the Controller within fifteen days of the service of the summons and to obtain leave of the Controller to contest the application for eviction, and it intimates to him that in default of his doing so, the applicant would be entitled after the expiry of the said period of fifteen days to obtain an order for his eviction. Leave to appear and to contest the application is to be obtained by the tenant on an application made to the Controller supported by an affidavit. This affidavit is to disclose such facts as would disentitle the landlord from obtaining an order for the recovery of possession of the premises on the ground specified in clause (e) of the proviso to section 14(1) or under section 14A. When leave is granted to the tenant to contest the application, the Controller is to commence the hearing of the application as early as practicable. In holding such an enquiry, the Controller is to follow the practice and procedure of a Court of Small Causes including the recording of

54

Right to recover immediate possession of premises to accrue accrue to members of the Armed Forces. Right to recover immediate possession of premises to accrue to Central Government and Delhi Administration employees. 56  Right to recover immediate possession of premises to accrue to widow. 55

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evidence. No appeal or second appeal lies against an order for the recovery of possession of any  premises made by the Controller in accordance with this special procedure. The High Court is, however, given the right to call for the records of the case for the purpose of satisfying itself that an order made by the Controller under this section is according to law and to pass such order in respect of thereto as it thinks fit.

57

It is now well-settled that though the Statement of objects and Reasons accompanying a legislative Bill cannot be used to determine the true meaning and effect of the substantive  provisions of a statute, it is permissible to refer to the Statement of Objects and Reasons accompanying a Bill for the purpose of understanding the background, the antecedent state of affairs, the surrounding circumstances in relation to the statute, and the evil which the statute sought to remedy. It will, therefore, be convenient to reproduce at this stage the statement of Objects and Reasons accompanying Bill No. XII of 1976, which when enacted became the Delhi Rent Control (Amendment) Act, 1976. The said Statement of Objects and Reasons is as follows:There has been a persistent demand for amendments to the Delhi Rent Control Act, 1958 with a view to conferring a right of tenancy on certain heirs/successors of a deceased statutory tenant so that they may be protected from eviction by landlords and also for simplifying the procedure for eviction of tenants in case the landlord requires the premises bona fide for his personal occupation. Further, Government decided on the 9th September, 1975 that a person who owns his own house in his place of work should vacate the Government accommodation allotted to him before the 31st December, 1975. Government considered that in the circumstances, the Act, required to be amended urgently. By the special procedure provided in section 25B the delay normally involved in following the  procedure under unde r section 37 of the Act, is sought to be cut down and the tenant is made to apply and obtain leave to contest the eviction application. Further, the tenant's right of appeal and second appeal have been taken away and the only remedy left to him against an order of eviction  passed by the Controller under section 25B is to approach the High Court in revision. It is pertinent to mention here that the legislature has given the provisions of this Chapter or any rule made thereunder overriding effect on the other provisions of the Rent Control Act, or any 57

 Narain Khamman v. Parduman Kr. Jain, MANU/SC/0319/1984: AIR 1985 SC 4.

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other law for the time being in force. One may find some parallel between the procedure  provided in this Chapter and the summary procedure procedu re as provided p rovided under Order 37 of the Code of Civil Procedure. However, the concept about the summary procedure as inserted in the Act, by 58

way of aforesaid Chapter IIIA.

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Gazette of India, Extra., Pt. II, Sec. 2, dated January January 19, 1976, p. 410.

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REMEDY AGAINST CUTTING OFF OR WITHHOLDING ESSENTIAL SUPPLY OR SERVICE The tenant cannot enjoy the premises let out to him by the landlord unless and until it is coupled with other essential supplies/services without which the living in that premise is not possible. These include water, electricity, lights in passages and on staircases, conservancy and sanitary 59

services.  Section 45 of the RCA makes it obligatory on the part of the landlord to provide those essential supplies or services and not to cut off or withhold the same. Therefore, section 45of the Rent Control Act, makes these provisions. It provides that no landlord either himself or through any person purporting to act on his behalf shall without just and sufficient cause cut off or withhold any essential supply or service enjoyed by the tenant in respect of the premises let to 60

him.   If a landlord contravenes the provisions of sub-section (1), the tenant may make an 61

application to the Controller complaining of such contravention.  If the Controller is satisfied that essential supply or service was cut off or withheld by the landlord with a view to compel the tenant to vacate the premises or to pay an enhanced rent, the Controller may pass an order directing the landlord to restore the amenities immediately, pending the inquiry referred to in 62

sub-section (4). The section further provides that an interim order may be passed under this sub63

section without giving notice to the landlord. If the Controller on inquiry finds that the essential supply or service enjoyed by the tenant in respect of the premises was cut off or withheld by the landlord without just and sufficient cause, he shall make an order directing the landlord to restore 64

such supply or service. The Controller may in his discretion direct that compensation not exceeding fifty rupees(a)  be paid to the landlord by the tenant, if the application under sub-section (2) was made frivolously or vexatiously;

59

 Explanation I to section 45  Sub-section 1 61  Sub-section 2 62  Sub-section 3 63  Explanation to sub-section 3 64  Sub-section 4 60

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(b) be (b)  be paid to the tenant by b y the landlord, if the landlord had cut off or withheld the supply or 65

service without just and sufficient cause.

By way of explanation it has been mentioned in this section that essential supply or service includes supply of water, electricity, lights in passages and on staircases, conservancy and 66

sanitary services.   Similarly, it is also clarified in the section that for the purposes of this section, withholding any essential supply suppl y or service shall include acts or omissions attributable to the landlord on account of which the essential supply or service is cut off by the local authority 67

or any order competent authority.

65

 Sub-section 5.  Explanation I to sub-section 5 67  Explanation II to sub-section 5 66

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CONCLUSION The basic objective of the rent control legislation is to protect the tenant against exorbitant rents, arbitrary increases in the rent and ensure him security of tenure. The legislation has been necessitated by conditions of scarcity prevailing in rental housing markets of urban areas. As housing is a State subject, different State Governments have framed their own rent control laws. By 1972, almost all the States in the country had enacted Rent control Acts (RCA). The rent control Acts are generally applicable to all urban areas in the States and to most of the residential and non-residential premises in these urban areas. The exempted premises include those belonging to the Union Government, State Government and local authorities. Some states also exclude from the preview of the Act properties falling below or above certain rental values, newly constructed properties, as also properties belonging to charitable Trusts etc. In each city these exemptions account for a significant proportion of the total rental housing stock. The Acts typically contain in regard to the following provisions: a) control on letting and leasing of vacant buildings to assist tenants in their search for desirable rented accommodation, b) fixation of „fair‟ or „standard‟ rent, c) protection to tenants against indiscriminate eviction by unscrupulous landlords, d) obligations and duties of landlords vis-a-vis maintenance and upkeep of their rented properties, e) rights of landlords against tenants who default in paying rent or misuse the premises, and f) rights of landlords for the recovery of premises in specific cases. There is a near unanimous opinion that the social objectives of rent control acts have not been realized. The widening divergence between the interests of landlords and tenants has not only led to increased litigation under rent control Acts (the rent control cases make for a majority of cases in courts) but also to increased crimes. A large number of criminal cases have their origin in disputes over rented properties.

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BIBLIOGRAPHY Articles

1. Dev Satvik, Rent Control Laws in India A Critical Analysis, NIUA WP 06-04 2. Ojha, Shraddha, Protection against eviction and fixation of fair rent, available at : http://legalservicesindia.com/article/print.php?art_id=510 Books

1. Madabhushi Sridhar, Unfair rent Uncontrolable Control, (Hyderabad: Asia Law House) 2009 2. V.P. Sarthi, Law of Transfer of Property, (Lucknow: Eastern Book Co.) 2005

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