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SUPREME COURT CONTROLS THE RENT ACT

Divyakant Mehta & Associates

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RENT DECISIONS 2001

Landlords can recover premises to reconstruct if plans approved. Tenant gets accommodation in new premises
Bonafide requirement of landlord measured from date of application. if requirement is found to be not bonafide, tenant can file for restitution.
Justice delayed is justice denied. Bombay judge of small causes court has stated issuing judgment in 6-9 months.
In Kerala Act, if premises destroyed in natural disaster, tenancy rights stand squashed.
Churches, mosques exempted from Rent Act in Kerala.
Bengal landlords can evict tenants for sub-letting without consent.

As the year 2001 is coming to an end tomorrow, we must find out during the entire year what was the view of the Supreme Court relating to the various provisions of various States Rent Control Act. There is little change in the view and there are also some landmark important Judgments having wider effect on the rights of the landlord and the tenant.

The dispute and the differences amongst the landlord and tenant are known since 1939 onwards when for the first time, the Rent Control Legislation came into force restricting the rights of the landlord for recovery of rent or possession of the permises. There are various changes or new enactment has come into force or new interpretation has come into force during the year 2001 interpreting various provisions of the States' Rent Control Act and its amendment.

Demolition and Reconstruction. By virtue of the Rent Control Act, the entire activity of construction of new housing received a halt as the landlords were not getting adequate return in their investment in the property. Because of various Rent Restriction Acts, they were not able to get proper return on the property. As a result thereof, the supply of new housing were diminished. In order to give boost to such construction activity and to bring new housing, various States brought amendment to its Rent Control Legislation. The Stats have therefore provided the rights to the land lord to recover the premises from the existing tenants if the landlord intends to construct a new building, with a right to the tenant to get an alternate accommodation in the newly constructed building. Various States have such provisions in its Rent Control Ac. While interpreting the provisions of Section 21 (1) (1) of the Karnataka Rent Control Act 1961, the Supreme Court has held that on plain reading of the said provision, it is clear that the landlord has to plead in the eviction petition that the new building for construction, of which he is seeking the eviction of the tenant from the land, has been approved or permitted by a legal authority or other competent authority. This position is clear from the words" a new building which a local authority or other competent authority has approved or permitted him to built thereon". The provisions read in its entirety clearly shows that the procedure or permission of a local authority or other competent authority forms a part of the cause of action for filing the application for eviction of the tenant under the said Section. Reasonable and Bonafied Requirement.

On the point of resonable and bonafide requirement, dealing with the provisions under the Uttar Pradesh Urban (Regulations, regulating rent eviction) Act 1972, the Supreme Court held that crucial dates for deciding as to the bonafide of the requirement of the landlord is the date of his application for eviction. The antecedent dates may perhaps have utility for him to reach the said crucial date of consideration. If every subsequent development during the based position period is to be taken into account for judging the bonafied of the requirement pleaded by the landlord there would be perhaps be no end so long as the involved situation in our litigative slow process system subsist.

Justice Delayed is Justice Denied While considering the aforesaid matter, the Supreme Court held as also noticed the most popular phrase spoken by every speaker in every conference "justice delayed is justice denied". The Supreme Court while disposing of the matter arising our of Allahabad High Court's decision has stated" we wish to add as an epilogue, that this can provide a catalytic agent for the High Court to evolve some concrete schemes for cinching to the fore similar long pending matters, lying in torpidity at the bottom of crammed list of pending cases in the high courts after passing  the initial orders, keeping the operative part of decree in abeyance. The Supreme Court has also stated that it is not an advice but only a suggestion. Acknowledging the prevailing social situation, it will be necessary to note here the further observation of the Supreme Court. The Apex Court has said that the time is running out for doing something to solve the problem which has already grown into monstrous proportions. If a citizen is told that when you resort to legal procedure for realization of your urgent need, you have to wait for 23 to 30 years, what else is it ? Is it not to inevitably encourage and force him to resort to extra legal measures for realizing the required relief. A republic, governed by the rule of low cannot afford to compel its citizen to resort to such extra legal means, which are very often contra legal means with counter productive result on the maintenance of law and order in the country.

I do not know whether any other Court have taken seriously this observation of the Supreme Court. But to my knowledge, the Chief Judge of the Court of small Causes at Bombay has taken it seriously and improved the system and the procedure with the co-operation of the Bench and Bar and produced and proved the disposal of the suit of the landlord in a period of 6 to 9 months, which is required to be followed by the other Courts in India in order to give relief to the citizen of this country and to provide the justice quick.

While granting possession of the premises to the landlord on the ground of reasonable and bonafide requirement, the Supreme Court has also taken care of the right of the tenants. The Supreme Court has also held that where the landlord is getting tenant evicted on the ground of bonafide personal requirement, if in the near future it is found that this was a false ground  and that after getting the tenant evicted, the premises are not being used for the personal use of the landlord and his family as claimed, the tenant would be at liberty to adopt appropriate proceeding for restitution and get back the remises.

Destroyed the building by Natural Calamities.
In another landmark Judgment, the Supreme Court also held that when the tenanted shop has completely destroyed, the tenancy right stands squashed as the demise must have a subject matter and if the same is no longer in existence, there is an end of the tenancy and the provisions of the Section 108 of the Transfer of Property Act has no application in case of premises governed by the State Rent Act when it is completely destroyed by a natural calamities. However, these observation are under the Kerala Rent Control Act where the land is not within the definition of premises.

Exemption From Rent Act.
In another landmark Judgment under the Kerala Buildings (Lease and Rent Control) Act 1965, a notification was issued by the State Government under the said Act to grant exemption to Churches and Mosques from various provisions of Rent Control Act.

The High Court on the basis of ownership of the property held that a notification is invalid being issued without application of mind because some of the Churches and Mosques are used for commercial purposes and is against the rule of secularism. However, the Supreme Court set aside the Judgment of the Kerala High Court and held that a notification issued under the said Act granting exemption of minority institution from certain provision of the Rent Act are contitutionally valid and further held that High Court was wrong in declaring such provision as invalid.

Similarly a landmark Judgment is also delivered by the Division Bench of the Bombay High Court comprising of His Lordship Justice Mr. A. P. Shah and Justice Mr. Bobade upholding the validity of the provision of Section 3 (1) (b) of the Maharashtra Rent Control Act, 1999 granting exemption to the premises let or sublet to certain categories of tenant.

Sub-letting
Not the list, but the last the Supreme Court while dealing with the West Bengal Premises Tenancy Act 1956 held that if the sub-tenancy is created without requisite concerned in writing the landlord can file petition for eviction of tenant and is not required to implead sub-tenant unless the subtenant has given the notice of creation of tenancy as required under the said Act. Such substitute  sub tenant cannot resist against the execution on the ground that he was not made a party and his decree is obtained by collusion and fraud.