CASE NO.:
Appeal (civil) 5467 of 1998
PETITIONER:
VASHU DEO
Vs.
RESPONDENT:
BAL KISHAN
DATE OF JUDGMENT: 11/01/2002
BENCH:
R.C. Lahoti & Brijesh Kumar
JUDGMENT:
WITH
CIVIL APPEAL No.5468 OF 1998
JUDGMENT
R.C. Lahoti, J.
The suit property consists of a shop. It forms part of a building
owned by Sarvjanik Sampati Trust (hereinafter, the 'Trust', for short).
On 1.1.1973 the shop was taken on rent by Balkishan, the plaintiff -
respondent on a monthly rent of Rs.30/-. On 25.12.1975 Balkishan
sub-let the shop to Vasudev, the defendant-appellant, on a monthly
rent of Rs.150/-. The suit shop is governed by the provisions of the
Rajasthan Premises (Control of Rent and Eviction) Act, 1950
(hereinafter the 'Act', for short).
The appellant fell into arrears of rent for the period 1.1.1981 to
31.12.1982. The respondent served a notice on the appellant and then
filed a suit for recovery of arrears of rent as also for eviction on the
ground available under clause (a) of sub-section (1) of Section 13 of
the Act. On 30.3.1983, the Trust also filed a suit for eviction, against
its own tenant- the respondent, on the ground of unlawful sub-letting
of the premises by the latter. That suit is still pending. In any case,
the result thereof is not known. So far as the case before us is
concerned, the defendant-appellant raised a dispute putting in issue
the rate of rent at which the respondent could recover rent from the
appellant submitting that the agreed rent was in excess of the standard
rent and hence was not recoverable. Another plea taken by the
defendant-appellant was that subsequent to the institution of suit on
30.3.1983 by the Trust against the respondent, the appellant has on
1.4.1983 directly attorned in favour of the Trust and entered into a
direct tenancy agreement and therefore, w.e.f. 1.4.1983, the right of
the respondent to recover rent and secure eviction of the appellant had
come to an end. On 25.7.1985, the learned Civil Judge, Bhilwara
passed an order under Section 13(3) of the Act determining
provisionally the rate of rent at which the appellant was required to
deposit rent in the Court. This order dated 25.7.1985 was put in issue
by the appellant by filing an appeal in the court of Additional District
Judge, Bhilwara. Vide order dated 14.5.1992, the learned Additional
District Judge allowed the appeal, and set aside the order of the trial
court, forming an opinion that in view of the appellant having attorned
and entered into direct tenancy with the Trust, the respondent was not
entitled to claim rent and recover possession from the appellant, and
therefore, the suit filed by the respondent could not be treated as a suit
for eviction; it remained only a suit for recovery of arrears of rent for
the period upto 31st March, 1983. The respondent preferred a Civil
Revision Petition to the High Court which was resisted by the
appellant placing reliance on a Single bench decision of Rajasthan
High Court in Kewal Ram v. Mangu Mal, AIR 1974 Raj. 201. When
the Revision Petition came up for hearing before the learned Chief
Justice of the High Court, he doubted the correctness of the decision
in Kewal Ram's case and directed the petition to be placed for
hearing before a Division Bench. By order dated 22.8.1996, the
Division Bench has overruled the Single Bench decision in Kewal
Ram's case and held that the relations, rights and obligations of the
parties were governed by Section 13 of the Act and the sub-tenant
(appellant herein) inducted by the tenant (respondent herein) could not
directly attorn in favour of the Trust by excluding the principal tenant,
and therefore, was bound to comply with the order of the trial court
under Section 13(3) of the Act. The appellant sought for a review of
the order of the Division Bench which has been rejected by order
dated 23.3.1998. These appeals have been filed impugning the orders
dated 22.8.1996 and 23.3.1998 passed by Division Bench of the High
Court.
The issue arising for decision is : whether a sub-tenant
inducted by a tenant in the premises governed by the provisions of
rent control law can, during the continuance of sub-tenancy and
without vacating the premises, attorn in favour of the owner of the
premises and thereby refuse to discharge his obligations towards the
tenant who admittedly inducted him in the premises? Strong reliance
has been placed on behalf of the appellant on a decision of this Court
in D. Satyanarayana v. P. Jagdish, AIR 1987 SC 2192 to which we
will advert a little later.
Reference to a few relevant provisions of Rajasthan Premises
(Control of Rent and Eviction) Act, 1950, would be appropriate.
'Landlord' is defined by clause (iii) of Section 3 to mean 'any person
who for the time being is receiving or is entitled to receive the rent of
any premises as an agent, trustee, guardian or receiver for any other
person or who would so receive or be entitled to receive the rent, if
the premises were let to a tenant. The definition specifically provides
that 'Landlord' includes a tenant in relation to a sub-tenant. Clause
(iv) defines 'lease' as including a sub-lease. 'Tenant', according to
clause (vii), means inter alia the person by whom or on whose account
or behalf rent is, or, but for a contract express or implied would be,
payable for any premises to his landlord including the person who is
continuing in possession of the premises after the termination of his
tenancy otherwise than by a decree for eviction passed under the
provisions of this Act. Section 13 which opens with a non-obstante
clause, giving it an overriding effect over any other law or contract,
enjoins a court not to pass any decree or make any order in favour of
the landlord evicting the tenant unless a case for eviction was made
out within the four corners of Section 13. The effect of a combined
reading of these several provisions is to spell out two very relevant
and significant implications. Firstly, a tenant in relation to a sub-
tenant is a landlord and the sub-tenant is a tenant in relation to the
tenant who has inducted him on the premises. Secondly, inspite of the
tenancy having come to an end under the provisions of the Transfer
of Property Act, or by the terms of contract, the tenant does not cease
to be a tenant and continues to hold that status unless and until a
decree for eviction under the provisions of this Act has been passed
against him. Where the tenancy premises are governed by rent control
law, merely on termination of tenancy the tenant cannot be evicted;
the tenant is entitled to continue in possession enjoying status almost
on par with a person whose contractual tenancy still subsists. He
cannot be evicted unless a ground for eviction under the relevant
provision of rent control law is made out. He is not a tenant holding
over because his tenancy is not continuing by volition or by act of the
parties. Such continuance is attributable to the protection conferred
by statute and therefore, he is called a statutory tenant and his tenancy
a statutory tenancy (See Smt.Gian Devi Anand v. Jeevan Kumar &
Ors.: AIR 1985 SC 796 and Damadilal & Ors. v. Parashram & Ors.:
AIR 1976 SC 2229). The tenancy would determine only on a decree
for eviction being passed against him. In Smt. Chander Kali Bai &
Ors. v. Jagdish Singh Thakur and another : AIR 1977 SC 2262, this
Court has held that a person continuing in possession of the
accommodation after the termination of his contractual tenancy is yet
a tenant within the meaning of the relevant rent control legislation and
on such termination, his possession does not become wrongful until
and unless a decree for eviction is made against him. If he continues
to be in possession after the passing of the decree then he is in
wrongful occupation of the premises. In spite of the termination of
tenancy by contract or under the general law (other than rent control
law), the tenant continues to be a tenant liable to pay rent and is not
liable to pay any damages as his occupation is not unauthorized or
wrongful until the passing of decree for eviction.
In the case at hand it is not disputed that the Rajasthan Premises
Act applies to the suit premises. It follows that while working out
relations of the parties inter se the provisions of the Rajasthan
Premises Act shall have to be kept in view. The respondent-tenant
holding the premises from the Trust would remain a tenant until the
passing of a decree for eviction on one of the grounds contemplated
by Section 13 of the Act in a suit filed by the Trust - the owner of the
property, against the tenant-respondent. In spite of a threat for
eviction by the Trust against the respondent, the respondent is neither
liable to be evicted nor his status as tenant liable to suffer adversely
except by a judicial pronouncement and that too on having achieved a
finality. In short, so far as the appellant sub-tenant is concerned the
title of the respondent tenant would not come to an end till the passing
of such decree for eviction against him. Even if the Trust has
instituted a suit for eviction the respondent-tenant has a right to
contest. The suit may or may not be decreed. If the suit is dismissed
how can it be said that the 'threat of eviction' by the Trust had
resulted in respondent's eviction by title paramount?
We now proceed to examine whether the appellant could have
directly attorned to the owner-Trust by-passing the respondent-tenant
on 1.4.1983, relying on the event of institution of suit for eviction by
the owner Trust against the tenant-respondent on 30.3.1983 and
whether the said event enables successfully raising of the plea of
tenant-respondent's eviction by paramount title, bringing the
obligation of the appellant sub-tenant to deliver possession over the
tenancy premises to the respondent and to pay rent to him till that
date? Under Section 108 clause (q) of the Transfer of Property Act, in
the absence of contract or local usage to the contrary, it is an
obligation of the tenant to put his lessor into possession of the
property on the termination of the lease. Section 116 of the Evidence
Act, which codifies the common law rule of estoppel between
landlord and tenant, provides that no tenant of immovable property or
person claiming through such tenant, shall, during the continuance of
the tenancy, be permitted to deny that the landlord of such tenant had
at the beginning of the tenancy, a title to such immovable property.
The rule of estoppel so enacted has three main features : (i) the tenant
is estopped from disputing the title of his landlord over the tenancy
premises at the beginning of the tenancy; (ii) such estoppel continues
to operate so long as the tenancy continues and unless the tenant has
surrendered possession to the landlord; (iii) Section 116 of Evidence
Act is not the whole law of estoppel between landlord and tenant. The
principles emerging from Section 116 can be extended in their
application and also suitably adapted to suit the requirement of an
individual case. Rule of estoppel which governs an owner of an
immovable property and his tenant would also mutatis mutandis
govern a tenant and his sub-tenant in their relationship inter se. As
held by the Privy Council in Currimbhoy & Co.Ltd. v. L.A.Creet &
Ors.: AIR 1933 PC 29 and Mt. Bilas Kunwar v. Desraj Ranjit Singh
and Ors. : AIR 1915 PC 96, the estoppel continues to operate so long
as the tenant has not openly restored possession by surrender to his
landlord. It follows that the rule of estoppel ceases to have
applicability once the tenant has been evicted. His obligation to
restore possession to his landlord is fulfilled either by actually
fulfilling the obligation or by proving his landlord's title having been
extinguished by his landlord's eviction by a paramount title holder.
Eviction by paramount title holder is a good defence bringing to an
end the obligation of the tenant to put the lessor in possession of the
property under Section 108 (q) of the Transfer of Property Act. The
burden of proving eviction by title paramount lies on the party who
sets up such defence.
What is eviction by title paramount? In Krishna Prasad Singh
v. Adyanath Ghatak : ILR 1943 Patna 513, Meredith, J. speaking for
the Division Bench and on a review of judicial opinion stated the law
in the following terms:
"To constitute eviction by title paramount no
physical dispossession is necessary. If the true
owner is armed with a legal process for eviction,
which cannot be lawfully resisted, even though the
tenant is not put out of possession the threat to put
him out of possession amounts in law to eviction.
If in such circumstances the tenant openly and to
the knowledge of his landlord attorns to the true
owner the estoppel is gone.
The attornment, however, must be under
compulsion. The party evicting must have a good
and present title, and the tenant must have quitted
against his will."
It was further held in Krishna Prasad Singh's case (supra) that
there is all the difference between mere voluntary attornment and
attornment under compulsion; a mere voluntary attornment would not
enable the tenant pleading eviction by title paramount nor will the
mere institution of a suit against the landlord by the true owner be
enough. An unexecuted decree for possession obtained by a third
party does not per se operate as an eviction of the tenant by title
paramount, liberating him from the estoppel against pleading jus
tertia. This decision was followed by Bose, J. in Pusaram Maniklal
Izardar v. Deorao Gopalrao Mali (minor) by guardian mother
Parwati W/o Gopalrao : AIR 1947 Nagpur 188. Vide para 20, Bose,
J. summed up the facts in the following words:
"If A lets land to B and B enters into possession
under the lease, B is bound to return possession to
A on the expiry of the lease and he will not be
allowed to set up the right or title of a third party
C. If A directs B to surrender possession to C that
might be a different matter. But here there was no
direct communication between A and B. What
happened was that A told C that C could enter into
possession when the lease expired but before that
happened A changed his mind and demanded
possession from his lessee."
In these facts it was held that once A demanded possession
from B, then B cannot be heard to say in answer to that demand that C
has right against A. A was held entitled to the decree for possession
against B.
A decision by Madhya Pradesh High Court in Radheylal v.
Ratansingh : 1977 MPLJ 335 bears a close resemblance with the facts
of the case at hand. The suit premises were owned by the
municipality and on 21.11.1960 taken on rent by the plaintiff. They
were let out by the plaintiff to the defendant . On 30.1.1963 plaintiff
determined the tenancy of the defendant and demanded arrears of rent
as also the possession. On defendant's failure, the plaintiff filed a
suit. The defendant, while admitting that the suit premises were
initially let out to him by the plaintiff, inter alia contended that the
rules of the municipality prohibited sub-letting of the premises and as
dispute was going on between the plaintiff and the municipality, the
defendant had applied to the municipality for grant of lease to him of
the suit premises which was agreed to, and since the year 1962 the
defendant had become tenant of the municipality. Referring to
Section 108 (q) of the Transfer of Property Act, the Madhya Pradesh
High Court held that the obligation of the tenant to hand over
possession to the landlord on determination of tenancy cannot be
escaped by the tenant contending that he has entered into a contract of
tenancy with a person who has paramount title over his landlord and
by voluntarily entering into contract with a person from whom his
lessor was holding the lease. The landlord's tenancy had not come to
an end by operation of law, and therefore, in the opinion of the
Madhya Pradesh High Court, the sub-tenant's voluntarily becoming
the tenant of the municipality and that too without the consent of the
plaintiff (that is, his own landlord) could not be set up as a defence for
discharging his obligation under section 108 (q) of the Transfer of
Property Act. Yet another reason on account of which the defendant
was held not entitled to save his possession on the basis of his having
allegedly become the tenant of the municipality was that such
transaction had taken place during the pendency of the suit between
his landlord and himself and therefore, it was hit by the provisions of
Section 52 of the Transfer of Property Act. The defendant being in
actual physical possession of the premises was held bound to deliver
possession to the plaintiff.
In Gajadhar Lodha v. Khas Mahatadih Colliery Co.& Ors. :
AIR 1959 Patna 562 the following statement of law from Foa's
General Law of Landlord and Tenant (Eighth Ed. p.194), has been
quoted with approval by the Division Bench "Eviction by title
paramount means an eviction due to the fact that the lessor had no title
to grant the term, and the paramount title is the title paramount to the
lessor which destroys the effect of the grant and with it the
corresponding liability for payment of rent, so that mere eviction
from, or a deprivation of the use and enjoyment of the demised
premises, or part of them, whether such eviction be lawful or
unlawful, is insufficient, where the lessor's title is not affected or
called in question." To constitute a good defence of eviction by title
paramount, three conditions must be fulfilled: (1) The eviction must
have been from something actually forming part of the premises
demised; (2) the party evicting must have a good title superior to that
of the lessor and that of the lessee, and (3) the tenant must have
quitted against his will. In Sain Dar v. Sant Ram : AIR 1959 Punj
564 it has been held that even if not actually evicted, if a judgment of
eviction has been passed against the tenant, he can repudiate the title
of his immediate landlord. But the mere fact of an apprehension that a
suit for eviction might be brought by the paramount landlord does not
justify denial of title of landlord and attornment to paramount
landlord. We find ourselves in agreement with the above said judicial
opinion and sum up the law as follows:
To constitute eviction by title paramount so as to discharge the
obligation of the tenant to put his lessor into possession of the leased
premises three conditions must be satisfied: (i) the party evicting must
have a good and present title to the property;, (ii) the tenant must have
quitted or directly attorned to the paramount title holder against his
will: (iii) either the landlord must be willing or be a consenting party
to such direct attornment by his tenant to the paramount title holder or
there must be an event, such as a change in law or passing of decree
by a competent court, which would dispense with the need of consent
or willingness on the part of the landlord and so bind him as would
enable the tenant handing over possession or attorning in favour of the
paramount title holder directly; or, in other words, the paramount title
holder must be armed with such legal process for eviction as cannot
be lawfully resisted. The burden of raising such a plea and
substantiating the same, so as to make out a clear case of eviction by
paramount title holder, lies on the party relying on such defence.
The appellant has on 25.12.1975, obtained the premises on rent
from the respondent and was inducted into possession by the
respondent. The title of the respondent to lease out the suit premises
and to induct the appellant cannot be denied or disputed by the
appellant so long as his sub-tenancy continues and he is in possession
thereunder. On 30.3.1983, the Trust instituted a suit for eviction
against the respondent and soon on 1.4.1983 the appellant voluntarily
attorned in favour of the Trust without the consent of the respondent
and without any compulsion.
We have already stated that the respondent's tenancy in the suit
premises will not come to an end unless and until a decree for eviction
on one of the grounds available under the Rajasthan Act has been
passed against him and termination of his tenancy upheld by a judicial
verdict. Till then he would remain a tenant of the Trust. Mere
institution of a suit for eviction by the Trust, the owner of the
property, against the respondent does not bring the tenancy of the
respondent to an end. The respondent cannot be said to have been
evicted by title paramount. It cannot be said that the respondent-
tenant does not have any defence nor can he lawfully resist the suit
filed by the owner Trust. The plain and simple legal position which
flows is that the appellant must discharge his statutory obligation to
put his landlord, that is, the respondent in possession of the premises
in view of the latter's entitlement to hold the tenancy premises until
his own right comes to an end and the respondent must discharge his
statutory obligation to put his own landlord, that is, the Trust, in
possession of the tenancy premises on his entitlement to hold the
tenancy premises coming to an end.
We may now deal with D. Satyanarayana's case (supra) relied
on by the learned counsel for the appellant. A suit for eviction from
the demised premises was decreed under Section 10(2) (vi) of the
Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act,
1960 which provides for eviction of a tenant if the tenant has denied
the title of the landlord or claimed a right of permanent tenancy and
such denial or claim was not bona fide. The limited question arising
for decision before this Court was whether the appellant was estopped
from denying the title of the lessor under Section 116 of the Evidence
Act, 1872 despite the fact that there was threat of eviction by the
owner of the demised premises by a person having title paramount so
as to examine whether such denial could be said to be bona fide or
not. There was no dispute on facts. The statement of facts as set out
in the judgment of this Court shows that the appellant was
'constrained to attorn in favour of the original lessor'. The High
Court had upheld the decree of eviction passed by the Trial Court
resting its judgment on the rule of estoppel. This Court stated the rule
of estoppel and set out the well-settled exceptions to which the
general rule of estoppel between landlord and tenant is subject :
firstly, a tenant is not precluded from denying the derivative title of
the persons claiming through the landlord; secondly, the estoppel is
restricted to the denial of the title at the commencement of the
tenancy, that is, it is open to the tenant even without surrendering
possession to show that since the date of the tenancy, the title of the
landlord came to an end or that he was evicted by a paramount title
holder or that even though there was no actual eviction or
dispossession from the property, under a threat of eviction he had
attorned to the paramount title holder. That there was threat of
eviction and as a result of such threat the tenant attorned to the real
owner was opined to be sufficient to constitute eviction by title
paramount, however, this Court has emphatically stated that if the
tenant gives up possession voluntarily to the title holder, he cannot
claim the benefit of this rule. The judgment of this Court in D.
Satyanarayana's case has to be read as laying down that in the facts
of that case the plea of the tenant that his landlord's title had come to
an end did not amount to a denial or claim which was not bona fide so
as to attract applicability of clause (vi) of sub-section (2) of Section 10
of the A.P. Buildings Control Act. The common law rule of estoppel,
as codified in Section 116 of Evidence Act and its exceptions have
been dealt with for determining the core issue whether the tenant
denying title of landlord could be said to have done so bona fide or
not. In D. Satyanarayana's case nowhere this Court has examined
whether the relationship between the alleged paramount title holder
and the landlord was governed by rent control law or not, nor the
question of obligation of tenant to hand over possession to his
landlord under Section 108 (q) of Transfer of Property Act came up
for consideration. These are the features which distinguish D.
Satyanarayana's case from the case before us. In the case before us
the plea of eviction by paramount title is not available to the appellant
for three reasons : firstly, it cannot be said that the Trust is armed with
a legal process for eviction which cannot be lawfully resisted by the
tenant-respondent or to which he has no defence; secondly, the
attornment by the appellant in favour of the Trust is voluntary and not
under any compulsion; and thirdly, it cannot be said that the Trust has
such good and present title against the tenant-respondent so as to hold
the appellant liable to be evicted against his will. As already stated,
and even at the risk of repetition, it has to be emphasised that, in view
of the tenant-respndent's relationship with the Trust being one
governed by the provisions of the rent control law, his title as tenant
(and hence as landlord as against the sub-tenant appellant) will not
come to an end unless and until the suit for eviction filed by the Trust
against the respondent is decreed and the decree has achieved finality.
For the foregoing reasons, the appeals are dismissed with costs.
.J.
( R.C. Lahoti )
.J.
( Brijesh Kumar)
January 11, 2002
