Full Judgment Text
2009:BHC-AS:15281
1
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO.2682 OF 2009
Surendra B. Agarwal & Anr. .. Petitioners
versus
AML Merchandising Pvt Ltd. .. Respondent
Mr.D.Madan, Sr.Counsel alongwith Mr.Farhan Dubash i/by
M/s.Dastur Dadhich & Kalambi for the petitioners.
Mr.Karim Vakil alongwith Mr.Sanjay Chaturvedi for the respondent.
CORAM : A.S.OKA, J.
th
DATE : 11 September 2009.
ORAL JUDGMENT:
. By this writ petition under Article 227 of the Constitution of India
the petitioners have taken an exception to the judgment and order
th
dated 17 January 2009 passed by the learned Additional
Commissioner, Konkan Division. The petition arises out of
proceedings of application under section 24 of the Maharashtra Rent
Control Act, 1999 (hereinafter referred to as the said Act).
2. With a view to appreciate the submissions made by the learned
counsel appearing for the parties, it will be necessary to briefly refer
to the facts of the case. The petitioners herein are applicants in an
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application filed under section 24 of the said Act and the respondent
company in this petition is the respondent in the said application.
The petitioners have described the suit premises subject matter of
dispute in paragraph 3 of the application. It is stated that one
Mrs.Najoo Behram Bhiwandiwala was the original owner of the larger
property in which the suit premises are situated. The petitioners claim
th
that by Deed of Conveyance dated 13 December 2007 they have
acquired a larger property from the said Mrs.Najoo Bhiwandiwala.
The case of the petitioners is that under an earlier Agreement dated
th
28 February 2002 executed by the said Mrs.Najoo, M/s.Dream
Trading Company Pvt Ltd was inducted as a licensee in the suit
premises. The said predecessor of the petitioners by Agreement
st
dated 21 March 2003 inducted the respondent as a licensee.
Reliance has been placed on Leave and Licence Agreement dated
st
21 March 2003. It is contended that the respondent had agreed to
pay a sum of Rs.1,00,000/- as monthly compensation. Reliance is
th
placed on supplemental Agreement, dated 8 September 2004
executed by and between the said Mrs.Najoo Bhiwandiwala and the
respondent. It is stated that under the said supplemental Agreement
the respondent was permitted to carry out certain works of additions
or alterations subject to the terms and conditions incorporated in the
said Agreement. It is alleged that the original owner Mrs.Najoo
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Bhiwandiwala had filed an application for eviction under section 24 of
the said Act before the Competent Authority against the respondent.
The respondent has filed a suit for declaration and injunction in which
the respondent has claimed that he has right to occupy the suit
th
premises as a licensee upto 27 February 2008.
3. In the present application filed by the petitioners under section
24 of the said Act it was contended that the licence expired with efflux
th
of time on 27 February 2008. It it alleged in the application that the
th
respondent had paid compensation up to 27 May 2006 to the
predecessor of the petitioners. Various reliefs were claimed in the
application, such as, recovery of possession, a direction to pay
undisputed amount of compensation and direction to pay double the
th
amount of agreed compensation with effect from 28 May 2007. It
must be noted here that an application for intervention was made in
the said application by a third party Mr.Nirav Modi. It is the case
made out in the said application that the predecessor of the
petitioners had executed a declaration under which an option was
given to the said Mr.Modi to purchase the suit premises for
consideration mentioned therein. It is stated that reference to the said
st
declaration has been incorporated in the Agreement dated 21 March
2003 executed by the petitioner’s predecessor in favour of the
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respondent. A suit filed by said Mr.Modi on the original side of this
Court is pending. The suit is for specific performance of the alleged
Agreement for Sale. The application for intervention made by the said
third party came to be rejected by the Competent Authority. The said
order was challenged by the said Mr.Modi. However, it is not
necessary to go into those details as the controversy relating to rights
of the said Mr.Modi may not be subject matter of this petition.
4. The respondent filed an application for seeking leave to defend
the said application filed by the petitioners. The said application was
th
contested by the petitioners by filing a reply. On 14 July 2008, the
Competent Authority rejected the application for leave to defend filed
by the respondent. On the same day, the main application under
section 24 of the said Act was finally decided by the Competent
Authority directing the respondent to handover vacant and peaceful
possession of the suit premises to the petitioners. The directions
were also issued for payment of compensation at the agreed rate up
th
to 27 February 2008 and to pay the compensation at the rate of Rs.
th
2,00,000/- per month with effect from 28 February 2008. A direction
was also given to the petitioners to return the security deposit after
deducting arrears of compensation. The respondent preferred a
revision application under section 44 of the said Act. By the impugned
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th
judgment and order dated 17 January 2009, the order of eviction
passed by the Competent Authority was quashed and set aside. The
Additional Commissioner who was the Revisional Authority directed
the Competent Authority not to proceed with the application till the
civil suits, namely, the suit for declaration and injunction filed by the
respondent and suit for specific performance filed by the said Mr.Modi
are finally decided.
5. The learned counsel appearing for the parties have made
elaborate submissions. The learned senior counsel appearing for the
petitioners after inviting the attention of the Court to the scheme of
the said Act pointed out that there was no occasion for the Revisional
Authority to set aside the order of eviction. He submitted that there is
no dispute that the entry of the respondent in the suit premises is as
a licensee under the Agreement executed by the predecessor of the
petitioners. He submitted that the petitioners have taken the property
under registered Sale Deed and what is claimed by the said Mr.Modi
is only an Agreement for Sale. He submitted that there is absolutely
no defence available to the respondent to contest the application and
by a reasoned order the Competent Authority has rejected the prayer
for grant of leave to defend. He submitted that once the execution of
Leave and Licence Agreement was established, the respondent had
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no defence. He submitted that the Competent Authority could not
have stayed the proceedings under section 24 of the said Act only on
the ground that a suit for declaration filed by the respondent-licensee
was pending. He submitted that as the Competent Authority had no
jurisdiction to stay the proceedings of application under section 24 of
the said Act the Revisional Authority could not have staged the
proceedings. He placed reliance on a decision of this Court in the
case of Mr.Rajendra B. Nair Vs. Suresh D. Dyanmothe & Anr (AIR
2002 Bombay 382). He submitted that though the decision deals with
a similar provision, namely, section 13-A2 under the Bombay Rents,
Hotel and Lodging House Rates (Control) Act, 1947, the ratio of the
decision is squarely applicable to the present case. He submitted that
the revision application ought to have been dismissed.
6. The learned counsel appearing for the respondent submitted
that the Competent Authority has committed an error by not granting
leave to defend. He submitted that there were number of valid and
plausible defences raised by the petitioner including a defence that
as the respondent was permitted to carry out work of permanent
nature, the licence has become irrevocable. He submitted that this
was a fit case where leave to defend ought to have been granted in
favour of the respondent. He pointed out that in a suit for declaration
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and injunction filed by the respondent, injunction was granted against
the predecessor of the petitioners which has been confirmed by the
Appellate Court. He submitted that even the Agreements of Leave
and Licence on which reliance is placed by the petitioners refers to
the rights created in favour of the said Mr.Modi whose suit for specific
performance is pending before this Court. He submitted that
considering the nature of pending suits, the learned Additional
Commissioner has committed no error and he rightly directed the
Competent Authority to stay its hands till the suits are finally decided.
He placed reliance on the decisions of the Apex Court:
(1)(2000) 5 SCC 708:- Llaq Ahmed Vs. Habeeb-U-Rehman
(2)(2001) 1 SCC 706 :-Inderjeet Kaur Vs. Nirpal Singh
(3)AIR 2001 SC 2176:- Manoj Kumar Vs. Bhiarilal
(4)AIR 1982 SC 1518:-Precision Vs. Prem Deva
He submitted that no interference is called for.
7. I have given careful consideration to the submissions. Section
24 of the said Act forms part of Chapter V of the said Act. The chapter
V deals with “special provisions for recovery of possession in certain
cases”. The section 24 reads thus:
“24. (1) Notwithstanding anything contained in this Act, a
licensee, in possession or occupation of premises given to
him on licence for residence shall deliver premises of such
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premises to the landlord on expiry of the period of licence;
and on the failure of the licensee to so deliver the possession
of the licensed premises, a landlord shall be entitled to
recover possession of such premises from a licensee, on the
expiry of the period of licence, by making an application to the
Competent Authority, and the Competent Authority, on being
satisfied that the period of licence has expired, shall pass an
order of eviction of a licensee.
(2) Any licensee who does not deliver possession of
the premises to the landlord on expiry of the period of licence
and continues to be in possession of the licensed premises till
he is dispossessed by the Competent Authority shall be liable
to pay damages at double the rate of the licence fee or
charge of the premises fixed under the agreement of licence.
(3) The Competent Authority shall not entertain any
claim of whatever nature from any other person who is not a
licensee according to the agreement of licence.
Explanation.- For the purposes of this section,-
(a) the expression “landlord” includes a successor-in-
interest who becomes the landlord of the premises as a result
of death of such landlord; but does not include a tenant or a
sub-tenant who has given premises on llicence;
(b) an agreement of licence in writing shall be
conclusive evidence of the fact stated therein.”
8. Under sub-section 3 it is provided that a Competent Authority
shall not entertain any claim of whatever nature from any other
person who is not a licensee according to the Agreement of Licence.
Clause (b) of explanation to sub-section 3 of section 24 of the said
Act provides that an Agreement of Licence in writing shall be
conclusive evidence of the facts stated therein. Thus, from section 24
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of the said Act it appears that a proceeding under section 24 of the
said Act is between a landlord (or licensor) and a licensee. The
Competent Authority is conferred with a limited jurisdiction under sub-
section 1 of section 24 of the said Act and while exercising that
limited jurisdiction the Competent Authority cannot entertain a claim
of any third party who is not a licensee according to the Agreement of
Licence. Moreover, Agreement of Licence in writing has been made
a conclusive evidence of the facts stated therein.
9. At this juncture, it will be also necessary to consider the
procedural provisions of the said Act which lay down the procedure
for deciding applications under section 24 of the said Act. The said
provisions are found in Chapter VIII of the said Act. The title of
Chapter VIII is “Summary Disposal of Certain Applications”. The
section 39 gives provisions of the said Chapter or Rules made
thereunder an overriding effect and provides that the provisions of the
said Chapter and Rules 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. The section
43 enacts a special procedure for disposal of the applications. The
sub-section 4 of section 43 provides that a tenant or licensee to
whom summons is duly served shall not contest the prayer for
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eviction from the premises, unless within 30 days of service of
summons on him, he files an affidavit stating grounds on which he
seeks to contest the application for eviction and obtains a leave from
the Competent Authority. The said provision has been held to be
mandatory by the Apex Court and there is no provision for extension
of time of 30 days provided in the said provision. What is material is
clause (c) of sub-section 4 of section 43 which provides that once
leave is granted, the Competent Authority has to proceed with the
hearing on day to day basis and decide the application as far as
possible within six months. There is no provision for preferring an
appeal against the order passed by Competent Authority. The only
remedy provided in the Statute is of filing a revision application
against the order of Competent Authority. Section 47 enacts “bar of
jurisdiction”. Section 47 reads thus:
“47.Bar of jurisdiction.- Save as otherwise expressly
provided in this Act, no civil court shall have jurisdiction in
respect of any matter which the Competent Authority or the
State Government or an officer authorised by it is
empowered by or under this Act, to decide, and no injunction
shall be granted by any court or other authority in respect of
any action taken or to be taken in pursuance of any power
so conferred on the Competent Authority or the State
Government or such officer”.
10. Thus, the special provision has been made under the said Act
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for evicting the licensees of premises given on licence for residence.
A special procedure laid down under Chapter VIII governs the
application made under section 24 of the said Act. The said Act
contemplates a summary disposal of the applications. By the very
nature of the proceedings as reflected from the aforesaid statutory
provisions, the jurisdiction of Competent Authority is very limited. It
can decide a dispute between a landlord (lincesor) and the licensee.
It is obvious that considering the summary nature of the proceedings,
issue of title to the disputed premises can never be decided in such
proceedings. The sub-section 1 of section 24 starts with non-obstante
clause. Moreover section 39 of the said Act gives overriding effect to
the provisions of Chapter VIII. Therefore, pendency of a suit
governed by section 33 of the said Act or a suit on title cannot
prevent the competent authority from deciding an application for
eviction. There is no statutory power vesting the Competent Authority
to stay the proceedings of the application under section 24 of the said
Act on the ground of pendency of a civil suit relating to the property.
11. All that is required to be considered by the Competent Authority
is whether the landlord has given the premises on licence for
residence and whether on expiry of period of licence the licensee has
not delivered the possession of the premises subject matter of
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licence. Sub-section 3 of section 24 of the said Act specifically
prevents the Competent Authority from considering a claim of any
stranger. The intention of legislature of making an Agreement of
Licence in writing as a conclusive evidence of the facts stated therein
cannot be altogether ignored.
12. Hence, once application under section 24 of the said Act is filed
by the licensor, the Competent Authority has to decide the said
application in accordance with law. The Competent Authority is not
really concerned with the title of the licensor. All that is required to be
examined is whether the applicant is a licensor and whether the
opponent is the licensee and whether there was a Leave and Licence
Agreement for residential use of the suit premises. In a case where
licensee is claiming some other rights in relation to the premises in
dispute, adjudication of the said rights cannot be made by the
Competent Authority. Therefore, if a suit relating to the title of the
licensor is pending or if a suit for declaration filed by the licensee
claiming declaration of rights is pending, that is no ground to detain
the hearing of application under section 24 of the said Act. The
pendency of suits in the Civil Court or other Competent Court relating
to the premises in dispute does not affect the jurisdiction of the
Competent Authority to decide the application. While deciding the
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application under section 24 of the said Act the Competent Authority
cannot decide the issue of title.
13. In the case of Rajendra B. Nair (supra), this Court was dealing
with an identical provision viz; section 13A-2 of the Bombay Rents,
Hotel & Lodging House Rates (Control) Act, 1947. This Court
considered the effect of pendency of a declaratory suit filed by the
licensee claiming a declaration of tenancy. Paragraph 12 of the said
decision reads thus:
“. The pendency of the declaratory suit which has
been filed by the respondent before the Small Causes
Court cannot detract from the legal position which
ensues under S.13-A2 or affect the jurisdiction,
statutorily conferred upon the competent authority of
ordering the eviction of a licensee whose entitlement
to occupy the premises has come to an end upon the
expiry of the licence. The provisions of S.13-A2 have
effect, notwithstanding anything contained in the Rent
Act . A licensee cannot claim an immunity from the
obligation cast upon him by S.13-A2 to vacate the
premises upon the expiry of the licence by the institution of
a Declaratory Suit in the Small Causes Court. Nor can he
claim an immunity from the jurisdiction of the competent
authority to order him to vacate when he fails to do so upon
the expiry of the licence. Section 13-A2 frowns upon
such subterfuge and it is the plain duty and obligation
of the Court to give effect to the legislative
mandate .”(Emphasis added)
What is held by this Court squarely applies to proceedings under
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section 24 of the said Act. Therefore, the revisional Authority has
committed a gross error by directing that the Competent Authority
cannot proceed with application under section 24 of the said Act
merely because a declaratory suit filed by the respondent is pending
and merely because the suit for specific performance filed by a third
party is pending. If the third party who has filed a suit for specific
performance succeeds, it is obvious that on the basis of the said
decree the third party can take appropriate steps.
14. The next question which requires to be decided is whether
there was any justification on the part of the learned Additional
Commissioner for setting aside the order passed by the Competent
Authority and for remitting the matter to the Competent Authority. The
revision application was directed against the order of the Competent
Authority of passing order of eviction and of rejecting the application
for grant of leave to defend. The learned Additional Commissioner
who was exercising revisional jurisdiction was required to decide the
revision application in accordance with law. It will be necessary to
peruse the impugned order passed by the Revisional Authority.
Firstly, Additional Commissioner has dealt with the question whether
the petitioners were landlords. The second question which is
addressed to by the learned Additional Commissioner is whether the
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said Mr.Modi was a necessary party in the application. The Additional
Commissioner holds that the conclusion drawn by the Competent
Authority that Mr.Modi is a separate entity and he has nothing to do
with Leave and Licence Agreement is definitely wrong. Thereafter, the
learned Additional Commissioner has referred to the declaration on
the basis of said Mr.Modi has filed a suit for specific performance.
The learned Additional Commissioner has thereafter observed as
under:
“....... I have gone through the notorised declaration by
th
Mrs.Najoo Bhiwandiwala dated 29 August 2002 para 16(A)
of which reveals that price of property was fixed. Para (b) of
clause speaks about forfeiture of advance money of 10 lacs
and acceptance of Rs.10 lacs by Mrs.Najoo from Modi are
important events and unless proper and detail inquiry is done
giving sufficient and proper opportunity to all necessary
parties to lead evidence, to argue their case, coming to
proper conclusion is impossible.”
Thereafter, the learned Additional Commissioner proceeded to
observe that in the dispute before him, civil rights of the parties were
involved and only Civil Court was competent to decide such issues
having jurisdiction in such matters. The Competent Authority
st
observed that Agreement dated 21 March 2003 is not only a Leave
and Licence Agreement but it discloses rights created in favour of the
respondent and Mr.Modi. Thereafter, the learned Additional
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Commissioner has adverted to the suit filed by the said Mr.Modi and
the suit filed by the respondent.
15. The learned Additional Commissioner was concerned with the
legality and propriety of the order passed by the Competent Authority
of declining to grant leave to defend and the consequential order of
eviction. The learned Additional Commissioner has not really not
gone into the question of legality and proprietary of the order passed
by the Competent Authority of declining to grant leave to defend. He
has completely misdirected himself by going into other issue relating
to rights claimed by Mr.Modi. He has completely ignored the limited
scope of the proceedings under section 24 of the said Act. In my
view, the impugned judgment and order of the learned Additional
Commissioner is perverse.
16. The submission of the learned senior counsel appearing for the
petitioners was that as absolutely no case is made out for grant of
leave to defend by the respondent, the order of eviction passed by
the Competent Authority deserves to be restored. The said
submission cannot be acceded to for the simple reason that the
learned Additional Commissioner has completely misdirected himself
and has not considered the revision application on merits. A remedy
of filing revision application is provided under the Statute. As the
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revisional Authority has not gone into the merits of the application for
leave to defend filed by the respondent, by setting aside the
impugned order, the revision application will have to be ordered to be
heard afresh in the light of the observations made in this judgment
and especially the what is held regarding the scope of the
proceedings under section 24 of the said Act.
17. In the circumstances, I pass the following order:
: O R D E R :
th
(a) The impugned order dated 17 January 2009 passed by
the learned Additional Commissioner, Konkan Division is
quashed and set aside and Revision Applicatioin No.219 of
2008 is restored to the file of learned Additional Commissioner,
Konkan Division.
(b) The parties are directed to appear before the learned
th
Additional Commissioner on 16 October 2009 for fixing the
schedule of hearing.
(c) The Authority will hear and decide the revision application
afresh in the light of observations made by this Court. The
revision application shall be decided as expeditiously as
possible and preferably on or before end of January 2010.
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(d) Till the disposal of the revision application by the
Revisional Authority, the order of eviction passed by the
Competent Authority shall not be executed subject to condition
that the respondent will not create any third party rights in
respect of the suit premises and will not part with possession
thereof.
(e) If the respondent has not paid agreed licence fees, it will
be open for the petitioners to make appropriate application in
that behalf before the Revisional Authority.
(f) Writ petition is partly allowed in above terms.
(g) No orders as to costs.
(A.S.OKA,J)
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO.2682 OF 2009
Surendra B. Agarwal & Anr. .. Petitioners
versus
AML Merchandising Pvt Ltd. .. Respondent
Mr.D.Madan, Sr.Counsel alongwith Mr.Farhan Dubash i/by
M/s.Dastur Dadhich & Kalambi for the petitioners.
Mr.Karim Vakil alongwith Mr.Sanjay Chaturvedi for the respondent.
CORAM : A.S.OKA, J.
th
DATE : 11 September 2009.
ORAL JUDGMENT:
. By this writ petition under Article 227 of the Constitution of India
the petitioners have taken an exception to the judgment and order
th
dated 17 January 2009 passed by the learned Additional
Commissioner, Konkan Division. The petition arises out of
proceedings of application under section 24 of the Maharashtra Rent
Control Act, 1999 (hereinafter referred to as the said Act).
2. With a view to appreciate the submissions made by the learned
counsel appearing for the parties, it will be necessary to briefly refer
to the facts of the case. The petitioners herein are applicants in an
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application filed under section 24 of the said Act and the respondent
company in this petition is the respondent in the said application.
The petitioners have described the suit premises subject matter of
dispute in paragraph 3 of the application. It is stated that one
Mrs.Najoo Behram Bhiwandiwala was the original owner of the larger
property in which the suit premises are situated. The petitioners claim
th
that by Deed of Conveyance dated 13 December 2007 they have
acquired a larger property from the said Mrs.Najoo Bhiwandiwala.
The case of the petitioners is that under an earlier Agreement dated
th
28 February 2002 executed by the said Mrs.Najoo, M/s.Dream
Trading Company Pvt Ltd was inducted as a licensee in the suit
premises. The said predecessor of the petitioners by Agreement
st
dated 21 March 2003 inducted the respondent as a licensee.
Reliance has been placed on Leave and Licence Agreement dated
st
21 March 2003. It is contended that the respondent had agreed to
pay a sum of Rs.1,00,000/- as monthly compensation. Reliance is
th
placed on supplemental Agreement, dated 8 September 2004
executed by and between the said Mrs.Najoo Bhiwandiwala and the
respondent. It is stated that under the said supplemental Agreement
the respondent was permitted to carry out certain works of additions
or alterations subject to the terms and conditions incorporated in the
said Agreement. It is alleged that the original owner Mrs.Najoo
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Bhiwandiwala had filed an application for eviction under section 24 of
the said Act before the Competent Authority against the respondent.
The respondent has filed a suit for declaration and injunction in which
the respondent has claimed that he has right to occupy the suit
th
premises as a licensee upto 27 February 2008.
3. In the present application filed by the petitioners under section
24 of the said Act it was contended that the licence expired with efflux
th
of time on 27 February 2008. It it alleged in the application that the
th
respondent had paid compensation up to 27 May 2006 to the
predecessor of the petitioners. Various reliefs were claimed in the
application, such as, recovery of possession, a direction to pay
undisputed amount of compensation and direction to pay double the
th
amount of agreed compensation with effect from 28 May 2007. It
must be noted here that an application for intervention was made in
the said application by a third party Mr.Nirav Modi. It is the case
made out in the said application that the predecessor of the
petitioners had executed a declaration under which an option was
given to the said Mr.Modi to purchase the suit premises for
consideration mentioned therein. It is stated that reference to the said
st
declaration has been incorporated in the Agreement dated 21 March
2003 executed by the petitioner’s predecessor in favour of the
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respondent. A suit filed by said Mr.Modi on the original side of this
Court is pending. The suit is for specific performance of the alleged
Agreement for Sale. The application for intervention made by the said
third party came to be rejected by the Competent Authority. The said
order was challenged by the said Mr.Modi. However, it is not
necessary to go into those details as the controversy relating to rights
of the said Mr.Modi may not be subject matter of this petition.
4. The respondent filed an application for seeking leave to defend
the said application filed by the petitioners. The said application was
th
contested by the petitioners by filing a reply. On 14 July 2008, the
Competent Authority rejected the application for leave to defend filed
by the respondent. On the same day, the main application under
section 24 of the said Act was finally decided by the Competent
Authority directing the respondent to handover vacant and peaceful
possession of the suit premises to the petitioners. The directions
were also issued for payment of compensation at the agreed rate up
th
to 27 February 2008 and to pay the compensation at the rate of Rs.
th
2,00,000/- per month with effect from 28 February 2008. A direction
was also given to the petitioners to return the security deposit after
deducting arrears of compensation. The respondent preferred a
revision application under section 44 of the said Act. By the impugned
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th
judgment and order dated 17 January 2009, the order of eviction
passed by the Competent Authority was quashed and set aside. The
Additional Commissioner who was the Revisional Authority directed
the Competent Authority not to proceed with the application till the
civil suits, namely, the suit for declaration and injunction filed by the
respondent and suit for specific performance filed by the said Mr.Modi
are finally decided.
5. The learned counsel appearing for the parties have made
elaborate submissions. The learned senior counsel appearing for the
petitioners after inviting the attention of the Court to the scheme of
the said Act pointed out that there was no occasion for the Revisional
Authority to set aside the order of eviction. He submitted that there is
no dispute that the entry of the respondent in the suit premises is as
a licensee under the Agreement executed by the predecessor of the
petitioners. He submitted that the petitioners have taken the property
under registered Sale Deed and what is claimed by the said Mr.Modi
is only an Agreement for Sale. He submitted that there is absolutely
no defence available to the respondent to contest the application and
by a reasoned order the Competent Authority has rejected the prayer
for grant of leave to defend. He submitted that once the execution of
Leave and Licence Agreement was established, the respondent had
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no defence. He submitted that the Competent Authority could not
have stayed the proceedings under section 24 of the said Act only on
the ground that a suit for declaration filed by the respondent-licensee
was pending. He submitted that as the Competent Authority had no
jurisdiction to stay the proceedings of application under section 24 of
the said Act the Revisional Authority could not have staged the
proceedings. He placed reliance on a decision of this Court in the
case of Mr.Rajendra B. Nair Vs. Suresh D. Dyanmothe & Anr (AIR
2002 Bombay 382). He submitted that though the decision deals with
a similar provision, namely, section 13-A2 under the Bombay Rents,
Hotel and Lodging House Rates (Control) Act, 1947, the ratio of the
decision is squarely applicable to the present case. He submitted that
the revision application ought to have been dismissed.
6. The learned counsel appearing for the respondent submitted
that the Competent Authority has committed an error by not granting
leave to defend. He submitted that there were number of valid and
plausible defences raised by the petitioner including a defence that
as the respondent was permitted to carry out work of permanent
nature, the licence has become irrevocable. He submitted that this
was a fit case where leave to defend ought to have been granted in
favour of the respondent. He pointed out that in a suit for declaration
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7
and injunction filed by the respondent, injunction was granted against
the predecessor of the petitioners which has been confirmed by the
Appellate Court. He submitted that even the Agreements of Leave
and Licence on which reliance is placed by the petitioners refers to
the rights created in favour of the said Mr.Modi whose suit for specific
performance is pending before this Court. He submitted that
considering the nature of pending suits, the learned Additional
Commissioner has committed no error and he rightly directed the
Competent Authority to stay its hands till the suits are finally decided.
He placed reliance on the decisions of the Apex Court:
(1)(2000) 5 SCC 708:- Llaq Ahmed Vs. Habeeb-U-Rehman
(2)(2001) 1 SCC 706 :-Inderjeet Kaur Vs. Nirpal Singh
(3)AIR 2001 SC 2176:- Manoj Kumar Vs. Bhiarilal
(4)AIR 1982 SC 1518:-Precision Vs. Prem Deva
He submitted that no interference is called for.
7. I have given careful consideration to the submissions. Section
24 of the said Act forms part of Chapter V of the said Act. The chapter
V deals with “special provisions for recovery of possession in certain
cases”. The section 24 reads thus:
“24. (1) Notwithstanding anything contained in this Act, a
licensee, in possession or occupation of premises given to
him on licence for residence shall deliver premises of such
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8
premises to the landlord on expiry of the period of licence;
and on the failure of the licensee to so deliver the possession
of the licensed premises, a landlord shall be entitled to
recover possession of such premises from a licensee, on the
expiry of the period of licence, by making an application to the
Competent Authority, and the Competent Authority, on being
satisfied that the period of licence has expired, shall pass an
order of eviction of a licensee.
(2) Any licensee who does not deliver possession of
the premises to the landlord on expiry of the period of licence
and continues to be in possession of the licensed premises till
he is dispossessed by the Competent Authority shall be liable
to pay damages at double the rate of the licence fee or
charge of the premises fixed under the agreement of licence.
(3) The Competent Authority shall not entertain any
claim of whatever nature from any other person who is not a
licensee according to the agreement of licence.
Explanation.- For the purposes of this section,-
(a) the expression “landlord” includes a successor-in-
interest who becomes the landlord of the premises as a result
of death of such landlord; but does not include a tenant or a
sub-tenant who has given premises on llicence;
(b) an agreement of licence in writing shall be
conclusive evidence of the fact stated therein.”
8. Under sub-section 3 it is provided that a Competent Authority
shall not entertain any claim of whatever nature from any other
person who is not a licensee according to the Agreement of Licence.
Clause (b) of explanation to sub-section 3 of section 24 of the said
Act provides that an Agreement of Licence in writing shall be
conclusive evidence of the facts stated therein. Thus, from section 24
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9
of the said Act it appears that a proceeding under section 24 of the
said Act is between a landlord (or licensor) and a licensee. The
Competent Authority is conferred with a limited jurisdiction under sub-
section 1 of section 24 of the said Act and while exercising that
limited jurisdiction the Competent Authority cannot entertain a claim
of any third party who is not a licensee according to the Agreement of
Licence. Moreover, Agreement of Licence in writing has been made
a conclusive evidence of the facts stated therein.
9. At this juncture, it will be also necessary to consider the
procedural provisions of the said Act which lay down the procedure
for deciding applications under section 24 of the said Act. The said
provisions are found in Chapter VIII of the said Act. The title of
Chapter VIII is “Summary Disposal of Certain Applications”. The
section 39 gives provisions of the said Chapter or Rules made
thereunder an overriding effect and provides that the provisions of the
said Chapter and Rules 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. The section
43 enacts a special procedure for disposal of the applications. The
sub-section 4 of section 43 provides that a tenant or licensee to
whom summons is duly served shall not contest the prayer for
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10
eviction from the premises, unless within 30 days of service of
summons on him, he files an affidavit stating grounds on which he
seeks to contest the application for eviction and obtains a leave from
the Competent Authority. The said provision has been held to be
mandatory by the Apex Court and there is no provision for extension
of time of 30 days provided in the said provision. What is material is
clause (c) of sub-section 4 of section 43 which provides that once
leave is granted, the Competent Authority has to proceed with the
hearing on day to day basis and decide the application as far as
possible within six months. There is no provision for preferring an
appeal against the order passed by Competent Authority. The only
remedy provided in the Statute is of filing a revision application
against the order of Competent Authority. Section 47 enacts “bar of
jurisdiction”. Section 47 reads thus:
“47.Bar of jurisdiction.- Save as otherwise expressly
provided in this Act, no civil court shall have jurisdiction in
respect of any matter which the Competent Authority or the
State Government or an officer authorised by it is
empowered by or under this Act, to decide, and no injunction
shall be granted by any court or other authority in respect of
any action taken or to be taken in pursuance of any power
so conferred on the Competent Authority or the State
Government or such officer”.
10. Thus, the special provision has been made under the said Act
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11
for evicting the licensees of premises given on licence for residence.
A special procedure laid down under Chapter VIII governs the
application made under section 24 of the said Act. The said Act
contemplates a summary disposal of the applications. By the very
nature of the proceedings as reflected from the aforesaid statutory
provisions, the jurisdiction of Competent Authority is very limited. It
can decide a dispute between a landlord (lincesor) and the licensee.
It is obvious that considering the summary nature of the proceedings,
issue of title to the disputed premises can never be decided in such
proceedings. The sub-section 1 of section 24 starts with non-obstante
clause. Moreover section 39 of the said Act gives overriding effect to
the provisions of Chapter VIII. Therefore, pendency of a suit
governed by section 33 of the said Act or a suit on title cannot
prevent the competent authority from deciding an application for
eviction. There is no statutory power vesting the Competent Authority
to stay the proceedings of the application under section 24 of the said
Act on the ground of pendency of a civil suit relating to the property.
11. All that is required to be considered by the Competent Authority
is whether the landlord has given the premises on licence for
residence and whether on expiry of period of licence the licensee has
not delivered the possession of the premises subject matter of
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12
licence. Sub-section 3 of section 24 of the said Act specifically
prevents the Competent Authority from considering a claim of any
stranger. The intention of legislature of making an Agreement of
Licence in writing as a conclusive evidence of the facts stated therein
cannot be altogether ignored.
12. Hence, once application under section 24 of the said Act is filed
by the licensor, the Competent Authority has to decide the said
application in accordance with law. The Competent Authority is not
really concerned with the title of the licensor. All that is required to be
examined is whether the applicant is a licensor and whether the
opponent is the licensee and whether there was a Leave and Licence
Agreement for residential use of the suit premises. In a case where
licensee is claiming some other rights in relation to the premises in
dispute, adjudication of the said rights cannot be made by the
Competent Authority. Therefore, if a suit relating to the title of the
licensor is pending or if a suit for declaration filed by the licensee
claiming declaration of rights is pending, that is no ground to detain
the hearing of application under section 24 of the said Act. The
pendency of suits in the Civil Court or other Competent Court relating
to the premises in dispute does not affect the jurisdiction of the
Competent Authority to decide the application. While deciding the
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13
application under section 24 of the said Act the Competent Authority
cannot decide the issue of title.
13. In the case of Rajendra B. Nair (supra), this Court was dealing
with an identical provision viz; section 13A-2 of the Bombay Rents,
Hotel & Lodging House Rates (Control) Act, 1947. This Court
considered the effect of pendency of a declaratory suit filed by the
licensee claiming a declaration of tenancy. Paragraph 12 of the said
decision reads thus:
“. The pendency of the declaratory suit which has
been filed by the respondent before the Small Causes
Court cannot detract from the legal position which
ensues under S.13-A2 or affect the jurisdiction,
statutorily conferred upon the competent authority of
ordering the eviction of a licensee whose entitlement
to occupy the premises has come to an end upon the
expiry of the licence. The provisions of S.13-A2 have
effect, notwithstanding anything contained in the Rent
Act . A licensee cannot claim an immunity from the
obligation cast upon him by S.13-A2 to vacate the
premises upon the expiry of the licence by the institution of
a Declaratory Suit in the Small Causes Court. Nor can he
claim an immunity from the jurisdiction of the competent
authority to order him to vacate when he fails to do so upon
the expiry of the licence. Section 13-A2 frowns upon
such subterfuge and it is the plain duty and obligation
of the Court to give effect to the legislative
mandate .”(Emphasis added)
What is held by this Court squarely applies to proceedings under
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14
section 24 of the said Act. Therefore, the revisional Authority has
committed a gross error by directing that the Competent Authority
cannot proceed with application under section 24 of the said Act
merely because a declaratory suit filed by the respondent is pending
and merely because the suit for specific performance filed by a third
party is pending. If the third party who has filed a suit for specific
performance succeeds, it is obvious that on the basis of the said
decree the third party can take appropriate steps.
14. The next question which requires to be decided is whether
there was any justification on the part of the learned Additional
Commissioner for setting aside the order passed by the Competent
Authority and for remitting the matter to the Competent Authority. The
revision application was directed against the order of the Competent
Authority of passing order of eviction and of rejecting the application
for grant of leave to defend. The learned Additional Commissioner
who was exercising revisional jurisdiction was required to decide the
revision application in accordance with law. It will be necessary to
peruse the impugned order passed by the Revisional Authority.
Firstly, Additional Commissioner has dealt with the question whether
the petitioners were landlords. The second question which is
addressed to by the learned Additional Commissioner is whether the
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15
said Mr.Modi was a necessary party in the application. The Additional
Commissioner holds that the conclusion drawn by the Competent
Authority that Mr.Modi is a separate entity and he has nothing to do
with Leave and Licence Agreement is definitely wrong. Thereafter, the
learned Additional Commissioner has referred to the declaration on
the basis of said Mr.Modi has filed a suit for specific performance.
The learned Additional Commissioner has thereafter observed as
under:
“....... I have gone through the notorised declaration by
th
Mrs.Najoo Bhiwandiwala dated 29 August 2002 para 16(A)
of which reveals that price of property was fixed. Para (b) of
clause speaks about forfeiture of advance money of 10 lacs
and acceptance of Rs.10 lacs by Mrs.Najoo from Modi are
important events and unless proper and detail inquiry is done
giving sufficient and proper opportunity to all necessary
parties to lead evidence, to argue their case, coming to
proper conclusion is impossible.”
Thereafter, the learned Additional Commissioner proceeded to
observe that in the dispute before him, civil rights of the parties were
involved and only Civil Court was competent to decide such issues
having jurisdiction in such matters. The Competent Authority
st
observed that Agreement dated 21 March 2003 is not only a Leave
and Licence Agreement but it discloses rights created in favour of the
respondent and Mr.Modi. Thereafter, the learned Additional
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16
Commissioner has adverted to the suit filed by the said Mr.Modi and
the suit filed by the respondent.
15. The learned Additional Commissioner was concerned with the
legality and propriety of the order passed by the Competent Authority
of declining to grant leave to defend and the consequential order of
eviction. The learned Additional Commissioner has not really not
gone into the question of legality and proprietary of the order passed
by the Competent Authority of declining to grant leave to defend. He
has completely misdirected himself by going into other issue relating
to rights claimed by Mr.Modi. He has completely ignored the limited
scope of the proceedings under section 24 of the said Act. In my
view, the impugned judgment and order of the learned Additional
Commissioner is perverse.
16. The submission of the learned senior counsel appearing for the
petitioners was that as absolutely no case is made out for grant of
leave to defend by the respondent, the order of eviction passed by
the Competent Authority deserves to be restored. The said
submission cannot be acceded to for the simple reason that the
learned Additional Commissioner has completely misdirected himself
and has not considered the revision application on merits. A remedy
of filing revision application is provided under the Statute. As the
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revisional Authority has not gone into the merits of the application for
leave to defend filed by the respondent, by setting aside the
impugned order, the revision application will have to be ordered to be
heard afresh in the light of the observations made in this judgment
and especially the what is held regarding the scope of the
proceedings under section 24 of the said Act.
17. In the circumstances, I pass the following order:
: O R D E R :
th
(a) The impugned order dated 17 January 2009 passed by
the learned Additional Commissioner, Konkan Division is
quashed and set aside and Revision Applicatioin No.219 of
2008 is restored to the file of learned Additional Commissioner,
Konkan Division.
(b) The parties are directed to appear before the learned
th
Additional Commissioner on 16 October 2009 for fixing the
schedule of hearing.
(c) The Authority will hear and decide the revision application
afresh in the light of observations made by this Court. The
revision application shall be decided as expeditiously as
possible and preferably on or before end of January 2010.
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(d) Till the disposal of the revision application by the
Revisional Authority, the order of eviction passed by the
Competent Authority shall not be executed subject to condition
that the respondent will not create any third party rights in
respect of the suit premises and will not part with possession
thereof.
(e) If the respondent has not paid agreed licence fees, it will
be open for the petitioners to make appropriate application in
that behalf before the Revisional Authority.
(f) Writ petition is partly allowed in above terms.
(g) No orders as to costs.
(A.S.OKA,J)
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