Full Judgment Text
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PETITIONER:
ASSOCIATED HOTELS OF INDIA LTD., DELHI
Vs.
RESPONDENT:
S. B. SARDAR RANJIT SINGH
DATE OF JUDGMENT:
07/12/1967
BENCH:
BACHAWAT, R.S.
BENCH:
BACHAWAT, R.S.
MITTER, G.K.
CITATION:
1968 AIR 933 1968 SCR (2) 548
CITATOR INFO :
F 1974 SC 280 (6)
R 1987 SC2055 (6)
R 1989 SC1141 (19)
ACT:
Delhi and Ajmer Rent Control Act (38 of 1952), s. 13(1)
proviso (b), (c) and (k)-Hotel premises Constituents of sub-
letting-Knowledge of sub-letting, if waiver.
HEADNOTE:
The respondent-landlord of a hotel filed a suit for eviction
of his tenant-appellant under s. 13(1) proviso (b) and (c)
of the Delhi and Ajmer Rent Control Act, 1952 on the
allegation that the appellant had sub-let several rooms.
These occupants were doing business, which were not confined
to the residents of the hotel. The occupants were given ex-
clusive possession of the rooms occupied by them. The
appellant did not retain any control and dominion over these
rooms. It was not a condition of the grants that the keys
would be left at the reception counter, or that the keys
would be retained by the appellant. The occupants were at
liberty to take away the keys if they liked. The occupants
availed themselves of the services of the hotel sweeper for
their own convenience. The appellant retained control of
the corridor, but the entrance to the corridor was open day
and night. The occupants paid monthly sums to the appellant
as the consideration of the sub-leases. The appellanttenant
denied the allegations and pleaded that the respondent-
landlord had waived the breaches, if any. The suit was
decreed which the High Court, in appeal maintained
HELD : The landlord was entitled to the decree for eviction.
[558 B]
On the question whether the occupier of a separate apartment
in a premises is a licensee or a tenant, the test is has the
landlord retained control over, the apartment Normally, an
occupier of an apartment in a hotel is in the position of
licensee as the hotel-keeper retains the general control of
the hotel including the apartment. But it is not a
necessary inference of law that the occupier of an apartment
in a hotel is not a tenant. A hotel-keeper may run a first
class hotel without sub-letting any part of it. Where as in
this case, the hotel-keeper retained no control over the
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apartment, the occupier was in the position of a tenant.
The onus to prove sub-letting was on the respondent. The
respondent discharged the onus by leading evidence showing
that the occupants were in exclusive possession of the
apartments for valuable consideration. The appellant chose
not to rebut this prima facie evidence by proving and
exhibiting the relevant agreements. [553 D; 554 C-D, F-H;
555 C; 556 E]
Under s. 2(g) "premises" does not include " a room in a
hotel or lodging house". The sub-lessee of a room in a
hotel is, therefore, not a tenant and cannot claim
protection under s. 13 from eviction, nor can he ask for
fixation of standard rent. But, because a room in a hotel
is not premises, it does not follow that the room is not a
part of the hotel premises or that a sub-letting of the room
is not a contravention of cls. (b) and (c) of the proviso to
s. 13(1). [555 F-G 556 A]
Associated Hotels of India Ltd. v. R. N. Kapoor, [1960]1
S.C.R. 368, followed.
Addiscombe Garden Estates Ltd. & Anr. v. Grabbe and Ors.
[1958] 1
QB. 513 and Helman v. Horsham Assessment Committee, [1949]
2 K.B.
335,referred to.
549
A waiver is an intentional relinquishment of a known right.
There can be no waiver unless the person against whom the
waiver is claimed had full knowledge of his rights and of
facts enabling him to take effectual action for the
enforcement of such rights. Assuming that the landlord can
waive the requirement as to consent, it was not shown that
the respondent waived it. It is said that the respondent
knew of the sub-lettings as be frequently visited the hotel
up to 1953 and he must have known of the occupation of some
of the occupants. But he came to know of the other lettings
in 1958 only. Moreover, the precise nature of the grant was
-never communicated to the respondent. [557 B-D]
Dhanukdhari Singh v. Nathima Sahu, [1907] 11 C.W.N. 852,
referred to.
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1249 of
1967.
Appeal from the judgment and decree dated July 21, 1967 of
the Delhi High Court in Regular First Appeal No. 166-D of
1965.
A.K. Sen, Rameshwar Nath, P. L. Vohra and Mahinder
Narain, for the appellant.
Bishan Narain, Radhey Mohan Lal and Harbans Singh, for the
respondent.
The Judgment of the Court was delivered by
Bachawat, J. This appeal arises out of a suit for ejectment
instituted by a landlord against a tenant. It is common
case that the suit is governed by the provisions of’ the
Delhi and Ajmer Rent Control Act, 1952 (Act No. 38 of 1952)
hereinafter referred to as the Act. The material provisions
of s. 13(1) of the, Act are as follows :
"13. (1) Notwithstanding anything to the contrary contained.
in any other law or any contract, no decree or order for the
recovery of possession of any premises shall be passed by
any Court in favour of the landlord against any tenant
(including a tenant whose tenancy is terminated) :
Provided that nothing in this sub-section shall apply to any
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suit or other proceeding for such recovery of possession if
the Court is satisfied-
(b)that the tenant without obtaining the consent of the
landlord in writing has, after the commencement of this
Act,-
(i)sub-let, assigned or otherwise parted with the
possession of the whole or any part of the premises; or
550
(ii) used the premises for a purpose other than
that for which they were let; or,
(c) that the tenant without obtaining the consent
of the landlord has before the commencement of this Act,-
(i)sub-let, assigned or otherwise parted with the
possession of, the whole or any part of the premises;, or
(ii)used the premises for a purpose other than that for
which they were let; or
(k)that the tenant has, whether before or after the
commencement of this Act, caused or permitted to be ,caused
substantial damage to the premises, or notwithstanding
previous notice has used or dealt ’with the premises in a
manner contrary to any condition imposed on the landlord by
the Government, or the Delhi Improvement Trust while giving
him a lease of the land on which the premises are situated;"
The respondent constructed the building known as the Hotel
Imperial, New Delhi, on land leased to him by the Secretary
of State for India in Council under a perpetual lease deed
dated July 9, 1937. By a deed dated August 18, 1939, he
leased to the appellant the hotel premises together with
fittings and furniture for a term of 20 years commencing on
September 15, 1939. On January 28, 1958, the respondent
instituted the present suit alleging that in breach of the
express conditions of the lease dated August .18, 1939, the
appellant sub-let portions of the premises and made
unauthorised additions and alterations in the premises, that
on such breaches he was entitled to determine the lease and
he did so, by notice in writing dated January 6, 1958. He
claimed eviction of the appellant on the grounds mentioned
in cls. (b), (c) and (k) of the proviso to s. 13(1) of the
Act. The appellant filed its written statement on April 3,
1958 denying most of the material allegations in the plaint.
The appellant also pleaded that the respondent had waived
the breaches, if any, of the conditions of the lease by
accepting rents with knowledge of such breaches and
particularly by accepting rent on or about January 3, 1958.
On April 24, 1958, Sri P. L. Vohra, counsel for the
appellant, made the following statement before the trial
Court :
"The plaintiff can seek ejectment of the defendant
only under section 13 of Act 38 of 1952. In case the
551
plaintiff succeeds in establishing the liability of, the
defendant for ejectment on any of the grounds given
in .section 13 of the Rent Act, the defendant would not seek
any protection under the terms of the lease deed dated 18th
August, 1939 executed between the parties, as regards the
period of lease fixed therein. . ."
Having regard to the pleadings and statement of counsel, the
Court settled the following issues on May 12, 1958 :
"1. Whether the defendant had sublet, assigned or otherwise
parted with possession, of any part of the suit premises
before the commencement of Act 38 of 1952 ?
2. If so, was the same done with express or implied
consent of the plaintiff ?
3. Whether the defendant had sublet, assigned or
otherwise parted with possession of any part of the suit
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premises after the commencement of Act 38 of 1952 ?
4.If so, was the same done with the prior consent in
writing of the plaintiff ?
5.Whether the defendant has used the tenancy premises for
a purpose other than that for which they were let ?
6. Whether the defendant has caused substantial
damage to the tenancy premises ?
7. Whether the defendant notwithstanding previous
notice has been. using and dealing with the tenancy premises
in a manner contrary to the conditions imposed on the
plaintiff by, the Government while giving him lease of the
site of the tenancy premises ?
8. Is the defendant entitled to special cost ?
9. Whether the plaintiff is estopped or has waived
his right to seek ejectment of the defendant on any of the
grounds mentioned above ? If so, what and to what effect ?
10.Whether the defendant is entitled to sublet any part of
the hotel premises even when there was a clause to the
contra in the lease dated the 18th August, 1939. and in face
of statutory provisions under the Rent Control Act (for
reasons given in para 16 of the amended written statement)
?"
A tenant holding premises under a subsisting lease is pro-
tected by the lease and needs no protection under the Rent
Act. It was open to the appellant to contend that it was
protected by
552
the terms of the lease dated August 18, 1939, that the
breaches, if any, of the conditions of the lease had been
waived by the respondent and that the lease had not
determined. But the appellant deliberately elected to seek
protection under s. 13 of the Act only. The appellant’s
counsel made a’ formal statement in the trial Court that the
appellant would not seek any protection under the terms of
the lease deed as regards the period of the lease fixed
therein. The Court accordingly settled the ten
issues. Issue No. 8 was not pressed. All the other issues
relate
to thegrounds of eviction mentioned in cls. (b), (c) and
(k)
of theproviso to s. 13(1) of the Act. Issue No. 9
raises the
question- of waiver of the respondent’s right to seek
ejectment on those grounds. Thus, the only questions in
issue between the parties was whether the appellant was
entitled to protection from eviction under s. 13 and whether
any ground for eviction under the Act was made out. The
case was tried and decided on this footing. We have come to
this conclusion after a close examination of the ’pleadings,
particulars, statement of counsel, issues and the judgment
of the trial Court. No issue was raised on the question
whether the breaches of the express conditions of the lease
had been waived by the respondent, and whether the lease was
still subsisting. The appellant sought to raise this plea
in the High Court and also in this Court Having regard to
the deliberate stand taken by the appellant in the trial
Court, the appellant cannot be allowed to raise the plea at
a later stage. The lease determined by efflux of time on
September 15, 1959. Had the appellant taken the plea that
the lease had not determined by forfeiture on the date of
the institution of the suit, it is possible that the
respondent might have filed another suit for ejectment of
the appellant immediately after September 15, 1959. Because
of the stand taken by the appellant, it was not necessary
for the respondent to file another suit. This appeal must
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be decided on the footing that the lease had determined by
forfeiture on the date of the institution of the present
suit. The respondent is entitled to a decree for eviction
if any of the grounds mentioned in cls. (b), (c) and (k) of
the proviso to s. 13(1) is made out.
The trial Court answered issue No. 5 in the negative. With
regard to all the other issues, the trial Court found in
favour of the respondent, and held that the grounds of
eviction mentioned in cls. (b)(1), (c)(i) and (k) were
proved. With regard to the ground of eviction mentioned in
cl. (k), the trial Court held that the appellant was
entitled to relief on certain conditions. The trial Court,
however, held that the respondent was entitled to an
unconditional decree, for eviction on the ground of sub-
letting mentioned in cls. (b)(i) and (c)(i). The appellant
preferred
553
an, appeal to the High Court. The High Court agreed with
all the findings of the trial Court, and dismissed the
appeal.
The two Courts- concurrently found that the appellant had
sub-let several rooms, counters, showcases -and garages.
The two Courts found that the appellant had sub-let rooms to
(1) Pan American World Airways, (2) Mercury Travels, India
(Private) Ltd., travel agents, (3) Indian Art Emporium,
dealers in curios and jewellery, (4) Shanti Vijay and Co.,
dealers in jewellery, (5) Roy and James, hairdressers, (6)
Sita World Travels, travel agents and (7) Ranee Silk Shop,
dealers in saris and curios. The businesses of the sub-
lessees were not confined to the residents of the hotel.
The letting to Pan American World Airways and Indian Art
Emporium were before the commencement of the Act and the
lettings to Mercury Travels, Shanti Vijay and Co., and Roy
and James were after the commencement of the Act. Sita
Travels and Ranee Silk Shop were inducted as tenants after
the institution of, the suit. The entrances to the rooms
were in ,the main corridor of the hotel on the ground floor.
The concurrent finding is that the occupants were given
exclusive possession of the rooms occupied by them. The
appellant did not retain any control and dominion over the
rooms. It is possible that the keys of the apartments were
sometimes left at the reception counter, but the evidence on
this point was not convincing. It was not a condition Of
the grants that the keys would be left at the reception
counter, or that the duplicate keys would be retained by the
appellant. The occupants were at liberty to take away the
keys if they liked’. The occupants availed themselves of
the services of the hotel sweeper for, their own
convenience. The appellant retained control of the
corridor, but it is common case before us that the entrance
to the corridor was open day and night. The occupants paid
monthly sums to the appellant as the consideration of the
sub-leases. The consideration though described as license
fee was in reality rent. The portion occupied by Roy and
James has an interesting history. It was formerly sub-let
to R. N., Kapoor. In Associated Hotels of India Ltd. v. R.
N. Kapoor(1), this Court held by a majority on a
construction of the grant to R. N. Kapoor that he was a
lessee and not a licensee. Roy and James began to occupy
this portion of the premises from February, 1955. According
to the appellant, the agreements with Roy and James, Mercury
Travels and Shanti Vijay and Co., were in writing. The
appellant produced several documents in Court at an early
stage of the suit. The appellant’s case was that these
documents were the relevant agreements. According to the
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respondent, the documents were not genuine and the real
agree-
(1) [196] 1 S.C.R. 36F
554
meats were being withheld. The stamp auditor noted on the
documents the deficiency-in stamps and penalty leviable on
them on the footing that they were lease deeds. The
appellant did not contest this note nor paid the penalty and
deficiency as directed by the trial Court. -The surprising
feature of the case is that the appellant did not attempt to
prove any of the documents. Where the agreement is in
writing, it is a question of construction of the agreement
whether the grant is a lease or a license. It was for the
appellant to prove the written agreements, and the Court
could then construe them. The appellant has not brought
before the Court the best and the primary evidence of the
terms on which the apartments were being occupied. The onus
to prove sub-letting was on the respondent. The respondent
discharged the onus by leading evidence showing that the
occupants were in exclusive possession of the apartments for
valuable consideration. The appellant chose not to rebut
this prime facie evidence by proving and exhibiting the
relevant agreements. The documents formed part of the
appellant’s case. The appellant bad no right to withhold
them from the scrutiny of the Court. In the absence of the
best evidence of the grants, the Courts below properly
inferred sub-lettings from the other materials on the
record.
The test of exclusive possession, though not conclusive, is
a very important indication in favour of tenancy, see
Addiscombe Garden Estates Ltd. and Anr. v. Crabbe and
Ors.(1) The argument is that as the landlord is living in
the premises, that fact raises the presumption that he
intends to retain the control of the whole of the premises
and that the occupation of the other parts is that of a
lodger or inmate and not that of a tenant, and reliance was
placed on Helman v. Horsham Assessment Committee(2) and the
cases referred to therein. Those cases consider what
constitute rateable occupation. In the case last cited,
Denning, L. J. said that a person who is regarded as a
lodger for rating purposes need not necessarily be a lodger
for the purposes of the Rent Restriction Acts, while
Evershed L.J. seems to have expressed a contrary opinion.
Normally, an occupier of an apartment in a hotel is in the
position of a licensee as the hotel-keeper retains the
general control of the hotel including the apartment. But
it is not a necessary inference of law that the occupier of
an apartment in a hotel is not a tenant. Where, as in this
case, the hotel-keeper retains no control over the apart-
ment, the occupier is in the position of a tenant. In
Halsbury’s Laws of England, Vol. 23, Art. 1028, p. 433, the
law is accurately summarised thus
"A lodger who has no separate apartment is only a licensee,
and, even though he has a separate apart-
(1) [1958] 1 Q.B. 513, 525.
(2) [1949] 2 K.B. 335.
555
ment, he has not in law an exclusive occupation, and is
therefore in the position of a licensee, if the landlord
retains the general control and dominion of the house,
including the part occupied by the lodger; but, if in fact
the landlord exercises no control over that part, the
occupier is a tenant. The occupier does not, however,
become a lodger merely by reason of the fact that the
landlord resides on the premises and retains control of the
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passages and staircases and other parts used in common."
On the question whether the occupier of a separate apartment
in a premises is a licensee or a tenant, the test is-has the
landlord retained control over the apartment ? The fact that
the apartment is a room in a hotel may lead to the inference
that the hotel-keeper retains the general dominion of the
en-tire hotel including the apartment and that the occupier
is in the position of a lodger or inmate. But the inference
is not a necessary inference of law. Where, as in this
case, the best evidence of the -rant was withheld from the
scrutiny of the Court, the inference was rightly drawn that
the occupiers were tenants.
At the hearing of this appeal, the appellant moved an appli-
cation for reception of the documents as additional
evidence. The genuineness of the documents was disputed by
the respondent. In the Courts below, the appellant made no
attempt to prove these documents. We found no ground for
directing a new trial. Having regard to all these facts, we
dismissed the application.
The hotel building constitutes premises within the meaning
of s. 2(g) of the Act.’ It is because the hotel building
constitutes Premises that the appellant can claim protection
from eviction under the Act. A room in a hotel is a part of
the hotel premises. A sub-letting of a room in a hotel in
contravention of cls. (b) and (c) of the proviso to s. 13(1
) is a ground for eviction under the Act. Section 2(g)
provides that ’premises’ does not include " a room in a
hotel or lodging house." The sub-lessee of a room in a hotel
is, therefore, not a tenant and cannot claim protection
under s. 13 from eviction, nor can he ask for fixation of
standard rent. see Associated Hotels of India Ltd. v. R. N.
Kapoor(1). If the interest of the tenant of the hotel
premises is determined, the sub-tenant to whom a room in the
hotel has been lawfully sublet becomes under s, 20 a direct
tenant of the landlord, It may be that when the sub-tenant
of a room in a hotel becomes a direct tenant under s. 20 he
enjoys the protection of the Act because the room is no,
longer a room in a hotel. But that point does not arise and
need not be decided. Because a room in a hotel is not
(1) [1960] 1 S.C.R. 368.
556
premises, it does not follow that the room is not a part of
the hotel premises or that a sub-letting of the room is not
a contravention of cls. (b) and (c) of the proviso to s.
13(1).
The Courts below concurrently found that the sub-lettings
after the commencement of the Act were made without
obtaining the consent of the landlord in writing, and the
sub-lettings before the commencement of the Act were made
without obtaining the consent of the landlord either orally
or in writing. We are not inclined to interfere with this
concurrent finding.
It is said that by the lease deed dated August 18, 1939 the
respondent impliedly consented to this sub-letting. Clauses
21 .and 22 of the lease are in these terms
"21. That the lessee shall not be entitled to either
transfer or sub-lease the premises or any part thereof to
any other party without the written consent of the lessor
and on such transfer, both the transferee and the lessee
shall be liable for the payment of rent to the lessor and
responsible to deliver,possession of the building and
equipments in the same condition as when taken.
22.That the lessee will use the premises only for the
purpose of running a first class hotel."
It is -,aid that for the purpose of running a first class
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hotel it was necessary to sub-let the apartments. It is
impossible to accept the contention. A hotel-keeper may run
a first class hotel without sub-letting any part of it.
Clause 21-clearly provided that the lessee shall not sub-
lease the hotel premises or any part thereof. In the teeth
of cl. 21, it is impossible to read in cl. 22 an implied
consent to sub-letting.
Reliance is placed on the correspondence passed between the
Land Development Officer, New Delhi and the respondent bet-
ween April 1948 and February 1949 for establishing that the
respondent gave written consent to the sub-lettings. The
Land and Development Officer was then complaining of the
occupation of portions of the premises by Pan American World
Airways and other persons. By his letters dated November 4,
1948 and February 23, 1949, the respondent requested the
Land and Development Officer to regularise the matter adding
that in an first class hotels counters of air-lines and
show-rooms of jewellery and curios were always provided.
These letter,.; do not amount to a consent in writing to
sub-lettings of portions of the hotel to the persons
mentioned therein. Moreover, the consent, if any, ’was to
the sub-lettings made before 1949 and not to the sub-
lettings made thereafter. It is not possible to infer from
these letters a general consent to all sub-lettings.
557
It is argued that the respondent waived the requirement of
consent to the sub-letting. Any subletting in breach of the
provisions of cl. (b) of the proviso to S. 13 ( 1) is an
offence punish-able under s. 44. Assuming that the landlord
can waive the requirement as to consent, it is not shown
that the respondent waived it. A waiver is an intentional
relinquishment of a known right., There can be no waiver
unless the person against whom the waiver is claimed had
full knowledge of his rights and of facts enabling him to
take effectual action for the enforcement of such rights.
See Dhanukdhari Singh v. Nathima Sahu(1). It is said that
the respondent knew of the sub-lettings as he frequently
visited the hotel. It appears that he visited the hotel up
to 1953 and he must have known of the occupation of R. N.
Kapoor, Indian Art Emporium and Pan American World Airways.
But he came to know of the other lettings in January 1958
only. Moreover, the precise nature of the grant was never
communicated ,to the respondent. The Courts below rightly
held that the respondent did not waive his right to evict
the appellant on the ,-rounds mentioned in cls. (b) and (c)
of the proviso to s. 13 (1).
We are therefore satisfied that the respondent is entitled
to evict the appellant on the ground of sub-letting of the
rooms. The Courts below held that the appellant had also
sublet several counters, show-cases and garages to various
persons. We express no opinion on the question whether
there was any sub-letting of the counters, show-cases and
garages. The sublettings of the rooms are sufficient
grounds of eviction tinder cls. (b) and (c) of the proviso
to s. 13(1).
Clause 2(v) of the head lease granted by the Government to
the respondent provided that the respondent would not,
without the previous consent in writing of the Chief
Commissioner.. Delhi or a duly authorised officer, erect or
suffer to be erected on any part of the demised premises any
building other than the buildings erected there on the date
of the lease. The appellant had due notice of the
conditions of the head lease. Notwithstanding such previous
notice, the appellant dealt with the premises in a manner
contrary to the conditions imposed by cl. 2 (v). The Courts
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below found that contrary to this condition, the appellant
made several unauthorised constructions without obtaining
the requisite consent. To give one illustration, the
appellant admittedly constructed a room 16 ft. 6 in X 19 ft.
6 in. with R.C.C. slab and brick masonry walls. This newly
constructed room was -let to Shanti Vijay and Co. On the
ground of unauthorised construction of this room alone it
must-be held that the appellant in contravention of cl. (k)
of the proviso to s. 13 (1), notwithstanding previous
notice, dealt with the premises in a manner contrary to
(1) (1907) 11 C.W.N. 848, 852.
558
a condition imposed on the respondent by the Government
while ,giving him a lease of the land on which the premises
are situated. The notice of the conditions imposed by the
head lease was sufficient notice for the purposes of cl.
(k). The ground of eviction under cl. (k) was thus made
out. The Courts below also held that the appellant caused
substantial damage to the premises. We express no opinion
on it, and this question is left open.
It follows that the respondent is entitled to evict the
appellant on the grounds mentioned in cls. (b) (i), (c) (i)
and (k) of the proviso to s. 13(1).
In the result, the appeal is dismissed with costs. The
execution of the decree is stayed for a period of six months
from today. The appellant through Mr. A. K. Sen gives an
undertaking that the appellant will hand over to the
respondent, on the expiry of six months, vacant possession
of the entire hotel premises except the portion in the
possession of sub-lessees.
Y.P. Appeal
dismissed.
559