Full Judgment Text
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PETITIONER:
INDER MOHAN LAL
Vs.
RESPONDENT:
RAMESH KHANNA
DATE OF JUDGMENT04/08/1987
BENCH:
MUKHARJI, SABYASACHI (J)
BENCH:
MUKHARJI, SABYASACHI (J)
NATRAJAN, S. (J)
CITATION:
1987 AIR 1986 1987 SCR (3) 765
1987 SCC (4) 1 JT 1987 (3) 246
1987 SCALE (2)196
CITATOR INFO :
F 1987 SC1996 (9,13)
RF 1989 SC 162 (6)
APL 1989 SC 458 (9,11)
R 1990 SC 325 (18)
E 1990 SC1725 (19)
RF 1991 SC1233 (5)
R 1992 SC1555 (2,7,18)
ACT:
Delhi Rent Control Act, 1958: s. 21--Requirements
of--Permission to let out premises for limited
period--Validity of--Reason for landlord’s non-requirement
of premises--Whether to be stated-Agreement in
writing--Whether to be registered.
Practice & Procedure: View taken by the High Court over
a number of years----Should normally be adhered to.
HEADNOTE:
The appellant made an application before the Rent Con-
troller on or about July 15, 1976 to let out the premises to
the respondent for residential purposes for a period of two
years under s. 21 of the Delhi Rent Control Act, 1958 as he
did not require the premises for that period. The respondent
agreed before the Rent Controller to the above statement of
the appellant and undertook to vacate the premises after the
expiry of two years from July 15, 1976. Accordingly, the
Rent Controller made an order allowing creation of a limited
tenancy for a period of two years from July 15, 1976. The
respondent having refused to vacate the premises after two
years, the appellant filed an application under s. 21 on
behalf of himself and his family members claiming possession
of the premises for their bona fide need and use. The Rent
Controller passed an eviction order and the Appellate Tribu-
nal upheld the same.
The High Court allowing the appeal of the tenant-re-
spondent held that the order under s. 21 of the Act was a
mindless order inasmuch as no reason had been stated as to
why the premises in question was not required for a limited
period, that it was not stated as to how the premises in
question was dealt with before creating the said tenancy and
that there was no writing and no lease registered after the
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permission was granted.
Allowing the appeal by special leave,
766
HELD: 1.1 The permission granted by the Rent Controller
under s. 21 of the Delhi Rent Control Act was valid. The
order permitting limited tenancy was not a mindless order
but one passed by him after taking the relevant facts into
consideration. [780D]
1.2 In order to attract s. 21 of the Act, it is necessary
firstly that the landlord must not require the premises
either in whole or part for a particular period; secondly,
the landlord must obtain the permission of the Controller in
the prescribed manner; thirdly, letting of the whole or part
of the premises must be for residence, and fourthly such
letting out must be for such period as may be agreed in
writing. These and these alone are the conditions which are
required to be fulfilled. [772G-773B]
1.3 Section 21 only gives sanction if the landlord makes
a statement to the satisfaction of the Court and the tenant
accepts that the landlord does not require the premises for
a limited period. This statement of the landlord must be
bona fide. The purpose must be residence. There must not be
any fraud or collusion. There is a presumption of regulari-
ty. But it is open in particular facts and circumstances of
the case to prove to the satisfaction of the executing court
that there was collusion or conspiracy between the landlord
and the tenant and the landlord did not mean what he said or
that it was a fraud or that the tenant agreed because he was
wholly unequal to the landlord. [776F-H]
1.4 In the instant case there was no permission previ-
ously. This was the first letting. There was no evidence
that when the landlord stated that he did not require the
premises in question for a particular period, he did not
mean what he said or that he made a false statement. There
was no evidence at any stage that the tenant did not under-
stand what the landlord was stating or that he did not
accept what the landlord stated. There was no evidence that
either the tenant was in collusion or perpetrating any fraud
with the landlord or the tenant was unequal to the landlord
in bargaining powers. There was thus no evidence to show
that the Controller did not apply his mind. [779F, 776H-
777B]
S.B. Noronah v. Prem Kumari Khanna, [1980] 1 S.C.R. 281;
Nagindas Ramdass v. Dalpatram Ichharam, [1974] 2 SCR 544;
V.S. Rahi and another v. Smt. Ram Chambeli, [1984] 2 SCR
290; J.R. Vohra v. India Export House Pvt. Ltd. and another,
[1985] 2 SCR 899 and Smt. Dhanwanti v. D.D. Gupta, [1986] 3
SCC 1, referred to
2. It is not necessary to state under s. 21 the reasons why
the
767
landlord did not require the premises in question for. any
particular period. The landlord or the tenant may be able to
show that cogent reasons did exist or were within the knowl-
edge of the parties as to why the landlord did not require
the whole or a part of his premises for a specified period.
[777BC, 782B]
3. There is no presumption that in all cases the tenants
are the weaker sections. The presumption is, on the con-
trary, in favour of sanction. It is he who challenges the
statement and the admission of the landlord or the tenant
who has to establish facts. In the instant case the onus was
on the tenant to show that the sanction under s. 21 was a
nullity. He did not make any attempt to dislodge the pre-
sumption in favour of the permission. [777C, 779F]
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4.1 An agreement in writing submitted along with the
application under s. 21 of the Act is really a proposed
agreement. It comes into effect only after the grant of
permission. It does not require registration. [782CD]
S.B. Noronah v. Prem Kumari Khanna, [1981] 1 SCR 281,
referred to.
Vijay Kumar Bajaj v. Inder Sain Minocha, [1982] 2 Rent
Control Reporter 392, approved.
4.2 It has been consistently held by the Delhi High
Court that s. 21 is a code by itself, that the order of
permission is itself an authority and that no lease was
necessary. This view has been acted upon for long and trans-
actions have been completed in the Union Territory on the
basis of permission and it was never doubted that there was
any requirement of any lease or any agreement subsequent to
the order and the same required registration. The view taken
by the High Court over a number of years should normally be
adhered to and not to be disturbed. A different view would
not only introduce an element of uncertainty and confusion
but it would also have the effect of unsettling transactions
which might have been entered into on the faith of those
decisions. [780A-C]
Raj Narain Pandey and others v. Sant Prasad Tewari &
others, [1973] 2 SCR 835 and Kasturi Lal v. Shiv Charan Das
Mathur, [1976] 8 Rent Control Reporter 703, referred to.
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 468 of
1987.
768
From the Judgment and Order dated 19.7. 1985 of the
Delhi High Court in Second Appeal No. 374 of 1980.
Madan Bhatia, N.D.B. Raju and Vineet Kumar for the
Appellant.
Dr. L.M. Singhvi, K.B. Rohtagi, Praveen Jain and Baldev
Atreya for the Respondent.
The Judgment of the Court was delivered by
SABYASACHI MUKHARJI, J. This appeal by special leave is
from the judgment and order of the High Court of Delhi dated
19th of July, 1985. The appellant had. made an application
on or about 15th of July, 1976 before the Rent Controller to
let out the premises for a period of two years under section
21 of the Delhi Rent Control Act, 1958 (hereinafter called
’the Rent Act’). The Rent Controller after recording the
statements of the appellant and the respondent made an order
permitting creation of limited tenancy only for a period of
two years for residential purposes to which the respondent
had agreed upon. It may be material to refer to the fact
that the appellant in his application under section 21 of
the Rent Act had stated as follows:
"1 do not require the premises for a
period of two years from 15.7.76. The purpose
of letting shall be residential only and the
premises are shown in the site plan Ex. A-1.
The proposed agreement is Ex. A-2. Limited
tenancy under section 21 of the Act may be
allowed to be created for the said period."
The respondent agreed to the aforesaid
statement and stated as follows:
"I have heard the statement of the petitioner
and I accept it as correct. I have no objec-
tion. I shall vacate the premises after the
expiry of two years from 15.7.76. The purpose
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of letting shall be residential only".
Upon this the Rent Controller passed the
following order:
"This is an application filed under
section 21 of the Act for permission to create
limited tenancy for a period of two years from
15.7.76. The-purpose of letting shall be
769
residential only and the premises is shown in
the site plan Ex. A-1. The proposed agreement
is Ex. A-2. From the perusal of the statements
of the parties I am satisfied that as at
present the petitioner does not require the
premises. Therefore, limited tenancy is al-
lowed to be created for a period of two years
from 15.7.76."
The appellant filed an application on 6th November, 1978
for eviction of the respondent as the respondent had refused
to vacate the premises in spite of his statement made before
the Rent Controller. The appellant filed an application on
the said date under section 21 of the Rent Act on behalf of
himself and his family members claiming possession of the
premises for their bona fide need and use. The appellant
contended that he (the appellant) was a retired official and
was living in a rented house while the respondent was a rich
man doing business in jewellery and was also owning a house
in Delhi. In the application made under section 21 of the
Rent Act the appellant had stated that the appellant owned a
newly built house in the New Friends Colony comprising of
dining, drawing, three bed rooms with attached bath rooms, a
study room, family lounge and a garage. The appellant had
further stated that he did not require the premises for the
personal residence for a period of two years. The appellant
had also stated in that application, that the appellant had
agreed to let it out to the respondent for the first time on
the terms and conditions set out in the proposed lease deed
for a period of two years. It was stated that the respondent
had heard the statement and recorded that he had no objec-
tion and would vacate the premises after expiry of two
years. Subsequently, when the second appeal was pending in
the Delhi High Court, the appellant had filed an application
for early hearing in which he had stated that when the
construction of the house in question was completed the
appellant’s father R.B. Nanak Chand, advocate, was old and
alone (the appellant’s mother had died earlier and other
brother and sister being away from Delhi) and in view of his
father’s ailing health the appellant was living with him in
the rented premises at 4-Flag Staff Road, Delhi to look
after his old and ailing father. It was in those circum-
stances that the appellant had decided to let out the suit
premises for a limited period of two years only. It may be
mentioned that the appellant’s father died two months after
the Rent Controller had granted permission.
The Rent Controller after hearing both the parties on
the 4th of January, 1980 held, rejecting the contention of
the respondent, that section 21 of the Rent Act was not
ultra vires. Furthermore, he was
770
satisfied that a limited tenancy had been created and as
such he granted permission for eviction. Aggrieved by the
aforesaid order the respondent preferred an appeal to the
Rent Control Appellate Tribunal. The Rent Control Appellate
Tribunal upheld the eviction order.
On or about the 19th of July, 1985, being further ag-
grieved, the respondent preferred a second appeal before the
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High Court of Delhi. The High Court of Delhi by the impugned
judgment allowed the appeal on the ground that there was no
ground stated in the application under section 21 of the
Rent Act as to why a limited tenancy was intended to be
made. The High Court held that the order under section 21 of
the Rent Act was a mindless order inasmuch as the respondent
before it had not disclosed as to how the demised premises
were being dealt with before creating the said alleged
tenancy and why the respondent before it did not require the
demised premises for the alleged period of two years and as
to why the same would be required by him after the period of
two years.
The High Court relying on the decision in the case of
S.B. Noronah v. Prem Kumari Khanna, [1980] 1 S.C.R. 281,
held that the order in question in this case was a mindless
order and in that view of the matter the order passed under
section 21 of the Rent Act was not valid. The High Court was
of the view that there was no inquiry for the Controller to
come to the conclusion on the basis of the material that the
premises for which the permission was sought for creating a
limited tenancy was in fact available for being let for a
limited period only and in the absence of that, this was a
mindless order.
The appellant has come up in appeal before this Court
from the said decision.
The question, therefore, that arises for consideration
of this Court is whether in view of the requirements of
section 21 of the Rent Act, was the permission invalid? The
main points upon which the High Court has relied are: first-
ly, on the materials put forward before the Rent Controller
for sanction under section 21 of the Rent Act, no reason had
been stated as to why the premises in question was not
required for a limited period; secondly, it was not stated
as to how the premises in question was dealt with; thirdly,
the High Court was of the view that there was no writing and
no lease registered after the permission was granted. So far
as the second ground, namely, as to how the premises in
question was dealt with prior to the letting out in the
771
instant case the High Court was obviously and factually
incorrect. It was stated in the application for permission
that it was agreed to be let out ’for the first time’ and
secondly, it was stated that the appellant owned ’newly
built house’. Therefore two facts were clearly stated name-
ly, this was a ’newly built’ premises and further that there
was no prior letting. In the aforesaid facts and circum-
stances of the case therefore, it cannot be denied that how
the premises in question was dealt with before the letting
out had been clearly stated.
It is true however, that why the premises in question
was stated by the appellant not to be required for a limited
period had not been ’specifically’ stated at the time of
seeking permission under section 21 by the appellant. The
appellant had stated that he did not require the premises in
question for a period of two years. He had not stated as to
why he did not require the said premises for the said limit-
ed period of two years. The question therefore is was it
necessary to seek a valid order under section 21 to state
that reason and if permission was granted on satisfaction of
the Rent Controller on other conditions without being satis-
fied as to why the landlord did not require the premises in
dispute for a limited period, the order would suffer from
the vice of being a mindless order. Such an order if other-
wise the conditions are satisfied would not be an invalid
order. In order to determine that question it is necessary
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to bear in mind the parameters and the purposes of section
21 of the Rent Act. The Delhi Rent Control Act like other
Rent Control Legislations had been passed to provide for the
control of rent and eviction. The Rent Acts all over the
country came in the Wake of partition and explosion of
population in metropolitan and new urban cities. There are
acute shortages of accommodation. Very often these shortages
and the demand for accommodation led to rack-renting as well
as unreasonable eviction of the tenants. To meet that situa-
tion and to facilitate proper letting the Rent Acts were
passed all over the country ensuring fair return to the
landlords and giving the landlords the right of eviction for
limited purposes and at the same time protecting the tenant
from unreasonable eviction by the landlords. This led to a
series of litigations leading to long delays resulting
specially in metropolitan cities like Delhi, Calcutta and
Bombay in reluctance of many landowners who had vacant
premises for letting out only for limited period either
because of the family conditions or official commitments as
they did not require the premises immediately and at the
same time who were reluctant to part with the said premises
on rent because of the long delay and the procedure that had
to be followed to recover possession of those premises.
772
Section 21 of the Rent Act was an attempt to meet that
reluctance. Section 14 of the Rent Act controls the eviction
of tenants and gives protection to the tenants against
eviction. It stipulates that notwithstanding anything to the
contrary contained in any other law or contract, no order or
decree for the recovery of possession of any premises shall
be made by any court or Controller in favour of the landlord
against a tenant unless certain specified conditions were
fulfilled. Those conditions were laid down in different
sections and provisos thereof. It is not necessary to set
these out in detail. As mentioned hereinbefore that led to a
good deal of reluctance on the part of the landlords to part
with the possession of the premises in their occupation
because of the time and expenses consuming process involved
for recovery of possession. In order, therefore, to induce
reluctant/potential landlords to create tenancies, section
21 was enacted for the benefit of the capital city of Delhi.
This is a new provision-the unique provision made for the
metropolitan city of Delhi. Section 21 of the Rent Act reads
as follows:
"21. Where a landlord does not require the
whole or any part of any premises for a par-
ticular period, and the landlord, after ob-
taining the permission of the Controller in
the prescribed manner, lets the whole of the
premises or part thereof as a residence for
such period as may be agreed to in writing
between the landlord and the tenant and the
tenant does not, on the expiry of the said
period, vacate such premises, then notwith-
standing anything contained in section 14 or
in any other law, the Controller may, on an
application made to him in this behalf by the
landlord within such time as may be pre-
scribed, place the landlord in vacant posses-
sion of the premises or part thereof by evict-
ing the tenant and every other person who may
be in occupation of such premises."
An analysis of this section makes it clear that in order
to attract section 21, the first condition is that the
landlord does not require the whole or part of any premises
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for a particular period. If that condition is fulfilled then
the said landlord after obtaining the permission of the
Controller in the prescribed manner lets the whole of the
premises or part thereof as a residence for such period as
may be agreed to in writing between the landlord and the
tenant and the tenant does not on the expiry of the said
period, vacate such premises, then notwithstanding anything
contained in section 14 or in any other law, the Controller
may, on an application made to him in this behalf by the
landlord
773
within such time as may be prescribed, order the eviction of
the tenant. Therefore the first condition must be that the
landlord must not require the premises either in whole or
part of any premises for a particular period. Secondly, the
landlord must obtain the permission of the Controller in the
prescribed manner. Thirdly, letting of the whole or part of
the premises must be for residence. Fourthly, such letting
out must be for such period as may be agreed in writing.
Therefore, there must be an agreement in writing, there must
be a permission of the Controller for letting out for a
limited period, the landlord must not require the premises
for a particular period and letting of the premises must be
as a residence. These and these alone are the conditions
which are required to be fulfilled.
In Nagindas Ramdass v. Dalpatram Ichharam, [1974] 2 SCR
544,the question was whether a compromise decree for evic-
tion could be passed because the Rent Act enjoined the
eviction only on the satisfaction of the court. The respond-
ent-landlord in that case instituted a suit under the Bombay
Rent Act, 1947 for possession against the tenant on two
grounds, namely, arrears in payment of rent and bona fide
requirement of the premises for personal use and occupation.
A compromise decree was passed.1 When the appellant applied
for execution of the decree the tenant contended that the
compromise decree had been passed by the Rent Court without
satisfying itself as to the existence of grounds of eviction
under the Act and hence being a nullity was not executable.
It was held by this Court that the public policy permeating
this Act was the protection of tenants against unreasonable
eviction. Construing the provisions of sections 12, 13 and
28 of the Act in the light of the said policy, it should be
held that the Rent Court under the Act was not competent to
pass a decree for possession either in invitum or with the
consent of the parties on a ground which was de hors the Act
or ultra vires the Act. The existence of one of the statut-
ory grounds mentioned in sections 12 and 13 was a sine qua
non to the exercise of jurisdiction by the Rent Court. Par-
ties by their consent could not confer jurisdiction on the
Rent Court to do something which, according to the legisla-
tive mandate, it could not do. But if at the time of the
passing of the decree there was some material before the
Court on the basis of which the Court could prima facie be
satisfied about the existence of a statutory ground for
eviction, it would be presumed that the court was so satis-
fied and the decree for eviction,though passed on the basis
of the compromise would be valid. Such material may be in
the form of evidence recorded or produced or it may partly
or wholly be in the shape of express or implied admissions
made in the compromise agreement. Sarkaria, J. speaking for
the
774
Court held that admissions if true and clear were by far the
best proof of the facts admitted especially when these were
judicial admissions admissible under section 58 of the
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Evidence Act. In that case the Court found because of the
admission to pay the arrears of rent and mesne profits at
the ’contractual rate and the withdrawing of his application
for fixation of standard rent, that there was no dispute
with regard to the amount of standard rent and there was an
admission that the rent was in arrears. The Court observed
at pages 552 to 553 of the report as follows:
"From a conspectus of the cases cited
at the bar, the principle that emerges is,
that if at the time of the passing of the
decree, there was some material before the
Court, on the basis of which, the Court could
be prima facie satisfied, about the existence
of a statutory ground for eviction, it will be
presumed that the Court was so satisfied and
the decree for eviction, though apparently
passed on the basis of a compromise, would be
valid. Such material may take the shape either
of evidence recorded or produced in the case,
or, it may partly or wholly be in the shape of
an express or implied admissiOn made in the
compromise agreement, itself. Admissions if
true and clear are by far the best proof of
the facts admitted. Admissions in pleadings or
judicial admissions, admissible under s. 58 of
the Evidence Act, made by the parties or their
agents at or before the hearing of the case,
stand on a higher footing than evidentiary
admissions. The former class of admissions are
fully binding on the party that makes them and
constitute a waiver of proof. They by them-
selves can be made the foundation of the
rights of the parties. On the other hand,
evidentiary admissions which are receivable at
the trial as evidence, are by themselves, not
conclusive. They can be shown to be wrong."
The aforesaid principle must be borne in mind in order
to judge the invalidity of the order passed under section 21
of the Act which was based on the statements made by the
appellant and the respondent. The facts of the case upon
which great deal of reliance was placed by the High Court in
the judgment under appeal and upon which the appellant
relied very heavily are mentioned in the case of S.B. Noro-
nah v. Prem Kumari Khanna (supra). There this Court reiter-
ated that section 21 of the Rent Act carved out a category
for special treatment. While no landlord could evict without
compliance with sections
775
14, 19 and 20 of the Act, a liberal eviction policy could
not be said to under-lie in section 21. The Court observed
that the Parliament was ’presumably keen on maximising
accommodation available for letting, realising the scarcity
crisis. One source of such spare accommodation which is
usually shy is potentially vacant building or part thereof
which the landlord is able to let out for a strictly limited
period provided he had some credible assurance that when he
needed it he would get it back. The law sought to persuade
the owner of the premises available for letting for a par-
ticular period by giving him a special assurance that at the
expiry of that period the appointed agency would place the
landlord in vacant possession. Section 21 confined the
special remedy to letting for residential uses only. Parlia-
ment had the wholesome fear that if the section were not
controlled by many conditions it might open the floodgates
for wholesale circumvention of the rent control legislations
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by ingenious landlords exploiting the agonising need of
houseless denizens.
Section 21 of the Act over-rides section 14 precisely
because it was otherwise hedged in with drastic limitations
and safe guarded itself against landlords’ abuses. The first
condition was that the landlord did not require the demised
premises ’for a particular period’ only. That meant that he
must indicate to the authority before which sanction was
sought for letting what was the particular period for which
he could spare the accommodation. The Controller exercised
an important regulatory function on behalf of the community.
The fact that a landlord and a potential tenant together
apply, setting out the formal ingredients of section 21, did
not relieve the Controller from being vigilant to inquire
and satisfy himself about the requisites of the landlord’s
non-requirement ’for a particular period’ and the letting
itself being ’as a resident’. A fraud on the statute could
not be permitted especially because of the grave mischief
that might be perpetrated in such event.
The Court highlighted that it would be a terrible blow
to the rent control law if section 21 were freely permitted
to subvert the scheme of section 14. Every landlord would
insist on a tenant going through the formal exercise of
section 21, making ideal averments in terms of that section.
The consequence would be that both the Civil Procedure Code
which prescribed suits for recovery of possession and the
Delhi Rent Control Act which prescribed grounds for eviction
would be eclipsed by the pervasive operation of section 21.
Neither grounds for eviction nor suits for eviction would
thereafter be needed, and if the landlord moved the Court
for a mere warrant to place the landlord, through the Court
process, in vacant possession of the premises, he
776
would get it. No court-fee, no decree, no execution peti-
tion, no termination of tenancy-wish for possession and the
Court was at your command. The Court observed that such a
horrendous situation would be the negation of the rule of
law in this area.
When the application under Section 21 is filed by the
landlord and/or tenant the Controller must satisfy himself
by such inquiry as he may make, about the compulsive re-
quirements of that provision. If he makes a mindless order,
the Court. when challenged at the time of execution will go
into the question as to whether the twin conditions for
sanction have really been fulfilled. Of course, there will
be a presumption in favour of the sanction being regular,
but it will still be open to a party to make out his case
that in fact and in truth the conditions which make for a
valid sanction were not present.
The sanction granted under section 21, if it has been
procured by fraud and collusion cannot withstand invalidity
because, otherwise, high public policy will be given as
hostage to successful collusion. The doctrine of estoppel
cannot be invoked to render valid a proceeding which the
legislature, has on grounds, of public policy subjected to
mandatory conditions which are shown to be absent. As be-
tween unequals the law steps in and as against statutes
there is no estoppel, especially where collusion and fraud
are made out and high purpose is involved.
Law that non-performs stultifies the rule of law and
hence the need for strict compliance. Or else, the sanction
is non-est. Collusion between the strong and the weak cannot
confer validity where the mandatory prescriptions of the law
are breached or betrayed.
An analysis of this judgment which has been applied in
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the various cases would indicate that section 21 only gives
sanction if the landlord makes a statement to the satisfac-
tion of the court and the tenant accepts that the landlord
does not require the premises for a limited period; this
statement of the landlord must be bona fide. The purpose
must be residence. There must not be any fraud or collusion.
There is a presumption of regularity. But it is open in
particular facts and circumstances of the case to prove to
the satisfaction of the executing court that there was
collusion or conspiracy between the landlord and the tenant
and the landlord did not mean what he said or that it was a
fraud or that the tenant agreed because the tenant was
wholly unequal to the landlord. In the instant case none of
these conditions were fulfilled. There is no evidence in
this case that when the landlord
777
stated that he did not require the premises in question for
a particular period, he did not mean what he stated or that
he made a false statement. There was no evidence in this
case at any stage that the tenant did not understand what
the landlord was stating or that he did not accept what the
landlord stated. There was no evidence that either the
tenant was in collusion or perpetrating any fraud with the
landlord or the tenant was unequal to the landlord in bar-
gaining powers. It is manifest that there is no evidence to
show that the Controller did not apply his mind. If that is
so then on the principle enunciated by this Court in Noro-
nah’s case, this sanction cannot be challenged. It is not
necessary to state under section 21 the reasons why the
landlord did not require the premises in question for any
particular period. Nor is there any presumption that in all
cases the tenants are the weaker sections. The presumption
is, on the contrary, in favour of sanction, it is he who
challenges-the statement and the admission of. the landlord
or the tenant who has to establish facts as indicated in
Nagindas’s case.
In V.S. Rahi and another v. Smt. Ram Chambeli, [1984] 2
SCR 290, this Court on the facts found that the permission
under section 21 of the Act had been obtained by her on the
basis of wrong statement, but for which the permission would
not have been accorded. These statements which were in the
nature of half truths were apparently made in order to make
good the plea that there was only a temporary necessity to
lease out the building for a short period and that there was
a bona fide anticipation that there would be a pressing
necessity to reoccupy the premises at the end of the period.
which were the two crucial factors governing an order under
section 21 of the Act. It was stated that the appellants, in
that case, who were the weaker of the two parties did not
question the truth of the statements made by the respondent
,when the permission was granted. But such collusion, if
any, between the two unequal parties did not confer any
sanctity on the transaction in question. The observations of
this Court in that case must be understood in the light of
the facts mentioned by this Court. It was found in Rahi’s
case that there were wrong statements made by the appellant
when he approached the Rent Controller. It was admitted
before this Court that it was a wrong statement. These were
mentioned in pages 295-296 of the Report. What was urged was
that the appellants being the tenants had colluded with the
respondent. It was reiterated by this Court, it is always
open to the weaker of the two parties to establish that the
transaction was only a camouflage used to cover its true
nature. When one party could dominate over the will of the
other, it would not be a case of collusion but one of com-
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pulsion. The Court relied on the observations of Lord Ellen
borough in Smith v. Cuff,
778
[1817] 6 M & S 160 at 165 that it can never be predicted as
pari delicto where one holds the rod and the other bows to
it. See the observations of this Court at pages 297 and 298
of the Report. There is no evidence in this case that there
was any wrong or incorrect statement made by the landlord
nor is there any evidence that the tenant-respondent herein
was the weaker side of the bargain. In that view of the
matter the respondent cannot get much assistance from this
decision of this Court.
This question was again considered by this Court in J.B.
Vohra v. India Export House Pvt. Ltd. and another, [1985] 2
S.C.R. 899 where Tulzapurkar, J. referring to Noronah’s case
observed that section 21 carved out tenancies of particular
category for special treatment and provided a special proce-
dure that would ensure to the landlord vacant possession of
the leased premises forthwith at the expiry of the fixed
period of tenancy, evicting whoever be in actual possession.
Such being the avowed object of prescribing the special
procedure, service of a prior notice on the tenant upon
receipt of the landlord’s application for recovery of pos-
session and inviting his objections followed by an elaborate
inquiry in which evidence might have to be recorded would
really frustrate that object. It will be vitiated because it
is procured by fraud practised by landlord for creating a
limited tenancy. If it is found that the initial order
granting permission to create limited tenancy was vitiated
by fraud practised by the appellant inasmuch as he had
suppressed the fact that an earlier application for such
permission had been declined on the ground that premises had
been let out for commercial-cum-residential purposes and
then there would be no executable order pursuant to which
any warrant for possession could be issued under section 21
of the Act. In the instant case, there is no such collusion
and therefore, the principle of Noronah’s case would not be
applicable. The ratio of that decision must be understood in
its proper light.
Section 21 of the Rent Act was examined by this Court in
Smt. Dhanwanti v. D.D. Gupta, [1986] 3 S.C.C. 1. There was
observed by Pathak, J. as the learned Chief Justice then
was, that it was possible for the owner of a premises, on
looking to the immediate future, to find that for certain
reasons he was unable to occupy the premises forthwith
himself but that he may do so later in the not very distant
future. The mere fact that the owner has let out the prem-
ises after obtaining permission under section 21 of the Act
for a limited period, and thereafter on the expiry of that
period has found it necessary to obtain permission to let
out the premises again for another limited
779
period cannot necessarily lead to the inference that from
the very beginning the premises were available for letting
out indefinitely. The Rent Controller and the Rent Control
Tribunal should have examined the circumstances prevailing
on each occasion when an application was made under section
21. It was observed that assumption would not be justified
where there is no positive material to indicate’ that from
the very beginning there was never any intention on the part
of the landlord to occupy the premises himself. There was no
such material in that case. On the contrary there was mate-
rial showing that the landlady had expectation that her son
and his family would be in Delhi after two years’ period of
tenancy. This is significant for the present issue. There is
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nothing to show that the permission of the Rent Controller
Was obtained by practising fraud or that it could be regard-
ed as a nullity or that material facts were concealed. The
principle of that decision will apply much more in this
case. It is observed in that decision that it seems to have
been ignored altogether that it is perfectly possible for
the owner of a premises, on looking to the immediate future,
to find that for certain reasons, he is unable to occupy the
premises forthwith himself but that he may do so later in
the not very distant future. It is not always that a man can
plan his life ahead with any degree of definiteness. Pre-
vailing uncertainty in the circumstances surrounding him may
not permit clear-sighted vision into the future. The circum-
stances might justify his envisioning his need for the
premises two or three years later, and therefore applying
for permission under section 21 of the Act to let out the
premises accordingly.
The facts are more stronger and clearer in support of
the instant case. Here there was no permission previously.
This was first letting out. There was nothing which indicat-
ed that any statement was made which was incorrect. We are
of the opinion that sanction under section 21 in the instant
case was not a nullity. The onus was on the tenant to show
that it was so. He did not make any attempt to dislodge the
presumption in favour of the permission.
Learned counsel for the appellant also stressed before
us that section 21 of the Rent Act was a complete code by
itself. The order was under section 21 of the Rent Act. No
further question of lease or registered lease arose thereaf-
ter.
This question has been settled by series of decisions of
the Delhi High Court upon which people have. acted for long.
See the decision in Kasturi Lal v. Shiv Charan Das Mathur,
[1976] Rent Control Reporter Vol. 8703 where at pages 708-
709, Misra, J. of the Delhi High Court
780
had clearly indicated numerous cases where it was held that
section 21 was a code by itself. The order of the permission
is itself an authority; no lease was necessary and if that
is the state of law in Delhi, it is too late in the day to
hold otherwise. See the observations of this Court in Raj
Narain Pandey and others v. Sant Prasad Tewari & others,
[1973] 2 S.C.R. 835, where this Court observed that in the
matter of the interpretation of a local statute, the view
taken by the High Court over a number of years should nor-
mally be adhered to and not to be disturbed. A different
view would not only introduce an element of uncertainly and
confusion but it would also have the effect of unsettling
transactions which might have been entered into on the faith
of those decisions. In Delhi transactions have been complet-
ed on the basis of permission and it was never doubted that
there was any requirement of any lease or any agreement
subsequent to the order and the same required registration.
It must be observed that in Noronah’s case there was no
admission on oath nor was there any question of registered
lease.
Numerous other decisions were cited before us but in the
view we have taken on the two basic points that the permis-
sion was valid and the order permitting limited tenancy was
not a mindless order but one passed after application of the
mind taking the two relevant facts under section 21 of the
Act into consideration, it is not necessary to discuss these
decisions any further. In view of the fact that section 21
is a code by itself, there was no question of any further
agreement in writing which has to be registered arises.
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There is no merit in the contention of the respondent.
There is another aspect of the matter which has to be
borne in mind. The tenant not only failed to establish any
fact impeaching the order, he waited for the full term to
take this point and did not contest when the permission was
obtained on a misrepresentation.
It was submitted by Shri Bhatia that in Delhi most of
the transactions have been done under section 21 on the
assumption that after order of the court no further or
separate document or lease was required to be executed or
that such document or lease had to be registered. It was
submitted that numerous transactions have taken place on
that basis. It was urged that if it is now found that is not
the correct position and the correct position in law is that
there should be a lease containing the terms of the lease
being for 11 months, such enunciation of law should only be
made applicable prospectively. Counsel for the appellant
contended that otherwise it would have disastrous conse-
781
quences of unsettling numerous decisions and unsettling many
settled transactions between the parties. He drew our atten-
tion to the decision of this Court in 1. C. Golak Nath &
others v. State of Punjab and another, [1967] 2 S.C.R. 762.
If we had any doubt on the scope and ambit of section 21, we
might have considered this submission urged on behalf of the
appellant provided we were sure, factually that large number
of transactions had been completed on the assumption that no
further lease was required after the permission under sec-
tion 21. Our attention was also drawn to the decision of the
Privy Council and the observation of Lord Blanesburgh in the
case of Dhanna Mal and others v. Rai Bahadur Lala Moti
Sagar, A.I.R. 1927 Privy Council 102. If we were inclined to
the view that section 21 was not a code by itself but re-
quired separate lease to follow it up then perhaps we might
have considered the effect of the aforesaid decision and
observations.
In aid of the submission that in order to be entitled to
eviction under section 14 of the Rent Act, the court had to
be satisfied itself that the statutory ground for eviction
existed and that application of satisfaction of the court
could not be by-passed and circumvented by a compromise
decree, reliance was placed on certain observations on a
decision in Ferozi Lal Jain v. Man Mal and another, [1970] 3
S.C.C. 181. In view of the facts of the particular case, we
are of the opinion that it is not necessary to discuss the
said decision in detail. Numerous decisions of the Delhi
High Court were placed before us in support of or in respect
of contentions of the parties specially in support of con-
tention that the Delhi Rent Act required a separate lease.
The scope and ambit of the Delhi Rent Act after the decision
of Noronah’s case came up for consideration before a divi-
sion bench of the Delhi High Court in Vijay Kumar Bajaj v.
Inder Sain Minocha, [1982] 2 Rent Control Reporter 392. In
that decision, in the light of section 21, the following
questions were posed:
(1) Whether the permission under section 21 of the Act
is invalid in view of Supreme Court judgment in S.B. Noro-
nah’s case (supra), if reasons for not requiring the prem-
ises by the landlord for a particular period are not dis-
closed in his application or his statement before the Con-
troller?
(2) Whether before or after permission execution of any
agreement in writing to let the premises for the fixed
period is necessary, if so, whether such a document requires
registration?
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(3) Whether the proposed agreement of tenancy in writing
sub-
782
mitted along with the application under Section 21 of the
Act, in this appeal required registration?
The questions were answered by the High Court as follows:
(1) Not necessarily. The landlord or the tenant may be
able to show that cogent reasons did exist or were within
the knowledge of the parties as to why the landlord did not
require the whole or a part of his premises for a specified
period.
(2) No registration is necessary. The agreement in
writing may be entered into either before or after grant of
permission.
(3) An agreement in writing submitted along with the
application under section 21 of the Act is really a proposed
agreement. It comes into effect only after the grant of
permission under section 21 of the Act. It does not require
registration.
We are in agreement with the views of the Delhi High Court.
Large number of decisions of this Court were cited in
support of the contention that eviction decree passed in
contravention of the statutory conditions or passed without
consideration whether the statutory conditions are fulfilled
or not are not binding and cannot be enforced. See Bahadur
Singh and another v. Muni Subrat Dass and another, [1969] 2
S.C.R. 432 and Kaushalya Devi and others v. Shri K.L. Ban-
sal, [1969] 2 S.C.R. 1048.
We are, however, of the opinion that in view of the
facts found in the instant appeal before us, these decisions
are not of any relevance.
Similarly, our attention was drawn to the observations
of this Court in Mansaram v. S.P. Pathak and others, [1984]
1 S.C.R. 139 and State of Maharashtra v. Narsingrao Gangaram
Pimple, [1984] 1 S.C.R. 62 1, In the view we have taken and
the real controversy in this case, this contention is no
longer open.
On the unregistered lease question, our attention was
drawn to a decision of the Delhi High Court in Jagat Taran
Berry v. Sardar Sant Singh, A.I.R. 1980 Delhi 7. As we have
held that section 21 was a code by itself and no further
document was required, it is not necessary to pursue the
matter any further.
783
Similarly, our attention was drawn to a division bench
judgment of the Calcutta High Court in the case of Ram
Abatar Mahato v. Smt. Shanta Bala Dasi and others, A.I.R.
1954 Calcutta 207 on the question of the terms and extent of
section 107 of the Transfer of Property Act and whether a
document in performance of an agreement had to be registered
or not. As mentioned hereinbefore in the view we have taken,
it is not necessary for us to pursue this aspect any further
as to the question whether oral evidence should be intro-
duced to explain the terms of a document embodied in writ-
ing.
Our attention was drawn to certain observations of this
Court in State of Uttar Pradesh v. Singhara Singh and oth-
ers, [19641 4 S.C.R. 485 but the same are not relevant for
our consideration in the present controversy in the light in
which we have understood it. Equally same is the decision in
respect of the observations of Fazal Ali, J. of the Jammu
and Kashmir High Court in Ishwar Dutt and another v. Sunder
Singh and others, A.I.R. [1961] J & K 45 and the observa-
tions of this Court in Sri 5 Sita Maharani and others v.
Chhedi Mahto and others, A.I.R. [1955] S.C. 328.
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In the aforesaid light we are of the opinion that the
High Court was in error in the view it took in setting aside
the decision in the second appeal. The appeal is, therefore,
allowed and the order and judgment of the High Court of
Delhi dated 19th of July, 1985 are set aside and the order
and judgment of Rent Control Tribunal dated 28th of August,
1980 are restored. The appellant is entitled to the costs of
this appeal.
P.S.S. Appeal
allowed.
784