### Use of Landlord’s Machinery by Tenant Does Not Constitute a Composite Lease Exempt from Rent Control Acts

The respondent, a charitable organization aiding children with deformities, owned a premises where it ran a workshop until 1969.

The revision petitioner (tenant) was inducted into the premises at a nominal rent to manufacture and sell orthopedic aids.

The respondent filed for eviction under the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 (the "Act"), seeking the premises for its own use to start sheltered workshops for mentally and physically challenged persons.

The Rent Controller and the Appellate Authority (R.C.A.No.68 of 2024) concurrently ordered eviction.

The tenant challenged these orders, arguing that the lease was "composite" (including building and machinery) and thus exempt from the Act, and that the respondent lacked bona fides.

1. Whether the lease was a "composite lease" involving both the building and machinery as a going concern, thereby ousting the jurisdiction of the Rent Control Act.

2. Whether the respondent's requirement for the premises was bona fide under Section 10(3)(b) of the Act.

3. Whether the petition was maintainable under Section 10(3)(b) given the respondent occupied other portions of the same building, or if it should have been filed under Section 10(3)(c).

The court applied the provisions of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960, specifically Section 10(3)(b), which allows a landlord (being a religious, charitable, educational, or other public institution) to seek possession of a building for its own use if it is required for the purposes of the institution.

The court also applied the legal principle distinguishing a simple lease from a composite lease, noting that for a lease to be composite and exempt from the Act, it must involve the leasing of a business as a "going concern" rather than just a building where some machinery might be present.

The Court rejected the "composite lease" argument, finding that although the respondent had previously run a workshop there, the building was let out to the petitioner at his request to start his own manufacturing activity; it was not leased as a functioning "going concern" business.

Even if some machinery remained, it did not change the character of the lease of the building.

Regarding bona fides, the Court held that the landlord is the best judge of their own requirement and the tenant cannot dictate which portion of a property is more suitable for the landlord’s expansion.

Finally, the Court dismissed the technical objection regarding the choice between Section 10(3)(b) and 10(3)(c), noting that this plea was at no point raised in the lower courts or the grounds of revision, appearing only in the final written submissions.

The Court held that the lease was not composite, the RCOP was maintainable, and the respondent’s need was bona fide.

The petitioner was ordered to vacate and hand over possession by 30.04.2026.

No costs were awarded.