Bombay High Court
Municipal Corporation Of Greater ... vs M/S. Green Gold Trading And Investment ... on 6 August, 2024
2024:BHC-AS:31139
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
CIVIL REVISION APPLICATION NO.364 OF 2022
WITH
INTERIM APPLICATION NO.17551 OF 2022
IN
CIVIL REVISION APPLICATION NO.364 OF 2022
Municipal Corporation of Greater Mumbai
a statutory body governed under the
Bombay Municipal Corporation Act
having their address at V.T.
Mumbai - 400 001. ....Applicant
V/S
M/s. Green Gold Trading and
Investment Pvt. Ltd.
A company registered under
Companies Act, having their
address at 26-b Durlabh Bhavan,
Jalbhai Street, Raja Ram Mohan Roy Road,
Mumbai - 400 004. ....Respondent
________
Dr. Ranjit Thorat, Senior Advocate with Ms. Pratibha Shelake, Mr. R.Y.
Sirsikar and Mr. Pradeep Patiil for the Applicant-MCGM.
Mr. Jaydeep S. Deo for Respondent.
__________
CORAM : SANDEEP V. MARNE, J.
RESERVED ON : 31 JULY 2024.
PRONOUNCED ON : 06 AUGUST 2024.
JUDGMENT
1. Applicant-Municipal Corporation of Greater Mumbai (MCGM) has
filed this Civil Revision Application taking exception to the judgment and
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decree dated 11 March 2020 passed by Appellate Bench of Small Causes
Court dismissing Appeal No.366 of 2019 and confirming the decree of the
learned Judge of Small Causes Court passed on 20 August 2019 decreeing
RAE Suit No.569/892 of 2014. The impugned decrees direct Applicant-
MCGM to handover possession of the suit premises to the Plaintiff with
further direction for conduct of enquiry into mesne-profits under Order 20
Rule 12 of the Code of Civil Procedure, 1908 (the Code).
2. Premises bearing Nos.A-3 situated on second floor and B-6
situated on the third floor of the building Malkani Mansion, 284/B,
Gunpowder Road, Reay Road, Mumbai - 400 010 are the suit premises.
The Applicant-MCGM came to be inducted as monthly tenant in respect
of the suit premises, where the Defendant-MCGM was running Urdu
Medium School. According to Plaintiffs, Defendant-MCGM was in arrears
of rent and permitted increases from 1 January 1997. Notice dated 20
February 2013 was served on Defendant-MCGM demanding arrears of
rent and permitted increases and calling upon it to vacate the suit premises.
It appears that Defendant-MCGM did not act on the notice. Plaintiffs
therefore instituted RAE Suit No.569/892 of 2014 seeking eviction of the
Defendant-MCGM on the ground of default. Additionally, Plaintiff also
averred in the plaint that the suit premises were not being used by the
Defendant-MCGM for a period exceeding six months immediately prior to
institution of the suit. Plaintiffs also claimed their bonafide requirement in
receipt of suit premises.
3. The suit was resisted by Defendant-MCGM by filing Written
Statement contending that rent at the rate of Rs.387.57 for the period from
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March 2007 to March 2014 was offered by it but the Plaintiffs refused to
accept the same. That the demand of rent and permitted increases of
Rs.1,769/- was excessive. Defendant-MCGM prayed for fixation of
standard rent and permitted increases in its written statement. Defendant-
MCGM denied the allegation of non-user and contended that the suit
premises were being used for running Urdu Municipal School in the name
and style of 'Mazgaon Municipal Urdu School'.
4. Both sides led evidence in support of their respective claims.
Plaintiff examined its Director Mr. Abdul Aziz Kasam Malkani. Defendant-
MCGM examined Mr. Vinod B. Kadam as its witness. Both sides relied on
documentary evidence. After considering pleadings, oral and documentary
evidence, the Small Causes Court proceeded to decree the suit by its
judgment and order dated 20 August 2019. The Trial Court accepted the
grounds of default in payment of rent, breach of terms and conditions of
tenancy by not paying monthly rent and reasonable and bonafide
requirement of Plaintiffs in respect of the suit premises. The Court also
held that greater hardship would be caused to the Plaintiffs if the decree
was refused. The suit was accordingly decreed directing the Defendant-
MCGM to handover possession of suit premises to the Plaintiffs within
three months. Enquiry into mesne profits under Order 20 Rule 12 of the
Code was also directed to be held.
5. Defendant-MCGM filed Appeal No.366 of 2019 before Appellate
Bench of Small Causes Court. However, by decree dated 11 March 2020,
the Appellate Bench has proceeded to dismiss the Appeal. Aggrieved by
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the decrees passed by the Appellate Bench as well as by the Trial Court,
Defendant-MCGM has filed the present Civil Revision Application.
6. Dr. Ranjit Thorat, the learned senior advocate appearing for
Applicant-MCGM would submit that the Trial Court has erred in
decreeing the suit on the ground of bonafide requirement of Plaintiffs
ignoring the fact that the Defendant-MCGM runs Urdu Medium School
therein. That the ground of bonafide requirement is erroneously accepted
only on the count of Defendant's non-use of the suit premises. That non-
use of the suit premises is forced upon Defendant by Plaintiffs by failing to
perform its obligations under Section 14 to repair and maintain the
building. That a structural audit of the building was conducted in the year
2015, which recommended immediate pulling down of the building. That
since it was dangerous to run school in such dilapidated building,
Defendant-MCGM was left with no alternative but to make a temporary
arrangement by shifting the students in nearby school at Nawab Tank,
Kamgar Sadan BPT Building, Mazgaon, which was already overcrowded
and was handling the burden of two Municipal Schools viz. Nawab Tank
Muncipal Marathi School and Nawab Tank Municipal Urdu School. That
the location at which the children of Mazgaon Municipal Urdu School
were required to be shifted is far off from the suit premises where students
were required to cross the Eastern Free Way, which was not only
inconvenient but also unsafe for the students. That the Trial Court and
Appellate Bench ought to have appreciated that Plaintiffs' own conduct in
neglecting the building forced the Defendant-MCGM to shift the students
to another school and such action on the part of the Defendant-MCGM
cannot be construed to mean either that the suit premises were not being
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used or that the Defendant-MCGM does not need the same. That suit
premises are required for reinstatement of the school and its students at its
original place. He would rely upon letter dated 7 June 2019 addressed by
Administrative Officer (Schools) to the Plaintiffs requesting it to repair the
building so as to reinstate the school in the suit premises. He would submit
that the repairs in the building were actually effected in the year 2018-2019
and in this connection, he would rely upon completion report filed on
record by the Respondent-Company alongwith its Affidavit-in-Reply.
7. So far as the ground of default in payment of rent is concerned, Dr.
Thorat would submit that after receipt of suit summons, application was
filed seeking permission to deposit arrears of rent and after grant of such
permission Defendant-MCGM has paid arrears of rent alongwith interest
and has further continued to pay the same during pendency of the suit. He
would submit that though there is some delay on couple of occasions, the
same cannot be treated as fatal in view of law laid down by the Apex Court
in Mohan Laxman Hede vs. Noormohamed Adam Shaikh1 and by this
Court in Smt. Yeshodabai Baburao Jadhav vs. Jainoddin Nanemiya
Momin2. He would also rely upon judgments of the Apex Court in B.C.
Kame vs. Nemi Chand Jain 3 and Shyamcharan Sharma vs. Dharamdas 4.
8. Per contra, Mr. Jaideep Deo the learned counsel appearing for
Respondent-Plaintiff would oppose the Revision Application submitting
that concurrent findings recorded by the Trial Court and Appellate Bench
do not warrant any interference in revisionary jurisdiction of this Court
1 (1988) 2 SCC 481
2 1993 Bom RC 69
3 AIR 1970 SC 981
4 AIR1980 SC587
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under section 115 of the Code. He would submit that the bonafide
requirement of Plaintiffs has been conclusively established before both the
Courts below. That the entire building is tenanted and he would rely upon
chart at Exhibit R-6 to his Reply to demonstrate presence of several tenants
in the suit premises. He would submit that the Defendants witness
admitted during the course of his deposition that no school activities are
carried out in the suit premises. That the defence of dilapidated condition
of the suit premises is false and taken as an afterthought since not even
single communication was addressed to Plaintiffs requiring it to carry out
any repairs. That this is the case of voluntary shifting of the school by
Defendant, who belatedly addressed letter dated 7 June 2019 to the
Plaintiffs for carrying out repairs in the building.
9. So far as the ground of default is concerned, Mr. Deo would contend
that sub-section (3) of section 15 of the Maharashtra Rent Control Act (the
Act) requires deposit/payment of entire arrears of rent, interest and costs
within a period of 90 days of receipt of suit summons. That the suit
summons was served on the Defendants on 24 June 2014 and the 90 days
period came to an end on 22 February 2014 in which time, such
deposit/payment was not made. Mere filing of application seeking
permission to deposit rent did not mean that the consequences under
section 15(3) of the Act could be prevented. That even qua such
permission granted by the Court, there was considerable delay in deposit of
the rent as the deposit was made for the first time on 5 January 2016. On
subsequent occasions also, there were defaults on the part of the
Defendant in payment of rent. Relying on judgments of the Apex Court in
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Ganpat Ladha vs. Shashikant Vishnu Shinde 5 and Laxman vs. Dr. Vijay
Bhojraj Khachne & Ors.6 , Mr. Deo would contend that the consequences
arising out of failure to deposit/pay arrears of rent under section 15(3) of
the Act are eminent and cannot be saved by even a Court. He would submit
that the ground of arrears of rent is thus correctly accepted by both the
Courts below. Mr. Deo would pray for dismissal of the Civil Revision
Application.
10. Rival contentions of the parties now fall for my consideration.
11. The suit is decreed on twin grounds of bonafide requirement and
default of payment of rent. Both the grounds are discussed separately in the
paragraphs to follow.
12. So far as the ground of bonafide requirement is concerned, Plaintiffs
pleaded its requirement in the Plaint as under:
"8 The plaintiffs state that the plaintiffs require the suit premises for the
plaintiff's multifarious business and commercial activities. The Plaintiffs state
that there are integral component of group of companies known by the name
and style of Aziz Malkani group. The plaintiff state that the plaintiff's director
are Mr. Abdul Aziz Kasam Malkani and Rukhsana Aziz Malkani. The plaintiffs
director Mr. Aziz Malkani is also carrying on business in name of ABM
marketing cell and are carrying on business of supplying food products and food
items, milk products etc. The plaintiffs state that at present there are 40 people
working with ABM marketing cell and are having 30Cr. turn over."
"11 The plaintiffs further state that their another sister concern Nobel
Warehousing and Logistics Pvt. Ltd. are also carrying on business of
warehousing since the year 2005 in which Mr. Abdul Aziz Kasam Malkani, Sana
Aziz Malkani, Naziya A Malkani, Zahid Aziz Malkani: are the directors. The
plaintiffs state that at present there are 8 people working and are having turn
over of 2Cr."
5 1978) 2 SCC 573
6 2022 SCC OnLine Bom 7242
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"12 The plaintiffs further state that the plaintiffs directors and their family
members want to expand their business in ready made garments and as such the
plaintiffs requires the suit premises reasonable and bonafide for their use and
occupation and for their sister concern (Malkani Group). The plaintiffs state
that the plaintiffs said sister concerns are required to handle large contract and
integrated operational systems. All the various companies and entities comprise
the Aziz Malkani are own controlled and managed by Mr. Abdul Aziz Malkani
and Ruksana Aziz Malkani and family members. The plaintiffs further state that
their various companies have common administration amongst them interse and
the personal and employees of the companies constituting the Malkani group
are interchangeable and their functions are inter connected. In the
circumstances the plaintiffs state that their own identity is inseparable and
inseverable from the larger Malkani group to which they belong."
13. For proving cause of comparative hardship to itself, Plaintiffs raised
following pleadings in the Plaint:
"6. The Plaintiff's state that the suit premises has not been used by the
defendants continuously for a period of over more than six months prior to the
filing of the suit for the purpose for which the same was let out to Defendants
without any reasonable cause."
"15. The plaintiffs state as mentioned above are not in effective use and
occupation of the suit premises. The Plaintiffs state that since the Defendants
are not using the suit premises no hardship will be caused to the Defendants.
The Plaintiffs state that if the decree in ejectment is not passed in the favour of
the Plaintiffs then greater hardship will be caused to the Plaintiffs."
14. Thus, Plaintiffs came with a specific case that the
Defendant/MCGM was not using the suit premises. Defendant denied the
allegation of non-use and pleaded in the written statement that the school
premises were being used for running Mazgaon Municipal Urdu School
and sought to rely upon attendance sheet and photographs of students in
the school run in the suit premises. The Trial Court relied upon
documents evidencing non-consumption of electricity from April 2013 to
December 2013. However, perusal of the ledger produced by Defendant-
MCGM indicates that consumption of units in respect of meter No. L0
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96525 was shown as '0' during April 2013 to December 2013. Thereafter
some consumption is reflected from the month of January 2014 onwards.
Similarly in respect of Meter No. C 098155 also, consumption of
substantially lower units is reflected from January 2014 onwards.
Defendant-MCGM was occupying substantially large area admeasuring
2471.20 square feet and it is difficult to believe that if the school was
running full-fledged in the school premises, the consumption of electricity
could be either '0' or substantially low in the range of 200-300 units every
month. In my view therefore, consumption of electricity in the suit
premises clearly shows that operation of regular school in the suit premises
had halted prior to filing of the suit.
15. There is no denial to the fact that the school got shifted to another
premises and at the time when suit was decided, Mazgaon Urdu Medium
School was not being run in the suit premises. Dr. Thorat would accuse
Plaintiffs' conduct for shifting of the school stating that their negligence in
not repairing the building forced the Defendant-MCGM to shift students
to another school. However, there is not even a single letter on record
addressed by Defendant-MCGM to Plaintiff-landlord requiring it to carry
out any repairs in the building. The only letter that appears to have been
addressed by Defendant-MCGM to Plaintiffs is dated 7 June 2019 i.e. two
months before decree of the suit on 20 August 2019. The letter appears to
be general in nature and it appears that similar letters were addressed to
several landlords as the subject of the letter is with regard to 'dilapidated
private buildings in 'E' Ward'. Before 7 June 2019, not even a single
communication was addressed by the Defendant-MCGM complaining
about status of the premises or requesting the landlords to carry out any
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repairs therein. It is therefore difficult to believe that failure on the part of
Plaintiffs to carry out repairs in the suit premises could have been the only
reason for Defendant-MCGM to shift its school. Shifting of school appears
to be a voluntary decision taken by the Defendant-MCGM. Though report
of structural auditor is sought to be relied upon by Dr. Thorat in support of
his contention that the building was in dilapidated condition and was
required to be pulled down immediately on account of its structural
instability, it appears that the building is in perfectly habitable condition as
is evident from photographs placed on record by Respondent/Plaintiffs at
Exhibit R-7 to their Affidavit-in-Reply. It appears that some minor repairs
to the building are carried out in the year 2019 by incurring expenditure of
Rs.16,13,089/-. Curiously the repairs are certified by the Defendant-
Municipal Corporation in its capacity as planning authority. The
photographs show that other tenants are occupying various structures in
the said building. I am therefore unable to accept the defence that the
Defendant- MCGM was forced to shift its school out of suit premises on
account of its dilapidated condition.
16. Plaintiff has pleaded and proved its bonafide requirement. On the
contrary, Defendant-MCGM has admittedly not being using the suit
premises. In that view of the matter, findings relating to Plaintiffs' bonafide
requirement and cause of greater hardship to them recorded by both the
Courts below do not warrant any interference in exercise of revisionary
jurisdiction by this Court.
17. So far as the ground of default in payment of arrears of rent is
concerned, Defendant-MCGM does not seriously contest the position that
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it was irregular in payment of rent. The averment in paragraph 3 of the
Written Statement shows that the rent for the period from March 2007 to
March 2014 was sought to be tendered by the Defendant-MCGM by way
of cheque dated 12 February 2014. After the suit was filed on 5 February
2014 and summons was served on Defendant-MCGM on 24 June 2014, it
had time of 90 days for deposit of arrears of rent, interest @ 15% and costs
of the suit as mandated under section 15(3) of the Maharashtra Rent
Control Act, 1999 (MRC Act), which reads thus:
"15. No ejectment ordinarily to be made if tenant pays or is ready and
willing to pay standard rent and permitted increases
(1) A landlord shall not be entitled to the recovery of possession
of any premises so long as the tenant pays, or is ready and willing to pay,
the amount of the, standard rent and permitted increases, if any, and
observes and performs the other, conditions of the tenancy, in so far as
they are consistent with the provisions of this Act.
(2) No suit for recovery of possession shall be instituted by a
landlord against the tenant on the ground of non-payment of the standard
rent or permitted increases due, until the expiration of ninety days next
after notice in writing of the demand of the standard rent or permitted
increases has been served upon the tenant in the manner provided in
section 106 of the Transfer of Property Act, 1882.
(3) No decree for eviction shall be passed by the court in any
suit for recovery of possession on the ground of arrears of standard rent
permitted increases if, within a period of ninety days from the date of
service of the summons of the suit, the tenant pays or tenders in court the
standard rent and permitted increases then due together with simple
interest on the amount of arrears at fifteen per cent per annum; and
thereafter continues to pay or tenders in court regularly such standard
rent and permitted increases till the suit is finally decided and also pays
cost of the suit as directed by the court.
(4) Pending the disposal of any suit, the court may, out of
amount paid or tendered by the tenant, pay to the landlord such amount
towards the payment of rent or permitted increases due to him as the
court thinks fit."
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18. However before expiry of period of 90 days (by 22 September 2014)
Defendant-MCGM admittedly failed to pay or deposit the arrears of rent,
interest and costs. Instead, it belatedly filed an application seeking
permission for deposit of rent on 25 November 2015. Though the
permission was granted, Defendant-MCGM failed to deposit the rent and
instead filed application dated 15 December 2015 seeking condonation of
delay in deposit of rent. Though the delay was condoned by order dated 15
December 2015 granting second chance for deposit of rent, Defendant-
MCGM failed to pay the same one again and belatedly made first deposit
on 5 January 2016. There is thus long time gap between 22 September 2014
(expiry of period of 90 days from service of suit summons) and 5 January
2016 (date of deposit). It appears that during pendency of the suit also
there was default in payment of rent in respect of the period from
November 2016 to January 2017 and April 2017 to June 2018.
19. Dr. Thorat has contended that so long as deposit of rent is made
with reasonable punctuality, decree for eviction cannot be passed under
section 15(3) of the MRC Act. He has relied upon judgment in Mohan
Laxman Hede (supra), Smt. Yashodabai Baburao Jadhav (supra), B.C.
Kame (supra) and Shyamcharan Sharma (supra). All the judgments seem
to suggest that Courts cannot expect mathematical punctuality in the
matter of deposit of rent and so long as reasonable punctuality is
demonstrated, decree for eviction cannot be passed on the ground of
default. Dr. Thorat has contended that Defendant being a Municipal
Corporation, it cannot be contended that it lacks funds or had no intention
of depositing the rent. However, what needs to be appreciated is the
position that mere ability of Defendant-MCGM to pay rent is not
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important. From its own admission in the written statement, Defendant-
MCGM did not pay rent from 7 long years from 2007 to 2014 and offered
to pay the same only after demand was raised by the Plaintiffs. Rent
ultimately represents return on property owned by the landlord. Though
rent control legislations aim at providing protection to tenants from
increase in rent and from eviction, the protection cannot be overstretched
to make a mockery where the tenant prevents the landlord from enjoying
the rent and later contending that it always had financial capacity to pay the
rent. Payment of timely rent is one of the essential conditions of tenancy
and if there is a default in payment of rent as contemplated under Section
15 of the MRC Act, breach of condition of tenancy gets established.
20. Despite being well aware of provisions of section 15(2) and 15(3) of
the MRC Act, the Defendant-MCGM took the risk of not depositing the
arrears of rent, interest and costs of the suit within a period of 90 days of
date of service of suit summons. Here reliance by Mr. Deo on judgment of
the Apex Court in Ganpat Ladha (supra) appears to be apposite. The Apex
Court has held in paragraph 11 as under:
"11. It is clear to us that the Act interferes with the landlord's right to
property and freedom of contract only for the limited purpose of
protecting tenants from misuse of the landlord's power to evict them, in
these days of scarcity of accommodation, by asserting his superior rights
in property or trying to exploit his position by extracting too high rents
from helpless tenants. The object was not to deprive the landlord
altogether of his rights in property which have also to be respected.
Another object was to make possible eviction of tenants who fail to carry
out their obligation to pay rent to the landlord despite opportunities given
by law in that behalf. Thus Section 12(3)(a) of the Act makes it obligatory
for the Court to pass a decree when its conditions are satisfied as was
pointed out by one of us (Bhagwati. J.) in Ratilal Balabhai Nazar v.
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Ranchhodbhai Shankerbhai Patel, AIR 1968 Guj 172 : (1968) 9 Guj LR 48.
If there is statutory default or neglect on the part of the tenant, whatever
may be its cause, the landlord acquires a right under Section 12(3)(a) to
get a decree for eviction. But where the conditions of Section 12(3)(a) are
not satisfied, there is a further opportunity given to the tenant to protect
himself against eviction. He can comply with the conditions set out in
Section 12(3)(b) and defeat the landlord's claim for eviction. If, however,
he does not fulfil those conditions, he cannot claim the protection of
Section 12(3)(b) and in that event, there being no other protection
available to him, a decree for eviction would have to go against him. It is
difficult to see how by any judicial valour discretion exercisable in favour
of the tenant can be found in Section 12(3)(b) even where the conditions
laid down by it are satisfied to be strictly confined within the limits
prescribed for their operation. We think that Chagla, C.J., was doing
nothing less than legislating in Kalidas Bhavan's case (supra), in
converting the provisions of Section 12(3)(5) into a sort of discretionary
jurisdiction of the Court to relieve tenants from hardship. The decisions
of this Court referred to above, in any case, make the position quite clear
Section 12(3)(b) does not create any discretionary jurisdiction in the
Court. It provides protection to the tenant on certain conditions and these
conditions have to be strictly observed by the tenant who seeks the benefit
of the section. If the statutory provisions do not go far enough to relieve
the hardship of the tenant the remedy lies with the legislature. It is not in
the hands of courts."
(emphasis added)
21 Similarly I have taken a view in Laxman (supra) that failure to
deposit whole rent with interest and costs on first date of hearing of the
suit results in decree for eviction of the tenant.
22 Therefore no serious flaw can be found in the view taken by the Trial
Court and the Appellate Court in upholding the ground of default as well.
Even if the ground of default is to be momentarily ignored, bonafide
requirement of Plaintiffs coupled with non-cause of hardship to the
Defendant-MCGM is clearly established.
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23 I therefore do not find any valid ground to interfere in the concurrent
findings recorded by Small Causes Court and its Appellate Bench. Civil
Revision Application must fail. The same is accordingly dismissed with no
orders as to costs.
24 In view of disposal of the Civil Revision Application, nothing would
survive in the Interim Application and the same is accordingly disposed of.
(SANDEEP V. MARNE, J.)
25 After the judgment is pronounced the learned counsel appearing for
Applicant-MCGM would request for stay of the decree for a period of
eight weeks. The request is opposed by the learned counsel appearing for
Respondent. It is an admitted position that the Applicant-MCGM is not
using the suit premises and the school in question has already been shifted
to another premises.
26 In that view of the matter, it would not be prudent grant stay to the
decree especially considering the fact that there has not been any interim
order in favour of the Applicant-MCGM during pendency of the Revision
Application. The request is accordingly rejected.
(SANDEEP V. MARNE, J.)
SUDARSHAN RAJALINGAM
RAJALINGAM KATKAM
KATKAM Date:
2024.08.06
14:45:48 +0530
