Hans Raj vs A.N. Gulati
1996 Latest Caselaw 686 Del

JUDGMENT

J.K. Mehra, J.

(1) This is a petition filed by the land- lords/petitioners against the order dated 2.9.94 passed by the Additional Rent Controller, Delhi upholding the objection of the tenant filed after the expiry of the term of limited tenancy granted by the Additional Rent Controller under Section 21 of the Delhi Rent Control Act and dismissing the petition of the petitioners for the recovery of possession by holding that the permission granted under Section 21 of the Delhi Rent Control Act as void.

(2) The facts of the case, in brief, are as under:-

(3) It is alleged by the petitioners that the petitioners are the owners of the property bearing No.C-204A Greater Kailash Part I, New Delhi. The petitioners have been staying at Thailand for the last few years. The elder brother of the petitioners, who is otherwise attorney of the petitioners, had been living in the said house and on account of his having built his own house, he shifted to his house in Malviya Nagar, New Delhi making the demised premises available for letting out. It is alleged by the petitioners that the respondent approached .the petitioners for letting out the property to him for a period of five years under the provisions of Section 21 of the Delhi Rent Control Act. Accordingly, permission under section 21 of the said Act was granted for a period of five years which was valid upto 2nd May, 1983. It is alleged by the petitioners that when asked to vacate the premises on the expiry of the period of five years, the respondent did not vacate the premises in dispute, resulting in the petitioners filing the petition for possession on 14.7.1983 seeking eviction of the respondent and recovery of the possession of the premises in dispute.

(4) Instead of vacating the premises situated on the first floor of C-204/A, Greater Kailash-I, New Delhi, the respondent opposed the said execution and filed the objections on the grounds that the permission under section 21 of the Act was illegal and the petitioners committed a fraud by concealing material facts and intentions to let out the property for a limited period only. The respondent controverted the contentions raised by the petitioners in the execution petition. The respondent contended that he had been living in the property since 1970 alongwith his family and has been paying rent to the petitioners by means of cheque, cash through Mr. Chela Ram, brother of petitioner No. 1 and Attorney of petitioner No.2. The respondent further contended that the petitioners threatened the respondent that they will forcibly evict him and throw him on the road and in these compelling circumstances, the respondent agreed to have the property on rent under the provisions of Section 21 of the Delhi Rent Control Act. He has further contended that since he never vacated the property, the provisions of Section 21 of the Act were not attracted. The respondent has further alleged that since the petitioners are residing in Thailand, they do not require the suit property. In reply to the objections, the petitioners have denied the allegations of facts and have contended that there was no need to disclose the reasons except that the property was not required for a particular period. It is further alleged by the petitioners that their children have studied in India and they will be settled in Delhi only, though they themselves are residing in Thailand.

(5) I have heard the counsel for the petitioner at length. There was no appearance for the respondent despite the case remaining on board as part heard on a number of days. This appears to be yet another case coming to light where the parties enter into a tenancy for a limited term after obtaining permission of Rent Controller under Section 21 of the Act and not vacating the premises on the expiry of such term. The tenant after enjoying full terms of lease without any protest or demur chose to file objections only after the expiry of the term of lease/tenancy on the landlord moving the court for possession in terms of the provisions of Section 21 of the Delhi Rent Control Act. The action of the tenant prima facie appears to be an afterthought and only an excuse to not vacating the premises which he was obliged to vacate.

(6) The respondent in the present case took the premises on rent in terms of the permission of the Additional Rent Controller under the provisions of Section 21 of the Act. He never raised any objection to the creation of lease for a limited period or to the manner of creation of such tenancy or that the permission was vitiated by fraud. When the tenant did not vacate the premises on the expiry of the limited term the landlord moved the Additional Rent Controller for recovery of possession. It was in response to the landlord's petition and in those proceedings that the tenant for the first time raised various objections to vacate the premises. There is no allegation that he was not aware of the alleged fraud at the time of creation of the lease or at any time during the term of the lease.

(7) The objections, inter-alia, include the challenge to the validity of the permission on the ground that at the time of grant of permission "the tenant was already in possession of property". The landlord has contended that the tenant could not raise any such plea after the lapse of the term of lease and only as a defense in the collateral proceedings for the recovery of possession. This controversy and the points arising therein stand settled by the pronouncements of the Hon'ble Supreme Court in various cases including the case of Pankaj Bhargava & another Vs. Mohinder Nath and another, wherein the Hon'ble Supreme Court examined the position in the light of various pronouncements. In the case of S.B. Noronha Vs. Prem Kumar Khanna, , the tenant was permitted to challenge the validity of permission even after the expiry of the term of lease. But that position has substantially been denuded by the subsequent decision of the Hon'ble Supreme Court as held in Pankaj Bhargava's case. In that case, the Hon'ble Court reiterated the view in the case of R. Vohra Vs. Indian Export House Pvt. Ltd., , which reads as under:- "WHAT then is the remedy available to .the tenant in a case where there was in fact mere ritualistic observance of the procedure while granting permission for the creation of a limited tenancy or where such permission was procured by fraud practised by the landlord or was a result of collusion between the strong and the weak? Must the tenant in such cases' be unceremoniously evicted without his plea being inquired into? The answer is obviously in the negative. At the same time must he be permitted to protract the delivery of possession of the leased premises to the landlord on a false plea of fraud or collusion or that there was a mechanical grant of permission and thus defeat the very subject of the special procedure provided for the benefit of the landlord in S.21 The answer must again be in the negative..."

(8) The manner in which the Court harmonised and reconciled these competing and conflicting claims and interests was by insisting upon the tenant to approach the Rent Controller for adjudication of his pleas as soon as he discovered that the initial grant of permission stood vitiated. This was evolved as a part of policy of law for the reconciliation of divergent and competing claims. It was held: "...INour view these two competing claims must be harmonised .. by insisting upon his approach the Rent Controller during the currency of the limited tenancy for adjudication of his pleas no sooner he discovers facts and circumstances that tend to vitiate ab initio the initial grant of permission. Either it is a mechanical grant of permission or it is procured by fraud practised by the landlord or it is the result of collusion between two unequals but in each case there is no reason for the tenant to wait till the landlord makes his application for recovery of possession after the expiry of the fixed period under S.21 but there is every reason why the tenant should make an immediate approach to the Rent Controller to have his pleas adjudicated by him as soon as facts and circumstances giving rise to such pleas came to his knowledge or are discovered by him with due diligence..."

(9) The above view has since been reiterated in the cases of Shiv Chandra Kapoor, and that Yamuna Mallas, . On the challenge in collateral challenge in the proceedings for possession, the Hon'ble Supreme Court laid down in Pankaj Bhargava's case(supra) at page 1240 as under:- "Suffice it to say that in a collateral challenge the exercise is not the invalidation of a decision, but only to ascertain whether the decision "exists" in law at all and to rely upon incidents and effect of its "nonexistence". The authority of decided cases is to the effect that the permission granted must be presumed to be valid till set aside. Doctrine of collateral challenge will not apply to a decision which is valid ex-hypothesi and which has some presumptive existence, validity and effect in law. Such a decision can be invalidated by the right person in right proceedings brought at the right time. It is only a nullity stemming from lack of inherent jurisdiction or a proceeding that wears the brand of invalidity on its forehead that might afford a defense even against enforcement. Shri Sachar is right in his contention that such a collateral challenge may not be available where there is no lack of inherent jurisdiction but what is disputed is only the existence or non-existence of facts which though collateral to the merits do require investigation into and adjudication upon their existence or non existence on the basis of evidence. If the parties before the Rent Controller have admitted that the fact or the event which gives the Controller jurisdiction is in existence and there was no reason for the Controller to doubt the bonafides of that admission as to a fact or event, the Controller is under no obligation to make further enquiries on his own as to -that factual state. The test of jurisdiction over the subject matter is whether the Court or Tribunal can decide the case at all and not whether the Court has authority to issue a particular kind of order in the course of deciding the case."

(10) In Dhanwanti Vs. D.D. Gupta, reported as Air 1986 Sc, the permission to grant limited tenancy more than once successively was held to be not vitiated.

(11) This controversy has been set at rest by a further decision of Hon'ble Supreme Court in the case of Shrisht Dhawan Vs. M/s Shah Brothers, wherein the Hon'ble Supreme Court after noticing its various decisions has laid as follows:- "(1) Permission granted under section 21 of the Act can be assailed by the tenant only if it can be established that it was vitiated by fraud or collusion or jurisdictional' error which in context of Section 21 is nothing else except fraud and collusion. (2) Fraud or collusion must relate to the date when permission was granted. (3) Permission carries a presumption of correctness which can be permitted to be challenged not only by raising objection but proving it prima facie to the satisfaction of Controller before landlord is called upon to file reply or enter into evidence. (4) No fishing or roving inquiry should be permitted at the stage of execution. (5) A permission does not suffer from any of these errors merely because no reason was disclosed in the application at the time of creation of short term tenancy, (6) Availability of sufficient accommodation either at the time of grant of permission or at the stage of execution is not a relevant factor for deciding validity of permission." From the above law summed up by the Hon'ble Supreme Court, the following four principles emerge:- Firstly, any objection to the validity of sanction should be raised prior to the expiry of the lease. 344 Secondly, any objection of fraud of collusion etc. should be made immediately on becoming aware of it. Thirdly, a tenant may be permitted to raise the objection after the expiry of the lease only in exceptional cases. And lastly, the burden to prove fraud, collision is on the person alleging it.

(12) In the light of the above settled law, the respondent in the present case cannot raise the question as to the validity of the permission as he has already enjoyed the premises for complete five years and only after the expiry of the lease, when the landlord asked him to vacate has raised the question, he was aware of all the questions arising from such tenancies and it was within his knowledge that the premises were given for a limited period. The present proceedings are not for the grant of permission to create a tenancy, but are for the execution of the tenancy agreement and the tenancy has expired.

(13) The objection as to the validity of sanction can be allowed to be raised after the expiry of the lease only in exceptional circumstances which means the Rent Controller must find existence of exceptional circumstance. There is no finding of exceptional circumstance in the present case which would permit the tenant to raise any such objection nor such plea is raised nor is anything shown to me which could go to show that the tenant was not aware of the alleged fraud. The terms on which the premises were let out were signed by the tenant on the proposed agreement which was annexed to the application under Section 21 of the Delhi Rent Control Act. Further the tenant has not raised such objections by a substantive petition, but has done so collaterally in the proceedings for recovery of possession. He had all the time available to him during the term of limited tenancy to raise the objection and challenge the order of the Rent Controller granting the application under Section 21.

(14) In view of the facts and circumstances of the present case, the question relating to fraud can also not be looked into as the tenant was already aware of all the facts alleged in his objections. The tenancy is for a limited period of five years and it was with his consent and agreement that the tenancy was created. Secondly, the alleged fraud has to relate to the date when permission was granted. The alleged ground of challenge that he was in occupation of the premises at the time of grant of permission under section 21 is not something of which he was unaware earlier. The court below has not returned any finding of existence of any exceptional circumstance which prevented tenant from coming to court during the term of lease and challenging the grant of permission to create limited tenancy.

(15) This question had repeatedly arisen in the past and it was for that reason that the Hon'ble Supreme Court had to lay down the law clearly -

(16) In S.B. Chatterjee Vs. Meena Ahuja, S.A.O.No.17 of 1988,I had dealt with somewhat similar situation in the case and following the ratio of Shrisht Dhawan's case, had held as under:- "The only exceptional circumstances in which a tenant may be permitted to raise objection after the expiry of such lease could be where the tenant became aware of the fraud subsequent to the expiry of the lease. No such plea is raised nor is anything shown to me which would go to show that the respondent was not aware of the importance of her statement before the court or the terms at which the premises were let out because she has herself signed on the proposed agreement which was annexed to the application under Section 21 of the Drc Act nor has the respondent succeeded in showing as to how the sanction was not validly given. In any event if she did not believe what she stated in court to be true, she had all the time available to her during the term of limited tenancy to raise the objection and challenge the order of the Rent Controller granting the application under Section 21 of the D.R.C. Act. The plea is clearly an afterthought and mala fide and warrants outright rejection. In my opinion, both the courts below have erred in not noticing the impact of the delay in filing the objections and in permitting such lengthy evidence being led."

(17) To the same effect is a subsequent judgment of this court (Arun Kumar, J.) in the case of Swam Kanta Mehra Vs. Vinay K. Nahendra .

(18) In the light of the facts of this case, in my view the present case does not qualify as an exceptional case for the reason that the respondent was aware of all the facts and circumstances under which the tenancy under section 21 of the Act was created. I find that no case for entertainment of the objections by way of collateral challenge in landlord's petition for possession was made out. The objections appear to be in the nature of an afterthought, lacking in bona fides and were filed very much beyond the period of limited tenancy created.

(19) It is very unfortunate that a party who should have got possession in May 1983 had to fight on for more than 13 years to recover the possession and unscrupulous tenant was successful in evading delivery of possession in accordance with the terms of the limited tenancy and the sanction of the Rent Controller. The objection is clearly an after through and malafide and warrants outright rejection. In my opinion, the Court below has erred in not noticing the importance of the delay in filing the objections and in permitting such lengthy evidence being led and in ignoring the fact that the objections were by way of collateral challenge.

(20) For the aforesaid reasons, I am of the opinion that the impugned order cannot be sustained and the same is set aside with costs throughout. The Rent Controller is directed to issue warrants of possession forthwith with authority to the bailiff to break open the locks, if premises are found locked and with further authority that in the event of any resistance, to avail of police help for putting the appellant into possession of the premises in dispute.