Veera Rai vs S.P. Rao & Ors.
2000 Latest Caselaw 192 Del

ORDER

Madan B. Lokur, J.

1. By this judgment, I propose to decide two appeals filed under the provisions of Section 39 of the Delhi Rent Control Act, 1958 (hereinafter referred to as the Act). These appeals are S.A.O. No. 240/1982 (Veera Rai Vs. S.P. Rao & Ors.) and S.A.O. No. 271/1982 (S.P. Rao Vs. Veera Rai). Both these appeals are directed against the order dated 4th May, 1982 passed by the learned Rent Control Tribunal(hereinafter referred to as the Tribunal) in RCA No. 615/1981 and RCA No. 158/1979.

2. For the sake of convenience, Veera Rai (and those claiming under her) are referred to as the landlord and S.P. Rao (and others claiming under him) are referred to as the tenant.

3. The premises in question (hereinafter referred to as the suit premises) are the first and second floors of 23/90, Connaught Circus, New Delhi. The suit premises are a part of "Madras Hotel", a landmark with which old-timers of Delhi are quite familiar.

4. It appears that sometime in 1938, the suit premises were let out to the father of the tenant. Later, a perpetual lease deed was entered into between the predecessor-in-interest of the landlord and the Government of India on 19th December, 1938. In terms of this perpetual lease deed, the ground floor of the leased property was to be used as a shop and the suit premises were to be used for residential purpose.

5. Clauses 2(5) and 2(6) of the lease deed are material, and they read as follows:

"2(5) The Lessee will not without the pervious consent in writing of the Chief Commissioner of Delhi or of such officer or body as the Lessor or the Chief Commissioner of Delhi may authorise in this behalf make any alterations in or additions to the buildings erected on the said demised premises so as to affect any of the architectural or structural features thereof or erect or suffer to be erected on any part of the said demised premises any buildings other than and except the buildings erected thereon at the date of these presents.

2(6) The Lessee will not carry on or permit to be carried on, on the said premises any business, trade or manufacture which in the opinion of the Chief Commissioner of Delhi, is noisy, noxious or offensive, or permit the said premises to be used for any purpose otherwise than as shops with residence above or do or suffer to be done thereon any act or thing whatsoever which in the opinion of the Chief Commissioner of Delhi may be an annoyance or disturbance to the Governor General in Council or his tenants in the New Capital of Delhi and will not without the prior sanction, of the Chief Commissioner of Delhi use the said premises or permit the said premises to be used for the sale of grains or of articles of food or drink of any kind or description whatsoever."

6. Sometime in 1975, the landlord sought the eviction of the tenant on several grounds and for various reasons. But the dialects of the situation have reduced the objections of the landlord to two main objections. Firstly, that the tenant has raised unauthorised construction on the second floor of the suit premises. Secondly, the tenant has misused the first floor of the suit premises by utilizing the same for commercial purpose, instead of for residential purposes as required by the perpetual lease deed. According to the landlord, the tenant has violated the provisions of Clause (k) of the proviso to Section 14(1) of the Act :

7. Learned counsel for the parties made their submissions on 4th and 8th February, 2000 when judgment was reserved.

8. Clause (k) of the proviso to Section 14(1) of the Act reads as follows:

"14. Protection of tenant against eviction-

(1) 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 or the landlord against a tenant :

Provided that the Controller may, on an application made to him in the prescribed manner, make an order for the recovery of possession of the premises on one or more or the following grounds only, namely:-

(a) to (j) xxx xxx xxx

(k) that the tenant has, notwithstanding previous notice, used or dealt with the premises in a manner contrary to any condition imposed on the landlord by the Government or the Delhi Development Authority or the Municipal Corporation of Delhi while giving him a lease of the land on which the premises are situate;"

9. Section 14(11) of the Act is also of some importance and the same reads as follows:

"14(11) No order for recovery of possession of any premises shall be made on the ground specified in clause(k) of the proviso to sub-section (1), if the tenant, within such time as may be specified in this behalf by the Controller, complies with the condition imposed on the landlord by any of the authorities referred to in that clause or pays to that authority such amount by way of compensation as the Controller may direct."

10. By the large, learned counsel for the parties agree (to the extent that one can expect two opposing counsel to agree) that there are two important decisions of the Supreme Court which would take care of the problem presented by this case.

11. These decisions of the Supreme Court are :

(a) Faqir Chand Vs. Ram Rattan Bhanot, .

(b) Dr. K. Madan Vs. Smt. Krishnawati & Anr., .

12. In Faqir Chand, the question that arose for consideration (paragraph 5 of the Report) was: "Are the landlords estopped or otherwise prohibited from getting possession of the property from the tenants because they themselves had let it out for commercial purpose".

13. Answering the question in the negative, the Supreme Court (in paragraph 10 of the Report) held that :

"The provisions of Clause (k) of the proviso to sub-section (1) of Section 14 is something which has to be given effect to whatever the original contract between the landlord and the tenant.........It would not benefit the tenant even if it is held that the landlord cannot, under the circumstances, evict him. The landlord will lose his property and the tenant also will lose. He cannot, after the Development Authority takes over the building use it for a commercial purpose. We thus reach the conclusion that the lease in its inception was not void nor is the landlord estopped from claiming possession because he himself was a party to the breach of the conditions under which the land was leased to him."

14. It must, therefor, be held on the basis of Faqir Chand, that the landlord is not estopped from maintaining an eviction petition against the tenant even if the suit premises were let out for commercial purposes.

15. Learned counsel for the tenant submitted that at the time when the Supreme Court decided Faqir Chand, there was no Zonal Development Plan framed by the Delhi Development Authority under the provisions of Section 14 of the Delhi Development Act, 1957. He submitted that now there is a Zonal Development Plan and as per this Plan, the area in Connaught Circus is required to be used for commercial purposes. He, therefore, contended that even assuming that running a boarding and lodging house is commercial user, his client is merely acting in conformity with the Zonal Development Plan.

16. I am afraid the learned counsel has, with respect, not correctly appreciated the view expressed by the Supreme Court. In paragraph 13 of the Report, the Supreme Court while dealing with the interpretation of Section 14 of the Delhi Development Act, 1957 also referred to the proviso to that section and this is what the Supreme Court had to say :

"The proviso to that section deals with the use to which a land or building may continue to be put even after the coming into force of the zonal plan subject to such terms and conditions as may be prescribed by regulations, provided that building or land had been used for that purpose prior to the coming into force of the zonal plan. The section, therefore, does not contemplate complete prohibition of the use of a land or building for purposes other than that permitted in the zonal plan. Such uses can be continued subject to erms and conditions prescribed by the regulations provided it had been there even before the zonal plan".

17. It follows, therefore, that the Zonal Development Plan is not the last word on the subject. Premises can be used, contrary to the Zonal Development Plan subject to certain terms and conditions and if the contrary user had been there before the Zonal Development Plan came into force. Consequently, it cannot be suggested, as has been done by learned counsel for the tenant, that after the coming into force of the Zonal Development Plan, the perpetual lease deed becomes irrelevant with regard to the user of the premises.

18. Apart from the above decision of the Supreme Court, reference may also be made to Union of India & Ors. Vs. Dev Raj Gupta & Ors., where the Supreme Court in paragraph 17 of the Report held as follows:

"The High Court is further not right in holding that there was an automatic or a statutory conversion of the user of the land because in the Master Plan the land in question fell in the area reserved for commercial use. The High Court failed to appreciated that the change of user of the land permitted by the Plan was only enabling in nature. It lifted the restriction which was otherwise there for using the land for commercial purpose. The land has to be used as per the agreement between the contracting parties, and no change of the user can be made contrary to the agreement even if the Plan permits such user. The Plan helps the parties to change the user, if the parties mutually agree to do so. It does not permit the occupant to change the user unilaterally."

19. In this view of the matter, it is quite clear that the tenant was bound to use the premises for residential use only, unless otherwise permitted to do so.

20. It must be stated, in all fairness to learned counsel for the tenant, that he raised no contention on the basis of the fact that the suit premises were let out to the tenant even before the perpetual lease deed was executed between the landlord and the Government of India.

21. In the second important decision of the Supreme Court, namely, Dr. K. Madan, the Supreme Court dealt with clause (k) of the proviso to Section 14(1) of the Act as well as Section 14(11) of the Act. The Supreme Court came to the conclusion that where the concerned authority insists that the misuser must cease, then the learned Additional Rent Controller had no authority to pass an order permitting the continued misuser on payment of misuse charges. Consequently, in such a situation not only is the misuser required to be stopped, but misuser charges are also required to be paid as provided for in Section 14(11) of the Act.

22. While coming to this conclusion, the Supreme Court held (in paragraph 19 of the Report) as follows:

"Keeping in view the fact that clause (k) of the proviso to subsec. (1) has been inserted in order that the unauthorised use of the leased premises should come to an end, and also bearing in mind that the continued unauthorised user would give the principal lessor the right of re-entry cancellation of the deed, the aforesaid words occurring in sub-sec. (11) of Sec. 14 cannot be regarded as giving an option to the Controller to direct payment of compensation and to permit the tenant to continue to use the premises in an authorised manner. The prinicipal lessor may, in a given case, be satisfied, in cases of breach of lease to get compensation only and may waive its right of re-entry or cancellation of lease. In such a case the Controller may, instead of ordering eviction under Sec. 14(1)(k) of the Act, direct payment of compensation as demanded by the authorities mentioned in clause (k). Where, however, as in the present case compensation is demanded in respect of condoning/removal the earlier breach, but the authority insists that the misuser must cease then the Controller has no authority to pass an order under Sec. 14(11) or Sec. 14(1)(k) of the Act giving a license or liberty of continued misuser".

23. In the background of this legal position, the question that has to be considered is whether the tenant has misused the premises by running a boarding and lodging house on the first floor of the suit premises. For determining this, it has first to be seen whether the running of a lodging house is equivalent to commercial user.

24. Learned counsel for the tenant placed great reliance upon a judgment of a learned Single Judge of this Court in Shri R. Ramanujam Vs. Shri Ajit Singh Thukral & Ors., 1978 (2) RLR 41. In that decision, this Court expressed the view that running a lodging house would amount to utilising the premises for residential use. While coming to this conclusion, the learned Single Judge relied upon to certain decisions rendered by Court in England.

25. However, by relying upon those very decisions, the Supreme came to an entirely opposite conclusion in A.N. Kapoor Vs. Pushpa Talwar, . In that case, the tenant therein was permitting the premises for being used by foreign students on a paying guest basis. In paragraph 10 of the Report, the Supreme Court concluded that such user took the premises in question out of the ambit of the expression "premises let for residential purposes".

26. It was further held (in paragraph 13 of the Report):

"The evidence on record leaves no doubt that the premises have been regularly used by the appellant as a boarding house and not as a private residence in the ordinary acceptation of the term. She has in fact been carrying on, it the words of Romer, J., "a species of business". See Hobson Vs. Tulloch, 1898 Ch D 424 : 78 LT 224. See also Thorn Vs. Madden, 1925 All ER 321 and Tendler Vs. Sproule, (1947) 1 All ER 193."

27. In view of this decision of the Supreme Court, it is quite clear that the running of a lodging house takes the suit premises out of the purview of residential user.

28. Learned counsel for the tenant submitted that in Dr. K. Madan, the Supreme Court was concerned with clause (e) of the proviso to Section 14(1) of the Act. As such, he submitted that this decision was not at all applicable to the facts of the present case. I am not in agreement with learned counsel for the tenant. It is of no consequence whether the Supreme Court was dealing with Clause (e) or not. What was held by the Supreme Court was that premises which are regularly used as a lodging house cannot be said to be premises used for residential purposes. This is the law laid down by the Supreme Court and it is immaterial if it was laid down in the context of Clause (e) or otherwise.

29. I have, therefore, no difficulty in holding that the tenant used the first floor of the premises contrary to the perpetual lease deed dated 19th December, 1938.

30. Having come to the above conclusions, the only question that remains is the relief to be granted to the landlord.

31. Learned counsel for the tenant submitted that the Land & Development Office of the Government of India had demanded damages for the unauthorised construction on the second floor of the suit premises for the period from 15th January, 1975 to 14th July, 1980. This amount is lying deposited in Court. For misusing the first floor premises, damages were levied for the period 11th September, 1971 to 14th July, 1980 but these were not required to be paid in view of the findings of the Courts below.

32. During the pendency of these appeals, a learned Single Judge of this Court had directed the Land & Development Office to indicate the up-to-date arrears to be paid towards unauthorised construction and as misuser charges.

33. Consequent upon the direction of this Court, the Land & Development Office by a letter dated 26th April, 1999 indicated the further damage charges for unauthorised construction for the period 15th July, 1980 upto 14th July, 1999. According to the land & Development Office, the tenant has made further unauthorised construction on the second floor for which damages charges are also required to be paid. Misuser charges in respect of the first floor have been indicated for the period 15th July, 1980 upto 14th July, 1999.

34. The question whether there has been unauthorised construction on the second floor of the suit premises is a question of fact. Both the Courts below have found, as a fact, that there has been unauthorised construction on the second floor of the suit premises. I see no reason to interfere with this finding of fact.

35. For the period subsequent to 14th July, 1980, it has still to be determined if there is any unauthorised construction on the second floor of the suit premises. It will, therefore, be appropriate if this is determined by the learned Additional Rent Controller by taking a decision under Section 14(11) of the Act.

36. The Land & Development Office has indicated in their letters dated 20th February, 1980 and 26th April, 1999 that they are not inclined to permit the misuser on the first floor of the suit premises even on payment of misuser charges. In fact, the Assistant Settlement Commissioner filed a statement dated 6th April, 1979 before the learned Additional Rent Controller stating that-

"That question of regularistation condoning the breaches permanently or temporarily does not arise. However, the lessor may consider, if appropriate application is made by the lessee, with an undertaking to remove the breaches and to pay additional charges leviable for such unauthorised construction and misuser, that may be fixed for the period of breaches of postpone that right of re-entry till such time the breaches are finally removed".

37. Under the circumstances, there does not appear to be any option for the tenant but to stop the misuser of the first floor of the suit premises. For this, appropriate time will have to be given by the learned Additional Rent Controller.

38. After judgement was reserved, learned counsel for the landlord mentioned the matter on 15th February, 2000 at 2.00 p.m. He stated that he had given notice to learned counsel for the tenant to be present at the time of mentioning. However, learned counsel for the tenant was not present.

39. Learned counsel for the landlord stated that there is a recent decision of the Supreme Court (dated 9th February, 2000) in the case of New Delhi Municipal Council Vs. Sohan Lal Sachdev, II (2000) SLT 13 where the question which has arisen in this case has been considered by the Supreme Court.

40. A perusal of the judgment shows that one of the issues framed by the Trial Court was "Whether the user of the premises for running a guest house can be termed as commercial user?" This issue was answered in the negative by the Trial Court. The decision of the first Appellate Court on this issue has not been mentioned but in further appeal, the Delhi High Court took the view that the user of the premises for running a guest house without any kitchen facility is user for residential purpose.

41. The Supreme Court upset the view of the High Court and in paragraph 11 of the Report held as follows:

"In the case of a `guest house', the building is used for providing accommodation to `guests' who may be travellers, assengers, or such persons who may use the premises temporarily for the purpose of their stay on payment of the charges. The use for which the building is put by the keeper of the guest house, in the context cannot be said to be for purely residential purpose. Then the question is, can the use of the premises be said to be for `commercial purpose'? Keeping in mind the context in which the phrases are used and the purpose for which the classification is made, it is our considered view that the question must be answered in the affirmative".

41. To my mind, this also concludes the issue in favour of the landlord.

42. In view of the above discussion, the parties are directed to appear before the learned Additional Rent Controller on 1st March, 2000. The learned Additional Rent Controller will, after giving notice to the Land & Development Office of the Government of India, pass appropriate orders under Section 14(11) of the Act with respect to misuser charges for the first floor of the suit premises for the period commencing from 11th September, 1971 and charges for unauthorised construction for the period commencing from 15th July, 1980.

43. The appeals are disposed of with the above directions. There will, however, be no order as to costs.

44. The record of the lower Court be sent back.