Tag Archives: Tenancy Law

Once Lease or Tenancy Stands Determined – Tenant’s Right to Possess the Leased Property Ends

In Atma Ram Properties (P) Ltd. v. Federal Motors (P) Ltd., (2005) 1 SCC 705, the Hon’ble Supreme Court observed that “the litigation goes on for an unreasonable length of time and the tenants in possession of the premises do not miss any opportunity of filing appeals or revisions so long as they can thereby afford to perpetuate the life of litigation and continue in occupation of the premises.” It has, then, observed that once the lease or tenancy stands determined, say, through a decree from a competent court, the tenant’s right to continue to possess the leased property ends. And for his continued use and occupation of the property for any period thereafter, he must pay damages at the rate the landlord could have let out the premises if there had been no tenant or the tenant had vacated with the lease termination. Thus, Atma Ram Properties (P) Ltd. v. Federal Motors (P) Ltd., (2005) 1 SCC 705 has summed up the principles of interim compensation:

(1) while passing an order of stay under Rule 5 of Order 41 of the Code of Civil Procedure, 1908, the appellate Court does have jurisdiction to put the applicant on such reasonable terms as would in its opinion reasonably compensate the decree-holder for loss occasioned by delay in execution of decree by the grant of stay order, in the event of the appeal being dismissed and in so far as those proceedings are concerned. Such terms, needless to say, shall be reasonable;

(2) in case of premises governed by the provisions of the Delhi Rent Control Act, 1958, in view of the definition of tenant contained in clause (l) of Section 2 of the Act, the tenancy does not stand terminated merely by its termination under the general law; it terminates with the passing of the decree for eviction. With effect from that date, the tenant is liable to pay mesne profits or compensation for use and occupation of the premises at the same rate at which the landlord would have been able to let out the premises and earn rent if the tenant would have vacated the premises. The landlord is not bound by the contractual rate of rent effective for the period preceding the date of the decree; (3) the doctrine of merger does not have the effect of postponing the date of termination of tenancy merely because the decree of eviction stands merged in the decree passed by the superior forum at a later date. Ishwarlal Vrajlal Mistry v. Manohar U. Shetty, Writ Petition No. 13100 of 2018 decided on 18.12.2019.

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“Tenant at Sufferance”

        ‘Tenant at sufferance’ is one who comes into possession of land by lawful title, but who holds it by wrong after termination of term or expiry of lease by efflux of time. The tenant at sufferance is on who wrongfully continues in possession after extinction of a lawful title. There is little difference between him and a trespasser. A “tenancy at sufferance” does not create relationship of landlord and tenant.

        Moreover, even possession of lessee after determination of lease or expiry of period of lease becomes that of “Tenant at Sufferance”, therefore, even a quit notice is not necessary to be given and Section 106, Transfer of Property Act, 1882 is not at all attracted. Relying on earlier decision in R.V. Bhupal Prasad v. State of A.P., (1995) 5 SCC 698, the Hon’ble Apex Court in Sevoke Properties Ltd. v. West Bengal State Electricity Distribution Company Ltd., AIR 2019 SC 2664 held that once it is admitted by lessee that term of lease has expired, lease stood determined by efflux of time and in such a case, a quit notice under Section 106 of the Transfer of Property is not required to be given. It was held as under:

        “Once the lease stood determined by efflux of time, there was no necessity for a notice of termination under Section 106.” Lov Mandeshwari Saran Singh v. State of U.P., 2020 (138) ALR 845.

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Entertainment of – Release Application

The phrase “entertained” used in the 1st proviso to Section 21(1)(a) of the Uttar Pradesh Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 would mean that the period of three years since the date of purchase by the landlord must have expired when the Prescribed Authority is required to entertain the release application on the grounds mentioned in Clause (a) of Section 21(1) of Uttar Pradesh Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972. This would be a stage reached when the Court applies its judicial mind and takes up the case for decision on merits concerning the grounds mentioned in Clause (a) of Section 21(1) of Uttar Pradesh Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972. The word “entertained” would necessarily mean entertain the grounds for consideration for the purpose of adjudication of merits and not at any stage prior thereto, i.e. neither at the stage at which the application is filed in the office of the prescribed authority nor at the stage when summons is issued to the tenant. The crux of the conclusion is that by the time the application for possession on the grounds mentioned in clause (a) of Section 21(1) is taken up by the Prescribed Authority for consideration on merits, at least minimum three years period should have elapsed since the date of purchase of the premises by the landlord/landlady. Pradeep Kumar v. Meena Devi Sahu, 2020 (138) ALR 91.

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Building in Possession of Tenant – Before its Purchase by Landlord

The first proviso to Uttar Pradesh Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 provides that where the building was in occupation of a tenant since before its purchase by the landlord, such purchase being made after the commencement of the Act, no application shall be entertained on the grounds, mentioned in Clause (a), unless a period of 3 years has elapsed since the date of such purchase and the landlord has given a notice in that behalf to the tenant not less than six months before such application, and such notice may be given even before the expiration of the aforesaid period of three years. Smt. Meena Begum v. Additional District Judge, 2018 (127) ALR 358.

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Property Owner – Has the Right to Use the Property As he Chooses

In Faruk Ilahi Tamboli v. B. S. Shankarrao Kokate, 2016 (1) ARC 1, the Hon’ble Supreme Court held that it certainly cannot be the claim at the behest of a tenant, that the owner of a premises must continue in business with his parents or relations, assuming there was a joint business activity, to start with. That is usual, assuming there was a joint business activity, to start with. That is usual, and happens all the time when children come of age. And thereafter, they must have the choice to run their own life, by earning their own livelihood. The property owner has the right to use his property as he chooses, for running his business. There could be no irregularity if owner of the property chooses to use his property as he chooses, for running his business, independent of the business of other family members. In Anil Bajaj v. Vinod Ahuja, 2014 (2) ARC 265, the Hon’ble Supreme Court held that it is not for the tenant to dictate to the landlord as to how the property belonging to the landlord should be utilized by him for the purpose of his business. Even if the landlord is doing business from various other premises, it cannot foreclose his right to seek eviction from the tenanted presmises so long as he intends to use the said tenanted premises for his own business. Hari Shanker v. Om Prakash, 2018 (127) ALR 589.

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Statutory Tenant

 In Gian Devi Anand v. Jeevan Kumar, (1985) 2 SCC 683, a Constitution Bench of the Hon’ble Supreme Court dealt with the question – whether the rule of heritability extends to a statutory tenancy of commercial premises as much as it did to residential premises under the Delhi Rent Control Act, 1958. The Court while holding this in the affirmative discussed the concept of statutory tenant and held thus:

“”Statutory tenant” is not an expression to be found in any provision of the Delhi Rent Control Act, 1958 or the rent control legislation of any other State. It is an expression coined by the Judges in England and, like many other concepts in English law, it has been imported into the jurisprudence of this country and has become an expression of common use to denote a tenant whose contractual tenancy has been determined but who is continuing in possession of the premises by virtue of the protection against eviction afforded to him by the rent control legislation. Though the expression “statutory tenant” has not been used in any rent control legislation the concept of statutory tenant finds recognition in almost every rent control legislation.…

It is also important to note that notwithstanding the termination of the contractual tenancy by the landlord, the tenant is afforded protection against eviction and is permitted to continue to remain in possession even after the termination of the contractual tenancy by the Act in question and invariably by all the Rent Acts in force in various States so long as an order or decree for eviction against the tenant on any of the grounds specified in such Acts on the basis of which an order or decree for eviction against the tenant can be passed, is not passed.

The termination of the contractual tenancy in view of the definition of tenant in the Act does not bring about any change in the status and legal position of the tenant, unless there are contrary provisions in the Act; and, the tenant notwithstanding the termination of tenancy does enjoy an estate or interest in the tenanted premises. This interest or estate which the tenant under the Act despite termination of the contractual tenancy continues to enjoy creates a heritable interest in the absence of any provision to the contrary.”

         In Krishna Prosad Bose v. Sarajubala Dassi , AIR 1961 Cal 505, it was held as under:   “The Rent Control and the Tenancy Acts create a special world of their own. They speak of life after death. The statutory tenancy arises phoenix-like out of the ashes of the contractual tenancy. The contractual tenant may die but the statutory tenant may live long thereafter. The statutory tenant is an ex-tenant and yet he is a tenant.” R.S. Grewal v. Chander Parkash Soni, (2019) 6 SCC 216.

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Roof – Not a Necessary and Indispensable Adjunct for a Building

From a bare perusal of the definition of “building” in Section 3(i) of the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972, it is clear that unless the context otherwise requires, “building” means a residential or non-residential roofed structure and includes any land (including any garden), garages and out houses, appurtenant to such building; any furniture supplied by the landlord for use in such building and any fittings and fixtures affixed to such building for the more beneficial enjoyment thereof. As held by the Hon’ble Supreme Court in Ashok Kapil v. Sana Ullah, (1996) 6 SCC 342 a structure or edifice enclosing a space within its walls and usually but not necessarily, covered with a roof is a building. Roof is not necessary and indispensable adjunct for a building because there can be roofless buildings. The “building” as defined in Section 3(i) of the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972, is a residential or non-residential roofed structure and includes any land (including any garden), garages and out-houses, appurtenant to such building. Therefore, an open land including any garden, garages and out-houses, appurtenant to a roofed structure for its beneficial enjoyment shall be a building within the meaning of Section 3(i) of the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972. Munnu Yadavi v. Ram Kumar Yadav, 2020 (138) ALR 70.   

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