Tag Archives: Tenancy Rights

One Co-Owner – Can Maintain An Action for Eviction

One co-owner, in the absence of any objection from the other co-owners, can maintain an action for eviction against a tenant, without impleading all the co-owners. The governing principle is the doctrine of agency. When one co-owner institutes a suit for eviction against the tenant, it is construed as the suit having been instituted in his own right and also as an agent of the other co-owners. What is of importance is the jural-relationship of the landlord and tenant. Once a co-owner satisfies the description of the landlord, the fact that the other co-owners have not joined in action pales in significance and does not affect the maintainability of the suit. Of course, different considerations come into play when existence of a dispute between the co-owners as regards the institution of the very action of eviction, is brought to the notice of the Court.

A reference in this context can be made to a decision of the Hon’ble Supreme Court in the case of Mohinder Prasad Jain v. Manohar Lal Jain, (2006) 2 SCC 724, wherein it was held as under:

This question now stands concluded by a decision of this Court in India Umbrella Manufacturing Cov. Bhagabandei Agarwalla (Dead) by Lrs. Savitri Agarwalla (Smt.), (2004) 3 SCC 178,wherein the Hon’ble Court opined:

 It is well settled that one of the co-owners can file a suit for eviction of a tenant in the property generally owned by the co-owners. (See Sri. Ram Pasricha v. Jagannath, (1976) 4 SCC 184 and Dhannalal v. Kalawatibai, (2002) 6 SCC 16.This principle is based on the doctrine of agency. One co-owner filing a suit for eviction against the tenant does so on his own behalf in his own right and as an agent of the other co-owners. The consent of other co-owners is assumed as taken unless it is shown that the other co-owners were not agreeable to eject the tenant and the suit was filed in spite of their disagreement. In the present case, the suit was filed by both the co-owners. One of the co-owners cannot withdraw his consent midway the suit so as to prejudice the other co-owner. The suit once filed, the rights of the parties stand crystallised on the date of the suit and the entitlement of the co-owners to seek ejectment must be adjudged by reference to the date of institution of the suit; the only exception being when by virtue of a subsequent event the entitlement of the body of co-owners to eject the tenant comes to an end by act of parties or by operation of law.”

A suit filed by a co-owner, thus, is maintainable in law. It is not necessary for the co-owner to show before initiating the eviction proceeding before the Rent Controller that he had taken option or consent of the other co-owners. However, in the event, a co-owner objects thereto, the same may be a relevant fact. In the instant case, nothing has been brought on record to show that the co-owners of the respondent had objected to eviction proceedings initiated by the respondent herein.

 This aspect was again considered by the Hon’ble Supreme Court in the case of Boorugu Mahadev and Sons v. Sirigiri Narasing Rao, (2016) 3 SCC 343, in the context of the proceedings between a landlord and tenant, governed by the rent control legislation. The Supreme Court enunciated that the concept of ownership and consequently the right to sue, in such cases, has to be distinguished from the one in a title suit. The observations in the said judgment are extracted below:

 It is also now a settled principle of law that the concept of ownership in a landlord-tenant litigation governed by Rent control laws has to be distinguished from the one in a title suit. Indeed, ownership is a relative term, the import whereof depends on the context in which it is used. In rent control legislation, the landlord can be said to be the owner if he is entitled in his own legal right, as distinguished from for and on behalf of someone else to evict the tenant and then to retain control, hold and use the premises for himself. What may suffice and hold good as proof of ownership in landlord-tenant litigation probably may or may not be enough to successfully sustain a claim for ownership in a title suit. (vide Sheela v. Firm Prahlad Rai Prem Prakash(2002) 3 SCC 375).” Madhuri Doulatram Choitram v. Lachmandas Tulsiram Nayar, 2019 SCC Online Bom 6111.

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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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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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SARFAESI Act – Rights of a Rightful Tenant

If a valid tenancy under law is in existence even prior to the creation of the mortgage, the tenant’s possession cannot be disturbed by the secured creditor by taking possession of the property. The lease has to be determined in accordance with Section 111 of the Transfer of Property Act for determination of leases. As the existence of a prior existing lease inevitably affects the risk undertaken by the bank while providing the loan, it is expected of banks/creditors to have conducted a standard due diligence in this regard. Where the bank has proceeded to accept such a property as mortgage, it will be presumed that it has consented to the risk that comes as a consequence of the existing tenancy. In such a situation, the rights of a rightful tenant cannot be compromised under the SARFAESI Act proceedings. Bajrang Shyamsunder Agarwal v. Central Bank of India, (2019) 9 SCC 94.

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Lease of Immovable Property

Immovable property means landed property and may include structures embedded in the earth such as walls or building for the permanent beneficial enjoyment. A lease of immovable property is a transfer of right to enjoy such property ion consideration of price paid as per Section 105 of the Transfer of Property Act. By way of lease, a right and interest is created which stands transferred ion favour of the lessee. The immovable property, thereafter, only can be reverted back on determination of such right and interest in accordance with the provisions of the Transfer of Property Act. Therefore, once the right of lease is transferred in favour of the lessee, the destruction of a house/building constructed on the lease property does not determine the tenancy rights of occupant which is incidental to the contract of the lease which continues to exist between the parties. Shaha Ratansi Khimji and Sons v. Proposed Kumbhar Sons Hotel Pvt. Ltd., 2014 (5) AWC 4394 (SC).

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