By – Kirtika Chakraborty

In Supreme Court Of India

NAME OF THE CASE	Addissery Raghavan vs Cheruvalath Krishnadasan
CITATION	Civil  Appeal  No. 2528-29 of  2020    (Arising out of  SLP (Civil) Nos.4492-4493 of 2018)
DATE OF THE CASE	June 8, 2020
APPELLANT	Addissery Raghavan
RESPONDENT	Cheruvalath Krishnadasan
BENCH/JUDGE	Rohinton Fali Nariman, Navin Sinha, B.R. Gavai
STATUTES/CONSTITUTION INVOLVED	The Kerala Building (Lease and Rent Control) Act, 1965.
IMPORTANT ARTICLES/SECTIONS	Section 11(2)(b), 11(8) and 11(4)(ii) respectively of the Kerala Building (Lease and Rent Control) Act, 1965.

     ABSTRACT

On June 8, 2018, a three-judge bench of the Supreme Court of India confirmed the Appellant Court’s ruling by rejecting the eviction plea based on a genuine criterion. The Landlord filed an eviction petition against the tenant for the two rooms in question, citing arrears of rent, bonafide requirement, and material damage to the premises under Kerala Rent Control Act Sections 11(2) (b), 11(8), and 11(4) (ii). The Trial Court granted Landlord’s petition exclusively based on the bonafide requirement, rejecting the other two grounds. As a result, the eviction did not create any hardship for the tenant. On the other hand, the Appellant Court disagreed with the Trial Court’s findings. Instead, it relied on the testimony of the witness who testified that sufficient lodging was available with the Landlord. As a result, it granted the appeal and overturned the Trial Court’s decision. By acknowledging the relevant evidence on record about the matter, the HC affirmed the Trial Court’s decision and granted the eviction on the premise bonafide requirement. The Supreme Court ruled that the HC in question had gone beyond its revisional authority. As a result, it upheld the Appellant Authority’s decision, granted the appeal, and overturned the eviction order.

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INTRODUCTION

In Addissery Raghavan vs. Cheruvalath Krishnadasan, the Supreme Court held on June 8, 2020, that the High Court has the right to assess its correctness, validity, and propriety of any decision or order assailed before it under the Rent Control Acts. The High Court, on the other hand, was held that to satisfy itself of the regularity, accuracy, legality, or decency of the impugned decision or order, it could not use its appellate power to re-appreciate or re-assess the evidence in order to reach a different conclusion on the facts. The power of revision is not and cannot be equated with the power of a court of the first appeal to reexamine all questions of fact. The High Court was told that if it needs to be convinced that a decision is valid, it might look into whether the order in question has any procedural irregularities or illegalities.

The Bench of Justice R.F. Nariman, Justice Navin Sinha and Justice B.R. Gavai held that the Appellate Authority’s reliance on the Building Tax Assessment Register, which showed that some of the Landlord’s rooms were vacant, is a finding of fact that cannot be overturned in the manner done by the High Court in revision under Section 20 of the Kerala Rent Control Act. In the facts of the case, the SC concluded that the Appellate Authority’s determination of point puts an end to any bonafide necessity of further accommodation by the Landlord.

BACKGROUND

The Rent Control Court found that the Landlord is entitled to an order of eviction under Section 11(8) of the Act because the Landlord’s claim of a genuine need for additional accommodation is valid, and the hardship that an order of eviction would cause to the tenant would not outweigh the benefit to the Landlord. However,  in the appeals, the Appellate Authority overturned the Rent Control Court’s findings of bonafide and found that the Landlord has vacant rooms in three other buildings in his possession, indicating that the need projected is not a bonafide one and that the hardship to the tenant would outweigh the benefit to the Landlord.

The property owner had three other buildings in his possession, according to the Appellate Court, one of which was a new block constructed on the same premises, another of which was a building complex known as “Syamala Memorial Building,” and the third of which was a multi-story building constructed 200 meters away from the petition schedule building. In light of the aforementioned building’s ownership and possession, the appellate Court has determined that he can set up his office in any of the properties mentioned above without facing eviction. In terms of comparative hardship, the Court below found that the Rent Control Court erred by dismissing the local authority’s Ext.B3 Building Tax Assessment Register. It has come out in evidence that the Landlord has vacant rooms in another building in his possession. In contrast, the tenant has no other facility in his residence. As a result, the tenant wins based on comparative suffering under Section 11(10)’s first proviso.

FACTS

The appellant is a tenant of the respondent landlord’s two retail rooms. The respondent filed an eviction petition for the said rooms on three grounds: I rent arrears, (ii) bona fide need for additional accommodation for the Landlord’s business, and (iii) material damage to the premises, all of which are covered by Sections 11(2)(b), 11(8), and 11(4)(ii) of the Kerala Building(Lease and Rent Control) Act, 1965.

The trial court granted the eviction petitions under Section 11(8) of the Kerala Rent Control Act on the grounds that the Landlord would be able to conduct his business more efficiently with the availability of two rooms now occupied by the tenant. The trial judge further said that the tenant has not shown that he has been subjected to undue hardship. The Rent Control Appellate Authority overturned the trial court’s decision. According to the Commissioner’s report and the appellant’s statement, there are sufficient vacant rooms in the respondent’s possession in the same building and other properties controlled by the Landlord. It was argued that the tenant’s suffering would surpass the Landlord’s benefit.

The High Court maintained the trial court’s ruling in a revision petition filed by the respondent under section 20 of the Kerala Rent Control Act, holding that if the eviction order is issued, it will not outweigh the benefit to the Landlord. The appellant-tenant has filed an appeal because he has been wronged.

ISSUE

• The Landlord was facing a joint ruling dismissing Rent Control Petitions filed under Section 11(8) of the Kerala Buildings (Lease and Rent Control) Act, 1965 (for short, “the Act”), has filed a Revision with this Court, challenging the Act’s conflicting conclusions under Section 11(8).
• The appellant is the occupant of two store rooms, one on the ground floor and the other on the first floor, both comprising 60 square feet in the instant instance. The tenant operates a textile company in the ground-level room and uses the first floor as a godown.

• On 10.10.1991, the tenant rented the ground floor room for Rs.300/- per month, which was later increased to Rs.800/-. The renter rented the first floor room on July 10, 1998, for Rs.250/- per month, which was later increased to Rs.317/-. Signature Not Validated BAJAJ digitally signed

ARGUMENTS FROM THE APPELLANT SIDE

” According to the appellant, if at all the respondent needs any rooms for the purpose of expanding his office, suitable rooms are available in his possession. It has come in evidence that in the building in which the petition schedule rooms are situated, there are as many as 36 rooms. According to the appellant, the same rooms are lying vacant in this building. The respondent would deny the contention. But in Ex.C1 report, the Commissioner only would say that majority of the rooms in the building are leased out. This shows that some of the rooms in the occupation of the petitioner are lying vacant. It is true that the Commissioner has not specified the number of rooms lying vacant. The appellant also could not point out the number of the rooms lying vacant in the possession of the petitioner.” Apart from this, it also relied upon several vacant rooms being available in several other buildings owned by the Landlord. So far as Exhibit B3 is concerned, the trial court’s finding was reversed, stating:

“The lower Court has blamed the appellant for not producing any documents to show that vacant rooms are available in the possession of the respondent. I cannot agree with the observation made by the lower Court. When there is an admission by PW1 that there are vacant rooms, there is no need to produce any document. It can also be seen that the appellant has produced Ex.B3 series document Building Tax Assessment Register. It would show that some of the rooms belonging to the respondent are lying vacant. The lower court refused to rely upon Ex.B3 series, observing that though the petition schedule shop rooms are admittedly in the possession of the appellant, one of the rooms is shown as lying vacant.”

“The learned counsel for the appellant has placed reliance on a three-Judge Bench decision of this Court in Rukmini Amma Saradamma v. Kallyani Sulochana [Rukmini Amma Saradamma v. Kallyani Sulochana, (1993) 1 SCC 499] wherein Section 20 of the Kerala Rent Control Act was in question. It was held in the said decision that though Section 20 of the said Act provided that the Revisional Court can go into the ‘propriety of the order but it does not entitle the Revisional Court to reappreciate the evidence. A similar view was taken by a two-Judge Bench of this Court in Ubaiba v. Damodaran [Ubaiba v. Damodaran, (1999) 5 SCC 645]”

ARGUMENTS FROM THE RESPONDENT

“In a revision petition filed by the respondent-landlord under Section 20 of the Kerala Rent Control Act, the High Court interfered with the findings of fact by the Appellate Authority by posing two questions before itself, namely:

 What is the scope and extent of enquiry under Section 11(8) of the Act? Where the Landlord is occupying a part of the building in which the petition schedule building is situated, whether the availability of other vacant rooms, in his possession, in any other building would negative his claim under Section 11(8) of the Act?” After stating that Section 11(8) of the Kerala Rent Control Act speaks of vacant space or rooms in the same building, it was held that the Appellate Authority was wrong in considering vacant rooms in other buildings. So far as the Commissioner’s Report was concerned, the High Court reiterated the findings of the trial court, stating that the Commissioner had not reported the availability of any vacant room and that the burden is on the tenant to show that the Landlord had in his possession other vacant rooms. So far as Exhibit B3, being the Building Tax Assessment Register is concerned, it was held that the entries in the said Register cannot be taken as conclusive proof and must therefore be discarded. On comparative hardship, the High Court agreed with the trial court, holding:

“Similarly, it has come out in evidence that the tenant has been in occupation of another room in the building owned by one Abdul Rehman. In the Rent Control Petitions, the Landlord has specifically stated that he is in occupation of another shop room in the building of the said Abdul Rehman. So, if an order of eviction is passed, he will not be put to any hardship. The tenant’s occupation in the building owned by Abdul Rehman has come out in evidence. In that view, we find that the Rent Control Court is justified in finding that the hardship that may be caused to the tenant if an order of eviction is passed, would not outweigh the advantage to the Landlord.”

“On the other hand, the learned counsel for the respondent has relied upon a decision of this Court in Ram Dass v. Ishwar Chander [Ram Dass v. Ishwar Chander, (1988) 3 SCC 131] which was also a three-Judge Bench decision. It has been held in that case that the expression’ legality and propriety’ enable the High Court in revisional jurisdiction to reappraise the evidence while considering the findings of the first appellate Court. A similar view was taken by another three-Judge Bench of this Court in Moti Ram v. Suraj Bhan [Moti Ram v. Suraj Bhan, AIR 1960 SC 655]”

RELATED PROVISIONS

• Section 11 of the  Kerala Rent Control Act,1965

“Eviction of tenants. – (1) Notwithstanding anything to the contrary contained in any other law or contract a tenant shall not be evicted, whether in the execution of a decree or otherwise, except in accordance with provisions of this Act;

Provided that nothing contained in this section shall apply to a tenant whose Landlord is the State Government or the Central Government or other public authority notified under this Act.

Provided further that where the tenant denies the title of the Landlord or claims right of permanent tenancy, the Rent Control Court shall decide whether the denial or claim is bona fide and if it records a finding to that effect, the Landlord shall be entitled to sue for eviction of the tenant in a Civil Court and such Court may pass a decree for eviction on any of the grounds mentioned in this section, notwithstanding that the Court finds that such denial does not involve forfeiture of the lease or that the claim is unfounded.

(2).

 (b) If the Rent Control Court order giving the tenant a reasonable opportunity of showing cause against the application is satisfied that the tenant has not paid or tendered the rent due by him in respect of the building within fifteen days after the expiry of the time fixed in the agreement of tenancy with his Landlord or in the absence of any such agreement by the last day of the month next following that for which the rent is payable, it shall make an order directing the tenant to put the landlord in possession of the building and if it is not satisfied it shall make an order rejecting the application thereof by him;

Provided that where an application under this subsection shall be made only if the Landlord has sent a registered notice to the tenant intimating the default and the tenant has failed to pay or tender the rent together with interest at six per cent per annum and postal charge incurred in sending the notice within fifteen days of the receipt of the notice of refusal thereof.

Provided further that the Rent Control Court shall not give any direction to a tenant to put the Landlord in possession if such tenant is

(4) A landlord may apply to the Rent Control Court for an order directing the tenant to put the landlord in possession of the building-

(ii) If the tenant uses the building in such a manner as to destroy or reduce its value or utility materially and permanently;

(8) A landlord who is occupying only a part of a building, may apply to the Rent Control Court for an order directing any tenant occupying the whole or any portion of the remaining part of the building to put the Landlord in possession thereof if he requires additional accommodation for his personal use.”

JUDGEMENT

The Supreme Court of India declared in its decision that

In contrast to Section 13(2) of the Bombay Rent Act, Section 11(8) of the Kerala Rent Act does not allow for partial eviction when the relative hardships of a landlord and a tenant are measured against each other. That the Landlord will be able to manage his business more efficiently if he obtains the scheduled petition rooms, which will assist him in leading his firm to prosperity, as opposed to the tenant, who will be unable to “establish considerable trouble to him” if he obtains the schedule petition rooms. Furthermore, the SC supported the Appellant Court’s decision by denying the eviction plea based on the bonafide condition. It has also indicated unequivocally that the HC’s revisional competence was exceeded. The eviction order is overturned as a result of the appeal.

” In view of the above analysis, we set aside the impugned judgment passed by the Appellate Authority, and the order passed by the Rent Control Court will stand restored to the files. The Rent Control Revisions are disposed of accordingly.

 Having regard to the entire facts and circumstances of the case, the respondent/tenant is given eight months from today to vacate the petition schedule building, on the following conditions:

 The respondent/tenant shall file an affidavit, within two weeks from the date of receipt of a copy of this order, before the Execution Court or the Rent Control Court, as the case may be, expressing an undertaking that he will vacate the petition schedule shop room within eight months from today.

The respondent/tenant shall deposit entire arrears, if any, within one month, before the Execution Court or the Rent Control Court, as the case may be, and shall continue to pay rent without default.

 In the event of failure to comply with any of the conditions stated above, the time granted to vacate the premises will stand automatically vacated and the petitioner/landlord will be at liberty to proceed with the execution of the eviction order.”

CONCLUSION Interfering with this factual conclusion without any perversity or misappreciation of evidence by the Appellate Authority, the Court ruled, would be obviously outside the High Court’s revisional competence. Equally, the finding of comparative hardship, which is a factual conclusion not otherwise proven to be perverse, cannot be overturned in the manner done by the High Court in this case. The Supreme Court held that the trial court answered the issue by simply stating that the Landlord will be able to run his business more efficiently if he receives the scheduled petition rooms, which will help him lead his company to prosperity, as opposed to the tenant, who cannot “establish much hardship to him.” The Appellate Authority had the right to overturn this ambiguous conclusion, it was held. The Supreme Court decided that by substituting the same without finding it perverse, the High Court operated outside of its revisional competence. In this instance, the Appellate Authority denied the Landlord’s bona fide request for additional space, which the HC later overturned. For these grounds, the SC granted the appeal and reversed the High Court’s decision, restoring the Appellate Authority’s decision.