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Smt. Gian Devi Anand Vs. Jeevan Kumar and Others

Supreme Court Of India Civil Appeal /3441/1972

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SMT. GIAN DEVI ANAND

JEEVAN KUMAR AND OTHERS

May 1, 1985

[Y.V. CHANDRACHUD, C.J., P.N. BHAGWATI, S. MURTAZA

FAZAL ALI, AMARENDRA NATH SEN AND

V. BALAKRISHNA ERADI, JJ.j

Delhi Rini Control Act, 1958, ss. 14(1)(a) and 15(1)-Helrs of a dtceastd

tenant-Whether enjoy protection under the Act-Commercial tenancY-Whether

heritable.

The appellant's husband was the tenant in respect of a shop under the

respondent-landlord since

1979. In

1970 the respondent-landlord served a notice

on the appellant's husband determining the tenancy. Thereafter, he

filed a

petition under section

14 of the Delhi Rent Control Act, 1958 for eviction of the

tenant from the said shop on several grounds including the grounds of non·

payment of rent and sub-letting. The Rent Controller dismissed the petition .

Against the order of the Rent Controller the respondent-landlord preferred an

appeal bef9re the Rent Control Tribunal and the tenant filed cross-objections.

During the pendency of the appeal, the tenant died and the present appelJant

was substituted. The Rent Control Tribunal remanded the case to the Rent

Controller to decide the question of sub-letting afresh after affording an

opportunity to the parties to lead evidence.

Aggrieved by the order of the Rent Control Tribunal, the appellant filed

an appeal in the High Court. The respondent-landlord filed cross-objection

and further raised a contention that in view of the death of the original

tenant who continued to remain in possession of the shop as a statutory tenant,

the widow and the heirs of the deceased-tenant were not entitled to coutinuc

to remain in occupation thereof. The High Court allowed the cross-objection

filed by the respondent-landlord and passed a decree for eviction against the

appellant mainly on the ground that the protection afforded to the statutory

tenant

by the Act was not available to the heirs and the legal representatives.

In appeal to this Court the appellant while relying upon Damadi Lal and

Ors. v. Parashram and Ors. [1976] Supp. S.CR. 645 and V. Dhanapa/ Chettiar

v. Yesodai Ammal [1980] 1 S.C.R. 334, contended that notwithstandina the

determination of the statutory tenancy of the tenant in respect of any

commercial premises, the position in law remains unchanged in so far as the

tenancy in respect of commercial premises is concerned by virtue of the

provisions of the Act. The respondent, however argued (i) that the protection

against the eviction after termination of tenancy afforded to a tenant by the

Act creates a personal ri8:ht in favour of the tenant who continues to remain

in possession after termination of hi~ tenancy without aity estate or interest in

SUPREME COURT REPORTS . (1985) SUPPL. S.C.R.

the premises and therefore on the death of such a tenant his heirs who bad

neither any estate

or interest in the tepanted premises and who do not have

any

pro~ection tinder the Act agaiust eviction are liable to be evicted as a

mattet of course under the ordioary law of the land ; and tii) that the amend~

ment to the definition of 'tenant' with retrospective effect introduced by the

Delhi Rent Control Amendment Act (Act

18 of 1976) to give personal

pro·

tection and personal' right to continue in possession to the heirs of the deceased

statutory tenant in respect

of residential

pr~mises only and not with regard to

the so called statutory tenant in respect

of commercial premises indicated that

the heirs of

so called statutory tenant, do not enjoy any protection under the

Act.

Allowing the appeal,

[Per Y. V. Chandrachud C.J., S.M. Fazal Ali, A.N. Se11 and V.B. Eradi JJ.]

HELD: (l)(i) The term "statutory tenant" is used in English Rent

Act

and though this term is not to be found in the Indian Acts, in the

judg~

ments of the Supreme Court and also various High Courts in India, this term

has often been used to denote a tenant whose contractual tenancy has bf:en

terminated but who has become entitled to continue to remain in possession

by virtue

of the protection afforded to him by the statutes in question; namely,

the various Rent Control Acts prevailing in different

States of lndia. It is

also important to note that notwithstanding the termination of the contractual

tenancy

tffe 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

fn various States so long as an order of 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. [14 H; 15 A-BJ

(l)(ii) Though provisions of all the Rent Control Acts are not uniform,

the common feature

of all the Rent Control Legislation is that a contractual

tenant on the termination

of the contractual tenancy is by virtue of the

pro.

visions of the Rent Acts not liable to be evicted as a malter of course under

the ordinary

law of the land and he is entitled to remain in possession

even

after determination of the contractual tenancy and no order or decree for

eYiction will be passed against a tenant unless any ground which entitles the

landlord go get an order or decree for possession specified in the Act is

established.

(25 D-E]

(2)(i)

It is clear from the definition of tenant, whether in the original

Act or in the amended Act, that the tenant within the meaning

of the definition

of the tern1 in the Act includes any person continuing in possession after the

termination of his tenancy.

{28 G]

(2)(ii)

Section 14 of the Act clearly rostulates that despite the termina.

tion of the tenancy and notwithstanding the provisions of any other law

which might have been applicable on the termination of the contractual

tenancr, protection against eviction is applicabl~ t() r;very tenant as defined

lllfl:c

·1

GIAN DEVI ANAND V. JEBVAN KUMAR 3

in S. 2(i) of the Act. This section clearly establishes that determination of a

contractual tenancy does not disqualify him from continuing to

be a tenant

within the meaning

of this Act and the tenant whose contractual tenancy has

been determined

enjoys the same position an4 is entitled to protection against

eviction. The other sections in Chapter III also go to indicate that the tenant

whose tenancy has been terminated enjoys the same status and benefit as a

tenant whose tenancy has not been terminated, and a tenant after termination

of his tenancy stands on the same footing as the tenant before such

termina

tion. Chapter Ill A which provides for summary trial for certain applications

also does not make any distinction between a tenant whose tenancy has

been determined and a tenant whose tenancy has not been terminated.

Chapter

IV which deals with deposit of rent consists of ss. 26 to 29

and these sections make it clear that the tenant after determination of a

tenancy

is treated under the Act on the same footing as a tenant whose

tenancy has not been determined. Chapter

VI though not very material for

the purpose

of adjudication of the point involved indicates that no discrimi ..

nation is made in the matter of proceedings for eviction

bet,veen the •so called

statutory tenant' and a contractual tenant. Chapter VII which consists of

sections 44 to 49 makes provisions regarding obligations of landlords and also

provides fo~ penalties in appropriate cases. The sections make it clear that

the duties and ooligations of landlords cast upon the landlord apply equally

whether the tenant

is a so called 'statutory tenant' or

the tenant is a con·

tractual tenant. It may, however, be noted that section 50 which bars the

jurisdiction

of Civil Courts in respect of certain matters does not in any way

discrimate between a 'so called statutory tenant' and a contractural tenant.

Thus, the various provisions

of the Act, make it abundantly clear that the Act

does not make any distinction between a

·so called statutory tenant' and a

'contractual tenant' and the

Act proceeds to treat both alike and to preserve

and protect the status and rights

of a tenant after determination of the

con

tractual tenancy in the same way as the status and rights of a contractural

tenant are protected and preserved.

(30 A-H; 31 A]

V. Dhanpal Chattiar v.

Yesodai Ammal, (1980] 1 SCR 334, relied upon,

(3)(i} The termination of the contractural tenancy in view of the

definition

of 'tenant' in the Act does not brin.g 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

con

tinues to enjoy creates a heritable interest in the absence of any provision to

the contrary. The amendment

of the definition of 'tenant' by Act 18 of 1976

introducing particulary section 2(i)(iii) does not in any way mitigate against

this

view. The said sub-section (iii) with all the three Explanations thereto

is not in any way inconsistent with or contrary to sub-section (iiJ of

Section

2(1) which unequivocally states that 'tepant' includes any person continuing in

possession after the termination of his tenancy. In the absence

of the

provision contained

in sub-section 2(i)(iii), the heritable interest of the heirs

of the statutory tenant would devolve on all the heirs of the 'so called statutory

tenant• on his death and the heirs of such tenant would in law step into his

position. (33 G-H; 33 A-CJ

Damadial & Ors. v. Pmaslirom & Ors., [1976] Supp. S.C.R. 645 followed,

4 SUPREME COURT REPORTS (1985[SUPPL. S.C.R.

(3)(ii) Section 2(i)(iii) of the Act does not create any additional or

special right in favour of the heirs of the 'so called statutory tenant' on his

death, but seeks to restrict the right

of the heirs of such tenant in respect of

residential premises. As the status and rights of a contractual tenant even

after determination

of his tenancy when the tenant is at times described as the

statutory tenant, are fully protected by the Act and the

heirs of such tenants

become entitled

by virtue of the provisions of the Act to inherit the status and

position of the statutory tenant on his death, the Legislature which has created

this right has thought

it fit in the case of residential premises to limit the

rights

of the heirs in the manner and to the extent provided in s. 2(l)(iii).

However,

1he Legislature has not thought it fit to put any such restrictions

with regard

to tenants in respect of commercial premises in this Act.

So Jong

as the contractual tenancy of a tenant who carries on the business continues

there can

be no question of the heirs of the deceased tenant not only

inheritin~

the tenancy but also inheriting the business and they are entitled to run and

enjoy the same.

(33 D-G]

(3)(iii) The mere fact that in the Act no provision has been made with

regard to the heirs

of tenants in respect of commercial tenancies on the

death

of the tenant after termination of the tenancy, as has been done

in the case

of heirs of the tenants of residential premises, does not

indicate that the Legislature intended that the heirs of the tenants of

commercial premises will cease to enjoy the protection afforded to the

tenant under the Act. The Legislature could never have possible intended

that with death of a tenant of the commercial premises, the business carried

on by the tenant, however

flOurisbing it may be and even if the same

constituted the source

of livelihood of the members of the

family, must

necessarily come to an end on the death

of the tenant; only because the

tenant

died after the contractual tenancy had been terminated. (35 F·H]

(3) (iv) Jn case of commercial premises governed by tho Dolhi Act the

Legislature has

not thought to fit in the light of the situation at Delhi to place

any kind of restriction

on the ordinary law of inheritance with regard to

succession.

It may also be borne in mind that in case

of commercial premises

the heirs

of the deceased tenant not only succeed to the tenancy right in the

premises but they succeed to the business as a whole.

It might have been open

to the Legislature to limit

or restrict the right of inheritence with regard to the

tenancy as the Legislature had done in the case

of the tenancies with regard to

the residential houses but

would not have been open tc the Legislature to

alter under the Rent Act, the law of succession regarding the business which

is a valuable heritable right and which must necessarily devolve on all the

heirs in accordance with law. The absence

of any provision restricting the

heritability

of the tenancy in respect of the commercial premises

only

establishes that commercial tenanceis n6twithstanding the determination of the

contractual tenanceis will devolve on the heirs in accordance with

law and the

heirs who step into the

position of the deceased tenant will continue to enjoy

the protection afforded by the act and they can Qnly be evicted in accordance

\Vith the provisions of the Act. (36 B-E]

GIAN DEVI ANAND V. JBBVAN KUMAR

(3) (v) As the protection afforded by the Rent Act to a tenant after

determination of the tenancy and to his heirs on the death of such tenant

is a

creation

of the Act for the benefit of the tenants, it is open to the Legislature

which provides for such portectioo to make appropriate provisions in the Act

with regard to the nature and extent

of the benefit and protection to be enjoyed

and the manner in which

the same is to be enjoyed. Jf the Legislature makes

any provision

in the Act limiting or restricting the benefit and the nature of

the protection to be enjoyed in a specified manner by any particular class of

heirs of the deceased tenant on any condition laid down being fulfilled, the

benefit

of the protection has necessarily to be enjoyed on the fulfilment of the

condition

in the manner and to the

el:tent stipulated in the Act. The

Legislature which

by the Rent Act seeks to confer the benefit on the tenants

and to

afford protection against eviction, is perfectly competent to make

appropriate provisjon regulating the nature

of protection and the manner and

extent

of enjoyment of

such tenancy rights after the termination of contractual

tenancy

of the tenant including the rights and the nature of protection of the

heirs oa the death

of the tenant. [38

C·FJ

(3) (vi) When the tenant is a Company or a Corporation or any body

with juristic personality, question of the death of the tenant will not arise.

Despite the termination

of the tenancy, the Company or the Corporation of

such juristic personalities. however,

Y.ill go on enjoying the protection afforded

to the tenant under the Act. 1t call hardly be conceived that the Legislature

would intend to deny to one class

of tenants, namely, individuals the protection

which will

be enjoyed

by the other class, namely, the Cor'poration and

Companies and other bodies wHh juristic personality under the Act. [36 G-H)

(4) In the instant case' there

is no provision in the Act regulating the

rights

of the heirs to inherit the tenancy rights of the tenant in respect of the

tenanted premises which is commercial premises, the tenancy right which

heritable devolves on the heirs under the ordinary law of succession. The

tenancy right

of appellant's husband therefore, devolves on all the heirs on his

death. The heirs

and legal repersentatives of appellant's

husband step into his

position and they are entitled to the benefft and protection

of the Act.

There

fore, the High Court was not right in coming to the conclusion that the heirs

of appellant's husband the so called statutory tenant, did not have any right

to rem~in in possession of the. tenanted premises and did not enjoy any

protection under the Act. The Judgment and order of the High Court is there

fore set aside and the case is remanded to the High Court for decision of the

appeal and the cross objection on merits. The appeal is accordingly allowed

to the extent indicated above.

[39 B;

D-E; GJ

Ganpat Ladha v. Sashikant Vishnu Shinde, [1978] 3 s. C. R. 198 dissented .

. The Legislature may consider the advisability of making bona fide

requirement

of the landlord a ground of eviction in respect of commercial ff

premises as well.

[40 FJ

SUPREME

COURT RBPOR TS [198S] SUPPL s.C.il.,

Per Bhagwatl, J. (Concurring)

Though genetically the parentage of the two legal conce,. ts, namely.

contractual tenancy and statutory tenancy is different, one owing its origin to

C('lntract and the other to rent control legislation, they are equated with each

other and their incidents are the same.

If a contractual tenant has an estate or

interest in the premises which is heritable,

it is difficult to understand why a

statutory tenant should be held not to have such heritable estate or interest.

In one case, the estate or interest is the result of contract while in the other,

it is the result of statute. But the quality of the estate or interest is the same

in both cases. When the rent control legislation places a statutory tenant on

the same footing as a contractual tenant, wipes out the distinction between the

two and invests a statutory tenant with the same right, obligations and

incidents as a contractual tenant,

why should it be difficult to hold that, just

like a contractual tenant, a statutory tenant also has estate

or interest in the

premises which can be inherited.

(8 B-FJ

It is true that there are certain observations in Ganpat Ladha v.

Sashikant Vishnu Shinde, (1978] 3

S. C.R. 198, which go counter to what the

Court

is ho1ding in the present case and to that extent these observations must

be held not to enunciate the correct law on the subject This Court was not

really concerned in that case with the question

of heritability of statutory

tenancy. The only question was in regard' to the true interpretation

of Section

5 (ii) (c) of the Bombay Rents, Hotel and Lodging House Rates Control Act

1947 which is almost in same tern1s as Section 2 (1) (iii) of the Delhi Rent

Control Act

1958 and

while dealing with this question, the Court made certain

observations regarding the nature

of statutory tenancy and its heritability. The

attention of the Court was not focussed on the question

·Whether a statutory

tenant has an est~te or interest in the premises which is heritable anci no argu

ment was advanced that a statutory tenancy is heritable. It was assumed that

a statutory tenancy

is not heritable and on that footing the case was argued in

regard

to the true meaning and

con~truction of ~ection 5 {ii) (c). The

observations made in that case to the extent to which they conflict with the

judgment in the present case must therefore be regarded as overruled.

l9 A-D]

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3441

of 1972.

From the Judgment and Order dated 11-10-1979 of the

Delhi High Court in S.A.O. No. 8 of 1979.

S.N. Andiey, Uma Datta, T.C. Sharma and K.S. Mohan for

the Appellant.

Mrs.

Shyam/a Pappu, B.B. Sawhney, Mrs. Indra Sawhney and

Miss Kittu Bansilal for the Respondents.

,,,.. .

r GIAN DliYI ANAND v. JEEVAM KUMAR (Bhagwati, J.) 7

The following Judgments were delivered

BHAGWATI, J. I entirely agree with the Judgment just delivered

my learned brother A.N.

Sen, J. I am adding a few words of

my own since I was a party to the decision in Ganpat Ladha v.

Shashikant Vishnu Shinde(

)

where certain observations were made

which seem

to take a different view from the one we are taking in the

present case.

The question which arises here for consideration

is as to

whether statutory tanancy is heritable on the death of the statutory

tenant.

'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

arainst eviction

afforded to him

by the rent control legislation. Though the

expres

sion 'statutory tenant' has not been used in any rent control legisla

tion the concept of statutory tenant finds recognition in almost every

rent control legislation The definition

of 'tenant'

iit Section 2(1)

of the Delhi Rent Control Act 1958-and I am referr ng here to the

provisions

of the

Delhi.Rent Control Act 1958 because that is the

statute with which

we are concerned in the present case-includes a

statutory tenant.

It says in clause (ii) that 'tenant' includes any

person continuing the possession after the termination

of his

tenancy'.

Such a person would not be a tonant under the ordinary

Jaw but he is recognised as a 'tenant' by the rent control legislation

and is therefore described as a statutory tenant

contra-distingui

shed from contractual tenant. The statutory tenant is, by virtue of

inclusion in the definition of 'tenant', placed on the same footing as

contractual tenant so far as rent control legislation

is concerned.

The rent control legislation in fact, as pointed out

by this Court

in a seven judge Bench decision in

V. Dhanapa/ Chettiar v.

Yesodai Ammo/(') does not make any distinction between con

tractual tenant and statutory tenant. "It does not permit the

landlord to snap his relationship with the tenant ·merely by his act

(I) 11978] 3 S.C.R. 198.

(2) (1980] 2 S.C.R. 334.

SUPRBME COURT REPORTS [ l98SJ SUPPL. s.c.k.

of serving a notice to quit on him. Inspite of the notice, the Jaw

says that he continues to be a tenant and he does so enjoying all tbe

rights

of a lessee and is at the same time deemed to be under all the

liabilities such as payment

of rent etc. in accordance with the

law."

The distinction between contractual tenancy and statutory tenancy

is thus completely obliterated by the rent control legislation. Though

genetically the percentage

of these two legal concepts is different, one

owing its origin to contract and the other to rent control legislation,

they are equated with each other and their incidents are the

same.

If a contractual tenant has an estate or interest in the premises

which

is heritable, it is difficult to understand why a statutory tenant

should

be held not to have such heritable estate or interest. In one

case, the estate or interest

is the result of contract while in the other

it is the result

of statute. But the quality of the estate or interest is

the same iu both cases. The difficulty in recognising that a statutory

tenant can have estate

or interest in the premises arises from the

fact that throughout the last century and the first half

of the present,

almost until recent times, our thinking has

been dominated by two

major legal principles, namely, freedom

of contract and sanctity of

private property and therefore we are unable to readily accept that

legal relationships can be created

by statute despite want of

contrac·

tual concensus and in derogation of property rights of the landlord.

We are unfortunately not yet reconciled to the idea that the law is

moving forward from contract to status. Why can estate or interest

in property not be created by statute

When the rent control

legislation places a statutory tenant on the same footing as a

contractual tenant, wipes out the distinction between the two and

invests a statutory tenant with the same right, obligations and inci·

dents as a contractual tenant, why should it be difficult to hold that,

just like a contractual tenant, a statutory tenant also has estate or

interest in the premises which can be inherited. Of course, strong

reliance

was placed on behalf of the landlord on

Section 2(1) (iii) of

the Delhi Rent Control Act 1958 to combat this conclusion but that

provision merely limits or circumscribes the nature and extent

of the

protection that should be available on tbe death

of a statutory tenant

in respect

of residential premises. It does not confer a new right of

heritability which did not exist aliunde. My learned brother A.N.

Sen, J. has discussed this aspect of the case in great detail and I find

myself wholly in agreement with what

he has

rnid in regard to the

true meaning and import

Section 2(1) (iii).

CHAN DEVI ANAND v. JEEVAN KUMAR (A.N. Sen, J.) 9

Now a word about Ganpat Ladha's case (supra). It is true

that there are certain observations in that case which

go counter to A

what

we are holding in the present case and to that extent these

observations

must be held not to enunciate to correct law on the

subject. This Court

was not really concerned in that case with the

question

of heritability of statutory tenancy. The only question was

in regard to the true interpretation of Section 5(ii) (c) of the Bombay

Rents, Hotel and Lodging House Rates Control Act

1947 which is

almost in same terms as Section 2(1) (iii) of the Delhi Rent Control

Act

1958 and while dealing with this question, the Court made

certain observations regarding the nature

of statutory tenancy and its

heritability.

The attention of the Court was not focussed on the

question whether a statutory tenant has an estate or interest in the

premises

which is heritable and no argument was advanced that a

statutory tenancy

is heritable. It was assumed that a statutory

tenancy

is not heritable and on that footing the case was argued in

regard to the true meaning and construction

of Section 5(ii) (c).

The observations made in that case to the extent to which they

conflict with the judgment in the present case must therefore be

regarded

as overruled.

I accordingly concur with the order made

by my learned

brother A.N. Sen, allowing the appeal and remanding the case to the

High Court for disposal according to

law. There will be no order

as to costs.

A.N.

SEN, J. The question for consideration in this appeal by

special leave is whether under the Delhi Rent Control Act, 1958 (for

the sake of brevity hereinafter referred to

as the Act), the statutory

tenancy to use the popular phraseology, in respect

of commercial

premises

is heritable or not. To state is more precisaly, the question

is whether the heirs of a deceased tenant whose contractual tenancy

in respect of commercial premises has

been determined, are entitled

to the

same protection against eviction afforded by the Act to the

tenant.

The question is essentially a question of law. This very

question has been raised in a number of appeals, arising out of

different sets of facts giving rise, however, to this common question H

of law in all the appeals. As the decision on this corumon question

of law which arises in the other appeals pending in this Court may

effect the parties in the other appeals, we considered it proper to

IQ SUPREME COURT REPORTS (1985) SUPPL, s.c.k.

hear the counsel appearing in all the appeals on this common

question of

Jaw. We, however, feel that it will be convenient to deal

with the other appeals separately and dispose

of the same, applying

the decision or

thi; common que,tion of Jaw in the light of the facts

and circumstances

of the other cases and pass appropriate orders

and decrees in the other appeals

when they are taken up for

disposal

Though the question is mainly one of Jaw, it is necesrnry for a

proper appreciation

of the question involved to set out in brief the

facts

of the present appeal which is being disposed of by this

judgment.

One Wasti Ram

was the tenant in respect of

Shop No. 20,

New Market, West Patel Nagar, New Delhi under the respondent at

at the monthly rent

of Rs. 110. He came into possession as such

tenant on and from 1.9.1959. In April,

1970 the respondent land·

lord determined the tenancy by serving a notice to quit on the

tenant Wasti Ram, since deceased.

September, 1970, the respon·

dent landlord filed a petition under S. 14 of the Act for the eviction

of the tenant Wast! Ram from the said shop on the following

grounds

:-(1) non-payment of rent, (2)

bona·fide requirement,

(3) change of user from residential to commercial, (4) substantial

damage to property and

(5) sub-letting In the petition filed by the

landlord against the tenant Wasti Ram, the landlord had also

impleaded one Ashok Kumar

Sethi, as defendant No. 2 alleging him

to be the unlawful sub-tenant

of the tenant Wasti Ram. By

judgment and order dated 19.5.1975, the Rent Controller held that (I) the ground of bona fide requirement was not available to the

landlord under the Act in respect

of any commercial premises (2) the

premises had been

Jet out for commercial purposes and

there had

been no change

of user, (3) no substantial damage to property had

been done by tenant and

(4) sub-Jetting had been established.

the question of non-payment of Rent, the Rent Controller held

that the tenant was liable to pay a sum

of Rs. 24 by way of arrears

for the period

of 1.3.1969 to 28.2.1970 after taking into

considera

tion all payments made and a further snm of Rs. 90 on account of

such arrears for the month of September 1970 and the rent sub

sequent to the month of March, 1975, if not already deposited. In

view of the aforesaid finding on the question of ·default in payment

of rent, the Rent Controller held that the tenant was liable to

eviction under S. 14(1)(a) of the Act and further held that in view of

GIAN DEVI ANAND v. JEEVAN KUMAR (A.N. Sen, !.) 11

the provisions contained in s. 15( 1) of the Act there would however

be no order or decree for eviction

if the tenant deposited all the A

aforesaid arrears within a period

of one month from the date of the

order and in that case the ground

of non-payment of rent would

be wiped out. The Rent Controller ordered accordingly.

Against the order

of the Rent Controller, the landlord

pre·

ferred an appeal on 13.7.1975 and the tenant Wasti Ram filed his

cross-objection. The cross-objection

of the tenant was against the

order of the Rent Controller regarding his fiinding on default

payment of rent. The landlord in his appeal had challenged the

finding of the Rent Controller on the question of sub;tantial damage

to the property

by the tenant and also the finding of the Rent

Controller on the question

of sub-letting. It appears that

during·

the pendency of the appeal, the tenant Wasti Ram died and on

5.9.1977 the prerent appellant Smt. Gian Devi Anand, the widow

of deceased Wasti Ram, was substituted in place of Wasti Ram on

the application

of the landlord. The Rent Control Tribunal

allowed the cross-objection of the tenant and held that there was no

default on tbe part

of the tenant in the matter of payment of rent.

The Rent Control Tribunal rejected the first contention of the

landlord in the Landlord's Appeal regarding substantial damage done

to the property by the tenant.

On the other question, namely, the

question

of sub-letting, the Rent Control Tribunal allowed the

appeal of the landlord and remanded the case to the Rent Controller

to decide the question of

sub· letting after affording an opportunity

to the parties to lead evidence

in this regard.

Against the order

of the Rent Control Tribunal,

Smt. Gian

Devi Anand, the widow

of the deceased tenant,

filed an appeal

in the High Court impleading

in the said appeal the other heirs of

Wasti Ram as

pro·forma respondents. The landlord also filed a

cross-objection in the High Court after the widow had presented the

appeal against the order

of the Rent Control Tribunal directing

remand on the question

of sub-letting. In the cross·objection filed

by the landlord, the landlord bad challenged the finding of the

Tribunal on the question

of non-payment of rent and had further

raised a contention that view

of the death of the original tenant

Wasti Ram,

who continued to remain in possession of the shop as

a statutory tenant, the widow and the heirs of the deceased tenant

were not entitled to continue to remain in occuption thereof. The

High Court

held that on the death of the statutory tenant, the heirs

SUAAl!ME COURT RllPOll.TS (1984] 1 s.c.a.

of the statutory tenant had no right to remain in possession of the

premises, as statutory tenancy

was not heritable and the protection

afforded to a statutory tenant

by the Act is not available to the heirs

and

legal representatives of the statutory tenant. In this view of the

matter the

B:igh Court did not consider it necessary to go into

other questions and the High Court allowed the cross-objection

filed

by the landlord and passed a decree for eviction against lhe appellant

and the other heirs

of W asti Ram, the deceased tenant.

The correctness

of this view that on the death of a tenant

whose tenancy in respect

of any commercial premises has been

terminated during this life time, whether before the commencement

of any eviction proceeding against him or during the pendency of

any eviction proceeding against him, the heirs of the deceased tenant

do do not enjoy the protection afforded

by the Act to the tenant and

they

do not have any right to continue to remain in possession

because they do not inherit the tenancy rights

of the deceased tenant,

is challenged in this appeal.

The learned counsel for the appellant-tenant argues that there

could be no doubt that a contractual tenancy

is heritable and he

contends that notwithstanding the termination

of the contractual

tenancy

of the

tena:it in respect of any commercial premises, the

position iu

law remains unchanged in so far as the tenancy in respect

of commercial premises is concerned, the virtue of the provisions of

the Act. In support of this contention reference is made to the

provisions

of the Act and strong reliance is placed on the decision

of this court in the case of Damadi Lal &

Ors. v. Parashram &

Ors.(') and also to the decision of this Court in the case of

V. Dhanapal Chettiar v. Yesodai Ammal.('J.

The learned counsel appearing on behalf of the landlord

respondents have submitted that on the determination of the con·

tractual tenancy, the tenancy comes to an end and the tenant ceases

to have any estate or interest in the premises. It is contended

that

on determination of the tenancy, the tenant becomes

liable to be evicted in due process

of law under the general law of

the land; but, the Act affoads a protection to the tenant against such

evictiod in as the Act provides that inspite

of the termination of

(!) [1976] Supp. S.C.R.

24S.

(2) [1977] l S.C.R. 334.

GIAN DEVI ANAND v. JEBVAN KUMAR (A.N. Sen, J.) 13

the tenancy, no order or decree for procession shall he passed

against the tenant, unless any

of the grounds mentioned in the Act

which entitles a landlord to recover possession

of the premises from

the tenant

is established. It is contended that the protection to the

tenant under the Act

is against eviction except on grounds recog

nised

by the Act and the protection is only in the nature of personal

protection to the tenant who continues to remain in possession after

the termination

of the tenancy. The contention is that the tenant

loses the estate or interest in the tenanted premises after termination

of the contractual tenancy and the tenant by virtue of the Act is

afforded only a personal protection against eviction; and, therefore,

the heirs

of such tenant on his death acquire no interest or estate

in the premises, because the deceased tenant had none, and they can

also claim no protection against eviction, as the protection under

the Act is personal to the tenant as long

as the tenant continues

to remain in possession

of the premises after the termination of the

tenancy. The argument, in short,

is that the protection against

eviction after termination

of tenancy afforded to a tenant by the Act

creates a personal right in favour

of the tenant who continues to

remain in possession after termination

of his tenancy without any

estate or interest in the premises; and, therefore, on the death

such a tenant, his heirs who have neither any estate nor interest in

the tenanted premises and who do not have any protection under

the

Act against eviction, are liable to be evicted as a matter of

course under the ordinary Law of the land. In support of this

argument various authorities including decisions

of this Court, of

various High Courts, of English Courts and also passages from

Halsburys" Laws of England and other eminent English authors have

been cited.

It has been further argued that in view of the clear provision

in law that heirs

of a deceased tenant whose tenancy had been termi

nate!! during his life time and who was continuing in possession

by virtue

of the provisions of the Act did not enjoy any protection

and was liable to be evicted

as a matter of course, the Legislature

considered it

fit to intarvene to give some relief to the heirs of the

deceased tenant in respect

of the residential

premises and amended

the Act

of 1958 by Delhi Rent Control (Amendment) Act, 1976

(Act 18 of 1976) by changing the definition of 'tenant' with retros

pective effect. The argument

is that by virtue of the amendment

introduced in

1976 with retrospective effect, the heirs of the deceased

tenant specified

in s. 2 (iii) enjoy the protection against eviction

14 SUPREME COURT REPORTS (1985] SUPPL. s.c.R.

during their life time in the manner mentioned therein, provided the

conditions mentioned therein are satisfied, only with regard to resi

dential premises. It is contended that with regard to the residential

premises such limited protection essentially personal to the heirs

specified and to

be enjoyed by them for their lives in the manner laid

down in the said sub-section 2

(1) (iii) has been provided by the

amendment; but in respect

of commercial premises 'no such protection

has been given.

We do not consider it necessary to refer to the various

English cases and the other English authorities cited from the Bar.

The English cases and the other authorities turn on the provisions

of the English Rent Acts. The provisions of the English Rent Acts

are not in

pari materia with the provisions of the Act in question or

the other Rent Acts prevailing in other States in India. The English

Rent Acts which have come into existence from time to time

were

no doubt introduced for the benefit of the tenants. It may be noted

that the term

"statutory tenant" which is not to be found in the

Act in question or in the other analogous Rent Acts

in force in other

States in India,

is indeed a creature of the English Rent Act. English

Rent Act.

1977 which was enacted to consolidate the Rent Act 1968,

parts III,

lV and VIII of the Housing Finance Act, 1972, the Rent

Act

1974, sections 7 to

10 of the Housing Rents and Subsidies Act

1975 and certain related enactments, witw amendments to give effect

to recommendation of the Law Commission, speaks of protected

tenants and tenancies in S. I and defines statutory tenant in S. 2,

English Rent Act, 1977 is in the nature of a complete Code governing

the rights and obligations

of the landlord and the tenant and their

relationship in respect

of tenancies covered by the Act. As the

provisions

of the English Act are materially different from the

provi

sions of the Act in question and other Rent Control Acts in force

in other States in India, the decisions of the Engli;h Courts and the

passages from the various amhoritativc books including the passages

from Halsbury which are all concerned with English Rent Acts are

not

of any

particular assistance in deciding the question involved in

this appeal. As we have already noticed, the term 'statutory

tenant'

is used in English Rent Act and !bough this term is not be

found in the Indian Acts, in the Judgments of this Court and also of

the various High Courts in India, this term has often been used to

denote a tenant whose contractual tenancy has been terminated but

who has become entitled to continue to remain in possession

virtue of the protection afforded to him by the statutes in question,

GIAN DEVI ANAND v. JEEVAN KUMAR (A.N. Sen, J.) 15

namely, the various Rent Control Acts, prevailing in different States

of India. 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 possessiorr 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

1 or evictions 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.

As various decisions

of this Court on which reliance has

been placed by the learned counsel for the Landlord have been cited,

it does

not become very necessary to consider at any length the

various decisions

of the High Courts on the very same question,

relied on

by the Learned Counsel for the landlords. It may, however,

be noted that the decisions of this Court to which we shall refer in

due course and the decisions of the High Courts which were cited

by the learned counsel for the Landlordi do lend support to their

contention.

We first propose to deal with the decision of his Court in

Damadi/a/'s case (supra) in which this Court considered some of the

English Authorities and also some

of the decisions of this Court. In

this case the first question raised on

behelf of the plaintiff-appellant

in this Court was whether the heirs

of the statutory tenants had any

heritable interest

in the demised premises and had the right to

prosecute the appeal in the High Court on the death of the statutory

tenant.

654:

Dealing with this contention the Court held at pages

650 to

"In illlpport of his first contention Mr. Gupta relied

on two decisions

of this Court, Anand Nivas (Private)

}<'

Ltd. v. Anandji Ka/yanji Pedhi & Ors(

) and Jagdish G ·

Chander Cllatteriee & Ors. v. Sri Kishan & Anr.C). The

statute considered in

Anand

Nivas(

) case was Bombay

Rents, Hotel and Lodging Rates Control Act,

1947 as

amended in 1959. The question there was, whether a

tenant whose tenancy had been terminated had any right

(1) [1973] 4 S.C.ll. 892.

(2) (1973] 1 S.C R. 850,

16 SUPR.EME COURT R.EPORTS [1985) SUPPL. s.c.11..

to sublet the premises. Of the three learned Judges

composing the Bench that heard the appeal, Hidayatullah

and Shah,

JJ. held that a statulory tenant, meaning a

tenant whose tenancy has determined but who continues

in possesion, has no power

of subletting. Sarkar

delivered a dissenting opinion. Shah J. who spoke for

himself and Hidayatullah

J. observed in the course of

their judgment :

'A statutory tenant has no interest in the premises

occupied by him, and ne has no estate to assign or

transfer. A statutory tenant is, as

we have already

observed, a person who on determination

of his

con

tractual right, is permitted to remain in occupation so

long as he observes and performs the conditions of the

tenancy and pays the standard rent and permitted

increases. His personal right

of occupation is incapable

of being transferred or assigned, and he having no

interest in the property there

is no estate on which

subletting may operate.'

It appears from the judgment of

Shah, J. that 'the

Bombay Act merely grants conditional protection to a

statutory tenant and does not invest him with the right

to enforce the benefit

of any of the terms and conditions

the original tenancy'. Sarkar,

dissenting· held that

word 'tenant' as defined

in the Act included both a

contractual

tenant-a tenant whose lease is subsisting as

also a statutory tenant and the latter has the same power

to sublet as the former. According to

Sarkar, J. even if

a statutory tenant had no estate or property in the

demised premises, the Act had undoubtedly created a

right in such a tenant in respect

of the property which he

could transfer.

Jagdish Chander Chatterjee's case dealt

with the Rajasthan Premises (Control

of Rent and

Eviction) Act,

1950, a!ld the question for decision was

whether on the death

of a statutory tenant his heirs

succeed to the tenancy

so as to claim protection of the

Act.

In this case it was .held by Grover and

Palekar JJ.,

relying on

Anand Nivas's

~ase, that after the termination

of contractual tenancy, a statutory tenant enjoys only a

personal right to continue in possession and on his death

•

• ,

GIAN DEVI ANAND v. JllEVAN KUMAR (A.N. Sen, J.) 17

his heirs do not inherit any estate or interest in the

original tenancy.

Both these cases,

Anand

Nivas and Jagdish Chander

Chatterjee, proceed on the basis that a tenant whose

tenancy has been terminated, described

as statutory

tenant, has

no estate or interest in the premises but only

a personal right to remain in occupation.

It would seem

as if there is a distinct category of tenants called statutory

tenants having separate and

fixed incidents of tenancy.

The term 'statutory tenancy'

is borrowed from the English

Rent Acts. This may

be a convenient expression for

referring to a tenant whose tenancy has been terminated

and

who would be liable to be evicted but for the

pro

tecting statute, but courts in this country have sometimes

borrowed along with the expression certain notions

reg~rding such tenancy from the derisions of the English

Courts.

In our opinion it has to be ascertained how far

these notions are reconcilable with the provisions

of the

statute under consideration

in any particular case. The

expression 'statutory tenancy'

was used in England in

several judgments under the Increase of Rent and

Mort

gage interest (War Restrictions) Act, 1915, to refer

to a tenant protected under that Act, but the term got

currency from the marginal note to section

15 of the

Rent and Mortgage Interest (Restriction) Act,

1920.

That section which provided inter a/ia that a tenant who

by virtue of that Act retained possession of any dwelling

house to which the Act applied, so long

as he retained

possession, must observe and would

be entitled to the

benefit

of all the terms and conditions of the original

contract

of tenancy which were consistent with the

provisions

of the Act, carried the description in the

margin 'conditions of statutory tenancy'. Since then the

term has

been used m England

to describe a tenant

protected under the subsequent statutes until Section

49(1) of the Housing Repairs and Rent Act, 1954 for the

first time

define 'statutory tenant' and 'statutory tenancy'.

'Statutory Tenant'

was defined as a tenant 'who retains

possession

by virtue of the Rent Acts and not as being

entitled to a tenancy' and it

was added, 'statutory

SUPREME COURT REPORTS [1985] SUPPL. s.c.R.

tenancy' shall be construed accordingly.' This definition

of 'statutory tenancy' has been incorporated in the Rent

Acts

of 1957 and 1965. In England 'statutory tenancy'

does

not appear to have had any clear and fixed

incidents; the concept was developed over the years from

the provisions

of the successive Rent Restrictions Act

which did not contain a clear indication as to the

charac

ter of such tenancy. That a statutory tenant is entitled

to the benefit of the terms and conditions of the original

contract

of tenancy so far as they were consistent with

the provisions

of the statute did not as Scrutton L.J.

observed in

Roe v. Russell(') 'help very much when one

came

to the practical facts of life', according to him

'citizens are entitled to. complain that their legislators did

not address their minds

to the probable events that might

happen in cases

of statutory

·tenancy, and consider bow

the legal interest they were granting was affected by

those probable events'. He added, '. .. it is pretty evident

that the Legislature never considered as a whole the

effect

on the statutory tenancy of such ordinary incidents

as death, bank-ruptcy, voluntary assignment, either

inter

vivas or by will, a total or partial sub-letting; but from

time

to time put into one of the series of Acts a

provi

sion as to one of the incidents without considering bow

it fitted in with the general nature

of the tenancy which

those incidents might affect.'

On the provisions which

gave no clear and comprehensive idea

of the nature of

statutory tenancy, the courts in England had been

slowly 'trying to frame a consistent theory (

)' making

bricks with very insufficient statutory

straw'(') Evershed

M.R. in

Boyer v. Warbey

(

) said: 'The character of the

statutory tenancy, I have already said, is a very special

one.

It has earned many epithets, including 'monstrum

horrendum' and perhaps it has never been fully thought

out by Parliament'. Courts in England have held that a

statutory tenant has no estate or property in the premises

he occupies because he retains possession by virtue of the

(I) [1928]2 K.B, 117.

(2) Scrutton L.J in Haskins v. Lewis [193512 K.B. 1(9)

(3)

Scrutton L.J. in Keeves

v, Dean (1923] L.J.K.JI. 203 (207),

(4) (195312 K.B. 234.

•

GIAN DEVI ANAND v. JEEVAN KUMAR (A.N. Sen, J.) 19

Rent Acts and not as being entitled to a tenancy; it has

been. said that he has only a personal right to remain in

occupation, the statutory right

of 'irremovability', and

nothing more.

We find it difficult to appreciate how in

thh country

we can proceed on the basis that a tenant whose contra

ctual tenancy has determined but who is protected

against eviction

by the statute, has no right of property

but only a personal right to remain

in occupation,

with

out ascertaining what his rights are under the statute.

Th!' concept of a statutory tenant having no estate or

property in the premises which he occupies is derived

from the provisions of the English Rent Acts. But it

not clear how it can be assumed that the position is the

same

in this coutry without any reference to the

provi

·sions of the relevant statute. Tenancy has its origin in

contract. There

is no dispute that a contractual tenant

has an estate or property in the subject matter

of the

tenancy, and heritability

is an incident of the tenancy.

It cannot be assumed, however, that with the

determina

tion of the tenancy the estate must necessarily disappear

and the statute can only preserve his status

irremova

bility and not the estate he had in the premises in his

occupation.

It is not possible to claim that the 'sanctity'

of contract cannot be touched by legislation. It is

there

fore necessary to examine the provisions of the Madhya

Pradesh Accommodation Control Act, 1961 to find out

whether

the respondents' predecessors-in-interest retained

a heritable interest in

the disputed premises even after

the termination

of their tenancy.

Section 2(i) of the Madhya Pradesh Accommodation

Control Act 1961 defines 'tenant' to mean, unless the

context otherwise requires :

'a person by whom or on whose account or

behalf the rent

of any accommodation is, or, but for

a contract express or implied would be payable for

any accommodation and includes any person

occupy

ing the accommodation as a sub-tenant and also any

person continuing in possession after the termina

tion of his tenancy whether before or after thq

-F

SUPREME COURT REPORTS (1985) SUPPL. s.c.R.

commencement" of this Act; but shall not include

any person against whom any order or decree for

eviction has been made'.

The definition makes a person continuing in

possession after the determination

of his tenancy a

tenant unless a decree or order for eviction has been

made against him, thus putting him on par with a

person whose contractual tenancy still subsists. The

incidents of such tenancy and a contractual. tenancy

must therefore be the same unless any provision

the Act conveyed a contrary intention. That under

this Act such a tenant retains an interest in the

premises, and not

merely a personal right of

occupa

tion, will also appear from section 14 which contains

provisions restricting the tenant's power

of subletting.

Section

14 is in these terms :

'Sec.

14 Restriction on sub-Jetting.-(!) No

tenant shall without the previous consent

writing of the landlord.-

(a) sublet the whole or any part of the

acco

mmodation held by him as a tenant : or

(b) transfer or assign bis rights in the tenancy

in any part thereof.

(2) No landlord shall chim or receive the

payment

of any sum as premium or pugree or

claim or receive any consideration whatsoever

in cash or in kind for giving bis consent to the

sub-letting

of the whole or any part of the

accommodation held

by the tenant'.

There is nothing to suggest that this section does not

apply to

all tenants as defined in Section 2(i). A

contra

ctual teiiant bas an estate or interest in premises from

which be carves out what he

gives to the sub-tenant.

Section

14 read with section 2 (i) makes it clear that the

so called statutory tenant has the right to sub-let in

~omjllon wjth a contractual tenant and this i$ because he

OiAN DEVI ANANb v. iEEVAN KUM•R (A.N. Sen,/.) 21

also has an interest in the premises occupied by

him."

It may be noted that in deciding Damadila/'s case (supra),

this Court considered the

two decisions of this Court, namely, the

decisions in

Anand Nivas and Jagdish Chander Chatterjee's cases

(supra) which have been relied on

by the learned counsel for the

landlords.

The decision

of this Court in the case of Ganpat Ladha v.

Sashikant Vishnu Shinde(

)

is another decision on which very strong

reliance has been placed on behalf

of the landlords. In this case

under Bombay Rents, Hotel and Lodging House Rates Control Act,

1947, the Court was concerned with the question whether the heirs

of deceased tenant whose tenancy has been determined and against

whom eviction proceeding

was pending, were entitled to the benefit

of protection afforded to the tenant after the determination of the

tenancy in respect

of the business premises. This Court noticed at

page

202 that the tenancy right was being claimed under S. 5(11) (c)

of the said Act which, as recorded in the judgment, is in the follow

ing terms :

"5(1l)(c) : 'tenant' means any person by whom

or on whose account rent

is payable for any premises and

includes-

(a)

(b)

him at the time

of his death as may be decided

in default

of agreement by the

Court."

While dealing with this question, this Court held at pp. 202-204 :

"In these circumstances, the question arose for

decision whether the present respondent, whose residence

is given in the special leave petition as 'Agakhan

Building,

Haines Road, Bombay', could po;sibly claim to H

(I) [1978) 3 S.C.R. 198.

22 SUPREME COURT REPORTS [1985) SUPPL. s.c.R.

be a tenant in respect of the shop which admittedly

constitutes business premises

by reason of

Section

5(11} (c} of the Act. The High Court took the view

that section 5(11) (c} applies not only to residential

premises but also to business premises and therefore, on

the death of a tenant

of business premises, any member

of tenant's family residing with him at the time of bis

death would become a tenant.

We do not think this

view taken by the High Court is correct.

It is difficult

see how in case of business premises, the need for

showing residence with the original tenant at the time

of bis death would be relevant. It

is obvious from the

language of Section 5(11) (c) that the intention of the

legislature

in giving protection to a member of the family

of the tenant residing with him at the time of his death

was to secure that on the death of the tenant, the

member

of his family residing with him at the time of

his death is not thrown out and this protection would be

necessarily only in case of

residenti~l premises. When

a tenant

is .in occupation of business premises, there

would be no question

of protecting against dispossession

a member

of the tenant's family residing with him at the

time

of death. The tenant may be carrying on a business

in which

the member of his family residing with him may

not have any interest at all and yet on the construction

adopted

by the High Court, such member of the family

would become a tenant in respect

of the business

premises.

Such a result could not have been intended

to be brought about by the legislature.

It is difficult to

discern any public policy which might

seem to require it.

The principle behind section

5(11) (c) seems to be that

when a tenant

is in occupation of premises, the tenancy

is taken by him not only for his own benefit, but also

for the benefit of the members of the family residing with

him and, therefore, when the tenant dies, protection

should be extended to the members of the family who

were participants in the benefit of the tenancy and for

whose needs inter alia the tenancy was originally taken

by the tenant. This principle underlying the enactment

of section 5(11) (c} also goes to indicate that it

is in respect of residential premises that the protection

•

GIAN DEVI ANAND v. JEBVAN KUMAR (A.N. Sen, J.)

of that section is intended to be given. We can

appreciate a provision being made

in respect of

business premises that on the death of a tenant in

respect

of such premises, any member of the tenant's

family carrying on business with the tenant in such

premises at the time

of his death shall be a tenant and

the protection of the Rent Act shall

be available to him.

But

we fail to see the purpose the legislature could have

had in

view in according protection in respect of business

premises to a member

of the tenant's family residing with

him at the time of his death. The basic postulate of the

protection under the Rent Act

is that the person who is

sought to

be protected must be in possession of the

premises and bis possession is protected

by the legisla

tion. But in case of business premises, a member

of the

family

of the tenant residing with him at the time of his

death may not

be in possession of the business premises;

be may be in service or he may be carrying on any other

business. And yet on the

view taken by the High Court,

he would become tenant in respect

of the business

premises with which

he has no connection. We are,

therefore,

in agreement with the view taken by one of us

(Bhagwati J.) in the Gujarat High Court about the

correct meaning

of Section 5(11) (c) in Perupai Manila/

Brahmin

& Ors. v. Baldevdas Zaverbhai Tapodhan(')

in preference to the view adopted in the subsequent

decision

of the Gujarat High Court in Heirs of deceased

Darji Mohan/al Lavji

v. Muktabai Shamji(

)

which

decision

was followed by the Bombay High Court in the

judgment impugned in the present appeals before

us."

This decision proceeds entirely on the construction of

S.5(1 J)(c)(i) and it does not appear that the case of Damadila/

(supra) which also was in respect of commercial premises was cited

before this Court or

was considered by the Court while deciding

this case. Section 5(11)(b) and Section 5(1l)(c)(ii)

were also not

discussed.

(I) 11964] 5 Guj, LR 563.

(2) [1971112 Guj. LR 272.

SUPREME COURT REPOltTS (1984) SUPPL S.C. R.

The aforesaid decisions indicate that there is a divergence of

opinion in this Court on the question whether the heirs of a deceased

tenant whose contractual tenancy in respect of commercial premises

•

has been determined, can inherit the tenancy rights of the deceased

tenant and can claim the benefit and protection to which the deceased

tenant was entitled nnder the Act.

For an appreciation

of the question it is necessary to

understand the kind

of protection that is sought to be afforded to a

tenant under the Rent Acts and his status after the termination

of the

contractual tenancy under the Rent

Acts. It is not in dispute that

so long as the contractual tenancy remains subsisting, the contractual

tenancy creates haritable rights; and,

on the death of a contractual

tenant, the heirs and

legal representatives step into the position of

the contractual tenant; and, in the same way on the death of a

landlord the heirs and legal representatives

of a landlord become

entitled to

all the rights and privileges of the contractual tenancy

and also come under all the obligations under the contractual tenancy.

A valid termination

of the contractual tenancy puts an end to the

contractual relationship.

On the determination of the contractual

tenancy, the landlord becomes entitled nnder the

law of the

land to recover possession

of the premises from the tenant in

due process of

law and the tenant under the general

law of the land is hardly in a position to resist eviction, once the

contractual tenancy has been duiy determined. Because

of scarcity

of accommodation and gradual high rise in the rents due to various

factors, the landlords were in a position to exploit the situation for

unjustified personal gains to the serious detriment

of the helpless

tenants. Under the circumstances it became imperative for the

legislature to intervene to protect the tenants against harassment

and exploitation

by avaracious landlords and appropriate legislation

came to

be passed in all the

States and Union Territories where the

situation required an interference

by the legislature in this regard. It

is no donbt true that the Rent Acts are essentially meant for the

benefit

of the tenants. It is, however, to be noticed that the Rent

Acts at the same time also seek to safeguard legitimate interests

the landlords. The Rent Acts which are indeed in the nature of

social welfare legislation are intended to protect tenants against

harassment and exploitation

by landlords, safeguarding at the same

time the legitimate interests of the landlords. The Rent Acts seek to

preserve social harmony and promote social justice

by safeguarding

•

O!AN DEVI ANAND v. JEEVAN KUMAR (A.N. Sen, J.) 2~

the interests of the tenants mainly and at the same time protecting

the legitimate interests

of the landlords. Though the purpose of the

various Rent Acts appear to

be the same, namely, to promote

social justice

by affording protection to tenants

against undue

harassment and exploitation

by landlords, providing at the

same time for adequate safeguards

of the legitmate interests

of the landlords, the Rent Acts undoubtedly lean more

in favour of the tenants for whose benefit the Rent Acts are

essentially passed.

It may also be noted that various amendments

have been introduced to the various Rent Acts from time to time

as and when situation

so required for the purpose of mitigating the

hardship

of tenants.

Keeping in

view the main object of Rent

Control Legislation, the

position,

of a tenant whose contractual tenancy has been determined

has to

be understood in the light of the provisions of the Rent Acts.

Though provisions

of all the Rent

Control Acts are not uniform, the

common feature of all the Rent Control Legislation is that a con

tractual tenant on the termination of the contractual tenancy is by

virtue of the provisions of the Rent Acts not liable to be evicted as a

matter

of course under the ordinary law of the land and he is entitled

to remain in possession

even after determination of the contractual

tenancy and no order or decree for eviction

will be passed against a

tenant unless any ground which entitles the landlord to get an order

or decree for possession specified in the Act

is established. In other

words, the common feature

of every Rent Control Act is that it

affords protection to every tenant against eviction despite

termi

nation of tenancy except on grounds recognised by the Act and no

order or decree for eviction shall be passed against the tenant unless

any such ground

is established

to·the satisfaction of the Court.

This Court has very aptly observed in Damadi/a/'s case (supra)

that it cannot

be assumed that with the determination of the tenancy,

the estate must necessarily disappear and the statute can only

preserve the status

of irremovability and not the estate he has in

the premises

in his occupation; and it is not possible to claim that

the sanctity

of contract cannot be touched by legislation. As already

noticed, this Court

Damadi/al'• case (supra) after refe:ring mainly

to the definition

of tenant in

S. 2(i) of the Madhya Pradesh Accom

modation Control Act, 1961 came to the so-called statutory

tenant bad an interest in the premises occupied

by him and the heirs

of the statutory tenant

"had a heritable interest in the premises". A

26 SUPllBME COURT REPORTS (1985) SUPPL. S.C.R.

tenant has been defined in S. 2(1) of the Delhi Rent Control Act,

which reads as follows:·

" 'tenant' means any person by whom or on whose

account

or behalf the rent of any premises is, or, but for

a special contract would

be, payable, and

includes-

(i) a sub-tenant;

(ii) any person continuing in possession after the termi·

nation of his tenancy; and

C (iii) in the event of the death of the person continuing in

possession after the termination of his tenancy,

subject to the order

of succession and conditions

specified respectively, in Explanation l and

Expla·

nation II to this clause, such of the aforesaid

person's-

(a) spouse,

(b) son or daughter, or, where there are both son

and daughter, both of them,

(d) daughter-in-law, being the widow of his

pre

deceased son,

as had been ordinarily living in the premises with such

person

as a member or members of his family upto the

date of his death, but does not include, -

(A) any person against whom an order or decree for

eviction has been made, except where such decree or

order for eviction

is liable to be re-opened under the

proviso to section 3

of the Delhi Rent Control

(Amendment) Act,

1976.

(B) any person to whom a licence, as defined by

section 52 of the Indian Easements Act, 1882 has

been

grantCd.

.....

GIAN DEVI ANAND \', lEEVAN KUMAR (A.N. Sen, J.) 2?

Explanation 1.-The order of succession in the event

of the death

of the person continuing in possession after

the terminatton

of his tenancy shall be as follows.-

(a) firstly, his surviving spouse;

(b) secondly, his son or daughter, or both, if there is no

surviving spouse, or if the surviving spouse did not

ordinarily

live with the deceased person as a member

of his family upto the date

of his death;

son or daughter

of the deceased person, or if such

surviving spouse, son or daughter or any

of them,

·did not ordinarily live in the premises as a member

of the family of the deceased person upto the date

his death; and

(d) fourthly,

his daughter-in-law, being the widow of

his pre-deceased son, if there is no surviving spouse,

son, daughter or parents of the deceased person, or

if such surviving spouse son, daughter or parents, or

any of them, did not ordinarily

live in the premises

as a member

of the family of the deceased person up

to the date

of his death.

Explanation

11.-If the person, who acquires, by

succession, the right to continue in possession after

the termination

of the tenancy, was not financially

dependent on the deceased person on the date

his death, such successor shall acquire such right for

a limited period

of one year; and, on the expiry of

that period, or on his death, whichever is earlier,

the right of such successor to continue in possession

after the termination

of the tenancy shall become

extinguished.

Explanation

III.-For the removal of doubts, it is

hereby declared that,-

(a) where, by reason of Explanation II, the right of

any successor to continue in possession after

SUl'REME C-OURt REPORTS (198~] SUPl'L. $,C.li..

the termination of the tenancy becomes extin·

guished, such extinguishment shall not affect

the right

of any other successor of the same

category to continue in possession after the

termination of the tenancy; but if there

is no

other successor

of the same category, the right

to continue in possession after the termination

of the tenancy shall not, on such extinguishment

pass on to any other successor,

specified in any

lower category or categories,

as the case

may

be;

(b) the right of every successor, referred to in

Explanation I, to continue in possession after

the termination

of the tenancy, shall he personal

to him and shall not,

on the

death of such

successor, devolve on any of

his heirs

D The definition of tenant as it stands at present in the Act, is after

the amendment

of the definition in S. 2(1) of the earlier Act, by the

Amendment Act (Act

18 of 1976) which was introduced with

retros

pective effect. Prior to the amendment, the definition of tenant as

it stood in the original Act,

1958 was in the following terms:-

" 'tenant' means any person by whom or on whose

account or behalf the rent of any premises is, or, but for

a special contract would be, payable and includes a sub

tenant and also any person continuing in possession after

the termination

of his tenancy but shall not include any

person against whom any

Order or decree for eviction

have been

made".

It is, therefore, clear from the definition of tenant, whether in the

original Act or in the amended Act, that the tenant within the

meaning

of the definition of the term in the Act includes any person

continuing

in possession after the termination of his tenancy. It

will be

seen that the definition of tenant in Madhya Pradesh

Accommodation Control Act, 1961 on which the decision in

Domodilal's case (supra) mainly turns, is similar to the definition

of tenant as given in the Delhi Act in the sense that the tenant

under both the Acts includes for the purpose

of the Rent Act any

person continuing in possession after the termination

of the

tenancy.

. -

GIAN DEVI ANAND Y. JEBVAN KUMAR (A.N. Sen, J.) 29

The other section of the M.P. Accommodation Control Act

1961 considered by this Court in deciding Damadilal's case (supra)

was section 14 which deals with sub-letting and this Court held that

there

was nothing in that section to suggest that the section would

not apply to all tenants

as defined in section 2(

I) of the said Act.

S.14 was considered in Damadilal's case (supra) to ascertain whether

the 'so called statutory tenant' enjoyed the same right

as the

contra•

ctual tenant in the matter of sub-letting and this Court held that the

'so called statutory tenant' enjoyed the same right as the contractual

tenant.

Let

us now analyse the provisions of the Delhi Act to find out

whether there is anything in the other provisions to indicate that the

tenant

as defined in

S. 2(1)(ii) will stand on any different footing

from a contractual tenant in the matter

of enjoyment of the

protec·

lion and benefits sought to be conferred on a tenant by the Act.

S. 2(e) defines landlord and clearly indicates that the landlord

continues to

be tbe landlord for the purpose of the Act even after

termination of the contractual tenancy.

S. 2(1) which defines 'tenant'

has been set out earlier

in its entirety. We

shall consider the true

effect of S. 2{J)(iii) on which as earlier noted, reliance has been

placed

by the learned counsel of the landlords, when we deal with

the argument which has

been advanced on the basis of this

sub

section. Section 3 mentions premises which are outside the purview

of this Act and has no bearing on the question involved. Chapter II

of the Act consists of Sections 4 to 13 and makes provision regard

ing rent. These sections indicate that they are applicable to tenants

as defined in S. 2(1) including 2(l)(iii). Chapter III consists of

sections 14 to 25 of the Act and deals with eviction and control of

eviction of tenants. S. 14 starts as follows :-

"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 of the landlord against

a tenant ;

...........................

..... ... .. . ...... ... ......

...

30 SUPREME COURT REPORTS [1985) SUPPL. s.c.R.

Thereafter various provisions are made as . to grounds and under

what circumstances a decree for eviction

may be passed. This

section, therefore, clearly postulates that despite the termination

the tenancy and notwithstanding the provisions of any other law

which might have been applicable on the termination of the

contra·

ctual tenancy, protection against eviction is applicable to every

tenant as

defined in

S. 2(1) of the Act. This section clearly establi·

shes that determination of a contractual tenancy does not disqualify

him from continuing to

be a tenant within the meaning of this Act .

and the tenant

whose contractual tenancy has been determined

enjoys the same position and

is entitled to protectiou against

eviction. The other sections in this chapter also

go to indicate that

the tenant whose tenancy has been terminated enjoys the same

status and benefit as a tenant whose tenancy has not been

termina·

ted, and a tenant after termination of his tenancy stands on the

same footing as the tenant before such termination. Chapter III A

which provides for summary trial for certain applications also does

not make any distinction between a tenant

whose tenancy has been

determined and a tenant

whose tenancy had not been terminated.

Chagter IV which deals with deposit of rent consists of sections 26

to 29 and these sections make it clear that the tenant after deter·

mination of a tenancy is treated under the Act on the same footing

as a ienant whose tenancy has not been determined. Chapter V

which consists

of sections

30 to 34 deals with hotels and lodging

houses and does not

have any relevance to the question involved.

Chapter

VI which consists of sections 35 to 43 provides for

appoint·

ment of Controllers and their powers and functions and also makes

provisions with regard to appeals. This chapter though not

very

material for the purpose of adjudication of the point involved

indicates that

no discrimination is made in the matter of proceedings

for eviction between the 'so called statutory tenant' and a

contra·

ctual tenant. Chapter VII which consists of sections 44 to 49

makes provisions regarding obligations of landlords and also pro

vides for penalties in appropriate cases. The sections make it clear

that the duties and obligations cast

upo.1 the landlord apply equally

whether the tenant

is a so called 'statutory tenant' or the tenant is a

contractual tenant. Chapter VIII which makes various

misce!lane·

ous provisions does not have any bearing on the question involved.

It may, however, be noted that section 50 which bars the jurisdiction

of Civil Courts in respect of certain matters does not in any way

discriminate between a 'so called statutory tenant' and a contractual

tenant. The provisions

of the Act, therefore, make it abundantly

. -..

GIAN DEVI ANAND v. JEEVAN KUMAR (A.N. Sen, J.) 31

clear that the Act does not make any distinction between a 'so

called statutory tenant' and a contractual tenant and the Act

proceeds to treat both alike and to preserve and protect the status

and rights

of a tenant after determination of the contractual tenancy

in the same way

as the status and rights of a contractual tenant are

protected and preserved.

While on this question it

will be appropriate to quote the

following observations

of this Court in the case of

V. Dhanapa/

Chettiar v. Yesodai Ammal (supra) at 340 :-

"Once the liability to be evicted is incurred by the

tenant, he

'Cannot turn round and say that the

contrac·

tual lease has not been determined. The action of the

landlord in instituting a snit for eviction on the ground

mentioned in

any

State Rent Act will be tantamount to

an expression

of his intention that he does not want the

tenant to continue

as his lessee and the jural relationship

of lessor and lessee will come to an end on the passing

of an order or a decree for eviction.

Until then, under

the extended definition

of the word 'tenant' under the

various

State Rent Acts, the tenant continues to be a

tenant even though the contractual tenancy has

been

determined by giving a valid notice under section

106 of

the Transfer of Property Act. In many cases the distinc

tion between a contractual tenant and a statutory tenant

was alluded to for the purpose of elucidating some parti

cular aspects which cropped up in a particular case.

That

led to the criticism of that expression in some of

the decisions. Without detaining ourselves on this

aspect

of the matter by any elaborate discussion, in our

opinion, it

will suffice to say that the various

State Rent

Control Acts make a serious encroachment

in the field . of freedom of contract. It does not permit the landlord

to snap bis relationship with the tenant merely

by his

Act

of serving a notice to quit on him. Inspite of the

notice, the

law says that be continues to be a tenant and

and he does so enjoying all the rights

of a lessee and is

at the same time deemed to be under all the liabilities

such

as payment of rent etc. in accordance with the

law."

These observations were made by a seven-Judge Bench of this

Court. It

is no doubt true that

these observations were made while

32 SUPREME COURT REPORTS [1985) SUPPL. s.c.R.

considering the question of requirement of a notice under section 106

of the Transfer of Property Act before the institution of suit for

recovery

of possession of premises to which the Rent Act applies.

These observations, however, clearly

go to establish that mere

deter·

mination of the contractual tenancy does not in any way bring

about any change in the status

of a tenant. As aptly observed in

this decision,

"it will suffice to say that the various State Rent

Coutrol

Acts make a serious encroachment in the field of freedom

of contract. It does not permit the landlord to snap his relationship

with the tenant merely

by his act of serving a notice to quit on him.

Inspite of the notice, the law says that he continues to be a tenant

and

he does so, enjoying all the rights of a lessee and is at the same

time deemed to be under all the liabilities such as payment of rent

etc. in accordance with the

law."

We now proceed to deal with the further argument advanced

on behalf of the landlords that the amendment to the definition

'tenant' with retrospective effect introduced by the Delhi Rent

Control Amendment Act (Act

18 of 1976) to give personal protection

and personal sight

of continuing in possession to the heirs of the

deceased statutory tenant in respect

of residential premises only and

not with regard to the heirs

of the 'so called statutory tenant' in

respect

of commercial premises, indicates that the heirs of so called

statutory tenants, therefore,

do not enjoy any protection under the

Act. This argnment proceeds on the basis that in the absence

any specific right created in favour of the 'so called statutory tenant'

in respect of his tenancy, the

heir~ of the statutory tenant who do

not acquire any interest or estate in the tenanted premises, become

liable to be evicted

as a matter of course. The very premise on the

basis

of which the argument is advanced is, in our opinion, unsound.

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

termi·

nation of the contractual tenancy continues to enjoy creates a

heritable interest in the absence

of any provision to the contrary.

We have earlier noticed the decision of this Court in Damadi/al's

case (supra). This view has been taken by this Court in Damadi/al's

case and in our opinion this decision represents the correct position

< -

GIAN DEVI ANAND V, JEEVAN KUMAR (A.N.Sen, J.) 33

in law. The observations of this Court in the decision of the Seven

Judge Bench in the case of V. Dhanapa/ Chtttiar v. Yesodai Ammal

(supra) which we have earlier quoted appear to conclude the question.

The amendment

of the definition of tenant by the Act 18 of 1976

introducing particularly

2(1 )(iii) does not in any way mitigate against

this view. The said sub-section (iii) with all the three Explanations

thereto

is not in any way inconsistent with or contrary to sub

section (ii)

of Section 2(1) which unequivocally states that tenant

includes any person continuing in possession after the termination

of his tenancy. In the absence of the provision contained in

'sub

section 2(l)(iii). the heritable interest of the heirs of the statutory

tenant would devolve on all the heirs

of the 'so called statutory

tenant' on bis death and the heirs

of such tenant would in law step

into his position. This sub-section (iii)

S. 2(1) seeks to restrict

this right in so far as the residential premises are concerned. The

heritability

of the statutory tenancy which otherwise flows from the

Act

is restricted in case of residential premises only to the heirs

mentioned in

S 2(l)[iii) and the heirs therein are entitled to remain

in possession and to enjoy the protection under the Act in the

manner

and to the extent indicated in sub-section 2(1)(iii). The

legislature, which under the Rent Act affords protection against

eviction to tenants whose tenancies have been terminated and who

continue

to remain in possession and who are generally termed as

statutory tenants,

is perfectly competent to lay down the manner and

extent of the protection and the rights and obligations

of such tenants

and their heirs.

S. 2(1)(ii1) of the Act does not create any additional

or special right in favour of the heirs of the 'so called statutory tenant'

on his death, but seeks to restrict the right

of the heirs of such tenant

in respect

of residential premises. As the status and rights of a

contractual tenant even after determination

of bis tenancy when the

tenant

is at times described as the statutory tenant, are fully

protected by the Act and the heirs

of such tenants become entitled

by virtue

of the provisions of the Act to inherit the status and

position

of the statutory tenant on his death, the legislature which

bas created this right has thought it fit in the case

of residential

premises

to limit the rights of the heirs in the manner and to the

extent provided in

S. 2(1)<iii). It appears that the legislature has

not thought it fit to put any such restrictions with regard to tenants

in respect

of commercial premises in this Act.

It may be noted that for certain purposes the legislature in the

Delhi Act in question and also in various other Rent Acts bas treated

SUPREME COURT REPORTS [1985] SUPPL. ~.C.R.

commercial premises differently from residential premises S. 14(J)(d)

provides that it

will be a good ground for eviction of a tenant from

residential premises,

if the premises let out for use as residence is

not so used for a period of six months immediately before the filing

of the application for the recovery of possession of the

premises.

Similarly S. 14(J)(e) makes bonafide requirement

of the landlord of the premises let out to the tenant for residential

purposes a good ground for eviction

of the tenant from such

premises. These grounds, however, are not made available in

respect

of commercial premises.

We find it difficult to agree with the observations which we

have quoted earlier made by this Court in the case of Ganapat Ladha

v. Sashi Kant Vishnu

Shinde (supra).

It may be noticed that the Legislature itself treats commercial

tenancy differently from residential tenancy

in the matter of eviction

of the tenant in the Delhi Rent Act and also in various other Rent

Acts. All the grounds for eviction

of a tenant of residential

pre

mises are not made grounds for eviction of a tenant in respect of

commercial premises. S. 14(1 )(d) of the Delhi Rent Act provides

that non-user

of the residential premises by the tenant for a period

of six months immediately before the filing of the application for the

recovery

of possession of the premises will be a good ground for

eviction, though in case

of a commercial premises no such

provision is made.

Similarly,

S. 14(t)(e) which makes bona

fide requirement of the landlord of the premises let out to

the tenant for residential purposes a ground for eviction

the tenant, is not made applicable to commercial premises. A

tenant

of any commercial premises has necessarily to use the

premises for business purposes. Business carried on by a tenant

of any commercial premises may be and often is, his only occupation

and the source

of livelihood of the tenant and bis family.

Out of

the income earned by the tenant from his business in the commercial

premises, the tenant maintains himself and bis family; and the

tenant, if he is residing in a tenanted house, may also be paying his

rent out

of the said income. Even if tenant is evicted from his

residential premises, he may with the earnings out

of the business

in a position to arrange for some other accommodation for bis

residence with his family. When, however, a tenant is thrown out

of the commercial premises, his business which enables him to

maintain himself and his family comes to a stand-still.

It is common

GIAN DEVI ANAND v. ]E<VAN KUMAR (A.N. Sen, J.) 35

knowledge that it is much more difficult to find suitable business

'.'remises than to find suitable premises for residence. It is no

secret that for securing commercial accommodation, large sums' of

money by way of salami, even though not legally payable, may have

to be paid and rents

of commercial premises are usually' very high.

Besides,' a business which has been carried on for years

at a

parti·

cular place has its own goodwill and other distinct advantages. The

death of the person. who happens to be the tenant of the com·

mercial premises and who · was running the business out of the

income

of which the family used to be maintained, is itself a great

loss to the members

of the family to' whom the death, naturally,

comes as a great blow.

·Usually; on the death of the person \vho

runs the business and maintains his family out of the. income of the

. business, the other· members of the family who suffer the bereavment

have necessarily to carry on the business for the maintaince and

support

of the family. A running business is indeed a very valuable

asset and often a great source

of comfort to the family as the ·

business keep; the family going. So long as the contractual tenancy

of a tenant who carries on the business continuest there can be no

question of the heirs of the deceased tenant not only inheriting the

tenancy but also inheriting the business and

th'ey are entitled to run

and enjoy the same.

We have earlier held that mere termination of

the contractual tenancy does not bring

· about any change in the

status

of the tenant and

the· tenant by virtue of the definition of

the 'tenant' in the Act and the other Rent Acts continues to enjoy

the same status and position unless there be any provisions in the

Rent Acts which in.dicate to the contrary. The mere fact that in the

Act no provision has been made with regard

to the heirs of tenants

in respect

of commercial tenancies on the death of the tenant after

termination

of the tenancy, as has been done in the case of heirs of

the tenants

of· residential premises, does not indicate that the

Legislature intended that the heirs of the tenants of commercial

premises

will cease to enjoy the protection afforded to the tenant

under the Act. Tbe Legislature could never have possibly intended

that with the death

of a tenant of the commercial premises, the

busi· .

ness carried on

by the tenant,

however, flourishing it may be and even

if the same constituted the source of livelihood of the members of

the family, must necessarily come to an end on the death· of the

tenant, only because the tenant died after the contractual tenancy

· had been terminated. It could never have been the intention of the

Legislature that the entire family ·Of a tenant· depending upon the

. "t

SUPREME COURT REPORTS . (1985] SUPPL. S.C.R.

business 'carried o~ by the tenant_ will be completely · stranded and

. the business carried

on for years in the

premises· which had been

Jet out to the tenant must stop functioning at the premises which the

heirs

of the deceased tenant must necessarily

vacate, as they are

afforded no protection under the Act.

We are of the opinion that

case of. commercial premises governed by· the Delhi Act, the·

·Legislature has not thought it fit in the light of the situation at Delhi

to place any kind of restriction 0,1 the ordinary law of inheritance

with regard

-to

succession. It may also be borne in mind that in

case

of commercial premises the heirs of the deceased tenant not

only succeed to the tenancy rights in the premises but they succeed

to the business as a whole. It might have been open to the Legisla

ture to limit

or restrict the right of inheritance with

regard to the

tenancy as the Legislature had done in the ca;e of the tenancies with

regard

to the residential houses but it would not have been open to

the Legislature to alter under the Rent Act, the Law of Succession

regarding the

bu;ines_s which is a valuable heritable right and which

must necessarily devolve

on all the heirs in accordance

with law.

The absence

of any provision restricting the heritability of the

tenancy in respect of the commercial premises only establishes

. that

commercial tenancies notwitb.standin~ the determin.ation of the

contractual tenancies will devolve on the heirs in accordance with

law and the heirs who step into the position of the deceased tenant

will continue

to enjoy the protection afforded by the Act and they

can only be evicted in accordance with the provisions

of_ the Act.

There is another significant consideration which,

in our opinion, .

lends support

to the view that we are taking. Commercial premises

are let

out not only to individuals but also to Companies, Corpora

tions and other statutory bodies having a juristic personality.

In fact,

tenancies in respect

of commercial premises are usually taken by

Companies and Corporations. When the tenant is a Company

or a

· , Corporation or anybody with juristic personality, question of the

death

of the tenant will not arise.

Dospite the termination of the.

tenancy, the Company or the Corporation or _such juristic" personali

ties, however, will go

on enjoying the protection afforded to the

tenant under the Act.

It can hardly be . conceived that the Legis-

lature would intend to deny. to one class of tenants, namely,

individuals the protection which will be enjoyed by the other class'

namely, the Corporations and Companies and other bodies with

juristic personality .under the Act.

If it

be,· held that commercial

tenancies after the termination

of the contractual tenancy of the

GIAN DEVI ANAND v. JEEVAN KUMAR (A;N. Sen, J.) 37

tenant are not heritable on the death of the tenant and the heirs

of the tenant are not entitled to enjoy the protection under the Act,

an irreparable mischief which the Legislature could never have

intended

is likely.to be caused. Any time after the creation of the

contractual tenancy, the landlord may determine the contractual

tenancy, allowing the tenant to continue to remain in possession

the premises, hoping for an early death of the tenant, so that on

the death

of a tenant he can immediately proceed to institute the

proceeding for recovery and recover. possession

of the premises as a

matter

of course, because the heirs would not have any right to

remain in occupation and would not enjoy the protection of the

Act. This could never have been intended by the Legislature while

framing

the Rent Acts for affording protection to the tenant against

eviction that the landlord would be entitled to recover possession,

even no grounds for eviction

as prescribed in the Rent Acts are

made out.

In our opinion, the view expressed by this Court in Ganpat D

Ladha's case and the observations made therein which we have

earlier quoted, do not lay down the correct law. The said decision

does not properly construe the definition

of the 'tenant' as given in

S. 5(1 l)(b) of the Act and does not consider the status of the tenant,

as defined in the Act, even after termination

of the commercial

tenancy. In our judgment in

Damadi/al's case this Court has

correctly appreciated the status and the legal position

of a tenant

who continues to remain in possession after termination

of the

contractual tenancy. We have quoted at length the

view of this

Court and the reasons in support thereof. The view expressed by

a seven-Judge Bench

of this Court in Dhanapal Chetttiar's case and

the observations made therein which

we have earlier

quoted, lend

support to the decision

of this Court in Dhamadila/'s case. These

decisions correctly lay down that the termination

of the contractual

tenancy

by the landlord does not bring about a change in the status

of the tenant who continues to remain in possession after the

termi

nation of the tenancy by virtue of the provisions of the Rent Act.

A proper interpretation

of the definition of tenant in the light of

the provisions made in the Rent Acts makes it clear that the tenant

continues to enjoy an estate

or interest in the tenanted premises

despite the

t~rmination of the contractual tenancy.

j ~ccordingly, we hold that if the Rent Act in question defines

a tenant in substance

to mean a tenant who continues to remain in

38 SUPREME COURT REPORTS (1984) SUPPL. s.c.R.

posse,.ion even after the termination of the contractual tenancy till

a decree for eviction against him is passed', the tenant even after

tho . determination of the tenancy continues to have an estate or

interest in the tenanted premises and the tenancy rights both in

. respect of residential premises and commercial premises are heritable •.

The heirs of the deceased tenant in the absence of any provision in

the Rent Act to the contrary 'wili step into the position

of the

decreased tenant and all the rights

and obligations of the deceased

tenant including the protection afforded to the deceased tenan't under

. the Act will devolve on the heirs of the deceased teanant. As the

protection afforded by the Rent-Act to a tenant after determination

of the tenancy and · to bis heirs on the death of such tenant is a

creation

of the Act for the benefit of the tenants, it is open to the

Legislature which

provides for such protection to make appropriate ·

provisions in the Act with regard to the nature .and extent of the

' benefit and protection to be enjoyed and the manner in which the

iame is to be enjoyed. If the Legislature makes any provision in the

Act limiting

or restricting the benefit and tbe nature of the protection

to be enjoyed in a specified manner_ by any particular class of

heirs of the deceased

tenant on any condition laid down being ful·

filled, the benefit· of the protection has necessarily to be enjoyed on

the fulfilment

of the condition in the manner and to the

extent stipu

lated in' th• Act. The Legislature which by the Rent Act seeks to

confer the benefit on the tenants

and to afford protection against

eviction, is perfectly competent

to make appropriate provision

regu~ .

la ting the nature. of protection and the manner and extent of

enjoyment of such tenancy rights after the termination of contractuai

tenancy

of the tenant including the rights and the nature of protecticin

of the heirs on the death of the tenant. Such appropriate provision

may be made by the Legislature

both with regard to the

residential·

tenancy and commercial tenancy. It is, however, entirely for the

Legislature

to decide

whether the Legislature will make such pro-

vi,ion or not.

In the absence of any provision regulating the right

of inheritance, and the manner and extent thereof and in the absence . of any condition being stipulated with regard to the devolution of

tenancy rights on the heirs on the death of the tenant, the devolution

of tenancy rights must necessarily be in accordance with the ordinary

law

of succession.

In the D~lbi Act, the Legislature bas thought it fit to niake

proyision_s regulating the right to inherit the tenancy rights in resrect

.. __ ,·

GIAN DEVI ANAND v. JEEYAN KUMAR (A.N. Sen, J.) 39

I -

of residential premises. The relevant provisions are contained in

S. 2(1}(ih) of the Act. With regard to the commercial premises, the

Legislature in the Act under consideration has thought it

fit not to

make any such provision.

It may he noticed that in some Rent

Acts provisions regulating heritability

of commercial premises, have

also been made whereas in some Rent Acts no such provision either

in respect

of residential tenancies or commercial tenancies has been

made. As

In the

present Act, there is no provision regulating the

rights

of the heirs to inherit the tenancy rights of the tenanted

premises which is commercial premises, the tenancy right which is

heritable devolves on the heirs under the ordidary law

of succession.

The tenancy right

of Wasti Ram, therefore, uevolves on all the

heirs

of Wasti Ram on his death; -

We must; therefore, hold that Wasti Ram enjoyed the statute

of the premises in dispute even after determination of the contractual

tenancy and notwithstainding the terimination' of the contractual

tenency, Wasti Ram had an estate or interest in the demised premises;

and tenancy rights

of Wasti Ram did not come to an end with his

death

but they_ devolved on the heirs and

leral representative_of Wasti

Ram.

The heirs ~nd legal representatives of Wasti Ram step 'into

his position and they are entitled to the benefit and protection

of the

Act.

We must; accordingly, hold that the High Court was not right

iu coming to the conclusion that the heirs

of Wasti Ram, the so called

statutory tenant, did not have any right to remain in possession

of the tenanted premises and did not enjoy any protection _under

the Act. It appears that the High

Court passed an order for

_eviction against the heirs

of Wasti Ram only on this ground without

going into the merits

of the appeal filed by the appellant in the High

Court_ agairist the order of remand and also without

considering the

cross-objections filed in the High Court by the landlord. e accord

ingly, set asled the judgment and order of the High Court' -and we

remand the case to the High Court for decision of the appeal and the

cross -objection on.merits. The appeal is accordingly allo~ed to the

extent indieated above with no order as to costs.

Before concluding, there is one !'aspect which we consider it

desirable to make certain observations. The owner of any premises,

whether residential

or commercial, let out to any tenant, is permitted

by the Rent Control Acts to seek eviction

of the tenant only on tne

ground

specified in the Act, entitling 'the landlord to evict the tenant

•

40 SUPREME COURT REPORTS [ 1985] SUPPL s.c.R.

from the premises. The restrictions on the power of the landlords

in the matter

of recovery of possession of the premises let out by him

to a tenant have been imposed for the benefit

of the tenants. Inspite

of various restrictions put on the landlords's right to recover

posses

sion of the premises from a tenant, the right of the landlord to re

cover possession of the premises from the tenant for the bona fide

need of the premises by the landlord is recognised by the Act, in case

of residential premises. A landlord may let out the premises under

various circumstances. Usually a landlord lets out the premises when

he does not need it for own use. Circumstances may change and a

situation may arise when the landlord may require the premises let

out by him for bis own use.

It is just and proper that when the

land

lord requires the premises bona fide for his own use and occupation,

the landlord should be entitled to recover the possession of the pre

mises which continues to be his property inspite of his letting out the

same to a tenant. The legislature

in its wisdom did recognise this

fact and the Legislarure has provided

that bona fide requirement of

the landlord for his own use

will be a legitimate ground under the

Act for the eviction

of his tenant from any residential premises. This

ground

is, however, confined to residential premises and is not made

available

in case of commercial premises. A landlord who lets out

commercial premises to a tenant under certain circumstances may

need bona

fide the premises for his own

use under changed conditions

in some future date should not in fairness be deprived of his right to

recover the commercial premises. Bona

fide need

of the landlord

will stand very much on the same footing in regard to either class of

permises, residential or commercial. We therefore, suggest that Legis

lature may consider the advisability of making the bona fide require

ment of the landlord a ground of eviction in respect •of commercial

premises

as well.

M.L.A. Appeal a/lowed.

)

Reference cases

Description

A Landmark Ruling on the Heritability of Commercial Tenancy in India

The Supreme Court's decision in Smt. Gian Devi Anand v. Jeevan Kumar and Others stands as a monumental judgment in Indian property law, definitively settling the legal principles surrounding the heritability of commercial tenancy. This case, available on CaseOn, is a cornerstone for understanding statutory tenant rights, clarifying that the heirs of a tenant in a commercial property are entitled to the same protections against eviction as the original tenant under the Delhi Rent Control Act, 1958. This analysis delves into the court's reasoning and its enduring impact on landlord-tenant jurisprudence.

Case Background: The Facts of the Matter

The dispute centered around a shop in New Delhi. The appellant's husband, Wasti Ram, was the original tenant. In 1970, the landlord terminated the contractual tenancy by serving a notice to quit and subsequently filed for eviction on several grounds. This legal action effectively converted Wasti Ram’s status from a contractual tenant to a “statutory tenant”—someone who continues to occupy the premises not by contract, but by the protection afforded under the Rent Control Act.

During the pendency of the appeal, Wasti Ram passed away, and his widow, Smt. Gian Devi Anand, was substituted as his legal heir. The landlord introduced a crucial new argument: that upon the death of a statutory tenant, the right to tenancy, being a personal right, does not pass to the heirs. The Delhi High Court accepted this contention, ruling that the protection of the Act was personal to Wasti Ram and his heirs had no right to remain in possession. This decision was then challenged before the Supreme Court.

Legal Analysis: The IRAC Framework

Issue: Are Commercial Tenancies Heritable?

The primary legal question before the five-judge bench of the Supreme Court was: Do the heirs of a deceased statutory tenant of a commercial property inherit the tenancy and its protections under the Delhi Rent Control Act, 1958, or does the right to occupy the premises extinguish with the tenant's death?

Rule: Interpreting the Delhi Rent Control Act, 1958

The Court's decision hinged on the interpretation of the definition of a 'tenant' under the Act and the legislative intent behind it. The key provisions considered were:

Section 2(l)(ii) of the Delhi Rent Control Act, 1958: This section defines a 'tenant' to include “any person continuing in possession after the termination of his tenancy.” The Court noted that this definition makes no distinction between a contractual tenant and a statutory tenant.
The 1976 Amendment (Section 2(l)(iii)): This amendment was introduced to specifically regulate the heritability of residential tenancies. It restricted the right of succession to specific heirs (like spouse, children, parents) who were ordinarily living with the deceased tenant. Crucially, no such restriction was introduced for commercial tenancies.
Precedents: The Court analyzed earlier judgments, particularly siding with the view in Damadilal v. Parashram, which held that a statutory tenant possesses a heritable interest, and overruling the contrary view expressed in Ganpat Ladha v. Sashikant Vishnu Shinde.

Analysis: The Supreme Court's Reasoning

The Supreme Court undertook a thorough analysis, dismantling the argument that a statutory tenancy is merely a personal right. The judges reasoned that the protection granted by the Rent Act creates a legal interest in the property that is not extinguished upon the tenant’s death.

The Court's logic was built on three pillars:

Statutory Interpretation: The Act places a statutory tenant on the same footing as a contractual tenant for the purpose of eviction protection. Since a contractual tenancy is an estate that is heritable under general law, the Court found no reason why a statutory tenancy should be treated differently, especially when the statute itself creates no such distinction.
Legislative Intent: The Court emphasized the significance of what the legislature chose not to do. By creating specific, restrictive rules for the heritability of residential tenancies in 1976 but remaining silent on commercial tenancies, Parliament signaled a clear intent to allow the general laws of succession to apply to the latter. If the intent was to make all statutory tenancies non-heritable, the amendment for residential properties would have been unnecessary.
Socio-Economic Justice: The Court highlighted the severe and unjust consequences of a contrary ruling. A commercial tenancy is often the foundation of a family's livelihood. To hold that this right vanishes upon the tenant's death would mean that a flourishing business, which supports a family, must shut down, causing immense hardship. This would defeat the very purpose of the Rent Act, which is a piece of social welfare legislation designed to protect tenants from exploitation.

Legal professionals often face complex precedents like those in the Gian Devi Anand case. To quickly grasp the nuances of this ruling and its impact on property law, CaseOn.in offers 2-minute audio briefs, breaking down key judgments for efficient case analysis.

Conclusion: Commercial Tenancy is Heritable

The Supreme Court concluded decisively that the rule of heritability extends to statutory tenancies of commercial premises under the Delhi Rent Control Act. The Court held that the heirs of a deceased tenant step into the original tenant's position and are entitled to the full protection of the Act. The judgment of the High Court was set aside, and the case was sent back for a decision on the other merits of the eviction petition.

Final Summary of the Judgment

In essence, the Gian Devi Anand judgment established that unless a Rent Control Act specifically states otherwise, the tenancy of a commercial property is heritable. The heirs of a statutory tenant inherit not just the business but also the legal right to occupy the premises, and they can only be evicted on the grounds specified in the Act. This ruling drew a clear line between residential tenancies, where heritability could be statutorily limited, and commercial tenancies, where the ordinary law of succession prevails.

Why is Gian Devi Anand a Must-Read for Lawyers and Law Students?

For Lawyers: This judgment is a foundational authority in landlord-tenant disputes involving commercial properties. It is indispensable when advising clients on the succession of tenanted business premises, defending against eviction, or challenging the rights of legal heirs.
For Law Students: This case is a masterclass in statutory interpretation, demonstrating how courts discern legislative intent from both the text and the silence of a statute. It showcases the evolution of Indian jurisprudence, where courts actively interpret laws to advance socio-economic justice and protect vulnerable parties.

Disclaimer: The information provided in this article is for informational purposes only and does not constitute legal advice. It is recommended to consult with a qualified legal professional for advice on any specific legal issue.

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