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Tenant cannot dictate And question the adequacy/requirement of space for the proposed business venture of the Landlord

It is common knowledge that whenever a landlord moves in the Court for ejection of a tenant, on the ground of ' Personal Need', the tenant invariably takes a plea that the landlord already has sufficient space and therefore the plea of the landlord is unsustainable. Recently, the Apex Court in Civil Appeal Nos. 231-232 OF 2021 Balwant Singh @ Bsnt Singh & Anr. vs. Sudarshan Kumar & Anr. on 27 January, 2021 has finally set to rest the said controversy.

The brief facts of the case that the appellants/landlords initiated eviction proceedings against the tenants in respect of shops on the ground floor of the building in Khanna, Punjab. The appellants are NRI and sought immediate recovery of possession of the rented premises by invoking the provisions of Section 13B read with Section 18A of the East Punjab Urban Rent Restriction Act, 1949 Act claiming that they desired to start the business of sale, purchase and manufacture of furniture and the property already in possession of the landlord, is insufficient for the proposed business.

The two tenants pleaded before the Rent Controller that the landlords have already secured possession of the two shops through litigations and the furniture business can be conveniently conducted in the already available space.

The Rent Controller considered the rival submissions and observed that the three necessary ingredients for initiating proceedings under Section 13B of the Act were satisfied by the landlords. The Rent Controller accordingly rejected the objections of the tenants that a portion of the premises would be sufficient for the proposed business & ordered for eviction of the tenants.

Aggrieved by the said order, the tenants filed Revisions before the High Court to challenge the orders of the Rent Controller. The High Court was impressed by the arguments of the tenants and the order passed by the Rent Controller was then set aside. The said order of the High Court was assailed in the Apex Court.

Before the Apex Court, it was argued that the landlord has sufficient space available in their possession for the proposed furniture business and there was no bona fide need of the tenanted portion by the landlords. It was also pleaded that the landlords are aged people and therefore there was no bonafide need of the landlords for the proposed business venture.

The Apex Court was not satisfied with the logic & reasoning of the Respondents/ Tenants that the
landlords have adequate space and held that the tenants cannot dictate the adequacy of space required by the landlords for their proposed business and held thus:

On the above aspect, it is not for the tenant to dictate how much space is adequate for the proposed business venture or to suggest that the available space with the landlord will be adequate. Insofar as the earlier eviction proceeding, the concerned vacant shops under possession of the landlords were duly disclosed, but the case of the landlord is that the premises/space under their possession is insufficient for the proposed furniture business.

On the age aspect, it is seen that the respondents are also senior citizens but that has not affected their desire to continue their business in the tenanted premises. Therefore, age cannot be factored against the landlords in their proposed business.

On consideration of the above aspects, the genuine need of the appellants to secure vacant possession of the premises for the proposed business is found to be established. According to us, the adequacy or otherwise of the space available with the landlord for the business in mind is not for the tenant to dictate. The special procedure for NRI landlord was deliberately designed by the Legislature to speedily secure possession of tenanted premises for bona fide need of the NRI landlords and such legislative intent to confer the right of summary eviction, as a onetime measure cannot be frustrated, without strong reason.

The Apex Court accordingly set aside the impugned judgment and order of the High Court and ordered the respondents to handover vacant physical possession of the premises by 31 December, 2021.

It would be trite to refer to the case of the Apex Court in M/S.Sait Nagjee Purushotham & ... vs Vimalabai Prabhulal & Ors ( 2005) 8 SCC 252 which held as under:

It is true that the landlords have their business spreading over Chennai and Hyderabad and if they wanted to expand their business at Calicut it cannot be said to be unnatural thereby denying the eviction of the tenant from the premises in question. It is always the prerogative of the landlord that if he requires the premises in question for his bona fide use for expansion of business this is no ground to say that the landlords are already having their business at Chennai and Hyderabad therefore, it is not genuine need. It is not the tenant who can dictate the terms to the landlords and advise him what he should do and what he should not. It is always the privilege of the landlord to choose the nature of the business and the place of business.

It would be apposite to refer to the case of the Apex Court in Dinesh Kumar v. Yusuf Ali AIR 2010 SC 2679 wherein the Court has held that the landlord is the best judge of his need and has observed thus:
In Prativa Devi Vs. T.V. Krishnan (1996) 5 SCC 353, this Court held that the landlord is the best judge of his requirement and courts have no concern to dictate the landlord as to how and in what manner he should live.

It would be worthwhile to refer to the case of Ram Narain v. Lakshmi Dass Kundra AIR 1971 Delhi 268 wherein the landlord lived on the first floor and wanted the additional accommodation from the tenant on the first floor while the ground floor was being used for commercial purposes. The landlord did not convert the accommodation on ground floor into residential purpose but required residential accommodation on the first floor adjoining his own accommodation for a residence.

The Delhi High Court held that a landlord cannot be precluded from claiming back possession of a portion of his property merely because he has lived uncomfortably in the past and has decided to now live more comfortably, leading to the institution of a petition for eviction by him on the ground of personal requirement.

The most important limb of the ‘personal need’ of a landlord under the Rent Control Act is ‘Bonafide’ & ‘Need’.It is relevant to refer to the case of Shiv Sarup Gupta vs Dr. Mahesh Chand Gupta AIR 1999 SC 2507 wherein the Apex Court elucidated the true meaning of ' Bonafide' & 'Need' and held thus:

12. A perusal of Section 14 of the Act shows that the law has imposed restrictions on the recovery of possession, of any premises by landlord from a tenant notwithstanding any law or contract to the contrary. However, an order for recovery of possession is permissible on one or more of the specified ground. One such ground is the premises let for residential purposes being required bona fide by the landlord for occupation as residence for himself or for any member of his family dependent on him.

What is a bona fide requirement is not defined in the Act. The words 'need' and 'require' both denote a certain degree of want with a thrust within demanding fulfilment. 'Need' or 'requirement' qualified by word 'bonafide' or 'genuine' preceding as an adjective - is an expression often used in Rent Control Laws

 'Bonafide or genuine need' of the landlord or that the landlord 'genuinely requires' or requires bona fide an accommodation for occupation by or use for himself is an accepted ground for eviction and such expression is often employed by Rent Control legislation draftsman. The two expressions are interchangeable in practise and carry the same meaning.

13. Chambers 20th Century Dictionary defines bonafide to mean 'in good faith: genuine'. The word 'genuine' means 'natural; not spurious; real: pure: sincere'. In Law Dictionary, Mozley and Whitley define bonafide to mean 'good faith, without fraud or deceit'. Thus the term bonafide or genuinely refers to a state of mind. Requirement is not a mere desire. The degree of intensity contemplated by 'requires' is much more higher than in mere desire.

The phrase 'required bonafide' is suggestive of legislative intent that a mere desire which is outcome of whim or fancy is not taken note of by the Rent Control Legislation. A requirement in the sense of felt need which is an outcome of a sincere, honest desire, in contra-distinction with a mere pretence or pretext to evict a tenant, on the part of the landlord claiming to occupy the premises for himself or for any member of the family would entitle him to seek ejectment of the tenant.

Looked at from this angle, any setting of the facts and circumstances protruding the need of landlord and its bonafides would be capable of successfully withstanding the test of objective determination by the Court. The Judge of facts should place himself in the arm chair of the landlord and then ask the question to himself-whether in the given facts substantiated by the landlord the need to occupy the premises can be said to be natural, real, sincere, honest.

If the answer be in the positive, the need is bonafide. The failure on the part of the landlord to substantiate the pleaded need, or, in a given case, positive material brought on record by the tenant enabling the court drawing an inference that the reality was to the contrary and the landlord was merely attempting at finding out a pretence or pretext for getting rid of the tenant, would be enough to persuade the Court certainly to deny its judicial assistance to the landlord.

Once the court is satisfied of the bonafides of the need of the landlord for premises or additional premises by applying objective standards then in the matter of choosing out of more than one accommodation available to the landlord his subjective choice shall be respected by the court.

The court would permit the landlord to satisfy the proven need by choosing the accommodation which the landlord feels would be most suited for the purpose; the court would not in such a case thrust its own wisdom upon the choice of the landlord by holding that not one but the other accommodation must be accepted by the landlord to satisfy his such need. In short, the concept of bonafide need or genuine requirement needs a practical approach instructed by realities of life. An approach either too liberal or two conservative or pedantic must be guarded against.

Thus it is no longer Res Integra that if a landlord is in Genuine & Bonafide need of a tenanted portion, the tenant cannot legally raise the issue that the space available with the landlord is adequate. The Courts have ruled that the tenants cannot dictate upon the landlord's personal need of the tenanted premises.

Written By: Inder Chand Jain
Ph no: 8279945021, Email: [email protected]

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