PETITIONER: SHRI LAKSHMI VENKATESHWARA ENTERPRISES Vs. RESPONDENT: SYEDA VAJHIUNNISA DATE OF JUDGMENT03/03/1994 BENCH: MOHAN, S. (J) BENCH: MOHAN, S. (J) MUKHERJEE M.K. (J) CITATION: 1994 SCC (2) 671 JT 1994 (2) 175 1994 SCALE (1)789 ACT: HEADNOTE: JUDGMENT:
The Judgment of the Court was delivered by
MOHAN, J.- The short facts leading to civil appeal are as
under. The respondents executed a lease agreement on
December 6, 1971 for a period of 32 years. The subject-
matter of demise was a vacant site for the purpose of
erection of cinema theatre by the tenant, appellant. He was
put in possession. Thereupon, he applied for a licence for
construction. The construction was not completed within a
period of two years. The appellant made an application for
renewal of licence. On objection by the respondents, the
renewal was not granted. As a result, the construction of
cinema theatre was not completed. The appellant defaulted
in payment of arrears of rent. Therefore, the respondents
filed an application under Section 21(1)(a) of the Karnataka
Rent Control Act, 1961 (hereinafter referred to as ‘the
Act’) and for bona fide requirement under Section 21(1)(h)
of the Act. Pending the eviction proceedings, respondents
filed an application under Section 29(1) and (4) of the Act
because the appellant had not paid the rent in spite of
notice.
+ From the Judgment and Order dated January 1, 1991 of
the Karnataka High Court in C.R.P. No. 10618 of 1990
673
2. On August 18, 1990, the trial court passed an order on
I.A. VI directing the appellant to pay the an-ears of Rs
3,69,000. For compliance of this, thirty days’ time was
granted. Inasmuch as the said amount was not paid on
October 25, 1990, an order of eviction was passed. Against
this order, Civil Revision Petition No. 725 of 1991 was
preferred to the High Court of Karnataka. The said revision
came to be dismissed on January 29, 1991. Hence, this civil
appeal.
3. The only point that is argued by Mr N. Santosh Hegde,
learned counsel for the appellant is that during the
subsistence of the contractual tenancy for the period of 32
years under the registered deed, it is not open to the
respondents/landlords to seek eviction under the Karnataka
Rent Control Act, 1961. No doubt, Section 21 of the Act
says ‘notwithstanding’. But this does not mean that
provision can be availed of by the respondents since this is
the beneficial legislation in favour of the tenant. In
support of this submission, reliance is placed on the Full
Bench judgment of Karnataka High Court reported as Sri
Ramakrishna Theatres Ltd. v. General Investments &
Commercial Corpn. Ltd.1
4. This stand is opposed by the learned counsel for the
respondents, Shri M. Qamaruddin. He would submit that
insofar as Section 21 of the Act clearly postulates even the
abrogation of the ‘contract’ and the statute, namely,
Karnataka Rent Control Act, 1961 takes over in such a
situation, the parties are governed only by the provisions
of the Act. The civil court cannot have jurisdiction in
view of the non-obstante clause contained under Section 21.
5. This Court in V. Dhanapal Chettiar v. Yesodai Ammal2
categorically laid down that contractual tenancy will lose
its significance in view of the Rent Control Act. In that
case, even the notice under Section 106 of the Transfer of
Property Act was held to be a surplusage. It is, therefore,
urged that if a landlord could found an action on any one of
the enumerated grounds under Section 21 of the Act, the
action would be maintainable notwithstanding the existence
of a contractual lease.
6. Having regard to the above arguments, the only question
that arises for our consideration is, whether during the
subsistence of a contractual tenancy, it is open to the
landlord to resort to proceedings under Rent Control Act?
7. We must first refer to Section 21 of the Act.
“21. (1) 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 other authority in favour of the
landlord against the tenant:
1 ILR 1992 Kant 1296
2 (1979) 4 SCC 214
674
Provided that the court may on an application
made to it, make an order for the recovery of
possession of a premises on one or more of the
following grounds only, namely:
[Clauses (a) to (p) are omitted as not
necessary.
Clauses (a) to (p) enumerate the grounds
enabling the landlord to recover possession of
the premises from the tenant.]”
(emphasis supplied)
8. A careful reading of the said section shows that if
anything contrary is contained in any contract that cannot
prevail. The effect of non-obstante clause can be gathered
from the Dominion of India v. Shrinbai A. Irani3. In this
case, Bhagwati, J. speaking for the Court held as under
“While recognising the force of this argument
it is however necessary to observe that
although ordinarily there should be a close
approximation between the non-obstante clause
and the operative part of the section, the
non-obstante clause need not necessarily and
always be co-extensive with the operative
part, so as to have the effect of cutting down
the clear terms of an enactment. If the words
of the enactment are clear and are capable of
only one interpretation on a plain and
grammatical construction of the words thereof
a non-obstante clause cannot cut down the
construction and restrict the scope of its
operation. In such cases the non-obstante
clause has to be read as clarifying the whole
position and must be understood to have been
incorporated in the enactment by the
Legislature by way of abundant caution and not
by way of limiting the ambit and scope of the
operative part of the enactment.”
9. In Municipal Corpn., Indore v. Ratnaprabha4 scope of
Section 138(b) of the Madhya Pradesh Municipal Corporation
Act was dealt with. That section reads as under:
“The annual value of any building shall
notwithstanding anything contained in any
other law for the time being in force be
deemed to be the gross annual rent at which
such building, together with its appurtenances
and any furniture that may be let for use or
enjoyment therewith might reasonably at the
time of assessment be expected to be let from
year to year, less an allowance of ten per
cent for the cost of repairs and for all other
expenses necessary to maintain the building in
a state to command such gross annual rent.”
(emphasis supplied)
10. In Chettiar case2 it was held at page
222 as under : (para 11)
“It is true that the Rent Act is intended to
restrict the rights which the landlord
possessed either for charging excessive rents
or for evicting tenants. But if within the
ambit of those restricted rights he makes out
his case it is a mere empty formality to ask
him to determine the contractual tenancy
before institution of a suit for eviction. As
we have
3 AIR 1954 SC 596: (1955) 1 SCR 206
4 (1976) 4 SCC 622: AIR 1977 SC 308
675
pointed out above, this was necessary under
the Transfer of Property Act as mere
termination of the lease entitled the landlord
to recover possession. But under the Rent
Control Acts it becomes an unnecessary
technicality to insist that the landlord must
determine the contractual tenancy. It is of
no practical use after so many restrictions of
his right to evict the tenant have been put.
The restricted area under the various State
Rent Acts has done away to a large extent with
the requirement of the law of contract and the
Transfer of Property Act. If this be so why
unnecessarily, illogically and unjustifiably a
formality of terminating the contractual lease
should be insisted upon?”
Again at page 227, it is held : (para 16)
“Quoting from Manujendra case5 it was said at
page 911 : (SCC p. 109, para 8)
`We are inclined to hold that the landlord in
the present case cannot secure an order for
eviction without first establishing that he
has validly determined the lease under the
T.P. Act.’
Why this dual requirement? Even if the lease
is determined by a forfeiture under the
Transfer of Property Act the tenant continues
to be a tenant, that is to say, there is no
forfeiture in the eye of law. The tenant
becomes liable to be evicted and forfeiture
comes into play only if he has incurred the
liability to be evicted under the State Rent
Act, not otherwise. In many State statutes
different provisions have been made as to the
grounds on which a tenant can be evicted and
in relation to his incurring the liability to
be so evicted. Some provisions overlap those
of the Transfer of Property Act. Some are new
which are mostly in favour of the tenants but
some are in favour of the landlord also. That
being so the dictum of this Court in Rai Brij
Raj case+ comes into play and one has to look
to the provisions of law contained in the four
comers of any State Rent Act to find out
whether a tenant can be evicted or not. The
theory of double protection or additional
protection, it seems to us, has been stretched
too far and without a proper and due
consideration of all its ramifications.”
11. Therefore, this authority clearly holds that the
provisions of Rent Control Act would apply
notwithstanding the contract. However, what is sought to be
relied on by the learned counsel for the appellant is the
Full Bench judgment of Karnataka High Court in Sri
Ramakrishna case’. In that ruling the decision of this
Court in Dhanapal Chettiar case2 is sought to be
distinguished as one relating to the necessity for issuance
of notice under Section 106 of the Transfer of Property Act.
On that basis, the other ruling of this Court namely Firm
Sardarilal Vishwanath v. Pritam Singh6 is also
5 Manujendra Dutt v. Purnendu Prosad Roy
Chowdhury,(1967)ISCR475:AIR 1967SC1419
+ Rai Brij Raj Krishna v.S.K.Shawand Brothers,1951SCR
145:AIR 1951SC 115
6 (1978) 4 SCC 1: AIR 1978 SC 1518
676
distinguished. However, the Full Bench chose to rely on
Modem Hotel v. K. Radhakrishnaiah7 wherein the term ‘lease’
was excluded from the ambit of the said Act.
12. We are of the view that the statement of Full Bench
will have no application to this case. The appellant filed
OS No. 1690 of 1990 on the file of City Civil Court,
Bangalore in which he challenged the decree for eviction and
for declaration. He also prayed for injunction. The suit
was contested by the respondents. In that case, the plea of
jurisdiction was also raised. The trial court dismissed the
suit observing that it had no jurisdiction. For reasons
best known, the appellant did not prefer any appeal or
revision against the dismissal. Therefore, that judgment
has become conclusive and binding between the parties.
Hence, the effect of Section 21 of the Act on the contract
entered into between the parties need not be gone into.
13. In Sardari Lal case6 it was held at page 1523 as under
: (SCC p. 9,para 15)
” Analysing the position it clearly emerges
that the ratio in K.K.B. Capadia case8 is that
where the lease determines by efflux of time
and the tenant continues in possession under
the protection of the Rent Restriction Act he
acquires a status of irremovability unless
there is something to show that he is a tenant
holding over, mere payment of rent ‘without
necessary animus not being sufficient. Such a
tenant for the sake of convenience is
described as a statutory tenant. It would not
be open to such a tenant to urge by way of
defence, in a suit for ejectment brought
against him under the provisions of the Rent
Restriction Act, that by acceptance of rent a
fresh tenancy was created which had to be
determined by a fresh notice to quit. This
ratio is neither departed from nor
controverted in any subsequent judgment of
this Court.”
14. Further, it is not correct to hold that the Rent
Control Act is a beneficial enactment only to the tenant.
15. This is a case where the tenant in spite of the
specific direction to deposit Rs 3.69 lakhs did not do so.
The High Court had clearly pointed out that even at the
revisional stage, he had not deposited the amount.
16. Accordingly, we conclude that there are no merits in
this appeal which stands dismissed with costs.
7 (1989)2SCC686:AIR1989SC1510
8 Kai Khushroo Bezonjee Capadia v. Bai Jerbai Hirjibhoy
Warden, AIR 1949 FC 124: 1949 FCR 262: 51 BLR 874
678