PETITIONER:
RAM SWAROOP RAI
Vs.
RESPONDENT:
LILAVATHI
DATE OF JUDGMENT07/05/1980
BENCH:
KRISHNAIYER, V.R.
BENCH:
KRISHNAIYER, V.R.
PATHAK, R.S.
CITATION:
1982 AIR 945 1980 SCR (3)1034
1980 SCC (3) 452
CITATOR INFO :
C 1984 SC 87 (20)
RF 1988 SC2031 (7)
F 1990 SC 897 (8,11,13)
ACT:
U.P. Rent Control Act (Act 13 of 1972), Section 2(2)-
Exemption from application of the provisions of the Act for
the period of ten years in respect of new constructions-
Burden of Proof is upon the landlord and not upon the
tenant.
HEADNOTE:
The respondent landlady purchased shop No. 66 in the
city of Jhansi in 1969 from one Brij Mohan (DW 2), occupied
the first floor and allowed the appellant/tenant to occupy
the ground floor in 1970 on a lease deed which recited that
the building was erected in 1965. In 1975, the respondent
filed the ejection suit on the basis that the building was
new, that the Act did not deter eviction of new
constructions put up within ten years of the suit and so a
decree was inevitable. The appellant-tenant resisted the
claim on the plea that the building was constructed 50 years
earlier. The Trial Court negatived the defence and decreed
eviction and this was upheld by the High Court. Hence the
appeal by special leave to this Court.
Allowing the appeal and remanding the matter to the
Trial Court, the Court
^
HELD : 1. In the normal course, no doubt the appeal
must be dismissed as concluded by findings of fact. To avoid
possible public mischief through a new class of litigation
for eviction by easy resort to the "new construction,"
expedient, interference under Article 136 of the
Constitution is necessary. [1037 A-B]
2.Section 2(2) of the U.P. Act, uses the phrase
"nothing in the rent control legislation shall apply to a
building" during a period of ten years from the date on
which its construction is completed. In other words, in
regard to all buildings the Act applies save where this
exemption operates. Therefore the landlord who seeks
exemption must prove that exception. The burden is on him to
make out that notwithstanding the rent control legislation,
his building is out of its ambit. It is not for the tenant
to prove that the building has been constructed beyond a
period of ten years, but it is for the landlady to make out
that the construction has been completed within ten years of
the suit. This is sensible not merely because the statute
expressly states so and the setting unnecessarily implies
so, but also because it is the landlady who knows best when
the building was completed, and not the tenant. As between
the two, the owner of the building must tell the court when
the building was constructed, and not the tenant thereof.
Speaking generally, it is fair that the onus of establishing
the date of construction of the building is squarely laid on
the landlord although in a small category of cases where the
landlord is a purchaser from another, he will have to depend
on his assignor to prove the fact. [1038 C-F]
3. An analysis of Explanation 1 to s. 2(2) of the U.P.
Act indicates:
(1) Where a building has not been assessed, it is
the date on which the completion was reported
to, or otherwise recorded by the local
authority having jurisdiction. [1038 G-H]
1035
(2) Where a building has been assessed, it is the
date on which the first assessment comes
into effect.
Provided that if the date on which the
completion was reported, to, or otherwise
recorded by, the local authority is earlier
than the date of the first assessment, the
date of completion will be such earlier date.
[1039 A-B]
(3) Where there is no report, record or
assessment, it is the date of actual
occupation for the first time (not being an
occupation for the purpose of supervising the
construction or guarding the building under
construction). [1039 B-C]
Unfortunately, it is not possible for the purchaser-
respondent or the tenant-appellant to give direct testimony
about the time of the construction or the nature of the
construction vis-a-vis Explanation (b) or (c). The best
testimony is the municipal records about the completion of
the building and the verification by the municipal
authorities as to whether a new construction has come into
being or an old construction has been remodelled and, if so,
when exactly the completion took effect. It is quite
conceivable that the municipal records bearing on the
completion of the construction may throw conclusive light,
whatever might have been the original proposal in the plan
submitted. It is perfectly possible that on a view of the
earlier construction, vis a vis the completed new building
the former may form but a small part. It may also be that
the implication of the expression "increased assessment" may
be explained with reference to earlier assessment records in
the municipality. Moreover, whenever a new building is
completed, a report has statutorily to be made and only on a
completion survey and certificate, occupation is ordinarily
permitted. These records must also be available in the
office of the local authority. The statute makes it clear
that reliance upon the municipal records rather than on the
lips of witnesses, is indicated to determine the date of
completion and the nature of the construction. This
statutory guideline has been wholly overlooked and the
burden lying on the landlord has not been appreciated. The
result is that the eviction order has to be demolished.
[1039 F-G, 1040 D-G]
In the instant case (i) the Municipal assessment record
produced in the Court merely states "increased assessment".
It may suggest the existence of an assessment which has been
increased or it may perhaps be argued that when the building
was reconstructed a new assessment was made which was more
than the previous assessment and, therefore, was described
as increased assessment; (ii) the oral evidence is
inconsequential being second hand testimony. Even the
recital in the rent deed that there was a new construction
in 1965-66 is by the appellant and the respondent, neither
of whom has any direct knowledge about the construction. Of
course, an admission by the appellant is evidence against
him but an admission is not always conclusive especially in
the light of the municipal records such as are available and
the burden such as has been laid by the statute; and (iii)
the failure of the trial Court specifically to record when
the building was completed and what was the extent of
rebuilding, whether it was a case of total demolition and
reconstruction or such extensive additions as to push the
existing building into a minor part, becomes fatal. These
basic issues have failed to receive any attention from the
courts below. A finding recorded on speculative basis is no
finding and that is the fate of the holding. [1039 G-H, 1040
A-D]
1036
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2109 of
1979.
Appeal by Special Leave from the Judgment and Order
dated 7-5-1979 of the Allahabad High Court in Civil Revision
No. 900 of 1978.
A.K. Sen, B.S. Banerjee and R.N. Govind for the
Appellant.
J.P. Goyal and S.K. Jain for Respondent.
The Judgment of the Court was delivered by
KRISHNA IYER, J.-A brief back-drop leads to the short
point in issue. Chronic scarcity of accommodation in almost
every part of the country has made ‘eviction’ litigation
explosively considerable, and the strict protection against
ejectment, save upon restricted grounds, has become the
policy of the State. Rent Control Legislation to give effect
to this policy exists everywhere, and we are concerned with
one such in the State of U.P. (U.P. Act 13 of 1972). The
legislature found that rent control law had a chilling
effect on new building construction, and so, to encourage
more building operations, amended the statute to release,
from the shackles of legislative restriction, ‘new
constructions’ for a period of ten years. So much so, a
landlord who had let out his new building could recover
possession without impediment if he instituted such
proceeding within ten years of completion. The respondent is
a landlady who claims to fill the bill in this setting and
seeks to evict the appellant-tenant untrammeled by the
provisions of the Act. She has succeeded in both the courts
below and the appellant challenges the order as illegal and
vitiated by a basic error of approach.
We should have made short work of it had there not been
the need for this Court to set the sights right in the
class, of litigation where exemption from the operation of
the Act is claimed on the ground that the construction is
new and the case is filed within the ten-year moratorium. If
the exemption is erroneously liberalised to frustrate the
principal measure by failure to stick to basic legal
principles, the jurisprudence of rent control may become too
jejune to be socially effective. That is why we examine a
few fundamentals here in the decisional process of this
class of cases.
The area of controversy, factual and legal, is small.
The respondent purchased shop No. 66 in the city of Jhansi
in 1969 from one Brij Mohan (DW2), occupied the first floor
and allowed the appellant, as tenant, to occupy the ground
floor in 1970 on a lease deed which recited that the
building was erected in 1965. In 1975 the present eviction
action was instituted on the basis that the building was
new, that the Act did not debar eviction of new
constructions put up within ten years of the suit and so a
decree was inevitable.
1037
The tenant resisted the claim on the plea that the building
was constructed 50 years ago. The trial court negatived the
defence and decreed eviction and this was upheld by the High
Court.
If it were a bare finding of fact we should not have
reopened it, but Shri A.K. Sen argues that fundamental flaws
in the understanding of the law have vitiated the decision
which, if left uncorrected, will spell a new class of
litigation for eviction by easy resort to the ‘new
construction expedient. Such possible public mischief
persuades us to have a closer look at the Act to the extent
relevant.
Shri J.P. Goel rightly reminds us that in the normal
course the appeal must be dismissed as concluded by findings
of fact. But we will probe the matter further to explore
whether there is any substance in Shri A.K. Sen’s argument
of fundamental failure bearing on the legality of the
conclusions. The anatomy of the Act is substantially the
same as that of other similar legislations. The most
important feature we have to notice is the exemption from
application of the provisions of the Act for the period of
ten years in respect of new constructions. Section 2(2) is
relevant in this context and runs as follows:
Except as provided in sub-section (5) of section
12 sub-section (1A) of section 21, sub-section (2) of
section 24, sections 24A, 24B, 24C or sub-section (3)
of section 29, nothing in this Act shall apply to a
building during a period of ten years from the date on
which its construction is completed.
xxx xxx xxx
Explanation I.-For the purposes of this sub-
section,
(a) The construction of a building shall be deemed
to have been completed on the date on which the
completion thereof is reported to or otherwise recorded
by the local authority having jurisdiction, and in the
case of a building subject to assessment, the date on
which the first assessment thereof comes into effect,
and where the said dates are different, the earliest of
the said dates, and in the absence of any such report,
record or assessment, the date on which it is actually
occupied (not including occupation merely for the
purposes of supervising the construction or guarding
the building under construction) for the first time:
Provided that there may be different dates of
completion of construction in respect of different
parts of a building which are either designed as
separate units or are occupied
1038
separately by the landlord and one or more tenants or
by different tenants.
(b) ‘construction’ includes any new constructions
in place of an existing building which has been wholly
or substantially demolished;
(c) Where such substantial addition is made to an
existing building, that the existing building becomes
only a minor part thereof, the whole of the building
including the existing building shall be deemed to be
constructed on the date of completion of the said
addition.
This sub-section and its construction is decisive of the
fate of the appeal. Nothing in the rent control legislation
shall apply to a building “during a period of ten years from
the date on which its construction is completed.” The first
thing that falls to be emphasised is that in regard to all
buildings the Act applies save where this exemption
operates. Therefore, the landlord who seeks exemption must
prove that exception. The burden is on him to make out that
notwithstanding the rent control legislation, his building
is out of its ambit. It is not for the tenant to prove that
the building has been constructed beyond a period of ten
years. But it is for the landlady to make out that the
construction has been completed within ten years of the
suit. This is sensible not merely because the statute
expressly states so and the setting necessarily implies so,
but also because it is the landlady who knows best when the
building was completed, and not the tenant. As between the
two, the owner of the building must tell the court when the
building was constructed, and not the tenant thereof.
Speaking generally, it is fair that the onus of establishing
the date of construction of the building is squarely laid on
the landlord, although in a small category of cases where
the landlord is a purchaser from another, he will have to
depend on his assignor to prove the fact.
Firstly, therefore, we must examine whether the
respondent has made out her case for exemption from the
operation of the Act based on the vital fact that the
building has been completed only within ten years of the
suit. The second thing we have to remember is Explanation 1
quoted above. When is a building deemed to have been
completed? An analysis of Explanation 1 to s.2(2) of the
U.P. Act indicates:
(1) Where a building has not been assessed, it is
the date on which the completion was reported
to, or other wise recorded by the local
authority having jurisdiction.
1039
(2) Where a building has been assessed, it is the
date on which the first assessment comes into
effect.
Provided that if the date on which the completion
was reported to, or otherwise recorded by, the local
authority is earlier than the date of the first
assessment, the date of completion will be such earlier
date.
(3) Where there is no report, record or
assessment, it is the date of actual
occupation for the first time (not being an
occupation for the purpose of supervising the
construction or guarding the building under
construction ).
It is common case that Shop Nos. 65 and 66 were owned
by a common owner, Shri Brij Mohan, DW2. He sold only Shop
No. 66 to the respondent. So, there is no doubt, that there
was an existing building, Shop No. 66, long prior to the
ten-year period mentioned in the statute. According to the
testimony of Shri Brij Mohan, DW2, the old construction
continued, but certain additions and remodelling were done.
He had submitted a plan to the local authority indicating
the original construction and the proposed additions, and
that is marked as Exhibit in the case. This shows the
existence of a prior building, the proposal being for
addition or partial reconstruction and not for total
demolition. If we go by the plan, it is not possible to
conclude automatically that there is a new construction. If
we go by Brij Mohan’s evidence, the owner of the building at
the relevant time, we cannot necessarily hold that the
existing building has been substantially demolished and
reconstructed. Indeed, his evidence is to the effect that
the construction such as was made was beyond the 10 year
period.
Unfortunately, it is not possible for the purchaser-
respondent or the tenant-appellant to give direct testimony
about the time of the construction or the nature of the
construction vis-a-vis Explanation (b) or (c). The best
testimony is the municipal records about the completion of
the building and the verification by the municipal
authorities as to whether a new construction has come into
being or an old construction has been remodelled and, if so,
when exactly the completion took effect. The municipal
assessment record produced in the court merely state
“increased assessment”. It may suggest the existence of an
assessment which has been increased or it may perhaps be
argued that when the building was reconstructed a new
assessment was made which was more than the previous
assessment and, therefore,
1040
was described as increased assessment. The oral evidence in
the case, apart from what we have set out, is
inconsequential, being second hand testimony. Even the
recital in the rent deed that there was a new construction
is 1965-66 is by the appellant and the respondent, neither
of whom has any direct knowledge about the construction. Of
course, an admission by the appellant is evidence against
him but an admission is not always conclusive especially in
the light of the municipal records such as are available and
the burden such as has been laid by the statute.
Viewed in this perspective, the failure of the trial
court specifically to record when the building was completed
and what was the extent of re-building, whether it was a
case of total demolition and reconstruction or such
extensive additions as to push the existing building into a
minor part, becomes fatal. These basic issues have failed to
receive any attention from the courts below. A finding
recorded on speculative basis is no finding and that is the
fate of the holding in the present case.
We do not want to dwell on the evidence in greater
detail because we propose to remit the case to the trial
court (Court of the First Additional District Judge,
Jhansi). It is quite conceivable that the municipal records
bearing on the completion of the construction may throw
conclusive light, whatever might have been the original
proposal in the plan submitted. It is perfectly possible
that on a view of the earlier construction, vis a vis the
completed new building, the former may form but a small
part. It may also be that the implication of the expression
“increased assessment” may be explained with reference to
earlier assessment records in the municipality. Moreover,
whenever a new building is completed, a report has
statutorily to be made and only on a completion survey and
certificate, occupation is ordinarily permitted. These
records must also be available in the office of the local
authority. The statute makes it clear that reliance upon the
municipal records, rather than on the lips of witnesses, is
indicated to determine the date of completion and the nature
of the construction. This statutory guideline has been
wholly overlooked and the burden lying on the landlord has
not been appreciated. The result is that the eviction order
has to be demolished.
It may still be open to the landlady-respondent to make
out his case by producing better municipal evidence in the
light of what we have indicated. We do not wish to deny the
landlady this opportunity because the trial court has not
approached the problem from the correct legal angle. We set
aside the judgment of the courts below and remit the case
for hearing to the trial court. The trial court
1041
will give an opportunity to both sides to adduce fresh
evidence, documentary and oral, to make out the ground of
exemption from the application of the Act. Of course, when
the entire evidence is before the court, the onus of proof
will play a lesser role.
Before parting with the case, we wish to notice a
submission made by Shri Goel that the landlady’s son was an
unemployed engineer who needed the premises for personal
requirement. Even if the Act applies, it is open to the
landlady to make out any of the grounds under the Act for
eviction. To avoid prolixity and delay of the proceedings,
we permit the trial court to allow the landlady, if she
applies in that behalf, to plead on an alternative basis,
for eviction on any of the specified grounds under the Act.
The appeal is allowed and the case remitted to the
Court of the Addl. District Judge, Jhansi for fresh disposal
in the light of the observations made above.
S.R. Appeal allowed.
1042