JUDGMENT
Arun Kumar, J.
(1) By this petition under Article 227 of the Constitution of India, the petitioners have challenged the order dated 17th December 1993 passed by the Addl.Rent Controller who has been imp leaded as respondent No.1 By the impugned order the respondent No.l allowed oral evidence to be led in support of the objections filed by the objector respondent No.2 against the order dated 31st October 1980 of the then Addl.Rent Controller granting permission for fixed term lease by the petitioners of the suit property in favour of respondent No.2 for a period of five and half years under Section 21 of the Delhi Rent Control Act (herein after referred to as the Act). By virtue of the objections filed by respondent No.2 about 12 days before the expiry of the period of lease the respondent No.2 has been able to drag on the matter for almost ten years and has continued to enjoy the suit premises and retain its possession so far. The necessary facts for the present purposes are:-
(2) The petitioners Shri B.K. Kapur and his mother Smt. Bindra Devi Kapur are the owners of the suit premises, i.e. 46,Friends Colony, New Delhi. The petitioners and the respondent No.2 entered into an arrangement under which the suit premises was to be let out to the respondent No.2 for a fixed period of five years and six months starting from 1st November 1980 under Section 21 of the Act. A joint application under Section 21 of the Act for permission to lease out the premises for a fixed period was filed before the Controller. A draft of the proposed lease deed which was to be entered into between the parties was annexed to the application. The Addl.Rent Controller who was seized of the matter recorded statements of Shri Rajiv Chaudhary on behalf of the petitioners and Shri Jagdish Kumar on behalf of the respondent on 31st October 1980. On the same date the Addl.Rent Controller passed the order allowing the application for grant of permission to the petitioners to let out the premises as shown in plan Ex.A-3 which was also annexed to the joint application to the respondents for residential purposes for a period of five and half years w.e.f. 1st November 1980. After the permission was granted on 11th November 1980 the parties executed a formal lease deed as per the draft lease deed Filed before the Controller and possession of the premises was handed over to the respondent No.2. It is recorded in the lease deed dated 11th November 1980 that the said lease deed was being executed in pursuance of the order of the Additional Rent Controller dated 31st October 1980 granting permission to lease out the suit premises for a fixed period of five years and six months starting with 1st November 1980. The period under the lease was to expire on 30th April 1986. On 10th March 1986 the petitioner No.1 wrote a letter to the respondent company reminding it that the premises was required by the petitioners for personal use and occupation and, therefore, it was to be ensured that the possession of the premises is given back to the petitioners on or before 30th April 1986. The petitioner further called upon the respondent to inform the petitioner the date when the possession of the house could be handed back to the petitioners, The petitioner also sought an opportunity to visit the house for a general inspection within the next two weeks of the said letter. The receipt of this letter is not disputed by the respondent. On 19th April 1986 the respondent filed objections before the Addl.Rent Controller challenging the validity of the order dated 31st October 1980 whereby permission under Section 21 of the Act was granted. The period under lease was due to expire on 30th April 1986.
(3) By the impugned order dated 17th December 1993, the Addl.Rent Controller, respondent No.l permitted oral evidence to be led on the objections filed by the respondent. The present petition challenging the said order was filed by the petitioners landlords on 24th January 1994.
(4) The grievance of the petitioners in the present petition is that the impugned order is contrary to the provisions of Section 21 of the Act and the assurance contained in the said provision to the landlords that they will be put in vacant possession of the tenanted premises on the expiry of the fixed term tenancy as held by the Supreme Court in its various decisions on the subject. According to the petitioners the impugned order permits a collateral challenge to the order of the Addl.Rent Controller dated 31st October 1980 whereby the permission for fixed term tenancy was granted.
(5) According to the learned counsel for the petitioner Section 21 of the Act is a self- contained Code as repeatedly held by She Supreme Court. The order granting permission under the said provision can be challenged only on the ground of fraud and collusion. However, such challenge is limited to jurisdictional facts alone, i.e. facts on the basis of which the Controller gets jurisdiction to pass the order under Section 21. The jurisdictional facts are only two:-
(A)that the premises in question or a part thereof was not required for a particular period;
(B)the premises which is let out is let out as a residence for such period as may be agreed to in writing between the parties.
(6) Thus if there was any fraud or collusion in conferring jurisdiction on the Controller which led him to pass the order under Section 21, the limited challenge to this extent is permitted. There is yet another condition laid down in this respect emerging from the decisions of the Supreme Court according to which such challenge based on jurisdictional facts is to be laid during the subsistence of the lease and no sooner the tenant comes to know of the facts and circumstances vitiating the order of grant of permission.
(7) It is submitted by the learned counsel for the petitioners that the jurisdictional facts in the present case are admitted, therefore, the allegations of fraud and collusion were totally untenable and baseless. In any case no inquiry or oral evidence could be ordered on the basis of objections of the respondent tenant. The sum and substance of the case of the petitioners in this behalf is:-
1.The objections filed by the respondent tenant could not be entertained at all in view of the settled law. This includes the plea that the objections were without any merit or substance and that they were filed belatedly for which reason also the same could not be entertained.
2.The oral evidence permitted to be led by the Addl.Rent Controller vide its impugned order is barred under the provisions of Sections 91 and 92 of the Evidence Act because such evidence is about alleged oral arrangement/agreement contrary to admitted documentary evidence on record coupled with admitted record of judicial proceedings.
3.Assuming that the objections could be entertained no oral evidence was required to be led in view of the nature of the objections.
(8) On the basis of the aforesaid submissions the learned counsel for the petitioners has urged that the impugned order of the Addl.Rent Controller is totally perverse and is without jurisdiction. It is further submitted that the impugned order results in grave and irreparable injury to the petitioners – the period of the fixed term lease expired on 30th April 1986, the application of the petitioners for being put in possession of the suit premises is pending before the Additional Rent Controller since the year 1986. The impugned order was passed on 17th December 1993. The evidence which is to be led in pursuance of the impugned order will take its own course and will be a highly time consuming process. It is a well known fact that in cases where the Controllers are recording evidence, proceedings go on for years. The petitioners have been denied the possession of the premises contrary to the statutory assurance given to them for almost ten years already and if the matter goes on for evidence, as directed by the Controller vide his impugned order, the petitioners may be deprived of the possession of the premises for years to come. It will lead to grave miscarriage of justice.
(9) The learned counsel for the respondent tenant filed a reply to the petition and has argued the matter at length controverting the contentions raised on behalf of the petitioners. He has also raised various preliminary objections regarding the maintainability of the present petition as also the jurisdiction of this Court in hearing the matter. The objections regarding maintainability of the petition are:- –
A)the petition is not maintainable on account of availability of alternative remedy of appeal against the impugned order.
B)the provisions of Article 227 of the Constitution of India cannot be invoked in the facts of the present case.
(10) The other preliminary objections were taken through an application (C.M. 846/95) moved at the time of hearing of this petition to take further pleas that the proceedings for the execution of the order dated 31st October 1980 granting permission for fixed term tenancy could not be continued on the basis of facts stated in the said application. These are:-
Are reference was made under Section 15 of the Sick Industrial Companies (Special provisions) Act 1985, (hereinafter referred to as the SICA) on 15th July 1989 to the Board for Industrial Finance Reconstruction (for short BIFR) for declaration of the respondent company as a sick industrial company. Under Section 16 of the said Act an inquiry was made by the BIFR. The BIFR vide its order dated 15th June 1990 determined that the respondent company was a sick industrial company and appointed the Industrial Development Bank of India as the operating agency to find out the ways and means of rehabilitating the respondent company. After the report of the operating agency the BIFR came to a conclusion vide order dated 28th/29th September 1993 that prima facie the respondent company should be wound up. On 2nd December 1993 an order was passed under Section 20 of the said Act by the BIFR for winding up of the respondent company by the High Court of Allahabad. The Allahabad High Court on 19th January 1994 directed the winding up of the respondent company and appointed the Official Liquidator for that purpose. The operation of the order of the BIFR was stayed by the Appellate Authority for Industrial & Financial Reconstruction, New Delhi on an appeal on 3rd February 1994. The Managing Director of the respondent company and the respondent company applied before the Company Court for recalling the winding up order dated 19th January 1994 and the (Company Court passed an order on 2nd March 1994 putting its earlier order dated 19th January 1994 for winding up of the company in abeyance. The Official Liquidator was directed not to proceed in the matter and it was also ordered that the order dated 19th January 1994 shall not be advertised in the official gazette till further orders. Nothing further in this connection has been brought to the notice of the Court in this behalf.
ON the basis of the aforesaid facts the following additional preliminary objections were taken:-
(C)in view of the provisions of Section 22 of Sica these proceedings cannot continue;
(D)these proceedings cannot be continued without leave of the Allahabad High Court as per provisions of Section 446 of the Companies Act 1956. First I will deal with the preliminary objections.
(11) The preliminary objections at (a) and (b) above relate to the maintainability of the present petition under Article 227 of the Constitution of India. So far as the question of availability of alternative remedy is concerned, it is to be noted that before its amendment in the year 1988, the Delhi Rent Control Act contained Section 38 which provided for appeals from orders of the Controllers including Additional Rent Controllers to the Rent Control Tribunal. By the amendment a proviso was added to Sub-Section (1) of Section 38 of the Act in the following terms:- “PROVIDED that no appeal shall lie from an order of the Controller made under Section 21,”
(12) Therefore, right of appeal from orders passed in proceedings under Section 21 was specifically barred by the said proviso.
(13) Relying on the proviso the learned counsel for the petitioners submitted that the remedy of appeal had become barred by the statute when the impugned order was passed on 17th December 1993 and, therefore, the petitioners had no other remedy except to approach this court by way of the present petition.. In reply to this the learned counsel for the respondent tenant submitted that the right of appeal is a substantive vested right which accrues to a party on the basis of statutory provisions in existence and in force at the time of commencement of the lis. This right cannot be taken away by subsequent amendment of the law. Thus, according to the learned counsel for the respondent, this right accrued to the parties before the amendment of the Act and continued to be available to the parties irrespective of the amendment. There is force in this argument on behalf of the respondent. At the same time it cannot be lost sight of that the amendment contains a specific bar qua the right of appeal which had existed prior to the amendment. It is not a case of implied repeal. There is something to be said on both sides.
(14) I need not go further on this because availability of an alternative remedy is not an absolute bar to the maintainability of a petition under Article 227 of the Constitution. The nature of the power conferred on the High Court under Art. 227 of the Constitution of India clearly suggests that the availability of alternative remedy cannot be an absolute bar on the exercise of this power though normally in view of availability of alternative remedy such a petition may not be entertained. It is a self imposed restriction.
(15) The legal position regarding the power of the High Court sunder Art. 227 of the Constitution of India was considered in Waryam Singh Vs. Amar Nath, . It was noted that precursor of Art. 227 of the Constitution of India was Section 107 of the Government of India Act 1915. The High Courts in India have enjoyed the power of administrative as well as judicial superintendence under these provisions. The power of superintendence is to be exercised “most sparingly and only in appropriate cases in order to keep the Subordinate Courts within the bounds of their authority and not for correcting mere errors”. In the said case the Supreme Court noted that the lower courts realised the legal position but in effect declined to do what was by Section 13(2)(i) of the East Punjab Urban Rent Restrictions Act 1949 incumbent on them to do and thereby refused to exercise jurisdiction vested in them by law. It was, therefore, held to be a case which called for interference under Art. 227 of the Constitution.
(16) In Nagendra Nath Bora vs. Commissioner of Hills Division Etc., , while dealing with the power of the High Courts regarding the Common Law writ of certiorari, the Supreme Court observed that the purpose is to determine on an examination of the record whether the inferior Tribunal has exceeded its jurisdiction or has not proceeded in accordance with the essential requirements of the law which it was meant to administer.
(17) In Pratap Singh Kairon vs. Gurmej Singh, , a Division Bench of the Punjab High Court had occasion to pronounce on the nature of the power under Art. 227 of the Constitution. It was observed:-
THE power of superintending control conferred by Article 227 is similar to the control exercised by the court of King’s Bench over the inferior courts of England under the common law. According to Blackstone the Court of King’s Bench was entitled to a general superintendence over all subordinate courts for the purpose of keeping them within the bounds of their authority and of preventing usurpation.
THE power which was exercised by the court of King’s Bench was a branch of the power of the King of England, while the power which has been conferred on the High Courts in this country by Article 227 is a branch of the sovereign power of the people as vested in them by the Constitution of a democratic Republic.”
(18) Following Waryam Singh’s case (supra), the Supreme Court in the Ahmadabad Manufacturing Vs. Ram Tahel etc., , observed that the power under Art. 227 of the Constitution is intended to be used sparingly and only in appropriate cases, for the purposes of keeping the Subordinate Courts and Tribunals within the bounds of their authority and not for correcting mere errors.
(19) When such is the scope of the power under Art. 227 of the Constitution of India mere availability of an alternative remedy can not oust the said power of the High Court. In each case the High Court will consider whether a case for exercise of the power under Art. 227 of the constitution of India is made out or not. The High Court will always be conscious of the fact that the power has to be used sparingly and with the main object of keeping the Courts and the Tribunals within bounds of their authority. If a case is made out where the Subordinate Court exceeds the bounds of its authority or passes an order which is without jurisdiction or refuses to exercise jurisdiction vested in it, the High Court may interfere with such an order, irrespective of the availability of the right of the appeal. In this context reference may be made to Shyam Kishore vs. M.C.D., of the said judgment the Supreme Court took note of the fact that ordinarily the High Court will not entertain a petition under Art. 226 of the Constitution when alternate remedy of appeal is available to the party but it must be said that the High Court has the jurisdiction to grant such a relief if it thinks proper to do so in the circumstances of any case. It is settled law that if there is case of a manifest error, error in exercise of jurisdiction on the facts on record or an order being per se void, the High Court may interfere with such an order without insisting on alternative remedy being availed of. The discussion to follow will show that the impugned order in the present case is manifestly illegal and is contrary to the clear and settled position of law. It amounts to refusal to exercise jurisdiction vested in the Additional Rent Controller, inasmuch as he failed to ensure that the landlords are put in possession of their premises forthwith on their approaching the Additional Rent Controller for that purpose. It also results in grave miscarriage of justice and grave and irreparable injury inasmuch as it embroils the petitioners in prolonged and indefinite litigation and in the process deprives them of the possession of the suit premises contrary to the statutory assurance and protection. For all these reasons I am of the view that the present petition under Art. 227 of the Constitution is maintainable.
(20) In support of his contention regarding non-maintainability of the petition under Art. 227 of the Constitution, the learned counsel for the respondent has referred to various decisions which I may only note here because none of these decisions comes in my way in taking the view which I have taken on this point. The judgments cited on behalf of the respondent are:-
1)D.N.Banerji vs. P.R.Mukherjee,
2)Satyanarayan vs. Mallikarjun, .
3)The State of Orissa & Am. vs. Murlidhar Jena, Air 1963 Sc 404
4)Nibaran Chandra Bag vs-.Mahendra Nath Ghughu (deceased),
5)Assistant Collector of Central Excise vs. Dunlop India Ltd,
6)Modh. Yunus vs. Mohd Mustaqin,
7)HALILAhmed Bashir Ahmed vs. Tuffelhussein,
8)M/s B.K. Khanna & Co. Pvt.Ltd. vs. K.C. Nahar & Ors., Ilr (1971) Ii Delhi 366
9)Miss Maneck C. Sarjar ji vs. Sarfazali,
10)K.K.Shrivastava vs. Bhupendra Kr. Jain,
11)Avon Scales Co. vs. State of Haryana, 1979 Tax.L.R. 1664 (P&H)
12)Nand Gopal Bacchas vs Bank of India, 1982 Delhi 280
(21) The remaining preliminary objection urged by the learned counsel for the respondent tenant regarding continuance of the present proceedings are based on Section 22 of the Sick Industrial Companies (Special Provisions) Act 1985 and Section 446 of the Companies Act.
(22) So far as the objection based on Section 22 of the Sica is concerned, the learned counsel for respondent tenant submitted that Sub-Section (1) of Section 22 puts a complete embargo on the power of any Court to continue with any proceedings against a sick industrial company. The crucial words in the provision relied upon are “no proceedings for the winding up of the industrial company or for execution, distress or the like against any of the properties of the industrial company or for the appointment of a Receiver in respect thereof and no suit for the recovery of money or for the enforcement of the security against the industrial company or of any guarantee in respect of any loans, or advance granted to the industrial company shall lie or be proceeded with further, except that the consent of the Board or, as the case may be, the Appellate Authority”. It is urged that the present petition relates to property of the industrial company, lease hold rights in a property are valuable rights/assets of a company and, therefore, the present proceedings involving the same cannot be continued in view of the aforesaid provision. To my mind this contention on behalf of the tenant is wholly untenable. Firstly, it is to be noted in view of the provisions of Section 21 of the Delhi Rent Control Act that the rights of the tenant qua the leased property stand already determined vide order dated 31st October 1980 whereby permission for the fixed term tenancy was granted by the Addl.Rent Controller. The said order itself has the effect of extinguishing the rights of the tenant qua the premises. On the expiry of the fixed term tenancy the tenant is required to hand over possession of the premises to the landlord and is left with no right with respect to the premises thereafter. Therefore, it cannot be said that the respondent has any right qua the tenancy premises nor can the premises be said to be the property of the industrial company. The present proceedings are clearly out of the purview of Section 22 of SICA. This view finds support from the judgment of the Supreme Court in Mis Shree Chamundi Mopeds Ltd. vs. Church of South India Trust Association etc, . Referring to the object of Section 22(1) the Supreme Court held that it seeks to advance the object of the Act by ensuring that a proceeding having an effect on the working or the finances of a sick industrial company shall not be instituted or continued during the period the matter is under consideration before the Board or the Appellate Authority or a sanctioned scheme is under implementation without the consent of the Board or the Appellate Authority. It was further observed that it could not be the intention of the Parliament in enacting the said provision to aggravate the financial difficulties of a sick industrial company while the said matters were pending before the Board or the Appellate Authority by enabling a sick industrial company to continue to incur further liabilities during this period. It was held that the lease hold interest of a company which is in occupation of the premises as a statutory tenant by virtue of protection conferred by the statute, cannot be regarded as the property of the company for purposes of Sub-Section (1) of Section 22 of the Act and for that reason also the provisions of Section 22(1) were not attracted to the eviction proceedings. Thus Section 22(1) does not cover the proceedings instituted by a landlord of a sick industrial company for the eviction of the company from the premises let out to it. The present case is on a stronger footing in view of the fact that it arises from an order under Section 21 of the Act which has the effect of extinguishing the right of the tenant in the leased premises on the very date on which the order regarding grant of permission under Section 21 is passed. Thus after the expiry of the fixed term of tenancy there is no lease hold right with the company. The company has no right or semblance of a right qua the property. The objection based on Section 22 of the Sica is rejected.
(23) I may note here that in another suit for eviction (S.No.l703 of 1989) against this very company with respect to another premises by the landlord of that premises the respondent company raised similar objection to continuance of that suit in view of Section 22 of the SICA. A single Judge of this Court rejected the objection relying on the judgment of the Supreme Court in Shree Chaumundi Mopeds, (supra). An appeal against the said order of the single Judge was dismissed by the Division Bench on 18th March 1994 (F.A.O. (OS) 226 of 1992.
(24) This brings me to the next objection based on Section 446 of the Companies Act. Section 446 is reproduced as under:-
446.Suits stayed on winding up order.
(1)When a winding up order has been made or the Official Liquidator has been appointed as provisional liquidator, no suit or other legal proceeding shall be commenced, or if pending at the dale of the winding up order, shall be proceeded with, against the company, except by leave of the Court and subject to such terms as the Court may impose.
(2)The Court which is winding up the company shall, notwithstanding anything contained in any other law for the time being in force, have jurisdiction to entertain, or dispose of-
(A)any suit or proceeding by or against the company;
(B)any claim made by or against the company (including claims by or against any of its branches in India);
(C)any application made under section 391 by or in respect of the company;
(D)any question of priorities or any other question whatsoever, whether of law or fact, which may relate to or arise in course of the winding up of the company;
WHETHER such suit or proceeding has been instituted, or is instituted, or such claim or question has arisen or arises or such application has been made or is made before or after the order for the winding up of the company, or before or after the commencement of the Companies (Amendment) Act, 1960.
(3)Any suit or proceeding by or against the company which is pending in any Court other than that in which the winding up of the company is proceeding may, notwithstanding anything contained in any other law for the time being in force, be transferred to and disposed of by that Court.
(4)Nothing in sub-section (1) or sub-section (3) shall apply to any proceeding pending in appeal before the Supreme Court or a High Court.”
(25) Relying on Sub-Section (1) of the said Section the learned counsel for the respondent submitted that in view of a winding up order having been passed by the . ., learned Company Judge of the Allahabad High Court with respect to the respondent company, the present proceedings cannot be continued. It is submitted that the words “no suit or other legal proceeding” are wide enough to include in their sweep all legal proceedings qua such a company. The present proceedings, therefore, cannot be continued without permission of the Company Court. About the fact that the winding up order has been put in abeyance, as noted herein before, it was submitted that it does not mean that the order becomes non-existent. The order remains so long as it is not set aside or quashed. Putting an order in abeyance only means that for the time being it is not to be operated upon. Sudarsan Chits (1) Ltd. vs. Sukumaran Pillai & Ors., is relied upon in this behalf. The learned counsel for the respondent also relied on M.K-Ranganathan vs . Govt. of Madras, and In re. Kailash Financiers (Calcutta) Pvt.Ltd. 1982 Taxation Law Reporter 2439 in support of his plea that the words “other legal proceedings” are of very wide amplitude which include execution proceedings and proceedings under special statutes.
(26) On the main issue the learned counsel for the respondent heavily relied on L.I.C. of India vs. Asia Udyog (P) Ltd, (1984) 55 Company Cases 187 which is a Full ‘ Bench decision of this Court. This case involved proceedings against a company in winding up under the Public Premises (Eviction of Unauthorised Occupants) Act. It was held that such proceedings were covered under Section 446 of the Companies Act .. ., and leave of the winding up Court is necessary before initiating the proceedings. It is submitted that the present proceedings are also similar in nature as they are intended to evict the tenant from the suit premises. The Full Bench noted the object of Section 446 of the Companies Act which is to save the company under winding up from unnecessary litigation and to protect its assets for equitable distribution of among its creditors and its shareholders. The winding up court is concerned about the fact that the assets of the company under winding up are not wasted or frittered away. It is important to note that the Full Bench recognised the fact that the nature of the proceedings will have to be seen in every case so as to find out whether the proceedings are covered by the embargo placed by Section 446. Regarding the Public Premises Act it was found that it is not a distinct code creating its own liabilities and rights and nor has it brought forth new set of rights and liabilities. The Act deals with rights and liabilities of the parties under the ordinary law but a new forum and remedy had been created in respect of public premises. This aspect was emphasised by the Full Bench and directed it to be borne in mind for purposes of consideration of Section 446 of the Companies Act. Therefore, the proceedings under the Public Premises Act were considered to be covered within Section 446(1) of the Companies Act. This important aspect makes the present case clearly distinguishable. We are, in the present case, concerned with Section 21 of the Delhi Rent Control Act which has been held by the Supreme Court time and again to be a self-contained Code. Further it has been repeatedly held by the Supreme Court that Section 21 creates special rights and obligations. We cannot lose site of the nature of proceedings involved in a case of permission for a fixed term lease under Section 21. As per the plain language of Section 21 of the Delhi Rent Control Act, if the tenant fails to put the landlord in possession of the premises on the expiry of the fixed period of tenancy the Controller has to place the landlord in vacant possession of the premises in question by evicting the tenant and every other person who may be in occupation of such premises. The rights, if any, of the tenant stand determined on the day the order of permission for fixed term lease is passed. There is no right left with the tenant whatsoever to continue in possession of the premises after the specified date. Therefore, the application of the landlord for being placed in possession of the premises on failure of the tenant to comply with the order cannot be said to be covered in the words ‘any proceedings’ in Section 446(1) of he Companies Act.
(27) Secondly, assuming that process of putting the landlord in possession of his premises on the expiry of fixed term tenancy under Section 21 is covered under “any proceedings” in Section 446 of the Companies Act, it is important to note that Section 21 contains a non obstante clause. It provides “notwithstanding anything contained in Section 14 (of the Act) or any other law”. This clause will cover Section 446 of the Companies Act which is an earlier enactment. It means notwithstanding the said provision the Controller has to ensure that the landlord is placed in possession of the premises. For this reason also Section 446 of the Companies Act will not come in the way of the Controller or this Court.
(28) There is yet another aspect which cannot be lost sight of. Section 446(4) also contains a provision to the effect that “nothing in Sub- Section (1) or Sub-Section (3) shall apply to any proceeding pending in appeal before the Supreme Court or a High Court”. No doubt that scope of an appeal is wider yet the power of the High Court under Art. 227 though supervisory can be said to be saved by the analogy of the said provision of Sub-Section (4) of Section 446. This is a Constitutional power vested in the High Court and is an attribute of the sovereign powers of the High Courts. The same cannot be limited or curtailed by Section 446 of the Companies Act.
(29) While considering this aspect it has to be kept in view that we are dealing here with Section 21 of the Delhi Rent Control Act which as held by the Supreme Court contains a statutory assurance to the landlord that he will be put in possession of his premises forthwith on the expiry of the fixed term lease granted under that provision. Can the statutory assurance be whittled down on the basis of such provisions as contained in Section 446 of the Companies Act or Section 22 of SICA The Delhi Rent Control Act itself is a special legislation containing special provisions which regulate the general law regarding leases under the Transfer of Property Act. The special law has to prevail in preference to the general law. The statutory assurance under Section 21 of the Act cannot be allowed to be denuded in this manner, thereby frustrating the said provision.
(30) While on Section 446 of the Companies Act the object behind the said provision should also be kept in mind. It is to ensure that the assets of the company under winding up are not wasted or frittered away and are available for equal distribution amongst the creditors of the company and thereafter its shareholders. In the present case the winding up order passed by the Company Judge of the Allahabad High Court was based on the fact that the BIFR had directed the winding up of the Company under Section 20 of the SICA. The order under Section 20 of the BIFR was challenged before the Appellate Authority under the Sica and its operation was stayed. On that basis it is interesting to note that the respondent company itself through its Managing Director applied to the Company Court for stay of the winding up order. The Company Court put its earlier order regarding winding up of the company in abeyance. The directions in the winding up order regarding appointment of the Official Liquidator and issuance of citation in the official gazette were also stayed. The result of this is that the respondent company continues to be free to deal with its assets in any manner it chooses to do so. It is deriving full advantage from the fact that the winding up order has been put in abeyance – it has avoided the consequences of the winding up order, the most important being the Official Liquidator taking charge of the company and all assets of the company. Such a company is pleading the existence of the winding up order to thwart the action of the landlord for being put in possession of the premises. The company is thus taking contradictory positions. For the present case it pleads existence of winding up order, while for all practical purposes it is enjoying the benefit of the said order having been put in abeyance. By being free to deal with the assets of the company, the respondent company is itself frustrating the very object of Section 446. Can the respondent company be allowed to approbate and reprobate in this manner? The respondent is not entitled to take contradictory stand.
(31) To conclude I am unable to accept the contention of the respondent that Section 446 of the Companies Act bars the present proceedings or the proceedings before the Controller.
(32) This brings me to the merits of the case. However, before I do that it will be appropriate to note the object of Section 21 of the Act and the law on the relevant aspects of this provision. The object of Section 21 was brought out in S.B.Naronah vs. Prem Kuman Khanna, . Section 14 of the Act, brought about restrictions on eviction of tenants. This made the landlords reluctant to let out their premises wherever they could afford to do so. The landlords felt that once they let out their property, the property was as good as lost to them. Section 21 created a category for special treatment which was kept out of the purview of the restrictions contained under Section 14 of the Act. The raison d’etre of the Section was presumably that Parliament was keen on maximising availability of accommodation for letting. “ONE source of such spare accommodation which is usually shy is potentially vacant building or part thereof which the landlord is able to let out for a strictly limited period provided he has some credible assurance that when he needs he will get it back. If an officer is going on other assignment for a particular period or the owner has official quarters so that he can let out if he is confident that on his retirement he will be able to re-occupy, such accommodation may add to the total lease-worthy houses. The problem is felt most for residential uses. But no one will part with possession because the lessee will become a statutory tenant and, even if bona fide requirement is made out, the litigative tiers are so many and the law’s delays so tantalising that no realist in his senses will trust the sweet promises of a tenant that he will return the building after the stipulated period. So the law has to make itself creditworthy. The long distance between institution of recovery proceedings and actual dispossession runs in to a decade or more – a factor of despair which can be obviated only by a special procedure.”
(33) Observations of the Supreme Court in Pukhraj jain vs. Padma Kashyap, Ii Scc 431 are also relevant in the present context. “WHATit, undoubtedly, projects is the legislative awareness of acute crisis of houses in the State. To resolve the paucity of accommodation, on the one hand, due to enormous influx of office personnel and business class as a result of rapid growth of social, economic and political activity and apprehension of house owners, on other, bulk of whom hail from middle class or service class of losing their houses if not for good then for substantial period due to development of strange phenomenon in big cities that allotted or rented houses are more economical than even own, the legislature which is the best judge of need of its people carved out an exception to usual rent control provisions of protecting tenants from eviction. Vacant possession was ensured, statutorily, without any notice, or termination of tenancy or the hazard of establishing bona fide need and comparative hardship etc. Since Section 21 is an exception to Section 14 and it mandates restoration of possession, “notwithstanding any other law” it has to be construed strictly and against any attempt to frustrate it. Intensity of it can be appreciated better, if its language is compared with other provisions of recovery of possession even though those provisions, namely, Section 14-A, 14-B, 14-C and 14-D, were introduced later. They also provide speedy remedy to recover possession. But the landlord cannot succeed unless he is able to prove circumstances mentioned in it. More than this the tenant has been given right to contest under Section 25-B. Import of Section 21 on the other hand is altogether different. It enjoins Controller to place landlord in vacant possession after expiry of time without any right to tenant to contest it except to the limited extent that permission was vitiated by fraud as held in S.B.Naronah vs. Prem Kumari Khanna or misuse of the provision by landlord taking advantage of helpless situation of the tenant as held in V.S. Rahi vs. Ram Chambeli or the permission really did not create genuine tenancy as held in Shiv Chander kapoor vs. Amar Bose. Recovery of possession under Section 21 is not hedged, by any inquiry or opportunity, if permission is not challenged on any of those exceptions which have been carved out by courts, obviously, to uphold fairness and honesty the core of our jurisprudance. Right to get vacant possession is, thus absolute.”
(34) Thus the Supreme Court recognised the tenant’s right to object to the order of grant of permission by the Controller. The tenants got encouraged to raise all sorts of objections at the expiry of period of lease which at least ensured their continuance in possession of the premises. This tendency on the part of tenants was checked through later decisions of the apex court. The practice of the Controllers of embarking upon roving inquiries at the instance of tenants was deprecated for the reason that it would frustrate the very purpose of limited period tenancy contemplated under Section 21. The decision of the Supreme Court in Shrisht Dhawan vs. Shaw Brothers, is the culmination of the controversies in this behalf. After considering the various judgments on the subject the legal position was stated as follows:- “Thus a tenant cannot wait for the entire period of lease and then raise objection to execution on fraud or collusion unless he is able to establish that it was not known to him and he came to know of it, for the first time only at the time of execution. In other words the Controller shall not be justified in entertaining an objection in execution unless the tenant establishes, affirmatively, that he was not aware of fraud before expiry of the period of lease. To the following extent, therefore, the law on procedural aspect should be taken as settled.
(1)Any objection to the validity of sanction should be raised prior to expiry of the lease.
(2)THEobjection should be made immediately on becoming aware of fraud, collusion etc.
(3)A tenant may be permitted to raise objection after expiry of lease in exceptional circumstances only.
(4)Burden to prove fraud or collusion is on the person alleging it.”
(35) In para 21 of the said judgment the law on the substantive safeguards in this context was stated as under:-
“(1)Permission granted under Section 21 of the Act can be assailed the tenant only if it can be established that it was vitiated by fraud or collusion or jurisdictional error which in context of Section 21 is nothing as except fraud and collusion.
(2)Fraud or collusion must relate to the date when permission was granted.
(3)Permission carries a presumption of correctness which can be permitted to be challenged not only by raising objection but proving it prim facie to the satsifiaction of Controller before landlord is called upon to file reply or enter into evidence.
(4)No fishing or roving inquiry should be permitted at the stage of execution.
(5)A permission does not suffer from any of these errors merely be cause no reason was disclosed in the application at the time of creation of short term tenancy.
(6)Availability of sufficient accommodation either at the time of gram of permission or at the stage of execution is not a relevant factor for deciding validity of permission.”
(36) The proposition that Section 21 of the Act is a self-contained Code needs no repetition. This has been so held by the Supreme Court repeatedly.
(37) Section 21 is reproduced as under:-
21.Recovery of possession in case of tenancies for limited period.
(1)where a landlord does not require the whole or any part of any premises for a particular period, and the landlord, after obtaining the permission of the Controller in the prescribed manner, lets the whole of the premises or part thereof as a residence for such period as may be agreed to in writing between the landlord and the tenant and the tenant does not, on the expiry of the said period, vacate such premises, then, notwithstanding anything contained in Section 14 or in any other law, the Controller may, on an application made to him in this behalf by the landlord within such time as may be prescribed, place the landlord in vacant possession of the premises or part thereof by evicting the tenant and every other person who may be in occupation of such premises.
(2)While making an order under sub-section (1), the Controller may award to the landlord such damages for the use or occupation of the premises at such rates as he considers proper in the circumstances of the case for the period from the date of such order till the date of actual vacation by the tenant.”
(38) From the aforesaid language of Section 21 it is clear that only two conditions are required to be satisfied for purposes of conferring jurisdiction on the Controller. Putting it differently, for the exercise of jurisdiction under this Section the Controller has to ensure:-
A)that the premises or any part thereof are not required by the landlord for a particular period;
B)the premises are let as a residence for the specified period.
(39) Besides the aforesaid two main requirements it is also necessary that the premises should be let after obtaining permission of the Controller and the period for which they are let must be agreed to between the parties in writing.
(40) The jurisdictional facts on the basis of which the Controller assumes jurisdiction under Section 21 are only two, i.e. non-requirement of the premises by the landlord for a particular period and the premises being let for residence only. If on the basis of existence of these facts the Controller passes an order under Section 21 granting permission for creation of a fixed term tenancy such an order is unassailable. The only protection to a tenant in such a case is on account of fraud in obtaining the Controller’s sanction. He is protected against a fraudulent landlord. He has to establish fraud and collusion in relation to the aforesaid jurisdictional facts.
(41) This means that at the time of grant of permission under Section, 21, the Controller is only concerned with the fact that the premises sought to be let out is not required by the landlord for a particular period and that the premises is being let for residence only. This is what the Controller is expected to be satisfied about before passing the order granting permission for creation of lease.
(42) The relevant facts in the present case in this context are that the petitioner No. I was appointed Chairman of the Hindustan Aeronautics Limited (for short HAL) and posted at Bangalore with effect from 3rd may 1980 for a period of five years. The petitioner No.2 was at that time aged about 60 years and was living with.her another son. This was the reason for their non-requirement of the suit premises for a specified period. The joint application was moved by the parties before the Controller with averments to the effect that the petitioners wanted to lease out the suit property for a fixed period of five years and six months starting with effect from 1st November 1980 for residential purpose only. The fact about the appointment of petitioner No. I as Chairman of Hal with effect from 3rd May 1980 for five years was stated in para 3 of the application. A copy of the appointment letter was annexed to the petition. It was further stated in para 4 of the application that “the respondent has fully satisfied itself that the petitioner No. 1 shall require the property in question for his personal residence on expiry of the fixed term period of five years and six months”. It was also stated that the property was not presently required by the petitioners for their use and occupation in view of the said appointment of petitioner No.l. Thus both the jurisdictional facts were stated in the joint application moved by the parties under signatures of the parties as well as their Advocates. A draft lease deed was also annexed to the joint application alongwith the site plan of the property. The period of lease was agreed to in -writing in the joint application as also in the proposed lease deed. This was followed by statements of representatives/constituted attorneys of both the parties recorded in Court on 31st October 1980. The statement made on behalf of the petitioners as AW-1 clearly states that the property was being let out for residential purposes for a specified period of five and a half years and the owners did not require the suit premises for five and a half years in view of appointment of petitioner No.l as Chairman of Hal, Bangalore and in view of the fact that petitioner No.2 was residing with her other son at Delhi and that the petitioner would be requiring the premises after expiry of five and a half years. Permission was sought on the basis of these facts. Thereafter the statement of the constituted attorney of the respondent company was recorded. He stated “I have heard the statement of AW-1. The same is correct. Ion behalf of respondents agree to take the premises as described in Ex.A-3 on rent from the petitioners. I also agree to vacate the premises after five and a half years on behalf of the company. I further agree that the premises shall be used only for residential purposes as per the proposed lease deed. The company shall vacate the premises after five and a half years. Permission may be granted”. On the basis of these facts the Addl.Rent Controller passed the order under Section 21 of the Act granting permission for creation of lease for five and a half years.
(43) On 11th November 1980 the formal lease deed was executed between the parties as per the draft lease deed which was annexed with the joint application for Commission to grant lease under Section 21 moved before the Controller. The only difference between the draft lease deed and the final lease deed executed between the parties is that the date of permission of Court and the particulars of joint application etc. have been mentioned in the final lease deed. These could obviously not have been mentioned in the proposed/ draft lease deed annexed with the joint application. The possession of the premises was also handed over to the tenant simultaneously. In view of the anticipated and approaching date of expiry of lease which was 30th April 1986, the petitioner No.l sent a reminder to the respondent company on 10th March 1986 asking the company to confirm the date on which it proposed to hand over possession of the premises and also permitting an inspection of the premises in the meanwhile by the landlord or his representative. The receipt of this notice is not denied by the respondent. On 19th April 1986, i.e. the 12th day before the expiry of the entire period of lease objections were filed against the order dated 31st October 1980 granting permission under Section 21 of the Act.
(44) The objections filed by the. respondent tenant can be broadly categorised as under:-
(1)The order granting permission under Section 21 of the Act was passed .in a mechanical manner, without application of mind by the Controller. The Controller did not satisfy himself about the fact that the premises was not required by the landlords for a particular period. The premises was available for indefinite letting. The statements made before the Controller were a mere pretense. The premises was being let out from time to time before the present letting. The petitioner No.2 in any case did not require the premises since she was residing with her other son.
(2)The permission can be granted by the Controller with respect to a premises which means that the premises should be in existence. In this case permission was granted with respect to a premises which was non-existent. The building had yet to be erected as per the proposed plans.
(3)The tenancy as per permission stood abandoned. A new tenancy was created vide lease deed dated 11th November 1980. This means that it was a normal lease meant for indefinite period otherwise why would the tenant be incurring such huge expense for the new construction? In fact there was an oral understanding between the parties as per which the tenant had to demolish the entire old structure and construct a new building at its own cost. The transaction was gone through before the Controller to avoid the provisions of Urban Land (Ceiling & Regulation) Act.
(4)THEpermission granted by the Controller is violative of the prohibitions contained in the Rent Control Act itself. Certain conditions of the lease deed dated 11th November 1980 as well as the agreement dated 11th November 1980 under which a sum of Rs.10 lacs was received by the landlords as interest free security were violative of the provisions of Delhi Rent Control Act as well as Section 23 of the Contract Act.
(45) Before dealing with these objections I have to consider the argument advanced on behalf of the petitioners that the objections cannot be entertained on account of delay in filing the same. The law is settled that the objections in this behalf can be entertained only if filed during the subsistence of the fixed term lease. There is no corresponding rule that objections filed during subsistence of lease must be tried. Any . objections filed after expiry of the lease period cannot be entertained except in exceptional circumstances. To bring his case within exceptional circumstances the tenant will have to satisfactorily explain the same. Further it is clear from J.R.Vohra (supra) as well as from Shrisht Dhawan (supra) the latest decision on the point that the objections to the validity of the order of permission should not only be raised during the subsistence of the lease but also they should be filed no sooner the tenant discovers facts and circumstances that tend to vitiate ab initio the initial grant of permission. In all the cases in between also the twin requirement that objections be filed during currency of lease and no sooner that the tenant discovers facts which vitiate the order of grant of permission has been accepted and emphasised. The allegation of fraud in its very nature is such that it must be brought to the notice of the Court at the earliest. He who alleges fraud must do so promptly. I had occasion to deal with this aspect in one of my earlier decisions on the point in Sunil Pun vs. Modi Spinning & Weaving Mills Ltd., . In para 21 it was observed as under:- “APART from the question of conflicting claims on the basis whereof the aforesaid view has been taken by the Apex Court I feel that to judge the bona tides of the stand of the tenant also it is important that the attack should have been made at the earliest. If the facts on the basis of which the challenge is laid were in existence at the time of grant of permission why should the tenant not have them tested before the authorities immediately? The mere fact that the challenge is made after the expiry of the period of lease shows that it is by way of an after thought and to gain time as far as possible in order to stick to the possession of the premises. Generally the facts on which the challenges are laid by the tenants in such cases belong to the stage of grant of permission under Section 21 which are known to the parties. When the necessary facts are available there is no reason why the tenant should not approach the authorities immediately if his challenge is bona fide, genuine and if he is serious about it. Just like the principle that fraud vitiates everything, it is quality important that fraud should be brought to light and appropriate remedies sought qua it at the earliest.”
(46) The said judgment was upheld by the Supreme Court in as much as a Special Leave Petition filed by the tenant was dismised.
(47) In the present case the objections were filed during the subsistence of the lease, i.e. 12 days before the period under the lease was to expire. The learned counsel for the objector submits that this makes the objections in the present case maintainable and they must be tried on evidence. The Addl.Rent Controller accepted the argument and passed the impugned order. The question is just because the objections are filed during subsistence of lease, may be on the last day, must they be Conlained?lf a statute prescribes period of limitation for filing objections, the objections can be filed up to the last date of limitation and nobody can question it. But here there is no statutorily prescribed period of limitation. It is a limitation worked out as a rule of prudence through decisions of Court. The compliance has to be in the spirit of the rule and not just literal compliance. The object of prescribing the limitation should be kept in consideration.
(48) The facts regarding jurisdiction of the Controller to pass the order of permission pertain to the stage of grant of permission by the Controller. Therefore, the tenant must challenge the same soon after passing of the order of permission. If the tenant is allowed to wait till the entire period of tenancy is over it will obviously mean that the objections are filed only to delay delivery of possession of the premises to the tenant which means that the objections are an after thought and also mala fide. In the present case all the facts being pleaded in the objections are of the time of granat of permission. They were all within the knowledge of the tenant at that time. Further the tenant has not stated anything in the objections by way of explanation for approaching the Court at the fag end when the period of lease was about to be over. There is not even a whisper as to why the tenant did not approach the Court “no sooner than it discovered facts which according to the tenant ab initio vitiate the order of grant of permission”. The requirement that objections must be filed during the subsistence of the lease is to be understood in the right perspective. It is not a question of only meeting a dead line. It is really intended to ensure that the tenant acted in a bona fide manner and challenged the order of permission at the earliest and during the subsistence of lease. When an order is challenged during subsistence of lease, the tenant runs the risk of permission being set aside and he being called upon to restore possession of the premises. Approaching the Court almost when the entire period of lease has run its course only shows that the tenant did not want to run such a risk and comes to Court after enjoying the lease period almost in full.
(49) I am of the considered view that merely because the objections in the present case were filed about 12 days before the expiry of the period of fixed term tenancy, i.e. five and a half years, it cannot be held that they must be entertained. The objections fail to meet the requirement about the same being filed no sooner than the tenant discovered such facts which ab initio vitiate the order of grant of permission. The following observations of the Supreme Court in Pankaj Bhargava vs. Mahinder Nath, need to be noted in this context:- “IT is true that in Naronah’s case a challenge to the validity of the limited tenancy was permitted even after the period of limited lease. But later cases have substantially denuded this position. In Vohra’s case , this Court laid down that a tenant who as sials the permission under Section 21 on the ground that it was procured by fraud – a ground not dissimilar to the one urged in the present case – must approach the Rent Controller during the currency of the limited tenancy for an adjudication of his pleas as soon as he discovers facts and circumstances which, according to him, vitiate the permission, It was held that whether it was a “mindless order” or one procured by fraud practised by the landlord or was the result of a collusion between landlord and tenant there was no justification for the tenant to wait till the landlord made his application for recovery of possession but there was every reason why the tenant should have made an immediate approach to the Rent Controller to have his pleas adjudicated as soon as facts and circumstances giving rise to such pleas came to his knowledge.
(50) The reason why this requirement was built in working the rights and obligations under Section 21 was the need to reconcile and harmonise certain competing claims that arise in administering the scheme of Section 21. This Court, referring to these competing claims observed: “WHAT then is the remedy available to the tenant in a case where there was in fact a mere ritualistic observance of the procedure while granting permission for the creation of a limited tenancy or where such a permission was procured by fraud practised by the landlord or was a result of collusion between the strong and the weak? Must the tenant in such cases be unceremoniously evicted without his plea being inquired into? The answer is obviously in the negative. At the same time must he be permitted to protract the delivery of possession of the leased premises to the landlord on a false plea of fraud or collusion or that there was a mechanical grant of permission and thus defeat the very subject of the special procedure provided for the benefit of the landlord in Section 21 The answer must again be in the negative….”
(51) The manner in which the Court harmonised and reconciled these competing and conflicting claims and interest watched by insisting upon the tenant to approach the Rent Controller for adjudication of his pleas as soon as he discovered that the initial grant of permission stood vitiated. This was evolved as a part of policy of law for the reconciliation of divergent and competing claims. It was held: “….INour view these two competing claims must be harmonised… by insisting upon his approach the Rent Controller during the currency of the limited tenancy for adjudication of his plea no sooner he discovers facts and circumstances that lend to vitiate ab initio the initial grant of permission. Either it is a mechanical grant of permission or it is procured by fraud practised by the landlord or it is result of collusion between two unequals but in each case there is no reason for the tenant to wait till the landlord makes his application for recovery of possession after the expiry of the fixed period under Section 21 but there is every reason why the tenant should make an immediate approach to the Rent Controller to his pleas adjudicated by him as soon as facts and circumstances giving rise to such pleas came to his knowledge or are discovered by him with due diligence…”. This has been reiterated in the cases of Shiv Chander kapoor and Yamuna Maloo :
(52) A tenant who approaches the Controller soon after discovering facts which according to him vitiate the order of grant of permission, clothes his conduct with legitimacy, genuineness and bona fides. However, if he waits till the expiry of the period of lease or till the lease has run its course, a cloud is cast on bona fides of his action. It only shows his mala fide attempt to ward off his liability to vacate the premises as long as possible. Thus it cannot be said as a rule of law that objections filed during the currency of lease must be entertained while objections filed after the expiry of lease, even though a few days later, must be rejected. The real thing to be seen is the conduct of tenant in approaching the Court with utmost diligence, a few days here or there, i.e. a few days before the expiry of lease or after the expiry of lease are not so much material. That is why in exceptional circumstances objections filed even after the expiry of the fixed period of tenancy can be entertained. The crux of the matter is the conduct of the tenant in approaching the Controller. This conduct has to be tested with reference to the fact that the challenge to the order of grant of permission for fixed term tenancy is based on facts prevailing at the stage when the order is passed. In normal course why such facts should not be challenged soon after the order of grant of permission for lease and the tenant should allow the full course of the fixed term tenancy to run before he approaches the Controller. The bona fide of the act of the tenant in challenging the order of grant of permission lies in challenging the order at the earliest. Delay in doing so robs the challenge of all its legitimacy, force or substance. It renders the challenge a mere after thought and mala fide.
(53) The following observation of the Supreme Court is Yamuna Maloo, really conclude the issue: “….if the tenant has objection to raise to the validity of the limited tenancy it has to be done prior to the lapse of the lease and not a defense to the tenant’s application for being put into possession. We would like to reiterate that even if such an exercise is available that must be taken to be very limited and made applicable to exceptional situations. Unless the tenant is able to satisfy the Controller that he had no opportunity at all to know the facts earlier and had come to be aware of them only then, should such an objection be entertained.”
(54) The next question is about the scope of inquiry before the Controller when objections are filed challenging the order of grant of permission for limited tenancy. Basing myself on the settled legal position emerging from the various decisions of the Supreme Court on the point I had occasion to say as follows on this aspect in an earlier judgment in Swam Kanta Mehra vs. VinayK.Mahendra, :- “The next question which arises for consideration is as to what is the scope of enquiry before the Controller at the instance of a tenant in such an event? The enquiry has to be limited only to the existence of jurisdictional facts, i.e., facts which give jurisdiction to the Controller to pass the order regarding permission to create limited tenancy. As already noticed the jurisdictional facts are only two. The Controller has to be satisfied that the landlord does not require the premises for a limited period and the premises are let for residence as per an agreement in writing between the landlord and the tenant. On satisfaction of the existence of these facts the Controller grants permission for creation of a tenancy for a limited period under Section 21. The Controller is not expected to embark upon any enquiry about existence of these facts or otherwise. The objective of Section 21 as already stated is to permit creation of tenancies for a limited period. This object should not be permitted to he frustrated by entertaining pleas on the part of a tenant which seek to unduly enlarge the scope of the inquiry at a later stage. A tenant who having given his free consent for creation of a limited tenancy thereafter attempts to thwart restoration of possession to the landlord by raising untenable pleas inspite of prohibition contained in the words nothwithstanding anything contained in Section 14 or any other law” in Section 21 of the Act, cannot be permitted to abuse the process of Court. It has been held in Shiv Chander Kapur, (supra) that “this being the scope of his inquiry while granting permission, the scope of inquiry at the subsequent stage cannot be wider. For this reason any objection regarding the validity of permission on a ground other than non-existence of jurisdictional facts at the time of grant of permission is untenable and beyond the scope of the Controller’s power to examine validity of his earlier permission before directing restoration of possession to the landlord under Section 21 of the Act. Thus the inquiry envisaged in this connection is a very limited inquiry about the existence or non-existence of jurisdictional facts. The tenant can be allowed to attack the order regarding grant of permission only on the ground of absence of jurisdictional facts which would render the order of grant of permission wholly without jurisdiction. Total absence of jurisdiction is different from error in exercise of jurisdiction. An authority which has power to exercise jurisdiction may exercise its jurisdiction rightly or wrongly.”
(55) In this context I feel further fortified from the following observations of the Supreme Court in Pankaj Bhargava (supra). In para 14 of the report:- “in view of the pronouncements of this Court as to the limitations on the permissible challenge to the exercise of jurisdiction under Section 21, any appeal to the remedy based on concept of nullity and collateral attack is inappropriate. Suffice it to say that in a collateral challenge the exercise is not the invalidation of a decision, but only to ascertain whether the decision “exists” in law at all and to rely upon incidents and effect of its “non-existence”. The authority of decided cases is to the effect that the permission granted must be presumed to be valid till set aside. Doctrine of collateral challenge will not apply to a decision which is valid ex- hypothesi and which has some presumptive existence, validity and effect in law. Such a decision can be invalidated by the right person in right proceedings brought at the right time. It is only a nullity stemming from lack of inherent jurisdiction or a proceeding that wears the brand of invalidity on its forehead that might afford a defense even against enforcement. Shri Sachar is right in his contention that such a collateral challenge may not be available where there is no lack of inherent jurisdiction but what is disputed is only the existence or non-existence of facts which though collateral to the merits do require investigation into and adjudication upon their existence or non-existence on the basis of evidence. If the parties before the Rent Controller have admitted that the fact or the event which gives the Controller jurisdiction is in existence and there was no reason for the Controller to doubt the bona fides of that admission as to a fact or event, the Controller is under no obligation to make further enquiries on his own as to that factual state. The test of jurisdiction over the subject-matter is whether the Court or Tribunal can decide the case at all and not whether the Court has authority to issue a particular kind of order in the course of deciding the case”.
(56) I have already categorised the objections of the tenant herein before and now I proceed to deal with the same in the background of the aforesaid scope of inquiry.
OBJECTIONNo.1
ACTUALLY it is only the first objection which can be said to be falling in the category which is permitted as a ground of challenge. Under this objection the tenant in substance says that the first requirement for jurisdictional facts, i.e. availability of the premises for being let out for a particular period was not met. According to the tenant the premises was being let out earlier from time to time and was available for indefinite letting. The Controller should have enquired into this and inquiry on these facts would have shown that the premises was available for indefinite letting, which in turn would have rendered it impossible to grant permission for fixed term tenancy. In this connection the first question which arises is as to what is the requirement regarding pleadings as to availability of premises for a particular period. It has been held by the Supreme Court in its various judgments* that there is no requirement to plead before the Controller the reasons for non requirement of the premises for a particular period. It also follows from these decisions that facts about previous letting of the premises need not be stated. Therefore, non statement of the fact about the previous letting of the premises cannot constitute fraud within the meaning of Section 21. In Dhanwanti Devi , it was held that even successive letting under Section 21 prior to grant of sanction could not adversely reflect on the grant of permission as it was reasonable for landlord to let out looking to immediate future.
THUS the landlord was not required to state in the joint application for permission that the premises was let out earlier to other tenants. There could be no fraud in not making such averment. Even if such averment was made in the joint application it could not prevent the Controller from granting permission.
2.Joginder Kumar Butan vs. R.P.Oberoi, ;
3.Pankaj Bhargava (supra); and
4.Shrisht Dhawan (supra)
(57) Another strong reason for rejecting the objection is the admissions of the tenant on this aspect. The Supreme Court held in Pankaj Bhargava (supra) “if parties before the Rent Controller have admitted the fact or the event which gives the non-exiler jurisdiction is in existence and there was no reason for the Controller to doubt the bona Fides of that admission as to a fact or event, the Controller is under no obligation to make further inquiries on his own as to that factual state”. The Court proceedings at the stage of grant of permission by the Controller in this case may be recalled. In the joint application moved before the Controller it was stated that the petitioners are the owners of the suit property comprising a double storey residential house. Further it was stated that the petitioners were desirous of leasing out the said property for a fixed period of five and a half years starting from 1st November 1980 for residential purpose. It was also stated in para 3 of the joint application that petitioner No.l had recently been appointed Chairman of Hal, Bangalore. The appointment was for a period of five years w.e.f. May 1980. A copy of the letter of appointment was annexed. Further in para 4 it was stated in the joint application “the respondent has fully satisfied itself that the petitioner No.l shall require the property in question for his personal residence on expiry of the fixed term period of five years and six months”. The petitioner No.l stated that he would require the premises for his personal residence on expiry of the period of lease. It was a joint application signed by both the parties. Statements were recorded before the Addl.Rent Controller on 31st October 1980 on behalf of both the parties. The constituted attorney of the petitioner stated on oath that the “owners do not require the same for a period of five and a half years since the petitioner No.l has been appointed as Chairman of Hal, Bangalore. The petitioner No.2 is residing at Delhi with one of her sons. She also does not require the premises at present. The petitioner shall require the premises only after five and a half years and permission is sought accordingly for creating a limited tenancy”. After the statement of the attorney of the petitioners the statement of constituted attorney of the respondent tenant was recorded. He stated amongst other things “I have heard the statement of AW-1 (referring to the statement of petitioner’s constituted attorney), the same is correct. I on behalf of respondents agree to take the premises as described in Ex.A-3 on rent from the petitioners. I also agree to vacate the premises after five and a half years on behalf of company. I further agree that the premises shall be used only for residential purposes as per the proposed lease deed. The company shall vacate the premises after five and a half years. Permission may be granted”. The proposed lease deed was also annexed to the joint application.
(58) The statements of the parties show that they agreed to the terms of the proposed lease deed. The proposed lease deed contains statements to the effect that petitioner No.l was appointed as Chairman of the Hal, Bangalore and that he will require the suit premises for his own personal use after the expiry of the Fixed term tenancy. It also contains the statement “And whereas the lessee having satisfied itself that the lessor shall require the said premises on expiry of the said period for personal use and occupation of the afore mentioned Shri B.K. Kapur”. The aforesaid proceedings clearly establish admissions on the part of the respondent tenant about the fact that the premises were not required by the petitioners for the period of the fixed term tenancy. The specific admission of the respondent that the respondent had specified himself in this behalf leaves no scope for the argument now being advanced on behalf of the respondent challenging veracity of these facts. In any case the Controller had no reason to doubt these admissions. There was nothing to arouse his suspicion. In this respect the following observations of the Supreme Court in Inder Mohan Lal vs. Ramesh Khanna, , are also very pertinent:- “But if at the time of passing of a decree there was some material before the court on the basis of which the court could prima facie be satisfied about the existence of a statutory ground for eviction, it would be presumed that the court was so satisfied and the decree for eviction, though passed on the basis of the compromise would be valid. Such material may be in the form of evidence recorded or produced or it may partly or wholly be in the shape of express or implied admissions made in the compromise agreement. Sarkaria, J. speaking for the court held that admissions if true and clear were by far the best proof of the facts admitted especially when these were judicial admissions admissible under Section 58 of the Evidence Act. In that case the court found because of the admission to pay the arrears of rent and mesne profits at the contractual rate and the withdrawing of his application for fixation of standard rent, that there was no disspule with regard to the amount of standard rent and there was an admission that the rent was in arrears. The court observed at pages 552 to 553 of the report as follows: (SCC pp. 251-52, para 27)
(59) From a conspectus of the cases cited at the bar, the principle that emerges is, that if at the time of the passing of the decree, there was some material before the court, on the basis of which, the court could be prima facie satisfied, about the existence of a statutory ground for eviction, it will be presumed that the court was so satisfied and the decree for eviction though apparently passed on the basis of a compromise, would be valid. Such material may take the shape cither of evidence recorded or produced in the case, or, it may partly or wholly be in the shape of an express or implied admission made in the compromise agreement, itself. Admission, if true and clear, are by far the best proof of the facts admitted. Admissions in pleadings or judicial admissions, admissible under Section 58 of the Evidence Act, made by the parties or their agents at or before the hearing of the case, stand on a higher footing than evidentiary admissions. The former class of admission are fully binding on the party that makes them and constitute a waiver of proof. They by themselves can be made the foundation of the rights of the parties. On the other hand, evidentiary admissions which are receivable at the trial as evidence, are by themselves, not conclusive. They can be shown to be wrong.
(60) In view of the aforesaid position in law, no further inquiry by the Controller was necessary or required in the facts of the present case about the availability of the suit premises for being let out for a particular period. The existence of jurisdictional facts cannot be questioned and the order of grant of permission by the Controller can not be assailed on this ground.
(61) The learned counsel for the objector also termed the order of the Controller granting permission for limited period tenancy in the present case as a mindless order.
ON what is mindless order the Supreme Court had occasion to say in Shrisht Dhawan (supra)
“…..ANaction is mindless when it is thoughtless or without any care or caution. In law it is passing of an order without any regard to the provision of law. If the section requires the authority to pass an order on inquiry or on being satisfied of existence or non-existence of a fact then the duty cast is higher and an order which is passed without due regard to duty to investigate then the order may be mindless. But in absence of any statuory requirement it may utmost be regulatory oversight. In the context of Section 21 it is clear that there is no statutory requirement for the Controller to enter into enquiry on application made by a landlord supported by a statement and agreed to by the tenant.
BUT in absence of any material to indicate to the contrary if the Controller grants permission on the mere statement in the application that the premises was available for being let out for a short time as it was not required by the landlord and it is supported by a statement recorded before Controller which is not objected to by the tenant rather agreed then it would be too much to say that the exercise of power was made thoughtlessly
(62) These observations in the context of facts of the case leave no scope for the argument that the order of grant of permission was a mindless order.
(63) Objection N0.2 The next objection of the tenant is based on the plea that permission under Section 21 has to be with respect to a premises. In the present case, according to the tenant, the premises subject matter of the tenancy was not in existence at the time of grant of permission. The contention is that permission was granted with respect to a non-existent premises which renders the order of grant of permission illegal and void. To examine this objection first reference is again to be made to the joint application, The very first paragraph records that the petitioners are owners of property No.46, Friends Colony, New Delhi comprising of double storey residential house, more fully shown as coloured red on the plan. The plan of the property was annexed to the joint application. The statement of the constituted attorney of the tenant runs “I on behalf of respondents agree to take the premises as described in Ex.A-3 on rent from the petitioners”. Ex.A-3 was a plan of the property. Similarly the proposed lease deed filed along with the joint application which is also accepted in the statement of the constituted attorney of the respondent tenant, contains recital as under:- “Whereas the lessors are the owners in possession of the property known as 46, Friends Colony, New Delhi comprising of the land and the double storeyed residential house consisting of a single unit dwelling house with back, front and side laws, servant quarters and garage blocks”. With these admissions which have not been even challenged so far, is the tenant entitled to raise the objection that there was no premises in existence? The answer is clearly a firm “no”. The landlord and the tenant had in the present case agreed to certain modifications and alterations being carried out in the premises. The modifications and alterations could be carried out only to the extent agreed to between the parties as per proposed modification plan filed with the Municipal Corporation of Delhi for its approval. The landlords authorised the tenant to pursue the matter regarding sanction of plan with the M.C.D. for which purpose special power of attorney was granted in favour of a director of the tenant company. This permission to carry out the modifications/additions and alterations in the premises is being made the basis to raise the objection under consideration. The permission was granted by the landlords for the benefit of the tenant. The work was to be carried out by the tenant at his own expense subject, however, to permission by the concerned governmental authorities. There was no permission for demolition of the entire existing structure or for putting up a completely new structure. If the tenant abused the permission and carried out the work contrary to the permission granted by the landlords, it cannot be allowed to take advantage of its own wrong. The tenant cannot be permitted to raise this objection. The existence of premises which was subject matter-of lease was never in dispute. The lease was granted with reference to an existing premises. The proceedings recorded before the Addl.Rent Controller, the joint application and its annexures, i.e. the plan of the property and the proposed lease deed and the lease deed duly executed between the parties subsequently on 11th November 1980 clearly point to existence of a premises with respect to which the permission was granted by the Controller. The record of the proceedings, the joint application, the proposed lease deed, the plan of the premises annexed with the joint application and the final lease deed are not at all challenged. These all have been acted upon. The tenant can not be heard to say anything to the contrary at this stage.
(64) Apart from the fact that the argument is totally misconceived, having no foundation for it, it is wholly mala fide. The permission granted by the landlord to the tenant for carrying out the additions/alterations/modifications in the premises was at the request of the-tenant. Something allowed for the benefit of the tenant and at the instance of the tenant is being misused by the tenant to raise the present objection. This cannot be permitted. Another thing to be noted in this behalf is that the tenant was permitted to terminate the lease earlier by three months’ notice if it could not carry out the additions/alterations. There was no corresponding such right reserved for the landlords. This also conclusively shows that the permission granted by the landlords for additions/alterations in the premises was for the benefit of the tenant and was at the instance of the tenant.
(65) Looking at it from another angle, if there was any fraud by the landlords in this behalf the tenant should have immediately approached the Court and said that there was no premises in existence. Instead the tenant went ahead with the work of additions and alterations. The formal lease deed and a separate agreement were executed on 11th November 1980, i.e. more than ten days after the order of grant of permission. If there was any fraud by the landlords, the tenant should not have executed these documents and should have refused to take the premises as per the permission of the Controller under Section 21 of the Act. By that time the tenant had not suffered any detriment. The additions/alterations in any case would have formed part of the existing building. It cannot be said that there was no existing premises. The definition of the word ‘premises’ in the Delhi Rent Control Act is an inclusive definition. The objection regarding non-existence of premises at the time of grant of permission under Section 21 is accordingly rejected.
(66) It has to be kept in mind that an executing Court cannot go behind the decree. As noted earlier there is no challenge to the proceedings before the Controller. No dispute has been raised about the fact of moving a joint application alongwith annexures which were agreed upon and about recording of statements before the Controller. A decree was passed on the basis thereof. The proceedings achieved a finality. They were duly acted upon.
(67) Objection N0.3 Objections under this category are based on an alleged oral understanding between the parties regarding the transaction of lease of the suit property. In substance the contention of the respondent tenant is that an oral understanding had been reached between the parties in October 1980 regarding lease of the suit premises. Under this oral understanding the existing structure/premises was to be demolished and a new building was to be constructed in its place. Section 21 procedure was only gone through to avoid the provisions of Urban Land (Ceiling & Regulation) Act. If the building was to be demolished and plans were to be got sanctioned for a new building, a substantial chunk of the land would have gone to the state as per the provisions of the said Act. According to the tenant, really it was intended to be an indefinite lease that is why the tenant incurred such a heavy cost in putting up a modern building at the site. If the premises was to be let out only for a period of five and a half years, no reasonable person would incur such heavy cost. Such objections arc not open to the respondent tenant for various reasons. First, as per settled law a tenant can only challenge the order of grant of permission under Section 21 on the ground of absence of jurisdictional facts or on the ground of fraud and collusion in conferring jurisdiction on the Controller. The objection does not fall in the category of fraud or collusion in relation to jurisdictional facts. Secondly, reference has already been made to the joint application of the parties before the Controller for permission to create fixed term tenancy. Reference has also been made to statements of duly constituted attorneys of the parties recorded on oath before the Controller. All these were followed by the order of the Additional Rent Controller granting permission. This happened on 31st October 1980. Thereafter the formal lease deed was executed between the parties on 11th November 1980. The lease deed is as per the draft lease deed which was filed before the Controller as annexure to the joint application for permission except that particulars of the Court and date of the order of the Controller etc. have been mentioned in the final lease deed which obviously could not be contained in the draft of proposed lease deed. The final lease deed refers to the fact that it was being entered into in pursuance to the permission of the Controller to create fixed term tenancy. The relevant recitals in the final lease deed are as under:-
And whereas on an application made by the parties in the court of Shri Kuldip Singh, Rent Controller, Delhi, the lessors have by an order dated 31.10.1980 passed in Petition No. M-280/80, been granted permission to lease out to the lessee herein the said premises for a fixed period of five years and six months starting 1st November, 1980.
And whereas the lessors are, pursuant to the aforesaid permission granted to them by the Rent Controller, Delhi, executing this lease in favour of the lease on the terms and condition hereinafter contained.
(68) Besides the above, on 11th November 1980 an agreement was also executed between the parties in pursuance of which a sum of Rs.ten lacs was given as security to the landlords by the tenant. It is only on execution of the aforesaid documents that possession of the premises was handed over by the landlord to the tenant. These documents have not been challenged or disputed. In view of these admissions in Court proceedings and execution of documents which are admitted, a party is not entitled to raise pleas to the contrary and that too on the basis of an alleged oral understanding. As already noted admissions in judicial proceedings and in statements made on oath in Court or in pleadings enjoy a high degree of sanctity. The parties cannot be allowed to wriggle out of the same.
(69) The objector wants to lead oral evidence to establish the all egeed oral understanding. Oral evidence is barred under the provisions of Sections 91 and 92 of the Indian Evidence Act, 1872. The terms of lease were required by law to be reduced into writing which were in fact reduced into writing. No oral evidence of something to the contrary is permissible or admissible. The tenant/objector is a party to the written documents regarding grant of lease. For contradicting, varying, adding or subtracting from the terms contained in the written document, oral evidence is barred under the said provisions of law.
(70) Lastly, it will be noted that the order of grant of permission which led to the execution of the lease deed and putting the tenant in possession of the property are all things which have been duly acted upon. The tenant enjoyed the benefit under these. It allowed the full course of the documents to run. At the fag end, i.e. when the period of fixed term tenancy was almost over, the tenant has come forth with all .sorts of objections. It is obviously a mala fide attempt to protract litigation in order to continue in possession of the premises as far as possible. In the process the tenant/objector has succeeded in retaining the possession of the premises illegally and unauthorisedly for almost ten years after the expiry of lease. It is a sheer abuse of the process of the Court. The objections under this head are rejected.
(71) Objection N0.4 The last category of the objections of the tenant are that the order of grant of permission contravenes Sections 5 and 48 of the Delhi Rent Control Act. It also is in violation of Section 23 of the Contract Act. It is submitted that if certain terms of the lease were prohibited under the law, the lease will be a nullity and, therefore, the landlords cannot seek to evict the tenant by virtue of the provisions of section 21 of the Act.
(72) In support of his argument the learned counsel for the objector has drawn my attention to clause 3, Sub-clause (vi) of the lease deed. The said clause is reproduced as under:- “(VI)It is agreed by and between the parties that certain additions and alterations are to be carried out in the said property. Building plans covering the alterations and additions that are required to be made have already been filed with the Corporation. A copy of the said plan is attached herewith. It is agreed that the additions, alterations and renovations in terms of the plans already filed, ( A copy of which is enclosed herewith) shall be carried out by the lessee for and on behalf of the lessors. All expenses and cost in respect thereof shall be borne by the lessees. The said cost and expenses shall, however, not be recoverable by the lessees from the lessors at any stage and not even on expiry of the period of lease stipulated herein. The said cost shall be adjusted at compensation payable to the lessors for the grant of this lease in addition to the rent hereinbefore reserved. The premises hereby agreed to be leased shall include the additions, alterations and renovation hereafter carried out to the property in terms of the aforesaid plans. The lessors agree and undertake to sign all such applications, plans, documents and representations as may be necessary for getting the plans approved for undertaking the proposed additions and alterations and for getting the plans sanctioned the lessors shall execute a special power of attorney in favour of such nominee of the lessee so may be designated in term of Annexure–hereto.”
(73) It is submitted that such things are barred under Section 5 of the Delhi Rent (control Act. It is further submitted that Section 48 makes such violations punishable. The learned counsel for the objector submits that the cost of additions/alterations which the tenant had to bear and for which the tenant was not entitled to any reimbursement is obviously compensation, received by the landlords in addition to rent which is prohibited under Section 5 of the Delhi Rent Control Act. It is further added that what is hit by Section 5 of the Rent Act is also hit by Section 23 of the Contract Act. In support of this very argument counsel for the objector has also relied on the agreement under which a sum of Rs.10 lacs was paid to the landlords by way of security. It is stated that payment of Rs.len lacs by wav of security which was interest free was contrary to law and if this was brought to me notice of the Controller at the initial stage he would not have grimed the permission under Section 21. It is also submitted that in spite of knowledge of this fact the Controller granted permission it will be deemed to be a mindless order and the court will not give effect to it.
(74) In reply to these arguments the learned counsel for the landlords submitted that the lease deed admittedly executed between the parties only mentions about the payment of rent. In clause (vi) relied upon by the objector which is quoted here in before, there is no mention of any amount to be spent by the tenant for purposes of renovations or additions etc. There is no insistence from the side of the landlord requiring tenant to carry out additions, alterations in the premises. The landlord has only granted permission to the tenant as per the request of the tenant to do this. The tenant was free not to carry out any additions, alterations etc., if so desired. Thus permission granted to the tenant for its own sake and convenience and as per its own request cannot be taken against the landlords. There was no compulsion on the tenant to do this or carry out the proposed works. The only object behind this clause was that in the event of the tenant carrying out such additions/alterations he may not insist upon the landlords to foot the bill for the same. The purpose of clause (vi) was to ensure that the liability on this account is not passed on by the tenant to the landlord. No amount is mentioned in the clause nor even an outer limit is stated. Whether additions, alterations would be carried out at all and if so, to what extent and at what cost, both the things were in the domain of uncertainty and were totally in the hands of the tenant. Such a thing could not be made the basis of an argument of this nature. Further option was given in the lease to the tenant to terminate the lease if it failed to carry out the works as proposed by it. No corresponding option was given to the landlords. Regarding the other limb of this argument, i.e. alleged receipt of premium by the landlords in the shape of interest free security, the learned counsel for the landlords submitted that there is no bar to receiving interest free security in the Act. In the ordinary law relating to leases there is no bar to such acts. The bar or control has been brought about only by the provisions of the special statute, i.e. the Delhi Rent Control Act. Section 13 of this Act envisages that if there is any such violation of the Act an application has to be moved to the Controller by the aggrieved party and then the Controller has to decide the matter and order refund etc.. It is submitted that the tenant/objector never made any such application before the Controller. If the tenant had any grievance in this behalf he should have approached the Controller. Therefore, it is argued that this objection is not open to the tenant. If the tenant wanted to enforce the right under these provisions of the Act it was free to do so. The tenant failed to do so. Section 13, it is to be noted, provides a period of limitation of one year from the date of such payment to approach the Controller. The tenant never invoked the said provision. This only shows that the present objection is only an after thought and is being raised only to thwart the process of handing over possession of the premises to the landlords. This answers the objection regarding incurring cos.t of construction which was not refundable as well as payment of Rs.l0 lacs as interest free security. These acts per se not being barred under the ordinary law, cannot be said to be violative of Secti23 of the Contract Act. The bar has been brought about by the Delhi Rent Control Act which itself provides remedies and penal provisions. The tenant never invoked the provisions of the Act and, therefore, cannot be permitted to raise such objections.
(75) The result is that all the objections filed by the respondent/tenant are held to be totally misconceived, untenable and not entertainable. They have been filed non-exily for the mala fide object of protracting the litigation and to ensure that the tenant continues to enjoy possession of the premises as long as possible. No evidence could be allowed to be led on objections of the tenant. The impugned order of the Addl.Rent Controller is totally illegal, and is violative of the clear mandate of the Supreme Court as per the various judgments referred to earlier The impugned order amounts to failure/refusal to exercise jurisdiction vested in the Additional Rent Controller. It has resulted in grave miscarriage of justice. Permission to the tenant to lead evidence on such objections means years of trial on something which cannot be entertained at all. The impugned order of the Additional Rent Controller is set aside. The objections of the tenant are dismissed. The objector/tenant is directed to hand over peaceful vacant possession of the entire property bearing No.46, Friends Colony, New Delhi to the petitioners within four weeks failing which the Additional Rent Controller is directed to issue warrants of possession with police aid and orders for breaking open the locks and doors of the premises in order to ensure immediate delivery of possession of the entire property to the landlords. This petition is disposed of in these terms.