ORDER
Shivaraj Patil, J.
1. The following are the two questions of law referred to the Full Bench for decision under Section 7 of the Karnataka High Court Act:-
1) Whether mortgagee in possession would be a landlord for the purpose of Section 21(l)(h) of the Karnataka Rent Control Act, 1961? And
2) Whether a tenant under him would become statutory tenant?
2. The brier facts leading to this reference are:-The premises is a garage forming portion of a building bearing No. 4, 1st Cross, Kumarapark West, Bangalore-20. It belongs to the 2nd respondent. The first respondent became the tenant under the 2nd respondent. The 2nd respondent mortgaged with possession the entire ground-floor of the building bearing Corporation No. 4, including the garage with possession in question under registered Mortgage Deed dated 18-5-1979. At the request of the 2nd respondent, the tenancy in respect of the garage portion was attorned by the 1st respondent in favour of the petitioner-mortgagee.
The petitioner filed petition for eviction under Section 21(1)(h) of the Karnataka Rent Control Act, 1961 (hereinafter referred to as ‘the Act’ for short) seeking eviction of the said 1st respondent from the garage portion of the said building No. 4 in HRC.No. 326/ 1981 in the Court of the Small Causes Judge, Bangalore City. The learned Small Causes Judge, Bangalore City, by his order dated 9-2-1983 dismissed the petition filed for eviction holding that the petitioner does not come within the ambit of the word ‘landlord’ vis-a-vis respondent-1. Being aggrieved, the petitioner filed this Civil Revision Petition.
3. The learned Single Judge Hakeem, J. by his Order dated 30-9-1986 referred this matter to the Division Bench of this Court for its consideration observing thus:-
“The main question that arises for consideration is whether a possessory mortgagee can prefer or maintain a claim for eviction of the tenant on the ground under Clause (h) of Section 21(1) of the Act. Since this is a question of law of general importance which arises before this Court frequently, I consider it necessary that the same should be decided by the Division Bench.”
4. The Division Bench of this Court in the Order under reference has stated thus:-
“Learned Counsel appearing for petitioner relying on the decision of the Full Bench of this Court in B. VlJENDRA v. HOUSE RENT AND ACCOMMODATION CONTROLLER contended that if the usufructuary mortgagee can be held to be a landlord within the meaning of Section 3(h) of the Act ‘proprio vigore’ he must be held to be a landlord to seek eviction of the respondent under Section 21(l)(h) of the Act.
Per contra, submission of the learned Counsel for respondent was that the definition was not absolute and the definition of landlord, as contained in Section 3(h) applies if the context permits or not repugnant and not otherwise . If the context does not permit extension of such definition, whatever may be his rights under the Transfer of Property Act, he will not be a landlord to seek eviction, be it bona fide or otherwise.
It was also contended, if mortgagee in possession could be a landlord, necessarily a tenant under him must get all protection provided under the Act.
Relying on the decision of the Supreme Court and of this Court, starting from ASA RAM AND ANR. v. MIST. RAM KALI AND ANR. , ALL INDIA FILM CORPORATION LTD. AND ORS. v. SHRI RAJA GYAN NATH AND ORS. : SACHIMAL PARASRAM v. RATANBAI AND ORS. (1972 SC 637) and SALANKI HANMANTH RAO v. H. GURUSHANTHAMMA AND ORS. [1973(2) Mys.L.J. 147], it was contended that the right of a usufructuary mortgagee was only transitional and would cease as soon as the mortgage is redeemed, and having regard to that legal position submitted the remedial measures intended to be achieved by the Legislature by enacting the Rent Control Act would be defeated and tenant would be deprived of his protective umbrella. It was also contended that such a recourse would put rights of tenant in peril opening flood gates or device for eviction.
On a careful consideration, we fully endorse the views of the learned Single Judge that it is a matter of general importance and of a substantial nature which requires adjudication by a larger Bench.”
5. In this view of the matter, having formulated the two points for consideration stated above, referred the said questions for the decision of the Full Bench under Section 7 of the ‘Karnataka High Court Act, by Order dated 7-7-1988.
6. At the hearing, before us, the learned Counsel for the petitioner submitted that the Supreme Court in the case of ABDUL AZEEZ v. MANIYAPPA SETTY ILR 1989 KAR 314 (DD 14-10-1988) considered the question:
Does a mortgagee with possession stand on par with an owner of a building to seek eviction of a tenant under Section 21(l)(h) of the Act, for his bona fide requirement of the tenanted premises for residential or business needs?
The Supreme Court answered this question in the affirmative having referred to decisions in V. BALUSWAMY SERVAI v. N. RAJU SERVAI; 1966(2) MLJ 4 T. EZHUMALAL v. PADMAVATHI AMMAL; 1971(2) MLJ 121ASWATHARAMIAH v. SPECIAL DEPUTY COMMISSIONER; 1977(1) KLJ 332 S. SUBRAMANYASWAMY v. DEPUTY COMMISSIONER, BANGALORE and R. VIJENDRA v. H.R. & A.C.
In the first two decisions, the learned Single Judges of the Madras High Court held that the usufructuary mortgagee of a building in the occupation of a tenant would undoubtedly be a landlord within the meaning of Section 2(6) of the Madras Buildings (Lease & Rent Control) Act, 1960 and therefore would be entitled to evict a tenant under Section 10(3)(a)(i) of the Act on the ground of bonafide requirement of the premises for his personal occupation. The same view was taken by the learned Single Judge of this Court in the case of Aswatharamiah aforesaid. However, in the case of Subramanyaswamy, the Division Bench took a different view. Faced with the situation, a reference was made to a Full Bench of this Court on this question, The Full Bench of this Court in the case of R. Vijendra held that usufructuary mortgagee is a landlord for the purpose of Part II of the Karnataka Rent Control Act, 1961.
7. The Supreme Court in the decision of Abdul Azeez referred to supra held that the view taken by the Single Judges in the cases referred to above and the Full Bench in R. Vijendra’s case, is the correct view.
8. The argument that a scheming landlord may adopt a dubious method of creating a sham deed of usufructuary mortgage in order to have a tenant evicted, when he himself cannot sustain such an action was not accepted by the Supreme Court on the ground that an order of eviction under Section 21(1)(h) of the Act, would not be passed by the Court for the mere asking inasmuch as the mortgagee with possession has to essentially prove that the premises are reasonably and bona fide required by him for occupation by himself. Unless the reasonable and bona fide requirement is proved to the satisfaction of the Court, no order of eviction will be passed. Further, the mortgagee with possession has to further satisfy the test laid down by Sub-section (4) of Section 21 of the Act, which provides that a tenant shall not be evicted under Section 21 (1 )(h) of the Act, if the Court is satisfied that the tenant would be put to greater hardship by an order of eviction being passed than the hardship that would be caused to the landlord by refusal to pass an order of eviction in his favour.
9. Section 3(h) read with Explanation to Section 21(4) of the Act, does not leave any doubt whatsoever that an usufructuary mortgagee comes within the fold of landlord for maintaining a petition for eviction. A mortgagee with possession steps into the shoes of the mortgagor and becomes entitled to all the rights of the mortgagor and the only right left to the mortgagor is the right of redemption. Hence, a mortgagee with possession is entitled to be in possession of the mortgaged property as long as it is not redeemed.
I 10. The rights and protection given to tenants under the Act do not get affected in any way merely because an usufructuary mortgage is executed and such a mortgagee becomes landlord as defined under Section 3(h) of the Act. As such, a statutory tenant under the original landlord obviously becomes a statutory tenant under the mortgagee also.
11. In the light of what is stated above and following the Judgment of the Supreme Court in the case of Abdul Azeez (supra), we answer both the questions, referred to us, in the affirmative.