IMPORTANT POINTS
1. Section 14(1)(b) of Tamil Nadu Rent Control Act did not contemplate that building sought to be demolished and to be reconstructed must necessarily be in a dilapidated condition.
2. In an eviction petition on ground of bonafide requirement of the premises for reconstruction, the court must take into account the bonafide intention of the landlord, the age and condition of the building, and the financial position of the landlord to demolish and erect a new building. These are some of the illustrative factors which have to be taken into account and, they are by no means conclusive.

Headnote:Tamil Nadu Buildings (Lease and Rent Control) Act, 1960—Section 14(1)(a)—Eviction petition on ground of personal bona fide need—Petition allowed by Rent Controller and Tribunal on concurrent finding that petitioner was carrying jewellery business in a rented accommodation and needed suit premises shop situated in midest of commercial city—High Court set aside eviction order laying emphasis on single sentence in entire deposition of landlord that he could not do business if he got possession of existing shop—Recording of evidence was not accurate—Admission was clearly against general tenor of landlord’s deposition—High Court was in error in rejecting claim of bona fide personal need merely on basis of so called admission.
       Held : In very categorical terms, he stated that he required the premises for the purpose of carrying on his own occupation from where he wanted to conduct his gold jewellery shop. He again reiterated the same by saying that he required the premises for his own occupation. Only thereafter the so-called admission appears on which great emphasis had been laid by the High Court. In fact, later in the same paragraph, he has stated that most important reason for claiming eviction was his need of the premises for his own occupation. Reading the deposition as a whole, it would appear that the landlord, in categorical terms, has repeatedly asserted that he needed the premises in question for running his own business in jewellery. He has emphasised the fact that the premises is located in a commercial locality and he, more than once, stated that he needed the premises for his own occupation. We are, therefore, inclined to take the view that the recording of evidence of PW 1 was not accurate, wherein it has been recorded that he could not do business if he got possession of the existing shops. Perhaps what he must have stated is that he cannot do business “unless” he got possession of the existing shops. The admission clearly goes against the general tenor of the landlord’s deposition, which strengthens our apprehension that the same is the result of faulty recording of evidence. We, therefore, have no doubt that the High Court was in error in rejecting the claim of bona fide personal need of the landlord merely on the basis of the so-called admission made by the landlord in his deposition, which appears to be a result of faulty recording of his evidence.(Para 6)
       (ii) Tamil Nadu Buildings (Lease and Rent Control) Act, 1960—Section 14(1)(b)—Eviction petition in respect of suit shop for demolition and reconstruction of building—Rent Controller and Tribunal allowed petition—High Court set aside the order on a reasoning that landlord had not satisfactorily established that he had means to reconstruct the building—Locality in which premises in question was located had developed into a commercial locality—Landlord had got plans approved for construction of a new building—Section 14(1)(b) of the Act did not contemplate that building sought to be demolished must necessarily be in a dilapidated condition—Raising funds for construction in a commercial centre was not a difficulty when builders, financiers and banks were willing to advance funds—Landlord in given circumstances made out a case for demolition and erection of new building.
       Held : We do not attach much importance to the question as to whether the building was or was not in a dilapidated condition because Section 14(1)(b) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 (for short ‘the Act’) contemplates a building which is bona fide required by the landlord for the immediate purpose of demolishing it, and such demolition is to be made for the purpose of erecting a new building on the site of the building sought to be demolished. Therefore, Section 14(1)(b) does not contemplate that the building sought to be demolished must necessarily be in a dilapidated condition. Even if a building is not in a dilapidated condition, it may be demolished for the purpose of erecting a new building on the same site.(Para 7)
       It is true that in granting permission under Section 14(1)(b) of the Act, all relevant materials for recording a finding about the requirement of the landlord for demolishing the building and reconstruction of a new building, have to be taken into account. The Rent Controller reached the conclusion that the landlord bona fide requires the premises for demolition and reconstruction of a new building. This Court has observed in Vijay Singh and Others vs. Vijayalakhmi Ammal, (1996) 6 SCC 475, that the Court must take into account the bona fide intention of the landlord, the age and condition of the building, and the financial position of the landlord to demolish and erect a new building. These are some of the illustrative factors which have to be taken into account and, they are by no means conclusive. In the instant case, we find that the property owned by the landlord, whatever may have been its value in the past, has acquired commercial value and, therefore, the landlord wishes to demolish the old single storey structure and to construct a multi-storyed building which may fetch him higher rent, apart from serving his own needs. The landlord had already applied to the competent authorities and got the plans approved. Taking into consideration all these reasons, we are convinced that the landlord bona fide intends to demolish the old building and to construct a new one. Raising funds for erecting a structure in a commercial centre is not at all difficult when a large number of builders, financiers as well as banks are willing to advance funds to erect new structures in commercial areas. This is apart from the fact that the landlord has himself indicated that he was willing to invest a sum of Rs. One and a half lakh of his own, and he owns properties and jewellery worth a few lakhs. In these circumstances, we are satisfied that the landlord established his case that he required the premises for its demolition and erection of a new building on the same site.(Paras 10 to 12)

JUDGMENT

B.P. Singh, J.—The appellant before us is the landlord who filed two suits for eviction of two tenants from the premises owned by him in the city of Coimbatore, State of Tamil Nadu. His case was that he was conducting business in jewellery from a rented premises belonging to the municipality. The premises in question was located in the business centre of the city of Coimbatore surrounded on all sides by multi-storeyed buildings. He wanted to shift his business from the rented premises to his own premises. He also pleaded that the tenants were in default in payment of rent and, therefore, they were liable to be evicted on that ground alone. He further contended that he also wanted to demolish the premises in question and reconstruct it having regard to its utility, it being located in the business centre of the city of Coimbatore.

2. The Rent Controller as well as the appellate tribunal concurrently held that the appellant-landlord had been able to prove all the three grounds on which the eviction was claimed, namely, (i) the default in payment of rent; (ii) bona fide personal need for doing jewellery business; and (iii) for demolition and reconstruction of the building. The matter ultimately came up before the High Court of Judicature at Madras in C.R.P. Nos. 2196 of 1992 and 2197 of 1992.

3. The High Court, by its impugned judgment and order of 21st October, 1997, set aside the concurrent findings recorded by the appellate tribunal and the Rent Controller and dismissed the suits for eviction. On the question of default in payment of rent, the High Court held that the rent of the premises was Rs. 25/- per month only and that after filing of the suits, the rent for the period from 15th July, 1982 to 15th March, 1983 was deposited in court by the tenants on the first date of hearing, namely, 27th April, 1983. The learned counsel for the appellant-landlord submitted before us that the rent was not deposited on the first date of hearing, but we do not wish to consider this question because we find that the other two grounds for eviction have been made out by the appellant-landlord.

4. The appellant-landlord claimed that he was conducting jewellery business from rented premises and he had no other non-residential premises in the city of Coimbatore. He, therefore, needed the premises in question for carrying on his own jewellery business. The respondents-tenants contended that his (the appellant’s) need was not bona fide. The High Court found that the landlord was conducting jewellery business from rented premises. It was also held that the landlord did not have any other non-residential premises of his own from where he could conduct his jewellery business. However, the High Court laid great emphasis on one sentence appearing in the deposition of the landlord, who was examined as PW 1, which reads as follows :—

“I cannot do business if I got possession of the existing shops.”

5. Solely on the basis of this so-called admission, the High Court held that the requirement of the landlord was not bona fide.

6. We have read the deposition of PW 1. We notice that the recording of evidence is rather unsatisfactory, and most of the sentences are not even complete. The evidence has been recorded in a rather abbreviated manner. However, the landlord has clearly stated that he needed one shop for carrying on his own jewellery business and the premises in question were located in a commercial area in the city of Coimbatore. In very categorical terms, he stated that he required the premises for the purpose of carrying on his own occupation from where he wanted to conduct his gold jewellery shop. He again reiterated the same by saying that he required the premises for his own occupation. Only thereafter the so-called admission appears on which great emphasis had been laid by the High Court. In fact, later in the same paragraph, he has stated that most important reason for claiming eviction was his need of the premises for his own occupation. Re

Click Here to Read the rest of this document

2006 Supreme(SC) 283

Cases Referred (1)