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1984 Supreme(Kar) 92

Karnataka High Court
Pascal Lazarous Lobo - Appellant
Versus
K.Sundara Shetty - Respondent
Decided On : 05-31-84
C.R.P. : 1279 of 1982

Advocates:
B.P.HOLLA, P.GANAPATHY BHAT

The main legal point established in the judgment is that the requirement of a Private Limited Company cannot be considered as the requirement of its members, based on the legal entity of the Company and the rights of its members.

Headnote:

Eviction - Requirement of Company - Karnataka Rent control Act, 1961, Section 21(1) - A Private Limited Company's requirement cannot be considered as the requirement of its members - Supreme Court rulings on the distinction between the requirement of a landlord and that of a partnership firm - Court's decision based on the legal entity of the Company and the rights of its members

Fact of the Case:

The landlord sought eviction of the tenant for the construction of a Boarding and Lodging House by a Private Limited Company of which he was the Managing Director. The tenant resisted, arguing that the requirement of the Company was not the requirement of the landlord and was not bona fide and reasonable.

Finding of the Court:

The Court found that the requirement of the Company could not be considered as the requirement of the landlord, based on the legal entity of the Company and the rights of its members.

Issues: The main issue was whether the requirement of the Private Limited Company could be considered as the requirement of the landlord.

Ratio Decidendi: The Court's decision was based on the distinction between the requirement of a landlord and that of a partnership firm, as well as the legal entity of the Private Limited Company and the rights of its members.

Final Decision: The Court allowed the revision petition and dismissed the petition of the landlord for eviction of the tenant, setting aside the orders of the Courts below.

SABHAHIT, J.

( 1 ) THIS revision petition by the tenant under Section 115 of the Code of Civil procedure is directed against the order dated 1-2-1982 made by the District Judge. D. K. , Mangalore, in Civil Revision Petition No. 133 of 1980, on his file, dismissing the revision petition of the tenant, on confirming the order dated 15-9-1980 made by the First Additional Munsiff, mangalore, in HRC No. 62 of 1976, on bis file, allowing the petition of the landlord under Clause (j) of the proviso to section 21 (1) of the Karnataka Rent control Act, 1961, (hereinafter referred to as the Act' ).

( 2 ) THE landlord sought for eviction of the tenant from the petition schedule premises under Clauses (j) and (1) of the proviso to Section 21 (1) of the Act, though during hearing he gave up the claim under Clause (1) of the proviso to Section 21 (I) of the Act. The landlord avei- red that himself and his wife purchased the petition schedule premises, among others, by a registered sale deed dated 19-7-1973 (Exhibit P-9) with the idea of putting up a Boarding and Lodging House therein. Since, however, the project invoived consdierable expenditure, they found a Private Limited Company along with others styled as 'hotel Sukanya Private limited'. The Company was promoted by the present landlord and his wife. The memorandum of Articles of Association is at Exhibit P-1. The landlord is the managing Director of the Company for life. He has sought for eviction of the tenant for the construction of a Boarding and Lodging House by the Company of which he is the Managing Director, bona fide and reasonably.

( 3 ) THE tenant resisted the claim. Inter alia, he contended the requirement of the Company was not the requirement of the landlord and. as such, the present landlord could not institute a petition for eviction of the tenant either under Clause (j) or Clause (I) of the proviso to Section 21 (1) of the Act. He also contended that the requirement of the landlord was not bona fide and reasonable.

( 4 ) THE Courts below, however, found concurrently that since the present landlord was the Managing Director of Hotel sukanya Private Limited, for whose benefit the petition schedule premises were required, the requirement was that of the landlord and, in that view, they proceeded to award eviction in favour of the landlord under Clause (j) of the proviso to Section 21 (1) of the Act. Aggrieved by the said orders, the tenant has come up with the above revision petition before this Court.

( 5 ) THE learned Counsel appearing for the revision-petitioner strenuously urged before me that the case made out by the landlord was clear that the premises were required for construction of a Boarding and Lodging House by the Private Limited company and, as such, the requirement of the Company could not be described as the requirement of the landlord.

( 6 ) AS against that, the learned Counsel appearing for the respondent / landlord argued supporting the reasoning of the Courts below and submitted that since the present landlord was the Managing Director of the Company for life, no distinction could be made in reality from the requirement of the Company and that of the landlord. This was argued at length as a preliminary point.

( 7 ) SO, the sole question that arises for my consideration in this revision petition is ' Whether the Courts below were justified in holding that the requirement by the Company, namely, Hotel Sukanya private Limited, could be described as the requirement of the landlord ? '

( 8 ) IT is not in dispute that the property was purchased under Exhibit P-9 by K. Sundara Shetty, the present landlord, and his wife. They started a Private limited Company under the name and style ' Hotel Sukanya Private Limited ' with a view to put up a Boarding and lodging House on the premises. It is further in evidence, as seen from the articles of Association and the Memorandum, that the present landlord is made the managing Director of the Company for life and, thus, he

















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