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1992 Supreme(Kar) 124

Karnataka High Court
Ramakrishna Theatres Ltd. - Appellant
Versus
General Investments and Commercial Corporation Ltd. - Respondent
Decided On : 03-27-92
W.P. : 23759 of 1990

Advocates:
A.G.HOLLA, K.A.Ariga, N.K.Gupta, Radesh Prabhu, TUKURAM S.PAL

The main legal point established in the judgment is that the landlord's right to recover possession cannot be enforced during the term lease period unless the lease deed provides for the determination of the lease.

Headnote:

eviction - leasehold premises - Karnataka Rent Control Act, 1961, Section 21 (1) - [21 (1)] - The court discussed the interpretation of Section 21 (1) of the Karnataka Rent Control Act, 1961, and its application to the eviction of a tenant holding a leasehold premises under a term lease. The court overruled the previous decision in Bharath Petroleum Corporation's case, holding that the landlord's right to recover possession cannot be enforced during the term lease period unless the lease deed provides for the determination of the lease. The court directed the lower court to decide the proceedings in light of this judgment.

Fact of the Case:

The petitioner obtained a land on term lease from the first respondent, with a lease period till 31-3-1998. The first respondent issued a quit notice and filed an eviction petition invoking Section 21 (1) (h) of the Karnataka Rent Control Act, 1961, intending to use the premises for cinema shows. The petitioner questioned the right of the landlord to seek possession before the expiry of the lease period. The sole question was whether a landlord is entitled to seek eviction of a tenant holding the leasehold premises under a term lease before the expiry of the lease period when there is no provision for the forfeiture of lease in the lease-deed.

Finding of the Court:

The court found that the landlord's right to recover possession cannot be enforced during the term lease period unless the lease deed provides for the determination of the lease. The court overruled the previous decision in Bharath Petroleum Corporation's case and directed the lower court to decide the proceedings in light of this judgment.

Issues: The main issue was whether a landlord is entitled to seek eviction of a tenant holding the leasehold premises under a term lease before the expiry of the lease period when there is no provision for the forfeiture of lease in the lease-deed.

Ratio Decidendi: The court held that the landlord's right to recover possession cannot be enforced during the term lease period unless the lease deed provides for the determination of the lease. The court overruled the previous decision in Bharath Petroleum Corporation's case, emphasizing that the recovery of possession can only be made by recourse to Section 21 (1) of the Karnataka Rent Control Act, 1961.

Final Decision: The court directed the lower court to take up the proceedings and decide the same in the light of this judgment.

SHIVASHANKAR BHAT, J.

( 1 ) THIS writ petition was referred by the learned single Judge for consideration by the Division Bench on the ground that it involves a substantial question of law. The Division Bench in turn referred the matter for consideration by a larger Bench on the ground that an earlier decision of a Division Bench of this Court in Bharath Petroleum Corporation Ltd. v. Mohammed Haneef, AIR 1986 Kant 191, hereinafter referred as Bharath Petroleum Corporation's case, may require reconsideration.

( 2 ) THE petitioner obtained a land measuring 111/2 cents in Udupi town on term lease from the first respondent, along with a building thereon and other appurtenant land and buildings. It was a term lease and the lease deed was registered. The lease deed was executed on 3-9-1973. The lease was for a period of 25 years with effect from 1-4-1973. The lease deed indicates that the lessee was already in possession by virtue of an earlier lease deed dated 28-7-1950 and the land had a theatre building thereon and that the lessee (petitioner) had re-modelled the said old building. The lease deed of the year 1973 inter alia provided that on the expiration of the lease period, the theatre building also shall vast in the lessor (first respondent) absolutely without payment of any compensation and till then the lessee may hold and enjoy the demised premises without any lawful interruption by the lessor. The monthly rent was Rs. 650/- and the lessee had to pay all taxes in excess of the prevailing rate of tax at the time of the execution of the lease deed and the lessee was liable to pay interest on arrears of rent at the rate of 121/2 per cent per annum. There was no clause anywhere providing for forfeiture of the lease. Thus the lease was to be in operation till 31-3-1998.

( 3 ) IN the year 1989 the first respondent-landlord issued a quit notice and thereafter filed an eviction petition invoking S. 21 (1) (h) of the Karnataka Rent Control Act, 1961 ('the Act' for short ). The first respondent herein stated that it intended to use the premises for exhibition of cinema shows, etc. and that its requirement was reasonable and bona fide and that it was entitled to seek possession of the leasehold under the provisions of the Act. The petitioner-lessee filed a counter statement, inter alia, questioning the right of the landlord to seek possession before the expiry of the lease period. These proceedings were initiated as per H. R,c. No. 19/1989 in the Court of Additional Munsiff, Udupi. The petitioner also filed an application requesting the Munsiff Court to decide the question of maintainability of the eviction petition as a preliminary point. Though this application was filed on 6-9-1989, so far it has not been taken up.

( 4 ) THE sole question that arises under this preliminary point is whether a landlord is entitled to seek eviction of a tenant who is holding the leasehold premises as a lessee under a term lease, before the expiry, of the period of lease when there is no provision for the forfeiture of lease in the lease-deed. The first respondent herein has relied on a decision of this Court rendered by a Division Bench in the aforesaid Bharath Petroleum Corporation's case. It was held in the said decision that non-obstante clause in Section 21 (1) of the Act has overriding effect and even if there is a contract of lease for a stipulated term, the Act gives to the landlord a right to initiate action for eviction if the conditions stated in Section 21 are fulfilled and it was further held therein that the contractual rights are replaced by the rights created by the Act. Since the landlord would be seeking to enforce his right under the Act any term to the contrary in the contract between the parties cannot be set up as a defence by the tenant. In view of this decision, there can be no doubt that the Munsiff Court was bound to entertain the eviction petition and to decide the preliminary question against the petitioner-tenant. In these






















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