The Court's interpretation of Section 13(1)(i) of the Rent Act and its holding that the section was constitutionally valid and did not violate Article 14 of the Constitution of India.

Headnote:
Bombay Rents, Hotel and Lodging House Rates Control Act 1947 - Section 13(1)(i) - Constitutional validity - Classification of tenants - Reasonableness and bona fide requirement of landlord - Interpretation - Sub-tenants - Rights and liabilities - Section 14 - Effect.
Fact of the Case:

The petitioners, who are sub-tenants of the suit property, challenged the decree passed by the Appellate Bench of the Court of Small Causes on various grounds. The main contention of the petitioners was that Section 13(1)(i) of the Bombay Rents, Hotel and Lodging House Rates Control Act 1947 (the Rent Act) was unconstitutional as it violated Article 14 of the Constitution of India. The petitioners also contended that the suit was barred by res judicata, that Section 13(1)(i) of the Rent Act did not apply to open land, and that the effect of Section 14 of the Rent Act was to confer direct tenancy rights on the sub-tenants in the event of the termination of the tenancy of the principal tenant.
Finding of the Court:

The Court held that Section 13(1)(i) of the Rent Act was constitutionally valid and did not violate Article 14 of the Constitution. The Court also held that the suit was not barred by res judicata, that Section 13(1)(i) of the Rent Act applied to open land, and that the effect of Section 14 of the Rent Act was not to confer direct tenancy rights on the sub-tenants in the event of the termination of the tenancy of the principal tenant.
Issues: 1. Whether Section 13(1)(i) of the Rent Act was unconstitutional as it violated Article 14 of the Constitution of India? 2. Whether the suit was barred by res judicata? 3. Whether Section 13(1)(i) of the Rent Act applied to open land? 4. Whether the effect of Section 14 of the Rent Act was to confer direct tenancy rights on the sub-tenants in the event of the termination of the tenancy of the principal tenant?
Ratio Decidendi: 1. The Court held that Section 13(1)(i) of the Rent Act was constitutionally valid and did not violate Article 14 of the Constitution. The Court found that the classification of tenants under Section 13(1)(i) was reasonable and had a rational basis. The Court also found that the restrictions imposed on the landlord's right to evict tenants under Section 13(1)(i) were necessary to protect the interests of tenants and to prevent unreasonable evictions. 2. The Court held that the suit was not barred by res judicata. The Court found that the earlier suit between the parties had been dismissed on a technical ground and that the findings of fact recorded in that suit were not binding on the parties in the present suit. 3. The Court held that Section 13(1)(i) of the Rent Act applied to open land. The Court found that the definition of 'premises' in Section 5(8) of the Rent Act included land and that there was no reason to exclude open land from the scope of Section 13(1)(i). 4. The Court held that the effect of Section 14 of the Rent Act was not to confer direct tenancy rights on the sub-tenants in the event of the termination of the tenancy of the principal tenant. The Court found that Section 14 only applied to sub-tenants who were in lawful occupation of the premises at the time of the termination of the tenancy of the principal tenant and that such sub-tenants became statutory tenants of the landlord.
Final Decision: The Court dismissed the petitions and upheld the decree passed by the Appellate Bench of the Court of Small Causes.

Judgment

1. These four petitions are filed by the 15 petitioners the alleged sub - tenants of Defendant No. 1 who are aggrieved by the order of ejectment passed against them by the Appellate Bench of the Court of Small Causes. As common questions of fact and law are involved in these petitions, I propose to dispose them of by one common judgment. The proceedings arise out of the ejectment suit filed by the respondents against Defendant No. 1 and the petitioners.

2. A few facts leading to this litigation are as follows : The suit property comprises of an open plot of land measuring about 1050 square years situate at Mahul Road, Chembur, Greater Bombay. The respondents are the owners of this plot. In February 1954 Respondent No. 1 let out the said open plot of land to Defendant No. 1 Shaikh Hassan Shaikh Razack for his char - coal business. The agreed rent per month was Rs. 100/- and it is said that the lease was for a period of three years. No written document evidencing the lease is placed on the record of these proceedings. But it is admitted that the said lease was in the first instance for a period of 3 years. The rent of Rs. 100/- per month was subsequently reduced to Rs. 80/- per month as a result of proceedings between the parties. It appears that Shaikh Razack put up shop structures on the open plot of land in or about the month of August 1954 and let out the said structures to various sub - tenants. On 25-2-1957 Respondent No. 1 gave a notice to quit to Razack and on the basis of that notice Respondent No. 1 filed a suit on 11-4-1957 seeking the eviction of Razack and some other defendants (those defendants are some of the defendants in these proceedings also) on various grounds. Possession was sought on the ground on non - payment of rent, breach of the terms of tenancy, erection of permanent structures, unlawful sub - letting, illegal profiteering and also on the ground that the plot of land was required reasonably and bona fide for construction of a building. The suit was initially filed only against Defendant No. 1 and the defendants who were alleged to be sub - tenants, were later on impleaded at their own instance. That suit was decreed on 21-7-1960. Defendant No. 1 Razack preferred an appeal and the other defendants also challenged that decree in appeal Court. In all three appeals were filed against the decree in ejectment passed by the trial Court. On 31-8-1961 the Appellate Bench of the Court of Small Causes allowed the appeals and directed the dismissal of the suit. The appellate Bench held that the defendants were in fact sub - tenants of the land. Only one defendants was held to be a sub - tenant of the land. The Court also found that the plaintiff had not established any breach of the terms of the tenancy. The Court further held that the plaintiff had filed to prove profiteering by the tenant; that the structure put up by the tenant was not a permanent structure within the meaning of the relevant provisions of Section 13 of the Rent Act and that the plaintiff had failed to prove the premises were required by him reasonably and bona fide for his own occupation after erecting the new building. The Appellate Bench also came to the conclusion that the suit filed on the basis of the quit notice dated 25-2-1957 was premature and the suit was liable to be dismissed. It was held that the lessor had not given one clear months notice before the institution of the suit.

3. On 21-9-1961 the Respondents gave another notice terminating the tenancy of defendant No. 1 Razack. As the respondents felt that the notice was defective they, by way of abundant caution, gave another notice on 21-11-1961 terminating the tenancy of defendant No. 1 Razack. On 17-2-1962 they filed a suit against Razack claiming possession of the suit premises on various grounds. They alleged that Razack had erected permanent structures without their consent in writing; that he had illegally sub - let portions of the plot to others; that he was profiteer

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Judicial Analysis

1970 Supreme(Bom) 131

The Court's interpretation of Section 13(1)(i) of the Rent Act and its holding that the section was constitutionally valid and did not violate Article 14 of the Constitution of India.

Cases Referred (1)

Judicial Analysis