Nazar vs Palm Fibre (India) P. Ltd.

N.K. Balakrishnan, J.

1.The tenant is in revision. Order of eviction was concurrently passed u/s 11(3) of the Act. Though claim for eviction was made u/s 11(2)(b), that

was disallowed by the Rent Controller. It was not appealed against. The petition schedule building was originally held by a firm by name Green

Garden Company. It was contended by the landlord that the Respondent company took over the assets of the partnership firm and since then it

became the landlord of the entire property including the petition schedule building. The need projected is that the company wanted to construct a

nine storied building and that unless the petition schedule building is demolished the proposed building cannot be constructed making use of the

remaining area.

The claim was resisted by the revision Petitioner contending that the Respondent is not the landlord of the petition schedule building and that the

revision Petitioner is not a tenant under the Respondent. It was also contended that for the construction of the nine storied building as alleged by

the Respondent, the petition schedule building is not liable to be demolished. The Rent Controller found that the denial of title put forward by the

revision Petitioner is not bona fide. It was found that the need put forward by the Respondent to construct a nine storied building as stated in the

petition is true and that without demolishing the petition schedule building the said construction cannot be made. Though the revision Petitioner

contended that he is entitled to the benefit of the second proviso, he could not succeed in his plea. Hence order of eviction was passed u/s 11(3).

The learned Appellate Authority on a reappraisal of the evidence concurred with the order passed by the Rent Control Court.

Sri.T Jayakrishnan, learned Counsel appearing for the revision Petitioner made strenuous arguments on all the grounds raised in the Revision

Petition. He would mainly attack the order passed by the Rent Controller on the ground that though the plea of denial of title was raised by the

revision Petitioner in the counter statement, it was not considered by the Rent Controller as a preliminary point. The learned Counsel would submit

that the Second Proviso to Section 11(1) mandates that where the tenant denies the title of the landlord, the Rent Control Court shall decide

whether the denial or claim is bona fide and if it records a finding to that effect, the landlord shall be entitled to sue for eviction of the tenant in a

civil court. It is further argued by the learned Counsel that since the Rent Control Court did not raise the preliminary point to decide the question as

to whether the denial of title is bona fide or not, the revision Petitioner filed I.A. No. 1796 of 2008 requesting the court to decide that question.

The order passed on that application on 29.5.2008 is as follows:

Heard. Petition is allowed. Heard the question whether the denial of title is bona fide or not. Hence the I.A. Is closed.

(It does not convey the intended meaning)

According to the learned Counsel no order was passed by the Rent Control Court as to whether the denial of title is bona fide or not. On the

other hand the learned Counsel for the Respondent/landlord would submit that there is another order dated 2.6 2008. On verification of the

records a draft order dated 2.6.2008 could be seen. A detailed order is seen typed and signed by the Additional Munsiff (it should have been

signed as the Additional Rent Controller). The learned Counsel for the revision Petitioner would submit that when I.A. No. 1796 of 2008 was

closed on 29.5.2008 as has been quoted earlier, it is inconceivable how a separate order could be passed on 2.6.2008 behind the back of the

revision Petitioner. The learned Counsel has also pointed out when application for certified copy of the order was filed he was supplied with the

order as quoted earlier. The learned Counsel submits that had the revision Petitioner been supplied with a copy of the order dated 2.6.2008, he

could have challenged that order before the Appellate Authority. It is seen that the learned Rent Controller has not followed the procedure

correctly. The order passed on 2.6.2008 should have found a place on the petition I.A No. 1796 of 2008. No indication is seen on the aforesaid

application with regard to the order passed on 2.6.2008.

Be that as it may, the procedural irregularity or illegality pointed out above cannot come to the rescue of the revision Petitioner, the learned

Counsel for the Respondent submits.I.A. No. 1796 of 2008 was filed only a few days prior to the date listed for trial of the R.C.P. It is also

pointed out that in the counter statement there was no specific denial of the title of the Respondent. It was only stated that the revision Petitioner

was not aware as to who is the landlord. It was further stated that the Petitioner in the R.C.P should be put to strict proof regarding its title.

It is submitted by the learned Counsel for the landlord that the petition schedule building and the entire landed property originally belonged to

M/s. Green Garden Company which was a partnership firm. That firm was stated have been dissolved. Partners of that firm thereafter formed the

Respondent Company taking over the entire assets and liabilities of the firm. It was also stated that partners of the dissolved firm were actually the

share holders of the Respondent company. The learned Counsel for the landlord refers to the provision contained in Section 47(xiii) of the Income

Tax Act which reads:

(xiii) any transfer of a capital asset or intangible asset by a firm to a company as a result of succession of the firm by a company in the business

carried on by the firm, or any transfer of a capital asset to a company in the course of demutualisation or corporatisation of a recognised stock

exchange in India as a result of which an association of persons or body of individuals is succeeded by such company:

Provided that-

(a) all the assets and liabilities of the firm or of the association of persons or body of individuals relating to the business immediately before the

succession become the assets and liabilities of the company;

(b) all the partners of the firm immediately before the succession become the shareholders of the company in the same proportion in which their

capital accounts stood in the books of the firm on the date of the succession;

Sri.T. Jayakrishnan would submit that the aforesaid provision is only concerning the assessment of income tax and it cannot have overriding

effect on the provisions contained in the Transfer of Property Act and the Registration Act. According to the learned Counsel unless registered

assignment deed is executed in favour of the company there cannot be any transfer of the immovable property in favour of the company. It was

also argued by Sri Jayakrishnan that the revenue records will even now show that the firm is the title holder of the property including the plaint

schedule building and no mutation was also effected. Hence, according to the learned Counsel the Respondent company has not become the

owner of the petition schedule building.

This argument is stiffly resisted by the leaned counsel Sri. Mathew John, who would submit that it is not the proprietary title that has to be gone

into or decided. What is germane for consideration is whether there is landlord-tenant relationship between Respondent and the Petitioner. In this

connection it is pointed out that it was specifically stated in the petition that after the company was constituted there was a fresh atonement by the

tenant whereby he became liable to pay the rent and in fact the revision Petitioner had paid the monthly rent to the Respondent company for a few

months. These aspects were not denied at all by the revision Petitioner. Therefore, it can be held that the revision Petitioner has admitted the

Respondent as the landlord which expression includes the person who is receiving or is entitled to receive the rent of the building. Therefore, not

only that there was no specific denial of title as envisaged under the Second Proviso to S. 11(1) but there is also evidence to prove that the

Respondent is the landlord entitled to maintain an action for eviction against the revision Petitioner. These aspects were considered by the learned

Appellate Authority also. Even though there was irregularity in the procedure adopted by the learned Rent Controller in passing the order on I.A.

No. 1796 of 2008, we are not inclined to accept the submission made by Sri. Jayakrishnan that the matter should be remanded to the Rent

Control Court for a fresh consideration of the denial of title put forward by the tenant.

The next argument advanced by Sri. Jayakrishnan, the learned Counsel for the Petitioner is that the Respondent is a company and not a natural

person and since the words employed in Section 11(3) are ""he"" and ""his"", the need should be of a natural person and the building sought to be

evicted should be for ""his own"" occupation and not for the occupation of a company. The learned Counsel would rely upon the decision in

Palakkad District Co-op. Bank v. Mohammed Kaleem (1996 (1) KLT 247)That was a case where the words ""his livelihood"" occurring in the

Second Proviso to S. 11(3) of the Act was interpreted. In the context of the words used in the Second proviso it was held:

The wording of the proviso would clearly indicate that only if a tenant proves that he is depending for his livelihood mainly on the income derived

from any trade or business carried on in the building occupied by him as a tenant, the tenant can take advantage of the protection granted under the

second proviso to Section 11(3) of the Act. The words ''his livelihood'' can naturally have only reference to a natural person and not to an

inanimate lifeless legal entity like a Co-operative Society or a Company incorporated under the Companies Act. The word ""his"" would place the

matter beyond any doubt. It can only be a pronoun for a natural person. If legal persons or entities like Companies or Societies registered under

the Societies Registration Act and statutory bodies were also comprehended as beneficiaries of the second proviso, the legislation would have

certainly used the words ''his or its livelihood'' even accepting that there can be livelihood for legal persons or entities.

The intention behind in introducing the Second Proviso to S. 11(3) (sic) is to give a protective umbrella to the tenant from being evicted u/s

11(3), if he is depending for his livelihood mainly on the income derived from the trade or business carried on in such building; provided he also

proves that there is no other suitable vacant building available in the locality to shift his trade or business. Therefore the word ""his"" has got much

significance in the context in which it is employed in the Second Proviso to S. 11(3). But that interpretation cannot be imported when the claim u/s

11(3) arises for consideration.

It was held in the decision in Gramophone Company of India Ltd. Vs. Birendra Bahadur Pandey and Others, :

The same word may mean different things in different enactments and in different contexts. It may even mean different things in different places in

the same statue. It all depends on the sense of the provision where it occurs. Reference to dictionaries is hardly of any avail, particularly in the case

of words of ordinary parlance with a variety of well known meanings. Such words take colour from the context.

The meaning of a word or expression used in a statute is often coloured by the context in which it occurs. It is the duty of the court to determine in

what particular meaning and particular shade of meaning the word or expression was used by the law makers.

""Person"" shall include any company or association or body of individuals, whether incorporated or not. By incorporation under the Companies

Act, Company is vested with a corporate personality which is distinct from the members who compose it. A Company, being a body corporate,

can sue and be sued in its own name unlike a partnership him. A company can own property. If a company can own properly certainly Company

can also be a ''landlord'' as defined under the Act. If the company is a landlord certainly as per the provisions of the Act it is entitled to sue for

eviction of the building occupied by the tenant. Therefore, Company which is a juristic person is also entitled to claim eviction u/s 11(3) of the Act.

The argument to the contrary advanced by the learned Counsel for the revision Petitioner is thus turned down.

It was also argued by the learned Counsel for the revision Petitioner that the petition schedule building is a very tiny room, the demolition of

which is not at all required for constructing a multi storied building. The learned Counsel submits that though the Respondent had obtained plans

from the local authority, they did not start the construction of the building. According to the Petitioner the only idea is to eject the tenant, for,

otherwise, the landlord could have started construction of the building. It is also contended that a perusal of the plans would make it clear that the

site of the petition schedule building does not form the area where the proposed construction is to be had. Ext.(sic) A5 series are the plans

produced by the landlord. It is pointed out that the petition schedule building is to provide the main entrance from the State Highway and that if

only the petition schedule building is demolished and removed the materials can be taken to the property Reconstruction of the building. Even

though it is a tiny building, just abutting the highway, it is not at all possible for the landlord to construct the nine storied building, without removing

scheduled building. These aspects were also considered in detail by the Rent Control Court and learned Appellate Authority. We are reminded of

the contours of our jurisdiction u/s 20 of the Act. The findings of fact entered by the authorities based on legal evidence cannot be upset by this

Court in revision. Therefore, the finding that the need urged by the landlord is bona fide stands confirmed.

Though the revision Petitioner contended that he is entitled to the protection under the Second Proviso to S. 11(3) he could not adduce

satisfactory evidence to prove the two limbs of the Second Proviso and hence claim for protection was turned down. The order of eviction passed

by the courts below is only to be confirmed.

The result, therefore, is that this re vision fails and is dismissed.

Sri. Jayakrishnan the learned Counsel for the revision Petitioner submits that at least one year time may be granted to the Petitioner to

surrender possession of the petition schedule building. Sri. Mathew John, the learned Counsel for the landlord has resisted this request. He points

out that the company could not proceed with the work only because the petition schedule building could not be demolished and removed.

However, we are inclined to grant time to the revision Petitioner till 30.4.2012 but on the following conditions: