ivil Appeal No 1993 of 1982
From the Judgment and Order dated 921982 of the Delhi High Court in SAO No 59 of 1979
MKRamamurthi Mrs Chandan Ramamurthi and MAKrishnamoorthi for the Appellants
Harish N Salve and AKSanghi for the Respondents
The Judgment of the Court was delivered by TKTHOMMEN J
This appeal arises from the judgment of the 476 Delhi High Court in SAONo
59 of 1979 whereby the High Court reversing the concurrent findings of the Additional Rent Controller and the Rent Control Tribunal allowed the respondent landlord s application for eviction of the appellant tenant under section 141e of the Delhi Rent Control Act 1958 the Act 
The respondent is the daughter of the original landlord who had let out the premises to the appellant on 1101961
The present respondent purchased the property from her father on 27th June 1964 and thus stepped into his shoes as the landlord  as defined under section 2e of the Act
Relying upon the Rent Note and the appellant s letters dated 7101961 and 1881962 addressed to the respondent s father and the earlier proceedings between them for eviction of the appellant on the ground of sub letting the premises for commercial purposes both the statutory authorities found that the premises which had been let out for residential purposes to the appellant had also been used incidentally for commercial purposes so as to exclude the application of section 14 1 e read with the Explanation thereto
This finding was reversed by the High Court by the impugned judgment
This High Court found that there was no evidence for the statutory authorities to come to the conclusion which they did as regards the premises having been used for commercial purpose
This is what the High Court says  
No documentary evidence has been brought on record to hold that the premises were ever used for boarding and lodging foreign students Thus there is no evidence on record to hold that the premises were used for boarding and lodging of the foreign students or that the premises were let to the respondent for commercial purposes
Thus I am of the view that the premises were let to the respondent for use as residence and the findings to contrary by the controller and the Tribunal are without any evidence on record and are perverse
This finding of the High Court is in our view unsustainable
The High Court was not justified in saying that there was no evidence to hold that the premises were used for boarding and lodging foreign students
The specific plea of the landlord in the earlier proceedings was that the tenant had sub let the premises for commercial purposes
The tenant contended that she had never parted with her exclusive possession of any part of the premises and the foreign students who were lodging were her paying guests and were not her tenants
The plea of sub tenancy raised by the landlord was thus rejected on the ground that those who logged with her were not sub tenants but only paying guests
Letters dated 7101961 477 and 1881962 addressed by the appellant tenant to the respondent landlord were considered by the authorities in coming to the conclusion which they did
These letters clearly disclosed the fact that foreign students were lodged in the evidence let in by the appellant and not contradicted by the respondent clearly showed that apart from the appellant all the other inmates of the premises were foreign students staying with her as her paying guests
The appellant testified to the effect that she earned her livelihood from the income she received as lodging fee from students who lodged with her
It was out of that income that all her personal expenses including the rent payable by her for the premises had been met
These are the findings of the two fact finding authorities and those findings are based on oral and documentary evidence
To have reversed those findings by the High Court in Second Appeal on the ground that they were perverse was totally uncalled for
Mr Harish Salve appearing for the respondent landlord submits that even if the High Court was wrong in coming to the conclusion that there was no evidence about foreign students stayed as paying guests in the premises did not imply either that they lodged with the consent of the landlord or that such lodging amounted to a commercial use of the building
Counsel submits that the High Court was right on the facts of this case in saying that the ground contained in clause e of section 1 of section 14 was attracted
There is no substance in the contention that the landlord was unaware that the premises had been used for lodging foreign students
The two letters relied on by the statutory authorities leave no doubt that this fact was well known to the landlord at all material times
To the knowledge of the landlord the premises have been regularly used by the tenant ever since 1961 for the residence of not only herself but also of the foreign students who were lodged by her for gain as paying guests
The evidence is that she had no income other than what she received as lodging fee from foreign students
The question then is whether the facts found excluded the application of the ground contained in clause e of the section 14 1
Section 14 insofar as it is material reads S14
Protection of tenant against eviction 1 Notwithstanding anything to the contrary contained in any other law or contract no order or decree for the recovery of possession of any premises shall be made by any court or Controller in favour of the landlord against a tenant 478 Provided that the Controller may on an application made to him in the prescribed manner make an order for the recovery of possession of the premises on one or more of the following grounds only namely e that the premises let for residential purpose are required bona fide by the landlord for occupation as a residence for himself or for any member of his family dependent on him if he is the owner thereof or for any person for whose benefit the premises are held and that the landlord or such person has no other reasonably suitable residential accommodation Explanation For the purposes of this clause premises let for residential purposes include any premises which having been let for use as a residence are without the consent of the landlord used incidentally for commercial or other purposes
The only ground which is relied on by the landlord is that which is contained in clausee read with the Explanation
Clause e on the facts alleged is applicable only if the landlord is in a position to establish that the premises let for residential purposes are required bona fide by him for occupation as a residence
Assuming that the bona fide requirement of the landlord is established the landlord must still prove that the premises had been let for residential purposes
The Explanation to clause e makes it clear that the words premises let for residential purposes  include any premises let for residential purposes but used incidentally without the consent of the landlord for commercial or other purposes
The Explanation is attracted when i the premises have been let for residential purposes ii the premises have been used incidentally for commercial or other purposes and iii the landlord had not given his consent for such incidental use for commercial or other purposes
If the three ingredients contained in the Explanation are attracted the premises do not cease to be Premises let for residential purposes falling under clause e
In respect of such premises the bona fide requirement of the landlord referred to in clause e is a ground for eviction
If the premises have never been used for any non residential purpose the aid of the Explanation is unnecessary to attract clause e
The Explanation is called in aid only where premises let for residential purposes have been used incidentally for commercial or other non residential purposes but without the consent of the landlord
The fundamental question in respect of residential premises is whether the landlord had consented to the user of the premises for any other purpose albeit incidentally
479 If the landlord is in a position to establish that the premises have been let for residential purposes and that he has never consented to the user of the premises for any other purpose the mere fact that such premises have been incidentally used for commercial or other purposes would not change or affect the residential character of the premises
In respect of such premises it is open to the landlord to prove his bona fide requirements and thus establish the ground mentioned under clause e
On the other hand if the premises have been regularly and openly used for non residential purposes the knowledge and constant of the landlord unless proved to the contrary are ordinarily presumed and in that event the Explanation would be of no avail to save the ground under clause e
In the present case it is not disputed that the premises had been let for residential purposes but it is also beyond doubt that to the knowledge of the landlord the premises have been regularly used by the tenant not only for her own residence but also for her foreign guests
The landlord has at all material times known or is presumed to have known that foreign students have been staying with the appellant as her paying guests and that she has been ever since 1961 running a boarding house in the premises
At no time did the landlord object to the user of the premises by the appellant for such purpose
The continued user of the building ever since 1961 for the purpose of lodging paying guests shows that the respondent landlord and her father have not only been aware of such user of the building but have also impliedly consented to such user
This presumption is irresistible from the evidence on record
Such user takes the premises in question out of the ambit of premises let for residential purposes  so as to exclude the ground contained in clause e
We are fortified in our conclusion by the views expressed by this Court in Dr Gopal Dass Verma vs Dr SK Bhardwaj  Anr  and Kartar Singh vs Chaman Lal  Ors SC 1969 IV All India Rent Control Journal 349
The position would have been probably different and the Explanation would have been still available had foreign guests been lodged only occasionally and for short periods even if it be on the basis of payment to cover expenses
All this is a question of intention
Was it an occasional accommodation of paying guests consistently with the character of the premises as a private residence The evidence on record leaves no doubt that the premises have been regularly used by the appellant as a boarding house and not as a private 480 residence in the ordinary acceptation of the term
She has in fact been carrying on in the words of Romer J a species of business
See Hobson vs Tulloch 1898 1 Chancery Division 424
See also Thorn  Ors
vs Madden and Tendler vs Sproule 1947 1 All ER 193
In the absence of any question of law much less any substantial question of law the High Court was not justified in reversing the concurrent findings of the statutory authorities
In the circumstances we set aside the impugned judgment of the High Court and restore the orders of the Additional Rent Controller dated 2991976 and Rent Control Tribunal dated 18111978
The appeal is allowed in the above terms with the costs of the appellant throughout
NVK Appeal allowed


Summary:
The respondent s land admeasuring 5 acres 589 13 Sq yards was acquired by the State Government in 1963 for a housing scheme and compensation at Rs158 per Sq yard was awarded
On reference the Civil Court enhanced the compen sation to Rs 10 per Sq yard with solatium at 15 per cent and interest at 4 per cent
On appeal and cross appeals the High Court confirmed the award
In the appeal before this Court on behalf of the De partment it was contended that the respondent had purchased the land in question in 1961 in three documents at Rs042 p per sq yard and sold in 1963 one acre of the land at Rs5 per sq yard and therefore the deeds under which the transactions took place reflected the prevailing market value of the land in question and courts below committed grave error in relying on a decision of the High Court awarding Rs 10 per sq yard in respect of another land acquired under a Notification of 1961 and that when a large extent of land was acquired for a housing scheme at least 13 of the land should be deducted towards laying the roads setting up parks drainage and other amenities
Allowing the appeal this Court HELD 11 The market value postulated in Section 231 of the Land Acquisition Act 1894 is designed to award just and fair compensation for the lands acquired
The word market value would postulate price of the land prevailing on the date of the publication of the notifica 473 tion under Section 41
In determining the market value of the land the price which a willing vendor might reasonably expect to obtain from a willing purchaser would form the basis
For ascertaining the market rate the Court can rely upon such transactions which would offer a reasonable basis to fix the price
The price paid in sale or purchase of the land acquired within a reasonable time from the date of the acquisition of the land in question would be the best piece of evidence
In its absence the price paid for a land pos sessing similar advantages to the land in neighbourhood of the land acquired in or about the time of the notification would supply the data to assess the market value
475E G Periya  Pareekanni Rubbers Lief
vs State of Kerala 1990 Supp 1 SCR 362 referred to 12 In the instant case admittedly the claimant pur chased land at Rs042 p and in a span of one year and four months sold at Rs5 per sq yard
When the claimants them selves sold as a willing seller of an acre of land  Rs5 per sq
yard if a large extent of five acres and odd under acquisition is offered to be sold as a block it would not fetch higher rate but surely be negotiated for a lesser rate if not the same market value of Rs5 due to time lag of nine months
May be the payment of Rs 10 per sq yard to the owner of another land acquired in 1961 was a windfall
Taking the totality of the facts and circumstances the High Court committed grave error in completely ignoring the sale transactions of the lands under acquisition
In view of the time lag the prevailing market value of the land as on the date of the notification would be Rs6 per sq yard
476B E G 13 In Building Regulations setting apart the lands for development of roads drainage and other amenities like electricity etc
are condition precedent to approve lay out for building colonies
Therefore based upon the situation of the land and the need for development the deduction shall be made
Where acquired land is in the midst of al ready developed land with amenities of roads drainage electricity etc
then deduction of 13 would not be justi fied
In the rural areas housing schemes relating to weaker sections deduction of 14 may be justified
477G H 478A Spl
Tehsildar Vishakapatnam vs Rednam Dharma Rao  Ors CA No 4187 of 1982 decided on July 17 1990 Tribeni Devi  Ors
vs Collector of Ranchi  at 213 Smt
Kaushalya Devi Bogre  Ors
vs The Land Acquisi tion Officer Aurangabad   Vijay Kumar Motilal vs State of Maharashtra  Vijay singh Liladhar vs Special Land Acquisition Officer 760 Spl
Land Acquisition Officer Bangalore vs
T Adinaray an Setty 1959 Sppl
1 SCR 404 and The Tehsildar Land Acquisition Vishakapatnarn
P Narasing Rao  Ors  relied on 14 In the instant case 13 of the market value should be deducted for development of the lands
478B 15 The market value is determined at Rs6 per sq yard and after deducting 13 for development of lands it would be Rs4 per sq yard
478C 2
It is settled law that when wrong application of a principle has been made or important points affecting valua tion have been overlooked or misapplied by the High Court or Reference Court this Court would under Article 136 of the Constitution correct the same
The Spl
Land Acquisition Officer Bangalore vs
T Adina rayan Setty 1959 Suppl
1 SCR 404 Dattatrayaya Shankarb hat Ambalgi and Ors
vs The Collector of Sholapur and Anr  The Dollar Co Madras vs Collector of Madras and Padma Uppal etc
vs State of Punjab  Ors
   relied on