CR No. 3105 of 2010 1 In the High Court of Punjab and Haryana, Chandigarh. CR No. 3105 of 2010 (O&M) Date of Decision:23.08.2010 Balbir Kaur and others ...Petitioner s Versus Roop Lal and others ....Respondents. C.R. No.3106 of 2010 Balbir Kaur and others ...Petitioners Versus Kishan Chand and another ....Respondents. Coram:- Hon'ble Mr. Justice Alok Singh 1.Whether reporters of local news papers may be allowed to see judgement ? 2. To be referred to reporters or not ? 3. Whether the judgement should be reported in the Digest ? Present: Mr. Kanwaljit Singh, Sr. Advocate with Mr.S.D. Bansal, Advocate for the petitioners. Mr. Arun Jain, Sr. Advocate with Mr. Jaiveer Chandel, Advocate Mr. R.S. Rai, Sr. Advocate with Mr. Anil Aggarwal, Advocate ... Alok Singh, J. Landlords have invoked revisional jurisdiction of this Court Section 15(5) of the East Punjab Urban Rent Restriction Act, 1949 CR No. 3105 of 2010 2 (hereinafter referred to as the 1949 Act), challenging the order dated 17.9.2005 passed by the Rent Controller, Chandigarh, as well as judgement/order dated 20.4.2010 passed by the Appellate Authority under the Rent Act, Chandigarh. Brief facts of the present case are that landlords preferred eviction petition against the tenant on the ground, inter-alia, that tenant – respondent is occupying demise premises situated on the ground floor of SCO Nos.102-02-03, Sector 17-C, Chandigarh on a monthly rent of Rs.3000/- per month in addition to electricity charges. Due to liberalization of the policies by Government of India, since 1991, rebate/incentives are given to the NRIs, the petitioners decided to set up a departmental store of world repute to give latest modern items to the residents of Chandigarh and the petitioners have decided to start the business in the entire building comprised of six floors including the ground floor and basement. Petitioners No.3 and 4 are engaged in business in Singapore, Europe, Australia, Canada, America. Petitioner No.2 also decided to settle in India in his native country and to do the business in Chandigarh with the assistance of petitioner No.4; petitioner No.1 the real sister shall also join petitioners No.3 and 4 alongwith her son, who has completed his MBA study and wants to settle in marketing. The son of petitioner No.2 has not yet settled anywhere, although, he was made to settle in Singapore, Brunei Darusslam etc. but he has all interest in India and is adamant to settle his life in India; petitioners got a portion vacated on the ground floor and basement, but the said portion is neither suitable nor sufficient to start the departmental store of their choice; petitioners do not own and occupy any other commercial building in the urban area of Chandigarh nor have they CR No. 3105 of 2010 3 got vacated any such building in this area, after the commencement of the Act. Respondent – tenant contested the claim of the revisionist -landlords and stated in the written statement that the demise tenanted premises was leased out to them about 22 years ago at the then rent of Rs.750 per month with rebate of Rs.100/-, which was lastly enhanced Rs.800/- per month with effect from 1.5.1986, excluding water and electricity charges. It was further contended by the tenant that earlier also eviction petition was filed by the against the tenant where a settlement was arrived at between the parties and the rent was enhanced to Rs.3000/- excluding water and electricity charges with effect from 1.4.1991, whereby tenancy was created afresh in favour of the respondent. It was contended by the tenant-respondent that petitioner No.1 is a housewife and very well settled in her old age with her husband in Amritsar for the last number of years, petitioner No.2, mother of petitioners No.1, 3 and 4 is about 80 years of age and presently settled in Bruine, Darussalam where she is doing business and is otherwise permanently settled in Ajmer, Rajasthan. It is further stated that petitioners No.3 and 4 are already engaged in running there business in Singapore, Europe, Austrailia, Cananda and America for the last number of years and hence, they have absolutely no need to start business by way of opening a huge Departmental Store in the entire building. It is further stated by the tenant that the petitioners got vacated built up accommodation situated on the ground floor of SCO No.101-02-03, Sector 17-C, Chandigarh from the then tenant Dr. S.P. Bedi and they have not started any business therein. The further contention of the tenant – respondent is that Punjab Scheduled Castes Financial Corporation, CR No. 3105 of 2010 4 Chandigarh (hereinafter referred to as the Corporation) is in occupation of first, second and third and fourth floor of the above said SCO, whose lease had expired and thereafter, a fresh lease was created by the petitioners in favour of the Corporation increasing rent from Rs.68,300/- to Rs.1,97,955/-, per month excluding water and electricity charges with an increase of 5% for the successive years. Had there been any need, petitioners would not have entered into fresh deed with the Corporation. It was further submitted by the tenant that a portion measuring 8’X 11” situated on the ground floor, adjacent to the staircase of SCO Nos.102-02-03, Sector 17-C, Chandigarh is also in the possession of the petitioners, hence if they intend to start any Departmental Store, they could have started on the ground floor area of about 1300 square feet in their possession. It is further stated that eviction petition is nothing but abuse of process of law, which was filed to pressurize the tenant and with ulterior motive to enhance rent or alienate the property at an exorbitant rates after getting it vacated from the tenant. The Rent Controller vide impugned order dated 17.9.2005 dismissed the eviction petition by observing that all the petitioners are well settled abroad. They are occupying ground floor area of about 1300 square feet in their possession and had there been any need, they would have started their Department Store in the premises got vacated by them from Dr. Bedi. The Rent Controller also observed that no efforts were made by the petitioners – landlords to get the portion vacated from the corporation, rather on the enhanced rent, Corporation was allowed to continue as tenant. Order dated 17.9.2005 passed by the Rent Controller was challenged before the Appellate Authority by the landlords –revisionists herein. CR No. 3105 of 2010 5 During the appeal, tenant preferred an application for amendment in the written statement on 13.3.2007, stating that the petitioners have negotiated and have given the whole ground floor of SCO Nos.102-02-03, Sector 17-C, Chandigarh to a new concern, namely, M/s. ESPRIT, who are carrying on the business of ESPRIT. Amendment application was allowed by the Appellant Authority vide order dated 28.7.2008 and the Appellant Authority remitted the matter to the Rent Controller to frame fresh issue, if so required, on the amended pleadings of the tenant and the Rent Controller was directed to record the evidence and send the file as early as possible. Before the Rent Controller, both the parties led evidence on the amended pleading, more particularly franchise agreement of ESPRIT was produced before the Rent Controller. The Rent Controller having recorded the evidence, sent the record to the Appellate Court. The Appellate Authority dismissed the appeal of the landlords on the ground that all the petitioners are well established in their lives and they do not intend to start any Departmental Store as suggested by the petitioners. It is further observed by the Appellate Authority that during the pendency of appeal, petitioners have let out ground floor portion, which was got vacated from Dr. Bedi to M/s. ESPRIT and the alleged franchise agreement is in fact a shame transaction and amounts to lease. The Appellate Authority also observed that non-filing of eviction petition against the Corporation during the pendency of the eviction petition before the Rent Controller, is a fatal to the landlords, which go on to suggest that the landlords in fact have no need and their need is not genuine. The Appellate Court did not find favour with the landlords on the point that CR No. 3105 of 2010 6 during the pendency of the appeal, landlords have also filed eviction petition against the Corporation, which is subjudice before the Rent Controller. Ultimately, appeal was dismissed by the impugned order dated 20.4.2010. I have heard learned counsel for the parties and perused record carefully. Undisputedly, the petitioners are reputed big businessmen having business in various countries including India. Undisputedly, landlords have financial capacity to start a big Departmental Store in the city of Chandigarh. Undisputedly, during the pendency of the eviction petition, landlords have entered into an agreement dated 17.5.2006 with M/s. Aditya Birla Nuvo to sell the product of ESPRIT in the ground floor of the building in question, which was got vacated from Dr. Bedi. Undisputedly, landlords have also filed eviction petition on the ground of bonafide need against the Corporation, which is subjudice. The Apex Court in Sarla Ahuja Vs. United India Insurance Co. Ltd., reported in 1998(8) SCC 119, in paragraph 14 while interpreting the provisions of Delhi Rent Control Act, has held as under: - “When a landlord asserts that he requires his building for his own occupation the Rent Controller shall not proceed on the presumption that the requirement is not bona fide. When other conditions of the clause are satisfied and when the landlord shows a prima facie case it is open to the Rent Controller to draw a presumption that the requirement of the landlord in bona fide. It is often said by courts that it is not for the tenant to dictate terms to the landlord as to how else he can adjust CR No. 3105 of 2010 7 himself without getting possession of the tenanted premises. While deciding the question of bona fides of the requirement of the landlord it is quite unnecessary to make an endeavour as to how else the landlord could have adjusted himself.” The Apex Court in the matter of Maganlal Vs. Nanasaheb 2009(1) Civil Court Cases 102 (SC) in paragraph 16 has held as under: - “This Court in Sait Nagjee Purushotham & Co. Ltd. v. Vimalabai Prabhulal & Ors. (2005) 8 SCC 252 held that it is always a prerogative of the landlord that if he requires the premises in question for his bona fide use for expansion of business, this is no ground to say that the landlords are already having their business at Chennai and Hyderabad, therefore, it is not genuine need. Further, it is held that it is not the tenant who can dictate the terms to the landlord and advise him what he should do and what he should not. It is always the privilege of the landlord to choose the nature of the business and the place of the business.” From the above dictum, it is well established that it is the prerogative of the landlord to expand his business. If landlord asserts that he requires the tenanted premises to expand his business, his need must be presumed as bonafide. Rent Controller shall not proceed to presume that alleged need is not bonafide. This is not open to the Rent Controller to say that landlords are already having business in different countries and cities and are well settled in their lives, hence do not require demised premises for setting up Departmental Store of world repute in Chandigarh City. Landlord is the best judge of his need and requirement. If landlords want to CR No. 3105 of 2010 8 open big Departmental Store in all the six floors of the building, tenant or Rent Controller have no business to dictate that landlords should start business in 1300 square feet ground floor area. Every landlord – human being has every right to expand business or to open new ventures. Neither Court nor tenant can curtail legitimate right of the landlord to expand the business or to start the new business, in the present case Departmental Store. Landlords are having very good financial status and are already running so many business in so many countries and cities, then the need of the landlords cannot be said to be ulterior or malafide. On this score, this Court finds that both the Courts below have exceeded their jurisdiction by saying that since the landlords are well- established and carrying on the business in different countries, they do not need to open the Departmental Store in India. Undisputedly, landlords have also initiated eviction proceedings against the Corporation, which is pending disposal before the competent Court. Merely because landlords have not filed eviction petition against all the tenants in one go for the same need and have filed petitions against the Corporation at the subsequent stage, does not mean that the landlords have no requirement for personal use and occupation of the entire building as set up by the landlords. Landlord is the master of his case and need and if he decides to file petition against the tenants at different stages for the same need, then landlord’s need cannot be said to be malafide. Now, the question comes as to whether landlords have let out the ground floor during the pendency of the petition in favour of M/s. ESPRIT. A copy of the agreement is placed on record. Clause 25 of the CR No. 3105 of 2010 9 agreement provides that the landlords shall remain in physical and legal possession of the property and the agreement does not create any right, title, interest, trust or tenancy in respect of the premises in favour of the company. Learned counsel for the landlords vehemently argued that this is the first step towards opening the Departmental Store of world repute in the building in question. Learned counsel for the landlords further argued that the trial Court disbelieved the bona fide need saying landlords have not started any business in the vacant portion and the Appellate Court is saying that the alleged need of the landlords is not bonafide because the landlords have moved one step ahead towards the establishment of the Departmental Store by entering into the agreement to sell the products of ESPRIT (M/s. Aditya Birla Nuvo) from the vacant portion on the ground floor. I find force in the arguments advanced by the learned counsel for the landlords. In the opinion of this Court, the agreement dated 17.5.2006 between M/s. Aditya Birla Nuvo and landlords to carry on the franchise business of ESPRIT of global lifestyle brand does not amount to lease. It is a simpliciter franchise agreement. One has to see intention of the parties. There was absolutely no material before the Appellate Court to say that agreement dated 17.5.2006 is a lease. Once possession remains with the landlords and the landlords are selling the items of M/s. Aditya Birla Nuvo, then it cannot be said to be a lease. To establish lease, possession has to be transferred in favour of the lessee, which admittedly is not done. Admittedly, possession is with the landlords. Mr. Arun Jain, learned and senior advocate assisted by Mr. Jaiveer Chandel, advocate vehemently argued that while exercising CR No. 3105 of 2010 10 revisional jurisdiction, this Court has limited power and this Court cannot disturb concurrent finding of fact of bonafide need as recorded by both the Courts below. The Apex Court in the matter of Vinod Kumar Arora Vs. Smt. Surjit Kaur, 1987(3) SCC 711, in paragraph 12 has held that the proposition of law put forward by the counsel (Hira Lal Vallabhram Vs. Sheth Kasturbhai Lalbhai and others, AIR 1967 SC 1653), is undoubtedly a well settled one but then it must be remembered that the rule would apply only where the findings have been rendered with reference to facts and not on the basis of non-existent material and baseless assumption. It is further held that if findings have been rendered either on non-existent or fictitious material, they cannot be therefore construed as findings of fact and once they cease to be findings of fact, they stand denuded of their binding force on the appellate or revisional Court. The Apex Court in the matter of Sarla Ahuja Vs. United India. Insurance Company, reported in 1988(8) SCC 119, in paragraph 11 has held that no doubt while exercising revisional jurisdiction reappraisal of evidence can be made but that should be for the limited purpose to ascertain whether the conclusion arrived at by the fact finding Court is wholly unreasonable. Undisputedly, petitioners are well settled businessmen having business in different countries and cities. If petitioners want to establish a Departmental Store of world repute in the city of Chandigarh, then need of the petitioners cannot be said to be not genuine and shall be presumed as genuine as held by the Apex Court in the case of Sarla Ahuja (supra) and in the case of Maganlal (supra). Hence, conclusion of both the Courts below CR No. 3105 of 2010 11 on the point of bonafide need is unreasonable, improbable and against the settled principle of law, hence interference by this Court is must. Moreover, the Appellate Court has wrongly held that the agreement dated 17.5.2006 is a lease agreement while as observed hereinabove, as per Clause 25 of the agreement, possession of the property shall remain with the landlords. From all the clauses of the agreement, it is clear that it is simple franchise agreement and does not amount to lease, hence, finding of the Appellate Court is not only perverse but against the terms and conditions of the agreement. The Appellate Court has misconstrued the agreement, hence while exercising revisional jurisdiction, this Court cannot shut its eyes. Mr. Jain further argued that after getting the demise premises vacated, landlords will not start business therein and shall alienate the property or let it out at exorbitant rent. Apprehension of the argument of the learned counsel for the tenant seems to be misconceived in view of Section 13(4) of the Act. To appreciate the argument of Mr. Jain, learned senior advocate, this Court would like to reproduce Section 13(4) of the Act, which reads as under: - “13(4) Where a landlord who has obtained possession of a building or rented land in pursuance of an order under sub- paragraph (i) or subparagraph (ii) of paragraph (a) of sub- section (3) does not himself occupy it or, if possession was obtained by him for his family in pursuance of an order under sub-paragraph (i-a) of paragraph (a) of sub-section (3), his family does not occupy the residential building, or, if possession was obtained by him on behalf of his son in pursuance of an order under subparagraph (iv) of paragraph CR No. 3105 of 2010 12 (a) of sub-section (3), his son does not occupy it for the purpose for which possession was obtained, for a continuous period of twelve months from the date of obtaining possession or where a landlord who has obtained possession of a building under sub-paragraph (iii) of the aforesaid paragraph (a) puts that building to any use or lets it out to any tenant other than the tenant evicted from it, the tenant who has been evicted may apply to the Controller for an order directing that he shall be restored to possession of such building or rented land and the Controller shall make an order accordingly.” From the perusal of sub-section (4) of Section 13 of the Act, it is clear that safeguard is provided by the legislature, if landlord or his family for whose benefit eviction was obtained, fails to occupy the premises for a continuous period of 12 months from the date of obtaining possession or where he puts that building to any use or lets it out to any tenant other than the tenant evicted from it, the tenant who has been evicted may apply to the Controller for an order and direction that he shall be restored to possession of such building. In the opinion of this Court, tenant has legal remedy available with him under Section 13(4) of the Act, in case landlords do not occupy the building for the purpose for which it was got vacated or alienate it or lease it out as apprehended by Mr. Arun Jain, learned senior advocate. In view of Section 13(4) of the Act, need alleged by the landlords must be presumed to be correct and genuine, unless of course, proved otherwise. In the present case, tenant could not prove that the need of the landlords is not genuine. Rather, on the basis of the apprehension, CR No. 3105 of 2010 13 tenant is denying need of the landlords and that apprehension is baseless as discussed hereinabove. In view of the discussions made hereinabove, this Court is of the opinion that the eviction petition was wrongly dismissed by both the Courts below, which ought to have been allowed. Present petition is allowed. Impugned orders are quashed. Eviction petition stands allowed. However, in the interest of justice, respondent-tenant is granted six months time to vacate the demise premises and hand over peaceful and vacant possession to the landlords, that subject to, of course, payment of monthly rent on or before 10th day of every month. No costs. A photocopy of the order be placed on the file of connected case. ( Alok Singh ) Judge 23.08.2010 sk.