IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.R.RAMAN & THE HONOURABLE MR. JUSTICE T.R.RAMACHANDRAN NAIR WEDNESDAY, THE 18TH JUNE 2008 / 28TH JYAISHTA 1930 RCRev..No. 399 OF 2005() ------------------------ RCA.21/2004 OF THE RENT CONTROL APPELLATE AUTHORITY, NORTH PARAVUR RCP.20/2002 OF THE RENT CONTROL COURT, ,ALUVA .................... REVISION PETITIONERS/RESPONDENTS/RESPONDENTS 1. THE NEW INDIA ASSURANCE COMPANY LTD., NO. 87, M.G.ROAD, FORT MUMBAI-400 023. 2. THE MANAGER, THE NEW INDIA ASSURANCE COMPANY LTD., ANGAMALY. BY ADV. SRI.P.R.RAMACHANDRA MENON RESPONDENT/APPELLANT/PETITIONER: V.V. SEKHAR, S/O. V.K. VELAYUDHAN, VALLATHERY HOUSE, ANGAMALY. BY ADV. SRI.S.ANANTHAKRISHNAN SRI.N.K.SUBRAMANIAN THIS RENT CONTROL REVISION HAVING BEEN FINALLY HEARD ON 18/06/2008, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: R.C.R. 399/2005 ORDER ON I.A. NO. 2761/2005 IN RCR 399/2005 // DISMISSED // 18.6.2008 SD/-, P.R. RAMAN, JUDGE. SD/- T.R. RAMACHANDRAN NAIR, JUDGE. // TRUE COPY // P.S. TO JUDGE. KNC/- P.R. RAMAN & T.R. RAMACHANDRAN NAIR, JJ. = = = = = = = = = = = = = = = = = = = = R.C.R. 399 of 2005 = = = = = = = = = = = = = = DATED THIS, THE 18TH DAY OF JUNE, 2008. O R D E R Raman, J. This is a revision at the instance of the tenant - a public sector undertaking, who is faced with an order of eviction passed by the Rent Control Court and confirmed by the appellate authority. 2. The landlord sought eviction on the ground of bona fide need under Section 11(3) of the Kerala Buildings (Lease & Rent Control) Act. The case of the landlord was that the rented premises was let out to the New India Assurance Company, on a monthly rent of Rs. 2,843/-, with a condition to extend the period of rent in every five years. The initial entrustment was in 1987 and the last renewal expired on 31.8.2002 and thereafter, no renewal lease effected. According to him, it was agreed that either of the parties can terminate the lease arrangement by giving three months notice in writing. The landlord, who is a Chartered Accountant, was born and brought up in Angamaly, where the building is situated. At the time of filing of the rent control petition, he was carrying on his profession in a building belonging to his brother-in-law at Ernakulam. He RCR 399/2005 :2: do not find it profitable or imperative to continue his profession at Ernakulam and since Angamaly being a place of his birth and a large number of people are known to him in that locality, he thought it advantageous to shift his practice to Angamaly and for that purpose he bona fide required the tenanted premises. It is also averred that there is no other building of his own in the said locality for the said purpose for which the building is sought to be vacated. Though the idea to start practice at Angamaly was conveyed to the tenant, the tenant expressed inability to give vacant possession for want of administrative sanction from higher authorities to shift the office immediately. In these circumstances, the landlord was forced to renew the agreement with a tacit understanding to vacate the premises at the earliest and hence he was constrained to continue his practice at Ernakulam. Since the owner of the building in which the petitioner is doing practice demanded vacant possession of the premises immediately, the landlord issued a lawyer notice to the tenant demanding to vacate the petition schedule premises. But they sent a reply stating that no other suitable accommodation is available in the locality to shift their office and hence the landlord has filed the rent control petition. 3. The tenant, in their written objection contended that the application is not maintainable, that initially the lease was for a period of RCR 399/2005 :3: five years on mutually agreed rent, that as per the conditions in the lease, once the tenant exercised his option to have the lease extended for a further period of five years the landlord has got only the right to insist for a higher rent which they were always ready and willing to pay, that the initial period of five years and the period for which the landlord has agreed to extent together the lease deed is for a period of ten years, but even before expiry of the said period of ten years the landlord has issued notice demanding to vacate the premises, which is hit by Section 11(9) of the Act, that the bona fide need is stoutly opposed since various buildings either in the possession or joint possession of the landlord happened to fall vacant which, however, he did not occupy, that even the up stair portion of the very same building which was let out to K.S.F.E. was got vacated but still that premises was not occupied by the landlord and therefore and the bona fide need put forth is only a ruse for eviction. 4. The evidence in the case consists of Exts.A1 to A3 marked on the side of the petitioner/landlord and Exts. B1 to B7 marked on the side of the respondent/tenant besides the oral testimony of PW.1 and RW.1. 5. The Rent Control Court, after analysing the evidence in the matter, found that the landlord started practising at Ernakulam as a junior of a reputed Chartered Accountant in the year 1992 and he continued his RCR 399/2005 :4: practice independently from 1998 onwards and he had an office at Ernakulam. Referring to his cross examination, it is stated that he admitted of doing audit work of various concerns. Though the respondent/landlord contended that the office is functioning in the ground floor of the building, it was found that there is no evidence to show that the office was conducted in a room owned by his brother-in-law. It was found that the statement of the landlord that his brother-in-law is the owner of the building and he has demanded to vacate the building, has no merit. Referring to the contention that there is no other building other than the petition schedule building in Angamaly town to shift his business, it was found that the petition schedule premises is situated in a three-storied shopping complex and referring to the evidence of PW.1 the Rent Control court proceeded to say that the petitioner started his career since 1992; but he wanted to shift his practice to Angamaly to better his prospects since his father died in the 1991. Therefore, the rent control court says if the reason for shifting the practice was the death of his father, then normally, petitioner would not have started his practice in 1992 at Ernakulam. Therefore, according to the rent control court, the case of the landlord that he requires the building for shifting his practice from Ernakulam is not true. The bona fide need as put forth by the petitioner was found against and the petition was dismissed. RCR 399/2005 :5: 6. The appellate authority re-appreciated the evidence on record and found that the period of five years initially fixed in the agreement expired in 2002. After referring to the recitals contained in Ext.A1 lease deed, it was held that the tenancy commenced even prior to the execution of Ext.A1 and therefore, the finding of the rent control court that the petition for eviction was barred by Section 11(9) of the Act was found against. 7. The learned counsel appearing on behalf of the revision petitioner supports the finding of the rent control court under Section 11(9) of the Act. We may now consider as to whether the present petition is barred under Section 11(9) of the Act. Admittedly, Ext.A1 was dated 11.10.1999. The agreement itself contains a recital that the term of lease is for a period of five years from the date of 1st September, 1997. Therefore, the five years period of the term of the lease will expire from the first day of September, 2002. Clause (2) of the proviso contained in the deed reads as follows: "If the lessee shall be desirous of renewing the terms hereby created on the expiration thereof and of its such desire shall give to the lessor or atleast three months notice in writing in that behalf before the expiration of the term hereby created than the lessor shall at cost of the lessee and the lessor in equal share grant to the lease of the demised premises for a further term of 5 years w.e.f. 1.9.2002 at mutually agreed rates on executing a fresh deed of lease." RCR 399/2005 :6: 8. Placing reliance on the aforesaid clause, it is contended that once the revision petitioner exercises a further option to have a further lease, the landlord is bound by the agreement to extend the period for a further period of five years, with the only reservation that he could ask for a better rent, since it is mutually decided, for the further period of five years. 9. We have carefully considered this clause. There is force in the argument that on the expiry of the initial period of five years which, as per the terms of the agreement is on 1.9.2002, there is a stipulation enabling the revision petitioner to exercise an option by giving three months notice for a renewal of the lease for a further period of five years subject to the rent being mutually agreed upon on executing a fresh deed of lease. But the tenant has not raised any specific plea that he has exercised any such option under the second proviso of the rent deed and the argument now raised is without any plea. Further, no evidence of having exercised the option has been produced in the case. As such we do not think that the revision petitioner/ tenant is entitled to raise this plea before us for the first instance. If so, we have to proceed on the presumption that the term expired on 1.9.2002 and the rent control petition filed only in December, 2002, which is after the expiry of the initial period of five years,therefore, is not hit by Section 11(9) of the Act. RCR 399/2005 :7: 10. Regarding the bona fide need, while reversing the order of the rent control court, the appellate authority found that the appellant/landlord has admitted that himself and his brothers have put up a commercial shopping complex wherein he has only a fractional share and further deposed that there is no other vacant building available to him to start his career as Chartered Accountant and that in the new building constructed by his brothers he is no right as such. The brothers have constructed commercial complex in the land belonged to them and the petitioner. But in the building as such, the landlord has no right of ownership and he has no other building of his own. Therefore, in the absence of any evidence to show that the landlord is in possession of any building of his own to accommodate his office of Chartered Accountant, the contention raised by the revision petitioner/tenant that there are other buildings available, was rejected. It was the case of the landlord that he was allotted only the room which is let out to the respondent in the shopping complex wherein the petition schedule building is situated and on the side of the petition schedule room there is a side room having an area of 400 sq.feet. It was pointed out by the revision petitioner/tenant that the landlord could very well use the said area if he really wanted to accommodate his office at Angamally. But referring to the evidence of PW.1 the appellate authority found that it is not RCR 399/2005 :8: suitable for accommodating an office. The element of choice in the matter of accommodation is on the landlord. Further, the appellate court found that the tenant has no case that the landlord is occupying his own building in Ernakulam and he wanted to shift his office. The appellate court, on an overall consideration of the evidence, found that the finding of the rent control court that the landlord is not entitled for eviction cannot be sustained in the eye of law. 11. We have considered the rival submissions made by the parties regarding the bona fide need as alleged by the landlord in the petition for eviction. The fact that the landlord is a qualified Chartered Accountant is not disputed. That he is having an office at Ernakulam in a building which does not belong to him is also beyond dispute. At any rate, the bona fide need as put forward by the landlord is to shift his office to Angamaly, which is his place of birth. His father's death one year prior to his starting practice at Ernakulam, is high lighted by the rent control court and observed that if as a matter of fact, the death of the father of the landlord which prompted him to shift his practice to Angamaly, he would have done it even in the year 1992 itself. We cannot appreciate this stand of the rent control court. Admittedly, the building was outstanding in possession of the tenant even during that period. Therefore, one cannot possibly start a RCR 399/2005 :9: business unless he gets vacant possession of the building. If in 1992 the building was kept vacant and still the landlord had started his practice at Ernakulam, that is a different matter. But there is no case for the tenant that any building was lying vacant during the period 1992 enabling the landlord to start his practice at Angamaly. 12. In such circumstances, the fact that he has initially started his practice at Ernakulam in 1992 itself cannot be held as a reason to hold that the petition lacks bona fide. No suitable building was proved to be in the possession of the landlord so as to disentitle him to get an order of eviction on the ground of bona fide need. The fact that his brothers might have constructed a building or that a room having 400 sq.ft. space may be available in the same building by itself is not a reason to show that the landlord has no bona fide need. When the petitioner himself has a building and when he wants to get vacant possession of the same, the tenant cannot dictate him that he may start his business in any other building owned by his brothers. There is absolutely no evidence to show that there was any building available of which the landlord is the absolute owner and that he was in possession of the same on the date on which the eviction petition was filed. The bona fidie need as pleaded by the parties has to be adjudged on the date on which the petition was filed before the rent control court. RCR 399/2005 :10: Further, even though there is a clause in the agreement providing for a mutually agreed rent to be paid to the extended lease period of a further period of five years, he did not chose to get a higher rent; but filed a petition for eviction since his idea was not to get a better rent from the building rather he wanted the building for own occupation and thus adds strength to the plea of bona fide need. Accordingly, we find that the reason given by the appellate court and the finding that the landlord has proved his bona fide is more probable to be accepted in preference to the order passed by the rent control court. The appellate authority having taken a reasonable view of the matter, we do not find the finding of that authority could be interfered with in this revision. In the result, the revision petition lacks merit. It is accordingly dismissed. Considering the fact that the revision petitioner is a public sector undertaking carrying on business in the petition schedule building for the past several years, we think it is only appropriate that they be given sufficient time to find an alternate accommodation to shift their business. Accordingly, we direct that the execution of the order passed by the appellate court shall stand deferred for a period of six months from today on the following conditions: RCR 399/2005 :11: i. The revision petitioner/tenant shall file an undertaking in the form of an affidavit before the court below, within a period of one month from today, undertaking to surrender vacant possession of the petition schedule premises within a period of six months from today. ii. They shall pay/deposit the entire arrears of rent, if any, within the aforesaid period of one month and continue to pay/deposit an amount equivalent to the monthly rent by way of compensation for use and occupation until vacant possession of the petition schedule premises is given to the landlord. iii. They shall also undertake that they shall not induct any third parties in to possession. In case the revision petitioner fails to comply with any one of these conditions, the landlord will be entitled to enforce the order of eviction passed by the court below without any further delay. P.R. RAMAN, (JUDGE) T.R. RAMACHANDRAN NAIR, (JUDGE) knc/-