IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Civil Writ Petition No.16455 of 2009 Date of decision: 12.05.2010 M/s Atma Ram and Sons (HUF), Shop No.56-57, Shopping Complex, Panjab University, Sector 14, Chandigarh, through Shri Karan Puri and another. ....Petitioners Versus Panjab University, Sector 14, Chandigarh, through its Registrar and others. ...Respondents Present: Mr. Sumeet Mahajan, Senior Advocate, with Mr.Sham Lal Bhalla, Advocate and Mr.Amit Kohar, Advocate, for the petitioners. Mr. Anupam Gupta, Advocate and Mr. Vikas Chatrath, Advocate, for the respondents. ---- II. Civil Writ Petition No.17037 of 2007 P.K. Bindra son of Shri K.L.Bindra, Shop No.51, Shopping Complex, Sector 14, Panjab University, Chandigarh. ....Petitioner Versus Panjab University, Chandigarh through its Registrar, Sector 14, Chandigarh, and another. ...Respondents Present: Mr. D.R.Bansal, Advocate, for the petitioner. Mr. Anupam Gupta, Advocate and Mr. Vikas Chatrath, Advocate, for the respondents. ---- CORAM: HON’BLE MR. JUSTICE K. KANNAN ---- Civil Writ Petition No.16455 of 2009 - 2 - 1. Whether reporters of local papers may be allowed to see the judgment ? Yes. 2. To be referred to the reporters or not ? Yes. 3. Whether the judgment should be reported in the digest ? Yes. ---- K.Kannan, J. I. Challenge to action for eviction under PP Act, subject matter 1. Both the writ petitions address the same issue relating to the orders passed under the Punjab Premises (Eviction of Unauthorized Occupants) Act of 1971 (hereinafter called 'the PP Act') and by the consent of both the counsel, they are taken up together and disposed of by a common order. II. Basis of complaints of the petitioners 2. The admitted case is that the petitioners in both the cases had been holding properties within the University Campus, which belonged to the University on lease. The lease period had expired and treating their respective possession as having become unlawful, actions for eviction have been taken. The eviction orders were passed by the Estate Officer and the appeals filed to the Additional District Judge confirmed the orders of eviction passed by the Estate Officer. While the petitioner in Civil Writ Petition No.16455 of 2009 was granted the lease for the purpose of running a bookshop, the petitioner in Civil Writ Petition No.17037 of 2007 was running the trade of Watches & General Store. As against the petitioner in the former case, their complaint was that the petitioner was attempting to change the nature of user and he had carried substantial alteration in the property without the authority of the University. The unauthorized act attributed to the latter is an alleged Civil Writ Petition No.16455 of 2009 - 3 - installation of a binding machine and doing unauthorized trade. In both the cases, the petitioners themselves had admitted to the fact that they had attempted to modify the respective trades and they sought for permission from the University for such changes. The University had not granted such permission, but decided after resolution, to evict the tenants. Both the petitioners have common grounds to contend that there are several shops within the University Campus and as and when the tenancy period expired, they were all renewed, but a discrimination had been practised only against the petitioners to evict them from the property. The petitioners, therefore, challenge the eviction also on the ground that the University, being an instrumentality of State, was bound to see that their actions were fair, just and reasonable. Complaining that the University was arbitrary in its action and discriminated between one tenant and another without sufficient justification, the petitioners contend that the action of the University in pursuing remedy for eviction against only the petitioners from amongst the host of tenants as violative of Article 14 of the Constitution and, hence, liable to be interfered with. III. Justification for action by the respondents 3. The respondents represented through counsel, Shri Anupam Gupta took me elaborately through provisions of the PP Act and through substantial number of decisions of the Hon'ble Supreme Court and of this Court while addressing arguments on the nature of possession after the period of lease had expired and when the University did not extend the lease. He would contend that the possession of the tenants became tenants at sufferance and the only limitation against a landlord was that Civil Writ Petition No.16455 of 2009 - 4 - the possession could have been interfered with, only by process known to law. The action under the PP Act itself was an action contemplated by law and no exception could be taken to the same. Addressing the issue relating to unfair and discriminatory action attributed to the University, the contention was that the petitioners had changed the nature of user of the property to a purpose unauthorized by the terms of the lease and, therefore, the petitioners were liable to be evicted. They had also caused substantial damage to the property and, therefore, there was sufficient justification for taking action only against the petitioners for eviction. Since the lease deeds executed in favour of the petitioners were through unregistered instruments and the terms of the lease were themselves sought to be pressed in service, I had asked the counsel to address arguments also on the admissibility of the unregistered instruments for user of the terms of the lease and the respective counsel had also advanced substantial arguments on the same. IV. Points for consideration 4. The points, therefore, that would arise for consideration are: (i) the extent of admissibility of the terms for the lease to complain of the change of the user or unauthorized user of the property; (ii) the nature of the possession of the tenants continuing in possession after the expiry of period of lease and (iii) the right of the landlord to take action for eviction complaining of change of user of the property by the tenants and the damage alleged to have been caused by them to justify the fairness action for eviction. Civil Writ Petition No.16455 of 2009 - 5 - (i) Extent of admissibility of unregistered lease deeds 5. It is necessary to advert to the extent of the admissibility of the respective lease deeds first, for, that will determine the complaints of unauthorized user and the justification for the action by the landlord. Both the parties agreed that the lease of the documents in relation to the immovable property were for period in excess of 1 year and, therefore, the documents required registration. Although the non-registration of the document itself was not a point of pleadings since it was an issue emerging from admitted facts and, in my view, it would have instant bearing to the ultimate result as well, I had called upon the parties to make their submissions on the same. The learned counsel appearing for the petitioner refers me to a decision of the Hon'ble Supreme Court in K.B.Saha and Sons Private Limited Versus Development Consultant Limited-(2008) 8 Supreme Court Cases 564. The Hon'ble Supreme Court was considering clause 9 of the lease deed which specified that the tenanted premises would be used and occupied by a particular officer of the Company and if the company intended to use the premises for occupation of any other officer, it would seek the written consent of the landlord. The terms further provided that the landlord had the option to agree or disagree to such a request. The tenant, however, allowed after vacation of the premises by a particular officer, yet another officer without the consent of the landlord. The landlord objected to the user by a person, who was not authorized and applied for action for eviction. The Hon'ble Supreme Court held, with reference to the unregistered nature of the document under Section 49(c) of the Registration Act and Civil Writ Petition No.16455 of 2009 - 6 - the proviso, that the admissibility of a document which was required to be registered under Section 17 shall be only for a collateral transaction. Explaining the meaning and scope of collateral transactions/purpose, it held that the collateral transactions must be independent of, or divisible from the transactions which required registration. It shall not by itself be registrable. However, the user of unregistered document to prove an important clause would not be called collateral purpose and in that case, the attempt of the landlord to use the document for identifying the person who could occupy and the requirement of a consent of the landlord for the user of any other person as essential terms of the document and it could not, therefore, be looked into for arriving at a conclusion that the tenant was liable to be evicted because of violation of the said clause. The attempt on behalf of the petitioners was that the so-called change of user of the property from bookshop to a departmental store in the case of the petitioner in Civil Writ Petition No.16455 of 2009 and by a change of user from a Watch Company to the use for binding of books by relying on the terms of lease with reference to the user amounted to proving the terms of the lease, which were impermissible. The landlord also relied on a clause in the rent deed that the tenant shall not put the premises to any other use including the allied and ancillary trade without the prior consent of the landlord and the change of trade without such consent would automatically amount to termination of the lease. The University further urged for its contention that there was another clause that provided that the tenant shall not cause any damage to the property and would hand over the premises in the condition as has been leased to him. Civil Writ Petition No.16455 of 2009 - 7 - The tenants had committed damage to the property and hence liable to be evicted. 6. The learned counsel appearing for the University would refer to a decision of the Hon'ble Supreme Court in Rai Chand Jain Versus Miss Chandra Kanta Khosla-AIR 1991 Supreme Court 744, that held, while considering the provisions of the East Punjab Rent Restriction Act that the issue whether a lease was for residential or non- residential purpose, was collateral to a transaction itself and hence, an unregistered lease deed could be looked into for such collateral purpose. He also refers to a Full Bench decision of Madhya Pradesh in Sardar Amar Singh and another Versus Smt. Surinder Kaur-AIR 1975 Madhya Pradesh 230, that held that the bar of reception of parole evidence would not extend to proving the nature of character in possession. The Full Bench was rejecting a contention that character of possession is also to be excluded by virtue of Section 91 of the Evidence Act which contained the rule of exclusion of parole evidence in respect of matters which were required to be reduced in writing. In my view, the issue of a collateral purpose will have to be decided on the facts and circumstances of each case. There is no denying the fact that a document which is required to be registered under Section 17 of the Registration Act, would be inadmissible as evidence of a transaction affecting the immovable property, except for a collateral purpose, as provided under the proviso under Section 49 of the Registration Act. While the nature of the user of the property as residential or non-residential could be well termed to be a collateral purpose, the clauses relating to the particular Civil Writ Petition No.16455 of 2009 - 8 - type of user and the consequences of any change of user as resulting in automatic termination of lease would result in giving effect to the terms of the document themselves. Even without reference to the terms of the document, there are implied terms and conditions as between the lessor and the lessee, as provided under Section 108 of the Transfer of Property Act. The provisions of Transfer of Property Act could still be attracted to supply the implied covenants of lease and they could be only substituted by specific terms in the lease deed to the contrary. A term in a lease deed which is required to be registered could be used to displace an implied covenant of lease set out through Section 108. To state the corollary, if there is a particular implied covenant protected under Section 108, the same cannot be substituted through a term in an unregistered document which is required to be registered. Such an implied clause would still govern, for a landlord and a tenant may not be able to use the terms of an unregistered lease deed at all. If it is unregistered and, therefore, the terms cannot be used, the parties could, in such a circumstance, rely on the terms of the Transfer of Property Act itself as governing the rights of the parties. 7. If during the continuance of the lease, the property required any repairs relating to integrity of the property and the landlord had failed to carry out the repairs in spite of notice, the tenant would be entitled to carry out such repairs. If the tenant's activity is at any time objected by the landlord on the ground that under the unregistered document, he was not entitled to do any work upon the property, it shall be possible for a tenant to contend that a term of interdict against Civil Writ Petition No.16455 of 2009 - 9 - effecting repairs through such an unregistered document will be ineffective and that the rights would be governed only by the provisions of the Transfer of Property Act. The right to effect repairs if the landlord neglects to make within a reasonable time and a notice to exercise the tenant's right to carry them out and deduct the same are expressly protected under Section 108-B(f) of the Transfer of Property Act. This illustration is only to bring home the point that a landlord cannot enforce any of the terms of the lease which are essential stipulations in the lease deed; and such stipulations cannot exist do hors the lease. Unlike a user of the property as either residential or non-residential, the particular type of user amongst the non-residential purpose and to provide for a right for eviction if there was a deviation from such user, could not be enforced unless the document is registered. On the first submission, therefore, I hold that the landlord shall not be entitled to complain that the tenant had brought some changes and used the property in one case from a book store to a departmental store and in another case, an additional user of the property for binding of the books had been made, when the lease had been for establishing a Watch shop only. I hold therefore a particular term of the lease providing for a particular purpose only is essential to the lease deed and hence, cannot be enforced by the landlord. (ii) Nature of possession of tenant after termination of lease 8. The learned counsel appearing on behalf of the University relied extensively on the decisions relating to how a tenant at sufferance beyond the term of a lease period could not qualify to obtain a right to hold such possession if the possession is sought to be taken by a process Civil Writ Petition No.16455 of 2009 - 10 - known to law. I reproduce all these decisions only for documenting the arguments advanced by the learned counsel but they must still be seen in the context of a need for examining the fairness in the action for eviction, that will stand for consideration independently as point (iii) below. The learned counsel referred to a judgment in Brigadier K.K.Verma and another Versus Union of India and another-AIR 1954 Bombay 358, where the Hon’ble Supreme Court held that trespasser's possession is never juridical possession and never protected by law. The possession of an erstwhile tenant is, on the other hand, juridical and is protected. The Court held that a tenant of Government premises who continues in possession after the termination of his tenancy by a notice to quit cannot be said to be in 'unauthorized occupation' of the premises within the meaning of Section 3(i)(b) of the Government Premises Act and the notice issued by the Union of India against him was an invalid notice. The Court held that only by means of independent suit for recovery could such a tenant be evicted and an action under the Government Premises Act would not lie. This judgment was cited to point out as to how subsequent to the decision, the law was changed and under the provisions of the Public Premises Act, it is specifically provided that a person, who is inducted in possession of the property under a lease whose lease period has expired, shall be treated as an unauthorized occupant. This change in law through an amendment in the PP Act was noticed and commented in length in M/s Ashoka Marketing Limited and another Versus Punjab National Bank and others-AIR 1991 Supreme Court 855 , a judgment that I will dwell at some length below. Civil Writ Petition No.16455 of 2009 - 11 - A Full Bench of this Court in Roshan alias Roshan Lal and others Versus Secretary, Government of Haryana Development & Panchayat Departmental, Chandigarh and others-AIR 1999 Punjab and Haryana 70, held that a lessee for a fixed period whose lease period has expired could be ejected by taking recourse to the Public Premises Act. To the same proposition is a decision in Punjab State Electricity Board Versus State of Punjab and others-AIR 2003 Punjab and Haryana 80. In that case, it was held that a mere deposit of amount equal to monthly rent during pendency of proceedings before the Collector and the Appellate Authority, would not enable a tenant to contend that his possession is unauthorized. These decisions do not address the question of fairness in action of the landlord as in violation of Article 14 and do not, therefore, help us to resolve the controversy in issue between parties. 9. The learned counsel Shri Anupam Gupta also referred extensively decisions as to change in character of possession of a tenant continuing in possession beyond the expiry of the lease. In M.C.Chockalingam and others Versus V.Manickavasagam and others- AIR 1974 Supreme Court 104, the Hon'ble Supreme Court was dealing with the provisions of Madras Cinemas (Regulation) Rules and the Parent Act of Madras Cinemas Act. In the light of the expression 'lawful possession' used in the Rules for a person to make a claim for obtaining licence for running of a cinema, the Court held that on the expiry of the lease, a lessee cannot be said to continue in lawful possession for the possession is in the capacity as a tenant at sufferance liable to be evicted by the landlord. Such possession could however be held out as sufficient Civil Writ Petition No.16455 of 2009 - 12 - against forcible dispossession protected under Section 6 of the Specific Relief Act but it is not the same thing as characterizing such tenant as being in lawful possession to entitle him to obtain licence from public authorities. In R.V.Bhupal Prasad Versus State of A.P. and others- (1995) 5 Supreme Court Cases 698, the same point was reaffirmed in the context of A.P.Cinema (Regulation) Rules that continuance in possession even after the expiry of the lease period in contravention of terms could not make such possession as lawful possession, the same being at the sufferance of the landlord. If the landlord had not signified his consent for his continuance by accepting rent, the tenant cannot be called as the tenant for holding over. In Raptakos Brett & Company Limited Versus Ganesh Property-(1998) 7 Supreme Court Cases 184, the Hon'ble Supreme Court referring to expressions “wrongful occupation” and “unlawful occupation” as being synonymous and such wrongful occupation was not restricted to occupation and breach of any terms and conditions of the contract. It would cover unlawful occupation after the expiry of lease by efflux of time. If this decision is referred to only for the purpose of showing that the tenants are in unauthorized occupation and hence, liable for ejectment, it carries enormous weight to the landlord but the said decision does not also address the issue of fairness of the action which is a point urged by the tenants in this case. In C. Albert Morris Versus K. Chandrasekaran and others-(2006) 1 Supreme Court Cases 228, the Hon'ble Supreme Court was referring to the consensus of judicial opinion in this country that a mere continuance in occupation of the demised premises after the expiry of the lease, Civil Writ Petition No.16455 of 2009 - 13 - notwithstanding the receipt of an amount by the quondam landlord, would not create a tenancy so as to confer on the erstwhile tenant the status of tenant or a right to be in possession. In Hardesh Ores (P) Limited Versus Hede and Company-(2007) 5 Supreme Court Cases 614, the point was further explained by saying that there would result no automatic renewal of lease by the mere offer of rent by the tenant to the landlord. If the tenancy is invariably a bilateral invocation of a new clause by a party having a right to do, if it is met with denial of renewal by the other party, proper relief to be claimed would only be to get their right to renewal declared and enforce by a Court of law under Section 34 of the Specific Relief Act. The Court also noted a distinction between renewal of a clause in the agreement and extension of existing agreement. The case was considered in the context of a plaintiff seeking for an injunction on the assumed basis that clauses with reference to an agreement stood automatically renewed including the negative covenants and the Court found that the claim was barred by limitation without a prayer for a declaration that the rights subsisted under a renewed agreement. 10. I have outlined all the decisions which go as far as to state that the tenant's possession subsequent to the expiry of the lease is unlawful. They were all set in the context of actions being governed by the provisions of the Transfer of Property Act and when statutory rights under special Rent Restriction Act did not apply to give to them a right to hold possession and liable to be evicted under a normal civil action. If there is a statute which protects the continuance in possession Civil Writ Petition No.16455 of 2009 - 14 - notwithstanding the terms of the lease, the statutory protection which any such legislation would provide would enable them to contend for a status of a statutory tenant and there the consideration of the fact that the lease period had expired or whether the possession is unlawful or unauthorized will have no role to play. However, in cases of public premises to which the provisions of PP Act are applicable, even Rent Control Acts shall not apply. In Ashoka Marketing Limited and another Versus Punjab National Bank and others-AIR 1991 Supreme Court 855, after observing that the nationalized Bank is a Corporation and an instrumentality of State as a corporate body established under the Central Act and it is owned and controlled by the Central Government and consequently, the premises belonging to nationalized Banks are public premises within the meaning of Public Premises Act, held that the provisions of the Public Premises Act overrides the provisions of the Rent Control Act and a person in unauthorized occupation cannot invoke the protection of Rent Control Act. This decision is also an authority for the proposition that in respect of public premises, if an action is taken by a landlord, the claim for protection under any State Rent Control Act will not apply. (iii) Fairness of action for eviction could not be tested without proof of interdict against change of user or actual damage caused to the premises 11. The tenants’ possession is unauthorized