IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA. C. Revision No. 133/2008 Reserved on : 30.6.2010 Decided on: 30.7. 2010. Som Nath. ...Petitioner. Versus Sunil Kumar. ... Respondent. Coram The Hon’ble Mr. Justice Rajiv Sharma, Judge. Whether approved for reporting?1 Yes. For the Petitioner : Mr. Ajay Kumar, Advocate. For the Respondent : Mr. G.D. Verma, Sr. Advocate with Mr. Romesh Verma, Advocate. Justice Rajiv Sharma, Judge. This is a tenant’s revision petition under section 24 (5) of the Himachal Pradesh Urban Rent Control Act, 1987 against the order dated 31.5.2008 passed by learned Appellate Authority, Shimla in Civil Misc. Appeal No. 44-S/14/2007 whereby the Appellate Authority has dismissed the appeal of the petitioner-tenant (hereinafter referred to as ‘the tenant’ for convenience sake) by upholding the order dated 2.6.2007 passed by Rent Controller No.3, Shimla in rent case No. 33/2 of 2006. Material facts necessary for the adjudication of this petition are that the respondent-landlord (hereinafter referred to as ‘the landlord’ for convenience sake) filed the rent application under section 14 of the Whether the reporters of the local papers may be allowed to see the Judgment? Yes. 2 Himachal Pradesh Urban Rent Control Act, 1987 (hereinafter referred to as ‘the Act’ for convenience sake) against the tenant. His case, in a nutshell, before the Rent Controller, was that he is the owner of Shop No. 88, Lower Bazar, Shimla. The building is three storeyed. Som Nath was inducted as a tenant in the ground floor in respect of the shop by previous owner of the building for doing work of tailoring. He was carrying tailoring in shop for the last 35 years. The rent payable was Rs. 84/- per month inclusive of the taxes. The landlord has purchased the building from Sh. Puran Chand etc., previous owners, vide registered sale deed dated 15.5.1998 and thereafter tenant started paying rent to the landlord. He has changed use and occupation by closing the work of tailoring and has converted his business by way of sale of articles of daily needs in the shop. The landlord sought eviction of tenant on the ground that shop No. 88, in occupation of tenant, is bonafidely required by him for the purpose of building and rebuilding. According to him, the entire building is in dilapidated condition. It was constructed more than 100 years back and the building has outlived its life. He intended to demolish entire existing structure to rebuild the same in RCC structure. The rebuilding work has to be carried out from the foundation so that the entire structure is construed in RCC. The rebuilding cannot be carried out without the entire building is vacated. The shop in question is on the ground floor and two storeys of the building are in possession of the landlord. The landlord has sufficient funds in his account. The landlord has no other premises to carry his business in order to earn livelihood except the present shop in question. The application was resisted by the tenant being not maintainable. On merits, it was contended that the shop in question was in good condition and the landlord has already converted Dhajji walls into RCC structure, therefore, he is misleading the Court by narrating wrong facts. 3 According to him, the landlord was running a shop adjoining to his shop, which is known as “Krishana Mishthan Bhandar”. The trial court formulated the following issues on 13.10.2006: 1. “Whether the building in occupation is bonafidely required by the petitioner for the purpose of building or rebuilding, as alleged? OPP. 2. Whether the demised premises is in dilapidated condition and was constructed more than 100 years back and has outlived its life, as alleged? OPP. 3. Whether the work of the building and rebuilding of this building cannot be carried without entire building is vacated, as alleged? OPP. 4. Whether the applicant has no other premises to carry his business and earn his livelihood except the present shop in question, as alleged? OPP. 5. Whether the respondent has not impaired the value and utility of the building, as alleged? OPR 6. Whether the petition is not maintainable in the present form? OPR 7. Relief.” The Rent Controller allowed the application preferred by the landlord on 2.6.2007. The tenant feeling aggrieved by the order dated 2.6.2007 preferred an appeal before the Appellate Authority vide Rent Appeal No. 44-S/14 of 2007. The Appellate Authority dismissed the appeal on 31.5.2008. Hence, the present petition by the tenant. Mr. Ajay Kumar has strenuously argued that the orders passed by both the courts below are not in accordance with law. He then contended that the Appellate Authority has erred in law by dismissing the applications preferred by the tenant under order 39 rule 7 read with sections 94 and 151 as well as under order 41 rule 27 of the Code of Civil Procedure. He lastly contended that the building was not in a dilapidated condition and the landlord has not made out any grounds for rebuilding of the premises in question. 4 Mr. G.D. Verma has supported the orders passed by both the courts below. He then contended that the applications under order 39 rule 7 read with sections 94 and 151 as well as under order 41 rule 27 of the Code of Civil Procedure has rightly been rejected by the Appellate Authority. I have heard the learned counsel for the parties and have perused the pleadings carefully. PW-1 is Bhavesh Chaturvedi. He was posted Junior Engineer, Municipal Corporation, Shimla. He had brought the summoned records and deposed that the landlord has submitted map before the Municipal Corporation and the same was under consideration. PW-2 is Prakash Thakur, Deputy Manager, Punjab National Bank. He had brought the record and proved Ex.PW-2/A, i.e. statement of account relating to the landlord and his wife Smt. Rajni Aggarwal. He deposed that more than Rs. Seven lakhs are lying deposited in the joint account of the landlord and his wife as on 5.12.2006. PW-3 is Saran Dass. He is retired Executive Engineer from the Himachal Pradesh Public Works Department. He deposed that he inspected the disputed building and gave report Ex.PW-3/A. He has also prepared map Ex.PW-3/B as well as proved the photographs and the negatives Ex.PW-A-1 to A-22 (later on exhibited as Ex.PW-4/A-1 to A-22). The landlord has appeared as PW-4. He testified that he is owner of the three storeyed building situated in the Lower Bazar Market, Shimla. The building was bought by him from its previous owners. The shop on the ground floor is in possession of the tenant. The first floor and top floor are in his occupation. The rent payable is Rs. 900/- per annum. The building is 100 years old. The walls are Dhajji made of Surkhi Chuna. The condition of the building is not 5 good. The wooden floorings etc. are rotten and as there was seepage, he was forced to lay the cement flooring. The walls have developed cracks and the building is not fit for human habitation. It is in these circumstances he has kept his first floor vacant. He had requested the tenant to vacate the disputed shop as he intended to reconstruct the entire building. He had put two iron girders to ensure that the building does not give way. He also deposed that the rebuilding/reconstruction work cannot be carried out without the suit shop being vacated. He further deposed that the walls of the building are two feet wide and in case of reconstruction, the same will be erected with the help of bricks and after the completion of the building, the value of the building will increase. He has also referred to report Ex.PW-3/A and map Ex. PW-3/B prepared by Sh. S.S. Dass. According to him, as per the report of the expert, the building has completed its life and needs reconstruction. He has also proved photographs Ex.PW-4/A-1 to A-11. He was cross-examined by the tenant. In his cross-examination, he testified that he has purchased the building in the year 1998 and he has changed floor of the first storey and thereafter put the girders and RCC flooring was laid by him. He also admitted that cement plaster has been done on the outer walls. Tenant has appeared as RW-1. He has deposed that the condition of the building was good and the walls of both the sides are two feet wide each and made of the stones. He has admitted that reconstruction of the building cannot be carried out without being vacated. He denied that the building has out lived its life and utility. RW-2 Inder Mohan has supported the version of RW-1. What emerges from the oral as well as documentary evidence led by the parties is that the building in question is old and in dilapidated condition. The walls are made of Dhajji and the wooden flooring is 6 rotten. The landlord has given support to the building with girders. It is evident from report Ex.PW-3/A that the building is old and requires reconstruction. The landlord has sufficient funds as per the statement of PW-2 Prakash Thakur, Deputy Manager, Punjab National Bank. Landlord has also submitted the building plan for reconstruction before the Municipal Corporation, Shimla. Tenant has not produced any tangible evidence to establish that the building is not in dilapidated condition and has not out lived its life and utility. The building is situated in commercial area and if the same is reconstructed it will improve its market value. Mr. Ajay Kumar has vehemently argued that the Appellate Authority has erred in law by dismissing application under order 39 rule 7 read with section 94 and 151 of the Code of Civil Procedure whereby Sh. H.S. Bisht, expert/Engineer has not been allowed an access to the first and second floors of building No.88, Lower Bazar, Shimla and to take photographs inside the building. The tenant has also moved application under order 41 rule 27 of the Code of Civil Procedure to establish that the landlord has already obtained structural stability certificate of the building and has also shown in affidavit that the building was fit for installation of BSNL pole on the roof/top of its building. According to him, deed of indemnity was also executed on 23.5.2007 by Bharat Sanchar Nigam Limited with Municipal Corporation, Shimla. The purpose of application preferred under order 39 rule 7 and order 41 rule 27 of the Code of Civil Procedure was to establish that the building is refurbished and is not required to be reconstructed. The requirement of law as per section 14 (3) (c) of the Himachal Pradesh Urban Rent Control Act, 1987 is that the rented land is required bonafide by the landlord for the purpose of building or re- 7 building or addition or alteration cannot be carried out without the building or rented land being vacated. Their Lordships of the Hon’ble Supreme Court in Metalware and Company etc. versus Bansilal Sarma and Company etc. (1979) 3 SCC 398 while interpreting section 14 (1) (b) of the Tamil Nadu Buildings (Lease and Rent Control Act , 1960 have held that the Rent Controller is required to take into account all the surrounding circumstances including not merely the factors of the landlord being possessed of sufficient means or funds to undertake the project and steps taken by him in that regard but also the existing condition of the building, its age and situation and possibility or otherwise of its being put to a more profitable use after reconstruction. Their Lordships have further held that if the building happens to be decrepit or dilapidated it will readily make the bona fide requirement of the landlord, though that by itself in the absence of any means being possessed by the landlord would not be sufficient. Their Lordships have held as under: “6. As stated earlier it cannot be disputed that the phrase used in S. 14 (1) (b) of the Act is 'the building is bona fide required by the landlord' for the immediate purpose of demolition and reconstruction and the same clearly refers to the bona fide requirement of the landlord it is also true that the requirement in terms is not that the building should need immediate demolition and reconstruction. But we fail to appreciate how the state or condition of the building and the extent to which it could stand without immediate demolition and reconstruction in future would be a totally irrelevant factor while determining "the bona fide requirement of the landlord". If the Rent Controller has to be satisfied about the bona fide requirement of the landlord which must mean genuineness of his claim in that behalf the Rent Controller will have to take into account all the surrounding circumstances including not merely the factors of the landlord being possessed of sufficient means or funds to under take the project and steps taken by him in that regard but also the existing condition of the building, its age and situation and possibility or otherwise of its being put to a 8 more profitable use after reconstruction. All these factors being relevant must enter the verdict of the Rent Controller on the question of the bona fide requirement of the landlord under S. 14 (1) (b). In a sense if the building happens to be decrepit or dilapidated it will readily make for the bona fide requirement of the landlord, though that by itself in the absence of any means being possessed by the landlord would not be sufficient. Conversely a landlord being possessed of sufficient means to under take the project of demolition and reconstruction by itself may not be sufficient to establish his bona fide requirement if the building happens to be a very recent construction in a perfectly sound condition and its situation may prevent its being put to a more profitable use after reconstruction. In any case these latter factors may cast a serious doubt on the landlord's bona fide requirement. It is, therefore, clear to us that the age and condition of the building would certainly be a relevant factor which will have to be taken into account while pronouncing upon the bona fide requirement of the landlord under S. 14 (1) (b) of the Act and the same cannot be ignored. 7. We would like to observe that each side has adopted an extreme stand on the question at issue which is obviously incorrect. On the one hand counsel for the appellant urged that the words 'bona fide required' refer to the condition of the building and not to the honest or bona fide intention entertained by the landlord to undertake demolition and reconstruction, suggesting thereby that the condition of the building should be a decisive factor while counsel for the respondent on the other hand contended that that aspect was totally irrelevant and the bona fide requirement of the landlord should be determined on the basis of factors such as the financial capacity of the landlord to undertake the project and whether he had taken any steps in that behalf etc. We do not agree that old age and dilapidated condition of the building is a sine qua non or a decisive factor for eviction under S. 14 (1) (b) nor is it possible to accept the view that the said circumstances in totally irrelevant in pronouncing upon the bona fide requirement of the landlord. We are clearly of the view that the age and 9 existing condition of the building - whether it is a recent construction or very old and whether it is in a good and sound condition or has become decrepit or dilapidated - are relevant factors forming part of 'all the circumstances' that having to be considered while determining the bona fide requirement of the landlord under S. 14 (1) (b) of the Act and in the totality of the circumstances these factors may assume lesser or greater significance depending upon whether in the scheme of the concerned enactment there is or there is not a provision for reinduction of the evicted tenant into the new construction. Such a view would be in accord with the main objective of the benign legislation enacted with the avowed intention of giving protection to the tenant.” In P.ORR and sons (P) Limited versus Associated Publishers (Madras) Limited, (1991) 1 SCC 301, their Lordships of the Hon’ble Supreme Court have held that the Tamil Nadu Buildings (Lease and Rent Control Act, 1960 does not accept the requirement by the landlord as a bona fide requirement within the meaning of the provision unless the condition of the building, in the context of the relevant circumstances, requires demolition. Their Lordships have held as under: “30. We accordingly hold that S. 14(l)(b) is satisfied only if the building is bona fide required by the landlord for the "immediate", i.e., direct, sole and timely purpose of demolishing it with a view to erecting a new building on the site of the existing building. Various circumstances such as the capacity of the landlord, the size of the existing building, the demand for additional space, the condition of the place, the economic advantage and other factors justifying investment of capital on reconstruction may be taken into account by the concerned authority in considering an application for recovery; but the essential and overriding consideration which, in the general interests of the public and for the protection of the 10 tenants from unreasonable eviction, the legislature has in mind is the condition of the building that demands timely demolition by reason of the extent of damage to its structure making it uneconomical or unsafe to undertake repairs. While the condition of the building by itself may not necessarily establish the bona fide requirement under clause (b), that condition is not only one of the various circumstances which may be taken into account by the Controller, but it is the essential condition in the absence of which it would not be possible for the land-lord to prove that he has a bona fide requirement which is timely, directly and solely for the purpose of demolition of the building. The Act does not accept the requirement by the landlord as a bona fide requirement within the meaning of the provision unless the condition of the building, in the context of the relevant circumstances, requires demolition. These are matters which are to be proved by evidence.” It will be apt at this stage to refer to section 14 (b) of the Tamil Nadu Buildings (Lease and Rent Control Act , 1960, which reads thus: “14 (b)- that the building is bona fide required by the landlord for the immediate purpose of demolishing it and such demolition is to be made for the purpose of erecting a new building on the site of the building sought to be demolished.” Section 14 (b) of the Tamil Nadu Buildings (Lease and Rent Control Act , 1960 is not pari materia with section 14 (3) (c) of the Himachal Pradesh Urban Rent Control Act, 1987. Section 14 (3) (c) of the Himachal Pradesh Urban Rent Control Act, 1987 reads thus: “14 (3) (c)- in the case of any building or rented land, if he requires it to carry out any building work at the instance or the Government or local authority or any Improvement Trust under some improvement or development scheme or if it has become unsafe or unfit for human habitation or is required bonafide by him for carrying out repairs which can not be carried out without the building or rented land being vacated or that the building or rented land is required bonafide by him for the purpose of 11 building or re-building or making these to any substantial additions, or alterations and that such building or re-building or addition or alteration can not be carried out without the building or rented land being vacated.” Their Lordships of the Hon’ble Supreme Court in Shyamlal Agarwal versus Ratanlal Malviya (dead) by LRs, 1991 Supp. (2) SCC 449 had the occasion to construe section 12 (1) (h) of M.P. Accommodation Control Act, 1961. Section 12 (1) (h) of the Act permits eviction of tenant from any accommodation on the ground that the accommodation is required bona fide by the landlord for the purpose of building or rebuilding or making therein any substantial addition or alteration. The language employed in section 12 (1) (h) of the M.P. Accommodation Control Act, 1961 is more akin to the phraseology employed in section 14 (3) (c) of the Himachal Pradesh Urban Rent Control Act, 1987. Their Lordships after interpreting section 12 (1) (h) have held that the building should be in a dilapidated condition requiring repair or demolition was not a statutory requirement. Their Lordships have further held that there is no statutory requirement that while considering the bona fide need of the landlord for reconstruction of the accommodation the building must necessarily be in a dilapidated condition requiring repair without demolition. However, their Lordships have held that even in the absence of such a provision dilapidated or otherwise, condition of the building would be one of the relevant circumstance while considering the bona fide of the landlord under section 12 (1) (h) of the Act although that could not be a decisive circumstance in determining the question of bona fide need. Their Lordships have held as under: “3. Learned counsel for the appellant urged that the High Court has failed to record any finding that the shop in dispute was in dilapidated condition or that, it required reconstruction, in the absence of such a finding the landlord' & bona fide need could 12 not be upheld. He placed reliance on a number of decisions but since none of them relate to interpretation of S. 12(1)(h) of the Madhya Pradesh Accommodation Control Act, 1961, it is not necessary to refer to those decisions. S. 12(1)(h) of the Act permits eviction of tenant from any accommodation on the- ground that the accommodation is required bona fide by the landlord for there purpose of building or rebuilding or making therein any substantial, addition or alteration. There is no statutory requirement that while, considering the bona fide need of the land-lord for reconstruction of the accommodation the building must necessarily be in a dilapidated condition requiring repair. or demolition. Unlike other Rent Control Laws the Madhya Pradesh Accommodation Act does not expressly provide for any such condition. But even in the absence of such a provision dilapidated or otherwise, condition of the building would be one of the relevant circumstance while considering the bona fide need of the landlord under S. 12(1)(h) of the Act, although that could not be a decisive circumstance in determining the question of bona fide need. Bona fide requirement of the landlord under S. 12(1)(h) may include many relevant factors i.e. the need of the landlord to put the building for better use to obtain higher income, the condition of the building, shortage of accommodation and necessity of having larger accommodation. the capacity of the landlord to rebuild the accommodation, his financial resources etc. All these factors are relevant for the purposes of determining tile question whether the accommodation is required bona fide by the landlord for the purpose of rebuilding the accommodation.” Their Lordships of the Hon’ble Supreme Court in Vijay Singh and others versus Vijayalakshmi Ammal, (1996) 6 SCC 475 had again the occasion to consider section 14 (1) (b) of the Tamil Nadu Rent Control Act. Their Lordships have culled out the following principles: “For granting permission under Section 14(1)(b) the Rent Controller is expected to consider all relevant materials for recording a finding whether the requirement of the landlord for demolition of the building and erection of a new building on the same site is bonafide or not. For recording a finding 13 that requirement for demolition was bonafide, the Rent Controller has to take into account: (1) bonafide intention of the landlord for from the sole object only to get rid of the