IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA. C. Revision No.208/2008 Reserved on : 6.12.2010 Decided on:4.1.2011. Shiv Charan Dass and others. ...Petitioners. Versus Updesh Sahni. ... Respondent. Coram The Hon’ble Mr. Justice Rajiv Sharma, Judge. Whether approved for reporting?1. yes. For the Petitioner : Mr. Bhupender Gupta, Senior Advocate with Mr. Neeraj Gupta, Advocate. For the Respondents : Mr. K.D. Sood, Advocate. Justice Rajiv Sharma, Judge. This civil revision petition is directed against the judgment dated 30.9.2008 rendered by the learned Appellate Authority, Fast Track Court, Solan in case No. 5 FTC/14 of 2006/2008. 2. Material facts necessary for the adjudication of this petition are that respondent (hereinafter referred to as ‘landlady’ for convenience sake) sought eviction of appellants-tenants (hereinafter referred to as ‘tenants’ for convenience sake) on the grounds that the tenants have failed to pay the rent with effect from 1.4.1998 at the rate of Rs. 2,500/- and have also failed to Whether the reporters of the local papers may be allowed to see the Judgment? . yes. 2 pay statutory increase of rent from August, 1987. The other ground taken by the landlady was that she required the demised premises bona fide for the purpose of building/rebuilding. According to her, the building is 100 years old and she wanted to demolish the old structure in order to construct four storeyed building, as per the building plans sanctioned by the Municipal Committee, Solan and Town and Country Planning Department. She had also averred that she had sufficient funds for reconstruction of the building. 3. The petition was contested by the tenants. Case of the tenants, in a nutshell, is that they have paid rent upto 31.3.1999 and the building was not 100 years old and the same was required bona fide by the landlady for the purpose of building/rebuilding. 4. The Rent Controller framed issues on 12.12.2002/1.6.2006. The Rent Controller held the tenants to be in arrears of Rs. 2,500/- per month with effect from 1.4.1999 till date which comes to Rs. 18,722/-. However, the Rent Controller held that tenants be not evicted in case they pay the arrears of rent with effect from 1.4.1999 alongwith interest @ 9% per annum. The petition was dismissed on the ground of bona fide requirement for the purpose of building/rebuilding. Landlady preferred an appeal before the Appellate Authority, Fast Track Court, Solan. The Appellate Authority allowed the appeal and ordered the eviction on the ground of arrears of rent, which 3 worked out to be Rs. 29,807/- alongwith interest @ 9% per annum and the eviction was also ordered on the ground that the landlady required the premises bona fide for the purpose of building/rebuilding. Hence, the present revision petition against the judgment dated 30.9.2008.9.2006. 5. Mr. Bhupender Gupta, Senior Advocate has strenuously argued that the landlady has failed to prove that she required the premises bona fide for reconstruction/rebuilding. According to him, the Appellate Authority has not recorded any findings that the reconstruction/rebuilding was not possible without vacation of the premises by the tenant. He further argued that finding recorded by the Appellate Authority with regard to arrears of rent was not based on correct appreciation of evidence. 6. Mr. K.D. Sood has supported the judgment of the Appellate Authority. 7. I have heard the learned counsel for the parties and have perused the record carefully. 8. PW-1 Inder Pal Sahni is the holder of General Power of Attorney of the landlady. According to him, the demised premises were 100 years old. Front portion of the building is covered by CGI sheets. According to him, roof and walls have also damaged. He then stated that whenever it rains, water comes into the shops. The retaining wall had swollen. He got the building inspected from an Engineer and the building cannot be 4 reconstructed without getting the same vacated and the plans for reconstruction already stand sanctioned from the Municipal Committee, Solan and Town and Country Planning Department. PW-1 is husband of landlady. He has also proved that the landlady has sufficient funds for reconstruction of the building. 9. PW-2 R.B. Saxena examined the shop in question. He has proved plan Ex.PW-2/A and map Ex.PW-2/B. According to him, the building was 100 years old and CGI sheets were damaged and the water was leaking and to avoid leakage, tarpaulin had been placed on the roof. According to him, the condition of the slab was also bad. 10. PW-3 Krishan Dutt has proved the copy of building plan Ex.PW-3/A and sanctioned letter Ex.PW-3/B. 11. PW-4 V.S. Bhandari has proved that the landlady had account with the Bank and there are fixed deposits also. According to him, the Oriental Bank of Commerce was ready and willing to provide loan for the reconstruction of the building. 12. PW-5 Madan Lal has supported the version of PW-1. According to him, the building was 100 years old and was in a dilapidated condition and there was seepage from the back wall. He has also undertaken to render financial assistance to the landlady. 13. Shiv Charan, one of the tenants, has appeared as RW-1. According to him, the building was only 50 years old. He 5 stated that the landlady could raise the construction above the shop. He has relied upon report Ex.R-1. 14. RW-2 is Vivek Karol. He has admitted that in case the building is to be raised then underground pillars are to be raised. He has also admitted that if the construction has to be raised, pits 5’x 5’ are required to be raised. These pits can only be laid from the ground. 15. PW-7 is Ravinder Singh Negi. He has proved that the landlady has applied to loan and proved the documents Ex.PW-7/A, FDRs Ex.PW-6/B, Ex.PW-6/C, Ex.PW-6/D, Ex.PW-6/E, Ex.PW-6/F, Ex.PW-6/G, Ex.PW-6/H, PW-6/J, PW-6/K, PW-6/L and Ex.PW-6/M. 16. 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, 6 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 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 7 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 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 8 the benign legislation enacted with the avowed intention of giving protection to the tenant.” 17. 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 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 9 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.” 18. 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.” 19. 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 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.” 10 20. 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: 11 “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 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.” 21. Their Lordships of the Hon’ble Supreme Court in Vijay Singh and others versus Vijayalakshmi Ammal, 12 (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 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 tenants; (2) the age and condition of the building; (3) the financial position of the landlord to demolish and erect a new building according to the statutory requirements of the Act. These are some of the illustrative factors which have to be taken into consideration before an order is passed under Section 14(1)(b). NO court can fix any limit in respect of the age and condition of the building. That factor has to be taken into consideration along with other factors and then a conclusion one way or the other has to be arrived at by the Rent Controller.” 22. The principle laid down in Vijay Singh and others versus Vijayalakshmi Ammal, (1996) 6 SCC 475 were explained and reiterated in Amaiyappa Transport versus N.S. Rajulu, (2002) 9 SCC 437 as well. 23. In R.V.E. Venkatachala Gounder versus Venkatesha Gupta and others, (2002) 4 SCC 437 their Lordships of the Hon’ble Supreme Court have laid down the following parameters under section 14 (1) (b) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960: “11. We may refer to two decisions of Madras High Court. In S.Raju and others Vs. K. Nathamani, 1998 (3) LW 214, the 13 Constitution Bench decision has been followed and it has been held that when new buildings with modern amenities have come up in that locality, naturally the building in question may become unsuitable to the surroundings and a liability, in its present condition, to the landlord. Keeping the building in the same condition will amount to asking the landlord to shoulder the burden for ever. Tenants may be satisfied with the present state of the building since they have to pay only a nominal rent but the Rent Control Legislation, beneficial to the landlord and the tenant both, should be interpreted in that way. For the purpose of proving his bona fides the landlord need only show that he has got the capacity to raise the necessary funds. In A.N. Srinivasa Thevar Vs. Sundarambal alias Prema W/o. Chandrakumar, 1995 (2) LW 14, even before the decision by Constitution Bench in Vijay Singh's case was available, it was held in the light of the decision in P. Orr & Sons that the availability of the following factors was sufficient to make out a case of bona fide requirement under Section 14(1)(b): "(a) Capacity of the landlord to demolish and to reconstruct is undisputed and also proved satisfactorily; (b) The size of the existing building occupies only one third of the site, leaving two third behind vacant and unutilized; (c) Demand for additional space: The demised premises is situated in a busy locality. Therefore, there is a great demand for additional space in the locality which could be met by demolishing the existing small building and putting up a larger building providing for future development vertically also, by building pucca terraced building; (d) The economic advantage: A modern construction of a larger building shall certainly yield better revenue and also appreciate in value, when compared to the asbestos sheet roofed old building." In that case, it was observed that the existing building was an old, out-model asbestos sheet building proposed to be replaced with better and modern building which would provide for better quality accommodation to the needs of the present days as the preservation of such building in a busy 14 locality of a town shall not only be an eyesore but also against the souring public demand for additional space. Viewed from the angle of general interest of the public which, according to the decision in P. Orr & Sons is one of the considerations, it was observed that a big site should yield to a larger modern building with an increased and enlarged accommodation having better facilities to solve the ever increasing demand for more space. Stalling growth and development for the sake of one tenant who is in occupation of an old model building constructed with mud and mortar and asbestos sheets occupying only one third of the site was held to be not conducive to public interest. We approve the statement of law and the approach adopted by Madras High Court in both the above said decisions. The structural and physical features and the nature of the construction of the building cannot be ignored. Even in P. Orr & Sons, this Court was of opinion that various circumstances, such as the capacity of the landlord, 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 authorities, while considering the requirement for reconstruction of the building as the essential and overriding consideration in the general interest of the public and for the protection of the tenant from unreasonable eviction.” 24. Their Lordships of the Hon’ble Supreme Court in Jagat pal Dhawan versus Kahan Singh (dead) by LRs and others, (2003) 1 SCC 191 had the occasion to interpret clause (c) of sub