CR No.103 of 2011 (O&M) - 1 - ****** IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CR No.103 of 2011 (O&M) Date of decision:04.07.2011. Amrik Singh and another ...Petitioners Versus R.R.Gulati and others ...Respondents CORAM: HON’BLE MR. JUSTICE RAKESH KUMAR JAIN Present: Mr. Kanwaljit Singh, Senior Advocate, with Ms. Guneet, Advocate, for the petitioners. Mr. Ashok Aggarwal, Senior Advocate, with Mr. Deepak Suri and Mr. Mukul Aggarwal, Advocate, ***** Rakesh Kumar Jain, J. The tenants are in revision against orders of the learned Courts below by which they have been asked to vacate the demised premises on the ground of personal necessity of the landlords. The brief facts of the case are that the landlords filed a petition under Section 13 of the East Punjab Urban Rent Restriction Act, 1949 [for short “the Act”] against the tenants in respect of the demised premises, i.e. 3rd Floor of SCO No.10, Sector 17-E, Chandigarh, inter alia, on the ground of personal necessity. The case set up by the landlords is that the demised premises was let out to one Harnek Singh who has been succeeded by his three sons (tenants herein). The landlords purchased the demised premises and became entitled to receive rent from the tenants w.e.f. 01.03.2000. The landlords are running their business in the same building under the name and style of M/s Empire Stores since 1964 which is being expanded from time to time as per the family requirement. The precise pleadings in respect of personal necessity are contained in para Nos.9, 10 & 11 of the eviction petition which are reproduced CR No.103 of 2011 (O&M) - 2 - ****** as under: - “9. That as the family of Sh. R.R.Gulati is having members, who are active in the business and more members are going to be added in the business, therefore, it has been decided to expand the business of M/s Empire Store in SCO No.10, Sector 17-E, Chandigarh. Recently, Mr. Ajay Gulati has completed his M.B.A. who is son of Sh. Jai Gulati and he will be joining the business of Empire Stores to be run in the entire SCO. Another son Aman of Sh. Jai Gulati is also coming back from America in April, 2001 after completing his higher studies to join the business of M/s Empire Stores in the SCO in question. It has been decided that M/s Empire Store will be running a complete Departmental Store in the entire SCO No.10, Sector 17-E, Chandigargh. Therefore, the petitioners requested all the tenants of the building to vacate their respective portions. The same request was also made to the respondents but they have not taken any notice of the same. It is also important to mention that the respondents are also occupying SCO No.15, Sector 17-E, Chandigarh, in which the business of tailoring is being run and the premises in question are being used for the purpose of workshop and residence of the workers, which is also against the bye-laws made by the Chandigarh Administration under the Capital of Punjab (Development and Regulation) Act, 1952. On account of this violation, the building in question can be resumed by the Estate Officer at any moment. 10. That under these circumstances, the entire SCO in question is required by the petitioners for the business of M/s Empire Stores as the space in their CR No.103 of 2011 (O&M) - 3 - ****** possession is insufficient to run the business of M/s Empire Stores properly. The accommodation in the said SCO is also suitable for the business of M/s Empire Stores, therefore, the petitioners require the entire SCO for their personal use and occupation and the respondents are liable to be evicted on the ground of personal requirement. 11. That the petitioners do not own or possess any other commercial property except mentioned above and the petitioners have neither occupied nor vacated any other commercial property within the urban area of Chandigarh, after the commencement of the Act, without any sufficient cause.” Besides the above, the landlords also disclosed the properties owned by the family of R.R.Gulati in different names in Chandigarh and beyond it, which are reproduced as under: - “a) SCO No.10, Sector 17-E, Chandigarh is owned by Sh. R.R.Gulati, Subhash Gulati, Jai Gulati, Amit Gulati and Anil Gulati. b) SCO No.22/23, Sector 9-D, Chandigarh, is owned by M/s Leela Health Care and Research Hospital Limited with other 13 co-owners. c) Industrial Plot No.58, Industrial Area, Phase-II, Chandigarh is owned by M/s Empire Stores, in which manufacturing activity is being done. d) Industrial Plot No.88, Industrial Area, Phase-II, Chandigarh, is owned by M/s Leela Confectionery Pvt. Ltd. e) Industrial Plot No.402 was owned by Sh. Anil Gulati and the same has been sold a month's back. f) Land measuring 12-1/2 acre out of which 3 CR No.103 of 2011 (O&M) - 4 - ****** acres are being used for running factory by M/s Empire Packages Limited. g) 2 Kanal plot in village Kishangarh, U.T., Chandigarh for Gas Godown owned by Sh. R.R.Gulati. h) Rented accommodation consisting of back side portion of SCO No.36, Sector 26, Madhya Marg, Chandigarh used by M/s Empire Stores for its godown and the office of the Gas Agency known as M/s Shivalik Agencies.” It was further alleged that M/s Empire Stores is a partnership concern comprising of the landlords as its partners. M/s Shivalik Agencies is running a Gas Agency through its partners Sh. Subhash Gulati, Jai Gulati, Anil Gulati and Amit Gulati. M/s Empire Packages Limited is running its business in Plot No.58, Industrial Area, Phase-II, Chandigarh as well as in the land situated at Derabassi. M/s Leela Confectionery Pvt. Ltd. is being controlled by Sandeep Gulati and its business is being run in Plot No.88, Industrial Area, Phase-II, Chandigarh. Amit Gulati is the Director of Shree Ganesh Textile Mills Limited and its business is being run in the portion of SCO No.22/23, Sector 9-D, Chandigarh. In reply to para Nos.9, 10 & 11 of the eviction petition, following averments have been made by the tenants: - “9. That para 9 of the petition is totally wrong and denied. It is not disclosed as to when the petitioners have decided to expand the business of Empire Store and why Ajay Gulati will join the business of Empire Store and not other business. This has all been projected to file the present petition. Aman son of Jaya Gulati is also not going to join Empire Store nor is likely to return, as alleged, after completing his higher studies to join the business of Empire Store in the building in question. M/s. Empire Store is already CR No.103 of 2011 (O&M) - 5 - ****** occupying much more space than the space occupied by the Departmental Store in Chandigarh. The desire to occupy more space is actuated with mala fide view to evict the respondents and other tenants who are paying nominal rent. In fact, no request was made to the respondents and other tenants to vacate the premises and the allegations to this effect are false. It is also admitted to be correct that the respondents are also occupying half portion of the first floor of SCO No.15, Sector 17-E, Chandigarh in which business of tailoring is being run. The premises in question are being used for the purposes of workshop for the tailoring business. It is wrong and denied that the premises in question is being used for the residence of the workers of the respondents. The premises in question has never been used for the purposes of residence of the workers and, therefore, the question of the violation of bye-laws of Chandigarh Administration and Capital of Punjab (Development & Regulations) Act does not arise. There is no question of resumption on this account. 10. That para 10 of the petition is totally wrong and denied. The second floor and third floor which cannot be used for trading are not required for the Empire Store. The requirement is mala fide. In fact the requirement is imaginary and false. Had the requirement been genuine then the petitioners would have occupied SCO No.22-23, Sector 9-D, Chandigarh or would not have purchased the tenanted premises. 11. That para 11 of the petition is totally wrong and denied. The detailed averments have been made CR No.103 of 2011 (O&M) - 6 - ****** above.” With regard to the averments made in para No.7 of the eviction petition, the tenants made the following averments in their reply: - “7. That para 7 of the petition as laid down is not admitted and thus denied. It is however, relevant to submit and state that building at Sr. No.1 has been acquired by the petitioners in the month of March, 2000. They were fully aware about the tenants occupying different portions. The petitioners have opted to buy the tenanted premises as they were fully aware that they are not in urgent need of space for Empire Store. The building at Sr. No.B i.e. SCO No.22-23, Sector 9-D, Chandigarh was acquired after the enforcement of the Rent Restriction Act. It is a commercial premises located in the commercial centre but the petitioners let out the entire building to the various tenants. The ground floor of the said building has been let out to M/s. G. Travels and M/s Seasons Boutique Private Limited. The basement, first floor and second floors have been let out to various tenants. The portion in the said building keeps falling vacant and are re-let. This clearly shows that the petitioners have vacated the non- residential premises in the urban area of Chandigarh after the enforcement of the Rent Restriction Act. In respect of building at Sr. No.C i.e. Plot No.58, Industrial Area, the half portion of the said industrial shed is being used by Empire Packaging and the remaining half portion has been let out to M/s. Elco Breweries Limited. This also indicate that the petitioners have rented out the non-residential premises in the urban area of Chandigarh after the CR No.103 of 2011 (O&M) - 7 - ****** enforcement of the Rent Restriction Act. In respect of building at Sr. No.D it is submitted that the said shed has been let out to M/s. Ravalgon Limited, a company manufacturing sweets. As regards property at Sr. No.E, the respondent submit and state that the said shed was purchased by Shri Anil Gulati from CITCO at nominal price and sold the same at huge profits which clearly speaks that the petitioners were not in the need of non-residential premises. It is further submitted that the said industrial plot No.402, has been sold in an illegal manner without obtaining the permission from CITCO with a solitary motive to make money. As regards property at Sr. No.F, the respondent submit and state that a part of the land is being used for Empire Packaging Limited and huge area is available for development and occupation by the petitioners. As regards property at Sr. No.G, it is submitted that the petitioners are using the said two kanal plot as a godown for Gas Agency. Lot of area is still lying vacant and has not been used by the petitioners. In respect of building at Sr No.H , the respondent submit and state that some portion of SCO No.36, Madhya Marg, Sector 26, Chandigarh had been hired by the petitioners for use of Gas Agency and a Gas Agency is being run in the said premises.” It was alleged that the tenants are not aware about the partnership of M/s Empire Stores and that of M/s Shivalik Agencies. As regards M/s. Empire Packages Limited, it is submitted that part of the Industrial Shed No.58 has been used by the said company and a part of the same has been let out to M/s. Elco Breweries Limited. It was admitted that M/s Empire Packages Limited is carrying on its business in Derabassi. It was denied that M/s Leela Confectionary Limited is being controlled by Sandeep Gulati and its business is CR No.103 of 2011 (O&M) - 8 - ****** being run in Industrial Plot No.58, Phase-II, Chandigarh. It was alleged that M/s. Ravalgon Limited is manufacturing confectionary in the said shed. It was also denied that Amit Gulati is the Director of M/s. Ganesh Textile Mills and is running the business of the said company in the SCO No.22-23, Sector 9-D, Chandigarh. The landlords filed replication to the written statement and the averments made therein were denied and that of the eviction petition were reiterated. Finally, on the pleadings of the parties, the learned Rent Controller framed the following issues: - “1. Whether demised premises is required by the petitioners for their own use and occupation?OPP. 2. Whether the tender made by the respondent is legal and valid?OPR. 3. Whether the petitioners have not come to the Court with clean hands?OPR. 4. Relief.” The landlords, in order to prove their case, examined Jai Gulati (PW1) and Piare Lal (PW2), whereas the tenants examined Nirmal Singh (RW1). The learned Rent Controller decided issue No.2 against the landlords with regard to the tender of arrears of rent, but decided issue Nos.1 and 3 in their favour and allowed the eviction petition vide its order dated 05.10.2009 which has been maintained by the learned Appellate Authority, Chandigarh vide its order dated 30.10.2010. Aggrieved against orders of the learned Courts below, the tenants have filed this revision petition in which record was also summoned by this Court. Learned counsel for the tenants has argued that as per the averments made in para No.9 of the eviction petition, the landlords sought eviction of the tenants for the personal necessity of the sons of Jai Gulati, namely, Ajay Gulati and Aman Gulati without uttering a word that they do not occupy any other commercial property in the urban area of Chandigarh nor had CR No.103 of 2011 (O&M) - 9 - ****** vacated any commercial property without any sufficient cause after the commencement of the Act. He further submitted that aforesaid two sons of Jai Gulati did not even enter the witness box to depose about their personal necessity. In this regard, reliance has been placed upon a decision of the Supreme Court in the case of Ajit Singh and another v. Jit Ram and another, (2008) 9 Supreme Court Cases 699. Learned counsel for the tenants has further argued that the landlords have another commercial property in Sector 9-D, Chandigarh which can be put to use for expansion of the M/s. Empire Stores and the ground of expansion in the same building cannot be used as a tool to seek eviction of the tenants who are occupying the demised premises even before the same was purchased by the landlords. In reply, learned counsel for the landlords has submitted that the case set up for personal necessity was not only meant for the sons of Jai Gulati, namely, Ajay Gulati and Aman Gulati, but also by all the landlords who happened to be the partners of M/s Empire Stores who wanted to expand their business in the same building which is located in the prime commercial sector of Chandigarh. He also submitted that the landlords have categorically alleged that the space in their possession is insufficient and the accommodation in the demised premises is also suitable for their business. Insofar as the ingredients of Section 13(3)(a)(i) of the Act are concerned, the landlords have categorically alleged in para No.11 of the eviction petition that they do not own or possess any other property except the demised premises in the urban area concerned and have not vacated it without any sufficient cause after the commencement of the Act. It is also submitted that the decision in the case of Ajit Singh and another (supra), which has been heavily relied upon by learned counsel for the tenants, is not applicable to the facts and circumstances of this case. Learned counsel for the landlords has further referred to the decision of this Court in the case of S.P.Sethi v. R.R.Gulati and others, 2006(2) R.C.R. (Rent) 205 in which, in the similar circumstances, eviction petition was filed by the landlords against two other tenants who were occupying the First Floor and were successful up to this Court and have taken possession as well. Learned counsel for the landlords has also referred two decisions of the Supreme Court in the CR No.103 of 2011 (O&M) - 10 - ****** case of M/s. Sait Nagjee Purushotham & Co. Ltd. v. Vimalabai Prabhulal & Ors., 2005(2) Rent Control Reporter 436 and in the case of Akhileshwar Kumar and others v. Mustaqim and others, 2003(1) Rent Control Reporter 40. In respect of the second submission, learned counsel for the landlords has argued that another commercial property in Sector 9-D, Chandigarh would not cater to the needs of the landlords as they cannot expand their business of M/s. Empire Stores in the said building. In this regard, he has relied upon a Full Bench decision of this Court in the case of M/s. Sant Ram Das Raj Kalka v. Karam Chand Mangal Ram, AIR 1963 Punjab 1. I have heard both the learned counsel for the parties and perused the record with their able assistance. In order to appreciate the controversy, it would be necessary to understand as to what is the case set up by the landlords in the eviction petition. The landlords have alleged that they wanted to expand the business of M/s. Empire Stores in the same building in which the 3rd Floor is in occupation of the tenants who are also occupying SCO No.15 in Sector 17-E, Chandigarh. They had decided to convert M/s. Empire Stores a complete Departmental Store and besides working themselves they wanted to involve two sons of one of the partners Jai Gulati, namely, Ajay Gulati and Aman Gulati in the said business. They had pleaded that the space in their possession is insufficient to run the business of store properly and the accommodation in the said building is suitable for their business of store and for that purpose the landlords require the entire building for their personal use and occupation. They had categorically alleged that they do not own and posses any other commercial property in the urban area of Chandigarh except for the demised premises nor they have vacated the same. Insofar as the averments made in para No.11 of the written statement are concerned, it has been vaguely replied by the tenants. They had alleged that the landlords are already occupying much more space in the departmental store operating in the building. They had admitted that they are occupying half portion of SCO No.15, Sector 17-E, Chandigarh. It is nowhere pleaded that sons of Jai Gulati have not disclosed that they do not possess any such commercial building in the urban area of Chandigarh or had not vacated. CR No.103 of 2011 (O&M) - 11 - ****** In the absence of the pleadings of the parties, there was no issue and no need to lead evidence in that regard. However, it is pertinent to mention here that this point raised before this Court was not raised before the Courts below at all. The law laid down in the case of Ajit Singh and another (supra) would not be of any help to the tenants because in the said case, both father and son were before the Supreme Court. Appellant No.1 (son) became owner of the shop involved in the said case on the basis of a family partition dated 26.08.1998, whereas appellant No.2 (father) was both the landlord and the owner prior to 26.08.1998. The eviction was sought, inter alia, on the ground of personal necessity which was disputed on the ground that it is not available for use and occupation of appellant No.1 (son). The learned Rent Controller ordered eviction only on the ground of subletting which was challenged by the tenant by way of appeal and by the landlords by way of cross-objections. The learned Appellate Authority allowed the appeal of the tenant and at the same time cross-objections of the landlords and maintained the order of eviction on the ground of personal necessity. The tenants assailed the order of eviction passed on the cross-objections by way of Civil Revision in the High Court which was allowed on the ground that appellant No.2 (father) was the landlord who had failed to plead the ingredients of Section 13(3)(a)(i) of the Act. It was also held that the averments made in the eviction petition were only to the extent of personal requirement of appellant No.1 (son) which did not relate to the personal requirement of appellant No.2 (father) who was also the landlord and in the absence of averments in the eviction petition to the extent of personal requirement of appellant No.2 (father), the High Court held that the order of eviction passed by the Appellate Authority was illegal. The landlords then filed appeal before the Supreme Court in which it has been held that the requirement of the shop was for appellant No.1 (son) who admittedly became the owner and landlord by virtue of family partition dated 26.08.1998 and since he had pleaded all the mandatory requirements of Section 13(3)(a)(i) of the Act, therefore, even if the mandatory pleadings do not relate to the appellant No.2 (father) who was also a landlord, would be of no consequence. Resultantly, the Supreme Court passed the order of eviction. Thus, it is apparent that a person CR No.103 of 2011 (O&M) - 12 - ****** who maintains an eviction petition on the ground of personal necessity, has to be a landlord and has to plead all the mandatory ingredients of Section 13(3)(a) (i) of the Act in the eviction petition even if the premises is required by the said landlord for use and occupation of his son who is not required to plead all the ingredients of Section 13(3)(a)(i) of the Act if he himself is not the landlord of the premises. In the present case, the landlords have categorically pleaded that the demised premises is required for their use and occupation which is suitable and the space already in their possession is insufficient. The fact of joining two sons of Jai Gulati in the business is only an additional need and not the sole basis for seeking eviction of the tenants as the landlords themselves wanted the demised premises for their personal use and occupation for the purpose of expansion of M/s Empire Stores in the same building. Thus, I do not agree with the contention raised by learned counsel for the tenants in this regard and as such the first issue raised is hereby decided against them. It is worthwhile to mention that earlier also the landlords had filed eviction petition against two tenants, namely, S.P.Sethi and M/s. United India Insurance Company Limited on almost similar pleadings. Those two tenants were occupying First Floor of the demised premises. This Court had held that the demised premises is suitable for the purpose of expansion of M/s. Empire Stores in the same building and maintained the order of eviction passed by both the Courts below against the tenants and since they have taken the possession thereof, therefore, the order of this Court in S.P.Sethi's case (supra) was not apparently even reversed by the Supreme Court. In the case of M/s. Sait Nagjee Purushotham & Co. Ltd. (supra), the Supreme Court has held that if the landlord is doing business at place `A' who wanted to expand his business at place `B', the need of the premises at latter place is found to be bona fide and it was held that it is the privilege of the landlord to choose nature and place of the business and the tenant cannot advise the landlord in this regard. In the case of Akhileshwar Kumar and others (supra), it is held by the Supreme Court that if the landlord has got more than one shop, it is for