Case: Panchamal Narayan Shenoy Vs. Basthi Venkatesha Shenoy

satisfy the Court that he reasonably and bona fide requires the premises for the immediate purpose of demolishing it and the demolition is for the purpose of erecting a new building in the place of the old one. No doubt, as to whether the landlords requirement is reasonable and bona fide has to be judged by the surrounding circumstances, which will include his means for reconstruction of the building, and other steps taken by him in that regard.12. In considering the reasonable and bona fide requirement of the landlord under this clause, the desire of the landlord to put the property to a more profitable use after demolition and reconstruction is also a factor that may be taken into account in favour of the landlord. In our opinion, it is not necessary that the landlord should go further and establish under this clause that the condition of the building is such that it requires immediate demolition. That the condition of the property may be such which requires immediate demolition is emphasized in clause (k) of the proviso. When such a specific provision has been made in clause (k), the condition of the building cannot come into the picture nor could it have been dealt with again in Clause (j). So the requirement under Clause (j) is that of the landlord and cannot have any reference to the building.13. This Court, in Neta Ram v. Jiwan Lal, (1962) Supp. 2 SCR 623 - (AIR 1963 SC 499 ) in interpreting no doubt a slightly differently worded provision in Section 13 (3) (a) (iii) of the Patiala and East Punjab States Union Urban Rent Restriction Ordinance, 2006 B. K (8 of 2006 BK) held that one of the circumstances which could be taken into account in considering the requirements of the landlord with reference to the existing building is the possibility of its being put to a more profitable use after construction. In the case before us all the Courts have concurrently held that the requirement of the landlord is reasonable and bona fide and that he had obtained the necessary sanction from the municipality concerned and that the landlord had also the means for reconstruction of the building. If the landlord does not commence demolition of the premises within the period specified in the order of the Court, the tenant is given a right under Section 26 (1) to issue a notice to the landlord of his intention to occupy the premises from which he had been evicted and also to apply to the Court for relief if the landlord does not comply with his request. Again, under Section 27, the tenant has got a right to occupy the new building on its completion provided he satisfies the requirements contained in that section. Under Section 28 (1), the landlord is bound to intimate the tenant from whom he had received a notice under Section 27 the date on which the erection of the new building will be completed from which date the tenant will be entitled to occupy the same.14. Mr. Chagla has referred us to a decision of the Madras High Court in Mehsin Bhai v. Hale and Company, (1964) 2 Mad LJ 147. The section which came up for consideration before the Madras High Court was Section 14 (3) of the Madras Buildings (Lease and Rent Control) Act, 1960 (Act XVIII of 1960) which was as follows:"14 (l) (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, pass an order directing the tenant to deliver possession of the building to the landlord before a specified date."That clause is substantially similar to Section 21 (1)(j) of the Act. In the Madras case it is seen that the building from which the tenant was sought to be evicted was in good condition and there was no danger of its falling for another 20 years though the building was old. Under those circumstances when the landlord applied under Section 14 (1) (h) of the Madras Act for eviction on the ground that he wished to demolish the building for the purpose of erecting a new building thereon, the High Court affirmed the decision of the Subordinate Court declining relief to the landlord. Though the learned Judge states that landlords may bona fide require such buildings, particularly old buildings in their own interest for demolition and reconstruction, he holds that it is equally possible that the mere fact that a building is old may be taken advantage of by a landlord to put forth such pretext, his real object being ulterior and not bona fide for the purpose of reconstruction.15. We have no hesitation in agreeing with the learned Judges observation that the landlord must prove the reasonableness and bona fide nature of his requirement. But, if the learned Judge intended to lay down a proposition of law that under Section 14 (1) (h) of the Madras Act, similar to Section 21 (1) (j) of the Act, a landlord cannot recover possession of the property for the purpose of reconstruction so as to put the property to a more profitable use, we are of the view that the decision of the Madras High Court must be considered to be erroneous. There is absolutely no justification for putting such a narrow interpretation on the clause in question16. Mr. Chagla further urged that before his client is evicted his claim for compensation should have been considered by the Rent Controller. It is enough to say that, as pointed out by the High Court, that claim does not arise for consideration in these proceedings. We may also state that a further contention regarding the validity of the notice to quit issued by the landlord which was taken before the High Court and held against the appellant, has not been canvassed before us.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]8. Having due regard to the scheme of the Act, we are satisfied that the interpretation placed upon Section 21 (1) (j) by the High Court is correct.We have no hesitation in agreeing with the learned Judges observation that the landlord must prove the reasonableness and bona fide nature of his requirement. But, if the learned Judge intended to lay down a proposition of law that under Section 14 (1) (h) of the Madras Act, similar to Section 21 (1) (j) of the Act, a landlord cannot recover possession of the property for the purpose of reconstruction so as to put the property to a more profitable use, we are of the view that the decision of the Madras High Court must be considered to be erroneous. There is absolutely no justification for putting such a narrow interpretation on the clause in question16. Mr. Chagla further urged that before his client is evicted his claim for compensation should have been considered by the Rent Controller. It is enough to say that, as pointed out by the High Court, that claim does not arise for consideration in these proceedings. We may also state that a further contention regarding the validity of the notice to quit issued by the landlord which was taken before the High Court and held against the appellant, has not been canvassed beforeour opinion, it is not necessary that the landlord should go further and establish under this clause that the condition of the building is such that it requires immediate demolition. That the condition of the property may be such which requires immediate demolition is emphasized in clause (k) of the proviso. When such a specific provision has been made in clause (k), the condition of the building cannot come into the picture nor could it have been dealt with again in Clause (j). So the requirement under Clause (j) is that of the landlord and cannot have any reference to the building.e have no hesitation in agreeing with the learned Judges observation that the landlord must prove the reasonableness and bona fide nature of his requirement. But, if the learned Judge intended to lay down a proposition of law that under Section 14 (1) (h) of the Madras Act, similar to Section 21 (1) (j) of the Act, a landlord cannot recover possession of the property for the purpose of reconstruction so as to put the property to a more profitable use, we are of the view that the decision of the Madras High Court must be considered to be erroneous. There is absolutely no justification for putting such a narrow interpretation on the clause in question