Case: M/S. Precision Steel &amp; Engg.Works  Vs. Prem Deva Niranjan Deva Tayal

2. The tenancy premises are situated at B-44, Greater Kailash, Part I, New Delhi. Out of the building standing over 1000 sq. yards plot the appellants are in occupation of the front portion of the ground-floor since 1971. Premises comprise of four bed-rooms, 3 bathrooms, 1 barsati, 1 garage and the servant quarters along with one bathroom for servants. At this stage, it it so more in controversy that the respondent is owner-cum-landlord of the premises and the appellants are the tenants. The terms of tenancy are incorporated in a document dated 13th September, 1971 called Licence Deed. The Rent Controller and the High Court have both recorded findings of fact that the suit premises are required bona fide by the respondent-landlord for occupation as a residence for himself and the members of his family and for satisfying such requirement the respondent does not possess any other suitable accommodation. The controversy centers around determination of the purpose for which the premises have been let, and, depending on the answer, whether the applicability of Section 14(1)(e) of the Act is attracted. In the opinion of the Rent Controller - it is not; in the opinion of the High Court - it is3. Clauses 6,7, 12 and 16 of the Licence Deed, which were referred to by the learned counsel for the parties during the course of hearing, are extracted and reproduced hereunder:6. The Licensees shall use the said premises for the residence of their Directors, partners, and officers. The Licensees will, however, be free to use the said premises in part or in full also for office purpose provided the rules of the local authorities so permit and in such an even the Licensees shall pay to the owners any increase in local taxes, etc. occasioned by such change of use of the said premises from residential to office7. The Licensees shall not permit the said premises or any part thereof being used by any other person for any purpose whatsoever without the previous consent in writing of the owners and in default thereof the Licence shall be liable for cancellation. The Licensees shall not transfer possession of the premises or part thereof or otherwise carry on the business in the premises with any other person or assign, transfer, change or otherwise alienate their interest in the premises12. The Licensees shall comply at all times with all the rules and regulations of the local authorities whatsoever in relation to the said premises16. The Licensees agree and understand that the said premises shall not be used for any illegal or immoral purpose, for gambling or for sale of alcoholic beverages and the owners shall have full right to cancel the Licence by giving one months notice in case the said premises are used for any of these purposes and to claim in full the balance of the Licence-fees for the unexpired part of the Licence period and in addition to claim damages/for less of good reputation of the premises and the owners and also expenses sustained in the removal of the Licensees establishment from the said premises4. A few other relevant undisputed facts may also be noticed. The master plan and the zonal plan of the locality where the suit premises are situated have earmarked the area as residential. No activity other than residential is permissible thereat. This is so by virtue of the provisions contained in Delhi Development Act, 1957 and Delhi Municipal Corporation Act, 1957, the relevant provisions whereof will be referred to where needed. It appears that on 18.3.1982, a junior engineer of Delhi Development Authority (DDA, for short) inspected the premises occupied by the appellants and found that a front room on the ground floor was being used for running an office of the appellant-company. The company, which is the tenant, and its director and constituted attorney, the appellant no.2 were prosecuted for having committed an offence punishable under Section 14 read with Section 29(2) of DDA Act for the residential building falling in development zone F-II which can be used only for residential purposes according to master plan, was being used for running and office therein. The Metropolitan Magistrate found such misuser having been proved. The defence taken by the appellants was that only one room of the tenancy premises was used for his office by appellant no.2 as he being a director of many companies the personnel thereof were coming to him for consultancy work which was transacted in the one room office. The appellants were convicted and directed to pay a fine of Rs. 3000/- each.

Reasoning:
9. In our opinion the expression the premises let for residential purposes should be construed liberally and not technically or narrowly; meaning thereby, where the premises are solely let for residential purposes they are undoubtedly covered by Section 14(1)(e) but even when the premises are let out for composite or mixed purposes if the predominant or main purpose of letting is for residential purposes, the same would be included within the expression the premises let for residential purposes. An incidental, a secondary or unauthorized user of the premises for purposes other than residence would not take the premises out of the meaning of the expression the premises let for residential purposes16. In our opinion, for the purpose of Section 14(1)(e) of the Act, so long as the principal and dominant purpose of letting is residential merely because a mixed user of the premises or user of a part or incidental or ancillary user of the premises is permitted for activities other than residential, the purpose of letting the premises would not cease to be residential and the premises would continue to be governed by Section 14(1)(e) of the Act22. The learned senior counsel for the appellants referred to the explanation appended to Section 14(1)(e) and submitted that the Legislature in its wisdom thought fit to enact that premises let for residential purposes if used incidentally for commercial or other purposes by the tenant but without the consent of the landlord would not alter the purpose and the enactment of the explanation is suggestive of legislative intent that even incidental user for commercial or other purposes if accompanied by the consent of the landlord would take the premises out of the expression premises let for residential purposes. We cannot agree. The enactment of explanation is ex abundanti cautela. All that the explanation say is that the tenant cannot by his unilateral at of impermissible user, alter the purpose of letting. This explanation has nothing to do with determining the main, principal or dominant purpose of letting - the theory which in our opinion applies to interpreting the expression the premises let for residential purposes in Section 14(1)(e) of the Act