Case: K. K. Chari Vs. R. M. Seshadri

2. The appellant was occupying a premises in Madras as a tenant. His landlady filed an application H. R. C. No. 1924 of 1967 seeking eviction of the appellant on the ground that she bona fide required the premises for her own occupation. At that time the suit premises No. 64, Lloyds Road, Royapettah,, was advertised for sale. The appellant for purposes of his occupation purchased the premises on October 23. 1967, as per registered document No. 1633 of 1967 ins Office, Mylapore. The respondent was then a tenant of the suit premises under the vendor. After the purchase, he attorned in favour of the appellant and has been paying rent. An eviction order was passed by consent against the appellant in H. R. C. No. 1924 of 1967 on January 27, 1968. He was given time till January 27, 1969, to vacate the premises, of which he was in occupation as a tenant, by virtue of the said decree. On the same day i. e. January 27, 1968, the appellant issued two notices to the respondent his tenant, in respect of the suit premises terminating the tenancy of the Respondent under Section 106 of the Transfer of Property Act and calling upon him to quit and deliver vacant possession on February 29, 1968. The two notices were given because of the fact that the first notice had asked for vacant possession on February 28, 1968 and to avoid any objection regarding the first notice probably the second notice was also given asking for possession on February 29, 1968. In both the notices. the appellant had referred to the purchase of the bungalow in question for his own occupation and also attributed knowledge of the said purpose to the tenant. There is a reference to the appellant being a tenant of premises No. 2, Lakshmipuram, 1st street,, and to his having no other house of his own in the city of Madras except the suit premises. It is further stated that in view of the fact that an eviction order against him has been passed on January 27, 1968, in H. R. C. 1924 of 1967, the appellant requires his own bungalow, namely, the suit premises in the occupation of the respondent for his own bona fide use and occupation3. As the respondent did not surrender possession of the premises, the appellant filed H. R. C. No. 983 of 1968 in the. Court of Small Causes, Madras under Section l0 (3) (a) (i) of the Madras Buildings (Lease and Rent Control) Act, 1960 (thereinafter referred to as the Act). In this petition, after referring to the purpose of the suit premises, as well as the order of eviction passed against him in H. R. C. No. 1924 of 1967, the appellant has stated that he has no other house of his own anywhere in the city of Madras excepting the suit premises of which the respondent is the tenant. He has further averred that he has terminated the tenancy of the respondent by issuing notices on January, 27, 1968, and that the tenant has not vacated the premises though he has received the notice. There is also a reference to the fact that the respondent is not in essential service and that the suit premises is not exempt under Section 30 of the Act. He has further stated that he requires the house for his bona fide use and occupation. Accordingly he prayed for eviction of the respondent and for possession being delivered to him4. The respondent filed two, one on July 19, 1968 and another on January 14,1969. In the former he has raised the contention that he is not a tenant of the suit premises, either under the appellant or under the previous owner of the premises. According to him, the tenant of the premises was and continues to be at the relevant time M/s R. M. Seshadri, a partnership firm. He has further pleaded that as he was never a tenant, the claim made by the appellant of having terminated his tenancy is meaningless. Finally he has stated that the application is not maintainable against him and prayed for its being dismissed. In the additional, the respondent pleaded that appellant does not require the house for his occupation and that his claim is not bona fide. He has also controverted the claim of the appellant that an eviction order had been passed against him in H. R. C No. l924 of l967. In any event, the order of eviction against the appellant is a collusive one and is only a device to evict the respondent. He further pleaded that the purchase by the appellant itself is not lawful. Finally he raised contention that the tenant, M/s R. M. Seshadri, has spent enormous amounts on the house acting on the assurance of its previous owner that the house would never be sold and the tenant of the premises would never be evicted. Finally there is a challenge also to the notices determining the tenancy not being in accordance with law5. The enquiry before the Court of Small Causes appears to have commenced on January 16, 1969. The appellant was examined on that day as P.W. 1 and his evidence appears to have spread over till February 20, 1969. In the course of his evidence, he has spoken to his being a tenant of a house of which one Seethalakshmi Ammal was the landlady and to her having filed an application for eviction against him to his purchasing the present suit premises on October 23, 1967, for purposes of his own occupation, to the respondent having been a tenant against the original landlord at the time of purchase and later attorney to him, to the payment of rent by the respondent subsequent to the purchase and to the notices issued to the respondent terminating his tenancy under Section 106 of the Transfer of Property Act and requiring him to deliver possession of the property for purposes of his occupation. He has also filed a large volume of exhibits in respect of the matters spoken to by him before the court. He has particularly mentioned the fact that he purchased the said house for purposes of his occupation, as he was under orders of eviction in H. R. C. No 1924 of 1967 and to his having no other house in the city of Madras. The last exhibit that was filed by him was Exhibit P. 45, which was a certified copy of the order in H. R. C. No l924 of 1967, which showed that an order of eviction had been passed against the appellant on January 27, 1968, and he was given time till January 27, 1969, for vacating the premises. It was no doubt a consent order. But all the exhibits filed by him clearly go to establish that his evidence that he required the suit premises bona fide for his own occupation, was true. The respondent had not chosen toe the appellant. On March 31, 1969, both parties entered into a compromise in the following terms:(1) The Respondent hereby withdraws his defence in the aforesaid petition and submits to a decree for eviction unconditionally(2) The Respondent prays that time for vacating up to 5th June 1969 might please be given and the petitioner agrees to the same(3) The Respondent agrees to vacate the petition premises and hand over possession of the entire petition premises to the petitioner on or before the said date viz. 5th June 1969 without fail under any circumstances and undertakes not to apply for extension of time(4) It is agreed by both the parties that this Memo of Compromise is executable as a Decree of CourtDated at Madras, this the 31st day of March, 1969The compromise petition was signed by both the appellant and the respondent as well as the advocates appearing for them. The court, after referring to the petition of the landlord being under Section 10 (3) (a) (i) of the Act on the ground of his own occupation, passed the following order :Compromise memo filed and recorded. By consent eviction is ordered granting time to vacate tillThe terms of compromise, which have been already set out, were also incorporated in the order6. It will be noted that the respondent had raised substantially the following defence to the application filed by the appellant, namely(1) he was not a tenant of the premises and that on the other hand, the tenant of the premises was M/s R. M. Seshadri, a partnership firm;(2) the claim of the appellant that he requires the house for his occupation is not bona fide;(3) the purchase of the premises by the appellant is not lawful;(4) the tenant, M/s R. M. Seshadri, has spent enormous amounts by way of repairs and improvements; and(5) the notice determining the tenancy is not in accordance with law. It was to meet the above defence and also to establish his claim of requiring the premises bona fide for his own occupation, thet gave the evidence and also produced about 45 exhibits. It is needless to state that the respondent, who is a retired I. C. S. officer and an advocate, must have been fully aware of the averments made by the landlord, the pleas raised in defence as well as the nature of the evidence led by the landlord to meet his defence. The respondent, apart from not havingd the landlord, when he gave evidence, has also by the compromise withdrawn all his defence to the application filed by the landlord and submitted to a decree for eviction unconditionally. It is with this background that one has to appreciate the nature of the decree passed by the Court on March 31, 19697. It is also seen from the records that the appellant paid a sum of Rs. 20,000/on March 31,1969 to the respondent towards the cost of repairs and improvements effected by him during his occupation of the suit premises. On the same date, as the compromise i. e. March 31, 1969, the respondent passed a letter to the appellant. In this letter after referring to the compromise filed in the court as well as the order passed thereon, he gave an undertaking to vacate the premises on or before June 5, 1969. He also acknowledged the receipt of the sum of Rs. 20,000/from the landlord towards the cost of repairs and improvements. The respondent has also further agreed to refund the sum of Rs. 20,000/if he does not vacate the premises within time and he has also further agreed to pay an additional sum of Rs. 10,000/as damages. We are not concerned with this sum of Rs. 20,000/or the further agreement of the respondent to pay damages. The respondent has further stated in the said letter that in the event of his failure to vacate the premises within time, the landlord is at liberty to execute the decree of eviction without any further notice to him8. The assurance and the undertaking given by the respondent to abide by the compromise decree and to vacate the premises without raising any objection have proved to be of no avail, as will be seen from the events that followed. When the time for delivery of property was drawing near, the respondents son, one S. M. Sundaram, filed a suit in the City Civil Court, Madras, for a declaration that the purchase by the appellant of the suit property was void. The son also obtained an interim injunction against the appellant from executing the order of eviction passed in H. R.C. No. 983 of 1968 and disturbing his possession. The suit was tried on merits and was ultimately dismissed by the City Civil Court on December 12, 1969 with costs of the appellant. According to the appellant, this suit was engineered by the respondent himself in order to put off his eviction from the suit property9. After the dismissal of the above suit, the appellant filed execution petition No. 953 of 1969 in the City Civil Court, Madras (which was the competent Court for purposes of execution) to execute the order of eviction against the respondent in H. R. C. No. 983 of 1968. The respondent filed E. A No. 1314 of 1969 objecting to the execution of the decree on the ground that it was a nullity and inexecutable; and as such he prayed for the warrant of possession issued in Execution Petition to be recalled and to dismiss the Execution Petition itself. His main plea in this application was that the decree sought to be executed was one based on compromise or consent without the Rent Control Court having satisfied itself by an independent consideration regarding the bona fide requirement of the property by the landlord for his own occupation; and as such the decree contravened Section 10 of the Act. This application was opposed by the appellant in a lengthy, the landlord, after referring to the various items of evidence adduced before the court, which have been referred to earlier, has stated that it was when the respondent found that the pleas raised by him could not be sustained and that the landlords case was true that he unconditionally withdrew his defence and submitted to a decree. He has further pleaded that the decree sought to be executed does not suffer from any infirmity10. The learned City Civil Judge by his order dated March 18, 1970, overruled the objections raised by the respondent and dismissed E A No. 1314 of 1969 and gave time to the respondent till April 20, 1970, to vacate and deliver the possession of the property11. The respondent carried the matter to the High Court in Civil Revision Petition No. 797 of 1970. The High Court by its judgment and order dated September 15, 1970, has reversed the order of the City Civil Court and accepted the contentions of the respondent. The learned Judge has held that the decree for eviction dated March 31, 1969, is solely passed on the basis of the compromise and the Rent Controller has not applied his mind to satisfy himself whether the bona fide requirement of the landlord has been established. It is the further view of the High Court that even if there was enough material before the Rent Control Court, when it, passed the order of eviction by consent, the decree will, nevertheless, be void so long as the Rent Controller has not given his decision regarding the requirement of the landlord being bona fide. On this line of reasoning the learned Judge held that the eviction order is a nullity and is not executable.

Court's reasoning:
17. Our attention has been drawn to certain English decisions rendered under the Rent Restrictions Act, wherein it has been held that though the court has jurisdiction to order possession in favour of a landlord only on one or other of the specified statutory grounds, the court may act on an admission made by a tenant in that behalf and pass an order of eviction without being obliged to hear a case out. It is not necessary for us to refer to those decisions as in our opinion, the case on hand will have to be decided in accordance with the principles laid down by this Court18. There are three decisions of this Court which require to be considered. In Bahadur Singh v. Muni Subrat Dass, (1969) 2 SCR 432  , a decree for eviction passed on the basis of a compromise between the parties, was held by this Court, to be a nullity as contravening Section 13 (1) of the Delhi and Ajmer Rent Control Act 1952It will be seen from this decision that the decree was held to be a nullity because the landlord was not a party thereto, and also because the court had not satisfied itself that a ground for eviction, as required by the statute, existed. This decision is certainly an authority for the proposition that a court ordering eviction has to satisfy itself that a statutory ground of eviction has been made out by a landlord. How exactly that satisfaction is to be expressed by the court or gathered from the materials, has not been laid down in this decision, as this Court was not faced with such a problem20. In Kaushalya Devi v K. L. Bansal, (1969) 2 SCR 1048   = (AIR 1970 SC 838  ) the question again rose under the same Delhi statute regarding the validity of a decree passed for eviction on compromiseThe tenant did not vacate the premises within the time mentioned as per the compromise memo. On the other hand, he filed an application under Section 47, Civil Procedure Code, pleading that the decree is void as being in contravention of S. 13 of the Delhi statute. The High Court held that the decree was a nullity, as the order was passed solely on the basis of the compromise without indicating that any of the statutory grounds mentioned in Section 13 existed. Following the decision in Bahadur Singh, (1969) 2 SCR 432     this Court upheld the order of the High Court. Here again, it will be seen that the manner in which the courts satisfaction is to be expressed or gathered has not been dealt with21. A similar question came up again before this Court in Perozi Lal Jain v. Man Mal, AIR 1970 SC 794  . The landlord filed an application for eviction of the tenant on the ground that he had sublet the premises without obtaining his consent in writing. Subletting, without the consent of the landlord in writing, was one of the grounds under Section 13 (l) of the Delhi statute entitling a landlord to ask for eviction. The tenant denied the allegation that he had sublet the premises. Both the landlord and the tenant entered into a compromise and the court, after recording the same, passed the following orderAs the tenant did not surrender possession of the properties within the time mentioned in the compromise memo, the landlord levied execution. It was resisted by the tenant on various grounds one of which was that the decree for eviction was a nullity, being in contravention of Section 13 of the Delhi statute. This contention was accepted by the execution Court, as well as by the High Court. This Court, after a reference to the provisions of S. 13, held that a decree for recovery of possession can be passed only if the court concerned is satisfied that one or other of the grounds mentioned in the section is established. This Court, further observed :From the facts mentioned earlier, it is seen that at no stage, the Court was called upon to apply its mind to the question whether the alleged subletting is true or not. Order made by it does not show that it was satisfied that the subletting complained of has taken place, nor is there any other material on record to show that it was so satisfied. It is clear from the record that the court had proceeded solely on the basis of the compromise arrived at between the parties. That being so there can be hardly any doubt that the court was not competent to pass the impugned decree. Hence the decree under execution must be held to be a nullity22. Reference was also made to the two earlier decisions holding such decrees to be void. It is significant to note that this Court in the last mentioned decision referred to the facts leading upto the compromise decree, namely, the basis of the claim of the landlord, the denial by the tenant and both of them filing a memo of compromise without any reference to the plea of subletting made by the landlord. In the said decision this Court has held that the compromise decree is void, as there could have been no satisfaction of this Court regarding the statutory requirement in view of the following three circumstances:(1) At no stage the Court was called upon to apply its mind to the question whether the plea of subletting is true or not(2) The order made by the Court does not show that it was satisfied that the subletting complained of has taken place(3) There was no other material on record to show that the court was so satisfiedThe view of this Court further is that the decree for eviction has been passed solely on the basis of the compromise arrived at between the parties23. In the last decision, in our opinion, there is an indication as to how the satisfaction of a court can be expressed or gathered in a particular case. If a stage had been reached in a particular proceeding for a court to apply its mind regarding the existence of a statutory condition, it may be held that it was so satisfied about the plea of the landlord. Again from other material on record, it can be inferred that the court was so satisfied24. We are not inclined to accept the contention of Mr. Tarkunde that the decree for eviction in the case before us has been passed solely on the basis of the compromise arrived at between the parties. No doubt a reading of the order of the court dated March 31, 1959,isolated from all other circumstances, may give the impression that the decree for eviction is passed because of the compromise between the parties. It is no doubt true that the order on the face of it does not show that the court has expressed its satisfaction that the requirement of the landlord is bona fide. If the court had expressed its satisfaction in the order itself, that will conclude the matter. That the court was so satisfied can also be considered from the point of view whether a stage had been reached in the proceedings for the court to apply its mind to the relevant question? Other materials on record can also be taken into account to find out if the court was so satisfied. The High Court has proceeded on the basis that even if there was material before the court, when it passed the order of eviction by consent, from which it can be shown that the court was satisfied about the requirement of the landlord being bona fide, nevertheless such an order will be a nullity unless the Rent Controller has given his decision in favour of the landlord. In our opinion, this view is erroneousUnder these circumstances, when the tenant has accepted the plea of the landlord, in our opinion, it is futile to hold that the Rent Controller must again embark upon an enquiry regarding the requirement of the landlord being bona fide and adjudicated upon the same. Ofcourse, if there is a dispute between the landlord and tenant, the court must decide the matter and adjudicate upon the plea of the landlord26. The true position appears to be that an order of eviction based on consent of the parties is not necessarily void if the jurisdictional fact viz. the existence of one or more of the conditions mentioned in S. l0 were shown to have existed when the Court made the order. Satisfaction of the Court, which is no doubt a prerequisite for the order of eviction, need not be by the manifestation home out by a judicial finding. If at some stage the Court was called upon to apply its mind to the question and there was sufficient material before it, before the parties invited it to pass an order in terms of their agreement, it is possible to postulate that the Court was satisfied about the grounds on which the order of eviction was based28. For all the reasons mentioned above, it cannot be held in the particular circumstances of this case, that the decree for eviction has been passed solely on the basis of the compromise entered into between the parties. On the other hand, it is clear from the various matters referred to, that the court was satisfied about the bona fide requirement of the landlord. Therefore, the decree for eviction is neither void nor inexecutableWe are not impressed with this contention. Once it is accepted that the question about the decree being void and as such not executable on any ground available in law can be raised before the executing Court, it is needless to state that the executing Court will have to adjudicate upon that plea and for that purpose the relevant materials have to be considered. If that is so, there is no insurmountable difficulty, as envisaged by Mr. Tarkunde, in an executing Court considering whether a particular decree for eviction is void as being contrary to the relevant sections of the statute governing the matterAs those matters have not been considered by the courts below, as requested that the proceedings may be remanded for this purpose. We are not inclined to accede to this request. The tenant raised these objections also in his original plea, but he has unconditionally withdrawn all his defence. That means those pleas also no longer survive for consideration34. I am of opinion that in this approach learned Judge relied more on the form than the substance of the matter. The true approach has been pointed out by our learned brother, Vaidialingam, J. He has pointed out that while the decision in Bahadur Singhs case (1969) 2 SCR 432     was an authority for the proposition that a court ordering eviction has to satisfy itself that a statutory ground of eviction has been made out by a landlord how exactly that satisfaction was to be expressed by the court or gathered from the materials, has not been laid down in that decision; that in Kaushalya Devis case AIR 1970 SC 838   also the manner in which the courts satisfaction was to be expressed or gathered has not been dealt with; nor has the decision in Ferozi Lals case AIR 1970 SC 794   given an indication as to how the satisfaction of a court could be expressed or gathered in a particular case. He has pointed out that if a stage had been reached in a particular proceeding for a court to apply its mind regarding the existence of a statutory condition, it may be held that it was so satisfied about the plea of the landlord. Again, from other material on record it can be inferred that the court was so satisfied. He has also pointed out how in the particular circumstances of the present case as the tenant had withdrawn his defence and submitted to a decree for eviction unconditionally, he had accepted the claim of the landlord that he required the premises bona fide for his own occupation; that he has accepted the position that the landlord has made out the statutory requirement entitling him to ask for possession of the premises; that by this unconditional withdrawal of the defence regarding the statutory condition pleaded by the landlord, and the compromise following it that was accepted by the court, the tenant has accepted the plea of the landlord, and it is futile to hold that the Rent Controller must again embark upon an enquiry regarding the requirement of the landlord being bona fide and adjudicate upon the same. He has also pointed out that the true position appears to be that an order of eviction based on consent of the parties is not necessarily void if the jurisdictional fact, viz. the existence of one or more of the conditions mentioned in Section 10 were shown to have existed when the court made the order; that the satisfaction of the court, which is no doubt aprerequisite for the order of eviction, need not be by the manifestationborne out by a judicial finding; and that if at some stage the court was called upon to apply its mind to the question and there was sufficient material before it before the parties invited it to pass an order in terms of their agreement, it is possible to postulate that the court was satisfied about the grounds on which the order of eviction was based. He has further pointed out that if the tenant in fact admits that the landlord is entitled to possession on one or other of the statutory grounds mentioned in the Act, it is open to the court to act on that admission and make an order for possession in favour of the landlord without further enquiry It is on these grounds that he has come to the conclusion that the facts in this case satisfied these tests and, therefore, the order of the Madras High Court should be set aside. In so far as it is necessary for the purpose of this case this is a satisfactory conclusionAfter fully considering the matter I am definitely of the opinion that if the compromise decree is based on the grounds on which the landlord could claim a decree for eviction under Section 13 of the East Punjab Urban Rent Restriction Act, then it is within the jurisdiction and competence of the Rent Controller to pass such a decree with a default clause; it is similarly competent for the civil court to execute such a decree when default has occurred. The proviso ton (2)of Section 13 of the Act is not attracted in such circumstances as no question of extending time granted to the tenant for putting the landlord in possession arises. In the result my answer to the two questions referred would be in the affirmative40. All these decisions amply support the proposition that I have put forward that an eviction order based on a compromise where the landlord has asked for possession on any one of the grounds on the basis of which he could ask for possession would be valid. This would, however, have to be considered when a proper occasion arises.