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citation codes
Case Number
Attorney(S)
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Acts
  • Rent Control) Act, 1960,
  • section 10 (3) (a) (iii).
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Attorney(S)
Judges
Acts
  • Rent Control) Act, 1960,
  • section 10 (3) (a) (iii).
Smart Summary

Factual and Procedural Background

The State Government exempted the tenanted portion of premises No. 176/2, Anna Pillai Street, George Town, Madras, from Section 10 of the Madras Building (Lease and Rent Control) Act, 1960, under Section 29. The tenant objected that the landlord, a poojari, was not carrying on a business for which he could bona fide require the premises. [1]

The Government found that the landlord bona fide required the shop to start and run his own business, although he had not yet commenced it. The tenant’s subsequent revision petition was dismissed on 28 December 1968. His Article 226 writ petition was dismissed as belated by Alagiriswami, J. [2][3]

Legal Issues Presented

  1. Whether the tenant’s writ petition was liable to be dismissed for delay. [3][4]
  2. Whether the landlord had an available remedy under Section 10, making the Government’s exemption under Section 29 without jurisdiction. [5]
  3. Whether a landlord must already be carrying on business, or need only have taken concrete steps towards commencing business, to invoke Section 10(3)(a)(iii). [6][7][8]
  4. Whether the Government’s finding that the landlord’s requirement was bona fide could be disturbed. [9]

Arguments of the Parties

Appellant's Arguments

  • The landlord was a poojari and was not carrying on a business for which he could bona fide require the premises. [1][6]
  • The landlord had a remedy under the Act, so the exemption under Section 29 was without jurisdiction. [5]
  • The tenant had occupied the premises for many years and invested substantial funds in his business, making eviction harsh. [9]

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
C.R.P No. 137 of 1965 Section 10(3)(a)(iii) was read as requiring the landlord actually to be carrying on business. The Court declined to adopt this literal construction. [10][11][8]
Civil Revision Petition No. 1891 of 1956 Preparation to do business could suffice to invoke the statutory provision. The Court treated this approach as reasonable, while distinguishing mere intention without any concrete step. [12][8]
Nataroja Achari v. Balasubramaniam, 19572 M.L.J 492. Subscribed, more or less, to the view that preparation to do business could be sufficient. The Court considered this approach supportive of its interpretation. [12][8]
Ramaswamy Pillai v. Karmega Thevar, 1964 2 M.L.J 84. Also adopted, more or less, the view that preparation to do business could suffice. The Court considered this approach consistent with its interpretation. [12][8]
(1964) 2 M.L.J 89. The opinion referred to this authority in discussing the landlord’s bona fide requirement and the statutory balance between landlords and tenants. The Court held that it could not re-assess the bona fide finding as if exercising appellate jurisdiction. [9]

Court's Reasoning and Analysis

The Court first held that the writ petition was not delayed. The tenant had bona fide pursued the matter before the Government until the end of December 1968 and had promptly approached the Court after the revision was dismissed. [4]

On the merits, the Court accepted that Section 29 exemption is not a substitute for eviction remedies available under the Act. If a landlord seeks eviction under the Act, there would ordinarily be no occasion for the Government to exercise Section 29 powers; the two powers are mutually exclusive. [5]

The decisive question was whether the landlord could have used Section 10(3)(a)(iii). The Court held that “carrying on a business” may involve a series of steps. A concrete step towards commencing business may satisfy the statutory requirement, but mere intention, without any step at all, does not. [6][7][12][8]

Because the landlord had not yet commenced business and had taken no demonstrated step placing the matter beyond intention, the Government was correct to proceed on the basis that Section 10(3)(a)(iii) was unavailable. The exemption under Section 29 was therefore competent. [8]

The Court also declined to interfere with the Government’s finding of bona fide requirement. The authority was entitled to examine bona fides, and the finding was neither unreasonable nor perverse. The tenant’s hardship did not invalidate the exemption, since statutory tenant protection remained subject to the Act’s provisions. [9]

Holding and Implications

Appeal dismissed with costs. Counsel’s fee was fixed at Rs. 100. [13]

The exemption from Section 10 remained valid because the landlord had no available remedy under Section 10(3)(a)(iii) while his proposed business remained uncommenced, and the finding of bona fide requirement was not shown to be unreasonable or perverse. [8][9]

The decision directly upheld the exemption against the tenant; no separate broader implications were discussed in the opinion.

    P.N. Raju Chettiar v. State Of Tamil Nadu

    (Delivered by Veeraswami, C J.)

    The State Government by an order dated 3rd March, 1967, made under S 29 of the Madras Building (Lease and Rent Control) Act, 1960, exempted the portion under tenancy in premises No. 176/2 in Anna Pillai Street, George Town, Madras, from the provisions of S. 10. The appellant, who is the tenant, filed his objections stating inter alia that the respondent Landlord was but a peojari and was not carrying on a business for which he could bona fide require the premises for his occupation. With reference to that the impugned order says:

    “The Government are satisfied that the claim of the landlord that he required the shop portion in the occupatien of the tenant for starting and running a business of his own is bona fide. But the landlord is yet to commence the business.”

    On that view, the order proceeded on the basis that the landlord had no remedy under the provisions of the Act and exercise of the powers under S. 29 was called for. The appellant unsuccessfully pursued the matter before the Government by means of what he called a revision petition which was eventually dismissed on 28th December, 1968. On 24th January, 1969 ho moved this Court under Art. 226 of the Constitution for quashing the exemption. Alagiriswami, J., dismissed it on the ground that it was belated.

    We agree with the appellant that the ground on which the writ petition was dismissed cannot be sustained. The appellant was until the end of December, 1968 pursuing, and we should think bona fide, the matter before the State Government. Then, when he was unsuccesful, he promptly resorted to this Court. We are clearly of opinion that, in the circumstances, there was no delay, and, if there was, it should have been condoned.

    In the circumstances, we thought it best that we should ourselves deal with the merits of the appellant's contention againt the validity of the exemption. It is strenuously pressed upon us for the appellant that the respondent landlord had a remedy under the provisions of the Act so that the exemption was without jurisdiction. It is now well settled that the remedy by way of exemption under S. 29 is not a substitute for remedities available to a landlord for eviction under the Act. If he asks for eviction under the provisions of the Act, there could certainly be no occasion for the State Goverment to exercise its powers under S. 29. The two powers are mutually exclusive. To that extent the appellant is right.

    But the point is whether any remedy was avilable to the landlord under S. 10. As we mentioned, it was urged before the Government as well as before us, that the landlord, being a poojari, did not and was not carrying on a business. The finding in the impugned order is also that he Was not actually carrying on the business, and, in fact, he had yet to commence the business. In such circumstances, could the landlord have resorted to the remedies under S. 10 ? Sub-Cl. (iii) of Cl. (a) of Sub-S. (3) of that section speaks of:

    “ if the landlord or his son is not occupying for purposes of a business which he or his son is carrying on.”

    At first sight the impression the words give, is that actually carrying on business, is a condition. That is how Basheer Ahmed Sayeed, J., read them in C.R.P No. 137 of 1965. He observed:

    “ As a matter of fact it seems to me that the intention is to give this right of eviction only to such of the landlord as are actually carring on business aad who may require their own non-residential building in that connection and not to others who might have had a business or who might think of starting a future business.”

    If this view is accepted, nothing could be said against the validity of the exemption in question but, subsequently, at least three single Judges of this Court were not prepared to place that literal construction, but, at the same time, they did not go to the full length of saying that, short of any tangible concerete indication of commencement of a business, mere intention to carry on business will enable the landlord to resort to section 10 (3) (a) (iii) Ramaswami, J., in Civil Revision Petition No. 1891 of 1956 held that a preparation to do business would suffice to enable the landlord to invoke that provision. Panchapakesa Ayyar, J., in Nataroja Achari v. Balasubramaniam 19572 M.L.J 492., and Balasubramania Iyer C.J in Ramaswamy Pillai v. Karmega Thevar 1964 2 M.L.J 84., more or less subscribed to that view.

    On a careful consideration of the language employed by the section and particulary the words we have extracted and also the view of the several single Judges, we are of the view that while the literal construction placed by Basbeer Ahmed Sayeed, J., does not with due respect, commend itself to as, the other view appears to be reasonable. We think so because “carrying on a business” may consist of a series of steps, and, even if one step it proved, we do not see why the requirement is not satisfied. But, if there is no step at all whatever and the matter is only in the stage of intention, it is difficult to bring such a case within the phraseology of the statute. It follows, therefore, that the State Government was right in proceeding upon the basis that the landlord was yet to commence the business and, therefore, he could not have made use of section 10 (3) (a) (iii). The exemption order was, there-' fore, competent and does not suffer from any infirmity.

    Counsel for the appellant made an impassioned appeal to us that his client had been in the premises for many years and that he had invested large funds in his business and it would be a great hardship if he was evicted. But that in the particular circumstances of the exemption, may not be relevant. After all, what the tenant is entitled to is a statutory protection subject to the provisions of the statue, and, the Act, in our opinion, should be administered in such a way that it maintins balance between landlords and tenants, and, in cases of hardshlpt it is relieved, whereever it lies. In (1964) 2 M.L.J 89. this case the exemption was as we have already mentioned, grounded on the bonafide requirement of the landlord. It was suggested for the appellant that the landlord being only a poojari there was no bona fide in his claim that he required the premises for carrying on his business. We do not think that we can sit in judgment over the finding in this respect as in an appeal. In exercing the powers under section 29, it was open for the Authority to go into the question of bonafide. There is notbing unreasonable or perverse about the finding on the question of bonafide.

    The appeal is dismissed with costs. Counsel's fee Rs. 100.

    v.c.s

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    Comments

    P.N. Raju Chettiar v. State Of Tamil Nadu
    (Jun 25, 1969)