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A.S Mani (Deceased) ... v. M/S. Udipi Hari Niwa...
Factual and Procedural Background
Three tenants (the petitioners before the Court) occupy the front portion of commercial premises bearing No. 111, Wall Tax Road, Park Town, Madras 600003. The landlord, a partnership concern, conducts a coffee hotel in the rear portion and operates a lodging house on the first floor. The landlord filed separate eviction petitions against each tenant under Sec. 10(3)(c) of the Tamil Nadu Buildings (Lease and Rent Control) Act, claiming a bona fide requirement of the tenants' portions as additional accommodation to expand the hotel and lodging business, citing narrow access, insufficient frontage and inability to accommodate increasing business. Notices to vacate were issued in 1980 and 1983; earlier eviction petitions were dismissed on technical/ex parte grounds, which the landlord contended did not bar the present petitions.
The Rent Controller, after considering oral and documentary evidence, concluded the landlord required the premises bona fide under Sec. 10(3)(e) of the Act and ordered eviction. The Rent Control Appellate Authority confirmed eviction under Sec. 10(3)(c). The tenants filed revision petitions against those orders.
Legal Issues Presented
- Whether the landlord has a bona fide requirement of the petition premises as additional accommodation within the meaning of Sec. 10(3)(c) of the Tamil Nadu Buildings (Lease and Rent Control) Act.
- Whether earlier dismissal(s) of eviction petitions filed by the landlord operate as res judicata to bar the present petitions.
- Whether the hardship to the tenants, if evicted, outweighs the advantage the landlord would obtain by regaining the premises (i.e., proportionality of eviction remedy considering competing interests).
Arguments of the Parties
Tenants' Arguments
- The earlier dismissal of the landlord's eviction petitions operates as res judicata and therefore bars the present petitions.
- The tenants deny an agreement to vacate on 1.7.1984; only legal heirs of one tenant vacated earlier for unrelated compliance reasons.
- The space occupied by the tenants is not genuinely required for the landlord's business expansion; the landlord's business has not truly progressed despite assessments, and any apparent increase is attributable to currency depreciation rather than real growth.
- The landlord only asserted a need for additional accommodation in notices from 1983, not in the 1980 notices; the true motive is to re-let for higher rent/advance.
- The staircase and access are adequate (asserted 6 feet width), and the passage and entry can be used; the proposed structural alterations would be impracticable or dangerous given the building's age (50 years), with expert evidence (D.W.4) that removal of dividing walls or contemplated alterations could cause collapse.
- Attraction of customers is not a valid ground under Sec. 10(3)(c); eviction would cause hardship because the tenants are petty shopkeepers relying on these premises and may have no viable alternative accommodation.
- The evidence relied upon by the landlord (including R.W.2's testimony and the landlord's witnesses) is self-interested or insufficient; the Advocate Commissioner's report allegedly shows further improvements are not possible.
Landlord's Arguments
- The landlord's coffee hotel (rear) and lodging house (first floor) are experiencing increasing business, demonstrated by sales-tax assessment orders (Exs.P-1 to P-10), and require additional accommodation to serve more customers.
- The tenants occupy the front portion, which is necessary for frontage, widening access and staircases—without which customers cannot conveniently access the hotel and lodging house with luggage.
- The earlier petitions were not finally heard and decided (many were ex parte), so res judicata does not apply.
- Engineering and Advocate Commissioner's assessments support the feasibility of making necessary alterations and the bona fide requirement for expansion.
- Tenants are petty business operators who can find alternative accommodation in the same locality; the landlord's prospective advantage outweighs tenants' hardship.
- Both authorities below concurrently found bona fide requirement under Sec. 10(3)(c); their concurrent findings merit no interference.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Hameedia Hardware Stores v. Mohan Lal Sowcar, A.I.R. 1988 S.C. 1060 (1988 1 J.T. 664) | Principle that a landlord seeking additional accommodation must show that he deserves it (i.e., prove bona fide requirement). | The Court applied this principle and concluded, on the facts and documentary evidence (sales-tax assessment orders, location and access problems, expert evidence and Advocate Commissioner's report), that the landlord had established he "deserved" to be put in possession under Sec. 10(3)(c) of the Act. |
Court's Reasoning and Analysis
The Court conducted a fact-based appraisal of the evidence adduced before the Rent Controller and the Appellate Authority and reasoned as follows:
- Evidence of business improvement: The landlord produced sales-tax assessment orders (Exs.P-1 to P-5 for 1971–1977 and Exs.P-6 to P-10 for 1982–1984). The Rent Controller relied on Exs.P-1 to P-4 to find business improvement. The tenants' contention that the increase resulted solely from the falling value of the rupee was rejected by the Court, which accepted that sale turnovers demonstrate genuine increase. One tenant witness (R.W.2) conceded that the landlord's business was improving.
- Commercial viability and location: The Court emphasized the premises' commercial character and proximity to Central Railway Station (Wall Tax Road), reasoning that this location makes expansion commercially viable for both hotel and lodging customers.
- Access, frontage and structural alteration issues: The landlord established that the tenants' shops on the front portion restricted access to the hotel in the rear and the narrow staircase hindered customers reaching the lodging portion. While there were conflicting engineering opinions—landlord's engineer (P.W.2) opining that joining the portions and providing suitable pillars was possible under modern architecture, and tenants' engineer (D.W.4) opining that, given the building's age (50 years), the proposed alterations might cause collapse—the Court held that how the landlord would improve the building was not the tenants' concern for assessing bona fides. The Court also referenced the Advocate Commissioner's report as supportive of improvement being feasible.
- Res judicata: The Court analyzed the tenants' res judicata plea and concluded that the prior dismissals were ex parte orders and not finally heard and decided by a competent court; thus res judicata did not apply to bar the present petitions.
- Balancing hardship: The Court considered the relative hardships and concluded that tenants, operating petty businesses (saloon, laundry, general store), could find alternative accommodation in the same area and that the landlord would suffer significant disadvantage if additional accommodation were not granted. Both authorities below had made concurrent findings that the landlord's prospective benefit outweighed tenants' hardship; the Court declined to reappraise and interfere with those concurrent findings.
- Application of binding precedent: The Court applied the Supreme Court's pronouncement in Hameedia Hardware Stores (supra) that a landlord must show he "deserves" additional accommodation. Finding the evidential record adequate, the Court concluded the landlord satisfied that standard.
- Disposition and remedial directions: Given the concurrent findings and the Court's inability to come to a different conclusion on reappraisal, the revision petitions were dismissed. The Court additionally granted tenants four months to vacate the premises from the date of the order (19.10.1995), conditional on filing an affidavit of undertaking within four weeks; failure to file would vacate the extended time.
Holding and Implications
Holding: All revision petitions filed by the tenants were dismissed and the eviction orders passed by the Rent Controller and the Rent Control Appellate Authority under Sec. 10(3)(c) of the Tamil Nadu Buildings (Lease and Rent Control) Act were upheld.
Implications:
- Direct effect on the parties: The tenants are required to vacate the premises within four months from 19.10.1995, subject to the condition that they file an affidavit of undertaking within four weeks from that date; failure to do so will vacate the time granted.
- No new legal precedent was announced by this Court beyond application of the existing Supreme Court authority (Hameedia Hardware Stores). The decision affirms the concurrent factual findings of the lower authorities that the landlord established a bona fide requirement for additional accommodation under Sec. 10(3)(c).
- The Court imposed no costs and also dismissed related miscellaneous applications (C.M.P Nos. 16845 to 16847 of 1993) as consequential to the dismissal of the revision petitions.
1. The three tenants are the petitioners herein. The landlord is a partnership concern. The landlord filed petition for eviction against each of the tenants under Sec. 10(3)(c) of the Tamil Nadu Buildings (Lease and Rent Control) Act. The petition premises is situated at No. 111, Wall Tax Road, Park Town, Madras 600003. According to the landlord, in the upstairs portion on the front side, the tenants are in occupation. On the rear side of the building, the landlord is carrying on business by running a coffee hotel. In the first floor, the landlord is also conducting a lodging house. Both the businesses are increasing periodically. For the purpose of expanding the business run by the landlord, the portion in the occupation of the tenants are required by way of additional accommodation. Since there is insufficiency of space, the landlord is compelled to reduce his customers. Considering the nature of the business run by the landlord, the front portion would be of much advantage. Since the tenants are in occupation of the front portion of the building, it is of great disadvantage to the landlord. There was only one way leading to the lodging house being conducted in the first floor. In fact, the customers used to come inside the building and go through the stairs to the first floor. Since the customers are going through a narrow lane to reach the upstairs, the front portion would be of much advantage. It is also difficult for the customers to take their belongings and luggages to the lodging portion. Since the entrance is narrow and since there is no sufficient light, it is not possible to expand the entrance. Hence, the landlord requires the petition premises under the occupation of the tenants bona fide by way of additional accommodation. The tenants can be shifted to various places and that would not affect them. The advantage the landlord may get would out-weigh the disadvantage the tenants may incur if eviction is ordered. The landlord is not carrying on any other business except the hotel business which is conducted in the petition premises. The landlord is entirely depending upon the said business for his family life. If the petition premises is not used by way of additional accommodation, the business of the landlord would get affected. Notices were issued to the tenants in the year 1980 and 1983 calling upon them to vacate the petition premises, but they refused to do so. Earlier petitions filed for eviction against the tenants were dismissed but on technical grounds. Therefore, the order passed in the earlier petitions would not operate as res judicata. The tenants assured that they would vacate the premises on 1.7.1984 But, they did not do so. In the earlier proceedings, some of the tenants vacated the petition premises. But, the respondents herein have refused to vacate the petition premises and hence the petitions.
2. The common defence put forward by the tenants in their common counters are as under. The earlier dismissal of the petitions filed by the landlord would operate as res judicata in filing the present petition for eviction. It is not correct to state that the petitioners herein along with other tenants agreed to give vacant possession on 1.7.1984 as alleged by the landlord. Only the legal heirs of one tenant vacated the petition premises. They have vacated the premises as they have not complied with the orders passed in a petition filed under Sec. 11(4) of the Act. The portion in occupation of the tenants would not be sufficient for the landlord to expand his business. The landlord is conducting his hotel and lodging business for the past more than 16 years. But, there is no progress in the business. The insufficiency of the space is not the reason. The space is sufficient for the landlord to serve the needs of his customers. There are several other coffee hotels in that area. The business of the landlord has no chance to expand. In the notice sent in the year 1980, the landlord has not stated that they require the portions in the occupation of the tenants by way of additional accommodation. Only in the year 1983, the landlord sent a notice stating that he requires the portions in their possession for his additional accommodation. The landlord is trying to vacate the tenants with a view to let out the premises for higher rents and for higher advance. It is not necessary for the landlord to conduct business in the ground floor, portion of the premises. The staircase leading to the first floor is with a width of 6 feet and not of 4 feet. The staircase can be used conveniently by the people who are coming to the hotel as well as to the lodging house. The hotel is not in the rear portion as alleged by the landlord. The landlord is also earning income from other ways. There is no other alternative place to the tenants if eviction is ordered. That would cause hardship to the tenants. In the petition premises, the tenants are carrying on the business for the past many years. The landlord requires higher rent and higher advance amount to which the tenants are not agreeable. The allegations made in the present eviction petition are contrary to the allegations contained in the earlier petitions.
3. After hearing the learned counsel for the landlord and the tenants and after considering the evidence both oral and documentary, the Rent Controller came to the conclusion that the landlord required the petition premises bona fide under Sec. 10(3)(e) of the Act. Accordingly, eviction was ordered.
4. On appeal, the Rent Control Appellate Authority confirmed the order of eviction passed by the Rent Controller under Sec. 10(3)(c) against each of the tenants. It is against these orders, the present revisions are filed by the tenants.
5. Learned counsel for the petitioners/tenants submitted under: The findings of the authorities below are not supported by any materials. The findings given by the courts below are perverse. The petition filed by the landlord is barred by res judicata in view of the dismissal of the earlier petitions filed by the landlord. There is no bona fide on the part of the landlord in requiring the petition premises under Sec. 10(3)(c) of the Act. The notices issued by the landlord in Exs.P-11 and P-13 and the dismissal of the earlier rent control petitions filed by the landlord would show that there is no bona fide on his part in requiring the petition premises. The assessment orders Exs.P-1 to P-4 of the Sales Tax Department for the period 1971-1974, 1975 and 1976 would go to show that there is no improvement in the business conducted by the landlord. The increase in the volume of the business as shown by the landlord is due to the reduction in the value of rupee. Only R.W.2 admitted that the business of the landlord increased. All other witnesses did not agree with the evidence of R.W.2 in this respect. The purpose for additional accommodation for securing better Access to the respondents portion is not a requirement contemplated under Sec. 10(3)(c) of the Act. The building is 50 years old. The dividing walls could not be removed without demolishing the building. The walls can be removed, if the age of the building. The walls can be removed, if the age of the building is below 25 years that too with the support of the poles holding ceiling. Evidence, of R.W.4 to the effect that the alterations as contemplated by the respondents in the petition premises would cause the collapse of the building. Therefore, Ex.R-2 the report and Ex.R-3 plan of the engineer cannot be acted upon. The observation of the appellate authority that the alterations can be made without causing any damage to the petition premises is without any basis. The petition premises cannot be made to bear extra loading. The report of the Advocate Commissioner appointed by the appellate court would go to show that further improvement is not possible in the petition premises. Attracting customers cannot be a ground for asking additional accommodation. The tenants are carrying on business from 1970 onwards. The petition premises is in the same condition as it was before. It is not correct to state that if eviction is ordered, that would cause hardships to the tenants. The self-interested testimony of P.W.1 cannot be a ground for ordering eviction. The petitioners are petty shop keepers one running general store, another running laundry and the other running a hair cutting saloon and they have to support their families with the small income from their business. For these reasons, it was submitted that the order of eviction passed by the authorities below is liable to be set aside.
6. Learned counsel for the landlord submitted as under: The landlord is conducting coffee hotel and lodging business. The coffee hotel is on the rear side of the building. The tenants are in occupation of the front portion. According to the landlord, his business is now increasing and he wants to accommodate more customers. It is stated that the entrance to the main building and the stair case is very narrow and unless they are widened, it is not possible for the customers to reach the upstairs with their luggages. Insofar as the earlier petitions are concerned, they will not operate as res judicata since those matters were not finally heard and decided. The sales-tax assessments would go to show that the business of the landlord is increasing periodically. The report filed by the Advocate Commissioner would clearly go to show that the landlord requires additional accommodation for the expansion of the business. It is not correct to state that the landlord requires higher rent and advance from the tenants. It is not open to the tenants to say that the place required by the landlord by way of additional accommodation is not sufficient or not suitable for the business of the landlord. The tenants are running petty businesses and even if they are evicted they can find alternative accommodation in the same locality. Therefore, the advantage the landlord can get would out-weigh the hardship that can be caused to the tenants if an order of eviction is passed. For all these reasons, it was submitted that both the authorities concurrently held that the landlord established the bona fide requirement under Sec. 10(3)(c) of the Act. Since the orders passed by the authorities below are concurrent no interference is called for.
7. I have heard learned counsel for the tenants and also the learned counsel for the landlord. The fact remains that the three petitioners are the tenants in respect of the petition premises bearing No. 111, Wall Tax Road, Madras. They are conducting petty shop business like saloon, laundry and general stores. The tenants are in occupation of the front portion of the building. The landlord is carrying on his coffee hotel business in the rear portion. The upstairs portion is being used as lodging house. There is a narrow staircase leading to the first floor. According to the landlord, the portion in the occupation of the tenants are required for additional accommodation, under Sec. 10(3)(c) of the Act. According to the landlord, the hotel business and the lodging business are going on improving. In order to support this contention, the landlord has filed sales tax assessment orders, which are marked as Exs.P-1 to P-5 relating to the assessment years 1971 to 1977. Exs.P-6 to P-10 are the assessment orders relating to the years 1982 to 1984. Learned Rent Controller divided that the business of the landlord improved on the basis of Exs.P-1 to P-4. According to the tenants, the landlord is getting higher income because the value of the money has gone up. This contention put forward by the tenant cannot be accepted. Whatever may be value of rupee, the increase in the business has been established from the sale turnovers shown by the landlord. In fact, one of the tenants R.W.2 accepted that the business of the landlord is improving. According to the tenants, the building is situated in such a place that there is no room for expansion of the business run by the landlord. The authorities below pointed out that the petition premises situated in Wall Tax Road, near the Central Railway Station. Therefore, the landlord can get more business in his coffee hotel as well as in the lodging house.
8. According to the landlord, since the ground portion is occupied by the tenants, it is not possible for the landlord to attract more customers. It is pointed out that the way leading to the coffee hotel which is in the rear portion of the building is very narrow as on both the sides the shops of the tenants are situated. Therefore, the authorities below came to the conclusion that the existence of the shops of the tenants are really affecting the business of the landlord. According to the tenants, without demolishing the petition premises, it is not possible for the landlord to open the hotel with frontage. The landlord examined his engineer P.W.2 who informs that it is possible under the modern architecture to join both the portions without demolishing the existing structure. If the walls of the petition premises are removed, then the hotel hall would become the part of the front portion. They require only pillars to safeguard the terrace portion. The tenants also examined an engineer as D.W.4 According to him, since the building is of 50 years old, the method suggested by the landlord's engineer is not possible. But, how the landlord would improve his building for the purpose of expanding his business is not the concern of the tenants. The landlord wants the petition premises for the expansion of his business and he will do it by possible methods. On that we have to see as to whether there is any bona fide in the requirement of the landlord. The landlord has increased his business and the present place is not sufficient to meet the increasing business. For that purpose he also wants the frontage also. Along with the hotel portion, if only the dividing wall is removed, the landlord would get the front portion for the purpose of his hotel and that would attract more customers to his business. The landlord has also shown that the passage leading to the rear portion is very narrow and the staircase leading to the first floor is also very narrow. If these are not expanded, it is not possible for the landlord to attract more customers. It is also pointed out that the petition premises in No. 111, Wall Tax Road, is a prime commercial area from where the landlord can get more customers as the same is situated very near to the Central Railway Station. Therefore, the landlord has established his bona fide in requiring the petition premises. As per the decision of the Supreme Court in Hameedia Hardware Stores v. Mohan Lal Sowcar, A.I.R 1988 S.C 1060: 1988 1 J.T 664, it was pointed out that the landlord seeking additional accommodation must show that he deserves it. On the facts available in the present case, the landlord has established that he deserved to be put in possession of the petition premises under Sec. 10(3)(c) of the Act.
9. One other submission raised by the tenant was that the landlord had filed earlier petitions for eviction and those petitions were dismissed and that therefore, the orders passed in those petitions would operate as res judicata. In order to apply the principle of res judicata, the earlier decision should be one made by a competent court after finally heard and decided. According to the facts available on record, the earlier decisions are ex parte orders. Therefore, they were not finally heard and decided by the competent court. Hence, the earlier orders passed on the eviction petitions filed by the landlord cannot operate as res judicata.
10. Insofar as the hardship is concerned, the tenants are conducting only petty shops and they can find out alternative accommodation in the same area for carrying out their business. The landlord is carrying on business and the same is increasing. If the space of the business is not extended, the landlord would lose his additional income. Further, if the additional accommodation is not given, the landlord's business would get lot of disadvantages. Therefore, both the authorities below concurrently held that the benefit the landlord may get would out-weigh the hardship that the tenants may get if the eviction is ordered. Therefore, on a careful appraisal of the facts available in the case the authorities below have passed the eviction order concurrently. On a re-appraisal of the same facts, it is not possible for this Court to come to a different conclusion. Accordingly, I am not inclined to interfere with the order of eviction passed by the authorities below concurrently in the case of each of the tenants. In this view of the matter, all these revision petitions are dismissed. No costs. Consequently, C.M.P Nos. 16845 to 16847 of 1993 are also dismissed.
11. At the time of delivering the order, the learned counsel appearing for the petitioners/tenants requests time for vacating the premises. After hearing the learned counsel for the landlord as well as the tenants, four months' time from today (19.10.1995) is granted to the tenants/petitioners for vacating the premises, on condition that the tenants/petitioners should file an affidavit of undertaking to that effect within four weeks from today (19.10.1995); failing which the time granted herein shall stand vacated.
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