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Judgment Summary — Indermeet Kaur, J. (oral)

Factual and Procedural Background

This opinion concerns an order dated 19.7.2011 which dismissed an application for leave to defend filed by the tenant in a pending eviction petition instituted under Section 14(1)(e) of the Delhi Rent Control Act (DRCA). The eviction petition was filed by the landlord and owner, Sangeeta Kedia, who asserted a bona fide requirement of the disputed commercial premises (a shop/chabutra at 1855 Chandani Chowk, Delhi) for carrying on her business of stitching suits and other apparel. The landlord alleged she had carried on that business for eight years, had no other reasonably suitable accommodation in her name, and supported this claim with income tax returns and bills attached to the eviction petition.

The tenant disputed these facts in an application for leave to defend, advancing several contentions challenging (inter alia) the applicability of a Supreme Court precedent (Satyawati Sharma), the requirement of prior permission under Section 19 of the Slum Areas (Improvement and Clearance) Act, and the characterization of the landlord’s need (personal necessity, family dependence, or additional accommodation). The present judgment reviews those contentions and upholds the impugned order dismissing the tenant’s application for leave to defend.

Legal Issues Presented

  1. Whether the Supreme Court decision in Satyawati Sharma (supra), which struck down the discriminatory part of Section 14(1)(e) of the DRCA, applies where the premises are admittedly commercial and let out for commercial purposes.
  2. Whether the landlord was required to obtain prior permission under Section 19 of the Slum Areas (Improvement and Clearance) Act, 1956, before instituting an eviction petition under Section 14(1)(e) of the DRCA.
  3. Whether the landlord’s pleaded need is a bona fide personal necessity (for herself or family members/dependants) within the meaning of Section 14(1)(e) and the summary procedure of Section 25B, or whether it is an impermissible claim of additional accommodation giving rise to a triable issue.
  4. Whether the tenant’s factual contentions (e.g., that the landlord is only a housewife, or that the landlord failed to disclose from where she currently conducts business) raise triable issues entitling the tenant to leave to defend.

Arguments of the Parties

Tenant's Arguments (as summarised in the opinion)

  • The premises are commercial and were let for commercial purposes; therefore, the ratio of Satyawati Sharma (which concerned residential premises used for commercial purposes) is inapplicable.
  • The Satyawati decision only partially struck down Section 14(1)(e); the modified provision should be read narrowly and applied only to cases with its factual matrix; applying it more broadly would amount to judicial legislation (relying on P. Ramachandra Rao and State of Orrissa v. Md. Illiyas).
  • Prior permission under Section 19 of the Slum Areas (Improvement and Clearance) Act is mandatory and cannot be waived; Ravinder (Ravi) Dutt Sharma v. Ratan Lal Bhargava is said to be inapplicable.
  • The landlord’s averment that the premises are required for herself and dependants converts the claim into one not covered by the summary Section 25B procedure (i.e., it is not a 'personal necessity' and therefore should be tried as an ordinary eviction petition).
  • The landlord has not disclosed the place from where she presently conducts her business; she may already have adequate accommodation and the present claim may be for additional accommodation — earlier Supreme Court decisions (S.M. Mehra v. D.D. Malik; Santosh Devi v. Chand Kiran) were cited to argue that claims for additional accommodation raise triable issues deserving leave to defend.

Landlord's (Respondent's) Position (as presented in the petition)

  • The landlord, Sangeeta Kedia, pleaded a bona fide requirement of the premises to carry on her business of stitching suits and garments, stating she has been in that business for eight years.
  • The landlord asserted she has no other reasonably suitable accommodation in her name and the disputed shop (9 ft × 21 ft, ground floor, 1855 Chandani Chowk) is suitable and located in a commercial area appropriate for her business.
  • The landlord supported the claim with income tax returns and bills to substantiate that she has been conducting the business for several years.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Satyawati Sharma (Dead) by LRs. v. Union of India Struck down the discriminatory portion of Section 14(1)(e) of the DRCA that distinguished between premises let for residential and non-residential purposes, as violative of Article 14; read down Section 14(1)(e) so no such distinction remains. The court applied Satyawati to hold that no distinction can now be drawn between residential and non-residential premises for bona fide requirement under Section 14(1)(e), and rejected the tenant's contention that Satyawati is inapplicable to an admittedly commercial premises.
P. Ramachandra Rao v. State of Karnataka (2002) 4 SCC 578 Cited by the tenant to stress the distinction between judicial interpretation and legislation — i.e., the judiciary cannot legislate. The court rejected the tenant's reliance on this precedent, holding that striking down an offending statutory portion under constitutional review and severing it does not amount to legislating; P. Ramachandra Rao did not assist the tenant.
State of Orrissa v. Md. Illiyas (2006) 1 SCC 275 (AIR 2006 SC 258) Authority for the proposition that not every observation in a judgment is a binding precedent; only the ratio is binding. The court observed that this principle does not help the tenant's case and did not accept the tenant's attempt to limit Satyawati to a narrow factual matrix on that basis.
Ravinder (Ravi) Dutt Sharma v. Ratan Lal Bhargava (1984) 2 SCC 75 (AIR 1984 SC 967) Holds that the special procedure in Chapter III-A (as introduced by the 1976 amendment) removes the need for prior permission from the Competent Authority under Section 19 of the Slum Areas (Improvement and Clearance) Act before instituting an eviction petition under Section 14(1)(e). The court relied on this precedent (cited as authority) to reject the tenant's contention that Section 19 permission was mandatory in this context.
R.M.D. Chamarbaugwalla v. Union of India (AIR 1957 SC 628) Applies the severability doctrine: if the offending portion of a statute can be severed without doing violence to the remainder, severance is permissible. Cited (via Satyawati) as authority for severing the discriminatory part of Section 14(1)(e); the court accepted Satyawati’s severance approach as valid.
Bhawani Singh v. State of Rajasthan (1996) 3 SCC 105 Also cited in support of the severability principle. Relied upon (through Satyawati's reasoning) to support the view that the discriminatory portion could be severed and the remainder of Section 14(1)(e) sustained.
Prithipal Singh v. Satpal Singh (Dead) Through Its Lrs. (2010) 2 SCC 15 Discusses the scope and object of Chapter III-A and explains the legislative intent behind Section 25B — summary, expeditious procedure for landlords pleading bona fide personal requirement. The court cited and relied on the decision (and the quoted paragraphs) to reinforce the conclusion that Section 25B/Chapter III-A provides a complete code for summary eviction on bona fide requirement and justifies expedited relief.
Kewal Singh v. Smt. Lajwanti Authority upholding Section 25B and the classification of landlords entitled to the summary procedure; Section 25B not unconstitutional. The court referenced this decision to support the proposition that Section 25B constitutes a valid, constitutionally acceptable summary procedure for bona fide personal requirement evictions.
S.M. Mehra v. D.D. Malik (C.A. No. 120 of 1990, decided 11.01.1990) Cited by the tenant to contend that claims for additional accommodation raise triable issues and warrant leave to defend. The court distinguished this case on its facts and held it was not applicable to the instant case (finding the present case was not one of additional accommodation).
Santosh Devi v. Chand Kiran (2001) 1 SCC 255 Cited by the tenant for the proposition that additional accommodation claims may raise triable issues. The court found this decision factually distinct and inapplicable to the present dispute, and thus did not permit it to defeat the summary remedy under Section 25B.

Court's Reasoning and Analysis

The court's analysis proceeds from statutory interpretation, precedent, and the evidentiary material placed before the Rent Controller. The key steps in the reasoning are as follows:

  1. The court began by setting out the effect of Satyawati Sharma, observing that the Supreme Court struck down the discriminatory portion of Section 14(1)(e) (paras 38–39) which distinguished between premises let for residential and non-residential purposes. The court reproduced the adjusted formulation of Section 14(1)(e) as left after severance.
  2. Applying Satyawati, the court held that the discrimination between residential and non-residential premises for bona fide requirement under Section 14(1)(e) no longer exists. Consequently, the tenant's argument that Satyawati is confined to residential premises used for commercial purposes was rejected.
  3. The court addressed the tenant's contention that applying Satyawati broadly would amount to judicial legislation. It rejected this submission: the court explained that the power of constitutional courts to declare offending portions of statutes repugnant and sever them is an established remedial power and does not equate to legislating. The court relied on severability authorities quoted in Satyawati (R.M.D. Chamarbaugwalla and Bhawani Singh) to support this approach, and thus P. Ramachandra Rao and Mohd. Illiyas did not assist the tenant's cause.
  4. On the question of prior permission under Section 19 of the Slum Areas Act, the court followed Ravi Dutt Sharma v. Ratan Lal Bhargava and held that Chapter III-A's special procedure removed any requirement for the landlord to obtain that prior permission before instituting an eviction under Section 14(1)(e).
  5. Turning to the facts supporting the landlord's bona fide requirement, the court accepted the landlord's documentary material: income tax returns and bills showing she has been carrying on the business of stitching suits for eight years. Although the landlord had not stated from where she was then carrying on that business, the court found that the failure to disclose that address did not negate the bona fide need when documentary support existed and the disputed premises were in a highly commercial location suitable for the business.
  6. The court considered the tenant's submission that this was a case of additional accommodation (thus raising a triable issue). It distinguished the authorities relied upon by the tenant (S.M. Mehra and Santosh Devi) on their particular facts and held that acceptance of the tenant's argument would render the summary procedure in Section 25B nugatory. The court emphasized that Section 25B was intended as a summary remedy to avoid undue delays where bona fide personal requirement is shown.
  7. Having resolved the legal objections (interpretive and procedural) against the tenant and having accepted that the landlord had furnished credible documentary support for a bona fide requirement, the court concluded that the impugned order dismissing the tenant’s application for leave to defend contained no infirmity.

Holding and Implications

Core Ruling: The petition challenging the order dated 19.7.2011 is dismissed; the impugned order dismissing the tenant's application for leave to defend is upheld.

Implications:

  • Direct effect on the parties: The tenant's application for leave to defend remains dismissed and the landlord's eviction petition brought under Section 14(1)(e) / summary procedure of Section 25B is not impeded by the tenant's factual/contentional points as adjudged in this proceeding.
  • On precedent and law: The court applied and followed the Supreme Court's decision in Satyawati Sharma to hold that the discriminatory distinction between residential and non-residential premises under Section 14(1)(e) has been removed; it also confirmed that prior permission under Section 19 of the Slum Areas Act is not required where Chapter III-A procedure applies. The opinion does not purport to lay down a novel legal principle beyond applying extant Supreme Court authorities; no new legal precedent was announced by this court in the judgment.

Disposition: Petition dismissed.

    Budh Singh & Sons & Ors. Petitioners v. Sangeeta Kedia

    Indermeet Kaur, J. (Oral)— Order impugned before this Court is the order dated 19.7.2011 vide which the application for leave to defend filed by the tenant in a pending eviction petition under Section 14(1)(e) of the Delhi Rent Control Act (hereinafter referred to as the DRCA) had been dismissed.

    2. Record shows that the present eviction petition has been filed by the landlord and owner Sangeeta Kedia. This petition has been filed for a bonafide requirement. The bonafide requirement has been described in para 18(a) of the petition. It is stated that the petitioner is the owner and landlady of the premises. It is stated that for herself and her family members the premises is required bonafide for carrying on business. The petitioner is also doing business of stitching of suits in her own name for the last eight years. She has no other reasonable suitable accommodation for carrying on the said business. This premises is located in a commercial area and is suitable for the business of the petitioner; she has no other accommodation in her name; she has bonafide requirement for the purpose noted hereinabove.

    3. The premises is comprised of a Chabutra at 1855 Chandani Chowk, Delhi. In the application for leave to defend these facts are disputed.

    (i) The first contention raised by the petitioner/tenant which as per him has amounted to a triable issue is that the premises in this case are commercial premises; purpose of letting out was commercial; as such Section 14(1)(e) even in view of the judgment of the Apex Court 148 (2008) DLT 705 (SC), Satyawati Sharma (Dead) by LRs. v. Union of India. is not applicable. His contention being that the facts of Satyawati (supra) were peculiar to their own factual matrix; that was a case where the premises were residential premises and the tenant was using it for a commercial purpose; in this scenario the Apex Court had noted that no distinction can be drawn between a residential and a commercial premises; in this case the premises which were admittedly commercial had been let out for a commercial purpose; the judgment of Satyawati is not applicable.

    (ii) Learned counsel for the petitioner has further submitted that the Apex court in the case of Satyawati (supra) while holding that certain part of the provisions of Section 14(1)(e) of the DRCA is violative of Article 14 of the Constitution of India had only in part deleted Section 14(1)(e) of the DRCA; it is not as if the whole provision of Section 14(1)(e) had been deleted; submission being that this modified Section 14(1)(e) of the DRCA has to be read in the context of the facts of that particular case only; it is a precedent which precedent is applicable to its own factual matrix; alternate submission being that in case this court is of the view that this is applicable in a larger and wider form and applicable to other cases as well, it would amount to a legislation which the courts are not permitted to do. In support of this submission he has placed reliance upon a judgment of the Apex Court (2002) 4 SCC 578, P Ramachandra Rao v. State of Karnataka; submission being that a clear distinction should be made between a legislation and a precedent; further submission being that the judiciary is required only to interpret the law; it may lays down guidelines and principles but it cannot in any manner legislate. Reliance has also been placed upon a judgment (2006) 1 SCC 275 : AIR 2006 SC 258, State of Orrissa v. Md. Illiyas to support his submission that it is not everything said by a judge while giving a judgment that constitutes a precedent; the findings in such decision i.e the ratio alone is applicable and the enunciation of the reason or principle on which a question before the court has been decided is alone binding as a precedent; submission being that the judgment of Satyawati is applicable to the facts of those cases only where the premises were residential but were being used for a commercial purpose and not in the instant case where the premises admittedly were commercial and had been permitted to be used for a commercial purpose. This has raised a triable issue.

    (iii) Next submission is that necessary permission under Section 19 of the Slum Areas (Improvement and Clearance) Act 1956 is also mandatory; that condition also could not be waived. Judgment of Ravinder Dutt Sharma v. Ratan Lal Bhargava, (1984) 2 SCC 75 : AIR 1984 SC 967 has no application to the facts of this case. The impugned order holding that that no such permission is required is an erroneous finding; this in fact raises a triable issue.

    (iv) The further submission of learned counsel for the petitioner is that the landlady in her ground for eviction has stated that the premises are required for herself and her dependants; where the bonafide need is for the family members and dependants the procedure contained in Section 25 B of the DRCA is not available and the petition under Section 14(1)(e) of the DRCA has to be tried as an ordinary eviction petition as it is not a ‘personal necessity’.

    (v) Last submission of the learned counsel for the petitioner is that there is no bonafide need of the petitioner; the petitioner has not disclosed the place from where she is doing her business, which was incumbent upon her to do so; she has admittedly been carrying on business from somewhere and the accommodation now sought by her is an additional accommodation; in cases based on need for an additional accommodation the Supreme Court has time and again reiterated that it raises a triable issue and unconditional leave to defend should be granted. To support this submission reliance has been placed upon a judgment of Apex Court in S.M Mehra v. D.D Malik, C.A No. 120 of 1990 decided on 11.01.1990 and also upon a judgment (2001) 1 SCC 255, Santosh Devi v. Chand Kiran CA No. 412 of 2000 decided on 17.01.2000 Submission of the petitioner is that all these are triable issues which have not been dealt with by the Additional Rent Controller in its correct prospective.

    4. Record has been perused.

    5. The Supreme Court in the case of Satyawati (supra) has struck down a certain part of provision of Section 14(1)(e) of the DRCA as being violative of the doctrine of equality embodied in Article 14 of the Constitution of the India and in paras 38 and 39 they are noted herein in below:

    “38. In view of the above discussion, we hold that Section 14(1)(e) of the 1958 Act is violative of the doctrine of equality embodied in Article 14 of the Constitution of India insofar as it discriminates between the premises let for residential and non-residential purposes when the same are required bona fide by the landlord for occupation for himself or for any member of his family dependent on him and restricts the latter's right to seek eviction of the tenant from the premises let for residential purposes only.

    39. However, the aforesaid declaration should not be misunderstood as total striking down of Section 14(1)(e) of the 1958 Act because it is neither the pleaded case of the parties nor the learned counsel argued that Section 14(1)(e) is unconstitutional in its entirety and we feel that ends of justice will be met by striking down the discriminatory portion of Section 14(1)(e) so that the remaining part thereof may read as under:-

    “that the premises are required bona fide by the landlord for himself or for any member of his family dependent on him, if he is the owner thereof, or for any person for whose benefit the premises are held and that the landlord or such person has no other reasonably suitable accommodation.”

    While adopting this course, we have kept in view well recognized rule that if the offending portion of a statute can be severed without doing violence to the remaining part thereof, then such a course is permissible R.M.D Chamarbaugwalla v. Union of India, AIR 1957 SC 628 and Bhawani Singh v. State of Rajasthan, (1996) 3 SCC 105.

    6. As a sequel to the above, the explanation appearing below Section 14(1)(e) of the 1958 Act will have to be treated as redundant.”

    7. It is thus clear that the discrimination on the purpose of letting out of a premise for a residential or a non-residential purpose has been struck down; the remaining part of Section 14(1)(e) of the DRCA (after a portion of it having been struck down) has also been reproduced supra. It is thus clear that now no distinction can be drawn between premises let out for a residential purpose or a non-residential purpose where the landlord seeks eviction on the ground of bonafide requirement as contained in Section 14(1)(e) of the DRCA. The submission of the learned counsel for the petitioner that this judgment is not applicable to the facts of his case is rejected.

    8. The further submission of the learned counsel for the petitioner that the deletion of the part of Section 14(1)(e) of the DRCA is restricted in its applicability and would apply only to premises which were residential and had been given for commercial purpose, as noted supra, has been rejected; the alternate submission of the petitioner on this count is that if Section 14(1)(e) of the DRCA is to be read in wider perspective it would amount to legislating which the Courts are not permitted to do; and for this proposition he has placed reliance upon a judgment of the Supreme Court P Ramachandra Rao (supra); this argument is meritless. The powers of the constitutional authority to declare as repugnant a part of a statute which is violative and offending to the constitutional provisions is an unbridled power of the High Court and Supreme Court and by striking down a part of the provision of the offending statute it in no manner amounts to legislating as is the contention of the petitioner. This argument is not only ill founded but is hopelessly misguided. The Apex Court in the case of Satyawati (supra) had in fact quoted with approval its earlier pronouncements on this issue in the judgments AIR 1957 SC 628, R.M.D Chamarbaugwalla v. Union of India and (1996) 3 SCC 105, Bhawani Singh v. State of Rajasthan. As such the judgments of P Ramachandra Rao and Mohd. Illiyas (supra) do not come to the aid of the petitioner.

    9. The Supreme Court in Ravi Dutt Sharma (supra) had held that the special procedure contained in Chapter III-A as introduced in the Rent Act by the amendment Act 1976 makes it no longer a requirement of the landlord to obtain a permission from the Competent Authority under Section 19 of the Slum Area (Improvement and Clearance) Act, 1956 before instituting an eviction petition under Section 14(1)(e) of the DRCA. The submission of the learned counsel for the petitioner on this score is also accordingly rejected.

    10. The eviction petition has also clearly and categorically disclosed the bonafide need of the landlady Sangeeta Kedia. It has come on record that she is carrying on business since the last eight years and this has been supported by her income tax returns which had been filed along with the eviction petition as also the bills supporting her submission that she is carrying on the business of stitching of suits and other apparel. There is no doubt that on this eviction petition it has not been mentioned from where she is carrying on the said business; her need for the present premises (which is a shop measuring 9 feet × 21 feet on the ground floor of premises bearing No. 1855, Chandani Chowk, Delhi) is for running the business of ladies suits and garments which she is admittedly carrying on and is supported by her documents as aforenoted. In this factual scenario the submission of the tenant that the petitioner is only a housewife and is not doing any business is negatived. The premises in occupation of the respondent is also admittedly in a highly commercial area i.e in the heart of the Delhi being on the main road of Chandani Chowk; the petitioner has also averred (unchallenged) that she has no other properties in her name and thus admittedly this disputed premises (being in a commercial area) from where she wishes to carry a business of ladies suits and garments would definitely be a viable and profitable business venture for her; her Todar Mal residence where she is residing is admittedly residential. In these circumstances mere fact that the landldady has not disclosed the address from where she is carrying on this business would not diminish her bonafide need.

    11. The present case is also not a case of additional accommodation. The judgment of S.K Mehra (supra) and Santosh Devi (supra) were distinct on their facts. In the first case the landlord was occupying the ground floor as also entire second floor; the question was whether the landlord required the first floor as well. In the second case the landlady was in the possession of the first floor; certain additional accommodation was thereafter subsequently made available to the landlady; it was in these circumstances that the court thought it fit as being described as a case of additional accommodation for which a trial would be required. From these judgments relied upon by the petitioner are half page judgments; further facts cannot be deciphered; each case even otherwise has to be weighed in its own context. In fact if the submission of the learned counsel for the petitioner on this score is accepted, all cases where the landlord is living even in a one room tenement owned by him would become a case of additional accommodation raising a triable issue and leave to defend should have to be granted and to which query the leaned counsel has no answer. To say the least, this argument is wholly misplaced; this was definitely not the intent and purpose of the Legislature while engrafting the provisions of Section 14(1)(e) of the DRCA which has to be read with Section 25 B of the DRCA wherein it has been reiterated time and again by the Apex Court that this is a summary procedure which is available for effective and summary disposal of an eviction petition filed by the landlord on the ground of a bonafide need either for himelf or any member of his family dependent upon him. In fact if this argument of the learned counsel for the petitioner is accepted this entire procedure would have to be given a go by; this argument is thus rejected. The language of this Section also clearly states that the need may be of the landlord or any member of his family dependent upon him and the landlord or such person has no other reasonably suitable accommodation.

    12. In the judgment of Prithipal Singh v. Satpal Singh (Dead) Through Its Lrs.. (dead) through legal heirs, (2010) 2 SCC 15 the Apex Court has noted herein as below:-

    “20. The scope of Chapter III-A of the Rent Act has been elaborately discussed in Ravi Dutt Sharma v. Ratan Lal Bhargava in which this Court duly discussed the object of the Rent Act and also the insertion of Chapter III-A of the same in the following manager:

    The dominant object of the act is to provide a speedy, expeditious and effective remedy for a class of landlords contemplated by sections 14(1)(e) and 14a and for avoiding unusual dilatory process provided otherwise by the Rent Act. It is common experience that suits for eviction under the Act take a long time commencing with the Rent Controller and ending up with the Supreme Court. In many cases experience has indicated that by the time the eviction decree became final several years elapsed and either the landlord died or the necessity which provided the cause of action disappeared and if there was further delay in securing eviction and the family of the landlord had by then expanded, in the absence of accommodation the members of the family were virtually thrown on the road. It was this mischief, which the Legislature intended to avoid by incorporating the new procedure in Chapter III-A. The Legislature in its wisdom thought that in cases where the landlords required their own premises for bona fide and personal necessity they should be treated as a separate class along with the landlords covered by Section 14(A) and should be allowed to reap the fruits of decrees for eviction within the quickest possible time. It cannot, therefore, be said that the classification of such landlords would be an unreasonable one because such a classification has got a clear nexus with the objects of the Amending Act and the purposes, which it seeks to subserve. Tenants cannot complain of any discrimination because the Rent Act merely gave certain protection to them in public interest and if the protection or part of it afforded by the Rent Act was withdrawn and the common law right of the tenant under the Transfer of property Act was still preserved, no genuine grievance could be made.

    …………………..

    22. A challenge was thrown to section 25b of the rent act in Kewal Singh v. Smt. Lajwanti, questioning the classification held to be not in consonance with the objective sought to be achieved and the aforesaid provision must be held to be unconstitutional wherein this Court held that the special provision namely, section 25b of the rent act providing summary procedure for eviction while the landlord pleading bona fide personal requirement, separate classification of such landlords were held to be justified as such classification must be held to be in consonance with the objective sought to be achieved and provision not unconstitutional. Accordingly, in the aforesaid decision, this Court held that Section 25B does not suffer from excessive delegation. Keeping in view the aforesaid observations of this Court in this case and considering the special provisions made in Section 25B of the Act, we conclude that Section 25B of the Act is a complete code by which the entire procedure to be adopted for eviction of a tenant on the ground of bona fide requirement filed by the landlord in respect of a premises, shall be followed.”

    13. In the instant case impugned order dismissing the application for leave to defend suffers from no infirmity.

    14. Petition is without any merit. Dismissed.

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    Budh Singh & Sons & Ors. Petitioners v. Sangeeta Kedia
    (Nov 17, 2011)