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AMICUS AI
Citation Codes
Neutral Citations
1989 INSC 49
Equivalent Citations
citation codes
Case Number
Disposition
Advocates
Judges
Acts
  • Section 27 of the said Act
  • Section 21(1)(j), Karnataka Rent Act
  • Sections 27 and 28, Karnataka Rent Act
  • Section 5, Subsection 2 of the 1983 Income Tax Act
  • Section 21(1)(j) of the Karnataka Rent Act
  • Sections 27 and 28 of the Karnataka Rent Act
  • Section 27 of the Karnataka Rent Act
  • Section 28 of the said Act
  • Section 21(1)(j) of the Karnataka Rent Control Act, 1961
  • Section 21 of the Karnataka Rent Act
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Cites
Cited by
Citation Codes
Neutral Citations
1989 INSC 49
Equivalent Citations
citation codes
Case Number
Disposition
Advocates
Judges
Acts
  • Section 27 of the said Act
  • Section 21(1)(j), Karnataka Rent Act
  • Sections 27 and 28, Karnataka Rent Act
  • Section 5, Subsection 2 of the 1983 Income Tax Act
  • Section 21(1)(j) of the Karnataka Rent Act
  • Sections 27 and 28 of the Karnataka Rent Act
  • Section 27 of the Karnataka Rent Act
  • Section 28 of the said Act
  • Section 21(1)(j) of the Karnataka Rent Control Act, 1961
  • Section 21 of the Karnataka Rent Act
Smart Summary

Factual and Procedural Background

Respondent 1, the landlord, owned a building in Bangalore comprising four ground-floor shops facing Belepet Main Road and four first-floor offices. The appellant occupied one of the street-facing shops measuring 9′ × 17′. Seeking to demolish and reconstruct the building, Respondent 1 filed eight eviction petitions under Section 21(1)(j) of the Karnataka Rent Control Act, 1961 (“the Act”). In the petition against the appellant, the landlord expressly offered to re-accommodate each tenant in a “corresponding” portion of the new building.

The appellant consented to an eviction decree, delivered the key, and the trial court passed a decree under Section 21(1)(j). While reconstruction was underway, the appellant served notice under Section 27, expressing his intent to occupy the corresponding shop and to pay fair rent.

Meanwhile, Respondent 1 appealed, asserting that a consent decree was impermissible under Section 21(1)(j). The First Additional District Judge allowed the appeal. Immediately thereafter, Respondent 1 inducted K. Gopal Krishna (now Respondent 2) into a newly built 9′ × 16′ street-facing shop roughly corresponding to the appellant’s original premises.

The appellant’s revision to the High Court succeeded. The High Court affirmed the validity of the original eviction decree and held that the rights of any new tenant (Respondent 2) were subordinate to the statutory rights of evicted tenants under Sections 27 and 28.

Invoking those sections, the appellant applied to the trial court for possession of the shop occupied by Respondent 2. The trial court allowed the application, but on revision the High Court reversed, ruling that the landlord need only offer any tenement in the new building. The Supreme Court granted special leave to appeal from that order.

Legal Issues Presented

  1. Whether a tenant who has complied with Sections 27 and 28 of the Karnataka Rent Control Act is entitled to a tenement in the reconstructed building that reasonably corresponds to his original premises, or whether the landlord satisfies the statute by offering any available tenement.
  2. Consequently, whether the appellant is entitled to the 9′ × 16′ street-facing shop presently occupied by Respondent 2.

Arguments of the Parties

Appellant’s Arguments

  • Sections 27 and 28 grant a statutory right to a shop that is at least comparable to the premises originally occupied; size and street frontage are integral to comparability.
  • The alternative shop offered (11′ 6″ × 8′ 6″, rear side) is neither comparable in dimensions nor location.
  • Respondent 2’s tenancy arose pending litigation and is expressly subject to the appellant’s superior statutory right, as already declared by the High Court.

Respondent 1 (Landlord)

  • The statute obliges the landlord only to provide a tenement in the new building; exact or comparable equivalence is not required.
  • An alternative rear-side shop has been offered and satisfies this obligation.

Respondent 2 (Subsequent Tenant)

  • He lawfully holds a tenancy of the 9′ × 16′ street-facing shop and should not be disturbed.
  • Several other similar shops are available to the appellant; therefore, his particular shop should not be singled out.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
K. Sreenivasa Rao v. K. M. Narasimhiah, AIR 1972 Mys 90; (1972) 1 Mys LJ 490; 1972 Ren CR 279 Subsequent tenancies created during proceedings under Section 21(1)(j) are subject to the statutory rights of the original tenants under Sections 27 and 28. Relied upon to hold that Respondent 2’s rights are subordinate and cannot defeat the appellant’s statutory claim to re-occupation.

Court's Reasoning and Analysis

The Supreme Court noted that once a tenant against whom a decree under Section 21(1)(j) has been passed serves notice under Section 27, Section 28(1) grants an entitlement to occupy the building on completion. Although the provision does not expressly define the nature of the tenement, a commonsense reading, in the Court’s view, requires that the replacement premises be reasonably comparable to those previously held.

The High Court, whose order was under appeal, framed the issue as whether the tenant was entitled to an identical shop. The Supreme Court considered this misdirected; the proper inquiry is comparability, not identity.

On the facts, the appellant’s original shop was 9′ × 17′ and fronted Belepet Main Road. The landlord’s offer (11′ 6″ × 8′ 6″, rear side) lacked both comparable size and crucial street frontage. Conversely, several newly built 9′ × 16′ shops facing the main road existed, one of which the landlord had “hurriedly” let to Respondent 2 after succeeding before the appellate judge. The Court considered that manoeuvre an attempt to forestall the appellant’s statutory claim.

Regarding Respondent 2’s objection, the Court held him bound by the earlier High Court decision (AIR 1972 Mys 90) declaring his rights subordinate to the appellant’s. Having neither contested that judgment nor appealed, Respondent 2 could not now resist dispossession.

Holding and Implications

APPEAL ALLOWED. Respondent 1 is directed to place the appellant in possession of the street-facing 9′ × 16′ shop presently occupied by Respondent 2. Respondent 2 must vacate and hand over possession accordingly. Costs are awarded against Respondent 1; no costs are ordered between the appellant and Respondent 2.

Implications: The decision clarifies that Sections 27 and 28 of the Karnataka Rent Control Act require landlords to provide evicted tenants with premises that are reasonably comparable—not merely any space—in the reconstructed building. It also reinforces that tenancies created pendente lite cannot override the statutory re-entry rights of former tenants.

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    K. Srinivasa Rao v. K.M Narasimhaiah And Another

    M.H Kania, J.— This is an appeal against a judgment of a learned Single Judge of the Karnataka High Court by special leave granted under Article 136 of the Constitution.

    2. Respondent 1 is the landlord and K. Gopal Krishna to whom notice was given by this Court and has appeared pursuant thereto is the person who was inducted as a tenant by Respondent 1 in the said premises immediately on an appeal by Respondent 1 being allowed by the First Additional District Judge, Bangalore as set out hereinafter. We direct that K. Gopal Krishna be joined as Respondent 2 in the appeal.

    3. The appellant was one of the eight tenants in the building belonging to Respondent 1, in respect of a shop admeasuring 9′ x 17′. The shop of the appellant was one of the four shops on the ground floor of the building facing Belepet Main Road, Bangalore City. The other premises in the said building comprised four office premises on the first floor. Respondent 1 filed eight eviction petitions in the court of the First Munsiff, Bangalore seeking eviction of the tenants in the said building on the ground that the building was bona fide required by him for the immediate demolition and reconstruction as contemplated under Section 21(1)(j) of the Karnataka Rent Control Act, 1961 (hereinafter referred to as “the Karnataka Rent Act”). In the eviction petition against the appellant, Respondent 1 specifically stated that the appellant might occupy the premises corresponding to the original tenement in the new building after it was built. It may be mentioned that subsequently, Respondent 1 filed an application for amending the averment in the eviction petition to delete the words “corresponding portion”. He also filed an application for leave to withdraw his offer set out earlier. Both these applications were rejected. The appellant and one other tenant filed memoranda consenting to a decree being passed in pursuance of Section 21(1)(j) of the Karnataka Rent Act. Pursuant to the memorandum filed by the appellant, wherein it was stated that the key was also handed over to the landlord, the court passed an order allowing the eviction petition against the appellant under Section 21(1)(j) of the Karnataka Rent Act. After the reconstruction of the building was commenced, the appellant gave a notice to Respondent 1 of his intention to occupy the corresponding shop in the new building and stated that he was agreeable to pay the fair rent in respect of the said shop as contemplated under Section 27 of the Karnataka Rent Act. It may be mentioned that, in the meantime, Respondent 1 got the plans of the proposed new building altered from time to time and in these revised plans dimensions of the shops proposed to be constructed in the new building were altered. In the meantime, curiously enough, Respondent 1 who had got the eviction decree filed an appeal in the court of the First Additional District Judge, Bangalore, challenging the eviction decree in terms of Section 21(1)(j) of the Karnataka Rent Act passed by the First Munsiff, Bangalore on the ground that the said decree had been passed by consent and the court had no jurisdiction to pass any decree by consent under Section 21(1)(j) of the Karnataka Rent Act. This appeal was allowed by the learned Additional District Judge. Immediately on the appeal being allowed, Respondent 1 inducted Respondent 2 as the tenant in a shop in the new or reconstructed building reasonably corresponding to the shop occupied by the appellant in the old building and Respondent 2 started business therein in the name and style of Sri Cutpiece Centre. The appellant preferred a revision petition to the High Court against this decision. In the said revision petition, the appellant has joined as Respondent 2, K. Gopala Krishna. The said revision petition was allowed by the High Court. The High Court inter alia held that the decree passed by the learned Munsiff under Section 21(1)(j) of the Karnataka Rent Act was not a decree passed by consent but was a valid decree passed by a competent court after application of mind. In respect of the objections raised by Respondent 2, it was held by the High Court that since the demolition and reconstruction were in pursuance of an order of eviction passed under sub-clause (j) of Section 21(1) of the Karnataka Rent Act, there cannot be any doubt that the landlord is liable to place the tenants in vacant possession of the reconstructed building as provided in the Act. It was further held that since the lease in favour of Respondent 2 came into existence and Respondent 2 occupied the new building during the pendency of the proceedings arising out of the landlord's eviction petition under Section 21(1)(j) of the Karnataka Rent Act, the rights of Respondent 2 are subject to the rights of the original tenants conferred on them under Sections 27 and 28 of the Karnataka Rent Act. (See: K. Sreenivasa Rao v. K.M Narasimhiah AIR 1972 Mys 90, (1972) 1 Mys LJ 490, 1972 Ren CR 279.)

    4. Subsequent to this order of the High Court allowing the revision petition of the appellant, the appellant filed an application under Sections 27 and 28 of the Karnataka Rent Act before the trial court for permitting him to occupy the said shop premises which had been given by Respondent 1 in the possession of Respondent 2 as a tenant. The trial court allowed this application filed by the appellant and held that the appellant was entitled to get the said shop occupied by Respondent 2 which admeasured 9′ x 16′ in place of the old one. On revision, by the impugned order, the High Court set aside the order passed in favour of the appellant, taking the view that the appellant was not entitled to claim the shop occupied by Respondent 2 and Respondent 1, the landlord, was only required to give to the appellant a tenement, that is, any tenement in the newly constructed building. The appellant claims to be entitled to be put in possession of the shop admeasuring 9′ x 16′ facing the Belepet Main Road occupied by Respondent 2 whereas Respondent 1 has offered to the appellant only a shop behind this shop admeasuring 11′6″ x 8′6″ which is not facing the main road, namely, the Belepet Main Road. It is this claim of the appellant which was accepted by the trial court but rejected by the High Court on revision. The order of the High Court is challenged before us in this appeal.

    5. In order to appreciate the contentions raised by the appellant, we may set out the relevant provisions of the Karnataka Rent Act. Section 21 of the said Act protects tenants against eviction. The relevant portion of the said section runs thus:

    “21. Protection of tenants against eviction.—(1) Notwithstanding anything to the contrary contained in any other law or contract, no order or decree for the recovery of possession of any premises shall be made by any court or other authority in favour of the landlord against the tenant:
    Provided that the court may on an application made to it, make an order for the recovery of possession of a premises on one or more of the following grounds only, namely :

    ***

    (j) that the premises are reasonably and bona fide required by the landlord for the immediate purpose of demolishing them and such demolition is to be made for the purpose of erecting a new building in place of the premises sought to be demolished:

    ***”

    6. Section 27 of the said Act runs thus:

    “27. Tenant's right to give notice to the landlord of his intention to occupy tenement in new building.—Where decree for eviction has been passed by a court on the ground specified in clause (j) of the proviso to sub-section (1) of Section 21 and the work of demolishing the premises and of the erection of a new building has been commenced by the landlord, the tenant may, within six months from the date on which he delivered vacant possession of the premises to the landlord, give notice to the landlord of his intention to occupy the new building on its completion on the following conditions, namely:

    ***

    (a) that he shall pay to the landlord the fair rent in respect of the building:

    ***”

    The rest of the provisions of this section are not material for our purpose.

    7. Sub-section (1) of Section 28 of the said Act runs thus:

    “28. Landlord to intimate the tenant, date of completion and tenant's right to occupy the new building.—(1) On receipt of notice from the tenant under Section 27, the landlord shall, not less than three months before the date on which the erection of the new building is likely to be completed, intimate the tenant the date on which the said erection shall be completed. On the said date, the tenant shall be entitled to occupy the building.”

    8. In the case before us the decree against the appellant was passed under the provisions of Section 21(1)(j) of the Karnataka Rent Act. The appellant tenant gave notice of his intention to occupy the tenement in the new building as required under the provisions of Section 27 of the said Act. This is the undisputed position. In view of this, under the provisions of Section 28 of the said Act, the appellant became entitled to occupy a tenement in the new building. The only question before us is as to what is the nature of the tenement to which he is entitled. There is nothing specific in this connection in the language of sub-section (1) of Section 28. However, a fair commonsense reading of the provisions of sub-section (1) of Section 28 would show that a tenant against whom eviction decree has been passed under Section 21(1)(j) and who has given notice as contemplated under Section 27 of that Act would be entitled to a tenement in the new building which could be said to be reasonably comparable to or to reasonably correspond to the tenement in respect of which the decree was passed. It appears to us that the learned Judge of the High Court who delivered the impugned judgment has based it on the consideration of a question which really was not material, namely, whether the appellant was entitled to get an identical shop in the new building, whereas the real question was as to whether he was entitled to a comparable shop. On the facts of the present case, it can be seen that the original shop occupied by him admeasured 17′ x 9′ and was facing the Belepet Main Road. The shop which Respondent 1 has offered to the appellant was only admeasuring 11′6″ x 8′6″ and was not facing the Belepet Main Road but was on the rear of the new building. We fail to see how this shop can be considered as comparable to shop originally occupied by the appellant. Moreover, it is not as if comparable shops were not available. In fact, Respondent 1 constructed several shops of 9′ x 16′ facing the Belepet Main Road, one of which he has given in a hurried manner, as set out earlier, to Respondent 2, probably with a view to forestall the claim of the appellant. In these circumstances, we fail to see how the appellant could be compelled to accept the shop offered by Respondent 1, which is in no way comparable. The provisions referred to earlier clearly suggest that, at the least, the appellant was entitled to a shop as reasonably corresponding to the original shop occupied by him as the circumstances would permit. It may be clarified here that it is not the appellant's case that he is entitled to an identical shop but that he was entitled to a comparable shop. It was submitted by Mr Kaushik, learned counsel for Respondent 2 that as far as the shop given to him is concerned, which is claimed by the appellant, he has already obtained tenancy of the said shop from Respondent 1 and there is no reason why his tenancy should be disturbed. It is urged by him that there are a number of similar shops constructed by Respondent 1 landlord facing the Belepet Main Road and there is no reason why his shop should be picked out for being given to the appellant. In our view, whatever might be the merits of this submission, it is not open now to Respondent 2 to make this submission or resist the claim of the appellant. Respondent 2 was joined as a party in the revision petition disposed of by a Division Bench of the Mysore High Court as set out earlier, which was between the same parties and which decision we have already discussed in some detail earlier (reported in K. Sreenivasa Rao v. K.M Narasimhiah AIR 1972 Mys 90, (1972) 1 Mys LJ 490, 1972 Ren CR 279). In that case, the High Court held that the rights of Respondent 2 are subject to the rights of the original tenants conferred upon them under Sections 27 and 28. This decision has not been challenged by Respondent 2 in any proceedings and has now become final as against him. In view of this, it is not open to him now to raise any of the contentions which he has sought to raise. It was open to him to make any submission which he wanted to make in that case or to file an appeal against the judgment insofar as it adversely affected him but he has not chosen to do so and it is not now open to him to raise these contentions. We are of the view that the appellant is entitled to be handed over the possession of the shop occupied by Respondent 2.

    9. Before parting with the case, we may mention that the learned counsel for the appellant referred to a couple of decisions given by High Courts holding that under provisions similar to those we have discussed earlier, a tenant is not entitled to identical premises in the newly constructed building, but in the view which we have taken, as set out earlier, these decisions are of no relevance.

    10. In the result, the appeal is allowed with costs against Respondent 1 and Respondent 1 is directed to put the appellant in possession of the said shop occupied by Respondent 2 as a tenant and Respondent 2 is directed to hand over his shop for the aforesaid purpose. There will be no order as to costs as between the appellant and Respondent 2.

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    K. Srinivasa Rao v. K.M Narasimhaiah And Another
    (Feb 9, 1989)