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Kolisetti Venkaiah v. Tadikamalla Satyanarayana .
Legal Opinion Summary
Factual and Procedural Background
This Civil Revision Petition arises from an eviction petition filed under Section 10 of the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960. The tenant is the petitioner and the landlord is the respondent. The Rent Controller ordered eviction of the tenant; that eviction order was confirmed on appeal by the learned Subordinate Judge, Guntur. The tenant filed this civil revision against that confirmation.
The subject property is a shop building located in Patnam Bazar (Guntur town), described as the main business locality. The respondent purchased the shop under sale deed Ex. A-2 dated 5-10-1967 for Rs. 15,000/-. The petitioner has been occupying the shop as a tenant and conducting a trade in biscuits. The respondent filed the eviction petition after the petitioner refused to vacate following the respondent’s purchase.
The respondent stated that he was carrying on a wholesale sugar candy business in another building he owned in a residential locality about 200 yards from the business centre; increasing competition (15–16 sugar candy shops in the main bazar) caused his business to decline, and he therefore purchased the suit building to carry on and expand his sugar candy business there. The petitioner contended the respondent's present building was also in a business locality and argued the respondent’s claim for personal occupation was not bona fide; the petitioner also asserted (through witnesses) that after purchase the respondent demanded enhanced rent of Rs. 250 and filed eviction when the petitioner refused to pay.
The Rent Controller found the respondent’s requirement to be bona fide and found that the building the respondent was then occupying was residential in nature. The Subordinate Judge disagreed on the nature of the respondent’s existing building (finding it non-residential) but nevertheless confirmed the eviction order, following the Bench decision in Balaiah v. Lachaiah, AIR 1965 Andh Pra 435. The civil revision challenges that confirmation and related findings.
Legal Issues Presented
- Whether, under Section 10(3)(a)(iii) of the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960, a landlord who already occupies a non-residential building in the same city, town or village can claim possession of another non-residential building of his own from a tenant for the purposes of carrying on or expanding his business (i.e., whether the landlord can evict a tenant in such circumstances).
- Whether the respondent’s requirement of the suit building was bona fide personal occupation for business and thus a valid ground for eviction under the Act.
- Whether the learned Subordinate Judge was justified in relying on an Amin’s report (inspection report) made after arguments without giving the parties an opportunity to make representations regarding that report.
- Whether the allegation that the respondent demanded enhanced rent (Rs. 250) and filed eviction because the petitioner refused to pay should affect the bona fides of the eviction claim.
Arguments of the Parties
Respondent (Landlord) — Principal Contentions
- The respondent purchased the suit shop building for Rs. 15,000 on 5-10-1967 to carry on and expand his wholesale sugar candy business, because his existing business had declined due to competition in the main bazar.
- His then-existing business premises were located in a residential locality about 200 yards from the business centre and were not suitable or sufficient for his business needs; hence he required possession of the suit building for bona fide personal occupation for business.
- The respondent gave evidence as P.W.1 describing the circumstances and purpose of purchase and intended occupation for his sugar candy business.
Petitioner (Tenant) — Principal Contentions
- The petitioner contended that the building in which the respondent was then carrying on his business was also in a business locality and was convenient for the respondent’s business, challenging the bona fides of the respondent’s claim to require the suit building.
- The petitioner (through his witness R.W.1 and his own evidence as R.W.2) stated that after the respondent purchased the suit building he demanded an increased rent of Rs. 250 and, when the petitioner refused, the respondent filed the eviction petition — implying a motive of rent enhancement rather than genuine personal need.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Balaiah v. Lachaiah, AIR 1965 Andh Pra 435 | Interpreted the counterpart of S. 10(3)(a)(iii) to allow a landlord who already occupies a non-residential building in the same locality to claim another non-residential building from a tenant if he satisfies the Rent Controller that the existing premises are not sufficient or suitable for expansion, or that shifting/expansion has become inevitable; effectively recognized circumstances in which eviction is permissible despite prior occupation of another non-residential property. | The learned Subordinate Judge followed this Bench decision to confirm the eviction. The revising court considered the decision carefully and expressed the opinion that the view in AIR 1965 Andh Pra 435 is the correct interpretation of Section 10(3)(a)(iii). |
| Chowdary Bakkara Hussein Saheb v. Mouli Saheb…, 1956 Andh LT 370 | Single Judge decision interpreting a provision similar to Section 10(3)(a)(iii) to mean that a landlord desiring possession of a non-residential building must not be occupying any other non-residential building; i.e., if a landlord is in possession of another non-residential building, he cannot seek eviction of a tenant from a different non-residential building he owns. | The court noted this single Judge decision took a contrary view to AIR 1965 Andh Pra 435. The revising court acknowledged it but did not accept it, preferring the Bench decision in AIR 1965 Andh Pra 435 as the correct interpretation. |
| V. Veerabhadrulu v. Kancherla Rama Rao, 1958 Andh LT 728 | Single Judge decision reaching the same conclusion as 1956 Andh LT 370—that a landlord occupying a non-residential building cannot apply to evict a tenant from another non-residential building he owns in the same locality. | The revising court recorded that this decision supported the contrary view but ultimately adhered to the reasoning and conclusion of AIR 1965 Andh Pra 435, considering that Bench decision the correct interpretation of Section 10(3)(a)(iii). |
Court's Reasoning and Analysis
The court began with a textual reading of Section 10(3)(a)(iii) of the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960, which on its face restricts a landlord seeking possession of a non-residential building to cases where the landlord is not occupying a non-residential building of his own in the same locality. The court observed, however, that a Bench decision (Balaiah v. Lachaiah, AIR 1965 Andh Pra 435) interpreted the provision in a manner that recognizes legitimate requirements of landlords and permits eviction where the landlord can show that his existing non-residential premises are not sufficient or suitable for expansion or where shifting/expansion has become inevitable.
The court summarized the evidence: the respondent (P.W.1) testified that his present premises were located in a residential locality at a distance of about 200 yards from the business centre, that competition in the main bazar had reduced his business, and that he purchased the suit building to carry on and expand his sugar candy business. The petitioner’s witnesses (R.W.1 and R.W.2) alleged a demand for higher rent (Rs. 250) after purchase, but both the Rent Controller and the learned Subordinate Judge rejected that allegation on the ground that the increased rent demand was not pleaded in the petitioner's counter.
Both the Rent Controller and the Subordinate Judge concurrently found the respondent’s requirement to be bona fide. Although the Subordinate Judge differed from the Rent Controller on whether the respondent’s then-occupied building was residential or non-residential (the Rent Controller found it residential; the Subordinate Judge found it non-residential), the Subordinate Judge nonetheless confirmed eviction relying on the Bench decision in AIR 1965 Andh Pra 435 that permits eviction in specified circumstances even when the landlord occupies another non-residential building.
The revising court scrutinized the Subordinate Judge’s reliance on an Amin’s report obtained after arguments. The court held that the Subordinate Judge was not justified in basing a conclusion on the Amin's report without providing the parties an opportunity to make representations about that report. Consequently, the court held that the Rent Controller’s finding that the respondent’s then-occupied building was residential should stand.
The court further reasoned that even if the respondent’s present building were treated as non-residential, the respondent would still be entitled to possession under the circumstances of the case (the court accepted the bona fide requirement finding). The court considered earlier single Judge decisions (1956 Andh LT 370 and 1958 Andh LT 728) that had taken a stricter view of Section 10(3)(a)(iii) — holding that a landlord occupying any other non-residential building cannot seek eviction — but expressed the view that the Bench decision in AIR 1965 Andh Pra 435 had carefully considered the matter and reached the correct interpretation of Section 10(3)(a)(iii). On that basis the revising court endorsed the bench approach that allows eviction where the landlord proves the insufficiency or unsuitability of his existing premises or inevitability of shifting/expansion.
The revising court concluded that the concurrent findings of the Rent Controller and the Subordinate Judge that the respondent’s requirement was bona fide were not shown to be wrong on the evidence before the court, and therefore there was no ground to interfere with the eviction order.
Holding and Implications
Revision dismissed.
Implications and direct effects:
- The civil revision petition filed by the tenant has no merit and is dismissed with costs.
- The petitioner (tenant) was granted two months' time to vacate the building, and the eviction order as confirmed by the Subordinate Judge stands.
- The court endorsed the interpretation in AIR 1965 Andh Pra 435 that Section 10(3)(a)(iii) can permit eviction even where the landlord occupies another non-residential building, provided the landlord satisfies the Rent Controller that the existing premises are not sufficient or suitable for expansion or that shifting/expansion has become inevitable. The court preferred that Bench view over earlier single Judge decisions taking a more literal exclusionary approach.
The opinion contains no indication that the court sought to lay down a novel or broader precedent beyond its express endorsement of the Bench decision in AIR 1965 Andh Pra 435 and its application to the facts of this case.
1. This Civil Revision Petition arises out of an eviction petition filed under Section 10 of the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960 (hereinafter referred to as the Act). The tenant is the petitioner and the respondent the landlord. The Rent Controller ordered eviction and it was confirmed in appeal by the learned Subordinate Judge, Guntur. Hence this petition by the tenant.
2. The building in question is a shop building situated in Patnam Bazar (Guntur town) which is the main business locality of the Guntur town. The respondent purchased the shop building for a sum of Rs. 15,000/- under sale deed, Ex. A-2 dated 5-10-1967. The petitioner has been occupying the shop as a tenant under the previous owner and carrying on his trade in biscuits etc. The respondent filed the eviction petition when the petitioner refused to vacate it when he was required to do so after the respondent purchased the building. Therefore, the eviction petition by the respondent The case of the respondent is that he has been carrying on his wholesale business in sugar candy in another building of his own in a residential locality which is at a distance of over 200 yards from the business centre. Of late, many sugar candy shops have come up in the main bazar where the suit building is situated. On that account, his business fell down. Therefore, he purchased the suit building for a sum of Rupees 15,000/- for the purpose of carrying on his sugar candy business in that building. Therefore, the case of the respondent is that he requires the suit building for the purpose of his business which he is already carrying on in order to improve it. The case of the petitioner is that the building in which the respondent is now carrying on his business is also in a business locality and that building also is convenient for carrying on his business. The claim of the respondent for personal occupation is not bona fide. The respondent demanded a rent of Rs. 250/- to which the petitioner did not agree and that is a real reason for filing the eviction petition.
3. If the building in question is a non-residential building, the provision of law under which the respondent can ask for the eviction of the petitioner is one mentioned under S. 10(3)(a)(iii) which reads as follows:—
“A landlord may………apply to the Rent Controller for an order directing the tenant to put the landlord in possession of the building………
(iii) In case it is any other non-residential building, if the landlord is not occupying a non-residential building which is his own for the purpose of the business which he is carrying on or which the landlord bona fide proposes to commence.”
Both the Rent Controller and the learned Subordinate Judge concurrently found that the respondent requires the building bona fide for the purposes of carrying on his own business in it. The Rent Controller also found that the building in which the respondent is at present carrying on his business is a residential building in a residential locality. But in the appeal the learned Subordinate Judge came to a contrary conclusion and found that the building in which the respondent is at present carrying on his business is also a non-residential building. But still the learned Subordinate Judge confirmed the eviction order passed by the Rent Controller following the Bench decision of this Court in Balaiah v. Lachaiah, AIR 1965 Andh Pra 435 by coming to the conclusion that the building in question is more suitable for carrying on the sugar candy business of the respondent and it is necessary for him to increase and expand his business and with a view to expand his business only the respondent has purchased the building.
4. By a plain reading of Section 10(3)(a)(iii) of the Act it appears that a landlord can require a non-residential building by evicting a tenant only if he is not already occupying a non-residential’ building in the same city, town or village. But nonetheless it was held in the above Bench decision that even in such cases a landlord can ask for eviction under certain circumstances. The learned Judges observed that:—
“the Act does not disregard the legitimate and valid requirements of the landlord. That is why in several provisions of the Act the tenants and landlords’ rights and liabilities are attempted to be balanced. It is evident from Section 10(3)(c) that a landlord can claim a portion of the same building given on rent whatever may be the nature of his requirement; namely residential or nonresidential subject of course, to the satisfaction of other requirements of that provision. When a landlord can thus get a tenant evicted under Sec. 10(3)(c) in this manner, we fail to see why the landlord in an earlier clause would have been given altogether a different and diametrically opposite treatment. It is therefore, impossible to construe Section 10(3)(a)(iii) to mean that the landlord cannot in any case evict a tenant from another of his non-residential building if he is in occupation of a non-residential building in same city either for his business which he is carrying on or for a new business.”
Having said that, the learned Judges have held that:—
“We are, therefore, of the clear opinion that what the said provision means is this when a landlord, who is in occupation of a non-residential building in a city, town or village requires another non-residential building of his own in the same city, town or village as the case may be from his tenant for the purpose of the business which he is carrying on which can mean shifting or expansion of the business which he is carrying on or for commencing a new business can successfully claim eviction of his tenant if he is able to satisfy the Rent Controller that the non-residential building which he is occupying is not sufficient or suitable for the purpose of expansion of his business or for the purpose to commence, or that the shifting of his business has, in the circumstances of the case become inevitable. It would be open to him to prove that the non-residential building which he is occupying is not exclusively his own or that he is not entitled to its exclusive possession. Any one of the abovementioned cases falls, in our view, within the ambit of Section 10(3)(a)(in).”
5. In support of his case the landlord examined himself as P.W 1. He has stated in his evidence-that at present he is carrying on his business in the same building in which he is also residing. There are only residential houses in that locality. It is not a ‘business centre and that the present building which he is occupying is at a distance of 200 yards from the business centre. There are now 15 or 16 sugar candy shops in the main bazar and his business fell down. Therefore he purchased the suit building for a sum of Rs. 15,000/- for the purpose of carrying on his business there. In support of the case of the petitioner, besides his giving evidence as R.W 2, he has also examined one more witness as R.W 1. Both of them have stated that after the respondent purchased the suit building he demanded more rent from the petitioner at the rate of Rs. 250/- and when the petitioner did not agree to pay rent at that rate the respondent filed the eviction petition. This fact spoken to by R. Ws. 1 and 2 was not accepted by both the Rent Controller and the learned Subordinate Judge on the ground that this demand of rent at the rate of Rs. 250/- said to have been made by the respondent has not been stated in the counter filed by the petitioner. On the evidence adduced in the case, both the Rent Controller and the learned Subordinate Judge concurrently found that the requirement of the building by the respondent is bona fide and he purchased the building for a sum of Rs. 15,000/- for the purpose of carrying on his sugar candy business there, it being a business centre and more suitable for carrying that business; I do not see any reason to find that that conclusion come to by both the courts is in any way wrong.
6. As regards the nature of the building which the respondent is at present occupying; while the Rent Controller came to the conclusion that it is a residential building, the learned Subordinate Judge reversing that finding found that it is a non-residential building. Whether that building is a residential or non-residential building does not matter very much now as even though it is a nonresidential building, still having regard to the circumstances of this case, the respondent is entitled to get the possession of the building in question after evicting the tenant. It appears that in the same building the respondent let out a portion for the purpose of a godown. However, the Rent Controller found that the portion was let out only for the purpose of a godown and not to carry on any trade and that the building which the respondent is now occupying is more suitable as a residential building and not for the purpose of carrying on business and accordingly he came to the conclusion that it is not a non-residential building.
7. The learned subordinate Judge has stated in his judgment that after the close of the arguments in the appeal, he deputed an Amin to visit the locality and report to him. The Amin reported that in the building where the respondent is carrying on his business at present there is no residence put up and therefore it should be taken that the building where the respondent is carrying on his business at present is a non-residential building and not partly residential and partly non-residential. I do not think that the learned Subordinate Judge is justified in basing his conclusion on the report of the Amin without giving an opportunity to the parties to make their representations about the report submitted by the Amin. I think that conclusion arrived at by the learned Subordinate Judge basing the same on the report of the Amin cannot stand. Therefore, it should be taken as found by the Rent Controller that the building in question is a residential building and not a non-residential building. In which case, the respondent is entitled to the possession of the building whatever view may be taken with regard to the interpretation to be put on Section 10(3)(a)(iii) of the Act. Sri I.A Naidu, learned counsel for the petitioner has argued that with regard to the interpretation of the provision contained in S. 10(3)(a) (in) two earlier single Judge decisions of this court in Chowdary Bakkara Hussein Saheb… v. Mouli Saheb…., 1956 Andh LT 370, V. Veerabhadrulu v. Kancherla Rama Rao, 1958 Andh LT 728 took a different view from the one expressed in AIR 1965 Andh Pra 435 (Supra) and those two single Judge decisions were not brought to the notice of the learned Judges who decided the case AIR 1965 Andh Pra 435 (supra) and if these two single Judge decisions were to be brought to their notice, it is quite possible that they would have agreed with the view taken in those cases and therefore, according to the learned counsel, it may be the matter requires further consideration by a Bench or if necessary by a Full Bench. In the two single Judge decisions the learned Judges were considering Section 7(3)(a)(iii) of the Madras Building (Lease and Rent Control) Act of 1949 which is a similar to the present Section 10(3)(a)(iii) of the Act.
8. In 1956 Andh LT 370, Umamahe swaram, J. took the view that if a landlord desires to get possession of a nonresidential building, he must not be occupying any other non-residential building. Similarly, Seshachalapathi, J. who decided the case, 1958 Andh LT 728 was of the same view. He said that a landlord may apply to the Rent Controller for an order directing the tenant to put him in possession of a non-residential building only if he is not occupying for the purpose of his business a non-residential building in the city, town or village concerned which is his own. He said it is not open to the landlord to pick and choose from among the non-residential building which he owns. If he is found to be in possession of another nonresidential building, he cannot apply for eviction of the tenant and the court would have no jurisdiction to order such eviction. In the decision AIR 1965 Andh Pra 435 (supra) the learned Judges have carefully considered the entire matter from all aspects and came to the conclusion that having regard to the scheme of the Act, it would not have been the intention of the Legislature that a landlord under no circumstances can require a non-residential building of his own if he is already occupying a non-residential building of his own, in the same city, town or village. With great respect to the learned Judges, in my opinion, that is the correct view to be taken in interpreting the provision contained in Section 10(3)(a)(iii) of the Act
9. The result Is there are no merits in this Civil Revision Petition and accordingly it is dismissed with costs. The petitioner is granted two months time to vacate the building.
10. Revision dismissed.
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