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V. Vatsala v. Official Assignee Of Madras, Representing The Estate Of S.V Namasivayam.

Madras High Court
Oct 5, 1978
Smart Summary (Beta)

Factual and Procedural Background

The petitioner is a tenant who was inducted into possession of premises described as municipal door No. 109.D/6-A, Mount Road, Madras, together with machinery embedded in the premises, by one Namasivayam under a lease deed (Ex.P-1) dated 14 January 1972. The tenant remained in possession until a third party dispute arose.

On 27 July 1972, one Jagadisan, claiming to have purchased premises described as door No. 109-D/6, asserted paramount title and threatened civil and criminal proceedings unless the tenant attorned to him. Afraid of those threats, the tenant attorned to Jagadisan and thereafter paid rent to him. The tenant informed Namasivayam of these developments and sought return of the advance paid under Ex.P-1, but received no reply.

Namasivayam subsequently purported to terminate the tenancy under Ex.R-6 and asked the tenant to vacate. The tenant maintained that she had attorned to Jagadisan and therefore did not need to obey Namasivayam's termination. Namasivayam became insolvent; his assets vested in the Official Assignee under the Presidency Towns Insolvency Act. The Official Assignee, acting for the body of creditors, continued the eviction action (the action begun under Ex.R-6) and instituted the present petition under S. 10(2)(i) and 10(2)(iii) of Tamil Nadu Act 18 of 1960, alleging wilful default in rent and that the tenant had set up a hostile title in third parties.

In the Rent Control proceedings, the tenant did not implead Jagadisan as a party but examined him as a witness. Jagadisan produced a sale deed (Ex.R-10) and claimed that Namasivayam never had interest in the land; relying on that, the Rent Controller accepted the tenant's defence as bona fide and dismissed the eviction petition filed by the Official Assignee. On appeal, the Appellate Authority reached a contrary conclusion and granted eviction. The tenant filed the present Civil Revision Petition challenging the Appellate Authority's order.

Legal Issues Presented

  1. Whether the tenant's defence — consisting of denying the landlord's title by setting up title in a third party (Jagadisan) — falls within the second proviso to S. 10(1) of Act 18 of 1960 (i.e., whether such denial can be treated as a bona fide denial of the landlord's title or claim of permanent tenancy by the tenant).
  2. Whether the Official Assignee, as successor-in-interest to the insolvent Namasivayam and representative of his creditors, could institute the eviction petition under S. 10(2)(i) and 10(2)(iii) of the Act, and whether the tenant's plea that the property belonged to Jagadisan defeats that action.
  3. Whether the alleged sale to Jagadisan (Ex.R-10) in respect of premises bearing door No. 109.D/6 is factually the same property as the suit premises described as 109.D/6-A (a factual contention).

Arguments of the Parties

Official Assignee's Case

  • The Official Assignee alleged wilful default by the tenant in payment of rents due in respect of her occupation of premises No. 109.D/6-A.
  • He claimed the tenant was liable to eviction because she had set up a hostile title in third parties (i.e., she was claiming that a third party owned the premises) thereby denying the landlord's title.
  • The Official Assignee proceeded with the eviction petition originally proposed by Namasivayam and instituted the petition under S. 10(2)(i) and 10(2)(iii) of Act 18 of 1960 as successor-in-interest.

Tenant / Petitioner's Case (as advanced before the Court)

  • The tenant contended that her denial of Namasivayam's title was bona fide within the meaning of the second proviso to S. 10(1) of Act 18 of 1960.
  • She relied on the evidence of Jagadisan (who testified for her) and the sale deed Ex.R-10 to assert that the suit premises never belonged to Namasivayam and in consequence the Official Assignee could not claim any right to evict her.
  • The tenant explained that she attorned to Jagadisan because of his threats and thus paid rent to him after attornment.

Jagadisan (third-party witness)

  • Although not made a party, Jagadisan was examined by the tenant and asserted title by relying on the sale deed Ex.R-10, claiming that he purchased the property bearing door No. 109-D/6 and that Namasivayam had no interest.
  • He did not, according to the record, correspond with the Official Assignee to assert his alleged interest.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The Court began by identifying the two-fold nature of the dispute: a legal contention (application of the second proviso to S. 10(1) of Act 18 of 1960) and a factual contention (whether Jagadisan in fact had title to the suit property). The judge analyzed the statutory language and purpose of the second proviso to S. 10(1), noting that the Act is intended to protect tenants from unlawful and unreasonable eviction and that the proviso contemplates a tenant's denial of the landlord's title or a tenant's claim to permanent tenancy.

The Court considered the doctrine of jus tertii (the right of a third party) and observed that while jus tertii is a recognised legal principle, the statutory context is crucial. The second proviso contemplates a tenant denying the landlord's title by asserting title in the tenant himself/herself or by claiming a right of permanent tenancy; it does not, in the Court's view, contemplate a tenant vesting or asserting title in a third party and thereby relying on that third party's title to defeat an eviction under the Act.

Applying that legal principle to the facts, the Court found that the tenant did not set up title in herself or claim a right of permanent tenancy; instead she attorned to Jagadisan and relied upon Jagadisan's asserted title. The Court emphasized that Jagadisan was not made a party to the proceedings, had a limited role (he only assisted the tenant as a witness and produced Ex.R-10), and had not communicated his alleged interest to the Official Assignee. The Court concluded that the second proviso's protection is available where the tenant asserts his or her own title or claims permanent tenancy; it is not available to a tenant who merely invokes the jus tertii by claiming title vests in a third party.

The Court also observed a factual doubt as to whether the property described in Ex.R-10 (premises bearing door No. 109.D/6) is the same as the suit premises described as 109.D/6-A. The Court stated that such questions of title and identity of the property must be established in appropriate litigation before a competent court and cannot be finally adjudicated in the summary proceedings under Act 18 of 1960. Because the tenant's denial of the landlord's title was based on vesting title in a third party rather than on the tenant's own claim, the Court considered the denial not bona fide within the meaning of the proviso.

Finding no error of jurisdiction or irregularity in the Appellate Authority's order, the Court dismissed the Civil Revision Petition. Nonetheless, recognising the hardship to the tenant who had been "driven from pillar to post" in litigation, the Court exercised equitable discretion to grant the tenant six months' time to vacate the premises.

Holding and Implications

Holding: The Civil Revision Petition is dismissed; the Appellate Authority's order granting eviction is upheld.

Implications:

  • The Court held that a tenant cannot claim protection under the second proviso to S. 10(1) of Act 18 of 1960 by merely asserting or relying upon title vested in a third party (jus tertii). The proviso protects a tenant who denies the landlord's title by claiming title in the tenant himself/herself or by asserting a right of permanent tenancy; it does not extend to denials based on third-party title asserted on the tenant's behalf.
  • Because the alleged third-party title (Jagadisan's) could not be finally adjudicated in summary Rent Control proceedings and because the tenant did not set up title in herself, the denial was not held to be bona fide for the purposes of the proviso.
  • Direct effect on the parties: the eviction stands (the Official Assignee's petition is successful on appeal), but the tenant is granted six months' time to vacate the premises.
  • The opinion does not purport to set a new, broader precedent beyond its statutory interpretation and application to the facts; it confines itself to interpreting the scope of the second proviso and applying it to the circumstances before the Court.

Reported identifiers and exhibit references used in this summary (e.g., Ex.P-1, Ex.R-6, Ex.R-10) are retained as they appear in the provided opinion. No additional facts or authorities have been introduced beyond the opinion text.

Show all summary ...

The question that arises in this Civil Revision Petition centres round a legal contention and a factual contention. The petitioner is the tenant who came to occupy a land bearing municipal door No. 109.D/6-A, Mount Road, Madras. She was admittedly inducted into possession of such land along with the machinery embedded thereto by one Namasivayam. This was under the lease deed Ex.P-1, d. 14th January, 1972. Everything went on alright until one Thandavan laid title to the machinery demised by Namasivayam. The leasehold interest as recognised by the tenant and which vested in Namasivayam was undisturbed till about July, 1972. On 27th July, 1972, it appears that one Jagadisan claiming a paramount title to the property in question as the purchaser of door No. 109-D/6. Mount Road, called upon the tenant-petitioner to attorn the tenancy to him under threat of civil and criminal proceedings if his demand was not conceded to. It appears that the tenant, afraid of such threats extended by Jagadisan, attorned tenancy to him, notwithstanding the fact that she was inducted into the property and the machinery was put into her custody by Namasivayam, and thereafter she was paying the rents to Jagadisan without reference to Namasivayam. She brought to the notice of Namasivayam the above threats of Jagadisan and sought for a return of the advance which she paid under Ex.P-1 at the time when Namasivayam let her into possession of the suit property, door No. 109.D-6-A, including the machinery thereon. There was no reply by Namasivayam. Thereafter, it appears that Namasivayam terminated the tenancy of the petitioner under Ex.R-6 and called upon the petitioner to vacate. The petitioner replied to Namasivayam stating that it was Jagadisan who is entitled to the property and since she bad already attorned the tenancy in favour of Jagadisan, she was not obliged to comply with the request of termination of tenancy or with the demand for vacating of the premises as claimed by Namasivayam in Ex.R-6. By that time, Namasivayam became an insolvent and his assets vested in the Official Assignee, under the Presidency Towns Insolvency Act, and the Official Assignee for and on behalf of the body of creditors continued the action proposed by Namasivayam under Ex.R-6 and instituted the present petition under S. 10(2)(i) and 10(2)(iii) of Tamil Nadu Act 18 of 1960. The Official Assignee's case was that there was wilful default in the payment of the rents due and payable by the tenant-petitioner in respect of her occupation of premises No. 109.D/6-A and she was liable to be evicted since she set up a hostile title in some third parties in respect of the premises in question.

2. The defence was that the property belonged to Jagadisan and the Official Assignee as the successor-in-interest and the representative of the body of creditors of Namasivayam cannot institute the present action and seek for eviction.

3. In the course of the hearing of the Rent Control Petition, Jagadisan was examined. He was not made party to these proceedings. The petitioner did not seek for impleading of Jagadisan as a party, notwithstanding the fact that she was shedding as much copious tears which were probably crocodile tears for Jagadisan. She, however, chose to examine him on her side. Naturally, Jagadisan relying upon the sale deed Ex.R-10, under which he is said to have purchased the property claimed that Namasivayam at no time had any interest on the suit land in question and supported the claim of the petitioner to continue in occupation of the suit premises as his own tenant. The Rent Controller accepted the defence of the tenant as a bona fide one and therefore, dismissed the petition for eviction filed by the Official Assignee.

4. On appeal before the Appellate Authority, the latter came to a different conclusion and granted the eviction. It is as against the grant made by the Appellate Authority that the present revision petition has been filed.

5. The learned counsel for the petitioner strenuously contended that the defence of the petitioner-tenant was bona fide within the meaning of the second proviso to S. 10(1) of Act 18 of 1960 (Tamil Nadu Buildings (Lease and Rent Control) Act of 1960) and that the evidence of Jagadisan has established factually beyond doubt that the suit premises did never belong to Namasivayam and, therefore, the Official Assignee as his successor-in-interest cannot claim any interest thereby.

6. Before going into the merits whether Jagadisan could be said to have any interest at any time in the property in question, let us consider whether the defence of the tenant in question could be said to be one which is available to such tenants under the second Proviso to S. 10(1). Jus tertii is a well-known principle in law wherein a person whose rights are sought to be interfered with by another takes umbrage under the rights said to be vetted in a third party other than the party opposing him and in certain circumstances, the defence of jus tertii is available to the affected party. But in a case like the one under consideration wherein the Act itself is to protect the tenants from unlawful and unreasonable eviction and is not intended to protect the interests of persons other than the tenants, whether the intendment of the Legislature in accordance with the language of second proviso to S. 10(1) was and is that the denial of title contemplated in the second proviso would also include the invocation of the doctrine of jus tertii. S. 10(1) provides that tenant shall not be evicted whether in execution of a decrec or otherwise except in accordance with the provisions of this Section or Ss. 14 to 16, provided that where the tenant denies the title of the landlord or claims right of permanent tenancy, the Controller shall decide whether the denial or claim is bona fide and if he records a finding to that effect, the landlord shall be entitled to sue for eviction of the tenant in a Civil Court and the Court may pass a deeree for eviction on any of the grounds mentioned in the said sections, notwithstanding that the Court finds such denial does not involve forfeiture of the lease or that the claim is unfounded.

7. It, therefore, follows that if the finding of the Rent Controller is that the denial is not bona fide, then the Controller would be entitled to pass an order for eviction. The question that arises in the instant case is whether such a denial as contemplated under the second proviso to S. 10(1) has arisen. The proviso is very clear when it says that the tenant should deny the title of the landlord. It does not say that the tenant can vest the title to the property in his occupation in third parties. This is the concept which is inherent in the principle of jus tertii. It is only in cases where the tenant while opposing an application for eviction under the provisions of Act 18 of 1960, sets up title in himself or herself the second proviso would come into operation and it is in that context alone the Rent Controller would have jurisdiction to find whether the denial of title of the landlord and setting up of such title in himself or herself by the tenant is bona fide or not. I am of the view that it is not open to the tenant to plead, taking advantage of the plain language of the second proviso to S. 10(1), that the denial as regards the title of the landlord might even mean and include the vesting of the title to the property in a third party. On the other hand, I am of the view that such denial of title of the landlord would be the resultant of a claiming of title in the property by the tenant herself or himself and not by setting up title in a third party. That it not the case here. What it attempted by the tenant is that one Jagadisan claims title to the property having purchased premises No. 109-D/6 under Ex.R-6 and that as he is threatening her civilly and criminally to take proceedings against her if she fails to attorn to him, she was compelled to so attorn the tenancy in favour of Jagadisan ignoring Namasivayam who admittedly inducted her into possession of the property in January, 1972 under a written instrument of lease. Excepting for the fact that Jagadisan tried to help the tenant-petitioner by getting into the box and pleading hit title to the property, he is said to have not even corresponded with the Official Assignee who is a Public Officer functioning under the Statute about his alleged title in the suit property. In fact, I querried the learned counsel appearing for the Official Assignee whether Jagadisan at any time wrote to the office of the Official Assignee claiming such interest either as a whole or in part over the property in question; but the answer was in the negative. Therefore, the part played by Jagadisan in the proceedings was very limited, in the sense that he only assisted the petitioner-tenant and came forward as her witness and produced the deed and said that he was the owner of the property bearing door No. 109-D/6. As would be seen hereafter, there is a considerable doubt whether the property bearing municipal door No. 109-D/6 is the same as the property bearing door No. 109-D/6. Even apart from this the title of Jagadisan cannot be adjudicated finally in a summary proceeding arising under Act 18 of 1960. The tenant petitioner can only set up the title in herself or in the alternative claim rights of permanent tenancy as a result of which she can deny the title of the landlord to the property in question. But, in the absence of setting up of title in herself or in the alternative setting up of a claim of right of permanent tenancy in the property in question, the tenant cannot, in my view, invoke the doctrine of jus tertii and vest title in third parties and yet plead that she is bona fide denying the title of the landlord to the property in question. In my view, therefore, the Appellate Authority was right when it said that the denial by the tenant, in the circumstances of the case, is not a bona fide one.

8. Even on the merits, there is a doubt whether the property purchased by Jagadisan under Ex. R-10 which obviously relates to premises bearing door No. 109.D/6 is the same as the suit property bearing municipal door No. 109.D/6-A. It is for the parties to establish in appropriate litigation before the appropriate Court as to who owns which property. It is not, however, open to the petitioner as tenant to deny the title of a Public Officer who succeeded Namasivayam and who let in the petitioner into possession admittedly in the year 1972. There being no other error of jurisdiction or any irregularity in the order, the Civil Revision Petition is dismissed.

9. But, in view of the fact that the petitioner has been driven from pillar to post to fight this litigation for Jagadisan in order to subserve her own interests I feel that she should be given at least six months' time to vacate the premises. Accordingly, the petitioner is granted six months time to vacate.

VCS