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Smart Summary

Factual and Procedural Background

This Second Appeal was brought by Sh. Gopi Krishna challenging the order of the Rent Control Tribunal dated April 21, 1992, which dismissed his appeal and confirmed the order of the Additional Rent Controller dated March 21, 1992. The Additional Rent Controller had dismissed objections filed by the appellant in proceedings initiated by the respondent for recovery of possession of a residential premises under Section 21 of the Delhi Rent Control Act.

Initially, on February 9, 1981, the Arjun Gaurav Trust through its trustee, Sh. Harjit Singh Kochhar, filed a petition under Section 21 seeking permission to create a limited tenancy in respect of a flat at Oberoi Apartments in favor of the appellant for a period of three years. The petitioner stated that he was living in a joint family and would require the premises after three years for his own residential use. The rent was fixed at Rs. 1,700 per month, excluding electricity and water charges.

An earlier tenancy had been created for five years from August 23, 1979, in favor of a previous tenant who died before expiry, leaving the premises vacant. The petitioner sought to create a fresh tenancy for the remaining three years, consistent with his intention to occupy the premises after that period. The Additional Rent Controller granted permission for this limited tenancy after recording statements from both the trustee and the appellant, who agreed to the terms and undertook to use the premises for residential purposes only.

After the expiry of the three-year limited tenancy, the respondent sought possession of the premises, and the appellant filed objections raising various pleas. The lower authorities dismissed these objections, leading to the present appeal.

Legal Issues Presented

  1. Whether the order passed by the Additional Rent Controller granting permission for limited tenancy under Section 21 of the Delhi Rent Control Act was without jurisdiction and thus a nullity.
  2. Whether the objections filed by the appellant after the expiry of the limited tenancy were maintainable and whether the lower authorities erred in dismissing them on a procedural ground.
  3. Whether the facts brought on record during the objection proceedings, which existed at the time of creation of the limited tenancy but were not originally disclosed, could validate the order of the Additional Controller.

Arguments of the Parties

Appellant's Arguments

  • The order of the Additional Controller was a nullity as it was passed without jurisdiction because no facts on record at the time satisfied the Controller that the landlord did not require the premises for three years.
  • The order was mindless and without jurisdiction and should be set aside.
  • The lower authorities wrongly rejected the objections on the ground that they were filed after the expiry of the limited tenancy, without examining the merits.
  • No material was produced to show that the landlord would not require the premises for the three-year period.

Respondent's Arguments

  • The property was held by a Trust for the benefit of two minor sons of the sole trustee, Harjit Singh Kochhar, who resided separately with limited accommodation.
  • The permission under Section 21 was obtained for the benefit of the beneficiaries, with the trustee expressing that the premises would be required after three years when the children would need larger accommodation.
  • Facts brought on record during evidence showed the bona fide need of the landlord's family and beneficiaries, validating the limited tenancy.
  • Reference to the Supreme Court judgment in Shiv Chander Kapoor v. Amar Bose supported the bona fide requirement for limited tenancy even if the exact timing of the need was not precisely objective.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Shrisht Dhawan (Smt) v. M/S Shaw Brothers (1992) 1 SCC 534
  • Permission under Section 21 can only be challenged if vitiated by fraud, collusion, or jurisdictional error.
  • Fraud or collusion must relate to the date permission was granted.
  • Permission carries a presumption of correctness.
  • Objections must be raised before expiry of tenancy except in exceptional circumstances.
  • Lack of reasons in original application does not render permission invalid if facts later justify it.
The court applied these principles to hold that the permission granted was not a nullity despite initial non-disclosure, as facts brought later supported the bona fide requirement.
Shiv Chander Kapoor v. Amar Bose (1990) 1 SCC 234 Landlord's bona fide requirement for limited tenancy need not synchronise precisely with objective timing such as son's marriageable age. The court relied on this precedent to uphold the validity of the limited tenancy created for three years based on the landlord's bona fide plan.

Court's Reasoning and Analysis

The court examined whether the order granting limited tenancy was a nullity for lack of jurisdiction due to absence of relevant facts at the time of the order. It noted that under settled law, permission under Section 21 is presumed correct and can only be challenged on grounds of fraud, collusion, or jurisdictional error. The court emphasized that objections should preferably be raised before expiry of tenancy, except in exceptional cases.

The court acknowledged that the original order did not disclose the existence of the Trust or the beneficiaries, and the trust deed was not initially placed on record. However, facts subsequently brought on record during the objections showed that the property was held by a Trust for two minor sons of the trustee, and the trustee resided in separate accommodation with limited space. These facts existed at the time of the tenancy's creation but were not disclosed then.

Applying the principles from the Supreme Court judgment in Shrisht Dhawan, the court held that the Additional Controller's order could not be considered without jurisdiction or mindless merely because reasons were not disclosed initially. The subsequent evidence satisfied the court that the limited tenancy was granted bona fide, reflecting the landlord's genuine intention that the premises would be required after three years when the children would need larger accommodation.

The court also addressed the appellant's contention that the age difference of the children was immaterial, referring to the Supreme Court's ruling in Shiv Chander Kapoor that the landlord's bona fide plan governs the validity of limited tenancy, not precise timing.

Consequently, the court concluded that the lower authorities erred in dismissing the objections solely on procedural grounds without considering the merits, but on merits, the limited tenancy order was valid and not a nullity.

Holding and Implications

The court DISMISSED the appeal filed by the appellant.

The appellant was granted one month's time to vacate the premises. The parties were directed to bear their own costs.

This decision affirms that an order granting limited tenancy under Section 21 of the Delhi Rent Control Act carries a presumption of correctness and cannot be invalidated merely for lack of initial disclosure if subsequent evidence shows bona fide grounds existed at the time. It also clarifies procedural expectations regarding raising objections before expiry of tenancy while allowing for exceptional circumstances. No new legal precedent was established beyond applying existing Supreme Court principles.

    Gopi Krishna Bubna v. Arjun Gaurav Trust .

    Mr. P.K Bahri, J.— This is a Second Appeal brought by Sh. Gopi Krishna challenging the order of the Rent Control Tribunal dated April 21, 1992 by which he had dismissed the appeal and confirmed the order of the Additional Rent Controller dated March 21, 1992 by which he had dismissed the objections filed by the appellant in proceedings brought by the respondent for having recovery of possession of the premises in question from the appellant under Section 21 of the Delhi Rent Control Act.

    2. Facts of the case lie in a very narrow compass. On February 9, 1981, a petition under Section 21 of the Act was filed by Arjun Gaurav Trust through its trustee Sh. Harjit Singh Kochhar in which a prayer was made that the landlord/ owner be permitted to create limited tenancy in respect of Chateu 43, Second Floor, Oberoi Apartments, 2, Shamnath Marg, Delhi which comprised of two bed-rooms, attached bathroom, balcony, one drawing-cum-dining room and a servant room with attached bath and open terrace, as shown in the map filed alongwith the petition in favour of the appellant mentioning that the applicant was living in a joint family (H.U.F) and after three years, he would require the said accommodation for his own residential use and the rent settled was Rs. 1,700/- per mensem exclusive of electricity and water charges.

    3. Alongwith the application, affidavit of Harjit Singh Kochhar was filed wherein he mentioned that he is the trustee of the said Trust and that earlier the said premises were let out to one Shri Chander Mohan after taking permission under Section 21 of the Act vide order dated August 23, 1979' from the Court of Additional Controller and a tenancy of five years was created w.e.f August 23, 1979 which was to expire on August 22, 1984 but unfortunately Chander Mohan had expired prior to expiry of the said period and premises had fallen vacant and thus, the petitioner was creating fresh tenancy in favour of the appellant for the remaining period of three years as the intention of the petitioner, right from the beginning, was to shift to the said premises after expiry of the aforesaid period of five years and it was again mentioned that the petitioner was staying in the joint family and would be shifting to the premises in question after the expiry of the fixed period of tenancy.

    4. The proposed Lease Agreement was also filed alongwith the said petition. The proposed agreement bear signatures of the said trustee as well as of the appellant. The Additional Controller, to whom the case was marked, had recorded the statements of the said trustee and also of the appellant and in the statement, Sh. Harjit Singh Kochhar had mentioned about the said facts of having let out the premises earlier after taking permission under Section 21 for a period of five years and earlier tenant having died and premises having fallen vacant and that the factum of his living in a joint family house and petitioner not requiring the said premises for a period of three years as the children of the petitioner would require separate larger accommodation after the expiry of said three years and thus, the appellant also made a statement and agreed to take the premises on rent for a period of three years and he gave a further undertaking to use the said premises for residential purposes only. The Additional Controller then passed the usual order of granting the permission for creating the limited tenancy for a period of three years.

    5. After the expiry of the period of three years, after having enjoyed the benefit of the order of the Court creating the limited tenancy and after the respondent had moved an application seeking warrant of possession in respect of the said premises, the appellant thought it fit to come out with the objection petition taking various pleas. It is not necessary for me to reproduce all the pleas taken by the appellant in that objection petition because the learned Counsel for the appellant has challenged the impugned order on a very short ground and has not urged any other points which might have been taken by the appellant in his objection petition.

    6. The only ground urged before me by learned Counsel for the appellant is that the order passed by the Additional Controller was a nullity being without jurisdiction as at the time the order was made, no such facts had come on the record from which the Additional Controller could have satisfied his mind that the landlord did not require the premises in question for a particular period of three years. He has urged that as the order on the face of it is a nullity being without jurisdiction, the appellant is within his right to challenge the said order at any time. He has further urged that even otherwise the evidence which has been recorded by the Additional Controller in the objections filed by the appellant, no material has come on record which could show that the respondent/landlord would not have required the premises only for a period of three years for which the limited tenancy was got created. He has argued that the order of the Controller is a mindless order and being without jurisdiction, should be set aside. He has urged that the two authorities below had not examined the merits of the case and had dismissed the objections of the appellant on the threshold that the same were not maintainable as they had been filed after the expiry of the period of limited tenancy. He has argued that in law, both the authorities below were wrong in rejecting the objections on this short ground.

    7. As far as law is concerned, now it is almost settled and all judgments which have been rendered under Section 21 of the Act have been appraised in a recent judgment of the Supreme Court in case of Shrisht Dhawan (Smt) v. M/S Shaw Brothers., (1992) 1 SCC 534 : A.I.R 1992 Supreme Court 1555 and in the judgment rendered by R.M Sahai, J. certain principles have been culled out which I may reproduce which are given in para 21 of the judgment:—

    (i) Permission granted under Section 21 of the Act can be assailed by the tenant only if it can be established that it was vitiated by fraud or collusion or jurisdictional error which in context of Section 21 is nothing else except fraud and collusion.

    (ii) Fraud or collusion must relate to the date when permission was granted.

    (iii) Permission carries a presumption of correctness which can be permitted to be challenged not only by raising objection but proving it prima facie to the satisfaction of Controller before landlord is called upon to file reply or enter into evidence.

    (iv) No fishing or roving inquiry should be permitted at the stage of execution.

    (v) A permission does not suffer from any of these errors merely because no reason was disclosed in the application at the time of creation of short term tenancy.

    (vi) Availability of sufficient accommodation either at the time of grant of permission or at the stage of execution is not a relevant factor for deciding validity of permission.

    8. I have also been referred to some of the judgments which have been referred in this very judgment and I need not dilate much on the ratio laid down in each of the judgments in view of the principles which have been derived from all these judgments in this particular case. At page 1561, regarding the procedural law on the subject, the Supreme Court has now laid down that any objection to the validity of sanction should be raised prior to the expiry of the lease and the objection must be immediately raised on becoming aware of any fraud or collusion and the tenant may be permitted to raise objection after the expiry of lease only in exceptional circumstances. It is also now clearly laid down that even if there have been given no reasons by the landlord for creating limited tenancy, even then the order would not become without jurisdiction or mindless if in evidence, after objections are filed, the facts are brought on record which show that if they had been there at the time of creation of the tenancy, the Additional Controller could have come to be satisfied that it was a fit case for grant of permission for creating the limited tenancy.

    9. The learned Counsel for the respondent has, on the other hand, pointed out that in the present case, in evidence, it has come out that there was created a Trust in which beneficiaries were the two minor sons of the sole trustee Sh. Harjit Singh Kochhar and this property in question had been purchased in the name of the said Trust obviously for the benefit of the said beneficiaries. He has also pointed out that the two beneficiaries were aged six and nine years respectively at the time of creation of this limited tenancy and it has come out in evidence that Harjit Singh Kochhar with his wife and two children has been residing on the second floor of House No. 71, Sunder Nagar, New Delhi where he was having accommodation of one bed room and a guest room and was sharing the common mess with his father who is residing in the first floor of his house. He has argued that the permission which had been obtained under Section 21 was for the benefit of the two beneficiaries of the Trust to whom the property belonged and obviously those beneficiaries were not to live alone and thus, Harjit Singh Kochhar, their father, who was the sole trustee of that Trust, had expressed himself before the Additional Controller to say that he personifying the beneficiaries would be needing the said premises after expiry of three years when the children would grow in ages and would require larger accommodation.

    10. It is true that if we are to go by the material and the facts disclosed to the Additional Controller at the time of creation of the limited tenancy, perhaps the Court could come to the conclusion that order is mindless and such permission ought not to have been granted because nothing was placed before the Controller to show that the premises are needed for the beneficiaries of any Trust and those beneficiaries were the two children of Harjit Singh who was trustee of the Trust and it was not even disclosed to the Additional Controller at that time that he was the sole trustee. Even the copy of the Trust Deed was not placed before the Additional Controller. It is true that under Section 51 of The Indian Trust Act, the trust property could not be allowed to be used for the benefit of the trustee and when the facts stood as they were, as disclosed before the Additional Controller while seeking permission to create limited tenancy, the order passed by the Additional Controller, to say the least, was not justified.

    11. However, the law has now enabled the respondent/landlord to bring facts on the record as they were existing at the time the sanction was obtained to show that if those facts had been brought to the notice of the Additional Controller, then maybe the order of the Additional Controller would not have been treated as order passed without reasons or mindless order.

    12. In view of the above settled position of law which I have already culled out from the judgment of Smt. Shrisht Dhawan (supra) what should have been decided by the two authorities below was whether the facts, which have come out on the record during the evidence led in the objection petition and which facts were in existence at the time of creation of the limited tenancy, were sufficient to have the satisfaction of the Additional Controller for creating the limited tenancy or not.

    13. Ex.DHW1/1 is the original Trust Deed which has been proved on the record which shows that the beneficiaries of the Trust are the two sons of Harjit Singh Kochhar and Harjit Singh Kochhar is the sole trustee. According to the terms of the Trust, the immovable property could be acquired in the name of the trust for the benefit of the said two beneficiaries and any other beneficiary which may be born out of the wedlock of Harjit Singh Kochhar with his wife Neena Kochhar. Then, agreement entered into with Oberoi Apartments has been proved on the record which is Ex.DHW1/2 which is in the name of the said Trust.

    14. Initially, Counsel for the appellant had tried to argue that the name of Mrs. Neena Kochhar was first typed in this agreement as the prospective vendee but later on, it appears that, the name of Arjun Gaurav Trust had been typed, but this part of the argument was not further pursued and rightly so because looking to the agreement as a whole makes it clear that the agreement is entered with Arjun Gaurav Trust as the prospective vendee and Neena Kochhar had signed this agreement as a witness.

    15. The price of Rs. 1,70,000/- was to be paid by 60 monthly instalments starting from 1st July 1978. The agreement is dated July 30, 1978. Later on, a Sale Deed has also been executed in the name of the said trust on February 21, 1989. Copy of that Sale Deed is also placed on the record which is Mark ‘A’.

    16. Be as it may, the facts are quite clear that at the time the limited tenancy was created, there was a Trust Deed showing the two sons of Harjit Singh as the beneficiaries and agreement had been made for acquiring the said flat, the price of which was to be paid in instalments by the said Trust, and at that time Harjit Singh Kochhar, his wife and two sons were living in the second floor of House No. 71, Sunder Nagar, New Delhi which house, although was mentioned as H.U.F or joint family property, but in evidence it was sought to be proved that the said house, in fact, is owned by Harjit's father.

    17. So, from these facts, could it be said that the order passed by the Additional Controller in creating the limited tenancy was without jurisdiction or not. After all, it is disclosed in the statements made before the Additional Controller that the said house would not be needed for a period of three years and would be needed after expiry of the period of three years as the two sons of Harjit Singh Kochhar were to become somewhat older.

    18. Learned Counsel for the appellant has vehemently argued that the two children were aged about six and nine years and it is not possible to hold that with their gaining the age of nine and twelve years respectively, there would have been any difference as far as the requirement of the premises in question by the said beneficiaries is concerned because according to him, it was not objectively clear or proved that the landlord would not have required the premises for only three years because three years age difference is not at all material in assessing the requirement of the house for a particular period.

    19. It has come out in the statement of Harjit Singh Kochhar that initially five years limited tenancy was got created on the reason that instalments of the price of the house were yet to be paid and it was intended by the family of Harjit Singh that after five years were to expire, the payments would have been over and family would have shifted to its own independent flat and when unfortunately the previous tenant died after expiry of two years only, with the same intention, a limited tenancy was created for a period of remaining three years in favour of the appellant. In proceeding under Section 21, the authorities are not to hold any roving enquiry to assess the needs of the landlord for the demised premises for the purpose of Clause (e) of proviso to Sub-section 1 of Section 14 of Delhi Rent Control Act which lays down the ground for bona fide requirement for residence of landlord and his family members. What is to be assessed in proceedings under Section 21 is only whether a particular landlord bona fide does not require a particular premises for a particular period, meaning thereby, as contemplated and visualised by the landlord at that time, his requirement of the premises would be there after the expiry of the period of three years. It is also not the law that if there takes place any changed circumstances after the creation of the limited tenancy, the landlord is to be deprived the benefit of creation of limited tenancy which had been rightly created on the facts as they existed at the time of creation of the limited tenancy.

    20. Learned Counsel for the respondent has referred to judgment of the Supreme Court in the case of Shiv Chander Kapoor v. Amar Bose, (1990) 1 SCC 234 : A.I.R 1990 Supreme Court 325 where the facts were that a limited tenancy was created and it was mentioned that after the expiry of the limited tenancy, the premises would be needed as the son of the landlord was to become of marriageable age. In facts, it was found that even on the expiry of the limited tenancy, the son would hardly have attained the age of 18/19 years. It was contended by the tenant that the order creating limited tenancy was illegal as the reason given for creating the limited tenancy was, on the face of it, absurd because even after the expiry of the period of limited tenancy, son was not to be considered of having become of marriageable age. The contention was rejected by the Supreme Court.

    21. It was held that it was not necessary that the requirement of the landlord should synchronise with the time factor of the period of his son becoming eligible for marriage. The land lord has to plan his own affairs and if land lord bona fide feels that the premises would not be required for some period and would give some reason for creating the limited tenancy, in that situation, it cannot be said that order passed by the Controller on such facts would be without jurisdiction.

    22. In the present case, from the facts, it is quite clear, which were also facts existing at the time of creation of the limited tenancy, that a Trust was created for the benefit of the said two children in the name of the Trust and it is unimaginable that the children were to live separately from their parents. The requirement has to be seen of the family i.e the father and the mother and the two beneficiaries and keeping in view these facts, we have to see whether a limited tenancy could or could not have been created validly when it was intended by the respondent from the very beginning to create limited tenancy for five years thinking that after expiry of five years when payments have been made regarding the instalments and children would have grown in some ages that they would like to shift in their own flat independently. I do not think from these facts it can be said that there are any jurisdictional omissions in the order of the Additional Controller.

    23. It has also come up in the statement of the appellant himself that he has been visiting Harjit Singh Kochhar's family and it is not disclosed by the appellant in the objection petition or in his statement as to when he actually came to know about the ages of the two children, although it is correct that he might not have been aware of the contents of the Trust Deed till the Trust Deed was filed in the Court. but I need not dwell on this point whether the appellant was right in filing the objections after the expiry of the limited tenancy because on merits, 1 have come to the conclusion that the order passed by the Additional Controller in creating the limited tenancy, in view of the facts which were brought on record by the landlord later on, which facts existed at the time of creation of the limited tenancy, the order of the Additional Controller cannot be considered as a nullity.

    24. The appeal is dismissed but in view of the facts of the case, I leave the parties to bear their own costs. The appellant is granted one month's time for vacating the premises.

    Petition dismissed.
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    Comments

    Gopi Krishna Bubna v. Arjun Gaurav Trust .
    (Sep 14, 1993)