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Case Number

S.A. No. 1696 of 1981

Advocates

T.R. Venkataraman
for Appellant. R. Gandhi
K.B.K. Vasuki and S. Radhakrishnan
for Respondent.

Judges

Mr. Justice G. Ramanujam

Acts

Nadu City Tenants Protection Act, hereinafter referred to as the Act
SECTION 106 TRANSFER OF PROPERTY ACT
Nadu City Tenants Protection Act
City Tenants Protection Act

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Smart Summary

Structured Summary of the Provided Opinion

Factual and Procedural Background

The suit in O. S. No. 1031 of 1975 (District Munsif, Tiruchirapalli) was filed by the respondent seeking ejectment of the defendant and future mesne profits. The plaintiff's pleaded case was that the defendant had been licensed about seven years earlier to tie cattle in a suit property measuring 25 X 15 for a fee of Rs. 10 per month, that the defendant unauthorisedly put up a shed on the wall of the plaintiff's temple, and that the plaintiff revoked the licence by the end of February 1975. The plaintiff alleged the defendant was in arrears of licence fee, was liable to ejection, and that the Tamil Nadu City Tenants Protection Act (the Act) had no application to the case.

The defendant's pleaded case was that he took up the plot about twenty years ago at a monthly ground rent of Rs. 3, constructed a superstructure for residence at a cost of Rs. 1,500 (and periodically renewed it), that ground rent rose to Rs. 10 per month, and that he was entitled to the benefits of the City Tenants Protection Act and could not be ejected. He denied being only a licensee and denied the plaintiff's valuation of the superstructure. The defendant asserted he was not a defaulter.

The trial Court framed four issues: (1) Whether the defendant is a lessee or licensee; (2) Whether the defendant was permitted to put up the superstructure; (3) Whether the defendant is entitled to the benefits of the City Tenants Protection Act; and (4) To what relief the plaintiff is entitled. The trial Court held the defendant to be a licensee (not a lessee), that he was not permitted to erect the superstructure, that the Act applied to the area but did not benefit him because he was not permitted to put up the superstructure, and decreed ejectment and mesne profits at Rs. 10 per month from the date of the plaint until delivery of possession.

The defendant appealed. The lower appellate Court held that, although the defendant might be entitled to the benefits of the Act, he could not continue in possession or purchase under section 9 because the suit property formed part of the temple's outer prakaram and nandavanam and was therefore inalienable; the appellate Court sustained the decree in ejectment.

The present text is a decision on the second appeal arising from that appellate outcome.

Legal Issues Presented

Whether the defendant is a lessee or a licensee of the suit property.
Whether the defendant was permitted to put up the superstructure on the suit property.
Whether the defendant is entitled to the benefits of the Tamil Nadu City Tenants Protection Act (including entitlement under section 9).
Whether the suit property is part of the outer prakaram and nandavanam of the temple and, if so, whether such character renders the land inalienable (affecting entitlement under section 9).
Whether the defendant, even if not entitled to section 9 relief, can claim compensation under section 3 of the Act for the superstructure.
Whether the defendant is entitled to the protections of section 11 of the Act (and whether the lack of a section 11 notice is fatal), or whether such notice has been waived.
What compensation, if any, is payable to the defendant for the superstructure and the quantum of such compensation.

Arguments of the Parties

Plaintiff's (Respondent's) Case

The defendant was only a licensee permitted to tie cattle for Rs. 10 per month (about seven years prior), not a lessee.
The defendant unauthorisedly erected a shed/superstructure on the plaintiff's temple wall; the plaintiff revoked the licence by end of February 1975.
The defendant was in arrears of licence fee and therefore liable to be ejected.
The Tamil Nadu City Tenants Protection Act does not apply to the case (or does not confer protection to the defendant in these facts).
The superstructure's value was alleged by the plaintiff to be Rs. 150.

Defendant's (Appellant's) Case

The defendant alleged he had occupied the plot for about twenty years on payment of a monthly ground rent (initially Rs. 3, later Rs. 10) and constructed a superstructure for residence at a cost of Rs. 1,500, periodically renewed.
The defendant contended he was entitled to the benefits of the City Tenants Protection Act and therefore could not be ejected.
The defendant denied the plaintiff's characterization of him as only a licensee and disputed the plaintiff's valuation of the superstructure (claimed higher value historically).
In the second appeal, counsel raised two principal grounds: (a) the finding that the suit property is part of the outer prakaram and nandavanam is unsupported by the evidence and should be set aside or remitted; and (b) even if the Act applied, the lower appellate Court erred in dismissing the case on inalienability without considering entitlement to relief under sections 3 and 11 (including compensation and validity of the termination notice in view of section 11).

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Sambandam Chetty v. St. Xavier Francis Church	That a Court is entitled to give compensation under section 3 of the Act even though section 9 is not applicable.	Used to support the proposition that the defendant, though not entitled to section 9 relief, is entitled to compensation under section 3 for the superstructure.
Sivananda Gramani v. Mohd. Ismail	That a tenant who cannot claim benefits under section 9 may still claim compensation under section 3 for superstructure erected on the land.	Reinforced the Court's view that non-entitlement to section 9 does not preclude compensation under section 3.
Vedachala Naicker v. Duraiswami Mudaliar	It is open to a tenant to waive protection offered by section 11 and request relief under section 9.	Applied to support the finding that a tenant may waive the right to a section 11 notice and thus cannot later complain of its absence.
Natesa Naicker v. Vedagiri	Following Vedachala Naicker: where a tenant fails to claim benefit of notice under section 11 but files for benefit under section 9, he is taken to have waived the section 11 notice.	Applied to support the conclusion that the defendant's conduct amounted to waiver of any section 11 notice requirement.

Court's Reasoning and Analysis

The Court proceeded in a series of analytical steps tied closely to the parties' pleadings and conduct:

Pleadings and trial record: The Court observed that the plaintiff's pleadings and pre-suit notice (Exhibit A-5) explicitly characterized the suit property as part of the temple's outer prakaram and nandavanam, and the defendant did not specifically deny that allegation in his reply (Exhibit A-1) or in his written statement. Paragraph 3 of the plaint likewise described the property as outer prakaram and part of nandavanam. Given these pleadings and the absence of a specific denial, the Court found that both parties proceeded to trial on the basis that the property was part of the outer prakaram and nandavanam.
Consequences of inaction in pleadings: Because the defendant never contested that characterization during pleadings and later stages, the Court held he could not now seek a fresh trial on that question. The lower appellate Court's finding that the suit property formed part of the outer prakaram and nandavanam was therefore justified.
Inalienability and section 9: Having accepted that the suit property formed part of outer prakaram/nandavanam, the Court accepted the lower appellate Court's view that such land is inalienable (res extra commercium) and that the defendant therefore could not claim the benefit of section 9 of the Act (which would allow him to purchase or continue in possession under certain circumstances).
Entitlement to compensation under section 3 despite section 9 inapplicability: The Court then addressed whether non-entitlement to section 9 extinguished all statutory remedies. Relying on established authorities (cited above), the Court held that even if section 9 does not apply, a tenant/occupier may be entitled to compensation under section 3 for any superstructure erected on the land. The cited precedents were used to establish that the Court may award compensation under section 3 notwithstanding the inapplicability of section 9.
Section 11 (notice) and waiver: The Court noted that no notice under section 11 had been issued; instead, a termination notice under section 106 of the Transfer of Property Act (Exhibit A-5) had been issued. The Court reasoned that if the appellant is a tenant within the Act's scope he would, in principle, be entitled to the benefits of section 11. However, on the facts, the defendant's conduct (failure to assert lack of a section 11 notice in the reply, written statement, or at trial and on appeal) indicated a waiver of any right to insist on a section 11 notice. The Court relied on Vedachala Naicker and Natesa Naicker to conclude that the defendant had waived the section 11 notice requirement; waiver is a question of fact, and the facts here established waiver.
Valuation and quantum of compensation: There was a dispute as to the value of the superstructure: plaintiff's pleaded valuation was Rs. 150; defendant's claimed historical cost was Rs. 1,500 (twenty years earlier). The trial Court had accepted the commissioner's inspection report and fixed the value at Rs. 400. Having considered the nature of the superstructure and materials used (per the commissioner's report), the Court revalued the superstructure at Rs. 750.
Relief fashioned: The Court sustained the decree in ejectment (as passed by the courts below) but directed that, as a condition precedent to executing the decree, the respondent must pay or deposit Rs. 750 as compensation for the superstructure into the trial Court.

Holding and Implications

Core Ruling: The second appeal is allowed in part.

Direct consequences and orders provided in the opinion:

The findings of the courts below that the suit property is part of the outer prakaram and nandavanam are sustained because the defendant did not specifically contest that allegation in pleadings and went to trial on that basis.
Because the property is inalienable as outer prakaram/nandavanam, the defendant is not entitled to relief under section 9 of the Tamil Nadu City Tenants Protection Act.
Notwithstanding non-entitlement to section 9, the defendant is entitled to compensation under section 3 of the Act for the superstructure erected by him on the land; the Court fixes that compensation at Rs. 750.
The defendant is not allowed to rely on non-issue of a section 11 notice because, on the facts, he is taken to have waived any right to insist on such a notice by his conduct (failure to raise the point in reply, written statement, trial or lower appellate stages).
The respondent (plaintiff) is directed to pay or deposit Rs. 750 to the appellant (defendant) or into the trial Court before executing the decree in ejectment.
The second appeal is allowed in part as above; there will be no order as to costs.

Broader precedent: The Court applied existing authorities to support the limited propositions stated (compensation under section 3 despite non-applicability of section 9; waiver of section 11 may be inferred from conduct). The opinion does not purport to establish a new principle beyond those applications.

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N. Balasubramania Iyer v. Sri Ponneswari And Muthu Kumaraswamy Devasthanam By Its Managing Trustee K. Natarajan

The defendant in O. S. No. 1031 of 1975 on the file of the District Munsif, Tiruchirapalli is the appellant herein. The said suit was filed by the respondent for ejectment and for future mesne profits as against the defendant. The plaintiff s case as set out in his plaint is that the defendant had been licensed to tie his cattle in the suit property measuring 25 X 15 about 7 years ago on a fee of Rs. 10 per month, that the defendant unauthorisedly put up a shed on the wall of the plaintiff s temple, that the value of the superstructure put up by the defendant will be worth Rs. 150, that the plaintiff revoked the licence or the lease by the end of February, 1975, that the defendant is in arrears of licence fee, that the defendant is therefore liable to be ejected and that the Tamil Nadu City Tenants Protection Act has no application to the case. The plaintiff is therefore entitled to a decree in ejectment as also mesne profits at the rate of Rs. 10 per month.

2. The defendant resisted the suit contending that he took up a plot about 20 years ago on a monthly ground rent of Rs. 3 and constructed the superstructure for his residence at a cost of Rs. 1,500 that the ground rent was gradually increased to Rs. 10 per month, that the superstructure was periodically renewed, and that he is entitled to the benefits of the City Tenants Protection Act and therefore he cannot be ejected from the suit property. The plaintiff s allegation that he is only a licensee and that the value of the superstructure is only Rs. 150 is incorrect. The suit is an outcome of spite and ill will borne by the trustees of the plaintiff temple towards the defendant, that the defendant is regularly paying the rent and he is not a defaulter and that, therefore, he is not liable to be evicted from the suit property.

3. On these pleadings the trial Court framed the following four issues:

(1) Whether the defendant is a lessee or licensee of the suit property?

(2) Whether the defendant has been permitted to put up the superstructure?

(3) Whether the defendant is entitled to the benefits of the City Tenants Protection Act?

(4) To what relief is the plaintiff entitled?

After analysing the evidence adduced by the parties, the trial Court held on the first issue that the defendant is only a licensee and not a lessee of the suit property, and on issues 2 and 3 it held that the defendant was not permitted to put up any superstructure and that the Tamil Nadu City Tenants Protection Act, hereinafter referred to as the Act applied to the area after the Act was extended to the suit village but as he was not permitted to put up any superstructure, he is not entitled to the benefits of the said Act. In this view, the trial Court granted a decree in ejectment and a decree for mesne profits at the rate of Rs. 10 per month from the date of plaint till the date of delivery of possession..

4. The defendant took the matter in appeal and the lower appellate Court held that even though the defendant may be entitled to the benefits of the Act, still he cannot continue in possession of the property or purchase the same under section 9 of the Act as the suit property is part of the outer prakaram and nandavanam of the temple, which are normally inalienable and, therefore, the defendant is not entitled to claim the benefits under the Act. In this view, the lower appellate Court sustained the decree in ejectment passed by the trial Court.

5. In this second appeal, the learned counsel for the appellant raised substantially two contentions. (1) The finding of the Courts below that the suit property is part of outer prakaram and nandavanam of the temple cannot be sustained on the basis of the evidence on record and, therefore, that finding should be taken to be vitiated. (2) Once the Act has been extended to the village in question of and the defendant is held to be entitled to the benefits of the Act, the lower appellate Court is wrong in dismissing the suit merely on the ground that the suit property is inalienable or res extra commereium ignoring the obvious fact that even if the defendant is not entitled to the benefits of section 9, still he will be entitled to claim the benefit under sections 3 and 11 of the Act and in this case no compensation has been ordered, nor the validity of the termination notice has been tested with reference to section 11.

6. It is no doubt true that though the trial Court held that the defendant is only a licensee and not a lessee, the lower appellate Court has proceeded on the basis that the defendant is a lessee of the suit property for purposes of deciding the question as to whether he is entitled to the benefits of the Act and ultimately held that though the defendant is entitled to the benefits of the Act, he is not entitled to the benefit of section 9 for the reason that the land which has been leased out is inalienable. The lower appellate Court also held that the trustees had no power to lease a portion of the prakaram and nandavanam.

7. On the first question, the learned counsel for the appellant would say that there was no issue framed by the trial Court as to whether the suit property is part of the out-prakaram and nandavanam of the temple and, therefore, the lower appellate Court was not justified in giving a finding that it is part of outer prakaram and nandavanam of the temple arid, therefore, the matter should be remitted to the trial Court to give a finding on that question. It is seen that even in the copy of the notice, Exhibit A-5 issued on behalf of the plaintiff before filing the suit it has been stated that the suit site is the outer prakaram of the temple and the trustees have no power to lease out the property to the defendant and as such, the defendant is not entitled to the protection under the Act. In the reply notice, Exhibit A-l the defendant has not specifically denied the said averment. Further, in paragraph 3 of the plaint the suit property is mentioned as outer prakaram and part of nandavanam The defendant in his written statement has not denied the said allegation specifically and, therefore, the lower appellate Court proceeded on the basis that both parties went for trial on the basis that the suit property is the outer prakaram of the temple. Having regard to the fact that the defendant had at no stage disputed the fact that the suit property is part of the outer prakaram of the temple, he cannot now ask for a fresh trial on that question. Having regard to the nature of the pleadings, the lower appellate Court appears to be right in holding that the suit property was part of the outer prakaram and nandavanam of the temple. If the suit property is part of the outer prakaram of the temple, then the lower appellate Court s finding that the suit land is inalienable and therefore the defendant is not entitled to claim the benefit of section 9 of the Act cannot be taken exception to.

8. The next question is even though the defendant is held not entitled to the benefit of section 9 of the Act, whether he can claim the benefits of the other provisions of the Act such as sections 3 and 11. In this case the lower Courts held that the defendant is not entitled to the benefits of section 9 of the Act and therefore, decreed the plaintiff s suit. It is well-established that though a lessee is not entitled to claim the benefits under section 9 of the Act, still he will be entitled to compensation under section 3 for any superstructure which he right have erected on the suit property. In Sambandam Chetty v. St. Xavier Francis Church1, it was held that the Court is entitled to give compensation under section 3 of the Act though section 9 is not applicable to the facts and circumstances of the case. In Sivananda Gramani v. Mohd. Ismail2, it was held that although the tenant cannot claim any benefits under section 9 of the Act by reason of the fact that the property would not be deemed to be a land within the meaning of section 9, he would still be entitled to claim compensation under section 3 for the superstructure which he has erected on the land. Thus the legal position is clear that the defendant, though not entitled to claim the benefits i under section 9 of the Act, is entitled to claim compensation under section 3 on his being ejected

9. The further question is whether the tenant is entitled to the benefits of section 11 although he was held not entitled to the benefits of section 9. Admittedly in this case no notice under section 11 of the Act has been issued and a notice of termination as contemplated under section 106 of the Transfer of Property Act alone has been issued which has been marked as Exhibit A-5. If the appellant is held to be a tenant coming within the scope of the Act, then I do not see how he is not entitled to the benefits of section 11. I therefore hold that he is entitled to claim the benefits of section 11. However, on the facts of this case the defendant should be deemed to have waived the notice by his conduct. There was a notice terminating the tenancy under Exhibit A-5 and there was a reply by the defendant under Exhibit A-l. In the reply the defendant never raised the plea that he is entitled to a notice under section 11 of the Act and the notice issued under section 106 of the Transfer of Property Act is invalid. Even in the written statement, the defendant did not take up the plea that the suit is not maintainable in view of lack of notice under section 11. Besides, neither in the trial Court nor in the lower appellate Court he has raised the plea that the suit is not maintainable for non-issue of a notice under section 11. This conduct of the defendant will lead to the inference of waiver of notice on his part. Waiver is a question of fact and facts in this case establish that there has been a waiver on the part of the defendant, and therefore, the suit will lie without the compliance of section 11. In Vedachala Naicker v. Duraiswami Mudaliar3, the Court held that it is open to the tenant to waive protection offered to him under section 11 and request the Court to give the relief provided for in section 9. Natesa Naicker v. Vedagiri4, following the decision in Vedachala Naicker v. Duraiswami Mudaliar3, and held that where a tenant without claiming the benefit of the notice under section 11 merely files an application claiming the benefit under section 9 he must be taken to have lost his right by waiver of the notice under section 11. In this case only at the time of the arguments before this Court the necessity for the issue of a notice under section 11 has been pointed out by the learned counsel and at no earlier stage the defendant claimed the benefit of section 11 I have to therefore hold that section 11 notice has been waived by the defendant.

10. From the above discussion it will be seen that the defendant is entitled, on eject-meat, to claim compensation for the superstructure erected by him on the land. This leads to the further question as to what is the compensation payable to the defendant for his superstructure. In the notice Exhibit A-5 as well as in the plaint the plaintiff has valued the superstructure at Rs. 150 while the defendant has valued the superstructure at Rs. 1,500 on the date of erection which was twenty years ago.

11. The trial Court, after considering the report of the Commissioner who had inspected the superstructure, has determinated the value of the superstructure at Rs. 400. Having regard to the nature of the superstructure and the materials used therein as is seen from the report of commissioner, I value the superstructure at Rs. 750. Therefore, while sustaining the decree in ejectment passed by the Courts below, the respondent is directed to pay to the appellant or deposit into the trial Court a sum of Rs. 750 as compensation for the superstructure before executing the decree in ejectment against the appellant.

12. In the result, the second appeal is allowed in part as indicated above. There will, however, be no order as to costs.

N. Balasubramania Iyer v. Sri Ponneswari And M...