Skip to content


Hindustan Petroleum Corporation Limited Vs. Virupakshappa Channabasappa Kotambri - Court Judgment

LegalCrystal Citation
SubjectTenancy
CourtKarnataka High Court
Decided On
Case NumberCivil Revn. Petition No. 4037 of 1981
Judge
Reported inAIR1982Kant275; ILR1982KAR1; 1982(2)KarLJ121
ActsKarnataka Rent Control Act, 1961 - Sections 50; Esso (Acquisition of Undertakings in India) Act, 1974), Sections 5 (1) and 5(2)
AppellantHindustan Petroleum Corporation Limited
RespondentVirupakshappa Channabasappa Kotambri
Appellant AdvocateH. Sulaiman Sait, Adv.
Respondent AdvocateT.S. Ramachandra, Adv.
Excerpt:
.....the petition premises bona fide and reasonably for his own use and occupation and that greater hardship would be caused to him if eviction is refused, and that no comparative hardship would be caused to the tenant if eviction is ordered. happy homes (p. a sub-tenant, like the statutory tenant, has only a personal right or privilege. it clearly follows that a statutory tenant has no estate or right in the property. thus in order to avoid such contentions and the resultant confusion it would be better if the word 'premises' is used in the karnataka rent control act. 24. in view of the fact that the revision petition has failed mostly on the interpretation of the provisions of the esso act, i think that the interest of justice would be met if all the parties are ordered to bear their..........which reads thus:-'5. (1) where any property is held in india by esso under any lease or under any right of tenancy, the central government shall, on and from the appointed day, be deemed to have become the lessee or tenant, as the case may be, in respect of such property as if the lease or tenancy in relation to such property had been granted to the central government and thereupon all the rights under such lease or tenancy shall be deemed to have been transferred to and vested in the central government.(2) on the expiry of the term of any lease or tenancy referred to in sub-section (1) , such lease or tenancy shall, if so desired by the central government be renewed on the same terms and conditions on which the lease or tenancy was held by the esso immediately before the appointed.....
Judgment:
ORDER

1. The present revision petition is directed against the order dated Sept. 25, 1981 made by the District Judge, Dharwar, in C. R. P. No. 46 of 1977 confirming the order of the Munsiff, Hubli, in H. R. C. No. 173 of 1971, dated Jan. 20, 1977.

2. The respondent is the petitioner in H. R. C. No. 173 of 1971 on the file of the Munsiff, Hubli. For the purpose of proper understanding, the position of the parties in the Court below would be referred to hereafter in this order.

3. The petitioner-landlord filed an eviction petition u/s. 21(1)(h) read with (1) of the Karnataka Rent Control Act, contending that be required the petition premises bonafide and reasonably for his own use and occupation and that greater hardship would be caused to him if the eviction is refused and that no comparative hardship would be caused to the respondent-tenant if eviction is ordered.

4. The respondent resisted the petition by denying all the petition averments.

5. The trial Court recorded the evidence of the petitioner and of two witnesses on behalf of the respondent-tenant and marked the documents Exhibits P-1 to P-6 and Exhibits D-1 to D-5 and ultimately concluded that the petitioner-landlord had proved that be required the petition premises bona fide and reasonably for his own use and occupation and that greater hardships would be caused to the petitioner landlord if eviction was refused and that no comparative hardship would be caused to the tenant if the eviction was ordered. These conclusions of the trial Court came to be affirmed in C.R.P. No. 46 of 1977 by the District Judge at Dharwar by his order dated Sept. 25, 1981.

6. Therefore, the findings recorded by the Courts below that the petitioner-landlord required the petition premises bona fide for his own use and occupation, and that greater hardship would be caused to the petitioner landlord if eviction was refused, and that no comparative hardship would be caused to the tenant if eviction was ordered, are pure questions of fact. In view of the concurrent findings of facts, it is neither feasible nor proper for this Court in revision to interfere with those concurrent findings of f acts. Even on a consideration of the evidence, I am satisfied that the petitioner-landlord has proved that he requires the petition premises bona fide and reasonably for his own use and occupation and that greater hardship would be caused to him if eviction is refused, and that no comparative hardship would be caused to the tenant if eviction is ordered.

7. Shri M. Sulaintan Sait, learned counsel for the tenant, relied on S. 5(1) and (2) and S. 7(3) of the Esso (Acquisition of Undertakings in India) Act, 1974 (hereinafter referred to as 'the Esso Act'). The said Act received the assent of the President on March 13, 1974 and it was published in the Gazette of India Extraordinary dated July 15, 1974. Therefore, the said Esso Act came into force with effect from July 15, 1974.

8. The material facts are that the petition site was taken on lease by M/s. Standard Vaccurn Oil Company on Sept. 14, 1951 for.the first time from the predecessor-in-title of the petitioner-landlord. It is undisputed that under the said lease, an option to continue the lease for another 9 years had been given to the Company. It is undisputed that the successor of the said Company exercised that option and continued in possession of the petition property for 9 years. Thus, it is undisputed that there was a contractual relationship of landlord and tenant between the petitioner and the successor of the said company till Sept., 1969. It is undisputed that the contractual relationship of landlord and tenant came to an end in Sept. 1969.

9. Thereafter, a quit notice was issued by the landlord to the tenant i.e., successor of the said Company in 1969 terminating the tenancy. Whether the issuance of quit notice was necessary at all is not of much importance at this stage. At that time, it was rather an established principle of law that before initiating the proceedings under the Karnataka Rent Control Act, the quit notice was necessary. That principle did not receive the approval of the Supreme Court in V. Dbanapal Chettiar v. Yesodai Ammal : [1980]1SCR334 . But, however, the fact remains that there was no contractual relationship of landlord and tenant between the parties after the efflux of time which took place in Sept., 1969.

10. According to Shri M. Sulaiman Sait, learned counsel for the tenant, the alleged tenant continued to be in possession of the property by virtue of the protection given to him under the provisions of the Karnataka Rent Control Act.

11. It is undisputed that the tenant who took the site on lease, has constructed a building on the petition site for the purpose of running the petrol bunk and sale of petroleum products. It is also undisputed that the contract between the parties provided that the tenant on the expiry of the lease should demolish the building constructed by him and hand over the vacant possession of the site to the landlord. It is undisputed that M/s. Hindustan Petroleum Corporation Ltd. which is a Government Company, took over the rights, liabilities and the business of the Esso Company and thus became the successor of the Esso Company. Learned counsel Shri M. Sulaiman Sait quoted S. 5 of the Esso Act which reads thus:-

'5. (1) Where any property is held in India by Esso under any lease or under any right of tenancy, the Central Government shall, on and from the appointed day, be deemed to have become the lessee or tenant, as the case may be, in respect of such property as if the lease or tenancy in relation to such property had been granted to the Central Government and thereupon all the rights under such lease or tenancy shall be deemed to have been transferred to and vested in the Central Government.

(2) On the expiry of the term of any lease or tenancy referred to in sub-section (1) , such lease or tenancy shall, if so desired by the Central Government be renewed on the same terms and conditions on which the lease or tenancy was held by the Esso immediately before the appointed day.'

(Underlining is mine.)

Therefore, it becomes clear that in order to attract the operation of S. 5(1) of the Esso Act, (i) the Esso Company must hold the property under any lease or under any right of tenancy; (ii) the Central Government shall, on and from the appointed day, be deemed to have become the lessee or tenancy in respect of such property as if the lease or tenancy in relation to such property had been granted to the Central Government; and (iii)-- such tease or tenancy shall, if so desired by the Central Government, be renewed on the same terms and conditions on which the lease or tenancy was held by Esso immediately before the appointed day, on the expiry of the term of any lease or tenancy referred to in sub-section (1).

12. It is undisputed that the Esso had held the property under a lease or under a right of tenancy till. Sept. 1969. The lease came to an end in Sept.1969. The contractual tenancy also came to an end in Sept.1969.

13. shri M. Sulaiman Sait, learned counsel for the tenant, argued that even after the expiry of the contractual tenancy, the Esso Company had the right of tenancy in the sense that it was protected from being evicted and thus it had a right to continue in occupation of the premises. As already stated above, the contractual lease contemplated by S. 5(1) of the Esso Act had come to an end in Sept., 1969. The only ground under which Shri Sulaiman Sait tried to come in, was under the heading of right of tenancy. As indicated above, the contractual tenancy had come to an end in Sept., 1969. Tbus, the alleged tenant had no right of tenancy as such when the lease stood determined by efflux of time in Sept. 1969.

14. Whether the so-called tenant continued to have a right of tenancy under the provisions of the Karnataka Rent Control Act only remains to be seen. Under the Karnataka Rent Control Act, the landlord does not get any right to evict the tenant from the premises immediately after the efflux of time. He will have to pursue his remedy, if possible, u/s. 21 of the Karnataka Rent Control Act. The word 'tenant' is used in a sense different in the Rent Control Act from that found in the Transfer of Property Act or under the general law of the land. That concept of a statutory tenancy has been defined for a purpose and it is generally described as a statutory tenancy. In order to appreciate this rather artificial, arbitrary and queer concept of statutory tenancy, it is important to remember the connotation of the word 'tenant' as found in the T. P. Act. Section 105 of the T. P. Act defines the word lease. Section 106 speaks of the duration of certain leases in the absence of written contract or legal usage. Section 107 describes the mode as to how leases are made or are to be made. Section 108 gives the rights and liabilities of the lessor and the lessee. Section 109 speaks of the rights of the lessor-transferee. Section III gives the various modes of the determination of lease. Sections 112 and 113 speak about the waiver of forfeiture and the notice to quit. Sections 114 and 114-A provide relief against forfeiture. Section 115 speaks of the effect of holding over. AH these sections are to be found in Chap. V of the T. P. Act which deals exclusively with leases of immoveable property. The statutory tenancy steps in only when the contractual tenancy comes to an end or is determined. A lease under the T. P. Act is not merely a contract between the lessor and the lessee. The word 'lease' as defined by S. 105 of the T. P. Act is a transfer of an interest in the land and it creates a right in rem and vests the same in the lessee. In the case of statutory tenancy however, there is no estate or interest in land vested in the tenant. It is merely a personal right to retain possession of the property which is an immunity from eviction except under certain circumstances. The Supreme Court in Anand Nivas Private Ltd. v. Anandji Kalyanji's Pedhi : [1964]4SCR892 dealing with the case arising under the provisions of the Bombay Rent Act, stated thus (at p. 422) -.-

'A person remaining in occupation of the premises let to him after the determination of or expiry of the period of the tenancy is commonly, though in law not accurately, called a statutory tenant. Such a person is not a tenant at all; he has no estate or interest in the premises occupied by him. He has merely the protection of the statute in that he cannot be turned out so long as-he pays the standard rent and permitted increases,if any, and performs the other conditions of the tenancy. His right to remain in possession after the determination of the contractual tenancy is personal; it is not capable of being transferred or assigned, and devolves on his death only in the manner provided by the statute.'

(Underlining is mine.)

The Supreme Court again in Calcutta Credit Corporation Ltd. v. Happy Homes (P.) Ltd. : [1968]2SCR20 quoted with approval the observations of Denning, L. J., in the case Solomon v. Orwell (1954-1 All ER 874), which reads:-

'When a statutory tenant sublets a part of the premises, he does not thereby confer any estate or interest on the sub-tenants. A statutory tenant has no estate or interest himself, and he cannot carve something out of nothing. A sub-tenant, like the statutory tenant, has only a personal right or privilege. The question is, what is the position of the sub-tenant when the statutory tenancy comes to an end? A statutory tenancy may, of course, come to an end without a notice to quit, e g., by death (if there are no entitled relatives) or by the delivering up of the premises to the landlord. When the statutory tenancy comes to an end, the subtenant's right automatically comes to an end unless there is some statutory protection afforded to him.'

Thus. it clearly follows that a statutory tenant has no estate or right in the property. The Rent Act gives him only a right to continue in possession of the building or the premises so long as he goes on paying the standard rent and permitted increases. Thus, there is no right of tenancy vested in the statutory tenant. If I may say so he has no right of tenancy at all. The only right that he has got is the immunity from being evicted from the petition promises if at all it can be called a right. The immunity from eviction does not amount to a right of tenancy at all. Apart from the immunity from eviction, he has no other rights at all. The word 'tenancy' involves an element of relationship of landlord and tenant and an interest in the demised premises. As already indicated above, the statutory tenant has no interest in the property as such and he has no property at all. Therefore, the concept 1of statutory tenancy does not connote any right of tenancy as such. Therefore, under these circumstances, the contention of Shri Sulaiman Sait that the Esso Company or its successor continued to have a right of tenancy in the property even after the expiry of the lease does not appear to be correct. Therefore, in my opinion, S. 5(1) of the' Esso Act will not be applicable to the facts of the present case.

15. Section 5(2) of the Esso Act reads 'On the expiry of the term of any lease or tenancy referred to in sub-section (1), such lease or tenancy shall, if so desired by the Central Government, be renewed on the the same terms and conditions on which the lease or tenancy was held by Esso immediately before the appointed day .As already shown above, the appointed day used in See. 5 (2) is 15th July, 1974 on which day it was published in the Gazette of India Extraordinary. By July, 1974 the contractual tenancy had already come to an end i.e., in Sept., 1969. Therefore, there. was no subsisting lease or tenancy between the parties in 1974 when the Esso Act came into force. Further it can be seen with advantage that the landlord filed an eviction petition in H. R_ C. No. 173 of 1971 in the Court of the Munsiff, Hubli. Therefore, long before the Esso Act came into force, an eviction petition was staring in the face of the so-called tenant. Thus there was neither lease nor tenancy held by the Esso Company immediately before the appointed day. What the Esso Company had immediately before the appointed day was only the immunity from being evicted from the premises which, as already indicated above, does not amount to a right of tenancy at an.

16. Further Section 5(2) says that such lease or tenancy shall, if so desired by the Central Government, be renewed on the same terms and conditions. Neither the Central Government nor M/s. Hindustan Petroleum Corporation Ltd. desired the renewal of lease at any time till the revision petition came to be filed in 1977 before the District Judge, Dharwar. Therefore, the Central Government or M/s. Hindustan Petroleum Corporation Ltd. did not express any desire of renewal till C. R. P. No. 46 of 1977 was filed in the District Court. Even though Esso Act was in force in 1977 when the Munsiff disposed of the petition, such a contention though it was a point of law was not taken up or was not urged before the Munsiff himself. Naturally, they did not think of resorting to such a contention because the Corporation rather thought that it could not take up such a contention because there was no lease or right of tenancy vested in the Esso Company immediately before the appointed day The very belated nature of this contention which was taken up for the first time when the Civil Revision Petition was filed in the District Court, would be an indicator that the Hindustan Petroleum Corporation Ltd. thought that they could not ask for the renewal of the lease because there was no lease or right of tenancy subsisting.

17. Further, such a desire to renew the lease must be expressed by the Central Government before the expiry of the lease or the determination of the tenancy. It may be oral or in writing. The phrase 'on the expiry of the term of any lease or tenancy referred to in sub-section (1)' used in S. 5(2) would govern more or less the option of the renewal of the lease. Therefore, in my opinion. the exercise of the option or desire must proceed immediately before the expiry of the lease or the determination of tenancy. If such a desire is not expressed before the expiry of the lease or during the subsistence of the tenancy, Section 5(2) will not come to the rescue of the Central Government or the Hindustan Petroleum Corporation Ltd. If there is no lease or tenancy subsisting at the time when the Central Government desires to renew the lease, the question of the lease or the tenancy being renewed on the same terms and conditions does not arise. If the lease or the tenancy is to be renewed on the same terms and conditions, it only follows that such an exercise of desire must precede the expiry of the term of the lease. As the lease had come to an end in Sept., 1969 the right of tenancy came to an end in Sept., 1969. Admittedly, no such desire of renewal was expressed by the Central Government or the Hindustan Petroleum Corporation Ltd. before the expiry of the lease in Sept., 1969. As already shown above such a contention was raised for the first time only when C. R. P. No. 46 of 1977 was filed in the District Court, Dharwar. Therefore, in my opinion, S. 5(2) also will not come to the rescue of the revision petitioner tenant in this case.

18. Learned counsel Shri Sulaiman Sait argued that the very fact that the Hindustan Petroleum Corporation Ltd. contested the eviction petition in the Munsiff Court was sufficient to indicate that the Central Government or the Hindustan Petroleum Corporation Ltd. expressed its desire to renew. The simple contest of the eviction petition does not amount to a desire to a renewal of the lease. The contest as can be seen from the records was only in respect of the bonafide and reasonable requirement of the landlord and only in respect of the comparative hardship. The eviction petition was contested in order to controvert the claim of the landlord for possession u/s. 21 (1) (h) read with (1) of the Karnataka Rent Control Act. Therefore, such a contest ' in my opinion, does not amount to an expression of a desire to renew the lease.

19. The Esso Act would govern only such leases or tenancies which were in existence or subsisting on the day when the Esso Act came into force. As no lease or tenancy was in existence or subsisting in the case on hand, when the Esso Act came into operation, the question of renewal of lease or tenancy does not arise in this case.

20. The right to possession had become vested in the landlord immediately on the determination of the lease in Sept., 1969. Such a vested right cannot be taken away by the artificial imposition of S. 5(1) and (2) of the Esso Act. Section 5(1) and (2) of the Esso Act would come into play if the desire to renewal was exercised before the expiry of the lease or before the tenancy came to an end. It is no doubt true that this Esso Act has been held to be valid by the Andhra Pradesh High Court in Mustafa Hussain v. Union of India : AIR1981AP283 . On a perusal of all the provisions of the said Esso Act, I do not find that the restriction imposed is an unreasonable one. The said Act is sought to be placed on the anvil only in public interest. If the object behind the said Act is considered, the restriction imposed cannot be said to be unfair or unreasonable. As held by the Andhra Pradesh High Court, Ss. 5(2) and 7(3) do not create perpetual leases. They only lay down that if the Corporations in certain cases exercised their opinion then the lessor has to renew his lease. To that extent there is some statutory compulsion resulting in the restriction on the rights of the lessors. The Supreme Court has also held in M/s. Dwarka Prasad v. State of U. P. : [1954]1SCR803 thus :-

'The phrase reasonable restriction' connotes that the limitation imposed upon a person in enjoyment of a right should not be arbitrary or of an excessive nature beyond what is required in the interest of the public.'

In the light of the enunciation of the principle by the Supreme Court, the restriction imposed by the Esso Act is neither unreasonable nor arbitrary. It is not an exercise of an excessive nature beyond what is required in the interest of the public.

21. Learned counsel Shri Sulaiman Sait then drew my attention to the preamble of the Esso Act to show that such a restriction was in the public interest and was not an unreasonable one. I have already stated by referring to the Andhra Pradesh High Court ruling and the Supreme Court ruling that the Esso Act in question does not impose any unreasonable restriction and it is in the public interest and the Act is intra vires.

22. Shri T. S. Ramachandra, learned counsel for the landlord, contended that the Karnataka Rent Control Act applied only to a building and not to a vacant site. The preamble to the Karnataka Rent Control Act. reads thus :-

'An act to provide for the control of rents and evictions, for the leasing of buildings, to control rates of hotels and lodging houses and for certain other matters in the State of Karnataka.'

The word 'building' has been defined in Section 3(a) of the Karnataka Rent Control Act thus -.-

'3 (a). 'Building' means any building or but or part of a building or hut other than a farm house. let or to be let separately for residential or non-residential purposes and includes :-

(i) the garden, grounds and outhouses, if any, appurtenant to such building, hut or

part of such building or hut and let or to be let along with such building or but or part of building or hut;

(ii) any furniture supplied by the landlord for the use in such building or hut or part of a building or hut;

(iii) any fittings affixed to such building or part of a building for the more beneficial enjoyment thereof, but does not include a room or other accommodation in a hotel or a lodging house.'

The word 'premises' has been defined in Section 3 (n) as :-

'(n) 'premises' means-

(i) a building as defined in clause (a);

(ii) any land not used for agricultural purposes.'

Therefore, the separate use of 'premises, and 'building' in the Karnataka Rent Control Act has given rise to only serious arguments by the learned counsel Shri T. S. Ramachandra before me. It becomes clear that the word 'premises' includes building. Thus in order to avoid such contentions and the resultant confusion it would be better if the word 'premises' is used in the Karnataka Rent Control Act. I am sure that the Legislature in order to put an end to the controversy and confusion would step in to remedy the anomaly in the matter.

23. In the result, this revision petition fails and it is dismissed.

24. In view of the fact that the revision Petition has failed mostly on the interpretation of the provisions of the Esso Act, I think that the interest of justice would be met if all the parties are ordered to bear their own costs in this revision petition.

25. Learned counsel Shri Sulaiman Sait at this stage sought for a certificate to appeal to the Supreme Court under Art. 134A of the Constitution. Article 134A applies to cases coming within the ambit of Clause (1) of Art. 132, or clause (1) of Art. 133 or clause (1) of Art. 134 of the Constitution. Article 132(1) would apply to matters involving a substantial question of law as to interpretation of the Constitution. There is no question of the interpretation of the Constitution involved in this case. Article 133(1) of the Constitution does not govern the case of judgment of a single Judge of the High Court. Article 134 of the Constitution applies only to criminal matters. Therefore, the certificate prayed for by the learned counsel Shri Sulaiman Sait cannot be granted. But, however, it involved a substantial question of the interpretation of S. 5(1) and (2) of the Esso Act. This case is of substantial importance or relevanc4 to the Hindustan Petroleum Corporation Ltd. as it has got various business premises in different parts of the country. Therefore the interest of justice demands that the order passed by me should be stayed for 3 months from today and it is accordingly stayed for 3 months from today.

26. Revision dismissed.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //