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Sikander Lal Vs. Anand Mohan Bhutani - Court Judgment

LegalCrystal Citation
SubjectTenancy
CourtDelhi High Court
Decided On
Case NumberSecond Appeal No. 84 of 1972
Judge
Reported in12(1976)DLT34
ActsDelhi Rent Control Act, 1958 - Sections 20(2); Municipal Corporation Act, 1957 - Sections 346
AppellantSikander Lal
RespondentAnand Mohan Bhutani
Advocates: R.L. Aggarwal,; P.R. Monga,; S.N. Chopra and;
Cases ReferredMcCarthy v. Coldair Ltd.
Excerpt:
.....by municipal corporation - before building is occupied completion certificate to be obtained by landlord - tenant cannot be given possession in breach of section 346 - tribunal correct in denying possession to tenant. - - it was alleged that in accordance with the terms of the compromise the landlord was required to construct the new building within eight months but after demolishing the premises and digging the foundation the landlord did not construct the building and had thus failed to build the same uptil january 15, 1967. next it was said that the landlord was not completing the building intentionally and with a maid fide object and the tenant who was a medical practitioner and was practicing medicine for the last 20 years in those premises was suffering a great loss in his..........to possess another shop adjacent to the above shop. (5)in case the landlord does not put the tenant in possession of the premises as indicated above the tenant shall be entitled to execute this order and get possession by way of execution through court. (6)the dimensions of the shop to be given to the tenant will not be less than the dimensions of the shop shown in plan ex. at not less than 20' x 16'.' (8) in terms of the compromise t (9) the landlord was to complete the building within a period of eight months from the date of the vacation of the premises. this was not done.(10) on march 7, 1967, the tenant made an application under section 20(2) and 20(3) read with clause (g) of the proviso to section 14(1) of the act. it was alleged that in accordance with the terms of the.....
Judgment:

Avadh Behari, J.

(1) These are two appeals against the order of Rent Control Tribunal dated December 20, 1971. One appeal is by the landlord. The other is by the tenant. This judgment will govern them both.

(2) The tenant Dr. Anand Mohan Bhutani is a medical practitioner. He is an M.B.B.S. Years ago he took on rent a self-contained independent house built on a plot of 230 sq. yards of land. It was a single storeyed house. It was flat No. 9, Block No. 6 on Ajmal Khan Road, Western Extension Area Karol Bagh, New Delhi.

(3) He took the house for residence cum business. He lived and worked there. He took: it on rent from the predecessor-in-interest of the present landlord Sikandar Lal. In 1950 Sikandar Lal purchased the house. The tenant was paying Rs. 110.00 per month as rent.

(4) The landlord thought of demolishing this house. He wanted to construct shops so that he may put the building to a more profitable use. But before that could be done the tenant must go out.

(5) On May 6, 1960, the landlord brought an ejectment application against the tenant on the ground specified in clause (g) of the proviso to Section 14(1) of the Delhi Rent Control Act, 1958 (the Act). He claimed ejectment on the ground of bona fide requirement of the- premises for the purpose of rebuilding which could not be done without the building being vacated by the tenant.

(6) On April 25, 1961. the Additional Controller made an order of eviction of the tenant from the premises in his occupation. The tenant was directed to deliver vacant possession of the premises within a period of three months. The landlord was ordered to commence the work of re-construction within one month from the date of eviction and to complete the new building within a reasonable time. The Controller ascertained from the tenant whether he elected to be placed in occupation of the premises from which he was being evicted. The tenant elected. The Controller recorded the fact of election in his order and said that after reconstruction the landlord will place the tenant in occupation of the premises.

(7) The tenant appealed to the Rent Control Tribunal. His appeal was dismissed on August 16, 1961. He filed a second appeal in the High Court. There the landlord and the tenant entered into a compromise. The terms of the compromise were recorded on 4th October, 1962 and are as under :

(1)Sikandar Lal landlord will get a new plan passed from the authorities concerned by which a kitchen would be constructed on the first floor and the first floor would be used as residence.

(2)On the intimation received from the landlord about the sanction of this plan the tenant will vacate the premises within two months.

(3)The landlord will construct the new premises within eight months from the date the tenant vacates the premises. On reconstruction the tenant will be entitled to get one shop on the ground floor facing the Ajmal Khan Road and abutting on road No. 27 and will also get for his residence; the entire accommodation on first floor. He will pay rent at the rate of 8.5 per cent on the total cost of construction of the part of the premises let out to him.

(4)In case the landlord is not able to complete the building within eight months he will charge half the rent so calculated for as much period in excess of eight months for which he is kept out of possession. In case the landlord does not construct the first floor in eight months and has constructed the ground floor the tenant will be entitled to possess another shop adjacent to the above shop.

(5)In case the landlord does not put the tenant in possession of the premises as indicated above the tenant shall be entitled to execute this order and get possession by way of execution through Court.

(6)The dimensions of the shop to be given to the tenant will not be less than the dimensions of the shop shown in plan Ex. at not less than 20' X 16'.'

(8) In terms of the compromise t

(9) The landlord was to complete the building within a period of eight months from the date of the vacation of the premises. This was not done.

(10) On March 7, 1967, the tenant made an application under Section 20(2) and 20(3) read with clause (g) of the proviso to Section 14(1) of the Act. It was alleged that in accordance with the terms of the compromise the landlord was required to construct the new building within eight months but after demolishing the premises and digging the foundation the landlord did not construct the building and had thus failed to build the same uptil January 15, 1967. Next it was said that the landlord was not completing the building intentionally and with a maid fide object and the tenant who was a medical practitioner and was practicing medicine for the last 20 years in those premises was suffering a great loss in his medical profession. The tenant prayed that the landlord be directed to put him in possession of the premises as per terms of the compromise.

(11) The landlord resisted this application. But all that he said was that having started the construction in time he could not owing to circumstances beyond his control keep with the progress of the construction and there was no question of mala fides and there was no intentional or voluntary default on his part. He denied that the tenant had suffered any loss.

(12) The Additional Controller by order dated August 18, 1969, came to the following conclusions : 1. That the building is lying incomplete.

2.that Section 346 of the Delhi Municipal Corporation Act prohibited the occupation of an incomplete building by a tenant.

3. that the landlord was intentionally delaying the completion of the building 'perhaps with some ulterior motive'.

4. that it was a fit case where compensation should be awarded to the tenant.

(13) The Additional Controller assessed the compensation at Rs. 1.40,000.00 and made an order directing the landlord to pay the said sum to the tenant within one month of the order,

(14) Both the landlord and the tenant went in appeal to the tribunal. On behalf of the landlord it was argued that that the Addi- tional Controller's assessment of damages was far too high. On behalf of the tenant it was said that the Additional Controller ought to have placed the tenant in occupation of the premises and that a mere award of damages was not sufficient.

(15) The Tribunal dismissed boih the appeals. It confirmed all the findings of fact of the Additional Controller.

(16) As a result of the two decisions of the subordinate authorities we have the following unanimous findings : 1. that the building is lying incomplete. In fact this is the tenant's own case.

2.that in view of the provisions of Section 346 of the Municipal Corporation Act an order for possession cannot be made in favor of the tenant.

3. that the landlord has not given any cogent reason for not completing the building.

4. that award of compensation is the more appropriate remedy in this case.

5. that the tenant is entitled to get Rs. l,40,000.00 on account of compensation from the landlord.

(17) Against these unanimous findings both the landlord and the tenant appeal to this court.

(18) Let me at once deal with the submission of the tenant that an order for possession should be made in his favor. It was argued that the pillars have been constructed and roofs have been laid. Only partilion walls remain to be erected. After that finishing work will be done. It was said that the tenant was prepared to do all this himself and that he should, thereforee, be placed in possession of the two shops which the landlord had agreed to give him under the compromise. Both the Additional Controller and the tribunal rejected this submission. The Tribunal said:

'THElearned Additional Controller was correct in giving the second relief. It was not a fit case for directing the landlord to place the tenant in occupation of the premises because the premises are incomplete and are not fit for occupation'.

(19) I agree with the Tribunal. This is not a case where possession can be given to the tenant. The main reason is that the building is lying incomplete. A lot more remains to be done. Then there is the insuperable barrier of Section 346 of the Municipal Corporation Act. Sub-section (2) of that Section provides that no person shall occupy or permit to be occupied any such building or use or permit to be used any building or a part thereof effected by any such work until permission has been granted by the Commissioner in this behalf in accordance with bye-laws made under that Act. Before a building is occupied a completion certificate has to be obtained. It seems to me that the landlord is the right person to apply for a completion certificate. The tenant cannot do so on his behalf in respect of two shops only. His interest is limited only to that part of the building. An order for possession will be in breach of Section 346. This court cannot be a party to it. I, thereforee, think that the authorities were right in refusing the tenant's prayer for an order of possession in his favor.

(20) Substantially speaking there is only one question in these appeals. What compensation should be awarded to the tenant How much? The landlord says that the award of Rs. 1,40,000.00 is too high. The tenant says it is too low.

(21) Under the compromise the tenant is entitled to get back the possession of one shop and the entire first floor. In case the first floor is not constructed he is entitled to two shops, each measuling 20' X 16'.

(22) To prove the value of the tenancy rights the tenant produced in evidence a copy of the order passed by D. K. Mahajan, J. on November 29, 1962, in the case of Ishwar Dass v. M/s. M. R. Salwan & Sons (A/2). This judgment shows that the landlord in that case also claimed eviction of his tenants under clause (g) of the proviso to Section 14(1) of the Act. It was agreed that the tenants would vacate the premises within a particular period and the landlord would then reconstruct the building and hand over the possession to the tenants. It was further provided that in case the landlord failed to hand over possession he would pay Rs. 60,000.00 for each shop as compensation. In that case the shop was 8' X 8'. The shops were situated on this very road. viz.. Ajmal Khan Road.

(23) The Additional Controller thought that the compensation to which the tenant should be entitled would be the value of the tenancy rights which the tenant would lose on account of the fact that he will not get possession of the premises inspire of an order having been made in his favor.

(24) On the analogy of the order produced before him he assessed compensation at Rs. 70,000.00 per shop, the shops in the present case being much bigger in size. He awarded Rs. 1,40,000.00 to the tenant for the two shops. In this assessment of compensation the Tribunal agreed with the Additional Controller. The tribunal said:

'BYthe act of the landlord in not completing the construction within reasonable time the tenant has been deprived of the tenancy rights of these two shops and, thereforee, he was entitled to the value of those shops.'

(25) Ajmal Khan Road is one of the most fashionable localities of Delhi. .It is a prominent commercial centre. New businesses and shops have sprung up during the years this litigation was being faught in courts. Things have very much changed now. If the tenancy rights of the two shops which were agreed to be handed over to the tenant in the building in question were to be auctioned today there can be no doubt that they would fetch huge amounts. That the tenancy rights arc very valuable in these days cannot be denied. If for a shop measuring 8' X 8' a landlord in 1962 agreed to pay Rs. 60,000.00 as compensation it cannot be said by any stretch of reasoning that the Additional Controller's assessment was over generous. Naturally this assessment depends, as such assessments always do, upon many imponderables. I do not consider that this was over generous nor do I think that it was mean but about right in all the circumstances.

(26) The counsel has argued that the tenant should be paid compensation at double the amount of Rs. 60,000.00 . He said shops in the instant case are bigger in size than in the case decided by Mahajan J. In answer I would say this: At the end of the day arithmetic may have to be mitigated by commonsense. (See Deniel v. Jones (1961) 1 W.L.R. 1103).

(27) SUB-SECTIONS (2) and (3) of Section 20 of the Act read :

'20.(2) if the tenant delivers possession on or before the date specified in the order, the landlord shall, on the complesion of the work of repairs or building or re-building place the tenant in occupation of the promises or part thereof.

(3)If, after the tenant has delivered possession on or before the date specified in the order, the landlord fails to commence She work of repairs or building or re-building within one month of the specified date or fails to compiei.e the work in a reasonable time or having completed the work, fails to place the tenant in occupation of the premises in accordance with sub-section (2), the Controller may, on an application made to him in this behalf by the tenant within such time as may be prescribed, order the landlord to place his tenant in occupation of the premises or part thereof or to pay to the tenant such compensation as the Controller thinks fit.'

(28) SUB-SECTION (3) speaks of three contingencies. (1) where the landlord fails to commence the work of reconstruction ; (2) where the landlord fails to complete the work of building within a reasonble time and (3) where having completed the work the landlord tails to put the tenant in occupation of the premies. (See: Smt. Amar Kaur v. Umrao Singh, : AIR1971Delhi270 ) .

(29) The present case Falls within the second category. This being so, the tenant is entitled to one of the two remedies, either possession of the premises or compensation. The Act leaves it to the Controller to determine which relief he would give to the tenant in a particular case. The Act gives him full discretion to decide. He decides in the circumstances of each case which remedy would be more appropriate: See: Naide v. Nanneh, 1960 Plr 451.

(30) On the facts and circumstances of the present ease I am not prepared to differ from the Rent Control authorities that it is a case in which an award of compensation ought to be made.

(31) It is true that the Act does not lay down the principles on which compensation is to be awarded to a tenant in such like cases. There is no statutory schedule. There is no statutory measure of damages. The Controller has to decide in each case what ought to be the fair assessment.

(32) The statement of the general rule from which one must always start in resolving a problem as to measure of damages has its origin in the speech of Lord Blackburn in Livingstone v. Rawyards Co. (1880) 5 A C 25 (39). He there defined the measure of damages as:

THATsum of money which will put the party who has been injured, or who has suffered, in the same position as he would have been if he had not sustained the wrong for which he is now getting his compensation or reparation.'

(33) Since 1880 this statement has been consistently referred to and cited with approval. It has been restated in similar language by subsequent judges.

(34) The statement of principle is simple. Its application is always difficult. In awarding damages the court is attempting to equate incommensurables. The choice of the right order of figure is empirical: See Bastow v. Bagley 1961(1) W.L.R. 1494 (per Diplock LJ)

(35) As recently as 1963 Upjohn Lj was moved to remark that:

'THEassessment of damages has never been an exact science; it is essentially practical.' (Charter house Credit v. Tolly 1963(2) Qb 683(712).

(36) The underlying theme of damages, the fundamental object of an award, have been restated many times.

'IT is well settled that the governing purpose of damages is to put the party whose rights have been violated in the same position so far as money can do, as if his rights have been observed.' (Per Asquith Lj in Victoria Loundary Ltd. v. Newman Industries Ltd. (1949) 2 K.B. 528.

(37) In this case the damages are whatever loss results to the injured tenant as a natural consequence of the wrongful act of the landlord. This naturally would include a number of factors, for instance, the value of the tenancy rights, the loss of two newly built shops in an important commercial locality, expense of setting up in a new place, loss of medical practice, loss of residential facility, low rent which the tenant was paying, the benefit of being an old tenant, the high rent that the tenant will now be required to pay. In a word damages are to be assessed for the total deprivation of the tenancy rights in the two shops which the landlord agreed to hand over to the tenant. It is the best that a court can do.

(38) The counsel for the landlord argued that the award of Rs. l,40,000.00 is unfair as being on very high side. He said that the Additional Controller was in error in basing his estimate on the precedent of 1962 which is embodied in the order of D. K. Mahajan J. It was said that this was not compensation fixed by a court but was the creature of an agreement between the partics. He further said that it was penal in nature and should not have been followed. I do not agree. When there is nothing else to guide the steps of a judge in the ill-lit winding by-lanes a precedent such as the Additional Controller had before him afforded good guidance in the circumstances of the case. An agreement nonetheless is a convenient peg on which to hang an assessment of damages.

(39) That it is penal in nature is not a sound argument. Punitive considerations have always continued to infiltrate into the law of damages-sometimes by direct and sometimes by oblique methods.

(40) The conduct of the landlord has also to be taken into account in assessing damages. The landlord has not given any reasons for no completing the building which he has left in the middle. He did not take the authorities into confidence. He did not disclose the reasons for his inability to complete the building. What are the 'unforeseen circumstances' we have not been told.

(41) The landlord did not enter the witness box. His attorney said in evidence that the house could not be completed because water was found to be seeping in the foundation. This statement w.is accepted neither by the Additional Controller nor the tribunal. On the contrary both of them held that the landlord was intentionally delaying the completion of the construction of the building because he wanted to keep the tenant out of possession and thereby tire him out. The matter has been hanging fire right from 1967 when the tenant made the application for restoration of possession till this day. One would in such circumstances ultimately think that the landlord does not want to give two shops at the agreed rent to the tenant. He wants to make more profit out of them. If that is so I would think that Rs. 1,40,000.00 is a modest sum.

(42) 'WHERE a defendant' said Lord Devlin in Rookes v. Barnard (1964) Ac 1129 :

'WITHa Cynical disregard for a plaintiff's rights has calculated that the money to be made out of his wrongdoing will probably exceed the damages at risk, it is necessary for the law to show that it cannot be broken with impunity. This category is not confined to money making in the strict sence. It extends to cases in which the defendant is seeking to gain at the expense of the plaintiff some object-perhaps some property which he covets-which he eiiher could not obtain at all or not obtain except at a price greater than lie wants to put down.'

And again:

'WHEREone man is more powerful than another, it is inevitable that he will try to use his power to gain his ends; and if his power is much greater than the other's, he might, perhaps, be said to be using it oppressively. If he uses his power illegally, he must of course pay for his illegality in the ordinary way; but he is not i.e be punished simply because he Is the more powerful.'

(43) Such an award of damages, as Lord Dcvlin said, 'can serve a useful purpose in vindicating the strength of the law.'

(44) The landlord's counsel further argued that the basis of assessment ought to have been the rental value for 20 years as in land acquisition cases or the capitalisation of the tenant's income on the basis of the income-tax returns which were produced on the record. I have no hesitation in rejecting this argument straight-way. Such bases are an affront to commonsense and sense of justice. What we have to consider for the purpose of assessment is the total deprivation of the two new shops which the tenant was to get and not the old house which he vacated. I do not think I should reduce the amount of compensation.

(45) Nor do I think I should increase the amount of damages. The tenant asks me to increase it. I would certainly not do this. I would leave it at Rs. 1,40,000.00 .

(46) The classic statement of the grounds on which the Court of Appeal in England will interlere by reassessment of the damages appears in the judgment of Greer L.J. in Flint v. Lovell (1935) 1 Kb 354. 'This court' he said :

'WILLbe disinclined to reverse the finding of a trial judge as to the amount of damages merely because they think that if they had tried the case in the first instance they would have given a lesser sum. In order to justify reversing the trial judge on the question of the amount of damages it will generally be necessary that this Court should be convinced either that the judge acted upon some wrong principle of law, or that the amount awarded was so extremely high or so very small as to make it, in the judgment of this Court, an entirely erroneous estimate of the damage to which the plaintiff is entitled.'

(47) I think this principle should be followed in this country also.

(48) It has been said that she court would interfere if it said to itself: 'Good gracious me--as high as that.' (Per Denning Lj in McCarthy v. Coldair Ltd. (1951) T.L.R. 1226.

(49) I do not Milk that the subordinate tribunals have applied any wrong principle of law. They have not taken into account irrelevant factors. They have not left out of consideration relevant ones. The amount awarded is neither inordinately low nor inordinately high.

(50) In each case the proper computation is a question of fact (Salmond-torts 15th edition page 765). Under Section 39(2) of the Rent Act an appeal lies to this court on a. ''substantial question of law'. This being so I am not prepared to differ from the concurrent conclusions of the Rent Control authorities on their assessment of damages.

(51) For these reasons I dismiss both the appeals. I leave the parties to bear their own costs.


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