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Bismilla Jan Vs. JaIn Tractors and Auto Spare - Court Judgment

LegalCrystal Citation
SubjectTenancy
CourtDelhi High Court
Decided On
Case NumberCivil Writ Appeal No. 471 of 1972
Judge
Reported in1985RLR477
ActsSlum Areas(I&C) Act - Sections 19(4)
AppellantBismilla Jan
RespondentJaIn Tractors and Auto Spare
Advocates: Maheshwar Dayal and; G.N. Aggarwal, Advs
Excerpt:
.....that the two factors which have to be taken into consideration are :(a) the availability of alternate accommodation & (b) the financial status of the tenant in order to find out whether he would be in a position to get alternate accommodation in case he was evicted or whether he was likely to create slums. shri paras nath, managing director of the respondent firm has specifically stated in para 14 of his affidadavit, dated 1.9.1971 that the respondent firm will not be able to acquire alternate accomodation equal to the premises in dispute in the same area or in any other commercial area of motor parts business in a city like delhi for any amount of rent, besides huge amount of 'pagri money'.this specific averment of the respondent firm has not been denied specifically by the..........slums with interim protection for the slum dwellers until they are moved into better dwelling. the comp. auth. are given sufficient discretion under the slum act to ascertain whether the tenant, who has accommodation in the slum area, is likely to create further slums, if evicted. while exercising this discretion, however the comp. auth. can take into account only the factors mentioned in s. 19(4) of the slum act. it is well settled that the two factors which have to be taken into consideration are : (a) the availability of alternate accommodation & (b) the financial status of the tenant in order to find out whether he would be in a position to get alternate accommodation in case he was evicted or whether he was likely to create slums. (3) for finding out whether alternate accommodation.....
Judgment:

Sunanda Bhandare, J.

(1) COMP. Authority held that Respdt. was not earning much and declined permission. Order was upheld in appeal by Fin. Comm. Petitioned moved High Court. After detailing above facts, judgment proceeds]

(2) The object of the Slum Act is the orderly elimination of slums with interim protection for the slum dwellers until they are moved into better dwelling. The Comp. Auth. are given sufficient discretion under the Slum Act to ascertain whether the tenant, who has accommodation in the slum area, is likely to create further slums, if evicted. While exercising this discretion, however the Comp. Auth. can take into account only the factors mentioned in S. 19(4) of the Slum Act. It is well settled that the two factors which have to be taken into consideration are : (a) the availability of alternate accommodation & (b) the financial status of the tenant in order to find out whether he would be in a position to get alternate accommodation in case he was evicted or whether he was likely to create slums.

(3) For finding out whether alternate accommodation within the means of the tenant would be available to him, the Comp. Auth. has to inquire into the question of the means of the tenant. A landlord, who files the petition u/s 19, alleging that the tenant has sufficient means would not naturally be in a position to know the exact income of the tenant. However, while filing the petition for permission u/s 19 for institution of eviction proceedings against the tenant he has to allege what according to his knowledge or information is the income of the tenant and adduce such evidence as is possible for him to place before the Comp. Auth. Once the landlord has done that, it is for the tenant to adduce positive evidence regarding his income which is especially within his knowledge. [Petitioner applied to Comp. Auth. On 23.5.70 for permission u/s 19 to sue respondent for eviction, Respdt. was doing business of Auto Spare parts in tenanted premises.

(4) COMP. Auth. in the present case on a specific averment made by the petitioner that alternate accommodation bearing No. 1470, Rang Mahal, was being used as a registered office by the tenant, inspected the premises and made a report on 6.10.71. In his report, he observed that the premised 1470, Rang Mahal comprised of dingy, dusty, foul-smelling suffocating, covered with spider webs, having no ventilation and uneven floors. The premises presented of a look of a godown and, thereforee, the premises could not be used as alternate accommodation in place of the disputed premises, which is situated in the main tyre market. It was stated in the report that the alternate accommodation was at a distance of 50 yards from the disputed premises in a lane in which there was not a single shop which deals in tyres. While dealing with the questions of status, the Comp. Auth. observed that the income-tax assessment returns filed by the company for the year 1967-68 and 1969-70 were of no avail as no orders of assessment were passed thereon. thereforee, he relied on the balance-sheets 'filed by the company. The contention of the petitioner that by an order dated 23.3.71 the Ito had not accepted the balance-sheets filed by the company, and thereforee, the balance- sheets filed for the subsequent years cannot be relied upon, was not accepted. While accepting the balance-sheets and coming to the conclusion that the company does not have sufficient means to get alternate accommodation, the Comp. Autho. observed :-

'I,therefore relying upon the balance- sheet hold that the respondent firm is running into a loss of Rs. 1,359.00 for the year 1970. Even if for the sake of argument, it be assumed that alleged advances are simply paper transactions to their own firms as Shri Paras Nath, Managing Director, is running several 'firms, as is evident from the Calendar, filed by the petitioner, the only adverse inference which can be drawn is that the respondent firm must be earning commercial interest of 12% P. a. over these advances. The learned Financial Commissioner has calculated this figure at Rs. 10,000.00 p.a, in his order dated 17.3.71. By adding gross profits of Rs. 4,424.00 this figure would come to Rs. 14,424.00per annum i.e. Rs. 1,202.00 p.m. The respondent is in possession of covered area of more than 1,000.00 sq. ft. Shri Paras Nath, 'Managing Director of the respondent firm has specifically stated in para 14 of his affidadavit, dated 1.9.1971 that the respondent firm will not be able to acquire alternate accomodation equal to the premises in dispute in the same area or in any other commercial area of motor parts business in a city like Delhi for any amount of rent, besides huge amount of 'Pagri money'. This specific averment of the respondent firm has not been denied specifically by the petitioner. From the evidence on record, I am, thereforee, of the opinion that the respondent-firm having a monthly income of Rs. 1,200.00 cannot secure alternate business premises within their means without creating any further slums.'

(5) The Financial Commissioner while dealing with the question of the financial status referred to the argument made by the learned counsel for the petitioner that the balance-sheet as tendered by the respondent suffered from technical flaws of loans and advances as having been shown as a Single unit, held :

'I am afraid I cannot accept the first averment of the learned counsel for the appellant as a perusal of the balance-sheet as placed on record does not show the clubbing together of the loans and advances therein as was so averred to by the learned counsel for the appellant. This was conceded to by the learned counsel when he was so confronted with the copies of the balance-sheet as they existed on the Court's record who accordingly dropped this ground of assailment. The citation relied upon thus having become irrelevant needs no discussion...... As regards the third averment, on the request of the learned counsel for the appellant, books of account of the respondent-firm were sent for and were examined by him in my presence. After a thorough scrutiny, the learned counsel conceded that the balance-sheet as tendered stood supported by the accounts as disclosed to me. In the end the learned counsel very ably conceded that as per the evidence brought on record and explained by the respondent before me, the grounds of assailment as originally contemplated lose force and cannot thus be pressed.'

(6) As far as the question of suitability of alternate accommodation is concerned I find that the competent Authority erred in coming to the conclusion that the registered office which was only 50 yards away was in a lane To which there is not a single shop which deals with tyres and that this accommodation was so dingy and dusty that it had no utility other than that of a godown, and, thereforee, though it was in the possession of the respondent being its registered office, was not to be considered as suitable alternate accommodation. There is no doubt that suitability of the accommodation has to be taken into account while deciding whether the tenant was likely to create any slums if evicted, but that does not mean that the alternate accommodation should be exactly similar or that it should have all amenities, facilities and conveniences which a tenant may be having in the premises from which he is sought to be evicted.

(7) As far as the order of the Fin. Comm. is concerned there is some substance in what the learned counsel for the petitioner contended. It seems that a very novel style of noting the contentions of the petitioner has been adopted and it is observed that almost every point has been conceded by the learned counsel for the petitioner. However, without going into the question whether a particular point was conceded or not, I find that the Fin. Comm. has also missed the main point.

(8) I find that the Comp. Auth. as well as the Fin. Comm. have not applied their mind to the question whether in a case where the tenant is a corporate body the standard for deciding the financial status would be the same as it would be for an individual tenant. The Comp. Auth. in his order, as reproduced above, has observed that the Directors of the company had several other business which were doing very well but relied on the balance- sheets filed by the respondent and held that the company had an income ofRs.1,202.00p.m. which was not sufficient to acquire alternate accommodation equal to the premises in dispute.

(9) In the case of a juristic person while determining the financial status, the standards have necessarily to be different. It is not unknown that in the present days some companies continue to show losses either because of bad management or because the correct income is not shown in the balance-sheets and the income-tax returns. In the present case, the conduct of the respondent-tenant was such that initially it was even denied that the company was assessable to income-tax. It was only when during the course of the evidence when confronted with the assessment returns and the balance-sheets that it was submitted in evidence that the company was being assessed to tax. Even the question regarding the registered office being at another place at Queen's Road was denied originally in the affidavit but later admitted that the place was being shown as registered office in the calendar and the letter-heads though the accommodation belonged to Shri Paras Nath Jain in hi individual capacity. If persons who have financial interest in a Pvt. Ltd. Co. own severe other concerns and are sufficiently rich, no protection is contemplated under the Slum Ac because even if the company, which Is a tenant is going into losses, because even if eviction order is passed the company is not likely to create slums. The Slum Act was enacted for giving protection to poor individual tenants who have small means and cannot afford to get alternate accommodation outside the slum area or within the slum if evicted. If a couple of persons with substantial means float a company which goes into losses, even if they are evicted from the premises, they cannot create slums, particularly when the same persons own other concerns which also have offices at different places. In the present case, the Comp. Auth. had come to the conclusion that the income of the firm was only Rs. 1,202.00 and, thereforee, it would not be in a position to get alternate accommodation in the same area where the tyre market was situated. If this criteria is adopted no company occupying tenanted premises in the notified slum area in the walled city of Delhi can be evicted by a landlord under the Delhi Rent Act, merely because the company is making losses or makes meagre profits. This is a case where an old lady has been trying to seek permission to evict a company carrying on business of spare parts in the tyre market from the premises let out to it, and has been rejected permission only because the company did not show substantial profits. The tenant is admittedly a dealer in motor spare parts, having registered office only 50 yards, away from the disputed premises. In my judgment, this is a fit case where in order to do substantial justice, jurisdiction under Articles 226 and 227 of the Constitution of India, should be exercised particularly because both the authorities below have not considered the basic question regarding the fact that would determine the status of a juristic person. Petition allowed.


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