PADAM NABH & SONS versus YASH PAL on 17 November 2021

[2021] 12 S.C.R. 543

PADAM NABH & SONS

v.

YASH PAL

(Civil Appeal No.5976 of 2014)

NOVEMBER 17, 2021

[HEMANT GUPTA AND V. RAMASUBRAMANIAN, JJ.]

East Punjab Urban Rent Restriction Act, 1949 – s.13-B –Summary jurisdiction – Non-Resident Indian (NRI) who purchaseda building to which the Act applies, subsequent to the induction oftenant is entitled to invoke summary jurisdiction under s.13-B – If aNRI becomes the owner of the building to which the Act applies andthe tenancy of a person in occupation is attorned in his favour, thepremises would become a premises let out by him, as otherwise thejural relationship of landlord and tenant will not come into existence– Once a NRI acquires a premises which is in the occupation of atenant inducted by his predecessor in title, he becomes the owner –The moment the tenancy is attorned in his favour, then the juralrelationship of tenant landlord is created and the premises becomeone let out by him – It is perhaps with a view to highlight this aspectthat the legislature has carefully used the expression “owner” ins.13-B, even while using the expression “landlord” in other places– Rent Control and Eviction.

Rent control legislations: Purpose of enactment – Discussed.

Rent Control and Eviction: While the owner of a premisesmay also be the landlord of the premises, a landlord, within themeaning of the expression under the Rent Control legislations, neednot necessarily be the owner of the said premises.

Dismissing the appeal, the Court

HELD : 1. The shortage of housing and the exploitation oftenants by landlords in the urban areas, in the aftermath of theworld wars, led to the enactment of rent control legislations inthe country. The problems created by the post war conditionsdiffered from State to State and hence, the solution sought to beoffered in the form of legislation also differed from State to State.As a matter of fact the East Punjab Urban Rent Restriction Act,

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A1949 is an offshoot of the Punjab Urban Rent Restriction Act,1941 and the Punjab Urban Rent Restriction Act, 1947, both ofwhich are pre-independent and pre-partition legislation. On thecontrary, the Delhi Act of 1958 is an offshoot of the Delhi andAjmer Rent Control Act, 1952. The areas to which these actsapplied had their own peculiar geographical features and socio-Beconomic conditions. This is why the language employed in theserent control legislations differ, though they may have a commontemplate. [Para 10][554-C-E]

2. Coming to the distinguishing features between the DelhiAct and the East Punjab Act, it may be seen immediately that theCDelhi Act covers four categories of persons, namely,(i) a landlordin occupation of a residential premises allotted to him by theCentral Government or any local authority and who is requiredto vacate such residential accommodation; (ii) a landlord, releasedor retired from armed forces or a dependent of a member of anyDarmed forces who had been killed in action, including a memberof the armed forces who is due to retire within one year; (iii) alandlord who is a retired employee of the Central Governmentor of the Delhi Administration; and (iv) a widow. But under thePunjab Act, the right to seek immediate possession is conferredin favour of only two categories of persons, namely, (i) a specifiedElandlord, meaning thereby a person entitled to receive rent inrespect of a building on his own account and who is holding orhas held an appointment in a public service or post in a connectionwith the affairs of the union or of a State; and (ii) an owner who isa non resident Indian and who returns to India. [Para 11]F[554-F-H; 555-A]

3. While Section 13-A of the East Punjab Act was insertedby amending Act 2 of 1985, Section 13-B was inserted by PunjabAct 9 of 2001. Delhi Act does not contain any special provisionfor the benefit of NRI landlords. It is common knowledge thatGthe major chunk of the NRI diaspora is from three states, namely,Punjab, Andhra Pradesh and Kerala. Therefore, the legislaturethought fit to exempt buildings owned by NRIs from the rigors ofthe Rent Restriction Act. Hence, the normal rule of interpretationof a legislation for the welfare of the tenants, will give way whileinterpreting the provisions as applicable to the exemptedHcategories. [Para 12][555-B-C]

4. While carving out an exception in favour of four categoriesof persons, under Sections 14-A, 14-B, 14-C and 14-D, the DelhiAct used only the word “landlord”. But the Punjab Act uses theword “specified landlord” under Section 13-A and the word“owner” in Section 13-B. There is a world of difference betweenthe expression “landlord” and the expression “owner”. Whilethe owner of a premises may also be the landlord of the premises,a landlord, within the meaning of the expression under the RentControl legislations, need not necessarily be the owner of thesaid premises. Therefore, while interpreting Section 13-B of thePunjab Act, the Court must keep in mind the distinction betweenthose two expressions. [Para 13][555-D-E]

5. The proviso to Sub-section (1) of Section 13-B whichcurtails the right of the owner to invoke this provision for a periodof five years from the date of becoming the owner, makes it clearthat the words “let out by him” require a different interpretation.The correct method of interpreting Sub-section (1) of Section13-B and the proviso thereunder is to hold that irrespective ofthe person by whom the tenant was inducted, a NRI owner willhave to wait for a period of five years from the date of becomingthe owner, to be entitled to invoke Section 13-B. There isdistinction between (i) inception of tenancy or induction of a personas a tenant; and (ii) letting out a premises on lease. Section 13-B(1) does not use the expression “inducted by him or her”. Ifthese words had been used, they would certainly refer to theinception of the tenancy. Section 13(B)(1) uses the expression“let out”. [Paras 14, 15, 16][555-F, H; 556-A, B]

6. Section 106(1) of the Transfer of Property Act, 1882declares that a leasing of immovable property for agricultural ormanufacturing purposes shall be deemed to be a lease from yearto year (in the absence of a contract or local law or usage to thecontrary). It also says that a lease of immovable property for anyother purpose shall be deemed to be a lease from month to month.Once a NRI acquires a premises which is in the occupation of atenant inducted by his predecessor in title, he becomes the owner.The moment the tenancy is attorned in his favour, then the juralrelationship of tenant landlord is created and the premisesbecome one let out by him. It is perhaps with a view to highlight AB

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Athis aspect that the legislature has carefully used the expression“owner” in Section 13-B, even while using the expression“landlord” in other places. [Para 17][556-C-F]

Nathi Devi v. Radha Devi Gupta (2005) 2 SCC 271:[2004] 6 Suppl. SCR 1141 – held inapplicable.B

Smt. Bachan Kaur v. Kabal Singh 2011(1) RCR (Rent)368; S. Surjit Singh Kalra v Union of India & Anr.(1991) 2 SCC 87 : [ 1991] 1 SCR 364; S. Surjit SinghKalra and Kanta Goel v. B.P. Pathak (1977) 2 SCC 814: [1977] 3 SCR 412; Nathi Devi v. Radha Devi GuptaC(2000) 9 SCC 249 – referred to.

Case Law Reference

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 5976of 2014.

EFrom the Judgment and Order dated 08.12.2011 of the High Courtof Punjab and Haryana at Chandigarh in Civil Revision No.1571 of 2010(O&M).

Nidhesh Gupta, Sr. Adv., Ms. Pallavi Singh, Ms. Nidhi Gupta,Japneet Kaur, Vriti Gujral, Tarun Gupta, Advs. for the Appellant.FPardeep Gupta, Parinav Gupta, Dr. Mrs. Vipin Gupta, SubhasishBhowmick, Advs. for the Respondent.

The Judgment of the Court was delivered by

V. RAMASUBRAMANIAN, J.

G1. This appeal arising out of an order of eviction passed by theRent Controller, Shaheed Bhagat Singh Nagar, Nawanshahr, underSection 13-B of the East Punjab Urban Rent Restriction Act, 1949 andconfirmed on revision by the High Court of Punjab and Haryana, raisesan interesting question as to whether a Non-Resident Indian whopurchases a building to which the Act applies, subsequent to the inductionH

PADAM NABH & SONS v. YASH PAL[V. RAMASUBRAMANIAN, J.]

of the tenant, will be entitled to invoke the summary jurisdiction underSub-section (1) of Section 13-B or not.

2. We have heard Mr. Nidhesh Gupta, learned senior counselappearing for the appellant and Mr. Pardeep Gupta, learned counselappearing for the respondent.

3. Admittedly one Shri Padam Nabh, who was the father of theproprietor/partner of the appellant-concern, was inducted as a tenant inrespect of a non residential building measuring about 12’ x 12’, situate atthe Old Grain Market Nawanshahar. The induction of Shri Padam Nabhas a tenant, was by one Sat Prakash.

4. Claiming (i) that the original owner Sat Prakash sold the premisesin question to his father Brij Lal under a sale deed dated 6.2.1989; (ii)that the property devolved upon him and his brother after the demise ofhis father in the year 1991 through testamentary succession; (iii) that hewent to Australia in March-1996 and returned to India on 4.02.2004;and (iv) that he required the tenanted premises for establishing adepartmental store, the respondent filed a petition for eviction underSection 13-B of the Act. The petition was allowed by the Rent Controllerby an Order dated 19.01.2010.

5. Challenging the order of the eviction passed by the learnedRent Controller, the appellant filed a revision before the High Court ofPunjab and Haryana at Chandigarh. The revision having been dismissedby the High Court, the tenant is on appeal before us.

6. The main contention of Shri Nidhesh Gupta, learned seniorcounsel for the appellant is that the issue raised by the appellant is nolonger res integra, but covered by the judgment of the Constitution Benchof this Court in Nathi Devi vs. Radha Devi Gupta[1]. However, theHigh Court, in the impugned order, chose to follow the decision of theDivision Bench of the High Court in Smt. Bachan Kaur vs. KabalSingh[2], which distinguished the Constitution Bench Judgment in NathiDevi (supra). Therefore, it is contended by Shri Nidhesh Gupta, learnedsenior counsel that the impugned order of the High Court requires to beinterfered with, by this Court, in the light of the law declared by theConstitution Bench while interpreting an identical provision in the DelhiRent Control Act, 1958 (for short “Delhi Act”).

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2 2011(1) RCR (Rent) 368

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A7. Since Nathi Devi (supra) was concerned with the interpretationof Section 14-B of the Delhi Rent Control Act, 1958 and since we areconcerned in this case with the interpretation of Section 13-B of theEast Punjab Urban Rent Restriction Act, 1949, we think it would beappropriate to extract the relevant provisions of both the enactments ina tabular column for better appreciation.B

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A8. In Nathi Devi, eviction was sought under Section 14-D of theDelhi Act by a widow landlady. The Rent Controller allowed the evictionsummarily and High Court confirmed the same. In the special leavepetition filed by the tenant, the decision of this Court in S. Surjit SinghKalra vs Union of India & Anr.[3] was relied upon in support of thecontention that a landlady who acquired the tenanted premises by wayBof transfer, could not avail the remedy under Section 14-D for the evictionof a pre-existing tenant. However, the Bench of two Hon’ble Judges ofthis Court before whom Nathi Devi (supra) first came up, doubted thecorrectness of the decision in S.Surjit Singh Kalra (supra) and, hence,directed the special leave petition to be placed before a three MemberCBench. The three Member Bench noticed the conflict between the S.Surjit Singh Kalra and Kanta Goel vs. B.P. Pathak[4]. The conflictwas with respect to the interpretation of the words “let out” appearingin the relevant provision. Due to this conflict, Nathi Devi was referredto the Constitution Bench by an order reported in Nathi Devi vs. RadhaDevi Gupta[5]. The short order of reference reads as follows:D“Specifically the issue is in relation to the meaning of thewords” let out”. Do they mean the creation of a fresh tenancyor do they refer to an existing tenancy? If the former, thesection can be resorted to only by the creator of the tenancy(widow or her late husband). If it is the latter, even a transfereeE(widow) is entitled to invoke it. We find that there is someconflict in the views taken by two Benches of three learnedJudges each. An observation in the judgment in Surjit SinghKalra v. Union of India suggests that the words “let out”refer only to the creation of a tenancy. On the other hand, theFjudgment in Kanta Goel v. B. P. Pathak interprets the words“let out” in the context of Section 14-D of the Act to meanthat even a transferee landlord can invoke the provision. Itis, in these circumstances, necessary that this appeal shouldbe heard by a Bench of five learned Judges. It shall be soplaced after obtaining the directions of the Hon’ble the ChiefGJustice of India in this regard.”

9. The Constitution Bench, after referring to the provisions ofSections 14B to 14D as well as Section 14(6) of the Delhi Act held (i)

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PADAM NABH & SONS v. YASH PAL

[V. RAMASUBRAMANIAN, J.]

that these provisions carve out an exception to the normal procedure foreviction; (ii) that being in the nature of exception, they must be construedstrictly and (iii) that the words “let out by him” or “let out by her”clearly signify that the premises let out by any other person will standexcluded from the operation of the summary procedure. Paragraphs 28and 32 of the Constitution Bench Judgment in Nathi Devi (supra) areextracted as follows, as the entire argument of the petitioners, revolvesaround the same:

“28. The observations in the aforesaid judgments no doubtsupport the case of the appellant. This Court did clearly laydown that the expression, “the premises let out by him” inSection 14-B of the Act did mean that it is he who has let outalone could evict, and in case the landlord had been killed inaction his dependent could seek immediate eviction of thepremises let out by such person. It is noticeable that theexpression, “premises let out by him” is used inSections 14-Band14-C, but the expression, in Section 14-D is “premises letout by her, or by her husband.”Section 14-B contemplatestwo situations, firstly, where the landlord is a released or retiredperson from any armed forces and secondly, where he waskilled in action. In case the landlord was killed in action aright has been given to his dependant within one year of thedeath of the landlord, to apply to the Controller for recoveringthe immediate possession of the premises. Section 14C confersa right on a retired employee of the Central Government orof the Delhi Administration who requires the premises let outby him for his own residence. Section 14-D confers a righton a widow of the landlord to seek immediate possession ofthe premises let out “by her, or by her husband”. The schemeof these Sections appears to be that where the landlord isalive and the premises have been let out by him, only he canmake an application for immediate possession of the premisesfor his own use. Only in the case of his death his dependantunder Section 14-A, and his widow under Section 14-D canseek immediate possession of the premises. The use of theexpression, “let out by him” in Sections 14-B and 14-C andthe expression, “let out by her, or by her husband” in Section14-D have significance. If it was unnecessary in the schemeof these Sections as to who had actually let out the premises, A

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Athe legislature would not have used the term “let out by him”or “let out by her, or by her husband”. In interpreting aprovision one cannot assume that the words employed by thelegislature are redundant. Section 14-D gives a right to filean application under that provision only to a widow who hadlet out the premises or whose husband had let out the premises.BConsequently, if the premises had been let out by someoneelse, Section 14-D will not apply. As pointed out in Surjit SinghKalra (supra) the expression used in Section 14-B is “thepremises let out by him”, unlike the expression used in Section14 (1)(e) where the legislature employed the expression “theCpremises let out for residential purposes”. Thus in the case ofa landlord belonging to the general category it was immaterialwhether the premises was let out by him or by someone else,as long as he was the landlord of the premises at the time ofmaking an application seeking eviction of the tenant. But theexpression, “let out by her, or by her husband” conveys aDdifferent meaning altogether. The widow’s right to recoverimmediate possession of the premises arises only if the premiseswere let out by her or by her husband, and not by anyoneelse. It appears to us that the legislature has purposelyemployed a different expression in Section 14-D as alsoin Section 14-B and 14-C. We are here concerned with anEapplication filed under Section 14-D which specifies in clearterms that a widow can invoke the provisions only if she haslet out the premises, or if her husband had let out the premises.If, as observed in Kanta Goel (supra), the expression, “thepremises let out by him” has been used only to convey theFidea that the premises must be owned by him directly and thelease must be under him directly, and not that he had himselflet out the premises, the legislature would not have then usedthe expression “let out by her, or by her husband.” The veryfact that the Section specifies that the premises must be onewhich was let out by the widow or by her husband impliesGthat the provision would not apply to a premises let out byany other person. If the intention of the legislature was toconfer an unlimited right on a widow landlord, the use of thewords “the premises let out by her, or by her husband” wouldhave been unnecessary and the Section would have simplyread as follows:- A

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“Where the landlord is a widow and the premises arerequired by her for her own residence, she may apply tothe Controller for recovering the immediate possession ofsuch premises.”

By expressly providing that the premises must be one letout by her or by her husband, the legislature has clearlyexcluded from the purview of the said provision “premises letout by any other person” even if in course of time the widowmay have become its landlord. We are obliged to read theprovision as it is, and cannot give it a meaning by deleting anexpression expressly employed by the legislature. Theexpression, “let out by her, or by her husband” is not anexpression which permits of any ambiguity. We must, therefore,give it its normal meaning. So understood the conclusion isinescapable that the legislature intent was only to confer aspecial right on a limited class of widows viz. the widow wholet the premises or whose husband had let the premises beforehis death, and which premises the widow requires for her ownuse.

“32. There is another aspect of the matter. Section 14-D usesthe expression, “premises let out by her, or by her husband”which are required by the widow for her own residence. Shemay apply to the Rent Controller for recovering the immediatepossession of “such premises”. “Such premises” obviously isrelatable to the premises let out her or by her husband. Itcannot take within its ambit any other premises which mayhave been let out by any other person. We, therefore, findsubstance in the submission urged on behalf of the appellantthat Section 14-D benefits only a class of widows viz. a widowwho or whose husband had let out the premises. If the intentionwas to benefit all widows, the section would have providedthat a widow is entitled to obtain immediate possession of thepremises owned by her and the expressions, “let out by heror by her husband” and “such premises” in Section 14-D would be redundant. The High Court, therefore, fell in errorin thinking that only two conditions were required to befulfilled for the application of Section 14-D namely, thelandlady is a widow, and the premises are required by her forher residence. In addition to these two requirements, in our A

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Aview, Section 14-D insists that the premises must be one letout by her or by her husband. A widow or her late husbandwho acquired a tenanted premises by sale or transfer cannotinvoke the provisions of Section 14D to evict a preexistingtenant.”

B10. But it is difficult to accept the contention that Nathi Deviwhich interpreted Section 14-D of the Delhi Act, would apply with equalforce to the interpretation of Section 13-B of the East Punjab UrbanRent Restriction Act. There are several distinguishing features betweenthe Delhi Act and the Punjab Act. Even before we take note of thedistinguishing features, we must keep in mind the fact that the shortageCof housing and the exploitation of tenants by landlords in the urban areas,in the aftermath of the world wars, led to the enactment of rent controllegislations in the country. The problems created by the post warconditions differed from State to State and hence, the solution sought tobe offered in the form of legislation also differed from State to State. AsDa matter of fact the East Punjab Urban Rent Restriction Act, 1949 is anoffshoot of the Punjab Urban Rent Restriction Act, 1941 and the PunjabUrban Rent Restriction Act, 1947, both of which are pre-independentand pre-partition legislation. On the contrary, the Delhi Act of 1958 is anoffshoot of the Delhi and Ajmer Rent Control Act, 1952. The areas towhich these acts applied had their own peculiar geographical featuresEand socio-economic conditions. This is why the language employed inthese rent control legislations differ, though they may have a commontemplate.

11. Coming to the distinguishing features between the Delhi Actand the East Punjab Act, it may be seen immediately that the Delhi ActFcovers four categories of persons, namely,(i) a landlord in occupation ofa residential premises allotted to him by the Central Government or anylocal authority and who is required to vacate such residentialaccommodation; (ii) a landlord, released or retired from armed forcesor a dependent of a member of any armed forces who had been killed inGaction, including a member of the armed forces who is due to retirewithin one year; (iii) a landlord who is a retired employee of the CentralGovernment or of the Delhi Administration; and (iv) a widow. But underthe Punjab Act, the right to seek immediate possession is conferred infavour of only two categories of persons, namely, (i) a specified landlord,meaning thereby a person entitled to receive rent in respect of a buildingH

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on his own account and who is holding or has held an appointment in apublic service or post in a connection with the affairs of the union or ofa State; and (ii) an owner who is a non resident Indian and who returnsto India.

12. While Section 13-A of the East Punjab Act was inserted byamending Act 2 of 1985, Section 13-B was inserted by Punjab Act 9 of2001. Delhi Act does not contain any special provision for the benefit ofNRI landlords. It is common knowledge that the major chunk of theNRI diaspora is from three states, namely, Punjab, Andhra Pradesh andKerala. Therefore, the legislature thought fit to exempt buildings ownedby NRIs from the rigors of the Rent Restriction Act. Hence, the normalrule of interpretation of a legislation for the welfare of the tenants, willgive way while interpreting the provisions as applicable to the exemptedcategories.

13. It may be of interest to note that while carving out an exceptionin favour of four categories of persons, under Sections 14-A, 14-B, 14-C and 14-D, the Delhi Act used only the word “landlord”. But thePunjab Act uses the word “specified landlord” under Section 13-Aand the word “owner” in Section 13-B. It is needless to mention thatthere is a world of difference between the expression “landlord” andthe expression “owner”. While the owner of a premises may also bethe landlord of the premises, a landlord, within the meaning of theexpression under the Rent Control legislations, need not necessarily bethe owner of the said premises. Therefore, while interpreting Section13-B of the Punjab Act, the Court must keep in mind the distinctionbetween those two expressions.

14. The proviso to Sub-section (1) of Section 13-B which curtailsthe right of the owner to invoke this provision for a period of five yearsfrom the date of becoming the owner, makes it clear that the words “letout by him” require a different interpretation .

15. If the interpretation suggested by Mr. Nidhesh Gupta on thebasis of the decision in Nathi Devi (supra) is accepted, a NRI who isthe owner of the building will be required to satisfy two conditions,namely,(i) that the premises was let out by him; and (ii) that a period offive years from the date of becoming the owner has elapsed. The provisoto Sub-section (1) cannot be construed as imposing a condition additionalto the one prescribed in Sub-Section (1). The correct method ofinterpreting Sub-section (1) of Section 13-B and the proviso thereunder A

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Ais to hold that irrespective of the person by whom the tenant was inducted,a NRI owner will have to wait for a period of five years from the date ofbecoming the owner, to be entitled to invoke Section 13-B.

16. We must also keep in mind the distinction between (i) inceptionof tenancy or induction of a person as a tenant; and (ii) letting out aBpremises on lease. Section 13-B(1) does not use the expression “inductedby him or her”. If these words had been used, they would certainlyrefer to the inception of the tenancy. Section 13(B)(1) uses the expression“let out”.

17. Section 106(1) of the Transfer of Property Act, 1882 declaresCthat a leasing of immovable property for agricultural or manufacturingpurposes shall be deemed to be a lease from year to year (in the absenceof a contract or local law or usage to the contrary). It also says that alease of immovable property for any other purpose shall be deemed tobe a lease from month to month. Therefore, if a NRI becomes the ownerof the building to which the Act applies and the tenancy of a person inDoccupation is attorned in his favour, the premises would become apremises let out by him, as otherwise the jural relationship of landlordand tenant will not come into existence. Once a NRI acquires a premiseswhich is in the occupation of a tenant inducted by his predecessor intitle, he becomes the owner. The moment the tenancy is attorned in hisEfavour, then the jural relationship of tenant landlord is created and thepremises become one let out by him. It is perhaps with a view to highlightthis aspect that the legislature has carefully used the expression “owner”in Section 13-B, even while using the expression “landlord” in otherplaces.F18. Therefore, the decision of the Constitution Bench in NathiDevi (supra) as applicable to the relevant provisions of the Delhi RentAct cannot be pressed into service for interpreting Section 13-B of theEast Punjab Urban Rent Restriction Act. Hence, we find that the orderof the High Court impugned in the present appeal is perfectly valid anddoes not call for any interference. Therefore the appeal is dismissed.G

19. However the tenant is granted six months’ time to vacate thepremises, provided the usual undertaking is furnished within a period oftwo weeks. There will be no order as to costs.

H

Devika Gujral

Appeal dismissed.