Dr. H.K. Sharma vs. Shri Ram Lal

IN THE SUPREME COURT OF INDIA
Civil Appellate Jurisdiction
CIVIL APPEAL Nos. 1237­1238 of 2019
(Arising out of S.L.P.(C) Nos.28420­28421 of 2017)
Petitioner
Dr. H.K. Sharma 
Respondent
Shri Ram Lal
Date of Judgement
28 January, 2019
Bench
Hon’ble justice Abhay Manohar Sapre

Facts of the case:

The respondent being the applicant is the owner of the house bearing No.5A, Court Road, Nardev Shastri Road, Dehradun comprising of four rooms, one kitchen, two verandahs and two galleries. On 22.07.1985 through a tenancy agreement of monthly rent Rs. 750, respondents lent out a portion of this house consisting of three rooms, one kitchen, latrine­ bathroom, one store and two verandas to the appellant. Thereafter on 28.04.2008, an application under Section 21(1) (a) of the U.P. Urban Buildings (Regulation of Letting Rent and Eviction) Act, 1972 had been filed by the respondent against the appellant to seek eviction of the house for his bona fide need. 

Issues raised:

• Whether the application filed by the respondent under section 21(1)(a) of the UP Urban Buildings (Regulation of Letting Rent and Eviction) Act, 1972 was justiciable to be allowed by the High Court?

Arguments advanced

Contention raised by the Respondent:

• It was alleged by the respondent that he needs the house for his bona fide need of residence. He contended that he got retired from his services and has no other house of his own where he can live and require eviction of the house for his personal residence and also for his family members. 

Contention raised by the Appellant:

• The appellant (opposite party) in his written statement contented that respondent has no bona need of the said house. He further submitted that on 13.05.1993 he entered into an agreement with the respondent for purchasing the house and for that purpose he paid a large amount to the respondent. It is contented that relationship of tenant and landlord does not exist between the parties as the house had been sold to the appellant and now it subsists the relationship of buyer and seller.
• Moreover, the appellant says that he is no longer in possession of the house as tenant but he is in possession as a purchaser in part performance of the agreement. Therefore, it is further submitted that application filed under section 21(1) (a) of UP Act by the respondent against the appellant does not stand.
• The application filed by the respondent on 03.11.2010 was dismissed by the Prescribed Authority by an order while upholding that as the parties had entered into a sale as a result, payment of monthly rent was not needed since the relation of landlord and tenant had ceased to exist.
• Later the appeal was filed by the respondent in the appellate court. On 19.12.2015, the appellate court dismissed the appeal while affirming the Prescribed Authority’s order. Besides, a Writ Petition under article 227 of Constitution of India was filed before the Nainital High Court. Later, the petition was allowed by the High Court and order to setting aside the appellate court’s decision had been given. The recall application was also dismissed by the High Court.
• “The High Court held that mere agreement to sell the suit house would not result in termination of landlord tenant relationship between the parties unless there is a stipulation in the agreement itself to that effect. It was also held that since the agreement in question relied on by the appellant (opposite party) is not a registered agreement, he is not entitled to raise the plea of part performance based on Section 53­A of the Transfer of Property Act, 1882 (for short “the TP Act”) against the respondent. The High Court further held that the respondent being an old man has every right to live in his house in the last leg of his life and more so when he has no other house of his own in the city and, therefore, he has made out a case of bona fide need for his residence as also for the members of his family.”
• Its order resulted in the filing of appeal by special leave in the Apex Court. Was it justified on the part of the High Court to allow the application filed by the respondent under Section 21(1) (a) of the UP Act?
• The learned counsel for appellant, Mr. Jitendra Sharma while referring the decision in Kanthimathi & Anr. v. Beatrice Xavier (Mrs.) [(2000) 9 SCC 339] contended that High Court erred in allowing the application. Further, he submitted that the tenancy agreement terminates the moment the landlord and tenant enter into an agreement of sale/purchase and tenant pays the part performance for the tenanted property. Hence, the relationship of landlord and tenant ceased to exist. He further said that Prescribed Authority and the Appellate Authority were rightly dismissed but wrongly affirmed by the High Court.
• The impugned order of the High court was supported by the counsel of respondent (Mr. Narender Hooda). 

Findings of the court:

The question which arose before the Court is that whether the agreement for sale and purchase between the lessor and lessee for the tenanted property during the subsistence of lease would result in determination of lease. The Court in this respect interpreted section 111 of TP Act and said that “it is the intention of the parties to the lease. Whether the parties intended to surrender the lease on execution of such agreement in relation to the tenanted premises or they intended to keep the lease subsisting notwithstanding the execution of such agreement.” Clauses (a) to (h) set out the grounds on which a lease of an immoveable property can be determined. Clauses (e) and (f) with which we are concerned here provide that a lease can be determined by an express surrender.

Also, section 105-117 of TP Act governed with the rights of a lease of an Immovable property. It is further observed that though the parties are entering into an agreement of sale/purchase but they do not have an intention to surrender the property. If they have an intention then they must made a specific clause in that respect and  the conditions set out in the agreement do not make out a case of express surrender under clause (e) or implied surrender under clause (f) of Section 111 of the TP Act. 

Decision held by the court:

The Apex Court while dismissing the appeal held the decision concluded by affirming the High Court’s decision which was that a mere agreement pertaining to sale shall not terminate the relation of a landlord-­tenant unless and otherwise there is a stipulation in that agreement to that regard. It was further held that as the agreement relied upon by the appellant (opposite party) was not registered, the party shall not be entitled for raising a plea of part performance under the Transfer of Property Act, 1882 against the tenant (respondent). The Apex Court further went on upholding the decision of the High Court with regard to the respondent who being an old man who has a bona fide intention to possess the right of living in his own house. Hence, there is no perversity in the finding of the High Court. At last appellant has been given three months’ time from the date of the order to vacate the house and also one-month time to pay the arrears of rent to the respondent. 

Provisions involved:

Section 111 of the Transfer of Property Act, 1882.

Section 53­A of the Transfer of Property Act, 1882.

Section 105–117 of the Transfer of Property Act, 1882.

Section 21 of the Transfer of Property Act, 1882.

Article 226 of Constitution of India.

Edited by Sree Ramya

Approved & Published – Sakshi Raje 

Reference

1.  Kanthimathi & Anr. v. Beatrice Xavier (Mrs.) [(2000) 9 SCC 339]