# 13 (ADDL.) S.C.R. 801 ~=} THE STATE OF MAHARASHTRA & ANR v. M/S. SUPER MAX INTERNATIONAL PVT. LTD. & ORS

- **Citation:** [2009] 13 S.C.R. 801
- **Court:** Supreme Court of India
- **Decided:** 2009-08-27
- **Case number:** Civil Appeal No. 5835 of 2009
- **Bench:** B.N. Agrawal, G.S. Singhvi, Aftab Alam
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/13-addl-s-c-r-801-the-state-of-maharashtra-anr-v-m-s-super-max-international-25154
- **Pages:** 36

## Headnote

......_
Rent Control - Bombay Rents, Hotel and Lodging House
Rates Control Act, 1947 - ss.13(3)(a) and 13(1)(g) - Suit for
ejectment of appellant-tenant - Decreed - Revision petition c
- High Court passed interim order staying execution of
"decree subject, however, to the condition that appellant would
deposit monthly rent at a rate higher than the contractual rent
.....
from the date of decree - Condition on which stay granted -
Challenged - Held: In an appeal/revision preferred by tenant D
_.
.Ji(
against order/decree of eviction passed under the Rent Act,
it is open to appellate/revisional Court to stay execution of the
order/decree on terms, including a .direction to pay monthly
rent at a rate higher than contractual rent - However, in fixing
the amount subject to payment of which execution of order/ E
decree is stayed, Courts to exercise restraint and not fix any
excessive, fanciful or punitive amount - On facts, High Court
fixed the amount with reference to Stamp Duty Ready
- >--
Reckoner and hence, its reasonableness cannot be doubted
- However,· in case eviction decree set aside, status quo ante
F
would be restored and ·appellant would be entitled to get back
all amounts that he \:\'BS made to pay in excess of the
contractual rent - Interim order - Legality of.
Appellant was in occupation of a building floor on a
G
monthly rent of about Rs.5,000/-. The Trial Court and
·i
Appellate Court decreed suit for ejectment of appellant on
grounds of (i) default in payment of taxes and water
charges and (ii) reasonable and bona fide need of the
landlords (Respondents 1 to 3) for their own use and
801
H
802
SUPREME COURT REPORTS [2009] 13 (ADDL.) S.C.R.
A occupation, i.e under section 13(3)(a) and 13(1)g) of the
+--
Bombay Rents, Hotel and Lodging House Rates Control
Act, 1947. The appellant filed revision petition before High
Court challenging the order of ejectment. The High Court
stayed execution of decree subject, however, to the
B condition that appellant would deposit an amount of Rs.
5,40,000/- as monthly rent commencing from date of
decree passed by Trial Court. Aggrieved by the condition,
the appellant filed the present appeal.
c
The question which arose for consideration in the
present appeal is whether in an appeal or revision
preferred by a tenant against a order or decree of eviction
-passed under the Rent Act, it is open to the appellate or
the revisional Court to stay the execution of the order or
the decree on terms, including a direction to pay monthly
~
D rent at a rate higher than the contractual rent.
....
)(
' '\
Dismissing the appeal, the Court
""'"
HELD: 1.1. There is a need for a more balanced and
E objective approach to the relationship between the
. landlord and tenant. This is not to say that the Court
should lean in favour of the landlord but merely that there
is no longer any room for the assumption that all tenants,
as a class, are in dire circumstances and in desperate
~-
F need of the Court's protection under all circumstances.
[Para 43] [832-G-H; 833-A-B]
,
1.2. The interim order of the High Court asking the
appellant to deposit Rs.5,40,000/- from the date of the
decree as condition for stay of the execution of the decree
G of ejectment has to be seen as one single package. The
appellant may or may not accept the order as a whole.
)--.
But it is not open to it to accept the order in so far as it
stays the execution of the decree and to question the
condition attached to it. In an appeal or revision, stay of
H
STATE OF MAHARASHTRA & ANR. v. SUPER MAX 803
INTERNATIONAL PVT. LTD.
,..., )--
execution of the decree(s) passed by the court(s) below A
cannot be Clsked for as of right. While admitting the
appeal or revision, it is perfectly open to the ~ourt, to
decline to grant any stay or to grant stay subject to some
reasonable condition. In case stay is not granted or in
case the order of stay remains inoperative for failure to
B
satisfy the condition subject to which it is granted, the
~
tenant-in-rev

## Text

_Characters 0–39,940 of 70,531. This is a partial read: ask again with offset=39940 for what follows._

[2009) 13 (ADDL.) S.C.R. 801
~=}
THE STATE OF MAHARASHTRA & ANR.
A
v.
M/S. SUPER MAX INTERNATIONAL PVT. LTD. & ORS.
(Civil Appeal No. 5835 of 2009)
AUGUST 27, 2009
B
[B.N. AGRAWAL, G.S. SINGHVI AND AFTAB ALAM, JJ.]
......_
Rent Control - Bombay Rents, Hotel and Lodging House
Rates Control Act, 1947 - ss.13(3)(a) and 13(1)(g) - Suit for
ejectment of appellant-tenant - Decreed - Revision petition c
- High Court passed interim order staying execution of
"decree subject, however, to the condition that appellant would
deposit monthly rent at a rate higher than the contractual rent
.....
from the date of decree - Condition on which stay granted -
Challenged - Held: In an appeal/revision preferred by tenant D
_.
.Ji(
against order/decree of eviction passed under the Rent Act,
it is open to appellate/revisional Court to stay execution of the
order/decree on terms, including a .direction to pay monthly
rent at a rate higher than contractual rent - However, in fixing
the amount subject to payment of which execution of order/ E
decree is stayed, Courts to exercise restraint and not fix any
excessive, fanciful or punitive amount - On facts, High Court
fixed the amount with reference to Stamp Duty Ready
- >--
Reckoner and hence, its reasonableness cannot be doubted
- However,· in case eviction decree set aside, status quo ante
F
would be restored and ·appellant would be entitled to get back
all amounts that he \:\'BS made to pay in excess of the
contractual rent - Interim order - Legality of.
Appellant was in occupation of a building floor on a
G
monthly rent of about Rs.5,000/-. The Trial Court and
·i
Appellate Court decreed suit for ejectment of appellant on
grounds of (i) default in payment of taxes and water
charges and (ii) reasonable and bona fide need of the
landlords (Respondents 1 to 3) for their own use and
801
H
802
SUPREME COURT REPORTS [2009] 13 (ADDL.) S.C.R.
A occupation, i.e under section 13(3)(a) and 13(1)g) of the
+--
Bombay Rents, Hotel and Lodging House Rates Control
Act, 1947. The appellant filed revision petition before High
Court challenging the order of ejectment. The High Court
stayed execution of decree subject, however, to the
B condition that appellant would deposit an amount of Rs.
5,40,000/- as monthly rent commencing from date of
decree passed by Trial Court. Aggrieved by the condition,
the appellant filed the present appeal.
c
The question which arose for consideration in the
present appeal is whether in an appeal or revision
preferred by a tenant against a order or decree of eviction
-passed under the Rent Act, it is open to the appellate or
the revisional Court to stay the execution of the order or
the decree on terms, including a direction to pay monthly
~
D rent at a rate higher than the contractual rent.
....
)(
' '\
Dismissing the appeal, the Court
""'"
HELD: 1.1. There is a need for a more balanced and
E objective approach to the relationship between the
. landlord and tenant. This is not to say that the Court
should lean in favour of the landlord but merely that there
is no longer any room for the assumption that all tenants,
as a class, are in dire circumstances and in desperate
~-
F need of the Court's protection under all circumstances.
[Para 43] [832-G-H; 833-A-B]
,
1.2. The interim order of the High Court asking the
appellant to deposit Rs.5,40,000/- from the date of the
decree as condition for stay of the execution of the decree
G of ejectment has to be seen as one single package. The
appellant may or may not accept the order as a whole.
)--.
But it is not open to it to accept the order in so far as it
stays the execution of the decree and to question the
condition attached to it. In an appeal or revision, stay of
H
STATE OF MAHARASHTRA & ANR. v. SUPER MAX 803
INTERNATIONAL PVT. LTD.
,..., )--
execution of the decree(s) passed by the court(s) below A
cannot be Clsked for as of right. While admitting the
appeal or revision, it is perfectly open to the ~ourt, to
decline to grant any stay or to grant stay subject to some
reasonable condition. In case stay is not granted or in
case the order of stay remains inoperative for failure to
B
satisfy the condition subject to which it is granted, the
~
tenant-in-revision will not have the protection of any of
the provisions under the Rent Act and in all likelihood
would be evicted before the revision is finally decided. In
the event the revision is allowed later on, the tenant's c
remedy would be only by way of restitution. [Para 44]
(833-C-F]
-4
1.3. In an appeal or revision preferred by a tenant
against a order or decree of an eviction passed under the
D
~
_Jr
Rent Act, it is open to the appellate or the revisional Court
to stay the execution of the order or the decree on terms,
including a direction to pay monthly rent at a rate higher
than the contractual rent. In fixing the amount subject to
payment of which the execution of the order/ decree is
stayed, the Court would exercise restraint and would not
E
fix any excessive, fanciful or punitive amount. In the case
in hand, the High Court fixed the amount of Rs. 5,40,000/
- t-
- per month with reference to the Stamp Duty Ready
Reckoner and hence, its reasonableness cannot be
doubted. [Paras 46 and 47] (835-8-E]
F
1.4. As regards the other question as to what would
be the position if the tenant's appeal/revision is allowed
and the eviction decree is set aside, in that event,
naturally, the status quo ante would be restored and the
G
. ._..
tenant would be entitled to get back all the amounts that
he was made to pay in excess of the contractual rent.
That being the position, the amount fixed by the court
over and above the contractual monthly rent, ordinarily,
should not be directed to be paid to the landlord during
H
804 SUPREME COURT REPORTS [2009] 13 (ADDL.) S.C.R.
A the pendency of the appeal/revision. The deposited
amount, along with the accrued interest, should only be
paid afte~ the final disposal to either side depending upon
the result of the case. In case for some reason the Court
finds it just and expedient that the amount fixed by it
B should go to the landlord even while the matter is
pending, it must be careful to direct payment to the
landlord on terms so that in case the final decision goes
in favour of the tenant the payment should be made to
him without any undue delay or complications. [Para 48]
c (835-E-H; .. 836-A]
,
Damadilal & Ors. vs. Parashram & Ors., (1976) 4 SCC
855; Gian Devi Anand VS. Jeevan Kumar (1985) 2 sec 683;
Mani Subrat Jain vs. Raja Ram Vohra, (1980) 1 SCC 1; H.
Shiva Rao vs. Cecilia Pereira (1987) 1 SCC 258 and Di/ip
D vs. Mohd. Azizu/ Haq & Anr., (2000) 3 SCC 6.07,
distinguished.
Atma Ram Properties (P) Ltd. v. Fe<lera/ Motors (P) Ltd.,
(2005) 1 SCC 705 and Satyawati Sharma v. Union of India
E & Anr., (2008) 5 sec 287, relied on.
Niyas Ahmad Khan v. Mahmood Rahmat Ullah Khan,
(2008) 7 sec 539, held inapplicable.
Malpe Vishwanath Acharya & Ors. v. State of
F Maharashtra & Anr., (1998) 2 SCC 1; Ganpat Ladha vs.
Shashi Kant Vishnu Shinde, (1978) 2 SCC 573; Anand Nivas
(Private) Ltd. v. Anandji Kalyanji Pedhi (1964) 4 SCR 892;
Jagdish Chander Chatterjee v. Sri Kishan (1973) 1 SCR 850;
Parubai Manila/ Brahmin v. Baldevdas Zaverbhai Tapodhan
G (1964) 5 Guj LR 563; v. Dhanapal Chettiarv. Yesodai Ammal
(1980) 1 SCR 334 and Joginder Pal v. Naval Kishore Behal
,_.,
(2002) 5 sec 397, referred to.
Case Law Reference:
H
(2005) 1 sec 105
relied on
Para 5
STATE OF MAHARASHTRA & ANR. v. SUPER MAX 805
INTERNATIONAL PVT. LTD.
,#_ t
(2008) 1 sec 539
held inapplicable Para 5
A
(1998) 2 sec 1
referred to
Para 15
(1976) 4 sec 855
dis ting IJ ished
Para 17
(1978) 2 sec 573
referred to
Para 17
B
(1985) 2 sec 683
distinguished
Para 17
-~
(1980) 1 sec 1
distinguished
Para 17
(1987) 1 sec 258
distinguished
Para 17 c
(2000) 3 sec 607
distinguished
Para 17
(1964) 4 SCR 892
referred to
Para 19
(1973) 1 SCR 850
referred to
Para 19
-
~
(1964) 5 Guj LR 563
referred to
Para 23
D
(1980) 1 SCR 334
referred to
Para 25
. (2008) 5 sec 281
relied on
Para 39
(2002) 5 sec 397
referreJ to
Para 40
E
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
5835 of 2009.
- ·t
From the Judgment & Order dated 14.10.2008 of the High
Court of Judicature at Bombay in Civil Application No. 47 of F
2008 in Civil Revision Application No. 78 of 2007.
U.U. Lalit, Sanjay V. Kharde, Chinmoy Khaladkar, Asha
Gopalan Nair for the Appellants.
Mukul Rohtagi, S.K. Srivastav, Shekhar Gupta, Diksha Rai,
G
,.-i
Balraj Dewan for the Respondents.
The Judgment of the Court was delivered by
H
806
SUPREME COURT REPORTS [2009) 13 (ADDL.) S.C.R.
A
AFTAB ALAM, J. 1. Leave granted.
-f ...
2. The Government of Maharashtra, the appellant before
us, is in occupation of an area of 9000 sq. ft. (11,050 sq. ft. as
per the affidavit-in-reply filed by the appellant) comprising the
B sixth floor of a building on a monthly rental of Rs. 5236.58/-,
besides water charges at the rate of Rs. 515.35/- per month.
The suit premises, used for housing the office of the Registrar
Co-operative Societies is situate at Fort, opposite ·GPO, (near
~-
C.S.T. Railway Station) in the heart of the city of Mumbai. The
c appellant is in occupation of the suit premises since 1966. At
that time the building belonged to the Maharaja of Travancore.
Respondents 1 to 3 purchased it under a deed of assignment
dated May 5, 1982 and stepped into the shoes of the landlord.
3. The appellant suffered a decree of ejectment passed
D by the Court of Small Causes on June 30, 2003 in RAE & R
~
Suit No. 1233/3730 of 1986 on grounds of (i) default in payment
-
of taxes and water charges as stipulated under section 13(3)(a)
and (ii) reasonable and bona fide need of the landlords,
respondents 1 to 3 for their own use and occupation in terms
E of section 13(1)(g) of the Bombay Rents, Hotel and Lodging
House Rates Control Act, 194 7 ('the Bombay Rent Act' or 'the
Act' hereinafter). Its appeal (No. 752/2003) against the decree
was dismissed by the Division Bench of the Small Causes
Court by judgment and order dated April 28, 2005.
-+--
F
4. The appellant initially filed a writ petition [W.P. (C)
No.7361 of 2005] seeking to challenge the orders of ejectment.
The Bombay High Court declined to entertain it on the ground
that the appellant had a remedy available to it under the Act
G
itself. It, accordingly, disposed of the writ petition by order dated
March 15, 2007 leaving it open to the appellant to file a civil
revision application as provided under section 35F(2) of the Act.
)---~
The appellant then moved the High Court in Civil Revision
Application No.78 of 2007 challengiag the orders of its
ejectment. The High Court admitted the Civil Revision on
H December 10, 2007 and issued rule on interim relief regarding
STATE OF MAHARASHTRA & ANR. v. SUPER MAX 807
INTERNATIONAL PVT. LTD. [AFTAB ALAM, J.]
,.._ ,.
stay of execution of the decree. Later on, after hearing the
A
parties the Court stayed the execution of the decree by order
dated October 14, 2008 subject, however, to the condition that
the appellant would deposit a sum of Rs. 5,40,000/- every month
commencing from the date of the decree passed by the trial
court. The Court directed that the amount in arrears should be
B
deposited by January 10, 2009 and from that date the future
deposits for every month should be made by the tenth of the
- ~
next succeeding mqnth. The Court, however, did not allow the
landlords to take away the money but further directed that the
deposits would be ad-hoc and subject to further order in the c
revision or in any other appropriate~roceeding. It also directed
the office to invest the amount(s), in case deposited by the
appellant, in a nationalized bank, initially for a period of one year
and then for further periods of one year each. The appellant
finds the condition on which stay is granted highly onerous. But
D
..k
the respondents maintain that the Court has been very liberal
with the appellant and the amount of monthly deposit fixed by
the court is far less than the current market rent in that area.
5. Of late, orders are coming to this Court where, in cases
arising from ejectment proceedings, the High Courts, with a
E
view to strike a balance between the competing interests of the
landlord and the tenant, pass interim orders asking the tenant
to pay to the landlord or deposit in court, as monthly rent, certain
- t
sum fixed by it (that, according to the High Court, should be the
reasonable market rent for the tenanted premises), far in
F
excess of the existing monthly rent. In this case, while it was at
the threshold, it was stated before this Court that two of its
Division Bench decisions, one in Atma Ram Properties (P) Ltd.
vs. Federal Motors (P) Ltd, (2005) 1 SCC 705 and the other
in Niyas Ahmad Khan vs. Mahmood Rahmat Ullah Khan,
G
, -o{
(2008) 7 sec 539 had taken conflicting views on the
correctness of such orders passed by the High Court. The case
was, accordingly, directed to be placed before a three-Judge
Bench and that is how it came to be heard before us.
H
808
SUPREME COURT REPORTS [2009] 13 (ADDL.) S.C.R.
A
6. It may be stated at the outset that just a little scrutiny
-( _,..,
revealed that there was no conflict between Atma Ram
Properties and Niyas Ahmad Khan. In Atma Ram Properties
the tenant, having lost before the Rent Controller preferred an
appeal before the Rent Control Tribunal. The Tribunal stayed
B the tenant's eviction but subject to the condition that he would
deposit in Court Rs.15,000/- per month, in addition to the
contractual rent that might be paid directly to the landlord. The
deposits made in the Court were not permitted to be withdrawn
-1 -
by any of the parties until the appeal was finally decided. The
c tenant challenged the condition attached to the stay order
before the High Court in a f)etition filed under Article 227 of the
Constitution of India. The High Court allowed the writ petition
and set aside the condition imposed by the Tribunal. The effect
of the order of the High Court was that during the pendency of
D the appeal before the Tribunal the tenant would continue to
remain in occupation of the suit premises "on payment of an
,t. ·-
amount equivalent to the contractual rate of rent". Against the
High Court order the landlord came to this Court in appeal. This
Court allowed the appeal, set aside the High Court order and
E
restored the order passed by the Tribunal.
7. In Niyas Ahmed Khan, the position was quite different.
The landlord's application for eviction of the tenant on grounds
of personal necessity was turned down by the prescribed
authority. The order of the prescribed authority was confirmed
+-
F by the appellate authority. The landlord challenged the orders
passed by the two authorities under the Rent Control Act in a
writ petition filed before the Allahabad High Court and while
admitting the writ petition the Court gave an interim direction
to the tenant to pay rent at the rate of Rs. 12,050/- per month
G (in place of the contractual monthly rent of Rs. 150/-). The Court
further directed that if the rent fixed by it was not paid for two
·consecutive months the landlord could evict the tenant by
}--"
coercive means taking the aid of police. In appeal by the tenant,
this Court naturally frowned upon the interim order passed by
H the High Court and in paragraph 10 of the decision observed
STATE OF MAHARASHTRA & ANR. v. SUPER M~ 809
INTERNATIONAL PVT. LTD. [AFTAB ALAM, J.]
h'r
as follows:
A
"10. To sum up, in writ petitions by landlords against
rejection of eviction petitions, there is no scope for issue
of any interim directi'on to the tenant to pay higher rent. But
in writ petitions by tenants against grant of eviction, the
High Court may, as a condition of stay, direct the tenant
8
to pay higher rent during the pendency of the writ petition.
-~
This again is subject to two limitations. First, the condition
should be reasonable. Second, there should not be any bar
in the respective State rent control legislation in regard to c
such increases in rent. Be that as it may."
8. We, thus, find no inconsistency, much less any conflict
in the decisions of this Court in Atma Ram Properties and
- {
Niyas Ahmed Khan. The decision in Niyas Ahmad Khan has
no application to the facts of the present case and it seems to
D
---
be covered by the decision of the Atma Ram Properties.
9. However, Mr. U. U. Lalit, Senior Advocate appearing for
the appellant, submitted that the decision in Atma Ram
Properties would apply only to cases under the Delhi Rent
E
Control Act and shall have no application to tenancies governed
by the provisions of the Bombay Rent Act. Mr. Lalit submitted
that the Delhi Rent Control Act defined 'tenant' in a way as to
~ t
exclude a person against whom a decree of eviction was
passed. Section 2(1) of the Delhi Rent Control Act, 1958 defined
tenant as:
F
"2(1) "tenant" means ............ but does not include, -
.
-
(A)
any person against whom an order or decree for
eviction has been made, except where such G
decree or order for eviction is liable to be reopened
~ -1
under the proviso to section 3 of the Delhi Rent
Control (Amendment) Act, 1976 (18 of 1976)."
10. Mr. Lalit submitted that under the Delhi Rent Control
Act a tenant suffering a decree or order of eviction lost the
H
810
SUPREME COURT REPORTS [2009] 13 (ADDL.) S.C.R.
A status of 'tenant' and was consequently stripped of all the
-f _
..
protection (including, against increase in rent) provided by the
Rent Control Act and in such a case it would be open to the
appellate or the revisional authority to enhance the monthly rent
payable by him as a condition for granting stay of execution of
B the decree or order as held in Atma Ram Properties. This
exclusionary clause in the definition of tenant was a special
feature of the Delhi Rent Act and the Rent Acts of some other
States, e.g. Madhya Pradesh, Rajasthan, etc. But the position
-1 -
under the Bombay Rent Act was materially different. In the
c definition of "tenant" in the Bombay Act there was no
exclusionary clause. Moreover, in the Bombay Rent Act there
were a number of provisions creating an express bar against
any enhancement of rent.
11. Learned counsel then took us through various
' -
D provisions of the Bombay Rent Act. He referred to section 5(11)
defining "tenant" and emphasised that this definition did not
~
have any exclusionary clause as in section 2(1) of the Delhi Act.
Section 5(11) of the Bombay Rent Act reads as follows:
E
"5(11 ). "tenant" means any person by whom or on whose
account rent is payable for any premises and includes,-
(a) such sub-tenants and other persons as have derived
title under a tenant before the 1st day of February 1973;
i--- '
F
(aa) any person to whom interest in premises, has been
assigned or transferred as permitted or deemed to be
pe_rmitted, under section 15;
(b)
any person remaining after the determination of
G
the lease, in possession, with or without the assent
of the landlord, of the premis-es leased to such
person or his predecessor who has derived title
)-- '
before the first day of February 1973;
H
(bb) such licensees as share deemed to be tenants for
the purposes of this Act by Section 1 SA
STATE OF MAHARASHTRA & ANR. v. SUPER MAX 811
INTERNATIONAL PVT. LTD. [AFTAB ALAM, J.]
(bba) the State Government, or as the case may be, the
A
..... tGovernment allottee, referred to in sub-clause (b)
of clause (1A), deemed to be a tenant, for the
purposes of this Act by Section 158;
(c)
(i) in relation to any premises let for residence, when
B
the tenant dies, whether the death has occurred
before or after the commencement of the Bombay
Rents, Hotel and Lodging House Rates Control
- t-
(Amendment) Act, 1978, any member of the
tenant's family residing with the tenant at the time c
of his death or, in the absence of such member, any
heir of the deceased tenant, as may be decided in
default of agreement by the Court;
(ii) in relation to any permission let for the purposes
"
of education, business, trade or storage, when the
D
>
).
tenant dies, whether the death as occurred before
or after the commencement of the said Act, any
member of the tenant's family using the premises
for the purposes of education of carrying on
business, trade or storage in the premises, with the
E
tenant at the time of his death, or, in the absence
of such member, any heir of the deceased tenant,
as may be decided in default of agreement by the
court.
- t
Explanation- The provisions of this clause for transmission
F
of tenancy, shall not be restricted to the death of the
original tenant, but shall apply, and shall be deemed always
to have applied, even on the death of any subsequent
tenant, who becomes tenant under these provisions on the
G
death of the last preceding tenant."
~-1
(emphasis added)
12. He then referred to the definitiqn of "standard rent" as
contained in section 5(10) of the Act. The provision is as under:
H
812
SUPREME COURT REPORTS [2009) 13 (ADDL.) S.C.R.
A
"5(10). "standard rent" in relation to any premises means,-.
(a) where the standard rent is fixed by the Court and the
Controller respectiveb; under the Bombay Rent Restriction
Act, 1939, or the Bombay Rents, Hotel Rates and Lodging
B
House Rates (Control) Act, 1944, such standard rent; or
_/'
(b) w~en the standard rent is not so fixed,-
subject to the provisions of section 11,
c
(i) the rent at which the premises were let on the first day
of September 1940, or
(ii) where they were not let on the first day of September
1940, the rent at which they were last let before that day,
or
D
(iii) where they were first let after the first day of September
1940, the rent at which they were first let, or
(iii-a) notwithstanding anything contained in paragraph (iii),
E
the rent of the premises referred to in sub-section (1-A) of
section 4 shall, on expiry of the period of five years
mentioned in that sub-section, not exceed the amount
equivalent to the amount of net return of fifteen percent, on
the investment in the land and building and all the
F
outgoings in respect of such premises; or
(iv) on any of the cases specified in section 11, the rent
fixed by the Court."
13. Mr. Lalit submitted that by virtue of section 5(10)(b) the
standard rent under the Bombay Rent Act was attached to the
G premises. It was, therefore, constant and not subject to any
H
· revision on change in tenancy. In other words even if the
appellant ceased to be a tenant and is thrown out, the
respondents can inpuct another tenant only on the same
"standard rent", that is, Rs.5236.58/- besides water charges at
-~.
-1 ....
(
~
I
i -
-,-
;;(
~-
·t- '-
I
STATE OF MAHARASHTRA & ANR. v. SUPER MAX 813
INTERNATIONAL PVT. LTD. [AFTAB ALAM, J.)
,...._ ?'"-
the rate of Rs.515.35/- per month. He further submitted that
A
,,
except in circumstances as provided under sections 10
(increase in rent on account of payment of rates, etc); 10A
(increase in rent in respect of premises that were let out on or
before September 1, 1940), 1 OB (saving increase in rent under
the previous provisions from the bar of section 7), and 11
B
(increase in rent resulting from 'standard rent' fixed by the court
in certain cases) any increment of rent was expressly barred
- ~
under section 7 of the Act.
14. Mr. Lalit submitted that in view of section 5(11) of the c
Act the appellant continued to be a tenant within the meaning
of the Act notwithstanding the decrees of ejectment passed by
the Small Causes Court. It, therefore, followed that the appellant
enjoyed all the protections provided under the Act and in light
.._,
of the provisions referred to above any direction to pay, as
D
• > •
monthly rent, any amount in excess of the standard rent was
contrary to law and unsustainable.
15. Before proceeding to examine Mr. Lalit's submissions
we may observe that earlier a three-Judge Bench of this Court
'
in Malpe Vishwanath Acharya & Ors. vs. State of Maharashtra
E
& Anr., (1998) 2 SCC 1, found and held that the provisions of
the Bombay Rent Act relating to the determination and fixation
of 'standard rent' can no longer be considered to be
.; -t
reasonable. The only reason why, despite the finding, the Court
did not strike down those provisions was that the Bombay Rent
F
,
Act was to come to an end on March 31, 1998 and the Court
was informed that the State was in the process of enacting a
new Rent Control Act that would be just and fair and would follow
the National Model Law that was circulated by the Central
Government in 1992. After the decision of the Court in Malpe G
Vishwanath ~charya the Bombay Rent Act was indeed
. -i
replaced by the Maharashtra Rent Control Act, 1999 that came
into force with effect from March 31, 2000. But Mr. Rohatgi,
learned Senior counsel appearing for the respondents, strongly
contended that the Maharashtra Rent Control Act completely
H
814
$UPREME COURT REPORTS [2009] 13 (ADDL.) S.C.R.
A
belied the hopes expressed by the Court under which it had
i.,.,.
refrained from striking down the offending provisions in the
Bombay Rent Act. Mr. Rohatgi submitted that the Maharashtra
Rent Control Act merely·brought about some cosmetic changes
but retained the substance of the earlier Bombay Rent Act.
B Referring to the definition of "standard rent" in section 7(14) of
the Maharashtra Rent Control Act, Mr. Rohatgi submitted that
it merely shifted the date from September 1, 1940 to October
1, 1987 for pegging the standard rent which continued to be
-i ~
attached to the premises and was not amenable to any revision
c on change of tenancy.
.16. The issue of reasonableness of the provisions of the
Maharashtra Rent Control Act, 1999 or the Bombay Rent Act
do not arise in this case and, therefore, we refrain from making
any observations in that regard but we do feel that the
....
D reasonableness or otherwise of the provisions of the
Maharashtra Rent Control Act may have to be seriously
.it
~
examined by this Court in an appropriate case.
17. Coming back to the case in hand, Mr. Lalit argued that
E in spite of the decrees of eviction passed by competent courts,
the appellant continued to be a "tenant" within the meaning of
the Bombay Rent Act until, in execution of the decree it was
physically evicted from the suit premises. The tenancy did not
come to end on the passing of the decree but would continue
+ ....
F as long as the appellant was in actual physical possession of
the suit premises; a priori it enjoyed all the protection under the
Bombay Rent Act and specially those laying down the bar
against any increase in rent. In support of the contention he
relied upon two sets of decisions, one on the issue of heritability
G of tenancy under the Rent Acts and the other on the question
whether a tenant could be evicted on the basis of a decree
made under the general law in case after the decree was
)-- .
passed the rented premises came to be covered by the Rent
Act. The first set comprises three decisions of this Court in (i)
H Damadilal & Ors. vs. Parashram & Ors., (1976) 4 SCC 855,
STATE OF MAHARASHTRA & ANR. v. SUPER MAX 815
INTERNATIONAL PVT. LTD. [AFTAB ALAM, J.]
k
).-
(ii) Ganpat Ladha vs. Shashi Kant Vishnu Shinde, (1978) 2
A
-
SCC 573 and (iii) Gian Devi Anand vs. Jeevan Kumar(1985)
·~
2 SCC 683. The second set also has three decisions. Those
are (i) Mani Subrat Jain vs. Raja Ram Vohra, (1980) 1 SCC
1, (ii) H. Shiva Rao vs. Cecilia Pereira (1987) 1 SCC·258 and
(iii) Di/ip vs. Mohd. Azizul Haq & Anr., ·(2000) 3 SCC 607.
B
18. Dealing with the three decisions in the first set, Mr. Lalit
"'- ~
submitted that Damadilal fully supported his contention. The
decision in Ganpat Ladha took a contrary view but later in Gian
Devi Anand a Constitution Bench overruled Ganpat Ladha and c
approved Damadilal thus, reinforcing the submission made on
behalf of the appellant.
19. The case of Damadilal arose under the Madhya
.....
Pradesh Accommodation Control Act, 1961. The suit premise
was a house in a bazar that was let out to the two defendants
D
>
)..-
(the tenants) for business purposes. The question that arose
in the case was whether on the death of the two tenants during
-
the pendency of their second appeal before the High Court, their
respective heirs and legal representatives had the right to get
themselves substituted in place of the original appellantsE
tenants and pursue the reliefs sought for by them. The High
Court permitted substitution and eventually allowed the second
appeal, setting aside the eviction decrees passed by the courts
,, -+
below. The High Court judgment was challenged before this
Court in appeal. One of the grounds on which the High Court
F
judgment was assailed by the appellants-landlords was that after
their contractual tenancy was determined the two original
tenants were reduced to the status of statutory tenants having
no heritable interest in the demised premises and on their
death the right to prosecute their appeal did not survive for their
G
heirs and legal representatives. In support of the contention
·~
reliance was placed on two earlier decisions of the Court in
Anand Nivas (Private) Ltd. vs. Anandji Kalyanji Pedhi (1964)
4 SCR 892 (arising under Bombay Rents, Hotel and Lodging
House Rates Control Act, 1947) and Jagdish Chander
H
816
SUPREME COURT REPORTS [2009] 13 (ADDL.) S.C.R.
A Chatterjee vs. Sri Kishan (1973} 1 SCR 850 [arising under the
~ ...
Rajasthan Premises (Control of Rent and Eviction) Act, 1950].
...
A three-Judge Bench, of this Court rejected the contention
I'
Jf'•
raised on behalf of the appellants. The decision in Damadilal
~
pointed out that the term 'statutory tenancy' was borrowed from
L
B the English Rent Acts and along with the expression certain
legal notions, peculiar to the English Common Law, had also
found their way in some Indian decisions though those concepts
had no basis in the Rent Acts of this country. The Court
1-~
observed that the courts in England had held that a statutory
c tenant had no estate or property in the occupied premises since
he retained possession by virtue of the Rent Act(s) and not as
being entitled to tenancy. It was said that he had only a personal
right to remain in occupation, the statutory right of "irremovability
and nothing more". The position in this country, however, was
D quite different. In paragraph 11 of the decision it was observed
'-I
as follows:
~
~
"We find it difficult to appreciate how in this country we can
proceed on the basis that a tenant whose contractual
..
tenancy has determined but who is protected against
E
eviction by the statute, has no right of property but only a
personal right to remain in occupation, without ascertaining
what his rights are under the statute. The concept of a
statutory tenant having no estate or property in the
....
premises which he occupies is derived from the provisions
~ ....
F
of the English Rent Acts. But it is not clear how it can be
assumed that the position is the same in this country
'
without any reference to the provisions of the relevant
statute. Tenancy has its origin in contract. There is no
dispute that a contractual tenant has an estate or property
in the subject- matter of the tenancy, and heritability is an
~
G
'
incident of the tenancy. It cannot be assumed, however,
that with the determination of the tenancy the estate must
~-·
necessarily disappear and the statute can only preserve
his status of irremovability and not the estate he had in the
H
premises in his occupation. It is not possible to claim that
STATE OF MAHARASHTRA & ANR. v. SUPER MAX 817
INTERNATIONAL PVT. LTD. [AFTAB ALAM, J.]
.,.__ ~
the 'sanctity' of contract cannot be touched by legislation.
A
It is therefore necessary to examine the provisions of the
Madhya Pradesh Accommodation Control Act, 1961 to
find out whether the respondents' predecessors-in-interest
retained a heritable interest in the disputed premises even
after the termination of their tenancy"
B
20. The decision then went on to examine section 2(i) of
..
~
the Madhya Pradesh Accommodation Control Act that defined
'tenant' and section 14 that provided for restrictions on
subletting and held that those provisions supported the view c
taken by the Court that the statutory tenant retained as much
interest in the demised premises as a contractual tenant.
21. The case of Ganpat Ladha arose under the Bombay
.._,
Rents, Hotel and Lodging House Rates Control Act, 1947 and
the premises from which the tenant was sought to be evicted
D
')
).>-
was a shop let out to him for business purpose. The trial court
and the appellate court decreed the suit on the findings that the
tenant had failed to make payment of the arrears of rent even
after a valid notice of demand was given to him by the landlord
and further that he was not entitled to the protection of section
E
12(3)(b) of the Act. The tenant challenged the decrees passed
by the courts below before the High Court in an application
under Article 227 of the Constitution. During the pendency of
_...,
the writ petition before the High Court the tenant died and her
son was impleaded in her place to pursue the reliefs prayed
F
for in the writ petition. The High Court eventually allowed the
writ petition on the ground that despite the default in payment
of arrears of rent, the trial court could exercise its discretion in
favour of the tenant and decline to pass a decree of eviction.
The matter finally came to this Court in appeal preferred by
G
landlord. A three-Judge Bench of the Court allowed the appeal
,. __..
inter alia holding that after the death of the original tenant her
son could not claim to be a tenant within the meaning of the
Act. The decision in Ganpat Ladha is based entirely on
interpretation of the definition of 'tenant' under the Bombay Rent
H
818
SUPREME COURT REPORTS [2009] 13 (ADDL.) S.C.R.
A Act. The Court noticed section 5(11) defining tenant and
~ -"'
reproduced the section insofar as it was relevant to the case
as follows:
"5. (11) 'tenant' means any person by whom or on whose
B
account rent is payable for any premises and includes-
(a) .....
(b) .....
-+ .
c
(c) any member of the tenant's family residing with him at
the time of his death as may be decided in default of
agreement by the Court"
22. The Court held that section 5(11)(c) restricted the
heritability of tenancy only to a member of the tenant's family
.,.._
D who might be residing with him at the time of his death. This in
turn implied that heritability of tenancy was confined only to
~
residential premises and the benefit could not be extended to
business premises. The Court held as follows:
E
"This principle underlying the enactment of Section
5(11)(c) also goes to indicate that it is in respect
of residential premises that the protection of that
section is intended to be given. We can appreciate
a provision being made in respect of business
.,...._
F
premises that on the death of a tenant in respect
of such premises, any member of the tenant's
'
family carrying on business with the tenant in such
premises at the time of his death shall be a tenant
and the protection of the Rent Act shall be available
G
to him. But we fail to see,what purpose the
legislature could have had in view in according
protection in respect of business premises to a
)- -,
member of the tenant's family residing with him at
the time of his death. The basic postulate of
H
protection under the Rent Act is that the person who
is sought to be protected must be in possession of
STATE OF MAHARASHTRA & ANR. v. SUPER MAX 819
INTERNATIONAL PVT. LTD. [AFTAB ALAM, J.]
...._·~
th~ premises and his possession is protected by
A
the legislation. But in case of business premises,
a member of the family of tenants residing with him
at the time of his death may not be in possession
of the business premises"
23. In Ganpat Ladha this Court approved the decision of
B
the Gujarat High Court in Parubai Manila/ Brahmin vs.
..
~
Baldevdas Zaverbhai Tapodhan (1964) 5 Guj LR 563 and in
support of the view taken by it also cited the amendment
introduced by the Gujarat Legislature in section 5(11 )(c) of the c
Bombay Rent Act. It needs to be stated here that in Ganpat
Ladha the earlier decision in Damadi/al was not brought to the
notice of the Court and the Court did not go into the question
whether a tenant on his death left behind any heritable estate
""'
or interest in the tenanted premises.
D
/
).:-
24. Gian Devi is a decision by a Constitution Bench of five
Judges. The case arose under the Delhi Rent Control Act, 1958
•
and the tenanted premises was once again a shop. The
question that the Court framed for its consideration was as
under:
E
"To state it more precisely, the question is whether the
heirs of a deceased tenant whose contractual tenancy in
_.....,..
respect of commercial premises has been determined,
are entitled to the same protection against eviction
F
afforded by the Act of the tenant"
25. In this case, the Constitution Bench considered both
the earlier decisions in Damadilal and in Ganpat Ladha. It also
considered the earlier seven-Judge Bench decision in V.
Dhanapal Chettiar vs. Yesodai Ammal (1980) 1 SCR 334
G
~--1
besides several other decision of the Court. In Gian Devi, as
in Damadila/, the Court observed that the expression statutory
tenant was used in English Rent Acts and the concept that a
statutory tenant had no estate or interest in the demised
premises was peculiar to the English Law. It had no basis in
H
820 SUPREME COURT REPORTS [2009) 13 (ADDL.) S.C.R.
A the provisions of the Rent Acts of the different States of this
-f -"
country. Referring to the earlier decision in Damadilal in
paragraph 25 of the judgment the Court observed as follows:
"This Court has very aptly observed in Damadilal case that
B
it cannot be assumed that with the determination of the
tenancy, the estate must necessarily disappear and the
statute can only preserve the status of irremovability and
not the estate he has in the premises in his occupation"
-1 ,.
In the same paragraph, the decision reproduced Section 2(1)
c of the Delhi Rent Control Act that defined tenant both as it
stood prior to and after its amendment by Act 18 of 1976 and
observed as follows:
"It is, therefore, clear from the definition of tenant, whether
D
in the original Act or in the amended Act, that the tenant
~·
within the meaning of the definition of the term in the Act
_,..
includes any person continuing in possession after the
termination of his tenancy. It will be seen that the definition
of tenant in Madhya . Pradesh Accommodation Control
.. ~
E
Act, 1961 on which the decision in Damadilal case
mainly turns, is similar to the definition of tenant as given
in the Delhi Act in the sense that the tenant under both
the Acts includes for the purpose of Rent Act any person
continuing in possession after the tennination of tenancy."
..,.....~
.. F
(emphasis. added)
. In this regard in paragraph 31 of the decision, it observed
as follows:
G
"The very premise, on the basis of which the argument is
advanced, is, in our opinion, unsound. The termination of th
contractual tenancy in view of the definition of t
nant in the Act does not bring about any change in the st
~-
tus and legal position of the tenant, unless there a
e contrary provisions in the Act; and, the tenant
H
notwithstanding the termination of tenancy does enjoy an
STATE OF MAHARASHTRA & ANR. v. SUPER MAX 821
INTERNATIONAL PVT. LTD. [AFTAB ALAM, J.)
,._ ~-
estate or interest in the tenanted premises. This interest
A
or estate which the tenant under the Act despite
termination of the contractual tenancy continues to enjoy
creates a heritable interest in the absence of any provision
to the contrary. We have earlier noticed the decision of this
Court in Damadilal case. This view has been taken by this
B
Court in Damadila/ case and in our opinion this decision
represents the correct position in law. The observations of
.
~
this Court in the decision of the seven-Judge Bench in the
case of V. Dhanapal Chettiar vs.