Om Prakash Gupta vs Rattan Singh And Another

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: Supreme Court of India

Case Number: Civil Appeal No. 541 of 1962

Decision Date: 17 December, 1962

Coram: Sinha, C. J.

In the matter of Om Prakash Gupta versus Rattan Singh and another, the Supreme Court of India delivered its judgment on 17 December 1962. The petitioner was Om Prakash Gupta and the respondents were Rattan Singh and another. The dispute concerned the Delhi Rent Control Act (Law LIX of 1958), specifically section 15, and involved questions of rent‑control benefits, the denial of a landlord‑tenant relationship, and the jurisdiction of the Rent Controller.

The landlord had instituted eviction proceedings against the petitioner on two grounds: first, that the petitioner habitually failed to pay rent, and second, that the landlord required the premises for his own occupation. The petitioner contested the suit, asserting that the premises had been let to the All India Postal R.M.S. Union for combined office and residential use, that the Union’s tenancy had not been terminated, and that no rent had been demanded from the Union. The court ordered the petitioner to pay all overdue rent and to continue depositing future rent on a month‑by‑month basis.

Subsequently, the respondent filed an application under section 15(7) of the Act seeking to strike out the petitioner’s defence on the basis that the petitioner had failed to obey the rent‑deposit orders. The Additional Rent Controller dismissed the petitioner’s explanation, ordered the defence to be struck out on 26 July 1961, and subsequently passed an ex‑parte eviction decree. The petitioner appealed this order; the Rent Control Tribunal rejected the appeal on 6 March 1961, stating that the appeal was barred by limitation and also lacking merit. The petitioner did not pursue the matter further before the High Court.

When the petitioner challenged the eviction decree before the Rent Control Tribunal, that tribunal dismissed the appeal, and the petitioner’s subsequent appeal to the High Court was also dismissed summarily. On special leave, the petitioner argued that by denying any landlord‑tenant relationship, the Rent Controller lacked jurisdiction. The Court held that, under rent‑control law, the special tribunal must proceed on the basis that a landlord‑tenant relationship exists between the parties; a mere denial by the tenant does not deprive the tribunal of jurisdiction. Jurisdiction can be lost only when the tribunal itself concludes that such a relationship does not exist. Furthermore, the Court observed that section 15, together with the definition of “landlord,” empowers the Rent Controller to determine the existence of a landlord‑tenant relationship for the tenant’s benefit, and when a party invites the Rent Controller to apply section 15 for his benefit and the Controller does so, the Controller is deemed to have decided that relationship.

The Court observed that a person who is a tenant cannot simply deny the tenancy and must instead raise the denial as a defence and withdraw from the proceedings. It was further held that because the appellant did not seek to strike out his defence under section fifteen, sub‑section seven, on appeal to the High Court, the issue of his tenancy became conclusively determined. Consequently, the question of whether the appellant was a tenant could not be reopened in the present proceedings. The appeal, designated as Civil Appeal No 541 of 1962, was filed by special leave against a May 31, 1962 order of the Punjab High Court, Circuit Bench, Delhi. The order being appealed from had dismissed the appellant’s challenge to a Rent Control Tribunal decision dated March 7, 1962, which affirmed an eviction order issued on July 27, 1961 by the Additional Rent Controller, Delhi. The respondents were acknowledged as the landlords of the property located at number 24, Ansari Road, Darya Ganj, Delhi. The appellant asserted that he had occupied the premises since before 1950, paying a monthly rent of fifty rupees. In 1955 the respondents initiated a suit seeking eviction of the All India Postal & R.M.S. Union, and the appellant was joined as a party to that suit. In 1958 the respondents applied to amend the plaint, claiming that the father of the first respondent had let the building to the appellant for residential use, and that the suit should therefore proceed only against him. They further argued that, because of this tenancy, the suit should proceed only against the appellant. The subordinate judge hearing the suit refused to permit the amendment and instead allowed the respondents to withdraw from that suit, granting them liberty to file a fresh action, by order dated May 8, 1959. Subsequently, on February 25, 1960, the respondents filed an application before the Rent Controller, Delhi, seeking eviction of the appellant alone, without joining the Union as a party.

The appellant contended that the premises had originally been let by the father of the first plaintiff‑respondent to the All India Postal & R.M.S. Union for combined office and residential purposes in the original arrangement. He further asserted that the Union’s tenancy had never been terminated, and therefore the appellant’s occupancy derived from a licence rather than a tenancy, as per his claim. On this basis, the appellant claimed that he was not a tenant and that, consequently, the eviction petition filed against him was untenable and should be dismissed. The eviction petition was premised upon the allegation that the appellant, as a tenant, had persistently defaulted in rent payment and that the respondents required the premises for bona‑fide residential use. The appellant denied the allegation of default and maintained that the Union remained the lawful tenant throughout the tenancy. He further argued that any notice demanding rent should have been served upon the Union, not upon him. He further described his status as that of a licensee of the Union, emphasizing that he occupied the premises only with the Union’s permission. The petition for eviction was founded on the allegation, the particulars of which were to be examined during the trial.

In this case, the petition for eviction alleged two main grounds. First, it claimed that the appellant, who was asserted to be a tenant, had repeatedly failed to pay rent. Second, it contended that the premises were truly needed by the respondents for their own residence because the first respondent was about to leave the service of a hospital that had previously provided him with housing. Accordingly, the petition was filed under sections 14(1)(a) and 14(1)(e) of the Delhi Rent Control Act, 1958, which the judgment will refer to simply as the Act. The appellant denied that he was a tenant and maintained that the Union mentioned earlier held the tenancy. He further argued that the respondents had already secured suitable accommodation and therefore did not have a bona‑fide need for the premises. He said that the notice demanding rent that had been served on him was legally invalid because he was not the tenant; such a notice, he insisted, should have been served on the Union. The appellant described his occupancy as a licence granted by the Union and asserted that no landlord‑tenant relationship existed between him and the respondents. On 2 April 1960, the Additional Rent Controller issued an order requiring the appellant to pay all rent arrears dating from 1 August 1958, calculated at a rate of fifty rupees per month, and to deposit the rent for each subsequent month by the 15th day of that month. The respondents, relying on that order, filed an application on 16 May 1961 under section 15(7) of the Act seeking to have the appellant’s defence against eviction struck out on the ground that he had failed to make the required payment or deposit as directed. The appellant responded by denying any deliberate default in rent payment. He acknowledged that any shortfall, if it existed, was the result of a miscalculation and not an intentional refusal to pay. Nevertheless, on 26 July 1961 the Additional Rent Controller ordered that the appellant’s defence be struck out. The appellant appealed that order to the Rent Control Tribunal on 15 September 1961, but the appeal was filed one day after the prescribed period. The Tribunal therefore dismissed the appeal on the basis of jurisdictional delay and also on its merits by an order dated 6 March 1962. Separately, on 17 July 1961 the Additional Rent Controller passed an ex‑parte order of ejectment against the appellant. In that order he found, on the face of the evidence, that a landlord‑tenant relationship existed, relying on rent receipts that the respondents had previously given to the appellant. He also concluded that the respondents’ personal need for accommodation was genuine. The Rent Control Tribunal upheld that ejectment order and dismissed the appellant’s challenge on 7 March 1962. Subsequently, on 28 May 1962 the appellant filed a second appeal in the High Court of Punjab at Delhi, challenging the Tribunal’s 7 March 1962 order that had dismissed his appeal against the ejectment. No

In this case, the appellant filed a second appeal to the High Court contesting the dismissal by the Rent Control Tribunal of his earlier appeal against the Additional Rent Controller’s order that struck out his defence. The High Court dismissed this second appeal summarily on May 31, 1962, through a single judge. During the long vacation, the appellant approached this Court and, on June 5, 1962, obtained an order from the vacation judge granting special leave to appeal. The landlord‑respondent raised a preliminary objection, asserting that because no second appeal had been filed against the Tribunal’s March 6, 1962 order dismissing the appellant’s challenge to the Additional Rent Controller’s decision, that order had become final and the present appeal was therefore incompetent. The Court observed that this issue was intertwined with the merits of the appeal and consequently should be considered as a substantive contention between the parties rather than a preliminary objection. The appellant contended that the authorities under the Act lacked jurisdiction to entertain the proceedings because the existence of a landlord‑tenant relationship between the parties had been denied. Accordingly, the appellant argued that section 15 (7) of the Act could not be invoked against him in the absence of a finding that he was the tenant of the premises in question. The appellant further maintained that the one‑day delay in filing the appeal to the Rent Control Tribunal should have been condoned and that the order refusing condonation was vitiated by erroneous considerations. Additional arguments concerning concurrent factual findings of the Rent Controller and the Rent Control Tribunal were noted, but the Court indicated that those points need not be addressed. The central question for determination was whether the Rent Control authorities possessed jurisdiction over the matter. Normally, civil courts decide whether a legal relationship exists between litigants. However, the Act was enacted to regulate rents and evictions for the benefit and protection of tenants, presupposing a pre‑existing landlord‑tenant relationship and governing certain terms of that relationship. Consequently, the Act contains no explicit provision empowering the controller or the Tribunal to determine the existence of such a relationship. In most cases, that question does not arise before the authorities under the Act, and a landlord would be ill‑advised to commence proceedings under the Act if no landlord‑tenant relationship existed.

In this case, the Court noted that if the person in possession is not a tenant, the owner may sue for ejectment in civil court without restriction of the Act. Only in the situation where the occupant holds the premises as a tenant in an urban area do the provisions of the Act become applicable. When a controller is approached for eviction on the ground that the occupant is a tenant who has committed an act or omission making him liable for eviction, and the tenant denies that the plaintiff is landlord, the controller must decide whether a landlord‑tenant relationship exists. If the controller finds no such relationship, the proceeding must end without addressing the substantive question of eviction. Conversely, if the controller determines that the plaintiff is landlord and the occupant is tenant, the eviction proceedings must continue. Under section 15(4) of the Act, the controller is empowered to decide whether the claimant is entitled to an order for payment of rent. Where there is a dispute as to the person to whom rent is payable, the controller may direct the tenant to deposit the amount with him until the question of entitlement is resolved. The Act defines “landlord” as a person who receives or is entitled to receive the rent of the premises. If the controller concludes that a dispute raised by the tenant about rent entitlement is false or frivolous, he may order the defence against eviction to be struck out under section 15(5). Likewise, if a tenant fails to make the payment or deposit required by section 15(2), the controller may strike out the defence and proceed with the eviction hearing under section 15(7). In the present matter, the Rent Controller exercised such powers and issued an order in accordance with section 15. Proceedings that are initiated under the provisions of section 15 are intended primarily to protect and benefit the tenant in his possession of the premises. The section authorises the controller, after hearing both parties, to order the tenant to pay the amount calculated as due to the landlord or to deposit that amount with the controller within one month of the order. Such an order can be issued only when the controller has determined that the person against whom eviction is sought occupies the premises as a tenant. Accordingly, any order issued by the controller under section 15 or any other provision of the Act rests on the assumption that the controller possessed jurisdiction to determine the existence of a landlord‑tenant relationship. In this case, when the controller ordered the deposit of arrears of rent under section 15(1) and, upon default, struck out the defence under sub‑section (7) of section 15, the controller effectively decided that the appellant was a tenant. This decision, however, does not become res judicata in a regular suit where the same issue may arise for determination. Thus, every order made by a controller under the Act proceeds on the premise that the controller has the requisite power to decide the relationship, and an order under section 15(1) is primarily aimed at protecting and benefitting the tenant.

In this case, the Court observed that when the Controller issues an order under section 15 or any other provision of the Act, the order presumes that the Controller possesses jurisdiction to determine the landlord‑tenant relationship. The present case involved the Controller directing the appellant to deposit the arrears of rent under paragraph (1) of section 15, and subsequently, after the appellant failed to comply, invoking sub‑paragraph (7) of section 15 to strike out the defence. By taking those steps, the Controller was deemed to have concluded that the appellant was a tenant. The Court noted that such a conclusion does not acquire the character of res judicata in an ordinary suit where the same issue might later arise for determination. Accordingly, every order made by a Controller under the Act proceeds on the assumption that the authority has the power conferred by the statute, power that is intended to control rents and evictions of tenants. The Court further explained that an order under section 15(1) is primarily intended for the protection and benefit of the tenant. If the appellant truly claimed that he was not a tenant, the proper course would have been to deny the existence of a landlord‑tenant relationship and withdraw from the proceedings. Instead, the appellant actively sought the protection afforded by the Act, obtaining an order that gave him additional time to make the required deposit. By obtaining that order, the appellant invited the Controller to determine that a landlord‑tenant relationship existed and that the tenant was entitled to the statutory safeguards. While the Act does not expressly empower its authorities to make a final determination of the landlord‑tenant relationship, it operates on the premise that such a relationship exists. When a party challenges that premise, the statutory tribunals must still consider the question, because a simple denial does not divest them of jurisdiction. The tribunals created by the statute have a limited jurisdiction defined by the provisions of the Act, but within those limits they enjoy exclusive jurisdiction, and their orders are final and not subject to collateral attack in separate suits or execution proceedings. In the Court’s view, therefore, the appellant’s denial of the relationship does not extinguish the tribunal’s jurisdiction, nor does it invalidate the application of sub‑paragraph (7) of section 15. The orders issued under those provisions were for the appellant’s benefit, and by failing to utilise the relief granted, he cannot now complain about them.

In the appeal, the contention that the appellant’s denial of a landlord‑tenant relationship automatically removed the jurisdiction of the authorities created under the Act was rejected. The Court also found no basis for the contention that the provisions of sub‑section (7) of section 15 of the Act had been wrongly applied to the appellant. The orders issued under those provisions were expressly for the appellant’s benefit, and consequently the appellant was deemed to have invited the Controller to pass such orders in his favour. Had the appellant intended to withdraw from the proceedings, he could have done so by informing the Controller that he did not wish to contest the matter because he was not a tenant and that a third party was the tenant. The order in question bound only the appellant and no other person; because the appellant failed to invoke the order granted to him under section 15(7), he could not later complain about it. The question of whether a delay of one day ought to have been condoned was a matter of discretion vested in the appellate authority, and it was not for the Court to dictate how that discretion should have been exercised. What mattered was not the length of the delay but whether any justification for the delay existed. Determining the sufficiency of the appellant’s ground for condonation was within the appellate authority’s remit. The issue of condoning the delay was essentially academic, since the Tribunal had not only examined the delay but also decided the appeal on its merits, concluding that there was no ground to interfere with the orders passed by the Rent Controller. Consequently, the question of condonation had no practical significance in the present case. The greater issue was the merit of the decision that awarded possession to the landlord. It was observed that the appellant’s conduct was inconsistent: he had availed himself of all the benefits the Act confers on a tenant, and subsequently claimed that the Rent Controller lacked jurisdiction because he was not a tenant. The Rent Controller was required to resolve the dispute between the parties for the purpose of disposing of the case under the Act. If the appellant truly was a tenant, he had enjoyed the protective provisions of the Act, including a six‑month grace period after an order of eviction in favour of the landlord. If he was not a tenant, the order of the Rent Controller caused him no loss. The proceedings could not affect the interests of a person who was not a party to the case. Moreover, a second appeal lay from the appellate

In this case the Court noted that the Rent Control Tribunal had issued an order dismissing the appellant’s appeal against the earlier order which had struck out his defence. The Court further observed that the appellant had not taken any such second appeal to the High Court, although, as previously mentioned, a second appeal had been lodged against the Tribunal’s order that dismissed his appeal concerning the eviction order. The Court explained that the appellate order of the Rent Control Tribunal, dated 6 March 1962, which dismissed the appeal against the order striking out the appellant’s defence, had become final between the parties and could no longer be subject to any further challenge. Consequently, the Court held that the appellant could no longer contest the jurisdiction of the authorities under the Act. In the Court’s opinion, the appellant’s present appeal therefore lacked any merit. Accordingly, the Court dismissed the appeal, ordered that costs be awarded against the appellant, and entered a final order that the appeal was dismissed.