Holding

A tenant must be in actual physical possession of the building he constructed to invoke the protection of Section 9; sub‑clause (b) of Section 2(4)(ii) does not apply to the appellants who have sub‑let the premises.

Summary

The three oil companies (Bharat Petroleum, Indian Oil and Hindustan Petroleum) held long‑term leases on land, constructed petrol pumps and then sub‑let the premises to dealers. The landlords filed ejectment suits and the companies sought orders under Section 9 of the Madras City Tenants’ Protection Act, 1921 for the sale of the leasehold land at a court‑determined price. The Supreme Court examined the effect of the 1972 and 1973 amendment Acts, particularly sub‑clause (b) of Section 2(4)(ii), which applies only to tenants who were earlier excluded by the now‑deleted proviso to Section 12. It held that the oil companies, having handed over possession to third parties, are not in "actual physical possession" and therefore cannot claim the benefit of Section 9. Consequently, the Court upheld the High Court’s rejection of the applications and dismissed the appeals.

Issues considered

The scope and applicability of sub‑clause (b) of Section 2(4)(ii) of the Madras City Tenants’ Protection Act after the 1972 and 1973 amendments.
Whether a tenant who has sub‑let or licensed the premises is in "actual physical possession" for purposes of Section 9.
Whether the oil companies qualify as tenants under sub‑clauses (i) or (ii)(a) of Section 2(4) and are entitled to the protection of the Act.

Legislation cited

Subjects

tenancy lawleaseholdactual physical possessionsection 9Madras City Tenants’ Protection Actamendment legislationsub‑leaseevictionstatutory rights

Judgment

436 [2020]REPORTS
SUPREME COURT 3 S.C.R. 436 [2020] 3 S.C.R.

A BHARAT PETROLEUM CORPORATION LIMITED
v.
R. CHANDRAMOULEESWARAN AND OTHERS
(Civil Appeal No. 2870 of 2007)
B JANUARY 28, 2020
[N. V. RAMANA, SANJIV KHANNA AND
KRISHNA MURARI, JJ.]
Madras City Tenants’ Protection Act, 1921 – s.9 – The rights
of tenants in terms of – The appellants-Three oil companies had
C
under different written registered lease deeds with the landlords
taken land on long-term lease and had thereupon constructed petrol
pumps that were given to and operated by the dealers appointed by
the appellant under the dealership agreements – The respondents-
landlords filed suits for ejectment for recovery of possession of the
D land – Thereafter, the appellant had filed applications purportedly
u/s. 9 of the Act for transfer/sale of the leasehold land in whole or
in part at the price fixed by the Court – The applications were
rejected by the High Court – On appeal, held: The appellant-tenants
would not be entitled to the benefit and rights under the Act unless
they are in actual physical possession of the building constructed
E
by them – In other words, in case the appellants have let out or sub-
let the building or given it to third parties, including dealers or
licensees, they would not be entitled to protection and benefit under
the Act – The orders passed by the High Court upheld.
Madras City Tenants’ Protection Act, 1921 – Sub-clauses (i)
F
and (ii) (a) to Cl.4 of s.2 – Applicability of – Held: Sub-clauses (i)
and (ii)(a) to clause (4) of s. 2 of the Act apply to all tenants who
had entered into oral or unregistered written agreements or registered
written agreements without any stipulation with regard to ‘erection
of buildings’ for taking land on lease, and had subsequently
G constructed buildings – Such tenants would be entitled to protection
of the Act provided the tenant satisfies the conditions mentioned in
sub-clauses (i) or (ii)(a) to clause (4) of s.2 of the Act.
Madras City Tenants’ Protection Act, 1921 – Sub-clause (ii)(b)
to Cl.4 of s.2 – Applicability of – Paragraph 1 of sub-clause (ii)(b)
H
436
BHARAT PETROLEUM CORPORATION LIMITED v. 437
R. CHANDRAMOULEESWARAN AND OTHERS

to clause (4) of s.2 of the Act applies to tenants who are not entitled A
to the rights under the Act by reason of the proviso to s.12 which
stood deleted vide the Amendment Act, 1972 – Paragraph 2 of the
said sub-clause applies to cases where a decree of declaration or
decree or an order of possession or similar relief has been passed
against a tenant on the ground that the proviso to s.12, which was
B
omitted by the Amendment Act, 1972, disentitles the tenant from
claiming rights under the Act. Accordingly, sub-clause (b) to s.2(4)(ii)
would apply only to tenancies which were earlier excluded from the
protection under the Act vide the proviso to s.12 which stands deleted
with retrospective effect vide the Amending Act, 1972.
Dismissing the appeals, the Court C

HELD: 1. The amendments and modifications made by the
Amendment Acts of 1972 and 1973 whereby sub-clause (b) to
Section 2(4)(ii) of the Madras City Tenants’ Protection Act, 1921
was added with retrospective effect, the proviso to Section 12
was deleted with retrospective effect and the amendments to D
Section 9 were made with retrospective effect, have to be read
holistically and in entirety, for it is a well-known canon of
construction that every section of a statute is to be construed
with reference to the context and other sections of the statute,
so as, as far as possible, to make a consistent enactment of the E
whole statute. By these amendments, the tenants excluded from
the benefit/privilege of the Act vide the proviso to Section 12
were brought within the ambit of the protection and rights given
under the Act but with different conditions and stipulations. In
other words, sub-clause (ii)(b) to section 2(4) is restricted and
applies to only those tenants who were covered by the proviso to F
Section 12 and not those tenants who were already entitled to
protection and rights under the Act. This is clear from the latter
portion of sub-clause (ii)(b) to Section 2(4) of the Act which refers
to the proviso to Section 12 and also a decree for declaration or
possession or similar relief passed against the person on the G
ground that proviso to Section 12 had disentitled such persons
from claiming rights under the Act. The amendment made by
adding sub-clause (b) to Section 2(4)(ii) vide the Amendment Act,
1973 was not to dilute or impose new conditions on the tenants
who were otherwise entitled to protection as tenants under Section
H
438 SUPREME COURT REPORTS [2020] 3 S.C.R.

A 2(4)(i) or to Section 2(4)(ii)(a) of the Act read with Sections 3, 4
and 9 of the Act. This also flows from the legislature using the
word ‘continues in possession’ in sub-clause (ii)(a) to Section 2(4),
whereas the words used in sub-clause (ii)(b) are ‘continues in
actual physical possession’. The legislature deliberately has used
different words in sub-clauses (ii)(a) and (ii)(b). The enactment
B
of sub-clause (ii)(b) has to be read with other amendments made
vide the Amendment Acts of 1972 and 1973 and would accordingly
apply to those tenants who were brought under the umbrella and
protection of the Act by deleting the proviso to Section 12.
Therefore, sub-clause (ii)(b) to Section 2(4) would apply to tenants
C who were covered by the deleted proviso to Section 12, whereas
sub-clause (ii)(a) to Section 2(4) would apply to tenants who had
taken land on lease without any written registered instrument
relating to the ‘erection of buildings’. [Para 15][453-C-H; 454-
A-B]
D 2. This Court holds as under:
(i) Sub-clauses (i) and (ii)(a) to clause (4) of Section 2 of the
Act apply to all tenants who had entered into oral or unregistered
written agreements or registered written agreements without any
stipulation with regard to ‘erection of buildings’ for taking land
E on lease, and had subsequently constructed buildings. Such
tenants would be entitled to protection of the Act provided the
tenant satisfies the conditions mentioned in sub-clauses (i) or
(ii)(a) to clause (4) of Section 2 of the Act.
(ii) Paragraph 1 of sub-clause (ii)(b) to clause (4) of Section
F 2 of the Act applies to tenants who are not entitled to the rights
under the Act by reason of the proviso to Section 12 which stood
deleted vide the Amendment Act, 1972. Paragraph 2 of the said
sub-clause applies to cases where a decree of declaration or
decree or an order of possession or similar relief has been passed
against a tenant on the ground that the proviso to Section 12,
G which was omitted by the Amendment Act, 1972, disentitles the
tenant from claiming rights under the Act. Accordingly, sub-clause
(b) to Section 2(4)(ii) would apply only to tenancies which were
earlier excluded from the protection under the Act vide the
proviso to Section 12 which stands deleted with retrospective
H effect vide the Amending Act, 1972.
BHARAT PETROLEUM CORPORATION LIMITED v. 439
R. CHANDRAMOULEESWARAN AND OTHERS

(iii) Sub-clause (ii)(c) to clause (4) of Section 2 states that A
heirs of a tenant referred to in sub-clause (i) or sub-clauses (ii)(a)
or (ii)(b) would be entitled to benefit of the Act. However, it
expressly excludes a sub-tenant or heirs of the sub-tenant. [Para
21][457-D-H; 458-A-B]
3. Recording the aforesaid position, this Court dismisses B
the present appeals by the appellant, that is, the three petroleum
companies, and uphold the orders passed by the High Court that
the appellant tenants would not be entitled to the benefit and
rights under the Act unless they are in actual physical possession
of the building constructed by them. In other words, in case the
appellants have let out or sub-let the building or given it to third C
parties, including dealers or licensees, they would not be entitled
to protection and benefit under the Act. [Para 22][458-B-C]
Bharat Petroleum Corporation Ltd. v. Nirmala and
Another [C.A.No. 5903 of 2006 dated 03.12.2021];
P. Ananthakrishnan nair and Anr. v. Dr. G. D
Ramakrishnan and Anr. (1987) 2 SCC 429; S.R.
Radhakrishnan and Others v. Neelamegam (2003) 10
SCC 705 – relied on.
N. Vajrapani Naidu v. New Theatres Carnatic Talkies
Ltd., Coimbatore [1964] 6 SCR 1015; Haridas E
Girdhardas and Others v. Varadaraja Pillai and Anr.
(1971) 2 SCC 601; Swami Motor Transports (P) Ltd
and Another v. Sri Sankaraswamigal Mutt and Anr.
[1963] Supp 1 SCR 282; Dr. K.A. Dhairyawan and
Others v. J.R. Thakur and Others [1959] SCR 799; F
Raghbir Singh Gill v. Gurcharan Singh Tohra and
Others [1980] SCR 3 1302 – referred to.
Case Law Reference
[1964] 6 SCR 1015 referred to Para 10
G
(1971) 2 SCC 601 referred to Para 10
[1980] SCR 3 1302 referred to Para 15
[1963] Supp 1 SCR 282 referred to Para 17
[1959] SCR 799 referred to Para 17
H
440 SUPREME COURT REPORTS [2020] 3 S.C.R.

A (1987) 2 SCC 429 relied on Para 18
(2003) 10 SCC 705 relied on Para 18
[1987] 2 SCR 734 referred to Para 18
[2003] 1 Suppl. SCR 987 referred to Para 19
B CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2870
of 2007.
From the Judgment and Order dated 06.02.2007 of the High
Court at Madras in Second Appeal Nos. 904 and 929 of 1996.
With
C
Civil Appeal Nos. 761, 763, 765, 766, 767, 768, 769, 770-771, 772,
773, 774, 775-776 of 2020.
Sudhir Chandra, Kailash Vasdev, S. Guru Krishnakumar,
Ms. Meenakshi Arora, Shekhar Naphade, Ms. V. Mohana,
D R. Balasubramanian, Mohan Parasaran, Col. R.Balasubramanian, Sr.
Advs., Parijat Sinha, Anil Kumar Mishra, Ms. Reshmi Rea Sinha, Rudra
Dutta, Devesh Mishra, Ms. Akriti Jain, Ms. Pallak Bhagat, Ms. Mala
Narayan, Rahul Narayan, Shashwat Goel, Digvijay, S.C. Ghosh, Abhikalp
Pratap Singh, Ms. Aishwarya Dash, B. Ragunath, Mrs. N.C. Kavitha,
Ms. Nikitha Cooper, Ms. Anikitha Sharma, Vijay Kumar, M.A.
E Chinnasamy, C. Rubavathi, B. Karunakaran, V. Senthil Kumar, P. Raja
Ram, T. Meikandan, V. Balaji, Asaithambi MSM, Vinod Mehta, Pravesh
Thakur, Ms. Sripradha K., Rakesh K. Sharma, Narendra Kumar, T. R.
B. Sivakumar, M. Yogesh Kanna, S. Ramesh, R. Venkataraman, Thanga
Thurai, Kumar Dushyant Singh, K. Ethiraj, N. L. Ganapathi, Shiv Prakash
F Pandey, Chandra Shekher Yadav, Desh Ratan Nigam, Pankaj Kumar,
Awanish Sinha, Vikas Mehta, K. K. Mohan, Mrs. Prabha Swami,
Mrs. Divya Swami, Nikhil Swami, Amitabh Sinha, Chandra Bhushan
Prasad, T.K. Nayak, E. C. Agrawala, Rishi Agrawala, Ms. Madhavi
Agarwal, Rajesh Kumar, Ms. Abha Saigal, Ms. Prashi Tyagi, M. A.
Krishna Moorthy, Ms. Neela Gokhale, Ms. Kamakshi S. Mehlwal,
G K. Rajendran, Roshan Chapagain, Pukhrambam Ramesh Kumar, Advs.
for the appearing parties.

H
BHARAT PETROLEUM CORPORATION LIMITED v. 441
R. CHANDRAMOULEESWARAN AND OTHERS

The Judgment of the Court was delivered by A
SANJIV KHANNA, J.
1. Leave granted in the special leave petitions.
2. The above-captioned appeals filed by the three oil companies,
namely, Bharat Petroleum Corporation Limited, Indian Oil Corporation B
Limited and Hindustan Petroleum Corporation Limited (hereinafter
referred to as ‘the appellant’), raise an identical question of law relating
to the right of a tenant, in terms of Section 9 of the Madras City Tenants’
Protection Act, 1921 (hereinafter referred to as the ‘Act’), to an order
whereby the landlords could be directed to sell the leasehold land in
whole or in part at the price fixed by the court. C

3. Briefly, the appellant had under different written registered lease
deeds with the landlords taken land on long-term lease and had thereupon
constructed petrol pumps that were given to and operated by the dealers
appointed by the appellant under the dealership agreements. In some
cases the leases were renewed on nationalisation of companies in terms D
of Burmah Shell (Acquisition of Undertakings in India) Act, 1976, Caltex
(Acquisition of Shares of Caltex Oil Refining (India) Limited and of the
Undertakings in India of Caltex (India) Limited) Act, 1977, and Esso
(Acquisition of Undertakings in India) Act, 1974. However, it is an
accepted position that the term or duration of the leases, even where E
leases were renewed, has expired in all cases.
4. The landlords, who are the contesting respondents before us,
had or have filed suits for ejectment for recovery of possession of the
land. The appellant had filed applications purportedly in exercise of their
right under Section 9 of the Act for transfer/sale of the leasehold land in F
whole or in part at the price fixed by the court. By different impugned
judgments, some of which have arisen from the remand order dated 3rd
December 2009 passed by the Division Bench of this Court, the Madras
High Court has rejected the applications filed by the appellant, either
affirming or reversing the findings of the trial court or the lower appellate
court. G
5. Preamble of the Act as originally enacted in 1921 had stated:
“An Act to give protection to certain classes of tenants in the City
of Madras.
H
442 SUPREME COURT REPORTS [2020] 3 S.C.R.

A WHEREAS it is necessary to give protection to tenants who in
many parts of the City of Madras have constructed buildings on
others’ lands in the hope that they would not be evicted so long as
they pay a fair rent for the land and
WHEREAS the sanction of the Governor-General has been
B obtained under section 80-A (3) of the Government of India Act”
The Objects and Reasons of the Act read as under:
“In many parts of the City of Madras, dwelling houses and other
buildings have, from time to time, been erected by tenants on
lands belonging to others, in the full expectation that subject to
C payment of a fair ground rent, they would be left in undisturbed
possession, notwithstanding the absence of any specific contract
as to the duration of the lease or the terms on which the buildings
were to be leased. Recently, attempts made on steps taken to
evict a large number of such tenants have shown that such
D expectations are likely to be defeated. The tenants, if they are
evicted, can at the best remove the superstructure, which can
only be done by pulling down the buildings. As a result of such
wholesale destruction, congested parts of the City will become
more congested to the serious detriment of public health. In these
circumstances, it is just and reasonable that the landlords when
E they evict the tenants should pay for and take the buildings. There
may, however, be cases where the landlord is unwilling to eject a
tenant if he can get a fair rent for the land. The Act provides for
the payment of compensation to the tenant in case of ejectment
for the value of any building which may have been erected by him
F or his predecessors-in-interest. It also provides for the settlement
of fair rent at the instance of the landlord or tenant. Provision is
also made to enable the tenant to purchase the land in his occupation
subject to certain conditions.”
The Act as enacted in 1921 was to give protection to a certain
G class of tenants in the city of Madras who had before the enactment of
the Act, and not after the enactment, constructed structures on the
leasehold lands in the city of Madras. The objects and reasons refer to a
peculiar situation prevailing in the city of Madras where dwelling houses
and other buildings had been erected by the tenants on land taken on
lease in expectation and belief that their possession would not be disturbed,
H
BHARAT PETROLEUM CORPORATION LIMITED v. 443
R. CHANDRAMOULEESWARAN AND OTHERS [SANJIV KHANNA, J.]

subject to payment of fair-ground rent to the landlords. The agreements A
with the landlords, reasons record, would be silent on duration of the
lease and the terms on which the buildings were to be leased. Reasons
further state that recently, that is before the enactment in 1921, attempts
and steps had been initiated by the landlords to evict large number of
such tenants, thereby the general expectations of the tenants were likely
B
to be defeated as they were liable to be evicted. Therefore, the Act was
enacted to prevent wholesale destruction of the buildings/superstructures
which were required to be pulled down by the tenants on eviction. This
would have caused serious detriment to public health as buildings were
to be demolished in the congested parts of the city. In these circumstances,
it was reasonable and proper that the tenants should be asked to pay fair C
market price of the land to the landlords and become owners of the land.
As some landlords would not be interested in ejectment of a tenant, the
Act provided for enhancement of rent in such cases so that the landlord
would get fair market rent. The Act dealt with payment of compensation
of the value of the building by the landlord in case the tenant did not
D
want to purchase or pay fair market value of the land.
6. The Act has undergone a paradigm shift in terms of its reach
and ambit by extending protection to leases and constructions made post-
1921 and extension to areas other than the ones recognised in the original
enactment as well as by enhancing and modifying the terms of protection
available to the tenants. These amendments particularly vide the Madras E
Act No. 19 of 1955, Tamil Nadu Act No. 13 of 1960, Tamil Nadu Act
No. 4 of 1972 and Tamil Nadu Act No. 24 of 1973 which have been
hereinafter referred to as the Amendment Act, 1955; Amendment Act,
1960; Amendment Act, 1972 and Amendment Act, 1973, respectively,
shall be expounded to the extent necessary for the present decision. To F
avoid prolixity, we have avoided quoting and referring to the history of
the legislation and the changes made thereto.
7. By the Amendment Act, 1955, the Act was extended to
‘municipal towns and adjoining areas in the State of Madras’1. By
the Tamil Nadu Adaptation of Laws Order, 1969 as amended by the G
Tamil Nadu Adaptation of Laws (Second Amendment) Order, 1969, the
expression ‘State of Tamil Nadu’ was substituted for the words ‘State

1
This was further amended by the Madras City Tenants’ Protection (Amendment) act,
1979 whereby the words “municipal towns” were substituted by the words “municipal
towns and townships”. H
444 SUPREME COURT REPORTS [2020] 3 S.C.R.

A of Madras’. The Amendment Act, 1972 had also amended the Preamble
by deleting the words ‘in the hope that they would not be evicted’.
The Preamble as it stands now reads as under:
“An Act to give protection to certain classes of tenants in municipal
towns and townships and adjoining areas in the State of Tamil
B Nadu.
WHEREAS, it is necessary to give protection against eviction to
tenants, who in municipal towns and townships and adjoining areas
in the State of Tamil Nadu have constructed buildings on others’
land so long as they pay a fair rent for the land;”
C With the amendments, the Act was extended to be applied even
to leases of land executed post the enactment and enforcement of the
Act in 1921. However, the Act even post the amendments applies only
to those leases of land on which building was constructed by the tenant
prior to the date specified and not post the date specified.
D 8. We would begin our interpretation by referring to in brief the
scheme of the Act which postulates and grants certain rights that may
be exercised by the tenant facing eviction proceedings. Under Section 3
of the Act, the tenant is entitled to be paid compensation equivalent to
the value of the building, which he or any of his predecessors in interest
E or any person not in occupation at the time of ejectment who derived
title from either of them, had erected and for which compensation has
not been already paid. The tenant is also entitled to the value of the trees
and any improvements which may have been planted/made by him.
Section 9 of the Act grants the tenant, who is entitled to compensation
under Section 3 and against whom a suit for ejectment has been instituted
F or proceeding under Section 41 of the Presidency Small Cause Courts
Act, 1882 (Central Act XV of 1882) taken by the landlord, to apply for
an order directing the landlord to sell for a price to be fixed by the court,
in whole or in part, the extent of land specified in the application. Under
clause (b) to Section 9(1), the court shall decide the minimum extent of
G the land which is necessary for the convenient enjoyment by the tenant
and accordingly fix the price for the land either as prayed by the applicant
or as determined by the court, whichever is less.
9. Section 12 protects the rights of a tenant against eviction,
notwithstanding the contract entered into by a tenant. However, prior to
its amendment vide the Amendment Act, 1972, the override and
H
BHARAT PETROLEUM CORPORATION LIMITED v. 445
R. CHANDRAMOULEESWARAN AND OTHERS [SANJIV KHANNA, J.]

paramountcy of the Act was not applicable to written registered leases A
of land that had stipulations as to the ‘erection of buildings’. Section 12
as originally enacted had stated:
“12. Effect of contracts made by tenants. – Nothing in any
contract made by a tenant shall take away or limit his rights under
this Act provided that nothing herein contained shall affect any B
stipulations made by the tenant in writing registered as to the
erection of buildings, in so far as they relate to buildings erected
after the date of the contract.”
Thus, the proviso to Section 12 had given primacy to the written
registered document with a covenant as to ‘erection of buildings’ after C
the date of the agreement. Parties are ad idem that the effect of the
proviso was to effectively deny the tenants the statutory right to purchase
land under Section 9 or enforce other rights under the Act where the
written registered agreement had a stipulation relating to ‘erection of
buildings’ by the tenant, in which event parties would be bound by the
terms of the agreement and the Transfer of Property Act, 1882, and the D
Act, that is the Madras City Tenants’ Protection Act, 1921, would not
apply. The proviso to Section 12 viz., the words ‘provided that nothing
herein contained shall affect any stipulations made by the tenant in
writing registered as to the erection of buildings insofar as they
relate to buildings erected after the date of the contract’ were deleted E
vide Section 3 of the Amendment Act, 1972 which reads:
“3. Amendment of Section 12, Tamil Nadu Act III of 1922.%
In section 12 of the principal Act, the portion commencing with
the words “provided that” and ending with the words “date of the
contract” shall be, and shall be deemed always to have been, F
omitted.”
Section 3 of the Amendment Act, 1972 postulates that the deleted
words shall be always deemed to have been omitted and did not form
part of the statute. A deeming provision with retrospective effect was
thus enacted. We are not dealing with the constitutional validity of the G
amendment made and, therefore, would not comment upon this aspect.
10. In N. Vajrapani Naidu v. New Theatres Carnatic Talkies
Ltd., Coimbatore,2 the Constitution Bench of five judges had upheld
validity of the Act, as it existed before the amendments vide the
2
(1964) 6 SCR 1015 H
446 SUPREME COURT REPORTS [2020] 3 S.C.R.

A Amendment Acts of 1972 and 1973, after referring to Section 12 which
had then vide the proviso excluded the written registered lease deeds
with the stipulation as to ‘erection of buildings’ from application of the
Act, to observe that the Act applies only to a limited class of land, that is,
land granted on lease for construction of buildings before the date with
effect from which the Act was extended to the town or village. The
B
purpose and objective behind the enactment was to give protection to
the tenants who had, notwithstanding the usual covenant relating to the
determination of tenancies, obtained land on lease in the hope that as
long as they pay and continue to pay fair rent, they would not be evicted.
However, the changed circumstances as a result of the war leading to
C appreciation in land values and increase in rents had put such tenants to
great inconvenience and harassment as they were faced with actions of
ejectment involving dismantling of properties constructed by them and
eviction. Upholding the Act, as it then existed, the Constitution Bench
observed that the protection and rights granted under the Act become
effective only when the landlord seeks to obtain, in breach of mutual
D
understanding, benefit of unearned increase in the land values by
instituting a suit for ejectment. The Act was manifestly in the interest of
general public to effectuate the mutual understanding between the
landlords and the tenants as to the duration of the tenancies, and to
conserve the existing buildings so constructed. Section 9 did not do much
E to deprive the landlord of his property or to acquire his rights as it was to
give effect to the real agreement between the landlord and the tenant
consequent to which the tenant was induced to construct a building on
the plot let out to him. The restriction would be in the interest of the
general public and, therefore, the Act did not offend the right to property
under Article 19(1)(f) of the Constitution of India. Referring to the
F
amendments vide the Amendment Act, 1960, it was observed that the
court can direct sale only of minimum area of land necessary for
convenient enjoyment by the tenant of the property/building built by him
and the price to be paid was the average market value of three years
immediately preceding the date of the order. In this decision, the majority
G had differed from the minority on the meaning of the expression ‘erection
of buildings’ in the context of written registered lease deed in question,
with the majority holding that the tenant was not covered by the proviso
as the clauses of the written registered lease deed did not relate to
‘erection of buildings’. The expression ‘erection of buildings’ in the proviso
to Section 12 was subsequently interpreted in Haridas Girdhardas
H
BHARAT PETROLEUM CORPORATION LIMITED v. 447
R. CHANDRAMOULEESWARAN AND OTHERS [SANJIV KHANNA, J.]

and Others v. Varadaraja Pillai and Another3. However, we need not A
go into the said aspect and interpretation of the expression ‘erection of
buildings’ because this question neither arises in the present appeals nor
is raised and argued before us.
11. We would now reproduce clause (4) to Section 2 of the Act
which defines the expression ‘tenant’ as amended from time to time. B
Originally Section 2(4) of the Act read as under:
“4. ‘tenant’ means tenant of land liable to pay rent on it, and
every other person deriving title from him, and includes persons
who continue in possession after the termination of the tenancy.”
By the Amendment Act, 1960 which came into force on 27th July C
1960, the definition of ‘tenant’ was substituted to read as under:
“4. ‘Tenant’ in relation to any land –
(i) means a person liable to pay rent in respect of such land, under
a tenancy agreement express or implied, and D
(ii) includes%
(a) any such person as is referred to in sub-clause (i) who
continues in possession of the land after the determination of the
tenancy agreement, and
(b) the heirs of any such person as is referred to in sub-clause (i) E
or sub-clause (ii)(a), but does not include a sub-tenant or his heirs.”
The Amendment Act, 1973, while retaining sub-clause (ii)(a) had
added a new sub-clause (b) in Section 2(4)(ii). The earlier sub-clause
(b) inserted vide the Amendment Act, 1960 was transposed as sub-
clause (c). Post the amendment vide the Amendment Act, 1973, clause F
(4) to Section 2 defining the term ‘tenant’ would read as under:
“(4) ‘Tenant’ in relation to any land –
(i) means a person liable to pay rent in respect of such land,
under a tenancy agreement express or implied, and G
(ii) includes –
(a) any such person as is referred to in sub-clause (i) who continues
in possession of the land after the determination of the tenancy
agreement,
3
(1971) 2 SCC 601 H
448 SUPREME COURT REPORTS [2020] 3 S.C.R.

A (b) any person who was a tenant in respect of such land under a
tenancy agreement to which this Act is applicable under sub-
section (3) of Section 1 and who or any of his predecessors in
interest had erected any building on such land and who continues
in actual physical possession of such land and building,
notwithstanding that—
B
(1) such person was not entitled to the rights under this Act by
reason of the proviso to Section 12 of this Act as it stood before
the date of the publication of the Madras City Tenants’ Protection
(Amendment) Act, 1972 (Tamil Nadu Act 4 of 1972), or
C (2) a decree for declaration or a decree or an order for possession
or for similar relief has been passed against such person on the
ground that the proviso to Section 12 of this Act as it stood before
the date of the publication of the Madras City Tenants’ Protection
(Amendment) Act, 1972 (Tamil Nadu Act 4 of 1972) disentitled
such person for claiming the rights under this Act, and
D
(c) the heirs of any such person as is referred to in sub-clause (i)
or sub-clause (ii)(a) or (ii)(b),
but does not include a sub-tenant or his heirs;”
Section 2 of the Amendment Act, 1973 which brought in the
E amendment in Section 2(4) gave retrospective effect to the amendments
from the date of enforcement of the Act, that is, 21st February 1922.
For clarity, we would like to reproduce Section 2 of the Amendment Act,
1973 which reads as under:
“2. Amendment of section 2, Tamil Nadu Act III of 1922.%
F For sub-clause (ii) of clause (4) of section 2 of the Madras City
Tenants’ Protection Act, 1921 (Tamil Nadu Act III of 1922)
(hereinafter referred to as the principal Act), the following sub-
clause shall be and shall be deemed always to have been
substituted […]”
G 12. A Division Bench of this Court vide order dated 3rd December
2009 in C.A. No. 5903 of 2006 titled Bharat Petroleum Corporation
Ltd. v. Nirmala and Another and other connected matters while
interpreting sub-clause (b) to Section 2(4)(ii) has held that the expression
‘actual physical possession of land and building’ would mean and require
the tenant to be in actual physical possession. The provisions would not
H
BHARAT PETROLEUM CORPORATION LIMITED v. 449
R. CHANDRAMOULEESWARAN AND OTHERS [SANJIV KHANNA, J.]

be applicable if the tenant is not in actual physical possession and has A
given the premises on lease or licence basis to a third party. The Court,
however, did not give any finding on the question whether such benefit is
available to the appellant under Section 2(4)(i) or Section 2(4)(ii)(a). We
are reproducing the relevant portion of the order which reads as under:
“7. As regards sub-clause (b) of Section 2(4), we do not agree B
with the contention of Mr. Nariman. On a plain reading of sub-
clause (b) we notice that it uses the words “actual physical
possession”. Had the word ’possession’ alone been used in clause
(b), as has been done in clause (a), the legal position may have
been different. However, the words ‘actual physical possession’
are strong and emphatic. That means that the factual state of C
affairs has to be seen, not the legal or deemed state of affairs.
There is no doubt that the appellant had handed over possession
to his licensee/agent who was in actual physical possession of the
suit premises. When a Statute uses strong and emphatic words,
we cannot twist or give a strained interpretation to the said words. D
The literal rule of interpretation is the first rule of interpretation
which means that if the meaning of a Statute is plain and clear
then it should not be given a twisted or strained meaning. We will
be giving a strained and artificial interpretation to the words ‘actual
physical possession’ if we say that the appellant is deemed to be
in actual physical possession. We cannot give such an interpretation E
to sub-clause (b) of Section 2(4) of the Act particularly since
clause (a) only uses the word ‘possession’ and not ‘actual physical
possession’. Hence, we reject the contention of Mr. R.F. Nariman,
learned counsel appearing for the appellant and hold that the
appellant was not in actual physical possession. F
8. The Preamble of the Act makes it clear that the Act applies
where superstructure is constructed on the land, which is leased.
Hence, the submission that clause (a) applies when there is no
superstructure erected on the vacant land which was leased is
not correct. In fact, the Act was meant to give some protection to G
leased land on which the tenant constructed some superstructure.
9. As regards the submission of Mr. Nariman that the appellant is
entitled to the benefit of sub-clause (a) of Section 2(4) of the Act,
it appears that this aspect has not been considered by the High
Court. In our opinion, the High Court should have considered H
450 SUPREME COURT REPORTS [2020] 3 S.C.R.

A whether the appellant is entitled to the benefit of Section 2(4)(i)
and sub-clause (a) of Section 2(4)(ii) of the Act.
10. We are not expressing any final opinion on the question whether
the appellant is entitled to the benefit of Section 2(4)(i) and 2(4)(ii)(a)
of the Act as in our opinion it was incumbent upon the High Court
B to have recorded a finding on the said issue. Therefore, we set
aside the impugned judgment and order of the High Court and
remand the matter back to the Division Bench of the High Court
to record a finding on the question whether the appellant is entitled
to the benefit of Section 2(4)(i) and sub-clause (a) of Section
2(4)(ii) of the Act. Needless to mention, that the Division Bench
C of the High Court shall decide the said question in accordance
with law and uninfluenced by any observation made by us in this
order except the finding that the appellant is not covered by
subclause (b) of Section 2(4) of the Act. We make it clear that
we are not expressing any opinion of our own on the other issue.
D We hope and trust that the Division Bench of the High Court will
dispose of the case expeditiously and preferably within a period
of six months from the date a copy of this order is produced before
it.
xx xx xx
E 12. We are further of the opinion that where the lessee is in actual
physical possession of the land over which he has made
construction then he is entitled to an additional benefit given by
Section 9(1)(a) (ii) of the Act. However, if the lessee who has
made construction on the land let out to him but was not
F subsequently in possession of the same, as is the case of the
appellants in the present cases, then he is not entitled to the benefit
of Section 9(1)(a)(ii) though he may be entitled to the benefit of
Section 9 (1)(a)(i). These are the questions on which the Division
Bench of the High Court will record a finding.

G 13. Therefore, we set aside the impugned judgments and orders
of the High Court and remand the matter back to the Division
Bench of the High Court to record a finding on the question whether
the appellant is covered by Section 2(4)(i) and sub-clause (a) of
Section 2(4)(ii) of the Act and is entitled to the benefit of Section
9(1). Needless to mention, the Division Bench of the High Court
H shall decide the said question in accordance with law and
BHARAT PETROLEUM CORPORATION LIMITED v. 451
R. CHANDRAMOULEESWARAN AND OTHERS [SANJIV KHANNA, J.]

uninfluenced by any observation made by us in this order except A
our finding about clause (b) of Section 2(4). We make it clear that
we are not expressing any opinion of our own on other issues. We
hope and trust that the Division Bench of the High Court will
dispose of these cases expeditiously and preferably within a period
of six months from the date a copy of this order is produced before
B
it.”
Thus, while interpreting sub-clause (b) to Section 2(4)(ii), this Court
has held that the expression ‘actual physical possession of land and
building’ would mean and require the tenant to be in actual possession
and the sub-clause(b) would not apply if the tenant has sub-let the building
or has given the premises on leave and licence basis. The aforesaid C
decision would operate as res judicata in the case of the appellant and
the landlords who were parties to the decision. In other cases, it would
operate as a binding precedent under Article 141 of the Constitution.
13. Before we go on to examine the challenge raised by the
appellant, it is apparent that the Act essentially protects the rights of D
three categories of tenants as enlisted under Section 2(4) of the Act,
viz., those covered under sub-clauses (i) and (ii)(a) who have always
been protected under the provisions of the Act; and by addition of clause
(b) with retrospective effect the tenants who were originally disallowed
the benefits on account of the proviso to Section 12 of the Act; and lastly E
as per sub-clause (c), heirs of the tenants covered under the aforesaid
categories, but not sub-tenants and heirs of sub-tenants. By excluding
sub-tenants and their heirs, the legislature has made it clear that sub-
tenants would not be entitled to benefits and rights conferred under the
Act including right to purchase the land under Section 9 or compensation
payable for the construction etc. under Sections 3 and 44 of the Act. F
Sub-tenants or the heirs of sub-tenants are not ‘tenants’ and hence in
their case the question of possession or actual physical possession is
immaterial.
4
“4. Disposal of suits for ejectment. – (1) In a suit for ejectment against a tenant in
which the landlord succeeds, the Court shall ascertain the amount of compensation, G
if any, payable under Section 3 and the decree in the suit shall declare the amount so
found due and direct that, on payment by the landlord into Court, within three
months from the date of the decree, of the amount so found due, the tenant shall put
the landlord into possession of the land with the building and trees thereon.
(2) In an application under Section 41 of the Presidency Small Cause Courts Act, 1882
(Central Act XV of 1882), in which the landlord succeeds, the Court shall ascertain
H
452 SUPREME COURT REPORTS [2020] 3 S.C.R.

A 14. The Amendment Acts of 1972 and 1973 were wide and far
reaching, beyond the object and purpose of the Act as originally enacted.
Moreover, several amendments to Sections 2(4), 9 and 12 of the Act
were with retrospective effect. We have already referred to the deletion
of the proviso in Section 12 with retrospective effect. The consequence
of the deletion was that written registered leases for land with stipulation
B
relating to ‘erection of buildings’ would no longer enjoy primacy and
would be governed by the provisions of the Act as applicable. In other
words, statutory mandate of Sections 3, 4 and 9 of the Act would apply
notwithstanding the terms of the written registered lease deed relating
to the ‘erection of buildings’ by the tenant and Section 108(h)5 of the
C Transfer of Property Act. As the proviso to Section 12 stood deleted, the
distinction carved out in terms of Section 12 between written registered
lease agreements with specific stipulations relating to ‘erection of
buildings’ and other lease agreements, ceased to be applicable with
retrospective effect and the landlords and tenants with written registered
leases were at par with those holding oral tenancies or unregistered
D
leases of land or written registered tenancies without any stipulation
with regard to ‘erection of building’ on the land. Pertinently, even before
the deletion of the words/proviso to Section 12 of the Act, the tenants, as
defined by Section 2(4)(i) and (ii)(a) were entitled to protection and

E the amount of compensation payable under Section 3 and shall pass an interim order
declaring the amount so found due and stating that, on payment by the landlord into
Court within three months of the date of the said interim order of the amount so
found due, the landlord shall be entitled to the order contemplated by Section 43 of
the Presidency Small Cause Courts Act, 1882 (Central Act XV of 1882).
(3) In in such suit or application, the Court finds that any sum of money is due by the
tenant to the landlord for rent or otherwise in respect of the tenancy, the Court shall
F set off such sum against the sum found due under sub-section (1) or sub-section (2),
as the case may be, and shall pass a decree or interim order declaring as the amount
payable to the tenant on ejectment, the amount, if any, remaining due to him after
such set off.
(4) If the amount found due is not paid into Court within three months from the date
of the decree under sub-section (1) or of the interim order under sub-section (2), or if
no application is made under Section 6, the suit or application, as the case may be,
G shall stand dismissed, and the landlord shall not be entitled to institute a fresh suit for
ejectment, or present a fresh application for recovery of possession for a period of
five years from the date of such dismissal.”
5
“108. Rights and liabilities of lessor and lessee.— [...] (h) the lessee may 1 [even
after the determination of the lease] remove, at any time 2 [whilst he is in possession
of the property leased but not afterwards,] all things which he has attached to the
H earth: provided he leaves the property in the state in which he received it:”
BHARAT PETROLEUM CORPORATION LIMITED v. 453
R. CHANDRAMOULEESWARAN AND OTHERS [SANJIV KHANNA, J.]

benefit of Sections 3, 4 and 9 of the Act. The amendments made vide A
the Amendment Acts of 1972 and 1973 did not, in any manner, dilute or
withdraw the benefit or the protection granted to the tenants not covered
by the proviso to Section 12 of the Act. The amendments vide the
Amendments Acts of 1972 and 1973 were not to dilute the rights of the
already protected tenants, but to expand the Act’s protection and scope
B
to the tenants who were denied the benefit of the Act vide the proviso to
Section 12 of the Act.
15. The amendments and modifications made by the Amendment
Acts of 1972 and 1973 whereby sub-clause (b) to Section 2(4)(ii) was
added with retrospective effect, the proviso to Section 12 was deleted
with retrospective effect and the amendments to Section 9 were made C
with retrospective effect, have to be read holistically and in entirety, for
it is a well-known canon of construction that every section of a statute is
to be construed with reference to the context and other sections of the
statute, so as, as far as possible, to make a consistent enactment of the
whole statute.6 By these amendments, the tenants excluded from the D
benefit/privilege of the Act vide the proviso to Section 12 were brought
within the ambit of the protection and rights given under the Act but with
different conditions and stipulations. In other words, sub-clause (ii)(b) to
section 2(4) is restricted and applies to only those tenants who were
covered by the proviso to Section 12 and not those tenants who were
already entitled to protection and rights under the Act. This is clear from E
the latter portion of sub-clause (ii)(b) to Section 2(4) of the Act which
refers to the proviso to Section 12 and also a decree for declaration or
possession or similar relief passed against the person on the ground that
proviso to Section 12 had disentitled such persons from claiming rights
under the Act. The amendment made by adding sub-clause (b) to Section F
2(4)(ii) vide the Amendment Act, 1973 was not to dilute or impose new
conditions on the tenants who were otherwise entitled to protection as
tenants under Section 2(4)(i) or to Section 2(4)(ii)(a) of the Act read
with Sections 3, 4 and 9 of the Act. This also flows from the legislature
using the word ‘continues in possession’ in sub-clause (ii)(a) to Section
2(4), whereas the words used in sub-clause (ii)(b) are ‘continues in G
actual physical possession’. The legislature deliberately has used
different words in sub-clauses (ii)(a) and (ii)(b). The enactment of sub-
clause (ii)(b) has to be read with other amendments made vide the
6
Raghbir Singh Gill v. Gurcharan Singh Tohra and Others 1980 SCR (3)1302
quoting R v. Board of Trade, [1965] 1 Q.B. 603. H
454 SUPREME COURT REPORTS [2020] 3 S.C.R.

A Amendment Acts of 1972 and 1973 and would accordingly apply to
those tenants who were brought under the umbrella and protection of
the Act by deleting the proviso to Section 12. Therefore, sub-clause
(ii)(b) to Section 2(4) would apply to tenants who were covered by the
deleted proviso to Section 12, whereas sub-clause (ii)(a) to Section 2(4)
would apply to tenants who had taken land on lease without any written
B
registered instrument relating to the ‘erection of buildings’.
16. No doubt, sub-clause (ii)(a) to Section 2(4) refers to land, and
the words ‘land’ and ‘building’ have been separately defined vide clauses
(2) and (1) to Section 2 respectively, with the postulate that land does
not include building, however we are not inclined to hold that the distinction
C between sub-clauses (ii)(a) and (ii)(b) to Section 2(4) is based upon
whether a tenant had constructed a building in which case sub-clause
(ii)(b) would apply and not sub-clause (ii)(a). In other words, we are not
in agreement with the contention that where the tenant of a land has not
constructed building, sub-clause (ii)(a) would apply and where a tenant
D of land has constructed a building, sub-clause (ii)(b) would apply. The
reason is obvious. The Act as per the objects and purposes was enacted
and enforced to grant certain rights to tenants who had acquired leases
of land and had thereupon constructed a building with the implied
understanding that they would not be evicted as long as they paid the
fair rent. The tenants covered by sub-clause (ii)(a) were protected under
E the Act even before the enactment of sub-clause (b) to section 2(4)(ii)
of the Act vide the Amendment Act, 1973. The Act as originally enacted
with Section 2(4) defining the term ‘tenant’ before its amendment vide
the Amendment Act, 1973 would apply to all the tenants who had acquired
leasehold land and thereafter constructed a building, except the tenants
F who had entered into written registered contracts with terms relating to
‘erection of buildings’ who were covered by the deleted proviso to Section
12.
17. Decision of the Constitution Bench of six judges in Swami
Motor Transports (P) Ltd. And Another v. Sri Sankaraswamigal Mutt
G and Another7 on which reliance was placed by the counsel for the
appellant, though relating to the Act, relates to the challenge to the
Amendment Act, 1960 by which non-residential buildings constructed
on the leasehold land in the municipal towns of Tanjore were excluded
and denied the benefit of the Act. This judgment upheld constitutional
7
H 1963 Supp (1) SCR 282
BHARAT PETROLEUM CORPORATION LIMITED v. 455
R. CHANDRAMOULEESWARAN AND OTHERS [SANJIV KHANNA, J.]

validity predicated on the principle of classification under Article 14 and A
also the right to property under Article 19(1)(f) read with Article 31(1)
of the Constitution. Even in respect of pending ejectment proceedings, it
was observed that the law in India does not recognise equitable estates.
Further, the statutory right to purchase land is, or confers, no interest or
right in the property but only a right to purchase land. In the view of this
B
Court, a statutory right to apply for the purchase of the land is a non-
proprietary right. On the question of equitable estates, it was observed
that Section 9 of the Act confers only a right in respect of the land
owned by the landlord and not in the superstructure which was owned
by the tenant. The right of the tenant on the superstructure is neither
taken away nor affected under Section 9 of the Act or the amendment C
made vide the Amendment Act, 1960. Even earlier, this Court in Dr.
K.A. Dhairyawan and Others v. J.R. Thakur and Others 8, after
referring to several decisions of the Privy Council, had held that there
was no absolute rule of law that whatever is affixed or built on the soil
becomes a part of it, and is subjected to the same rights of a property as
D
the soil itself. We do not in India apply the doctrine of English law as to
buildings viz. that they should belong to the owner of the land. Where
clause (h) of Section 108 of the Transfer of Property Act would apply,
the lessee can remove all the structures and the buildings erected on the
demised land while he is in possession of the property but not afterwards,
meaning thereby the ownership of the building is with the lessee and not E
with the lessor. At the same time, nothing prevents the lessee from
contracting to hand over the building or the structure erected on the land
constructed by him without receiving compensation.
18. In P. Ananthakrishnan Nair and Another v. Dr G.
Ramakrishnan and Another, 9 a Division Bench of this Court F
interpreting Section 2(4) and Section 9 of the Act had held that as per
the mandate of Sections 3, 4 and 5, post the 1972 and 1973 amendments,
it is mandatory for the court to first decide the minimum extent of land
“which may be necessary for the convenient enjoyment by the
tenant”. The words in italics were emphasised by the Division Bench to
G
observe that the court may, on facts of a particular case, come to a
conclusion that the tenant may not require any portion of the land and in
that event it may reject the application and decree the suit for ejectment

8
1959 SCR 799
9
(1987) 2 SCC 429 H
456 SUPREME COURT REPORTS [2020] 3 S.C.R.

A and direct the landlord to pay compensation to the tenant. Section 9
confers a privilege on the tenant and not a vested right, but the privilege
granted by the statute is equitable in nature. Elucidating further, it was
observed:
“11. […] The enquiry presupposes that the tenant making the
B application has been in the occupation of the land and the
superstructure wherein he may be either residing or carrying on
business, and on his eviction he would be adversely affected. The
policy underlying Section 9 of the Act, is directed to safeguard the
eviction of those tenants who may have constructed superstructure
C on the demised land, so that they may continue to occupy the
same for the purposes of their residence or business.”
In the said case, an eviction decree was passed observing that
the tenant had in the small portion of the land kept account books of the
business and rest of the land and structure standing thereon had been in
D occupation of sub-tenants since 1964.
19. In S.R. Radhakrishnan and Others v. Neelamegam10, this
Court had again interpreted Section 2(4) and 9 of the Act after referring
to the dictum in P. Ananthakrishnan (supra) elucidating that the policy
underlying Section 9 is to safeguard eviction of those tenants who may
E have constructed superstructure on the demised land, so that they may
continue to occupy the same for the purpose of residence or business.
Thus, the tenant not in actual possession of most of the demised premises
in P.Ananthakrishnan (supra) had suffered a decree for eviction.
Therefore, it was held in P. Ananthakrishnan (supra) that it will be
unreasonable to direct the landlord to sell the land to the tenant. In the
F said case, application under Section 9 filed by the legal heir of the tenant
was dismissed observing that admittedly he was not in possession of the
demised premises and had ceased to be a tenant.
20. The counsel for the appellant had made a valiant attempt to
distinguish the said decisions as P. Ananthakrishnan (supra) was a
G case of sub-letting and in S.R. Radhakrishnan (supra), the court had
relied upon the reply of the defendant No.1 stating that he had nothing to
do with the property as defendant Nos. 2 and 3 were in possession

10
H (2003) 10 SCC 705
BHARAT PETROLEUM CORPORATION LIMITED v. 457
R. CHANDRAMOULEESWARAN AND OTHERS [SANJIV KHANNA, J.]

thereof. It is correct that P. Ananthakrishnan (supra) was a case of A
sub-letting which means parting of possession by the tenant to the sub-
tenant. However, the said case records observations as to the object
and purpose behind Section 9 and the tenants whose interests were
sought to be protected. In S.R. Radhakrishnan (supra), the land had
been given on lease to the father of the defendant No. 1 who had B
thereafter in terms of lease made constructions for setting up and running
a printing press, in which business he had taken his younger brothers,
defendant Nos. 2 and 3, possibly as partners. Thereafter, he had executed
a deed in favour of defendant Nos. 2 and 3 relinquishing his business of
the printing press. For the same reasons, we would hold that the
observations made relating to the interpretation of Sections 2(4) and 9 C
are relevant even if we hold that the ratios are not applicable as the
facts are not identical.
21. In view of the aforesaid discussion, we hold as under:
(I) Sub-clauses (i) and (ii)(a) to clause (4) of Section 2 of the D
Act apply to all tenants who had entered into oral or
unregistered written agreements or registered written
agreements without any stipulation with regard to ‘erection
of buildings’ for taking land on lease, and had subsequently
constructed buildings. Such tenants would be entitled to
protection of the Act provided the tenant satisfies the E
conditions mentioned in sub-clauses (i) or (ii)(a) to clause
(4) of Section 2 of the Act.
(II) Paragraph 1 of sub-clause (ii)(b) to clause (4) of Section 2
of the Act applies to tenants who are not entitled to the
rights under the Act by reason of the proviso to Section 12 F
which stood deleted vide the Amendment Act, 1972.
Paragraph 2 of the said sub-clause applies to cases where
a decree of declaration or decree or an order of possession
or similar relief has been passed against a tenant on the
ground that the proviso to Section 12, which was omitted G
by the Amendment Act, 1972, disentitles the tenant from
claiming rights under the Act. Accordingly, sub-clause (b)
to Section 2(4)(ii) would apply only to tenancies which were
earlier excluded from the protection under the Act vide the
H
458 SUPREME COURT REPORTS [2020] 3 S.C.R.

A proviso to Section 12 which stands deleted with
retrospective effect vide the Amending Act, 1972.11
(III) Sub-clause (ii)(c) to clause (4) of Section 2 states that heirs
of a tenant referred to in sub-clause (i) or sub-clauses (ii)(a)
or (ii)(b) would be entitled to benefit of the Act. However,
B it expressly excludes a sub-tenant or heirs of the sub-tenant.
22. Recording the aforesaid position, we dismiss the present appeals
by the appellant, that is, the three petroleum companies, and uphold the
orders passed by the High Court that the appellant tenants would not be
entitled to the benefit and rights under the Act unless they are in actual
C physical possession of the building constructed by them. In other words,
in case the appellants have let out or sub-let the building or given it to
third parties, including dealers or licensees, they would not be entitled to
protection and benefit under the Act.
In the facts of the case, there would be no order as to costs.
D
Ankit Gyan Appeals dismissed.

E

F

11
Paragraph 2 in sub-clause (ii)(b) to clause (4) of Section 2 of the Act, has been
interpreted in different judgments by the Madras High Court, including the decision
in Haridas Girdhardas and Others v. M. Varadaraja Pillai and Another [(1976) 89
Madras Law Weekly 1)]. Pertinently, in the aforementioned case, the Madras High
G Court dealt with the applicability of sub-section (3A) to Section 9 of the Act which
stipulates the reopening or reviewing of a decree or order passed, in terms of the
deleted proviso to Section 12 of the Act, against the interests of the tenant, that is,
those who are covered under paragraph 2 of sub-clause (ii)(b) to Section 2(4) of the
Act. We are not required to examine the true impact and effect of the said paragraph
2 or sub-section (3A) to Section 9 of the Act as they are not relevant for the present
H decision. On this aspect, we make no comment.