Holding

A sub‑tenant is deemed a tenant for the purposes of the fourth proviso to section 21, and the comparative hardship of both the sub‑tenant and the landlord must be taken into account.

Summary

The landlords of a shop applied under section 21 of the Uttar Pradesh Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 for release of the premises for personal use, invoking the fourth proviso which requires consideration of comparative hardship. The shop had been let to Krishan Kumar, who, with the landlords' consent, sub‑let part of it to Shyam Babu (the appellant). The prescribed authority granted release against the sub‑tenant but not the original tenant; the District Judge affirmed, and the High Court dismissed the appellant's writ petition, holding that the fourth proviso only contemplated the hardship of the tenant, not a sub‑tenant. The Supreme Court examined the definition of "tenant" and "landlord" under the Act and held that a sub‑tenant, who pays rent to the tenant‑in‑chief, is to be treated as a tenant for the purpose of the fourth proviso. Consequently, the comparative hardship of both the sub‑tenant and the landlords must be considered before granting release. The Court allowed the appeal, set aside the orders of the lower courts, and remanded the matter to the District Judge to reconsider the application in light of this interpretation.

Issues considered

Whether a sub‑tenant is covered by the fourth proviso to section 21 of the Uttar Pradesh Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 for the purpose of assessing comparative hardship.

Legislation cited

Industrial (Temporary Control of Rent and Eviction) Act, 1947s. s.2 (cl. g)
Uttar Pradesh Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972s. s.21 (fourth proviso), s. s.3

Subjects

sub‑tenanttenantlandlordcomparative hardshipsection 21Uttar Pradesh Urban Buildings Actevictionleasesub‑lettingstatutory interpretation

Judgment

A 30
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SHAYAM BABU
1'.

DISTRICT JUDGE, MORADABAD. & OTHERS
B December 14, J 983
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[D.A. DESAI°,, R.B. MISRA AND RANGANATH. MISRA, JJ.)

. Uttar Pradesh Urban Buihli11gs (R~gulation oj Letting-, Rent a.nd EviCtion) Act
1972-.s. 21 fourth proviso-:-!nterpreiaiion Of-1¥hether protects suh-te11a1Jt.

c The respondeht-landlords had Jet out a shop to a' tenant who had, with
· the consent of the landlords, sub-let the sa1ne to t!ie appellant. The landlords
n1oved an applfoation~ under.s. 21 of the Uttar Prade;h _Urban Building') (R~gula
tion of LettiOg, P...ent nnd, Eviction) Act, 1972 against the tenant and· the sub·-
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tenant fo1' telease of the pren1ises on. the ground of bo.natidC· require1nent. The
Presc_ribed ·authority allowed the application against the appellant'.and disn1issed
agµinst the tenant. In appeal the District ... udge. con-finned the order Of the pre."
D scribed .authority. In ~·writ "petition tlic app~llant ci}'allenged the·order of the
District Judge. The High Court dis1nisScd the writ petition observing that the
fourth proviso to s.21 conteJr.plated. the consid.efation of the likely hards~ip of
the .tenant or the landlord only rind not of the sub-tenant. Hence this appeal.

Allowi11g. the ap'Peal,

E HELO: All that the relevant proviso t~~ s.21 requires is ti1at the con1-
parative hardship of the tenant_ as. al<:o that of the landlord shall .b~ t"airen..,into ·
aCco"unt before passing any order of release or refusal to rrlease. If ~he sub-
. tenancy had been created withollt the consent Or the landlord tl1e position 1night
have been different. 'f.he sub:tenanf for .the purp0ses of the fourth proviso to s.21
would virtually b~ a.tenant inasn1uch as rent is payble by hi1n to the tenant-in-
~ chief, who to all intents and pu:·poses will be a ·JandJord qua the sub-tenan't. To
interpret the section in the way (l._I; the High Court has interpreted would be
F · defeati'rrg the very sa-lut~ry purpose 01 the A.ct. f33 l-1.; 34 A-BJ

Bbul!an Singh v: Bah11 Ra111 ( 1965) A.L.J. 544 referred to~·

~ In the instant case, the appellant· was entitled to the .Protection of the
fourth proviso to s. 2i and the coJnparativc hardship of the appell~nt as well as
that of the landlords should have been taken into account before disposing of an
G ipplication undcr·s.21 of the A~t. The Courts bl~low ha\1 :! failed to excrci'se
jurisdiction vested in 'then1 in not considering ·the likely h<>rdship of t[1P:
appellant .. [34 C-DJ

CIVIL ArPELLATE)lcRISDICTION : Civi.1 Ajopeal N.o. 230 of 1978.
H
·From the Judgment and Order.dated 19th January, 1978 of the
SHYAM BABU ": lllSTT. JUDGE (Misra, J.) 31

High Court of Jadicature at Allahabad in _Civil Misc. Writ No. 355 A
of 1977".
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Yoge;hwar basad and Mrs. Rani Chabbra, for the App~llant

J.P. Goyal, Ra.f.esh and S.K. Jain for the Resp011dents.
B
., The Judgment of the Court was delivered by

MISRA, J. The present appeal by special leave is directed against
the judgment dated 19th_ of January, 1978 of the Allahabad- High
Court. The sh'Ort question for <;onsideration in this appeal i's whe~
ther a sub-tenant is entitled to the protection of the fourth proviso C
·to s.21 oft\ie Uttar Pradesh Urban Buildings (Regulation of Letting,
Rent and Eviction) Act, 19.72.

Th~ material fact' to. bring·out the point for consideration lie
in a narrow·c~mpass. One' Murari Lal was the owner of the dis-·
puted ~hop. . During his lifetime a partition took place betwee;1 him D
and the other ·members of his family iri 1937. The shop in dispute
fell to the share.of Murar.i Lal and Narendr.a Mohan, his eldest son.
,;\fter the d~ath of Murari Lal in 1960 his interest devolved upon his
sons·Rajendra KumH.and'Brijendra Kumar along with their brother
Narendra Mohan .
•
It appears thar the shop in suit had been let ~ut to one Krishan
Klllnar. He in his turn inducted Shyam Babu, the 'present appe-
'f' llant, as his sub-tenant Ill 1962. Rajendra Kumar and Brijendra
' K'1m:tr liled a suit No. 181 of 1968 in the Court of Munsif for the
evi~tion of the original tenant as wel I as the sub-tenant, on the grourrd
of i \legal subletting as also for the recovery of arrears· of rent. That F
suit \vas co11tested by the ten.ant its well as the sub-tenant on the
• ground ihat.the sub-tenancy had been created with the consent of
the then landlord and therefore subletting \vas legal.

The leatn~d Mu.nsif dismissed the·suit by his order dated. 24th
'' April, 1973 holding that the sub;tenancy created by Krishan Kumar G
· in fov0ur of theappellant Sh yam Babu was with the consent of the
landlord-and as such ne.ither Krisha·n Ku1nar nor Shyam Bahu· \Vas
1iable to eviction on that ground.

· '[t appears that during the pendency of the suit 'the U.J'. Utban ·H
Building (Regulation of Letting, .~ent and Eviction) Ac\, 1972

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32 SUPREME COURT R.EPORTS (1984] 2 S.C.R.

A (hereinafter referred to as the new Act) cam·e into force on 15th July,
1972. Rajendia Kumar .and Brijendra Kumar,, the landlords, moved
• an applfoation under s.21 of 1he new Act for the release of the pre-
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mises in occupation of the appellant and Krjshan ;Kumar on the
ground that the same is bonafidc required for their personal .use. '
The application' w1.s resisted by the tcnan.t as well as the sub-tenant:
B They denied that the need of the landlords was genuine. Tbey aho
set µp their own needs.and contended.that they would suffer greater ,..
'hardship if the application for release was allowed.

The prescribed authority allowed the application with respect
to the portion in occupation of the appdlant Shyam Babu but dis-
c missed 'the same ·as aga.inst the odginal tenant Krishat• Kumar.
Feeling aggrieved the landlords.as well as tlie sub-tenant filed two
·separate appeals before 'tho District Judge to the extent the order
went against them. The landlords· were aggrieved by the order in-
sofar as their application was rejected again1t Klishan :Kumar, the
original tenant·, while the appellant challenged the release. of the
D premises granted to the landlords against him. Both the app~als were
disposed of by.a common judgment of: the District Judge on 24th
·March, 1977 confirming the. order passed by the prescribed authority.
The ·landlords submitted to the order passed by the District Judge .
. The appellant, howeve~, sought to challenge ~he order of the District
Judge by filing
. . a writ petition in the. High' Court.
E
The contention raised by the appellant was that the pre.cribcd
authority as well as the Appellate Court committed it manifest error
of law in allowing the application for release of the premises in
favour of the·Jandlords without considering the comparative hard-
ship likely to be caused to the appellant or ;o the respondent land
F, lords by the order of release or refusal to release the premises within
the meaning of fourth proviso to s. 21.ofthe new Act. In the opinion
of the High Court the proviso contemplated the consideration of •
the likely hardship of. the, tenant or.the l~ndlord and as the appellant
was Ol)ly a sub-tenant the proviso did ·not obligate the authority fo
consider his hardship.
G
It will be appropriate at this, stage to read the relevant proviso
to s.21 as the decision of the case hinges on the construction of the
proviso

H "Provided also that the prescribed authority shall,
except in cases provided for in the Explanation, take into

•
SHYAM BABU v. DISTT. JUDGE· (Misra, J.)

account the likely hardship to the tenant from the grant of
the application as against the likely hardship' to the landlord
from the refusal of the application and for that purpose
'. shall have 'regard to such factors as may be prescribed."

It may be recalled that in the earlier suit No. 181 of 1968 filed,
lty the landlords it was found as a fact that the appellant' Sh yam Babu . :I
wa• inducted.as a sub-tenant by the tenant-in-chief with the consent
<>f the landlords. It was qn this ground that the landlords' suit
wa1 dismi1sed against the tenant-in-chief as wdl as the sub-tenant.·
A feeble attempt was made before the Bigh Court 09 behalf of ihc

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landlords to challenge that finding but that was rejected and we think
rightly. Even an erroneous finding of. fact between the parties will fr
be binding on them. The landlords, ·ihercfcrc, cannot poS>ibly
urge that the sub-letting was not with the consent of the laicdlord• .
..
.. ;.-\, If once it is accepted that the sub-tenancy created by th.e .tenant-
iQ-:hief in favour of the appellant was with the consent of the le.nd-
lords his possession cannot be said to be illegal. ·Jn this view of the
matt.er we see no reason why he should be deprived of the protec-
tion of the fo~rth proviso .to s.21 of the new Act. It is true that the
new Act was intended to give relief to the tenant. 'Landlord' and
'tenane are defined terms in the Act. ·clause (j) of s.3 defines.'land-
lord' thus :

"(j) "landlord", in relation io a buildi"g, means a person.

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to whom its rent is or if the building were let woul.d be,
·~ P.ayable, and includes; except in clause (g), t.he agent or
attorney, or such person;"

Section 3. (a) defines tenant as ; F
a
"(a) "Tenant' in relation to b_µilding, me3ns a pc~ son
1

by whom its rent is payable, .......... .

The appellant who is a sub-tenant pays rent to the tenant-in:
chi.cf and the tenant-in-chief in his iurn pays rent to the landlord ..
Between the appellant and the tenant-in-chief the. tenant,in-chief
would be the landlord and the appclbnt, the sub-tenant, would te
the tenant. All tb'at the relevant proviso to s.21 requires is thalthc
comparative hardship of'the tenant as also that' of the landlord sba 11
be taken int'o account before passing any order of release or refusal B
to release. If the sub-tenancy had been created without the consent

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34 $UPREME COURT REPORTS (1984] 2 S.c.R.
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A of the landlord the posHion might have been different. The sub-
tenant' for the purposes of the fourth proviso to ·s.21 would virtually
be a tenant inasmuch as rent is payable by him to tl1e tenant-in-chief,
who to all intents and purposes will be a landlord qua the sub-tenant.
To interpret the section i.n the way as the High Court has interpreted
would be' defeating the very salutary. purpose of the new Act.
B
A similar question came up for consideration before a· Divi- t
sion Bedch of the Allahabad High Court in Bhullan Singh v. Babu
Raml based on cl. ·(g) of s.2 of the l.l.P. (Temporary Control of
·Rent and Eviction Act, 1947. The High Court took.the view that
.the term 'tenant' as defined in cl. (g) of s.2 of the Act includes a S\lb- I,

rr·
c tenant.

Having considered th~ argument of the counsel for the parties
, we ar• of the firm view that the appellant was entitled to the prot~c
tion of the fourth proviso to s.2.1 and the comparative hardship of
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the appellant as well as that of the landlords should have been taken.
D into account'before disposing of an application undtr s.21 of the new
Act. The Court below in our opinion have failed to exercise juris-
dictton vested in thorn in not considering the likely hardship of the
appellant.

'" For the reasons given above the appeal must succeed. It is
E accordingly allowed a~d the impugned judgment of the High Court
and those of the District Judge as well as of the p,re~cril:ed authority

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on the question of comparative hardship are set aside. The case
is remai]ded to the-Di£trict Judge who will send it to the prescribed
a1ithority under the new Rent Act to dispose of the application under
l s.2l in the light of the observations made above after considering the
F likely hardship of the appellant and that of the landlord-respondents.
In the circumstances of the case, we direct the parties to bear their '1·
costs.

H.S.K . Appeal all•wed.

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(!)' (1965) A.L.J. 544 .

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