Holding

Objections to the validity of a limited tenancy under Section 21 must be raised during the tenancy; belated objections are not entertained and the landlord is entitled to possession after the tenancy expires.

Summary

The landlady obtained a limited tenancy for two years under Section 21 of the Delhi Rent Control Act, 1958. After the tenancy expired, the tenant refused to vacate and the landlady applied for a warrant of possession. The tenant raised an objection to the validity of the limited tenancy only after the lease had lapsed. The Rent Controller entertained the belated objection and dismissed the landlady’s petition; the same result was upheld by the Rent Control Tribunal and the Delhi High Court. On special leave, the Supreme Court held that any challenge to the validity of a limited tenancy under Section 21 must be made during the tenancy, and that the landlord is entitled to possession once the fixed period ends. Consequently, the Court allowed the appeal, reversed the lower decisions and ordered the landlady to be put into possession by 31 March 1990.

Issues considered

Whether a tenant can raise an objection to the validity of a limited tenancy created under Section 21 of the Delhi Rent Control Act after the tenancy has expired.
Whether the Rent Controller may entertain such belated objections and deny the landlord’s possession.
Interpretation of the conditions and purpose of Section 21 vis‑à‑vis Section 14 of the Act.
Effect of precedents such as Noronah’s case, Vohra’s case, and Shiv Chander Kapoor’s case on the present dispute.

Legislation cited

Delhi Rent Control Act, 1958s. 14, s. 21

Subjects

limited tenancySection 21Delhi Rent Control Actevictionbelated objectionlandlord possessionrent control

Judgment

SMT. YAMUNA MALOO A
v.
ANAND SWARUP

) FEBRUARY 28,1990

[RANGANATH MISRA, M.M. PUNCHHI AND B
~· K. RAMASWAMY, JJ.]

Delhi Rent Control Act, 1958: Section 2 I-Limited tenancy-
Objection to validity-To be raised before the lease lapses.

The appellant-landlady and the respondent-tenant appeared C
before the Rent Controller for creation of a tenancy under Section 21 of
the Delhi Rent Control Act, 1958. Accordingly, the authority passed an
order creating tenancy for a limited period of two years. Since the
respondent did not vacate the premises on the expiry of two years, the
appellant moved the Rent Controller for issuance of warrant of posses-
sion. The Respondent filed his objection. Entertaining the objection the D
Rent Controller dismissed the petition, holding that the order granting
permission for the tenancy under section 21 of the Act was not in
accordance with law. The appellant's first appeal before the Rent Con-
trol Tribunal, as also her second appeal before the High Court met the
same fate.
E
This appeal, by special leave, is against the High Court's order
dismissing the second appeal'in limine.

On behalf of the appellant, it was contended that the Rent Con-
troller should not have entertained the objection of the respondent as
the same has not been filed during the currency of the tenancy. It was F
also contended that some of the considerations which weighed with the
Rent Control Tribunal were not relevant for judging the bona [ides and
genuineness of actions taken at the time of creating the tenancy.

Allowing the appeal, this Court, ·
G
....._ HELD: l. Section 14 of the Delhi Rent Control Act, 1958 deals
with a normal tenancy and protects the tenant against unreasonable
eviction. Section 21 of the Act, on the other hand, places the tenant
outside the purview of s. 14 and provides for an order of eviction at the
time of creation of the tenancy. There is a purpose behind enacting s. 21
of the Act. The Legislature considered it appropriate ·that should a H

715
716 SUPREME COURT REPORTS [1990) I S.C.R.

A
landlord not need his residential premises for a period, instead of keep-
ing it vacant the same could he available for a tenant's use on being let
out for a limited period conditional upon the tenant's surrendering
r
possession as soon as _the tenancy terminates by effiux of time and the
need of the landlord revives. [719G-H; 720A]

B 2.1. The rule in Noronah's case has to be confined to a particular
set of facts and should not be freely extended so as to take away the
effect ofs. 21. [724F-G)

2.2. In Vohra's case and in'Shiv Chander Kapoor's case, though
not arising for determination in either, it has been stated while laying
'
down the rule that proceeding to challenge limited tenancy has to be
c taken during the currency of the tenancy, an objection filed by the
tenant could be looked into, is indeed an obiter. The rule having been
stated to the contrary in Vohra's case, there was indeed no warrant to
)-
indicate the contra situation. Perhaps to meet the eventuality which
might arise in a particular case, the exception has also been indicated. If,
I:> the tenant has an objection to raise to the validity of the limited tenancy
it has to be done prior to the lapse of the lease and not as a defence to the
landlord's application for being put into possession. Even if such an
exercise is available that must be taken to be very limited and made
applicable to exceptional situations. Unless the tenant is able to satisfy
the Controller that he had no opportunity at all to know the facts earlier
E and had come to he aware of them only then, should such an objection
be entertained. [725E-H]

2.3. In the facts and circumstances of the present case the belated
objections of the tenant should not have been entertained and prayer
for possession made by the landlady after the limited tenancy ran out '{
I
F should have been granted. [726A)

S.B. Noronah v. Prem Kumari Khanna, [1980] 1 S.C.R. 281;
J.R. Vohra v. India Export House Pvt. Ltd. & Anr., [1985] 2 SCR 899;
Jnder Mohan Lal v. Ramesh Khanna, [1987] 4 SCC I and Shiv Chander
Kapoor v. Amar Bose, JT 1989 (4) SC 471, referred to.
G
[This Conrt directed that the landlady be put into possession of ~
the premises by 31st March, 1990.]

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1319
of 1990.
H
SMT. YAMUNA v. ANAND SWARUP [MISRA, J.] 717

'f" From the Judgment and Order dated 7.9.1987 of Delhi High Court
A
in S.A.O. No. 99/1987.

Dr. L.M. Singhvi and Dalv.eer Bhandari for the Appellant.

•
Dr. Y.S. Chitale and A.K. Sangal for the Respondent.
B
The Judgment of the Court was delivered by

-
RANGANATH MISRA, J. Special Leave granted.

This is an appeal by the landlady whose application for being put
in possession of the premises on the expiry of a limited tenancy of two
years under section 21 of the Delhi Rent Control Act (hereinafter c
.J referred to as 'the Act') has been dismissed by the Rent Controller,
the Rent Control Tribunal and the High Court.

On 30th September, 1976, the appellant-landlady and the res-
pondent-tenant appeared before Shri M.A. Khan, Additional Rent D
Contr:iller for creation of a tenancy under s. 21 of the Act. The Addi-
tional Rent Controller recorded the statements of both the landlady
----../ and the prospective tenant and made the following order:

"Having regard to the facts stated in the petition and the
statement of the parties made above permission under sec- E
: tion 21 of the Delhi Rent Control Act is granted to Smt.
Yamuna Maloo applicant to let out ground floor of her
~
premises No. B-2/104, Safdarjung Enclave, New Delhi
comprising of drawing cum dining hall, two bed rooms with
'· attached bath room, kitchen, parking place and a small
T lawn delineated in the enclosed plan Ex. AI, to Mr. Anand F
Swarup respondent for residential purposes for a limited
period of two years with effect from 1.10.76."

After the expiry of the two year period, when the respondent did
not vacate the premises, the landlady moved the Rent Controller for
issuance of warrant of possession to which the tenant filed his objec- G
tion. The Additional Rent Controller entertained the objection and
dismissed the landlady's petition for being put into possession. There-
upon the landlady moved the Rent Control Tribunal in appeal and
when she failed before it, a second appeal was filed before the High
Court which was dismissed in limine.
H
718 SUPREME COURT REPORTS [1990) 1 S.C.R.

A The Controller relied upon the judgment of this Court in S.B. y '""
Noronah v. Prem Kumari Khanna, [1980) 1 S.C.R. 281 and came to I
hold:

"I have carefully gone through the execution applica-
tion, the objections, the evidence on record, the original
file in which the permission was granted and have heard the
learned counsel for parties. I am of the view that the order
dated 30.9.75 granting permission was not in accordance ...

-
with law and that the applicant/petitioner is not entitled to
obtain possession of the premises in dispute under section
21 of the Delhi Rent Control Act."

C Noronah's case had stated:
"Of course, there will be presumption in favour of
the sanction being regular, but it will still be open to a party
to make out his case that in fact and in truth the conditions
which make for a valid sanction were not present."

It is interesting to note that by the time the appellant's appeal
came up for hearing before the Tribunal, Shri M.A. Khan who as an
Additional Rent Controller had approved the tenancy by his order
dated 30th September, 1976, on being judicially satisfied that the
E tenancy under s. 21 of the Act could be created had become the Rent
Control Tribunal. He noticed this fact in his appellate order dated 11th
April, 1986, by stating:

"In this appeal, the validity and executability of the order
dt. 30.9.76 is disputed which was passed by me as Addi.
Rent Controller. Since there is no other Rent Control Tri-
bunal, therefore, in exigency of the situation I have no
option but to proceed to decide this appeal."

He concluded:

"The appellant in the application and in her statement did
not give the reason for letting out the premises for two
years only. She even did not give the reason in application
for recovery of possessfon. In reply to the objection of the
respondent, she states that she was residing in Vasant
Vihar at a house which was allotted to her husband by the
H employer. There was no possibility of her vacating the said
SMT. YAMUNA v. ANAND SWARUP [MISRA, J.] 719

.• house and shifting to the disputed premises. The first floor
of the disputed premises was also let out by her to another A
tenant for a limited period. She did not disclose that she
intended to create a limited tenancy in respect of the first
floor also. Further the premises were let after an advertise-
ment of 'to let' in Hindustan Times dt. 25.9.76. It is con-
ceded that in the advertisement it was not specified that the B
premises were available for letting for two years only. All

..
these facts proved that the appellant did not require the
premises for occupation after two years and that these pre-
' mises could have been let out for an indefinite period. She
made a wrong statement before the court. She also con-
cealed the material facts from the court. She obtained the
permission from the court under section 21 by playing c
fraud. The order passed under section 21 is therefore
invalid and in execution thereof, the respondent cannot be
evicted.''

We have already said that the second appeal was dismissed in D
limine.

Lengthy arguments were advanced at the hearing in support of
the respective stands.

Counsel for the landlady argued that the Additional Rent Con- E
troller should not have entertained the objection of the tenant to the
execution of the eviction order as the same had not been filed during
the currency of the tenancy; it was further argued that some of the
considerations which weighed with the Rent Control Tribunal were
not at all relevant for judging the bona fides and genuineness of actions
taken on 30th of September, 1976, at the time of creation of the F
·tenancy. On the side of the tenant, the contentions which had
prevailed with the Additional Rent Controller and the Rent Control
Tribunal were reiterated.

Section 14 of the Act deals with a normal tenancy and protects
the tenant against unreasonable eviction. Section 21 of the Act, on the G
other hand, places the tenant outside the purview of s. 14 and provides
for an order of eviction at the time of creation of the tenancy. There is
a purpose behind enacting s. 21 of the Act. The Legislature considered
it appropriate that should a landlord not need his residential premises
for a period, instead of keeping the same vacant the same could be
availahle for a tenant's use on being let out for a limited period condi- H
720 SUPREME COURT REPORTS [ 1990] 1 S.C.R.

tional upon the tenant's surrendering possession as soon as the tenancy
A terminates by efflux of time and the need of the landlord revives. The
conditions to be fulfilled at the time of creation of such a tenancy are
-
three, namely, (i) the landlord would not require the premises for a
particular period, (ii) the Controller must be satisfied about that posi-
tion, and (iii) the tenant agrees to vacate at the end of the period.
B
In Noronah's case, supra, a two-Judge Bench dealt with this
question. This Court then said:

"We must notice that section 21 runs counter to the general
scheme and, therefore, must be restricted severely to its
narrow sphere. Secondly, we must place accent on every
c condition which attracts the section and if any one of them
is absent the section cannot apply and, therefore, cannot ~...:.
arm the landlord with a resistless eviction process. Thirdly, ·
we must realise that the whole effect of section 14 can be
subverted by ritualistic enforcement of the conditions of
sanction under section 21 or mechanical grant of sanction
therein. Section 21 overrides section 14 precisely because it
is otherwise hedged in with drastic limitations and safe-
guards itself against landlords' abuses. Y'
It is true that the judgment of this Court which is dated August
E 16, 1979, was not in existence when Shri Khan sanctioned the tenancy
but the law then in force was not different. In fact, the orders out of
which that appeal arose had also taken the same view. This Court in
Noronah's case further said:

"When an application under section 21 is filed by the land- '(
F lord and/or tenant, the Controller must satisfy himself by
such inquiry as he may make, about the compulsive
requirements of that provision. If he makes a mindless
order, the Court, when challenged at the time of execution,
will go into the question as to whether the twin conditions ...
for sanction have really been fulfilled."
G
A three-Judge Bench of this Court in J.R. Vohra v. India Export ~.
House Pvt. Ltd. & Anr., I1985] 2 SCR 899 was examining the require-
ment of .notice to the tenant when at the expiry of the period of
tenancy the landlord had applied for being put in possession. While
so examining that question this Court approved the following observa-
H tions in Noronah's case:
SMT. YAMUNA v. ANAND SWARUP [MISRA, J.] 721

"Parliament was presumably keen on mru<imising accom-
modation available for letting, realising the scarcity crises. A
One source of such spare accommodation which is usually

, shy is potentially vacant building or part thereof which the
landlord is able to let out for a strictly limited period pro-
vided he has some credible assurance that when he needs
he will get it back. If an officer is going on other assignment
for a particular period, or the owner has official quarters so
that he can let out if he is confident that on his retirement
B

he will be able to re-occupy, such accommodation may add
to the total lease-worthy houses. The problem is felt most
for residential uses. But no one will part with possession
because the lessee will become a statutory tenant and, even
if bona fide requirement is made out, the litigative tiers are c
so many and the law's delays so tantalising that no realist in
his sense will trust the sweet promises of a tenant that he
will return the building after the stipulated period. So the
law has to make itself credit-worthy. The long distance
between institution of recovery proceedings and actual dis- D
possession runs often into a decade or more-a factor of
despair which can be obviated only by a special procedure.

Section 21 is the answer. The law seeks to persuade
the owner of premises available for letting for a particular
or limited period by giving him the special assurance that at E
the expiry of that period the appointed agency will place
the landlord in vacant possession."

Noronah's judgment was approved to this extent. In the three succeed-
rI ing paragraphs in Vohra's decision. Noronah's case was also referred
to, Dealing with the contentions relied upon in Noronah's case, F
Tulzapurkar, J. who delivered the judgment of the Court, observed:

"At the outset we would like to observe that in Noronah's
case the question whether a prior notice is required to be
served upon the tenant before issuance of warrant of pos-
session in favour of the landlord under section 21 did not G
arise for consideration. It was a case where upon receipt of
landlord's application for recovery of possession under the
section the tenant raised pleas that the premises had been
let out for non-residential purposes and that the sanction or
permission granted for the creation of the limited tenancy
was vitiated by fraud and collusion and the question that H
722 SUPREME COURT REPORTS [1990] 1 S.C.R.

A
arose for consideration was whether at that stage the Rent
Controller could go into and consider such pleas and this
'f
court has ruled that the Controller should consider those
pleas even when raised at that stage."

A little later Justice Tulzapurkar further observed:
B
"In fact even in Noronah's case this Court has observed that
there will be a presumption in favour of the sanction or
permission being regular and if that be so, we fail to
appreciate as to why the Rent Controller should invite such
pleas of fraud, collusion etc. at the instance of the tenant by
being required to serve a notice upon him before issuing
c the warrant of possession in favour of the landlord espe-
cially when the scheme of sec. 21 and the connected rele-
vant provisions do not require it."

The three-Judge Bench thereafter went to consider the remedy
D available to the tenant in a case where the objections were as in the
present case:

"What then is the remedy available to the tenant in a case
where there was in fact a mere ritualistic observance of the
procedure while granting permission for the creation of a
E limited tenancy or where such permission was procured by
fraud practised by the landlord or was a result of collusion
between the strong and the weak? Must the tenant in such
cases be unceremoniously evicted without his plea being
inquired into? The answer is obviously in the negative. At
the same time must he be permitted to protract the delivery
F of possession of the leased premises to the landlord on a
false plea of fraud or collusion or that there was a mechani-
cal grant of permission and thus defeat the very subject of
the special procedure provided for the benefit of the land-
lord in section 21? The answer must again be in the nega-
tive. In our view these two competing claims must be
G harmonised and the solution lies not in insisting upon
service of a prior notice on the tenant before the issuance
of the warrant of possession to evict him but by insisting
upon his approach the Rent Controller during the currency
of the limited tenancy for adjudication of his pleas no
sooner he discovers facts. and circumstances that tend to
H vitiate ab initio the initial grant of permission. Either it is a
SMT. YAMUNA v. ANAND SWARUP [MISRA, J.] 723

mechancial grant of permission or it is procured by fraud
practised by the landlord or it is. the result of collusion A
between two unequals but in each case there is no reason
for the tenant to wait till the landlord makes his application
for recovery of possession after the expiry of the fixed
period under section 21 but there is every reason why the
tenant should make an immediate approach to the Rent B
Controller to have his pleas adjudicated by him as soon as
facts and circumstances giving rise to such pleas come to his
knowledge or are discovered by him with the diligence. The
special procedure provided for the benefit of the landlord
in section 21 warrants such immediate approach on the part
of the tenant."
c
What followed thereafter perhaps is more in the nature of an
J obiter than a part of the decision proper, namely:

"Of course if the tenant alliunde comes to know about
landlord's application for recovery of possession and puts D
forth his plea of fraud or collusion etc. at that stage the
Rent Controller would inquire into such plea but he may
run the risk of getting it rejected as an afterthought."

It may be pointed out that in Vohra's case the objections on the
ground of fraud and collusion were raised after the claim by the land- E
lord for being put in possession but were rejected as belated. The
question that came for consideration before the three-Judge Bench
was whether notice was necessary when the landlord applied to be put
in possession after the termination of the tenancy. In that context, the
observation that tenant's objections could be enquired into if the
tenant aliunde came to know of the landlord's move and objected was F
not relevant for the decision.

There are certain observations in Jnder Mohan Lal v. Ramesh
Khanna, [ 1987] 4 SCC 1 which are relevant:

"An analysis of this judgment (Noronah's case) which has G
been applied in the various cases would indicate that
section 21 only gives sanction if the landlord makes a state-
ment to the satisfaction of the court and the tenant accepts
that the landlord does not require the premises for a
limited period; this statement of the landlord must be bona
fide. The purpose must be residence. There must not be H
724 SUPREME COURT REPORTS [ 1990] 1 S.C.R.

any fraud or collusion. There is a presumption of regula-
A
rity. But it is open in particular facts and circumstances of
the case to prove to the satisfaction of the executing court
that there was no collusion or conspiracy between the land-
lord and the tenant and the landlord did not mean what he
said or that it was a fraud or that the tenant agreed because
the tenant was wholly unequal to the landlord. In the
instant case none of these conditions were fulfilled. There
is no evidence in this case that when the landlord stated
that he did not require the premises in question for a
particular period, he did not mean what he stated or that he
made a false statement. There was no evidence in this case
at any stage that the tenant did not understand what the
c landlord was stating or that he did not accept what the
landlord stated. There was no evidence that either the
tenant was in collusion or perpetrating any fraud with the
landlord or the tenant was unequal to the landlord in bar-
gaining powers. It is manifest that there is no evidence to
D show that the Controller did not apply his mind. If that is so
then on the principle enunciated by this Court in Noronah's
case, this sanction cannot be challenged. It is not necessary
to state under section 21 the reasons why the landlord did
not require the premises in question for any particular
period. Nor is there any presumption that in all cases the
tenants are the weaker sections. The presumption is, on the
contrary, in favour of sanction, it is he who challenges the
statement and the admission of the landlord or the tenant
who has to establish facts as indicated in Nagindas case."

In paragraph 22 of the judgment Mukharji, J. (as he then was)
F speaking for the Court held out a caution that the residue must be i
understood in its proper perspective. We may point out that the
respondent apart from being highly qualified held the position of a
Deputy Secretary to Government and, therefore, was not a tenant of
the type in Noronah's case. As has been stated in Inder Mohan Lal's
case, the rule in Noronah's case has to be confined to a particular set of
G facts and should not be freely extended so as to take away the effect of
s. 21. Fraud is an allegation which can easily be made but unless the
allegations are clearly pleaded and some evidence, either direct or ,,i...
circumstantial, is available, a charge of fraud would not succeed.

We may refer to another judgment of this Court in the case of
H Shiv Chander Kapoor. v. Amar Bose, JT (1989) 4 SC 471 where the
SMT. YAMUNA v. ANAND SWARUP [MISRA, J.] 725

'> validity of the permission under s. 21 of the Act came up for considcra-
A
1 tion. Noronah's case was also referred to. In paragraph 15 of the
judgment this Court pointed out that there is nothing in this decision
to support the respondent-tenant's contention in that appeal that the
scope of enquiry is wider permitting determination of the landlord's
bona fide need of the premises as if such a ground for eviction specified
. ins. 14 of the Act was required to be proved. Extending the enquiry to B
, that field would indeed be against the express prohibition enacted in
s. 21 of the Act. Referring to Vohra's case, the latest judgment
indicates:

"It is obvious from the decision in J.R. Vohra's case that
the tenant is expected to raise such a plea during currency
of the limited tenancy and on such a plea being raised by
c
the tenant enquiry into it is contemplated. Even though it is
-'-. not expressly said in Vohra's case, it is implicit that on such
an application being made by the tenant requiring ad judi-
. cation by the Controller, it is the Controller's obligation to
issue notice of the same to the landlord and then to make D
the adjudication with opportunity to both sides to prove
their respective contentions.

Both in Vohra's case and in Shiv Chander Kapoor's case though
not arising for determination in either, it has been stated while laying
down the rule that proceeding to challenge limited tenancy has to be E
taken during the currency of the tenancy, an objection filed by the
tenant could be looked into is indeed an obiter. We would like to make
it clear that the rule having been stated to the contrary in Vohra's case,
there was indeed no warrant to indicate the contra situation. Perhaps
to meet the eventuality which might arise in a particular case, neither
r of the two Benches of this Court wanted to close the avenue of enquiry F
' totally, and that is why in both the cases decided by coordinate
Benches the exception has also been indicated. It must be understood
on the authority of the said two decisions and our judgment now that if .
the tenant has objection to raise to the validity of the limited tenancy it
has to be done prior to the lapse of the lease and not as a defence to the
landlord's application for being put into possession. We would like to G
reiterate that even if such an exercise is available that must be taken to
be very limited and made applicable to exceptional situations. Unless
the tenant is able to satisfy the Controller that he had no opportunity
at all to know the facts earlier and had come to be aware of them only
then, should such an objection be entertained.
H
726 SUPREME COURT REPORTS [ 1990] 1 S.C.R.

A On the application of those tests to the present facts we must
hold that the belated objections of the tenant should not have been
entertained and prayer for possession made by the landlady after the
limited tenancy ran out should have been granted.

The appeal is allowed; the decisions of the Controller, Rent
B Control Tribunal and the High Court are reversed and the landlady is
directed to be put into possession of the premises by 31st of March,
1990. The appellant would be entitled to her costs in the proceedings
1
throughout. Hearing fee is assessed at Rs.2,000.

G.N. Appeal allowed.

(
'

)