Mrs. Dossibai N. B. Jeejeebhoy v. Khemchand Gorumal and Others

Judgment

Se;ttmbtr 29. ()28 (1962) !\IRS. DOSSIBAI N. B. JEEJEEBHOY KHEMCHAND GORUMAL AND OTHEl\S ( K. N. 'VAKCHOO, K. C. DAS GUPTA and J. c. SIIAJI, JJ.) lea .. -Open land for co11stn1ction of reBidential and busine& building-Letting, if for residfnce or business-Subuqmnt letting of b!<ilding in absence of a contract pumitting 81lb-letti>1gl,'jJect-Bombay Rent•, l!otel and Lodging l/ou"e Rates Control, Act, 1947 (Born. 57 of 1947), as. 6, 15, 25, 28-Part II, Sch. J. The appellant took lease of an open laH<l for construction of Luildings suitable for residential, business, industrial or office purposes. The appellant brought rnits in the City Civil court, Bombay, for the recovery of arrears of rent in respect of premises built on the sai<l open land, all within the city of Bombay thus in the area specified in Schedule I of the llombay Rents, Hotel an<l Lodging House Rates Control Act, 1947.

The appellant stated in the Plaint itsdf that the Bombay Rent Control Act, I 947, did not apply to the demised premises. The defendants pleaded that the Rent Act applied and the City Ci"il Court had no juri•diction to try the suit. The trial Ju<lge held that part II of the Rent Act applied to the premises and consequently only the special courts specified in s. 28 of the Rent Act had jurisdiction to en terrain the suit and ordered the plaints in the suits to be returned to the plaintiff for presentation to the proper court. The ll<imbay High Court summarily dismissed the appeals from the said orders. The point at issue for decision \\·as 'vhcthcr "'vhen a lessee takes lease of open land for the purpose of constructing on it buildings intended to be used for residt::ncc or for business, this amounts to "letting for residence" or "letting for busi· ness".

The appellants contention was that as open land not intended to be used, as it is, for residence or husiness but for construction of buildings for residence or business \Vas taken on lease the land was not being let for re.idence or business. J/F:lcl, that the v-·ords "let for residence, education, business or storage" in s.G of the fiomhay Rents, Hotel and Lodging House Rates Control Act, 1947, are wide enough to include a letting for the achievrncnt of these: purposes by con· struction of buildings as also ,,·ithout construction of buildings. l!eld, further, that on the facts of the present case, in <".ach of these ca"-es, the lease \vas taken \Vith a view to const· ruct buildings thereon for residet1tial, business, industrial or offi~e purpO&CI and the land let was therefore 'premises' to which under s. 6(1) of the Bombay Rent Act, the provisions of Part II of the Act applied. Vinayak Gopal v Laxman ]{ashinaih I. L. R. (1956) Bom. 82 7, approved. CIVIL APPELLATE JURISDICTION:

Civil Appeals Nos. 503 to 506 of 1958. Appeals by special leave from the judgment and orders dated August 4, 1957, of the Bombay High Court in Letters patent Appeals Nos. 29 to 3:! of 1957. J. C. Bhatt, R. P. Bhatt, R. A. Gagrat and G. Gopalakrishnan, for the appellants. N. C. Chatterjee, Madhowdas C. Bhagat and Radhey Lal Agarwal, for the respondents in C. A. No. 503 of 58. JJfadhowdas C. Bhagat and Radh"Y Lal Agarwol, for the respondents in C. As. Nos. 504 to 506 of 1958. 1961. September 29. Tho Judgment of the Court was delivered by DAS GUPTA, J.-When a lessee takes lease of open land for the purpose of constructing on it buildings intended to be used for residence or for business is this "letting for residence", or "letting for business"? That is the short question which arises for decision in these four appeals.

The appellant brought these fJur suits in the City Civil Courts, Bombay, for recovery of arrears of rent in respect of the premises mentioned in the pbint of these several suits. It is clear under the law that the City Civil Court, Bombay, would have no jurisdiction to try these suits if the provisions of Part II of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 (Born. 57 of 1947), which later in this judgment we shall refer to as the "Rent Act", applied to the permises in suits. For this reason the plaintiff stated in the plaint itself that this Rent Act did not apply to the demised premises. The defendant in each case pleaded on Mrs. Dossiiai N. B. Je(jeellwy Khnnclumd Gorumd Das Gupt• J. 19il Mrs . DoJsiiai J\'. B. Jttittjhay h/itntcfuvuf (JOfW!la/ Das Gupta J, U30 SlJPREME COURT REPORTS [1962) the contrary that the Hont Act applied and so the City Cid! Court had no juri8diction to try the suits.

The first is>uo framed in each of these suits then,forC' was, whether the Court had jurisdiction to entertain the suit.. TJ1e learned Judge held that Part II of the l{cnt Act applied to the premises in each of theso suits and con8e'}tl<'ntly only tho special courts fipccified in s. 28 of tt10 Rent Act had jurisdi· ction to eutortain the suits and tho Citv Civil Court had no jurisdiction. Accordingly, he. ordered the plaint in each of the four suits to Le returned to the phintiff for presentation to the proper Court. Tho plaintiff appealed to the High Court ofBomLay but all the four appeals were 8Ummal'ily dismissed. The Let tors Patent appeals preferred by the plaintiff from the decision of the Single .Judge were also dismissed ~ummarily. These appeals have Leen pre· fcrrecl against that decision of the Bombay High Court in Letters Patc11t Appeals on special leave oLtaincd from this Court. l:nder s. 5, sub-s.

8 of tho Hcnt Act unl66B thorn is anything repugnant in the context, "premis· es" mt•ans, among other things, "any land not boing usod for agricultural purposes." It is undisputed in thc8e C<\SCS that the land in rospcd of whieh tho suits were brought was not being used for agricul· turn] purposes and so comc8 within the <lefo1ition of "prcmieos" in s. ii. 'I11e provisions of Part II of tho Act du not howe,·er apply to all premises whieh fall within this definition. Section G with which this Part II opens providos in its firnt sub-sectiou that this part shall apply to pr<'mises let for residence, education, Lusiurns, trade or storage in areas sp<,cificd in Sch. I. It is rnbjcct to a proviso that tho State Government may direct that in any of the ;aid nreas, this Part shall cease to apply to premists let for any of the said purposes, with a further proviso that the State Govornment may again direct that in any of tho said nroas this Part shall re-apply to premisos lot for such of the aforesaid purposes.

As there has been no notification under these provisos affecting the premises in suit, we are not concerned with them; nor are we concerned with sub·s. l(A) under whioh the State Government may direct that this Part shall apply to premises let for any other purposes. The four premises in respect of which the four suits were brought are all within the city of Bombay and thus in the area specified in Schedule I of the Act. In each of these caHes we have therefore to examine the purpose of the lease and to decide whether it was let for residence or for education, busineAs, trade or storage. The lease mentions that. the leasee will construct buildings suitable for residential, business, industrinl or office purposes. The plnintiff's case is that as open land is not intended to be used as it is for residence or business but for construction of buildings for residence or business the land is not being let for residence or business.

The defendant in each case contends that the letting was for residence or business as that was the ultimate purpose of taking the lease. Mr. Bhatt addressed his arguments to the question whether the letting could be said Jo be for residence and did not separately address us on the question of letting for business as obviously if the land could not be said to be let for residence it could not also be said to be let for business. The extreme propisition which Mr. Bhatt raised first of all on behalf of the appellant is that open land can never be let for residence and so whens. 6 speaks of premises being let for residence, land as defined in sub-s. 8 (a) of s. o is outside tho word "premises". There is, in our opinion, no substance in this contention. It is quite clear that open land as it is can be used for residence and so there is no reason to think that open land was not intended to be included in "premises" when s. 6 speaks of premisee being let for residence. I9BJ Afrs.

Doisihai Jrl:B.Jtijtebhoy Khtmchand Gorumal Das Gupta J. 19/il !'.!rs. DOJsib•i 4V. B. J11jttiM_1 K"""'hnJ Gmm,.I (1962) The more substantial quoation for consideration is whether when open land is being leased not to be used for residence in its condition of open land but to be used for the purpose of residence after constructing buildings thereon, the letting of the open land can reason'!.bly be called to be letting for residence. Mr. Bhatteontends that as, what is to be ronsidered is whether the letting of the open land is for residence the land cannot be said to be for residence if not the open land, but, something constrnetcd on the open land is to be used for residence. In such~ case, says l\fr. Bhatt, the land is let for construction of a. building and not for residence. We arc unable to accept this argument. Land can be used fur many purposes.

It may be used for agriculture; for residence of human beings; fur keeping cattle or other animals; for holding meetings; for carrying on busineBS or trade; for storage of goods; for supply of water by excavating tanks, and many other purposes. )fony of these purposes can be achieved on tho open land without tho construction of any buildings. But many of thorn can be better achieved if some kind of structure is created on tlte open land. It scorns reasonable to us to think that when tho Bombay Legislature took particular care to include open land not being used for agricultural purposes within the word "premises" and then wont on in tho very next section to speak of premises being let for several specified purposC3, it was thinking of the purposes to which the land will be uaed irrespective of whether the purpose was intended to be arhioved with or without oonstructbn of a structure.

Tho intention in mentioning only some purposes, viz., rosidPnce, edu · cation, business, trade or storago in s. 6 was to exclude land let for purposes like, keeping of cattle, (except in the way of business or trade), and numerous othor purposes to 1vhich the land may be put from the benefit of part II of the Act. It seems to us that when people speak ordinarily of land being let for busin•lBB, they a.re only 1 · thinking that the ultimate purpose behind the lettinir is that business will be carried on and they are not thinking whether the business will be carried on on the land in its present state or by the construction of temporary sheds or by putting up permanent buildings. Similarly, when a man says that he will take lease of a. plot of land for storage of his goods, what he has in mind is tha.t by taking lease of the Ja.nd he will achieve the object of storing goodR, irrespective of whether for such storage he will have to put up a structure or not.

In the same way, we think, that when land has been let for the purpose of constructing buildings for residence, people will say that it is being let for residence, just as they will say that the land ha.s been let for residence if the lessee intends to use it as caravan site so that the people may live on the open land in ~aravans. In our opinion, the words "let for residence, education, business, trade or storage" are wide enough to include a letting for the achievement of these purposes with construction of buildings as also without construction of buildings. But, says Mr. Bhatt, look at sub-s. (i) of s. 15 of tbe Rent Act which is in this very part II and that will show that the Legislature _ could not have intended !<ind which is let for the construction of buildings for residence to be within the phrase "premises let for residence".

Section 15 of the Act after its amendment by Bombay Act 49 of 1959 reads thus:- "Notwithstanding anything contained in any law, but subject to any contract to the contrary, it shall not be lawful, after the coming into operation of this Act for any tenant to sublet the whole or any part of the premises let to him or to assign or transfer in any other manner his interest therein." It may he mentioned that as the section originally stood the words "but subject to any contract to the contrary" were not there. When the amending Act Mrs. Dossibai N. B. Jetjeebh,y Khemchand Gorumal Das Gvp1a ]. JHJ Mrs. D8S.liiai "V. B. Jujuhhoy Kntmcluwi c.,umal Da10~ra J, (1962] of I 959 introduced thes~ words the amendment further provided that these words shall be deemed always to have been there. Even nJter tho amendment, it remains unlawful, where there is no contract to the contrary, for any tenant of premises to sublet the whofo or any part thereof. Mr. Bhatt's an;ument is that in every case where therois nosueh contract to the contrary the difficulty that will rosult if land let for construction of residential buildings be h"

Id to ho premises lot for rcsi<lonee within tlrn meaning of s. 6. is that after the building is constructed the lessee will not be able to sublet the building or any portion of it; so that in many cases w hero the real purpose of taking the land is for the construction of building for letting out the snmP, that purpoRe will be defeated. This argument ru; regards the difficulty in the matt-0r of letting out the building eonstructcd on the land on which leas<> has been taken was more plausible when tho saving phrase "bul subject to any contract to the contrary" did not form part of the section. Now, however, the eases in which such difficulty will arise. if at all, would be few and far between; for, it. is rea.sonablo to expect that when taking lease of land for the construction of building intended to be let ont to others for residence, the lessee of the In.nd would take caro to inclutlf." in the contract of Jea~e a term pennitting him to let out the buil<ling.

Assuming that tl1oro mn..v be cases where the contract of leaRe does not contain any such term and &SSuminµ- further that it will not be lawful f•>r the leBSeo of the land to let out the building constructed bv him, the prob~bility of such difficultv in some. oases, can bo no reason to cut down the 'ordinary and reasonable connotation of the worcls "let for residence" in s. 6. It is unneces.~ary for us to decide whether if there is no contract to the contrary, s. lo will really stand in tho way of a lcsReo. of tho land letting out buildings constructed by !~1~ on such !a~d. ~Ve may 11ay howcvN that there ism our opm10n r much force in the argument which found favour with the Bombay High Court in Vinayak Gopal, v. Laxman Kashinath (1), where the very question, which is now before us arose for deoision, that the bar of s. 15 will operate only in the way of letting out the land of which lea1e has been taken, but will not stand in the way of letting the building constructed on the land:

In that case the Bombay High Court held that where land is leased for the purpose of construction of buildings for residence the land is "let for residence" within the meaning of s. 6 of the Rent Act. Mr. Bhatt devoted a considerable part of his argument to persmtde us that some of the reasons given in that judgment do not stand scrutiny. We think it unnecessary however to examine whether all the reasons given in the judgment are correct. For, aR already indicated, the words "let for residence" on a proper construction would cover the case of open land being let for construction of residential buildings and so the conclusion reached by the Bombay High Court in Vinavak Gopal's Case(') is, in our opinion, correct.

It is unnecessary for us also to consider for the purpose of the present appeals as to what may happen to the sub-lessee if and when on the terms of a particular l~ase the building ultimately vests in the owner of the land nor as to what may happen if and when on the terms of a particular lease the lessee who has constructed the building gets the right to remove the building. These considerations should not, in our opinion, affect the construction of the words "let for residence". Turning now to tho facts of the present case we find that in eaoh of these cases the lease w!ls taken with a view to construct buildings thereon for residential, business, industrial or office purposes. The premi~es let are therefore "promises" to which (1)1: L. R. [ 1956) Born. 827. Mrs. Dossiba.i N. B. Jeejtehhsy Khemcharid Gorumal Daa Gupta J, JI rs. Dossibai X. B. Juj11blw.J Khl1TKl&and GorU111Ql Das Gupta J. Septnnbtr 29. [1962) under s. 6 (1) of tho Rent Act the provision of part II of the Act, apply.

The Trial Court nnd the High Court wer• therefore right in holding that the City Civil Court, Bombay, had 'no jurisdiction to try the suitll. Tho a ppeale arc accordin~ly dismil!&'cl with costs. Thero will be one 1et of hearing fee for th• four appeals. Ap~nl di.<miased. MANNALAL JAIN TIIF. RTATF. OF ASSAM A?-.J) OTHERS. (R. T'. 81NRA, c. J., R. K. DAS, A. TC SARIU.R, N. RA.JAGOPALA AYYANGAR nnd .T. R. MUDl!OLKAR, .T.T.) Foo,/ Cnntro/-T.ire•r• '°' U"ho/,.alt dealing in rir• anii padd.:1-l.icm'1°flfl Orda pre10-ibing co"'1itinna Jnr g,ant of licP111:R--Stal1, r'r0t"rnml'nt ia~uing inatructionR lo lictnaing auf.1,oritif'8 to qranf licenceJ to co·oP'rative ~ocielit1 01ily-Propriety of---Grant of licl'nttt to ro-operative .!Dcittit11 and rtfttaal (() othm-1.egalilf/ ~f-E,.ential Commodili'6 .A<I, 1955, (IO of 195.5), "· 3 mul 6-·-A•ROm FoodgraiM (Lir.<n•;ng and Co11trol) nrd<r, IP61, cl. 5. In exercise of the powers ronf<rred by s.

3 of the Ew.ntial O>mmodities Ar.t, 1955, the Assam Government made the A"am Foo<lizrains (Licensing anrl Control) Order, 1961. This Order providt"d that no person could do bu~ine~s in foodgrains including ric.- and parlrly, in \\•holcsal~ quantities except under a licenc' i"ued thereunder. Clause 5 of the Order laid down in suh-ds. (a) to (e) matters which the licensin<r authority !l}•all, among otht'r matters, have rejrard to in granting or refusing license; sub-cl. (e) bring "whether the applicant is a co-operative society". In 1959, directions had he.n issued to aU liccnsing authoritieo by the Government that the rights of monopoly procurement had been given to Apex Co-operative Society. The petitioner applied for a licence but was ref115'd in view of the provisions of sub-cl. (e) of cl. 5 of the Order. The petitioner challenged the order refusing the licence on the grounds: (1) that sub-clause :el wu u/trg viua r