TMI Blog1991 (12) TMI 271X X X X Extracts X X X X X X X X Extracts X X X X ..... provisions of Section 21. Sri Rajeev Dhavan rightly urged that both the Controller and the Tribunal misdirected themselves in placing the burden on the landlady to prove that the permission obtained by her was genuine. According to him the primary burden was on the tenant to establish that the permission was obtained by playing fraud. Unfortunately, it appears, the authorities assumed fraud and misrepresentation on mere averment in the objection of the tenant and proceeded to record the finding on premise that the landlady was required to prove it. Apart from the procedural error even the finding that the premises were not needed by her after three years is not well founded. Appeal allowed - C.A. 4927 OF 1991 - - - Dated:- 13-12-1991 - D. Thommen And R. Sahai,JJ. ORDER Thommen, J. 1. Leave granted. 2. The scope of Section 21 of the Delhi Rent Control Act, 1958 has been considered by this Court in a number of decisions Shiv Chander Kapoor v. Amar Bose ; Inder Mohan Lal v. Ramesh Khanna ; Subhash Kumar Lata v. R.C. Chhiba and Anr. ; V.S. Rahi and Anr. v. Smt. Ram Chambeli ; J.R. Vohra v. India Export House Pvt. Ltd. and Anr. ; Yamuna Maloo v. Anand Swarup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce the section is attracted. This is an extraordinary power vested in the Controller to restore possession of the premises to the landlord by a quick and summary action. The non obstante clause contained in the section protects the action of the Controller from challenge on any ground postulated in Section 14 of the Act or any other law. This is a wide protection of any action duly taken in terms of the section, but the requirements of the section must be strictly complied with before action is taken under it. 6. The order of the Controller in the circumstances warranted by the section is a self-executing order requiring no further proceeding. It is at once a sanction for the lease and for eviction on expiry of the period of the lease. Neither can the landlord evict the tenant during the period of the lease nor can the tenant remain in possession beyond that period. Parties are bound by their contract, as sanctioned by the Controller, and the provisions of Section 14 are of no avail to either party to circumvent Section 21. Once the period has expired, there is no question of any further notice to the tenant or any other person in occupation of the premises and there is no scope ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... false. Did the landlord honestly believe that what he stated in his application to be a true and fair representation of the facts? There is no fraud if what he honestly believed to be true turned out to be false. The section does not place any higher degree of responsibility on the landlord. 9. The section requires that the premises have to be let out solely for the purpose of residence for the period agreed to in writing. If the agreement does not so stipulate, the section is not attracted, and the Controller cannot sanction the lease in terms of the section. No non-residential premises can come within the protection of the section. On the other hand, if the premises let out as a residence in terms of the section is deliberately used by the tenant for nonresidential purposes, he loses the protection of the statute for the period of the lease and the Controller can, on an application by the landlord, evict the tenant, or any other person in occupation, and restore possession of the premises to the landlord forthwith. The section protects the landlord and the tenant strictly in terms thereof, and on the fraud or deliberate breach by either party of the terms of the lease as cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by conducting a roving enquiry and by placing the burden wrongly on her to prove that she did not act dishonestly. 12. I agree that the statutory authorities in the present proceedings addressed themselves to the wrong questions, misunderstood the guiding principle of burden of proof, misconstrued the requirements of the section, and reached a totally irrational, unreasonable and unsustainable conclusion that the original order of the Controller was obtained by fraud. There was no justification on the part of the authorities for coming to that conclusion on the basis of a belated plea and far from satisfactory or reliable evidence. The High Court was wrong in affirming the totally unsustainable conclusion reached by the authorities. 13. In the circumstances, I respectfully agree with the findings reached by my learned brother Sahai, J. R.M. Sahai, J. 14. Economically equally matched tenant, resisted execution, successfully, under Section 21 of Delhi Rent Control Act, (in short the Act) by accusing landlady of fraud, misrepresentation and lies thus giving rise to a very important issue in this landlady's appeal as to the nature and extent of fraud which could vitiat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he permission of the controller in the prescribed manner, lets the whole of the premises or part thereof as a residence for such period as may be agreed to in writing between the landlord and the tenant and the tenant does not, on the expiry of the said period, vacate such premises, then, notwithstanding anything contained in Section 14 or in any other law, the Controller may, on an application made to him in this behalf by the landlord within such time as may be prescribed, place the landlord in vacant possession of the premises or part thereof by evicting the tenant and every other person who may be in occupation of such premises. What strikes one is, the simplicity of the language and oneness of purpose. As observed in Noronah (supra) the Parliament was keen on maximising accommodation available for letting, due to scarcity crisis. The objective was sought to be achieved by simplifying the provision for letting and assuring possession after expiry of lease. The only condition for applicability of the Section is no requirement of it by the landlord for short period. It is not subjected to any restriction by requiring the landlord to disclose any reason nor whether it shall be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 's case AIR 1985 SC 475, this Court laid down that a tenant who assails the permission was procured by fraud a ground not dissimilar to the one urged in the present case must approach the Rent Controller during the currency of the limited tenancy for an adjudication of his pleas as soon as he discovers facts and circumstances which, according to him, vitiate the permission. Thus a tenant cannot wait for the entire period of lease and then raise objection to execution on fraud or collusion unless he is able to establish that it was not known to him and he came to know of it, for the first time only at the time of execution. In other words the Controller shall not be justified in entertaining an objection in execution unless the tenant establishes, affirmatively, that he was not aware of fraud before expiry of the period of lease. To the following extent, therefore, the law on procedural aspect should be taken as settled. (1) Any objection to the validity of sanction should be raised prior to expiry of the lease. (2) The objection should be made immediately on becoming aware of fraud, collusion etc. (3) A tenant may be permitted to raise objection after expiry of lease i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s thoughtless or without any care or caution. In law it is passing of an order without any regard to the provision of law. If the section requires the authority to pass an order on inquiry or on being satisfied of existence or non-existence of a fact then the duty cast is higher and an order which is passed without due regard to duty to investigate then the order may be mindless. But in absence of any statutory requirement it may utmost be regulatory oversight. In the context of Section 21 it is clear that there is no statutory requirement for the Controller to enter into enquiry on application made by a landlord supported by a statement and agreed to by the tenant. Even though in Noronah's case it was said that an application to be beyond suspicion must contain special reasons but in subsequent decisions this has been explained and it has been held that in absence of any requirement in the Section to disclose any reason an application filed without reason could not be said to be bad in law nor a permission granted on it could be said to be mechanical or mindless. An order may be mindless if at the time of granting permission there is material to indicate that the premises were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a fide need, provided for in Section 14, as beyond scope of the enquiry under Section 21 of the Act. It was held that the invalidity which could vitiate sanction was error in jurisdictional fact at the time of grant of permission, as valid sanction was sine qua non for Controller's jurisdiction. What, then, is an error in respect of jurisdictional fact? A jurisdictional fact is one on existence or non-existence of which depends assumption or refusal to assume jurisdiction by a Court, tribunal or an authority. In Black's Legal Dictionary it is explained as a fact which must exist before a court can properly assume jurisdiction of a particular case. Mistake of fact in relation to jurisdiction is an error of jurisdictional fact. No statutory authority or tribunal can assume jurisdiction in respect of subject matter which the statute does not confer on it and if by deciding erroneously the fact on which jurisdiction depends the court or tribunal exercises the jurisdiction then the order is vitiated. Error of jurisdictional fact renders the order ultra vires and Wade Administrative Law; bad. In Raza Textiles Raza Textile v. Income Tax Officer, Rampur it was held that a court or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me in any proceeding. A permission granted under Section 21 once permitted to attain finality becomes unassailable on error in exercise of jurisdiction. It could be challenged later or in execution only if it could be brought in the category of a void or ultra vires permission. Such invalidity can arise if jurisdiction is exercised by misrepresentation of facts either about existence of vacancy or nature of premises. In other words what attains finality in accordance with law cannot be permitted to be reagitated or reopened except in the larger social interest of preventing a person from practising deceit. Therefore an error of jurisdictional fact which could entitle a Controller to re-examine the matter in the context of Section 21 is the same, namely, fraud or collusion. Ratio in Noronah (supra) to this extent was reiterated and accepted as correct exposition of law in Shiv Chand Kapoor (supra). It has to be understood as such. 20. Fraud and collusion vitiate even the most solemn proceedings in any civilised system of jurisprudence. It is a concept descriptive of human conduct. Michael Levi likens a fraudster to Milton's sorcerer, Comus, who exulted in his ability to, ' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rved that fraud in relation to statute must be a colourable transaction to evade the provisions of a statute. 'If a statute has been passed for some one particular purpose, a court of law will not countenance any attempt which may be made to extend the operation of the Act to something else which is quite foreign to its object and beyond its scope Craies on Statute Law, 7th Edition, p. 79.' Present day concept of fraud on statute has veered round abuse of power or malafide exercise of power. It may arise due to overstepping the limits of power or defeating the provision of statute by adopting subterfuge or the power may be exercised for extraneous or irrelevant considerations. The colour of fraud in public law or administrative law, as it is developing, is assuming different shade. It arises from a deception committed by disclosure of incorrect facts knowingly and deliberately to invoke exercise of power and procure an order from an authority or tribunal. It must result in exercise of jurisdiction which otherwise would not have been exercised. That is misrepresentation must be in relation to the conditions provided in a section on existence or non-existence of which power c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ma facie to the satisfaction of Controller before landlord is called upon to file reply or enter into evidence. (4) No fishing or roving inquiry should be permitted at the stage of execution. (5) A permission does not suffer from any of these errors merely because no reason was disclosed in the application at the time of creation of short term tenancy. (6) Availability of sufficient accommodation either at the time of grant of permission or at the stage of execution is not a relevant factor for deciding validity of permission. 23. Turning to the facts now, is the sanction granted under Section 21 vitiated because the landlady in obtaining the permission committed fraud? On 3rd November 1978 the landlady filed an application before the Controller under Section 21 the material allegations of which were that the ground floor of the house was lying vacant and she desired to give it on rent for a short period of three years whereafter she needed the house for herself. It was mentioned that the premises were being given for residential purpose only and a proposed lease agreement between her and the tenant along with the plan was attached with the application. Her statement wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raud as the landlady knew from the very beginning that premises were available for letting out indefinitely. The Controller found that in absence of any averment in the objection that she had let out the premises in 1978 for three years as she would require it after expiry of this period for her younger son her statement in support of it could not be looked into. The authority further found that variance between pleading and proof, apart, the landlady failed to establish that premises were let out with intention to get it back after three years for her second son. Inference was drawn against her due to non-production of the son who could have been the best person to throw light on it as later on he not only joined another service but purchased a flat in Bombay. It was held that even if it was assumed that the premises were not needed by her for son that could not validate the sanction. The Appellate Authority agreed with the finding of the Controller as there was no statement in the application, made at the time for grant of permission, that the premises shall be required after three years by her son. In other words since she stated that she required the premises for herself after ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her statement before Controller, stated that she informed the partner who had taken the premises that she shall need it after three years for her second son. And yet the tenant instead of producing that partner, without any excuse, chose to examine another partner and the authorities did not attach any weight to it 25. Letting under Section 21 is not hedged with any restriction. Throwing the whole or part of the premises by landlord for letting out is not linked with his existing accommodation, its number or sufficiency. The one is not dependent on the other. Even letting for paying instalment of loan, for constructing the premises or its re-letting has not been held to be contrary to Section 21. Validity of permission has to be judged on the date of grant of application. Availability of premises for indefinite letting cannot be judged by subsequent events or the failure of the landlord to occupy immediately for personal, financial, economic or other reasons. Therefore, the authorities committed manifest of error of law, both in entertaining the application of the tenant resisting the objection of the landlady by placing the burden on her erroneously and deciding against her by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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