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Subhash Kumar Lata Versus R.C. Chhiba & Another

Civil Appeal Nos. 1594- 1595 0f 1986 - Dated:- 23-9-1988 - NATRAJAN, S. AND PATHAK, R.S. JJ. Avadh Behari Rohtagi, M.S. Maan and B.S. Maan for the Appellant. Harish N. Salve, S.K. Mehta, Vijay Makhija, R. Jaganath Goulay, S.A. Sarin and Aman Vachhar, for the Respondents. JUDGMENT: The Judgment of the Court was delivered by NATARAJAN, J. Both the appeals by special leave have been filed by the same appellant and are directed against a common judgment delivered by the High Court of Delhi in two co .....

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he Rent Control Tribunal in the Second Appeals preferred by the respondents a dismissed the Execution Applications. The aggrieved appellant has preferred these appeals. It was the appellant's case that she had obtained the sanction of the Additional Rent Controller, New Delhi on 26/27.2.76 and there-after leased out specified portions in her property bearing no. N-57, Panchseel Park, New Delhi to the respondents under separate leases of a limited period of two years commencing from 1.3.76. A .....

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leased out to them. On the ground the two respondents failed to vacate the portions leased out to them at the end of the two years period, the appellant filed Execution Applications under Section 21 of the Act to seek an order from- the Rent Controller for delivery of possession of the leased portions: The common defence put forth by the two respondents was that there was a single tenancy and not two tenancies and they were jointly inducted into possession of the entire leased portion even in th .....

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December 1975 itself, the respondent mislead them by saying that the oral tenancy required formal sanction by the Rent Controller and hence they should appear before the Rent Controller and have their statements recorded by him. It ws only after giving their statements before the Rent Controller they suspected the motives of the appellant and hence they refused to execute lease deeds in the month of March 1976 as desired by the appellant. The Rent Controller. After a detailed consideration of t .....

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the order of sanction of the Rent Controller suffered from an infirmity due to the appellant failing to glove the reasons for her wanting to let out the property for a limited period. We need not however concern ourselves about that aspect of the matter. The Rent Control Tribunal, in the appeals preferred to it, however differed from the Rent Controller and held that even if he respondents had been inducted into possession in December 1975 under an oral tenancy, they must be deemed to have impl .....

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f the Rent Controller on the ground of fraud. In accordance with its conclusions, the Tribunal allowed the appeals preferred by the appellant and held that the Execution Applications were maintainable and directed the respondents to deliver possession to the appellant of the leased portions in a month's time. It was then the turn of the respondents file second appeals to the High Court against the order of the Rent Control Tribunal. The High Court allowed the appeals holding that since the r .....

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e for any surrender of a pre-existing lease. Consequently the High Court allowed the second appeals and restored the order of the Rent Controller dismissing the Execution Applications. Mr. Rohtagi, learned counsel for the appellant formulated his propositions as under to contend that the High Court had erred in allowing the appeals and dismissing the Execution Applications: 1. The sanction given by the Rent Controller on 26/27.2.76 to the appellant permitting her to grant limited tenancy rights .....

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ng from 1.3.1976. (3) In any event the respondents are dis-entitled under law to set up a plea of fraud to seek nullification of the PG NO 247 sanction granted by the Rent Controller because the respondents had not only failed to bring forthwith to the notice of the Rent Controller the fraud committed by the appellant but on the other hand they had availed of the benefit of the permission given by the Rent Controller for the full period of two years and thereby they had lost their power of avoid .....

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n if it were to be held that the respondents had already been inducted into possession of the leased premises on an oral tenancy in the month of December 1975 itself, they must be deemed to have impliedly surrendered their tenancy rights under the oral lease when they agreed to accept the limited tenancy rights given to them in pursuance of the sanction of the Rent Controller. Before we examine the contentions of Mr. Rohtagi, we may appositely advert to certain facts emerging from the evidence a .....

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nowledged the payment under two receipts but both the receipts have been typed on the same paper. The receipts would read as if a sum of ₹ 850 had been received separately from each one of them but the recital is of no consequence because the respondents have paid the appellant a sum of ₹ 5,100 by means of a single cheque towards advance rent for a period of three months at the rate of ₹ 1,7)0 per month. The appellant has tried to explain away the payment by saying that the pay .....

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ble that irrespective of the difference in the size and nature of the two portions the respondents would have consented to pay the same rate of rent to the appellant for the portions alleged to have been leased out to them. It is also worthy of note that the tenancies said to have been granted to the two respondents are for the same period, i.e. from 1.3.76 to 28.2.78. If all these factors are taken note of, the only conclusion that can be reached is that only a single tenancy in favour of both .....

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t did not require the use of the leased premises for a period of two years commencing from 1.3.76 and that the respondents were willing to take the respective portions marked in the plan Ex. A- I produced by the appellant for a limited period but even so the question would arise whether the order passed by the Rent Controller can be deemed a valid and legal sanction given under Section 21. The answer has to be clearly in the negative because the appellant had already let out the premises to the .....

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the landlord must obtain the permission of the Controller in the prescribed manner. Thirdly, letting of the whole or part of the premises must be for residence. Fourthly, such letting out must be for such period as may be agreed in writing." PG NO 249 Applying the above tests, it may be seen that in this case the very first condition has not been fulfilled. When the appellant had already parted with her possession of the leased portions by inducting the respondents into possession in Decemb .....

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accommodation by non- owners of houses on the one hand and the reluctance of the owners of houses due to genuine apprehension entertained by them on the other in letting out their houses in whole or in part even when they were not in need of the house or portion of it lest the tenants should set up statutory tenancy rights and refuse to vacate the premises at the end of the lease period. What the Section envisages is the creation of tenancy rights after getting the sanction of the Rent Controll .....

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nded to obtain post-facto sanction of a tenancy that had already been created by suppressing relevant information from the Rent Controller so as to enable the landlord to straightaway recover possession of the leased property by filling an application under Section 2l of the Act after the expiry of the period for which permission to lease had been granted by the Rent Controller. Such being the case when the appellant had already put the respondents in possession of the property in December 1975 .....

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of the situation or cure the lacuna of withholding of relevant information from the Rent PG NO 250 Controller. We cannot therefore accept the contention of the appellant's counsel that the order passed by the Rent Controller on 26/27.2.76 granting sanction to the appellant to confer limited tenancy rights on the respondents did not suffer from any defect or infirmity. As regards the next contention of Mr. Rohtagi that the appellant had not committed any fraud when she sought for and obtaine .....

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ressed relevant materials from the notice of the Rent Controller and had thereby obtained an order of sanction from the Rent Controller to lease out the property for a period of two years from 1.3.1976. There is no denying the fact that the appellant had failed to disclose to the Rent Controller that she had already inducted the respondents into possession and inspite of it she was seeking permission under Section 21 in order to restrict the tenancy rights of the respondents to a period of two y .....

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ole or in part for a limited period to a tenant even if the tenant had already been inducted into possession but such sanction has to be obtained after a full an-i frank disclosure of all factors including the circumstances under which the tenant had been put in possession even before the Rent Controller's sanction was obtained and before an agreement in writing was entered into between the parties in terms of the sanction. It could be that the tenant may have been in urgent need of the prem .....

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had also appeared before the Rent Controller and agreed to take the property on lease for a limited period of two years without demur cannot obliterate or nullify the fraud committed on the statute. This position has been succinctly pointed out in S.B. Noronah v. Prema Kumari, (supra) at page 287 in the following words: The fact that a landlord and a potential tenant together apply, setting out the formal ingredients of Section 21, does not relieve the Controller from being vigilant to inquire a .....

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ter should be viewed. Forgetting this position, Mr. Rohtagi based his arguments on the footing that what has been held against the appellant was her perpetration of a fraud on the respondents and the respondents being the sufferers thereby. It was proceeding on those lines Mr. Rohtagi argued that the respondents were not illiterate but highly educated persons, that they were fully aware of the nature of the transaction and that they had willingly consented to the creation of limited tenancy righ .....

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d the truth from the Rent Controller and induced him to give his sanction under Section 21 so as to restrict the tenancy rights already conferred upon the respondents to a period of two years and to enable the appellant to initiate execution proceedings straightaway against the respondents at the expiry of the lease period and have them evicted through process of court from the leased premises. What is now left is the further contention of the appellant's counsel regarding the failure of the .....

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