Gian Devi Anand Vs Jeevan Kumar and Ors 01051985 s850381COM762482

MANU/SC/0381/1985
Equivalent Citation: AIR1985SC 796, 1985(87)BOMLR316, 1985(1)RC R(Rent)459, 1985(1)SC ALE724, (1985)2SC C 683, [1985]Supp1SC R1
IN THE SUPREME COURT OF INDIA

Civil Appeal No. 3441 of 1972
Decided On: 01.05.1985
Appellants: Gian Devi Anand
Vs.
Respondent: Jeevan Kumar and Ors.
Hon'ble Judges/Coram:
Y.V. Chandrachud, C.J., P.N. Bhagwati, S. Murtaza Fazal Ali, V. Balakrishna Eradi and
A.N. Sen, JJ.
Counsels:
For Appellant/Petitioner/Plaintiff: S.N. Andley, Uma Datta, Tara Chandra Sharma and
K.S. Mohan, Advs
For Respondents/Defendant: Shyamala Pappu, B.B. Sawhney, Indra Sawhney and Kittu
Bansilal, Advs.
Case Note:
Tenancy - Eviction - Section 2(1)(iii) of Delhi Rent Control Act, 1958 - High
Court passed decree for eviction against Appellant on ground that heirs of
statutory tenant did not have any right to remain in possession of tenanted
premises on death of statutory tenant - Hence, this Appeal - Whether,
statutory tenancy of commercial premises was heritable on death of statutory
tenant - Held, Section 2(1)(iii) of Act cleared that Legislature had fit to make
provisions regulating right to inherit tenancy in respect of residential
premises - However, there was no provision of rights of heirs to inherit
tenancy rights of commercial tenanted premises - Though, under ordinary law
of succession, tenancy right was heritable devolves on heirs - Therefore,
tenancy right of statutory tenant did not come to end with his death and this
right devolved to his legal heirs - Hence, judgment of High Court was set
aside and case was remanded to High Court for decision of Appeal - Appeal
allowed.
Ratio Decidendi:
"Tenancy right of statutory tenant does not come to end with his death but it
devolved to his legal heirs."
JUDGMENT
1. I entirely agree with the Judgment just delivered by my learned brother A.N. Sen, J. I
am adding a few words of my own since. I was a party to the decision in Ganpat Ladha
v. Shashikant Vishnu Shinde [1978] 3 S.C.R. 1988 where certain observations were
made which seem to take a different view from the one we are taking in the present
case.
2. The question which arises here for consideration is as to whether statutory tenant is
heritable on the death of the statutory tenant. 'Statutory tenant is not an expression to
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be found in any provision of the Delhi Rent Control Act 1958 or the rent control
legislation of any other State. It is an expression coined by the judges in England and,
like many other concepts in English law, it has been imported into the jurisprudence of
this country and has become an expression of common use to denote a tenant whose
contractual tenancy has been determined but who is continuing in possession of the
premises by virtue of the protection against eviction afforded to him by the rent control
legislation. Though the expression 'statutory tenant' has not been used in any rent
control legislation the concept of statutory tenant finds recognition in almost every rent
control legislation The definition of 'tenant' in Section 2(1) of tie Delhi Rent Control Act
1958-and I am referring here to the provisions of the Delhi Rent Control Act 1958
because that is the statute with which we are concerned in the present case-includes a
statutory tenant. It says in Clause (ii) that 'tenant' includes any person continuing the
possession after the termination of his tenancy'. Such a person would not be a tenant
under the ordinary law but he is recognised as a 'tenant' by the rent control legislation
and is therefore described as a statutory tenant as contra-distinguished from contractual
tenant. The statutory tenant is, by virtue of inclusion in the definition of 'tenant', placed
on the same footing as contractual tenant so far as rent control legislation is concerned.
The rent control legislation in fact, as pointed out by this Court in a seven judge Bench
decision in V. Dhanapal Chettiar v. Yesodai Ammal MANU/SC/0504/1979 :
[1980]2SCR334 does not make any distinction between contractual tenant and statutory
tenant. "It does not permit the landlord to snap his relationship with the tenant merely
by his act of serving a notice to quit on him. Inspite of the notice, the law says that he
continues to be a tenant and he does so enjoying all the rights of a lessee and is at the
same time deemed to be under all the liabilities such as payment of rent etc. in
accordance with the law." The distinction between contractual tenancy and statutory
tenancy is thus completely obliterated by the rent control legislation. Though genetically
the percentage of these two legal concepts is different, one owing its origin to contract
and the other to rent control legislation, they are equated with each other and their
incidents are the same. If a contractual tenant has an estate or interest in the premises
which is heritable, it is difficult to understand why a statutory tenant should be held not
to have such heritable estate or interest. In one case, the estate or interest is the result
of contract while in the other it is the result of statute. But the quality of the estate or
interest is the same in both cases. The difficulty in recognising that a statutory tenant
can have estate or interest in the premises arises from the fact that throughout the last
century and the first half of the present, almost until recent times, our thinking has
been dominated by two major legal principles, namely, freedom of contract and sanctity
of private property and therefore we are unable to readily accept that legal relationships
can be created by statute despite want of contractual consensus and in derogation of
property rights of the landlord. We are unfortunately not yet reconciled to the idea that
the law is moving forward from contract to status. Why can estate or interest in
property not be created by statute ? When the rent control legislation places a statutory
tenant on the same footing as a contractual tenant, wipes out the distinction between
the two and invests a statutory tenant with the same right, obligations and incidents as
a contractual tenant, why should it be difficult to hold that, just like a contractual
tenant, a statutory tenant also has estate or interest in the premises which can be
inherited. Of course, strong reliance was placed on behalf of the landlord on Section
2(1)(iii) of the Delhi Rent Control Act 1958 to combat this conclusion but that provision
merely limits or circumscribes the nature and extent of the protection that should be
available on the death of a statutory tenant in respect of residential premises. It does
not confer a new right of heritability which did not exist aliunde. My learned brother
A.N. Sen, J. has discussed this aspect of the case in great detail and I find myself
wholly in agreement with what he has said in regard to the true meaning and import of

Section 2(1)(iii).
3 . Now a word about Ganpat Ladha's case (supra). It is true that there are certain
observations in that case which go counter to what we are holding in the present case
and to that extent these observations must be held not to enunciate to correct law on
the subject. This Court was not really concerned in that case with the question of
heritability of statutory tenancy. The only question was in regard to the true
interpretation of Section 5(ii)(c) of the Bombay Rents, Hotel and Lodging House Rates
Control Act 1947 which is almost in same terms as Section 2(1)(iii) of the Delhi Rent
Control Act 1958 and while dealing with this question, the Court made certain
observations regarding the nature of statutory tenancy and its heritability. The attention
of the Court was not focussed on the question whether a statutory tenant has an estate
or interest in the premises which is heritable and no argument was advanced that a
statutory tenancy is heritable. It was assumed that a statutory tenancy is not heritable
and on that footing the case was argued in regard to the true meaning and construction
of Section 5(ii)(c). The observations made in that case to the extent to which they
conflict with the judgment in the present case must therefore be regarded as overruled.
4. I accordingly concur with the order made by my learned brother A.N. Sen, allowing
the appeal and remanding the case to the High Court for disposal according to law.
There will be no order as to costs.
A.N. Sen, J.
5 . The question for consideration in this appeal by special leave is whether under the
Delhi Rent Control Act, 1958 (for the sake of brevity hereinafter referred to as the Act),
the statutory tenancy to use the popular phraseology, in respect of commercial premises
is heritable or not. To state is more precisely, the question is whether the heirs of a
deceased tenant whose contractual tenancy in respect of commercial premises has been
determined, are entitled to the same protection against eviction afforded by the Act to
the tenant.
6. The question is essentially a question of law. This very question has been raised in a
number of appeals, arising out of different sets of facts giving rise, however, to this
common question of law in all the appeals. As the decision on this common question of
law which arises in the other appeals pending in this Court may effect the parties in the
other appeals, we considered it proper to hear the counsel appearing in all the appeals
on this common question of law. We, however, feel that it will be convenient to deal
with the other appeals separately and dispose of the same, applying the decision or this
common question of law in the light of the facts and circumstances of the other cases
and pass appropriate orders and decrees in the other appeals when they are taken up
for disposal.
7. Though the question is mainly one of law, it is necessary for a proper appreciation of
the question involved to set out in brief the facts of the present appeal which is being
disposed of by this judgment.
8 . One Wasti Ram was the tenant in respect of Shop No. 20, New Market, West Patel
Nagar, New Delhi under the respondent at at the monthly rent of Rs. 110. He came into
possession as such tenant on and from 1.9.1959. In April, 1970 the respondent landlord
determined the tenancy by serving a notice to quit on the tenant Wasti Ram, since
deceased. In September, 1970, the respondent landlord filed a petition under Section
14 of the Act for the eviction of the tenant Wasti Ram from the said shop on the
following grounds : -(1) non-payment of rent, (2) bona-fide requirement, (3) change of

user from residential to commercial, (4) substantial damage to property and (5) sub-
letting In the petition filed by the landlord against the tenant Wasti Ram, the landlord
had also impleaded one Ashok Kumar Sethi, as defendant No. 2 alleging him to be the
unlawful sub-tenant of the tenant Wasti Ram. By judgment and order dated 19.5.1975,
the Rent Controller held that (1) the ground of bona fide requirement was not available
to the landlord under the Act in respect of any commercial premises (2) the premises
had been let out for commercial purposes and there had been no change of user, (3) no
substantial damage to property had been done by tenant and (4) Sub-letting had been
established. On the question of non-payment of Rent, the Rent Controller held that the
tenant was liable to pay a sum of Rs. 24 by way of arrears for the period of 1.3.1969 to
28.2.1970 after taking into consideration all payments made and a further sum of Rs.
90 on account of such arrears for the month of September 1970 and the rent sub-
sequent to the month of March, 1975, if not already deposited. In view of the aforesaid
finding on the question of default in payment of rent, the Rent Controller held that the
tenant was liable to eviction under Section 14(1)(a) of the Act and further held that in
view of the provisions contained in Section 15(1) of the Act there would however be no
order or decree for eviction if the tenant deposited all the aforesaid arrears within a
period of one month from the date of the order and in that case the ground of non-
payment of rent would be wiped out. The Rent Controller ordered accordingly.
9 . Against the order of the Rent Controller, the landlord preferred an appeal on 13.7-
1975 and the tenant Wasti Ram filed his cross-objection. The cross-objection of the
tenant was against the order of the Rent Controller regarding his finding on default in
payment of rent. The landlord in his appeal had challenged the finding of the Rent
Controller on the question of substantial damage to the property by the tenant and also
the finding of the Rent Controller on the question of sub-letting. It appears that during
the pendency of the appeal, the tenant Wasti Ram died and on 5.9.1977 the percent
appellant Suit. Gian Devi Anand, the widow of deceased Wasti Ram, was substituted in
place of Wasti Ram on the application of the landlord. The Rent Control Tribunal
allowed the cross-objection of the tenant and held that there was no default on the part
of the tenant in the matter of payment of rent. The Rent Control Tribunal rejected the
first contention of the landlord in the Landlord's Appeal regarding substantial damage
done to the property by the tenant. On the other question, namely, the question of sub-
letting, the Rent Control Tribunal allowed the appeal of the landlord and remanded the
case to the Rent Controller to decide the question of sub-letting after affording an
opportunity to the parties to lead evidence in this regard.
10. Against the order of the Rent Control Tribunal, Smt. Gian Devi Anand, the widow of
the deceased tenant, filed an appeal in the High Court impleading in the said appeal the
other heirs of Wasti Ram as pro-forma respondents. The landlord also filed a cross-
objection in the High Court after the widow had presented the appeal against the order
of the Rent Control Tribunal directing remand on the question of sub-letting. In the
cross-objection filed by the landlord, the landlord had challenged the finding of the
Tribunal on the question of non-payment of rent and had further raised a contention
that view of the death of the original tenant Wasti Ram, who continued to remain in
possession of the shop as a statutory tenant, the widow and the heirs of the deceased
tenant were not entitled to continue to remain in occupation thereof. The High Court
held that on the death of the statutory tenant, the heirs of the statutory tenant had no
right to remain in possession of the premises, as statutory tenancy was not heritable
and the protection afforded to a statutory tenant by the Act is not available to the heirs
and legal representatives of the statutory tenant. In this view of the matter the High
Court did not consider it necessary to go into other questions and the High Court
allowed the cross-objection filed by the landlord and passed a decree for eviction

against the appellant and the other heirs of Wasti Ram, the deceased tenant.
11. The correctness of this view that on the death of a tenant whose tenancy in respect
of any commercial premises has been terminated during this life time, whether before
the commencement of any eviction proceeding against him or during the pendency of
any eviction proceeding against him, the heirs of the deceased tenant do do not enjoy
the protection afforded by the Act to the tenant and they do not have any right to
continue to remain in possession because they do not inherit the tenancy rights of the
deceased tenant, is challenged in this appeal.
12. The learned Counsel for the appellant-tenant argues that there could be no doubt
that a contractual tenancy is heritable and he contends that notwithstanding the
termination of the contractual tenancy of the tenant in respect of any commercial
premises, the position in law remains unchanged in so far as the tenancy in respect of
commercial premises is concerned, the virtue of the provisions of the Act. In support of
this contention reference is made to the provisions of the Act and strong reliance is
placed on the decision of this Court in the case of Damadi Lal and Ors. v. Parashram
and Ors. [1976] Su S.C.R. 245 and also to the decision of this Court in the case of V.
Dhanapal Chettiar v. Yesodai Ammal. [1977] 1 S.C.R. 334.
1 3 . The learned Counsel appearing on behalf of the landlord- respondents have
Submitted that on the determination of the contractual tenancy, the tenancy comes to
an end and the tenant ceases to have any estate or interest in the premises. It is
contended that on determination of the tenancy, the tenant becomes liable to be evicted
in due process of law under the general law of the land; but, the Act affords a
protection to the tenant against such eviction in as the Act provides that inspite of the
termination of the tenancy, no order or decree for procession shall be passed against
the tenant, unless any of the grounds mentioned in the Act which entitles a landlord to
recover possession of the premises from the tenant is established. It is contended that
the protection to the tenant under the Act is against eviction except on grounds
recognised by the Act and the protection is only in the nature of personal protection to
the tenant who continues to remain in possession after the termination of the tenancy.
The contention is that the tenant loses the estate or interest in the tenanted premises
after termination of the contractual tenancy and the tenant by virtue of the Act is
afforded only a personal protection against eviction; and, therefore, the heirs of such
tenant on his death acquire no interest or estate in the premises, because the deceased
tenant had none, and they can also claim no protection against eviction, as the
protection under the Act is personal to the tenant as long as the tenant continues to
remain in possession of the premises after the termination of the tenancy. The
argument, in short, is that the protection against eviction after termination of tenancy
afforded to a tenant by the Act creates a personal right in favour of the tenant who
continues to remain in possession after termination of his tenancy without any estate or
interest in the premises; and, therefore, on the death of such a tenant, his heirs who
have neither any estate nor interest in the tenanted premises and who do not have any
protection under the Act against eviction, are liable to be evicted as a matter of course
under the ordinary Law of the land. In support of this argument various authorities
including decisions of this Court, of various High Courts, of English Courts and also
passages from Halsburys" Laws of England and other eminent English authors have
been cited.
14. It has been further argued that in view of the clear provision in law that heirs of a
deceased tenant whose tenancy had been terminated during his life time and who was
continuing in possession by virtue of the provisions of the Act did not enjoy any

protection and was liable to be evicted as a matter of course, the Legislature considered
it fit to intervene to give some relief to the heirs of the deceased tenant in respect of the
residential premises and amended the Act of 1958 by Delhi Rent Control (Amendment)
Act, 1976 (Act 18 of 1976) by changing the definition of 'tenant' with retrospective
effect. The argument is that by virtue of the amendment introduced in 1976 with
retrospective effect, the heirs of the deceased tenant specified in Section 2(iii) enjoy the
protection against eviction during their life time in the manner mentioned therein,
provided the conditions mentioned therein are satisfied, only with regard to residential
premises. It is contended that with regard to the residential premises such limited
protection essentially personal to the heirs specified and to be enjoyed by them for their
lives in the manner laid down in the said Sub-section 2(1)(iii) has been provided by the
amendment; but in respect of commercial premises no such protection has been given.
15. We do not consider it necessary to refer to the various English cases and the other
English authorities cited from the Bar. The English cases and the other authorities turn
on the provisions of the English Rent Acts. The provisions of the English Rent Acts are
not in pari materia with the provisions of the Act in question or the other Rent Acts
prevailing in other States in India. The English Rent Acts which have come into
existence from time to time were no doubt introduced for the benefit of the tenants. It
may be noted that the term "statutory tenant" which is not to be found in the Act in
question or in the other analogous Rent Acts in force in other States in India, is indeed
a creature of the English Rent Act. English Rent Act. 1977 which was enacted to
consolidate the Rent Act 1968, parts III, IV and VIII of the Housing Finance Act, 1972,
the Rent Act 1974, Sections 7 to 10 of the Housing Rents and Subsidies Act 1975 and
certain related enactments, with amendments to give effect to recommendation of the
Law Commission, speaks of protected tenants and tenancies in Section 1 and defines
statutory tenant in Section 2, English Rent Act, 1977 is in the nature of a complete Code
governing the rights and obligations of the landlord and the tenant and their
relationship in respect of tenancies covered by the Act. As the provisions of the English
Act are materially different from the provisions of the Act in question and other Rent
Control Acts in force in other States in India, the decisions of the English Courts and the
passages from the various authoritative books including the passages from Halsbury
which are all concerned with English Rent Acts are not of any particular assistance in
deciding the question involved in this appeal. As we have already noticed, the term
'statutory tenant' is used in English Rent Act and though this term is not be found in the
Indian Acts, in the Judgments of this Court and also of the various High Courts in India,
this term has often been used to denote a tenant whose contractual tenancy has been
terminated but who has become entitled to continue to remain in possession by virtue
of the protection afforded to him by the statutes in question, namely, the various Rent
Control Acts, prevailing in different States of India. It is also important to note that
notwithstanding the termination of the contractual tenancy by the Landlord, the tenant
is afforded protection against eviction and is permitted to continue to remain in
possession even after the termination of the contractual tenancy by the Act in question
and invariably by all the Rent Acts in force in various States so long as an order or
decree for evictions against the tenant on any of the grounds specified in such Acts on
the basis of which an order or decree for eviction against the tenant can be passed, is
not passed,
16. As various decisions of this Court on which reliance has been placed by the learned
Counsel for the Landlord have been cited, it does not become very necessary to
consider at any length the various decisions of the High Courts on the very same
question, relied on by the Learned Counsel for the landlords. It may, however, be noted
that the decisions of this Court to which we shall refer in due course and the decisions

of the High Courts which were cited by the learned Counsel for the Landlords do lend
support to their contention.
17. We first propose to deal with the decision of his Court in Damadilal's case (supra)
in which this Court considered some of the English Authorities and also some of the
decisions of this Court. In this case the first question raised on behalf of the plaintiff-
appellant in this Court was whether the heirs of the statutory tenants had any heritable
interest in the demised premises and had the right to prosecute the appeal in the High
Court on the death of the statutory tenant.
18. Dealing with this contention the Court held at pages 650 to 654 :
In support of his first contention Mr. Gupta relied on two decisions of this
Court, Anand Nivas (Private) Ltd. v. Anandji Kalyanji Pedhi and Ors. [1973] 4
S.C.R. 892 and Jagdish Chander Chatterjee and Ors. v. Sri Kishan and Anr.
MANU/SC/0616/1972 : [1973]1SCR850 . The statute considered in Anand Nivas
[1973] 4 S.C.R. 892 case was Bombay Rents, Hotel and Lodging Rates Control
Act, 1947 as amended in 1959. The question there was, whether a tenant
whose tenancy had been terminated had any right to sublet the premises. Of
the three learned Judges composing the Bench that heard the appeal,
Hidayatullah and Shah, JJ. held that a statutory tenant, meaning a tenant whose
tenancy has determined but who continues in possession, has no power of
subletting. Sarkar J. delivered a dissenting opinion. Shah J. who spoke for
himself and Hidayatullah J. observed in the course of their judgment:
A statutory tenant has no interest in the premises occupied by him, and
he has no estate to assign or transfer. A statutory tenant is, as we have
already observed, a person who on determination of his contractual
right, is permitted to remain in occupation so long as he observes and
performs the conditions of the tenancy and pays the standard rent and
permitted increases. His personal right of occupation is incapable of
being transferred or assigned, and he having no interest in the property
there is no estate on which subletting may operate.
It appears from the judgment of Shah, J. that 'the Bombay Act merely grants
conditional protection to a statutory tenant and does not invest him with the
right to enforce the benefit of any of the terms and conditions the original
tenancy'. Sarkar, J. dissenting held that word 'tenant' as defined in the Act
included both a contractual tenant-a tenant whose lease is subsisting as also a
statutory tenant and the latter has the same power to sublet as the former.
According to Sarkar, J. even if a statutory tenant had no estate or property in
the demised premises, the Act had undoubtedly created a right in such a tenant
in respect of the property which he could transfer. Jagdish Chander Chatterjee's
case dealt with the Rajasthan Premises (Control of Rent and Eviction) Act,
1950, and the question for decision was whether on the death of a statutory
tenant his heirs succeed to the tenancy so as to claim protection of the Act. In
this case it was held by Grover and Palekar JJ., relying on Anand Nivas's case,
that after the termination of contractual tenancy, a statutory tenant enjoys only
a personal right to continue in possession and on his death his heirs do not
inherit any estate or interest in the original tenancy.
Both these cases, Anand Nivas and Jagdish Chander Chatterjee, proceed on the
basis that a tenant whose tenancy has been terminated, described as statutory

tenant, has no estate or interest in the premises but only a personal right to
remain in occupation. It would seem as if there is a distinct category of tenants
called statutory tenants having separate and fixed incidents of tenancy. The
term 'statutory tenancy' is borrowed from the English Rent Acts. This may be a
convenient expression for referring to a tenant whose tenancy has been
terminated and who would be liable to be evicted but for the protecting statute,
but courts in this country have sometimes borrowed along with the expression
certain notions regarding such tenancy from the decisions of the English Courts.
In our opinion it has to be ascertained how far these notions are reconcilable
with the provisions of the statute under consideration in any particular case.
The expression 'statutory tenancy' was used in England in several judgments
under the Increase of Rent and Mortgage interest (War Restrictions) Act, 1915,
to refer to a tenant protected under that Act, but the term got currency from the
marginal note to Section 15 of the Rent and Mortgage Interest (Restriction) Act,
1920. That section which provided inter alia that a tenant who by virtue of that
Act retained possession of any dwelling house to which the Act applied, so long
as he retained possession, must observe and would be entitled to the benefit of
all the terms and conditions of the original contract of tenancy which were
consistent with the provisions of the Act, carried the description in the margin
'conditions of statutory tenancy'. Since then the term has been used in England
to describe a tenant protected under the subsequent statutes until Section 49(1)
of the Housing Repairs and Rent Act, 1954 for the first time define 'statutory
tenant' and 'statutory tenancy'. 'Statutory Tenant' was defined as a tenant 'who
retains possession by virtue of the Rent Acts and not as being entitled to a
tenancy' and it was added, 'statutory tenancy' shall be construed accordingly.'
This definition of 'statutory tenancy' has been incorporated in the Rent Acts of
1957 and 1965. In England 'statutory tenancy' does not appear to have had any
clear and fixed incidents; the concept was developed over the years from the
provisions of the successive Rent Restrictions Act which did not contain a clear
indication as to the character of such tenancy. That a statutory tenant is entitled
to the benefit of the terms and conditions of the original contract of tenancy so
far as they were consistent with the provisions of the statute did not as
Scrutton L.J. observed in Roe v. Russell [1928] 2 K.B. 117 'help very much
when one came to the practical facts of life', according to him 'citizens are
entitled to complain that their legislators did not address their minds to the
probable events that might happen in cases of statutory tenancy, and consider
how the legal interest they were granting was affected by those probable
events'. He added, ... it is pretty evident that the Legislature never considered
as a whole the effect on the statutory tenancy of such ordinary incidents as
death, bank-ruptcy, voluntary assignment, either inter vivos or by will, a total
or partial sub-letting; but from time to time put into one of the series of Acts a
provision as to one of the incidents without considering how it fitted in with the
general nature of the tenancy which those incidents might affect.' On the
provisions which gave no clear and comprehensive idea of the nature of
statutory tenancy, the courts in England had been slowly 'trying to frame a
consistent theory Scruttion L. J. Haskin v. Lewis [1935] 2 K. B. 1 making bricks
with very insufficient statutory straw' Scrutton L. J. in Keeves v. Dean [1923]
L.J.K.B. 203 Evershed M.R. in Boyer v. Warbey [1953] 2 K.B. 234 said : 'The
character of the statutory tenancy, I have already said, is a very special one. It
has earned many epithets, including 'monstrum horrendurm' and perhaps it has
never been fully thought out by Parliament'. Courts in England have held that a
statutory tenant has no estate or property in the premises Rent Acts and not as

being entitled to a tenancy; it has been said that he has only a personal right to
remain in occupation, the statutory right of 'irremovability', and nothing more.
We find it difficult to appreciate how in this country we can proceed on the
basis that a tenant whose contractual tenancy has determined but who is
protected against eviction by the statute, has no right of property but only a
personal right to remain in occupation, without ascertaining what his rights are
under the statute. The concept of a statutory tenant having no estate or
property in the premises which he occupies is derived from the provisions of
the English Rent Acts. But it is not clear how it can be assumed that the
position is the same in this country without any reference to the provisions of
the relevant statute. Tenancy has its origin in contract. There is no dispute that
a contractual tenant has an estate or property in the subject matter of the
tenancy, and heritability is an incident of the tenancy. It cannot be assumed,
however, that with the determination of the tenancy the estate must necessarily
disappear and the statute can only preserve his status of irremovability and not
the estate he had in the premises in his occupation. It is not possible to claim
that the 'sanctity' of contract cannot be touched by legislation, it is therefore
necessary to examine the provisions of the Madhya Pradesh Accommodation
Control Act, 1961 to find out whether the respondents' predecessors-in-interest
retained a heritable interest in the disputed premises even after ' the
termination of their tenancy.
Section 2(i) of the Madhya Pradesh Accommodation Control Act 1961 defines
'tenant' to mean, unless the context otherwise requires:
a person by whom or on whose account or behalf the rent of any
accommodation is, or, but for a contract express or implied would be
payable for any accommodation and includes any person occupying the
accommodation as a sub-tenant and also any person continuing in
possession after the termination of his tenancy whether before or after
the commencement of this Act; but shall not include any person against
whom any order or decree for eviction has been made.
The definition makes a person continuing in possession after the determination
of his tenancy a tenant unless a decree or order for eviction has been made
against him, thus putting him on par with a person whose contractual tenancy
still subsists. The incidents of such tenancy and a contractual tenancy must
therefore be the same unless any provision of the Act conveyed a contrary
intention. That under this Act such a tenant retains an interest in the premises,
and not merely a personal right of occupation, will also appear from Section 14
which contains provisions restricting the tenant's power of subletting. Section
14 is in these terms :
Section 14 Restriction on sub-letting.-(1) No tenant shall without the
previous consent in writing of the landlord.-
(a) sublet the whole or any part of the accommodation held by
him as a tenant : or
(b) transfer or assign his rights in the tenancy or in any part
thereof.
(2) No landlord shall claim or receive the payment of any sum

as premium or pugree or claim or receive any consideration
whatsoever in cash or in kind for giving his consent to the sub-
letting of the whole or any part of the accommodation held by
the tenant.
There is nothing to suggest that this section does not apply to all tenants as
defined in Section 2(i). A contractual tenant has an estate or interest in
premises from which he carves out what he gives to the sub-tenant. Section 14
read with Section 2(i) makes it clear that the so called statutory tenant has the
right to sub-let in common with a contractual tenant and this is because he also
has an interest in the premises occupied by him.
19. It may be noted that in deciding Damadilal's case (supra), this Court considered the
two decisions of this Court, namely, the decisions in Anand Nivas and Jagdish Chander
Chatterjee's cases (supra) which have been relied on by the learned Counsel for the
landlords.
20. The decision of this Court in the case of Ganpat Ladha v. Sashikant Vishnu Shinde
MANU/SC/0378/1978 : [1978]3SCR198 is another decision on which very strong
reliance has been placed on behalf of the landlords. In this case under Bombay Rents,
Hotel and Lodging House Rates Control Act, 1947, the Court was concerned with the
question whether the heirs of deceased tenant whose tenancy has been determined and
against whom eviction proceeding was pending, were entitled to the benefit of
protection afforded to the tenant after the determination of the tenancy in respect of the
business premises. This Court noticed at n page 202 that the tenancy right was being
claimed under Section 5(11)(c) of the said Act which, as recorded in the judgment, is in
the following terms :
5(11)(c) : 'tenant' means any person by whom or on whose account rent is
payable for any premises and includes -
(a). . .
(b). . .
(c) any member of the tenant's family residing with him at the time of
his death as may be decided in default of agreement by the Court.
While dealing with this question, this Court held at pp. 202-204 :
In these circumstances, the question arose for decision whether the present
respondent, whose residence is given in the special leave petition as 'Agakhan
Building, Haines Road, Bombay', could possibly claim to be a tenant in respect
of the shop which admittedly constitutes business premises by reason of
Section 5(11)(c) of the Act. The High Court took the view that Section 5(11)(c)
applies not only to residential premises but also to business premises and
therefore, on the death of a tenant of business premises, any member of
tenant's family residing with him at the time of his death would become a
tenant. We do not think this view taken by the High Court is correct. It is
difficult to see how in case of business premises, the need for showing
residence with the original tenant at the time of his death would be relevant. It
is obvious from the language of Section 5(11)(c) that the intention of the
legislature in giving protection to a member of the family of the tenant residing
with him at the time of his death was to secure that on the death of the tenant,

the member of his family residing with him at the time of his death is not
thrown out and this protection would be necessarily only in case of residential
premises. When a tenant is in occupation of business premises, there would be
no question of protecting against dispossession a member of the tenant's family
residing with him at the time of death. The tenant may be carrying on a
business in which the member of his family residing with him may not have any
interest at all and yet on the construction adopted by the High Court, such
member of the family would become a tenant in respect of the business
premises. Such a result could not have been intended to be brought about by
the legislature. It is difficult to discern any public policy which might seem to
require it. The principle behind Section 5(11)(c) seems to be that when a
tenant is in occupation of premises, the tenancy is taken by him not only for his
own benefit, but also for the benefit of the members of the family residing with
him and, therefore, when the tenant dies, protection should be extended to the
members of the family who were participants in the benefit of the tenancy and
for whose needs inter alia the tenancy was originally taken by the tenant. This
principle underlying the enactment of Section 5(11)(c) also goes to indicate
that it is in respect of residential premises that the protection of that section is
intended to be given. We can appreciate a provision being made in respect of
business premises that on the death of a tenant in respect of such premises,
any member of the tenant's family carrying on business with the tenant in such
premises at the time of his death shall be a tenant and the protection of the
Rent Act shall be available to him. But we fail to see the purpose the legislature
could have had in view in according protection in respect of business premises
to a member of the tenant's family residing with him at the time of his death.
The basic postulate of the protection under the Rent Act is that the person who
is sought to be protected must be in possession of the premises and his
possession is protected by the legislation. But in case of business premises, a
member of the family of the tenant residing with him at the time of his death
may not be in possession of the business premises; he may be in service or he
may be carrying on any other business. And yet on the view taken by the High
Court, he would become tenant in respect of the business premises with which
he has no connection. We are, therefore, in agreement with the view taken by
one of us (Bhagwati J.) in the Gujarat High Court about the correct meaning of
Section 5(11)(c) in Perupai Manilal Brahmin and Ors. v. Baldevdas Zaverbhai
Tapodhan [1964] 5 Guj, LR 563 in preference to the view adopted in the
subsequent decision of the Gujarat High Court in Heirs of deceased Darji
Mohanlal Lavji v. Muktabai Shamji [1971] 12 Guj. LR 272 which decision was
followed by the Bombay High Court in the judgment impugned in the present
appeals before us.
21. This decision proceeds entirely on the construction of Section 5(11)(c)(i) and it
does not appear that the case of Damadilal (supra) which also was in respect of
commercial premises was cited before this Court or was considered by the Court while
deciding this case. Section 5(11)(b) and Section 5(11)(c)(ii) were also not discussed.
22. The aforesaid decisions indicate that there is a divergence of opinion in this Court
on the question whether the heirs of a deceased tenant whose contractual tenancy in
respect of commercial premises has been determined, can inherit the tenancy rights of
the deceased tenant and can claim the benefit and protection to which the deceased
tenant was entitled under the Act.
2 3 . For an appreciation of the question it is necessary to understand the kind of

protection that is sought to be afforded to a tenant under the Rent Acts and his status
after the termination of the contractual tenancy under the Rent Acts. It is not in dispute
that so long as the contractual tenancy remains subsisting, the contractual tenancy
creates heritable rights; and, on the death of a contractual tenant, the heirs and legal
representatives step into the position of the contractual tenant; and, in the same way on
the death of a landlord the heirs and legal representatives of a landlord become entitled
to all the rights and privileges of the contractual tenancy and also come under all the
obligations under the contractual tenancy. A valid termination of the contractual tenancy
puts an end to the contractual relationship. On the determination of the contractual
tenancy, the landlord becomes entitled under the law of the land to recover possession
of the premises from the tenant in due process of law and the tenant under the general
law of the land is hardly in a position to resist eviction, once the contractual tenancy
has been duly determined. Because of scarcity of accommodation and gradual high rise
in the rents due to various factors, the landlords were in a position to exploit the
situation for unjustified personal gains to the serious detriment of the helpless tenants.
Under the circumstances it became imperative for the legislature to intervene to protect
the tenants against harassment and exploitation by avaricious landlords and appropriate
legislation came to be passed in all the States and Union Territories where the situation
required an interference by the legislature in this regard. It is no doubt true that the
Rent Acts are essentially meant for the benefit of the tenants. It is, however, to be
noticed that the Rent Acts at the same time also seek to safeguard legitimate interests
of the landlords. The Rent Acts which are indeed in the nature of social welfare
legislation are intended to protect tenants against harassment and exploitation by
landlords, safeguarding at the same time the legitimate interests of the landlords. The
Rent Acts seek to preserve social harmony and promote social justice by safeguarding
the interests of the tenants mainly and at the same time protecting the legitimate
interests of the landlords. Though the purpose of the various Rent Acts appear to be the
same, namely, to promote social justice by affording protection to tenants against
undue harassment and exploitation by landlords, providing at the same time for
adequate safeguards of the legitimate interests of the landlords, the Rent Acts
undoubtedly lean more in favour of the tenants for whose benefit the Rent Acts are
essentially passed. It may also be noted that various amendments have been introduced
to the various Rent Acts from time to time as and when situation so required for the
purpose of mitigating the hardship of tenants.
2 4 . Keeping in view the main object of Rent Control Legislation, the position, of a
tenant whose contractual tenancy has been determined has to be understood in the light
of the provisions of the Rent Acts. Though provisions of all the Rent Control Acts are
not uniform, the common feature of all the Rent Control Legislation is that a contractual
tenant on the termination of the contractual tenancy is by virtue of the provisions of the
Rent Acts not liable to be evicted as a matter of course under the ordinary law of the
land and he is entitled to remain in possession even after determination of the
contractual tenancy and no order or decree for eviction will be passed against a tenant
unless any ground which entitles the landlord to get an order or decree for possession
specified in the Act is established. In other words, the common feature of every Rent
Control Act is that it affords protection to every tenant against eviction despite
termination of tenancy except on grounds recognised by the Act and no order or decree
for eviction shall be passed against the tenant unless any such ground is established to
the satisfaction of the Court.
25. This Court has very aptly observed in Damadilal's case (supra) that it cannot be
assumed that with the determination of the tenancy, the estate must necessarily
disappear and the statute can only preserve the status of irremovability and not the

estate he has in the premises in his occupation; and it is not possible to claim that the
sanctity of contract cannot be touched by legislation. As already noticed, this Court in
Damadilal's case (supra) after referring mainly to the definition of tenant in Section 2(i)
of the Madhya Pradesh Accommodation Control Act, 1961 came to the so-called
statutory tenant had an interest in the premises occupied by him and the heirs of the
statutory tenant "had a heritable interest in the premises". A tenant has been defined in
Section 2(1) of the Delhi Rent Control Act, which reads as follows :
'tenant' means any person by whom or on whose account or behalf the rent of
any premises is, or, but for a special contract would be, payable, and includes-
(i) a sub-tenant;
(ii) any person continuing in possession after the termination of his
tenancy; and
(iii) in the event of the death of the person continuing in possession
after the termination of his tenancy, subject to the order of succession
and conditions specified respectively, in Explanation I and Explanation
II to this clause, such of the aforesaid person's-
(a) spouse,
(b) son or daughter, or, where there are both son and
daughter, both of them,
(c) parents,
(d) daughter-in-law, being the widow of his predeceased son,
as had been ordinarily living in the premises with such person as a member or
members of his family upto the date of his death, but does not include, -
(A) any person against whom an order or decree for eviction has been
made, except where such decree or order for eviction is liable to be re-
opened under the proviso to Section 3 of the Delhi Rent Control
(Amendment) Act, 1976.
(B) any person to whom a licence, as defined by Section 52 of the
Indian Easements Act, 1882 has been granted.
Explanation I.-The order of succession in the event of the death of the person
continuing in possession after the termination of his tenancy shall be as
follows.-
(a) firstly, his surviving spouse;
(b) secondly, his son or daughter, or both, if there is no surviving
spouse, or if the surviving spouse did not ordinarily live with the
deceased person as a member of his family upto the date of his death;
(c) thirdly, his parents, if there is no surviving spouse,
son or daughter of the deceased person, or if such surviving spouse,
son or daughter or any of them, did not ordinarily live in the premises

as a member of the family of the deceased person upto the date of his
death; and
(d) fourthly, his daughter-in-law, being the widow of his pre-deceased
son, if there is no surviving spouse, son, daughter or parents of the
deceased person, or if such surviving spouse son, daughter or parents,
or any of them, did not ordinarily live in the premises as a member of
the family of the deceased person up to the date of his death.
Explanation II.-If the person, who acquires, by succession, the right to continue
in possession after the termination of the tenancy, was not financially
dependent on the deceased person on the date of his death, such successor
shall acquire such right for a limited period of one year; and, on the expiry of
that period, or on his death, whichever is earlier, the right of such successor to
continue in possession after the termination of the tenancy shall become
extinguished.
Explanation III.-For the removal of doubts, it is hereby declared that,
(a) where, by reason of Explanation II, the right of any successor to
continue in possession after the termination of the tenancy becomes
extinct guished, such extinguishment shall not affect the right of any
other successor of the same category to continue in possession after
the termination of the tenancy; but if there is no other successor of the
same category, the right to continue in possession after the termination
of the tenancy shall not, on such extinguishment pass on to any other
successor, specified in any lower category or categories, as the case
may be ;
(b) the right of every successor, referred to in Explanation I, to
continue in possession after the termination of the tenancy, shall be
personal to him and shall not, on the death of such successor, devolve
on any of his heirs ;
The definition of tenant as it stands at present in the Act, is after the amendment of the
definition in Section 2(1) of the earlier Act, by the Amendment Act (Act 18 of 1976)
which was introduced with retrospective effect. Prior to the amendment, the definition
of tenant as it stood in the original Act, 1958 was in the following terms :
'tenant' means any person by whom or on whose account or behalf the rent of
any premises is, or, but for a special contract would be, payable and includes a
subtenant and also any person continuing in possession after the termination of
his tenancy but shall not include any person against whom any order or decree
for eviction have been made.
It is, therefore, clear from the definition of tenant, whether in the original Act or in the
amended Act, that the tenant within the meaning of the definition of the term in the Act
includes any person continuing in possession after the termination of his tenancy. It will
be seen that the definition of tenant in Madhya Pradesh Accommodation Control Act,
1961 on which the decision in Damadilal's case (supra) mainly turns, is similar to the
definition of tenant as given in the Delhi Act in the sense that the tenant under both the
Acts includes for the purpose of the Rent Act any person continuing in possession after
the termination of the tenancy.

26. The other section of the M.P. Accommodation Control Act 1961 considered by this
Court in deciding Damadilal's case (supra) was Section 14 which deals with sub-letting
and this Court held that there was nothing in that section to suggest that the section
would not apply to all tenants as defined in Section 2(1) of the said Act. Section 14 was
considered in Damadilal's case (supra) to ascertain whether the 'so called statutory
tenant' enjoyed the same right as the contractual tenant in the matter of sub-letting and
this Court held that the 'so called statutory tenant' enjoyed the same right as the
contractual tenant.
27. Let us now analyse the provisions of the Delhi Act to find out whether there is
anything in the other provisions to indicate that the tenant as defined in Section 2(1)(ii)
will stand on any different footing from a contractual tenant in the matter of enjoyment
of the protection and benefits sought to be conferred on a tenant by the Act.
28. Section 2(e) defines landlord and clearly indicates that the landlord continues to be
the landlord for the purpose of the Act even after termination of the contractual tenancy.
Section 2(1) which defines 'tenant' has been set out earlier in its entirety. We shall
consider the true effect of Section 2(1)(iii) on which as earlier noted, reliance has been
placed by the learned Counsel of the landlords, when we deal with the argument which
has been advanced on the basis of this Sub-section. Section 3 mentions premises which
are outside the purview of this Act and has no bearing on the question involved.
Chapter II of the Act consists of Sections 4 to 13 and makes provision regarding rent.
These Sections indicate that they are applicable to tenants as defined in Section 2(1)
including 2(1)(iii). Chapter III consists of Sections 14 to 25 of the Act and deals with
eviction and control of eviction of tenants. Section 14 starts as follows :
notwithstanding anything to the contrary contained in any other law or contract,
no order or decree for the recovery of possession of any premises shall be
made by any Court or Controller in favour of the landlord against a tenant ;
...
Thereafter various provisions are made as to grounds and under what circumstances a
decree for eviction may be passed. This section, therefore, clearly postulates that
despite the termination of the tenancy and notwithstanding the provisions of any other
law which might have been applicable on the termination of the contractual tenancy,
protection against eviction is applicable to every tenant as defined in Section 2(1) of the
Act. This section clearly establishes that determination of a contractual tenancy does not
disqualify him from continuing to be a tenant within the meaning of this Act and the
tenant whose contractual tenancy has been determined enjoys the same position and is
entitled to protection against eviction. The other Sections in this chapter also go to
indicate that the tenant whose tenancy has been terminated enjoys the same status and
benefit as a tenant whose tenancy has not been terminated, and a tenant after
termination of his tenancy stands on the same footing as the tenant before such
termination. Chapter III A which provides for summary trial for certain applications also
does not make any distinction between a tenant whose tenancy has been determined
and a tenant whose tenancy had not been terminated. Chapter IV which deals with
deposit of rent consists of Sections 26 to 29 and these Sections make it clear that the
tenant after determination of a tenancy is treated under the Act on the same footing as a
tenant whose tenancy has not been determined. Chapter V which consists of Sections 30
to 34 deals with hotels and lodging houses and does not have any relevance to the
question involved. Chapter VI which consists of Sections 35 to 43 provides for
appointment of Controllers and their powers and functions and also makes provisions

with regard to appeals. This chapter though not very material for the purpose of
adjudication of the point involved indicates that no discrimination is made in the matter
of proceedings for eviction between the 'so called statutory tenant' and a contractual
tenant. Chapter VII which consists of Sections 44 to 49 makes provisions regarding
obligations of landlords and also provides for penalties in appropriate cases. The
sections make it clear that the duties and obligations cast upon the landlord apply
equally whether the tenant is a so called 'statutory tenant' or the tenant is a contractual
tenant. Chapter VIII which makes various miscellaneous provisions does not have any
bearing on the question involved. It may, however, be noted that Section 50 which bars
the jurisdiction of Civil Courts in respect of certain matters does not in any way
discriminate between a 'so called statutory tenant' and a contractual tenant. The
provisions of the Act, therefore, make it abundantly clear that the Act does not make
any distinction between a 'so called statutory tenant' and a contractual tenant and the
Act proceeds to treat both alike and to preserve and protect the status and rights of a
tenant after determination of the contractual tenancy in the same way as the status and
rights of a contractual tenant are protected and preserved.
29. While on this question it will be appropriate to quote the following observations of
this Court in the case of V. Dhanapal Chettiar v. Yesodai Ammal (supra) at 340 :
Once the liability to be evicted is incurred by the tenant, he cannot turn round
and say that the contractual lease has not been determined. The action of the
landlord in instituting a suit for eviction on the ground mentioned in any State
Rent Act will be tantamount to an expression of his intention that he does not
want the tenant to continue as his lessee and the jural relationship of lessor
and lessee will come to an end on the passing of an order or a decree for
eviction. Until then, under the extended definition of the word 'tenant' under the
various State Rent Acts, the tenant continues to be a tenant even though the
contractual tenancy has been determined by giving a valid notice under Section
106 of the Transfer of Property Act. In many cases the distinction between a
contractual tenant and a statutory tenant was alluded to for the purpose of
elucidating some particular aspects which cropped up in a particular case. That
led to the criticism of that expression in some of the decisions. Without
detaining ourselves on this aspect of the matter by any elaborate discussion, in
our opinion, it will suffice to say that the various State Rent Control Acts make
a serious encroachment in the field of freedom of contract. It does not permit
the landlord to snap his relationship with the tenant merely by his Act of
serving a notice to quit on him. Inspire of the notice, the law says that he
continues to be a tenant and and he does so enjoying all the rights of a lessee
and is at the same time deemed to be under all the liabilities such as payment
of rent etc. in accordance with the law.
30. These observations were made by a seven-Judge Bench of this Court. It is no doubt
true that these observations were made while considering the question of requirement
of a notice under Section 106 of the Transfer of Property Act before the institution of
Suit for recovery of possession of premises to which the Rent Act applies. These
observations, however, clearly go to establish that mere determination of the
contractual tenancy does not in any way bring about any change in the status of a
tenant. As aptly observed in this decision, "it will suffice to say that the various State
Rent Control Acts make a serious encroachment in the field of freedom of contract. It
does not permit the landlord to snap his relationship with the tenant merely by his act
of serving a notice to quit on him. Inspite of the notice, the law says that he continues
to be a tenant and he does so, enjoying all the rights of a lessee and is at the same

time deemed to be under all the liabilities such as payment of rent etc. in accordance
with the law."
3 1 . We now proceed to deal with the further argument advanced on behalf of the
landlords that the amendment to the definition of 'tenant' with retrospective effect
introduced by the Delhi Rent Control Amendment Act (Act 18 of 1976) to give personal
protection and personal sight of continuing in possession to the heirs of the deceased
statutory tenant in respect of residential premises only and not with regard to the heirs
of the 'so called statutory tenant' in respect of commercial premises, indicates that the
heirs of so called statutory tenants, therefore, do not enjoy any protection under the
Act. This argument proceeds on the basis that in the absence of any specific right
created in favour of the 'so called statutory tenant' in respect of his tenancy, the heirs of
the statutory tenant who do not acquire any interest or estate in the tenanted premises,
become liable to be evicted as a matter of course. The very premise on the basis of
which the argument is advanced is, in our opinion, unsound. The termination of the
contractual tenancy in view of the definition of tenant in the Act does not bring about
any change in the status and legal position of the tenant, unless there are contrary
provisions in the Act; and, the tenant notwithstanding the termination of tenancy does
enjoy an estate or interest in the tenanted premises. This interest or estate which the
tenant under the Act despite termination of the contractual tenancy continues to enjoy
creates a heritable interest in the absence of any provision to the contrary. We have
earlier noticed the decision of this Court in Damadilal's case (supra). This view has
been taken by this Court in Damadilal's case and in our opinion this decision represents
the correct position in law. The observations of this Court in the decision of the Seven
Judge Bench in the case of V. Dhanapal Chettiar v. Yesodai Ammal (supra) which we
have earlier quoted appear to conclude the question. The amendment of the definition
of tenant by the Act 18 of 1976 introducing particularly 2(1)(iii) does not in any way
mitigate against this view. The said Sub-section (iii) with all the three Explanations
thereto is not in any way inconsistent with or contrary to Sub-section (ii) of Section
2(1) which unequivocally states that tenant includes any person continuing in
possession after the termination of his tenancy. In the absence of the provision
contained in Sub-section 2(1)(iii) the heritable interest of the heirs of the statutory
tenant would devolve on all the heirs of the 'so called statutory tenant' on his death and
the heirs of such tenant would in law step into his position. This Sub-section (iii) of
Section 2(1) seeks to restrict this right in so far as the residential premises are
concerned. The heritability of the statutory tenancy which otherwise flows from the Act
is restricted in case of residential premises only to the heirs mentioned in Section 2(1)
[iii) and the heirs therein are entitled to remain in possession and to enjoy the
protection under the Act in the manner and to the extent indicated in Sub-section 2(1)
(iii). The Legislature, which under the Rent Act affords protection against eviction to
tenants whose tenancies have been terminated and who continue to remain in
possession and who are generally termed as statutory tenants, is perfectly competent to
lay down the manner and extent of the protection and the rights and obligations of such
tenants and their heirs. Section 2(1)(iii) of the Act does not create any additional or
special right in favour of the heirs of the 'so called statutory tenant' on his death, but
seeks to restrict the right of the heirs of such tenant in respect of residential premises.
As the status and rights of a F contractual tenant even after determination of his tenancy
when the tenant is at times described as the statutory tenant, are fully protected by the
Act and the heirs of such tenants become entitled by virtue of the provisions of the Act
to inherit the status and position of the statutory tenant on his death, the Legislature
which has created this right has thought it fit in the case of residential premises to limit
the rights of the heirs in the manner and to the extent provided in Section 2(1)(iii). It
appears that the Legislature has not thought it fit to put any such restrictions with

regard to tenants in respect of commercial premises in this Act.
3 2 . It may be noted that for certain purposes the Legislature in the Delhi Act in
question and also in various other Rent Acts has treated commercial premises differently
from residential premises Section 14(1)(d) provides that it will be a good ground for
eviction of a tenant from residential premises, if the premises let out for use as
residence is not so used for a period of six months immediately before the filing of the
application for the recovery of possession of the premises. Similarly Section 14(1)(e)
makes bonafide requirement o of the landlord of the premises let out to the tenant for
residential purposes a good ground for eviction of the tenant from such premises. These
grounds, however, are not made available in respect of commercial premises.
33. We find it difficult to agree with the observations which we have quoted earlier
made by this Court in the case of Ganapat Ladha v. Sashi Kant Vishnu Shinde (supra).
34. It may be noticed that the Legislature itself treats commercial tenancy differently
from residential tenancy in the matter of eviction of the tenant in the Delhi Rent Act and
also in various other Rent Acts. All the grounds for eviction of a tenant of residential
premises are not made grounds for eviction of a tenant in respect of commercial
premises. Section 14(1)(d) of the Delhi Rent Act provides that non-user of the
residential premises by the tenant for a period of six months immediately before the
filing of the application for the recovery of possession of the premises will be a good
ground for eviction, though in case of a commercial premises no such provision is
made. Similarly, Section 14(1)(e) which makes bona fide requirement of the landlord of
the premises let out to the tenant for residential purposes a ground for eviction of the
tenant, is not made applicable to commercial premises. A tenant of any commercial
premises has necessarily to use the premises for business purposes. Business carried on
by a tenant of any commercial premises may be and often is, his only occupation and
the source of livelihood of the tenant and his family. Out of the income earned by the
tenant from his business in the commercial premises, the tenant maintains himself and
his family; and the tenant, if he is residing in a tenanted house, may also be paying his
rent out of the said income. Even if tenant is evicted from his residential premises, he
may with the earnings out of the business be in a position to arrange for some other
accommodation for his residence with his family. When, however, a tenant is thrown
out of the commercial premises, his business which enables him to maintain himself
and his family comes to a stand-still. It is common knowledge that it is much more
difficult to find suitable business premises than to find suitable premises for residence.
It is no secret that for securing commercial accommodation, large sums of money by
way of salami, even though not legally payable, may have to be paid and rents of
commercial premises are usually very high. Besides, a business which has been carried
on for years at a particular place has its own goodwill and other distinct advantages.
The death of the person who happens to be the tenant of the commercial premises and
who was running the business out of the income of which the family used to be
maintained, is itself a great loss to the members of the family to whom the death,
naturally, comes as a great blow. Usually, on the death of the person who runs the
business and maintains his family out of the income of the business, the other members
of the family who suffer the bereavement have necessarily to carry on the business for
the maintenance and support of the family. A running business is indeed a very valuable
asset and often a great source of comfort to the family as the business keeps the family
going. So long as the contractual tenancy of a tenant who carries on the business
continues, there can be no question of the heirs of the deceased tenant not only
inheriting the tenancy but also inheriting the business and they are entitled to run and
enjoy the same. We have earlier held that mere termination of the contractual tenancy

does not bring about any change in the status of the tenant and the tenant by virtue of
the definition of the 'tenant' in the Act and the other Rent Acts continues to enjoy the
same status and position unless there be any provisions in the Rent Acts which indicate
to the contrary. The mere fact that in the Act no provision has been made with regard to
the heirs of tenants in respect of commercial tenancies on the death of the tenant after
termination of the tenancy, as has been done in the case of heirs of the tenants of
residential premises, does not indicate that the Legislature intended that the heirs of the
tenants of commercial premises will cease to enjoy the protection afforded to the tenant
under the Act. The Legislature could never have possibly intended that with the death of
a tenant of the commercial premises, the business carried on by the tenant, however
flourishing it may be and even if the same constituted the source of livelihood of the
members of the family, must necessarily come to an end on the death of the tenant,
only because the tenant died after the contractual tenancy had been terminated. It could
never have been the intention of the Legislature that the entire family of a tenant
depending upon the business carried on by the tenant will be completely stranded and
the business carried on for years in the premises which had been let out to the tenant
must stop functioning at the premises which the heirs of the deceased tenant must
necessarily vacate, as they are afforded no protection under the Act. We are of the
opinion that in case of commercial premises governed by the Delhi Act, the Legislature
has not thought it fit in the light of the situation at Delhi to place any kind of restriction
on the ordinary law of inheritance with regard to succession. It may also be borne in
mind that in case of commercial premises the heirs of the deceased tenant not only
succeed to the tenancy rights in the premises but they succeed to the business as a
whole. It might have been open to the Legislature to limit or restrict the right of
inheritance with regard to the tenancy as the Legislature had done in the case of the
tenancies with regard to the residential houses but it would not have been open to the
Legislature to alter under the Rent Act, the Law of Succession regarding the business
which is a valuable heritable right and which must necessarily devolve on all the heirs
in accordance with law. The absence of any provision restricting the heritability of the
tenancy in respect of the commercial premises only establishes that commercial
tenancies notwithstanding the determination of the contractual tenancies will devolve on
the heirs in accordance with law and the heirs who step into the position of the
deceased tenant will continue to enjoy the protection afforded by the Act and they can
only be evicted in accordance with the provisions of the Act. There is another significant
consideration which, in our opinion, lends support to the view that we are taking.
Commercial premises are let out not only to individuals but also to Companies,
Corporations and other statutory bodies having a juristic personality. In fact, tenancies
in respect of commercial premises are usually taken by Companies and Corporations.
When the tenant is a Company or a Corporation or anybody with juristic personality,
question of the death of the tenant will not arise. Despite the termination of the
tenancy, the Company or the Corporation or such juristic personalities, however, will go
on enjoying the protection afforded to the tenant under the Act. It can hardly be
conceived that the Legislature would intend to deny to one class of tenants, namely,
individuals the protection which will be enjoyed by the other class' namely, the
Corporations and Companies and other bodies with juristic personality under the Act. If
it be held that commercial tenancies after the termination of the contractual tenancy of
the tenant are not heritable on the death of the tenant and the heirs of the tenant are
not entitled to enjoy the protection under the Act, an irreparable mischief which the
Legislature could never have intended is likely to be caused. Any time after the creation
of the contractual tenancy, the landlord may determine the contractual tenancy,
allowing the tenant to continue to remain in possession of the premises, hoping for an
early death of the tenant, so that on the death of a tenant he can immediately proceed

to institute the proceeding for recovery and recover possession of the premises as a
matter of course, because the heirs would not have any right to remain in occupation
and would not enjoy the protection of the Act. This could never have been intended by
the Legislature while framing the Rent Acts for affording protection to the tenant against
eviction that the landlord would be entitled to recover possession, even no grounds for
eviction as prescribed in the Rent Acts are made out.
35. In our opinion, the view expressed by this Court in Ganpat Ladha's case and the
observations made therein which we have earlier quoted, do not lay down the correct
law. The said decision does not properly construe the definition of the 'tenant' as given
in Section 5(11)(b) of the Act and does not consider the status of the tenant, as defined
in the Act, even after termination of the commercial tenancy. In our judgment in
Damadilal's case this Court has correctly appreciated the status and the legal position of
a tenant who continues to remain in possession after termination of the contractual
tenancy. We have quoted at length the view of this Court and the reasons in support
thereof. The view expressed by a seven-Judge Bench of this Court in Dhanapal
Chetttiar's case and f the observations made therein which we have earlier quoted, lend
support to the decision of this Court in Dhamadilal's case. These decisions correctly lay
down that the termination of the contractual tenancy by the landlord does not bring
about a change in the status of the tenant who continues to remain in possession after
the termination of the tenancy by virtue of the provisions of the Rent Act. A proper
interpretation of the definition of tenant in the light of the provisions made in the Rent
Acts makes it clear that the tenant continues to enjoy an estate or interest in the
tenanted premises despite the termination of the contractual tenancy.
36. Accordingly, we hold that if the Rent Act in question defines a tenant in substance
to mean a tenant who continues to remain in possession even after the termination of
the contractual tenancy till a decree for eviction against him is passed', the tenant even
after the determination of the tenancy continues to have an estate or interest in the
tenanted premises and the tenancy rights both in respect of residential premises and
commercial premises are heritable. The heirs of the deceased tenant in the absence of
any provision in the Rent Act to the contrary will step into the position of the decreased
tenant and all the rights and obligations of the deceased tenant including the protection
afforded to the deceased tenant under the Act will devolve on the heirs of the deceased
tenant. As the protection afforded by the Rent Act to a tenant after determination of the
tenancy and to his heirs on the death of such tenant is a creation of the Act for the
benefit of the tenants, it is open to the Legislature which provides for such protection to
make appropriate provisions in the Act with regard to the nature and extent of the
benefit and protection to be enjoyed and the manner in which the same is to be
enjoyed. If the Legislature makes any provision in the Act limiting or restricting the
benefit and the nature of the protection to be enjoyed in a specified manner by any
particular class of heirs of the deceased tenant on any condition laid down being
fulfilled, the benefit of the protection has necessarily to be enjoyed on the fulfilment of
the condition in the manner and to the extent stipulated in the Act. The Legislature
which by the Rent Act seeks to confer the benefit on the tenants and to afford protection
against eviction, is perfectly competent to make appropriate provision regulating the
nature of protection and the manner and extent of enjoyment of such tenancy rights
after the termination of contractual tenancy of the tenant including the rights and the
nature of protection of the heirs on the death of the tenant. Such appropriate provision
may be made by the Legislature both with regard to the residential tenancy and
commercial tenancy. It is, however, entirely for the Legislature to decide whether the
Legislature will make such provision or not. In the absence of any provision regulating
the right of inheritance, and the manner and extent thereof and in the absence of any

condition being stipulated with regard to the devolution of tenancy rights on the heirs
on the death of the tenant, the devolution of tenancy rights must necessarily be in
accordance with the ordinary law of succession.
37. In the Delhi Act, the Legislature has thought it fit to make provisions regulating the
right to inherit the tenancy rights in respect of residential premises. The relevant
provisions are contained in Section 2(1)(iii) of the Act. With regard to the commercial
premises, the Legislature in the Act under consideration has thought it fit not to make
any such provision. It may be noticed that in some Rent Acts provisions regulating
heritability of commercial premises, have also been made whereas in some Rent Acts no
such provision either in respect of residential tenancies or commercial tenancies has
been made. As in the present Act, there is no provision regulating the rights of the heirs
to inherit the tenancy rights of the tenanted premises which is commercial premises, the
tenancy right which is heritable devolves on the heirs under the ordinary law of
succession. The tenancy right of Wasti Ram, therefore, devolves on all the heirs of
Wasti Ram on his death.
38. We must, therefore, hold that Wasti Ram enjoyed the statute of the premises in
dispute even after determination of the contractual tenancy and notwithstanding the
termination of the contractual tenancy, Wasti Ram had an estate or interest in the
demised premises; and tenancy rights of Wasti Ram did not come to an end with his
death but they devolved on the heirs and legal representative of Wasti Ram. The heirs
and legal representatives of Wasti Ram step into his position and they are entitled to the
benefit and protection of the Act. We must, accordingly, hold that the High Court was
not right in coming to the conclusion that the heirs of Wasti Ram, the so called statutory
tenant, did not have any right to remain in possession of the tenanted premises and did
not enjoy any protection under the Act. It appears that the High Court passed an order
for eviction against the heirs of Wasti Ram only on this ground without going into the
merits of the appeal filed by the appellant in the High Court against the order of remand
and also without considering the cross-objections filed in the High Court by the
landlord. We accordingly, set aside the judgment and order of the High Court and we
remand the case to the High Court for decision of the appeal and the cross objection on
merits. The appeal is accordingly allowed to the extent indicated above with no order as
to costs.
3 9 . Before concluding, there is one aspect which we consider it desirable to make
certain observations. The owner of any premises, whether residential or commercial, let
out to any tenant, is permitted by the Rent Control Acts to seek eviction of the tenant
only on the ground specified in the Act, entitling the landlord to evict the tenant from
the premises. The restrictions on the power of the landlords in the matter of recovery of
possession of the premises let out by him to a tenant have been imposed for the benefit
of the tenants. Inspite of various restrictions put on the landlord's right to recover
possession of the premises from a tenant, the right of the landlord to recover
possession of the premises from the tenant for the bona fide p need of the premises by
the landlord is recognised by the Act, in case of residential premises. A landlord may let
out the premises under various circumstances. Usually a landlord lets out the premises
when he does not need it for own use. Circumstances may change and a situation may
arise when the landlord may require the premises let out by him for his own use. It is
just and proper that when the lender lord requires the premises bona fide for his own
use and occupation, the landlord should be entitled to recover the possession of the
premises which continues to be his property inspite of his letting out the same to a
tenant. The legislature in its wisdom did recognise this fact and the Legislature has
provided that bona fide requirement of the landlord for his own use will be a legitimate

ground under the Act for the eviction of his tenant from any residential premises. This
ground is, however, confined to residential premises and is not made available in case
of commercial premises. A landlord who lets out commercial premises to a tenant under
certain circumstances may need bona fide the premises for his own use under changed
conditions in some future date should not in fairness be deprived of his right to recover
the commercial premises. Bona fide need of the landlord will stand very much on the
same footing in regard to either class of premises, residential or commercial. We
therefore, suggest that Legislature may consider the advisability of making the bona
fide requirement of the landlord a ground of eviction in respect of commercial premises
as well.
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MANU/SC/0381/1985

IN THE SUPREME COURT OF INDIA

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