HARIDAS v. MERCANTILE EMPLOYEES ASSOCIATION — 1975 DIGILAW 17 (KER)

Judgment :- 1. The revision petitioner is in occupation of a non-residential building situated within the Calicut City limits as a tenant under the respondent. A petition, R.C.O.P. 86 of 1968, was filed by the respondent before the Rent Control Court, Kozhikode, under S.11 (2) and (7) of the Kerala Buildings (Lease & Rent Control) Act, 1965, for the eviction of the revision petitioner on the ground that he had kept the rent in arrears and that the building was needed by the landlord who claimed to be a public institution within the meaning of the expression as used in S.11 (7) for the purposes of the said institution. It may be mentioned at this juncture that the respondent-landlord is a Mercantile Employees' Association which is a trade union registered under the Indian Trade Unions Act, 1926. The plea put forward by the landlord is that the building is needed for the purposes of re-starting a Recreation Club for the members of the Association. 2. The revision petitioner (tenant) refuted the claim of the respondent - Association that it is a public institution entitled to claim the benefits of Subsection (7) of S.11. It was also contended by the tenant that the case set up by the landlord that the building is needed for the purposes of the Association was not bona fide or true since the Association was in possession of an upstairs portion consisting of a hall in another building belonging to itself which portion was lying vacant. The claim for eviction based on non-payment of rent was also disputed by the tenant by contending that there were no arrears and that he had paid off all the rent in arrears and was not, therefore, liable to be called upon to vacate the premises. 3. The Rent Control Court held that the respondent - Association is not a public institution so as to entitle it to invoke the benefits of sub-section (7) of S.11 of the Act. It also found that the General Secretary of the Association who had purported to file the eviction petition on his behalf was not competent to institute any such proceedings, since, under the Articles of the Constitution governing the Association, the President alone is vested with the authority to represent the Association before courts, tribunals etc. It also found that the General Secretary of the Association who had purported to file the eviction petition on his behalf was not competent to institute any such proceedings, since, under the Articles of the Constitution governing the Association, the President alone is vested with the authority to represent the Association before courts, tribunals etc. As regards the prayer for eviction based on non-payment of rent, counsel for the landlord conceded before the Rent Control Court that all arrears of rent had been cleared. 4. In the light of the findings arrived at by the Rent Control Court on the question regarding that the respondent - Associations not a public institution and that the General Secretary who filed the petition had no competence to represent the Association, it dismissed the petition without entering any finding on the question as to whether the plea of bona fide need put forward by the landlord was true. 5. The respondent - Association took up the matter in appeal before the Subordinate Judge, Kozhikode, in his capacity as appellate authority under the Act. The learned Subordinate Judge by his judgment dated 3rd October 1970 held that the respondent - Association is a public institution within the meaning of the expression as used in S.11(7) of the Act, and that the contrary finding entered into by the Rent Control Court was incorrect. However, the appellate authority did not go into the question of the competence of the General Secretary to institute the proceedings for eviction on behalf of the Association. After recording its finding on the first point relating to the status of the Association as to whether the respondent - Association was a public institution, the appellate authority proceeded to consider whether the claim put forward by the Association that it needed the building for the purposes of the Association was established as bona fide by the evidence. On a consideration of the evidence adduced in the case, the appellate authority came to the conclusion that in view of the fact that the Association was also in possession of a spacious hall on the first floor of a building belonging to itself, the landlord had no need for recovery of the petition-schedule building for the purposes set out in the application, viz., for re-starting a Club for the members of the Association. In view of this finding arrived at by the appellate authority it confirmed the order of the Rent Control Court dismissing the application for eviction, and rejected the appeal. 6. The Association thereupon filed a revision petition before the District Court, Kozhikode, under S.20 of the Act challenging the legality and correctness of the decisions rendered by the Rent Controller and the appellate authority. That Revision Petition was allowed by the learned District Judge as per his judgment dated 29th July, 1974. The ground on which the learned District Judge has reversed the decision of the appellate authority is that in considering a prayer for eviction made by a public institution under S.11(7) of the Act, "The bona fides of the requirement or the availability of alternative premises are not strictly matters for consideration." and that "Having found that the petitioner institution is a public institution, the learned Subordinate Judge ought to have allowed eviction under S.11(7) of the Act without considering the extraneous aspect as to the availability of alternative premises with the petitioner-institution." In this view the District Judge allowed the prayer of the Association for recovery of possession of the building from the tenant and ordered eviction of the tenant under S.11(7) of the Act. It is against this decision of the District Court that the tenant has come up to this Court with this Civil Revision Petition. 7. Although, the learned advocate appearing for the petitioner contended before us that the finding entered by the appellate authority and accepted by the revisional court that the respondent - Association is a public institution is not correct and tenable, we do not find any merit in this contention. We have gone through the constitution of the respondent - Association and scrutinised the objects and purposes for which the said Association has been established. It is clear, that judged by the objects for which the Association stands and the nature of its membership which consists of various classes of industrial workers and commercial employees who certainly constitute a substantial section of the public, the Association cannot be said to be a private body and must be held to be a public institution. It is clear, that judged by the objects for which the Association stands and the nature of its membership which consists of various classes of industrial workers and commercial employees who certainly constitute a substantial section of the public, the Association cannot be said to be a private body and must be held to be a public institution. We reject the petitioner's contention and confirm the finding entered by the revivals court and by the appellate authority that the first respondent is a Public Institution falling within the scope of the said expression as used in S.11 (7) of the Act. 8. The next contention urged before us on behalf of the revision petitioner is that the District Judge was in error in thinking that in an application made by a Public Institution under S.11(7) of the Act, the Rent Control Court is not called upon to consider whether the plea put forward by the landlord that the building is needed for the purposes of the institution is bona fide. The counsel relics on the provisions of sub-section (10) of S.11 as clearly laying down that the Rent Control Court should reject an application made under sub-section (7) if it is not satisfied about the bona fides of the claim put forward by the landlord. We find that there is force in this contention. We shall extract sub-sections (7) and (10) of S.11 of the Act. They read: "(7) Where the landlord of a building is a religious, charitable, educational or other public institution, it may, if the building is needed for the purposes of the institution, apply to the Rent Control Court, for an order directing the tenant to put the institution, in possession of the building. They read: "(7) Where the landlord of a building is a religious, charitable, educational or other public institution, it may, if the building is needed for the purposes of the institution, apply to the Rent Control Court, for an order directing the tenant to put the institution, in possession of the building. (10) The Rent Control Court shall if it is satisfied that the claim of the landlord under sub-sections (3), (4) and (7) of sub-s. (8) is bona fide make an order directing the tenant to put the landlord in possession of the building on such date as may be specified by the Rent Control Court, and if the Court is not so satisfied, it shall make an order rejecting the application: Provided that, in the case of an application made under sub-section (8), the Rent Control Court shall reject the application if it is satisfied that the hardship which may be caused to the tenant by granting it will outweigh the advantage to the landlord: Provided further that the Rent Control Court may give the tenant a reasonable time for putting the landlord in possession of the building and may extend such time so as not to exceed three months in the aggregate." On a combined reading of these sub-sections 7 and 10 there cannot be any doubt that the Rent Control Court is under a mandatory obligation to investigate into the bona fides of the claim put forward by the landlord under subsection (7) and to reject an application if it is not satisfied that the claim is bona fide. It is only when the Rent Control Court is satisfied that the claim put forward by the landlord under sub-section (7) that the building in question is needed for the purposes of the Public Institution is bonafide that it can direct the tenant to put the landlord in possession of the building. The view taken by the learned District Judge that a consideration of the question as to whether there was bona fide need for the institution which the respondent has purported to represent to recover possession of the building for the purposes of the institution was extraneous to an enquiry under S.11(7) of the Act, is therefore manifestly incorrect. The view taken by the learned District Judge that a consideration of the question as to whether there was bona fide need for the institution which the respondent has purported to represent to recover possession of the building for the purposes of the institution was extraneous to an enquiry under S.11(7) of the Act, is therefore manifestly incorrect. The decision of the learned District Judge allowing the landlord's prayer for eviction being based solely on the erroneous assumption that such an investigation need not be made in an application under S.11(7), it cannot be sustained. 9. It was also a serious omission on the part of the District Judge to have gone into the question about the competence of the General Secretary of the Association to maintain the eviction petition on its behalf before passing final orders allowing prayer for eviction, particularly in view of the clear finding entered into by the Munsiff that the General Secretary who instituted the proceeding for eviction was not competent to represent the Association which is the landlord. No doubt, the appellate authority did not find it necessary to enter any finding on the question in view of the fact that on the basis of the conclusion arrived at by it on the other points the order passed by the Rent Control Court dismissing the petition for eviction had only to be confirmed. Since the District Judge was differing from those findings entered by the appellate authority and was inclined to allow the prayer for eviction it was incumbent on him to consider the crucial question as to the maintainability of the eviction petition by the person who has instituted it before disposing of the case finally in favour of the petitioner. 10. In the result, we allow this Revision Petition, set aside the decision of the District Judge and remand C.R.P. No. 15/71 to the District Court, Kozhikode, for fresh disposal in accordance with law in the light of the observations contained in this judgment. The parties will bear their respective costs in this court. In the fresh order to be passed by the District Court appropriate provision will be made regarding the costs incurred by the parties in the courts below. Allowed.