Oriental Trading Company v. State Bank of India — 1994 DIGILAW 472 (KER)

Judgment :- This is a tenant's petition for setting aside Ext. P4 order dated 22-10-1993 in E.P.No. 80 of 1987 arising out of R.C.P.No. 67 of 1965 on the file of the Munsiff s Court, Ernakular And Ext. P5 order dated 29-10-1993 in R.C.R.P.No. 3 of 1993 on the file of the District Court, Ernakulam by which the second petitioner has been directed to surrender the premises in question to the first respondent in pursuance of an order for eviction, passed under S.11 of the Kerala Buildings (Lease & Rent Control) Act (for short the act). 2. The first petitioner is a firm and the second petitioner is the managing partner of that firm. The father of the second petitioner, as the managing partner of the firm, took a shop room on lease under the erstwhile Bank of Cochin Ltd. The said bank filed R.C.P.No. 67 of 1965 in the Rent Control Court, Ernakulam seeking recovery of the shop room on the allegation that it is required for additional accommodation under S.11(8) of the Kerala Buildings (Lease & Rent Control) Act. The Rent Controller dismissed the petition. But, on appeal, the prayer was allowed and an order for eviction was passed in R.C.A.No. 21 of 1968. The appellate judgment was set aside in revision in R.C.R.P.No. 6 of 1969 by the Additional District Judge, Ernakulam. In the second revision filed by the Bank as C.R.P.No.1319 of 1972, this Court, by Ext. P1 order dated 6-4-1973, set aside the order of the first revisional court and an order of eviction was passed. But, before the order for eviction was executed the Bank of Cochin Limited was amalgamated with the State Bank of India (1st Respondent herein) under S.45 of the Banking Regulations Act. Pursuant to these proceedings, the Bank of Cochin Limited ceased to exist on 26-8-1985 and all its assets and liabilities stood transferred to the State Bank of India. On 10-8-1987, the State Bank of India filed an execution petition for eviction of the petitioners from the said premises. After the receipt of the notice, the father of the 2nd petitioner who was the managing partner of the firm died. The second petitioner was therefore impleaded as the legal heir of the deceased managing partner of the firm. On 10-8-1987, the State Bank of India filed an execution petition for eviction of the petitioners from the said premises. After the receipt of the notice, the father of the 2nd petitioner who was the managing partner of the firm died. The second petitioner was therefore impleaded as the legal heir of the deceased managing partner of the firm. He resisted the execution petition by contending that the first respondent is not entitled to execute the order of eviction which was obtained by the Bank of Cochin Ltd. for its personal use. By Ext. P4 order, the learned Munsiff overruled the objections and directed for eviction of the petitioners. By Ext. P5 order in R.C.R.P.No. 3 of 1993, the learned 1 st Additional District Court confirmed the order of the learned Munsiff. 3. It is contended by the second petitioner that the transfer under S.45 of the Banking Regulation Act cannot have the effect of transferring a right to execute an order for eviction which was passed on the ground that the Bank of Cochin required additional accommodation for its personal use and that the hardship caused to the tenant by such eviction will not outweigh the advantage of the landlord. An order for eviction of the tenant for the personal use of the premises by the transferor landlord will not enure to the benefit of and cannot be executed by a transferee. The principles applicable 'to transfer by succession are applicable to the transfer effected in an amalgamation of banking companies. If the order for eviction is executed, it will result in great injustice and irreparable injury to the petitioner. 4. In the counter-affidavit filed by the 1st respondent, it is stated that the second petitioner being not a tenant is incompetent to raise any objection to the execution of the decree. Nevertheless his objections were considered by the courts below and passed the impugned order in which there is no legal infirmity. The assets and liabilities and all property rights of the Bank of Cochin which vested in the State Bank of India by operation of law includes the right to execute the order for eviction. The question of personal use does not survive to be considered after the order for eviction became final. The order is a decree fcr all intents and purposes under S.14 of the Act. The -execution court cannot go into that question. The question of personal use does not survive to be considered after the order for eviction became final. The order is a decree fcr all intents and purposes under S.14 of the Act. The -execution court cannot go into that question. The comparative hardship, as envisaged in the proviso to sub-section (10) of S.11 of the Act has already been duly considered. The contention that the transferee is required to prove his bona fide need under the fourth proviso to S.11(3) of the Act, in a case where the landlord transfers his rights after obtaining an order for eviction is not sustainable because the order for eviction in this case was passed under S.11(8) of the Act. Amalgamation is a legal process and cannot be equated with a voluntary transfer. The fourth proviso to S.11(3) of the Act has been enacted to prevent transfers to defeat the object of the Act. But in the case of amalgamation, no such contingency arises. The business continues and the purpose is to continue the existence of the corporate person in this process. Hence the objection raised by the petitioner has been rightly repelled by both the courts. The judgment of this court in C.R.P.No.1319 of 1972 was also challenged before the Supreme Court by filing a Special Leave Petition and the same was dismissed. A suit bearing the number O.S.197 of 1973 was filed on 17-8-1973 by a partner of the firm in the Sub Court, Ernakulam, to prevent the execution of the eviction order. The said suit was dismissed. An appeal was filed before the District Court, Ernakulam as. A.S.70/77 against the order of the Sub Court. That was also dismissed. The orders of the Sub Court and the District Court were confirmed by this Court in S.A.No. 446 of 1980, by judgment dated 28-5-1987. Thereafter, the present execution petition was filed. The petitioners' every attempt to set aside the order for eviction passed by the Rent Control Court, District Court, High Court and the Supreme Court having failed, it is no longer open to him to challenge its validity. 5. Learned counsel for the petitioner's contention is that the first respondent, as a transferee of the premises in question, has no right to execute the decree unless his bonafide need for occupation of the premises is proved. 5. Learned counsel for the petitioner's contention is that the first respondent, as a transferee of the premises in question, has no right to execute the decree unless his bonafide need for occupation of the premises is proved. It is a special Act and a tenant thereunder is protected from eviction under untenable grounds/A decree for eviction obtained by a transferor on the ground of personal need would not entitle a transferee-landlord to put it into execution. On the other hand the contention of the learned counsel for the 1st respondent is that the defence of want of bona fide requirement by the landlord was available only to the deceased statutory tenant, namely, the father of the second petitioner-.Such a plea is not available to his legal representative. 6. The only point that arises for consideration, therefore, is whether the first respondent as a transferee of the ownership of the premises is precluded from executing the decree for eviction which was obtained by the transferor-Bank in the absence of proof that it bona fide needs the building for its occupation as envisaged in the fourth proviso to sub-section (3) of S.11 of the Act. 7. It appears from the order of this Court in C.R.P.No.1319 of 1972 that the Bank of Cochin made an application under S.11(8) of the Act for eviction of the first petitioner-firm' as well as the partner of the firm from the premises which is under the occupation of the petitioners on the ground that it required additional accommodation for its personal use. It was observed as follows: "I do not very much appreciate the plea of the tenant that the revision petitioner in this case cannot take advantage of S.11 of sub-section (8) for the reason that it cannot apply to an artificial person like the Banking Company. This argument is solely for reason of the word "person" in S.11 of the Act. I do not find much force in that submission. I therefore agree with the learned Additional District judge that the revision-petitioner (Bank of Cochin) can avail of the provisions of S.11(8) of the Act. The bonafide need of the landlord for additional accommodation has been found by all the courts," 8. I do not find much force in that submission. I therefore agree with the learned Additional District judge that the revision-petitioner (Bank of Cochin) can avail of the provisions of S.11(8) of the Act. The bonafide need of the landlord for additional accommodation has been found by all the courts," 8. Section 11 of the Act which deals with eviction of tenants states inter alia that notwithstanding anything to the contrary contained in any other law or contract a tenant shall not be evicted, whether in execution of a decree or otherwise, except in accordance with the provisions of this Act. A landlord may apply to the Rent Control Court for an order directing the tenant to put the landlord in possession of the building if he bona fide needs the building for his own occupation or for the occupation by any member of his family dependent on him. Among the provisos to sub-section (3) of S.11 of the Act, that fourth proviso lays down that if a landlord after obtaining an order to be put in possession transfers his rights in respect of the building to another person, the transferee shall not be entitled to be put in possession unless he proves that he bona fideneei- the building for his own occupation or for the occupation by any member of his family dependent on him. Sub-sections (8) and (10) of S.11 of the Act lay down as follows: "(8) A landlord who is occupying only apart of a building, may apply to the Rent Control Court for an order directing any tenant occupying the whole or any portion of the remaining part of the building to put the landlord in possession thereof, if he requires additional accommodation for his personal use. (10) The Rent Control Court shall, if it is satisfied that the claim of the landlord under subsections (3), (4), (7), or sub-section (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." 9. In pursuance of S.45 of the Banking Regulation Act, the Central Government issued the Notification No.F.17/11/85-B.O.III (i) dated 23rd august, 11985 prescribing 26th August, 1985 as the date in relation to the scheme for the amalgamation of the Bank of Cochin Limited with the State Bank of India. A copy of the scheme has been produced as Ext. P3. It is mentioned therein that the Bank of Cochin Limited shall be the transferor Bank and the State Bank of India shall be the transferee Bank. One of the terms and conditions for amalgamation is that "if on the prescribed date any suit, appeal or other legal proceedings of whatever nature by or against the transferor bank is pending, the same shall not abate, or be discontinued or be in any way prejudicially affected, but shall subject to the other provisions of this scheme be prosecuted and enforced by or against the transferee bank." 10. In Shephard v. Union of India, (1987 (2) KLT 707) it was observed by the Supreme Court that the framing of the scheme under S.45 of the Banking Regulation Act, 1949 does not involve a legislative process. It therefore follows that the scheme thereunder has no statutory force. Hence the terms and conditions in the scheme shall be subject to the statutory provisions of the Rent Control Act and no such terms and conditions in the scheme can override the provisions of the Act. 11. It therefore follows that the scheme thereunder has no statutory force. Hence the terms and conditions in the scheme shall be subject to the statutory provisions of the Rent Control Act and no such terms and conditions in the scheme can override the provisions of the Act. 11. Learned counsel for the petitioners contended that the fourth proviso to subsection (3) of S.11 of the Act is an independent provision governing all other provisions relating to eviction of a tenant, and as such unless it is shown that the first respondent as a transferee needs the premises in question bona fide, the order to surrender possession in favour of the transferor Bank cannot be executed. 12. It is now well settled that sub-section (3) and sub-section (8) of S.11 of the Act are not mutually exclusive. But, the question is whether the said proviso to subsection (3) is applicable to sub-section (8). 13. The fourth proviso 'to sub-section (3) of S.11 of the Act restricts the right of the transferee to be put in possession eventhough a decree of eviction has been passed prior to the transfer unless he proves the bona fide need for his occupation. Learned counsel for the petitioners by relying on the decisions in Smt. Dhanwati Devi v. Sri Ram Shankar Prasad & Ors. (1983 (1) RCJ 104); Mohd. Ibrahim v. Rahim Khan(1947 (2) MLJ 419); Shama Banu v. Jagdish Parshad (AIR 1975 Del. 164) and Dwarkanath v. Amarnath (AIR 1957 Nag. 100) has argued that the respondent/ transferee is also required to prove that he too has the bona fide need for occupation of the building. The aforesaid decisions precisely lay down that where the house vests in another, the personal need of the transferor comes to an end. In such a case, his successor cannot be deemed to be his representative for purposes of his need. He cannot, therefore, claim to continue the proceedings on the basis of his predecessor's need. In a later decision in R. Govindraju v. N.G. Venkateswaran (AIR 1972 Madras 346) the Madras High Court dissented from the aforesaid decision in Mohamed Ibrahim's case (1947 (2) MLJ 419). Finally, in P.V. Papanna v, K. Padmanabhaiah (1994 (2) SCC 316) the Supreme Court overruled the decision in Mohamed Ibrahim's case (vide para. 17 of the S.C. Judgment). Thus all those decisions which are in the same lines also stand impliedly overruled. Finally, in P.V. Papanna v, K. Padmanabhaiah (1994 (2) SCC 316) the Supreme Court overruled the decision in Mohamed Ibrahim's case (vide para. 17 of the S.C. Judgment). Thus all those decisions which are in the same lines also stand impliedly overruled. 14. It is evident from the order of this Court in C.R.P.No.1319 of 1972 that the predecessor bank required the premises as an additional accommodation and eviction order was passed under sub-section (8) read with sub-section (1)) of S.11 of the Act. This court in Abdul Rahiman v. Ramankutty Moothan (19S3 KLT 726) held that S.11(8) does not contain the ingredients of S.11(3) and 11(4). Sections 11(3),11(4) (iv) and 11(8) are independent provisions. In all these cases, the requirement should be bona fide. But the nature of the requirement in each section is different. In certain cases, the shades of requirement may overlap. Each section operates independent of the other. A combined order for eviction under S.11(3),11 (4)(iv) and 11(8) cannot be passed. These sections prescribe different post-eviction conditions. Thus in view of the aforesaid decision and the decision in C.R.P.No.1319/1972, it is no longer open to the petitioner-tenant to question the finding that the hardship that may be caused to the tenant by granting eviction will not outweigh the advantage to the landlord and that the fourth proviso to sub-section (3) of S.11 does not govern sub-section (8) thereof of the Act. " 15. In P.V. Papanna v. K. Padmanabhaiah (1994 (2) SCC 316) the facts were as follows. The landlord of anon-residential premises filed an application in the Munsiff Court under S.21(1) of the Karnataka Rent Control Act for recovery of possession of the premises from the tenant-respondent. The trial court allowed the application solely on the ground that the premises were bona fide required by the landlord for his personal use and occupation but granted two years' time to the tenant for handing over the possession. The tenant filed a revision petition before High Court which dismissed the same but granted four years' time to vacate the premises. A special leave petition filed by the tenant was also dismissed by the Supreme Court. However the original landlord died before the period of four years granted by the High Court expired. The tenant filed a revision petition before High Court which dismissed the same but granted four years' time to vacate the premises. A special leave petition filed by the tenant was also dismissed by the Supreme Court. However the original landlord died before the period of four years granted by the High Court expired. The appellants, as legatees under a will made by the deceased and legal representatives, filed an application for execution of the order of eviction in court of Small Causes on failure on the tenant to vacate the premises. Resisting the execution, the tenant contended that the order for eviction having been made solely on the ground of bona fide use and occupation of the premises by the original landlord to carry on a business, it had become ineffective, unenforceable and in executable on his death. The tenant also contended that the order of eviction being personal, it could not be inherited by or assigned in favour of the legal representatives. Overruling the objections the executing court directed issuance of delivery of warrant, taking the view that it could not go behind the decree. But the High Court allowed the revision petition of the tenant, set aside the order of the executing court and dismissed the eviction petition on the grounds that the cause of action did not survive on the death of the landlord and that the legatees, claiming as legal representatives of the deceased landlord, could not execute the decree for eviction which was purely personal. In the background of the aforesaid facts, the Supreme Court while allowing the appeal held as follows: "13. From the various observations made in the cases referred to above, it is patently clear that this Court, while laying down that in a suit for eviction on the ground of bona fide requirement of premises by landlord the subsequent events ought to be taken into account for the purpose of finding out whether the landlord still required the premises in possession of the tenant, has also laid down that such an enquiry can be made so long as the decree for eviction does not become final. In other words, once the matter has become final in the sense that the order of eviction has been upheld by the highest Court in which it was sought to be challenged, it would not be open to further challenge, which necessarily can be in the execution stage. This conclusion inevitably follows from the well-settled principle that a court executing the decree cannot go behind the decree for it is binding and conclusive between the parties to the suit. Therefore, the executing court is required to execute the decree as it finds; save in exceptional cases where the decree on the face of it may be found to be without jurisdiction. To put it differently, the executing court cannot enquire as to why the decree passed but for the purpose of finding out whether the decree is a valid one or a nullity it can go into the question as to whether the court which passed the decree was competent to do so. Besides, the executing court may if need be, look into the pleadings of the parties and the proceedings of the trial, for the limited purpose of construing the decree or the meaning of the words used therein. xx xx xx xx xx 18. For the foregoing discussion, we must hold that events which take place subsequent to the filing of an eviction petition under any Rent Act can be taken into consideration for the purpose of adjudication until a decree is made by the final court determining the rights of the parties but any event that takes place after the decree becomes final cannot be made a ground for reopening the decree. The finality to the dispute culminating in the decree cannot be reopened by the executing court for readjudication on the ground that some event or the other has altered the situation. As a corollary thereto it must also be held that once the decree became final it became a part of the estate of the landlord and therefore the appellants as legal representatives of the deceased landlord are entitled to execute the same." 16. The facts in the present case are similar. The order in C.R.P.No.1319 of 1972 became final with the dismissal of Special Leave Petition by the Supreme Court before the State Bank of India became the transferee Bank. The facts in the present case are similar. The order in C.R.P.No.1319 of 1972 became final with the dismissal of Special Leave Petition by the Supreme Court before the State Bank of India became the transferee Bank. The only difference is that in the present case respondent No.1 is the transferee and in the case before the Supreme Court, the legatees on whom the property devolved stepped into the shoes of the deceased landlord. In Syed Asadullah Kazmi v. Addl. Dist. Judge (AIR 1981 SC 1724), similar observation was made. In that case also, the landlord before obtaining possession in pursuance of an order for eviction of the tenant from apart of premises died. The order for eviction of the tenant had become final by the order of the Supreme Court. It was held that the proceedings which became final after the Supreme Court dismissed the Special Leave Petition of the tenant cannot be reopened. It has been observed as follows: "At is true that subsequent events must be taken into account by a statutory authority or Court when considering proceedings arising out a landlord's petition for ejectment of a tenant on the ground of the landlord's personal need. But in the present case, the order for release of a portion of the accommodation acquired, finality before the death of Raj Kumar Sinha (the landlord) and the controversy concluded by it could not be reopened." 18. It is the settled principle of law that an executing court cannot go behind the decree nor can it question its legality or correctness. But there is one exception to this general rule and that is that where the decree sought to be executed is a nullity for lack of inherent jurisdiction in the court passing it, its invalidity can be setup in execution proceeding. (See - Sunder Dass v. Ram Parkash - AIR 1977 SC 1201). No case has been made out by the petitioners that the decree for eviction is a nullity. This being so the executing court could not have gone behind it and they could not have refused to execute the decree. 19. (See - Sunder Dass v. Ram Parkash - AIR 1977 SC 1201). No case has been made out by the petitioners that the decree for eviction is a nullity. This being so the executing court could not have gone behind it and they could not have refused to execute the decree. 19. In view of what has been laid down by the Supreme Court, it is not open to the petitioners to challenge the right of the first respondent as transferee of the original landlord to execute the decree which has become final and at this stage no court has the jurisdiction to investigate as to whether or not respondent No.1 also has the bona fide need of the premises for its own occupation. 20. The father of the second petitioner became a statutory tenant after the tenancy was determined by service of a notice issued by the erstwhile Cochin Bank. It is contended by the learned counsel for the respondent that the right of a statutory tenant to remain in possession of after the determination of contractual tenancy is personal and on his death his heirs and legal representatives cannot claim the status of a tenant. In considering the provisions of Rajasthan Premises (Control of Rent and Eviction) Act, the Supreme Court in J.C. Chatterjee v. S.K. Tandon (AIR 1972 SC 2526) laid down as follows: "A person remaining in occupation of the premises let to him after the determination of or expiry of the period of the tenancy is commonly, though in law not accurately, called a "statutory tenant". Su< h a person is not a tenant at all; he has no estate or interest in the premises occupied by him. He has merely the protection of the statute in that he cannot be turned out so long as he pays the standard rent and permitted increases, if any, and performs the other conditions of the tenancy. His right to remain in possession after the determination of the contractual tenancy is personal; it is not capable of being transferred or assigned, and devolves on his death only in the manner provided by the statute. On the death of a statutory tenant pending eviction suit or appeal his heirs and legal representatives brought on record cannot claim the status of tenant within S. S(vii) of the Act as no rent is payable by them. On the death of a statutory tenant pending eviction suit or appeal his heirs and legal representatives brought on record cannot claim the status of tenant within S. S(vii) of the Act as no rent is payable by them. If the rent was paid by them during the course of the proceedings it was not because they were recognised as tenants by the landlord but because the amount was received by him without prejudice to his rights under the orders of the court. Therefore, the only contentions that they could put forward in the second appeal by the landlord were the contentions appropriate to their representative character and not one which was personal to the deceased. The defence of want of bona fide requirement by the landlord was personal to the statutory tenant and on his death the same is not open to his legal representatives." But later, the aforesaid proposition was not fully accepted and a dissenting opinion was given by the Supreme Court in Damadilal v. Parashram (AIR 1976 SC 2229). in paragraph 11 of the judgment, the following dictum has been laid down, while considering the provisions of M.P. Accommodation Control Act: "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 it's 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 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". However, irrespective of the fact whether the father of the second petitioner was a statutory tenant or not, in view of the law as laid down in P. V. Pappanna 's case, the first respondent cannot be precluded from executing the decree. Hence interference with the impugned orders is not called for. The petitioners are given one month's time to put the first respondent in possession of the premises in question. 21. For the reason stated above, I find that there is no merit in this writ petition. Hence it is dismissed. No costs.