‘Your Lordship’ comes to the rescue of landlords

[dropcap]T[/dropcap]HE Supreme Court recently reaffirmed landlords’ right to evict tenants from the non-residential property. It upheld its previous decision in Satyawati Sharma vs. Union of India, allowing landlords to file eviction petitions on grounds of bona fide need for non-residential premises. The decision of the top court was pronounced in the case of Vinod Kumar vs. Ashok Kumar Gandhi, which has a very important bearing upon the eviction petitions filed in Delhi.

The top court was dealing with Section 14 (1)(e) of the Delhi Rent Control Act, 1958, which allows landlords to file eviction petitions for bonafide need for residential premises only.

In Satyawati Sharma case, the court had ruled that the section was unconstitutional. It maintained that the section violated the doctrine of equality as it made an unnecessary classification between residential and non-residential premises, preventing the rights of landlords to seek eviction for bonafide reasons.

The legislature provided for this distinction considering the situations that existed at the time when the act was promulgated. Uprooted by the partition, tenants needed such protection by restricting the rights of the landlord to recover possession, in order to settle down. However, with time, the latent discrimination present in such distinction has become unreasonable, arbitrary, and hence unconstitutional the court observed relying on another judgment of Delhi High Court.


Amounting to Judicial Legislation


It was the case of the petitioners that the court’s decision in Satyawati Sharma amounted to judicial legislation, and was per incuriam as it was contrary to the previous judgments of the Supreme Court on the same issue.

The petitioners argued that the intention of the legislature with regard to maintaining this distinction was made quite clear on several occasion. It was also shown in the summary procedure for eviction provided in section 25B of the same Act. As mandated, the said procedure was available only for residential purposes.

Such a distinction was also acknowledged by the Constitutional bench of Supreme Court in the case of Gian Devi Anand vs. Jeevan Kumar and others.

“The Legislature itself treats commercial tenancy differently from a residential tenancy in the matter of the 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,” the court had noted.

However, the court in the same case had also suggested that the legislature may consider getting rid of the said distinction.

“The legislature having not yet enforced the Delhi Rent Act, 1995 (which makes no distinction between residential and non-residential premises) it was not open for this court in Satyawati Sharma to read down the provision of Section 14(1)(e),” the petitioners contended. The judgment of the Supreme Court in Satyawati Sharma was, thus, per incuriam and needed to be reconsidered.

However, rejecting the contentions, the court held that the decision in Satyawati Sharma was not per incuriam as it only carried forward what was suggested in Gian Devi Anand’s case. It was not called upon the court to consider the constitutionality of section 14 (1) (e) in Gian Devi Anand’s case as in the case of Satyawati Sharma, the court observed.

Further, what was observed in Gian Devi Anand’s case was also accepted by the Legislature in providing for eviction from both the residential and non-residential premises on the ground of bona fide need in Delhi Rent Control, Act 1995. “Although, said Act could not be enforced, the Legislation is complete when the Act is passed by the Legislature and receives the assent of the President,” the court held.


‘Traditional interpretation must give way to changing situations’


The decision of the Supreme Court is interesting for more than one reason. It not only has an impact on the rights of the tenants but also seeks to place tenants on an equal footing as the landlords, a position that has traditionally not been favoured by the court.

“There has been a definite shift in the court’s approach while interpreting the rent control legislations. An analysis of the judgements of the 1950s to early 1990s would indicate that in the majority of cases the courts heavily leaned in favour of an interpretation which would benefit the tenant. However, a different trend is clearly discernible in the later judgments,” Justice Singvi had observed in Satyawati Sharma’s case.

Section 14(1)(e) was introduced by the legislature taking into account the conditions that had prevailed at the time, post the partition. Observing that the times have changed, the court held that a reasonable and balanced approach be adopted “while interpreting rent control legislations, starting with an assumption that an equal treatment has been meted out to both the sections of the society.”

However, even though the court underscored the need for a shift in interpreting rent control legislations, it did so without consideration of any empirical data. “In Satywati Sharma’s case, it was argued that there is no empirical data to substantiate as to how the situation has changed,” an expert pointed out.

“The court also failed to consider the essential difference in positions of a landlord and a tenant with regard to their livelihood. The livelihood of a landlord is at all times ensured (at least partly) by the rent paid by the tenant whereas the business carried on by a tenant may be her only source of livelihood,” he said. “Therefore, adopting an equal approach and allowing the landlord to recover possession for bonafide need might affect the tenants disproportionately and leave them vulnerable.”