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PETITIONER: D. SATYANARAYANA

       Vs.

RESPONDENT: P. JAGADISH

DATE OF JUDGMENT15/09/1987

BENCH: SEN, A.P. (J) BENCH: SEN, A.P. (J) RAY, B.C. (J)

CITATION:  1987 AIR 2192            1988 SCR  (1) 145  1987 SCC  (4) 424        JT 1987 (3)   571  1987 SCALE  (2)577  CITATOR INFO :  D          1990 SC 636  (6,11)

ACT:      Andhra Pradesh  Buildings (Lease,  Rent  and  Eviction) Control Act, 1960: s. 10(2)(i) & (vi)-Sub-tenant-Eviction of by tenant-No  finding regarding  bonafides of  dispute as to title-Sub-tenant attorns to and paying rent to the landlord- order of eviction-Validity of.      Evidence Act,1872  : s. 116-Rule of estoppel-sub-tenant under threat  of  eviction  by  title  paramount-Attorns  to landlord-Whether estopped  from denying  tenant’s  title  in eviction proceedings by tenant.

HEADNOTE:      The  appellant   was  a   sub-tenant  of   the  tenant- respondent. The  landlord served a notice of eviction on him in  November,   1980  alleging   that  there   was  unlawful subletting by  the respondent  and that  he had  decided  to terminate the  tenancy with  the expiry  of that  month. The appellant thereupon  attorned  in  favour  of  the  landlord agreeing to  pay him  the rent.  After becoming  the  direct tenant, the appellant stopped paying rent to the respondent.      The respondent  asserting to  be the  lessor  commenced proceedings for  eviction of the appellant under s. 10(2)(i) and  (vi)   and  s.  10(3)(b)(iii)  of  the  Andhra  Pradesh Buildings (Lease, Rent and Eviction) Act, 1960 on the ground that the appellant was in wilful default in payment of rent, that there was denial of title on appellant’s part, and that he required the premises bona fide for his use. F      The Rent  Controller disallowed  the application on the ground that  the respondent  not being a lessor had no locus standi to  initiate the  proceedings-for eviction. The first appellate court, however, directed eviction of the appellant under s.  10(2)(i) and  (vi), holding  that in  view of  the denial of respondent’s title as well as non-payment of rent, the appellant  was estopped from denying the title. The High Court having  upheld this  view, the  appellant appealed  to this Court by special leave.      Allowing the appeal, ^      HELD: 1.  There could  be no  order of  termination  in

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terms of s. H 146      10(2)(i) of  the Andhra  Pradesh Buildings (Lease, Rent and Eviction)  Control Act  unless it  could be said that in the facts  and circumstances  of the  case the dispute as to title was  not bona  fide. In  the instant case, there is no such finding  by the  High Court. Furthermore, the appellant could not  be treated  to be in arrears of rent since he has been paying rent to the head lessor. Therefore, the order of eviction passed against  the appellant under s. 10(2)(i) and (vi) of the Act is not sustainable in law. [151G; 152B]      2.1 The  rule of  estoppel embodied under s. 116 of the Evidence Act  is  that  a  tenant  who  has  been  let  into possession  cannot   deny  his   landlord’s  title   at  the commencement of  the tenancy,  however, defective it may be, so  long  as  he  has  not  openly  restored  possession  by surrender to  his landlord.  During the  continuance of  the tenancy,  the   tenant  cannot  acquire  by  prescription  a permanent right of occupancy in derogation of the landlord’s title by  mere assertion of such a right to the knowledge of the landlord.  The words  ’during the  continuation  of  the tenancy’ occurring  in s.  116  of  the  Evidence  Act  mean "during the  continuance of the possession that was received under the tenancy in question." The rule of estoppel is thus restricted not  only in  extent  but  also  in  time,  i.e., restricted to  the title  of the  landlord  and  during  the continuance of the tenancy. [149E-F; C-D]      2.2 The  general rule  of estoppel  under  s.  116  is, however, subject to certain exceptions, in that, a tenant is not precluded  from denying  the  derivative  title  of  the persons  claiming  through  the  landlord.  Similarly,  such estoppel is  restricted to  the denial  of the  title at the commencement of  the tenancy,  it is open to the tenant even without surrendering  possession to show that since the date of tenancy  the title of the landlord came to an end or that he was  evicted by  a paramount  title holder  or that  even though there  was no  actual eviction  or dispossession from the property,  under a threat of eviction he had attorned to the paramount title-holder. [149G-H; 150A-B]      2.3 In  order to constitute eviction by title paramount it is  not necessary  that the tenant should be dispossessed or even  that there  should be  a suit  of ejectment against him. It  will be  sufficient if there was threat of eviction and if  the tenant as a result of such threat attorns to the real owner,  he can  set up  such eviction by way of defence either to  an action  for rent or to a suit in ejectment. If the tenant,  however, gives up possession voluntarily to the title-holder, he cannot claim the benefit of this rule. When the  tenancy  has  been  determined  by  eviction  by  title paramount, no  question of  estoppel arises  under s. 116 of the Evidence 147 Act. The  principle must  equally apply  when the tenant has attorned under  a threat  of eviction by the title paramount and there  comes into  existence a new jural relationship of landlord and tenant as between them. [150B-D]      In the instant case, having regard to the fact that the appellant  was   under  threat  of  eviction  by  the  title paramount, it cannot be said that the rule of estoppel under s. 116 of the Evidence Act applied and therefore, he was not entitled  to   dispute  the   title   of   the   respondent. Furthermore, the  appellant having,  after being served with the notice  of eviction,  attorned to the head lessor, there came into existence a direct tenancy. [151H; 152A-B]      Bilas Kunwar  v. Desraj  Ranjit Singh,  ILR (1915) All.

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557 (PC); Atyam Veerraju & ors. v. Pechetti Venkanna & Ors., [1966] 1  SCR 831;  Kumar Krishna  Prosad Lal  Singha Deo v. Baraboni Coal  Concern Limited  & ors.,  AIR  1937  PC  251; Adyanath Ghatak  v. Krishna  Prasad Singh & Anr., AIR (1949) PC 124;  27Halsbury’s Laws  of England,  4th Edn., pars 238; Mangat Ram  & Anr. v. Sardar Meharban Singh & ors., [1987] 1 Scale 964,  Fide Hussain v. Fazal Hussain & ors., AIR (1963) MP 232;  K.S.M. Curuswamy  Nadar v.  N.G.  Ranganathan,  AIR (1954) Mad,  402; S.A.A.  Annamalai Chettiar  v. Molaiyan  & ors.,  AIR   (1970)  Mad.   396  and   Chidambara  Vinayagar Devasthanam v.  Duraiswamy, ILR  (1967) 1 Mad. 624, referred to,

JUDGMENT:      CIVIL APPELLATE  JURISDICTION: Civil Appeal No. 2223 of 1987.      From the  Judgment and  order dated  21.8.1986  of  the Andhra Pradesh High Court in C.R.P. No. 1518 of 1985.      A.K. Ganguli and A. Mariarputham for the Appellant.      G. Narasimhulu for the Respondent.      The Judgment of the Court was delivered by      SEN, J.  This appeal  by special leave brought from the judgment and order of the High Court of Andhra Pradesh dated August 21, 1986 raises a question of general importance. The High Court  has upheld the judgment of the Chief Judge, City Small Causes  Court  dated  April  29,  1985  directing  the eviction of the appellant from the demised premises under s. 10(2)(vi) of the Andhra Pradesh Buildings (Lease, Rent 148 & Eviction)  Control Act,  1960. The question is whether the appellant was  estopped from denying the title of the lessor under s. 116 of the Evidence Act, 1872 despite the fact that there was  threat of  eviction by  the owner  of the demised premises one  Krishnamurthy i.e.  the  person  having  title paramount.      There is  no material  point of  fact which  is now  in dispute. The  demised premises  which is  a removable wooden cabin or kiosk located at one corner of a building belonging to one  Krishnamurthy was let out on a rent of Rs. 6 per day which later  was increased  to Rs.  10, by the respondent P. Jagadish, son  of the  original tenant  P.R.N. Upadhyaya  on March 9,  1977.  Admittedly,  the  main  premises  i.e.  the building was  demised by  Krishnamurthy to  the said  P.R.N. Upadhyaya in  the year  1972 and  in course  of time  he had sublet different  portions  of  the  premises  to  different persons. By  a notice dated November 8, 1980 the head lessor Krishnamurthy served  a notice  of eviction on the appellant and other  sub-tenants  alleging  that  there  was  unlawful subletting  by  the  lessee  and  that  he  had  decided  to terminate the  tenancy of  the  tenant  Upadhyaya  with  the expiry of  that month  i.e. by  the end  of  December  1980. Thereupon, the appellant on December 4, 1980 was constrained to attorn  in favour  of the  original lessor  Krishnamurthy agreeing to  pay him  a rent of Rs.300 per month. Evidently, the appellant had paid rent to the respondent upto March 31, 1980. After  becoming a  direct tenant under the head lessor Krishnamurthy, the  appellant stopped  paying  rent  to  the respondent w.e.f.  April 1,  1980. On  March  13,  1981  the respondent asserting  to be the lessor commenced proceedings for eviction  of the  appellant from  the  demised  premises under s. 10(2)(i) and (vi) and 10(3)(b)(iii) of the Act i.e. On the  ground that  the appellant  was in wilful default in payment of  rent, that there was denial of title on his part

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and for his bona fide requirement. The First Additional Rent Controller,  Hyderabad  by  order  dated  November  3,  1982 disallowed the application on the ground that the respondent not being  the lessor  had no  locus standi  to initiate the proceedings for  eviction. On  appeal, the Chief Judge, City Small Causes  Court, Hyderabad  by judgment  dated April 29, 1985 reversed  the order  of the learned Rent Controller and directed the eviction of the appellant under s. 10(2)(i) and (vi) holding  that the  premises in  question was a building within s.  2(iii) of  the Act and that in view of the denial of his  title as  well as  admitted non-payment of rent, the appellant was estopped from denying the title. That decision of his has been upheld by a learned Single Judge of the High Court by the judgment under appeal. The judgment of the High Court mainly rests on the rule of estoppel. 149      The appeal  must be  allowed on  the short  ground that there being  a threat of eviction by a person claiming title paramount i.e.  head lessor Krishnamurthy, the appellant was not  estopped   under  s.  116  of  the  Evidence  Act  from challenging the title and his right to maintain the eviction proceedings of  the respondent P. Jagadish as the lessor. S. 116 of the Evidence Act provides that no tenant of immovable property shall,  during the  continuance of  the tenancy, be permitted to  deny that  the landlord of such tenant had, at the beginning  of the  tenancy, a  title to  such  immovable property.  Possession   and  permission  being  established, estoppel would bind the tenant during the continuance of the tenancy and  until he  surrenders his  possession. The words "during  the   continuance  of   the  tenancy"   have   been interpreted to mean during the continuance of the possession that was  received under  the tenancy  in question,  and the Courts have repeatedly laid down that estoppel operates even after the  termination of  the tenancy  so that a tenant who had been  let into possession, however, defective it may be, so long  as he has not openly surrendered possession, cannot dispute the title of the landlord at the commencement of the tenancy. The rule of estoppel is thus restricted not only in extent but  also in time i.e. restricted to the title of the landlord and  during the  continuance of the tenancy; and by necessary implication,  it follows  that  a  tenant  is  not estopped, when  he is  under threat of eviction by the title paramount, from  contending that  the landlord  had no title before the  tenancy commenced  or  that  the  title  of  the landlord has since come to an end.      The rule  of estoppel  embodied under  s.  116  of  the Evidence Act  is that,  a  tenant  who  has  been  let  into possession  cannot   deny  his   landlord’s  title,  however defective it  may be,  so long as he has not openly restored possession  by   surrender  to   his  landlord.  During  the continuance of  the tenancy,  the tenant  cannot acquire  by prescription a permanent right of occupancy in derogation of the landlord’s  title by  mere assertion  of such a right to the knowledge  of the  landlord. See:  Bilas Kumar v. Desraj Ranjit Singh ILR (1915) 37 All 557 (PC) and Atyam Veerraju & Ors. v.  Pechetti Venkanna  & ors.,  [19661 1  SCR 83 1. The general rule  is however subject to certain exceptions. Thus a tenant  is not precluded from denying the derivative title of the  persons claiming  through the  landlord. See:  Kumar Krishna Prosad  Lal Singha  Deo  v.  Baraboni  Coal  Concern Limited &  orS., AIR  (1937) PC 251. Similarly, the estoppel under s. 116 of the Evidence Act is restricted to the denial of the  title at the commencement of the tenancy. From this, the exception  follows, that  it is  open to the tenant even without surrendering  possession to show that since the date

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of the tenancy, the 150 title of  the landlord came to an end or that he was evicted by a  A paramount title holder or that even though there was no actual eviction or dispossession from the property, under a threat of eviction he had attorned to the paramount title- holder. In  order to constitute eviction by title paramount, it has  been established  by decisions  in  England  and  in India, that  it is  not necessary  that the tenant should be dispossessed  or  even  that  there  should  be  a  suit  in ejectment against  him. It  will be  sufficient if there was threat of  eviction and  if the  tenant as  a result of such threat attorns  to the  real  owner,  he  can  set  up  such eviction by  way of  defence either to an action for rent or to a  suit in  ejecment. If  the  tenant  however  gives  up possession voluntarily  to the title-holder, he cannot claim the  benefit  of  this  rule.  When  the  tenancy  has  been determined by  eviction by  title paramount,  no question of estoppel arises  under s.  116 of  the  Evidence  Act.  See: Adyanath Chatak  v. Krishna  Prasad Singh & Anr., AIR (1949) PC 124. The principle must equally apply when the tenant has attorned under  a threat  of eviction by the title paramount and there  comes into  existence a new jural relationship of landlord and tenant as between them. The law is stated in 27 Halsbury’s Laws of England, 4th edn., para 238:           "238. Eviction  under title paramount. In order to           constitute an  eviction by a person claiming under           title para  mount, it  is not  necessary that  the           tenant should  be put  out of  possession, or that           proceedings  should   be  brought.   A  threat  of           eviction is  sufficient, and  if  the  tenant,  in           consequence  of   that  threat,   attorns  to  the           claimant, he may set this up as an eviction by way           of defence  to an  action for rent, subject to his           proving the evictor’s title. There is no eviction,           however,  if   the  tenant   gives  up  possession           voluntarily. " Quite recently,  this Court  in Mangat  Ram & Anr. v. Sardar Meharban Singh  & ors.,  [1987] 1 Scale 964, to which one of us was a party, observed:           "The estoppel contemplated by s. 116 is restricted           to the  denial of title at the commencement of the           tenancy and  by  implication  it  follows  that  a           tenant is  not estopped  from contending  that the           title of the lessor has since come to an end.      See also:  Fida Hussain  v. Fazal  Hussain &  Ors., AIR (1963) MP  232, K.S.M.  Guruswamy Nadar v. N.G. Ranganathan, AIR (1954) Mad. 151 402, S.A.A.  Annamalai Chettiar  v.  Molaiyan  &  Ors.,  AIR (1970) Mad.  396 and  Chidambara  Vinayagar  Devasthanam  v. Duraiswamy, ILR (1967) 1 Mad. 624.      In the  premises, the High Court as well as the learned Chief Judge  of the  City Small Causes Court were clearly in error in  allowing the proceedings brought by the respondent under s. 10(2)(i) and (vi) of the Act by relying on the rule of estoppel  embodied in  s. 116  of the  Evidence Act.  The judgment of  the High  Court cannot  be  sustained  for  the reason that there is no finding that the dispute as to title was not  bona fide  in terms  of  s.  10(2)(i)  and  further inasmuch as  the appellant  could not  be treated  to be  in arrears of  rent since  he has  been paying rent to the head lessor Krishnamurthy  after the attornment of the tenancy to him. The  terms of  s. 10(2)(i)  and (vi) of the Act are set out below:

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         " 10.  Eviction of tenant-(2) A landlord who seeks           to evict  his tenant shall apply to the Controller           for a direction in that behalf. If the Controller,           after giving  the tenant  a reasonable opportunity           of  showing  cause  against  the  application,  is           satisfied-                (i) that  the tenant has not paid or tendered                the  rent  due  by  him  in  respect  of  the                building within fifteen days after the expiry                of the time fixed in the agreement of tenancy                with his  landlord or  in the  absence of any                such agreement,  by the last day of the month                next following  that for  which the  rent  is                payable, or                (vi) that  the tenant has denied the title of                the landlord  or claimed a right of permanent                tenancy and that such denial or claim was not                bona fide.           the Controller  shall make  an order directing the           tenant to  put the  landlord in  possession of the           building  and   if  the   Controller  is   not  so           satisfied, he  shall make  an order  rejecting the           application."      The High Court failed to appreciate that there could be no order  of termination  in terms  of s. 10(2)(i) unless it could be  said that  in the  facts and  circumstances of the case the dispute as to title was not bona fide. It cannot be said having  regard to the fact that the appellant was under threat of  eviction by the title paramount, that the rule of estop- 152 pel under  s. 116  of the Evidence Act applied and therefore he was  not entitled to dispute the title of the respondent. Furthermore, the  appellant having on December 4, 1980 after being served  with the  notice of  eviction attorned  to the head lessor,  there came into existence a direct tenancy. It has been  brought to our notice that the appellant has since that  date   been  paying   rent  to   his  present   lessor Krishnamurthy and  is not  in arrears  of rent. The order of eviction passed  by the  learned Chief  Judge as well as the High Court  against the appellant under s. 10(2)(i) and (vi) of the Act is not sustainable in law.      In the  result, the appeal succeeds and is allowed. The proceedings for  eviction of  the appellant from the demised premises under s. 10(2)(i) and (vi) and 10(3)(b)(iii) of the Andhra Pradesh  Buildings (Lease, Rent and Eviction) Control Act, 1960 are quashed. No costs. P.S.S.                                       Appeal allowed. 153