10 March 2013
Landlords can evict shop tenants: SC Dhananjay Mahapatra, TNN Apr 18, 2008, 03.21am IST
NEW DELHI: For 50 years, tenants in shops and commercial premises in many prime areas of Delhi have had the upper hand over landlords. They lived without fear of eviction and paid a paltry rent as they were protected by laws that froze the amount negotiated decades ago.
This special protection was because the law said that a tenant could be asked to vacate only residential
premises, and not commercial property even if the premises were required for personal use. But all this has changed.
The Supreme Court has given a judgment that would help landlords evict tenants in prime commercial zones like Connaught Place, Karol Bagh, South Extension and Walled City who, in most cases, have been paying a few hundred rupees as rent for decades
he rent law - Delhi Rent Control Act, 1958 - was a handicap for the landlord as he could seek eviction of the tenant only from residential premises, that too provided he proved this was required for his personal need.
The attempts to evict the tenants from the shops had been frustrated for nearly 30 years as the rent law did not permit recovery of the premises let out for shops even on the ground of bonafide personal need.
The court said the restriction on eviction of tenants from commercial premises was inserted in the law 50 years ago mainly because of the limited commercial space available in the city at that time. But that was a long time back.
Now the scenario has undergone a sea change and a fairly large number of buildings and premises were now available on rent for non-residential and commercial purposes. Restricting landlords from seeking eviction of tenants from shops was no longer justified, the Bench said.
The 1995 Delhi Rent Control Act, which had a similar provision in favour of landlords, could not be notified despite receiving presidential assent as the government was pressured by the powerful traders lobby.
Section 14(1)(e) of the 1958 Act allowed a landlord to make an application for recovery of possession of a residential premises on the ground that "the premises let out for residential purposes are required by the landlord for occupation as a residence for himself or any other member of his family dependant on him... and that the landlord has no other reasonably suitable residential accommodation".
The new law would now read: "That the premises are required bonafide by the landlord for himself or for any member of his family dependant on him... and that the landlord has no other reasonably suitable accommodation".
Crucially, the apex court has deleted the word 'residential'. This makes the tenant eviction process apply with same rigour to rented premises - both residential and commercial.
Though the court removed the word 'residential' from Section 14(1)(e) of the Delhi Rent Control Act, it tried to strike a balance by laying down that recovery of rented premises still needed the landlord to prove that he needed it for his use and lacked alternate suitable accommodation.
Reversing a full Bench judgment of the Delhi High Court which had refused to alter the law in favour of the landlords on the ground that it had been in force for more than 45 years, the apex court said the HC failed to see that the provision in the 1958 Act has outlived its utilityriting the 64-page judgment for the Bench, Justice Singhvi said the high court failed to notice the differential treatment in law for residential and commercial premises, even though the rationale for it had long ceased to exist.
Removing this anomaly and striking down the differential approach in law, a Supreme Court bench comprising Justices B N Agrawal and G S Singhvi said landlords could now seek eviction of tenants from residential as well as commercial premises on the ground of proven personal need.
Through the judgment, the court came to the rescue of the family of a landlady who wanted to demolish the premises, part of which was let out for shops. She wanted to build a new structure to accommodate a family growing in size over the years.
10 March 2013
The desired judgment is Satyawati Sharma (Dead) by LRs . v. Union of India and another 2008 (5) SCC 287
It says that Section 14(1)(e) of the 1958 Act is partly struck down. Section 14(1)(e) may read as under :- “that the premises are required bona fide by the landlord for himself or for any member of his family dependent on him, if he is the owner thereof, or for any person for whose benefit the premises are held and that the landlord or such person has no other reasonably suitable accommodation.”