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Tenant legal heirs not right as tenant after the decree

(Querist) 20 December 2018 This query is : Resolved 
A compromise Decree between Landlord and Tenant in the court and tenant want time 1 year for vacate the shop. Then compromise submit in the court and court passed the decree. In compromise tenant confirm he vacate the shop after 1 year. After 9 month tenant die.
1.Tenant legal heirs file a new civil suit and challenge the compromise decree on the ground that compromise was not lawful.
2. File Objection under section 47 in the execution court and execution court reject the objection of tenant legal heirs and passed order for vacate the shop to the ameen. Ameen can not vacate the shop and submit the report in the court that required the police force for vacate the shop. Execution court order to S.P. and ask for 1 days police fee. S.P. Office given detail of Rs. 11000/- for 1 days police fee. After that tenant take a long date 2 month.
3. Tenant legal heirs file revision in District Court which dismissed by the district court.
4. After that Tenant legal heirs said he have no knowledge about the compromise and again file new objection under section 47 and 151 in execution court. Tenant legal heirs want cancel the compromise decree and deemed as tenant in place of original tenant.

My question you to
1. Tenant legal heirs no right to file again raise new objection under section 47 and 151.
2. Tenancy end with compromise decree of the court. Compromise between landlord and original tenant.

Please provide the latest High court Allahbad & Suprme Court rulling for the above question

Rajeev Gupta
Raj Kumar Makkad (Expert) 17 March 2020
The reply has already been submitted by you and do endorse both the replies.


Judgment reserved on 10.12.2007
Judgment delivered on 29.2.2008


Deo Narayan Jaiswal vs. Special Judge (E.C. Act) and others

Hon'ble Sunil Ambwani, J.

Heard Shri R.S. Misra and Shri Arun Kumar Mishra, learned counsels for the petitioner-landlord and Shri P.K. Jain, Senior Advocate assisted by Shri Amitabh Agarwal for the respondent-tenant.
Shri Deo Narayan Jaiswal-the landlord of the shop in dispute at Malviya Road, Deoria, filed a Suit No.7 of 1988 for ejectment & arrears of rent from 1.2.1986 to 20.6.1988, with interest of Rs. 10,868.25; water tax of Rs. 1687.32 and house tax of Rs.137.50 per month for use and occupation upto 21.6.1988, and Rs. 375/- per month as mesne profits w.e.f. 21.6.1988. It was alleged that the shop was newly constructed in 1979, and thus the provisions of U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act 1972, (In short, the Act) are not attracted. The defendant is a tenant @ Rs. 375/- per month. He carries on the business of selling medicines in the shop. The tenant did not pay the rent, inspite of demand since February 1986; made considerable damage to the shop and has sublet the shop to Shri Bindeshwari Mall son of Shri Ram Surat Mall without petitioner's permission. The landlord also claimed the possession of the shop for his bonafide need and stated that the notice of demand of arrears of rent and ejectment was sent on 13.5.1988 by registered post through his counsel was served by refusal on 20.5.1988.
In the written statement, the defendants alleged that Shri Kaushal Nandan was the owner of the shop and some more properties adjacent to the shop. The plaintiff had purchased the property from Shri Kaushla Nand. At that time late Bhim Raj, father of the defendants, was the tenant. Earlier the plaintiff had filed a Suit No. 83 of 1977, Deo Narayan vs. Bhim Raj for ejectment in Judge Small Causes Court in which parties entered into a compromise under which Bihari Lal, Murari Lal, Purshottam Lal, Moti Lal and Vinod Kumar, all sons of Bhim Raj, were accepted as tenant of the shop. The new construction of the shop was to begin on 15.11.1978 and to be completed upto 15.2.1979. The rent at the old rate was to be paid until the constructions were complete. The landlord was not given any right under the compromise to increase the rent in future. The landlord was required to get the house cleaned and repaired annually. The defendants are occupying the shop as old tenants and that provisions of UP Act No. 13 of 1973 are fully applicable to the shop. The landlord had received the rent upto 17.1.1986 vide receipt No. 41 and started putting pressure on the defendants to increase the rent. He refused to accept the rent after February 1986. The rent for the period 1.2.1986 to 28.2.1987 was sent by money order. The landlord refused to accept it, on which the rent was deposited in his favour under Section 30 of the Act. The defendants denied that they had damaged the shop or have sublet it to any person. Shri Vindeshwari Mall is not the sub-tenant.
The Judge Small Causes Court dismissed the suit on 2.4.1998, with the findings that the shop was constructed in the year 1979, and the suit was filed on 21.7.1988. The provisions of the Act were not applicable to the shop. It found that the landlord did not accept the rent upto January 1986 and that the defendant has deposited the rent under Section 30 of the Act. After the plaintiff refused to accept the rent by money order, there was no default in payment of rent. Further, the tenant deposited Rs.17100/- under Section 20 (4) of the Act on 22.2.1989. The defendant did not damage the shop and has not allowed any sub tenant to occupy it. The shop was not assessed for water tax and thus the water tax is not payable. All the tenants have not been impleaded as parties to the suit and that under clause-4 of the compromise deed, the landlord had agreed not to increase the rent in future.
Aggrieved the petitioner-landlord filed SCC Revision No. 7 of 1998. The Special Judge (EC Act) Court No. 5 Deoria heard and dismissed the revision on 20.9.2001, confirming the findings of the trial court. The revisional court upheld the findings that under the terms of the compromise deed even after new constructions the old tenancy was allowed to continue and that when the rent was tendered by the money order from 1.2.1986 to 28.2.1987 and was refused, the tenant deposited the rent under Section 30 of the Act. The provisions of Section 20 (4) of the Act saves the tenancy from forfeiture and serves the object of Section 114 of Transfer of Property Act. The tenant had deposited the entire arrears of rent with interest and cost under Section 20 (4) of the Act and was entitled to the benefit of saving his tenancy.
On the interpretation of the terms of the compromise the revisional court held that the parties agreed that the old tenancy will continue and the landlord would not have the right to evict the tenant unless he defaults for payment of rent. The default in payment of rent however was not proved.
While admitting the writ petition filed in the year 2002, on 28.11.2006, this Court by an interim order had enhanced the rent. Shri Suresh Chandra Jaiswal-the tenant filed a Special Leave to Appeal (Civil) No. 2467 of 2007. Issuing notice Hon'ble Supreme Court stayed the order:-
"Learned counsel for the petitioner has submitted that the suit filed by the landlord for arrears of rent and eviction was dismissed in revision by the IV Additional District Judge, Aligarh, by the order dated 25.5.2002. Thereafter, the landlord has filed a Writ Petition in the High Court challenging the order of learned IV Additional District Judge and while admitting the said writ petition, the High Court has enhanced the rent from Rs. 100/- to Rs. 2000/- with effect from 1.9.2006 and has issued a direction for deposit of the entire arrears of rent within a period of two months. It has also been directed that in case of default of payment of arrears of rent, landlord can get the disputed premises vacated with the help of police force. Learned counsel has submitted that in a case where an order of eviction or release is passed against a tenant and he files a writ petition and makes a prayer for staying the order of release or eviction passed against him, the High Court can direct the tenant to deposit a higher amount as rent as a condition for grant of a stay order. However, in the present case, the order under challenge in the writ petition, is in favour of the tenant and the landlord has assailed the correctness of the same. In such circumstances, it is urged, the rent cannot be enhanced to the extent to which it has been done by the High Court. Learned counsel has also referred to an order passed by us on 21.1.2006 in S.L.P. (C) No. 18453/2006 (Niyaz Ahmad Khan v. Mahmood Rahmatullah Khan & anr.) where this Court in similar circumstances stayed the order passed by the High Court.
Issue notice.
Meanwhile, the impugned order dated 29.8.2006 passed by the High Court by which the petitioner has been directed to pay rent at the rate of Rs. 2000/- p.m. with effect from 1.9.2006 is stayed. It is made clear that the petitioner shall continue to pay or deposit the rent at the rate at which he was doing earlier. It is further made clear that this order will not come in the way of the High Court to hear and decide the writ petition expeditiously."

The matter could not be heard by the Hon'ble Judge, who had passed the order increasing the rate for sometime and with the change in determination of the benches, it was listed and was heard on 7.12.2007 and 10.12.2007.
Shri R.S. Misra, learned counsel for the petitioner-landlord submits that both the courts below have misinterpreted terms of the compromise between the plaintiff-landlord late Shri Bhim Raj Agarwal-the tenant and the father of Shri Moti Lal-respondent No. 3, in Suit No. 83 of 1977. In this compromise, which is binding upon the tenant-respondent no. 3, the parties had agreed that out of 13 respondents impleaded after the death of Bhimraj, only defendant Nos. 1/4, and 1/7 to 1/10 namely Bihari Lal; Murari Lal; Purshottam; Moti Lal and Vinod Kumar would remain as tenants and the defendants have no concern with the tenancy. The rent for the period 29.4.1974 to 30.9.1978 was paid by defendant nos. 1/4 and 1/7 to 1/10 and that the landlord would be entitled to withdraw the rent deposited under Section 30 of the Act. Paragraph-4 of the compromise deed is relevant for the purposes of the case. In this paragraph it was agreed by the parties that the house purchased by the landlord of which disputed shop is the part, is in dilapidated condition which needs to be repaired, and that the landlord needs to construct a house on the first floor. The parties agreed that the landlord will get the house demolished and reconstructed for which the tenants are agreeable and will have no objection. The plan is annexed with the compromise. Clause 4(a) provides that after demolition the landlord will get the constructions made afresh from the beginning and would construct for defendant nos. 1/4 and 1/7 to 1/10 a shop measuring 12'x9" east-west and 30' long north-south with walls at the height of 12' with shutter and linter upto 15.2.1979.
In clause-4(b) of the compromise it was agreed that the new constructions will start from 15.11.1978 for which the defendants will give to the plaintiff-landlord all cooperation and while continuing their rights as old tenants they would go on vacating the parts of the disputed shop without any objections. In clause-4 (c) it was agreed that after reconstructions the rent would be payable at Rs. 375/- per month and if the rent is not paid for four months, the tenant can evict in accordance with the law. Until fresh constructions are made, the tenancy would continue @ Rs. 10.94 per month. The new constructions will not affect on the old tenancy except the terms and conditions of the compromise deed. In clause-4 (d) the parties agreed that in case there is any obstruction in the constructions on account of non-cooperation of the defendants, and the constructions are not complete, the defendants will still be liable to pay Rs. 375/- per month w.e.f. 16.2.1976 and if there is any delay, the defendant Nos. 1/4 and 1/7 to 1/10 will be entitled to damages @ Rs. 20/- per day for the period they are not able to use the shop. Further the defendants will also be entitled to damages and costs, if they are dispossessed during the period of constructions. The landlord was not made entitled to any increase of rent in future and took upon himself annual cleaning and repairs of the shop. The other terms of the compromise are not relevant for the purposes of this case.
Shri R.S. Misra submits that with this compromise the tenants permitted and that the landlord re-constructed the entire shop. The fresh tenancy would thus begin from the date of reconstruction of the shop @ Rs. 375/- per month. He submits that the parties could not have agreed to continue the old tenancy in the newly constructed shop with the revised rent. The shop was reconstructed in February 1979 and that the suit was filed within ten years during which the provisions of the Act would not apply. Section 2 (2) of the Act exempts the building from the provisions of the Act for a period of ten years from the date of constructions for which a deeming provision is made in Explanation 1 (a) of the Act. Sub section 2(2) of Section 2 of the Act includes any new constructions in place of an existing building which has been wholly or substantially demolished. The petitioner-landlord did not refuse to accept the rent sent by the money order and that the tenant was not entitled to protection of Section 20 (4) of the Act. According to Shri R.S. Mishra, the suit filed within ten years of the new constructions would continue to be governed, as the Act would not apply to the newly constructed building or that with the default committed in payment of rent even under the terms of compromise and the termination of tenancy by a valid notice the petitioner-tenant was entitled to a decree of arrears of rent and eviction.
Shri R.S. Mishra has relied upon judgments in Lal Chandra and another vs. District Judge, Agra and others 1999 (2) ARC 678 (SC) (para 14) in submitting, that under the new Act of 1972, Section 24 (2) states that, 'whenever a landlord obtains a building for demolition or reconstruction and follows a particular procedure for release, it will be open to the erstwhile statutory tenant to apply to the competent authority to allow him to re-occupy the newly constructed premises, with the same rights of statutory tenancy. But, there is no similar provision like sub clause (2) of Section 24 in the old Act. Indeed, even as per the new Act, a case of an agreement entered into voluntarily for demolition and re-induction, does not fall under Section 24 (2). The result is that once the building stood demolished before 1970 by an agreement, the statutory rights of the tenant came to an end as there was no provision of the old Act which provided for continuance of any rights of statutory tenancy, in a situation and voluntary surrender and full reconstruction of the premises'.
Shri Mishra has further placed reliance upon Ram Dularey Gupta vs. State of UP 1981 ARC 47 (para-3), in which a Division Bench of this Court held that it is not necessary to enter into a controversy whether there was an agreement between the parties for demolition and letting out one shop of the building to the old tenant. The act would not apply to the new constructions so newly made. Section 24 is not applicable because the new construction was not made after obtaining an order for demolition and release under Section 21, but under an alleged private arrangements. Thus the authorities had no power whatsoever to allot the newly constructed building to the respondent. The allotment was made in anticipation of the constructions being made. Shri Mishra has also relied upon judgment in case of Hukumat Rai vs. District and Sessions Judge Haridwar and others 1995 AWC (1) 334 in submitting that two things are necessary before the provisions of sub section (g) of Section 111 of the Transfer of Property Act can come into operation; firstly, there should be an express condition in the lease for payment of rent, and secondly there should be a clause for re-entry in the case of default of payment of rent. He submits that in Nutan Kumar and others vs. IInd Additional District Judge and others 2002 (2) ARC 645 (SC) the occupation of a house without allotment makes a person trespasser and liable for ejectment and in Anish Ahmad vs. Special Judge/Additional district Judge Saharanpur and others, 1997 (2) ARC 32 it was held that mere acceptance of rent after service of notice is not indicative of the waiver of the notice of eviction.
Shri P.K. Jain, Senior Advocate, on the other hand, would submit that the parties had agreed, in the compromise deed accepted by the Court in suit No. 83 of 1977 that the tenancy would be governed by the Act. Clause 4 (b) of the compromise provided that the tenant would not vacate the premises during the period when new constructions are raised. They will go on vacating the premises gradually without any objection and cooperate in fresh constructions. The rent would be paid at the old rate of Rs. 10.95 per month till the new constructions are made and would then be increased to Rs. 375/- per month. Clause 4 (c) of the compromise clearly provided that the new constructions would not affect the old tenancy except for the terms and conditions agreed between the parties under the compromise. Shri Jain submits that the parties could, by a compromise, agree that the provisions of the rent act would apply to the newly constructed shop, even if a new tenancy had begun with the increase of rent from the date of completion of the new constructions. He submits that the courts below have not committed any error in holding that the Act applied and had allowed the benefit of Section 20 (4) of the Act to the tenant. He would submit that even otherwise there was no default in payment of rent as the landlord had refused to accept the money order on which the rent was deposited under Section 30 of the Act as a valid tender to the landlord.
Shri P.K. Jain has relied upon Lachoo Mal vs. Radhye Shyam AIR 1971 SC 2213 in which the Supreme Court, almost in similar case, found that an agreement providing for reconstruction and re-delivery of the possession to the tenant is a valid agreement. No question of policy much less public policy could arise to hold that the agreement is violative of Section 23 of the Contract Act. It was held:-
"Where during the tenancy governed by Rent Control Act the landlord in 1962 entered into an agreement by which tenant was to vacate premises for reconstruction and landlord was to redeliver same after reconstruction, no question of policy, much less public policy, could arise. The landlord can waive the exemption benefit available for constructions made after 1.1.1951. The agreement is neither illegal nor unlawful nor defeating provisions of any law within meaning of Section 23 of Contract Act."

In Imtiaz Hussain vs. IVth Additional District Judge 1997 ARC (1) 519, the Court examined the relationship between the parties after reconstructions of the shop. It was held that the landlord by accepting the rent from the petitioner at the same rate during the period of constructions and further in allowing them to carry on their business from the open land in front of their shop clearly admitted that the same relationship continued throughout. If the relationship was the same, the petitioners may be entitled for benefit of the Act. The Court then relied upon the preamble of the Act where for regulation of letting and rent and eviction the Act provides for interest in general public in respect of certain classes of buildings situated in urban areas and for matters connected therewith.
In Byram Pestonji Gariwala vs. Union of India AIR 1991 SC 2234, the Supreme Court held that a consent decree is binding upon the parties. If the compromise is not vitiated by fraud, misrepresentation, misunderstanding or mistake, the decree passed thereon has the binding force of res judicata. In para 43 of the report the Supreme Court held " a judgment by consent is intended to stop litigation between the parties, just as a judgment resulting from a decision of the Court, at the end of a long drawn out fight. The compromise decree creates an estoppel by judgement."
The father of respondent no. 3 was the tenant of the shop in dispute. After its purchase the landlord wanted to reconstruct the building and also to add new constructions on the first floor for his residence. After the death of the landlord his sons and daughters and his widow became tenants. They all agreed that only defendant no. 1/4 and 1/7 to 1/10 would be the tenants and allowed the landlord by a compromise to reconstruct the building. The disputed shop was in a portion of the building. The agreement stipulated that the tenants will continue to pay the rent at the old rate until the constructions were complete and the newly constructed shop is occupied by them, after which they will pay Rs. 375/- per month. The agreement clearly stipulated that the tenants would permit the landlord and cooperate with him to make new constructions and will gradually vacate the shops during the course of constructions. It was further agreed in clause-4 (c) of the agreement which was accepted by the Court that rate of rent at Rs. 375/- will be payable after the shop is reconstructed and if the four month's rent is not paid the tenant can be evicted in accordance with the law. Until the construction of the shop the rate of rent would be Rs. 10.95 per month and that new constructions will not affect the tenancy except the written terms of the compromise.
The judgments, orders and awards by consent have always been held to be no less efficacious than the judgments, orders or decisions. Order XXIII Rule 3 CPC provides for a compromise of suit. Where it is proved to the satisfaction of the Court that a suit has been decided wholly or in part by any lawful agreement or compromise in writing and signed by the parties or where the defendants satisfy to plaintiff in respect of the whole or any part of the subject matter of suit, the court shall order such agreement, compromise or satisfaction to be recorded and shall pass a decree in accordance therewith as it relates to the parties to the suit, whether or not the subject matter of the agreement, compromise or satisfaction, is the same as the subject matter of suit. The explanation to Rule 3 states that an agreement or compromise, which is void or voidable under the Indian Contract Act 1872 shall be deemed to be lawful within the meaning of the Rule.
In the present case, both the parties took advantage under the compromise. It was accepted by the Court and has become final and that terms of the contract, on which earlier suit was settled, would operate as estoppel between the parties in the subsequent suit.
If the agreement or compromise is not lawful and is voidable, the affected party may avoid the same by raising objections to its acceptance or by filing a suit and may avoid the agreement if the compromise is void. In order to prove that the agreement is void, it has to be established that either the parties were not competent to contract, there was no consideration, or that the agreement is void under Section 23 of the Contract Act. In the present case the agreement, to allow the landlord to reconstruct the shop without dispossessing the tenant and thereafter letting out the same to the tenant on a higher rate protecting his right and tenancy under the Act, would not make the object of the agreement for unlawful. The UP Act No. 13 of 1972 does not forbid such an agreement and that such agreement would not defeat the provision of any law. The object or consideration of such agreement is not unlawful. The Act provides for exemption of building which has not completed ten years from the date of its construction. The parties can, however, by an agreement, provide that even in such a case where the building has been reconstructed the tenant will continue to be treated as tenant under the Act.
In the present case we are concerned with the benefit of Section 20 (4) of the Act which provides for unconditional deposit of entire arrears of rent and damages with interest @ 9% per month and costs of the suit to avoid a decree of eviction and to relieve the tenant against his liability of eviction on the ground of default. Sub section (5) of Section 20 provides as follows:

"20 (5) Nothing in this section shall affect the power of the Court to pass a decree on the basis of an agreement, compromise or satisfaction recorded under Rule 3 of Order XXIII of the First Schedule to the Code of Civil Procedure 1908".

In this case the landlord in lieu of the permission given by the tenant and with a condition of increase of rent, allowed tenant to continue to have same rights as he would have otherwise got with his old tenancy under the Act. In Lachoo Mals case it was held that such an contract would not violate any policy much less public policy for holding that the agreement was void under Section 23 of the Indian Contract Act. The agreement as such was a valid agreement.
The landlord has drawn benefits under the compromise. He cannot be permitted now to dispossess the tenant except at any of the grounds given under the UP Act No. 13 of 1972. With the compromise in Suit No. 83 of 1977 between the parties the landlord got benefit of reconstruction of the shop and also added first floor for his own residence. He also got benefit of increase of rent from Rs. 10.49 to Rs. 375/- per month. The landlord is therefore estopped from alleging that the terms of the same agreement would not benefit the tenant. The principle of estoppel serve equity, justice and good conscious. Having taking benefit under the compromise the landlord is estopped from alleging that the agreement is void, and would not give the tenant the protection of the Act to the extent.
The writ petition is dismissed.

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