Supreme Court settles eviction of entire premises on subletting of a portion in tenancy dispute: K. Lubna & Ors. vs. Beevi & Ors. (2020) INSC 16

Introduction

Date of the Judgment: 13 January 2020
Citation: (2020) INSC 16
Judges: Sanjay Kishan Kaul, J., K.M. Joseph, J.

Can a tenant be evicted from an entire property if they have sublet only a portion of it? The Supreme Court of India recently addressed this question in a case concerning a tenancy dispute in Kerala. The core issue revolved around the interpretation of the Kerala Buildings (Lease and Rent Control) Act, 1965, specifically whether subletting a part of a tenanted premise warrants eviction from the whole premises. The bench comprised Justices Sanjay Kishan Kaul and K.M. Joseph, who delivered a unanimous decision.

Case Background

In 1967, Pathummakutty, the original owner, leased three shop rooms (numbered 3/471, 3/472, and 3/476) in Kozhikode to Beerankoya for a monthly rent of Rs. 75. The ownership of these properties was transferred to K. Lubna and others (the appellants) in 1986. The appellants notified the original tenant (represented by Beevi and others, the respondents) of this transfer. The respondents allegedly stopped paying rent after November 1987. The appellants claimed they needed the premises for their own use, that the tenant had sublet two of the shops without their consent, and that the value of the shops had been materially reduced. Consequently, the appellants issued a legal notice on December 15, 1987, demanding possession and rent arrears, and subsequently filed an eviction petition.

Timeline

Course of Proceedings

The Rent Control Court in Kozhikode initially ruled in favor of the appellants on the grounds of non-payment of rent, ordering eviction from all three shops. However, the court allowed the tenant to deposit the arrears to avoid eviction, which the tenant did. On appeal, the appellate authority upheld the eviction for two shops (3/472 and 3/476), finding a bona fide need for one and subletting in the other. The High Court of Kerala, in its revision, sustained the eviction order only for Room No. 3/476, based on subletting, while denying eviction for the other two rooms.

Legal Framework

The case primarily revolves around the interpretation of the Kerala Buildings (Lease and Rent Control) Act, 1965. The key provisions are:

• Section 11(4)(i) of the Kerala Buildings (Lease and Rent Control) Act, 1965: This section allows a landlord to seek eviction if the tenant, without consent, transfers their rights or sublets the entire building or any portion thereof, provided the lease does not allow it. The provision states:
  
  “11. Eviction of tenants.—
  xxxxxxxxxxxxxxxxxxxx
  (4) A landlord may apply to the Rent Control Court for an order directing the tenant to put the landlord in possession of the building,—
  (i) if the tenant after the commencement of this Act, without the consent of the landlord, transfers his right under the lease or sub-lets the entire building or any portion thereof if the lease does not confer on him any right to do so:
  Provided that an application under this clause shall not be made for the first time in respect of one and the same tenancy unless the landlord has sent a registered notice to the tenant intimating the contravention of the said condition of the lease and the tenant has failed to terminate the transfer or the sublease as the case may be, within thirty days of the receipt of the notice or the refusal thereof.”
• Section 2(1) of the Kerala Buildings (Lease and Rent Control) Act, 1965: This section defines “building” as any building, hut, or part of a building or hut let separately for residential or non-residential purposes. It states:
  
  “2.Definitions.–In this Act, unless the context otherwise requires,-
  (1) “building” means any building or hut or part of a building or hut let or to be let separately for residential or nonresidential purpose and includes-
  (a) …..
  (b) …..
  (c) …..”

These provisions are crucial in determining the scope of eviction in cases of subletting.

Arguments

Appellants’ Arguments:

• The appellants contended that there was a single tenancy for all three shop rooms, even though the violations differed for each portion.
• They argued that the notice dated 15.12.1987 was a composite notice for the entire premises, and the eviction petition was also filed for the whole premises.
• Relying on Section 11(4)(i) of the Kerala Buildings (Lease and Rent Control) Act, 1965, the appellants argued that subletting any portion of the premises allows for eviction from the entire premises.

Respondents’ Arguments:

• The respondents argued that the plea for eviction of the entire premises based on subletting a portion was not raised in the lower courts and thus should not be considered by the Supreme Court.
• They contended that since they had accepted the High Court’s judgment, which ordered eviction from only one shop (3/476), they should not be subjected to eviction from the entire premises.

The appellants’ main argument was that the legal consequence of subletting a portion of a single tenancy is the eviction from the entire premises, even if the subletting occurred in only one part. The respondents, on the other hand, argued against the consideration of this new legal argument at the Supreme Court stage, claiming it was not raised earlier.

Issues Framed by the Supreme Court

The Supreme Court framed the following issue for consideration:

1. Whether, under Section 11(4)(i) of the Kerala Buildings (Lease and Rent Control) Act, 1965, subletting a portion of a tenanted premises allows for the eviction of the entire premises.

Treatment of the Issue by the Court

Authorities

The Supreme Court considered the following authorities:

Judgment

How each authority was viewed by the Court?

• The Court followed the ratio in M. Meeramytheen & Ors. v. K. Parameswaran Pillai & Ors. [2010] 15 SCC 359, which dealt with a similar issue under the same Act.
• The Court interpreted Section 11(4)(i) of the Kerala Buildings (Lease and Rent Control) Act, 1965 to mean that subletting any portion of the premises allows for eviction of the entire premises.
• The Court relied on Yeswant Deorao Deshmukh v. Walchand Ramchand Kothari [1950] SCR 852, Chittoori Subbanna v. Kudappa Subbanna AIR 1965 SC 1325, and Connecticut Fire Insurance Co. v. Kavanagh [1892] A.C. 473 to justify the examination of a pure question of law at the Supreme Court stage.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the clear language of Section 11(4)(i) of the Kerala Buildings (Lease and Rent Control) Act, 1965, and the legal precedent set by the case of M. Meeramytheen & Ors. v. K. Parameswaran Pillai & Ors. [2010] 15 SCC 359. The Court emphasized that the statute explicitly states that subletting “any portion” of the premises is a ground for eviction from the entire building. The Court also noted that the existence of a single tenancy was not disputed, and a single notice and eviction petition were filed for the entire premises. The Court also took into consideration that the plea was taken as an additional ground and the respondents did not file any cross appeal or cross objection.

The Court’s reasoning was primarily based on the legal interpretation of the statute and the application of the precedent. The factual aspects of the case were considered, but the legal principles weighed more heavily in the decision.

The Court considered alternative interpretations, but rejected them based on the clear language of the statute and the binding precedent. The decision was reached by applying the legal principles to the undisputed facts of the case. The Court stated:

“A bare reading of sub-para (i) of sub-section (4) of Section 11 of the said Act leaves no manner of doubt that the cause arises upon the tenant transferring his rights under a lease and sub-lets the entire building “or any portion thereof”, if the lease does not confer on him any right to do so.”

“Thus, sub-letting of any part of the tenanted premises gives right to eviction from the whole premises. That is how the statute reads and that is also, in our opinion, a reasonable interpretation of the same, as, if one tenancy is created it would not be appropriate to pass eviction order only in respect of a part thereof, and not the whole.”

“Thus, the appellant is not expected to allege sub-letting of the whole premises if the sub-letting is only in part of the premises. No doubt the appellants have not specifically claimed that by sub-letting a portion, the whole premises is liable to be vacated, but then that is the legal consequence as is emerging from the legal position.”

There were no dissenting opinions in this case. The court was unanimous in its decision.

Key Takeaways

• Subletting any portion of a tenanted premises can lead to the eviction of the entire premises.
• Landlords must send a registered notice to the tenant intimating the contravention of the lease condition.
• Tenants must terminate the transfer or sublease within thirty days of receiving the notice to avoid eviction.
• This judgment clarifies the legal position under the Kerala Buildings (Lease and Rent Control) Act, 1965, and will likely impact future tenancy disputes in Kerala.

Directions

The Supreme Court granted the respondents six months’ time to vacate the entire premises.

Specific Amendments Analysis

Not Applicable

Development of Law

The ratio decidendi of the case is that under Section 11(4)(i) of the Kerala Buildings (Lease and Rent Control) Act, 1965, subletting any portion of a tenanted premises allows for the eviction of the entire premises. This judgment reinforces the strict interpretation of the statute and clarifies the legal consequences of subletting in Kerala. It also establishes that the legal consequences of subletting a portion of the premises is eviction from the entire premises, even if the landlord did not specifically claim such a relief.

Conclusion

The Supreme Court allowed the appeals, ruling that subletting a portion of a tenanted premises warrants eviction from the entire premises. The Court emphasized the clear language of Section 11(4)(i) of the Kerala Buildings (Lease and Rent Control) Act, 1965, and followed the precedent set in M. Meeramytheen & Ors. v. K. Parameswaran Pillai & Ors. [2010] 15 SCC 359. The respondents were granted six months to vacate the premises. This judgment provides clarity on the issue of subletting and its consequences under the relevant Act.