Geeta N. Shivdasani vs Niraj T. Sharma and Others

Mohta Anoop V., J.—Heard finally. The petitioner has challenged the concurrent findings and orders based upon the same passed by the authorities under the Maharashtra Rent Control Act, 1999 (MRC Act), whereby she has been directed to hand over the vacant and peaceful possession of residential premises i.e. Flat No. 406, Yeshwant Co-operative Housing Society Limited, Juhu-Versova Link Road, Andheri (West), Mumbai-400 053, to the respondent/original applicant and further directed to pay the damages at the rate of Rs. 30,800/- per month from 1.2.2006 till handing over of possession.

The respondent/applicant has initiated eviction proceedings u/s 24 of MRC Act on account of failure of petitioner to vacate the same after expiry of licence period. The parties have led evidence. The issues were framed. After considering the material as well as evidence led by the parties, the Competent Authority has held that the petitioner is licensee and the respondent is licensor; the licence period expired; the petitioner not co-operated in registration of the agreement and, therefore, ordered to give vacant possession of the premises. It is also held that the petitioner/licensee failed to prove that she is in possession of the suit premises in a capacity other than the licensee.

The Additional Commissioner being Revisional Authority, u/s 44 of the MRC Act has re-considered and confirmed the order of Competent Authority in all respect.

Once the licence period is expired, the licensee considering the scheme of MRC Act, 1999 need to give vacant possession if demanded by the licensor. The licence agreement that itself binds the parties. The licensee thereafter cannot claim right of tenancy based upon the leave and licence agreement dated 1.4.2004 in question. There is no material and evidence to justify about creation of any tenancy. Mere acceptance of some amount after expiry of the said licence period which in fact was the arrears of rent that itself cannot create any agreement of tenancy. The licensor is bound to accept the payments which are due and payable by the licensee based upon the said agreement, as admittedly, after expiry of the licence period, the petitioner/licensee is in occupation of the said flat though directed to vacate. The exclusive possession of the suit premises based upon such agreement that itself cannot create any tenancy in view of the specific provisions of MRC Act and the agreement in question. The security deposit also cannot be the foundation to claim any tenancy rights.

Another service agreement which was executed towards dues of furniture and fixtures in the suit premises, the list of furniture and fixture is enclosed with the Leave and licence agreement. Both the parties are fully aware of the nature and purpose of this agreement. This service agreement is basically only after main leave and licence agreement to use and enjoy the fixture and furniture. This service agreement in no way creates any right and /or tenancy in favour of the licensee in the premises in question.

Though there is no reference in Leave and licence agreement about this service agreement, but service agreement it is clearly mentioned that it is co-extensive with the Leave and Licence agreement. Therefore, if leave and licence agreement is expired and licensee still retains the possession and enjoy the fixture and furniture that itself cannot be the reason to accept the case of use of tenancy and/or of any rights in the premises and on fixture and furniture.

In view of above, even direction to appropriate the amount of security deposit of Rs. 1,00,000/- (Rupees one lac only) towards arrears of damages as ordered by the Competent Authority is also within the frame work of law and the record.

The submission that Leave and licence agreement was not registered at the relevant time, but it was registered on later stage unilaterally is also in no way sufficient to disturb the reasoning given by the Courts below that licensee/petitioner/original respondent was not cooperated in the registration of the agreement, therefore, need to get it registered. This Court while dealing with this aspect in Raj Prasanna Kondur Vs. Arif Taher Khan and Others, , while interpreting the MRC Act, the same provisions, rightly held that non-registration of agreement will not affect the rights of licensor/landlord/owner to seek eviction of licensee on expiry of licence period. The delay in presenting the agreement for registration also will not come in the way of Competent Authority in taking cognizance of such application filed by the licensor/landlord. The agreed terms and conditions of such agreement, specially when the parties have acted upon the same just cannot be overlooked. The section itself provides the effect in case of non registration. It in no way affects the right of the landlord/licensor to initiate or move for an eviction and recovery of the possession of the premises.

The applicant/respondent/licensor terminated the licence through notice dated 18.5.2006 and asked the petitioner to vacate the premises by 18.06.2005 as needed the premises urgently for his personal use. The said notice was replied by the petitioner and resisted and claimed tenancy in the suit premises. The period of licence expired on 31.01.2006. Now, therefore, as rightly observed, there is no point in considering that facet with regard to the notice of termination of tenancy. There is nothing in the agreement to show that the licensor/owner cannot issue such notice of terminating the tenancy if he requires the property/ flat for personal use.

The Apex Court in Carona Ltd. Vs. Parvathy Swaminathan and Sons, , referring to the MRC Act has observed as under:

It is already seen from the Statement of Objects and Reasons that the object of the Act is not merely, to protect tenants but also to provide fair returns to the landlords and to encourage housing activity so as to augment rental housing in the form of construction of buildings and letting them out. It is also meant to legitimise the pagadi or premium system which was prohibited earlier. Thus the Act has been enacted in order to strike a balance between the interests of landlords and tenants and for giving a boost to house building activity and in doing so the legislature in its wisdom has decided and thought it fit not to extend the protection of the Rent Act to certain class of tenants like multinationals scheduled banks, public sector undertakings and private and public limited companies having share capital of more than Rs. 1 crore. This is essentially a matter of legislative policy

Having entered into the premises on, terms and conditions of the Leave and licence Agreement, such licensee now cannot be permitted to turn around and claim tenancy right over the premises. This frustrates the scheme and object of the MRC Act.

The terms and conditions of the agreement are binding on the parties. It is not only the issue about entitlement of licence fee/use and occupation charges; compensation but depriving of the possession of the premises by the licensor/landlord/owner though the period of agreement is expired. All tactical moves of the tenant/licensee are only to delay the proceeding and to retain the possession of the premises unauthorisedly.

In so far as the use and occupation charges at the rate of Rs. 30,800/- per month from the date of expiry of the licence period i.e. from 1.2.2006 till handing over of vacant possession subject to adjustment of security deposit of Rs. 1,00,000/- also need no interference. Admittedly, the petitioner has agreed to pay Rs. 5400/- per month towards the compensation and Rs. 10,000/-for using fixture and furniture of the premises though by separate agreement in the year 2005. It is specifically agreed that in case of default in payment without prejudice to their rights, interest at 24% p.a. will attract. However, considering the present demand and cost of property and as though demanded not vacated the premises as needed for personal use, the award of such damages for illegal use and occupation after expiry of the period also need no interference.

Therefore, taking all this into account, I see there is no case made out to interfere with the reasoned orders passed by both the Competent Authorities.

The petition is, therefore, dismissed.

The learned Counsel for the petitioner seeks stay of this order. Considering the contention as raised and in view of ensuing vacation, the effect and operation of this order is stayed for six weeks.