Court’s Decision
The Division Bench of the Delhi High Court held that the benefit of Section 14(1)(e) of the Delhi Rent Control Act, 1958 — which allows eviction based on bona fide requirement — is available not only to natural persons but also to non-natural persons such as companies, public institutions, registered societies, and trusts, provided they qualify as landlords under Section 2(e) of the Act.
The Court ruled:
“The definition of landlord provided under Section 2(e) of the Act is quite wide and takes within its ambit even a non-natural person.”
It concluded that:
“Landlords who require premises for their bona fide requirements are all fully covered under Section 14(1)(e) of the DRC, 1958.”
Facts
The reference before the Court arose from 12 eviction petitions filed by various landlords — including private limited companies, public trusts, and registered societies — under Section 14(1)(e) read with Section 25B of the Delhi Rent Control Act, 1958, seeking possession of tenanted premises based on bona fide requirement.
The tenants challenged the eviction orders passed by the Rent Controller and filed revision petitions. These matters raised common legal questions and were referred to the Division Bench by a Single Judge for authoritative determination.
Issues
- Whether companies or juristic persons can invoke Section 14(1)(e) of the DRC Act for eviction.
- Whether Section 22 is the exclusive provision applicable to non-natural persons.
- Whether directors or office-bearers of companies/public bodies are considered “employees” under Section 22.
- Whether the use of premises for commercial/industrial activities is within the scope of Section 22 or 14(1)(e).
- Whether public charitable trusts and temple deities are public institutions under Section 22.
- Whether allowing landlords to choose between Section 14(1)(e) and 22 is prejudicial to tenants.
Petitioners’ Arguments
- Section 14(1)(e) is meant only for natural persons.
- The use of the words “he” and “himself” in the provision signifies individual landlord.
- Juristic entities should invoke Section 22, not Section 14(1)(e).
- Section 25B’s summary procedure is meant for individual landlords, not companies or public bodies.
- Allowing juristic entities to use Section 14(1)(e) would render Section 22 otiose.
- Private trusts are not covered under Section 22 and hence may invoke Section 14(1)(e).
Respondents’ Arguments
- The term “landlord” under Section 2(e) includes juristic persons.
- Section 3(42) of the General Clauses Act defines “person” to include companies and bodies corporate.
- Section 22 is not the only remedy for juristic persons; Section 14(1)(e) is also available.
- The remedies under Sections 14 and 22 are not mutually exclusive.
- Summary procedure under Section 25B is not limited to individuals.
Analysis of the Law
- Section 2(e) of the DRC Act defines “landlord” broadly to include any person entitled to receive rent — including trustees, guardians, and receivers — without restricting it to natural persons.
- Section 14(1)(e) does not restrict the class of landlords who can seek eviction; it only focuses on bona fide requirement.
- Section 13 of the General Clauses Act makes it clear that words importing the masculine gender include females — and, by extension, are not restrictive in application to natural persons.
- Section 22 is not an exclusive remedy. The Court held that multiple remedies can coexist, and landlords can choose the appropriate provision based on their factual situation.
- The term “public institution” under Section 22 includes libraries, hospitals, and educational institutions but excludes institutions set up by private trusts.
- The summary procedure under Section 25B is applicable to eviction petitions under Sections 14(1)(e), 14A, 14B, 14C, and 14D, not under Section 22.
Precedent Analysis
- Satyawati Sharma v. Union of India (2008) 5 SCC 287: Expanded the scope of Section 14(1)(e) to include commercial premises.
- Bank of India v. Lekhimoni Das (2000) 3 SCC 640: Recognized that co-existing remedies can be available under law.
- Sultana Begum v. Prem Chand Jain (1997) 1 SCC 373: Applied harmonious construction to avoid rendering any statutory provision otiose.
Court’s Reasoning
- Section 14(1)(e) must be read in harmony with Section 2(e), which includes both natural and non-natural landlords.
- The use of masculine pronouns in Section 14(1)(e) is not restrictive and must be interpreted in line with Section 13 of the General Clauses Act.
- Excluding juristic persons from Section 14(1)(e) would leave many such landlords without remedy, especially where Section 22 is inapplicable.
- Section 22 is a special provision available in certain factual scenarios but does not bar the use of Section 14(1)(e).
- The remedies under Sections 14 and 22 can coexist, and choice of remedy lies with the landlord.
Conclusion
The Delhi High Court conclusively held that:
“Section 14(1)(e) of the DRC, 1958 would apply to all landlords including non-natural persons, such as companies, societies, trusts, etc., provided that the requirement of bona fide need is established.”
Accordingly, the Court answered the reference questions in favour of allowing juristic landlords to invoke Section 14(1)(e).
Implications
- Juristic entities such as companies, public trusts, and societies can now legitimately seek eviction under Section 14(1)(e) on grounds of bona fide requirement.
- The summary procedure under Section 25B is also available to such landlords.
- The decision offers clarity on the coexistence of remedies under Sections 14 and 22 and provides flexibility to landlords.
- The judgment will impact numerous pending eviction proceedings involving non-natural landlords.