Tenant Cannot Force Landlord to Run Business From Another Shop: Supreme Court Restores Eviction for Boutique

Tenant Claimed 80-Year-Old Landlady Could Not Start a Business; Supreme Court Upholds Her Bona Fide Requirement and Orders Eviction

Facts

Kamla Devi filed an eviction petition against her tenant under Section 13 of the East Punjab Urban Rent Restriction Act, 1949.

Eviction was sought on two grounds:

Non-payment of rent; and
Bona fide requirement of the shop for Kamla Devi and her son, Madan Mohan.

Both Kamla Devi and Madan Mohan died during the prolonged litigation. Their legal representatives continued the proceedings. The tenant also died, and his legal representatives contested the appeal.

The landlord-tenant relationship was undisputed. The monthly rent was ₹112.50.

Non-Payment of Rent

The tenant submitted that on 3 June 2003, he tendered:

Rent from 17 July 1998 to 9 June 2003;
₹1,000 as interest; and
₹1,100 as costs.

The total tendered amount was ₹8,740, which was accepted. The Rent Controller consequently decided the arrears issue in the tenant’s favour.

Bona Fide Requirement

The tenant denied the alleged bona fide requirement and argued that:

Kamla Devi was approximately 80 years old and was unlikely to start a business;
The litigation was allegedly being pursued at the instance of her other son, Adarsh Mohan;
Another shop was available to the landlord’s family;
One shop had been rented out by Adarsh Mohan; and
A third shop was lying vacant or was being used for storage.

On 27 May 2010, the Rent Controller at Nabha found the bona fide requirement proved. It directed the tenant to hand over possession within three months.

The Rent Controller found that:

The shop was genuinely required by the landlady and Madan Mohan;
They did not possess any other suitable non-residential premises within Nabha;
They had not vacated any other non-residential premises after the Rent Act came into force; and
The eviction petition was maintainable.

The tenant appealed.

On 6 January 2011, the Appellate Authority at Patiala upheld the eviction order.

It observed that although Kamla Devi had died during the proceedings and her personal requirement no longer survived, the eviction petition had also been based upon the requirement of her son, Madan Mohan. His requirement continued to exist.

The tenant then approached the Punjab and Haryana High Court.

On 6 August 2018, the High Court reversed the concurrent findings and set aside the eviction order.

The High Court held that Kamla Devi had not approached the court with clean hands because she had allegedly concealed the existence of a third shop. It also found that the lower authorities had incorrectly treated the third shop as a storage space used by Adarsh Mohan.

The landlord’s legal representatives challenged this decision before the Supreme Court.

Issues

Whether the landlord had established a genuine and bona fide requirement for the tenanted shop.
Whether the existence of another shop being used for storage defeated the landlord’s claim.
Whether the tenant or the court could compel the landlord to use alternative accommodation instead of the tenanted shop.
Whether the son’s requirement survived after the death of the original landlady.
Whether the High Court exceeded its revisional jurisdiction by reassessing evidence and reversing concurrent factual findings.

Appellants’ Arguments

The landlord’s legal representatives argued that the Rent Controller and Appellate Authority had concurrently found the requirement genuine after examining the evidence.

The shop was required for the family to operate a boutique. The existence of another shop being used for storage did not make the requirement dishonest or artificial.

Once the need was found genuine, it was for the landlord to decide which accommodation was best suited for the proposed business. The tenant could not dictate that another shop should be used.

The High Court had exceeded its limited revisional jurisdiction by reappreciating the evidence and substituting its own factual conclusions for those of the Rent Controller and Appellate Authority.

Respondents’ Arguments

The judgment does not record detailed oral submissions from the tenant’s side. The Supreme Court appointed an amicus curiae to assist on behalf of the tenant.

The tenant’s case before the lower courts was that:

The claim of personal requirement was illusory;
It was improbable that an 80-year-old landlady intended to operate a business;
Another shop was available;
The existence and availability of the third shop had not been properly disclosed; and
The landlord had failed to approach the court with clean hands.

The tenant also relied upon the fact that the complete rent arrears, interest and costs had already been tendered and accepted.

Analysis of the Law

Purpose of Rent-Control Legislation

The Supreme Court explained that rent-control laws were enacted as social-welfare legislation to protect tenants from exploitation in periods of housing scarcity.

However, such legislation must balance:

The tenant’s protection against arbitrary eviction; and
The landlord’s legitimate right to use and enjoy their own property.

The tenant’s protection cannot be treated as absolute or used to defeat a genuine requirement established by the landlord.

Meaning of Bona Fide Requirement

“Bona fide” means in good faith. A bona fide requirement must be:

Natural;
Real;
Sincere;
Honest; and
More than a mere desire, whim or pretext to remove the tenant.

The court must objectively assess whether the need claimed by the landlord is genuine.

However, once the requirement is proved, the landlord’s subjective choice of suitable accommodation must ordinarily be respected.

The court cannot insist that the landlord use another property merely because it considers that property more convenient.

Alternative Accommodation

The Supreme Court found that the third shop was being used for storage or keeping waste material.

Even if this position was accepted, it did not justify rejection of the eviction claim. The landlord was entitled to continue using that shop as a storage space and choose the tenanted premises for running the boutique.

The availability of some other premises does not automatically defeat a bona fide requirement. Suitability must be considered from the landlord’s practical perspective.

Revisional Jurisdiction

The revisional power of the High Court under Section 115 of the Code of Civil Procedure is limited.

The High Court may interfere where:

The subordinate court exercised jurisdiction not vested in it;
It failed to exercise jurisdiction legally vested in it;
There was procedural illegality or material irregularity;
Relevant evidence was completely ignored; or
The findings were perverse.

The High Court cannot function as a first appellate court or reassess the entire evidence merely because another view is possible.

The Rent Controller and Appellate Authority had passed reasoned orders and concurrently found the requirement genuine. No perversity or jurisdictional error was established.

Precedent Analysis

Ram Krishan Grover v. Union of India

The Supreme Court explained that rent-control statutes were enacted to protect tenants from exploitation but must also balance the legitimate interests of landlords.

The judgment referred to Malpe Vishwanath Acharya v. State of Maharashtra, Joginder Pal v. Naval Kishore Behal, Satyawati Sharma v. Union of India and Vinod Kumar v. Ashok Kumar Gandhi on the need for such balance.

Shiv Sarup Gupta v. Mahesh Chand Gupta

The Court held that a bona fide requirement must reflect a genuine, honest and sincere need rather than a mere desire or pretext.

Once that need is proved, the court should respect the landlord’s choice between different available premises and should not impose its own preference.

Baldev Singh Bajwa v. Monish Saini

This judgment reiterated that a landlord’s requirement must contain both:

A subjective desire to possess the premises; and
An objective element of genuine need.

The Court referred to Bega Begum v. Abdul Ahad Khan, Surjit Singh Kalra v. Union of India and Ram Dass v. Ishwar Chander.

Masjid Kacha Tank, Nahan v. Tuffail Mohammed

The Supreme Court held that the High Court cannot reappreciate evidence or reverse concurrent factual findings under Section 115 merely because another view is possible.

Hindustan Petroleum Corporation Limited v. Dilbahar Singh

The Constitution Bench held that revisional jurisdiction cannot be equated with first-appellate jurisdiction.

A revisional court may examine jurisdictional errors, procedural illegality and irregularity but cannot freely reconsider every factual question.

Ambadas Khanduji Shinde v. Ashok Sadashiv Mamurkar

The Supreme Court held that the High Court cannot interfere with concurrent factual findings in a landlord-tenant dispute unless the error goes to the root of jurisdiction.

Court’s Reasoning

The Supreme Court found that the High Court had erred on both the substantive issue of bona fide requirement and the scope of revisional jurisdiction.

The following factors were decisive:

The requirement had been pleaded for both Kamla Devi and Madan Mohan.
Although Kamla Devi died during the proceedings, the requirement attached to Madan Mohan survived.
The Rent Controller and Appellate Authority had concurrently found the requirement genuine.
The family intended to use the tenanted shop for running a boutique.
The alleged third shop was being used for storage or keeping waste material.
There was nothing legally improper about continuing to use that shop for storage.
The court could not compel the landlord to shift the proposed boutique to another shop.
Once a genuine need was proved, the landlord’s choice of accommodation had to be respected.
The High Court had reassessed the evidence and substituted its own factual view without identifying perversity, non-consideration of material evidence or jurisdictional error.
Such reappreciation was beyond the permissible scope of revisional jurisdiction.

The Supreme Court consequently restored the concurrent findings of the Rent Controller and Appellate Authority.

Conclusion

The Supreme Court allowed the landlord’s appeal and set aside the Punjab and Haryana High Court judgment dated 6 August 2018.

It restored:

The Rent Controller’s eviction order dated 27 May 2010; and
The Appellate Authority’s judgment dated 6 January 2011.

The tenant’s legal representatives were directed to deliver vacant and peaceful possession of the shop to the landlord’s legal representatives within two months from the date of the judgment.

There was no order as to costs.

Case Details

Case: Madan Mohan (Dead) Through Legal Representatives v. Thakar Dass (Dead) Through Legal Representatives, 2026 Indian Supreme Court 730
Court: Supreme Court of India
Case Number: Civil Appeal of 2026 arising out of Special Leave Petition (Civil) Number 12435 of 2019; the Civil Appeal number is not specified in the judgment
Judges: Justice Sanjay Karol and Justice Augustine George Masih
Date: 21 July 2026
Result: Appeal allowed; High Court judgment set aside, eviction restored and tenant directed to hand over vacant possession within two months.