Case Note & Summary
The dispute arose from two cross-suits concerning the occupancy status of a room in a bungalow known as 'Carmel View' at 63, Mount Carmel Road, Bandra (West), Bombay. The respondent, the owner, filed L.E. & C. Suit No. 86/116 of 1979 for possession of one room adjoining the kitchen on the ground floor and for arrears of paying guest charges and mesne profits, contending that the appellant was a paying guest from February/March 1971 at Rs. 120 per month, later increased to Rs. 200 per month, and that the permission to occupy was revoked by notice dated 2.11.1978. The appellant filed R.A.D. Suit No. 2041 of 1979 for a declaration that he was a tenant of the bathroom. The appellant claimed that he was in exclusive possession of bedroom No. 3, dining hall, bathroom and pantry as a tenant, that the letter dated 31.1.1974 admitting paying guest status was obtained under pressure, and that the respondent had informed the Bombay Municipal Corporation in tax assessment proceedings that the appellant was a tenant. The Trial Court by common judgment dated 27/28-6-1989 decreed the appellant's suit and dismissed the respondent's suit, holding that the appellant was a tenant from the beginning. The Appellate Bench of the Small Causes Court, Bandra, allowed both appeals by the respondent by judgment dated 25-6-1994, finding that the appellant was a paying guest, that the dining hall and kitchen etc. and other bedrooms were in the control of the respondent, and that the letter dated 31.1.1974 was binding. The High Court dismissed the appellant's writ petitions on 22-4-1997. The Supreme Court considered whether the appellant was a paying guest or a tenant under the Bombay Rents, Hotel and Lodging House Rates (Control) Act, 1947. The Court examined the definitions of 'landlord' in section 5(3), 'licensee' in section 5(4A), 'paying guest' in section 5(6A), 'premises' in section 5(B), and 'tenant' in section 5(11), and section 15A dealing with deemed tenancy. The Court held that a paying guest is excluded from the definition of licensee, and that under section 5(6A), the requirement that the licensor resides 'in which the licensor resides' qualifies the word 'premises' and not the words 'part of the premises'. Therefore, the licensor need not physically reside in the same room as the paying guest but only needs to reside in the premises; if the licensor resides in any part of the same building, the requirement is satisfied. The Court further held that the appellate court's findings of fact regarding control of the remaining accommodation and the binding nature of the letter dated 31.1.1974 were not liable to be interfered with under Article 226 of the Constitution of India. The Court relied on precedents including Rusi Dinshawji Deboo v. Cawasji Rustomji Patel for the binding effect of admission letters, Venkatapathi Raju v. Venkatanarasimha Raju for the principle that statements may be self-serving, and English cases on lodgers and control. Consequently, the appellant was held to be a paying guest, not a licensee or tenant, and could not claim deemed tenancy under section 15A because he was not in possession as a licensee on 1.2.1973. The appeals were dismissed without costs, and time to vacate was granted up to 31st May, 1988, subject to filing an undertaking within four weeks; failure to file the undertaking or breach of its terms would recall the time order.
Headnote
A) Rent Control and Eviction - Paying Guest - Definition and Scope - Bombay Rents, Hotel and Lodging House Rates (Control) Act, 1947, Section 5(6A) - The trial court held that licensor must reside in the very room occupied by paying guest; Supreme Court held that the words 'in which the licensor resides' qualify 'premises' not 'part of the premises'; thus owner residing in remaining part of same building satisfies requirement, not required to physically reside in the same room. Held that appellant was paying guest, not tenant. (Paras 1-5) B) Rent Control and Eviction - Licensee vs Paying Guest Distinction - Bombay Rents, Hotel and Lodging House Rates (Control) Act, 1947, Sections 5(4A) and 5(6A) - A paying guest is excluded from definition of licensee; licensee requires occupation under a subsisting agreement for licence for a fee, while paying guest requires a part of premises in which licensor resides. Therefore a paying guest cannot become deemed tenant under Section 15A because deemed tenancy requires possession as licensee on 1.2.1973. Held appellant not deemed tenant. (Paras 3-4) C) Evidence - Admission in Writing - Binding Effect - Bombay Rents, Hotel and Lodging House Rates (Control) Act, 1947, Section 5(6A) - Letter dated 31.1.1974 executed by appellant admitting paying guest status was held binding on parties as per Rusi Dinshawji Deboo v. Cawasji Rustomji Patel (AIR 1987 SC 1771). Even if respondent had stated to Municipal Corporation that appellant was tenant, such statement was rebutted by appellant's own admission. Held admission letter decisive. (Paras 2-3) D) Constitutional Law - Writ Jurisdiction - Interference with Findings of Fact - Constitution of India, Article 226 - High Court dismissed writ petitions because appellate court's findings on possession, control, and paying guest status were findings of fact not liable to be interfered under Article 226. Supreme Court affirmed this approach. Held no ground to interfere. (Paras 2-4) E) Rent Control and Eviction - Control vs Physical Residence - De Jure and De Facto Control - Bombay Rents, Hotel and Lodging House Rates (Control) Act, 1947, Section 5(6A) - The position of a paying guest is similar to a lodger in England; owner need only retain control over the whole premises, not actual physical residence in remaining part. If de jure control exists, de facto control need not be proved. Held that owner residing in first floor and retaining control of ground floor dining hall and bedrooms satisfied requirement. (Paras 4-5)
Issue of Consideration
Whether the appellant was a paying guest or a tenant under the Bombay Rents, Hotel and Lodging House Rates (Control) Act, 1947; whether the definition of paying guest under Section 5(6A) requires the licensor to reside in the very room occupied by the paying guest or merely in the premises; whether a paying guest can claim deemed tenancy under Section 15A; whether the High Court was justified in not interfering with the appellate court's findings of fact under Article 226 of the Constitution.
Final Decision
The appeals were dismissed without costs. The appellant was held to be a paying guest, not a licensee or tenant, and could not claim deemed tenancy under Section 15A of the Bombay Rents, Hotel and Lodging House Rates (Control) Act, 1947. Time to vacate the premises was granted up to 31st May, 1988, subject to the appellant filing the usual undertaking within four weeks from the date of judgment; if the undertaking was not filed or if there was a breach of any of its terms, the order granting time would stand recalled.
Law Points
- Paying guest is excluded from definition of licensee under Bombay Rents
- Hotel and Lodging House Rates (Control) Act
- 1947
- definition of paying guest requires licensor to reside in premises not same room
- deemed tenancy under Section 15A requires possession as licensee on 1.2.1973
- admission in writing acknowledging paying guest status is binding
- appellate court findings of fact not interfered under Article 226
