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National Company v. The Territory Manager, Bharat Petroleum Corporation Ltd. & Anr.

Civil Appeal · 2021 INSC 714Decided 11 Nov 2021
Civil Appeal No. 6726 of 2021
Justice L. Nageswara Rao · Justice B.R. Gavai

Background

A landowner had leased a plot of land in Chennai to Bharat Petroleum Corporation Ltd. (BPCL) for decades, with a final lease expiring in 2009. BPCL had, in turn, let a dealer run a petrol pump on the land. After the lease expired, the landowner repeatedly asked BPCL to vacate, but BPCL neither left nor paid any rent, instead claiming protection under the Chennai City Tenants Protection Act, 1921. The Madras High Court's Division Bench declined to order BPCL to vacate in a writ petition, holding the landowner should instead pursue a civil suit, partly because a related legal question was then pending before the Supreme Court in other cases.

Decision Breakdown

The Supreme Court noted that the very legal question the High Court had deferred to, whether a tenant who has sub-let premises to someone else (rather than keeping "actual physical possession" itself) can claim protection under the Tenants Act, had since been authoritatively decided by a three-judge bench in Bharat Petroleum Corporation Ltd. v. R. Chandramouleeswaran, which held that such a tenant is not entitled to that protection. Since BPCL had sub-let the premises to its dealer and was not itself in actual physical possession, it could not claim protection under the Act. The Court allowed the appeal, directed BPCL to hand over vacant possession within three months, ordered it to pay market-rate arrears of rent from the date the lease expired, and awarded costs of Rs. 1,00,000 to the landowner, leaving only the precise calculation of the market rent to be worked out with written submissions from both sides.

Lesson Learnt

A tenant who sub-lets or hands over actual physical possession of leased premises to a third party cannot claim statutory tenant-protection benefits that are meant for tenants who personally occupy and use the property.

Official source (sci.gov.in)View Judgment (PDF)

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