M/S. HOTEL KINGS AND ORS. versus SARA FARHAN LUKMANI AND ORS.

Citation: [2006] SUPP. 8 S.C.R. 716 · Decided: 08-11-2006 · Supreme Court of India · Bench: B.P. SINGH · Disposal: Disposed off

Judgment (excerpt)

A 
MIS. HOTEL KINGS AND ORS. 
v. 
SARA FARHAN LUKMANI AND ORS. 
NOVEMBER 8, 2006 
B 
[B.P. SINGH AND AL TAMAS KABIR, JJ.] 
Rent Control and Eviction: 
Bombay Rents, Hotel and Lodging House Rates (Control) Act, 1947: 
C Section I 2(3)(a). 
Lease deed-Landlord leased a plot of land to a company who in turn 
transferred and assigned the demiserJ property to some other company-By 
virtue of the deed of assignment the said company became the lessee of the 
D said land for the unexpired period of the lease and became a tenant under 
the landlord-As the said company defaulted in payment of rent for more 
than six months, the landlord issued a notice to the said company-Having 
refused to accept the rent tendered by the lessee, the lessors filed a suit 
claiming possession on .the ground that the lessee had defaulted in payment 
of rent-There were allegations of sub-letting also-The trial court dismissed 
E the lessors' suit for possession holding that rent of the suit property was 
payable every six months-But the appellate court decreed the suit for 
possession under Section 12(3)(a) holding that the rent for the demised 
premises was payable every month and not after six months-High Court 
affirmed the view of the appellate court-Held: The lease deed makes it 
abundantly clear that the lease rent was required to be paid on a monthly 
F basis-Hence, suit for possession rightly decreed-However, the decree for 
possession passed against the lessee will not bind those tenants who have 
been inducted into the premises by the lessee since they were lawfully inducted 
into the premises by virtue of the lease deed-Transfer of Property Act, 1882, 
S. 105. 
G 
H 
Words & Phrases: 
"Consideration"-Meaning of-Jn the context of S. 105 of the Transfer 
of Property Act, I 882. 
716 
... 
HOTEL KINGS v. SARA FARHAN LUKMAN! 
717 
The respondents were the owners of a plot of land. The said land was A 
leased to one company which in turn transferred and assigned the demised 
property to 'Y'. The original lease was for 98 years. By virtue of the deed of 
assignment 'Y' became the lessee of the said land for the unexpired period of 
the lease and became a tenant under the respondents. As 'Y' defaulted in 
payment of rent for more than six months, the respondents issued a notice to B 
the said company. Having refused to accept the rent tendered by the les~ee, 
the lessors filed a suit claiming possession on the ground that the lessee bad 
defaulted in payment of rent. There were also allegations that the lessee bad 
unlawfully sublet the demised property. 
The trial court dismissed the lessors' suit for possession holding that C 
rent of the suit property was payable every six months. The appellate court 
decreed the suit for possession un~er Section 12(3)(a) of the ~ombay Re11its, 
Hotel and Lodging House Rates (Control) Act, 1947 holding that the rent for 
the demised premises was payable every month and not after six months. The 
High Court affirmed the view of the appellate court. Hence the appeal. 
· 
D 
Disposing of the appeal, the Court 
HELD: 1. The decision of the appellate court holding that the lease was 
governed under Section 12(3)(a) of the Bombay Rents, Hotel and Lodging 
House Rates (Control) Act, 1947 was correct. The lease deed makes it 
abundantly clear that the lease rent was required to be paid on a monthly basis. E 
[728-F] 
2. In the instant case, the lessee is required to pay the rates and taxe$ 
and other outgoings for the demised premises in respect whereof the landlord 
has been given the right to effect permitted increase equivalent to the amount 
paid towards rates and taxes. The same does not make such payment a part of 
the rent though it may be a consideration for the grant oflease. The 'permitted, F 
increase' in the instant case serves as a yardstick for the landlord to increase, 
the rents on account of payment of rates and taxes by the landlord. 
(729-F, G; 730-A) 
Kranti Swaroop Machine Tools Pvt. Ltd. v. Kanta Bai Asawa (Smt.), · 
[1994] 2 SCC 289, Mis. Sarwan Kumar Onkar Nath v. Subhas Kumar' G 
Agarwal/a, [1987) 4 SCC 546, Kamani Properties Ltd. v. Augustine, [1957) , 
SCR 20, Puspa Sen Gupta v. Susma Ghose, [1990) 2 SCC 651 and Dinkar S. 
Vaidya v. Ganpat S. Gore, AIR (1981) Born. 190, referred to. 
The Bombay Municipal Corporation v. The Life Insurance Corporation 
H 
718 
SUPREME COURT REPORTS [2006) SUPP. 8 S.C.R. 
A of India, [1970) 1 SCC 791 and Raju Kakara Shetty v. Ramesh Prataprao 
Shiro/e, [199

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