The Elegance And Others vs. M/S Param Hositality PVT. LTD. And Others

Facts

The petitioners, tenants of a marriage palace along with machinery, fittings, furniture, and a parking area, challenged orders from the Rent Controller that rejected their petitions for dismissal. The landlords had filed eviction petitions under Section 20(2)(a)(k)(o) read with Section 3(2) of the Punjab Rent Act, 1995, citing arrears of rent, material additions/alterations, and ceasing to occupy the premises. The tenants argued that the lease deeds, dated March 19, 2018, pertained to the business of running a marriage palace, not the building itself, rendering the Rent Controller without jurisdiction. The landlords contended that the lease deeds clearly indicated the leasing of the building and land, not just the business. The Rent Controller had previously dismissed an application by the tenants on September 16, 2023.

Held

The High Court held that the Rent Controller had properly exercised jurisdiction and that the revision petitions were not warranted. The Court found that the lease deeds, when read in conjunction with all their clauses, including the preface, clauses 1, 14, 16, and the specific terms of lease deed No. 3915 for parking, prima facie indicated that the building of the marriage palace and the land for parking were let out, not the business of running a marriage palace. The Court reasoned that clauses 14 and 15, while mentioning the business, did not exclusively point to the leasing of the business itself, especially when considered alongside other clauses that referred to the 'property' and 'land' and imposed obligations on the lessee regarding the upkeep and use of the building. The Court stated that the predominant intention of the parties at the time of entering into the lease agreements is a matter for scrutiny of evidence during the trial. Similarly, issues regarding arrears of rent, diminished value, or cessation of occupation are to be decided on merits and fall outside the limited scope of revision jurisdiction. Therefore, the Rent Controller's order rejecting the tenants' plea of non-maintainability was upheld.

Key Issues

1. Whether the lease agreements, specifically lease deeds bearing No. 3915 & 3916 dated March 19, 2018, were for the leasing of the business of running a marriage palace or for the leasing of the building and premises, thereby determining the applicability of the Punjab Rent Act, 1995, and the jurisdiction of the Rent Controller. Petitioner's Contention: The petitioners argued that the lease deeds, particularly clauses 14 and 15 of deed No. 3916, demonstrate a predominant intention to lease out the business of running a marriage palace, making the building secondary. They relied on definitions of 'premises' and 'non-residential premises' under Section 2(f) and 2(g) of the Rent Act and cited Dalip Singh Vs. Bharwan Bai (deceased), Spun Casting and Engg. Co. Pvt. Ltd. Vs. Dwijendra Lal Sinha, and Dwarka Prasad Vs. Dwarka Das Saraf. Respondent's Contention: The respondents contended that the lease deeds, read in their entirety, including clauses 1, 4, 8, 11, 7, and 8, indicate the leasing of the building and land, not the business. They argued that the use of words like 'property' and 'land', along with the tenants' obligations for NOCs and taxes, point to a lease of the premises. They also raised the plea of res judicata based on a previous dismissal of the tenants' application.