Statutory tenancy under rent control survives acquisition and corporate succession where occupation on the relevant date is established.

A licensee in occupation on the relevant statutory date under Section 15A of the Bombay Rent, Hotel and Lodging House Rates Control Act, 1947 was deemed a tenant, and that statutory tenancy continued despite later acquisition of the undertaking. The Court held that transfer of the company's rights to the Central Government, and thereafter to the successor company, did not extinguish the already vested protection or break continuity of the tenancy. A personal licence could not be treated as defeating a statutory tenancy that had arisen under the rent law. The eviction order was therefore unsustainable, and the occupants retained statutory protection in the flat.

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Issues: (i) Whether the petitioner, as successor-in-interest of the original licensee, was entitled to the protection of Section 15A of the Bombay Rent, Hotel and Lodging House Rates Control Act, 1947; (ii) Whether the licence was extinguished on acquisition of the undertaking, so that the protected tenancy rights did not vest in the Central Government and thereafter in the successor company.

Issue (i): Whether the petitioner, as successor-in-interest of the original licensee, was entitled to the protection of Section 15A of the Bombay Rent, Hotel and Lodging House Rates Control Act, 1947.

Analysis: The flat was held under a subsisting leave and licence arrangement on 1 February 1973. Once that factual basis was established, Section 15A operated to deem the licensee a tenant for the purposes of the rent law. The later acquisition of the undertaking did not displace the statutory protection already earned by the licensee, and the subsequent corporate succession did not break the continuity of the statutory tenancy.

Conclusion: The petitioner was entitled to the protection of Section 15A.

Issue (ii): Whether the licence was extinguished on acquisition of the undertaking, so that the protected tenancy rights did not vest in the Central Government and thereafter in the successor company.

Analysis: Under Section 3 of the Acquisition Act, the right, title and interest of the company in relation to its undertakings stood transferred to the Central Government on the appointed day. By Section 5, the Central Government became the lessee or tenant in respect of property held by the company under lease or tenancy, and the statutory rights attached to the tenancy vested accordingly. The Court rejected the view that a personal licence necessarily ceased so as to defeat the statutory tenancy that had already arisen under Section 15A. The later vesting in the Government company and the subsequent amalgamation did not destroy the statutory protection.

Conclusion: The licence was not extinguished in a manner that defeated the vested tenancy rights, and the successor company continued to be protected.

Final Conclusion: The eviction order of the co-operative appellate forum could not stand, and the petitioners retained statutory protection in respect of the flat.

Ratio Decidendi: Where a licensee was in occupation on the relevant statutory date and thereby acquired deemed tenancy under rent-control legislation, that statutory tenancy could not be defeated by subsequent acquisition or corporate succession unless the statute expressly so provided.

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