TaxTMI 
TaxTMI 
1959 (5) TMI 41
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....within the meaning of s. 2(b) of the Rent Control Act; therefore that Act did not apply and the respondent was not entitled to ask for the determination of fair rent under its provisions. The reasons for which I have reached that conclusion are somewhat different from those of my learned brother, Sarkar J., and it is, therefore, necessary that I should state the reasons in my own words. I read first s. 2(b) of the Rent Control Act so far as it is relevant for our purpose: "S. 2. In this Act, unless there is anything repugnant in the subject or context,- (a)............................................... (b) 'premises' means any building or building which is, or is intended to be, let for use as a residence or for commercial any other purpose......... but does not include a room in a dharamshala, hotel or lodging house." The question before us is-what is the meaning of the expression 'a room in a, hotel' ? Does it merely mean a room which in a physical sense is within a building or part of a building used as a hotel; or does it mean something more, that is the room itself is not' only within a hotel in a physical sense but is let out to serve what a....
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....ging house in some respects and indicates that the former is an establishment where not merely lodging but some other amenities are provided. It was, however, never questioned that the Imperial Hotel, New Delhi, is a hotel within the meaning of that word as it is commonly understood, or even as it is defined in the cognate Act. Passing now from definitions which are apt not to be uniform, the question is whether the partitioned spaces in the two cloak rooms let out to the respondent were rooms in that hotel. In a physical sense they were undoubtedly rooms in that hotel. I am prepared, however to say that a strictly literal construction may not be justified and the word 'room' in the composite expression 'room in a hotel' must take colour from the context or the collocation of words in which it has been used; in other words, its meaning should be determined noscitur a sociis. The reason why I think so may be explained by an illustration. Suppose there is a big room inside a hotel; in a physical sense it is a room in a hotel, but let us suppose that it is let out, to take an extreme example, as a timber godown. Will it still be a room in a hotel, though in a physical ....
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....e was a tenant of the spaces in the cloak rooms under the appellant and asking that standard rent might be fixed in respect of them. The appellant opposed the application, contending for reasons to be mentioned later, that the Act did not apply and no standard rent could be fixed. The Rent Controller however rejected the appellant's contention and allowed the application fixing the standard rent at ₹ 94 per month. On appeal by the appellant,. the,District Judge of Delhi If set aside the order of the Rent Controller and dismissed the application. R. N. Kapoor then moved the High Court in revision. The High Court set aside the order of the District Judge and restored that of the Rent Controller. Hence this appeal. We are informed that R. N. Kapoor died pending the present appeal and his legal representatives have been duly brought on the record. No one has however appeared to oppose the appeal and we have not had the advantage of the other side of the case placed before us. As earlier stated, the appellant contends that the Act does not apply to the present case and the Rent Controller bad no jurisdiction to fix a standard rent. This contention was founded on two grounds wh....
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....these proceedings that the Imperial Hotel was not an " hotel " within the Act. Indeed, the Imperial Hotel is one of the best known hotels of New Delhi. It also seems to me plain that the spaces are "rooms ", for, this again has not been disputed in the Courts below and I have not found any reason to think that they are not rooms. The language used in the Act is " room in a...... hotel". The word " hotel " here must refer to a building for a room in an hotel must be a room in a building. That building no doubt must be an hotel, that is to say, a building in which the business of an hotel is carried on. The language used in the Act would include an room in the hotel building. That is its plain meaning. Unless there is good reason to do otherwise, that meaning cannot be departed from. This is the view that the learned District Judge took. Is there then any reason why the words of the statute should be given a meaning other than their ordinary meaning? The Rent Controller and the High Court found several such reasons and these I will now consider. The learned Rent Controller took the view that a room in an hotel would be a room normally used fo....
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....ognate Act, The Bombay Rents, Hotels and Lodging House, Rates Control Act, 1947 (Bom. 57 of 1947), which has been made applicable toDelhi, for that Act deals with lodging rates in an hotel which are entirely different from rents payable when hotel rooms are let out. A lodger in an hotel is a mere licensee and not a tenant for " there is involved in the term "lodger" that the man must lodge in the house of another "; see Foa on Landlord and Tenant (8th Ed.) p. 9. It could hardly have been intended to leave a person who is practically a boarder in an hotel in that situation. As I have earlier said, it would be a most unusual hotel which lets out its rooms to a guest, and the Act could not have been contemplating such a thing. Khosla, J., also said that the room in a hotel need not necessarily be a bed room but it must be so intimately connected with the hotel as to be a part and parcel of it, that it must be a room which is an essential amenity provided by an hotel e.g., the dining room in an hotel. I am unable to agree. I do not appreciate why any room in an hotel is not intimately connected with it, by which apparently is meant, the business of the hotel. The b....
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....owever be difficult to see how a room in a dharamsala can be let out for the purposes of the dharamsala for a dharamsala does not as a rule supply food or give any services, properly so called. Having given the matter my best consideration I have not been able to find any reason why the words used in the definition should not have their plain meaning given to them. I therefore come to the conclusion that a room in an hotel within the definition is any room in a building in the whole of which the business of an hotel is run. So understood, the definition would include the spaces in the cloak rooms of the Imperiol Hotel with which we are concerned. These spaces are, in my view, rooms in an hotel and excluded from the operation of the Act. The Rent Controller had no power to fix any standard rent in respect of them. The appellant also contended that Kapoor was not a tenant of the spaces but only a licensee and so again the Act did not apply. The question so raised depends on the construction of the written agreement under which Kapoor came to occupy the spaces and the circumstances of the case. I do not consider it necessary to express any opinion on this question for this appeal mu....
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.... Rent Controller had no jurisdiction to fix a fair rent for the premises. The respondent preferred a revision against the said order of the District Judge to the High Court of Punjab at Simla, and Khosla, J., held that the said premises were not rooms in a hotel within the meaning of s. 2 of the Act and that the document executed between the parties created a lease and not a licence. On those findings, he set aside the decree of the learned District Judge and restored the order of the Rent Controller. The present appeal was filed in this Court by special leave granted to the appellants on January 18, 1954. The learned Solicitor-General and Mr. Chatterjee, who followed him, contended that the Rent Controller had no jurisdiction to fix a fair rent under the Act in regard to the said premises for the following reasons: (1) The document dated May 1, 1949, created a relationship of licensor and licensee between the parties and not that of lessor and lessee as held by the High Court; and (2) the said rooms were rooms in a hotel within the meaning of s. 2 of the Act, and, therefore, they were exempted from the operation. of the Act. Unfortunately, the legal representative of the responde....
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....t make any alterations in the premises without the prior consent in writing from the licensor. 7. That should the licensee fail to pay the agreed fee to the licensor from the date an d in the manner as agreed, the licensor shall be at liberty to terminate this DEED without any notice and without payment of any compensation and shall be entitled to charge interest at 12% per annum on the amount remaining unpaid. 8. That in case the licensee for reasons beyond their control are forced to close their business in Delhi, the licensor agrees that during the remaining period the license shall be transferred to any person with the consent and approval of the licensor subject to charges so obtained not exceeding the monthly charge of ₹ 800." The document no doubt uses phraseology appropriate to a licence. But it is the substance of the agreement that matters and not the form, for otherwise clever drafting can camouflage the real intention of the parties. What is the substance of this document ? Two rooms at the Hotel Imperial were put in possession of the respondent for the purpose, of carrying on his business as hair-dresser from May 1, 1949. The term of the document was, in ....
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....d to make use of the premises for a particular purpose'. But for the permission, his occupation would be unlawful. It does not create in his favour any estate or interest n the property. There is, therefore, cleat distinction between the two concepts. The dividing line is clear though sometimes it becomes very thin or even blurred. At one time it was thought that the test of exclusive possession was infalliable and if a person was given exclusive possession of a premises, it would conclusively establish that he was a lessee. But there was a change and the recent trend of judicial opinion is reflected in Errington v. Errington ([1952] 1 All E.R. 149.), wherein Lord Denning reviewing the case law on the subject summarizes the result of his discussion thus at p. 155: "The result of all these cases is that, although a person who is let into exclusive possession is prima facie, to be considered to be tenant, nevertheless he will not be held to be so if the circumstances negative any intention to create a tenancy." The Court of Appeal again in Cobb v. Lane ([1952] 1 All E.R. 1199.) considered the legal position and laid down that the intention of the parties was the real ....
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.... the Act. Section 2(b) defines the term " premises and the material portion of it is as follows: " " Premises means any building or part of a building which is, or is intended to be, let separately........................................................................................... but does not include a room in a, dharmashala, hotel or lodging house." What is the construction of the words " a room in a hotel " ? The object of the Act as disclosed in the preamble is " to provide for the control of rents and evictions, and for the lease to Government of premises upon their becoming vacant, in certain areas in the 49 Provinces of Delhi and Ajmer-Merwara". The Act was, therefore, passed to control exorbitant rents of buildings prevailing in the said States. But s. 2 exempts a room in a hotel from the operation of the Act. The reason for the exemption may be to encourage running of hotels in the cities, or it may be for other reasons. Whatever may be the object of the Act, the scope of the exemption cannot be enlarged so as to limit the operation of the Act. The exemption from the Act is only in respect of a room in a hotel. The collocati....