2021 INSC 0714
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REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION 
CIVIL APPEAL NO. 6726 OF 2021
[Arising out of Special Leave Petition (Civil) No.28057 of
2019]
NATIONAL COMPANY, REPRESENTED
BY ITS MANAGING PARTNER ...APPELLANT(S)
VERSUS
THE TERRITORY MANAGER,
BHARAT PETROLEUM CORPORATION 
LTD. & ANR.         .... RESPONDENT(S)
J U D G M E N T 
B.R. GAVAI, J. 
1. Leave granted.

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2. The   appellant   has   approached   this   Court   being
aggrieved by the judgment and order dated 19 th
  September,
2019,   passed   by   the   Division   Bench   of   the   High   Court   of
Judicature   at   Madras,   in   Writ   Petition   No.16228   of   2014,
thereby   denying   the   prayer   made   by   the   appellant   for   a
direction to the respondents to vacate the property.  
3. The   facts,   in   brief,   giving   rise   to   the   present
appeal, are as under:
The property in question, being t he property con ­
sisting  of   vacant  land  situated  at  Old  No.320,  New No.469,
Anna   Salai,   Nandanam,   Chennai   600035,   admeasuring
6107   sq.ft.   (hereinafter   referred   to   as   ‘the   said   premises”)
was   leased   to   the   predecessor   of   the   respondent   No.1­
Bharat   Petroleum   Corporation   Ltd.   (hereinafter   referred   to
as   “the   BPCL”),   viz.,   Burmah   Shell   Oil   Storage   and   Dis ­
tributing Company of India by the predecessor of the appel ­
lant,   initially   for   a   period   of   20   years   in   the   year   1960.
Thereafter, the lease was renewed for another 20 years and
finally for another period of 11 years vide a registered lease
deed dated 23 rd
  April, 1999.   The said lease period came to

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an end on 31 st
  December, 2009.   On the said premises, re ­
spondent No.1­BPCL put up a petrol bunk, which was being
operated by the respondent No.2­M/s Vijaya Auto Services,
its licensor. 
Before the expiry of the lease period, i.e., 31 st
 De ­
cember, 2009, the appellant had issued a notice on 14 th
 Au ­
gust,   2008   to   respondent   No.1­BPCL,   thereby   terminating
the   lease.     Thereafter,   on   20 th
  May,   2009,   the   appellant   is ­
sued another notice to respondent No.1­BPCL to vacate the
said premises. By subsequent notices dated 16 th
  July, 2009
and 3 rd
 October, 2009, the appellant reiterated its demand.  
Since   respondent   No.1­BPCL   neither   vacated   the
said   premises   nor   took   steps   to   formalize   a   fresh   lease
agreement,   the   appellant   approached   the   Madras   High
Court   praying   for   a   direction   to   the   respondents   to   vacate
the said premises. 
It appears that, in the meantime, there were some
attempts to settle the matter, as the respondent No.1­BPCL
had   shown   interest   in   purchasing   the   property   outright.
However, the same did not fructify.  

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The matter originally was placed before the single
judge   of   the   Madras   High   Court.     On   25 th
  April,   2019,   the
single judge of the Madras High Court passed the following
order:
“ With   regard   to   maintainable   of   the   writ
petition, in so far as  the relief  prayed for
in   the   writ   petition,   there   is   conflict   of
judgment   passed   by   this   Court   reported
in   2001(1)   CTC   l   (W.A.No.2302   of
1999,   dated   20.10.2000),   2001   (1)
CTC 10 (W.P.No.20061 of 1998, dated
2.12.2000),   CDJ   2016   MHC   5023
(W.P.No.29312   of   2014),   CDJ   2018
MHC   1772   (W.P.No.14883   of   2015,
dated   22.01.2018)   and   an   unreported
judgment   in   W.P.No.7432   of   2009,
dated 22.10.2009  on the one hand held
that writ petition  is  not maintainable, and
the   judgment   passed   by   this.   Court   re ­
ported   in   2005(3)   L.   W.758
(W.P.No.B,l58   of   2001,   dated
19.7.2005),   2005   (3)   L.W.   523
(W.P.No.44758   of   2002,   dated
21.7.2005 ),   2011   (1)   L.W.146
(W.A.No.1767   of   2003,   dated
25.11.2010),   2014   (1)   MLJ   385   (W.A.
Nos.   630   &   657   of   2011,   dated
12.12.2013)   and   unreported   judgments
passed by this Court in  W.A.Nos.1796  &
1893   of   2014   dated   29.8.2008,
W.P.No.13521   of   2002   dated
4.1.2011,   W.A.   No.   44   of   2000   dated
21.7.2000   and   W.A.   No.779   of   2008

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dated   23.10.2008   on   the   other   hand,
writ petition  is  maintainable.
Therefore,   Registry   is   directed   to   place
this writ petition before the Hon'ble Chief
Justice for assigning the   writ petition be ­
fore   the   appropriate   Division   Bench,   so
as  to decide the maintainability of the wit
petition.”
Pursuant   to   the   aforesaid   order,   as   per   the
directions   of   the   learned   Chief   Justice,   the   matter   was
placed before the Division Bench of the High Court.
A   preliminary   objection   was   taken   regarding   the
maintainability   of   the   writ   petition   on   the   ground   that   the
writ   petition   involved   disputed   questions   of   fact   and   as
such, was not maintainable. 
It   was,   however,   contended   on   behalf   of   the
appellant that no disputed questions of law or fact arose for
consideration  and as such,  in view  of  the law laid down  by
this Court, the writ petition was maintainable.  
The   Division   Bench   by   the   impugned   judgment
and   order   dated   19 th
  September,   2019,   held   that   the   relief
claimed  by   the   appellant   for   a  direction   to   the  respondents
to   vacate   the   said   premises   could   not   be   granted   in   a

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petition   under   Article   226   of   the   Constitution   of   India   and
relegated the  appellant  to  the   alternate  remedy  available  in
law. 
The   Division   Bench   in   the   impugned   judgment
referred   to   the   judgment   of   this   Court   in   the   case   of   C.
Albert   Morris   v .   K.   Chandrasekaran   and   others 1
,
wherein this Court has held that once the lease has expired
and the landlord has declined to renew the lease and where
the   owner   calls   upon   the   erstwhile   tenant   to   surrender
possession, he could no longer assert any right over the site.
The Division Bench also referred to the judgment
of   this   Court   in   the   case   of   Hindustan   Petroleum
Corporation   Ltd.   and   another   v.   Dolly   Das 2
,   wherein   a
similar claim on behalf of the owner of the land was allowed
by this Court in writ jurisdiction.  
However,   the   Division   Bench   found   that   the
aforesaid   judgments   of   this   Court   had   not   considered   the
aspect with regard to protection given to a tenant under the
1  (2006) 1 SCC 228
2  (1999) 4 SCC 450

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enactments similar to Chennai City Tenants Protection Act,
1921 (hereinafter referred to as “the Tenants Act”). 
The Division Bench has also referred to its earlier
judgments   in   paragraphs   57   and   58   of   the   impugned
judgment, which read thus:
 “57. In   Bharat   petroleum   Corporation
Ltd   vs   R.Ravikiran   2011   (5)   CTC   437,   a
division   bench   of   this   court   while
disposing CRP (NPD), OSA and CMA) held
that   oil   company  was  in   legal   possession
of   the   subject   land.   While   the   actual
physical possession was with the dealers.
The   court   rejected   the   claim   of   the   Oil
Companies   under   section   2(4)   (ii)   (a)   in
view   of   the   decision   of   the   Honourable
Supreme Court in  S.R Radhakrishnan  vs
Neelamegam  (2003) 10 SCC 705. 
58. In   the   aforesaid   case   it   was   held
that   actual   physical   possession   was         a
sine   qua   non   for   claiming   the   benefit   of
section 9 of the Tamil Nadu City Tenants
Protection   Act,   1972.   However,   while
concluding,   the   court   observed   that   to
come   within   the   definition   of   section   2(4)
(ii) (a) of the Act, the petroleum  company
should   be   in   actual   possession   of   the
land   and   since   they   were   not   in   actual
possession,   they   were   not   entitled   to
protection   under   section   9   of   the   Act.
Similar   view   has   been   taken   in   several
other decisions.”
The Division Bench observed thus:

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“59. This   view   of   the   Division   Bench   of
this court is now subject matter of appeal
in   a   batch   of   appeals   and   Special   Leave
Petitions/appeal   before   the   Hon’ble
Supreme Court.”
Thereafter, the Division Bench referred to various
pronouncements   of   this   Court   as   well   as   the   Madras   High
Court   and   observed   that   the   conduct   of   the   respondent
No.1­BPCL   was   not   befitting   as   an   organ   of   a   State.
Thereafter, the Division Bench observed thus:
“72. The   remedy   that   is   sought   to   be
obtained before us is a remedy which can
only be granted by a civil court or by the
commercial   courts   as   the   arrangement
between   the   petitioner   and   the
respondent   arises   out   of   a   private
contract   entered   between   them   upto
31.12.1999.
73. Under   section   3   of   the   Madras   City
Tenants   Protection   Act,   1921,   the   1st
respondent   has   a   right   to   receive
compensation   for   the   value   for   building
which may have been erected by them or
by   their   predecessor   in   interest   and
subject   to   the   Agreement.   This
compensation   is   payable   once   eviction   is
ordered. 
74. Likewise,   under   section   9,   a   tenant
who   is   entitled   to   compensation   under

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section   3   of   the   Act,   against   whom
eviction proceeding has been instituted or
proceedings   under   section   41   of   the
Presidency Small Causes Court Act, 1979
has   a   right   to   apply   for   an   order   of   the
court   to   direct   the   landlord   to   sell   whole
or   part   of   land   for   his   convenient
enjoyment   and   the   court   shall   thereafter
fix the price of the minimum extent of the
land to be sold.
75. Therefore, to ask the 1st respondent
to   vacate   the   property   without   giving   the
1st   respondent   any   remedy   under   the
provisions   of   the   Madras   City   Tenants
Protection Act, 1921 would amount to by­
passing   the   law   and   depriving   the   1st
respondent   of   the   legal   remedy   available
to   it   as   per   the   dictum   of   the   Hon’ble
Supreme   Court   in   Bharat   petroleum
Corporation   Ltd   versus   N.R.Vairamani
(2004) 8 SCC 579. 
76. We   are   therefore   of   the   view   that   in
the   present   proceeding,   the   rights   of   the
1st   respondent   under   Section   9   of   the
Act,   cannot   be   ignored.   Whether   the   1st
respondent   to   a   tenant   cannot   be
determined   here.   Since   we   are   not
conducting   trial   in   a   writ   proceeding,   we
cannot   suo   moto   exercise   power   under
Section 9 of the Act.”
The   Division   Bench   thereafter   again   referred   to
the   conduct   of   the   respondent   No.1­BPCL   in   continuing   to
occupy   the   said   premises   without   paying   any   rent   thereof.

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The   Division   Bench   goes   on   to   observe   that,   “ Though   we
are perturbed by the conduct of the 1 st
  respondent, we
are   unfortunate   unable   to   come   to   the   rescue   of   the
petitioner   in   this   writ   petition   in   view   of   the   above
discussion .” (emphasis supplied).
It   could   thus   clearly   be   seen   that,   though   the
Division   Bench   found   that   the   claim   made   in   the   writ
petition was almost similar to the claim, which was allowed
by it in the case of  Bharat Petroleum Corporation Ltd. v.
R.   Ravikiran   and   others 3
,   it   denied   the   relief   to   the
appellant   only   on   the   ground   of   protection   granted   under
the Tenants Act and that the view taken by the Madras High
Court   in   the   case   of   R.   Ravikiran   (supra)   was   pending
before this Court. 
We   have   to   examine   the   correctness   of   the   said
view. 
4. We   have   heard   Shri   V.   Giri,   learned   Senior
Counsel   appearing   on   behalf   of   the   appellant   and   Shri
3  2011 (5) CTC 437

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Kailash Vasdev, learned Senior Counsel appearing on behalf
of the respondents. 
5. Shri V. Giri, learned Senior Counsel appearing on
behalf   of   the   appellant   submits   that   the   issue   is   no   more
res integra .   This Court, speaking through a bench of three
judges,   in   the   case   of   Bharat   Petroleum   Corporation
Limited   v.   R.   Chandramouleeswaran   and   others 4
  has
held   that   the   tenants   would   not   be   entitled   to   benefit   and
rights   under   the   Tenants   Act   unless   they   are   in   actual
physical possession of the building constructed by them. He
submits   that,   in   the   present   case   also,   undisputedly,   re ­
spondent   No.1­BPCL   has   sub­let/leased   out   the   said
premises   to   the   respondent   No.2   and   as   such,   it   is   not   in
actual physical possession of the building constructed by it.
He therefore submits that the judgment of this Court in the
case of  R. Chandramouleeswaran  (supra) squarely applies
to the facts of the present case. 
6. Learned   Senior   Counsel   further   submits   that   in
the present case, no disputed questions of law or facts arise
4  (2020) 11 SCC 718

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for   consideration.     As   such,   the   Madras   High   Court   while
exercising   its   jurisdiction   under   Article   226   of   the
Constitution of India ought to have allowed the writ petition.
He   further   submits   that   respondent   No.1­BPCL   is   enjoying
the property  without paying  a  single farthing  from  the  date
of  expiry  of  lease  by   efflux   of  time  i.e.  31 st
  December,  2009
and   as   such,   the   conduct   of   the   respondent   No.1­BPCL   is
unbecoming   of   a   statutory   corporation,   which   is   a   State
within the meaning of Article 12 of the Constitution of India.
He   therefore   submits   that   while   allowing   the   appeal   and
directing the  respondent No.1­BPCL  to handover vacant and
peaceful possession of the said premises to the appellant, it
will also be necessary that this Court directs the  respondent
No.1­BPCL  to pay market rent from 31 st
 December, 2009 till
the date of delivery of actual physical possession. 
7. Shri   Kailash   Vasdev,   learned   Senior   Counsel
appearing   on   behalf   of   the   BPCL,   on   the   contrary,   submits
that   the   question   as   to   whether   the   respondent   No.1­BPCL
has   sub­let   or   leased   out   the   said   premises   to   the
respondent   No.2   is   a   disputed   question   of   fact,   which   can

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only   be   adjudicated   upon   by   the   parties   before   the
appropriate forum .   He further submits that the view taken
by   this   Court   in   the   case   of   R.   Chandramouleeswaran
(supra)   is   not   a   correct   view   in   law.     He   submits   that   the
perusal   of   the   agreements   entered   into   between   the   BPCL
with   its   dealers   would   show   that   the   possession   of   the
premises, with all the control, is with the BPCL.  The dealer
is   only   given   a   right   to   run   the   petrol   pump.     He   therefore
submits   that   the   High   Court   has   rightly   relegated   the
appellant to the alternate remedy available in law.
8. Perusal   of   the   impugned   judgment   rendered   by
the   Division   Bench   would   reveal   that   though   an   objection
with   regard   to   maintainability   of   the   writ   petition   on   the
ground   of   alternate   remedy   was   seriously   raised   by   the   re ­
spondent No.1­BPCL , the Division Bench was not impressed
much   with   the   said   submission.     As   a   matter   of   fact,   the
Division   Bench   not   only   referred   to   the   judgment   of   this
Court in the case of   ABL International Ltd. and another
v.   Export   Credit   Guarantee   Corporation   of   India   Ltd.

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and others 5
  but also   emboldened the following observations
of   this   Court   while   reproducing   paragraph   19   of   the   said
judgment, which reads thus:
“ 19.   Therefore,   it   is   clear   from   the
above   enunciation   of   law   that   merely
because   one   of   the   parties   to   the
litigation   raises   a   dispute   in   regard   to
the   facts   of   the   case,   the   court
entertaining   such   petition   under
Article   226   of   the   Constitution   is   not
always bound to relegate the parties to
a suit.”
9. The Division Bench also referred to the judgment
of this Court in the case of   Dolly Das   (supra), wherein this
Court   held   that   in   similar   facts,   appellants   therein   were
justified in approaching the writ Court under Article 226 of
the Constitution of India and directed the  HPCL   to handover
vacant possession and pay the monthly rent. 
10. It   is   to   be   noted,   as   has   been   noted   by   the   High
Court, that the Division Bench of the same High Court in its
decision   in   the   case   of   R.   Ravikiran   (supra)  had   held  that
oil   company   was   in   legal   possession   of   the   subject   land,
5  (2004) 3 SCC 553

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while   the   actual   physical   possession   was   with   the   dealers.
The   Division   Bench   specifically   rejected   the   claim   made   by
the   oil   company   under   Section   2(4)   (ii)   (a)   of   the   Tenants
Act,   in   view   of   the   judgment   of   this   Court   in   case   of   S.R.
Radhakrishnan and others v. Neelamegam 6
.  
11. Having noted that to get the benefit under Section
9   of the Tamil Nadu City  Tenants Protection Act, 1972, the
petroleum   company   should   be   in   actual   possession   of   the
land   and   since   they   were   not   in   actual   possession,   they
were   not   entitled   to   protection   under   Section   9   of   the
Tenants Act, the Division Bench in the impugned judgment
stopped at granting relief in favour of the appellant only on
the   ground   that   the   view   of   the   Division   Bench   in   R.
Ravikiran   (supra)  was  subject  matter   of  appeal  in   a  batch
of   Special   Leave   Petitions/Appeals   pending   before   this
Court. 
12. It   could   thus   clearly   be   seen   that   the   Division
Bench   itself   did   not   find   much   favour   with   the   arguments
advanced   on   behalf   of   the   respondent   No.1­BPCL     with
6  (2003) 10 SCC 705

16
regard   to   non­exercise   of   jurisdiction   under   Article   226   of
the   Constitution   of   India   on   the   ground   of   availability   of
alternate remedy and declined the relief only on the ground
that the view taken by the other Division Bench in the case
of   R.   Ravikiran   (supra)   and   other   matters,   was   pending
consideration   before   this   Court   in   a   batch   of   appeals   and
Special Leave Petitions.  
13. The said impediment is now no more in existence.
The   view   taken   by   the   Division   Bench   in   the   case   of   R.
Ravikiran   (supra)   has   been   upheld   by   a   Bench   of   three
judges   of   this   Court   in   the   case   of   R.
Chandramouleeswaran  (supra). 
14. It   will   be   relevant   to   refer   to   the   following
observations   of   this   Court   in   the   case   of   R.
Chandramouleeswaran  (supra):
  “ 17.   A Division Bench of this Court vide
order   dated   3­12­2009   in   Bharat   Petro ­
leum   Corpn.   Ltd.   v.   Nirmala   [ Bharat   Petro ­
leum   Corpn.   Ltd.   v.   Nirmala ,   (2020)   11
SCC   738]   and   other   connected   matters
while   interpreting   sub­clause   ( b )   to   Sec ­

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tion   2(4)( ii )   has   held   that   the   expression
“actual   physical   possession   of   land   and
building”   would   mean   and   require   the
tenant   to   be   in   actual   physical   posses ­
sion.   The   provisions   would   not   be   appli ­
cable if the tenant is not in actual physi ­
cal   possession   and   has   given   the
premises   on   lease   or   licence   basis   to   a
third   party.   The   Court,   however,   did   not
give  any  finding   on  the  question   whether
such   benefit   is   available   to   the   appellant
under  Section  2(4)( i )   or  Section  2(4)( ii )( a ).
We   are   reproducing   the   relevant   portion
of   the   order   which   reads   as   under:   (SCC
pp. 740­42, paras 7­10 & 13­14)
‘7 . As regards sub­clause ( b ) of Sec ­
tion 2(4), we do not agree with the con ­
tention   of   Mr   Nariman.   On   a   plain
reading of sub­clause ( b ) we notice that
it uses the words “actual physical pos ­
session”.   Had   the   word   “possession”
alone   been   used   in   clause   ( b ),   as   has
been done in clause ( a ), the legal posi ­
tion may have been different. However,
the words “actual physical possession”
are   strong   and   emphatic.   That   means
that   the   factual   state   of   affairs   has   to
be   seen,   not   the   legal   or   deemed   state
of   affairs.   There   is   no   doubt   that   the
appellant   had   handed   over   possession
to   his   licensee/agent   who   was   in   ac ­
tual   physical   possession   of   the   suit
premises.   When   a   statute   uses   strong
and   emphatic   words,   we   cannot   twist
or   give  a  strained  interpretation   to  the
said words. The literal rule of interpre ­

18
tation is the first rule of interpretation
which   means   that   if   the   meaning   of   a
statute   is   plain   and   clear   then   it
should   not   be   given   a   twisted   or
strained   meaning.   We   will   be   giving   a
strained  and  artificial  interpretation   to
the words “actual physical possession”
if  we   say   that  the   appellant   is   deemed
to be in actual physical possession. We
cannot   give   such   an   interpretation   to
sub­clause ( b ) of Section 2(4) of the Act
particularly   since   clause   ( a )   only   uses
the   word   “possession”   and   not   “actual
physical   possession”.   Hence,   we   reject
the   contention   of   Mr   R.F.   Nariman,
learned   counsel   appearing   for   the   ap ­
pellant and hold that the appellant was
not in actual physical possession.
8 . The Preamble of the Act makes it
clear that the Act applies where super ­
structure   is   constructed   on   the   land,
which is leased. Hence, the submission
that clause ( a ) applies when there is no
superstructure   erected   on   the   vacant
land   which   was   leased   is   not   correct.
In fact, the Act was meant to give some
protection to leased land on which the
tenant   constructed   some   superstruc ­
ture.
9 .   As   regards   the   submission   of   Mr
Nariman   that   the   appellant   is   entitled
to   the  benefit   of   sub­clause   ( a )   of   Sec ­
tions   2(4)   of   the   Act,   it   appears   that
this aspect has not been considered by
the   High   Court.   In   our   opinion,   the
High   Court   should   have   considered

19
whether the appellant is entitled to the
benefit   of   Section   2(4)( i )   and   sub­
clause ( a ) of Section 2(4)( ii ) of the Act.
10 .   We   are   not   expressing   any   final
opinion   on   the   question   whether   the
appellant   is   entitled   to   the   benefit   of
Sections 2(4)( i ) and 2(4)( ii )( a ) of the Act
as   in   our   opinion   it   was   incumbent
upon   the   High   Court   to   have   recorded
a   finding   on   the   said   issue.   Therefore,
we   set   aside   the   impugned   judgment
and   order   [ Bharat   Petroleum   Corpn.
Ltd.   v.   M. Nirmala , CRP (NPD) No. 1815
of  2002,  order  dated  25­8­2005  (Mad)]
of the High Court and remand the mat ­
ter   back   to   the   Division   Bench   of   the
High   Court   to   record   a   finding   on   the
question whether the appellant is enti ­
tled to the benefit of Section 2(4)( i ) and
sub­clause   ( a )   of   Section   2(4)( ii )   of   the
Act. Needless to mention, that the Divi ­
sion Bench of the High Court shall de ­
cide   the   said   question   in   accordance
with   law   and   uninfluenced   by   any   ob ­
servation made by us in this order ex ­
cept   the   finding   that   the   appellant   is
not   covered   by   sub­clause   ( b )   of   Sec ­
tion   2(4)   of   the   Act.   We   make   it   clear
that we are not expressing any opinion
of our own on the other issue. We hope
and   trust   that   the   Division   Bench   of
the High Court will dispose of the case
expeditiously   and   preferably   within   a
period   of   six   months   from   the   date   a
copy of this order is produced before it.
***

20
13 .   We   are   further   of   the   opinion
that where the lessee is in actual phys ­
ical   possession   of   the   land   over   which
he   has   made   construction   then   he   is
entitled   to   an   additional   benefit   given
by   Section   9(1)( a )( ii )   of   the   Act.   How ­
ever,   if   the   lessee   who   has   made   con ­
struction on the land let out to him but
was  not   subsequently  in   possession   of
the   same,   as   is   the   case   of   the   appel ­
lants   in   the   present   cases,   then   he   is
not   entitled   to   the   benefit   of   Section
9(1)( a )( ii )  though   he  may   be  entitled  to
the   benefit   of   Section   9(1)( a )( i ).   These
are   the   questions   on   which   the   Divi ­
sion   Bench   of   the   High   Court   will
record a finding.
14 .   Therefore,   we   set   aside   the   im ­
pugned   judgments   and   orders   of   the
High   Court   and   remand   the   matter
back to the Division Bench of the High
Court to  record a  finding  on the ques ­
tion   whether   the   appellant   is   covered
by  Section 2(4)( i ) and sub­clause ( a ) of
Section 2(4)( ii ) of the Act and is entitled
to  the  benefit  of  Section  9(1).  Needless
to   mention,   the   Division   Bench   of   the
High Court shall decide the said ques ­
tion   in  accordance  with  law  and   unin ­
fluenced   by   any   observation   made   by
us   in   this   order   except   our   finding
about   clause   ( b )   of   Section   2(4).   We
make   it   clear   that   we   are   not   express ­
ing any opinion of our own on other is ­
sues. We hope and trust that the Divi ­
sion   Bench   of   the   High   Court   will   dis ­

21
pose   of   these   cases   expeditiously   and
preferably   within   a   period   of   six
months from the date a copy of this or ­
der is produced before it.’
18.   Thus, while interpreting sub­clause
( b )   to   Section   2(4)( ii ),   this   Court   has
held that the expression “actual physi ­
cal   possession   of   land   and   building”
would   mean   and   require   the   tenant   to
be   in   actual   possession   and   sub­clause
( b )   would   not   apply   if   the   tenant   has
sub­let   the   building   or   has   given   the
premises   on   leave   and   licence   basis.
The   aforesaid   decision   would   operate
as res judicata in the case of the appel ­
lant   and   the   landlords   who   were   par ­
ties   to   the   decision.   In   other   cases,   it
would   operate   as   a   binding   precedent
under Article 141 of the Constitution .”
[emphasis supplied]
15. It could  thus be seen that this Court in the  case
of   R.   Chandramouleeswaran   (supra)   has   held   that   this
Court   in   the   case   of   Bharat   Petroleum   Corporation
Ltd.   v.     Nirmala and others 7
   and other connected matters,
while   interpreting   the   expression   “actual   physical   posses ­
sion of land and building” would mean and require the ten ­
ant   to   be   in   actual   physical   possession   and   sub­clause   (b)
7   (2020) 11 SCC 738

22
would not apply if the tenant has sub­let the building or has
given   the   premises   on   leave   and   licence   basis.     It   further
held   that   the   aforesaid   decision   would   operate   as   res   judi ­
cata in the case of the appellant and the landlords who were
parties   to   the   said   decision.   It   further   held   that   in   other
cases, it would operate as a binding precedent under Article
141   of   the   Constitution   of   India.     Not   only   that,   but   this
Court made the position amply clear in the concluding para ­
graph 28, which reads thus:
“28.   Recording  the aforesaid position, we
dismiss the present appeals by the appel ­
lant, that is, the three petroleum  compa ­
nies,   and   uphold   the   orders   passed   by
the High Court that the appellant tenants
would   not   be   entitled   to   the   benefit   and
rights   under   the   Act   unless   they   are   in
actual physical possession of the building
constructed by them.  In other words, in
case   the   appellants   have   let   out   or
sub­let the building or given it to third
parties,   including   dealers   or   li ­
censees, they  would  not be entitled to
protection and benefit under the Act .”
[emphasis supplied]
16. This   Court   has   upheld   the   orders   passed   by   the
High Court that the appellant tenants would not be entitled

23
to the benefit and rights under the Tenants Act unless they
are   in   actual   physical   possession   of   the   building
constructed by  them.   The  position is amply  made clear  by
observing that in case the appellants have let out or sub­let
the building or given it to third parties, including dealers or
licensees,   they   would   not   be   entitled   to   protection   and
benefit under the Tenants Act. 
17. Though   Shri   Kailash   Vasdev,   learned   Senior
Counsel,   attempted   to   assail   the   correctness   of   the   said
judgment,   such   an   exercise   is   not   permissible   in   law.   The
said   judgment   of   this   Court   in   the   case   of   R.
Chandramouleeswaran   (supra)   is   delivered   by   a   Bench
consisting   of   three   judges   and   we   are   bound   by   the   view
taken therein.  
18. We   have   perused   the   agreement   between   the   re ­
spondent No.1­BPCL   and the respondent No.2 herein.   Shri
Kailash   Vasdev,   learned   Senior   Counsel,   fairly   concedes
that all the agreements between the   respondent No.1­BPCL
and   its   dealers   are   identical.   As   such,   when   a   Bench   of

24
three   judges   of   this   Court   in   the   case   of   R.
Chandramouleeswaran   (supra),   while   considering   a
similar   agreement   between   the   appellant­BPCL   and   the
dealer,   has  held that  since  the  appellant  tenant  was not  in
actual   physical   possession,   it   was   not   entitled   to   the
protection   under   the   Tenants   Act,   the   said   view   is   bound
even in the facts of the present case.  
19. In   the   result,   we   find   that   the   view   taken   by   the
High Court, thereby relegating the appellant to the alternate
remedy available in law, is not sustainable.
20. As observed by the High Court, the conduct of the
respondent No.1­BPCL   in continuing with the occupation of
the   said   premises   without   paying   any   rent   from   31 st
December,   2009   is   unbecoming   of   a   statutory   corporation,
which   is   a   State   within   the   meaning   of   Article   12   of   the
Constitution of India.  We therefore find that while directing
the   respondents   to   vacate   the   said   premises   and   handover
peaceful and vacant possession to the appellant, it will also
be   necessary   in   the   interests   of   justice   to   direct   the
respondent   No.1­BPCL   to   pay   arrears   of   market   rent   from

25
31 st
  December,   2009,   till   the   date   of   delivery   of   possession
at the market rate. 
21. In   the   result,   the   appeal   is   allowed   in   the
following terms:
(i) The respondent No.1­BPCL is directed to vacate and
handover peaceful and vacant possession of the said
premises   to   the   appellant   within   a   period   of   three
months from today.
(ii) The   respondent   No.1­BPCL   is   directed   to   pay
arrears   of   market   rent   to   the   appellant   from   31 st
December,   2009   till   the   date   of   handing   over   of
possession.  
22. We postpone the issue of determination of market
rent   for  a  period  of  three weeks  from  today.    The  appellant
as   well   as   the   respondents   shall   file   their   written
submissions with regard to the market rent with supporting
documents within a period of two weeks from today.  
23. The   respondent   No.1­BPCL   shall   also   pay   costs,
quantified   at   Rs.1,00,000/­   (Rupees   One   lakh   only)   to   the
appellant. 

26
24. The   appeal   is   disposed   of   in   the   above   terms.
Pending applications, if any, shall stand disposed of. 
…….…....................., J.
                             [L. NAGESWARA RAO]
…….…....................., J.
                                                 [B.R. GAVAI]
NEW DELHI;
NOVEMBER 11, 2021