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1961 DIGILAW 143 (ALL)

Radha Kishan v. Data Ram

1961-07-21

MITHAN LAL, SRIVASTAVA

body1961
JUDGMENT Mithan Lal, J. - This second appeal filed by the landlord arises out of a suit for possession by eviction of the Defendants. The facts of the case have not been disputed. The Plaintiff Appellant is the owner of the shop in dispute which was let out to Defendant No. 1 at a monthly rent of Rs. 12-8-0 per mensem. No rent was in arrears except for one month. The Plaintiff alleged that Defendant No. 2 had sublet the shop to Defendant No. 2 after taking some premium and as the subletting of the shop was without the consent of the Plaintiff, therefore, he was liable to ejectment. A notice of eviction was also served and then the suit was brought. 2. Both the Defendant-Respondents contested the suit. Their main plea was that there was no subletting of the shop by Defendant No. 1 and that both the Defendants had entered into a partnership business and so both of them were continuing in possession. It was disputed that any premium or pagri had been taken from Defendant No. 2 and the taking of Defendant No. 2 as a partner was said not to amount to any subletting. 3. Both the Courts below have found that Defendant No. 1 was the tenant of the shop in dispute at Rs. 12-8-10 per mensem rent, that no pagri was taken from Defendant No. 2, but as Defendant Nos. 1 and 2 entered into a partnership in September 1950 this partnership was being run in the shop instead of the single owned business of Defendant No. 1. According to the view taken by both the Courts below it does not amount to subletting and the Plaintiff is not entitled to any decree for ejectment. The suit was accordingly dismissed. It is against these findings that the present appeal has been instituted. 4. The matter came up before a learned single Judge of this Court who thought that the question "Whether by converting the business from a single owned business into a partnership business there was any subletting" was an important question and consequently the matter was referred to a Bench. 5. 4. The matter came up before a learned single Judge of this Court who thought that the question "Whether by converting the business from a single owned business into a partnership business there was any subletting" was an important question and consequently the matter was referred to a Bench. 5. The only question which arises for consideration in the case is whether Defendant No. 1 should be deemed to have sublet the shop within the meaning of S. 3(1)(e) of the U.P. (Temporary) Control of Rent and Eviction Act because he took Defendant No. 2 as a partner in the business in September 1950. 6. We have heard Learned Counsel for the parties at some length in the case. It is not disputed that originally Defendant No. 1 alone was a tenant of the shop at a monthly rent of Rs. 12-8-0 and thereafter he took Defendant No. 2 as a partner by entering into a partnership agreement on the 28th of September 1950. One of the terms of the partnership agreement is as follows: Yeh ki dukan haza tarikh imroza se baruye shirakatnama haza donon fariqain ki mushtarka kirayedari me mutsawwar hogi. 7. The original partnership deed which was filed in the case by the Defendants and was marked Ex. D was taken back by them along with Exs. A, B and C as noted in the General Index of the original file. Mr. Bhargava, Learned Counsel for the Respondents, is not in a position to produce the original deed. A copy of the same has been supplied to us by the counsel for the Appellant and the aforesaid term of the said agreement has been quoted from that copy. 8. It is a case in which the tenant has not completely withdrawn his possession from the premises but has put in another person in joint possession along with himself. 9. It would appear from the object of the UP (Temporary) Control of Rent and Eviction Act that the Act was enforced in order to meet the shortage of accommodation in the State by controlling the letting out of the accommodation as well as its rent with the object that the tenants may not be harassed by undue eviction. It seems that with this object in view a wider meaning was given to the definition of the words "landlord" and "tenant". It seems that with this object in view a wider meaning was given to the definition of the words "landlord" and "tenant". "Landlord" has been defined as a person to whom rent is payable by a tenant in respect of any accommodation and includes the agent, attorney, heir or assignee of such person. While "tenant" has been defined to mean a person by whom rent is, or but for a contract express or implied would be payable for any accommodation. The Act does not defined the expression "subletting" of the whole or any part of the interest in the property without the permission of the landlord. We have to find out with reference to the facts of the present case whether the present is a case of "subletting" within the real meaning of the term. Under the Transfer of Property Act the lessee has been given a transferable right by way of mortgage or sub-lease of the whole or any part of his interest and the transferee of such interest or part according to the terms of the contract will be either a mortgagee or sub-leasee or even an assignee in case of an assignable interest. What is, therefore, to be seen in case of sub-letting is 'whether the lessee has by means of a contract with the third person sublet the whole or any part of his interest in the property. 10. In the present case we have quoted one of the terms of the partnership under which it was agreed between the two Defendants that from the execution of the partnership deed both the Defendants shall be deemed to be joint tenants of the shop in dispute. In view of this term of the agreement of partnership it is obvious that what was done by Defendant No. 1 in admitting Defendant No. 2 to partnership was making him a partner in the tenancy. It is not the case in which another person has been permitted to occupy without any interest. For this purpose we have to look to the distinction between a lease and a licence and without quoting any former authority we would only quote the latest authority of the Supreme Court, viz. 11. Associated Hotels of India Ltd. Vs. R.N. Kapoor, AIR 1959 SC 1262 , his Lordship Mr. For this purpose we have to look to the distinction between a lease and a licence and without quoting any former authority we would only quote the latest authority of the Supreme Court, viz. 11. Associated Hotels of India Ltd. Vs. R.N. Kapoor, AIR 1959 SC 1262 , his Lordship Mr. Justice Subba Rao laid down the following propositions in order to distinguish between a lease and a licence: (1) The substance of the document must be preferred to be form; (2) the real test is the intention of the parties-whether they intended to create a lease or a licence; (3) if the document creates an interest in the property, it is a lease; but, if it only permits another to make use of the property, of which the legal possession continues with the owner it is a licence; and (4) if under the document a party gets exclusive possession of the property, 'prima facie', he is considered to be a tenant. 12. It was further observed that in certain cases circumstances may be established which negative the intention to create a lease. In the aforementioned case certain accommodation in a hotel in New Delhi was let out and the document which was written was in the form of a licence and the parties were described as lessors and licencees. Since the document created an interest of the licencee in the property it was thought that a lease had been given in the form of a licence and the document really amounted to a lease. 13. Applying the aforesaid test to the instant case, it would appear that the real intention of the parties in admitting Defendant No. 2 to the possession of the shop was that Defendant No. 2 should share in the tenancy. The document created an interest in favour of Defendant No. 2 and the terms of the document in substance show that the admission of Defendant No. 2 to the shop was not a mere licence but amounted to a lease or sub-lease in the present case. The document created an interest in favour of Defendant No. 2 and the terms of the document in substance show that the admission of Defendant No. 2 to the shop was not a mere licence but amounted to a lease or sub-lease in the present case. Out of the several tests indicated the only one which does not apply is that of exclusive possession but in this case exclusive possession could not have been transferred because both the Defendants had agreed to carry on cloth business in the shop in dispute and so Defendant No. 2 had to be admitted to joint possession along with Defendant No. 1. The terms of the document and the intention of the parties being clear the mere fact that both the Defendants remained in possession of the shop or the intention of the parties was that both should remain in joint possession could not make the contract between the parties a mere licence. 14. No hard and fast rule can be laid down as to whether in all cases of partnership the admission of another partner to the joint possession of the shop will or will not amount to subletting. Each case will depend upon its own facts. The intention of the parties and particularly whether any interest of the other partner created is in the tenancy by the agreement between the parties will have to be seen. Looking at the particular facts of the present case, as we have stated earlier the intention of the parties is too obvious and it cannot be said that this is not a case of subletting. 15. Learned Counsel for the Respondents has referred to the case of Gundalapalli Rangamannar Chetty Vs. Desu Rangiah and Others, AIR 1954 Mad 182 . In that case, in the partnership agreement, which had been entered into between the two Defendants, there was no transfer of any interest in the leasehold property to the other partner. The document only related to the partnership business to be carried on jointly by the first Respondent with the second Respondent. It made a mention only with respect to the rights and liabilities in regard to the business, but there was no mention about any sharing in the tenancy or the liability of the partnership to pay rent. It was on the facts of that case that Mr. It made a mention only with respect to the rights and liabilities in regard to the business, but there was no mention about any sharing in the tenancy or the liability of the partnership to pay rent. It was on the facts of that case that Mr. Justice Subba Rao held that the partnership did not amount to a sub lease. Two other cases which have been relied on by the Learned Counsel for the Respondents are Puran Chand v. Rent Control and Eviction Officer, Kanpur 1959 ALJ 343 and Ram Prakash Vs. Shambhu Dayal Agarwal and Another, AIR 1960 All 395 . In the first case the question, which came up for decision in a petition under Article 226, was whether a certain accommodation in Kanpur had or had not fallen vacant in order that it could be allotted by the Rent Control and Eviction Officer and the view taken was that as the tenancy had not terminated and the tenant was still there though with a partner the accommodation had not fallen vacant. That was enough for the disposal of that petition. Certain general observations, viz. A tenant has the right to start a business in his premises in partnership with another, provided that the partnership is a genuine transaction and not a clock, to conceal a transfer of possession of the premises to a bogus "partner" in consideration of payment of an illegal premium or rent. 16. A person does not transfer possession of his premises or cease to occupy them when he sets up in them a business in partnership with others," were however made on which the Learned Counsel for the Respondents placed reliance. The observations appear to be obiter. But if it was intended to be laid down that no case of a tenant taking a partner can either amount to subletting or transfer of that tenancy, with great respect, we are unable to subscribe to that proposition. As we have said already each case will depend upon its own facts. There may be cases of a tenant taking a partner which may amount only to his permitting another person as a licensee to do something in the premises. As we have said already each case will depend upon its own facts. There may be cases of a tenant taking a partner which may amount only to his permitting another person as a licensee to do something in the premises. On the other hand, there may be cases like the present where while taking a partner the tenant creates an interest in the tenancy of another person and the transaction of partnership may amount to subletting. In the other case Ram Prakash Vs. Shambhu Dayal Agarwal and Another, AIR 1960 All 395 a question arose whether a relation's starting to live with a tenant would amount to the subletting of the accommodation and it was found that as he was living merely as a relation there was no subletting. That case did not relate to a partnership at all. Other instances of cases where taking another person as a partner and putting him in joint possession has been held to be an act of subletting are not wanting. Such a case has been reported in Shamji Naranji v. State of Madhya Pradesh AIR 1954 Nag. 161. In that case 'A' along was a tenant of the premises and he allowed other persons to enter in partnership along with himself to carry on the business in the dismissed premises. It was held by the Bench that the act of 'A' by which he entered into partnership with third parties brought about a distinct personality in law distinct from that of 'A' himself. 'A' brought himself within the purview of law prohibiting subletting except with the permission of the landlord and was, therefore, liable to ejectment on the ground of unauthorised subletting. 17. There is another case of this Court, which has not been reported so far, decided by a Bench in Satya Deo Gupta v. Ram Chandra SA No. 814 of 1951 on the 9th of January 1958 in which the Division Bench held that upon the facts proved in the case and upon the legal position which emerged from those facts the partner was a sublessee and the accommodation must be deemed to have been sublet to the partner. The tenant was held liable to ejectment as envisaged by S. 3(1)(e) of the UP (Temporary) Control of Rent and Eviction Act. The tenant was held liable to ejectment as envisaged by S. 3(1)(e) of the UP (Temporary) Control of Rent and Eviction Act. In an earlier single Judge case reported in Ram Bharose v. Ajeet Kumar 1952 AWR (HC) 276 the learned single Judge held that for the purpose of subletting it was not essential for the landlord to prove that the sub-tenant had been paying rent to the tenant. In order to create the relationship of landlord and tenant between the tenant & the sub-lessee). It was thought sufficient if the landlord proved that the sub-tenant had been in possession of the premises with the consent of the tenant but without the consent of the landlord. 18. Our view, therefore, is that, having regard to the facts and circumstances of the present case when Defendant No. 1 took Defendant No. 2 as a partner his act amounted to the subletting of the shop even though both the Defendants continued in joint possession and no exclusive possession was given to Defendant No. 2. The transaction must be deemed to be subletting within the meaning which must be given to that phrase used in Cl. (e) of Sub-section (1) of S. 3. 19. In the result the appeal must succeed. The Learned Counsel for the Respondents has prayed for four months' time to vacate the shop to which the Appellant's counsel has no objection. 20. The appeal is a lowed and the judgment and decree of the Court below is set aside. The Plaintiff's sunt or possession by eviction of the Defendants is hereby decreed along with Rs. 12-8-0 as arrears of rent. The Plaintiff shall get his costs throughout, but he shall be entitled to get possession only after four months.