JUDGMENT K. C. Agrawal, J. 1. SHOP No 20, Mahatma Gandhi Marg, Allahabad belongs to Sardar Gopal Singh respondent No. 4. One Sardar Uttam Singh Oberai was originally the tenant of the shop. As he fell into arrears of rent a suit was filed by respondent No. 4 for recovery of arrears and rent and ejectment against him. The suit was, later compromised and Sardar Gopal Singh respondent No. 4 permitted Sardar Uttam Singh Oberai to enter into a partnership with Subhash Chandra Malik respondent No. 3. Consequently, the two entered into the partnership and started a firm known as M/s. Allied Electronic Corporation. Subsequently, the partnership was dissolved on March 31 1971, Before the dissolution of the firm, respondent No. 3 obtained an allotment order of the shop in his name. After dissolution the respondent No. 3 constituted a new partnership on 1-4-1971 consisting of himself, his mother and his brother's wife and thereafter continued the business in the same old name that is M/s. Allied Electronic Corporation. On 1st April, 1974 Ramesh Chandra Malik, another brother of respondent No. 3 was also taken as a partner in the firm. 2. ON 1st September, 1976 Dr. (Mrs.) Gyan Thapa, the petitioner filed an application for allotment of the aforesaid shop, viz. No. 20, Mahatma Gandhi Marg on the ground that a new partner having been admitted on 1st April, 1974, a vacancy in law had been caused. The application was resisted by Subhash Chandra Malik, respondent No. 3. He although admitted the admission of Ramesh Chandra Malik as a partner but denied that any vacancy was created as a result thereof. He claimed that the application filed by the petitioner was mala fide inasmuch as the same was got manipulated by Sardar Gopal Singh, the landlord respondent No. 4. 3. SARDAR Gopal Singh, respondent No. 4 also filed a reply to the application filed by the petitioner and admitted that as Ramesh Chandra Malik had been taken as a new partner in the firm M/s. Allied Electronic Corporation on 1st April, 1974, the shop would be deemed to be vacant within the meaning of sub-section (2) of Section 12 of U. P. Act No. 13 of 1972 and as such was liable to allotment. 4. THE Rent Control and Eviction Officer rejected the application of the petitioner on 9-5-1977.
4. THE Rent Control and Eviction Officer rejected the application of the petitioner on 9-5-1977. Against the said order, the petitioner preferred a revision under Section 18 of U. P. Act No. 13 of 1972. The revision met with the same fate. Feeling aggrieved, the petitioner has filed the present writ petition. Before dealing with the points, a brief resume of the findings may be given here. The Rent Control and Eviction Officer held that as the three partners had been admitted in 1971 by Subhash Chandra Malik, respondent No, 3 the tenancy of these four partners was entitled to be regularised under Section 14 of U. P. Act No. 13 of 19/2. He also found that as one of the partners taken in 1971 was Smt. Savitri Rani, the admission of Ravish Chandra Malik in 1974 being in conformity with subsection (2) of Section 12 of U. P. Act No. 13 of J972, the premises could not be deemed to be vacant within the meaning of sub-section (4) of Section 12 of the Act. In appeal the learned District Judge also took the same view. He relying on a decision of this Court reported in Shyam Las v. III Additional District Judge, Budaun, 1976 AWC 766 held that as the partnership came into existence on 1st April, 1971, the provisions of sub-section (2) of Section 12 of the Act were not applicable to it. In other words the view taken by the learned District Judge was that the admission of partners in 1971 would not create a vacancy under Section 12 of the Act. He also found that as Ravish Chandra Malik was a member of the family of Smt. Savitri Rani his admission could not be considered as a ground for holding that the premises was vacant. 5. THE question that arises for decision is whether the admission of Ravish Chandra Malik in April, 1974, created a vacancy. 6. BEFORE dealing with the new Act it appears appropriate to state in brief the position of law as it stood before the enactment of the new Act. There was no provision in the old Act forbidding the admission of any partner or dealing with the consequences it an admission of a partner was made in the firm.
6. BEFORE dealing with the new Act it appears appropriate to state in brief the position of law as it stood before the enactment of the new Act. There was no provision in the old Act forbidding the admission of any partner or dealing with the consequences it an admission of a partner was made in the firm. However, under Section 3 of the old Act, a controversy used to arise as to whether taking of a partner amounted to subletting. In Seth Laxmi Narain v. Nath Mal Dull Chand, 1965 AWR 663 a Division Bench of this Court held that a mere creation of partnership in the business did not necessarily create any interest in the tenancy. Upon the fact of each case, it had to be seen whether there was any transfer of interest in the tenancy to the members of the partnership. A distinction was, however, maintained between a case Where a lessee parted with legal possess- ion of his tenement in favour of the partnership and a case where a tenant simply changed the nature of his business and instead of running his personal business, he took a partner without conceding any right in the tenanted property. In the cases falling in the first category, the view was that the transaction amounted to creation of tenancies whereas in the cases covered by the second category, the law pro founded was that the mere fact of taking another to use the business premises while lessee retained the legal possession, no tenancy rights were transferred. 7. IN the instant case, the tenancy was in the name of Subhash Chandra Malik, respondent No. 3. In 1971, three partners were admitted. The question that was required to be considered and decided by the Courts below was whether these partners acquired any interest in the tenancy of the property or they were mere partners in the business and did not have any right in the tenancy. Neither the Prescribed Authority nor the learned District Judge gave any finding on this controversy. Both of them held that as Section 12 (2) of U. P. Act No. 13 of 1972 was not retrospective, the admission of partners in the year 1971 was inconsequential. This, however, does not appear to be the correct position.
Neither the Prescribed Authority nor the learned District Judge gave any finding on this controversy. Both of them held that as Section 12 (2) of U. P. Act No. 13 of 1972 was not retrospective, the admission of partners in the year 1971 was inconsequential. This, however, does not appear to be the correct position. A decision about the status and right of the partners in the tenancy of the property in dispute goes a long way to determine the effect of admission of Ravish Malik in April, 1974. 8. ON the facts of the present case there could be two positions. One was that legal possession of the property was transferred to the firm and that after the admission each one of them 'acquired a right in the tenancy. If that was so, the next question that would arise would whether there was any express or implied agreement between the partners and the landlord. A partnership can be created by agreement between the partners but a tenancy cannot be created except by an agreement with the landlord. The Courts below did not record any finding on this aspect of the matter. If, however, it was established that an express or implied agreement came into existence between the partners of the firm on the one hand and the landlord on the other that all the partners would be the tenant of the property, their possession although illegal could be regularised under Section 14 of the new Act. Section 14 of the new Act as it stood on the 15th July, 1972 read as under : "Notwithstanding, anything contained in any general order made under subsection (2) of Section 7 of the old Act, any tenant in occupation of a building with the consent of the landlord immediately before the commencement of this Act, not being a person against whom proceedings under Section 7-A of the old Act are pending immediately before such commencement, shall be deemed to be in authorised occupation of such building." This section again creates a legal fiction and provides for the regularisation and occupation of existing tenants. In order to avail the benefit of this section, it was, however, necessary to establish that the person was in occupation of the premises. It protected the occupation of those tenants who were actually in possession with the consent of the landlord.
In order to avail the benefit of this section, it was, however, necessary to establish that the person was in occupation of the premises. It protected the occupation of those tenants who were actually in possession with the consent of the landlord. The regularisation of possession, provided by this section, presupposes that the person seeking protection is in occupation of a building. 9. THE word 'occupation' used in Section 14 of the Act has not been defined in the New Act. It, however, appears that this word has been used with reference to possession of property. Reading of the words 'a tenant in occupation of a building' would clearly show that the person claiming the benefit must be in acutal physical enjoyment of the building. What is necessary is that the tenant must be found in possession on 15th July, 1972 for getting his occupation regularised. So far as, the dictionary meaning of the word 'occupation' is concerned the same is that, it is not necessary that the person claiming to occupy should be living in it or using it. In the context in which the word 'occupation' is found in Section 14, the meaning which has been given to the word must be that a person should exercise control over the property. Further requirement for availing the benefit of Section 14 is that the possession must have been with the consent of the landlord. The word 'consent' used here means an active circumstance of concurrence. A consent required by Section 14 of the Act need not be in writing. It could be express or implied. A consent it said to be express when it is directly given, either viva voce or in writing. It is positive, direct, unequivocal consent requiring no inference or implication to supply its meaning to the contrary a consent is said to be implied if it is manifested by actions, or facts or by inaction or silence, which raise a presumption that the consent has been given. 10. IN the instant case, the Courts below did not give any finding in favour of the partners as to whether they were occupying the premises as joint tenants with the consent of the landlord on 15th July, 1972. The Courts below thought that since they were doing business in the premises in suit, the tenancy was liable to be regularised under Section 14 of the new Act.
The Courts below thought that since they were doing business in the premises in suit, the tenancy was liable to be regularised under Section 14 of the new Act. Without holding that the four partners had physical control and enjoyment over the property, the Courts below could not find that that tenancy of the four partners was to be regularised under Section 14 of the new Act. In this view of the matter it was necessary for the Courts to examine whether the partners had any interest in the subject matter or the tenament. There is yet another difficulty on the way of respondent No. 3. He has always been ascerting that he was the exclusive tenant of the property in dispute and that as the remaining three partners of the firm were the members of his family, the taking of those persons as partners whether before or after coming into force of the new Act did not affect his tenancy rights. It is, however, not possible to conclude the case against respondent No. 3 on this point inasmuch as the same is likely to affect adversely the interest of the remaining three partners as well. Since no notices had been issued to the three partners, I am not in a position to know their stand viz, whether they were claiming any interest in the premises in dispute or not. 11. NOW the question that arises for decision is about the applicability of sub-section (2) of Section 12 of U. P. Act No. 13 of 1972. 12. EXPERIENCE had shown that a tenant used to enter into a transaction with a third person purporting to create a partnership in the business between himself and the new person but in reality such a transaction used to be merely a cloak or device for the purpose of circumventing the provisions of the Act, consequently, while enacting U. P. Act No. 13 of 1972, the Legislature provided that a tenant will not be entitled to take a person as a partner in the business. The said provision is to be found in sub-section (2) of Section 12 of the Act. As noted above, the three partners were taken by Subhash Chandra Malik in 1971 whereas a new partner was admitted in April, 1974.
The said provision is to be found in sub-section (2) of Section 12 of the Act. As noted above, the three partners were taken by Subhash Chandra Malik in 1971 whereas a new partner was admitted in April, 1974. Under the old Act, no allotment order should be passed in respect of an accommodation unless it had fallen vacant or was about to fall vacant. A vacancy, actual or imminent was a condition precedent for making an allotment. The new Act, apart from providing for actual or likely vacancy contains a provision about deemed vacancy. This is to be found in Section 12 of the new Act. This contemplates various situations on the "happening of any of them, a residential or a non-residential building is deemed to be vacant. In the present case, we are concerned with sub-section (2) of Section 12 of the Act. It provides as under :- "(2) In the case of a non-residential building, where a tenant carrying on business in the building admits a person who is not a member of his family as a partner or a new partner, as the case may be, the tenant shall be deemed to have ceased to occupy the building." The word "deemed'' is used for various purposes. Some times the word "deemed" is used to impose for the purpose of statue an artificial construction of a word or phrase that would not otherwise prevail. It is also used for the purposes of creating a legal fiction, that is, for the purpose of extending the meaning to a situation or subject matter which is not covered by it. There can still be another purpose for using the word "deemed". The same is to put beyond a particular construction that might otherwise be uncertain attributing it the meaning "shall be regarded as." 13. SUB-section (2) of Section 12 of the Act, it will be seen that it applies to a non-residential building in two situations :- (i) Where a tenant running a business as a proprietor converts it into a partnership and takes a person as a partner other than his family member ; (ii) When a business is already in partnership and a new partner other than family member is admitted to partnership. 14. THE expression 'family member-has been defined is Section 3 (g) of the new Act. As held in Shyam Das v. Ill Addl.
14. THE expression 'family member-has been defined is Section 3 (g) of the new Act. As held in Shyam Das v. Ill Addl. District Judge, Budaun, 1976 AWC 766 and Rajendra Prasad Jakodta v. Prescribed Authority, 1977 ARC 221, the admission of the three partners in 1971 would not attract sub-section (2) of Section 12 of the Act. The question only is about the admission of Ravish Chandra Malik in April, 1974. If Ravish Chandra Malik could not be considered to be a member of the family of Subhash Chandra Malik as he does not fall within the definition given in Section 3 (g), he could be a member of the family of Smt. Savitri Rani, but before Smt. Savitri Rani could be held to be entitled to admit him as a partner, it is necessary to find whether she herself had any interest or right in the premises of the shop. As already indicated above, the Courts below did not give any finding on this controversy. It is, therefore, necessary that this question should be reinvestigated. Even for deciding the question of applicability of sub-section (2) of Section 12 of the Act, it is necessary to issue notices to the three partners and to give them an opportunity of hearing before holding that a deemed vacancy had occurred under sub-section (2) of Section 12 of the Act. 15. SRI K. M. L. Hajela, the learned counsel for respondent No. 3 contended that since respondent No. 3 was entitled to get the benefit of Section 14 of the Act despite of the fact that the admission of Ravish Chandra Malik was illegal, the Court should reject the writ petition on that ground. It may be noted that the learned District Judge has accepted this argument advanced on behalf of respondent No. 3. It, however, appears difficult to subscribe to the view submitted by the learned counsel appearing for respondent No. 3. It is true that by the amendment made in Section 14 of Act No. 13 of 1972 by the Amending Act No. 28 of 1976, a tenant in occupation of a premises with the consent of the landlord has been made entitled to get his tenancy regularised under this section, but Section 14 regularises the tenancy of the person illegally admitted or in unauthorised possession of the premises.
It does not apply to a case where possession of a tenant was legal or authorised. Admittedly, Subhash Chandra Malik was a tenant of the premises. That being so, Section 14 of the Act would not apply to him. The argument by the learned counsel for respondent No. 3 that Section 14 was enacted for the benefits of a person like respondent No. 3 may be ingenuous, but it does not carry conviction. The legal fiction created by Section 14 of the Act could be taken help of by a person who had entered Into possession of a premises with the consent of landlord unauthorisedly. 16. IN Bengal Immunity Co. v. State of Bihar, AIR 1955 SC 661 , dealing with the interpretation of a legal fiction held that legal fictions are created only for some definite purposes. It observed :- "The judicial decisions referred to in the dissenting judgment in State of Travancore Cochin v. Shanmugha Vilas Cashew Nut Factory (Supra) at pp. 342 and 343 and the case of East End Dwellings Co. Ltd. v. Fins Borough Council, 1952 AC 109 at p. 132 (2) clearly indicate that a legal fiction is to be limited and should not be extended beyond the legitimate field." Accordingly, respondent No. 3 cannot get the benefit of Section 14 of the Act. 17. FOR the reasons given above, it is necessary to set aside the judgments of the two Courts below and to send back the case to the Rent Control and Eviction Officer for deciding the application filed by the petitioner afresh. The Rent Control and Eviction Officer is directed to issue notices to Smt. Savitri Rani wife of Om Prakash Malik (Mother of respondent No. 3), Smt. Saroj Malik wife of Ravish Chandra Malik and Ramesh Chandra Malik son of Om Prakash Malik. The Rent Control and Eviction Officer is further directed to give opportunity of producing evidence to all the parties and thereafter decide the application. 18. IN the result, the writ petition succeeds and is allowed. The judgments of the District Judge and of the Rent Control and Eviction Officer dated 30-7-1977 and 9-5-1977 are set aside. The Rent Control and Eviction Officer is directed to decide the application afresh in accordance with law and the observations made above. In the circumstances, I direct the parties to bear their own costs. Petition allowed.