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1980 DIGILAW 166 (KAR)

MAHANTAPPA GURAPPA v. JAYANTHI STORES

1980-07-22

K.S.PUTTASWAMY

body1980
( 1 ) IN this revision petition, the petitioner who is defendant No. 1 has challenged the order dated 19-4-1980 of the Principal Civil Judge, Hubli, in M. A. No. 5 of 1980 affirming the order dated 1-3-1980 of the I Addl. Munsiff, Hubli on LA. No. I in O. S. No. 18 of 1980. In the course of my order; I will refer to the parties to the position they occupy in the original suit before the trial Court. ( 2 ) SHOP premises bearing CTS No. 186, Municipal No. 5255/1 situated in belgaumgalli, Hubli, originally belonging 1o a joint family consisting of defendant No. 1 and his father, had been leased to defendant No. 2 some time in 1953-54 by the father of defendant no. 1. At a partition thereafter between defendant No. 1 and his father, the premises fell to the share of defendant No. 1 who became its absolute owner and accordingly defendant no. 2 has recognised defendant No. 1 as his landlord. ( 3 ) AS early as on 2-7-1969, defendant no. 1 instituted H. R. C No. 133 of 1969 in the court of the Munsiff, Hubli under s. 21 (1) (b) (h) and (j) of the karnataka Rent Control Act of 1961 (hereinafter referred to as the Act) seeking for his eviction which was resisted by him on every conceivable ground. On 31-7-1973 the III Addl. Munsiff Hubli allowed the said petition filed by defendant No. 1 granting two months' time to defendant No. 2 to vacate the premises. Against the said order of the learned Munsiff, defendant no. 2 filed an appeal in H. R. C. A No. 131 of 1973 before the District Judge dharwar. After a series of intermediate proceedings in the said appeal before the District Court and this Court, the narration of which is not necessary for purposes of this erase, the II Additional District Judge dharwar by his order dated 22-2-1979 dismissed the said appeal, vacating an illegal direction issued by the learned munsiff in the matter of reconstruction of the building, granting time to defendant No. 2 to vacate the premises till 1-4-1979. Against the said orders, defendant No. 2 filed C. R. P. No. 916 of 1979 before this Court. On 4. 12. 1979 bopanna, J. dismissed the said revision petition granting time to defendant no. 2 till 31-1-1980' to vacate the premises. Against the said orders, defendant No. 2 filed C. R. P. No. 916 of 1979 before this Court. On 4. 12. 1979 bopanna, J. dismissed the said revision petition granting time to defendant no. 2 till 31-1-1980' to vacate the premises. On an application made by defendant No. 2 for extension of time bopanna, J. by his order dated 25-1-80 granted time till 29-2-1980 finally. Against the said orders, defendant No. 2 has filed a Special leave petition with an application for stay before the supreme Court in which defendant No. 1 has entered caveat and the said petition is still pending disposal before the said Court. But even before the application for extension of time was made before this Court and the Special leave petition is disposed of by the supreme Court, the present proceedings have arisen to avoid the enforcement of the eviction decree obtained by defendant No. 1 against defendant No. 2. ( 4 ) ON 7-1-1980 the three plaintiff's instituted O. S. No. 18 of 1980 in the court of the Munsiff, Hubli, for a declaration that plaintiff No. 1 was the tenant oi the premises and the decree for eviction made in H. R. C. No. 133 of 1969 was invalid and not binding on them and for a permanent injunction to restrain defendant No. 1 from dispossessing them from the aforesaid premises in execution of the decree obtained by him. Shorn of all details the plaintiffs' claim was that the lease was not in favour of defendant No. 2, but was in favour of plaintiff No. 1, a registered partnership firm consisting of three, partners, namely plaintiffs 2, 3 and defendant no. 2 and the lease was not in favour of defendant No. 2 and therefore, the decree made against him in his individual capacity does not bind them. Along with the said suit, plaintiffs filed I. A. No. I under Order 39 Rules 1 and 2 of the Code for a temporary injunction to restrain defendant No. 1 from dispossessing them from the aforesaid premises in pursuance of the decree in H. R. C. No. 133 of 1969 which was opposed by defendant No. 1 and not by defendant No. 2. Defendant No. 1 urged that the lease was in favour of defendant 2 and was not in favour of plaintiff No. 1 and that in. Defendant No. 1 urged that the lease was in favour of defendant 2 and was not in favour of plaintiff No. 1 and that in. any event, defendant No. 2 being a partner, the decree made against him was binding and enforceable against the plaintiff's also. Defendant No. 1 urged that grant of temporary injunction restraining him from executing the decree obtained after a hard battle of more than a decade would cause him irrreparable injury and loss. On a consideration of the pleadings, affidavits and the documents produced by the parties and also the records in H. R. C. No. 133 of 1969, the learned Munsiff by his order dated 1-3-1980 allowed LA. No. I and granted a temporary injunction restraining defendant No. 1 from dispossessing the plaintiffs from the premises on the basis of the order in H. R. C. No. 133 of 1969 pending disposal of their suit-Against the said order of the learned munsiff, defendant No. 1 filed an appeal in M A. No. 5 of 1980 before the Civil Judge, Hubli, who by his order dated 19-4-1980 has dismissed the said appeal and has affirmed the order of the learned Munsiff. ( 5 ) SRI U. L. Narayana Rao, learned counsel for the petitioner contended that in granting a temporary injunction and preventing the petitioner from executing the decree in a frivolous suit filed by the plaintiffs, the Courts below have not applied the correct legal principles and have acted illegally and with material irregularity affecting their jurisdiction. ( 6 ) SRIYUTHS B. S. Keshava lyengar, learned Advocate General appearing for respondent No. 1, V. G. Dharma kumar and H. F. M. Reddy, learned counsel for respondents 2 to 4 supported the orders of the Courts below. ( 7 ) BEFORE examining the rival contentions of the parties, it is useful to notice certain facts that have been totally ignored by the Courts below in deciding the case but were not disputed before me by the learned Advocate General also who addressed the leading arguments for the respondents. ( 8 ) PLAINTIFF No, 1 claims to be a registered partnership firm under the name and style of "jayanthi Stores" carrying on cloth business in the premises ever since 1-1-1959, on which day it was registered. The firm consists of three partners viz. , plaintiffs 2, 3 and defendant No. 2. ( 8 ) PLAINTIFF No, 1 claims to be a registered partnership firm under the name and style of "jayanthi Stores" carrying on cloth business in the premises ever since 1-1-1959, on which day it was registered. The firm consists of three partners viz. , plaintiffs 2, 3 and defendant No. 2. Plaintiff No. 2 and defendant No. 2 are sanguine brothers. Plantiff No. three is a close relation of the other two partners. Even since 1-1-1959 or at any rate during the pendency of the H. R. C. proceedings, on the day the plaintiffs instituted their suit and even as on 15th and 16th July, 1980 on which days arguments in the case were heard by me, the firm continues and carries on business with the aforesaid three partners without there being any change in the constitution of the firm and its partners. At no time steps have been taken to dissolve the firm on the grounds pleaded in the plaint, i A. No. I or before this revision petition was hoard|by me. In H. R. C. No. 133 of 1969, defendant No. 2 who was described as the proprietor of plaintiff no. 1 contested the said proceedings on every conceivable ground before every Court and still contesting the same before the highest Court of the land, continues to bo a partner of the firm. With this background, it is now useful to examine the correctness of the findings recorded by the Courts below. ( 9 ) ON the first question that arises for determination for grant of a temporary injunction namely, whether the plaintiffs had an arguable or a prima facie case, after noticing the rival contentions the learned Munsiff holds in favour of the plaintiffs in these words: "but, the plaintiffs' counsel has contended that if the 2nd defendant has not contested the matter due diligently then, it is no! the fault of the other partners so as to suffer by losing their tenancy rights and, therefore, at present, they have been compelled to file this present suit and seek legal remedy. the fault of the other partners so as to suffer by losing their tenancy rights and, therefore, at present, they have been compelled to file this present suit and seek legal remedy. For all these reasons, it can be very well said that the plaintiffs have made out a prima facie case showing that there are several grounds in support of their contentions of tenancy and as there is substantial question of law and facts involved to be tried in detail by adducing evidence by both the parties. In appeal, the learned Civil Judge while referring to a large number of decisions that were cited at the bar, v hile concurring with the above finding of the learned Munsiff, opines that every contention urged for the plaintiffs is a serious question to be decided. as the trial of the suit. But, in reaching their conclusions, the Courts below have unfortunately over-looked the law relating to partnerships and the facts that are telling in the case noticed by me earlier. ( 10 ) ANY person can easily approach a Court and contend that the decree obtained by another person to which he was not a party does not bind him. A decree made by a Court to which a person is not a party does not bind him, has never been disputed and is unexceptionable. But, the question is whether on that score itself a hard fought out litigation as in the present case, affirmed by this Court, though not by the Supreme Court where the matter is still pending, should be considered as a case where it can be said that the plaintiffs have an arguable case. Acceptance of such a position without reference to the peculiar facts and pleas would lead to disastrous consequences. Can it be ever said, that the plaintiffs were unaware of the protracted legal proceedings culminating in the order of this Court, in particular, having regard to the relationship of defendant No. 2 with plaintiffs 2 and 3 and the continuance of the firm with those persons as its partners. In my opinion, the answer must be clearly in the negative. When that is so, the courts below in holding that the plaintiffs had an arguable case on the ground that they were not parties, acted illegally. In my opinion, the answer must be clearly in the negative. When that is so, the courts below in holding that the plaintiffs had an arguable case on the ground that they were not parties, acted illegally. ( 11 ) IN the H. R. C. proceedings, the courts have found that the lease was granted in favour of defendant No, 2 and that defendant No. 1 was entitled to eviction. A very strange plea of subtenancy is set up by the plaintiffs frqm defendant No. 2 which on the face of it and more so on facts is even inconceivable. But the learned Civil judge without critically examining the case, holds that the plea of sub-tenancy cannot be said to be illegal. Again, on the plea of the parties that the firm is not a distinct personality or otherwise and the acts of a partner binds the firm or not, the learned Civil Judge without noticing the provisions of the partnership Act and the statement of law made by the supreme Court in Malabar Fisheries co. v Commissioner of I. T. AIR 1980 SC. 176 . but referring to a large number of decisions of various High Courts, holds that that question is also an arguable case. In malabar Fisheries Co. , case the Supreme court on an examination of the provisiors of the Indian Partnership Act on the status of the firm and the relationship of the partners has ruled thus: "having regard to the above discussion it seems to us clear that a partnership firm under the Indian partnership Act, 1932 is not a distinot legal entity apart from the partners constituting it and equally in law the firm as such has no separate rights of its own in the partnership assets and when one talks of the firm s property or firm's assets all that is meant is property or assets in v hich all partners have a joint or common interest. If that be the position, it is difficult to accept the contention that upon dissolution the firm's rights in the partnership assets are extinguished. If that be the position, it is difficult to accept the contention that upon dissolution the firm's rights in the partnership assets are extinguished. The firm as such has no separate rights of its own in the partnership assets but it is the partners who own jointly in common the assets of the partnership and, therefore, the consequence of the distribution, division or allotment of assets to the partners which flows upon dissolution after discharge of liabilities is nothing but a mutual adjustment of rights between the partners and there is no question of extinguishment of the firm's rights in the partnership assets amounting to a transfer of assets within the meaning of Section 2 (47) of the Act. " even though the above ruling was rendered by the Supreme Court in deciding a question under the Indian income Tax Act, the principles stated therein on the status of the firm and its partners whenever such a question arises in any legal proceeding equally applies. On the application of the above principle, the fact that defendant No. 2 was described as a proprietor does not really make any difference, particularly when the plaintiffs themselves do not dispute that he has continued tqt be a partner of the firm all along. Both the Counts below have significantly failed to notice the legal principles concluded by the highest Court of the land and the facts that are all telling and have thus, arrived at an erroneous finding in holding that the plaintiffs have an arguable case. In my opinion, on the facts of the case and the law bearing on the point, the plaintiffs do not have an arguable case but, it is a frivolous and vexatious suit to avoid the enforceability of a vaild decree. ( 12 ) A temporary injunction cannot be granted in a frivolous and vexatious suit. In such a case, the question of examining the other two important factors viz. , irreparable injury and balance of convenience would not even arise. ( 13 ) ASSUMING that the plaintiffs have an arguable case, that by itself cannql be a ground to grant a temporary injunction to prevent the execution of a lawful decree unless there are compelling circumstances for the same. , irreparable injury and balance of convenience would not even arise. ( 13 ) ASSUMING that the plaintiffs have an arguable case, that by itself cannql be a ground to grant a temporary injunction to prevent the execution of a lawful decree unless there are compelling circumstances for the same. In examining this part of the case of the parties, it is proper to examine that the term 'injury' does not make any distinction between a void and voidable decree as pointed out by nittoor Sreenivasa Rau, J. (as he then was) in Mir Wazir Ali v. Hayat Bi 1960 Mys. L. J. 478 whatever be the conflict of opinion on that question among other High Courts. ( 14 ) UNFORTUNATELY, the Courts below have not examined the case of the plaintiffs from the above sand. But, still every one of the circumstances pleaded and disclosed show that there are no compelling circumstances assuming that the plaintiff's succeed it is not as if that they cannot be compensated in damages that they may suffer by their dispossession. When a party can be compensated in damages, a Court should be slow to grant a temporary injunction, that too to to prevent execution of a lawful decree affirmed by a superior Court. When the plaintiffs do not suffer any irreparable injury, balance of convenience would not be in their favour, but would be in favour of defendant No. 1, who has obtained a decree after a hard contest. In examining the plea of balance of convenience it is useful to refer to a very important and significant observation made by my learned brother Bopanna while dismissing the revision petition filed by defendant No. 2. which reads thus:"as it is, the unemployed landlord defendant No. 1 has been sitting by the ringside watching this lingious and agonising court room scenario for nearly a decade and I am not inclined to prolong the agony. "when the time granted by Bopanna, J expired, defendant No. 2 sought for 6 months time and his affidavit discloses that he was really seeking for time on behalf of the firm But, Bopanna, J. as a final chance granted one month's time to vacate the premises. "when the time granted by Bopanna, J expired, defendant No. 2 sought for 6 months time and his affidavit discloses that he was really seeking for time on behalf of the firm But, Bopanna, J. as a final chance granted one month's time to vacate the premises. But, by a sidewind, the courts below without ever noticing the orders and the observations made thereto, the irreparable injury that would be caused to defendant No. 1, in almost a casual manner have granted a temporary injunction and have virtually set at naught the decree made in H. R. C. No. 133 of 1969. I am distressed and pained at the orders made by the com ts below, particularly at the order of the learned Civil Judge, who discloses considerable scholarship but fails to do justice in a telltale case. ( 15 ) ASSUMING that all the three grounds on which Courts below have found in favour of the plaintiffs are correct, even then their orders cannot be maintained as they have not considered the conduct of the plaintiffs and defendant No. 2, an important factor that should always be kept in view. As that well recognised principle is neatly set out by Govinda bhat, J. (as he then was) in Lakshminarasimiah v. Yalakki Gowda (1965) 1 Mys. LJ. 370. , it is useful to reproduce the same which reads thus: '"besides the above, there are certain equitable principles also which govern the courts in granting or withholding of the relief of injunjction. One of the main considerations is the fairness or good conduct of the party invoking the aid of the Court. The Court denies the relief to a suitor who is himself guilty of misconduct in respect of the matter in controversy. It is a well known maxim of equity that "he who comes into equity must come with clean hands", or as otherwise expressed, ''he that hath committed inequity shall not have equity". The wrong conduct of the plaintiff in the particular matter or transaction with respect to which he seeks injunction relief precludes him from obtaining such relief. " in the light of the above principles, it is useful to examine the case without the benefit of the views of the Courts below. ( 16 ) DEFENDANT No. 2 is no other than the brother of plaintiff No. 2. All the partners are close relations. " in the light of the above principles, it is useful to examine the case without the benefit of the views of the Courts below. ( 16 ) DEFENDANT No. 2 is no other than the brother of plaintiff No. 2. All the partners are close relations. In law a firm has no legal entity. At no time there has been a dissolution of the firm on the alleged misconduct of defendant no. 2 except for the first time for purposes of the suit and I. A. No. I. Even here those allegations cannot be easily swallowed if one has regard to the continuance of the firm even after the institution of the suit. Earlier I had noticed that defendant No. 2 had urged that the petition was not maintainable as the lessee was the firm which had been found against him In the M. A. before the learned Civil Judge, defendant No. 2 filed an interesting statement of objections to I. A. No. I to support the case of the plaintiffs and defeat the claims of defendant No. 1. Those objections are worth reproducing and they read thus:"this respondent is one of the partners of the firm 'jayanti Stores ard the respondent No. 1. This respondent failed unfortunately to take up the contention that the H. R. C. proceedings for eviction were not maintainable against him personally. As a layman, he could not make out this distinction and hence the failure to take the said contention. When he changed his lawyer during the hearing of H. R. C. proceedings in the Munsiff Court, that mistake was noticed and the fact that javanthi Stores was a firm of partners and the H. R. C. proceedings filed against him individually were not lenable. But that aspect of the case was not considered since the pleading did not contain that plea. ' even in the first appellate Court the matter was argued and the judgment would show the same. This aspect of the case was brought to the notice of the appellant as stated above"from a reading of the above statement, though defendant No. 2 now wants to make his counsel a scapegoat, clearly justifies the conclusion that the suit is a collusive suit and is filed only to postpone the enforceability of a valid decree. This aspect of the case was brought to the notice of the appellant as stated above"from a reading of the above statement, though defendant No. 2 now wants to make his counsel a scapegoat, clearly justifies the conclusion that the suit is a collusive suit and is filed only to postpone the enforceability of a valid decree. An analysis of the above facts establish that the conduct of the plaintiffs clearly disentitle them for grant of a temporary injunction, assuming that the orders of the Courts below are correct on the other three grounds. ( 17 ) AS the Courts below have disregarded the legal principles and have, arrived at an erroneous conclusion affecting their jurisdiction, it has to be held that they have acted illegally and with material irregularity affecting their jurisdiction and their orders are liable to be set aside, though they are concurrent. ( 18 ) IN the light of my above discussion, I allow this revision petition, set aside the orders of the Courts below and reject I. A. No. I filed by respondents 1 to 3/ plaintiffs in O. S. No. 18 of 1980 with costs throughout. ( 19 ) CIVIL revision petition allowed with costs. Advocate's fee Rs. 100/ -. --- *** --- .