Suresh Kumar Sharma v. Krishna Maheswari — 1987 DIGILAW 287 (CAL)

JUDGMENT The petitioner filed this application for setting aside the award dated 10.6.85 on various grounds set out in paragraph 16 of the petition. 2. The history of the case will appear from the facts set out below:- The parties were carrying on business in co-partnership under the name and style of M/s. Tools and Bearing Centre and the business used to be carried on from two tenanted rooms, pursuant to a Deed of Partnership dated 16.3.74. The tenancy in respect of Room No. 16 stood in the name of the petitioner Sharma and the tenancy in respect of Room No. 16/3, stood in the name of the partnership firm. This partnership deed contained an arbitration clause. Disputes and difference arose between the two partners which were referred to four arbitrators who made their award on 18.2.75. The parties, however, did not accept the said award and instead agreed to settle, the disputes themselves by executing a deed of dissolution dated 6.3.75 whereby the respondent Maheswari retired from the business on certain terms and conditions and Sharma become entitled to carry on the business of M/s. Tools and Bearing Centre as the sole proprietor thereof. 3. During the hearing of this application, the counsel for the parties handed over to me copies of the Partnership Deed dated 16.3.74, public notice of dissolution and its corrigendum published in the Amrita Bazar Patrika dated 7.3.76 and 18.9.76 respectively as well as Maheswari's letters dated 3.3.76 and 15.11.76 addressed to Sharma and Sharma’s reply to Maheswari through his Advocates M/s. Dube & Co. dated 20.5.76. A copy of the statement of claim filed by Sharma before the alleged arbitrator Bhagwandas on 20.3.76 was also reduced in Court. The existence of these documents as admitted by the parties. Going through the correspondence, I find that Maheswari was asking Sharma to act in accordance with the terms of the deed of dissolution but Sharma was not willing to do so. On the contrary, by his letter dated 20.3.76, written through Dube & Co., Sharma raised certain disputes concerning the terms of the deed of dissolution. Going through the correspondence, I find that Maheswari was asking Sharma to act in accordance with the terms of the deed of dissolution but Sharma was not willing to do so. On the contrary, by his letter dated 20.3.76, written through Dube & Co., Sharma raised certain disputes concerning the terms of the deed of dissolution. By that letter, Sharma alleged that by a subsequent oral agreement between the parties, Maheswari had agreed that Room No. 16/3, which was intended to be transferred to him in his personal name under the deed of dissolution, should not be given effect to and that room should remain in the name of the firm M/s. Tools & Bearing Centre. Sharma demanded that Maheswari should deliver back vacant possession of that room to Sharma in accordance with the subsequent oral agreement. Sharma raised these disputes and referred the matter to one Bhagwandas as his arbitrator to adjudicate upon the said disputes. 4. But this deed of dissolution dated 16.3.75 did not contain any arbitration clause; Neither it contained any provision whereby the arbitration clause contained in the deed of partnership dated 16.3.74 could be attracted or be made applicable for resolving any dispute arising out of the deed of dissolution. I have carefully gone through the statement of claim filed by Sharma before Bhagwandas and have found that all the disputes referred to arbitration related to and arose out of the deed of dissolution only. I am convinced that the said reference was absolutely invalid as there was no agreement between the parties for resolving the disputes raised in connection with the deed of dissolution by arbitration. 5. After Sharma made the reference to Bhagwandas, Maheswari took out an application under sections 33 and 41 of the Arbitration Act, being Matter No. 961 of 1976. That application was contested. But intend of that purported reference being declared invalid, the disputes were purported to be referred to two arbitrators by order dated 2.3.77. Unfortunately, none of the parties invited the attention of the Court to the fact that the deed of dissolution dated 6.3.75 did not contain any arbitration clause or there was any other provision in the deed dated 6.3.74 for which the arbitration clause of the partnership dated 16.3.74 could be invoked by the parties for deciding the disputes arising out of the deed of dissolution. It is true that if the disputes were of the nature as to whether the dissolution had all taken place or not, that dispute could come under the arbitration clause contained in the partnership deed, but looking at the issues framed before the joint arbitrators, nobody can have any doubt in his mind that the disputes raised were regarding the construction of the terms of the deed of dissolution and for determination of their legal effects. The question of jurisdiction of the arbitrators was also raised. From the copy of the order dated 2.3.77, I find that the parties had invoked the arbitration clause contained in the Deed of Partnership dated 16.3.74 which was not at all applicable for deciding the disputes raised in this case. The issues before the Joint Arbitrators are set out below :- 1. Can the Joint Arbitrators go beyond the deed of dissolution dated 6.3.75 ? 2. Have the Joint Arbitrators' jurisdiction to determine the legality and/or validity of the deed of dissolution dated 6.3.75? If so, what would be the effect of the said deed of dissolution? 3. Are the claims covered by the order of reference? 4. To what relief, if any, is the claimant entitled? 6. There was disagreement between the Joint Arbitrators. Thereupon, another application was made and by an order dated 9.1.79 the Joint Arbitrators were removed after holding about 30 sitting and the present arbitrator, Mr. Dipak Basu, Bar-at-Law, was appointed as the sole arbitrator. He held about 84 sittings and made and published his award on 10.6.85. The application is for setting aside Mr. Basu's Award. 7. I have already pointed out that there was no arbitration clause in the deed of dissolution dated 6.3.75 which was an independent and separate agreement and different from the deed of partnership. Hence neither the Joint Arbitrators nor the Sole Arbitrator Mr. D.K. Basu had any jurisdiction to adjudicate upon the disputes arising out of the Deed of Dissolution or to construe the said deed. Hence neither the Joint Arbitrators nor the Sole Arbitrator Mr. D.K. Basu had any jurisdiction to adjudicate upon the disputes arising out of the Deed of Dissolution or to construe the said deed. It is also significant to note that the parties proceeded before the arbitrator on the basis that they had accepted the deed of dissolution and wanted the terms of this document to be interpreted by the arbitrator as would be evident from the recording of the arbitrator himself in this award :- "In the statement of claim, however, there was no prayer for declaration that the said deed of dissolution entered into between the parties should be cancelled and/or set aside." The aforesaid findings of the arbitrator Mr. Dipak Basu, confirm my view that the issues framed before the arbitrator regarding the deed dated 6.3.75 were for construction of the terms of the deed of dissolution and their legal effects. The second issue was about the arbitrator's own jurisdiction. 8. Normally the arbitrator is not entitled to decide the question of his own jurisdiction. But if the parties specifically refer the dispute as to the question of his jurisdiction to him, then the arbitrator must give his decision on that issue. But the arbitrator, in this case, has not decided the question of his jurisdiction in his award although the parties had gone to him with this specific Issue as will be evident from Issue No. 1 and the first limb of the issue No. 2. This is a serious omission on the part of the arbitrator which renders the award incomplete and bad in law. The arbitrator has incorporated the deed of dissolution in his award by setting out its various terms in the body of the award. Therefore, this Court has jurisdiction to look into this document. I have already recorded that going through this document I found that it did not contain any arbitration clause or any provision whereby the arbitration clause in the deed of partnership could be invoked. This is also a speaking award. Going through the deed of dissolution, the award and on account of the arbitrator's omission to decide the issue of his own jurisdiction in his award, I find that the whole reference and the award have become bad in law. This is also a speaking award. Going through the deed of dissolution, the award and on account of the arbitrator's omission to decide the issue of his own jurisdiction in his award, I find that the whole reference and the award have become bad in law. It is to be noted that in the grounds for setting aside the award in the petition, there is no ground regarding the arbitrator's omission to give his decision on the question of his jurisdiction. This omission on the part of the arbitrator has not been argued before me by any of the parties. But this being a speaking award, the omission of the arbitrator to decide the question of his own jurisdiction, inspite of framing of the issue regarding the same, is apparent on the face of the award. This being a vital issue and a pure question of law, can be considered by the Court under the general ground that the award is otherwise bad in law. Even if the parties do not take the point of jurisdiction, but the Court finds that there is complete lack of inherent jurisdiction of the arbitrator in the matter as there is no arbitration agreement, the reference will be declared to be invalid and the award a nullity. 9. In this case, very important and interesting points of law have been raised by the parties. Whether the tenancy right standing in the name of the firm can be transferred by one of the partners to the other without obtaining a written permission of the landlord under section 14(1) of the West Bengal Premises Tenancy Act, 1956? What happens if the permission is not obtained? The tenancy right being an immovable property, whether it can be transferred by one partner to the other without a registered document? Several cases have been cited at the bar on these points. In view of my findings that the arbitrators had no jurisdiction and the reference was invalid, it was not necessary for me to decide other questions raised in this application. But the points raised are so interesting that I am tempted to record my findings on these points as well. 10. I will first take up the question of registration. In view of my findings that the arbitrators had no jurisdiction and the reference was invalid, it was not necessary for me to decide other questions raised in this application. But the points raised are so interesting that I am tempted to record my findings on these points as well. 10. I will first take up the question of registration. It is contended on behalf of the petitioner Sharma that by the deed of dissolution dated 6.3.75, the tenancy right of the firm in respect of Room No. 16/3 in the premises No. 40, Strand Road was transferred to Maheswari with the intention to change the tendency from the name of the firm to the personal name of Maheswari. This being a transfer of immovable property valued at more Rs. 100/-, the deed of dissolution was compulsorily registrable under the Indian Registration Act. This deed of dissolution, not being registered, did not pass any title in respect of that room in favour of Maheswari and was inadmissible in evidence. The arbitrator should not have looked into this document at all. The counsel for the respondent Maheswari, on the other hand, contends that the share of the partners in the assets of the firm, although it may include immoveable, properties, must be treated as moveables and the assignment of the share of one partner to the other would not require registration. In support, (1) Addanki Narayanappa v. Bhaskara Krishnappa, AIR 1966 SC 1300 and (2) Commissioner of Income-tax v. Diwas Cine Corporation, AIR 1968 SC 676 are relied on by Maheswari's counsel. He submits that where the assets of the partnership consisting of immovable property are given to one of the partners by others in adjustment of their rights on dissolution of the firm, that document will not create any right, title, interest in the immovable properties in favour of the allottee partner as the assets will be treated as movables and as such the document will not require registration. He invites my attention to paragraph 2 of AIR 1966 SC 1300 where the terms agreed between the partners have been set out. The relevant portion is set out below :- "So from this day onwards, we have given up (our) share in the machine etc. He invites my attention to paragraph 2 of AIR 1966 SC 1300 where the terms agreed between the partners have been set out. The relevant portion is set out below :- "So from this day onwards, we have given up (our) share in the machine etc. and in business and we have made over the same to you alone completely by way of adjustment." In AIR 1968 SC 676 it has been held that allotment of share of one partner to another partner, on dissolution of the firm, even if the assets of the firm consist of immovable properties will not amount to sate. Sharma's counsel points out that AIR 1968 SC 676 relied on by Maheswari is not helping him at ail as the Supreme Court in that case was considering the scope and meaning of section 10(2)(vii) of the Income-tax Act, 1922 which has nothing to do with the facts of the present case. It was held in that case, relying on AIR 1966 SC 1300 , that if on a dissolution of a partnership firm, its assets containing immovable properly were allotted to one of the partners completely by way of distribution of the surplus assets in terms of section 48 of the Partnership Act, the said transaction does not amount to sale or transfer within the meaning of section 10(2)(vii) of the Income-tax Act, 1922. Sharma's counsel, however, does not dispute this proposition of law laid down in AIR 1966 SC 1300 but submits whether registration will be necessary or not will depend on the nature and terms of the transaction. He relies on (3) Ratanlal Sharma v. Purusottom, AIR 1974 SC 1066 in support of his contention that if the allotment, instead of "adjustment of rights" amounts to 'transfer' or 'assignment' of share of one partner to the other, the document become compulsorily registrable. In this case, the Supreme Court was considering the effect of the allotment of the partnership assets consisting of immovable properties to one of the partners by the arbitrator under an award. In that award, allotment of the factory etc. was exclusively given to one partner in consideration of payment of Rs. 17,000/- by the continuing partner to the outgoing partner. This award was challenged on the ground that the award required registration. In that award, allotment of the factory etc. was exclusively given to one partner in consideration of payment of Rs. 17,000/- by the continuing partner to the outgoing partner. This award was challenged on the ground that the award required registration. The Supreme Court held that if the allotment of the share of a partner to the other in the assets of the partnership firm consisting of immovable property was for consideration of money and it amounted to a 'transfer' either expressly or by necessary intendment, then registration would be necessary. The terms of the allotment made by the award in that case have been set out in paragraph 4 of AIR 1974 SC 1066 and it clearly appears there from that the allotment was made to the allottee partner absolutely in consideration of the outgoing partner receiving Rs. 17,000/- from the continuing partner. The document, therefore, became compulsorily registrable and was inadmissible in evidence due to non-registration. 11. The deed of dissolution in the present case has to be examined in the light of the principles laid down by the Supreme Court in the aforesaid cases. Coming back to the deed dated 6.3.75, I find that the terms of dissolution are as follows: (8) That the retiring partner shall be at liberty to carry on any business in any name in Room No. 16/3 in the 4th floor at 40, Strand Road, Calcutta, the tenancy being in the name of the firm M/s. Tools & Bearing Centre. (9) That the continuing partner shall not have any right over the said tenancy in respect of No. 16/3 in the 4th floor at 40, Strand Road, Calcutta. (11) That the continuing partner hereto confirms that he will assist the retiring partner in all possible manner to get the tenancy in respect of Room No. 1/s in the 4th floor at strand Road, Calcutta, transferred in his personal name, if necessary, at the cost of the retiring partner. (14) That in consideration of the sum mentioned in clause 14 received by the retiring partner from the continuing partner, the retiring partner hereto hereby confirms that he has assigned all his right, title and interest in respect of the partnership in favour of the continuing partner. 12. It should be noted that both the Room Nos. 16 and 16/3 were partnership assets. 12. It should be noted that both the Room Nos. 16 and 16/3 were partnership assets. In clause 14 of the Deed dated 6.3.75, Maheswari, for money consideration received from Sharma, as mentioned in clause 14, assigned all his right, title and interest in the partnership assets including Room No. 16, absolutely in favour of Sharma. The value of Room No. 16, certainly will be over Rs. 100/-. Therefore, on account of this absolute transfer by Maheswari of Room No. 16, for money consideration in terms of clause 14 of the deed of dissolution, the document became compulsory registrable and was inadmissible in evidence due to non-registration. Similarly under clauses 8, 9 and 11, Sharma assigned all his right, title and interest in Room No. 16/3, in favour of Maheswari. As a matter of fact, on proper construction of the deed of dissolution, it would be found that Sharma became absolute owner of the business M/s. Tools and Bearing Centre including the shop Room No. 16 upon payment of money as well as in consideration of transfer of the Room No. 16/3 to Maheswari. The transaction amounts to clear sale or assignment. Hence the deed of dissolution was registrable, otherwise, o right, title or interest would pass to Maheswari absolutely in respect of this room the value of which was certainly above Rs. 100/-. I have given my anxious thoughts on the question of registration and have arrived at an inevitable conclusion that this document is compulsorily registrable and due to non-registration this document not only became inadmissible in evidence, but it could not pass any right, title or interest in respect of these two rooms in favour of the parties to this document. 13. The next question to be decided is the scope of section 14(1) of the W.B.P.T Act, 1956 and its effect on creation of sub-tenancy or transfer or assignment of tenancy right in favour of a third party without obtaining the prior written consent of the landlord. 13. The next question to be decided is the scope of section 14(1) of the W.B.P.T Act, 1956 and its effect on creation of sub-tenancy or transfer or assignment of tenancy right in favour of a third party without obtaining the prior written consent of the landlord. For the sake of convenience, the provisions of section 14(1) of the W.B.P.T. Act, 1956 are set out below :- "After the commencement of this Act, no tenant shall, without the previous consent in writing of the landlord (a) sub-let the whole or any part of the premises held by him as a tenant or (b) transfer or assign his right in the tenancy or in any part thereof." 14. Relying on the aforesaid provisions, the counsel for the petitioner Sharma submits that the transfer of Room No. 16/3 by Sharma to Maheswari under the deed of dissolution was hit by the provisions section 14(1)(b) of 1956 Act, and was unlawful. He strongly relies on (4) Dhirendra v. Pranab Kumar, 61 CWN 887, (5) M/s. Parasuram Harnand Rao v. M/s. Shanti Prasad Narinder Kumar Jain, AIR 1980 SC 165 and (6) M/s. General Radio & Alliances v. A.K. Khader, AIR 1986 SC 1218 , as welt as an unreported judgment of the Division Bench of this Court dated 6.10.82 in (7) Inconducts Chemical (P) Ltd. v. Official Liquidator of New Industrial Chemicals (P) Ltd. (in liquidation) in support of his aforesaid contention. In 61 CWN 887, the parties used to carryon a joint family business. Dispute arose amongst the parties to the business of Binode & Co. which had its office at a tenanted room at No. 13. Dalhousie Square. A suit was filed. But prior to the institution of the suit, the landlord had terminated the tenancy agreement by serving a notice to quit. This fact was an admitted fact. In the suit, however, the Official Receiver was appointed over the assets of Binode & Co. including the tenancy mentioned above. Under an order of Court the Official Receiver sold the tenancy right in the room. During the pendency of this proceeding, the W.B.P.T. Act came into force in October, 1956 and the sale of the tenancy was held by the Official Receiver on 25.1.57 long after the Act carne into force. including the tenancy mentioned above. Under an order of Court the Official Receiver sold the tenancy right in the room. During the pendency of this proceeding, the W.B.P.T. Act came into force in October, 1956 and the sale of the tenancy was held by the Official Receiver on 25.1.57 long after the Act carne into force. Bachawat, J. held on the facts of that case that the sale, in violation section 14(1) of the Act was void. The next case relied on by the petitioner Sharma is AIR 1980 SC 1655 . The original tenant Luxmi Bank went into liquidation and the Official Liquidator was appointed liquidator of the Bank. By an order of Court, the liquidator was directed to sell the assets of the Bank including its tenancy right which was purchased by the respondent No. 1 before the Supreme Court. Validity of this sale was challenged by the appellant landlord on the ground that the transfer by the liquidator fell within the mischief of section 14 of the Delhi Rent Control Act providing that there should be no transfer of tenancy by a tenant without the written consent of the landlord as would appear from the provisions set out below :- "that the tenant has, on or after the 9th day of June, 1952, sub-let, assigned or otherwise parted with the possession of the whole or any part of the premises without obtaining the consent in writing of the landlord." To sustain the sale, it was argued before the Supreme Court that the sale was not a voluntary one but was under an order of Court by the liquidator and the sale was confirmed by the Court. Therefore, the whole transaction was outside the purview of the section quoted above. But the Supreme Court held that the liquidator had stepped into the shoes of the tenant Bank and the sale was by the liquidator on behalf of the tenant and the sale was a voluntary one. The aforesaid provisions would apply in full force. The sale being bad, the purchaser respondent No. 1 did not acquire any right and was directed to deliver possession of the tenanted premises to the appellant landlord. The third case which is cited by the counsel for the petitioner Sharma is AIR 1986 SC 1218 . The aforesaid provisions would apply in full force. The sale being bad, the purchaser respondent No. 1 did not acquire any right and was directed to deliver possession of the tenanted premises to the appellant landlord. The third case which is cited by the counsel for the petitioner Sharma is AIR 1986 SC 1218 . In this case, the tenancy right of a company was taken over by another company in a scheme for voluntary amalgamation and it was approved by an order of Court. The amalgamated new company claimed to be the lawful tenant under the landlord in respect of the tenancy concerned. But the validity of the transaction was challenged by the landlord of the premises. It was held by the Supreme Court that the transaction amounted to an assignment and came within the mischief of section 10(11)(a) of the Andhra Pradesh Building (Lease, Rent and Eviction) Control Act, 1960 forbidding transfer without the previous written permission of the landlord. The 4th case relied on by the petitioner in support of his contention that there could be no sub-setting or transfer without the previous permission of the landlord in writing is the unreported decision of the Division Bench of this Court Inducts Chemical (P) Ltd. In this case, the official liquidator was appointed liquidator of the company in liquidation. The assets of the company consisted of a tenanted premises. The landlord of the tenanted premises applied under section 531 of the Companies Act, 1956 for a direction on the liquidator to disclaim the right over the tenancy and to make over possession of the premises to the applicant landlord. The landlord lost before the Trial Court and the matter came before the Appeal Court. The Appeal Court, relying on AIR 1980 SC 655, held that due to the embargo created by section 14 of the W.B.P.T. Act, 1956, the official liquidator was not entitled to sell the tenancy right without obtaining the prior written consent of the appellant landlord. Therefore, the tenancy could not be included in the list of assets of the company in liquidation as the company had no saleable interest in the tenanted premises. Therefore, the tenancy could not be included in the list of assets of the company in liquidation as the company had no saleable interest in the tenanted premises. On the basis of the decisions mentioned above, the counsel for Sharma submits that the transfer of the tenanted Room No. 16/3 by Sharma in favour of Maheswari is hit by the embargo created by section 14(1)(b) of the W.B.P.T. Act, 1956. It is to be noted that in (8) M/s. Bagwati Builders v. Karim Bux, AIR 1977 Calcutta 319 it was also held that a sub-tenancy created in violation of the provisions of section 14(1)(b) of 1956 Act, would be void and such a sub-tenancy would not confer any right on the sub-tenant even under section 115 of T.P. Act. According to Sharma, upon construction of clauses 8, 9 and 11 of the deed of dissolution dated 6.3.75 there could be no doubt that there was a complete assignment of the Room No. 16/3 in favour of Maheswari with a clear stipulation that the tenancy in respect of that room would be transferred from the name of the partnership firm M/s. Tools & Bearing Centre to the personal name of Maheswari. The arbitrator misconstrued the document and came to the finding that on dissolution of the firm it was a mere adjustment of rights between the partners regarding the assets of the partnership. The arbitrator failed to notice that the transaction was unlawful due to the provisions of section 14(1)(b) of the Act. The award of the arbitrator is based on a wrong proposition of law which is apparent on the face of the award. This award, therefore, must be set aside. 15. The counsel for Maheswari, on the other hand, contends that a sub-letting or transfer or assignment of the tenancy right by the tenant in violation of the provisions in section 14(1)(a) and (b) of the W.B.P.T. Act, 1956 will not make the transaction illegal, unlawful or void. It only provides that the transaction will not be binding on the landlord. He submits that in 61 CWN 887, Bachawat, J. held that the transaction in contravention of the provisions of section 14(1) of the Act was void mainly because the tenancy had been terminated by the landlord by a notice to quit served on the tenants before the transaction took place and that fact was admitted by the tenants. He submits that in 61 CWN 887, Bachawat, J. held that the transaction in contravention of the provisions of section 14(1) of the Act was void mainly because the tenancy had been terminated by the landlord by a notice to quit served on the tenants before the transaction took place and that fact was admitted by the tenants. He further submits that this Court by a subsequent decision delivered by the Division Bench of this Court and reported in (9) Debabrata Mukherjee v. Kalyan K. Roy, 85 CWN 594 clearly held that the transaction in violation of the provisions u/s 14(1)(b) of 1956 Act could not make the transaction illegal but such a transaction would not be binding on the landlord. The transaction would be valid as between the parties thereto. He submits that AIR 1980 SC 1955 , AIR 1986 SC 1218 and the unreported decision in Inconduct's case strongly relied on by the counsel for the petitioner can be distinguished from the facts of the present case. In all these cases, the landlords themselves challenged the transactions and the Courts declared the transactions not to be binding on the landlords. In the present case, the transaction is not challenged by the landlord but by a party to transaction itself. According to him, as between the parties to the transaction, the transaction is valid and binding. In support of his contention, he cites 85 CWN 594. In this case, in paragraph 24, the Division Bench of this Court on construction of section 14(1) of the W.B.P.T. Act, 1956 came to the finding as follows:- "We, therefore, conclude that even when a sub-letting is without the prior consent of the superior landlord, there would be a legal relationship as between the tenant and the sub- tenant." 16. The Counsel for Maheswari points out that it is true that this Division Bench has not considered the Single Bench decision reported in 61 CWN 887 where Bachawat, J. held that the transaction would be void but this being a Division Bench decision and a subsequent one, the principle laid down in 61 CWN 887 should be deemed to have been overruled by implication. My attention was invited to paragraph 23 of this decision at page 604 which shows that this Division Bench in arriving at the conclusion that even if the transaction contravenes section 14(1), it would be a lawful transaction between the parties thereto, was deeply impressed by the principles of public policy which is generally imbedded in all Rent Acts. For that the Division Bench heavily relied on the Full Bench decision of Andhra Pradesh High Court in (10) Shankarlal Gupta's case reported in AIR 1980 AP 181 as would be evident from the passage extracted from page 604 and set out below : "The Full Bench of the Andhra Pradesh High Court in the aforesaid case had really applied the law laid down by the Supreme Court in (11) Murlidhar Aggarwal v. Ram Aggyan Singh, AIR 1974 SC 1924 under sections 3 and 7 of the U.P. (Temporary) Control of Rent and Eviction Act, 1947. Mathew, J. in Murlidhar Aggarwal's case (Supra), pointed out that the expression 'public policy' has entirely a different meaning from the policy of the law and public policy does not remain static in any given community. The Judges have, inter alia, to consider the welfare of the community at any given time. By applying this standard, we may say that the West Bengal Premises Tenancy Act which is a social legislation primarily for the welfare of the tenants do not express any intention that a sub-tenant who is inducted without the consent of the superior landlord shall have no right as against the person who had inducted him. Similarly in case it is held that such a sub-letting is totally null and void, the person inducting him would be unable to recover rent or to recover possession even when grounds for eviction exist. Therefore, the Court should avoid an interpretation on section 14 which would result in such undesirable consequence" (Paragraph 23). Obviously the Division Bench came to this conclusion by applying the principle of equitable construction and the public policy on the provisions of section 14(1) of the Act. 17. Is it desirable that a modern statute containing express and clear provisions should be construed from the point of view of equity or public policy ignoring its express provisions? Obviously the Division Bench came to this conclusion by applying the principle of equitable construction and the public policy on the provisions of section 14(1) of the Act. 17. Is it desirable that a modern statute containing express and clear provisions should be construed from the point of view of equity or public policy ignoring its express provisions? Maxwell on the Interpretation of Statutes, 12th Edn., at page 28 deals with the General Principles of Interpretation : "The length and detail of modern legislation has undoubtedly reinforced the claim of literal construction as the only safe rule." The above observation was quoted from the judgment of Lord Evenshed M.R. Then again at page 29 it is stated :- "Where the language is plain and admits of but one meaning, the task of interpretation can hardly be said to arise. The desirability or undesirability of one conclusion as compared with another cannot furnish a guide in reaching a decision. Whereby the use of clear and unequivocal language capable of only one meaning, anything is enacted by the legislature, it must be enforced however harsh or absurd or contrary to common sense the result may be. The interpretation of a statute is not to be collected from any notions which may be entertained by the Court as to what is just and expedient". .........The duty of the Court is to expound the law as it stands. In Odger's Construction of Deeds and Statutes, 5th Edn., at page 291 it is stated :- "If the words are plain, there is of course no difficulty to invoke any canon of construction". Again at page 443, it is stated :...... "If the words of a statute in themselves precise and unambiguous then no more can be necessary than to expound those words in their natural and ordinary sense. The words themselves alone do in such a case and best declare the intention of law giver". Craies on Statute Law, 7th Edn. at page 73 under the Leading Courts will not relieve against express provision's stated :- "A third consequence of this rule is that the High Court declines to interfere for the assistance of persons who seek its aid to relieve them against statutory provisions. This was clearly pointed out by Millish, L.J. in Edwards v. Edwards. at page 73 under the Leading Courts will not relieve against express provision's stated :- "A third consequence of this rule is that the High Court declines to interfere for the assistance of persons who seek its aid to relieve them against statutory provisions. This was clearly pointed out by Millish, L.J. in Edwards v. Edwards. The courts of equity have given relief on equitable grounds from provisions of Old Acts of Parliament, but this has not been done in the case of modern acts, which are framed with a view to equitable as well as legal doctrines." 18. In the above contexts, if one reads section 14(1) of 1956 Act carefully, one will immediately came to the finding that the section, in no uncertain terms, prohibits creation of a sub-tenancy transfer or assignment excepting in the manner provided in that section. This section does not say in express terms that transfer or assignment or a sub-tenancy, if created in contravention of section l4(1)(a) and (b) will not be binding on the landlord or will be unlawful. But the intention of the legislature to prohibit the act is clear and unambiguous. How can the persons, acting contrary to the provisions of this section, be said to have acquired a legal right under a contract prohibited by law? Has any court of law any jurisdiction or authority to relieve persons against express statutory prohibitions only on the ground of equitable construction or on the principle of public policy? The Courts should not, as it will defeat the provisions of the law and is forbidden by the law. It will take away the protection given to the landlord. The tenant, if he wants to create trouble, because of his bitter relationship with the landlord, may try to induct persons who are capable of creating any amount of trouble and disturbances. Moreover, an eviction suit takes long time and as such the right to evict the tenant on the ground of sub-letting in violation of section 14(1) would bring to relief to the landlord in true sense. That is why subletting in violation of section 14(1) is prohibited. If the parties, with their eyes open, enter into an unlawful transaction, the question of protection of their respective rights under the illegal contract acquires any legal right which can be protected by the Court. That is why subletting in violation of section 14(1) is prohibited. If the parties, with their eyes open, enter into an unlawful transaction, the question of protection of their respective rights under the illegal contract acquires any legal right which can be protected by the Court. The parties being in pari delicto cannot expect any assistance from the Court. 19. This 85 CWN 594 is the sheet anchor of Maheswari's counsel and he is strongly relying on this decision. This being a Division Bench decision of this Court is binding on me as well. In view of the fact that the Division Bench in Debabrata's case has interpreted the provisions of section 14 of the 1956 Act from the point of view of 'public policy', it is desirable to find out what exactly the public policy imbedded in section 14 of the Act. 20. "Public Policy" has been defined by Winfield as "a principle of judicial legislation or interpretation founded on the current needs of the community (please see Percy H. Winfield, "Public Policy in English Common Law" 42 Harvard Law Rev. 76). It obviously means that the interests of the whole public in general must be taken into consideration. But paradoxically, what happens in many of such social welfare legislations, that the interest of only one section of the public is contemplated. In that kind of social welfare legislation, most probably, the legislature expects that the Court, while interpreting the law will certainly weigh the interests of the whole community as well. The Court will have to strike a balance between the community interest and the sectional interest. It seems that the Division Bench tried to strike a balance between the landlord & the tenant in construing section 14 in the manner that the transaction in contravention of section 14(1) will not effect the jural relationship between the tenant and the sub-tenant but it will not be binding on the landlord so that the landlord can avoid the transaction. I am quite aware of the fact that this Division Bench decision is binding on me. But with great humility and due respect to this Division Bench I would like to highlight certain points which have struck me while reading this judgment for consideration of the same by the appropriate Court in an appropriate case in future. 21. I am quite aware of the fact that this Division Bench decision is binding on me. But with great humility and due respect to this Division Bench I would like to highlight certain points which have struck me while reading this judgment for consideration of the same by the appropriate Court in an appropriate case in future. 21. It would be significant to note that in 85 CWN 594, the Division Bench, very strongly relied on Murlidhar Aggarwal's case for construing section 14 in the manner it has done. But the Supreme Court in that case was construing sections 3 and 7 of U.P. (Temporary Control of Rent and Eviction) Act, 1947. Section 3 of that Act provided that when the ground for eviction would exist, the landlord would not be entitled to file the suit against the tenant without obtaining the permission of the District Magistrate. In short, it prohibited filing of a suit without such permission. In that case, the landlord and the tenant had executed a deed of lease after this Act came into force, stipulating that this Act would not apply to the said lease. Section 7(2) of that Act provided that vacancy of accommodation would be required to be reported to the District Magistrate and an order for allotment should be made in favour of the tenant by the District Magistrate. If the tenancy is created in violation of these provisions, the District Magistrate may serve notice to the tenant for showing cause within the time fixed why he should not be evicted. Section 7(2) did not prohibit creation of tenancy in violation of the provisions of section 7(2) but only entitled the District Magistrate to take steps against the tenant. What happened in that case, that the tenant did not obtain an allotment order under section 7(2) and the landlord filed eviction suit against the tenant without obtaining the permission of the District Magistrate under section 3(1) of the Act. 22. It was held by the Supreme Court in that case at page 1928, paragraph 20 :- "The language of section 3(1) is imperative and it prohibits the institution of the suit without the permission. If any landlord institutes a suit for eviction of the tenant without the permission of the District Magistrate, he commits an offence and is punishable under section 15 of the Act" (Emphasis supplied). If any landlord institutes a suit for eviction of the tenant without the permission of the District Magistrate, he commits an offence and is punishable under section 15 of the Act" (Emphasis supplied). In this case, the Supreme Court further held in paragraph 33 :- "We think that section 3 is based on public policy. We said it is intended to protect a weaker section of the community with a view to ultimately protecting the interest of the community in general by creating equality of bargaining power. Although the section is primarily intended for the protection of tenants only that protection is based on public policy." Constructing section 7(2) of that Act, the Supreme Court held in paragraph 16 :- "In (12) Udhoo Das v. Prem Prakash, AIR 1964 All 1 (FB) a Full Bench of the Allahabad High Court took the view that a lease made in violation of the provisions of section 7(2) would be valid between the parties and would create the relationship of landlord and tenant between them although it might not bind the authorities concerned." Applying the aforesaid principle laid down in AIR 1964 All 1 . 23. The Division Bench in 85 CWN 594 held that sub-tenancy in violation of section 14(1) would be valid between the parties thereto although the provisions of section 7(2) of that Act and that of section 14(1) of 1956 Act are absolutely different. Section 7(2) did not prohibit aeration of tenancy as has been done in section 14(1) of 1956 Act. Moreover, in Murlidhar's case the Supreme Court held that the agreement that the Act will not apply to the lease concerned was illegal, being hit by section 23 of the Contract Act. The Supreme Court also held that section 3(1) will app1y in full force which prohibited institution of eviction suit without the permission of the authority. Hence the landlord was not entitled to file eviction suit and the tenant was entitled to raise the defence that the institution of the Eviction Suit by the landlord without the permission of the District Magistrate under section 3(1) of the Act was unlawful and the suit was not maintainable. It was so held because section 3(1) contained a mandatory prohibition for binding the landlord from filing eviction suit is violation of section 3(1) of that Act. 24. It was so held because section 3(1) contained a mandatory prohibition for binding the landlord from filing eviction suit is violation of section 3(1) of that Act. 24. No doubt that Rent Act are enacted basically for the protection of the tenants but these Acts at times loan so much in favour of the tenants that virtually they reduce the landlords to a weaker section" in relation to their tenants. It seems while enacting 1956 Act, the legislature considered this aspect of the matter and that is why section 14(1) was enacted with the object to protect the landlords in general against undesirable persons being thrust upon them as subtenants by the tenants. Similarly, u/s. 14(2), the law has protected the tenants by prohibiting the landlord from extorting money from them. Therefore, under sections 14(1) and (2), the creation of sub-tenancy transfer or assignment by the tenant and realisation of money by the landlord from the tenants both have been expressly prohibited to protect the interest or both of the sections of the community and for creating equality of bargaining power between the two sections as will be evident from the word ‘shall’ used in both the sub-sections of section 14 of 1956 Act. Even if section 14(1) be construed from the point of view of public policy, the same construction should be put as was done by the Supreme Court in Murlidhar's case on section 3(1) of the U.P. Act as the prohibition in section 14 is in express terms and is mandatory as in section 3(1). 25. Moreover, contravention of section 14(1) has been made an offence under section 30(3) of 1956 Act, punishable with fine under the Code of Criminal Procedure. Rule 10 amended by Notification No. 5806 Law Ref. dated 22.9.61 provides that all offences committed under 1956 Act will be enquired into by the controller applying the Law of Criminal Procedure. The effect of these provisions on section 14 should be considered. But in Debabrata's case, the Division Bench held in paragraph 21 :- "In our view, section 23 of the Contract Act is not applicable to sub-letting after commencement of 1956 Act made without prior consent in writing of the landlord." 26. It is not understood why the Division Bench has excluded the operation of section 23 of the Contract Act in this case. It is not understood why the Division Bench has excluded the operation of section 23 of the Contract Act in this case. If there is any public policy under section 14(1), it was to protect the landlords. The prohibition is in express terms. Any contract, if prohibited by law or if against any public policy, section 23 of Contract Act will apply in full force. Then why section 23 will not apply? This is one aspect of the matter which puzzles me. As I am bound by this decision. I cannot disagree with it but as a Judge I think it is my duty to high light certain points from this judgment which have struck me so that the points may be considered and clarified in future when the occasion will arise. The W.B.P.T. Act, 1956 affects the right, title and interest in movable properties of large section of the community as landlords and tenants and it is extremely desirable that the law on this point he finally settled. 27. In Debabrata's case, the Division Bench also very heavily relied on (13) Monoranjan Bhattacharjee v. Satya Charan Law, 85 CLJ 81 in support of its finding that violation of the provisions of section 14(1) would not make the contract of sub-lease invalid. Reading paragraph 18 of Debabrata's case it would appear as if P.B. Mukharji, J. had held that all types of sub-letting in violation of section 11 including section 11(2) would be permitted and would not be unlawful. But a careful reading of the decision in Monoranjan's case will reveal that sub-letting in contravention of section 11(2) had been specifically held to be unlawful in this judgment. In this connection, section 11(2) is set out below : "Notwithstanding anything contained in this Act or any other law for the time being in force, it shall not be lawful after the commencement of this Act, for a tenant inferior to a tenant of the first degree to let in whole or in part the premises let to him except with the consent of the landlord and of the tenants of a superior degree above him" (emphasis supplied). Referring to section 11(2) of 1948 Act, P.B. Mukharji, J. in 85 CLJ 81 held at page 85:- "............Certain specific class of sub-letting mentioned in sub-section (2) of section 11 which is made unlawful.........." "That is the section which makes sub-letting by a tenant of a second degree unlawful except in the manner required by the statutory provision." The aforesaid finding in Monoranjan's case, has not been considered in Debabrata's case by the Division Bench although there is a striking similarity between section 11(2) of 1950 Act and section 14(1) of 1956 Act with the exception that section 11(2) expressly says that sub-letting in contravention of the statute will be 'unlawful' whereas in section 14(1) it only 'prohibits' sub-letting in contravention of that section making its breach an offence punishable with fine under the Code of Criminal Procedure. Both sections are in pari materia. In Indra Kumar Karnani's case, AIR 1966 SC 186 relied on by the Division Bench, the Supreme Court was construing sections 12 and 13 of the West Bengal Rent Control (Temporary Provisions) Act, 1950, and held in paragraph 3 at page 188/189 as follows:- "...................................................but in case of sub-tenancy by a tenant inferior to the tenant of the first degree the consent of the landlord and also of the tenant of the superior degree above him to the sub-letting is necessary if the sub-lessee is to acquire the rights of the tenant contemplated by section 13(2)." 28. Therefore, both in 85 Cal LJ 81 and in AIR 1966 SC 186 , it was expressly held that creation of a sub-tenancy must be in accordance with the provisions of the Statute concerned for making the sub-tenancy legal as between the parties thereto. Violation of the express statutory provisions would make the sub-tenancy contract unlawful and the sub-lessee will not acquire any right as a sub-tenant. But the Division Bench in 85 CWN 594 after setting out the provisions of section 14(1) of the 1956 Act held in paragraph 20:- "1 have already referred to the decision of P.B. Mukharji, J. Monoranjan Bhattacharya v. Satya Charan Law (Supra), which held that the said provisions did not make sub-letting illegal but only a penal provision preventing the person who had committed breach of such provision from claiming the protection of the benefits conferred under section 11 of the Rent Control Act, 1948. In my view, similar interpretation should be put upon section 14(1) of the West Bengal Premises Tenancy Act. Section 14(1) has not expressly laid down that a sub-letting in violation; of section 14(1) will create no legal relationship as between him and his sub-tenant. The effect of section 14(1) is that a sub-letting after the commencement of the Act without previous consent in writing of the landlord is not binding upon the superior landlord." From the passage quoted above the absence of P.B. Mukharji, J.'s comment in section 11(2) of 1948 Act, set out earlier is noticeable. In Debabrata's case, the Division Bench did not notice the finding of P.B. Mukharji, J. on section 11(2) of 1948 Act that sub-letting in violation thereof would be unlawful and the finding of the Supreme Court to the same effect in AIR 1966 SC 186 at page 188/198 set out above. Both the Courts have opened that sub-tenancy agreement would be unlawful and the sub-tenant would acquire no right if the contract is made in contravention of the statutes. 29. Normally when the statute prohibits doing certain acts or prescribes the method or the procedure of doing an act, any act contrary to the provisions of the statute will be illegal and will be unenforceable in any court of law. Craies on Statute Law, 17th Edn., page 251 states under the heading "Contract in contravention of statute creating duty" as follows: "Where a contract, express or implied, is expressly or by implication forbidden by statute, no Court will lend its assistance to give it effect." At page 252, it is stated : "The Court will not enforce a contract which is expressly or impliedly prohibited by statute. If the contract is of this class, it does not matter what the intention of the parties is, it is unenforceable whether the parties meant to break the law or not." 30. Hence the intention of the parties to the contract is immaterial. It will be illegal and void because of non-compliance of the statutory provision. At page 253 Craies says :- "It is clear that a contract is void if prohibited by a statute under a penalty, even without express declaration that the contract is void, because such penalty implies prohibition." 31. This observation applied in full force in respect of section 14(1) of 1956 Act. At page 253 Craies says :- "It is clear that a contract is void if prohibited by a statute under a penalty, even without express declaration that the contract is void, because such penalty implies prohibition." 31. This observation applied in full force in respect of section 14(1) of 1956 Act. In the above context, one has to examine the effect of the observation of the Division Bench in Dedabrata's case at page 605, paragraph 21 :- "The West Bengal Premises Tenancy Act has prohibited that a subletting shall have no effect as against the superior landlord and expresses no intention to prohibit the act of sub-letting, merely because the tenant, who sub-lets unauthorisedly, may incur punishment, it does not necessarily mean that sub-letting is forbidden by law." 32. One has to remember the provisions of sections 30(3) and 32 and Rule 10 of the 1956 Act, page 255 of Craies contains the heading-"Statutory conditions as to contract may not be waived". "But the condition in the statute may impose such terms that waiver is impossible". 33. It is to be noted that in Pulin Behari Pal v. Mahadev Dutta reported in AIR 1981 Cal 61 , it was held that when the sub-tenancy is without the written consent of the landlord, the fact that the landlord accepted rent from the tenant event after coming to know of the sub tenancy created by the tenant, will not operate as waiver. 34. In Debabata's case, the Division Bench referred to AIR 1980 AP 181 (FB) dealing with section 3(3) of Andhra Pradesh Rent Control Act and the Division Bench observed in paragraph 23 at page 604 as follows :- "These provisions required the landlord to notify the vacancy and any formation of agreement of lease contravening these provisions would be illegal and void against the Controller but the said agreement of lease is not illegal or void inter se between the landlord and the tenant. The aforesaid sections of the Hyderabad Rent Control Act and of the Andhra Pradesh Rent Control Act are not pari meteria with section 14 of the West Bengal Premises Tenancy Act. The aforesaid sections of the Hyderabad Rent Control Act and of the Andhra Pradesh Rent Control Act are not pari meteria with section 14 of the West Bengal Premises Tenancy Act. Nevertheless, these decisions are of some assistance because they indicate in what manner the applicability of section 23 of the Contract Act ought to be considered." (emphasis supplied) When the provisions of Hyderabad Act and Andhra Pradesh Act are admittedly not in pari meteria with section 1 4(1) of 1956 Act, then why same interpretation be given to these sections? In what manner the provision of two Acts assist in considering the applicability of section 23 of the Contract Act in case of section 14 of 1956 Act? 35. Whether section 23 will apply or not will depend on the express provisions of section 14 and the scheme of 1956 Act. Moreover, this Division Bench decision, relied on by the respondent's counsel will not help the respondent in any way as I have already held that the reference is invalid and the award is bad in law. 36. Maheswari's counsel then relies on (1970) Rent Control Journal 922 (Murlidhar v. Chunilal & Ors.) and submits that the firm name is only a compendious way of describing the partners. The occupation of the firm is the occupation of the partners. If one of the original partners continues to be in possession, the question of assignment or transfer cannot arise. He submits that the Room No. 16/3 was in the name of the firm occupied by the two original partners Sharma and Maheswari. Now only Maheswari will remain in possession in terms of the deed of dissolution. If Maheswari starts a new business from that room and admits other partners, still that will not amount to any assignment or transfer of the tenancy. Hence no permission of the landlord under section 14(1) of 1956 Act, is necessary and the question of registration will not arise. But in my opinion, the intention of the parties has to be gathered from the terms of the deed of dissolution itself. It will appear from the said deed that Sharma absolutely assigned all his rights, title and interest in respect of Room No. 16/3 to Maheswari because by way of consideration Sharma got the entire business and Room No. 16 exclusively and absolutely to himself. It will appear from the said deed that Sharma absolutely assigned all his rights, title and interest in respect of Room No. 16/3 to Maheswari because by way of consideration Sharma got the entire business and Room No. 16 exclusively and absolutely to himself. Maheswari assigned all his right, title and interest in Room No. 16 and the business in favour of Sharma because by way of consideration he received money and Room No. 16/3 from Sharma. The facts of the present case are quite different from the facts of the case cited before me and as such the principle laid down in that case will not be attracted in the present case. 37. Maheswari's counsel then submits in the alternative that assuming but not admitting that the deed of dissolution is illegal and void on account of contravention of the provisions of section 14(1), then the parties to the agreement must be treated as in peri delicto. The Court will not give any assistance to any of the parties to the said deed. But that question does not arise in the present case. The subject-matter of the present application under sections 30 and 33 of the Arbitration Act is the award, the validity of the reference and the conduct of the arbitrator. In this application, I am not called upon to scrutinise the conduct of the parties or the legal effect of the terms of the deed of dissolution. The petitioner has come to Court to censor the conduct of the arbitrator with the view to attack the award. Therefore, the principle of 'peri delicto' cannot be urged in this application. That point should have been agitated before the arbitrator at the time of bearing of the arbitration proceeding. But that stage is over. 38. The last point urged by Maheswari's counsel is that the parties went to the arbitrator for construction of the deed of dissolution. The construction of a document is a question of law. Therefore, the parties by agreement had referred a specific question of law to be decided by the arbitrator. When a specific question of law is referred to the arbitrator, his decision, whether right or wrong, would be binding the parties. Even if there is an error of law appeal on the face of the award, the Court will not have the jurisdiction to set aside the award. When a specific question of law is referred to the arbitrator, his decision, whether right or wrong, would be binding the parties. Even if there is an error of law appeal on the face of the award, the Court will not have the jurisdiction to set aside the award. This submission would have been unassailable if the arbitrator had the jurisdiction to hear the reference. There was no agreement between the parties for referring this specific question of law to the arbitrator for his decision is submitted by the respondent. As a matter of fact, there was no arbitration agreement at all as I had held earlier. The arbitrator has recorded that the Court by its order dated 2.3.77 directed the joint arbitrators to consider the deed of dissolution. But the Court by its order cannot confer jurisdiction on the arbitrator to arbitrate. That must be done by the parties by agreement in writing. In absence of any arbitration agreement, the order dated 2.3.77 became a nullity. For all this, I hold that the award is a nullity and must be declared to be void. Each party to pay and bear his own costs of this application.