Judgment:
V.K. Jhanji, J.
1. This is landlord's revision directed against the order of the appellate Authority, who reversed the order of the Rent Controller vide which the tenant was ordered to be ejected on the ground of sub letting.
2. The petitioner in his ejectment petition claimed ejectment of the respondents on the ground that respondents No. 1 to 3 have sublet/ tiansferred their tenancy rights in favour of respondents No. 4 and 5 without the knowledge of the petitioner in writing.
3. The petition was contested by the respondents No. 1 and 4 who in their written statement denied that respondents No. 1 to 3 have sub-let the premises to respondents No. 4 and 5. They rather stated that previously Shri Banwari Lal, father of respondent No. 1 to 3 had been doing business in the shop in question as partner with respondent No. 4 under a regular partnership deed and after the death of Banwari Lal, business of partnership was continued by respondents No. 1 and 4 in the same shop under a partnership-deed dated 29th of December, 1977. They further stated that respondent No. 5 has nothing to do with the shop in dispute or the business co ducted therein. The ejectment of the tenants was also sought on the ground that respondents No. 1 to 3 ceased to occupy the premises for a continuous period of four months.
4. The Rent Controller ordered ejectment after finding that the partnership deed set up by the respondents is a sham transaction, created to cover the act of subletting. However, the finding with regard to cease to occupy the premises was returned in favour of the respondents. On appeal by the tenants, the finding of the Rent Controller on the ground of sub letting was set aside and consequently, the ejectment petition of the landlord was dismissed. The landlord has now impugned the order of the appellate Authority in this revision petition.
5. Mr. Ajay Mittal, Advocate, learned counsel for the landlord contended that respondent No. 4 is in exclusive possession of the tenanted premises and the alleged partnership deed is a Sham transaction and is only a camouflage. In support of his arguments, he placed reliance upon judgments of this Court in Ramji Lal alias Ramji Dass and Anr. v. Smt. Naurati Devi, (1990-2) 98 P. L. P. 400. Basant Kaur and Ors. v. Shanti Devi and Ors., (1991-1) 99 P. L.R. 115 and Hazara Lal v. Lachhmi Chand, (1991-2) 100 P. L. R. 85.
6. On the other hand, Ms Alka Sarin, Advocate, counsel for the tenants has defended the order of the appellate Authority by placing reliance upon decision of the Supreme Court in Helper Girdharhhai v. Saiyed Mohmad Mirasaheb Kadri, A. I. R. 1987 S. C. 1782.
7. The only question involved in the present revision petition is whether there is a genuine partnership between respondents No. 1 and 4 or the same is a Sham transaction, created to cover the act of subletting. In order to determine this, the Court has to examine all the incidents of relationship between the parties as evident from the partnership-deed itself, from surrounding circumstances at the time when the partnership was entered into. In order to ascertain whether the parties have formed a valid, legal and genuine partnership, the reai intention of the contracting parties appearing from the whole transaction is also to be ascertained. In a given case, some persons may unite and say that they are partners with a view to circumvent the Rent Laws, while in the actual sense, the said partnerships may be fictitious. The Supreme Court in Helper Girdharbhai's case (supra) while discussing the essentials of partnership, considered the scope of Sections 4 and 6 of the Indian Partnership Act. 1932 (hereinafter referred to as 'the Act') and held as under :--
'In order to establish partnership :
(1) there must be an agreement entered into by all parties concerned.
(2) the agreement must be to share profits of business and
(3) the business must be carried on by all or any of the persons concerned acting for all.'
The Supreme Court further approved the decision of Gujarat High Court in Mehta Jagjivan Vane Chand v. Doshi Vane Chand Harakh Chand, A. I. R. 1972 Guj 6. wherein it was held 'that the mere fact that tenant entered into a partnership and allowed the premises being used for the benefit of partnership does not constitute assignment or subletting in favour of the partnership firm entitling a landlord to recover possession.'
8. Considering the facts of the present case in the light of aforesaid principles, I am of the view that respondents No. 1 and 4 have successfully proved on record that partnership between them is not a camouflage or a Sham transaction, but is a genuine partnership. Counsel for the petitioner has not seriously disputed the partnership between Banwari Lal and respondent No. 4. Banwari Lai who took the premises on rent. entered into partnership with respondent No. 4 on Ist of May, 1977. The partnership-deed as executed between them has been placed on record as Exhibit R-1. It gives reasons as to why Banwari Lal entered into partnership with respondent No. 4. It has been recited therein that he was finding it difficult to carry on the business on account of his ill health and also due to paucity of funds. Both of them agreed to share profit and loss to the extent of 35:65. Banwari Lal died on 26.6 1977. Thereafter, on 29.12.1977, respondent No. 1, who is one of the sons/heirs of Banwari Lal, executed a partnership-deed with respondent No. 4. In the partnership deed dated 29.12.1977. Exhibit R-2, it has been mentioned that father of respondent No. 1 was earlier carrying on the business in the partnership with respondent No. 4 and on his death, the business of erstwhile partnership was continued by respondents No. 1 and 4 on the same terms and conditions. According to the terms of the partnership respondents No. 1 and 4 agreed to share profit and loss to the extent of 35:65. By other clauses of the agreement, it was agreed upon that the entire business will be looked after by respondent No. 4 as respondent No. 1 had no experience about the work of business. The partnership was to be continued under the name and style of 'Chhabra Disposal Store'. Exhibit R-2 further shows that respondent No. 1 at the time of execution of partnership-deed, was resident of Rohtak whereas respondent No. 4 was the resident of Ambala Cantt where the tenanted premises are situated. In order to prove that it was an effective partnership and not a camouflage, as alleged by the petitioner respondents No. 1 and 4 have proved on record Exhibit R-3 trading account for the year 1977-78, balance-sheet for the year 1977-78. and Exhibit R-4 trading account for the year 1978-79, and balance-sheet for the year 1978-79. In Exhibit R-3, in the column of capital account, investment of respondent No. 4 is shown to be Rs. 9845-40, whereas investment of Banwari Lal is shown to be Rs. 1880-35 P. In Exhibit R-4, in the capital account of respondent No. 1, share of his father was transferred to his account and after adding the net profits of Rs. 1657-05 P. a sum of Rs. 3537-40 P is shown in the capital account of respondent No. 1. In the capital account of respondent No. 4, the last balance coincides with the amount shown in the balance-sheet for the year 1977-78 (Exhibit R-3). His share of net profit is shown to be Rs. 3077-80 P, and after withdrawal of Rs. 3536-00 P, the total balance is reflected as Rs. 9396-78 P. It is thus, apparent that the shop was taken on rent by Banwari Lal in his individual capacity. During his life-time, he entered into a partnership with respondent No. 4. On his death, business was being carried on by one of his sons, who was his legal heir, with respondent No. 4. The fact that, respondent No. 1 entered into partnership and agreed to share profit and loss only to the extent of 35:65; he shifted to Rohtak, and the account books are to be maintained by respondent No. 4, does not make the partnership a bogus one. To my mind, it is a case of contisuing of earlier partnership and for that reasons, no fresh investment was made by respondent No. 1. The other circumstance that respondent No. 1 is not residing at Ambala Cantt. where the tenanted premises are situated, but has shifted to Rohtak, is also not enough to conclude that respondent No. 1 has transferred his rights in the tenanted premises to respondent No. 4 In this case, sub-letting cannot be inferred because respondent No. 1 is not only sharing profit and loss to the extent of 35:65, but is also having control over the business. The judgments cited by the learned counsel for the petitioners are not at all applicable to the facts of the present case as the same were decided on the basis of facts and circumstances of each case.
As a result thereof, the revision petition is dismissed. However, the parties are left to bear their own costs.