Harbhajan Singh Vs. the Estate Officer and Others - Court Judgment

SooperKanoon Citationsooperkanoon.com/1057467
CourtPunjab and Haryana High Court
Decided OnJul-04-2013
AppellantHarbhajan Singh
RespondentThe Estate Officer and Others
Excerpt:
cwp no.3072 o”1. in the high court of punjab and haryana at chandigarh cwp no.3072 of 1990 (o&m) date of decision: july 4, 2013 harbhajan singh ...petitioner versus the estate officer and others ...respondents coram:- hon'ble mr.justice k. kannan present: mr.sd bansal, advocate, for the petitioners.none for the respondents.k.kannan, j. (oral) there is no representation on behalf of the respondents. the writ petition challenges the order of cancellation of allotment made and grant of lease for running a meat shop in the property owned by the chandigarh administration. the lease deed was executed on 3.6.1968 (annexure p/1) and one of the clauses in the lease prohibited sub- tenancy. relevant clause is re-produced as under:- “14. the lessee/s shall not sublet the said building or any part thereof or transfer his rights under this lease either directly or indirectly.” the petitioner was admittedly in possession of the property and continued at the same and he took in partnership yet another person, named ram saran dass on 10.3.1987 and entered into partnership with him. the partnership deed was also submitted to the chandigarh administration to inform them about the association of yet another person alongwith the petitioner. this gave rise to the impugned order cancelling the allotment on cwp no.3072 o”2. the ground that the partnership deed was an attempt to deceive the administration and the fact that share of profit and loss was to be made in the ratio of 10:90 for the petitioner and ram saran dass respectively, showed that literally there was a transfer of the property to a third party, but made to appear that it was a partnership deed. the case has to be considered from the point of view of what right had been granted to the petitioner and whether he had committed a breach by entering in the partnership with yet another person. the terms of the lease prohibits transfer of right and the issue of whether association of yet another person in business would amount to transfer of interest has come through several decisions in cases dealing with rent control legislation. the counsel referred me to a decision of the supreme court in helper girdharbhai versus saiyed mohamad mirasahed 1987 (2) rcr (rent) 124, where dealing with an issue whether there had been a sub- letting or transfer of interest in terms of the provisions of bombay rent, hotel and lodging house rates control act, 1947, when a tenant was entering into a partnership transaction and whether a landlord is entitled to apply for eviction, the supreme court held that a tenant forming a partnership firm and using the premises for the business of the firm shall not be taken to result in sub-letting or assignment in favour of the partnership firm or its interest, so long as the legal formulation allowed for a person to claim property as lessee without forfeiting his right by entering in the partnership. so by applying the legal principle enunciated above, the administration cannot claim that there had been any breach of the terms of allotment. the fact that the petitioner had only a minot share in the profits and that the other partner enjoyed higher percentage of profits would not cwp no.3072 o”3. amount to transfer of interest in the property. a business in the shop and showing of profits of that business cannot be taken as transfer of interest in the property held to a partner, who is associated with lessee. legal implications are different and the law recognizes the said difference. the impugned order is wrong and is quashed. writ petition is allowed. july 4, 2013 (k.kannan) prem judge
Judgment:

CWP No.3072 o”

1. IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CWP No.3072 of 1990 (O&M) Date of decision: July 4, 2013 Harbhajan Singh ...Petitioner Versus The Estate Officer and others ...Respondents CORAM:- HON'BLE Mr.JUSTICE K.

KANNAN Present: Mr.SD Bansal, Advocate, for the petitioneRs.None for the respondents.K.KANNAN, J.

(Oral) There is no representation on behalf of the respondents.

The writ petition challenges the order of cancellation of allotment made and grant of lease for running a meat shop in the property owned by the Chandigarh Administration.

The lease deed was executed on 3.6.1968 (Annexure P/1) and one of the clauses in the lease prohibited sub- tenancy.

Relevant clause is re-produced as under:- “14.

The lessee/s shall not sublet the said building or any part thereof or transfer his rights under this lease either directly or indirectly.”

The petitioner was admittedly in possession of the property and continued at the same and he took in partnership yet another person, named Ram Saran Dass on 10.3.1987 and entered into partnership with him.

The partnership deed was also submitted to the Chandigarh Administration to inform them about the association of yet another person alongwith the petitioner.

This gave rise to the impugned order cancelling the allotment on CWP No.3072 o”

2. the ground that the partnership deed was an attempt to deceive the administration and the fact that share of profit and loss was to be made in the ratio of 10:90 for the petitioner and Ram Saran Dass respectively, showed that literally there was a transfer of the property to a third party, but made to appear that it was a partnership deed.

The case has to be considered from the point of view of what right had been granted to the petitioner and whether he had committed a breach by entering in the partnership with yet another person.

The terms of the lease prohibits transfer of right and the issue of whether association of yet another person in business would amount to transfer of interest has come through several decisions in cases dealing with Rent Control Legislation.

The counsel referred me to a decision of the Supreme Court in Helper Girdharbhai Versus Saiyed Mohamad Mirasahed 1987 (2) RCR (Rent) 124, where dealing with an issue whether there had been a sub- letting or transfer of interest in terms of the provisions of Bombay Rent, Hotel and Lodging House Rates Control Act, 1947, when a tenant was entering into a partnership transaction and whether a landlord is entitled to apply for eviction, the Supreme Court held that a tenant forming a partnership firm and using the premises for the business of the firm shall not be taken to result in sub-letting or assignment in favour of the partnership firm or its interest, so long as the legal formulation allowed for a person to claim property as lessee without forfeiting his right by entering in the partnership.

So by applying the legal principle enunciated above, the administration cannot claim that there had been any breach of the terms of allotment.

The fact that the petitioner had only a minot share in the profits and that the other partner enjoyed higher percentage of profits would not CWP No.3072 o”

3. amount to transfer of interest in the property.

A business in the shop and showing of profits of that business cannot be taken as transfer of interest in the property held to a partner, who is associated with lessee.

Legal implications are different and the law recognizes the said difference.

The impugned order is wrong and is quashed.

Writ petition is allowed.

July 4, 2013 (K.KANNAN) prem JUDGE