Rajendra Kammath Vs. Anand Bai - Court Judgment

Excerpt:
- labour & services appointment: [v.k. bali, ch, p.r. raman & s. siri jagan, jj] post of pharmacist in homeopathy subordinate service - special rules for kerala homeopathy subordinate service rules, 1999 introducing new qualifications vacancy arising subsequent to coming into force of the said special rules held, vacancies have to be filled up only in accordance with special rules, 1999. unfilled vacancy that had arisen prior to amendment cannot be filled up by candidate not possessing amended qualifications prescribed by special rules. state government has the power to frame or amend the special rules with or without retrospective effect. mohanan k.r. & anr vs director of homeopathy, kerala homeopathy services, trivandrum & ors. - chacko (kumili) submitted that the rent control court and the appellate authority have clearly misunderstood the scope and ambit of section 11(4)(i) of the act and have committed an error in holding that the petitioners have recognised jacob as the tenant of the building. counsel submitted that facts would clearly indicate that respondents 1 and 2 have sublet the premises to the third respondent and there is clear transfer of right by respondents 1 and 2 to third party which is contrary to the terms of the lease deed. , (2004) 4 scc 794. 8. the appellate authority, in our view, has clearly misunderstood the scope and ambit of the explanation to section 11 (4)(i) of the act. provided that an application under this clause shall not be made for the first time in respect of one and the same tenancy unless the landlord has sent a registered notice to the tenant intimating the contravention of the said condition of the lease and the tenant has failed to terminate the transfer or the sublease, as the case may be, within the thirty days of the receipt of the notice or the refusal thereof.orderk.s. radhakrishnan, j.1. revision petitioners are the landlords of the tenanted premises which was let out to respondents 1 and 2 on 5.3.1972 for a monthly rent of rs. 75/- with a covenant against subletting or transfer of rights to third parties. rent of the building was paid upto june 1993. later it was sent by money order dated 19.8.1993 on behalf of 'payyana traders and industries'. petitioners came to know that the tenants have transferred their rights to strangers and found third respondent conducting the business in the scheduled premises. petitioners therefore sent notice dated 23.7.1993 to respondents 1 and 2 requesting them to evict the sub tenant. first respondent replied to the said notice, but no reply was sent by the second respondent.2. respondents 1 and 2 entered appearance and filed their objections. they have admitted that the tenanted premises was taken on rent from the father of the first petitioner in the year 1972. second respondent in the year 1973 withdrew from the partnership leaving the assets and liabilities to the first respondent who continued the business. partnership was later reconstituted by partnership deed dated 1.5.1973 by inducting one g.s. kakade in the place of the second respondent. partnership was again reconstituted on 18.11.1974 inducting one k.d. jacob in the place of g.s. kakade. as per cl. 4 of the dissolution deed dated 27.10.1977 all the assets of the firm were assigned to k.d.jacob. further it is stated that the landlords used to take rent from k.d. jacob without any complaint from the year 1974 to 1977 while jacob was the managing partner and from the year 1977 to 1993 when he was the sole partner and hence jacob was recognised as a tenant.3. third respondent also entered appearance stating that he is not the lessee or sublessee of the tenanted premises and that he is conducting business at a place 25 metres away from the tenanted premises. first petitioner was examined as pw.1. petitioners produced exts.a1 to a6 documents. on the side of the tenants first respondent was examined as rw.1 and third respondent was examined as r.w.2. exts.b1 to b7 documents were produced. the rent control court after perusing the oral and documentary evidence came to the conclusion that respondents 1 and 2 had already transferred possession of the building in the year 1977 to jacob and thereafter they have no connection with the scheduled premises. further it is also noted that the same business is being conducted in the scheduled premises and that the petitioners used to issue receipts in the name of payyana traders and industries and subsequently in the year 1993 landlords set up a case that respondents 1 and 2 have sublet the building to third respondent. further it was noticed that jacob, though the brother of the third respondent, was also not made party to the rent control petition and therefore the petition is defective. rent control court therefore found that the landlords could not establish the ground under section 11(4)(i) of the act and the petition was dismissed. claim under section 11(2)(b) was also not allowed.4. petitioners took up the matter in appeal. appellate authority also noticed that petitioners have received rent from jacob from the year 1977 to june 1993. consequently they were aware that jacob was conducting the business in the tenanted premises. further it was also noticed that there, was evidence in this case to show that jacob was a partner of the firm which was conducting business in the petition schedule building and so on the dissolution of the firm the entire business vested in jacob who is the other partner of the firm. consequently it was held there was no transfer of right in favour of jacob as contemplated under section 11(4)(i) of the act. on the above reasoning the order of the rent control court was confirmed by the appellate authority. aggrieved by the same, landlords have come up with the present revision petition.5. counsel appearing for the petitioners sri. chacko (kumili) submitted that the rent control court and the appellate authority have clearly misunderstood the scope and ambit of section 11(4)(i) of the act and have committed an error in holding that the petitioners have recognised jacob as the tenant of the building. counsel submitted that facts would clearly indicate that respondents 1 and 2 have sublet the premises to the third respondent and there is clear transfer of right by respondents 1 and 2 to third party which is contrary to the terms of the lease deed. on the other hand, tenants contended that there is no illegality in the order passed by the rent control court or the appellate authority to be interfered by us in our revisional jurisdiction. counsel submitted that there is acquiescence on the part of the landlords since no action has been taken by them for the last so many years and hence there is no objectionable sublease.6. the tenanted premises was let out to respondents 1 and 2 by ext.a1 lease deed dated 5.3.1972. later second respondent withdrew from the partnership in the year 1973. respondents 1 and 2 started a business in partnership under the name and style 'payyana traders and industries'. later first respondent withdrew from the partnership and the partnership was reconstituted and one kakade was included in the place of the second respondent and partnership continued under the name and style 'payyana traders and industries'. partnership was later dissolved on 12.11.1974 vide ext.b2 and as per ext.b3 k.d.jacob was inducted into the partnership in place of kakade. partnership between the respondent and jacob was later dissolved with effect from 22.9.1977. ext.b4 is the deed of dissolution between k.d. jacob and the first respondent dated 27.10.1977. first respondent accordingly released his share right, title and interest in the tenanted premises to jacob. these facts have not been disputed by the parties and so found by the rent control court and appellate authority. both rent control court and appellate authority proceeded on the basis that since jacob was inducted into partnership in the year 1977 and that landlords have not taken any steps against him it must be taken that the petitioners have waived their right. reference was made to the decision of the apex court in a.s. sulochana v. dharmalingam, air 1987 sc 242. in that case since no objection was taken for the last 18 years against subletting and that subtenant was openly in occupation of part of the building during that period, it was held sublessee cannot be evicted. we may in this connection point out that the observation made in sulochana's case was later partly overruled by the apex court in imdad ali v. keshav chand, (2003) 4 scc 635, on another point which was confirmed in parvinder singh's case, (2004) 4 scc 794 and also in ganesh shet's case, 2004 (6) supreme 415.7. the rent deed carries a covenant against alienability. respondents 1 and 2 - tenants were restrained against subletting the leasehold premises or transferring their rights to third parties. facts would indicate that respondents 1 and 2 were jointly conducting the business in the name and style 'payyana traders and industries' and later second respondent withdrew from the partnership and a new partnership was constituted with first respondent and one kakade vide ext.b1 partnership deed dated 1.5.1973 and they continued the business under the name and style payyana traders and industries. that partnership was subsequently dissolved on 12.11.1974 when kakade withdrew from the partnership. by ext.b3 agreement dated 18.11.1974 jacob was inducted into the partnership and a fresh partnership deed was drawn up by ext.b4 dated 27.10.1977. later first respondent also retired from the partnership in the year 1977, releasing of his share, right, title and interest to jacob, with the result that first and second respondents have ceased to be partners and the entire tenancy rights vested on third parties. the scheme of the rent act insists on the tenant to remain in occupation of the premises unless there is a positive covenant favouring transfer of rights. when we tear the veil of the partnership it is evident that none of the joint tenants are partners of the firm. the deed of partnership is only a device to defeat the provisions of the rent act and the covenant against subletting or transfer of rights. reference is made to the decision of the apex court in parvinder singh v. renu gautam and ors., (2004) 4 scc 794.8. the appellate authority, in our view, has clearly misunderstood the scope and ambit of the explanation to section 11 (4)(i) of the act. for easy reference, the said provision is extracted below.(4) a landlord may apply to the rent control court for an order directing the tenant to put the landlord in possession of the building,--(i) if the tenant after the commencement of this act, without the consent of the landlord, transfers his right under the lease or sublets the entire building or any portion thereof if the lease does not confer on him any right to do so:provided that an application under this clause shall not be made for the first time in respect of one and the same tenancy unless the landlord has sent a registered notice to the tenant intimating the contravention of the said condition of the lease and the tenant has failed to terminate the transfer or the sublease, as the case may be, within the thirty days of the receipt of the notice or the refusal thereof.explanation:-- where on the partition of a joint family or of the rights of co-tenants or on the dissolution of a firm, the right of the joint family or the co-tenants, or the firm under a lease is vested in a member of the joint family, or a co-tenant or a partner, as the case may be, whether by act of parties or otherwise/no transfer by the tenant of his right under the lease shall be deemed to have taken place within the meaning of this clause;the explanation was inserted by act 7 of 1966 to explain the meaning of the words, 'transfer by the tenant of his right under the lease'. the explanation states that where on the partition of a joint family or of the rights of co-tenants or on the dissolution of a firm, the right of the joint family or the co-tenants or the firm under a lease is vested in a member of the joint family, or a co-tenant or a partner, as the case may be, whether by act of parties or otherwise, no transfer by the tenant of his right under the lease shall be deemed to have taken place within the meaning of section 11(4)(i). explanation refers to vesting of rights of a joint family in a member of a joint family, or of the rights of a co-tenants on a co-tenant and on dissolution of the firm, on a partner, whether by act of parties or otherwise. in such situations no transfer by the tenant of his rights under the lease would take place. appellate authority has taken the view that since on dissolution of the firm right of the firm under the lease is vested on the remaining partner, the explanation to section 11(4)(i) would apply and therefore there will not be a transfer of right under the lease. the appellate authority, in our view, has completely misunderstood the scope of the explanation. the person in occupation of the tenanted premises necessarily be a member of the joint family, or a co-tenant or one of the partners of the firm. if on reconstitution none of the original tenant or their legal heirs remains as a partner the remaining partners would assume the status of a sub lessee. so far as this case is concerned, facts would evidently show that the tenancy was joint tenancy of which one of the joint tenants ceased to be a joint tenant and left the partnership firm by name payyana industries in the year 1975. the remaining joint tenant also retired from the partnership in the year 1977 releasing his right, share, title and interest to the remaining partner, a stranger. he has no contractual relationship between the landlord and the other partner. partners with whom landlord had contractual and legal relationship have ceased to be the partners of the firm. consequently the person in possession has become a sublessee. further rw.2 has stated he has no interest in the business in the petition schedule building and the same is being conducted by his brother k.d. jacob. section 21 of the act specifically says that the order passed under the act shall be binding on all sub-tenants under such tenant where they were parties to the proceedings or not. therefore non-implement of the alleged sublessee is of no consequence.9. sublessee has raised a contention that since the landlord has received rent from 1977 onwards from jacob he has acquired the status of a tenant and therefore there is acquiescence on the part of the landlord and consequently tenant is not liable to be evicted. receipt of rent by the landlord from the sub tenant is not a factor which goes against the landlord if the tenant violates the covenant against subletting. when there is a clear recital in the rental agreement that the tenants shall not sublet the premises or transfer their right over the tenanted premises without the knowledge or consent of the landlord, the conduct of receipt of rent cannot be put against the landlord. landlord may be eking his livelihood from the rent received from the building let out. the landlord has necessarily to get rent either from the tenant or from the person in occupation of the premises. if the landlord is not receiving the rent from the sublessee it will cause considerable prejudice to him since for recovery he will have to file a civil suit which will be another cumbersome process in our country.10. in such circumstances, the revision petition would stand allowed. the orders passed by the rent control court and the appellate authority are set aside and order of eviction is passed under section 11 (4)(i) of the act.

Judgment:
ORDER

K.S. Radhakrishnan, J.

1. Revision petitioners are the landlords of the tenanted premises which was let out to respondents 1 and 2 on 5.3.1972 for a monthly rent of Rs. 75/- with a covenant against subletting or transfer of rights to third parties. Rent of the building was paid upto June 1993. Later it was sent by money order dated 19.8.1993 on behalf of 'Payyana Traders and Industries'. Petitioners came to know that the tenants have transferred their rights to strangers and found third respondent conducting the business in the scheduled premises. Petitioners therefore sent notice dated 23.7.1993 to respondents 1 and 2 requesting them to evict the sub tenant. First respondent replied to the said notice, but no reply was sent by the second respondent.

2. Respondents 1 and 2 entered appearance and filed their objections. They have admitted that the tenanted premises was taken on rent from the father of the first petitioner in the year 1972. Second respondent in the year 1973 withdrew from the partnership leaving the assets and liabilities to the first respondent who continued the business. Partnership was later reconstituted by partnership deed dated 1.5.1973 by inducting one G.S. Kakade in the place of the second respondent. Partnership was again reconstituted on 18.11.1974 inducting one K.D. Jacob in the place of G.S. Kakade. As per Cl. 4 of the dissolution deed dated 27.10.1977 all the assets of the firm were assigned to K.D.Jacob. Further it is stated that the landlords used to take rent from K.D. Jacob without any complaint from the year 1974 to 1977 while Jacob was the Managing Partner and from the year 1977 to 1993 when he was the sole partner and hence Jacob was recognised as a tenant.

3. Third respondent also entered appearance stating that he is not the lessee or sublessee of the tenanted premises and that he is conducting business at a place 25 metres away from the tenanted premises. First petitioner was examined as PW.1. Petitioners produced Exts.A1 to A6 documents. On the side of the tenants first respondent was examined as RW.1 and third respondent was examined as R.W.2. Exts.B1 to B7 documents were produced. The Rent Control Court after perusing the oral and documentary evidence came to the conclusion that respondents 1 and 2 had already transferred possession of the building in the year 1977 to Jacob and thereafter they have no connection with the scheduled premises. Further it is also noted that the same business is being conducted in the scheduled premises and that the petitioners used to issue receipts in the name of Payyana Traders and Industries and subsequently in the year 1993 landlords set up a case that respondents 1 and 2 have sublet the building to third respondent. Further it was noticed that Jacob, though the brother of the third respondent, was also not made party to the Rent Control Petition and therefore the petition is defective. Rent Control Court therefore found that the landlords could not establish the ground under Section 11(4)(i) of the Act and the petition was dismissed. Claim under Section 11(2)(b) was also not allowed.

4. Petitioners took up the matter in appeal. Appellate Authority also noticed that petitioners have received rent from Jacob from the year 1977 to June 1993. Consequently they were aware that Jacob was conducting the business in the tenanted premises. Further it was also noticed that there, was evidence in this case to show that Jacob was a partner of the firm which was conducting business in the petition schedule building and so on the dissolution of the firm the entire business vested in Jacob who is the other partner of the firm. Consequently it was held there was no transfer of right in favour of Jacob as contemplated under Section 11(4)(i) of the Act. On the above reasoning the order of the Rent Control Court was confirmed by the Appellate Authority. Aggrieved by the same, landlords have come up with the present revision petition.

5. Counsel appearing for the petitioners Sri. Chacko (Kumili) submitted that the Rent Control Court and the Appellate Authority have clearly misunderstood the scope and ambit of Section 11(4)(i) of the Act and have committed an error in holding that the petitioners have recognised Jacob as the tenant of the building. Counsel submitted that facts would clearly indicate that respondents 1 and 2 have sublet the premises to the third respondent and there is clear transfer of right by respondents 1 and 2 to third party which is contrary to the terms of the lease deed. On the other hand, tenants contended that there is no illegality in the order passed by the Rent Control Court or the Appellate Authority to be interfered by us in our revisional jurisdiction. Counsel submitted that there is acquiescence on the part of the landlords since no action has been taken by them for the last so many years and hence there is no objectionable sublease.

6. The tenanted premises was let out to respondents 1 and 2 by Ext.A1 lease deed dated 5.3.1972. Later second respondent withdrew from the partnership in the year 1973. Respondents 1 and 2 started a business in partnership under the name and style 'Payyana Traders and Industries'. Later first respondent withdrew from the partnership and the partnership was reconstituted and one Kakade was included in the place of the second respondent and partnership continued under the name and style 'Payyana Traders and Industries'. Partnership was later dissolved on 12.11.1974 vide Ext.B2 and as per Ext.B3 K.D.Jacob was inducted into the partnership in place of Kakade. Partnership between the respondent and Jacob was later dissolved with effect from 22.9.1977. Ext.B4 is the deed of dissolution between K.D. Jacob and the first respondent dated 27.10.1977. First respondent accordingly released his share right, title and interest in the tenanted premises to Jacob. These facts have not been disputed by the parties and so found by the Rent Control Court and Appellate authority. Both Rent Control Court and Appellate Authority proceeded on the basis that since Jacob was inducted into partnership in the year 1977 and that landlords have not taken any steps against him it must be taken that the petitioners have waived their right. Reference was made to the decision of the Apex Court in A.S. Sulochana v. Dharmalingam, AIR 1987 SC 242. In that case since no objection was taken for the last 18 years against subletting and that subtenant was openly in occupation of part of the building during that period, it was held sublessee cannot be evicted. We may in this connection point out that the observation made in Sulochana's case was later partly overruled by the Apex Court in Imdad Ali v. Keshav Chand, (2003) 4 SCC 635, on another point which was confirmed in Parvinder Singh's case, (2004) 4 SCC 794 and also in Ganesh Shet's case, 2004 (6) Supreme 415.

7. The rent deed carries a covenant against alienability. Respondents 1 and 2 - tenants were restrained against subletting the leasehold premises or transferring their rights to third parties. Facts would indicate that respondents 1 and 2 were jointly conducting the business in the name and style 'Payyana Traders and Industries' and later second respondent withdrew from the partnership and a new partnership was constituted with first respondent and one Kakade vide Ext.B1 partnership deed dated 1.5.1973 and they continued the business under the name and style Payyana Traders and Industries. That partnership was subsequently dissolved on 12.11.1974 when Kakade withdrew from the partnership. By Ext.B3 agreement dated 18.11.1974 Jacob was inducted into the partnership and a fresh partnership deed was drawn up by Ext.B4 dated 27.10.1977. Later first respondent also retired from the partnership in the year 1977, releasing of his share, right, title and interest to Jacob, with the result that first and second respondents have ceased to be partners and the entire tenancy rights vested on third parties. The Scheme of the Rent Act insists on the tenant to remain in occupation of the premises unless there is a positive covenant favouring transfer of rights. When we tear the veil of the partnership it is evident that none of the joint tenants are partners of the firm. The deed of partnership is only a device to defeat the provisions of the Rent Act and the covenant against subletting or transfer of rights. Reference is made to the decision of the Apex Court in Parvinder Singh v. Renu Gautam and Ors., (2004) 4 SCC 794.

8. The appellate Authority, in our view, has clearly misunderstood the scope and ambit of the explanation to Section 11 (4)(i) of the Act. For easy reference, the said provision is extracted below.

(4) A landlord may apply to the Rent Control Court for an order directing the tenant to put the landlord in possession of the building,--

(i) if the tenant after the commencement of this Act, without the consent of the landlord, transfers his right under the lease or sublets the entire building or any portion thereof if the lease does not confer on him any right to do so:

Provided that an application under this clause shall not be made for the first time in respect of one and the same tenancy unless the landlord has sent a registered notice to the tenant intimating the contravention of the said condition of the lease and the tenant has failed to terminate the transfer or the sublease, as the case may be, within the thirty days of the receipt of the notice or the refusal thereof.

Explanation:-- Where on the partition of a joint family or of the rights of co-tenants or on the dissolution of a firm, the right of the joint family or the co-tenants, or the firm under a lease is vested in a member of the joint family, or a co-tenant or a partner, as the case may be, whether by act of parties or otherwise/no transfer by the tenant of his right under the lease shall be deemed to have taken place within the meaning of this clause;

The Explanation was inserted by Act 7 of 1966 to explain the meaning of the words, 'transfer by the tenant of his right under the lease'. The Explanation states that where on the partition of a joint family or of the rights of co-tenants or on the dissolution of a firm, the right of the joint family or the co-tenants or the firm under a lease is vested in a member of the joint family, or a co-tenant or a partner, as the case may be, whether by act of parties or otherwise, no transfer by the tenant of his right under the lease shall be deemed to have taken place within the meaning of Section 11(4)(i). Explanation refers to vesting of rights of a joint family in a member of a joint family, or of the rights of a co-tenants on a co-tenant and on dissolution of the firm, on a partner, whether by act of parties or otherwise. In such situations no transfer by the tenant of his rights under the lease would take place. Appellate Authority has taken the view that since on dissolution of the firm right of the firm under the lease is vested on the remaining partner, the Explanation to Section 11(4)(i) would apply and therefore there will not be a transfer of right under the lease. The Appellate Authority, in our view, has completely misunderstood the scope of the Explanation. The person in occupation of the tenanted premises necessarily be a member of the joint family, or a co-tenant or one of the partners of the firm. If on reconstitution none of the original tenant or their legal heirs remains as a partner the remaining partners would assume the status of a sub lessee. So far as this case is concerned, facts would evidently show that the tenancy was joint tenancy of which one of the joint tenants ceased to be a joint tenant and left the partnership firm by name Payyana Industries in the year 1975. The remaining joint tenant also retired from the partnership in the year 1977 releasing his right, share, title and interest to the remaining partner, a stranger. He has no contractual relationship between the landlord and the other partner. Partners with whom landlord had contractual and legal relationship have ceased to be the partners of the firm. Consequently the person in possession has become a sublessee. Further RW.2 has stated he has no interest in the business in the petition schedule building and the same is being conducted by his brother K.D. Jacob. Section 21 of the Act specifically says that the order passed under the Act shall be binding on all sub-tenants under such tenant where they were parties to the proceedings or not. Therefore non-implement of the alleged sublessee is of no consequence.

9. Sublessee has raised a contention that since the landlord has received rent from 1977 onwards from Jacob he has acquired the status of a tenant and therefore there is acquiescence on the part of the landlord and consequently tenant is not liable to be evicted. Receipt of rent by the landlord from the sub tenant is not a factor which goes against the landlord if the tenant violates the covenant against subletting. When there is a clear recital in the rental agreement that the tenants shall not sublet the premises or transfer their right over the tenanted premises without the knowledge or consent of the landlord, the conduct of receipt of rent cannot be put against the landlord. Landlord may be eking his livelihood from the rent received from the building let out. The landlord has necessarily to get rent either from the tenant or from the person in occupation of the premises. If the landlord is not receiving the rent from the sublessee it will cause considerable prejudice to him since for recovery he will have to file a civil suit which will be another cumbersome process in our country.

10. In such circumstances, the Revision Petition would stand allowed. The orders passed by the Rent Control Court and the Appellate Authority are set aside and order of eviction is passed under Section 11 (4)(i) of the Act.