IN THE HIGH COURT OF KERALA AT ERNAKULAM
CRP No. 1732 of 2001(B)
1. KALYANI BHARATHAN
... Petitioner
Vs
1. N. ABDUL MUTHALIF
... Respondent
For Petitioner :SRI.N.L.KRISHNAMOORTHY
For Respondent :SRI.V.CHITAMBARESH
Coram
Dated : 14/12/2004
O R D E R
.SP 2
…..L…….T………T…….T…….T…….T…..T…J
M.RAMACHANDRAN & V.RAMKUMAR, JJ.@@
jAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
—————————-@@
j
C.R.P.NO.1732/2001@@
j
—————————-@@
j
DATED: 14TH DECEMBER, 2004@@
j
ORDER@@
jAAAAA
((HDR 0
C.R.P.1732/2001
:#:
))
.HE 1
V.Ramkumar, J@@
CCCCCCCCCCCCC
Respondents 1,2,5 and 4 respectively in a
petition for eviction filed as R.C.P. 39/1990 before
the Rent Control Court, Palakkad, are the revision
petitioners herein. The said R.C.P. was filed by
the first respondent herein for eviction of the
respondents (6 in number) to the said R.C.P. on the
ground of sub lease falling uder section 11(4)(i) of
the Kerala Building (Lease and Rent Control ) Act,
1965 (hereinafter referred to as the Act).
2. For the sake of convenience, the parties
will hereinafter be referred to according to their
rank before the Rent Control Court.
3. The Rent Control Court, after trial, as
per order dated 19-12-1992, ordered eviction under
section 11(4)(i) of the Act. Aggrieved by the order
for eviction respondents 1 to 3 and 5 filed an appeal
before the Rent Control Appellate Authority, Palakkad
as R.C.A.No.6/1993 and as per judgment dated 5-3-2001
the appellate authority dismissed the appeal
confirming the order for eviction. Hence the present
revision.
4. We heard Advocate Sri.N.L.Krishnamoorthy,
the learned counsel appearing for the revision
petitioners and Advocate Sri.V.Chithambaresh, the
learned counsel appearing for the first
respondent/landlord.
5. Assailing the orders for eviction,
Sri.N.L.Krishnamoorthy made the following submissions
before us:
The original lessee of the petition schedule
shop room was one Bharathan Vaidyar who was an
ayurvedic physician. He was running an ayurveda
oushadasala in the petition schedule premises which
is a shop room in a line building. While so, the
present landlord’s brother filed a petition for
eviction against all the tenants on the ground of
reconstruction. Even though the matter was fought up
to High Court and an order for reconstruction was
secured by him, the same could not be executed due to
the town planning restrictions which were
subsequently enforced. In the meanwhile, the
original tenant Bharathan Vaidyar expired and his
tenancy rights devolved on respondents 1 to 6 who are
his widow and children. Since none of the legal
heirs of Bharathan Vaidhyar had the necessary
qualifications to run the Oushadasala, they had to
necessarily look for other avocation in life. It was
under these circumstances that the first and 3rd
respondent together started a restaurant under the
name and style of `Hotel Surya’. Since they did not
have the necessary experience or expertise in
conducting the said business a partnership was formed
by the 3rd respondent with one Ramankutty Gupthan as
per Ext.B1 partnership dated 19-5-1985 for a period
of 5 years from 11-05-1985 onwards. But the payment
of rent rates and taxes including electricity and
other charges was continued to be made by the 3rd
respondent who retained the dominion over the
premises. The licence for the business was also in
the name of the 3rd respondent who was only learning
the trade. While so, the landlord who got frustrated
for not being able to get vacant possession of the
premises pursuant to the original R.C.P. filed in
the year 1975, caused to be sent Ext.A1 lawyer notice
dated 23-4-1990 to the first respondent (widow of
Bharathan Vaidhyar) alleging that respondents 1 to 6
have sub let the premises to a stranger. The name of
the stranger was not disclosed in the said notice.
Ext.A2 reply notice dated 17-5-1990 was sent to the
landlord stating the true facts and also informing
him that there was no sub lease but only a
partnership which also was dissolved and that the
restaurant was now run by respondents 1 and 3. In
spite of that, the landlord filed the present
R.C.P.39/1990 alleging subletting to a stranger whose
name was not revealed in the Rent Control Petition as
well. Along with the Rent Control Petition the
landlord took out an ex-parte commission on
28-6-1990. The Advocate Commissioner who filed
Ext.C1 report dated 13-7-1990 has stated that he did
not see any of the children of Bharathan Vaidyer in
the premises but saw the three sons of Ramankutty
Gupthan conducting the hotel and one of them told the
commissioner that Ramankutty Gupthan who was on that
day laid up was running the hotel. It was no part of
the Commissioner’s function to submit such a report
which contains only hearsay evidence. The
respondents had filed detailed objection to the
Commissioner’s report. Even after the receipt of
Ext.A2 reply notice and the filing of Ext.C1 report,
the landlord did not amend the Rent Control Petition
to implead Ramankutty Gupthan nor did the landlord
incorporate a plea that Exts.B1 and B21 as per which
the partnership with Ramankutty Gupthan was started
and later dissolved, are sham documents. It was for
the first time when the landlord mounted the witness
box as PW1 that he came out with the case that
Ramankutty Gupthan was the stranger in whose favour
the tenants had parted possession. The non-mention
of the name of the alleged sub-lessee both in Ext.A1
notice and in the Rent Control Petition has not only
caused a serious breaches to the tenants in shaping
their defence, it will also render the proceedings
defective and invalid. It is now well settled that
the act of the tenant forming a partnership with
another for the conduct of the business in the
tenanted premises does not amount to transfer of his
rights under the lease or subletting so as to attract
Sec.11(4) (i) of the Act. At any rate, by virtue of
the proviso to Sec.11(4) (i) of the Act as
interpreted in Leela v. Ali & Others 1982 KLT 685,@@
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
the tenant has the right to terminate the
objectionable sub lease upon receipt of statutory
notice and a ground for eviction under the above
provision will enure to the landlord only, if, even
after the statutory period of 30 days, the tenant
does not terminate the objectionable transfer or sub
lease and the same subsists even after the expiry of
the statutory period of 30 days. By Ext.B21 document
the partnership business was terminated by the tenant
and the landlord was also informed of the same as per
Ext.A2 reply notice. Except for the solitary
evidence of the landlord examined as PW1 and the
report of the ex parte Commission, there was no
independent evidence adduced by the landlord to
substantiate the plea of sub letting. Hence the
orders of the Rent Control Authority overlooking
these vital aspects cannot be sustained.
6. We are afraid that we find ourselves
unable to agree with the above submissions. The
tenanted premises which is the subject matter of
these proceedings is a shop room in a line building
on the southern side of the market road in Koppam
amsom of Palakkad town. The original lessee of the
petition schedule shop room was one Bharathan
Vaidhyar who was conducting a vaidhyasala selling
ayurvedic medicines and preparations. It is true
that the then landlord had filed petition for
eviction of the tenants in the said line building and
R.C.P.99/1975 was the one filed against Bharathan
Vaidhyar. Eventhough the landlord succeeded in the
said attempt by getting an order for eviction on the
ground of reconstruction under section 11 (4)(iv) of
the Act, on account of the subsequent implementation
of the town planning scheme in that area the landlord
was not able to get a revised plan and licence
approved in accordance with the town planning scheme
and the line building could not be reconstructed.
That need not in any way affect the bona fides of the
present rent control petition filed as R.C.P.39/1990
on the ground of sub letting which is a totally
different cause of action. If the plea of the
landlord that the legal heirs of Bharathan Vaidyar
(who died in the meanwhile) have either parted with
their possession of the premises or have sublet the
premises so as to attract Sec.11(4)(i) of the Act is
upheld, then the landlord will be entitled to an
order of eviction notwithstanding the dismissal of
R.C.P. 99/1975.
7. There is no dispute that the lease in
favour of Bharathan Vaidhyar did not confer on him
any authority to transfer his rights under the lease
or sublet the whole or any portion of the premises
without the consent of the landlord. It is true that
neither Ext.A1 notice nor the Rent Control Petition
discloses the name of Ramankutty Gupthan who was the
alleged sub lessee to whom the tenants are said to
have sublet the premises. First of all, the landlord
examined as PW1 has stated that he got the name of
Ramankutty Gupthan only after the filing of Ext.C1
report by the Advocate Commissioner. Secondly, the
non-mention of the name of the alleged sub lessee
does not invalidate or vitiate the notice. (vide@@
AAAAA
Mini vs. Leela 2004 (1) KLT 195). In fact, the@@
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
relevant provisions of the Act do not give any
importance to the transferee or sub lessee as the
case may be. Even the proviso to Section 11(4)(i) of
the Act only obliges the landlord to send a
registered notice to the tenant intimating the
contravention of the prohibition in the lease against
transfer or subletting and providing an opportunity
to the tenant to terminate the transfer or sub lease,
as the case may be. The emphasis in the above
provision is on the objectionable conduct of the
tenant in committing breach of the terms of the lease
and not on the objectionable presence of the sub
lessee. That is presumably the reason why under sec.
21 of the Act a specific provision is made that an
order for eviction of a tenant shall be binding on
the sub tenant also whether he is a party to the
proceedings or not.
8. The right of the tenant under the lease
is to enjoy the tenanted premises on payment of rent
to the landlord. (See paragraph 9 of 2004 (1) KLT@@
AAAAAAAAAAAAAA
195 supra). When a stranger other than the tenant is@@
AAA
found in the tenanted premises, primarily it is for
the tenant to explain the jural relationship between
the tenant and such stranger because the arrangement
under which such stranger happens to be in physical
possession of the premises is one which is within the
exclusive knowledge of the tenant. In such a
situation the burden is on the tenant to show that
there is no sub lease or transfer of possession. If
the tenant fails to discharge the said burden, the
court can draw its own inference on facts. (Joginder@@
AAAAAAAAA
Singh Sodhi v. Amar Kaur 2004(8) Supreme 74). The@@
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
mere fact that the licence for the trade is in the
name of the tenant cannot rule out the possibility of
another person being in possession. (Vide Unni Vacco@@
AAAAAAAAAAAAAAAA
v/s. Thankamma Greogory and Others – 2003 (2) KLJ@@
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
(NOC) 5). The landlord does not and is also not@@
AAAAAAAAA
expected to know the nature of the private
arrangement between the tenant and the person found
in the premises. In this case the landlord has in
unmistakable terms stated in Ext.A1 that the tenants
have parted with their possession to a stranger. In
answer to the said notice the stand that was taken by
the tenant in Ext.A2 reply notice was that the
arrangement was not subletting as alleged in Ext.A1
notice but a partnership which has been terminated
and at present respondents 1 and 3 alone are
conducting the hotel. The tenants, however, did not
disclose in Ext.A2 the name of the partner or the
details of the partnership or the mode by which it
was terminated. Under these circumstances the
failure to mention the name of the alleged sub-lessee
in the Rent Control Petition cannot be fatal.
Similarly, the failure to supply the name of the sub
lessee and the failure to impugn Ext.B1 partnership
deed as a sham document by amending the pleadings,
also cannot be fatal to the landlord. It is well
settled that in rent control proceedings a liberal
and realistic approach and not a pedantic approach
should be made while construing the pleadings. (Vide@@
AAAAA
Thankappan v. Reji Xavier 1995 (1) KLT (SN) 10,@@
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
Subbiah Reddiar v. Chinnamma 1991 (2) KLT 461 and@@
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
Ram Narain Arora v.Asha Rani 1999 (1) SCC 141). A@@
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
meticulous analysis of pleading which may lead to
failure of justice is not expected to be adopted.
(Vide Madhavan v. Leelamma – 1991 (2) KLT 32)@@
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
9. In paragraph 5 of the R.C.P. it has been
unequivocally alleged that the respondents are
understood to have either transferred their rights
under the lease or sublet the leasehold to a 3rd
party who has been running therein an eating house
under the name and style of `Hotel Surya’, that none
of the respondents is seen in the premises nor are
they associated with the actual conduct of the
business being carried on there, that it is the 3rd
party who is conducting the hotel business and who is
in exclusive possession of the leasehold and that the
respondents have no manner of control over or
possession of the premises nor any interest in the
business carried on therein. According to us Ext.A1
notice and the aforementioned averments in the R.C.P.
clearly satisfy the legal requirements which the
landlord is expected to satisfy.
10. In a case as the present one where after
receipt of the statutory notice the tenant terminates
the objectionable arrangement, it may not be
necessary to examine the nature of such arrangement
because the landlord will be entitled to file a
petition for eviction only if the objectionable
arrangement still subsists even after the expiry of
30 days from the date of the statutory notice. But
the definite stand which the respondents have taken
is that there was no sub lease or parting of
possession but there was only a partnership which is
permissible in law and even that partnership was
terminated on receipt of Ext.A1 notice. It is here
that Ext.C1 report of the Advocate Commissioner
assumes great importance. No doubt, it was an ex
parte Commission. No landlord who alleges subletting
or non-user of the tenanted premises by the tenant
can expect to prove the same by taking out a
commission after notice to the tenant. This is
because in such a contingency the tenant can very
well stagemanage the situation and temporarily cause
disappearance of the objectionable contravention by
him. Eventhough the respondents filed objections to
Ext.C1 report and also subjected CW1 the Commissioner
to a searching and incisive cross-examination,
nothing has been brought out to shake the credibility
of the Commissioner who has inter alia stated in
Ext.C1 report that when he inspected the `Surya
Hotel’ building on 28-6-1990 at 4 p.m. one P.R.Rajan
who is one of the sons of Ramankutty Gupthan was
conducting hotel business, that besides P.R.Rajan
there were one P.R.Pradeep and P.R.Nanda Kumar who
are brothers of the said P.R.Rajan present in the
premisses, that none of the six respondents to the
R.C.P. was present there and that there were
customers taking tea and food from the restaurant
where four workers by name Ramankutty Nair, Mohanan,
Sulaiman and Sudheesh were found engaged in doing
their work. On enquiry by the Commissioner the three
sons of Ramankutty Gupthan told him that they were
conducting the hotel business on behalf of their
father Ramankutty Gupthan to whom the disputed
building was entrusted by the 3rd respondent and that
their father Ramankutty Gupthan was at that time laid
up and taking rest in their house at Kadampazhipuram.
If as a matter of fact, the partnership business
which the tenants claimed to have started along with
Ramankutty Gupthan as per Ext.B1 partnership deed
dated 19-5-1985 was actually terminated on 14-5-1990
as per Ext.B21 as the tenants would contend, then
there was absolutely no business for any of the sons
of Ramankutty Gupthan to conduct the restaurant on
28-6-1990 when the Commissioner visited the premises.
Ext.C1 not only demonstrates that the partnership
deed was merely a “make-believe” or a subterfuge but
also suggests that notwithstanding Ext.B21
termination, the earlier arrangement by which
Ramankutty Gupthan was given a free hand in the
restaurant business and the premises was being
continued and the respondents had virtually faded
into insignificance. The decision reported in
2004(4) SCC 794 shows that there also the report of@@
AAAAAAAAAAAAAAA
the Commissioner was relied on to hold that the
partnership was a mere cloak. It is in this context
that Ext.B1 partnership deed assumes relevance. A
perusal of the recitals in Ext.B1 partnership deed
(which is not seen registered with the Registrar of
Firms) will show that the only investment of the 3rd
respondent was the offering of the lease hold
premises valued at Rs.65,000/where as the investment
of Ramankutty Gupthan was Rs.65,000/in cash. What is
more interesting is the stipulation in Ext.B1 that
even if the joint venture was to run at a loss, the
3rd respondent was assured a fixed amount of Rs.50/-
per day on all the six working days and Rs.20/per day
on all holidays. Such an arrangement without any
sharing of loss by one of the partners but ensuring
an assured income to him even in the event of loss,
can only be treated as a device carefully invented to
ensure consideration to the tenant for allowing the
premises to be used for conducting a restaurant. It
is well settled that courts can lift or pierce the
veil of partnership set up as a camouflage to
circumvent the provisions of the Rent Control Act.
(Vide Libi v. Devassy 2002 (3) KLT 685 Paragraphs 5@@
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
and 11 and 2004 (4) SCC 794 paragraphs 8 and 9).@@
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
10. There is yet another circumstance which
fortifies the fact that Ext.B1 partnership was just a
smoke screen put up with a view to cover up the real
truth that it was Ramankutty Gupthan who was
conducting the hotel to the exclusion of the
respondents. PW2 who was the manager of the Palakkad
branch of Lord Krishna Bank proved Ext.X1
hypothecation agreement and Ext.X2 sanction letter,
has deposed before court that the loan for `Surya
Hotel’ was sanctioned and the movables scheduled to
Ext.X1 were hypothecated on 28-8-1987 on the premise
that the said hotel absolutely belonged to Ramankutty
Gupthan. It was not revealed to the bank that the
hotel business carried on in the petition schedule
shop room actually belonged to the partnership firm
said to have been constituted as per Ext.B1. So
Ext.B1 arrangement was only a mirage conceived of for
the only purpose of hoodwinking the landlord.
11. The finding of the authorities is that
Ext.B1 was nothing but a disguise invented by the
tenant to camouflage the real state of affairs. Such
a concurrent finding recorded by the authorities
below is a finding of fact (vide P.A. Thomas and@@
AAAAAAAAAAAAAAAAAAAAA
Another v. M.Mohammed Tajuddin and Another – 1996@@
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
(6) SCC 399 and Patel Valmik Himatlal and Other v.@@
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
Patel Mohanlal Muljibhai – 1998 (7) SCC 383). The@@
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
fact that the licence continued to be in the name of
the tenant, in such circumstances, is of no avail to
the tenant. (Vide 2003 (2) KLJ (NOC) 5). The@@
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
jurisdiction of this court to interfere with such
concurrent finding of fact based on evidence is very
limited. (Vide Patel Valmik Himathlal and Others@@
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
v.Patel Mohanlal Mujibhai 1998 (7) SCC 383. We@@
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
therefore do not find any illegality, irregularity or
impropriety in the impugned orders so as to warrant
interference under Sec. 20 of the Act.
This Revision which is devoid of any merit is
accordingly dismissed with costs.
M.Ramachandran,
Judge
V.Ramkumar,
Judge.
(P.T.O)
.PA
Soon after pronouncement of the order, the
learned counsel for the revision petitioners prayed
for time to surrender vacant possession of the
premises. Even though the learned counsel for the
landlord stoutly opposed the prayer contending that
the sub-lessee is not entitled to make any such
request, we are inclined to grant two months time to
the revision petitioners to surrender vacant
possession of the premises provided they file an
undertaking to that effect before the Executing Court
within two weeks from today.
Sd/-
M.Ramachandran,
Judge
Sd/-
V.Ramkumar, Judge
ani.
M.Ramachandran,
&
V.Ramkumar, JJ.
C.R.P.No.1732/2001
Order
Dated, 14th Dec.2004
.PA
.PA
=========================
V.RAMKUMAR, J.
NO.
JUDGMENT
DATED:
=========================