PETITIONER: SHANTIBAI Vs. RESPONDENT: DINKAR BALKRISHNA VAIDYA DATE OF JUDGMENT02/03/1994 BENCH: MOHAN, S. (J) BENCH: MOHAN, S. (J) MUKHERJEE M.K. (J) CITATION: 1994 SCC (4) 85 JT 1994 (2) 187 1994 SCALE (1)836 ACT: HEADNOTE: JUDGMENT:
The Judgment of the Court was delivered by
S. MOHAN, J.- The short facts leading to this civil appeal
are as under.
2. The suit property was originally owned by Trimbak Hari
Awate. He executed a simple mortgage on April 28, 1947 to
an extent of 11,000 square feet which represented the entire
property for a sum of Rs 20,000 in favour of Dinkar S.
Vaidya. On or about July 7, 1948, Awate executed a lease
deed in favour of Shankar Godaji Gore. The purpose
mentioned in the lease deed was residence and shops. Under
the lease deed, the lessee was authorised to sub-lease. The
period of lease was 25 years. The annual rent was Rs 1500
payable monthly at the rate of Rs 125. There was no
prohibition from the assignment in the said lease.
3. On February 17, 1949, Shankar Godaji Gore, the lessee
executed a registered sub-lease in respect of entire land in
favour of two persons Sulochanabai Thakur and Krishnabai
Sarde, original defendants 2 and 3. The sub-lease was for a
period of 99 years and 9 months. The monthly rent was fixed
at Rs 50. Defendants 2 and 3 the sub-lessees constructed
fourteen shops on a portion of the land, sublet to them.
These shops were let out for rent to several persons. They
in their turn assigned their interest to different persons.
On November 7, 1949, an area of 4000 sq. ft. was sublet by
defendants 2 and 3 in favour of Sardar Biwalkar on a rent of
Rs 135 p.m. for a period of 67 years. On the same day of
the lease, defendants 2 and 3 sold seven out of fourteen
shops to Biwalkar. On December 6, 1952, defendants 2 and 3
assigned all their rights, title and interest in respect of
the suit land in favour of Bayajabai Ganpat Gore, Sundarabai
Babasaheb Gore and Yashodabai Balasaheb Gore, defendants 6,
7 and 8 respectively.
4. In 1952, Dinkar Balkrishna Vaidya, the mortgagee filed
a suit being Special Civil Suit No. 89 of 1952 for
enforcement of mortgage. In that suit, mortgagor Awate and
defendants 1 to 4 were made party-defendants. Thai suit was
decreed. In execution of the final decree in the auction,
the mortgagee Dinkar Balkrishna Vaidya himself came to
purchase the suit land measuring about 1000 sq. ft. The
sale was confirmed on December 19, 1957. Symbolical
possession was granted on March 2, 1960. It appears that
during the pendency of the suit, mortgagee was declared a
lunatic. Therefore, Nazir of the court was appointed as
guardian and the property was taken possession of by the
Nazir under the provisions of Court of Wards Act.
5. The Nazir filed Regular Civil Suit No. 1142 of 1965 in
the Small Cause Court, Poona for recovery of possession and
arrears of rent since his demand for rent from Shankar
Godaji Gore was not complied with. Shankar Godaji Gore
assigned his right, title and interest in the shop premises
to
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defendants 19 and 20. Likewise, on August 27, 1963
defendant 5 assigned his right, title and interest in the
shop in favour of defendant 21. Therefore, another ground
of sub-letting was also added. That suit was decreed on
November 27, 1968. Aggrieved by the said judgment, Civil
Appeal Nos. 279, 354 and 265 of 1969 were preferred against
the same. Civil Appeal Nos. 279 and 354 of 1969 came to be
allowed while Civil Appeal No. 265 of 1969 was dismissed for
non-prosecution. Thereupon, the first respondent moved the
High Court under Article 227 of the Constitution of India.
That was numbered as Special Civil Application No. 242 of
1973. By the impugned order dated July 15, 1980, that came
to be allowed. Hence, the present civil appeal.
6. The learned counsel for the appellants Shri U.R. Lalit
after taking us through the relevant provisions of the
Bombay Rents, Hotel and Lodging House Rates Control Act,
1947 (hereinafter referred to as ‘the Act’) submits that the
lease deed in favour of Shankar Godaji Gore specifically
enabled him to sublet. Under the lease deed dated July 7,
1948, Awate the original owner permitted the lessee Shankar
Godaji Gore to construct therein and give the said building
or any portion thereof to any person on lease rent and he
could take the income derived therefrom. Therefore, there
was clear enablement to sub-lease.
7. Under the Transfer of Property Act, there is no bar for
a lessee to sublease. In such a case that right or interest
could be assigned in favour of third party. That was what
was done by the lease-deed dated February 17, 1949. The
sub-lessees constructed the building and let out a few and
assigned their rights in favour of other defendants. If the
sub-lessees continued in possession prior to May 21, 1959,
they would be entitled to the statutary protection because
prior to 1959, if there was subletting, the landlord could
not proceed to evict. Section 15 of the Act barring sub-
leases came into force only by amendment Act 49 of 1959,
that too, subject to the contract to the contrary. Here is
a case of a contrary contract. Under these circumstances
the ruling reported in Sardar Tota Singh v. Gold Field
Leather Works, Bombay, would squarely apply. No eviction
was possible under Section 13(1)(e) of the Act because it
must be an unlawful subletting. Therefore, there is total
protection both under 1959 Act and 1973 Act.
8. There is no warrant to hold that first defendant has
unlawfully sublet. In any event, if defendants 2 and 3 are
sub-tenants in accordance with Section 14 of the Act, unless
special sub-tenancy is determined, no eviction is possible.
9. Mr S.K. Dholakia, learned counsel for the respondents
24, 26 and 27 supporting this argument submits that there is
privity of contract between the original lessor and the
occupant. The predecessor of the original lessor had
authorised defendant 1 to build the superstructure.
Defendant 1 had absolute right to transfer his interest and
having transferred his right of construction to defendants 2
and 3, the construction was made by defendants 2 and 3
1 (1985) 1 SCC 414: (1985) 2 SCR 563
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lawfully and binding on the original lessee as he had not
made any contract to the contrary. The occupants were
inducted lawfully as tenants of the superstructure before
1959 or 1973 and therefore are eligible to the protection
available under Sections 14 and 15 of the Act. Even on
equity, they are entitled to a decision in their favour. It
has been noted by the High Court that some of the occupants
are tailors, laundrymen etc. and their livelihood is
dependant on these premises. The eviction will entail
severe hardship.
10. Mr V.A. Bobde, learned counsel for the respondents
submits, no doubt under the original lease dated July 7,
1948, a permission had been given to Gore to construct but
he never constructed. He created a sub-lease in favour of
defendants 2 and 3. It was the sub-lessees who had put up
this building. In relation to the demised property there
was no privity of contract between the original lessor and
the contesting defendants. Defendants 2 and 3 constructed
14 shops and assigned their rights in favour of defendants
6, 7 and 8. How can these occupants claim the right as sub-
tenancy? Jai Singh Morarji v. Sovani P. Ltd.2 clearly lays
down that no further sub-lease is possible. That would
squarely apply to the facts of the present case. The
reliance placed on Tota Singh case’ is not correct. In any
event, Section 14 does not take within it assignments and
transfers.
11. The short question that arises for our consideration in
this case is, whether the occupants, the present appellants
who are the assignees from defendants 2 and 3 can claim the
protection of the Act as sub-lessees.
12. The original lease deed dated July 7, 1948 between
Awate and Gore states in clause 2 sub-clauses (1) and (3) as
follows :
“2. (1) I have taken the said land on rent for
the period of 25 years from the date July 7,
1948 and have taken the same in my possession
this day.
2. (3) The land is vacant and I shall
construct buildings therein as per my wishes
and I shall give the said building or any
portion thereof to any person on lease rent
and I shall take the income derived
therefrom.”
13. Admittedly Gore did not put up any construction.
However, reliance is placed on clause 2 sub-clause (3)
extracted above to urge that he had a right of sub-lease
because he could build and let it out in favour of any one
he liked. In our considered opinion the permission to
construct means nothing more than an emphasis of the manner
of enjoyment of the property. Even then as stated above,
Gore never constructed. He leased out the property in
favour of defendants 2 and 3 by lease deed dated February
17, 1949. Under clause 2 sub-clause (D), it is stated as
follows:
“The said land is vacant. We shall construct
structures thereon as per our wishes and we
shall give the said building or any portion
thereof on sub-lease to any person and we
shall take the income derived therefrom.
2 (1973) 1 SCC 197 (1973) 2 SCR 603
89
We shall obtain the permission required for
the said construction. In case your signature
or consent is required in that matter, you are
to give the same.”
14. These sub-lessees (defendants 2 and 3) assigned their
rights in favour of defendants 16, 7 and 8 and others who
are the appellants. How can they claim protection as sub-
lessees? The important point to note here is that the
original lessor (sic lessee) Gore, defendants 2 and 3 sub-
lessees are no longer before us. They have not filed the
appeal. In these circumstances, the principle applicable to
this case is as stated in Jai Singh Morarji case2 that a
sub-tenant cannot create further sub-tenancy. Therefore, we
are totally unable to see any scope for application of
Section 15 of the Act. The parties are afforded liberty to
contract out of the section. Even then it is only a sub-
tenant who could claim protection. If in law, they are not
sub-tenants of the original lessor, this-section is totally
inapplicable.
15. Again for the application of Section 14, there must be
a lawful subtenancy. That is not so here. The occupants
were not lawfully inducted into possession as sub-tenants
either prior to 1959 or 1973. Therefore, we are unable to
accept the contention urged by Mr U.R. Lalit and Mr S.K.
Dholakia, learned counsel. Hence, that section is also
inapplicable.
16. Weighing the equitable considerations, the civil appeal
was adjourned for effecting a compromise. But the parties
have not done so. Therefore, we are unable to grant any
relief on that score. The civil appeal will stand
dismissed. However, there shall be no order as to costs.