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the Tamilnadu Buildings (Lease and Rent Control) Act, (hereinafter referred to as the ‘Act’) =In the result, the Civil Revision petition is allowed and the impugned orders are set aside and RCOP.No.37 of 1986, is allowed and eviction is ordered on the ground of subletting. The respondents shall vacate and hand over vacant possession of the petition premises to the petitioners/landlords within a period of two months from the date of receipt of a copy of this order. No costs. =(i) In order to prove mischief of subletting as a ground for eviction under rent control laws, two ingredients have to be established, (one) parting with possession of tenancy or part of it by tenant in favour of a third party with exclusive right of possession and (two) that such parting with possession has been done without the consent of the landlord and in lieu of compensation or rent. (ii) Inducting a partner or partners in the business or profession by a tenant by itself does not amount to subletting. However, if the purpose of such partnership is ostensible and a deed of partnership is drawn to conceal the real transaction of sub-letting, the court may tear the veil of partnership to find out the real nature of transaction entered into by the tenant. (iii) The existence of deed of partnership between tenant and alleged sub-tenant or ostensible transaction in any other form would not preclude the landlord from bringing on record material and circumstances, by adducing evidence or by means of cross-examination, making out a case of sub-letting or parting with possession in tenancy premises by the tenant in favour of a third person. (iv) If tenant is actively associated with the partnership business and retains the control over the tenancy premises with him, may be along with partners, the tenant may not be said to have parted with possession. (v) Initial burden of proving subletting is on landlord but once he is able to establish that a third party is in exclusive possession of the premises and that tenant has no legal possession of the tenanted premises, the onus shifts to tenant to prove the nature of occupation of such third party and that he (tenant) continues to hold legal possession in tenancy premises. (vi) In other words, initial burden lying on landlord would stand discharged by adducing prima facie proof of the fact that a party other than tenant was in exclusive possession of the premises. A presumption of sub-letting may then be raised and would amount to proof unless rebutted.

IN THE H IGH COURT OF JUDICATURE AT MADRAS

A bridge under construction in Nagapattinam

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DATED:07.02.2012
CORAM
THE HONOURABLE Mr. JUSTICE T.S.SIVAGNANAM
CRP (NPD) No.1317 of 1995
1.M.S.Hohammed Jahabar Kadiri (Deceased)
2.Ummal Bajira
3.M.J.K.Haja Shaik Alloudeen
4.Mumtaz Begam … Petitioners
P2 to P4 as legal heirs of the deceased 1st petitioner
vide order of this Court, dated 24.12.2003 made in CMP.14127/2003
Vs.

1.G.Govindaraju
2.Pangajam Ammal
3.R.Prabakaran
4.Ramadoss (Died)
5.R.Neelavathi
6.Vinayakamurthy
7.Senthamarai
8.Mala
9.Kavitha … Respondents
R5 to R9 as legal heirs of the deceased fourth respondent
vide order of this Court, dated 05.11.2011, made in CMP.886/2010.

Prayer: Civil Revision Petition filed against the order and decreetal order dated 18.10.1994, made in RCA.NO.12 of 1990, on the file of Rent Control Appellate Tribunal (Sub Court), Nagapattinam, confirming the judgment and decree dated 24.10.1989, made in RCOP.No.37 of 1986, on the file of Rent Controller (District Munsif), Tiruvarur.

For Petitioners : Mr.K.Chandrasekaran
For Respondents : Mr.P.Gopalan for RR3,5&6
RR7-9 Given up
O R D E R

This revision petition filed, under Section 25 of the Tamilnadu Buildings (Lease and Rent Control) Act, (hereinafter referred to as the ‘Act’) is directed against the order dated 18.10.1994, made in RCA.No.12 of 1990, on the file of the of Rent Control Appellate Tribunal (Sub Court), Nagapattinam, confirming the judgment and decree dated 24.10.1989 in RCOP NO.37 of 1986 on the file of Rent Controller (District Munsif), Tiruvarur.

2. The Revision petitioner (since deceased) is the landlord and the respondents herein were the respondents in the eviction petition. The landlord filed RCOP No.37 of 1986, for eviction of the respondents from the petition premises on the ground of subletting and for his own use and occupation. It is stated that during 1960, the property was leased out to Manickam Chettiyar and Sundresa Mudaliyar for running coffee power business on a monthly rent of Rs.60/-. The terms and conditions of the lease were reduced into writing by two registered lease deeds dated 18.07.1960 and 06.01.1966. Subsequently, two other unregistered lease agreements were executed on 01.07.1970 and 01.06.1978. Initially the lease was in respect of Door No.64, and after 01.06.1978, the adjacent door No.64/1 was also given on lease. The landlord further stated that after the demise of the registered leases though no lease agreements were entered into between the respondents 1 and 2 as they were the legal heirs of the said Manickam Chettiyar and Sundresh Mudaliyar and being partners of the coffee power business, they were in occupation of the petition premises, (the first respondent is the son in law of Mainckam Chettiyar and the second respondent is the wife of Sundresa Mudaliyar). The landlord further stated that there was no right conferred on the tenants to sublet the property, however the respondents 1 and 2 stopped carrying on business and sublet the premises to the third respondent, who is running the business along with the fourth respondent, his father. Therefore, the landlord contended that the respondents are liable to be evicted on the ground of subletting. The landlord further sought for eviction on the ground of requirement of the premises for his own use and occupation, by stating that the shop in which he was running a provision store, had been given to son-in-law and therefore, he is desirous of staring a new business in the petition premises as he does not own any other shop.

3. The first respondent filed a counter statement denying the allegation of subletting. It was stated that the fourth respondent alone was running the business even during the life time of Manickam Chettiyar and Sundresa Mudaliyar and he was running the same in the capacity as partner, though the business was in the name of Manickam Chettiyar and Sundresa Mudaliyar. Since the lease agreement could be entered into only in the name of the partners, it was entered into in the names of Manickam Chettiyar and Sundresa Mudaliyar, however they were not involved in the business. After the demise of the partners of Bharath Coffee Works, the respondents 1 and 2 became partners and subsequently, retired from the partnership business after receiving consideration from the fourth respondent and thereafter, the respondents 3 and 4 along with their family members, are running the business as partners. That on and after 01.10.1984, the respondents 1 and 2 are no manner involved with the business and since the fourth respondent was running the business, there is no subletting. The plea of the landlord that he requires petition premises was denied as lacking in bonafides. The fourth respondent filed separate counter statement virtually reiterating the stand of the first respondent.

4. Before the learned Rent Controller, the landlord examined himself as PW-1 and three other witness were examined as PW-2 to 4 and thirty documents were exhibited as Exhibits A1 to A30. The respondents 1 and 4 were examined as RW-1 &2 and one Packrisamy was examined as RW-3 and nine documents were marked as Exhibits R1 to R9. The learned Rent Controller framed three questions for consideration, whether, the landlord requires the premises for own use and occupation, whether the respondents 3 &4 are sub-tenants and whether the eviction petition is liable to be dismissed for non-joinder of necessary party. The learned Rent Controller decided all the three questions against the landlord and dismissed the eviction petition.

5. The landlord preferred an appeal in RCA.No.12 of 1990, and the learned Appellate Authority concurred with the findings of the learned Rent Controller and the appeal was dismissed. Aggrieved by the same, the present revision has been filed by the landlord.

6. It is seen that during the pendency of the revision petition, the landlord died and his legal representatives have been brought on record. Likewise the fourth respondent died and his legal representatives have been brought on record. Since the landlord claimed that he requires the petition premises for his own business, the landlord having died pending this revision petition, there would not be any necessity to decide the said issue. Therefore, the only question to be decided in this revision is whether, the respondents 3 & 4 are sub-tenants. Before deciding this issue, it has to be seen as to under what circumstances this Court would be justified in interfering with the concurrent findings of the Courts below in exercise of the powers conferred under Section 25 of the Act.

7. I have elaborately heard Mr.K.Chandrasekaran, learned counsel for the petitioner and Mr.P.Gopalan learned counsel for respondents and carefully perused the materials available on record.

8. The power conferred under Section 25 of the Act, is undoubtedly wider that the power provided in Section 115 of the Civil Procedure Code. This Court while exercising its revisional jurisdiction under Section 25 of the Act, has to satisfy itself as to the correctness, propriety and legality of any decision. When the Courts failed to appreciate the oral and documentary evidence in its entirety and when it rendered a finding not warranted on the materials available, such orders though may be concurrent are liable to be interfered with. The Hon’ble Supreme Court has held that the revisional power is not be exercised to upset concurrent findings of fact merely on the ground that different view is possible. However, when the findings are perverse even such concurrent findings are not immune from challenge. The learned counsel for the petitioner placed reliance on the decision of this Hon’ble Full Bench of this Court in A.Aishath Najiya vs. Messrs. Lalchand Kewalram & Ors, 1989 2 L.W. 123, wherein the Hon’ble Full Bench held as follows:-
27. In this case, I make it very clear that I am not reappraising the evidence on record. I am only pointing out as to how both the Rent Controller and the Appellate Authority in disregard of the statutory provisions, proceeded to assess the evidence from angles which are not warranted by the statute, from perspectives which are not contemplated under the statute. In such a case, certainly the revisional power could be exercised where the approach itself is totally wrong. Hence this decision cannot help the respondents.

9. Further, this Court in P.K.Vijayan and Ors. vs. M/s.Kalaimagal Account Book Shop, (2000) 2 MLJ 495, and P.K.M.S. Jailani Beevi vs. J.Mohan Lal, 2001 (2) CTC 22, laid down the circumstances in which this Court would be justified in interfering with concurrent findings recorded by the Rent Controller and the Appellate Authority. At this stage, it would be beneficial to quote the relevant paragraphs of the judgment in the case of Jailani Beevi:-
25. The learned counsel for the petitioner/respondent cited a number of decisions of the Supreme Court and this Court for the position that interference under Section 25 of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960, is clearly circumscribed. The decisions relied on by the petitioner/respondent are listed below:
1. Phiroze Bamanji Desai v. Chandrakant, AIR 19743SCR267 ; 2. Mattulal v. Radhe Lal, AIR 1974 SC 1596; 3.Children’s Choice v, Adiseshiah, 1982 (1) MLJ 411; 4.Hameedia Hardware Stores v. Mohan Lal Sowcar, AIR 1988 SC 1060 ; 5. Gajendra Sha v. Govindarajan, 1996 (1) CTC 492 ; 6. Hotel De-Broadway, Etc. v. M/s Snow White Industrial Corporation, 1997 (1) CTC 193; 7. Mohammed @ Bawa Sahib v. Vimalckand, 1998 (II) MLJ 619; 8. The South India Corporation Agencies Ltd. v. Chandrakanth C. Bandani, 1998 (1) CTC 674; 9. Jothi Ammal v. Kulandai Vadivel, 1999 (II) MU 35; 10. Munawar Jan Begum v. Subramaniam, 2000 (1) MLJ 19.
Dealing with the revisionary powers under the Bombay Rents, Hotel and Lodging House Rates control Act (57 of 1947). the Supreme Court in Phiroze Bamanji Desai v. CM. Patel, AIR 1974 SC 1059 has held that the High Court cannot reassess the value of the evidence and interfere with the finding of fact merely because it thinks that the appreciation of the evidence by the lower court is wrong and the court should have reached a different conclusion of fact from what it did. Only if the lower Court had applied a wrong test on a misconstruction of the word ‘requires’ the finding recorded by it would have been vitiated by an error of law.
In Mattulal v. Rade Lal, AIR 1974 SC 1596, the Supreme Court held that the finding reached by the First Appellate Court on an appreciation of evidence that the landlord does not bona fide require the premises in question for the purpose of starting business as a dealer in iron and steel materials is a finding of fact and not a finding of mixed law and fact and it cannot be interfered with by the High court in second appeal unless it is shown that in reaching it a mistake of law is committed by the Appellate Authority or it ia based on no evidence or is such as no reasonable man can reach,
In Children’s Choice v. Adiseshana, 1982 (1) MLJ 411, T.N.Singaravelu, J. has pointed that if the bona fides of the landlords had been proved, the relative hardship of the parties in the event of eviction should also be considered before ordering eviction under Section 10(3)(c) of the Act.
It has been held in Hammedia Hardware Stores v. Mohan Lal Sowcar, AIR 1988 SC 1060 that the landlord should establish that he bona fide requires premises, in addition to proving other ingredients referred to in Sec. 10(3)(a)(iii) for getting an order of eviction.
In Gajendra Sha v. Govindarajan, 1996, (1) CTC 492, Abdul Wahab, J. (as the learned Judge then was) considered the requirement of the petition building by the landlord for the purpose of carrying on his own business under Section 10(3)(a)(iii), the tenant disputing the claim of the landlord as lacking in bona fides. Factually it was found that it was highly impossible to apprehend that such a flourishing business would be shifted to a narrow lane, especially when there was no threat of eviction and the accommodation was much more than what the landlord was going to get in the petition building. The learned Judge found that the petition was lacking in bona fides.
In Hotel De-Broadway Etc. v. M/s. Snow White Industrial Corporation, Etc, 1997 (1) CTC 193: 1997 (1) LW 421 it has been held by K.Govindarajan, J. that mere inconvenience of tenant cannot deprive, landlord of his bona fide right to have additional accommodation. The concurrent findings about bona fides of landlord cannot be disturbed merely on the plea of the tenant as to difficulty of finding alternative accommodation in the area and it is not a relevant ground for rejecting the claim of the landlord. The mere fact that the tenant cannot get alternative accommodation alone cannot be the basis to reject landlord’s claim. It is not the object of S. 10(3)(c) to weigh the hardship to tenant as against advantage of landlord on the delicate scales of giving benefit of a slight tilt in favour of the tenant.
In Mohammed @ Bawa Sahib v. Vimalchand, 1998 (II) MLJ 619 the same learned Judge has held that eviction petition by the landlord as kartha of joint family seeking premises for his brother’s requirement is not maintainable under Section 10(3)(a)(iii). It was also held that the requirement was not bona fide.
In The South India Corporation Agencies v. Chandrakanth C.Badani, 1998 (1) CTC 674, the same learned Judge has held that unless there is perversity in the matter of appreciation of evidence by authorities revisional court will not interfere with concurrent findings.
In Jothi Ammal v. Kulandai Vadivel, 1999 (II) MLJ 35 the learned Judge has considered the scope of applicability of Sec. 10(3)(c).
In Munawar Jan Begum v. Subramaniam, 2000 (1) MLJ 19 has held that unless perversity is writ large on the face of the judgments rendered by the lower authorities, it is not desirable for the revisional court to interfere with the concurrent findings of the lower authorities.

10. Thus, the legal principle which could be culled out from the aforementioned decision are that if the findings of the authorities below though concurrent, if had been rendered without looking into the evidence, such decision can never be said as in accordance with law and this Court is fully justified in interfering with the concurrent findings.

11. The learned counsel for the petitioner strenuously contended that the authorities below concurrently erred in disregarding the evidence and failed to apply the law relating to subletting, which have been crystallized in various decisions of the Hon’ble Supreme Court and this Court. After having gone through the pleadings and the evidence, more particularly, the evidence of PW-1 (landlord) and RW-1 (first respondent) and RW-2 (fourth respondent), the controversy to be decided lies in a very narrow campus. It is not in dispute that the lease agreement both the registered and unregistered documents stood in the name of Manickam Chettiyar and Sundresa Mudaliyar. It is also not in dispute that the first respondent is the son-in-law of Manickam Chettiyar and the second respondent is the wife of Sundresa Mudaliyar. After the demise of the tenants (Manickam Chettiyar and Sundresa Mudaliyar) respondents 1 & 2, continued in the capacity of legal heirs of the original tenants. During that period, there appears to have been a dispute as regards the quantum of rent and RCOP No.4 of 1980, was filed by Bharath Coffee Works, represented by its Managing Partner, S.Govindaraju, (1st respondent) under Section 8(5) of the Act, to deposit the rent into Court.

12. Admittedly, no lease agreement was entered into respondents 1 and 2. Likewise, there is no material to show that the respondents 1 and 2 organised themselves into a registered partnership and such registration, which was done during 1975 under Exhibit R7 was with the knowledge of the landlord. In other words, there is no evidence to show that the landlord was aware that the respondents 1 and 2 constituted themselves into a partnership, which was registered on 13.08.1975. From the cross examination of PW-1, it appears that the landlord was aware that the fourth respondent was assisting the tenants (Manickam Chettiyar and Sundresa Mudaliyar) in running the Coffee works business and another by-cycle business.

13. The crucial question which has to be seen here is whether the respondents 3 and 4 became sub-tenants to respondents 1 and 2, there would not have been any difficulty if the respondents 1 and 2 continued the business and the fourth respondent was assisting them in the business. However, from the evidence of RW-1, it is clear that on and after 01.10.1984, the respondents 1 and 2 retired from the partnership business after receiving consideration from the fourth respondent and the firms stood re-constituted by making the respondents 3 and 4 along with their family members as partners of the business. Admittedly, such re-constitution was without the knowledge and consent of the landlord. Therefore, the question is whether this would amount to subletting. The Hon’ble Supreme Court in Ms.Celina Coelho Pereira & Ors vs. Ulhas Mahabaleshwar Kholkar & Ors, (2010) 2 L.W. 414, was considering a Rent control proceedings, where eviction was sought for on the ground of subletting. The Hon’ble Supreme Court after analyzing elaborately the case laws on the said point, summarized the legal position on the following lines:-
28. The legal position that emerges from the aforesaid decisions can be summarised thus:
(i) In order to prove mischief of subletting as a ground for eviction under rent control laws, two ingredients have to be established, (one) parting with possession of tenancy or part of it by tenant in favour of a third party with exclusive right of possession and (two) that such parting with possession has been done without the consent of the landlord and in lieu of compensation or rent.
(ii) Inducting a partner or partners in the business or profession by a tenant by itself does not amount to subletting. However, if the purpose of such partnership is ostensible and a deed of partnership is drawn to conceal the real transaction of sub-letting, the court may tear the veil of partnership to find out the real nature of transaction entered into by the tenant.
(iii) The existence of deed of partnership between tenant and alleged sub-tenant or ostensible transaction in any other form would not preclude the landlord from bringing on record material and circumstances, by adducing evidence or by means of cross-examination, making out a case of sub-letting or parting with possession in tenancy premises by the tenant in favour of a third person.
(iv) If tenant is actively associated with the partnership business and retains the control over the tenancy premises with him, may be along with partners, the tenant may not be said to have parted with possession.
(v) Initial burden of proving subletting is on landlord but once he is able to establish that a third party is in exclusive possession of the premises and that tenant has no legal possession of the tenanted premises, the onus shifts to tenant to prove the nature of occupation of such third party and that he (tenant) continues to hold legal possession in tenancy premises.
(vi) In other words, initial burden lying on landlord would stand discharged by adducing prima facie proof of the fact that a party other than tenant was in exclusive possession of the premises. A presumption of sub-letting may then be raised and would amount to proof unless rebutted.

14. The Hon’ble Supreme Court after analyzing the facts of the said case, discussed the effect of constituting partnership by a tenant and held as follows:-
30. If the purpose of constituting partnership by the tenant is ostensible and a deed of partnership is drawn to conceal the real transaction of subletting in a given case, the court may be required to tear the veil of partnership to find out the real nature of transaction entered into by the tenant and in such circumstances the evidence let in by the landlord cannot be ignored on the ground that there is some variance between pleading and proof. In a case such as the present one, the rule of secundum allegata et probata is not strictly applicable as the tenant cannot be said to have been put to any prejudice.

15. Thus, the Court is entitled to tear the veil of partnership to find out the real nature of transaction. The case of the RW-1 and RW-4 is that after the demise of Manickam Chettiyar and Sundresa Mudaliyar, the respondents 1 and 2, continued the business in the capacity of the legal heirs of the said persons, who were the tenants. The business was not a registered partnership firm. For the first time, the respondents 1 and 2 constituted themselves into a registered partnership firm on 13.08.1975, Exhibit R-7. This constitution of partnership business was without notice to the landlord. This came to light when the first respondent filed RCOP.No.4 of 1980, under Section 8(5) of the Act, wherein the firm was the petitioner, represented by the first respondent, Managing Partner. There is no record placed before the Courts below that the fourth respondent was in fact a partner initially with Manickam Chettiyar and Sundresa Mudaliyar and after their demise, along with respondents 1 and 2.

16. As admitted by RW-1, the registered firm was re-constituted on 01.10.1984, and the respondents 1 and 2 retired from the partnership business for consideration and respondents 3 and 4 became partners and the firm stood re-constituted with the respondents 3 & 4 and their family members as partners. Thus the reconstitution of the partnership is undoubtedly a transaction made to conceal subletting. Therefore, the contention raised by the learned counsel for the respondents that the respondents 3 and 4 have nothing to do with the landlord, deserved to be rejected. The decision of the Hon’ble Division Bench of this Court, Devarajulu Naidu vs. Ethirajavalli Thayaramma, (1949) 2 MLJ 423, relied on by the learned counsel for the respondents, has absolutely no application to the facts of the present case, since the tenancy in the said case was with partners of the firm and after winding up, one partner was allowed to use the business premises and therefore, the Hon’ble Division Bench held that it is not a case of subletting or transfer. The facts of the present case is entirely different in the said judgment is of no assistance to the respondents. At this stage, it would be beneficial to refer certain decisions of this Court, wherein this Court analyzed various aspects on the ground of subletting, S.Jainmul Jain & another vs. A.R.Nagaraja & another, 1997-2-L.W 386; V.T.Asokan & another vs. Bowjiya Begam, 1998-3-L.W. 661 and A.R.V. Venkatasamy Naicker and sons vs. V.S.Krishnamoorthy, 2005 (4) CTC 583.

17. For all the above reasons, it has to be held that the Courts below misread the evidence and over looked the law declared by the Courts on the ground of subletting and what are the tests to decide a case of subletting and therefore, this Court is convinced that the findings rendered by the Courts below being perverse and legally unsustainable, deserves to be interfered with.

18. In the result, the Civil Revision petition is allowed and the impugned orders are set aside and RCOP.No.37 of 1986, is allowed and eviction is ordered on the ground of subletting. The respondents shall vacate and hand over vacant possession of the petition premises to the petitioners/landlords within a period of two months from the date of receipt of a copy of this order. No costs.
07.02.2012
Index :Yes/No
Internet:Yes/No
pbn

T.S.SIVAGNANAM, J.
pbn
To
1)The Rent Control Appellate Tribunal (Sub Court), Nagapattinam.
2)The Rent Controller (District Munsif), Tiruvarur.
Pre-Delivery Order in
CRP (NPD) No.1317 of 1995

07.02.2012

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