NANDKISHOR SAVALARAM MALU (DEAD) THROUGH LRS. Vs. HANUMANMAL G.BIYANI(D) BY LRS.& ORS.
Supreme Court of India (Division Bench (DB)- Two Judge)
Appeal (Civil), 11868 of 2016, Judgment Date: Nov 29, 2016
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL No.11868 OF 2016
(ARISING OUT OF SLP (C) No. 19259 of 2010)
Nandkishor Savalaram Malu (Dead)
Through Lrs.
…….Appellant(s)
VERSUS
Hanumanmal G. Biyani (D)
Thr. Lrs. & Ors. ……Respondent(s)
J U D G M E N T
Abhay Manohar Sapre, J.
1) Leave granted.
2) This appeal is filed against the final judgment and order dated
23.03.2010 passed by the High Court of Judicature at Bombay in Civil
Revision Application No.493/2008 allowing the said revision application
filed by the respondents herein.
3) Facts of the case lie in a narrow compass so are the issues involved
in the appeal, a short one. It would, however, be clear from the facts
mentioned infra.
4) The appellants are the plaintiffs (landlords) whereas the respondents
are the defendants (tenant).
5) One Mr. Sawalaram Shriram Malu and Mr. Nandkishore Sawalaram Malu
(father and son respectively) jointly owned House No.47/48 situated in
Madhavnagar at Sangli (MH) (hereinafter called "the suit house"). They let
out the suit house to a firm called "M/s Biyani Textile" (hereinafter
referred to as "the Firm”) on a monthly rent of Rs.260/-.
6) On 09.03.1982, the landlords served a quit notice on the tenant-Firm
and determined the tenancy by demanding arrears of rent for the period
01.06.1980 to 28.02.1982 and possession of the suit house. Since the Firm
did not pay the arrears as demanded and nor vacated the suit house, the
landlords were constrained to file a civil suit being Regular Civil Suit
No. 317 of 1982 claiming decree for arrears of rent and eviction under the
provisions of the Bombay Rent Control Act. The suit was filed against one
employee of the Firm-defendant no.1 and partners of the Firm-defendant
nos.2 to 9 in the Court of IInd Civil Judge, Jr. Division, Sangli.
7) Defendant no.1 filed his written statement whereas defendant nos. 3, 4
to 9 filed their written statement jointly. So far as defendant no.1 is
concerned, he set up his case contending that he was working as employee of
the Firm. He further contended that in 1980, there was some discussion
between the plaintiffs and the partners of the Firm about vacating of the
suit house and pursuant thereto, the Firm vacated the suit house. The suit
house was then let out to defendant no.1 by the plaintiffs. It was then
contended that plaintiff no.1 died and his legal representatives not having
been brought on record, the suit could not be continued at the instance of
plaintiff no. 2 for want of any privity of contract between defendant no.1
and the plaintiff no.2.
8) So far as the partners of the Firm, i.e., defendant nos. 3, 4 to 9,
are concerned, they contended that they having vacated the suit house in
May 1980 and cleared all their arrears of rent, they are no more liable
to do anything in the case and, therefore, suit against them is liable to
be dismissed.
9) The Trial Court, vide judgment dated 14.10.1991, dismissed the suit
against defendant no.1 whereas it was decreed against defendant nos. 2 to
9. Firstly, it was held that the suit house was let out to the Firm
through their partners (defendant nos.2 & 3) and, therefore, the Firm was
the tenant. Secondly, the Firm had committed defaults in payment of
arrears of rent and also failed to re-pay when demanded by the plaintiff.
Thirdly, defendant no.1 was an employee of the Firm. Fourthly, defendant
no. 1 was not the tenant of the plaintiff as claimed by him and was in
unauthorized occupation of the suit house as a trespasser. Fifthly, the
Firm and its partners (defendant Nos.2 to 9) having failed to pay the
arrears of rent, are liable to be evicted from the suit house under the
Bombay Rent Control Act. Sixthly, the suit did not abate on the death of
plaintiff no.1 because plaintiff no.2 is already on record and sufficiently
represent the estate of the deceased, plaintiff no.1. Seventhly, liberty
was granted to the plaintiff to file separate suit against defendant no.1
under the general law to claim possession of suit house because he was
found to be in possession of the suit house as trespasser and no eviction
decree can be passed against a trespasser under the Rent laws.
10) Felt aggrieved, Plaintiff no.2 filed first appeal being R.S.A. No.
577 of 1991 before the District Judge, Sangli. By order dated 03.02.2006,
the District Judge allowed the appeal and decreed the suit against all the
defendants as claimed by the plaintiffs. It was held that defendant no.1
being an employee of the Firm was bound by the decree passed against the
Firm and its partners (defendant Nos.2 to 9). It was further held that the
defendants failed to prove that the Firm or/and its partners surrendered
the possession of the suit house to the plaintiffs on 12.05.1980 and
vacated the suit house. It was further held that defendant no.1 failed to
prove that he became plaintiff's tenant in his individual capacity by
entering into a fresh contract of tenancy on vacating the suit house by the
original tenant as claimed by them and lastly, the defendants are liable to
pay the mesne profits at the rate of Rs.260/- per month from 01.05.1980
till delivery of possession of the suit house to the plaintiff.
11) Felt aggrieved, the defendants filed revision application being
C.R.A. No. 493 of 2008 before the High Court. While the revision
application was pending, defendant no.1 died and hence his legal
representatives were brought on record. The High Court, by impugned order,
though did not disturb the factual finding of the first appellate Court yet
allowed the revision and while setting aside the order of the appellate
Court, restored the order of the Trial Court. It is against this order,
plaintiff no. 2 (landlord) felt aggrieved and filed this appeal by way of
special leave before this Court. During the pendency of this appeal, he
also died and hence his legal representatives were brought on record to
continue the lis.
12) Heard Mr. R.S. Hegde, learned counsel for the appellants and Mr.
Sukhbir Singh, learned counsel for the respondents.
13) Learned counsel for the appellants (plaintiff) while assailing the
legality and correctness of the impugned order argued three points.
14) In the first place, he argued that the High Court was not right in
allowing the revision. Learned Counsel urged that the High Court failed to
even take note of the settled legal principles applicable to the
controversy at hand and thus committed jurisdictional error.
15) In the second place, learned counsel argued that without disturbing
any of the factual findings of the first appellate Court, which were
otherwise binding on the High Court in its revisionary jurisdiction, the
High Court committed jurisdictional error in holding that once it is held
in rent proceedings that defendant no.1 was a trespasser then no decree
under the Rent laws could be passed against a trespasser for his eviction
from the suit house and the remedy of the plaintiffs in such circumstances
is to file regular civil suit under the general law for obtaining
possession.
16) In the third place, learned counsel argued that the High Court failed
to see that a decree for eviction was rightly passed against the Firm and
its partners holding them as tenant and this decree, according to him, was
binding on defendant no.1 on all force for the simple reason that firstly,
defendant no.1 even according to his own case was an employee of the Firm
and the Courts also held him to be so. Secondly, defendant no.1 failed to
establish his independent contract of tenancy with the plaintiffs though
claimed. Thirdly, the Firm through their partners failed to prove that they
surrendered the vacant possession of the suit house to the plaintiffs on
12.05.1980.
17) According to learned counsel, it was, therefore, a clear case where
tenant having suffered a decree for eviction, all persons claiming through
such tenant or/and those acting for and on behalf of the tenant-Firm, had
to be dispossessed on the strength of the decree suffered by the tenant-
firm.
18) On these submissions, learned Counsel for the appellants prayed for
reversal of the impugned order and restoration of the order of the first
appellate Court.
19) In reply, learned counsel for the respondents supported the impugned
order and contended for its upholding.
20) Having heard the learned counsel for the parties and on perusal of
the record of the case, we are inclined to accept the submissions of the
learned counsel for the appellants as, in our opinion, it has a force.
21) Indeed, we are constrained to observe that there was absolutely no
legal basis for the High Court to have reversed the well-reasoned order of
the first appellate Court which had rightly reversed the order of the Trial
Court by passing decree for arrears of rent, eviction and mesne profits
against all the defendants jointly and severally. The High Court,
unfortunately, failed to apply the settled legal principles applicable to
the case at hand as are enumerated herein below in the light of following
factual findings of fact recorded by the two Courts below.
22) Firstly, the Firm was held to be the tenant whereas defendant no.1
was held to be Firm's employee. Secondly, the Firm failed to prove that
they surrendered their possession to the appellants and cleared all arrears
of rent and lastly, defendant no.1 was held to be in possession of the suit
house as “trespasser” and not as “ appellants’ tenant”.
23) With these concurrent findings of fact, we are of the considered
opinion that neither the Firm nor their partners and nor defendant no.1 had
any legal right to remain in possession of the suit house. The reason
being that so far as the Firm and its partners were concerned (defendant
Nos. 2 to 9), they being the tenant rightly suffered the decree for payment
of arrears of rent and eviction under the Rent Act and so far as defendant
no.1 was concerned, he was neither an owner of the suit house nor a tenant
inducted by the appellants and nor a licensee but was held to be an
employee of the Firm and a rank trespasser in the suit house.
24) The legal effect of such eviction decree under the Rent Act was that
the possession of the tenant-firm and persons claiming through such tenant
became unauthorized. Since the tenant was a Firm, persons connected with
the internal affairs of the Firm such as its partners and the employees
working in the Firm were also bound by the eviction decree for the simple
reason that all such persons were claiming through the tenant-Firm.
25) An employee of a tenant is never considered to be in actual
possession of tenanted premises much less in possession in his legal right.
Indeed, he is allowed to use the tenanted premises only with the permission
of his employer by virtue of his contract of employment with his employer.
An employee, therefore, cannot claim any legal right of his own to occupy
or to remain in possession of the tenanted premises while in employment of
his employer or even thereafter qua landlord for want of any privity of
contract between him and the landlord in respect of the tenanted premises.
26) There was, therefore, no need for the appellant to file a separate
suit to claim possession of the suit house against defendant no.1 under the
general law as he was well within his legal right to execute the decree for
eviction from the demised premises in this very litigation not only against
the original tenant but also against all the persons who were claiming
through such tenant. As mentioned above, defendant no.1 was such person who
was held to be claiming through the tenant being its employee and was,
therefore, bound by the decree once passed against his employer-tenant.
27) A tenancy is a creation of contract between the two persons who are
capable to enter into contract called lessor/landlord and the
lessee/tenant. The two persons can be either living person or juristic
persons such as Partnership Firm or a Company.
28) Once the tenancy is created either orally or in writing with respect
to a land or building then it is always subject to the relevant provisions
of the Transfer of Property Act, 1882 (hereinafter referred to as “the TP
Act”) and the State Rent Acts. Sections 105 to 111 of the TP Act provide
certain safeguards, create some statutory rights, obligations, duties
whereas the State Rent Acts, inter alia, specify the grounds to enable the
lessor to evict the lessee/tenant from the demised premises.
29) If the lessee/tenant is a living person, then in such event, the
tenant would also include his legal representatives in the event of his
death together with his dependents living with the tenant in the tenanted
premises. Likewise, if the lessee/tenant is a juristic person, i.e.,
partnership Firm then such tenant would represent the interest of all the
partners of the Firm and the employees working in the Firm. Such persons
since claim through the Firm, they have no right of their own in the
tenancy and in the demised property qua landlord.
30) As a matter of fact, in our view, it was not necessary for the
appellants to have impleaded defendant no.1 in the present rent
proceedings. The reason being that in rent proceedings the lessee/tenant
is the only necessary or/and proper party and none else. A person, who
claims through lessee/tenant, is not a necessary party.
31) The aforementioned factors were completely overlooked by the High
Court. It is for these reasons, the impugned order is not legally
sustainable and, therefore, deserves to be set aside.
32) In the light of foregoing discussion, the appeal succeeds and is
accordingly allowed with cost quantified at Rs.5000/- payable by the
respondents to the appellants. The impugned order is accordingly set aside
and, in consequence thereof, the judgment/decree passed by the first
appellate Court (District Judge, Sangli) dated 03.02.2006 in Civil Appeal
No.577 of 1991 is hereby restored.
33) The respondents are granted three months’ time to comply with the
judgment and decree of the first appellate Court by depositing the entire
money part of the decree as awarded therein and further to handover the
vacant possession of the suit house to the appellant. The respondents would
also pay to the appellants three months’ rent by way of damages in advance
and the cost awarded by this Court within one month and to submit the usual
undertaking to this Court, failing which the decree dated 03.02.2006 be
executed against the respondents forthwith on the expiry of one month.
………...................................J.
[A.K. SIKRI]
…...……..................................J.
[ABHAY MANOHAR SAPRE]
New Delhi;
November 29, 2016
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