Allahabad High Court
M/S Shanti Motor Finance Company vs Kusum Sharma on 22 March, 2018
Equivalent citations: AIRONLINE 2018 ALL 5117
Author: Surya Prakash Kesarwani
Bench: Surya Prakash Kesarwani
HIGH COURT OF JUDICATURE AT ALLAHABAD A.F.R. Court No. - 7 Case :- WRIT - A No. - 8495 of 2018 Petitioner :- M/S Shanti Motor Finance Company Respondent :- Kusum Sharma Counsel for Petitioner :- Sanjay Agrawal Counsel for Respondent :- Manish Kumar Nigam,Na Hon'ble Surya Prakash Kesarwani,J.
1. Heard Sri Sanjay Agrawal, learned counsel for the defendant-tenant/petitioner and Sri Manish Kumar Nigam, learned counsel for the plaintiff-landlady/respondent:
QUESTIONS INVOLVED:
2. Two questions involved in this writ petition are:
Firstly, whether a rent case filed without separately impleading partner of the tenant firm is liable to be dismissed for non joinder of necessary party and, Secondly, whether appellate court has committed a manifest error of law to dismiss the appeal on the finding of bonafide need of the son of the landlady whereas in the release application the landlady has set up her bonafide need for the disputed shop.
FACTS:
3. Briefly stated facts of the present case are that it is admitted to the parties that the disputed shop is owned by the respondent-landlady. It was originally owned by her husband Sri Surendra Nath Sharma, who had inducted the defendant-petitioner as tenant in the year 1986. Subsequently, Sri Surendra Nath Sharma died. The disputed shop was inherited by the plaintiff-landlady/respondent. She filed a P.A. Case No.15 of 2014 under Section 21(1)(a) for her bonafide need of the disputed shop. In the release application the description of the respondent has given as under:
"eSllZ 'kkUrh eksVj QkbusUl dEiuh] eksgYyk ubZ cLrh] ihyhHkhr&Vudiqj ckbZikl jksM] vkse eksVlZ ds lkeus] rglhy] 'kgj o ftyk ihyhHkhr }kjk lk>hnkj lqHkk"k pUnz vk;q yxHkx 58 o"kZ iq= Lo0 fuHkkm jke fuoklh edku uEcj 56 eksgYyk v'kksd dkyksuh] 'kgj o ftyk ihyhHkhrA"
4. Various evidences were led by the parties. The Prescribed Authority/Civil Judge (S.D.) Pilibhit, allowed the aforesaid P.A. Case and decreed the suit by judgment dated 8.12.2016. Aggrieved with this judgment the defendant-tenant/petitioner filed a P.A. Appeal No. 02 of 2017 (M/s. Shanti Motor Finance Company through its partner Subhash Chandra Vs. Kusum Sharma) which has been dismissed by the impugned judgment dated 16.2.2018, passed by the District Judge, Pilibhit on the ground of bonafide need of the son of the plaintiff-landlady.
5. Aggrieved with these two judgments, the defendant-tenant/petitioner has filed the present writ petition.
SUBMISSIONS:
6. Sri Sanjay Agrawal, learned counsel for the defendant-tenant/petitioner, submits as under:
(i) The release application was filed by the plaintiff-landlady without impleading partners of the firm. Therefore, the release application was liable to be dismissed on the ground of non-joinder of necessary parties.
(ii) Provisions of Order XXX C.P.C. are not applicable in view of the provisions of Section 38 of the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 (hereinafter referred to as 'the Rent Act 1972') and the law laid down by Hon'ble Surpeme Court in M/s. Chhotelal Pyarelal Vs. Shikharchand, AIR 1984 SC 1570 (paragraph 2) and the judgment of this Court in Prabhakar Mehrotra and another Vs. District Judge, Kanpur and others 1982 ARC, 426 (para 34).
(iii) The landlady has set up her own bonafide need for the disputed shop but the appellate court has not considered it at all and instead the appellate court has recorded the finding of bonafide need of the landlady for her sons which was never the case of the plaintiff-landlady. Therefore, the dismissal of appeal by the appellate court was without application of mind.
7. Sri Manish Kumar Nigam, learned counsel for the plaintiff-landlady/respondent submits as under:
(i) The word "tenant" has been defined in Section 3(a) and the word "landlady" has been defined in Section 3(j) of the Rent Act 1972. Section 4(33) of the U.P. General Clauses Act, 1904 defines the word "person" which includes any company or association or body of individuals, whether incorporated or not. Section 4 of the Indian Partnership Act, 1932, defines the words "partnership", "partner", "firm" and "firm name". It provides that ''Partnership" is the relation between persons who have agreed to share the profit of the business carried on by all or any of them acting for all. Persons who have entered into partnership with one another are called individually "partners" and collectively a "firm", and the name under which their business is carried on is called the "firm name". Rule 10(6)(a) of the Rent Rules recognises allotment of an accommodation to a firm. Section 38 of the Rent Act gives overriding effect. It provides that the Provisions of the Act shall have effect notwithstanding anything inconsistent therewith contained in the Transfer of Property Act, 1882 or in the Code of Civil Procedure, 1908.
(ii) Since the Rent Act 1972 and the Rules framed thereunder itself recognises allotment of accommodation to a firm, therefore, the institution of a case against the firm impleading it as defendant/respondent has the recognition of the Act and the Rules. Therefore, the Provisions of Order XXX C.P.C. being not in conflict with the Rent Act 1972 and the Rules framed thereunder, shall be applicable to release application and eviction proceedings. Order XXX C.P.C. specifically provides that partners may sue or be sued in the name of the firm of which they are partners at the time of accruing of the cause of action. Therefore, there is no error of law in arraying the firm as tenant through its partner.
(iii) Apart from above the defendant-tenant has been impleaded through its partner Subhash Chandra, who has filed his written statement and also filed counter affidavit. He also led evidences. In paragraphs 20 and 21 of his written statement he specifically alleged that the release may cause difficulty to partners and after receiving the notice the partners made effort for an appropriate accommodation but they were unsuccessful. In paragraphs 10 and 17 of the counter affidavit similar averments were made. The defendants-witnesses, namely, Sri Somanath Sharma and Sri Miraz Khan have specifically stated in paragraph 2 of their respective affidavits that the defendant is carrying on business of Hire Purchase in the disputed accommodation. Thus, the partner Subhash Chandra and four other partners contested the release application and after being unsuccessful they filed the appeal which was dismissed by the impugned judgment. Therefore, there was no defect in the array of parties.
(iv) In Chhetriya Shri Gandhi Ashram, Meerut Vs. IInd Additional District Judge, Meerut and others 1998(2) ARC 373 (paragraphs 9 to 17) Hon'ble Single Judge has clearly laid down the law that when the petition has been filed in the name of a firm, it has to be treated as a petition by all the partners constituting a firm and it is the need or requirement of those partners that has to be looked into and entertained while dealing with a petition under Section 21(1)(a) of the Act. In Her Highness Maharani Mandalsa Devi and others Vs. M. Ramnarain P. Ltd. And others, AIR 1965 SC 1718 (paragraph 4) Hon'ble Supreme Court referred to the Provisions of Order XXX Rule 1 C.P.C. and held that when a firm's name is used, it is only a convenient method of denoting those persons who compose the firm at the time when that name is used, and a plaintiff who sues partners in the name of their firm in truth sues them individually, just as much as if he had set out all their names." Therefore the decree passed in the suit, though in the form against the firm is in effect a decree against all the partners.
(v) The judgment in M/s. Chhotelal Pyarelal (supra) relied by learned counsel for the defendant-tenant/petitioner is wholly distinguishable on the facts and the statutory provisions applicable in the State of Uttar Pradesh. That apart the said judgment itself provides that the objection is merely technical and at any stage of the proceedings the partner may be allowed to be impleaded as respondent. The judgment in the case of Prabhakar Mehrotra (supra) is also clearly distinguishable on the facts of the present case.
DISCUSSION & FINDINGS:
8. I have carefully considered the submissions of learned counsel for the parties. A copy of the written statement and the counter affidavit filed by the defendant-tenant/petitioner before the Prescribed Authority, has been produced by learned counsel for the plaintiff-landlady/respondent which has not been disputed by the learned counsel for the defendant-tenant/petitioner.
9. There is no dispute of landlord and tenant relationship between the plaintiff-landlady/respondent and the defendant-tenant/petitioner.
10. Perusal of the array of parties as mentioned in the release application shows that the firm has been impleaded as respondent being tenant through its partner Subhash Chandra. There is no dispute that the aforesaid Sri Subhash Chandra is the partner and the business is being carried on by him alongwith other partners under the name and style of the firm M/s.Shanti Motor Finance Company. In paragraph 20 of the written statement and in paragraph 17 of the counter affidavit, the aforesaid Sri Subhash Cnadra partner has specifically stated on his personal knowledge that after receipt of the notice of the release application the partners of the firm have made every effort for another appropriate accommodation on rent but they could not get success and if the defendant is evicted then its all partners and their family members shall face difficulty. Thus, it is evident from their own written statement and counter affidavit of the defendant-tenant that the firm through its partner Sri Subhash Chandra and the aforesaid partner Subhash Chandra was contesting the release application on behalf of all the partners, collectively as firm. Thus, on facts, there is no substance in the submission of learned counsel for the defendant-tenant/petitioner that the release application was liable to be dismissed on the ground of non joinder of necessary party i.e. partners.
11. Section 3(a) and Section 3(j) of the Rent Act 1972, defines the words "tenant" and "landlord" as under:
(a) "tenant", in relation to a building, means a person by whom its rent is payable, and on the tenant's death--
(1) in the case of a residential building, such only of his heirs as normally resided with him in the building at the time of his death;
(2) in the case of a non-residential building, his heirs];
[Explanation.-- An occupant of a room in a hotel or a lodging house shall not be deemed to be a tenant];
(j) "Landlord", in relation to a building, means a person to whom its rent is or if the building were let, would be, payable and includes, except in clause (g), the agent or attorney, or such person;
12. The word "person" as used in the aforesaid two provisions have not been defined under the Rent Act. The word "person" has been defined in Section 4(33) of the U.P. General Clauses Act, 1904 as under :
"persons" shall include any company or association or body of individuals, whether incorporated or not;"
13. Rule 10(6)(a) of the Rent Rules 1972, relates to allotment of non residential building. It recognises allotment of an accommodation to a firm. The proviso to Rule 10(6) of the Rent Rules 1972, is reproduced below:
"(a) if the District Magistrate is satisfied in a case referred to in section 12(2) that the admission of partner or new partner is bona fide transaction and not a mere cover for sub-letting, he shall, if any application had been made in that behalf before the admission of such partner or new partner, allot the non-residential building in question afresh to the newly constituted or re-constituted firm;"
14. Section 38 of Rent Act, 1972, provides for overriding effect of the provisions of the Act as under:
"Act to override T.P. Act and Civil Procedure Code.- The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in the Transfer of Property Act, 1882 (Act No. IV of 1882), or in the Code of Civil Procedure, 1908 (Act No. V of 1908)."
15. Section 4 of the Indian Partnership Act, 1932 (hereinafter referred to as "the Act 1932"), provides as under:
"Section 4 - Definition of "partnership", "partner", "firm" and "firm name"
"Partnership" is the relation between persons who have agreed to share the profit of a business carried on by all or any of them acting for all.
Persons who have entered into partnership with one another are called individually "partners" and collectively "a firm", and the name under which their business is carried on is called the "firm name".
16. A conjoint reading of the provisions of the Rent Act 1972, as aforequoted, leaves no manner of doubt that the Act itself recognises a firm as tenant. Section 12 of the Act provides for a deeming clause for cesation to occupy a building by landlord or tenant. The word "landlord" and "tenant" have been defined in Section 3(a) and Section 3(j) which uses the word "person". Sub-section 2 of Section 12 provides for the circumstances when the tenant of a non residential building shall be deemed to have ceased to occupy the building. The proviso (a) to Rule 10(6) of the Rules provides for an exception that if the District Magistrate is satisfied in a case referred to in Section 12(2) that the admission of partner or new partner is bona fide transaction and not a mere cover for sub-letting, he shall, if any application had been made in that behalf before the admission of such partner or new partner, allot the non-residential building in question afresh to the newly constituted or re-constituted firm. Thus, allotment to a person includes an allotment to a newly constituted or reconstituted firm. This being the statutory position, the provisions of Order XXX Rule 1 C.P.C. can not be said to be in conflict with the provisions of Section 38 of the Rent Act 1972. Order XXX Rule 1 C.P.C. which provides as under:
"Suing of partners in name of firm.- (1) Any two or more persons claiming or being liable as partners and carrying on business in India may sue or be sued in the name of the firm (if any) of which such persons were partners at the time of the accruing of the cause of action, and any party to a suit may in such case apply to the court for a statement of the names and addresses of the persons who were, at the time of the accruing of the cause of action, partners in such firm, to be furnished and verified in such manner as the court may direct.
(2) Where persons sue or are sued as partners in the name of their firm under sub-rule (1), it shall, in the case of any pleading or other document required by or under this Code to be signed, verified or certified by the plaintiff or the defendant, suffice if such pleading or other document is signed, verified or certified by any one of such persons."
17. Thus, in view of the above discussion, I have no difficultly to hold that the release application filed by the plaintiff-landlady/respondent arraying the firm through its partner Subhash Chandra, does not suffer from non joinder of necessary party.
18. The conclusion reached by me is also supported by the law laid down by another Bench of this Court in Chhetriya Shri Gandhi Ashram, Meerut (supra) in which the Court held as under:
"16. Initiating a proceeding by or against a partnership firm is a matter of procedure as observed by the Hon'ble Supreme Court in Malabar Fisheries' case (supra), is permitted by Order XXX of the Civil Procedure Code and under the Rules of the Code. There is no illegality if the same procedure is adopted in proceedings under Section 21(1)(a) of the Act, by a partnership firm, making an application through a partner. In my view, therefore, the petition could not be said to have been illegally filed in the name of the firm and in any case such a technical objection cannot be raised at such a late stage and by showering surprise time on the other side.
17. As regards the question that a release order under Section 21(1)(a) can be made only in favour of a legal person, the same does not have any merit in view of what has been discussed above. When the petition has been filed in the name of a firm, it has to be treated as a petition by all the partners constituting the firm and it is the need or requirement of those partners that has to be looked into and entertained while (dealing) with a petition under Section 21(1)(a). It may again be emphasised that in this case the requirement set up for seeking eviction of the petitioner was not the requirement of any individual partner or a member of his family independently of the firm. The property in suit was not an asset of the firm and the requirement that was set up for seeking the eviction of the petitioner was for the business requirement of the firm i.e. the partners. It, therefore, cannot be said that the requirement that was set up was not of any legal person. It was the requirement of the partners, who were legal persons and who were carrying on business under a firm name and require the property in question for the purposes of the business. These contentions, therefore, have no force and are hereby rejected."
(Emphasis supplied by me)
19. The judgment of Hon'ble Supreme Court in the case of Her Highness Maharani Mandalsa Devi (supra) also supports the aforesaid view.
20. From the judgment of Hon'ble Supreme Court in the case of M/s. Chhotelal Pyarelal (supra) relied by learned counsel for the defendant-tenant/petitioner, it appears that it relates to the provision of C.P. and Berar Letting of Houses and Rent Control Order 1949 and not to the U.P. Rent Act 1972. In this judgment Hon'ble Supreme Court found that the Provisions of Code of Civil Procedure does not apply to the proceedings under the HRC Orders and, therefore, no application for eviction can be maintained against the firm in the firm name. Yet Hon'ble Supreme Court held that this can not by itself result in the dismissal of the application. It would be merely a case of misdescription of the respondent of the application and this misdescription can be corrected at any stage of the proceedings. It further held that there can be no doubt that the partners of the firm are before the Court though in a wrong name. Accordingly, Hon'ble Supreme Court permitted for amendment in the array of parties to amend the cause title of the original eviction application. Thus, even this judgment is of no help to the defendant-tenant/petitioner on the facts of the present case and relevant statutory provisions.
21. The judgment in the case of Prabhakar Mehrotra (supra) relied by learned counsel for the defendant-tenant/petitioner is also distinguishable on facts and the statutory provisions as stated above.
22. The second argument of learned counsel for the defendant-tenant/petitioner has some substance. From perusal of the release application, I find that the plaintiff-landlady/respondent has set up her own bonafide need for the disputed shop. The Prescribed Authority came to the conclusion that the plaintiff-landlady has established her bonafide need. The appellate court, instead of examining the bonafide need of the landlady, dismissed the appeal on the ground that she has bonafide need of the disputed shop for her son. Thus, there is no consideration by the appellate court on the crucial point of her own bonafide need of the landlady for the disputed shop. Therefore, the impugned judgment of the appellate court suffers from manifest error of law and facts. Therefore, it deserves to be quashed on this point only.
23. In result, the writ petition succeeds and is hereby allowed. The impugned judgment dated 16.2.2018 in P.A. Appeal No.02 of 2017 (M/s. Shanti Motor Finance Company through its partner Subhash Chandra Vs. Kusum Sharma), passed by the District Judge, Pilibhit, is quashed only on the point of bonafide need and the matter is remitted back to the appellate court. The appeal is restored to its original number which shall be decided afresh by the appellate court only on the issue of bonafide need of the landlady for the disputed shop as per case set up by her in her release application. It is expected that the appellate court shall decide the appeal expeditiously, preferably, within three months from the date of presentation of a certified copy of this order.
Order Date :- 22.3.2018/vkg