Bombay High Court
Life Insurance Corporation Of India vs Horological Trades And Agencies And ... on 2 December, 1991
Equivalent citations: 1991(4)BOMCR285
JUDGMENT S.M. Daud, J.
1. This revision is by the decree-holder aggrieved by a decision of the Appellate Bench of the Court of Small Causes at Bombay upon an appeal in obstructionist proceedings.
2. The decree-holder/petitioner is the owner of property known as Indian Globe Chambers at 142, Fort Street, Bombay-400 001. judgment-debtor/respondent No. 2 was a tenant in respect of a portion of the aforementioned building. On 12th October, 1966, the decree-holder gave a quit notice to the judgment-debtor terminating its tenancy and calling upon the judgment-debtor to deliver vacant and peaceful possession to it by a particular date. The notice not having been complied with, the decree-holder filed a suit for ejectment the grounds being that the judgment-debtor was irregular in payment of rent and further that it had sub-let the premises which sub-letting was impermissible, whether considered under the contract of tenancy or the law. The judgment-debtor filed a written statement contesting the suit for ejectment filed by the decree-holder. While the suit was pending the Bombay Rents, Hotel and Lodging house Rates Control Act, 1947, (Rent Act) came to be amended the amending Act being known as Amendment Act XVII of 1973. This brought on the statute book section 15-A worded as follows :-
"Section 15-A:
(1) Notwithstanding anything contained elsewhere in this Act or anything contrary in any other law for the time being in force, or in any contract, where any person is on the 1st day of February, 1973 in occupation of any premises or any part thereof which is not less than a room, a licensee, he shall on that date be deemed to have become, for the purposes of this Act, the tenant of the landlord, in respect of the premises or part thereof, in his occupation.
(2) The provisions of sub-section (1) shall not affect in any manner the operation of sub-section (1) of section 15 after the date aforesaid."
The said suit came up before a learned Judge of the Small Causes Court on 1-8-1973 and the decree-holder examined its witness who was a Building Inspector in the employ of the said decree-holder. The witness, amongst other things, said that the judgment-debtor had lawfully sub-let the premises in breach of the Rent Act, that judgment-debtor was not in occupation of the suit premises since before the date of the notice, and that the premises were in the occupation of some other persons names were not known to the witness. Upon this, the learned Judge delivered the following judgment- judgment-debtor not then being present and having been proceeded against exparte :
"There is no reason to disbelieve the evidence of the plaintiffs' witness. The tenancy of the defendants has been duly terminated. Ex parte decree against the defendants. Defendants to vacate the suit premises within one month and pay Court costs and professional costs of Rs. 75/-."
On 21-12-1973, the decree-holder, levied execution. When it went to take possession an obstruction was raised by the 1st respondent. To get this obstruction removed, the decree-holder took out proceedings under Order XXI, Rule 97 of the Civil Procedure Code, 1908. The said proceeding was registered as obstructionist Notice No. 19 of 1974. The stand taken by the decree-holder was that respondent No. 1 had no right to obstruct, and, that it's obstruction being unjustified had to be removed. Respondent No. 1 contested the notice contending that they were in occupation of the premises since prior to the notice terminating the tenancy of the judgment-debtor and having regard to the law prevailing, they had become direct tenants of the decree-holder. The decree-holder had not obtained a decree for ejectment against them and the obstructionist proceeding was misconceived in law. The learned Judge hearing the obstructionist notice held that having regard to the factual position the licence in favour of respondent No. 1 stood determined along with determination of the tenancy of defendant No. 1, which tenancy stood determined consequent to the quit notice dated 12-10-1966. Respondent No. 1 was a mere licensee and could not have any right subsisting after the termination of the tenancy of the judgment-debtor. The notice was made absolute and this verdict was questioned in an appeal to a Bench of two Judges of the same Court. The Bench differed from the Court of the first instance. It held that the termination of the judgment-debtor's tenancy had no effect on the validity and effectiveness of the licence created on 24th September, 1966, this being the date on which respondent No. 1 was inducted into the premises by the judgment-debtor. It negatived the decree-holder's contention that respondent No. 1 was not a licensee, but a sub-tenant, to whom section 15-A of the Rent Act did not apply. The order of the Court of the first instance was set aside and the obstructionist notice was discharged with no order as to costs. It is this erdict of the Appellate Bench which is questioned in the present revision.
3. A preliminary objection is taken by respondent No. 1 to the maintainability of the C.R.A. The argument is that the order passed by the Appellate Bench is not revisable. Section 115 of the Civil Procedure Code, appears (a) to have exercised a jurisdiction not vested in it by law, or (b) to have failed to exercise a jurisdiction so vested, or (c) to have acted in the exercise of its jurisdiction illegally or with material irregularity. Learned Counsel for respondent No. 1 argues that the Appellate Bench had the power to entertain an appeal against the judgment of the Court of the first instance. Therefore, it exercised the jurisdiction vested, when it entertained, heard and decided the appeal. Neither did it fail to exercise jurisdiction vested, in it when it answered different questions raised before it in appeal. But there still remains clause (c) of sub-section (1) of section 115, and, the question before me is whether the Appellate Bench can be said to have exercised its jurisdiction illegally or with material irregularity. This question cannot be decided in isolation from the merits and I therefore, now proceed to a consideration of the same.
4. Mr. Kapadia submits that the Appellate Bench erred in holding that section 15-A of the Rent Act was attracted to the case of the 1st respondent. On the own showing of this respondent, it came on the premises on 24th September, 1966. Even if respondent No. 2 had the power to create a licence that power stood determined when the tenancy of the judgment-debtor was terminated. The law could not countenance the continuance of the licence despite the termination of the tenancy. Consequently, the licence stood in operative as on the date on which the judgment-debtor's tenancy came to an end. That termination was much prior to 1-2-1973, and respondent No. 1 could not avail of protection conferred by section 15-A. There is an element of plausibility in the submission and learned Counsel relies in support of this submission upon certain observations appearing in Ludhichem Agencies v. Ahmed R.V. Peer Mohame), . The observations read as follows:---
"In our opinion, the petitioner is not entitled to the benefit claimed by him. An agreement for licence can subsist and continue to take effect only so long as the licensor continues to enjoy a right, title or interest in the premises. On the termination of his right, title or interest in the premises, the agreement for licence comes to an end. If the licensor is tenant, the agreement for licence terminates with the tenancy. No tenant is ordinarily competent to grant a licence enduring beyond his tenancy. On the termination of the licensor's tenancy the licensee ceases to be a licensee. This loss of status is the point from which sub-section (2) of section 14 begins to operate and in consequence of its operation, the erstwhile licensee becomes a tenant of the landlord on the terms and conditions of the agreement.
What have we here? Saraswatibai ceased to be a tenant of any description long before February 1, 1973. The contractual tenancy came to an end when the notice to quit dated July 28,1962 took effect and the statutory tenancy terminated when the decree for ejectment was passed thereafter. Before February 1, 1973 she had ceased to be a tenant. With that, the agreement for licence stood automatically terminated. In consequence, the petitioner cannot legitimately claim to be a licensee on February 1, 1973."
But the position is made clear in paragraph 54 of the Chandravarkar Sita Ratna Rao v. Ashalata G. Guram, which paragraph is in these words:---
"It is apparent from the aforesaid observations that in the facts and circumstances in that case, it was held that licensee was not entitled to protection under section 15-A of the said Act but this Court had made it clear that but for the fact that the licence had been created after the interest of the tenant came to an end, the licensee would have been entitled to protection under section 15-A of the Act." (underlining mine).
The distinction in the present case is that the decree was passed in the instant case after 1-2-1973. Mr. Kapadia submits that allowing the licence to continue after the tenancy stood determined, would be at variance with all canons governing the law of landlord and tenant. But that is exactly what section 15-A of the Rent Act purports to do. Section 15-A operates despite anything contained elsewhere in the Rent Act, despite anything contrary in any other law which would include all laws governing the relationship of landlord and tenant or any contract. If the occupation of the person in possession on 1-2-1973 can be traced to a licence, then irrespective of the operation of the Act or any other law or any contract, the occupant gets the protection of section 15-A. Here, the licence was not affected by the termination of the tenancy of the licensor for the termination had taken place before the interest of the tenant had come to an end.
5. The other contention rightly raised by Mr. Kapadia is that the Courts below were in error in holding that the 1st respondent was in possession as a licensee. In fact the 1st respondent was a sub-tenant and this was clear from the decree for ejectment passed on 1-8-1973. The Court of the first instance some how assumed that the decree-holder was accepting the stand of respondent No. 1 being a licensee. This assumption was misplaced inasmuch as far from admitting respondent No. 1 to be a licensee, the clear stand of the decree-holder was that respondent No. 1 to be licensee, the clear stand of the decree-holder was that respondent No. 1 was a sub-tenant. In fact, the decree for ejectment was obtained on the ground of the judgment debtor having unlawfully sub-let the premises. The Court of the first instance was therefore, not right in assuming that the case set up by the decree-holder vis-a-vis respondent No. 1 was that of a licensee being in possession. The Appellate Bench went a step further to consider the circumstances and there from hold that respondent No. 1 was in fact a licenses and not a subtenant. With respect to the learned Judges of the Appellate Bench, their finding on the subject cannot be sustained. They have taken into consideration the short duration of the licence and the fact of the telephone standing in the name of the judgment-debtor, as being evidence consistent with a transaction of licence. It is not possible to see how these circumstances are consistent with a licence and not a sub-tenancy. In fact the judgment-debtor had gone out of possession and placed the premises entirely and exclusively at the disposal of the 1st respondent. This gave rise to a strong indication of respondent No. 1 being a sub-tenant rather than a licensee. It was for respondent No. 1 to refute the inference arising from the exclusivity of its possession. No such evidence was led and in fact the decree for possession obtained by the decree-holder implied a finding that an unlawful sub-letting had taken place. Holding that respondent No. 1 was a sub-tenant, the next question would be whether its obstruction is liable to be removed. Here unfortunately for the decree-holder comes the protection conferred by Maharashtra Act XVIII of 1987. A part of the amendment to section 15(2) now reads as follows:---
"The prohibition against the sub-letting of the whole or any part of the premises which have been let to any tenant, and against the assignment of transfer in any other manner of the interest of the tenant therein, contained in sub-section (1), shall, subject to the provision of this sub-section, be deemed to have had no effect in any area in which this Act was in operation before such commencement, and accordingly, notwithstanding anything contained in any contract or in the judgment, decree or order of a Court, any such-lease, assignment or transfer of any such purported sub-lease, assignment or transfer in favour of any person who has entered into possession despite the prohibition in sub-section (1), as purported sub-leasee, assignee or transfer in favour of any person who has entered into possession despite the prohibition in sub-section (1), as purported sub-leasee, assignee or transferce and has continued in possession, shall be deemed to be valid and effectual for all purposes, and any tenant who has sub-let any premises or part thereof, assigned or transferred any interest therein, shall not be liable to eviction under clause (e) of sub-section (1) of section 13."
Therefore, despite the judgment obtained by the decree-holder, the sub-letting in favour of respondent No. 1 stands validated. Respondent No. 1 cannot be said to have illegally obstructed and therefore, the revision will have to fail. Agreeing with verdict of the Appellate Bench, though not all its findings, I discharge the rule leaving parties to bear their own costs.