Bombay High Court
M/S. Motichand And Company vs Life Insurance Corporation on 23 January, 2013
Equivalent citations: AIR 2013 (NOC) 338 (BOM.), 2013 (2) ABR 289, (2013) 2 MAH LJ 252, (2013) 2 ALLMR 758 (BOM), (2013) 124 ALLINDCAS 339 (BOM), (2013) 3 BOM CR 640
Author: A.M.Khanwilkar
Bench: A.M.Khanwilkar, K.K.Tated
LPA.11&12.2013.judgment.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
APPELLATE SIDE
LETTERS PATENT APPEAL NO. 11 OF 2013
IN
CIVIL WRIT PETITION NO. 3001 OF 2012
WITH
CIVIL APPLICATION NO. 18 OF 2013
IN
LETTERS PATENT APPEAL NO. 11 OF 2013
1. M/S. MOTICHAND AND COMPANY
2. MOTICHAND CONSTRUCTION
CO. PVT. LTD.
3. SHRI. SHIRISH B. PATEL
4. M. G. CHARITABLE TRUST
All having their address at and
occupying T. C. No. 3474, 2nd floor,
United Building, Sir. PM Road,
Fort, Mumbai 400001 :- APPELLANTS
VERSUS
1. LIFE INSURANCE CORPORATION
OF INDIA
a statutory corporation established
by the Central Act XXXI of 1956
having its Western Zonal Office at
Yogakshema, East Wing,
Jeevan Bima Marg,
Mumbai 400021
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2. THE ESTATE OFFICER OF
THE LIFE INSURANCE CORPORATION
OF INDIA,
having his office at Yogakshema,
West Wing, Ground Floor,
Jeevan Bima Marg,
Mumbai 400021
3. PATEL ENGINEERING CO. LTD.
T. C. No: 3474, Second Floor,
United Building, Sir. PM Road,
Fort, Mumbai 400001 :- RESPONDENTS
WITH
LETTERS PATENT APPEAL NO. 12 OF 2013
IN
CIVIL WRIT PETITION NO. 3333 OF 2012
WITH
CIVIL APPLICATION NO. 19 OF 2013
IN
LETTERS PATENT APPEAL NO. 12 OF 2013
PATEL ENGINEERING LIMITED
having its address and occupying
TC No. 3474, Second floor,
United India Building, Sir. PM Road,
Fort, Mumbai - 400001 :- APPELLANT
VERSUS
1. LIFE INSURANCE CORPORATION
OF INDIA
A Statutory Corporation established
under The Central Act No. XXXI of 1956,
having its Western Zonal office at
Yogakshema, East Wing,
Jeevan Bima Marg, Mumbai 400021
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2. THE ESTATE OFFICER OF
THE LIFE INSURANCE CORPORATION
OF INDIA,
having its Western Zonal office at
Yogakshema, East Wing,
Jeevan Bima Marg, Mumbai 400021
3. M/S. MOTICHAND AND COMPANY
4. MOTICHAND CONSTRUCTION
COMPANY PVT. LTD.
5. SHRI. SHIRISH B. PATEL
6. BOMBAY POTTERIES AND
TILES LTD.
7. M. G. CHARITABLE TRUST
All having their respective addresses at
TC No. 3474, Second floor,
United India Building,
Sir. PM Road, Fort, Mumbai 400001 :- RESPONDENTS
Mr. Aspi Chinoy, Senior Counsel, Mr. Dinyar Madon, Senior
Counsel, Mr. Snehal Shah, Mr. Gautam Patel, Mr. Deepak Rai and
Ms. Jyoti Sinha, i/b. M/s. Negandhi, Shah and Himayatullah, for
the Appellants in LPA/11/2013 and for Respondent Nos. 3, 4 and 7
in LPA/12/2013.
Mr. M. S. Doctor, with Mr. U. Anklesaria, Mr. Ranjit Shetty, Ms.
Sonam Dorji, i/b. M/s. Juris Corp., for the Appellants in
LPA/12/2013.
Mr. R. S. Apte, Senior Counsel, with Mr. Ajay Khaire, i/b. M/s. The
Law Point, for Respondent No. 1.
CORAM:- A.M.KHANWILKAR &
K.K.TATED,JJ.
Judgment Reserved on :- JANUARY 18, 2013
Judgment Pronounced on :- JANUARY 23, 2013
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JUDGMENT :- (Per A.M.KHANWILKAR, J.) Heard Counsel for the parties.
2) Both these Appeals are directed against the selfsame impugned decision of the Learned Single Judge, confirming the order of eviction and recovery of damages, passed by the Estate Officer, under the provisions of the Public Premises (Eviction of Unauthorised Occupants) Act, 1971 (hereinafter referred to as "the Act of 1971").
3) Letters Patent Appeal No. 11 of 2013 has been filed by the Original Opponent Nos. 1 (a proprietary concern), 2, 3 and 7 and Letters Patent Appeal No. 12 of 2013 has been filed by the Original Opponent No. 5. The issues raised in both these Appeals are overlapping, therefore, we propose to dispose of these Appeals together, by this common order.
4) The Estate Officer, in exercise of enabling provisions in the Act of 1971, initiated action of eviction, against Opponent Nos.
1 to 7 on the ground that Opponent No. 1, who was the lessee in Page 4 of 23 J.V.Salunke,PA ::: Downloaded on - 09/06/2013 19:35:19 ::: LPA.11&12.2013.judgment.doc respect of the premises, which are admittedly public premises, unlawfully sublet the premises to Opponent Nos. 2 to 7, without any authority or permission from the Corporation, the owner of the premises. Further, the Opponent Nos. 2 to 7 were in unauthorised use and occupation of the said premises, without any authority from the Corporation. Their entry in the premises was, ab initio, as unauthorised occupants. Moreover, the original lessee
- Opponent No. 1 did not require the said premises for its own use. Lastly, the tenancy and authority of Opponent No. 1 has been terminated in accordance with law, vide notice dated 15 th September, 2000 and inspite of that the Opponents have failed to comply with the said notice; as a result whereof, were in unauthorised occupation of the premises and liable to be evicted and to pay damages, with interest, jointly and severally. The Estate Officer, after giving opportunity to the Opponents, by his decision dated 17th October, 2011, directed the eviction of the Opponents from the said premises under Section 5(1) of the Act and to recover damages from them with interest under Section 7(2)(2A) of the Act.
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5) The Estate Officer framed six points for consideration, on the basis of the plea taken by the parties. Firstly, whether the Opponents prove that application under consideration was mischievous, false, frivolous and fictitious and liable to be dismissed with cost. Secondly, whether the notice of termination dated 15th September, 2000 was valid. Thirdly, whether the applicants have proved that the Opponent No. 1 sublet the scheduled premises to Opponent Nos. 2 to 7 and thereby breached terms and conditions of the tenancy and the Opponent No. 1 did not require the tenanted premises for its own use and occupation.
Fourthly, whether the Opponents were in unauthorised occupation of the premises and if so, from what date? Fifthly, whether the Opponents were liable to be evicted from the scheduled premises and lastly, whether the Opponents were liable to pay damages with interest and if so, at what rate and from which date?
6) The Estate Officer answered all these issues against the Opponents on the finding that the tenancy of Opponent No. 1 was validly terminated because of the breach of terms and conditions of the tenancy, as a result of inducting Opponent Nos. 2 to 7 in the Page 6 of 23 J.V.Salunke,PA ::: Downloaded on - 09/06/2013 19:35:19 ::: LPA.11&12.2013.judgment.doc premises, without prior permission of the Corporation and allowing them to occupy the premises unauthorisedly. Secondly, the termination notice was validly served on Opponent No. 1, the lessee. These conclusions have been reached on the finding that the tenancy in relation to the said premises, created in favour of Opponent No. 1, was on month to month basis and was terminated vide notice dated 15th September, 2000 in compliance with the requirements of Section 106 of the Transfer of Property Act, which position was indisputable. Consistent with these findings, the Estate Officer issued order of eviction against Opponent Nos. 1 to 7 as also directed them to pay of damages, along with Interest.
This decision has been confirmed not only by the City Civil Court in Appeal but also by the Learned Single Judge of this Court, by dismissing the Writ Petition filed by the Opponents. In view of concurrent finding of fact recorded against the Opponents in these proceedings, the Learned Single Judge was justified in not interfering in exercise of Writ Jurisdiction therewith.
7) As regards the finding of fact recorded by the Estate Officer and confirmed by the Court, about the termination notice, Page 7 of 23 J.V.Salunke,PA ::: Downloaded on - 09/06/2013 19:35:20 ::: LPA.11&12.2013.judgment.doc having been validly served on the Opponents and in particular Opponent No. 1 (the lessee), is not in issue. In other words, the grievance is not about non compliance of requirements of Section 106 of the Transfer of Property Act, of sending notice in writing, terminating the rights/tenancy, to be served on the lessee, in the manner provided. The grievance of the Appellants, however, is that there was no legal ground available for termination of tenancy of Opponent No. 1. We shall immediately advert to this grievance of the Appellants.
8) No doubt, Opponent Nos. 2, 4, 5 and 7 were inducted in the premises before the Respondent Corporation took over the Oriental Security Life Insurance Company Limited in 1956.
Ostensibly, the former owner of the premises did not object to induction of the said Opponents by Opponent No. 1 (original lessee) in the premises. On this assertion, it is argued that it was not open to the Respondent Corporation to proceed against the Opponent No. 1 - lessee, much less to terminate its tenancy on that ground, that too after lapse of 44 years from becoming owner of the property. Moreso because the Respondent Corporation was Page 8 of 23 J.V.Salunke,PA ::: Downloaded on - 09/06/2013 19:35:20 ::: LPA.11&12.2013.judgment.doc fully aware about the occupation of premises by those Opponents, along with the Opponent No. 1 lessee, inter alia, having inquired into that aspect, while examining the issue of revision of ratable value of the premises in the year 1962. In other words, the Respondent Corporation, in any case, has acquiesced of and/or waived the factum of induction of the said occupants in the premises by Opponent No. 1 lessee and for which reason, it cannot be made a ground for termination of tenancy of Opponent No. 1 in respect of the premises, in the year 2000.
9) Indeed, the factual position, as asserted by the Opponents, with regard to induction of Opponent Nos. 2, 4,5 and 7 prior to 1956 and about the knowledge of their induction, much less acquired in the year 1962 by the Respondent Corporation, while considering the issue of revision of ratable value of the premises, is indisputable. For the time being, however, we may not dilate on the other contentions pressed into service by the Appellants vis a vis the induction of Opponent Nos. 2, 4, 5 and 7 by Opponent No. 1 and occupation of the premises by them, without prior permission of the Respondent Corporation, the Page 9 of 23 J.V.Salunke,PA ::: Downloaded on - 09/06/2013 19:35:20 ::: LPA.11&12.2013.judgment.doc owner, as they were inducted prior to the Respondent Corporation became owner of the premises in the year 1956. For the purpose of considering the matter in issue, it is enough to note that it is common ground that Opponent No. 3 (Shirish Patel), an Architect and son-in-law of Motichand G. Shah - proprietor of Opponent No. 1, was also inducted by Opponent No. 1 to use part of the premises as his office, in the year 1963, without prior permission, much less in writing, of the Respondent Corporation, who had already become owner of the premises, in the year 1956. This being indisputable position, the question is, whether any fault can be found with the termination of tenancy of Opponent No. 1 on that count. The termination notice dated 15th September, 2000 asserts that Opponent No. 1 was fully aware that as per the terms and conditions of tenancy, the premises were let out to it "for its own business" and did not permit subletting or induction of any third party in any part of the premises so let out. Nevertheless, Opponent No. 1, unilaterally, inducted named persons including Opponent No. 3 in the said premises and allowed them to occupy the same unauthorisedly. This was in flagrant breach and violation of the terms and conditions of the tenancy. On this basis also, the Page 10 of 23 J.V.Salunke,PA ::: Downloaded on - 09/06/2013 19:35:20 ::: LPA.11&12.2013.judgment.doc monthly tenancy in favour of Opponent No. 1, in respect of the said premises, came to be justly terminated.
10) The Appellants, however, would submit that the occupation of the premises by the Opponent No. 3 son-in-law of Motichand G. Shah, would neither result in subletting nor otherwise parting with possession of the premises. To buttress this submission, reliance is placed on the decisions of the Apex Court in the case of Gopal Saran vs. Satyanarayana1; Dipak Banerjee vs. Lilabati Chakraborty2; Jagan Nath (deceased) Through Lrs.3 and lastly, unreported decision of the Division Bench of this Court, in the case of Nandini J. Shah and Anr. vs. Life Insurance Corporation of India and Ors.4 decided on 12th October, 2012.
11) This submission clearly overlooks that the present proceedings are arising from the action initiated under the provisions of the Public Premises Act. It is indisputable that the terms and conditions of tenancy, created in favour of Opponent No. 1, did not authorise Opponent No. 1 to induct any third party 1 1989 (3) SCC 56 2 1987 (4) SCC 161 3 1988 (3) SCC 57 4 LPA/181/2012 Page 11 of 23 J.V.Salunke,PA ::: Downloaded on - 09/06/2013 19:35:20 ::: LPA.11&12.2013.judgment.doc in any part of the premises, that too without prior permission of the owner (lessor). The provisions of Rent Control Legislation have no application to the premises. The three decisions of the Apex Court, which are pressed into service essentially consider the purport of term "subletting and otherwise parting with the possession of the premises" in the context of the provisions contained in the Rent Control Legislation. The expression "otherwise parting with the possession of the whole or part of the premises", as occurring in the concerned Rent Control Legislation envisage user of the premises by other person without the lessee retaining the legal possession himself. In other words, the user of the premises, by other person, is not parting with possession so long as the tenant retains the legal possession himself. The tenant must, by his acts of commission and omission, allow vesting of possession of the premises in another person by divesting his not only physical possession but also all the rights of possession. In the present case, however, the finding of fact, recorded by the Estate Officer and confirmed by the City Civil Court and the Learned Single Judge of the High Court, is that, the tenant Opponent No. 1, in its letter dated 6th June, 1995 has admitted Page 12 of 23 J.V.Salunke,PA ::: Downloaded on - 09/06/2013 19:35:20 ::: LPA.11&12.2013.judgment.doc that the Opponents, including Opponent No. 3, was in occupation of the part of the premises, in the capacity of sub-tenant.
Considering this admission of Opponent No. 1, the hairsplitting argument now canvassed to assert that it is not a case of giving rise to legal ground to proceed against Opponent No. 1 for having parted with possession of the premises to Opponent No. 3, cannot be countenanced.
12) Notably, it is indisputable that Opponent No. 3 has a fully established office of Architects, which is operated independently from portion of the said premises. The lessee (Opponent No. 1) has no causal connection with the said profession of architecture, in which Opponent No. 3 is engaged.
Further, it is indisputable position that Opponent No. 3 was inducted in the portion of the premises without obtaining prior permission of the Respondent Corporation, much less in writing.
There is no evidence on record to even remotely suggest that the Respondent Corporation had excused or condoned the occupation of Opponent No. 3 in the said premises. In other words, the Opponent No. 3 was in unauthorised occupation of the premises.
Page 13 of 23J.V.Salunke,PA ::: Downloaded on - 09/06/2013 19:35:20 ::: LPA.11&12.2013.judgment.doc The fact that Opponent No. 1 happens to be his father-in-law, would make no difference. In the context of the terms of tenancy and more particularly for the purpose of the said Act, occupation of the part or whole of the public premises, by third party, without authority given by the Appropriate Authority, would be unauthorised occupation and thus actionable. The term unauthorised occupation is defined in Section 2(g), which reads thus:-
"(g) "unauthorised occupation", in relation to any public premises, means the occupation by any person of the public premises without authority for such occupation, and includes the continuance in occupation by any person of the public premises after the authority (whether by way of grant or any other mode of transfer) under which he was allowed to occupy the premises, has expired or has been determined for any reason whatsoever."
13) The expression "unauthorised occupation" is an inclusive term. It means use or actual occupation by any person of the public premises without authority. This cannot be equated with the term subletting or otherwise parting with possession, as contained in the Rent Control Legislation, which is of higher degree. In a given case, as in the present one, use and occupation of the part of the public premises by Opponent No. 3 for his office of Architecture - which is unconnected with the business of the Page 14 of 23 J.V.Salunke,PA ::: Downloaded on - 09/06/2013 19:35:20 ::: LPA.11&12.2013.judgment.doc lessee (Opponent No. 1) for which purpose the premises were let out to him, even while the lessee (Opponent No. 1) retained the legal possession of the premises himself, would invite action and therefore, can be just reason to terminate the tenancy of the lessee, by issuing termination notice under Section 106 of the Transfer of Property Act. The definition of unauthorised occupation, contained in the said Act would thus encompass use and actual occupation of the part or whole of the public premises by person other than the lessee for his business or profession which is unconnected with the activities of the lessee and for which purpose the premises were let out to the lessee and moreso when the lessee has no concern with the business or profession of that person.
14) To get over this position, Counsel for the Appellants had relied on the decision of the Division Bench of this Court in the case of Nandini J. Shah (supra). In that case, the eviction of the Appellants from public premises was sought on the ground that Vilasben, the original lessee, transferred the premises and part thereof to three companies. The lessee contended that these companies were closely held family concerns and it was not a case Page 15 of 23 J.V.Salunke,PA ::: Downloaded on - 09/06/2013 19:35:20 ::: LPA.11&12.2013.judgment.doc of assignment in their favour or the original tenant having lost control over the premises. The Court found that Vilasben was director and shareholder of the companies. The Court then noted that the tenant, while retaining the control of the business, including her relatives - son, daughter, husband formed private limited company; and even if the company may have separate juristic entity in law, in that case, action under the Public Premises Act cannot be countenanced. This decision, in our view, is of no avail to the Appellants. Firstly because, in the present case, Opponent No. 1 has nothing to do with the profession of Opponent No. 3, who has been allowed to use and occupy part of the public premises for his independent profession, without permission of the Corporation. Merely because Opponent No. 3 is the son-in-law of Opponent No. 1 would not extricate the Opponent No. 1 from ensuring that no other person should be allowed to occupy the public premises let out to it, who is not directly associated with the business of the lessee or when the lessee has no stakes in the business of that person. The Respondent Corporation having issued termination notice dated 15th September, 2000, on this count, permission given to and authority vested in the Opponent Page 16 of 23 J.V.Salunke,PA ::: Downloaded on - 09/06/2013 19:35:20 ::: LPA.11&12.2013.judgment.doc No. 1, to use and occupy the premises, is snapped and on receipt of termination notice, the Opponent No. 1, along with the other occupants claiming through the Opponent No. 1, ought to have acted upon the notice, by vacating the premises. Having failed to do so, each one of them, on and from expiry of termination notice period, has become unauthorised occupant of the premises and for which reason, amenable to action under Section 4 of the Act of 1971.
15) In the circumstances, we find no merits in the challenge to the conclusion reached by the Estate Officer and as confirmed by the City Civil Court and the Learned Single Judge of this Court, respectively. The fact that the Estate Officer or for that matter the City Civil Court and the Learned Single Judge of this Court have loosely used the expression subletting/parting with possession of the public premises does not mean that the lessee and the other occupants are extricated from the rigours of the Act of 1971. As a result, the Appeal preferred by Opponent No. 3 is devoid of merits.
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16) The Opponent No. 5 as also the other Opponents, who have filed Appeals, have merely adopted the arguments of the Counsel for the Opponent No. 3 in toto. For the reasons already stated hitherto, even the Appeal preferred by these Opponents deserve to be dismissed. This is so because, even though the Opponent Nos. 2, 4, 5 and 7 may be justified in contending that they have been inducted in the part of the said premises much before the Respondent Corporation became owner of the premises, however, once the original permission given to Opponent No. 1 to enjoy and occupy the said premises is terminated and stands cancelled, not only the Opponent No. 1, being the original lessee, but all other occupants claiming through Opponent No. 1, will have to suffer the same consequences, and are obliged to vacate the premises and follow the same suit, as they are claiming right to occupy the premises only through Opponent No. 1. There is no concept of sub-tenancy or for that matter protected sub-tenant in relation to the public premises, as is applicable to the premises governed by the provisions of Rent Control Legislation.
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17) Counsel for the Corporation has justly pressed into service exposition of the Division Bench of our High Court in an unreported decision in the case of Rai and Company vs. Life Insurance Corporation of India5, decided on 12th July, 2010.
Counsel for the Corporation has also pressed into service another decision of the Apex Court in the case of Ashoka Marketing Limited vs. Punjab National Bank and Ors.6 and contended that the provisions of Public Premises Act would override the provisions of the Rent Control Legislation.
18) Considering the above, as the premises are public premises and Opponent No. 1 was lessee therein on month to month basis and its tenancy having been validly terminated because of allowing Opponent No. 3 to occupy part of the premises unauthorizedly, without obtaining prior written permission of the Respondent Corporation, by issuance of termination notice dated 15th September, 2000, the relationship between the owner (lessor) of the premises and the lessee (Opponent No. 1) would automatically get snapped on the expiry of the notice period. As a 5 WP/2333/2010 6 1994 SCC 406 Page 19 of 23 J.V.Salunke,PA ::: Downloaded on - 09/06/2013 19:35:20 ::: LPA.11&12.2013.judgment.doc result whereof, not only Opponent No. 1 original lessee but, other occupants claiming through him and occupying part of the premises were obliged to comply with the termination notice and vacate the premises forthwith. Having failed to do so, the Estate Officer was justified in proceeding against all the Opponents for having become unauthorised occupants, by invoking remedy under the provisions of the said Act.
19) As regards the argument that, even though the factum of occupation of the part of the premises by Opponent No. 3 had come to the notice of the Respondent Corporation, at least in 1984, the Respondent Corporation, having failed to initiate any action in that behalf, has acquiesced or waived the right to proceed against Opponent No. 1, deserves to be stated to be rejected. As aforesaid, the concurrent finding of fact is that the Corporation has not, even remotely, recognised the occupation of part of the premises by Opponent No. 3, as legitimate. There is no evidence to record a finding of tacit consent, much less of waiver and acquiescence in that regard. As a result, there is nothing wrong if the Corporation decided to initiate action, in the year 2000, by issuance of termination notice dated 15th September, 2000.
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20) The next issue agitated before us is that the amount of damages, determined by the Estate Officer, is untenable and cannot be sustained in law. It was argued that the valuation report, on the basis of which the conclusion has been reached, is replete with infirmities. Moreover, the basis on which amount of damages has been quantified is not substantiated. We are not impressed by this grievance. We find merits in the submission of the Respondent Corporation that the Estate Officer has dealt with the issue of levy of damages and the quantum thereof on the basis of the valuation report and other evidence, for determining the damages required to be paid, which finding does not merit any interference. That conclusion has been confirmed, right up to this Court, by rejection of the Writ Petition filed by the Appellants. The Estate Officer, in the first place, adverted to the claim of the Respondent Corporation, as noted in the application. That claim was supported by valuation report dated 12th December, 2003. It is noticed that the area of the premises in question is around 5060 sq.ft. built up. The valuer, after adverting to the source of valuation and keeping in mind the total area of the premises has worked out the damages amount as Rs. 2,31,849 per month. The Page 21 of 23 J.V.Salunke,PA ::: Downloaded on - 09/06/2013 19:35:20 ::: LPA.11&12.2013.judgment.doc evidence of valuer Harendra Dalal (AW-2) has been analysed and the Estate Officer has then noted that the said witness was cross examined by the Opponents. Thereafter, the Estate Officer held that the market rate arrived at by the valuer was keeping in mind relevant factors, such as locality, location, type of accommodation, facilities available, cost of construction of the property, approximate remaining life time, depreciation, present condition of the property or of construction etc., as stipulated in Rule 8 of the Public Premises Rules, 1971. The Estate Officer has also recorded a finding of fact that in the cross examination of the applicant's valuer, nothing adverse was brought to light by the Opponents. On accepting the said valuation report and on analysing the other evidence in support thereof, the Estate Officer proceeded to conclude that the Opponents were liable to pay damages at the rate so computed, being prevailing market rate of the premises at the relevant time and ordered to pay the same with interest w.e.f. 1st January, 2001; and further damages at the same rate.
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21) We are not inclined to overturn the said finding and conclusion. We cannot sit in appeal over the said finding and conclusion merely because another view may also be possible. The said finding of fact having found to be unexceptionable; and having been confirmed by the two Courts, we decline to interfere with the said opinion.
22) In view of the above, we find that these Appeals are devoid of merits and are, therefore, dismissed. Accompanying Civil Applications are also dismissed.
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