Bombay High Court
S.H. Karkhanis vs Lalita W/O Madhusudan Govind Bhat And ... on 13 April, 1989
Equivalent citations: 1989(2)BOMCR311, (1989)91BOMLR852, 1989MHLJ727
JUDGMENT G.F. Couto, J.
1. These two write petitions by the licensee/deemed tenant and landlady, respectively are directed against the same judgment passed on November 13, 1986 by the appellate Bench of the Small Causes court Bombay. Hence this common judgment.
2. Does section 14(2) of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947, (hereinafter referred to as "the Act" ) protect form eviction a licensee who is a deemed tenant under section 15-A even when the licence to occupy the premises was created in his favour by a tenant thereof, and that too after eviction proceedings had been initiated against the latter by the landlord which ultimately culminated in a decree for eviction and possession ? In the affirmative is such protection absolute in the sense that it operates in all the cases? These are the main questions that these petitions give rise to. Mr. Abhyankar, the learned Counsel appearing for the licensee, answered the first question in the affirmative, adding, however, that in the event any of the grounds for eviction as contemplated in sections 12 and 13 of the Act are available against the licensee/deemed tenant, a decree for eviction may be passed against him. Mr. Rane the learned Counsel appearing for the landlady, naturally, held the opposite view and contended that a licensee in whose favour a licence was created by a tenant is not protected from eviction in case decree for possession is passed in favour of the landlord and against the tenant/licensor.
3. Before addressing myself to the above question and rival contentions, I however, think it expedient and proper to deal first with the petition filed by the landlady viz. Writ Petition No. 137 of 1987 as the issue involved in it is quite narrow, being restricted only to a challenge to the findings of the courts below that the petitioner Karkhanis is not a sub-tenant but a licensee.
4. In this regard, I may at the outset, point out that the said finding is a concurrent finding recorded by the learned trial Judge and confirmed by the Appellate Court on the basis of the evidence adduced by the parties and, therefore, the interference by this Court will be permissible only in case that finding is perverse and not based on material evidence or it has resulted in manifest injustice Mr. Rane contended that this precisely is one of such cases, for the trial and the Appellate Courts did not apply their mind to the relevant evidence, more particularly to the purported agreement of leave and license executed on April 14, 1972. Had the courts below examined the said document he urged, they would have immediately noticed that in its Clause 11, the period for which the licence has been granted has not been specified and that no schedule listing the furniture, fittings, and fixtures had been annexed to the said agreement. These circumstances taken together with the admission made by the tenant-Bharucha in the course of his evidence that the petitioner-Karkhanis was in exclusive possession of the premises, clearly establish, according to Mr. Rane, that there was a sub-lease.
5. I find no force in these submissions. The trial Court has indeed recorded its finding on the basis of the agreement itself and the relevant evidence of Bharucha and Karkhanis, that is the licensor and the licensee. This evidence discloses that Karkhanis, a Customs Officer, had been transferred to Bombay and was in search of a residential accommodation pending allotment thereof by the Government. This fact was not challenged and constitutes a strong indication that karkhanis was not seeking a permanent accommodation. This being so, the view taken by the trial court is undoubtedly on of the views possible and hence, not perverse. The Appellate Court while concurring with the reasoning of the trial Judge, further observed that in the course of the cross -examination of Mr. Karkhanis, it was not even suggested that the transaction incorporated in the agreement was not of leave and licence but was on the contrary, a transaction of tenancy. The Appellate court also remarked that the learned Advocate appearing for the landlady had stated that she did not want to proceed against the tenant-Bharucha and, therefore, his name be dropped. The said concurrent finding is thus supported by the evidence and the facts on record and I may, is entirely correct. But, even if a different view was possible, the interference by this court in exercise of its supervisory powers would not be warranted, for that would amount to exercise appellate powers. The Writ Petition No. 137 of 1987 thus fails, being accordingly liable to be dismisssed.
6. This take me to the main question raised in these petitions , viz., whether a person who occupies a premises under a licence which was subsisting as on February 1, 1973, and which was created in his favour by the tenant of such premises is protected from eviction under section 14(2) of the Act even in case the agreement of leave and licence had been entered into after eviction proceedings had been commenced against such a tenant by the landlord and which culminated in a decree for eviction.
7. It was seen that in MR. Abhyankar's view such licensee is undoubtedly protected from eviction unless a ground therefore as contemplated in sections 12 and 13 of the Act has been established against him That, according to him, is the cumulative effect of sections 15-A and 14(2) of the Act. Section 15-A indeed provides that any person who was, on February 1,1973, in occupation of any premises as a licensee, would be deemed on that date to be a tenant of the landlord in respect of the premises in his occupation. The non-obstante clause included in that provision of law coupled with its wide language makes it clear and lead to the irresistible conclusion that such licence has been created either by the landlord or by the tenant. Therefore, he urged, a licensee who was occupying the premises under a subsisting licence created either by the landlord or tenant had become, by a legal fiction, a tenant in respect of the said premises in his occupation. Sub-section (2) of section 14, in turn, postulates that where the interest of a licensor, who is a tenant of any premises, is determined for any reason, the licensee, who is deemed , by virtue of section 15-A to be a tenant shall be deemed to become a tenant of the landlord. Now the argument proceeded, after the judgment of the Supreme Court in Chandavarkar Sita Ratna Rao v. Ashalata, the distinction between a contractual tenant and statutory tenant becomes meaningless, as regards the right to create a licence, for as long as the tenancy is not completely determined, the tenant will enjoy all the rights he is entitled to, and thus the relevant question is, what is the point of time when the tenancy is completely determined ? This point of time is, the learned Counsel contended on the strength of the decisions of the Supreme court in Hiralal v. Kasturbhai, and in Chandavarkar Sita Ratna Rao v. Ashalata, the date on which the decree of eviction is passed against the tenant, and hence, it follows that a tenant against whom proceedings for eviction had been instituted is not precluded from creating, and can actually validly create a licence in favour of a person pending the said eviction proceedings. Therefore, if a licence was created by a tenant pending the eviction proceedings instituted against him and if such licence was subsisting on February 1, 1973 the licensee, who had to be deemed, under section 15-A of the Act, to be a tenant in respect of the premises in his occupation, will necessarily become a tenant of the landlord as regards the said premises on the date a decree of eviction Is passed against the tenant/licensor. Section 15-A was enacted to give protection to licensees and hence , in order to give effect to it and to prevent that the very aims of that provision be defeated, it becomes necessary to read section 15-A and section 14(2) not in isolation but together. It thus follows, Mr. Abhyankar concluded, that a decree of decree of eviction being passed against the tenant/licensor, the licensee who had become a tenant gets full protection from eviction, as the decree passed against the tenant/licensor is not binding on him. The expression "subject to the provisions of this Act" in section 14(2), however, indicates that such protection is not absolute as it is always permissible for the landlord to seek the eviction of such tenant under any of the grounds contemplated in sections 12 and 13 of the Act. This view, the learned counsel further urged, is not prejudiced by the doctrine of lis pendens incorporated in section 52 of the Transfer of Property Act, since such doctrine is attracted in the present case, because on one hand, though the petitioner Karkhanis was impleaded by an amendment in the eviction proceedings, no ground for eviction was alleged against him, and on the other, because notice of the suit was not registered as required by the Maharashtra Amendment to section 52 of the Transfer of Property Act. Reliance was placed in support of the above submissions in Anand Nivas (P) Ltd. v. Anandji, Hiralal v. Kasturbhai, and in Birdichand Hiralal v. Sadashiv,
8. While generally agreeing with Mr. Abhyankar's contentions, Mr. Rane however contended that there is a vast difference between the provisions of section 15-A and section 14(2). Section 15-A, he argued, is retrospective in operation and contemplates a licence created either by the landlord or by the tenant, establishing the relationship of landlord and tenant between the licensor and the licensee. Section 14(2) has a more restricted ambit, for it merely deals with a licence being created by the tenant. It is prospective in nature and nowhere it postulates that such licensee is protected from eviction, especially when it does not embody, unlike section 15-A, non-obstante clause. Therefore, the general law applies, according to which the landlord need not proceed against the sub-tenant and may proceed only against the tenant, the decree passed against the latter being binding on the sub-tenant Equally, in his view, the doctrine of lis pendens is very much attracted although notice of the suit was not registered. The doctrine of lis pendens being passed on the principles of justice equity and good conscience is always applicable when justice so requires, he urged placing reliance in Samarendra v. Krishna Kumar, and in Kedarnath v. Sheonarain, .
9. There is undoubtedly great merit and force in the submissions of Mr. Abhyankar. A different view would indeed defeat the very purpose of section 15-A and would have the effect of bringing back., at least partly, the very mischief which was sought to be removed by its enactment. The statement of Objects and Reasons clearly indicates that by introducing the said section 15-A the Legislature intended in its wisdom to give protection to a large section of people who occupy residential premises as licensees. I am fortified by the observations made by the Supreme court in Chandavarkar Sita Ratna Rao v. Ashalata, that....
"It appears to be clear that all licensees who were there on 1st February , 1973 were to be protected and subsequent licenses were made illegal as was done in the case of sub-tenancy from 1950."
The Supreme Court observed further that.....
"It was an attempt to protect very large number of legitimate persons in occupation and also to eliminate future mischief".
10. Section 15-A(1) provides that notwithstanding anything contained elsewhere in the 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, as 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. The amplitude of the language and the non-obstante clause unmistakenly indicate that the intendment in enacting the said provision was to give full protection to any licensee who was occupying on February 1, 1973, the premises. Indeed, the use of the expression, "any person who is on February 1, 1973 in occupation of any premises" points out that the protection was afforded to any licensee occupying the premises on that particular date, being, therefore, irrelevant whether his licensor was the landlord or the tenant; and the use of the non-obstante clause gives overriding effect to it making, therefore, full protection available. It is thus undisputable that if a tenant has created a licence in respect of the premises let out to him and if such licence was subsisting on February 1, 1973 the licensee will come within the purview of section 15-A and will be a deemed tenant of his licensor in respect of the said premises. This will be so, even in the event the licensor was not a contractual tenant but merely a statutory tenant, for as held by the supreme Court in Chandavarkar's case (supra) until a decree of eviction is passed against the tenant, a tenant protected by a stature, is entitled to create a licence which is merely a personal right and not any interest in the property. This view also gets support of Hiralal v. Kasturbhai, inasmuch as while interpreting the expression 'is determined for any reason" occurring in section 14 of the Act. The court observed that the interest of a tenant who for purposes of section 14 is a contractual tenant comes to an end completely only when he is not only no longer a contractual tenant but also when he has lost the right to remain in possession which section 2 has given to him and is no longer even a statutory tenant.
11. Section 15-A cannot however, be read in isolation in order to achieve the aims for which it was enacted. It was necessarily to be read along with section 14(2) which reads as under :
"Where the interest of a licensor, who is a tenant of any premises is determined for any reason, the licensees, who by section 15-A is deemed to be a tenant shall subject to the provisions of this act, be deemed to become the tenant of the landlord, on the terms and conditions of the agreement consistent with the provisions of this Act."
It is thus seen that sub-section (2) of section 14 contemplates the case where the licence was created by the tenant of the premises occupied by the licensee, it further flows crystal clear from it that on the interest of the tenant/licensor in the demised premises coming to an end, the licensee is automatically deemed to be a tenant of the landlord. The interest of the tenant/licensor manifestly comes to an end or is determined at the point of time when the decree of ejectment is passed, and hence, it is on the date a decree of ejectment that the licensee becomes a deemed tenant.
12. But does this cirumstance of becoming a deemed tenant protects the licensee form the eviction decree against the tenant/licensor? Mr. Rane submitted in this regard that section 14(2) has no retrospective operation, being prospective in nature. Therefore, he urged the rights the landlord had at the time of the filing of the suit for eviction are not affected by the provisions of section 14(2) with result that the decree passed against the tenant binds also his licensee, for under ordinary law, the landlord need not file a suit against the sub-tenant as the decree of eviction passed against the tenant binds also the sub-tenant.
Mr. Rane is no doubt right in that, ordinarily, the landlord need not implead a sub-tenant in a suit for eviction of the tenant and if the landlord succeeds, the sub-tenant will be removed along with the tenant unless he can take advantage of any provision of the Act. (see in this connection the observations made by the Supreme Court in Anand Niwas (P) Ltd. v. Anandji, and in Hiralal v. Kasturbhai, but, I am afraid that such foundation does not warrant his contentions. A careful examination of section 14(2) indeed shows that the rights the landlord had at the time of the filing of the suit against the tenant do not remain unchanged and, therefore, a decree of ejectment against the tenant does not also bind the sub-tenant or licensee. In fact, by providing that the licensee shall be deemed to be a tenant where the interest of the tenant/licensor is determined, the Legislature, in substance, prescribed that when the lease of the tenant comes to an end, automatically, a new lease is created in favour of the licensee occupying the premises. The expression "subject to the provisions of this Act" occurring in the said provision of law however, indicates that the creation of a fresh lease does not take place in all the cases, but only in those cases not expressly prohibited by any provision of the Act and further that the created lease will be governed by the provisions of the Act. This is, in my judgment, the correct view , taken by Mr. Rane will necessarily lead to the absurd situation of a licensee on becoming a deemed tenant by the determination of the tenant/licensor's interest will immediately cease to be a tenant, as he will be ejected from the premises along with the tenant/licensor. This manifestly was not, and could not have been the intendment of the Legislature and on the contrary, it seems that protection was sought to be given to the legitimate licensees who became deemed tenants under section 15-A of the Act.
13. Mr. Rane, however, next contended that even if protection from eviction is given to the licensees by section 14(2), such protection does not benefit all such licensees and definitely, does not cover the cases of licences created pendente lite. He argued that though section 52 of the Transfer of Property Act as amended in Maharashtra requires for its application that a notice of pendency of the suit be registered under section 18 of the Indian Registration Act, the fact remains that the doctrine of lis pendens which was evolved by the principles of justice, equity and good conscience prevails. Reliance placed in this regard in Samarendra v. Krishna Kumar, , Kedarnath v. Sheonarain, and in Anand Niwas (P) Ltd. v. Anandji, .
I am unable to persuade myself that the learned Counsel is right. No doubt, the doctrine of lis pendens was evolved by the needs of fairplay and decency. It is based on the principles of justice, equity and good conscience and was therefore, incorporated in section 52 of the Transfer of property Act. Section 52 was, however, amended in the Maharashtra State, and the registration of the notice of the pendency of the suit under section 18 of the Indian Registration Act was made a condition to attract its application. This amended section applies by virtue of section 2 of the Bombay Act, 1939 only to immovable properties wholly or partly situated at Greater Bombay. Hence, unless this condition is satisfied as regards the properties situated in the area to which section 52 is applicable, the doctrine of lis pendens will not be attracted. The decisions of the Supreme Court in Samarendra v. Krishna Kumar, and Kedarnath v. Sheonarain, are not the authorities to the propositions advanced by Mr. Rane , although in these cases the Court has applied the doctrine of lis pendens. Similarly, the majority view in Anand Niwas case is not attracted in this case where admittedly, the demised premises are situated within the area of Greater Bombay. In Anand Niwas case, the premises were situated at Ahmedabad in an area to which the amended section 52 was not applicable. I may, however, record that the majority view reflects the law as expounded above by me as well as that the minority view taken in that case by Mr. Justice Sarkar apparently gives support to the submission of Mr. Abhyankar. In fact, the learned Judge observed that the only effect of section 52 of the Transfer of Property Act is that the rights of the decree holder under the decree are not to be affected by the transfer. The rights of the landlord who gets a decree for possession against his tenant are those mentioned in Order 21. Rule 35 of the Code of Civil Procedure viz., to obtain delivery of it if necessary by removing any person bound by the decree who refuses to vacate the property. The learned Judge further observed that it is true that the sub-tenant, under the general law of the landlord and the tenant, is a person bound by the decree obtained by the landlord against the tenant for possession, though he was not made a party to the suit but where a statute like the Act 57 of 1947 gives the sub-tenants a right to continue in possession even after the determination of the tenancy of the superior tenant, he would not be a person bound by the decree, for this tenancy has not come to an end with the tenancy of the superior tenant. The decree obtained by a landlord against his tenant does not give him a right to evict a sub-tenant who is entitled to the benefit of section 14 of the Act 57 of 1947. Mutatis Mutandis , may say that where a provision like section 14(2) gives a licensee the status of a tenant on the determination of the interest of the tenant/licensor, he would not be bound by the decree for though his personal interest has come to an and, it was substituted by an interest in the property.
14. In my view, therefore, section 14(2) protects from eviction a licensee who is a deemed tenant under section 15-A even when the licence was created in his favour by a tenant against whom the eviction proceedings had already been instituted. This protection, however, is not total, for it is permissible to the landlord to file a suit for his eviction if any of the grounds contemplated in sections 12 and 13 of the Act are available.
15. Reverting now to the particular facts of the case before me, I may record that the parties are agreed in respect of some of the facts viz., that Bharucha had secured other residential accommodation in November 1967, and, therefore, had left the demised premises; that the landlady had served a notice of termination of lease on him on December 3, 1968; that she filed a suit for eviction on May 21, 1968, only against her tenant-Bharucha on the ground that he had secured other accommodation somewhere in the month of November 1967; that the agreement of leave and licence was executed in the month of April i.e. on April 14, 1972 with effect from April 16, 1972; and that the petitioner Karkhanis was jointed as a defendant in the suit by way of an amendment only on January 24, 1973. I may also note that the Court below arrived at a concurrent finding that the petitioner Karkhanis was on Feb. 1, 1973 occupying the premises as a licensee under a subsisting licence created in his favour by the tenant-Bharuch and that as such he has acquired rights of a deemed tenant in view of section 15-A of the Act. This finding cannot be interfered with as supported by the evidence on record. Mr. Rane, however, challenged its correctness by drawing my attention to the Clause 11 of the agreement where the duration of the licence was not specified and had been kept blank, and by further submitting that this circumstance is most relevant, as by itself, vitiates the findings of both the courts below that there existed a substantial licence as on February 1, 1973. The learned Counsel would have been right in his submission if the evidence was restricted to that agreement only. That however is not the case as both the licensor-Bharucha and licensee-Karkhanis gave evidence and not only satisfactorily explained why the clause respecting the duration of the licence was not filled but also stated that their understanding was that the licence was his principle for 11 month as Karkhanis expected to get Government accommodation allotted to him within a period of about six months. The finding, was therefore, arrived at, considering the agreement and all the attendant circumstances, and is entirely correct.
16. Considering this factual background and that in his view there was no sub-lease as alleged by the plaintiff-landlady, the learned trial Judge, while decreeing the suit on the ground that Bharucha has obtained other residential accommodation, dismissed it against the petitioner Karkhanis holding that he has become a deemed tenant under section 15-A of the Act. The Appellate Court however, while fully agreeing with the finding of the fact recorded by the trial Court, took the view that whatever right, title or interest had been accused to the tenant-Bharucha under section 15-A, his licensee Karkhanis was subject to the provisions of the Act under section 14(2) as against the tenant and was thus subject to the rights of the landlord. Accordingly, the Appellate Court held that the creation of subsequent lease could not have prejudicially affected the rights already accrued by the landlord to evict the tenant. The Appellate Court, therefore, decreed the suit against the petitioner Karkhanis also.
In my judgment, the view taken by the Appellate Court is erroneous since the expression "subject to the provisions of this Act" occurring in section 14(2) does not manifestly have the import given to it by the learned Judges of the Appellate Bench, for such construction would practically nullify the creation of the lease in favour of the licensee. As already seen, it means on one hand, that such leases will be governed by the provisions of the Act, and on the other, that the same leases will be created automatically unless such creation is evaluative of any express provision of the Act. The impugned judgment of the Appellate Court is, therefore, liable to be set aside in as much as the suit was decreed against the petitioner-Karkhanis also.
17. In the result, the rule is made absolute in terms of prayer (a) in W.P. No. 57223 of 1986, and is discharged in W.P. No. 137 of 1987.
18. There will be no order as to costs, in the circumstances of the case.