Delhi District Court
M/S. Northern India Iron & Stell Co. Ltd vs M/S. New India Motors(New Delhi) Pvt. ... on 31 March, 2015
IN THE COURT OF SH. PRASHANT SHARMA, ADMINISTRATIVE CIVIL JUDGE, NEW DELHI DISTRICT, PATIALA HOUSE COURTS, NEW DELHI. E No. 7/11 M/s. Northern India Iron & Stell Co. Ltd. ... Petitioner A company incorporated under the provisions of the Companies Act, 1956, having its registered office at: 118, Ansal Bhawan, 16, Kasturba Gandhi Marg, New Delhi110001. Versus M/s. New India Motors(New Delhi) Pvt. Ltd, ... Respondent Through its Principal Officer/Director, A company incorporated under the provisions of the Companies Act, 1956 having its registered office at: 10B, Scindia House, Connaught Place, New Delhi110001. PETITION UNDER SECTION 14(1)(e) R/W. SECTION 25B OF DELHI RENT CONTROL ACT, 1958. Date of institution of the petition : 11.05.2011 Date on which order was reserved : 23.03.2015 Date of pronouncement of order : 31.03.2015 E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 1 Judgement referred: 1) Satyawati Sharma(dead) by LRs Vs. Union of India & Anr. decided on 16.04.2008 in Civil Appeal No. 1897 of 2003. 2) S.P. Chengalvaraya Naidu VS. Jagannath & Ors, cited as AIR 1994 SC 853. 3) Satnam Kaur & Ors. Vs. M/s. Ashlar Stores Pvt. Ltd JUDGEMENT
1. M/s. Northern India Iron & Steel Company Limited(hereinafter company) has filed present eviction petition based on its bonafide requirement, pertaining to premises viz. one hall i.e. a showroom situated at ground floor, premises bearing no. 10B, Scindia House, Connaught Place, New Delhi bearing Municipal No. 13(hereinafter premises in question). Initially it was filed by the company against M/s. New India Motors(New Delhi) Pvt. Ltd, M/s. Trans Tours & Travels Pvt. Ltd(hereinafter respondent no. 2), M/s. Bel Air Travel & Cargo Pvt. Ltd(hereinafter respondent no. 3) and M/s. East West Agencies(hereinafter respondent no. 4). During course of proceedings, company withdrew its claim against respondent no. 2 to 4, by making statement through its counsel on 23.08.2011. The net result is this eviction petition was only contested by New India Motors(New Delhi) Pvt. Ltd(hereinafter respondent).
2. Company requires premises in question in the background of following facts, asserted by it in the eviction petition.
Company had purchased the premises in question from its erstwhile owner vide registered sale deed dated 30.06.1986. At that time respondent was already occupying E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 2 the premises in question, as it was inducted as tenant by the erstwhile owners of premises in question. After purchasing the premises in question respondent attorned to company as its landlord. Company, also started making payment of house tax and is continuing to do so till date. Business of company is pertaining to manufacturing and dealing in steel and steel derived and related articles. Company is duly empower to do such other business as are beneficial for company, in addition to aforesaid purposes. Company is a duly incorporated as per the provisions of Indian Companies Act 1956 and is running its business from 1960, from various rented offices. Over the period due to heavy losses it has not been in a position to conduct its business profitably, for the last many years. The said losses in profits, is precisely due to lack of suitable accommodation on one hand which is available with the company and on other hand, high rentals have to be paid by the company for occupying the space. Company is keen to run its business profitably by wiping out its losses, which is its suffering due to lack of suitable space. As on date it is unable to run its business. Premises in question are suitable for the company as trading and other activities can be run efficiently from the said premises. Company has no other accommodation for commencing its business activities and for setting up its business premises in question is best suited. E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 3 Earlier company was carrying out its activities pertaining to manufacturing of steel items and related products from its factory situated at Faridabad, but due to heavy losses, company was forced to shut it down. Eventually said factory was sold in the year 19992000. Aforesaid bonafide need of company, gets support from the fact that respondent is not doing any business from premises in question. As such respondent does not require the said premises, which respondent has already illegally subletted to M/s. Trans Tours & Travels Pvt. Ltd, M/s. Bel Air Travel & Cargo Pvt.
Ltd and M/s. East West Agencies. Further M/s. Trans Tours & Travels Pvt. Ltd, M/s. Bel Air Travel & Cargo Pvt. Ltd and M/s. East West Agencies are unauthorizely occupying, premises in question for their financial gains. In fact respondent is receiving sum of Rs. 3000/ per month from M/s. Bel Air Travel & Cargo Pvt. Ltd. Apart from that respondent is also receiving substantial consideration amount from M/s. Trans Tours & Travels Pvt. Ltd and M/s. Bel Air Travel & Cargo Pvt. Ltd, towards the rental of premises in question. Apart from that respondent has accumulated losses over past year and as per the balance sheet year 20052006 accumulated losses of respondent are to the tune of Rs.
488761/. Further paid up capital of respondent is only Rs. 312000/ which is less than the accumulated losses of E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 4 respondent. Respondent has no fixed assets except for some old furniture and old typewriter which for combined worth of Rs. 600/ as per the balance sheet of respondent. Therefore the liabilities of respondent exceeds its assets and in such situation respondent is not able to run its business from the premises in question. Respondent is holding the premises in question for extraneous consideration and for realizing huge pugree from the company. That respondent prior to the formation of the present company was running a company in the name of M/s. New India Motors Pvt. Ltd. That the main person behind the both companies was Late Sh. K.C. Jain.
That said earlier company was declared bankrupt and was voluntarily would up by the management with a view to swallow public money. That after winding up of the earlier company, respondent was formed by Sh. K.C. Jain(since deceased) along with one of his sons in order to avoid making payment of the debts of the earlier company. That respondent is heading in the same direction and is merely seeking to hold over the demised premises owing to its market value and strategic location and to realize huge pugree. That respondent is not entitled to the protection offered by Delhi Rent Control Act, 1958 and is liable to be evicted from the demised premises.
E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 5
3. Respondent in its written statement challenged the alleged bonafide need for petitioner company on following grounds:
(a)That present eviction petitionis not maintainable in present form as it should have been filed U/s 22 DRC Act.
(b)That petitioner company has various vacant properties where in petitioner company can run its business those properties are mentioned below:
(b1)Office Apt. No. 118, Ansals Bhawan, K. G. Marg, New Delhi - 110001.
(b2)Office Apt. No. 118, Ansals Bhawan, K. G. Marg, New Delhi - 110001.
(B3)Office Apt. No. 202/3, Ansals Bhawan, K. G. Marg, New Delhi - 110001.
(B4)Office Apt. No. 411, Ansals Bhawan, K. G. Marg, New Delhi - 110001.
(B5)Office Apt. No. 608, Ansals Bhawan, K. G. Marg, New Delhi - 110001.
(B6)Office Apt. No. 803, Ansals Bhawan, K. G. Marg, New Delhi - 110001.
(B7)ShopcumShowroom GF4, Ansals Bhawan, K. G. Marg, New Delhi - 110001.
(B8)ShopcumShowroom Ground Floor, N4, Connaught Place, New Delhi110001.
(c)Property in question is not suitable for manufacturing for E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 6 steel & related articles which constitutes the bonafide need of petitioner company.
(d)That petitioner company has siphoned off the sale proceeds of its factory at Faridabad and is falsely claiming that the said factory had gone in losses as a result it was sold by petitioner company.
4. Besides aforesaid aspects, respondent claimed that petitioner has malafidely filed present eviction petition as earlier eviction petition, filed by erstwhile owner premises in question namely M/s Khushwant Singh and M/s Gurbax Singh was dismissed by the then Rent Tribunal in RCA No. 220/1976 vide its order dated 04.08.1979. No construction in the premises in question, at any point of time was carried out by respondent as erstwhile landlord vide its letter dated 09.07.1973 had allowed respondent to carry out renovation in the premises in question. Respondent no. 2 and 3 were permitted to occupy premises in questoin through written consent by original landlord. So far as respondent no. 4 is concerned, it has no right, title or interest in the premises in question, as per agreement dated 11.07.1973. Infact petitioner is well aware about the aforesaid agreement dated 11.07.1973, which was signed by grand father of Sh. Chetan Gupta namely Sh. Charan Das and witnessed by his son Late Sh. Ram Lal(father of Chetan Gupta). Sh. Ram Lal was the manufacturing partner of respondent no. 4 and is also Chairman of petitioner company. Mrs. Shashi Aggarwal daughter of Late Sh. Charan Das and son of Late Sh. Ram Lal was a partner of respondent no. 4 from 11.07.1973 onwards when that agreement was signed. Mrs. Shashi Aggarwal is also Director in petitioner company E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 7 since 19.03.1982. Respondent no. 4 was a general Sales Agency in Air France in 1973 having its registered office in Roxy Hotel, Jalandhar City, Punjab and require the service of Sales Promoter. Therefore Respondent no. 4 appointed respondent as their sub agent on the basis of 0.75% commission on total turnover. Respondent is in travel business since 28.07.1972 operating under the name and style of Trans Travels. Therefore Respondent no. 4 approached respondent to promote travel business at Delhi as respondent has its office at delhi. Further RL Group is owned by Sh. Chetan Gupta and his family. Smt. Vandana Gupta, Smt. Charu Gupta, Sh. P. Chetan Gupta, Smt. Shashi Aggarwal and Sh.Vijay Gupta are holding maturity shares in petitioner company. Smt. Charu Gupta and his family members are also claimed the partners of the respondent no. 4. As petitioner filed present petition after 21 years of passing of order dated 04.08.1979 despite knowing the aforesaid facts it all shows that petitioner has malafidely moved this court. Respondent pointed out that an Appeal against the order and decree dated 26.09.2008 passed by court of Sh. A. K. Garg, Ld. ADJ, Delhi. 4.1. Respondent also replied that petitioner has not disclosed complete and true facts to the court as their existed only structure in the premises in question which was raised, only on the directions of Hon'ble Supreme Court passed on 24.09.1984 in Appeal No. 3866/19841 regarding which a sum of Rs. 3000/ is also received by respondent no. 4 for harassing respondent, petitioner has also disconnect the water supply coming to the premises in question.
4.2. Respondent challenged the authority of Sh. U. N. Gupta to file present petition on behalf of petitioner company.
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5. On the basis of aforesaid version, respondent challenged the case of petitioner company.
6. Petitioner in response to aforesaid version filed its replication in which it refuted the version of respondent and reiterated its own version as mentioned in the petition. Besides that it replied that respondent by not filing any documents pertaining to the verious properties referred by it has raised a false and baseless plea. Further in the background of facts and circumstances of the present case there is no need for invoking lifting of corporate veil against the petitioner company. Infact respondent company as on date is not carrying out any business activity from premises in question rather is occupying the same, for releasing rent from its occupiers. Respondent company, does not own any valuable assest in premises in question and is running in losses for more than a decade. Respondent company has various others property from where it can run its business and therefore it does not require the premises in question. Petitioner asserted that respondent cannot dictate it as to how and what fashion business has to be run by petitioner company. It challegend the allegation of siphoning off proceedes of sale of faridabad factory of petitioner. Petitioner asserted that respondent has no business to challenge the said factum of sale of factory of petitioner at Faridabad.
7. So far as applicability of Section 21 DRC Act is concerned petitioner replied that said act in which additional ground for evicting tenant has prescribed by law to the company. In this regard it referred to two judgements namely Satnam Kaur E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 9 Vs Ashlay Stoo 2009 (158) DLT 62 and M/s Madan Mohan Lal Shri Ram Pvt. Ltd Vs Sh. P. Tandon 1987(1) All India Rent Control General.
8. Petitioner explained the status of various properties referred by respondent. Property Office Apt. No. 118, Ansals Bhawan, K. G. Marg, New Delhi - 110001 is owned by Smt. Vandana Gupta and corporate office of R L Group is situated in said premises, ShopcumShowroom GF4, Ansals Bhawan, K. G. Marg, New Delhi - 110001 and ShopcumShowroom Ground Floor, N4, Connaught Place, New Delhi110001 are owned by Sh. Rajiv Jain and his family members, Office Apt. No. 118, Ansals Bhawan, K. G. Marg, New Delhi - 110001 is a rented premises where R L Travels Pvt. Ltd., Sphinx Travels are carrying out their business, Office Apt. No. 803, Ansals Bhawan, K. G. Marg, New Delhi - 110001 is premises where business of R L Travels Pvt.Ltd. is bieng run, in Office Apt. No. 202/3, Ansals Bhawan, K. G. Marg, New Delhi - 110001 and Office Apt. No. 608, Ansals Bhawan, K. G. Marg, New Delhi - 110001 are the premises where in business of Indo Arab Air Services is being carried out, in Office Apt. No. 411, Ansals Bhawan, K. G. Marg, New Delhi - 110001 business of R L Travels being run . In all the aforesaid business concerned in addition to Sh. Chetan Gupta his wife Smt. Vandana Gupta one Smt. Jagwati has also shares. Rental amount paid for this premises ranges between 100 Sq.ft. To 150 Sq.ft.. Aforesaid concerned are paying exhorbitant rent. Comparison to the same respondent is paying rent which worked out to less than 25 paisa per Sq.ft.. Petitioner replied that respondent has not specified as to which property of petitioner is lying vacant where in it carried outits business. On the contrary father of Pawan S. Jain was carrying in to the business under the name and style of New India Motors Ltd. and the said company E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 10 has goneint o liquidation therefore on one hand petitioner has ni space for running its business and on the other hand respondent company is not doing any business from the premises in question, hence petitioner requires the premises in question.
9. After completion of pleadings matter was fixed for Petitioner's evidence.
10. Petitioner examined three witness to prove its case. PW1 Sh. V. M. Gupta deposed in his evidence by way of affidavit Ex.P1, facts, already mentioned by me in my preceding paragraphs as those mentioned in the petition. Same are not repeated here for the sake of brevity. He also placed on record copy of Board Resolution ExPW1/1, Site Plan of demised premises Ex.PW1/2, Certificate of incorporation, Memo of association and articles of association of petitioner company all referred as Ex.PW1/3 (colly), balance sheets of petitioner company Ex.PW1/4, and Ex.PW1/5. PW2 Sh. Rakesh Sangar deposed in his evidence by way of affidavit Ex.PW2/A that properties viz. 803, Ansals Bhawan, K.G. Marg, New Delhi110001, 202, Ansals Bhawan, K.G. Marg, New Delhi110001, 203, Ansals Bhawan, K.G. Marg, New Delhi110001, 608, Ansals Bhawan, K.G. Marg, New Delhi110001, 411, Ansals Bhawan, K.G. Marg, New Delhi110001 and 103, Ansals Bhawan, K.G. Marg, New Delhi110001 are rented out to various tenants as mentioned in his affidavit. He further placed on record lease deed of properties except property bearing no. 103, Ansal Bhawan, K. G. Marg, New Delhi, which are referred as PW2/6 to PW2/10 Property bearing no. GF 4, Ansal Bhawan, K. G. Marg, New Delhi is under the ownership of Sh. Rajiv Jain and his family members. So far as property bearing no. N4, Janpath, Connaught Place, New Delhi is concerned petitioner company is neither E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 11 in possession nor does it own the said property. Further none of the properties referred by respondent as mentioned above are additional accommodation for petitioner company as neither petitioner nor its sister concerns are onus or are in possession of the said properties. He placed on record copy of Board Resolution Ex.PW2/1, his Special Power of Attorneys Ex. PW2/2 to Ex.PW2/5. PW3 Ms. Sonia Jain, UDC, SubregistrarVII, INA, Vikas Sadan, New Delhi being a summoned witness testified in her testimony after comparing documents with original records that Ex.PW2/8 and Ex.PW2/9 and Ex.PW2/10 are copies of original documents. Subsequently petitioner evidence was closed.
11. Respondent examined only one witness to prove its version. RW1 Sh. Pawan S. Jain in his evidence by way of affidavit Ex.RW1/A Sh. Pawan S. Jain reiterated the version of respondent as mentioned in its written statement as mentioned above and not repeated here for the sake of brevity. He placed on record true copy of order dated 04.08.1979 passed in RCA No. 220/1970 Ex.RW1/1, true copy of eviction petition bearing EP No. 74/2001, Ex.RW1/2, true copy of written statement filed by respondent Ex.RW1/3 in the said case, true copy of order passedin RFA No. 319/08 and 320/08 Ex.RW1/4. After conclusion of respondent's evidence, matter was fixed for final arguments.
12. Subsequently, final arguments were heard and matter was fixed for judgment.
E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 12
13. Before appreciating evidence on record, I must mention here, the relevant provision, under which present petition was preferred by the petitioner, which is Section 14 (1) (e) DRC Act. Section 14(1)(e) of the Act enables a landlord to file a suit for eviction on the ground that the premises let out for residential purpose are required bonafidely by him for occupation as a residence for himself or for any member of his family dependent on him, if he is the owner thereof or for any person for whose benefits premises are held and that the landlord or such person has no other reasonable suitable residential accommodation. For obtaining an order of eviction under this clause a landlord has to plead and prove the following ingredients:
a) That he is owner / landlord of the suit premises.
b) That the premises were let out for residential purposes.
c) That he requires the premises for himself or for any member of his family dependent upon him.
d) That he has no other reasonable suitable residential accommodation.
14. In the wake of Satyawati Sharma(dead) by LRs Vs. Union of India & Anr. decided on 16.04.2008 in Civil Appeal No. 1897 of 2003, a landlord, can now file eviction petition under aforesaid provision for obtaining premises, meant for commercial usage.
15. Coming back to the facts of the preset case, I find that respondent has not disputed the ownership of petitioner. Rate of rent, which is Rs.554.74/, payable per month, is also not disputed, which shows that this petition is not barred under Section 3 (c) DRC Act. Property in question, is located within territorial jurisdiction E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 13 of this court. In the light of Satyawati Sharma(dead) by LRs Vs. Union of India & Anr. decided on 16.04.2008 in Civil Appeal No. 1897 of 2003, petitioner has the right to file present petition, based on its bonafide need, pertaining to property, meant for commercial use. As such, present petition is maintainable, when viewed from aforesaid aspects.
16. Apart from that, petitioner has also alleged in its petition that respondent has subletted / parted with the possession of property in question and has also made unauthorized construction in the said property. Said averments made by the petitioner, constitute separate grounds for eviction, but petitioner has not substantiated the said grounds, through evidence. Therefore, I am not appreciating the said grounds of eviction, in this order.
17. Respondent has precisouly challenged the bonafide need of petitioner by questioning the 'bonafide' of petitioner and also by claiming that petitioner is in possession of various properties, owned by petitioner and its directors, as mentioned above. I will be appreciating the said contentions of the respondent, in the background of evidence, placed on record, in subsequent paragraphs. Bonafide Need of Petitioner.
18. Petitioner, admittedly a company, requires the property in question, as for last few years, it is not able to conduct its business profitably, which is preciously due to lack of suitable accommodation and also for the reason that it has to shell out high rent amount to the landlord, for the space occupied by it. As per petitioner, E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 14 property in question is highly suitable for conducting its business for which petitioner has no other suitable space. PW1 Sh. V. M. Gupta, General Manager of petitioner company, on the strength of board resolution Ex.PW1/1 has deposed the said facts in his testimony. Authority of this witness, on the basis of Ex.PW1/1, to depose on behalf of petitioner company is not challenged by the respondent, as document Ex.PW1/1 is not objected by the respondent. As such, his testimony, cannot be thrown over board, for want of his authority to depose on behalf of petitioner company.
19. PW1 Sh. V. M. Gupta, in his testimony placed on record site plan Ex.PW1/2, Certificate of Incorporation, Memorandum of Association and Article of Association Ex.PW1/3 (collectively). Said documents are also not disputed by respondent. Therefore, site plan filed by petitioner through this witness is proper and there is no issue with regard to the incorporation and objectives of petitioner company, as mentioned in Ex.PW1/3 (collectively).
20. Balance Sheets and Auditor's reports, Ex.PW1/4 and Ex.PW1/5, are also not disputed by respondent. Ex.PW1/4 is the Auditor's report accompanied with profit and loss statement for the year ended on 31.03.2013. In the said statement, under the row with heading 'Revenue from Operation' and 'expenses', it is clear that there was nil amount from the operation activities during 2013. However, the petitioner company has reported profits, after taking extraordinary income into the account. Therefore, as such no manufacturing activities were undertaken by petitioner company, during the said period. Respondent, as such has not raised the E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 15 plea that petitioner company is running its business for all practical purposes. Therefore, the only conclusion, which can be drawn, from the said reports, is that petitioner company is not running its business, which corroborates the version of PW1, as deposed by him in his affidavit. This conclusion, rules out the possibility that petitioner company requires the property in question, just for the sake of it, though it is running its business smoothly. In the background of aforesaid appreciation, I find that PW1 Sh. V. M. Gupta, was able to prove the fact that petitioner company is suffering losses and is not doing any business, for the last few years.
21. The net result is, as such, I do not find any ill motive behind filing of present petition, by petitioner company as it is not able to run its business, profitably, for the last few years.
Influence of Chetan Gupta and his family members on petitioner company.
22. Much stress, has been laid by the respondent, on the aspect that Chetan Gupta and his family members, have significant influence on the petitioner company and that they are the persons, who are managing R.L. Group of Companies, which include R.L. Travels Pvt. Ltd., Sphinx Travels and R.L. Exports International. On the face of it, this argument, in no way, solely, affects the case of petitioner company, as record reveals that petitioner company is an independent company, having no link with R.L. Group of Companies. Respondent, though, has disputed the said fact, but his version is negated by PW1 Sh. V.M. Gupta on one hand and on other hand respondent, was not able to bring on record any proof, in support of his version. Even if, it is believed E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 16 that Chetan Gupta and his family members, have significant influence in petitioner company, then also requirement of property in question, by petitioner company, for running its business, does not go haywire. Petitioner company, being a separate legal entity, requires property in question, for running its business which is a separate aspect in comparison to the manner in which it is being run by its directors. Respondent nowhere developed its argument, as to how significant influence of Chetan Gupta and his family members, creats doubts over the bonafide need of petitioner company. Further, a person can be a director, in as many companies, as he likes. There is no bar, as such against such person. If Chetan Gupta and his family members are having shares in petitioner company, then the said aspect, by itself, does not creat any doubt over the bonafide of petitioner company. Other spaces available to petitioner company.
23. Respondent, in its written statement has only pointed out that property viz Office Apt. No. 118, Ansals Bhawan, K. G. Marg, New Delhi - 110001, Office Apt. No. 118, Ansals Bhawan, K. G. Marg, New Delhi - 110001, Office Apt. No. 202/3, Ansals Bhawan, K. G. Marg, New Delhi - 110001, Office Apt. No. 411, Ansals Bhawan, K. G. Marg, New Delhi - 110001, Office Apt. No. 608, Ansals Bhawan, K. G. Marg, New Delhi - 110001, Office Apt. No. 803, Ansals Bhawan, K. G. Marg, New Delhi - 110001, ShopcumShowroom GF4, Ansals Bhawan, K. G. Marg, New Delhi - 110001 and ShopcumShowroom Ground Floor, N4, Connaught Place, New Delhi110001 are owned by petitioner company and its directors, which are available to petitioner company. Onus of proving the said fact rested on the respondent. RW1 Sh. Pawan S. Jain, who was the sole witness examined by respondent, did not place on E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 17 record any proof whatsoever, in support of the said contention. On the contrary, he failed to divulge, clear and crisp information pertaining to the source, from where, he had obtained the information of availability of aforesaid spaces, with petitioner company. He testified that he had gathered information from various guards and neighbours, regarding ownership of aforesaid office spaces. He failed to name the said guards and neighbours. In fact, he admitted, that he had not checked government records regarding the status of aforesaid office spaces. The net result is, availability of aforesaid office spaces, with petitioner company, remained bald plea on the part of the respondent, which was never substantiated and/or proved by resondent. Per contra, petitioner, examined PW2 Sh. Rakesh Sangar who being authorized person of M/s. R.L. Travels Pvt. Ltd., M/s. R.L. Travels, M/s. Indo Arab Air Services, M/s. All India Travel Services and M/s. Sphinx Travels, on the basis of Ex.PW2/1 to Ex.PW2/5 respectively, deposed that aforesaid office spaces situated at Ansal Bhawan, K.G. Marg, New Delhi, are rented accommodations in which aforesaid companies are tenants. Respondent did not challenge the aforesaid authorities of this witness, given by aforesaid companies, which proved that not only this witness was duly authorized rather the authorization based resolution, was executed by legal entities, including companies and partnership firms. Though, this witness was suggested that aforesaid office spaces were available with petitioner but this witness refuted the same. As such, this witness did not succumb to the acid test of cross examiation, by conceding that aforesaid office spaces, were infact were available to petitioner company. The lease deeds Ex.PW2/6 to Ex.PW2/10 were objected to by the respondent, on the mode of proof. Originals of the said lease deeds were never placed on record and therefore, said objection is sustained. I am not considering the said documents, for appreciating E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 18 the evidence on record. But non reading of said lease deeds, do not affect the aforesaid conclusion regarding existence of companies / partnerships, who are doing their business from aforementioned spaces. This conclusion, therefore, dismantles the case of respondent, regarding availability of vacant spaces with petitioner company. Overall, testimony of PW2, Sh. Rakesh Sangar was relevant as it negated the possibility of vacant spaces with petitioner company. His testimony, held its ground with regard to the said aspect and I believed him.
24. Further, while cross examining PW1, respondent asked him as to whether petitioner company has paid any rent or user charges to Vandana Gupta. It was also asked as to whether any landlord has given any notice of vacation to the R.L. Group of Companies, mentioned above. Said questions, clearly indicate that respondent admitted that as on date petitioner company is being run from a rented accommodation which corroborates the case of petitioner company as it requires premises in question for running its business. Apart from that second limb of question, indicated that respondent admits that rest of the office spaces are occupied by R.L. Group of Companies, on rent, which in a way, give force to the deposition of PW2 Rakesh Sangar, that lease deeds Ex.PW2/6 to Ex.PW2/10, were executed by the concerned Landlord with various concerns of R.L. Group of Companies. Once it is admitted that concerns of R.L. Group of companies are occupying aforesaid offices on rent, then obvious corollary is that they are running their business from the said offices and therefore it cannot be believed that the said spaces are vacant. E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 19 Business of respondent.
25. Petitioner, categorically has alleged in its petition that respondent is not doing any business from the property in question. As an outsider, petitioner could have deposed to that extent only. Being internal matter, onus of rebutting the said version, rested heavily on respondent. Respondent should have filed proofs regarding business activities being done by it from the property in question. Respondent failed to do so. RW1 Sh. Pawan S. Jain, though had deposed in his testimony that respondent company had made substantial turnover during the period from 2000 till 2007, but failed to place on record any proof in support of the same. He also did not place on record any document showing that the authorized capital of respondent company was Rs. 10 Lacs/, at its inception. Apart from that, he failed to remember, as to what income tax respondent company had paid during 2000 till 2007. Therefore non filing of any document and want of knowledge, pertaining to income tax and authorized capital on the part of RW1 Pawan S. Jain, weakened the case of respondent, as aforesaid aspects were not proved by respondent, which should have been proved by respondent. Overall, I found, that respondent company is not doing any business from the property in question. This conclusion, indicates that respondent company is keeping the possession of property in question, just for the sake of it, without requiring it. In such situation, where on one hand petitioner company is able to show its bonafide need and respondent failed to show that it is doing its business from premises in question, case of petitioner company stands proved.
26. Respondent, per contra, has argued certain aspects, besides those, appreciated above, which I am appreciating in my subsequent paragraphs. E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 20 Improper verification of contents of affidavit.
27. Respondent argued that testimony of PW1 V.M. Gupta is illegal as only first two paragraphs of his affidavit, were verified, in the verification of the said affidavit. Said argument is not tenable, for the reason that respondent never raised the said argument, during course of trial. It seems to be an afterthought. Respondent never objected to the contents of affidavit of PW1 V.M. Gupta, when they were tendered in evidence. In fact, respondent cross examined PW1 V.M. Gupta, with respect to facts mentioned in his affidavit, subsequent to verified first two paragraphs. Veracity of PW1 V.M. Gupta was challenged with respect to all the facts, including unverified facts also. Therefore, shortcoming in the verification of affidavit of PW1 V.M. Gupta, was cured by the cross examination, done by respondent. No evidence of losses in, any trading business of petitioner company, filed.
28. Respondent argued that petitioner never placed on record any document, to show that its factory at Faridabad was closed down due to heavy losses. Only strength of this argument, veracity of PW1 Sh. V.M. Gupta was challenged. I do not find the said argument plausible as I have already concluded in my preceding paragraphs that petitioner company is not doing any manufacturing activities for last few years based on the auditor reports. That conclusion, is sufficient to uphold the bonafide of petitioner company. Proofs of losses at Faridabad factory, belonging to petitioner, losses its significance, accordingly. Even otherwise, aforesaid objection, could not have been raised by respondent as RW1 Pawan S. Jain, had no clue about the address of said factory of petitioner. When a person does not know the address of E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 21 a factory and has no knowledge about the fate of the said factory, based on records, then his version, cannot be upheld against the version of a party who is able to show bonafide in moving the Court. Accordingly, in the present case also plea of respondent regarding requirement of placing on record proofs of losses, sustained by petitioner at its Faridabad factory, has no signicance. More so, where respondent failed to show that the said factory at Faridabad is being properly run, as on date or that it was closed down due to any reason, apart from the reason given by petitioner company.
No proposal or scheme placed on record by petitioner company in furtherence of its intention.
29. Respondent argued that petitioner company never placed on record any proof with regard to its intention of running its business from premises in question. Said argument is of no help to the respondent, as it is not mandatory for a landlord to place on record details of business activity, which he/she wants to initiate in demised premises. In the case in hand, once petitioner gets the premises in question, it is at liberty to run its business, as per its objectives. Even otherwise, rights of respondent are saved U/s. 19 of DRC Act.
Want of knowledge of PW2 Rakesh Kumar Sangar.
30. Respondent argued that PW2 Rakesh Kumar Sangar had no knowledge about the ground of eviction and the business of petitioner company. Said want of knowledge, on his part, did not create doubt in his testimony, as this witness was able to prove, unavailability of office spaces, pointed by respondent. Besides that, he was E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 22 not expected to know the details of this case. So, his testimony cannot be doubted. Filing of memorandum and articles of association along with resolution copy subsequent to grant of leave to defend.
31. Respondent argued that aforesaid documents were filed by petitioner, only when their non filing was pointed out by Court, while appreciating application for leave to defend and therefore said subsequent filing, seems to be an afterthought, based on dishonest intention. I differed from the said arguments, for the reason that yardstick which has to be appreciated, at the time of grant of leave to defend, to a tenant, is different from the yardstick, which has to borne in mind, by the Court, while deciding the matter, after conclusion of full fledged trial. Simply because certain documents are filed by petitioner, after grant of leave to defend, does not show malafide on the part of petitioner. More so when they were filed with the permission of the Court.
Alteration of memorandum of Association.
32. Respondent argued that initially memorandum of association was not filed by petitioner company, as the activity of "trading" was not authorized/permitted under the memorandum of association(inshort 'MOA'). The said MOA, was filed along with resolution subsequently, to cover up said lacuna, which petitioner company could have done by followig relevant provisions of Companies Act. Therefore legality of memorandum of assocition, was challenged. Said argument again has not significance, as it was never put to any the petitioner witnesses for checking its veracity. The MOA, placed on record, was never objected to by the respondent and E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 23 therefore respondent lost the right to challenge the said document. Absence of best evidence.
33. As per respondent, testimoney of Chetan Gupta, who is managing director of petitioner company, was of great significance. This person was never examined by petitioner company so as per respondent, non examination of this person indicated that petitioner company never tried to confront Chetan Gupta with the true state of affairs, in tune with the version of respondent.. Therefore non examination of Chetan Gupta on the part of petitioner company weakened their case. I do not find said argument tenable, as petitioner company is a seperate legal entity. Who has to be examined and who is not supposed to be examined, is the prerogative of petitioner company. Respondent has not right to meddle with the same. Testimony of Chetan Gupta would have been relevant, had respondent thrashed the testimony of authorized person of petitioner company, which was never done. Therefore absence of testimony of Chetan Gupta, did not create any difference.
Eviction petition is mere pretence and petitioner in fact by its conduct in the manner of instituting the petition, itself demonstrate the malafides.
34. Respondent argued that the eviction petition was initially filed against the tenant and the alleged subtenants were also arrayed as respondent no. 2 and 4. That it is pertinent to mention here that M/s. East West Agencies, one such alleged subtenant, was arrayed as respondent no. 4. That the prayer clause of the eviction petition also claimed that an order of eviction be passed directing the subtenants, that is, erstwhile respondent no. 2 to 4 to vacate the premises. That it has come on record E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 24 that the managing director of the petitioner company is also the managing partner of the said respondent no. 4 and he has signed the vakalatnama on behalf of Respondent no. 4 before this Hon'ble court and the same also stands admitted in the cross examination of PW1. That the Vakalatnama is Ex.EZ. That the nefarious design was that the respondent no. 4 shall despite service not file its leave to defend and thus an order of eviction shall be claimed under section 25B of the DRC Act, which also is reflected from the order sheet dated 16.07.2011 of this Hon'ble Court. That it is only when the Answering respondent brought this mischief to the notice of this Hon'ble Court that the petitioner sought to delete the subtenants from the array of parties. That it is also a matter of record that the counsel for the previous respondent no. 4 is also now appearing for the petitioner. That this clearly demonstrates that since there is no such requirement, the entire claim is based on falsehood and the attempt is to mislead this Hon'ble court thus a fraud was sought to be played. That such litigants are to be discouraged and as held by the Hon'ble Supreme Court in S.P. Chengalvaraya Naidu VS. Jagannath & Ors, cited as AIR 1994 SC 853, the eviction petition is liable to be dismissed. I do not find the said arguments tenable as fact of the matter remains that respondent no. 2 to 4, though were arrayed as respondents initially, were deleted by the court at the request of petitioner. What was borne in mind by the petitioner while praying for the deletion, was never asked by respondent, to its witnesses, during trial and there is as such no proof, with regard to the conclusion, drawn by respondent, on its own whims. Therefore respondent cannot be given any benefit for the said arguments.
E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 25 Dismissal of earlier eviction petition and filing of present petition after Satyawati Sharma(dead) by LRs Vs. Union of India & Anr. decided on 16.04.2008 in Civil Appeal No. 1897 of 2003.
35. As per respondent, earlier eviction petition filed by erstwhile owners U/s. 14(1)(b) DRC Act, was dismissed by the concerned Courts as per Ex.RW1/1 but despite knowing the same, petitioner has filed another eviction petition bearing No. EP74/01, which is pending adjudication and has filed present petition after Satyawati Sharma(dead) by LRs Vs. Union of India & Anr. decided on 16.04.2008 in Civil Appeal No. 1897 of 2003. So despite knowing that earlier petition U/s. 14(1)(b) DRC Act was dismissed, petitioner has filed EP74/01, indicates its malafide. Further filing of present petition after Satyawati Sharma(dead) by LRs Vs. Union of India & Anr. decided on 16.04.2008 in Civil Appeal No. 1897 of 2003, only shows that petitioner wants to take benefit of the said case. Both the said arguments are baseless as petition bearing No. EP74/01 is pending adjudication and no observation/order can be made in this petition, with respect to the said petition. So far as timing of filing of present petition is concerned, it is a toothless argument, as if it is to be upheld, then it will mean that all the landlords, who have filed or are filing eviction petition U/s. 14(1)(e) DRC Act, just want to take benefit of Satyawati Sharma(dead) by LRs Vs. Union of India & Anr. decided on 16.04.2008 in Civil Appeal No. 1897 of 2003. Said conclusion cannot be drawn legally.
Petition not maintainable as it is not filed U/s. 22 of DRC Act.
36. Respondent argued that present petition is not maintainable, as it is not filed U/s. 22 DRC Act, which precisely deals with the petitions, where landlord is E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 26 company. Said argument is not tenable as Hon'ble Delhi High Court in Satnam Kaur & Ors. Vs. M/s. Ashlar Stores Pvt. Ltd 2009(1) RCR 576, has held that Section 22 DRC Act is additional remedy and petition U/s. 14(1)(e) DRC Act is maintainable. Further section 22 DRC Act, does over ride section 14(1)(e) DRC Act, in specific cases only where company requries the demised premises for use by their employees. In the case in hand, company wants to run its business and does not require the premises for its employees. Trial has been completed and throughout trial, respondent never raised this objection. Respondent failed to point out, as to what prejudice has been caused to it, if instead of section 22 DRC Act, procedure of section 14(1)(e) DRC Act is followed. Respondent failed to explain as to how in the given facts and circumstances of this case only section 22 DRC Act is applicable and not section 14(1)(e) DRC Act.
37. The net result is that petitioner proved its case of bonafide requirement. Its witnesses held their ground during cross examination. Besides PW1 and PW2, PW3 remained a formal witness, who testified in her testimony that the lease deeds referred by her, were registered in records. Respondent, failed to create doubt in the version of petitioner and also failed to prove his its own case.
38. Respondent relied upon certain case laws to support its version. Said case laws are distinguishable on facts and therefore are not relevant, as mentioned below;
E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 27
39. In Satpal Vs. Sahi Ram MANU/DE/2098/2011, individual person required the shop for running his business for supporting his family members. In the case in hand, unlike said case, company requires premises for running business with profit, which it is not able to do for last many years.
40. In Quasim Vs. Manohar Lal Sharma & Ors., Shiv Sarup Gupta Vs. Dr. Mahesh Chand Gupta 1999(6) SCC 222 and Sri Kempaiah Vs. Lingaiah and Ors. 2001 (8) SCC 718, individuals required property for running their business unlike present case where company require the demised premises.
40. In A.K.K. Nambiar Vs. UOI AIR 1970 SC 652, fact in issue, was related to service matter. Law relating to provisions of All India Service(Appeal & Discipline) Rules 1955, were mooted unlike present case wherein DRC Act is to appreciated.
41. In Autocop (India) Pvt. Ltd. Vs. S. Savinay Impex Pvt Ltd. MANU/DE/4190/2006, it was a civil suit where Court had held that directors should continue to be made as defendants in the said case, by lifting the corporate veil, which is not the case in the present petition.
42. In Dr. A Lakshmanaswami Mudaliar and Ors. Vs. LIC of India and Ors. AIR 1963 SC 1185, issue was based on contract law i.e. whether Directors were personaly liable to pay the due amount to company, which is not the case, in the given facts and circumstances.
43. In Escorts Limited Vs. Sai Autos and Ors. MANU/DE/0305, issue was pertaining to recovery of amount and not eviction of tenant. E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 28
44. In Shri Lal Chand Vs. Shri Gopi Kishan & Ors. All India Rent Control Journal, 1978 (1) 389, fact in issue was based on interpretation of section14(1)(b) of DRC Act and not that of bonafide requirement.
45. In M/s. Madan Mohan Lal Sri Ram Pvt. Ltd. Vs. Shri P. Tandon All India Rent Control Journal, 982 (1) 381, petitioner company required the premises for residence of his employees, which is not the case in the present petitoin.
46. In Vishwanath Vs. Chaman Lal Khanna AIR 1975 (DEL) 117, it was the meaning of "company", which was mooted. Even otherwise, that case was based on interpretation of section 14(1)(b)DRC Act.
47. In Sri K.A. Padmanabhan Ex.MLA MANU/0541/1991, interpretation of section 340 Cr.P.C, was observed by the Court, which is not the issue in present petition.
48. Kisan Lal Manik Lal Rathi Vs. Dinakar Yashwant Patil MANU/MH/0711/2003, was a suit for recovery of possession and not eviction petition.
49. Rajender Perashad Vs. Darshana Devi AIR 2001 SC 3207, matter was pertaining to dishonour of cheque.
E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 29
50. In S.V.R. Mudaliar(dead) by LRs & Ors. Vs. Rajabu F. Buhari(Mrs.)(dead) by LRs & Ors AIR 1995 SC 1607, issue was pertaining to specific performance for reconveyance of the property sold by the plaintiff, which is not the case in hand.
51. Before coming to conclusion, I must observe that record of this case shows that respondent is simply holding he premises, just for the sake of it. Respondent is not doing any business from the premises in question. There is no record, which shows that respondent is doing any business from the premises in question. Such conduct of respondent speaks volumes about the malafide of respondent who wants premises in question for some ulterior motives. Said aspect of this case, in a way indicated that as such no prejudice will be caused to the respondent if it is directed to be evicted out of the premises in question. This is also one of the reason, which was borne in mind, while coming to the conclusion.
52. In the background of aforesaid appreciation of evidence and record placed before me, I find that petitioner company has proved its case. Present eviction petition stands allowed. Respondent is given six months time to vacate the premises in question.
52. File be consigned to record room after necessary compliance.
Announced in open Court (PRASHANT SHARMA)
on 31st March 2015 ARC/ACJ/CCJ: New Delhi
Patiala House Courts/31.03.2015
E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 30
E. NO. 07/11
31.03.2015
Present: Sh. J.P. Gupta counsel for petitioner.
Ms. Priyanka and Ms. Bhumika, Proxy counsels for respondent. As per order dated 08.08.2014, passed by Hon'ble Delhi High Court, it was directed that this case be decided within 9 months from that day. Said order is complied with as vide my judgement of even date, Present eviction petition stands allowed. Respondent is given six months time to vacate the premises in question.
File be consigned to record room after necessary compliance.
(PRASHANT SHARMA) ARC/ACJ/CCJ: New Delhi Patiala House Courts/31.03.2015 E No. 7/11 M/s. Northern India Co. Vs. M/s. New India Motors Ltd. Page no. 31