Delhi District Court
M/S A.B. Lal & Sons vs . M/S Texind Corporation P. Ltd. on 7 February, 2008
M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd.
IN THE COURT OF SHRI M.C.GARG, ARCT, DELHI
NO. 210/07
1. M/s A.B. Lal & Sons
Through its Karta Sh. Gopal Krishan
S/o late Sh. A.B. Lal
R/o 608, Doctors Lane, Gole Market,
New Delhi-110001.
2. Sh. Gopal Krishan
S/o Late Sh. A.B. Lal
R/o 608, Doctors Lane, Gole Market,
New Delhi-110001. ....Appellants
Versus
1. M/s Texind Corporation P. Ltd.
Kermani Building,
Sir P.M. Road, Fort, Mumbai,
Through its Managing Director,
Sh. Ashutosh Munshaw
2. M/s Virshti Overseas (P) Ltd.
First Floor, 6, Doctors Lane,
Gole Market, New Delhi-110001.
(Service to be effected through
Managing Director Mr. Mukesh Seth)
3. Sh. Mukesh Seth
S/o Sh. O.P. Seth
First Floor, 6, Doctors Lane,
Gole market, New Delhi-110001. .....Respondents
1
M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd.
Date of Institution : 20.11.2007
Judgment Reserved: 1.2.2008
Date of Judgment:7.2.2008
ORDER
1. This Civil Appeal arises out of the Judgment/order dt.
24.10.2007 whereby the eviction petition bearing no. 1143/06 titled as M/s A.B. Lal & Sons Vs. Texind Corporation P. Ltd. has been dismissed by the Addl. Rent Controller in respect of allegations made by the appellant u/s 14(1)(b)(d) and (h) of Delhi Rent Control Act in respect of suit premises as shown red in the site plan annexed with the plaint in the trial court. It is the case of the appellants that an eviction petition was filed by the first appellant mainly u/s 14 (1)(b) of Delhi Rent Control Act against the respondents on the allegations that the suit property was let out to the first respondent for residence cum personal office of the employees of the first respondent. The suit property which was let out comprised of three bedrooms with two attached bathroom, one drawing cum dining hall, one kitchen and open terrace on the 2 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd. second floor as shown in red colour in the site plan. The property was lastly occupied by third respondent who at the relevant time . 3 was working as Branch manager of the first respondent. However, it was averred in the eviction petition that the first respondent closed down its business due to continuous losses and almost all the employees left the job including respondent no. 3. Thus third respondent also ceased to be the employee of the first respondent yet third respondent along with the family members members also formulated a company in the name and style of second respondent having its registered office at the address of the tenanted premises. It was thus submitted that in this manner first respondent sublet, assigned or otherwise parted with the possession of the whole of the tenanted premises in favour of second and third respondent without the written consent of the appellant. It has been alleged that respondent no. 2 & 3 are in complete possession of the tenanted premises to the exclusion of first respondent since the month of December 2000. During the course of pendency of this 3 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd. petition Sh. Gopal Krishan Mathur who had thrown the suit property in the common hotch potch while constituted M/s A.B. Lal & Sons was also impleaded as one of the eviction petitioner and therefore is also one of the appellant in this case.
2. Respondents filed joint written statement under the signature of the third respondent even though no document to show the authorization of the third respondent to sign the written statement on behalf of the first respondent was placed on record. In the written statement it was alleged that the present petition filed by Sh. Gopal Krishan Mathur was not maintainable. On merits while it was not denied that premises was let out to the first respondent for residence and also for office purposes but it was denied that the first respondent was no more in physical, actual and legal possession of the tenanted premises. Allegations of sub- letting were denied. It was also stated that grounds u/s 14 (1)(d) and (h) of Delhi Rent Control Act were not available as the premises was let out for commercial purposes. The allegations of 4 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd. subletting were specifically denied.
3. In the replication it was reiterated by the appellant that the petition as filed was maintainable in as much as Sh. A.B. Lal who originally let out the suit premises to the first respondent; subsequently constituted an HUF under the name and style of M/s AB Lal & Sons HUF by throwing the suit property in the common hotch potch. It was also alleged that Sh. G.K. Mathur was karta of HUF after the death of Late Sh. A.B. Lal and therefore competent to file the suit.
4. In support of their case, appellant examined three witnesses including AW1 Sh. G.K. Mathur who filed his affidavit Ex.A 1 which was in the lines with the averments made in the eviction petition. He has also proved the site plan as Ex.PW1/1, rent agreement as Ex.PW1/2 and the letters between the parties as Ex.PW1/3 to 7. Certified copy of the Registrar of Companies has been proved as Ex.PW1/8 and the statement of account of the petitioner as Ex.PW1/9. PW 2 G.L. Katyal has proved the certified 5 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd. copies of the Article of Association of Vrishti Impacts P. Ltd. list of Directors and certificate of incorporation as Ex.PW1/8 and statement of account Ex.PW1/9. PW 3 Sh. Naval Kishore proved on record form 18 submitted by Vrishti Impex P. Ltd. regarding change of address as Ex.PW3/1.
5. As per the respondents are concerned, only third respondent appeared and examined himself as RW 1.
6. By the impugned order the Addl. Rent Controller while holding that their exist relationship of landlord and tenant between the appellants and the first respondent dismissed the eviction petition on the ground that the appellant/petitioners failed to prove that the suit premises has been sublet, assigned or parted with the possession by the first respondent in favour of respondent no. 2 &
3. In this regard, the trial court further held that no evidence was led by the appellant to the effect that the third respondent ceased to be an employee of the first respondent and they also failed to prove that the first respondent has wound up their business from 6 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd. the said property or that it had become non-operational due to losses suffered by it. The trial court further observed that merely because the third respondent floated a company in the name of the third respondent. It can not be presumed that the suit premises was sublet assigned or otherwise parted with the possession of the first respondent in favour of the second and third respondent.
7. This order has been assailed by the appellants on various grounds. It has been submitted that the order dismissing the eviction petition by the appellants is based upon conjectures and surmises. It has been specifically stated that the Addl. Rent Controller has erred in Law in not considering that what the landlord was required to prove in respect of allegations u/s 14 (1)
(b) of the Delhi Rent Control Act was only the presence of third party which fact stood proved from the statement of PW 1, PW 2 and PW 3. Once it was so the onus to justify the presence of third party was on the tenant. However, the tenant has not even dared to appear in the witness box. RW 3 it is stated is not authorized 7 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd. representative and therefore it is submitted that the Judgment of the trial court is contrary to legal possession. In this regard is thus erroneous.
8. It is also stated that the order delivered by Addl. Rent Controller that private limited company is not a legal entity is an error in Law.
9. I have heard submissions from the site of the appellant as well as from the side of the respondent.
10. At the outset I may observe that Ld. Counsel for the appellant has assailed the Judgment only on the point of subletting and has not pressed his appeal on other grounds. Relying upon Judgments of Hon'ble Supreme Court in case Bharat Sales Ltd. Vs. LIC of India reported in 1998 RLR (SC) 192 and the judgments of Delhi High court in the case of Gill & Company Ltd. and another Vs. Smt. B.K. Jolly reported in 1986 (2) All India Rent Control Journal 579 and in case of Rup Chand Vs. Ms. Shanti Devi reported in 1987 (2) AIR 305, it has been submitted 8 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd. that these Judgments clearly support the plea of the appellant when third parties are admitted in possession of the suit property. Onus to justify the presence shifts upon tenant yet the trial court has just ignored these Judgments and thus committed an error in Law for the simple reason that there is no evidence has been led on behalf of the respondents to prove that respondent no. 2 is associate company of the first respondent or that the third respondent still continues to be am employee of the first respondent. On the other hand, Ld. Counsel for the respondent who also filed an application subsequent to the hearing of arguments submitted that the present appeal was mis-conceived as no question of law has been framed in this appeal.
11. The submissions made by Ld. Counsel for the respondent are mis-conceived for the simple reason that the entire appeal proceeds on the basis that the approach taken by Ld. Trial court was illegal and the appreciation of the evidence by him was erroneous. In the ground of appeal, appellants have further 9 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd. submitted that the conclusions drawn by the trial court that the onus to prove business of the first respondent stood would up or that the third respondent was not in the employment of the first respondent was mis-placed and mis-conceived.
12. Having gone through the record of this case and having given my thoughtful considerations, I am of the considered view that one specific allegation was made by the appellants that since 2000 the business of the first respondent stood wound up and all the employees of the first respondent left their services it was incumbent upon the first respondent to have lead evidence on record to prove that the third respondent was still in the employment and that the second respondent was allowed to have its registered office there is mere use without any exclusive right to occupy the suit property. However, in the present case not even a single document has come on record which may establish that even the written statement filed by the respondent i.e., respondent no. 1 was signed by duly authorized person in as much as not even 10 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd. a single document has been placed by third respondent on record to justify signing of the written statement on behalf of respondent no. 1. It is a matter of record that no authorized person on behalf of the first respondent has come in the witness box.
13. It would also be appropriate to take note of the cross- examination of the third respondent who appeared as RW 1 where he has stated as under:-
" There are three bed rooms, one drawing room, one kitchen, two toilets, small store and terrace accompanied by toilet in occupation of respondent no. 1 on first floor. I applied for registration of respondent no. 2 to the office of Registrar of Companies with address of 6, Doctors Lane. My father was also a Director in the said company. I am also one of the Directors of respondent no.
2. The other Directors are Swaran Lata Khurana. At present there are only two Directors as my father has expired" .
14. This statement of the third respondent goes to show that the first respondent had nothing to do with the second respondent yet the second respondent shows its registered office in the suit property. No document which may go to show that the first 11 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd. respondent had any concern with the second respondent has been placed on record. It would also be appropriate to take not of further cross-examination of this witness.
" I did not take any permission from petitioner for using the address of suit premises for registration of respondent no. 2 nor has respondent no. 1 taken that permission" .
The witness further stated:
" It is correct that I have been carrying on business in the name and style of respondent no. 2 which has now been changed Vrishti Impex P. Ltd. the name was changed about 2 years ago. It is incorrect to suggest that I am not working for respondent no. 1 for last 4-5 years. I am not maintaining any account of respondent no. 2.
The witness further stated:
" Respondent no. 1 has an account with Bank of Baroda, Connaught Circus Branch, Delhi. I have not brought the accounts of respondent no. 2 but I can produce the same" .
Witness further stated:-12
M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd.
" Respondent no. 1 is carrying on business of Textiles Machinery marketing through me. The volume of such business is 60-70 lacs rupees per year. I have not brought the record today but I can produce the same. It is incorrect to suggest that respondent no. 1 is not having any business in Delhi for the last 405 years. I have not brought any record of change of address of respondent no. 2 but I can produce the same" .
The witness further stated:
" I have not brought any record of salary being received by me from respondent no. 1. Vol. I am not paid a consolidated salary but I am paid on commission basis for each machinery installed through me. I was being paid salary when I initially joined respondent no. 1 in the year 1987" .
15. The aforesaid cross-examination categorically establishes that third respondent allowed the second respondent to occupy the suit premises without the consent of even the first respondent. The third respondent worked for the first respondent on the salary basis only up to year 2000 and therefore he was not even a salaried employee even it was stated that first respondent was carrying on 13 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd. his business from the suit premises yet no document to show that the business was being run by the first respondent from the suit property after the year 2000 has been placed on record. Even the record of payment of salary by the first respondent to the third respondent is also not coming forward. In these circumstances, it is apparent that even though presence of second and third respondent stands established but no evidence has been lead by the first respondent to justify the presence as an employee of the first respondent. Similarly, there is no evidence led by first respondent that they are carrying on business in the suit property even now or that the third respondent is a employee.
16. Having gone through the order passed by the trial court, Judgment can not be sustained as it is illegal and has interpreted evidence erroneously and has also placed onus on the appellant to prove that the first respondent was not carrying on his 14 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd. business from the suit property or that the third respondent was not their employee.
17. The trial court has also very conveniently ignored the Judgment cited at the bar from the side of the appellant which are available on the record.
18. In the case of Bharat Sales Vs. LIC of India as reported in 1998 RLR (SC) 192, the Hon'ble Supreme Court was pleased to hold:
" Sub-tenancy or subletting comes into existence when the tenant gives up possession of the tenanted accommodation, wholly or in part and puts another person in exclusive possession thereof. This arrangement comes about obviously under a mutual agreement or understanding between the tenant and the person to whom the possession is so delivered. In this process, the landlord is kept out of the scene. Rather, the scene is enacted behind the back of the landlord, concealing the overacts and transferring profession clandestinely to a person who is an utter stranger to the landlord in the sense that the landlord had not let out the premises to that person nor had he allowed or consented to his entering into 15 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd.
possession over the demised property. It is the actual physical and exclusive possession of that person, instead of the tenant, which ultimately reveals to the landlord that person, to whom the property was let out has put some other person into possession of that property. In such a situation it would be difficult for the landlord to prove, by direct evidence, the contract or agreement or understanding between the tenant and the sub-tenant, it would also be difficult for the landlord to prove, by direct evidence that the person to whom the property had been sublet had paid monetary consideration to the tenant. Payment of rent undoubtedly, is an essential element of lease or sub-lease. It may be paid in cash or in kind or may have been paid or promised to be paid. It may have been paid in lump-sum in advance covering the period for which the premises is let out or it may have been paid or promised to be paid periodically. Since payment of rent or monetary consideration may have been made secretly, the law does not require such payment to be proved by affirmative evidence and the Court is permitted to draw its own inference upon the facts of the case proved at the trial including the delivery of exclusive possession to infer that the premises were sublet.
19. Similarly, the law of subletting has also been discussed in 16 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd. the case Gill & company Pvt. Ltd. and another Vs. Smt. Bimla Kumari Jolly reported in 1986 (2) 579 where also a similar proposition was laid down even prior to the Judgment delivered in the case Bharat Sales with the following words:-
" the law is well settled that a person who is let into exclusive possession is prma facie to be considered to be a tenant, Nevertheless he will not be held to be so if the circumstances negative any intention to create a tenancy. Words alone may not suffice. Parties can not turn a tenancy into a licence merely by calling it one. But if the circumstances and the conduct of the parties show that all that was intended was that the occupier should be granted a personal privilege, with no interest in the land, he will be held to be a licensee only (Per Lord Justice Denning in Erringtom Vs. Erringtom and Woods, . It is equally well settled that the initial burden lies on the landlord to establish that any of the conditions mentioned in clauses (a) to (1) of the proviso to Section 14 (1) exists. The power of the Controller to pass an order for recovery of possession of the premises under Clause (b) depends upon the fact whether the premises in question have been sub-let, assigned or otherwise parted with possession thereof. Since the factum of appellant no. 2 being in exclusive 17 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd.
possession of the premises in question subsequent to the termination of his service is not in dispute,it will prima facie warrant an inference that there has eben a transfer of possession. Hence, the onus willshif on the appellants within whose special knowledge the facts explaining the manner in which such possession has been transferred and they have to discharge the burden of proving such facts which would negative the assumption of sub-letting, assignment or parting with possession of the premises in question.
20. In the light of the aforesaid Judgments it is clear that the onus to show that the third respondent was still an employee of the first respondent or that possession of the second respondent was permissive possession only, was upon the first respondent but the said onus has not been discharged by them and therefore their presence in the suit property would hold that their were unauthorized subletting.
21. The Judgment delivered in the case of Jagan Nath Vs. Chander Bhan on which reliance has been placed by the trial court in dismissing the eviction petition are not at all applicable to 18 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd. the facts in dispute. Hence, I set aside the Judgment of the trial court and pass and an eviction order in favour of the appellant u/s 14 (1)(b) of the Delhi Rent Control Act in respect of suit property bearing no. First floor, 6, Doctors Lane, Gole Market, New Delhi-01 as shown red in the site plan with no order as to the cost. Copy of the order be sent to the trial court along with trial court record. Appeal file be consigned to the record-room.
(M.C.GARG) Addl. Rent Controller Tribunal, DELHI.
Dated: 7.2.2008 19 M/s A.B. Lal & Sons Vs. M/s Texind Corporation P. Ltd.
8.2.2008 Present: None.
After arguments were heard, an application was filed by the respondent u/s 38 of the Delhi Rent Control Act by stating that in the present case no question of Law had been framed by the appellant. However for the detailed reasons given in the order, I hold that the application filed by the respondent was mis-conceived. Hence, while allowing the appeal of the appellant vide separate order passed today, the application u/s 38 moved by the respondent is dismissed with no orders as to the cost. Copy of the order be sent tot he trial court along with trial court record. Appeal file be consigned to the record-room.
(M.C.GARG) Addl. Rent Controller Tribunal, DELHI.
Dated: 7.2.2008 20