Calcutta High Court (Appellete Side)
Duncan International (Ind) Limited And ... vs Anglo India Jute Mills C. Limited And ... on 29 April, 2014
Author: Arijit Banerjee
Bench: Ashim Kumar Banerjee, Arijit Banerjee
Form No. J.(2)
IN THE HIGH COURT AT CALCUTTA
Civil Appellate Jurisdiction
Appellate Side
Present :
The Hon'ble Mr. Justice Ashim Kumar Banerjee
and
The Hon'ble Mr. Justice Arijit Banerjee
F.A. No. 30 of 2009
With
F.A. No. 31 of 2009
Duncan International (Ind) Limited and others
-Versus-
Anglo India Jute Mills C. Limited and another
For the Appellants : Mr. Joydeep Kar,
Mr. Reetabrata Mitra,
Ms. Micky Chowdhury,
Mr. Jayanta Sengupta,
Mr. S.N. Pyne,
For the Respondents : Mr. Sabyasachi Chowdhury,
Mr. Abhijit Guha Roy,
Mr. Syed E Huda,
Heard on : April 12, 16, 17, 21, 2014
Judgment on : April 29, 2014
ASHIM KUMAR BANERJEE.J:
F.A. 30 and 31 of 2009 are two appeals arising out of the
common judgment and decree passed in an eviction
proceeding. The facts would reveal, Anglo India Jute Mills
Company Limited was the owner of flat No. 34 at Woodland
Estate, premises No. 8/7 Alipore Road Calcutta. The premises
were comprised of a total area of about 190 square feet. At one
point of time, Duncan International India Limited and Anglo
India Jute Mills Company Limited were under the same
management of one Goenka family. Duncans were using the
flat belonging to Anglo India where one of their officers was
residing. The facts would depict, Anglo India became sick and
was referred to the Board of Industrial and Financial
Reconstruction (herein after referred to as BIFR). We would
not go in detail as to the BIFR proceeding. Ultimately, as per
the sanctioned scheme the present management of Anglo India
took over charge of the company and demanded vacant
possession of the flat in question that Duncans denied.
Initially Duncans took the plea, they were having a claim
against Anglo India in repayment of such loan. Duncans were
adjusting the rent payable in respect of the flat as a tenant.
Duncans would claim, they were inducted as a tenant with
effect from April 1, 1991 at a monthly rental of Rs. 10000.
Duncans paid and/or adjusted the rent for the period April 19,
1991 to December 1994. Subsequently, they tendered rent
and ultimately started depositing rent in Court at the said
rate. Anglo India totally denied the landlord-tenant
relationship. According to them, once Anglo India came out of
the fold of Goenkas they were not entitled to retain possession
that would amount to tress-pass. Duncans filed a suit being
Title Suit No. 5 of 1996 inter-alia, claiming a declaration, they
were tenant in respect of flat and prayed for consequential
injunction restraining Anglo India from disturbing their
possession. Anglo India filed a suit being Title Suit No. 53 of
2001 inter-alia, claiming recovery of possession as well as
mesne profit. Learned Judge heard both the suits analogously
and dismissed the suit of Duncans and decreed the suit of
Anglo India and asked the Duncans to deliver up vacant
possession.
Being aggrieved, the Duncans preferred both the appeals, one
against the dismissal of their suit and the other against the
decree for recovery of possession. The Division Bench vide
judgment and Order dated January 15, 2009 asked the
appellant to pay occupation charges at the rate of Rs.65000
for the period February 1994 till July 1998 and thereafter at
the rate of Rs.1.3 lacs till the disposal of the appeal. The
appellant did not comply with the said direction that resulted
in vacating of the order of stay. Anglo India got the decree
executed and obtained possession by dispossessing Duncans.
The present appeal would thus effectively deal with the
question of mesne profit.
RIVAL CONTENTIONS:
Mr. Joydeep Kar learned Counsel appearing for the appellants
would attack the judgment and decree impugned on two fold
grounds:
i) In absence of a notice under Section 106 of the Transfer
of Property Act or any appropriate notice under the West
Bengal Premises Tenancy Act, the suit for eviction was not
maintainable hence, the decree was liable to be set aside.
ii) The learned Judge, while deciding the issue, relied on the
finding of the Court made by his predecessor under Section
17(2) of the Premises Tenancy Act that would make the decree
null and void.
To support his contention, Mr. Kar would rely upon four
decisions of this Court:
1. Badrilal Vs. Municipal Corporation of Indore reported
in All India Reporter 1973 Supreme Court Page-508.
2. East India Hotels Limited Vs. Syndicate Bank reported
in 1992 supplementary Volume-II Supreme Court Cases
Page-29.
3. Kayamuddin Shamsuddin Khan Vs. Stat Bank of India
reported in Volume-VIII Supreme Court Cases Page-676.
4. Dwarka Nath Pyne Vs. Abhijit Sanyan & Another
reported in 2008 Volume-IV Calcutta Law Times Page-206.
Mr. Kar would also rely upon the order of the Apex Court
appearing in the supplementary paper book that dismissed the
Special Leave Petition of Anglo India as against the judgment
and order of the Delhi High Court in the BIFR proceeding.
Pertinent to mention, the Delhi High Court Division Bench
order also dealt with the issue of subject tenancy.
Mr. Kar would place his plaint particularly, paragraph 9, 10,
12 and 17 to support his contention. He would also rely upon
the documents tendered in evidence on behalf of Duncans.
According to him, the tenancy was not in dispute in the BIFR
proceeding hence, the suit filed by Anglo India making a plea
of trespass would not be tenable and the eviction decree in
absence of a notice under Section 106, would be liable to be
set aside.
Per contra, Mr. Sabyasachi Chowdhury learned Counsel would
also rely upon the relevant discussion in the matter of the
Delhi High Court. He would refer to internal page-8 of the said
decision. The relevant paragraph relied upon by Mr.
Chowdhury is quoted below:
"Claim of the petitioner Company that the flat is tenanted to it
by respondent No. 7 is sham and fictitious in as much as there
is no lease agreement and no Board Resolution of respondent
No.7 authorising anyone to create tenancy: tenancy plea is
malafide and is an abuse of process of law as tenancy is
claimed by erstwhile promoter of respondent No.7 in addition to
respondents Nos. 8 and 9, who also own 83.68 shareholding in
the petitioner Company: no rent was paid from April, 1991 to
March, 1992."
Elaborating his submission, Mr. Chowdhury would contend,
the documentary evidence tendered during trial would relate
to, at best, post-suit documents showing tender of rent and
deposit thereof. Those documents would have no effect on the
issue. He was also critical about the date of deposit. According
to him, the Duncans claimed, they adjusted rent up to 1994
however, one year rent was sent for the first time by letter
dated July 18, 1996 that would ex facie demonstrate the
falsity of claim. Moreover, the creation of tenancy was never
backed up by any Board resolution. The so-called adjustment
did not have any contemporaneous record. According to him,
initially, the reference before BIFR was made in 1987. The
draft scheme was prepared in 1989 hence, the so-called
creation of tenancy in 1991, keeping the BIFR in the dark, was
not permissible at all. He would also complain, the resident
Association would demand monthly maintenance charges that
Duncans never paid, Anglo India was and still is paying
maintenance charges, presently at the rate of 7000 per month.
Resuming his submission on the next day, mr. chowdhury
would try to confront the submission of Mr. Kar on Section
17(2) findings. According to him, the documents relied upon
by Duncans before the learned Judge in Section 17(2)
proceeding was again used during final trial. No new
document was tendered hence, the learned Judge, although a
different person, come to the same conclusion. Mr. Chowdhury
would rely upon two passages, one from Halsbury and the
other from Byles on Bills of Exchange. The relevant portion is
quoted below:
"As rent constitutes a debt of equal degree with a specialty
debt, it is not discharged by the landlord's act in accepting a bill
of exchange or promissory note; such a bill or note is a
conditional payment only, that is, it does not operate as
satisfaction until it is paid, in the absence of specific agreement
to the contrary."
"A plea of payment of a bill should be supported by proof of
payment in money, and not merely by proof of a satisfaction of
it by an agreement. If payment otherwise than in money is
alleged, it must be proved that the party to whom such payment
was made elected to treat a payment in that form as equivalent
to a payment in money. Thus if bonds are accepted in payment,
the payment is good though they prove to be valueless. A
cheque is normally conditional payment, the debt reviving on tis
dishonour."
Mr. Chowdhury further confronted Mr. Kar's contention to the
effect, tenancy was not in dispute in the proceeding.
According to him, the dispute was already raised
contemporaneously that would be apparent from the Balance
Sheet. Mr. Chowdhury would refer to Sections 18(8) and 22 of
the Sick Industrial Companies (Special Provisions) Act 1985
(hereafter referred to as SICA). Section 18(8) would provide as
and when the sanctioned scheme would come in operation the
same would be binding on the sick industrial company and/
or the Transferee Company, as the case may be, including the
other company, shareholder, creditors, guarantors, employees
and all concerned. Section 22 would suspend all contracts
during the period when the scheme was in operation that
would be de hors the scheme. Relying on these two
provisions, Mr. Chowdhury would contend, the scheme was in
operation in 1989. In 1991, the tenancy was alleged to have
been created that would be de hors the sanctioned scheme
prevalent at the relevant time. He would lastly rely upon the
decision of this Court in the case of Mather and Platt (India)
Limited Vs. J. Thomas and Company Private Limited
reported in 2000 volume 1 Calcutta Law Times Page 268 to
support his proposition, mere payment of rent would not
create any landlord tenant relation. Paragraphs 14 and 23
were relied upon in this regard.
Per contra, Mr. Joydeep Kar, learned Counsel while giving
reply would distinguish Section18 (8) of SICA to contend the
subject property was not a part of the said scheme. Hence,
the same would not have any effect on the issue in this regard.
He would rely upon the Delhi High Court judgment in the
B.I.F.R. Proceeding in this regard. According to him, similar
analogy would apply in case of applicability of Section 22. He
would contend, Section 18 (8) came in force in February 1,
1994 and as such even if the property was a part of the first
scheme, the said provision would not apply.
Resuming his argument on the next day Mr. Kar would
suggest, neither of the pleadings would indicate, the first
scheme included the subject property. The respondent never
argued the same at any stage. Distinguishing the passage
cited by Mr. Chowdhury from Halsbury and Byles, Mr. Kar
would submit, the banker's cheques were as good as cash.
The banker's cheques were duly tendered that the respondent
accepted and never returned. It was their wish either to
encash or not to encash the same. The appellant had nothing
to do with the same. He would further contend, the T.D.S.
certificates were duly received by the respondent. If those were
utilized, that would itself establish the landlord tenant
relationship. The tenancy was created in 1991, the then
landlord did not raise any objection whatsoever, Exhibit 4 was
a rent receipt for 1992 that the respondent never challenged
that would establish the relationship. The respondent never
made out any case of fraud, there was no transfer of tenancy
hence, the decision in the case of Mather and Platt (India)
Limited Vs. J. Thomas and Company Private Limited
reported in 2000 volume 1 Calcutta Law Times Page 268
would have no application. He would pray for setting aside of
the decree passed by the learned Judge of the Court below.
OUR VIEW:
We have considered the rival contentions. For creation of
landlord-tenant relation the parties intending to take benefit of
relationship must prove the same.
In the case of Badrilal vs. Municipal Corporation (supra) the
Apex Court observed, a person who is lawfully in occupation of
the premises would not become trespasser and he would not
become a tenant holding over, he would be a tenant in
suffering.
In the case of Dwarka Nath Pyne (Supra), the learned Single
Judge of this Court held, in order to determine the amount of
rent payable by the tenant along with arrears, the Court would
need to come to a prima facie finding on the existence of
landlord-tenant relationship and not a definite and final
finding. Learned Judge observed so while dealing with the
proceeding under Section 17(2) of the West Bengal Premises
Tenancy Act.
Another learned single Judge of this Court held the similar
view in the case of Mather and Platt (India) Limited (Supra).
His Lordship held, under section 17(2) it is the duty of the
Court to determine the amount of rent payable by the tenant.
The tentative finding of the Court regarding the landlord
tenant relationship was the elementary basis to proceed
further in determination of rent.
If we analyze the evidence, we would find, prior to filing of the
suit by Duncans no document could be brought in evidence
establishing the tenancy. According to Duncans, the tenancy
was created in 1991, they were adjusting loan against their
liability to pay rent. Not a single contemporaneous document
could be produced to support such claim. The property would
admittedly belong to the sick industrial company. Hence, the
scheme of 1989 would definitely have some say. At that time,
Goenkas were in common management of both the companies.
They were occupying the flat in question, once the company
changed hands in 1993 the Goenkas should have handed over
the property back to the company owning the same. They did
not do so. It is not correct to say, Anglo India did not object or
that they admitted the tenancy. The records would reveal
other wise that would support the stand of Anglo India. Delhi
High Court considered the BIFR direction with regard to
tenancy, they were of the view, BIFR stepped out while giving
such direction and as such set aside the same that would not
take away the right of the company to avail due process of law
that they did subsequently. The dismissal of the Special Leave
Petition at the instance of Anglo India would have no
consequence on the lawful proceeding initiated by Anglo India.
The suit filed by Duncans was prior in time. Learned Judge
heard both the suits analogously. If we take Duncans' suit
first for consideration, we would find no evidence to support
their claim for tenancy. Hence, their defence in the eviction
suit on non-service of notice under Section 106 of Transfer of
Property Act would not sustain. Once Duncans failed to
establish the tenancy and Anglo India could prove the
ownership, the decree of eviction was the obvious
consequence. We do not find any scope to interfere.
RESULT:
Appeal fails and is hereby dismissed. There would be no order
as to costs. The parties would have liberty to proceed
accordingly for determination of mesne profit.
Arijit Banerjee, J. :
I agree.
[ASHIM KUMAR BANERJEE,J.] [ARIJIT BANERJEE,J.]