Madhya Pradesh High Court
Vimal Chand Jain vs M.P.Khadi Sanstha Sangh on 25 February, 2022
Author: Sanjay Dwivedi
Bench: Sanjay Dwivedi
1
HIGH COURT OF MADHYA PRADESH AT JABALPUR
BEFORE
HON'BLE SHRI JUSTICE SANJAY DWIVEDI
FIRST APPEAL NO. 51 OF 2007
1. Vimal Chand Jain
(dead),through L.Rs.
1. Smt. Sugandhi Jain,
aged 60 years, widow of
late Shri Vimal Chand
Jain.
2. Vineet Jain, aged 38
years, son of late Shri
Vimal Chand Jain.
3. Sachin Jain, aged 34
years, son of late Shri
Vimal Chand Jain.
No.1 to 3 are residents
of 91-Malviya Nagar,
Bhopal (MP).
4. Pratibha Jain, aged
39 years, daughter of
Late Shri Vimal Chand
Jain, resident of
Vidisha (MP).
5. Priti Jain, aged about
43 years, daughter of
Late Shri Vimal Chand
Jain, resident of Bhuj,
Gujrat.
2. Sanjeev Jain, aged
about 35 years, son of
late Kamal Chand Jain,
r/o 91-Malviya Nagar,
Bhopal (MP).
.....APPELLANTS
2
Vs.
M.P. Khadi Sanstha
Sangh, through
Secretary,Head Office
Gandhi Bhawan,
Polytechnic Chouraha,
Bhopal, Business Place-
Charmshilp/Khadi
Mandir,7, New Market,
Bhopal (MP).
.....RESPONDENT
Date of Judgment 25.02.2022
Bench Constituted Single Bench
Order delivered by Hon'ble Shri Justice Sanjay Dwivedi
Whether approved No
for reporting
Name of counsel for For appellants: Anand Chawla, Adv.
parties For respondents: None
Reserved on: 17.02.2022
Delivered on: 25.02.2022
JUDGMENT
This appeal has been filed by the appellants/landlords under Section 96 of the Code of Civil Procedure challenging the judgment and decree dated 30 th November, 2006 passed in Civil Suit No. 215-A/2006 by X Additional District Judge (Fast Track Court), Bhopal whereby the suit filed by them under Section 12(1)(f) of the M.P. Accommodation Control Act, 1961 (For short 'Act of 1961') has been partly allowed holding them entitled to get the vacant possession of first floor of House No.7, New Market, Bhopal, but the trial court has 3 refused to grant decree of Section 12(1)(f) of the Act of 1961 with regard to ground floor of the house in question in which the defendant/tenant is running a shop in the name and style "Charm Shilp".
2. Learned counsel for the appellants submits that in the second floor of the house in question the appellants/plaintiffs are running hotel business in the name and style "Hotel Anjlik" and the said hotel is being run by the partners on the basis of a partnership deed (Ex.P/4) executed on 08.02.2005 in which the plaintiffs are the partners, but, the said partnership deed is unregistered.
3. Learned counsel for the appellants submits that since the portion where the appellants' firm was doing business of hotel was not sufficient, therefore, they asked the defendant/tenant to vacate the premises, which has been occupied by them in the ground floor as well as first floor, but, they refused to vacate the said premises, therefore, on 01.03.2005, the suit was filed by the appellants/plaintiffs on the ground of Section 12(1)(f) of the Act of 1961 saying that they have no other suitable alternative accommodation in the Bhopal City for doing their business and hence the premises, which has been rented out to the respondent/defendant, is bonafidely required by them and, therefore, the decree of eviction against the defendant (tenant) be passed. 4
4. The trial court framed as many as four issues and after recording the evidence of the witnesses produced by the parties, decreed the suit granting decree of eviction only in respect of the first floor of the house in question, but, so far as the portion of ground floor is concerned, the trial court refused to grant decree of eviction mainly on the ground that the said portion belonged to plaintiff No. 2 Sanjeev Jain and he was inserted to be a partner in the business of hotel only by a partnership deed dated 08.02.2005 (Ex.P/4), but the said deed was unregistered. As per the trial court, Vimal Chand Jain (PW-1), in his statement has stated that his elder son Vineet Jain and his wife Rani Jain and the Plaintiff No. 2 Sanjiv Jain and his wife Sangeeta Jain are running the business of Hotel Anjlik and they started the said business by creating a partnership firm. The Registration Certificate (Ex. P/3) of the said hotel was produced and that reveals that the certificate was issued in the name of Anjlik firm in which Sachin Jain and Rani Jain were shown to be owner, manager and agent. Sanjiv Jain (PW-2), in his statement has stated that in the year 1997 there used to be three partners of Hotel Anjlik, but, that partnership deed of 1997 was not produced. The trial court, therefore, has found that when certificate- Ex.P/3 does not contain the name of third partner i.e. Sanjiv Jain, who was said to be a partner of Anjlik Hotel by virtue of 5 unregistered partnership deed dated 08.02.2005 (Ex.P/4), he cannot be considered to be a partner of Hotel Anjlik and for the need of that hotel, tenanted premises belongs to plaintiff No.2 cannot be evicted for the need of Hotel Anjlik.
5. Learned counsel for the appellants submits that the finding of the trial court is illegal and contrary to settled legal position because in paragraphs 7 and 9 of the judgment, the trial court considered the plaintiffs to be the landlords and defendant/respondent have been considered to be the tenant of the premises for which decree of Section 12(1)(f) was sought. He submits that the finding given by the trial court in Paragraphs 11,12,13 and 14 of the judgment refusing the decree of Section 12(1)(f) to the partner of the appellants firm of the house in question is not proper. He submits that the trial court once arrived at a conclusion that the plaintiffs are in need of first floor and they have successfully established the bonafide need for running their business of hotel and decree of Section 12(1)(f) has been passed of the premises situated on the first floor of the house in question then there was no reason for the trial court to refuse the decree of eviction in respect of the ground floor merely on the ground that the firm, which was constituted on 08.02.2005 by virtue of a deed (Ex.P/4) was not the registered firm and plaintiff No.2, who was exclusive owner of the ground floor of the 6 house in question and his need, cannot be considered to be the need of the firm, which has filed the suit.
6. Learned counsel for the appellants submits that the trial court has committed error in giving finding without considering the fact that for establishing the bonafide need if a suit is filed by the firm, it is not required that the said firm should be a registered firm. In support of his submission, learned counsel for the appellant has relied upon the decisions rendered in the cases of State of M.P. and others vs. Abbas Ali-2007 (1) MPHT 231, Bhikamlal Devangan vs. Bank of Maharashtra-2007(1) MPHT 60 (CG), Krishnan Nair and another vs. Ghouse Basha-AIR 1987 SC 2199, Fazal Bhai v. Vijay Kumar Kaushal-1972 MPLJ (Short Notes) 140, Kapoorchand v. Bhagwandas-1981 MPLJ (Short Notes) 12, Padam Singh Jain v. M/s Chandra Brothers and others-AIR 1990 Patna 95 and Bankelal vs. Madhoprashad-1997 (2) MPLJ 298
7. Learned counsel for the appellants has further urged that in view of the law laid down by the Supreme Court and also by the High Court, the judgment and decree passed by the trial court is liable to be set aside to the extent that the plaintiffs' need with regard to ground floor of House No. 7, New Market, Bhopal has not been established by them and the plaintiff No. 2/appellant No. 2's need cannot be 7 considered to be the need of the plaintiffs firm as the said firm was not registered and plaintiff No. 2 cannot be considered to be the partner of the said firm. He submits that the judgment and decree of the trial court to that extent is liable to be set aside and the suit filed by the plaintiffs be decreed in toto.
8. Considering the submission made by the learned counsel for the appellants and after perusal of record it is apparent that the trial court has refused to grant decree of eviction considering the bonafide need of Hotel Anjlik of the portion, which belongs to plaintiff No. 2, only for the reason that the plaintiff No. 2 cannot be considered to be a partner of the firm running the business of Hotel Anjlik and, therefore, his need cannot be considered to be the need of Hotel Anjlik, but, in my opinion, trial court was wrong in giving finding that the plaintiff No. 2 was not a partner of the firm, because the partnership deed dated 08.02.2005 (Ex.P/4) was not a registered document and Section 69 of the Indian Partnership Act, 1932 (hereinafter referred to as the 'Act of 1932') clearly bars that no suit to enforce a right arising out of a contract on the basis of unregistered partnership deed can be filed. Section 69 of the Act of 1932 provides as under:-
"69. Effect of non-registration.--(1) No suit to enforce a right arising from a contract or conferred by this Act shall be instituted in any 8 court by or on behalf of any person suing as a partner in a firm against the firm or any person alleged to be or to have been a partner in the firm unless the firm is registered and the person suing is or has been shown in the Register of Firms as a partner in the firm.
(2) No suit to enforce a right arising from a contract shall be instituted in any Court by or on behalf of a firm against any third party unless the firm is registered and the persons suing are or have been shown in the Register of Firms as partners in the firm.
(3) The provisions of sub-sections (1) and (2) shall apply also to a claim of set-off or other proceeding to enforce a right arising from a contract, but shall not affect,--
(a) the enforcement of any right to sue for the dissolution of a firm or for accounts of a dissolved firm, or any right or power to realise the property of a dissolved firm, or
(b) the powers of an official assignee, receiver or Court under the Presidency-towns Insolvency Act, 1909 (3 of 1909) or the Provincial Insolvency Act, 1920 (5 of 1920) to realise the property of an insolvent partner.
(4) This section shall not apply,--
(a) to firms or to partners in firms which have no place of business in [the territories to which this Act extends], or whose places of business in [the said territories], are situated in areas to which, by notification under [section 56], this Chapter does not apply, or
(b) to any suit or claim of set-off not exceeding one hundred rupees in value which, in the Presidency-towns, is not of a kind specified in section 19 of the Presidency Small Cause Courts Act, 1882 (5 of 1882), or, outside the Presidency-
towns, is not of a kind specified in the Second Schedule to the Provincial Small Cause Courts Act, 1887 (9 of 1887), or to any proceeding in execution or other proceeding incidental to or arising from any such suit or claim."
9
9. In my opinion, the trial court has also committed an error of law ignoring the requirement of respective provisions of Section 12(1)(f) of the Act of 1961 under which decree of eviction on the ground of bonafide need has been claimed. The provision of Section 12(1)(f) of the Act of 1961 reads as under:-
"12. Restriction on eviction of tenants. - (1) Notwithstanding anything to the contrary contained in any other law or contract, no suit shall be filed in any civil Court against a tenant for his eviction from any accommodation except on one or more of the following grounds only, namely :
(f) that the accommodation let for non-residential purposes is required bonafide by the landlord for the purpose of continuing or starting his business or that of any of his major sons or unmarried daughters if he is the owner thereof or for any person for whose benefit the accommodation is held and that the landlord or such person has no other reasonably non-residential accommodation of his own in his occupation in the city or town concerned];
10. A glance of the aforesaid provision makes it clear that the need of such person is material for granting decree of eviction whose interest is involved in the business for which need is claimed. Here, it is not in dispute that plaintiff No. 2 Sanjiv Jain was said to be a partner of the firm running the business of Hotel Anjlik and he was considered to be a landlord of the ground floor of the house in question and as such decree of Section 12(1)(f) of the Act of 1961 can be granted because the need even otherwise of plaintiff No. 2 can 10 be considered to be the need of the firm. It is not a suit by firm, but, it is a suit by the persons, who are landlords of the portion of the house in question and claiming their bonafide need of running the Hotel in which their interest is involved and as such if need of first floor for the hotel is found proved, the need of ground floor cannot be denied only on the ground that the plaintiff No. 2 has not been considered to be the partner of the firm for which need is shown and decree of eviction is sought. The need of plaintiff No. 2 was not denied on the ground that the hotel does not require the ground floor for its bonafide need for running the business, therefore, if need is found established by the trial court then not granting the decree on the ground as has been specified by the trial court in its judgment and decree is not sustainable and is contrary to the respective provision of Section 12(1)(f) of the Act of 1961 quoted hereinabove.
11. Not only this, but the finding of the trial court is also not sustainable that the document-Ex.P/4 since not a registered document, as such plaintiff No.2 can not be considered to be a partner of firm and suit on his behalf for the need of Hotel is not the bonafide need, whereas bar under the provision of the Indian Contract Act, 1972 does not apply in a matter of suit for eviction for the reason that Section 69 or the other provision of Contract Act will not debar a person from 11 claiming the right of eviction. The plaintiff is not enforcing the contractual right, as has been arising out of the registration of the firm, but, he is seeking decree of eviction of a premises, which can be used for bonafide need of a firm in which interest of the landlord is involved. The Supreme Court in the case of Raptakos Brett & co. Ltd. vs. Ganesh Property reported in (1998) 7 SCC 184 has clearly observed that the suit was one arising out of the contract, which stood barred by Section 69(2) of the Act of 1932, but, if a decree of possession is claimed on the basis of any unregistered document of firm, the same cannot be denied. In the said case, the Supreme Court has observed as under:-
"The respondent-plaintiff was the owner of the suit premises which is leased to the appellant-lessee for a specific period. On the expiry of that period, the respondent, which was then an unregistered partnership firm, filed a suit for a decree of possession and damages @ Rs. 200 per day for illegal occupation of the premises by the appellant- defendant. During the pendency of the suit, the respondent-plaintiff obtained registration as a partnership firm. The suit was decreed by the trial court and the decree was confirmed by the High Court. The question was whether the suit was barred by Section 69(2) of the Partnership Act. The plaint showed that the plaintiff had sought to enforce its right to get restoration of possession under the covenant of the lease and the law of the land.
The plea of the appellant was the eviction suit was not maintainable as then the plaintiff was an unregistered firm. Dismissing the appeal, the Supreme Court Held:12
On the expiry of the period of lease, the erstwhile lesee continued in possession because of the law of the land, namely that the original landlord cannot physically throw out such an erstwhile tenant by force. He must get his claim for possession adjudicated by a competent court as per the relevant provisions of law. The status of an erstwhile tenant has to be treated as a tenant at sufferance akin to a trespasser having no independent right to continue in possession."
12. Likewise, in case of Padam Singh Jain (supra), it is observed by the Patna High Court that a suit for eviction is maintainable by an unregistered firm, as such the suit is not a suit to enforce an agreement, but, a right, therefore, accrues to the landlord by reason of the provisions of statute namely Rent Act or Transfer of Property Act, as the case may be. Here, in the present case, the right accrues to the plaintiff No. 2 under the provisions of Section 12(1)(f) of the Act of 1961 and as such the decree of eviction cannot be denied to plaintiff No. 2 as Ex. P/4 is not a registered document.
13. In the case of Krishan Engineering Works (Regd.) vs. Durga Dass reported in 2000 SCC OnLine P & H 28 the Punjab and Haryana High Court dealing with the provision of Section 69 of the Act of 1932 has considered the effect of non- registration and observed "as to bar, as provided under Section 69, would be applicable under what circumstances"
and further observed that "in a suit for eviction the decree of 13 eviction cannot be denied on the ground that the document of registration of firm was not a registered one".
Relying upon a Supreme Court Decision in the case of Raptakos Brett and Co. Ltd. (supra) the Punjab and Haryana High Court has also observed as under:-
"5. It is abundantly clear that bar from filing a civil suit besides others only arises in case the said suit arises out of a contract. If the right accrues not from a contract but from another statute or enactment, in that event the provisions of Section 69 of the Act will not debar a person from claiming that right. Section 13 of the Haryana Urban (Control of Rent and Eviction) Act, specifically prescribes that if there is any violation of the provisions of the Act, right to seek eviction would arise. It is a right created by the Statute. The contract may not defeat it. Therefore, Section 69 of the Indian Partnership Act, 1932, will not be a bar.
6. This question has been considered by the Patna High Court in the case of Padam Singh Jain v. Chandra Brothers, AIR 1990 Patna 95. In the cited case it was held that suit for eviction could be filed by unregistered firm because such a suit is not enforcement of agreement.
7. In the case of Kalra Iron Stores v. Faridabad Fabricattors (P) Ltd. (No.1), 1992 (73) Company cases 330, a petition for winding up was filed by a firm which was not registered. The question for consideration was as to whether the firm must be registered and if Section 69 of the Indian Partnership Act debar the filing of eviction petition. The Delhi High Court held as under:-
"Reverting to the second objection, it has to be borne in mind that section 69 of the Indian Partnership Act contains only a prohibition on an unregistered 14 firm filing a susit to enforce a right arising from a Contract or conferred by the said Act. The firm has to be registered and the person suing has to be a registered partner. The suit to attract Section 69 has to be one to enforce a right arising from a contract or a right conferred by the Act. Mr. Khanna has not been able to cite any judgment holding that Section 69 would be applicable to winding up proceedings under the Companies Act. In the winding up petition primarily the Court is required to adjudicate whether the respondent is commercially solvent or insolvent and is not to enforce any right arising from a contract. The proceedings are not a "suit". No decree like a susit is passed. The petitioner in this case is only exercising a statutory right under the Companies Act. The right is not arising from a contract between the petitioner and the company. In my view, the provisions of Section 69 have no applicability to proceedings under the Companies Act..."
8. The conclusions drawn were as under:-
"A petition for the adjudication of a debtor as insolvent is not a proceeding to enforce a right arising from a contract. The right which the creditor who files the insolvency petition against his debtor is seeking to exercise is the right of a creditor who finds his debtor in insolvent circumstances to have the assets of the debtor administered in insolvency and distributed for the benefit of the creditors as a body. This is a right which is conferred upon the creditors by statute and is not a right arising out of a particular contract of loan between a petitioning creditor and a debtor. The mere fact that the petitioning creditors constitute a firm and the debt is due to the firm in which the petitioners are partners and they cannot file a suit to recover the amount due to them unless the firm is registered, does 15 not deprive the petitioners of their right to file a petitioa in insolvency."
9. Supreme Court considered a similar question in the case of Raptakos Brett and Co. Ltd. v. Ganesh Property (1998) 7 SCC 184 : AIR 1998 SC 3085: 1998 (4) RRR 208 (SC). The principle so enunciated was accepted that if a right accrues not out of a contract but from an enactment, Section 69 of the Indian Partnership Act, 1932 will not be a bar. In paragraph 23 of the judgment, it was held as under:-
"The net effect of this discussion, therefore, is that the plaint as framed by the plaintiff-respondent is based on a composite cause of action consisting of two parts. One part refers to the breach of covenant on the part of the defendant when it failed to deliver vacant possession to the plaintiff-lessors on the expiry of the lease after 15th March, 1985 and thereafter all throughout and thus it was guilty of breach of covenants 14 and 17 of the lease. The second part of the cause of action, however, is based on the statutory obligation of defendant-lesser when it failed to comply with its statutory obligation under Section 108 (q) read with Section 111 (a) of the Property Act. So far as this second part of the cause of action is concerned, it cannot be certainly be said that it is arising out of the erstwhile contract."
14. Considering the aforesaid enunciation of law, this Court has no hesitation to say that the approach of the trial court denying the need of plaintiff No. 2 in respect of the ground floor of the premises in question was completely erroneous and contrary to law. The trial court failed to see that the plaintiff No. 2 is not claiming any right arising out of the 16 contract among the partners of the firm, but, he is claiming eviction of the premises of which he is admittedly a landlord and is in need of that premises to develop the business of firm i.e. Hotel Anjlik in which his interest is involved as he is one of the partners of the said firm. If a dispute in respect of any right arising out of the contract is filed then the provision of the Act of 1932 applies and that suit can be considered to be barred by law as per the provisions of Section 69 of the Act of 1932, but, that situation is not existing in the present case, therefore, the finding given by the trial court in a wrong direction denying the decree of eviction of ground floor in favour of plaintiff No. 2 is, therefore, not sustainable and is hereby set aside.
15. The appeal is accordingly allowed. The judgment and decree dated 30th November, 2006 passed by X Additional District Judge (Fast Track Court), Bhopal in Civil Suit No. 215-A/2006 so far as it relates to refusing decree of eviction of the respondent/defendant from the portion i.e. ground floor of the House No. 7, New Market, Bhopal in which the respondent/defendant is a tenant and running business in the name and style 'Charm Shilp' is hereby set aside. The suit filed by the plaintiffs is decreed in toto. The respondent is directed to handover the vacant possession of the ground floor of the House No. 7, New Market, Bhopal to the 17 appellants/plaintiffs within a period of 60 days from today and in lieu of the said vacant possession the plaintiffs would pay an amount of Rs.60,000/- towards compensation, the rent of two years of rented portion, in view of the judgment and decree passed by the trial court. Parties shall bear their own cost.
(Sanjay Dwivedi) Judge Raghvendra RAGHVENDRA SHARAN SHUKLA 2022.02.28 19:21:28 +05'30'