Bombay High Court
Indrakumar Dwarkadas Chhabria And Ors vs Karishma A. Chugh Decd. Through Lhrs And ... on 8 July, 2024
Author: Sandeep V. Marne
Bench: Sandeep V. Marne
2024:BHC-AS:27335
Sonali Mane 15-WP-2418-2020(FC).doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO. 2418 OF 2020
Indrakumar Dwarkadas Chhabria and Ors. ... Petitioners
Versus
Karishma A. Chugh and Ors. ... Respondents
WITH
INTERIM APPLICATION NO. 1354 OF 2021
IN
WRIT PETITION NO. 2418 OF 2020
M/S. Swastika Air Systems Pvt. Ltd. ... Applicant
IN THE MATTER BETWEEN
Indrakumar Dwarkadas Chhabria and Ors. ... Petitioners
Versus
Karishma A. Chugh and Ors. ... Respondents
WITH
INTERIM APPLICATION NO. 1353 OF 2021
IN
WRIT PETITION NO. 2418 OF 2020
WITH
INTERIM APPLICATION NO. 1352 OF 2021
IN
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Digitally
signed by
8 July 2024
MANE
MANE SONALI
SONALI DILIP
DILIP Date:
2024.07.11
18:03:40
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WRIT PETITION NO. 2418 OF 2020
WITH
INTERIM APPLICATION NO. 18685 OF 2022
IN
WRIT PETITION NO. 2418 OF 2020
N R Jet Pharmaceuticals Ltd. ... Applicant
IN THE MATTER BETWEEN
Indrakumar Dwarkadas Chhabria and Ors. ... Petitioners
Versus
Karishma A. Chugh and Ors. ... Respondents
_____________________________________________
Mr. Rahul Narichania, Senior Advocate a/w Mr. Kunal Dwarkadas i/b
Mehta & Co. for the Petitioners.
Mr. Pradeep Thorat a/w Mr. Amogh Singh for the Respondent No.8.
Mr. G. S. Godbole, Senior Advocate a/w Mr. Abhishek Khare i/b Khare
Legal Chambers, for Respondent No. 12.
CORAM : SANDEEP V. MARNE, J.
DATE : 8 JULY 2024.
ORAL JUDGMENT :
1) The challenge in the present Petition is to be Order dated 13 January 2020 passed by the Appellate Bench of the Small Causes Court by which Miscellaneous Appeal No. 305 of 2019 filed by Original Defendant ___Page No.2 of 12___ 8 July 2024 ::: Uploaded on - 11/07/2024 ::: Downloaded on - 20/07/2024 17:06:37 ::: Sonali Mane 15-WP-2418-2020(FC).doc Nos. 1, 4, 7 and 8 has been allowed and the Order passed by the Small Causes Court on 18 July 2019 in application at Exhibit-68 has been set aside. The Application at Exhibit-68 was filed by Petitioners seeking appointment of Court Receiver to take possession of the suit premises from Defendant No.9. That application was allowed by the Trial Judge by Order dated 18 July 2019, by which Court Receiver was appointed in respect of the suit premises and Defendant No. 9 was directed to hand over possession thereof to Petitioners. Defendant No.9 was further restrained from parting with possession thereof to Defendant No.8 till disposal of the suit.
2) Petitioners/Plaintiffs have filed R.A.E. & R. Suit No. 620/1726 of 1991 initially against Defendant Nos. 1 to 9 seeking recovery of possession of the suit premises on the ground that though the lease in respect of the suit premises was initially executed in favour of Defendant Nos. 1 to 7, Defendant No.8 has illegally come in possession thereof. It is further alleged that Defendant No.8 illegally inducted Defendant No.9 in the suit premises. This is how recovery of suit premises from Defendant Nos. 1 to 9 has been sought in the suit. It appears that, during pendency of the suit it was discovered that Defendant Nos. 10, 11 and 12 were found to be in possession of the suit premises and accordingly they have been impleaded as Defendants to the Suit.
3) It appears that in the Suit an injunction Order dated 18 June 2004 is passed, under which Defendants are restrained from further parting with the possession of the suit premises till final hearing and disposal of the suit.
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4) It appears that, the arrangement made between Defendant Nos.
8 and 9 has come to an end on upon determination of lease in the year 2016 and accordingly Defendant No.9 was desirous of quitting the suit premises by handing over possession thereof to Defendant No.8. At this stage, Plaintiffs filed application at Exhibit-68 for appointment of Court Receiver to take possession of the suit premises from Defendant No.9. The application has been allowed by the Small Causes Court by Order dated 18 July 2019, which has been reversed by the Appellate Bench by impugned order dated 13 January 2020, which is subject matter of challenge in the present Petition.
5) I have heard Mr. Narichania the learned senior advocate appearing for the Petitioners. He would submit that Defendant No.8 has been unlawfully possessing the suit premises and has created further unlawful interest in favour of Defendant No. 9. That subsequently it was found that Defendant Nos. 10 and 11 were also occupying the suit premises. Now it has transpired that Defendant Nos. 9, 10 and 11 have merged into Defendant No. 12. This is how, though the initial lease in respect of the suit premises was executed in favour of Defendant Nos. 1 to 7, altogether different entities are found to be occupying the suit premises. Since Defendant No. 8 himself is in unlawful possession of the suit premises and has no right to induct Defendant No. 9, if Defendant No.9 wants to quit and hand over possession of the suit premises, the same ought to have been given to Plaintiff and not to Defendant No. 8. He would further submit that on account of conduct of Defendant No. 8 as well as absence of any right either to remain in possession of the suit premises or to induct any third parties, the possession of the suit premises cannot be handed over to Defendant No. 8 by ___Page No.4 of 12___ 8 July 2024 ::: Uploaded on - 11/07/2024 ::: Downloaded on - 20/07/2024 17:06:37 ::: Sonali Mane 15-WP-2418-2020(FC).doc Defendant No. 9 and that therefore application was rightly made to the Small Causes Court for appointment of Court Receiver for taking over possession from Defendant No.9. He would further submit that Defendant No.8 cannot continue to possess the suit premises on the same original terms by seeking recovery thereof from Defendant No.9. That in the event Defendant No.8 wants to possess the suit premises, the same has to be as an agent of the Court Receiver on payment of royalty.
6) Mr. Narichania would further submit that the Appellate Bench of the Small Causes Court has committed serious error in reversing the well- considered order of the Small Causes Court. He would submit that the learned Appellate Bench has erroneously assumed an admission on the part of the Plaintiffs that the possession of the entire suit premises should be with Defendants. That on the contrary, Plaintiffs claim that none of the Defendants can remain in possession of the suit premises. He would further submit that the Appellate Bench has erroneously assumed that no prima facie case existed on account of which, the earlier prayer for appointment of Court Receiver got rejected. He would submit that on the contrary, the Appellate Bench has specifically recorded in the Order dated 18 June 2004 that there is strong prima facie case for grant of interim relief in favour of the Petitioners. He would therefore submit that the assumption on the part of the Appellate Bench of the Small Causes Court that no prima facie case exists in favour of Petitioner is entirely wrong.
7) Mr. Narichania would further submit that the Appellate Bench has erroneously assumed that the suit was stayed when the Order came to be ___Page No.5 of 12___ 8 July 2024 ::: Uploaded on - 11/07/2024 ::: Downloaded on - 20/07/2024 17:06:37 ::: Sonali Mane 15-WP-2418-2020(FC).doc passed by the Single Judge on 18 July 2019, when in fact, the stay by this Court was already vacated by Order dated 26 September 2017. He would further submit that the Appellate Bench has erroneously assumed that Johnson & Johnson was not impleaded in place of Defendant No. 9 in the suit, when in fact application for impleadment was filed on 23 February 2019 and the same was in fact allowed. Mr. Narichania would therefore submit that the Order passed by the Appellate Bench is erroneous and is therefore liable to be set aside.
8) The Petition is opposed by Mr. Thorat, the learned counsel appearing for original Defendant No. 8. He would submit that the suit premises were leased out to Defendant No.9 by Defendant No. 8 by virtue of Lease Agreement dated 27 January 1987 and that the same was executed in terms of the original lease of 11 February 1972. He would submit that the Plaintiffs were specifically intimated about change in the composition of Defendant Nos. 1 to 7 and about Defendant No. 8 becoming successor-in- title of Defendant Nos. 1 to 7 by letter dated 28 December 1976. That noting the contents of the letter dated 28 December 1996, Plaintiffs in fact called upon Defendant No. 8 to pay arrears of rent in the name of Indrakumar Dwarkadas Chhabria. That accordingly the rent in respect of the suit premises is indeed being paid by Defendant No. 8 and accepted by the Plaintiffs. That since induction of Defendant No. 9 by Defendant No. 8 by virtue of Lease Agreement dated 27 January 1987 is in tune with the original lease dated 11 February 1972, Defendant No. 8 must receive possession of the suit premises from Defendant No. 9. He would pray for dismissal of the Petition.
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9) Mr. Godbole the learned senior advocate would appear on
behalf of original Defendant Nos. 9 to 12. He would submit that Defendant Nos 9, 10 and 11 have merged into Defendant No. 12 - Johnson & Johnson Pvt. Ltd. That original Defendant No. 9 and now Defendant No. 12, which is the resultant entity out of merger, wants to hand over possession of the suit premises to Defendant No. 8, from whom the possession thereof was obtained by virtue of the Lease Agreement dated 27 January 1987. That the injunction Order passed by the Small Causes Court on 18 June 2004 restraining all the Defendants from parting with possession of the suit premises is coming in the way of original Defendant No. 9 from quitting the premises. Since the lease between Defendant Nos. 8 and 9 was prematurely terminated in the 2016, Defendant Nos. 9 to 12 need to be relieved of any obligations arising out of the suit premises by handing over its possession to the entity from whom the premises were originally taken on lease. He would also pray for dismissal of the petition.
10) Having heard the submissions canvassed by the learned counsel appearing for the parties, it is seen that Plaintiffs have filed R.A.E. & R. No. 620/1726 of 1991 initially against Defendant Nos. 1 to 9 contending that Defendant No.8 has unlawfully come in possession of the suit premises. though the Lease Agreement dated 11 February 1972 was executed only in favour of Defendant Nos. 1 to 7. Eviction of Defendant No. 9 is also sought on the ground that Defendant No. 8 has illegally inducted Defendant No.9. The suit is resisted by Defendant No. 8 by raising a plea that though the suit premises were originally leased out to Defendant Nos. 1 to 7, the partners of Defendant No. 7 formed Defendant No.8-Company and now they have ___Page No.7 of 12___ 8 July 2024 ::: Uploaded on - 11/07/2024 ::: Downloaded on - 20/07/2024 17:06:37 ::: Sonali Mane 15-WP-2418-2020(FC).doc become the directors of Defendant No.8. This is how Defendant No.8 claims to the successor entity in respect of Defendant Nos.1 to 7. This position is seriously disputed by the Plaintiffs and this issue needs to be decided by the Small Causes Court while deciding the suit finally. As of now, the defence of Defendant No. 8 is such that it has stepped into the shoes of Defendant Nos. 1 to 7 and in fact become lessee by virtue of Lease Agreement dated 11 February 1972. Whether this position is valid in the eyes of law is something needs to be decided in the suit. Defendant No. 8 also contends that the clauses of the Lease Agreement dated 11 February 1972 permit the lessee not only to construct on the suit premises but also to induct third parties in such constructed portions. Defendant No.8 accordingly contends that it has right to induct outsiders in the constructed portion of the suit premises and accordingly Defendant No.9 came to be inducted by Lease Agreement dated 27 January 1987. It appears that similar agreements were also executed by Defendant No. 8 in favour of Defendant Nos. 10 and 11. All those agreements in favour of Defendant Nos. 9 to 10 have come to end by the years 2016/2017. Whether this arrangement is valid in the eyes of law is again an issue to be decided by the Small Causes Court.
11) In my view, as of now the limited issue is with regard to the exact party who is entitled to receive possession from Defendant Nos. 9 to 10 (who have now merged in Defendant No. 12). Admittedly the lease relationship arising out of the Agreement dated 27 January 1987 between Defendant Nos. 8 and 9 has come to an end. Defendant No. 9 wanted to hand over possession of the suit premises. However, on account of interim order passed by the Appellate Bench of the Small Causes Court on 18 June ___Page No.8 of 12___ 8 July 2024 ::: Uploaded on - 11/07/2024 ::: Downloaded on - 20/07/2024 17:06:37 ::: Sonali Mane 15-WP-2418-2020(FC).doc 2004 of the Defendants were restrained from parting with possession of the suit premises. The contest between Plaintiffs and Defendant No.8 is about right to receive possession of the suit premises from Defendant No.9. Since the Lease Agreement is admittedly executed with Defendant No. 9 by Defendant No. 8, ideally the possession of the suit premises should be restored to Defendant No. 8, subject to the right of the Plaintiffs to seek recovery of the suit premises from all Defendants. Mere handing over of possession by Defendant No. 9 to Defendant No. 8 on account of expiry of relationship arising out of Agreement dated 27 January 1987 would obviously not affect the rights of the Plaintiffs arising out of the pending Suit before the Small Causes Court.
12) It appears that the Plaintiffs had earlier attempted appointment of Court Receivers by filing Notice No. 4 of 2001 at which time, the lease arrangement between Defendant Nos. 8 and 9 was subsisting. The said notice was dismissed by the Small Causes Court and the Order of the Small Causes Court has been upheld by the Appellate Bench. Thus, the prayer of the Plaintiffs for appointment of Court Receiver in respect of the suit premises during subsistence of lease arrangement between Defendant Nos. 8 and 9 has once been rejected. In the light of this position, whether Plaintiffs can have another bite at the cherry after expiration of the lease arrangement between Defendant Nos. 8 and 9? The answer, to my mind, appears to be in the negative. Therefore mere expiration of the lease arrangement between Defendant Nos. 8 and 9 could not have been a reason for the Small Causes Court to entertain another application filed by the Plaintiffs for appointment of Court Receiver in respect of the suit premises.
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13) The suit is 'Rent Act Eviction and Recovery Suit' (R.A.E.&R.).
It is filed under the provisions of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947. Therefore, possession to the Defendants in respect of the suit premises would become illegal only on the date of passing of the decree. Till the decree for eviction is passed, this being a Rent Act suit, the Defendants would be in a position to enjoy possession of the suit premises. Possession of Defendants over the suit property would become unlawful only upon passing of decree for eviction. Following conclusion summed up by the Apex Court in Atma Ram Properties (P) Ltd Vs. Federal Motors (P) Ltd (2005) 1 SCC 705 would be relevant in this regard:
" (2) in case of premises governed by the provisions of the Delhi Rent Control Act, 1958, in view of the definition of tenant contained in clause (l) of Section 2 of the Act, the tenancy does not stand terminated merely by its termination under the general law; it terminates with the passing of the decree for eviction. With effect from that date, the tenant is liable to pay mesne profits or compensation for use and occupation of the premises at the same rate at which the landlord would have been able to let out the premises and earn rent if the tenant would have vacated the premises."
In that view of the matter, there is no question of appointment of Court Receiver for taking over the possession of the suit premises from Defendant No.8.
14) Further, mere execution of the Lease Agreement 27 January 1987 by Defendant No. 8 in favour of Defendant No. 9 does not affect the original right, if any, of Defendant No. 8 to claim leasehold rights under Lease Agreement dated 11 February 1972. Therefore, upon vacation of the suit premises by Defendant No. 9, since Defendant No. 8 would continue to assert its rights arising out of Lease Agreement dated 11 February 1972, it ___Page No.10 of 12___ 8 July 2024 ::: Uploaded on - 11/07/2024 ::: Downloaded on - 20/07/2024 17:06:37 ::: Sonali Mane 15-WP-2418-2020(FC).doc would naturally be entitled to receive possession of the suit premises from Defendant No. 9. In my view, therefore, no serious error is committed by the Appellate Bench in reversing the Order passed by the Small Causes Court.
15) I therefore do not find any reason to interfere in the impugned order dated 13 January 2020 passed by the Appellate Bench. The Writ Petition, being devoid of merits, deserves to be dismissed. It is seen that the suit is pending since the year 1991 and it is in the interest of all the parties that the same is decided in an expeditious manner. The Small Causes Court must have already expedited the decision of the suit considering its pendency since the year 1991. It shall make an endeavor to decide the same by 31 December 2025.
16) It is also clarified that though Defendant No. 8 will be entitled to receive possession of the suit premises from Defendant Nos. 9 to 12, Defendant No. 8 is already restrained by Order dated 18 June 2004 passed by the Appellate Bench from further parting with possession of the suit premises. Mr. Thorat has fairly submitted that Defendant No. 8 shall take necessary steps for the purpose of protecting the suit premises from being trespassed by any outsiders. Obviously since the Order of the learned Judge of the Small Causes Court dated 18 July 2019 appointing Court Receiver is reversed by the Appellate Bench, which enables Defendant No.9 to hand over possession of the suit premises to Defendant No.8, it is clarified that handing over possession by Defendant Nos. 9 to 12 to Defendant No.8 would not amount of violation of the interim Order passed on 18 June 2004.
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17) It is clarified all the observations made in the Order are only
prima facie and are recorded for the limited purpose of deciding the issue of appointment of Court Receiver and the Small Causes Court shall not be influenced by the any of the observations made in the Order while deciding the suit finally.
18) Writ Petition is accordingly dismissed with no orders as to costs In view of dismissal of the Writ Petition, all pending Interim Applications do not survive and the same are also accordingly stand disposed of.
19) After the Order is pronounced, Mr. Narichania would pray for continuation of interim order granted by this Court on 11 March 2020 for a period of eight weeks. He would submit in the alternate that Plaintiffs be permitted to appoint their security guards at the suit premises for a period of eight weeks at their own costs. The requests are opposed by Mr. Thorat and Mr. Godbole. Considering the position that Defendant Nos. 9 to 12 are unnecessarily made to possess the suit premises despite of expiry of their lease arrangement with Defendant No.8 in the years 2016/2017, continuation of interim order would mean continued possession by Defendant Nos. 9 to
12. I am therefore not inclined to continue the Interim Order dated 11 March 2020. Permitting Plaintiffs to deploy their security guards after dismissal of their petition would virtually mean handing over of possession to the suit premises to Plaintiffs. Both the requests of Mr. Narichania are accordingly rejected.
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