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Showing contexts for: sub tenancy in District Judge Delhi vs M/S Ebony Fashions Pvt Ltd on 2 March, 2007Matching Fragments
11. DW-1 Sh Anil Vig, Managing Director of M/s Ebony Fashions Pvt Ltd in his affidavit he has deposed that there was specific management agency agreement with defendant No 2 for boosting sale of Bombay Dyeing Products and in return defendant No 1 was getting Rs 25,000 as minimum guarantee profit and status of defendant No 2 is certainly not of a sub- tenant, therefore, termination of the tenancy on the ground of sub-tenancy is illegal and not tenable in the eyes of law. In his cross examination, he has denied that landlord relationship existed between defendant No 1 and defendant No 2. He has also admitted that he has heard name of Avinash Singh who is son of Pushpinder Kaur but he has never seen him personally.
26. The second case which came up before Hon'ble Supreme Court was Rajbir Kaur vs Chokosiri & Co AI R 1988 SC 1845. It was under the provisions of East Punjab Rent Control Act. In that case, the tenant had executed two documents in favour of alleged two sub tenants lebelled as deed of license and their contents were in conformity with a license deed and not a lease deed. The Rent Controller held that evidence on record indicated that tenant had given ''exclusive possession'' of the tenanted premises to a sub tenant. There was no evidence that the exclusive possession was given for any monetary consideration. Ld Rent Controller drew an inference of payment of monetary consideration by sub tenant on the basis of presumption and held that since exclusive possession was transferred against consideration, it was ''subletting''. Their lordships upheld the decision of the Rent Controller and observed that the transaction of sub tenancy between tenant and sub tenant was of clandestine nature, therefore, once the exclusive possession of sub tenant was established, it might not be impermissible for the court to draw an inference that the transaction was entered into against monetary consideration and such transactions was sub letting in the eyes of law. From the observations of Hon'ble Supreme Court made in aforesaid two cases, now the law has emerged that landlord has to prove two ingredients to attract disability of Rent Control Acts on the tenants, namely, (1) A tenant has parted with exclusive possession of the tenanted premises to a third person and (2) parting with of exclusive possession must be in lieu of payment for enjoyment of exclusive possession. In the present case, the showroom in question was exclusively managed by defendant No 2 and it was in exclusive possession thereof. Defendant No 1 after alleged arrangement came to an end had to file a suit against defendant No 2 to recover possession. Secondly by terms of Ex D1W3/A, the arrangement could have been terminated only on three months notice in writing on either side. In other words, defendant No 1, if it wanted to put itself again in possession of suit premises under the arrangement as referred to above, it was to give notice of three months. For three months, as a matter of right, defendant No 2 could have continue in possession of the suit premises. In my opinion, defendant No 1 has parted with exclusive possession of the suit premises to defendant No 2. By virtue of clause 14 of the arrangement, defendant No1 had not only divested himself of exclusive possession but the right to recover possession even though temporarily for a period of three months. Even otherwise, according to two decisions of Hon'ble Supreme Court as referred to above, what the landlord has to prove is that tenant had parted with ''exclusive possession'' of whole or part of the tenanted premises to another person and secondly against consideration. Hon'ble Supreme Court has gone to the extent of observing when parting with exclusive possession by tenant in favour of third person is proved, Court will presume passing of exclusive possession against consideration. Therefore, I am of the view that it stands proved on record that defendant No 1 had parted with exclusive possession of the suit premises to defendant No 2 against consideration.
210. The latter authority was on the provisions of Madhya Pradesh Accommodation Control Act. In view of the provisions then existing in Madhya Pradesh Accommodation Act, since section 3 of that Act empowered the Rent Control Authority to decide whether a sub tenancy was lawful where the landlord disputed the same and when such application is made before the Rent Controller, it was the rent Controller to decide lawfulness of the sub tenancy and jurisdiction of the Civil Court was barred. The former authority was with reference to West Bengal Rent Control Act. In that authority the question had arisen where the landlord had given lease of the business along with machinery in a building settled on the appellant not including the premises or accommodation, the decisive factor was the dominant intentions of the parties while creating lease which was to be gathered by construing terms of lease deed. Their lordships came to the conclusion that since intentions of the parties was not to settle or grant lease of the structure or shed and basically the arrangement was regarding letting of the business, the provisions of West Bengal Tenancy Act were not attracted. Both these authorities are not attracted to the facts of the present case. In none of aforesaid authorities, question of jurisdiction similar to the provisions of Section 3 of the Delhi Rent Control Act had arisen. Provisions of Section 3 of the Delhi Rent Control Act were added in the year 1988 for the first time by virtue of Delhi Rent Control ( Amendment Act ) 1988. According to this provision all the tenancies of which the rent was more than Rs 3500 were taken out of the protective umbrella of Delhi Rent Control Act. The protective umbrella of the said Act thus remains confined only to the premises in respect of which rent payable was upto Rs 3500 per month. Question arises whether the limitation of rent is in respect of ''premises'' or in respect of the ''liability of a particular tenant to pay it.'' In other words whether a premises in respect of which the rent payable by a tenant is less than Rs 3500 but if the tenant has created a sub tenancy and receiving more than Rs 3500 whether the protection of DRC Act would also be attracted to this situation? The decision of this question rests on the answer as to what is the interpretation of the words '' any premises'' '' whose monthly rent exceeds Rs 3500'' as mentioned in Section 3 of the DRC Act. In this respect there are number of decisions of our own Hon'ble High Court which have direct bearing on this issue. In the first case reported as Mercury Travels ( India) Ltd vs Mahabir Prasad & Anr 89 ( 2001) DLT 440(DB). In this authority two separate rents agreements had been executed between the parties on the same day fixing Rs 4200 per month for the one unit and Rs 1800 per month for another unit. Both the lease deeds were executed and registered on the same. It was held that intentions of the parties was to create single tenancy and since the rent in respect of tenanted premises was Rs 6000, Civil Court was competent to entertain the suit. In that case the ground of sub letting by the tenant was relied upon as one of the ground of eviction. Initially suit was fled in the court of rent Controller from where it was withdrawn and subsequently was filed in Civil Court, therefore, it was held that Civil Court had jurisdiction to entertain the suit. There is another authority reported as Atma Ram Properties(P) Ltd Vs Pal Properties (India) Pvt Ltd & Ors, 91(2001) DLT 438. In this case the facts were that the tenant in respect of a suit premises had been paying rent less than Rs 3500 but he had inducted a sub tenant in portion of the property from which he had been charging more than Rs 3500 per month. It was specifically argued that suit was argued that suit was barred U/s 50 DRC Act but their lordships of our own High Court negatived the contention and held that U/s 3 of the DRC Act, the protection of DRC can be extended only to the premises rent of which was Rs 3500 and not beyond that and since the sub tenant had been paying more than Rs 3500, therefore, rent in the respect of the premises being more than Rs 3500, Civil Court has jurisdiction to entertain the suit for recovery of possession by the landlord. The following observations made by their lordships of our own high court in P.S.Jain Co Ltd vs Atma Ram Properties and Ors 65 ( 1997) DLT 308 ( DB) was relied upon '' The point for consideration in the appeal is: whether a tenant who is paying a rent of Rs 900/- per month ( less than Rs 3,500/- as specified in Section 3 © of the Delhi Rent Control Act, 1958) through the Civil Court as he has lawfully sublet the premises to two tenants, one for Rs 40,000/- p.m. and another for Rs 4500/- p.m. ( in each case for more than Rs 3,500p.m.) ? It was, therefore, held by their lordships that relevant rent for the purpose of determining whether tenanted premises is covered by section 3 is the rent which is payable by the sub tenant and therefore, no protection can be claimed by the tenant U/s 50 of the DRC Act if rent payable by sub tenant was more than Rs 3500. In view of this authorities referred to above, I am of the view that for the purpose of determining whether this court has jurisdiction to entertain the suit or not the decisive factor is that whether section 3 of DRC Act is applicable to the case. If court comes to the conclusion that rent payable either by the tenant or sub tenant was more than Rs 3500 per month, premises being one in respect of which is more than Rs 3500, protection of DRC will not be available to the tenant and civil Court would have jurisdiction to entertain the suit. Of course, it will have to be proved as per law by the landlord that amount above Rs 3500 being paid by tenant or sub tenant was ''rent''. While deciding the issues no.1 and 6 I have held that amount of Rs.25,000/- p.m paid by defendant no.2 to defendant no.1 was rent. Therefore, when the rent of suit premises exceeded Rs.3500/- Civil Court has jurisdiction to entertain the suit.
41. The second link of argument of ld counsel for defendant No 1 is question regarding sub tenancy can be decided by the Rent Controller and civil Court. There is a patent fallacy in the argument. Once it is proved on record tantamount of Rs more than 3500 is being paid by a tenant or sub tenant as rent'' the premises'' in respect of which such rent is payable ceases to be governed by the provisions of DRC Act. When DRC Act ceases to be applicable on a particular premises by virtue of the said reasons, the Rent Controller ceases to entertain the dispute of existence of sub tenancy in respect of a premises over which he does not entertain any jurisdiction. By legal analogy after a particular premises ceases to have protection of DRC Act, the jurisdiction to decide issue of for existence of sub tenancy would vest in the Civil Court.