MUNSHI LAL v. SMT. SANTOSH & ORS.

The following Order of the Court was delivered ORDER c

1Copy pinpoint1. Leave granted. ·

2Copy pinpoint2. This appeal has been filed by the landlord against the judgment and order of the High Court of Delhi in CM (M) No. 1574of2010. The High Court held that the respondent-tenant, Hakim Rai had not sub-let the premises to his son-in-law, Raj Kumar in pursuance of a partnership D deed dated 20.05.1983 entered into between them.

3Copy pinpoint3. Hakim Rai died and was substituted by respondent Nos.I to 5 i.e. his widow and four daughters. The respondent No. I, Smt. Sumitra ~ Devi, was deleted from the array of parties upon her de'ath.

4Copy pinpoint4. The landlord sought the eviction of the tenant'on the ground· E that the tenant had sub-let the premises to his son-in-law in contravention. · of Section 14 of the Delhi Rent Control Act, 1958 (hereinafter referred. to as 'the Act'). The landlord had also sought eviction of the tenant on the ground of arrears of rent. As of now the only ground that stitvives is . that of sub-letting the tenant having paid off the arrears according to · ~ F

5Copy pinpoint5. The tenancy was in respect of a Kiraria shop at the monthly rent of RS. 501-. The tenant w~s an old .and infirm man, incapable of running the business on his own. It has been found.that.the son-in-law . sat in the shop and conducted business exclus.ively therefrom. The dispute was whether he was doing business along .with his fatber,in-law or G independent ofbim, i.e. whether be was doing business exclusively behind the fa~ade of a partnership or as a genuine partner. It is an uncontroverted fact before us that the landlord's permission in writing was not obtained ·before the tenant bad allowed the alleged sub-tenant to occupy the shop. H

p. 596

6Copy pinpoint6. The Rent Controller found that the partnership was a ruse and that it was the son-in-law who was in exclusive possession of the shop and running the business on his own. No books of accounts were maintai"ned, no profit and loss accounts were maintained, and no stock registers concerning the goods in the shop were maintained, as required by the partnership deed. Moreover, the tenancy rights with respect to B ·the lease of the shop were found to have been made property of the partnership finn. The evidence of the widow of the tenant who inherited the tenanted premises and Claimed to be running the business along with her son-in-la·.v was held incredible. She was unable to give any details of the amount invested in the shop, or any details of profit and loss. c Thus, the Rent Controller clearly found that the son-in-law had been put in possession of the shop in pursuance of a sham partnership deed and was not merely assisting in the shop as a son-in-law.

7Copy pinpoint7. With regard to the arrears ofrent, it was an undisputed position that the tenant had been granted the benefit of Section 14(2) of the Act, D a& it was a case of first default and the tenant had complied with the order passed under Section 15( 1) of the Act.

8Copy pinpoint8. The landlord contested the appeal on the only remaining ground of sub-tenancy. The Appellate Authority observed that it could not be said that there was a parting of possession if an alleged sub-tenant was E closely related to a tenant, or if he was a person whose assistance was a matter ofnecessity forthe survival of the business of the tenant. Thus, since the alleged sub-tenant was a close relative i.e. a son-in-law of the tenant, there was no parting of possession and therefore no sub-letting. The appellate authority relied on Smt. Krishnawati Vs. Shri Hans Raj F (1974) I SCC 289 in which it was held that in ar. arrangement where the premises was rented by the husband, and the wife was allowed to carry out business in a part of the premises, would not amount to sub- letting.

9Copy pinpoint9. The High Court concurred with the finding of the appellate G authority that the son-in-law had come to Delhi to assist his father-in- law in business for which a partnership deed had been executed between them, and he resided at the same premises as his father-in-law. The partnership was a genuine partnership as it could not be said that it had been entered into for the purpose of subletting. The father-in-law had not in any manner given the possession of the shop in question exclusively H

MUNSHI LAL v. SMT. SANTOSH & ORS. 597

to his son-in-law thereby divesting himself ofit. Thus the mere occupation of his son-in-law was not sufficient to establish a case of subletting. I 0. Having heard the learned counsels for both parties, we find that a significant fact which has not been controverted by the respondents has been completely overlooked in the proceedings of the courts below. That fact is that no consent in writing was obtained from the landlord before the so called partnership was entered into between the tenant and the sub-tenant, and before the sub-tenant was allowed to occupy the premises.

11Copy pinpoint11. Section 14(1) of the Act reads as under:- c "(14)(1) Notwithstanding anything to the contrary contained in any other law or contract, no order or decree for the recovery of possession ofany premises shall be made by any court or Controller in favour of the landlord against a tenant: Provided that the Controller may, on an application made to him in the prescribed manner, make an, order for the recovery of possession of the premises on one or more of the following grounds only, namely:- (a) That the tenant has neither paid nor tendered the whole of the arrears of the rent legally recoverable from him within two months of the date on which a notice of demand for the arrears of rent has been served on him by the landlord in the manner provided in section I 06 of the Transfer of Property Act, 1882; (b) that the tenant has, on or after the 9"' day ofJune, 1952, sub- let, assigned or otherwise parted with the possession of the whole or any part of the premises without obtaining the consent in writing of the landlord''. Clause (b) of the proviso to sub-section (1) provides for the eviction of e tenant who has sub-let, assigned or 0th~rwise parted with the possession of the premises without obtaining th~ consent in writing of the landlord. G Section 14 (4) reads as follows:- ., "( 14)(4 )For the purposes ofclause (b) 'Jf the proviso to sub-section (1 ), any premises which have been let for being used for the purposes of business or profession shall be deemed to have been sub-let by the tenant, if the Controller is satisfied that the tenant H'

598 . SUPREME COURT REPORTS [2017] I S.C.R.

A without obtaining the consent in writing of the landlord has, after the l 6'h day of August, 1958, allowed any person to occupy the whole or any part of the premises ostensibly on the ground that such person is a partner of the tenant in the business or profession but really for the purpose of sub-letting such premises to that person." B This sub-section provides that if a person is allowed to occupy the premises ostensibly as a partner of the tenant but really for the purpose of sub-letting it, suc;h an arrangement would be deemed to be sub-letting. Therefore, ifthe tenanthas allowed any person to occupy the whole or c ·any part of the premises; actually for the purpose of sub-letting but · speciously by entering into a partnership with him, such an arrangement shall be deemed to be subletting. In other words, subletting is not permitted by camouflaging it as a partnership. The combined reading of clause (b) of the proviso to Section 14(1) read D with Section 14(4) makes it clear that before a tenant can sub-let, assign" or part with the possession of any part of the premises br the whole, it must be preceded by the consent in writing from the landlord. In other words, the requirement of obtaining the consent in writing of the landlord is retained as a pre-requisite even for the purpose~ of sub-section (4). What ·is of importance is; in either case whether a person has been . E inducted genuinely as a partner and therefore allowed to occupy .the premises or whether the partnership is a ruse, the requirei:nent of consent in writing as in sub-section (1) is retained. In the present case, there is no evidence that the tenant obtained the consent in. writing from the landford before: allowing the son-in-law to occupy the premises in pursuance of the Partnership deed.

12Copy pinpoint12. We are satisfied that the respondents-tenants have been founi! to have inducted the son-in-law·as a sub-tenant for the purpose of doing business under a partnership agreement. The arrangement between Hakim Rai and his son-in-law Raj Kumar was not a casual arrangement wherein the latter was requested to conduct business at the shop because the former was old and infirn'l. There was no need of entering into a· partnership agreement .in that case.

13Copy pinpoint13. We find upon scrutiny of the evidence in this case that the learned Rent Controller was right in coming to the conclusion that the parties .had not acted on the partnership wliich was shown, and that H

MUNSHI LAL v. SMT. SANTOSH & ORS. . ·599

there was a parting of possession of the premises in which the son-in- A law was allowed to occupy the premises and carry out business exclusively. There is no evidence on record that the account books were maintained and the profits were shared between the parties as partners. The son:it:!-law had aqcepted that he was carrying out a business of sale of merchandise from the shop. .B

14Copy pinpoint14. It is not possible for us to appreciate the view of the appellate · authority that there would be no parting of possession if the alleged sub- tenant is a close relative like a son-in-la,w, In this case; the relationstip is not like that of a spouse being allpwedto carry qut a business in. the same house. The relationship is of a son-in-Jaw aqd father-in-law who had entered into a partnership agreement.. c IS. In any case, there was a failure to obtain consent in writing from the appellants which is a clear pre-requisite for allowing any person to occupy the premises. In other words, a tenant cannot be allowed to employ a subterfuge and permit another person to occupy the premises : by claiming that he is a partner when the real intention is to sublet, without D obtaining the consent in writing of the landlord.

16Copy pinpoint16. In these circumstances, we find that the occupation of the shop by Raj Kumar amounts to a sub-letting within the meaning of Section 14( 1) (b) read with Section 14(4) of the Act and the respondents are liable for eviction. E

17Copy pinpoint17. We accordingly, set aside the ord~r of the High Court and direct that the respondents shall be evicted. However, time to v.acate. the scheduled premises is granted till 31" October, 2017 on filing the usual .undertaking by them within four weeks from· today. Till such a time, the rent atthe rate of Rs. 1-0,000/- per month shall be paid by the F respondents to the appellant.

18Copy pinpoint18. The appeal is disposed of with above observations and directions.

G • Kalpana K Tripathy Appeal dipsosed of.