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2003(3) Supreme 62
SUPREME COURT OF INDIA
(From Kolkata High Court)
Doraiswamy Raju and D.M. Dharmadhikari, JJ.
Arm Group Enterprises Ltd. -Appellant
versus
Waldorf Restaurant & Ors. -Respondents
Civil Appeal Nos. 2609-2610 of 2003
(Arising out of SLP (C) Nos. 18045-18046 of 2000)
Decided on 1-4-2003
Counsel for the Parties :
For the Appellant : A.K. Mitra and Dr. A.M. Singhvi, Jaideep Gupta, Sr. Advocates, Anil Agarwalla, S. Singhvi and K.V. Vijayakumar, Advocates.
For the Respondents : Shanti Bhushan, Sr. Advocate, Bimal Chatterjee, David Mantosh, Mrs. Sumita Mukherjee, Raja Mantosh, Ms. Vandana Jalan, P.R. Ramasesh, Satish Vig, Advocate (NP)/Advocates.
Held : On the side of the landlord the application for execution filed by it was allowed by the learned Single Judge of Calcutta High Court on 20.4.2000. Learned Single judge of the High Court came to the conclusion that the firm came into existence on its registration under Partnership Act only on 1.3.1954 i.e. after the surrender of tenancy by the original tenant on 31.8.1953. In the opinion of the High Court, the registered partnership firm could not have been inducted as a sub-tenant, as alleged on 1.7.1953, when as a matter of fact on that date the Restaurant was only a proprietary concern of Eng Chick Wong. The learned Single Judge therefore came to the conclusion that the firm cannot claim status of a protected tenant directly under the landlord on the provisions of Section 13(2) of the Act of 1950. (Para 18)
Aggrieved by the judgment of the learned Single judge the firm preferred an appeal to Division bench. The Division bench by the impugned judgment delivered on 4.8.2000 allowed the appeal of the firm and set aside the judgment of the learned Single Judge. After examining the entire facts and events in the long course of litigation, the Division Bench came to the conclusion that by operation of law Eng Chick Wong either as the proprietorship concern or as a Partner of Partnership firm became a tenant directly under Chitpur Golabari Co. (original landlord). It further held that the landlord would be entitled to bring a suit for eviction against the firm on the ground that as sub-tenant, it was inducted unlawfully by the proprietor of Waldrof Restaurant who had become tenant directly under the Act of 1950 but recourse to execution proceedings was impermissible in law. (Para 19)
The Division Bench of the High Court has wrongly assumed creation of sub-tenancy by the proprietor in favour of the partnership firm. The erstwhile proprietor of the business himself became one of the partners of the firm. Such an act on his part was sub-letting or not would depend upon the terms of the partnership deeds, which were withheld from disclosure to the court despite a lawful demand therefor. Mere carrying on by the tenant a partnership business as partner in the leased premises, no doubt, does not per se amount to sub-letting unless it is shown that he withdrew his control of the leased premises and parted with the possession of the property and thereby surrendered his individual tenancy rights in favour of the partnership firm. (Para 38)
Held (after discussion) : Thus we find that the tenant- Allenberry & Co. has surrendered the tenancy and vacated the leased premises. Eng Chick Wong the sole proprietor of the proprietary concern Waldorf Restaurant, to whom the premises were sublet prior to the surrender of tenancy has also vacated the premises and left India. The possession of the leased premises has been left with the firm through its partners who must vacate the premises on extinguishment of the rights of the tenant and the sub-tenant. Consequently, we allow these appeals. The impugned judgment dated 4.8.2000 of the Division Bench of the High Court of Calcutta is set aside and that of the learned Single Judge dated 20.4.2000 is restored. Since respondent No. 1 has dragged on the litigation for such a long period, the appellant would also be entitled to full costs incurred in courts below and in this Court. The counsel fee shall be allowed as per rules. (Paras 42 & 43)
JUDGMENT
Dharmadhikari J.-Leave to appeal is granted.
2. Long period of more than 45 years spent in this litigation amply demonstrates how clever parties by adopting all conceivable tactics succeed in delaying justice and thus bring disrepute to the justice delivery system.
3. The appellants (who will hereinafter be referred to as the landlord ) have acquired from the original owner title to building No.2 of which ground floor, area 2537 Sq. Ft in Park Street, Calcutta are the leased premises in dispute between the parties before us. The previous owner of the premises obtained a compromise decree of eviction on 27.4.1955 against Allenberry & Company limited (respondent No.3) which was the tenant in the leased premises. Presently in the said premises, a well-known restaurant in the trade name of "Waldorf Restaurant" is being run by registered partnership firm of that name (Respondent No. 1 herein and hereinafter shortly referred to as the firm ).
4. Under the terms of the compromise decree, the tenant -Allenberry & Co. (respondent No.3 herein), has vacated the suit premises. The firm in assertion of its claim to the status of sub-tenant has been successful for the past 45 years in resisting the execution of the decree against it.
5. The main question involved in these appeals is whether the respondent firm can claim status of sub-tenant and seek protection against eviction in execution of the compromise decree obtained against the tenant, under the provision of the West Bengal Premises Rent Control (temporary provisions) Act 1950 (hereinafter shortly referred to as the Act of 1950).
6. Shorn of unnecessary details of long drawn litigation between the parties, only the facts relevant for decision of the legal question are required to be stated.
7. The suit premises presently in use for running Waldorf Restaurant originally belonged to Chitpur Golabari Company Limited (respondent No.2 herein). Between the period 1.1.1939 to 31.12.1951 Allenberry & Company (respondent No.3 herein) was the contractual tenant of the original landlord. On 12.8.1953 Allenberry & Co. (hereinafter shortly referred to as the tenant) gave a formal notice to the landlord expressing its intention to surrender the tenancy and vacate the leased premises by 31.8.1953. The service of notice to the landlord for surrender of the leased premises resulted in law in determination of the lease under Section 106 read with Section 111 of the Transfer of Property Act. This legal position has been finally settled by the Judgment of this Court in the case of Calcutta Credit Corporation Ltd. vs. Happy Homes Private Limited [1968 (2) SCR 20]. That was a case in respect of other portion of the same building which was also in occupation of original tenant and was part of the leased premises which were surrendered by the tenant.
8. Despite the service of formal notice of surrender of tenancy by the tenant, vacant possession of the suit premises was not handed over to the landlord. The landlord, therefore, instituted suit No-1645 of 1954 on 28.5.1954 for eviction of the tenant. The said suit was decreed on 27.4.1955 in terms of a compromise under which the tenant vacated the suit premises and reserved liberty to the landlord to take necessary legal steps for evicting sub-tenants who had been inducted by the tenant. The three sub-tenants named in the compromise decree were Chowranghee Sales Bureau Pvt. Ltd., Happy Homes Pvt. Ltd. and Waldorf Restaurant (respondent No.1 herein).
9. After obtaining the compromise decree of eviction against the tenant, the landlord instituted three separate suits for eviction against the above-named three sub-tenants. Separate decrees of eviction were obtained against the two sub-tenants viz. Chowranghee Sales Pvt. Ltd. and Happy Home Pvt. Ltd. The litigation in the case of Happy Homes Pvt. Ltd. came up to this Court and the decree obtained by the landlord against it, was maintained by the decision in the case of Happy Homes Pvt. Ltd. (supra). T
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