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2003 Supreme(SC) 735
2003(5) Supreme 337
SUPREME COURT OF INDIA
(From Bombay High Court)
Shivaraj V. Patil and D.M. Dharmadhikari, JJ.
Prabodh N. Shah -Appellant
versus
S.B.I. & Ors. -Respondents
Civil Appeal No. 3908 of 1999
Decided on 8-8-2003
Counsel for the Parties :
For the Appellant : Mahendra Anand, Sr. Advocate, D.K. Shah, Ms. Indu Malhotra and Ms. Ruchi Khurana, Advocates.
For the Respondents : Muneesh Malhotra, Parveen Sharma, Advocate for Tarun Johri, Advocates.
IMPORTANT POINT
A person claiming to be a tenant is entitled to a hearing on his claim even though in a summary way by the Court in the proceedings of recovery suit taken pursuant to the report of Court Receiver recommending enhancement of occupation charges of premises.
Headnote:Civil Procedure Code, 1908-Order 40-Appointment of receiver-Banks filed suit for recovery of loan advanced to respondent No. 4-Court receiver appointed on properties including shop in question in which appellant claimed to have been inducted by respondent No. 4 ten years ago on monthly rent of Rs. 2500/- -Court receiver after hearing appellant and other occupants of premises submitted report recommending enhancement of occupation charges of premises of appellant to Rs. 12,500/- p.m. relying upon valuation report-Chamber summons for setting aside directions of Court receiver was rejected upholding enhancement of occupation charges-Appeal-Dispute concerning appellant deserved to be remitted to High Court for a fresh determination, may be in a summary way, on the claim of appellant to the status of tenant in premises in question.
Held : It is undeniable that in the order dated 3.11.1995 of the Division Bench passed in appeal appointing a Court Receiver, the statement of the defendants was recorded that the appellant is in occupation of Shop No. 828 as a licensee/tenant since nearly ten years. The Division Bench summarily rejected such claim of the appellant being tenant without any further enquiry or investigation. The appellant was not a party to the suit before the single Judge or the appeal before the Division Bench. (Para 12)
Further held : From the resume of the above facts, it is clear that neither before the Division Bench when it passed the order dated 3.11.1995 nor before the learned single Judge in the course of decision of the Chamber Summons pursuant to the Court Receiver s report, the appellant had a fair chance of establishing even prima facie in a summary way, his status in the premises as tenant with right of being protected against increase of rent under the provisions of the Bombay Rent Act. The learned single Judge was clearly wrong in stating in the impugned order dated 4.8.1998 that the order of the Division Bench dated 3.11.1995 was binding on the appellant and the court could not go beyond the said order and the observation made therein. As has been found above, the Division Bench at the time of summarily rejecting by its order dated 3.11.1995 the defendants claim of the occupation of the appellant as tenant did not notice or hear the tenant in the appeal. The order of the Division Bench, therefore, could not have been held to be binding on the appellant to conclusively negate his claim to the status of tenant to the premises in question. The learned single Judge was also in error in holding that such a claim of the appellant to the status of tenant was not liable to be considered as he had not filed any suit for declaration of his right and status. (Para 15)
JUDGMENT
Dharmadhikari, J.-The appellant claims to be in occupation as tenant of premises described as Shop No. 828 in Parekh Market, Opera House, Bombay. M/s. Nikhil Diamonds [Respondent No. 4 herein] admittedly owns amongst others the said premises in the market.
2. The three Banks [respondents No. 1, 2 and 3 herein] filed Suit No. 607 of 1995 in High Court of Bombay on its Original Side for recovery of loans advanced by them to respondent No. 4 and its partners [respondents No. 5 to 11].
3. The Banks as plaintiffs in the said Suit sought appointment of Court Receiver under Order 40 Rule 1 Code of Civil Procedure (hereinafter referred to as the Code for short) for safe custody and proper management of the properties of the defendants. The Single Judge of the High Court rejected the prayer. In appeal the division bench of the Bombay High Court by its Order dated 3.11.1995, accepted the prayer of the Banks and appointed a Court Receiver on the properties which include the premises in question.
4. M/s. Nikhil Diamonds and their partners as owners of the building and the premises therein through their counsel appearing before the division bench stated that premises described as Shop No. 828 situated at Parekh Market, Opera House, Bombay, was in possession of the appellant as a licensee/tenant since nearly ten years . The division bench while passing the order appointing Court Receiver, expressed surprise how third parties got into possession of the premises. The division bench then recorded the statement of Respondent Nos. 4 to 11 and directed the Court Receiver that if he would find third parties in possession of the premises of the building, he would appoint them as agents on usual terms including security and compensation. The relevant part of the order dated 3.11.1995 of the division bench, deserves to be reproduced which reads as under :-
"In this usual Bank suit we find that the liability is virtually undisputed, which runs into more than Rs. 8.00 crores. In these circumstances, the appointment of Receiver at least in respect of the properties mortgaged or agreed to be mortgaged must follow. We, therefore, appoint the Court Receiver, High Court, Bombay, as the receiver in respect of the properties described in Exhibit "C-1" and Exhibit "G" with a further direction to appoint the 1st Defendant as the agent in respect of the said properties provided the 1st Defendant is willing to accept the agency on usual terms, but without security.
During the course of arguments Mr. Mehta submitted that Shop No. 826 is in possession of P. Manish & Co. and Shop No. 828 is in possession of one Mr. P.N. Shah. When we asked Mr. Mehta as to how these two parties have come in occupation of the premises, Mr. Mehta explained that as far as Shop No. 826 is concerned, there is same oral understanding of exchange between P. Manish & Co., and so far as Shop No. 828 is concerned, Mr. Shah is a licensee/tenant since nearly 10 years, we are not at all satisfied with the explanation of Mr. Mehta. In case the Receiver finds third parties in possession, it will be open for the Receiver to appoint those third parties as agents on usual terms including security and compensation.
[Portion highlighted for emphasis]
5. Pursuant to the above order the Court Receiver took symbolic possession of the properties on 27.3.1996. After hearing the appellant and other occupants of the premises he submitted a report to the Court recommending enhancement of the occupation charges of the premises in possession of the appellant to Rs. 12,500/- per month. For the purpose of fixing the above amount as occupation charges or royalty, the Court Receiver relied on the Valuation Report submitted by the Valuer.
6. The present appellant along with other affected occupants filed Chamber Summons for setting aside the directions of the Court Receiver made on 12.5.1998. The appellant s contention before the Court was that he being statutory tenant on a rent of Rs. 2500/- per month and fixat
