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IN THE HIGH COURT OF BOMBAY
R.D. Dhanuka, J.
Purshottam Shankar Shetye - Appellant
Versus
Abhay Shridhar Shetye - Respondent
First Appeal No. 1791 of 2007
Decided On : 19-05-2020
PRESIDENCY SMALL CAUSE COURTS ACT, 1882 - SECTION 41 - JURISDICTION - SUIT FOR RECOVERY OF POSSESSION OF BUSINESS PREMISES - CONDUCTING AGREEMENT - LICENSE - MAHARASHTRA RENT CONTROL ACT, 1999 - SECTION 7(5) - LICENSE - DEFINITION - APPLICABILITY - BOMBAY RENT ACT, 1947 - SECTION 5(4A) - LICENSE - DEFINITION - APPLICABILITY - SMALL CAUSES COURT - JURISDICTION - PECUNIARY JURISDICTION - VALUATION OF SUIT - NET RACK RENT - FULL BENCH JUDGMENT OF BOMBAY HIGH COURT IN PREM RATAN VOHARA V/S. LALIT KUMAR DAYALJI KAKHANI - APPLICATION.
Fact of the Case:
The plaintiff, the widow of the original respondent, filed a suit in the Bombay City Civil Court seeking recovery of business premises and other reliefs. The defendants, the legal heirs of the original defendant, contested the suit, claiming that they were tenants of the premises and that the suit was not maintainable in the City Civil Court due to lack of jurisdiction. The plaintiff contended that the defendants were trespassers and had no right, title, or interest in the premises after the expiry of the conducting agreement.
Finding of the Court:
The court held that the suit was maintainable in the City Civil Court and that the defendants were trespassers. The court found that the defendants had failed to prove their claim of tenancy and that the conducting agreement between the parties did not create a license or sub-tenancy in their favor. The court also held that the suit was properly valued and that the City Civil Court had pecuniary jurisdiction to try the suit.
Issues: 1. Whether the suit was maintainable in the City Civil Court or the Small Causes Court? 2. Whether the defendants were tenants of the premises or trespassers? 3. Whether the conducting agreement between the parties created a license or sub-tenancy in favor of the defendants? 4. Whether the suit was properly valued and the City Civil Court had pecuniary jurisdiction to try the suit?
Ratio Decidendi: 1. The suit was maintainable in the City Civil Court because it was not a suit between a landlord and tenant or a licensor and licensee, and the value of the suit claim exceeded the pecuniary jurisdiction of the Small Causes Court. 2. The defendants were trespassers because they failed to prove their claim of tenancy and the conducting agreement between the parties did not create a license or sub-tenancy in their favor. 3. The conducting agreement between the parties did not create a license or sub-tenancy in favor of the defendants because the definition of "licensee" under Section 7(5) of the Maharashtra Rent Control Act, 1999, and Section 5(4A) of the Bombay Rent Act, 1947, excludes a person conducting a running business belonging to the licensor. 4. The suit was properly valued and the City Civil Court had pecuniary jurisdiction to try the suit because the plaintiff had valued the suit on the basis of the net rack rent of the premises, as per the principles laid down by the Full Bench of the Bombay High Court in Prem Ratan Vohara v/s. Lalit Kumar Dayalji Kakhani.
Final Decision: The court dismissed the defendants' appeal and upheld the judgment and decree of the trial court. The defendants were directed to deliver possession of the business and premises to the plaintiff within eight weeks from the date of the judgment.
JUDGMENT
R. D. Dhanuka, J. - By this First Appeal, the appellants (original defendants) have impugned the judgment and order dated 20th March, 2007 passed by the Bombay City Civil Court at Bombay, thereby decreeing the suit filed by the respondent no.1 (original plaintiff) inter-alia praying for recovery of the business premises and for other reliefs and directing the appellants to deliver the said business premises described in the plaint. Some of the relevant facts for the purpose of deciding this First Appeal are as under :-
2. Mrs. Malati Rajaram Parshetye was the original respondent no.1 and was the original plaintiff before the Trial Court whereas the Mr. Purshottam Shankar Shetye was the original defendant. Upon demise of the original defendant his legal heirs were brought on record. It was the case of the respondent no.1 that she is the widow of late Shri Rajaram Appa Parshetye who expired on 26th March, 1967. Her late husband was carrying on business of selling Pan, Bidi and Cigarette etc. in the name and style of "Masrice Bidi Works" as owner thereof at Shop No.5, admeasuring 9'x15', Ground Floor, Choksi Building, Ranade Road, Dadar, Mumbai - 400 028 (hereinafter referred to as "the suit premises and its business" for short). The husband of the respondent no.1 was the tenant of the suit premises. It is the case of the respondent no.1 that her tenancy right in the suit premises are still intact and subsisting after demise of her husband. Parties in this judgment are referred to as per their original status before the trial court.
3. It was the case of the plaintiff that in the year 1965, her late husband was suffering from illness and was not able to run his business personally in the suit premises and thus decided to give his business for conducting to some needy and fit person who was able to conduct the said business on the basis of Conducting Agreement for the period of 11 months only.
4. It was the case of the plaintiff that Mr. Purshottam Shankar Shetye the original defendant had approached her husband and requested him for giving the said business being run in the suit premises for conducting on the basis of a Conducting Agreement. The late husband of the plaintiff accepted the said request of the original defendant and told him to enter into a Conducting Agreement for a period of 11 months. Late husband of the plaintiff and the original defendant entered into a Conducting Agreement on 2nd January, 1966 for a period of 11 months commencing from 2nd January, 1966 to 1st December, 1966. It was the case of the plaintiff that the original defendant started conducing the business of the husband of the paintiff as per the terms and conditions recorded in the said Conducting Agreement dated 2nd January, 1966. The original defendant handed over the possession of the said business run in the said suit premises to the husband of the plaintiff after conducting period of 11 months was over on 2nd December, 1966.
5. The husband of the plaintiff and the original defendant executed another Conducting Agreement for a period of 11 months commencing from 1st July, 1967 to 31st May, 1968 in respect of the said business being run in the said suit premises. On 10th September, 1970, the husband of the plaintiff and the original defendant entered into another Conducting Agreement for conducting the said business in the said suit premises for the period of 9 months. Last Conducting Agreement executed between the plaintiff and the original defendant was for the period of 11 months commencing from 1st March, 1986 to 31st January, 1987.
6. It was the case of the plaintiff that the original defendant had handed over possession of the said business to the plaintiff. The plaintiff thereafter declined to give her business for conducting to the original defendant. The plaintiff however considered the request of the original defendant subsequently and told him to prepare a Conducting Agreement once more and for the last time commencing from 5th
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