What amounts to carrying on business.

The petitioner is the owner of premises in Bazaar Street, Salem Town, in which two shops bearing Nos. 368 and 369 are located. These two shops are in the possession of the respondent. The petitioner sought to evict the respondent from the premises on the ground that he wanted them to carry on a business of his own. The accommodation controller dismissed the application. The appeal which the petitioner filed before the Subordinate Judge and the revision petition which he filed before the District Judge both failed. He has therefore come to this Court.

The petitioner stated that he wanted the premises in order that he might trade in mill cloth in Salem. He also stated that he has obtained a licence for the purpose from the appropriate authorities. The case of the respondent was that the petitioner was not carrying on any business and that his application was not bona fide, since he had alternative accommodation in another part of the building, access to which could be had from a lane taking off from the Bazaar Road. Mr. Ramaswami Ayyangar, the learned advocate for the respondent, contended that as the petitioner has only obtained a licence for trading in cloth, he cannot be said to be carrying on a business, and that it is only if he is carrying on a business that he can call to his aid section 7 (3) (a) (iii) of Madras Act XXV of 1949. On this point there are three decisions: In Kesavan Nair v. Babu Naidu1, Ramaswami,‘J. held that where a person has erected a building for a factory, shifted machinery to the place and applied for licence to the concerned authorities, he can be deemed to be a person carrying on business and that it would not be correct to say that he only intends to carry on business. In Nataraja Achari v. Balasubramaniam2, Panchapakesa Ayyar, J. observed:

"It is also settled now that carrying on a business need not necessarily mean that he has begun the trade vigorously ; it is enough if he had made all the preparations. Just as swimming requires water, carrying on business requires suitable premises. As it is clear that there are no adequate premises for the respondent to carry on his grain-trade, unless he gets both the halves of these tiny premises it is enough for him to prove that he has got a licence for the grain-trade and has made other necessary preparations for carrying on the grain-trade."

The question has been comprehensively examined by Viswanatha Sastri, J., in Venkataswami & Sons v. Virabadraswami3. He observed:

"The phrase ‘carrying on business’ has no fixed connotation and its meaning and effect have to be ascertained from the context in which it is used, the nature of the business and the transaction incidental to it. If a dealer carrying on wholesale business in cloth has also obtained the necessary license and quota for carrying on a retail business in cloth and all that remains for him is to remove the cloth from his wholesale shop into the retail shop and begin to sell the cloth, he has started his business operations. There is no yardstick by which we can measure the range of activities necessary to constitute the carrying on of a business. A business may take some time for its being organised and set on foot as a trading venture. When companies are formed for the purpose of carrying on business, there is often a considerable interval of time between the formation and the registration of the company and the actual commencement of the business for which it was formed. In business as in professions, there are initial stages and periods when there is very little activity visible to out-siders but nevertheless, the business or profession is regarded as being carried on. The contention of the respondent would lead to this result that a wholesale dealer in cloth who wants to carry on retail cloth business in another shop as required by the rules would have to take out a shop on rent for some time, stock his goods there and sell them in the rented premises before he can claim to get possessio