IN THE HIGH COURT OF JUDICATURE AT MADRAS
Mr. P.V. Rajamannar, Chief Justice and Mr. Justice Mack, XJ.
K. Devarajulu Naidu
Versus
C. Ethirajavalli Thayaramma, by power-of-attorney agent C. Ranganayakalu Chetty
C.M.P. No. 1450 of 1949.
Decided On : 12 July 1949
The Chief Justice.-This application for the issue of a writ of certiorari arises out of a petition filed by the first respondent before the Rent Controller, Madras, for eviction of three persons, of whon the petitioner before us is one. The first respondent is the owner of house No. 210, Govindappa Naicken Street, George Town, Madras. It is common ground that this house was let by the first respondent to a firm called “Devarajulu Naidu & Co.” which consisted of these three persons as partners. This partnership firm was dissolved sometime in 1943 and thereafter no fresh business was done, but the affairs of the partnership were wound up. By 14th November, 1946, the winding up was completed and accounts were finally settled. Meanwhile on 15th March, 1944, the first respondent purported to terminate the tenancy by notice to quit and followed up the notice with a suit for eviction in the Court of Small Causes (Suit No. 252 of 1944). That suit was dismissed on 16th August, 1944 and the first respondent was directed to obtain relief from the Rent Controller. On 9th December, 1946, after the Madras Buildings (Lease and Control) Act of 1946 came into force, an application was filed by the first respondent against the three erstwhile partners for eviction. The main grounds on which eviction was sought were (i) that the three tenants had sub-let the premises to another firm which consisted of the petitioner before us and two others, not parties to the application and (ii) that the premises were being used for a purpose other than that for which they were leased.
The Rent Controller dismissed the application. He held that it had not been conclusively proved that the petitioner before us was carrying on a new business with other partners and even so, such business commenced long before 1st October, 1946, when the present Act came into force. On appeal the Third Judge of the Court of Small Cause reversed the decision of the Rent Controller and directed eviction of all the three persons against whom the application had been filed. So far as we can gather from his order, the learned Judge’s findings are that after the termination of the tenancy by the first respondent the three partners should be deemed to have continued as tenants both individually and collectively and the firm must be deemed to have continued till 14th November, 1946, when it was finally wound up, that between 1943 and November 1946 the petitioner before us was in sole charge of the dissolution of the firm and that simultaneously he started a business on the said premises in his own name on 9th December, 1945. On these findings of fact he arrived at the conclusion that in law it must be held that the three partners sub-let the premises to the petitioner before us in his individual capacity for his separate business; to use his own words
“the petitioner (landlord) was therefore justified in treating the respondents as collectively the tenant of the property and the first respondent (petitioner here) as a sub-tenant from and after 14th November, 1946.”
In our opinion the learned Judge fell into an obvious error of law in arriving at this conclusion. The position was shortly this. The original tenancy was in favour of three persons who were partners in a firm. After the dissolution of the firm, one of the partners was allowed to wind up the affairs of the partnership and thereafter was allowed to use the premises for his sole business. This act on the part of the two partners other than the petitioner cannot amount to a transfer or sub-letting of the premises to the petitioner. It is true that the Courts in England have taken up an extreme view that even when one of two partners after the dissolution of the partnership assigns to the other partner the interest of the partnership in premises which had been taken on lease by the partnership, it would amount to a breach of the covenant prohibiting an assignment of the lease without the consent of the lessor. (See Varley v.
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