1982 Supreme(MP) 198

High Court Of Madhya Pradesh
Faizanuddin, J.
FIRM DURGA PRASAD MAGNIRAM - Appellant
Versus
GANESH PRASAD - Respondents
First Appeal 173 Of 1975
Decided On : 03/15/1982

An agreement of subletting entered into in contravention of the statutory provisions prohibiting subletting is void from its inception. The sub-tenant is liable to pay compensation to the plaintiff for use and occupation of the premises obtained by the defendant from the plaintiff under Section 65 of the Contract Act. The period taken in the challenge to the court-sale can be excluded for purposes of limitation of the suit under Section 15 of the Limitation Act, 1963.

Headnote:

SUBLETTING - VOID AGREEMENT - RENT RECOVERY - LIMITATION - C. P. AND BERAR LETTING OF HOUSE AND RENT CONTROL ORDER, 1949, SECTION 12-A - M. P. ACCOMMODATION CONTROL ACT, 1955, SECTIONS 3, 4 - M. P. ACCOMMODATION CONTROL ACT, 1961, SECTION 12 - CONTRACT ACT, 1872, SECTION 65 - LIMITATION ACT, 1963, SECTION 15 - An agreement of subletting entered into in contravention of the statutory provisions prohibiting subletting is void from its inception. - The sub-tenant is liable to pay compensation to the plaintiff for use and occupation of the premises obtained by the defendant from the plaintiff under Section 65 of the Contract Act. - The period taken in the challenge to the court-sale can be excluded for purposes of limitation of the suit under Section 15 of the Limitation Act, 1963.

Fact of the Case:

Plaintiff-firm, as a sub-tenant, occupied a portion of the Bhavan owned by Firm Durgaprasad Mukharya. In execution of a decree, the Bhavan was sold in court auction on 7-10-1959 and purchased jointly by Smt. Laxmi Bai (wife of defendant) and one Ramcharan. The sale was confirmed on 1-1-1962, and the sale certificate was also issued on 25-7-1962. The said auction sale was set aside by the High Court on 27-2-1969 at the instance of the judgment-debtor, Firm Durga Prasad. Plaintiff's case was that it had obtained the Bhavan on a monthly rental of Rs. 200/- from its owners and sublet only a part of it to the defendant-respondent on a monthly rent of Rs. 100/- with implied permission of the owners/landlords. The defendant paid rent of the said portion to the plaintiff up to the year 1960 but thereafter failed to pay the same. Plaintiff claimed that its right to recover the rent from the defendant was stayed till the date the auction sale of the Bhavan was set aside by the High Court, i.e. up to 27-2-1969, and this right to recover the rent from the defendant was available only on 10-9-1969 when the Supreme Court also refused to grant special leave to appeal against the order dated 27-2-1969, passed by the High Court, in Misc. Civil Appeal No. 273 of 1968, setting aside the auction sale. Plaintiff further averred that the defendant was in arrears of rent with effect from Oct. 1961 to Feb. 1972 for 125 months out of which the defendant paid only Rs. 565-27 and after adjusting the same, a sum of Rs, 11,934-73 was still due as arrears of rent against the defendant up to the date of institution of the suit. The defendant denied all the plaint-allegations except the facts stated in para No. 2 above. The defendant denied that the plaintiff-firm had obtained the Bhavan in question on a monthly rental of Rs. 200/- or that he was inducted as a sub-tenant by the plaintiff in a portion of the said Bhavan. The defendant also denied that he paid any rent to the plaintiff up to the year 1960. He also refuted the allegation that his wife, Smt. Laxmi Bai Dube was a Benami purchaser for and on his behalf. The defendant denied that the plaintiff was legally entitled to exclusion of the period from 7-10-1959 to 10-9-1969 in computing the limitation for the suit because after confirmation of sale, there was no stay of plaintiff's right to recover rent from the defendant and the defendant was not a party to Misc. Civil Appeal No. 273 of 1968, and therefore, the suit was barred by limitation. The defendant further took the plea that unless the plaintiff pleaded and proved the express permission of its landlord for subletting, the plea of subtenancy set up by the plaintiff would be unlawful and void under the provisions of Clause 12-A of the Central Provinces and Berar Letting of House and Rent Control Order, 1949, as well as under Section 23 of the Contract Act. The defendant further contended that the plaintiff had itself disowned the status of defendant as sub-tenant in Civil Suit No. 11-A of 1961 instituted by the plaintiff's landlords of that suit for eviction of the present plaintiff-appellant on the ground that the plaintiff-firm had sublet a portion to the present defendant, and therefore, the plaintiff had no right to contend that the defendant was its sub-tenant and claim rent on that account as the plaintiff was now estopped from so contending.

Finding of the Court:

1. The defendant was a sub-tenant in respect of the portion of the Bhavan in question. 2. The agreement of subletting was void from its inception being in contravention of the statutory provisions which prohibited subletting. 3. The defendant was liable to pay compensation to the plaintiff for use and occupation of the premises obtained by the defendant from the plaintiff. 4. The period taken in the challenge to the court-sale should be excluded for purposes of limitation of the suit. 5. The plaintiff was entitled to claim mesne profits for three years only next before the institution of the suit.

Issues: 1. Whether in the absence of express or written permission, subletting of the portion of the Bhavan by the plaintiff to the defendant in 1954 was void and contrary to law then in force? 2. Whether the defendant sub-tenant was obliged in equity to pay rent to the plaintiff from whom be obtained the premises even if the inter se relationship between them as tenant and sub-tenant was void and contrary to the provisions of law? 3. Whether under the facts and circumstances of the case, the plaintiff was entitled to exclusion of the period from 7-10-1959 to 109-1969 under the provisions of the Limitation Act, 1963, and therefore, the suit for arrears of rent from Oct. 1961 to Feb. 1972 was not barred by time?

Ratio Decidendi: 1. An agreement of subletting entered into in contravention of the statutory provisions prohibiting subletting is void from its inception. 2. The sub-tenant is liable to pay compensation to the plaintiff for use and occupation of the premises obtained by the defendant from the plaintiff under Section 65 of the Contract Act. 3. The period taken in the challenge to the court-sale can be excluded for purposes of limitation of the suit under Section 15 of the Limitation Act, 1963.

Final Decision: Appeal partly allowed. Judgment and decree of the trial court set aside. Plaintiff-appellant's suit decreed for Rs. 3,600 as arrears of mesne profits for the period of 3 years next before the institution of the suit. Defendant to bear his own costs and proportionate costs of the plaintiff appellant throughout.