IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 18.08.2010 Coram: THE HONOURABLE MR.JUSTICE G.RAJASURIA C.R.P.(NPD).Nos.889 and 890 of 2006 1. C.Venkatesh 2. M.V.Vivekanand 3. Vidya Balachander .... Petitioners in both the petitions (Land Lords) vs. M/s.Vel Beds rep.by its Partner Kandasami Coimbatore ... Respondent in CRP NPD No.889 of 2006 (Tenant) 1. M/s.Tip Top Southern Bonanza rep.by its partner Mr.Md.Kasim 2. B.Md.Kasim 3. Mrs.Rahmath Kasim 4. M/s.Vel Beds rep.by its partner S.Kandasamy 5. S.Kandasamy 6. P.A.Shanmugam ... Respondents in CRP NPD. No.890 of 2006 (Tenants) PRAYER: Civil revision petitions filed against the common judgment and decrees dated 19.12.2005 passed by the learned Principal Subordinate Judge, (Rent Control Appellate Authority), Coimbatore, in R.C.A.Nos.70 and 71 of 2005 respectively in confirming the fair and decreetal order dated 05.04.2005 passed by the learned District Munsif (Rent Controller), Coimbatore in RCOP Nos.102 and 111 of 2003 respectively. https://hcservices.ecourts.gov.in/hcservices/ For Petitioners : Mr.AR.L.Sundaresan, Senior counsel in both the for M/s.AL.Gandhimathi petitions For Respondent : Mr.M.Md.Ibrahim Ali in CRP NPD No. 889 of 2006 and for RR4 to 6 in CRP NPD No.890 of 2006 For R1 to R3 : No appearance in CRP NPD No. 890 of 2006 COMMON ORDER Animadverting upon the common judgment and decrees dated 19.12.2005 passed by the learned Principal Subordinate Judge, (Rent Control Appellate Authority), Coimbatore, in R.C.A.Nos.70 and 71 of 2005 in confirming the fair and decreetal orders dated 05.04.2005 passed by the learned District Munsif (Rent Controller), Coimbatore in RCOP Nos.102 and 111 of 2003, these two civil revision petitions are focussed by the landlords. 2. Broadly but briefly, narratively but precisely, the relevant facts absolutely necessary and germane for the disposal of these two revision petitions would run thus: (i) The revision petitioners/landlords filed the RCOP No.111 of 2003 seeking eviction of the respondents/tenants, initially on the grounds of sub-letting and change of user by invoking Sections 10(2) (ii)(a) and 10(2)(ii)(b) of the Tamil Nadu Buildings Lease and Rent Control Act (hereinafter referred to as the 'Act' for short) and subsequently got the RCOP amended by incorporating the additional two grounds, viz., default in payment of rent and act of waste by invoking Sections 10(2)(i), and 10(2)(iii) of the Act. The matter was contested. (ii) Whereas the respondents/tenants filed the RCOP No.102 of 2003 under Section 8(5) of the Act seeking permission to deposit the rent in court. (iii) During the joint enquiry, on the side of the revision petitioners/landlords, P.Ws.1 to 3 were examined and Exs.P1 to P30 were marked. On the side of the respondents/tenants, R.Ws.1 and 2 were examined and Exs.R1 to R12 were marked and the Court documents Exs.C1 and C2 also were marked. https://hcservices.ecourts.gov.in/hcservices/ (iv) Ultimately, the Rent controller allowed the RCOP No.102 of 2003 filed by the tenants for deposit of rent in court and dismissed the RCOP No.111 of 2003 filed by the landlords rejecting all the grounds. (v) Aggrieved by the orders of the Rent Controller, the landlords preferred appeals in RCA.Nos.70 and 71 of 2005, for nothing but to be dismissed. (vi) Being aggrieved by and dissatisfied with the orders of both the courts below, these two revisions have been filed by the landlords more on less on similar grounds. 3. Heard both sides. 4. The learned senior counsel for the revision petitioners, placing reliance on the grounds of revision would develop his arguments, the warp and woof of them would run thus: (i) Both the courts below fell into error in ignoring the factum of the premises having been sub-let by the original partners, viz.,B.Md.Kassim and Mrs.Rahmath Kasim (R2 and R3 herein) in favour of two persons viz., Kandasamy and Shanmugam (R5 and R6 herein). Even as per Ex.R7, a sum of Rs.20 lakhs was paid by the said Kandasamy and Shanmugam in favour of the original partners, which demonstrates that they sold their business in favour of the aforesaid two persons and thereby it tantamounts to sub-letting the demised premises. But both the courts below failed to address themselves to the relevant facts and apply the correct proposition of law and accordingly, their findings are perverse. (ii) The tenant himself invoked Section 8(5) of the Act and sought permission to deposit the rent. Whereupon , the Rent Controller ordered that petition with a direction that a sum of Rs.35,125/- per month should be paid, taking into account the subsequent development to the effect that the landlords filed the RCOP for fixation of rent and in that the Rent Controller fixed the fair rent in a sum of Rs.35,125/- per month. In fact as against such fixation of fair rent, appeal was filed only by the landlords for enhancement of the rent fixed by the Rent Controller. In the meantime, the tenants accepted the fixation of fair rent i.e.,Rs.35,125/- fixed as fair rent per month and for about 10 months, they were also depositing the same in court. Subsequently, they once again committed default in paying the rent and that they were not even regular in paying the sum of Rs.8,000/- per month as earlier agreed between the parties. (iii) As such, there were ups and downs in the quantum of rent paid by them in addition to they being irregular in making payment of https://hcservices.ecourts.gov.in/hcservices/ the same and it clearly amounted to willful default. But the courts below failed to take into account those features and committed error in holding as though there was no willful default in paying rent by the tenants. The Appellate authority assumed as though there were huge advance amounts available with the landlords and that consequently, no default in payment of rent could be attributed as against the tenants. Without giving any calculation as to how much alleged amount of advance was adjusted towards arrears of rent etc. and that too in the absence of when there were no pleadings relating to advance and adjustment of advance, the appellate authority decided erroneously the appeal. (iv) Even though the partnership was earlier doing admittedly the business in fancy goods, subsequently, they unauthorizedly switched over to doing business in pillows and beds and that amounts to change in user warranting interference of this court. (v) But the Rent Controller and the Appellate Authority in their findings, felt that there was no change in user. (vi) The tenants also unauthorizedly and highhandedly removed the very stair case to the mezzanine floor in the demised premises and it was a gross act of waste, which lowered the value as well as the utility of the building. But the courts below simply held as though removal of the stair case in no way lowered the value of the building or dwarfed the utility of the building. As such, the findings of both the courts below are totally against the well established principles of law. (vii) The learned senior counsel for the landlords also would submit that even pending litigation the rents were not paid regularly and that would exemplify the conduct of the tenant in committing default in payment of rent. Accordingly, the learned senior counsel for the landlords would pray for allowing both these revisions. 5. Per contra, in an attempt to torpedo and pulverise the arguments/contentions as put forth on the side of the landlords, the learned counsel for the respondents/tenants would advance his arguments, which could tersely and briefly be set out thus: (a) It is an admitted fact that the landlords even though very much relied on the original lease agreement, which emerged between the landlords and the tenants, they had not chosen to file the same before the court and mark it due to the obvious reasons that had they produced the original lease agreement then that would have exposed the landlords. https://hcservices.ecourts.gov.in/hcservices/ (b) It is an admitted fact that the landlords and the tenant viz., the original partnership under the name and style M/s.Tip Top Southern Bonanza agreed that the tenant could change it partners and the only requirement was that the landlords should be put on notice of such change and no prior permission or consent is contemplated under the lease agreement. When such is the position, mere change in the constitution of the partnership by new partners entering into the partnership and the old partners retiring, would not amount to sub- letting. Mere payment of Rs.20 lakhs by the new partners in favour of the old partners would not enure to the benefit of the landlords to argue that there was sale of the business itself . (c )From 1976 onwards, the original partners viz., R2 and R3 started the business in fancy goods and they had been doing it for several decades and only in recognition of their good effort and by way of settling their accounts the said sum was paid and not by way of purchasing their business by the new partners. In such a case, the arguments as put forth on the side of the landlords are untenable. (d) Even though admittedly, the learned senior counsel for the landlords might try to project as though there was default in payment of rent by the tenants, there is nothing to display and demonstrate that there was wilful default in paying the earlier agreed rent of Rs.8,000/- per month. (e) During the pendency of the RCOP No.111 of 2003, even though the additional ground of willful default was got incorporated by the landlords, actually there was no wilful default at all. In fact, in the typed set of papers, the calculation details relating to payment of rent into court do not reflect the true picture and there are also mistakes in it. However, the tenants did not commit any default at all in paying the rents anterior to the filing of the RCOP. After the fixation of fair rent by the Rent Controller, the tenants no doubt accepted the fair rent fixed in a sum of Rs.35,125/- per month and for about 10 months they paid the said fair rent also. But it was the landlords who preferred RCA for enhancement and ultimately, the appellate authority set aside the order of the Rent Controller and remitted the matter back to him and thereafter the tenant stopped paying the higher rent of Rs.35,125/- per month. (f) As against the order of the Appellate authority in that RCA a separate revision in CRP NPD No.888 of 2006 was filed and in that this court set aside the order of the Appellate authority and remitted the matter back to him for considering it by himself afresh. Hence, in such a case, the very non-payment of rent in this process cannot be construed as willful default at all. Both the courts below taking into consideration the pros and cons of the matter, held that there was no willful default. https://hcservices.ecourts.gov.in/hcservices/ (g) The appellate authority taking into account the evidentiary aspect of the matter held that huge amount was available with the landlords towards advance and in such a case, it would not lie in the mouth of the landlords to raise their accusative finger as though there was willful default. As such, the finding of the Appellate authority that there was no willful default warrants no interference. (h) Regarding change of user is concerned, the original agreement which the landlords suppressed would clearly contemplate that the tenants were permitted to use the premises for conducting business and there was no restriction at all. In such a case, any business, which is not illegal can be undertaken by the tenants. (i) Here, originally, the tenant M/s.Tip Top Southern Bonanza was carrying on business in fancy goods and subsequently, they switched over to the business of selling pillows and beds, which are not at all in any way injurious to the premises or contrary to the terms and conditions of the lease agreement and as such the findings given by both the courts below warrants, no interference. (j) Regarding the plea of act of waste is concerned, both the courts below placing reliance on the oral and the documentary evidence clearly held that mere removal of the stair case and that too, which was in a dilapidated condition, would not amount to causing loss in the value of the building or lessening the utility of the building and accordingly the said findings of the courts below also warrant no interference by this court. (k) The power of the revisional court under Section 25 of the Tamil Nadu Buildings (Lease and Rent Control) Act is limited and unless there is any perversity or illegality in passing the orders by the courts below, the question of interfering in the revision would not arise. Accordingly, the learned counsel for the tenants pray for dismissal of both the revisions. 6. The point for consideration is as to whether there is any perversity or illegality in the findings given by the courts below that there was no sub-letting; that there was no willful default; that there was no change of user and that there was no act of waste on the part of the tenants, warranting interference by this court in these revisions? IN RE SUB-LETTING: 7. Regarding the plea of sub-letting is concerned, at the outset itself, I would like to point out that indubitably and indisputably, the landlords agreed that there could be change in constitution of the partnership but the only requirement was that the landlords should be https://hcservices.ecourts.gov.in/hcservices/ put on notice about such change. In this case, the learned counsel for the tenants inviting the attention of this court to the documentary evidence, without any fear of contradiction, would convincingly and correctly point out that whenever there was change in the constitution of the partnership, the landlords were put on notice and the landlords also recognised the same and there is no question of sub-letting would arise. However, the learned senior counsel for the landlords would submit that the alleged re-constitution of the partnership is nothing but a ruse to camouflage and conceal the actual sale of the business by the original two partners in favour of the alleged two new partners viz., Shanmugam and Kandasamy. 8. The learned senior counsel for the landlords would invite the attention of this court to Ex.R7, the retirement deed of M/s.Tip Top Southern Plaza and the relevant portion is extracted here under for ready reference: "6. The parties of the First part have received a sum of Rs.20,00,000/- (rupees twenty lakhs only) from the parties of the second part in liew of their retirement from the firm in full and final settlement of goodwill, in the said partnership asset. Consideration of good will is being paid vide State Bank of India, City Branch, Coimbatore vide Bankers cheque No.750493 and 750492 dated 24.03.2003 for Rs.17,00,000 & Rs.3,00,000/- drawn in favour of B.Mohamed Kasim and S.Rahmathunnisa respectively." (emphasis supplied) Placing reliance on the aforesaid excerpt the learned senior counsel for the landlords would develop his argument to the effect that the very clause would display and demonstrate that the original partners received a sum of Rs.20 lakhs not by way of getting their dues payable after settlement of accounts but only towards goodwill and that evinces and expatiates that they sold the good will of their business to those two newly inducted persons and it tantamounts to sub-letting the premises. 9. Whereas the learned counsel for the tenants would submit that from 1976 onwards the original partners were doing the business and only in token of honouring their commitment to the business such amount was paid and that was also by way of settling the dues in their favour and not by way of purchasing the goodwill from them. 10. The distinction sought to be made by the learned counsel for the tenants is one between tweedledum and tweedledee, between six of the one and half a dozen of the other and not the one between chalk and cheese. If really the original partners had wanted to induct new partners and retire, then accounts should have been taken as on the date of their retirement and in token of settling their dues payable https://hcservices.ecourts.gov.in/hcservices/ to the old partners, such amount should have been paid to them. But the wordings as extracted supra would display and convey that they virtually sold their goodwill in favour of their new partners. 11. Trite the proposition of law is that a retiring partner is not entitled to any consideration towards the goodwill of their business because the concept of inducting new partners and proceeding with the partnership would connote and denote that the good will would be automatically used by the new partners in conducting the business. But if the retiring partners are getting quid pro quo for their good will then it would amount to retiring partners selling their business in favour of the new partners. 12. Accordingly, if viewed it amounts to sub-letting and it is not a case of mere change of the constitution of the partnership as per the agreed terms of the lease. As such, the courts below fell into error in not taking into account the niceties of law involved in this case and simply held as though the original two partners retired after inducting the two new partners, viz., Shanmugam and Kandasamy. 13. In my considered opinion, the findings arrived at by the courts below without taking into account the law and applying to the existing facts would amount to nothing but perversity and illegality, warranting interference by this court in these revisions. 14. I would like to fumigate my mind with the following two decisions of the Honourable Apex Court relating to the revisional power of the High Court under Section 25 of the Act. (i) JT 2000 (SUPPL.3) SC 83 – D.RADHAKRISHNAN AND ANOTHER VS. M.LOORDUSWAMY & OTHERS, certain excerpts from it would run thus: "5. The requirement of Section 14(1)(b) of the Act for the purpose of demolition and reconstruction has been considered and dealt with elaborately by a constitution Bench of this Court in the case of Vijay Singh & Ors. v. Vijayalakshmi Ammal (JT 1996(9) SC 408 = (1996) 6 SCC 475). The only question that arises for our consideration is, whether the findings arrived at by the Rent Controller and affirmed by the appellate authority, could have been interfered with by the High Court in exercise of revisional jurisdiction under Section 25 of the Act. Though the power of revision of the High Court under Section 25 cannot be held to be similar to the power of civil court under Section 115 C.P.C.,but at the same time, the same cannot be held to be conferring appellate power on the High Court. The High Court is only required to examine and satisfy, whether the procedure followed by the forum below is regular or not and whether there has been any illegality or impropriety of the https://hcservices.ecourts.gov.in/hcservices/ decisions arrived at. 6. . . . . . While exercising revisional jurisdiction, to find out illegality with the findings or illegality of any procedure, it was not open to reappreciate the evidence, in the light of the object of the Act. In that view of the matter, we set aside the impugned order of the High Court and affirm the decision of the Rent Controller as affirmed by the appellate authority. Respondent No.1 is granted six months' time to deliver the vacant possession of the premises to the landlord subject to the usual undertaking being filed in this Court within four weeks from today. The appeals stand disposed of accordingly." (ii) 2001(2) CTC 95 – VALLAMPATI KALAVATHI V. VAJI ISMAI, certain excerpts from it would run thus: "11. . . . The finding recorded by the High Court in the revisional proceedings amounts to taking a view different from those recorded by the Forums below on the evidence available on the record. Was this permissible within the purview of the revisional power vested in the High Court under Section 22 of the Act? The said section reads as follows: "22. Revision: (1) The High Court may, at any time, on the application of any aggrieved party, call for and examine the records relating to any order passed or proceeding taken under this Act by the Controller in execution under Section 15 or by the appellate authority on appeal under Section 20, for the purpose of satisfying itself as to the legality, regularity or of propriety of such order or proceeding, and may pass such order in reference thereto as it thinks fit. 2) The costs of and incident to all proceedings, before the High Court under sub-section (1), shall be in its discretion." 12. As the language of the section suggests, the revisional power vested in the High Court is to be used for the purpose of satisfying itself as to the legality, regularity or propriety of such order or proceeding, and if satisfied that the order/orders suffer any such vice the High Court may pass such order in reference to the proceeding as it thinks fit. The expression 'legality', 'regularity' or 'propriety' are undoubtedly wider than mere correction of jurisdictional error. But even such regional power cannot be exercised to upset the concurrent findings of fact recorded by the Forums below merely on the ground that the High Court is inclined to take a different view on the materials on record in the case. We should not be understood to be saying that the concurrent findings of fact can in no case be interfered with in revision. For such interference it has to be shown that the https://hcservices.ecourts.gov.in/hcservices/ findings recorded by the Forums below suffer from any inherent defect or are based on inadmissible or irrelevant materials or are so perverse that no reasonable person will come to such conclusion on the material." 15. A mere poring over and perusal of the above excerpts, including the whole judgments would amply make the point clear that even though this Court, while exercising its jurisdiction under Section 25 of the Tamil Nadu Buildings (Lease and Rent Control) Act is having more revisional powers than the revisional powers under Article 227 of the Constitution of India or under Section 115 of the C.P.C. yet it cannot assume the role of an appellate Court, which is the last Court of facts. Unless there is perversity or gross illegality, the question of interfering in revision under Section 25 of the Act would not arise. 16. Here my discussion supra would demonstrate and display that there was total non-application of the correct provision of law relating to sub-letting in analysing and interpreting the evidence and that alone warranted interference. IN RE WILLFUL DEFAULT IN PAYING RENT: 17. In respect of the willful default is concerned, the learned senior counsel for the landlords inviting the attention of this court to the additional typed set of papers at page Nos.129 to 131 would develop his argument that from 16.06.2003 onwards, the tenants deposited rent at the rate of Rs.8000/- per month and from 23.02.2005 onwards the tenants started depositing the fair rent fixed in a sum of Rs.35,125/- per month and as such for 10 months, they were paying the enhanced rate of Rs.35,125/- per month and from 14.09.2006 onwards once again the tenants reverted back to the old rate of rent at Rs.8000/- per month in depositing the rent. 18. The learned counsel for the tenants as set out supra would reiterate his point by pointing out that because of the order passed by the appellate court in setting aside the fixation of fair rent by the Rent Controller, there were some apparent inconsistency in paying the rent and in fact it would not amount to willful default. 19. At once I would agree with the learned counsel for the tenants that there was upsetting of the decision of the rent controller by the appellate authority, relating to fixation of fair rent. But this is a singularly singular case, in which the tenants after the rent controller fixed the fair rent in a sum of Rs.35,125/-, candidly and