1 mst IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO.1171 OF 2009 Ministry of Food and Civil Supplies, Government of Maharashtra, Bengalee Girls High School, 42, New Marine Line, Mumbai 400 020. Petitioner versus 1. Adi H. Mulla, 2. Kersi Commissanat, 3. Minoo M. Billimoria, 4. Mrs.Aban R. Minbativala, 5. Kersi J. Treasurywala, All the trustees of Parsee Girls Asso; 42, Sir Vithaldas thakersey Marg, Marine Lines, Mumbai 400 020. Respondents Mr.V.S.Gokhale, AGP for petitioner. Mr.Navroz Seervai, Sr.Counsel with Mr.Padgaonkar, Ikta Agrawal and Ms.Dimple Shah i/by Mulla & Mulla & CBC for respondents 1 to 5. CORAM : A.S.OKA, J. DATE : 05th March 2010 JUDGEMENT :- 1. On 9th February 2009 this Court issued notice for final disposal at admission stage. Accordingly, the writ petition is taken-up for final disposal. 2 2. The petitioner is the second defendant in a suit for possession filed by the first to fifth respondents. The sixth respondent is the first defendant. The suit for possession was filed by the plaintiffs in respect of suit premises more particularly described in paragraph 3 of the plaint. The case made out by the plaintiffs is that the first defendant (sixth respondent) was inducted as a tenant in the year 1954. It is alleged that the first defendant without consent of the plaintiffs has inducted and/or created unlawful license or interest in favour of the second respondent (petitioner herein). It is alleged that the petitioner-second defendant was in unlawful possession of the suit premises. Reliance was placed on section 3(1)(b) of the Maharashtra Rent Control Act, 1999 (hereinafter referred to as "the said Act of 1999"). It was contended that as paid-up share capital of the first defendant exceeds a sum of Rs.1.00 crore, the first defendant has no protection of the said Act of 1999. 3. Written statement was filed by the first defendant opposing the suit. A contention was raised that the first defendant being a government company is not exempted under section 3(1)(b) of the said Act of 1999. It was contended that the first defendant is neither a corporation nor a bank. It was contended that the first defendant was neither a public sector undertaking nor a company having a paid-up 3 share capital of Rs.1.00 crore or more. In the written statement it was contended that the first defendant was established as a government company in the year 1972 when the second defendant was already in use and occupation of the suit premises. It was contended that the cause of action of alleged sub-letting was hopelessly barred by law of limitation. The petitioners-second defendant also filed written statement and contended that the said defendant was in exclusive use, occupation and possession of the suit premises as lawful sub- tenant of the first defendants since February 1959 and no objection has been raised by the plaintiffs to their possession. It was contended that as the second defendant was in exclusive possession of the suit premises from the year 1959, the said defendant had become protected lawful sub-tenant or a deemed tenant. It was contended that the said defendant was protected by the provisions of the said Act and hence the suit was not maintainable. The Trial Court framed various issues including an issue whether the second defendants prove that it is a lawful sub-tenant. The Trial Court partly decreed the suit by passing a decree, however, the claim as against second defendant was dismissed. The Trial Court held that section 3(1)(b) of the said Act was applicable to the first defendant and not to the second defendant. It was held that the second defendant was a lawful sub-tenant protected under the provisions of Rent Control Act. An appeal was preferred by the plaintiffs which has been allowed by 4 the Appellate Court and a decree for possession has been passed against the petitioner-second defendant. 4. The learned AGP appearing for the petitioner-State Government submitted that going by the finding of fact recorded by the Courts below, the petitioner-second defendant was inducted as a sub-tenant in the year 1959 by the first defendant and therefore by virtue of provisions of Bombay Rates, Hotel and Lodging House Rates Control Act, 1947 (hereinafter referred to as "the said Act of 1947"), as amended by Maharashtra Act No.XVIII/1987, the petitioner-second defendant acquired status as a tenant with effect from 1st February 1973. He placed reliance on sub section 2 of section 15 of the said Act of 1947 in support of his contention. 5. Learned senior counsel appearing for the first to firth respondents-original plaintiffs supported the impugned judgment and decree. He submitted that even the Trial Court has not recorded a finding that the petitioner-second defendant acquired the status as a tenant. He submitted that the suit will be governed by the said Act of 1999 and in view of the decision of the Apex Court in case of Leelabai Gajanan Pansare and others Vs. Oriental Insurance Company Ltd. and others ([2008]0-SCC-720), first defendant will not have protection of the said Act. He submitted that the first defendant was admittedly a 5 tenant in respect of the suit property. He submitted that the tenancy of the first defendant was validly terminated and, therefore,the petitioners-second defendant will have to be evicted along with first defendant. He submitted that there is no clear finding that the second defendant was a sub-tenant. He urged that both the defendants have no right to occupy the suit premises. He submitted that no interference is called for in the impugned judgment and decree. 6. I have carefully considered the submissions. In the plaint and in particular in paragraph 6 the plaintiffs have alleged thus:- "6. The Plaintiffs say that they have learnt that the Defendant No.1 had without their prior knowledge and consent inducted into and/or parted with and/or created unlawful license or interest in favour of the Defendant No.2 herein. The Defendant No.2 is presently in unlawful use and occupation of the suit premises without any right due or interest." The plaint proceeds on the footing that the first defendant is the tenant who is not protected under the said Act of 1999 in view of section 3(1)(b) thereof. The first defendant came out with the case that the second defendant was already in possession when the first defendant became a government company in the year 1972 and in fact the second defendant was inducted in 1950's. A specific stand taken by the petitioner-second defendant in the written statement is in paragraph 8 which reads thus :- 6 "8. With regard to paras 5 and 6 this Defendant states that with the knowledge and consent of the plaintiff the defendant no.1 sublet the suit premises to this Defendant since February, 1959 and since then the defendant no.1 is in exclusive use, occupation and possession of the suit premises as the lawful sub-tenant without any objection whatsoever from the plaintiffs. This defendant is duly protected under the provisions of the Rent Act as amended. This defendant denies the allegations in para 6 that defendant no.1 had without their knowledge and consent inducted into and/or parted with and/or created unlawful license or interest in favour of the defendant no.2 herein." The Trial Court framed a specific issue being issue no.5 putting burden on the second defendant to prove that they were lawful sub- tenants protected under the Rent Control Act. The said issue has been answered by the Trial Court in favour of the petitioner-second defendant. The Trial Court, by a detailed finding, accepted the case made out by the petitioner-second defendant that the said defendant was in possession as a sub-tenant prior to 1nd February 1973. It will be also necessary to consider the finding recorded by the Appellate Court on this aspect. Before the Appellate Court, a submission was made by the learned counsel for the plaintiffs that in view of section 3(1)(b) of the said Act of 1999, the first defendant had no protection and second defendant is a sub-tenant of the first defendant. Thus, the case made out by the plaintiffs before the Appellate Court was that the petitioner-second defendant was a sub-tenant of the first defendant. In paragraph 18 of the judgment, the Appellate Court has 7 recorded an admitted position that the first defendant leased the suit premises to the second defendant in the year 1959 and since then the second defendant has been in possession of the suit premises. What is observed by the Appellate Court in paragraph 18 read thus :- "18. ... ... ... Admittedly the defendant no.1 leased the suit property to defendant no.2 in the year 1959 and since then defendant no.2 is in possession of suit property. Defendant no.2 is subtenant of defendant no. 1. There is no privity of contract between plaintiffs and defendant no.2. Defendant no.2 is claiming the right of tenancy over the suit property through defendant no.1 in respect of the suit property. ... ..." Thus, admitted position between the parties is that the second defendant was inducted by the first defendant in the suit premises in the year 1959 as a sub-tenant. The said Act of 1999 was brought into force with effect from 31.3.2000. It will be necessary to consider the relevant provisions of the Act of 1947. Sub section 1 of section 15 provides that in absence of contract to the contrary, it shall not be lawful for the tenant to sub-let or transfer or to give on license the tenanted premises. It will be necessary to consider provisions of section 15 as amended by Maharashtra Act No.XVIII/1987. Section 15 reads thus:- "15. In absence of contract to the contrary, tenant not to sub-let or transfer or to give on licence (1) Notwithstanding anything contained in any law but 8 subject to any contract to the contrary, it shall not be lawful after the coming into operation of this Act for any tenant to sub-let the whole or any part of the premises let to him or to assign or transfer in any other manner his interest therein and after the date of commencement of the Bombay Rents, Hotel and Lodging House Rates Control (Amendment) Act, 1973, for any tenant to give on licence the whole or part of such premises; (Provided that the State Government may by notification in the Official Gazette, permit in any area the transfer of interest in premises held under such lease or class of leases or the giving on licence any premises or class of premises and no such extent as may be specified in the notification. (2) The prohibition against the sub-letting of the whole or any part of the premises which have been let to any tenant, and against the assignment or transfer in any other manner of the interest of the tenant therein, contained in sub-section (1), shall, subject to the provisions of this sub-section be deemed to have had no effect before the 1st day of February, 1973, in any area in which this Act was in operation before such commencement; and accordingly, notwithstanding anything contained in any contract or in the judgment, decree or order a Court, any such sub-lease, assignment or transfer in favour of any person who has entered into possession, despite the prohibition in sub- section (1) as purported sub-lessee, assignee or transferee and has continued in a possession on the date aforesaid shall be deemed to be valid and effectual for all purposes, and any tenant who has sub-let any premises or part thereof, assigned or transferred any interest therein, shall not be liable to eviction under clause (e) of sub-section (1) of section 13. The provisions aforesaid of this sub-section shall not affect in any manner the operation of sub-section (1) after the date aforesaid." The effect of the amendment is that any sub-letting made by the tenant before 1st February 1973 will have no effect and the 9 prohibition against subletting will not apply. The said provision will have to be read with sub section 11 of section 5 of the said Act of 1947 which defines "tenant". Clauses (a), (aa) and (b) of sub section 11 of section 5 are relevant which read thus :- "S.5(11) "tenant means any person by whom or on whose account rent is payable for any premises and includes,- (a) such sub-tenants and other persons as have derived title under a tenant before the 1st day of February 1973; (aa) any person to whom interest in premises has been assigned or transferred as permitted or deemed to be permitted, under section 15; (b) any person remaining after the determination of the lease, in possession, with or without the assent of the landlord, of the premises leased to such person or his predecessor who has derived title before the first day of February 1973." Thus, it is apparent that a sub-tenant who is inducted by the tenant before 1st February 1973 becomes the tenant within the meaning of sub-section 11 of section 5. Thus, the legal effect is that on 1st February 1973 the second defendant i.e. the petitioner became tenant protected by the said Act of 1947. It must be noted here that sub- section 1 of section 4 of the said Act of 1947 makes it clear that protection of the said Act of 1947 will extend to the premises let to the Government or taken on behalf of Government on rent. Thus, when the said Act came into force on 1st April 2000, the second defendant 10 was a tenant in respect of suit premises. 7. A submission was sought to be made by the learned senior counsel appearing for the plaintiffs that a copy of notice of determination of tenancy issued to the first defendant was served to the second defendant. However, the suit filed by the plaintiffs proceeds on the assumption that the first defendant was the tenant and second defendant has no status. Therefore, there is no determination of tenancy of the second defendant made by the plaintiffs. Apart from that, clause (a) of sub section 1 of section 3 of the said Act of 1999 makes it very clear that provisions of the said Act shall apply in respect of premises let to the Government or taken on behalf of Government on such basis. Thus, the petitioners-second defendant has the protection of the provisions of the said Act of 1999. The decree passed by the Appellate Court proceeds completely on the erroneous assumption that the first defendant was the tenant on the date of institution of suit and that the second defendant had no right. The present suit has not been filed under the provisions of the said Act of 1999. In the circumstances, the decree for possession passed against the petitioner is completely illegal and the petition must succeed. 8. It must be stated here that the learned senior counsel for the 11 plaintiffs submitted that the decision of this Court should not preclude the plaintiffs from filing a fresh suit for eviction against the petitioner- second defendant. It is obvious that the judgment will not come in way of the original plaintiffs in filing a fresh suit for eviction against the petitioner-second defendant in accordance with the provisions of law. 9. Hence, I pass following order :- A) The writ petition is allowed in terms of prayer clause (a); B) There will be no order as to costs. (A.S.OKA, J.)