Lsp IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL CIVIL CIVIL APPELLATE JURISDICTION APPELLATE JURISDICTION APPELLATE JURISDICTION WRIT PETITION NO. 3794 of 1991 Shri Shankar Vishnu Sonar (Lohokare) ...Petitioner since deceased by his heirs and legal (original representatives:- defendant no.3) 1. Smt. Sindhu Shankar Lohokare age 53 years, residing at 504, Budhwar Peth, Pune 2 (son), 2. Shri Sanjay Shankar Lohokare, age 32 years, residing at 504, (address as above). 3. Dr. Dhananjay Shankar Lohokare, age 28 years, residing at St. Annes Hospital, Chodegaon, Taluka Nivasa, District Ahmednagar (Son). 4. Sou. Sujata Ashok Ghodke, age 30 years, Yadogopal Peth, Satara (Daughter), 5. Sou. Rashmi Ravindra Kamble, age 29 years, residing at 1402, Kasba Peth, Pune 11 (daughter) ...Applicants (Heirs of the original petitioner). v/s. Sou. Kusum Gajanan Pawar through her Mukhtyar- Chandrakant Khanderao Pawar, r/at: 453, Sadashiv Peth, Pune. 2. Shri Shripad Bhaskar Dhabbu, r/at Phaltan. ...Respondents (original plaintiffs and defendants 1 & 2 respectively). 3. Sou. Arundhati Arun Godse (w.p. stand dismissed against respondent no.3 vide Addl. Registrar’s order dated 21-8-1997) Ms. Kiran Bhagadia for the petitioners. Mr. N.P.Deshpande for the respondents. 2 CORAM CORAM CORAM : A.M.KHANWILKAR,J. : A.M.KHANWILKAR,J. : A.M.KHANWILKAR,J. DATED DATED DATED : APRIL 04, 2009. : APRIL 04, 2009. : APRIL 04, 2009. JUDGMENT JUDGMENT JUDGMENT . This writ petition under Article 227 of the Constitution of India takes exception to the Judgment and decree passed by the 12th Additional Judge, Pune dated 19/7/1991 in Civil Appeal No. 880/1987 which in turn has confirmed the Judgment and decree for possession of the suit premises passed against the petitioner-defendant no.3 on the ground of arrears of rent by the IInd Additional Small Causes Judge, Pune dated August 1, 1987 in Civil Suit No. 4/1983. 2. Briefly stated, the premises in question consist of a shed-cum-room admeasuring about 40 feet X 18 feet situated at CTS No. 35, Sadashiv Peth, Pune. The case of respondent no.1-plaintiff was that the aforesaid suit premises were let out to respondents 2 & 3 herein (defendants 1 & 2) for the purpose of running a laundry business. Whereas, the Respondent no.1 found petitioner (defendant no.3) in possession of the suit premises sometime in 1980. Accordingly, respondent no.1 issued legal notice to respondents 2 & 3 not only demanding arrears of rent but also terminating the tenancy. Copy of the said notice was marked to petitioner (defendant no.3). On the basis of said notice, respondent no.1 3 proceeded to institute Suit for possession of the suit premises against the defendants, namely, respondents 2 & 3 and petitioner herein, on the ground that the defendants 1 & 2 (respondents 2&3 herein) have unlawfully transferred the suit premises in favour of petitioner (defendant no.3). Respondent No. 1 also alleged that the petitioner (defendant no.3) without his consent in writing erected a permanent structure in the suit premises. Respondent No.1 further alleged that inspite of legal notice and raising demand regarding arrears due from June 1980 to November 1981 in terms of Demand Notice dated 22/10/1982 Exhibit 59, the defendants have failed and neglected to pay the arrears and were defaulters. On the above basis, respondent no.1 (plaintiff) prayed for possession of the suit premises. 3. The said suit was resisted by the defendants. The defendants denied the allegation of unlawful subletting and instead asserted that a running business was transferred and assigned in favour of petitioner (defendant no.3) by the respondents 2 & 3 (defendants 1 & 2) which was permissible in view of provisions of Section 15 of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 (hereinafter referred to as Bombay Rent Act) as applicable to the suit premises at the relevant time. In so far as allegation of erection 4 of permanent structure in the suit premises the same was also stoutly denied. In so far as ground of arrears of rent is concerned, the petitioner (defendant no.3) principally, in the first place, submitted that rent was paid from time to time directly to the plaintiff for which no receipts were issued. It was next asserted that petitioner (defendant no.3) being a transferee/assignee of the running business was tenant within the meaning of Section 5(11)(aa) of the Act. However, no notice of demand was addressed to the petitioner (defendant no.3). The demand notice Exhibit 59 was addressed to defendant nos. 1 & 2 only and a copy thereof was marked to the petitioner (defendant no.3). It was contended that forwarding copy of the demand notice was not sufficient compliance of the mandatory requirement of issuance of demand notice even against the petitioner (defendant no.3) being the transferee/assignee in respect of the running business conducted from the suit premises at the relevant time. The petitioner (defendant no.3) also asserted that the running business was taken over by a partnership firm of which petitioner-defendant no.3 was one of the partner. The other partner Shri Wagh, though a necessary party, was not impleaded, for which the suit suffered from non-joinder of necessary party. Broadly, on the above stand the defendants contested the suit. 5 4. The parties adduced oral as well as documentary evidence in support of their respective stand. On analysing the evidence on record, the trial Court, in the first place, took the view that non-joinder of another Partner of the petitioner (defendant no.3), in the partnership firm who had purchased the running business conducted in the suit premises, would not militate against respondent no.1 (plaintiff). The trial Court then answered the issue of erection of permanent structure on the suit premises against the plaintiff and in favour of defendants on the finding that the plaintiffs failed to establish the said allegation. Even the ground of unlawful subletting has been answered against the plaintiff and in favour of defendants. The trial Court has found that the defendants 1& 2 (respondents 2&3 herein) had transferred their interest in the running business conducted from the suit premises in favour of defendant no.3 which was permissible within the provisions of Section 15 of the Bombay Rent Act read with the Government notification dated 24/9/1948. The only issue answered against the defendants was the ground of arrears of rent. The trial Court found that the demand notice dated 22/10/1982 Exhibit 59 was duly served upon the defendants and inspite of said notice the defendants failed and neglected to pay the amount as demanded therein or to raise dispute regarding standard rent by filing application before the Rent Court in that 6 behalf within one month from the date of receipt of such demand notice. On this finding the trial Court answered the ground of arrears of rent against the defendants. 5. In so far as the grievance of the petitioner (defendant no.3) that no demand notice was issued to the petitioner, the trial Court has observed that copy of the notice was forwarded to the petitioner and inspite of being aware about such notice, the petitioner failed to pay the arrears of rent within the statutory period for which he would also suffer the consequence of eviction on the ground of default. The trial Court was of the view that the plaintiff could not be blamed also for the reason that the plaintiff was not aware about the status of defendant no.3 in relation to the suit premises until the defendants filed their written-statement. In other words, the trial Court proceeded on the basis that intimation received by the petitioner (defendant no.3) by way of notice dated 22/10/1982 (Exhibit 59) was sufficient to proceed even against the petitioner (defendant no.3). Accordingly, the trial Court decreed the suit in favour of the plaintiff and ordered the defendants to deliver vacant possession of the suit premises to the plaintiff. 6. Against the said decree the petitioner (defendant no.3) alone carried the matter in appeal before the 7 District Court being Civil Appeal No. 880/1987. On the other hand, respondent no.1 (plaintiff) filed cross objections challenging the opinion of the trial Court on the issue of unlawful subletting and illegal erection of permanent structure in the suit premises. The Appellate Court was pleased to dispose of the appeal as well as the cross objections together by common judgment and decree dated 19/7/1991. The Appellate Court confirmed the finding recorded by the trial Court on every singular issue and, therefore, dismissed the appeal preferred by the petitioner (defendant no.3) and also the cross objections filed by respondent no.1 (plaintiff). Against this decision present writ petition has been filed by defendant no.3 only. No cross objection or cross petition has been filed by the plaintiff in relation to the other two grounds of eviction, which has been answered against him. 7. In the present petition, defendant no.3 has primarily assailed the concurrent view taken by the two Courts below in relation to ground of arrears of rent on which decree of possession of the suit premises has been passed against him as well. More or less similar argument has been canvassed before this Court to assail the correctness of the view taken by the two Courts below on the said issue. 8 8. Having considered the rival submissions I would straightway observe that in so far as the findings recorded by the two Courts below against defendants 1 & 2 in respect of ground of arrears of rent are concerned, the same are unexceptionable. In that, both the Courts below have concurrently found that demand notice was issued by the plaintiff on 22/10/1982 Exhibit 59 which was duly served on the said defendants. Inspite of service of the said demand notice the defendants 1 & 2 (tenants) did not bother to pay the amount as demanded in the said notice nor filed any application for fixation of standard rent within a period of one month from the receipt thereof. The inevitable consequence thereof was to order eviction of the tenants on the ground of arrears of rent within the meaning of Section 12(3)(a) of the Act. 9. As aforesaid, the decree passed against defendants 1 & 2 on the ground of arrears of rent has not been challenged by the said defendants. However,the question is whether on the basis of said decree even the petitioner (defendant no.3) would suffer the consequence of eviction. Indeed, the plaintiff approached the trial Court on the assertion that defendant no.3 was a person claiming through the defendants 1 & 2, the tenants. If that case was to be accepted, it would necessarily follow that defendant no.3 would be bound by the decree 9 passed against defendant nos. 1 & 2. However, the case of defendant no.3 was that defendants 1 & 2 had transferred the running business alongwith the stock-in-trade and goodwill thereof in favour of the partnership firm of which he was one of the partner. Both the Courts below have accepted this stand of defendant no.3. It has also been found by both the Courts below that such transfer/assignment of a running business was permitted by the provisions of Section 15 of the Rent Act as it applied at the relevant time. For that reason, the defendant no.3 cannot be labelled as trespasser or an unlawful subtenant, but has acquired the status of a tenant within the meaning of Section 5(11)(aa) of the Act. This finding rendered by the two Courts below in the context of issue of unlawful subtenant has been allowed to become final as no writ petition has been filed by the plaintiff nor any cross objection has been filed in the present writ petition to question the correctness thereof. Considering this finding, the fact that a decree of eviction has been passed against the head-tenant would make no difference. For, that decree would not affect the transferee/assignee who, in law, would be a deemed direct tenant of the landlord. It is only upon determination of that relationship of the defendant no.3 by the landlord, the question of evicting the transferee/assignee would arise. Indeed, two Courts 10 below have concurrently held that in so far as petitioner (defendant no.3) is concerned, it is established from the record that copy of the demand notice dated 22/10/1982 Exhibit 59 was duly "forwarded" to the petitioner (defendant no.3) and was received by him. Further, inspite of receipt of said demand notice, even the petitioner (defendant no.3) failed and neglected to pay the amount towards arrears of rent as demanded in the said notice or filed application for fixation of standard rent within one month from receipt thereof. The fact proved that the notice was forwarded to the petitioner (defendant no.3) and that it was received by the petitioner (defendant no.3) cannot be over turned by this Court. 10. The question is: whether merely because copy of demand notice, which was addressed to defendant nos. 1 & 2, was "forwarded" to defendant no.3, fulfils the mandatory requirement of due service of a demand notice on the defendant no.3 within the meaning of Section 12(2) of the Act. By now, it is well established position that, unless a notice in writing of the demand of the standard rent or permitted increases has been served upon the tenant in the manner provided in Section 106 of the Transfer of Property Act 1882, no suit for recovery of possession can be maintained by the landlord against the tenant. The fact that defendants 1 & 2 have 11 been duly served with the said demand notice would be of no avail, in the fact situation of the present case. In law, defendant no.3 would become the direct tenant of the plaintiff in terms of Section 5(11)(aa) of the Act, soon after the determination of tenancy of defendant nos. 1 and 2. On acquiring such status the plaintiff was obliged to serve the defendant no. 3 with a notice in writing about the demand of the standard rent and permitted increases in the manner provided in Section 12(2) of the Act. It is not in dispute that the demand notice dated 22/10/1982 Exhibit 59 has been addressed to only defendants 1 & 2 and at the end of the notice it is mentioned that copy is marked to defendant no.3 (i.e. C.C. sent for information). There is a marked difference between the requirement of sending a demand notice-which is necessarily required to be addressed to a person then merely forwarding a copy of such communication. The latter, at best is in the nature of apprising the recipient of that communication of the fact of issuance of a legal notice to the addressee (i.e. defendant nos. 1 & 2) by the sender (plaintiff). On the other hand, the legal requirement is of sending or addressing a notice in writing of the demand to the tenant, which postulates putting him to notice about non-payment of the rent and permitted increases which is due, and "calling upon him to pay" the same forthwith. In other words, where the tenant happens to be an 12 assignee, who is in possession of the suit premises in his own rights on account of a valid assignment and is allegedly in arrears of rent, a demand notice under Section 12(2) must be given to him as well. In absence of such a notice to the assignee, the question of instituting ejectment suit against him on the ground of arrears of rent does not arise at all. In that, Section 12(2) is a statutory bar for institution of suit against the tenant until a demand notice is issued to him and is duly served upon him in the manner provided for therein. The fact that the assignee may become aware about the contents of the demand notice sent to the original or head tenants does not extricate the landlord of his obligation to issue or address a valid demand notice to the assignee, if he wants to proceed even against the assignee alongwith the head-tenant for ejectment from the suit premises on the ground of arrears of rent. The fact that the plaintiff in this case was not aware that the defendant no.3 (petitioner) was lawful transferee/assignee in the suit premises does not take the matter any further. The requirement of Section 12(2) is not a mere formality. It is a mandatory provision and only on compliance of the said obligation, the cause of action to sue the tenant on the ground of arrears of rent would accrue to the landlord. Non-compliance of the said mandatory requirement in any manner would result in dismissal of the suit for want of 13 cause of action-as the bar placed by sub-section (2) of Section 12 of the Act is not lifted. A priori, even though respondent no.1 (plaintiff) may have succeeded in getting ejectment decree against the defendants 1 & 2-the head tenants, that decree (in so far as the ground of default) will be of no avail against the assignee (defendant no.3) unless it is shown that lawful demand notice was addressed also to transferee/assignee (defendant no.3) and inspite of that notice he failed to pay the outstanding amount demanded in the said notice or file application for fixation of standard rent within a period of one month from the date of service of the notice. 11. To get over this position, Counsel for the respondent (plaintiff) would submit that the respondent is entitled to support the decree passed by the two Courts below by persuading this Court to hold that the transfer in favour of petitioner (defendant no.3) was not a lawful transfer or assignment. It was argued that if this submission were to be accepted, it would necessarily follow that the petitioner (defendant no.3) would be bound by the decree for possession passed against defendant nos. 1 & 2. However, when confronted with the position that respondent no.1 has not bothered to challenge the concurrent opinion recorded by two 14 Courts below on the issue of unlawful subletting and for which reason cannot be allowed to raise a new plea across the bar, Counsel for respondent no.1 would submit that even without filing any cross objection or for that matter challenging the opinion recorded by the Lower Appellate Court while rejecting his cross objection, it is open to respondent no.1 to support the decree for possession by assailing the finding of the two Courts below on the ground of unlawful subletting on the analogy of provisions of Order 41 Rule 22(1) of CPC. According to him, this issue is already answered in one of the latest decisions of our High Court in the case of M/s. M/s. M/s. Musaji Mohamadali Master & anr. v/s. Mr. Musaji Mohamadali Master & anr. v/s. Mr. Musaji Mohamadali Master & anr. v/s. Mr. Gulamali Gulamali Gulamali Dadabhai Amreliwala (deceased through LRs) & Dadabhai Amreliwala (deceased through LRs) & Dadabhai Amreliwala (deceased through LRs) & ors. ors. ors. reported in 2005 (2) All MR 320 reported in 2005 (2) All MR 320 reported in 2005 (2) All MR 320. In this judgment, single Judge of our High Court has taken the view that the procedure provided by the CPC will have to be followed in relation to filing and prosecuting petition under Article 227 of the Constitution, keeping in mind the purport of Section 141 of CPC. In other words, filing of cross objection or cross appeal would be wholly unnecessary to challenge the adverse finding. Learned Counsel also placed reliance on the decision of the Apex Court in the case of Surya Dev Rai v/s. Ram Surya Dev Rai v/s. Ram Surya Dev Rai v/s. Ram Chander Chander Chander Rai & ors. reported in (2003) 6 Supreme Court Rai & ors. reported in (2003) 6 Supreme Court Rai & ors. reported in (2003) 6 Supreme Court Cases Cases Cases 675 675 675 which has generally considered the plenitude of power of this Court while exercising jurisdiction 15 under Article 227 of the Constitution of India. According to respondent no.1, he is entitled to challenge the finding in relation to ground of unlawful subletting and support the decree of eviction on that ground even though the Courts below have answered the said issue against him. In the alternative, it is submitted that in any case it is open to respondent no.1 (plaintiff) to challenge the adverse finding recorded by the Courts below on the issue of unlawful subletting and on that basis support the decree passed on the ground of arrears of rent, without asking for a decree on the ground of unlawful subletting, even if respondent no. 1 was to succeed in persuading this Court to over turn the concurrent findings recorded by two Courts below on that issue. According to Counsel for respondent no.1 that would at best result in confirming the decree on the ground of arrears of rent by adopting different reasons and approach by this Court on the basis of established facts. Learned Counsel also placed reliance on the decision in the case of State of A.P. v/s. P.V. State of A.P. v/s. P.V. State of A.P. v/s. P.V. Hanumantha Hanumantha Hanumantha Rao (dead through LRs) & anr. reported in Rao (dead through LRs) & anr. reported in Rao (dead through LRs) & anr. reported in (2003) (2003) (2003) 10 10 10 SCC page 121 SCC page 121 SCC page 121 which has generally observed that the remedy of writ petition is not against the decision of the subordinate Court, Tribunal or Authority but against the "decision making process". It is further noted that in the "decision making process", if the Court, Tribunal or authority deciding the case had 16 ignored vital evidence and thereby arrived at erroneous conclusion or has misconstrued the provisions of the relevant Act or misunderstood the scope of its jurisdiction, the Constitutional power of the High Court under Articles 226 & 227 can be invoked to set right such errors and prevent gross injustice to the party complaining. On the assumption that this Court would be bound to consider the challenge to the finding on the issue of unlawful subletting, Counsel for respondent no.1 has contended that this Court will have to enquire into the fact as to whether any legal evidence has been produced by the defendants to establish the factum of transfer or assignment was in respect of a going concern with stock-in-trade and goodwill thereof. It was argued that very recently this Court in the case of Dattatray Dattatray Dattatray Dagdoba Dagdoba Dagdoba Dhole Dhole Dhole v/s. Shaikh Javed Husen Hajrat v/s. Shaikh Javed Husen Hajrat v/s. Shaikh Javed Husen Hajrat decided on March 6, 2009 in Writ Petition No. 2458/1986 Writ Petition No. 2458/1986 Writ Petition No. 2458/1986 had occasion to consider the efficacy of document such as deed executed on 1/4/1980 between the defendants 1 & 2 on the one hand and defendant no.3 on the other. This Court has taken the view that such deed cannot be used against a person who is not party thereto. It was argued that if the said deed was to be excluded from consideration, no other contemporaneous evidence has been produced by the defendants to establish the fact that the transfer was in respect of a running business alongwith stock-in-trade and goodwill of a going 17 concern. It was argued that the onus of establishing the fact of transfer/assignment is of a running concern alongwith stock-in-trade and goodwill thereof is on the person (in this case defendants) who asserts that position. On the above arguments it was contended that respondent no.1 would be entitled to support the decree of possession passed against the defendants including petitioner (defendant no.3) on the ground of unlawful subletting and in any case on the ground of arrears of rent upon reversing the finding recorded in relation to the ground of unlawful subletting by the two Courts below. 12. The above argument has been justly countered by the Counsel for the petitioner. The petitioner has rightly pressed into service exposition of the Apex Court in