DSS J-wp-5339, 5247, 5337,5338 & 5340-93 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO. 5339 OF 1993 WITH WRIT PETITION NO. 5247 OF 1993 WITH WRIT PETITION NO. 5337 OF 1993 WITH WRIT PETITION NO. 5338 OF 1993 WITH WRIT PETITION NO. 5340 OF 1993 Bijaysingh Mansingh Baid & anr. .. Petitioners vs. Biharilal L. Raheja and ors. .. Respondents Mr. Vivek R. Walavalkar a/w. Mr. Sameer Bhalekar a/w. Ms Preeti Brahmania i/b S.M. Kazi for the Petitioners in all petitions. Mr. P.S. Dani, Sr. Advocate a/w. Mr. Kunal Bhanage for Respondent No.2-R.W. Raheja in all petitions. CORAM : M. S. SONAK, J. Date of Reserving the Judgment : 15 July 2015. Date of Pronouncing the Judgment : 15 September 2015. JUDGMENT :- 1. The learned counsel for the parties agree that these petitions can be disposed of by common judgment and order. 2. In all these petitions, the challenge is to the common judgment and order made by the Division Bench of the Small Cause Court at Bombay (Appeal Court) reversing the decree dated 8 September 1989 made by the Small Causes Court (Trial Court) and dismissing the suits instituted by the petitioners-landlords, seeking 1/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 eviction of the respondents from the suit premises. The common issues of law and fact arise in these matters. Accordingly, it would be appropriate if these batch of petitions are disposed of by common judgment and order. The learned counsel for the parties urged that Writ Petition No. 5339 of 1993 be treated as the lead petition. 3. The petitioners-landlords are the present owners of the building known as 'Sagar Bhavan' (formerly known as 'Shastri Building') bearing street No. 147, situated at Princes Street, Bombay- 400 002, which is acknowledged as one of the prime commercial locations in Mumbai. V.S. Kalelkar, the former owner of the building, sometime prior to 1966, let out to one Lachmandas C. Raheja (Raheja), two rooms on second floor of said building (suit premises) . 4. The petitioners-landlords purchased the building Sagar Bhavan, including the suit premises therein by Deed of Conveyance dated 15 April 1971. Even prior to such purchase, the former owner V.S. Kalelkar, by notice dated 26 November 1966 had purported to terminate the tenancy of the Raheja, inter alia on the ground that Raheja had changed the user from residential to non-residential; 2/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 that Raheja had acquired alternate residential premises in the adjoining building known as Zaveri Building; and that Raheja had unlawfully divided the suit premises comprising two rooms into four compartments and sub-let the same. 5. In response to termination notice dated 26 November 1966, addressed an evasive letter dated 7 January 1967 claiming that circumstances were explained to Kalelkar and Kalelkar expressed satisfaction at the explanation. Kalelkar, rejoined by letter dated 20 January 1967 denying expression of any satisfaction and substantially reiterating the contents of notice dated 26 November 1966. 6. The petitioners-landlords, consequent upon purchase of the building Sagar Bhavan, including the suit premises, caused legal notice dated 27 October 1971 to be served upon Raheja, once again alleging change of user, acquisition of alternate residential premises and unlawful sub-letting and demanded the possession of the suit premises. Similarly, by notice dated 28 October 1971, the petitioners-landlords, through their advocate, called upon respondent Nos.2 to 5 to explain under what arrangement or writing 3/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 they have been occupying the suit premises. Inquiry was also made with regard to rents, which the said parties have been paying and to whom. 7. As there was no response, the petitioners-landlords instituted R.A.E. Suit No. 5/15 of 1972 before the Trial Court seeking recovery of possession of the suit premises. 8. Raheja (Respondent No.1), who was impleaded as defendant No.1 in the suit, raised the following defences in the written statement filed on 19 September 1972: (a) That Raheja had taken up the tenancy in respect of suit premises on behalf of Partnership Firm M/s. Khemchand Tolaram , of which, Raheja and his two brother Khemchand and Tolaram were the partners; (b) Without prejudice, it was urged urged that the Firm M/s. Khemchand Tolaram are the sub-tenants in respect of the suit premises, prior to coming into force of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 (Rent Act) ; 4/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 (c) That the suit premises were let out for business purposes and not for purposes of residence. Accordingly, the allegation of change of user was denied; (d) That Raheja had acquired no alternate residential premises as alleged. In any case and without prejudice, one of the partners of M/s. Khemchand Tolaram , prior to coming into force of the Rent Act, had acquired alternate premises and Raheja had no nexus with such acquisition; (e) That Raheja had not acquired any alternate residential accommodation in the building known as 'Crystal' or that Raheja was not residing with his family in the building known as 'Crystal'; (f) That Raheja has never sub-let the suit premises or received any amounts by way of rent or compensation; (g) That Raheja has not been profiteering in rents. In any case and without prejudice, since sub-letting is alleged to be unlawful, ground of profiteering is unavailable to the landlords; (h) That defendant No.5 Madhavlal & Co. is a Proprietary concern of which Madhavlal Khemchand, son of Khemchand, Partner of M/s. Khemchand Tolaram is the Proprietor and 5/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 therefore, has right in the suit premises; and (i) That the other defendants, i.e., defendant Nos.2 to 4 are in occupation of the suit premises as gratitituous licensees and no amount of rent or compensation is recovered from them. Such defendants are also relatives of the family of the partners of M/s. Khemchand Tolaram. 9. Defendant No.2 R.W. Raheja (Respondent No.2) filed written statement on 21 August 1972. His defence is broadly as follows: (a) That defendant No.2 is lawful sub-tenant in respect of portion of suit premises which is in his exclusive use and occupation. Therefore, defendant No.2 is a protected tenant under the Rent Act; (b) That defendant No.2 admitted that the receipt of letter dated 28 October 1971 inquiring about his status qua the suit premises, but offered no explanation for the lack of response; (c) That the allegation of change of user, acquisition of alternate residence by defendant No.1 were denied ; and (d) That defendant No.2 amended the written statement in June 1977 to raise a claim of being 'protected licencee'. 6/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 10. Defendant No. 3 Girdharidas M. Lakhi, the Proprietor of R.G. Lakhi Mfg. Co. (Lakhi) (Respondent No.3) filed written statement on 18 September 1972, which is virtually identical to written statement filed by defendant No.2- R.W. Raheja. There is, however, no record that Lakhi amended the written statement to raise a claim being 'protected licencee'. 11. Defendant No.4 Vasudev R. Bajaj (Respondent No.4) filed written statement on 21 August 1972. His defence was that he was the lawful sub-tenant prior to 21 May 1959 and on termination of the tenancy of defendant No.1-Raheja, he has become the direct tenant of the landlords in respect of portion of the suit premises in his exclusive possession. Defendant No.4 has claimed to be fully protected under the provisions of Rent Act. 12. Defendant No. 5 Madhavlal & Co (Respondent No.5)filed written statement on 19 September 1972 claiming to occupy the suit premises as heir of Khemchand, the Partner of M/s. Khemchand Tolaram, who were the tenants of the suit premises. This defendant also claimed that other defendants are the relatives of defendant No.1- Raheja and are allowed to use the suit premises as licencee. In para 10, it was specifically pleaded that defendant Nos.2 to 4 are 7/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 neither charged rent nor compensation. Accordingly, the claim of unlawful subletting was denied. The status of protected tenant under the Rent Act was also claimed. 13. Defendant No.1 alongwith his written statement, filed a list of documents, which included correspondence, books of accounts, counter foils cheque, electric bills, telephone bills and income tax return. Defendant No.2 merely relied upon the correspondence received at the suit premises. Defendant No.3 also relied upon correspondence received at the address. Neither of the defendants specified the nature of contents of such correspondences. Defendant No.4 had relied upon Deed of Partnership dated 3 April 1964, Deed of Dissolution dated 11 April 1969, postal and other documents and papers, including income tax receipts and correspondence. Defendant No.5 relied upon books of account. All this is relevant , because ultimately, except for defendant No.1-Raheja none of the defendants examined either themselves or any witnesses in their support. None of the documents, upon which reliance was placed by at least, defendant Nos.2 to 5, were ever produced on record or proved. 8/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 14. The Trial Court, framed the following issues: 1. Do the plaintiff's prove the change of user of the suit premises by the defendant No.1 as alleged by them? 2. Do the plaintiffs prove that deft.no.1 has unlawfully sub let the suit premises to other defendants ? 3. Do the plaintiffs prove that the defendant No.1 has put in permanent wooden partition in the suit premises ? 4. Do the plaintiffs prove that the defendant no.1 got alternative suitable accommodation for his residence ? 5. Whether the tenancy of the defendant no.1 is validly terminated ? 6. Whether the defendant No.1 proves that the suit premises were let out to him for business purpose since inception ? 7. Whether the plaintiffs are entitled for possession of the suit premises ? 8. What order ? 15. Mansingh Baid (PW-1), the father of Bijaysingh (plaintiff No.1) was examined on behalf of the landlords and was cross- examined on behalf of all the defendants. Biharilal Raheja (DW-1), son of defendant No.1-Raheja was examined on behalf of defendant No.1- Raheja and was cross-examined on behalf of the plaintiffs- landlords. Defendant Nos.2 to 5 neither examined themselves nor any other witnesses in their behalf. 16. The Trial Court, by judgment and decree dated 8 September 1989 decreed the landlords suit, inter alia, on the ground of acquisition of alternate residential accommodations by defendant No.1-Raheja and unlawful subletting. 9/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 17. Each of the defendants instituted separate appeals being Appeal Nos. 396 (496 ?), 497, 498 , 499 and 500 of 1989 before the Appeal Court. The Appeal Court by common judgment and order dated 14 December 1992 has reversed the Trial Court. The Appeal Court has held that there was no conclusive material on record to establish that the suit premises had been let out only for the purposes of residence. In absence of such material, the ground regards acquisition of alternate suitable residential accommodation, was inapplicable. Further, since sub-letting of the portions of the suit premises was prior to 1 February 1973, by virtue of the provisions contained in Section 15(2) of the Rent Act, such sub-tenancies were regularised and such sub-tenants were protected tenants, who could not be evicted under the provisions of Rent Act. It is against this common judgment and order dated 14 December 1992, that the present petitions have been instituted by the petitioners-landlords. 18. Mr. Vivek Walavalkar, learned counsel for the petitioners- landlords, made the following submissions in support of these petitions: a] That the material on record, which establishes that the suit premises had been let out to defendant No.1 Raheja for 10/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 residential purposes, has been overlooked by the Appeal Court. The reversal of eviction decree on the ground of acquisition of alternate residential premises by defendant No.1-Raheja is, therefore, in excess of jurisdiction; b] That in absence of any material on record that defendant Nos.2 to 5 were paying any rent or compensation to defendant No.1-Raheja, the said defendant Nos.2 to 4 could have never claimed status of either sub-tenant or licensee, much less the status of protected sub-tenants or protected licensees. In fact, there is positive evidence, emanating from defendant No.1- Raheja that defendant Nos.2 to 5, were not paying any rent or compensation to him. Inasmuch as such vital material has been overlooked and the legal position arising therefrom misconstrued, there is clear jurisdictional error in the making of impugned judgment and order by the Appeal Court; c] The onus of establishing that they were sub-tenants or licensees, was squarely upon defendant Nos.2 to 5, who had raised such claim. The onus was of a considerably higher degree, considering the defence of defendant No.1-Raheja (original tenant) that defendant Nos.2 to 5 were not the sub- tenants or licensees, but merely some relatives of the partners 11/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 of M/s. Khemchand Tolaram, who according to defendant No.1-Raheja, was the original tenant in respect of suit premises. Defendant No.5, one of the legal heirs of the partners of said Firm, in the written statement, had made a categorical statement that no rents or compensation was ever accepted from defendant Nos.2 to 4 in respect of suit premises. Defendant Nos.2 to 5 did not even bother to step into witness box to discharge such onus. Mr. Walavakar submitted that the facts which are specifically within the knowledge of party, have to be proved by the said party, failing which, adverse inference is required to be drawn against such party; and d] The defendants in the suit raised multifarious, contradictory and mutually inconsistent defences. However, the defendants failed to establish any of the defences. Only the son of defendant No.1, on behalf of defendant No.1-Raheja, stepped into witness box and admitted that defendant No.1- Raheja is no longer in possession of the suit premises. Defendant Nos.2 to 5 did not even bother to step into witness box. In such circumstances, the Appeal Court, clearly exceeded its jurisdiction in reversing the Trial Court, which had made the decree for eviction. 12/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 19. Mr. P.S. Dani, learned senior advocate for respondent No.2- R.W. Raheja, submitted that the petitioners-landlords in their plaint had themselves alleged that defendant Nos.2 to 5 in the suit were sub-tenants in respect of suit premises and that defendant No.1 Raheja (original tenant) was indulging in profiteering of the rent. In terms of Section 15(2) of the Rent Act, sub-tenancies prior to 1 February 1973, were accorded statutory protection and therefore, the Appeal Court was right in extending such statutory protection to defendant Nos.2 to 5. Mr. Dani also submitted that there was no material on record to establish that the suit premises were initially let out to defendant No.1-Raheja (original tenant) for residential purposes. The Trial Court, in fact, incorrectly declined to answer the issue as to the purpose for which the suit premises were initially let out. The decree on the ground of acquisition of alternate accommodation was incorrectly made, inasmuch as the provisions contained in Section 13(1)(l) of the Rent Act apply only in respect of residential premises. In any case, Mr. Dani submitted that even if the tenancy of defendant No.1- Raheja may have been validly terminated, in terms of provisions contained in Section 14 of the Rent Act, defendant Nos.2 to 5 become the direct tenants of the petitioners-landlords. For all these reasons, Mr. Dani submitted that 13/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 there is no case made out to interfere with the decisions taken by the Appeal Court, particularly considering the limits of supervisory jurisdiction of this Court under Article 227 of the Constitution of India. 20. The rival contentions now fall for determination. 21. The Appeal Court, in the impugned judgment and decree dated 14 December 1992 has almost entirely relied upon the contents upon the notices dated 26 November 1966 and 27 October 1971 , in which, the landlords had alleged that defendant No.1- Raheja (original tenant) had partitioned the suit premises into four compartments and had sublet each of such compartments to defendant Nos.2 to 5 and thereby indulged into profiteering. Relying upon such allegations in the two notices, the Appeal Court has concluded that defendant Nos.2 to 5 were indeed the subtenants or in any case licensees in respect of suit premises prior to 1st day of February 1973 and therefore, were entitled to the protection by Section 15(2) of the Rent Act and consequently were not liable to be evicted under Section 13(1)(e) of the Rent Act. 14/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 22. The Section 15 of the Rent Act, reads as under : 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 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 [leases or class of leases [or the giving on licence any premises or class of premises] and to 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 of a Court, any such sub-lease, assignment or transfer of any such purported 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-lease, 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. 15/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 The provisions aforesaid of this sub-section shall not affect in any manner the operation of sub-section (1) after the [date aforesaid]. 23. The Section 15A of the Rent Act, reads thus: 15A. Certain licensee in occupation on 1st February 1973 to become tenants. - (1) Notwithstanding anything contained elsewhere in this Act or anything contrary in any other law for the time being in force, or in any contract, where any person is on the 1st day of February 1973 in occupation of any premises, or any part thereof which is not less than a room, as a licensee he shall on that date be deemed to have come, for the purposes of this Act, the tenant of the landlord, in respect of the premises or part thereof, in his occupation. (2) The provisions of sub-section(1) shall not affect in any manner the operation of sub-section (1) of section 15 after the date aforesaid. (emphasis supplied) 24. Although, there is no definition of the expression 'subtenant' contained in the Rent Act, Section 5(11) of the Rent Act defines the expression 'tenant' to mean any person by whom or on whose account rent is payable for any premises and includes such sub- tenants and other persons as have derived title under a tenant before the 1st day of February 1973. The expression tenant also includes any person to whom interest in premises has been assigned or transferred as permitted or deemed to be permitted, under Section 15. The expression tenant also includes such licensees as are deemed to be tenants for the purposes of Rent Act by Section 15A. Suffice to 16/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 note at this stage that one of the essential ingredient to be fulfilled before a person can claim to be a tenant or a subtenant for the purposes of Rent Act is that, such person should be one by whom or on whose account rent is payable for any premises. 25. The expression 'licensee' is defined under Section 5(4A) of the Rent Act in respect of any premises or any part thereof, means the person who is in occupation of the premises or such part, as the case may be, under a subsisting agreement for licence given for a licence fee or charge and includes several persons specifically referred to in the definition clause. Thus, before a person can claim status of a licensee, such person has to establish that he is in occupation of the premises or part thereof under a subsisting agreement or licence given for a 'licence fee' or 'charge'. 26. Section 15(2) of the Rent Act, no doubt, exempts from the prohibition against the subletting of the whole or any part of the premises, which have been let out to any tenant, provided, such subletting, assignment or transfer has taken effect before 1st February 1973 in the area in which the Rent Act was in operation and further provides that any sub-lease, assignment or transfer 17/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 before such date shall be deemed valid and effectual for all purposes and any tenant who has sublet any premises or part thereof assigned or transferred any interest therein, shall not be liable to eviction under Section 13(1)(3) of the Rent Act. 27. So also, Section 15A of the Rent Act provides that where any person is on the 1st day of February 1973 in occupation of any premises, or any part thereof which is not less than a room, as a licensee he shall on that date be deemed to have be come, for the purposes of the Rent Act, the tenant of the landlord, in respect of the premises or part thereof, in his occupation. 28. Thus, on the basis of provisions contained in Section 15(2) and Section 15A of the Rent Act, if, a person is in occupation of any premises or part thereof any area to which the Rent Act applies prior to 1st February 1973 as a sub-lessee or a licensee, then such person can claim the status as a tenant for the purposes of Rent Act. In order to sustain such a claim, however, it is imperative that such a person has to establish that he was indeed occupying the premises or any part thereof as a sub-tenant or a licensee as such terms are understood and defined for the purposes of Rent Act. It follows 18/36 DSS J-wp-5339, 5247, 5337,5338 & 5340-93 therefore, that such person, if he claims to be a sub-tenant, has to establish that he was a person by whom or on whose account rent was payable for such premises. If such person claims to be a licensee, then he has to establish that license was given for a license fee or a charge. Unless, these vital ingredients are satisfied, no person merely on the basis of his occupation of the premises prior to 1st February 1973 can claim the protection under Section 15(2) or Section 15A of the Rent Act. 29. The aforesaid position is no longer res integra. 30. In the precise context of Section 15A of the Rent Act, the learned Single of this Court