Case: A. MAHALAKSHMI Vs. BALAVENKATRAM(D) THROUGH LR

2. The facts leading to the present appeal in nutshell are as under:That one Dr. Sanjeevi and his wife Mrs. Porkodi, the earlier owner of the suit premises in question had executed a power of attorney dated 01.11.2016 in the name of the appellant herein and in respect of the said property. That by way of rental agreement dated 23.05.2007, the appellant let out the premises in question to original respondent no.1 herein – Bala Venkatram (now dead and represented through legal heirs) for running Best Mark Super Market from June, 2007 to July, 2009 on a monthly rent of Rs.11,000/-. That an advance amount of Rs.1,00,000/¬ was paid by way of security. That the rent was payable on 7 th day of every English calendar month. That the appellant – landlady filed an eviction suit on the ground of sub¬letting as well as on the ground of arrears of rent against the respondents herein – original defendants – Bala Venkatram and another under Sections 10(2)(i), 10(2)(ii)(a)(b) and 10(2)(iii) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 (hereinafter referred to as the Act) in the Court of District Munsiff, Pollachi. According to the landlady the rent was initially paid by original defendant no.1 – Bala Venkatram till October, 2007. It was the case on behalf of the landlady that upon default in payment of rent and noticing a change in the name as well as ownership of the shop in the tenanted premises from Best Mark Super Market to Amutham Super Market, she made enquiries and discovered that not only there was a change in the name but a complete change of hand from original defendant – Bala Venkatram to respondent no.2 – Shahu Hameed which also on the face of it was a gross breach of the rent agreement. According to the landlady, the sub-letting was evident from the Certificate of Registration, Government of Tamil Nadu, Commercial Tax Department. Therefore, the landlady issued a legal notice to original defendant – Bala Venkatram pointing out the said breaches and called upon him to collect balance amount from the advance payment deposited after adjusting the arrears of rent and handover possession of the tenanted premises within 15 days failing which the appropriate legal action would be taken. There was no reply to the legal notice from respondent no.1 – original defendant no.1. Therefore, the landlady, the appellant herein, filed R.C.O.P. No. 4 of 2008 for decree of eviction on the ground of sub-letting and arrears of rent2.1 The suit was resisted by original defendant no.1 – the original tenant by filing a written counter. It was stated that the landlady has received the rent till December, 2007 and that the first respondent has no necessity to get the permission from the landlady for running business in any other name. It was the case on behalf of original respondent no.1 – the original tenant that since the landlady was trying to evict the respondents, they filed O.S. No. 122/2008 for permanent injunction. According to the first respondent – the original tenant, they were running Amutham Super Market in the suit property. According to the original tenant there were many branches, namely, Amutham Jewellery, Amutham Foods, Amutham Electronics, Amutham Textiles etc. According to the original tenant since the respondents refused to give the business in the name of the landlady, she filed eviction petition with an ulterior motive. A similar written counter was filed on behalf of original respondent no.2 – sub¬tenant2.2 That the learned Rent Controller dismissed the eviction petition. Aggrieved by the same, the landlady preferred R.C.A. No. 1 of 2012. That the learned Rent Control Appellate Authority allowed the appeal in part. The learned Rent Control Appellate Authority passed the eviction decree on the ground of sub¬letting only and therefore allowed the petition filed under Sections 10(2) (i) and 10(2)(ii)(a)(b) of the Act. However, dismissed the petition filed under Section 10(2)(iii) of the Act – wastage & material alteration of the premises. That the original tenant – Bala Venkatram died. Therefore, the legal heirs of the original tenant – Bala Venkatram and the second respondent – sub¬tenant preferred the revision application before the High Court. That by the impugned judgment and order, the High Court has allowed the said revision application and has quashed and set aside the eviction order passed by the Rent Control Appellate Authority2.3 Feeling aggrieved and dissatisfied with the impugned Judgment and order passed by the High Court in quashing and setting aside the eviction decree on the ground of sub¬letting, the landlady has preferred the present appeal.

Reasoning: 6.1 At the outset, it is required to be noted that the suit premises was leased in favour of original respondent no.1 – original tenant – Bala Venkatram pursuant to the rental agreement dated 23.05.2007 executed by the appellant herein. Therefore, the rental agreement was between the appellant and original defendant no.1 – Bala Venkatram. Defendant no.1 was put in possession as a tenant pursuant to the aforesaid rental agreement dated 23.05.2007 executed by the appellant in favour of original defendant no.1 – original tenant – Bala Venkatram. Therefore, as such, it would not be open for the respondents to deny the status of the appellant as a landlady. Therefore, the original respondents cannot challenge the authority of the appellant to file an eviction petition. Even otherwise, considering Section 2(6) of the Act and considering the fact that respondent no.1 was paying the rent to the appellant pursuant to the aforesaid rental agreement dated 23.05.2007, the appellant can be said to be the landlord/landlady and therefore the eviction petition at the instance of the appellant would be maintainable. At this stage, it is required to be noted that as such no such objection was raised either before the High Court and/or before the Rent Control authorities. Be that as it may, as observed hereinabove, the appellant can be said to be the landlady even within the definition of Section 2(6) of the Act and therefore the eviction petition at the instance of the appellant would be maintainable7. It is not in dispute that in the rental agreement dated 23.05.2007, the suit premises was let out to respondent no.1 – the original tenant for running Best Mark Super Market for a period of two years from June, 2007 to July, 2009. However, it has been found that in the suit premises, respondent no.2 was running the business in the name of Amutham Super Market and the original tenant was confronted with the same and was served with a legal notice, initially original respondent no.1 – tenant did not respond to the legal notice. However, before the Rent Control Authority, it was the case on behalf of respondent No.1 – Bala Venkatram that because of the old age he was not in a position to manage the affairs of the shop and that is why he has handed over the possession of the shop to Shahu Hameed – original respondent no.2 through a general power of attorney. It was also the case on behalf of the original tenant that on the basis of an oral agreement, he and Shahu Hameed were running the business as partners. However, in the cross¬examination, the original tenant has specifically admitted that in the bank accounts of the firm – Amutham Super Market, Shahu Hameed is shown as the owner of the shop. He has also admitted that licence for the shop is also in the name of Shahu Hameed. He has also specifically admitted that Shahu Hameed is running the shop as the owner. He has also specifically admitted that he is not in possession of any document to show that he is running the shop. He has also specifically admitted that he has handed over the shop to Shahu Hameed through a power of attorney. He has also specifically admitted that the application/sales tax certificate in respect of the suit property is registered in the name of Shahu Hameed. He has also specifically admitted that the bank accounts are maintained by Shahu Hameed in the capacity of owner of the shop. Thus, from the deposition of original respondent no.1 – the original tenant and the material/evidence on record, we are of the opinion that this is a clear case of sub¬ letting. All the ingredients suggesting sub¬letting are established and proved. As such, the High Court has not at all discussed the evidence on record including even the deposition of original respondent no.1 – the original tenant8. Sub¬letting means transfer of an exclusive right to enjoy the property in favour of the third party. To constitute a sub¬letting, there must be a parting of legal possession, i.e., possession with the right to include and also right to exclude others. Sub¬letting, assigning or otherwise parting with the possession of the whole or any part of the tenancy premises, without obtaining the consent in writing of the landlord, is not permitted and if done, the same provides a ground for eviction of the tenant by the landlord. When the eviction is sought on the ground of sub¬ letting, the onus to prove sub-letting is on the landlordAfter considering catena of decisions of this Court on sub-letting, in the case of Celina Coelho Pereira v. Ulhas Mahabaleshwar Kholkar, (2010) 1 SCC 217 , this Court has summarised in paragraph 25 as under:25. The legal position that emerges from the aforesaid decisions can be summarised thus :(i) In order to prove mischief of subletting as a ground for eviction under rent control laws, two ingredients have to be established, (one) parting with possession of tenancy or part of it by tenant in favour of a third party with exclusive right of possession and (two) that such parting with possession has been done without the consent of the landlord and in lieu of compensation or rent(ii) Inducting a partner or partners in the business or profession by a tenant by itself does not amount to subletting. However, if the purpose of such partnership is ostensible and a deed of partnership is drawn to conceal the real transaction of sub¬letting, the court may tear the veil of partnership to find out the real nature of transaction entered into by the tenant(iii) The existence of deed of partnership between tenant and alleged sub-tenant or ostensible transaction in any other form would not preclude the landlord from bringing on record material and circumstances, by adducing evidence or by means of cross¬ examination, making out a case of sub¬letting or parting with possession in tenancy premises by the tenant in favour of a third person(iv) If tenant is actively associated with the partnership business and retains the control over the tenancy premises with him, may be along with partners, the tenant may not be said to have parted with possession(v) Initial burden of proving subletting is on landlord but once he is able to establish that a third party is in exclusive possession of the premises and that tenant has no legal possession of the tenanted premises, the onus shifts to tenant to prove the nature of occupation of such third party and that he (tenant) continues to hold legal possession in tenancy premises(vi) In other words, initial burden lying on landlord would stand discharged by adducing prima facie proof of the fact that a party other than tenant was in exclusive possession of the premises. A presumption of sub-letting may then be raised and would amount to proof unless rebutted9. Applying the law laid down by this Court in the aforesaid decisions to the facts of the case on hand and on appreciation of evidence on record, we are of the opinion that there is no genuine partnership between respondent no.1 and respondent no.2. Respondent no.1 has come out with a case of partnership only to get out from the allegation of sub¬letting. The exclusive possession of the suit premises is with respondent no.2. Respondent no.2 is running the business in the suit premises as an owner. Sales Tax Certificate and the licence are in the name of respondent no.2. The bank accounts are in the name of respondent no.2 and respondent no.2 is exclusively dealing with the bank accounts. Under the circumstances, a clear case of sub-letting has been made out. The High Court has committed a grave error in setting aside the decree of eviction on the ground of sub¬letting.