Case: P. John Chandy And Company (P) Ltd Vs. John P. Thomas

3. The facts which do not admit of dispute are that the accommodation in question originally belonged to the grand father of the present respondent, who died in the year 1953. It came down to the father of the respondent who also died some time 1976. The property ultimately came to the respondent. In the year 1949 Shri P. George, grand father of the respondent rented out the premises to the appellant-company which was sub-let to different sub-tenants from time to time. The respondent gave notice to the appellant on 17.11.1981 to terminate the sub-lease arrangements but the tenant failed to comply with the notice. Ultimately John P. Thomas-respondent filed RCP No. 16 of 1982 in the Court of Rent Controller. Kottayam. The eviction was sought on the ground that the appellant-tenant had transferred his rights creating sub-leases in favour of several persons without the consent of the landlord. One of the sub-tenants had even been running a printing press in the premises whereas according to the case of the landlord the premises were let out to the appellant for its use as an office and godown. The petition was contested but the fact of sub-letting was not denied. On the other hand, it was pleaded that one sub-lease was created initially in 1949 itself when the premises were taken by the appellant on rent which fact was within the knowledge of the grand father and the father of the respondent as well as that of the present respondent. Admittedly, a few more sub-leases were created in 1970s. Nobody ever objected to the same. It could thus well be presumed that the landlord had consented to the sub-letting which was within their knowledge. There does not seem to be any document of lease. The appellant also produced one CPW2 in evidence who had been one of the Directors of the appellant Co. from 1946 to 1960. According to him negotiations of rental arrangement took place in his presence and the arrangement of letting included sub-letting as well.  4. The Rent Controller on consideration of the evidence adduced by the parties as well as other material on the record came to the conclusion that there has not been any positive conferment of right upon the appellant to sub-let or transfer the rights under the lease. While appreciating the evidence the trial court observed that in so far the evidence of CPW2 is concerned, in cross-examination has stated that there was no document of lease and had no knowledge whether any decision was taken by the Board of Directors of the Company in regard to the tenancy or the terms thereof. He also stated that terms of rental arrangement were not discussed and there was no evidence on record which may have been kept in the records of the company regarding the same nor he remembered what happened in 1949. The trial court considering other parts of his statement as well found that his evidence was unworthy of credence and that of an interested person and observed therefore I dis-believe CPW2 and render his evidence as unreliable. The petition thus filed by the respondent - landlord was allowed holding that there was no consent of the landlord for sub-tenancies created by the appellant.  5. The tenant filed an appeal before the Rent Control Appellate Authority, Kottayam. The appeal was allowed by order dated February 21, 1992. The appellate court recorded a finding to the effect in the absence of any evidence either oral or documentary the terms of tenancy have to be gathered from the long course of conduct of the parties ever since commencement of the tenancy in 1949. The appellate court considering the facts and circumstances that the sub-lease was coming down since long within the knowledge of the landlord and they having never raised any objection, by their conduct it could be inferred that the landlord had consented to the sub-letting. The appellate court then also referred to the statement of CPW2 who was formerly one of the Directors of the appellant company and was related to the parties and according to whom the rent arrangement was made in his presence which enabled the tenant-appellant to sub-let the premises. The appellate court ultimately held that having regard to the long course of conduct of parties it was satisfied that contract of tenancy allowed sub-letting by the tenant. It further observed even assuming that there was specific stipulation in the contract of tenancy prohibiting sub-letting, the landlord by acceptance of rent must be deemed to have waived his right to claim eviction on the ground of sub-letting...  6. Aggrieved by the order passed by the appellate authority the respondent preferred a revision under Section 20 of the Kerala Buildings (Lease And Rent Control) Act 1965. The revision was allowed as indicated earlier holding that the sub-leases were created in contravention of Section 11(4)(i) of the Act. The revisional court found that the tenant failed to establish that in terms of lease they were entitled to sub-let the accommodation. Mere inaction or failure on the part of the landlord to initiate any action in the matter would not amount to conferment of right on the tenant under the lease to sub-let nor waiver of the right of the landlord to get the premises vacated could be inferred.

Court's reasoning:
The tenancy is created after 1965 in the years 1971, 1972 and 1974 would clearly be subject-matter of incurring the liability of the tenant to hand over the possession to the landlord. In this context the observations made by the appellate court that no objection was taken by the landlord for the last 32 years is not correct. The respondent had served a notice on the appellant-tenant in 1981 which is period of 10 years from 1971 and 7 years from 1974. It is in so far factual position and finding of inaction for 32 years on the part of the landlord is concernedThe landlord had also started accepting the rent tendered by the tenant in the name of the registered society. It was held that no inference of authorised sub-tenancy could be drawn nor inference of implied consent and it was held that the landlord was not estopped from seeking eviction on the ground of unauthroised sub-letting. The conduct of the landlord in accepting the rent from the society was held to be of no consequence. We have already observed earlier that the inference drawn from findings of fact is a legal question. It would not amount to interfering or substituting the finding of fact by revisional court. Hence the decision in the case of Ubaiba (supra) relied upon by the learned counsel for the appellant would not be of any assistance to itwe find no reason to interfere with the order passed by the High Court setting aside the orders of the appellate authority and upholding the orders of the trial court, refusing to draw any inference of implied consent on the basis of inaction or conduct of the landlord. The consent as envisaged under Section 11(4)(i) of the Kerala Buildings (Lease and Rent Control) Act 1965 would mean consent with some positive act which may lead to inference of conferring right on the tenant to sub-let the premises and mere inaction would not be sufficient to amount to implied consent on the part of the landlord.