Dharam Chand and Others vs Smt. Chander kala and Another

Gokal Chand Mital, J.—The landlords sought ejectment of Gian Chand tenant on the pleas that he had sub-Jet the shop to Sarvshri Dharara Chand, Manohar Lal sons of Chuni Lal and Malawa Ram son of Bisanda Ram. who were carrying on business in the name and style of Manohar Stores. In case M/s. Manohar Stores is proved to be a partnership firm, since the tenancy was only given to Gian Chand ejectment is sought on the ground of sub-letting to Dharam Chand, Manohar Lal sons of Chuni Lal and Malawa Ram son of Bisanda Ram and for non-payment of rent. In highlighting the facts of sub-eiting, it was pleaded that Gian Chand was the tenant whereas the sub-tenants were carrying on business in the name and style of Manohar Steres. In the alternative it was pleaded that if it is proved that Manohar Stores was proved to be the tenant, yet order of ejectment on the ground of sub-letting was liable to be passed because M/s. Manohar Stores partnership firm stood dissolved and, therefore, the occupation of the erstwhile partners was by way of sub-letting. In the written statement it was pleaded that M/s. Manohar Stores had taken the premises on rent on 1-5-1961 through Manohar Lal as partner of the firm. It was further pleaded that Gian Chand may have executed a rent note later on as partner of the aforesaid firm and he never executed any rent note in his individual/personal capacity, and that is why the rent note alleged to have been executed by Gian Chand was being withheld by the landlords. It was a definite plea that firm M/s. Manohar Stores was the tenant from the very beginning and continued to be the tenant and its erstwhile partners along with the wife or children of some of them continued to be partners of the new firm which was being carried on at the time of filing of the ejectment petition. The arrears of rent were tendered by the firm which tender was not accepted by the landlords.

Both the Courts below ordered ejectment on both the grounds after recording a finding that Gian Chand was the tenant in his individual capacity on the basis of rent note dated 8-6-1964 for the proof of which secondary evidence was led as the original was not traceable and since the tender was made by the firm it was held to be invalid. This is revision by the partners of M/s. Manohar Stores who are alleged to be the sub-tenants.

The matter was not considered and appreciated by the two Courts below in its true and correct perspective and that is why they were completely misled in going into matters which were wholly unnecessary and in ignoring the real points involved in the controversy. Rent note Exhibit R 2 is dated 1-5-1961. Regarding this a definite plea was taken by the tenants in the written statement and that plea in replication was not controverted in the manner it should have been done. In fact the evasive reply will have to be treated as admission of the plea raised in the written statement about the rent note dated 1-5-1961. In any event from the evidence on record, the execution of the rent note dated 1-5-1961 is amply proved and this point is beyond the pale of controversy. A reading of the rent note shows that the tenancy was taken by Manohar Stores Cloth Merchant, Bhiwani, through Manohar Lal son of Chuni Lal, Hissar. If the recital in the rent note had been that Manohar Lal son of Chuni Lal partner of M/s. Manohar Stores was taking the premises on rent, then certainly it could be held that Manohar Lal took the premises on rent in his individual capacity. It is patent that M/s. Manohar Stores took the premises on rent through one of its partners. Therefore, from 1-5-1961 it will be deemed that the partners who were in existence at that time would be the tenants.

In spite of the plea of the tenants that the firm took the premises on tenancy on 1-5-1961, no plea was taken by the landlords that the firm gave up the tenancy. In the absence of plea of the tenancy dated 1-5-1961 coming to an end, that tenancy will continue till determined either in accordance with law or by act of the parties. While the tenancy dated 1-5-1961 continued in favour of the partners of the firm, even if it is assumed that another rent note dated 8-6-1964 was written by Gian Chand, who was one of the partners on 1-5-1961 and continued to be the partner on 8-6-1964, the original tenancy dated 1-5-1961 would remain in force. Merely by execution of a rent note by Gian Chand one of the partners, even if it is in his own personal capacity, would not bring to an end the tenancy dated 1-5-1961. The tenancy dated 1-5-1961 could be brought to an end by all the partners of the firm and not by one of them. Unfortunately, the rent note which is alleged to have been executed by Gian Chand has not been placed on the record and from secondary evidence, effort was made to prove that the rent note was not executed on behalf of the firm but by Gian Chand in his personal capacity as partner of M/s. Manohar Stores. Assuming that it is so on the basis of the original rent note dated 1-5-1961 the then partners or any one of them was entitled to continue in occupation of the premises and this would not amount to sub-letting. Even if one of the then partners joins others with him in the business, it does not amount to subletting. It has been ruled by the Supreme Court in Murli Dhar v. Chuni Lal 1970 R. C. J. 922, that even if one of the partners of the original firm continues to be in occupation of the shop as a partner of the new firm along with new partners, there would be no sub-letting. The relevant observations are as follows:

It appears that two contentions were raised in the High Court both of which were rejected. The first was that the possession of the premises by new firm proved sub-letting. The contention appears to have been that the old firm and the new firm being two different legal entities, the occupation of the shop by the new firm was occupation by the legal entity other than the original tenant and such occupation proved sub-letting. This contention is entirely without substance. A firm unless expressly provided for the purpose of any statute which is not the case here, is not a legal entity. The firm name is only a compenduous way of describing the partners of the firm. Therefore, occupation by a firm is only occupation by its partners. Here the firms have a common partner. Hence, the occupation has been by one of the original tenants.

The other point was that since Meghraj entered into a new partnership with a stranger, there was sub-letting to the new partnership. It seems to us that the point sought to be made was that when Meghraj was in possession as the partner of Meghraj Bansidhar, he was in possession of the shop in a capacity different from that in which he was in possession as a partner of Chuni Lal Gherulal. This is clearly fallacious. Meghraj was in possession all through in his individual capacity. It is impossible to treat him as possessing one legal personality as member of one firm and another such personality as member of another firm.

It seems to us that the landlord cannot succeed. He has to prove it as a fact that there was a sub-letting by his tenant to another person. He does not prove this merely by showing that his tenant was one firm and the premises are in the occupation of another firm, as he sought to do in the present case. Mere possession by somebody other than the tenant would not necessarily prove that the premises had been sub-let by the tenant to the person in possession. It is admitted that there is no evidence in this case to prove the fact of sub-letting. In this case in particular, the premises continued in possession of one of the original tenants, Meghraj.................

The aforesaid view has been reiterated in M/S Madras Bangalore Transport Company (West) v. Inder Singh .

Now I may refer to the facts of the present case to show that they are quite similar to the aforesaid cases. When the shop was taken on rent by M/s Manohar Stores vide Exhibit R. 2 on 1.5.1961, the partners were Dharam Chand, Manohar Lal and Gian Chand sons of Chuni Lal and Malawa Ram son of Bisanda Ram. By the time ejectment petition is filed, Gian Chand ceased to be the tenant and the remaining three partners continued in the business in the same firm. During the pendency of the ejectment proceedings Manohar Lal died and his daughter was made partner and she continued as partner of the firm along with Dharara Chand and Malawa Ram. So long as any one of the original partners of the 1961 firm or their legal rerpesentatives, who are entitled to continue in possession as tenants in accordance with the provisions of Haryana Urban (Control of Rent and Eviction) Act, 1973. remained in possession of the premises no case for sub-letting would be made out.

The Courts below were impressed by the filing of the application for fixing of fair rent by the landlords copy of which is Exhibit P. 1, against Gian Chand alone, who was shown as a tenant, in which counsel for Gian Chand had made the following statement:

Stated that we are tenants on the shop since I960. Fair rent may be fixed in accordance with law. It is wrong that I am tenant since 1964.

The foresaid statement and the filing of the application has been taken by the Courts below to mean as if it was admitted that Gian Chand alone was the tenant. On the contrary a reading of the afore-quoted statement shows that the words ''we tenants'' shows that there were more than one tenants and this finds amole support from the fact that it is categorically denied that Gian Chand was the tenant since 1964 because Gian Chand has reference to ''I''. There is no doubt that from 1961 (wrongly stated to be 1960) the firm was tenant in which there were four partners including Gian Chand. Totally wrong inference has been drawn by the Courts below in coining to the conclusion that Gian Chand was the sole tenant.

For the reasons recorded above, the finding of the two Courts below on the point of sub-letting is hereby reversed.

In view of the aforesaid finding it is agreed that the tender of rent is valid. Finding on this matter is also reversed.

As a result, the revision is allowed, the orders of ejectment parsed by the two Courts below arc hereby set aside and the landlords'' application for ejectment is dismissed with costs troughout.