Sardar Ajitsingh Matharu vs Saibaba Co-operative Housing Society Ltd.

V. S. Deshpande, J.—These four Revision Applications involve identical facts and raise an interesting question of law of some importance as to the true interpretation of sections 5 (3) and (11) (bb), 4A and 15A of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 (hereinafter referred to as ''the Rent Act'') introduced therein by Amendment Act No. 17 of 1973. Respondent No. 1 in all these cases is a Housing Co-operative Society (hereinafter referred to as ''the Society''). Respondent No. 2 therein were the members of the said Society and entitled to occupy the concerned flats in the buildings, admittedly owned by the said Society, as such members and shareholders and allottees thereof. Petitioners in all these four cases were in possession thereof as licensees of these respondent No. 2 members on 1-2-1973 when the Rent Act was amended as above. Without quoting the amended provisions in extenso, it will be enough to notice that the word ''landlord'' in section 5(3) now includes a licensor whose licensee could be deemed to be a tenant u/s 15A of the Rent Act. The section 4A defines the word ''Licensee'' as the person in occupation of any premises under a subsisting licence (i.e. on 1-2-1973) in a building including the one vested in or leased to the Society. u/s 15A, such licensees are deemed to be tenants within the meaning of the Rent Act, provided (1) the portion of the premises occupied by such a licensee does not happen to be less than a room and (2) the occupation of the same continues on 1-2-1973 under the subsisting agreement of licence. Section 5(11)(bb) includes, such deemed tenants, within the definition of "tenant" itself.

The Society in this case succeeded in securing awards in eviction proceedings u/s 91 of the Maharashtra Co-operative Societies Act of 1960 (hereinafter referred to as ''C. S. Act'') against its members respondents for possession on 24-3-1974. The awards were ex-pane, as the defendant members impleaded therein chose not to contest and the petitioner the Licensees-were not impleaded as parties to the said eviction proceedings in spite of their being in actual possession. On certificate from the Registrar, the awards were sought to be executed through the City Civil Court in four Darkhast proceedings. The petitioner licensees obstructed delivery of possession. The Society then took out chamber summons for removing the obstructions against these four licensees and two others against whose licensor''s also ex-parte awards were secured by the Society. The learned Judge at one stage rejected the said summonses on the technical ground that such obstruction was not alleged to be at the instance of the judgment-debtors. This order was set aside by this Court, directing the Court to dispose of the Chamber Summonses on merits. The sum and substance of the say of the petitioners is that licensees like the petitioners were protected by the amended Rent Act, they having become the tenants u/s 15A read with section 5(11)(bb) thereof and were not liable to be evicted excepting in execution of a decree against them by recourse to the provisions of the Rent Act from the Court u/s 28 thereof. The learned trial Judge on remand held inquiry in compliance with the order of this Court, and by his impugned order upheld the claim of the decree-holder Society that the petitioners claiming as they did through the judgment-debtors-members, were bound by the award notwithstanding their not having been impleaded as party to the said proceedings and as such were liable to be evicted in execution of awards obtained by the Society against the members thereof. Validity of this order dated 7-7-1976 is challenged in these revision applications.

The contention of Mr. Pratap, the learned advocate appearing for the petitioners, that the question of removal of obstruction of the persons like the petitioners under Order XXI, Rule 97 read with Rule 98 cannot arise unless it being alleged and proved to be at the instigation and on behalf of the judgment-debtor, does not call for serious consideration. As observed by the trial Judge provisions of Order XXI, Rules 35, 36, 97, 98 and 99 shall have to be read together and the petitioners would be liable to be evicted and their obstruction liable to be removed, if it is found that they are claiming through the judgment-debtors and as such bound by the award even if they were not impleaded as parties to the eviction proceedings. Another contention of Mr. Pratap that the petitioners'' claim for protection under the Rent Act raises several complicated questions and therefore the Court should have directed the Society to get these issues tried in civil Court and should have stayed its hands, is as untenable as the equally misconceived contention of Mr. Sakhardande the learned Advocate for the Respondents that revision application were not maintainable when remedy of suit is available to the petitioners under Order XXI, Rule 103.

There is practically no dispute as to the material facts. Respondents 2 in all these cases are not owners but the allottees of the flats in dispute in the building, which admittedly belongs to the Society. Co-operative Societies Act and the Rules framed thereunder contemplate different kinds of Housing Co-operative Societies. Rule 10 deals with classification of the Societies. At serial No. 5 Housing Societies are divided into three categories. Respondent No. 1 Society admittedly is a tenant Co-partnership Housing Society, which in terms of the classification under clause 5 of Rule 10 happens to be the one, which held both land and buildings thereon, on leasehold or freehold basis and allot them flats therein to their members. Respondents No. 2 the allottees are entitled to the possession of the respective flats by virtue of being members and, holding of shares in the Society as such members. These members did grant licences to the petitioners respectively without written permission of the Society as required, and the petitioners were in possession of the premises on the crucial date 1-2 1973 as such licensees under the subsisting agreement of licence. But now Society has obtained awards against these members. Though members did not care to appear and contest, there is nothing to infer that awards are collusive. It is competent for the Society to proceed against its members for their eviction u/s 91 of the C. S. Act on grounds available under the said Act, Rules, Bye laws of the Society and Tenancy Regulations and execute awards so obtained against them, through the concerned civil Court on a certificate from the Registrar, Co-operative Societies, and the award can be executed against such members and other persons claiming through them, even if they were not impleaded to the eviction proceedings, howsoever desirable or proper, their such impleading may be felt by anyone. The petitioners however, can claim immunity from enforcement of the award against them only if they can plead and prove right to occupy the flats independently of such members through whom they entered in the flats.

The only question that arises on these facts is if the licensees-petitioners can be said to be claiming through their licensors, who happen to be judgment-debtors in the awards under execution. This, to my mind, appears to be purely a simple legal question, admitting of not much inquiry or any serious complicated point. I do not think it proper to set aside the order merely on the technical point of the supposed inability to dispose of these objections of the licensees under Order XXI, Rules 97, 98 and 99 nor do I consider it advisable to reject these revisions merely on the ground that the remedy of a Regular Civil Suit is also available to the petitioners.

Real question is: can these petitioners licensees claim any independent right to the possession of the flats apart from the licensees of the judgment- debtors-members? If they can so claim such right independently of its origin in the grant of the licence by the judgment-debtors, they can effectively resist the execution of, eviction award, as being in possession in their own such independent right in spite of the origin being in the grant of licence by the judgment debtors. Mr. Pratap contends that this is what the Rent Act seeks to achieve, in regard to lawful sub-tenants, and now in regard to lawful licensees by the Amendment Act No. 17 of 1973 by conferring tenancy rights on all such, licensees u/s 15A read with section 5(11)(bb) of the Rent Act. That petitioners become such statutory tenants of the members of the Society and therefore can claim protection under the Rent Act including immunity from eviction except as provided in the Rent Act against their licensor, i. e, the members of the Society admits of no doubt. The definition of ''Licensee'' u/s 4A includes licensees of any portion of a building vested in or belonging to a Co-operative Society and the area in dispute admittedly happens to be more than of one room as conceived u/s 15A. Section 5(11)(bb) read with section 15A makes such licensee''s tenants of the members of the Cooperative Society enabling them to claim every protection like any other tenant against such members, i. e. their landlord under the Rent Act.

We are, however, not concerned here with any award, in favour of their licensor-member directing their eviction. The Award-holder is the Cooperative Society itself and it is not and cannot claim to be the landlord of the petitioners. The petitioners cannot claim any such protection or immunity against eviction against such Society, in spite of the Amendment in the Rent Act. Admittedly the Society is the owner and consequently the landlord of the fiats but the petitioners do not owe their right to possession, to the Society. Amended section 5 (3) of the Act includes such licensor members also in the definition of the landlords of such licensees but does not make Society itself their landlord. The licensor-members are not the tenants of the Society, though the Bye-laws and the Tenancy Regulations of the Society loosely so describe them to be so and the petitioners, therefore, cannot claim to be their sub-tenants. There exists no relationship of landlord and tenant, as understood under the Transfer of Property Act or the Rent Act, between the Society and its members, as also between the Society and the petitioners. That is what is expressly held by this Court in Full Bench case of Manohar v. Konkan Co op. Housing Society 1962 N L J 133 : 63 Bora. L R 1001 and by the Supreme Court in the case of Baburao Shantaram v. Bombay Housing Board 56 Bom. L R 286 at page 290, and followed by me sitting with Dudhia J. in the case of Kalawati Ramchand v Shankarrao 1974 Mh. L J 908 : 76 Bom. L R 718. The member''s licensee thus is not protected from the eviction claim of the Society on the termination on such member''s interest in the flat by the Society in accordance with C. S. Act, Bye-laws and Tenancy Regulations of the Society. The licensee''s interest created by such licensor-member comes to an end with the member''s interest in the flat under the award so obtained by the Society against its member and it equally binds the licensees-petitioners under Order 21, Rules 35 and 36 and obstruction raised by such licensee is liable to be removed by the Court under Order XXI, Rules 97 and 99. There exists no privity of contract between the Society and the licensee of the member, to set up any claim independently of such member.

Mr. Pratap, however, contends that, if sub-tenant is made entitled to protection of the Rent Act on termination of interest of the head-tenant through whom such sub-tenant comes to occupy the flat, under the Rent Act in spite of there being no privity of contract between the landlord and such subtenant, there is no reason why licensee lawfully introduced in the flat by the Society''s members should not get protection of the Rent Act against the Society the owner of the flat. In this connection the contention of Mr. Sakhardande that the transfer of possession by the member to any stranger without the previous written consent of the Society makes the transaction of licence itself illegal, is not tenable and can be easily overruled. Bye-laws or the Tenancy Regulations of the Society cannot claim the force of law so as to bind the strangers non-members like the petitioners. See Co-operative Central Bank Ltd. and Others Vs. Additional Industrial Tribunal and Others, . This, however, cannot be of any practical assistance to Mr. Pratap. Sub-tenant becomes the tenant of the landlord by virtue of section 14(1) in spite of absence of privity of contract between them on termination of tenant''s tenancy provided the creation of sub-tenancy itself is not illegal and not prohibited by law. Unfortunately sub-section (2) of section 14 specially introduced under Amendment Act 17 of 1973 does not cover the licensee from the member of the Society within its protective wings and make them society''s such statutory tenants. There thus exists no contractual or statutory privity between the landlord Society and the licensee-petitioner from member of the Society, to ensure protection of his possession after termination of member''s interest in the flat of the Society. Reasoning of the learned trial Judge in this behalf is indeed unanswerable.

Mr. Pratap then contends that definition of the word ''landlord'' u/s 5(3) is wide enough to make the owner Society also the landlord of such licensees without any direct contract with them. Now, the definition, no doubt, is wide enough to include many persons, other than grantors of licence or lease, emphasis having been overtly placed more on the right to recover rent than on mutuality of relationship between the occupant rent payer and the receiver thereof. However, it is never possible to divorce the power of disposal of possessory interest in the flat or premises from the right to recover rent which is but a consideration for user as occupant. In a co partnership co-operative society, while ownership vests in the Society, possessory interest vests in the members, not as tenants but as the direct incident of the share holdings and membership. Right to recover rent, referred to in the definition is thus his own right as the creator of licence or tenancy or of some one else authorised by him to . recover on his account and on his behalf. The Society can never claim right to recover rent from member''s licence or tenant on its own account and that by itself is enough to exclude the Society from the sweep of the definition. It is true that owner is competent to recover rent from the sub-tenant without any privity of contract when he becomes tenant on termination of interest of the head tenant. But that is the effect of section 14(1) of the Act. Such statutory privity is not created between the Society and members licensee in spite of introduction of sub-section (2) of the Act by Act No. 17 of 1973. The Society thus in spite of being owner of the flats of the building and in spite of the width of the definition, cannot Claim to be the landlord of their member''s licensees u/s 5(3) of the Act. Specific inclusion of licensor, i. e. the member, under the amended definition of landlord only goes to fortify this conclusion.

It appears to me that the Legislature has advisedly not made the Society, its member''s licensee''s landlords u/s 5 (?) of the Act. The deliberate exclusion of the Society, from the definition of the ''Landlord'' in spite of conferring on its member''s licensors, the status and the protection of tenants (against their licensor members) under the Rent Act serves duel purpose. The concept of the Housing Cooperative Society has its own implications and the Legislature has given some indication of its recognition by defining their categories under Rule 10 of the Rules framed under the C. S. Act. The respondent Society in this case happens to be the owner of the entire building but possessory rights vest in the members because of the holding of shares. In the very nature of things, people forming such Society are drawn together ordinarily by their needs for accommodation as also by some identity of interests and some common bonds. It is well known that many of such Societies are intended for the benefit of backward classes or employees from whom Government or their employer Corporations or Banks, contemplate extending several financial facilities in addition to allowing lands at cheaper and concessional rates. Such members on getting possession of the flats; constructed with all these facilities can still transfer the possessory interest therein temporarily or permanently out of greed in spite of prohibition specifically and deliberately introduced in the Bye-laws and Tenancy Regulation, thereby conveying interest therein to the undeserving persons for whom the concessional facilities and benefits were never intended. By not so including into the definition of the landlord, the Society is left free to terminate such members'' interest in the flats where transfer happens to be in breach of the Regulation and Bye-laws and defensive of the object with which the scheme was undertaken. Interest of the licensees so defeating the object, also there by gets terminated.

Secondly, conferring the status of statutory tenant on the licensee of the members prevents the members from charging exorbitant rents, and evict at their sweet will and abuse the concession and facilities intended personally for them.'' This protection to them itself would operate as a discouraging force to prevent the members from acquiring the flats in Society merely for making money instead of for their bona fide needs.

Mr. Pratap contends that in view of the judgment of the Supreme Court in the ''case of Ramesh Himmatlal Shah Vs. Harsukh Jadhavji Joshi, , the member''s possessory interest being property, the transfer thereof to even undeserving persons cannot he .prohibited. The contention is misconceived. All that the Supreme Court has held is that such interest of the member in the flat is attachable being transferable, and though such transfer is subject to the prior sanction of the Society, the sanction can never be withheld arbitrarily or whimsically. There is nothing in the judgment of the Supreme Court to support that the Society cannot refuse transfer or terminate-member''s interest therein together with the transfer when breach of Bye-laws defeats the very object of the scheme, [Rest of the judgment is not material for the Report]