Laxmi Devi Jhawar vs Usha Telehoist Ltd.
1992 Latest Caselaw 406 Del

JUDGMENT

C.L. Chaudhry, J.

(1) The Plaintiff has filed this suit for ejectment of the defendants and for mesne profits. The plaintiff claims to be the owner/landlady of the premises bearing No. C-20, Friends Colony, New Delhi. It is alleged that the defendant is a company duly incorporated under the Indian Companies Act and has its registered office at Calcutta. The defendant company has its local office at Delhi. The defendant company approached the plaintiff in the year 1976 for letting out the premises. A lease was created by the plaintiff in favor of the defendant in respect of the entire premises on a monthly rent of Rs. 5,000.00 . The terms and conditions were confirmed by the parties by letter dated 26.2.1976. The rent of the premises was increased to Rs. 7,500.00 in 1981 and to Rs.l2,000.00 per month in 1987 and again to Rs.25,000.00 per month w.e.f. 1.4.1989.

(2) The defendant company was using the premises for the residence of their officers from the beginning of the tenancy. In July 1990 the plaintiff came to know that the defendant company in order to oblige some of its officials/agents and in connivance with their officers, have sublet a part of the premises to one Shri B.M.Khanna, who was ex-employee of the company, without the consent of the plaintiff owner/landlady. The plaintiff requested the defendants to vacate the premises as she was in bonafide need of the premises for her own residence and did not want to renew the lease any further. The plaintiff has no other residential property in Delhi for her residence. By a registered notice dated 7.8.1990 the plain tiff terminated the lease of the defendant and the defendant was required to deliver peaceful possession of the premises on or before 31.8.1990. The defendant failed to comply with the terms of the notice and therefore the necessity for filing the present suit.

(3) During the pendency of the suit an application under Order I Rule 10 and Section 151 Civil Procedure Code has been filed on behalf of M/s. Machinery Sales and Service Corporation, New Delhi for being imp leaded as a party to the present suit. This is the I.A. (Being I.A.No. 1336/1991) which is underdisposal. It is alleged in the application that the plaintiff has filed the suit against the defendant for eviction and for mesne profits. It is stated that the entire position taken by the plaintiff is not only false but dishonest. M/s. B.M.Khanna Associates Pvt. Ltd. was let out the entire ground floor of the premises bearing No.C-20, Friends Colony, New Delhi in the year 1982 at a monthly rental of Rs. 2,000.00 . The entire ground floor is comprised of the built portion, the front lawn, the backyard, the drive way and the side wall of the entire building and servant quarter with common facilities on the top floor. The said company was inducted as a tenant by the defendant herein and as such creation of the tenancy was confirmed by the defendant and the defendant wrote a communication dated 26.7.1982 to M/s. B.M.Khanna Associates Pvt. Ltd. confirming the tenancy. Ever since that date M/s. B.M. Khanna Associates Pvt. Ltd. continued in un-interrupted and exclusive possession of the entire ground floor of the premises in question till July 31, 1987 when by means of a tripartite arrangement a portion of the ground floor was allowed by the applicant herein to be let out by the defendant herein to M/s. Machinery Sales & Service Corporation. This letting out of a portion of the ground floor to M/s. Machinery Sales & Service Corporation was confirmed by the defendant vide communication dated July 27, 1987. The female of the premises that remained to be occupied by M/s. B.M.Khanna Associates Pvt. Ltd. remained at Rs.2,000.00 per month while M/s. Machinery Sales and Service Corporation, the applicant, started paying rent in respect of the portion taken by the applicant on rent from the defendant @ Rs. 2,000.00 per month. Thus the rent for the entire ground floor remained to be Rs. 4,000.00 per month. The plaintiff herein is the wife of the Chairman of the defendant company. In fact the family of Shri M.K. Jhawar is thee controlling factor so far as the defendant company is concerned. The defendant company, as well as the present plaintiff all along knew about the creation of the tenancy, firstly in favor of M/s. B.M. Khanna Associates Pvt. Ltd. and then as already stated, in favor of the applicant. In fact both the Chairman of the defendant company, as well as the plaintiff have been on visiting terms with Shn B.M. Khanna, a Director of M/s. B.M. Khanna Associates Pvt. Ltd. In any' case there is documentary proof of the applicant being a regular tenant in the premises in question. So far as the so called unauthorised sub-letting is concerned, the same is totally false and baseless. The applicant is in posses-applicant herein to be let out by the defendant herein to M/s. Machinery Sales & Service corporation. This letting out of a portion of the ground floor to M/s. Machinery Sales and Service Corporation was confirmed by the defendant vide communication dated July 27, 1987. The rental of the promises that remained to be occupied by M/s B.M. Khanna Associates Pvt. Ltd. remained at Rs. 2,000.00 per month while M/s. Machinery Sales and Service Corporation, the applicant, started paying rent in respect of the portion taken by the applicant on rent from the defendant @ Rs. 2,000.00 per month. Thus the rent for the entire ground floor remained to be Rs. 4,000.00 per month. The plaintiff herein is the wife of the Chairman of the defendant company. In fact the family of Shri M.K. Jhawar is the controlling factor so far as the defendant company is concerned. The defendant company, as well as the present plaintiff all along knew about the creation of the tenancy, firstly in favor of M/s. B.M. Khanna Associates Pvt. Ltd. and then as already stated, in favor of the applicant. In fact both the Chairman of the defendant company, as well as the plaintiff have been on visiting terms with Shri B.M. Khanna, a Director of M/s. B.M. Khanna Associates Pvt. Ltd. In any case there is documentary proof of the applicant being a regular tenant in the premises in question. So far as the so called unauthorised sub-letting is concerned, the same is totally false and baseless. The applicant is in possession of the premises within the knowledge of the plaintiff and the plaintiff cannot be heard to state otherwise. The present suit has been filed clandestinely by the plaintiff with the sole object of obtaining a collusive decree against the defendant and in exercise of that decree, throw out the applicant from the suit premises. The applicant is entitled to protect its tenancy. The tenancy of the premises has absolutely nothing to do with the business of agency being run by the applicant. In any case the applicant is entitled to protect its tenancy and is not only a proper but also a necessary party to the present suit. In these premises it is stated that the applicant be imp leaded as a party to these proceedings.

(4) M/S. B.M. Khanna Associates Pvt. Ltd. has also filed an application under Order I Rule 10 and Section 151 Civil Procedure Code (being I.A. No. 1337/1991) for being imp leaded as a party to the suit. The case disclosed by M/s. B.M.Khanna Associates Pvt. Ltd. is that the entire position taken by the plaintiff is not only false but dishonest. M/s. B.M. Khanna Associates Pvt. Ltd. was let out the entire ground floor of the premises in the year 1982 at a monthly rental of Rs. 2,000.00 . The company was inducted as tenant by the defendant on 26.7.1982. Ever since that day M/s. B.M. Khanna Associates Pvt. Ltd. continued in un-interrupted and exclusive possession of the entire ground floor of the premises in question till July 31. 1987 when by means of a tripartite 147 arrangement, a portion of the ground floor was allowed by the applicant herein to be let out by the defendant herein to M/s. Machinery Sales and Service Corporation. This letting out of a portion of the ground floor to M/s. Machinery Sales & Service Corporation was confirmed by the defendant by a communication dated 27.7.1987. The rental of the premises remained at Rs. 2,000.00 per month. The rent for the entire ground floor remained to be at Rs. 4,000.00 per month. In the year 1990 the defendant started harassing the applicant and started pestering the applicant to vacate the premises. All attempts on the part of the defendant to throw out the applicant from the premises forcibly and without any due process of law were thwarted by the applicant, through peaceful manner. Ultimately the applicant had to file a suit for injuction. In that suit the defendant herein has been restrained inter alia from disturbing the peaceful possession of the applicant in respect of the portion of the premises in its occupation. The plaintiff is the wife of the Chairman of the defendant Company and in fact the family of Shri M.K. Jhawar owns a large number of shares of defendant company and in fact Shri M.L. Jhawar is the controlling factor so far as the defendant company is concerned; Similar allegations are also made as are made by M/s. Machinery Sales and Service Corporation. Under these premises it is prayed that the application may also be imp leaded as a party in these proceedings.

(5) The applications are being contested on behalf of the plaintiff. Though no reply to these applications has been filed on behalf of the plaintiff.

(6) I have heard the learned counsel for the parties. Mr. Kataria contended that the applicants are required to be imp leaded as parties because they are lawful sub- tenants and they would show that this is a collusive suit in order to evict the applicants. The applicants have a right to remain in the premises till such time they are evicted by due process of law. M/s. B.M. Khanna and Associates, the applicants are in possession of the premises as lawful sub-tenants for the last about 10 years, and M/s. Machinery Sales and Service Corporation are sub-tenant for the last about 5 years. The sub-tenancy was created with the knowledge of the plaintiff. The plaintiff is the wife of the Chairman of the defendant company. In support of his contention Mr. Kataria as relied upon a judgment of this court delivered in the case of Pnb Finance Ltd. Vs. Shital Prasad Jain , wherein it was observed that:- "the doctrine of piercing the corporate veil is not confined to cases of tax assessment etc. only and the Court may invoke this doctrine, wherever it is necessary to implead some other party also. The application serves this purpose and if the Court finds that the application makes out a case for impleading a third party, the court can proceed to do so. Otherwise, the reference in Rule 10 (2) to applications by other parties to the suit and suo motu action of the Court would be rendered nugatory. The court has to consider whether the presence of the proposed party is necessary in order to enable the court to effectively and completely adjudicate upon and settle all the questions included in the suit. The Courts, therefore, in exercising their discretion under Order 1 Rule 10 can implead parties who have a direct and immediate interest in the dispute in controversy in the suit."

(7) In this case, it was an ejectment suit filed by the landlord against a tenant. 148 A third person applied for getting himself imp leaded as a party on the ground that he was a real tenant in possession. The evidence and circumstances in the case, prima facie established that his claim was bonafide and plausible. In those circumstances the court held that he was entitled to be imp leaded as a defendant so as to prevent multiplicity of proceedings and the question could be completely and effectively decided in the presence of all the parties. The ratio of this judgment is also not applicable to the facts and circumstances of this case because the applicants are not claiming that they are the direct tenants of the plaintiff. The case pleaded by them is that they are lawful sub-tenants.

(8) On the other hand the contention of Mr. Jain is that the applicants are not necessary or proper parties to these proceedings. They are mere sub-tenants and they cannot be allowed to be heard in this suit. This is not an eviction petition under Delhi Rent Control Act on the ground of unlawful sub-letting wherein the sub-tenant could be allowed to be heard in respect of the claim of the landlord regarding sub- tenancy. Certain rights flow from the Act to the sub-tenants under the Delhi Rent Control Act. In this case the plaintiff is required only to prove the tenancy or the lease was validly determined and the defendant lessee has no other defense to raise except validity and legality of the termination of the lease. In support of his contention Mr. Jain relied upon the Judgment of the Supreme Court in the case of Ramchand Gupta Vs. Raghuvanshi (Pvt.) Ltd. and another: , wherein it was observed as under:- "Where the land lord institutes a suit against the lessee for possession of the land on the basis of a valid notice to quit served on the lessee and does not implead the sub-lessee as a party to the suit, the object of the landlord is to eject the sub-lessee from the land in execution of the decree and such an object is quite legitimate. The decree in such a suit would bind the sub-lessee. This may act harshly on the sub-lessee, but this is a position well understood by him when he took the sub-lease The law allows this and so the omission cannot the said to be an improper act.' The mere fact that the defendant agrees with the plaintiff that if a suit is brought he would not defend it, would not necessarily prove collusion. It is only if this agreement is done improperly in the sense that a dishonest purpose is intended to be achieved that they can be said to have colluded."

(9) I have given my thoughtful consideration to the entire matter. In my opinion the contention of Mr. Kataria is not well founded. The applicants are merely subtenants. It was the option of the plaintiff to implead them as a party to the suit or not. In a suit for ejectment the plaintiff is required to prove that the lease was validly determined. Sub-tenants cannot raise any defense in the suit. This is not the case of the applicants that they are the direct tenants of the plaintiffs and they may be allowed to prove it. In view of the law laid down in Rupchand Gupta's case (supra) I am of the considered view that no case is made out by the applicants for being imp leaded as parties to the suit.

(10) In the result I see no merit in these applications and the same are dismissed.