Curewell (India) Ltd. vs Inderjit Singh And Ors.
1995 Latest Caselaw 108 Del

JUDGMENT

Anil Dev Singh, J.

(1) This is a second appeal against the judgment and order of the Rent Control Tribunal, dated October 28,1989 thereby the appellant-tenant's appeal against the judgment and order of the Rent Controller, Delhi dated January 8,1986 was dismissed. The facts leading to this appeal are as under:

(2) Property No.72, Ring Road, Lajpat Nagar Iii, New Delhi was owned by late Sahib Singh, predecessor in interest of respondent. On November 21, 1969, he let out the same to the appellant at a monthly rental of Rs.2300.00 . On March 23,1983 respondents filed an eviction petition under Section 14(1)(b) of the Delhi Rent Control Act,1958 against the appellant on the ground of subletting of the premises by the latter without specific permission of the landlord in writing. It was alleged in the petition filed before the Rent Controller, that the appellant had sublet, assigned or parted with possession of the demised premises to S.K.Ajwani/ D.Kumar Consulting Engineers (P) Ltd. without specific permission in writing of the landlord. It was further alleged that the premises were occupied by S.K.Ajwani/D.Kumar Consulting Engineers (P) Ltd.illegally and unauthorisedly; that the premises were let out to the appellant by means of an agreement in writing; that none was residing in the demised premises and that the ground floor was lying vacant while the first floor was under the unauthorised occupation of Shri S.K. Ajwani/D. Kumar Consulting Engineers (P) Ltd. In response the appellant by its written statement filed on November 1, 1983 stated inter alia, that the landlord had agreed to the tenancy of the appellant; that the lease deed provided that the premises shall be used jointly by the appellant as well as M/s.D.Kumar Consulting Engineers,. Pvt.Ltd; that the appellant was also authorised to sublet the premises to any of its sister concerns or associates; that the appellant was in possession of the demised premises with M/s.D.Kumar Consulting Engineers (P) Ltd. and both were in legal and authorised possession; that the building was being previously used for commercial purposes and this was objected to by the landlord, whereupon the appellant stopped using the premises for commercial purpose and therefore the premises were being used for residential purposes by the appellant as well as by M/s. D.Kumar Consulting Engineers (P) Ltd. It was denied that late Shri Sahib Singh never gave any consent to the appellant to induct Shri S.K.Ajwani/D.Kumar Consulting Engineers (P) Ltd. It was also denied that the ground floor' of the demised premises was lying vacant and the first floor was under unauthorised occupation of S.K.Ajwani/D.Kumar Consulting Engineers (P)Ltd.

(3) The parties went to trial on the basis of the aforesaid pleadings and led evidence in support of their respective stands. The Rent-Controller by its-judgment dated January 8,1986 passed an eviction order against the appellant holding that the appellant had sublet the premises to Shri S.K.Ajwani/D.Kumar Consulting Engineers (P)Ltd without specific permission in writing of the landlord. While holding so, the Rent Controller on consideration of the evidence on record came to the conclusion that M/s.D.Kumar Consulting Engineers (P)Ltd., which was admittedly in occupation of the demised premises, was a different entity from M/s.D.Kumar Consulting Engineers sole proprietary firm of D.Kumar, who was permitted to use the property jointly with the appellant tenant as per clause 9. In this regard he also relied on the statement of Shri Varinder Kumar,Secretary of the appellant company (RW 1) who stated that at the time of creation of tenancy in question, D.Kumar was the proprietor of M/s.D.Kumar Consulting Engineers. In addition he relied on the following circumstances to hold that the appellant had sublet the premises in violation of the provisions of Section 14(1)(b) of the Delhi Rent Control Act,1958.

1.Ex./RX, lease deed does not mention that M/s.D.Kumar Consulting Engineers was a Private Limited Co. 2. The respondents had proved on record certified copy of the judgment of Rent Control Tribunal, in a previous litigation between the parties, according to which M/s.D.Kumar,Consulting Engineers was the sole proprietary concern of Shri D.Kumar. 3. The sole proprietary concern of M/s.D.Kumar Consulting Engineers came to an end with the death of Shri D.Kumar. 4. It was not the case of the appellant that after the death of Shri D.Kumar,legal representatives were in occupation of the demised premises. 5. According to the statement of Rw 1 K.L.Rajgaria was the Chairman of D.Kumar Consulting Engineers Pvt.Ltd. and Mr.Ashok Kumar Rajgaria was the Joint Managing Director thereof. Management of D.Kumar Consulting Engineers Pvt.Ltd. was.different from the earlier management of the company. 6. No document was proved on record by the appellant to show that D.Kumar Consulting Engineers (P)Ltd. started working in the premises at the time of inception of the tenancy. 7. There was no evidence on record to show that M/s.D.Kumar Consulting Engineers Pvt.Ltd. was the sister concern of the appellant or there was any connection between the two. 8. In cross-examination Rw 1 admitted that the appellant was receiving consideration for use and occupation from M/s.D.Kumar Consulting Engineers (P)Ltd.

(4) In these circumstances the Rent Controller came to the conclusion that the appellant had sublet the demised premises. On appeal,the Rent Control Tribunal by its order dated November 28,1989 while upholding the finding of the Rent Controller, as to the subletting of the premises by the appellant to M/s. D.Kumar Consulting Engineers Pvt.Ltd., observed as follows: 1.Clause 9 of the lease deed stipulated that the demised premises shall be jointly used by the appellant-as well as by M/s. D.Kumar Consulting Engineers. 2. No specific permission was given by the landlord to the appellant to sublet the premises to D.Kumar Consulting Engineers Pvt.Ltd. and permission under clause 9 to sublet was confined only to the proprietary concern of Sh.D.Kumar viz. D.Kumar Consulting Engineers. 3. The sole proprietary concern was not a legal person and the company, namely M/s.D.Kumar Consulting Engineers Pvt.Ltd. was having a distinct and separate entity of its own. 4. Under clause 9 of the lease deed there was a general permission to sublet the premises to any of the sister concern/associates of the appellant. 5. Permission to sublet in general terms did not satisfy the requirements of Section 14(1)(b) of the Delhi' Rent Control Act. 6. The appellant did not deny in its written statement that a part of the premises had been sublet to D.Kumar Consulting Engineers Pvt.Ltd. Shri Varinder Kumar, Rw 1 admitted in his cross-examination that first floor of the demised premises was separately earmarked for M/s. D.Kumar Consulting Engineers Pvt.Ltd.and the appellant has been receiving consideration from the former for its use and occupation of the same. 7. The management of M/s. D.Kumar Pvt.Ltd. was different from that of the appellant and none of the directors of the appellant were on the board of D.Kumar Consulting Engineers Pvt.Ltd.

(5) Having regard 'to above, the Tribunal was of the view that the appellant had sublet the premises to M/s.D.Kumar Consulting Engineers Pvt.Ltd. At this stage it will be appropriate to refer to the fact that on February 7,1986, during the pendency of the appeal before the Rent Control Tribunal, the appellant moved an application under Order 6 rule 17 Cpc for the purpose of clarifying the pleadings contained in the written statement. It also filed an. application under Order 41 rule 27 Civil Procedure Code seeking permission to produce fresh material to show that the appellant and D.Kumar Consulting Engineers Pvt.Ltd. were sister concerns and under clause 9 of the lease deed dated November 20,1969 the appellant was entitled to sublet the premises to M/s.D.Kumar Consulting Engineers Pvt.Ltd. The Tribunal,however, was of the opinion that it will be futile to allow the appellant to amend the written statement and lead evidence to prove that D.Kumar Consulting Engineers Pvt.Ltd. was the sister concern or an associate of the appellant as even if the appellant succeeds in proving the same it cannot seek protection under Section 14(1)(b) of the Delhi Rent Control Act as under clause 9 of the lease deed permission to sublet the premises in question was of a general nature. This being the position the Tribunal was of the view that general permission to sublet was not inconformity with Section 14(1)(b) of the Delhi Rent Control Act,1958.

(6) MR.BHAT, learned Senior counsel for the appellant assailing the findings of the Rent Controller and the Tribunal 'urged that the landlord permitted the appellant and D.Kumar Consulting Engineers to jointly occupy the. premises as the latter was a sister concern of the former. He contended that on June 10,1971 D.Kumar Consulting Engineers was converted into M/s.D.Kumar Consulting Engineers Pvt.Ltd. and D.Kumar kept the control of the company. The argument is that the sole proprietary concern of D.Kumar was converted into a company and the appellant did not have any say in the matter and therefore there was no subletting the premises by the appellant to M/s. D.Kumar Consulting Engineers Pvt.Ltd. This argument though attractive, is devoid of force. Both the Rent Controller and the Rent Control Tribunal on consideration of the evidence on record came to the conclusion that the premises were sublet by the appellant to M/s. D.Kumar Consulting Engineers Pvt.Ltd. This being a finding of fact, I am afraid, cannot be interfered with in second appeal. Both the authorities specifically referred to the statement of Rw 1 Varinder Kumar, Secretary of the appellant company, who admitted in the cross examination that the first floor of the premises was separately earmarked for M/s.D.Kumar Consulting Engineers Pvt.Ltd. and the appellant had been receiving consideration from the former for the occupation of the same. He also stated that the constitution of M/s.D.Kumar Consulting Engineers Pvt.Ltd. had undergone change and Shri K.L.Rajgaria and Mr.Ashok Kumar Rajgaria were the Chairman and the Joint Managing Director of the company respectively and M/s.D.Kumar Consulting Engineers Pvt.Ltd. had nothing to do with M/s.D.Kumar Consulting Engineers. At this stage it will be relevant to notice clause 9 of the lease deed which reads as follows: "9.The said premises shall be used jointly by M/s.Curewell India Ltd. and M/s.D.Kumar Consulting Engineers and the lessee of the Second Part shall have the right to assign its full rights under this lease to M/s.D.Kumar Consulting Engineers if so desired. The lessee of the second part will not be competent to sublet to any one the demised premises or assign or otherwise part with their possession in whole or any part thereof but he is authorised to sublet to any of their sister concerns or Associates".

(7) As is clear from the reading of the aforesaid clause the appellant could enjoy the tenancy jointly with D.Kumar Consulting Engineers. But it has been correctly noted by the Tribunal that the first floor of the premises had been separately and exclusively earmarked for M/s.D.Kumar Consulting Engineers Pvt.Ltd. and the appellant had been receiving consideration from the former for its occupation. Besides M/s.D.Kumar Consulting Engineers Pvt.Ltd. which is in occupation of the premises, is a different entity from D.Kumar Consulting Engineers,sole proprietary concern, which was permitted to jointly share the premises with the appellant. In the circumstances therefore M/s.D.Kurnar Consulting Engineers Pvt.Ltd. can not be considered to be an alter ego or corporate reflection of the firm M/s.D.Kumar Consulting Engineers. It was also noticed by the courts below that there was no consent in writing of the landlord for subletting of the premises to M/s.D.Kumar Consulting Engineers Pvt.Ltd. In M/s.Shalimar Tar Products Ltd. Vs. H.C.Sharma, , it was held that under Section 14(1)(b) of the Delhi Rent Control Act, 1958 the consent of the landlord for permitting subletting must be specific and in writing. This requirement was mandatory and could not be waived. Learned counsel for the respondent rightly contended that the permission of the landlord under clause 9 of the lease deed was only for purposes of sharing the premises by the appellant with M/s.D.Kumar Consulting Engineers and this permission was not for subletting the premises to another entity or giving exclusive possession of the same or any part thereof to it. Since the subletting was effected by the lessee without the consent of the landlord, this action must result in breach of Section 14(1)(b) of the Delhi Rent Control Act, 1958 and the stipulation contained in clause 9 of the lease deed. The appellant was not entitled to take consideration from D.Kumar Consulting Engineers Pvt.Ltd. for the use and occupation of the premises as the permission was only to share the premises and that too with D.Kumar Consulting Engineers. There was no permission to create a sub-tenancy of D.Kumar Consulting Engineers Pvt.Ltd. and handing over part of premises exclusively to it.

(8) Learned counsel for the appellant contended that even if it be assumed that the premises were sublet to M/s. D.Kumar Consulting Engineers Pvt.Ltd.it would not constitute breach of the covenant or of Section 14(1)(b) of the Delhi Rent Control Act,1958 as M/s.D.Kumar Consulting Engineers Pvt.Ltd. was a sister concern of the appellant. The argument proceeds on the footing that clause 9 permits the appellant to sublet the premises to its sister concern. It must be noticed that in the first place both the authorities have held that M/s.D.Kumar Consulting Engineers Pvt.Ltd. is not the sister concern of the appellant and secondly permission to sublet to a sister concern of the appellant is of a general nature which does not meet the requirements of Section 14(1)(b). The argument of the learned counsel for the appellant flies in the face of the decision of the Supreme Court in M/s.Shalimar Tar Products Ltd. (Supra). While interpreting Section 14(1)(b) of the Delhi Rent Control Act,1958 the Supreme Court clearly held that general permission for subletting would be of no avail in view of Section 14(1)(b) of the Delhi Rent Control Act and permission to sublet must be specific and should be in writing.In Bajaj Auto Limited Vs. Behari Lal Kohli 39 (1989) Delhi Law Times 55, the Supreme Court reiterated the view which was taken in M/s.Shalimar Tar Products Ltd. (Supra).

(9) Again in Shantilal Rampuria and others Vs. M/s.Vega Trading Corporation and others, the Supreme Court while interpreting Sections 13 and 14 of the West Bengal Premises Tenancy Act,1956 held that general permission granted in the lease deed to sublet the premises is not sufficient in law and for each subletting there should be specific and separate permission of the landlord to the tenant to sublet. In this regard it was observed as follows: ".....IT is plain from the above that the Act contemplates that while one sub- tenant may be evicted another may continue in the premises as a tenant directly under him, depending on the circumstances. We are, therefore, of the view that previous consent in writing of the landlord with respect to each sub- letting separately is essential and a general authority to the tenant in this regard will not be sufficient in law. Our view is supported by the observations in M/s.Shalimar Tar Products Ltd. Vs.H.C.Sharma a case arising under the Delhi Rent Control Act. An examination of Sections 14(1)(b), 16, 17 and 18 of the Delhi Rent Control Act would show that the two Acts (West Bengal Act and the Delhi Act) are similar so far the present question is concerned. In the present case,since it is not suggested on behalf of the respondent that consent of the appellants was obtained specifically for each of the sub-tenancies, the respondent-corporation must be held to have violated Section 14. The appellants have thus, established the ground mentioned in Section 13(1)(a) and are entitled to succeed."

(10) Learned counsel for the respondents submitted that reliance of the appellant on clause 9 of the lease deed is misconceived as the lease deed is not a registered document and since the document was inadmissible in evidence, all its terms would also be inadmissible including clause 9 thereof. It is not necessary to go into this argument for the view which I have taken and also for the reason that no such point was urged before the courts below.

(11) Having regard to the aforesaid discussion, the second appeal is dismissed there being no merit in the same. However, in the facts and circumstances of the case there will be no order as to cost.

(12) At request of the learned counsel for the appellant the operation of this judgment will remain stayed for six weeks.