Mukesh Seth & Anr. vs A.B.Lal & Sons & Ors.
2010 Latest Caselaw 1971 Del

*           IN THE HIGH COURT OF DELHI AT NEW DELHI


                                                                Date of Reserve: March 04, 2010
                                                                   Date of Order: April 16, 2010
+ CM(M) 459/2008
%                                                                                     16.04.2010
     Mukesh Seth & Anr.                                                       ...Petitioners
     Through: Mr. Mohit Nayar, Advocate

        Versus

        A.B. Lal & Sons & Ors.                                                ...Respondents
        Through: Mr. C.S. Bhandari, Advocate

        JUSTICE SHIV NARAYAN DHINGRA

1.      Whether reporters of local papers may be allowed to see the judgment? Yes.

2.      To be referred to the reporter or not?                                                     Yes.

3.      Whether judgment should be reported in Digest?                                             Yes.


        JUDGMENT

1. By the present petition under Article 227 of the Constitution of India, the

petitioners have assailed an order dated 7th February, 2008 passed by learned ARCT,

Delhi whereby he allowed the appeal of the respondents.

2. Brief facts relevant for the purpose of deciding the present petition are that

the respondents herein filed an eviction petition against M/s Texind Corporation P.

Ltd (as respondent no.1 and against respondents no.2 and 3 before the ARCT), inter

alia on the ground that the premises was let out to respondent no.1, having its

registered office at Bombay for the purpose of maintaining a residence-cum-personal

office of the employee of respondent no.1 but respondent no.3 had parted with

possession of the premises to respondent no.2 M/s Vrishti Overseas P. Ltd. and

respondent no. 3 Shri Mukesh Seth. It was contended that there was fall in business

of respondent no.1 and all its employees gradually left and by the year 2000 its

operation in Delhi stopped. Respondent no.3 earlier working as Branch Manager of

respondent no.1 occupied the premises as branch manager of respondent no.1. After

closure of the business of respondent no.1, he ceased to be employee of respondent

CM(M) 459/2008 Mukesh Seth & Anr. v. A.B. Lal & Sons & Ors. page 1 Of 6 no.1 and he along with his family members formed a company under the name and

style of M/s Vrishti Overseas P. Ltd. (respondent no.2 before the trial court) with its

registered office at the suit premises and this got revealed to the landlord from the

record of Registrar of Companies. Respondent no.1 secretly sublet/ assigned or

otherwise parted with possession of whole or part of the premises in favour of

respondents no.2 and 3 without written consent of the landlord.

3. A common written statement was filed to the eviction petition filed by the

landlord. This was signed by respondent no.3 Shri Mukesh Seth as Authorized

Representative of respondents no.1 and 2 and verified by Shri Mukesh Seth as

authorized representative of respondents no.1 and 2. The written statement was not

accompanied by authority letter or resolution of respondent no.1 or power of

attorney of respondent no.1 in favour of respondent no.3 showing that respondent

no.1 had appointed respondent no.3 as its attorney to contest the case. During trial,

respondent no.3 examined himself as the sole witness. None appeared on behalf of

respondent no.1 to contest the petition. No evidence was led by respondent no.1

about its business or roll of employees or to counter any of the allegations made by

the landlord. It was respondent no.3, the petitioner no.1 herein who contested the

petition. The landlord in h is testimony categorically stated that the business of

respondent no.1 had closed down due to continuous losses and respondent no.3,

earlier working as Branch Manager ceased to be an employee of respondent no.1

and he along with his family members constituted a company in the name and style

of respondent no.2 at the suit premises and the possession of the premises was

parted with in favour of respondents no.2 and 3. Respondent no.3 was the

director/managing director of respondent no.2. This parting with possession by

respondent no.1 was done without consent of the petitioner herein/landlord. It was

also stated that respondent no.3 had constructed his own house in Gurgaon which

he had let out on monthly rental of Rs.70,000/- per month instead of vacating the

suit premises.

CM(M) 459/2008 Mukesh Seth & Anr. v. A.B. Lal & Sons & Ors. page 2 Of 6

4. This testimony of landlord practically remained unrebutted since no record

was produced on behalf of respondent no.1 before the learned ARC to show that its

business in Delhi was continuing or respondent no.3 continued to be in its

employment.

5. The respondent boldly denied the allegations made by the landlord. Shri

Mukesh Jain (respondent no.3) filed his affidavit in evidence wherein he stated that

he was still holding residential premises as branch manager of respondent no.1and

the premises was under legal control of respondent no.1 giving an impression as if

he was still an employee of respondent no.1. It was admitted that respondent no.2

company was got registered at the address of the suit premises, however, it was

submitted that later on its business activities were shifted to 226-27, Udyog Vihar,

Gurgaon. During cross examination this witness admitted that when he joined as an

employee of respondent no.1, he used to receive salary. He admitted that he stopped

receiving salary from 2001. He stated that thereafter he was working on commission

basis and used to get commission as and when some machinery of respondent no.1

was installed through him. In his cross examination, he repeatedly stated that he

could produce the records of his employment, business of respondent no.1 and

shifting of respondent no.2 from the suit premises to Udyog Vihar and in respect of

the fact that respondent no.1 was still carrying on its business from the suit

premises but he did not produce the record at any point of time. It was admitted by

him that he was not being paid salary. It was also admitted by him that he had been

carrying on business in the name of style of respondent no.2 of which he was the

director. He admitted that respondent no.1 had director Mr. A.N. Munsha and Ms.

Heena Munsha and these directors used to live in Mumbai.

6. The learned ARC observed that it was for the landlord to prove by cogent

evidence that respondent no.3 has ceased to be an employee of respondent no.1.

The landlord should have summoned the record of respondent no.1 to prove this fact

and the landlord should have examined the record from Registrar of Companies to

CM(M) 459/2008 Mukesh Seth & Anr. v. A.B. Lal & Sons & Ors. page 3 Of 6 show that respondent no.1 had been wound up or has become non-operational due

to losses suffered by it. Since the landlord failed to lead this evidence, the landlord

had not discharged his burden of proving that respondent no.3 who was no more an

employee of respondent no.1 and he therefore dismissed the eviction petition.

Against this order on appeal learned ARCT observed that the learned ARC totally

went wrong in shifting the burden of proving that respondent no.3 was an employee

of respondent no.1, on the landlord. He came to conclusion that the approach of

learned ARC was illegal and appreciation of evidence by him was totally erroneous.

He came to conclusion that once the landlord had given evidence that respondent

no.3 was doing his own business from the suit premises by constituting a company

in the name the burden shirts to respondent /tenant to prove that respondent no.3

was till an employee of respondent no.3 and the burden could not have been put on

the landlord. He also observed that parting with possession of the suit premises was

clear from the testimony of respondent no.3 and it was for respondent no.3 to show

that he continued to be in possession of the suit premises as an employee of

respondent no.1 and not as a businessman running an independent company of his

own from the suit premises. The learned ARCT observed that the judgment rendered

by learned ARC was illegal on the face of it because of wrong interpretation of law

and erroneously placing the onus of proving on the landlord and therefore he

reversed the order of learned ARC.

7. I agree with the conclusion arrived at by learned ARCT. In an eviction

petition filed against the tenant on the ground of parting with possession /subletting

where tenant does not even contest the eviction petition and only the sub tenant

contests the eviction petition, this fact alone should have been sufficient for learned

ARC to hold that the suit premises had already been parted with possession and it

was not the tenant who was interested in the litigation but it was the sub tenant

/person in occupation, who was interested in protecting the possession. The learned

ARC did not bother even to look into the fact that there was no authorization or

resolution placed on record from the tenant/ respondent no.1 in favour of

CM(M) 459/2008 Mukesh Seth & Anr. v. A.B. Lal & Sons & Ors. page 4 Of 6 respondent no.3 to sign the written statement on behalf of respondent no.1 and to

contest the case on behalf of respondent no.1. The learned ARC also ignored the

material evidence that has come on record by way of deposition of respondent no.3

that he was no more receiving salary from respondent no.1. His statement that he

was receiving commission in respect of machinery installed by him was not proved

by documents. It was for him to prove that he had installed some machinery on

respondent no.1 and received some commission through cogent documentary

evidence that would have reflected that some business of respondent no.1 was going

on and he had some connection with respondent no.1.

8. The learned ARC also totally ignored Section 106 of Indian Evidence Act

which provides that a fact in the special knowledge of a person has to be proved by

that person. Whether respondent no.1 was continuing with its operation in Delhi was

within the special knowledge of respondent no.1 and it was for respondent no.1 to

prove by cogent evidence in the Court that its business was continuing in Delhi and

respondent no.3 was its employee. No document worth name showing any

connection whatsoever between respondent no.1 and respondent no3 was proved on

record by either of the respondents. This burden could not have been shifted upon

the landlord because the landlord was not in special knowledge of this fact. The

landlord had only learnt this fact either by record of Registrar of Companies or

through conduct of respondent no.3. The landlord proved it by producing record

from the Registrar of Companies. It was not the case of the landlord that respondent

no.1 has been wound up. The case of the respondent no.1 was that respondent no.3

has ceased to be an employee of respondent no.1 and the possession has been

parted with by the respondent no.1 to respondent no.3. The learned ARC wrongly

observed that the landlord was supposed to prove from record of Registrar of

Companies that respondent no.1 had been wound up or its business had suffered

losses. I, therefore, consider that the order of learned ARC was totally illegal and the

learned ARCT rightly set aside the same. Parting with possession of the suit

premises is writ large in the case as respondent no.3 had started his own business in

CM(M) 459/2008 Mukesh Seth & Anr. v. A.B. Lal & Sons & Ors. page 5 Of 6 the premises let out to respondent no.1 for having residence-cum-personal office of

its employee.

9. I, therefore, find no force in this petition. The petition is hereby dismissed

with no orders to costs.

April 16, 2010                                                  SHIV NARAYAN DHINGRA J.
rd




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