Sharad Indu Bhatnagar vs Jitender Malik
2011 Latest Caselaw 6124 Del

*            IN THE HIGH COURT OF DELHI AT NEW DELHI

+            RFA Nos.381/2003, 383/2003, 416/2003 & 417/2003

%                                                    14th December, 2011

1.    RFA No.381/2003

SHARAD INDU BHATNAGAR                        ..... Appellant
                 Through:              Mr. Vinay Kumar Garg, Advocate
                                       with Mr. Fazal Ahmad, Advocate.

                   versus

JITENDER MALIK                                 ..... Respondent

Through: None.

2.    RFA No.383/2003

SHARAD INDU BHATNAGAR                        ..... Appellant
                 Through:              Mr. Vinay Kumar Garg, Advocate
                                       with Mr. Fazal Ahmad, Advocate.


                   versus

SH. VIJAY LOCHAV                               ..... Respondent
                            Through:   None.

3.    RFA No.416/2003

SHARAD INDU BHATNAGAR                        ..... Appellant
                 Through:              Mr. Vinay Kumar Garg, Advocate
                                       with Mr. Fazal Ahmad, Advocate.


                   versus


 SMT. INDU LOCHAV                               ..... Respondent
                            Through:   None.

4.    RFA No.417/2003

SHARAD INDU BHATNAGAR                        ..... Appellant
                 Through:              Mr. Vinay Kumar Garg, Advocate
                                       with Mr. Fazal Ahmad, Advocate.

                   versus

HAR KAUR                               ..... Respondent
                            Through:   None.

CORAM:
HON'BLE MR. JUSTICE VALMIKI J.MEHTA

 To be referred to the Reporter or not?


VALMIKI J. MEHTA, J (ORAL)

1. By this judgment, four appeals are being disposed of as they

involve identical facts and issues, and have been disposed of by identical

impugned judgments. For the sake of convenience, reference is being made

to the facts in RFA No.381/2003.

2. The facts of the case are that the appellant/plaintiff filed the

subject suit for recovery of ` 3,12,321/- against the respondent/defendant.

The suit is for recovery of the amount which was given to the

respondent/landlord as security deposit at the time of entering into the

tenancy. The recovery is claimed inasmuch as tenancy had come to an end

and since there were no dues of the appellant/plaintiff towards the

respondent/defendant/landlord the security deposit was to be paid back by

the respondent/defendant.

3. The subject suit has been dismissed by holding that the plaintiff

has no locus standi to seek recovery of deposit inasmuch as the plaintiff was

not the tenant in his individual capacity in the premises, and, the tenant was

M/s. Hollywood Grills, a unit of Wendy Restaurant Pvt. Ltd. The trial Court

has therefore held that the amount of security deposit can only be claimed

back by the tenant which is a company and not by the plaintiff who was the

Director in the said company.

4. The relevant issue which was framed in this regard by the trial

Court was issue No.1.

5. Learned counsel for appellant argued that the findings of the

trial Court, in this regard, are illegal and are bound to be set aside for the

following reasons:-

(i) The lease agreement has been signed by the plaintiff, and in the

cross-examination of the respondent/defendant, it was admitted that the lease

agreement was executed by the appellant/plaintiff with the

respondent/defendant.

(ii) It is argued that the company-M/s. Wendy Restaurant Pvt. Ltd.

was not in existence on the date when the lease agreement, Ex. P/1 dated

1.7.1995 was entered into and thus only the plaintiff can get back the

security deposit which was paid by him.

(iii) The contents of the plaint making averment of the plaintiff

being the tenant were not denied in the written statement and therefore the

plaintiff was the tenant and not the company-M/s. Wendy Restaurant Pvt.

Ltd.

(iv) Finally, it is argued that a legal notice dated 19.5.1999,

Ex.PW1/59 was served upon the respondent, as proved by the postal receipt

attached with the same, and which notice was issued on behalf of the

appellant/plaintiff personally.

6. The issue, in this case, therefore is that whether the

appellant/plaintiff was the tenant in the premises or was the tenant in the

premises a company, M/s. Wendy Restaurant Pvt. Ltd.

7. The relevant portion of the lease deed in question by which the

tenancy was brought into existence states the parties to the same, and the

parties are the respondent/defendant as the first party and M/s. Hollywood

Grill (a unit of M/s. Wendy Restaurant Pvt. Ltd.) as a second party. Clearly

therefore as per the lease agreement, the tenant is not the appellant/plaintiff

but M/s. Hollywood Grill (a unit of M/s. Wendy Restaurant Pvt. Ltd.). Even

where the signatures have been put by the appellant/plaintiff on the second

page of the lease agreement it is signed for M/s. Hollywood Grills (a unit of

M/s. Wendy Restaurant Pvt. Ltd.). So far as the lease agreement is

concerned therefore there can be no manner of doubt that the lessee was

M/s. Hollywood Grill (a unit of M/s. Wendy Restaurant Pvt. Ltd.), a

company. The respondent in the cross-examination admits that the lease

was executed by the plaintiff, and which is correct, but the execution i.e. the

signatures of the plaintiff are only on behalf of M/s. Hollywood Grill, a unit

of M/s. Wendy Restaurant Pvt. Ltd.-a company.

8. A reading of the plaint also shows that there is no categorical

averment that it is the appellant/plaintiff who was the lessee of the premises.

There are general averments in the plaint of the appellant/plaintiff having

come to India and wanting a commercial space for opening of a restaurant,

however, there is no specific averment in the plaint that the

appellant/plaintiff was a tenant/lessee in his individual capacity and the

tenancy was not of the company-M/s. Wendy Restaurant Pvt. Ltd. through

its unit M/s. Hollywood Grill. Not only the plaint is silent of as to the

categorical averment of the appellant/plaintiff being a tenant in his

individual capacity, a reference to the written statement shows that in the

very first preliminary objection thereof the respondent/defendant challenged

the locus standi of the appellant/plaintiff to file the suit because the lease

agreement was not with the appellant/plaintiff but was with M/s. Wendy

Restaurant Pvt. Ltd. Subsequently, in the written statement also it has been

repeated that the tenancy is of M/s. Wendy Restaurant Pvt. Ltd. and the

cheques which were issued to the respondent/defendant were on behalf of

M/s. Wendy Restaurant Pvt. Ltd. Even the security which is agreed to be

paid was said to be payable by the company, though however I may note that

by a typographical mistake instead of writing M/s. Wendy Restaurant Pvt.

Ltd. it has been written as M/s. Pepper Restaurant Pvt. Ltd. In various paras

of the written statement reference to the tenant is mentioned as the tenant

company, and two such paras are paras 8 and 9 of the written statement.

Therefore, once again it is clear that the respondent/defendant categorically

in the pleadings/written statement denied the tenancy in the name of the

appellant/plaintiff, and pleaded the tenancy in favour of M/s. Wendy

Restaurant Pvt. Ltd. and admittedly it is in this company's name M/s.

Wendy Restaurant Pvt. Ltd. through its unit M/s. Hollywood Grill that the

lease deed dated 1.7.1995, Ex.P/1 was entered into.

9. I also do not find any substance in the arguments raised on

behalf of the appellant/plaintiff that it must be held that the

appellant/plaintiff is the tenant because a legal notice dated 19.5.1999 was

sent personally on behalf of the appellant/plaintiff. Firstly, there is no proof

that this legal notice had been served, and which has been disbelieved by the

trial Court. But, even if I accept this notice as proved, that cannot change

the documented fact of the lease deed being with M/s. Wendy Restaurant

Pvt. Ltd. A wishful and self serving statement in a legal notice after disputes

have arisen, and after the tenancy was acted upon by M/s. Wendy Restaurant

Pvt. Ltd., cannot change the tenancy from M/s. Wendy Restaurant Pvt. Ltd.

as the lessee to the appellant/plaintiff. In fact, the appellant/plaintiff had

earlier sent a notice dated 17.10.1998, Ex.PW1/52, and which notice

specifically states that the notice was sent as Director of M/s. Hollywood

Grill. I therefore hold that nothing would turn on the notice Ex.PW1/59

dated 19.5.1999 and the aforesaid facts including of the factum of the lease

deed and the earlier legal notice dated 17.10.1998, Ex.PW1/52 clearly

establishes that the appellant/plaintiff was not a tenant in his individual

capacity.

10. The last argument on behalf of the appellant/plaintiff was that

M/s. Wendy Restaurant Pvt. Ltd. was not in existence as a company on the

date when the lease agreement dated 1.7.1995, Ex.P/1 was entered into and

therefore it must be held that the appellant/plaintiff was a tenant in his

individual capacity. I have already referred to the fact that the lease

agreement has been entered into for and on behalf of M/s. Hollywood Grills

(a unit of M/s. Wendy Restaurant Pvt. Ltd.), and to which aspect the further

fact to be noted is that the company-M/s. Wendy Restaurant Pvt. Ltd. was in

fact subsequently incorporated and there is an incorporation certificate with

respect to the company-M/s. Wendy Restaurant Pvt. Ltd. on record of the

trial Court. This certificate of incorporation is dated 6.9.1995 and was filed

on behalf of the appellant/plaintiff himself in the trial Court. Therefore the

company-M/s. Wendy Restaurant Pvt. Ltd. did come into existence, and

therefore it cannot be said, (since it is not proved otherwise) that the lease

agreement was not entered into for the benefit of and on behalf of M/s.

Wendy Restaurant Pvt. Ltd. (which was incorporated subsequently on

6.9.1995). In fact, during the entire period when the lease was acted upon for

about two years, at no point of time a stand was ever taken up either by the

appellant/plaintiff or by M/s. Wendy Restaurant Pvt. Ltd. that it was not

M/s. Wendy Restaurant Pvt. Ltd. which was the tenant, but it was the

appellant/plaintiff who was the tenant in his individual capacity establishing

that it was the company which was the tenant.

Learned counsel for the appellant sought to rely upon a

judgment of the Supreme Court reported as Commissioner of Income Tax,

T.N. Vs. City Mills Distributors (P) Ltd. (1996) 2 SCC 375 to argue that a

company cannot come into existence before it is incorporated and business

carried on by the company before its incorporation cannot be the business of

the company. Reference is invited to the paras 8 and 9 of the judgment. In

my opinion, the judgment is quite clearly distinguishable on facts inasmuch

as the judgment was dealing with the issue of taxation and the alleged

income of a company prior to incorporation. The issue however in the

present case is not with respect to income of a company and taxation

provisions, but the issue is whether the contract in question being the lease

was for and on behalf of, and for the benefit of company-M/s. Wendy

Restaurant Pvt. Ltd which has been established on record. The judgment

therefore cited on behalf of the appellant/plaintiff cannot change the result of

the present appeals.

11. In view of the above, I do not find any error in the impugned

judgments which calls for interference by this Court. The appeals being

without any merit, are accordingly dismissed, leaving the parties to bear

their own costs. Trial Court record be sent back.

VALMIKI J. MEHTA, J DECEMBER 14, 2011 Ne