(1) This revisional application arises out of a suit filed by Respondents 1 and 2, Original plaintiff's (hereinafter referred to as Respondents 1 and 2) in the Court of Small Causes, Bombay, for ejectment against the 3rd Respondent-original 1st defendant and the Petitioner-original 2nd Defendant . The facts giving rise to this application shortly stated are:
(2) Respondents 1 and 2, at all times material were and are the trustees of a private trust known as ' the Chhotatal Hariram Trust' and as such trustees they are the owners of an immovable property situate at 307-A Bhandarkar Road, Matunga, Bombay.
(3) By an agreement of lease dated May 22, 1923 the trustees for the Improvement of the City of Bombay (the successors where of are the trustees of the Port of Bombay) agreed to demise unto one Kaikhusharu Rustom Irani a vacant piece of land and measuring 643 square yards situate at Bhandarkar Road, Matunga (on which the present property at 307-A has been erected on the terms and conditions therein contained. One of the conditions imposed an obligation on the said Irani to erect buildings and to execute works in accordance with the stipulations, contained in the said agreement. It appears that pursuant to the said stipulations, the said Irani executed the construction work and erected the building on the said plot of land. On compliance with the above covenants, the Trustees for the Improvement of the City of Bombay, by an indenture of lease dated April 19,1925, demised unto the said Kaikhusharu Irani the said land and buildings constructed thereon for a term of 999 years on the terms and conditions contained therein. The construction so put up came to be known as Firdoshi Buildings and later on as Kutchi House.
(4) It appears that there were several assignments of the leasehold interest in the said property and ultimately on June 27, 1950, the said property and the leasehold interest therein was assigned to Respondents 1 and 2. On October 22, 1951, the said property was duly transferred by the Trustees of the Port of Bombay to the name of Respondents 1 and 2 as the trustees of the said trust and thereby recognised Respondents 1 and 2 as the lessees of the said property under the lease dated April 19, 1925.
(5) It appears that in or prior to September 1950 Hari Ramchandra Hagdekar, the 3rd Respondent herein was the tenant of shop No. 1 on the ground floor of the said building paying a monthly rent of Rs. 90 therefor. The 3rd Respondent was carrying on business in the firm name and style of K. L Hindu Hotel as the sole proprietor thereof. By an indenture of assignment dated July 22, 1954, the 3rd Respondent sold his business as a going concern together with the stock and the good will thereof, and incidentally assigned the tenancy rights in the suit shop in favour of one D. J. Salia. It appears that before the execution of the said assignment, the 3rd Respondent had changed the name of his business from K.L Hindu Hotel to 'Sukh Niwas Restaurant'.
(6) It appears that the said D.J Salia changed the name of his business to 'Jai Caf'. On February 15, 1956 the said D.J. Salia sold his business as a going concern together with the good will thereof and assigned the tenant rights in respect thereof to N. M Nayak, to present petitioner before us.
(7) On may 26, 1956 Respondents 1 and 2 terminated the tenancy of the 3rd Respondent by serving a notice to quit. On September 1956 Respondents 1 and 2 ,filed the suit to ejectment from the suit shop against the 3rd Respondent and the Petitioner in the Court of Small Causes, Bombay. The Petitioner was joined in the said suit as he was in the occupation of the suit shop.
(8) The ejectment from the suit shop was sought by Respondents 1 and 2 on numerous grounds.
(9) On April 30, 1959, the Judge of the Court of Small Causes who tried the suit dismissed the same. An appeal therefrom was preferred by Respondents 1 and 2 to the Appellate Bench of the Court of Small Causes Bombay, and the Appellate Court reversed the judgment of the trial Court and decreed the suit of Respondents 1 and 2 on December 20, 1963. The inter alia held that the petitioner, claiming it be an assignee from the assignee of the original tenant, was not entitled to any protection under the Bombay Rents, Hotel and Lodging Houses Rates (Control) Act, 1947, Bombay Act LV of 1947 (hereinafter referred to as the Rents Act). The Appellate Bench of the Court of Small Causes also held that Respondents 1 and 2 reasonably and bona fide required the suit shop for their own purposes. The Court further held that if the petitioner were held to be protected under the Rent Act, then in that event it would cause more hardship to the petitioner if an ejectment decree were to be passed against him. The Bench, however, having found that the petitioner was not entitled to any protection under the Rent Act, decreed the suit against the Petitioner and third respondent and required them to vacate the suit shop by May 31, 1964.
(10) In the meanwhile on March 31, 1964 the petitioner presented this revisional application to this Court. The same was brought for admission on April 20, 1964, and stay of the decree was obtained. This revisional application came up for hearing before Mr. Justice Chandrachud on August 4, 1965. It appears that the petitioner applied for adjournment of the revisional application for 10 days in order to enable him to present an application for converting the revisional application into an application under Article 227, of the Constitution of India, and accordingly, the matter was adjourned. The petitioner then applied for conversion of this revisional application into an application under Art. 227 of the Constitution of India, and on August 13, 1965, the revisional application was referred to the Division Bench.
(11) Mr. Nariman, appearing on behalf of respondents 1 and 2 resisted the application made on behalf of the petitioner for converting this application into an application under Art 227 of the Constitution of India.
(12) Now, it is well established that the High Court would exercise its powers under Art 227 most sparingly in order to prevent gross injustice. The powers under Article 227 are exercised by the Court in is discretion and cannot be claimed as of right by any party.
(13) In the present case, it has been urged by Mr. Nariman on behalf of respondents 1 and 2 that the petitioner is guilty of unreasonable delay in presenting an application under Art.227 and that the conduct of the petitioner is such that the Court should not assist him by exercising its discretion under Art. 227. We dispossession not wish to consider the question of laches inasmuch as we are of opinion that the second ground urged by Mr. Nariman is well founded.
(14) In para. 10 of the affidavit of dayalal D.Doshi affirmed on September 10, 1965 relevant facts have been set out. The fact on which there seems to be no dispute can be summarised as follows;
(15) By an agreement dated July, 1960, Messrs. N. M. Nayak & Sons, a registered partnership firm(in which the petitioner is said to be a partner), purported to grant a leave and licence to one K. Laxman Bhangera, whereby the restaurant business of 'Nayak's Caf' together with all its furniture and fixtures and things lying therein with all its licence permits and good will was given to the said Bhangera for a period of three years commencing from 1st July 1960 on payment of a royalty of Rs. 250 per month. By virtue of this agreement, the physical possession of the suit shop was handed over to the said Bhangera. It appears that the said Bhangera issued pamphlets saying that he was starting business in the name of 'Nayak's Fafe' under new management at the suit shop.
(16) It appears that before the said purported agreement of leave and licence expired, by efflux of time, the petitioner entered into an agreement dated June 1, 1963, with Mysore States Silk Handloom Weavers' Central Co-operative society, Ltd. (hereinafter referred to as the said society). By and under the provisions of the said agreement, the petitioner allowed the said Society to keep stocks for selling their products at the said shop in consideration of the said Society paying a sum of Rs. 425 per month to the petitioner as and by way of fixed minimum commission. It is pertinent to note that under the said agreement, the petitioner was not liable or responsible for the stocks and sales and it was the responsibility of the said society to keep its regular paid employees on terms and conditions mutually agreed upon between the Society and such servants. In substance under the said agreement, the petitioner was required to hand over possession of the suit shop together with the furnitures and fittings therein to the said society and the said society was to carry on business therein.
(17) It appears that one Moraji Hariram purchased a silk blouse piece from the said Society carrying on business at the suit shop. In respect of the said purchase, a bill was issued by the said Society. The delivery of the said blouse piece was given by wrapping the same in a paper bag. A pamphlet issued by the said Society was also inserted in the said paper bag. Copies of the said paper bag, the pamphlet and the bill have been annexed as Exhibit 'C' (Colly.) to the said affidavit. Perusal of the above documents revel that the said Society was occupying the suit shop and was carrying on business therein.
(18) It further appears that on August 28, 1963 counsel and the attorney for respondents 1 and 2 attended the suit shop when some persons who were found therein obstructed them to enter the suit shop. It was also noticed by the legal advisers of respondents 1 and 2 that the petitioner was not carrying on hotel business therein and other persons were carrying on cloth business therein. The respondents 1 and 2 by their attorney's letter dated August 30, 1963, recorded the said facts and intimated to the petitioner's advocate that counsel and Attorney for respondents 1 and 2 would attend the suit shop on September 5, 1963, at the appointed time mentioned therein. The petitioner by his advocate's letter of September 3, 1963 protested against the visit of the counsel and attorney for respondents 1 and 2 to attend the same at the appointed date. The relevant correspondence on the subject has been annexed as 'Exhibit 'D' (Colly.) to the said affidavit. The above facts also reveal that the petitioner was not occupying the suit shop and the said Society was carrying on business therein.
(19) From the tenor of the said agreements, it is clear that the object of the petitioner was to circumvent the provisions of the Rents Act and to make large profits by allowing the suit shop to be used and occupied by others. The rent of the suit shop was Rs. 90 per month and the petitioner was realising Rs. 250 per month from the said Bhangera and Rs. 425 from the said society. In our opinion, these agreements are nothing but camouflage and were resorted to by the petitioner to make unjustifiable gains.
(20) The above conduct of the petitioner sufficiently indicates that the petitioner has not approached the Court with clean hands and he has, therefore, disentitled himself from invoking the jurisdiction of this Court under Art. 227 of the Constitution and we are not prepared to assist the petitioner by exercising the discretion vested in us. We also refuse to exercise powers under Article 227, as there is not possibility of any grave injustice being caused to the petitioner.
(21) In addition there to, we dispossession not think that this is a fit case in which the Court's powers under Art. 227 should be invoked. It is not the complaint of the petitioner that the Court below had not jurisdiction to consider the questions raised before it or that the Court below refused to exercise the jurisdiction vested in it. The only ground urged by Mr. Singhvi on the question was that there is an error on the face of the record and, therefore, this Court should exercise the jurisdiction vested in it under Art. 227. In our opinion, there is no error on the face of the record which calls for any interference under Article 227 of the Constitution.
(22) Under the circumstances, we are not inclined to allow the petitioner to convert the civil revisional application into the application under Article 227 of the Constitution as applied for by the petitioner. We, therefore, reject the petitioner's application for conversion.
(23) Thereupon, this matter was argued as a civil revision application. On behalf of respondents 1 and 2 , Mr. Nariman raised a preliminary objection and contended that no revisional application lay as there is neither want of jurisdiction nor refusal to exercise jurisdiction nor any material irregularity in exercise of jurisdiction by the Bench of the Small Causes Court. We, therefore, propose to consider this preliminary contention first before we consider the revisional application on merits .
(24) Now, the petitioner has attacked the judgment and finding of the Bench of the Small Causes Court and has urged that it has misconstrued the provisions contained in section 15 of the Rent Act and the notifications issued thereunder. According to the petitioner's submissions, the Court below was in error in holding that the assignee of an assignee of the business premises is not protected under the Rent Act. In substance it means that the Small Causes Court has decided the question of law that arose before it erroneously. Now it is well known that the powers under section 115 of the code of Civil Procedure can only be invoked in cases where the Court subordinate to the High Court has exercised the jurisdiction not vested in it by law or has failed to exercise the jurisdiction vested in it or has acted in exercise of its jurisdiction illegally or with material irregularity. The High Court in exercise of its revisional jurisdiction will not interfere with the findings of the Court subordinate to it both on questions of law as well as on questions of fact, even if the High Court is of the opinion that the decision of the subordinate Court is erroneous thereon. Therefore, merely because the subordinate Court has given an erroneous decision on the question of law that fell within its jurisdiction the revisional powers under section 115 cannot be invoked.
(25) Mr. Singhvi, however, says that a jurisdiction fact or legal determination is never conclusive, since no Court can give itself jurisdiction by wrongly determining fact or law, and contends he that the construction of sections 14 and 15 of the Act is such determination. We cannot accept the contention. Jurisdictional question law or fact has well known connotation. It means collateral question which the Court has to decide to ascertain whether it has jurisdiction and has nothing to dispossession with the merits of the case. In the present case, the question whether the Court has jurisdiction or not depends on the question whether the dispute is between the landlord and tenant and secondly, whether it relates to possession or a question arises under the provision of the Act. The petitioner claims protection under sections 15 and 14 of the Act and it is a question which arises under the Act. The Court therefore, had jurisdiction to determine the meaning of sections 15 and 14 and also the question whether he is entitled to the protection of the Act. This is merely the merits of the case, and the Court's decision on merits whether of law or fact can never be a question of jurisdiction.
(26) The arguments advanced by Mr. Singhvi would at the most mean that the findings of the Appellate Bench of the Court of small Causes are erroneous on interpretation of section 15 and the notification issued thereunder; but the same cannot be a valid ground for us to interfere in revision under section 115 of the Code of Civil Procedure. We, therefore, uphold the preliminary objection urged by Mr. Nariman.
(27) We, however proposes to consider the question raised by the petitioner on merits as in our opinion, the decision of the Court of Small Causes is right on those question. The first question canvassed by Mr. Singhvi before us is that the petitioner is a lawful assignee of the suit shop and is therefore, a tenant as defined in section 5(11) of the Rent Act. Let us now determine that question. For the purpose of ascertaining whether the petitioner is a lawful assignee of the suit shop, one has to turn to the provisions of section 15 of the Rent Act and the notifications issued thereunder.
(28) Section 15(1) prohibits sub-letting or assignment or transfer of any interest by any tenant after the coming into operation of the said Act despite any law providing contrary thereto. An exception thereto is carved out by inserting a proviso to that sub-section. By that proviso, the State Government is authorised to issue notification in the Official Gazette permitting transfer of interest in premises held under such leases or class of leases and to such extent as may be specified in such notification. In exercise of the powers contained in the proviso, to sub-section (1) of section 15, several notifications have been issued by the State Government. One of such notifications provides: 'The Government of Bombay is pleased to permit in all areas to which Part II of the said Act extends, all transfers and assignments by lessees of their interests in leasehold premises as and to the extent specified in the Schedule hereto' and one of the things that has been specified in the Schedule thereto is '(2) Transfer or assignment incidental to the sale of a business as a going concern together with....'. Therefore a person seeking to claim protection afforded by the provisions contained in this notification must establish that his transferor was a lessee of the premises must satisfy the character of a lessee. What we are, therefore, required to ascertain in this case is whether D.J. Salia who himself was an assignee of the suit shop, was a lessee of the premises in question. Now, the expression 'lessee' used in the notification has not been defined under the Rent Act. One has, therefore, to ascertain the meaning of 'lessee' by reference to the provisions contained by the Transfer of property Act. Section 105 of the Transfer of Property Act defines 'lease' and 'lessor' and 'lessee'. It runs as follows:-
'105 A lease of immovable property is a transfer of a right to enjoy such property , made for a certain time, express or implied or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms.
The transferor is called the lessor, the transferee is called the lessee, the price is called the premium, and the money, share, service or other thing to be so rendered is called the rent'.
Having regard to this definition the transferee of an interest in immovable property is called the lessee. The assignee of a lessee cannot by any stretch of imagination be termed as 'lessee' as defined by the Transfer of Property Act. An assignee of a lessee has privity of estate but there is no privity of contract between the assignee of a lessee and the lessor. Mr. Sihghvi on behalf of the petitioner, has however, contended that the petitioner being an assignee of the whole interest of his predecessor-in-title, must be deemed to be a 'lessee' as defined under the Transfer of Property Act. We are afraid that we cannot accept the correctness of that argument. It is well known that an assignee of a lessee is not synonymous with or equivalent to the lessee. The relationship between the lessor and the lessee springs up from the contract, whereas the relationship between the lessors and the assignee of the leasehold interest either absolutely or partially springs up from the privity of estate. The distinction between an assignee of a lessee and the lessee is well-known. Section 108(i) of the Transfer of Property Act, itself recognises such distinction. In terms, it lays down that notwithstanding the assignment, the lessee shall continue to be liable for the performance of his obligation to the lessor. If one needs any authority for the same, they are found in Narayan Jieu v. A. C. Banerjee, ILR (1953) Cal 362; Ardeshar Cowasji Patel v. K. D. and Brothers. AIR 1925 Bom 330; and Treasurer of Charitable Endowments v. S. F. B. Tyabji 50 Bom LR 240= AIR 1948 Bom 349 The Division Bench of this Court in 50 Bom LR 240= AIR 1948 Bom 349 has held that a lessee cannot by his unilateral act of assignment of his interest in the leasehold premises put an end to his obligations which he has undertaken either by the contract o9f lease or under the statute under section 108 of the Transfer of Property Act.
(29) Mr. Singhvi on behalf of the petitioner has not brought to our notice any authority or any provision of law showing that an assignee of a lessee is the same or is equivalent to a lessee.
(30) In view of the above discussion, in our opinion, the petitioner is not a lawful assignee of the
suit shop by virtue of the notification issued under the provisions of section 15(1) of the Rent Act.
(31) Much argument was advanced on the construction of section 15(1) of the Act. It may be recalled that Hegde was the lessee under the landlords. He assigned the business to one Salian on July 22, 1954 and the latter assigned the same to the petitioner on February 22, 1965. The landlords then terminated the tenancy on May 26, 1965. It was contended that Salian was a tenant within the meaning of section 15(11) (a0 and (aa) and if so, under section 15(1) he had a right to assign the business to the petitioner. According to Mr. Singhvi the word 'tenant' in section 15 must have the same meaning as given to it by section 5(11) . It is argued that if the word 'tenant' in section 15 is construed as a contractual tenant, then difficulty would also arise in the application of section 13 (e0 of the Act, for then that section also must be limited to such a tenant and any other person cannot be evicted.
(32) Even if this meaning were given to the word 'tenant' in section 15(1) the contention must fail for the reasons mentioned earlier. It is under the proviso to section 15(1) read with the relevant notification of the Government that the right of assignment the business arises, and not otherwise. Since the proviso itself is intended to except such leases or class of leases any may be specified, unless what is assigned is a lease by the lessee, the assignment must be held to be bad. Apart from that the notification itself is limited in scope as stated above.
(33) The expression 'tenant' employed in this sub-section means the contractual tenant and not the statutory tenant. See Anand Nivas Private, Ltd., v. Anandji Kalyanji's Pedhi, : 4SCR892 . Therefore the Legislature did not intend to extend any protection to the tenants of the sub-tenants or to assignees or transferees of the sub-tenants or to the sub-tenants, assignees or transferees of the assignees or transferees by introducing the proviso to that sub-section authorising the Government to issue notification granting sub-leases.
(34) Similar contention was raised in : 4SCR892 and rejected. Mr. Justice Shah. Says (in Para 34):
'The argument that by restricting the operation of section 13(1)(e) to contractual tenants sub-letting by statutory tenants would be protected is without force. Section 12 and 13(1) have to be read together. Clause (e) of section 13(1) entitles a landlord to obtain possession where a contractual tenant has during premises or assigned or transferred his interest therein. Where a statutory tenant has purported to sublet the premises, or has purported to assign or transfer his interest therein, and in pursuance of such a transaction parted with possession he would forthwith forfeit the protection which the statute accords to him by section 12(1)'
(35) In a case like the present so far as the first tenant is concerned if his sub-letting or assignment is contrary to the Act, he would be evicted. If the assignee of an assignee of the lease is not a tenant, as we have held that he is not, he is not protected and must be evicted. So far as the first tenant and his assignee are concerned, there is nothing to protect as they are not in possession . At best, Salian was a 'tenant' but as he assigned to the petitioner he cannot be protected.
(36) It was argued that if section 15(1) cannot apply an assignee of a tenant has an estate or interest in the property and therefore he would be entitled to assign it to another under the Transfer of Property Act and therefore the petitioner cannot be evicted. The contention overlooks the very provisions of section 15(1) of the Act which operates 'notwithstanding anything contained in any law'. The effect is that the Transfer of Property Act must stand abrogated in view of the restrictions regarding assignment and sub-letting contained in section15(1) read with the proviso. The rights of the lessee to assign the lease or sub-let would therefore be only such as is permitted by section 15(1) and its proviso. This was decided in Chimanlal Ganpatdas v. Subashchandra Premsukh Hati C.R. A. No. 157 of 1955 D/-8-2-1956 (Bom) by Shah J., and we respectfully agree with the same.
(37) In view of the above conclusion arrived at by us on the construction of section 15(1) of the Rent Act and the notification issued thereunder, it is not necessary to consider the correctness or property of the reasons assigned by the Court below for reaching to the conclusion that the assignment of the suit shop to the petitioner is not protected by the Rent Act. However, we are of opinion that the reasons assigned by the Court below for reaching to the conclusion to which it arrived at, are prima facie correct.
(38) For the above reasons we hold that the petitioner was not a lawful assignee of the suit shop and consequently is not a tenant as defined under section 5(11) of the Rent Act. The petitioner has therefore, not derived any valid title to the suit shop as an assignee thereof and is therefore not entitled to any protection of the provisions contained in the Rent Act.
(39) Mr. Singhvi also urged that the petitioner became a tenant of the suit shop on the determination of the tenancy of the third respondent. The determination of this question was dependent upon the petitioner being held to be lawful assignee of the suit shop. As we have held that the petitioner is not the lawful assignee, the petitioner cannot claim the benefit of section 14 of the Rent Act.
(40) The last contention urged by Mr. Singhvi was that even if we hold that the assignment in favour of the petitioner was unlawful, the petitioner is entitled to claim immunity by virtue of sections 15(2) of the Rent Act, Section 15(2) of the Rent Act provides:
'15(2) The prohibition against the sub-letting of the whole or any part of the premises which have been let to any tenant, and against the assignment or transfer in any other manner of the interest of the tenant therefore contained in sub-section (1) shall, subject to the provisions of this sub-section, be deemed to have had no effect before the commencement of the Bombay Rents, Hotel and Lodging House Rates Control (Amendment) Ordinance, 1959 in any area in which this Act was in operation before which this Act was in operation before such commencement; and accordingly, notwithstanding anything contained in any contract or in the judgment decree or order of a Court, any such sub-lease, assignment or transfer in favour or any such purported sub-lease, assignment or transfer in favour of any person who has entered into possession despite the prohibition in sub-section (1) as a purported sub-lessee, assignee or transferee and has continued in possession at the commencement of the said Ordinance, shall be deemed to be valid and effectual for all purposes and any tenant who has sub-let any premises or part thereof, assigned or transferred any interest therein., shall not be liable to eviction under clause (e) of sub-section (1) of section 13'
Sub-section (2) partially nullifies the bar against sub-letting, assignment or transfer imposed by sub-section (1) or by any contract or judgment with retrospective effect, provided the sub-lessee, transferee or assignee has entered into possession prior to the commencement of the Bombay Rent Ordinance III of 1959, i.e., prior to May 21, 1959 and has continued to remain in such possession of such date. The protection sought to be afforded by this sub-section extends to sub-lessee, assignee or transferee and does not extend to sub-lessee of sub-lessee or assignee or transferee or to assignee of sub-lessee or assignee or transferee. As observed earlier, in Anand Nivas Pvt. Ltd., case, : 4SCR892 the Supreme Court has held that section 15(1) applies to a contractual tenant or lessee. The transferee of a lessee is not a contractual tenant. The Legislature whilst introducing sub-section (2) intended to validate the sub-letting transfer and assignment by tenants and not further sub-letting or further derivative transfer or assignment by such sub-lessees, transferees or assignees. In our opinion the protection intended to be conferred by the Ordinance can be availed of by only those persons who can be described as sub-lessees, assignees or transferees from the contractual tenant. Our attention was invited to the judgment of Mr. Justice Chandrachud in Balkrishna Maruti v. Saidanna Sayanna : (1963)65BOMLR149 , where similar observations as to construction of section 15(2) of the Rent Act have been made. We, therefore, hold that the Court below was right in holding that the petitioner was not entitled to claim any protection by virtue of section 15(2) of the Rent Act.
(41) The lower Court has also held that the landlord themselves were tenants and Hegde himself was a sub-tenant and he could not further assign his sub-tenancy to Salian on the reasoning above.
(42) The result is that this revision application fails and the same is dismissed with costs. Rule discharged.
(43) Mr. Singhvi orally applies for leave to appeal to the Supreme Court. He says he is entitled to appeal as a matter of right under Article 133(b). Article 133(b) was never intended to apply to cases such as the present where the judgment is one of concurrence. Certificate refused.
(44) Petition dismissed.