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P.V.S. Vencatachellum Vs. P.V.S. Kabalamurthy Pillai - Court Judgment

LegalCrystal Citation
SubjectFamily;Property
CourtChennai High Court
Decided On
Case NumberC.S. No. 450 of 1950
Judge
Reported inAIR1955Mad350
ActsHindu Law; Transfer of Property Act, 1882 - Sections 10 to 17; Mohomedan law; Indian Companies Act; Madras Buildings (Lease and Rent) Control Act, 1946 - Sections 7; Constitution of India - Article 19 and 19(1)
AppellantP.V.S. Vencatachellum
RespondentP.V.S. Kabalamurthy Pillai
Appellant AdvocateK.S. Ramaratnam, Adv.
Respondent AdvocateC. Venugopalachariar, Adv.
Cases Referred(f). Jeewan Ram v. United State of Rajasthan
Excerpt:
property - eviction - hindu law, sections 10 to 17 of transfer of property act, 1882, mohammedan law, indian companies act, section 7 of madras buildings (lease and rent) control , 1946 and article 19 and 19 (1) of constitution of india - suit for declaration that plaintiff was entitled to continue in possession, use and enjoyment of suit properties and defendant was only entitled to reasonable rent payable to him - plaintiff also sought to restrain defendant from executing order of eviction obtained by him against plaintiff - plaintiff was a bare tenant of suit premises and he did not had any right to property itself - alleged family arrangement between parties about suit properties was not reliable since members were not aware of their rights - goodwill in present case was a personal.....ramaswami, j.1. suit is for a declaration that the plaintiff has not been and is not a bare tenant as from month to month under the defendant of the buildings and premises described in the plaint schedule and that by reason of the arrangements and conditions and covenants referred to in the plaint, the plaintiff is entitled to continue in possession, use and enjoyment of the said items of property so long as the plaintiff is carrying on the condiments business of p. vencatachellum and that the defendant is entitled only to such reasonable rents payable to him or such reasonable rents as may be agreed to or determined from time to time; that the defendant be restrained by a permanent injunction from executing or otherwise enforcing against the plaintiff the order of eviction obtained by.....
Judgment:

Ramaswami, J.

1. Suit is for a declaration that the plaintiff has not been and is not a bare tenant as from month to month under the defendant of the buildings and premises described in the plaint schedule and that by reason of the arrangements and conditions and covenants referred to in the plaint, the plaintiff is entitled to continue in possession, use and enjoyment of the said items of property so long as the plaintiff is carrying on the condiments business of P. Vencatachellum and that the defendant is entitled only to such reasonable rents payable to him or such reasonable rents as may be agreed to or determined from time to time; that the defendant be restrained by a permanent injunction from executing or otherwise enforcing against the plaintiff the order of eviction obtained by him against the plaintiff and from otherwise interfering with the peaceful enjoyment of the premises by the plaintiff; and for costs.

2. The facts are--In the city of Madras Sri P. Venkatachalam belonging to the Adi-dravida community founded about 95 years ago a business in condiments which throve and prospered and had a large export trade to England where the old retired Anglo-Indians relished greatly the spices of the East out of which these condiments are prepared. The preparation of these condiments was being done in the premises bearing door Nos. 5, 6 and 7. Umphersons Street, adjacent to Broadway. The office portion was being carried on in premises No. 2, Pophams, Broadway. In fact all these buildings are within a stone's throw of the High Court. (For a historical account of these well-known places see Umpherson Street--Origin of name Vol. III, 448 N. 7, 573 and for Popham's Broadway, Vol. III, pages 447-449 of Col. Love Vestiges of old Madras published in three volumes with index volume in the Indian Records Series).

3. There was a partition suit in C. S. No. 238 of 1905 which terminated in a final consent decree on 14-11-1918. In these proceedings we are not concerned with that partition suit.

4. This Sri P. Venkatachalam had a son by name P.V. Subramania Pillai who carried the business after his father. (We are not concerned here wife the other four sons of Sri P. Venkatachalam). This Subramania Pillai had three sons by name P.V.S. Kabalamurthi Pillai (the present defendant), P.V.S. Kumaravelu Pillai and Sambasiva Pillai. The present plaintiff is the son of that Sambasiva Pillai and Muthulakshmi Ammal and he had a sister by name Mohanambal. Sambasiva Pillai died in 1916.

In the year 1921 C. S. 794 of 1921 was filed for an account being taken of the properties belonging to the joint family consisting of the parties to that suit viz., Kabalamurthi Pillai (plaintiff therein), P.V. Subramanya Pillai (defendant 1 therein), P.V.S. Vencatachellum (defendant 2 therein and the present plaintiff), Mohanambal (defendant 3 therein) Muthulakshmi Animal, widow of Sambasivam Pillai (defendant 4 therein) and P.V. Kumaravelu Pillai (defendant 5 therein) of the profits of the business relating to the manufacture of condiments and ice from 1-1-1919 and of the liabilities of the joint family; for sale of such items as may be necessary of the properties mentioned in Schedule II of the plaint for the discharge of the liabilities of the family; for appointment of a Receiver and Manager of the said business relating to the said manufacture of condiments and ice; for the division of the residue thereafter among the parties to the suit etc. In that suit the present plaintiff was a minor represented by his grandfather as guardian 'ad-litem'.

5. This suit terminated in a consent decree and so far as we are concerned here two relevant paragraphs of the decree are paras. 5 and 6 and they are as follows:

'5. That P. V. S. Kabalamurthi Pillai, the plaintiff herein, do take immediate possession of the premises Nos. 5, 6 and 7 Umpherson Street, G. T. Madras, and premises No. 2, Pophams Broadway, Madras.

6. That the said P.V. Subramaniam Pillai, defendant 1 do take the said premises Nos. 5, 6 and 7, Umpherson Street, on lease for five years from P.V.S. Kabalamurthi Pillai, the plaintiff, at Rupees Two hundred and fifty five (Rs. 255) month the said P.V. Subramaniam Pillai makingall repairs, paying all the taxes himself and dodeduct the amount thus incurred from the rentsand that the said P.V. Subramania Pillai, defendant 1, do further have a lease of premises No. 2,Broadway, at the sum of Rupees one hundred(Rs. 100/-) a month, for the first five years andif required at Rupees One hundred and twenty-five (Rs. 125/-) a month, for the second five years,P.V. Subramaniam Pillai paying all taxes, ratesetc., and do deduct such amounts thus expendedfrom the monthly rent and that the said rentsbe payable month after month about the 15th ofeach and every succeeding month and that thearrears of rent do bear interest at 9 per cent, perannum and that the said P.V.S. KabalamurthiPillai, the plaintiff shall have no power to sell orotherwise alienate the said properties Nos. 5, 6and 7, Umpherson Street, and No. 2, Pophams,Broadway, Madras, except with the written consent of the said P.V. Subramaniam Pillai,defendant 1.'

In this connection it may be pointed out thatsimilar provision regarding non-alienation withoutthe previous consent in writing of Subramania Pillaihas been made in regard to No. 21/22, Stringer'sStreet, Madras. This decree was passed on 1-8-1922,

6. In 1937 the present plaintiff P.V.S. Vencatachellum filed C. S. 32 of 1937 for division among the members of the family the business in condiments together with the machinery, stock-in-trade, outstandings and contracts and other assets on the foot of the following allegations: The terms of the decree in C. S. 794 of 1921 passed on 1-8-1922 provided that the condiments business which included the goodwill and the benefit of all contracts should be the exclusive property of P.V. Subramania Pillai until his death and that after his life-time the same should devolve in equal shares amongst the plaintiff, defendant 1 (Kabalamurthi Pillai) and defendant 2 (Kumaravelu Pillai) in that suit.

P.V. Subramaniam Pillai having made default indischarging the debts subsisting on the propertiesallotted to the share of the plaintiff and defendants1 and 2 therein in the manner it was directed to bedone under the aforesaid decree, receivers wereappointed by the High Court and at the time whenP.V. Subramania Pillai died on or about 16-9-1933the business in condiments was managed and conducted by G. Gompertz, receiver appointed byCourt, and still continues to be managed by him.For sometime past there has been differencesbetween the members of the family and it has nowbecome impossible to carry on the business in cooperation. The plaintiff therefore sought to havehis 1/3rd share in the business partitioned andallotted to him.

7. There was a consent memo filed on 31-3-1937 to the effect that the good will of the business together with the machinery and stock-in-trade and benefits of contracts shall be sold among the parties and whoever makes the highest bid shall be declared to be the purchaser.

8. This suit was disposed of by Gentle, J. on 31-3-1937 and Mr. Gompertz was appointed Commissioner to hold the auction. In the auction held (sic) Mr. Gompertz what was sold was as mentioned in the report of Mr. Gompertz viz., the businessknown as P. Vencatachellum condiment businesscarried on at Nos. 1 and 2, Broadway, Madras,together with the machinery, stock-in-trade, outstandings and contracts and other assets availablefor division and which have been specified furtheras (1) the leasehold interest in (a) No. 1, Broadway,(b) No. 1/2, Poonamallee High Road, (c) Nos. 5and 6, Umperson Street; and (2) Office furniture,machinery and powder cart. The sale, it was furtherclearly, specified, did not include 177 cases of currypowder and six casks of condiments all markedJAS London, and awaiting shipment. The plaintiffwas the highest bidder for Rs. 1,58,000/- and wasdeclared the purchaser.

9. On an application made by P.V.S. Vencatachellum in furtherance of this auction sale the report of the Commissioner was confirmed and the plaintiff was declared the sole and absolute owner of the business known as 'P. Vencatachellum' together with the good will thereof and the other assets mentioned in the report of the Commissioner.

10. On 20-4-1937 Gentle J. gave a final decree 'that the plaintiff P.V.S. Vencatachellum be and is hereby declared the sole and absolute owner of the business known as 'P. Vencatachellum Condiments' together with the good will thereof and the other assets set out in the schedule hereto' which narrated the same assets as mentioned in the Commissioner's report.

11. Then in 1949 the present defendant Kabalamurthi Pillai filed before the Rent Controller, Madras, L. Dis. No. 7914 of 1949 (HRC). This Kabalamurthi sought eviction of the plaintiff in respect of premises No. 2, Broadway, and Nos. 5, 6 and 7, Umperson Street, G. T. Madras and the material allegations in para. 3 are as follows: 'The petitioner is the owner of premises No. 2, Broadway, and Nos. 5, 6 and 7 Umpherson Street, George Town, Madras, all in a block and the respondent is a tenant under the petitioner for premises No. 2, Broadway, George Town, Madras, Nos. 5, 6 and 7, Umpherson Street, G. T. Madras, on a consolidated rental of Rs. 532-8-0 a month and all the premises are non-residential buildings used by the respondent for years past for business purpose.'

The learned Rent Controller Janab Mohideen Batcha passed the following order: 'The petitioner and the respondent are present. The evidence of P. W. 1 shows that the respondent is in arrears from 1-12-1949. The respondent admits default but he states that he never paid rent month after month and that he used to pay rents once in 5 or 6 months. Section 7 (2) (i) of the Act casts a duty on the tenant to pay or to tender each month's rent to the landlord within the end of the succeeding month. I find that there was default in payment of rent. Order for eviction is passed.' (12) There was an appeal by the present plaintiff before the appellate authority viz., the Court of Small Causes, Madras, in H. R. A. No. 339 of 1950, The ground of appeal was that the Rent Controller was wrong in holding that there has been a default and that the practice in this case was not to pay rent every month punctually but pay it once in ten months and on two prior applications Kabalamurthi, due to this peculiar custom prevailing among the parties, did not press for eviction. Then in ground No. 5 the present plaintiff stated as follows:

'The learned Rent Controller failed to note that the business run by the respondent was an ancient business and that the petitioner was no other than his uncle who was once a co-sharer in the business, and that the business was sold in court auction and purchased by the respondent, and allowed the petitioner to occupy the premises, and pay the rents whenever it was convenient to him or whenever the petitioner wanted money.' This appeal was dismissed on 25-9-1950.

13. The plaintiff has thereupon filed this suit in 1950 for the reliefs reproduced above and he bases this relief on the following legal grounds. Firstly, he states that from a careful study of the terms of the partition decree of the 1921 suit, it was the common understanding and agreement of all the members of the family, or more compendiously there was a family arrangement, that all the four items of the buildings should be in the nature of appendages of and appurtenant to the said business of condiments as it would not be possible to carry on the said business efficiently or profitably otherwise.

Secondly, as a result of the carrying on of this trade or business, good will has become attached to the premises and has become in the nature of covenants and conditions under which the member of the family who carries on the said condiment business of P. Vencatachellum should be entitled to possess and enjoy for the purpose of the said business the said four premises.

Thirdly, inasmuch as in law and in equity the plaintiff has become a life tenant and not a mere tenant under the ordinary law of landlord and tenant to which alone the Rent Control Act refers and applicable, the eviction under the Rent Control Act is illegal and void.

Fourthly, the right claimed by the plaintiff in respect of the suit premises is also in the nature of legal and equitable right provided in Sections 10 and 11, Transfer of Property Act and though a Bench of this Court has held that the Rent Control Act must be construed as impliedly rescinding and repealing the Transfer of Property Act, that decision is not correct and is also against the principles of other decisions of this Court and that under certain circumstances though the question was attempted to be taken for the decision of the Supreme Court, that attempt fell through and that the plaintiff does not wish to give up this contention as even if this court should eventually decide in the same way with regard to that question, the plaintiff is anxious to take the point for determination to the Supreme Court.

Fifthly, the Rent Control Act is 'ultra vires' of the Constitution of India and the fundamental rights thereby guaranteed.

14. The defendant denied all these allegations and contended as follows: On a proper construction of the partition decree the grandfather of the plaintiff will be found to have become a tenant under the defendant for a period of five years in respect of the premises Nos. 5, 6 and 7 Umpherson Street, on a monthly rent of Rs. 255/- commencing from 1-8-1922 and with regard to premises No. 2, Broadway, the tenancy was only for a period of five years with a provision for a further period of five years on an enhanced rent of Rs. 125.

The compromise decree in C. S. 794 of 1921 'inter alia' provided that Subramania Pillai, defendant 1 in that action, should for his lifetime enjoy the income of the business and that after his death, this defendant, his brother Kumaravelu and the plaintiff in this action shall be entitled to the conduct of the business jointly. After the death of Subramania Pillai in 1938 disputes and differences arose between the parties and they could not agree to a joint running of the business and the business was sold under orders of Court. The plaintiff was the purchaser therein and the other members of the family received from the plaintiff their respective shares out of the sale proceeds. After the sale the plaintiff continued to occupy the said premises as the defendant's tenant and was liable to pay a rent of Rs. 255/- for Nos. 5, 6 and 7, Umpherson Street, and Rs. 100/- for No. 2, Broadway, which were the rents fixed originally at the time of the compromise in 1922.

The clause in the compromise decree that the defendant should not alienate any of the properties without the written consent of his father, the late Subramania Pillai, was intended to be for his benefit only as the other signatories to the compromise agreed that the said Subramania Pillai should have a free and undisturbed hand in the running of the business which ultimately after his death was to devolve upon this defendant and other persons. In any event, the clause being one in the nature of a restraint on alienation is not only void but must be deemed to have come to an end with the death of Subramania Pillai in 19S3. It was never contemplated, much less expressly provided for, that premises. Nos. 5, 6 and 7, Umpherson Street, and No. 2 Broadway, should be adjunct to the business or that they should always be appendages to the business of P. Vencatachellum and Sons.

The contention of the plaintiff that rights of permanent tenancy have been conferred upon him under the terms of the razinama decree in G. S. Nos. 238 of 1905 and 794 of 1921 is not well founded. In any event, the decree passed in C. S. 32 of 1937 under the terms of which the plaintiff became purchaser of the condiment business does not justify the present claim. In the suit filed by this plaintiff in 1937 the stand taken by him was that he was a co-owner having a one-third interest in the business only and all that was implied by the terms of the sale was that whosoever was the purchaser, other than this defendant, would be treated as tenant. It did not mean that this defendant thereby professed to confer rights of permanent tenancy to any one over his properties. The plaintiff was always aware of his legal rights and has always comported himself as an ordinary tenant liable to be evicted for proper cause and it was on that basis a 50 per cent, rise was allowed on the rent. The present contention has been advanced only after the plaintiff has failed by every device to defeat and delay the eviction order passed against him.

(15) On the pleadings the following issues were framed;

'1. Was the manufacturing part of the business of P. Vencatachellum at premises Nos. 5, 6 and 7, Umpherson Street and the sale part of the business at No. 2 Broadway carried on in the respective premises from the very commencement of that business, and have the said premises in consequence become part of the goodwill of the said business?

2. Was the allotment of the said premises in Umpherson Street and Broadway to P.V. Subra-maniya Pillai under the decree in C. S. 238/50 made in consideration of the said properties being in the nature of an appendage and as being necessary for the carrying on the said business, and was it for the same reason that the allotment of the said properties to the defendant in C. S. 794/21 was coupled with the conditions against alienation set out in the decree?

3. Was the arrangement that the said business should be carried on in the said premises in the nature of a family arrangement and was it for the benefit of the said business as alleged in para. 11 of the plaint?

4. Is the agreement pleaded in para. 17 of the plaint true, and if so, what is its legal effect?

5. Was the order of eviction obtained by the defendant against the plaintiff in respect of the said premises in fraud of the plaintiff's rights as alleged in paras 18 and 19 of the plaint?

6. Was the plaintiff not a bare tenant of the said premises from the defendant and has the plaintiff any rights to the property itself, legal or equitable, as claimed in para. 20 of the plaint?

7. Are the provisions of the Bent Control Act at variance with the Transfer of Property Act, illegal and not enforceable for the reasons set out in paras. 11 and 23 of the plaint?

8. Are the provisions of the Rent Control Act so far as they are inconsistent with the Transfer of Property Act invalid for the reasons alleged in paras 24 and 25 of the plaint?

9. Is the plaintiff as the owner and proprietor of P. Vencatachellum entitled to the use and occupation of the said premises on payment of reasonable rent to the defendant as claimed in the plaint?

10. Is the plaintiff entitled to the declaration and injunction prayed for?

11. To what reliefs are the parties entitled?'

16. Before me no oral evidence was adduced and the agreed bundle of documents, comprising Exs. P-1 to P-15, was filed.

17. On a review of the entire circumstances of the case I have come to the conclusion that the family arrangement pleaded is untrue; that the goodwill has not become attached to the premises; that the life tenancy co-terminus with the extinction of the business claimed is illegal under Sections 10 and 11, Transfer of Property Act and inequitable on the facts of this case; that the eviction, was properly made under the Rent Control Act and not the Transfer of Property Act, and that the Rent Control Act is 'intra vires' of the Constitution of India. Here are my reasons.

18. POINT 1: It is no doubt true that a family arrangement stands on a similar footing as a compromise. It is an arrangement come to between (sic) or members of a family, who have their own unadmitted rights to be pressed against one another, in order to avoid litigation and for the benefit, peace, security or preservation of the property in dispute, and to such an arrangement great importance is attached by the Courts: -- 'Sidh Gopal v. Bihari Lal', : AIR1928All65 ; -- 'Mt. Binda Kuer v. Lalita Prasad AIR 1936 PC 340 (B); -- 'Mst. Hardei v. Bhagwan', AIR 1919 PC 27 (C); -- 'Bishambar v. Amarnath .

In the absence of proof of mistake, inequality of position, undue influence, coercion, or like ground, a family arrangement made in settlement of the disputed or doubtful claim is a valid and binding arrangement which the parties thereto cannot deny, ignore or resile from, and this principle is applicable where some of the members of the family are minors, or where the settlement has been effected by a qualified owner whose act in this respect will bind the reversioners: -- 'Dangal Ram v. Jaimangal', : AIR1926Pat364 (E).

But in this case no such family arrangement has been made out. No person who could throw any light on this family arrangement has got into the box and spoken about it. The family arrangement is not supported by the compromise decree in C. S. No. 794 of 1921. I have reproduced the relevant extracts relating to the suit property and all that it shows is, as contended for by the defendant, that Subramania Pillai, grandfather of the plaintiff and father of the defendant, was to have a lease of the Umpherson Street property for five years and was to have a lease of the Pophams Broadway property for a period of five years with an option of renewing the same for a further period of five years and that he was to conduct the business in which the plaintiff and the defendant had shares free and undisturbed by the other coparceners and that during that specific period of lease Kabalamurthi Pillai was not to alienate the property without the written consent of Subramania Pillai.

This is the only arrangement which has been come to and from that I am unable to spell out an elaborate family arrangement now put forward and which is a complete rewriting of this written agreement, not permissible under Section 92, Evidence Act. It is significant that in regard to No. 21/22 Stringer's Street, Madras, wherein Kumaravelu Pillai had been given absolute possession and enjoyment and made the absolute owner thereof, with a covenant that he had no power to sell or otherwise alienate the said property without the previous consent in writing of P.V. Subramania Pillai, nobody has ever thought of setting up any such family arrangement as is now sought to be set up in regard to this Umpherson Street and Broadway properties. In fact, as I shall show later, such an arrangement offending the provisions of Sections 11 and 12, Transfer of Property Act would not have been incorporated by the eminent counsel who appear to have drafted this compromise. I shall discuss this aspect of the case later when coming to deal with Sections 10 and 11, Transfer of Property Act.

This family arrangement if it were true could have been adhered to in the subsequent consent decree in C. S. No. 32 of 1937 but such is not the case. In this suit, as the relevant extracts reproduced above show, all that was sought to be sold was the business of P. Vencatachellum condiments along with the goodwill of the business specified as machinery, stock-in-trade, benefits of contracts and leasehold interest in these suit properties and there is no claim whatsoever about the covenants and conditions which are now set up as part of the family arrangement. The plaintiff has at no time looked upon himself under any such family arrangement as a permanent tenant and in fact I have reproduced above the stand taken by him before the Rent Controller and the Small Cause Court. The plaintiff has always looked upon himself as an ordinary tenant and has paid 50 per cent, increase under the Rent Control Act and prayed not to be evicted on the ground of the peculiar relationship between himself and the present defendant which permitted him to pay rents whenever he had funds and the defendant wanted moneys. In fact the plaintiff himself states in the plaint that he was not aware of his own rights until the idea was put into his head by his legal advisers after a careful study of the terms of the decree: vide para. 8 of the plaint. Therefore, the legal fantasy created by the acute brain of the legal adviser and which seems now to have clouded the understanding of the plaintiff can hardly be described as a proved family arrangement. The family arrangement pleaded is untrue.

19. POINT 2: A correct definition of goodwill, as has been pointed out by Allan in his 'Law relating to Good-will' (Stevens and Sons, Limited); 1889, has been always a matter of considerable difficulty; a difficulty that has been admitted by those Judges who have attempted the task. This has arisen mainly from the fact that it is a thing incapable of a separate existence; its nature varying with the nature of the business to which it is attached; and also from the word being a commercial term used indiscriminately by mercantile men, and frequently without a clear appreciation of what they mean thereby. The subject has been still further complicated by the confounding of the thing itself with the means of transferring it, and with the rights an assignee acquires in order to effect that transfer.

Thus, when a trader has his place of business compulsorily taken from him, and he is unable to obtain another in the neighbourhood, it is the benefit of the good will itself that he loses, and which may be of much greater value to him than it would possibly have been to any other, inasmuch as it might have happened that no part was capable of transfer to another; -- 'Cooper v. Metropolitan Board of Works', (1883) 25 Ch D 472 (F); --'White v. Commissioners of Public Works', (1870) 22 LT NS 591 (G). Its saleable value might be nil; his loss might be considerable. Then again, the means of transfer are various. In some cases, as, for example, in the case of public-houses, the good will passes solely with the premises: -- 'Llewellyn v. Rutherford', (1875) 10 CP 456 (H); --'Kennedy v. Lee', (1817) 3 Mer 441 (I).

In the case of periodicals it may be transferred with the right to use the old name; while in other cases, such as professional practices, service of introduction, recommendation, and so forth, are necessary on the part of the vendor, if the purchaser is to acquire the old connection: -- 'Bradbury v. Dickens', (1859) 27 Beav 53 (J); -- 'Austen v. Boys', (1858) 2 De G & J 626 (K). These different methods of transfer have given the word two completely distinct meanings, which have arisen in this way. It is evident that in those classes of cases where it may be transferred by means of rights of property -- rights 'in rem' as distinguished from rights in 'personam' -- as, for example, by the conveyance of the old business premises or old firm name, it has a value upon transfer which is capable of being estimated apart altogether from the individual who carries on the business; while in those cases where the business is of a purely personal nature it can only be transferred by the recommendation of the assignor, and by his agreeing not to compete with his assignee.

20. Thus good will may be either incident to premises or stock-in-trade. Sometimes it happens that on the sale or transfer of a business the purchaser leases the old premises for a specified period and then removes his business to another site. On the termination of the lease the question arises whether the goodwill of the business continues to be annexed to the premises or is carried away by the purchaser and lessee along with the stock-in-trade and machinery. The answer will depend on the original terms of sale, as well as, on the nature of the business; 'One or more of the elements going to make up what is called good will may be retained, while others may be parted with, and all or every such elements may be disposed of without express mention. The right way to approach the question ..... is to consider the facts and endeavour to ascertain what rights, if any, were acquired by the purchaser and lessee beyond the mere right and title to the chattels and premises bought and leased': Per Byrne J., in --'Rickerby v. Reay', (1903) 20 RPC 380 (L).

In some cases it may happen that the original good will, if any, was negligible and that the good will of the business at the end of the lease was entirely built up by the lessee: (1903) 20 RPC 380 (L). In deciding what happens to the good will in such cases, the nature of the business will have to be taken into account. Where the good will is incident to the means of production rather than to the place of business as, for instance, a manufacturing business, the good will passes on with plant and stock to the lessee: --'England v. Downs', (1842) 49 ER 829 (M); --'Morris v. Moss', (1855) 25 LJ Ch 194 (N). On the other hand, where the attribute of locality is the predominant feature, as in the business of a hotel or public house, the good will is generally incident to the premises and, consequently, passes to the reversioner: (1875) 10 CP 456 (H). By an express contract it may, however, pass to the lessee. Thus, we have 'Cat good will' (Landlord and Tenant Act, 1927 (17 and 18, Geo. 5, c. 36), Section 4). When considering a tenant's claim for compensation for good will it is not permissible to take into account so-called 'cat' good will, which is part of the good will attributable to the site as distinct from the tenant's own business carried on on the site: -- 'Mullins v. Wessex Motors Ltd', 1947 2 All ER 727 (O). The good will of a solicitor's business cannot adhere to the premise which it was carried: -- 'Stuchbery & Son v. General Accident, Fire & Life Assurance Corporation Ltd.', 1949 2 KB 258 (P).

21. Applying these principles I find that on the facts of this case the good will under consideration is a personal good will and not a local good will. It is quite true that there will always be an element of locality in all cases of good will. But the point for consideration in each case is, having regard to all the circumstances, whether the good will, in question is preeminently personal good will or local good will.

In this case there is every clement showing that the good will claimed is a personal good will. The premises in this case consist of two sets of properties viz., Umpherson Street properties where the actual process of preparing the condiments goes on and secondly the Popham Broadway property where a portion is used as an office. It is nobody's case that the condiments manufactured in Umpherson Street owe anything to the locality for their excellence or wide preference by buyers. These 'articles can be manufactured equally well in any other place and they would command an equally wide sale. The removal of the business from those premises would not in any way affect the sales. There is no particular advantage enjoyed by this locality which would make it pre-eminently suitable for manufacturing condiments. That is why in the arrangement made by Subramania Pillai with his co-parceners he has only taken a lease for five years, without even an option for renewal. The fact that the business is continued there upto date is not due to the impossibility or inexpediency of removing the business but because till the plaintiff purchased this business exclusively it was a joint family business.

During the second Great World War and evacuation the property in Umpherson Street was not exactly a covetable place and in fact portions of the City there became deserted and it is owing to the building shortage which arose after the second Great World War, that this place has become of some importance to the plaintiff because alternative accommodation is not easily available. Then, turning to the Popham Broadway property, the plaintiff has been making use of only the upstairs portion consisting of a small room and the downstairs portion has been let out to other tenants. The terrace above the first floor has been let out for advertisement purposes to strangers. It is nobody's case that the condiments vended by the plaintiff has become connected with this business in the shape of a trademark or representations and advertisements. There is no question of rival establishments and people being prevented from going to this condiments business unless they occupy the old premises. In short, the custom will not in any way be disturbed by any change of premises and there is also equally no question of the plaintiff building up the importance of the premises year by year by honest work and lavish expenditure of money. Therefore, the good will cannot therefore be described as having become attached to the premises.

22. There is also another type of good will which is mentioned under the Landlord and Tenant Act, 1927 (17 & 18, Geo. 5, Clause 36) where a tenant of premises used wholly or partly for carrying on thereat any trade or business may, in certain circumstances, obtain from his landlord compensation for an improvement made by him or his predecessor-in-title, which adds at the end of the tenancy to the letting value of the premises; and also compensation for the good will that, as a result of the carrying on of his trade or business, attaches to the premises and which will at the end of the tenancy enure to the benefit of the landlord. In certain cases also the Act provides for the grant of a new lease to the tenant. In such a case a tenant is entitled at the termination of the tenancy on quitting the holding to compensation from his landlord where he can show that by reason of the carrying on by him or his predecessors-in-title at the premises of a trade or business for a period of not less than five years what is termed 'good will' has become attached to the premises, by reason whereof the premises could be let at a higher rent than they would have realised had no such good will attached thereto.

23. The Act is designed to prevent the landlord at the end of the tenancy from obtaining without payment a benefit created by the tenant, the nature of the benefit being the power of letting the premises at a higher rent as a result of the good will attaching to them.

24. The use by the Act of the term good will has been criticised. It may be doubted whether the term good will in its strict sense is appropriate to be introduced into a case where some improvement of rental value has resulted to the landlord from the carrying on of a business on the premises by a previous tenant: -- 'Charrington & Co. v. Simpson', 1935 AC 325 (Q). It is quite inappropriate to describe as compensation for good will a payment which is a payment in respect of an improved rental value attaching to the premises (Ibid). It would therefore, seem that the meaning of the term must be deduced from, the terms of the statute itself. This type of good will need not detain us further because there is no corresponding provision either under the Transfer of Property Act or under the Rent Control Act or any other piece of legislation. But even in such a case the plaintiff' who is turned out can only claim compensation and not permanency of tenancy.

25. Therefore, tin's is not a case where the good will has become attached to the premises and consequently the further arguments built upon that footing for conferment of permanent tenancy on this plaintiff need not be considered.

26. POINT 3: A life tenancy co-terminous with the extinction of the business which is claimed by the plaintiff is illegal under Sections 10 and 11, T. P. Act and inequitable on the facts of this case. Sections 10 to 17, T. P. Act have been enacted to encourage free alienation and circulation of property. Entire transfers are not vitiated simply because there may happen to be some clauses in the deeds which are repugnant to the free transfer and circulation of property; such restrictive clauses are to be treated as void. So gift of income without providing for the corpus must be taken as gift of the corpus. -- 'Vishram v. Gangaram', AIR 1935 Sind 235 (R). The principle is of universal application and there is nothing in the Hindu or Mahomedan law inconsistent with it and so it applies to Hindus and Mahomedans: --'Sonatun v. Sm. Juggat Sundari', 8 Moo Ind App 66 (S); -- 'Raja Chandra v. Gobind Nath', 11 Beng LR 86 (T); -- 'Jatindra Mohan Tagore v. Ganendra Mohan Tagore', 9 Beng LR 377 (U); -- 'Pudmanund Singh v. Hayes', 28 Cal 720 (V); -- 'Bhairo v. Parmeswari', 7 All 510 (W); -- 'Maharam v. Ajudha', 8 All 452 (X); -- 'Anantha v. Nagamuthir', 4 Mad 202 (Y); -- 'Amiruddaula v. Nateri Srinivasa Charlu', 6 Mad HCR 356 (Z); -- 'Kuldip v. Khetrani', 25 Cal 869 (Z1) and -- 'Muthu Kumara Chetty v. Anthony Udayan', AIR 1915 Mad 296 (Z2). Under Section 10 a condition absolutely restraining a transferee from disposing of the property is void, and the section is wholly silent as to the validity of qualified restraints on alienation. A condition imposing a partial restraint on alienation is not void: -- 'Ratanlal v. Ramanujdas', (Z3). Whether the restraint in a particular case is absolute or partial has to be gathered from the intention of the transferor from the contents of the document -- 'Gomti Singh v. Anari Kuar : AIR1929All492 . Where property was given by father to son under family arrangement with a condition that in respect of a portion of it the son was prohibited from making any alienation during the father's life-time it was held to be not an absolute restraint: -- Tookchand v. Radha Kishan', AIR 1935 Lah 503 (Z5). Section 10 relates only to transfers made by act of parties. It does not apply to sales under the Indian Companies Act, nor to transfers by operation of law along effect 'in invitum' at a sale in execution of a decree: -- 'Nil Madhab v. Narottam Sikdar', 17 Cal 876 (Z6); -- 'In the matter of the West Hopetown Tea Co. Ltd.', 12 All 192 (Z7); -- 'Golak-nath v. Mathura', 20 Cal 273 (Z8). A family arrangement and a compromise of disputed claims are not transfers, and the section does not in terms apply to them: -- 'Rani Mewa Kuwar v. Rani Hulas Kuwar', 1 Ind App 157 (Z9); -- Khunnilal v. Gobinda', 33 All 356 (Z10); -- 'Kapura v. Madsodan Das', AIR 1943 Lah 168 (Z11). But the principle would be applicable where the condition involves an absolute restraint on alienation; -- 'Prithmi Chand v. Sunder Das', AIR 1946 Pesh 12 (Z12). Similarly, the section does not apply to partitions; but restraints clearly offending the rule must be held to be void; 'Muthuraman Chettiar v. Ponnusami', AIR 1915 Mad 1191 (Z13); -- 'T. V. Sangam Ltd. v. Shanmugha Sundaram', AIR 1939 Mad 769 (Z14).

27. Therefore, realizing the limitation which ought to be observed in regard to conditions restraining alienation, the framers of the compromise embodied in the decree, comprising eminent advocates, have imposed only partial restraint viz., an agreement between two co-sharers at a partition restraining alienation for a period of five years in regard to one set of property and ten years in regard to another set of property. On the other hand, if these restraints on alienation have to (be) construed as is now sought to be done viz. permanent tenancy co-terminpus with the extinction of the business, these restraints would certainly be void.

28. Equity has been vainly invoked in this case to clothe with an air of reasonableness an otherwise harsh and unreasonable claim. The plain' tiff's branch and the defendant's branch were co-sharers in respect of family properties consisting of houses and a flourishing business. The defendant took the houses and Subramania Pillai took the business along with his three sons. Then on the death of Subramania Pillai the properties fell into three shares and the plaintiff had one share and the defendant another. This again has been sold in public auction amongst the three sharers and the plaintiff has purchased it. In other words, both sharers have become entitled to specific properties absolutely. When such is the case where is equity in plaintiff who has driven out the defendant from the business, asking to convert as it were the houses into an Inam and for which he be made liable to pay as if it were a quit rent. The defendant's right in the family properties which is absolute is sought to be practically converted into a widow's estate. I am unable to see any equity whatever in regard to this claim, by the plaintiff.

29. In asking for equity the plaintiff comes to court violating the fundamental maxims of equity. He who seeks equity must do equity. The person invoking the assistance of a court of 'equity must himself act fairly. Has the plaintiff acted fairly towards the defendant? The facts of the case show that he has not done so. He who comes into equity must come with clean hands, i.e. clean, clear of any participation in inequitable conduct. He is doing what a litigant will not be permitted to do. A party litigant cannot be permitted to assume inconsistent positions, to play fast and loose, to blow hot and cold, to approbate and reprobate to the detriment of his opponent. This wholesome doctrine applies not only to the successive stages of the same suit but also to suits other than the one in which the position was taken up provided that the subsequent suit grows out of the previous suits and proceedings. See the successive positions of this plaintiff in the previous partition suit and rent control proceedings. -- 'Hementa Kumari v. Prasanna Kumar', : AIR1930Cal32 ; -- 'Chidambara v. Channappa Mannalingappa', : AIR1934Bom329 (Z16); --'Dwejendra Narain v. Jogeshchandra', : AIR1924Cal600 (Z17); -- 'Girish Chandra v. Bipin Behari', AIR 1918 Cal 404 (Z18). See the discussions of equitable estoppel in Hanbury Modern Equity, Sixth Edn., (1952) p. 51 foll. Delay defeats equities or as it is technically expressed, 'Vigilantibas non dormientibus aequitas subvenit', i.e. equity will not assist those who will slumber over their rights. No aid is rendered to stale demands, Look at from any point of view and the claim of the plaintiff is undoubtedly a stale demand.

30. POINT 4: It is no doubt true that the contention of the plaintiff in regard to the Rent Control Act receives support from a decision of Subba Rao J. in -- 'Parthasarathy v. Krishnamoorthy AIR 1949 Mad 387 (Z19). This decision has however been reversed by Horwill and Rajagopalan JJ. in -- 'Krishnamurthy v. Parthasarathy' AIR 1949 Mad 780 (Z20). This decision has stood the test of time and the Supreme Court has not yet reversed it. It will be sufficient time for us to reconsider the position as and when the plaintiff gets this Bench decision reversed in the Supreme Court and which is certainly binding upon me sitting as a single Judge.

31. POINT 5: The various Acts, etc., relating to the control of accommodation in urban areas which are in force in different States in India are all instances of legislation affecting more or less the right to hold and dispose of property under Clause (1)(f) of Article 19 of the Constitution of India. But such provisions are obviously necessary in public interest in times of shortage of houses. Hence, in so far as such restrictions are not unreasonable, they will be upheld by the Court as being valid. Some of the decisions relating to Rent Control Acts and their being upheld as valid are collected in the characteristically exhaustive and meticulously accurate AIR commentaries on the Constitution of India, Vol. I, pp. 439-440 and are indicated below: -- 'Ramandas v. State of Uttar Pradesh', : AIR1952All703 (FB) (221): U. P. (Temporary) Control and Eviction Act 3 of 1947. Section 7 of the Act does not in any way interfere with the Fundamental Right of a citizen under Article 19(1)(f) of the Constitution, in any case, where the allotment officer after taking into consideration the respective claims of the landlord and other claimants passes an order alloting the vacant premises to one of the claimants on the ground that his need for accommodation was greater than that of the landlord, it cannot be said that the order in any way imposes an unreasonable restriction on the rights of the landlord. 'Iswari Prosad v. N. R. Sen', : AIR1952Cal273 (Z22): The Rent Acts in West Bengal were enacted to meet the grave housing shortage caused by the last Great War and the congestion particularly in the cities and towns of West Bengal caused by the War and the partition of the province in 1947. It may be that the margin of pro-fits allowed to the landlord by the Rent Act of 1950 is small but that would not of necessity Wake the Act 'ultra vires' as being an unreasonable restriction on the landlord's rights. In the interests of law and order and good government restrictions on the landlord's rights were absolutely necessary. It cannot possibly be said that in the circumstances existing when these Acts were passed, the restrictions imposed by the Acts generally were unreasonable, more than were necessary in the interests of the general public. -- 'Shibaram v. Subodh Kumar', : AIR1952Cal533 (SB) (Z23). West Bengal Premises Rent Control (Temporary Provisions) Act 38 of 1948, (Section 1) and West Bengal Premises Rent Control (Temporary Provisions) Act 17 of 1950 (Section 1) are not void of the Constitution. : AIR1952Cal273 (FB) (Z22) followed. -- 'Ram Katori v. Rent Control & Eviction Officer, Agra', : AIR1953All543 (Z24): U. P. Rent Control and Eviction Act 3 of 1951 is not inconsistent with the provisions of Article 19(1)(f) of the Constitution and is not void: : AIR1952All703 (Z21) followed. 'Prem Shankar v. U. P. Provincial Co-operative Bank Ltd.', : AIR1953All51 (Z25): U. P. (Temporary) Control of Rent and Eviction Act 3 of 1947, Section 7(1)(a): The owner's right to hold and dispose of the property is restricted by the provisions of Section 7(1)(a) authorising the District Magistrate to ask the landlord to let or not to let the accommodation to any person. But the restriction imposed is a reasonable restriction on the exercise of the right to hold and dispose of property. 'Dr. K. C. Nambiar v. State of Madras', : AIR1953Mad351 (Z26): Power of Government under Rent Control Act to exempt certain property from the Act is not unreasonable restriction on the right of the tenant who is in possession. 'Karam Chand Thapar & Bros. Ltd. v. Dr. Anand', : AIR1952All699 (Z27): U. P. (Temporary) Control of Rent and Eviction Act 3 of 1947 as amended in 1948, Section 3 -- Validity -- Unfettered discretion given to District Magistrate to grant permission for eviction. Suit does not render Section 3 bad. Ram Krishna v. Radhamal', : AIR1952All697 , (Z28): United Provinces (Temporary) Control of Rent and Eviction Act, 1947, is not a permanent Act. It is only a temporary measure enacted in order to tide over certain difficulties arising out of the scarcity of accommodation which, it is common knowledge, still exists. The restrictions placed by the Act upon the exercise of the Fundamental Rights of a citizen are riot of a nature which can be described as unreasonable and hence the Act is not void under Article 13 of the Constitution as contravening Fundamental Rights under Article 19(1)(f). Jeewan Ram v. United State of Rajasthan', (Z29): Rajasthan Premises (Requisition and Eviction) Ordinance 11 of 1949 is valid, because it only places reasonable restrictions on the right to acquire, hold or dispose of property in the interest of the general public,

In the result, the Madras Buildings (Lease and Rent Control) Act is certainly 'intra vires' of the Constitution of India.

32. I, therefore, find issue 1 in the negative that the suit premises have not become part of the good will of the business; issue 2 in the negative and against the plaintiff; issue 3 in the negative and against the plaintiff; that the family arrangement pleaded is untrue; under issue 4 that the agreement pleaded is untrue and has no legal effect; issue 5 in the negative that the order of eviction is not a fraud on the plaintiff's rights as alleged; issue 6 in the negative that the plaintiff is a bare tenant of the suit premises; issues 7 and 8 in the negative that the provisions of the Rent Control Act at variance with the Transfer of Property Act are not illegal and are enforceable; issue 9 in the negative that the owner of P. Vencatachellum business is not entitled to the use and occupation of the suit premises on payment of reasonable rent to the defendant as claimed in the plaint; and issue 10 in the negative that the plaintiff is not entitled to the declaration and injunction asked for.

33. In regard to issue 11 the parties have come to the following arrangement which is embodied in the following contemporaneous note made by me on 23-4-1954:

'The Broadway building will be vacated and handed over by the plaintiff to the defendant. The plaintiff will continue to occupy Nos. 5, 6 and 7, Umpherson Street and will pay a rent of Rs. 500/- per month. He will pay advance rental for three months. The first letting will be for a period of five years and at the expiry of the first five years there will be, option given to the laintiff to renew the lease subject of course to such adjustments of rent as the then prevailing market rate of rent will dictate. Plaintiff will pay the costs of suit to defendant. It is noted that the downstairs portion of the Broadway building is occupied by a tenant and proceedings against him before the Rent Controller are pending. The plaintiff will direct that tenant to attorn to the defendant arid will give vacant possession of the upstairs portion. In the judgment provision will be made regarding the withdrawal of the suit pending in the City Civil Court.'

34. The suit is decreed in the above terms and will stand allowed and disallowed to the above extents. Suit decreed.


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