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A.R. Cunniah Naidu Vs. Thirunavukkarasu Chettiar and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai High Court
Decided On
Reported in(1960)2MLJ7
AppellantA.R. Cunniah Naidu
RespondentThirunavukkarasu Chettiar and ors.
Cases ReferredIn Seethalakshmi Ammal v. Judge
Excerpt:
.....carrying on may well apply to cases arising under section 7(3)(a)(iii) of the act also. 10. what one has to consider in a case like the present one is as to whether the petitioner is in substance entitled to possession of any building which he was occupying for the purpose of his own business......was being carried on until the date of dissolution belonged to s.k.p.d. charities, and when the partnership business was transferred from bunder street to the premises of the said charities, the lease-hold interest which the present petitioner had in the premises in kotwal bazaar belonging to the s.k.p.d. charities became the property of the partnership that was being carried on. that is to say, the leasehold interest became by agreement part of the assets of the partnership business. but when the dissolution came up, this leasehold interest continued to be an asset of the partnership business from which the petitioner retired. by reason of his retirement, he ceased to have any more interest in the lease of the premises, where the partnership was being carried on, even after the.....
Judgment:

1. This Civil Revision Petition is against the order of the learned Second Judge of the Court of Small Causes in H.R.A. No. 174 of 1956 against H.R.C. No. 2763 of 1955. The landlord who sought to evict his tenant is the petitioner in this Civil Revision Petition.

2. The petitioner's case was that he had been running a business in partnership with two or three others for over 40 years, orginally at No. 33, Bunder Street and later on at Nos. 32, 34, 35, 68, 71, 104 and 105 in Kotwal Bazaar. On account of differences between the partners of the firm, which was known as A.R. & Sons and A.R. Kanniah Naidu at Kotwal Bazaar, the partnership had to be dissolved, by a deed of dissolution, dated 29th April, 1955. The premises where this partnership was being carried on until the date of dissolution belonged to S.K.P.D. Charities, and when the partnership business was transferred from Bunder Street to the premises of the said charities, the lease-hold interest which the present petitioner had in the premises in Kotwal Bazaar belonging to the S.K.P.D. Charities became the property of the partnership that was being carried on. That is to say, the leasehold interest became by agreement part of the assets of the partnership business. But when the dissolution came up, this leasehold interest continued to be an asset of the partnership business from which the petitioner retired. By reason of his retirement, he ceased to have any more interest in the lease of the premises, where the partnership was being carried on, even after the dissolution of the partnership. In and by the terms of the deed of dissolution, however, this petitioner was allowed, as a temporary measure, for a period of one year, to have his retail business in a portion of the premises, in which the partnership itself was carried on, in his capacity as a licensee and not as being entitled any more to the lease-hold interest which had become transferred in favour of the partnership business. It is also the case of the petitioner that he desired to carry on a wholesale business in plantains instead of the retail business, which he was forced to carry on after the dissolution of partnership.

3. On 10th December, 1954, this petitioner had purchased premises No. 54, Bunder Street for a sum of about Rs. 55,000. This premises was in the occupation of the present respondents. With a view to ply his own business in the premises purchased by him the petitioner filed an application for eviction of the respondents tenants on the ground that the premises was required for his own use, and that he had no other premises in which he could carry on his wholesale business. Nor was he entitled to possession of any other premises at the time he filed the application for eviction of the respondents.

4. This application before the Rent Controller was enquired into and dismissed on the ground that the petitioner in order to avoid the inconveniences of the provisions of Section 7(3)(a)(iii) of the Act had conveniently given up his right to the possession of the shops in Kotwal Bazaar, the tenancy of which was still in his name and to the possession of which he was still entitled, in favour of the partnership firm and had made himself a licensee in a portion of the premises for a limited period. The learned Rent Controller also observed that the S.K.P.D. Charities had not recognised the change of tenancy from the personal name of the petitioner to the name of the partnership firm, A.R. & Sons, that the petitioner alone continued to be in possession of the said shops, that the possession of those shops could not be transferred to the firm, and that the petitioner had not even informed the S.K.P.D. Charities about the intended change, much less has the S.K.P.D. taken any action against him for eviction from those shops. Therefore the learned Rent Controller found that the petitioner, who was occupying for the purpose of a business which he was carrying on, non-residential buildings in the city, to the possession of which he was entitled under the Act, was not entitled to possession of the same under Section 7(3)(a)(iii) of the Act. In the result the Rent Controller, as already stated, dismissed the petition.

5. The petitioner thereupon preferred an appeal before the learned Second Judge of the Small Causes Court. The learned Judge of the Court framed two points for his consideration. The first one was whether the claim of the appellant was bona fide, and the second was whether he was not entitled to evict the respondents under Section 7(3)(a)(iii) of the Act. The learned Small Cause Judge agreeing with the Rent Controller on the first point held that the claim of the appellant was bona fide, but opined that that point did not arise before him for consideration. The only point which arose before him for consideration was whether the petitioner was entitled to evict the respondents from the premises purchased by him and now required by him for the purpose of carrying on his wholesale business. On this point the learned Second Judge of the Small Causes Court, however, agreed with the Rent Controller and he accordingly dismissed the appeal. He held that the appellant was occupying, for the purpose of his business which he was carrying on, a non-residential building to the possession of which he was entitled under the Act, and therefore the petitioner was not entitled to an order directing the respondents-tenants occupying the non-residential building in question to put him in possession of the same under Section 7(3)(a)(iii) of the Act. While dismissing the appeal the learned Second Judge also observed that there was no evidence before the Rent Controller to warrant his conclusion that Exhibit P-I, the deed of dissolution had been brought into existence to avoid inconveniences of the provisions of Section 7(3)(a)(iii) of the Act, and he held further that the dissolution of the partnership was not his own unilateral act and it came along after Exhibit R-2 series. Aggrieved against this order the petitioner has preferred this Civil Revision Petition.

6. The simple point that arises for consideration before me is whether in the eye of the law, the petitioner could be said to be still entitled to possession of a non-residential building in the city, town or village concerned, which is his own or to the possession of which he is entitled, whether under this Act or otherwise. That is to say whether the petitioner satisfies the conditions stipulated in Section 7(3)(a)(iii). Section 7(3)(a)(iii) provides that a landlord, may subject to the provisions of clause (d) apply to the Controller for an order directing the tenant to put the landlord in possession of the building, in case it is any other non-residential building, if the landlord is not occupying for purposes of a business which he is carrying on, a non-residential building in the city, town or village concerned which is his own or to the possession of which he is entitled whether under this Act or otherwise. The evidence in this case is clearly to the effect that until the date of dissolution of the partnership evidenced by Exhibit P-1 in the case, the petitioner was occupying for the purpose of his own business a non-residential building in the city, to the possession of which he was entitled under a lease which he held from the S.K.P.D. Charities. It is also in evidence that the rent for this building was being paid by the partnership, until the dissolution of the partnership, though the lease stood in the name of the petitioner. It is also in evidence that after the dissolution of the partnership, no change has been made in the name of the person who is said to be the tenant in respect of the premises in which the partnership was still being carried on by the rest of the partners. As observed by both the Courts below, though the S.K.P.D. Charities have been receiving the rent for the premises from the partnership business, still they have not taken any steps to have the tenancy agreement executed by the partnership which is actually in the enjoyment of the premises, since the date of the dissolution to the exclusion of the petitioner. It is not disputed that after the date of the dissolution, the petitioner has lost his right to the leasehold interest in the premises where the partnership was being carried on, he having got out of the partnership and having taken just a portion of the premises as a licensee for a temporary period. It is conceded on both sides that after the dissolution of the partnership, the petitioner was carrying on only a retail business. According to the petitioner, the purpose of his having purchased the property in question was to carry on a wholesale business, and that it was also his intention to carry on such wholesale business in premises belonging to himself. There is at any rate no evidence contra. It was in those circumstances that he put in his application before the Rent Controller for evicting the tenants from the premises purchased by him in December, 1954. The question then to be considered is whether notwithstanding the fact that the tenancy in respect of the premises where the partnership business is carried on remained in his name nominally, and despite the fact that the petitioner had gone out of possession of those premises by virtue of the terms of the deed of dissolution and also the fact that he had continued in a part of the premises as a mere licensee for a period of one year, he could still be considered to be entitled to possession of the premises where he was carrying on business. The ?correct answer to this question would indeed decide the issue in this case.

7. The learned Counsel appearing on behalf of the petitioner has contended that when once the dissolution had taken place and as has been held by the Court below that there was no lack of bona fides in the dissolution and when once by virtue of the terms of the dissolution the tenancy interest in the premises had been made over to the rest of the partnership, who were still carrying on business in the premises, and the petitioner himself having gone out of the premises by virtue of the very terms of the deed of dissolution, it cannot be said that the petitioner was any more entitled to possession of the premises under the Act or otherwise. He further argued there was nothing inherently wrong, nor was it incompetent on the part of the petitioner to have entered into the dissolution of partnership under which he could make over the right to the tenancy in favour of the rest of the partners of the dissolved firm to the exclusion of himself. Such a transfer of right to a tenancy in favour of a partnership by one of the partners, when that tenancy had become one of the assets of the partnership by reason of the conduct of the parties to the partnership, has been recognised to be a valid act on the part of the out-going partner and no impropriety or illegality could be attached to the transfer of interest made by the out-going partner.

8. The decision in Devarajulu Naidu v. Ethirajavalli Thayaramma : (1949)2MLJ423 , has been cited by the learned Counsel for the petitioner in support of this contention. In so far as the dissolution of the partnership has not been brought about with a view to evade the consequences of Section 7(3)(a)(iii), but has been bona fide and as a result of that deed of dissolution the petitioner has lost his right to possession of the premises where the rest of the partners are still carrying on business to his exclusion, it is difficult to hold that the petitioner is still entitled to possession of those premises. It may be that even though he has lost possession of the premises where he as one of the partners was hitherto carrying on business the receipts were still being issued in his name, notwithstanding the fact that he had ceased to have any more right to possession of that property, and it may be also that there has been no change in the reeords of the S.K.P.D. Charities. Still the fact that he is no more entitled to possession of the premises which he has ceased to occupy and had allowed the rest of the partners to continue in occupation to his exclusion, cannot be seriously disputed. If he attempts to get back possession of the premises in the exercise of any claim of right to possession, surely he will not succeed, and in the face of the terms of the deed of dissolution his claim any more to the possession of the property in which he was carrying on business until the date of dissolution, would not be upheld by any Court. He would easily be non-suited by reason of his having entered into the deed of dissolution, whereby he had given up his right to the possession of the premises where he was hitherto carrying on business as one of the partners of the firm which now continues to be in possession of the property. Therefore it cannot be argued with any justification that the petitioner is still entitled to possession of the premises where he was once carrying on business. If that is the actual situation, then he will certainly come within the scope of Section 7(3)(a)(iii) and will be entitled to possession of the premises which is now under the occupation of the respondents, since the petitioner wants those premises for carrying on his business. The next question is whether it has been established that the petitioner actually wants the premises which is in the occupation of the respondents for his own business. On the facts of the case there can be little doubt that the petitioner, who is a plantain merchant and who has been a partner of a bigger firm does require the premises-purchased by him for his own wholesale business. The location of the premises in an area where the premises are will be suited for non-residential purposes. The fact also is indisputable that when he filed the application for eviction of the respondents he was occupying a portion of the previous premises only as a licensee and that too for a temporary period and on the lapse of that temporary period he will be without any premises of his own for carrying on his business. Even the ground that he wanted to expand his business from being a retail one into a wholesale one would also be a justification for his requiring his premises from the tenants.. The decision in Narayana Rao v. Mt. R.D. Swame A.I.R. 1953 Nag. 271, has been cited by the learned Counsel for the petitioner in support of his contention that where a petitioner does; need a premises for carrying on the business, it follows that his need was a genuine one. In that decision it was however observed that it may be that he wanted to expand his business to earn more money or that he wanted to free himself from the shackles of the Rent Control Order. Even so, what he wants is within the law and as such he is, when he made the application, entitled to have the premises vacated.. The principle of this decision would apply to the present case. As already observed, there is no justification for refusing the petitioner the use of his own premises when he is in dire necessity, not merely for his carrying on his own business, but also for the expansion of his business, particularly when he had lost possession of the premises in which he was hitherto carrying on business by virtue of the terms and conditions of the deed of dissolution referred to above.

9. In Nagamanickam Chettiar v. Nallakanna Servai (1957) 1 M.L.J. 182, the learned Chief Justice of this Court has held that the principle of Section 7(3)(c) of the Madras Buildings (Lease and Rent Control) Act which provides for a landlord requiring additional accommodation for the purpose of a business he is carrying on may well apply to cases arising under Section 7(3)(a)(iii) of the Act also. He has. held further that where a landlord who is carrying on business in camphor in a rented building requires his own building for installing a power-driven machinery for manufacturing camphor, which could not be done in the rented building, even though there may be no threat of eviction from the rented building and there is no question of additional accommodation it is a case of a landlord requiring accommodation necessary for carrying on his business with the aid of power-driven machinery and he is entitled to maintain an application for eviction of the tenant. The principle of that decision will also apply to the facts of the present case.

10. What one has to consider in a case like the present one is as to whether the petitioner is in substance entitled to possession of any building which he was occupying for the purpose of his own business. The mere fact that the landlord had not been informed of the changed situation in which the petitioner lost his right to possession and had become disentitled to possession would not really make any great difference, if by any legitimate act of his he had become no more entitled to possession of the building in which he was carrying on a business hitherto.

11. In Seethalakshmi Ammal v. Judge, Court of Small Causes, Madras (1950) 1 M.L.J. 17, the Honourable the Chief Justice and Somasundaram, J. have observed that the material provision of the Madras Rent Control Act does not require the landlord to establish more than that he requires the house for his own occupation and that he is not occupying a residential building of his own in the city, town or village concerned. No doubt he has to satisfy the Controller that his claim is bona fide. But the fact that a person is not urgently in need of a house cannot lead to the conclusion in law that his claim for eviction is not bcna fide. A purchaser of a house applying for eviction of the tenant is not required to establish that he was driven to the necessity of purchasing the house and that he was urgently in need of the same. This decision also is authority for the proposition that has been advanced by the learned Counsel for the petitioner in this case.

12. Therefore, considering the entire circumstances of the case, I am of the view that it cannot be contended any more on the facts of the present case that the petitioner is not entitled to the possession of his house for the purpose of carrying on his business in plantains and for that purpose he was not entitled to ask for a direction that the tenants in the premises purchased by him and which premises are required by him for his business should be evicted and the buildings placed in his possession

13. In this view, the orders of both the Courts below cannot be sustained and they are hereby set aside. This Civil Revision Petition is allowed. There will be a direction that the tenants of premises No. 54, Bunder Street, do deliver vacant possession of the premises to the petitioner by the first of December this year. No costs.


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