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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 23RD DAY OF MAY, 2023
BEFORE
THE HON’BLE MR. JUSTICE R.NATARAJ
HOUSE RENT REVISION PETITION NO.56 OF 2017
BETWEEN:
M/S MAHENDRA WATCH COMPANY A PARTNERSHIP FIRM, REPRESENTED BY ITS PARTNERS MR. RAJESH KUMAR, S/O SHANTHILALJI, SHOP NO.1, GROUND FLOOR, MARUTHI PLAZA, U.M. LANE, BLOCK-C, CHICKPET, BENGALURU-560053 (THE PRESENT PARTNERS OF THE FIRM ARE SRI ASHISH M. JAIN AND ATUL JAIN)
SRI. ASHISH M. JAIN S/O SRI MOHANLALJI, AGED ABOUT 38 YEARS, PARTNER, M/S MAHENDRA WATCH COMPANY, SHOP NO.1, GROUND FLOOR, MARUTHI PLAZA, U.M. LANE, BLOCK-C, CHICKPET, BENGALURU-560053
SRI. ATUL JAIN S/O SRI. MOHANLALJI, AGED ABOUT 40 YEARS, PARTNER, M/S MAHENDRA WATCH COMPANY, SHOP NO.1, GROUND FLOOR, MARUTHI PLAZA, U.M. LANE, BLOCK-C, CHICKPET, BENGALURU-560053. ...PETITIONERS (BY SRI. PARAS JAIN, ADVOCATE)
AND:
SRI. M.V.RAMACHANDRASA SINCE DECEASED REP. BY LEGAL HEIRS
1(a) SMT. SHANTA BAI W/O LATE SRI RAMACHANDRASA, AGED ABOUT 82 YEARS, RESIDING AT NO.11, O.T.C. ROAD, FIRST CROSS, BANGALORE-560053.
1(b) SRI. M.R.GOVERDHAN S/O LATE SRI. RAMACHANDRASA, AGED ABOUT 69 YEARS, RESIDING AT NO.11, O.T.C. ROAD, FIRST CROSS, BANGALORE-560053.
1(c) SRI. M.R.LAKSHMIKANTH RAJ S/O LATE SRI. RAMACHANDRASA, AGED ABOUT 64 YEARS, RESIDING AT NO.9 AND 10, O.T.C. ROAD, FIRST CROSS, BANGALORE-560053.
1(d) SRI. M.R.RAGHAVENDRA S/O LATE SRI. RAMACHANDRASA, AGED ABOUT 60 YEARS, RESIDING AT NO.11, O.T.C. ROAD, FIRST CROSS, BANGALORE-560053.
1(e) SRI. M.R.SURENDRA S/O LATE SRI. RAMACHANDRASA, AGED ABOUT 58 YEARS, RESIDING AT NO.9 AND 10, O.T.C. ROAD, FIRST CROSS, BANGALORE-560053.
1(f) SRI. M.R.AMARNATH S/O LATE SRI. RAMACHANDRASA, AGED ABOUT 56 YEARS, RESIDING AT NO.09 AND 10, O.T.C. ROAD, FIRST CROSS, BANGALORE-560053.
SRI. RAJESH KUMAR S/O SRI. SHANTHILALJI, C/O M/S MAHENDRA WATCH COMPANY, SHOP NO.1, GROUND FLOOR, MARUTHI PLAZA, U.M. LANE, BLOCK-C, CHICKPET, BENGALURU-560053 …RESPONDENTS (BY SRI. H.S.SOMNATH, ADVOCATE FOR RESPONDENT NO.1(a) TO 1(f); VIDE ORDER DATED 10.11.2021, SERVICE OF NOTICE TO RESPONDENT NO.2 IS HELD SUFFICIENT)
THIS HRRP IS FILED UNDER SECTION 46(1) OF KARNATAKA RENT ACT OF 1999, AGAINST THE ORDER DATED 14.07.2017 PASSED IN HRC.NO.63/2016 ON THE FILE OF THE CHIEF JUDGE, COURT OF SMALL CAUSES AT BANGALORE (SCCH-1), ALLOWING THE PETITION FILED UNDER SECTION 27(2)(b)(ii) AND 27(2)(p) OF KARNATAKA RENT ACT 1999.
THIS PETITION HAVING BEEN HEARD AND RESERVED FOR ORDER ON 24.03.2023 AND COMING ON FOR PRONOUNCEMENT OF ORDER THROUGH VIDEO CONFERENCE THIS DAY, THE COURT MADE THE FOLLOWING:-
ORDER
This revision petition is filed challenging an order dated 14.07.2017 passed by the Chief Judge, Court of Small Causes at Bengaluru (henceforth referred to as 'Trial Court' for short) in H.R.C.No.63/2016 by which, the petitioners herein were ordered to be evicted from the petition schedule premises under Sections 27(2)(b)(ii) and 27(2)(p) of the Karnataka Rent Act, 1999.
The parties shall henceforth be referred to as tenants and the landlord. The petitioners were the tenants, while the respondent No.1 (since deceased) was the landlord of a commercial premises.
An eviction petition was filed under Sections 27(b)(ii), 27(d)(i)(ii) and 27(p) of the Karnataka Rent Act, 1999, contending that the landlord held leasehold rights for 55 years in terms of a lease deed dated 02.02.1983, in respect of the immovable property bearing Municipal New Nos.22 to 33, situate at Uttaradi Mutt Lane, Chickpet, Bengaluru – 560 053. The landlord claimed that he was
authorised to sub-lease any or all portions of the aforesaid properties and accordingly, had leased the petition schedule property measuring 9' x 10' 7" to the tenant namely, M/s Mahendra Watch Company in terms of a lease deed dated 22.02.1985 on a monthly rent of Rs.85/-. The said M/s Mahendra Watch Company was a partnership firm represented by its partner namely, Mr. Rajesh Kumar. It was contended that as per the lease deed dated 22.02.1985, Mr. Rajesh Kumar was specifically restrained from sub-letting the petition premises to any third parties without the consent of the landlord in writing. The said Mr. Rajesh Kumar was also restrained from transferring the partnership firm without the consent of the landlord. The landlord alleged that Mr. Rajesh Kumar was not in occupation and possession of the petition property for nearly three years and none of his family members were in occupation of the petition premises. Instead, Mr. Ashish M. Jain and Mr. Atul M. Jain, being absolute strangers, were in illegal and unlawful possession of the petition premises. The landlord claimed that Mr. Ashish M. Jain
and Mr. Atul M. Jain were not tenants. Consequently, he claimed that Mr. Rajesh Kumar had sub-leased the petition premises to Mr. Ashish M. Jain and Mr. Atul M. Jain, in violation of the terms and conditions of the lease deed dated 22.02.1985. The landlord claimed that these facts were ascertained on the basis of a information furnished by the Commercial Tax Officer, who had issued TIN No.29490306602 in favour of Mr. Ashish M. Jain and Mr. Atul M. Jain. The landlord claimed that he never admitted or acknowledged Mr. Ashish M. Jain and Mr. Atul M. Jain as the tenants in the petition premises. He claimed that the said Jain brothers in terms of their letter dated 05.02.2014 had claimed that they had become tenants under the landlord and tried to pay the rents by way of a cheque for a sum of Rs.14,916/-. The landlord did not encash the cheque and refused to accept the rent from the said Mr. Ashish M. Jain and Mr. Atul M. Jain. The landlord thereafter issued a notice dated 24.08.2015 to Mr. Rajesh Kumar and sought an explanation as to who was occupying the petition premises and as to who were the partners of M/s
Mahendra Watch Company. This notice was not served on the said Mr. Rajesh Kumar. Later, the landlord called upon Mr. Ashish M. Jain and Mr. Atul M. Jain by a notice dated 08.09.2015 as to what was their role in M/s Mahendra Watch Company. The landlord claimed that though this notice was served, Mr. Ashish M. Jain and Mr. Atul M. Jain failed to furnish any information. However, they issued a reply dated 16.09.2015 contending that the petition premises was leased to them and that they were in occupation of the premises from the date of the lease and were carrying on business. They also enclosed a cheque for a sum of Rs.26,503/- dated 16.09.2015. The landlord did not encash the cheque and did not accept Mr. Ashish M. Jain and Mr. Atul M. Jain as the tenants. Consequently, the landlord terminated the tenancy of M/s. Mahendra Watch Company and called upon it, Mr. Rajesh Kumar and Mr. Ashish M. Jain and Mr. Atul M. Jain to quit and deliver vacant possession of the petition premises. After receipt of the notice, Mr. Ashish M. Jain and Mr. Atul M. Jain issued a reply dated 26.02.2016 and refused to handover vacant
possession. In view of the same, the landlord filed a petition for eviction of the tenants and sub-tenants.
This petition was opposed by M/s Mahendra Watch Company, Mr. Atul M. Jain and Mr. Ashish M. Jain. Mr. Ashish M. Jain and Mr. Atul M. Jain claimed that their father Mr. Mohanlal D. Jain was carrying on business along with Mr. Shanthilal, Mr. Mahendra Kumar, Mr. Ashish M. Kumar as partners of M/s Mahendra Watch Company. In course of time, Mr. Shanthilal and Mr. Mohanlal retired and Mr. Ashish M. Jain and Mr. Atul M. Jain were carrying on business. They claimed that when the landlord took the premises on long lease in the year 1983, they were already in possession of Shop No.26. After the landlord took on lease, he got the old building demolished and constructed a new building and named it as "Maruti Plaza", where there were 164 shops. While delivering possession to the tenants who were earlier in occupation, a smaller shop area was given to them. Thus, Mr. Ashish M. Jain and Mr. Atul M. Jain were placed in possession of 95 sq. ft.
of shop premises in terms of a lease dated 22.02.1985 on a monthly rent of Rs.85/- and the period of lease was 53 years from 22.02.1985. They alleged that landlord was demanding enhanced rents from all the tenants in occupation. They further contended that Mr. Rajesh Kumar was entitled to retire from the firm and that they were entitled to continue the firm and hence, there was no sub- letting as alleged and consequently prayed to dismiss the petition.
The son of the landlord, who held a power of attorney was examined as PW.1, who reiterated the averments of the petition and marked Exs.P1 to P24. Mr. Mohanlal D. Jain, being the power of attorney of M/s. Mahendra Watch Company was examined as RW.1 and he marked Exs.R1 to R40. A tenant in Maruti Plaza was examined as RW.2, while a businessman carrying on business in a premises opposite to Maruti Plaza was examined as RW.3 and a businessman carrying on business in a premises adjacent to Maruti Plaza was
examined as RW.4, while another businessman carrying business opposite to Maruti Plaza was examined as RW.5.
Based on the pleadings of the parties and the oral and documentary evidence, the Trial Court ordered eviction of M/s Mahendra Watch Company, Mr. Ashish M. Jain and Mr. Atul M. Jain in terms of the order dated 14.07.2017 on the following grounds:- (i) that Mr. Ashish M. Jain and Mr. Atul M. Jain did not produce any document to establish that they were the partners of M/s Mahendra Watch Company and the documents relied upon by them did not create any right in their favour to remain in possession of the petition premises. (ii) that Mr. Ashish M. Jain and Mr. Atul M. Jain were sub-let into the premises by Mr. Rajesh Kumar without obtaining any permission from the landlord.
(iii) that the contention of Mr. Ashish M. Jain and Mr. Atul M. Jain that after the retirement of Shanthilal and Mahendra Kumar as partners of M/s Mahendra Watch
Company, their father Mr. Mohanlal D. Jain and Mr. Ashish M. Jain continued as partners was not substantiated. (iv) that Mr. Ashish M. Jain and Mr. Atul M. Jain failed to place on record the partnership deed dated 01.07.2000, which was referred in Ex.R3. It held that Ex.R3 was a document dated 01.07.2000 drawn on a stamp paper issued by the treasury on 21.04.2000 but was sold by the stamp vendor on 05.03.2000. It therefore, held that Ex.R3 was one brought about in suspicious circumstance. (v) that the document at Ex.R3 was not entered into between the partner Mr. Rajesh Kumar and that there was no document to establish that the father of Mr. Ashish M. Jain and Mr. Atul Jain namely, Mr. Mohanlal D. Jain was also a partner of the firm. Therefore, the occupation of the premises by Mr. Ashish M. Jain and Mr. Atul Jain was a clear case of sub-letting the premises.
Being aggrieved by the aforesaid order, M/s Mahendra Watch Company, Mr. Ashish M. Jain and Mr. Atul Jain have filed this revision petition.
The learned counsel for the petitioners/tenants submitted that a partnership is a legal entity and is represented by its partners. Therefore, a mere change in the partners does not result in changing the relationship vis-à-vis the landlord. He submitted that the Karnataka Rent Act, 1999 came into force with effect from 31.12.2001 and Mr. Mohanlal D. Jain and Mr. Ashish M. Jain were carrying on the business in the petition premises prior to 31.12.2001. Thus, in view of Section 32 of the Karnataka Rent Act, 1999, even if the consent of the landlord was not obtained and even if it is construed that the premises were sub-let, it shall be deemed to have been lawfully sub-let. He contends that as per the lease deed dated 22.02.1985, the term of lease was 53 years and is to expire on 22.03.2038 and therefore, the petition for eviction is not maintainable. The learned counsel
invited the attention of the Court to the rent receipts as per Ex.R2 and contends that the rent was paid continuously till the year 2008 and the same was reflected in the return of income for the year 2001-02. He also invited the attention of the Court to Ex.R5 which is a deed of admission-cum-retirement of Mr. Ashish M. Jain, Mr. Atul M. Jain and Mr. Mohanlal D. Jain, by which Mr. Mohanlal M. Jain retired from the firm. He contended that the fact that the original lease deed dated 22.02.1985 executed by the landlord was in possession of Mr. Ashish M. Jain and Mr. Atul M. Jain which was marked as Ex.R9 indicated that the firm was continued by Mr. Mohanlal D. Jain and later by his sons and therefore, a case for sub- letting was not made out.
Per contra, the learned counsel for the landlord submitted that in terms of the lease agreement dated 22.02.1985 (Ex.P4), M/s Mahendra Watch Company was a tenant under Srimad Jagadguru Madhwacharya Moola Mahasamsthana, Uttaradi Mutt and it had attorned the
tenancy in favour of the landlord herein. Just prior to the landlord taking the premises on long lease from Srimad Jagadguru Madhwacharya Moola Mahasamsthana, Uttaradi Mutt, he was authorised to demolish the existing structure and erect a new shopping complex and the landlord had agreed to reconstruct a building and handover a shop to M/s Mahendra Watch Company. Till such time, M/s Mahendra Watch Company was accommodated in a shop bearing No.26 Bathing Ghat lane.
After such reconstruction, the shop to be leased out to M/s Mahendra Watch Company was identified as Shop No.19. He submitted that when the aforesaid lease agreement was executed, the partner of M/s Mahendra Watch Company was Mr. Rajesh Kumar, S/o Shanthilal. However, the information furnished by the department of Sales Tax indicated the partners of M/s Mahendra Watch Company as Mr. Ashish M. Jain and Mr. Atul M. Jain. He submitted that there is no document of whatsoever nature to establish that Mr. Ashish M. Jain and Mr. Atul M. Jain were ever partners of M/s Mahendra Watch Company but yet they
were in possession of the same. He further contended that the deed of retirement of Mr. Shanthilal and Mr. Mahendra Kumar as per Ex.R3 dated 01.07.2000 was suspicious as the date of issuance of the stamp papers by the treasury was 21.04.2000, while the stamp vendor had sold it on 05.03.2000 making it a suspicious document. While the other documents placed on record such as the income tax returns of Mr. Mohanlal D. Jain are brought about in the year 2002-03 and onwards. He also submitted that the deed of retirement dated 01.06.2008 by which, Mr. Mohanlal D. Jain retired from the firm is equally suspicious as no corresponding document to establish that Mr. Mohanlal D. Jain was a partner produced before the Court. Hence, he contended that Mr. Ashish M. Jain and Mr. Atul M. Jain are absolute strangers, who have taken over the business of M/s Mahendra Watch Company without the consent of the landlord and therefore, they are deemed to be sub-lessees in possession of the petition premises. The learned counsel therefore, contended that there is no error committed by the Trial Court in ordering eviction of Mr.
Ashish M. Jain, Mr. Atul M. Jain. He contended that the rent receipts as per Ex.R2 are not proved and therefore, Mr. Ashish M. Jain and Mr. Atul M. Jain are not entitled to continue in possession of the premises.
I have considered submissions made by the learned counsel for the landlord and the learned counsel for the petitioners namely, M/s Mahendra Watch Company, Mr. Atul M. Jain and Mr. Ashish M. Jain. I have also perused the records of the Trial Court as well as its order impugned in the present petition.
The facts, which are not in dispute are that M/s Mahendra Watch Company was a tenant in occupation of a premises and was inducted by Uttaradi Mutt. Later, in terms of Ex.P1 dated 02.02.1983, Uttaradi Mutt had leased the property bearing Nos.22 to 33, Uttaradi Mutt lane (Bathing Ghat road), No.1, 1st lane, Uttaradi Mutt, which was in occupation of tenants, in favour of the landlord herein. The landlord was permitted to demolish the existing structure and construct a commercial complex
thereon and was entitled to sub-lease the entire property for a period co-terminus with the period of lease of 55 years as agreed under Ex.P1. Consequently, the landlord entered into a lease agreement with M/s Mahendra Watch Company on 22.02.1985, wherein it was specifically mentioned that M/s Mahendra Watch Company was a lessee under Uttaradi Mutt. On the instructions of Uttaradi Mutt, M/s Mahendra Watch Company attorned the tenancy in favour of the landlord herein. It was specifically agreed between M/s Mahendra Watch Company and the landlord that the building would be demolished and an alternate accommodation would be provided to the tenants including M/s Mahendra Watch Company and accordingly, was accommodated in a Shop bearing No.14. It was agreed that the landlord would accommodate M/s Mahendra Watch Company in the ground floor facing the Bathing Ghat lane after the building was re-constructed. This lease agreement specifically provided as follows:- "That the Lessee shall not sub-let the schedule premises without the consent of the Lessor in writing
but shall be entitled to carry on the business in partnership with such other person or persons. Further, if the lessee intends to sell the going concern, the lessee shall be entitled to do so with the consent of the Lessor. However, the Lessor shall not be unreasonable in giving the consent to the Lessee in this behalf. The lease of the new premises shall be heritable and transferable among the partners to their heirs."
Ex.R2 series is the rent receipts in respect of the petition premises from the year 1991 to 2008, which are admitted by PW.1 in the following words:- "The witness is confronted with Xerox copies of rent receipts saying that those receipts are issued by your family members in favour of Mahendra Watch Company and witness admits the same and hence the same are marked as Ex.R2 series."
PW.1 did not know the partners of M/s Mahendra Watch Company, as he deposed as follows:- "It is true the Mahendra Watch Company is a partnership firm. Rajesh Kumar Jain is the partner along with the Mahendra Watch
Company and though they are told that they are going to furnish the partnership deed but they have not furnished and hence, I cannot tell the names of other partners."
He further deposed, "I have no any document to show that the Mahendra Watch Company has been sold."
RW.1, who is Mr. Mohanlal D. Jain deposed that M/s Mahendra Watch Company is a partnership firm, which was constituted by him and Mr. Rajesh Kumar and that Mr. Rajesh Kumar retired from the firm. Later, the firm was re-constituted and his son Mr. Ashish M. Jain was admitted as partner with effect from 01.07.2000. He placed on record the income tax return filed in Form No.2D for the year 2001-02, 2002-03 and 2003-04, where he was shown as the partner of M/s Mahendra Watch Company. He claimed that he retired from the firm in June, 2008 and his son Mr. Atul M. Jain was inducted into the firm. He claimed that the firm was paying the monthly rent at the rate of Rs.485/- but the landlord demanded
enhanced rent of Rs.3,000/- per month. He contended that PW.1 had assigned all his right, title and interest in the leased property and therefore, he had no locus standi to lead evidence before the Court. He submitted that Mr. Ashish M. Jain and Mr. Atul M. Jain were the present partners of the firm and therefore, the grounds for eviction under Sections 27(2)(b)(ii) and 27(2)(d)(i)(ii) of the Karnataka Rent Act, 1999 was not available.
RW.1 in his cross-examination denied that M/s Mahendra Watch Company was sold by the erstwhile partner to Mr. Ashish M. Jain and Mr. Atul M. Jain. He deposed that when the lease of the petition premises was executed in favour of M/s Mahendra Watch Company, the partners were Mr. Rajesh kumar, Mr. Mahendra Kumar, Mr. Chualal, Mrs. Kamala Bai and Mr. Mohanlal and that a copy of the deed was handed over to the landlord. He admitted that the partnership deed was not registered and that he did not have a copy of the same. He deposed that the partnership was reconstituted in the year 2002 and 2008.
The aforesaid evidence clearly demonstrate that M/s Mahendra Watch Company was a partnership firm. However, there is no evidence of whatsoever nature to indicate as to who were the other partners of the firm. The landlord did not enter the witness box, but his son who was examined as PW.1, deposed that he did not know as to who were the other partners of the firm. However, the business in the premises is run by M/s Mahendra Watch Company till date, which is evident from the photographs at Ex.R1. The nature of business has also not changed. The original of lease deed executed by the landlord in favour of M/s Mahendra Watch Company is in the possession of Mr. Ashish M. Jain and Mr. Atul M. Jain. RW.1 Mr. Mohanlal D. Jain deposed that he was also one of the partners of the firm along with Mr. Rajesh Kumar and after he retired, Mr. Ashish M. Jain was brought into the firm and later Mr. Mohanlal D. Jain retired and in his place Mr. Atul M. Jain was brought in as a partner. As referred earlier, the lease deed dated 22.02.1985 authorised M/s
Mahendra Watch Company to carry on business "in partnership with such other person or persons", makes it difficult to accept the case of the landlord that the premises was sub-let to Mr. Atul M. Jain and Mr. Ashish M. Jain. It is also equally difficult to accept the said contention in view of the fact that the landlord has continuously received the rent from 1991 till 2008 and Mr. Atul M. Jain and Mr. Ashish M. Jain are in possession of the said rent receipts, which are marked as Ex.R2 series. In that view of the matter, the contention of the landlord that the premises is sub-let cannot be accepted. The tenure of lease was 53 years from 22.02.1985 and the landlord in order to overcome the bar against evicting the tenant before the expiry of 53 years, has claimed that the premises is sub-let. Since the landlord has failed to prove, who were the partners of the firm as on the date of the tenancy coupled with the fact that the documents placed on record as Exs.R4, R5, R6, R7, R10, R11, R12 all indicate that M/s Mahendra Watch Company is represented by its partners namely, Mr. Ashish M. Jain and Mr. Atul M.
Jain, it is improbable that the premises is sublet to Mr. Ashish M. Jain and Mr. Atul M Jain
In that view of the matter, the impugned order passed by the Trial Court ordering eviction of the petitioners/tenants deserves to be interfered with.
Consequently, this revision petition is allowed. The impugned order dated 14.07.2017 passed by the Chief Judge, Court of Small Causes at Bengaluru in H.R.C.No.63/2016 is set aside.
The Registry is directed to return the Trial Court records.
Sd/- JUDGE
PMR