M/S PURI INVESTMENTS versus M/S YOUNG FRIENDS AND CO. & ORS. on 23 February 2022

JUDGMENT

Leave granted.

2. The appellant, as the landlord, is the original applicant in aneviction proceeding instituted under Section 14 of the Delhi Rent ControlAct, 1958 (hereinafter referred to as “the Act”) seeking recovery ofpossession of a shop room located at Connaught Place in the centralpart of Delhi. The eviction proceeding was instituted in the year 1974.We shall henceforth refer to the shop room as “subject-premises”. Inthat proceeding instituted before the Rent Controller, Delhi, altogetherthree individuals and three firms were originally impleaded as respondents.In this appeal, however, only three respondents have been impleaded,being the firm-Young Friends & Co. and two individuals – Ashu MohanGupta and Shashi Gupta. They have been described as contestingrespondents. On that count, however, no controversy has been raisedbefore us. The appellant admittedly is the landlord of the subject-premises.This was rented out to the then proprietor (since deceased) of the firstrespondent in the year 1936. The appellant became the landlord thereofon having purchased the subject-premises from its erstwhile owner inthe year 1958. The main ground on which eviction was asked for wassub-letting without consent of the landlord.

3. The respondents run a retail outlet from the subject- premisesand at the material point of time, the respondents were operating fromthere a chemist shop. The substance of allegations of the landlord wasthat the respondents had sub-let certain portions of the premises to threemedical practitioners, (including one dentist) and two other firms. Theywere included as respondent nos. 2, 3, 4, 5 and 6 in the evictionapplication. By an order passed on 5[th ]June, 1997, the Additional RentController, Delhi dismissed the petition holding that the appellant hadfailed to show that there was any sub-letting, assignment or parting withpossession of the tenanted premises in favour of persons/entities whowere included in the array of respondents. So far as respondent no.5(Young Friends & Co.) is concerned, finding was that it was an entity ofthe respondent tenant only. As regards the sixth respondent in the evictionpetition, the Rent Controller held that no sub-letting, assignment or partingwith possession of any portion of the subject-premises. Respondent no.6 was found to be occupying a public verandah outside the tenanted A

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Apremises. The appellant’s plea for eviction was founded on certain othergrounds as well, but those grounds also could not be established beforethe Rent Controller. It was held by the said forum that the respondentnos. 2 to 4 were not in exclusive possession of the subject- premises.

4. The Appellate Tribunal, however, reversed the decision of theBauthority of the first instance, and passed an order of eviction on theground of sub-letting. The Tribunal tested the appellant’s case on thebasis of allegations pertaining to sub- letting to the three medicalpractitioners. The Tribunal accepted the appellant’s stand that the factsof the case disclosed sub- letting of the subject-premises in favour ofrespondent nos. 2 (Dr. Pradip Jayna), 3 (Dr. S. S. Pant) and 4 (Shri K.CN. Mehta). We find from the judgment under appeal that the landlordhad pressed the petition on account of respondent nos. 2, 3 and 4 havingbeen inducted as sub-tenants without the consent in writing by the landlord.

5. The respondents, thus, invoked the provisions of Article 227 ofthe Constitution of India before the Delhi High Court assailing the orderDof the Tribunal. The respondents were successful in that proceedings.The High Court, in the judgment delivered on 14[th ]November, 2018allowed the application under Article 227 of the Constitution of India,inter alia, holding:- “51. The prime conclusion of ARCT that the user of the space byER-2 to R-4 during the period they were in their respective clinicrenders it they being in “exclusive possession” is not supportedby any evidence, it being a conclusion based on surmises. Asobserved earlier, in the proceedings before the ARC, the landlordresting its case primarily on the evidence of its managing partnerF(AW-3) had failed to adduce such material, as could show a thirdparty being in possession to the exclusion of the tenant. On thecontrary, the evidence of the landlord, as indeed of the tenant,unmistakably show that the tenant has always been in full controland possession-physical and legal-of the tenanted premises. Thepresence of others was temporary, for a few hours of the dayGwhen the tenant would also be present, and clearly for permissiveuse, it having come to an end, such persons having left the premiseson their own when called upon to do so by the tenant.

52. The view taken by the ARCT, clearly, was erroneous, it beingbased on conclusions which are contrary to the evidence that was H

adduced, and by drawing inferences which were not permissiblein law, the appellate power having been improperly exercised forsubstituting one subjective satisfaction with another without therebeing a justifiable reason to do so.

53. Consequently, the petition is allowed. The impugned judgmentdated 29.08.2007 of the Additional Rent Control Tribunal is setaside. The judgment dated 05.06.1997 of the Additional RentController stands restored and revived. In the result, the evictioncase of the respondent stands dismissed.”

6. This judgment of the High Court is under appeal before us.Main argument of Mr. Dhruv Mehta, learned senior counsel appearingwith Mr. Jeevesh Nagrath, learned counsel appearing for the appellanthas been that sub-letting had been proved before the final fact-findingforum (at the appellate stage) and the appellate forum had returnedfindings on facts. In such circumstances, the High Court in its supervisoryjurisdiction ought not to have had upset the order of the AppellateTribunal.

7. The legal point, which has been argued before us, is as to whetherthe act of the respondents in inducting the three medical practitionersconstituted sub-letting or not. This point, no doubt, has to be determinedon the basis of evidence adduced before the fact-finding forum. Thedispute involved in this appeal does not give rise to any complex legalquestion. Thus, in exercise of our jurisdiction under Article 136 of theConstitution of India, scope of our interference would be limited to theissue as to whether the decision of the High Court in upsetting the orderof eviction passed by the Appellate Tribunal suffered from any elementof perversity or not. It has been urged before us on behalf of the appellantthat the High Court ought not to have interfered in the matter as theorder of the Appellate Tribunal was based on appreciation of evidenceand bore no taint of perversity which would have warranted interferenceunder Article 227 of the Constitution of India. Several authorities havebeen relied upon before us by the learned counsel appearing for theparties. These authorities mainly deal with the nature and scope ofoccupation in a rented property of persons not being tenant but inductedby the latter which would attract the mischief of sub-letting. Theseauthorities relate to specific instances of induction of persons by the tenantbased on the facts of each case. The appellant has cited the cases of:- A

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A(i)Flora Elias Nahoum & Ors. v. Idrish Ali Laskar[(2018) 2 SCC 485]

(ii) Celina Coelho Pereira (Ms) & Ors. v. UlhasMahabaleshwar Kholkar & Ors. [(2010) 1 SCC 217]

(iii) Bharat Sales Ltd. v. Life Insurance Corporation ofBIndia [(1998) 3 SCC 1]

(iv) Smt. Rajbir Kaur & Anr. v. S Chokesiri & Co.[(1989) 1 SCC 19]

(v) Chimajirao Kanhojirao Shirke & Anr. v. Oriental FireC& General Insurance Co. Ltd. [(2000) 6 SCC 622].

Mr. Rana Mukherjee, learned senior counsel for the respondents,on the other hand, has cited the following authorities including the caseof Flora Elias Nahoum (supra). These cases are:-

(i) Dipak Banerjee v. Lilabati Chakraborty [(1987) 4 SCCD161]

(ii) Jagan Nath v. Chander Bhan & Ors. [(1988) 3 SCC57]

(iii) Shalimar Tar Products Ltd. v. H. C. Sharma & Ors.

E[(1988) 1 SCC 70]

(iv) Ram Murti Devi v. Pushpa Devi & Ors. [(2017) 15SCC 230].

In our view, the guiding principles which emerge from theseauthorities on the question which we are addressing in this judgment canFbe adopted from the following three decisions:-

(i) Ram Murti Devi (supra)

(ii) Flora Elias Nahoum (supra)

(iii) Bharat Sales Ltd. (supra)

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8. In the case of Ram Murti Devi (supra), it has been held:- “21.1. In a suit by the landlord for eviction of the tenant on theground of sub-letting the landlord has to prove by leading evidencethat:

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M/S PURI INVESTMENTS v.

M/S YOUNG FRIENDS AND CO. & ORS.

(a) A third party was found to be in exclusive possession of thewhole or part of rented property.

(b) Parting of possession thereof was for monetary consideration.

21.2. The onus to prove sub-letting is on the landlord and if he hasestablished parting of possession in favour of a third party eitherwholly or partly, the onus would shift to the tenant to explain.”

In the case of Flora Elias Nahoum (supra) the question of burdento establish sub-letting has been discussed and it has been observed:- “36. In our view, since the respondent had admitted the presenceof Joynal Mullick in the suit shop, the burden was on him to proveits nature and the capacity in which he used to sit in the suit shop.”

In that case, plea of sub-letting was made on the allegation ofinducting one Joynal Mullick in a shop room by the tenant.

9. On the question of onus to establish receipt of monetaryconsideration by the tenant from the person whose induction gives riseto cause of action based on sub-letting, it has been held in the case ofBharat Sales Ltd. (supra):- “4. Sub-tenancy or sub-letting comes into existence when the tenantgives up possession of the tenanted accommodation, wholly or inpart, and puts another person in exclusive possession thereof. Thisarrangement comes about obviously under a mutual agreement orunderstanding between the tenant and the person to whom thepossession is so delivered. In this process, the landlord is kept outof the scene. Rather, the scene is enacted behind the back of thelandlord, concealing the overt acts and transferring possessionclandestinely to a person who is an utter stranger to the landlord,in the sense that the landlord had not let out the premises to thatperson nor had he allowed or consented to his entering intopossession over the demised property. It is the actual, physicaland exclusive possession of that person, instead of the tenant, whichultimately reveals to the landlord that the tenant to whom theproperty was let out has put some other person into possession ofthat property. In such a situation, it would be difficult for thelandlord to prove, by direct evidence, the contract or agreementor understanding between the tenant and the sub-tenant. It wouldalso be difficult for the landlord to prove, by direct evidence, that A

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Athe person to whom the property had been sub-let had paidmonetary consideration to the tenant. Payment of rent, undoubtedly,is an essential element of lease or sub-lease. It may be paid incash or in kind or may have been paid or promised to the paid. Itmay have been paid in lump-sum in advance covering the periodfor which the premises is let out or sub-let or it may have beenBpaid or promised to be paid periodically. Since payment of rent ormonetary consideration may have been made secretly, the lawdoes not require such payment to be proved by affirmativeevidence and the court is permitted to draw its own inferenceupon the facts of the case proved at the trial, including the deliveryCof exclusive possession to infer that the premises were sub-let.”

10. In the case before us, occupation of a portion of the subject-premises by the three doctors stands admitted. What has been arguedby the learned counsel for the appellant is that once the Tribunal hadarrived at a finding on fact based on the principles of law, which haveDbeen enunciated by this Court, and reflected in the aforesaid passagesquoted from the three authorities, the interference by the High Courtunder Article 227 of the Constitution of India was unwarranted. Topersuade us to sustain the High Court’s order, learned counsel appearingfor the respondents has emphasized that full control over the premiseswas never ceded to the medical practitioners and the entry and exit to Ethe premises in question remained under exclusive control of therespondent(s)-tenant. This is the main defence of the tenant. We haveconsidered the submissions of the respective counsel and also gonethrough the decisions of the fact-finding fora and also that of the HighCourt. At this stage, we cannot revisit the factual aspects of the dispute.

FNor can we re-appreciate evidence to assess the quality thereof, whichhas been considered by the two fact-finding fora. The view of the forumof first instance was reversed by the Appellate Tribunal. The High Courtwas conscious of the restrictive nature of jurisdiction under Article 227of the Constitution of India. In the judgment under appeal, it has been recorded that it could not subject the decision of the appellate forum in aGmanner which would project as if it was sitting in appeal. It proceeded,on such observation being made, to opine that it was the duty of thesupervisory Court to interdict if it was found that findings of the appellateforum were perverse. Three situations were spelt out in the judgmentunder appeal as to when a finding on facts or questions of law would beHperverse. These are:-

(i) Erroneous on account of non-consideration of materialevidence, or

(ii) Being conclusions which are contrary to the evidence, or

(iii) Based on inferences that are impermissible in law.

11. We are in agreement with the High Court’s enunciation ofthe principles of law on scope of interference by the supervisory Courton decisions of the fact-finding forum. But having gone through thedecisions of the two stages of fact-finding by the statutory fora, we areof the view that there was overstepping of this boundary by the supervisoryCourt. In its exercise of scrutinizing the evidence to find out if any of thethree aforesaid conditions were breached, there was re-appreciation ofevidence itself by the supervisory Court.

12. In our opinion, the High Court in exercise of its jurisdictionunder Article 227 of the Constitution of India in the judgment underappeal had gone deep into the factual arena to disagree with the finalfact-finding forum. There is no dispute that the three medical practitionerswere in occupation of part of the premises in question. The onus, undersuch circumstances, was on the respondents to establish the degree ofcontrol they were maintaining over the said premises for repelling theplea of sub-letting or assignment or parting with possession. From thepassage of the judgment of this Court in the case of Bharat Sales Ltd.(supra) above, it transpires that it was also the respondents’ obligation todemonstrate that there was no monetary consideration on the basis ofwhich the medical practitioners were allowed to operate from the subjectpremises. Though, it was a chemist shop, evidence reveals that the portionof the premises of which the three medical practitioners were inoccupation consisted of individual cabins and had separate telephoneconnections. These are the factors, on the basis of which, the AppellateTribunal came to its conclusion against the respondents. The AppellateForum found:- “26. I may observe that the job of a doctor is basically to provideconsultancy. He is not to sell any goods. He is only to examine thepatients and prescribe treatment and charge his fee. For doing soaforesaid, he only requires a place where he can sit, the client cancome, the doctor may have privacy and is able to write aprescription to the client and, if required, to examine him either ona dental chair in the case of a Dentists or a bed in case of other A

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Apatients and nothing else. All these facilities were being madeavailable to the doctors who came to the suit premises and thatalso in exclusive portion, i.e., Mezzanine floor without anyinterference even by the tenant. Merely because the doctors hadto come at fixed hours would not make their occupation merelythat of a licensee and not of a sub-tenant, because now it is aBmatter of common sense and common knowledge that manybuildings have a common central door where a lock is put by aguard who opens the same in the morning and closes the same inthe evening while everyone occupying a portion of the buildinguses his own portion as and when they are required to come asCalso it is being done in the case of a lawyer. The lawyer alsocomes only in the office hours and in the day is not expected toremain in his chamber. However, in the case of a lawyer, he isrequired to maintain a library and records and might be using hislibrary. But in the case of a doctor, he is not required to keep anylock because what he is required to do is to come, sit, provideDconsultancy and go. Thus, for the period for which he is in hisclinic, he has exclusive possession thereof. It does not matterthat before starting his practice and closing the same, the premisesis not even locked by him. It is nobody’s case that till such time,the doctors were permitted to run their practice in the polyclinic,Ethey were asked to go back even during the hours fixed for openingthe clinic. Merely because the first Respondent being a chemistwas also being benefitted in selling his medicines will not permit atenant to allow number of doctors to sit and run their ownconsultancy including the Dentist who otherwise may not haveanything to do with the sale of medicine and is required to fix teethFwhich are prepared elsewhere and not by the first Respondent orby cleaning the teeth which is the major service provided by theDentist. Moreover, permitting a Dentist to have his own chair in aclinic where visiting hours are limited, would not make the doctoronly a licencee.

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27. At this juncture, I may observe that user of the property bylicencees are those cases where family members, a wife, or a sonhave been permitted to use a portion of the suit property alongwith the tenant who happens to be either the father or the husband or a near relative which is not the case here.

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28. As a matter of fact, the arrangement which was being followedbetween the tenant and the doctor, namely Respondent nos. 2 to4, makes it explicit that that user of the suit premises that too ofMezzanine floor was exclusive for the time they were permittedto run their practice and must have been under a secretarrangement between the tenant and the doctors to which thelandlord cannot have access and he can only infer that some kindof consideration must have passed by the sub-tenant in favour ofthe tenant which must be the only reason as to why the firstRespondent permitted user of portion of suit property to Respondentnos. 2 to 4 on regular intervals and also permitted them to puttheir names outside the polyclinic including the timings of theircoming. The tenant even allowed them to have their own telephonesinstalled in the suit premises so as to facilitate the clients to havethe consultancy at a time convenient to the doctor and the patientwithout any interference of the tenant in this regard. Such kind ofarrangement cannot be termed as mere licence and must betreated as exclusive possession though for a short period and wouldcertainly furnish a ground for eviction under Section 14(1)(b) ofthe Delhi Rent Control Act. Accordingly, the Trial Court has notappreciated this fine distinction of law and, therefore, the findingsreturned by the Trial Court suffer from material irregularity andcalls for interference by this appellate court.”

13. There was no perversity in the order of the Appellate Tribunalon the basis of which the High Court could have interfered. In our view,the High Court tested the legality of the order of the Tribunal through thelens of an appellate body and not as a supervisory Court in adjudicatingthe application under Article 227 of the Constitution of India. This isimpermissible. The finding of the High Court that the appellate forum’sdecision was perverse and the manner in which such finding was arrivedat was itself perverse.

14. For these reasons, we set aside the judgment of the HighCourt and restore the Appellate Tribunal’s findings.

15. On conclusion of the dictation of this judgment, which waspronounced in open Court, Mr. Rana Mukherjee, learned senior counselprayed for some time to enable the respondents to vacate the premisesin question. We are also apprised that the respondents had paid occupationcharges at the rate of rupees thirty thousand per month from 15.05.2009

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Atill 14.11.2018. It is an admitted position, as confirmed by the learnedcounsel for the appellant as well as the respondents, that subsequent tothat date payment of occupation charges at the rate of rupees thirtythousand per month has been stopped. It has been stated by Mr.Mukherjee that the respondents were remitting rupees ninety per monththereafter, being the original rent, but the appellant had refused to receiveBthe same.

16. We accordingly direct that the appellant would be entitled tooccupation charges rupees thirty thousand per month from 14.11.2018till the subject-premises are vacated by the respondents, and therespondents must vacate the premises within a period of 53 weeks fromCdate. A sum of rupees one lac shall be remitted to the appellant withinone month from date and rupees twelve lacs within six months fromdate. So far as the occupation charges for the period of 53 weeks fromtoday is concerned, by which period the respondents shall vacate thepremises, the respondents shall remit to the bank account of the appellant Dthe said sum of rupees thirty thousand per month by the last date of eachmonth and if any further sum is found due on computation made in themanner indicted above, such additional sum shall also be remitted withinthe aforesaid period of six months.

17. The period permitting the respondents to continue in occupationEshall remain unconditional for a month from today, by which time therespondents shall give an undertaking that they would vacate the premisesin question on or before 28.02.2023 and shall handover the peaceful andvacant possession to the appellant also by that date, i.e., on or before28.02.2023. Such undertaking shall be in the form of an affidavit. Thisundertaking shall be filed in this Court within a period of one month fromFdate. The respondents or any one of them shall not create any third-party rights qua the premises in question in the meantime.

18. The appeal stands allowed in the above terms.

19. There shall be no order as to costs.

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Devika Gujral(Assisted by : Shevali Monga, LCRA)

Appeal allowed.

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