MAHADEV P KAMBEKAR (D) TR. LRS. versus SHREE KRISHNA WOOLEN MILLS PVT. LTD. on 31 January 2019

[2019] 1 S.C.R. 827

MAHADEV P KAMBEKAR (D) TR. LRS.

v.

SHREE KRISHNA WOOLEN MILLS PVT. LTD.

(Civil Appeal Nos. 5753-5754 of 2011)

JANUARY 31, 2019

[ABHAY MANOHAR SAPRE ANDR. SUBHASH REDDY, JJ.]

Presidency Small Cause Courts Act, 1882 – s. 41 – Counterclaim – Maintainability – On facts, dispute between the partiesrelating to land in Bombay suburban district – Suit by plaintiff-lessee(respondent) against defendant-lessor/owner(appellants) onthe original side of Bombay High Court claiming specificperformance of contract-lease deed in relation to suit land –Defendant filing counter claim against the plaintiff seeking theireviction from suit land and arrears of rent – Single Judge allowedthe counter claim and passed decree for possession of the suit land – Division Bench of the High Court held that the Single Judgewrongly entertained the counter claim as it had no jurisdiction onits original jurisdiction to entertain counter claim of this nature inlight of s. 41 – Correctness of – Held: Division Bench of High Courtrightly held that the counter-claim filed by the defendant was notmaintainable – Whether it is a suit between the licensor and thelicensee or between the landlord and the tenant, such types of suitsfall u/s. 41 and are, thus, cognizable by the Courts of Small Causes,Bombay – Once the tenancy is determined such suits would comewithin the purview of s. 41 – Parties to raise the factual issuesbefore the competent court which would come to the conclusion onmerits.

Dismissing the appeals, the Court

HELD: 1.1 The High Court in the impugned judgmentrightly held that the counter-claim filed by the defendant(appellants) is not maintainable. There is no ground to take adifferent view than what has been taken by the High Court.[Paras 25, 26][835-G-H]

1.2 Whether it is a suit between the licensor and thelicensee or between the landlord and the tenant, such types of

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Asuits fall under Section 41 of the Small Cause Courts Act and are,therefore, cognizable by the Courts of Small Causes, Bombay.[Para 29][836-C-D]

1.3 The submission that once the tenancy is determinedsuch suits would not come within the purview of Section 41 of theBSmall Cause Courts Act, was rightly rejected by the DivisionBench of the High Court. [Para 30][836-D-E]

Nagin Mansukhlal Dagli v. Haribhai Manibhai PatelAIR 1980 Bombay 123 – approved.

1.4 It is now for the parties to raise all such factual issue(s)such as how much area was leased out, how much area is outsideCthe lease, who are the owners of the leased area and the areasadjacent to leased area and all incidental questions arisingtherefrom before the competent Court. It is apart from the factthat these factual issues were also not gone into by the DivisionBench and indeed rightly. It is for this reason, there is no groundDto deal with them for the first time in these appeals else it willcause prejudice to the rights of the parties while prosecutingtheir grievances before the competent Court. The competentCourt would come to its own conclusion on their respective meritsand pass appropriate orders in accordance with law. [Para 32,33][836-G-H; 837-A-B]EMansukhlal Dhanraj Jain & Ors. v. Eknath Vithal Ogale(1995) 2 SCC 665 : [1995] 1 SCR 996; PrabhudasDamodar Kotecha & Ors. v. Manhabala JeramDamodar & Anr. (2013) 15 SCC 358 : [2013] 9 SCR52 – relied on.

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Case Law Reference

From the Judgment and Order dated 19.07.2007 of the High Courtof Judicature at Bombay in Appeal No. 169 of 1999 in Suit No. 503 of1980 and in Appeal No. 199 of 1999 in Suit No. 503 of 1980.

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Shekhar Naphade, Shyam Divan, Sr.Advs., Mahesh Agarwal,Yatin Shah, Gaurav Goel, Abhikalp Pratap Singh, Ms. S.Lakshmi Iyer,Prateek Rusia, Ms.Aastha Mehta, E.C.Agrawala, Manish Sharma,Mrs.Mayuri Raghuvanshi, Vjom Raghuvanshi, Pranay Raj Singh,Ms.Samiksha, Ms.Deepa M. Kulkarni, Nishant RamakantraoKatneshwarkar, Ms.Asha Gopalan Nair, Advs. for the appearing parties.

The Judgment of the Court was delivered by

ABHAY MANOHAR SAPRE, J. 1. These appeals are directedagainst the final judgment and order dated 19.07.2007 passed by theHigh Court of Judicature at Bombay in Appeal No.169 of 1999 in SuitNo.503 of 1980 and in Appeal No.199 of 1999 in Suit No.503 of 1980whereby the Division Bench of the High Court allowed both the appealsfiled by the appellants herein (defendant) and the respondent(plaintiff)herein respectively.

2. In order to appreciate the controversy involved in these appealswhich lies in a narrow compass, it is necessary to set out the relevantfacts hereinbelow.

3. The appellants are the legal representatives of MahadevPandurang Kambekar, who was the original defendant whereas therespondent-Shree Krishna Woolen Mills Pvt. Ltd. is the plaintiff in theCivil Suit out of which these appeal arise.

4. The dispute between the parties relates to the land bearingsurvey Nos.58 and 60 (re-numbered as CTS 741,741/1 to 741/7) situatedat Nahur-Bhandup in Bombay suburban District (hereinafter referred toas “the suit land”).

5. The plaintiff claims to be the lessee of the suit land whereasthe defendant claims to be the owner/lessor of the suit land on the termsset out in the indenture of the lease deed dated 20.06.1958 executedbetween the parties.

6. A dispute arose between the parties. This led the defendant todetermine the lease in question by serving a quit notice dated 19.02.1980to the plaintiff requesting them to handover the leased premises, whichwas in their possession, to the defendant.

7. The plaintiff then filed a Civil Suit (No.503 of 1980) against thedefendant on the original side of the Bombay High Court claiming therein AB

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Athe specific performance of the contract (lease deed) in relation to thesuit land.

8. The suit was based essentially on clause 7 of the Lease Deedwhich, according to the plaintiff, enabled them to elect and exercisetheir right to purchase the suit land from the defendant on fulfillment ofBthe conditions set out therein.

9. The defendant on being served filed the written statement. Thedefendant denied the claim and at the same time also filed his counterclaim against the plaintiff seeking their eviction from the suit land andthe arrears of rent.

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10. The Single Judge by judgment/decree dated 24.12.1998 decreedthe plaintiff’s suit for specific performance of contract and directed thedefendant to execute the conveyance deed in favour of the plaintiff ofthe suit land. The Single Judge also allowed the counter claim filed bythe defendant and accordingly passed the decree for possession of theDsuit land and arrears of rent for three years against the plaintiff.

11. The appellants (defendant) and the respondent (plaintiff) bothfelt aggrieved by the judgment/decree passed by the Single Judge andfiled their respective appeals before the Division Bench.

12. So far as the defendant’s (appellants herein) Appeal No.169/E1999 was concerned, it arose out of the decree passed against him forspecific performance of the contract, whereas so far as the plaintiff’s(respondent herein) appeal (No.199/1999) was concerned, it arose outof the decree passed against them for possession of the suit land andarrears of rent.

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13. By impugned judgment, the Division Bench allowed both theappeals. So far as appeal (169/1999) filed by the appellants (defendant)was concerned, the Division Bench set aside the judgment /decree andremanded the suit for re-trial to the Single Judge on merits afresh inaccordance with law.

14. So far as appeal (199/1999) filed by the respondent (plaintiff)was concerned, the Division Bench set aside the judgment/decree onthe ground that the counter-claim was not maintainable in view of Section41 of the Presidency Small Cause Courts Act, 1882 ( for short called“the Act 1882”) . In other words, the Division Bench held that so far ascounter-claim filed by the defendant against the plaintiff is concerned, G

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the Single Judge wrongly entertained it as it had no jurisdiction on itsoriginal jurisdiction to entertain counter-claim of this nature in the lightof the provisions of Section 41 of the Act 1882.

15. The defendant (appellants herein), i.e., lessor felt aggrievedby that part of the order of the Division Bench which resulted in dismissalof his counter-claim and filed the present appeals by way of specialleave in this Court.

16. So far as the order of the Division Bench which resulted insetting aside of the judgment/decree of the Single Judge and remandingof the suit for re-trial on merits is concerned, it attained finality as aresult of dismissal of SLP filed by the plaintiff in this Court.

17. The short question, which arises for consideration in theseappeals, is whether the Division Bench was right in dismissing thedefendant’s counter-claim as being not maintainable.

18. Heard Mr. Shekhar Naphade, learned senior counsel for theappellants and Mr. Shyam Divan, learned senior counsel for therespondent.

19. Mr. Naphade, learned senior counsel appearing for theappellants (defendant) and Mr. Shyam Diwan, learned senior counselappearing for the respondent (plaintiff) addressed the Court at length.However, having heard both the learned counsel and on perusing therecord of the case, we find no merit in these appeals.

20. In our considered opinion, the issue involved in the presentappeals remains no longer res integra and is decided by this Court in thecase of Mansukhlal Dhanraj Jain & Ors. vs. Eknath Vithal Ogale[(1995) 2 SCC 665].

21. In Mansukhlal case (supra), the question arose as to whetherthe suit filed by the plaintiff claiming to be the licensee of the premiseson monetary consideration and seeking permanent injunction restrainingthe defendant (licensor) from recovery of the possession of the premisesis cognizable by the City Civil Court, Bombay constituted under theBombay City Civil Court Act or is cognizable by the Court of SmallCauses Bombay as per Section 41(1) of the Act, 1882.

22. It is this question, which was examined by this Court in detailin the light of the relevant provisions of the Bombay City Civil Court Act, A

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Athe Presidency Small Cause Courts Act, 1882 and the Bombay Rents,Hotel and Lodging House Rates Control Act, 1947.

23. Having examined the question, their Lordships speaking throughMajmudar, J. held that such suit is cognizable and thus maintainable inthe Court of Small Causes, Bombay.

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24. It is apposite to refer the discussion contained in paras 11, 12,13, 16, 17 and 18 which read as under:

“11. In order to resolve the controversy posed for ourconsideration, it will be appropriate to note the relevantstatutory provision having a direct bearing on this question.CSection 41(1) of the Small Cause Courts Act reads as under:

“41. (1) Notwithstanding anything contained elsewherein this Act or in any other law for the time being in forcebut subject to the provisions of sub-section (2), the Courtof Small Causes shall have jurisdiction to entertain andDtry all suits and proceedings between a licensor andlicensee, or a landlord and tenant, relating to therecovery of possession of any immovable propertysituated in Greater Bombay, or relating to the recoveryof the licence fee or charges or rent thereof, irrespectiveEof the value of the subject-matter of such suits orproceedings.”

12. A mere look at the aforesaid provision makes it clearthat because of the non-obstante clause contained in thesection, even if a suit may otherwise lie before any othercourt, if such a suit falls within the sweep of Section 41(1) itFcan be entertained only by the Court of Small Causes. Inthe present proceedings we are not concerned with theprovisions of sub-section (2) of Section 41 and hence wedo not refer to them. For applicability of Section 41(1) ofthe Small Cause Courts Act, the following conditions mustGbe satisfied before taking the view that jurisdiction ofregular competent civil court like City Civil Court is ousted:

(i) It must be a suit or proceeding between the licenseeand licensor; or

(ii) between a landlord and a tenant;

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(iii) such suit or proceeding must relate to the recoveryof possession of any property situated in GreaterBombay; or

(iv) relating to the recovery of the licence fee or chargesor rent thereof.

13. In the present case, we are not concerned with the 2ndand 4th conditions, as the only contention of the appellantsis that the present suits do not satisfy conditions 1 and 3for attracting Section 41(1). The respondents claim to thecontrary. It is obvious that if the present suits satisfyconditions 1 and 3 they would clearly attract the applicabilityof Section 41(1) of the Act and such suits would be outsidethe purview of regular civil court like the City Civil Court.Therefore, the enquiry which becomes relevant at this stageis to find out from the averments in the plaints whetherthese are suits between a licensor and a licensee andwhether they relate to the recovery of possession ofimmovable property situated in Greater Bombay.

16. It is, therefore, obvious that the phrase “relating torecovery of possession” as found in Section 41(1) of theSmall Cause Courts Act is comprehensive in nature andtakes in its sweep all types of suits and proceedings whichare concerned with the recovery of possession of suitproperty from the licensee and, therefore, suits forpermanent injunction restraining the defendant fromeffecting forcible recovery of such possession from thelicensee-plaintiff would squarely be covered by the widesweep of the said phrase. Consequently in the light of theaverments in the plaints under consideration and theprayers sought for therein, on the clear language of Section41(1), the conclusion is inevitable that these suits could liewithin the exclusive jurisdiction of Small Cause Court,Bombay and the City Civil Court would have no jurisdictionto entertain such suits.

17. We may now refer to the relevant decisions of this Courtand other courts to which our attention was invited bylearned counsel for both the sides. As some of the decisions A

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referred to a pari materia provision as found in Section 28of the Bombay Rents, Hotel and Lodging House RatesControl Act, 1947 (hereinafter referred to as “the BombayRent Act”), it will be necessary to refer to the said provision.Section 28(1) of the Bombay Rent Act reads as under:

“28. Jurisdiction of courts.—Notwithstanding anythingcontained in any law and notwithstanding that by reasonof the amount of the claim or for any other reason, thesuit or proceeding would not, but for this provision, bewithin its jurisdiction,—

(a) in Greater Bombay, the Court of Small Causes,Bombay, (aa) in any area for which, a Court of SmallCauses is established under the Provincial Small CauseCourts Act, 1887, such Court and (b) elsewhere, the Court of the Civil Judge (JuniorDivision) having jurisdiction in the area in which thepremises are situate or, if there is no such Civil Judge,the Court of the Civil Judge (Senior Division) havingordinary jurisdiction, shall have jurisdiction to entertain and try any suit orproceeding between a landlord and a tenant relating tothe recovery of rent or possession of any premises towhich any of the provisions of this Part apply….”

18. When Section 41(1) of the Small Cause Courts Act isread in juxtaposition with the aforesaid Section 28 of theBombay Rent Act, it becomes clear that pari materia wordsare used about nature of suits in both these provisions forconferring exclusive jurisdiction on Small Cause Courts,namely, they alone can entertain such suits or proceedingsrelating to recovery of possession of premises. It is ofcourse true that Section 41 of the Small Cause Courts Actdeals with such suits between the licensee and licensorwhile Section 28 of the Bombay Rent Act deals with suitsbetween landlord and tenant. But the nature of such suitsas contemplated by both these sections is the same, namely,it should be the suit relating to the recovery of possessionof premises. Interpreting the phrase “relating to recovery of possession” as found in Section 28 of the Bombay RentAct, a Bench of three learned Judges of this Court in thecase of Babulal Bhuramal v. Nandram Shivram6 held that asuit for declaration that one of the plaintiffs was the tenantof the defendant landlord and the other plaintiffs were hissub-tenants and they were entitled to be protected fromeviction squarely falls within the exclusive jurisdiction ofthe Small Cause Court, Bombay under Section 28 of theBombay Rent Act and jurisdiction of the City Civil Courtfor entertaining such a suit is excluded. Imam, J. speakingfor the three-Judge Bench in that case observed at page374 of the report as under:

“The present suit filed in the City Civil Court raised insubstance a claim to the effect that the plaintiffs werethe tenants of the premises within the meaning of theAct. Such a claim was one which arose out of the Act orany of its provisions. The suit related to possession ofthe premises and the right of the landlord to evict any ofthe plaintiffs was denied on the ground that the firstplaintiff was a tenant within the meaning of the Act andthe premises had been lawfully sublet by him to thesecond and third plaintiffs. The City Civil Court was thuscalled upon to decide whether the first plaintiff was atenant of the premises within the meaning of the Act andwhether he had lawfully sublet the same to the secondand third plaintiffs. The City Civil Court, therefore, hadto determine whether the plaintiffs had established theirclaim to be in possession of the premises in accordancewith the provisions of the Act.”

25. In the light of the law laid down by this Court in Mansukhlal’scase (supra) which was later relied on in Prabhudas Damodar Kotecha& Ors. vs. Manhabala Jeram Damodar & Anr. [(2013) 15 SCC358], we have no hesitation in affirming the view taken by the HighCourt in the impugned judgment which rightly held that the counter-claim filed by the defendant (appellants herein) is not maintainable.

26. In our considered view, the law laid down in these two caseshas full application to the facts of this case and we find no ground totake a different view than what has been taken by the High Court.

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27. The only distinction on the facts of the case of Mansukhlal(supra) and the case at hand is that in case of Mansukhlal (supra), thedispute was between the licensee and the licensor in relation to the land,whereas in the case at hand, the dispute is between the landlord and thetenant.

B28. This factual distinction, in our view, is of no significance fordeciding the issue in question against the appellants by placing relianceon the law laid down in the case of Mansukhlal (supra) because boththe category of cases, i.e., the one arising between the licensor and thelicensee and the other arising between the landlord and the tenant inrelation to the land are governed by Section 41 of the Small Cause CourtsCAct.

29. In other words, whether it is a suit between the licensor andthe licensee or between the landlord and the tenant, such types of suitsfall under Section 41 of the Small Cause Courts Act and are, therefore,cognizable by the Courts of Small Causes, Bombay.D

30. This takes us to deal with the next argument of Mr. Naphade,learned senior counsel for the appellants that once the tenancy isdetermined such suits would not come within the purview of Section 41of the Small Cause Courts Act. This argument was rejected by theDivision Bench and, in our view, rightly by placing reliance on the lawElaid down by the Bombay High Court in the case of Nagin MansukhlalDagli vs. Haribhai Manibhai Patel (AIR 1980 Bombay 123) (Para 8of the said decision quoted in the impugned order). We approve the lawlaid down by the Bombay High Court in the case of Nagin MansukhlalDagli (supra) as laying down the correct principle of law. We, therefore,Fdo not consider it necessary to elaborate our reasoning more than whatwe have said.

31. Before parting, we consider it apposite to make it clear thatthough both learned senior counsel in support of their respectivesubmissions referred extensively to the factual matrix of the case fromGtheir respective list of dates, pleadings and the documents but we haverefrained from recording any factual finding on any of the factual issues.

32. Indeed, in the light of what we have held supra on legalquestion, it is not necessary. It is now for the parties to raise all suchfactual issue(s) such as how much area was leased out, how much areais outside the lease, who are the owners of the leased area and the areas H

adjacent to leased area and all incidental questions arising therefrombefore the competent Court.

33. It is apart from the fact that these factual issues were also notgone into by the Division Bench and indeed rightly. It is for this reason,we find no ground to deal with them for the first time in these appealselse it will cause prejudice to the rights of the parties while prosecutingtheir grievances before the competent Court. Now, it will be for thecompetent Court to come to its own conclusion on their respective meritsand pass appropriate orders in accordance with law.

34. In view of the foregoing discussion and the observations, wefind no merit in these appeals. The appeals thus fail and are accordinglydismissed.

Nidhi Jain

Appeals dismissed.

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