1989 PLP 2087 (MLD)

8. In that view of the matter we are clearly of the opinion that in this case there was no consent in writing on the part of landlord to such subletting.

9. Dr. Shankar Ghosh tried to state that in view of the fact that the key of the premises was stated to be in the custody of the tenant, there was no subletting. It was the mere user, it was urged. It is difficult to accept this contention. The case of subletting was accepted as has been found by all the Courts in this case.

10. Our attention was drawn to the certain observations on the question of the directory/mandatory nature of the requirement that consent should be in writing.

11. Reliance was placed on the observations of Craies on Statute Law 7th Edition 261 wherein in the election case requirement that ballot-paper had to be kept in particular manner was considered to be directory and similarly it was submitted in this case the requirement of the consent to be in writing should be construed to be directory. It was urged that the conduct of the parties indicated that there was no breach of the covenant. We are unable to agree. Here the situation is clearly different. Here the requirement of consent to be in writing was to serve a public purpose, i.e. to avoid dispute as to whether there was consent or not.

12. Reliance was also placed on the observations of Maxwell in the Interpretation of Statutes 12th Edition at page 328 on the question of waiver:- Everyone has a right to waive and to agree to waive the advantage of a law made solely for the benefit and protection of the individual in his individual capacity. We are, however, in this case unable to agree. Firstly, in this case there was no case of waiver. Waiver is a question of fact which has to be tested by facts and evidence. There was no conscious relinquishment of the advantage of any statute. No Court has gone into this fact. It does not seem to have been urged before the High Court also. Apart from this, in this requirement of the statute which is in the public interest there cannot be any question of waiver of a right, dealing with the rights of the tenants or the landlord. In Chaplin v. Smith (1926) 1 KB 198, it was held that physical possession was not sufficient, there must be legal possession.

13. The question was whether there was any consent in writing in this case. We have noticed clause 14 of the lease deed states that the lessee will not sublet the premises or any part to any party without the written permission of the lessor except that the lessee's Contractors Messrs R.C. Abrol & Co. Private Ltd. will share the premises with the permission of the lessor. So, the permission of the lessor was there but the purpose was of the sharing with Messrs R.C. Abrol & Co. Private Ltd. was not of leasing the premises to any other entity. For the purpose of this, it is suffice for us to state that clause 14 as enjoined did (not) give permission of leasing the premises to Messrs R.C. Abrol & Co. Private Ltd. which was a different entity.

14. Dealing with this contention the High Court observed in its judgment that the company had been incorporated some time in 1957 after the commencement of the tenancy. Company was a distinct legal entity. It appears in this case that the company was composed of the different persons. The High Court noted than there was never any consent in writing of the landlord to subletting the premises to the incorporated company. The permission must have been in writing and specific in the words of Justice Sarkar in South Asia Industries Private Ltd. v. Sarup Singh A I R 1966 SC 346 (supra).

15. In the case of Mehta Jagjivan Ramchand v. Doshi Vanechand, A I R 1972 Guj. 6, Justice Thakkar as he then was of the Gujarat High Court observed at page 8 of the report.- A similar question was raised before the Madras High Court in Gundalpalli Rangamannar Chetty v. Desu Rangiah, A I R 1954 Mad.

182. A reference was made to Jackson v. Simons, (1923) 1 Ch. 373 and the distinction drawn between physical possession and legal possession in that decision was taken into account in rejecting the contention of the landlord that there was a subletting or assignment: It has been observed by the Madras High Court in paragraph (5) of the said decision as under:- In Jackson v. Simons (1923) 1 Ch. 373(B) the question was whether the tenant broke. a similar covenant. The defendant who was the tenant, without the plaintiffs' consent or knowledge agreed for the sum of Ŀ 7 per week to allow the proprietor of a night club carried on in a basement beneath the shop to the front part of the shop between the hours of 10 30 p.m. and 2 a.m. for the sale of tickets of admission to the club Romer, J. held that the arrangement conferred to estate or interest in the demised premises but was a mere privilege or licence to use portion thereof, the defendant retaining the legal possession of the whole and did not, therefore, constitute a breach of the covenants not to, assign, underlet or part with the demised premises or any part thereof . The Madras High Court also relied on an observation made by Scrutton L.J. to Chaplin v. Smith (1926) 1 KB 198, at p.211, wherein it was-observed: He did not assign; nor did he underlet. He was constantly' on the premises himself and kept the key of them. He did business of his own as well as business of the company. In my view he allowed the company to use the premises while he himself remained in possession of them:' Reliance was also placed on the Treatise of Foa on Landlord and Tenant, 6th Edn. at page. 323, where the law on the subject has been summarized in the following words:-- "The mere act of letting other persons into possession by the tenant, and permitting them to use the premises for their own purposes, is not so long as he retains the legal possession himself, a breach of the covenant:" After considering all these decisions, the High Court of Madras extracted the following principles and came to the conclusion that a mere taking in of partners did not amount to transferring of possession and did not constitute assignment or subletting. Says the Madras High Court:-- "It is clear from the aforesaid decisions that there cannot tie a subletting unless the lessee parted with legal possession: The mere fact that another is allowed to use the premises while the lessee retains the legal possession is not enough to create a sublease. Section 105 of the Transfer of Property Act defines a lease of immovable property as to transfer of right to enjoy such property: Therefore, to create a lease, or sublease a exclusive possession and enjoyment of the property should be conferred on another. In the present case the exclusive possession of the premises was not given to the second respondent. The first respondent continued to be the lessee, though in regard to the business carried on in the premises he had taken in other partners. The partners are not given any exclusive possession of the premises or a part thereof: The first respondent continues to be in possession subject to the liability to pay rent to his landlord. The partnership deed also, as I have already stated, does not confer any such right in the premises on, the other partners. I, therefore, hold in the circumstances of the case the first respondent did not sublet the premises-to the second respondent, and therefore, he is not liable to be evicted under the provisions of Act No:25 of 1949." The view taken by me is reinforced by the opinion expressed by the Madras High Court in the aforesaid decision. A similar view has also been taken by Saurashtra High Court in Karasandas. Ramji v. Karasnji Kalyanji, A I R 1953 Su 113 at pp. 114 and

115. In my opinion, it is, therefore, clear that there has been no assignment or subletting in favour of the partners of the firm by the tenant so as to attract the bar of section 13 (1)(e) of the Rent Act. The view taken by the lower Courts is correct and no exception can be taken thereto."

16. There is no dispute in the legal proposition that there must be parting of the legal possession. Parting of the legal possession means possession with the right to include and also right to exclude others. That is, in' our opinion, is the matter of fact. In this case it has been found that there was a right of possession in favour of the sub-lessee R.C. Abrol & Co. Private Ltd. and right to exclude indeed as it appears from the narration of the fact that the company has gone into liquidation and the official liquidator has taken possession of the premises on behalf of the liquidator and that must be on the basis that it was the asset belonging to the company. In the aforesaid view of the matter we are unable to accept this proposition that there was no subletting.

17. Dr. Shankar Ghosh drew our attention to the observations of the High Court of Delhir in the following three cases:-- Vishwa Nath v. Chainan Lal Khanna, (1977) Ren CJ. 514: (A I R 1975 Delh. 117), Gurdial Singh v. Brij Kishore (1970) 6 Del. L -T

592. Messrs Reliable Finance Corporation (P) Ltd. v. Clearing House and Agencies Pvt. Ltd. (1984) 2 Ren CR 449 (Delhi), Madras Bangalore Transport Co. (West) v. Inder Singh, (1986) 3 SCC 62 (A I R 1986 SC 1564).

18. He contended that in the light of the aforesaid authorities in this, case, there was no parting of legal possession in favour of the sublessee. We are unable to accept this position. In the instant case, exclusive possession was given to the sublessee and the tenant had transferred the right to possess in that portion. It is clear that subletting was done without the consent in writing of the landlord. If that is so, there was inevitable breach of the covenant.

19. In that view of the matter the High Court was right in upholding the order of the Rent Control Tribunal and directing eviction of the appellant. They appeal, therefore, must, fail and is accordingly dismissed.

20. In view of the fact that the appellant has been in possession of the premises for quite some time and to make its arrangement for shifting we direct the decree for eviction shall not be executed before 30-6-1986 provided the appellant files the usual undertaking in this Court within four weeks from today. Mesne profits will be payable from 1st of December, 1987 @ Rs.7,000 per month until the possession is delivered: (1) That the appellant will hand over vacant and peaceful possession of the premises to the respondent on or before 30-6-1988 from today. (2) That the appellant will pay to the respondent arrears of rent, if any, within one month from today. (3) That, the appellant will pay to respondent further compensation for use and occupation of the premises month by month before 10th of every month. (4) That the appellant will not induct any other person in the premises.

21. The Court further directs that in default of compliance with anyone or more of these conditions or if the undertaking is not filed as required within the stipulated time, the decree shall become executable forthwtih. M.B.A./52/F.C. Appeal dismissed.