For claiming protection under section 15-A of the Bombay Rent Act, three requirements are necessary to be proved by licensee :---
(i) the person must be in possession on 1st day of February, 1973 ;
(ii) he must be in occupation of premises or part thereof which is not less than a room, and
(iii) he should be in possession as a licensee.
There is no dispute that the first two conditions are satisfied by defendant No. 1. The question is whether he is a licensee as contemplated by the provisions of section 5(4-A) of the Bombay Rent Actor not? Section 5(4-A) defines 'licensee' as follows :---
"5(4-A) "licensee", in respect of any premises or any part thereof, means the person who is in occupation of the premises or such part, as the case may be, under a subsisting agreement for licence given for a licence fee or charge; and includes any person in such occupation of any premises or part thereof in a building vesting in or leased to a co-operative housing society registered or deemed to be registered under the Maharashtra Co-operative Societies Act, 1960 but does not include a paying guest, a member of a family residing together, a person in the service or employment of the licensor, or a person having and accommodation in a hotel, lodging house, hostel, guest house, club, nursing home, hospital sanatorium, Dharmashala, home for widows, orphans or like premises, marriage or public hall or like premises, or in a place of amusement or entertainment or like institution, or in any premises belonging to or held by any employee or this spouse who or account of the exigencies of service or provision of a residence attached to his of her post or office is temporarily not occupying the premises, provided that he on she charges licence fee or charge for such premises of the employee or spouse not exceeding the standard rent and permitted increases for such premises, and any additional sum for services supplied with such premises, or a person having accommodation in any premises or part thereof for conducting a canteen, crache, dispensary or other services as amenities by any undertaking or institution; and the expressions "licence", "licensor" and "premises given on licence" shall be construed accordingly".
This definition can conveniently be divided into three parts-(1) general; (2) inclusionary part and (3) exclusionary part. In this matter, I am concerned with the exclusionary part. The first part suggests the category of licensees who are in possession and control of the premises entirely. In other words, where a licensor does not retain any control over the premises and the dominant object in creating the license is to give the premises in occupation of the licensee entirely. The third part deals with those cases where possession is not given entirely to other party. It suggests that some control is retained by the licensor over the premises. This part mentions 'a person conducting a running business belonging to the licensor'. In such a case, the dominant object is not to give the premises in possession of the other party but to give the business for running the same and incidentally possession of the premises is handed over. The licensor does not lose his control over the premises entirely. The Chambers 20th Century Dictionary gives the meaning of 'conduct' as follows :---
"to lead or guide, to direct, to manage act or method of leading or managing, escort, management".
Similarly the New World Dictionary of Webster's gives the meaning of 'conduct' as "conducting skill supervising by using by one's executive skill, knowledge or wisdom - the process or way of managing or directing, management, handling."
This indicates that where the licensor primarily wants to take the advantage of the skill of the other party and, therefore, the business is given for the purpose of running, it can be said to be given for conducting. In effect, in all those cases, conductor is put in possession only for the purpose of running in view of his skill. In the present case, I find that it is not the case of the plaintiff that defendant No. 1 was given the business in view of his skill. Further, the premises were given entirely in the control of defendant No. 1. The plaintiff or his father did not retain any control whatsoever either in the premises or in the business. The business run in the shop was of the licensees. The plaintiff has not given one reason or mentioned any motive why the running business was given to defendant No. 1. All this indicates the dominant object in putting the defendant No. 1 in possession was to create licence in respect of the premises and not to give the running business for the purpose of mere conducting. In my view, the business was given in possession of defendant No. 1 incidentally along with certain articles. However, this does not obliterate the real intention and object of the parties i.e., to give the premises on license.
12. In my view, there must be some reason in giving the running business for conducting to the other person such as disability to conduct the business or the intention must be to give the business temporarily in possession of another for some reason. In that case one can say that the business belongs to licensor. If this is not so then the original landlord and licensor can collude to take advantage of shortage of accommodation and share in the benefits by putting the licensee out of reach of the provisions of Bombay Rent Act, or the licensor himself may pocket those benefits and in the process real landlord shall be deprived on the one hand and on the other such licensee shall be deprived of statutory protection completely. However, in both the cases the licensee shall be at the mercy of the other party. The sword of losing possession shall ever remain hanging on his head unless he satisfies the whims and demands of the other party. He may be in possession exclusively for decades and carry on business on his own, but he will have no protection. The very object of giving protection to licensees can be defeated with impunity if this is allowed. The present case can be a good illustration where no reason has been pleaded or pointed out why business was given for conducting. The licensor has acted as middleman only. This is not at all contemplated by the exclusionary clause of section 5(4-A).
13. In my opinion, it is necessary to give restricted meaning to this exclusionary clause contained insection 5(4-A) in view of the object of the Bombay Rent Act. The object of the Act is to give statutory protection to persons who are exclusively in possession of the premises. In fact, section 15-A was introduced by the Maharashtra Act 17 of 1973 with a view to widen protection and to include the licensees who were in possession on 1st February, 1973 of premises which was not less than a room under its protective umbrella. If restricted meaning is not given to this exclusionary clause, then the distinction between the licensee and the persons mentioned in that clause would be blurred and even those who were put in possession of the premises exclusively and doing their own business for years shall be excluded. It is not desirable. It is necessary to consider the dominant object or intention of the parties against the background of all the factors mentioned above. The courts below have failed in this.
14. In my view, the reasons given by the learned Judge of the Court below for holding that defendant No. 1 falls in the exclusionary part i.e., (i) name of the shop was not changed : (ii) some furniture and stock-in-trade was given to defendant No. 1 when he started business in the premises; (iii) the shop license stood in the name of plaintiff and (iv) defendant No. 1 never insisted that rent receipts should be issued in his name, are such that they do not militate against holding the defendant No. 1 as licensee failing in first part and protected. In fact, it was not necessary for defendant No. 1 to change the shop name since business was done in that name for long. He might have taken some furniture and stock-in-trade when started the business instead of buying new one. Further, in view of close relations the shop license might have continued in the name of plaintiff. It is not possible for me to accept these facts as indicating that the defendant No. 1 was a person merely conducting the running business belonging to the licensor and was falling under the exclusionary part of section 5(4-A).
15. In my view, therefore, the defendant No. 1 was a licensee squarely falling within the first part ofsection 5(4-A) and was entitled to get the protection under the Bombay Rent Act in view of section 15-A(i) as he has fulfilled all the three requirements as mentioned above by me.
Bombay High Court
Varisalli Mohammed Ilias vs Abdul Sattar Gulam Hussein (Since ... on 6 August, 1991
citations: 1992 (1) BomCR 27
Bench: P Patankar
1. The question that arises for my consideration in this appeal is whether the appellant is protected under section 15-A of the Bombay Rents, Hotel & Lodging House Rates Control Act, 1947 (hereinafter called Bombay Rent Act)? If protected then admittedly the Civil Court will be having no jurisdiction to decide the suit.
2. A few facts are as follows.
3. There is one Hair Cutting Saloon by name 'Bombay Hair Dressers' situated at 110/2, Shivaji Nagar, in the City of Pune. The structure belonged to one Smt. N.K. Jangi. One shop premises out of it was originally leased out to the father of the plaintiff who was carrying on hair cutting business in the name of 'Bombay Hair Dressers'. Sometime in 1962, the same was given to the defendant No. 1 and the defendant No. 1 went on carrying on the said business till his death and then it is carried on by defendant No. 4. Defendant Nos. 2 to 4 are sons of defendant No. 1.
4. The plaintiff filed special civil suit in the Court of Civil Judge, Junior Division, Pune, for getting possession of the suit premises on the ground that the shop was given to defendant No. 1, as licensee for conducting at the rate of Rs. 200/- per month. Defendant No. 5 has been brought into the shop premises by Defendant No. 2 to Defendant No. 4 and is behaving arrogantly. Defendant No. 1 started claiming right in the shop and, therefore, the plaintiff did not want him to be in possession. The plaintiff also claimed that there are various articles belonging to him in the said shop and he was entitled to get those articles or alternatively an amount of Rs. 2,800/- towards their price.
5. Written statement came to be filed and inter alia it was contended that defendant No. 1. is the real uncle of the plaintiff. The plaintiff's father and the defendant No. 1 stayed together. They formed a joint family which was also having another hair cutting shop by name 'Bengal Hair Dressers'. Thereafter they took the suit premises on rent and started the 'Bombay Hair Dressers'. The tenancy was taken in the name of the plaintiff's father. It was, therefore, contended that the tenancy was a joint tenancy of plaintiff's father and defendant No. 1. It was alternatively contended that defendant No. 1 was independently doing business in the suit premises since last about 15-16 years. The rent of the suit premises was Rs. 21.50. Defendant No. 1 was paying Rs. 121.50 to the plaintiff's father. The plaintiff has no concern whatsoever with the business and he was only original tenant of the premises. In view of the provisions of law, defendant No. 1 got the tenancy rights. Therefore, prayed for dismissal of the suit.
6. The trial Court raised various issues and decreed the suit. The appeal filed was also dismissed and hence this appeal by defendant No. 4.
7. The learned advocate appearing on behalf of the appellant (defendant No. 4) contends that the learned Judge has erred in holding that the original defendant No. 1 does not get protection of section 15-A of the Bombay Rent Act. In his submission, the defendant No. 1 was the licensee in possession of one room exclusively on 1-2-1973. One license was not terminated and, therefore, he was entitled to be protected and it was an error to hold that he was merely conductor of the business and, therefore, excluded under the definition of licensee as contained in section 5(4-A) of the Bombay Rent Act.
8. The learned advocate appearing on behalf of the respondent No. 1 (plaintiff) supports the decree passed by the Court below and further contends that there is no substantial question of law involved in the second appeal and, in any case, as the defendant No. 1 contended that there was a joint tenancy of plaintiff and defendant No. 1, defendant No. 1 was estopped from contending that he was a licensee of the suit premises protected by the Bombay Rent Act. According to him, such a plea cannot be raised in view of section 116 of the Evidence Act.
9. It is admitted that there was no written agreement between the plaintiff and defendant No. 1. There is no dispute regarding the relationship between the plaintiff and defendant Nos. 1 to 4. It is not in dispute that the premises were leased to plaintiff's father originally. It is also not in dispute that defendant No. 1. was carrying on business in the suit premises exclusively since about 1962. It is not in dispute that the license stood in the name of the plaintiff, and when the defendant No. 1. started running the business, certain furniture was given. It is also not in dispute that defendant No. 1 did not change the name of the Saloon i.e. Bombay Hair Dressers. In my view it is not possible to infer from these admitted facts that there was no license created in favour of defendant No. 1 in respect of suit premises by plaintiff's father and the licence was created merely for the purpose of conducting business.
10. In the plaint itself, the plaintiff has mentioned in para 4 that the shop was given to defendants 1 to 4 as licensees at the rate of Rs. 200/- and it was given for conducting under the agreement. However, the terms and conditions thereof were not pleaded nor any evidence adduced. In the evidence adduced, plaintiff has stated as follows:---
"My father gave suit shop to defendant No. 1 only to run the business.....Defendants were to pay Rs. 121.50 as licence fee to my father. They are paying amount since last many years. Now licence fee increased to Rs. 200/- p.m.....Defendants were paying licence fee. After paying licence fee they were running shop. They were paying licence fee after 1963.....Defendants were paying licence fee till this suit was filed."
Now considering this, it can be very well said that the premises were given to defendant No. 1 for running his own business by charging license fee and defendant No. 1. was running his business since 1963.
11. For claiming protection under section 15-A of the Bombay Rent Act, three requirements are necessary to be proved by licensee :---
(i) the person must be in possession on 1st day of February, 1973 ;
(ii) he must be in occupation of premises or part thereof which is not less than a room, and
(iii) he should be in possession as a licensee.
There is no dispute that the first two conditions are satisfied by defendant No. 1. The question is whether he is a licensee as contemplated by the provisions of section 5(4-A) of the Bombay Rent Actor not? Section 5(4-A) defines 'licensee' as follows :---
"5(4-A) "licensee", in respect of any premises or any part thereof, means the person who is in occupation of the premises or such part, as the case may be, under a subsisting agreement for licence given for a licence fee or charge; and includes any person in such occupation of any premises or part thereof in a building vesting in or leased to a co-operative housing society registered or deemed to be registered under the Maharashtra Co-operative Societies Act, 1960 but does not include a paying guest, a member of a family residing together, a person in the service or employment of the licensor, or a person having and accommodation in a hotel, lodging house, hostel, guest house, club, nursing home, hospital sanatorium, Dharmashala, home for widows, orphans or like premises, marriage or public hall or like premises, or in a place of amusement or entertainment or like institution, or in any premises belonging to or held by any employee or this spouse who or account of the exigencies of service or provision of a residence attached to his of her post or office is temporarily not occupying the premises, provided that he on she charges licence fee or charge for such premises of the employee or spouse not exceeding the standard rent and permitted increases for such premises, and any additional sum for services supplied with such premises, or a person having accommodation in any premises or part thereof for conducting a canteen, crache, dispensary or other services as amenities by any undertaking or institution; and the expressions "licence", "licensor" and "premises given on licence" shall be construed accordingly".
This definition can conveniently be divided into three parts-(1) general; (2) inclusionary part and (3) exclusionary part. In this matter, I am concerned with the exclusionary part. The first part suggests the category of licensees who are in possession and control of the premises entirely. In other words, where a licensor does not retain any control over the premises and the dominant object in creating the license is to give the premises in occupation of the licensee entirely. The third part deals with those cases where possession is not given entirely to other party. It suggests that some control is retained by the licensor over the premises. This part mentions 'a person conducting a running business belonging to the licensor'. In such a case, the dominant object is not to give the premises in possession of the other party but to give the business for running the same and incidentally possession of the premises is handed over. The licensor does not lose his control over the premises entirely. The Chambers 20th Century Dictionary gives the meaning of 'conduct' as follows :---
"to lead or guide, to direct, to manage act or method of leading or managing, escort, management".
Similarly the New World Dictionary of Webster's gives the meaning of 'conduct' as "conducting skill supervising by using by one's executive skill, knowledge or wisdom - the process or way of managing or directing, management, handling."
This indicates that where the licensor primarily wants to take the advantage of the skill of the other party and, therefore, the business is given for the purpose of running, it can be said to be given for conducting. In effect, in all those cases, conductor is put in possession only for the purpose of running in view of his skill. In the present case, I find that it is not the case of the plaintiff that defendant No. 1 was given the business in view of his skill. Further, the premises were given entirely in the control of defendant No. 1. The plaintiff or his father did not retain any control whatsoever either in the premises or in the business. The business run in the shop was of the licensees. The plaintiff has not given one reason or mentioned any motive why the running business was given to defendant No. 1. All this indicates the dominant object in putting the defendant No. 1 in possession was to create licence in respect of the premises and not to give the running business for the purpose of mere conducting. In my view, the business was given in possession of defendant No. 1 incidentally along with certain articles. However, this does not obliterate the real intention and object of the parties i.e., to give the premises on license.
12. In my view, there must be some reason in giving the running business for conducting to the other person such as disability to conduct the business or the intention must be to give the business temporarily in possession of another for some reason. In that case one can say that the business belongs to licensor. If this is not so then the original landlord and licensor can collude to take advantage of shortage of accommodation and share in the benefits by putting the licensee out of reach of the provisions of Bombay Rent Act, or the licensor himself may pocket those benefits and in the process real landlord shall be deprived on the one hand and on the other such licensee shall be deprived of statutory protection completely. However, in both the cases the licensee shall be at the mercy of the other party. The sword of losing possession shall ever remain hanging on his head unless he satisfies the whims and demands of the other party. He may be in possession exclusively for decades and carry on business on his own, but he will have no protection. The very object of giving protection to licensees can be defeated with impunity if this is allowed. The present case can be a good illustration where no reason has been pleaded or pointed out why business was given for conducting. The licensor has acted as middleman only. This is not at all contemplated by the exclusionary clause of section 5(4-A).
13. In my opinion, it is necessary to give restricted meaning to this exclusionary clause contained insection 5(4-A) in view of the object of the Bombay Rent Act. The object of the Act is to give statutory protection to persons who are exclusively in possession of the premises. In fact, section 15-A was introduced by the Maharashtra Act 17 of 1973 with a view to widen protection and to include the licensees who were in possession on 1st February, 1973 of premises which was not less than a room under its protective umbrella. If restricted meaning is not given to this exclusionary clause, then the distinction between the licensee and the persons mentioned in that clause would be blurred and even those who were put in possession of the premises exclusively and doing their own business for years shall be excluded. It is not desirable. It is necessary to consider the dominant object or intention of the parties against the background of all the factors mentioned above. The courts below have failed in this.
14. In my view, the reasons given by the learned Judge of the Court below for holding that defendant No. 1 falls in the exclusionary part i.e., (i) name of the shop was not changed : (ii) some furniture and stock-in-trade was given to defendant No. 1 when he started business in the premises; (iii) the shop license stood in the name of plaintiff and (iv) defendant No. 1 never insisted that rent receipts should be issued in his name, are such that they do not militate against holding the defendant No. 1 as licensee failing in first part and protected. In fact, it was not necessary for defendant No. 1 to change the shop name since business was done in that name for long. He might have taken some furniture and stock-in-trade when started the business instead of buying new one. Further, in view of close relations the shop license might have continued in the name of plaintiff. It is not possible for me to accept these facts as indicating that the defendant No. 1 was a person merely conducting the running business belonging to the licensor and was falling under the exclusionary part of section 5(4-A).
15. In my view, therefore, the defendant No. 1 was a licensee squarely falling within the first part ofsection 5(4-A) and was entitled to get the protection under the Bombay Rent Act in view of section 15-A(i) as he has fulfilled all the three requirements as mentioned above by me. In view of this position, the Civil Court will have no jurisdiction to decide the suit in view of section 28 of the said Act.
16. Mr. Govilkar submits that the defendant No. 1 claimed joint tenancy in the written statement. It is contended that it was claimed that the tenancy was taken both by the plaintiff's father and defendant No. 1 and by implication defendants have denied the right and title of the plaintiff. He invited my attention to the contents of para 3 of the written statement in which it was contended that the suit premises are not tenanted to the plaintiff's father alone. According to him, in view of section 116 of the Evidence Act, the defendant No. 1 was estopped from contending that he was licensee of the suit premises. He relied on the judgment of this Court in A.I.R. 1960 Bom. 238, Uttam Gulabrao Sakhare v. Champatrao Gulabrao Gawande. It is not possible for me to accept this contention. The contention raised by the defendant No. 1 does not suggest the denial of title or right of the plaintiff in respect of the suit premises. He has merely contended that plaintiff's father and defendant No. 1 were living jointly as they were brothers. The tenancy was taken jointly in the name of the plaintiff's father and defendant No. 1. Even in the alternative contention, it is not contended that the plaintiff was not entitled to create the license when the premises were put in possession of defendant No. 1. In view of this, the provisions of section 116 of the Evidence Act are not at all attracted and the defendant No. 1 is not estopped from taking the alternate contention that he was the licensee of the suit premises protected by the provisions of the Bombay Rent Act. Mr. Govilkar only wanted to rely on the head-note (b) of the said judgment and concedes that the facts are totally different of the said reported ruling. Head-note (b) is "The rule that tenant cannot deny his landlord's title extends to the case of a person coming in by permission as licensee." There is no dispute as regards this proposition. However, as the facts of this case are totally different, the ratio of the said judgment is not at all attracted. The said case mainly dealt with point whether a third party was a necessary party to the suit or not. In the said case, the landlord A filed suit against B alleging that he was his tenant. B contended that A was not his landlord but somebody else. The question arose whether the said somebody else was necessary party to the suit or not.
17. Mr. Govilkar then contended that this being the second appeal, there should be a substantial question of law involved and in the present case, there is no substantial question of law involved since the only question was whether the defendant No. 1 was a licensee or whether running business was given to him for the purpose of conducting? He relied on , Sir Chunilal V. Mehta and Sons Ltd. v. Century Spinning and Manufacturing Co. Ltd. The Supreme Court was considering what is substantial question of law as stated in Article 133(1)(a) of the Constitution of India and section 110 of the C.P.C and the Supreme Court laid down the broad test which is as follows :---
"We are in general agreement with the view taken by the Madras High Court and we think that while the view taken by the Bombay High Court is rather narrow the one taken by the former High Court of Nagpur is too wide. The proper test for determining whether a question of law raised in the case is substantial would, in our opinion, be whether it is of general public importance or whether it directly and substantially affects the rights of the parties and if so whether it is either an open question in the sense that it is not finally settled by this Court or by the Privy Council or by the Federal Court or is not free from difficulty or calls for discussion of alternative views. If the question is settled by the highest Court or the general principles to be applied in determining the question are well settled and there is a mere question of applying those principles or that the plea raised is palpably absorb the question would not be a substantial question of law."
He further relied upon , Prabirendra Nath Nanday and another v. Narendra Nath Nanday. In para 7 it was observed as follows :---
"The finding of the courts below that the respondent was a licensee of appellants' predecessor-in-interest Bhabani Nath Nandy being a finding of fact and being based upon a consideration of the evidence adduced by the parties, is not open to challenge in this second appeal."
It was a case in which the question was whether the defendant was a licensee under the Specific Relief Act? In the present case, I am concerned with whether defendant No. 1 is protected by the provisions of the Bombay Rent Act or not. If the defendant No. 1 falls under section 15-A, then he is protected. Therefore, in my view, this involved substantial right of a person. That right is directly involved for consideration. It concerned defendant No. 1's livelihood. In my view, there is substantial question of law since it is required to be considered whether statutory protection is extended to the defendant No. 1 or not. The provisions are required to be interpreted. Further, on the face of it, the considerations which weighed with the courts below in depriving defendant No. 1 from statutory protection of the Rent Actare totally erroneous. In my view, the plaintiff has totally failed to prove that the defendant No. 1 was falling within the exclusionary part of section 5(4-A) of the Bombay Rent Act and, therefore, not eligible to get the protection of section 15-A.
18. The original defendant No. 1 has expired. Defendants 2 to 4 are his sons and defendant No. 4 is carrying on business in the suit premises after the death of defendant No. 1. Therefore , now he would be entitled to protection under the Bombay Rent Act.
19. In the result, the appeal is allowed. The impugned judgment and decree dated 20th September, 1988 passed by the 7th Additional District Judge, Pune in Civil Appeal No. 1233 of 1987, arising out of the judgment and decree dated 25th November, 1987 passed by the 4th Joint Civil Judge, Junior Division, Pune in Regular Civil Suit No. 1034 of 1978, is set aside. The suit of the plaintiff bearing Regular Civil Suit No. 1034 of 1978 is dismissed as regards the prayer for possession of the suit premises. However, the decree directing the defendants to return the articles as mentioned in the schedule appended to the plaint or their cost of Rs. 2,000/- is retained. In the facts and circumstances, there shall be no order as to costs.
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