w w w . L a w y e r S e r v i c e s . i n



Zodiac Investment Limited v/s Durga Investment and Trading Co.

    F.M.A.T. Appeal No. 2425 of 1987

    Decided On, 14 March 1988

    At, High Court of Judicature at Calcutta

    By, THE HONOURABLE MR. JUSTICE A.M. BHATTACHARJEE & THE HONOURABLE MR. JUSTICE AJIT KUMAR NAYAK

    For the Appearing Parties: Ramesh Jain, S.K. Mullick, Saktinath Mukherjee, Sudhis Das Gupta, Tapan Kumar Mitra, Advocates.



Judgment Text

A.M. BHATTACHARJEE, J.


(1) THE respondent-landlord has obtained a decree for ejectment against its tenant and the appeal by the tenant against that decree is now pending in this Court. The two appellants in these two appeals have now filed two suits challenging that decree is not binding on them on the allegation that the two disputed premises have been lawfully sub-let to them by the tenant and they have filed applications for orders of temporary injunction restraining the superior landlord, the respondent, from proceeding with execution of that decree and from dispossessing them or disturbing their possession in any way in execution thereof. The applications have been rejected by the Trial Court and being aggrieved thereby these two appeals have been preferred by the two sub-tenants which are being disposed of by this common judgment.


(2) THE appellants/sub-tenants being admittedly in possession of the disputed premises and carrying on business there, it can not be disputed that if (and only if) they have been able to make out a prima facie case in their favour requiring consideration, then, according to the well-established principles governing temporary injunctions, which have almost become platitudinous during all these centuries, temporary injunctions should be granted for maintenance of status quo ante because if they are not granted and the appellants are thrown out of possession during the pendency of their Suits, the injury they would suffer would be irreparable. We think that there should be no doubt that between a person claiming right to possession being thrown out of possession and a person entitled to recover possession being temporarily restrained from recovering possession for the time being, balance of convenience and inconvenience is in favour of the former and against the latter. That being the position, the only question that would require our consideration in these two appeals is whether the appellants have been able to make out such a prima facie case as would reasonably require consideration by the Trial Court.


(3) ADMITTEDLY a decree for eviction has been passed against the tenant of the first decree under whom the appellants claim to be sub-tenants. Under the general law of landlord and tenant, a tenant, in the absence of a contract to the contrary, is entitled to sub-let the tenanted premises, but a decree for ejectment against the tenant would bind the sub-tenant. But Section 14 of the West Bengal Premises Tenancy Act, which governs the cases at hand, however, prohibits sub-letting by the tenant without the previous consent in writing of the landlord and Section 13 (1) (a) makes such unauthorised sub-letting a ground for ejectment of the tenant and Section 13 (3) provides that in ejectment decree passed on such ground would be binding on the sub-tenant. But even when the sub-letting has been made by the tenant with the previous consent in writing of the landlord, Section 16 (1) requires both the tenant and the sub-tenant to notify to the landlord the creation of such sub-tenancy within one month from the date of such sub-letting. And only when it is so done, Section 13 (2) would require every such sub-tenant to be made a party to the Suit for ejectment by the superior landlord against his immediate tenant, implying thereby that the decree for ejectment passed in any Suit by the superior landlord against the immediate tenant would not be binding on such a sub-tenant who was not made a party to that Suit.



4) THE appellants have urged that their landlord, i. e. , the tenant of the first degree, had the previous written consent of its landlord to sub-let the premises and reliance has been placed by them on Clause 7 of the agreement of tenancy between the superior landlord and the tenant of the first degree which is as hereunder :


"that you will not be entitled to sub-let the said tenancy or any portion thereof under any circumstances. However, you may accommodate your sister concerns therein".


Assuming arguendo that the appellants are the sister concerns of the tenant of the first degree and that the provisions quoted above authorised the tenant of the first degree to sub-let the tenancy to and in favour of the appellants, it has been conceded that neither the appellants nor their landlord, the tenant of the first degree, notified the creation of these sub-tenancies in accordance with the provisions of Section 16 and that being so, the appellants were not required under Section 13 (2) to be made parties to the Suit for ejectment by the superior landlord against the tenant of the first degree and, therefore, the decree passed therein would be, under the provisions of Section 13 (3), binding on the appellants. It has been pointed out on behalf of the respondent/landlord that since according to the definition of the expression "tenant" as in Section 2 (h), a tenant "shall not include any person against whom any decree or order for eviction has been made by a Court of competent jurisdiction", the tenant of the first degree has ceased to be a tenant with the passing of the decree in the ejectment suit filed by the superior landlord, the respondent and that the tenant of the first degree, i. e. , the landlord of the appellants/sub-tenants, having thus ceased to be a tenant with the passing of the ejectment decree, which is also binding on the appellants/sub-tenants under Section 13 (3), the latter as the plaintiffs can have no prima facie case for consideration to enable them to have any Order of injunction in their favour against the said decree for ejectment.


(5) AS has been recently pointed out by one of us in a Division Bench decision of this Court in Madhu Jayanti vs. Roger's Engineering (1987- 1 Calcutta High Court Notes 237 at 240), even if the sub-tenancies in favour of the plaintiffs-appellants were made without the prior consent in writing of the superior landlord and were thus made in violation of Section 14 of the West Bengal Premises Tenancy Act prohibiting such sub-letting without such consent, there would still be legal relationship of landlord and tenant between the appellants and their landlord, the tenant of the first degree, even though such sub-tenancies were not binding on the superior landlord and were voidable at its instance. This must now be taken to be the settled law in view of a rather recent decision of a three-Judge Bench of the Supreme Court in Nanakram vs. Kundalrai (A. I. R. 1986 S. C. 1194), which has approved an earlier two-Judge Bench decision of the Supreme Court in Murlidhar vs. State of Uttar Pradesh (A. I. R. 1974 S. C. 1924). Reference may also be made to an earlier Division Bench decision of this Court in Debabrata vs. Kalyan (1981 - 1 Calcutta High Court Notes 497), which has also relied inter alia on the earlier Supreme Court decision in Murlidhar (supra).


(6) WE must, therefore, proceed on the basis that even if the sub-tenancies in favour of the appellants/sub-tenants have been made in violation of Section 14 of the West Bengal Premises Tenancy Act and have not been notified in accordance with the provisions of Section 16, the sub-tenants nevertheless have a lawful jural relation of landlord and tenant with their landlord, the tenant of the first degree. It may, therefore, be urged that if the said tenant of the first degree has still the lawful right to challenge and resist a decree for eviction and is exercising that right by filing an appeal in this Court which is still pending, then the sub-tenants of that tenant. , i. e. , the appellants, should also be held to have a legal right to protect their sub-tenancies against the execution of the said decree so long the said appeal by the tenant of the first degree is pending.


(7) IT has, however, been urged that there being already a decree for eviction against the tenant of the first degree, it has already ceased to be a tenant in view of Section 2 (h) of the West Bengal Premises Tenancy Act, which excludes from the category of tenant any person against whom a decree for eviction has been passed and, therefore, the tenancy in favour of the tenant of the first degree having thus come to an end, these sub-tenants, the appellants, can no longer have any right or locus standi to resist, execution of that decree passed against their landlord, the tenant of the first degree.


(8) BUT does a tenant cease to be a tenant and his tenancy comes to an and with the passing of a decree for eviction by the Trial Court, even though the decree is still under challenge in appeal ? According to Mr. Dasgupta, the learned Counsel appearing for the superior landlord, the respondent, the answer must be in the affirmative in view of Section 2 (h) of the West Bengal Premises Tenancy Act and he has urged that a tenant ceases to be a tenant the moment the decree for eviction is passed by the Trial Court and the pendency of any appeal from that decree can not alter the position and Mr. Dasgupta has relied on two single-judge decisions in Kanilal vs. Kanailal (67 Calcutta Weekly Notes 334) and in Lakpat Rai vs. Radheyshyam (69 C. W. N. 858), a Division Bench decision in Radharani vs. Angurbala (67 C. W. N. 501) and the Special Bench decision in Sriniwas vs. Madanlal (A. I. R. 1973 Calcutta 13) as authorities for this proposition.


(9) IN the Division Bench decision in Radharani (supra, 67 C. W. N. 501), the suit for ejectment was dismissed by the Trial Court, but on appeal to this Court by the landlord the suit was remanded to the Trial Court for further consideration. After such remand, the landlord applied to the Trial Court for an Order under Section 17 (3) striking out the defence of the tenant and that application having been dismissed, the landlord moved this Court in revision. And all that was decided by learned Judges in their separate but concurring judgments was that the obligation of the tenant-defendant to go on making deposits under Section 17 (1) ceased during the pendency of the appeal and was to arise again only from the date of re-admission of the Suit by the Trial Court after remand. It should be noted that even though the suit for ejectment was dismissed at the first trial and the tenant-defendant, therefore, continued to be a tenant as there was no decree for eviction passed against him within the meaning of Section 2 (h), it was accepted by both the learned Judges that the tenant-respondent, though continuing as tenant, was not required to comply with Section 17 (1) at the appellate stage and as was pointed out by R. N. Dutta, J. in his separate judgement (at 503, 504), there could be no obligation on the part of the tenant-respondent to comply with Section 17 (1) during the pendency of the appeal. It is true that in the course of his separate judgement the learned Judge observed at one stage (at 504) that "if the suit is dismissed, the tenant continues to be a tenant, but if decreed, he ceases to be a tenant". But since the Division Bench was dealing with a case where the suit for eviction against the tenant was dismissed and not decreed, the observation as to the tenant ceasing to be a tenant on the suit being decreed was absolutely unnecessary in that case and can not, therefore, be regarded to be a part of the decidendi. For, as the learned Judge pointed out further, whether the suit for eviction against the tenant is decreed or dismissed, "the suit ceases to be pending after such disposal and operation of sub-section (1) comes to an end" and that whether the Suit is decreed or dismissed, "during the pendency of the appeal, there is no liability to deposit rent under the sub-section (1)". The real decidendi of the Division Bench decision in Radharani (supra), "therefore, is not that a tenant-appellant is not required to comply with Section 17 (1) because of his ceasing to be a tenant as a result of the decree for ejectment, as there was in fact no such decree in that case, but that whether a suit for eviction is decreed or dismissed, the tenant; either as the appellant or as the respondent in any appeal from such decision, is no longer required to comply with Section 17 (1) once the suit has been disposed of in one way or the other in the Trial Court. In view of what was actually decided and was required to be decided by the Division Bench in Radharani (supra), we do not think that we can still treat the same as any authority for the view that a tenant ceases to be a tenant for all purposes immediately with the passing of a decree for eviction against the tenant in the Trial Court, even though an appeal against the said decree is pending before a Competent Appellate Court.


(10) THE Special Bench decision in Sriniwas vs. Madanlal (supra, A. I. R. 1973 Calcutta 13) has also had to consider the question as to whether a tenant, against whom a decree for eviction was passed, was under any obligation to make or continue to make any deposit under Section 17 (1) during the period of the appeal from that decree and the Special Bench has returned a unanimous answer in the negative. But what is to be noted is that the Special Bench, as will appear from paragraph 6 of the judgment, in coming to the decision has mainly relied on the words and expressions used in Section 17 (1) and has ruled that considering the scheme of the Section and construing the various expressions used, therein, the tenant-appellant, who has suffered a decree for ejectment, can not be under any liability to comply with Section 17 (1) during the currency of the appeal from that decree. The Special Bench has observed thus :


"it is important to emphasise that the liability to deposit under Section 17 (1) for the purpose of obtaining benefit of protection against eviction is imposed upon the tenant within one month of the service of the writ of summons on him or where he appears in a suit or proceeding without the writ of summons being served upon him, within one month from his appearance. In a case for instance, where, the landlord has succeeded in the Trial Court and an appeal is preferred by the tenant this condition cannot be fulfilled without doing unnecessary strain to the language of the sub-section (1) of S. 17. Will the tenant in that case be liable to deposit rent even though he has preferred an appeal, within one month from the filing of the appeal ? Again in a case where the landlord files an appeal, when will the liability to deposit the rent in terms of section 17 (1) during the pendency of the appeal arise ? Will it be from the date of the service of the notice of appeal ? Unless the expression "date of the service of the writ of summons" is read in those cases as either date of filing of the appeal or "date of the service of the notice of appeal" obligation under sub-section (1) of S. 17 cannot be insisted on a tenant during the pendency of the appeal. That, in our opinion, would be doing undue strain to the language used in the statute. We find no justification in the scheme or the purpose of the Act to warrant such straining of language. "


(11) READING those observations in the context of the judgment of the Special Bench as a whole, it appears that the ratio of its decision is not that a tenant-appellant is not required to comply with Section 17 (1) during the appeal because he has ceased to be a tenant immediately with the passing of the impugned decree for eviction passed by the Trial Court, but that in view of the scheme of the Section, the express conditions laid down for its compliance, and the various expressions used therein, the Section is not at all in- tended to apply at the appellate stage.


(12) THE two single-Judge decisions in Kanailal (supra, 67 C. W. N. 334) and in Lakpat Rai (supra, 69 C. W. N. 858), have however, proceeded on the basis that once a decree for eviction has been passed against the tenant in the Trial Court, he ceases to be a tenant as defined in Section 2 (h) of the West Bengal Premises Tenancy Act and, having thus ceased to be a tenant, is no longer required to comply with the provisions of Section 17 (1) during the appeal from that decree or a proceeding to set aside. the decree when passed ex parte as, according to those decisions, Section 17 (1) can apply to tenants only. As we have already indicated, the reason for which Section 17 (1) would not apply to a tenant-appellant in an appeal against the ejectment decree passed against him is not that he has ceased to be a tenant as a result of the ejectment decdee, but that even if he continues as a tenant, Section 17 (1), on its terms can apply only during the pendency of the Suit at the Trial Court and that is, in our view, what has been decided by the Division Bench in Radharani (supra) and the Special Bench in Sriniwas (supra). As owe have been already pointed out, even where the suit for eviction has been dismissed and the tenant has not thus ceased to be a tenant, he is not required to comply with Section 17 (1) during the appeal which the landlord may prefer against the dismissal of a suit for eviction. We are inclined to think that the Division Bench decision in Radharani (supra) and the Special Bench decision in Sriniwas (supra) are no authorities for the proposition that the tenant ceases to be a tenant for all purposes immediately with the passing of the decree for eviction against him by the Trial Court and, therefore, prosecutes his appeal against the decree for eviction as a trespasser, so to say.


(13) WE do not, as we cannot, dispute that in view of the provisions of Section 2 (h) of the West Bengal Premises Tenancy Act, a tenant would cease to be a tenant when a decree for eviction is passed against him. But the question that would require serious consideration in these suits is whether the tenant, when he is prosecuting an appeal challenging that decree, would still be regarded to have ceased to be a tenant for all purposes. The decision of the Supreme Court in Lakhmi Chand vs. Kauran Debi (A. I. R. 1966 S. C. 1003) does not help us in deciding that question because in that case the tenant, against whom a decree for eviction was passed, challenged the said decree in the appellate court and then in revision in the High Court, but all without success. Section 2 (1) of the Delhi Rent Control Act governing the case also provided that a tenant does not include any person against whom a decree or Order for eviction has been passed. It appears, however, that the Authority concerned under the Slum Areas (Improvement and Clearance) Act, 1956 refused to grant sanction to execute the said decree and the said decree, therefore, became inexecutable for the time being and it was accordingly urged that the decree having thus become inexecutable for the time being and it was accordingly urged that the decree having thus became inexecutable for the time being, the tenant did not cease to be a tenant in spite of the decree. It is true that this contention was repelled by the Supreme Court; but it shou1d be noted that in that case the appeal and. also the revision against the decree for eviction already failed and, therefore, the question as to the status of a tenant during the pendency of an appeal against a decree for ejectment did not arise for consideration.


(14) MR. Mukherjee, the learned Counsel appearing for the appellants, has very strongly urged that while a decree for eviction against a tenant would divest him of his status as a tenant, such a decree must be final one and that once an appeal is filed and is pending against such decree, the decree would be deprived of its final character during the pendency of the appeal and cannot, therefore, during the pendency of the appeal, make the tenant cease to be a tenant. Mr. Mukherjee has placed strongest possible reliance on the following observations in the Division Bench decision of this Court in Satyanarayan Prosad vs. Diana Engineering (55 C. W. N. 509 at 514) :


" A decision liable to appeal may be 'final' until the appeal is preferred. But once the appeal is filed the decision loses its character of 'finality' and what was once res judiceta against becomes res sub judice, that is, matter under judicial inquiry. The appeal destroys the finality of the decision, the decree of the Lower Court is superseded by the decree of the Appellate Court. In other words, once an Appeal is filed from a decree or order in a matter, it becomes a pending matter. "


(15) IT was held in that case that a proceeding, even though finally disposed of by the court below, becomes a "pending proceeding" once an appeal is filed therefrom. We have given our serious consideration to these observations coming, as they do, from a Bench consisting of Sri Arthur Trevor Harries, C. J. , and Banerjee, J. In an old Madras Division Bench decision in Chengalavala Gurraju vs. Madapathy Venkateswara (A. I. R. 1917 Madras 597), Sir William Ayling and Kumarswami Sastri, JJ. , also observed that "there can be little doubt that an appeal is only a continuation of the original proceeding, the decree passed by the appellate court being the decree in this suit. . . . . . and that on filing of an appeal the judgement ceases to be res judicata and becomes sub judice". In Praduman Kumar vs. Virendra Goyal (A. I. R. 1969 S. C. 1349} , the Supreme Court has construed (at 1351) the expression "the hearing of the Suit" to include the hearing of the appeal, "an appeal being a rehearing of the suit". In Garikapati vs. N. Subbiah Chowdhury (A. . I. R. 1957 S. C. 540} it has been held (at 553) by a Constitution Bench of the Supreme Court, speaking through S. R. Das, C. J. , that "the legal pursuit of a remedy, Suit, appeal and second appeal are really but steps in a series of proceedings all connected by an intrinsic unity and are to be regarded as one legal proceeding. "


(16) NOW, if, as held by this Court in Satyanarayan Prosad (supra), on the filing of an appeal the decree appealed from loses its character of finality and becomes pending matter, then it may be urged by a tenant appealing against a decree for eviction that the decree has lost its finality and has become a pending matter and is no longer a decree to deprive him of his status of tenant pending the hearing of the appeal and that, as held by the Supreme Court in Garikapati (supra), the one and the same legal proceeding relating to his eviction is still continuing. A Division Bench of the Madhya Pradesh High Court in Bhimandas vs. Nagibai (A. I. R. 1980 NCC 149) appears to have taken such a view in a case under the Madhya Pradesh Accommodation Control Act, 1961, Section 2 (i) whereof also has defined a tenant "not to include any person against whom any order or decree for eviction has been made" and it appears to have been held by the Division Bench that "the person sought to be excluded by the definition is one against whom the order or decree for eviction has attained finality and not one who has challenged the Order or Decree for eviction, as the case may be, before the higher Court. "


(17)


It may, however, be urged that if an appeal simpliciter divests the decree of its final character during the pendency of the appeal and renders the matters decided by the decree to be pending matters and res sub judice, then an appeal by itself should operate as a stay of the decree under appeal. But the law on the point is obviously otherwise as Rule 5 (1) of Order 41 of the Code of Civil Procedure declares that "an appeal shall not operate as a stay of the proceeding under the decree appealed from except so far as the appellate court may direct".


(18) BE that as it may, the observations of the Supreme Court in Gojer Brothers vs. Ratan Lal Singh (A. I. R. 1974 S. C. 1380) and also in the various earlier decisions referred to and relied on therein would go to show that the observations in the Division Bench decision of this Court in Satyanarayan Prosad (supra), extracted hereinbefore, require consideration. It has been pointed out in Gojer Brothers (supra) that once an appeal is filed against a decree, the appellate court would have to confirm, modify or reverse the decree and that and in all these cases the operative decree would be the decree of the appellate court, not only when it reverses or modifies the decree, but even when it confirms it and the decree under appeal would lose its identity and it may be urged that these observations in Gojer Brothers (supra) go to lend considerable support to the observations of this Court in Satyanarayan Prosad (supra) that on an appeal from a decree the matters covered and decided by the decree become "pending matters" and the decree shall obviously stand displaced by the appellate decree, in whichever wa

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y the appeal is eventually decided. (19) IN these two appeals from the orders refusing temporary injunctions, we are not deciding these questions which will have to be determined finally in the Suit. But all that we have endeavoured to demonstrate is that in view of the pendency of the appeal against the decree for eviction against the tenant of the first degree, i. e. , the landlord of the appellants sub-tenants, there are questions, as discussed, hereinabove, which would require careful consideration by the Trial Court and the plaintiffs should, therefore, be regarded to have made out a case to go to trial and a prima facie case for maintenance of status quo during the Trial. (20) MR. Dasgupta has drawn our attention to the fact that in the appeal filed by the tenant of the first degree against the decree for eviction obtained by its landlord, this Court has rejected the application for stay filed by the tenant of the first degree more than once. But it appears from the certified copies of the orders handed over to us that stay was declined on the ground that incorrect and untrue statements were made by the tenant of the first degree in it applications for stay. We are afraid that if, after finding that the plaintiffs/sub-tenants have made out a prima facie case for consideration and would suffer irreparable injury if injunctions are no granted, we still decline injunctions solely on the ground that Order for stay of execution were refused to their landlord, the tenant of the first degree, in its appeal pending in this Court on the ground of its making incorrect and untrue statements therein, we would be writing another story of "the Lamb and the Wolf" of Aesop Fables. The sub-tenants can not obviously be denied reliefs in their cases only on the ground that their landlord made false statements before the Court while pursuing its own case and was accordingly refused interlocutory relief. (21) WE would accordingly allow the appeals and set aside the impugned Orders of the Court below rejecting the applications for temporary injunction filed by the appellants and would pass orders in both the suits restraining the defendants from recovering possession of the suit-premises from the appellants in execution of the decree passed in the Ejectment Suit No. 1169 of 1984 till the disposal of these two Suits or till the disposal of the Appeal from the Original Decree No. 229 of 1985 pending in this Court, whichever is earlier, We would also direct the Trial Court to dispose of the two Suits filed by the appellants as expeditiously as possible and at any rate within six months from the date of communication of this Order to that Court. No costs. Appeal allowed. Ajit Kumar Nayak, J. , I agree
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