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Supreme Court of India
Davesh Nagalya (D) vs Pradeep Kumar (D) Thr.Lrs. on 10 August, 2021Author: Hemant Gupta
Bench: Hemant Gupta, A.S. Bopanna
Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 3477 OF 2010
DAVESH NAGALYA (D) & ORS. …..APPELLANT(S)
VERSUS
PRADEEP KUMAR (D) THR. LRS. AND ORS. …..RESPONDENT(S)
JUDGMENT
HEMANT GUPTA, J.
1. The challenge in the present appeal is to an order passed by the
High Court of Uttarakhand in Review Application No.105/2008 on
23.04.2008 wherein the factum of death of Pradeep Kumar, the
successor-in-interest of Tika Ram – the tenant, was not considered.
The argument of the appellant was that the partnership between
Pradeep Kumar and Subhash Chand, Respondent No.4 herein has
come to an end automatically on the death of Pradeep Kumar on
21.05.2004. Therefore, tenancy also has come to an end in view of
Section 12 (2) of U.P. Urban Buildings (Regulation of Letting, Rent
Signature Not Verified
and Eviction) Act, 19721. It may be stated that during the pendency
Digitally signed by R
Natarajan
Date: 2021.08.10
of the present appeal, Subhash Chand, another partner, who was
17:33:56 IST
Reason:
1 Hereinafter referred to as the “Act”
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allowed to enter into partnership with Pradeep Kumar by the
District Magistrate also died on 25.6.2014.
2. The legal heirs of Pradeep Kumar and Subhash Chand were served
with notice in the Special Leave Petition which led to the present
Civil Appeal. An application was filed by the appellant to implead
the legal heirs of Subhash Chand namely, Amit Goyal son of late
Shri Subhash Chand and Smt. Swati Goyal daughter of Shri
Subhash Chand. Notice of the said I.A. Nos. 23917, 23920 and
23921 of 2019 was ordered to be issued on 26.02.2020. As per the
office report, notice was issued to the proposed legal heirs of the
deceased Respondent No.4. The service was effected on the
proposed legal heirs as per tracking report of the postal
authorities. It is thereafter, on 28.07.2021, the application for
substitution of the legal heirs of Respondent No. 4 was allowed. But
none has put an appearance on behalf of the legal heirs of
Respondent No.4.
3. Brief facts leading to the present appeal are that an application
was filed by Pradeep Kumar in July 1982 before the Court of Rent
Control and Eviction Officer, Dehradun, the District Magistrate, in
terms of the Act. In such application, Pradeep Kumar, the
successor-in-interest of tenant Tika Ram averred that Subhash
Chand was a divorcee and had no children and was willing to
devote full time in the said proposed business of sale of milk, curd,
ghee and butter. The application was however opposed by the
landlord. It was inter alia averred that after death of Tika Ram, he
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had left behind 8 legal heirs who were joint tenants in the disputed
property. It was stated that Subhash Chand was a sub-tenant and
that he was involved in demolition, changing the structure and
making furniture for last two months. Shri Pradeep Kumar has put
such person in possession of the property. It is also averred that
Subhash Chand has been doing the business of milk products in
Dehradun and that the application has been filed in order to only
cover the sub-tenancy. It was argued that Pradeep Kumar had put
such person in possession of the shop who was not a member of
their family and thus property would be deemed to be vacant
under Section 12(2) of the Act. However, the District Magistrate
permitted Subhash Chand to be inducted as a partner on
15.11.1982. It was thereafter, on 19.11.1982, a written partnership
deed was signed between Pradeep Kumar and Subhash Chand, a
copy of which is annexed herewith as P-4. Clause 6 of the said
Partnership Deed states that all provisions of the Partnership Act
would be applicable.
4. The landlord challenged the order passed by the District Magistrate
before the learned District Judge. Such revision petition was
dismissed on 12.12.1983. Further challenge before the High Court
through Writ Petition also remained unsuccessful vide order dated
10.10.2007. The appellant challenged the said order by way of
Special Leave Petition before this Court but the same was
dismissed on 10.01.2008. It is thereafter, the appellant filed an
application for review before the High Court inter alia on the
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ground that pursuant to the death of the tenant, Pradeep Kumar
i.e., one of the partners of the firm, the partnership does not
survive in view of Section 42(c) of the Partnership Act. Section
42(c) reads as under:
“42. Dissolution on the happening of certain
contingencies.—Subject to contract between the
partners a firm is dissolved,—
(a) xxx xxx xxx
(b) xxx xxx xxx
(c) by the death of a partner
(d) xxx xxx xxx”
5. Such review was dismissed vide order impugned in the present
appeal on the ground that the petitioners have entirely set up a
new case and the grounds urged are different from that of the writ
petition. As on record, both the partners, i.e. Pradeep Kumar and
Subhash Chand had died on 21.05.2004 and 25.06.2014,
respectively. Hence, now the argument is that in terms of Section
42(c), the partnership stands dissolved by law. There is no clause
in the partnership deed which permits the legal heirs of the
deceased partners to continue with the partnership firm. Therefore,
by operation of law, the partnership has come to an end.
6. Though learned counsel for the appellant raised an argument that
approval of the District Magistrate, an Executive Authority, to seek
permission to sublet or admit a partner was against the principle of
separation of powers between the executive and judicial or quasi-
judicial functions, however we need not examine the said question
in the present appeal.
7. The relevant provisions of the Act read as under:
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“12. Deemed vacancy of building in certain cases-
(1) A landlord or tenant of a building shall be deemed to
have ceased to occupy the building or a part thereof
if- (a) he has substantially removed his effects
therefrom; or
(b) he has allowed it to be occupied by any
person who is not a member of his family; or
(c) in the case of a residential building, he as well
as members of his family have taken up
residence, not being temporary residence,
elsewhere.
(2) In the case of non-residential building, where a
tenant carrying on business in the building admits a
person who is not a member of his family as a
partner or a new partner, as the case may be, the
tenant shall be deemed to have ceased to occupy
the building.
25. Prohibition of sub-letting.-
(1) No tenant shall sub-let the whole of the building
under his tenancy.
(2) The tenant may, with the permission in writing of
the landlord and of the District Magistrate, sub-let a
part of the building.
Explanation.- For the purposes of this section-
(i) Where the tenant ceases, within the meaning
of clause (b) of sub-section (1) or sub-section
(2) of Section 12, to occupy the building or
any part thereof, he shall be deemed to have
sub-let that building or part;
(ii) Lodging a person in a hotel or a lodging house
shall not amount to sub-letting.”
8. In terms of Section 41 of the Act, U.P. Urban Buildings (Regulation
of Letting, Rent and Eviction) Rules, 1972 have been published on
1.7.1972. Every landlord had to give notice of the vacancy in
writing to the District Magistrate, if a building had fallen vacant
under Section 15 of the Act. Under Section 16 of the Act, District
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Magistrate has been authorized to pass an order in respect of user
of such building. Rule 10 deals with allotment procedure of a
building which has fallen vacant. Sub-Rule 6 is relevant for the
purpose of present appeal, which reads thus:
“6. A person who is deemed to have ceased to occupy a
building within the meaning of Section 12(1)(b), or who is
evicted under Section 21 by virtue of being a tenant referred
to in Explanation (1) of Section 21(1) shall not be allotted
that or any other residential building and a person who is
deemed to have ceased to occupy a building within the
meaning of Section 12(2), shall not be allotted that or any
other non-residential building for a period of two years from
the date of such eviction or deemed cessation, as the case
may be:
Provided that-
(a) if the District Magistrate is satisfied in a case referred
to in Section 12(2) that the admission of partner or
new partner is bona fide transaction and not a mere
cover for sub-letting, he shall, if any application had
been made in that behalf before the admission of
such partner or new partner, allot the non-residential
building in question afresh to the newly constituted
or re-constituted firm.
(b) ………………………………….”
9. The learned Counsel for the appellants relied upon the judgment of
this Court in Kunhayammed and Others v. State of Kerala and
Another2 that the summary dismissal of the special leave petition
does not bar the remedy of review as the same is permissible
under law. In Khoday Distilleries Ltd. v. Sri Mahadeshwara
Sahakara Sakkare Karkhane Ltd. 3, this Court re-iterated the
principles of law as under:
“26.2 xxx xxx
(iv) An order refusing special leave to appeal may be a non-
speaking order or a speaking one. In either case it does not
2 (2000) 6 SCC 359
3 (2019) 4 SCC 376
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attract the doctrine of merger. An order refusing special
leave to appeal does not stand substituted in place of the
order under challenge. All that it means is that the Court
was not inclined to exercise its discretion so as to allow the
appeal being filed.
(v) If the order refusing leave to appeal is a speaking order
i.e. gives reasons for refusing the grant of leave, then the
order has two implications. Firstly, the statement of law
contained in the order is a declaration of law by the
Supreme Court within the meaning of Article 141 of the
Constitution. Secondly, other than the declaration of law,
whatever is stated in the order are the findings recorded by
the Supreme Court which would bind the parties thereto and
also the court, tribunal or authority in any proceedings
subsequent thereto by way of judicial discipline, the
Supreme Court being the Apex Court of the country. But, this
does not amount to saying that the order of the court,
tribunal or authority below has stood merged in the order of
the Supreme Court rejecting the special leave petition or
that the order of the Supreme Court is the only order binding
as res judicata in subsequent proceedings between the
parties.
(vi) Once leave to appeal has been granted and appellate
jurisdiction of the Supreme Court has been invoked the
order passed in appeal would attract the doctrine of merger;
the order may be of reversal, modification or merely
affirmation.
(vii) On an appeal having been preferred or a petition
seeking leave to appeal having been converted into an
appeal before the Supreme Court the jurisdiction of the High
Court to entertain a review petition is lost thereafter as
provided by sub-rule (1) of Order 47 Rule 1 CPC.
26.3. Once we hold that the law laid down
in Kunhayammed [Kunhayammed v. State of Kerala, (2000)
6 SCC 359] is to be followed, it will not make any difference
whether the review petition was filed before the filing of
special leave petition or was filed after the dismissal of
special leave petition. Such a situation is covered in para 37
of Kunhayammed case [Kunhayammed v. State of Kerala,
(2000) 6 SCC 359]”.
10. The argument of the learned counsel for the appellant is that
subsequent events consequent to the order passed by the District
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Magistrate had to be taken into consideration. The High Court
however failed to take into consideration death of one of the
partners leading to deemed vacation of the premises. The
appellant relied upon the judgment of this Court in Pasupuleti
Venkateswarlu v. The Motor & General Traders4 wherein it has
been held as under:
“4. We feel the submissions devoid of substance. First
about the jurisdiction and propriety vis-à-vis circumstances
which come into being subsequent to the commencement
of the proceedings. It is basic to our processual
jurisprudence that the right to relief must be judged to exist
as on the date a suitor institutes the legal proceeding.
Equally clear is the principle that procedure is the handmaid
and not the mistress of the judicial process. If a fact, arising
after the lis has come to court and has a fundamental
impact on the right to relief or the manner of moulding it, is
brought diligently to the notice of the tribunal, it cannot
blink at it or be blind to events which stultify or render inept
the decretal remedy. Equity justifies bending the rules of
procedure, where no specific provision or fairplay is not
violated, with a view to promote substantial justice- subject,
of course, to the absence of other disentitling factors or just
circumstances. Nor can we contemplate any limitation on
this power to take note of updated facts to confine it to the
trial Court. If the litigation pends, the power exists, absent
other special circumstances repelling resort to that course
in law or justice. Rulings on this point are legion, even as
situations for applications of this equitable rule are myriad.
We affirm the proposition that for making the right or
remedy claimed by the party just and meaningful as also
legally and factually in accord with the current realities, the
Court can, and in many cases must, take cautious
cognizance of events and developments subsequent to the
institution of the proceeding provided the rules of fairness
to both sides are scrupulously obeyed. On both occasions
the High Court, in revision, correctly took this view. The
later recovery of another accommodation by the landlord,
during the pendency of the case, has as the High Court
twice pointed out, a material bearing on the right to evict,
in view of the inhibition written into Section 10(3) (iii) itself.
We are not disposed to disturb this approach in law or
finding of act.”
4 (1975) 1 SCC 770
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11. Therefore, the subsequent event of death of Pradeep Kumar being
relevant was bound to be taken into consideration by the High
Court in the review petition.
12. The appellant also relied upon the judgment of this Court reported
as Harish Tandon v. Addl. District Magistrate, Allahabad, U.P
and Others5 interpreting Section 12(2) and 25 of the Act. It was
held as under:
“17. When sub-section (2) of Section 12 provides that
whenever a tenant carrying on business in a building admits
a person, who is not a member of his family, as a partner,
the tenant shall be deemed to have ceased to occupy the
building, full effect has to be given to the mandate of the
Legislature. There is no escape from the conclusion that
such tenant has ceased to occupy the building. No
discretion is left to the court to enquire or investigate as to
what was the object of such tenant while inducting a person
as partner who was not the member of his family. It can be
said that the aforesaid statutory provision requires the court
to come to the conclusion that by the contravention made
by the tenant, such tenant has ceased to occupy the
building. The framers of the Act have not stopped only at
the stage of Section 12(2) but have further provided in
Section 25, Explanation (i) another legal fiction saying that
where the tenant ceases to occupy the building within the
meaning of sub-section (2) of Section 12 “he shall be
deemed to have sub-let that building or part”. In view of the
three deeming clauses introduced in sub-section (2) of
Section 12, sub-section (4) of Section 12 and Explanation (i)
to Section 25, no scope has been left for the courts to
examine and consider the facts and circumstances of any
particular case, as to what was the object of admitting a
person who is not the member of the family, as partner and
as to whether, in fact, the premises or part thereof have
been sub-let to such person.
xxx xxx xxx
25. The framers of the Act have clearly expressed their
intention in Sections 12, 20 and 25 while protecting the
5 (1995) 1 SCC 537
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tenant from eviction except on the grounds mentioned in
Section 20, that after the death of the original tenant his
heirs will be deemed to be holding the premises as joint
tenants and for any breach committed by any of such joint
tenants, all the heirs of the original tenant have to suffer.
They cannot take a plea that unless the grounds for eviction
mentioned in sub-section (2) of Section 20 are established
individually against each one of them, they cannot be
evicted from the premises in question.”
13. We find that the order of permitting Subhash Chand as partner with
Pradeep Kumar has come to an end by efflux of time and operation
of law. In terms of Section 42(c) of the Partnership Act, partnership
stands dissolved by death of a partner. One of the partners i.e.,
Pradeep Kumar died on 21.05.2004. The High Court has not taken
note of such fact in the review petition and failed to take into
consideration the subsequent events which were germane to the
controversy. Subhash Chand, the other partner also died during the
pendency of appeal on 25.06.2014. It was represented to the
District Magistrate by Pradeep Kumar that Subhash Chand is a
divorcee and has no children but such assertion was not found to
be correct as he had two children, a son and a daughter who were
impleaded as his legal heirs.
14. Therefore, with the death of both partners and not having any
clause permitting continuation of the partnership by the legal
heirs, the non-residential tenanted premises is deemed to be
vacant in law as the tenant is deemed to have ceased to occupy
the building. In view thereof, the order passed by the High Court in
Review Application dated 23.04.2008 is set aside.
15. The Civil Appeal is thus allowed and the tenant is deemed to cease
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to occupy the premises in question. Consequently, the tenanted
property has fallen vacant as well. The appellants may take
recourse to remedy as may be available to them and may proceed
in accordance with law and the provisions of the Act.
………………………………………J.
(HEMANT GUPTA)
………………………………………J.
(A.S. BOPANNA)
NEW DELHI;
AUGUST 10, 2021.
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