Kunhipparambath Rajan v. K.P Muhammed and Others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT:** **THE HONOURABLE MR.JUSTICE P.N.RAVINDRAN & THE HONOURABLE MR. JUSTICE K.RAMAKRISHNAN** **MONDAY, THE 18TH DAY OF JANUARY 2016/28TH POUSHA, 1937** ## **RCRev.No. 170 of 2013 ()** **-------------------------AGAINST THE JUDGMENT IN RCA 18/2009 of RENT CONTROL APPELLATE AUTHORITY, THALASSERY DATED 05-02-2013** **AGAINST THE ORDER IN RCP 10/2007 of RENT CONTROL COURT, THALASSERY DATED 24.9.2008** ## **REVISION PETITIONER(S)/RESPONDENT NO.1/RESPONDENT NO.1:-:** **---------------------------------------------------------------------------------------------------** **KUNHIPARAMBATH RAJAN, AGED 50 YEARS, S/O.KUNKAN, KUNHIPARAMBATH HOUSE, CHALAKKARA P.O. NEW MAHE.** ## **BY ADV. SRI.MAHESH V RAMAKRISHNAN** **RESPONDENT(S)/APPELLANT AND RESPONDENTS 2 TO 4/PETITIONER AND RESPONDENTS 2 TO 4:-:** **--------------------------------------------------------------------------------------------------------------------** ## **1. K.P MUHAMMED, AGED 65 YEARS** - **S/O.ABDU, THAYILAKANDY HOUSE, CHETTAMCOON THALASSERY P.O., THALASERY TALUK, KANNUR DIST. * (DIED, LRs IMPLEADED)** **2. KUNHIPARAMBATH GANGADHARAN, AGED 52 YEARS S/O.KUNKAN, SHOP NO.41, NEW MAHE GRAMA PANCHAYATH NEW MAHE. ** (DIED, LRs IMPLEADED)** ## **3. P.K.JAYARAJ,** **NEPTUNE ENGINEERING, KALLAYI, P.O.NEW MAHE NOW RESIDING AT PUTHITEDATH VEETTIL THIRUVANGAD AMSOM, KAVUMBHAGAM DESOM THALASSERY TALUK.** ## **4. A.K.RAJEEVAN,** **NEPTUNE ENGINEERING, KALLAYI, P.O.NEW MAHE, NOW RESIDING AT MURIKKOLI VEETTIL,, KADIRUR AMSOM, PONNIAM DESOM, THALASSERY TALUK.** **RCRev.No. 170 of 2013** **2** ## ***ADDL. R5 TO R8 IMPLEADED** **5. AYISSA T., W/O.LATE K.P.MUHAMMED, AGED 57 YEARS,** ## **6. FALEEL T., S/O.LATE K.P.MUHAMMED, AGED 39 YEARS,** **7. FARAS T., S/O.LATE K.P.MUHAMMED, AGED 35 YEARS,** **8. FAHAD T., S/O.LATE K.P.MUHAMMED, AGED 24 YEARS,** **RESPONDENTS 5 TO 8 ARE RESIDING AT THAYILAKANDY HOUSE, CHETTAMCOON, THALASSERY P.O., THALASERY TALUK, KANNUR DIST.** **ADDL. R5 TO R8 ARE IMPLEADED AS THE LEGAL HEIRS OF THE DECEASED 1ST RESPONDENT VIDE ORDER DATED 8.7.15 IN IA NO.1577/2015.** ****ADDL. R9 TO R11 IMPLEADED** **9. JALAJA, W/O.LATE KUNHIPARAMBATH GANGADHARAN, AGED 52 YEARS** **10. JIJITH, S/O.LATE KUNHIPARAMBATH GANGADHARAN, AGED 30 YEARS** **11. JIJIN, S/O.LATE KUNHIPARAMBATH GANGADHARAN, AGED 26 YEARS** **RESPONDENTS 9 TO 11 ARE RESIDING AT KUNHIPARAMBATH HOUSE, P.O. CHALAKKARA, NEW MAHE - 673 310.** **ADDL. R9 TO R11 ARE IMPLEADED AS THE LEGAL HEIRS OF THE DECEASED 2ND RESPONDENT VIDE ORDER DATED 12.1.16 IN IA NO.2103/2015.** **R1, R5 & R8 BY ADVS. SRI.C.KHALID SMT.P.VANDANA SRI.PHIJO PRADEESH PHILIP R3 & R4 BY ADV. SRI.JOE KALLIATH** **THIS RENT CONTROL REVISION HAVING BEEN FINALLY HEARD ON 18-01-2016, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** **vpv** ## **P.N.RAVINDRAN & K.RAMAKRISHNAN, JJ. =-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-= R.C.R.No.170 of 2013 =-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-= Dated this the 18[th] day of January, 2016** ## **ORDER** ## _**K.Ramakrishnan, J.**_ The first respondent in R.C.P.No.10 of 2007 on the file of the Rent Control Court, Thalassery is the revision petitioner herein. For the purpose of convenience, the relationship between the parties can be termed as landlord, tenant and subtenant in this revision. 2. The landlord filed an application for eviction under section 11 (2)(b), 11(3) and 11(4)(i) of the Kerala Buildings (Lease and Rent Control) Act, 1965, hereinafter referred to as “the Act” for short. The case of the landlord in the rent control petition was that he wants to start a stationery business for his livelihood, that he is not in possession of any other building and that he requires the petition schedule building for his bonafide purpose. The building was let out to the tenants who are respondents 1 and 2 in the rent control court as per Ext.A6 kychit dated 1.6.1977 fixing the rent of Rs.50/- by the predecessor of the present landlord namely Aysumma. After her death, the right in the property devolved on her children including the ## **R.C.R.No.170 of 2013** ## **-:2:-** landlord namely Sri.K.P.Muhammed. Thereafter the rent has been enhanced to Rs.100/- per month. The tenants had not paid the rent and kept the rent in arrears. Further the tenants have sublet the building to respondents 3 and 4 in the rent control petition for rent and they are not depending on the income and there are other buildings available in the locality and they are not entitled to get the protection under section 11(3) of the Act. Though notice has been issued to respondents 1 and 2 demanding arrears of rent and intimating the violation of creating sublease, they sent reply with false allegations. Therefore, the petitioner has no other remedy except to approach the rent control court for eviction on the ground of arrears of rent, bonafide need and sublease. 3. Respondents 1, 3 and 4 in the rent control petition appeared and filed counter statement. They admitted that the building was taken on rent by respondents 1 and 2 on a monthly rent of Rs.50/-. But they denied the allegation that rent has been enhanced to Rs.100/- as claimed by the landlord. The bonafide need alleged by the petitioner was denied. They also claimed protection under the second proviso to section 11(3) of the Act. They also denied the allegation that they have sublet the building. According to them, the first respondent in the rent control petition fell ill and he had entrusted the ## **R.C.R.No.170 of 2013** ## **-:3:-** conduct of the business to respondents 3 and 4 on a licence arrangement and there is no sublease and they prayed for dismissal of the application. 4. The petitioner was examined as PW1 and the first respondent was examined as RW1. Exts.A1 to A6 and Exts.B1 to B6 were marked on the side of the respective parties. The Commissioner was examined as CW1 as court's witness and Ext.C1 was also marked. After considering the evidence on record, the rent control court came to the conclusion that there is no rent in arrears and the rent was only Rs.50/- per month and the need alleged was not bonafide and there was no sublease and it was only a licence agreement between the respondents and dismissed the application. 5. Aggrieved by the order of dismissal, the landlord filed R.C.A.No.18 of 2009 before the Rent Control Appellate Authority, Thalassery and the appellate authority by judgment delivered on 5.2.2013, set aside the finding of the court below on the question of sublease and also on the question of bonafide need and ordered eviction under section 11(4)(i) and also found that the bonafide need alleged by the petitioner is genuine but remanded the case to the court below for the purpose of considering the availability of protection under the second proviso to section 11(3) of the Act to the tenants. ## **R.C.R.No.170 of 2013** ## **-:4:-** Aggrieved by the same, the present revision has been filed by the first respondent in the rent control petition. 6. Heard Sri.Mahesh V.Ramakrishnan, learned counsel appearing for the revision petitioner and Sri.C.Khalid, learned counsel appearing for the first respondent. Others remained absent. 7. Learned counsel appearing for the revision petitioner submitted that the rent control appellate authority was not justified in construing Ext.B4 agreement as lease agreement. In fact, there is no exclusive possession given. What is given is only a right to conduct the business and the tenant is retaining legal possession of the building and as such, there is no sublease. According to the learned counsel, the rent control court had considered all the legal aspects and correctly came to the conclusion that the agreement is a licence agreement and as such, the finding that there is sublease is not proper. Further, the finding of the court below regarding the bonafide need is also not proper on the basis of the evidence adduced. 8. On the other hand, the counsel appearing for the first respondent submitted that the appellate authority has considered all the aspects in the right perspective. Further the evidence will go to show that the exclusive possession of the building was given to respondents 3 and 4 and they were conducting the business and the ## **R.C.R.No.170 of 2013** ## **-:5:-** tenant had no control over the same and as such, the rent control appellate authority was perfectly justified in ordering eviction under section 11(4)(i) of the Act. The court below was also perfectly justified in holding that the bonafide need alleged is genuine. In fact, the court below need not have remanded the case to the trial court as having found that there is sublease, as the tenant is not entitled to get the protection under the second proviso to section 11(3) of the Act. 9. The fact that the petition schedule building was let out to respondents 1 and 2 by the predecessor of the petitioner is not in dispute. It is also in a way admitted that respondents 3 and 4 are in possession of the building by virtue of Ext.B4 agreement entered into between the revision petitioner herein and respondents 3 and 4 in the lower court. The question is as to whether there is only a licence agreement or it is a camouflage to cover the sublease that it has been named as the licence agreement. The test for considering the question as to whether it is a licence or lease is question of parting of possession of the building to the subtenant. In this case it was admitted by RW1 that respondents 3 and 4 are in possession of the building and they are conducting the business. It is true that the licence is taken in the name of the concern, Neptune Engineering Works and profession tax is being paid by the revision petitioner. But ## **R.C.R.No.170 of 2013** ## **-:6:-** that alone is not sufficient to come to the conclusion that he is in exclusive possession of the building or retaining legal possession of the building. Even a reading of Ext.B4 agreement will go to show that though it is termed as licence agreement and the payment is mentioned as licence fee, it will be seen from the agreement itself that if the revision petitioner did not make out any repairs or carryout electrical works in the building, the alleged llicencees are entitled to carry out the repairs and adjust the same in the licence fee. Further it was admitted by RW1 that he had no control over the business and it is being done by respondents 3 and 4 in the rent control court. It was also admitted by him that he is not retaining possession and the key of the building was given to the alleged licencees. It was also admitted by him that he was receiving Rs.100/- per day as licence fee according to the tenants but it will be seen from the evidence that the word “licence” for the agreement and the “licence fee” for the rent has been mentioned only as to cover the sublease and make it appear as a licence agreement in order to defeat the right of the landlord. 10. Similar question has been considered by a Division Bench of this court in **Pankajam v. Radha Nedumgadi and Another** [2004 (1) KLJ 164]. In that case, after relying on several decisions, the Division Bench held that the test to consider whether it is sublease or ## **R.C.R.No.170 of 2013** ## **-:7:-** licence is the question of parting with exclusive possession of the property and if it is found so then, it is also to be considered even if it is termed as licence agreement between the sublessees and the tenant if the landlord is able to establish that the exclusive possession of the building has been given, then the terms of the agreement is not binding on the landlord to consider the question of jural relationship between the parties to the said licence agreement and the burden is heavy on the tenant to prove the jural relationship between him and the party found to be in possession of the building. In the same case it has been observed that it is needless to mention that if the enquiry reveals that the arrangement between the tenant and the alleged subtenant or transferee is really a licence only, order of eviction will not be passed, but if the enquiry reveals that the arrangement though styled as licence is one intended as a camouflage for an arrangement of sublease or transfer of possession, order of eviction will follow. So it is for the court to consider on the basis of evidence as to whether the arrangement between them is really a lease agreement or a licence agreement. There is no dispute regarding the proposition of law laid down in the decision reported in **Ayurvedic Oushada Nirmana Vyavasaya Co. Op. Ltd. v. Abraham** [1987 (1) KLT 853] relied on by the counsel for the revision petitioner and that can be distinguished ## **R.C.R.No.170 of 2013** ## **-:8:-** on facts in this case. 11. From the above discussions it can be safely concluded that Ext.B4 agreement was styled as a licence agreement as a camouflage to cover the sublease created by the tenants in favour of the subtenants so as to defeat the right of the landlord. Further it was admitted in the counter statement as well as in the evidence of RW1 that since the revision petitioner was laid up and he was not able to conduct the business, he had entrusted the building with the business to respondents 3 and 4. Even admittedly he is not having any control over the conduct of the business as well. So all these things will go to show that the exclusive possession of the building was handed over to respondents 3 and 4 in the lower court and they are conducting the business as though it is their business and their liability is only to pay the rent for their occupation. It is true that later, after the rent control petition was filed, a suit was filed in which an order of recovery was obtained but in that case the relationship between them was not disputed probably with a view to cover up the act of sublease into one of licence to defend the case for eviction filed by the landlord as a collusive attempt between them. Under the circumstances, the rent control appellate authority was perfectly justified in coming to the conclusion that though it is styled as a licence agreement, really it is a ## **R.C.R.No.170 of 2013** ## **-:9:-** sublease and rightly ordered eviction under section 11(4)(i) of the Act and that finding does not call for any interference. 12. The appellate authority has remanded the case only for the purpose of considering the question of bonafide need put forward by the landlords on the ground that the trial court had not recorded any finding on that aspect. But on going through the order of the rent control court, it is seen that the rent control court had gone into the question but denied the eviction on the ground of bonafide need holding that they have got other buildings in their possession. If that be the case, the appellate authority should have considered the materials available on record being the first court on facts and should have considered those aspects and passed orders on that aspect as well instead of remanding the case to the court below. So, we feel that the judgment of the appellate authority to that extent has to be set aside and the matter has to be remitted to the appellate authority for considering the question of bonafide need and pass appropriate orders on that aspect including the question of availability of the proviso protection to the tenant. With the above direction alone, while confirming the order of eviction passed under section 11(4)(i) of the Act, the matter is remitted to the appellate authority for fresh consideration to the limited extent mentioned above. ## **R.C.R.No.170 of 2013** ## **-:10:-** With the above direction and observation, the revision petition is disposed of accordingly. The parties are directed to appear before the rent control appellate authority on 1.2.2016 and the appellate authority is directed to dispose of the appeal as expeditiously as possible, at any rate, before the courts close for summer vacation. Sd/- ## **P.N.RAVINDRAN JUDGE** Sd/- **K.RAMAKRISHNAN JUDGE** /true copy/ P.A. to Judge ## **vpv**