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AMICUS AI
Citation Codes
Equivalent Citations
citation codes
Case Number
Disposition
Advocates
Judges
Acts
  • Section 4 of the Partnership Act
  • Section 5, Subsection 2 of the 1983 Income Tax Act
  • Section 10(3)(a)(iii) of the Tamil Nadu Act
  • Section 10(3)(a)(iii) of the Act
  • Section 12(1)(f) of the Madhya Pradesh Accommodation Control Act, 1961
  • Section 10(3)(a)(iii) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Disposition
Advocates
Judges
Acts
  • Section 4 of the Partnership Act
  • Section 5, Subsection 2 of the 1983 Income Tax Act
  • Section 10(3)(a)(iii) of the Tamil Nadu Act
  • Section 10(3)(a)(iii) of the Act
  • Section 12(1)(f) of the Madhya Pradesh Accommodation Control Act, 1961
  • Section 10(3)(a)(iii) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960
Smart Summary

Factual and Procedural Background

The appeal arose from an eviction proceeding initiated by a landlord under Section 10(3)(a)(iii) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960. The landlord sought possession of the tenanted premises to accommodate the leather-goods business of his two sons. Both the Rent Controller and the Appellate Authority ordered eviction, and the High Court of Tamil Nadu affirmed those orders, holding that the requirement was bona fide. The tenant appealed to the Supreme Court, challenging only the maintainability of the eviction petition, not the finding of bona fide need.

Legal Issues Presented

  1. Whether an eviction petition under Section 10(3)(a)(iii) of the Tamil Nadu Buildings (Lease and Rent Control) Act is maintainable when the premises are required for the business of the landlord’s sons who conduct that business in partnership with non-family members.

Arguments of the Parties

Appellant (Tenant)

  • The application is not maintainable because the premises are sought for a partnership firm in which the landlord’s two sons share ownership with “strangers,” and Section 10(3)(a)(iii) covers only the landlord or members of his family acting in their individual capacity.
  • The sons’ partnership interest allegedly removes the requirement from the statutory definition of “landlord’s or family’s business.”

Respondent (Landlord)

  • The sons are active partners who previously helped run the family’s leather business and now hold one-half share in the new partnership; therefore, the business remains that of the landlord’s family.
  • Section 10(3)(a)(iii) permits eviction for the bona fide requirement of the landlord’s “family” for carrying on business, and the sons’ involvement satisfies that condition.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
D.N. Sanghavi & Sons v. Ambalal Tribhuwan Das, (1974) 1 SCC 708; AIR 1974 SC 1026 Meaning of “his business” under Section 12(1)(f) of the Madhya Pradesh Accommodation Control Act; accommodation must be needed directly and substantially for the landlord’s own occupation—sleeping partners would not qualify. Distinguished: unlike in Sanghavi, the landlord’s sons here are not sleeping partners; they actively conduct the leather business. Hence, the statutory requirement is satisfied.
Shantilal Thakordas v. Chimanlal Maganlal Telwala, (1976) 4 SCC 417; AIR 1975 SC 2358 Expressed doubt—without deciding—whether a landlord’s requirement for a partnership firm amounts to his own occupation. Cited to show earlier uncertainty; the present Court clarifies that where family members are active partners, their business need falls within Section 10(3)(a)(iii).

Court's Reasoning and Analysis

The Court began by noting the settled principle that a “partnership” is only a collective term for the individual partners (Section 4, Partnership Act). It examined evidence showing that the landlord and his sons had long conducted a leather business together and that, even after the sons entered into partnership with outsiders, they continued to take an active role and held half of the partnership shares.

Applying the precedent in Sanghavi, the Court observed that the earlier case dealt with a son who was effectively a sleeping partner. By contrast, the present sons were active partners, directly engaged in day-to-day business. Therefore, the statutory phrase “for the purpose of a business of the landlord or any member of his family” in Section 10(3)(a)(iii) encompassed the sons’ business although conducted in partnership with others.

The Court further noted that Shantilal Thakordas had left the issue open, and that no inconsistency existed with recognising the sons’ active partnership as fulfilling the statutory condition. Consequently, the sole legal objection raised by the tenant failed.

Holding and Implications

APPEAL DISMISSED. The High Court’s order of eviction stands affirmed.

Implications: The decision confirms that, under Section 10(3)(a)(iii) of the Tamil Nadu Buildings (Lease and Rent Control) Act, a landlord may seek eviction where the premises are required for the business of his family members even if that business is operated as a partnership with non-family persons, provided the family members are active partners. No new broader precedent was expressly declared, but the ruling clarifies the statutory scope in similar factual settings.

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    Krishnan Nair And Others v. Ghouse Basha .

    Sabyasachi Mukharji, J.— This is an appeal by the tenant against the judgment and order of the High Court of Tamil Nadu. By the aforesaid judgment the High Court upheld the landlord's contention of bona fide requirement of the premises in question for the business of his sons and maintained the order of eviction passed by the courts below. So far as the question of bona fide need is concerned it has been upheld by the courts below and that finding is not assailed before us. But what was contended was that the application itself under Section 10(3)(a)(iii) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960, hereinafter called “the Act” was not maintainable as the requirement of the land was not for the landlord or members of his family as such but for two sons who were running a leather business in partnership with strangers. The deed of partnership was examined by the High Court but it is, however, not before us. It appears from the evidence that previously the father and the two sons used to carry on leather business from long time. The sons went into the partnership with others and two of the sons are partners. They jointly hold half the shares. From the evidence it appears that the sons used to take active part even before the partnership started in the leather business, carried on by the father. Thereafter, the partnership firm with the other partners carried on the business. We must proceed on the basis that the partnership deed was silent as to what role the sons of the landlord would perform in this. The only question which was urged before us was that the application for eviction under Section 10(3)(a)(iii) of the Act was liable to be dismissed solely on the ground that the landlord has chosen to file this application to accommodate a partnership firm in which his sons and some strangers are partners and it is not in conformity with the provisions of Section 10(3)(a)(iii) of the said Act. Partnership, as is well settled has a compendious way of describing those who constitute the firm under Section 4 of the Partnership Act. Now, if that is the position, in our opinion, if a person carries on a business along with other partners and it was the other partner who actually carried on the business the position perhaps would have been entirely different. If the same were only sleeping partners that would have been different. On the contrary, here having regard to the past conduct of the sons and having regard to the shares this was their only application where sons were carrying on the business along with other partner. If that is the position in our opinion under Section 10(3)(a)(iii) of the Act as the sons and members of the family carrying on the business in terms of the section will be entitled to the benefit of eviction.

    2. Our attention was drawn to a decision of this Court in D.N Sanghavi & Sons v. Ambalal Tribhuwan Das (1974) 1 SCC 708, AIR 1974 SC 1026, (1974) 3 SCR 55 where the meaning of the expression “his business” under Section 12(1)(f) of the Madhya Pradesh Accommodation Control Act, 1961 came up for consideration. The said section was in pari materia with the present section. Therefore this Court held that the meaning of the expression “his business” under Section 12(1)(f) of the said Act is to be determined by the examination of the object of the Act and setting of the phrase “his business”. There Dwivedi, J. speaking for the court found that before the partnership, it was stated that the father used to run the shop. Father died during the pendency of the suit and neither in the statements of the respondent owner of the premises nor anywhere else in the evidence the respondent had stated that on the terms of the partnership he was entitled to manage the partnership business or even that he would also occupy the suit accommodation along with his other partners on obtaining possession from the appellant. He had also not stated that the other partners had agreed to shift the business. The court observed that if the deed of partnership had excluded the son expressly or impliedly from the management of the firm of business and had made him a sleeping partner it could not be held that the accommodation was needed directly and substantially for his occupation by way of his business. The firm is carrying on the business in the premises in respect of which the eviction was asked for the said firm. But here there is no evidence that the sons were sleeping partners. On the contrary, there is evidence that they were in the leather business and had carried on the business previously before shifting to the premises in question. If that is the position, it cannot be accepted that they were sleeping partners. On the contrary, having regard to the number (sic), they were active partners in the business and as such the sons needed (sic sons' requirement of) the accommodation with others would be for sons' business under Section 10(3)(a)(iii) of the Tamil Nadu Act. We may mention that in the subsequent decision of this Court in Shantilal Thakordas v. Chimanlal Maganlal Telwala (1976) 4 SCC 417, AIR 1975 SC 2358, (1977) 1 SCR 341, this question did not directly arise but there this Court noted that some of the High Courts have taken the view that occupation by partner who was a member of the family would be the occupation of the landlord. This Court felt that they should not express any opinion in that regard, but doubt was expressed as to whether the requirement of the premises by the landlord for the occupation of the partnership firm in which he was a partner would tantamount to the occupation by landlord. It appears that the attention of this Court was not drawn to the earlier decision referred to hereinbefore. In any event, the court had no occasion to express any opinion where the sons are active partners in a partnership firm whether such business carried on by the sons would not come within the provisions of Section 10(3)(a)(iii) of the Act.

    3. In the aforesaid view of the matter we uphold the order and judgment of the High Court and we are unable to accept the challenge to the order. The appeal must therefore, fail and is accordingly dismissed. In the facts and circumstances of the case there will be no order as to costs.

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    Comments

    Krishnan Nair And Others v. Ghouse Basha .
    (Sep 8, 1987)