AMICUS AI
Citation Codes
Equivalent Citations
citation codes
Case Number
Advocates
Judges
Acts
  • section 2 of the Central Provinces and Berar Regulation of Letting of Accommodation Act, 1946. Section 8 of that Act
  • section 7 of the U.P (Temporary) Control of Rent and Eviction Act, 1947. Section 7(1) of that Act
  • provisions of the Transfer of Property Act and the Contract Act.
  • BOMBAY RENTS HOTEL AND LODGING HOUSE RATES CONTROL ACT 1947
  • provisions of clauses 22 and 23 of the Rent Control Order
  • provisions of the U.P Act and the Rent Control Order
  • U.P (Temporary) Control of Rent and Eviction Act
  • section 2(12) of the Code of Civil Procedure
  • TRANSFER OF PROPERTY ACT
  • provisions of the U.P Act and the Rules
  • provisions of the Rent Control Order.16.
  • provisions of the Rent Control Order
  • 1959 SC 689.. Section 15 of that Act
  • SECTION 23 CONTRACT ACT
  • provisions of the U.P Act
  • provisions of section 7(2)
  • section 7 of the U.P Act
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Advocates
Judges
Acts
  • section 2 of the Central Provinces and Berar Regulation of Letting of Accommodation Act, 1946. Section 8 of that Act
  • section 7 of the U.P (Temporary) Control of Rent and Eviction Act, 1947. Section 7(1) of that Act
  • provisions of the Transfer of Property Act and the Contract Act.
  • BOMBAY RENTS HOTEL AND LODGING HOUSE RATES CONTROL ACT 1947
  • provisions of clauses 22 and 23 of the Rent Control Order
  • provisions of the U.P Act and the Rent Control Order
  • U.P (Temporary) Control of Rent and Eviction Act
  • section 2(12) of the Code of Civil Procedure
  • TRANSFER OF PROPERTY ACT
  • provisions of the U.P Act and the Rules
  • provisions of the Rent Control Order.16.
  • provisions of the Rent Control Order
  • 1959 SC 689.. Section 15 of that Act
  • SECTION 23 CONTRACT ACT
  • provisions of the U.P Act
  • provisions of section 7(2)
  • section 7 of the U.P Act
Smart Summary

Judgment Summary — Gadgil, J. (Appeal from decree in Special Civil Suit No. 16 of 1966, Civil Judge, Senior Division, Akola)

Factual and Procedural Background

This is the defendant's appeal against a decree obtained by the plaintiff in Special Civil Suit No. 16 of 1966. The dispute concerns one shop-block (the suit premises) forming part of house No. 92, ward No. 29, Akola. The plaintiff purchased the house on 2-2-1954 (sale deed Ex. 117). Deceased Shiojibhai had been in occupation as tenant of three blocks/tenements before that purchase; he vacated one block in 1956 and continued in the remaining two at an agreed rent. Shiojibhai died on 9-3-1958 leaving daughters and two brothers, including Shamjibhai. The brothers had earlier partitioned their estate on 15-11-1948 (partition deed Ex. 128).

The plaintiff's pleaded case was that by Diwali 1958 (about 11-11-1958) both blocks were given in possession to the plaintiff; one block (the suit premises) was thereafter let to Shamjibhai at Rs. 100 per month; subsequently (Oct-Nov 1959 to Oct-Nov 1961) Shamjibhai and the defendant Kakubhai jointly possessed the suit premises and, after Diwali 1961, the defendant alone continued as tenant and paid rent. The plaintiff alleged that the lettings in 1958 (to Shamjibhai) and 1961 (to the defendant) were in contravention of Clause 22 of the C.P. & Berar Letting of Houses and Rent Control Order, 1949 (which required intimation to the Collector when a house became vacant) and therefore void; the plaintiff sought possession and mesne profits.

The plaintiff earlier instituted two proceedings in 1965 (Small Cause Suit No. 8 of 1965 for arrears of rent, and a Rent Control proceeding under Clause 13) but withdrew both; the plaintiff says those were filed under a mistaken belief that the defendant was a lawful tenant and were withdrawn once it became clear the lease was void. The trial court framed issues, heard evidence and decreed the suit (finding the leases void for absence of intimation, treating the defendant as a licensee whose licence was revoked).

Legal Issues Presented

  1. Whether the lettings of the suit premises in November 1958 (to Shamjibhai) and in November 1961 (to the defendant) amounted to a "vacancy" within the meaning of Clause 22 of the C.P. & Berar Letting of Houses and Rent Control Order, 1949, thereby attracting the obligation to give intimation to the Collector.
  2. Whether non-compliance with Clause 22 (failure to give intimation) renders a lease void (i.e., whether a lease made in contravention of Clauses 22 and 23 is legally void or remains valid between parties but unenforceable against authorities).
  3. Whether the plaintiff is estopped or has waived the right to contest the lease because of earlier actions (the Small Cause Suit and Rent Control proceedings) filed and later withdrawn.
  4. Whether the plaintiff is entitled to mesne profits at the higher rate awarded by the trial court (Rs. 10 per day for a specified period) and interest thereon.

Arguments of the Parties

Appellant (Defendant) — Principal contentions (as presented by Mr. Dharmadhikari)

  • There was no vacancy in November 1958 (nor in November 1961); hence no intimation under Clause 22 was required.
  • The lease in operation during Shiojibhai's lifetime continued after his death; the appellant had been in possession along with Shiojibhai (and later Shamjibhai), performing work in the shop, and thus a continuity of tenancy existed rather than a fresh letting.
  • The plaintiff accepted the defendant (and Shamjibhai) as tenants after Shiojibhai's death; therefore the plaintiff is estopped from now asserting the lease is void.
  • Reliance was placed on the Supreme Court decision in Murlidhar v. State of U.P (1974 2 SCC 472) and the Full Bench of the Allahabad High Court (Udhao Das v. Prem Prakash) which suggested that, under the U.P. Act, a lease made in violation of the intimation provisions could nevertheless be valid between the parties.
  • Challenged the award of mesne profits higher than the contractual rent and the allowance of interest on mesne profits.

Respondent (Plaintiff) — Principal contentions (as presented by Mr. Bobde)

  • The evidence and documentary receipt (Ex. 113 dated 22-11-1958) support that by Diwali 1958 the plaintiff had obtained possession of the shops; one block was let out thereafter to Shamjibhai and later to the defendant.
  • Clauses 22 and 23 of the Rent Control Order require intimation to the Collector and prevent occupation except in accordance with clause 23 or 24; lettings without compliance are prohibited.
  • Leases entered without the mandatory intimation under Clause 22(1) and without the Collector's order are void; reliance was placed on earlier decisions of this Court (Civil Revision Application No. 396 of 1959; Second Appeal No. 266 of 1963) and analogous Supreme Court authority on similar statutory schemes.
  • Filing and withdrawal of earlier proceedings do not estop the plaintiff from asserting the statutory invalidity of the lease; an unlawful agreement cannot be validated by waiver or estoppel.
  • Evidence supported the higher mesne profit rate (market rent in 1966) and interest on mesne profits is allowable under the definition in section 2(12) of the Code of Civil Procedure.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Second Appeal No. 286 of 1962 (decided 7-1-1970; digested at Note No. 21 in 1970 Mh. LJ Notes) Held that a notional vacancy can be created when the owner changes the character of his possession (e.g., becomes a tenant), and that notice under Clause 22 is essential in such cases. Used to support the proposition that a vacancy arose when the plaintiff let the premises in 1958 and 1961 and that intimation to the Collector was required.
Civil Revision Application No. 396 of 1959 (decided 26-9-1960; digested at Note 27 in 1961 NLJ Notes) Held that a lease made in contravention of Clauses 22 and 23 of the Rent Control Order was void. Relied on by the respondent; the Court treated this decision as authority supporting the voidness of leases made without the required intimation under the Rent Control Order.
Second Appeal No. 266 of 1963 (decided 11-3-1971; digested at Note No. 64 in 1971 Mh. L.J Notes) Expressed a similar view that absence of the required intimation rendered the tenancy illegal/void. Reinforced the line of authority that non-compliance with Clause 22 leads to invalid tenancy; relied on to support the decision in this case.
Murlidhar v. State of U.P., 1974 2 SCC 472 (Supreme Court) Under section 7 of the U.P. Act (analogous statutory scheme), the Supreme Court (citing Udhao Das) recognised the view that a lease made in violation of the intimation provisions could be valid between the parties and create a landlord-tenant relationship, though it might not bind authorities. The appellant relied on this decision to contend lease validity; the Court considered it but distinguished the U.P. Act's scheme from the Rent Control Order, finding the latter contained a specific prohibition making such lettings void.
Udhao Das v. Prem Prakash, A.I.R. 1964 All. 1 (Full Bench, Allahabad High Court) The Full Bench held that, under the U.P. Act, a lease made in violation of section 7(2) could be valid between parties and create landlord-tenant relations even if authorities were not bound. Cited in Murlidhar and relied upon by the appellant; the Court here distinguished the Rent Control Order as containing a clearer statutory prohibition (Clause 22(2)), making Udhao Das inapplicable.
Jiwan Singh v. Rajendra Prasad, 1975 2 SCC 171 (Supreme Court) Held that unless a landlord gives notice of vacancy within the time specified in section 7, he cannot nominate his own tenant as contemplated by the rules under the U.P. Act. Referenced during argument; the Court observed its limited utility because the U.P. Act's scheme differs materially from the Rent Control Order.
Srikrishna v. A.D.M., Kanpur, 1975 2 SCC 361 (Supreme Court) Held that compromises between landlord and tenant in contravention of the U.P. Act and Rules are unlawful, especially where they curtail the District Magistrate's statutory rights. Noted by counsel; the Court indicated it did not consider this decision central to the present dispute over the Rent Control Order's specific prohibition.
Abdul Hameed v. Mohd. Ishaq, AIR 1975 All. 166 (Full Bench, Allahabad High Court) Full Bench decision in which the earlier Full Bench decision (Udhoo Dass) was overruled. The Court noted this development but stated that consideration of it was not necessary for deciding the present case.
Waman Shriniwas v. Ratilal Bhagwandas & Co., AIR 1959 SC 689 (Supreme Court) Under section 15 of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947, sub-letting was declared unlawful and void; the Court held an illegal clause cannot be enforced by waiver/estoppel. Adopted by analogy to support the proposition that a statutory prohibition against letting/subletting renders the transaction void and that estoppel/waiver cannot be used to enforce an illegal agreement; relied on to reject the appellant's estoppel plea.

Court's Reasoning and Analysis

The Court undertook a fact-specific and statutory analysis. It first reviewed evidence on possession: although some documentary material (receipt Ex. 113) had statements of delivery of possession by Diwali 1958, the Court found the factual matrix showed no clear physical delivery of the suit premises to the plaintiff in October-November 1958. The defendant had been present and doing work in the shop during Shiojibhai's lifetime and witnesses deposed that possession was never wholly given up by Shiojibhai.

However, the Court examined the legal consequences of the relationships and transactions. It observed that Shiojibhai and Shamjibhai had been severed by a 1948 partition, meaning tenancy rights could not be assumed to devolve across that partition. The Court held that notwithstanding absence of clear physical delivery, the plaintiff treated Shamjibhai as an independent tenant from November 1958 (receipt and conduct indicated this) and that a fresh letting took place in November 1958 in favour of Shamjibhai and again in November 1961 in favour of the defendant.

Having concluded there were fresh lettings, the Court turned to the statutory provisions. It compared the C.P. & Berar Rent Control Order (Clauses 22 and 23) with the U.P. Act (section 7) and the leading authorities. Clause 22(2) of the Rent Control Order, the Court noted, provided an express prohibition: "No person shall occupy any house ... except under an order under sub-clause (1) of clause 23 or clause 24 or on an assurance ... in accordance with sub-clause (2) of clause 23." The Order was made under section 2 of the Central Provinces and Berar Regulation of Letting of Accommodation Act, 1946, and section 8 of that Act prescribed punishment for contravention.

The Court analysed competing authorities. It acknowledged that under the U.P. Act the Full Bench of Allahabad had held (in Udhao Das) that a lease made in violation of that Act could nevertheless be valid between parties; the Supreme Court in Murlidhar had cited Udhao Das. But the Court found the Rent Control Order's express prohibition in Clause 22(2) distinguishes the present statutory regime from the U.P. Act because the Rent Control Order affirmatively prevents occupation except in the specified manner. Consequently, a letting in contravention of Clause 22(2) is an occupation "not permitted" by the Rent Control Order and thus the consideration/object of such a lease is forbidden by law for the purposes of section 23 of the Contract Act.

The Court therefore concluded that the lettings to Shamjibhai (1958) and to the defendant (1961) were in breach of Clause 22(2) and were void. The Court further considered the estoppel/waiver contention arising from the plaintiff's earlier prosecutions/suits and rejected it: enforcement of a statutory prohibition (an illegal agreement) could not be validated by estoppel, relying on the Supreme Court authority in Waman Shriniwas and its reasoning that waiver cannot be used to enforce illegal statutory provisions.

On mesne profits the Court accepted the trial court's finding that the plaintiff had proved market rates in 1966 and that mesne profits at Rs. 10 per day for the relevant period were justified. The Court also held that interest awarded on mesne profits was permissible because "mesne profits" as defined in section 2(12) of the Code of Civil Procedure includes interest on such profits.

Holding and Implications

Holding: APPEAL DISMISSED.

The Court affirmed the trial court's decree: the lettings of the suit premises in November 1958 and November 1961 were void for contravention of Clause 22(2) of the C.P. & Berar Letting of Houses and Rent Control Order, 1949; the defendant was found to be in permissive possession/license which the plaintiff validly revoked; the plaintiff was entitled to possession, mesne profits at the rates awarded by the trial court (including the higher daily rate for the specified period) and interest on mesne profits.

Implications as articulated in the opinion:

  • The Rent Control Order's Clause 22(2) constitutes an express statutory prohibition on occupation except in the specified manner; a letting made in breach of that provision is void because its object is forbidden by law.
  • Authorities construing a different statutory regime (notably the U.P. Act and decisions applying it) are distinguishable where the statutory text does not contain the same express prohibition; therefore such authorities (e.g., Udhao Das, as applied in Murlidhar) are not controlling for the Rent Control Order's construction.
  • Estoppel or prior procedural steps taken by a landlord do not validate or permit enforcement of an agreement which is illegal under the statutory prohibition; courts will not enforce terms that are declared illegal by statute.
  • The plaintiff may recover mesne profits at proven market rates for the period of wrongful occupation and interest on those mesne profits is recoverable under the relevant provision of the Code of Civil Procedure.

Direct effect on the parties: the decree in favour of the plaintiff is upheld; the defendant remains dispossessed and liable for mesne profits and interest as awarded. The Court framed its decision by applying existing statutory provisions and authorities; it distinguished other authorities based on differences in statutory language.

Disposition: Appeal dismissed with costs.

    Kakubhai And Company By Proprietor Kakubhai Haridas Kapadia v. Nathmal Kisanlal Goenka .

    Gadgil, J.:— This is defendant's appeal challenging the decree passed against him in Special Civil Suit No. 16 of 1966 of the file of the Civil Judge, Senior Division, Akola.

    2. The litigation pertains to the shop premises situate at Akola. They are part of house No. 92 in ward No. 29. This house is of the ownership of the plaintiff since 2-2-1954 as on that date the plaintiff purchased it from the previous owner Messrs Sawatram and Sons Limited under the sale deed Ex. 117. Deceased Shiojibhai was occupying in all three blocks or tenements in the said house as a tenant since before this purchase. There is no dispute that Shiojibhai left possession of one of the blocks sometime in 1956. Thereafter the two blocks continued in possession of Shiojibhai on the rent of Rs. 1,761 per year. Shiojibhai died on 9-3-1958 leaving behind him his daughters and two brothers by name Shamjibhai and Hansraj. There is no dispute that these three brothers had already partitioned their estate on 15-11-1948 under the partition deed Ex. 128.

    3. The plaintiff's case in brief is that by Diwali 1958 i.e by about 11-11-1958 both the blocks were given in possession of the plaintiff and thereafter one of the blocks, namely, the suit premises were taken on lease by Shamjibhai on a monthly rent of Rs. 100. Till next Diwali, (i.e October-November 1959) Shamjibhai alone was the tenant of that block. At this stage we would like to state that it is this block which is the subject-matter of this litigation. Thereafter from October-November 1959 till October-November 1961 Shamjibhai and the present defendant Kakubhai were jointly possessing the suit premises as tenants on the rent of Rs. 100 per month. The plaintiff further alleges that after November 1961 (after Diwali 1961) the defendant alone continued as a tenant, and since then he has been paying rent. The plaintiff, however, contends that the lease of the suit premises initially to Shamjibhai in 1958 and thereafter to Kakubhai in 1961 was bad and inoperative, inasmuch as it was in contravention of the provisions of the C.P and Berar Letting of Houses and Rent Control Order, 1949 (hereinafter referred to as the Rent Control Order). Clause 22 of that Order prescribes that every landlord shall within seven days from the date on which a house becomes vacant or available for occupation give intimation about this fact to the Collector in the prescribed form and that he shall not let it or occupy it except in accordance with clause 23. Clause 23 states that on receipt of such intimation but within fifteen days thereof the Collector may order the landlord to let out the house to a person mentioned in the order. If no such order is passed, the landlord is entitled to let out the house to any person. The main allegation in the plaint is that the plaintiff has not given any intimation about the suit premises having fallen vacant in November 1958 when they were let out to Shamji. Similarly no intimation was given when the premises were let out to the defendant in October-November 1961. With this allegation it is contended that the transaction of lease is void as it is forbidden by law, and that, therefore, the defendant has been in possession either as a licensee or as a trespasser. The plaintiff had in 1965 filed two proceedings against the defendant one was Small Cause Suit No. 8 of 1965 claiming a decree for arrears of rent of Rs. 200, and the other proceeding was under clause 13 of the Rent Control Order. That clause provides that a landlord can terminate the tenancy of a tenant only after obtaining previous permission of the Rent Controller. The grounds on which such permission can be granted are enumerated in clause 13(3). Both these proceedings were, however, withdrawn by the plaintiff. For example, Ex. 115 is a copy of the order-sheet in Small Cause Case No. 8 of 1965 showing that the suit was dismissed for default. Similarly the order-sheet Ex. 114 shows that the Rent Control Case No. 211/71/64-65 was disposed of for want of prosecution. The plaintiff has alleged in the plaint that these proceedings were filed on a mistaken belief that the defendant was a lawful tenant. It is further contended that the proceedings were withdrawn as soon as the plaintiff came to know that the lease in favour of the defendant was void. The plaintiff, therefore, filed a suit under appeal claiming possession and mesne profits. Rs. 1436.66 were claimed as mesne profits from October-November 1964 till 4-1-1966 at the rate of Rs. 100 per month. Another item of mesne profits consists of Rs. 2,160 so as to cover the period from 4-1-1966 to 8-8-1966 at the rate of Rs. 10 per day.

    4. The defendant resisted the suit by his written statement Ex. 26. In substance, he contended that since the time when Shiojibhai was alive, the defendant has been in possession along with Shiojibhai and after his (Shiojibhai's) death, with Shamjibhai. He denied that in November 1958 possession of both the blocks was handed over to the plaintiff or that thereafter the suit premises were separately taken on rent by Shamjibhai. According to him, the lease that was operative at the time of Shiojibhai's death continued even after the death of Shiojibhai. He pleaded that he was working with Shiojibhai in the shop premises as Shiojibhai's grandson and as such was entitled to the interest in the estate of deceased Shiojibhai as well as of his heirs. The defendant further pleaded that after Shiojibhai's death, the plaintiff agreed that the old lease would subsist and that on or about 22-11-1958 the plaintiff accepted Shamjibhai as a tenant along with the defendant. It was further pleaded that possession was not handed over to the plaintiff at any time and that, therefore, there was no necessity for giving intimation to the Rent Controller under clause 22 of the Rent Control Order. The defendant denied that the lease in his favour is void. His another contention is that after having accepted the defendant as a tenant, the plaintiff is now estopped from taking the plea that the lease is void. The defendant made a reference to the Rent Control proceedings and the Small Cause Suit that was filed by the plaintiff and then contended that the plaintiff is also estopped on account of taking such steps on the basis that the defendant was a tenant. The defendant denied that he is either a licensee or a trespasser. He also denied his liability to pay any mesne profits.

    5. The learned Civil Judge, Senior Division, heard the suit after framing necessary issues. In substance, he came to the conclusion that by October-November 1958 the plaintiff obtained possession of the two blocks and that thereafter the suit premises were let out to Shamjibhai. The trial Court also held that the suit premises were occupied by the defendant along with Shamjibhai from Diwali of 1959 to Diwali of 1961 and that thereafter the defendant alone occupied the premises as a tenant. It was held that no intimation was given to the Rent Controller when Shamjibhai or the defendant was put in possession of the suit premises as a tenant. A finding was recorded that the lease in favour of Shamjibhai as also of the defendant is void on account of the absence of such intimation. The learned Civil Judge found that the defendant has been in permissive possession and as such a licensee. The said licence was treated as revoked on account of the plaintiff's notice. The suit was, therefore, decreed and hence this appeal.

    6. Mr. Dharmadhikari for the appellant submitted that the entire approach to this litigation is erroneous, inasmuch as there was no vacancy in November 1958 as also in November 1961 and as such it was not necessary to give any intimation of such vacancy to the Collector under clause 22 of the Rent Control Order. We have already referred to the contentions raised by the defendant in this respect. According to the defendant, Shiojibhai, Shamjibhai and the defendant were in possession of the premises during the lifetime of Shiojibhai and that after his death Shamjibhai and the defendant continued to be in possession. This joint possession came to an end by November 1961 and since then the defendant is in exclusive possession and that too as a tenant. Of course, the plaintiff has denied this position. However, we think that the evidence on record does indicate that actual physical delivery of possession in November 1958 had not taken place. Similarly, it appears that the defendant was doing some work in the shop even during the lifetime of Shiojibhai. Plaintiff Nathmal (Ex. 140) has made a statement in the cross-examination (paragraph 4) that the defendant might be sitting in the shop of Shiojibhai during Shiojibhai's lifetime. Nandlal Mehta (D.W 1) was serving with Shiojibhai. He has stated that the possession of the suit premises was never given up by Shiojibhai and that after his death the defendant has been in possession. He has also stated that the defendant used to sit in the shop of Shiojibhai as his relative and not as a servant. Shamjibhai (D.W 2) has given similar deposition by stating that Shiojibhai never left possession of the premises. His evidence indicates that he wants to say that even after Shiojibhai's death the possession of the suit premises has not been given to the plaintiff. Defendant Kakubhai (D.W 3) has entered the witness-box and has stated that possession was never handed over to the plaintiff. He has also added that he used to carry on his work in the suit premises. He has added that the electric meter in the suit premises is still in the name of Shiojibhai. Mr. Dharmadhikari relied upon all this evidence for the purpose of contending that there was no physical delivery of possession as alleged by the plaintiff. Mr. Bobde for the respondent, however, submitted that the receipt Ex. 113 dated 22-11-1958 would be a good proof that possession was actually delivered to the plaintiff by Diwali of 1958. Ex. 113 is a receipt executed by Shamjibhai in favour of the plaintiff. It appears that Shiojibhai had advanced a loan of Rs. 25,000 to the plaintiff on a pro-note. Rs. 10,000 were returned to Shiojibhai during his lifetime. On 22-11-1958 the accounts of this loan-transaction were made. Rs. 13232.25 were found due towards principal and interest on that much amount was paid and the debt was satisfied. While making the accounts the rent amount of Rs. 3194/4 that was payable by Shiojibhai to the plaintiff was also taken into account. At the fag end of the receipt there is a statement that all the shops which were in possession of Shiojibhai were delivered to the plaintiff by October-November (Diwali) 1958. It is true that this receipt does contain a statement about delivery of possession. However, we think that there was no physical delivery. It seems that the question arose as to how and in what capacity the two blocks should be in possession of Shiojibhai and others. The parties agreed that one block should be handed over to the plaintiff. Thus there was physical delivery of possession of that block while the other block, namely, the suit premises was decided to be continued with Shiojibhai as a tenant.

    7. It was further contended that the manner in which the plaintiff made accounts of the rent paid from time to time would give an indication that the plaintiff never treated Shiojibhai as the lone tenant. Much stress is laid on the payment made on 12-1-1962 under the receipt Ex. 108 It shows that the defendant paid the rent of Rs. 1200 (for 12 months) to the plaintiff and hence a receipt in favour of the defendant was passed. But the extracts of the plaintiff's accounts (Ex. 139) show that the amount of Rs. 1200 was credited as paid by Shiojibhai. This circumstance coupled with the abovementioned evidence of the defendant sitting in the suit premises since the lifetime of Shiojibhai has been relied upon for the purpose of contending that the premises were held not by Shiojibhai alone and that he along with Shamjibhai and the defendant were enjoying the premises. It was also urged that the joint enjoyment continued by Shamjibhai and the defendant after Shiojibhai's death. It is in this manner that Mr. Dharmadhikari argued that the lease continued even after Shiojibhai's death and as such there was no vacancy. In addition, it was urged that there was no physical possession of the suit premises at any time.

    8. Thus the position is that the defendant was sitting in the suit premises since the time of Shiojibhai's death and that there was no actual physical delivery of possession of the suit tenement in October-November 1958. The question, however, is as to what would be the effect of the legal relationship between the parties. We have already observed that Shiojibhai and Shamjibhai were separate since 1948. Thus, Shamjibhai cannot claim any interest in the property (including the leasehold property) of Shiojibhai. The defendant is the daughter's son of Shiojibhai, but is in evidence that Shiojibhai's daughters were alive at the time of his death. The tenancy rights over the suit premises can devolve only by inheritance. The mere fact that the defendant was sitting in the shop of Shiojibhai as a close relative of Shiojibhai would not make him as a joint tenant along with Shiojibhai. It will not, therefore, be possible for the defendant to contend that after Shiojibhai's death the same old lease continued in favour of the defendant. The fact that by Diwali of 1958 the possession of the suit premises was not physically handed over to the plaintiff would not be of any use, particularly when since November 1958 Shamjibhai was treated as an independent and separate tenant of the suit premises. The position has been made clear by Shamjibhai in paragraph 4 of his evidence. He has stated that as the receipt was passed in his name, he became the tenant of the plaintiff for the suit premises. The net result of the above discussion is that after the death of Shiojibhai, Shamjibhai became a separate tenant of the suit premises with effect from November 1958. For the next two succeeding years Shamjibhai and the defendant were the joint tenants and thereafter since November 1961 the defendant became the exclusive tenant of the plaintiff.

    9. There was thus a fresh letting of the suit premises in November 1958 in favour of Shamjibhai. In addition, there was another letting in November 1961 to the defendant. The fact that actual physical possession was not handed over when these fresh tenancies were created would not be of any use to the defendant. A similar point had arisen before this Court in Second Appeal No. 286 of 1962 decided on 7-1-1970 (digested at Note No. 21 in 1970 Mh. LJ Notes). In that case the owner of the property sold it to another and he continued in possession in the capacity as a tenant by executing a rent note. The question arose as to whether an intimation about the vacancy was required to be given when the owner changed the character of his possession as that of a tenant. This Court has held that notional vacancy is created on account of such transaction and that a notice under clause 22 of the Rent Control Order was essential. It was further held that the tenancy created without giving such intimation is illegal and that the landlord cannot sue for ejectment on the basis of termination of a void tenancy. The question as to whether the tenancy created without giving any intimation to the Rent Controller is void or not will have to be considered in more details at a later stage. However, for the present suffice it to say that there would be a vacancy as soon as the suit premises were let out by the plaintiff to Shamjibhai in 1958 and thereafter to the defendant in 1961.

    10. It is common ground that the plaintiff has not given any intimation about this vacancy as contemplated by clause 22 of the Rent Control Order. What would be the effect of the non-observance of this provision? Would the lease be void as the consideration or the object is forbidden by law, or would it be valid between the parties without affecting the rights of the Rent Controller to take necessary steps for eviction of the defendant? Mr. Dharmadhikari submitted that an omission to give an intimation under clause 22 would not make the lease void. According to him, the transaction will be quite legal so far as the parties are concerned. Mr. Bobde, however, argued that such a lease would be bad in law. He relied upon the decision of this Court in Civil Revision Application No. 396 of 1959 decided on 26-9-1960 (digested at Note 27 in 1961 NLJ Notes). It was held in that case that a lease in contravention of the provisions of clauses 22 and 23 of the Rent Control Order was void. A similar view has been taken by this Court in Second Appeal No. 266 of 1963 decided on 11-3-1971 (digested at Note No. 64 in 1971 Mh. L.J Notes).

    11. Mr. Dharmadhikari, however, contended that the above decisions would not be good law in view of the recent decision of the Supreme Court in the case of Murlidhar v. State of U.P . 1974 2 SCC 472. It was a case under section 7 of the U.P (Temporary) Control of Rent and Eviction Act, 1947. Section 7(1) of that Act lays down that every landlord shall give a notice of vacancy within seven days after the accommodation becomes vacant. The tenant is also under a liability to give such intimation under that section. Sub-section (2) provides that the District Magistrate, by general or special order, may require a landlord to let or not to let any accommodation which is or has fallen vacant to any person. In the case before the Supreme Court the premises had fallen vacant. However, they were let out to a tenant without giving any intimation to the District Magistrate. A proceeding was taken under section 7-A of the Act for eviction of the tenant on the ground that he was an unauthorised occupant. That section enables the District Magistrate to take action against any person who is in unauthorised occupation of the accommodation. As per the proviso to that section the District Magistrate is given a discretion not to take any action if there was undue delay or if the District Magistrate otherwise finds it inexpedient to do so. The District Magistrate in due course passed an order for eviction. The matter ultimately went to the State Government. The said order of the District Magistrate was set aside. It is this order that was challenged in the High Court by a writ petition. A Single Judge of the Court quashed the order. This order was reversed in appeal and hence the matter was taken in appeal to the Supreme Court. Mr. Dharmadhikari relied upon the following observations in paragraph 16 of the Supreme Court Judgment:

    “In Udhao Das v. Prem Prakash . 1963 All. L.J 406 a Full Bench of the Allahabad High Court took the view that a lease made in violation of the provisions of section 7(2) would be valid between the parties and would create the relationship of landlord and tenant between them although it might not bind the authorities concerned. In the light of this ruling the correctness of which we see no reason to doubt we think that the respondent was a tenant.”

    It was contended on behalf of the appellant that the principle enunciated by the Supreme Court in the above mentioned case will apply to the facts in the present case. It was urged that the provisions of the U.P Act and the Rent Control Order are analogous and as such a finding be recorded that a lease in favour of the defendant is valid even though no intimation of the vacancy has been given to the Collector. On the other hand, Mr. Bobde submitted that the facts as mentioned in the judgment reported in A.I.R 1964 All. 1 would show that the decision was based on the particular provisions of the U.P Act. He further contended that the provisions of the Rent Control Order are not similar to those of the U.P Act. According to him, the various provisions of the Rent Control Order would show that the intention was prohibit the letting of accommodation, without giving intimation to the Rent Controller and without allowing the Rent Controller to pass an order of allotment as contemplated by that Order.

    12. It will, therefore, be necessary to note the provisions of the two enactments and then to consider as to whether there is any special feature in the Rent Control Order so as to make it a distinguishing factor. We have already stated as to what section 7 of the U.P Act provides. We would, however, like to reproduce sub-sections (1) and (2) of that section:

    “Control of letting:— (1)(a) Every landlord shall, within 7 days after an accommodation becomes vacant by his ceasing to occupy it or by the tenant vacating it or otherwise ceasing to occupy it or by termination of a tenancy or by release from requisition or in any other manner whatsoever, give notice of the vacancy in writing to the District Magistrate.

    (b) Every tenant occupying accommodation shall within 7 days of vacation of such accommodation or ceasing to occupy it give notice thereof in writing to the District Magistrate.

    (c) The notice given under clause (a) or (b) shall contain such particulars as may be prescribed.

    (2) The District Magistrate may by general or special order require a landlord to let or not to let to any person any accommodation which is or has fallen vacant or is about to fall vacant.

    Section 8 of the Act prescribes a penalty for a person who contravenes the provisions of that Act. It is this provision that has been construed in detail by the Full Bench of the Allahabad High Court in the case reported in AIR 1964 All. 1. It will be advisable to reproduce certain observations from that case. For example, paragraph 6 of the judgment reads as follows:

    “Though the Act contains provisions referred to above punishing a person for letting out without permission or letting out in contravention of an order of allotment or refusing to let out in spite of an order of allotment and punishing abetment of the above acts and rendering a person liable to be evicted if he has occupied an accommodation in contravention of an allotment order or without vacancy of an accommodation having been reported, there is no provision whatsoever rendering a contract of tenancy entered into by a landlord and another person void or even illegal. If a landlord lets out an accommodation to Y when he was ordered by the District Magistrate to let it out to X or not to let it out at all, the Act makes him liable to prosecution and punishment but it does not invalidate the contract of tenancy. A person occupying an accommodation in contravention of an allotment order is liable to be evicted under section 7-A but the contract of tenancy made by him, if any, with the landlord is not rendered invalid by anything contained in the section itself. Whether a contract of tenancy is rendered invalid or void or not depends solely upon the provisions of the Transfer of Property Act and the Contract Act. In the present case we are not concerned with the provisions of the Transfer of Property Act because none of them is invoked as rendering the contract of tenancy between the respondent and the landlord void.”

    The material portion of paragraph 8 reads:

    “Allowing an accommodation to be used is not forbidden by any law; it is entering into a contract of tenancy in contravention of an order made under section 7(2) by a District Magistrate that may be said to be forbidden act. But it is an act forbidden by a District Magistrate and not by law within the meaning of section 23. An order made under section 7(2) by a District Magistrate may have the force of law but is not law. The U.P (Temporary) Control of Rent and Eviction Act does not contain any provision prohibiting the letting out of an accommodation by a landlord; it contains no such provision as ‘do not let out in contravention of an order made under section 7(2)’ or ‘do not let out in contravention of any provision contained hereunder or any order made hereunder’”.

    Paragraph 14 of the judgment shows that there was nothing on record to show that the District Magistrate of Kanpur had passed before 1-2-1952 a general order prohibiting landlords from letting out accommodation without his permission. It is further observed that if no general or special order of the District Magistrate was in existence on 1-2-1952, the question of disobedience of any such order on 1-2-1952 does not arise. Mr. Bobde, after relying upon the observations in the judgment, contended that the important factor that ultimately decided the case in favour of the validity of the lease was that there was no prohibition [as there was no order of the District Magistrate under section 7(2)] against letting out an accommodation by the landlord without giving any intimation. He also submitted that the Rent Control Order has made specific provision in that respect and that, therefore, in the present case it will not be open for the appellant to urge that the lease, though entered into without giving an intimation to the Rent Controller, is valid.

    13. We think that there is much substance in the above contention of Mr. Bobde. During the arguments various provisions of the Rent Control Order were read. But, according to us, the only relevant clauses that would be decisive are clause 22, and more particularly sub-clause (2) thereof, and clause 23. It would be beneficial to reproduce the entire clause 22 which reads as follows:

    “22.(1) Every landlord of a house situate in an area to which this chapter extends, shall—

    (a) within seven days from the date of the extension of the chapter, if the house is vacant on such date; or

    (b) within seven days from the date on which the landlord becomes finally aware that the house will become vacant or available for occupation by himself or for other occupation on or about a specified date: give intimation of this fact to the Collector of the district in which the area is included or such other officer as may be specified by him, in the Form given in the Schedule appended to this Order, and shall not let or occupy the house except in accordance with clause 23.

    (2) No person shall occupy any house in respect of which this chapter applies except under an order under sub-clause (1) of clause 23 or clause 24 or on an assurance from the landlord that the house is being permitted to be occupied in accordance with sub-clause (2) of clause 23.”

    This order has been passed in exercise of the power conferred by section 2 of the Central Provinces and Berar Regulation of Letting of Accommodation Act, 1946. Section 8 of that Act lays down a punishment for contravention of any order made under the said Act. It will be obvious from sub-clause (2) of clause 22 that there is a total prohibition which prevents occupation of any house unless there is an order under clause 23 or clause 24 or an assurance that the letting is permitted in accordance with clause 23(2). This clause thus lays down that there shall not be any occupation unless that occupation falls within the provisions of clause 23 or 24. clause 24 is not relevant for the decision of this case. It was contended by Mr. Bobde that giving effect to the lease in favour of Shamjibhai in 1958 or in favour of the present defendant in 1961 would be to permit occupation of the tenement in contravention of the provisions of the Rent Control Order. According to him, such occupation is prohibited by clause 22(2). He, therefore, argued that the consideration or the objects of the lease in question would be forbidden by law and as such it would not be a lawful object. Under section 23 of the Contract Act, a consideration or object which is forbidden by law is unlawful or every agreement with such unlawful consideration or object is void. Mr. Dharmadhikari, on the other hand, submitted that in spite of clause 22(2) a landlord would have a right to let out the property. According to him, the only effect of such letting is that the Collector or the Rent Controller can ignore such letting and can take appropriate action under clause 28. It is true that clause empowers the Collector to take such steps and to use such force as may be necessary for the purpose of securing compliance with, or for preventing or rectifying any contravention of the order. The grant of power to the Collector in this respect, however, would not necessarily mean that the occupation of a tenant in contravention of the Rent Control Order is valid. Everything will depend upon whether the Rent Control Order has permitted such letting. We feel that clause 22(2) gives a sure indication that the occupation of a tenant in breach of the Rent Control Order is not permitted. It would thus be clear that the provisions of the Rent Control Order are quite different from those of the U.P Act and as such the decision given on the construction of the relevant provisions of the U.P Act would not be applicable while construing the separate and somewhat different provisions of the Rent Control Order. Under these circumstances, the lease in question in favour of Shamjibhai and later on in favour of the defendant is hit by clause 22(2) and is, therefore, void as it is forbidden by law.

    14. Mr. Bobde also relied upon two more decisions of the Supreme Court. The first decision is of Jiwan Singh v. Rajendra Prasad . 1975 2 SCC 171. It is also a case under the U.P Act. The Supreme Court has lard down in that case that unless a landlord gives a notice in writing about the vacancy within the time specified in section 7, he would not be able to nominate his own tenant as contemplated by rule 4. The other decision is of Srikrishna v. A.D.M, Kanpur . 1975 2 SCC 361. In that case it is held that compromise between landlord and tenant in contravention of the provisions of the U.P Act and the Rules and more particularly so as to curtail the rights of the District Magistrate is unlawful. We do not think that any of these two decisions can be of much use for the purpose of deciding the controversy between the parties. Mr. Bobde also drew our attention to the recent Full Bench decision of the Allahabad High Court in the case of Abdul Hameed v. Mohd. Ishaq . AIR 1975 All. 166., wherein the previous Full Bench decision Udhoo Dass v. Prem Prakash has been overruled. However, this aspect is not necessary to be considered.

    15. Thus, a lease in contravention of the Rent Control Order would be void. A similar question about the unlawful subletting under the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947, is considered by the Supreme Court in the case of Waman Shriniwas v. Ratilal Bhagwandas & Co. . AIR 1959 sc 689.. section 15 of that act provided that notwithstanding anything contained in any law it shall not be lawful after the coming into operation of that Act for any tenant to sub-let the whole or any part of the premises let to him. It was held that in view of this provisions sub-letting would be illegal and void. We would, therefore, hold that the plaintiff is right in his contention that the lease in favour of the defendant is void as it contravenes the provisions of the Rent Control Order.

    16. It was next urged that the plaintiff would be estopped from making the contention about the void nature of the lease. We have already stated that the plaintiff had filed Civil Suit No. 8 of 1965 for recovering rent and Revenue Case No. 211/71/64-65 for getting permission under the Rent Control Order to terminate the defendant's tenancy. The said two proceedings were withdrawn. It was submitted that the filing of these two proceedings would prove that the plaintiff must have consented that the leases were valid. However, we feel that filing of the proceedings would not constitute estoppel, particularly when the question is about the validity or otherwise of a lease. The question of such estoppel has been considered by the Supreme Court in the above mentioned case of Waman Shriniwas v. Ratilal Bhagwandas & Co. We have already stated that there was a subletting by the tenant. In that case such sub-letting was made by the tenant is in pursuance of the permission that was incorporated in the agreement between the landlord and the tenant. In substance, the agreement provided that the tenant had a right to sub-let. On this basis, the contention was raised that the landlord would not be able to contend that there was an unlawful sub-letting so as to evict the tenant from the premises. This contention was rejected by the Supreme Court in the following words:

    “Assuming that to be so and proceeding on the facts found in this case the plea of waiver cannot be raised because as a result of giving effect to that plea the Court would be enforcing an illegal agreement and thus contravene the statutory provisions of section 15 based on public policy and produce the very result which the statute prohibits and makes illegal……. In the instant case the question is not merely of waiver of statutory rights enacted for the benefit of an individual but whether the Court would aid the appellant in enforcing a term of the agreement which section 15 of the Act declares to be illegal. By enforcing the contract the consequence will be the enforcement of an illegality and infraction of a statutory provision which cannot be condoned by any conduct or agreement of parties.”

    It will, therefore, not be possible for us to accept the contention of Mr. Dharmadhikari that there is any waiver or estoppel which would prevent the plaintiff from contending that the lease in question is void.

    17. It was next urged that the suit as framed is not tenable. The plaintiff has alleged that though the lease is void, still the possession of the defendant is of a permissive character and that the defendant was a licensee. A notice has been given to revoke the licence and thereafter the suit is filed. In the alternative, the suit is based on a pleading that the defendant is in possession as a trespasser. Thus, the suit is filed on the strength of title. It was contended that a party to a void contract cannot take advantage so as to prejudice the other side. We do not find as to how the plaintiff can be said to be taking undue advantage of the void contract. In fact, he has come before the Court within a statement that the defendant has obtained possession of the premises under a void contract and that possession should be restored to the plaintiff. Such a suit is quite legal and proper, particularly when it is based on title.

    18. It was next urged that the plaintiff would not be entitled to mesne profits at a rate higher than the agreed rate of rent. The grievance is about the grant of mesne profits at the rate of Rs. 10 per day from 4-1-1966 till the filing of the suit. It is true that the defendant agreed to pay Rs. 100 per month when he entered into the contract of lease in 1961. But the plaintiff has led evidence to show that rates of rents that were available in 1966. The learned Civil Judge, after considering that evidence, came to the conclusion that a claim of Rs. 10 per day is properly made out. The decree for mesne profits is thus quite legal.

    19. It was lastly urged that an interest of Rs. 58.32 should not have been allowed on the amount of mesne profits. However, the definition of the term “mesne profits” as given in section 2(12) of the Code of Civil Procedure shows that mesne profits include not only the profits as covered by the definition but also interest on such profits.

    20. The result, therefore, is that the appeal fails and dismissed with costs.

    Appeal dismissed.
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