Case Note & Summary
The matter arose from an eviction suit filed by the landlord respondent against the tenant appellant under the Tamil Nadu City Protection Act, 1922. The first defendant, to whom open land was let out, had been carrying on individual business in the suit property. He later converted that business into a partnership firm named 'P.A. Thomas and Co.' taking the second defendant and another as partners. The landlord sought ejectment on the ground that the tenant had sublet the premises by transferring possession and control to the partnership firm without retaining effective control. The trial Court granted a decree of ejectment. The High Court affirmed the decree after remand and further evidence. Aggrieved, the tenant appealed to the Supreme Court. In an earlier judgment dated May 26, 1989, the Supreme Court had directed a finding on whether the first appellant had effective control over the management of the partnership business. On remand, the trial Court recorded further evidence. The High Court examined the evidence and found that paragraph 8 of the plaint stated the business of the first defendant was converted into a partnership and the second defendant was looking after the business; this averment was not specifically denied in the written statement. The High Court noted that the partnership deed was not produced in the trial Court or High Court, the first defendant did not examine himself as a witness, and the evidence of DW-1 (the second defendant) and DW-2 showed that the first defendant lived in Mundakkayam, Kerala while the business at Cumbum was run exclusively by the second defendant. DW-1 admitted that his father, the first defendant, was living in Mundakkayam and he as his son was doing the business in the suit property at Cumbum. DW-2 also stated that he remitted rent by money orders to the plaintiffs and later deposited rent in Court. Drawing an adverse inference against the first defendant for failure to testify, the High Court held that the first defendant was not in exclusive control of the business and that the second defendant was doing the business in the premises after conversion into partnership. The Supreme Court agreed with the High Court that this was a finding of fact and no question of law arose. The Court held that in view of the definition of 'tenant' under Section 2(4)(ii)(a) of the Tamil Nadu City Protection Act, 1922, the first defendant had converted individual business into a partnership business and was not having any control over the property or the business, and therefore it could be said that he sublet the property leased out to him to the partnership firm, thereby contravening the condition of ejectment. The appeal was dismissed with no order as to costs.
Headnote
A) Landlord and Tenant - Subletting - Effective Control - Tamil Nadu City Protection Act, 1922, Section 2(4)(ii)(a) - The first defendant, to whom open land was let out, converted his individual business into a partnership firm and lost effective control over the business and premises; the second defendant exclusively ran the business in the suit property. Held that this conversion and loss of control amounted to subletting the leased property to the partnership firm, contravening the condition of tenancy and rendering the tenant liable for ejectment. The Court found no question of law as it was a finding of fact after considering evidence and drawing adverse inference for non-examination of the first defendant. (Paras 1-2)
Issue of Consideration
Whether conversion of individual business into a partnership, with the original tenant losing effective control over management and premises, amounts to subletting and contravenes the condition of tenancy, thereby rendering the tenant liable for ejectment under Section 2(4)(ii)(a) of the Tamil Nadu City Protection Act, 1922.
Final Decision
The Supreme Court dismissed the appeal, holding that the first defendant had sublet the property to the partnership firm and thereby contravened the condition of ejectment. The decree of ejectment granted by the trial Court and affirmed by the High Court was not vitiated by any error of law. No costs.
Law Points
- A tenant who converts individual business into partnership and loses effective control over management and premises commits subletting
- effective control test determines tenant status under Section 2(4)(ii)(a) of Tamil Nadu City Protection Act
- 1922
- adverse inference for non-examination of tenant
- finding of fact on control not open to interference in second appeal.
