Karnataka Rent Act, 1999 – s.46 – Revisional jurisdiction under – Exercise of – When not sustainable – Respondent No.1-Company, a partnership firm was a tenant under the appellant’s predecessor-landlord (since deceased) – However, Respondent No.1 had unlawfully sublet the premises and parted with possession in favour of third parties (Respondent Nos.2 and 3) who were not parties to the lease agreement, without the consent of the landlord – Eviction petition allowed by trial Court inter alia holding that that Respondent Nos.2 and 3 in actual occupation of the premises were strangers to the original tenancy and the tenant had unlawfully parted with possession in their favour – High Court allowed the revision petition filed by respondents – Whether the High Court was justified in interfering with the findings of fact recorded by the trial Court while exercising its revisional jurisdiction u/s.46: Held: No – Findings recorded by the trial Court were pure findings of fact based on proper appreciation of evidence – No perversity, illegality, or jurisdictional error was demonstrated – High Court transgressed the limits of its revisional jurisdiction by reassessing the evidence and substituting its own conclusions – Therefore, impugned interference u/s.46 is unsustainable in law as it effectively converted revisional jurisdiction into appellate jurisdiction – Impugned order set aside – Order of the trial Court directing eviction of the respondents, restored. [Paras 12.8, 12.9] Karnataka Rent Act, 1999 – Respondent No.1-Company, a partnership firm was a tenant under the appellant’s predecessor-landlord (since deceased) through its partnerRespondent No.4 – However, Respondent No.1 unlawfully sublet the premises and parted with possession in favour of third parties (Respondent Nos.2 and 3) who were not parties to the lease agreement, without the consent of the landlord – Landlord filed eviction petition, allowed by trial Court – High Court allowed the revision petition filed by respondents – Whether the burden of proving unlawful sub-letting lies upon the landlord, and if so, whether such burden was duly discharged in the present case:
Held: The lease deed recognized only Respondent No.4 as the tenant – Respondent Nos.2 and 3 were not parties to the lease and therefore, cannot claim any independent tenancy rights – The burden of proving unlawful subletting initially lay upon the landlord, which was duly discharged by establishing exclusive possession of third parties and absence of the original tenant – The burden thereafter shifted to the respondents, who failed to rebut the presumption by adducing cogent evidence – Consequently, unlawful sub-letting stands proved. [Paras 13.6, 13.8]
Karnataka Rent Act, 1999 – ss.27(2)(b)(ii) and 27(2)(p) – Subletting through the device of partnership – Respondents’ case rested on an alleged reconstitution of the partnership firm – Whether the alleged retirement of the original tenant-partner and continuation of business by Respondent Nos.2 and 3 constituted a mere reconstitution of partnership or amounts to unlawful sub-letting / assignment u/ss.27(2)(b)(ii) and 27(2)(p): Held: Sub-letting requires parting with legal possession, i.e., transfer of the right to exclusive possession – Mere induction or retirement of partners does not amount to sub-letting so long as the tenant retains control and legal possession – Courts are entitled to lift the veil of partnership where it is used as a device to conceal an impermissible transfer – Once exclusive possession of a third party is established, the burden shifts to the tenant to prove that the arrangement is bona fide – Thus, the determinative test is whether the original tenant continues to retain legal possession and control over the premises – Original tenant ceased to have any role in the business or the premises and Respondent Nos. 2 and 3 are in exclusive possession and control – Once such exclusive possession by third parties is established, the burden shifts to the respondents to prove that the arrangement is a genuine partnership and not a device to conceal sub-letting – Respondents failed to discharge this burden by producing any cogent or reliable evidence – They failed to produce the original partnership deed, any duly proved retirement deed, or any document evidencing continuity of the original tenant firm – No material to show that Respondent Nos.2 and 3 were partners in the original tenant firm – Their induction into possession is, therefore not traceable to the original tenancy – Original tenant divested himself of legal possession, and Respondent Nos.2 and 3, who are strangers to the tenancy, are in exclusive occupation of the premises without the consent of the landlord – The so-called reconstitution is nothing but a cloak to conceal an unlawful transfer of possession, warranting lifting of the veil – The arrangement cannot be regarded as a bona fide reconstitution of partnership and amounts to unlawful sub-letting / assignment within the meaning of s.27(2)(b)(ii) – Further, the continued occupation by Respondent Nos.2 and 3 without any lawful right, attracts s.27(2)(p) also – Therefore, respondents are liable to eviction – Impugned order set aside – Order of the trial Court directing eviction of the respondents, restored. [Paras 14.3, 14.6, 14.7, 14.9, 14.10, 15]
Tenancy – Eviction proceedings on ground of sub-letting – Burden of proof:
Held: Burden of proof lies upon the party asserting a fact – In eviction proceedings founded on the ground of sub-letting, the initial onus rests upon the landlord to establish that the tenant has parted with possession of the tenanted premises in favour of a third party without authority – The landlord discharges the initial burden by establishing (i) exclusive possession of a third party, and (ii) absence of the original tenant from possession – Upon such proof, a presumption of sub-letting arises, and the onus shifts to the tenant to demonstrate that such possession is lawful and not in the nature of sub-tenancy – It is established that the original tenant was no longer in possession, and Respondent Nos.2 and 3 were in exclusive occupation of the premises – Thus, the landlord successfully proved exclusive possession of third parties thereby discharging the initial burden and giving rise to a presumption of unlawful sub-letting – The burden, therefore, shifted upon the respondents to rebut the said presumption – However, the respondents failed to discharge this burden – No cogent or reliable evidence was adduced to establish the existence of a valid partnership, reconstitution deed, lawful induction, or consent of the landlord to such arrangement – In the absence of such evidence, the possession of Respondent Nos.2 and 3 remains unexplained and unlawful. [Paras 13.1, 13.5-13.7]
Karnataka Rent Act, 1999 – s.46 – Revisional jurisdiction under – Scope:
Held: Is narrowly circumscribed – It empowers the High Court to examine the legality, correctness or propriety of an order however, it does not confer appellate powers permitting re-appreciation of evidence or substitution of factual findings. [Paras 12.1-12.3] Karnataka Rent Act, 1999 – ss.46, 26 – High Court allowed the revision petition preferred by Respondents and set aside the eviction order – Respondents had inter alia placed reliance upon rent receipts:
Held: High Court while exercising jurisdiction u/s.46, undertook a fresh analysis of the evidence, including depositions of PW-1 and RW-1, partnership documents, and rent receipts, and arrived at independent factual conclusions – Such an exercise clearly amounts to reappreciation of evidence, which is impermissible in revisional jurisdiction – The statutory scheme provides for an appeal u/s.26 where the legislature has consciously created a separate appellate remedy, the revisional jurisdiction cannot be expanded so as to substitute or bypass the appellate mechanism – Furthermore, mere fact that rent receipts may continue in the name of the original tenant does not advance the respondents’ case, as it is legal possession and control and not the formality of rent payment, which is determinative. [Paras 12.6, 12.7, 14.8]
As published in the Supreme Court Reports, Supreme Court of India. Headnotes prepared by: Divya Pandey. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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