Full Judgment Text
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PETITIONER:
HELPER GIRDHIARBHAI
Vs.
RESPONDENT:
SAIYED MOHMAD MIRASAHEB KADRI AND OTHERS.
DATE OF JUDGMENT06/05/1987
BENCH:
MUKHARJI, SABYASACHI (J)
BENCH:
MUKHARJI, SABYASACHI (J)
NATRAJAN, S. (J)
CITATION:
1987 AIR 1782 1987 SCR (3) 289
1987 SCC (3) 538 JT 1987 (2) 599
1987 SCALE (1)1235
CITATOR INFO :
RF 1988 SC 852 (8)
ACT:
Bombay Rents, Hotel & Lodging House Rates Control Act,
1947: ss. 13 and 29--Tenant--Eviction of on ground of sub-
letting--Demised premises used for partnership
business--Lessee in legal possession-Held not enough to
prove subletting. High Court--Whether could reappraise
evidence in revision.
Partnership Act, 1932: ss. 4 & 6---Partnership--Determi-
nation of--Whether mixed question of law and fact.
HEADNOTE:
Sub-section (2) of s. 29 of the Bombay Rents, Hotel and
Lodging House Rates Control Act, 1947, as it stood at the
relevant time, barred further appeal against any decision in
appeal under sub-s. (1), and instead conferred revisionary
powers on the High Court in such a case.
The appellant-tenant was a partner in firm ’A’ which was
carrying on business of manufacturing cloth in the suit
premises. That business was closed on October 4, 1960 and a
new firm ’B’ came into being to run the business in manufac-
turing and selling neon sign tubes. On October 13, 1960 a
partnership deed was executed by six persons as partners of
the new firm. The document was silent as to where the busi-
ness was started. On or about October 24, 1960 another
partnership deed was executed by these six persons and the
appellant and his father with an agreement to share only
profits to the extent of 3 paise in a rupee. After the death
of the appellant on February 1, 1961 a new partnership deed
was executed by the remaining seven partners with the same
terms and conditions.
The respondent-landlord filed eviction suits against the
appellant defendant alleging that the premises which were
leased to the appellant for manufacturing cloth in the name
of firm ’A’ had been unlawfully sublet in major part to
defendants 2 to 5 who were running business in partnership
for manufacturing neon signs. The appellant contended that
firm ’A’ was not the tenant of the suit premises, that his
father was the original tenant with whom he had joined in
business as a partner in firm ’A’, that the suit premises
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were to be used for business and he
290
could use it for any business, that he had joined firm ’B’
in partnership, that the suit premises was with him and
defendants 2105 had not acquired any tenancy rights in the
suit premises, and that lie had filed a civil suit to dis-
solve the partnership, and to take account which was later
decreed in his favour and affirmed in appeal.
The trial court held that there was unlawful subletting,
and decreed the suit for possession. The appellate court,
Court of Small Causes, found that the appellant was only
carrying on the business in partnership with defendants 2 to
5 in the name of firm ’B’ in the suit premises, and held
that there was no subletting, change of user, and breach of
terms of tenancy. The High Court in revision on a reapprais-
al of evidence took the view that the partnership was a
camouflage and was never acted upon, and in fact and in
reality the partnership firm was a sub-tenant of the appel-
lant.
In the appeal by special leave it was contended for the
appellant that there was a genuine partnership which was
acted upon and this finding of the appellate court could not
have been reversed by the High Court in revision under s.
29(2) of the Act. For the respondents it was contended that
the original first partnership deed did not mention that the
appellant or his father was a partner, that it was in the
second partnership deed that the appellant and his father
joined the firm, that there was a gap of time when there was
user by the partnership firm of the premises in question
when the appellant was not a member of the firm, which fact
was not considered by the appellate court, and that the
partnership deed was a camouflage.
Allowing the appeal,
HELD: 1. The High Court exceeded its jurisdiction under
s. 29(2) of the Bombay Rents, Hotel and Lodging House Rates
Control Act, 1947 in reversing the view of the appellate
court. [305BC]
2.1 The distinction between an appeal and revision is a
real one. A right to appeal carries with it a right of re-
hearing on law as well as fact, unless the statute confer-
ring the right to appeal limits the re-hearing in some way.
The power to hear a revision is generally given to a superi-
or court to ensure that the principles of law have been
correctly borne in mind, that the facts have been properly
appreciated and a decision arrived at taking all material
and relevant facts in mind, that the decision is such which
a reasonable man could have arrived at and which does not
lead to a miscarriage of justice. [301H-302A; 303EF]
291
2.2 The Court must guard itself against permitting in
the guise of revision substitution of one view where two
views are possible and the appellate court has taken a
particular view. If a possible view has been taken, the High
Court would be exceeding its jurisdiction to substitute its
own view with that of the courts below because it considers
it to be a better law. The fact that the High Court would
have taken a different view is wholly irrelevant. Whether
there was a partnership or not is a mixed question of law
and fact, depending upon the varying circumstances in dif-
ferent cases. [303FG; 304E]
Hari Shankar v. Rao Girdhari Lal Chowdhiry, [1962] 1
Suppl. SCR 933; Puranchand v. Motilal, [1963] Suppl. 2 SCR
906; Krishnawati v. Hans Rai, [1974] 2 SCR 524; Phiroze
Bamanji Desai v. Chandrakant M. Patel & Ors., [1974] 3 SCR
267; Bhai Chand Ratanshi v. Laxmishankar Tribhavan, [1982] 1
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Rent Control Journal 242; M/s Kasturbhai Ramchand Panchal &
Brothers and Others v. Firm of Mohanlal Nathubhai and Oth-
ers, AIR 1969 Gujarat 110 and Punamchandra Revashankar Joshi
v. Ramjibhai Maganlal. 7 Gujarat Law Reporter (1966) at page
807, referred to.
In the instant case, the ’Court of Small Causes consid-
ered the principles of law, evaluated the evidence and held
that there was in fact and in law a partnership. Such a view
was not an impossible one or a perverse one. Therefore,
there was nothing that could be done about such a view
within the ambit and scope of the revisional powers under s.
29(2) of the Act and the High Court could not have substi-
tuted its own finding for the one reached by the appellate
court. [404H-305A; 304D]
3. Whether the ingredients of partnership as embodied in
the law of partnership were there or not in a particular
case must be judged in the fight of principles applicable to
partnership, that is (1) there must be an agreement entered
into by all the persons concerned, (2) the agreement must be
to share the profits of a business, and (3) the business
must be carried ou by all or any of the persons concerned
acting for all. Sharing of profits and contributing to
losses are not the only elements in a partnership, existence
of agency is essential. [296FG; 304G; 304E]
Chimanram Motilal and Another v. Jayantilal Chhaganlal
and another, AIR 1939 Bombay 410 and Mohammed Musa Sahib
(dead) and Others v. N.K. Mohammed Ghouse Sahib and Another,
AIR 1959 Madras 379, referred to.
In the instant case, judged by these principles it could not
be said
292
unequivocally that there was no partnership. The partnership
deeds gave the appellant the right to share the profits’ and
made him an agent for certain limited purposes of the firm
and there was evidence that the partnership deeds were acted
upon. It is true that the bank accounts were not to be
operated by the appellant, that he was to be given a fixed
percentage of profit irrespective of profit and that he was
not to share the losses. There is nothing inherently illegal
or improper in making provision of such a type. In the eyes
of law such a claim is really non-sequitur or neutral prov-
ing neither the existence nor non-existence of a genuine
firm. The appellant was to bring in his asset being the
tenancy of the premises in question for the user of the
partnership. Debiting the fixed amount payable to the appel-
lant in the expenses account is also not inconsistent with
partnership. This is also not inconsistent with treating the
rent of the firm in the context of the total expenditure of
the firm. There was evidence of a suit of dissolution of the
partnership where none of the partners took the plea that it
was a false or a fictitious document. Though the decree in
the dissolution suit was not binding in these proceedings
inter se between the parties as partners, it is a piece of
evidence which cannot be wholly ignored. All these factors
were present before the appellate court. These were reap-
praised by the High Court. [304G; 298A; 297B; 298C; 297C;
301A; 298B]
4. The partnership firm was carrying on business in the
premises in question since October 4, 1961. If there was
such a partnership firm of which the appellant was a partner
as a tenant the same would not amount to subletting leading
to forfeiture of the tenancy, for there cannot be a sublet-
ting, unless the lessee parted with the legal possession.
The mere fact that another person is allowed to use the
premises while the lessee retains the legal possession is
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not enough to create a sublease. [294FG; 305B]
Madras Bangalore Transport Co. (West) v. Inder Singh and
others, [1986] 3 SCC 62; Mehta Jagjivan Vanechand v. Doshi
Vanechand Harakhchand and others, (AIR 1972 Gujarat 6) and
Gundalapalii Rangamannar Chetty v. Desu Rangiah and others,
(AIR 1954 Madras 182), referred to.
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3551 of
1979.
From. the Judgment and Order dated 20/21.8.1979 of the
Gujarat High Court in C.R. Appln. No. 1218 of 1977.
293
Dr. Shankar Ghosh, P.H. Parekh and Ayesh Misra for the
Appellant.
T.U. Mehta, R.C. Bhatia and P.C. Kapur for the Respondents.
The Judgment of the Court was delivered by
SABYASACHI MUKHARJI, J. Whether the appellant herein and
his father had sublet the premises in question in or about
1960 in terms of section 13(1)(e) of the Bombay Rents, Hotel
and Lodging House Rates Control Act, 1947 (hereinafter
called the ’Rent Act’) is’ the question involved in this
appeal by special leave from the judgment and order of the
High Court of Gujarat dated 21st of August, 1979.
In order to decide this question, it is necessary to
decide the scope and ambit of section 29(2) of the Rent Act.
To decide this, facts must be referred to.
The appellant claimed to be the tenant in respect of the
two premises which are quite adjacent to each other, one of
which is involved in this appeal. The respondent is the
landlord of the two premises and these were situated at
Raikhad Ward, Ahmedabad. The respondent had alleged in the
two suits that the appellant was his tenant in the suit
premises which were leased out to him and before him his
father, for conducting the business in the name of Ahmedabad
Fine & Weaving Works and according to the terms of tenancy
suit premises were leased for manufacturing cloth in the
name of Ahmedabad Fine & Weaving Works. The respondent had
further alleged that the appellant No. 1 had closed the
business and he was not using the said premises for the
purpose for which it was let to him. It was the case of the
appellant that in respect of the suit premises he was carry-
ing on his business with respondents Nos. 2, 4 and 5 in the
name of respondent No. 2, M/s. Bharat Neon Signs (hereinaf-
ter referred to as respondent No. 2).
We are concerned in this appeal with only one of the
premises which was involved in Suit No. 553 of 1969. It is
not in dispute and it never was that the premises was being
used by Bharat Neon Signs firm being the defendant No. 2 in
the original suit. At the time of the institution of the
suit the defendants Nos. 2 to 5 were admittedly the part-
ners. The present appellant who was the original defendant
No. 1 claimed to be a partner. The main controversy was
whether the appellant had sublet the premises to defendant
No. 2, Bharat Neon Signs or
294
whether he being a partner of the said firm had permitted
the said firm to use the premises in question. It is clear
from the evidence on record that the partnership firm had
undergone metamorphosis from time to time and again ever
since the year 1960. The firm Bharat Neon Signs first origi-
nated on 4th of October, 1960. As many as six persons were
named in the partnership firm, on or about 4th of October,
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1960 and they had executed a deed of partnership on 13th of
October, 1960 which is Exhibit-114 on the record. The said
partnership deed records six persons who were to run the
business in manufacturing and selling Bharat Neon Signs
tubes. However, the document is silent as to where the
business was started. On or about 24th of October, 1960
another partnership deed being Exhibit-69 came to be execut-
ed among the six persons and the father of the appellant
Girdharlal. The document is Exhibit-69 and is signed by the
father of the appellant and the appellant himself also. It
may be mentioned that the partnership deed Exhibit-114 was
executed by six persons and at that stage the appellant or
his father were not partners in the firm. But thereafter
when the partnership deed Exhibit-69 was executed the appel-
lant and his father joined the firm with an agreement to
share profits only and their share was fixed at 0.03 paise
in a rupee. There is a third partnership deed Exhibit-70
which showed that the deceased tenant Girdharlal had died on
1st of February, 1961 and so by the remaining seven partners
with same terms and conditions, a new partnership deed being
Exhibit-70 was executed on 22nd September, 1961. At this
time the share of the appellant was fixed at 0.03 paise in a
rupee to share the profits only. In 1965 some partners
retired and the remaining four partners executed a fresh
partnership deed Exhibit-117 on 1st April, 1965. This last
partnership deed was executed by the appellant and original
defendants Nos. 3, 4 and 5.
The main question in issue in this appeal as well as before
the High Court in revision was whether there was a genuine
partnership at the appellant was a partner. It is true that
since after 4th of October, 1960 the partnership firm was
carrying on business in the premises in question. It is well
settled that if there was such a partnership firm of which
the appellant was a partner as a tenant the same would not
amount to subletting leading to the forfeiture of the tenan-
cy. For this proposition see the decision of the Gujarat
High Court in the case of Mehta Jagjivan Vanechand v. Doshi
Vanechand Harakhchand and others, A.I.R. 1972 Gujarat 6.
Thakkar, J. of the Gujarat High Court, as the learned Judge
then was, held that the mere fact that a tenant entered into
a partnership and allowed the premises being used for the
benefit of partnership does not constitute assign-
295
ment or subletting in favour of the partnership firm enti-
tling a landlord to recover possession. This view is now
concluded by the decision of this Court in Madras Bangalore
Transport Co. (West) v. Inder Singh and others, [1986] 3
S.C.C. 62.
The trial court in the instant appeal held that there
was subletting. It accordingly decreed the suit for posses-
sion instituted by the landlord. The suit, inter alia, was
filed by the landlord on the ground of subletting. There was
an appeal before the Court of Small Causes, Bombay and by
judgment and order delivered by the Court of Small Causes,
Bombay on 18th of August, 1977, it was held that the learned
Trial Judge had erred in passing a decree for possession on
the ground of subletting, change of user and breach of terms
of tenancy. In the premises, the appeal was allowed. It may
be mentioned that the respondent No. 1 is the landlord of
two premises which were quite adjacent as mentioned before.
The respondent-plaintiff had alleged in both the suits that
the appellant was his tenant in the suit premises which were
leased to him for conducting his business in the name of
Ahmedabad Fine & Weaving Works, and according to the terms
of tenancy suit, the suit premises were leased for manufac-
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turing cloth in the name of Ahmedabad Fine & Weaving Works.
The landlord had alleged that the appellant had closed that
business and he was not using the premises in question for
the purpose for which it was let to him. It was further
alleged by the landlord that the appellant had unlawfully
sublet the major part of the premises in question of both
the suits to defendant Nos. 2 to 5 in the original suit and
these defendants were running business in partnership for
manufacturing of neon signs in the name of Bharat Neon
Signs. It was further alleged that the appellant had also
unlawfully sublet one room of the suit premises to defendant
No. 6 in Suit No. 553 of 1969 who was residing in that room.
For the purpose of the Suit No. 553 of 1969 with which the
appeal is concerned, it is relevant to state that the appel-
lant had raised the contention that Ahmedabad Fine & Weaving
Works was not the tenant of the suit premies but the suit
premises was tenanted by the father of the appellant Gird-
harlal Chimalal in 1938 and he was the original tenant of
the premises and appellant subsequently joined the business
of his father as a partner and the name of the partnership
firm was Ahmedabad Fine Weaving Works. He has stated further
that the suit premises were to be used for business and he
could use it for any business and he joined in partnership
with Defendants Nos. 2 to 5 somewhere in 1961 to prepare
neon signs and the defendants Nos. 2 to 5 were his partners
and doing business in the suit premises. He contended fur-
ther that the suit premises was with him and the
296
defendants Nos. 2 to 5 had not acquired any tenancy rights
in the suit premises. It is further stated that he had filed
a civil suit to dissolve the partnership and to take account
and his suit was pending in City Civil Court. It may be
mentioned that by the time the revision petition came to be
decided by the High Court the suit had been decreed in his
favour directing a dissolution of the said partnership and
directing taking of the accounts. There was an appeal filed
from that decree and that appeal was also dismissed and
disposed of affirming the decree for the dissolution of the
partnership, inter se between the parties being the partners
of the said firm. These facts were accepted that there was a
partnership. As mentioned hereinbefore the learned trial
Judge consolidated both the suits and in the instant suit
being No. 553 of 1969 with which this appeal is concerned,
it was held by the learned trial Judge that there was unlaw-
ful subletting. There was a decree for possession.
This was set aside in appeal. The Appellate Court so far
as the material for the present appeal is concerned held
that there was no subletting and there was only carrying on
of the business in partnership with defendants Nos. 2 to 5
in the name of Bharat Neon Signs. Therefore, the first
question that had to be decided by the Appellate Court being
the Court of Small Causes, Bombay and if a revision lay
before the High court was whether there was any genuine
partnership. The partnership deeds were there, the appellant
was not to share in the losses. The Court of Small Causes
came to the conclusion on an analysis of the evidence before
it and the terms of the three partnership deeds referred to
hereinbefore that there was a genuine partnership in law
which was acted upon. The High Court in revision reversed
that finding. The first question therefore, is, whether the
High Court could do so in the facts of this case and second-
ly whether the High Court was right in so doing.
Whether there was a partnership or not may in certain
cases be a mixed question of law and fact, in the sense that
whether the ingredients of partnership as embodied in the
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law of partnership were there in.a particular case or not
must be judged in the light of the principles applicable to
partnership. The first question, therefore, is what is a
partnership? That has to be found in section 4 of the Indian
Partnership Act, 1932, it says "Partnership is the relation
between persons who have agreed to share the profits of a
business carried on by all or any of them acting for all"
(Emphasis supplied). Section 6 of the said Act reiterates
that in determining whether a group of persons is or is not
a firm, or whether a person is or is not a partner in a
firm,
297
regard shall be had to the real relation between the par-
ties, as shown by all relevant facts taken together. The
following important elements must be there in order to
establish partnership, (1) there must be an agreement en-
tered into by all parties concerned, (2) the agreement must
be to share profits of business; and (3) the business must
be carried on by all or any of the persons concerned acting
for all. The partnership deeds were there entitling the
petitioner to share in the partnership. It is true that in
the partnership deeds the bank accounts were not to be
operated by the appellant, and further that irrespective of
the profit the clause of the partnership deed provided that
there should be a fixed percentage of profit to be given to
the partner-appellant No. 1. The appellant was not to share
the losses. But there is nothing illegal about it. The
appellant was to bring his asset being the tenancy of the
premises in question for the user of the partnership. All
these tests were borne in mind by the Court of Small Causes,
Bombay in the appeal from the decision of the learned trial
Judge. The Appellate Court had considered the partnership
deeds. One point was emphasised by Mr. Mehta, learned coun-
sel appearing for the respondents, that the original first
partnership deed did not mention the appellant or his father
as a partner. It was in the second partnership deed that the
appellant and his father joined the firm. The firm started
as emphasised by Mr. Mehta on 4th of October, 1960 and it
was only on the 24th of October, 1960 the second partnership
deed was -executed. Therefore, it was emphasised that there
was a gap of time when there was user by the partnership
firm of the premises in question when the appellant was not
a member of the firm. It was emphasised that this aspect was
not considered by the Court of Small Causes and the High
Court, therefore, was justified in interfering with the
findings of the Court of Small Causes. We are unable to
agree. These deeds were there, the partners were cross-
examined, there was no specific evidence as to from what
date the firm started functioning from the particular prem-
ises in question. Secondly, it was emphasised by Mr. Mehta
that the partnership deed was a camouflage. It is evident
from the sales-tax registration and other registration
certificates and licences under the Shops and Establishments
Act that the partnership was registered in the name of the
appellant and the appellant was also indicated as a partner.
It was so in the Income Tax returns and assessments. There-
fore, it was submitted that the Court of Small Causes com-
mitted an error of law resulting in miscarriage of justice.
It was submitted by Mr. Mehta that once it was accepted that
the partnership deed was a mere camouflage the other subse-
quent acts and conducts were merely ancillary and were put
in a formal way. But the question is from the three deeds
itself which were examined in detail by the Court
298
of Small Causes and which were re-examined by the High Court
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could it be said unequivocally that there was no partner-
ship. The deeds gave the appellant the right to share the
profits and made him agent for certain limited purposes of
the firm and there was evidence that the partnership deeds
were acted upon. There was evidence of suit of dissolution
of the partnership where none of the partners took the plea
that it was a false or a fictitious document. Though the
decree in the dissolution suit was not binding in these
proceedings, inter se between the parties as partners it is
a piece of evidence which cannot be wholly ignored. All
these factors were present before the Court of Small Causes.
These were reappraised by the High Court. One point was
emphasised by Mr. Mehta that in the partnership deed which
is not necessary to recite the terms, the petitioner was
completely excluded in operating the bank accounts etc.
There is nothing inherently illegal or improbable making a
provision of such a type. In the eye of law, such a clause
is really non-sequitur or neutral proving neither the exist-
ence nor non-existence of a genuine firm.
The first partnership deed which is Exhibit-114 is dated
13th October, 1960. It recited that the partnership firm
should be presently started at Ahmedabad and the same should
later be started in another city. In this the appellant was
not a partner. Exhibit-69 at page 136 of Volume-II of the
paper-book is a partnership deed wherein Girdharlal the
father of the Appellant No. 1 and the appellant No. 1 joined
as partners. It recited that the partnership started from
4th of October, 1960 at Ahmedabad. It was registered in the
name of 7th and 8th partners, Girdharlal who was the appel-
lant and his father.It was recited that the work of the
partnership would be done by the parties of the fourth,
fifth, sixth, seventh and eighth as per advice and instruc-
tions of the first, second and third. All the work had been
done by some of the partners of which appellants were not
parties and that they had to do the said work as per in-
structions of the other partners. Clauses 6 and 7 of the
said partnership deed recited inter alia as follows:
"6. The year of accounts of our partnership shall be Aso
Vadi 30th day i.e. Diwali and the first account year is
decided to be the Aso Vadi 30th day of Samvat Year 2017.
While settling accounts at the close of the year, 33% amount
from the sum which may remain as net profit after deducting
all expenditures, viz interest, discount, rent of the shop,
rent of the godown, insurance, brokerage, travelling, tele-
grams, postage, salaries of employees, etc. shall
299
be carried to Reserve Fund and thereafter, in the sum that
remains as net profit, the shares of us the partners have
been fixed as under:-
Rs. Np.
1. Ratanlal Jivabhai. 0 - 16
2. Manubhai Lalbhai. 0 - 16
3. Keshavlal Mulchand. 0 - 05
4. Kantilal Bhogilal. 0 - 10
5. Virchand Keshavji. 0 - 23
6. Satyapal Jeshal. 0 - 24
7. Girdharlal Chimanlal. 0 - 03
8. Helper Girdharlal. 0 - 03
-----------------
0-100 i.e. Re. 1/-
7. While settling accounts at the close of the year, if the
sum less than Rs. 1500 falls to the 0-03 shares of the
partners of the seventh and eighth parts, the amount falling
short has to be debited towards the head of expenditure and
Rs. 1500 (fifteen hundred only) have to be paid in full to
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each of them two, and in those circumstances or if there be
loss, the parties of the seventh or eighth parts have not
been held liable therefore; and in the year or’ losses, it
has been decided to pay Rs. 1500 (fifteen hundred only) to
each of them, after debiting the same towards the head of
expenditure and in the year of losses nothing has to be
carried to the ’Reserve Fund’ and the loss has to be borne
by us to parties first to sixth parts in the following
proportion:-
1. Ratanlal Jivabhai 0 - 17
2. Manubhai Lalbhai 0 - 17
3. Keshavlal Mulchand 0 - 05
4. Kantilal Bhogilal 0 - 11
5. Virchand Keshavji 0 - 25
6. Satyapal Jeshal 0 - 25
0-100 i.e. Re. 1/-
300
Clause 8 empowered the operating of the bank accounts by
partners other than the appellant and his father. We find
intrinsically nothing improbable. It is embodied in the
deeds the functioning of the partnership. The third partner-
ship which is dated 22nd of September, 1961 also indicates
as parties of sixth part the name of the appellant. The
relevant portion of the partnership deed reads as follows:-
"To wit, the parties of the first to sixth parts out of us,
deceased Khristi Girdharbhai Chimanlal and Shah Virchand
Keshavji had jointly started the business of manufacturing
and selling Neon Signs Tubes, in partnership in Ahmedabad
from 4.10.1960, in the name and style of Bharat Neon Signs.
However, on account of the death of Khristi Girdharbhai
Chimanlal on 1.2.61 and other reasons, the said partnership
was dissolved from 8.9.61. Thereafter, we the parties from
the first to seventh part have, after purchasing at its cost
price, all the debts and dues, goods, stock etc., together
with goodwill of the dissolved partnership, started manufac-
turing and selling of Neon Signs Tubes in partnership from
9.9.61. We, the parties of all the seven parts execute the
deed of the said partnership to-day i.e. 22.9.61. The terms
and conditions thereof are as under:-
(1) The entire work of our partnership has to be
carried out in the name of "Bharat Neon Signs."
(2) The work to be carried out by our partnership
is of manufacturing and selling Neon Signs Tubes and of
obtaining orders therefore.
(3) Whatever moneys that may be required to be
invested in our partnership, are to be invested by the
parties of the first, second, third, fourth and seventh
parts out of us and the interest at the rate of 71/2 per
cent per annum has to be paid for the moneys that may be
invested in this partnership."
We are of the opinion that these were evidence that
these terms were acted upon. There was nothing intrinsically
wrong in law in constituting a partnership in the manner it
was done. It was contended by Mr. Mehta that there was no
agency; reading the partnership deeds as we have read that
conclusion does not emanate from position
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appearing debiting the fixed amount payable to the appellant
in the expenses account which also is not inconsistent with
partnership. This is also not inconsistent with treating the
rent of the firm in the context of the total expenditure of
the firm.
In any event all these factors were considered by the
Court of Small Causes bearing in mind the correct legal
principles. The High Court on a reappraisal of these very
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evidence came to the conclusion that the partnerships were
camouflages and were not acted upon and in fact and in
reality the partnership firm was a sub-tenant of the appel-
lant herein.
The question is, can the High Court do so in law. The
power of the High Court to revise the order is contained in
section 29(2) of the Bombay Rent Act as applicable at the
relevant time to Gujarat, The said provision reads as fol-
lows:
"29(2) no further appeal shall lie against any decision in
appeal under sub-section (1) but the High Court may, for the
purpose of satisfying itself that any such decision in
appeal was according to law, call for the case in which such
decision was taken and pass such order with respect thereto
as it thinks fit."
The ambit and power of revision generally and in particular
with respect to the provisions with which we are concerned
have from time to time come up for consideration by this
Court. This Court in Hari Shankar v. Rao Girdhari Lal Chowd-
hury, [1962] 1 Suppl. SCR. 933 had to consider section 35(1)
of the Delhi & Ajmer Rent Corntrol Act, 1952. The said
section reads as follows:-
"35(1) The High Court may, at any time, call for the record
of any case under this Act for the purpose of satisfying
itself that a decision made therein is according to law and
may pass such order in relation thereto as it thinks fit."
It was held in the majority judgment by HidayatuIIah, J.
as the learned Chief Justice then was, that though section
35 of the Delhi and Ajmer Rent Control Act was worded in
general terms but it did not create a right to have the case
re-heard. This Court emphasised that the distinction between
an appeal and revision is a real one. A right to appeal
carries with it right of re-heating on law as well as fact,
unless the statute conferring the right to appeal limits the
re-hearing in some
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way. The power to hear a revision is generally given to a
superior court so that it may satisfy itself that a particu-
lar case is decided according to law. The expression "ac-
cording to law" in section 35 of the said Act referred to
the decision as a whole, and was not to be equated to errors
of law or of fact simpliciter. This Court was of the view
that what the High Court could see is that there has been no
miscarriage of justice and that the decision was according
to law in the sense mentioned. Kapur, J. who delivered a
separate judgment, however, observed that the power under
section 35(1) of the said Act of interference by the High
Court is not restricted to a proper trial according to law
or error in regard to onus of proof or proper opportunity of
being heard. It is very much wider than that, when in the
opinion of the High Court the decision is erroneous on the
question of law which affects the merits of the case or
decision was manifestly unjust the High Court is entitled to
interfere. The revisional authority could ensure that there
was no miscarriage of justice and the principles of law have
been correctly borne in mind, the facts had been properly
comprehended in that light. If that was done in a particular
case then the fact that the revisional authority or the High
Court might have arrived to a different conclusion is irrel-
evant. This view had also been expressed in the decision of
this Court in Puranchand v. Motilal, [1963] Supp. 2 S.C.R.
906. This principle was reiterated in Krishnawati v. Hans
Raj, [1974] 2 S.C.R. 524 which was dealing with section
39(2) of the Delhi Rent Control Act, 1958 in second appeal.
It was observed that under section 39(2) of the said Act,
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the High Court could interfere in second appeal only if
there was a substantial question of law. In that case, the
question whether the appellant was legally married no find-
ing was necessary in the eviction suit. It was sufficient
for the rent court to proceed on the finding that the appel-
lant and S were living together as husband and wife, whether
they were legally married or not. It was further held that
whether there was subletting was not a mixed question of law
and fact. In Phiroze Bamanji Desai v. Chandrakant M. Patel &
Ors., [1974] 3 SCR 267 the question involved was whether
there was reasonable and bona fide requirement of premises
for personal use and occupation as also the question of
greater hardship under the Bombay Rent Act and the ambit and
scope of the power of Section 29(3) of the said Act with
which we are concerned came up for consideration. Bhagwati,
J. as the learned Chief Justice then was, referred with
approval the observations of Hidayatullah, J. referred to
hereinbefore in Hari Shankar’s case (supra). Bhagwati, J.
observed that the ambit of section 35(1) of the Delhi &
Ajmer Rent Control Act which fell for consideration in Hari
Shanker’s case (supra) was the same as section 29(3) of the
Bombay Rent Act and therefore, he expressed the opinion that
the
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High Court could interfere only if there was miscarriage of
justice due to mistake of law.
We must take note of a decision in the case of M/s
Kasturbhai Ramchand Panchal & Brothers and Others v. Firm of
Mohanlal Nathubhai and Others, AIR 1969 Gujarat 110, upon
which the High Court had placed great reliance in the judg-
ment under appeal. There the learned judge relying on sec-
tion 29(2) of the said Act held that the revisional power
with which the High Court was vested under section 29(2) was
not merely in the nature of jurisdictional control. It
extended to corrections of all errors which would make the
decision contrary to law. The legislature, the learned
Judge, felt, further empowered High Court in its revisional
jurisdiction to pass such order with respect thereto as it
thought fit. The power according to the learned Judge was of
the widest amplitude to pass such orders as the Court
thought fit in order to do complete justice. He dealt with
the human problem under section 13(2) of Bombay Rent Act
considering the relative hardships of the landlord and the
tenant and to arrive at a just solution he was of the opin-
ion that the court should have such wide field. The juris-
diction of High Court is to correct all errors of law going
to the root of the decision which would, in such cases,
include even perverse findings of facts, perverse in the
sense that no reasonable person, acting judicially and
properly instructed in the relevant law could arrive at such
a finding on the evidence on the record. In this view in our
opinion the ambit of the power was expressed in rather wide
amplitude. As we read the power, the High Court must ensure
that the principles of law have been correctly borne in
mind. Secondly, the facts have been properly appreciated and
a decision arrived at taking all material and relevant facts
in mind. It must be such a decision which no reasonable man
could have arrived at. Lastly, such a decision does not lead
to a miscarriage of justice. We must, however, guard our-
selves against permitting in the guise of revision substitu-
tion of one view where two views are possible and the Court
of Small Causes has taken a particular view. If a possible
view has been taken, the High Court would be exceeding its
jurisdiction to substitute its own view with that the courts
below because it considers it to be a better view. The fact
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that the High Court would have taken a different view is
wholly irrelevant. Judged by that standard, we are of the
opinion that the High Court in this case had exceeded its
jurisdiction.
In the case of Punamchandra Revashankar Joshi v. Ramjib-
hai Maganlal, Gujarat Law Reporter (1966) at page 807, the
Gujarat High Court after dealing with the Gujarat Amendment
Act (XVIII) of 1965
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observed that the Legislature has not intended to equate the
ambit of the power with the one exercised in an appeal. The
authority vested in the High Court under the amendment still
remained only in the domain of the jurisdiction and power of
revision and no further. The amending provision, therefore,
only related to procedure and not to any rights of the
parties.
This Court in the case of Bhai Chand Ratanshi v. Laxmis-
hanker Tribhavan, [1982] 1 Rent Control Journal 242 observed
that where lower courts applied their minds properly in
deciding a matter under section 13(2) of the Bombay Rent
Act, the High Court could not substitute its own finding for
the one reached by the courts below, on a reappraisal of
evidence under section 29(2) of the Act as substituted by
the Gujarat Act 18 of 1965. This Court reiterated that
although the High Court had wider power than that which
could be exercised under section 115 of C.P.C., yet its
revisional power could only be exercised for a limited
purpose with a view to satisfying itself that the decision
was according to law. The High Court could not substitute
its own finding for the one reached by the courts below on a
reappraisal of evidence.
In the instant case the basic question is whether keep-
ing in background the partnership deeds referred to herein-
before and the facts that came to light, was there partner-
ship or not. Sharing of profits and contributing to losses
were not the only elements in a partnership, existence of
agency was essential and whether there was a partnership or
not is a mixed question of law and fact, depending upon the
varying circumstances in different cases. This view was
reiterated by Chief Justice Beaumont, in Chimanram Motilal
and another v. Jayantilal Chhaganlal and another, A.I.R.
1939 Bombay 410. Ramaswami, J. in Mohammed Musa Sahib (dead)
and others v. N.K. Mohammed Ghouse Sahib and another, A.I.R.
1959 Madras 379 observed that whether the relation of part-
nership between two or more persons does or does not exit
must depend on the real intention and contract of the par-
ties and not merely on their expressed intention. He also
referred to section 4 of the Partnership Act about the
principles of partnership namely, (1) there must be agree-
ment entered into by all the persons concerned; (2) the
agreement must be to share the profits of a business; and
(3) the business must be carried on by all or any of the
persons concerned acting for all. In the instant case judged
by the aforesaid principles, it is possible to hold that
there was a partnership of which the appellant was a part-
ner. The Court of Small Causes considered these principles,
evaluated the evidence and held that there was in fact and
in law a partnership. Such a view was not an impossible one
or a perverse one.
305
If that was so, there was nothing that could be clone about
such a view, within the ambit and scope of the power of
section 29(2) of the Rent Act. We may mention that in Gunda-
lapalli Rangamannar Chetty v. Desu Rangiah and others,
A.I.R. 1954 Madras 182, Subba Rao, J. as the learned Chief
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Justice then was, held that there cannot be a subletting,
unless the lessee parted with legal possession. The mere
fact that another is allowed to use the premises while the
lessee retains the legal possession is not enough to create
a sub-lease.
In the light of the aforesaid principles and the facts
that have emerged, we are of the opinion that the High Court
exceeded its jurisdiction under section 29(2) of the Rent
Act. We are further of the opinion that the Court of Small
Causes was right in the view it took and it was a possible
view to take. In the result the appeal is allowed and the
judgment and order of the Gujarat High Court dated 21st of
August, 1979 are set aside. The order and judgment of the
Court of Small Causes Ahmedabad dated 18th of August, 1977
are restored. The suit for possession is accordingly dis-
missed. The appellant herein is entitled to the costs
throughout.
P.S.S. Appeal
allowed.
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