Summary
The Supreme Court restored an eviction order under the Karnataka Rent Act, 1999. The High Court had exceeded its revisional jurisdiction under Section 46 by reappreciating evidence. The landlord had proved that strangers to the lease were in exclusive possession after the original tenant-partner left, and the tenant's unproved 'reconstitution' of the partnership was a cloak for unlawful sub-letting.
Issues
- Whether the High Court was justified in interfering with the trial Court's findings of fact in revisional jurisdiction under Section 46 of the Karnataka Rent Act, 1999.
- Whether the burden of proving unlawful sub-letting lies on the landlord and whether it was discharged.
- Whether the alleged retirement of the original tenant-partner and continuation of the business by Respondent Nos. 2 and 3 was a mere reconstitution of the partnership or unlawful sub-letting/assignment.
Provisions considered
- Section 46, Karnataka Rent Act, 1999The revisional power to examine the legality or correctness of an order does not permit reappreciation of evidence or substitution of factual findings; findings can be disturbed only if perverse, based on no evidence or misreading of evidence, or causing miscarriage of justice. (¶¶ 12.1, 12.3, 12.6, 12.9)
- Section 27 (eviction grounds of sub-letting/assignment and occupation without lawful right), Karnataka Rent Act, 1999The arrangement under which strangers to the lease occupied the shop without the landlord's consent was held to be unlawful sub-letting/assignment and occupation without lawful right, making the respondents liable to eviction. (¶ 14.10)
- Section 26, Karnataka Rent Act, 1999Since the statute provides a separate appeal, the revisional jurisdiction cannot be expanded to substitute for the appellate remedy. (¶ 12.7)
Held
- Revisional jurisdiction under rent statutes, though wider than Section 115 CPC, is qualitatively distinct from appellate jurisdiction; the High Court cannot reassess evidence merely because another view is possible, and may interfere with findings of fact only for perversity, no evidence, misreading of evidence or miscarriage of justice. (¶¶ 12.1, 12.2, 12.3, 12.4)
- The trial Court's findings, including the discrepancies about the stamp paper, non-production of the original partnership deed, absence of proof of the original partner's retirement and lack of the landlord's written consent, were based on evidence and not perverse. The High Court's fresh analysis of depositions, partnership documents and rent receipts was impermissible reappreciation. (¶¶ 12.5, 12.6, 12.8, 12.9)
- The landlord bears the initial burden of proving sub-letting, which is discharged by showing exclusive possession of a third party and the original tenant's absence; a presumption of sub-letting then arises, the onus shifts to the tenant, and monetary consideration may be inferred from circumstances without direct proof. (¶¶ 13.1, 13.2, 13.3, 13.4, 13.5, 13.7)
- On the facts, Respondent Nos. 2 and 3, who were not parties to the lease, were in exclusive occupation while the original tenant was no longer in possession; the respondents produced no cogent evidence of a valid partnership, reconstitution, lawful induction or landlord's consent, so unlawful sub-letting stood proved. (¶¶ 13.6, 13.7, 13.8)
- Inducting or retiring partners is not sub-letting so long as the tenant retains legal possession and control, but the court may lift the veil where a partnership is a device to conceal a transfer; the determinative test is whether the original tenant retains legal possession and control. (¶¶ 14.1, 14.2, 14.3)
- The original tenant had divested himself of possession, the unregistered reconstitution deed was not proved, and Respondent Nos. 2 and 3 were in exclusive possession and control; rent receipts in the original tenant's name did not help, since legal possession and control, not rent formalities, decide the question. The so-called reconstitution was a cloak for unlawful transfer of possession. (¶¶ 14.4, 14.5, 14.6, 14.7, 14.8, 14.9, 14.10)
Result
Appeal allowed; High Court judgment dated 23.05.2023 in HRRP No. 56 of 2017 set aside; trial Court's eviction order dated 14.07.2017 in H.R.C. No. 63 of 2016 restored; respondents given three months to vacate and hand over vacant possession; no order as to costs.