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Judgment
A. Badharudeen, J
This execution second appeal has been filed under order XXI read with Section 100 of the Code of Civil Procedure, 1908 (“CPC” hereinafter) challenging verdict in A.S. No.32 of 2023 dated 28.11.2023 on the files of the Court of the Additional District Judge, Tirur arose from the order in E.A. No.2/2023 in E.P. No.92/2022 in RCP No.8/2020 dated 04.07.2023 on the files of the Court of the Munsiff-Magistrate, Ponnani. The appellants are the claim petitioners. The 1st respondent is the petitioner in the RCP and the landlord of the building. Respondents 2 and 3 are the respondents in the RCP who are the Directors of the Company according to the claim petitioners.
Heard the learned Senior Counsel appearing for the claim petitioners/appellants and the learned counsel appearing for the 1st respondent/the landlord, on admission.
The appellants will be referred as “claim petitioners”, the 1st respondent will be referred as “landlord” and respondents 2 and 3 will be referred as “tenants”.
Short facts; the landlord filed an RCP.No.8/2020 seeking eviction of respondents 2 and 3 from the plaint schedule building, contending that they are the tenants of the building. According to the landlord, the rent for the period from August 2017 to July 2019 was Rs.1,25,000/-per month. There was a covenant for an enhancement of the rent by 5% in August 2019. The respondents have not paid rent since March 2019. Moreover, the respondents have paid Rs.85,000/- short out of the rent for the month of March 2019. The respondents claim that they have deposited the rent for the period up to May 2019 in the bank account of the landlord, thereby the rent for the period from June 2019 to the date of filing of this application not paid and the same is "admitted arrears of rent".
Respondents in the RCP, who are respondents 2 and 3 herein filed objection and it was contended by the respondents 2 and 3 that they had deposited rent for the period up to May 2019, in the bank account of the landlord. The rent for the period up to the date of filing of the counter affidavit was paid directly to the landlord at his residence. Further, it was contended that the landlord refused to accept rent from January, 2021 onwards.
Thereafter, IA. No.2/2021 was filed in RCP No.8/2020 seeking eviction under Section 12 of the Kerala Buildings (Lease and Rent Control) Act, 1965 (hereinafter will be referred as ‘the Act’) on the ground of arrears of rent. In the said petition also the contentions raised by the landlord and the respondents 2 and 3 are as herein above extracted.
The Rent Control Court, Ponnani, on appreciation of the evidence, allowed I.A. No.2/2021 as per the order dated 01.10.2021 and the same is as under:
“The petitioner says that there is a covenant for yearly enhancement of the rent by 5% from August 2019 onwards. The respondents have stated in their counter affidavit that the lease agreement is valid up to 30-08-2027. However, none of the parties have produce the lease deed before the court. Therefore, the court is unable to ascertain what the terms of the lease are. It is not clear if the lease deed is registered or not. The fact that the petitioner has sought an order under section 11(3) of the Act suggests that his case is that the tenants are holding over. The tenants have not admitted that there is a covenant for yearly enhancement of the rent from August 2019 onwards. The landlord has not produced any document to show that there is a covenant for yearly enhancement of the rent. In these circumstances, the petitioner's prayer for enhanced rent from August 2019 onwards cannot be granted. The petitioner has filed a calculation statement. In it, he has claimed rent at the rate of ₹1,31,250/- per month from the date of filing of the application for eviction. In the light of the discussion made above, the rent that has accrued since the date of the filing of the application for eviction shall be calculated at the rate of ₹1,25,000/- per month. The petitioner is also entitled to recover 6% interest per annum on the rent that has accrued after the filing of the application. In the result, the following orders are passed:
The respondents are ordered to pay the rent that has accrued after the filing of R.C.P. 8/2020 with 6% interest per annum on or before 01-11-2021.
The rent that has accrued after the filing of the rent control petition shall be calculated at the rate of ₹1,25,000/- per month, and interest shall be calculated on each month's arrears from the date on which it fell due to the date of payment.”
Challenging the order in IA No.2/2021 dated 01.10.2021, respondents 2 and 3 filed RCA No.30/2021 before the Rent Control Appellate Authority/Additional District Judge, Tirur. The Appellate Court also confirmed the finding of the Rent Control Court.
Thereafter, RC Rev. No.227/2022 was filed by the 2nd respondent in the RCP before this Court, mainly raising contention that the rent agreed was only Rs.50,000/- per month. While appreciating the said contention in paragraph No.4 of the judgment dated 05.01.2023, the Division Bench of this Court found as under:
It is to be noted that there is no much controversy as to the rate of rent payable by the tenant. We perused the counter affidavit as well as the notice preceded the execution petition. In all these materials, there was no denial regarding the rate of rent payable by the tenant. No rent was paid in accordance with the calculation made by the Rent Controller. In revision petition, we cannot extend the time for payment of admitted arrears of rent. It is pointed out that as of now, more than Rs.45 Lakhs is due towards the arrears of rent. We, therefore, find no reason to interfere with the impugned order. Accordingly, revision dismissed.
It is noticed that the claim petitioners herein represented by their power of attorney holder, had filed OP(RC) No.108/2023 before this Court, after filing EA.No.2/2023 in EP.No.92/2022 in RCP No.8/2020. While dismissing the above original petition, the Division Bench of this Court held as under:
“At the outset, nothing is produced before us to show that the company has authorised the filing of the above original petition, which is apparently done through one Rajesh Pius, claiming to be the power of attorney holder and by another person projecting himself as a Director of the 1st respondent company. There is also nothing on record to suggest that the lease was in favour of the 1st petitioner company, as there are no documents produced to substantiate the same. In the absence of the above details, we do not deem it fit to entertain this original petition. Accordingly, this original petition stands dismissed.”
Coming to the facts of EA No.2/2023, the contention raised by the claim petitioners before the Rent Control Court is that the petition scheduled building in RCP No.8/2020, in fact, was taken on rent by Aadhiriyaa Medical Solutions Private Limited and the respondents in the RCP are the Directors of the said company. Further contention raised was that since the 2nd claim petitioner, who is one among the Directors of the Company and the 1st respondent in RCP No.8/2020 and another Director of the Company were not in station, the 2nd respondent was authorized to run the business. But it was noticed by the claim petitioners that, the 2nd respondent colluded with the landlord and the same resulted in passing orders against the tenants by the Rent Control Court, Appellate Court as well as this Court, on earlier occasions and the same are not binding on the claim petitioners. Therefore, the claim petitioners’ contention required to be addressed under Order XXI Rule 97 of CPC independently to retain the building as tenants. According to the claim petitioners, the company took the building on rent for a period of ten years for a monthly rent of Rs.50,000/- per month.
The contention raised by the 1st respondent/ landlord is in tune with the contentions raised in the RCP and in the RCP it was contended by the landlord that the claim petitioners have no locus standi to file this appeal and therefore the appeal is not maintainable. The claim petition is one filed in collusion with respondents 2 and 3, with intent to avoid eviction of the plaint schedule building after suffering adverse orders under Section 12 of the Act.
In RCP No.8/2020, the landlord raised contention that the petition scheduled building having plinth area of 16,000 square feet was given to Sri.Basheer and Sri.Biju Nair (respondents in RCP No.8/2020), for the purpose of running medical centre, laboratory and medical education institute from August 2017 to July 2019 for a monthly rent of Rs.1,25,000/- and it was agreed to increase the rent at the rate of 5%. According to the landlord, Rs.85,000/-outstanding towards the rent for the month of March, 2019 and the rent thereafter also is in arrears. Accordingly, he pressed for order under Section 12 of the Act and the orders herein above referred were passed accordingly.
The learned senior counsel appearing for the claim petitioners argued at length to convince this Court that the 1st claim petitioner/Company is the tenant, even though there is no rent agreement in this regard produced from the side of the claim petitioners or from the landlord. It is argued that, Exts.X1 to X5 statements of accounts read along with the evidence of PWs 2 to 5 would establish that the rent was paid to one Aysha, who is none other than wife of the landlord and in one occasion to one Haridasan. Therefore, the claim petitioners are the real tenants of the building and the proceeding in RCP No.8/2020, without the junction of the claim petitioners is not binding on them. He also given emphasis to Ext.A17, the registration certificate issued by the District Medical Officer, Malappuram in favour of the company as on 05.09.2018 produced before the First Appellate Court in A.S.No.32/2023 to address the point that the claim petitioners are the tenants and though the respondents in RCP No.8/2020 are Directors of the company, they are not the tenants of the building.
As pointed out by the learned Senior Counsel, in paragraph No.16 of the appellate judgment, the 1st claim petitioner/company though raised a contention that the claim petitioners are the tenants of the building, it was observed by the First Appellate Court that nobody produced the lease agreement to see the terms of the agreement. The First Appellate Court, in the absence of lease agreement, evaluated evidence available as that of PWs 2 to 5 and Ext.X1 to X5 statements of accounts as rightly done by the trial court. The Appellate Court found that, the evidence of PW2, the Manager of Indian Bank, Edappal Branch along with Ext.X1 statement of account would show payments by way of cheques to Aysha from the account of the claim petitioner/company at the rate of Rs.1,25,000/- each on 29.12.2017, 16.02.2018, 17.03.2018, 19.04.2018, 18.05.2018, 19.06.2018, 17.07.2018, 31.08.2018 and 19.09.2018 could be noticed. Similarly, the First Appellate Court observed that Ext.A2 is the account statement of the 1st claim petitioner/company maintained with Union Bank, Edappal branch. PW3 is the Manager of that bank. Ext.X2 shows the following payments to Aysha by way of cheques viz. Rs.15,000/- on 07.03.2019, Rs.1,25,000/- on the same day, Rs.60,000/-and Rs.65,000/- on 14.03.2019 and Rs.15,000/- and Rs.1,25,000/- on 18.03.2019. Ext.X3 is the account statement of the 1st claim petitioner/company maintained with ICICI bank, Edappal. PW4 is the Manager of that bank. As per the above account statement Rs.15,000/- each is seen paid to Aysha on 16.11.2018 and 27.11.2018. Ext.X4 is the account statement of the 1st claim petitioner/ company maintained with Indian Overseas bank, Edappal branch. PW5 is the manager of that bank. As per Ext.X1, Rs.1,25,000/- is seen paid to Aysha on 26.10.2017 and Rs.1,25,000/- to one Haridasan on 21.11.2017 and another ₹1,25,000/- to Aysha on 18.01.2017.
It is observed by the First Appellate Court further that most of the payments of rent as contended by the claim petitioners is in the name of Aysha, who is said to be the wife of the landlord and one payment is in the name of Haridasan. Accordingly, the first Appellate Court, while addressing the evidence given by PW1, who is the power of attorney holder of the 1st claim petitioner, found that PW1 had no direct knowledge regarding the transactions and his evidence is nothing but hearsay. It was also found by the First Appellate Court that no authorization was also given by the landlord to deposit the rent in the names of Aysha and Haridasan. Accordingly, while confirming the finding of the trial court, to the effect that the claim petitioners are not the tenants of the building, for want of evidence, the Appellate Court held that the claim petitioners failed to establish that the claim petitioners are the tenants of the building. Accordingly, the Appellate Court dismissed the claim petition.
The learned senior counsel for the claim petitioners vehemently submitted that the monthly rent agreed is only Rs.50,000/-, but as pointed out by the learned counsel for the landlord, the deposits made as per the evidence of PWs 2 to 4 and Exts.X1 to X4, the monthly rent is Rs.1,25,000/-. It is true that the claim petitioners attempted to justify the amount by adjusting Rs.50,000/-towards the rent and payment of Rs.75,000/- in addition to Rs.50,000/- as the amount agreed to be paid as advance by twenty equal installments of Rs.75,000/- totaling Rs.15,00,000/-.
On evaluation of the materials available, it is emphatically clear that, if the claim petitioners want to succeed after contesting the case at the instance of the respondents 2 and 3 herein, who admittedly took the building for rent in the proceedings in RCP No.8/2020, there should be cogent and convincing evidence to hold that the claim petitioners are the tenants of the building. Apart from the bank statements showing payment of rent in the names of Aysha and Haridasan, no materials available to hold that there is rental agreement in between the claim petitioners and the landlord, in any manner. The crucial witnesses to be examined in this regard are Aysha and Haridasan, but they were spared without being examined and the claim petitioners relied on the hearsay evidence of the power of attorney holder, who was examined as PW1 to establish the tenancy in between the claim petitioners and the landlord. Even no materials available to see that Aysha is the wife of the landlord.
To sum up, the claim raised by the claim petitioners was rightly found against by the Execution Court and the Appellate Court. Further, the Division Bench of this Court also negatived the said contention as already extracted. In view of the above discussion, no substantial question of law emerges in this matter to be formulated to maintain and admit this execution second appeal. Order XLII Rule 2 of CPC provides thus:
“2. Power of Court to direct that the appeal be heard on the question formulated by it.-At the time of making an order under rule 11 of Order XLI for the hearing of a second appeal, the Court shall formulate the substantial question of law as required by section 100, and in doing so, the Court may direct that the second appeal be heard on the question so formulated and it shall not be open to the appellant to urge any other ground in the appeal without the leave of the Court, given in accordance with the provision of section 100.”
Section 100 of CPC provides that, (1) Save as otherwise expressly provided in the body of this Code or by any other law for the time being in force, an appeal shall lie to the High Court from every decree passed in appeal by any Court subordinate to the High Court, if the High Court is satisfied that the case involves a substantial question of law. (2) An Appeal may lie under this section from an appellate decree passed ex parte. (3) In an appeal under this section, the memorandum of appeal shall precisely state the substantial question of law involved in the appeal. (4) Where the High Court is satisfied that a substantial question of law is involved in any case, it shall formulate that question. (5) The appeal shall be heard on the question so formulated and the respondent shall, at the hearing of the appeal, be allowed to argue that the case does not involve such question. Proviso stipulates that nothing in this sub-section shall be deemed to take away or abridge the power of the Court to hear, for reasons to be recorded, the appeal on any other substantial question of law, not formulated by it, if it is satisfied that the case involves such question.
In the decision reported in [2020 KHC 6507 : AIR 2020 SC 4321 : 2020 (10) SCALE 168] Nazir Mohamed v. J. Kamala and Others, the Apex Court held that:
The condition precedent for entertaining and deciding a second appeal being the existence of a substantial question of law, whenever a question is framed by the High Court, the High Court will have to show that the question is one of law and not just a question of facts, it also has to show that the question is a substantial question of law. In Kondiba Dagadu Kadam v. Savitribai Sopan Gujar, [(1999) 3 SCC 722].
In a latest decision of the Apex Court in Government of Kerala v. Joseph, reported in [2023 (5) KHC 264 : 2023 (5) KLT 74 SC], it was held, after referring Santosh Hazari v. Purushottam Tiwari, [2001(3) SCC 179] (three – Judge Bench), as under:
For an appeal to be maintainable under Section 100, Code of Civil Procedure ('CPC', for brevity) it must fulfill certain well – established requirements. The primary and most important of them all is that the appeal should pose a substantial question of law. The sort of question that qualifies this criterion has been time and again reiterated by this Court.
The legal position is no more res-integra on the point that in order to admit and maintain a second appeal under Section 100 of CPC, the Court shall formulate substantial question/s of law, and the said procedure is mandatory. Although the phrase 'substantial question of law' is not defined in the Code, 'substantial question of law' means; of having substance, essential, real, of sound worth, important or considerable. It is to be understood as something in contradistinction with – technical, of no substance or consequence, or academic merely. However, it is clear that the legislature has chosen not to qualify the scope of “substantial question of law” by suffixing the words “of general importance” as has been done in many other provisions such as S.109 of the Code or Art.133(1)(a) of the Constitution. The substantial question of law on which a second appeal shall be heard need not necessarily be a substantial question of law of general importance. As such, second appeal cannot be decided on equitable grounds and the conditions mentioned in Section 100 read with Order XLII Rule 2 of CPC must be complied to admit and maintain a second appeal.
In this matter, no substantial question of law arises for consideration so as to admit this second appeal. It is the well settled law that a second appeal involving no substantial question of law cannot be admitted. Therefore, the decree and judgment under challenge do not require any interference and no substantial question of law to be formulated to adjudicate in this execution second appeal.
Accordingly, this execution second appeal stands dismissed, without being admitted, as indicated above. All interlocutory applications pending in this execution second appeal stand dismissed.
Faced, with the negative verdict, the learned senior counsel for the claim petitioners sought four months time to vacate the building. Since, no tenancy or occupation found by this Court repeatedly at the instance of the claim petitioners, such a prayer cannot be considered. Hence, the said prayer also rejected, with direction to the Execution Court to expedite eviction of the tenants from the building, within two weeks from the date of receipt of copy of this judgment, without fail, since the arrears of rent is more than Rs.60 Lakh as submitted by the learned counsel for the 1st respondent/the landlord.