subletting

11 (4) i if the tenant after the commencement of this Act, without the consent of the landlord, transfers his right under the lease or sub-lets the entire building or any portion thereof if the lease does not confer on him any right to do so:

Explanation: – where on the partition of a joint family or of the rights of co-tenants or on the dissolution of a firm, the right of the joint family or the co-tenants or the firm under a lease is vested in a member of the joint family, or a co-tenant or a partner, as the case may be, whether by act of parties or otherwise, no transfer by the tenant of his right under the lease shall be deemed to have taken place within the meaning of this clause; or

Provided that an application under this clause shall not be made for the first time in respect of one and the same tenancy unless the landlord has sent a registered notice to the tenant intimating the contravention of the said condition of the lease and the tenant has failed to terminate the transfer or the sublease as the case may be, within thirty days of the receipt of the notice or the refusal thereof.

1. Object

Though section 4 (2) of the Act 2 of 1965 provides for an implied termination of tenancy in case of subletting, that provision provides only for giving notice of vacancy before the accommodation controller. But the subsection 4 (i) of section 11 provides the ground for eviction. Section 11 (2) and section 11 (4) i has some resemblance in the prerequisites, the registered notice is mandatory for both these grounds. According to the provision of the T.P. Act the sub lease should be specifically barred at the time of leasing. But Act 2 of 1965 provides a bar to the tenant not to sublease unless the landlord grants consent. Kerala Buildings (Lease and Rent Control) Act is a self contained legislation and it is wholly unnecessary to go outside the statute and determine whether the tenant is liable to be evicted or not under the Transfer of Property Act.

2. Scope
Subletting the whole or part of the building or assignment of tenancy right without express permission of the landlord is a ground for eviction. Once the landlord proves subletting or parting with possession or assignment to the satisfaction of the court, the landlord is as of right entitled to get an order of eviction, he need not have to establish further that his claim for eviction is bonafide. The rent control act is a complete code in itself Transfer of Property Act section 108 (j) is no defense to an action for eviction on the ground of subletting. Act contemplates eviction in situations where the tenant unauthorisedly transfers his right under the lease without the landlord’s consent even when the transfer does not amount to subletting.

3. Sub letting.
The Rent Act does not prohibit tenant to permit use of the premises so long as tenant remains in possession of the rented premises. Such permission to others to use premises does not amount to sub-letting. A room in a Hotel or boarding house has been taken out of the definition of Building. Therefore, a room in a Hotel given in possession to the lodger does not amount to sub-letting.
Even if the lease deed confers power on the lessee to sublet, a Rent Control petition could be maintained against the lessee and sub-lessee on any of the grounds other than S. 11 (4) i . Even if the lease confers tenant right to sublet, that right is available only during the contractual tenancy, ie. within the lease period. Thereafter when the statuary tenancy beings the tenant will not get the benefit of the contract, During the statutory tenancy period the tenant has got the rights conferred by the statute and not the contract.
No period of Limitation is prescribed for filing Rent Control Petition on the ground of sub-letting. Subletting do not create any new right on the Tenant against landlord on the other hand he loses his protection of The Kerala Buildings (Lease and Rent Control) Act 1965. In the event of losing such protection he should definitely suffer the consequences as provided in S. 11 (4) i.
The right to seek an order of eviction is available to the landlord Under section 11 (4) i from the date of commencement of Rent control petition, and not from the date on which the Act was made applicable to the area.

The Subletting taken place before the Rent Control Act take into effect. Subletting must necessarily be after Kerala buildings (Lease and Rent Control) Act 1965. The petition is not sustainable as per the clear wordings of S.11 (4) i.
Even if the subletting is only a portion of the building the landlord gets the right to evict the tenant from the whole building let to him. Exclusive possession of, at least of a portion of the building has been transferred by the tenant to the alleged sub tenant and that the tenant has miserably failed in establishing that the jural relationship between him and the alleged sub tenant is that of employer and employee, will result in an order of eviction from the whole building. Unless tenant adduces cogent evidence that the jural relationship between the tenant and the alleged sub-leasee is that of employer and employee, the ground of sublease under section 11 (4) i will be made out. Creation of single tenancy for two rooms of which one was sublet can result in eviction whole tenancy.

As the finding of the sub-letting is a finding of fact, the High Court is bound by the same.

4. Legal Heirs and subletting
A fresh tenancy was created on the death of the tenant in favour of one son with consent of other heirs. If another son is occupying the premises it amounts to subletting.

5. Partnership and subletting
A tenancy right derived out of partition of a partnership will not constitute subletting. The explanation to the section clearly excludes such tenancies from the mischief of subletting. Existence of partnership between tenant and subtenant is a good defense, the burden of proof is on the tenant. The tenant should prove the sharing of profit of the business, mere production of partnership deed is not enough.
Sublessee contended partnership with original tenant and produced registered partnership deed and sales tax registration. Original tenant remained ex parte to proceedings. No pleading or any evidence to show that there was any sharing of profits. So partnership deed found to be a camouflage created to circumvent the provisions contained in S.11(4)(i).
Partnership deed is relied on to contend that the jural relationship between the tenant and the alleged sub lessee is that of partners. Very nominal percentage of the capital which is contributed by the tenant and tenant’s share in the profits is also very nominal. The alleged sub lessee is the Managing Partner. The tenant is not given any part in the management of the affairs of the firm’s business which is to be conducted in the schedule building. The tenant was if at all only a dormant / sleeping partner. The physical possession of the building as well as the right to conduct of business therein was with The Managing Partner and that despite the partnership deed the tenant was not actually taking part in the business at all and that the very execution of partnership deed was to cover up the real arrangement between the parties. The finding is that the tenant does not carry on business at all and that the partnership itself is a camouflage of covering up the sublease.

On dissolution of the partnership firm all the rights of the tenant firm including tenancy rights had been transferred to one of the partners who continued in occupation. This does not amount to sub letting of the premises. Transfer of the tenancy in favour of a partnership firm of which the tenant is a partner does not amount to subletting. If on the reconstruction of partnership none of the original tenant or their legal heirs remains as a partner, the remaining partners would assume the status of a sub-lessee. The receipt of rent cannot be put against the landlord.
Unauthorised transfer of right of the tenant includes subletting. Where the rented premises let out to a tenant is placed in exclusive possession of another person with an attempt to camouflage the subletting, by an agreement of an ‘agency’. It was held that exclusive possession with full control clearly amount to sub-letting and the agreement of agency cannot hide the real transaction. Tenant entering into an agreement with a third party, allowing him to take possession of the entire premises, giving full power of control and management over the leased property. It is only a camouflage to suppress the fact of sub-letting the property.
Recital in the rent deed indicated that lease was in favour of a firm. Rent was paid on behalf of the firm. The Partner who had signed the rent deed retired and firm continued by other partners. There was no subletting.
The fact that Local authorities license for trade is in the name of original tenant cannot rule out the possibility of another person in possession. Similarly failure to supply the name of the sub lessee and failure to impugn partnership deed as a sham document by amending the pleadings also cannot be fatal to the landlord.
It is well settled that if the tenant forms a partnership and carries on his business, there is no exclusive transfer of possession. But if the partnership is sham and real purpose is subletting, the disguised partnership deed is not to be looked into. In such case there is no genuine partnership despite legal devices to camouflage the subletting. When tenant parts with exclusive possession of business premises to stranger other than close blood relation, in the absence of contrary evidence passing of consideration can be presumed. The payment of consideration is personal to the tenant and the sub-tenant ant it is not possible to prove it by direct evidence and, thus, an inference can be drawn that the passing of possession to the sub-tenant by the tenant is for consideration. The landlord does not have to prove that the transfer is for valuable consideration, there is a presumption of consideration under section 114(f) of the Indian Evidence Act against the tenant. When the transfer is made to a close relative, consideration need not be proved at all and in such case only the transfer of exclusive possession needs only be proved.
The law of partnership applied only to the partnership and not to the landlord-tenant relationship. The tenant cannot violate any of the provisions of the Rent Control Act on the basis of the partnership agreement with the third parties. So far as the right of the landlord seeking eviction is concerned, the main question will be whether there are any grounds under the Rent Control Act entitling the landlord to get eviction.
Tenant formed partnership – tenant died – business by other partner amount to sub-lease. The evidence does not disclose that the landlord had accepted the partnership arrangement. The entire affairs of the firm and the management were looked after by the tenant during his life time. There was no transfer of possession of the tenancy in favour of another while the tenant himself was a partner. When the tenant ceases to exist, the tenancy right was taken over by the respondent, which is a transfer from the original tenant as far as the landlord is concerned. This change of possession falls within the mischief of the provisions of the Act. Existence of partnership between the tenant and the subtenant is a valid defense to the plea of subletting. Creation of partnership is not subletting but when the original tenant dies the other parties cannot continue in the building because the partnership is not the tenant. where the original tenant parted away with legal possession by inducting a firm of which the original tenant is not even a partner and such parting away with the possession was without the knowledge and consent and much less the written permission from the landlords.
The sub tenant claims that he is in possession of the building on the basis of a partnership. Effect of an unregistered partnership and matters to be considered by the court is discussed. The Rent Control Courts should be slow to place reliance on partnership which are not registered in accordance with provisions of the Partnership Act even when they are setup in defense.
Persons who were original tenants of the landlord and who were in possession of the premises have entered into a transaction evidenced by Ext. B1, with petitioners 2 to 8 and a new partnership has come into existence. The property, which was in possession of the original tenants, thus continues in possession of all the partners of the new partnership firm, which includes the original tenants as well. Such a transaction does not bring about sub-lease to enable the landlord to seek eviction invoking S.11 (4) (i).
If the original tenant converts the business into a limited company or into a partnership retaining control, it does not amount to subletting or transfer. However, if he retires or severs his connection with the partnership the same amounts to subletting.
Building let out to a Co-operative society. The society merged with another society and transferred all assets including the building to the latter society tantamount to sublease.
The landlady was not aware of the partnership formed by the original tenant. Even after the death of the original tenant she had no reason to suspect that the revision petitioners who are some of the sons of the original tenant were paying the rent in their capacity as partners of a firm. She came to know of the partnership only on receipt of Ext. A-2 reply notice. If may also be noticed that Ext. A-2, the stand taken by the revision petitioners was that there was subsequent lease in favour of the firm. The revision petitioners failed to prove that allegation. Therefore, the contention that the landlady accepted the revision petitioners as her tenant, is without any merit.
If the purpose of such partnership may ostensibly be to carry on the business in partnership but the real purpose was subletting of the premises to such a person who is ostensibly a partner then the same would be deemed to be an act of subletting coming within the mischief of S.11(4)(1).

6. Pre-requisites for eviction under section 11 (4) i.
The pre-requisites for eviction under subletting are 1) there must be subletting without the consent of the landlord. 2) Registered Notice to the tenant if the suit for subletting is for the first time in respect of one and the same tenancy and the sub tenancy was not removed within 30 days. In the case of repeated act of subletting the notice need not be repeated for every occurrence.
To prove subletting two ingredients are necessary to be proved, (i) exclusive possession of the sub-tenant (ii) valuable consideration by the sub-tenant to the head tenant. The ingredients of unauthorized subletting and transfer of tenant’s rights under the lease necessary under section 11 (4) i are in the alternative and not cumulative. The landlord needs only to prove any one of them. The landlord need not prove positively that the transfer is for valuable consideration. Considering the fact that payment of rent by a sub-tenant to the tenant is always a secret arrangement between them, proving the fact by documentary evidence should not be insisted.
Even if there is no express prohibition in lease deed regarding subletting, the landlord can seek eviction on the ground of subletting.

The landlord needs only to show that the sub-lessee is in possession on the date of petition. If the tenant fails to terminate the sublease within the statutory period, the ground of subletting arises. The fact that there was delay in filing the Rent Control petition is of no consequence. Expression ‘to terminate the transfer or the sub lease’ used in the proviso to S.11(4)(i) means full and effectual termination of sub-lease or transfer in the sense that the alleged sub lessee or transferee is sent away from the building.

Subletting for more than one year through a non registered instrument is a valid ground for eviction but the alleged subletting should continue till the petition date.
For getting eviction on the ground of sub-letting the landlord has to prove that in between the tenant and the sub-Tenant there is a relationship of lessee and lessor and the possession of the premise was parted with exclusively by the tenant in favour of the sub tenant. The landlord is expected only to establish the presence of sub-lessee in the premises with whom landlord has no jural relationship. Burden is entirely on the tenant to establish the jural relationship between him and the sub-lessee. And when a person other than the tenant is found to be in the building, the burden is on the tenant to show there is no sub-lease or transfer of possession. In order to prove a sub-lease there must be transfer of an exclusive right to enjoy the property and there must be parting of legal possession. Transfer of exclusive possession is prima facie evidence of tenancy although circumstances may be established which negative the intention to create a lease. Once the landlord has established that a person other than the tenant is in occupation of the premises burden shifts to the tenant to prove the relationship of tenant and the person occupying the building and rebut the presumption of sub lease. A person who is inducted as a sub-tenant without the consent of the landlord need not be made a party in ejectment suit filed against the tenant, but, if the alleged sub-lessee claims some independent right, those can be agitated in separate proceedings. Or he can challenge the decree as fraudulently passed and obtained in fraud of his rights.
A legatee under a testamentary disposition cannot claim the status of a statutory tenant and resist the claim of eviction for subletting unless the legatees are natural heirs.

7. Partial subletting
Partial subletting is a ground for eviction. Even if the original tenant retains some portions with him and under his exclusive possession the tenant and the subtenant can be evicted from the whole building.

8. Notice
“Provided that an application under this clause shall not be made for the first time in respect of one and the same tenancy unless the landlord has sent a registered notice to the tenant intimating the contravention of the said condition of the lease and the tenant has failed to terminate the transfer or the sublease as the case may be, within thirty days of the receipt of the notice or the refusal thereof.”

A registered notice is made mandatory to constitute the ground of subletting. This notice is required only for the first instance of sublease. This mandatory condition is incorporated in the form of a proviso. Hence without the notice ground of subletting does not arise. The landlord must send a registered notice to the tenant stating the contravention of the condition of the lease and must give 30 days’ time to the tenant to terminate the transfer or sub-lease; if within 30 days the sub lease is not terminated the landlord can file an application before the Rent Control Court to evict the tenant.

Even though the Statute refers to actual service or refusal only, if there is evidence to hold that a subletting tenant has deliberately evaded receiving the statutory notice, then also the same will amount to refusal of the notice, satisfying the requirements of the proviso.

Appellate Court found that the sublease was after service of notice. Even then eviction is possible. If the sub tenancy has been terminated within 30 days period after the receipt of the registered notice from the landlord intimating about the objectionable sub-lease, the landlord cannot initiate any proceeding for the eviction of the tenant.

Mere plea that the registered notice as contemplated under the proviso to S. 11 (4) i has not been issued, that itself is not a ground to non-suit the landlord. Especially when all the ingredients provided in the proviso has been satisfied.
Landlord send a registered notice to the tenant intimating the contravention of the condition of lease but the notice returned with the endorsement “Addressee out of India” landlord also send a copy to the sub lessee who received it. Landlord’s responsibility cannot be equated with the responsibility of serving notice under Order V of CPC. Petition under S. 11(4) i cannot be rejected on the ground that the tenant has not received the notice. Notice sent prior to subletting is sufficient. Omission of sub-lessee’s name in the notice would not render the notice defective or invalid. Failure of advocate to sign notice intimating subletting will not render the application for eviction non maintainable. The tenant is not prejudiced by such neglect.
Notice issued to one of the joint tenants is sufficient to maintain an application under S.11 (2) b (arrears) and also under S. 11 (4) i (subletting). Heirs are joint tenants. Notice to one of the joint tenant is sufficient and the petition maintainable.
The sublease or unauthorised transfer subsisted at the time of trial. The tenant having not terminated the sublease or unauthorised transfer within the period of thirty days of receiving the notice cannot avoid the inevitable order of eviction by offering to terminate or by actually terminating the sublease or unauthorised transfer thereafter.
The fact that the suits were instituted by the tenant for ejecting the sub lessee, whether it be on the strength of a mandatory injunction decree or a decree for recovery of possession, will show that the alleged sub lessee was having possession and absolute physical control of the schedule premises.

9. Partition of joint family and dissolution of firm

There is an explanation for this clause. The explanation provides protection to the tenant who’s right is derived from the partition of a joint family or on dissolution of a firm provided he was a member of the joint family or partner in the partnership. Then no transfer by the tenant of his right shall be deemed to have taken place within the meaning of this section.

10. Consent
Acceptance of rent from sub-tenant does not estop the landlord from claiming eviction on the ground of sub-letting. Acceptance of rent by the landlord from the sub lessee is not a ground to hold that the landlord has recognized the sub lessee as the tenant. Issuance of rent receipt by the landlord would not defeat the right of the landlord in seeking eviction under the Rent control Act. There is no question of waiver of estoppel or acquiescence. Mere knowledge or inaction or even the receipt of rent by the landlord even after somebody else is let into the building, will not deprive the landlord of his right to evict the tenant under S.11(4)(i). Contention that original tenant had surrendered the lease and later the landlord had created oral lease in favour of revision petitioner, in the absence of evidence to prove scuh facts, the plea is untenable.

Neither a new tenancy or a valid sub tenancy in favour of the subteannt has been created on Acceptance of rent from the subtenant. Landlord is not estopped from seeking eviction on ground of unauthorised sub letting on the ground that he had accepted rent from the subtenant. Consent contemplated by S.11(4) i of the Act is a consent to the subletting before the subletting and mere knowledge, inaction or receipt of rent by the landlord even after somebody else is let into the building would not lead to the loss of the right of the landlord. Inaction on the part of the landlord would not be sufficient to amount to implied consent to sub-let. Inaction in every case does not necessarily lead to an inference of implied consent or acquiescence. The inaction of the landlord will not amount to acquiescence, there is no implied consent even if the landlord know about the subletting.
Prior consent to the subletting is a must Mere inaction for some time by the Land Lord would not disable landlord from seeking eviction. If the landlord has given consent to a particular subletting it will not entitle the tenant to sublet the premises on subsequent occasions without the consent of the landlord.

The consent of the landlord is to be with some positive action so that the tenant can be said to have had the authority to sub-lease his lease rights. A consent letter issued by the landlord after the lease, does not entitle the tenant to sublet the building. Consent contemplated under S.11(4)(i) of the Act is a consent to subletting before the subletting. Mere knowledge or inaction or even the receipt of rent by the landlord even after somebody else is let into the building, will not deprive the landlord of his right to evict the tenant under S.11(4)(i).
Continuance of the landlord as a partner in the sub lessee firm amounts to a positive act of consent to sublease the premises.
Silence of the landlord cannot be considered as consent for subletting within the meaning of S.11(4) i There is also evidence to show that the original tenant was tyrannical & the landlords were afraid of him. In that situation were silence or failure to raise prompt objection to the subletting cannot lead to the conclusion that the landlords have waived their right.
The contractual tenancy provided for subletting. But subletting after the termination of the contractual tenancy and after commencement of the Rent Act without the written consent of the landlord will be a ground for eviction. The consent given by the landlord originally will not be available after the expiry of the period of contractual tenancy.
Assigner landlord issued a notice calling upon the tenant to abate the sub tenancy but it was not followed by a petition. The objectionable subletting does not become an authorised subletting by this process. The right to apply for eviction will continue so long as the subletting continues. And Art. 137 of the Limitation Act 1963 is not applicable to rent control proceedings before the rent controller.
It is clearly provided under the proviso that if the application for eviction under S.11(4)(i) is to be filed for a second time by a landlord against his tenant, the statutory intimation notice under the proviso to S.11(4)(i) is not necessary. The landlord can file petition under this section anytime after the notice. Even after a long period no further notice is necessary.

11. Exclusive possession

When it is shown that a person other than the original tenant is in exclusive possession, the burden is on the tenant to disprove the prima facie case of subletting established by the landlord. Burden of proof is not on the Landlord to prove that the lessee has parted with legal possession. The difference between sublease and assignment is analysed in this case. Inference of sub-letting cannot be assumed by the mere fact that someone other than the tenant is in possession of the building.
When the possession of the building is with a third person, it is the tenant to establish that the nature of subletting is only a licence to possess. If the enquiry reveals that the arrangement though styled as licence is one intended as a camouflage for an arrangement of sublease or transfer of possession then order of eviction will follow. When it is seen that somebody other than the tenant is in possession of that portion, it is for the tenant to explain and establish by cogent evidence as to what is the jural relationship between him and the person in possession of that portion.

There must be a transfer of the legal possession and exclusive right to enjoy the premises, and some amount has been collected by way of rent or compensation.
License or lease the classic test is the test of exclusive possession. If the alleged transfer to subtenant is only license eviction will not be ordered. But if the enquiry reveals that the arrangement though styled as license is one intended as a camouflage for an arrangement of sublease or transfer of possession order of eviction will follow.
The burden of proof cast on the landlord is only a prima facie one. The burden shifts to the tenant to prove the nature of relationship with the alleged sub-tenant when the building is in exclusive possession of another. The landlord needs only to prove the transfer of exclusive possession of the premise for valuable consideration. The burden of proof thereafter is on the tenant to rebut that evidence. The prima face proof of sub lease or transfer can be in the form of oral evidence of the landlord himself or by persons who are aware of those facts. The court has to assess that evidence along with any document which the landlord is able to produce. If the landlord proves that the subtenant is in exclusive possession of the tenanted premises then the onus is shifted to the tenant to prove that it was not a case of subletting.
Parting of possession of rented property by tenant to a third party and receiving monitory consideration could establish subletting. The burden of proof is on the landlord and the same will shift to the tenant if the landlord establishes that the tenant has parted the possession. Relationship between the tenant and subtenant is not material for deciding the question of sub-tenancy. The landlord need to prove positively by adducing evidence that transfer of possession was for valuable consideration. Only when it is impossible to draw a presumption under S.114(f) of Evidence Act need it be proved.
Mere knowledge of landlord about the exclusive possession by the sub-lessee does not draw presumption that landlord had given permission and there is no acquiescence by the landlord. On establishing that the tenant has transferred exclusive possession to another person the court can draw a presumption under section 114 of Evidence Act that the transfer was for a valuable consideration, so as to shift the burden of proof to the tenant to disprove the prima face case of the landlord. If the landlord has to prove subletting by adducing evidence that the transfer for valuable consideration. It may not be possible to prove subletting in any case except rarest of rare case.
The tenant transferring the tenanted premises to his brother amounts to subletting. Landlord need not prove positively adducing evidence that transfer was for valuable consideration need to be proved only in cases where it may not be possible to draw the presumption under section 114(b) of the evidence Act.
Sub tenancy or a sub letting comes into existence when the tenant inducts a third party / stranger into the tenanted accommodation and parts with possession thereof wholly or in part in favour of such third party and puts him in exclusive possession thereof.

12. Defenses
To effectively defend a petition for sub-letting make a partnership deed (not Limited liability partnership as LLP is a separate entity and will constitute subletting) with the original tenant or power of attorney from the original tenant. Denial of title can also be effectively applied to defend this ground.
The conduct of tenant in the proceedings cannot be taken against him when deciding the case on merit. Any of the ground under this Act is to be proved to evict the tenant. Order must be in terms of the provisions of the Act. The tenant can make use of all the delaying tactics without any fear of passing an eviction order against him.
13. Section 11 (4) i and 11 (10)

Once the landlord proves subletting, he is entitled as of right to get eviction. He need not further establish under subsection (10) of section 11 that his claim is bona fide.