MANU/SC/0106/2019

Equivalent Citation: 2019(2)ABR541, AIR2019SC 913, 2019(3)ALD134, 2019(2)ALLMR931, 2019 (133) ALR 773, 2019(1)RC R(Rent)273, 2019
143 RD866, 2019(2)SC ALE345

IN THE SUPREME COURT OF INDIA

Civil Appeal Nos. 5753-5754 of 2011
Decided On: 31.01.2019
Appellants: Mahadev P. Kambekar (D) tr. L.Rs.
Vs.
Respondent: Shree Krishna Woolen Mills Pvt. Ltd.
Hon'ble Judges/Coram:
Abhay Manohar Sapre and R. Subhash Reddy, JJ.
Case Note:
Civil - Counter-claim - Maintainability thereto - Section 41 of Presidency
Small Cause Courts Act, 1882 - Appeal was against order of High Court
holding that, Single Judge wrongly entertained counter-claim filed by
Defendant against Plaintiff as it had no jurisdiction on its original
jurisdiction to entertain counter-claim of this nature in light of the
provisions of Section 41 of Act, 1882- Whether Division Bench was right in
dismissing Defendant's counter-claim as being not maintainable. Facts:
Dispute between parties was related to suit land. Plaintiff claimed to be
lessee of suit land whereas Defendant claimed to be owner/lessor of suit
land on terms set out in indenture of lease deed dated 20th June, 1958
executed between parties. A dispute arose between parties. This led
Defendant to determine lease in question by serving a quit notice dated
19th February, 1980 to Plaintiff requesting them to handover leased
premises, which was in their possession, to Defendant. Plaintiff then filed a
Civil Suit against Defendant on original side of High Court claiming therein
the specific performance of contract (lease deed) in relation to suit land.
Suit was based essentially on Clause 7 of Lease Deed which, according to
Plaintiff, enabled them to elect and exercise their right to purchase the suit
land from Defendant on fulfillment of conditions set out therein. Defendant
denied claim and at same time also filed his counter claim against Plaintiff
seeking their eviction from suit land and arrears of rent. Single Judge by
judgment/decree decreed Plaintiff's suit for specific performance of
contract and directed Defendant to execute conveyance deed in favour of
Plaintiff of suit land. Single Judge also allowed counter claim filed by
Defendant and accordingly passed decree for possession of suit land and
arrears of rent for three years against Plaintiff. Appellants (Defendant) and
Respondent (Plaintiff) both felt aggrieved by judgment/decree passed by
Single Judge and filed their respective appeals before Division Bench.
Division Bench allowed both appeals. So far as appeal filed by Appellants
(Defendant) was concerned, the Division Bench set aside the
judgment/decree and remanded the suit for re-trial to the Single Judge on
merits afresh in accordance with law. So far as appeal filed by Respondent
(Plaintiff) was concerned, Division Bench set aside judgment/decree on
ground that, counter-claim was not maintainable in view of Section 41 of
Presidency Small Cause Courts Act, 1882. Defendant (Appellants herein),
i.e., lessor felt aggrieved by that part of order of Division Bench which
resulted in dismissal of his counter-claim and filed present appeals by way

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 of special leave in present Court. Held, while dismissing the appeal 1. In
Mansukhlal's case, it was observed that, language of Section 41(1) was
clear, suits could lie within the exclusive jurisdiction of Small Cause Court,
Bombay and the City Civil Court would have no jurisdiction to entertain
such suits. [24] 2. In light of law laid down by this Court in Mansukhlal's
case which was later relied on in Prabhudas Damodar Kotecha and Ors. v.
Manhabala Jeram Damodar and Anr. Present Court affirmed view taken by
High Court in impugned judgment which rightly held that, counter-claim
filed by Defendant (Appellants herein) was not maintainable. [25] 3.
Whether it was a suit between licensor and licensee or between landlord
and tenant, such types of suits fall under Section 41 of Small Cause Courts
Act and were, therefore, cognizable by Courts of Small Causes, Bombay.
[29] 4. It was now for parties to raise all such factual issue(s) such as how
much area was leased out, how much area was outside the lease, who were
owners of leased area and areas adjacent to leased area and all incidental
questions arising therefrom before competent Court. [32] 5. It would be for
competent Court to come to its own conclusion on their respective merits
and pass appropriate orders in accordance with law. [33] 6. Appeals
dismissed. [34]
JUDGMENT
Abhay Manohar Sapre, J.
1. These appeals are directed against the final judgment and order dated 19.07.2007
passed by the High Court of Judicature at Bombay in Appeal No. 169 of 1999 in Suit
No. 503 of 1980 and in Appeal No. 199 of 1999 in Suit No. 503 of 1980 whereby the
Division Bench of the High Court allowed both the appeals filed by the Appellants
herein (Defendant) and the Respondent(Plaintiff) herein respectively.
2 . In order to appreciate the controversy involved in these appeals which lies in a
narrow compass, it is necessary to set out the relevant facts hereinbelow.
3 . The Appellants are the legal representatives of Mahadev Pandurang Kambekar,
who was the original Defendant whereas the Respondent-Shree Krishna Woolen Mills
Pvt. Ltd. is the Plaintiff in the Civil Suit out of which these appeal arise.
4. The dispute between the parties relates to the land bearing survey Nos. 58 and 60
(re-numbered as CTS 741, 741/1 to 741/7) situated at Nahur-Bhandup in Bombay
suburban District (hereinafter referred to as "the suit land").
5. The Plaintiff claims to be the lessee of the suit land whereas the Defendant claims
to be the owner/lessor of the suit land on the terms set out in the indenture of the
lease deed dated 20.06.1958 executed between the parties.
6. A dispute arose between the parties. This led the Defendant to determine the lease
in question by serving a quit notice dated 19.02.1980 to the Plaintiff requesting them
to handover the leased premises, which was in their possession, to the Defendant.
7. The Plaintiff then filed a Civil Suit (No. 503 of 1980) against the Defendant on the
original side of the Bombay High Court claiming therein the specific performance of
the contract (lease deed) in relation to the suit land.
8. The suit was based essentially on Clause 7 of the Lease Deed which, according to
the Plaintiff, enabled them to elect and exercise their right to purchase the suit land
from the Defendant on fulfillment of the conditions set out therein.

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 9. The Defendant on being served filed the written statement. The Defendant denied
the claim and at the same time also filed his counter claim against the Plaintiff
seeking their eviction from the suit land and the arrears of rent.
10. The Single Judge by judgment/decree dated 24.12.1998 decreed the Plaintiff's
suit for specific performance of contract and directed the Defendant to execute the
conveyance deed in favour of the Plaintiff of the suit land. The Single Judge also
allowed the counter claim filed by the Defendant and accordingly passed the decree
for possession of the suit land and arrears of rent for three years against the Plaintiff.
11. The Appellants (Defendant) and the Respondent (Plaintiff) both felt aggrieved by
the judgment/decree passed by the Single Judge and filed their respective appeals
before the Division Bench.
1 2 . So far as the Defendant's (Appellants herein) Appeal No. 169/1999 was
concerned, it arose out of the decree passed against him for specific performance of
the contract, whereas so far as the Plaintiff's (Respondent herein) appeal (No.
199/1999) was concerned, it arose out of the decree passed against them for
possession of the suit land and arrears of rent.
13. By impugned judgment, the Division Bench allowed both the appeals. So far as
appeal (169/1999) filed by the Appellants (Defendant) was concerned, the Division
Bench set aside the judgment/decree and remanded the suit for re-trial to the Single
Judge on merits afresh in accordance with law.
14. So far as appeal (199/1999) filed by the Respondent (Plaintiff) was concerned,
the Division Bench set aside the judgment/decree on the ground that the counter-
claim was not maintainable in view of Section 41 of the Presidency Small Cause
Courts Act, 1882 (for short called "the Act 1882"). In other words, the Division Bench
held that so far as counter-claim filed by the Defendant against the Plaintiff is
concerned, the Single Judge wrongly entertained it as it had no jurisdiction on its
original jurisdiction to entertain counter-claim of this nature in the light of the
provisions of Section 41 of the Act 1882.
15. The Defendant (Appellants herein), i.e., lessor felt aggrieved by that part of the
order of the Division Bench which resulted in dismissal of his counter-claim and filed
the present appeals by way of special leave in this Court.
16. So far as the order of the Division Bench which resulted in setting aside of the
judgment/decree of the Single Judge and remanding of the suit for retrial on merits
is concerned, it attained finality as a result of dismissal of SLP filed by the Plaintiff in
this Court.
17. The short question, which arises for consideration in these appeals, is whether
the Division Bench was right in dismissing the Defendant's counter-claim as being
not maintainable.
18. Heard Mr. Shekhar Naphade, learned senior Counsel for the Appellants and Mr.
Shyam Divan, learned senior Counsel for the Respondent.
19. Mr. Naphade, learned senior Counsel appearing for the Appellants (Defendant)
and Mr. Shyam Diwan, learned senior Counsel appearing for the Respondent
(Plaintiff) addressed the Court at length. However, having heard both the learned
Counsel and on perusing the record of the case, we find no merit in these appeals.
20. In our considered opinion, the issue involved in the present appeals remains no

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 longer res integra and is decided by this Court in the case of Mansukhlal Dhanraj Jain
and Ors. v. Eknath Vithal Ogale [MANU/SC/0633/1995 : (1995) 2 SCC 665].
21. In Mansukhlal case (supra), the question arose as to whether the suit filed by the
Plaintiff claiming to be the licensee of the premises on monetary consideration and
seeking permanent injunction restraining the Defendant (licensor) from recovery of
the possession of the premises is cognizable by the City Civil Court, Bombay
constituted under the Bombay City Civil Court Act or is cognizable by the Court of
Small Causes Bombay as per Section 41(1) of the Act, 1882.
22. It is this question, which was examined by this Court in detail in the light of the
relevant provisions of the Bombay City Civil Court Act, the Presidency Small Cause
Courts Act, 1882 and the Bombay Rents, Hotel and Lodging House Rates Control Act,
1947.
23. Having examined the question, their Lordships speaking through Majmudar, J.
held that such suit is cognizable and thus maintainable in the Court of Small Causes,
Bombay.
24. It is apposite to refer the discussion contained in paras 11, 12, 13, 16, 17 and 18
which read as under:
11. In order to resolve the controversy posed for our consideration, it will be
appropriate to note the relevant statutory provision having a direct bearing
on this question. Section 41(1) of the Small Cause Courts Act reads as
under:
41. (1) Notwithstanding anything contained elsewhere in this Act or
in any other law for the time being in force but subject to the
provisions of Sub-section (2), the Court of Small Causes shall have
jurisdiction to entertain and try all suits and proceedings between a
licensor and licensee, or a landlord and tenant, relating to the
recovery of possession of any immovable property situated in
Greater Bombay, or relating to the recovery of the licence fee or
charges or rent thereof, irrespective of the value of the subject-
matter of such suits or proceedings.
12. A mere look at the aforesaid provision makes it clear that because of the
non-obstante Clause contained in the section, even if a suit may otherwise lie
before any other court, if such a suit falls within the sweep of Section 41(1)
it can be entertained only by the Court of Small Causes. In the present
proceedings we are not concerned with the provisions of Sub-section (2) of
Section 41 and hence we do not refer to them. For applicability of Section
41(1) of the Small Cause Courts Act, the following conditions must be
satisfied before taking the view that jurisdiction of regular competent civil
court like City Civil Court is ousted:
(i) It must be a suit or proceeding between the licensee and
licensor; or
(ii) between a landlord and a tenant;
(iii) such suit or proceeding must relate to the recovery of
possession of any property situated in Greater Bombay; or (iv)
relating to the recovery of the licence fee or charges or rent thereof.

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 1 3 . In the present case, we are not concerned with the 2nd and 4th
conditions, as the only contention of the Appellants is that the present suits
do not satisfy conditions 1 and 3 for attracting Section 41(1). The
Respondents claim to the contrary. It is obvious that if the present suits
satisfy conditions 1 and 3 they would clearly attract the applicability of
Section 41(1) of the Act and such suits would be outside the purview of
regular civil court like the City Civil Court. Therefore, the enquiry which
becomes relevant at this stage is to find out from the averments in the
plaints whether these are suits between a licensor and a licensee and
whether they relate to the recovery of possession of immovable property
situated in Greater Bombay.
1 6 . It is, therefore, obvious that the phrase "relating to recovery of
possession" as found in Section 41(1) of the Small Cause Courts Act is
comprehensive in nature and takes in its sweep all types of suits and
proceedings which are concerned with the recovery of possession of suit
property from the licensee and, therefore, suits for permanent injunction
restraining the Defendant from effecting forcible recovery of such possession
from the licensee-Plaintiff would squarely be covered by the wide sweep of
the said phrase. Consequently in the light of the averments in the plaints
under consideration and the prayers sought for therein, on the clear language
of Section 41(1), the conclusion is inevitable that these suits could lie within
the exclusive jurisdiction of Small Cause Court, Bombay and the City Civil
Court would have no jurisdiction to entertain such suits.
1 7 . We may now refer to the relevant decisions of this Court and other
courts to which our attention was invited by learned Counsel for both the
sides. As some of the decisions referred to a pari materia provision as found
in Section 28 of the Bombay Rents, Hotel and Lodging House Rates Control
Act, 1947 (hereinafter referred to as "the Bombay Rent Act"), it will be
necessary to refer to the said provision. Section 28(1) of the Bombay Rent
Act reads as under:
2 8 . Jurisdiction of courts.- Notwithstanding anything contained in
any law and notwithstanding that by reason of the amount of the
claim or for any other reason, the suit or proceeding would not, but
for this provision, be within its jurisdiction,-
(a) in Greater Bombay, the Court of Small Causes, Bombay,
(aa) in any area for which, a Court of Small Causes is
established under the Provincial Small Cause Courts Act,
1887, such Court and
(b) elsewhere, the Court of the Civil Judge (Junior Division)
having jurisdiction in the area in which the premises are
situate or, if there is no such Civil Judge, the Court of the
Civil Judge (Senior Division) having ordinary jurisdiction,
shall have jurisdiction to entertain and try any suit or
proceeding between a landlord and a tenant relating to the
recovery of rent or possession of any premises to which any
of the provisions of this Part apply....
1 8 . When Section 41(1) of the Small Cause Courts Act is read in
juxtaposition with the aforesaid Section 28 of the Bombay Rent Act, it
becomes clear that pari materia words are used about nature of suits in both

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 these provisions for conferring exclusive jurisdiction on Small Cause Courts,
namely, they alone can entertain such suits or proceedings relating to
recovery of possession of premises. It is of course true that Section 41 of the
Small Cause Courts Act deals with such suits between the licensee and
licensor while Section 28 of the Bombay Rent Act deals with suits between
landlord and tenant. But the nature of such suits as contemplated by both
these Sections is the same, namely, it should be the suit relating to the
recovery of possession of premises. Interpreting the phrase "relating to
recovery of possession" as found in Section 28 of the Bombay Rent Act, a
Bench of three learned Judges of this Court in the case of Babulal Bhuramal
v. Nandram Shivram held that a suit for declaration that one of the Plaintiffs
was the tenant of the Defendant landlord and the other Plaintiffs were his
subtenants and they were entitled to be protected from eviction squarely falls
within the exclusive jurisdiction of the Small Cause Court, Bombay Under
Section 28 of the Bombay Rent Act and jurisdiction of the City Civil Court for
entertaining such a suit is excluded. Imam, J. speaking for the three-Judge
Bench in that case observed at page 374 of the report as under:
The present suit filed in the City Civil Court raised in substance a
claim to the effect that the Plaintiffs were the tenants of the premises
within the meaning of the Act. Such a claim was one which arose out
of the Act or any of its provisions. The suit related to possession of
the premises and the right of the landlord to evict any of the
Plaintiffs was denied on the ground that the first Plaintiff was a
tenant within the meaning of the Act and the premises had been
lawfully sublet by him to the second and third Plaintiffs. The City
Civil Court was thus called upon to decide whether the first Plaintiff
was a tenant of the premises within the meaning of the Act and
whether he had lawfully sublet the same to the second and third
Plaintiffs. The City Civil Court, therefore, had to determine whether
the Plaintiffs had established their claim to be in possession of the
premises in accordance with the provisions of the Act.
25. In the light of the law laid down by this Court in Mansukhlal's case (supra) which
was later relied on in Prabhudas Damodar Kotecha and Ors. v. Manhabala Jeram
Damodar and Anr. [MANU/SC/0797/2013 : (2013) 15 SCC 358], we have no
hesitation in affirming the view taken by the High Court in the impugned judgment
which rightly held that the counter-claim filed by the Defendant (Appellants herein) is
not maintainable.
26. In our considered view, the law laid down in these two cases has full application
to the facts of this case and we find no ground to take a different view than what has
been taken by the High Court.
27. The only distinction on the facts of the case of Mansukhlal (supra) and the case
at hand is that in case of Mansukhlal (supra), the dispute was between the licensee
and the licensor in relation to the land, whereas in the case at hand, the dispute is
between the landlord and the tenant.
28. This factual distinction, in our view, is of no significance for deciding the issue in
question against the Appellants by placing reliance on the law laid down in the case
of Mansukhlal (supra) because both the category of cases, i.e., the one arising
between the licensor and the licensee and the other arising between the landlord and
the tenant in relation to the land are governed by Section 41 of the Small Cause
Courts Act.

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 29. In other words, whether it is a suit between the licensor and the licensee or
between the landlord and the tenant, such types of suits fall Under Section 41 of the
Small Cause Courts Act and are, therefore, cognizable by the Courts of Small Causes,
Bombay.
30. This takes us to deal with the next argument of Mr. Naphade, learned senior
Counsel for the Appellants that once the tenancy is determined such suits would not
come within the purview of Section 41 of the Small Cause Courts Act. This argument
was rejected by the Division Bench and, in our view, rightly by placing reliance on
the law laid down by the Bombay High Court in the case of Nagin Mansukhlal Dagli v.
Haribhai Manibhai Patel (MANU/MH/0179/1980 : AIR 1980 Bombay 123) (Para 8 of
the said decision quoted in the impugned order). We approve the law laid down by
the Bombay High Court in the case of Nagin Mansukhlal Dagli (supra) as laying down
the correct principle of law. We, therefore, do not consider it necessary to elaborate
our reasoning more than what we have said.
31. Before parting, we consider it apposite to make it clear that though both learned
senior Counsel in support of their respective submissions referred extensively to the
factual matrix of the case from their respective list of dates, pleadings and the
documents but we have refrained from recording any factual finding on any of the
factual issues.
3 2 . Indeed, in the light of what we have held supra on legal question, it is not
necessary. It is now for the parties to raise all such factual issue(s) such as how
much area was leased out, how much area is outside the lease, who are the owners
of the leased area and the areas adjacent to leased area and all incidental questions
arising therefrom before the competent Court.
33. It is apart from the fact that these factual issues were also not gone into by the
Division Bench and indeed rightly. It is for this reason, we find no ground to deal
with them for the first time in these appeals else it will cause prejudice to the rights
of the parties while prosecuting their grievances before the competent Court. Now, it
will be for the competent Court to come to its own conclusion on their respective
merits and pass appropriate orders in accordance with law.
34. In view of the foregoing discussion and the observations, we find no merit in
these appeals. The appeals thus fail and are accordingly dismissed.
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