M.P. Saxena, J.@mdashThis is a tenant''s petition under Article 226 of the Constitution of India arising out of proceedings u/s 16 of the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972, hereinafter called the Act.
2. Smt. Brinjrani Mehrotra, opposite party No. 3 is the landlady of building No. 75, Malviya Nagar, Allahabad (Old No. 64/74 Yahiyapur, Allahabad). Machinery for extracting oil was installed in it. . Jamuna Oil Mills, the Petitioner, is a firm carrying on the business of extracting oil and other business incidental thereof. Originally there were five partners in this film, namely, Shri K.C. Mehrotra, Shri Narsing Das, Sardar Gur Charan Singh, Sardar Mahar Singh and Sri Sardar Singh. The Petitioner firm took the building along with the machinery etc. installed in it on lease on a monthly rent of Rs. 500/- in 1955. The aforesaid partnership firm continued upto 12-11-1962 when it was reconstituted with only three partners, namely, Shri K.C. Mehrotra, Sardar Gur Charan Singh and Shri Nar Singh Das. It was duly registered as required by Section 58(1) of the Indian Partnership Act, 1932.
3. On 27-5-1968 Gur Charan Singh, one of the partners died apd the partnership stood dissolved in view of Section 42(c) of the Indian Partnership Act.
4. On 7-1-1975 Shri Pradeep Tandon, opposite party No. 2 moved an application before the Rent Control and Eviction Officer for allotment of a portion of this building on the ground that after the death of Sardar Gur Charan Singh, his son and Shri K.C. Mehrotra continued the partnership business. Sri Nar Singh Das ceased to be a partner but on 9-9-1974 he was again inducted as a partner and, as such, the building will be deemed to have fallen vacant within the meaning of Section 12(2) of the Act. It was also alleged that the firm had created vacancy by sub-letting a portion of this building to one Bishambhar Lal for residential purpose.
5. On 17-4-1975 the landlady opposite party No. 3 moved an application before the Rent Control and Eviction Officer to the effect that the building was exempt from the operation of the said Act and be had no jurisdiction to deal with the allotment application. She also gave out that in case the building is deemed to have fallen vacant she may be granted time to move a release application before the disposal of the application for allotment.
6. On 14-7-1975, the Rent Control and Eviction Officer negatived the preliminary objection regarding jurisdiction by observing;
In the absence of lease, I am of the view that the portion of the building in dispute is not exempt from the operation of the Act and it definitely comes within the ambit of the Act.
7. 5-8-1975 was fixed for ascertainment of vacancy. He came to the conclusion that Sri Nar Singh Das was not admitted as a new partner and there was no vacancy within the meaning of Section 12(2) of the Act. The release application moved by the landlady and the application for allotment presented by Shri Pradeep Tandon were rejected on 18-8-1975.
8. Only Pradeep Tandon filed an appeal u/s 18 of the Act and it was decided by the learned III Addl. District Judge, Allahabad on 1-1-1976. The contention of the landlady and Shri Pradeep Tandon that a portion of the building was sublet to Bishambhar Das was negatived. He, however, held that Shri Nar Singn Das was inducted as a new partner on 9-9-1974 and the building should be deemed to have fallen vacant u/s 12(2) of the Act. The question whether the building was covered by the provisions of the Act was left open. The appeal was allowed and the Rent Control and Eviction Officer was directed to notify the vacancy and to dispose of the application for release and allotment according to law.
9. . Jamuna Oil Mills filed a writ petition No. 116-A of 1976 which was heard and decided by Hon''ble Sapru, J. on 5-5-1976. Three questions were pressed before him. Firstly, that the order of the Rent Control and Eviction Officer holding that there was no vacancy was not appealable; Secondly, that the finding of the Distt. Judge that Shri Nar Singh Das ceased to be a partner of the firm after the death of Sardar Gurcharan Singh was perverse and lastly, that even on the findings of fact as recorded by the District Judge, the appeal could not be allowed. The first two contentions were rejected but with regard to the third contention he observed:
It cannot be doubted that a partnership is not a legal entity and consequently all the partners in the firm from 1955 onwards were joint tenants. There is no finding by the District Judge as to the manner in which Nar Singh Das''s interest in the tenancy came to an end. The mere fact that he ceased to be a partner would not determine his right as a joint tenant. In fact the District Judge has not addressed himself to this aspect of the matter at all. The U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972, came into force on 15th July, 1972. It did not determine pre-existing tenancies.
He further observed:
Section 12(2) must be interpreted to mean that where there is a partnership firm in existence which is a tenant of a building when the Act came into force, the induction of a new partner would lead to the creation of a deemed vacancy. Hewever, a person who has a subsisting right in the tenancy along with the partners of the firm can be introduced into partnership without there being a deemed vacancy. The object of this section is to prevent a partnership firm from introducing new tenants. The object of the Act is not to prohibit one of the pre-existing joint tenants from being introduced into the partnership firm.
10. In his opinion the learned District Judge did not record a finding as to whether Shri Nar Singh Das had given up his tenancy rights on the dissolution of the firm consequent on the death of Sardar Gur Charan Singh or the tenancy being montly tenancy and if Nar Singh Das left the partnership he had also ceased to have any interest in the tenancy. These were questions of fact which should have been investigated by the District Judge. Therefore, the writ petition was allowed and the order passed by the learned District Judge was quashed. He was directed to decide the appeal afresh in the light of the observations made in the judgment.
11. On 5-7-1976 the U.P. Amendment Act No. XXVIII of 1976 came into force and provided that all appeals u/s 18 of the Principal Act pending immediately before the commencement of that Act shall be deemed to be revisions preferred under the said section and shall be disposed of accordingly. The appeal was, therefore, treated as a revision and was disposed of as such by the learned Additional District Judge Allahabad, on 24-9-1977. Two preliminary objections were raised before him-one by the Petitioner firm and the other by the landlady. The former contended that the question of vacancy being one of fact, the revisional court was not competent to interfere with the finding of the Rent Control and Eviction Officer. It did not find favour with the learned Additional District Judge.
12. From the side of the landlady it was urged that the building is not governed by the provisions of the Act and the proceedings are not maintainable. The learned Additional District Judge repelled it on the grounds that it was not raised at the time of the hearing of the previous writ petition and because the landlady and her sons in their objections against the proposed assessment of this building by the Nagar Mahapalika had themselves said that the building was governed by the provisions of this Act.
13. After rejecting the preliminary objections the learned Additional District Judge eatered into the question of surrender of tenancy rights by Sri Nar Singh Das and came to the conclusion that there was implied surrender. This conclusion was based on the ground that originally there were five partners in the firm who were joint tenants. The firm was reconstituted on 19-11-1962 with three partners. The outgoing partners were Sardar Singh and Sardar Mahar Singh and it was not the case of either party that these two persons continued to be joint tenants. In 1968 Sardar Gur Gharan Singh died and his son along with Sri K.C. Mehrotra continued the business of the firm. Sri Nar Singh Das retired from the partnership on 29-5-1968 and started functioning as its Manager i.e. in an entirely different capacity. Six rent receipts were issued in the name of . Jamuna Oil Mills after reconstitution of the firm on 29-11-1962. It showed that every time the firm was reconstituted with different partners and the rent was paid by the firm, the outgoing partners impliedly surrendered their tenancy rights. He, therefore, held that the tenancy rights of Shri Nar Singh Das were extinguished by implied surrender after 29-5-1968 when he retired from the firm. He was again admitted as a partner on 9-9-1974 with the result that u/s 12(2) of the Act the building will be deemed to have fallen vacant. The revision application was allowed and the Rent Control and Eviction Officer was directed to notify the vacancy and to dispose of the release and allotment applications afresh according to law. It is against this order that the present writ petition has been filed by Messers Jamuna Oil Mills.
14. A preliminary objection has again been raised from the side of the landlady opposite party No. 3 to the effect that the building in dispute is not amenable to the provisions of the Act and the Rent Control and Eviction Officer had no jurisdiction to dispose of the proceedings. This contention is based on the ground that the building is covered by Clause (d) of Section 2(1) of the Act and is exempt from the operation of this Act. The learned Counsel for the Petitioner has repelled this contention on a number of grounds. For better appreciation of the same it will be proper to discuss each contention separately.
15. In the first place, it is urged that on 17-4-1975 the Rent Control and Eviction Officer had negatived the contention of the landlady but she did not follow any remedy against it and, as such, she cannot raise it now. It has absolutely no force because the interlocutory order passed by the Rent Control and Eviction Officer on the application of the landlady was not revisable u/s 18 of the Act. The Rent Control and Eviction Officer rejected these applications on 18-8-1975 on the ground that there was no vacancy. Sri Pradip Tandon, opposite party, filed an appeal against it and the landlady reiterated her contention. In his order dated 1-1-1976 the learned District Judge while remanding the matter to the Rent Control and Eviction Officer observed as follows with regard to the applicability of the Act:
Certain questions were also raised before me. The learned Counsel raised the question that the premises in question was not within the purview of Act XIII of 1972. I leave this question open and he may agitate the matter before the R.C. & E.O.
16 In the light of the aforesaid observations it was not at all necessary for the landlady to follow any remedy against the order of the learned District Judge dated 1-1-1976 because the questions of maintainability of the application and jurisdiction were left open and the order dated 14-7-1975 will be deemed to have been set aside.
17. In the second place, it is urged that in the previous writ petition No. 116-A of 1976 decided by this Court on 5-5-1976 the landlady did not raise any such objection with the result that this Court considered the solitary question of ''vacancy'' within the meanins of Section 12(2) of the Act and remanded the appeal for rehearing. She is. therefore, estopped from raising it now. The plea of constructive res judicata is also raised. I have given my anxious consideration even to this plea and in my judgment it does not carry much force. In the previous writ petition this Court adverted only to one question, viz. of vacancy and alter quashing the order of the learned District Judge dated 1-1-1976 directed him to dispose of the appeal afresh in the light of the observations made in the judgment. The questions of maintainability and jurisdiction were not gone into. They were obviously to be taken into consideration by the Additional District Judge when he was directed to rehear the appeal. There was no such observation in the judgment that these questions will not be considered. It will not be out of place to refer to certain cases as to what is the effect of a remand order of such a nature. In the case of Mohan Lal v. Anandi Bai AIR 1977 SC 2177 a similar order came up for consideration. The High Court had stated that the judgments and decrees and findings of both the courts were being set aside and the case was being remanded to the trial court for a fresh decision on merits with advertence to the remark in the judgment. It was argued that in making this order the High Court had set aside all findings on all issues; by the trial court and the first appellate court. Their Lordships of the Supreme Court observed:
This is not a correct interpretation of the order. Obviously in directing that findings of both the courts are set aside the High Court was referring to the points which the High Court considered and on which the High Court differed from the lower courts. Findings on other issues which the High Court was not called upon to consider cannot be deemed to be set aside by this order.
18. When the plea not decided by the High Court was subsequently raised it was not held to be raising a new plea altogether. As stated above, the said writ petition was directed against the order of the District Judge dated 1-1-1976. The learned District Judge had kept the question of jurisdiction open. This question was not at all touched by the High Court while disposing of the writ petition No. 116-A of 1976. Therefore, the landlady is neither estopped from raising it nor the principle of res judicata or constructive res judicata applies.
19. in Y.B. Patil v. Y.L. Patil AIR 1977 SC 392 the question of res judicata at subsequent stages of the same proceedings was considered and it was held that once an order made in the course of a proceeding becomes final it would be binding at the subsequent stage of that proceeding. In this case when the whole appeal was directed to be re-heard obviously the question of applicability of the Act and jurisdiction of the magistrate had also to be considered. The decision on these questions never became final so as to have the effect of res judicata. The learned Counsel for the Petitioner has also alluded to certain cases but they are not of much force. In the first place, reliance is placed on the case of
Lower authority is bound by the terms of the remand order. The jurisdiction exercised by Sales Tax Officer was not uninhibited jurisdiction contemplated in an original assessment proceeding. It was controlled by the directions contained in the remand order.
20. The aforesaid case does not advance the Petitioner''s contention much further because in this case there was no such direction of this Court that the question of applicability of the Act or jurisdiction of the magistrate is not to be considered. This Court had not even disposed of this question. The whole appeal having been remanded all the points urged initially could again be urged before the learned Additional District Judge. Reliance is also placed on the case of
21. In
Where a plea of res judicata is founded on general principles of law all that is necessary to establish is that the court that heard and decided the former case was a court of competent jurisdiction, it does not seem necessary in such cases to further prove that it has jurisdiction to hear the latter suit.
22. As will be presently discussed, the building is not amenable to the provisions of the Act and the Rent Control and Eviction Officer or the District Judge had no jurisdiction to declare vacancy in respect of it. It will be governed by the provisions of the general law. Therefore, even if the opposite party No. 3 has not filed a writ petition against the order of the District Judge she is not bound by it and can agitate it in this writ petition. A similar situation arose in the case of
23. Reference may also be made to the case of
A question relating to jurisdiction of a court cannot be deemed to have been finally determined by an erroneous decision of that court. If by an erroneous interpretation of the statute the court holds that it has no jurisdiction, the question would not operate as res judicata. Merely by an erroneous decision, if the court assumes jurisdiction which it does not possess under the statute, the question cannot operate as res judicata between the same parties where the cause of action in the subsequent litigation is the same or otherwise because if those decisions are considered as conclusive it will assume the status of a special rule of law applicable to the parties relating to the jurisdiction of the court in derogation of the rule declared by the legislature.
24. In the instant case the landlady-opposite party has been attacking the jurisdiction of the authority and the maintainability of the application for allotment from the very inception. By doing so, she wanted to keep intact her right against the Petitioner under the general law. She attacked the inherent lack of jurisdiction. This plea can be raised at any stage and on this score also the contention of the opposite party No. 3 cannot be ruled out of consideration.
25. The learned Counsel for the Petitioner has further argued that the landlady herself gave an application u/s 16 for release of the building which shows that she admitted the jurisdiction of the court. It is not at all tenable because in her application which was disposed of by the Rent Control and Eviction Officer on 14-7-1975 she had primarily challenged the maintainability of allotment application moved by Pradeep Tandon and the jurisdiction of the RC & EO to dispose it of. It was in the alternative that she had prayed for release. By no stretch of imagination it can be construed to mean that she had admitted that the building was governed by the provisions of the Act, Had it been so, she would not have pressed this point before the Rent Control and Eviction Officer and the District Judges on two occassions. She is reiterating it even in this Court. The law allows a party to take any defence which is open to him and except where there is a question of estoppel the ethics of a party''s conduct are not relevant. Besides it, jurisdiction cannot be vested by consent. If any authority is needed in this connection reference may be made to the case of
26. It is further urged on behalf of the Petitioner that he had moved an application under Sections 26/27 of the Act for restoration of amenities and u/s 30 for the deposit of rent. According to him, he would not have initiated these proceedings if the provisions of the Act were not applicable to the building. It is also not tenable because the proceeding under Sections 26/27 of the Act were initiated by the Petitioner and by his own act he cannot bring the building under the operation of the Act if otherwise it is not governed by the Act. The same is the position with regard to deposit of rent u/s 30.
27. Upon a careful analysis of the entire matter I am in judgment that the landlady opposite party No. 3 can raise the plea that the building in dispute is exempt from the operation of the new Act. This plea is not barred by estoppel or principle of res judicata.
28. I now proceed to examine on merit the contention whether the building is governed by the provisions of the Act. The landlady''s contention has been that it is exempt from the operation of the said Act by virtue of Section 2(d) which reads as follows:
Any building used or intended to be used for any other industrial purpose (that is to say for the purpose of manufacturing, preservation or processing of any goods) or as a cinema or theatre where the plant and apparatus installed for such purpose in the building is leased out along with the building.
29. In Nirmal Dal Mills v. Smt. Krishna Devi 1978 AWC 93 it has been held that the word ''building'' includes both residential and non-residential structures including factories or mills. Therefore, there can be no manner of doubt that the premises in possession of the Petitioner falls within the definition of the word ''building''. There is no controversy that in 1955 the building along with some machinery installed in it for extracting oil was let out to . Jamuna Oil Mills on a monthly rent of Rs. 500/-. In para 1 of his previous writ petition No. 116-A of 1976 the Petitioner had admitted this fact by alleging:
The Petitioner firm through its partners, namely, Sri K.C. Mehrotra, Sri Narsingh Das, Sardar Gurcharan Singh, Sardar Mehar Singh and Sri Sardar Singh took on rent premises 75, Malviya Nagar, Allahabad (old No. 64/74 Yahiapur, Allahabad) with certain oil mill machinery for running its factory and carrying on its business from the opposite party No. 3 on a monthly rent of Rs. 500/- and is carrying on business since long.
30. These allegations make it clear that the Petitioner-firm had taken the premises along with the oil extracting plant installed in it on lease. This firm was re-constituted in 1962 and again in 1974 and was duly registered. Before the Rent Control and Eviction Officer the landlady had set up that the building is exempt from the operation of the Act. The Petitioner''s agent filed a reply to the effect that two separate leases were created - one in respect of the building and the other about machinery. In the present writ petition the Petitioner had chosen to remain absolutely silent about it. This time they do not say anything whether the machinery was also leased out or not. Besides the admission made in the previous writ petition, there is clear averment in the notice of ejectment dated 6-5-1974 given by the landlady to the Petitioner that the building coupled with the machinery and parts were given on lease to the Petitioner. It is Annexure I to the writ petition. Annexure II is the reply of the Petitioner in which there is no specific denial of this fact. Again in this Court the opposite party No. 3 has filed affidavit to the effect that the premises coupled with the oil extracting machinery installed in it was leased out to the Petitioner. It is needless to say that extraction of oil is industrial purpose inasmuch as oil is manufactured by crushing seeds. In this connection reference may be made to the case of Kunwar Suraj Avtar v. V Addl. Distt. Judge, Bareilly 1977 UPRCC 323 in which it has been held that the provisions of the Act are not applicable to a building used or intended to be used for industrial purposes, I am, therefore, in judgment that the building in dispute is covered by Section 2(1)(d) and is exempt from the operation of the Act.
31. Since the building is exempt from the operation of the Act the question of deemed vacancy does not arise. However, in view of the directions issued in the previous writ petition I'' proceed to examine this aspect also. Section 12 relates to deemed vacancy of building in certain cases. Sub-section (2) of it which is relevant for this case reads as follows:
In the case of a non-residential building where a tenant carrying on business in the building admits a person who is not a member of his family as a partner or a new partner, as the case may be, the tenant shall be deemed to have ceased to occupy the building.
32. The observations made by this Court in previous writ petition in this connection have been reproduced above. It was held that the building was original let out to . Jamuna Oil Mills. As a partnership is not a legal entity all the partners became joint tenants At that time there were five partners including Narsingh Das. He may have ceased to be a partner but that could not determine his right as a joint tenant unless he had surrendered his tenancy rights. The District Judge was, therefore, directed to ascertain whether Narsingh Das had given up his tenancy rights at any time or the tenancy being monthly tenancy Narsingh Das had ceased to have any interest in the tenancy when he left the partnership. For a number of reasons the learned Additional District Judge has come to the conclusion that Narsingh Das will be deemed to have impliedly surrendered his tenancy rights on 29-5-1968.
33. The learned Counsel for the Petitioner has referred to a number of cases to show that there cannot be implied surrender unless the tenant yields up his possession and the lessee takes over possession. He has vehemently argued that it was nobody''s case that the original tenancy ever came to an end and a fresh tenancy was created. It was not pleaded that vacancy occurred due to cessation of tenancy by Nar Singh Das. In her notice dated 6-5-1974 the landlady did not refer to surrender of tenancy rights by Narsingh Das. Similarly no case of surrender was pleaded by Pradip Tandon. In its absence the learned Additional District Judge could not have arrived at the conclusion that there was implied surrender of tenancy by Narsingh Das.
34. To begin with it, it will be proper to give in brief the requirements of express or implied surrender of tenancy rights. Section 111 of the Transfer of Property Act lays down, amongst others, that a tenant can surrender his or her rights expressly or impliedly. Woodfall in his book on ''Landlord and Tenant'', 27th Ed. p. 362 says that "an implied surrender can also be by the conduct of both the parties." He writes "the term surrender by operation of law or implied surrender (there being no distinction) is the expression used to describe all those cases where the law implies surrender from unequivocal conduct of both parties which is inconsistent with the continuance of the existing tenancy."
35. In Amar Krishna v. Nazir Hasan AIR 1939 Oudh 257 at page 267 it was observed:
An implied surrender takes place either by the creation of new relationship between the lessor and the lessee such as the acceptance of a new lease which must operate as implied surrender of the old one or in other ways based on the consent of the parties or by the relinquishment of possession by the lessee and taking over possession by the lessor which would lead to the inference of an implied surrender of the lease.
36. In
37. In K. Venkayya v. T.P. Subbarao AIR 1957 AP 619 it has been held that in India a surrender may be oral and may be inferred from the acts and conduct of the parties as there is no statutory provision. In India if a landlord and tenant by mutual agreement do any act or enter into any transaction which is inconsistent with the continuance of the existing lease or tenancy, there would be an implied surrender. This is merely an application of the general principle of law that in respect of the same subject-matter parties cannot stand to each other in two consistent and incompatible relationship. If the latter transaction can come into effect only on the termination of the earlier, the earlier transaction is deemed or assumed to have been terminated in order to enable the latter to operate according to its tenor. The same view was taken by this Court in
38. The present case may now be examined on the touchstone of this test. Admittedly the building was let out to . Jamuna Oil Mills in 1955. At that time there were five partners of this firm, namely, Sri K.C. Mehrotra, Sri Narsingh Das, Sardar Singh, Sardar Gurcharan Singh and Sardar Mahar Singh. As held in the previous writ petition a partnership not being a legal entity all the five partners will be deemed to have become joint tenants. The question for consideration is whether some of these partners expressly or impliedly surrendered their tenancy rights at any stage. There is certainly no written document relating to surrender, but it can be ascertained from the conduct of the parties also. There is no denying the fact that the original partnership continued upto 1962. It was reconstituted on 19-11-1962 with only three partners, namely, Sri K.C. M|hrotra, Sardar Gurcharan Singh and Sri Narsingh Das. The two outgoing partners were Sardar Mehar Singh and Sri Sardar Singh. The learned Counsel for the opposite party have contended that there being no evidence of payment of rent by the two outgoing partners they will be deemed to have surrendered their tenancy rights. It has no force because even if one of the joint tenants has ceased to pay rent he does not cease to be tenant - vide
39. Guroharan Singh died on 27-5-1968 and the partnership stood dissolved. The partnership deed dated 7-6-1968 simply goes to show that new partnership was carried on by Sri K.C. Mehrotra and Sardar Hardip Singh, son of Sardar Guroharan Singh. It further shows that Sri Narsingh Das had withdrawn from the partnership on 29-5-1968. This document was signed by Sri Narsingh Das as a witness and by Sri K.C. Mehrotra and Sardar Hardip Singh as partners. On its basis also inference of implied surrender of tenancy rights cannot be drawn. All that it goes to show is that Narsingh Das had ceased to be a partner. He may well have continued to be a tenant of the building.
40. Certain notices for renewal of licence under the Factories Act, 1948, were also filed. They were dated 13-11-1969 and 25-11-1970 and were issued in the name of the Petitioner. Narsingh Das was shown as Manager of the firm and Sri K.C. Mehrotra and Sardar Hardip Singh as partners. They also do not lean in favour of surrender. It is true that Sri Narsingh Das did not file his affidavit to show that he did not surrender his tenancy rights, but no adverse inference can be drawn from it because neither Sri Pradip Tandon nor the landlady gave out in their application or affidavits that Sri Narsingh Das bad surrendered his tenancy rights. It was, therefore, not necessary for him to file any affidavit to that effect.
41. Similarly no capital can be made out of the notice dated 6-5-1974 sent by the landlady and its reply given by the Petitioner. When it was not stated in the notice that any of the joint tenants had given up his tenancy rights it was not necessary to raise this point in the reply.
42. Six rent receipts were issued in the name of the Petitioner firm from 1-11-1964 to 31-5-1968. In my judgment they also do not support the contention of implied surrender because any one of the joint tenants could pay rent. Relationship of landlord and tenant can also he created by conduct as held in the case of Jagannath v. Distt. Judge, Mathura (1977) 3 ALR 394 but there is nothing in the conduct of the tenants and the landlady in this case to suggest this inference. The learned Additional District Judge has held that every time the firm was reconstituted with different partners and rent was accepted from the new partners there was implied surrender of tenancy rights by outgoing partners and creation of tenancy with new partners. I am reluctant to subscribe to this view. This question deserves to be considered in relation to the Partnership Act. In
Under Section 14 of the Partnership Act, 1932, property belonging to a person in the absence of an agreement to the contrary, does not on the person entering into a partnership with others, become the property of the partnership merely because it is used for the business of the partnership. It will become property of the partnership only if there is an agreement - express or implied - that the property was, under the agreement of partnership, to be treated as the property of the partnership.
43. It was further held that lease of the property, equipment and personal goodwill will be treated as property of the partners who brought them into the business. In the instant case there is no material on the record to show that leasehold rights were thrown in the partnership property and those who had ceased to be partners had given up their tenancy rights. This inference cannot be drawn by the mere fact that partners of the firm remained changing and the rent was paid in the name of the firm. Therefore tenancy rights will be deemed to have remained intact with the joint tenants and Sri Narsingh Das cannot be said to have surrendered his tenancy rights at any stage. His admission as a partner of this firm could not result in ''deemed vacancy'' u/s 12(2). This section contemplates admission of a non-tenant as a partner and not of an existing tenant as a partner. The learned Additional District Judge committed manifest error of law apparent on the face of the record in arriving at the conclusion that there was ''deemed vacancy''. However, when the building is exempt from the operation of the Act the question of deemed vacancy, release or allotment does not arise.
44. In the result, the writ petition is allowed and the order passed by the learned Additional District Judge on 24-9-1977 is quashed. Costs on parties.
