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Philatelie Orient Vs. Kodak, Limited - Court Judgment

LegalCrystal Citation
SubjectTenancy
CourtMumbai High Court
Decided On
Case NumberCivil Revision Application No. 1535 of 1953
Judge
Reported in(1955)57BOMLR175
AppellantPhilatelie Orient
RespondentKodak, Limited
Excerpt:
.....of interest, the tenant may do so. the proviso does not enable the tenant to assign the tenancy in a case where there is a prohibition against assignment in the contract of tenancy. - .....tenant to commit a breach of a term of the tenancy. if a tenant was entitled under the contract of tenancy to transfer his interest in premises, then the prohibition against his doing so contained in section 15 was withdrawn and he was allowed to exercise his contractual right. but mr. rele wants me to go further and to hold that the proviso not only permitted the tenant to exercise his contractual right, but permitted him to commit a breach of his contractual obligation. in other words, although the contract between the tenant and the landlord prevented the tenant to assign the premises without the previous consent of the landlord, the legislature in its generosity permitted the tenant to violate the sanctity of the contract and transfer his interest in the premises contrary to the.....
Judgment:

M.C. Chagla, C.J.

1. The opponents are the landlords and they filed an ejectment suit against defendants Nos. 1 and 2. Defendant No. 1 was their tenant and he assigned his right, title and interest in the tenancy to defendant No. 2. The Small Causes Court mada an ejectment order which has been confirmed in appeal, and this is an application in revision against that order.

2. Now, what the Small Causes Court held was that the action of defendant No. 1 in assigning the tenancy came within the prohibition of Section 15 and was not saved by the proviso to that section, and this is the decision that is being challenged by Mr. Rele before me. Now, under Section 12 of the Bombay Rent Act the tenant is protected if he observes and performs the conditions of the tenancy in so far as they are consistent with the provisions of the Act, and Mr. Rele has drawn my attention to the different language used between this section and the original Section 9 of the Act of 1944. There, the obligation upon the tenant to perform the conditions of the tenancy was unqualified, whereas under Section 12 if any provision of the tenancy is inconsistent with the provisions of the Act, then the tenant is not bound to observe that condition. I think there Mr. Rele. is right, but he has got to satisfy me that there is any provision of the Act which is inconsistent with the obligation of the tenant to observe the term of the tenancy with regard to assignment. It is not disputed that under the tenancy agreement between the landlord and the tenant, the tenant could not assign without the previous consent of the landlord, nor is it disputed that the previous consent was not obtained. Nor does Mr. Rele contend that the tenant did not commit a breach of the term of his agreement with the landlord. But his contention is that the tenant is freed from his obligation to observe this condition because it is not consistent with the provisions of the Act.

3. Now, what is relied upon is the proviso to Section 15. The scheme of Section 15 is that the section itself contains an absolute prohibition against subletting of premises or assignment or transfer of premises, and in this respect again the section is different from Section 10 where the subletting was permitted notwithstanding anything to the contrary in any law for the time being in force. Therefore, the present Act contains a complete reversal of the policy of the Legislature and enacts a complete prohibition against sub-letting, assigning or transfer of a tenancy. But a proviso to that section was enacted by a subsequent Act, Act XXXVI of 1948, and the proviso is to the following effect:

Provided that the State Government may, by notification in the Official Gazette, permit in any area the transfer of interest in promises held under such leases or class of leases and to such extent as may be specified in the notification.

Now, admittedly, the premises in question are covered by the Government notification, and what is argued by Mr. Rele is that if the Government issues a notification under the proviso, then the tenant becomes entitled to transfer his interest in the premises notwithstanding the fact that the contract of tenancy prohibits him from doing so. In my opinion that is not the correct interpretation to be put upon the proviso. Section 15 having enacted a complete prohibition, the proviso relaxes that prohibition to the extent set out in the proviso, and the question is what is the extent and nature of that relaxation. The prohibition under s,. 15 is that even though a contract may permit sub-letting or transferor assignment, the sub-letting or assignment or transfer would be unlawful and prohibited. The Legislature by enacting the proviso permits the transfer of interest in certain premises. Therefore the prohibition contained in Section 15 to that extent is relaxed. But the proviso does not mean that the Legislature permitted the tenant to commit a breach of a term of the tenancy. If a tenant was entitled under the contract of tenancy to transfer his interest in premises, then the prohibition against his doing so contained in Section 15 was withdrawn and he was allowed to exercise his contractual right. But Mr. Rele wants me to go further and to hold that the proviso not only permitted the tenant to exercise his contractual right, but permitted him to commit a breach of his contractual obligation. In other words, although the contract between the tenant and the landlord prevented the tenant to assign the premises without the previous consent of the landlord, the Legislature in its generosity permitted the tenant to violate the sanctity of the contract and transfer his interest in the premises contrary to the provisions of the lease. Now, such an interpretation upon the proviso would be contrary to all canons of construction. As I pointed out in Cooper v. Shiavax Cambata : AIR1949Bom131 , that it is a fundamental canon of construction that a Court of law would not permit the sanctity of obligations or of contracts to be interfered with unless the statute in express terms permits a violation of that sanctity, and I do not read the proviso as permitting the tenant in express terms, to violate the sanctity of the contract. In my opinion, the proviso serves the limited purpose of withdrawing the absolute prohibition contained in Section 15 and that absolute prohibition is withdrawn to this extent that if the contract between the landlord and the tenant permits of transfer of interest, then the tenant may do so and should not come within the prohibition contained in Section 15 itself.

4. In my opinion, therefore, the Courts below were right in the conclusion they came to. The result is that the rule is discharged with costs. Stay order vacated. The plaintiffs agree and undertake not to execute the order for ejectment on the petitioners undertaking to give vacant possession of the premises on or before December 31, 1954.


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