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Hormazd Kaikhushroo Sethna Vs. Tulsidas Chogumal Chabria of Bombay and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtMumbai High Court
Decided On
Case NumberShort Cause Suit No. 722 of 1973
Judge
Reported in1985(1)BomCR1
ActsBombay Rents, Hotel and Lodging House Rates Control Act, 1947 - Sections 5(4A), 5(11) and 28; Transfer of Property Act, 1882 - Sections 105; Easements Act, 1882 - Sections 52
AppellantHormazd Kaikhushroo Sethna
RespondentTulsidas Chogumal Chabria of Bombay and ors.
Appellant AdvocateH. Suresh and ;S.J. Shah, Advs. and ;Gagrat & Co.
Respondent AdvocateA.V. Bajaj and ;Kamal S. Jain, Advs. for defendants Nos. 1, 3 and 4
DispositionSuit dismissed
Excerpt:
property - lease - sections 5 (4a), 5 (11) and 28 of bombay rents, hotel and lodging house rates control act, 1947, section 105 of transfer of property act, 1882 and section 52 of easements act, 1882 - right to exclusive possession of immovable property is prima facie evidence of agreement of lease - it is not conclusive evidence - there may be agreement which may be surrounding circumstances which may negative this presumption - paramount importance in considering whether agreement is agreement of lease or of licence is intention of parties - intention can be gauged from agreement which was arrived at between parties at about time when transaction was negotiated - in ascertaining intention substance of document must be preferred to form - if interest is created in property it is lease -.....d.n. mehta, j.1. this suit involves the interpretation of the agreement dated 14th june, 1961 between the plaintiff and defendant no. 1 as to whether the said agreement is an agreement of lease or an agreement of leave and licence. all other issues revolve round and are ancillary to this main issue.2. the plaintiff in the suit has prayed, firstly, for a declaration that defendant's nos. 1, 3 and 4 and the original defendant no. 2 are in unauthorised, wrongful and illegal occupation of plot no. 2-a, situated on the first floor of the building known as 'vasant' at peddar road, bombay, now known as dr. g. deshmukh marg. secondly, the plaintiff prays that the defendants, their servants and agents be directed to hand over vacant and peaceful possession of the said flat to the plaintiff......
Judgment:

D.N. Mehta, J.

1. This suit involves the interpretation of the agreement dated 14th June, 1961 between the plaintiff and defendant No. 1 as to whether the said agreement is an agreement of lease or an agreement of leave and licence. All other issues revolve round and are ancillary to this main issue.

2. The plaintiff in the suit has prayed, firstly, for a declaration that defendant's Nos. 1, 3 and 4 and the original defendant No. 2 are in unauthorised, wrongful and illegal occupation of Plot No. 2-A, situated on the first floor of the building known as 'Vasant' at Peddar Road, Bombay, now known as Dr. G. Deshmukh Marg. Secondly, the plaintiff prays that the defendants, their servants and agents be directed to hand over vacant and peaceful possession of the said flat to the plaintiff. Thirdly, the plaintiff prays for a permanent injunction restraining the defendants from entering or remaining upon or using and occupying the said flat. Fourthly, the plaintiff prays for a decree in sum of Rs. 6530/- being damages and/or mesne profits for the wrongful and illegal occupation and trespass upon the said flat and further damages and/or mesne profits at the rate of Rs. 30/- per day from 3rd August, 1973 till vacant and peaceful possession of the flat is delivered or obtained by the plaintiff. Finally, the plaintiff prays for the costs of the suit. The other prayers are interlocutory in nature.

3. The plaintiff is the owner of Flat No. 2-A in the building known as 'Vasant' situated at Peddar Road, Bombay---26. By an agreement dated 14th June, 1961, the plaintiff, it is alleged, granted to defendant No. 1 leave and licence to use and occupy the said flat for a period of three years from 1st June, 1961 on certain terms and conditions. Defendants Nos. 3 and 4 are the brothers of defendant No. 1. Defendant No. 2 was the mother of defendants Nos. 1, 3, and 4. She died sometimes in the year 1980. The plaintiff has thereafter brought as her heirs and legal representatives the three married daughters of defendants No. 2 i.e. Meena Arjandas Gwalani as defendant No. 2(a), Leela B. Bathijo as defendant No. 2(b) and Laxmibai K. Nagpal as defendant No. 2(c). Mr. Bajaj, the learned Advocate appearing on behalf of defendants Nos. 1, 3 and 4 has conceded that defendants Nos. 2(a), 2(b), and 2(c) are the married daughters of defendant No. 2 and have at no stage resided in the suit flat, except for occasional visits. Defendants Nos. 1, 3 and 4, however, have contended that they resided in the suit flat along with their parents from the date of agreement, i.e., from 1st June, 1961.

4. In the plaint, the plaintiff has averred that by an agreement dated 24th October, 1959, his father and mother Dr. Kaikhushroo S. Sethna and Mrs. Roshan K. Sethna, respectively, agreed to purchase from one Mohanlal Tulsidas, Flat No. 2-A of the building known as 'Vasant' (hereinafter referred to as 'the suit flat') situated at Peddar Road, Bombay, for a price and upon the terms and conditions contained in the said agreement. Dr. Kaikhushroo Sethna, the father of the plaintiff, died on 12th December, 1959. Mrs. Roshan K. Sethna, mother of plaintiff, died on 24th March, 1961 and the plaintiff being the only hair and legal representative of his father and mother, became the owner of the suit flat.

5. The plaintiff then averred that since he was not residing in Bombay and was employed at Calcutta in or about 1961, he did not require the suit flat for his personal use. By an agreement of leave and licence dated 14th June, 1961 between the plaintiff and defendant No. 1 the plaintiff granted to defendant No. 1 leave and licence to occupy the said flat as plaintiff's licensee for a period of three years from 1st June, 1961 on certain terms and conditions stated in the said agreements.

6.` The plaintiff then averred that the first defendant occupied the said flat on his licensee along with his wife and children before a Co-operative Housing Society was formed by the purchasers of the various flats in the said building 'Vasant'. After the said society was registered on or about 4th April, 1963 under the Maharashtra Co-operative Societies Act, the same was known as 'Vasant Mills Co-operative Housing Society Ltd.' The plaintiff as the owner of one of the flats, became a member of the society and purchased five shares of the value of Rs. 50/- each in the said Society.

7. The plaintiff then stated that after the period of the expiry of the said agreement of leave and licence, the first defendant with his wife and children continued to occupy the said flat as a licensee of the plaintiff, determinable by notice, but otherwise on the same terms and conditions as contained in the said agreements of leave and licence. The plaintiff subsequently came to learn that defendant No. 1 had purchased an ownership flat in a building known as 'Miramar' situated at Napean Sea Road, now known as L. Jagmohandas Marg, and had vacated and parted possession of the said flat without the knowledge of the plaintiff and put the original defendant No. 2 and defendants Nos. 3 and 4 in possession of the said flat taking advantage of the plaintiff's absence from Bombay. The plaintiff stated that the licence fees for a period of 13 months commencing from October 1971 to October, 1972 amounting to Rs. 5,200/- were also in arrears and the plaintiff by his Attorney's letter dated 11th October, 1972 addressed to defendant No. 1 terminated the said licence granted by him to defendant No. 1 and called upon him to deliver vacant possession of the said flat to the plaintiff on the ground that the defendant had committed a breach of the said agreement inasmuch as he had parted with possession of the suit flat and had gone to stay in the building known as 'Miramar' putting his mother and his brothers in possession of the said flat. In the said letter the plaintiff also claimed compensation for the wrongful occupation and use at the rate of Rs. 30/- per day during which defendant No. 1 continued in wrongful occupations and use of the said flat.

8. By their Advocate's letter dated 3rd November, 1972 addressed to the plaintiff's Attorneys the defendants stated that the agreement of leave and licence was entered into between the plaintiff and defendant No. 1 on the understanding that defendant No. 1 would be a party to the licence agreements for and on behalf of and as benamidar of the other members of his family i.e., his mother, brothers, etc. who also resided with defendant No. 1 from time the agreement of leave and licence was entered into. By the said letter the defendant also stated that they were in exclusive possession from 14th June, 1961 and that the plaintiff had assured them that their possession would at no time be disturbed and that, in fact, a tenancy in respect of the suit premises had been granted by the plaintiff to defendant Nos. 1, 2, 3 and 4. Defendant No. 1 under the said letter admitted having shifted his residence to the building known as 'Miramar', but stated that he came to stay in the suit flat often. By the said letter the defendant forwarded a sum of Rs. 5,200/- by cheque in respect of the arrears of the licence fees or compensation without prejudice to their rights and contentions.

9. The plaintiff by his Attorney's letter dated 20th November, 1972 denied the various allegations made by the defendants in their Advocate's letter. The plaintiff under the said letter pointed out to the defendants that the licence agreement expressly provided that defendant No. 1 was to use the suit flat for his personal use with the members of his family i.e., his wife and children. The plaintiff stated that the story put forth by the defendants that defendant No. 1 acted or was acting as benamidar for his brothers and mother was a fabricated story. The plaintiff under the said letter stated that if defendant No. 1 had been residing in the suit flat along with defendants Nos. 2, 3 and 4, then it was done in clear breach of the provisions of the agreement of leave and licence that defendants Nos. 2, 3 and 4 had no right to stay in the suit flat without informing the plaintiff.

10. The plaintiff stated in the plaint that by his Advocate's letter dated 11th October, 1972 he had revoked and terminated the licence granted by him to the first defendant and that the first defendant had no right to continue or remain in possession of the said flat. Defendants Nos. 2, 3 and 4 also had no right to enter into or remain in possession of the suit flat and that after the termination of the said licence the defendants continued to remain in possession as trespassers. The plaintiff stated that by reason of the fact that defendant No. 1 and defendants Nos. 2, 3 and 4 had failed to hand over quiet, vacant and peaceful possession of the said flat to the plaintiff and have continued to remain upon the suit flat as trespassers, the plaintiff was entitled in law to recover from defendant No. 1 compensation and damages for the wrongful occupation and use at the rate of Rs. 30/- per day for such time as the defendants continued in wrongful and illegal occupation and use of the suit flat. The plaintiff stated that he had become entitled to recover compensation and/or mesne profits from the defendants from 5th November, 1972 for the wrongful and illegal occupation and use until vacant and peaceful possession was handed over to the plaintiff.

11. The plaintiff has prayed for the reliefs as aforesaid.

12. The defendants filed their written statements on 5th July, 1979. The defendant in their written statement contended that this Court had no jurisdiction to entertain and dispose of the suit as the defendants claimed to be tenants of the suit premises, and further that a relationship as between a landlord and a tenant existed between the plaintiff and the defendants and the suit being for possession, the Court of Small Causes alone had jurisdiction to entertain and dispose of the suit.

13. The defendants further stated that the suit was not properly valued and that proper Court-fees had not been paid and on that ground also the suit ought to be dismissed.

14. The defendants stated that in or about June 1961 they were searching for some permanent residential accommodation in Bombay as they were carrying on business and had their vocation in Bombay. Defendant No. 1 was searching for some permanent residence for himself and other members of his family as they were all residing together and intended to continue to do so. The defendants stated that defendant No. 1 came to know from an agent of the plaintiff that the suit flat was vacant and was ready for occupation and as the plaintiff resided at Pune and carried on his business at Pune and as he had no intention to settle down in Bombay, the plaintiff needed someone who would permanently reside in the suit flat and pay the rent demanded by him. The defendants stated that as they were in urgent need of residential accomodation, they agreed to occupy the flat and pay the rent demanded by the plaintiff. The defendants, however, were informed that as the Bombay Rent Act was in force and as the plaintiff would not be permitted to collect rent more than the standard rent if the transaction was termed as one between a landlord and tenant, the agreement to be entered into would be made out as an agreement of leave and licence between the parties. The defendants stated that they agreed to the said suggestion as they had no choice. The defendants, however, were assured by the plaintiff that he was interested only in recovering rent from the premises and so long as he was assured of the rent he would not disturb possession of the defendants in respect of the suit flat. The defendants stated that the plaintiff was aware that the premises were required by defendants No. 1 for his family i.e. his brothers, mother etc. and that they were staying together. The plaintiff, however, informed the defendants that the agreement would be entered into between himself and defendants No. 1 alone as the same would be convenient for all concerned. The defendants stated that the plaintiff knew from the inception that defendant No. 1 was entering into the agreement on behalf of himself and the other defendants and that defendants No. 1 intended to use and occupy the said flat along with defendants Nos. 2, 3 and 4 i.e. his mother and brothers. The defendants stated that the plaintiff had received rent from all the defendants by way of cheques and had acknowledged defendants Nos. 1 to 4 as tenants.

15. The defendants stated that the plaintiff at all material times resided at Pune and had informed the defendants that the he had no intention of residing in Bombay and as such would not be requiring the suit flat for his personal use and that he needed some responsible person who could take care of the flat and pay the rent that was demanded by him. The defendants stated that the agreement dated 14th June, 1961 was a colourable and sham document entered into for the purpose of avoiding the provisions of the Rent Act in respect of rent. The defendants stated that many of the provision of the said agreement dated 14th June, 1961 were consistent with the provisions of a tenancy agreement. The defendants stated that though the agreement dated 14th June, 1961 was termed as a leave and licence agreement the same was treated and construed by the parties as an agreement of tenancy as contemplated under the provisions of the Transfer of Property Act. The defendants stated that the plaintiff had assured them that some of the provisions of the agreement e.g. the period of three years would not be insisted upon or acted upon as the plaintiff had no intention of returning or setting down in Bombay. The defendants stated that the conduct of the parties coupled with other circumstances amply supported the statements made by the defendants in their written statement.

16. The defendants stated that from the inception of the agreement, the defendants had occupied the premises as tenants and at no time was the agreement regards as an agreement of licence.

17. The defendants them stated that since his brother got married and the suit that flat having proved to be inadequate for their expanding family members and in order to provide greater privacy for his brothers, defendant No. 1 left the suit premises and shifted to another flat. The defendants denied that defendants No. 1 shifted to his new premises without the knowledge of the plaintiff. The defendants stated that the agreement dated 14th June, 1961 was an agreement creating a tenancy and that they were tenants in respect of the suit flat and were protected by the Rent Act and the question of determination of licence or handing over possession did not arise. The defendants stated that defendants Nos. 2, 3 and 4 were already in occupation and possession of the flat. The defendants stated that the rent of Rs. 400/- was excessive and exorbitant looking to the circumstances prevailing at the time when the agreement was entered into. The defendants stated that the standard rent of the premises would not be more than Rs. 125/- per month. The defendants denied that the plaintiff was entitled to recover at the rate of Rs. 30/- per day or any other amount by way of compensation and/or damages and/or mesne profits. The defendants denied that they continued in possession of the premises as trespassers. The defendants denied that they were liable to pay to the plaintiff Rs. 6,530/- or any other amount save and except the standard rent due and recoverable by the plaintiff.

18. The defendants stated that as tenants of the suit flat, there was no question of revoking any licence or recovering possession of the suit flat as prayed for by the plaintiff. The defendants stated that they were entitled to use and enjoy the suit flat. The defendants denied that the plaintiff was entitled to any relief. The defendants stated that the suit was false, frivolous and vexatious and bad in law and the same be dismissed with costs.

19. On the above pleadings, the following eleven issues were raised :---

1) Whether this Court has no jurisdiction to entertain and try this suit as pleaded in paragraph 3 of the written statement.

2) Whether the suit is not properly valued for the purpose of Court fees as alleged in paragraph 4 of the written statement.

3) Whether the plaintiff proves that he granted leave and licence to defendant No. 1 as per the agreement dated 14th June, 1961.

4) Whether the said licence stood terminated or revoked as stated in paragraph 8 of the plaint.

5) If the answers to Issues Nos. 3 and 4 above are in the affirmative, whether the defendants are trespassers.

6) Whether the defendants prove that the agreement dated 14th June, 1961 was entered into between the plaintiff and defendant No. 1 for himself and for and on behalf of the other defendants as stated in paragraph 6 of the written statement.

7) Whether the defendants prove that the agreement dated 14th June, 1961 is a colourable and sham document entered into for the purpose of avoiding the provisions of the Bombay Rent Act, as stated in paragraph 8 of the written statement.

8) Whether the defendants prove that the agreement dated 14th June, 1961 is a tenancy agreement as contemplated under the provisions of the Transfer of Property Act, as stated in paragraph 8 of the written statement.

9) Whether the plaintiff is entitled to recover Rs. 6,530/- towards compensation or damages as per the particulars of Exhibit 'D' to the plaint.

10) Whether the plaintiff is entitled to mesne profits or compensation and if so, at what rate.

11) What reliefs ?

20. Issue No. 1 : I shall now deal with the issue of jurisdiction of this Court. Issue No. 1 is whether this Court has no jurisdiction to entertain and try the suit. Before I deal with the legal submissions of the learned Advocates, it will be pertinent at this stage to refer to the evidence given by the plaintiff.

21. The plaintiff deposed that he was the only son of his parents. His father Dr. Kaikhushroo Sethna was employed as a Medical Officer at Delhi. After his retirement, his father settled down in Bombay. His father died in December 1959 and his mother died in March 1961. In 1959 the plaintiff found employment with Shalimar Tar Products Ltd., at Calcutta. In 1959 the plaintiff came down to Bombay. In April 1961 he was posted for a few months in Assam. The suit flat in the building known as 'Vasant' at Peddar Road, Bombay, was purchased by his parents in 1959. At present the suit flat stood in his name. Since he was posted in Assam in 1961, he had left the management of his flat in the hands of his first cousin Rustom Gagrat, who was a solicitor of this Court. The plaintiff stated that as he did not require the flat for his personal use, he had asked Gargrat to see that the flat was given to somebody for a temporary period while he was out of Bombay.

22. Gagrat then informed him that he had given the flat on leave and licence basis to one Tulsidas Chabria, defendant No. 1. The plaintiff stated that the agreement of leave and licence was forwarded to him by Gagrat at Calcutta to be signed by him. When he received the agreement, it was already signed by defendant No. 1. The plaintiff then stated that he had received the agreement of leave and licence from Gagrat in Bombay while he was on one of his short visits. The agreement of leave and licence dated 14-6-1961 has been tendered and marked as Ex. 'A'.

23. The plaintiff then stated that he was employed with Shalimar Tar Products till 1969. In 1969 his services were terminated by his employers. The plaintiff, therefore, came down to Bombay to rehabilitate himself. The plaintiff did not have any premises of his own in Bombay. He tried to search for some accommodation for himself, but failed to obtain the same. The plaintiff then along with his family shifted to Pune, where, in the first instance, he obtained some rented accommodation. In 1969 while he was searching for accommodation in Bombay, the plaintiff approached defendant No. 1 and asked defendant No. 1 to give back possession of the flat to him as the same was required by him for his personal use. Defendant No. 1 however, refused to hand over the flat to him. The plaintiff stated that till the date of his evidence, he was residing in Pune. The plaintiff stated that from June 1961 till 1970 compensation in respect of the flat was collected by M/s. Gagrat and Company from defendant No. 1 In 1961 he had not met defendant No. 1 at any time. In August 1973 the plaintiff filed the present suit.

24. The plaintiff then stated that the suit flat was situated in the building known as 'Vasant Villa Co-operative Housing Society' which was formed in April 1963. During the period from 1963 to 1966, the maintenance charges and other outgoings of the society came to about Rs. 155/- per month. From 1973 onwards the maintenance and other outgoings had increased to Rs. 342/- per month. The plaintiff stated that he paid all the charges and outgoings each month. The plaintiff stated that his father had purchased the suit flat for Rs. 27,000/- in 1959. The area of the flat is 915 sq. ft. approximately.

25. The plaintiff then stated that he had met defendant No. 1, for the first time in Bombay in 1969. He had at no time met defendants Nos. 3 and 4. He met defendant No. 2 once during her life-time in 1969 when he went to visit the flat. This is the oral testimony of the plaintiff in his examination-in-chief.

26. The plaintiff has examined his cousin Rustom Ardeshir Gagrat, who was an erstwhile senior solicitor in the days when the dual system held away on the Original Side. At present he is a Senior Advocate of this Court and a venerable figure in the profession. Gagrat stated that he was a senior partner in Messrs. Gagrat and Company. The plaintiff was his maternal cousin. The plaintiff's parents were his maternal uncle and aunt. Gagrat stated that Dr. Kaikhushroo was employed as a Medical Officer with the Delhi Municipality. In 1947 he retired from service and proceeded to London with his wife for sometime. Kaikhushroo returned to Bombay in the fifties. After returning to Bombay, Kaikhushroo was in search of some accommodation in Bombay. Kaikhushroo approached Gagrat and asked him whether he knew of some vacant premises. Gagrat stated that his sister Naju Vesavewalla resided in the building known as 'Vasant' on the second floor. He made enquiries with his sister Naju and she informed him that a flat on the first floor of the building in which she resided was vacant. Gagrat stated that he than got in touch with Ram Dadlani, who was an estate broker, and negotiated for the purchase of the flat on the first floor. Gagrat stated that he knew Dadlani as he had also negotiated the transaction at the time of the purchase of his sister's flat. Kaikhushroo was able to purchase the flat on the first floor of the building 'Vasant' through Ram Dadlani. Gagrat has produced the agreements dated 24th October, 1959 which has been marked Ex. F. The same was attested by Gagrat.

27. Gagrat then stated that sometime in November 1959 his uncle and aunt shifted to the new flat. A religious ceremony was performed one morning in the said flat. On the same night unfortunately, Gagrat's uncle i.e. the plaintiff's father suffered a heart-attack. Gagrat stated that his brother, who was a Doctor, was summoned immediately and his uncle was shifted to a hospital. He died eight or ten days later. Two years later in 1961 his aunt died.

28. In 1959 the plaintiff was employed in Shalimar Tar Products Ltd.; and was posted somewhere in Calcutta or Assam. Before leaving Bombay, the plaintiff met Gagrat and requested him to look after the suit flat and to give it to someone on temporary basis still he returned to Bombay. Gagrat stated that in these circumstances, he again contacted Ram Dadlani. Gagrat stated that Dadlani came to his office. He, however, was not present. Hence Dadlani left a letter for him. In the said letter, which has been marked as Ex. No. 1. Dadlani informed Gagrat that he knew of a good party named Tulsidas Chabria who was willing to occupy the flat. Dadlani stated that the party would furnish Lloyds Bank's guarantee by Mr. Daulatram Chatmawel. Dadlani also informed Gagrat in the said letter that the party required immediate possession and requested Gagrat to do the needful in the matter.

29. Gagrat then deposed that after sometime Tulsidas Chabria, defendant No. 1 saw him at his office. Gagrat stated that he informed defendant No. 1 that he was willing to give the flat for a temporary period on leave and licence basis. Gagrat stated that defendant No. 1 told him that the flat was required by him for his use and that of his family consisting of his wife and two sons. Gagrat stated that he had prepared as per usual routine, the Attendance Note after the interview. Gagrat has produced the Attendance Note dated 1st June, 1961, which has been marked as Ex. G. Gagrat then stated that after this visit by defendant No. 1 he prepared an agreement of leave and licence, which was Ex. A. It was signed by defendant No. 1 and he attested the signature of defendant No. 1. Gagrat stated that he then forwarded the agreement in duplicate to the plaintiff at Calcutta. However, at or about this time the plaintiff came down to Bombay and executed the agreement here in Bombay. Gagrat stated that after he had received the agreement from the plaintiff, he wrote to defendant No. 1 asking him to collect his copy of the agreement from his office. Latter the defendant came and collected his copy of the agreement from his office.

30. Gagrat then stated that the plaintiff had requested him to collect the amount of compensation of the suit flat while he was out of Bombay. Gagrat stated that he then arranged to collect the same through his office.

31. Gagrat then stated that he had not instructed Ram Dadlani at any time to insert an advertisement with regard to the suit flat. Neither he not his company had inserted any advertisement in any newspaper. Gagrat stated that he had not paid any commission to Ram Dadlani.

32. Mr. Bajaj on behalf of the defendants contended that this Court would have no jurisdiction to entertain the suit under section 28 of the Bombay Rents, Hotel and Lodging House Rates control Act, 1947. Mr. Bajaj contended that a relationship of a landlord and a tenant existed as between the plaintiff and the defendants and since this was a suit for recovery of possession, the Court of Small Causes alone had jurisdiction to try the suit. Mr. Bajaj submitted that the agreement dated 14th June, 1961 was labelled as an agreement of leave and licence. In effect, it was an agreement of lease and that a tenancy was created in respect of the suit flat and for that reason the only Court which could decide the question would be the Rent Court. Mr. Bajaj has taken me through number of authorities of the Supreme Court and also of this Court to prove that the agreement of leave and licence was in fact an agreement of lease. I shall consider these authorities presently.

33. Mr. Suresh, the learned Advocate appearing on behalf of the plaintiff, has submitted that for the purpose of deciding the issue of jurisdiction, the Court need not go into the evidence or to the other documents, but only to the averments made in the plaint. If the averments made in the plaint revealed that a relationship of a licensor and a licensee existed and not that of a landlord and a tenant, then this Court would be competent to try the suit and the bar of section 28 of the Rent Act would not then prevail. Mr. Suresh relied upon the decision of a Division Bench of this Court in the case of Laxmibai Narayan Satesa v. Dattatraya Tukaram Jarende, reported in : AIR1983Bom289 in support of his submission. The Learned Judges were pleased to lay down :---

' These observations make it quite clear that the jurisdiction of the Court to entertain the suit is to be ascertained from the averments in the plaint and not on the basis of defendants raised in the written statement. If the averments in the plaint make out only the relationship of a licensor and licensee as in the present case, and do not plead any relationship of a landlord or tenant or does not involve any question arising under the Rent Act, than, only the Civil Court has jurisdiction to try the suit.

.... ... ... ...

Our attention was also drawn by the learned Counsel for the defendant to a decision of the Supreme Court in the case of Natraj Studios (P) Ltd. v. Navrang Studios A.I.R. 1981 S.C. 537. There also the Court while dealing with the question of jurisdiction quoted with approval, at page 545 of the report, the observations of this Court in its decision in the case of Govindram Salamatral Bachani v. Dharampal Amarnath Puri, : AIR1951Bom390 to the effect that the question was a jurisdictional question and had nothing to do with the Act or any of its provisions. Whether a person was a tenant or a licensee or a trespasser was a question which was not left to the exclusive determination of the Special Court set up under the Rent Control Act but the question whether a person was entitled to the benefit of any of the provisions of the Act was a question which could only be decided and determined by Special Court.'

The said decisions, therefore, clearly showed that the jurisdiction of the Court was to be determined only from the averments in the plaint and not on the defence in the written statement or on the issues raised and it was only the Court in which the suit was filed which had the jurisdiction to determine the same.'

34. In view of the ratio laid down in the above case decided by a Division Bench, and which decision is binding on me, I shall consider the various averments made in the plaint. I have in paragraphs 4 to 10 briefly referred to the averments made in the plaint. I shall now consider these averments in some detail. In paragraph 3 of the plaint, the plaintiff has averred that as he was not residing at Bombay, he did not immediately require the suit flat. By an agreements of leave and licence between the plaintiff and the defendant No. 1 dated 14th June, 1961, the plaintiff granted to defendant No. 1 leave and licence to occupy and use the said flat as the plaintiff's licensee for a period of three years from 1st June, 1961 on the terms and conditions stated therein. In paragraph 5 of the plaint, the plaintiff averred that pursuant to the agreement defendant No. 1 occupied the said flat as a licensee with his wife and children before the formation of the Co-operative Housing Society of the purchasers of the various flats of the building 'Vasant'. The said Society was formed and registered sometime in April 1963 under the Maharashtra Co-operative Societies Act and the same was thereafter known as 'Vasant Villa Co-operative Housing Society Ltd.' The plaintiff stated that as an owner of one of the flats, he became a member of the said Society and five shares of the face value of Rs. 50/- each were allotted to him. In paragraph 6 the plaintiff stated that after the period of expiry of the agreement of leave and licence, the first defendant along with his wife and children continued in occupation of the said flat as a licensee of the plaintiff, which licence was determinable by notice, but otherwise on the same terms and conditions as contained in the leave and licence agreement.

35. In paragraph 7, the plaintiff averred that he subsequently came to learn that defendant No. 1 had purchased an ownership flat in a building known as 'Miramar' situated at Napean Sea Road, now known as L. Jagmohandas Marg and had vacated and parted with possession of the suit flat without the knowledge of the plaintiff and put defendants Nos. 2, 3, and 4 in possession of the suit flat taking advantage of the plaintiff's absence from Bombay. The plaintiff stated that the licence fees for a period of 13 months commencing from October 1971 to October 1972, amounting to Rs. 5,200/- were in arrears and unpaid. The plaintiff by his Attorney's letter dated 11th October, 1972 addressed to defendant No. 1 informed him that the plaintiff had come to know that defendant No. 1 and the members of his family had vacated and parted with possession of the said flat and had gone to stay at 'Miramar' and had put his mother and brothers in possession of the said flat which was given to defendant No. 1 on a licence for the personal use defendant No. 1 and the members of his family only and thus defendant No. 1 had committed a breach of the agreement of leave and licence. By the said letter the plaintiff terminated the licence which was granted to defendant No. 1 and called upon him to deliver vacant possession of the flat to the plaintiff on the expiry of 21 days from the receipt of the said letter by him. Defendant No. 1 was also called upon under the said letter to pay compensation for the wrongful use and occupation at the rate of Rs. 30/- per day during which he continued in wrongful occupation and use of the said flat. The defendant by their Advocate's letter dated 3rd November, 1972, for the first time, falsely alleged that the said agreement of leave and licence was entered into by the parties on the clear understanding that defendant No. 1 would be a party to the said agreement of leave and licence as Benamidar of the other members of his family, i.e., his brothers, mother etc. who, he falsely alleged, resided with him at the time when the agreement of leave and licence was entered into. The defendant also falsely alleged that they were in exclusive possession from 14th June, 1961 and that the plaintiff had assured them that their possession at no time would be disturbed and that in fact a tenancy in respect of the licensed premises was given by the plaintiff to the defendants. By the said letter defendant No. 1 admitted that he had shifted to 'Miramar' where he was staying, but falsely alleged that he came and stayed at the suit flat of and on. By the said letter the defendants forwarded a sum of Rs. 5,200/- by cheque in respect of the arrears of the licence fees or compensation which was received by the plaintiff without prejudice. The plaintiff by his Attorneys's letter dated 20th November, 1972 denied the false allegations made by the defendants in their Advocate's letter and denied that there was any understanding between the plaintiff and defendant No. 1 at the time of the execution of the agreement of leave and licence that defendant No. 1 was acting as Benamidar for his brothers and mother. By the said letter the plaintiff drew the attention of the defendants to Clause 5 of the agreement of leave and licence which expressly provided that defendant No. 1 was to use the flat for his personal use with members of his family i.e. his wife and children. The plaintiff pointed out that even if defendants Nos. 2, 3 and 4 were residing with defendant No. 1 in the said premises from the date of the agreement, the same was in clear breach of the provisions of the agreement of leave and licence and defendant Nos. 2, 3 and 4 had no right to stay or reside in the said flat without informing the plaintiff. The plaintiff by his Attorney's letter dated 25th November, 1972 forwarded a receipt for Rs. 5,200/- without prejudice. Thereafter the defendants forwarded another cheque of Rs. 800/- towards arrears of licence fee for the months of November and December 1972.

36. In paragraph 8 of the plaint, the plaintiff averred that by his Attorney's letter dated 11th October, 1972 he revoked and terminated the licence granted to the first defendant and the first defendant had no right to continue to remain in possession of the said flat. The plaintiff stated that defendants Nos. 2, 3 and 4 had no right to enter into or remain in possession of the plaintiff's said flat. In any event, the licence of the first defendant having been revoked and property terminated, defendants Nos. 2, 3 and 4 had no right to remain in possession on and after the termination of the licence.

37. In paragraph 9 the plaintiff stated that the first defendant was liable to pay compensation and/or damages calculated at the rate of Rs. 30/- per day from 5th November, 1972 till the time he continued to remain in possession of the suit flat. In paragraph 10 of the plaint the plaintiff stated that the first defendant having failed to hand over quiet, vacant and peaceful possession of the flat to the plaintiff, and defendants Nos. 2, 3 and 4 continuing to remain in the said flat as trespassers, the plaintiff was entitled to recover from defendant No. 1 compensation or damages for the wrongful use and occupation of the said flat at the rate of Rs. 30/- per day till such time as the first defendant continued in such wrongful occupation. In paragraphs 11 and 12 the plaintiff has made put a case for interim injunction and for Court Receiver of the suit flat.

38. From the averments made in the plaint, it is clear that the plaintiff has alleged a relationship of licensor and licensee as between him and the first defendant. At no place has the plaintiff claimed a relationship of a landlord and tenant as between him and the first defendant and, therefore, to my mind, the embargo on the Civil Court under section 28 of the Rent Act would not apply. That being the case, this Court would be competent to try the suit and following the observations of this Court in the case of Laxmibai v. Dattatraya referred heretofore, I hold that this Court is competent to try the suit. I, therefore, answer Issue No. 1 in the negative.

39. Issues Nos. 3 and 8; I shall now address myself to Issues Nos. 3 and 8, Issue Nos. 3 is whether the plaintiff proves that he granted leave and licence to defendant No. 1 as per the agreement dated 14 June, 1961. Issue No. 8 is whether the defendants prove that the agreement dated 14th June, 1961 is a tenancy agreement as contemplated under the provisions of the Transfer of Property Act, as stated in paragraph 8 of the written statement.

40. Mr. Bajaj has submitted that the Court must Judge these two issues, firstly, on the basis of the clauses contained in the said agreement and secondly, on the basis of the surrounding circumstances. Mr. Bajaj contended that if the clauses of the agreement were correctly interpreted, they would reveal that the document created a lease in favour of defendant No. 1. Mr. Bajaj contended that the surrounding circumstances indicated that what the plaintiff had granted to defendants No. 1 was not a licence, but a tenancy in respect of the suit premises. Mr. Bajaj, therefore, contended that if the Court came to the conclusion on the basis of the evidence and the documents admitted in evidence, that a relationship of landlord and tenant existed as between the plaintiff and defendants No. 1, then the reliefs could not be granted by this Court and the Rent Court or the small Causes Court alone could try that issue Mr. Bajaj has enumerated a number of circumstances which according to him, would reveal that the plaintiff had granted a tenancy to defendant No. 1. Before I consider the oral evidence as well as the documents, I shall refer to authorities which have been cited both by Mr. Bajaj as well as by Mr. Suresh.

41. Mr. Bajaj has firstly relied upon a ruling of the Supreme Court in the case of Associated Hotels in India Ltd. v. R.N. Kapoor, reported in : [1960]1SCR368 wherein Their Lordship were pleased to observe :---

'Under the aforesaid section (section 52 of the Indian Easements Act), if a document gives only a right to use the property in a particular way or under certain terms while it remains in possession and control of the owner thereof, it will be a licensee. The legal possession, therefore, continues to be with the owner of the property, but the licensee is permitted to make use of the premises for a particular purpose. But for the permission, his occupation would be unlawful. It does not create in his favour any estate or interest in the property. There is, therefore, clear distinction between the two concepts. The dividing line is clear though sometimes it becomes very thin or even blurred.'

42. The learned Judge then proceeded to enumerate four propositions which could be applied in interpreting a document---whether the same was an agreement of lease or of licence. The learned Judge observed :---

'The following propositions may, therefore, be taken as well established:

(1) To ascertain whether a document creates a licence or lease, the substance of the document must be preferred to the form;

(2) the real test is the intention of the parties--- whether they intended to create a lease or licence;

(3) if the document creates an interest in the property, it is a lease; but, if it only permits another to make use of the property, of which the legal possession continues with the owner, it is a licence; and

(4) if under the document a party gets exclusive possession of the property, 'prima facie', he is considered to be a tenant; but circumstances may be established which negative the intention to create a lease.'

43. The tests laid down by the learned Judges in Associated Hotels of India Ltd. v. R.N. Kapoor : [1960]1SCR368 were reiterated in a later decision by the Supreme Court in the case of Lakhi Ram Ram Das v. M/s. Vidyat Cable and Rubber Industry, Bombay, reported in 1970. All India Rent Control Journal, at page 40.

44. Mr. Bajaj next relied upon a decision of a Division Bench of this Court in the case of Sohanlal Naraindas v. Laxmidas Raghunath Gadit, reported in 68 Bom.L.R. 400, wherein Their Lordships were pleased to observed :---

'It is, therefore, of primary importance in construing the terms of a transfer as to whether the parties intended that the transferee should get exclusive possession of the immovable property in question. The intention of the parties is also relevant in deciding whether the other conditions of the lease have been fulfilled. This is particularly so in deciding whether the transfer was for a valuable consideration. Even where exclusive possession of immoveable property was transferred for a certain period, the transaction might amount to a licence and not a lease where the dominant consideration was not the price which the transfers was to pay for the use and enjoyment of the property. ........... Exclusive possession of immovable property for a specified period may also be granted to a person out of sympathy and not in consideration of the price that might be paid by him and in such cases also the transfer may amount to a license and not a lease. Thus, in our view, the intention of the parties which is relevant in deciding whether the transaction is a lease or a license is their intention with regard to the elements which in law constitute a lease or license and not their intention with regard to whether their transaction should be regarded as a lease or a license. It is only where the terms of a transaction are capable of being construed as the terms of a lease as well as those of a license that the assertion of the parties that they intend to create a lease or a license, as the case may be, would be a material consideration.'

45. It may be pointed out that the above decision is Sohanlal v. Laxmidas, 68 Bom.L.R. 400 was impugned before the Supreme Court and the Supreme Court has confirmed the judgment and observations of the High Court in that case. In Sohanlal Naraindas v. Laxmidas Raghunath Gadit, reported in 74 Bom.L.R. 144, Their Lordship of the Supreme Court were pleased to observe :---

'Intention of the parties to an instrument must be gathered from the term of the agreement examined in the light of the surrounding circumstances. The description given by the parties may be evidence of the intention but is not decisive. Mere use of the words appropriate to the creation of a lease will not preclude the agreement operating as a license. A recital that the agreement does not create a tenancy is also not decisive. The crucial test in each case is whether the instrument is intended to create or not create an interest in the property the subject matter of the agreement. If it is in fact intended to create an interest in the property it is a lease. If it does not, it is a license. In determining whether the agreement creates a lease or a licence the test of exclusive possession, though not decisive, is of significance.'

46. Finally, Mr. Bajaj cited before me the observations of a Division Bench of this Court in the case of Miss Aninha D'Costa v. Mrs. Parvatibai Thakur, reported in 67 Bom.L.R. 452 wherein Their Lordships observed :---

'In the present case, there are many circumstances connected with the transaction that have to be considered. The plaintiff had inserted an advertisement in the newspaper that a licence was intended to be granted; but then it is hardly likely that a person who wants to circumvent the provisions of the Rent Act would say that the property is to be leased. The giving of the advertisement, in our view, would indicate that she wanted to give out the property to whomsoever was prepared to take it and pay the price. Merely from the language employed in the advertisement, it cannot be inferred that a licence was inferred. The second circumstance which emerges from the evidence is that admittedly the services of a broker were employed by the plaintiff. It is obvious, therefore; that the intention was not to accommodate any person who was known to the plaintiff, but to have anyone who was needy enough to agree per force to the terms proposed by the plaintiff. The employment of the broker must necessarily suggest that the intention was to earn whatever could be earned out of the property and no other. The amount paid to the broker is also not less. This circumstance, also therefore, cannot support the inference that it was because the plaintiff intended to give a licence only that she had employed the broker. A fair reading of the agreement between the parties leaves no room for doubt that the flat was given in the exclusive possession of the defendant for the use of herself and the members of her family and its use was intended to be for 11 months. The parties however, did intend that the term was renewable at the end of 11 months at the option of the licensee. It was, therefore, not a short term accommodation.........

Indeed, the rest of the terms are such as are to be found in most tenancy agreements, if only difference being that instead of rent the occupational charges are described as compensation.'

47. Mr. Bajaj has laid considerable stress and emphasis on the observations made by the learned Judges in the case cited above and has submitted that the facts in that case stood four square with the facts in the present case.

48. Mr. Suresh has submitted that the Court should not look at the agreement of leave and licence dated 14th June, 1961 at all since the defendants had failed to prove the averments made in paragraphs 6 and 8 of the written statement. According to Mr. Suresh, the averments made in the written statements were either false or had not been proved by the defendants. In these circumstances, according to Mr. Suresh, the Court should not look at the agreement of leave and licence. The facts stated in paragraphs 6 and 8 of the written statement have been recited by me heretofore and it is not necessary to recite them here again. However, I must say that this approach of Mr. Suresh to the issue can only be described as a novel approach with regard to the intention of the parties. I fail to see what the averments made by a party in the written statement filed in 1979 have to do with the interpretation of an agreement which was executed in 1961.

49. Mr. Suresh also contended that the expression 'surrounding circumstances' appearing in the various authorities cited heretofore were the circumstances which took place immediately prior to the execution of the agreement and not circumstances which took place subsequent thereto. This submission also I am unable to accept. The expression 'surrounding circumstances' would include circumstances which took place prior to the agreement as also the circumstances which took place subsequent thereto. Mr. Suresh, however, is justified in saying that circumstances which took place a decade after the execution of the agreement should not be termed as 'surrounding circumstances'. Mr. Suresh has cited certain authorities to show how the intention of the parties has to be ascertained and I shall briefly refer to them.

50. In Halsbury's Laws of England, Fourth Edition, volume 12 at page 593 the learned author has commented thus :---

'The intention must be gathered from the written instrument read in the light of such extrinsic evidence as is admissible for the purpose of construction. The function of the Court is to ascertain what the parties meant by the words which they have used; to declare the meaning of what is written in the instrument, not of what was intended to have been written; to give effect to the intention as expressed, the expressed meaning being, for the purpose of interpretation, equivalent to the intention. It is not permissible to guess at the intention of the parties and substitute the presumed for the expressed intention. It, however, in any particular respect, the intention is clear on the whole instrument, effect will be given to that intention, even though it is not stated in express words.'

51. Mr. Suresh also relied upon certain observations made in the same volume at page 622, para 1490, where the learned author has observed :---

'The Court, which has to construe the document, ought to know the surrounding circumstances at the time when it was executed, so as to place itself, as nearly as possible, in the position of the parties. The intention of the parties is expressed in the words, used as they were with regards to the particular circumstances and facts.'

52. Mr. Suresh next relied upon an English ruling in the case of Somma v. Hazlehurst and another, of the Court of Appeal, Civil Division, reported in (1978)2 All E L R 1011, wherein Their Lordship were pleased to observe :---

'There seem to us to be two questions which we have to answer (1) Did the parties intend to be bound by the written agreements (2) can it be said from the words which they used in those agreement that they intended to create a tenancy rather than a licence ?'

52-A. Mr. Suresh relied upon an unreported judgment of a Division Bench of this Court in Appeal No. 102 of 1978, Suit No. 842 of 1972 Vasudeo Mirchumal Devjani v. Hindustan Chemical works Ltd., delivered by Chandurkar, Ag. C.J. and Rege, J., on 31st August, 1983. Their Lordships observed :---

'The question as to whether the transaction is a lease or a licence has to be decided on the facts in each case and in the light of the recitals in the relevant agreement evidencing the transaction. There is no set formula in which a case has to be fitted. The facts of no two cases can be identical and, therefore, while guidance may be available from decided cases in so far as the test to be applied is concerned, merely because on facts of a reported case an inference of lease has been drawn, it will not be proper to draw the same inference on so called similar facts because there are bound to be distinguishing features in each case as brought out in the oral and documentary evidence.'

52-B. Mr. Suresh also relied upon the observation of the Supreme Court in the case of Qudrat Ullah v. Bareilly Municipality : [1974]2SCR530 , of the following effect :---

'There is no simple litmus test to distinguish a lease as defined in section 105. Transfer of Property Act from a licence as defined in section 52, Easements Act, but the character of the transaction turns on the operative intent of the parties. To put it pithily, if an interest in immovable property, entitling the transferees to enjoyment, is created, it is a lease; if permission to use land without right to exclusive possession is alone granted, a licence is the legal result.'

53. Now, it will be relevant to consider the evidence of defendant No. 1 since it was he who had negotiated the transaction with Gagrat and Ram Dadlani. Tulsidas Chogumal Chhabria, defendant No. 1, stated in his evidence that in 1961 he came across an advertisement in the Times of India stating that a vacant flat was to be given on rent. He, therefore, phone Mr. Ram Dadlani that he was in need of a flat for his mother, father, brother and sister. Dadlani showed him the suit flat on Peddar Road. Defendant No. 1 stated that after his parents had approved of the flat, they decided to occupy it. Dadlani told him that he would have to pay a deposit of three month's rent and pay Rs. 400/- per month as rent. Dadlani told defendant No. 1 that he would take defendant No. 1 to Rustom Gagrat who held charge of the flat. Dadlani also told him that he would have to pay three month's rent as his brokerage. Dadlani also told defendant No. 1 that if Gagrat approved of the transaction, he would hand over possession of the flat immediately and the agreement would be entered into latter. Defendant No. 1 stated that when he met Gagrat, he told Gagrat that he required the flat for his parents, brothers and sister. Gagrat approved of the transaction and gave possession of the flat to him. Defendant No. 1 stated that thereafter his whole family, consisting of his wife, two children, parents, brother and sister then moved into the flat. Defendant No. 1 stated that Gagrat assured him of peaceful possession of the flat so long as he paid the rent. Gagrat stated that the his nephew had no intention of coming to Bombay and staying here.

54. Defendant No. 1 stated that he along with his wife and two children moved out of the suit flat in 1965 and his parents, brothers, sister and their families continued to reside there.

55. Defendant No. 1 then stated that Gagrat agreed to give him possession of the suit flat even before the agreement was signed as Gagrat felt that he, defendant No. 1, was a good party. Defendant No. 1 then stated that his brother Naraindas, defendant No. 3 was married in the year 1962. His brother Chaturbhuj defendant No. 4, was married in the year 1965, the year in which he moved out of the flat. The amount of compensation for the suit flat was paid by cheque either by him on his father or any one of his brothers.

56. Defendant No. 1 then stated that his mother expired sometime in the year 1980. He had always intended to purposes the suit flat as his family conducted business in Bombay and was settled in Bombay since the time of his grandfather. Defendant No. 1 then stated that he told Rustom Gagrat that he would require the flat for long period and Gagrat assured him that he could have the flat for as long a period as defendant No. 1 liked provided defendant No. 1 paid the compensation. Gagrat stated to him that his cousin, the plaintiff, would not be returning to Bombay for a long time. Prior to 1971 the plaintiff did not show any desire to have possession of the flat. Defendant No. 1 stated that between 1961 and 1971 he had met the plaintiff. Defendant No. 1 stated that in 1965 he shifted from the building 'Miramar' at Napean Sea Road to a building known as 'Poornima Apartments' at Paddar Road, Bombay. In 1981 he shifted from Poornima Apartments to Santacruz.

57. Now, the circumstances on which Mr. Bajaj has relied, in order to show that the transaction between the parties was one of lease and not of licence, are, firstly, that defendant No. 1 and Gagrat were total strange's to one another prior to the transaction. Secondly, that the services of the estate broker Ram Dadlani had been. Utilised and defendant No. 1 had to pay brokerage of the estate broker. Thirdly, that an advertisement had been inserted in the columns of the Times of India to the effect that the suit flat was to be given on licence. Mr. Bajaj stated that it was in response to this advertisement that defendant No. 1 approached Ram Dadlani, who, in turn, took defendant No. 1 to the office of Gagrat. Mr. Bajaj has also submitted that the intention of the plaintiff was to make a profit out of the suit flat. Mr. Bajaj has relied upon the evidence given by the plaintiff wherein he has stated that between 1963 and 1966 the maintenance and other outgoings of the society came to about Rs. 155/- per month and from 1973 onwards the maintenance and other outgoings came to about Rs. 342/- per month. Mr. Bajaj argued on the basis of this evidence that the plaintiff wanted to make a net profit of Rs. 250/- per month on an investment of Rs. 27,000/- which was the purchase price of the flat. Mr. Bajaj contended that although presently the outgoings were Rs. 342/- per month and the plaintiff was not in a position to make considerable profit, from 1961 to 1966 at least the plaintiff stood to gain to the extent of Rs. 250/- per month. I am unable to appreciate this argument of Mr. Bajaj. It is obvious that the three or four circumstances which he has pointed out are similar to the circumstances which prevailed in the case of Aninha D'Costa, (67 Bom.L.R. 452). However, the profit of Rs. 250/- per month on an investment of Rs. 27,000/- would come to about 12% or so and this, I do not think can be termed as an exorbitant compensation.

58. Mr. Bajaj then submitted that the defendants were in exclusive possession of the suit flat, a fact which is not in dispute in this suit. Mr. Bajaj contended that exclusive possession would be conclusive evidence of a lease and not of licence. It is correct that in Sohanlal's case 68 Bom.L.R. 400 Their Lordship held that the right to exclusive possession of immovable property would be prima facie evidence of an agreement of lease. However, the learned Judges held that there may be surrounding circumstances which may negative this presumption. The same proposition was given expression to by Denning L.J., in Errington v. Errington, reported in 1952(1) K.B. 290, when he observed :---

'The result of all these cases that, although a person who is let into exclusive possession is prima facie to be considered to be tenant, nevertheless he will not be held to be so if the circumstances negative any intention to create a tenancy. Words alone may not suffice. Parties cannot turn a tenancy into a licence merely by calling it one. But if the circumstances and the conduct of the parties show that all that was intended was that the occupier should be granted a personal privilege with no interest in the land, he will be held only to be a licensee.'

59. The question of paramount importance in considering whether an agreement is an agreement of lease or of licence is the intention of the parties and that intention can best be gauged from the agreement which was arrived at between the parties at about the time the transaction was negotiated. It will, therefore, be necessary to consider the various clauses of the agreement dated 14th June, 1961.

60. Mr. Bajaj has contended that there are various clauses in this agreement which could be found only in an agreement of lease and not of a licence, and I agree with his submission. I find on a reading of the various clauses of the agreement that there are several clauses which could only indicate that what was granted to the first defendant by the plaintiff under the agreement was a lease and not a licence. The agreement commences with the recital clause which is in the following terms :---

'THIS AGREEMENT MADE BETWEEN Hormazd Kaikhushroo Sethna the only heir and next of kin of Mrs. Roshan Kaikhushroo Sethna and her legal representative hereinafter called 'the licensor' (which expression shall unless it be repugnant to the context or meaning thereof include his heirs, executors, administrators and assigns) of the one part and Tulsidas Chogumal Chabria hereinafter called ' the licensee ' (which expression shall unless it be repugnant to the context or meaning thereof be deemed to include his heirs, executors and administrators) of the other part......'

Mr. Bajaj has rightly commented that a licence was a permission which was personal to the grantee and if that was so, then the expression 'licensee' could not include the heirs, executors and administrators. It cannot be argued that this expression had been included through some inadvertence or oversight, for the reason that the expression ' licensor' included heirs, executors, administrators and assigns. The word 'assigns' has been deleted while defining the expression ' licensee'. It will be relevant at this stage to refer to the definition of the word 'license' contained in section 52 of the Indian Easements Act, 1882, which is in the following terms :---

'Where one person grants to another, or to a definite number of other persons, a right to do, or continue to do, in or upon the immovable property of the grantor, something which would, in the absence of such right, be unlawful, and such right does not amount to an easement or an interest in the property, the right is called a license.'

Section 105 of the Transfer of Property Act defines a lease in the following terms:---

'A lease of immovable property is a transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms.'

Mr. Bajaj is, therefore, justified in his submission that if the licence was something personal to the grantee, then the licence would come to an end no sooner the licensee died. The fact that the expression 'licensee' has been defined in the recital of the agreement to include his heirs, executors and administrators would mean that the licence would also pass, on the death of the licensee, to his heirs and legal representatives.

61. Mr. Bajaj has then drawn my attention to Clause 5 of the agreement which provided, inter alia, that the licensee shall repair and color wash the promises and make good any damage or loss at his expense. Mr. Bajaj submitted that by this clause the licensees i.e. the defendants were saddled with the liability of carrying out the repairs and color wash the premises and that would indicate that an interest was created in the defendants. I am, however, not impressed with this submission. The mere fact that the liability for carrying out the repairs was thrown on the shoulders of the defendants cannot by itself mean that an interest in the property was created.

62. Mr. Bajaj then drew my attention to the provisions of Clause 6 of the agreement which provided that the licensee would have no exclusive right to the use and occupation of the said flat. According to Mr. Bajaj, there was no controversy between the parties that the suit flat had remained in the exclusive possession of the defendants from the date of the agreement i.e. from 1961 right till the date when the suit was filed in 1973 and even presently, according to Mr. Bajaj, this clause would indicate that the provisions thereof were not to be acted upon. Now, as I have pointed out there is no controversy that the suit flat has remained in the exclusive possession of the defendants. It may be pointed out here that under Clause 6, it is also provided that nothing stated in the agreement would constitute a tenancy or sub-tenancy between the licensor and the licensee and that the express intention of the parties was that this i.e. the agreement was a licence. The consensus of authorities is that even though there be an express provision like the one contained in Clause 6, that by itself will not determine whether an agreement is of lease or of licence.

63. Mr. Bajaj has then drawn my attention to the provisions of Clause 7 which provided that the licensee would not be permitted to sub-let, underlet or part with possession of the suit flat or any part thereof or keep any paying guest or licensee with him during the continuance of the licence. Mr. Bajaj has stressed the words 'sub-let or under-let' in this clause and has submitted that the intention of the parties was to create a tenancy and hence the expression 'sub-let or under-let' has been used. Mr. Bajaj stated that the licensee could not under any circumstance create a sub-tenancy. I agree with Mr. Bajaj that this clause would indicate that the intention of the parties was to create a lease and not a licence.

64. Mr. Bajaj next has drawn my attention to the provisions of Clause 10 which provided :---

'This licence shall be irrevocable on the part of the licensor for the period commencing from the 1st day of June, 1961 to the 31st day of May, 1964 but it shall be open to the licensee to terminate this agreement by giving to the licensor three calendar month's notice in writing by registered post in which event this agreement shall stand terminated.'

Mr. Bajaj has argued that during the period of the licence i.e. for a period of three years the licence was irrevocable, although the clause provided for the licensee to terminate the licence after giving three month's notice to the licensor. Mr. Bajaj contended that the fact that the licence was made irrevocable during the period of the agreement gave indication of the intention of the parties to create a lease and not a mere licence. I agree that this clause read with the provisions of Clause 16, which I shall refer to presently, conclusively indicates that the intention of the parties was to create a lease and not a licence.

65. I shall now refer to Clause 16 of the agreement and shall set out the entire clause :---

'This Licensor agree that he will during the period of the licence pay the taxes and contributions payable by him as owner of the said flat to the owners of the building and shall not do or suffer anything to be done whereby he shall cease to be the owner of the said flat or whereby the use and occupation of the said Flat by licensee is disturbed or affected in any way.' (Underlining supplied).

Under this clause, the licensor i.e. the plaintiff bound himself not to cease to be the owner of the said flat i.e. not to sell the same or to do any other similar act whereby the use and occupation of the said that by the licensee i.e. the 1st defendant was disturbed or affected in any way. This clause, therefore, created a certain interest in the property for the defendants. This clause under which the plaintiff had agreed not to do or suffer anything to be done whereby he would cease to be the owner or whereby the use and occupation of the suit flat by the licensee was disturbed, read along with the provisions of Clause 10 under which the licence was irrevocable at least for the period of the licence, would indicate that an interest in the property had been created in favour of defendant No. 1 and would further indicate that the intention of the parties was to create a lease and not a licence.

66. The clauses mentioned above would, therefore, indicate that the agreement dated 14th June, 1961 was an agreement of lease which, to borrow the expression of Cumming-Bruce, L.J. 1978(2) All.E.R. 1011, masqueraded under the nomenclature of licence. The other circumstance i.e. exclusive possession granted to the defendants would further go to reinforce that contention.

67. There is one more circumstance which has to be taken into consideration and that is the fact that the compensation or rent remained constant from 1961 to 1973 when the suit was filed, and even till today. If the plaintiff had granted a licence, then one would have expected that he would have demanded an increase in the amount of compensation or licence fee, especially with the rise in the maintenance charges and outgoings. The fact that no demand for an increase in the licence fee was made would also be an added indication of the fact that the amount was by way of rent and not compensation. This circumstance, by itself, may not be a decisive factor in the interpretation of an agreement-whether the same was an agreement of leave and licence. However, this is a factor which is indicative of the intention of the parties. I am, therefore, of the view that the agreement contains several clauses which one would find in an agreement of lease and not of licence, and the various clauses which I have pointed out above would indicate that the intention of the parties was to create a lease rather than a licence. The two circumstances which I have pointed out above i.e. exclusive possession and the constant and invariable amount of the licence fee would also go to corroborate that conclusion.

68. There is one more circumstance to which I must advert while considering the surrounding circumstance and that is the fact that although the agreement expired in June 1964, the defendants were permitted to remain in the suit premises undisturbed till 11th October, 1972 on which date the licence was terminated by letter of the plaintiff's attorneys of the same date. It is true that the plaintiff has deposed that in 1969 he had personally met defendant No. 1 and requested him to vacate the premises, but defendant No. 1 had refused to do so. It is true that this interview was not recorded in writing. But there is no reason to disbelieve the plaintiff because he has stated that in 1969 his services were terminated and he came down to Bombay from Calcutta and was in some premises. It would be natural, therefore, for him to try and recover his own premises which had been given on licence to the defendants. Taking this evidence to be true, even so the defendants were in use and occupation of the suit flat till 1969 i.e. for a period of nine years. This fact also would be one more indication of the intention of the parties.

69. I must, therefore, answer Issue No. 3 in the negative and Issue No. 8 in the affirmative.

70. At this stage, I may also deal with a submission of Mr. Bajaj that the agreement was made solely with a view to circumvent the provisions of the Rent Act and that also would be an indication of the fact that the agreement was an agreement of lease and not of licence. Mr. Bajaj has relied upon the evidence of Gagrat, where in cross-examination Gagrat admitted that the agreement of leave and licence was entered into with a view to remove it from the purview of the Rent Act as it then stood. Mr. Bajaj stated that Patel, J., in the case of Aninha D'Costa v. Parvatibai, 67 Bom.L.R. 452 had deprecated such an attempt when he stated :---

'Why then one must construe the agreement between the parties as a licence and allow the evasion of the Rent Act merely because the plaintiff has chosen to apply the label that it is a licence.'

Mr. Bajaj contended that I should take the same view which Patel, J., did in the case mentioned heretofore and that I should also deride the attempt on the part of the plaintiff to evade the provisions of the Rent Act. It is difficult to accept the submission of Mr. Bajaj for the reason that the motivations in Aninha D'Costa's case and that in the instant case are completely different. In Aninha D'Costa's case the defendant attempted to circumvent the provisions of the Rent Act in order that she could charge exorbitant rate of compensation which would not be permitted under the Rent Act, for then she would have to charge only the standard rent. In the instant case, that certainly was not the motive of the plaintiff. I have already stated that the intention of the plaintiff in allowing the defendants to use the suit flat was not to profiteer. As Gagrat himself has explained in his evidence, the intention was to circumvent the provisions of the Rent Act, in so far as the creation of a sub-tenancy was not permitted. I must, therefore, reject this submission of Mr. Bajaj.

71. Issue No. 7 : Issue No. 7 is whether the defendants provided that the agreement dated 14th June, 1961 is a colourable and sham document entered into for the purpose of avoiding the provisions of the Bombay Rent Act, as stated in paragraph 8 of the written statement. Since I have held that the agreement dated 14th June, 1961 is an agreement of lease and not an agreement of leave and licence, I must come to the conclusion that the agreement which has been termed as an agreement of licence, is a sham and colourable document. I must, therefore, answer this issue in the affirmative.

72. Issue Nos. 4 and 5 : Issue No. 4 is whether the said licence stood terminated or revoked as stated in paragraph 8 of the plaint and Issue No. 5 is whether the defendants are trespassers. It is true that the plaintiff by his attorney's letter dated 20th November, 1972 had terminated the licence of the defendants 21 days after the date of that letter. However, since I have held that the agreement is one of lease, that letter cannot affect the rights of the defendant who are tenants of the suit premises. I must, therefore, answer Issue No. 4 in the negative. I must also answer Issue No. 5 in the negative for the same reason.

73. Issue No. 2 : I shall now address myself to Issue No. 2 which is whether the suit is not properly valued for the purpose of Court-fees as alleged in paragraph 4 of the written statement. This issue has not been pressed by Mr. Bajaj.

74. Issue No. 6 : Issue No. 6 is whether the defendants proved that the agreement dated 14th June, 1961 was entered into between the plaintiff and defendant No. 1 for himself and for and on behalf of the other defendants as stated in paragraph 6 of the written statement. In paragraph 7 of the plaint, the plaintiff stated that in 1972 he came to know that defendant No. 1 along with his family had vacated the suit flat and had parted with possession of the said flat and had put his mother and brothers in possession of the flat which had been given to defendant No. 1 on licence for personal use for himself and his family. Thus, according to the plaintiff, defendant No. 1 had committed a breach of the agreement of leave and licence and that was one of the grounds on which the licence was terminated by the plaintiff's Attorney's letter 11th October, 1972.

75. In paragraph 6 of the written statement the defendants stated that the plaintiff was aware of the fact that the premises were required for defendant No. 1 and his family members consisting of his mother, brothers etc. who were staying together. The defendants stated that they had informed the plaintiff that the agreement would be entered into between the plaintiff and defendant No. 1 who would be executing the document both for himself and for and on behalf of the other members of his family including his mother and brothers. The defendants stated that from the inception the plaintiff was aware of the agreement that defendant No. 1 intended to stay along with his mother, brothers and other members of his family.

76. Considerable energy has been expended by Mr. Bajaj in proving the fact that the original defendant No. 2 and defendants No. 3 and 4 started residing in the suit flat right from 1961 when the agreement was entered into. An equal amount of energy was expended by Mr. Suresh in disproving this fact and in trying to prove that defendant No. 1's mother i.e. original defendant No. 2 and his two brothers i.e. defendants Nos. 3 and 4 started residing in the suit flat only from 1965 after defendant No. 1 left the suit premises and went to stay at 'Miramar.' Various witnesses have been examined on behalf of the defendants in order to establish their case. However, before, I deal with the evidence, I may point out that in Clause 5 of the agreement it has been provided that the licenses i.e. defendant No. 1 would 'use the flat for personal use of himself and members of his family and for no other purpose.' Now, the agreement does not make it clear that the members of the family would include only the wife and children of defendant No. 1 the expression 'members of the family' is a comprehensive expression which could also include defendant No. 1's mother and brothers, who were his close relatives. It is correct that Gagrat has stated in his evidence that he questioned defendant No. 1 as to who were the members of his family and defendant No. 1 stated that his family consisted of his wife and two children. However, I cannot go by the oral evidence given by a witness when the terms of the agreement are very clear. Indeed such evidence would be inadmissible under the Evidence Act. I am, therefore, of the view that under the agreement defendant No. 1 was permitted to make use of the suit premises for himself and members of his family, which could well include his mother and brothers. The provisions of Clause 5 of the agreement would answer the issue. However, I shall briefly refer to the evidence which has been adduced on behalf of the defendants.

77. The defendants examined Prakashchandra Bishansarup Agarwal (D.W. 5), Smt. Jaswantkaur Kuldeepsingh Nanda (D.W. 6) and Smt. Phularani Charanjitlal Sahegal (D.W. 7), who are all three residents of the building 'Vasant ' in which the suit premises are situated . All three of them stated that they knew defendant No. 1 and members of his family who had been residing in the flat from sometime around 1961. In cross-examination all three of them have admitted that the evidence which they gave was given from memory. I am , therefore, not inclined to place much reliance upon the evidence of these witnesses, particularly in view of the fact that certain incontrovertible documentary evidence has been produced by the defendants in support of the issue.

78. The defendants examined one Hiranand Lilaram Chablani, D.W. 3, who is the Deputy General Manager of the National Sports Club of India. Chablani has produced certain records of the National Sports Club of India, more particularly the application form of defendant No. 4, which has been marked as Ex. No. 4. The date appearing on the application from is 28th June, 1963 and the address of the candidate has been shown as 2-A, Vasant Building, Peddar Road, Bombay 26, which is the address of the suit flat .

79. Mr. Suresh made some attempt to show that this application form, Ex. No. 4 was a fabricated document, and that this application form was replaced by the original application form which bore a later date. There is no evidence or any circumstance which could support the contention of Mr. Suresh and on the face of it this application from appears to be a genuine application form of defendant No. 4 for membership of the N.S.C.I. However, the matter is clinched by the production by the same witness Chablani of the ledger of Members of the N.S.C.I. commencing from October 1962. This ledger contains the account of defendant No. 4 commencing from August 1963 . I have perused the Register and the Register appears to have been maintained in the ordinary course of the Clubs business. There appears to be no interpolation or any cancellation in the ledger and this ledger together with the application form for entrance to the Club, which bears the address of the suit flat, would conclusively show that defendant No. 4 was residing in the suit flat from at least 1963. This evidence would, therefore, show that defendant No. 4 was residing in the suit flat from the year 1963 i.e. much prior to defendant No. 1 abandoning the suit flat. Both defendants Nos. 1 and 4 have deposed in their evidence that from the commencement of the agreement defendant No. 1 resided in the suit flat along with his mother and brothers i.e. defendants Nos. 3 and 4. There appears to be no reason for disbelieving their evidence supported as it is by the evidence which I have discussed heretofore. I must, therefore, answer Issue No. 6 in the affirmative.

80. Issues Nos. 9 and 10 :---That brings me to the last two issues. Issue No. 9 is whether the plaintiff is entitled to recover Rs. 6530/- towards compensation or damages as per the particulars of Exhibit 'D' to the plaint and Issue No. 10 is whether the plaintiff is entitled to mesne profits or compensation and if so, at what rate The amount of Rs. 6530/- has been calculated on the basis of mesne profits or damages at the rate of Rs. 30/- per day. No damages or mesne profits at the rate mentioned can be awarded, for the reason that the defendants have succeeded in proving that they were lessees of the suit flat. The plaintiff, however, would be entitled to recover from the defendants at the rate of Rs. 400/- per month as provided in the agreement dated 14th June, 1961. The answer to Issues Nos. 9 and 10 will, therefore be in the negative.

81. My answers to the Issues are :---

Issue No. 1 ... ..... In the negative This Court has jurisdiction to try the suit.Issue No. 2 .... ..... Not pressed.Issue No. 3 .... ..... In the negative.Issue No. 4 .... ..... In the negative.Issue No. 5 .... ..... In the negative.Issue No. 6 .... ..... In the affirmative.Issue No. 7 .... ..... In the affirmative.Issue No. 8 .... ..... In the affirmative.Issue No. 9 .... ..... In the negative.Issue No. 10 .... ..... In the negative.Issue No. 11 .... ..... As per order.

82. In the result, the suit stands dismissed.

Mr. Shah on behalf of the plaintiff submits that no costs be awarded to the defendants in view of the fact that the defendants have been in possession of the suit flat for the meagre amount of Rs. 400/- per month for the last almost twenty years. Mr. Bajaj leaves the matter to the Court.

It is true that the defendants have been residing in a flat which is situated in a locality which is considered to be one of the most elite areas in the City on a meagre compensation of Rs. 400/- per month which barely covers the maintenance and outgoing charges. In view of this, I order that each party will bear its own costs.


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