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Ananthasubramaniam Jagadesan Vs. T.V. Parwani - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtMumbai High Court
Decided On
Case NumberWrit Petition No. 250 of 1982
Judge
Reported in1983(2)BomCR580
ActsBombay Rents, Hotel and Lodging House Rates Control Act, 1947 - Sections 41; Transfer of Property Act, 1882 - Sections 105; Easements Act, 1882 - Sections 52
AppellantAnanthasubramaniam Jagadesan
RespondentT.V. Parwani
Appellant AdvocateA.V. Sawant, Adv. General and ;R.M. Purandare and ;R.N. Dhorde, Advs.
Respondent AdvocateN.H. Gurusahani, ;Narendra and ;Walavelkar, Advs.
Excerpt:
property - nature of document - section 41 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 - whether document styled as license deed was in fact lease deed - license confers right to do something upon immovable property of grantor which for grant of right may be unlawful but it creates no estate or interest in immovable property of grantor - lease on other hand creates interest in property demised - intention of parties to an instrument must be gathered from terms of agreement examined in light of surrounding circumstances - description given by parties may be evidence of intention but is not decisive - mere use of words appropriate to creation of lease not preclude agreement operating as.....s.p. kurdukar, j.1. the dispute in this petition relates to a room situated on the 5th floor, bearing room no. 507 in commerce house, medows street, fort bombay. it is needless to say that the premises in dispute are situated in the heart of city as well as business locality. it is no more in dispute that the petitioner is the tenant member of the association of the commerce house block owners limited and he has purchased the suit premises sometime in the year 1958 for rs. 13,000/-. the area of this suit premises is about 300 sq. ft.2. the main question that falls for consideration in this petition relates to the construction of document dated june 1, 1964 which is titled as leave and license agreement-hereinafter referred to as 'the document'. it is also common ground that the respondent.....
Judgment:

S.P. Kurdukar, J.

1. The dispute in this petition relates to a room situated on the 5th floor, bearing Room No. 507 in Commerce House, Medows Street, Fort Bombay. It is needless to say that the premises in dispute are situated in the heart of city as well as business locality. It is no more in dispute that the petitioner is the tenant member of the Association of the Commerce House Block Owners Limited and he has purchased the suit premises sometime in the year 1958 for Rs. 13,000/-. The area of this suit premises is about 300 sq. ft.

2. The main question that falls for consideration in this petition relates to the construction of document dated June 1, 1964 which is titled as Leave and License Agreement-hereinafter referred to as 'the document'. It is also common ground that the respondent was put in possession of the suit premises first time under the said document. The license fee charged for the use and occupation of the suit premises is Rs. 550/- per month. According to the petitioner the document dated June 1, 1964 is an agreement of leave and license simple, whereas according to the respondent the said document was camouflaged as a license, and the parties never intended to act upon it and the real intention between the parties was to have the relationship of landlord and tenant. The petitioner revoked the license by his notice dated May, 15, 1965 and called upon the respondent to hand over the peaceful and vacant possession of the suit premises. Since the respondent failed to comply with the said notice sometime in March, 1966, the petitioner made an application under section 41 of the Presidency Small Causes Act, 1882 (Act XV of 1982) hereinafter called 'the Act' for possession of the suit premises. The said application is annexed to this petition at page 30.

3. It is the case of the petitioners that under the document dated June 1, 1964, the respondent was put in possession as the licensee for the period of 11 months and said period expired on April, 30, 1965. The petitioner did not renew the leave and license agreement. The license came to be revoked by notice dated May 15, 1965, and therefore, he is entitled for possession of the suit premises.

4. The respondent contested this application on several amongst other grounds. The points of defence are annexed to this petition at page 31. The respondent denied that he is a licensee. He contended that he is a tenant of the applicant of the suit premises and thus protected under the provisions of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947- hereinafter called 'the Bombay Rent Act'. Since he is tenant this Court has no jurisdiction to grant any relief to the petitioner under section 41 of the Act. Several other contentions were also raised in the points of defence but for the purpose of disposal of this petition it is not necessary to refer to several other allegations.

5. As required under section 41 of the Act, the learned trial Judge framed a preliminary issue as to whether the respondent is a licensee or a tenant of the applicant protected under the Bombay Rent Act. This issue was tried as a preliminary issue and both the parties led oral and documentary evidence in support of their rival contentions. The learned trial Judge by his order dated July 23, 1970 in S.A. No. 57/324 of 1966 answered the preliminary issue holding that the respondent is not a licensee of the applicant of the suit premises but he is the tenant of the applicant of the suit premises. After answering the said issue the application came to be adjourned for further order to August 28, 1970.

6. Aggrieved by this order, the petitioner preferred Appeal No. 469 of 1970 to the Appellate Bench of the Court of Small Causes at Bombay and learned Judges after considering the rival contentions and also after reappraisal of the material on the record by their order dated September 11, 1981 dismissed the appeal and confirmed the finding on the preliminary issue recorded by the trial Judge.

7. It is against these concurrent findings, the petitioner has approached this Court under Article 227 of the Constitution of India.

8. As stated the only question that has to be considered in this writ petition is as to whether the document dated June 1, 1964 though styled as a license deed was in fact a lease deed and whether the parties intended to create the relationship of the landlord and tenant and in the pursuance of which possession of the suit premises was given to the respondent. Shri A.V. Savant learned Advocate General, appearing in support of this petition attacked the impugned judgment on several grounds. Firstly, he submitted that both the courts below proceeded on the assumption that the document in question is a camouflage and on this assumption the courts below appreciated the evidence on the record. According to Shri Sawant by reason of this process of thinking both the judgments are vitiated. According to Shri Sawant various terms contained in the document of license dated June 1, 1964 do not warrant any inference or finding that the said document is a camouflage and entered into in order to circumvent the provisions of the Bombay Rent Act. Shri Sawant relied upon several circumstances and the conditions contained in the document and submitted that the findings of both the courts below are illegal, perverse and contrary to law. In order to supplement this argument he submitted that the agreement dated June 1, 1964 must be taken as indicating the true transaction between the parties. (2) If document recited leave and license the burden is on a person who wants to call it lease otherwise than expressed in the said documents; (3) One of the terms also recites that petitioner granted a personal privilege to the respondent to occupy the suit premises and no interest was created therein; (4) The license was for a limited period i.e. for 11 months and the respondent enjoyed the said privilege for only one tenure; (5) The said document also recites that the possession of the premises was given to the respondent with fixtures, furniture and fittings which admittedly belong to the petitioner; (6) Right of revocation retained by the petitioner and could be exercised at any time; (7) The letter written by the respondent dated March 13, 1965 confirming the same rights flowing under the said document and not claiming the higher rights as tenant; (8) The legal possession was retained by the petitioner and the respondent was not in exclusive possession.

9. Relying upon those circumstances Shri Savant submitted that if these circumstances are considered in the light of the evidence of the record the only irresistible conclusion is that the respondent is a licensee and not a tenant and in that event the said document must be construed to mean a leave and license agreement and upon revocation of the said license the petitioner is entitled to the possession of the suit premises.

10. It is now well-settled that a license confers a right to do or continue to do something in or upon the immovable property of grantor which but for the grant of right may be unlawful but it creates no estate or interest in the immovable property of the grantor. A lease on the other hand created an interest in the property demised. Intention of the parties to an instrument must be gathered from the terms 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 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 an interest in the property on the subject matter of the agreement. If it is in fact intended to create or not 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 license the test of exclusive possession though not decisive, is of significance. See Sohanlal Naraindas v. Laxmidas Raghunath Gadit, 1971 All Indian Rent Control Journal 203.

11. Bearing in mind this well settled principle, I may now proceed to consider the arguments advanced before me in support of this petition. The said document contains in all 15 clauses out of which the first is that the licensee shall not be in exclusive possession of the said office room and that he shall merely have a right to use and occupy the said office room purely on leave and license basis, as the licensee, for the temporary period of 11 months commencing from 1st day of June, 1964. It is well settled that the exclusive possession is not the decisive test but it is an important circumstance to be taken into account for determining as to whether exclusive possession was given to the licensee and whether the said exclusive possession is consistent or inconsistent with the document of leave and license. Shri Savant relying upon this clause submitted that both the courts below have wrongly approached the question in the present case viz. the exclusive possession being the decisive factor ignoring the several other clauses contained in the said document. I do not see any substance in this submission at all. The learned Judges of the courts below were very much conscious of the various decisions of this Court as well as of the Supreme Court which had laid down the various tests in order to determine under what circumstances the document although styled as a leave and license agreement be treated as a transaction of lease. In order to show that the exclusive possession is not the only decisive factor Shri Savant sought to rely upon the passages from Halsbury's Laws of England, Volume 27, Fourth Edition. He specifically drew my attention to paragraphs 6, 7, 8 at pages 13, 15 and 19 which are as follows :

'6. General principles for determining whether agreement creates lease or license :- In determining whether an agreement creates between the parties the relationship of landlord and tenant or merely that of licensor and licensee the decisive consideration is the intention of the parties. The parties to an agreement cannot, however, turn a lease into a license merely by stating that the document is to be deemed a license or describing it as such. The parties relationship is determined by law on a consideration of all relevant positions of the agreement; and an agreement labelled by the parties to it as a 'license' will still be held to create a tenancy if the substance of the agreement conflicts with that label. Similarly, the use of operative words ('let', 'Lessor' etc.), which are appropriate to a lease will not prevent the agreement from conferring only a license. Primarily, the Court is concerned to see whether the parties to the agreement personal in its nature or not, so that the assignability of the grantee's interest, the nature of the land and the grantor's capacity to grant a lease will all be relevant considerations in assessing what is the nature of interest created by the transaction. In the absence of any formal document the parties' intention must be informed from the circumstances and parties' conduct.

7. Nature of grant of exclusive possession :---

The fact that the agreement grants a right of exclusive possession is not in itself conclusive evidence of the existence of a tenancy but it is a consideration of the first importance, although of the lesser significance than the intention of the parties.

In deciding whether a grantee is entitled to exclusive possession, regard must be had to the substance of the agreement. In order to give exclusive possession there need not be express words to that effect, it is sufficient if the nature of the acts to be done by the grantee requires that he should have exclusive possession.

However, the grant of an exclusive right to a benefit can be inferred only from language which is clear and explicit. If an exclusive right of possession is subject to certain reservation or to a restriction of the purpose for which the premises may be used. The reservations or restrictions will not necessarily prevent the grant operating as a lease.

Creation of license.---A license is normally created where a person is granted the right to use premises without becoming entitled to exclusive possession of them, or the circumstances and conduct of the parties show that all that was intended was that grantee should be granted a personal privilege with no interest in the land. If the agreement is merely for use of the property in certain terms while the property remains in the owner's possession and control, the agreement will operate as a license, even though the agreement may employ words appropriate to a lease.'

12. As stated earlier there can be no doubt about the propositions laid down in these paras. Exclusive possession is one of the circumstances, an important circumstance to be taken in to account. In this behalf reliance was placed on behalf of the petitioner on judgment of the Supreme Court in Outdrat Ullah v. Municipal Board. Bareilly : [1974]2SCR530 . Strong reliance was placed on page 7 of the judgment which reads as under :---

'7. There is no simple litmus test to distinguish a lease as defined in section 105, Transfer of Property Act from a license 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 transfers to enjoyment, is created, it is a lease, if permission to use land without right to exclusive possession is alone granted, a license is the legal result Marginal variations to this broad statement are possible and Exs. 'I ' and '4' fall in the gray area of unclear recitals. The law on the point has been stated by this Court in the (Associated Hotels), case : [1960]1SCR368 . In Halsburys' Laws of England, Volume 23, the distinctive flavour, the deceptive labels and the crucial considerations in a lease versus license situation have been stated and excerpts there from may serve as guidelines (see pages 427 and 429) :

'1022. Principles for determining whether Agreement creates lease or license : in determining whether an agreement creates between the parties the relationship of landlord and tenant or merely that of licensor and licensee the decisive consideration is the intention of the parties. The parties to an agreement can not, however, turn a lease into a license merely by stating that the document is to be deemed a license or describing it as such the relationship to the parties is determined by law on a consideration of all relevant provisions of the agreement ; nor will the employment of words appropriate to a lease prevent the agreement from conferring a license only if from the whole document it appears that it was intended merely to confer a license : in the absence of any formal document the intention of the parties must be inferred from the circumstances and the conduct of the parties.

1023. Nature of grant of Exclusive Possession:- The fact that the agreement grants a right of exclusive possession is not in itself conclusive evidence of the existence of a tenancy, but it is a consideration of the first importance.

In deciding whether a grantee is entitled to exclusive possession regard must be had to the substance of the agreement. To give exclusive possession there need not be express words to that of effect: it is sufficient if the nature of the acts to be done by the grantee requires that he should have exclusive possession.

The grant of an exclusive right to a benefit can, however, be inferred only from language, which is clear and explicit. If an exclusive right of possession is subject to certain reservations or to a restriction of the purpose for which the premises may be used. The reservations or restrictions will not necessarily prevent fie grant operating as a lease.

1024. When grant conferring exclusive possession operates merely as license : A grant which confers the right to exclusive possession may operate as a license in the following circumstances which negative the intention to create a lease.

1025. Instances of agreements creating licenses: A license is normally created where a person is granted the right to use premises without becoming entitled to exclusive possession thereof, or the circumstances and conduct of the parties show that all that was intended was that the grantee should be granted a personal privilege with no interest in the land. If the agreement is merely for the use of the property in a certain way and on certain terms while the property remains in the possession and control of the owner, the agreement will operate as a license even though the agreement may employ words appropriate to a lease.'

13. Shri Savant also tried to derive support to his submission from the judgment of the Delhi High Court in Chandu Lal v. Municipal Corporation of Delhi, : AIR1978Delhi174 . He relied upon para 15 of the' said judgment. I see no dispute in regard to the principles laid down by the Supreme Court as well as by the Delhi High Court in the above-referred two judgments The only question in the present case is whether The authorities below were right in concluding that the respondent was put in exclusive possession of the suit premises or petitioner as contended by him was withholding some part of the premises there by suggesting a joint possession along with the respondent. In order to determine as to whether exclusive possession was given, to the respondent or not under the said document one has to first go to the said document dated June 1, 1964, contents of the application of the petitioner filed under section 41 of the Act and his evidence. So far as the document is concerned, it is wholly silent on the question of retaining possession of any part of the premises by the petitioner. Shri Savant was unable To point out any term in the said document suggesting even remotely that the petitioner had part of the premises in possession or jointly in occupation of the said premises along with the respondent. So far as the contents of the application under section 41 of the Act are concerned, there is also no allegation in the said application suggesting that he was in any manner enjoying the possession of any part of the premises jointly with the respondent. Only in the evidence the petitioner sought to make out a case that he was in joint possession along with respondent. Both the courts below have rejected this part of the evidence of the petitioner on the ground that it is an after thought attempt on his part to dislodge the exclusive possession of the respondents. The petitioner sought, to suggest in his evidence that he was carrying on the business in Bombay but was unable to produce any material on record to show that either in 1965 or prior to 1965 he was carrying on any business either in the suit premises or in Bombay. The bare word of the petitioner would not be sufficient to come to the conclusion that he was enjoying the joint possession with the respondent. In my opinion both the courts below were, therefore, right in holding that the petitioner was not in possession of any part of the suit premises independently or jointly alongwith the respondent. As against this the respondent in his points of defences has categorically averred that he has been in exclusive possession of the suit premises since June 1, 1964 and he continued to be so till this day. The respondent in his evidence has also asserted that entire suit premises has been in his possession and at no time the petitioner was in possession of any part of the suit premises. The courts below accepted the evidence of the respondent on the question of exclusive possession and this being a finding of fact it would not be permissible for me to interfere with the said finding of fact.

14. Once the exclusive possession of the respondent pursuant to the said documents is established it changes the entire complexion of the nature of transaction. At this stage, it would be material to refer to the relevant provisions contained in the Transfer of Property Act in connection with the lease and provisions contained in the Easements Act in connection with the license. The relevant part of section 10 of the Transfer of Property Act is as follows :

'A lease of immovable property is a transfer of a right to enjoy such property made for 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 occasion to the transferor by the transferee who accepts the transfer on such time.'

Section 52 of the Indian Easement Act provides as follows :

'Where one person grants to another, or to definite number of the 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.'

15. Upon reading of these provisions it will be noticed that one of the elements in the definition of 'license' is that the right granted to the licensee should not be an interest in the immovable property in question. It follows that where a dispute arises as to whether a transaction is a license or a lease the primary question is whether the transaction is a lease. The provisions of section 105 of the Transfer of Property Act show that transfer of right amounts to a lease if three requirements are fulfilled viz.

1) the transfer must be of right to enjoy immovable property;

2) the transfer must be for a certain time;

3) the transfer must be for valuable consideration.

If these three requirements are fulfilled the transfer amounts in law to lease. It is therefore, not permissible to parties to enter into a transaction which amounts to a lease as defines in section 105 of the Transfer of Property Act and then to say that the transaction does not create a lease but amounts to a license. In order to determine the true nature of the transaction, therefore, the intention of the parties is of a paramount importance in deciding whether the transaction was a lease or license. But, in my view the said intention must relate to the elements which constitutes a lease or a license respectively. Thus one of the requirements of the lease is that it must be transfer or right to enjoy immovable property and such a transfer necessarily implies the grant of the right to exclusive possession of the immovable property by the transferor to the transferee. It is, therefore, of primary importance in construing the terms of 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 as to whether the other conditions of the lease have been fulfilled. This is particularly so in deciding whether the transfer was for valuable consideration. It is also well settled that exclusive possession by itself does amount to creating an interest in the property if such a transaction is not for valuable consideration but entered into out of love and affection and sympathies. In the present case, I have already pointed out that the respondent has been in exclusive possession of the property and he has been enjoying the same in his own rights. If this exclusive possession is coupled with the valuable consideration then obviously the only conclusion is that the transaction was of a lease and not of a license. It has come on the record that the petitioner has been charging Rs. 550/- as compensation in respect of the suit premises. The petitioner has admitted in his evidence that the standard rent of the suit premises would be Rs. 150/-, (This is his rough estimate and may not be final). The justification sought to be given by the petitioner in his evidence for compensation of Rs. 550/- is that he was charging Rs. 400/- for furniture. In regard to the furniture if one looks at Schedule it would hardly inspire confidence in the Court that on such a furniture Rs. 400/- per month would be charged. In fact the respondent on oath has asserted that only places viz. table, chair and stool were in the suit premises and rest of the articles mentioned in the schedule to the agreement as shown in the suit premises were in fact not lying in the suit premises at all. Both the courts below negative the contention of the petitioner on this score and have rightly in my opinion concluded the transaction in dispute was for valuable consideration. In addition to this a fact cannot be lost sight of that the respondent had deposited Rs. 5000/- with the petitioner on the date of the said agreement and the said amount does not carry any interest. It is true that the same is refundable to the respondent as and when he hands over the possession of the suit premises to the petitioner. The petitioner has also admitted having received Rs. 5000/- by way of deposit. Upon this conclusion it would have to be held that the second requirement of lease transaction namely valuable consideration is also established in this case.

16. It is not the case of the petitioner that the suit premises were given to the respondent out of love and affection or out of sympathies. The petitioner has admitted that until the premises were given to the respondent he was not knowing him, and he came to know him only when he approached him and requested him to give the premises to him on leave and license. Therefore, the learned Judges of the courts below were right in holding that the transaction in dispute was for valuable consideration and it fulfilled the second condition of lease.

17. The third condition viz. that the transfer must be for a certain time and in the present case there is no dispute that under said document the respondent was put in possession for 11 months. If these three conditions of lease are fulfilled in a given case that although the document is styled as a license by the parties it will have to be held that the said transaction is in the nature of lease and not license.

18. Mr. Gurusahani, learned Counsel appearing for the respondent rightly relied upon the judgment of this Court in Sohan Lal Naraindas v. Laxmidas, 61, Bom.L.R. 400. In the said judgment this Court held as follows :

'..........It is clear from the terms of section 105 of the Transfer of Property Act that where the three conditions mentioned in that section are fulfilled, the transfer amounts to a lease as a matter of law. It is not permissible to parties to enter into a transaction which amounts to a lease as defined by section 105, and then to say that the transaction does not create a lease but amounts to a license. We agree that the intention of the paramount importance in deciding whether a transaction between them was a lease or license, but in our view, the said intention must relate to the elements which constitute a lease or a license respectively. Thus one of the requirements of a lease is that it must consist of transfer of a right to enjoy immovable property. Such a transfer necessarily implies the grant of the right to exclusive possession of immovable property by the transferor to the transferee. It is, there fore, 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 immovable property was transferred for a certain period, the transaction might amount to a license and not a lease where a dominant consideration was not the price which the transferee was to pay for those and enjoyment of the property. A railway company may grant exclusive possession of a separate room at a railway station for conducting a tea stall for a specified period, and yet the transaction would amount to a license, as the dominant consideration of the railway company in such a case is the provision of amenities to railway passengers, and not the price that may be paid by the transferee for the enjoyment of the immovable 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 may also be granted to 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 transaction is a lease or a license their intention with regard to the elements which in law constitute a lease or a 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 the 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.'

19. The view taken by the Division Bench in the above referred judgment subsequently came to be confirmed by the Supreme Court in 1971 All I R C J 203. The Supreme Court observed as follows :---

'9. Intention of the parties to an instrument must be gathered from the terms 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 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 to 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 license the test of exclusive possession, though not decisive, is of significance.

20. Shri Savant, then relied upon the judgment of the Supreme Court, in Mrs. M.N. Clubwala v. Fida Hussain Saheb : [1964]6SCR642 , and submitted that in a given case there might be an exclusive possession with the licensee but that by itself is not conclusive to come to the conclusion that the transaction is that of lease and not of license. The facts of this case show that the stalls were given to the various stall-holders for running the business. The various stalls were not in the form of rooms as such, as it appears from the nature of the description given in the said judgment. It is also material to note that the stall-holders were allowed to use the respective stalls only between 4 a.m. and 11 p.m. and after 11 p.m. they were to vacate the respective stall and neither the stall holders nor their servants were allowed to sleep in those stalls. The liability and/or obligation was also cast upon the landlord to clean and disinfect the same after the stalls were left by the stall holders after 11 p.m. From these facts it is clear that the stall-holders were given the exclusive possession was held by the licensor. The facts of that case therefore are clearly distinguishable and I do not think that the ratio laid down by the Supreme Court in the said judgment will be applicable to the facts of the present case.

21. Shri Savant then sought to rely upon the judgment of the Delhi High Court in Chandu Lal v. Delhi Municipality, : AIR1978Delhi174 , wherein the Delhi High Court has drawn a distinction between a lease and a license and after construing the document in question reached a finding that the transaction was in the nature of license and not lease. I have gone through the facts of that case and I do not think that the ratio of the said judgment will have any application to the facts of the present case.

22. Shri Savant, then relied upon the two conditions namely, conditions Nos. 6 and 7 of the document and submitted that consistent with the said condition No. 6, it must be held that the legal possession was with the petitioner. He submitted that the liability was cast upon the petitioner to pay various municipal taxes, cess, assessment, lease money and society's maintenance charges in respect of the said office room. I do not think that in the present case having regard to the compensation fee charged by the petitioner this condition is inconsistent with the quantum of license fee.

23. Shri Savant strongly relied upon condition No. 7 which reads as under :---

'7. That the use hereby allowed to the licensee is and shall expressly be on leave and license basis and the licensee shall therefore have no right, title or tenancy whatsoever in the said premises nor shall he be entitled to claim any tenancy rights in the said premises at any time thereafter.'

Relying upon the admission given by the respondent during cross examination viz., 'It is true that I signed Ex. A knowing fully well that it was not a formal document', it is urged by Shri Savant that the respondent has accepted all the terms and conditions mentioned in the said document and from this admission read with the condition No. 7 incorporated in this said document, no other inference save and except that the respondent is a licensee is possible. As stated earlier, the intention of the parties has to be gathered from the attending circumstances and the various attending circumstances which I have pointed out clearly show that the intention of the parties was to create a lease and not a license. The admission, therefore, would not take the case of the petitioner further.

24. Shri Savant then sought to rely upon the letter dated March 13, 1965, written by the respondent to the petitioner consenting for the renewal of the license. This letter has also been taken into account by both the courts below. After taking into account the various circumstances and oral evidence on the record the view taken by the courts below in this behalf, in my opinion, is correct.

25. The courts below have taken into account all those various circumstances and, in my opinion there is no error apparent on the face of the record which would call upon me to interfere with the said judgments. The various circumstances relied upon by Shri Savant, the learned Advocate General, to show that the true nature of the transaction was a license and not a lease therefore do not appear to me. The petition, therefore, has no force and the same is liable to be dismissed.

26. In the result, the petition fails and the rule is discharged. In the circumstances of the case there shall be no order as to costs.


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