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Babulal Gulabchand Vs. Nathulal Badrilal - Court Judgment

LegalCrystal Citation
SubjectProperty;Civil
CourtMadhya Pradesh High Court
Decided On
Case NumberMisc. Appeal No. 174 of 1971
Judge
Reported inAIR1976MP222
ActsTransfer of Property Act, 1882 - Sections 105, 106 and 111; Code of Civil Procedure (CPC) , 1908 - Sections 47
AppellantBabulal Gulabchand
RespondentNathulal Badrilal
Appellant AdvocateR.K. Vijayvargiya, Adv.
Respondent AdvocateM.K. Yeotikar, Adv.
DispositionAppeal allowed
Cases ReferredBai Chanchal v. Syed Jalaluddin
Excerpt:
.....right to enjoy it exclusively free from interruption and disturbance even by the owner. in other words, the right of an owner to enjoy his property is carved out in favour of a person to whom it is let. in the instant case, the appellant was to enjoy the exclusive possession of the house as of right as a monthly tenant for an indefinite period liable to be determined on the conditions mentioned in the compromise. in the end it was prayed that a decree for compromise be given (para 3). x x xfor the obvious reason that a specified date was provided for the eviction of the defendant, it can very well be predicated in, ramji bhai's case air 1954 bom 370 that that was a decree really for eviction, though only the date of eviction was postponed. in the instant case, the appellant was to..........to it and all the incidents of contract are applicable to it. applying this principle, the compromise decree is a contract which has resulted in creating a fresh tenancy between the appellant and the respondent. as a consequence of this new tenancy, for the non-compliance of its terms contained in the decree, the appellant cannot be ejected till the tenancy is terminated by a fresh valid notice under section 106 of the transfer of property act and a suit on any one or more of the grounds provided under section 12 of the madhya pradesh accommodation control act, 1961, is filed. en short, his argument was that the appellant is occupying the house as a monthly tenant. therefore, the remedy of the respondent, even on reading the omitted term of the compromise in it, is by way of a.....
Judgment:

U.N. Bhachawat, J.

1. This is an appeal directed against the judgment, dated 25-11-1971, in Civil Regular Appeal No. 24 of 1971 arising out of the proceeding in execution passed in a suit for eviction under the Madhya Pradesh Accommodation Control Act, 1961, passed on the ground of Section 12(1) (a).

2. The plaintiff, who is the decree-holder respondent herein, brought a suit for eviction against the present appellant, who is the judgment-debtor defendant, on the ground that there was a default by the defendant in payment of arrears of rent, within two months from the date of service of notice of demand on him. The suit was for Rs. 630 as rent+Rupees 247.50 as mesne profits + Rs. 15.50 as notice charges, totalling to Rs. 892.00. This was compromised on 6-11-1970 for a sum of Rs. 1901, inclusive of costs, out of which Rs. 400 were paid in cash by the defendant judgment-debtor. This fact was recorded in the compromise. The other terms of the compromise are reproduced verbatim hereunder:--

ckdh jgs gqos :i;s 'O dh vnkbZ izfrekg :i;s2' iPphl ds fglkc ls nsdj dj nqaxkA igyh fd'r :i;s 2' dh rk-&2&'O dks nsaxkA o vkxs ,sls gh nj ekg dh rk dks fd'rsa nsrktkdj dqy :i;k vnk dj nqaxkA

oknh dk edku fdjk;k izfrekg :i;s ' ds fglkcls gj ekg ds rkjh[k dks fd'r ds lkFk gh nsrk tkdj tqeyk :i;s 'O nsrk tkdjikorh ysrk tkaxkA

vxj ,d fd'r pqdwaxk rks oknh dks vf/kdkj gksxkfd os edku dk fjDr vkf/kiR; eq>ls ys ysosa o lkFk gh 'ks'k jde tks oknhdks ysuk gks oks ,d eq'r e; dksVZ [kpZ lfgr olwy dj ysosaA ;kus :i;s 'O dhjde gj ekg ds rkjh[k dks vnk ugha dh rks oknh p<+k gqok fdjk;k o fMh fdjde ,d eq'r olqy dj ysosaA bl eqtc oknh rFkk izfroknh dk vkilh rksM+ gqok gS mlewtc

oknh ds fgr esa t;i= iznku fd;k tkosa fd'r ofdjk;k oDr flj vnk u djus ij oknh ctkojh ekaMdj dCtk ys ysosa o :i;k olwy djysosa ;g vtZ gSA Rkk- '&&'O lghA

izfroknh

ckcwyky

eSa oknh fy[k nsrk gwa fd ij dk fy[kk gqvkvkilh rksM eq>s Lohdkj gSA rk- '&&'O

lgh % oknh

uFkqyky

3. On the basis of the eforesaid compromise, the decree incorporating all the terms of this compromise except one which shall be referred to hereinafter at the appropriate stage was passed.

4. The respondent put this decree under execution vide his undated application which according to the proceedings sheet of the executing Court appears to have been filed on 29-6-1971 for the recovery of arrears and possession of the house. The appellant put in his objection petition, dated 6-7-1971, inter alia, objecting to the executability of the decree which was rejected by the executing court vide order dated 19-7-1971, in the proceedings sheet.

5. The appellant filed an appeal, against the order of the executing Court, but he was unsuccessful and hence this second appeal before this- Court.

6. It is unnecessary for me to mention all the various objections that were taken by the appellant in the executing Court, in the lower appellate Court and in the memorandum of appeal to this Court. The following points only were urged before this Court during the course of argument by the learned counsel for the appellant:

(i) The decree is only declaratory and hence cannot be executed; and

(ii) The compromise has created a fresh tenancy. The remedy of the respondent was by way of a fresh suit and not by way of execution of the decree. The decree is unexecutable. Both the points are interlinked. I, therefore, deal both of them together.

7. The argument of the learned counsel for the appellant was that--

(a) the following clause which is in the compromise has been specifically omitted from the decree:

^^fd'r o fdjk;k oDr flj vnk u djus ij oknhctkojh ekaMdj dCtk ys ysosa o :i;k olqy dj ysos ;g vtZ gS]**

(b) the only inference from the above omission is that the Court, which made the compromise, the rule of the Court did not find that term lawful and, therefore, did not order its incorporation in the decree. According to Order XXIII, Rule 3, Civil Procedure Code, the Court can order the recording only of that agreement which is found by it to be lawful. As a consequence of this omission, the decree is nothing but a declaratory decree; and

(c) even on postulating the existence of the .aforesaid term, the decree would still remain unexecutable. The decree passed on the basis of a, compromise is nothing but a contract with the command of the Judge superadded to it and all the incidents of contract are applicable to it. Applying this principle, the compromise decree is a contract which has resulted in creating a fresh tenancy between the appellant and the respondent. As a consequence of this new tenancy, for the non-compliance of its terms contained in the decree, the appellant cannot be ejected till the tenancy is terminated by a fresh valid notice under Section 106 of the Transfer of Property Act and a suit on any one or more of the grounds provided under Section 12 of the Madhya Pradesh Accommodation Control Act, 1961, is filed. En short, his argument was that the appellant is occupying the house as a monthly tenant. Therefore, the remedy of the respondent, even on reading the omitted term of the compromise in it, is by way of a suit and not by executing the decree and it is in that suit his entitlement to ejectment and on what grounds would be examined. The learned counsel has placed strong reliance on a decision in Kanmal v. Hukumchand, (AIR 1966 Raj 178).

8. The reply of the learned counsel for the respondent was that all the terms including the one omitted should be read in the decree. The omission is a mere clerical error which can be corrected even at this stage by this Court. His further argument was. that with or without this term the decree recognised the termination of the relationship of landlord and a tenant between the parties. The appellant was allowed to continue in possession as a licencee and subject to his having made the payment of the arrears and the monthly rent regularly as agreed, on the clearance of the arrears, he was to have the status of a tenant. While putting his interpretation to the decree, he submitted that the mere use of the word 'rent (Kiraya)' would not bring forth the relationship of a landlord and a tenant. According to him, looking at the use of the word 'rent' in the context of event preceding the compromise, i.e., the termination of tenancy and filing of the suit for ejectment, the word 'rent', here in the compromise decree, till the status of a tenant was restored as stated above, would mean mesne profits.

9. The decision of the rival contentions, of the learned counsel for the parties, hinges on the construction of the compromise decree and the distinction between a lease and a licence. The existence or omission of the above referred clause in the decree, in the instant case, would not be a determining factor of its executability or otherwise.

10. Now, dealing with the question of construction of the compromise decree, I would, at this stage, like to advert to the decision of their Lordships of the Supreme Court in Konchada Ramamurty v. Gopinath, (AIR 1968 SC 919), wherein the principles laid down in various decisions of the Supreme Court and of the foreign Courts are reproduced and relied upon. The observations of various decisions quoted in this decision with approval are reproduced below;

'Before we approach the question of the construction of the compromise deed, we may refer to two decisions of this Court bearing on the distinction between a lease and licence and the principles for distinguishing one from the other. This Court observed in M. N. Clubwala v. Fida Hussain Saheb, 1964-6 SCR 642 at pp. 652, 653 = (AIR 1965 SC 610 at p. 614):'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. This intention has to be ascertained on a consideration of all the relevant provisions in the agreement'.'

This Court further observed that exclusive possession is not conclusive evidence of a lease. 'If, however, exclusive possession to which a person is entitled under an agreement with a Landlord is coupled with an interest in the property, the agreement would be construed not as a mere licence but as a lease. (See Associated Hotels of India Ltd. v R. N. Kapur, 1960-1 SCR 368 at p. 384 = (AIR 1959 SC 1262 at p. 1269).

In 1960-1 SCR 368 at p. 384 = (AIR 1959 SC 1262 at p. 1269) Subba Rao, J., as he then was summarised the proposition as follows:

'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 a 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 an intention to create a lease.'

Lord Denning, speaking for the Judicial Committee of the Privy Council in Isaac v. Hotel De Paris, 1960-1 All ER 348-352 observed :

'There are many cases in the books where exclusive possession has been given of premises outside the Rent Restriction Acts and yet there has been held to be no tenancy. Instances are: Errington v. Er-rington and Woods, 1952-1 All ER 149 and Cobb v. Lane, 1952-1 All ER 1199 which were referred to during the argument. It is true that in those two cases there was no payment or acceptance of rent--though of great weight is not decisive of a tenancy where it can be otherwise explained: See Clarke v. Grant, 1949-2 AH ER 768. As Lord Greens M R., said in Booker v. Palmer, (1942) 2 All ER 674-677.

'There is one golden rule which is of very general application, namely, that the law does not impute intention to enter into legal relationship where the circumstances and conduct of the parties negative any intention of the kind'. ' In the light of the aforesaid observations, their Lordships found that the terms of the compromise decree which was under consideration indicated that the intention of the parties was not to enter into the relationship of a landlord and a tenant. The learned counsel for the respondent had placed a reliance on this case in support of his contention.

11. The principle discernible from the aforesaid case is that the touchstone to determine whether an agreement created a relationship of landlord and tenant or that of licensor and licensee is the intention of the parties and the intention has to be gathered after reading the document as a whole, and not merely the use of the few words. An expression torn of its context should not be picked out nor the document should be construed on the basis of such expression. But where the words are free from ambiguity in themselves and where the external circumstances and conduct of the parties do not create any doubt or difficulty as to the proper application of words, the document has to be construed according to the strict plain and common meaning of, the words themselves. The language employed in the document speaks of the intention.

12. It cannot be gainsaid that in common parlance 'rent (Kiraya)' means a payment by a tenant to his landlord, but in a particular case in the context of circumstances and conduct of parties, it may mean payment by a licencee for use and occupation to his licensor.

13. Examining the compromise decree in the instant case, in the light of the aforesaid discussion, for the reasons given hereinafter, I am of the firm view that it does create a fresh tenancy.

It is axiomatic that once the tenancy is terminated, the relationship of a landlord and a tenant does not survive. A person, who was inducted as a tenant, has to vacate immediately, he cannot continue except either he is permitted as a concession to stay on for some time, or a fresh tenancy is created.

14. In the instant case, under the compromise, the appellant was entitled to continue in possession exclusively for an indefinite period, though he was to pay rent and the instalment of arrears regularly on the stipulated date,

If the intention of the respondent was not to create a fresh tenancy, the respondent having filed a suit for ejectment would not have agreed to the appellant's continuance in exclusive possession as of right, though requiring the appellant to make payment regularly. He could have at the most on compassionate, or any other ground allowed some fixed time to the appellant for vacating the house.

The suit was based only on the ground of default in payment of arrears of rent, i.e., under Section 12 (1) (a) of the Madhya Pradesh Accommodation Control Act. There are provisions contained in Sections 12 (3) and 13 (5) of the Act which protect a tenant against eviction on the ground under Section 12 (1) (a).

It, therefore, appears that the respondent would have thought it advisable to secure the regularity in payment of his dues and to allow the appellant to continue as a tenant. It is always open to a landlord-plaintiff, who has determined the tenancy and filed a suit for ejectment, to have a compromise decree whereby the defendant may once again become his tenant.

15- The portion ^^oknh dk edku fdjk;k izfr ekg:i;s '' ds fglkc ls gj ekg ds rkjh[k dks fdLr ds lkFk gh nsrk tkdjtqeyk :i;s 'O nsrk tkdj ikorh ysrk tkaxkA**

is the key portion which unlocks the intended legal relationship between the parties. It positively indicates that the appellant's possession under the compromise since its date was to continue as a tenant.

On reading the document as a whole, giving the words used there in their plain, grammatical meaning, they lead only to one irresistible inference that the relationship of a landlord and a tenant was intended to be created thereby. The word 'rent (Kiraya)' used meant payment by a tenant to his landlord. In the instant compromise, the context, conduct and circumstances do not suggest any other meaning. Throughout the compromise for the monthly payment for the occupation of the house the word 'Kiraya' has been used. No part of the compromise supports the contention of the learned counsel for the respondent that till the clearance of arrears of Rs. 1,501, the possession of the appellant shall continue in a status otherwise than of a tenant and thereafter as a tenant. If the intention of the parties was as contended by the learned counsel for the respondent, to mark a distinction in the status of the appellant till clearance of arrears and thereafter different words would have been used for the monthly payment of Rs. 45.

The portion following aforesaid portion

^^vxj ,d fdLr pqdwaxk rks oknh dks vf/kdkjgksxk fd oks edku dk fjDr vkf/kiR; eq>ls ys ysosa o lkFk gh 'ks'k jdetks oknh ds ysuk gks oks ,d eq'r e; dksVZ [kpZ lfgr olwy dj ysosaA ekus :i;s'O dh jde gj ekg ds rk- dks vnk ugha dh rks oknh p<+k gqvk fdjk;k ofMh dh jde olwy dj ysosaA bl eqtc oknh rFkk izfroknh

dk vkilh rksM+ gqok gS ml eqtc oknh ds fgr esat;&i;= iznku fd;k tkosA**

dicates the terms for the determination of the tenancy. These are the normal conditions which are found in a contract of tenancy (see Section 111 of the Transfer of Property Act). These conditions do not militate against the creation of tenancy. These subsequent terms about the determination of the right under which the appellant was continuing since the date of compromise pre-supposes that there was some right.

The transfer of the right to enjoy the property is the sine qua non of the relationship of landlord and tenant. On a plain reading of Section 105 of the Transfer of Property Act, it is clear that lease is nothing but the transfer of the right by the owner in favour of the person to whom it is let whereby the owner excludes himself from the enjoyment of the property and the lessee gets the right to enjoy it exclusively free from interruption and disturbance even by the owner. In other words, the right of an owner to enjoy his property is carved out in favour of a person to whom it is let. In the instant case, the appellant was to enjoy the exclusive possession of the house as of right as a monthly tenant for an indefinite period liable to be determined on the conditions mentioned in the compromise. According to the terms in the compromise in case of no default, the appellant was to continue in the status in which he was initially allowed and that status was, as indicated by the above quoted key portion, of, a tenant.

The later portion, i- e., the portion commencing from ^^vxj ,d fd'r pqdwaxk rks (reproduced above) reinforces the construction of the compromise that it created a fresh tenancy.

16. The Rajasthan High Court has also taken a view similar to mine in Kanmal v. Hukumchand (Supra). The terms of the compromise decree in this Rajasthan case were more or less identical to the terms in the instant compromise decree. The relevant terms of the compromise decree and the observation of the Rajasthan High Court in the aforesaid case are reproduced below:

'The first clause states that each of the parties shall bear half of the costs. Clause 2 states that the defendant had paid Rs. 280/-on that date and upto 1-10-1957 Rs. 370/-were due and to this was to be added half of the costs of the suit which the defendant undertook to pay by six monthly instalments of Rs. 150/- each and the instalments were to be paid till the arrears were cleared. Clause 3 provided that from 1-10-1957, the defendant shall pay Rs. 25/- per month as rent of the shop and this he shall pay on the first of every month. Clause 4 laid down that in case of non-compliance of Clauses 2 and 3 by the defendant, the plaintiff was to be entitled to get the defendant evicted from the shop. Clause 5 provided that whatever payments shall be made would be evidenced by receipts and no payment shall be acceptable without a receipt. In the end it was prayed that a decree for compromise be given (Para 3).

x x xFor the obvious reason that a specified date was provided for the eviction of the defendant, it can very well be predicated in, Ramji Bhai's case AIR 1954 Bom 370 that that was a decree really for eviction, though only the date of eviction was postponed. This is not so in the present case. The defendant was to remain in possession for an indefinite period, though he was to pay rent regularly each month. To hold that eviction could be ordered in execution even in such a case after an indefinite period may lead to odd results. For example if after 15 years the defendant were to commit default in the payment of rent, then according to learned counsel the decree-holder will be relieved from filing a separate suit, but would be able to ask for eviction in execution of a decree. Then supposing rent of some years is in arrears and then the question will be, how that rent is to be realised and if there is any dispute about the genuineness of any receipt for rent., then the question would be, who is to determine whether any rent was really due and whether any particular receipt was genuine.

These questions obviously, in the very nature of things, could not be dealt with in execution. A decree must determine the rights and liabilities of the parties finally and it cannot obviously be the province of an execution Court to determine the rights and liabilities that would be accruing in future on account of future defaults. On a consideration of the clauses of the compromise in the present case we are inclined to agree with the learned single Judge that Clause 3 of the compromise resulted in creating a fresh tenancy. Creation of a fresh tenancy could not certainly be within the scope of the suit and, therefore, Clause 3 of the compromise cannot., in our view, be enforced in the execution proceedings. For this a separate suit is the only remedy.'

17. The terms of the compromise decree in Konchada Ramamurty Subudhi v. Gopinath (Supra) are not comparable to the terms of the present case. The terms of the compromise were:

'1. Respectable people have settled the subject matter of this appeal and the suit and so both parties agreed to compromise as follows:

(a) That the defendant-respondent should vacate the suit house on or before 1st July, 1960 (five years) failing which the appellant plaintiff will be entitled to execute this decree and recover possession of the suit house through court after the date fixed above.

(b) That in respect of all arrears of rent claimed in the suit and the rent due during the pendency of the suit and of this appeal as calculated upto 30th June, 1955, the defendant has paid to the plaintiff the sum of Rs. 1,125/- only (Rupees one Thousand and one Hundred Twenty-Five only).

(c) That in respect of future rent i e. with effect from 1st July, 1955 the defendant shall pay to the plaintiff at the rate of Rs. 50 a month by the end of each month until delivery, and a sum of Rs. 300 is paid to plaintiff to be kept as deposit for six months rent to be adjusted towards rent for the period of last six months ending with 1st July, 1960.

(d) In case the defendant fails to pay the rent for any three consecutive months the plaintiff will be at liberty to adjust the advance towards arrears and also to evict the defendant from the suit house without waiting till 1st July, 1960 by executing the decree and also realise the amount accrued due by then, from the defendant by executing his decree.

(e) That the house fell to the share of a minor son of plaintiff appellant, namely, Konchada Koteshwarrao for whom the appellant plaintiff is the guardian, and the plaintiff-appellant will be responsible for the due compliance of the terms of this compromise.

2. That each party do bear its own costs in both Courts.

3. That a decree may be passed in tha above terms.'

In this case, it was in context of the other clauses, reading Clause (d) their Lordships held that no tenancy was created. In the instant case, the last Clause which is reproduced in paragraph 7 (a) above cannot, reading along with the other terms, be taken to militate against the intention creating fresh tenancy. In the instant case, the appellant was to enjoy the exclusive possession as of right in the capacity of a monthly tenant for an indefinite period determinable on the condition mentioned in the compromise. This Clause in the instant compromise merely provides the procedure as to how the right created under the consent decree would be enforced. It is independent and separable from the other part of the compromise decree. What should be the procedure for enforcing the rights created under the consent decree i. e., by a suit or execution of the decree is dependable on the construction of the consent decree, i. e., whether it created a fresh tenancy or not,

18. The learned counsel for the respondent had placed reliance on a decision of their Lordships of the Supreme Court in Bai Chanchal v. Syed Jalaluddin (AIR 1971 SC 1081), but that case does not support the respondent's contention. The terms of the compromise decree in this case are not comparable to the compromise decree in hand. The relevant portions of the judgment are reproduced below:

'The second point urged by learned counsel was that, by the consent decree itself, a new tenancy was created which was to continue for five years and, in the meantime, the Bombay Rent Hotel and Lodging House Rates Control Act, 1947 came into force and the appellants were protected from ejectment under the provisions of that Act. The consent decree does not state that a new tenancy is being created. The argument was that the terms of that consent decree should be interpreted as indicating an intention to create a new tenancy. We are unable to find any such terms. On the face of it, all that the consent decree envisaged was that, though the judgment-debtors were liable to immediate eviction, the decree-holders agreed to let them continue in possession for a period of five years. Since this concession was being granted as a special case, the decree-holder insisted that mesne profits should be paid at a much higher rate so much so that between all the defendants, governed by the two decrees of 8th July, 1946 and 28th January, 1949, the amount payable as mesne profits became Rs. 7,314-80 per annum which had no relation with the original rent of Rs. 199/-per annum for the entire land fixed by the lease of 1895. In fact, the decree-holders sought further protection by requiring the judgment-debtors to pay the mesne profits in monthly instalments, and instalments so fixed that the mesne profits due for five years were to be paid within a period of three years. There was the further Clause that, in case of default of payment of the mesne profits, the defaulting judgment-debtors could immediately be called upon to deliver possession. These terms can, in no way, be interpreted as creating a new tenancy constituting the decree-holders as landlords and the judgment-debtors as their tenants. The terms of the consent decree neither constituted a tenancy nor a licence. All that the decree-holders did was to allow the judgment-debtors to continue in possession for five years on payment of mesne profits as a concession for entering into a compromise. The argument advanced must, therefore, be rejected,'

In view of the aforesaid discussion, I hold that the instant compromise does create a fresh tenancy.

19. It was a common ground between the parties, and rightly, that, in case it is held that the compromise created a fresh tenancy, the appellant cannot be ousted from possession in the execution of the compromise decree. In that event the only remedy available to the respondent would be by way of a fresh suit.

20. In the result, the appeal succeeds. The order (judgment) under appeal is set aside and it is held that the appellant cannot be ejected in the execution of the compromise decree. In the special circumstances of the case, I make no order as to costs.


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