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Swami Jai Ram Chela Sarju Das Vs. Hari Singh - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtPunjab and Haryana High Court
Decided On
Case NumberSecond Appeal 115-D of 1964
Judge
Reported inAIR1967P& H159
ActsTransfer of Property Act, 1882 - Sections 105; Code of Civil Procedure (CPC), 1908 - Order 8, Rule 2
AppellantSwami Jai Ram Chela Sarju Das
RespondentHari Singh
Appellant Advocate Iqbal Krishan, Adv.
Respondent Advocate Madan Bhatia, Adv.
DispositionAppeal allowed
Cases ReferredGopalan Nair v. Kunhan Menon
Excerpt:
.....arrears but would not even in that case be entitled to eject the tenant. (x) the parties to the lease deed as well as their heirs, successors and legal representative would be bound by the terms of the lease and will not back out of the same. (viii) the tenant has been given the authority even to alienate, sell or mortgage his rights in the leasehold as well as in the superstructure that he may make thereon. though it is not necessary to go into the reason why the period of 20 years was at all fixed in the deed of lease though it was clearly intended to be in perpetuity, it appears to me that this was possibly in order to save some petty amount on account of the difference in the stamp duty which would be payable for ft lease which purports to be for a term in excess of three years on..........at the, rate of 6 annas per annum for the purpose of building a house thereon by a registered lease deed dated 23rd december, 1941 (registered on 27-12-1941) of which a certified copy is exhibit p. 1. the period of the lease expired on 23-12-1961. on december 26, 1961 the tenant gave notice exhibit d. 1 to the landlord informing him that the tenant had built superstructures on the plot and was entitled to continue as the lessee on the same terms as contained in the original lease deed and that he was also ready to execute a fresh lease deed as provided in the previous one. he accused the landlord of avoiding to receive rent and warned him that the landlord was in no way entitled to obtain possession of the land in suit.on january 2, 1963, the landlord filed a suit for ejectment of.....
Judgment:

R.S. Narula, J.

1. A plot of land measuring about 100 square yards situated in Yusaf Sarai, Delhi was taken by Swami Jairam Dass appellant (hereinafter referred to as the tenant) from Shri Hari Singh respondent (hereinafter cal(SIC) the landlord) for a period of 20 years at the, rate of 6 annas per annum for the purpose of building a house thereon by a registered lease deed dated 23rd December, 1941 (registered on 27-12-1941) of which a certified copy is exhibit P. 1. The period of the lease expired on 23-12-1961. On December 26, 1961 the tenant gave notice exhibit D. 1 to the landlord informing him that the tenant had built superstructures on the plot and was entitled to continue as the lessee on the same terms as contained in the original lease deed and that he was also ready to execute a fresh lease deed as provided in the previous one. He accused the landlord of avoiding to receive rent and warned him that the landlord was in no way entitled to obtain possession of the land in suit.

On January 2, 1963, the landlord filed a suit for ejectment of the tenant from the plot in dispute admitting the terms of the lease exhibit P. 1 but claiming that the same was only for a period of 20 years on the expiry of which period the tenant had to surrender the lease and give vacant possession of the plot to the landlord without any notice from him. He also claimed the contravention of the lease on the ground that the tenant had neither paid rent for the preceding three years nor remitted the same to the landlord as required by Clause 6 of the lease deed exhibit P. 1. The third ground on which ejectment Was sought was that the tenant had not elected to continue the lease before the expiry of the original period of 20 years by executing a fresh lease deed even though, according to the landlord, he was not bound to renew the lease.

The suit was resisted by the tenant. A somewhat vague written statement dated 15-2-1983 was filed by him. It was averred by the tenant therein that the landlord had refused to accept rent which had been sent to him by money order and ultimately the tenant had deposited it in the State Bank of India and that it was the landlord who was declining to renew the lease in spite of registered notice sent to him by the tenant. The tenant added in the written statement that actually the landlord wanted to evict him since the price of land had immensely increased and the insinuation was that otherwise he was not liable to ejectment in law. He stated in so many words in the written statement that no cause of action had arisen in favour of the landlord against the tenant. He alleged that the suit of the landlord was false, frivolous and vexatious and had been filed with a view to harass the tenant, and to force him to vacate the plot so that the landlord could sell it at a higher price.

From the pleadings of the parties the trial Court framed the following four issues :---

1. Whether the lease was not terminated by efflux of time on 23-12-1961, if it was terminated, its effect?

2. Whether the defendant had paid any rent to the plaintiff?

3. If issue Nos. 1 and 2 are decided in favour of the plaintiff, whether the defendant is not liable to ejectment?

4. Relief.

2. By judgment dated September 30, 1963 the Court of Shri Mohinder Singh, Sub Judge 3rd Class, Delhi found on issue No. 1 that at the time of executing the lease deed the parties had no doubt intended to execute a fresh lease deed after the expiry of every 20 years but they never intended to provide for the ejectment of the tenant under any circumstances whatsoever and that the lease was, therefore, for all practical purposes a perpetual one. He also held that the tenant was never negligent to get the lease renewed and that it was the landlord who was not willing to execute a fresh lease on account of the rise in the value of the land. On issue No. 2 the trial Court found that rent had been tendered by the tenant to the landlord in time and the same now lay deposited in the Treasury, but even if it was proved that rent had not been tendered in time the plaintiff could only recover the same but could not claim ejectment on that ground on account of the peculiar terms of the lease. On the basis of his finding on the first issue the learned Sub Judge held that the tenant was not liable to ejectment and, as stated above, dismissed the landlord's suit with costs.

3. The landlord's appeal has been accepted on May 29, 1964 by the judgment of Shri G.R. Luthra, Additional Senior Sub Judge, Delhi wherein it has been held that the trial Court could not give a finding of a perpetual lease in favour of the tenant for want of a definite plea in that respect and that the lease having been for a fixed period automatically came to an end under Section 111A of the Transfer of Property Act by efflux of time. On a construction and interpretation of the various clauses in the lease deed the learned Senior Sub Judge has held that in the absence of a fresh lease the tenant could not save himself from ejectment though he had a right under the terms of the lease 'to sue for specific performance of the agreement to renew the lease after every 20 years. Not satisfied with the above-mentioned judgment and decree of reversal passed by the Additional Senior Sub judge, Delhi the tenant has come up in second appeal to this Court.

4. Shorn of all hyper-technicalities the crux of the matter appears to me in this case to be the intention of the parties at the time of entering into the original lease deed exhibit P. 1 as disclosed on a proper interpretation of the relevant terms of that deed. It has been held by their Lordships of the Supreme Court in Sivayogeswara Cotton Press, Devangere v. M. Panchaksharappa, AIR 1962 SC 413, that the forms in which tenancy rights are created in this country are not uniform and they do not conform to precedents known to conveyancing, sometimes the words used are not precise and it is not always easy to understand from the said words the intention of the parties in executing the document. It has, however, been held authoritatively in the said case that the nature of the tenancy created by any document must be determined by construing the document as a whole. It is, therefore, necessary to first notice the relevant clauses of the lease deed exhibit P. 1 the factum of execution and the correctness of the contents of which is not at all in dispute in this case.

5. The lease deed is in respect of the above-mentioned plot at the above-mentioned rate between the parties to this litigation. The tenant is the first party to the lease and the landlord the second party. In the opening part of the document It is specifically stated that the purpose for which the land is being leased out for enabling the tenant to make a house (pukhta or kham) thereupon according to the wishes of the tenant. It is no doubt mentioned in the document that the period of lease is for 20 years commencing from the date of the execution of the document. But amongst the conditions on which the lease was given, the following appear to be significantly relevant for the decision of this case :--

(i) that the plot had been leased out for the purpose of building a pacca or kacha house of any design and for sinking any well or installing any hand-pump or for having a garden on the plot. In short it is clearly a building lease though no fetter of any kind has been placed on the tenant regarding the nature, size or kind of the building. It is further stipulated in the first condition that the landlord will have no right of interference or of stopping and particular user of the plot;

(ii) that the ownership shall vest in the landlord but the possession shall remain with the tenant;

(iii) that the tenant shall remain the owner of any superstructure that he might build on the land and shall also remain owner of the tree which he may plant thereupon. The tenant shall have a right to sell or mortgage his interest in the plot, the superstructure and trees, etc. to anyone he likes;

(iv) the tenant will continue to pay to the landlord 6 annas per annum against a receipt and the landlord will have no right or authority to increase the rate of rent:

(v) Not relevant.

(vi) The tenant shall go on paying the rent and in the event of his failure to do so for three years the landlord would be entitled to bring a suit for the recovery of the arrears but would not even in that case be entitled to eject the tenant.

(vii) That after the expiry of every period of 20 years of the lease the tenant shall continue to execute a lease deed in favour of the landlord at the same rate of rent. The landlord mall not be entitled to claim enhancement in the rate of rent;

(viii) Not relevant.

(ix) Not relevant.

(x) The parties to the lease deed as well as their heirs, successors and legal representative would be bound by the terms of the lease and will not back out of the same.

6. It is on a construction of the above mentioned terms of the lease deed that the trial court held that the tenant was not liable to ejectment on the expiry of the first period of twenty years and the first appellate Court held to the contrary. In the above mentioned case of AIR 1962 SC 413 their Lordships of the Supreme Court emphasised the fact that while construing a lease deed it should be borne in mind that if the tenancy is for a building purpose, prima facie it may be arguable that it is intended for the lifetime of the lessee or 'nay in certain cases be even a permanent lease, It was held in that case that prima facie such a lease is not intended to be a tenancy-at-will, but, whether it is a tenancy for life or a permanent tenancy must ultimately depend upon the terms of the contract itself. The note of caution sounded by the Supreme Court in that case is that in construing the terms of such contract the Courts must look at the substance of the matter and decide what the parties really intended to do and not merely rely upon literal construction of some isolated terms in the agreement, applying the said principles to this case, and qualifying the above mentioned terms of the lease deed it is clear to me that the parties in this case definitely intended the relationship of landlord and tenant in respect of the plot in question to continue between them in perpetuity on the terms and conditions contained in exhibit P. 1.

I have come to this conclusion particularly because--

(i) it has been specifically agreed to by the parties that on a renewal of the lease after every period of 20 years (the word 'every' is significant) the rate or rent will not be increased;

(ii) contrary to the usual terms of a building lease for a fixed period only it has been provided that the tenant would continue to be the owner of the superstructure and the trees, etc. planted on the plot by him. If the intention was to get the plot vacated in any circumstances after 20 years it would normally have been provided that the superstructures and the trees would thereupon belong to the landlord or that the tenant would be entitled to remove them;

(iii) the lease deed emphasises the fact that even on non-payment of rent for a period of three years or for any period whatsoever the tenant would not be liable to ejectment and the Only right of the landlord would be to recover the arrears of rent by a suit;

(iv) in cases of leases for a fixed period with merely an option to renew them it is usual to provide for the option being exercised before the expiry of the period of the lease. In this case it has been specially provided that the fresh lease deeds which have to be executed after the 20 years i.e. have to be executed only after the expiry of the previous period of 20 years and not before that;

(v) the lease is for the specified purpose of enabling the tenant to make his building thereon. The nature, type, kind and extent of the building has been left exclusively to the discretion of the tenant which is not fettered in any manner;

(vi) the presumption of a lease of this type being only for the lifetime of the lessee is also ousted by providing in clause 10 of the agreement that the heirs, successors and legal representatives of the parties would also be bound by the terms of the lease;

(vii) if it was intended to leave it open to the landlord to agree to the renewal of the lease or not there was no sense in providing that the rate of rent would not be liable to be increased after the expiry of 20 years. Even without providing a renewal clause it is always open to parties to a lease deed to renew a lease after it has expired by the efflux of time. Clauses relating to option to renew are usually contained in leases when option is given to one side and not to the other or if certain changes in the terms of the lease are envisaged at the time of renewal. In the instant case if the lease was to be renewed for any number of periods of 20 years no option at all is given to any of the parties to change any of its material terms;

(viii) the tenant has been given the authority even to alienate, sell or mortgage his rights in the leasehold as well as in the superstructure that he may make thereon. Normally such rights are not conferred in case of short-term lease.

7. I do not think, the learned Senior Sub-Judge was justified in ousting the defence of the tenant in this case on the ground that he has not pleaded specifically in his written statement that the lease exhibit P. 1 was a perpetual one. Although he denied his liability to ejectment and claimed that the suit should be dismissed and referred to the lease deed, its terms and conduct of the parties, it was not necessary for him to use any particular expression as the label for the lease. Nor is it necessary for the Court to say that it is perpetual lease. All that a proper construction and interpretation of the lease deed exhibit P. 1 shows is that the tenant is not liable to ejectment in terms thereof even after the expiry of the first period of 20 years.

The reason for the recalcitrant attitude adopted by the landlord is obvious. Rates of land and their possible utility in Yusaf Sarai have immensely gone up during the last quarter of a century. Yusaf Sarai was merely a village near Delhi in 1941. It could not even be properly called a suburb of Delhi at that time. Now it is a part of the Municipal Corporation of Delhi and enjoys a coveted position in South Delhi. But howsoever unfortunate it may be for the landlord he is bound by the terms of the lease which have already been interpreted by me to disentitle him to claim ejectment of the tenant after the expiry of the initial period of 20 years. Though it is not necessary to go into the reason why the period of 20 years was at all fixed in the deed of lease though it was clearly intended to be in perpetuity, it appears to me that this was possibly in order to save some petty amount on account of the difference in the stamp duty which would be payable for ft lease which purports to be for a term in excess of three years on the one hand and a lease which purports to be in perpetuity. In the former case the stamp duty is payable on a conveyance for a consideration equal to the average annual rent. In the case of a lease in perpetuity the stamp duty on a conveyance is payable for consideration equal to one-fifth of the whole of the amount of the rent which would be payable for a period of 50 years on the lease.

In Abdul Karim Patwari v. Abdul Rehman, (1912) 18 Ind Cas 364 (Cal.) a Division Bench of the Calcutta High Court held that the effect of the clause for the grant of a new lease upon the expiry of the term was to prevent the landlord from seeking to eject the tenant upon the expiry of the term of 9 years mentioned in the lease. Whatever be the purpose of expressing the intention of the parties in the manner in which they did in exhibit P. 1 there is no doubt that the parties never envisaged ejectment of the tenant from the plot in question after the expiry of the first 20 years.

8. Mr. Iqbal Krishan, the learned counsel for the tenant has also referred me in this connection to the following passage in 'Foa's General Law of Landlord and Tenant' (7th Edition) at page 304 (Article 457) :--

'What amounts to a covenant for perpetual renewal :-- The covenant, though not in terms for perpetual renewal, may contain expressions from which an intention to that effect may be inferred, e. g. where it stipulates that the lessor and his successors should 'continue the renewing' of the lease to the lessee and his successors, or that they should renew to them 'always at any time' upon request or even (as it has been held) where the covenant is to grant such further lease under the same rent and covenants as should by the lessee be desired.'

9. Even where it was specified that on renewal the rate of rent could be increased it was held by a Division Bench of the Calcutta High Court in Ali Mohammad v. Nayan Rajah Bhuiya, (1912) 13 Ind Gas 912 (Cal.), that the stipulation for renewal was not in contravention of the terms of the Bengal Tenancy Act and that the tenant could not eject the sub-tenant without giving him an option to take a fresh lease at a fair rent.

10. Regarding the observations of the learned Additional Senior Sub-Judge suggesting the filing of a suit for specific performance of the agreement of renewal of lease by the tenant against the landlord the learned counsel for the tenant-appellant has made a reference to the judgment of the Calcutta High Court in Secy. of State for India in Council v. A.H. Forbes, (1912) 17 Ind Cas 180 (Cal), wherein it was observed, inter alia, as follows :--

'In so far as the third question is concerned, it cannot be seriously doubted that the position of the lessee who has been always ready and willing to accept a renewal on proper terms is the same in equity as if a proper lease has been granted. The covenant for renewal was still specifically enforceable at the commencement of the suit, and the position of the defendant in equity is the same as if it had been specifically enforced;'

11. I am in respectful agreement with the above quoted observations of the Calcutta High Court and I think, this lays down the correct state of law. If a person entitled to obtain possession by a suit for specific performance is already in possession of the property and is sought to be ejected by the other party to the covenant which is suggested to be specifically enforceable it may not be fair to direct the person in possession to file a suit for enforcing his rights and denying him the liberty of claiming to continue in possession as a defence in a suit for ejectment in exercise of the same right.

12. Mr. Madan Bhatia, the learned counsel for the respondent landlord referred to the judgment of the Madras High Court in District Board of Tanjor v. Vythilinga Chetty, AIR 1916 Mad 1224(1), and argued that a covenant by a landlord to renew even if legally enforceable against him cannot be pleaded as a bar to a suit for possession brought by the landlord on the expiry of the term mentioned in the lease deed as a promise to renew is not a promise not to eject. The judgment in the above-mentioned case is very brief and it is not possible to get any idea about the terms of the lease which their Lordships of the Madras High Court were construing in that case. It is not even known whether it was a lease for building purposes or for any other purpose. Nor are the other terms of the lease disclosed in the judgment. The judgment in the case of District Board of Tanjore, AIR 1916 Mad 1224 (1) appears to be based on the particular facts of that case and the ratio of that Judgment cannot be invoked in the instant case. Ultimately every case depends on its own facts and the question which calls for decision before me depends on the true and correct construction and interpretation of the particular lease deed before me. I am, in the circumstances of this case, inclined to think that the suggestion of driving the tenant to a suit for specific performance is misconceived and the tenant was entitled to take up the same plea as a defence in this case and to claim that in terms of the lease he was not liable to ejectment.

13. In Chapsibhai Dhanjibhai v. Purshottam Motilal, AIR 1964 Bom 287, it was held that ordinarily a lease which provides that the lessee will continue so long as he pays the rent will be construed to be a lease for the lifetime of the lessee but there may be terms in the lease deed suggesting that the lease was heritable in which case, on a proper construction of the document, the Court is free to come to the conclusion that the lease is a permanent one. The Bombay High Court also referred to the presumption about a tenancy for building purposes being either for the lifetime of the lessee or being a permanent tenancy and in no case being a tenancy at will. In the Bombay case the lease purported to be for a period of 30 years. Considering the terms of the lease it was held by the Bombay High Court that since the lease deed showed that it was (a) a lease for building purposes, (b) it was to enure, in the first instance for a period of thirty years, (c) the lessee has a right to continue to enjoy all the rights under the lease even after the expiry of the initial period of thirty years, (d) the rent was fixed and the lessor had no right to increase it in any manner, (a) the rights of the lessee were heritable and transferable and the lessee was allowed to construct a pucca structure thereon and even after the death of the original lessee his heirs were allowed to continue without demur and rent was accepted from them, the lease was intended to be a permanent one.

14. The judgment of the Bombay High Court appears to be on all fours with the instant case. In mat case the tenant's suit for restraining the landlord to eject the tenant after the expiry of the lease was decreed by the High Court.

15. The next argument of Mr. Madan Bhatia, counsel for the landlord is that the lease under which the tenant claims to continue in possession after the expiry of the first period of 20 years is not in writing and not registered and cannot, therefore, be taken notice of because of the provisions of Section 107 of the Transfer of Property Act as this case does not fall within the exception to the rule contained in Section 53A of that Act. He has referred in this connection to the judgment of the Privy Council in Ariff v. Jadunath Majumdar, ILR 58 Gal 1235: (AIR 1931 PC 79), and has argued that whatever be the rights of the tenant he is not entitled to claim a tenancy of the plot in question so long as a fresh lease deed is not executed in his favour. The facts and circumstances of the Calcutta case were entirely different and I do not think, the judgment in that case is of much assistance to the landlord in the present case.

Once it is held that the registered lease deed exhibit P. 1 is intended to operate in perpetuity no question of invoking the provisions of Section 107 by the landlord or of claiming protection of Section 53A of the Transfer of Property Act by the tenant can arise. I have already held above that the lease deed exhibit P. 1 is intended to operate in perpetuity, I need not deal with judgment of the Madras High Court in Gopalan Nair v. Kunhan Menon (1907) ILR 30 Mad 300 as the same was based on the construction of the particular lease deed which was before their Lordships of the Madras High Court in that case. Unless the terms of the lease are almost same or similar it is not safe to rely on the construction placed on one document for the interpretation of another. All the relevant terms in the lease deed exhibit P. 1 appear to me to be almost same or similar to those in the case decided by the Bombay High Court reported in AIR 1964 Bom 287 (referred to above).

16. Mr. Madan Bhatia has lastly referred to some passages from 'Woodfall on Landlord and Tenant' and argued on that basis that the tenant has no right in the property so long as a lease deed is not executed in his favour and that his personal right to claim renewal of the lease cannot entitle him to refuse to hand over possession of the plot to the landlord. For the , reasons given by me in connection with the argument of the learned counsel based on Section 107 of the Transfer of Property Act there is no force in this argument.

17. No other point was argued before me in this case by the counsel for the parties. In the circumstances explained above this appeal is allowed and the decree of the first appellate Court is reversed and for that is substituted the decree of the trial Court dismissing the suit of the landlord with costs. The parties will, however, bear their own costs of this appeal.

18. At the oral request of Mr. Bhatia, certificate under Clause X of Letters Patent granted.


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