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Banwarilal Sharma Vs. Ram Swaroop - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtRajasthan High Court
Decided On
Case NumberCivil Reference in Civil Revn. No. 389 of 1968
Judge
Reported inAIR1974Raj178; 1974(7)WLN192
ActsTransfer of Property Act, 1882 - Sections 4, 105 and 107
AppellantBanwarilal Sharma
RespondentRam Swaroop
Appellant Advocate P.C. Bhandari, Adv.
Respondent Advocate R.P. Dave, Adv. for; M.M. Tewari, Adv.
DispositionPetition allowed
Cases ReferredRam Kumar v. Jagdish Chandra
Excerpt:
.....the right of enjoyment of immovable property is effected and is accepted by the other party is a lease document and the substance of the matter must be looked into and not merely the form thereof.; it is of little significance as to what language has been employed in the document so long as it embodies all the essential conditions of lease, as it is the substance thereof, which is material and not merely the form.;(c) transfer of property act - section 105--lease--it is a bilateral transaction a lease could be effected only by a bilateral transaction in which both lessor and lessee should be parties. in this view of the matter, it would not be right to hold that the lessor is the only person entitled to make a transfer of the right to enjoy immovable property and he alone should..........the right of enjoyment of immovable property is effected and is accepted by the other party is a lease document and the substance of the matter must be looked into and not merely the form thereof.6. there is no doubt that a lease is a transfer of a right or interest in immovable property and such a transfer could only be effected by a contract between the lessor and the lessee. therefore, a lease could be effected only by a bilateral transaction in which both lessor and lessee should be parties. in this view of the matter, it would not be right to hold that the lessor is the only person entitled to make a transfer of the right to enjoy immovable property and he alone should execute the document of lease, for instance a mere 'patta' issued by the landlord would not constitute a lease......
Judgment:

Gupta, J.

1. The plaintiff, who claims to be the owner of the premises consisting of a room and a tin shed situated in 'C' Scheme in the city of Jaipur, alleged that he had let out the premises to the defendant on April 1, 1957, on a monthly rent of Rs. 4/- and a rent-deed was executed in respect of this tenancy by the defendant in favour of the plaintiff on April 1, 1957. As the defendant did not make payment of the rent from August 1, 1962, the plaintiff filed a suit on August 27, 1965, in the Court of Judge. Small Causes, Jaipur City, for the recovery of Rs. 144/- as arrears of rent @ Rs. 4/- per month and Rs. 9/- as house tax, in all for Rs. 153/-.

2. The defendant resisted the suit and denied the execution of the alleged rent deed by him in favour of the plaintiff and also took the defence that the alleged rent-deed was an unregistered document and as such was inadmissible in evidence for want of registration. TheJudge, Small Cause, Jaipur City, by his order dated March 3, 1966 held that the alleged rent-note was a simple 'Kirayanama' and was admissible in evidence. Thereafter by his judgment dated April 13, 1968, the learned Judge held that the execution of the rent-deed Exhibit. 1 by the defendant was proved and holding that the relationship of landlord and tenant between the parties was established from the aforesaid document and that the defendant was the plaintiff's tenant on a monthly rent of Rs. 4/-, a decree for Rs. 144/- with costs, in respect of arrears of rent was passed in favour of the plaintiff and against the defendant. It was further decided that as no agreement was proved between the parties in respect of the payment of house tax, the suit for the recovery of house tax was not maintainable and as such the claim for the recovery of house-tax was disallowed.

3. The defendant filed a revision petition in this Court against the decree passed by the learned Judge, Small Cause Court, Jaipur City and the finding of the trial Court about the existence of the relationship of landlord and tenant between the parties was assailed on the ground that the said finding was based solely upon the so-called rent-deed Ex. 1, but that document was inadmissible in evidence for want of registration. It was submitted on behalf of the applicant that the document Ex. 1 was no doubt executed by the tenant-applicant, but as it was signed by the plaintiff landlord also, in token of his acceptance thereof, it was a lease deed within the meaning of Section 107 of the Transfer of Property Act and as it was an unregistered document, it was not admissible in evidence and did not confer any right or interest. Although the matter in question was the subject-matter of four decisions given by three learned Judges of this Court sitting singly Bhargava, J., before whom the revision petition came up for hearing, thought that the matter was of considerable importance and required an authoritative decision by a Division Bench, made a reference to the Division Bench and it is in this way that the matter has come UP before us.

4. It has been contended by the learned counsel for the tenant-applicant before us that as the document Exhibit 1 bears the signatures of both the tenant and the landlord, it was a bilateral agreement of tenancy and under the second clause of Section 107 of the Transfer of Property Act, it required registration and in the absence thereof, the said document was inadmissible in evidence and no rights flowed from it. On theother hand it was contended by the learned counsel for the landlord opposite party that the document in question was essentially a unilateral one which was executed by the tenant alone and it was only a 'Kirayanama' (rent-note) or a Kabuliyat and mere signature of the landlord, even if it be in token of his acceptance of the terms of the rent-note, could not be considered as execution of the said document by the plaintiff-landlord. He further submitted that the said rent-note was only for a period of 11 months and contained a stipulation for payment of monthly rent for the premises in question and as such it did not come within the definition of a lease-deed and, therefore, did not require registration.

5. We have considered the rival contentions. Section 105 of the Transfer of Property Act lays down that a lease of immovable property is a transfer of a right to enjoy such property, made for a certain time, or in perpetuity, in consideration of a price paid or promised, to the transferor by the transferee, who accepts the transfer on such terms. Thus, what Section 105 requires for constituting a lease is a contract for transfer of the right to enjoy immovable property for consideration. A lease is essentially a transfer of an interest in immovable property entitling the lessee to the enjoyment of such immovable property, which includes the right to possession thereof. Another essential feature of a lease is that the transfer must be for consideration, though it may be for a limited period or in perpetuity. A document by which such transfer of the right of enjoyment of immovable property is effected and is accepted by the other party is a lease document and the substance of the matter must be looked into and not merely the form thereof.

6. There is no doubt that a lease is a transfer of a right or interest in immovable property and such a transfer could only be effected by a contract between the lessor and the lessee. Therefore, a lease could be effected only by a bilateral transaction in which both lessor and lessee should be parties. In this view of the matter, it would not be right to hold that the lessor is the only person entitled to make a transfer of the right to enjoy immovable property and he alone should execute the document of lease, For instance a mere 'Patta' issued by the landlord would not constitute a lease. As a matter of fact a unilateral document executed either by the lessee alone or by the lessor alone would not be capable of constituting a lease of immovable property, as it requires two parties to make a contract. However, as we have observed above, it is of little significance as to what language has been employed in the document so long as it embodies all the essential conditions of lease, as it is the substance thereof, which is material and not merely the form. So long as all the essential requirements of a lease, as defined in Section 105 of the Transfer of Property Act, are fulfilled and the document is signed both by the lessor and the lessee and it incorporates the recital as to the property demised thereby, the period of the lease and the consideration therefor, it would no doubt be a document of lease. If the essential conditions of a lease are fulfilled, the manner in which the parties thereto chose to describe the document, is absolutely immaterial. Even if a document is written by one party in favour of the other so that from its outward form it appears to be a unilateral document, if the other party to the contract puts his signature on the said document in token of his acceptance of the terms contained therein, it would amount to the execution of the document by both the parties and such an instrument would substantially be bilateral in nature and effect. In the present case the document Ex. 1, which is on a printed form, although styled as a 'Kirayanama' (rent-deed) and purports to have been written by the tenant in favour of the landlord, it enumerates all the requisite terms and conditions constituting the lease of the premises in question, including the period of the demise and the consideration therefor, namely, the monthly rent for which the said premises were let out. However, it is of little consequence that such recitals have been made on behalf of the tenant because the document contained a specific recital at the end that the terms and conditions mentioned in the document are acceptable to the landlord (Malik Makan ko bhi Kirayanama Likhit Sharayat Manjoor Hai). After all these recitals, including the one mentioned above, the document purports to have been signed both by the tenant as well as by the landlord and their signatures have been attested by two witnesses. Thus, it incorporates all the necessary ingredients of a document of lease and must be considered to have been duly executed by both the lessor as well as the lessee. Ex. 1, therefore, constitutes a lease-deed within the meaning of Section 105 of the Transfer of Property Act. Such a position was accepted in this country as early as in the year 1881, when on a 'darkbast' submitted by the tenants for a lease of immovable property, embodying specified terms, the landlord had written the words 'granted' on the margin and affixed, his signature thereon, a Full Bench of the Calcutta High Court held the document to be a lease deed. Sir Richard Garth, Chief Justice, delivering the judgment of the Full Bench in Syed Sufdar Reza v. Amzad Ali, (1881) ILR 7 Cal 703 (FB) made the following observation:--

'If the application of the defendants was accepted, by the plaintiff by writing the word 'granted' in the margin, we think that theinstrument in question was a lease, and therefore required registration.'

We do not think that the law laid down in Sufdar Reza's case (1881) ILR 7 Cal 703 (FB), cited above, has ever since been departed from or even doubted.

7. Now Section 107 of the Transfer of Property Act provides that a lease of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent, can be made only by a registered instrument and further that all other leases of immovable property may be made either by a registered instrument or by oral agreement accompanied by delivery of possession. Thus, leases coming within the ambit of second paragraph of Section 107, include all other leases which are for a period of one year or less and in which the rent agreed upon is not yearly. Such leases, if they are reduced to writing, must be effected by a registered document. An unregistered document of lease, in cases where the lease is required to be registered, conveys no title and creates no rights in the lessee and cannot be used in evidence to prove the transaction of lease or any terms thereof. In the present case as we have observed above, the document Ex. 1 fulfills all the necessary requirements of a lease, as it purports to have been executed both by the lessor and the lessee and contains all the essential terms and conditions of lease and is for a period of 11 months, reserving monthly rent, as such, it could have been effected only by a registered instrument, as required by the second paragraph of Section 107 of the Transfer of Property Act. As the document Ex. 1 is admittedly not registered, it was clearly inadmissible in evidence and no rights could have flown from such an unregistered, document nor it could have been used in the present case for the purpose of proving the relationship of landlord and tenant. In view of Section 4 of the Transfer of Property Act, the provisions of Section 107 thereof arc to be read as supplemental to those of the Registration Act. The effect of these provisions read together, therefore, is to exclude all unregistered leases, which have been reduced to writing, from evidence.

8. We may also observe here that the view expressed by us above has also been taken in four cases decided by other learned Judges of this Court, though sitting singly, In Madanlal v. Noor Mohd. 1968 Raj LW 334, Shinghal, J., held that so long as the essential requirements of a transaction of lease are fulfilled, it is immaterial, if any or all of them, are narrated in the beginning of the instrument evidencing the transfer, or in the middle, or towards the end thereof. The document, which was under consideration before the learned Judge, was a printed one of the same type as the document Ex. 1 in the present case and he also came to the conclusion that as the instrument of transfer hadthe effect of transferring a right to enjoy the premises to the lessee and contained stipulations regarding the period of the transfer and the consideration therefor, it amounted to a lease, and was compulsorily registrable. Similar documents were also examined by other learned Judges of this Court in Rood Mal v. Rajendra Nath, Civil Revn. No. 214 of 1966 decided on 11-3-1968 (Raj), Chittar Khan v. Raja Harnath Singh, Civil Revn. No. 462 of 1967 decided on 13-8-1968 (Raj) and Bhagwandass v. Durga Prasad, Civil Revn. No. 362 of 1967, decided on 18-12-1967 (Raj) and all of them also came to the same conclusion.

9. In our opinion where a statute has been construed in one manner and the interpretation has been consistent, it should not be readily departed from. The reasons are not far to seek as on the basis of such an interpretation numerous problems must have been solved and questions answered and even if subtility or learning tempt one to doubt the view already adopted, dictates of certainty should forbid such a course, as departure from a well established course of construction is likely to create a doubt to dispel which is the plain duty of courts. Unless, therefore, an interpretation is unfair or manifestly unjust, it should not be disturbed. Any practice or inclination to the contrary would work hardship and confusion in regard to rights and remedies and the sacred institution of law, instead of serving justice, will serve speculation and hair splitting. The doctrine of 'stare decisis', in our opinion, acquires its sanctity from these considerations.

10. The argument which probably might have impelled Bhargava, J., to make the reference appears to be that in his view a lease of immovable property, being a transfer of the right to enjoy such property, could only be effected by the lessor, who was the person entitled to transfer such a right and that the lessee was not competent to transfer a right to enjoy such immovable property. However, as we have explained above, such a proposition is untenable and was also rejected by Garth, C. J., in the case of Syed Sufdar Reza, (1881) ILR 7 Cal 703 (FB), referred to above. The learned Judge tried to derive support for the proposition from the observations of P.N. Mookerjee, J., in Dip Narain Singh v. Kanai Lal Goswami, (1960) 64 Cal WN 293. We may, however, observe that the matter before the Calcutta High Court in that case related to a registered Kabuliyat which was for a period exceeding one year. It was held in that case that a unilateral Kabuliyat for a period exceeding one year, even though it be a registered one and 'even though it be accepted by the landlord orally or by writing unregistered', could not create a lease under the provisions of the Transfer of Property Act. In that case a unilateral Kabuliyat for a period of four years was executed by the tenant alone andalthough it was a registered document, it was certainly incapable of constituting a deed of lease within the meaning of Sections 105 and 107 of the Transfer of Property Act. What P.N. Mookerjee, J., desired to emphasise in that case was that even though such a registered Kabuliyat might have been accepted by the landlord orally or by an unregistered document, it would not constitute a lease. The reason is very simple. The first paragraph of Section 107 of the Transfer of Property Act provides that a lease of immovable property for a period exceeding one year, can only be made by a registered instrument signed and executed by both the parties. Further the third paragraph of the aforesaid Section provides that if there are more than one instrument, constituting the lease of immovable property, then each such instrument should be executed both by the lessor and the lessee. Thus, even a registered Kabuliyat, which is essentially a unilateral document executed by the lessee only, by itself, could not constitute a lease within the meaning of Section 107 of the Transfer of Property Act and an oral acceptance thereof by the landlord or an acceptance in writing by the landlord by means of a separate unregistered document could not be of any avail, as it would not alter or improve the position. The requirement of the law can only be satisfied when the document in question itself is signed by both the parties, namely, the landlord and the tenant and it would be completely useless if the tenant alone has signed the registered Kabuliyat, while the landlord executes a separate unilateral unregistered document in token of his acceptance of the same. In the case before us the facts are absolutely different inasmuch as the very same document Ex. 1, which embodies all the terms and conditions of a lease, is signed by both the lessor as well as the lessee.

11. Learned Counsel for the opposite party also relied upon certain observations made by their Lordships of the Supreme Court in Asa Ram v. Mst. Ram Kali, AIR 1958 SC 183. In that case the argument advanced was that as the landlords had not executed the lease deed, the lessee could not claim the status of a tenant solely on the strength of a Kabuliyat executed by them. Their Lordships observed that as the landlords had given evidence that they accepted the Kabuliyat and received rent as provided therein, there was no substance in the objection that there was no valid contract of lease between the parties. In that case also the document in question was a registered, but unilateral one, executed by the lessee alone in favour of the landlords and as it was not signed by both the parties to the contract, it was a mere Kabuliyat and by itself it was insufficient to constitute a contract of lease, but there was other evidence to show that the landlords had accepted the Kabuliyat inasmuch as the lessee had paid rent, which was duly received and accepted by the landlords.Thus in that case also their Lordships of the Supreme Court did not hold that the relationship of landlord and tenant could be established on the strength of a mere Kabuliyat, but their Lordships considered other evidence relating to the payment and acceptance of rent to arrive at a finding as to the existence of a contract of lease between the parties. It is a settled proposition of law that a contract of tenancy may be inferred from payment and acceptance of rent by a person in possession to the owner of the premises. Reference in this connection may be made to the decision of their Lordships of the Supreme Court in Ram Kumar v. Jagdish Chandra, AIR 1952 SC 23. In that case also their Lordships held that even a registered Kabuliyat executed by the tenant did not bring into existence an operative lease. However, their Lordships also held that from the facts, that the defendants remained in possession of the land belonging to the plaintiff with permission and paid rent, a tenancy could be fairly presumed. Thus neither the case of Dip Narain Singh (1960) 64 Cal WN 293 nor that of Asaram, AIR 1958 SC 183 relied upon by the learned Counsel for the landlord-respondent, supports his contention that a document like the one before us which embodies all the essential terms and conditions of a lease and which is signed by both the parties to the contract, namely, the lessor and the lessee, did not constitute an instrument of lease within the meaning of Section 105 read with Section 107 of the Transfer of Property Act and was admissible in evidence. It would not be out of place to mention here that both in Dip Narain Singh's case (1960) 64 Cal WN 293 and in Asaram's case AIR 1958 SC 183, their Lordships were dealing with registered Kabuliyats and as such no question about their admissibility in evidence arose, but the only matter for consideration was as to whether unilateral Kabuliyat's executed by the lessee could constitute a document of lease.

12. We, therefore, hold that Ex. 1 is a document of lease within the meaning of Sections 105 and 107 of the Transfer of Property Act and as such it required registration and in the absence thereof, it is inadmissible in evidence and could not have been looked into for arriving at a finding regarding the existence of relationship of landlord and tenant between the parties to the suit. The trial Court should have excluded the said document Ex. I from consideration, as it is inadmissible in evidence.

13. We, therefore, allow the revision petition, set aside the decree passed by the Judge, Small Causes, Jaipur City, dated April 13, 1968, and remand the case to the trial Court with the direction to decide it afresh, after excluding the document Ex. 1 from consideration.

14. The parties are left to bear their own costs of the revision petition.


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