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Narasram Naraindas Alias Purshotamdas Vs. R. Venkataswami Naidu and ors. - Court Judgment

LegalCrystal Citation
SubjectTenancy
CourtChennai High Court
Decided On
Reported in(1963)1MLJ140
AppellantNarasram Naraindas Alias Purshotamdas
RespondentR. Venkataswami Naidu and ors.
Cases ReferredProtection Act. In Irani v. Chidambaram Chettiar
Excerpt:
- .....law, of landlord and tenant in regard to tenants having and not having rights to build on the property leased out to them. where a lease of land expressly permits the tenant to put up buildings thereon there is no difficulty; but on eviction the tenant can only remove the building.6. where a land is let out to a tenant and there is no (express or implied) prohibition against his putting up (either expressly or by implication) a superstructure thereon, the tenant can enjoy the land in all lawful ways; he can put up a building as he will be in lawful occupation of the land, so long as the lease subsists. such an act on his part would not amount to trespass. when, however, the lease is terminated, the tenant will have a right to remove the superstructure (see section 108(h)) of the.....
Judgment:

S. Ramachandra Iyer, C.J.

1. The question that arises for consideration in this appeal which is filed against the judgment of Anantanarayanan, J., is whether a tenant of land in an area to which the Madras City Tenants Protection Act, 1931 applies, can be given the benefit of that enactment in respect of a building put up by him on the land where the lease deed in his favour expressly prohibits him from putting up any superstructure.

2. The appellant is the owner of a site measuring about 19 1/2 cents in Cross-cut Road, Tatabad, Coimbatore Town. He granted a lease of the property on 10th February, 1953 in favour of respondents 1 and 2, whom we shall hereafter refer to as tenants, for a period of one year, expressly stipulating that the tenants should not put up a superstructure on the property nor even sublet the same. There was, however, no provision for re-entry or forfeiture in case of breach. It must therefore be taken that the term in the lease-deed imposing an obligation on the tenants not to build or sub-let was only a covenant and not a condition, the breach of which would entail forfeiture. The tenants did not surrender possession at the and of the period. They continued in possession. It is reasonable to presume that the landlord assented to their continuance on the same terms as before. But the tenants committed breach of both the covenants; they put up a superstructure on the land and they also sublet the same to respondents 3 to 7, who made their own additions to the building.

3. The appellant-landlord then came to the Court with a suit to recover vacant possession of the property and for certain other reliefs. That was on 4th December, 1956. Certain defenses were raised to the action. Issues were framed, and, after the suit was set down for trial, and indeed, when the trial was partly done, a new situation arose. The Madras City Tenants' Protection Act, 1921, as amended by Act XIX of 1955, which we shall hereafter refer to as the Act, Was extended to the town of Coimbatore by a notification made by the Government. Under Section 9 of the Act, it will be open to a tenant of land, as defined in the statute, within a month of its coming into force to apply to the Court to direct the landlord to sell the land to him. Respondents 1 and 2 promptly took advantage of that provision and filed LA. No. 295 of 1958 for directing the appellant to sell the land to them.

4. The trial Court accepted the application, ascertained the value of the land in the manner prescribed by Section 9, and passed a preliminary decree, directing the tenants to deposit the money into Court. The landlord filed an appeal against that decree. The learned Subordinate Judge, Coimbatore, concurred with the Trial Court on the question relating to the right of the tenants to obtain a conveyance; but he held that, as under the Act the tenants would not be entitled to the conveyance unless the price was deposited within the time fixed by the Court, it was not appropriate to pass a preliminary decree, but that, on the other hand, the Court should only adjourn the case to see whether the tenants would pay the price, and, if they failed to do so, to proceed with the suit. This conclusion led to an order of remand of the suit for fresh disposal. The landlord (appellant) contested the order of remand on the question of the right of tenants to purchase the property, by appealing against the order of remand passed by the learned Subordinate Judge. Anantanarayanan, J., before whom the appeal came, affirmed the view, taken, by the lower appellate Court. The learned Judge held that as in the definition of the term ' tenant' under the Act, on whom the subsequent sections conferred certain benefits, no distinction was made between one who lawfully put up a building on the demised property and one who did so against the will of the landlord, Section 9 would apply to the case. The appeal was therefore dismissed. The judgment of the learned Judge is reported in Narasram Naraindas alias Purushotamdas v. Venkataswami Naidu and Ors. : (1960)2MLJ328 .

5. In this appeal against the judgment of Anantanarayanan, J., it has been contended for the landlord that the Act was not intended to apply, and, indeed, will not apply, to cases of tenancies of land where the tenant has been expressly prohibited from putting up a superstructure on the property. In order to appreciate the contention, it is first necessary to refer to a few relevant provisions of the Act. The Act was enacted with a view to give protection to certain classes of tenants. Its Preamble states:

Whereas it is necessary to give protection to tenants, who in municipal towns and adjoining areas in the State of Madras have constructed buildings on others' lands in the hope that they would not be evicted so long as they pay a fair rent for the land;

Essentially speaking, the Act confers three benefits on the tenant. They have been set out in Sections 3, 9 and II. A tenant, on whom the benefits have been conferred by the Act, has been defined thus:

'Tenant' in relation to any land means a person liable to pay rent in respect of such land under a tenancy agreement, express or implied;....

Section 3 declares that a tenant on ejectment will be entitled to be paid as compensation the value of any building put up and improvements, if any, made by him on the land. Section 9 provides that a tenant entitled to compensation under Section 3 will be entitled to purchase the land when a suit for ejectment is filed against him or within a particular period after the coming into force of the Act, provided he files the application within the time specified therein. The Act also makes provision in Section 11 for a special period of notice (three months) in case the landlord wants to evict the tenant. It will be seen that there is no express provision in the Act limiting the operation of Sections 3, 9 and 11 to tenants who were authorised by the terms of the lease to put up a building. Prima facie, therefore, the term 'tenant' might not exclude one who puts up a superstructure on the land in breach of a covenant not to build. But the definition is only a key to the understanding of the Act, and, if the Act, does not comprehend certain classes of cases or does not touch contracts or stipulations not to build on the land, the very general words used in defining the word 'tenant' cannot enlarge its scope. What has therefore to be ascertained is whether the statute read as a whole or any one of its provisions affords a clue to its scope. Before we deal with that matter, it will be useful to refer first to the position, under the ordinary law, of landlord and tenant in regard to tenants having and not having rights to build on the property leased out to them. Where a lease of land expressly permits the tenant to put up buildings thereon there is no difficulty; but on eviction the tenant can only remove the building.

6. Where a land is let out to a tenant and there is no (express or implied) prohibition against his putting up (either expressly or by implication) a superstructure thereon, the tenant can enjoy the land in all lawful ways; he can put up a building as he will be in lawful occupation of the land, so long as the lease subsists. Such an act on his part would not amount to trespass. When, however, the lease is terminated, the tenant will have a right to remove the superstructure (see Section 108(h)) of the Transfer of Property Act). He will have an obligation to give back possession of the land in the condition in which it was given to him. The landlord will not be obliged either to pay compensation to the tenant for the building or take the same for himself unless he chooses to do so.

7. Where, however, the terms of the lease prohibit expressly the tenant from building on the land, the landlord would be entitled to enforce the covenant at all times, for example, he can obtain an injunction from Court, preventing the tenant from putting up any building in breach of the conditions of the lease. Even if the tenant were to put up a building, the lessor, so long as he has not precluded himself by any estoppel or by acquiescence, will be entitled to obtain an order from Court for removal of the building which has been put up in breach of the covenant in the lease and against the will of the landlord vide Chhedi Manjhi v. Mahipal Bahadur A.I.R. 1951 Pat. 600. To enable him to obtain the relief, he need not terminate the lease.

8. Even if he is precluded from obtaining any relief by way of demolition of the superstructure during the currency of the lease, (for example, by reason of estoppel on his part, etc.) the nature and the duration of the lease will not be changed on that account. The tenant will have to remove the: superstructure on the termination of the lease and at the time of eviction.

9. The question then arises whether the protection afforded by the Act applies to the first two alone or all the types of cases set out above.

10. There is no provision in the Act which expressly renders illegal a stipulation not to erect a building. Section 12 refers to certain agreements as not binding on the tenant. It says:

Nothing in any contract made by a tenant shall take away or limit his rights under this Act, provided that nothing herein contained shall affect any stipulations made by the tenant in writing registered as to the erection of building, in so far as they relate to buildings erected after the date of the contract.

Two observations relevant to the present discussion fall to be made on the terms of the section. What the section prohibits is a contract or stipulation which disentitles the tenant from claiming any of the rights given to him under the Act, or, in any way limiting such rights. The rights given by the Act, as stated earlier, are : (1) to obtain compensation for a building put up by him at the time of eviction; (2) an option of purchasing the land in certain circumstances; and (3) three months' notice before eviction. Taking the first of the above benefits, a contract under which the tenant agrees to give vacant possession by removing the superstructure will be hit at by Section 12. The Proviso to the section only saves contracts which regulate, for example, the size, cost, situation, etc., of the building to be put up by the tenant. In Ponnambala Achar v. Mani : (1958)2MLJ516 a lease-deed contained a promise by the tenant to surrender possession after removing the superstructure. The agreement, in effect, was to give up that benefit which the Act subsequently gave to the tenant. It was held to be of no avail. Again, in Vajrapuri v. New Theatres : (1959)2MLJ469 a similar view was taken. In both the cases, the lease permitted or contemplated the putting up of a superstructure, by the lessee. It was held that the contract to deliver vacant possession amounted to taking away the rights conferred by the Act and was therefore invalid. But, where there is a total prohibition against a tenant putting up any building on the land will that contract or stipulation be rendered void by Section 12 Where a contract says that the tenant should not build on the land, it is not the same thing as saying that he can build, but that he will have no compensation for the building in case he is evicted. The main part of Section 12 covers only the latter class of cases. The Proviso to the section expressly saves an agreement between the landlord and tenant concerning the erection of buildings; that has been interpreted to mean only stipulations regarding its size, costs, situation, etc. For example, it will be open to the parties to agree that the tenant shall not put up a building of a value in excess of Rs. 100. The agreement in such a case will not be hit at by Section 12; equally so, if the agreement were to stipulate that the building should be only on the fringes of the property. If such agreements can be held to be valid, we fail to see why parties cannot be allowed to agree that no building at all should be put on the property. It is implicit from Section 13 itself that the Legislature contemplated only cases where a building could be put up on the land, and not cases in which there was an agreement not to put up any building.

11. If a covenant not to build on the property, is a valid one and if as we stated earlier the landlord can enforce such a covenant and pray for the demolition of the the building even during the currency of the lease, we fail to see why, after the termination of the lease, he could not ask for the same relief. Stipulations in a contract between the landlord and his tenant, so long as they do not contravene any statutory provision, are enforceable and the prayer asking for vacant possession of land is nothing more than one for remedying the breach committed by building on the land and asking for possession of the land rendered vacant by the removal of the building.

12. It is, however, contended that, having regard to the wide terms of the definition, every tenant, of land, irrespective of the terms under which he obtained the lease, would be entitled to the benefits conferred under 'sections 3 and 9 of the Act. In this connection, reliance is placed on the decision in Kannammal v. Kanakasabai (1930) 61 M.L.J. 535 : I.L.R. 54 Mad. 845. That was a case where a tenant of land put up an inexpensive building (shed) and it was argued that, as the tenant would not have had any hope that he would not be evicted as alluded to in the Preamble to the Act, the protection given by it would not avail him then. This method of interpretation of restricting the enacting part of the Act by reference to the Preamble was discountenanced. The Act defined the ' building ' as including a hut and it could not obviously be said that there was an intention on the part of the Legislature to restrict the scope of that word. But it is clear that the Act was not intended to have universal application. For one thing, it is confined to the City of Madras, and certain other towns to which the Government would extend its provisions. It Would only apply to tenancies of land created before the coming into force of the Act. The Title and the Preamble to the Act indicate that only a certain class of tenants were the objects of legislation, i.e., those who built on the property in the hope that they would not be evicted. It is an accepted rule that neither the Title nor the Preamble can properly aid the construction of the operative terms of the statute when such terms are clear. But the position will be different if one has to ascertain the scope of an Act; that depends on the intention of the Legislature that enacted it. The Title and Preamble assume an importance in such a case, and they have always been referred to as useful guides to ascertain the scope and extent of operation of the Act. In Poppatlal Shah V. State of Madras : 1953CriLJ1105 Mukerjea, J., observed:

The Title and Preamble, whatever their value might be as aids to be construction of a statute, undoubtedly throw light on the intent and design of the Legislature and indicate the scope and purpose of the legislation itself. The Title and Preamble of the Madras Sales Tax Act clearly show that its object is to impose taxes on sales that take place within the Province, though these words do not necessarily mean that the property in the goods sold must pass within the Province.... The Legislature had in mind a sale in the Province of Madras, and, as these words occur in the Title and Preamble of the Act, it was not deemed necessary to repeat them in the definition or the charging section.

Accordingly, a meaning appropriate to the scope of the Act was given in that case to the definition clauses and limited operation to the charging section was also given, though by themselves both of them were of wide amplitude.

13. An almost similar situation arose before us with respect to the application of the Madras Indebted Agriculturists (Temporary Relief) Act V of 1954 in Arunachalam Chettiar v. Annamalai Chettiar (1961) 2 M.L.J. 587. The definition of the term 'agriculturists', who were declared entitled to the benefits conferred by that enactment, was wide enough to include the debtors owning lands outside the Madras State'. We, however, restricted the operation of the enactment, by having regard to its scope as stated in the Preamble, to only those debtors who had agricultural lands in the State.

14. Curgenven, J. himself has recognised this principle in Kannammal v. Kanakasabai (1930) 61 M.L.J. 535 : I.L.R. 54 Mad. 845 when he observed:

Now, in the present instance, if the Preamble had declared it necessary to protect a certain clearly defined class of tenants, it might be reasonable to hold that, although the text is silent, there was an intention so to restrict it; though even then the meaning of the Act would not be so clear as if the restriction had appeared in the body of it.

But one must recognise that, in the case of the Madras City Tenants Protection Act, neither the Preamble nor the Title indicates with certainty to what particular tenancies the Act was intended to apply. The utmost that can, be said in favour of the appellant's contention for a limited application of the provisions of the Act is that the Legislature intended it to apply to certain class of tenants only and that the general language used in the enactment should be restricted in its application only to those cases for which the Act was intended to apply. The question then is what are the classes of tenants to whom the Act was intended to apply If the words of the Preamble were to be taken, the persons who will get the benefit will be those who had put up buildings in the hope that they Would not be evicted so long as they paid the rent. These words are too vague to be taken as defining a definite ascertained class of tenants. We have next to look into the body of the Act itself to find out whether its operation is restricted to any particular class of tenants. We have held earlier that Section 12 does not prohibit the contract between the landlord and the tenant, by which the latter agrees not to build on the property. If such a contract is held to be valid, the statute cannot obviously apply to protect a tenant who was prohibited from putting up a building on the property. Notwithstanding, therefore, the wide terms of the definition of the term ' tenant' and also of Sections 3 and 9, it must follow that the benefits of the Act were not in undid to be conferred on those tenants where there is a stipulation between the landlord and tenant not to put up any building on the property. It was, however, contended on behalf of the respondents that there are observations to the contrary in the two Bench decisions of this Court. In the first of them, viz., Kannammal v. Kanakasabai (1930) 61 M.L.J. 535 : I.L.R. 54 Mad. 845 Bashyam Ayyangar, J., observed:

The area of the land, the period or the avowed purpose of the lease, the size or character of the building put up by the tenant, none of these or similar considerations are made to count for anything. Even if the tenant had erected the building without or against the consent of the landlord, the Act would appear to permit the former to acquire the land through its instrumentality.

In the second of them, viz., Vajrapuri v. New Theatres, Carnatic Talkies, Ltd. : (1959)2MLJ469 Ganpatia Pillai, J., delivering the judgment of the Bench, reiterates almost in identical words the same statement. But the observations in both the cases were purely by way of obiter. In the latter case, the learned Judge expressly points out that the case was not concerned

with the case of erection of buildings contrary to the stipulations contained in the written contract to which the tenant was a party.

Although the observations extracted above were merely by-way of obiter, they are undoubtedly entitled to great weight. But, after anxious consideration and for the reasons given already, we are unable to share the view expressed by the learned Judges on this aspect of the matter.

15. Mr. R. Ramamurthi Ayyar, appearing for the respondent, sought to support the claims of his clients to purchase the property on another ground as well. He contended that, as the original lease was only for one year and the restrictive covenants-should be deemed to have come to an end with that lease, the subsequent possession of the tenant should be referable to an oral yearly lease, in respect of which it had not been proved that there was any prohibition against putting up superstructure. This contention was not raised in any of the Courts below or before the learned Judge. There is no evidence of any fresh lease-agreement subsequent to the original lease. What all is known is that the lessees continued in possession and the landlord accepted the rent from them. It is well settled that, where a tenant holds over after the expiration of the period fixed by the original lease, he impliedly holds the property subject to the same covenants that were present in the old lease as applicable to the new situation as well. It is not even the case of the tenants that the landlord acquiesced in the putting up of the construction or encouraged them to do so. As the building was put up when the prohibitory covenants were in force, the tenants will not be entitled to protection under the Act.

16. But Mr. Ramamurthi Ayyar contends that, as in respect of the years subsequent to the time when the building was put up, the landlord must have been aware of the existence of the building, the presumed yearly lease thereafter should be regarded as permitting the building to be put up. The short answer to that argument is that there is no evidence of the grant of an actual lease every year. The tenant had merely held over after the termination of the old lease with the assent of the landlord. But, even if one were to accept the argument that there was this yearly lease in favour of the tenant, the lease of the site after the construction of the building will not amount to a lease of the land as such. The land by that time had become part of the building and it will then by a lease of the building. Such a lease will not be comprehended by the Madras City Tenants' Protection Act. In Irani v. Chidambaram Chettiar (1952) 2 M.L.J. 221 question arose whether a lease of the land, over which the tenant had lawfully put up a superstructure during the currency of an earlier lease, would be a lease of the land alone. The question was answered in the negative, it being held that the lease of a land when a superstructure was standing thereon was a lease of a part of the building. We have no hesitation therefore in rejecting this contention of the respondent. There is also one other matter to be referred to. By the very terms of the definition of the, word 'tenant', sub-tenants are excluded. The sub-tenants cannot therefore claim any rights in respect of the building put up by them. Nor can the tenant himself claim benefit in respect of the buildings put up by his own tenant. But, in the view we have taken of the case, it is unnecessary to pursue this matter any further. From what we have stated above, it will be clear that the respondents would not be entitled to an order under Section 9 for compelling a sale of the land to them by the appellant. The appeal is therefore allowed. The result is that there will be a remand of the suit to the trial Court for disposal on other issues.

17. The appellant will have his costs in this appeal.


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