Calcutta High Court
Ranjit Kumar Dutta vs Tapan Kumar Shaw And Another on 6 March, 1997
Equivalent citations: AIR1997CAL278, AIR 1997 CALCUTTA 278, (1997) 2 RENCR 636 (1997) 101 CAL WN 332, (1997) 101 CAL WN 332
JUDGMENT
1. This appeal has been assigned to me by the Hon'ble, The Chief Justice on difference of opinions of the Hon'ble Mr. Justice Babu Lall Jain and the Hon'ble Mr. Justice Sidheshwar Narayan.
2. The following two questions, were raised by the tenant/appellant in this appeal --
(i) Whether the lease, as per registered deed dated 8th of October, 1956 for an initial period of 15 years commencing from 1st of October, 1956 to 30th of September, 1971 fell short of 15 years so as to be governed by the West Bengal Premises Tenancy Act, 1956 and to entitle the tenant-appellant to the benefits secured under the said Act?
(ii) Whether the said lease would be deemed to have expired by efflux of time on the expiry of the initial period of 15 yearsin the year 1971 as the lease was not renewed by virtue of a registered deed and as such the defendant-appellants' continuing in possession of the demised premises thereafter and paying the rent wouldbe deemed to be holding over the same under S. 116 of the Transfer of Property Act, and accordingly the tenancy would be governed under the provisions of West Bengal Premises Tenancy Act, 1956?
3. Before finding out answers to the questions raised in this appeal it would be desirable to know the facts of the case which are as follows :--
A registered deed of lease dated 8th of October, 1956 was executed between plaintiff No. 1 and the defendant and by and under the said deed the defendant was holding as a lessee in respect of one room, privy and bath room in the ground floor. The lease was initially for 15 years commencing from 1st October, 1956 and terminating on 30-11-71 at a monthly rent of Rs.700/- payable according to English Calender with an option, on the part of the lessee to renew the same for a further period of 15 years. The lease also provided inter alia that if the lessee shall be desirous of having the lease hereby granted renewed for a further period of 15 years, the lessee shall at least three calender months before the expiration of the ierm thereby granted, give the lessor in writing notice of his intention to make such renewed lease and the lessor shall be bound to renew the same at the lessee's cost.
4. The said deed of lease (Ext. A0 also contains a clause that at the termination of the tenancy after the period of 15 years, or 30 years if the period be extended hereafter of this demised premises to yield up quite peaceful possession of the demised premises and the said privy and bath room in as good condition as the same are now reasonable and wear and tear and damage by fire, storm, earthquake, riot, political disturbances, violence of any army or mob, war or the consequences thereof, airraid or any irresistible force and act of God excepted. It also contains the clause that if at any time hereafter the property be acquired by the Calcutta Improvement Trust or the Corporation of Calcutta or any other Government or Public Body during the period of this lease or its extended period as the case may be, this lease shall be determined and the entire compensation for such acquisition shall belong to the lessor and the lessee shall have no claim thereto.
5. The Advocate for the defendant-appellant wrote a letter on 27-1-1971 to the plaintiff expressing the intention of the defendant of having the lease renewed for a further period of 15 years, as the same was going to expire on 30th day of September, 1971. This was done keeping in view of the provisions in the lease deed providing 3 month's notice in writing before the expiry of the lease provided renewal was intended. No step was taken for execution and/or registration of new lease deed as per the renewal clause. The lessee continued in possession in exercise of his right of renewal or extension contained in the original registered deed after expiry of the initial period of 15 years although no document was registered. The lessor, however, also continued to accept the rent even after the expiry of the period of 15 years up to the month of August, 1986.
6. The plaintiffs-respondents intimated the defendant-appellant on 17th April, 1986 about the expiry of the lease period of 30 years and called upon the defendant to deliver vacant and peaceful possession of the premises in suit to them on the expiry of the renewed period, i.e,. of the expiry of 30th September, 1986.
7. The trial Judge framed the following issues:--
1. Is the suit maintainable in its present form?
2. Have the plaintiffs any cause of action and right to sue?
3. Is the defendant holding the suit premises under the registered lease deed dated 8-10.-56?
4. Has the said lease expired by efflux of time? If not is the said lease renewed as per option of renewal provided in the deed of lease?
5. Are the plaintiffs entitled to the decree as prayed for?
6. To what relief, if any, the plaintiffs are entitled?
8. According to the Judge of the trial court the period of lease expired after 30 years by efflux of time on 30th September, 1986. He also held that the defendant through his lawyer sought for extension of the lease for another period of 15 years and that was allowed by the plaintiff. He also held that the option for renewal was duly exercised by the defendant and he enjoyed the benefits of the letter and he paid his rents to the plaintiff and enjoyed the lease for a term of thirty years. He was of the view that it did not lie in the mouth of the defendant to say that the lease was not renewed or that he became a monthly tenant. He further held that the suit was maintainable in its present form and the plaintiffs had cause of action to sue and the plaintiffs were entitled to get the decree for khas possession and mesne profits as prayed for and as such he decreed the suit.
9. The area of difference with respect to the 1st question is concerned is practically nil as both the Hon'ble Judges came to the same conclusion. It would be not irrelevant to quote Hon'ble Mr. Justice B. L. Jain on this point. His Lordship held as follows:--
"In other words where the date of commencement is mentioned, the same is to be considered as the day for which the lease commenced, such date may be earlier or subsequent to the date of execution of the lease. In the premises I am of the view that the duration of the lease was for a period of 15 years and I do not find any grounds for accepting the contention of the appellant, that the lease was for a period of less than 15 years. I have already discussed section 110 of the Transfer of Property Act as also the eviction on record and in view of that as also in view of Ihe cases referred to herein above no other conclusion is possible in the facts of this case except that the original lease was for a period of 15 years."
10. Hon'ble Mr. Justice S. Narayan came to the same conclusion by observing as follows :--
"I, do agree with the learned Presiding Officer of this bench, answering the first question in favour of the landlords-plaintiffs while upholding the findings of the Trial Court. The initial period of the lease defined in the deed as 15 years and actually commencing from the 1st October, 1956 to 30th September, 1971 cannot and does not fall short of 15 years merely because of the registration of the deed having been effected on October 8, 1956."
11. From the above it is amply clear that the two Hon'ble Judges of the Division Bench were unanimous on the point that the said deed of lease did not fall short of 15 years and as such-they did not accept the contention of the defendant-appellant that it fell short of 15 years. This finding was not seriously challenged before me and I am also of the view that the two Hon'ble Judges came to the correct concurrent finding that the initial period of the lease as contained in the deed was for 15 years actually commenced from 1st October, 1956 to 30th September, 1971 and the said initial period did not fall short of 15 years merely because it was registered on a subsequent dale, i.e., on Octobers, 1956.
12. Before coming to the 2nd question it is worth to note that the Judgment of Hon'ble Justice B.L. Jain has not taken note of the word 'extension' appearing in the deed of lease at two places where firstly, it has been said that "at the termination of the tenancy after the period of 15 years or 30 years if the period be extended hereafter of this demised premises to yield up quite peaceful possession of this demised premises and the said privy and the bath room in a good condition....." and secondly, where it has been said that "if at any time hereafter the property be acquired by the Calcutta Improvement Trust or the Corporation of Calcutta...... during the period of this lesae or its extended period as me case may be, this lease shall be determined and the entire compensation for such acquisition shall belong to the lessor and the lessee shall have no claim thereto." The deed of lease contains both the clauses, i.e., the clause of 'renewal' and the clause of 'extension'.
13. The law is very clear on the point. The lease of immovable properly from year to year, or for any term exceeding one year, or reserving a yearly rent, can be made only by a registered instrument under S. 107 of the Transferof Property Act, 1982 and the party has admitted this position. The law also appears to be clear on the point that ordinarily incase of renewal anew lease is required and in case of extension the same lease continues in force during additional period by the performance of the stipulated act. In this connection reliance has been placed by the defendant-appellant on a decision of the Apex Court (Provash Chandra Dulai v. Bishwanath Banerjee where it was held as follows (at p. 1839 of AIR) :--
It is pertinent to note that the word used is 'extension' and not 'renewal'. To extend means to enlarge, expand, lengthen, prolong, to carry out further than its original limit. Extension, according to Black's Law Dictionary, means enlargement of the main body; addition of something smaller than that to which it is attached; to lengthen or prolong. Thus, extension ordinarily implies the continued existence of something to be extended. The distinction between 'extension' and 'renewal' is chiefly that in the case of renewal, a new lease is required while in the case of extension the same lease continues in force during the additional period by the performance of the stipulated act. In other words, the word 'extension' when used in its proper and usual sense in connection with a lease means a prolongation of the lease. Construction of this stipulation in the lease in the above manner will also be consistent when the lease is taken as a whole."
14. In the aforesaid case the clause in the lease at the first instance provided for a period of 10 years and for successive extension upto 20 years. The lease was held to be a lease for 20 years. It was also held that renewal is a fresh or new lease and extension is to lengthen or prolong the original lease. But the Hon'ble Supreme Court, as submitted by Mr. Mukherjee, the learned lawyer for the plaintiff-respondent, was not considering in the aforesaid case consequences of remaining in possession for a further period without a fresh deed of lease. He further submitted that in a way the aforesaid decision of the Hon'ble Supreme Court supports the casc of the lessor as the original deed contemplates extension also. It was submitted by Mr. Mukherjee that continuance in possession under a renewal clause without a new registered deed has the effect of prolongation/extension as held in (Lalit Mohan Dey v. Satadalbasini Dasi); (Syed Ali Kaisarv. Mussit. Ayesha Khatoon); (1988) 2 Cal LJ 135 (Pravin Chandra Lilladhar v. Madan Maha Jaidka; (1984) 1 Cal LJ 16 (Bank of India v. Smt. Govinda Devi Binani).
15. Sri Das Gupta, appearing on behalf of the defendant-appellant, has also placed reliance on the decision as (Delhi Development Authority v. Durga Chanda Kaushis, wherein the Hon'ble Supreme Court held as follows (at p. 2611 of AIR) :--
"A renewal of a lease is really the grant of a fresh lease. It is called a "renewal" simply because it postulates the existence of a prior lease which generally provides for renewals as of right. In all other aspects it is really a fresh lease."
16. The Hon'ble Supreme Court was considering in this Delhi Development Authority's case, that the enhancement of rent as contemplated under Cl. 9 of the original lease was in respect of a fresh lease to be executed after the expiry of the original term. The Hon'ble Supreme Court was dealing with the question what would happen if after the expiry of the lease for 90 years a new lease is executed and held that it would be a new lease. In Lalit Mohan Dey v. Satadalbasini Dasi, the Division Bench of this Court was dealing with acase where after the expiry of the original term of 20 years the lessee after exercising the option continued in possession for the entire term or further period and held in such a case the further period is to be treated as part of the original term. The two cases referred to above are altogether different on facts and on law. I will discuss the case of Satadalbasini in some detail at appropriate place.
17. Mr. Das Gupta appearing on behalf of the appellant-defendant drew my attention also to the observation made in Mulla' Transfer of Property Act 8th Edition at page 914 wherein it has been said, "A covenant for renewal containing in a lease does not ipso facto extend the tenure or terms of the lease but only entitles the lessee to obtain a fresh lease in accordance with and in due satisfaction of the law governing making of leases."
18. Hon'ble Justice Baboo Lal Jain after discussing the case and the case lawson me points involved in this case came to the following conclusions:--
'The principles that can be derived from the different Judgments of the Supreme Court, of this court, and also of the other courts which, have been cited above may be summarised as follows
(a) An option for renewal contained in the registered lease, gives rights to the lessee and/or the lessor to obtain a new lease in terms of the renewal clause.
(b) Where the lease deed provides that the lease granted shall be renewed for a further period, it means an agreement for grant of a fresh lease, following termination of earlier lease. Such fresh lease has to be or can be only by a bilateral registered document where the same is for a period more than a year. In other words, a lease cannot be renewed by unilateral act by one of the parties.
(c) Mere exercise of option does not operate as renewal of the lease.
(d) In the instant case the lease was for a period of 15 years as specifically mentioned in the lease deed.
(e) The tenant continuing in occupation under a special agreement for further lease is a different case from the tenant holding over merely by consent, but if for any reason his agreement has to be disregarded he can fall back upon the landlord's mere consent and claim his rights under S. 116. (Per Rankin J. in (cited with approval Satadal Basini's case (supra))".
19. Mr. Mukherjec, the learned lawyer appearing on behalf of the plaintiff-respondent conceded the position that if there is renewal it is a new lease and it requires to be registered, according to law. But at the same time he contended that it is necessary to find out the legal consequences of continuance of possession of the tenant under an old registered lease for a further period without a fresh deed of lease, i.e., without a fresh regislered deed of lease which was not found out by the Hon'ble Supreme Court either in Provash Dului v. Biswanath Banerji, or in Delhi Development Authority v. Durgachand Kaushis, while discussing matter relating to "renewal" and/or extension, as no Finding on that point was needed in those cases.
20. According to Section 116 of the T. P. Act if a lessee or under-lessee of property remains in possession thereof after the determination of the lease granted to the lessee, and the lessor or his legal representative accept rent from the lease or under-lessee, or otherwise, assents to his continuing in possession, the lease is, in absence of an agreement to the contrary, renewed from year to year, or from month to month, according to the purpose for which the property is leased, as specified in Section 106. This situation comes only after determination of the lease: The lease must determine first an then the principle of holding over applies. It cannot apply before or where the occupation of the lenancy continues under the old registered lease after exercise of option. In other words, this principle can not apply where the lessee continues in possession under the renewal clause or extension clause of the original registered lease in exercise of his unilateral option under the said original lease as there does not arise any question of subsequent assent by the lessor as the right to enjoy for the further period has been conveyed to the lessee itself though in the form of an option of renewal. In such a situation no question of application of S. 116 of the T. P. Act, arises. Where a tenant undera lease, say for 20 years or 10 years, with a renewal clause, continues in possession after expiry of the said lease, his continuance of possession will be deemed to be under the renewal clause under the old lease though there will not be any express exercise of the said renewal. His rights in the lease hold land would be deemed to have flowed from the registered lease for 20 years or 10 years, and such cases will be outside the mischief of this section.
21. One of the grounds for determination of a lease under S. 111 of the T. P. Act is that a lease of immovable property determines by efflux of the time limited thereby. In the instant case it has to be seen as to what was that time, limited by the lease in question. Was it limited to 15 years or limited to further period of 15 years having option given to the lessee to unilaterally renew or extend the lease for another 15 years? It cannot be said in the instant case that the time was strictly limited to 15 years. In such a case the lessor is not in a position to challenge the renewal of extension for further 15 years if it is sought to be done at the will and desire of the lessee. In such a case the lessor must be treated to have conveyed the right to enjoy for the whole period of 30 years. The said registered deed of lease (Ext. A) contains a clause that "at the termination of the tenancy after the period of 15 years, or 30 years if the period be extended hereafter of this demised premises to yield up quite peaceful possession of the demised premises....." It is worth to note that if the lease determines by efflux of time of 15 years then the question of extension or renewal for another 15 years will not arise. It will arise only if through the original registered deed of lease Some rights flow and in exercise of such rights flowing from the original deed of lease the lessee is made entitled to opt for a further period. In such a case, therefore, it can be said that the lease does not determine finally and completely by efflux of the initial period of the lease. Therefore, in such a case of lease containing renewal or extension clause, the period does not remain limited to the initial period only but it breaks the limit to further flow for another term and the lease in such a case does not determine at the end of the initial period, if at that moment or before, option is exercised as per terms of the deed of lease. In the circumstance it cannot be said that the lease of immovable property determined by efflux of initial period of 15 years limited by the lease as the lease did not limit it to 15 years only. It is worth to note that exercise or non-exercise of the option by the lessee would not affect the fact that the lessor had conveyed the right for 30 years.
22. In the above background and for better appreciation of the other case laws available in this instant appeal it would be necessary to go deep into renewal/extension clause of the lease in question. The relevant clause of the deed runs as follows:--
"If the lessee shall be desirous of having the lease hereby granted renewed for a further period of 15 years, the lessee shall at least 3 calendar months before the expiration of the term hereby granted give the lessor in writing notice of his intention to make such renewed lease and the lessor shall be bound to renew the same at lessee's costs".
23. The deposing defendant (DW1) stated that 3 month's notice was required for renewal of the lease and a notice as such was given by his lawyer, namely Sri Samar Kumar Rudra, who knew it from the terms of the deed of lease itself that a notice was to be given and so he, without waiting" for any instruction, issued the notice. He also admitted that his father used to keep contact with the said lawyer Sri S. K. Rudra. Sri Rudra has been examined in this case as PW 2 on behalf of the plaintiff. He stated on oath that a notice of renewal (Ext. 7) was drafted by him under the instruction of his client and was served upon the landlords/plaintiffs under postal receipts (Ext. 16/2), the postal acknowledgments due (Ext. 17 and 17/1). Thus, the learned lawyer contradicted the defendant (DW 1) by saying that the notice of renewal (Ext. 7) was drafted by him under the instruction of his client and was served upon the landlords. It is in this background that the learned trial Judge held that option for renewal was duly exercised and the defendant enjoyed the fruits of the renewal clause and also paid rent to the plaintiffs and availed the lease for full term of 30 years and as such it did not lie in the mouths of the defendant to say lhat the lease was not renewed or that he become monthly tenant under the plaintiffs.
24. A number of reported cases of the Division Bench of this court throw sufficient light on the legal principles involved in this instant appeal.
25. In the case of Lalit Mohan Dey v. Satadalbasini Dasi, it was held as follows:--
"As already stated, this is not a case of "holding over" under S. 116 of the Transfer of Property Act dehors the above renewal clause but a case of tenancy, if any, under the suit property by the defendant under the plaintiff under the said clause and in the exercise of her rights thereunder. This is clear from the decision of this Court in the Bengal National Bank Ltd. v. Raja Janaki Nath Roy , where Rankin C. J. observed at p. 984 of the report (Cal WN); (at p.730 of AIR) that "the tenant, continuing in occupation under a special agreement for further lease is a different case from the tenant holding over merely by consent but if for any reason his agreement has to be disregarded he can fall back upon the landlord's mere consent and claim his rights under S. 116". (para 11) "In the instant case, the above renewal clause contained the agreement for the lease for the further period of six years, which became binding on both parties, immediately on the lesseee's exercise of the option thereunder, and the rights of the parties came to be governed by the said agreement, contained in the renewal clause in the registered lease for twenty years, giving to the lessee the option of renewal for the "further" period of six years, as mentioned therein, and the property continued to be held (hereunder. True, the clause provided for the execution and registration of a renewal of fresh lease but that was not eventually insisted on by the parties and if, in the circumstances, an effective lease or renewal for the said "further" period did come into existence, the agreement/or renewal was not affected but remained operative and enforceable and bound the patties and governed their rights." (Para 12) "In the premises, the renewal clause or the agreement for renewal cannot be disregarded but must be given its full effect and it may Well be said that the old relationship of landlord and tenant between the parties continued and did not come to an end the lease between them did not determine, merely by reason of expiry of the original period of twenty years but survived in or by reason of its renewal clause aforesaid, which, as one of its terms, still retained its full vigour (Vide in this connection, Hemanta Kumar Devi v. Safatully Biswas . The instant case would not be one of a new tenancy, arising on the invalidity of a lease, by implication or under the law, from possession and payment and acceptance of rent, as in Ram Kumar Das v. Jagadish Chandra Deo, , nor would it be a case of a tenancy a new tenancy--by "Holding over", arising on the determination of a lease by efflux of time, by mere acceptance of rent or assent of the landlord under S. 116 of the Transfer of Property Act, the acceptance on rent being only a form of such assent; Vide Karnani Industrial Bank Ltd. v. Province of Bengal, . It would be a case of tenancy or a quasi or inchoate tenancy under a renewal clause and thus clearly distinguishable from the above clause and thus clearly distinguishable from the above classes of cases and the defendant's continuance of possession, be it as a tenant or otherwise, would be under the unequivocally referable to the renewal clause in question or the agreement, contained therein, and her rights, be they of a tenant or of specific performance or of a quasi or inchoate tenant under S. 53A of the Transfer of Property Act, would be only under the said clause or agreement. In other words, the rights, in or under which the property in question continued to be held by the defendant flowed from the above registered lease for twenty years, containing inter alia the tenant's option for renewal for a further period of six years, and would be referable to the same and it would be doing no violence to language or any juristic or legal conception or principle to regard this holding of the property by the defendant as one under such a lease, so as to fall within the mischief of cl. (b) of S. 2(5) of the Calcutta Thika Tenancy Act and exclude her from the category of 'Thika tenant' under the said Act, even assuming that she would, otherwise have come within it. This conclusion of ours would be quite in accord with the decision of our learned brothers P. B. Mukherjee, J. and Bachawat, J. in Annapurna Seal v. Tincowri Dutt, 66 Cal WN 338, where, under a different approach and different reasoning their Lordships themselves following different types of reasoning our learned brothers reached the same conclusion. As, on the reasoning, given above by us, that conclusion may be well supported, we deem it unnecessary to consider the arguments of Mr. Chakravorty against the reasoning of my learned brothers or upon the apparent inconsistencies in their modes of approach. On the same ground, we deem it unnecessary to discuss the decision, D/- 24-4-1950 of Bose, J. as he then was, in Suit No. 2257 of 1955 of this Court (Original Side) Lalit Mohan De v. Manick Chandra (Cal), where His Lordship reached a similar conclusion as ours, on reasonings, which have been subjected to some criticisms before us by Mr. Chakravorty, somewhat hesitatingly. We would only point out that there is a fundamental distinction between a tenancy by "holding over" under S. 116 of the Transfer of Property Act by mere assent of the landlord (including acceptance of rent as a form of such assent) and a tenancy of rights under a renewal clause. In the first case, the tenancy, though it may Continue the old possession under the old terms, would in law, be a new tenancy dehors the lease and in spite of its determination (vide Gopal Chandra Rudra v. Khater Karikar and Mahadeb Ram Kahar v. Tinkori Roy, . In the Other case, the tenancy or the rights in question arise under the lease itself, though under its renewal clause by reason of the exercise of the lessee's option thereunder. In the latter case, the holding over and continuancy of possession is under the original lease, which has not expired or determined but survives in or by reason of its renewal clause, which sustains the said holding over and referable to the said clause, or, for the matter of that, the original lease itself, while, in the former case, the folding over and continuance of possession is referable to the statute (S. 116 of the Transfer of Property Act) and is under it and cannot stand upon the original lease, which has determined and cannot support or sustain the same. The lease for the optional or further period under the renewal clause would not have been an independent lease but would have been a part and an integral part of the original lease, which, in essence, was for a fixed or firm period of twenty years and an optional or further period of six years, the latter to come into effect on exercise of the option by the tenant, or, in other words, the option of renewal, though it does not affect the term or period of lease until the option is exercised, thus affect it. once it is exercised. The holding thus under the original lease, which, in effect, is a lease for the entire term, including the option period, the latter operating only on exercise of the option. In the case of holding over, it would have been under the 'renewed' or the new or statutory lease under the said section, distinct from and independent of the original lease, which stood determined, though, normally, the terms of the two, serve of course, the period, would, in the absence of an agreement to the contrary, be, practically, the same. The holding under the above statutory "holding over", therefore, would not be a holding under the said original lease.
For the foregoing reasons, we hold that the defendant would not be a thika tenant under the Calcutta Thika Tenancy Act and would not be entitled to its protection. Her plea in that behalf would, accordingly, fall and her appeal (F. A. No. 144 of 1960) must be dismissed. (Para 13)
26. It was held as follows in Syed Ali Kaisar v. Mstt. Ayesha Begum, :--
"In our view, the subsequent period of one year for which the lessee had exercised his option in terms of the lease, Ext. 1, cannot be called to be a fresh lease. It must be held that it was a continuation of the lease as originally executed. The defendant is, therefore, not entitled to any protection under the West Bengal Premises Tenancy Act because such lease is outside the provisions of the said Act by virtue of S. 3(1) of the Act."
"The Division Bench of this Court placing reliance on the aforesaid two authorities came to the following finding the Bank of India v. Smt. Govind Devi Binani (1984) 1 Cal LJ 16 :--
"Since the renewal of the lease was made under the renewal clause of the original lease deed, which was an intergral part of it, no fresh registration would be necessary and as the original lease was executed before 1965 for a period of 16 years, Section 3 of the West Bengal Premises Tenancy Act, 1956 does not apply."
"In Pravin Chandra l.iladhar v. Madan Mohan Jaidka (1988) 2 Cal LJ 135 the Division Bench of this court held as follows :--
"The facts of the present case are on all fours with the facts of Sutadal Basini's case and Syed Ali Kaiser's case (supra), and we are respectfully in agreement with the decisions we feel no hesitation in holding that the lease in the case at hand which originally was for ten years became one for fifteen years after the exercise of the option of renewal by the Respondent No. 1". (Para 12) "The learned Advocate for the Respondent No. 1 argued that it was unreasonable and irrational to hold that the lease in mis case which being for a period of ten years was within the ambit of the Calcutta Thika Tenancy Act, ceased to be so when the lessee exercised his option of renewal. We do not see any incongruity in the situation. A lease with an option of renewal differs from a lease without any option in this, that it contains a latent possibility of increment in the period of the lease. The latent possibility becomes palent with the exercise of the option. If with the exercise of the option, the period of the lease increases and leaves the area of one Act and enters the area of another, that has to be accepted as a natural consequence of events. Reference may be made in this connection to Baker v. Merckel reported in (1960) 1 All ER 668 cited by the learned Advocate for the appellant. This decision follows with approval the dictum of Maugham. J. In Re : Savita Settled Estates. (1931) All ER 557 which runs in the following way :--
"I should add that, in my opinion, an alteration of an existing lease, so that it will operate for a term extending beyond the original term, can operate in law only as a surrender of the old lease and a grant of a new one....." (para 13) "The dictum must have been made in a case where the initial term of the lease was extended by a subsequent deed during the continuance of the initial term which is not the case here. That makes very little difference since in the case of a lease with an option of renewal the means of extending the initial period of the lease is contained within the deed itself in the shape of one of its terms and conditions. The dictum may or may not apply fully to a lease with a condition of renewal as in the present case, but the idea behind it certainly does, since a lease with its period extended by exercise of the lessee's option or renewal will be a lease different from the same lease with its period unextended; for, the period of the two will be different. We do not find, therefore any greaf merit in the objection raised by the learned Advocate for the Respondent No. 1." (Para 14)
27. The latest decision of the Division Bench of this Court may be referred to the case of Sri Sri Ishwar Ganesh Jiu v. M/s. Austin Distributors (Pvt.) Ltd. reported in (1991) 1 Cal HN 210.
28. In this case there was a lease of the suit premises for a period of ten years with an option for renewal for another ten years. The tenant exercised option but no fresh deed was executed for the extended period. It was held that the tenant is protected by the W. B. Premises Tenancy Adas the lease of 31st January, 1957 for 10 years with option to the lessee for another 10 years cannot be treated to be a lease for 15 years or more so as to be excluded from the operation of the W. B. P. T. Act, 1956. The reason is that in the case of Satadal Basini as also in the case of Syed All the initial period excluded the operation of the respective Acts and, therefore, the further period under the option clause cannot be treated to be a new lease under the doctrine of tenancy by holding over. Several earlier Division Bench Judgments starting from the Judgment of Rankin C. J. and ending with the Judgments of the Bench presided over by Manoj Kumar Mukherjee, J. (as His Lordship then was) consistently held to the contrary on the basis of the principles governing the transfer of property. In all these several cases Rent Acts were involved and the continuancy in possession during the further period under the renewal clause was held not to result in new tenancy. The contrary view expressed in Sri Ishwar Ganesh Jiu v. M/s. Austing Distributors (Pvt.) Limited (1991 (1) Cal HN 210) does not take into consideration the settled principle of law that the renewal clause is a part and parcel of the original lease and such a clause in a parent lease giving unilateral option to the lessee is a transfer of the right to enjoy by the lessor to Ihe lessee within the meaning of S. 105 of the T. P. Act subject to the qualification that the lessee opts to exercise his right. In such a case the lessor does not reserve any right to cut it down. Such possession during the further period can be supported as a new lease where a separate registered deed comes into existence, otherwise where no such deed is made it is to be treated as an extension by mutual consent flowing out of the original deed of lease.
29. From the discussions made above it can be safely concluded lhat renewal of a lease is creation of a fresh lease and a fresh lease is required to be registered according to law but where no such fresh lease is created in terms of the renewal clause of the original registered deed of lease no question of registering it arises. If in such a case the lessee continues in possession in exercise of his option as per renewal clause over the leased property after the initial period is over, his continuance in possession would be deemed to be under the original registered deed. The further period is to be treated in such a case as part of the period of the original registered deed of lease. Thus, in such a case, where a lease contains renewal or extension clause, the period does not remain limited to the initial period only but it breaks the limit to further flow for another term and the lease does not determine at the end of the initial period on exercise of unilateral option by the lessee as in such a case there does not arise any question of fresh assent by the lessor because the right to enjoy for further period gets conveyed to the lessee under the original registered lease itself. In the instant case the lessee exercised his option and continued in possession after the expiry of the initial period of 15 years as per the renewal/ extension clause and as such his continuance would be deemed to be under the old registered deed of lease. His continuance in possession thereafter of the demised premises would not be holding over the same under S. 116 of the T. P. Act and his tenancy would not be governed under the provisions of the West Bengal Premises Tenancy Act, 1956.
30. It is worth noting out here the admission of the deposing defendant (DW 1) that the defendant-tenant, was in occupation of the premises and he was paying rent at the rate of Rs. 700/- per month till the subsistence of the lease. He further admitted that 3 months-notice was required as per renewal clause of the deed of lease and a notice as such was given by his lawyer Sri Samar Rudra, who knew it from the deed of lease itself that a notice was to be given and so without waiting for any instruction, he issued the notice. He also admitted that his father used to keep contact with the said Advocate Sri Samar Rudra. Sri Samar Rudra, a practicing advocate of Calcutta High Court was examined as PW 2 on behalf of the plaintiff-landlords. He (PW 2) stated on oath that he had drafted the notice of renewal (Ext. 7) under the instruction of his client and was served upon the landlords-plaintiffs under the postal receipts Ext. 16/1 and 16/2 and the postal acknowledgments due vide Ext. 17 and Ext. 17/1. It is, therefore, very clear that the option for renewal was duly exercised and the defendant enjoyed the fruits of the renewal clause and also paid rent to the landlord and availed the lease not only for the initial period of 15 years but also for the further renewed period of 15 years, i.e., for 30 years. In substance in the instant case neither the lessee nor the lessor intended to dishonour the terms of the original lease.
31. Extension of a lease is not creation of a fresh lease but prolongation or extension of the old lease. Extension ordinarily implies the continued existence or something to be extended. In case of extension the same lease continues in force during the additional period by the performance of the stipulated act.
32. It appears from the averments of the deed of lease of the instant case that the terms 'renewal' and 'extension' both haye been used in the deed. Mr. Mukherjee, the learned Advocate appearing on behalf of the respondents, has, therefore, submitted that the instant case is much better than the case where in the deed of lease only the word 'renewal' is used. He, has, therefore, rightly submitted that in the circumstances of the case continuance in possession under those clauses or either under any of the two clauses has the effect of extension/prolongation of the old registered deed as held in Satadalbasini , Syed Ali and other cases.
33. There is no force in the submission of Sri Das Gupta, learned lawyer appearing for the appellant that stamp duty of Rs. 255 was only levied on the lease deed (Ext. A) as it was for a period of 15 years and had it been for 30 years the stamp duty levied on the deed of lease (Ext. A) would have been much more.
34. But this submission does not appear convincing. A reference was made under the Stamp Act before a three Judge Bench of the Madras High Court in a similar matter as reported in (1902) ILR 25 Mad 3. Before the said Bench the question referred for opinion was, whether an instrument of lease, for a term of three years at a monthly rent of Rs. 190/-, with a covenant on the part of the lessor to renew the lease at me option of the lessee for a further term of one or two years from me expiration of the said term of three years, was rightly stamped, only with the duty payable on a lease for a term of three years, or whether it should be stamped with the aggregate of the duties payable on a lease for a term of three years and on an agreement to give a lease for a term of two years. The Judges held as follows:--
"We are clearly of the opinion that the instrument has been rightly stamped as a lease for a term of three years and that the Collector was in error in levying an additional stump calculated upon an agreement to give a lease for a term of two years at the monthly rent of Rs. 190/-."
35. It, therefore, appears that an additional stamp duty is not required to he paid in such cases.
36. In view of the discussions made above the answer to the 2nd question is that the said registered deed of lease would not be deemed to have expired by efflux of time on the expiry of the initial period of 15 years in the year 1971 although the lease was not renewed by virtue of a registered deed and as such the defendant-appellant continuing in possession of the demised premises, thereafter and paying the rent would not be deemed to be holding over the same under S. 116 of the T. P. Act and accordingly the tenancy would not be governed under provisions of West Bengal Premises Tenancy Act, 1956.
37. I, therefore, respectfully disagree with the findings of Babulal Jain, J. and agree wilh the findings of Sidheshwar Narayan, J. on the 2nd question. It is also held that the lease in the instant case has since been expired by efflux of time of 30 years, the plaintiff-landlords are entitled to get the decree for khas possession and mesne profit. The appeal, thus, fails and accordingly the Judgment and the decree passed by the Trial Court, the 12th Bench of the City Civil Court. Calcutta are confirmed. In this appeal there will be no order for costs.
38. Appeal dismissed.