Calcutta High Court (Appellete Side)
Ferrazzini'S Bakery vs Amitava Mitter & Ors on 15 March, 2013
Author: Toufique Uddin
Bench: Toufique Uddin
IN THE HIGH COURT AT CALCUTTA
Civil Appellate Jurisdiction
Appellate Side
Present :
The Hon'ble Justice Toufique Uddin
S.A. 14 of 2009
With
CAN No. 11164 of 2012
Ferrazzini's Bakery
Vs.
Amitava Mitter & Ors.
For the appellant : Mr. Jiban Ratan Chatterjee
Mr. Hiranmoy Bhattacharya
Mr. Bidyut Dutta,
Mr. Bijon Dutta
Mr. Sounak Bhattacharya
For the respondents: Mr. Bhaskar Sen
Mr. R. N. Jhunjhunwala
Mr. Debdatta Sen
Mr. Jeevan Ballav Panda
Mr. Rishav Datta
Heard On : 3.12.2012, 12.12.2012, 3.1.2013,
22.1.2013,8.2.2013 and 22.2.2013
Judgment On : 15.03.2013
Toufique Uddin, J. :
This appeal arose out of judgment and decree dated 18.6.2008 passed by the learned Additional District & Sessions Judge, 10th Court, Alipore, South 24 Parganas in Title Appeal No. 164 of 2005 confirming the judgment and decree dated 28.7.2005 passed by the learned Civil Judge, Senior Division, 9th Court, Alipore, South 24 Parganas in Title Suit No. 68 of 1989.
In the background of this appeal the fact in a nutshell is that the original suit was for Khas possession and eviction of lessee and mesne profit on forfeiture of lease. On the basis of the registered deed of lease dated 15.7.64, the defendants were inducted in the suit premises as lessee for 21 years commencing from 15.7.64 at a fixed rental of Rs. 1600/- only p.m. payable according to English Calendar Month with usual covenants restricting creation of sub-tenancy not more than 50% lease hold premises causing damage, causing conversion etc. Under the said lease it was also agreed that the lease at the option of the lessee would be renewed for a period of 5 years more after the expiry of originally agreed period of 21 years provided the lessee exercising their such option six months before the targeted date of expiry of lease and further in the event of such renewal the rate of rent would be enhanced to Rs. 1760/- only p.m. It was also stated that the lessee/defendant having exercising such option continued to remain in their original possession of the suit property upon paying a sum of Rs. 1760/- p.m. only as agreed rent and during the continuance or possession, the lessee made breach of covenants restricting creation of sub-tenancy, causing damage by raising massive new construction and using the premises for residential purpose, although, lease was granted for the business purpose.
The lessor terminated the lease and filed the suit in 1989 for eviction of the lessee, recovery of the possession etc. During pendency of the suit the optional period of lease of 5 years having elapsed on 31.7.90, the plaintiffs on amendment of the plaint inserted the further ground of efflux of time stipulated in the lease.
The defendants contested the suit by filing a written statement wherein they denied each of material allegations. The specific case of the defendants is that the tenancy in question does not come under the purview of Transfer of Property Act whereas the tenancy was governed under the West Bengal Premises Tenancy Act, 1956. It was alleged that the lease in question was not for 21 years and in the said lease deed dated 15.7.64, it has been provided that the lessee shall have option to terminate the lease at any time after 2 years from the commencement of the lease by giving three English Calendar months' Notice in writing to the lessor and as the lessee was not for 21 years on the strict sense, tenancy has not expired with the expiry on 31.7.90. It was further alleged that the defendants never violated any terms and conditions of the lease deed dated 15.7.64. But the defendants of course made some repairs without violating the terms and conditions of the lease. It is further stated that the defendants did not sub-let the suit premises to any other person and the defendants also did not raise any construction. So, the question which was raised by the plaintiffs for inspection did not arise. The defendants did not receive any notice on 22.2.89. The said notice of the plaintiff is not maintainable and it was invalid since after the expiry of the original lease they are possessing the suit property as a monthly tenant being governed by the West Bengal Premises Tenancy Act, 1956 [hereinafter referred to as the said Act] and the said tenancy having not been terminated by any valid notice under Section 13(6) of the said Act of 1956 the suit is not maintainable. So, the defendant prayed for dismissal of the suit.
Upon the pleadings of the parties, the following issues were framed for proper adjudication.
i) Is the suit maintainable in its present form and according to law;
ii) Was the period of lease of suit property as per deed of gift for 21 years only;
iii) Is the tenancy expired with the expiry on 31.7.90;
iv) If the defendants raised permanent structure in the suit property without consent of the landlord;
v) Was the notice of eviction valid and sufficient and was the same duly served upon the defendants;
vi) Are the plaintiffs entitled to get the decree of eviction and other reliefs as prayed for, and
vii) To what other relief or reliefs, if any, are the plaintiffs entitled?
To contest this case, the plaintiffs examined 4 witnesses while the defendants examined 2 witnesses.
On hearing of both sides, the learned Civil Judge, Senior Division, 9th Court, Alipore, South 24 Parganas decreed the suit on contest by judgment dated 28.7.2005.
Being aggrieved by and dissatisfied with the impugned judgment the title appeal No. 164/2005 was filed in the First Appellate Court by the appellants therein on the ground stated therein.
The learned First Appellate Court being the 10th Court of learned Additional District Judge, Alipore, heard both sides and dismissed the title appeal No. 164/2005 by the judgment dated 18.6.2008.
Being aggrieved by and dissatisfied with the impugned judgment the instant Second Appeal has been filed mainly on the following grounds as follows:
i) Whether the First Appellate Court erred in law to decide the status and nature of possession of the Appellants/Defendants after the expiry of original registered lease deed on 31st July, 1985 in the absence of failure to execute and register the deed of lease for a further period of renewal.
ii) Whether the First Appellate Court should have held and erred in not holding that a covenant for renewal contained in a lease deed does not ipso facto extend the tenure of the lease and if to the renewed lease, the requirements of registration are compulsory, no valid lease would come into existence unless registration is made.
iii) Whether the First Appellate Court should have held and erred in not holding that every lease is a separate lease and a lease more than a year to be a valid lease has to be registered in terms of the provisions of the Transfer of Property Act, 1882 as well as in terms of the provisions of the Indian Registration Act, 1908.
iv) Whether the First Appellate Court should have held and erred in not holding that the Respondents having accepted rents from the Appellants/Defendants, after the expiry of original registered lease deed on 31st July, 1985, a new tenancy was created within the meaning of the West Bengal Premises Tenancy Act, 1956 and the Appellants/Defendants became statutory tenant under the said Act of 1956.
v) Whether the First Appellate Court should have held and erred in not holding that the Appellants/defendants having become a statutory tenant after the expiry of the original registered lease deed on 31st July, 1985 within the meaning of the West Bengal Premises Tenancy Act, 1956, a notice under Section 13(6) of the said Act, 1956 is a sine qua non.
vi) Whether the learned Courts below misconstrued the decisions reported in 88 CWN 127 and (2004) 1 CLJ 103 and erred in holding that the said decisions were applicable in the facts and circumstances of the instant case etc. etc. The following substantial question of law was formulated at the time of admission of second appeal.
(a) Whether the learned courts below committed substantial error of law in overlooking the fact that the landlord after expiry of 21 years having accepted monthly rent by granting rent receipt but not having registered a fresh renewal lease for five years, the status of the appellant after the expiry of lease of 21 years was that of a monthly tenant governed by the West Bengal Premises Tenancy Act.
In the meantime, the appellants filed an application numbered as CAN No. 11164 of 2012 for adducing additional evidence in the following manner:
"Your petitioners state that the landlord/plaintiffs/respondents after expiry of 21 years have accepted monthly rent from your petitioners and granted rent receipt in favour of your petitioner acknowledging receipt of rent.
True copies of some of the rent receipts are annexed hereto and are marked with Annexure "A" to this application.
Your petitioners state that upon payment and acceptance of rent a monthly tenancy has been created. The said tenancy is still subsisting and has not yet been determined by taking recourse to the provisions of the West Bengal Premises Tenancy Act.
Your petitioners state that the aforesaid rent receipts which has been annexed to this petition and marked with annexure "A" are required by this Hon'ble Court to be taken as evidence for the purpose of pronouncing the judgment or for any other substantial cause. As such an order be passed allowing your petitioner to produce the said rent receipts as an additional evidence before this Hon'ble Court."
The affidavit-in-opposition was filed against such petition. The learned counsel for the respondents strongly resisted that prayer by stating that the question of law was framed by the Division Bench of this Hon'ble Court while admitting the Second Appeal by an order dated 15.12.2008 mentioned earlier. Further, it was argued that this being the Second Appeal, the Hon'ble Court cannot go into the question of facts and issue of the adjudication is only confined to the question of law which has been framed and further question of facts cannot be adjudicated under any circumstances.
That petition was heard at length and disposed of alongwith the main Second Appeal as follows.
A good number of decisions were submitted by both sides in support of their respective case. It is settled principle of law that admitted facts need not be proved. Annexure A are the copies of rent receipts showing that after expiry of lease of 21 years the respondents/landlord have received the monthly rents of the suit premises by putting signatures for the period from July, 1988 to January 1989. The respondent did not deny it. Therefore, there is no point in taking those for marking as Exhibits. That apart the appeal can be disposed of sans those receipts.
This being the position, I do not find that there is any justification for allowing the prayer under Order 41 Rule 27 of the Code of Civil Procedure when the relevant matter has already been admitted by the respondents that they have accepted rents.
Therefore, CAN No. 11164 of 2012 stands dismissed and disposed of.
Next comes the question of appeal.
The learned counsel for the appellant inter alia argued mainly on the following points in addition to the stand made out in the Memo of Appeal:
i) After expiry of 21 years of lease no deed was prepared or registered, although, the respondents accepted the rents.
ii) There is no proof that the appellants have sub-let more than 50% of the suit premises according to terms and agreement of the original lease deed.
iii) No photograph of the premises was taken earlier, so the photograph taken subsequently cannot be compared.
iv) Even for "holding over" the premises, as argued by the respondents, no notice was given to the appellants by the respondents.
v) The appellants, after the lease period is
over, are the tenants governed by the
provisions of the WBPT Act, 1956.
vi) No notice under Section 13(6) of the said Act was served.
vii) Even the previous notice was not served and the notice, if there was any, was bad in law.
The learned counsel for the appellants relied on the following decisions:
i) AIR 1980 Supreme Court 226
ii) AIR 2000 Supreme Court 3523
iii) 1979 (2) CLJ 144
iv) AIR 2004 Cal 316
v) (2010) 2 SCC 316
vi) (2009) 17 SCC 465, and
vii) (2007) 2 CHN 303 But those decisions are distinguishable here mainly because of the fact that the appellants claim that they have become monthly tenant governed by the provisions of the said Act but the conduct of the appellants has to be taken note of. Some of those decisions relate to West Bengal Premises Rent Control (Temporary Provisions) Act. There is no averment that even after the sending of alleged notice by the respondents, the appellants are continuing with the payment of rent month-by-month to the respondents till now or the tenant ever approached the Rent Controller for deposit of rent under the provisions of the said Act.
Ext.10 and 10/A are two letters dispatched by learned lawyer of the appellants to the respondents. The relevant portion of Ext. 10 at page 2 therein shows "... failing which my client shall be compelled to deposit such rents in the Office of the Rent Controller, Calcutta." Ext. 10/A shows that a cheque of Rs. 1700/- was sent towards the rent for July, 1990. Why Rs. 1700/- was sent is not clear. Save and except those two intimations (Exts. 10 and 10/A) nothing else is found to show that they approached the Rent Controller appropriately for redress. Perhaps knowing fully that the case is not governed by the WBPT Act, 1956, mere pendency of appeal does not entitle the appellants to escape payment of rents. There is no document to show that they paid rent to the Rent Controller or so till now irrespective of the consideration as to whether they will be guided under the WBPT Act or the T.P.Act. There is want of bona fides. So, the question of sending notice under Section 13(6) of the WBPT Act does not arise.
On the other hand, in addition to written argument filed by them, the learned counsel for the respondents argued mainly on the following points as follows:
i) Lease of 21 years is governed by the T.P.Act, 1882. After expiry of original deed of lease of 21 years, no fresh lease was executed for 5 years but the appellants were permitted to continue with the possession on payment of rent after expiry of original lease and this possession will be "holding over" under Section 116 of the Transfer of Property Act, 1882 etc.
ii) The case can never be guided under the provisions of West Bengal Premises Tenancy Act, 1956.
To appreciate the case the original lease deed and some material pieces of evidence are required to be mentioned. The lease deed was executed by and between the parties on 15.7.64 (Ext.A). The relevant terms and conditions of the lease deed are as follows:
..................................................................
i) In the event of the demised premises or any part thereof or any authorized additions thereto being damaged or - destroyed by any means whatsoever caused directly or indirectly by any act or default on the part of the lessee its servants agents licencees, visitors, contractors or - workmen the lessee shall at its own cost and to the satisfaction of the lessor forthwith thereafter repair or restore the demised premises including additions thereto and all - fittings fixtures and appurtenances to the state and condition -
in which they were immediately before being so damaged or destroyed and the lessee shall continue nevertheless to pay full rent taxes and outgoings hereby reserved.
ii) The lessee at its own cost may with the consent of the lessor in writing first had and obtained effect additions and alterations to the demised premises provided that such - additions and alterations shall be in accordance with the law for the time being in force and sanctioned by the Corporation of Calcutta where such sanction is needed, and consent is hereunder given by the lessor unto the lessee to build such sheds not exceeding 15 feet in height from the ground level within the demised premises on obtaining sanction from the Corporation or Calcutta provided such constructions are made leaving at least three feet wide space from the existing main building except for a covered passage connecting such shed to the main building at the demised premises.
iii) Any addition alteration replacement or repair caused by the lessee to the demised premises or any part parcel member or appurtenance thereof shall not be such as to diminish the value of the demised premises as it was immediately before such addition alteration repair or replacement or the value on the date of these presents, whichever is greater, and shall form part of the demised premises after the expiry of the period of lease or determination thereof or surrender of the lease by the lessee, unless the lessee shall remove the same without damaging the demised premises or upon restoring the demised premises to its original condition before termination or sooner determination of the lease hereby created.
iv) The lessee shall have the option to renew the lease hereby created for a period of five years at a monthly rent of Rs. 1760/- (Rupees One Thousand Seven Hundred Sixty only) such renewed lease being on the same terms, conditions, covenants and agreements as herein contained except as to renewal of the term and the enhancement of rent as aforesaid. Such option shall be available to the lessee only on giving to the lessor notice in writing in that behalf at least six months prior to expiry of the term hereby created.
..................................................................
From the evidence on record it transpires that the original lease was for 21 years on payment of rent of Rs. 1600/- p.m. with the renewal clause in the lease deed at Para (o) that the lessee shall have option to renew lease for a period of 5 years on payment of monthly rent of Rs. 1760/- p.m. The case of the respondents is that the petitioners possessed the suit property even after the expiry of the lease for 21 years for some period on the theory of "holding over" according to Section 116 of the Transfer of Property Act whereas the contention of the appellants was that after expiry of the lease when the respondents accepted rents, they became monthly tenant governed by the provisions of the WBPT Act, 1956. That dispute is germane here. Needless to mention that the basis of the possession of the suit property is the lease deed (Ext. A) and even after expiry of 21 years the basis of the possession of the suit premises is also the lease deed as in terms of clause (o) the appellants went on paying enhanced rent of Rs. 1760/- p.m. So, the appellant cannot approbate and reprobate the fact that the possession is not guided by the T.P.Act but by the WBPT Act. It is not the case of the appellants that by virtue of a separate agreement, the rate of rent was enhanced from Rs. 1600/- to Rs. 1760/- p.m. The coming into force of the WBPT Act has not obliterated the scope of lease in terms of Section 106 of the T.P.Act.
The concurrent findings of the learned court below are that before expiry of the further period of 5 years the defendants committed breach of the terms contained in the lease agreement by creating sub-tenancy, causing damage to the said premises and making new construction in the said premises etc. Consequently, the plaintiffs gave a notice dated 22nd February, 1989 terminating the lease.
It is an admitted position that the original lease of 21 years is governed by the Transfer of Property Act, 1882. It is also admitted that after the expiry of 21 years no fresh lease deed was executed for five years after the expiry of 21 years. For the purpose of a renewal of a lease for 5 years, a fresh lease was to be executed and registered in accordance with law. In the instant case, there is no fresh lease far less any registration thereof. Therefore, there is no renewal in the eye of law. Reliance may be placed on the judgment of the Supreme Court in the case of Delhi Development Authority vs. Durga Chand Kaushish reported in (1973) 2 SCC 825. In paragraph 7 of the said judgment it has been observed that:
"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 respects, it is really a fresh lease."
For the purpose of grant of a fresh lease or a renewal there has to be a registered deed of lease. Reliance is placed in this connection to the case of Anthony vs. K.C.Ittoop & Sons & Ors. reported in AIR 2000 Supreme Court 3523 (paragraphs 8, 9, 10 and 11). The aforesaid judgment has been followed by the Division Bench of this Hon'ble Court in the case of Indo Europa Trading Co. Pvt. Ltd. vs. Anil Poddar & Ors. reported in 2007 (2) CHN 303 (paragraph 14).
In the instant case, after the expiry of 21 years, there was no registered lease. So, there cannot be a fresh lease for 5 years. The status of the defendants occupying the said premises and paying rent after the expiry of the original lease will be holding over under section 116 of the Transfer of Property Act, 1882 which runs as under:
"S. 116 - 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 accepts rent from the lessee or under-lessee, or otherwise assents to his continuing in possession, the lease is, in the 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."
The contention of the appellants is that the respondents accepted the rent on 5.3.86 when the appellants were tenant by sufferance and since the rent has been received by the lessor a new tenancy has been created. On this point reference can be made to the decision reported in AIR 1972 SC 890. It was propounded by the Hon'ble Apex Court that mere acceptance of an amount equivalent to rent by a landlord from the tenant in possession after the determination of lease by service of notice or efflux of time can be no evidence of new agreement of tenancy. The appellants simply cannot bank upon the acceptance of the rent to make a case that their tenancy is governed by the said Act. The induction of such tenancy has to be proved. Mere continuity in possession is not enough. Before tendering rent on 5.3.86, the appellants do not appear to have made clear prayer to the respondents that they wanted to remain in possession as tenants under changed circumstances under the provisions of the said Act. Instead of doing this, they tendered rent to the respondents/landlord who accepted such rent. The same was not fixed by separate agreement but was tendered on the basis of clause incorporated in the original lease deed dated 15.7.64. Acceptance of rent by the landlord from the statutory tenant is not creation of new tenancy or renewal of tenancy. Reliance may be put in the decision as reported in AIR 1961 Supreme Court 1967.
The appellants have become lessee by holding over since original lease is governed by the T.P.Act, 1882. So, the lessee holding over upon the expiry of the original deed is also governed by the Transfer of Property Act, 1982. Here, the occupation by holding over by the appellant is renewed from month by month in terms of Section 116 of the Transfer of Property Act. Reliance may be put in the case of Munni Devi vs. State of U.P. reported in AIR 1977 ALL. 386 as under:
"The fact, however, remains that on the expiry of the first period of thirty years, the original lessee continued to be in possession of the demised premises and the Municipal Board, managing the Nazul land on behalf of the Collector, asked for payment of rent at enhanced rate and the lessee thereafter did pay the rent so demanded vide Exts. A-6, A-7, A-8 and A-9. From this it follows that a statutory tenancy was created by holding over under Section 116 of the Transfer of Property Act. Where a lessee remains in possession of immovable property leased even after the expiry of the term of the lease and the lessor accepts rent from him or otherwise assents to his continuing in possession, he would become by reason of the provisions of Section 116 of the Transfer of Property Act a tenant holding over. The tenancy created by the tenant holding over is a statutory tenancy which enables the tenant to retain possession after the expiry of the contractual tenancy. The statutory tenancy so created continues till it is terminated or determined. In the absence of any agreement to the contrary the statutory tenancy created under Section 116 of the Transfer of Property Act may be determined in the manner enjoyed by Section 106 of the Act. The lease is 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 aforesaid."
The lease deed (Ext. A) was executed before commencement of WBPT (Amendment) Ordinance, 1965. So, it has no application to the present lease. Reliance may be put on the case of Mahindra & Mahindra reported in (1989) 1 CLJ 360.
The contention of the appellants cannot be accepted in view of the judgment of the Hon'ble Apex Court in the case of Pabitra Kumar Roy & Anr. Vs. Alita D' Souza reported in (2006) 8 SCC 344 (paragraph 22) which holds that by mere inclusion of such a sooner determination clause fixed period of lease would not cease to be so, if the lessor allows the full term of the lease to operate and the lessee enjoys the entire period of 21 years, as in the instant case, the lease cannot then be governed by the West Bengal Premises Tenancy Act, 1956 merely because such a sooner determination clause appears in the lease deed. In the instant case, the defendants have enjoyed the entire period of 21 years and cannot now agitate that the lease is governed by the West Bengal Premises Tenancy Act, 1956 merely because the lease contain a sooner determination clause.
Regarding other aspects viz. damage of suit property, making new construction, creating sub-tenancy, the concurrent findings of the learned courts below are well reasoned and cannot be re-agitated. Therefore, the circumstances and the materials on record go to suggest that the suit was rightly decreed and there is nothing to interfere with the findings of the learned first appellate court as well.
In the result, the second appeal stands dismissed. I pass no order as to costs in view of the circumstances of the case.
Let a copy of this judgment alongwith the LCR be sent down to the learned court below immediately with a direction to take necessary action regarding execution of decree according to law if within four months hence the appellants do not hand over peaceful possession of the suit property to the respondents.
Upon appropriate Application(s) being made, urgent Photostat Certified copy of this Judgment, be given/issued expeditiously subject to usual terms and conditions.
(Toufique Uddin, J.)