Karnataka High Court
Byadgi And Hirekerur Taluk Kurubara ... vs Babusab S/O Saidusab Halageri on 29 November, 2023
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NC: 2023:KHC-D:14157
RSA No. 2737 of 2006
IN THE HIGH COURT OF KARNATAKA
DHARWAD BENCH
DATED THIS THE 29TH DAY OF NOVEMBER, 2023
BEFORE
THE HON'BLE MRS JUSTICE K.S.HEMALEKHA
REGULAR SECOND APPEAL NO.2737 OF 2006 (RES)
BETWEEN:
KURUBARA UNNE NEKARARA SAHAKARA
SANGHA, NIYAMITA, BYADAGI,
TALUK: BYADAGI,
DIST: HAVERI, BY ITS CHAIRMAN.
BASAVARAJ. S/O. GUDDAPPA KAMBALI,
AGE: 56 YEARS, OCC: AGRICULTURE AND
BUSINESS,
R/O. BYADAGI-581106, DIST: HAVERI.
...APPELLANT
(BY SRI. RAVI S. BALIKAI, ADVOCATE)
AND:
BABUSAB
Digitally
signed by
VISHAL
S/O. SAIDUSAB.
VISHAL NINGAPPA
PATTIHAL
HALAGERI, SINCE DECEASED BY HIS LRs.,
NINGAPPA
PATTIHAL Date:
2023.12.14
11:38:27
+0530
1(A) SRI. JINNAA.
S/O. LATE BABUSAB. HALAGERI,
AGE: 40 YEARS, OCC: AGRICULTURE,
R/O. SANGAMESHWAR NAGAR,
BYADAGI, DIST: HAVERI.
1(B) SRI. HAZARATALI.
S/O. LATE BABUSAB. HALAGERI.
AGE: 36 YEARS, OCC: AGRICULTURE,
R/O. SANGAMESHWAR NAGAR,
BYADAGI, DIST: HAVERI.
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NC: 2023:KHC-D:14157
RSA No. 2737 of 2006
1(C) SRI. BASHA.
S/O. LATE BABUSAB/ HALAGERI,
AGE: 35 YEARS, OCC: AGRICULTURE,
R/O. SANGAMESHWAR NAGAR,
BYADAGI, DIST: HAVERI.
1(D) KUM. BANU.
D/O. LATE BABUSAB. HALAGERI,
AGE: 22 YEARS, OCC: AGRICULTURE,
R/O. SANGAMESHWAR NAGAR,
BYADAGI, DIST: HAVERI.
1(E) SMT. MUNNI.
W/O. RASOOLSAB JILLUR SULMATTI,
AGE: 42 YEARS, OCC: HOUSEHOLD,
R/O. SANGAMESHWAR NAGAR,
HAVERI, DIST: HAVERI.
1(F) SMT. FATHIMA.
W/O. JANGIRSAB. TURABIGUDDA,
AGE: 38 YEARS, OCC: HOUSEHOLD,
R/O. SHIVAPUR BADAVANE,
BYADAGI, DIST: HAVERI.
1(G) SMT. BIBIZAHIRA.
W/O. MOHD. SAMIULLA. KATTELLUR,
AGE: 33 YEARS, OCC: HOUSEHOLD,
R/O. MASUR, TAL. HIREKERUR,
DIST. HAVERI.
1(H) SMT. MUMTAZ.
W/O. MOULABI. MOULASABAR,
AGE: 30 YEARS, OCC: HOUSEHOLD AND BUSINESS,
R/O. PRINCE HARDWARE, KABARASTHAN
COMPLEX, RANEBENNUR, TAL. RANEBENNUR,
DIST. HAVERI.
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NC: 2023:KHC-D:14157
RSA No. 2737 of 2006
1(I) SMT. PARVEEN.
W/O. BABAJAN. TAHASILDAR
AG: 27 YEARS, OCC: HOUSEHOLD,
R/O. KANDAK ROAD, HAVERI,
TAL AND DIST: HAVERI.
1(J) SAIDUSAB.
S/O. BABUSAB. HALAGERI,
SINCE DECEASED BY HIS LRS.,
1(J)(i) SMT. HAZARATBI.
W/O. SAIDUSAB. HALAGERI,
AGE: MAJOR, OCC: HOUSEHOLD WORK,
1(J)(ii) SMT. GOUSIA.
D/O. SAIDUSAB. HALAGERI,
AGE: MAJOR, OCC: HOUSEHOLD WORK,
1(J)(iii) ALTAF.
S/O. SO. SAIDUSAB. HALAGERI,
AGE: MAJOR, OCC: NIL.
1(J)(iv) SMT. ROSHANBANU.
D/O. SAIDUSAB. HALAGERI,
AGE: MAJOR, OCC: HOUSEHOLD WORK,
Nos. 1(j) (i) TO 1(j) (iv) ARE ALL
R/O. SANGAMESHWAR NAGAR,
BYADAGI, TAL: BYADAGI, DIST: HAVERI.
...RESPONDENTS
(BY SRI. S. B. HEBBALLI, ADVOCATE FOR R1 (A TO I;
NOTICE TO R1J (i) TO R1J (iv) SERVED)
THIS REGULAR SECOND APPEAL IS FILED UNDER
SECTION 100 OF THE CODE OF CIVIL PROCEDURE, 1908,
AGAINST THE JUDGMENT & DECREE DATED: 20.9.2006
PASSED IN R.A.NO.49/2002 ON THE FILE OF THE
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NC: 2023:KHC-D:14157
RSA No. 2737 of 2006
ADDL.CIVIL JUDGE (SR.DN.), RANEBENNUR, ALLOWING
THE APPEAL AND SETTING ASIDE THE JUDGMENT AND
DECREE DATED: 29.6.2002 PASSED IN OS.NO.93/1997 ON
THE FILE OF THE CIVIL JUDGE (JR.DN.) & JMFC, BYADGI.
THIS REGULAR SECOND APPEAL, COMING ON FOR
FINAL HEARING, THIS DAY, THE COURT DELIVERED THE
FOLLOWING:
JUDGMENT
The present second appeal by the plaintiff assailing the judgment and decree of the First Appellate Court, whereby, the suit of the plaintiff seeking possession was dismissed, reversing the Judgment and decree of the Trial Court.
2. The parties herein are referred to as per their ranking before the Trial Court for the sake of convenience.
3. Suit for recovery of possession in respect of the suit schedule property, viz., a building and a site measuring 60 x 40 ft., bearing No.939, situated at Byadagi Town Municipal Area and for mesne profits contending that the defendant is occupying the suit schedule property running a flour mill on a "leave and licence" basis as a licencee and -5- NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 though the plaintiff requested for vacating the premises, the same has not been adhered to.
4. Pursuant to the suit summons issued by the Trial Court defendant appeared and filed written statement, inter alia, contending the following grounds:
(i) That the defendant is in occupation of the suit property as a tenant on tenancy basis, until tenancy is terminated in accordance with law he cannot be evicted. The defendant denied that he is in "permissive possession" of the suit property on a "leave and licence" basis.
(ii) That the Karnataka Rent Control Act, 1999 is applicable and the Civil Court had no jurisdiction to try the suit.
(iii) That the Civil Court has no jurisdiction under Section 118 of the Karnataka Co-operative Societies Act, 1959 ("Co-operative Societies Act" for short) and there is a special provision for raising a dispute under Section 70 of the Act, barring the Civil Courts jurisdiction.
(iv) That the suit of the plaintiff is hit by principles of res judicata.
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006
(v) That greater hardship would be caused if an order of eviction is passed against him.
5. The Trial Court, on the basis of the pleadings, framed the following issues:
"1) whether the plff. proves that the deft. has been punistive occupation or under Licencee in the suit schedule premises?
2) Whether the plff. further proves that he has terminated the Licence granted in-favour of the deft. by issuing legal notice as contemplated under law?
3) Whether the plff. is entitle for recovery of possession of the suit property from the deft?
4) Whether the Deft. proves that the suit as brought by the Plff. is improper and it is not maintainable in law?
5) Whether the Deft. proves that the suit is barred by the provision of Sec-70 of K.C.S. Act?
6) Whether the deft. proves that the suit is-
improperly valued and Court-fee paid is in- sufficient?
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006
7) Whether the deft. proves that the Civil Court- has no Jurisdiction to try the present suit and the plff. ought to have invoked the Jurisdiction of Rent Control Court as pleaded in-para7 of the Written Statement?
8) Whether the plff. proves that he is entitle to recover the mesne profit he is entitle Rs.1000/- per- year from the date of termination of Licence in-favour of the deft?
9) Whether the deft. proves that he is not in occupation of the suit property as a Licencee but he is continued in possession as Lessee and there is no termination of Lease in accordance- with law?
10) Whether the suit is barred by the principles of Res-Judicata for the reasons stated in- -para-17 of the Written-Statement?"
6. In order to substantiate the claim, the plaintiff got examined himself as PW.1 and two witnesses as PWs.2 and 3 and got marked documents at Exs.P-1 to P-10. On the other hand, defendant examined himself as DW.1 and three witnesses as DWs.2 to 4 and got marked documents as per Exs.D-1 to D-19.
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006
7. The Trial Court, on the basis of the pleadings, oral and documentary evidence, arrived at a conclusion that the defendant's possession is on the basis of "leave and licence" and the defendant has failed to establish that he is in occupation of the suit schedule property as a "lessee". The Trial Court further held that the defendant has failed to prove that the suit of the plaintiff is not maintainable before the Civil Court and by judgment and decree, decreed the suit of the plaintiff, directing the defendant to handover the possession of the suit schedule property within thirty days from the date of the decree.
8. Feeling aggrieved by the Judgment and decree of the Trial Court, the defendant preferred an appeal before the First Appellate Court.
9. The First Appellate Court, while reversing the Judgment and decree of the Trial Court, held that:
i) The plaintiff-Society's suit is not maintainable in light of the provisions of -9- NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 Section 118 of the Co-operative Societies Act.
ii) The society has to raise a dispute under Section 70 of the Co-operative Societies Act. Further, the First Appellate Court held that the Karnataka Rent Control Act, 1999 is applicable and the plaintiff has not issued notice as contemplated under Section 106 of the Transfer of Property Act, 1882 ("TP Act" for short), as the defendant is a lessee of the suit schedule property and suit of the plaintiff is not maintainable.
10. The First Appellate Court was of the view that even assuming that the appellant becomes only the "licencee," even a licencee can be termed as a "lessee" because of the continuous possession of the suit schedule property and by the judgment passed by the First Appellate Court, the suit of the plaintiff for possession was dismissed, reversing the judgment and decree of the Trial Court. Aggrieved by the same, plaintiff filed second appeal before this Court.
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006
11. This Court, while admitting the appeal on 24.11.2007, has framed the following substantial question of law:
"Whether the lower appellate Court was justified in reversing the Judgment and decree of the trial Court on the ground that the suit is not maintainable u/s.118 of the Karnataka Co- operative Societies Act ?"
12. Sri Ravi S.Balikai, learned counsel for the appellant and Sri S.B.Hebballi, learned counsel appearing for the respondent have been heard on the substantial question of law framed by this Court.
13. This Court has carefully considered the rival contentions urged by the learned counsel for the parties and perused Judgment and decree of the Courts below including the original records.
14. Before answering the substantial question of law, I.A.No.4/2022 filed by the appellant-plaintiff seeking for amendment of the plaint needs to be considered.
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006
15. I.A.No.4/2022 is filed under Order VI Rule 17 of CPC, seeking permission to amend the plaint para No.2 and the suit schedule annexed to the plaint and incorporate the correct survey number, municipality number and plot number of the suit property belonging to the society. The plaint para No.2 is mentioned as hereunder:
"zÁªÉÃzÀ D¹ÛAiÀÄ ªÀtð£É.
zsÁgÀªÁqÀ f Áè ¨ÁåqÀV vÁ®ÆPÀ ¨ÁåqÀV ±ÀºÀgÀzÀ ¸ÀAUÀªÉÄñÀégÀ £ÀUÀgÀzÀ ªÁå¦ÛAiÀÄ°ègÀĪÀ j.¸À.£ÀA. 185 £ÉÃzÀÝgÀ°èAiÀÄ ©£À ±ÉÃwÌ ¥Áèmï £ÀA. 17, PÉëÃvÀæ 0 JPÀgÉ 10 UÀÄA-14 3/4 DuÉ £ÉÃzÀÝgÀ°ègÀĪÀ PÀlÖqÀ«zÀÄÝ, EzÀgÀ GzÀÝ 60 ¥ÀÇmï, CUÀ® 40 ¥sÀÇmï EgÀÄvÀÛzÉ. EzÀPÉÌ ¨ÁåqÀV ¥ÀÅgÀ¸À¨sÁzÀªÀgÀÄ D¹Û £ÀA. 5549/995 CAvÁ PÉÆnÖgÀÄvÁÛgÉ. F D¹ÛAiÀÄ ZÀPÀ§A¢ PɼÀV£ÀAvÉ EgÀÄvÀÛzÉ. ¥ÀǪÀðPÉÌ : ¸ÀzÀgÀ ©£ï ±ÉÃwÌ ¥Áèmï £ÀA. 17 gÀ°ègÀĪÀ ªÁ¢ ¸ÀAWÀzÀ EvÀgÉ PÀlÖqÀUÀ¼ÀÄ .
¥À²ÑªÀÄPÉÌ : ªÀĹâ ªÀÄvÀÄÛ ¦ÃgÀ¸Á§ EªÀgÀ ªÀÄ£É. GvÀÛgÀPÉÌ : ¥ÀÅgÀ¸À¨sÉ D¹Û £ÀA. 5549/995 £ÉÃzÀÝgÀ°èAiÀÄ CAzÀgÉ ©£ï ±ÉÃwÌ ¥Áèmï £ÀA. 17 £ÉÃzÀÝgÀ°èAiÀÄ G½zÀ RÄ Áè eÁUÀ. zÀQëtPÉÌ : gÀ¸ÉÛ F ZÀPÀ§A¢ ªÀÄzsÀåzÀ°ègÀĪÀ D¹ÛAiÀÄÄ ªÁ¢AiÀÄ ªÀiÁ°Ì D¹Û EgÀÄvÀÛzÉ. ¸ÀzÀgÀ D¹ÛAiÀÄ ¸ÀªÀÄUÀæ «ªÀgÀuÉAiÀÄ£ÀÄß ±ÉqÀÆå®ß°è «ªÀj¸À ÁVzÉ".
16. By way of amendment, the plaintiff is seeking to correct the survey number, municipality number and plot number, which reads as under:
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 "And Suit Schedule:
"zsÁgÀªÁqÀ f Áè ¨ÁåqÀV vÁ®ÆPÀ ¨ÁåqÀV ±ÀºÀgÀzÀ ¸ÀAUÀªÉÄñÀégÀ £ÀUÀgÀzÀ ªÁå¦ÛAiÀÄ°ègÀĪÀ j.¸À.£ÀA. 185 £ÉÃzÀÝgÀ°èAiÀÄ ©£À ±ÉÃwÌ ¥Áèmï £ÀA. 17 PÉëÃvÀæ 0 JPÀgÉ 10 UÀÄA-14 3/4 DuÉ £ÉÃzÀÝgÀ°ègÀĪÀ PÀlÖqÀ«zÀÄÝ, EzÀgÀ GzÀÝ 60 ¥sÉÇÃmï, CUÀ® 40 ¥sÀÇmï EgÀÄvÀÛzÉ. EzÀPÉÌ ¨ÁåqÀV ¥ÀÅgÀ¸À¨sÁzÀªÀgÀÄ D¹Û £ÀA. 5549/995 CAvÁ PÉÆnÖzÁÝgÉ. ªÀÄvÀÄÛ ªÉÆzÀ®Ä ¸ÀzÀgÀ D¹ÛAiÀÄ C¢üPÁjUÀ¼ÀÄ j.¸À.£ÀA. 185-17 CAvÁ PÉÆnÖzÀÄÝ EvÀÄÛ. F D¹ÛAiÀÄ ZÀPÀ§A¢ PɼÀV£ÀAvÉ EgÀÄvÀÛzÉ.
¥ÀǪÀðPÉÌ : ¸ÀzÀgÀ ©£ï ±ÉÃwÌ ¥Áèmï £ÀA. 17 gÀ°ègÀĪÀ ªÁ¢ ¸ÀAWÀzÀ EvÀgÉ PÀlÖqÀUÀ¼ÀÄ.
¥À²ÑªÀÄPÉÌ : ªÀĹâ ªÀÄvÀÄÛ ¦ÃgÀ¸Á§ EªÀgÀ ªÀÄ£É. GvÀÛgÀPÉÌ : ¥ÀÅgÀ¸À¨sÉ D¹Û £ÀA. 5549/995 £ÉÃzÀÝgÀ°èAiÀÄ CAzÀgÉ ©£ï ±ÉÃQÌ ¥Áèmï £ÀA. 17 £ÉÃzÀÝgÀ°èAiÀÄ G½zÀ RÄ Áè eÁUÀ. zÀQëtPÉÌ : gÀ¸ÉÛ F ZÀPÀ§A¢ ªÀÄzsÀåzÀ°ègÀĪÀ ¥ÀÇgÁ D¹ÛAiÀÄÄ ªÁ¢AiÀÄ ªÀiÁ°Ì D¹Û EgÀÄvÀÛzÉ".
17. It is stated in the affidavit accompanying the application that, the suit schedule property was described as NA plot bearing No.32, Municipal No.939 situated in RS No.204+205 of Byadagi Town totally measuring 10 guntas 14¾ annas, building in a portion measuring 60 ft. x 40 ft., with specific boundaries as mentioned in the plaint. It is stated that some error has crept in, while mentioning the property number, municipal number and survey number
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 and the correct property number is mentioned as NA Plot No.17, bearing municipal No.5549/995 in RS No.185, totally measuring 10 guntas 14¾ annas, out of which, the building portion measuring 60 ft. x 40 ft., along with the boundaries. The reasons stated in the affidavit are that, the mistake is a bona fide, it has been occurred by inadvertence and oversight and it is a technical mistake. In support of the contention to evidence the actual survey number of the suit property, a copy of the sale deed in favour of the plaintiff is produced.
18. In addition, the appellant has placed the copy of the plaint in O.S.No.18/2021, filed by the defendant herein for permanent injunction and copy of the order passed on I.A. in the said suit.
19. The respondent-defendant filed objections to the said application-I.A.No.4/2022, inter alia, contending that the plaintiff has sought for change of nature of the property in question, boundaries mentioned in para No.2 of the plaint, schedule property in the plaint differs from the one
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 sought to be amended and the description of the property described in para No.2 of the plaint is left unamended and only the schedule in the plaint cannot be permitted to be amended. It is also stated by the respondent's counsel that in the event, this Court permits such amendment, the defendant - respondent should be permitted to file additional written statement.
20. This Court has carefully perused the application- I.A.No.4/2022 as well as the objections filed to I.A.No.4/2022 and the contentions of the respective counsel.
21. Order VI Rule 17 of CPC needs to be looked into while considering the application filed for amendment, which reads as under:
"Order VI - PLEADINGS GENERALLY xxxx
17. Amendment of pleadings.- The Court may at any stage of the proceedings allow either party to alter or amend his pleadings in such manner and on such terms as may be just, and all such amendments
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 shall be made as may be necessary for the purpose of determining the real questions in controversy between the parties:
Provided that no application for amendment shall be allowed after the trial has commenced, unless the Court comes to the conclusion that in spite of due diligence, the party could not have raised the matter before the commencement of trial."
22. Plain reading of the said Section envisages that the Court may at any stage of the proceedings can allow the parties to amend or alter the pleadings in such manner or in such term as it may be, all such amendments shall be made as may be necessary for the purpose of determining the real questions in controversy between the parties. The exception is that no application for amendment shall be allowed, after trial has commenced, unless the Court comes to the conclusion that in spite of due diligence, the party could not have placed the matter before the commencement of trial.
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006
23. The amendment sought is in respect of incorporating the correct survey number, municipal number and plot number of the suit schedule property in para No.2 of the plaint. The measurement and the boundaries of the suit schedule property from the original to amendment stands unchanged. The reason stated is a technical mistake and bona fide and the parties knowing fully well the suit property have went in trial, understood the suit schedule property, merely because the plaintiff is seeking for correction of survey number, municipal number and plot number would not change the nature of the suit schedule property. It is also relevant to note that the suit instituted by the defendant herein against the present plaintiff in O.S.No.18/2021 and at para No.2 of the suit, schedule property is mentioned as under:
"zÁªÉÃzÀ D¹Û: zÁªÁzÀ D¹ÛAiÀÄÄ ¨ÁåqÀV vÁ®ÆPÀ ¨ÁåqÀV ±ÀºÀgÀzÀ ¸ÀAUÀªÉÄñÀégÀ £ÀUÀgÀzÀ ©£ï ±ÉÃwÌ ªÀÄ£É ªÀ RÄ Áè eÁåUÁ EgÀÄvÀÛzÉ. CzÀgÀ «ªÀgÀ UÁæªÀÄ ¸ÀªÉð £ÀA. ¥Áèl £ÀA. PÉëÃvÀæ(J-UÀÄA-D) ¨ÁåqÀV 185 17 10-14-76 (j.¸À.£ÀA. 204 ªÀÄvÀÄÛ 205 ¥Áèl £ÀA. 32 ¸ÀzÀgÀ D¹ÛAiÀÄ ZÀPÀ̧A¢
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 ¥ÀƪÀðPÉÌ : gÀ¸ÉÛ ¥À²éªÀÄPÉÌ : ªÀÄ¢£Á ªÀĸÀÆw GvÀÛgÀPÉÌ : gÀ¸ÉÛ zÀQëtPÉÌ : gÀ¸ÉÛ F ZÀPÀ̧A¢ ªÀÄzÀåzÀ D¹ÛAiÀÄÄ zÁªÁ D¹Û EgÀÄvÀÛzÉ. ¸ÀzÀj D¹ÛAiÀÄ£ÀÄß zÁªÉÃzÀ D¹ÛAiÀÄAzÀÄ £ÀªÀÄÆ¢¸À ÁUÀĪÀÅzÀÄ."
24. The perusal of the description of the suit schedule property in O.S.No.18/2021, indicates that the suit survey number, municipal number and plot number, which is sought to be incorporated by way of amendment is being stated in the plaint in O.S.No.18/2021 filed by the defendant. It is also relevant to state that the injunction was sought by the plaintiff in the said suit in respect of the amended suit schedule property and the injunction sought was dismissed by the trial Court. Since the amendment of the suit schedule property as sought in I.A. No.4/2022 does not change the nature of the suit property, the question of permitting the respondent-defendant to file a written statement would not arise, particularly in view of the fact that in his suit, he has incorporated the very same survey number, municipal number and plot number stated supra
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 as suit schedule property. In the said circumstances, I.A.No.4/2022 needs to be allowed, and the appellant- plaintiff is permitted to incorporate survey number, municipal number and plot number of the suit schedule property in the plaint schedule as mentioned in the application-I.A.No.4/2022 and carry out the necessary amendment.
25. Before adverting to the substantial question of law framed by this Court, relevant facts needs to be considered to understand the actual dispute between the parties. The plaintiff was running a Kurubara Woollen Weavers' Association and they were manufacturers of blankets (kambalies) and the defendant had come forward for open plot, and in that regard, the plaintiff - association had given the open plot to the defendant for running the flourmill and the defendant was in possession of the suit schedule property and was running the flourmill in the said area. The plaintiff contended that the defendant is a "licencee" and on the other hand, the defendant contended
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 that he is a "lessee" over the suit schedule property. PW1 to PW3 have categorically spoken about the possession of the defendant on the basis of "leave and licence" and his possession being in a "permissive possession". PW2 has spoken about the possession of the flourmill by the defendant and about the defendant request to the plaintiff's society to permit him to run the flourmill for two or three months and he would make necessary arrangements to shift the flourmill to his own property. Another member of the Managing Committee - PW3 also spoken about the nature of the occupation of the suit property by the defendant and he has produced the sale agreement letter at Ex.P10. Ex.P10 is the document, which is placed reliance by the plaintiff i.e., the "sale letter" executed by the plaintiff - Society on 17.07.1978 in favour of the defendant, thereby, acknowledging the sale of the flourmill and its part payment of Rs.7,900/- and the receipt of sum of Rs.4,600/- as advance sum and the balance to be paid at the time of change of the name in R.R. number and meter in his name. The plaintiff, in support of its contention has
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 mainly relied upon Exs.P6 to P9, Ex.P-7 is the evidence of the defendant in O.S.No.3/1997, wherein he asserts that he is the tenant of the suit property and not a "licencee" and states that he has records to show that he is a tenant, in his cross-examination, he contends that he is in possession since 21 years and he admits about the purchase of the flourmill from Susheela Bai and also having taken the permission from the plaintiff - Society to run the machine in the suit property for few months. Another key documents are Exs.P8 and P9, Ex.P-8 is the application submitted by the defendant to HESCOM to transfer the power meter in his name stating that he would be shifting the flourmill to his own premises within four months. The other important document is "Oppige Patra" at Ex.P9, the consent letter dated 29.03.1982 executed by the defendant in favour of the plaintiff - Society that he would run the flourmill in the suit schedule property temporarily and he would vacate the premises and handover the vacant premises as and when the plaintiff - Society demands.
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006
26. On the other hand, the defendant contended that he is running the flourmill since 1978 having purchased the same from the plaintiff, but he contended that he is in occupation of the premises as a tenant and however, he admits that there is no document with regard to lease agreement nor any rent receipts are being issued by the Society. It is also relevant to state here that the defendant
- DW.1 denies his signature on the pleadings in the earlier suit in O.S.No.3/1997 and he states that he has no documents to prove that he has paid the rents to the plaintiff - Society. The witnesses examined on behalf of the defendant have admitted that they do not know about the rent having been paid by the defendant to the plaintiff - Society. What has been stated by the said witnesses is that, they are paying rent to the Society and it can be assumed that the defendant is also paying rent of the said premises to the plaintiff-society. Other than merely stating that defendant is the tenant of the suit schedule property, no materials are forthcoming, documents produced at Exs.D1 to D19, nowhere establish that the defendant at any
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 point of time was a "lessee" of the suit schedule property. The important document which is placed by the defendant is Ex.D15, which is a sale deed dated 13.09.1981 executed by the plaintiff - Society in favour of defendant for having sold the flourmill and other machines. The sale letter refers to the earlier sale made by plaintiff - Society to Susheela Bai, from whom the defendant has again purchased the flourmill and the machineries, which is the very document relied by the plaintiff, the other documents are pertaining to the flourmill licence fee paid. No materials are forthcoming regarding the occupation of the premises as a "lessee" and under Section 105 of the Transfer of Property Act, 1882 ('the TP Act' for short), necessary notice was to be issued to the defendant seeking possession of the suit schedule property.
27. Lease is defined under Section 105 of the TP Act, 1882, which reads as under:
"105. Lease defined.--A lease of immoveable property is a transfer of a right to enjoy such property, made for a certain time, express or
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms. Lessor, lessee, premium and rent defined.--The transferor is called the lessor, the transferee is called the lessee, the price is called the premium, and the money, share, service or other thing to be so rendered is called the rent."
28. The essential ingredients of lease is, that (i) it pertains to immoveable property (ii) a transfer of a right to enjoy such property, (iii) made for a certain time, (iv) express or implied, or in perpetuity, in consideration of a price paid or promised (v) share of crops, (vi) service, (vii) or any other thing of value, (viii) to be rendered periodically
(ix) on specified occasions to the transferor by the transferee, & (x) who accepts the transfer on such terms.
29. Licence has been defined under Section 52 of the Indian Easements Act, 1882, which reads as under:
"52 "License" defined. -Where one person grants to another, or to a definite number of other
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 persons, a right to do, or continue to do, in or upon the immovable property of the grantor, something which would, in the absence of such right, be unlawful, and such right does not amount to an easement or an interest in the property, the right is called a license."
30. The essential ingredients of the licence is that it does not create any interest over the suit schedule property. The distinction between the "lease" from "licence" is that the lease is a transfer of interest in land by creating right in favour of lessee in rem, license on the other hand only makes an action lawful which without it would be unlawful but would not transfer any interest in favour of the "licensee" in respect of the property.
31. Reliance placed by the learned counsel for the appellant in the case of Mangal Amusement Park Private Limited and Another Vs. State of Madhya Pradesh and others1, is squarely applicable to the present 1 (2012) 11 SCC 713
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 case on hand, the Apex Court at paragraph Nos.16, 17, 18 and 19 has held as under:
"16. Consideration of the rival submissions The principal question to be considered is: as to whether the document of allotment of land dated 6- 5-1994 was in any way a lease or a licence. As far as a lease is concerned, Section 105 of the Transfer of Property Act, 1882, defines it as follows:
"105. Lease defined.--A lease of immovable property is a transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms.
Lessor, lessee, premium and rent defined.--
The transferor is called the lessor, the transferee is called the lessee, the price is called the premium, and the money, share, service or other thing to be so rendered is called the rent."
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 As far as a license is concerned, the same is defined under Section 52 of the Easements Act, 1882, as follows:-
"52. 'License' defined.--Where one person grants to another, or to a definite number of other persons, a right to do, or continue to do, in or upon the immovable property of the grantor, something which would, in the absence of such right, be unlawful, and such right does not amount to an easement or an interest in the property, the right is called a license."
From these two definitions it is clear that a lease is not a mere contract but envisages and transfers an interest in the demised property creating a right in favour of the lessee in rem. As against that a license only makes an action lawful which without it would be unlawful, but does not transfer any interest in favour of the licensee in respect of the property.
17. The issue concerning the distinction between lease and license came up for consideration before this Court in Associated Hotels of India Ltd. v. R.N. Kapoor AIR 1959 SC 1262. In para 27 of his judgment, Subba Rao, J. (as he then was) observed therein as follows with respect to lease:-
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 "27. There is a marked distinction between a lease and a license. Section 105 of the Transfer of Property Act defines a lease of immovable property as a transfer of a right to enjoy such property made for a certain time in consideration for a price paid or promised.
Under Section 108 of the said Act, the lessee is entitled to be put in possession of the property. A lease is therefore a transfer of an interest in land. The interest transferred is called the leasehold interest. The lessor parts with his right to enjoy the property during the term of the lease, and it follows from it that the lessee gets that right to the exclusion of the lessor."
Thereafter, the learned Judge referred to the definition of "license", then observed as follows:-
"Under the aforesaid section, if a document gives only a right to use the property in a particular way or under certain terms while it remains in possession and control of the owner thereof, it will be a license. The legal possession, therefore, continues to be with the owner of the property, but the licensee is permitted to make use of the premises for a particular purpose. But for the permission, his occupation would be unlawful. It does not
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 create in his favour any estate or interest in the property. There is, therefore, clear distinction between the two concepts. The dividing line is clear though sometimes it becomes very thin or even blurred."
18. Subba Rao, J., thereafter referred to the judgments of the Court of Appeal in Errington v. Errington, 1952-1 All ER 149 and Cobb v. Lane 1952-1 All ER 1199, and then observed as follows:-
"The following propositions may, therefore, be taken as well established: (1) To ascertain whether a document creates a license or lease, the substance of the document must be preferred to the form;(2) the real test is the intention of the parties--whether they intended to create a lease or a license; (3) if the document creates an interest in the property, it is a lease; but, if it only permits another to make use of the property, of which the legal possession continues with the owner, it is a license; and (4) if under the document a party gets exclusive possession of the property, prima facie, he is considered to be a tenant; but circumstances may be established which negative the intention to create a lease."
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 These propositions have been quoted with approval subsequently by a Bench of three Judges in Konchada Ramamurty Subudhi (dead) v. Gopinath Naik and Ors. Reported in AIR 1968 SC 919, and in Capt. B.V. D'Souza v. Antonio Fausto Fernandes reported in AIR 1989 SC 1816.
19. (i) Having seen this legal position, we may now examine the submissions of the rival parties. It was submitted by Shri Ranjit Kumar, learned Senior Counsel that, it has to be noted that though the document of allotment states that the license is granted initially for a period of 15 years, Clause 8 thereof adds that it may be renewed for a further period of 15 years by enhancing the license fee maximum by 40%, and thereafter at such a percentage as may be decided by the authority. This indicated the permission to the allottee to remain on the concerned parcel of land for a period of 30 years and more, and should therefore be construed as creating an interest in the parcel of land. Therefore, in his submission the document of allotment created a lease, and renewal thereof was a matter of formality, and IDA was bound to renew the document. He referred to the judgment of this Court in Sudhir Kumar v. Baldev Krishna Thapar and Ors. V. Baldev Krishna Thapar and Ors. Reported in 1969
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 (3) SCC 611] to submit that a lessor cannot withhold his consent for renewal unreasonably.
(ii) Shri Vikas Singh, learned Senior Counsel appearing for IDA and Ms Vibha Datta Makhija, learned counsel for the State Government submitted on the other hand that the possession of the allottee was merely a permissive one, and that it was not exclusive to warrant an inference of creation of an interest. In their view, the document of allotment when read in the entirety makes it very clear that it was a license and not a lease."
32. The principal question to be considered is, as to whether the occupation of the premises by the defendant is by "lease" or "leave and licence". In light of the provisions stated supra and the decision of the Apex Court placed by the learned counsel for the appellant and the material placed before this Court, it is evident that the defendant is in possession of the suit schedule property as a "leave and licence" and not as a "lessee" as contended by the defendant and the first appellate Court was not justified in holding that the occupation of the premises by the defendant is as a "lessee".
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006
33. The first appellate court holds that the suit of the plaintiff is not maintainable under Section 118 of the Co- operative Societies Act. In order to answer the substantial question of law, the necessary provisions of the Co- Operative Societies Act needs to be looked into.
34. Section 70 of the Co-Operative Societies Act is a provision under the Co-Operative Societies Act, which oust jurisdiction of the Civil Courts and explains what are the matters that can be referred under Section 70 of the Co- Operative Societies Act to the competent code, which reads as under:
"70. Disputes which may be referred to Registrar for decision. --
(1) Notwithstanding anything contained in any law for the time being in force, if any dispute touching the constitution, management, or the business of a co-operative society3 [XXXX] arises,--
(a) among members, past members and persons claiming through members, past members and deceased members, or
(b) between a member, past member or person claiming through a member, past member or deceased member and the society,
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 its 1[board] or any officer, agent or employee of the society, or
(c) between the society or its 2[board] and any past 3[board], any officer, agent or employee, or any past officer, past agent or past employee or the nominee, heirs, or legal representatives of any deceased officer, deceased agent, or deceased employee of the society, or
(d) between the society and any other co- operative society, 4[or a credit agency] such dispute shall be referred to the Registrar for decision and 5[no civil or Labour or Revenue Court or Industrial Tribunal] shall have jurisdiction to entertain any suit or other proceeding in respect of such dispute.
(2) For the purposes of sub-section (1), the following shall be deemed to be disputes touching the constitution, management or the business of a cooperative society, namely:--
(a) a claim by the society for any debt or demand due to it from a member or the nominee, heirs or legal representatives of a deceased member, whether such debt or demand be admitted or not;
(b) a claim by a surety against the principal debtor where the society has recovered from the surety any amount in respect of any debt or demand due to it from the principal debtor, as a result of the default of the principal debtor whether such debt or demand is admitted or not;
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 6 [(c) any dispute arising in connection with the election of a President, Vice-President or any office-bearer or Member of board of the society;] 7 [(d) any dispute between a co-operative society and its employees or past employees or heirs or legal representatives of a deceased employee, including a dispute regarding the terms of employment, working conditions and disciplinary action taken by a co-operative society 1[notwithstanding anything contrary contained in the Industrial Disputes Act, 1947 (Central Act 14 of 1947)];
(e) a claim by a co-operative society for any deficiency caused in the assets of the co- operative society by a member, past member, deceased member or deceased officer, past agent or deceased agent or by any servant, past servant or deceased servant or by its 2 [board], past or present whether such loss be admitted or not.] (3) If any question arises whether a dispute referred to the Registrar under this section is a dispute touching the constitution, management or the business of a co-operative society, the decision thereon of the Registrar shall be final and shall not be called in question in any court.
3[(4)XXXXX.
(5) XXXXX.]"
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006
35. Section 118 of the Co-Operative Societies Act is the connecting provision to Section 70 of the Co-Operative Societies Act, which reads as under:
"118. Bar of jurisdiction of Courts.-(1) Save as provided in this Act, no 1[Civil, Labour or Revenue Court or Industrial Tribunal] shall have jurisdiction in respect of,-
(a) the registration of a co-operative society or bye-laws or of an amendment of a bye-law;
(b) the removal of a member or the removal and disqualification of a director or the removal of a board;
(c) any surcharge application required under Section 69 or any dispute required under Section 70 to be referred to the Registrar or the recovery of moneys under Section 100 or the execution of any award or order referred to the Registrar for execution under Section 101.]
(d) any matter concerning the winding up and the dissolution of a co-operative society.
(2) While co-operative society is being wound up, no suit or other legal proceedings relating to the business of such society shall be proceeded with, or instituted against, the Liquidator as such or against the society or any member thereof, except by leave
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 of the Registrar and subject to such terms as he may impose.
(3) Save as provided in this Act, no order, decision or award made under this Act shall be questioned in any Court on any ground whatsoever."
36. A conjoint reading of the above provision, it clearly discloses that when the dispute is between the members, past members and persons claiming through members, past members and deceased members and between the society or its any officer, agent or employee or any past officer, past agent or past employee or nominee, heirs or legal representatives of any deceased officer, deceased agent, or deceased employee of the society or between the society and any other Co-Operative Society or a credit agency and if the dispute falls under Section 70 of the Co-Operative Societies Act, Civil Courts have no jurisdiction to entertain any suit. In the present case, the defendant is not a member, nor the dispute touch the constitution, management or business of the Co-Operative Society as envisaged under Section 70 (2) (a) to (d) of the
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 Co-Operative Societies Act and goes without saying that the dispute does not relate either to the constitution, management or the business of the Co-Operative Societies to attract Section 70 and barring the suit under Section 118 of the Co-Operative Societies Act, what is assailed by the co-operative society is the possession from the defendant who has been put in "permissive possession". The first appellate Court has erroneously come to the conclusion that the plaintiff's suit is not maintainable and he has to raise a dispute under Section 70 of the Co-operative Societies Act and though the plaintiff is a Co-operative Society registered under the Karnataka Co-operative Societies Act and the defendant is not the Member of the Society nor he has borrowed any loan, therefore the question of raising a dispute under Section 70 of the Co-Operative Societies Act would not arise.
37. Accordingly, the substantial question of law framed by this Court is answered in favour of the appellant/plaintiff and the reasoning of the first Appellate
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 Court is unsustainable and under such circumstances, the entire reasoning of the first appellate Court is one perversity and illegality warranting interference by this Court and this Court pass the following:
ORDER
(i) The regular second appeal is hereby allowed.
(ii) The judgment and decree of the first appellate Court is set aside.
(iii) At this stage, learned counsel for the respondent seeks some time to vacate the suit schedule property, this Court, noting that the respondent is in possession, grants four months from the date of release of this order to vacate and handover the vacant possession of the suit schedule property, subject to the undertaking affidavit to be filed by the respondent within four weeks from the date of release of this order.
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NC: 2023:KHC-D:14157 RSA No. 2737 of 2006 In the light of the disposal of the appeal, pending applications, if any, would not survive for consideration and the same are accordingly disposed of.
Sd/-
JUDGE PJ & VNP, CT: UMD List No.: 1 Sl No.: 60