Sukanraj vs Nekarchand on 12 October, 1968
20. It has next been argued by Mr. Bhandari that as document Ex. 1 could not create a lease of the suit premises because of the non-compliance of the provisions of Section 107 of the Transfer of Property Act, it should be held that there was only a licence in favour of the defendant and that it was not therefore necessary to give a notice for its termination. The learned counsel has based his argument on the decision in Dau Dayal v. Brij Mohan, AIR 1952 All 344. In that case the defendant usufructuarily mortgaged a house to the
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laintiffs and executed a "kabuliyat" where-by he promised to pay the sum of Rs. 13 per month as rent for a period of 5 years. No lease, as provided in Section 107 of the Transfer of Property Act, was executed or signed both by the lessors and the lessee, but the "kabuliyat" was registered. The period of 5 years came to an end and the plaintiff served a notice on the defendant to vacate the house. As the defendant did not comply with the notice, a suit for ejectment was filed, but no claim for arrears of rent was included in that suit. While the ejectment suit was pending, the suit which gave rise to the appeal before their Lordship was filed for recovery of rent. It was held that the "kabuliyat" failed to create a lease whether for a term exceeding one year or for a lesser term, because it was executed only by the lessee. Their Lordships observed that as it had not been alleged that there was an oral agreement accompanied by delivery of possession and that a lease was created thereby, there was no lease at all. They took the view that since the "kabuliyat" "certainly exhibited a contract between the parties to pay a certain amount every month in lieu of the occupation of the house," it was a licence as it was not a lease. It was held that such
a contract was perfectly permissible and could not be said to be illegal or void on the ground that it defeated the provisions of any law. In particular, their Lordships observed that "under Section 23 of the Contract Act, such a contract does not defeat the provisions of Section 107 of the T. P. Act, because by its execution the executant does not obtain the rights of a lessee." They therefore concluded that no interest in immoveable property was created in his favour and he could be ejected at any time inspite of the "kabuliyat". A perusal of the judgment shows that their Lordships did not consider the effect of the facts that the possession of the defendant was permissive, and he had paid, and the plaintiff had accepted, the payment of the rent. In other words, their Lordships did not consider the question of the creation of a lease by an oral agreement accompanied by delivery of possession and excluded that eventuality by the observation that it was not alleged in the case that there was an oral agreement accompanied by delivery of possession and that a lease was created thereby. When their Lordships did not consider that question, it cannot be said that they have taken a contrary view. Moreover, if I may say so with respect, it was hardly necessary to give the finding that a licence was created in respect of the suit premises when no such plea had been taken. In the present case, however, it has clearly been pleaded in the plaint as well as in the replication that a lease was created between the parties and there is no reason why, in the absence of any legal impediment, effect should not be given to that intention.