S.N. Sheopuri vs Fab India Overseas P. Ltd. on 4 July, 2011
This Court in
Badri Narain Jha v. Rameshwar Dayal Singh held that if a lessor purchases the whole of
the lessee's interest, the lease is extinguished by merger, but there can be no merger or
extinction where one of several joint holders of the mokarrari interest purchases portion
of the lakhraj interest. It was held that when there was no coalescence of the interest of
the lessor and the lessee in the whole of the estate, there could be no determination of the
lease by merger. We do not think that it is necessary to multiply authorities in the face of
the plain language of the provision and the authoritative pronouncements of the Privy
Council and of this Court referred to above. The position emerging from the relevant
provision of the Transfer of Property Act is that the lease or tenancy does not get
determined by the tenant acquiring the rights of a co-owner landlord and a merger takes
place and the lease gets determined only if the entire reversion or the entire rights of the
landlord are purchased by the tenant.‖