* HON’BLE SRI JUSTICE B. CHANDRA KUMAR + Second Appeal No. 511 of 2008 % 23.03.2011 # K. Sajjan Raj .. Appellant/Appellant/Defendant Vs. $ Gopisetty Chandramouli .. Respondent/Respondent/Plaintiff <GIST: >HEAD NOTE: ! Counsel for Appellant : Sri B.V. Bakshi ^ Counsel for respondent : Sri R. Chandrashekar Reddy ? CASES REFERRED : 1. AIR 1950 Supreme Court 1 2. AIR 1992 Calcutta 47 3. 2010(6) ALD 765 THE HON’BLE SRI JUSTICE B. CHANDRA KUMAR Second Appeal No. 511 of 2008 Judgment: This appeal is directed against the judgment and decree dated 03.03.2008 passed in A.S. No.149 of 2006 by the I Additional Chief Judge, City Civil Court, Secunderabad, confirming the judgment and decree dated 25.07.2006 passed in O.S. No. 770 of 2004 on the file of the I Junior Civil Judge, City Civil Court, Secunderabad. The appellant herein is the defendant in the original suit. The parties hereinafter will be referred to as they are arrayed before the trial Court for the sake of convenience. The plaintiff is the owner of the building in which the suit schedule Mulgi is situated. The father of the defendant was inducted as tenant in the suit schedule premises in the year 1952. After his demise, the defendant became a tenant. Initially, the monthly rent was at Rs.500/-, but subsequently the same was enhanced to Rs.1100/- per month, exclusive of electricity consumption charges, from December 2001. The tenancy is month to month commencing from first of the month to end of the month according to English Calendar. The plaintiff issued a quit notice dated 28.05.2004 terminating the tenancy and calling upon the defendant to vacate the premises and handover the vacant possession of the suit premises within 15 days from the date of service of the notice. The said notice was sent through speed post as well as under certificate of posting. Though the registered envelop was returned with an endorsement “as not claimed returned to Sender”, but the plaintiff’s case is that the notice sent under certificate of posting was served on the defendant. Since the defendant failed to vacate the premises, the plaintiff filed the suit for eviction. The plaintiff also averred that the premises under the occupation of the defendant would fetch a rent of Rs.5000/- and therefore the defendant is liable to pay Rs.5,000/- per month towards mesne profits/damages for the use and occupation of the property from the date of suit till the date of delivery of vacant possession. The defendant resisted the claim of the plaintiff and denied that he did not claim the notice sent by the plaintiff. His specific case is that he left for Rajastan on pilgrimage on 30.05.2004 and returned to Secunderabad only in the night of 20th June 2004 and that he did not receive any notice prior to 30.05.2004 from the plaintiff and that he had learnt about the notice sent under certificate of posting only on 21.06.2004. His main case is that after his return from pilgrimage he tried to contact the plaintiff on 21.06.2004, but he could not contact the plaintiff and at last on 24.06.2004 he met the plaintiff and the plaintiff agreed to talk with him after about one week. Then the defendant again met him on 02.07.2004 and they again met on 06.07.2004 and finally agreed to renew the lease on the following terms. (a) that the lease shall be for a period of twenty (20) years; commencing from 01.06.2004. (b) That, the monthly rent shall be Rs.2,000/- (Rupees Two Thousands only) exclusive of electricity consumption charges, to be enhanced by 20% for every five years. (c) That, the monthly rent shall be payable on or before 5th of every month. (d) That, the premises should not be sub-let or the nature of business be changed, nor any partnership be entered into to carry on the business without prior written permission of the landlord. (e) That, this lease deed should be got registered within 4 months from 06.07.2004; and the stamp and registration charges therefor be shared equally by the Lessor and the Lessee. All the other conditions as are envisaged in the Transfer of Property Act. It is also the specific case of the defendant that the plaintiff did not inform him about the filing of the suit when he met the plaintiff on the above mentioned dates. The further case of the defendant is that in compliance of the said arrangement, the plaintiff had been receiving the renewed rent of Rs.2,000/- per month from 01.06.2004 and that on 10.07.2004 the plaintiff received the monthly rent for the months of June and July 2004 and passed receipts. Thus, the specific case of the defendant is that in view of the subsequent agreement and renewal of lease, the suit became infructuous. On behalf of the plaintiff, the plaintiff himself was examined as PW.1 and Exs.A1 to A5 were marked. On behalf of the defendant, the defendant himself was examined as DW.1 and one S. Prakash was examined as Dw.2 and Exs.B1 to B7 were marked. The learned Junior Civil Judge, having appreciated the evidence, came to the conclusion that when the plaintiff had sent a notice dated 28.05.2004 through speed post to the defendant and when it is returned as not claimed and when the notice is sent to the correct address, it is deemed that there is service of notice. It is also observed that non-filing of rejoinder by the plaintiff would not automatically prove the averments made by the defendant. The learned Judge also held that the defendant did not produce even an iota of evidence with regard to alleged renewal of lease and with regard to terms and conditions of the fresh renewal agreement. Holding so, the suit was decreed. Aggrieved by the same, the defendant carried the matter in appeal. The lower appellate Court also disbelieved the version of the defendant with regard to fresh lease agreement and further observed that subsequent payment of Rs.2,000/- per month also not in conformity with the alleged fresh lease agreement and accordingly dismissed the appeal. Challenging the said judgment, the defendant filed the present second appeal. Sri B.V. Bakshi, learned counsel for the defendant/appellant, submitted that the defendant had been on pilgrimage during the relevant period and that he did not receive the notice sent by the plaintiff and that after his return the defendant had contacted the plaintiff and there was fresh agreement of lease extending the lease by a period of 20 years and enhancing the rent to Rs.2000/- per month and that this agreement was acted upon. His main submission is that the plaintiff admitted that he has received the rents at Rs.2000/- per month and this circumstance clearly supports the version of the defendant that there was renewal of the earlier lease. It is also his contention that when the defendant met the plaintiff he was not even informed that the plaintiff filed a suit for eviction of the defendant and that after the defendant received summons in the suit and when he filed a suit for specific performance, the plaintiff stopped receiving the rents. His main submission is that when the defendant had taken a specific plea about the fresh lease agreement and when the plaintiff has not denied the same by filing a rejoinder it amounts to admission, and as per the provisions of Section 58 of the Indian Evidence Act an admitted fact need not be proved. It is also his submission that once a fresh lese agreement has been entered into between the parties and acted upon, the earlier quit notice becomes ineffective. It is also his submission that the courts below failed to appreciate the evidence in proper perspective and simply held that the defendant failed to prove the fresh lease agreement. It is also his submission that an unregistered agreement of lease is admissible in evidence under Section 49 of the Registration Act as evidence of part performance. In support of his contention, he has relied on the judgment in case between Maneklal Mansukhbhai v. Hormutsji Jamshedji Ginwalla and sons[1]. It is also his submission that specific performance can be ordered even where the agreement to sell is oral and where a property has been delivered in pursuance of the agreement of sale. Learned counsel for the respondent/plaintiff submitted that the plaintiff has issued quit notice to the correct address of the defendant and the same has been admitted by the defendant and when a notice is sent to the correct address it is deemed to have been served and therefore the finding of the Courts below on this aspect is correct. It is also his submission that the plaintiff in his notice had categorically mentioned that the defendant is liable to pay damages at Rs.5000/- per month till the vacant possession of the premises was delivered to him and any amount paid by the defendant after termination of tenancy would be accepted under protest and without prejudice to his contentions. It is also argued that as far as denying the averments made by a party are concerned the defendant in a suit is required to deny all the material averments made by the plaintiff under Order VIII Rule 3 CPC and if any averment is not specifically denied the same amounts to an admission under Order VIII Rule 9 CPC. It is also his contention that admittedly the defendant did not make any counter claim or pleaded set off and only in case where the defendant had claimed counter claim or pleaded set off then it becomes obligatory on the part of the plaintiff to file a rejoinder to the said counter claim or set off under Order VIII Rule 6-A CPC. It is his specific submission that merely because the plaintiff did not file rejoinder that will not amount to an admission. It is also his submission that after amendment of the Registration Act by Act 4 of 1999, agreement of lease must be registered one and if not registered, such agreement of lease is invalid. It is also submitted that the judgments relied on by the defendant are not applicable to the facts of this case, since they are based on Section 53(a) of the Transfer of Property Act., i.e., where possession has been delivered in pursuance of the agreement of sale and that situation did not arise in this case. The substantial question of law that arises for consideration is that when a pleading in the written statement is not denied by filing a rejoinder whether such pleading in the written statement can be taken as admission. It is not in dispute that the plaintiff is the owner of the premises and that the defendant is a tenant of the said premises and monthly rent of the said premises was at Rs.1100/- before the dispute arose between the parties. The specific case of the plaintiff is that he got issued a quit notice dated 28.05.2004 calling upon the defendant to hand over the vacant possession of the premises and that the defendant evaded to receive the notice. Admittedly, the notice Ex.A1, dated 28.05.2004, was sent by speed post. Ex.A2 is the speed post receipt, Ex.A3 is the returned registered envelop and Ex.A4 is the certified copy of posting coupon. It is an admitted case that the notices were sent to the correct address of the defendant. Therefore, the finding of the lower Court, that when a notice has been sent to the correct address of a party and when the same has been returned ‘as not claimed’, the same amounts to service of notice, need not be disturbed. Though the defendant claimed that he was not in the town and that he had been on pilgrimage and that he left Secunderabad on 30.05.2004, but the documents filed by him, particularly the railway ticket Ex.B6, go to show that he left Secunderabad on 31.05.2004. A perusal of the postal endorsement reveals that the postman went to the address of the defendant on 29.05.2004 and on 31.05.2004. Therefore, the contention of the defendant that he was not available in Secunderabad when the said notice was tendered also appears to be not correct. However, since no arguments have been advanced on this point, there is no need to discuss this issue any further. The only claim of the defendant is that subsequently there was an oral agreement between the parties by which the lease was extended on certain terms and conditions and in pursuance of that oral agreement he has paid monthly rent of Rs.2000/- to the plaintiff and that the plaintiff has accepted the same. It is a fact that the defendant has made a specific averment in his written statement about the renewal of the lease and with regard to fresh agreement of sale on 06.07.2004. It is also mentioned as per the agreed terms the lease period is extended by another 20 years commencing from 01.06.2004 on a monthly rent of Rs.2,000/- exclusive of electricity consumption charges and the said rent has to be enhanced by 20% for every five years. Admittedly, the plaintiff has not filed any rejoinder. Order VIII CPC deals with the filing of written statement by a defendant. Rule 2 of Order VIII is as follows. 2. New facts must be specially pleaded.- The defendant must raise by his pleading all matters which show the suit not to be maintainable, or that the transaction is either void or voidable in point of law, and all such grounds of defence as, if not raised, would be likely to take the opposite party by surprise, or would raise issues of fact not arising out of the plaint, as, for instance, fraud, limitation, release, payment, performance, or facts showing illegality. Thus, Rule 2 of Order VIII envisages that new facts such as that the suit is not maintainable or that the transaction is either void or voidable in law and also all such grounds of defence such as fraud, limitation, release, payment, performance, or facts showing illegality must be specifically raised. Rule 3 of Order VIII specifies that the denial of plaint averments must be specific i.e., each allegation made by the plaintiff must be specifically denied. Sub-rules (1) and (2) of Rule 5 of Order VIII are as follows. 5. Specific denial.-(1) Every allegation of fact in the plaint, if not denied specifically or by necessary implication, or stated to be not admitted in the pleading of the defendant, shall be taken to be admitted except as against a person under disability: Provided that the Court may in its discretion require any fact so admitted to be proved otherwise than by such admission. (2) Where the defendant has not filed a pleading, it shall be lawful for the Court to pronounce judgment on the basis of the facts contained in the plaint except as against a person under a disability, but the Court may, in its discretion, require any such fact to be proved. Thus, under Order VIII Rule 5, the allegation of fact made in the plaint if not denied, is to be taken as admitted. Rule 6 of Order VIII deals with the set-off, which is as follows. 6. Particulars of set-off to be given in written statement.-(1) Where in a suit for the recovery of money the defendant claims to set-off against the plaintiff’s demand any ascertained sum of money legally recoverable by him from the –plaintiff, not exceeding the pecuniary limits of the jurisdiction of the Court, and both parties fill the same character as they fill in the plaintiff’s suit, the defendant may, at the first hearing of the suit, but not afterwards unless permitted by the Court, present a written statement containing the particulars of the debt sought to be set-off. (2) Effect of set-off.-The written statement shall have the same effect as a plaint in a cross-suit so as to enable the Court to pronounce a final judgment in respect both of the original claim and of the set-off: but this shall not affect the lien, upon the amount decreed, of any pleader in respect of the costs payable to him under the decree. (3) The rules relating to a written statement by a defendant apply to a written statement in answer to a claim of set-off. Thus, the effect of plea of set-off shall have the same effect as a plaint in a cross-suit and when the plaintiff files an answer to a claim of set-off the rules relating to a written statement shall apply to such answer. Thus, the plaintiff steps into the shoes of the defendant while filing an answer to the claim of a set-off pleaded by the defendant. Rule 6A deals with a counter claim by the defendant and the counter claim has to be treated as a plaint and governed by the rules applicable to plaints under sub-rule (4) of Rule 6A and the plaintiff shall be at liberty to file a written statement in answer to the counter- claim of the defendant within such period as may be fixed by the Court under sub-rule (3) of Rule 6A. Rule 6B is as follows. 6B. Counter-claim to be stated.-Where any defendant seeks to rely upon any ground as supporting a right of counter-claim, he shall, in his written statement, state specifically that he does so by way of counter-claim. It is not the case of the learned counsel for the defendant/appellant that the defendant sought to rely upon any ground as supporting a right of counter-claim nor that he has specifically mentioned that he does so by way of counter claim in this case. Thus, it is clear that the appellant herein did not follow Rule 6-B as quoted above. Rule 7 of Order VIII is as follows. 7. Defence or set-off founded upon separate grounds.- Where the defendant relies upon several distinct grounds of defence or set-off or counter-claim founded upon separate and distinct facts, they shall be stated, as far as may be, separately and distinctly. Rule 8 of Order VIII is as follows. 8. New ground of defence.-Any ground of defence which has arisen after the institution of the suit or the presentation of a written statement claiming a set-off or counter-claim may be raised by the defendant or plaintiff as the case may be, in his written statement. Rule 9 of Order VIII is as follows. 9. Subsequent pleadings.-No pleading subsequent to the written statement of a defendant other than by way of defence to set-off or counter-claim shall be presented except by the leave of the Court and upon such terms as the Court thinks fit; but the Court may at any time require a written statement or additional written statement from any of the parties and fix a time of not more than thirty days for presenting the same. Thus, Rule 9 of Order VIII specifies that no pleading subsequent to the written statement of a defendant other than set-off or counter- claim shall be presented without the leave of the Court. Learned counsel for the defendant/appellant could not show any provision to show that if any allegation made in the written statement is not denied specifically the same amounts to admission by the plaintiff. No such provision appears to be available under the Code of Civil Procedure. Therefore, what the law envisages is that as far as the defendant is concerned, he has to deny the specific averments or allegations made by the plaintiff and when the defendant makes a specific plea of set-off or counter claim, then only the plaintiff is required to file an answer to the counter claim or the set-off pleaded by the defendant. As far as the other averments made by the defendant, which do not come within the definition of set-off or counter claim, the plaintiff is not required to answer the same. Therefore, non-filing of any answer by the plaintiff to the specific pleading of the defendant that there was fresh lease or the renewal of lease on 06.07.2004 cannot be taken as an admission made by the plaintiff. Learned counsel for the defendant/appellant submits that though the renewal of lease or fresh lease is not registered, but when the circumstances point out that the said agreement was acted upon, a formal lease is not necessary to attract the application of Section 53A of the Specific Relief Act. He has relied on a decision reported in Maneklal Mansukhbhai v. Hormutsji Jamshedji Ginwalla and sons (1 supra). In that case, the appellant desired to erect a ginning factory and with that object approached the Talukdari Settlement Officer for permanent lease of certain lands. The said Officer agreed to grant a lease subject to sanction of the Government. The Government of Mumbai granted requisite sanction and to that effect a letter was sent to the Commissioner and to the Talukdari Settlement Officer by the Chief Secretary to Government. Then the factory was set up and the Talukdari Settlement Officer continued to receive the rents. However, the agreement of lease was not registered. Section 53 of the Transfer of Property Act came to be considered in that case. The issue was whether the transfer could be ascertained with reasonable certainty. Ex.181 is the resolution, by which the Government of Mumbai granted requisite sanction. The apex Court observed as follows. “……………..Once it is held that Ex.181 is good secondary evidence of the agreement of lease, there can then be no hesitation in holding that by an offer and an acceptance made in writing and signed by the respective parties an agreement was completed between the Talukdari Settlement Officer and the predecessor-in- interest of the defendant and that necessary sanction of the Government was also in writing signed by the officer concerned. It has further to be held that the terms of the contract can be fairly deduced from the recitals of this document.” In that case, the lessee had taken possession in part performance of the agreement, but also paid rents continuously for some period. In the above circumstances, it was held that an agreement of lease creating a present demise but not registered is admissible under Section 49 of the Registration Act as evidence of part performance and Ex.181 is secondary evidence of that agreement. It was further observed that a formal lease is not necessary to attract the application of Section 53-A of the T.P. Act. All that is required is that an agreement in writing signed by the transferor can be gathered from the evidence. The correspondence mentioned in Ex.181 fully establishes that fact. The facts of that case are entirely different to the facts of the present case. In that case, in pursuance of the agreement of lease possession was delivered to the lessee and the plaintiff who disputed the agreement of lease admittedly did not produce necessary documents which were in its possession and an adverse inference was drawn against the plaintiff in that case. More over, the facts and circumstances of that case reveal that the agreement was acted upon and secondary evidence as in Ex.181 was available in that case. Admittedly, in this case, the lease agreement is not registered. More so, there is no written agreement at all. The defendant pleads only an oral agreement of lease. That too, the lease period is said to be extended by 20 years. Except the self-serving statement of the defendant, there is no iota of evidence to show that there was an oral agreement between the plaintiff and defendant extending the lease for another period of 20 years. It has to be seen that the defendant had already come to know about the quit notice issued by the plaintiff. He was informed that a notice has been received under certificate of posting and then he says that he approached the plaintiff on 21.06.2004 and on 24.06.2004 and again on 04.07.2004 and on 06.07.2004. It is not the case of the defendant that he had taken any mediators along with him. When the