Case: Biswabani Private Limited Vs. Santosh Kumar Dutta and Others

Kalpana Theatre with its furnishings and fixtures situated at 61, Chintamoni Dey Road, Howrah, belonging to respondents 1 and 2 is the subject matter of dispute between its landlords and tenant awaiting resolution for the last two decades. Under a registered lease deed dated 11th September 1948 respondent 3 Kanti Bhusan Bose, took this Theatre on lease for a period of 5 years with effect from 1st September 1948. Respondent 3 is the Managing Director of the appellant Biswabani Pvt. Ltd. (company for short). It appears that during the period of lease respondents 1 and 2, the owners of the Theatre, accepted the appellant company as their tenant and in token of it accepted rent from the company at the rate of Rs. 2, 000/- p.m. On the expiry of the period of 5 years disputes arose between the lessors and the lessee whereupon respondents 1 and 2 lessors commenced an action in ejectment against the company on 5th October 1953 in the Court of the First Subordinate Judge, Howrah. In August 1953 appellant company as lessee filed an application before the Rent Controller under the West Bengal Premises Rent Control (Temporary Provisions) Act, 1950, for fixation of standard rent of the demised premises. Ultimately the parties arrived at a compromise and the consent terms were filed in T.S. No. 68 of 1953 instituted by the lessors respondents 1 and 2 for eviction of the company and the Court was invited to pass a decree in terms thereof. The consent decree, inter alia provided that the company would be the tenant of Kalpana Theatre on a monthly rent of Rs. 1, 000/- from 1st March 1955 for a period of 5 years and that the third respondent Kanti Bhusan Bose had to offer security by deposit of G.P. Notes of the face value of Rs. 20, 000/- with the lessors. The lease was to be for a period of 5 years commencing from 1st March 1955. An indenture of lea se was to be drawn up and executed by both the parties in terms of the consent decree. The company was given permission to sublet the premises with prior approval of the lessors. There is a furious controversy about one of the terms of the consent decree which reads asthe period of five years there shall be no renewal of the lease, the lessee shall be treated asthe expiry of the term of five years on 29th February 1960 it appears t hat respondents 1 and 2 lessors locked up a portion of the demised premises whereupon the company filed a suit on 14th March 1960 against respondents 1 and 2 lessors and the proforma respondent 3 for a declaration that the company was the tenant of the premises, and for a permanent injunction restraining respondents 1 and 2 from interfering with its tenancy rights. There was also a prayer for a mandatory injunction directing respondents 1 and 2 to remove the locks put by them on some portion of the demised premises and for reliefs incidental and ancillarysuit was, inter alia, contested on a contention that as the consent decree provided for a fresh lease of five years such a lease can only be valid if i t is registered and as the consent decree or the document incorporating the terms of compromise was not registered, the company continued in possession under a void lease and, therefore, on the expiry of the period of five years the company was a trespasser and respondents 1 and 2 were entitled to take over possession from such a trespasser. It was also contended that on the expiry of the period of five years on 29th February 1960 the company handed over peaceful and vacant possession to respondents 1 and 2 in terms of the consenttrial court held that as the consent decree provided for a lease for a period of five years in the absence of registration the lease for a period of five years did not come into existence but if the tenant entered into possession under an invalid lease and the landlord accepted rent a tenancy from month to month came into existence between the lessors and the lessee and that such a lessee cannot be evicted except after terminating the tenancy by a valid notice to quitand in the absence of such determination the lessee would be a lessee from month to month and can protect its possession. In accordance with this finding the trial court de creed the appellant-plaintiffs suit. Respondents 1 and 2 appealed to the District Court at Howrah. The learned Additional District Judge held that the lease being void, yet the lessors would not be entitled to disturb the possession of the tenant for a period of 5 years under the provisions of s. 53A of the Transfer of Property Act but after the expiry of the period of five years the appellant became a rank trespasser and the respondents 1 and 2 were entitled to take possession of the property. Accordingly the appeal was allowed and the companys suit was dismissed. The appellant company preferred second appeal to the High Court. The High Court broadly agreed with the findings of the learned Addl. Distt. Judge and dismissed the appeal. The High Court granted a certificate unfortunately very vague without specifying whether the certificate was under Article 133(a), (b) or (c) as it stood at the relevant time.The undisputed facts are that Kanti Bhusan Bose, 3r d respondent took on lease the demised premises under a registered lease need dated 11th September 1948, the period reserved under the lease being 5 years at a monthly rent of Rs. 2, 000/- with an option for renewal to be exercised by a notice two months before the expiry of the lease. It is equally undisputed that during this period of 5 years the appellant company was accepted as tenant of the demised premises and the company paid the rent reserved under the lease being Rs. 2, 000 /- p.m. The period reserved under the lease expired on 31st August 1953. But before the expiry of the period an application was made by the appellant for fixation of standard rent of the demised premises under the West Bengal Premises Rent Control (Temporary Provisions) Act, 1950. In October 1953 respondents 1 and 2 as lessors commenced an ejectment action against the appellant and third respondent on the ground that the period reserved under the lease has expired and the lessee has failed to exercise the option for renewal. During the pendency of the aforementioned actions the parties entered into a compromise and the consent terms were filed in the suit instituted by respondents 1 and 2 lessors inviting the Court to pass a decree in terms thereof, and a consent decree was passed which has been referred to in the evidence as solenama. It, inter alia, provides for a lease for a further period of 5 years commencing from 1st March 1955 on a monthly rent of Rs. 1, 00 0/- p.m. made up of a rent of Rs. 500/- for the premises and a rent of Rs. 500/- for furniture and fixtures and the lessee would have no further option of renewal of the lease on the expiry of the period reserved under the lease. This consent decree incorporating the terms of a fresh lease to be effective as a valid lease required registration in view of the provisions contained in s. 107 of the Transfer of Property Act read with s. 17(1)(d) ofthe Registration Act, 1908, because the period reserved under the lease was exceeding one year. It is an admitted position that the instrument containing terms of lease, i.e. either the consent terms or the consent decree was not registered as required by law. However, it is equally an admitted position that the company continued in possession and paid rent which was accepted by the lessors from the company from month to month. It appears that on 29th February 1960, i.e. the last day on which would expire the lease for a period of 5 years, the lessors respondents 1 and 2 entered into the demised premises and locked a portion thereof.

Reasoning:
We must accordingly steer clear of this position that neither the appellant relies on s. 53A to protect its possession nor would it be of any use or assistance because it can be a sheath and not a sword as the appellant has come to the Court for a declaration of its tenancy rights, seeking to protect its possession not under the doctrine of part performance as incorporated in s. 53A but with specific allegation that the appellant is a tenant and it be so declared, and for an injunction restraining respondents 1 and 2 landlords from interfering or disturbing the appellants possession of the premises asthis case it is unquestionably established that at the commencement of the lease which turns out to be void, i.e. on 1st March 1955 appellant was a tenant of the premises and that on its application standard rent in respect of the demised premises was determined and the same was accepted as the rent to be paid under the second lease. Payment has in fact been made and it would be twisting the language to hold that the payment was not made as rent but under the terms of the secondit would not be correct to hold that a tenant who was in possession of the demised premises as tenant and who negotiated a fresh agreement of lease with the landlord for a period exceeding one year which, in order to be legal, must be by a registered instrument and which turns out to be void for want of registration, would alter hi s position from one as tenant at the commencement of such void lease and would render him a licensee continuing in possession under the terms of a lease being void and, therefore, ineffective and that he ceases to be a tenant and could be forcibly removed at the end of the period which was reserved under the void lease. Such an incomplete and ineffective attempt at creating a fresh lease would have no impact on a tenant who was in possession as tenant at the commencement of such a void lease and he would continue to be the tenant because s. 53A would not be attracted as he is not put in possession in part performance of an agreement of lease not registered and that it would be unwise to hold that the payment of the standard rent fixed by the Rent Controller having jurisdiction could be by any process of construction treated as payment under such an agreement of lease. Therefore, it would appear that the appellant company was a tenant during the period 1948-53 and on the expiry of the contractual tenancy on 31st August 1953 it became a statutory tenant. A person remaining in occupation of premises let to him after the determination of or expiry of the period of the tenancy is commonly, though in law not accurately, called a statutory tenant. In other words, he acquires the status ofstatutory tenancy would, therefore, come to an end on either the surrender of premises by such a tenant or if a decree of eviction is passed against him (See Hiralal Vallabhram v. Kastorbhai Lalbhai &Ors.) (2) As the period reserved under the first lease expired an 31st August 1953 and thereafter the tenant continued in possession, it became a statutory tenant under the West Bengal Premises Rent Control (Temporary Provisions) Act, 1950. If thereafter an ineffective attempt was made to enter into a fresh contract of tenancy the status of the appellant as tenant did not undergo any change and it continued to be the tenant of the premises and the statutory tenancy would come to an end if it surrenders possession or is evicted by due process of law.If the appellant thus continued to be a tenant it could not be forcibly evicted. If the premises enjoyed the protection ofthe West Bengal Premises Tenancy Act, 1956, which was in force on 29th February 1960 when according to respondents 1 and 2 the period reserved under the void lease expired, respondents 1 and 2 cannot, ignoring the provisions of the relevant Rent Restriction law and merely treating the appellant as licensee or trespasser, ignoring its status of irremovability, take over forcible possession. In such circumstances the appellant as tenant would be entitled to protect its possession unless evicted in due course of law and in order to protect its possession it can legitimately sue, there being no bar in law, for a declaration of its status as tenant and for an injunction either prohibitory or mandatory, as the case may be. The High Court really missed the core problem and with respect misled itself into invoking the provisions of s. 53A which the learned counsel appearing for the present appellant declined to invoke in its favour and came to an unsustainable conclus ion that under the consent decree the parties agreed that the old tenancy would be wiped out and a new tenancy would be created for a period of 5 years expiring in February 1960. A still born attempt not clothed with legal formality cannot destroy the existing status. The second lease never came into existence for want of registration and more particularly the appellant was not put in possession under the purported second lease which turns out to beHigh Court was further in error in holding that if on the expiry of the agreed period of lease there was a covenant for not getting any renewal of the lease the tenant would be a trespasser, wholly overlooking the legal position as affirmatively established that on the expiry of the contractual tenancy the tenant continues as a statutory tenant except where he surrenders possession or is evicted under the enabling provisions of the relevant Rent Restriction Act.It thus clearly transpires that the appellant was a tenant and continued to be a tenant and was entitled to protect its possession by appropriate proceeding unless evicted in due course ofgranted by the High Court leaves much to be desired. It is merely stated that it is a case fit for appeal to the Supreme Court. It may be pointed out that the appellant had prayed for a certificate under Article 133(1)(a), (b) and (c) as it stood at the relevant time in 1969. I n the application for the certificate it was stated that the subject-matter of the suit and appeal to the Supreme Court will exceed Rs. 20, 000/- and that judgment is one of affirmance. It was also stated that the appeal involves a question of general public importance and, therefore, a certificate may be granted under Article 133(1)(a), (b) and (c). In the affidavit in opposition on behalf of respondents 1 and 2 it was stated that the value of the subject-matter of dispute was less than Rs. 20, 000/- and the appeal does not involve any question of law of general public importance which had to be determined by the Supreme Court. With these two affidavits before it, the High Court granted certificate that it is a fit case fo r appeal to the Supreme Court. A certificate which the High Court grants must be supported by adequate reasons. It is obligatory upon the High Court to set out the question of public or private importance which in their opinion falls to be determined in the proposedthis case a very substantial question of law of general public importance is raised and it would be a travesty of justice if we now dismiss the appeal on the sole ground that the certificate is defective. It would have been open to us to grant special leave on the question raised before us. Therefore, the preliminary objection must be overruled.