Case: Dr. K. A. Dhairyawan And Others Vs. J. R. Thakur And Others

1. The appellants, as trustees, of the Mankeshwar Temple Trust had filed suit No. 2325 of 1948 in the High Court of Bombay in its Ordinary Original Civil Jurisdiction, for a declaration that they were entitled to the building in suit and were entitled to claim possession of the same and to recover the rents and profits thereof. The appellants further prayed that the defendants may be ordered and decreed to obtain a letter of allotment from the tenants of the said property attorning to the appellants that the first defendant may be ordered to render accounts of the rent received by him from the tenants of the said property from May 23. 1948, and that pending the hearing of the suit a Receiver may be appointed of the property in suit. The appellants had obtained leave of the High Court under O. II, R. 2 of the Civil Procedure Code reserving to them liberty to file a separate suit with respect to the land on which the building was situated. The learned Judge who heard the suit decreed it in part in favour of the appellants. He also passed an order of injunction restraining the defendants 1, 2 and 5 their agents and servants, from interfering with the exercise of the right of the appellants in obtaining possession of the building or otherwise effectuating their possession consistently with then provisions of law. He further directed the first defendant to account for the rents recovered by him from and after May 23, 1948, till the date of the decree. He refused to grant the prayer that the defendants be directed to obtain letters of attornment from the tenants of the building in favour of the appellants. Against this decision the defendants appealed and a Division Bench of the High Court allowed the appeal, reversed the decision of the trial Judge and dismissed the suit with costs.2. On May 23, 1927, Krishnarao Ganpatrao and Shamrao Ganpatrao, as trustees of the Mankeshwar Temple, executed a registered lease, Exbt. A, in favour of Moreshwar Kashinath and Radhabai, wife of Ramkrishana Bhai Thakore, whereby they demised a parcel of land specified in the Schedule to the document. The lease was for twenty-one years. The area of land was about 231.66 square yards and the rent reserved as Rs. 50 per month. Under the terms of the lease the lessee had to construct within six months from the date of the lease a double storeyed building consisting of shops on the ground floor and residential rooms on the upper floor. The cost of construction was to be not less than Rs. 10, 000. The construction had to be to the satisfaction of the lessors engineers. There were certain restrictive covenants in the lease. The building had to be insured for at least Rs. 12,000 in the joint names of the lessors and the lessees with an insurance firm approved by the lessors. If the building was damaged or destroyed it had to be repaired or restored by the use of the insurance money received from the insurance company. On the termination of the lease either at the end of twenty-one years or earlier, the lessees were to surrender and yield up the demised premises including the building with its fixtures and appurtenances to the lessors without any compensation for the same. On May 14, 1948, shortly before the lease was to expire, the appellants who were then the trustees of the temple gave notice to the respondents to deliver possession of the demised premises and the building on the expiry of the lease, that is to say, on May 22, 1948. On May 19, 1948, the respondents replied that they were entitled to the benefits of the provisions of the Bombay of Rents, Hotel and Lodging House Rates Control Act, 1947, hereinafter referred to as the Act, and that the appellants were not to interfere with their possession. All that they could get was the rent under the lease for the respondents. On July 23, 1948, the appellants gave the respondents notice to quit the building only as in their opinion the Act did not apply to it. On July 27, 1948, the respondents, replied asserting that the Act did apply to it. The appellant, accordingly, filed the present suit in the High Court on September 1, 1948.3.The period of the lease under Exbt. A having expired and the respondents having been given notice to quit, they were bound to vacate the demised premises unless they were protected by the provisions of the Act. Land used for non-agricultural purposes is "premises" under the Act. Although the period of the lease had expired the respondents continued to remain in possession without the assent of the lessors. Under the Act they would therefore, be tenants of the land within the meaning of that expression as defined in the Act. There can be no question that so far as the land demised by the lease is concerned the respondents could not be evicted so long as they complied with the provisions of Act and the lessors, as landlords were unable to resort to any of the provisions of S. 13 of the Act to evict the respondents from the land. Indeed, the appellants did not claim in the plaint that they were entitled to evict the respondents from the demised land. The plaint, as drafted, confined the reliefs claimed by the appellants only to the building constructed on the land.

Court's reasoning:
7. Normally, under S. 108 of the Transfer of Property Act, before the expiry of the lease, a lessee can remove all structures and buildings erected by him on the demised land. All that was necessary for him to do was to give back the land to the lessor, on the termination of the lease, in the same condition as he found it. The ownership therefore, of the building in this case was not with the lessors but was with the lessees. Under S. 108 of the Transfer of Property Act there was nothing to prevent the lessees contracting to hand over any building or structure erected on the land by them to the lessors without receiving any compensation. In other words, although under S. 108 the lessees had the right to remove the building, by the contract they had agreed to hand over the same to the lessors without the right to receive compensation at the end of the lease, the matter being entirely one of contract between the parties. Such a contract, however did not transfer the ownership in the building to the lessors while the leaseownership in the building to be constructed did not pass on to the lessors under the lease. During the subsistence of the lease the ownership of the building remained with the lessees. The lessees contracted to hand over the building without compensation at the end of the lease and in consideration for this the lessees were being demised the land at a small rental of Rs. 50 per month. We have examined the various clauses of the lease and are satisfied that not one of them, if properly construed, indicates that there was any contract between the parties to the effect that the building to be erected on the land would be in the ownership of the lessors and that the same would be deemed to have been demised to the lessees along with thecontention is without force as the provisions of the Act do not provide for the continuation of a lease beyond the specified period stated therein. All that the Act does is to give to the person who continues to remain in possession of the land, although the period of the lease had come to an end, the status of a statutory tenant. That is to say, although the lease had come to an end but the lessee continued to remain in possession without the consent of the lessor, he would nonetheless be a tenant of the land and could not be evicted save as provided by theseems to us, however, that the suit cannot be dismissed merely on this ground because the nature of the declaration which the appellants sought could be granted even in the absence of the heirs and representatives of defendant No. 4 being on the record. Though the plaintiffs impleaded 5 persons as defendants in the suit, the plaintiffs claimed a decree against the first defendant only in respect of the rents received by him from the tenants in the building in question. There is no claim against the other defendants for accounts in respect of the usufruct of the property. The correspondence disclosed in the suit, which passed between the plaintiffs and the first defendant, showed that it was only he who was in effective control of the building. The suit was contested only by the first three defendants who appear to be brothers and who claim to have continued in possession of the building after the crucial date i.e., May 22, 1948. It is they who claimed protection under the Act. Defendants 4 and 5, who were purported to be sued as representatives of one of the joint lessees, do not appear to have taken any interest in the building. After the suit, defendant No. 5 has remained ex parte throughout. After the decree of the trial court, it is only the first three defendants who preferred an appeal to the High Court. From all these considerations, it appears that the 4th defendant or her heirs or legal representatives were not necessary parties to the suit. The Court could, therefore, proceed with the suit in their absence.