Pabitra
Kumar Roy & Anr Vs. Alita D' Souza [2006] Insc 622 (27 September 2006)
A.K.
Mathur & Altamas Kabir Altamas Kabir, J.,
The
appeal raises an interesting question of law relating to the interpretation of
Sub-section (2) of Section 3 of the West Bengal Premises Tenancy Act, 1956
(hereinafter referred to as 'the 1956 Act') which does not appear to have been
considered earlier for its full scope and effect. The question relates to the
applicability of Sub-section (2) of Section 3 of the 1956 Act to leases which
were executed for periods of over twenty years but containing a clause allowing
prior determination at the instance of either the lessor or the lessee. Prior
to 1965, the said Section was comprised only of one Section which is now
numbered as Sub-section (1). Sub-section (2) was added by Amending Act XXIX of
1965. Since we shall be considering the provisions of Section 3 in this appeal,
at some length, the same as it stands, after amendment, is reproduced hereinbelow
for reference:-
-
"Certain
provisions of the Act not to apply to certain leases.
-
The provisions
relating to rent and the provisions of sections 31 and 36 shall apply to any
premises held under a lease for residential purpose of the lessee himself and
registered under the Indian Registration Act, 1908, where—
-
such lease has
been entered into on or after the 1st December 1948, and
-
such lease is
for a period not more than 20 years, and save as aforesaid nothing in this Act
shall apply to any premises held under a lease for a period of not less than 15
years.
-
Notwithstanding
anything to the contrary in sub-section (1) but subject to sub-section (3) of
section 1, this Act shall apply to all premises held under a lease which has
been entered into after the commencement of the West Bengal Premises Tenancy
(Amendment) Ordinance, 1965:
Provided
that if any such lease is for a period of not less than 20 years and the period
limited by such lease is not expressed to be terminable before its expiration
at the option either of the landlord or of the tenant, nothing in this Act,
other than the provisions relating to rent and the provisions of sections 31
and 36, shall apply to any premises held under such lease." As will appear
from the facts involved in this appeal, by a registered deed of lease dated
13th January, 1969, the predecessor-in-interest of the appellants let out the
ground floor flat with one garage, measuring 1200 sq.ft., in premises No.29/1, Bondel
Road, Calcutta 700019, to the respondent on a rental of Rs.450/-per month. The
lease commenced with effect from 1st January, 1969, and was for a period of 21 years. The lease deed contained
a clause which permitted the parties to terminate the lease prior to its expiry
with notice from either side.
On 29th September, 1972, when the lease was subsisting, the
lessor served a notice determining the lease under Section 111 (g) of the
Transfer of Property Act, 1882. The lessee was asked to quit and vacate and
deliver possession to the lessor on the expiry of the notice period. Inasmuch
as, the lessee did not vacate the premises, the lessor filed a suit, being
Title Suit No.3/1973, for eviction of the lessee from the suit premises and for
recovery of arrear rents and damages. The said suit was decreed by the 2nd
Subordinate Judge at Alipore under Section 111 of the Transfer of Property Act,
1882, on the ground of default. However the lessee made an application for
protection under Section 114 of the Transfer of Property Act, 1882, and on
payment of the arrear rents, he was entitled to retain his possession of the
suit premises.
Subsequently,
on completion of the period of 21 years reserved in the lease deed, in 1990,
the lessor, who is represented by the appellants herein, called upon the lessee
(the respondent herein) to hand over peaceful and vacant possession of the suit
premises. On the failure of the respondent to do so, the lessor filed another
suit, being Title Suit No.71/1990, in the court of the Second Munsif, Alipore,
for ejectment. In his written statement the respondent took a stand that the
suit was not maintainable since the respondent was a tenant protected under the
provisions of the 1956 Act. The Trial Court by its judgment and decree dated 29th June, 1996, negated the defence taken by the
respondent herein that she had been inducted as a monthly tenant and decreed
the suit upon holding that the respondent had failed to establish her claim of
monthly tenancy.
Apart
from the above, the trial court also took note of the fact that the earlier
suit had been filed under the provisions of the Transfer of Property Act, 1882,
and at no point of time had the respondent taken the plea that her tenancy was
governed by the provisions of the 1956 Act. The trial court took note of the
fact that, on the other hand, the respondent had herself obtained relief
against eviction under Section 114 of the Transfer of Property Act, 1882.
On the
said two grounds, the trial court decreed the suit for eviction against the
respondent herein.
The
respondent preferred an appeal against the said judgment and decree of the
trial court, being Title Appeal No. 246/1996. The first appellate court also
rejected the respondent's claim of having been inducted as a monthly tenant and
affirmed the judgment of the trial court by holding that the decision in Title
Suit No.3/1973 attracted the provisions of Section 11 of the Civil Procedure
Code, 1908, relating to the applicability of the Transfer of Property Act to
the leasehold premises and held further that the said question could not be
reopened. It was also held by the 1st appellate court that the tenancy created
by the deed of lease dated 13th January, 1969 would not be governed by the 1956 Act in view of the provisions of
Section 3 (2) thereof. In arriving at such conclusion, the 1st appellate court
referred to and relied upon the decision of this Court in Savita Dey vs. Nageswar
Majumdar and Anr., reported in AIR 1996 SC 272.
Aggrieved
by the said order, the respondent preferred a second appeal before the Calcutta
High Court which was numbered as Second Appeal No. 595/1997. By judgment and
order dated 10th
September, 1999, the
High Court allowed the second appeal upon reversing the finding of the courts
below regarding the applicability of the 1956 Act to the deed of lease executed
by the lessor on 13th
January, 1969. The High
Court also disagreed with the finding that the decision in the earlier suit
(T.S. No.3/1973) operated as res judicata as far as the plea of protection
under the 1956 Act is concerned.
This
appeal has been preferred against the said judgment of reversal of the Calcutta
High Court.
Appearing
in support of the appeal, Mr. P.S. Mishra, Senior Advocate, reiterated the
stand of the appellant before the courts below and submitted that the
defendant-respondent was precluded by the principle of res judicata from
contending that her tenancy was protected under the provisions of the 1956 Act.
He urged that since the respondent had obtained the benefit of Section 114 of
the Transfer of Property Act in the earlier suit, she was estopped from raising
a defence in the later suit that her tenancy was protected under the proviso to
Sub-section (2) of Section 3 of the 1956 Act.
It was
also contended that apart from the question of res judicata, the High Court had
erroneously reversed the findings of the courts below regarding the
applicability of the 1956 Act to the tenancy created by the lessee having
regard to the clause which entitled both the lessor and the lessee to terminate
the lease during its subsistence. It was submitted that since the lease was for
a fixed period of twenty one years and was allowed to run for the full length
of its term and the respondent remained in possession of the demised premises
throughout the period of lease, the High Court had erred in holding that such
clause brought the lease within the protection of the 1956 Act.
Mr. Mishra
submitted that the decision of this Court in Savita Dey vs. Nageswar Majumdar
and Anr.(supra), fully supported the case of the appellant and the High Court
had erroneously reversed the judgments of the courts below.
The
application of the principles of res judicata and estoppel was denied by Mr. Rana
Mukherjee, learned advocate, appearing for the respondent. According to him,
the respondent was not precluded from claiming that the lease granted in her favour
was protected under Section 3 (2) of the 1956 Act, merely because the
provisions of Section 114 of the Transfer of Property Act had been invoked in
the earlier suit.
It was
contended that the object of Section 114 of the Transfer of Property Act, 1882,
was similar to the object of Section 17 (4) of the 1956 Act and it was
immaterial which of the two provisions was invoked in a given case and, in any
event, the question was a pure question of law to which the rule of res judicata
would not apply as was held by this Court in Mathura Prasad Bajoo Jaiswal and
Ors. vs. Dossibai N.B. Jeejeebhoy, (1970) 1 SCC 613.
Mr. Mukherjee
submitted that the language of Section 3(2) of the 1956 Act made it clear that
on account of the prior determination clause the lessee enjoyed the protection
of the 1956 Act. It was urged that the lease had, in fact, been determined
during its subsistence by a notice issued by the appellants on 29th September, 1972, followed by a suit for eviction on
the basis thereof. The exercise of the option of prior determination brought
the lease within the ambit and protection of the 1956 Act. It was not,
therefore, a case of uninterrupted continuance of the lease for a fixed period
of 21 years on account of the break that had been effected by the determination
of the lease within three years from the date of its execution. There was,
therefore, no error in the High Court's finding that on account of the clause
relating to prior determination, the lease would be governed by the provisions
of the 1956 Act notwithstanding the fact that the earlier suit had been filed
and conducted under the provisions of the Transfer of Property Act.
On a
construction of the provisions of Sub-section (2) of Section 3 of the 1956 Act,
we are unable to subscribe to the view expressed by the High Court. The
intention of the Legislature in amending Section 3 appears to have been to
prevent landlords from using long term leases as a camouflage for excluding
them from the protection of the 1956 Act and yet retaining the right of prior
determination. Sub-section (2) appears to have been enacted to prevent such
abuse, inasmuch as, once the lease was determined before the fixed period, it
attracted the proviso thereof.
This
aspect of the matter was noticed by a Division Bench of the Calcutta High Court
in Mahindra & Mahindra Ltd. vs. Kohinoor Debi, 93 C.W.N. Page 773, while
considering the applicability of Sub-section (2) of Section 3 of the 1956 Act
to a lease governed by Sub-section (1) thereof and it was observed therein as
follows :- "A lease for, say, 21 years would not cease to be, but would
remain, such a lease in the eye of law even if the lessee has been given an
option to terminate it earlier. If a lease for a fixed term with the right or
option for removal in favour of the lessee remains a lease for that fixed term
only, until the option is exercised, a lease for a fixed term with the right or
option in favour of the lessee of earlier termination should also remain a
lease for a period fixed, as the option in each case creates, enlarges, limits
or extinguishes no right, title or interest, until exercised." Although,
ultimately the matter was decided on other considerations, the aforesaid
exposition appears to us to be a correct appreciation of the law.
A
somewhat similar question came up for consideration before this Court in Savita
Dey vs. Nageswar Majumdar and Anr. (supra) which had been cited before the High
Court.
While
considering the said decision the High Court merely observed that in the said
case what had been decided was that the lease for a fixed period of twenty one
years was not governed by Section 3(2) of the 1956 Act having been entered into
prior to the enforcement of the amendment made to the provision. The High Court
did not take into consideration the decision relating to the precariousness of
a tenure which was terminable prior to its full duration and the observation
that such suggested precariousness of the tenure did not arise in the facts of
the case because the lessee/tenant had fully enjoyed the period of lease of
twenty years, which is also the case in the instant appeal. Although, in the
instant case, the tenancy was terminated by notice during the fixed period of
lease, the lessee continued to occupy the demised premises without interruption
for the full period of twenty one years.
The
decision in Savita Dey's case makes the position clear that the mere inclusion
of a clause for prior determination of a lease, which is otherwise for a fixed
period of more than twenty years, will not ipso facto bring it within the
exception contemplated in the proviso to Sub-section (2) of Section 3 of the
1956 Act. The inclusion of such a clause may be taken by the tenant as a defence
in the event the option under the said clause is exercised. Such a defence was
not set up by the lessee in the earlier suit when it was available to her and
the same is not available to her after the lapse of the fixed period of the
lease.
As was
indicated by the Calcutta High Court in the Mahindra and Mahindra case (supra)
a lease for a fixed period does not cease to be so by the inclusion of a clause
entitling either the lessor or the lessee to determine the lease prior to its
expiry, unless such option is actually exercised.
In the
impugned judgment under appeal, the High Court went wrong in holding that it
had been found that the lease in question was governed by Section 3(2) of the
1956 Act. To the contrary, both the trial Court and the 1st Appellate Court
held that the deed of lease was not governed by the provisions of the 1956 Act under
Section 3(2) and such finding was reversed by the High Court on a
misapplication of the decision in Savita Dey's case.
The
law is clear that lease deeds for periods of twenty years or more would stand
excluded from the operation of the 1956 Act except in matters relating to
Sections 31 and 36 thereof, unless the same were terminable before their
expiration at the option either of the landlord or of the tenant.
In
other words, if such a lease is terminated before its fixed period expired, the
proviso to Section 3(2) would be attracted as a defence against eviction. If,
however, the lease was allowed to run its full course, both the lease and the
conditions contained therein would come to an end and would cease to be
operative and the clause for prior determination would no longer be available
as a defence against eviction.
The
appeal must also be allowed on the question of estoppel. Having submitted to
the jurisdiction of the Court under the Transfer of Property Act and having
obtained relief thereunder, the respondent cannot in the present suit claim
protection under the provisions of the West Bengal Premises Tenancy Act, 1956
to which she is not, in any event, entitled, in terms of the lease deed dated
13th January, 1969.
The
appeal is accordingly allowed. The judgment and decree of the High Court is set
aside and that of the trial Court is restored. The respondent is granted time
till 31st December, 2006, to vacate the premises and make over peaceful
possession thereof to the appellants subject to filing of the usual affidavit
within fifteen days.
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