Acceptance of rent by the landlord after the expiry of the tenancy does not create a fresh tenancy where the tenant continues in possession of the premises by virtue of the protection given by the Rent Control Acts.

Headnote:
LANDLORD AND TENANT - Rent Control - Tenancy expired - Acceptance of rent by landlord - Whether creates fresh tenancy - Transfer of Property Act (IV of 1882), S. 116.
Fact of the Case:

The appellant was a contractual tenant of the respondents' premises from June 15, 1917, till June 15, 1947, under three successive tenancies for 10 years each. After the expiry of the tenancy, the appellant continued to pay rent, which was accepted by the respondents. The appellant claimed that by acceptance of rent after determination of the tenancy, he continued to be "a tenant holding over" within the meaning of S. 116 of the Transfer of Property Act.
Finding of the Court:

The court held that the appellant did not acquire the rights of a tenant holding over merely by accepting rent from the appellant and by failing to take action against him. The court further held that the appellant's occupation of the premises after the expiry of the tenancy was not in pursuance of any contract express or implied, but was by virtue of the protection given by the successive statutes. This occupation did not confer any rights upon the appellant and was not required to be determined by a notice prescribed by S. 106 of the Transfer of Property Act.
Issues: Whether acceptance of rent by the landlord after the expiry of the tenancy creates a fresh tenancy.
Ratio Decidendi: The court held that acceptance of rent by the landlord after the expiry of the tenancy does not create a fresh tenancy where the tenant continues in possession of the premises by virtue of the protection given by the Rent Control Acts.
Final Decision: The appeal was dismissed.

Judgment

SHAH, J. : Of the premises relating to which this dispute arises - No. 5, Raja Rajkissen Street, Calcutta - the respondents are the owners and the appellant was a contractual tenant from June 15, 1917, till June 15, 1947, under three successive tenancies for 10 years each. Under the first tenancy, the appellant paid rent at the rate of Rs. 84-15-0 per month, under the second tenancy at the rate of Rs. 180 per month and under the third tenancy at the rate of Rs. 225 per month. The tenancy was in respect of buildings used for manufacturing "tin canisters" and open land. On September 30, 1946, the Governor of Bengal issued the Calcutta Rent Ordinance V of 1946, making certain provisions for control of rent of premises in the town of Calcutta. By S. 12 of the Ordinance, it was provided in so far as it is material that notwithstanding, anything contained in the Transfer of Property Act, the Presidency Small Cause Courts Act or the Indian Contract Act, no order or decree for the recovery of possession of any premises shall be made as long as the tenant pays rent to the full extent allowable by the Ordinance and performs the conditions of the tenancy. By the proviso, the landlord was, notwithstanding the protection granted entitled, if the conditions specified therein were fulfilled, to obtain possession of the premises. This Ordinance was replaced by Act I of 1947 which contained substantially the same provisions. By the West Bengal Act V of 1948, the provisions of Ordinance V of 1946 and Act I of 1948, were continued. Thereafter, on December 1, 1948, the West Bengal Premises Rent Control (Temporary Provisions) Act XXXVIII of 1948 was brought into operation and by this Act, the West Bengal Act V of 1948 was repealed, but the protection granted to the tenants was continued. This Act was repealed by the West Bengal Premises Rent Control Act, 1950, and by S. 12 of the latter Act protection to tenants including tenants whose tenancies had expired, against eviction was granted by prohibiting courts from passing decrees or orders for recovery of possession of any premises in favour of landlords. It was provided by that Act that the landlord shall be entitled to obtain a decree in ejectment inter alia where the premises are reasonably required by him either for the purpose of building or rebuilding or for his own occupation.

2. By letter dated May 15, 1947, the respondents called upon the appellant to vacate and deliver possession on the expiry of the period of tenancy. Possession was however not delivered by the appellant and he continued to pay the stipulated amount and the same was accepted by the respondents. In an application under S. 9 of the West Bengal Premises Rent Control (Temporary Provisions) Act, 1948, the Controller fixed the standard rent of the premises at Rs. 455 per month. After the enactment of the West Bengal Premises Rent Control Act, 1950, another application was submitted by the appellant and the standard rent was reduced to Rs. 247-8-0. On October 10, 1950, the respondents served a notice upon the appellant requiring him "to quit, vacate and deliver possession of the premises occupied", which the appellant was described as holding as "monthly tenant", on the expiry of the 31st of Chaitra, 1357 B. S., i.e., April 14, 1951. The ground for eviction, it was claimed, was that the premises were reasonably required by the landlords for putting up new buildings thereon. The appellant having failed to vacate the premises, the respondents sued in the Court of Small Causes, Calcutta, for a decree in ejectment. The Court of Small Causes decreed the suit filed by the respondents. In appeal to the Special Bench, Court of Small Causes, the decree passed by the court of first instance was reversed. The appellate court held that by acceptance of rent after determination of the tenancy in June, 1947, the appellant continued to be "a tenant holding over" and as the purpose of the tenancy was manufacturing, it could be determine

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