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1981 Supreme(SC) 16

SUPREME COURT OF INDIA
A.P. SEN AND E.S. VENKATARAMIAH, JJ.
Smt. Shanti Devi, Appellant
Versus
Amal Kumar Banerjee, Respondent.
Civil Appeal No. 2731 of 1980, D/- 9-1-1981.

Headnote:Validity of notice under section 106 — tenancy expired by efflux of time

       – Where the lease was a lease for a definite term and therefore, expired by efflux of time by reason of Section 111(a) of the Act. That being so, the service of a notice under Section 106 was not necessary. Undoubtedly, Section 111(a) which deals with determination of lease by efflux of time, has to be read with Section 116 of the Act. See decision in the case of Smt. Shanti Devi v. Amal Kumar Banerji, AIR 1981 SC 1550 = 1981(2) SCC 199.

Judgement Key Points

Key Points: - The lease was for a definite term of ten years (four-year initial term plus two renewals of three years each) and thus expired by efflux of time under Section 111(a) of the Act (!) . - When a lease expires by efflux of time and is not a tenancy holding over, Section 106 is not applicable and a quit notice is not required (!) . - The success of the appeal rested on recognizing the lease as a definite-term lease, not a month-to-month tenancy, and hence no Section 106 notice was necessary (!) . - The lease commenced from January 11, 1960, and ended on January 10, 1970, determining landlord-tenant relationship at that time (!) . - The High Court's consideration of notice validity proceeded under an incorrect assumption of month-to-month tenancy; the correct position is that the lease’s definite term governs (!) . - Statutory tenancy under West Bengal Premises Tenancy Act did not arise since the area was not a Municipality and the premises were not statutory tenants after contractual termination (!) . - The appellate court restored the lower courts’ decrees for ejectment, concluding the plaintiff was entitled to ejectment after the lease expired (!) . - The judgment allowed a temporary stay to vacate with conditions, including deposit of arrears and ongoing damages, pending execution until a specified date (!) . - Appeal outcome: appeal allowed; High Court’s judgment set aside; plaintiffs’ suit decreed (!) . - Citation reference: AIR 1981 SC 1550 (!) .

What is the effect of a lease for a definite term on the necessity of a notice under Section 106 of the Transfer of Property Act?

What is the proper interpretation of the lease term and its interaction with Section 111(a) and Section 116 of the Transfer of Property Act?

What are the rights and obligations of the parties regarding ejectment where the lease has expired by efflux of time and whether a quit notice under Section 106 is required?


JUDGMENT:- The only point involved in this appeal from a judgment of the Calcutta High Court, in reversal of the judgment and decree of the Addl. District Judge, affirming those of the Subordinate Judge, Birbhum, and dismissing the plaintiffs suit for ejectment, is whether the plaintiffs suit for ejectment was not maintainable without a notice under S. 106 of the Transfer of Property Act, 1882.

2. The material facts of this case are its follows- By an indenture of lease dated March 19, 1956, the appellant who was the plaintiff, demised a cinema theatre known as Shanti House, situate at Sainthia under Anchal Panchayat in district Birbhum, to the respondent-defendant for a term of four years with a covenant of two renewals of three years each. The lease of this cinema theatre was to commence from the date on which the defendant was able to procure a licence. On May 2, 1970, the plaintiff brought a suit for ejectment on the ground that the lease had expired by efflux of time and also pleaded in the alternative that he had sent a notice dated April 3, 1970 to the defendant both at his Calcutta address and at his Sainthia address determining the tenancy with the expiry of the month of April, 1970. The defendant contested the plaintiffs claim on various grounds. The defendant pleaded, inter alia, that no notice under S. 106 of the Transfer of Property Act having been served upon him, the suit was not maintainable. The High Court and the courts below have confined their attention to the question whether any valid quit notice had been served on the defendant without entering into the controversy whether such a notice was necessary or not. Both the learned Subordinate Judge as well as the learned District Judge upheld the plaintiffs claim that the lease had been validly determined by service of a quit notice and accordingly decreed his suit. The High Court, however, reversed that decision of theirs holding that service of a notice under S. 106 of the Transfer of Property Act on the defendant had not been proved and, therefore, held that the plaintiffs suit for ejectment was not maintainable.

3. There can be no doubt that the High Court and the courts below have without applying their mind as to the question whether S. 106 of the Transfer of Property Act was applicable or not, proceeded to deal with the question as to the validity of the notice, on the assumption that the lease was a lease from month to month. They have completely overlooked the fact that the lease was for a term of four years with a covenant for renewal for two terms of three years each, i. e., a lease for a definite duration of ten years. The preamble of the lease deed recites that the lessor, in consideration of the rent reserved and the conditions contained therein, demises unto the lessee the tenement of the cinema theatre known as Shanti House "for a term of four years", with option on the part of the lessee for renewal and subject to his paying a monthly rent of Rs. 400 as reserved. Clause (g) of the first part which deals with the lessees covenants, provides that the lessee shall at the expiration of the said term or at the expiration of the renewed term, if any, peaceably and quietly deliver possession of the cinema theatre to the lessor. Clauses (v) and (vi) of lessors covenants, i.e., the second part of the deed lay down that the lessor in the first instance, at lessees request shall grant a fresh lease for a term of three years and on the expiry of such term, on a similar request, a further fresh lease for another term of three years. The lease deed further provides by clause (6) of the third part, that in the event of the lessees failure to procure a licence by April 30, 1956, the demise shall not take effect. The lease was duly effected by a registered instrument. It is not disputed that the defendant secured the licence on January 11, 1960. The period of the lease, therefore, commenced from that date.

4. The courts below have apparently been misled by the av






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