Important point
Where the dominant intention of the parties was to create a lease for running the business of an iron casting foundry, it cannot be said that the settlement was in respect of the premises constituting ‘premises tenancy’ within the meaning of the West Bengal Premises Tenancy Act.

Headnote:Transfer of Property Act, 1882—Section 106—West Bengal Premises Tenancy Act, 1956—Section 13(6)—Evidence Act, 1872—Section 116—‘Lease of business’ and ‘lease of building’—Distinction—Suit for eviction under West Bengal Act—Maintainability—One ‘H’ obtained settlement/lease hold interest for suit premises, raised constructions and set up an iron casting foundry—After his death, his legal heirs, respondents 1 and 2 settled the whole karbar (business) of iron casting foundry along with land and all fittings and fixtures in favour of one ‘KM’ for a period of five years at a monthly rent—By successive transfers, interest of original lessees/settles came to be acquired by appellant—Settlement in favour of appellant came to an end in 1959—Plaintiff respondents filed suit for recovery of possession and for mesne profits—Subordinate Court decreed the suit with respect to both ‘B’ and ‘C’ Schedule properties—It was held that ‘C’ Schedule property was not let out to appellant and was trespassed by appellant—It was held that there was no necessity to determine the tenancy by issuing a notice under Section 106 of TP Act—High Court in appeal held that tenancy of ‘B’ Schedule property could not be determined without issuing notice under Section 106 of the Act—Whether High Court was justified in holding that what was let out to appellant was the business of running an iron casting foundry and not ‘premises’ within the meaning of West Bengal Act—(Yes).
Held : Reading the terms of the settlement as aforesaid and construing the same we are of the view that the dominant intention of the settlers was to effect the settlement in respect of the karbar (business) of iron casting foundry set up by them along with machinery housed in a building. ‘Premises’ in the Act are defined to mean a building or a part of a building which includes gardens, grounds and out-houses, if any, appertaining to the building. It also include the furniture supplied or any fittings or fixtures in a building or a part of the building but would not include a room in a hotel or a lodging house. It does not include the lease of a business along with machinery in a building. The intention of the parties was not to settle or grant lease of the structures and sheds as such. Structures and sheds did not constitute the dominant part of the settlement in favour of the appellant. It is evident from the terms of the settlement that the dominant intention of the parties was to create a lease for running the business of an iron casting foundry. It cannot be said that the settlement was in respect of the premises constituting ‘premises tenancy’ within the meaning of the Act. Tenancy was not being created of a premises to run a business it was to the contrary. (Para 19)

Judgment

Bhan, J.—This appeal by grant of special leave has been filed by defendant No. 1, the appellant herein, against the judgment and decree passed by the High Court of Calcutta. By the impugned judgment the High Court has restored the decree for recovery of possession and mesne profits with regard to Plaint ‘B’ Schedule property in favour of the plaintiffs/original respondent Nos. 1 & 2 (since deceased and now represented by their legal representatives), setting aside the judgment of the Appellate Court in Title Appeal No. 52/1976 and restoring that of the Trial Court.

2. Facts necessary for the disposal of this appeal are as under :

One Hangeswar alias Narendra Nath Singha on 4th February, 1936 obtained settlement/lease-hold interest for ‘A’ Schedule property, i.e. premises No. 77, Benaras Road, Howrah admeasuring 3 Bighas including a tank from Sear Sole Raj Estate. He raised certain constructions including sheds on ‘B’ Schedule property, a part of ‘A’ Schedule property and set up an iron casting foundry under the name and style of D.L. Singha and Company, which was run by him till his death. After his death on 31st May, 1954, his legal heirs, original respondent Nos. 1 and 2 settled the whole karbar (business) of iron casting foundry along with land and all fittings and fixtures in favour of one Kalipada Mondal and Bahar Bala Dassi on 27th July, 1954, for a period of five years starting with the month of Baisakha 1361 B.S. Bangabda Samvat (for short “B.S.”) (Bangla year) to Chaitra 1365 B.S. at a monthly rent of Rs. 466/3 annas. By successive transfers, interest of original lessees/settlees came to be acquired by the appellant on 18th January, 1956 (A.D.). Settlement in favour of the appellant came to an end by efflux of time in Chaitra 1365 B.S., equivalent to, 13th April, 1959. Appellant failed to vacate the ‘B’ Schedule property as well as to pay the rent after 1363 B.S.

3. Original plaintiff Nos. 1 and 2 instituted suit No. 11/1959 against the appellant but the same was withdrawn due to some formal defects with liberty to file a fresh suit. After the withdrawal of said suit, appellant trespassed over ‘C’ Schedule property, i.e. remaining ‘A’ Schedule property consisting of a tank and its three banks. Appellant filled up the tank, raised certain structures thereon and extended its work over the said property.

4. Plaintiff respondent Nos. 1 and 2, feeling aggrieved by the conduct of the appellant, instituted the present suit No. 65/1965 for recovery of possession of ‘B’ and ‘C’ Schedule properties and for mesne profits. Appellant in the written statement, inter alia denied the title of the plaintiffs to the suit property as well as existence of relationship of landlord and tenant between them. The allegation that the appellant had trespassed over ‘C’ Schedule property was denied.

5. Subordinate Court decreed the suit with respect to both ‘B’ and ‘C’ Schedule properties. It was held that ‘C’ Schedule property was not let out to the appellant and the appellant had taken possession of the same by committing trespass. That relationship of landlord and tenant existed between the parties with regard to ‘B’ Schedule property. It was held that the predecessors-in-interest of the appellant became tenant of the premises by virtue of settlement of karkhana (factory) together with the land underneath in their favour. Appellant having stepped into their shoes is estopped under Section 116 of the Indian Evidence Act from disputing the title of the plaintiffs. The settlement came to an end by efflux of time on 13th April, 1959. There was no necessity to determine the tenancy by issuing a notice under Section 106 of the Transfer of Property Act. Service of notice under Section 13(6) of the West Bengal Premises Tenancy Act, 1956 (for short “the Act”) was sufficient to put an end to the relationship of landlord and tenant between the parties. It was also held that the appellant had committed default in payment of rent of ‘B’ Schedule

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Judicial Analysis

SupremeToday

2005 Supreme(SC) 603

Important pointWhere the dominant intention of the parties was to create a lease for running the business of an iron casting foundry, it cannot be said that the settlement was in respect of the premises constituting ‘premises tenancy’ within the meaning of the West Bengal Premises Tenancy Act.

Cases Referred (3)

Judicial Analysis

Important point
Where the dominant intention of the parties was to create a lease for running the business of an iron casting foundry, it cannot be said that the settlement was in respect of the premises constituting ‘premises tenancy’ within the meaning of the West Bengal Premises Tenancy Act.