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2000 Supreme(AP) 177

Andhra Pradesh High Court
Judges : C.V.N.SASTRY
S.Suresh - Appellant
Versus
Syed Omer - Respondent
S.A.No.419/99
Decided On : 03-13-00
Advocates Appeared :
Mr.A.G.Seetharam, Mr.D. Prakash Reddy

Headnote:TRANSFER OF PROPERTY ACT, Sec.108 (J) - Plaintiff filed suit against defendants 1 & 2 for recovery vacant possession of suit site - Plaintiff leased out suit site to first defendant under lease deed for a period of 10 years initially with an option to renew lease for further period of 10 years - Second defendant who is partner of first defendant gave notice to plaintiff purporting to exercise option of renewal of lease for further period of 10 years - Plaintiff contends that D2 has no right to exercise option of renewal of lease as he is stranger with whom he has no privity of contract - Trial Court decreed suit holding that there is no privity of contract betwwn D2 and plaintiff - Lower appellate court agreed with the view taken by trial court.

       Sec.108 (J) of T.P Act confers unfettered right to lessee to assign or transfer his right in the absence of any restriction in the lease deed - No indication whatsoever in the lease deed, that lease was obtained by D1 for on behalf of partnership firm - Lease deed clearly shows that lease obtained by D1 in his individual capacity only - Since lease obtained by D1 in his individual capacity only but not on behalf of firm, D2 as partner of Firm has no right to exercise option of renewal of lease.

C. V. N. SASTRY, J.

( 1 ) THE first defendant and the third defendant, who was brought on record as the legal representative of the deceased-second defendant in the suit, are the appellants in this Second Appeal. First respondent-plaintiff filed the suit against defendants 1 and 2 for recovery of vacant possession of the suit site after ejecting the defendants therefrom. As the second defendant died during the pendency of the suit, her LRs were brought on record as defendants 3 and 4. The fourth defendant is arrayed as second respondent in this Second Appeal.

( 2 ) THERE is not much controversy about the facts of the case. The plaintiff, who is the owner of the suit site admeasuring 1555 sq. yds in Hayatnagar village, leased out the same to the first defendant under lease deed dated 10-12-1979 (marked as Ex. A-2) for a period of 10 years initially with an option for the lessee to renew the lease for a further period of 10 years by giving prior notice of not less than six months before the expiry of the lease period. According to the plaintiff, the first defendant sub-let the same to the second defendant, without his knowledge or consent. It is, however, the case of the defendants that the lease was obtained for and on behalf of a partnership firm, of which the defendants 1 and 2 were partners. Before the expiry of the lease period on 8-6-89, the second defendant gave Ex. A-3 notice to the plaintiff purporting to exercise the option of the renewal of lease for a further period of 10 years, to which the plaintiff sent a reply to the second defendant stating that the second defendant was a stranger with whom the plaintiff had no privity of contract, and as such, the second defendant had no right to exercise the option of renewal of the lease. After the expiry of the lease period, the plaintiff filed the suit against both the defendants, after issuing a quit notice dated 16-5-90 (Ex. A-6 ).

( 3 ) THE defendants resisted the suit contending that the plaintiff was fully aware that the lease was obtained for the purpose of running a petrol bunk in the suit site in the name and style of M/s. Sri Rama Service Station, a partnership concern, of which defendants 1 and 2 were partners, and that rents were, in fact, paid on behalf of the firm only throughout and the same were accepted without any murmur, and the second defendant, as partner of the firm, duly exercised the option for renewal of the lease for a further period of 10 years and, as such, the lease stood extended and renewed for a further period of 10 years beyond 10-12-89, and the suit is, therefore, liable to be dismissed.

( 4 ) THE trial Court decreed the suit holding that it is not established that the second defendant is a partner of the first defendant, that there is no privity of contract between the second defendant and the plaintiff and, as such, the second defendant has no right to exercise the option of renewal and that the lease is validly terminated by the plaintiff by issuing a quit notice Ex. A-6. Questioning the said judgment and decree of the trial Court, the third defendant only preferred the First Appeal before the lower appellate Court. The fist defendant, however, filed an application to transpose him as appellant No. 2 in the appeal. The lower appellate Court, agreeing with the view taken by the trial Court, dismissed the appeal as well as the said application filed by the first defendant. Hence, this Second Appeal.

( 5 ) MR. J. V. Suryanarayana, learned senior counsel appearing for the appellants in the Second Appeal, sought to assail the judgments of the two Courts below by raising the following contentions : (1) Section 108 (j) of the Transfer of Property Act, confers unfettered right on the lessee to assign or transfer his right in the absence of any restriction in the lease deed. There is no such restriction in Ex. A-2. So, even assuming that the second defendant was a sub-lessee, she was entitled to exercise the option of renewal of the lease. (2) The














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