SupremeToday Landscape Ad
Back
Next
Judicial Analysis Court Copy Headnote Facts Arguments Court observation
Listen Audio Icon Pause Audio Icon
judgment-img

1984 Supreme(Kar) 345

Karnataka High Court
Sundara Bai Ammal - Appellant
Versus
K.V.Rajagopal - Respondent
Decided On : 12-21-84
R.F.A. : 402 of 1983

Advocates:
P.RAMACHANDRA RAO, V.KRISHNA MURTHY

Headnote:

LEASE - SUIT AGREEMENT - CONSTRUCTION - WHETHER LEASE OR LICENCE - DISTINCTION - PRINCIPLES - INTENTION OF PARTIES - SURROUNDING CIRCUMSTANCES - ORAL EVIDENCE - VALIDITY OF TERMINATION - ACCESSORY LICENCE.

Fact of the Case:

Plaintiff leased out premises to defendant for running a factory. Defendant executed a hire agreement for one year with an option to renew for a further period of three years. After the expiry of the first year, plaintiff demanded an enhancement of rent. Defendant refused and plaintiff issued a registered notice demanding vacation of the premises. Defendant filed a suit for a perpetual injunction restraining plaintiff from interfering with his possession. Plaintiff filed a suit for mandatory injunction directing defendant to hand over the business.

Finding of the Court:

1. The suit agreement is a lease and not a licence. 2. The lease was not validly terminated.

Issues: 1. Whether the suit agreement is a lease or licence? 2. Whether the suit agreement was validly terminated?

Ratio Decidendi: 1. To ascertain whether a document creates a lease or licence, the substance of the document must be preferred to the form; the real test is the intention of the parties whether they intended to create a lease or a licence; if the document creates an interest in the property, it is a lease; but, if it only permits another to make use of the property, of which the legal possession continues with the owner, it is a licence; and if under the document a party gets exclusive possession of the property, 'prima facie', he is considered to be a tenant; but circumstances may be established which negative the intention to create a lease. 2. A lease can only be terminated according to law.

Final Decision: Both appeals dismissed.

N. R. KUDOOR, J.

( 1 ) THESE two Regular First Appeals arise out of the common judgment and decrees dated 23-4-1983 passed in O. S. No. 10521/1980 and O. S. No. 10002/1981 by the Additional City Civil Judge, Civil Station, bangalore. R. F. A. No. 402/1983 is directed against the decree passed in O. S. No. 10521/1980 preferred by the defendants and r. F. A. No. 403/1983 is against the decree in O. S. No. 10002/1981 preferred by the plaintiff.

( 2 ) IN O. S. No. 10521/1980, K. V. Rajagopal is the plaintiff and Smt. Sundarabai Ammal and her son Ramachandran and grand son Kantharaj are the defendants; whereas in O. S. No. 10002/1981 smt. Sundarabai is the plaintiff and K. V. Rajagopal is the defendant.

( 3 ) I shall refer to the facts of the case as set out in the earlier suit O. S. No. 10521/1980 for the dake of convenience as it would serve the purpose of the other suit O. S. No. 10002/1981 also since the plaint averments in the former suit is the defence in the latter and the defence taken by the defendants in the former suit is the plaint 'averments in the latter.

( 4 ) THE facts of the case as set out by the plaintiff in O. S. No. 10521/1980 briefly stated, are as under: the premises in No. 4/1, Byala anjaneyaswamy Temple Compound, Old madras Road, described in the schedule consisting of an office, workshop, rooms and open compound with machines installed therein had been leased out to the plaintiff by the 1st defendant. Originally it was agreed that the lease would be for a period of three years commencing from 1-4-1979 on a monthly rent of Rs. 790/- but the lease deed was executed for a period of one year only to save stamp and registration charges. But the understanding between the plaintiff and the 1st defendant was that the said lease would be in force for a period of three years with an option to the plaintiff to renew the same on the same terms for a further period of three years. After the expiry of the first year of the lease, the 1st defendant wanted an enhancement of the rate of rent. The plaintiff represented to the 1st defendant that he has invested large funds, time and energy to improve the workshop out had sustained loss during the first year and that unless the lease terms would be for a longer period, he would not be able to recoup the loss or pay any enhanced rent. Finally, it was agreed between the plaintiff and the 1st defendant that the lease would be for a period of 10 years commencing from 1-4-1980 on a monthly rent of Rs. 900/ -. Accordingly, the plaintiff continued in occupation of the leased premises and has been paying the rent regularly. Besides, the plaintiff also paid Rs. 5,000/- by way of security deposit which is lying with the 1st defendant. The security amount was agreed to be returned to the plaintiff after the expiry of the lease period. Of late, due to the misunderstandings that have arise between the plaintiff and the 2nd defendant, the latter and some others have wrongly advised the 1st defendant to make a demand for further enhancement of the rent from Rs. 900/- to rs. 1000/ -. The plaintiff expressed his inability to agree for any further enhancement of rent. The 1st defendant being enraged at the flat refusal by the plaintiff to pay any further enhanced rent, got a registered notice dated 17-11-1980 issued to the plaintiff demanding to vacate the schedule premises by 31-12-1980. The plaintiff caused a reply notice dated 3-12-1980 to be issued setting out the true facts. The 2nd and 3rd defendants have absolutely no interest in the schedule property. The 1st defendant however has been teathering her cows in a portion of the leased property with the consent of the plaintiff. Defendants 2 and 3 seldom visited the suit schedule property. It is only the servants of the 1st defendant who were attending to the cows, have been visiting the suit schedule premises. There is a compound wall all around the schedule property with gates which are always locked by the plaintiff and his assistants. F





































Click Here to Read the rest of this document

1
2
3
4
5
6
7
8
9
10
11
SupremeToday Portrait Ad
supreme today icon
logo-black

An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers

Please visit our Training & Support
Center or Contact Us for assistance

qr

Scan Me!

India’s Legal research and Law Firm App, Download now!

For Daily Legal Updates, Join us on :

whatsapp-icon Back to top