A lease that gives the lessee the right to remain in possession so long as he pays rent creates a permanent tenancy, not a tenancy at will.

Headnote:
LEASE - TENANCY RIGHTS - CONSTRUCTION OF LEASE - PERMANENT TENANCY OR TENANCY AT WILL - LEASE FOR BUILDING PURPOSES - RIGHT TO REMAIN IN POSSESSION SO LONG AS RENT IS PAID - OPTION TO DETERMINE LEASE - TRANSFERABILITY AND HERITABILITY OF TENANCY RIGHTS.
Fact of the Case:

A lease was executed for 30 years, with an option for the lessee to continue on the premises so long as he chose or desired, provided he paid the lessor Rs. 40 as rent every year. The lessee was also given the option to determine the lease. The lessee assigned his rights under the lease to a third party. The lessors filed a suit for possession, claiming that the tenancy was a tenancy at will and that the assignment terminated the tenancy.
Finding of the Court:

The Court held that the lease created a permanent tenancy, not a tenancy at will. The Court found that the dominant intention of the lease was to allow the tenant to remain in possession so long as he paid rent. The Court also found that the option to determine the lease was merely incidental and subsidiary to the right to remain in possession so long as rent was paid.
Issues: 1. Whether the lease created a permanent tenancy or a tenancy at will. 2. Whether the assignment of the lease by the lessee terminated the tenancy.
Ratio Decidendi: 1. The Court held that the lease created a permanent tenancy, not a tenancy at will, because: - The lease gave the lessee the right to remain in possession so long as he paid rent. - The option to determine the lease was merely incidental and subsidiary to the right to remain in possession so long as rent was paid. - The lease was for building purposes, which is a factor that may indicate a permanent tenancy. 2. The Court held that the assignment of the lease by the lessee did not terminate the tenancy because the lease created a permanent tenancy, not a tenancy at will.
Final Decision: The Court dismissed the lessors' suit for possession.

JUDGMENT - Gajendragadkar, J.

1. The short question which arises in this appeal is as to the nature and the extent of the lessees rights under the lease in question.

2. This question arises in this way. The property in suit which is S. No. 66 at Bagalkot was leased out for 30 years to West Patent Press Co., Ltd., Bagalkot. This company is defendant No. 1 in the suit. Before the period of 30 years stipulated in the lease had expired, another lease was executed in supersession of the first between the same parties on April 26, 1900. This was for 30 years. On July 8, 1910, the lessee assigned his rights under the lease to Dodveerappa. Defendants Nos. 2 and 3 are successors in title of Dodveerappa. In the present suit which was filed by the lessors on June 14, 1947, they alleged that the lessee was holding under a tenancy at will and so he was not entitled to transfer his rights to a third party.

The said transfer according to the plaintiffs terminated the tenancy in question and so they claimed possession of the property. This claim was resisted by the assignee principally on the ground that the tenancy in question was not a tenancy at will, but was a permanent tenancy. Both the Courts below have upheld this plea and have dismissed the plaintiffs suit. That is how in the present appeal on behalf of the plaintiffs Mr. Datar has urged before us that the Courts below were wrong in not treating the lease in question as constituting tenancy at will.

If the tenancy is held to be a tenancy at will, the assignment would be invalid and the plain-tiffs would be entitled to a decree for ejectment. On the other hand if the document of lease creates either a permanent tenancy or a tenancy for the lifetime of the tenant then the assignment would be valid and the plaintiffs would not be entitled to claim possession.

3. The forms in which tenancy rights are created in India are not uniform and they do not conform to precedents known to conveyancing; sometimes the words used are not precise and it is not easy to understand from the said words the intention of the parties in executing the documents. Leases are often executed without legal assistance; and the aid that the parties obtain from professional scribes does not always contribute to make the terms clear or precise. The nature of the tenancy created by any document must nevertheless be determined by construing the document as a whole.

If the tenancy is for a building purpose, prima facie it may be arguable that it is intended for the life-time of the lessee or may in certain cases be even a permanent lease. Prima facie such a lease is not intended to be tenancy at will. But whether it is a tenancy for life or a permanent tenancy must ultimately depend upon the terms of the contract itself. And in construing the terms of such contracts, the Courts must look at the substance of the matter and decide what the parties really intended to do.

4. It would be convenient to refer to a decision of our Court in this connection. In --Navalram v. Javerilal, 7 Bom LB 401 (A), where the land was let out for building purposes Jenkins C. J. and Aston J. held that it was a permanent lease. The head-note to the case reads as if the Court decided that wherever any land is let out for building purposes for no fixed period, there is always a presumption of the tenancy being permanent without reference to the words of the grant itself. It seems to us, however, that the broad proposition which the head-note sets out cannot be said to have been laid down in the judgment itself. In fact, the learned Chief Justice was at pains to point out that the words used in the lease clearly indicated the intention of the lessor to confer upon the lessee the rights of a permanent tenant. The clauses in the lease were subjected to a close examination.

Even the scheme of punctuation was considered. Ultimately, on a construction of all the clauses read together, the learned Chief Justice came to the conclusion that the lessors inte

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