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1992 Supreme(Bom) 209
IN THE HIGH COURT OF BOMBAY
S.M. Daud, J.
Karuna Manoharlal Ohri (Mrs.) .... Plaintiff.
Versus
Vipinbhai U. Sanghani.... Defendant.
Suit No. 214 of 1975, decided on 7-4-1992.
Advocates appeared :
K.P. Khambata with S.U. Kamdar i/by R.K. Maheshwari, for plaintiff.
F.E. Devitre i/by M/s. Thakurdas Madgaonkar, for defendant.
Headnote:Section 15-A (as amended by Act 17 of 1973)-Word occupation in Contemplates exclusive occupation which is something less than occupation equivalent to possession In legal sense of that term-Licensor retaining key of snit premises-Evidence showing licensees exclusive possession-Whether defendant acquired status of protected licensee/tenant under Section 15-A Jurisdiction of High Court to try suit.
Held- Theoretical rights cannot exclusive the concept of exclusively in occupation as is contemplated by Section 15-A of the Rent Act. True, that section speaks of exclusive occupation on the part of the licensee and this exclusively may be in existence at the same time as joint ness in possession. In the instant case the joint ness in possession was evidenced by the licensor keeping one set of the flats keys with him and ensuring that any visit made by him to the flat during the currency of the licence would not render him liable for trespass or other misfeasance. When Section 15-A speaks of occupation, it contemplates exclusive occupation which is something less than occupation equivalent in possession in the legal sense of that term. Considered thus, the case of a licensee in exclusive possession such as the defendant, albeit with the right of the licensor to enter upon the premises during the currency of the licence would be within the protection of Section 15-A of the Rent Act. Therefore, having regard to the application of Section 15-A, defendant though a licensee has acquired the protection given to tenants under the Rent Act. Once this conclusion is reached, it follows that the jurisdiction to try the suit will be exclusively that of the Court specified in Section 28 of the Rent Act and not High Court.
EASEMENT ACT 1882
Section 52.
See Transfer of Property Act, 1882 Section 105.
Section 105-Easement Act 1882-Section 52-Leave and licence-Distinction- Test-Intention of parties in making agreement is determinative of question whether it was lease or licence-Intention of parties to be gathered from terms of agreement construed in context of surrounding, antecedent and consequent circumstances.
The intention of the parties in making the agreement is determinative of the question whether it was a lease or licence, The test of exclusive possession though of significance, is not decisive. By mere use of the word lease or licence the correct categorisation of an instrument under law cannot be affected. While interpreting the agreement the court has also to see what transpired before and after the agreement. The best interpretation is mane from the context. The intention of the parties to an agreement has to be gathered from the terms of the agreement construed in the context of the surrounding, antecedent and consequent circumstances. The crucial test would he what the parties intended. If in fact it was intended to create an interest in the property, it would be a lease, if it did not, it would be a licence.
The tests to determine whether a transaction is a lease or licence are easy of enumeration but difficult of application to a given set of facts. Generally speaking, if the agreement between the parties shows an intention to create an interest in the property in favour of the grantee, what results is said to be a lease. A licence on the other hand does not create an interest in property. In Associated Hotels of India v. R. N. Kapoors, AIR 1959 SC 1262, certain propositions were:
"To ascertain whether a document creates a licence or lease, the substance of the document must be preferred to the form: (2) the real test is the intention of the parties. whether they intended to create a lease or a licence (3) 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 (4) 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. Deceased plaintiff Swarup Narayan Khanna was a member of "Thakur Niwas" Co-operative Housing Society Ltd. which is a society registered under the Maharashtra Co-operative Societies Act, 1960. "Thakur Niwas" is a building owned by the society and the suit flat was allotted to the plaintiff in his capacity as the holder of five shares of the Society. S.N. Khanna was a tax practitioner and used to visit Bombay in connection with the work of his clients. Defendant in 1972 was a law student and a Director of a private concern known as 'Paramount Automobiles Pvt. Ltd." On 18th September 1972, S.N. Khanna and defendant reached an agreement the terms whereof were reduced to writing, which writing is at Ex.P-1. In this document, S.N. Khanna is described as the "licensor" and defendant the "licensee" in respect of the suit flat, the duration of the licence to be from 1-10-1972 to 31-8-1973. The monthly compensation of Rs. 650/- was to be paid by the defendant to S.N. Khanna through his authorised agent L.D. Kapoor who has been examined as P.W. 3 in the suit. Ex.P-2 collectively is the correspondence exchanged between S.N. Khanna and defendant the first in point of time being S.N. Khanna's letter dated 22-2-1973 and the last being an Advocate's reply given on behalf of the defendant on 27-3-1974. S.N. Khanna filed this suit on the 1st day of February 1975.
3. S.N. Khanna hereinafter also to be referred to as the "plaintiff" contended that the suit flat was purchased by him for his own use as a practising lawyer and because he desired to settle down in Bombay. Defendant had approached him in August 1972 with the plea that he be allowed to use the suit flat as a temporary shelter. He was studying law and was newly married and would leave the Suit flat as soon as he could arrange to get a flat on ownership basis for himself. Plaintiff made it clear to the defendant that exclusive possession of the suit flat even for a temporary period could not be given to the defendant. All that the plaintiff was prepared to grant was an indulgence to the defendant to use the suit flat jointly with the plaintiff. Defendant agreed to the terms and conditions laid down in Ex. P-1 and that is how he came to share the accommodation with the plaintiff. Plaintiff could not create a licence or a tenancy and Ex. P-1 was neither. A key of the flat was retained by the plaintiff whose furniture, fixtures an fittings inclusive of a telephone continued to be in the flat. Even if the transaction amounted to a licence, it was not a possessory licence. Defendant had violated the conditions of Ex. P-1 by not paying the compensation subsequent to the month of October 1972. The non-payment by itself brought about a cancellation of the licence. The subsequent three months compensation was accepted by plaintiff without prejudice to the revocation/cancellation of the licence which had already taken place. Defendant falsely raised the plea of being a protected licensee and/or a tenant. Assuming that section 15-A of the Bombay Rent Act was applicable to the occupation of defendant, it was plaintiff's contention that the said provision was ultra vires the Constitution as it contravened the plaintiff's fundamental rights under Articles 14, 19 and 31 of the Constitution of India. The said section conferred protection upon a particular class of licensees for no reason whatsoever. This class had been picked upon to be conferred with a right arbitrarily and without there being the slightest rationale therefore. Persons similarly situated such as sub-tenants and paying guests etc. were not given the same protection. Section 15-A of the Bombay Rent Act placed an unreasonable restriction upon plaintiff's right to property. The unpaid compensation had accumulated to Rs. 16,943.58 ps
