PATNA HIGH COURT
V.Ramaswami and N.L.Untwalia JJ.
Ganesh Sonar
Versus
Purnendu Narayan Singha
Letter Patent Appeal No. 128 of 1958 ;
Decided On : NOVEMBER 21, 1961
LANDLORD AND TENANT - LEASE - OPTION TO LESSOR TO RESUME LEASEHOLD LAND - WHETHER COVENANT CREATING INTEREST IN LAND - RULE AGAINST PERPETUITIES - TRANSFER OF PROPERTY ACT, SECS. 54, 106, 111(E).
Fact of the Case:
Plaintiffs filed a suit for possession of land leased to the defendant, claiming that they required the land for the purpose of holding a hat (market). The lease agreement contained a clause giving the lessor the option to determine the lease and take possession of the land if it was required for the purpose of a hat. The defendant resisted the suit, contending that the plaintiffs did not genuinely require the land for a hat and that the notice served by the plaintiffs to terminate the lease was invalid.
Finding of the Court:
The trial court and the lower appellate court concurrently found that the plaintiffs genuinely required the land for the purpose of holding a hat and that the lease was terminable on the exercise of the option by the plaintiffs to hold a hat. The High Court affirmed the decree of the lower courts and dismissed the defendant's appeal.
Issues: 1. Whether the option given to the lessor to determine the lease and take possession of the land was a covenant creating an interest in land and offended the rule against perpetuities. 2. Whether the option given by the lessee was merely to the lessor for his lifetime or also to his heirs. 3. Whether it was necessary for the plaintiffs to give notice to the defendant under Sec.106 of the Transfer of Property Act to determine the lease.
Ratio Decidendi: 1. The option given to the lessor to determine the lease and take possession of the land was not a covenant creating an interest in land, but merely a personal covenant, and therefore the rule against perpetuities did not apply. 2. The option given by the lessee was not merely to the lessor for his lifetime, but also to his heirs, as the kabuliyat should be construed in the language and context of the other clauses of the document. 3. It was not necessary for the plaintiffs to give notice to the defendant under Sec.106 of the Transfer of Property Act, as the case fell under Sec.111(e) of the Act, which provides for the determination of a lease by express surrender.
Final Decision: The Letters Patent Appeal was dismissed.
1. In the suit out of which this appeal arises the plaintiffs alleged that on the 81st July, 1921, there was a registered lease granted by the father of plaintiff No. 1 in favour of the defendant for the purpose of homestead. Both the patta and the kabuliyat were registered and one of the terms and conditions of the lease was that the lessor would re-enter on the land it it was required for the purpose of hat and the lessee would vacate the same, and in that case the lessee would he entitled to money value of any construction that might be existing thereon. The relevant clause of the kabuliyat is to the following effect: -
"10. That I have taken settlement of the said land for the purpose of dwelling therein and should I fail to construct a dwelling house on the said land within one year and from the date of settlement, you shall, without the help of the Court bring the said land under your khas possession or make another settlement thereof. No claim for the refund of the amount of salami or any other kind of plea or objection raised by me or by my heirs shall be valid. As the said land is near the katras hat and should you require the said land in future for the said that, I and my heirs shall, without any objection, relinquish the said leasehold land, but I shall get the price of the house constructed thereon-"
Paragraph 11 of the kabuliyat also states as follows:
"11. That I together with my sons, grandsons etc. in succession, shall enjoy and possess, in great happiness, the said land, by only living in the said land according to the terms of this deed and by paying the said rent Should I violate any one of the terms of this deed, you shall, without the help of the Court, bring the said land under your khas possession and make another settlement thereof nO objection raised by me and my heirs thereto shall be valid".
The plaintiff claimed that the land in question was required by him for the purposes of hat. On the 31st March, 1948, the plaintiff No.1 served a notice on the defendant expressing his intention to determine the tenancy and asked the defendant to vacate the land within seven days. The suit was resisted by the defendant on the ground that the plaintiffs did not require the land for the purpose of creating a hat and that the notice served by plaintiff No. 1 on the defendant was invalid and did not determine the lease. The trial court as also the lower appellate court concurrently found that the plaintiffs genuinely required the disputed land for the purpose of holding a hat and that the lease was terminable on the exercise of the option by the plaintiffs to hold a hat, and, therefore, the defendant was not entitled in law to resist the suit for possession. The lower courts accordingly granted a decree to the plaintiffs for khas possession, subject to the payment by the plaintiffs to the defendant of a sum of Rs. 724/- and odd as compensation for the structures erected by the defendant on the land. The defendant appealed to the High Court and on the 3rd December, 1958, the learned Single Judge of the High Court affirmed the decree of the lower courts and dismissed the appeal. This appeal has been presented by the defendant under Clause 10 of the Letters Patent against the judgment of the learned Single Judge.
2. It was submitted by learned Counsel for the appellant in the first place that Clause 10 of the kabuliyat by which an option was given to the lessor to determine the lease and take possession of the leasehold land was a covenant between the parties creating interest in land and offended the rule against perpetuities and must, therefore, be treated as null and void. In support of this proposition learned Counsel referred to Woodall V/s. Cliftan, (1905) 2 Ch 257, where it was held by the Court of Appeal that a proviso in a lease giving an option to the lessor to purchase the fee simple of the land at a certain rate was held to be invalid on the ground of remoteness. In our opinion the principle laid do
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