HIGH COURT OF CALCUTTA
A.N. RAY, D.P. KUNDU, JJ.
J Thomas And Co Pvt. Ltd. - Appellant
Versus
Pawan Kumar Tibriwalla - Respondent
APO No. 294 of 1994
Decided on : Sep 07, 1998
LEASE RENEWAL - HOLDING OVER - INTERPRETATION OF SECTION 116 OF THE TRANSFER OF PROPERTY ACT - SUMMARY DECREE FOR EVICTION - VALIDITY.
Fact of the Case:
The tenant occupied a flat under a registered lease for 21 years with an option to renew for a further period of five years. After the expiry of the initial period, the tenant continued to pay rent at the same rate for five years, which was accepted by the landlord. The landlord filed a suit for eviction, claiming that the tenant was holding over after the expiry of the lease term.
Finding of the Court:
The court held that the tenant had exercised its option to renew the lease by tendering the rent fixed by the registered lease. The court further held that there was no evidence to suggest that the tenant had evinced an intention not to abide by the terms of the original lease. Therefore, the court held that the tenant was not holding over under section 116 of the Transfer of Property Act and dismissed the landlord's suit for eviction.
Issues: 1. Whether the tenant had exercised its option to renew the lease? 2. Whether the tenant was holding over under section 116 of the Transfer of Property Act?
Ratio Decidendi: 1. An option to renew a lease may be exercised by the lessee in any lawful manner prescribed by the parties in their agreement contained in the lease. In the absence of any prescribed mode of exercise of such option, it may be exercised in any lawful manner at all. 2. A case of holding over under section 116 of the Transfer of Property Act can arise if and only if the original lease has come to an end. It cannot be that the original lease and the fresh periodic lease by way of holding over subsist together.
Final Decision: The court dismissed the landlord's appeal and upheld the summary decree for eviction.
1. THIS is an appeal from a summary decree for eviction passed on 9. 394 by the Hon'ble Justice Ruma Pal, under chapter XIIIA of our Original Side Rules.
2. THE tenant came into possession under a registered Indenture of lease dated 1965 where under the term was limited for 21 years with an option to renew for a further period of five years being given to the lessee.
The initial period expired with the expiry of 31.10.86. Rent @ Rs. 950/- only per month was thereafter also paid and accepted for five years.
3. THE premises in suit is a flat with servant quarters and garage, the carpet area of the flat being 1800 square foot in one Of the best localities in Calcutta, The rent is perhaps a little on the very low side.
4. BE that as it may. in support of the appeal resisting the summary decree two points were urged by Dr. Banerjee, the arguments being thereafter taken up by Mr. Deb.
These were the points of fraudulent pecuniary valuation of the suit seeking to invoke the pecuniary jurisdiction of this court wrongfully, and a point of holding over under Section 116 of the Transfer of property Act
5. DR. Banerjee's submission was that on both these grounds his clients were entitled to have leave to defend. So for as the ground of fraudulent inflation of the pecuniary claim of the plaintiff is concerned, we are of the clear opinion that the summary decree passed in the court below cannot be upset on this ground. It is true that if the court is of opinion that the claim of the plaintiff as made in the plaint is absurd and has been made absurdly high to deprive the proper lower court of its jurisdiction, then and in that event the suit can be dismissed on that ground. But for success of a plea of this nature the plaintiffs case has to be very bad, as indeed all fraudulent cases must be. In the Instant case the flat under occupation has a carpet area of 1800 sft. The area is one of the best in our metropolis. The monthly rent of Rs. 950/- is an old rate and is commercially unobtainable today. Mesne profits are claimed in the suit at the rate of Rs. 60. 000/- per month. It might be high, it might be excessive but it is nowhere near fraudulent. The matter is so clear that allowing the whole suit to go to trial on an issue of this nature would be improper and unjust. The defence in this regard, therefore, was correctly ruled out summarily in the court below and we abide by the first court's reasoning in this regard.
6. IN regard to inflation of jurisdiction Dr. Banerjee relied on the case of Nandita Base, reported at AIR 1987 SC 1947. Following the dicta in that case we have absolutely no hesitation in opining that claim of Rs, 60. 000/- per month made toy the plaintiff here was in no manner a fanciful claim. It might not succeed at trial (because the money part of the claim is not the subject matter of the summary decree, it being limited only to eviction) but defeating the entire suit on the ground of the claim for mesne profits being of a fraudulent nature would be impossible order to make. Thus, the summary decree for eviction cannot be resisted on this ground.
We next come to the point of holding over. Dr. Banerjee's simple submission was that after the period of 21 veal's was over after 31.10.86. his clients did nothing which could be treated as an exercise of the option to renew for the further period of 5 years. There was no letter. There was no oral conversation, nothing at all. Thus, Dr. Banerjee argued, the payment of monthly rent thereafter raised a fresh monthly tenancy as between the landlord and the tenant. This raising of monthly tenancy is in the same nature as is raised by the landlord and tenant agreeing to create a monthly tenancy simply by payment and acceptance of monthly rent, month by month. Dr. Banerjee gave us the case of Delhi Development authority, reported at (1973) 2 SCC S25, alternatively at AIR 1973 SC 2609. He said on the basis of the observations here that a lease upon renewal is a fresh lease. He s
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