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2012 Supreme(Cal) 934
CALCUTTA HIGH COURT
SUBHRO KAMAL MUKHERJEE and HARISH TANDON, JJ.
R.S. Iron Industries Pvt. Ltd
Vs
Calcutta Pinkjrapole Society
S.A.T No. 431 of 2010
Decided On : 17/10/2012
Mere acceptance of rent after the expiration of the lease period does not create a new tenancy under Section 116 of the Transfer of Property Act unless there is an assent from the lessor, which must be express or implied from the conduct of the parties.
Headnote:
LEASE - HOLDING OVER - ASSENT - SECTION 116 OF THE TRANSFER OF PROPERTY ACT - NOTICE ISSUED BY LANDLORD - NO EXPRESS CONSENT FOR CONTINUANCE OF POSSESSION - NO BILATERAL AGREEMENT - NO ASSENT - NO NEW TENANCY CREATED.
Fact of the Case:
The appellant was inducted into the suit premises on the basis of a registered deed of lease dated January 9, 1958, for 21 years at a monthly rent of Rs. 675/-. The lease contained a clause for renewal for 5 years on mutually agreed terms and conditions if requested by the lessee. The lessee did not exercise the option for renewal and the lease expired on December 31, 1978. The appellant paid rent for January to September 1979. The respondent filed a suit for recovery of possession on the ground of expiration of the lease period. The appellant claimed that the respondent assented to the continuance of possession by accepting rent for January to October 1979 and by issuing a notice dated February 23, 1980, permitting the appellant to remain in possession till August 31, 1980.
Finding of the Court:
The court held that mere acceptance of rent after the expiration of the lease period does not create a new right under Section 116 of the Transfer of Property Act unless there is an assent from the lessor. The court found that the respondent did not assent to the continuance of possession, either expressly or by implication. The court also held that the notice issued by the respondent on February 23, 1980, did not constitute an assent as it did not contain any express consent for the continuance of possession beyond the expiry of the lease term.
Issues: 1. Whether the acceptance of rent after the expiration of the lease period created a new tenancy under Section 116 of the Transfer of Property Act? 2. Whether the notice issued by the respondent on February 23, 1980, constituted an assent to the continuance of possession?
Ratio Decidendi: 1. Section 116 of the Transfer of Property Act creates an exception to the determination of a lease if the lessor assents to the continuance of possession of the lessee. 2. Assent, as defined under Section 116, implies an expression of approval or agreement. 3. Mere payment of rent does not amount to an assent unless it is demonstrated that such payment was made with a clear stipulation and/or understanding or agreement of allowing the lessee to continue in possession. 4. To constitute a valid assent under Section 116, a bilateral contract must exist between the lessor and the lessee.
Final Decision: The court dismissed the appeal, holding that there was no substantial question of law involved and that the appellant failed to prove an assent from the respondent for the continuance of possession beyond the expiry of the lease term.
HARISH TANDON, J.
Assailing the judgment and order dated June 30, 2010 passed by Additional District Judge, 5th Court, Howrah in Title Appeal No. 78 of 2005, affirming the judgment and decree dated May 21, 2005 passed by Civil Judge (Senior Division), 1st Court, Howrah in Title Suit No. 101 of 2004, the defendant/appellant has filed the instant appeal.
2. This appeal was posted under Order 41, Rule 11 of the Code under Chapter V, Rule 17 of Appellate Side Rules of High Court at Calcutta.
3. Admittedly, the defendant/appellant was inducted in respect of a suit premises on the basis of the registered deed of lease dated January 9, 1958 commencing from first day of January, 1958 for a period of 21 years at lease rent of Rs. 675/- per month according to English calendar. The said lease contained a clause for renewal for a period of 5 years on the terms and conditions to be mutually agreed upon provided a request is made by the lessee for such renewal. It is an admitted position that the lessee did not exercise the option of renewal. The tenure of the lease as stipulated in the lease deed expired on December 31, 1978. Admittedly, the rent for the months of January to September, 1979 was paid by the defendant/appellant. The plaintiff/respondent subsequently filed a suit for recovery of possession on the ground of expiration of the period reserved in the said lease dated January 19, 1958 by afflux of time which was registered as Title Suit No. 12 of 1982 in the Court of 2nd Sub Judge, Howrah. The said suit was subsequently renumbered as Title Suit No. 101 of 2004. The bare perusal of the averments made in the plaint reveals that the plaintiff/respondent founded its claim on the basis of the expiration of the lease by afflux of time with the categorical statement that the rent for the period from January to October, 1979 was accepted in ignorance and the plaintiff/respondent never assented for continuance in possession of the defendant/appellant. There was further prayer for a decree for mesne profit for wrongful and illegal possession/occupation of the defendant/appellant.
4. Although, several defence were taken by the defendant/appellant in the written statement, but the principle defence which could be deciphered therefrom is that the plaintiff/respondent after expiration of the period reserved in the said lease deed assented for continuance in possession not only on acceptance of the rent for the period from January, 1979 to October, 1979. But such assent could be deciphered from the act and conduct of the plaintiff/respondent reflected in the notice dated February 23, 1980.
5. The Trial Court held that mere acceptance of a rent after expiration of the period reserved in the deed of lease does not create any right in defendant/appellant under Section 116 of the Transfer of Property Act in absence of an assent of the plaintiff/ respondent which is found absent in the present case.
6. The appellate Court concurred with the said finding and dismissed the appeal which has been challenged before this court in this appeal.
7. Mr. Sakti Nath Mukherjee, the learned Senior Advocate appearing for the defendant/ appellant strenuously submits that although, mere acceptance of rent after expiration of the period limited in the lease deed does not result into a creation of new right under Section 116 of the Transfer of Property Act, unless an assent of the lesser exist in express words or by necessary implication. He succinctly argues that the intention of the plaintiff/respondent, so far as it relates to grant of an assent is inferred from the notice dated February 23, 1980 issued by the learned lawyer of the plaintiff/respondent permitting the defendant/appellant to remain in possession till 31 August, 1980. He further placed reliance upon the examination-in-chief of P.W.1 who categorically stated that the content of the said notice is true and correct. He put much emphasis on the point that the mistake of law may render the agreement void o
