The intention of the parties, exclusive possession, and payment of rent are paramount considerations in determining whether a transaction creates a lease or a licence.

V.B. Gupta, J.

1. The appellant has filed this appeal against the judgment and decree dated 23rd October, 1989 passed by Addl. District Judge, Delhi in Suit No. 584/1988.

.2. The brief facts of this case are that respondent herein, filed a suit for recovery of Rs. 59,800/- and for mandatory injunction against the present appellant on the allegations that she is the proprietor of M/s Paul Traders and appellant through its Managing Director Sh. S.S. Aggarwal entered into a collaboration-cum-agency agreement with her on 18th October, 1992 as per terms and conditions mentioned therein. Sh. S.S. Aggarwal admitted the contents of the said agreement as correct and signed the same in the presence of attesting witnesses. Said agreement was for 36 months from 1st October, 1982 ending on 30th September, 1985. Appellant despite the expiry of said period, failed to remove its machinery, parts, etc. from the business place of the respondent despite repeated request and demand made by the respondent. Appellant also failed to pay the commission charges in terms of the said agreement. It is stated that appellant was liable to pay minimum of Rs. 21,200/- per year or 1/10 % commission on the value of the manufactured goods during the year, whichever was higher. From 1st October, 1982 till date, appellant had paid a sum of Rs. 1,11,200/- on that account and now a sum of Rs. 59,800/-on account of the commission for the period ending 31st March, 1988 is due to the respondent.

3. The appellant was also liable to furnish the account for the said year in order to ascertain the commission, if found higher than the minimum commission, then the respondent would be entitled for difference of the commission. Since appellant has failed to pay the aforesaid amount despite repeated demands and has failed to remove the machinery etc., a suit for mandatory injunction and for recovery of Rs. 59,800/- was filed before the trial court.

4. The suit was contested by the appellant. The plea of the appellant was that he is a tenant of the entire premises in question, that is, ground floor with first Mezanine in between the ground and first floor, and first floor consisting of office and second Mezanine etc., since October, 1979 at a monthly rent of Rs. 2,300/-. Since no rent agreement was possible for the reason that the premises could not be rented out as per Bye-Laws of the Directorate of Industries - the lessor of the premises, as such a Collaboration-cum-Agency Agreement for a period of three years was entered between the parties, as per general practice prevailing in such types of cases. In October, 1982 on the expiry of three years of tenancy, the rent was increased to Rs. 2,600/- per month and agreement was again renewed for another period of three years. The physical and exclusive possession of the entire premises was given by respondent and the same remained with the appellant as such.

5. It is further stated that originally the premises was allotted by the Directorate of Industries in the name of Sh. Sardari Lal, Proprietor of M/s Paul Traders in 1985 who transferred the same in favour of Sh. Gurdeep Singh who in turn transferred to Sh. S.L. Khurana and who in turn transferred the same to respondent. Directorate of Industries vide letter dated 10th December, 1984 cancelled the allotment in favour of M/s Paul Traders and determined the said lease. To get the restoration of allotment of the premises, respondent approached and induced the appellant to issue a certificate mentioning that he (appellant) was in possession of 500 Sq. feet of covered area, though in fact the appellant was in possession of the entire premises. Appellant issued the certificate in good faith in or around early 1985.

6. Thereafter respondent made certain unauthorised construction in the shape of two big rooms and agreed to reduce the rent from Rs. 2,600/- to Rs. 2,300/-, for the facility being granted by the appellant to the respondent for the approach on the said unauthorized