IMPORTANT POINT
Surrender of lease cannot happen unless the term is vested in the lessee. There must be a taking of possession, not necessarily a physical taking, but something amounting to a virtual taking of possession-The lease was expected to happen on a future date. The subject matter of the lease is not in existence even now- At no point of time was the possession of the premises handed over to the 4th respondent as the lease premises is not in existence even now.

JUDGMENT :

1. The petitioners herein, who are husband and wife respectively, are the owners in title and possession of property having an extent of 15.77 Ares and situated within the limits of Perumbaikad village. In the year 2018, the petitioners decided to construct a commercial building in the said property and based on their application, a mercantile/commercial building permit was issued by the local authority.

2. On receiving information about the commercial building project, the 4th respondent, who is a hotelier, approached the petitioners and informed them of his desire to take on lease 6000 sq. ft. of commercial space on the ground floor of the proposed commercial building for the purpose of starting a hotel therein. After deliberations, the parties entered into an understanding as per which, the petitioners offered to complete the structure of the building and hand over the space to the 4th respondent on or before 31.12.2020 and the 4th respondent agreed to take on lease the said commercial space at a monthly rent of Rs. 3,30,000/- for a period of five years, and to commence from 1.1.2021. Consequently, Ext.P1 agreement for lease was entered into on 23.12.2019. The document was presented before the SRO, Kottayam and the same was registered as document No. 2415/I/2019. A sum of Rs. 2,55,700/- was paid towards stamp duty and registration fee.

3. The petitioners state that COVID-19 Pandemic struck immediately thereafter and due to the restrictions imposed, it became next to impossible to commence and carry out the construction. The workers also left and nothing further took place. The entire project was shelved by the petitioners and he decided not to go forward with the construction. This matter was informed to the 4th respondent, who also expressed his desire to withdraw from the project. In other words, the pandemic played spoilsport and the hotel project was dropped.

4. The petitioners and the 4th respondent in the said circumstances executed Ext.P2 deed of cancellation on 8.11.2020 cancelling Ext.P1 lease agreement. The deed of cancellation was executed on a non-judicial stamp paper valued at Rs. 500/- and a sum of Rs. 270/- was paid as registration fee. They state that stamp duty was paid in accordance with Article 15 of the Schedule to the Stamp Act and registration fee was paid under I(u) of the Table of Fees under Section 78 of the Registration Act (Table of Fees). However, when Ext.P2 cancellation deed was presented before the 3rd respondent for registration, he refused to register the same on the ground that Ext.P2 would fall within the category of surrender of lease as provided under Article 54(a) of the Schedule 1 of the Stamp Act and registration fee would be payable under Article 1(g) of the Table of Fees. The 1st petitioner was ordered to pay the balance registration fee of Rs. 2,01,978/- by Ext.P4 order.

5. According to the petitioner, Ext.P1 on the face of it would reveal that the lease is scheduled to commence only on 1.1.2021. The petitioners have not completed the construction of the building and the 4th respondent has not occupied the same, which event is yet to happen. The possession of the property is also with the petitioners. According to the petitioners, in order to term Ext.P2 as a surrender of lease, the parties ought to have acted upon the lease and the 4th respondent ought to have taken possession of the premises either by express or by implied means. In that view of the matter, there is no justification on the part of the Registrar to insist that the petitioner should pay registration fees under Article 1(g) of the Table of Fees, contends the petitioner. It is in the afore circumstances that the petitioners are before this Court seeking to quash Ext.P4 and also for a further direction to the 3rd respondent to register Ext.P2 as a deed of cancellation.

6. The 3rd respondent has filed a statement as directed by this Court. It is stated that the rights created under the lease for a period of 5 year