IN THE HIGH COURT OF JAMMU AND KASHMIR AT SRINAGAR
S.N. Jha, J.
Ab. Ahad Kana - Appellant
Versus
Habibullah Kaloo - Respondent
Civil Revision No. 128/2003
Decided On : 17 August, 2004
lease - dispute over nature of agreement - Jammu and Kashmir Houses and Shops Rent Control Act, 1966 - Cobb v. Lane, (1952) ALL ER 1199 - Associated Hotels of India Ltd. v. R. N. Kapoor, AIR 1959 SC 1262 - Sohan Lal Naraindas v. Laxmidas Raghunath Gadir, (1971)1 SCC 276 - V. Muhammadkutty v. Illikkal Moosakutty, AIR 1996 SC 3288 - Delta International Ltd. v. Shyam Sundar Ganeriwalla, (1999) 4 SCC 454
Fact of the Case:
The plaintiff filed a suit seeking mandatory injunction to evict the defendant from the premises, claiming that the defendant was a licensee and not entitled to protection under the Jammu and Kashmir Houses and Shops Rent Control Act, 1966. The defendant claimed that the agreement was for lease and not licence, and therefore, the suit was not maintainable.
Finding of the Court:
The court found in favor of the defendant, holding that the agreement was for lease and not licence, and therefore, the suit was not maintainable.
Issues: Dispute over the nature of the agreement - Whether the defendant was a licensee or a lessee - Applicability of the Jammu and Kashmir Houses and Shops Rent Control Act, 1966
Ratio Decidendi: The determination of whether an agreement creates a lease or licence depends on the intention of the parties, which is to be ascertained from the terms and conditions of the agreement. The test of exclusive possession is significant but not conclusive. The court emphasized the importance of examining the surrounding circumstances and conduct of the parties to ascertain the real relationship between the parties.
Final Decision: The civil revision was dismissed, and the finding in favor of the defendant determined the course of the suit. The plaintiff was given the opportunity to challenge the finding in appeal and present evidence to support the claim that the agreement was for licence and not lease.
2. In Cobb v. Lane, (1952) ALL ER 1199, it was observed that in the former days, except for the question of the statute, the distinction between a tenancy, whether at will or for a period, and a licence was not so important as it has become since the Rent Restrictions Acts came into operation. If the document is held to be licence deed, the defendant, as a tenant, the lessee, would be entitled to the protection of Jammu and Kashmir Houses and Shops Rent Control Act. 1966. According to the plaintiff, the defendant is a licensee and, therefore, not entitled to such protection.
3. The suit has been filed in the form of mandatory injunction directing the defendant to vacate the suit premises and handover the same to the plaintiff, and for damages or mesne profits with interest from 6th November, 1993 till the date of handing over of possession. The case of the plaintiff, briefly, is that he is the owner of a two storeyed building at Chotabazar, Mohalla Khushalmatu, Sopore. Two shops on the ground floor of the building were given to the defendant for use as a warehouse on certain conditions as mentioned in the document. It was a grant of personal privilege in favour of the defendant to store saleable goods except inflammable or contraband goods, which did not create any interest in the premises. The first licence was granted on 6th November, 1980 for one year. On the request of the defendant, the licence was renewed year to year, on the same terms and conditions, upto 6th November, 1993. Being in bonafide need of the premises to settle his unemployed son in business, the plaintiff did not extend the period of licence. After the extension was refused, the defendant was bound to surrender possession of the licensed shop but, despite requests and demands, he continued to occupy the same and, being thus a trespasser, he is liable not only to ejectment but also to pay compensation and damages as mesne profits. A legal notice was served on the defendant on 1st August, 1996 calling upon him to vacate the premises with no result. In the circumstances, he instituted the suit.
4. The defendant filed written-statement in which he took the stand that the shops, which he had taken on rent from the plaintiff, gutted in fire. The plaintiff delayed reconstruction. As the defendant was suffering monetarily on account of debts to customers and suppliers, he took loan and constructed the shop on his own expense, and that is how it is in his possession. It is the plaintiff who owes money to him As such, the suit is not maintainable and liable to be dismissed. Defendant further stated that the plaintiff had assured him that the shop would continue to remain in his occupation. He was given to understand that agreement was being executed for tax purpose and family partition.
5. As the result of the case largely depends on construction of the agreement, the relevant terms and conditions thereof may straight away be quoted as under:
"4. The shop will remain in occupation of the licencee for a period of one year from 6th Nov. 1980 and during this period the licencee will not store or keep any kind of inflammable or other contra-band things in the shop.
5. The licencee hereby agrees and undertakes that he will not sublet the licenced shop to any other person or allow any other person to occupy the licenced shop in any capacity whatsoever.
7. The licensor will be eligible to inspect and see the licenced shop at any time during the day time either himself or through any of his authorized agents and the licencee is bound to render all assistance and opportunity to the licensor in this re
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