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2026 Supreme(Online)(Kar) 22724

THE HIGH COURT OF KARNATAKA
Anant Ramanath Hegde, J
Sunitha Agarwal – Appellant
Versus
Rajashree Enterprises – Respondent
RFA No. 524 of 2019



Advocates:
For the Appellants/Petitioners: Arun Goindraj, Govindaraj L
For the Respondents: K N Krishna Rao

The jural relationship between parties regarding property occupancy is determined by the intent of the contracting parties and their evidentiary record, rather than the nomenclature (lease vs. license) alone. Once a license term expires, the licensor is entitled to recovery of possession without prejudice to the occupant.

Headnote:(A) Transfer of Property Act, 1882 - Lease vs. License - Determination of jural relationship - Appellant contended that despite nomenclature of the agreement being 'license', the long-term possession since 1993 and evidence of previous lease agreements establish a landlord-tenant relationship - Court observed that the parties consciously opted for a license agreement after earlier leases expired - Nomenclature is not sole criterion, but intention and surrounding circumstances determine the nature of the contract. (Paras 20, 23, 29, 32)

(B) Appeals - Scope of interference - Appellate courts should not interfere with lower court's findings unless perverse or illegal - No prejudice caused to appellant by suit nomenclature as parties were heard on merits regardless of whether the suit was for eviction under Rent/Property laws or for possession under License. (Paras 34, 39)

(C) Damages - Quantum - Trial court awarded monthly damages of Rs. 1,00,000/- from the date of judgment; this was upheld as reasonable considering the time elapsed since the suit's inception. (Para 39)

Facts of the case:
Appellant (defendant) had occupied the premises since 1993 under successive lease agreements. In 2012, a license agreement was executed. Respondent (plaintiff) sought possession and damages after the expiry of the license. The trial court decreed the suit, declaring the defendant a licensee and ordering vacant possession and damages.

Findings of Court:
Relationship is that of Licensor and Licensee. No prejudice to defendant regardless of the legal framework applied, as the tenure expired.

Issues: Whether the appellant is a tenant or licensee and whether the suit for possession is maintainable.

Ratio Decidendi: The character of a contract is determined by the intent of the parties and the totality of evidence, not merely the label. Since the parties consciously entered a license agreement, they are bound by its terms.

Result: Appeal dismissed.

Table of Content
1. overview of suit for possession and status of occupancy. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8)
2. arguments regarding determination of jural relationships (licensee vs tenant). (Para 9 , 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17 , 18)
3. analysis of contractual intent and the distinction between lease and license. (Para 19 , 20 , 21 , 22 , 23 , 24 , 25 , 26 , 27 , 28 , 29 , 30 , 31 , 32 , 33)
4. determination of damages and final order for vacant possession. (Para 34 , 35 , 36 , 37 , 38 , 39 , 40 , 41 , 42 , 43)

THIS APPEAL, COMING ON FOR ADMISSION THIS DAY,

JUDGMENT WAS DELIVERED THEREIN AS UNDER:

CORAM: HON'BLE MR. JUSTICE ANANT RAMANATH HEGDE

ORAL JUDGMENT

This appeal is listed for Admission today. Considering the nature of the controversy involved in this matter and since the respondent-caveator is also served and is before the Court, the Court has considered the appeal on merits.

2. The respondent/plaintiff filed a suit in O.S.No.2024/ 2014 seeking delivery of vacant possession of the suit property on the premise that the suit property is licensed to the defendant and the license has come to an end. The plaintiff also sought damages at the rate of Rs.1,00,000/- per month from the date of the suit till the date of realisation with interest at the rate of 24% per annum.

3. The suit is filed on the premise that, on 04.07.2012, plaintiff and defendant entered into a license agreement and the defendant occupied the premises as a Licensee. The plaintiff claims that the tenure of the license is 11 months starting from 01.01.2012 to 30.11.2012. The monthly license fee agreed is Rs.60,000/- per month according to the plaintiff. The plaintiff further claims that with effect from 01.01.2013, the defendant is paying enhanced license fee of Rs.63,000/- per month.

4. The suit is filed on 12.03.2014 on the premise that the defendant has failed to vacate the premises even after expiry of 15 days notice to vacate the premises. As already noticed, defendant also claimed Rs.1,00,000/- per month towards damages.

5. The defendant has resisted the suit. Defendant raised a contention that he is in possession of the property as a tenant and his tenancy is traceable to the lease agreement of the year 1993 which was for 10 years, and later was renewed for another 10 years from 2003 to 2012. Admittedly, both the lease deeds are unregistered. However, defendant is in possession of the property since 1993, this fact is not in dispute.

6. Defendant also raised a contention that since he is a tenant, notwithstanding the lease agreement dated 04.07.2012, the defendant cannot be evicted unless there is a suit for eviction under the provisions of the Transfer of Property Act, 1882 (for short 'Act of 1882').

7. The Trial Court framed following four issues:

1. Whether the plaintiff proves the jural relationship of landlord and tenant between itself and the defendant?

2. Whether the plaintiff proves that it has terminated the tenancy rights of the defendant legally and validly?

3. Whether the plaintiff is entitled for the reliefs as prayed for?

4. What Order or decree?

8. Later, the issues have been recast vide order dated 01.04.2015. Paragraph No.4 of the judgment under challenge would disclose that the issues which have been recast have been wrongly numbered as 1 and 2 instead of 3 and 4. However, the order dated 01.04.2015 would indicate that issues No.1 and 2 have been recast as referred to above raising issue relating to licence.

(3) Whether plaintiff proves that the defendant is a licensee?

(4) Whether the defendant proves that the relationship between the plaintiff and defendant is that of lessor and lessee?

9. The Trial Court recorded the evidence and came to the conclusion that the plaintiff is a Licensor and the defendant is a Licensee.

10. The judgment would also indicate at page No.5 paragraph No.6 that original issue No.1 relating to the jural relationship of landlord and tenant and issue No.2 relating to legality of termination of tena

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