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2023 Supreme(Online)(KER) 24123
HIGH COURT OF KERALA
ANIL K. NARENDRAN, P. G. Ajithkumar, JJ
ASHOK HARRY POTHEN – Appellant
Versus
PREMLAL – Respondent
OP (RC) 119 2023
S.EASWARAN, K.V.RAJESWARI, P.MURALEEDHARAN, G.RAJEEV, AJITH KUMAR.S, ASWANI, P.S.NAVEEN, RADHAKRISHNAN, JYOTHSNA G., ARDRA MINI SATISH
The distinction between lease and licence is based on intention and the nature of rights granted, crucial for determining liability and eviction under rent control legislation.
Headnote:
Tenant - Rent Control - Kerala Buildings (Lease and Rent Control) Act, 1965 - Sections 11, 12 - The court distinguished between 'lease' and 'licence', confirming that the transaction in question was a licence, affecting the outcome of the eviction proceedings favorably for the petitioner.
Fact of the Case:
The respondent sought eviction of the petitioner for non-payment of rent under the Kerala Buildings Act. The petitioner claimed he was a licensee, not a tenant, and disputed the arrears and nature of the agreement.
Finding of the Court:
The court found that the agreement, despite being labeled as a licence, constituted a lease based on its terms and evidence. Key elements included clauses that supported rental arrangements and the context of the transaction.
Issues: Whether the arrangement between the parties constituted a lease or a licence, impacting the validity of the eviction proceedings initiated by the respondent.
Ratio Decidendi: The court held that the essential factors to distinguish between a lease and a licence are the parties' intention and the nature of possession and enjoyment rights conferred by the agreement.
Final Decision: The court set aside the Rent Control Court's order regarding eviction.
JUDGMENT
P.G. Ajithkumar, J.
The respondent-tenant in R.C.P.No.35 of 2022 on the file of the Rent Control Court (Additional Munsiff), Thiruvananthapuram, has filed this Original Petition under Article 227 of the Constitution of India. He is aggrieved of Ext.P7 order of the Rent Control Court in I.A.No.1 of 2022 in that rent control petition.
2. Heard the learned counsel appearing for the petitioner and the learned counsel appearing for the respondent.
3. R.C.P.No.35 of 2022 was filed by the respondent seeking eviction of the petitioner under Section 11 (2)(b) and 11(3) of the Kerala Buildings (Lease and Rent Control) Act, 1965 . The respondent contended that the petition schedule premises was let out to the petitioner on a monthly rent of Rs.1,65,000/- as per a lease agreement dated 15.07.2015. There was stipulation for yearly enhancement of rent by 10%.
The respondent filed I.A.No.1 of 2022 alleging that the petitioner defaulted payment of rent and as on February, 2022, an amount of Rs.1,32,69,902/- remained to be paid towards arrears of rent. It is further averred by the respondents that although an agreement for sale of the petition schedule building was entered into between the parties on 23.03.2017, the sale did not get through for the fault of the petitioner. Hence the advance sale consideration paid by the petitioner was adjusted against the rent. Adding the subsequent arrears till 15.10.2022 the rent amount due is Rs.1,04,74,693/-. On the said premises the respondent filed I.A.No.1 of 2022.
4. The petitioner took the stand that he was not a tenant, but a licensee. The document dated 15.07.2015 is a licence deed. The description of the petition schedule premises is different from what has been described in the said licence deed. The premises were handed over to the petitioner for a specific purpose of conducting a car showroom and parking facilities. The liability to pay rent as claimed by the respondent was refuted by the petitioner. He contended that on executing agreement for sale dated 22.03.2017, the possession of the premises was handed over to the petitioner. Rs.25,00,000/- which was paid as advance sale consideration and the deposit amount paid at the time of executing the licence deed on 15.07.2015 are with the respondent. In such circumstances, he has no liability to pay the licence fees as agreed to in the said document.
5. Since the respondent did not come forward to execute the sale deed in terms of the agreement dated 22.03.2017, the petitioner issued notice to the respondent and his sister asking them to execute the sale deed after receiving the balance sale consideration. There occurred mediation talks in that regard, but the same was not fruitful. The period of licence is 10 years, which will be over only by September, 2025. For those reasons the petitioner denied his liability to pay the rent. He, however, did not claim that he paid the rent after August, 2017.
6. The Rent Control Court received in evidence Exts.A1 to A3 and Exts.B1 to B11 for the purpose of deciding I.A.No.1 of 2022. After considering the said documents and also the submissions by either side, the Rent Control Court took the view that Ext.A1, document dated 15.07.2015 is predominantly a rent agreement and the plea of the petitioner was not tenable. Accordingly, the petitioner was directed to deposit Rs.1,65,97,286/- being the arrears of rent admitted to be due for the period from 31.03.2017 to 15.03.2023 within a period of four weeks from the date of that order. The petitioner was further directed to deposit the rent for the future periods as well.
7. The learned counsel appearing for the petitioner would submit that Ext.P1 is a licence deed in every sense, and therefore, finding entered into by the Rent Control Court is incorrect. After referring to various clauses in Ext.P1, the learned counsel would submit that the petitioner was given permission to occupy the premises for the specific purpose of conducting a car showroom and related ope
