SUPREME COURT OF INDIA
4-5-1951
FAZL ALI, B.K. MUKHERJEA AND CHANDRASEKHARA AIYAR, JJ.
Karnani Industrial Bank Ltd. - Applts.
Versus
The Province of Bengal and others -Resps.
Civil Appeal No. 58 of 1950.
Advocates appeared
Shri. C. Chatterjee & Shri Harish Chandra, Sr. Advocate (Shri K.C. Chopra & Shri G C Mathur, Advocate, with them) instructed by Shri Rajinder Narain, Agent - for Applts.; Shri Chandra Sekhar Sen, Sr. Advocate (Shri C. N. Laik, Advocate with him) instructed by Shri P. K. Bose, Agent - for Resp. 1.
– For application of the provisions of this section two things are necessary : (1) the lessee should be in possession after the termination of the lease; and (2) the lessor or his representative should accept rent or otherwise assent to his continuing in possession. The use of the word “otherwise” suggests that acceptance of rent by the landlord has been treated as form of his giving assent to the tenant’s continuance of possession. There can be no question of the lessee “continuing in possession” until the lease has expired, and the context in which the provision for acceptance of rent finds a place clearly shows that what is contemplated is that the payment of rent and acceptance should be made at such a time and in such a manner as to be equivalent to the landlord assenting to the lessee continuing in possession — See decision in Karnani Industrial Bank Ltd. v,. The Province of Bengal, AIR 1951 SC 285.
Judgment
Fazl Ali J.- The principal question for determination in this appeal is whether a certain lease had validly terminated by efflux of time or whether there was holding over" by the lessee of the leasehold property as contemplated in S.116, T. P. Act. The circumstances under which this question & several subsidiary questions to which reference will be made later have arisen may be briefly stated as follows.
2. The Province of Bengal (hereinafter, refd. to as the resp. 1 or pltf., is admittedly the owner of an area of 1125 bighas & odd of land in villages Akra. On 17-9-1928, the resp. 1 executed a lease (Ex. 3) in respect of the said land for 10 years for manufacture of bricks in favour of the applt. at a rental of Rs. 6,000 a year. The lease was to commence from 24-9-1928, & a year s rent was payable in advance. By the terms of the said lease, the lessee was prohibited from assigning or subletting the premises or any part thereof without the consent of the lessor except to a limited co. & the lease also contained a general provision that the lessee would at the expiration of the lease restore to the lessor the demised premises in as good condition as it was at the date of the lease, reasonable wear & tear excepted. Two further clauses in the lease, which are material for the decision of this appeal, may be reproduced verbatim : Clause 11 of Part I of the Schedule. "The Secretary of State reserves the right to terminate the lease at any time subject to six months notice in the event of the lessee s failing to observe & duly perform the conditions hereinbefore & after mentioned & it is hereby agreed that the lessee shall before the expiration or prior termination of the lease hereby granted remove his boilers engines, trucks, kilns rly & tram lines bricks tools & plant & all, other materials whatsoever & yield up the said demised premises unto the Secretary of State & that those bricks tools & plant & other materials that shall not be removed before such expiration or prior termination shall become the property of the Secretary of State." Clause 1 of Part III of the Schedule. The lessee shall be at liberty to keep on the said premises hereby demised for three months after the expiration or prior termination of the term of this lease any bricks boilers engines tracks kilns rly. & tram lines & all other materials whatsoever as may have been manufactured by him in the premises in accordance with the conditions of these presents but any bricks & other materials left in contravention to this condition shall become the absolute property of the Secretary of State without payment." It may be stated here that at the time of the execution of the lease, the lessee had purchased from the lessor for Rs. 50,000 "all the boilers, engines, trucks, kilns. rly. & tramway lines & all other movable property, plant & machinery, on the demised premises."
3. The case of the resp. 1, who is the pltf. in the present litigation, is that the applt. (deft. 1) had, in contravention of the terms of the lease, sublet the brickfield to defts-resps 2 to 18 without the consent of resp. 1, & they had caused serious damage to the brick field in general & failed to maintain the embankments, slices, etc. in proper repair resulting in a total loss of Rs. 16,840. It was further alleged that the defts. had refused to deliver possession though the lease had terminated, & they had not removed the bricks, pug mills & other materials within 3 months from the termination of the lease. On these allegations the resp. 1 prayed for the following reliefs : (a) a decree for ejectment & khas possession over the brickfield : (b) damages amounting to Rs. 4,000 for the period between the termination of the lease & the institution of the suit & mesne profits for the subsequent period: (a) decree for Rs. 16, 840 for damages caused to the field ; & (d) a decree for permanent injunction restraining the defts. from removing or otherwise disposing of the bricks, pugmills, etc. w
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