MTHE HONOURABLE MR v. Kalimuthu Rajan

The original defendant/appellant filed the suit O.S.No.398 of2002 as against the defendant seeking the following reliefs: "(a) directing the defendant to quit and deliveryvacant possession of the suit premises at Plot No.1070,Door No.386, I Cross Street, Nehru Nagar, Kottivakkam,Chennai 600 041, to the plaintiff;(b) directing the defendant to pay the sum ofRs.1,01,200/- to the plaintiff towards lease rentarrears from 15.12.2000 to 15.02.2002;(c) directing the defendant to pay future rent fromthe date of presentation of the plaint till the date ofeviction;(d) directing the defendant to pay costs of thissuit to the plaintiff; and(e) for such other reliefs as this Hon'ble Courtmay deem fit and proper in the circumstances of the caseand render justice."The defendant entered appearance and filed the written statementresisting the suit. 3. The trial Court framed the relevant issues. During trial,the plaintiff examined himself as P.W.1 and Exs.A1 to A4 weremarked. The defendant examined himself as D.W.1 and Exs.B1 to B3were marked.4. Ultimately the trial Court decreed the suit in favour of theplaintiff, as against which First Appeal was filed, for nothing butto be dismissed by the appellate Court, confirming the judgment anddecree of the trial Court.5. Being disconcerted and aggrieved by the judgment and decreeof both the Courts below, this Second Appeal is focussed on variousgrounds and also setting out some substantial questions of law.6. After hearing for some time the arguments on both sides, thisCourt felt that on the consent of both sides, this matter could bedisposed of finally by framing the following substantial question oflaw:"Whether both the Courts below erred in upholdingthat there is valid termination of tenancy of thedefendant by the plaintiff's notice?" https://hcservices.ecourts.gov.in/hcservices/

7. A plain poring over and perusal of the relevant recordsincluding the certified copies of the judgment and decrees of boththe Courts below would display and demonstrate that the plaintifffiled the suit for evicting the defendant and for recovery of arrearsof rent after issuing the termination notice. Whereas, the defendantfiled the written statement and resisted the suit by setting outvarious pleas, including the one that there was no valid terminationof tenancy.8. Both sides advanced arguments touching upon the substantialquestions of law.9. Ex.A2 dated 08.06.2000 is the notice sent by the plaintiff tothe defendant by way of reply to Ex.A1, the defendant's notice andalso terminating the tenancy of the defendant by the end of 30th June2000 and calling upon him to hand over possession of the suitproperty by 1st of July 2000.10. Indubitably and incontrovertibly, unassailably andadmittedly, subsequent to such notice also there were payments ofrent by the defendant and acceptance by the plaintiff. As such, ithas to be taken that Ex.A2, the termination notice had lost itssignificance. However, subsequently there were correspondencesbetween the parties, and the plaintiff as per Ex.A3, the notice dated03.01.2002 stated thus in paragraph 7 and 8 and it is extracted hereunder for ready reference."7. We therefore call upon you to pay the sum ofRs.72,400/-due from you towards the rental arrears,immediately. Also note that you are liable to pay monthlyrent from January, 2002 onwards if you continue inoccupation of the premises.8. Failure to pay the rent arrears our client will beconstrained to initiate appropriate legal action to evictyou from the premises and also for recovery of rentarrears and you will also be made liable to face the costsand consequences." (emphasis supplied)11. The learned Senior Counsel for the plaintiff would advancehis argument that the words as found in paragraph 8 of Ex.A3, morespecifically, the words "to initiate appropriate legal action toevict you from the premises" are sufficient for being taken astermination notice, as it is the second notice in the process ofevicting the defendant.12. Whereas, the learned Senior Counsel for the defendant wouldsubmit that there is not even any time limit prescribed in Ex.A3 and https://hcservices.ecourts.gov.in/hcservices/ atleast if there is some time limit found specified in Ex.A3 and itis found out to be inadequate, then Section 106 of the Transfer ofProperty Act, 1882 as amended by the Transfer of Property (Amendment)Act, 2002 (3 of 2003) would come to the rescue of the plaintiff, buthere that is not the case. The learned Senior Counsel for thedefendant also would submit that here the lease was for manufacturingpurpose and hence six months notice was contemplated. 13. At this juncture, I would like to point out that Ex.A3,notice is dated 03.01.2002, whereas, the present suit was filed on15.02.2002, so to say, long after the issuance of the said notice,Ex.A3, at any rate, much more than 15 days and there is no disputeover that. However, the question arises as to whether six monthsnotice is contemplated or only 15 days notice would be sufficient.14. The learned Senior Counsel for the plaintiff, correctly andappropriately would cite the following decisions of the Hon'ble ApexCourt as well as this Court:(1) 1995(5)SCC 314 [Shri Janki Devi Bhagat Trust, Agra vs. RamSwarup Jain (Dead) by Lrs.]An excerpt from it would run thus:"4. Under Section 107 of the Transfer of PropertyAct a lease of immovable property from year to year orfor any term exceeding one year can be made only by aregistered instrument. Any lease of this kind would bevoid unless it is created by a registered instrument.All other leases of immovable property may be madeeither by a registered instrument or by an oralagreement accompanied by delivery of possession. Allthe courts below have held that there was a validlease. The High Court has also recorded that it was notthe contention of the respondent that his lease wasfrom year to year. The contention was that the leasewas for a term exceeding one year and was, therefore,compulsorily registerable under the first part ofSection 107 of the Transfer of Property Act. Thiscontention has been negatived by the High Court as alsoby both the courts below. The High Court has held thatthe lease was not for a term exceeding one year, and sowas not compulsorily registerable under the first partof Section 107. It, however, held that since the leasewas for a manufacturing purpose, six months’ notice toquit was required under Section 106. In its absence,termination was not valid. https://hcservices.ecourts.gov.in/hcservices/

5. This reasoning is fallacious. It is true thatEx. 12 which is not registered, cannot be looked atbecause it is not registered. But the factum of leaseis not in dispute. All the courts have held that it wasa lease from month to month and was not for a termexceeding one year. In view of this finding, thedeeming provisions of the first part of Section 106 ofthe Transfer of Property Act cannot be attracted in thepresent case.6. Section 106 provides, inter alia, that in theabsence of a contract between the parties, a lease ofimmovable property for manufacturing purposes shall bedeemed to be a lease from year to year terminable bysix months’ notice. In the present case there is aclear finding to the effect that the lease in questionwas not from year to year or for a period exceeding oneyear. Therefore, even though the lease may be for amanufacturing purpose, since the lease was not fromyear to year, six months’ notice was not required. Amanufacturing lease which is not from year to year doesnot require six months’ notice of termination. It willfall in the second half of Section 106, requiringfifteen days’ notice of termination. A lease from monthto month or a lease other than a lease from year toyear is terminable by fifteen days’ notice. Hence thenotice in the present case is a valid notice to quit.The High Court, having come to the conclusion that thelease was not for a period exceeding one year, and wasnot a lease from year to year erred in holding that sixmonths’ notice to quit was required. Such a notice isrequired, provided there is no contract to thecontrary, only when a manufacturing lease is, or isdeemed to be, from year to year. This not being thecase, the lease is terminable by fifteen days’ noticeeven if the lease is a manufacturing lease.(2) (2006) 4 SCC 205 [Sarup Singh Gupta vs. S.Jagdish Singh andothers]An excerpt from it would run thus:8. In the instant case, as we have noticed earlier,two notices to quit were given on 10-2-1979 and 17-3-1979. The suit was filed on 2-6-1979. The tenantoffered and the landlord accepted the rent for themonths of April, May and thereafter. The question iswhether this by itself constitutes an act on the partof the landlord showing an intention to treat the lease https://hcservices.ecourts.gov.in/hcservices/ as subsisting. In our view, mere acceptance of rent didnot by itself constitute an act of the nature envisagedby Section 113, Transfer of Property Act showing anintention to treat the lease as subsisting. The factremains that even after accepting the rent tendered,the landlord did file a suit for eviction, and evenwhile prosecuting the suit accepted the rent which wasbeing paid to him by the tenant. It cannot, therefore,be said that by accepting rent, he intended to waivethe notice to quit and to treat the lease assubsisting. We cannot ignore the fact that in anyevent, even if rent was neither tendered nor accepted,the landlord in the event of success would be entitledto the payment of the arrears of rent. To avoid anycontroversy, in the event of termination of lease thepractice followed by the courts is to permit thelandlord to receive each month by way of compensationfor the use and occupation of the premises, an amountequal to the monthly rent payable by the tenant. Itcannot, therefore, be said that mere acceptance of rentamounts to waiver of notice to quit unless there be anyother evidence to prove or establish that the landlordso intended. In the instant case, we find no other factor circumstance to support the plea of waiver. On thecontrary, the filing of and prosecution of the evictionproceeding by the landlord suggests otherwise.(3) (2001) 3 MLJ 22 (S.C.) [Samir Mukherjee vs. Davindar K.Bajajand others]An excerpt from it would run thus:6. Section 107 prescribes the procedure for executionof a lease between the parties. Under the first para ofthis section a lease of immovable property from year toyear or for any term exceeding one year or reserving ayearly rent can be made only by a registered instrumentand remaining classes of leases are governed by the secondpara, that is to say all other leases of immovableproperty can be made either by a registered instrument orby an oral agreement accompanied by delivery ofpossession.7. In the case in hand we are concerned with an orallease which is hit by the first para of Section 107 of theTransfer of Property Act. Under Section 107 parties havean option to enter into a lease in respect of an immovableproperty either for a term less than a year or from year https://hcservices.ecourts.gov.in/hcservices/ to year, for any term exceeding one year or reserving ayearly rent. If they decide upon having a lease in respectof any immovable property from year to year or for anyterm exceeding one year, or reserving a yearly rent, sucha lease has to be only by a registered instrument. In theabsence of a registered instrument no valid lease fromyear to year or for a term exceeding one year or reservinga yearly rent can be created. If the lease is not a validlease within the meaning of the opening words of Section106 the rule of construction embodied therein would not beattracted. The above is the legal position on a harmoniousreading of both the sections.8. In Ram Kumar Das, (1952) 3 S.C.R. 269 : AI.R. 1952S.C. 23, Section 106 was considered by a Bench of fourJudges of this Court. This Court held that this Section106 lays down the rule of construction which is to beapplied when there is no period agreed upon between theparties and in such cases duration has to be determined byreference to the object for the purpose for which tenancyis created. It was also held that the rule of constructionembodied in this section applies not only to expressleases of uncertain duration but also to leases implied bylaw which may be inferred from possession and acceptanceof rent and other circumstances. It was further held thatit is not disputed that a contract to the contrary ascontemplated by Section 106 of the Transfer of PropertyAct need not be an express contract; it may be implied,but it certainly should be a valid contract. On the factsof the case, the Court held that “the difficulty inapplying this rule to the present case arises from thefact that a tenancy from year to year or reserving anyearly rent can be made only by registered instrument, aslaid down in Section 107 of the Transfer of Property Act”.(Italics supplied)9. In a recent decision of this Court in Janki DeviBhagat Trust, Agra, (1995) 5 S.C.C. 314, this Court heldthat under Section 107 of the Transfer of Property Act alease of immovable property from year to year or for aterm exceeding one year can be made only by a registeredinstrument and any lease of this kind would be void unlessit is so created.10. In the present case though the appellant hasclaimed that it was a lease for manufacturing purpose,admittedly there was no registered written lease.Therefore, the rule of construction as envisaged in https://hcservices.ecourts.gov.in/hcservices/ Section 106 would not be applicable as the statutoryrequirement of Section 107 of the Act has not beensatisfied. The plea of the appellant that 15 days’ noticeterminating the present tenancy is bad in law would not besustainable."(4) 2005(4) L.W.257 [K.Kuppusamy vs. Sri Vembuli Amman Templesituated at Long Bazaar Vellore, rep. by its Executive Officer]An excerpt from it would run thus:"20. When the lease is from month to month, thedeeming provision of Sec.106 T.P. Act cannot be invoked.In JT 1995 (7) SC 105, [Shri Janki Devi Bhagat Trust, AgraVs. Ram Swarup Jain (dead by Lrs.], the Supreme Court hasheld::"In the present case there is a clear finding tothe effect that the lease in question was not from yearto year or for a period exceeding one year. therefore,even though he lease may be for a manufacturingpurpose, since the lease was not from year to year, sixmonths' notice was not required. A manufacturing leasewhich is not from year to year does not require sixmonths' notice of termination. It will fall in thesecond half of Sec.106, requiring fifteen days' noticeof termination. A lease from month to month or a leaseother than a lease from year to year is terminable byfifteen days' notice. Hence the notice in the presentcase is valid notice to quit. The High Court, havingcome to the conclusion that the lease was not for aperiod exceeding one year, and was not a lease fromyear to year erred in holding that six months' noticeto quit was required. Such a notice is required,provided there is no contract to the contrary, onlywhen a manufacturing lease is, or is deemed to be, fromyear to year. This not being the case, the lease isterminable by fifteen days' notice even if the lease isa manufacturing lease."Considering the factual aspects involved in this case, from the aboveview point of the judgments cited supra, it is palpably andpellucidly clear that the lease agreement for five years turned outto be invalid as it was not a registered one. In such a case, as perthe decisions cited supra, the plaintiff cannot rely upon the deemingprovisions of Section 106 of T.P. Act and insist for six monthsnotice. https://hcservices.ecourts.gov.in/hcservices/

15. The learned Senior Counsel for the defendant would submitthat as per Ex.A3, no 15 days notice could be presumed and that tooin the absence of any specification about the number of days at allin Ex.A3; and that the curative provision of the amended Section 106of T.P. Act cannot be pressed into service by the plaintiff.16. The learned Senior counsel for the defendant cited thefollowing decisions:(1) AIR 1998 M.P. 78 [Smt. Meenkash Jain v. State of MadhyaPradesh and others]An excerpt from it would run thus:"11. ...... Moreover, it is settled that evenwhere the leasehold provides for forfeiture, in case ofassignment by the lessee, there can be no forfeiture andautomatic resumption by the lessor without notice to thelessee determining lease. The breach of condition ofthe lease only makes the lease voidable. Therefore,forfeiture is not complete unless and until the lessorgives a notice to the lessee that he wish to exercisehis option to determine the lease. The various HighCourts as also the Apex Court have long accepted theprinciple of law in this regard.(2) AIR 2002 Calcutta 144 [Union Bank of India vs. VithalbhaiPvt. Ltd.]An excerpt from it would run thus:"55. Being faced with this difficulty, the learnedCounsel for the respondent urged that the cause of hisclient arises out of forfeiture under Clause (g)(2) ofSection 111 of the Transfer of Property Act. But thefacts here are otherwise. The plaint case is based onClause (a) of Section 111 of the Transfer of Property Actwhich lays down that a lease of immovable propertydetermines by efflux of the time limited thereby. So faras Clause (g) of the same section is concerned, it isprovided therein that a lease of immovable propertydetermines by forfeiture, that is to say, in a case wherethe lessee renounces his character as such by setting upa title in a third person or by claiming title inhimself. This position is not present in the facts andcircumstances of the instant case because the plaintiffdid not ever make out a case of forfeiture. Apart fromthat there is a notice in writing by the lessor to thelessee of his intention to determine the lease. This is https://hcservices.ecourts.gov.in/hcservices/ clear (in) Clause (g) of Section 111 of the Transfer ofProperty Act itself. In the instant case, there isneither any notice, nor any intention to forfeit thelease nor does there exist any other fact so that Clause(g) may be attracted. This argument is, therefore,without any merit and is rejected."Those decisions are cited to insist upon the importance oftermination notice.17. In view of the decisions of the Hon'ble Supreme Court andthis Court, those two decisions cited are not germane for decidingthe lis.18. At this juncture, I would like to refer to the objects andreasons and the raison d'etre of the Transfer of Property (Amendment)Act, 2002 and it is quite obvious and axiomatic that before suchamendment of Section 106 of T.P. Act, a huge number of cases weredismissed on the sole ground that proper termination notice was notgiven as they were short of a few days in terminating the tenancy ascontemplated in the then existed Section 106 of T.P.Act and in orderto cure such ills, the Amendment Act came into vogue.19. Applying the principle of 'Bonam Partem' as well as the'golden rule' of interpretation, if the matter is viewed, it isglaringly clear that once again this Court throwing to winds the verypurpose of the amendment Act should not decide otherwise simplybecause there is no indication about the number of days within whichthe tenant should vacate the premises.20. A bare perusal of Ex.A3 and more specifically paragraphs 7and 8 therein as extracted supra would indicate and exemplify thatthe plaintiff for the second time after earlier terminating thetenancy as per Ex.A2 granted time for paying the arrears immediatelyand in the absence of the same, the plaintiff expressed his desire totake steps to evict the defendant. Admittedly in this case,subsequent to such notice and before the filing of the suit, thearrears were not paid and in such a case, the intention of theplaintiff was writ large and there is no ambiguity compelling theplaintiff to disambiguate the same by issuing any fresh notice. Ifthe contention of the defendant is accepted, it would amount tonullifying the very salient features of the amended Section 106 ofT.P.Act.21. At this juncture, I would like to refer to the famoustreatise 'Maxwell on the interpretation of Statutes 12th Edition'.An excerpt from it would run thus: https://hcservices.ecourts.gov.in/hcservices/ "The mischief rule:In Heydon's Case, in 1584, it was resolved by theBarons of the Exchequer (at p.7b) "that for the sure andtrue interpretation of all statutes in general (be theypenal or beneficial, restrictive or enlarging of thecommon law) four things are to be discerned andconsidered: (1st). What was the common law before themaking of the Act. (2nd). What was the mischief anddefect for which the common law did not provide. (3rd).What remedy the Parliament hath resolved and appointed tocure the disease of the commonwelath. And, (4th). Thetrue reason of the remedy; and then the office of all theJudges is always to make such construction as shallsuppress the mischief, and advance the remedy, and tosuppress subtle inventions and evasions for continuanceof the mischief, and pro privato commodo, and to addforce and life to the cure and remedy, according to thetrue intent of the makers of the Act, pro bono public."In 1898, Lindley M.R.said: "In order properly tointerpret any statute it is as necessary now as it waswhen Lord Coke reported Heydon's Case to consider how thelaw stood when the statute to be construed was passed,what the mischief was for which the old law did notprovide, and the remedy provided by the statute to curethat mischief." Although judges are unlikely to propoundformally in their judgements the four questions inHeydon's Case, consideration of the "mischief" or objectof the enactment is common, and will often provide thesolution to a problem of interpretation.In the well-known case of Smith v. Hughes, forexample, it was held that prostitutes who attracted theattention of passers-by from balconies or windows weresoliciting "in a street" within section 1(1) of theStreet Offences Act 1959. "For my part," said LordParker C.J. (at p.832), "I approach the matter byconsidering what is the mischief aimed at by this Act.Everybody knows that this was an Act intended to clean upthe streets, to enable people to walk along the streetswithout being molested or solicited by commonprostitutes." Viewed in that way, the precise place fromwhich a prostitute addressed her solicitations tosomebody walking in the street became irrelevant.""The golden rule:The so-called "golden rule" is really a modificationof the literal rule. It was stated in this way by Parke https://hcservices.ecourts.gov.in/hcservices/ B.: "It is a very useful rule, in the construction of astatute, to adhere to the ordinary meaning of the wordsused, and to the grammatical construction, unless that isat variance with the intention of the legislature, to becollected from the statute itself, or leads to anymanifest absurdity or repugnance, in which case thelanguage may be varied or modified, so as to avoid suchinconvenience, but no further." "If," said Brett L.J.,"the inconvenience is not only great, but what I may callan absurd inconvenience, by reading an enactment in itsordinary sense, whereas if you read it in a manner inwhich it is capable, though note its ordinary sense,there would not be any inconvenience at all, there wouldbe reason why you should not read it according to itsordinary grammatical meaning." The application of thisrule, and its limits, will be seen in the parts of thiswork devoted to construction with reference to theconsequences, and construction to avoid inconvenience andinjustice, and to prevent evasion. Here, a few recentexamples of the application of the golden rule will begiven.Construction of words "in Bonam Partem":Words are prima facie to be taken in their lawfuland rightful sense. Where an Act, for instance, gave acertain efficacy to a fine levied on land, it referredonly to a fine lawfully levied. The landlord's claim torecover arrears of rent out of goods seized in executionby the bailiff of a county court under section 160 of theCounty Courts Act 1888 depended upon whether the seizurewas lawful: if the goods did not belong to the debtor,and the seizure was consequently unlawful, the claimunder the section could not arise. A similar principlewas applied to the construction of a covenant by a tenantto pay all parliamentary taxes: it included only such ashe might lawfully pay, and not the landlord's propertytax which it would have been illegal for him to agree topay."22. Hence in such a case, if on technical grounds Ex.A3 isstruck down, it would be against the well known principles extractedsupra relating to interpretation of statutes. To the risk ofrepetition without being tautologous, I would like to point out thatthis Court is fully aware of the fact that the learned Senior Counselfor the defendant insists upon to take note of the absence ofspecification of number of days in the notice. https://hcservices.ecourts.gov.in/hcservices/

23. My discussion supra would indicate that in paragraph 7 ofEx.A3, the defendant clearly spelt that if arrears is not paidimmediately, then it amounts to termination of tenancy. It istherefore pellucidly and palpably, unequivocally and indubitablyclear that the plaintiff wanted the defendant to vacate and hand overpossession of the premises on his failure to pay the rentimmediately. As has been already highlighted supra, the suit wasfiled long after 15 days, assessing the time limit from any standardand as such, I could see no reason to disregard Ex.A3 as a validnotice of termination of tenancy. Accordingly, the substantialquestion of law is decided to the effect that Ex.A3 is the validtermination notice.24. The learned Senior Counsel for the plaintiff would point outthat no sympathy could be shown towards the defendant, as even thoughstay was obtained by him in this case subject to to the condition todeposit Rs.10,00,000/- (Rupees ten lakhs only) of arrears of rent inthe lower Court, no such amount was deposited and furthermore, as ondate, huge arrears running to several lakhs are there. Be that as itmay, the Second Appeal is disposed of purely on merits by decidingthe substantial question of law framed by this Court. As such, Icould see no merit in the Second Appeal and it is dismissed. Nocosts. Consequently connected miscellaneous petition is closed.Sd/-Asst. Registrar./true copy/Sub Asst. Registrar.gmsTo1.Additional District Judge,Fast Track Court No.I, Chengalpattu.2.Additional Subordinate Judge at Chengalpattu.Copy to : The Section Officer, V.R.Section, High Court, Madras.+ 1 CC to Mr.C.Jagadish, Advocate,SR.16938S.A.No.1714 of 2008CK(CO)EM/29.4