# CALCUTTA CREDIT CORP v. HAPPY HOMES (Shah, J.) 21'

- **Citation:** [1968] 2 S.C.R. 20
- **Court:** Supreme Court of India
- **Decided:** 1967-10-23
- **Case number:** Civil Appeal 'No. 71 of 1965
- **Bench:** J. C. Shah, S. M. Sikri A:'-Id ]. M. Shelat
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/calcutta-credit-corp-v-happy-homes-shah-j-21-4309
- **Pages:** 13

## Headnote

B
'1't•11<111cy-lf notice 10 tenninalt· ft•nancv cc11i be wi1ltdrah·n
without
cu11Je11t oj othf!r party.
'
Transfl'r of Property Act, S.s.
106.
111,
l 13-Notice not i11Gccord-
.a11ce H:ith s. 106--Acct:pted by uthcr party and acted upon-If c,t]cctil·c-
"Yl?t:tlicr te11e111cy 011/)' dl·ten11iTzed n-ht•11
po.~:rt>ssion given up.
We.H Benf!a/ Pre111ises Rent ('ontro/ (Tt•111pnrary Prov1\ions) Act 17
·Of 1950, .r.r. 2( 11 ), 12 and 11-1/ exprcs<;iu11 'ft'lltlll,. includes 'statuff)ry
1e11ant'-Whc1lier /le can sub/er.
Hy a lca~e commencing from January l, 1939, for I:! years, a build·
ing in {'.alcutta \l;as let to AB and under the tcrm'i of the lease, subletting
~.1r parring v.·ilh
poss~~-sion \\'ithout the prcviou" con~cnc of the landlord
v.:as prohibited.
After the expiry of the period of 1hc lease, AB continu·
cd in possession hut on August 12, 1953, ser\ 1.'J a notice in v.·riting upon
th~ landlord of their intention to vac;1tc the prcmi:-i:e.., ··on August 31, 1953
'1t 3.30 r.M."
By a suhsoquent lcl!cr on August ~6. 1953, AB informed
the landlord tha1 they did nol intend to vac.:alc the premi'jes on Auguc;t 3 t
.;:1s originally intimated, and that 1heir e;irlier notice be tre;1ted as cancelled.
/\lthough. in reply the landlord refused 10 agree to the 1A·i1hdr;1~·al of the
notice ,<;taring that he had already arranged to let the pren1iscs 10 another
person, AB continued in po!>-;ession and on \fay 7, 19)4 ~uhle1 a part of
the premises to the respondent.
'fhc landlord thereafter instituted 3. suit
for ~jcc11nent tigainst AB v.·hich v.·as settled on ~1arch :!8, 1955 by a consent
decree v.·hereupon AB handt!d over possc-;..,ion to the landlord of the por·
tion of the premises in their ov.n occup<1tion.
'fhc landlord then sued the
n.~pondcnt for a decree for posses!iion ot the premises and mcsne profit'i
and a Single Judge of the High ('curt decreed !he JanJJord\ claim. The
Divi"Sion Bench aJlo\vcJ lhe :i.ppcal and dismissed the lanJlorJ\ claim.
HELD : The appeal must be allo"cd and the decree pa<Scd hy
the
TriaJ C,ourt restored.
(i) On the expira1ion of the period of notice <lated August 12. 1951.
the tenancy of AB stood determined.
()nee a notice is served detcrn1ining the ten<1ncy or showing :tn intention 10 4uit on the expiry of the period
of notice, the tenancy b at an end. unh:~s IA·irh the consent of the parry
t1.) "°·horn the notice is gi ... cn, 1hc tenancy is agreed to be treated as.suh-
;.,/:,ting.
124Cl
Tayh·11r v. U'ildin, ( 1867-68) L.R. 3 Fx. (\1scs 303; referred to.
(ii) A notice \\hich docs net con1ply \\ith the rc4uircmcnts of s. 106
01 the ·rran.;fer of Property Act in th;H it docs not expire at !he end of
the month of the tenancy, or the end of the year of the tcn;1ncy. as
the
ca!>e mav he. l)r of v.·hich 1hc dur;1tion is shorler than the Juralion con1cmpl:1tc~I by s. 106. may srill be accrptcd hy the party served \\·i1h
the
nolic.:c; and if !hat p~rty acccpis anJ Jct<; upon ii, 1hc p;irty serving
the
rhlliCl' \\ill he cstorpcd from denying ils validily.
The l.1nJlorJ's refusal
to agree to the \\'ithJra\\·al of the notice since he h3d ;tlrc•1Jy ;igrecd
Ill
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CALCUTTA CREDIT CORP. V. HAPPY HOMES (Shah, J.) 21'
lea.•e the premises to another person from September 1, dearly showed'
that the offer to terminate the tenancy on August 31, 1953 was accepted
by him and he had acted upon that offer.
The tenancy was therefore determined at 3.30 P.M. on August 31, 1953 on acceptance by the landlord
of the notice dated August 12, 1953_ [25A-C; Fl
There was no force in the contention
that in order to determine
a
tenancy under the Transfer of Property Act at the instance of the tenant,
there must he actual delivery of the possession.
That contention is contra[\ to the plain terms of s. 111 (h) of the Act.
[25H]
(iii) Consid.ered in the light of the scheme and object of the Act, -the
expression 'tenant' in cl. (c) of s. 12(1) or ins. 13(2) must mean a contractual tenant alon-2 and not a statutor

## Text

THE CALCUTIA CREDIT CORPORATION LTD., & A:NR.
A
I'.
HAPPY HOMES (P) LTD.
October 23, 1967
[J. C. SHAH, S. M. SIKRI A:'-ID ]. M. SHELAT, JJ.)
B
'1't•11<111cy-lf notice 10 tenninalt· ft•nancv cc11i be wi1ltdrah·n
without
cu11Je11t oj othf!r party.
'
Transfl'r of Property Act, S.s.
106.
111,
l 13-Notice not i11Gccord-
.a11ce H:ith s. 106--Acct:pted by uthcr party and acted upon-If c,t]cctil·c-
"Yl?t:tlicr te11e111cy 011/)' dl·ten11iTzed n-ht•11
po.~:rt>ssion given up.
We.H Benf!a/ Pre111ises Rent ('ontro/ (Tt•111pnrary Prov1\ions) Act 17
·Of 1950, .r.r. 2( 11 ), 12 and 11-1/ exprcs<;iu11 'ft'lltlll,. includes 'statuff)ry
1e11ant'-Whc1lier /le can sub/er.
Hy a lca~e commencing from January l, 1939, for I:! years, a build·
ing in {'.alcutta \l;as let to AB and under the tcrm'i of the lease, subletting
~.1r parring v.·ilh
poss~~-sion \\'ithout the prcviou" con~cnc of the landlord
v.:as prohibited.
After the expiry of the period of 1hc lease, AB continu·
cd in possession hut on August 12, 1953, ser\ 1.'J a notice in v.·riting upon
th~ landlord of their intention to vac;1tc the prcmi:-i:e.., ··on August 31, 1953
'1t 3.30 r.M."
By a suhsoquent lcl!cr on August ~6. 1953, AB informed
the landlord tha1 they did nol intend to vac.:alc the premi'jes on Auguc;t 3 t
.;:1s originally intimated, and that 1heir e;irlier notice be tre;1ted as cancelled.
/\lthough. in reply the landlord refused 10 agree to the 1A·i1hdr;1~·al of the
notice ,<;taring that he had already arranged to let the pren1iscs 10 another
person, AB continued in po!>-;ession and on \fay 7, 19)4 ~uhle1 a part of
the premises to the respondent.
'fhc landlord thereafter instituted 3. suit
for ~jcc11nent tigainst AB v.·hich v.·as settled on ~1arch :!8, 1955 by a consent
decree v.·hereupon AB handt!d over possc-;..,ion to the landlord of the por·
tion of the premises in their ov.n occup<1tion.
'fhc landlord then sued the
n.~pondcnt for a decree for posses!iion ot the premises and mcsne profit'i
and a Single Judge of the High ('curt decreed !he JanJJord\ claim. The
Divi"Sion Bench aJlo\vcJ lhe :i.ppcal and dismissed the lanJlorJ\ claim.
HELD : The appeal must be allo"cd and the decree pa<Scd hy
the
TriaJ C,ourt restored.
(i) On the expira1ion of the period of notice <lated August 12. 1951.
the tenancy of AB stood determined.
()nee a notice is served detcrn1ining the ten<1ncy or showing :tn intention 10 4uit on the expiry of the period
of notice, the tenancy b at an end. unh:~s IA·irh the consent of the parry
t1.) "°·horn the notice is gi ... cn, 1hc tenancy is agreed to be treated as.suh-
;.,/:,ting.
124Cl
Tayh·11r v. U'ildin, ( 1867-68) L.R. 3 Fx. (\1scs 303; referred to.
(ii) A notice \\hich docs net con1ply \\ith the rc4uircmcnts of s. 106
01 the ·rran.;fer of Property Act in th;H it docs not expire at !he end of
the month of the tenancy, or the end of the year of the tcn;1ncy. as
the
ca!>e mav he. l)r of v.·hich 1hc dur;1tion is shorler than the Juralion con1cmpl:1tc~I by s. 106. may srill be accrptcd hy the party served \\·i1h
the
nolic.:c; and if !hat p~rty acccpis anJ Jct<; upon ii, 1hc p;irty serving
the
rhlliCl' \\ill he cstorpcd from denying ils validily.
The l.1nJlorJ's refusal
to agree to the \\'ithJra\\·al of the notice since he h3d ;tlrc•1Jy ;igrecd
Ill
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CALCUTTA CREDIT CORP. V. HAPPY HOMES (Shah, J.) 21'
lea.•e the premises to another person from September 1, dearly showed'
that the offer to terminate the tenancy on August 31, 1953 was accepted
by him and he had acted upon that offer.
The tenancy was therefore determined at 3.30 P.M. on August 31, 1953 on acceptance by the landlord
of the notice dated August 12, 1953_ [25A-C; Fl
There was no force in the contention
that in order to determine
a
tenancy under the Transfer of Property Act at the instance of the tenant,
there must he actual delivery of the possession.
That contention is contra[\ to the plain terms of s. 111 (h) of the Act.
[25H]
(iii) Consid.ered in the light of the scheme and object of the Act, -the
expression 'tenant' in cl. (c) of s. 12(1) or ins. 13(2) must mean a contractual tenant alon-2 and not a statutory tenant.
The
definition in'.
s. 2( 11) of the expr.ession 'tenant' includes a statutory tenant, but the defic
nition docs not apply if there is anything repugnant in the subject or context.
A stututory tenant has no interest or estate in the premises occupied
by him. and it cannot be said that the Legislatu·re, without making an express provision to that effect, intended to invest him with power to induct
into the -premises in his occupation a person. who
would be entitled to
claim t,he right and interest of a contractual tenant. [31F, Gl
A11a11c/ Niva., (Private) Ltd. v. Anandji Kalyanjl Pedhi & Ors., [1964]'
4 S.C. R. 892; Solomon v. Orwell, [19541 I All E.R. 847 Krishna Prosad
Bose v. S111t. 1Sarajubo/a Dassi and Anr., A.I.R. 1961 Cal. 505; referred
to.
Indra Kumar Karnani v. Atul Chandra
Patitundi & Anr.,
[1965].
3 S.C.R. 329; distinguished,
CIVIL APPELLATE JURISDICTION : Civil Appeal 'No. 71 of
1965.
Appeal from the judgment and decree dated February 1, 1962:
of the Calcutta High Court in Appeal No. 65 of 1959.
T. P. Das, M. G. Poddar and V. N. Poddar, for the appellants ..
A. N. Sinha and S. N. Mukherjee, for the respondents.
The Judgment of the Court was delivered by
Shah, J.
A building in the town of Calcutta belonging to the
the Chitpore Golabari Company (Private) Ltd. was let out under
:'t written lease for a period of twelve years commencing from
January !, 1939, to Messrs Allen Berry & Co. Ltd.-hereinafter·
called 'Allen Berry'. Under the terms of the lease sub-letting or
parting with the possession of the demised premises or any part
thereof by the tenants withcut the previous consent in writing of
the landlord was expressly prohibited.
After the expiry of the
period Allen Berry continued to hold over the premises.
On
August 12, 1953 Allen Berry served a notice in writing upon
the landlord intimating their intention to vacate the premises "on
August 31., 1953, at 3-30 P.M." and requested the landlord to
arrange to take delivery of possession. By letter dated August 26,
l 953, Allen Berry informed the landlord that they did not intend
to vacate the premises on August 31, 1953, as originally intimated
22
SUPREME COURT REPORTS
[1968] 2 S.C.R.
or at all, and that the notice dated August 12 , 1953, be treated
as cancelled.
By letter dated August 28, 1953, attorney of the
fandlord mformed Allen Berry that the earlier· notice dated August
12, 1953, could not be withdrawn except by mutual consent, and
since the landlord had agreed to lease the premises to Messrs. Dunlop Rubber Co. (India) Ltd. with effect from September J, 195:1,
the landlord was unable to give his consent to such withdrawal,
and that it would insist upon Allen Berry vacating the premise'
as already intimated. Allen Berry addressed a letter to the landlord on September 14, 1953, intimating that they were holding
.over the premises on the expiry of the lease "according to the
provisions of the Rent Control Act".
On February 20, 1954,
the landlord called upon Allen Berry to vac•lle and deliver possession of "the premises on the expiry of March 31, 1954", Allen
Berry failed to carry out the requisition, and on May 7, 1954,
they sub-Jct a part of the groun~ floor m~asuring. approxi1:1ate!y
2100 sq. ft. to Happy Homes (f>) Ltd.-respondent in this appeal.
The landlord then instituted a suit against Allen Bcrrv cla;ming a decree in ejectment in respect of the demised premises and
for mesne profits and other reliefs.
This suit was scttkd on
M;irch 28, 1955, and a consent decree was passed.
The important recitals in lhc decree were that ( I ) Allen Berry had sUJ"
rendered the tenancy hy nntice dated August 12, 195'.I: !2) that
\hey had hander over possession of the portion of the prcrni,cs
in their oci:upation to the landlord: (3) that the landlord will be
at liherty either to retain the sub-tenant or to eject him; ;ind
( 4) that the sub-tenancy had heen created without the >:no-.'-
Jcdge and consent of the landlord.
The landlord then sued Messrs H<1ppy Homes (Pl Ltd.--
hcreinafter c;illed 'the respondcnt'-in the High Court of Calcutta for a decree for possession of the premises in its occupation and for rnesne profits. The suit was resisted by the respondent principally on two grounds : ( i) that the tenancy of Allen
Berry was not detern1ined before the sub-letting in their favour;
and (ii) that even if it be held that the tenancy of Allen Berry was
-determined before May 7, 1954, by virtue of tl1e provisions of the
West Bengal Rent Control (Temporary Provisions) Act, 1950,
·the respondent became a direct tenant of the landlord and was
entitled to the benefits of that Act,
S. P. Mitra, J., decreed the claim of the landlord for possession of the premises in the occupation of ihe respondent and for
·mesne profits at the rate of Rs. 495/- per month from March 1,
1955 till delivery of possession.
During the pendency of the appeal against the decree passed
hy S. P. Mitra, J,, the landlord transferred the premises to Messrs
Calcutta Credit Corporation Ltd. The landlord and the trans-
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CALCUTTA CREDIT CORP. V. HAPPY HOMES (Shah, J.)
23
feree will collectively be referred to hereinafter as "the landlords".
A Division Bench of· the High Court reversed the decree passed
by S. P. Mitra, J., and ordered that the claim of the landlords be
dismissed.
Whether the tenancy of Allen Berry stood determined by the
notice dated August 12, 1953, may first be considered.
~Hen
Berry were tenants holding over in respect of the demised premises
after the expiry of the period of the original lease. By their notice
dated August 12, 1953, they intimated their intention to vacate
the premises on August 31, 1953, at 3-30 P.M.
They thereafter
withdrew this intimation by letter dated August 25, 1953. The
landlord did not agree to the withdrawal of the notice dated
August 12, 1953, and insisted that possession of the demised premises be delivered. By cl. (h) of s. 111 of the Transfer of Property Act, 1882, a lease of immovable property is determined on
the expiration of a notice to determine the lease, or to quit, or
of intention to quit, the property leased, duly given by one party
to the other. It was urged on behalf of the landlord that the
notice of intention to quit the property leased and to determine
the lease given by the tenant to the landlord could not be withdrawn, and the relation of landlord and tenant may be restored
only if by mutual agreement between the landlord and tenant a
fresh tenancy was created. Reliance in support of this contention
was placed upon the observations made in Foa's General Law of
Lundlord & Tenant, 8th Edn., at p. 613 :
"A notice to quit cannot be "waived" : for once a
valid notice is given, the tenancy will inevitably be determined upon its expiration. But though the parties cannot waive the notice, they may nullify its operation as to
quitting, by agreeing upon a. new tenancy, whether on
the terms of the former or not, to commence from the
time of its expiration.";
and upon similar observations in Woodfall on Landlord and
Tenant, Vol. I, 26th Edn., Art. 2114, at p. 973; and upon the
judgment of the Court of Exchequer in Tayleur v. Wildin(').
Counsel for the respondent contended that the rights and obligations of the parties are governed by the provisions contained in
s. 113 of the Transfer of Property Act, and that it is open to a
tenant to withdraw the notice of intention to quit before the expiry
of the period thereof.
Counsel also contended that the tenancy
was not determined, because the notice served by Allen Berry
was not a notice "duly given" within the meaning of s. 111 of
the Transfer of Property Act.
Section 113 of the Transfer of Property Act provides :
(I) (IF67-68) L. R. 3 Ex. Cases J.19.
SUPREMB COURT -REPORTS
[1968] 2 S.C.R.
"A notice under section 111, clause (h), is waived,
with the .ciqiress or implied consent of the person to
whom It 1s given, by any act on the part of the person
giving it showing an intention to treat the lease as
subsisting."
Clearly s. 113 contemplates waiver of the notice by any. act on
the part of the person giving it, if such an act shows an intention
to treat the lease as subsisting and the other party gives his
consent-express or implied thereto. The law under the Transfer
of Property AGt on the question in hand is not different
from
the law in England.
Once a notice is served determining the
tenancy .or showing an intention to quit on the expiry of the
period of the notice, the tenancy is at an end, unless with the
consent of the other party to whom the notice is given the tenancy
is agreed to be treated as subsisting. It was held in Tay/cur v.
Wildin( 1) that a notice determining a tenancy cannot be withdrawn.
fn Tayleur v. Wildi11( 1 ) an annual tenancy of a farm
under a written lease commencing on Lady Day, i.e .. March 25,
was determined by a notice by which the landlord called upon
the tenant to quit the farm at the expiration of the current year\
tenancy.
Before the expiry of the year of tenancy, the arrears
of rent were paid up by the tenant, and thr notice was withdrawn
and the tenant continued in occupation of the farm under the
terms of the original agreement.
It was held by the Court of
Exchequer that the tenancy was determined by the notice to quit,
and a surety for payment of rent under the original lease was 1101
liable for rent falling due after the expiry of the notice.
Kelly
C. B .. observed that whether the notice is given by the landlord
or the tenant. the party to whom it is given is entitled to insist
upon it. and it cannot he withdrawn without the consent of both.
The consent of the parties makes a new agreement. and the rent
became due under a new agreement.
In our judgment. that
principle applies to the law of landlord & tenant in India. Therefore on the expiration of the period of notice dated August 12.
I 953, the tenancy of Allen Berry stood determined.
But. it was contended. the notice intimating an intention to
quit at 3-30 P.M. on August 31. 1953. was not a notic~ "duly
given" within the meaning of s. 111 (h) of the Transfer of Property Act.
ft is not necessary to decide for the purpose .of this
case whether the month of the tenancy of Allen Berry expired on
the midnight of the first day of every calendar month, for. in our
judgment. a notice which is defective may still. deter~nc the
tenancy, if it is accepted by the landlord.
A nouce which complies with the requirements of s. 106 of the Transfer of Properly
Act operates to tenninate the tenancy. whether or not the p3rtv
(I) (1867-681 L.R. 3 Ex. Cam 303.
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CALCUTTA CREDIT CORP. V. HAPPY HOMES (Shah, J.)
25
served with the notice assents thereto.
A notice which does not
comply with the requirements of s. 106 of the Transfer of Property Act in that it does not expire with the end of the month cf
the tenancy, or the end of the year of the tenancy, as the ·Case
nay be, or of which the duration is shorter than the duration conemplated bys. 106, may still be accepted by the party served with
the notice and if that party accepts and acts upon it, the party
serving the notice will be estopped from denying its validity. The
defect in the notice served by one party may undoubtedly be
relied upon by the other party and he may plead that the tenancy
does not stand determined but after the notice is accepted by the
other party who acts upon it, the party serving the notice cannot
contend that the notice served by him was defective, and on that
account the tenancy was not determined.. The reason of the rule
is clear. A tenancy is determined by service or the notice in the
manner prescribed by s. 11 L(h) read with s. 106 of the Transfer
of Property Act. If the notice is duly given, the tenancy stands
determined on the expiry of the period of the tenancy. Even if
the party served with the notice does not assent thereto, the notice
takes effect.
If the notice is defective, it does not operate to
terminate the tenancy by force of the statute. But a tenancy is
founded iq contract, and it is always open to the parties thereto
to agree that the tenancy shall be determined otherwise than by
notice served in the manner provided by s. 106 of the Transfer
of Property Act, or by a notice of a duration shorter than the
period provided by the Act. If the parties so agree, the tenancy
will come to an end.
The landlord according to the t.;rms of the agreement by its
letter dated August 28, 1953, informed Allen Berry that it did
not agree to the withdrawal of the notice, since it had already
agreed to lease out the premises to Messrs Dunlop Rubber Co.
(India) Ltd. with effect from September l, 1953. The content'
of the letter clearly prove, in the absence of any evidence to the
contrary, that the offer to terminate the tenancy on August 31 .
1953, was accepted by the landlord and the landford had act~d
upon that offer.
The tenancy stood detepnined as proposed by
Allen Berry,
Allen Berry could not thereafter claim, in the
absence of a fresh agreement, that there was a subsisting contractual tenancy.
We are unable to agree with counsel for the respondent that
in order to determine a tenancy under the Transfer of Property
Act at the instance of a tenant.
There must be actual delivery
of possession before the tenancy is effectively determined. That
contention is contrary to the plain terms of s. 111 ~h) of the
Transfer of Property Act. We are therefore of the opinion that
by virtue of the notice dated August 12, 1953,· and acceptance
LIOSv;pCl/68-3
26
SUPREME COURT REPORTS
(1968) 2 S.C.R.
thereof by the landlord, the tenancy of Allen Berry was determined
A
at 3-30
P .M.
on August 31,
1953.
It is
unnecessary
in that view to consider whether the notice dated February 20,
1954, requiring Allen Berry to vacate and deliver possession of
the premises to the landlord on expiry of March 31, 1954, was a
valid notice.
Counsel for the respondent urged that granting that the
tenancy of Allen Berry stood determined by the notice dated
August 12, 1953, and acceptance thereof by the landlord, Allen
Berry acquired the status of "s!atutory tenants" and could claim
protection of the West Bengal Premises Rent Control (Temporary
Provisions) Act 17 of 1950, and were competent by virtue of
the provisions of that Act to sub-kt the premises in their occupation.
In A111111cl Nivos (Private) Ltd. v. A11a11dji Kalyanji Ped/ii &
Ors. ('). this Court in dealing with the analogous provisions of
B
c
the Bombay Rents, Hotel and Lodging House Rates Control Act,
1947, explained thci nature of the right and interest of a "statutory
D
tenant"' in premises in his occupation. It was observed at p. 90~
by the majority of the Court :
"A person remaining in occupation of the premises
let to him after the detem1ination of or expiry of the
period of the tenancy is commonly, though in law not
accurately, called a "statutory tenant". Such a person
is not a tenant al all : he has no estate or interest in the
premises occupied by him.
He has merely the protection of the statute in that he cannot be turned out so
long as he pays the standard rent and permitted increases. if any, and performs the other conditions of
the ten~mcy. His right to remain in possession after the
determination of the contractual tenancy is personal :
it is not capable of being transferred or assigned, and
devolves on his death only in the manner provided by
the statute:·
F
In So/0111011 v. Orwel/('), Denning L. J., in dealing with the provisions of the Landlord and Tenant (Rent Control) Act, 1949,
G
spoke as follows :
"When a statutory tenant sub.Jets a part of the premi,cs. he does not thereby confer any estate or interest
on the sub-tenant.
A statutory tenant has no estate
or interest himself. and he cannot carve something out
of nothing.
The sub-tenant, like the statutory tenant.
h:•5 only a personal right or privilege. The question is :
---·-
(ll (196~] 4 S.C.R. 89,,
<') [19'4] I All ER. 874.
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CALCUTTA CREDIT CORP. V. HAPPY HOMES (Shah, /.) 27
What is the position of the sub-tenant when the statu-
~ory tenancy comes to an end 7 A statutory tenancy
may, of course, come to an end without a· notice to
quit, e.g. by death (if there are no entitled relatives)
or by the delivery up of the premises to the landlord.
When the statutory tenancy come:; to an eilo, $'! subtenant's right automatically comes to an end
unless
there is some statutory protection afforded to him."
It was urged that the West Bengal Premises Rent Control
'(Temporary Provisions) Act 17 of 1950 expressly conferred
upon a statutory tenant the right to sub-let the premises and a
sub-tenant inducted into the premises by the statutory tenant
acquires, on the determination of the tenancy of the statutory
tenant, the rights of a tenant of the premises under the landlord.
Reliance in that behalf was placed upon the definition of "tenant"
in s. 2 ( 11) and ss. 12 & 13 of the Act. The expression "tenant"
is defined in s. 2 (11) as meaning any person by whom rent is,
or but for a special contract W()Uld be, payable for_ any premises,
and includes any person who is liable to be sued by· the landlord
for rent. Section 12 grants protection to tenants against eviction_
By sub-s. (1), insofar as it is material, it is provided :
"Notwithstanding anything to the contrary in any
other Act or law, no order ·or decree for the recovery
of possession of any premises shall be made by any
court in favour of the landlord against a tenant, including a tenant .whose lease has expired :
Provided that nothing in the sub-section shalJ apply
to any suit for decree for such recovery of possession,-
( a) against a tenant who· has transferred his
tenancy right in whole or in part with possession
otherwise than by sub-lease;
(b) against such transferee;
( c) against a tenant who has sub-let the whole or
a major portion of the premises for moi:e than seven
consecutive months :
Provided that if a tenant who has sublet major
portion of the premises agree to possess as a tenant th~
portion of the premises not sub-let <in payment of r::nt
fixed by the Court, the Court shall pass a decree for
ejectment ·from only a portion of the premises sub-let
and fix proportionately fair rent for the portion kept in
possession of such tenant which portion shall thenceforth constitute premises under clause (8) of section 2
and the r~t so fixed sha.11 be deemed standard rem
28
SUPREME COURT REPORTS
[1968] 2 S.C.R
fixed under section 9, and the rights and obligations
of the sub-tenants of the portion from which the tenant
is ejected shall be the same as of sub-tenants under the
provisions of section 13;
..
A
Section 12 ( 1 ) confers protection to a tenant-which expression
B
includes a tenant whose lease has expired-against eviction by
any order or decree of the Court.
But that protection is lost in
cases contemplated by els. (a) to (i) of sub-s. (I)
If a tenant ha, sub-let the premises let to him in its ennrety,
he loses the pro;ection of s. 12. If he has sub-let a major portion
·of the premises for more than seven consecutive months, he also
loses the protection. It is implicit that if the tenant has sub-let
only a small portion of the premises occupied by biJll he does
not lose the protectio11.
The tenancy continues, and the subtenant or such a small portion would, it is apprehended, be entitled to remain in possession. Where, however, a major portion
of the premises has been sub-let, if would be open tt the tenant
to offer to possess as a tenant the portion of the premises not
sub-let by liirn.
In that case the ~·tb-tenants would have the
same rights and privileges 'a!Vill'e .conferred· by s-. · 13 .. ·-Section· ·H
provides:
" ( I ) Notwithstanding anything contained in trus
Act, or in any other law for the time being in force,
if a tenant inferior to the tenant of the first degree sublets a whole or in part the premises let to him except
with the consent of the landlord and of the tenant of
a superior degree above him, such sub-lease shall not
be binding on such non-consenting landlord, or on ~uch
n·on-consenting tenant.
Explanation.-In this sub-section-
(a) "a tenant of the first degree" means a tenant
who docs not hold under any other tenant;
(b) "a tenant inferior to the tenant of the first
degree" rneans a tenant holding immediately or mediately under a tenant of the first degree;
(c) "landlord" means the landlord of a tenant of
the first degree.
( 2) Where any premises or any parl thereof have
been or has been sub-let by "a tenant of the firs:
degree" or by "a tenant inferior to a tenant of the first
degree", as defined in explanation to sub-section ( 1),
and the sub-lease is binding on the landlord of such
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CALCUTTA CREDIT CORP. V. HAPPY HOMES (S/ia/z, J.)
29'
last mentioned tenant, if the tenancy of such tenant in
either case is lawfully determined otherwise than by
virtue of a decree in a suit obtamed by the landlord
by reason of any of the grounds specified in clause (h)
of the proviso to sub-section ( 1) of ,section
l~, the
sub-lessee shall be deemed to be a tenant in respect of
such premises or· part, as the case may be, holding
directly under the landlord of the tenant whose tenancy
has been determined, on terms and conditions on which
the sub-lessee would' have held under the tenant if the
tenancy of . the latter had not been so determined :
Provided
"
We are not directly concerned in the present .:ase with sub-s. (1 )
of s. 13.
That sub-section only deals with sub-letting by a
ienant inferior to "the tenant of the first degree~. In the present case, Allen Berry were direct tenants from the landlord and
iriitially were "tenantS of the first degree". Sub-section (2) deals
with cases of sub-lettiog ·by tenants of the first degree or by a
tenant inferior to the tenant of the first degree as defined in the
E.Xplanation to sub-s. (1), and _such ·sub:Jease is binding on the
landlord of such last mentioned tenant. It is provided thereby
that if the tenancy of such tenant is lawfully dete1mined otherwise
than for personal occupation, the sub-le5see will be deemed to
E
be a tenl!llt in respect of such premises or part thereof and will
hold directly under the landlord of the tenant whose tenancy
)Jas been detennined.
Counsel for the respondent contended that a sub-tenant of
a statutory tenant is entitled to the protection of s. 13 ( 2) of Act
17 of 1950, and relied upon the following observations made
F
by this Court in Indra Kumar Karnani v. Atul Chandra Patitundi
and Anr.(') :
G
H
"Seetion 13 (2) refers to both the classes of subleases and statu; that if the sub-lease has been made by
a tenant of the first degree, tile sub-lessee shall be
deemed to be a tenant in respect of the premises
demised to him. if the tenancy of such tenant is lawfully ,
determined under the provisions of the Act otherwise
than by virtue of a decree in a suit obtained by the
landlo_rd by reason of any of the grounds specified in
cl.
( h)
of the provisi> to sub-section
(1 )
of.
section 12. ·
.
.
.
.
•
•
It follows that in the case of sub-letting by a tenant
of the first degree no consent of the. landlord to sublettiog is required as a condition precedent for acquisi-
(1) (1965] 3 S.C.R. 329.
30
SUPREME COURT REPORTS
[1968) 2 $.CR.
tion by the suh-lessee of the tenant's right but in the
case of sub-letting by a tenant inferior to tpe tenant of
the first degree the consent of the landlord an'il also of
the tenant of the superior degree above him to the subletting is necessary if the sub-lessee is to acquire the
rights of the tenant contemplated bys. 13(2)."
But the Court decided in Indra Kumar Ka.-11ani's case(') that a
covenant in the lease prohibiting a tenant from
sub-ietting,
in
respect of premises governed by the Wcsi Bengal Premises Rent
Control (Temporary Provi,ions) Act 17 of 1950 docs not pr;:-
vent the sub-tenant under a contracrual tenant from sct:ing up
the claim that he has hccome entitled under s. 13(2) of the
Act to the rights 0f the tenant in
respect of the premises or
part thereof sub-let to him.
Th.e case is nOl an authority for
the proposition that a tenant whose tenancy is determined, and
who continues to remain in occupation merely by virtue of the
protection conferred upon .him by the statute is entitled to sub-let.
Counsel then contended that the Legislature has, notwithstanding the disabilities of the statutory tenant, by express enactment conferred upon him the privilege of inducting into the
premises held by him a sub-tenant, who would be entitled to
<:)aim the rights of a contractual tenant against the landlord in
the events mentioned in the proviso to s. 12( I) (c) ands. 13(2).
Relying upon the definition of tenant in s. 2 ( n ) of the Act,
counsel argued that in s. 12 the expression "tenant" includes a
statutory tenant as well as a· 'contractual tenant, and that if a
sub-tenant in respect of a part of the premises is protected by
the .express provision contained in the pfoviSo to s. 12(l}(c),
a sub-teriant of the entire oremises whether the tenant is a contractual tenant or a statutory tenant is entitled to protection of
the Act.
According to counsel ss. 12 ( 1 ) ( c) proviso and 13 (2)
are parts of a single scheme, and the expression 'tenant' in both
the sections includes a statutory tenant, and sub-teiiants inducted
by the statutory tenants in the premises are entitled to the protection of the Act.
Reliance in support of this contention was
placed upon a Full Bench judgment of the Calcutta High Court
in Krishna Prasad Bose v. Smt. Sarajuba/a Dassi and Anr.( 2 )
wherein it was held that a tenant under the Act includes an extenant, that is, a tenant whose contractual tenancy has come 10
an end, but who is still in possession (occupation)-actual or
constructivc--of ;he premises; and such a tenant who continues
in possession by virtue of protection against eviction under the
West Bengal Premises Rent Control (Temporary Provisions) Act,
1950, is entitled to sub-let the premises and the sub-tenant may
claim. the benefit and protection of s. 13(2).
(I) p965] 3 S.C.R J~9.
(2) A.J.R. 1961 Cel
~05.
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CALCUTTA CREDIT CORP. V.• HAPPY HOMES (Shah, J.)
31
We are unable to agree with the contention rais~d by counsel
for the respondent.
In our view, since' a statutory tenant has
merely a personal right to protect his possession, and has no
estate or interest in the premises occupied by him, he cannot convey an estate or interest which he does not possess. A statutory
tenant by parting with possession forieits the protection of th~
Act, and unless the statute expressly 'provides or clearly implies
otherwise, the person inducted ny him cannot claim the protection of the Act. In our judgment, cl. (c) of s. 12(1) applies
only to a case in which the tenant has an interest in the estate
which he could sub-let.
Similarly, s. 13 contemplates a case iu
which a contractual tenant has sub-let the premises. If it be
held that the expression 'tenant' in s. 13 (2) and in cl. ( c) of
s. 12(1) includes a statutory tenant, ati es~ate or an interest in
the demised premises would be conferred by him upon a tramferee which the tenant himself does not possess, and that a tenant
who has acted contrary to the provisions of els. (m), (o) & (p)
of s. 108 of the Transfer of Property Act, or has used the property for immoral or illegal purposes, or has committed acts cf
negligence and default which may materially
deteriorate the
condition of the premises, or has otherwise been guilty of
conduct which is a nuisance or annoyance. to occupiers of adjoining or neighbouring premises including the landlord; or has failed
to pay rent exceeding two months and has thereoy incurred liability to forfeit the protection of the statute granted to him by
s. 12 ( 1) and wb,ose right has been forfeited by due notices, may
still sub-let the premises and the sub-lessee. would then be entitled
to claim the right under s. 13(2) on the detennmation of the
tenancy of the tenant.
·
Considered in the light of the scheme and object of the Act.
the expression "tenant" in cl. (c) of s. 12(1) or ins. 13(2.) must,
F ·in our judgment, mean a contractual tenant alone and not a statutory tenant. The definition in s. 2 ( 11) of the expression "tenant"
includes a statutory tenant. But the definition does not apply if
there is anything repugnant in the subject or context. A statutory
tenant has no interest or estate in the premises occupied oy him,
and we are unable to hold that the Legislatme· without 'n1al<ing
G
an express provision to that effect intended to invest him with
power to induct into the premises in his occupation a person
who would be entitled to claim the right and interest of a contractual tenant.
If the view which has appealed to the High
Court of Calcutta be accepted, a statutory tenant whose right or
occupation is determined by a notice to quit, because of conduc'.
H
which entails forfeiture of the protection of .the Act, may induct
a sub-tenant so as to defeat the claim of the landlord, and presumably a tenant sued in ejectment may also exercise that privilege, for the right if granted would enure till a decr~e in eject-
32
SUPREME CQURT REPORTS
[1968] 2 S.C.R.
mcnt is passed.
The Legislature has n~ m.ade any such exprea
provision, and no provision to _!hat effect whfch makes the right
of the landlord conferred by the Act to obtain a decree in cjectmcnt against his tenant wholly illusory may be implied.
The appeal is therefore allowed l!Ild the decree passed by
the trial Court-restored with the modification that mesne profits
will be payable from September l, 1953 at tlie rate of Rs. 495/-
pcr month till delivery of possession. The landlords will be eutitlcd to their costs in this Court and before the Division Bench
of the High Court.
R.K.P.S.
A ppca/ a/lowed.
A
B