# SMT. RAJBIR KAUR & ANR v. S. CHOKESIRI & CO

- **Citation:** [1988] Supp. 2 S.C.R. 310
- **Court:** Supreme Court of India
- **Decided:** 1988-08-09
- **Case number:** Civil Appeal No. 4077 of 1982
- **Bench:** R.S. Pathak, M.N. Venkatachaliah
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/smt-rajbir-kaur-anr-v-s-chokesiri-co-10071
- **Pages:** 29

## Headnote

Civil Procedure Code, 1908: Order 26 rule 9, Order 39 rule 7
and section 115-Commissioner appointment of-By Court-Notice to
parties not necessary if purpose of appointment would be defeated or
frustrated-Revisional Court to be reluctant to embark on independent
reassessment of evidence and supplant its own conclusion.
East Punjab Urban Rent Restriction Act, 1949: Sections 13 and
15(5)-Tenant-Eviction on ground of sub-letting-Right to enjoyment
of property to be for consideration-Concurrent finding with regard to
exclusive possession-Whether amenable to reversal in revision.
Tran>fer of Property Act, 1882: Section 105-Lease and
licence-Distinction between-Determined by the law and not by the
label parties choose to put upon it-Right to exclusive possessionDetermination of from acts done by grantee.
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The appellants had granted a lease of commercial premises in
favour of the respondent-company, who carried on the business in
clothing and textiles in the demised premises. Later, the appellants
moved an application under section 13 of the East Punjab Urban Rent
Restriction Act, 1949 seeking eviction of the respondent inter alia on the
ground that it had unauthorisedly and without the consent of the appelF
!ants inducted two sub-tenants-a tailor and an ice-cream vendor-in
two portions of the premises. The defence of the respondent in the
written statement was that the maintenance of such booths had become
a necessary adjunct of all big shops in modern shopping centres, and
that the respondent remained in the exclusive possession of the demised.
premises.
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The appellants relied particularly on the Report and evidence of
the Court-Commissioner who in his report substantially corroborated
appellants' charge of sub-letting. On the other hand, the respondent
relied upon the agreements entered into by it with the· alleged subtenants which, according to it, clearly excluded any possibility of
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sub-letting. The respondent also examined M.L. Sharma, (R. W. 3) a
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RAJBIR KAUR v. S. CHOKESIRJ & CO.
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senior architect fo Chandigarh Administration who produced the Plans
(Ext. R. 4) relating to certain alterations in the demised premises.
The Rent Controller, on an appreciation of the evidence, was
persuaded to the view that while the allegations of sub-letting in favour
of the tailor had not been established, the case of sub-letting so far as
the Ice-cream parlour was concerned had clearly been established. The
Rent Controller held that the evidence on record indicated the exclusive
possession of M.S Kwality Ice Cream. The Rent Controlier further held
that in the circumstances of the case it was also legitimate to draw an
inference, and raise a presumption that monetary consideration alone
had prompted the respondent into the transactions.
The respondent filed an appeal before the District Judge, and the
Appellate Authority affirmed the finding of the Rent Controller on the
question of sub-letting in so far as the Ice Cream Parlour was concerned. The Appellate Authority also found that even in the case of the
tailor there was sub-letting.
In Civil Revision, the High Court upon a re-appreciation of the
evidence set aside the concurrent finding of the Courts below in regard
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to the element of exclusive possession and set-aside the order of eviction
passed by the Courts below. The High Court relied on the agreements
between the respondent and the sub-tenants and held that the conditions prescribed in these documents did prima facie indicate that it was
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a case of licences and not of snb-letting. The High Court took note of the
procedural objection in regard to the appointment of the local Commissioner without notice to the respondent, and was of the view that there
were circnmstances to show that his report was not factually correct.
On behalf of the appellants it was contended that (i) the High
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Court was in error in interfering, in exercise of its revisional jurisdiction, with the concurrent finding of fact recorded hy the court

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SMT. RAJBIR KAUR & ANR.
v.
S. CHOKESIRI & CO.
AUGUST 9, 1988
[R.S. PATHAK, CJ. AND M.N. VENKATACHALIAH, J.]
Civil Procedure Code, 1908: Order 26 rule 9, Order 39 rule 7
and section 115-Commissioner appointment of-By Court-Notice to
parties not necessary if purpose of appointment would be defeated or
frustrated-Revisional Court to be reluctant to embark on independent
reassessment of evidence and supplant its own conclusion.
East Punjab Urban Rent Restriction Act, 1949: Sections 13 and
15(5)-Tenant-Eviction on ground of sub-letting-Right to enjoyment
of property to be for consideration-Concurrent finding with regard to
exclusive possession-Whether amenable to reversal in revision.
Tran>fer of Property Act, 1882: Section 105-Lease and
licence-Distinction between-Determined by the law and not by the
label parties choose to put upon it-Right to exclusive possessionDetermination of from acts done by grantee.
E
The appellants had granted a lease of commercial premises in
favour of the respondent-company, who carried on the business in
clothing and textiles in the demised premises. Later, the appellants
moved an application under section 13 of the East Punjab Urban Rent
Restriction Act, 1949 seeking eviction of the respondent inter alia on the
ground that it had unauthorisedly and without the consent of the appelF
!ants inducted two sub-tenants-a tailor and an ice-cream vendor-in
two portions of the premises. The defence of the respondent in the
written statement was that the maintenance of such booths had become
a necessary adjunct of all big shops in modern shopping centres, and
that the respondent remained in the exclusive possession of the demised.
premises.
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The appellants relied particularly on the Report and evidence of
the Court-Commissioner who in his report substantially corroborated
appellants' charge of sub-letting. On the other hand, the respondent
relied upon the agreements entered into by it with the· alleged subtenants which, according to it, clearly excluded any possibility of
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sub-letting. The respondent also examined M.L. Sharma, (R. W. 3) a
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RAJBIR KAUR v. S. CHOKESIRJ & CO.
31 l
senior architect fo Chandigarh Administration who produced the Plans
(Ext. R. 4) relating to certain alterations in the demised premises.
The Rent Controller, on an appreciation of the evidence, was
persuaded to the view that while the allegations of sub-letting in favour
of the tailor had not been established, the case of sub-letting so far as
the Ice-cream parlour was concerned had clearly been established. The
Rent Controller held that the evidence on record indicated the exclusive
possession of M.S Kwality Ice Cream. The Rent Controlier further held
that in the circumstances of the case it was also legitimate to draw an
inference, and raise a presumption that monetary consideration alone
had prompted the respondent into the transactions.
The respondent filed an appeal before the District Judge, and the
Appellate Authority affirmed the finding of the Rent Controller on the
question of sub-letting in so far as the Ice Cream Parlour was concerned. The Appellate Authority also found that even in the case of the
tailor there was sub-letting.
In Civil Revision, the High Court upon a re-appreciation of the
evidence set aside the concurrent finding of the Courts below in regard
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to the element of exclusive possession and set-aside the order of eviction
passed by the Courts below. The High Court relied on the agreements
between the respondent and the sub-tenants and held that the conditions prescribed in these documents did prima facie indicate that it was
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a case of licences and not of snb-letting. The High Court took note of the
procedural objection in regard to the appointment of the local Commissioner without notice to the respondent, and was of the view that there
were circnmstances to show that his report was not factually correct.
On behalf of the appellants it was contended that (i) the High
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Court was in error in interfering, in exercise of its revisional jurisdiction, with the concurrent finding of fact recorded hy the courts below; .
(ii) the reliance by the High Court on the evidence of R. W. 3 and Plans
(Exhibit R. 4) on the point of exclusive possession was wholly misplaced; (iii) a finding of fact which was the result purely of appreciation
of oral evidence by the trial court could not be interfered with by
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an Appellate-Court and a-fortiorari in Revision; and (iv) the view of the
High Court as to the alleged infirmity of the Court-Commissioner's
report was erroneous.
On behalf .of the respondent it was contended that (i) where a
finding of fact was shown to have been rendered infirm and vitiated by a
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[1988] Supp. 2 S.C.R.
misreading of evidence, the Revisional jurisdiction under the Act,
which was wider than that under section US C.P.C. could be invoked to
correct errors even in findings of facts; (ii) the finding of a question of
sub-tenancy being a mixed question of fact and law, this Court even on
an independent consideration of the whole matter, should not interfere
as one of the essential ingredients in the concept of a sub-lease, viz.,
the existence of monetary consideration, in the form of 'Rent', as distinct from consideration by way of services, was wholly lacking; and
(iii) the appeal should fail on the correctness of the finding of the High
Court on the lack of exclusive possession alone; and (iv) the two transactions lacked the normal and the usual indicia of tenancy and were no
more than mere personal privileges or personal-licence to occupy, and
that no interest in the property wa's transferred.
Allowing the appeal, this Court,
HELD: 1. One of the twin principal tests by which a lease
was distinguishable from the relationship created under a licence is
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the element of the right to exclusive possession involving the transfer
of an interest in the property; the other being the 'Rent' stipulated
for the grant. The grant only of the right to use the premises without
being entitled to the exclusive possession thereof operates merely as a
licence. [323B-C]
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Wood v. Leadbitter, 153 E.R. 351-354; Glenwood Lumber Co. v.
Phillips, [1904] A.C. 405-408; Associated Hotels of India v. R.N.
Kapoor, [1960] I SCR 368-383; B.M. Lall v. Dunlop Rubber Co.,
[1968] SCR 23, 27; Qudrat Ullah v. Municipal Board Bareilly, [1974] I
SCC 202, 204; Board of Revenue v. A.N. Ansari, [1976] 3 SCR 661,
665 and Khalil Ahmed Bashir Ahmed v. Tufelhussain Samasbhai
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Sarangpurwala,, JT 1987 4 S.C. 342, 346, referred to.
2. It is essential to the creation of a tenancy that the tenant be
granted the right to the enjoyment of the property and that, further, the
grant be for consideration. [323F]
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Dipak Banerjee v. Smt. Lilabati Chakroborty, 4 JT 1987 3 454,
456, referred to.
3. Exclusive possession itself is not decisive in favour of a lease
and against a mere licence, for, even the grant of exclusive possession
might turn out to be only a licence and not a lease where the grantor
H himself has no power to grant the lease. In the last analysis, the question
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whether a transaction is a lease or. a licence "turns on the operative
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intention of the parties" and there is no single litmus-test to distinguish
one from the other. [324C-D]
Cobb v. Lane, (1952] I All E.R. 1198; Merchant v. Charter,
(1977) 3 All E.R. 918, 922 and M.N. Clubwala v. Fida Hussain Sahel,
[1964) 6 SCR 642, referred to.
4. In deciding whether a grant amounts to a lease or only a
licence, regard must he had more to the substanee than the form of the
transaction. It is determined by the law and not by the label the parties
choose to put on it. To give exclusive possession, there need not be
express words to that effect; it is sufficient if the nature of the acts done
by the grantee show that he had and was intended to have the right of
exclusive possession. The fact that the agreement contained a clause
that no tenancy was to be created will not, of itself, preclude the instru·
ment from creating a lease. [327G-H; 328A]
B.M. Lall v. Dunlop Rubber Co., (1968] I SCR 23, 27, referred
to.
5. The scope of revisional jurisdiction depends on the language of
the statute conferring the revisional jurisdiction. Revisional jurisdiction
is only a part of the appellate jurisdiction and cannot be equated with
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that of a full-fledged appeal. Though the revisional power-depending
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upon the language of the provision-might be wider than revisional
power under section 151 of the Code of Civil Procedure, yet a revisional
court is not second or first appeal. [330H; 33IA) ·
6. When the findings of fact recorded by the Courts below are
supportable on the evidence on record, the revisional. Court must, in·
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deed, be reluctant to embark upon an independent re-assessment of the
evidence and to supplant a conclusion of its own, so long as the evidence
on record admitted of and supported the one reached by the Courts
below. In the circumstances, the concurrent finding as to exclusive
possession of M/s Kwality Ice-Cream 1was not amenable to reversal in
revision. (33 JB-D I
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7. The question whether the statement of the witnesses '(n regard
to what was amenable to perception by sensual experience\ as' to what
they saw and heard is acceptable or not is the area in which well-known
limitation on the powers of the appellate Court to reappreciate the
evidence falls. The appellate ·court, if it seeks to reverse those findings
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[1988] Supp. 2 S.C.R.
of fact, must give cogent reasons to demonstrate how the trial Court fell
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into an obvious error. l3J4H; 335A]
Watt v. Thomas. [1947] A.C. 484, 487,,488; Benmax v. Austin
Motor Co. Ltd., [1955] 2 W.L.R. 418, 422 and Sar,ju Pershad v.
Jwaleshwari Pratap Narain Singh, [1950] SCR 781, 783; referred
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to.
8. It is no doubt true that in the present case the order of the trial
court appointing a Commissioner did not in terms direct the parties to
appear before the Commissioner. There is this infirmity in the proceedings of the Commissioner. But it is possible to construe the power to
appoint a Commissioner to inspect the extant state and nature
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of structures as not confined to Rule 9 of Order 26 but referable to Rule
7 of Order 39 CPC where the court can dispense with prior' notice,
should it appear to the court that the very object of making of appointment of a Commissioner would be defeated and frustrated by the issue
of prior. [335E-G]
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Latchan Naidu and Anr. v. Rama Krishan Ranga Rao Bahadur
Bobbili Samasthanam, AIR 1934 Madras 548.
9. A more careful examination of the context in which M.L.
Sharma, the senior architect, who produced Ext. R. 4 was examined
E shows that Ext. R. 4 was relied upon in rebuttal of and in answer to an
altogether different ground, i.e., the ground of unauthorised structurai·
alterations and the alleged damage caused to the building thereby and
to show that the structural alterations had been authorised by the firstappellant. It is quite plain that Respondent itself did not seek to rely on
this evidence on the point of exclusive possession or lack of It. Reliance
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on the plans to take away the effect of the positive evidence on record
was not, therefore, justified. [330D-E, G]
10. In the present case, the appellants specllically pleaded "subletting". Respondent understood that pleading as to imply all the incidents of sub-letting including the element of 'Rent' and specifically
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traversed that plea by denying the existence of consideration. Parties
went to the trial with full knowledge of the ambit of the case of each
other. In the circumstances the pleadings would require to be construed
liberally. l336F J
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Ram Sarup GujJta v. Bishun Narain Inter College, AIR 1987 SC
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1242; referred to.
RAJBIR KAUR v. S. CHOKESIRI & CO. [VENKATACHAl:.IAH, J.]
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11. The burden of establishing facts and contentions which sup·
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port the party's case Is on the party who takes the risk of non·
persuasion. If at the conclusion of the trial, a party has felled to
establish these to the appropriate standard, he will lose •. Though the
burden of proof as a matter of law remains constant throughout a trial,
the evidential burden which rests initially upon a party bearing the legal
burden, shifts according to the weight of the evidence adduced by the
· party during the trial, In the circumstances of the case" the appellants
having been forced by the Courts below to have established exclusive
possession of the Ice-Cr!!am Vendor of a part of the demised premises
and the explanation of the transaction offered by the reSJll!ndent having
been found by the Courts below to be unsatisfactory and unacceptable,
it was not impermissible for the Courts 1to draw an inference, havi\)g
regard to the ordinary course or hum~n conduct, that the transaction
must have been entered into for monetary considerations, [337F-H; 338A·Bl
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 4077
of 1982.
From the Judgment and Order dated 23.8.1982 of the Punjab
and'Haryana High Court in Civil Revn. No. 2588 of 1980.
G.L. Sanghi, S.K. Mehta, M.K. Dua, S.M. Tandon, P.N. Puri;
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R. Jagannath Goulay and Aman Vochher for the Appellants.
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Dr. Y.S. Chitale, H.K. Puri and Ashok Jain for the Respon·
dents.
The Judgment of the Court was delivered·by
VENKATACHALIAH, J, This Appeal, by Special Leave, by the
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Landlord arises out of and is directed against the Judgment and Order
dated 23.8.1982 of the High Court of Punjab and Haryana in Civil
Revision Application No. 2588 of 1980, allowing the Respondent·
tenant's appeal and-in reversal of the concurrent findings of the court
below that there was an unauthorised sub-letting-dismissing' Appellant's application under Section 13 of the East Punjab Urban Rent . G
Restriction Act, 1949 (Act) for an order for grant ~f possession.
There were other grounds for eviction-one <if them that there
were unauthorised structural alterations; but having regard to the
limited scope of the proceedings before the High Court, those other
points do not survive.
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2. The two appellants-mother and son-as owners of the
commercial-premises S.C.O, No. 15, Sector 17 E, Chandigarh,
granted a lease, under deed dated 25.11.1970, in favour Mis. S.
Chokesiri & Co., respondent herein. The lease was for a term-certain
of 10 years from 1.1.1971 under the terms and on conditions partiB cularised in the Deed. Rent was initially Rs.3,000 per month subject to
certain increases stipulated in the lease-deed. Respondent carries on a
business in clothing and textiles under the name and style "Saree
Sansar" in the demised premises.
The principal ground-and the only ground that survives-on
which eviction was sought was that the respondent had, in about the
C year 1973, unauthorisedly and without the consent of the appellants,
inducted two sub-tenants in two portions of the premises who~ thereafter, carried-on their respective businesses of their own in the respective portions so sub-let. One was a tailor, a certain Banwari Lal, who
carried on his business under the name and style "Royal Star Tailors"
D and the other. Agia Ram Lamba, Proprietor of Mfs. Kwality Restaurant who established a business under the name and style "M/s. Kwality
Ice Cream" in the portion sub-let.
3. The specific defence to this charge of sub-letting and the
explanation for the admitted presence of those two other business
E establishments in the premises had better be excerpted from the
respondent's additional written statement:
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"The respondents have not sub-let any part of the
demised premises to any one. The whole of the demised
premises are in the exclusive possession of the respondents
and are being used for the purpose of carrying on the business of the respondents, namely, selling cloth and readymode garments and for purpose subsidiary and ancilliary to
the said business ..... "
"No part of the demised premises has been sub-let by the
respondent to M/s. Kwality Ice Cream or any tailors. Sector 17 is the most fashionable shopping centre of the city.
Most of the customers who frequent this shopping centre,
are ultra modern persons. It is a matter of common
knowledge that in modern shopping centres, the owners of
show-rooms, whatever the nature of their business; keep
small booths to provide cold drinks, ice-cream and paupcorns etc., to the customers, who come there with their
RAJBIR KAUR v. S. CHOKESIRI & CO. [VENKATACHALIAH, J.]
317
children and spend considerable time making purchases in
the show-rooms. The maintenance of such booths has
become a necessary adjunct of all big shops in modem
shopping centres."
"Similarly, is well-known that in order to run the business
of selling cloth efficiently, it is necessary to have a tailoring
shop on the premises. Every customer, who makes purchase of cloth in any cloth shop of any consequence wants
consult a tailor in order to know exactly the length of the
material that will be required by him for preparation of
garments of his choice and most of the customers also like
to have the garments stitched by the tailoring outfit on the
premises of the cloth shop, more especially when the
customers belong to sophisticated upper.class."
The respondent also produced and relied upon the agreements dated
13.9.1973 entered into between Respondent and the said Banwari Lal
of "Royal Star Tailors" (Ex. Mark 'B') and dated 17.9.1973 between
the Respondent and the said Agia Ram Lamba of "M/s. Kwality
Restaurant" (Ex. Mark 'A') the terms of which, according to the
respondent, clearly excluded any possibility of sub-letting.
4. Appellants, in support of their allegation of sub-letting relied,
particularly, on the Report and evidence of Sri S:K Chhabra,
Advocate-Court-Commissioner (A.W.I) who in his r~fJOrt substantially corroborated appellants' charge of sub-letting; of Ram Lal
Malhotra (A.W. -2,) and Inspector in the Enforcement Office who
spoke to the notice~· stated to have been issued by the authorities in
regard to the partitfons effected in the premises to accoμmodate the
Tailor and the Ice Cream Vendor; or Ravinder Pal Singh (A.W. 4) A
.,customer of the Ice Cream Parlour who spoke about the exclusiveness
of its possession; of Nirmal Singh (A.W. 5) who gave a similar account
respecting the tailoring establishment; of Davinder Singh (A.W. 7),
the husband of the first appellant and father of the second, who spoke
about the nature and extent of the alleged sub-letting and of the exclusiveness of the possession of the sub-tenants of the portions in their
respecilve occupation and certain other matters; and of Kul Rajinderlal
(A. W. 8) who took photographs (Exhibits AW 8/1 to 4) which are
stated to disclose that the Ice Cream Parlour was bpen late in the.nighteven after the respondent's textile business had been closed.
Mehtab Singh Gill, the second appellant, tendered evidence as
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A. W. 9. Some documents were marked and relied upon in evidence on
appellant's side.
Respondent examined, amongst others, Vijinder Kumar (R.W.
2) stated to be an attestor of Exhibits Mark 'A' and Mark 'B'; M.L.
B Shafma (R.W. 3) a Senior Architect, in Chandigarh administration
who produc~d the Plans at (Ext. R. 4); Surinder Mohan (R.W. 5) the
tailor's son; Swatantar Kumar (R.W. 6) a partner of "M/s. Kwality
Restaurant"; Parveen Jain (R.W. 7) who was examined to contradict
A.W. 8 in regard to the time at which the photographs Ext. AW 8/1 to
4 were taken; Baldev Raj (R.W. 8) the Manage.r of "M/~. Kwality
C Restaurant"; Krishan Lal (R.W. 9) an employee of "M/s. Kwality Ice
Cream" and Des Raj Jain (R.W. 10) a partnerof the respondent firm.
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say:
The relevant portions of document (Mark A) dated 17.9.1973
"(1) That 1st party will provide Softy Ice Cream Machine
along with one employee at their premises and the
whole Softy Ice Cream will be supplied by the !st part
at his own risk and costs.
(8) That both the parties can terminate the system at any
time without any notice. In that case the 1st part will
take away the machine from the premises."
The relevant recitals in the document (Mark B) dated 13.9.1973
provide:
"( 1) That the first party will do tailoring work only in the
portion, i.e., back court yard and he will keep the
employees with the prior consent of the second part
and the premises will be locked in the evening by the
second part. The possession will remain with the
second part.
(2) That the arrangement has been done as it is beneficial
to both the parties and it will boost the business of
second part and the first part be licencee in the premises and licence can be revoked ~ill only (sic) at any
time without any notice and in that case the 1st part
will remove his machine and other articles. The 2nd
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RAJBIR KAUR v. S. CHOKESIRI & CO. [VENKATACHALIAH, J.]
319
part will not liable to pay any damages."
5. The learned Rent Controller, on an appreciation of the evidence on ·the point, was persuaded to the view that, while the a\legations of sub-letting in favour of the tailor had not been established, the
case of sub-letting so·far as the "M/s. Kwality Ice Cream" was concerned, had clearly been established. It is relevant to mention here
that sometime in the year 1976 after the institution of the proceedings
the Tailor gave up his business and vacated the portion in his occupation. In about the year 1980 the Ice Cream Vendor is also stated to
have gone away. Learned Rent Controller held that the evidence on
record indicated the exclusive possession of the Kwality Ice Cream and
that in the circumstances of the cases it was also legitimate to draw an
inference, and raise a presumption, that monetary consideration alone
had prompted the respondent into the transactions. Accordingly, the
learned Rent Controller by his order dated 2.3. 1979 allowed the appellants' application and made an order granting possession.
6. The appeal preferred by the respondent before the District
Judge was unsuccessful and the order of eviction came to be upheld.
The Appellate Authority also found that even in the case of M/s.
Royal Star Tailors, there was a sub-letting. The Appellate Authority
held:
"So in the cases in hand, two exclusive portions have been
parted with for M/s. Royal Star Tailors and for M/s.
Kwality Ice Cream and the only conclusion in view of the
evidence on record could be Jhat the premises has been
sublet and the documents Mark A and Mark B, could not
be termed as licence deeds by any stretch of imagination.
Hence, so far as the finding on the ground of sub-letting is
concerned, I do not find any reason to differ with learned
Rent Controller and on this point I affirm the finding of the
Rent Controller on this part of the issue."
7. ,The High Court, by its order dated 23.8.1982, in Civil Revision Application No. 2588 of 1980 however, in exercise of its Revision
jurisdiction and upon a re-appreciation of the evidence set-aside the
concurrent-findings of the Courts-below in regard to the element of
exclusive possession and set-aside the orders of eviction passed by the
Courts-below. Consequently appellants' application for possession
was dismissed.
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In reaching this conclusion, the High Court placed reliance on
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the two documents Mark A and Mark B entered into between the
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respondent on the one hand and M/s. Kwality Restaurant and Ban-
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warilal, the Tailor, respe.ctively, on the other. The High Court
observed:
"A look at these documents goes to show that it was specifically mentioned therein that the possession of the
demised premises will remain with the petitioner-tenant
and only the work connected with the supply of Softy Ice
Cream and tailoring was allowed to be carried on. Except
for the charges for the electricity consumed no rent is payable by the third parties to the petitioner. The agreements
further envisage that the licences could be revoked at any
time without any notice. The conditions prescribed in these
documents do prima facie indicate that it was a case of
licences, and not of sub-letting."
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Referring to what it thought were certain procedural objections in
accepting the Report and the evidence of the Court-Commissioner
(A.W. 1) which had been accepted by the Courts-below, the High
Court was persuaded to this view:
"It appears that the Authorities below have given great
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importance to a report of the Local Commissioner who was
appointed during the trial for inspection of the demised
shop. It is not disputed that the order appointing the Local
Commissioner was passed by the Rent Controller ex-parte
without notice to the petitioner."
p
"In the first place, there is nothing on the record to indicate
that the petitioner was at any stage afforded an opportunity
to file objections to this report as is usually done in such
matters."
In regard to the correctness of the Report itself, the High Court
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had this observation to make:
"The Local Commissioner made a report Exhibit A-1 to
the effect that there are three separate portions on the
ground floor where the demised premises were situated and
each of these portions had a separate access. A material
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part of this report is that none of the above portion is
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RAJBIR KAUR v. S. CHOKESIRI & CO. [VENKATACHALIAH, J.]
321
approachable from inside the demised shop. If this report A
of the Local Commissioner would have been correct, there
may be something to say in favour of the land-lords on the
points of the conferment of exclusive possession of the portions to the third parties. There are, however, circumstances to show that this report is not factually correct."·
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The High Court placed reliance on certain plans said to have been
submitted for effecting certain alterations to the building which are
stated to have contained the signature of the first appellant to come to
the conclusion that, consistent with the structural dispensations
indicated in the plans, the alleged sub-tenants could not have had
exclusive possession. Ori this aspect, the High Court observed:
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"These plans were proved by M.L. Sharma, Senior
Architect (RW. 3) who testified that they bear the signatures of Rajbir Kaur respondent-landlady. In fact, their
correctness was also admitted by Devinder Singh, MukhD
liar and husband of Rajbir Kaur, landlady. These plans,
according to learned counsel for the petitioner, indicate that
after entering into the main gate of the shop, one could go
into the portion which was permitted to be used by the K wality Restaurant for supply of Softy Ice Cream. Similar is the
case with the portion occupied by the tailor. The learned
counsel for the respondents has not been able to rebut this
fact. This being so, the question of parting with exclusive
possession of any portion of the shop in favour of the two
alleged suh-tenants, does not arise."
(Emphasis Supplied)
8. The contentions of Sri G.!.. .. Sanghi, learned Senior Advocate in support of the appeal admit of being formulated thus:
(a) The High Court was in error in interfering, in exercise
of its revisional-jurisdiction, with the concurrent finding of
fact recorded by both the Courts-below as to the exclusivity
of the possession of Mis. Kwality Ice Cream of the portions
in which it was carrying on of its business. This was a pure
question of fact the concurrent findig on which was not
amendable to interference in execise of revisional powers
under the 'Act';
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(b) That reliance by the High Court on the evidence of
R. W. 3 and Plans Exhibit R. 4 to show that the structural
modifications indicated an accessibility between the main
premises and the portions in the occupation of sub-tenants
was wholly misplaced as, indeed, Exhibit R. 4 was itself
produced in a totally different context and for an altogether
different purpose, viz., to meet the ground of eviction
based on unauthorised construction and not for purposes of
rebutting exclusive-possession of the sub-tenants;
( c) That even if the Revisional jurisdiction of the High
Court admitted a re-appreciation of evidence, a finding of a
fact which was the result purely of appreciation of oral
evidence by the trial court could not be interfered with
even by an Appellate-Court and a-fortiorari in Revision;
(d) That the view of the High Court as to the alleged
infirmity of the Court-Commissioner's (A.W. !) report on
the ground that his appointment was not preceded by a
notice to the Respondent was erroneous.
9. Dr. Chitaley, learned Senior Advocate for the respondent,·
sought to support the order of the High Court contending, in the main,
that, where a finding of fact is shown to have been rendered infirm and
vitiated by a misreading of evidence and a non-consideration of material evidence, and where the inference and conclusion drawn from the
evidence is non-sequetor the Revisional jurisdiction under the 'Act'
which is wider than that under Section 115 C.P.C. could be invoked to
correct errors even in findings of facts and that, at all events, the
finding of a question of sub-tenancy being a mixed question of fact and
law, this Court, even on an independent consideration of the whole
matter, should not interfere as one of the essential ingredients in the
concept of a sub-lease, viz., the existence of monetary-consideration,
in the form 'Rent', as distinct from consideration by way of services,
was wholly lacking. Learned counsel, however, emphasized the correctness of the finding of the High Court on the lack of exclusi.vepossession, on which alone, according to the learned counsel, the
appeal should fail.
10. Such controversy as exists in the case turns solely on whether
the relationship between the Respondent on the one hand and "M/s.
Kwality Restaurant" and the "Royal Star Tailors" on the other, is one
of sub-letting. Dr. Chitaley contends that the two transactions lack the
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RAJBIR KAUR v. S. CHOKESIRI & CO. [VENKATACHALIAH, J.l
323
normal and the usual indicia of tenancy and were no more than mere
personal privileges or personal-licence to occupy; and that no interest
in the property was transferred.
This case, indeed, presents once again the recurring facets of a
familiar controversy, whether the transaction between a tenant and.
the person-alleged by the landlord-to b.e his sub-tenant is in law
really one of sub-tenancy which often resembles, and is most liable to
be confounded with, a licence. One of the twin principal tests by which
a lease is distinguishable from the relationship created under a licence
is the element of the right to exclusive possession involving the transfer
of an interest in the property; the other being the 'rent' stipulated for
the grant.
In Wood v. Leadbitter, 153 E.R. 351 at 354 Baron Alderson
emphasized the element of the transfer of interest:
"A dispensation or license properly passeth no interest,
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nor alters or transfers property in anything, but only makes
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an action lawful which without it had been unlawful."
In Glenwood Lumber Co. v. Phillips, [1904] A.C. 405 at 408 the
· distinction was pointed out thus:
"If the effect of the instrument is to give the holder an
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exclusive right of occupation of the land, though subject to
certain reservations or to a restriction of the purposes for
which it may be used, it is in law a demise of Jhe lahd
itself."
It is essential to the creation of a tenancy that the tenant be
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granted the right to the enjoyment of the property and that, further,
the grant be for consideration. While the definition of 'Lease' in Section 105 of the Transfer of Property Act, 1882, envisages the transfer
of a right to enjoy the property, on the other hand the definition of a
'Licence' under Section 52 of the Indian Easements Act, 1982, consistently with the above, excludes from its pale any transaction which
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otherwise, amounts to an "easement" or involves a transfer of an
interest in the property, which is usually involved in the case of a
transfer of right to enjoy it. These two rights, viz. easements and lease
in their very nature, are appurtenant to the property. On the other
hand, the grant only of the right to use the premises without being
entitled to the exclusive possession thereof operates merely as a
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licence. But the converse implications of this proposition need not
necessarily and always be true. Wherever there is exclusive-possession, the idea of a licence is not necessarily ruled out. English Law ·
contemplates what are called 'Possessory-Licences' which confer a
right of exclusive-possession, marking them off from the more usual
type of licences which serve to authorise acts which would otherwise
be trespasses. (See: John Dewar; "Licences and Land Law". Modern
Law Review Vol. 49 No. 6 Nov. 1986 and S. Moriarty "Licences and
Land Law: Legal principles and Public policies" 1984 100 L.Q.R. 376)
Thus exclusive possession itself is not decisive in favour of a lease and
against a mere licence, for, even the grant of exclusive-possession
might turn out to be only a licence and not a lease where the grantor
himself has no power to grant the lease. In the last analysis the question whether a transaction is a lease or a licence "turns on the operative_intention of the parties" and that there is no single, simplditmustest to distinguish one from the other. The "solution that would seem
to have been found is, as one would expect, that it must depend on the
II> intention of the parties" (See Cobb v. Lane, I 1952) 1 All E .R. 1198).
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In Merchant v. Charters, [l977] 3 All R.R. 918 at 922 (C.A.)
Lord Denning MR referred to the tests for determining whether an
occupier is a licensee or tenant thus:
"Gathering the cases together, what does it come to? What
is the test to see whether the occupier of one room in a
house is a tenant or a licensee? It does not depend on
whether he or she has exclusive possession or not. It does
not depend on whether the room is furnished or not. It
does not depend on whether the occupation is permanent
or temporary. It does not depend on the lable which the
parties put on it. All these are factors which may influence
the decision but none of them is conclusive. All the circumstances have to be worked out. Eventually the answer
depends on the nature and quality of the occupancy. Was it
intended that the occupier should have a stake in the room
or did he have only permission for himself personally to
occupy the room, whether under a contract or not, in which
case he is a licensee?"
11. In Associated Hotels of India v. R.N. Kapoor, [1960] 1 SCR
368 at 383 this Court referring to the classic distinction between a lease
ff and a licence said:
RAJBIR KAUR v. S. CHOKESIRI & CO. [VENKATACHALIAH, J.l
325
"There is a marked distinction between a lease and a
licence. Section 105 of the Transfer of Property Act defines
a lease of immovable property as a transfer of a right to
en joy such property made for a certain time in consideration for a price paid or promised. Under Section 108 of the
said Act, the lessee is entitled to be put in possession of the
property. A lease is· therefore a transfer of an interest in
land. The interest transferred is called the. leasehold
interest. The lessor parts with his right to enjoy the property during the terms of the lease, and it follows from it
that the lessee gets that right to the exclusion of the lessor."
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In B.M. Lall v. Dunlop Rubber Co., [1968] l SCR 23 at 27 the
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distinction between the two concepts was brought out:
"A lease ..... is the transfer of a right to enjoy the premises; whereas a licence is privilege to do something on the
premises which otherwise would be unlawful. ..... The
transaction is a lease, if it grants an interest in the ·land; it is
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a licence if it gives a pe·rsonal privilege with no interest in
the land ...... "
In Qudrat Ullah v. Municipal Board, Bareilly, [1974] I SCC 202
at 204 it was stated: _
" ..... If an interest in immovable property, entitling the
transferers to enjoyment, is created, it is a lease; if permission to use land without right to exclusive possession _is
alone granted, a licence ...... "
In Board of Revenue v. A.M. Ansari, [1976) 3 SCR 661 at 665 it
was again observed:
" ..... it is the creation of an interest in emmovablc property or right to possess it that distinguishes a lease from a
licence. A licence does not create an interest in the property to which it relates while a lease does. There is in other
words transfer of a right to enjoy the property in case of a
lease ...... "
In Dipak Banerjee v. Smt. Lilabati Chakroborty, 4 JT 1987 3 454
at 456 Sabyasachi Mukharji, J. observed:
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"But in order to prove tenancy or sub-tenancy two ingredients had to be established, firstly the tenant must have
exclusive right of possession or interest in the premises or
part of the premises in question and secondly that right
must in lieu of payment of some compensation or rent."
However, in regard to the second requirement of 'consideration'
for the transfer of the right to enjoy the property, it was in that case
held that though Section 105 of the Transfer of Property Act envisaged
even 'services' rendered by the lessee as a consideration for the grant,
however, under the Rent Acts, the position would be different. The
proposition was noticed thus:
"The question is, whether in the context of the provisions
of Rent Act, services can be consideration for sub-tenancy.
In other words whether in view of the provisions of the
Rent Act services can be a good or any consideration for
sub-lease is the question.
Answering, it was held:
"We are of the opinion that it cannot be"
"It is however not possible to accept that services in lieu of
the right of occupation would amount to receipt of rent
under the Rent Act to create sub-tenancy. This frustrates
and defeats the purpose of the Rent Act."
12. Again, in Khalil Ahmed Bashir Ahmed v. Tufelhussein
Samasbhai Sarangpurwala, JT 1987 4 S.C. 342 at 348 Sabyasachi
Mukharji J. observed:
"To put precisely if an interest in immovable property
entitling the transferee to enjoyment was created, it was a
lease; if permission to use land without exclusive possession was alone granted, a licence was the legal result. We
are of the opinion that this was a licence and not a lease as
we discover the intent."
13. The question is, whether in the present case, the evidence on
record justifies the inference that the tailor and the Ice-Cream-Vendor
were put in exclusive possession. Dr. Chitaley contended that the
question would require to be determined upon a proper construction
RAJBIR KAUR v. S. CHOKESIRI & CO. [VENKATACHALIAH, J.]
327
· of the deeds entered into between the parties, and that, that alone is
decisive of the matter. Indeed, learned counsel placed strong reliance
on the following observations by this Court in M. N. Clubwala v. Fida
Hussain Saheb, [1964] 6 SCR 642.
"Whether an agreement creates between the parties the
relationship of landlord and tenant or merely that of
licensor and licensee the decisive consideration is the intention of the parties. This intention has to be ascertained on a
r.onsideration of all the relevant provisions in the agreement.·-·
(Emphasis Supplied}
The proposition of Dr. Chitaley as to the conclusiveness of what
emanates from the construction of the documents, has, in this case, its
own limitations. The import significance and conclusiveness of such
documents making, or evidencing, the grants, fall to be examined in
. two distinct contexts. The dispute may arise between the very parties
to the written instrument, where on the construction of the deed one
party contends that the transaction is a 'licence' and the other that it is
a 'lease'.