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PETITIONER: D.H. MANIAR & ORS.

       Vs.

RESPONDENT: WAMAN LAXMAN KUDAV

DATE OF JUDGMENT24/08/1976

BENCH: UNTWALIA, N.L. BENCH: UNTWALIA, N.L. BHAGWATI, P.N. FAZALALI, SYED MURTAZA

CITATION:  1976 AIR 2340            1977 SCR  (1) 403  1976 SCC  (4) 118  CITATOR INFO :  RF         1988 SC 184  (5,8)  APL        1989 SC  81  (6)  RF         1991 SC1494  (13)

ACT:             Bombay  Rents Hotel and Lodging House Rates Control  Act         1947--Sec. 15A--Sec. 5(4A)--Indian Easements Act  1882--Sec.         52--62(c)--Revocation  of licence by efflux of  time--Presi-         dency  Small  Causes  Courts Act  1882--Sec.  47--Effect  of         filing of application for eviction--Meaning of licence under         a  subsisting agreement--Interpretation  of  Statutes--Prac-         tice.

HEADNOTE:             The  appellants granted a licence in respect of  certain         shop premises in Bombay to the respondent under a Leave  and         Licence Agreement which expired on 31st March 1966.   There-         after  the  appellants served a notice upon  the  respondent         calling  upon him to remove himself from the premises.   The         respondent  refused to do so.  In July 1967  the  appellants         filed  on application for eviction under Section 41  of  the         Presidency  Small Causes Court Act.  The contention  of  the         respondent  that he was a tenant was negatived by the  Small         Causes  Court, Bombay.  The respondent approached  the  High         Court under Article 227 of the Constitution.  The High Court         refused  to interfere with the finding of the  Small  Causes         Court that the respondent was a licensee and not a tenant.             The Bombay Rent Act was amended by Maharashtra Act 17 of         1973.   By the amending Act,  section 5(4A) and Section  15A         were introduced in the parent Act to confer on the licensee,         who  had  a subsisting agreement on February 1,   1973,  the         status and protection of a tenant under the Bombay Rent Act.             The respondent by an amendment took the plea of  protec-         tion  under the Maharashtra Amendment Act 17 of 1973 on  the         ground  that  he was in occupation of the  premises  on  1st         February 1973 under a subsisting agreement for licence.  The         Small Causes Court, Bombay, negatived the plea on the ground         that  there was no subsisting agreement for licence  on  the         1st of February, 1973 as there was nothing on record to show         that  after 31st March 1966 the leave and licence  agreement         between  the parties was renewed or any fresh agreement  was

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       entered into.             The  respondent filed a revision petition under  section         115 of C.P.C. in the High Court.  The High Court allowed the         revision  on the ground that the licence was not put an  end         to  by  the appellants and that in any event by  filing  the         application for eviction the appellant licensor had  granted         an implied licence to the respondent licensee to continue in         possession  till  a  decree of eviction was  passed  in  his         favour.         Allowing the appeal,             HELD:  (a) In order to get the advantage of section  15A         of  the Bombay Rent Act, the occupant must be in  occupation         of the premises as a licensee as defined in section 5(4A) on         the  1st  of February 1973. If he be such  a  licensee,  the         non-obstante  clause of section 15A(1) gives him the  status         and protection of a tenant in spite of there being  anything         to the contrary in any other law or in any contract. But  if         he is not a licensee under a subsisting agreement on the 1st         of February 1973, then he does not get the advantange of the         amended provision of the Bombay Rent Act. [407 H, 408 A]             (b)  A person continuing in possession of  the  premises         after  termination, withdrawal or revocation of the  licence         continues  to occupy it is a trespasser or as a  person  who         has  no semblance of any right to continue in occupation  of         the premises.  Such a person cannot be called a licensee  at         all. [408 B]             (c)  A person continuing in occupation of such  premises         after  revocation  of  the licence is still  liable  to  pay         compensation, or damages for their use and occupation.  [408         E]         404             (d) Filing an application under section 41 of the Presi-         dency  Small Causes Court Act may in  certain  circumstances         have  the effect of putting an end to the licence if it  was         subsisting  on  the date of its filing.   But,  that  cannot         possibly  have the effect of reviving the licence as  opined         by  the  learned Judge. Such a proposition of  law  is  both         novel and incomprehensible. [408H, 409 G]             (e) It is right that the Court should act in  consonance         with the spirit of the Maharashtra Amending Act 17 of  1973.         But  the  Court cannot and should not cast the  law  to  the         winds  or twist or stretch it to a breaking point  amounting         to almost an absurdity. [410 C]             (f)  The finding of the High Court that  the  respondent         was in occupation of the premises under a subsisting licence         was  wholly wrong and suffered from serious  infirmities  of         law and fact and deserved to be.set aside. [410 G]             [The Supreme Court is loathe to pass any harsh or unpal-         atable remarks concerning the judgment of the High Court and         ought  to  act  with restraint.   But  sometimes  constraint         outweighs  restraint and compels this Court in discharge  of         its  duty  to  make strong observations when  it  finds  the         judgment of the High Court running galore with the gross and         palpable mistakes of law almost amounting to judicial imbal-         ance in the approach to the case].

JUDGMENT:         CIVIL APPELLATE JURISDICTION: Civil Appeal No. 212 of 1976.             (From  the  Judgment and Order dated  18-2-1975  of  the         Bombay High Court in Civil Revision Appln. No. 741/74).             Soli  J. Sorabji, P.H. Parekh, Miss Manju letly and  M/s         Dharia & D.D. Kapadia’ for the appellant.             B.K.  Desai,  S.S. Khanduja and Vijay Gandotra  for  the

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       respondent.         P.H. Parekh for the Intervener.         The Judgment of the Court was delivered by             UNTWALIA,  J.  The appellants in this appeal by  special         leave  had  filed  an application under section  41  of  The         Presidency  Small  Cause Courts Act,  1882--hereinafter  re-         ferred  to  as  the S.C.C. Act, against  the  respondent  to         compel  him to quit and deliver  up  the possession  of  the         premises  in question.  The Small Cause Court made an  order         in favour’ of the appellants under section 43 of the  S.C.C.         Act.   On  the filing of an application in revision  by  the         respondent in the Bombay High Court, a learned single  Judge         of  that  Court has set aside the order of the  Small  Cause         Court   and  dismissed     the appellants’  application  for         eviction of the  respondent.  Hence  this appeal.           This Court does, as it ought to, act with restraint and is         loathe  to pass any harsh or unpalatable  remark  concerning         the   judgment  of a High Court.  But  sometimes  constraint         outweighs  restraint and compels this Court in discharge  of         its  duty to make  some  strong observations when  it  finds         the  judgment of the High Court  running galore  with  gross         and  palpable mistakes of law almost amounting  to  judicial         imbalance  in  the approach to the case.  We regret  to  say         that this is one such case.             The appellants had allowed the respondents to occupy the         shop  premises in question which are situated  outside  Swa-         deshi  Market,         405         Kalbadevi  Road in Bombay under certain agreements of  leave         and licence which were renewed from time to time.  The  last         agreement was dated April 30, 1965.  Duration of the  period         of licence mentioned in this agreement was in the  following         terms:                        "(1) This  agreement  shall  be  deemed    to                  have  commenced from 1st May 1965 and shall  remain                  in force for 11 months and will automatically  come                  to  an  end  on 31st March, 1966 on which  day  the                  Party of the  Second Part shall remove himself from                  the premises of his  own accord with all his  arti-                  cles  and belongings and in event of the  Party  of                  the Second Part not clearing out of the premises on                  the said day viz., 31st March, 1966 the parties  of                  the  First Part shall be at liberty to  remove  the                  goods and articles of the party of the Second  Part                  by themselves, by employment of labour at the  cost                  and on account of the party of the Second Part  and                  shall be entitled to stop and prevent the, Party of                  the  Second  Part from entering  the  premises  and                  making use of the same by himself or his agent."         The  respondent did not vacate and remove himself  from  the         premises  as  per the aforesaid term of the  agreement.   He         purported  to claim to be a tenant of the premises and  with         that  end in view his Advocate wrote a letter  to  appellant         No.  1 on May 23, 1966 stating  therein that the  respondent         was  a tenant of the shop  premises  and  had  remitted  the         rent  for the months of March and April,  1976.  A reply  to         the letter aforesaid of the respondent’s advocate was  given         on behalf of the appellants on June 14, 1966 refuting there-         in  the  respondent’s claim of being a tenant  of  the  shop         premises and asserting that he was a mere licensee.  It  was         also said that the said licence had automatically come to an         end on March 31, 1966 and thereafter he was "no better  than         a  trespasser".  Subsequent  correspondence followed between         the parties in which the appellants  showed  their readiness         and willingness to accept money from the respondent  by  way

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       of  compensation  for  the use and occupation  of  the  shop         premises  without prejudice to their rights and  threatening         to take legal action for getting the possession of the prem-         ises.             On the 10th July, 1967 the appellants filed an  applica-         tion  under  section 41 of the S.C.C. Act.   The  respondent         contested  that application, inter-alia, on the ground  that         he was a tenant  of  the  shop premises and was,  therefore,         protected  against  the  eviction  under The  Bombay  Rents,         Hotel  .and  Lodging  House Rates Control   Act,  1947  (for         brevity,  the Bombay Rent Act).  As per the  requirement  of         section  42A  of the S.C.C. Act, the  question  whether  the         respondent  was  a tenant of the appellants was tried  as  a         preliminary  issue  by  the Small Cause  Court,  Bombay.   A         single  Judge of that Court by his Judgment and order  dated         June  30, 1972 held  against  the respondent and found  that         he  was not a tenant of the  appellants  in respect  of  the         shop  premises.  An appeal was taken by the respondent to  a         Bench of two judges of the Small Cause Court under section         406         42A(2) of the S.C.C. Act.  By a reasoned order dated  Decem-         ber  11, 1972 the appellate Bench upheld the finding of  the         single  Judge and summarily dismissed the appeal.   The  re-         spondent  filed a  writ application in the High Court  which         after hearing the appellants was dismissed on July 3, 1973.             The Bombay Rent Act was amended by Maharashtra Act 17 of         1973.   By the amending Act, section 5(4A) and  Section  15A         were introduced in the parent Act to confer on the licensee,         who  had  a  subsisting agreement on February  1,  1973  the         status and protection of a tenant under the Bombay Rent Act.         The respondent,  thereafter, by an amendment of his  written         defence  filed in  the  Small Cause Court proceeded to  take         the  additional  plea  of  protection under Maharashtra  Act         17 of 1973.  Although the amendment was not fully and effec-         tively  allowed by the Small Cause Court Judge, the  parties         had proceeded on the footing that such a plea became  avail-         able to the respondent.             A  learned  single Judge of the Small Cause  Court  held         that  there was no subsisting agreement for licence  on  the         1st of February, 1973 as there was nothing on record to show         that after 31st March, 1966 the leave and licence  agreement         between  the parties was renewed or any fresh agreement  was         entered  into.  In that view of the matter the  Trial  Court         held  that the respondent was not entitled  to  the  protec-         tion  of the Bombay Rent Act conferred on  a   licensee   by         Maharashtra Act 17 of 1973.  The Court allowed  the   appel-         lants’ application and made an order under section 43 of the         S.C.C. Act directing the respondent to vacate and hand  over         peaceful possession of the premises to the appellants within         one  month from the  date  of the order i.e. the 11th  Octo-         ber, 1974.  This order was not appealable. Hence  respondent         filed  a revision before the High Court.  A  learned  single         Judge  of the High Court by his judgment and   order   dated         February  18,  1975  allowed the  revision  and,  as  stated         above,   set  aside the order of the Small Cause  Court  and         dismissed  the appellants’ application for eviction  of  the         respondent.             Mr.  Sorabji, learned counsel for the  appellants  after         drawing  our  attention to the relevant facts  and  the  law         involved  in the case placed the judgment of the High  Court         to  point out the glaring errors committed by it which  were         writ  large  on its face.  Mr. Desai appearing for  the  re-         spondent  made a strenuous effect to persuade us  to  uphold         the  judgment of the High Court.  But in the   circumstances         of the case he could do no better than what has been said in

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       the judgment.             Section  52  of The Indian Easements Act,  1882  defines         "licence" thus:                        "Where one person grants to another, or to  a                  definite number of other persons, a right to do, or                  continue  to do, in or upon the immovable  property                  of  the  grantor,  something which  would,  in  the                  absence of such right, be unlawful, and such  right                  does  not amount to an easement or an  interest  in                  the property, the right is called a licence."         407         It  was no longer open to debate that the respondent was   a         mere  licensee of the shop premises of which the  appellants         were  the  licensors.  Section 62(c) of  the  Easements  Act         says:                  "A license is deemed to be revoked-                         (c) where it has been granted for a  limited                  period,  or  acquired on condition  that  it  shall                  become   void  on  the performance or  non-perform-                  ance of a specified act, and the period expires, or                  the condition is fulfilled;"                  By  efflux  of time, therefore, the  licence  stood                  revoked on the 1st of April, 1966.  Yet the  licen-                  see  under  section 63 of the   Easements  Act  was                  entitled to a reasonable time to leave the property                  and  to remove his goods which he had been  allowed                  to place on such property.  In spite of being asked                  by  the appellants to do so the respondent did  not                  pay any heed.  Hence the appellants  took  recourse                  to  section  41 of the S.C.C. Act.  The  remedy  of                  section  41 is available only after the  permission                  or the licence granted to the licensee to go on the                  property  has  been withdrawn or revoked.   If  the                  occupant  of the property is not able to  show  any                  sufficient cause  then order for possession follows                  under section 43.                      We  now proceed to quote the relevant words  of                  section 5(4A) of the Bombay Rent Act:                        ""Licensee",  in respect of any  premises  or                  any   part  thereof,  means the person  who  is  in                  occupation   of  the premises or such part, as  the                  case  may  be,  under a  subsisting  agreement  for                  licence   given    for    a    licence    fee    or                  charge  ........  "                  The inclusive clauses thereafter in the  definition                  of  the  ’licensee’  do not include a  licensee  in                  occupation  of the premises whose  licence  already                  come  to  an end and in such a  case  the  occupant                  would  not be a licensee under a subsisting  agree-                  ment.  We now  proceed  to read section 15A:                        "(  1  ) Notwithstanding  anything  contained                  elsewhere  in this Act or anything contrary in  any                  other  law for the time being in force, or  in  any                  contract,  where  any person is on the 1st  day  of                  February 1973 in occupation of any premises, or any                  part  thereof which is not less than a room,  as  a                  licensee,  he shall on that date be deemed to  have                  become, for the purposes of this Act, the tenant of                  the  landlord, in respect of the premises  or  part                  thereof, in his occupation.                  (2) ......................................"             It  is thus clear beyond doubt that in order to get  the         advantage  of section 15A of the Bombay Rent Act, the  occu-         pant must be in occupation of the premises as a licensee  as         defined in section 5(4A) on the 1st of February, 1973. If he

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       be such a licensee, the non-obstante clause         10-1104SCI/76         408         of  section 15A(1) gives him the status and protection of  a         tenant in spite’ of there being anything to the contrary  in         any  other law or in any contract.  In other words, even  as         against  the  express terms of the  subsisting  contract  of         licence  the  licensee would enjoy the benefits  of  section         15A. But if  he is not a licensee under a subsisting  agree-         ment on the 1st of February, 1973, then he does not get  the         advantage  of the amended provision of the Bombay Rent  Act.         A  person  continuing in possession of  the  premises  after         termination, withdrawal or revocation of the licence contin-         ues  to occupy it as a trespasser or as a person who has  no         semblance  of  any right to continue in  occupation  of  the         premises. Such a person by no stretch of imagination can  be         called  a licensee. If therefore, the respondent was  not  a         licensee  under a subsisting agreement in occupation of  the         premises  on  the 1st of February, 1973 he  could  not  take         shelter under section 15A of, the Bombay Rent Act. The Trial         Judge found against him.  Apart from the position that  this         was  essentially a question of fact and a finding  on  which         could  not be interfered with by the High Court in  exercise         of  its  revisional power under section 115 of the  Code  of         Civil  Procedure,  the High Court has done so, as  we  shall         point  out, by committing such gross errors of law and  fact         that  we were constrained in the beginning of our  judgment,         though  very reluctantly, to make some  strong  observations         against the judgment of the High Court.             While  reciting the facts of the case the learned  Judge         of  the High Court states a fact in paragraph three  of  the         judgment that the respondent was ordered to deposit in Court         Rs.  29/- per month which he did. We are happy to note  that         the  learned  Judge has rightly not rested his  judgment  on         this ground of deposit of rent by the respondent.  There was         nothing to show in the records of this case that the  appel-         lants had ever accepted any money either in or outside court         from the respondent after 31st of March, 1966 by way of  any         rent of the licenced premises. A person continuing in  occu-         pation  of such premises after revocation of the licence  is         still  liable to pay compensation or damages for  their  use         and  occupation.  If at any time such compensation had  been         paid or accepted it could not undo the effect of the revoca-         tion of the licence.                  In  the  seventh  paragraph  of  the  judgment  the                  learned Judge says:                         "In my judgment the filing of the proceeding                  under  section 41 without terminating  the  licence                  and/or   the permission granted to  the  petitioner                  does  not automatically put an end to  the  licence                  which the petitioner had to occupy the premises."                  There are two infirmities in the said  observation.                  Firstly,  according  to the  appellants’  case  the                  licence  stood revoked and withdrawn and then  they                  filed  the  application  under section  41  of  the                  S.C.C. Act. Secondly, the filing of the application                  itself may in certain circumstances have the effect                  of putting an end to the licence if it was subsist-                  ing  on the date of its filing.  But in any  event,                  one thing is certain, that cannot have’ the  effect                  of  reviving the licence as opined by  the  learned                  Judge in the subsequent part of his judgment.                  409                  In the tenth paragraph of his judgment the  learned                  Judge says:

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                       "The  respondents  have not  relied  on  any                  notice  served on the petitioner to show that  they                  would  treat  the petitioner as a  trespasser  from                  March  31,  1966.   The respondents  did  not  even                  describe the petitioner as a trespasser in proceed-                  ings.  It must be therefore presumed that  the  re-                  spondents  voluntarily or  involuntarily  permitted                  the  petitioner  to occupy the premises  till  they                  filed  their  application under section 41  of  the                  Presidency Small Cause Courts Act."                        In  the  next  paragraph  the  learned  Judge                  quotes the words: "position not better than that of                  a  trespasser" from the appellants’ letter  written                  so  the  respondent.    The  contradiction  in  the                  judgment is apparent. It is difficult to understand                  the  significance  of  the  observation  "that  the                  respondents voluntarily or involuntarily  permitted                  the petitioner to occupy the premises".   Voluntary                  permission  may amount  to a fresh licence. The use                  of  the  expression involuntarily permitted’  is  a                  contradiction in terms.                      We  are  distressed to find the  learned  Judge                  repeatedly  expressing a view in his judgment  that                  the conduct on the part of the appellants in allow-                  ing the respondent to continue in the occupation of                  the  premises until the filing of  the  application                  under section 41 of the S.C.C. Act on July 10, 1967                  amounted  to  a grant of fresh licence. It  is  not                  necessary to extract all the strange passages  from                  the  judgment of the High Court. But we shah  do  a                  few more.  In the fifteenth paragraph while  refer-                  ring  to  the  expression "deemed  to  be  revoked"                  occurring in section 62(c) of the Easements Act  it                  is said that "it does not necessarily mean that  it                  is  in fact revoked." The mistake is so obvious  in                  this  observation  that  it does  not  require  any                  elaboration. In the same fifteenth paragraph occurs                  a passage which we exercised in vain to understand.                  It runs thus:                       "The  fact that the respondents did  not  take                  any  steps till  they filed the  application  under                  section 41 which also would  not automatically make                  the petitioner’s occupation unlawful means that the                  respondents  impliedly  granted a  licence  to  the                  petitioner to continue to occupy the premises."             Later on the learned Judge has said in his judgment that         by  adopting the procedure of filing the  application  under         section  41  of  the S.C.C. Act,  the  appellants  impliedly         granted to the respondent "a right to continue to occupy the         premises till he was evicted by an order under section  43."         Such a novel proposition of law is beyond our comprehension.         If  the filing of the application under section 41  gives  a         fight to the occupant of the premises to continue to  occupy         it,  then how can the Court pass an order of eviction  under         Section  43 in derogation or destruction of such a  right  ?         The  resulting  position is too anomalous and  illogical  to         merit any detailed discussion.             In the eighteenth paragraph of the judgment the  learned         Judge persuaded himself to say:         410               "The  fact that the earlier agreement of  licence  ex-         pired  on  March 31, 1966, does not  necessarily  mean  that         there  was no subsisting agreement on the date on which  the         application  under  section 41 was made or  on  February  1,         1973."

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       It  is difficult to understand what further act, conduct  or         writing  of the appellants led to the undoing of the  effect         of  the expiration of the earlier agreement of  licence  and         bring  about any subsisting agreement either on the date  of         the application under section 41 or on February 1, 1973.  We         admit  that  if any such agreement could be culled  out,  in         writing  or oral, expressly or impliedly, by the  action  or         the  conduct  of the appellants the Court  would  have  been         happy to cull out such agreement and give protection  to the         licensee in consonance  with the spirit  of the Amending Act         viz.  Maharashtra Act 17 of 1973. But the Court  cannot  and         should not cast the law to the winds or twist or stretch  it         to  a breaking point amounting to almost an absurdity.   Our         observation  is amply demonstrated by the following  passage         in the judgment of the High Court.                        "Relying on the amendment of the Bombay  Rent                  Act  the respondents no doubt had  withdrawn  their                  permission  under the agreements but by filing  the                  proceedings  under  section 41 they  permitted  the                  petitioner  to continue as the licensee  as  stated                  above;  and  this  itself is a  different  kind  of                  agreement of licence as defined under section 52 of                  the Easement Act."             The  learned Judge also seems to be making a  difference         between  the filing of a suit against a licensee  whose  li-         cence  has been terminated treating him as a trespasser  and         an application under section 41 of the S.C.C. Act.  For  the         purpose of the point at issue the distinction is more  illu-         sory than real.  Two remedies, previously, were available to         the  licensor.  He could avail the one or  the  other.   The         scope of the trial, disposal and further remedies in the two         proceedings  were different.  But it is wholly wrong to  say         that if a licensor filed an application under section 41  of         the  S.C.C. Act instead of filing a regular civil  suit   by         implication  treated  the occupant of the  premises  against         whom the S.C.C. application was filed as a subsisting.licen-         see.             In our opinion the judgment of the High Court is  wholly         wrong and suffers from serious infirmities of law and facts.         We accordingly allow this appeal, set aside the judgment and         order of the High Court and restore that of the Small  Cause         Court.  The respondent must pay the costs to the  appellants         in this Court as also in the High Court.         P.H.P.                                                Appeal         allowed.                                         1         ?411