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PETITIONER: W.H. KING

       Vs.

RESPONDENT: REPUBLIC OF INDIA AND ANOTHER.

DATE OF JUDGMENT: 01/02/1952

BENCH: AIYAR, N. CHANDRASEKHARA BENCH: AIYAR, N. CHANDRASEKHARA SASTRI, M. PATANJALI (CJ) MAHAJAN, MEHR CHAND MUKHERJEA, B.K. DAS, SUDHI RANJAN

CITATION:  1952 AIR  156            1952 SCR  418  CITATOR INFO :  R          1961 SC1554  (6)  RF         1982 SC 949  (15)

ACT: Bombay  Rents, Hotel and Lodging Rates Control Act (LVII  of 1947),  s.19-Tenant handing over possession to third  person receiving           "pugree"--Whether            constitutes "relinquishment"--Difference  between assignment and  relin- quishment--Construction of penal statutes.

HEADNOTE:    Sub-section  (1) of sec. 19 of the Bombay  Rents,  Hotel and Lodging House Rates Control Act, LVI I of 1947, provided that  "it shall not be lawful for the tenant or  any  person acting or purporting to act on behalf of the tenant to claim or  receive any sum or any consideration as a condition  for the  relinquishment  of his tenancy of  any  premises";  and sub-sec.  (2)  provided  that any tenant or  person  who  in contravention of the provisions of sub-sec. (1) receives any sum  or consideration shall on conviction be  punished  with imprisonment and also with fine.   A. who was a tenant of a flat, handed over vacant  posses- sion  the flat to B on receiving "pugree", under a  document which  recited that A shall have no claim whatever over  the flat and that B shall pay the rent directly to the landlord. A was convicted of an offence under sec. 19 (2).  Held, that there  was no "relinquishment" of his tenancy by  A,  within the  meaning of sec. 19 (1) and the conviction could not  be sustained.     There is a clear distinction between an assignment of  a tenancy on the one hand and a relinquishment or surrender on the  other. In the case of an assignment, the assignor  con- tinues  to be liable to the landlord for the performance  of his  obligations  under the tenancy and  this  liability  is contractual, while the assignee becomes liable by reason  of privity  of estate.  The consent of the landlord to  an  as- signment  is not necessary, in the absence of a contract  or local usage to the contrary.  But in the case of relinquish- ment  it cannot be a unilateral transaction; it can only  be

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in  favour of the lessor by mutual agreement  between  them. Relinquishment  of possession must be to the lessor  or  one who  holds  his interest; and  surrender  or  relinquishment terminates the lessee’s rights and lets in the lessor.     As sec. 19 of Bombay Act LVII of 1947 creates an offence and imposes a penalty of fine and imprisonment, the words of the  section  must be strictly construed in  favour  of  the subject.  The Court is not concerned so much with what might possibly  have been intended as with what has been  actually said in and by the language employed in the statute.   Judgment of the Bombay High Court reversed. 419

JUDGMENT:     CRIMINAL  APPELLATE  JURISDICTION:  Criminal Appeal  No. 8 of 1951.      Appeal  from  an  Order of the  High  Court  of  Bombay (Bavdekar  and Chainani JJ.) dated 20th February,  1950,  in Criminal  Appeal  No. 106 of 1950 arising out  of  an  order dated 9th January, 1950, of the Presidency Magistrate,  19th Court, Esplanade, Bombay, in Case No. 10879/P of 1949.   The facts are stated in the judgment.   Iswarlal C. Dalai and R.B. Dalai, for the appellant.  C.K. Daphtary,  Solicitor-General  for India (G. N.  Joshi,  with him) for the Republic of India (respondent No. 1).Jindra Lal for the respondent No. 2.     1952. February 1.  The Judgment of the Court was  deliv- ered by CHANDRASEKHARA AIYAR J.--The facts out of which this  Crimi- nal  Appeal  has arisen are not long.  The  appellant,  W.H. King, who is carrying on a business in Bombay under the name and  style  of Associated Commercial  Enterprises,  was  the tenant  of a flat on the second floor of a  building  called "Ganga  Vihar",  Marine Drive,  Bombay, which belongs  to  a lady named Durgeshwari Devi. The tenancy was a monthly  one, the rent being Rs. 215. It is said that the appellant wanted to go to the United Kingdom for treatment of his failing eye sight  and he got into touch with the  complainant  Mulchand Kodumal Bhatia, who is the second respondent in this appeal, through  one Sayed for the purpose of making  necessary  ar- rangements  about  the flat occupied by him in view  of  his intended departure. The prosecution case is that the accused demanded  a sum of Rs. 30,000 which was later on reduced  to Rs.  29,500 as consideration for putting the complainant  in vacant  possession of the flat and an additional  amount  of Rs. 2,000 for the furniture, and that the complainant agreed to pay these sums. The complainant actually paid the accused two sums of 420 Rs. 500 each on 7th November, 1948, and 17th November, 1948. He,  however, got into touch with the police  on  1-12-1948, and in conjunction with the latter, a trap was laid for  the appellant. It was arranged that the complainant should bring with him Rs. 1,000, being the balance due in respect of  the furniture  and that the police would give him Rs. 29,500  to be paid to the appellant.  The complainant and a Sub-Inspec- tor, posing as the complainant’s brother, went to the appel- lant  on 4-12-1948, and paid him the two sums of money;  and the  keys of the flat and the motor-garage were handed  over to  the  complainant.  As the appellant and  his  wife  were leaving the flat, the man, who masqueraded as the  complain- ant’s  brother,  threw off his disguise  and  disclosed  his identity.   The police party, who were down below ready  for

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the raid, held up the car of the appellant and recovered the sum  of  Rs. 30,500 from the rear seat of the car  and  also some  papers, a typed draft of a partnership  agreement  be- tween  the complainant and the appellant and an  application form  for  permission to occupy the building  as  caretaker. From  the complainant were recovered the bunch of  keys  and the documents that were handed over to him by the appellant, namely,  the letter handing vacant  possession (Exhibit  D). the  receipt  for Rs. 2,000 for the  articles  of  furniture (Exhibit E), a letter to the Bombay Gas Company for transfer of the gas connection to the name of the complainant (Exhib- it  F),  and the letter to the Bombay  Electric  Supply  and Transport  Committee for transfer of the  telephone  connec- tions and  the deposit of Rs. 27 (Exhibit G).       The  appellant was charged under section 18(1) of  the Bombay  Rents,  Hotel and Lodging House Rates  Control  Act, LVII  of 1947, for receiving a pugree of Rs. 29,500 and   he was   further  charged  under section 19(2) of the said  Act for  receiving  the said sum as a condition for  the  relin- quishment  of  his  tenancy. His wife, who  was  the  second accused in the case, was charged with  aiding and   abetting her husband in the commission of the two offences. 421     The  defence of the appellant was that he was in  search of  a partner to carry on his business during  his  intended absence,  who was also to act as caretaker of his flat  anal that  it  was in this connection and with   this  object  in view that he entered into negotiations   with the  complain- ant.  The sum of Rs. 29 500 was not pugree  but  represented capital  for 0-12-0 share in the   business and as the  com- plainant was also to be a caretaker of the flat, the sum  of Rs.  2,000  was  paid and received as  a  guarantee  against disposal and damage of the furniture and it was agreed to be paid  back on the appellant’s return to India.  The wife  of the appellant denied any aiding and abetting.       The Presidency Magistrate, who tried the case,  disbe- lieved  the  defence  on the facts, holding  that  what  was received by the accused was by way of pugree. As section  18 (1)  of  the Act was not applicable he convicted  him  under section  19(2) of the Act and sentenced him, in view of  his old age and blindness, to one day’s simple imprisonment  and a fine of Rs. 30,000.  The wife was acquitted, the  evidence being insufficient to prove any abetment.     The appellant  preferred an appeal to the High Court  of Bombay  but  it was summarily dismissed  on  20-2-1950.   He asked   for  a  certificate  under article 134(1)(c) of  the Constitution but this was rejected on  10-4-1950.   Thereaf- ter he applied for special leave to appeal to this Court and it was granted on 3-10-1950.      A  short legal argument was advanced on behalf  of  the appellant based on the language of section 19 (1) of the Act and this is the only point which requires our consideration. The section which consists of two parts is in these terms:"-      "(1)  It  shall  not be lawful for the  tenant  or  any person  acting or purporting to act on behalf of the  tenant to claim or receive any sum or any consideration as a condi- tion for the relinquishment of his tenancy of any premises; 422      (2)  Any tenant or person who in contravention  of  the provisions of sub-section (1) receives any sum or considera- tion shall, on conviction, be punished with imprisonment for a  term which may extend to 6 months and shall also be  pun- ished with fine which shall not be less than the sum or  the value of the consideration received by him."    It  was urged that the offence arises only on receipt  of

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any  sum or any consideration as a condition of  the  relin- quishment by a tenant of his tenancy and that in the present case  there was no such relinquishment. Exhibit D, which  is the most material document, under which the appellant handed over  vacant  possession  of the flat  to  the  complainant, constitutes  or evidences an assignment of the  tenancy  and not a relinquishment. It says :--    "I,  W.H. King, hereby hand over vacant possession of  my flat  No.  3 situated on 2nd floor and garage No. 4  on  the ground floor of Ganga Vihar Building on Plot No. 55 situated on  Marine  Drive Road to Mr. Mulchand Kodumal  Bhatia  from this  day  onward and that I have no claim  whatsoever  over this flat and Mr. Mulchand Kodumal Bhatia will pay the  rent directly to the landlord."     The  argument raised on behalf of the appellant  appears to us to be sound and has to be accepted. The learned Solic- itor-General urged that ’the word "relinquishment"  was  not a  term  of  art and was used in the  section  not   in  any strict  technical sense but in its comprehensive meaning  as giving up of possession of the premises; and he pointed  out that if it was intended by the legislature that "relinquish- ment"  should have the limited meaning sought to  be  placed upon  it  on behalf of the appellant, the  word  "surrender" used  in the Transfer of Property Act would have  been  more appropriate. Sections 15 and 18 of the Act were referred  to in  this connection but in our opinion they lend no  assist- ance  to the argument of the learned counsel.   Any  sublet- ting,  assignment  or transfer in any other  manner  of  his interest by the tenant is made unlawful under 423 section  15.   Section 18 deals with the grant,  renewal  or continuance of a lease of any premises or the giving of  his consent  by the landlord to the transfer of a lease by  sub- lease or otherwise, and it provides that the   landlord, who receives any fine, premium, or other like sum or deposit, or any  consideration for the grant, renewal or continuance  or the  accord of consent oh would be guilty of an offence  and liable  to the punishment therein specified.  It would  thus be seen that an assignment of the lease or transfer in   any other manner by a tenant is not made an offence; the statute merely says that it is not a lawful transaction.  It is  the landlord’s  consent to the transfer of a lease by  sub-lease or otherwise on receipt of consideration that has been  made an  offence.   Then follows section 19 which speaks  of  the relinquishment  of his tenancy of any premises by a  tenant. If, by the expression, an assignment such as we have in  the present  case was meant, appropriate words could  have  been used,  such  as the transfer by a tenant  of  his  interest, which we find in section 108, sub-clause (i), of the  Trans- fer of Property Act.    The distinction between an assignment on the one hand and relinquishment or surrender on the other is too plain to  be ignored. In the case of an assignment, the assignor  contin- ues to be liable to the landlord for the performance of  his obligations under the tenancy and this liability is contrac- tual, while the assignee becomes liable by reason of privity of  estate. The consent of the landlord to an assignment  is not  necessary, in the absence of a contract or local  usage to  the  contrary.  But in the case  of  relinquishment,  it cannot be a unilateral transaction; it can only be in favour of the lessor by mutual agreement between them.  The  relin- quishment  of  possession must be to the lessor or  one  who holds his interest.  In fact, a surrender or  relinquishment terminates the lessee’s rights and lets in the lessor. It is no doubt true that the word "relinquishment" does not  occur

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in  the Transfer of Property Act but it is found in many  of the  Tenancy Acts in various provinces where there are  Sec- tions which deal with the 55 424 relinquishment of their holdings by tenants in favour of the landlord  by notice given to him in writing. The section  in question,  it  should be further noted, does  not  speak  of relinquishment or giving up of possession,in general  terms. The  words  are "the relinquishment of his  tenancy  of  any premises".  The relinquishment of a tenancy is equivalent to surrender  by  the lessee or tenant of his rights  as  such. Whether  abandonment   of a tenancy would  come  within  the meaning of relinquishment is a question that does not  arise in  this appeal, because in the face of Exhibit D, there  is no abandonment in the sense that the tenant disappeared from the  scene altogether saying nothing and making no  arrange- ments about his interest and possession under the lease.     As the statute creates an offence and imposes a  penalty of fine and imprisonment, the words of the  section must  be strictly  construed  in favour of the subject.  We  are  not concerned so much with what might possibly have been intend- ed  as  with  what has been actually  said in  and   by  the language employed.    As in our view, there has been no "relinquishment" within the  meaning of section 19, sub-clause (1),  the  conviction under  sub-clause (2) cannot be sustained. It is  set  aside and  the fine of Rs. 30,000 will be refunded if it  has  al- ready been paid. The other parts of the order of the learned Presidency Magistrate, as regards the disposal of Rs.  1,000 paid by the complainant to the appellant and the sum of  Rs. 29,500 brought in by the police, will, however, stand.                                Conviction sit aside. Agent for the appellant: P.K. Chatterjee. Agent for respondent No. 1: P.A. Mehta. Agent for respondent No. 2: Ganpat Rai. 425