Lawful possession is not litigious possession and must have some foundation in a legal right to possess the property which cannot be equated with a temporary right to enforce recovery of the property in case a person is wrongfully or forcibly dispossessed from it. This Court in Lalu Yeshwant Singh's case (supra) had not to consider whether judicial possession in that case was also lawful possession. We are clearly of opinion that juridical possession is possession protected by law against wrongful dispossession but cannot per se always be equated with lawful possession."
PETITIONER:
R.V. BHUPAL PRASAD
Vs.
RESPONDENT:
STATE OF ANDHRA PRADESH & ORS.
DATE OF JUDGMENT11/08/1995
BENCH:
RAMASWAMY, K.
HANSARIA B.L. (J)
CITATION:
1996 AIR 140 1995 SCC (5) 698
JT 1995 (6) 258 1995 SCALE (5)41
Smt. Saleha Begum, the 3rd respondent has demised her
property, namely, Shaensha Mahal situated on Congress Road,
Governorpet, Vijayawada, A.P. to the appellant for a period
of 20 years by lease deed dated January 1, 1964 and in
furtherance thereof, the appellant has been running the
exhibition of Cinematograph films in the said theatre. The
lease, by efflux of twenty years, contracted thereunder
expired on December 31, 1983. When the appellant sought
renewal of the licence granted under the A.P. Cinemas
(Regulation) Rules, 1970 (for short, `the Rules'), the
landlady objected to the renewal. The licensing authority
and the appellate authority had granted licence but in a
write petition filed by the landlady the learned single
judge held that the appellant is not in lawful possession of
the theatre and that, therefore, the grant of renewal was
not justified in law. This was affirmed in W.A. Nos.1118 and
1183 of 1992 dated September 3, 1993. Thus these appeals by
special leave.
Sri U.R. Lalit, learned senior counsel for the
appellant, contended that in 1983, the Rules have been
amended and the pre-existing Rule has been bifurcated into
initial grant of licence in Rule 11(B) and renewal is
separately dealt with under Rule 12(B). Rule 11(B), sub-rule
(2) envisages proof of lawful possession of the site,
building and the equipment, while Rule 12(B) expressly omits
to satisfy the requirement. The rule making authority having
had knowledge of the decisions rendered by various courts
including this Court on the insistence of proof of lawful
possession by the licensee and unlawful or litigious
possession disentitles the licensee to have renewal, rule
making authority had done away with the requirement of being
in lawful possession at the stage of granting renewal. On
interpretation of the rules, the legislative intendment
should be given effect to. The Full Bench of the Andhra
Pradesh High Court in Smt. Y. Anasuya v. Government of A.P.
[1993 (1) ALT 661 (F.B.)] wrongly interpreted the rule
bringing the requirement of being in lawful possession at
the stage of granting renewal. He also further contended
that the appellant having lawfully entered into possession
and having remained in possession during the subsisting
period of lease and after expiry thereof, his possession
also is juridical possession until he is duly ejected by a
decree of the Court. His possession cannot be termed to be
unlawful nor can he be treated as a rank trespasser. The
appellant is in long settled possession. The appellant is in
long settled possession. The object of the Rules is to
facilitate the exhibition of Cinematograph films to
entertain the public. When the licensee is in settled
possession protected by general law, he continues to be in
lawful possession till he is duly ejected. While
interpreting the Rule, the Court would endeavour to give
effect to the juridical possession so long as he is not duly
ejected in due course of law. The Full Bench, therefore, was
not right in its conclusion. In support thereof, he placed
reliance on the decision of this Court in Lalu Yeshwant
Singh v. Rao Jagdish Singh & Ors. [(1968) 2 SCR 203] and in
Krishna Kishore Firm v. Govt. of A.P. & Ors. [(1990) Supp. 2
SCR 8 at 11]. He also cited in his support East India Hotels
Ltd. v. Syndicate Bank [(1992) Supp 2 SCC 29].
Sri K. Ram Kumar, learned counsel appearing for
respondent No.3, contended that under the conditions of the
lease, on its expiry, the appellant had to deliver not only
the vacant possession but also the equipment without
claiming any compensation. There is nothing to indicate that
the landlady had acquiesced in the appellant's continuance
in possession of the theatre after the expiry of the lease.
In fact, the landlady filed O.S. No.538/85 on the file of
the Court of the Principal Subordinate Judge at Vijayawada
for eviction of the appellant from the demised premises
which would indicate that the possession of the appellant
was never treated to be lawful. It is also contended that
the Full Bench, while interpreting the Rule, has taken
notice is to be renewed it should be subject to the
willingness of the lessor. When the lessor objected to the
grant of the licence on the ground that she had not
acquiesced in the possession of the licensee under the
Rules, the possession of the licensee of the theatre cannot
be considered to be lawful possession. Therefore, the High
Court was right in its conclusion that the possession of the
appellant is not lawful for grant of the renewal of the
licence.
The respective contentions give rise to the question
whether the possession of the appellant is lawful
possession. Rule 11(B), sub-rule (2) envisages thus :
"(2) On receipt of the reports and
certificates referred to in clause (b)
for sub-rule (1) or, if the same have
not been received in time on
consideration of the certificates
referred to in clause (c) of Rule 11-A
on merits, if the licensing authority is
satisfied that the applicant is in
lawful possession of the site, building
and equipment he shall, within ten days
from the date of receipt of the above
reports and certificates or the due date
for the receipt of above reports and
certificates grant a license in Form-B
with or without adding additional
conditions thereto, consistent with the
provisions of these rules, as he may
deem fit in the interest of the health
and safety of the public;
Provided that if the licensing
authority is satisfied that the
provisions of these rules have not been
fulfilled and or that, in the case of a
temporary cinema building the provisions
in Appendix-IV are not fulfilled he may
refuse to grant the licence applied for
the communicate to the applicant the
reasons for such refusal.
Provided also that the period of
validity of a licence shall so far it
may be co-related with the period of
validity of electrical and fire
certificate granted in accordance with
the provisions in Appendix-IV."
Rule 12 (B) (1) read thus:
"Renwal of Licences to cinema buildings
:- (1) within fifteen days of receipt of
such application, the licensing
authority shall;
(a) If the application is not in
accordance with the rules, dispose it of
in accordance with clause (a) of sub-
rule (1) of Rule 9(B).
(b) If the application is in order, the
electrical and fire certificate is valid
and if the certificate of longevity of
the building initially issued by the
concerned Executive Engineer (R&B) is
valid for the period for which the
renewal of licence is applied for, the
licence may be renewed for the period
applied for:
Provided further that, in case of
an application for renewal of a licence
(in respect of a permanent cinema
building) which is made three months in
advance of the expiry of the licence, if
the authorities concerned do not furnish
their reports and certificates in time,
the respective certificates shall be
deemed to have been renewed;
Provided that if the licensing
authority is satisfied that the
provisions of these rules have not been
fulfilled he may refuse to grant the
renewal applied for and communicate to
the applicant the reasons for such
refusal;
Provided further that the period of
validity of electrical and fire
certificate granted in accordance with
the provision in Appendix-VI."
It is true, as rightly pointed out by Shri U.R. Lalit,
that under Rules 11 of the unamended Rules, the right to
initial grant and the renewal of the licence was
compendiously considered as an integral scheme in single
Rule, which was thereafter, i.e. in 1983, amended giving
separate headings and consideration for the grant of the
licence and grant of renewal of the licence. One of the
conditions for the grant of licence is that the applicant
shall satisfy the licensing authority that the applicant is
in lawful possession of the site, building and equipment.
When the licensee sought renewal of the licence, diverse
conditions prescribed in Rule 12(B) are required to be
complied with. Application for renewal of a licence for a
permanent cinema building should be made three months in
advance of the expiry of licence. If the authorities
concerned do not furnish their reports and certificates in
time, the respective certificates shall be deemed to have
been renewed provided that if the licensing authority is
satisfied that the provisions of these rules have not been
fulfilled he may refuse to grant the renewal applied for and
communicate to the applicant the reasons for such-refusal.
The second proviso provides clearly that not only the
conditions enumerated in clauses (a) and (b) of sub-rule
(1), but also all the provisions of the Rules should be
satisfied for the grant of the renewal.
For the grant of the licence, one of the requirements
is that the applicant should have lawful possession of site,
building and equipment. It is true that the right to grant
licence and right to grant renewal are separately dealt with
by Rule 11(B) and Rule 12(B) respectively. But when Rule
11(B) and Rule 12(B) respectively. But when Rule 12(B)(1),
second proviso itself indicates that the licensing authority
should satisfy itself that the licensee that satisfied all
the provisions of the rules, the licensee should satisfy
that he is in lawful possession when he seeks renewal.
Section 105 of the Transfer of Property Act [for short,
`the TP Act'] defines "lease" of immovable property as "a
transfer of a right to enjoy such property, made for a
certain time, express or implied, or in perpetuity, in
consideration of a price paid or promised, or of money a
share of crops, service or any other thing of value, to be
rendered periodically or on specified occasions to the
transfer by the transferee,who accepts the transfer on such
terms". Therefore the lessor of immovable property by
contract in writing or otherwise can transfer his property
to the lessee to enjoy such property. It may be made for a
certain time, express or implied, or in perpetuity, in
consideration of a price or promised, or of money etc. and
the lessee accepts the transfer on such terms. Under Section
111 of the TP Act, a lease of immovable property determines,
inter alia, by efflux of the time limited. Section 116
envisages the effect of holding over and provides that "if a
lessee or under-lessee of property remains in possession
thereof after the determination of the lease granted to the
lessee, and the lessor or his legal representative accepts
rent from the lessee or under-lessee, or otherwise assents
to his continuing in possession, the lease is, in absence of
an agreement to the contrary, renewed from year to year, or
from month to month, according to the purpose for which the
property is leased, as specified in Section 106". Section
106 of the TP Act deals with the duration of certain leases
in the absence of written contract or local usage with which
we are not concerned in this case since the appellant and
the landlady are governed by the written lease. Since the
landlady had not accepted or asserted to the appellant's
continuance in possession, he cannot be treated under
Section 116 to be a tenant holding over.
Tenant at sufferance is one who comes into possession
of land by lawful title, but who holds it by wrong after the
termination of the term or expiry of the lease by efflux of
time. The tenant at sufferance is, therefore, one who
wrongfully continues in possession after the extinction of a
lawful title. There is little difference between him and a
trespasser. In Mulla's Transfer of Property Act [7th End.]
at page 633, the position of tenancy at sufferance has been
stated thus: A tenancy at sufferance is merely a fiction to
avoid continuance in possession operating as a trespass. It
has been described as the least and lowest interest which
can subsist in reality. It, therefore, cannot be created by
contract and arises only by implication of law when a person
who has been in possession under a lawful title continues in
possession after that title has been determined, without the
consent of the person entitled. A Tenancy at sufferance does
not create the relationship of landlord and tenant. At page
769, it is stated regarding the right of a tenant holding
over thus: The act of holding over after the expiration of
the term does not necessarily create a tenancy of any kind.
If the lessee remaining in possession after the
determination of the term, the common law rule is that he is
a tenant on sufferance. The expression "holding over" is
used in the sense of retaining possession. A distinction
should be drawn between a tenant continuing in possession
after the determination of the lease, without the consent of
the landlord and a tenant doing so with the landlord's
consent. The former is called a tenant by sufferance in the
language of the English law and the latter class of tenants
is called a tenant holding over or a tenant at will. The
lessee holding over with the consent of the lessor is in a
better position than a mere tenant at will. The tenancy on
sufferance is converted into a tenancy at will by the assent
of the landlord, but the relationship of the landlord and
tenant is not established until the rent was paid and
accepted. The assent of the landlord to the continuance of
the tenancy after the determination of the tenancy would
create a new tenancy. The possession of a tenant who has
ceased to be a tenant is protected by law. Although he may
not have a right to continue in possession after the
termination of the tenancy, his possession is
juridical.
The question then is what is the meaning of the
expression `lawful possession'. This was considered by this
Court in a leading decision on the right to grant licence
under the Cinematographic Act and Madras Cinemas Rules in
M.C. Chockalingam & Ors. v. V. Manickavasagam & Ors.,
[(1974) 2 SCR 143 at 152]. Rule 13 of the Madras Rules
required the licensee in lawful possession, when he had
applied for renewal after the expiry of the lease of the
licensee. The Court observed thus:
"Turning to rule 13, even in the first
part if the applicant for the licence is
the owner of the property he has to
produce before the licensing authority
the necessary records not only relating
to his ownership but also regarding his
possession. It is implicit, that the
owner having a title to the property, if
he can satisfy the licensing authority
with regard to his possession also, will
indeed be in `lawful possession',
although the word `lawful' is not used
in the first part. It is in that context
that the word `possession' is even not
necessary to be qualified by `lawful' in
the first part of rule 13. If, however,
the applicant for the licence is not the
owner, there is no question of his
showing title to the property and the
only requirement of the law is to
produce to the satisfaction of the
authority documentary evidence with
regard to his lawful possession of the
property. The word `lawful'. therefore,
naturally assumes significance in the
second part while it was not even
necessary in the first part. The fact
that after expiry of the lease the
tenant will be able to continue in
possession of the property by resisting
a suit for eviction, does not establish
a case in law slaw to answer the
requirement of lawful possession of the
property within the meaning of rule 13.
Lawful possession cannot be established
without the concomitant existence of
lawful relationship between the landlord
and the tenant. This relationship cannot
be established against the consent of
the landlord unless, however, in view of
a special law, his consent becomes
irrelevant. Lawful possession is not
litigious possession and must have some
foundation in a legal right to possess
the property which cannot be equated
with a temporary right to enforce
recovery of the property in case a
person is wrongfully or forcibly
dispossessed from it. This Court in Lalu
Yeshwant Singh's case (supra) had not to
consider whether judicial possession in
that case was also lawful possession. We
are clearly of opinion that juridical
possession is possession protected by
law against wrongful dispossession but
cannot per se always be equated with
lawful possession."
This decision has been followed in many subsequent
decisions of this Court. In Krishna Kishor Firm's case
(supra), this Court has considered the controversy in a
slightly different scenario. The facts therein were that the
appellant-firm while running the Cinema Theatre on a licence
granted pursuant to a lease by the landlords, one of the co-
owners had agreed to sell his share of the property and
another co-owner also entered separately into a lease. The
question therein was whether the possession was lawful
possession under the Rules. Giving various illustrations,
this Court held that the lawful possession means legal
possession which is also rightful or at least excusable.
Thus that which is not stricto legalo may yet be lawful. It
should not be forbidden by law. In fact "legal" is
associated with provisions in the Act, rules etc. whereas
"lawful" visualizes all that is not illegal, against law or
even permissible. "Lawful" is wider in connotation than
"legal". Although provisions in Specific Relief Act
empowering a person or tenant to recover possession if he
has been evicted forcibly by the landlord, may be juridical
and not lawful or a tenant holding over is not in lawful
possession unless landlord agrees or acquiesces in expressly
or impliedly but that does not alter the legal position
about possession of a person not legal yet not without
interest. In considering the Chockalingam's case, this Court
made a distinction between nature of the possession of the
lessee after the expiry of period of lease and the nature of
the possession of the lessee acquiesced in by the landlord.
In that context, it was pointed out that the lessee before
expiry of period of lease acquired lessor's entire interest
resulting in drowning or sinking of inferior right into
superior right. That is a right one of merger into another.
It has been separately recognised by Section 111(d) of the
TP Act. Similarly, a tenant after expiry of period of lease
may be holding over and the lessor may acquiesce in his
continuance, expressly or impliedly. That is from conduct
into lawful. The other may be where lessor may not agree to
renew the lease nor he may acquiesce in his continuance.
Such a lessee cannot claim any right or interest. His
possession is neither legal nor lawful. Such was the ratio
of Chockalingam's case.
In the backdrop of the factual position, law laid down
by this Court in Krishna Kishore Firm's case [supra]
requires to be understood. It is seen that one of the
lessors had entered into an agreement of sale with the
lessee to the extent of his share in the joint property and
some of the co-owners had also entered into a fresh lease to
the extent of their share in that property. The property
being joint and indivisible, in that backdrop this Court had
held that the possession of the appellant therein cannot be
considered to be unlawful. The ratio is clearly
distinguishable. Decision of this Court in Lalu Yeshwant
Singh's case [supra] also renders little assistance to the
appellant. Therein, the tenant had committed default in
payment of rent. The landlord instead of filing a suit for
ejectment of the tenant had taken law into his hands and had
the tenant forcibly ejected from possession. When he
approached the Court, this Court settled the legal position
that the landlord is not permitted to take forcible
possession except in due process of law and they must obtain
such possession as they are entitled through court of law as
the law recognised. The possession of a tenant who had
ceased to be a tenant, after expiry or termination of the
lease, is protected by law until he is duly ejected.
Although he may not have a legal right to continue in
possession after the termination of the tenancy or after the
expiry of the tenancy, his possession was at sufferance
recognised to be juridical and that possession is protected
by Common law.
Suppose a person trespasses into Government land and
remains in unlawful possession, whether he is liable to be
ejected under the Public Premises Act. Since Government has
not recognised the right of the trespasser to remain in
possession of the Government land, the Government is free to
take action as is available under law either under Public
Premises Act or appropriate law. But the Government cannot
forcibly eject the trespasser. In fact, this sort of
controversy had arisen in East India Hotels Ltd. case
[supra]. Therein, the licensor, after the fire had broken in
the premises, requested to give possession for effecting
repairers and the licensor was alleged to have promised to
give back possession to the licensee. Since the possession
was not redelivered, the licensee approached the High Court
under Section 6 of the Specific Relief Act, 1963 for
possession. The High Court granted decree for possession
until he was duly ejected. One of us [K. Ramaswamy, J.]
considered the entire case law including the cases cited by
Sri Lalit in the context of the power of the Court under
section 6 of the Specific Relief Act to grant decree for
possession for a licensee. It was held in para 44 that:
"Law respects possession even if there
is no title to support it. No one is
permitted to take law in one's own hands
and to dispossess the person in actual
settled possession without due course of
law. No person can be allowed to become
a judge in his own case. The object of
s.6 is to discourage people to act in
self-help, however, good their title may
be. The licensee in possession for well
over 15 years is in settled possession
and is entitled to remain in possession
and is entitled to remain in possession
and make use of the premises for the
purpose for which it was demised until
he is ejected in due course of law. The
acquiescence of the landlord in this
context would be to the initial unlawful
entry into possession and continuation
thereafter but not to the continuance in
possession of the licensee after the
expiry or termination of the licence.
That was what this Court appears to have
meant in the previous decisions. Take
for instance that when a licence was
granted for a couple of years and after
its expiry by efflux of time, or on
termination, if the possession of the
licensee, though unlawful and unjust is
not protected, the aggressor or mighty
would trample upon the right of the weak
and meek and denial of relief under s.6
would put a premium upon the aggression
or treachery or tricks. No doubt long
delay in disposal of cases due to docket
explosion became a ruse to unscrupulous
litigant to abuse the due course of law
to protract litigation and remain in
unjust or wrongful possession of
property. Landlord could be suitably
compensated by award of damages. It
cannot, by any stretch of imagination,
be said that a person in settled
possession, though unlawful, is not
entitled to the protection under s.6 of
the Act. Maintenance of law and order
and enthusing confidence in the efficacy
of rule of law are condition precedent
for orderly society. Therefore, giving
primacy, legitimacy or legality to the
conduct or acts of the landlord to take
possession of the property in derogation
of the due course of law would be
deleterious to rule of law and a pat on
high-handedness or self-help."
It was held that so long as the licensee has not been
evicted in execution of the decree lawfully obtained, his
possession under s.6 of the Act as a licensee is protected.
Section 6 can be availed of to recover possession until he
is lawfully dispossessed in due course of law.
In view of the settled position of law, the possession
of the appellant is as tenant at sufferance and is liable to
ejectment in due course of law. But his possession is not
legal nor lawful. In other words, his possession of the
theatre is unlawful or litigious possession. The appellant
may remain in possession until he is ejected in due course
in execution of the decree in the suit filed by the
respondent. His possession cannot be considered to be
settled possession. He is akin to a trespasser, though
initially he had lawful entry.
In this behalf, it is necessary to see even the
contract under which he was put in possession.
Para 22 & 23 of the contract reads thus:
22. "That the lessee shall quit the
scheduled properties on expiry of the
lease period and deliver possession of
the entire demised properties to the
Lessor including furniture installed by
the Lessors and other improvements,
alterations, constructions
reconstructions and additions effected
by the Lessees if any in good condition
subject only to the changes caused by
reasonable wear and tear and
irresistible force; that in default of
so quitting the premises, the Lessees
shall pay enhanced rent and damages at
the rate of Rs.100/-per day, till they
are evicted by the provisions of law by
the Lessor.
23. On expiry of the lease period, the
Lessees should sign all necessary
applications and papers and co-operate
to obtain transfer of all the licences
back in the name of Lessor or her
nominees promptly and also send all
necessary statements to the officers
concerned for the purpose or otherwise,
the Lessor gets every right to get all
the licences transferred in her name
automatically immediately after the
expiry of the Lease period."
A reading of these two covenants clearly manifests the
intention of the parties that after the expiry of the lease
he is enjoined to deliver possession of the demised premises
to the landlady.
After the expiry of the lease,he is treated to be in
unlawful possession, since he is required to pay damages for
use and occupation at the rate of Rs.100/- per day till he
is evicted in due course of law. Thereby it is clear that
his possession was not treated to be juridical possession
was not treated to be juridical possession but only
unlawful. He is required to pay damages for use and
occupation. Clause 23 indicates that on expiry of the lease,
the lessees should sign all necessary applications and
papers and cooperate with the lessor to obtain transfer of
all the licences. That would clearly indicate the intention,
namely, that the appellant shall remain in possession only
for the period of twenty years and thereafter his possession
becomes unlawful.
The High Court, therefore, was right in its conclusion
that the possession of the appellant is unlawful. The
learned Single Judge of the High Court [K. Ramaswamy, J., as
he then was] in M. Kameswara Somayajulu vs. State of A.P.
[1989 (1) APL] 82 (SN)] was not correct in his holding that
at the time of renewal, the licensee need not establish his
lawful possession due to omission in Rule 12(B) (1) which
was followed by another Division Bench. The Full Bench has
reconsidered the controversy. For different reasons given by
us, we think that the conclusion reached by the Full Bench
is correct.
The appeals are dismissed. No costs. The respondents
are entitled to withdraw the amount deposited by the
appellant pursuant to the interim order passed by this
Court.
Print Page
PETITIONER:
R.V. BHUPAL PRASAD
Vs.
RESPONDENT:
STATE OF ANDHRA PRADESH & ORS.
DATE OF JUDGMENT11/08/1995
BENCH:
RAMASWAMY, K.
HANSARIA B.L. (J)
CITATION:
1996 AIR 140 1995 SCC (5) 698
JT 1995 (6) 258 1995 SCALE (5)41
Smt. Saleha Begum, the 3rd respondent has demised her
property, namely, Shaensha Mahal situated on Congress Road,
Governorpet, Vijayawada, A.P. to the appellant for a period
of 20 years by lease deed dated January 1, 1964 and in
furtherance thereof, the appellant has been running the
exhibition of Cinematograph films in the said theatre. The
lease, by efflux of twenty years, contracted thereunder
expired on December 31, 1983. When the appellant sought
renewal of the licence granted under the A.P. Cinemas
(Regulation) Rules, 1970 (for short, `the Rules'), the
landlady objected to the renewal. The licensing authority
and the appellate authority had granted licence but in a
write petition filed by the landlady the learned single
judge held that the appellant is not in lawful possession of
the theatre and that, therefore, the grant of renewal was
not justified in law. This was affirmed in W.A. Nos.1118 and
1183 of 1992 dated September 3, 1993. Thus these appeals by
special leave.
Sri U.R. Lalit, learned senior counsel for the
appellant, contended that in 1983, the Rules have been
amended and the pre-existing Rule has been bifurcated into
initial grant of licence in Rule 11(B) and renewal is
separately dealt with under Rule 12(B). Rule 11(B), sub-rule
(2) envisages proof of lawful possession of the site,
building and the equipment, while Rule 12(B) expressly omits
to satisfy the requirement. The rule making authority having
had knowledge of the decisions rendered by various courts
including this Court on the insistence of proof of lawful
possession by the licensee and unlawful or litigious
possession disentitles the licensee to have renewal, rule
making authority had done away with the requirement of being
in lawful possession at the stage of granting renewal. On
interpretation of the rules, the legislative intendment
should be given effect to. The Full Bench of the Andhra
Pradesh High Court in Smt. Y. Anasuya v. Government of A.P.
[1993 (1) ALT 661 (F.B.)] wrongly interpreted the rule
bringing the requirement of being in lawful possession at
the stage of granting renewal. He also further contended
that the appellant having lawfully entered into possession
and having remained in possession during the subsisting
period of lease and after expiry thereof, his possession
also is juridical possession until he is duly ejected by a
decree of the Court. His possession cannot be termed to be
unlawful nor can he be treated as a rank trespasser. The
appellant is in long settled possession. The appellant is in
long settled possession. The object of the Rules is to
facilitate the exhibition of Cinematograph films to
entertain the public. When the licensee is in settled
possession protected by general law, he continues to be in
lawful possession till he is duly ejected. While
interpreting the Rule, the Court would endeavour to give
effect to the juridical possession so long as he is not duly
ejected in due course of law. The Full Bench, therefore, was
not right in its conclusion. In support thereof, he placed
reliance on the decision of this Court in Lalu Yeshwant
Singh v. Rao Jagdish Singh & Ors. [(1968) 2 SCR 203] and in
Krishna Kishore Firm v. Govt. of A.P. & Ors. [(1990) Supp. 2
SCR 8 at 11]. He also cited in his support East India Hotels
Ltd. v. Syndicate Bank [(1992) Supp 2 SCC 29].
Sri K. Ram Kumar, learned counsel appearing for
respondent No.3, contended that under the conditions of the
lease, on its expiry, the appellant had to deliver not only
the vacant possession but also the equipment without
claiming any compensation. There is nothing to indicate that
the landlady had acquiesced in the appellant's continuance
in possession of the theatre after the expiry of the lease.
In fact, the landlady filed O.S. No.538/85 on the file of
the Court of the Principal Subordinate Judge at Vijayawada
for eviction of the appellant from the demised premises
which would indicate that the possession of the appellant
was never treated to be lawful. It is also contended that
the Full Bench, while interpreting the Rule, has taken
notice is to be renewed it should be subject to the
willingness of the lessor. When the lessor objected to the
grant of the licence on the ground that she had not
acquiesced in the possession of the licensee under the
Rules, the possession of the licensee of the theatre cannot
be considered to be lawful possession. Therefore, the High
Court was right in its conclusion that the possession of the
appellant is not lawful for grant of the renewal of the
licence.
The respective contentions give rise to the question
whether the possession of the appellant is lawful
possession. Rule 11(B), sub-rule (2) envisages thus :
"(2) On receipt of the reports and
certificates referred to in clause (b)
for sub-rule (1) or, if the same have
not been received in time on
consideration of the certificates
referred to in clause (c) of Rule 11-A
on merits, if the licensing authority is
satisfied that the applicant is in
lawful possession of the site, building
and equipment he shall, within ten days
from the date of receipt of the above
reports and certificates or the due date
for the receipt of above reports and
certificates grant a license in Form-B
with or without adding additional
conditions thereto, consistent with the
provisions of these rules, as he may
deem fit in the interest of the health
and safety of the public;
Provided that if the licensing
authority is satisfied that the
provisions of these rules have not been
fulfilled and or that, in the case of a
temporary cinema building the provisions
in Appendix-IV are not fulfilled he may
refuse to grant the licence applied for
the communicate to the applicant the
reasons for such refusal.
Provided also that the period of
validity of a licence shall so far it
may be co-related with the period of
validity of electrical and fire
certificate granted in accordance with
the provisions in Appendix-IV."
Rule 12 (B) (1) read thus:
"Renwal of Licences to cinema buildings
:- (1) within fifteen days of receipt of
such application, the licensing
authority shall;
(a) If the application is not in
accordance with the rules, dispose it of
in accordance with clause (a) of sub-
rule (1) of Rule 9(B).
(b) If the application is in order, the
electrical and fire certificate is valid
and if the certificate of longevity of
the building initially issued by the
concerned Executive Engineer (R&B) is
valid for the period for which the
renewal of licence is applied for, the
licence may be renewed for the period
applied for:
Provided further that, in case of
an application for renewal of a licence
(in respect of a permanent cinema
building) which is made three months in
advance of the expiry of the licence, if
the authorities concerned do not furnish
their reports and certificates in time,
the respective certificates shall be
deemed to have been renewed;
Provided that if the licensing
authority is satisfied that the
provisions of these rules have not been
fulfilled he may refuse to grant the
renewal applied for and communicate to
the applicant the reasons for such
refusal;
Provided further that the period of
validity of electrical and fire
certificate granted in accordance with
the provision in Appendix-VI."
It is true, as rightly pointed out by Shri U.R. Lalit,
that under Rules 11 of the unamended Rules, the right to
initial grant and the renewal of the licence was
compendiously considered as an integral scheme in single
Rule, which was thereafter, i.e. in 1983, amended giving
separate headings and consideration for the grant of the
licence and grant of renewal of the licence. One of the
conditions for the grant of licence is that the applicant
shall satisfy the licensing authority that the applicant is
in lawful possession of the site, building and equipment.
When the licensee sought renewal of the licence, diverse
conditions prescribed in Rule 12(B) are required to be
complied with. Application for renewal of a licence for a
permanent cinema building should be made three months in
advance of the expiry of licence. If the authorities
concerned do not furnish their reports and certificates in
time, the respective certificates shall be deemed to have
been renewed provided that if the licensing authority is
satisfied that the provisions of these rules have not been
fulfilled he may refuse to grant the renewal applied for and
communicate to the applicant the reasons for such-refusal.
The second proviso provides clearly that not only the
conditions enumerated in clauses (a) and (b) of sub-rule
(1), but also all the provisions of the Rules should be
satisfied for the grant of the renewal.
For the grant of the licence, one of the requirements
is that the applicant should have lawful possession of site,
building and equipment. It is true that the right to grant
licence and right to grant renewal are separately dealt with
by Rule 11(B) and Rule 12(B) respectively. But when Rule
11(B) and Rule 12(B) respectively. But when Rule 12(B)(1),
second proviso itself indicates that the licensing authority
should satisfy itself that the licensee that satisfied all
the provisions of the rules, the licensee should satisfy
that he is in lawful possession when he seeks renewal.
Section 105 of the Transfer of Property Act [for short,
`the TP Act'] defines "lease" of immovable property as "a
transfer of a right to enjoy such property, made for a
certain time, express or implied, or in perpetuity, in
consideration of a price paid or promised, or of money a
share of crops, service or any other thing of value, to be
rendered periodically or on specified occasions to the
transfer by the transferee,who accepts the transfer on such
terms". Therefore the lessor of immovable property by
contract in writing or otherwise can transfer his property
to the lessee to enjoy such property. It may be made for a
certain time, express or implied, or in perpetuity, in
consideration of a price or promised, or of money etc. and
the lessee accepts the transfer on such terms. Under Section
111 of the TP Act, a lease of immovable property determines,
inter alia, by efflux of the time limited. Section 116
envisages the effect of holding over and provides that "if a
lessee or under-lessee of property remains in possession
thereof after the determination of the lease granted to the
lessee, and the lessor or his legal representative accepts
rent from the lessee or under-lessee, or otherwise assents
to his continuing in possession, the lease is, in absence of
an agreement to the contrary, renewed from year to year, or
from month to month, according to the purpose for which the
property is leased, as specified in Section 106". Section
106 of the TP Act deals with the duration of certain leases
in the absence of written contract or local usage with which
we are not concerned in this case since the appellant and
the landlady are governed by the written lease. Since the
landlady had not accepted or asserted to the appellant's
continuance in possession, he cannot be treated under
Section 116 to be a tenant holding over.
Tenant at sufferance is one who comes into possession
of land by lawful title, but who holds it by wrong after the
termination of the term or expiry of the lease by efflux of
time. The tenant at sufferance is, therefore, one who
wrongfully continues in possession after the extinction of a
lawful title. There is little difference between him and a
trespasser. In Mulla's Transfer of Property Act [7th End.]
at page 633, the position of tenancy at sufferance has been
stated thus: A tenancy at sufferance is merely a fiction to
avoid continuance in possession operating as a trespass. It
has been described as the least and lowest interest which
can subsist in reality. It, therefore, cannot be created by
contract and arises only by implication of law when a person
who has been in possession under a lawful title continues in
possession after that title has been determined, without the
consent of the person entitled. A Tenancy at sufferance does
not create the relationship of landlord and tenant. At page
769, it is stated regarding the right of a tenant holding
over thus: The act of holding over after the expiration of
the term does not necessarily create a tenancy of any kind.
If the lessee remaining in possession after the
determination of the term, the common law rule is that he is
a tenant on sufferance. The expression "holding over" is
used in the sense of retaining possession. A distinction
should be drawn between a tenant continuing in possession
after the determination of the lease, without the consent of
the landlord and a tenant doing so with the landlord's
consent. The former is called a tenant by sufferance in the
language of the English law and the latter class of tenants
is called a tenant holding over or a tenant at will. The
lessee holding over with the consent of the lessor is in a
better position than a mere tenant at will. The tenancy on
sufferance is converted into a tenancy at will by the assent
of the landlord, but the relationship of the landlord and
tenant is not established until the rent was paid and
accepted. The assent of the landlord to the continuance of
the tenancy after the determination of the tenancy would
create a new tenancy. The possession of a tenant who has
ceased to be a tenant is protected by law. Although he may
not have a right to continue in possession after the
termination of the tenancy, his possession is
juridical.
The question then is what is the meaning of the
expression `lawful possession'. This was considered by this
Court in a leading decision on the right to grant licence
under the Cinematographic Act and Madras Cinemas Rules in
M.C. Chockalingam & Ors. v. V. Manickavasagam & Ors.,
[(1974) 2 SCR 143 at 152]. Rule 13 of the Madras Rules
required the licensee in lawful possession, when he had
applied for renewal after the expiry of the lease of the
licensee. The Court observed thus:
"Turning to rule 13, even in the first
part if the applicant for the licence is
the owner of the property he has to
produce before the licensing authority
the necessary records not only relating
to his ownership but also regarding his
possession. It is implicit, that the
owner having a title to the property, if
he can satisfy the licensing authority
with regard to his possession also, will
indeed be in `lawful possession',
although the word `lawful' is not used
in the first part. It is in that context
that the word `possession' is even not
necessary to be qualified by `lawful' in
the first part of rule 13. If, however,
the applicant for the licence is not the
owner, there is no question of his
showing title to the property and the
only requirement of the law is to
produce to the satisfaction of the
authority documentary evidence with
regard to his lawful possession of the
property. The word `lawful'. therefore,
naturally assumes significance in the
second part while it was not even
necessary in the first part. The fact
that after expiry of the lease the
tenant will be able to continue in
possession of the property by resisting
a suit for eviction, does not establish
a case in law slaw to answer the
requirement of lawful possession of the
property within the meaning of rule 13.
Lawful possession cannot be established
without the concomitant existence of
lawful relationship between the landlord
and the tenant. This relationship cannot
be established against the consent of
the landlord unless, however, in view of
a special law, his consent becomes
irrelevant. Lawful possession is not
litigious possession and must have some
foundation in a legal right to possess
the property which cannot be equated
with a temporary right to enforce
recovery of the property in case a
person is wrongfully or forcibly
dispossessed from it. This Court in Lalu
Yeshwant Singh's case (supra) had not to
consider whether judicial possession in
that case was also lawful possession. We
are clearly of opinion that juridical
possession is possession protected by
law against wrongful dispossession but
cannot per se always be equated with
lawful possession."
This decision has been followed in many subsequent
decisions of this Court. In Krishna Kishor Firm's case
(supra), this Court has considered the controversy in a
slightly different scenario. The facts therein were that the
appellant-firm while running the Cinema Theatre on a licence
granted pursuant to a lease by the landlords, one of the co-
owners had agreed to sell his share of the property and
another co-owner also entered separately into a lease. The
question therein was whether the possession was lawful
possession under the Rules. Giving various illustrations,
this Court held that the lawful possession means legal
possession which is also rightful or at least excusable.
Thus that which is not stricto legalo may yet be lawful. It
should not be forbidden by law. In fact "legal" is
associated with provisions in the Act, rules etc. whereas
"lawful" visualizes all that is not illegal, against law or
even permissible. "Lawful" is wider in connotation than
"legal". Although provisions in Specific Relief Act
empowering a person or tenant to recover possession if he
has been evicted forcibly by the landlord, may be juridical
and not lawful or a tenant holding over is not in lawful
possession unless landlord agrees or acquiesces in expressly
or impliedly but that does not alter the legal position
about possession of a person not legal yet not without
interest. In considering the Chockalingam's case, this Court
made a distinction between nature of the possession of the
lessee after the expiry of period of lease and the nature of
the possession of the lessee acquiesced in by the landlord.
In that context, it was pointed out that the lessee before
expiry of period of lease acquired lessor's entire interest
resulting in drowning or sinking of inferior right into
superior right. That is a right one of merger into another.
It has been separately recognised by Section 111(d) of the
TP Act. Similarly, a tenant after expiry of period of lease
may be holding over and the lessor may acquiesce in his
continuance, expressly or impliedly. That is from conduct
into lawful. The other may be where lessor may not agree to
renew the lease nor he may acquiesce in his continuance.
Such a lessee cannot claim any right or interest. His
possession is neither legal nor lawful. Such was the ratio
of Chockalingam's case.
In the backdrop of the factual position, law laid down
by this Court in Krishna Kishore Firm's case [supra]
requires to be understood. It is seen that one of the
lessors had entered into an agreement of sale with the
lessee to the extent of his share in the joint property and
some of the co-owners had also entered into a fresh lease to
the extent of their share in that property. The property
being joint and indivisible, in that backdrop this Court had
held that the possession of the appellant therein cannot be
considered to be unlawful. The ratio is clearly
distinguishable. Decision of this Court in Lalu Yeshwant
Singh's case [supra] also renders little assistance to the
appellant. Therein, the tenant had committed default in
payment of rent. The landlord instead of filing a suit for
ejectment of the tenant had taken law into his hands and had
the tenant forcibly ejected from possession. When he
approached the Court, this Court settled the legal position
that the landlord is not permitted to take forcible
possession except in due process of law and they must obtain
such possession as they are entitled through court of law as
the law recognised. The possession of a tenant who had
ceased to be a tenant, after expiry or termination of the
lease, is protected by law until he is duly ejected.
Although he may not have a legal right to continue in
possession after the termination of the tenancy or after the
expiry of the tenancy, his possession was at sufferance
recognised to be juridical and that possession is protected
by Common law.
Suppose a person trespasses into Government land and
remains in unlawful possession, whether he is liable to be
ejected under the Public Premises Act. Since Government has
not recognised the right of the trespasser to remain in
possession of the Government land, the Government is free to
take action as is available under law either under Public
Premises Act or appropriate law. But the Government cannot
forcibly eject the trespasser. In fact, this sort of
controversy had arisen in East India Hotels Ltd. case
[supra]. Therein, the licensor, after the fire had broken in
the premises, requested to give possession for effecting
repairers and the licensor was alleged to have promised to
give back possession to the licensee. Since the possession
was not redelivered, the licensee approached the High Court
under Section 6 of the Specific Relief Act, 1963 for
possession. The High Court granted decree for possession
until he was duly ejected. One of us [K. Ramaswamy, J.]
considered the entire case law including the cases cited by
Sri Lalit in the context of the power of the Court under
section 6 of the Specific Relief Act to grant decree for
possession for a licensee. It was held in para 44 that:
"Law respects possession even if there
is no title to support it. No one is
permitted to take law in one's own hands
and to dispossess the person in actual
settled possession without due course of
law. No person can be allowed to become
a judge in his own case. The object of
s.6 is to discourage people to act in
self-help, however, good their title may
be. The licensee in possession for well
over 15 years is in settled possession
and is entitled to remain in possession
and is entitled to remain in possession
and make use of the premises for the
purpose for which it was demised until
he is ejected in due course of law. The
acquiescence of the landlord in this
context would be to the initial unlawful
entry into possession and continuation
thereafter but not to the continuance in
possession of the licensee after the
expiry or termination of the licence.
That was what this Court appears to have
meant in the previous decisions. Take
for instance that when a licence was
granted for a couple of years and after
its expiry by efflux of time, or on
termination, if the possession of the
licensee, though unlawful and unjust is
not protected, the aggressor or mighty
would trample upon the right of the weak
and meek and denial of relief under s.6
would put a premium upon the aggression
or treachery or tricks. No doubt long
delay in disposal of cases due to docket
explosion became a ruse to unscrupulous
litigant to abuse the due course of law
to protract litigation and remain in
unjust or wrongful possession of
property. Landlord could be suitably
compensated by award of damages. It
cannot, by any stretch of imagination,
be said that a person in settled
possession, though unlawful, is not
entitled to the protection under s.6 of
the Act. Maintenance of law and order
and enthusing confidence in the efficacy
of rule of law are condition precedent
for orderly society. Therefore, giving
primacy, legitimacy or legality to the
conduct or acts of the landlord to take
possession of the property in derogation
of the due course of law would be
deleterious to rule of law and a pat on
high-handedness or self-help."
It was held that so long as the licensee has not been
evicted in execution of the decree lawfully obtained, his
possession under s.6 of the Act as a licensee is protected.
Section 6 can be availed of to recover possession until he
is lawfully dispossessed in due course of law.
In view of the settled position of law, the possession
of the appellant is as tenant at sufferance and is liable to
ejectment in due course of law. But his possession is not
legal nor lawful. In other words, his possession of the
theatre is unlawful or litigious possession. The appellant
may remain in possession until he is ejected in due course
in execution of the decree in the suit filed by the
respondent. His possession cannot be considered to be
settled possession. He is akin to a trespasser, though
initially he had lawful entry.
In this behalf, it is necessary to see even the
contract under which he was put in possession.
Para 22 & 23 of the contract reads thus:
22. "That the lessee shall quit the
scheduled properties on expiry of the
lease period and deliver possession of
the entire demised properties to the
Lessor including furniture installed by
the Lessors and other improvements,
alterations, constructions
reconstructions and additions effected
by the Lessees if any in good condition
subject only to the changes caused by
reasonable wear and tear and
irresistible force; that in default of
so quitting the premises, the Lessees
shall pay enhanced rent and damages at
the rate of Rs.100/-per day, till they
are evicted by the provisions of law by
the Lessor.
23. On expiry of the lease period, the
Lessees should sign all necessary
applications and papers and co-operate
to obtain transfer of all the licences
back in the name of Lessor or her
nominees promptly and also send all
necessary statements to the officers
concerned for the purpose or otherwise,
the Lessor gets every right to get all
the licences transferred in her name
automatically immediately after the
expiry of the Lease period."
A reading of these two covenants clearly manifests the
intention of the parties that after the expiry of the lease
he is enjoined to deliver possession of the demised premises
to the landlady.
After the expiry of the lease,he is treated to be in
unlawful possession, since he is required to pay damages for
use and occupation at the rate of Rs.100/- per day till he
is evicted in due course of law. Thereby it is clear that
his possession was not treated to be juridical possession
was not treated to be juridical possession but only
unlawful. He is required to pay damages for use and
occupation. Clause 23 indicates that on expiry of the lease,
the lessees should sign all necessary applications and
papers and cooperate with the lessor to obtain transfer of
all the licences. That would clearly indicate the intention,
namely, that the appellant shall remain in possession only
for the period of twenty years and thereafter his possession
becomes unlawful.
The High Court, therefore, was right in its conclusion
that the possession of the appellant is unlawful. The
learned Single Judge of the High Court [K. Ramaswamy, J., as
he then was] in M. Kameswara Somayajulu vs. State of A.P.
[1989 (1) APL] 82 (SN)] was not correct in his holding that
at the time of renewal, the licensee need not establish his
lawful possession due to omission in Rule 12(B) (1) which
was followed by another Division Bench. The Full Bench has
reconsidered the controversy. For different reasons given by
us, we think that the conclusion reached by the Full Bench
is correct.
The appeals are dismissed. No costs. The respondents
are entitled to withdraw the amount deposited by the
appellant pursuant to the interim order passed by this
Court.
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