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  • R.M.S Khandeparkar, J.
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Smart Summary

Judgment Summary — R.M.S. Khandeparkar, J.

Factual and Procedural Background

This appeal challenges the judgment dated 21 March 1998. The appellant complained that the courts below wrongly construed an Agreement dated 1 May 1973 as a licence when, he contended, it ought to have been construed as a lease. The appellant maintained that despite its description as a "leave and licence" the agreement created leasehold rights. The appellant relied upon several precedents to support this contention.

The respondent disputed that the question of law relied upon by the appellant arose, submitting that the appellant had not based his defence on creation of a lease by the document but had only asserted that the document, though styled as a leave and licence, was intended to be a lease. The respondent relied upon Swarn Singh v. Madan Singh (1995 Supp (1) SCC 306).

The defendant/appellant's pleadings (written statement) expressly stated (quoted in the opinion) that although the agreement was styled as a leave and licence, it was intended to be a lease, the duration being at the defendant's option; and that the lease was intended to continue for successive periods of eleven months at the option of the defendant and not for four periods of eleven months as alleged by the respondent. The trial court interpreted the document on the basis of the entire record; the High Court entertained the second appeal challenged here.

Legal Issues Presented

  1. Whether the Agreement dated 1 May 1973 — though styled a "leave and licence" — should be construed as a lease.
  2. Whether the courts below erred in their construction of the document and, if so, whether the High Court in second appeal is entitled to correct such misconstruction.
  3. Whether the interpretation of the document by the trial court gives rise to a substantial question of law for consideration in this appeal.

Arguments of the Parties

Appellant's Arguments

  • The courts below wrongly construed the Agreement dated 1 May 1973 to be a licence when, applying legal principles, it ought to be construed as a lease.
  • The legal effect of the Agreement is to create a document of lease notwithstanding its description as "leave and licence".
  • The appellant relied on several precedents (listed below) to support the contention that the document should be treated as a lease.

Respondent's Arguments

  • The proposed question of law does not arise because the appellant had not pleaded that a lease was created in his favour by the document; rather the appellant's case was that the document, though styled as leave and licence, was intended to be a lease.
  • The respondent relied upon Swarn Singh v. Madan Singh (1995 Supp (1) SCC 306) and drew attention to the parties' pleadings to show that the contention urged by the appellant did not raise the legal question submitted.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Bhusawal Borough Municipality v. Amalgamated Electricity Co. Ltd., Bhusawal, A.I.R 1966 S.C 1652 The opinion treats this Apex Court decision as one of the authorities holding that misconstruction of a document which is not merely evidentiary but is the basis of a party's claim is an error of law correctible in a higher forum. The court held the facts to be fully covered by this authority and relied on it to state the principle that such misconstruction is an error of law which the High Court in a second appeal may correct.
Swarn Singh v. Madan Singh, 1995 Supp (1) SCC 306 The opinion cites this authority for two principles stated in the judgment: (a) misconstruction of a document which is the basis of a claim is an error of law correctible in appeal; and (b) when a document is unambiguous, one need not go beyond the document to consider attendant circumstances or party intentions. The court relied on this decision and emphasized that because the document in question is unambiguous, there was no need to look beyond it; the principles in Swarn Singh supported dismissal of the appeal.
Capt. B.V D'Souza v. Antonio Fausto Fernandes, (1989) 3 SCC 574 : A.I.R 1989 S.C 1816 This precedent was cited by the appellant; the opinion does not specify within the text the exact rule or principle from this case relied upon. The court noted the precedent was relied upon by the appellant but later observed that the other judgments relied upon were not attracted in the facts of this case.
Associated Hotels Of India Ltd v. R.N Kapoor, A.I.R 1959 S.C 1262 The opinion lists this authority as relied upon by the appellant but does not state the specific principle cited from it. The court recorded that this judgment was among those relied on by the appellant but held that the other judgments (besides Bhusawal and Swarn Singh) were not attracted to the facts.
Parmatma Prasad v. Mt. Sampatti, A.I.R 1968 Allahabad 184 The opinion includes this High Court decision among the authorities cited; no specific rule from it is stated in the opinion. The court observed such authorities had been cited but concluded they were not applicable to the present facts.
Kidar Nath v. Swami Parshad, A.I.R 1978 Punjab and Haryana 204 The opinion records this citation but does not spell out a specific principle from this case in the text. The court treated this among the other authorities that were not attracted by the facts of the instant case.
Balvantsingji Anand v. Bhagwantrao Ganpatrao Deshmukh, A.I.R 1980 Bombay 333 The opinion lists this Single Judge decision as cited; no particular principle from it is described in the opinion. The court noted the citation but found it not to be attracted by the facts before it.
Permanand Gulabchand and Co. v. Mooligi Visanji, A.I.R 1990 Kerala 190 This Kerala High Court decision was cited; the opinion does not identify a stated rule or principle taken from it. The court indicated that this judgment had been relied upon but concluded it was not attracted to the facts of the present case.

Court's Reasoning and Analysis

The court proceeded as follows, based solely on the record and arguments documented in the opinion:

  1. On hearing counsel and perusal of the record, the court observed that the Agreement dated 1 May 1973 on its face was a "leave and licence" agreement.
  2. The appellant's pleaded case (paragraphs 6 and 8 of the written statement) expressly admitted the document was styled as a leave and licence but asserted it was intended to be a lease, with duration at the defendant's option and to continue for successive periods of eleven months at the defendant's option.
  3. The court identified two Apex Court decisions—Bhusawal Borough Municipality v. Amalgamated Electricity Co. Ltd. and Swarn Singh v. Madan Singh—as directly relevant. Those decisions establish that a misconstruction of a document, when the document is the basis of a party's claim, amounts to an error of law which a High Court in a second appeal may correct.
  4. Applying those principles, the court examined whether the interpretation given by the trial court to the document amounted to such a misconstruction. The court reasoned that the appellant had not pleaded that a lease was created in his favour by the agreement; rather, the appellant relied upon the document to support his claim to leasehold rights. Given that posture, the court concluded the trial court's interpretation—arrived at after analysing the entire record—did not amount to a misconstruction giving rise to a substantial question of law.
  5. The court further invoked Swarn Singh to underscore that where a document is unambiguous, there is no occasion to look beyond the document to attendant circumstances or to attempt to import the parties' intended but unstated intentions.
  6. Finally, the court observed that the other precedents relied upon by the appellant were not attracted by the facts and circumstances of this case.

Holding and Implications

APPEAL DISMISSED.

Consequences and immediate effects:

  • The High Court upheld the interpretation given by the courts below and found no substantial question of law arising from the interpretation of the Agreement dated 1 May 1973 in the circumstances of this case.
  • The appeal is dismissed, resulting in no change to the outcome reached by the courts below.
  • The opinion does not purport to lay down any new broad legal principle beyond applying the cited authorities (in particular Bhusawal and Swarn Singh) to the facts: it records that the other authorities relied upon by the appellant were not attracted to this case.

This summary is confined to the contents and reasoning expressly contained in the provided opinion and does not add or infer facts or legal propositions beyond that text.

Show full summary ...

    Shri Paulo Godinho v. Shri Hari Jaivant Sinai Bhangui .

    R.M.S Khandeparkar, J.:— This is an appeal against the judgment dated 21st March 1998 complaining that the courts below have wrongly construed the Agreement dated 1st May 1973 to be a licence when in fact upon application of legal principles it ought to have been construed as lease. It is further contended by the appellant that the legal effect of the agreement is to create a document of lease, notwithstanding its description as leave and licence and, therefore, the conclusions arrived at by the impugned judgments are based on misreading of the Agreement dated 1st May 1973 and by non-application of the correct principles of law. In support of these contentions Shri Mahesh S. Sonak, learned advocate appearing for the appellant sought to rely upon the judgment of the Apex Court in the matter of (Bhusawal Borough Municipality v. Amalgamated Electricity Co. Ltd., Bhusawal)1, reported in A.I.R 1966 S.C 1652, in the matter of (Capt. B.V D'Souza v. Antonio Fausto Fernandes)2, reported in (1989) 3 SCC 574 : A.I.R 1989 S.C 1816, as well as in the matter of (Associated Hotels Of India Ltd v. R.N Kapoor)3, A.I.R 1959 S.C 1262 and of the High Courts in the matter of (Parmatma Prasad v. Mt. Sampatti)4, reported in A.I.R 1968 Allahabad 184 and in the matter of (Kidar Nath v. Swami Parshad)5, reported in A.I.R 1978 Punjab and Haryana 204, of a Single Judge of our High Court in the matter of (Balvantsingji Anand v. Bhagwantrao Ganpatrao Deshmukh)6, reported in A.I.R 1980 Bombay 333, and of the Kerala High Court in the matter of (Permanand Gulabchand and Co. v. Mooligi Visanji)7, reported in A.I.R 1990 Kerala 190. As against this Shri Sudesh M. Usgaonkar; appearing for the respondent, has submitted that in the facts and circumstances of the case the proposed consideration of law does not arise at all particularly in view of the fact that the appellant had not based his defence on the document dated 1st May 1973 and the contention of the appellant was that the said agreement though styled as leave and licence was intended to be the lease agreement. In that regard the learned Advocate drew my attention to the pleadings of the plain tiff/respondent herein as well as those of the defendant/appellant and sought to rely upon the judgment of the Apex Court in the matter of (Swarn Singh v. Madan Singh.)8, reported in 1995 Supp (1) SCC 306.

    2. Upon hearing the Advocates for the parties and on perusal of the records, it is seen that the agreement in question on the face of it discloses it to be a leave and licence agreement and it was a specific case of the appellant that though the said agreement was styled as leave and licence agreement, the same was intended to be a lease, the duration of which was at the option of the defendant and further that the said leave agreement was intended to continue for successive periods of 11 months at the option of the defendant and not for four periods of 11 months as alleged by the respondent.

    3. In fact, the relevant pleadings in that regard are to be found in paragraphs 6 and 8 of the written statement, which read as under:—

    “6. For reasons stated in the preceding para, the contents of para 5 of the plaint are denied to the extent they are inconsistent with the case of defendant. The defendant submits that though the said agreement is styled as leave and licence agreement, the same was intended as lease the duration of which was at the option of the defendant.

    8. With reference to para 7 of the plaint, the defendant wish to clarify that the lease agreement was intended to continue for successive periods of eleven months at the option of the defendant and not for 4 periods of 11 months as falsely alleged.”

    4. Considering the facts and circumstances of the case, the same is fully covered by the judgments of the Apex Court in two cases, namely, one in the matter of Bhusawal Borough Municipality v. Amalgamated Electricity Co. Ltd., Bhusawal (supra) relied upon by the appellant himself and the other in the matter of Swarn Singh v. Madan Singh. (supra) wherein it has been held that the misconstruction of a document which is not merely of evidentiary value but one upon which the claim of a party is based would be an error of law and the High Court in second appeal would be entitled to correct it. As already seen above the case of the appellant was not that the lease was created in his favour by virtue of the agreement dated 1st May 1973 but the said document was sought to be relied upon in support of his case that he is the leaseholder in respect of the suit property and being so, it cannot be considered as a misconstruction of the document upon which the appellant had based his defence of leasehold right to the suit property and, therefore, the interpretation of a document which has been done by the trial Court on the basis of analysis of the entire materials on record cannot be considered as giving rise to any substantial question of law in relation to the interpretation of the document in question. Besides, it is the case of the appellant himself that the document was styled as leave and licence agreement but it was intended to be a lease agreement. In the background of such plea, it cannot be said that the interpretation of such document can be a misconstruction of the same. It has been clearly held by the Apex Court in Swarn Singh v. Madan Singh. (supra) that when the document is unambiguous, there is no need to travel beyond the document and look at attendant circumstances together with the intention of the parties. As regards the other judgments relied upon, the same are not at all attracted in the facts and circumstances of this case. Since no other substantial question of law arise for consideration, the appeal is dismissed.

    5. Appeal dismissed.

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    Comments

    Shri Paulo Godinho v. Shri Hari Jaivant Sinai Bhangui .
    (Nov 20, 1998)