The appellants/defendants have filed this Second Appeal as against the
judgment and decree dated 25.06.1998 made in A.S.No.16/1997, on the file of the
learned Principal Sub Judge, Madurai, confirming the judgment and decree, dated
29.11.1996, made in O.S.No.298/1981, on the file of the learned District Munsif,
Madurai.
2. The respondent/plaintiff has filed a suit seeking for the relief of
declaration and recovery of possession and past damages of Rs.50/- per month
from 12.12.1979 and also future damages at the rate of Rs.50/- per month.
Briefly, the case of the respondent/plaintiff is that she purchased the suit
property and other properties from one Ayyalu Naidu under a sale deed dated
22.08.1978 and it is in possession of the appellants/defendants, as lessee from
the plaintiff's vendor viz., Ayyalu Naidu. It is further stated in the
plaint that originally the suit property was under lease to one Govindaraja
Konar and he had sold the rice mill machineries and other accessories to the
defendants in January 1978 and these defendants thereafter attorned to the
plaintiff's vendor to then owner Ayyalu Naidu and was paying monthly rent of
Rs.50/-. A few days after the above said lease, the said Ayyalu Naidu borrowed
a sum of Rs.2000/- from the first defendant on 30.01.1978 and executed a simple
mortgage deed and also some arrangement between them, a sum of Rs.40/- was
adjusted towards interest due on the mortgage and 1st defendant was paying
Rs.10/- towards rent for the suit building. In the sale deed executed by Ayyalu
Naidu in favour of the plaintiff for a sum of Rs.19,000/-, the plaintiff, as
vendee, was directed to redeem the mortgage debt to the first defendant for
Rs.2,000/-. Hence, the plaintiff issued a notice to the first defendant to
suffer redemption of mortgage and receive the amount and return the mortgage
bond. Since the first defendant refused to receive the amount, the plaintiff
filed a suit for redemption of the said mortgage against the first defendant in
O.S.No.463/1979 in the Court of District Munsif, Madurai on 24.10.1979. Since
the first defendant not contested the case, a preliminary decree was passed on
23.04.1980.
3. It is further stated in the plaint that in the meantime, on 25.11.1979
and 23.02.1980, the plaintiff issued separate notices to the defendants through
her counsel and the defendants received the notices and sent reply through their
counsel on 12.12.1979 and 09.04.1980 wherein the defendants had deliberately and
willfully denied the plaintiffs title to the suit property and had also falsely
claimed as if there was an agreement between them. It is further stated that
the first defendant alone filed a suit for specific performance of the alleged
agreement in O.S.No.1079/1979 in the Court of Principal Subordinate Judge,
Madurai. Therefore, the plaintiff issued a notice to the first defendant on
13.02.1980 to vacate the premises removing the rice mill, as she had chosen to
deny the plaintiff's title.
4. According to the plaintiff the first defendant, as a lessee, is not
entitled to any notice to quit under Section 106 of Transfer of Property Act, as
she has deliberately and willfully denied the plaintiff's title of the suit
property. Since a notice of forfeiture would be necessary, a notice of
forfeiture and the tenancy rights was sent to the first defendant on 23.02.1980
and she received on 25.03.1980 and sent reply on 09.04.1980 to the above said
two notices through counsel. Since the second defendant also a co-lessee along
with the first defendant and as he had also denied the plaintiff's title in his
reply dated 12.12.1979 a notice of forfeiture was issued to the second defendant
also on 14.04.1980 and he had received on 17.04.1980. The alleged agreement
must have been brought about fraudulently in collusion with Ayyalu Naidu after
purchase of the property by the plaintiff and the said agreement is false. It
is further stated that, since the defendants had denied the title of the
plaintiff in the suit property, they have forfeited tenancy rights and it has
been indicated to them by proper notices. As they had also refused to attorn to
the plaintiff, a notice to quit under Section 106 of Transfer of Property Act,
become unnecessary. Therefore, the respondent/plaintiff has filed this suit.
5.Both the defendants have filed written statement in which it is admitted
that the defendants are lessee under vendor of the plaintiff and further stated
in the written statement that there was also a subsequent mortgage and latter
the first defendant entered into an agreement for sale on 26.07.1978 under which
the previous owner Ayyalu Naidu agreed to sell the property to the first
defendant for Rs.20,000/- and also received Rs.800/- as advance. It is also
averred in the written statement that Ayyalu Naidu with the active help and
connivance of the plaintiff and her husband appears to have brought a book about
subsequent sale deed purporting on 22.08.1978 with ante-dated particulars to
defeat the claims of the first defendant and therefore, the first defendant
filed a suit in O.S.No.1079/1979 to enforce the agreement dated 26.07.1978.
6.The defendants had further stated in their written statement that the
plaintiff has filed O.S.No.463/1979 for redemption of the mortgage dated
30.03.1978. It is further averred that when the defendants are in agreement
vendees and the plaintiff is not a bona fide purchaser, and therefore, the
defendants contested the above said suit. The plaintiff has fled another suit
in O.S.No.238/1980 for injunction to stop rice mill being run there on, but the
above suit is liable to be dismissed as barred under Order 2, Rule 2. The
plaintiff has filed another suit in O.S.No.935/1979 as against Ayyalu Naidu and
this defendant pleaded that it should be a collusive action. The defendants
have further stated in the written statement that all the notices issued by the
plaintiff are in valid in law and no notice has been given confirming to the
provisions of Transfer of Property Act and the plaintiff is not entitled to any
relief. It is further stated that the plaintiff cannot remove a rice mill
without State Government permission and hence and the suit is also barred by
non-joinder of Government as a party. The defendants have also filed additional
written statement and in which it is stated the the plaintiff admitted that
these defendants have been in possession and enjoyment of the suit property as
lessee from the plaintiff's vendor Ayyalu Naidu and the rate of interest of rent
was fixed at Rs.50/- per month and the first defendant filed the Suit in
O.S.No.1079 for specific performance of agreement and the present suit is filed
long after O.S.No.1079/1979 filed by the first defendant and it is not the case
of the defendants that the lease in favour of the defendants became seized to
exist by execution of agreement to sell and also not the case of the plaintiff
that by means of alleged purchase the tenancy came to an end. It is further
stated that the character of possession in none of the proceedings of the suit
property by the defendant was never in dispute and hence even assuming that the
plaintiff has purchased the suit property, it cannot and will not affect the
lease hold right created and enjoyed by these defendants prior to the date of
alleged purchase and further from the plaintiff's allegation, the defendants
are entitled to the protection of Rent Control Act and cannot be evicted except
under Provisions of Rent Control Act and further trial Court has no jurisdiction
and the defendants were always ready to pay the rent and therefore, the suit is
not maintainable.
7. On the side of the plaintiff has filed reply statement in which it is
stated that the defendants were informed by the plaintiff of her purchase of the
suit property even long prior to the filing of the suit but the defendants
failed to attorn to the plaintiff and in fact they denied the tenancy and also
title of the plaintiff to the suit property and therefore, issued notice for
forfeiture of tenancy to the defendants and requested them to remove the rice
mill and vacated the premises and handed over the possession to the plaintiff.
The defendants have also denied the allegation that the alleged tenancy cannot
and will not came into end under the law it is not admitted and as a fact, there
is no tenancy relationship between the plaintiff and the defendant and also
denied the allegation that the suit property come within the definition of the
Tamil Nadu Buildings (Lease and Rent Control) Act, 1960. Further, the above
said Act is not applicable to the Village, where the suit building was situated
and further, they are not entitled to the benefits of the Act, since they are
denied the relationship of tenancy and title of the plaintiff even prior to
filing of the suit and therefore, prayed for decreeing the suit with exemplary
costs.
8. The trial Court, considering the above said pleadings framed eight
issues including two additional issues and the plaintiff herself deposed as
P.W.1 and marked 15 documents as Exs.A1 to A15 and on the side of the
defendants, the second defendant had deposed as DW1 and marked 2 documents as
Exs.B1 and B2 and after considering the oral and documentary evidence, the trial
Court has decreed the suit.
9. Aggrieved over the same, both the defendants have preferred the first
appeal in A.S.No.16/1997 and the first appellate Court has dismissed the appeal
confirming the decree and judgment passed by the trial Court. Aggrieved over
the above said concurrent findings of both the Courts, both the defendants filed
this Second Appeal.
10. This Court admitted the Second Appeal and framed the following
Substantial Questions of Law for determination:-
"1.Whether the Courts below were right in holding that the defendants had
denied the title of the plaintiff to the suit property?
2.Whether the Courts below were in error in holding that no notice under
Sec.106 of Transfer of Property Act is necessary for determination of the lease?
3.Whether the Courts below erred in ignoring the requirement of Sec.106
C.P.C. that six months notice is required for lease for manufacturing purposes?"
11. The learned counsel for the appellants/defendants would contend that
both the trial Court and the appellate Court wrongly held that the defendants
denied the title of the plaintiff resulting in forfeiture of the rights as
tenants of the suit property and also failed to appreciate that the defendants
merely held a rival right to purchase the suit property and it did not mean that
the lease hold rights were denied and also both the Courts have failed to note
that the defendants never claimed to be in possession of the suit property under
assertion of their right to purchase under agreement and the defendants continue
to be in possession only pursuant to the lease under Ayyalu Naidu and therefore,
the conclusion of both Courts that the defendants have not attorned the tenancy
in favour of the plaintiff amounting to denial of title is perverse. The
learned counsel for the appellant further contended that the property purchased
by the plaintiff which clearly established that the plaintiff had never disputed
the relationship of land lord and tenant but only the plaintiff's right to
purchase the property and also specifically pleaded that there were lessees of
both the land and building under Ayyalu Naidu and therefore, the reasoning given
by both the Courts that the defendants were not entitled to any notice under
Section 106 of Transfer of Property Act is misconceived and illegal and also
both the Courts failed to note that the lease was for manufacturing purpose and
that the termination of tenancy can be only after giving six months notice to
quit.
12. Per contra, the learned counsel for the respondent/plaintiff would
contend that the appellants/defendants have admitted the vendor of the plaintiff
as landlord and the defendants 1 and 2 are lessees but subsequently the
appellants/defendants contended that as if the first defendant entered into an
agreement of sale on 26.07.1978 with the plaintiff's vendor Ayyalu Naidu and the
suit filed by the defendants on the basis of sale agreement is also dismissed
and falsely contended that as if the sale deed executed by vendor of the
plaintiff to the plaintiff is forged documents and also the
appellants/defendants have specifically denied the title of the plaintiff and
as per Section 111(g)(2) of Transfer of Property Act, the appellants/defendants
not entitled to any legal notice under Section 106 of Transfer of Property Act
and therefore, the suit filed by the respondent/plaintiff for the relief of
declaration and recovery of possession is maintainable and the contention of the
learned counsel for the appellants/defendants is not correct. Further, the
learned counsel for the respondent/plaintiff contended that the suit property,
both the land and building, originally owned by the said Ayyalu Naidu and the
respondent/plaintiff had purchased the above said property from the said Ayyalu
Naidu and the previous lessee viz., Govindaraja Konar only installed rice mill
and accessories and in the above said building, the defendants or their
predecessor viz., Govindaraja Konar has not doing any manufacturing business and
only running the rice mill in the above said building and it is not
manufacturing business and also contended that the suit property is in Village
and therefore, the benefits of Tamil Nadu Buildings Rent Control Act not
applicable to the respondent/plaintiff and both the Courts have discussed in
detail and correctly decreed the suit this appeal is not maintainable.
13. Admittedly, the suit property is belonged to one Ayyalu Naidu and one
Govindaraja Konar was lessee under him and in the year January 1978 the
appellants/defendants have purchased the machineries in the suit property and
attorned the plaintiff's vendor viz., Ayyalu Nadar as landlord and also admitted
that Ayyalu Nadar had executed a mortgage deed in favour of the first defendant
and therefore, it is not disputed that the defendants are lessees under the
original owner Ayyalu Naidu.
14. According to the respondent/plaintiff she purchased the suit property
from the original owner Ayyalu Naidu on 22.08.1978 under Ex.A3, registered sale
deed and in which it is directed to redeem the mortgage executed in favour of
first defendant and accordingly, issued notice to the first defendant for
redemption and since the defendants not received the notice, filed a suit in
O.S.No.463 of 1979 in the Court of District Munsif for redemption and
preliminary decree was passed on 24.08.1980. It is further contended on the
side of the respondent/plaintiff that she issued legal notice to terminate the
tenancy on 31.12.1979 and requested the defendants to vacate the premises on or
before 01.01.1980 and handover the possession and also not to apply licence
without permission from the plaintiff. Since the appellants/defendants had
sent a reply notice denying the sale deed as fraudulent documents and the
respondent/plaintiff has no right to redeem the mortgage, the
respondent/plaintiff again sent another notice under Ex.A12 dated 13.02.1980 by
stating that since the appellants/defendants denied the title, they have no
rights to possess and therefore, requested to handover the possession to the
plaintiff within one week. Since the appellants/defendants not handed over the
possession, respondent/plaintiff filed the suit for declaration, delivery of
possession and other reliefs.
15. The main contention of the appellants/defendants is that the
appellants/defendants are lessees under the predecessor of the plaintiff viz.
Ayyalu Naidu and therefore, the conclusion of both the Courts that the
appellants/defendants have not attorned the tenancy in favour of the
respondent/plaintiff amounting to denial of title is perverse and also both
Courts were wrongly held that the defendants were not entitled to any notice
under Section 106 of Transfer of Property Act is misconceived and illegal and
further contended that the lease was for manufacturing purpose and therefore,
the termination of tenancy only after giving six months notice to quit and
hence, the decree and judgment passed by the both courts are illegal.
16. The contention of the appellants/defendants that the alleged lease was
for manufacturing purpose and hence, the respondent/plaintiff is not entitled to
evict the appellants/defendants without giving six months' notice to quit is
absolutely not correct, since the appellants/defendants and their predecessor
viz., Govindaraja Konar not running manufacturing business in the above said
building and only running rice mill and therefore, as rightly contended by the
learned counsel for the respondent/plaintiff, not entitled to give six months
notice to quit, as contemplated under Section 106 of Transfer of Property Act.
17. The learned counsel for the appellants/defendants has contended that
the predecessor of the plaintiff i.e., Ayyalu Nadar alone as lessor and not
admitted the plaintiff as lessor and therefore, no landlord and tenancy
relationship between the respondent/plaintiff and appellants/defendants and
hence, as per Section 111(g)(2) of Transfer of Property Act, the
respondent/plaintiff is not entitled to any relief as prayed for in the suit.
In support of his contention, the learned counsel for the appellants/defendants
relied on two decisions, reported in AIR 1982 HIMACHAL PRADESH 29 (Tara Chand
Vs. Ishwar Dass and reported in 1984 (2) MLJ 432 (Ramaswami Panipoondar Vs.
Mani).
18. In the first decision reported in AIR 1982 HIMACHAL PRADESH 29 (cited
supra) in paragraph 13, reads as under:-
13. From the above facts it is clear that the plaintiffs have nowhere
accepted the defendant as a tenant of the disputed property and have in fact
treated the defendant as a trespasser. The plaintiffs have also not alleged in
the plaint that by denial of title of the plaintiffs, the defendant has
forfeited the tenancy rights. An indirect averment has been made in the plaint
that if the defendant is proved to have been inducted as a tenant by the
mortgagees then the said creation of the tenancy in favour of the defendant is
mala fide and is not binding on the plaintiffs. Hence the plaintiffs' suit is on
the grounds (a) that defendant was never inducted as a tenant by the plaintiffs;
(b) that after the redemption of the mortgage the defendant's tenancy rights, if
any, have come to an end. The defendent on the the other hand has set up a
tenancy with respect to the disputed land and had alleged that he has acquired
status of a permanent occupancy tenant on the land. The only avermenc of the
defendant in the written statement is that as he was a permanent occupancy
tenant of the suit land of 15th June, 1952 therefore, by virtue of the Punjab
Act 8 of 1953, he has acquired ownership rights. The next averment of the
defendant that he has acquired a title by adverse possession is also based upon
the fact that as he had been vested with ownership rights on 15-6-1952 by virtue
of the provisions of the Punjab Act 8 of 1953, therefore, he has become owner by
adverse possession from 15-6-1952. If the written statement of the defendant is
read as a whole, then it cannot be said that the defendant was denying his
status as a tenant under the plaintiffs. On the other hand the defendant was all
along claiming himself to be a tenant of the plaintiffs and was accepting his
status as a tenant and was claiming ownership simply on the ground of an
enactment. There is no allegation in the plaint that the defendant had denied
the tenancy earlier to the institution of the suit and there is further no
allegation in the plaint that the defendant was ever a tenant of the plaintiffs.
In view of these circumstances that the defendant was never accepted as a tenant
by the plaintiffs, there is no question of denying the title of the plaintiffs.
For applying the provisions of Section 111 (g), T. P. Act the plaintiffs should
first have accepted the existence of relationship of landlord and tenant and
then should have claimed the possession on the ground of forfeiture of tenancy
by denial of title. In the present case this is not the position. On the other
hand the defendant is claiming tenancy rights and has stated in his written
statement that he had been paying rent to the plaintiffs in the year 1964 also,
which rent was accepted by the plaintiffs. In view of the aforesaid
circumstances, it cannot be said ;that the defendant loses his tenancy rights by
denial of the tenancy....."
19.The learned counsel for the appellants/defendants also relied on an yet
another decision reported in (1984 (2) MLJ 432) (cited supra) wherein in
paragraph 13, reads as under:-
13.A technical plea has been raised by the first defendant by stating
that the suit must fail for want of proper notice to quit. In the written
statement filed, except for a stray sentence that the suit must fail for want of
proper notice to quit, there is no amplification of the ground on which the
notice to quit is required. However, Mr. G. Subramanian, learned Counsel for the
first defendant would submit that the plaintiff himself characterised the first
defendant as a tenant and hence, even assuming that the first defendant set up
title in himself, there ought to have been a determination of the lease under
Section 111(g), Clause (2) of the Transfer of Property Act. The facts disclosed
do not justify the projection of such a theory at all. The suit is not based on
tenancy. The suit has been filed for declaration of title and for recovery of
vacant possession. The plaintiff never claimed that the first defendant was his
tenant at any point of time. The first defendant also never admitted that he was
a tenant under the plaintiff at any point of time. It is true that in the plaint
there is a reference that the first defendant was a tenant under the vendor of
the plaintiff. But, it has been categorically averred that the first defendant
and the vendor of the plaintiff agreed to dismantle the shed and vacate the land
within three months from the date of the sale in favour, of the plaintiff,
thereby clearly suggesting that any alleged erstwhile relationship based on
tenancy between the vendor of the plaintiff and the first defendant agreed to be
put an end to and the first defendant agreed to vacate the land, as stated
above. The plaintiff could not be stated to have alleged or admitted that the
first defendant continued in possession as his tenant after the plaintiff's
purchase. The first defendant never came anywhere near this case of tenancy
under the vendor of the plaintiff. To attract Section 111(g) of the Transfer of
Property Act, there ought to have been an indisputable relationship or lessor
and lessee at some point of time or other and subsequently, the lessee ought to
have renounced his character as such, setting up title in a third person or by
claiming title in himself. Where, from the very inception there was no admission
on either side of the existence of the relationship of lessor and lessee and the
parties were always at grips and loggerheads, each one claiming independent
title in himself, as against the other, there is no scope for coming anywhere
near Section 111(g) of the Transfer of Property Act. Such are the facts of the
present case. The first defendant never admitted that he was put in possession
of the suit property by the plaintiff's vendor as a lessee and there was an
attornment of tenancy by him in favour of the plaintiff on the latter's
purchase. Hence, the plea with regard to lack of notice to quit is a
misconception on the facts of the present case.
20.A perusal of the above said decisions would reveal that they are not
applicable to the facts of the present case. Therefore, the facts of the above
said two decisions relied on by the learned counsel for the appellant are not
applicable to the present case.
21. In the instant case, as rightly pointed out of the learned counsel for
the respondent/plaintiff, the tenancy between the vendor of the plaintiff and
the defendants are admitted and also the respondent/plaintiff has proved that
she purchased the suit property under a valid sale deed from the vendor of the
plaintiff and after purchase, issued legal notice to the defendants as lessees
under the predecessor but the appellant/defendants have categorically denied the
tenancy relationship in the reply notice and also denied the title of the
plaintiff/respondent by contending that the sale deed executed by the vendor of
the respondent/plaintiff is forged documents and also claimed title to the
appellants/defendants under sale agreement.
22.Further, with regard to Rights of lessors transferee, it is relevant to
refer Section 109 of Transfer of Property Act, reads as under:-
"109. Rights of lessor's transferee:- If the lessor transfers the property
leased, or any part thereof, or any part of his interest therein, the
transferee, in the absence of a contract to the contrary, shall possess all the
rights, and, if the lessee so elects, be subject to all the liabilities of the
lessor as to the property or part transferred so long as he is the owner of it;
but the lessor shall not, by reason only of such transfer cease to be subject to
any of the liabilities imposed upon him by the lease, unless the lessee elects
to treat the transferee as the person liable to him;
Provided that the transferee is not entitled to arrears of rent due before
the transfer, and that, if the lessee, not having reason to believe that such
transfer has been made, pays rent to the lessor, the lessee shall not be liable
to pay such rent over again to the transferee.
The lessor, the transferee and the lessee may determine what proportion of
the premium or rent reserved by the lease is payable in respect of the part so
transferred, and in case they disagree, such determination may be made by an
Court having jurisdiction to entertain a suit for the possession of the property
leased."
23. It is relevant to refer Section 111(g) of Transfer of Property Act,
which reads as follows:-
111.Determination of lease:- A lease of immovable
property determines--
(a) ......
(b) ......
(c) ......
(d) ......
(e) ......
(f) ......
"(g) by forfeiture; that is to say, (1) in case the lessee breaks an
express condition which provides that, on breach thereof, the lessor may re-
enter or (2) in case the lessee renounces his character as such by setting up a
title in a third person or by claiming title in himself; or (3) the lessee is
adjudicated an insolvent and the lease provides that the lessor may re-enter on
the happening of such event]; and in [any of these cases] the lessor or his
transferee [gives notice in writing to the lessee of] his intention to determine
the lease;"
24. A careful reading of the above said Section 111(g) and the facts of
the present case reveal that the appellants/defendants is not entitled to any
legal notice under Section 106 of Transfer of Property Act and even then the
respondent/plaintiff has issued legal notice under Exs.A7 and A.12, dated
25.11.1979 and 23.02.1980 respectively and therefore, the respondent/plaintiff
is entitled to the relief of declaration, recovery of possession and other
reliefs.
25. From the above said discussion, the trial Court as well as the first
appellate Court have correctly held that the appellants/defendants had denied
the respondent/plaintiff's title to the suit property and therefore, no notice
under Section 106 of Transfer of Property Act is necessary for determination of
lease and also correctly held that six months' notice under Section 106 of
Transfer of Property Act is not necessary, since it is not proved that lease
was manufacturing purposes and therefore, both the courts below have correctly
granted the relief to the respondent/plaintiff and no need to interfere with the
above said concurrent findings of both Courts. From the forgoing discussions,
the Substantial Questions of Law are answered accordingly.
26. In the result, the Second Appeal is dismissed with costs, confirming
the judgment and decree dated 25.06.1998 made in A.S.No.16/1997 on the file of
the Principal Sub Court, Madurai, and confirming the judgment and decree, dated
29.11.1996 made in O.S.No.298/1981, on the file of the District Munsif Court,
Madurai.
MPK
To
1. The Principal Sub Judge,
Madurai.
2.The District Munsif,
Madurai.