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Smart Summary

Factual and Procedural Background

The Municipal Corporation of Delhi (the Corporation) held an auction on 21st October 1973 for the allotment of Kiosks near the Red Fort, Delhi. The petitioners were the highest bidders and were allotted Kiosks as licensees for a period of 11 months starting 1st November 1973. One petitioner, Chandu Lal, deposited security, took possession, and carried on business under the license. Upon expiry of the license period on 30th November 1974, he sought an extension, which the Corporation initially recommended but later rejected. Subsequently, officials of the Corporation threatened eviction, which the petitioner resisted, alleging illegal and arbitrary actions. The petitioners filed suits seeking permanent injunctions restraining the Corporation from dispossessing them and applied for interim injunctions under Order 39, Rules 1 and 2 read with section 151 of the Code of Civil Procedure, 1908.

The Corporation challenged the suits on grounds including lack of jurisdiction, barred suit under sections 477 and 478 of the Delhi Municipal Corporation Act, 1957, and maintained that no renewal or extension of licenses occurred. The trial courts initially granted ex parte injunctions but later vacated them, dismissing the petitioners’ applications. Appeals were dismissed by the Senior Sub-Judge, Delhi. The petitioners then filed civil revision petitions challenging the appellate orders.

The petitioners later amended their plaint to assert that the so-called license deed was in fact a lease deed, conferring an interest in the property and exclusive possession. The courts below had disposed of injunction applications based on the original plaint, not the amended one. The matter was referred to a larger Bench due to the legal complexity and importance of the questions raised.

Legal Issues Presented

  1. Whether the document executed between the Corporation and the petitioners constituted a lease or a license.
  2. Whether the petitioners, as licensees or purported lessees, were entitled to protection from eviction and to maintain possession of the Kiosks.
  3. Whether the Corporation had the legal authority under the Delhi Municipal Corporation Act, 1957, to grant a license as opposed to a lease.
  4. Whether the petitioners were entitled to interim injunctions restraining their dispossession pending suit disposal.

Arguments of the Parties

Petitioners' Arguments

  • The so-called license deed was in fact a lease deed, intended to create a tenancy interest in the Kiosks.
  • The petitioners had exclusive possession and control over the Kiosks to carry on their business without restrictions, indicating tenancy rather than mere license.
  • They were protected under the provisions of the Delhi Rent Control Act, 1958, and could not be summarily evicted.
  • The Corporation’s acceptance of license fees after the alleged revocation indicated acquiescence in their possession.
  • The Corporation was not entitled to forcibly evict them and must follow due legal process.
  • Under sections 197 and 201 of the Delhi Municipal Corporation Act, the Corporation could only grant leases and not licenses; any license granted was ultra vires.
  • Possession was settled and lawful, entitling them to defend possession even against the owner.

Corporation's Arguments

  • The suit was barred under sections 477 and 478 of the Delhi Municipal Corporation Act, 1957.
  • The petitioners had no locus standi and the suit was not maintainable.
  • The allotment was only for 11 months as a license, with no renewal or extension granted.
  • The petitioners were required to vacate the Kiosks on expiry of the license period.
  • The Corporation had legal authority to grant only licenses and not leases under the Act.
  • The Corporation’s right to repossess the Kiosks was lawful and the petitioners had no legal possession or interest.
  • Granting interim injunction would cause irreparable harm to the Corporation as it had called for fresh tenders.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Associated Hotels of India v. R.N Kapur, AIR 1959 S.C 1262 Exclusive possession does not necessarily create tenancy if intention negates tenancy. Supported the principle that the intention of the parties is determinative in distinguishing license from lease.
Dominion of India v. R.B Sohan Lal, AIR 1950 H.P 40 A bare license is a personal privilege, revocable even if given for valuable consideration. Confirmed that petitioners held only a license and not tenancy rights.
Satwant Singh Sawhney v. D. Ramarathnam, AIR 1967 S.C 1836 Licensee does not acquire interest in property; possession alone does not confer tenancy. Supported the finding that petitioners were licensees without tenancy rights.
R.N Ditta v. M/s. Dunlop Rubber Co. (India) Ltd., AIR 1968 S.C 175 Distinction between license and lease based on transfer of interest and right to possession. Reinforced that petitioners’ rights were limited to license only.
Munshi Ram and others v. Delhi Administration, AIR 1968 S.C 702 Right of owner to re-enter property and resist trespassers with reasonable force. Supported Corporation’s right to repossess Kiosks without excessive force.
Board of Revenue etc. v. A.M Ansari etc., AIR 1976 S.C 1813 Creation of interest in immovable property distinguishes lease from license; intention inferred from circumstances. Affirmed that the deed was a license, not a lease, based on intention and circumstances.
Satibhusan Mukherjee v. The Corporation of Calcutta, AIR 1949 Calcutta 20 Doctrine of ultra vires limits powers of statutory corporations to acts expressly or impliedly permitted. Rejected petitioners’ argument that Corporation could not grant licenses under the Act.
Puran Singh and others v. The State of Punjab, AIR 1975 S.C 1674 Possession without title may be protected until lawful eviction. Distinguished on facts; petitioners had no legal possession as licensees.
Lallu Yeshwant Singh (dead) by his legal representatives V. Rao Jagdish Singh and others, AIR 1968 S.C 620 Unauthorised occupant can be evicted only in manner authorised by law. Held inapplicable as petitioners were licensees and not tenants.
Madan Mohan Lal v. State Of Punjab, 1970 R.C.J 95 Tenancy rights require legal possession; unauthorized occupants lack such rights. Distinguished on basis of tenancy rights not being established.
Delhi Simla Catholic Archdiocese v. The State of Uttar Pradesh and others, AIR 1976 Delhi 251 Right of State as landlord to seek forcible eviction where lessees exist. Distinguished as petitioners were licensees, not lessees.
The Managing Director (MIG) Hindustan Aeronautics Ltd. v. Ajit Prasad Tarway, AIR 1973 S.C 76 Limits on High Court’s powers of revision under section 115 of the Code of Civil Procedure. Supported dismissal of revision petitions for lack of jurisdictional error.

Court's Reasoning and Analysis

The Court analyzed the nature of the document between the Corporation and the petitioners, focusing on whether it created a leasehold interest or merely a license. It emphasized that the intention of the parties, discerned from the terms and surrounding circumstances, is decisive. The Court noted that although exclusive possession is prima facie indicative of tenancy, the presence of terms negating tenancy and showing a personal privilege creates a license instead.

The Court examined the auction terms and the deed clauses, which indicated that the petitioners were granted a license for 11 months with no transferable or heritable rights, subject to cancellation without reason by the Corporation. The legal possession remained with the Corporation, and the petitioners’ possession was lawful only by virtue of the license.

The Court rejected the petitioners' contention that the document was a lease, holding that no interest in the property was created in their favor. It held that the Corporation had the legal right to repossess the Kiosks upon license expiry or revocation and that repossession by self-help did not amount to unlawful eviction, provided reasonable force was used.

The Court further dismissed the argument that the Corporation lacked power to grant licenses under the Delhi Municipal Corporation Act, 1957, observing that ownership confers the right to enjoy property and to grant licenses to generate income.

Regarding interim injunctions, the Court noted that petitioners failed to establish a legal right to possession or a prima facie case. Since the petitioners were licensees and not tenants, they had no right to resist lawful repossession by the Corporation. The Court found no error in the dismissal of injunction applications by the courts below.

Holding and Implications

The petitions are dismissed.

The Court held that the document executed between the Corporation and petitioners was a license deed, not a lease, and thus no tenancy rights or interest in the Kiosks were created in favor of the petitioners. Consequently, the petitioners were not entitled to retain possession beyond the license period nor to injunctions restraining eviction. The Corporation was entitled to repossess the Kiosks upon expiry or revocation of the license using reasonable force without being deemed to have acted unlawfully.

The decision directly affects the parties by affirming the Corporation’s right to terminate licenses and repossess the Kiosks without legal impediment from the petitioners. No new legal precedent was established beyond the application of settled principles distinguishing licenses from leases and the powers of statutory corporations under their enabling statutes.

    Chandu Lal Etc. Petitioners v. Municipal Corporation Of Delhi

    Prithvi Raj, J.:— Since common questions of law and facts are involved in these civil revision petitions, it would be appropriate to dispose them of by a single judgment.

    2. Briefly stated the facts pertaining to these revision petitions are as follows. The Municipal Corporation of Delhi (herein called ‘the Corporation’) held an auction on 21st October, 1973, for allotment of Kiosk situated near Bus Stop, Parade Ground, opposite Red Fort, Delhi. The petitioner were the highest bidders and consequently each one of them was allotted a Kiosk. Chandu Lal's bid was for Kiosk bearing No. 1. The Corporation accepted his bid for Rs. 450/- per month in respect of the said Kiosk and allotted the same to him as a licensee for a period of 11 months commencing from 1st November, 1973. His case is that in pursuance of the terms of the license he deposited the security amount equivalent to three month's fee and took the physical possession of the Kiosk on 1st January, 1974. He further contends that he had been peacefully carrying on his business in the said Kiosk in accordance with the rules and regulations of the Corporation; that on the expiry of the period of license on 30th November, 1974, he made a representation to the Commissioner of the Corporation for the extension of license period and that on the recommendation of the Commissioner for the extension of the period of the license for a full term of five years in pursuance of the renewal and extension of the license period, the Corporation accepted the license fee subsequently after 30th November, 1974. However, the petitioner alleges that on 29th May, 1975, some officials of the Corporation came at the site and threatened him to vacate the Kiosk on which he told the said officials that he had been regularly paying the license fee, as such he could not be evicted arbitrarily and in an illegal manner. It is also alleged that on the threatened action of the officials of the Corporation, nearby shopkeepers collected there and with a great difficulty the said officials were persuaded not to take law in their own hands on which the officials retreated. He, however, contends that an imminent and recurring threat at their hands at any time subsists. Describing the action of the Corporation as manifestly illegal, arbitrary, mala fide and discriminatory, the petitioner filed the suit for the grant of a decree for permanent injunction restraining the Corporation from interfering disturbing or dispossessing him from the Kiosk. The petitioner also filed an application under Order 39, Rules 1 and 2 read with section 151 of the Code of Civil Procedure. 1908, praying that pending disposal of the suit the Corporation be restrained by way of ad interim injunction from interfering, disturbing or dispossessing him from the above-said Kiosk.

    3. The Corporation in its written statement by way of preliminary objections urge that the suit is barred in view of sections 477 and 478 of the Delhi Municipal Corporation Act, 1957, (herein called ‘the Act’); that the petitioner has no locus standi to file the suit; and that the suit as framed is not maintainable. On merits the Corporation admits that the petitioner being the highest bidder was allotted the Kiosk in question for 11 months as a licensee; that on the expiry of the said period the petitioner was asked to vacate the Kiosk; that his request for the extension of the period of license for a further period of five years was rejected as it was not found possible to extend the period; that the order rejecting the prayer for extending the period was communicated to the petitioner vide letter dated 8th May, 1975; and that thus there was neither any renewal nor extension of the license period as alleged by the petitioner. The Corporation accordingly contends that since the license was for a period of 11 months, the petitioner was bound to vacate the Kiosk on the expiry of the said period. In the premises it is prayed that the Court had no legal jurisdiction to try the suit and that for the aforesaid reasons the suit be dismissed.

    4. The application for the grant of ad interim injunction is resisted on the grounds already noted above. It is contended that the grant of stay would result in immense damage to it in that it had already called tenders and that it was bound to hand over possession to the person who is the highest bidder in the said tender.

    5. It may bear mention here that the petitioner subsequently with the leave of the Court amended the plaint on 26th November, 1976, by incorporating the plea that the document dated 11th December, 1973, executed between the parties though described as a license deed was in fact a lease deed in that the intention of the parties was to create a lease of the Kiosk and that by the document in question an interest was created in the Kiosk in favour of the petitioner in recognition of which right, physical possession and control of the Kiosk was delivered to and continues to vest in the petitioner.

    6. It may also be noted here that the petitioner before the trial Court as also before the appellate Court pressed his application for the grant of ad interim injunction on the basis of the averments made in the original plaint. The courts below disposed of the said application on the basis of the unamended plaint. The present petition arises out of the orders passed by the Courts below on the contentions urged before them on the basis of the unamended plaint. In the amended plaint the new dimension which is sought to be added to the controversy is that the deed dated 11th December, 1973, though styled as a license deed was in fact a lease deed in that the intention of the parties was to grant a lease in pursuance of which exclusive possession of the Kiosks was given to the petitioners for carrying on the business and thus interest in the premises was created in favour of the petitioners and that the deed was indeed Camouflaged as a license.

    7. The trial Court initially by its order dated 2nd June, 1975, while issuing notice to the Corporation of the application for the grant of ad-interim stay issued an ex parte injunction against the Corporation restraining it from dispossessing the petitioner from the Kiosk. However, on hearing the parties by its order dated 22nd July, 1975, the trial Court vacated the ex parte injunction earlier granted holding that the petitioner had failed to make out a prima facie case in his favour and also that the balance of convenience was in favour of the Corporation. The petitioner remained unsuccessful in appeal. The petitioner in the present revision petition challenges the correctness of the order dated 10th September, 1975, passed by the Appellant Court (Senior Sub-Judge, Delhi) whereby the petitioner's appeal against the order of the trial Court was dismissed.

    8. The facts of the other petitions are identical with the facts of this revision petition. The bid in these cases was held on 21st October, 1973. The Kiosk was allotted to these petitioners in Civil Revision Petitions 533 to 535 of 1973 as a licensee for 11 months with effect form 1st November, 1973, in pursuance of the deed dated 1st December, 1973, executed between them and the Corporation, the terms whereof are the same as in the case of Chandu Lal. The other averments in these revision petitions are similar to the averments already noted above in the case of Chandu Lal.

    9. Balkishan petitioner in revision petition No. 533 of 1973 was allotted Kiosk No. 4, his bid was for Rs. 610/- per month. On his application for the grant of ad interim injunction the trial Court issued ex parte injunction on 2nd June, 1975, which was subsequently vacated by order dated 22nd July, 1975. He challenged the said order in appeal but remained unsuccessful.

    10. Madan Mohan Talwar petitioner in revision petition No. 534 of 1975 was allotted Kiosk No. 3, his bid was for Rs. 370/- per month. The ex parte order issued by the trial Court in his case on 2nd June, 1975, was subsequently vacated by the Court by order dated 22nd July, 1975, and his application under Order 39, Rules 1 and 2 read with section 151 of the Code was dismissed. He too remained unsuccessful in the appeal.

    11. Mohan Lal petitioner in revision petition No. 535 of 1973 was allotted Kiosk No. 2, his bid was for Rs. 925/- per month. His application for the grant of ad interim injunction was dismissed by the trial Court by its order dated 6th June, 1975. He challenged the aforesaid order in appeal but remained unsuccessful.

    12. The appeals of all these petitioners were heard by Shri K.B Andley, Senior Sub-Judge, Delhi, who by his common order dated 10th September, 1975, dismissed the appeals of the petitioners. The petitioners challenged the correctness of the aforesaid order in these civil revision petitions.

    13. These petitions were heard by T.P.S Chawla, J. The learned Judge on hearing the parties observed that “after a person has been peaceably evicted in the exercise of a valid right of re-entry or self-help, he has no remedy if he seeks to regain possession. But, I do not think that it necessarily follows from this that the court will also not intervene before such eviction although the threat is imminent and the use of force can be foreseen”. He felt that the authorities in that respect were not uniform and were not easy to reconcile. The learned Judge accordingly took the view that a question of some difficulty and considerable importance arises in these petitions, touching the inner core of the rule of law which by its very nature was bound to be of frequent occurrence which needs to be decided more authoritatively by a larger Bench preferably to be decided by a Full Bench. He, therefore, directed that the papers be placed before the Chief Justice for such orders as may be deemed fit to make. This is how these petitions have been placed before us.

    14. Shri A.L Saigal, appearing for the petitioners, vehemently contended that a perusal of the so-called license deed unerringly shows that it is a lease deed whereunder transfer of right to enjoy the property for carrying on trade was made in favour of the petitioners; that the petitioners have complete control over the business that they conduct in these Kiosks and they do not work for the Corporation; that the petitioners are the free masters to assend to their business, there being no timing restrictions for carrying on their business; that the petitioners are not the employees or servants of the Corporation; and that they have been put in exclusive possession of their Kiosks to the exclusion of all others including the Corporation for carrying on their business. He submitted that by giving exclusive possession, interest in the property, namely, to use the premises for business purposes, was transferred to the petitioners. The deed though styled as a license deed in fact is a lease deed, the petitioners being tenants of the premises in question were protected under the provisions of the Delhi Rent Control Act, 1958, and cannot be ejected in a summary manner by resort to force. According to clause (4) of the agreement, Mr. Saigal submitted the possession of the Kiosk was given for purposes of trade.

    15. The question accordingly is whether the various clauses of the document in question, when read as a whole, in any manner carve out an interest in the demised property in favour of the petitioners. Although a person who is let into exclusive possession is prima facie to be considered a tenant, nevertheless if the circumstances negative such a conclusion and show that no tenancy was created, the person in possession would not be held to be a tenant. It is trite-saying that the intention of the parties is the real test for ascertaining the character of a document. It is beyond challenge that if a document gives only a right to use the property in a particular way but its possession and control remains with the owner thereof, it will be a license. In such a case the legal possession remains with the owner of the property, the licensee being permitted to make use of the property for a particular purpose. It would, therefore, be seen that for the permission the licensee's possession would be unlawful. Exclusive possession does not militate against the concept of a license, if the circumstances negative any intention to create a tenancy (See Associated Hotels of India v. R.N Kapur, A.I.R 1959 S.C 1262) (1).

    16. It is also beyond the pale of controversy that if the circumstances and the conduct of the parties show that what was intended was that the occupier should be granted a personal privilege with no interest in the land, he would be held to be a licensee.

    17. In the instant petitions, the Corporation before holding auction on 21st October, 1973, had published the “terms and conditions for the grant of license of Kiosk of Red Fort, Delhi” and invited bids on those terms. The petitioners participated and made a bid on those terms. It is, therefore, evident that the Corporation had invited bids for the grant of license in respect of Kiosk and the petitioners made a bid for obtaining a license for working on the premises in question. Clause 4 of the terms of auction clearly indicate that the bid “shall be for a period of 11 months in the first instance on monthly license free basis”, while clause 10 unmistakably stated that “the allotment/license of the Kiosk shall constitute liberty to the licensee to occupy and use the Kiosk for a period of 11 months in the first instance, and thereafter for such term of renewal as may be mutually agreed from time to time.” According to clause 15 the benefit of the license was neither transferable nor heritable. Further clause 22 indicated that the license to occupy the shop was liable to be cancelled at any time by the Commissioner of the Corporation or other officer duly authorised by him, without assigning any reason therefore. Clause 26 entitled the Commissioner of the Corporation, on expiry of the period of or revocation of allotment/license, to resume exclusive possession and charge of the Kiosk and deal with it in such manner as he may deem fit. Further any goods, articles, or things found lying in the Kiosk shall be liable to be seized, removed and sold by public auction by the Commissioner or any other officer empowered by him. The outstanding Corporation dues, if any, together with the charges for seizurer removal storage and sale of such goods, articles or things shall be met out of the sale proceeds; provided always that the allottee/licensee/owner may within seven days of the seizure of his goods, articles, or things may get them released after clearing the outstanding dues and paying the expenses and storage charges. From the various clauses of “the terms and conditions for the grant of license of Kiosk”, no apprehension could be entertained by the petitioners that they were bidding for the grant of a lease. They had made a bid with open eyes and knowing full well that they were obtaining only a license for using the premises for carrying on their trade and that the legal possession would remain with the Corporation. The intention of the parties is apparent that what was going to be auctioned was “licencee rights” and not “tenancy rights”. Apart from the fact that the heading of deed clearly indicates that it is a “deed of license” the reading of the various clauses of the deed unerringly shows that it possesses the characteristics of a “license”. The terms and conditions of the deed are consistent with the grant of a license and ‘do not accord with the creation of a lease’.

    18. Clause 1 of the deed gives liberty to the petitioners to occupy and use the Kiosk for a period of 11 months in the first instance and thereafter for such duration of renewal as may be mutually agreed to. The deed does not entitle the licensee to any right of alternative accommodation on the earlier termination of license. But for the liberty to occupy the Kiosk, the possession of the petitioners would have been unlawful. Clause 7, enjoins on the licensee not to part with the possession of the Kiosk or allow any other person to occupy the same or to use any part thereof, or to enter into any partnership with any person without the written permission of the Commissioner of the Corporation. Besides, it was specifically agreed that the benefit of the license was restricted to the licensee and was neither transferable or heritable.

    19. Clause 10 envisages that the licensee shall faithfully and diligently comply with all the directions, general or special, as may be given by the Commissioner of the Corporation from time to time. According to Clause 13, infringement of any of the terms and conditions of the deed by the licensee will lead to the cancellation of license of the Kiosk and the licensee will have no claim whatsoever on that count. As per clause 14, the license of the Kiosk is liable to be cancelled at any time by the Commissioner of the Corporation or other authorised officer without assigning any reason, in which event the amount of the fee for the remaining period of the license will be refunded to the licensee. Clause 18 of the deed entitles the Commissioner of the Corporation on the expiry of the period of or revocation of allotment/license to resume exclusive possession and charge of the Kiosk and deal with it in such manner as he may deem fit. Any goods articles or things found lying in the Kiosk shall be liable to be seized, removed and sold by public auction by the Commissioner or any other officer empowered by him. Further, the outstanding Corporation dues, if any, together with the charges for seizure, removal, storage and sale of such goods, articles or things shall be met out of the sale proceeds; provided always that the allottee/licensee/owner may within seven days of the seizure of his goods, articles or things get them released after clearing the outstanding dues and paying the expenses and storage charges.

    20. It will, therefore, be seen that it was made abundantly clear in the terms and conditions for the grant of license of Kiosk, that the highest bidder was to get only the right of an occupier without any right or interest in the Kiosk. The various terms of the deed noted above clearly show that the petitioners were given only physical possession but for which permission their occupation would have been unlawful, while the legal possession all along remained with the corporation. The terms of the document dated 11th December, 1973, read in the light of the surrounding circumstances reveals that it operated as a license and that no right or interest in the land was created in favour of the petitioners.

    21. According to section 105 of the Transfer of Property Act, 1882, a lease of immovable property is 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 transferer by the transferee who accepts the transfer on such terms. It is, clear from the above definition that a lease is not a mere contract but envisages and transfers an interest in the demised property creating a right in favour of the lessee in rem.

    22. License is defined in section 52 of the easement act and as reads under:

    “where one person grants to another, or to a definite number of other persons, a right to do, in or upon the immovable property of the granter, something which would, in the absence of such right, be unlawful, and such right does not amount to an easement or any interest in the property the right is called a license”.

    From the above definition it is evident that a license only makes an action lawful which without it would be unlawful but does not transfer any interest in favour of the licensee in respect of the property.

    23. The petitioners in the instant petitions were given the liberty to occupy the Kiosk for 11 months “for purposes of trade”; they were forbidden from parting with possession of the Kiosk or allow any other person to occupy the same or to use any part thereof or to enter into partnership with any other person without the written permission of the Commissioner of the Corporation. The liberty to occupy the Kiosk was personal to the petitioners alone. Besides the petitioners were required “faithfully and diligently” to “comply with all the directions, general or special” that may be given by the Commissioner of the Corporation from time to time. The infringement of any of the terms and conditions of the license was to result in the cancellation of the license, the petitioners having no claim whatsoever on that account. Further, the license was liable to be cancelled at any time by the Commissioner of the Corporation or other authorised officer without assigning any reason. All these conditions militate against “lease”, no interest in the premises passed to the petitioners. The Corporation in the circumstances in enforcing its right of re-entry by self help cannot be said to have taken the law into its own hands or that it was in any manner acting without recourse to law in resuming the possession. The underlying assumption in the case of a license is that the owner continues to be in possession and control of the property. In such circumstances the Court cannot throw its protection round the trespasser having no vestige of any right whatsoever, and his unlawful act of continuing to occupy the premises, by the issue of a prohibitory order against the lawful owner.

    24. In the instant cases the terms and conditions of the license, coupled with the surrounding circumstances, show that a bare license being a matter of personal privilege to occupy the Kiosk was granted in favour of the petitioners and was revocable even though it had been given for valuable consideration. (See Dominion of India v. R.B Sohan Lal, AIR 1950 H.P 40) (2).

    25. There is a catena of authorities in support of the proposition, that in the case of a license there is something less than a right to enjoy the property in the license; it cannot be exercise by servants and agents and is terminable while on the other hand, in the case of a lease, there is a transfer of a right to enjoy the property or in other words the lessee is entitled to enjoy the property. A bare licensee having no interest in the property cannot maintain an action for its possession. A mere licensee has only a right to use the property. Such a right does not amount to an easement or an interest in the property but is only a personal privilege to the licensee. After the termination of the license, the licensor is entitled to deal with the property as he likes. This right he gets as an owner in possession of his property. He need not secure a decree of the Court to obtain this right. He is entitled to resist in defence of his property the attempts of a trespasser to come upon his property by exerting the necessary and reasonable force to expel a trespasser. If however, the licensor uses excessive force, he may make himself liable to be punished under a prosecution, but he will infringe no right of the licensee. No doubt a person in exclusive possession of the property is prima facie to be considered to be a tenant, nevertheless he would not be held to be so if the circumstances negative any intention to create a tenancy.

    26. In the instant cases the petitioners' possession of the premises (Kiosk) on the facts and circumstances of the case, cannot be held to be conclusive evidence of their being a lessee as the grant was not coupled with an interest in the property. The principle once a licensee always a licensee applies proriovigore in these cases. The petitioners are not entitled to retain possession against the Corporation, which can take possession of the Kiosk and would not be driven to a Court of law as the mere physical possession of the petitioners confers no right on them. The petitioners, therefore, in law are not entitled to retain possession against the Corporation, having only the personal privilege to carry on their business which otherwise without the permission granted by the Corporation would be am unlawful act. These well-settled principles find support from Satwant Singh Sawhney v. D. Ramarathnam, Assistant Passport Officer, New Delhi, and others, AIR 1967 S.C 1836 (3); Associated Hotel's case (supra); B.M Lal (dead) by his L. Rs. and (2) R.N Ditta v. M/s. Dunlop Rubber Co. (India) Ltd. and other, AIR 1968 S.C 175 (4); Miss Aninha D'Costa v. Mrs. Parvatibai M. Thakur, AIR 1966 Bombay 113 (5); Beant Singh v. Cantonment Executive Officer, Jammu, AIR 1960 J&K 83 (6). Chinna Pillai v. N. Govindaswami Naidu and another, AIR 1969 Madras 191 (7); Th. Milka Singh and others v. Th. Diana and others, AIR 1964 J&K 99 (8) and Raj Singh v. Union of India, 1972 R.C.R, 718 (9) (A Bench decision of this Court).

    27. The Supreme Court recently in Board of Revenue etc. v. A.M Ansari etc., AIR 1976 S.C 1813 (10), retreated the position in law in this respect succinctly stating that it is the creation of an interest in immovable property or a right to possess it that distinguishes a lease from a licence. A license does not create an interest in the property to which it relates while a lease does. There is in other words transfer of a right to enjoy the property in case of a lease. Further it was observed as to whether a particular transaction creates a lease or a license is always a question of intention of the parties which is to be inferred from the circumstances of each case.

    28. So examined, the deed dated 11th December, 1973, executed between the parties has to be held to be a license.

    29. Shri Saigal, adverting to sections 197 and 201 of the Act, next contended that a perusal of the said provisions unmistakably shows that the Corporation could only grant a lease and not a license as the said provisions of the Act do not warrant the grant of a license. The precise argument was that there is a fundamental distinction between the capacity of a natural person and that of an artificial person which is created by a statute or charter. To a natural person whatever is not expressly forbidden by law is permitted by the law. It was urged that a natural person has the capacity to do everything save and except those forbidden by law, but in the case of an artificial person such as the Corporation being the creation of the Act, the rule applicable to a natural person is reversed. It was vehemently urged that whatever was not permitted expressly or by necessary implication by the Act was prohibited to be done not by any express or implied prohibition of the legislature but by the doctrine of ultra vires. Support for this submission was sought to be drawn from a Bench decision of Calcutta High Court in Satibhusan Mukherjee v. The Corporation of Calcutta, AIR 1949 Calcutta 20 (11).

    30. Dilating on the above-noted submission it was contended that under section 197 of the Act the Corporation shall, for the purpose of the Act, have power to acquire and hold movable and immovable property, or any interest therein. Section 200, it was urged, deals with disposal of property and empowers the Commissioner of the Corporation in his discretion to dispose of, by sale or otherwise any movable property belonging to the Corporation subject to the limitations contained in the aforesaid section. On the basis of the above-noted section it was vehemently contended that the only prove that the Corporation had was to acquire and hold movable and immovable property or any interest therein and further the Commissioner of the Corporation could dispose of property by sale or otherwise by granting a lease of the Corporation's immovable property but the aforesaid sections do not empower the Commissioner or the Corporation to grant a license.

    31. The argument has to be only noted to be rejected being without any merit. Power to hold immovable property in itself entitles the owner of the property to enjoy the property or its fruit in any manner that the owner may like. To any that the Corporation could hold the immovable property but could not grant license thereof to fetch, income from it is atrocious and untenable argument.

    32. Equally meritless was the submission that the Corporation under the Act was entitled only to issue licences envisaged by the provisions of section 416 and 417 laying down restrictions for establishing a factory etc. without permission of the Commissioner and use of the premises for certain purposes without obtaining a licence. His submission betrays total lack of appreciation of the concept of a licence and a lease known to law.

    33. Shri Saigal, then submitted that the petitioners were in possession of the Kiosk since January, 1974 and being in settled possession, the petitioners were not liable to be evicted except in due course of law and that they were further entitled to defend their possession even against the rightful owner who may try to dispossess them. This submission was sought to be reinforced on the basis of case Puran Singh and others v. The State of Punjab, AIR 1975 S.C 1674 (12). Reliance then was placed on a Bench decision of East Punjab High Court in State of Patiala and East Punjab States Union v. Mohinder Singh Natha Singh, AIR 1958 EP 325 (13) and Vasudeva Kurup v. Ammini Amma. 1964 KLT 468 (14) wherein it was observed that a person in possession albeit without title, was entitled to remain in possession, even against the lawful owner until evicted in due course of law and that a right course of action in such a case was to bring an appropriate action against the person in possession and secure his eviction in accordance with the provision of law. It was accordingly contended that the Corporation was not entitled to take the law into its hands and throw out the petitioners. There is a fallacy in the submission. The petitioners being licensees with liberty to occupy and use the Kiosk for a period of 11 months in the first instance could not be said to be in legal possession, of the premises, the legal possession all along remained with the Corporation. On revocation of the license they ceased to enjoy the liberty to continue to occupy the Kiosk so as to drive the Corporation to evict them in due course of law, nor can be petitioners' possession be said to be “settled possession” as sought to be made out.

    34. Shri Saigal next contended that on revocation of the license, the petitioners' possession of the Kiosks was that of a trespasser and having accepted license fee subsequent to the revocation of the license, the Corporation acquiesced in the possession of the petitioners as trespassers, in the circumstances the Corporation has no right to disposses the petitioners by force. This submission is equally devoid of force. In accepting license fee subsequent to the revocation of the license, all that can be said is that the license was extended up to the period the license fee was accepted but it cannot be said that the Corporation in any manner acquiesced in the alleged trespass or that the petitioners came to acquire “settled possession”. The basic fallacy in this argument is the assumption that on acquiring liberty to occupy the Kiosk possession of it was passed to the petitioners. The petitioners being licensees legal possession all along remained with the Corporation. That being so, as held by the Supreme Court, in Munshi Ram and others v. Delhi Administration, A.I.R 1968 S.C 702 (15), the Corporation had a right to re-enter the premises and reinstate itself provided it does not use more force than necessary. Such an entry would be received only as a resistance to an intrusion upon possession which had never been lost. Further, the law does not require a person whose property is forcibly tried to be occupied by trespassers to run away and seek the protection of the authorities, there being nothing more degrading to the human spirit than to ran away in the face of peril.

    35. Reliance on Lallu Yeshwant Singh (dead) by his legal representatives V. Rao Jagdish Singh and others, AIR 1968 S.C 620 (16) and Madan Mohan Lal v. State Of Punjab , 1970 R.C.J 95 (17) is wholly misplaced, the former case dealt with tenancy rights while the latter case pertained to lease rights. It was in that context that it was observed that even an unauthorised occupant could be evicted only in the manner authorised by law.

    36. No assistance can be derived by the petitioners from Delhi Simla Catholic Archdiocese v. The State of Uttar Pradesh and others, AIR 1976 Delhi 251 (18). In that case the right of the State as landlord to seek forcible eviction of the petitioners by exercising the right of re-entry was repelled as the petitioners, on the facts of the case, were held to be lessees.

    37. Temporary injunction sought by the petitioners could be granted if their case was covered by the three well-established principles, namely, (1) on making out a prima facie case, (2) on showing balance of convenience in their favour, in that the refusal of the injunction would cause “greater inconvenience to them and (3) whether on refusal of the injunction they would suffer irreparable loss. Granting an injunction is a matter of discretion and in its exercise the Court has to satisfy itself whether the petitioners have a triable case. Before invoking the jurisdiction of the Court to seek temporary injunction the petitioners were bound to show that they have a legal right and that there was an invasion of that right. They have failed to show a legal right. Facts and circumstances, on the contrary, prima facie show that the petitioners on the revocation of the license are trespassers, there exists no justification or allowing them to continue perpetuating their unlawful act.

    38. We see no infirmity, legal or factual, in the impugned order. The appellate Court in exercising its jurisdiction had neither acted illegally or with material irregularity, as such as held by the Supreme Court in The Managing Director (MIG) Hindustan Aeronautics Ltd., Balanagar, Hyderabad and another v. Ajit Prasad Tarway, Manager (Purchase and Stores) Hindustan Aeronautics Ltd., Balanagar, Hyderabad, AIR 1973 S.C 76 (19), High Court's powers of revision under section 115 of the Code, cannot be invoked.

    39. In view of our discussion on the various points noted above, the petitions fail and are dismissed accordingly. The petitioners shall pay the costs of the respondents.

    Petition Dismissed

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    Chandu Lal Etc. Petitioners v. Municipal Corporation Of Delhi
    (Nov 9, 1977)