Anil K. Sen, J.:— This is an appeal under Cl. 15 of the Letters Patent directed against the judgment and decree dated January 5, 1971, passed by a learned single Judge of this court allowing a second appeal, Being Second Appeal No. 801 of 1956. By the judgment under appeal the learned single Judge having set aside a concurrent decree for recovery of possession passed by the two courts below, the plaintiff has preferred the present appeal. The appeal involves a short point as to whether acceptance of rent from a lessee of non-agricultural land after the expiry of the lease but for a period during which the lessee was protected against eviction under the provisions of the Bengal Non-Agricultural Tenancy (Temporary Provisions) Act, 1940 (hereinafter referred to as the 1940 Act) by the landlord would constitute a fresh tenancy by holding over or not. The material facts are not in dispute and may be set out briefly as follows:—
The defendant/respondent (hereinafter referred to as the defendant) was a lessee under the predecessor-in-interest of the plaintiff/appellant (hereinafter referred to as the plaintiff) for a period of 7 years ending with Pous 1349 B.S corresponding to Jan. 15, 1943. Before the lease had expired the 1940 Act came into force on May 30, 1940. Under S. 3 of the said Act, every suit or proceeding in any court for ejectment of a non-agricultural tenant other than one on account of non-payment of rent by such tenant was to be stayed so long the said Act continues in force. The proviso to the said section further provided that every proceeding for delivery of possession in execution of a decree for ejectment on account of non-payment of rent by such tenant shall be stayed if within 30 days from the date of the decree such tenant deposits in court the amount of the decree together with the costs of the proceeding. Section 6 further provided that every suit or proceeding to which the provisions of S. 3 are applicable which is pending at the date of the commencement of the Act shall be stayed for the period during which the Act continues to remain in force. In that background when the lease in favour of the defendant expired on Jan. 15, 1943, no suit for his eviction was instituted by the plaintiff forthwith but admittedly the plaintiff continued to accept rent offered to him up to and including the rent for the year 1355 B.S Last of the rents offiered was by money-order dated Aug. 5, 1949, which was received by the plaintiff on August 11, 1949. It is, however, not in dispute that the 1940 Act remained in force during the entire period for which rent was so accepted and the same was repealed by S. 91 of the West Bengal Non-Agricultural Tenancy Act, 1949 (hereinafter referred to as the 1949 Act) which came into force on May 15, 1949.
2. On Feb. 23, 1954, the plaintiff instituted the suit out of which the present appeal arises praying for recovery of possession of the leasehold land by eviction of the defendant therefrom and for compensation. Such a suit was instituted on the basis that the lease in favour of the defendant having expired and the defendant under the terms of the lease being bound to deliver vacant possession, the plaintiff was entitled to recover possession of the leasehold land by evicting the defendant therefrom.
3. The defendant did not dispute the position that he was a lessee in respect of the non-agricultural land holding under a registered lease for a period of 7 years which expired with effect from Jan. 15, 1943. His defence, however, was that since there was payment and acceptance of rent even after the expiry of the lease he must be held to be holding over so that the tenancy created by such holding over if tagged with the original lease for 7 years, then he is entitled to claim non-ejectable right under the provisions of the 1949 Act Alternatively, it was claimed on behalf of the defendant that in any event in the absence of any notice determining the tenancy created by the holding over in accordance with the provisions of the 1949 Act, he is not liable to be evicted.
4. Both the courts below overruled both the aforesaid defence of the defendant on the view that by payment and acceptance of rent between the parties no new tenancy by holding over was created in view of the fact that the lessee was protected from eviction under the provisions of the 1940 Act for the period for which rent was so accepted by the plaintiff. The learned single Judge of this court, however, took the view that since last of the payment and acceptance of rent between the parties was in Aug. 1949, that is after the repeal of the 1940 Act, provisions of S. 116 of the Transfer of Property Act would come into play and such payment and acceptance of rent would constitute holding over. The learned single Judge, therefore, held that as there was a fresh tenancy created by the parties by holding over there could be no decree for recovery of possession by eviction of the defendant unless at least that tenancy is determined in accordance with the provisions of the 1949 Act. In that view, the learned single Judge set aside the concurrent decree passed by the two courts below in favour of the plaintiff and dismissed the suit. Feeling aggrieved the plaintiff has preferred the present appeal under Cl. 15 of the Letters Patent.
5. Mr. Banerji appearing in support of this appeal has strongly contended that the learned single Judge of this court was in error in holding that payment and acceptance of rent in the facts and circumstances of the present case would constitute holding over. According to Mr. Banerji it is not so much material as to when the rent was accepted because the rent that was accepted was for a period when the plaintiff had no choice of getting recovery of possession by evicting the defendant since the defendant was protected in his possession by the provisions of the 1940 Act. It has been contended by Mr. Banerji that in view of the statutory restrictions imposed on the plaintiffs right to recover possession during the material period his acceptance of rent for that period would not necessarily lead to any inference that the plaintiff accepted the rents so offered by assenting to the tenant's continuing in possession as a tenant, According to Mr. Banerji though the learned single Judge had referred to some of the earlier decisions of the Supreme Court and the Federal Court on the point he had failed to appreciate the true effect and import of those decisions.
6. Mr. Roychowdhury appearing on behalf of the defendant has contested the point thus raised by Mr. Banerji. According to Mr. Roychowdhury the 1940 Act created no statutory tenancy so that what was offered by way of rent was not statutory rent. Such an offer of rent having been accepted the plaintiff had only displayed his intention to assent to the tenant's continuing in possession as a tenant. Great emphasis has been laid by Mr. Roychowdhury on the fact that in the present case the original lease having expired, the tenant was liable to pay for his continuing in possession nothing else than damages even in spite of the provisions of the 1940 Act so that when he went on offering rent for the subsequent period and that offer was accepted by the plaintiff/landlord, the provisions of S. 116 of the T.P Act are squarely invoked. It has further been contended by Mr. Roychowdhury that in any event when the 1940 Act stood repealed with effect from May 15, 1949, the defendant's possession was no longer protected so that if any rent was tendered thereafter as in the present case and was accepted as such there is no reason why such acceptance would not constitute holding over.
7. We have carefully considered the rival contentions put forward before us. Section 116 of the T.P Act provides that if a lessee remains in possession of the leasehold property after the determination of the lease and the lessor accepts rent from such lessee or otherwise assents to his continuing in possession the lease is renewed. It is, however, well settled by now that a tenancy by holding over is a new contractual tenancy which is created by consent of parties. A lessee whose lease has expired but who continues to remain in possession and offers rent, obviously does so with an intent to continue or renew the lease which has expired and when the lessor accepts such offer the parties obviously agree to create a new contractual tenancy. Such an inference is drawn only in normal circumstances when parties are free to exercise their option and are not under any compulsion and there is nothing intervening which leaves either of them with no option and as such an intent to create a tenancy is not inferred as a matter of course. In the case of Kai Khushroo v. Baijer Bai, AIR 1949 FC 124, it was pointed out by the Federal Court that such an intention on the part of the lessor cannot be inferred where Rent Restriction Acts apply and the lessee enjoys statutory immunity from eviction. This principle had consistently been affirmed by the Supreme Court. Reference may be made to the cases of Ganga Dutt Murarka v. Kartick Chandra Das, AIR 1961 SC 1067 and Bhawanji Lakhanji v. Himatlal, AIR 1972 SC 819. Mr. Roychowdhury wanted to distinguish those decisions on the ground that unlike the Acts there under consideration by the Supreme Court, the 1940 Act created no statutory tenancy and, as such, imposed no statutory liability on the tenant to continue to pay any rent. According to Mr. Roychowdhury, the material provisions of the 1940 Act only provided for stay of further proceedings of any suit or proceeding for eviction of a non-agricultural tenant and that too again if it was not on the ground of non-payment of rent. We are, however, not impressed by such an argument put forward by Mr. Roychowdhury. In our view, it is not so much important whether the particular Act created a statutory tenancy or not for, if the Act conferred statutory protection to the lessee from eviction, the lessor loses his right to recover possession by eviction of such a lessee and as such acceptance of rent from such a lessee who remains in possession under statutory protection does not justify any inference of any intention on the part of the lessor to assent to the lessee's continuing in possession as a tenant. In such a situation, the lessee continues in possession under the statutory protection and the lessor cannot be deemed to have given assent to the lessee's continuing in possession by mere acceptance of rent in the absence of any other evidence of conduct on the part of the lessor to give such assent irrespective of the statutory protection. By payment and accetpance of rent in such a situation neither of the parties can be said to have displayed any animus of creating a new contractual tenancy. So far as the lessee is concerned, he offers the rent because he continues to remain in possession under the statutory protection and, as such, is liable to pay an equal amount at least by way of mesne profits or damages. The lessor on the other hand accepts the same because he has no choice as his right to evict the lessee stands suspended. Such being the position, the basic foundation for invoking the provisions of Sec, 116 is lost.
8. So far as the second point raised by Mr. Roychowdhury is concerned, and which found favour with the learned single judge, we are unable to hold that acceptance of last of the payments after the repeal of 1940 Act would in any way change the legal position. It is not in dispute that though such payment was accepted in Aug. 1946, it was for a period prior to May 1949, that is, for a period when the 1940 Act stood in the way of the lessor's enforcing his right to recover possession. It has been contended by Mr. Roychowdhury that such payment was offered by way of rent by the lessee and it was accepted as such by the lessor who knew very well that for the said period the lessee can have no liability for rent. In our view Section 116 of T.P Act provides that it is only acceptance of rent by way of assenting to the lessee's continuing in possession as a lessee which constitutes holding over. Mere acceptance of rent by itself would not be sufficient unless such acceptance indicates an animus on the part of the lessor to continue the lease or renew the same. This was made clear by the Supreme Court in the case of Karnani Industrial Bank v. The Province of Bengal, AIR 1951 SC 285 at page 287. We have already indicated that in the present case when the lessor's right to recover possession for the material period was suspended by the statute acceptance of an amount equivalent to rent though offered by way of rent by the lessee would not by itself lead to any inference of the material animus on the part of the lessor assenting to the lessee's continuing in possession as a lessee. For the very same reason, we are of the view that such acceptance even after the repeal of 1940 Act would not lead to any such inference because what was being accepted by the lessor was an amount equivalent to rent for a period when he had no right to evict the lessee. With great respect we are of the opinion that the learned single judge overlooked this aspect of the legal position in overruling the concurrent finding of the two courts below in this regard and in setting aside the decrees passed by the two courts below, on the view that in the facts and circumstances of the present case a new tenancy was created between the parties by holding over.
9. In the result, the appeal succeeds and is allowed. The judgment and decree passed by the learned single judge being set aside the decree passed by the trial court is restored. The appellant is entitled to costs and there will be a decree for costs in favour of the appellant.
B.C Chakrabarti, J.:— I agree.
Appeal allowed.