Kidarsons Industries Pvt. Ltd. vs Allahabad Bank
1999 Latest Caselaw 529 Del

ORDER

M.S.A. Siddiqui, J.

1. By this order, I propose to decide the following issue No. 4-A ordered to be tried as preliminary issue :

"Whether the suit is not maintainable in the present form ?"

2. Plaintiff, claiming itself to be a tenant of the 4th floor of the building known as "Allahabad Bank Building" (hereinafter referred to as the suit premises) has filed the present suit for the following reliefs:-

"(i) For specific performance of the Agreement of Lease/Renewal of Lease upto November 30, 1998 with right of renewal thereafter as contained in the writings contained in the Agreement stated hereinabove;

(ii) For mandatory injunction directing the Defendant to maintain the parking areas, stair-cases, common corridors, toilets in the building in a state of reasonable repairs and cleanliness;"

3. To appreciate the merits of the controversy, it will be necessary to give brief narrative of the material facts. In 1965, the suit premises were let out to the plaintiff under an unregistered lease deed and the plaintiff's tenancy was renewed from time to time. By the letter dated 29.4.1989, the defendant agreed to renew the plaintiff's tenancy upto 30.11.1998 with the option for further renewal by mutual consent. According to the plaintiff, despite repeated requests, the defendant did not execute the lease deed. On the contrary, the defendant wrongfully terminated the plaintiff's tenancy vide quit notice dated 21.12.1995.

4. Defendant resisted the suit contending that there was no concluded contract between the parties for renewal of lease upto 30.11.1998 and so the suit in the present form is not maintainable. It is also alleged that since the lease was for a period exceeding one year, it could only have been extended by a registered instrument. In the absence of registered instrument the lease shall be deemed to be a lease from month to month. It is further alleged that the plaintiff's tenancy stands terminated by the notice to quit dated 21.12.1995 and so the present suit is not maintainable.

5. It is beyond the pale of controversy that in the year 1965, the suit premises were let out to the plaintiff under an unregistered lease deed and the plaintiff's tenancy was extended from time to time subject to increase in rent and service charges. According to the plaintiff, the defendant agreed to renew the tenancy upto 30.11.1998 with an option for further renewal vide letter dated 29.4.1989. The letter dated 29.4.1989 is as under:-

BLDG/ND/OSD/140 Building Department Dated : 29.4.89 Kidarsons Industries (P) Ltd. 4th Floor, Allahabad Bank Building, Parliament Street, New Delhi. Dear Sirs, Enhancement of Rent & Service Charges We acknowledge, with thanks, receipt of your letter No. ACCTS-0121 of date enclosing the following cheques towards payment of arrears of rent and service charges w.e.f 1.12.85 : Cheque No. Date Amount 123722 29.4.89 Rs. 1,75,000-00 123725 29.4.89 Rs. 1,31,286-00

and we agree/accept the existing (lease agreement is extended at current rates (i.e. Rs. 7/- and Rs. 5/- per sq. ft.) of rent and service charges upto 31.12.1993 and after that rent and service charges will be applicable by an increase of 25 % for the period upto 30th November, 1998 and thereafter as may be mutually agreed.

Thanking You,

Yours faithfully Sd/-

(R.V. SHARMA) OFFICER ON SPECIAL DUTY

6. Learned counsel for the plaintiff contended that the letter dated 29.4.1989 amounted to an agreement to lease and as such it could be used as a basis for the present suit for specific performance of contract. The question is : Does the letter dated 29.4.1989 require registration under Section 17 of the Registration Act. In D.D.A Vs. Durga Chand Kaushik , it was held that "a renewal of lease is really the grant of a fresh lease. It is called a `renewal' simply because it postulates the existence of a prior lease which generally provides for renewals as of right. In all other aspects, it is really a fresh lease." By the letter dated 29.4.1989 plaintiff's lease was extended upto 30.11.1998 subject to increase of rent @25 %. Since renewal of the lease was for a period exceeding one year, it could only have been extended by a registered instrument. Section 107 of the Transfer of Property Act postulates that a lease of the immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent, can be made by a registered instrument. In the absence of registered instrument, the lease shall be deemed from month to month, determinable by a statutory notice under Section 106 of the Transfer of Property Act.

7. That being so, the agreement for renewal of lease upto 30.11.1998 contained in the letter dated 29.4.1989 required registration under Section 17 of the Registration Act. The said letter is not admissible in evidence for showing creation of lease. Learned counsel for the plaintiff contended that the said letter is admissible under the proviso to Section 49 of the Registration Act to prove the terms of the agreement of lease. In my opinion, the said document is clearly inadmissible in evidence under Section 49 of the Registration Act except for the collateral purpose of proving the nature and character of possession of the plaintiff. The option for renewal or further extension of the lease is one of the terms of the original lease agreement, the proviso to Section 49 of the Registration Act is not applicable to the present case inasmuch as the terms of the lease are not "collateral purpose" within its meaning. (Satish Chand Vs. Goverdhan Das AIR 1984 SC 413). Consequently, I hold that the renewal clause of the lease agreement being a term of an inadmissible document, the letter dated 29.4.1989 could not form the basis of the present suit for specific performance of contract. Needless to add that Section 53A of the Transfer of Property Act is only available as a defense to a lessee and not conferring as right on the basis of which the lessee can claim rights against the lessor. (Delhi Motor Co. Vs. U.A. Basrurkar ; Biswabani (Pvt.) Ltd Vs. Santosh Kumar Dutta ).

8. For the foregoing reasons, I find and hold that the present suit for specific performance of the agreement in question is not maintainable. That apart, the letter dated 29.4.1989 shows that the lease was extended upto 30.11.1998 and thus the present suit has now become infructuous.

9. On 27.11.1998, the plaintiff filed an application under Order 6 Rule 17 CPC seeking leave to propose certain amendments in the plaint with a new relief for settlement of terms and conditions of grant of renewal of lease after 30.11.1998. This application has been opposed by the defendant. It needs to be highlighted that the present suit has been filed after receipt of the defendant's notice dated 21.12.1995 under Section 106 of Transfer of Property Act. It hardly requires any argument to show that the present suit has been initiated to nullify the effect of the defendant's notice under Section 106 of Transfer of Property Act. That apart, the letter dated 29.4.1989, which is the foundation of the present suit, provides further extension of leave by mutual consent. According to the plaintiff's own showing defendant had served the notice dated 21.12.1995 terminating its tenancy. In this view of the matter, the defendant cannot be permitted to use the judicial process as an instrument to compel the defendant to waive the said notice dated 21.12.1995 and extend the plaintiff's lease. As notice earlier, the plaintiff's suit for specific performance of the contract is not maintainable and further assuming that the suit was maintainable in the present form, the same has now become infructuous. Initially, the suit was filed for specific performance of the agreement dated 29.4.1989 and in order to save the suit from being dismissed as infructuous the plaintiff now wants to amend the plaint by adding a new relief for settlement of the terms and conditions for extention of lease after 30.11.1998. If the proposed amendment is allowed it would cause irretrievable injustice to the defendant. That apart, this is not a case where subsequent to the institution of the suit some event has happened which gives the plaintiffs a new cause of action for the relief proposed to be claimed by the amendment. On the contrary, it may safely be inferred from the circumstances of the present case that under the garb of the amendment application, the plaintiff wants to take away the right accured to the defendant on termination of its tenancy vide notice to quit dated 21.12.1995. Consequently, plaintiff's application under Order 6 Rule 17 CPC is also liable to be dismissed.

10. For the reasons discussed above, the suit and the application filed by the plaintiff under Order 6 Rule 17 CPC are dismissed. Plaintiff shall pay costs of the defendant and bear its own. Counsel's fee is quantified at Rs. 5000/-. A decree be drawn up accordingly.