Dismissed

Naresh Kumar v. Shagan Lal Kakkar

Punjab & Haryana HC19 Sept 2024CR/7221/2023

Case brief

AI extract

What is this about?

Tenant sought sine die adjournment of an ejectment petition pending disposal of his specific performance suit based on an agreement to sell with landlords. The High Court held the agreement contained no clause showing intention to surrender tenancy, so tenancy subsisted, and dismissed the revision.

What did the court decide?

None granted; impugned order rejecting adjournment application upheld and petition dismissed.

Naresh Kumar Vs Shagan Lal Kakkar — Specific Performance | Punjab & Haryana HC (2024)

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CR No.7221 of 2023 (O&M)

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IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH

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CR No.7221 of 2023 (O&M) Reserved on: 17.09.2024 Pronounced on: 19.09.2024

Naresh Kumar

.....Pe//oner

Vs.

Shagan Lal Kakkar and others .....Respondents

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CORAM:HON'BLE MR. JUSTICE DEEPAK GUPTA

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Present:Mr. Sandeep Khunger, Advocate and Mr. Saksham Khunger, Advocate for the pe��oner.

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DEEPAK GUPTA, J.

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In the ejectment pe��on �tled “Shagan Lal Kakkar and others Vs. Murari Lal and others” [CNR No.PBFZB0-000016-2022], pending in the Court of learned Rent Authority Jalalabad, the pe��oner herein is one of the respondents-tenants. During pendency of pe��on before the Rent Authority, he moved an applica�on to adjourn the proceedings sine die �ll the disposal of a Civil Suit for specific performance �tled “Naresh Kumar Vs. Shagan Lal Kakkar and others” pending in the Court of learned Addi�onal Civil Judge (Senior Division), Jalalabad, which has been dismissed by the Court by way of impugned order 05.08.2023, and is assailed by the pe��oner before this Court by way of present pe��on.

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As per the ejectment pe��on (copy Annexure P1), Shri Niamat Rai, the father of Shri Shagan Lal Kakkar ( respondent No.1 herein) and Madan Lal alias Ram Lal (predecessor-in-interest of respondents No.2 to 5 herein ) was the owner of the demised shop, which he had rented out about 50 years ago to Shri Mo� Lal (father of pe((oner and pro-forma

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Page No.1 out of 8 pages

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CR No.7221 of 2023 (O&M)

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respondents No.6 to 9 herein) . Ejectment pe��on has been filed against all the five children of Shri Mo� Lal i.e., pe��oner and pro-forma respondents No.6 to 9 herein , on 11.01.2022 on the various grounds including nonpayment of rent, unfit and unsafe for human habita�on; abandonment and bonafide necessity. Respondent No.4 of the pe��on i.e. pe��oner herein filed the wri>en statement (copy Annexure P4) contes�ng the ejectment pe��on.

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3.1 During pendency of this pe��on, the pe��oner herein moved an applica�on (Annexure P2) on 05.04.2023 sta�ng therein Shagan Lal and Shri Madan Lal alias Ram Lal had entered into an agreement to sell the demised shop to him and on the basis of that agreement, a suit for specific performance against the pe��oners of the ejectment pe��on had been filed, which was pending before Ld. Addi�onal Civil Judge (Senior Division) Jalalabad. He prayed for adjourning sine die the proceedings of the ejectment pe��on �ll the disposal of the civil suit for specific performance.

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3.2 The pe��oners of the ejectment pe��on i.e. contes�ng respondents herein filed reply dated 26.04.2023 (Annexure P3) opposing the applica�on by alleging the agreement relied by the pe��oner to be a false, forged and fabricated document, though they did not deny the pendency of the suit for specific performance. They further pleaded that ques�on of �tle was to be adjudicated in the suit but since the rela�onship of landlord and tenant between the par�es was not in dispute, therefore, the ejectment pe��on was liable to be proceeded with.

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3.3 Learned Rent Authority, aBer hearing both the sides, dismissed the applica�on by way of the impugned order dated 05.08.2023 (Annexure P.6).

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Assailing the afore-said order, it is contended by learned counsel that the moment the landlord and tenant enters into an agreement of sale/ purchase of the tenanted premises during subsistence of the tenancy and tenant pays part considera�on to the landlord towards the sale price of the premises, the rela�onship of landlord and tenant ceases to

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CR No.7221 of 2023 (O&M)

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exist, i.e. it results in termina�on of the tenancy. Learned counsel contends that since the suit for specific performance is already pending based upon the agreement to sell, therefore, the proceedings of the ejectment pe��on are liable to be adjourned sine die �ll the disposal of the suit for specific performance. Learned counsel has relied upon a judgment of Hon'ble Supreme Court in R. Kanthimathi and others Vs. Mrs. Beatrice Xavier, 2001(3) PLR 587 . Learned counsel contends further that learned Rent Authority has wrongly placed reliance upon Dr. H.K. Sharma Vs. Shri Ram Lal, 2019 (4) SCC 153 . With these submissions, learned counsel prayed for seGng aside the impugned order.

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This Court has considered the submissions of Ld. Counsel for the pe��oner and has appraised the record.

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The rela�onship of landlord and tenant between the par�es is not in dispute in respect of the demised premises, regarding which ejectment pe��on was filed by the contes�ng respondents in January, 2022. It is also undisputed that a suit for specific performance filed by the pe��oner – Naresh is pending before learned Addi�onal Civil Judge (Senior Division), Jalalabad, regarding the same tenanted premises.

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In the afore-said facts and circumstances, the ques�on arises for considera�on is as to whether on the execu�on of an agreement to sell the tenanted premises during the subsistence of the lease, the tenancy is determined and the rela�onship of landlord and tenant comes to an end or whether this can be a ground to defer the proceedings of ejectment pe��on.

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Similar ques�on was considered by Hon'ble Supreme Court in Dr. H.K. Sharma's case (supra) . In that case also, the conten�on was raised before Hon'ble Supreme Court that the rela�onship of landlord and tenant between the par�es had come to an end and that the same stood converted into new rela�onship of buyer and seller of the suit house and, therefore, the evic�on pe��on was no longer maintainable. In that case also, the reliance had been placed upon R. Kanthimathi's case (supra).

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CR No.7221 of 2023 (O&M)

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9.1 Hon'ble Supreme Court considered the following ques�ons:-

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“24. The ques�on, which arises for considera�on in these appeals, is when the lessor and the lessee enters into an agreement for sale/purchase of the tenanted premises where the lessor agrees to sell the tenanted premises to his lessee for considera�on on certain condi�ons, whether, as a result of entering into such agreement, the Jural rela�onship of lessor and the lessee in rela�on to the leased property comes to an end and, if so, whether it results in determina�on of the lease.

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In other words, the ques�on that arises for considera�on is when the lessor enters into an agreement to sell the tenanted property to his lessee during the subsistence of the lease, whether execu�on of such agreement would ipso facto result in determina�on of the lease and severe the rela�onship of lessor and the lessee in rela�on to the leased property.”

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9.2 Hon'ble Supreme Court then referred to Sec�on 111 of the Transfer of Property Act and held as under:

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“26. In our considered opinion, the aforemen�oned ques�on has to be decided keeping in view the provisions of Sec�on 111 of the TP Act and the inten�on of the par�es to the lease whether the par�es intended to surrender the lease on execu�on of such agreement in rela�on to the tenanted premises or they intended to keep the lease subsis�ng notwithstanding the execu�on of such agreement.

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Chapter V of the TP Act deals with the leases of Immovable property. This chapter consists of Sec�on 105 to Sec�on 117.

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A lease of an immoveable property is a contract between the lessor and the lessee. Their rights are governed by Sec�ons 105 to 117 of TP Act read with the respec�ve State Rent Laws enacted by the State.

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Sec�on 111 of the TP Act deals with the determina�on of lease. Clauses (a) to (h) set out the grounds on which a lease of an immoveable property can be determined.

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Clauses (e) and (f) with which we are concerned here provide that a lease can be determined by an express surrender; in case, the lessee yields up his interest under the lease to the lessor by mutual agreement between them whereas Clause (f) provides that the lease can be determined by implied surrender.

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This Court in the case of � ��

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��, (1976) 3 SCC 660 considered the scope of clauses

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CR No.7221 of 2023 (O&M)

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(e) and (f) of Sec�on 111 of the TP Act and laid down the following principle in Para 19 as under.

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“19. A surrender under clauses (e) and (f) of sec�on 111 of the Transfer of Property Act, is an yielding up of the term of the lessee's interest to him who has the immediate reversion or the lessor's interest. It takes effect like a contract by mutual consent on the lessor's acceptance of the act of the lessee. The lessee cannot, therefore, surrender unless the term is vested in him; and the surrender must be to a person in whom the immediate reversion expectant on the term is vested. Implied surrender by opera�on of law occurs by the crea�on of a new rela�onship, or by relinquishment of possession. It the lessee accepts a new lease that in itself is a surrender. Surrender can also be implied from the consent of the par�es or from such facts as the relinquishment of possession by the lessee and taking over possession by the lessor. Relinquishment of possession operates as an implied surrender. There must be a taking of possession, not necessarily a physical taking, but something amoun�ng to a virtual taking of possession. Whether this has occurred is a ques�on of fact.

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It is in the light of the aforemen�oned legal principle, the ques�on involved in this case has to be examined.”

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9.3 Hon'ble Supreme Court then referred to the agreement to sell dated 13.5.1993 produced in that case, which revealed that none of the condi�ons of the agreement provided in any specific terms about the fate of tenancy. None of the condi�ons set out in the agreement could be construed for holding that the par�es intended to surrender the tenancy rights. Hon'ble Supreme Court then held as under:-

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“34. A for�ori, the par�es did not intend to surrender the tenancy rights despite entering into an agreement of sale of the tenanted property. In other words, if the par�es really intended to surrender their tenancy rights as contemplated in clauses (e) or (f) of Sec�on 111 of the TP Act while entering into an agreement to sell the suit house, it would have made necessary provision to that effect by providing a specific clause in the agreement. It was, however, not done. On the other hand, we find that the condi�ons set out in the agreement do not make out a case of express surrender under clause (e) or implied surrender under clause (f) of Sec�on 111 of the TP Act.”

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CR No.7221 of 2023 (O&M)

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9.4 Hon'ble Supreme Court also no�ced the facts of R. Kanthimathi's case (supra) so as to hold that the legal proposi�on laid therein was not applicable, by holding as under:

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“35. It is for this reason, the law laid down by this Court in the case of R. Kanthimathi (supra) has no applica�on to the facts of this case and is, therefore, dis�nguishable on facts. Indeed, it will be clear from mere perusal of para 4 of the said decision quoted hereinbelow:

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“4. As aforesaid, the ques�on for considera�on is, whether the status of tenant as such changes on the execu�on of an agreement of sale with the landlord. It is relevant at this junc�on first to examine the terms of the agreement of sale. The relevant por�ons of the agreement of sale records the following:

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“I the aforesaid Mrs. Beatrice Xavier hereby agree out my own free will, to sell, convey and transfer the property to you Mrs. R. Kanthimathi wife of Mr. S. Ramaswami, 435 Trichy Road, Coimbatore for a mutually agreed sale considera�on of Rs.25,000/.

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I shall be proceeding to Coimbatore and shall execute the sale deed and present the same for admission and registra�on before the Registering Authority, accep�ng and acknowledge payment of the balance of considera�on of Rs. 5000/ (Rupees five thousand only) at the �me of registra�on and shall complete the transac(on of sale and conveyance as the property demised has already been surrendered to your possession.” (Emphasis in Original)

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The words highlighted in italics of the agreement were construed by Their Lordships for holding that these italicized words in the agreement clearly indicate that the par�es had really intended to surrender their tenancy rights on execu�on of the agreement of sale and bring to an end their jural rela�onship of the landlord and tenant.

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As observed supra, such is not the case here because we do not find any such clause or a clause akin thereto in the agreement dated 13.05.1993 and nor we find that the exis�ng condi�ons in the agreement discern the inten�on of the par�es to surrender the tenancy agreement either expressly or impliedly.

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In the light of the foregoing discussion, we are of the considered opinion that the tenancy in ques�on between the par�es did not result in its determina�on as contemplated under Sec�on 111 of TP Act due to execu�on

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of the agreement dated 13.05.1993 between the par�es for sale of the suit Page No.6 out of 8 pages

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house and the same remained unaffected notwithstanding execu�on of the agreement dated 13.05.1993.”

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Thus, the legal posi�on which emerges is that there should be an inten�on to surrender the tenancy rights, while entering into an agreement to sell of the tenanted property. If the par�es intended to surrender the tenancy rights as contemplated in clause (e) or (f) of Sec�on 111 of the Transfer of Property Act, while entering into an agreement to sell the tenanted property, it would be necessary to make a provision to that effect by providing a specific clause in the agreement. In R. Kanthimathi's case (supra) , the italicized words as used in the “agreement” were construed by Hon'ble Supreme Court to hold that those words clearly indicated the inten�on of the par�es to surrender the tenancy rights on execu�on of the agreement to sell and to bring to an end to their jural rela�onship of landlord and tenant between the par�es. However, this was not the posi�on in Dr. H.K. Sharma's case (supra) .

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In the present case, the agreement to sell, copy of which has been placed on record as Annexure P5 reveals that it was entered way back on 10.08.2001. As per this agreement, Shri Madan Lal @ Ram Lal and Shri Shagan Lal Kakkar had agreed to sell the demised property to Naresh Kumar (pe((oner herein) for considera�on of ₹3,50,000/- and had received an amount of ₹25,000/- as earnest money and that remaining amount was to be received at the �me of execu�on of the sale deed and that possession of the shop had already been given to the purchaser. The target date for execu�on of the sale deed was fixed to be 10.02.2002 or within 15 days from the date, when the sellers get the property transferred in their names in the record of the Commi>ee.

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Although in the reply to the ejectment pe��on (Annexure P4) dated 23.08.2023, it is men�oned by the pe��oner that suit for specific performance was filed but it is not men�oned as to when that suit was filed. Not only this, though the execu�on of any agreement to sell is denied by the landlords (contes(ng respondents herein) but even if the said

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agreement is taken at its face value, there is no s�pula�on in the said I attest to the accuracy and Page No.7 out of 8 pages

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CR No.7221 of 2023 (O&M)

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agreement to sell, either express or implied, indica�ng the inten�on of the par�es to surrender the tenancy. In fact, the agreement to sell is silent about the tenancy rights

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In the abovesaid facts and circumstances, R. Kanthimathi (supra) is not applicable to this case and rather, it is the legal posi�on explained in Dr. H.K. Sharma's case (supra) , which is applicable to this case. As such, it is held that learned Rent Authority did not commit any error in rejec�ng the applica�on for adjourning the proceedings of ejectment pe��on sine die, as it cannot be inferred that rela�onship of landlord and tenant between the par�es had ceased to exist.

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There is another reason for dismissing this pe��on. The ejectment pe��on has been filed by the landlords (respondents No.1 to 5 herein) against as many as five persons, who are the children of Shri Mo� Lal i.e. pe��oner herein and contes�ng respondents No.6 to 9. The agreement to sell (Annexure P5) relied by the pe��oner is only with him i.e. Pe��oner – Naresh Kumar and not with the other children of Mo� Lal. For this reason also, the proceedings of the ejectment pe��on cannot be adjourned sine die.

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On account of en�re discussion as above, this Court does not find any merit in the present pe��on.

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Dismissed.

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September 19, 2024 (DEEPAK GUPTA) renu JUDGE Whether Speaking/reasoned Yes Whether Reportable Yes

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Page No.8 out of 8 pages

Naresh Kumar v. Shagan Lal Kakkar

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Naresh Kumar v. Shagan Lal Kakkar

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