Friday, 20 September 2019

How to ascertain whether particular agreement is lease deed or leave and licence agreement?

Here, the residential portion was let out only as a stopgap
arrangement, and the licence was terminable on the happening of a
contingency. That contingency—the return of the landlady’s son—will
terminate the agreement, the agreement period notwithstanding.
Besides that, there have been restrictions on the use: for example, how
and only for what purpose the bathroom could be used.
70. In Tulsi, the Supreme Court has held that a licensee gets the
possession only with the consent of the licensor and is liable to vacate

when so asked. Then, Shrikant contends that he has had uninterrupted
possession. According to him, though the alleged licence expired in
1989, until 1994 his possession had not been disturbed. That said, once
it is a licence, merely because the licensor has not asked the licencee to
vacate soon after the licence period does not transform the licence into
lease. The length of the period is not, I must say, a determinative factor.
71. In Achintya Kumar Saha, the Supreme Court has reiterated
that the nature of lease and licence to be gathered from surrounding
circumstances. In Amratlal Valji, this Court has relied on the Supreme
Court’s proposition in C.M. Beena’s case. It has held that the difference
between lease and licence is to be determined based on the document
and surrounding circumstances.
(b) What sort of possession does the occupier have?
72. Shrikant contends that it would have been impossible for him
to enjoy the property, had he not been in possession. A person’s
occupying a residential property speaks volumes about that occupier’s
possessing the property, and enjoyment without possession, according
to him, is unthinkable and impracticable.
73. In this context, I may note that there are many shades of
possession: say, corporeal possession, incorporeal possession,
constructive possession, adverse possession, de facto possession, de jure
possession, mediate possession, and immediate possession. Indeed,
immediate possession is a direct or primary possession. The person in
direct possession has a higher control over the thing possessed. It means
there is no intermediary or medium. On the contrary, if someone
possesses something through another, the thing remains in possession
of another. That is, the possessor has a lesser control over the thing he
has physically possessed, though.
74. Lexically speaking, ‘possession’ is a chameleonhued
word. G.
W. Paton in his A Textbook of Jurisprudence has ‘pessimistically states’

that the search for its proper meaning is likely to be a fruitless one.[26]
The expression 'possession' is a polymorphous term which assumes
different colours in different contexts. It may carry different meanings
in contextually different backgrounds. It is impossible, as was observed
in Superintendent & Remembrancer of Legal Affairs, West Bengal v. Anil
Kumar Bhunja[27], to work out a completely logical and precise
definition of "possession" uniformly applicable to all situations in the
context of all statutes.
75. As noted in Gunwantlal v. The State of M.P.[28], possession in
a given case need not be physical possession but can be constructive,
having power and control over the article in case in question, while the
persons to whom physical possession is given holds it subject to that
power or control. That is, the word 'possession' means the legal right to
possession. In an interesting case, it was observed that where a person
keeps his firearm in his mother's flat which is safer than his own home,
he must be considered to be in possession of the same. (See Sullivan v.
Earl of Caithness.[29]
76. Here, I must hold that what Shrikant has is mediate
possession, like the mother’s possessing the son’s firearm in Sullivan. To
conclude, his possession is mediate and permissive.

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO. 2219 OF 2006

Shrikant Dattatraya Deshpande  Vs  Shalini Waman Bhat 

CORAM
: DAMA SESHADRI NAIDU, J.
DATE OF PRONOUCEMENT : 13th September 2019.


Petitioner Shrikant Dattatraya Deshpande claims to be a “tenant”.
Indeed, much turns upon that expression, for respondent Jayant
Waman Bhat asserts that Shrikant is only a licencee. Originally, Shalini
Waman Bhat, Jayant’s mother, as the owner, filed Application No.17 of
2004 under Section 24 of the Maharashtra Rent Control Act, for
evicting Shrikant. She filed that application before the Competent
Authority, Pune Division. Through its order, dated 29th January 2005,

the Competent Authority allowed that application.
2. Aggrieved, Shrikant filed Revision No.166 of 2005 before the
Additional Commissioner, Pune. But the Additional Commissioner, too,
dismissed the revision, through order dated 3rd March 2005. Then,
Shrikant has filed this writ petition. Pending these proceedings, Shalini
Waman Bhat died; so her son, Jayant, as the legal representative, has
been prosecuting the case.
3. Though the facts seem to lie in a narrow compass, this case has
a chequered history. It all began in 1986. So I need to set out the facts,
as well as the course of litigation, briefly though.
4. On 1st June 1986, Shrikant and Mrs. Bhat signed an
agreement. That agreement was for three years, that is until 31st May
1989. Through that agreement, Mrs. Bhat permitted Shrikant to live in
a portion of her house. The bone of contention throughout has been
whether the agreement created a lease or a licence. Plainly put, is
Shrikant a tenant or a licensee?
5. Though the agreement ended in 1989, Shrikant continued to
enjoy the property. On 3rd March 1994, Mrs. Bhat allegedly disrupted
the power supply to the leased portion of the house. Therefore, Shrikant
filed Application No.193 of 1994, before the Small Cause Court, Pune.
He invoked Section 24 of the nowrepealed
Bombay Rents, Hotel and
Lodging House Rates Control Act, 1947. In that case, the issue was
about the restoration of power supply. Incidentally, there arose a
question about whether Shrikant is a tenant or a licensee.
6. Through its order dated 25th August 1994, the Small Cause
Court ordered the restoration of power supply. Besides that, it also held
that Shrikant is a tenant. Aggrieved, Mrs. Bhat filed a revision. The
District Court allowed that revision. It seems that it has felt that the
Small Cause Court ought not to have determined the status of the
parties. At any rate, Shrikant impugned the revisional order in WP
No.1272 of 1998. In June of the same year, this Court allowed that writ

petition. Then, Mrs. Bhat filed a Civil Application in that disposedof
Writ Petition.
7. In the Civil Application No.5856 of 1998, Mrs. Bhat contended
that the Court’s observation that Shrikant was a tenant would prejudice
her cause before the Civil Court, where she had sued for recovery of
possession. I will refer to it soon. Then, this Court, through its Order,
dated 17th June 1998 in the Civil Application, held that the expressions
employed in the order about the parties’ status should not prejudice
their rights before the Civil Court.
8. Now, I will refer to the Civil Suit. Mrs. Bhat filed Special Civil
Suit No.8 of 1995 before the Civil Judge, Senior Division, for recovery
of possession from Shrikant. In that suit, first, Mrs. Bhat maintained
that Shrikant is a licensee and that the agreement is a leave and license
agreement. She has pleaded that her remedy before the Authorities
under the Act stands barred by efflux of time. So she sought from the
Civil Court the remedy of recovering possession from Shrikant.
9. Then, Shrikant, as the defendant, applied under Order 7, Rule
11 of CPC. He wanted the Civil Court to dismiss the suit for want of
jurisdiction. As a result, on 24th June 2003, the Civil Court dismissed
the suit. Aggrieved, Mrs. Bhat filed Writ Petition No.346 of 2004. This
Court, through its Judgment, dated 13th April 2004, disposed of the
writ petition holding that Mrs. Bhat had an efficacious alternative
remedy, for an order under Order 7 Rule 11 is a deemed decree.
10. But Mrs. Bhat pursued no alternative remedy against the Civil
Court's rejecting the plaint. Instead, she invoked Section 24 of the
Maharashtra Rent Control Act and applied before the Competent
Authority for Shrikant’s eviction. Indeed, she pleaded that Shrikant is a
licensee and that the licence expired long back. The competent
Authority allowed that application, as I have noted earlier.
11. On revision, the Revision Authority, too, refused to interfere.
So Shrikant has filed this writ petition, invoking Article 227 of the

Constitution of India.
Submissions:
Petitioner:
12. In the above factual background, Shri D. J. Bhanage, the
learned counsel for the petitioner, has submitted that the civil courts
and this Court, throughout, have held that Shrikant is a tenant. For
that assertion, Shri Bhanage has emphasised the Small Cause Court’s
observations in Shrikant’s Application No.193 of 1994.
13. While faced with subsequent developments and, especially,
the reversal in the reversion, Shri Bhanage has insisted that a finding of
fact does not get diluted even in the face of the doctrine of merger.
According to him, this Court may have observed in the later round of
litigation that the parties could agitate the issue before the Civil Court.
But that observation will not help the owner’s cause.
14. At any rate, Shri Bhanage has taken me to the agreement,
dated 1st June 1986. Reading out from, as he puts it, a literalEnglish
translation of the agreement, Shri Bhanage has asserted that the
document unmistakably establishes the parties’ intention: the
agreement is a lease, and Shrikant a tenant.
15. Shri Bhanage has submitted that calling Shrikant a licencee is
a misnomer. First, he could not have been living in the house without
having its effective possession. Second, as it is a bungalow, Shrikant’s
not having access to the other parts of it will not defeat his right to be a
tenant to the extent leased to him. About the restrictions on the use of
the property, Shri Bhanage insists that any restrictions on the use of the
property for its safety or upkeep cannot amount to a restriction on its
enjoyment. At any rate, those conditions would not affect Shrikant’s
leasehold right.
16. According to Shri Bhanage, the competent Authority and the
Revision Authority have not addressed the issue in its proper legal
perspective. Referring to the judgment the Authorities have relied on,

Shri Bhanage stresses that the ratio of those judgments favours
Shrikant.
17. To elaborate, Shri Bhanage has submitted that this Court’s
observation about the relationship between the parties stands
undisturbed. And though the Court is said to have left the issue open
about the tenancy, that liberty was confined to Civil Suit No. 8 of 1995.
When the suit was dismissed for want of jurisdiction, the owner did not
take the matter to its logical end. So, Shri Bhanage has urged this Court
to allow the writ petition.
18. Shri Bhanage has relied on Sohan Lal Naraindas v. Laxmidas
Raghunath Gadit[1], Manika Dei v. Dhadi Madgul[2], Capt. B.V. D’Souza
v. Antonio Fausto Fernandes[3], Ramachandra Sahu v. Pramila Sahu[4],
Vafati Lalmohamed v. Sarfunisa Abdulmajid[5], Globe Publications v.
Madan Gopal[6], Tulsi v. Paro[7], Bharamappa Nemanna Kawale v.
Dhondi Bhima Patil[8], C.M. Beena v. P.N Ramachandra Rao[9], Smt.
Krishnabai v. Baburao[10], Laxman Vitthal Rewankar v. Rajaram
Narayan Pohurkar[11], Gulabchand Chhotalal Parikh v. State of
Gujarat[12], Choudhary Sahu v. Surajballi Sah[13], Centre of Indian
Trade Unions v. Union of India[14], Amratlal Valji v. Dr. G.S. Shah[15],
and Achintya Kumar Saha v. Nanni Printers[16].
Respondent:
1[] (1971) 1 SCC 276
2[] AIR 1987 ORI 74
3[] AIR 1989 SC 1816
4[] AIR 1992 Orissa 183
5[] AIR 1993 Gujarat 163
6[] AIR 1996 P & H 115
7[] (1997) 2 SCC 706
8[] AIR 1997 SC 122
9[] (2004) 3 SCC 595
10[] AIR 1978 Bombay 290
11[] AIR 1979 Bombay 305
12[] AIR 1965 SC 1153
13[] AIR 1982 SC 98
14[] AIR 1997 Bombay 79
15[] 2007 (1) Bom. CR., 390
16[] AIR 2004 SC 1591

19. Shri A. V. Anturkar, the learned Senior Counsel for the first
respondent, has formulated, in his words, seven points to counter
Shrikant’s assertions. To begin with, the alleged lease deed falls within
the mischief of Section 107 of the Transfer of Property Act. As the
period mentioned in it was three years, it required compulsory
registration. In its absence, the document could not be considered for
any other purpose than collateral. To elaborate, Shri Anturkar has
submitted that only possession, nothing else, could be gathered from
Exh. A2 agreement.
20. Then Shri Anturkar has, as his second proposition, drawn my
attention to Sections 91 and 92 of the Evidence Act. He has contended
that the agreement was reduced to writing. That done, in terms of
Section 92 of the Evidence Act, no further evidence could be led to
dilute the contractual terms reduced to writing. As his third proposition,
the learned Senior Counsel has submitted that the burden was heavy on
Shrikant to establish before the Court or the authorities that there was
tenancy and the relationship between them was that of landlady and
tenant. According to him, Shrikant has not even got into the witness
box to discharge his burden. Instead, Shrikant has marked the
documents, such as copies of depositions in some other suit. In that
context, Shri Anturkar has contended that the depositions in other cases
become only the previous statements without any independent
evidentiary value.
21. As to his fourth proposition, Shri Anturkar has elaborated on
Shrikant’s alleged exclusive possession. He has taken me through the
agreement to highlight, as he puts it, the restrictions the landlady
imposed on Shrikant’s enjoying the property. He has also emphasized
that the parties executed the agreement without any legal advice or
assistance. Therefore, it reflected the parties’ true intention. In praise of
the parties, he has submitted that the agreement contained absolutely
neutral expressions, with no reference to either lease, rent, or receipt,

much less to any exclusive possession.
22. Eventually, as part of his remaining propositions, the learned
Senior Counsel has taken me through Section 11 of CPC. Then, he
contended that the eviction proceedings remain unaffected by the
principle of res judicata. He has contended that the Civil Court that
refused to entertain Suit No. 8 of 1995 is incompetent to decide the
dispute. It is the Competent Authority that has the jurisdiction under
Section 24 of the Act. So, the basic ingredient of Section 11 of CPC
finds missing—a decision on merits by a competent court in an earlier
round litigation.
23. In the alternative, Shri Anturkar has submitted that if the
judgment in Suit No. 8 of 1995 were to bind the parties, there was a
clear finding that the suit property admittedly was given on license to
Shrikant. If it was an erroneous observation, Shrikant ought to have
tried to have it modified or corrected.
24. Thus, eventually, the learned Senior Counsel has relied on
Anthony v. K. C. Ittoop & Sons[17], Delta International Ltd., v. hyam
Sundar Ganeriwalla[18], and Sevoke Properties Pvt. Ltd. v. West Bengal
State Electricity Distribution Company[19].
Reply:
25. Shri Bhanage, in reply, has submitted that the expression
“admittedly” in the Civil Court’s judgment was in the context of the
pleadings but not an observation by the Court. He has also submitted
that the first respondent has never raised the issue of registration or the
burden of proof before any Authority.
26. Heard Shri D. J. Bhanage, the learned counsel for the
petitioner, and Shri A. V. Anturkar, the learned Senior Counsel for the
respondent.
17[] (2000) 6 SCC 394
18[] (1999) 4 SCC 545
19[] AIR 2019 SC 2664

Discussion:
27. This matter needs decluttering. Many rounds of litigation
have only led to confusion; so let us identify the issues.
Issues:
Issue No.1: Are the Owner’s proceedings barred by Res Judicata? Or, is
there any judicial finding or declaration that the occupier is a tenant in
the earlier round of litigation?
Issue No.2: If treated as a lease deed, does the Agreement, dated 1st June
1986, require registration?
Issue No.3: What is the Agreement, dated 1st June 1086: is it a lease deed
or a leave and licence agreement?
Issue No.4: Does the marking of the Previous Depositions in Other Cases
Between the Same Parties amount to Substantive Evidence?
Issue No.5: Have the Competent Authority and Revisional Authority
Committed any Jurisdictional Error requiring this Court’s Judicial
Intervention?
Discussion:
28. This case has seen a few rounds of avoidable litigation
already. So it pays to trace its litigious roots.
The Roots of Litigation:
Case Details Result Remarks
Application
No.193/1994
U/s. 24 of the
Bombay Rent
Act (Old Act)
25.8.94:
Allowed
(Shrikant)
(1) The landlady was asked to
restore power supply;
(2) “The intention of the parties
was to create lease, and so the
applicant is the tenant of the suit
premises.”
CRA
Nos.135/94 &
136/94
29.11.97
Allowed
(Mrs. Bhat)
(1) “It nowhere mentions that a
person whose status is not accepted
by the other side as a tenant can
apply for restoration of the
electricity supply as per the section
(Section 24).”
(2) “The status of a person cannot
be inquired into.”

WP No. 1272
of 1998
23.06.1998
Allowed
(Shrikant)
Reversed the order in revision and
restored the trial Court’s order.
C A.
No.22498/19
98
in WP
No.1272 of
1998
17.07.1998
Clarified
“No expressed any opinion on the
issue as to whether the petitionerapplicant
is the tenant of the suit
premises.”
Civil Suit No.
8 of 1995
(6th Joint
Civil judge
Senior
Division,
Pune.)
24.06.2003
Mrs. Bhat’s
suit was
dismissed
for want of
jurisdiction
(1) “On perusal of the pleadings
itself, the defendant as licensee of
the suit property was given to him
on leave and license basis.
(2) “Admittedly the suit property
was given on license to the
defendants. Admittedly the
defendants approaching the Small
Cause Court for . . . restoration of
electricity supply. In the same
judgment, it was observed that the
defendant was tenant of the suit
premises, the same thing was
confirmed by the Hon’ble High
Court. It is endless to mention that
the order passed by the above Court
has not been challenged . . .”
(3) The pleadings are sufficient to
infer that the Civil Court does not
have any justification to entertain
to suit for possession and arrears of
license fees as claimed by the
plaintiff.
WP No.346 of
2004
13.04.2004
Dismissed
(Mrs. Bhat
lost)
Mrs. Bhat has an efficacious
alternative remedy against the trial
Court’s judgment, dt.24.06.2003 in
Suit No.8 of 1995.
Application
No.17 of 2004
U/s. 24 of
MRC Act,
before the
Competent
29.01.2005
Allowed
(Mrs. Bhat
won)
The Competent Authority allowed
it: ordered Shrikant’s eviction.
Findings:
(1) Shrikant filed on record
documents with ListExh.
38 but he
did not adduce any oral evidence.

Authority (2) Interpreted the agreement to be
a leave and licence agreement
(para 34)
(3) Earlier nowhere has there been
a declaration that Shrikant is a
tenant (para 36).
Revision
Application
No.166 of
2005
Before the
Addl.
Commissioner
03.03.2006
Dismissed
(Shrikant
suffered
concurrent
findings)
The Revisional Authority concurred
with the Competent Authority and
affirmed the Order, dt.29.01.2005
Issue No.1: Are the Owner’s proceedings barred by Res Judicata? Or, is
there any judicial finding or declaration that the occupier is a tenant in
the earlier round of litigation?
29. Shrikant has strenuously and persistently contended that the
courts below have already declared that he is a tenant. Indeed, there
was a finding in the Small Cause Court’s Order, dated 25th August 1994,
in Shrikant’s Application under Section 24 of the Bombay Rent Act. It
was for the restoration of power supply. In revision, that observation
was upset. But this Court in Writ Petition No.1272 of 1998, restored it.
Eventually, through its order, dated 17th July 1998, in CA. No.22498 of
1998, once again this Court has nullified the observations. So that
observation has perished.
30. In Manika Dei and Ramachandra Sahu of Orissa High Court,
Vafati Lalmohamed of Gujarat High Court, Globe Publications of Punjab
and Haryana High Court, and Laxman Vitthal Rewankar of this Court
hold that the finding as to the relationship of landlord and tenant given
by the Authority under the Rent Control Act is the finding given by a
‘’court of limited jurisdiction’’ and operates as “resjudicata’’
in the
subsequent suit.
31. In Bharamappa Nemanna Kawale, the Supreme Court has
held that if the ‘Decree’ held by a party who is not the tenant has

become final, it is not open to another party to contend in the executing
Court that the first party is still a tenant. But this decision presupposes
that the ‘decree’ was by a competent court. Otherwise, as it is wellknown,
the observations, or even findings, by a court without
jurisdiction are of no consequence.
32. This Court in Krishnabai has noticed that the landholders
elected to choose one of the two inconsistent remedies and obtained
relief under one statutory provision. It was on the footing that the
occupier was their tenant. In that context, the Court has held that the
landholders, then, could not approbate and reprobate and contend in
other proceedings that the occupier was never their tenant but only a
partner in cultivation. Such a plea would be barred by principles of res
judicata because of the previous order.
33. Here, the landlady all along contended that Shrikant was a
licencee. She contended before the Civil Court that her remedy before
the Authorities was barred by limitation. Then the Civil Court has held
that the case was not barred under any law. She could have her
remedies against the “licencee.”
34. In Gulabchand Chhotalal Parikh v. State of Gujarat20, the
Supreme Court has held that the general principles of res judicata will
apply to a decision on merits in a Writ Petition. Subsequent Suit is
barred. In Centre of Indian Trade Unions, this Court has held that the
doctrine of res judicata is not confined to civil suits; it applies to writ
petitions, too. Then, after explaining the doctrine, this Court has further
held that constructive res judicata applies to PILs. In Choudhary Sahu,
the Supreme Court has held that if no appeal is filed, a decree or order
becomes final.
35. Here, the Civil Court rejected the plaint; it was on the ground
that the landlady, as per her pleadings, must have another statutory
remedy, and for that the forum was different. Then, after an initial
20AIR 1965 SC 1153

aborted attempt to challenge that order or decree, the landlady chose to
have the remedy the Civil Court held available.
36. Now we will turn to the suits. In Civil Suit No. 8 of 1995, the
trial Court, through its judgment dated 24.06.2003, rejected the suit. It
seems that was in response to Shrikant’s application under Order 7,
Rule 11 of CPC. It has mostly recorded the rival contentions about
Shrikant’s status or the nature of the agreement. Its employing
“admittedly” more than once for both the rival contentions may have to
be understood in that context. But it dismissed the suit, as I gather,
based on Mrs. Bhat’s pleadings: “the pleadings are sufficient to infer
that the Civil Court does not have any justification to entertain to suit
for possession and arrears of license fees as claimed by the plaintiff.”
37. This Court in WP No. 346 of 2004 has only held that Mrs.
Bhat has an alternative remedy. Once the Civil Court has rejected a
plaint or even the very suit on the grounds that it has no jurisdiction, it
becomes coram non judice. In other words, a court declaring itself
coram non judice, yet declaring some right, if it were, is nothing but a
contradiction in terms. A judicial oxymoron. So, I reckon there is no
declaration about Shrikant’s status.
38. The past litigation put behind, now I will focus on the
impugned order and its legality.
The Present Litigation:
What is Challenged?
39. Shrikant assails the Order, dated 3rd March 2006, passed in
Appeal No.166 of 2005 by the learned Additional Commissioner, who is
the Revisional Authority under Section 44 of the Maharashtra Rent
Control Act 1999. That order confirms the Competent Authority’s Order,
dated 29th January 2005, passed under Section 24 of the Act. So the
challenge is against the concurrent findings.
What is the Subject?

40. Shrikant has been occupying the first floor of a residential
property belonging to Jayant, the present owner. His mother let him in.
Shrikant claims that he has been in exclusive possession of the property
since 1986. So he asserts he is a lessee. The possession is undisputed,
but his status is. Contrary to Shrikant’s claim, the landlady and, later,
her son Jayant maintain that he is a licencee who must vacate.
On What Basis?
41. Mrs. Bhat and Shrikant signed an agreement on 1st June
1986. The primary dispute is about the nature of the agreement: is it a
lease deed or a leave and licence agreement? Even the duration is a
bone of contention. The Agreement was initially supposed to be for
three years—from 01.06.1986 to 31.05.1989. But Shrikant contends
that it was intended to be for an indefinite period since the landlady
was occupying the rest of the whole bungalow along with her husband,
who was then alive.
Issue No.2: Does the Agreement, dated 1st June 1986, if treated as a lease
deed, require registration?
42. Section 17(1)(d) of the Registration Act and Section 107 of
the Transfer of Property Act provide that leases of immovable property
from year to year or for any term exceeding one year or reserving a
yearly rent can be made only by a registered instrument. Particularly
Section 107 of TP Act mandates:
“A lease of immovable property from year to year, or for any term
exceeding one year or reserving a yearly rent, can be made only
by a registered instrument.
43. Section 49 of the Registration Act, 1908, sets out the effect of
nonregistration
of documents required to be registered. That Section
reads:
“49. Effect of nonregistration
of documents required to be
registered:

No document required by section 17 or by any provision of the
Transfer of Property Act, 1882 (4 of 1882), to be registered shall
(a) affect any immovable property comprised therein, or
(b) confer any power to adopt, or
(c) be received as evidence of any transaction affecting
such property or conferring such power, unless it has been
registered:
Provided that an unregistered document affecting immovable
property and required by this Act or the Transfer of Property Act,
1882 (4 of 1882), to be registered may be received as evidence of
a contract in a suit for specific performance under Chapter II of
the Specific Relief Act, 1877 (3 of 1877), or as evidence of any
collateral transaction not required to be effected by registered
instrument.”
44. Let us examine Section 49 of the Registration Act. This
provision describes the “effect of nonregistration
of documents
required to be registered.” If we assume that a document requires
registration under Section 17 or under the Transfer of Property Act, but
it has not been registered. Then, that document cannot (a) affect any
immovable property shown in the document; or (b) confer any power to
be adopted, or (b1) be received as evidence of any transaction affecting
the property shown in the document. Here, an agreement of lease, if it
were, needs to be registered.
45. But Section 49 provides for exceptions. The unregistered
document “may be received as evidence of a contract in a suit for
specific performance,” or as evidence of any collateral transaction not
required to be effected by a registered instrument. Interpreting Section
49 of the Registration Act, the Supreme Court in SMS Tea Estates
Private Limited v. Chandmari Tea Company Private Limited[21] has held
that “a collateral transaction is not the transaction affecting the
immovable property, but a transaction which is incidentally connected
with that transaction.”
46. We may as well examine the semantic significance of “affect”
21[] AIR 2011 SC 4484

in Section 49 of the TP Act. In Atluru Saraswatamma v. Atluru
Paddayya[22], in 1923, a Division Bench of the Madras High Court has
held that all sorts of transactions may remotely affect the immovable
property. So Section 49 of the Registration Act must be read in the light
of Section 17 of the same Act and Section 91 of the Evidence Act. If this
is done, the word "affecting" will be seen to be only a compendious term
for expressing the phrase "purporting or operating to create declare,
assign, limit or extinguish, whether in present or in future, any right,
title or interest whether vested or contingent." And leasehold right is a
right under Section 49 of the TP Act.
47. In Anthony, the Supreme Court has held nonregistration
of
the document produces only two consequences. One is that no lease
exceeding one year is created. The other is that the instrument becomes
useless for creating any lease. But the presumption that a lease not
exceeding one year stands created by the conduct of the parties remains
unrebutted. In that context, Anthony has also observed that to the
parties to an unregistered lease deed, the Rent Control Act does apply.
48. So the conclusion is that the agreement, dated 1st June 2008,
ought to have been registered if it were treated as a lease deed.
(a) Is NonRegistration
a Curable Defect?
49. A learned Full Bench of this Court in Hemendra Rasilal Ghia
v. Subodh Mody[23] has categorized, in paragraph 71 of the judgment,
the objections about document marking into three categories: (i) the
objection to the documents insufficiently stamped; (ii) the objection
about the mode of proof; and (iii) the objection about the document ab
initio inadmissible in evidence. In view of Section 17 (1) (d) of the
Registration Act and Section 107 of the TP Act, read with Section 49 of
the same Act, a document which requires registration but has not been
22[] AIR 1923 Mad 297
23[] 2008(6) Mh.L.J. 886

registered renders itself ab initio inadmissible. It is unlike insufficient
stamp duty, which is curable.
(b) Can this Objection be raised at any Stage?
50. Nonregistration
vitiates a document; it robs the document of
both its solemnity and value. It can affect no immovable property
shown in the document, nor can it be received as evidence of any
transaction affecting the property shown in the document. As the
document is ab initio inadmissible, the objection can be raised at any
stage.
(c) What is Collateral Purpose under Section 49 of the TP Act?
51. Suffice it to refer to Rana Vidya Bhushan Singh v. Ratiram[24].
A threeJudge
Bench of the Supreme Court has held that a document
required by law to be registered is inadmissible as evidence of a
transaction affecting the immovable property if it is unregistered. But it
may be admitted as evidence of collateral facts, or for any collateral
purpose. Then, in the context of that case, as is here, their Lordships
have held that if an agreement was unregistered, it could not create in a
party’s favour, say, the right of tenancy for a ‘specified period.’ The
agreement, to that extent, is inadmissible in evidence. “But in support
of the plea that his possession was that of a tenant”, the party could rely
upon the recitals in that agreement of lease.
52. That said, neither Mrs. Bhat, the original landlady, nor her
son and successor, Jayant, the present landlord, is prepared to agree
that it is a lease deed. They maintain that it is a leave and licence
agreement. Does the agreement, dated 1st June 1986, pass muster as a
deed of licence?
Issue No.3: What is Agreement, dated 1st June 1086: is it a lease deed or
a leave and licence agreement?
53. For this purpose, we should construe that document. Ext. C is
the agreement. The title of the document reads: “Agreement in respect
24[] 1969 (1) UJ 86

of Residential Premises.” Then, it describes the purpose of the
agreement. In May 1986, the landlady’s son, that is the respondent in
this writ petition, was transferred to another place. At the same time,
Shrikant needed some accommodation. So the landlady gave the
residential portion (described) “for use.” The period of the agreement is
three years—to end on 31st May 1989. Then, Shrikant must hand over
the premises “in the condition in which the same was taken in
possession along with material.”
54. The conditions of the agreement were enlisted: (a) Shrikant
should deposit with the landlady Rs.20,000/.
It would be returned on
31st May 1989, after her taking the possession back. (b) For using the
premises, Shrikant must pay Rs.1,000/per
month in advance. (c)
Shrikant should pay the electricity charges; until a meter was received
from MSEB, he should pay the electricity charges as per the submeter.
(d) No changes could be made to the premises without the landlady’s
leave. (e) No obstacle should be created on the staircase. (f) The
bathroom on the first floor (where Shrikant lives) should not be used
for washing clothes and utensils. Now comes the most important
condition, and it reads:
(8) (a) However, before completion of the period of this
agreement, if my son gets transfer, I will require the place. In
these circumstances you will have to leave the place before
completion of the period of agreement.
(n) If I require possession of the place before completion of the
agreement/or if you want to leave the place before the
completion of the limitation, a notice of minimum one month will
have to be given by both.”
55. As respondent Jayant contends the agreement is contentneutral.
It has no telltale
expressions such as lease, rent, possession,
enjoyment, and so on. Nor does it have expressions like licence,
permission, and so on either, for us to conclude that it is a licence. First,
it is in the vernacular; second, it is the translation provided by the
petitioneroccupier,
who is facing eviction. The owner does not object to

any expressions in the translation. Fairness belongs to the counsel that
translated the document at whatever level of the litigation.
56. The agreement speaks of a stopgap
arrangement until her
then transferred
son came back. Though the agreement period was
three years, it was tentative. It was actually coterminous with her son’s
return. Plainly put, three years or her son’s return, whichever is earlier.
True, the landlady’s son did not return in three years, nor did she seek
the possession at the end of the agreement period. With hindsight, we
may note that if she had asked then for the return of possession, this
litigation would have started a little earlier than it actually started.
Noting more.
57. The agreement employs the expression “use” rather than
“enjoy”. Standing alone, the expression “use” is devoid of any specific
connotation and valueneutral.
Contrasted, But “enjoying” is “using as
one likes”. So “use” is permissive and “enjoy” is pervasive. Shrikant
could use the premises. Shrikant had to pay the electricity charges. The
landlady assured him a separate meter. So Shrikant insists that the
arrangement showed the parities’ intention. I am afraid nothing turns
on it. The meter, if arranged, was to ensure the charges were calibrated
separately.
58. There are restrictions on the use of the property: no obstacles
on the staircase; the bathroom on the first floor (where Shrikant lives)
should not be used for washing clothes and utensils.
59. There are two conditions that dealt with how the agreement
should terminate. The former stipulated that if the landlady’s son
returned before three years, Shrikant had to leave the place. The latter
condition provided for one month’s notice. If either party to the
agreement wanted to terminate the agreement before the threeyear
period, she or he should give one month’s notice. Do these two
conditions contradict? They do not.

60. The former condition is categorical; it admits of no ambiguity.
The return of the landlady’s son would spell the doom for the
agreement. That was nonnegotiable.
Besides that, for any other reason,
if either party to the agreement wanted the contract to end, then the
noticeperiod
was stipulated.
(a) What distinguishes a lease from a licence?
61. Section 105 of the TP Act defines “lease.” It is a transfer of a
right to enjoy any immovable property. Under Section 108 of that Act,
the lessee is entitled to be put in possession of the property. On the
other hand, Section 52 of the Easements Act, defines “licence” as a
grant from person to another, a right to do, or continue to do, in or
upon the immovable property of the grantor, something which would,
in the absence of such right, be unlawful. And such right does not
amount to an easement or “an interest” in the property. The crux of the
lease is the creation of interest in the property; the crux of the licence is
its absence—the absence of any interest in the property. In the lease,
enjoyment is the prerogative, and in the licence it is permissive.
62. There is a marked distinction, declares the Supreme Court in
Associated Hotels of India Ltd. v. R.N. Kapoor, between a lease and a
license. A lease is, the decision holds, transferring an interest in land.
The interest transferred is called the leasehold interest. The lessor parts
with his right to enjoy the property during the term of the lease, and the
lessee gets that right to the exclusion of the lessor. Taking the above
discussion forward, K. Subba Rao J (as his Lordship then was) in his
concurring opinion, has also noted the statutory contours of Section 52
of the Indian Easement Act.
63. After analysing the above provision, Associated Hotels
observes that if a document gives only a right to a person to use the
property in a particular way or under certain terms while the property
remains in the owner’s possession and control, it will be a license. The
legal possession, therefore, continues to be with the owner, but the

licensee is permitted to use the premises for a particular purpose. “But
for the permission, his occupation would be unlawful.” Associated Hotels
observes that the license does not create in the licensee’s favour any
estate or interest in the property.
64. Acknowledging the conceptual confusion about the nature of
the licensee’s possession, Associated Hotels observes that “the dividing
line [between a lease and license] is clear though sometimes it becomes
very thin or even blurred.” Then, it refers to the oncefavoured
test of
exclusive possession as an infallible measure to determine the nature of
possession. After referring to a handful of English caselaw, Associated
Hotels enlists the tests that can determine whether a transaction is lease
or license: (a) To ascertain whether a document creates a license or
lease, by preferring substance of the document over the form; and (2)
to ascertain the intention of the parties—that is, whether they intended
to create a lease or a license. Then, it rules that if the document creates
an interest in the property, it is a lease; but if it only permits another to
use the property, of which the legal possession continues with the
owner, it is a license. On the other hand, if under the document a party
gets exclusive possession of the property, prima facie, he is considered a
tenant; but circumstances may be established which negative the
intention to create a lease.
65. In C.M. Beena v. P.N. Ramachandra Rao[25], the Supreme
Court has held that a few principles are well settled. User of the terms
like 'lease' or licence', 'lessor' or 'licensor', 'rent' or 'licence fee' are not by
themselves decisive of the nature of the right created by the document.
An effort should be made to find out whether the deed confers a right
to possess exclusively coupled with the transfer of a right to enjoy the
property, or it is merely a right to use the property while the owner
retains the possession. The parties’ conduct before and after the
25[] AIR 2004 SC 2103

creation of the relationship is relevant for our discovering their
intention.
66. In Delta International, the Supreme Court has exhaustively
examined the concept of “intention” of the parties to a deed. It has held
that the intention must be gathered from the words they have used, and
there could be no intention independent of that meaning. Recently, the
Supreme Court in Sevoke Properties has held that the only purpose for
which an unregistered lease can be looked at is for assessing the nature
and character of the occupier’s possession.
67. Here, Mrs. Bhat allowed Shrikant to “use” the property. She
dictated what Shrikant should do and should not do: he was enjoined to
use even the bathroom only in a particular way. He was asked to leave
the property the movement Mrs. Bhat’s son came back on a transfer, the
agreement period notwithstanding.
68. Now, I will also refer to the decisions Shrikant has cited.
Sohan Lal Naraindas. In that case, the document is titled ‘leave and
licence agreement.’ But on facts, the Supreme Court notes that the
defendant was put in exclusive possession of the loft. There is no
evidence that the loft was given to the defendant out of sympathy or
because of friendship, or relationship, or any similar motive. It was
stipulated that the plaintiff may terminate the agreement by giving one
month's clear notice, the agreement could not be terminated by notice
of a shorter duration.
69. Here, the residential portion was let out only as a stopgap
arrangement, and the licence was terminable on the happening of a
contingency. That contingency—the return of the landlady’s son—will
terminate the agreement, the agreement period notwithstanding.
Besides that, there have been restrictions on the use: for example, how
and only for what purpose the bathroom could be used.
70. In Tulsi, the Supreme Court has held that a licensee gets the
possession only with the consent of the licensor and is liable to vacate

when so asked. Then, Shrikant contends that he has had uninterrupted
possession. According to him, though the alleged licence expired in
1989, until 1994 his possession had not been disturbed. That said, once
it is a licence, merely because the licensor has not asked the licencee to
vacate soon after the licence period does not transform the licence into
lease. The length of the period is not, I must say, a determinative factor.
71. In Achintya Kumar Saha, the Supreme Court has reiterated
that the nature of lease and licence to be gathered from surrounding
circumstances. In Amratlal Valji, this Court has relied on the Supreme
Court’s proposition in C.M. Beena’s case. It has held that the difference
between lease and licence is to be determined based on the document
and surrounding circumstances.
(b) What sort of possession does the occupier have?
72. Shrikant contends that it would have been impossible for him
to enjoy the property, had he not been in possession. A person’s
occupying a residential property speaks volumes about that occupier’s
possessing the property, and enjoyment without possession, according
to him, is unthinkable and impracticable.
73. In this context, I may note that there are many shades of
possession: say, corporeal possession, incorporeal possession,
constructive possession, adverse possession, de facto possession, de jure
possession, mediate possession, and immediate possession. Indeed,
immediate possession is a direct or primary possession. The person in
direct possession has a higher control over the thing possessed. It means
there is no intermediary or medium. On the contrary, if someone
possesses something through another, the thing remains in possession
of another. That is, the possessor has a lesser control over the thing he
has physically possessed, though.
74. Lexically speaking, ‘possession’ is a chameleonhued
word. G.
W. Paton in his A Textbook of Jurisprudence has ‘pessimistically states’

that the search for its proper meaning is likely to be a fruitless one.[26]
The expression 'possession' is a polymorphous term which assumes
different colours in different contexts. It may carry different meanings
in contextually different backgrounds. It is impossible, as was observed
in Superintendent & Remembrancer of Legal Affairs, West Bengal v. Anil
Kumar Bhunja[27], to work out a completely logical and precise
definition of "possession" uniformly applicable to all situations in the
context of all statutes.
75. As noted in Gunwantlal v. The State of M.P.[28], possession in
a given case need not be physical possession but can be constructive,
having power and control over the article in case in question, while the
persons to whom physical possession is given holds it subject to that
power or control. That is, the word 'possession' means the legal right to
possession. In an interesting case, it was observed that where a person
keeps his firearm in his mother's flat which is safer than his own home,
he must be considered to be in possession of the same. (See Sullivan v.
Earl of Caithness.[29]
76. Here, I must hold that what Shrikant has is mediate
possession, like the mother’s possessing the son’s firearm in Sullivan. To
conclude, his possession is mediate and permissive.
Issue No.4: Marking of the Previous Depositions in Other Cases Between
the Same Parties: Does it amount to Substantive Evidence?
77. At any rate, to countervail Mrs. Bhat’s assertion that it is a
licence, what evidence has Shrikant led? Once the plaintiff discharges
the primary evidential burden, then it is a matter of shifting onus. It
does not remain constant; it swings like a pendulum between the
parties. Shrikant did not get into the witness box. Instead, he merely
26[] As quoted in Garner’s Dictionary of Legal Usage, OUP, 3rd Ed.,
p.688
27[] 1979 Cri LJ 1390, as quoted in State of Punjab vs. Hari Singh:
(2009) 4 SCC 200
28[] 1972 Cri LJ 1187, as quoted in Hari Singh (supra)
29[] 1976 (1) All ER 844 (QBD), as quoted in Hari Singh (Supra)

produced a bunch of documents, mainly the depositions of the parties
including his own, from the earlier rounds of litigation. Did that amount
to his discharging the burden? I reckon Section 33 of the Evidence Act
answers this question.
78. According to Section 33 of Evidence Act, evidence given by a
witness in a judicial proceeding is relevant for proving, in a subsequent
judicial proceeding, or in a later stage of the same judicial proceeding,
the truth of the facts which it states. That said, for a person to place
that piece of evidence in the subsequent judicial proceedings, (a) the
witness must have been dead, or (b) cannot be found, or (c) is
incapable of giving evidence, or (d) is kept out of the way by the
adverse party, or (e) the witness’s presence cannot be obtained without
an amount of delay or expense which, under the circumstances of the
case, the Court considers unreasonable. Further, the proceeding must
be between the same parties or their representatives in interest; the
adverse party in the first proceeding must have had the right and
opportunity to crossexamine;
and the questions in issue were
substantially ought to be the same in the first as in the second
proceeding.
79. I see no such contingency as provided in Section 33 of the
Evidence Act met here. Shrikant’s mere marking the depositions before
the Competent Authority, I am afraid, is of no consequence. The record
does not reveal that the marking was with the adversary’s consent.
Issue No.5: Have the Competent Authority and Revisional Authority
Committed any Jurisdictional Error requiring this Court’s Judicial
Intervention?
80. First, Mrs. Bhat invoked Section 24 of the MRC Act and
approached the Competent Authority, who passed an order of eviction
on 29th May 2005. He passed the order under Section 43 of the MRC
Act. Then, Shrikant invoked Section 44 of the same Act. First, the
Competent Authority’s order is nonappealable.
Second, what the

Divisional Authority exercises under Section 44 of the MRC Act is
revisional power. Once the licnce expires, the landlord or the landlady,
under Section 24, can recover possession of premises given on licence.
81. Section 44 of MRC Act is under Chapter VIII. That chapter
concerns “Summary Disposal of Certain Applications.” To begin with,
Section 39 declares that the provisions of Chapter VIII, which include
both Sections 43 and 44, have an overriding effect. They shall have an
effect “notwithstanding anything inconsistent therewith contained
elsewhere in the Act or in any other law for the time being in force.”
82. Under Section 44, the Additional Commissioner of a Revenue
Division, may, at any time, suo motto or on the application of any
person aggrieved, can exercise its revisional power. It is only for
“satisfying itself that an order made in any case by the Competent
Authority under section 43 is according to law.” To ascertain that the
Competent Authority’s authority has acted under the law, the Revisional
Authority can “call for the record of that case and pass such order in
respect thereto as it or he thinks fit.”
83. Thus, in the first place, the primary adjudication under
Section 24 of MRC Act itself is summary. And over that summary
adjudication, Section 44 of the Act provides for revisional powers to the
Additional Commissioner.
84. In Malini Ayyappa Naicker v. Seth Menghraj Udhavadas[30], a
threeJudge
Bench of the Supreme Court has examined a similarly
worded provision—Section 75 of the Provincial Insolvency Act (“the
Insolvency Act”). Malini Ayyappa Naicker has held that the Legislature
did not confer on the High Court under Section 75(1) of the Insolvency
Act an appellate power, nor did it confer on it jurisdiction to
reappreciate the evidence on record. While exercising that power, the
High Court is by and large bound by the findings of fact reached by the
District Court. If the legislature intended to confer power on the High
30[] (1969) 1 SCC 688

Court to reexamine
both the questions of law and fact, it would have
conveyed its intention by appropriate words, as has been done under
various other statutes.
85. In this context, Malini Ayyappa Naicker has held that “a
wrong decision on facts by a competent court is also a decision
according to law.” A decision being “contrary to law” as provided in
Section 100(1)(a) of the Code of Civil Procedure, it has further held, is
not the same thing as a decision being not “according to law” as
prescribed in Section 75(1) of the Insolvency Act. Though Malini
Ayyappa Naicker has not defined the expression “according to law”, it
has quoted with approval Bell & Co. Ltd. v. Wamen Hemrai[31]. This
Court in Wamen Hemrai has given a few instances when the High Court
may check whether a decision is according to law: If the court or
tribunal had no jurisdiction, or it has based its decision on evidence
which should not have been admitted, or it has not given the
unsuccessful party a proper opportunity of being heard, or it has cast
the burden of proof on the wrong shoulders.
86. Here I see none of the instances pointed out in Malini
Ayyappa Naicker. The concurrent findings of both the Competent
Authority under Section 24 of the MRC Act and of the Revision
Authority under Section 44 of the same Act suffer from no legal
infirmities to be interfered with by this Court under Article 227 of the
Constitution of India.
As a result, the writ petition is dismissed with costs.
[DAMA SESHADRI NAIDU, J.]
31[] (1938) 40 Bom LR 125

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