Whether accrued right in favour of landlord can be taken away by tenant by his unilateral act?

In our opinion, the ratio laid down in the above cases applies to the present case as well. Admittedly, on the date the tenancy was terminated, the tenant (Public Limited Company) was having a paid up share capital of rupees more than one crore. Under clause (b) of Section 3(1) of the Act, therefore, the provisions of the Act were not applicable to the suit-premises. It is true that a resolution was passed by the Company to reduce the paid up share capital to less than rupees one crore, but the said resolution was never approved by BIFR. But even otherwise, once it is proved that the tenancy was legally terminated and the Act would not apply to such premises, a unilateral act of tenant would not take away the accrued right in favour of the landlord. Unless compelled, a Court of Law would not interpret a provision which would frustrate the legislative intent and primary object underlying such provision. We, therefore, see no infirmity in the conclusions arrived at by the courts below.

Supreme Court of India

Carona Ltd vs M/S Parvathy Swaminathan & Sons on 5 October, 2007

Bench: C.K. Thakker, P. Sathasivam

           CASE NO.:
Appeal (civil)  2805 of 2005

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Distinction between “privilege” and “accrued right”.

In Isha Valimohamad and Anr. vs. Haji Gulam Mohamad &
Haji Dada Trust 1975 (1) SCR 720 the Supreme Court made a distinction
between “privilege” and “accrued right”.
“Mr. Patel for respondent contended that even if the
landlord had no accrued right, he at least had a 'privilege'
as visualised in Section 51, proviso (1)(ii) of the Bombay
Act and that the privilege should survive the repeal.
A privilegium, in short, is a special act affecting
special persons with an anomalous advantage, or with an
anomalous burthen. It is derived from privatum, which,
as opposed to publican, signified anything which regards
persons considered individually; publicum being
anything which regards persons considered collectively,
and forming a society
(See Austin's Jurisprudence, Vol. II, 5th ed. (1911) P.
519)
The meaning of that word in jurisprudence has
undergone considerable change after Austin wrote.
According to Hohfeld:
... a privilege is the opposite of a duty, and the
correlative of a 'no-right'. For instance, where "X has a
right or claim that Y should stay off the land (of X), he
himself has the 'privilege' of entering on the land; or, in
equivalent words, X does not have a duty to stay off.
Fundamental Legal Conceptions (1923) pp. 38-39)
Arthur L. Corbin writes:
We say that B had a right that A should not intrude
and that A had a duty to stay out. But if B had invited A
to enter, we know that those results would not occur. In

such case we say that B had no right that A should stay
out and that A had the privilege of entering.
(See "Legal Analysis and Terminology", 29 Yale
Law Journal 163)
According to Kocourek:
Privilege and inability are correlatives. Where there
is a privilege there must be inability. The terms are
correlatives. The dominus of a Privilege may prevent the
servus of the Inability from exacting an act from the
dominus
(See "Jural Relations", 2nd ed., p. 24)
Patton says:
The Restatement of the law of Property defines a
privilege as a legal freedom on the part of one person as
against another to do a given act or a legal freedom not to
do a certain act.
(See Jurisprudence, 3rd ed. (1964), p. 256)
We think that the respondent-landlord had the legal
freedom as against the appellants to terminate the
tenancy or not. The appellants had no right or claim that
the respondent should not terminate the tenancy and the
respondent had, therefore, the privilege of terminating it
on the ground that appellants had sub-let the premises.
This privilege would survive the repeal. But the problem
would still remain whether the respondent had an accrued
right or privilege to recover possession of the premises
under Section 13(1) of the Saurashtra Act on the ground
of the sub-letting before the repeal of that Act. The fact
that the privilege to terminate the tenancy on the ground
of sub-letting survived the repeal does not mean that the
landlord had an accrued right or privilege to recover
possession under Section 13(1) of that Act as that right or

privilege could arise only if the tenancy had been validly
terminated before the repeal of the Saurashtra Act.”
(at Pages 725, 726)
It is clear therefore that no accrued right to property was ever vested in the
defaulting member.
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.4354 of 2003

The Stock Exchange, Bombay Vs V.S. Kandalgaonkar & Ors.

Dated;September 25, 2014

R.F.Nariman, J.

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