IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 11TH DAY OF JULY 2019 BEFORE THE HON’BLE MR. JUSTICE SREENIVAS HARISH KUMAR HRRP No.31 OF 2011 BETWEEN Sri. C.S.Sheshagiri S/o. Late C.Subraya Sastry, Aged about 71 years, Residing at No.27/2, Ramakrishna Street, Seshadripuram, Bengaluru-560020.
(By Sri T.V.Vijay Raghavan, Advocate) AND Smt. Jayalakshmi @ Jayalakshmamma, Since deceased by LRs, Sri Mohan Chandra S/o. Late M.E.Rajagopal Aged about 64 years No.88, 2nd Floor, Out House, 1st Main Road, 9th Cross, Chamarajpet, Bengaluru-560018.
(By Sri Rameshchandra, Advocate) …Petitioner …Respondent This HRRP is filed under Section 46(1) of the Karnataka Rent Act, against the order dated 20.01.2011 passed on I.A.No.III in HRC No.299/2008 on the file of the 18th Additional Judge, Court of Small Causes, Bengaluru, (SCCH 4), dismissing the I.A.No.III filed under Section 43(1) and (2) of the Karnataka Rent Act 1999.
This HRRP coming on for final hearing this day, the court made the following:
ORDER In an eviction petition instituted against the petitioner by the respondent under Rent Control Act, the former disputed the jural relationship of landlord and tenant and in that regard he made an application under section 43 of the Karnataka Rent Act seeking to stop all further proceedings and to direct the parties to approach the competent court of civil jurisdiction for declaration of their rights.
2. The ground on which the petitioner disputed his tenancy under the respondent is that though he occupied the premises as a tenant at the inception, there came into existence an agreement of sale dated 14.5.1979 between him and the respondent. He agreed to purchase the premises for a valuable consideration and that he took over the possession of the premises in part performance of the agreement. Therefore, his relationship with the respondent as a tenant ceased with the execution of the agreement of sale. When the respondent breached the contract, he filed a suit for specific performance, O.S.3507/1997 against the respondent and obtained a decree in his favour on 2.7.2003. The respondent preferred an appeal against the decree to this court in RFA 89/2004. This court reversed the judgment of the trial court and dismissed the suit for specific performance. The petitioner’s further case is that although the decree in the suit was reversed by the High Court, he continued to be in possession of the premises. The judgment in appeal did not automatically result in revival of the earlier relationship of landlord and tenant and if at all the respondent was entitled to possession of the premises, he should obtain it by instituting suit for possession in the Civil Court and the eviction petition under the Rent Control Act is not maintainable.
3. The trial court by its order dated 20.1.2011 dismissed the said application and hence this revision petition. It has recorded the following findings:-
Clause 9 of the agreement between the parties shows that the purchaser (petitioner herein) would get possession of the petition schedule premises at the time of registration of sale deed. That means the agreement does not show that possession was handed over to the purchaser in part performance of the agreement. Then in view of judgment of this court in RFA.89/2004, the suit for specific performance stood dismissed and consequently the agreement came to an end. The vendor (the respondent herein) was directed to refund the advance amount of Rs.27,000/- with interest at the rate of 6%, and the vendor complied with the direction. In these circumstances the relationship of landlord and tenant as it existed prior to coming into being of agreement would revive.
4. Sri. T.V. Vijayaraghavan, the learned counsel for the petitioner assails these findings; his argument is that with the dismissal of the suit for specific performance by virtue of judgment in RFA, the earlier status of the petitioner as that of tenant did not revive. The agreement very clearly recites conferring possession on the petitioner by virtue of the agreement of sale. Dismissal of the suit for specific performance did not result in taking away the right of the petitioner to protect his possession which was delivered to him in part performance of the agreement. The petitioner never paid the rent in view of possession being delivered to him under the agreement. Therefore the trial court should not have given a finding that the tenancy revived. In support of his argument, he has referred to some rulings which will be referred to while assigning my reasons.
5. Sri. Rameshchandra, the learned counsel for respondent argued for sustaining the findings of the trial court. His argument is that the agreement does not disclose delivery of possession to the petitioner in part performance of the agreement. Clause 9 of the agreement clearly states the possession would be handed over after execution of the sale deed. The petitioner cannot take advantage of being in possession of the premises as a tenant to contend that he was allowed to remain there in part performance of the agreement without paying rent. In fact the petitioner paid rent to the respondent up to the year 1981, even after execution of the agreement. There may not be any document, but the very fact of claiming arrears of rent from the year 1981 probabalizes the respondents’ stand. Therefore it is his argument that circumstances do not indicate surrender of possession by the petitioner as a tenant the moment agreement was executed. In this view, there exists the jural relationship of landlord and tenant. He too has placed reliance on some decided cases in support of his argument.
6. The point therefore to be answered is whether there was revival of tenancy with the dismissal of suit for specific performance by this court in RFA.89/2004?
7. Before answering this point, if the decisions relied upon by the learned counsel, Sri. T.V. Vijaya Raghavan are referred to, this court in the case of B. Paramashivaiah Vs. M.K.Shankar Prasad (2009 (3) KLJ 319) has held:-
“20. Section 53-A of the said Act provides for a situation whereby a party to a transaction, which is in writing has taken possession of the property or any part there of in part performance of the said contract or if he is already in possession continues in possession in part performance of the said contract and thus in furtherance of the contract and is willing to perform his part of the contract, then he is entitled to defend his possession by virtue of the contract or agreement under which he is put in possession of the property. It is obvious that a tenant has no right to seek protection of his possession by virtue of Section 53-A of the Transfer of Property Act when a jural relationship is that of landlord and tenant and that the Rent Act would prevail and the landlord could seek eviction in terms of the provisions of the said Act. But where a tenant is in possession of the premises by virtue of an agreement and does certain acts in furtherance of the said agreement, in my view the relationship of landlord and tenant would cease from the date of the agreement and would be replaced by a new relationship of intending purchaser and seller and under the circumstances Section 53-A of the Transfer of Property Act enables such a person in possession of the premises by virtue of the agreement or contract to defend his possession. Hence the answer to the incidental question raised for my consideration is that the petitioners herein are entitled to defend their possession by virtue of the agreements dated 03.03.1993 as that the respondents/landlords had no right to evict the petitioners by virtue of the provisions of the Karnataka Rent Act”.
8. The Hon’ble Supreme Court in the case of R.Kanthimathi and Others Vs. Mrs. Beatrice Xavier (AIR 2003 SC 4149) has held as below :
“5. Submission for the tenant is after entering into the agreement, the landlady accepted Rs. 20,000/- confirming delivery of possession in this context which clearly constitute clear intend of the landlady of entering into new relationship with the tenant under it. On the other hand, learned Counsel for the respondent submits that the words "already been surrendered" therein, only refer to the existing possession of the tenant and nothing more. So far this submission for the respondent we have no hesitation to reject the same. The reference of the words "already been surrendered" has been incorporated with consciousness. This is to be construed in the background of landlady having received major amount of sale consideration and as normally, if substantial sum is received by the seller, the purchaser is put in possession of the property hence to fall in the same lines the said words were used to confirm of this possession in this context. There could be no other reason to record therein as such. Even if it be said to refer to the possession's as a tenant the reassertion in the agreement of sale is only for the purpose of denoting possession given in pursuance to this agreement of sale.
6. Any jural relationship between two persons could be created through agreement and similarly could be changed through agreement subject to the limitations under the law. Earlier when appellants were inducted into tenancy it only means both agreed that their relations is to be that of a landlord and tenant. Later when landlord decides to sell this property to the tenant and tenant agreed by entering into agreement they by their positive act changed their relationship as purchaser and seller. When seller- landlord accepts sum he actually acts under this agreement. This acceptance preceded by agreement of sale changes their relationship. This is how they intended. Once accepting such a change then their relationship of landlord tenant ceases”.
9. Another judgment of the Supreme Court in the case of Shrimant Shamrao Suryavanshi and Another Vs. Prahlad Bhairoba Suryavanshi (D) by LRs and Others, 2002 (3) KCCR 1457 discusses the protection available to a transferee of possession of an immovable property according to Section 53A of the Transfer of Property Act. In this judgment, point akin to the one involved in this case did not arise, and this judgment may not be any avail to the petitioner.
10. On a perusal of the decision cited by Sri.
Rameshchandra, the Supreme Court, in the case of D.S.Parvatamma Vs. A. Srinivasan (AIR 2003 SC 3542) has, in a circumstance identical with the facts of this case, has held:
”9. ………But that does not mean that till a final decision has been reached the contract creates a right in the person in possession, i.e. the tenant, to refuse to surrender possession of the premises even if such possession was obtained by him not in part performance of the contract but in his capacity as a tenant. Having entered into possession as a tenant and having continued to remain in possession in that capacity he cannot be heard to say that by reason of the agreement to sell his possession was no longer that of a tenant. (Also see Dakshinamurthi Mudaliar (Dead) & Ors. Vs. Dhanakoti Ammal, AIR 1925 Madras 965 and A.M.A. Sultan (deceased by LRs) & Ors. Vs. Seydu Zohra Beevi, AIR 1990 Kerala 186). In our opinion the law has been correctly stated by the High Court of Madhya Pradesh in the above said decision”.
11. While discussing the aspect whether creation of a mortgage transaction between the lessor and the lessee would bring to an end the prior contract of lease, the Supreme Court, in the case of Nirmal Chandra Vs. Vimal Chand (AIR 2001 SC 2284) has held :
“7. ………On facts it was found that rent was payable by the lessee in the shape of share in the crop and there was an adjustment of rent and interest that is to say liability to pay rent during mortgage was kept alive which runs counter to implied surrender of lease rights. It was further held that the mere fact that owner creates a mortgage in favour of a lessee is not by itself decisive to hold that the prior lease was surrendered and the possession on the earlier lease was only that of a mortgagee. The nature of possession would however be a question of fact in each case”.
12. On an earlier occasion, the Division Bench of this court in the case of Manchamma @ Rukmini Vs. M.T. Narayana Gowda (WA.3579/2005) dealt with a situation identical to the facts in the instant case and held as below:
“12. Hon’ble Supreme Court in D.S.Parvathamma Vs. A.Srinivasan (A.I.R. 2003 S.C.3542) had an occasion to deal with the relevant provisions of Sec 53-A of the T.P.Act has ruled that when a party as a tenant of the suit house claiming himself to be in possession of the suit house under the part performance of the agreement to purchase and when the suit filed by him for specific performance was dismissed on the ground that he is not ready and willing to perform his part of the agreement and when he has failed to prove that possession was delivered to him under the part performance of the contract, such possession cannot be protected. In the instant case also though respondent has relied upon an agreement dated 23.09.1983, recital of the agreement does not disclose the ingredients of Section 53-A of the Act. When he has failed to prove that he is in possession of the property under the part performance of the agreement and when he has not filed a suit for enforcing agreement from 1983 till today, it would be difficult for a court to hold that he is in possession of the property under the part performance of the agreement”.
13. The analization of the case law referred to above leads to hold the view that a tenant or a lessee to be able to claim protection under Section 53A of the Transfer of Property Act and assert that the relationship of landlord and tenant came to an end, what is required to be proved is cessation of tenancy and continuation of possession in the new status as a prospective purchaser. The lessee having become a purchaser must have been allowed to remain in possession of the property on the basis of new relationship, and if such intention of putting an end to the relationship of landlord and tenant is not forthcoming from the agreement of sale itself, it is difficult to say that with coming into being of an agreement of sale, the jural relationship of landlord and tenant comes to an end automatically. Sometimes, the recitals in the agreement do not disclose the intention, but the conduct of the parties after the agreement becomes relevant, but it is a matter of proof.
14. In this case, the trial court has held that clause 9 of the agreement does not disclose delivery of possession in accordance with Section 53A of the Transfer of Property Act. In my opinion, clauses 8 and 9 of the agreement must be read. They are as follows:
8. There is a tenant in occupation of a portion of the schedule premises, namely portion bearing Door No.27/1. The Sellers have undertaken to get the said tenant vacated forthwith and deliver vacant physical possession of the entire premises concerned herein to the purchaser on the day of registration of the relative sale deed referred to above.
9. Since the sellers propose to deliver vacant possession of the premises concerned herein to the purchaser on the date of registration of the relative sale deed, the sellers and the sellers alone shall be liable to pay all taxes, levies, cesses accruing due and becoming payable up to that date in respect of the premises concerned herein entirely and exclusively”.
(underlining by me) 15. The above two clauses do not disclose possession of the premises being delivered to the petitioner under part performance of the agreement. Merely for the reason that the petitioner was already in possession of the premises for about 11 years, that possession with the execution of an agreement of sale on 14.05.1979, did not bring to an end the petitioner’s possession as a tenant. The suit for specific performance was also dismissed by this court by allowing the first appeal giving a finding that the petitioner was not ready to perform his part of the contract. The respondent was directed to return the earnest money and it was also returned. Therefore the agreement itself came to an end. These circumstances do not entitle the petitioner to claim protection under Section 53 A of Transfer of Property Act and dispute the relationship of landlord and tenant. Therefore I uphold the findings of the trial court.
16. Sri. Rameshchandra, learned counsel for the respondent raised another point relating to petitioner’s right to prosecute the revision petition without depositing the arrears of rent. He refers to Section 45 of the Karnataka Rent Act. Sri. Vijaya Raghavan, learned counsel for the petitioner submits that since relationship of landlord and tenant was at dispute and there was conflict in the decisions in this regard, the petitioner did not deposit. He also submitted that, the petitioner has now deposited the rents and he is not in arrears.
17. Whether a tenant should deposit the rent when he challenges an order passed on application under Section 43(2) of the Karnataka Rent Act? – this controversy is now settled by the Division Bench of this Court in this case itself upon a reference to it [ILR 2016 KAR 1866]. It is held as below:
“Even when a tenant were to challenge an order passed under Section 43 of the Act holding that he is a tenant by way of a revision under Section 46 of the Act, Section 45 is attracted and without paying the rent from the day it fell due till the date of filing the revision petition, tenant cannot maintain the revision petition”.
18. Since it was argued by Sri. Ramachandra that the deposit that has been made by the petitioner was not within the time, this point also requires examination. The principle laid down by the Supreme Court in the case of K.Raghunath Vs. Chandrasekhar and Another [(2005) 9 SCC 624] is very much applicable “9. Counsel for the parties submitted before us that in the absence of a provision providing for a limitation the High Court of Karnataka has held that such a revision must be preferred within 90 days. It was so laid down in the case of P. Kannaswamy Vs B.L. Shankaranarayana Shetty AIR 1977 Karnataka 72. A subsequent decision of the same Court in Obalappa Vs Alamelamma AIR 1983 1 Rent Control Reporter 258 has clarified that the period of 90 days though not a period of limitation prescribed by law, is all the same a guidance for the exercise of discretion in such matters. Without going into the correctness of these decisions we proceed on the basis that a revision could be preferred within 90 days, though Section 50 does not lay down the limitation for preferring such a revision.
10. In view of the above if a revision is filed within 90 days as laid down by the aforesaid decisions of the Karnataka High Court, and the arrears of rent is not deposited within the period of 90 days, the situation poses no difficulty, because in that event the Court may dismiss the revision unless the revisionist is able to satisfy the Court that he had sufficient cause for not making the deposit within such time”.
19. In this case, the ruling of the Division Bench came on 07.01.2016. The first deposit of Rs.40,800/- was made on 22.1.2016, i.e., after setting at rest the controversy.
Therefore this ground of argument is not available to the respondent.
In view of the above discussion on the question of jural relationship of land lord and tenant, I uphold the findings of the trial court. This revision fails and it is dismissed. There is no order as to costs. LCR be transmitted to trial court forthwith.
Sd/- JUDGE ckl