JUDGMENT - T.D. SUGLA, J.:---The appellant is the original plaintiff. He had filed Suit No. 7176 of 1976 in the Bombay City Civil Court at Bombay praying for a mandatory and other injunction to the defendant to hand, over a mandatory and other injunctions to the defendant to hand over possession of the suit shop No. 38 in the building situate at 341, Tardeo Road, Bombay-400 034. The averments made in the plaint inter alia were that the plaintiff and the defendant were brothers. They were carrying on business of Chana-Kurmura jointly at the abovesaid premises and had joint family properties at their native place in District Azamgarh, U.P. On 23rd October 1972 they had executed an agreement, in terms of which it was agreed to carry on the said business alternatively for one year each, the year commencing from 1st October 1972 to 30th September 1973 and so on. When the plaintiff's turn came to carry on the business in the year 1976, the defendant refused to allow the plaintiff to carry on the said business. That is why the plaint was filed with a prayer for injunction to the defendant to hand over possession of the business premises to the plaintiff. 2. As many as 6 issues were framed by the City Civil Court. The first three issues pertained to the question whether the tenancy rights or any other rights in the suit shop belonged to the parties jointly or to their joint Hindu family, whether the defendant got the tenancy rights transferred in his name wihtout the plaintiff's knowledge and whether the declaration dated 17th April, 1972 was proved. The City Civil Court decided all the three issues agianst the plaintiff. Shri Sathe, the learned Counsel for the plaintiff, did not press the these issues before this Court. In the circumstances, it is not necessary to refer to t he facts pertaining thereto. Issue No. 4 reads thus:--- "Is it proved in the alternative that by an agreement dated 23rd October, 1972 the Defendant agreed to allow the plaintiff to run the shop turn by turn every year as per terms set out in para 7 of this plaint?". The trial Court decided this issue also in the negative and in favour of the defendant.
The trial Court decided this issue also in the negative and in favour of the defendant. As regards thus issue, Shri Sathe, the learned Counsel for the plaintiff, stated that the agreement dated 23rd October, 1972 was admitted by the parties as a genuine agreement and was, thus, bringing on them. Their respective rights, therefore, require to be determined in the light of the said agreement. According to Shri Sathe, though apparently an agreement, it is in reality a family arrangement as the defendant himself admitted it to be so vide -aragraph 13 of the written statement. It was, thus, not open to the defendant to revoke the agreement unilaterally. As regards the alleged breach of the agreement, it is the case of Shri Sathe that the allegation of breach of the agreement was not correct and that no intimation about the alleged breach was given to the plaintiff. In any event, no notice revoking the agreement was ever served on the plaintiff. Mere averment in the written-statement that the agreement was revoked, it was argued, did not amount to the revocation of the agreement. If the plaintiff had committed any breach of the agreement as alleged, the remedy agailable to the plaintiff would have been to claim damages to the extent he suffered on account of breach of the agreement by the plaintiff. The so-called notice dated 30th September, 1976 said to have been issued by the defendant to the plaintiff was, it was pointed out, never served on the plaintiff. That is apart from the fact that the contents of the notice were disputed and denied by the plaintiff in the affidavit in rejoinder dated 14th January, 1977. 3. Smt. Shenoy and Smt. Shastri appeared on behalf of the defendant. It is their case that it was not open to the plaintiff to change his stand before this Court. The plaint was filed primarily on the ground that the business in the suit shop was carried on by the parties jointly or as a joint family business and that the agreement dated 23rd October 1972 was entered into by way of family arrangement between the parties. If the ground that it was a joint family business or business owned by the two brothers jointly is not pressed, the further ground that the agreement dt. 23-10-1972 was a family arrangement would automatically fail.
If the ground that it was a joint family business or business owned by the two brothers jointly is not pressed, the further ground that the agreement dt. 23-10-1972 was a family arrangement would automatically fail. Alternatively, they contended that the arrangement did not even remotely suggest that was a family arrangement. If at all, it could be an agreement of licence by one brother to the other to allow him to carry on business alternatively for a period of one year each with his permission. The agreement was more like a licence under section 52 of the Indian Easements Act, 1882, than a contract. That being so the defendant was entitled to revoke the licence at his will as provided for in section 60 of the said Act. Referring to the fact that the agreement was without any consideration, the attention of the Court was invited to the provisions of section 25(1) of the Indian Contract Act for the proposition that such an agreement was void unless it was in writing and registered under the Indian Registration Act. The agreement was admittedly not registered under the Indian Registration Act. Reference was then made to the provisions of section 17(1)(b) and 17(1)(d) of the Indian Registration Act for the proposition that such an agreement was compulsorily registrable. A compulsorily registrable agreement, if not registered, could not be accepted as evidence of any transaction affecting any property or conferring any power as provided for in section 49 of the Registration Act. The submission, thus, was that the agreement was not and could not be treated as a family arrangement because the fact that it was a family business has not been established. It was either a licence or a contract without consideration. If it was a licence, the licence could be revoked under section 60 of the Indian Easements Act. If it was a contract, it was void and could not be enforced as it was not registered. Inviting further the Court's attention to section 15(1) of the Bombay Rent Act, it was argued that the defendant could not have in law created the plaintiff's interest in the suit shop, a rented premise.
If it was a contract, it was void and could not be enforced as it was not registered. Inviting further the Court's attention to section 15(1) of the Bombay Rent Act, it was argued that the defendant could not have in law created the plaintiff's interest in the suit shop, a rented premise. Emphasis in this context was laid on the conclusion arrived at by the City Court that the business was carried on by the defendant personally and that when the business was started in the year 1955, the plaintiff was only 14 years old. In support of her other submissions, reliance was placed on the Supreme Court decision in the case of (M.N. Clubwala v. Fida Hussain Saheb)1, A.I.R. 1965 Supreme Court 610 and Delhi High Court decision in the case of (Chandulal v. Municipal Corporation of Delhi)2, A.I.R. 1978 Delhi 174. 4. Shri Sathe submitted that it was not always necessary that an agreement should have a narration as regards the original nature of the business or a premise. Facts have to and can be gathered from the document and other evidence on record. He laid emphasis on the statements in paragraph 13 of the written-statement where the agreement was described by the defendant himself as an arrangement. Once it was found to be an arrangement, it could not be revoked. In this context Shri Sathe placed reliance on the observations in head-note (d) of the Allahabad High Court decision in the case of (Pokhar Singh v. Dulari Kunwar)3, A.I.R. 1930 Allahabad 687. According to Shri Sathe, all agreements are not covered by the Indian Contract Act. This is evident from the plain reading of the preamble of that Act itself. Alternatively, Shri Sathe argued that assuming it was a licence having been created before 1st February 1973, the licenses also became a tenant by virtue of the provisions of section 15-A of the Bombay Rent Act. He then referred to Clauses 6 and 8 of the agreement to show that the provisions for sharing of expenses equally in case of some addition to the suit shop or of damages if possession was not given in time on yearly basis were foreign to the concept of licence.
He then referred to Clauses 6 and 8 of the agreement to show that the provisions for sharing of expenses equally in case of some addition to the suit shop or of damages if possession was not given in time on yearly basis were foreign to the concept of licence. As regards registration, it was his submission that being a family arrangement, no consideration was necessary and if no consideration was necessary, section 25(1) of the Contract Act would not apply. It was simply an agreement by way of family arrangement, by which the two brothers became entitled to carry on business alternatively and such a document certainly did not require registration. The question of registration would arise only when new rights are created. In the present case, the parties already held interest in the suit shop. That interest was crystallized in a particular manner in the form of the aforesaid agreement. Therefore, neither the question of registration under section 17 of the Registration Act nor the question of revocation of licence under section 60 of the Indian Easements Act would arise in this case. 5. I have carefully considered rival contentions in the light of the impugned judgment, the plaint, the written-statement, the affidavit in rejoinder dated 14th January 1977 and the agreement dated 23rd October 1972. Since Shri Sathe has not pressed the first three issues, the only issue that requires consideration is the fourth issue, namely, whether the agreement dated 23rd October, 1972 is enforceable in law. There is admittedly no dispute between the parties that such an agreement was entered into. For this purpose, it is desirable to refer to the agreement which reads thus :--- "THIS AGREEMENT made at Bombay this 23rd day of October 1972 between SAKHRAJ BACHAN Hindu inhabitant of Bombay hereinafter referred to as party of the First Part and Motilal Bachan Gupta, Hindu Inhabitant of Bombay hereinafter referred to as Party of the Other Part AND WHEREAS the party of the first part is the owner of the premises viz. Shop No. 38 situate at Tardeo Building of the Birla Industries Group Charity Trust, at 341.
Shop No. 38 situate at Tardeo Building of the Birla Industries Group Charity Trust, at 341. Tardeo Road, Bombay 34 AND WHEREAS the party of the first part is seized and possessed of the furniture, fixture fittings articles and things more particularly described in the Schedule hereunder written AND WHEREAS the party of the Other Part has requested the party of the first part to allow him to occupy the said premises of Shop No. 38 on contract basis to which the party of the first part has agreed to do so for a period of 12 months on the terms and conditions hereinafter mentioned NOW THIS INDENTURE WITNESSETH as under :--- 1. The period of this agreement shall be for a period of twelve months commencing from 1-10-1972 to 30-9-1973 (both days inclusive) as per the party of the other part is concerned. 2. It is agreed by and between the parties hereto that the party of the other part shall be in use and occupation for the purposes of conducting aforesaid premises i.e. Shop No. 38 from 1-10-1972 to 30-9-1973. 3. It is further agreed by both the parties hereto as under :-- From 1-10-1973 to 30-9-1974 party of the first part shall be in occupation of the said shop No. 38. Thereafter on and from 1-10-1974 the party of the other part shall apply to the party of the first part for allowing to use and occupy the said shop No. 38 every alternate year and the party of the first part shall agree to allow the use and occupy the said Shop No. 38 to the party of the other past as aforesaid. 4. It is agreed between the party of the first part and the party of the other part that each one of them will indemnify the other against any loss, damage, pilferage or destruction of all or any of them for any reason whatsoever. 5. It is agreed by and between the parties hereto that the party in occupation of the said shop No. 38 shall bear and pay all taxes, Municipal bills and such other charges as are liable to be paid by the party in occupation. 6.
5. It is agreed by and between the parties hereto that the party in occupation of the said shop No. 38 shall bear and pay all taxes, Municipal bills and such other charges as are liable to be paid by the party in occupation. 6. It is agreed by and between the parties hereto that any renovation or temporary alteration or charges that are proposed by either party shall be agreed mutually and the expenses if any shall be borne equally by both the parties hereto. 7. It is agreed by and between the parties hereto that either party will not act and damage or cause or suffer or to be damaged the said shop No. 38 or cause any act of waste therein or otherwise act in any manner in any way prejudicial to the party of the other part. 8. It is agreed by and between the parties hereto that in case of the either party over staying or not vacating the said shop and handing over the use and occupation of the said shop No. 38 the party failing to do shall pay to the party who is entitled to be in use and occupation the sum of Rs. 25/- (Rupees twenty five) only per day till the defaulting party hands over the use and occupation of the said shop No. 38 to the party entitled to be in occupation. IN WITNESS WHEREOF the parties hereto have hereunto set and subscribed their respective hands and seals the day and year first hereinbelow written." 6. Evidently the agreement does not indicate that business in the suit shop was ever carried on jointly by the defendant and the plaintiff or the same was a joint family business. The case made out is that the plaintiff had requested the defendant to allow him to occupy the said premises on contract basis, to which the defendant agreed. The terms and conditions are that they would carry on the business alternatively for a period of one year each and that for the period during which the shop is in their possession, they should bear all expenses in connection therewith such as taxes, Municipal bills rent, etc. In case of either party over staying or not vacating the said shop, there was a provisions for payment of Rs. 25/- per day for the period of default.
In case of either party over staying or not vacating the said shop, there was a provisions for payment of Rs. 25/- per day for the period of default. Under the circumstances, it is not possible to accept that this agreement is a family arrangement even though the fact that the defendant had agreed to allow the use of the suit shop to the plaintiff alternatively for a period of one year cannot be disputed in view of the averments in paragraph 13 of the written statement. Admittedly, the agreement does not provide for any consideration for the use of the suit shop in the above manner by the plaintiff. 7. Next question is what exactly is the nature of the agreement. It is true that in paragraph 13 of the written-statement, the defendant, has described this agreement as an arrangement. However, in my view, mere description of the agreement as an arrangement in the written-statement will not make the agreement as an agreement far less a family arrangement particularly when the existence of the family nucleus has not been established. Therefore, one has to proceed on the basis that this is an agreement between the defendant and the plaintiff without any consideration. Once the above conclusion is reached, the agreement, in my judgment, has either to fall within the description of licence or contract. If it is licence within the meaning of section 52 of the Easements Act, the defendant will obviously have a right to cancel the licence under section 60 of the said Act. On the other hand, if it is a contract without consideration, the contract will have to be held void for want of consideration. This is what section 25(1) of the Contract Act provides for. In the circumstances, whether such a document is compulsorily registrable or not under one or other clause of section 17 of the Registration Act is, to my mind, not of much consequence. The agreement, in the absence of registration, is a void agreement under section 25(1) of the Contract Act. Therefore, this agreement cannot be enforced in law. 8. The contention that the licence having been created before 1st February 1973, the plaintiff became a tenant under section 15-A of the Bombay Rent Act is also, in my view, not tenable.
The agreement, in the absence of registration, is a void agreement under section 25(1) of the Contract Act. Therefore, this agreement cannot be enforced in law. 8. The contention that the licence having been created before 1st February 1973, the plaintiff became a tenant under section 15-A of the Bombay Rent Act is also, in my view, not tenable. The licence contemplated under section 15-A is where the premises are given on a licence for a fixed period and not a licence for carrying on business alternatively for a year. This is peculiar kind of licence. Otherwise what would happen in such a case is that both the plaintiff and the defendant will become tenants. Such a situation could certainly have been not contemplated by the Legislature. 9. The Allahabad High Court in the case of Pokhar Singh v. Dulari Kunwar, A.I.R. 1930 Allahabad 687, no doubt, held that for a family arrangement to be good it is not necessary that there should be a family dispute which has to be settled or composed. A family arrangement to be good need not necessarily be a compromise of doubtful rights. Even avoiding chances of litigation in future is good consideration for family arrangement. However, this decision will not help the plaintiff as the conclusion of this Court is that this agreement was not and could not be a family arrangement. The Full Bench decision of Delhi High Court in the case of Chandulal v. Municipal Corporation of Delhi, A.I.R. 1978 Delhi 174, is not really applicable to the facts of the present case as in that case the distinction between a lease and licence was indicated. The Supreme Court decisions in (Waman Shriniwas v. R.B. Co.)4, A.I.R. 1959 Supreme Court 689, and M.N. Clubwala v. Fida Hussain Saheb, A.I.R. 1965 Supreme Court 689, on the other hand, support the case of the defendant. In the former decision it was held that section 15 of the Bombay Rent Act prohibited sub-letting and made it unlawful for a tenant to assign or to transfer his interest in the premises let to him. This would apply to contracts also as all contracts would fall under the provisions of law relating to contracts, i.e., the Contract Act.
In the former decision it was held that section 15 of the Bombay Rent Act prohibited sub-letting and made it unlawful for a tenant to assign or to transfer his interest in the premises let to him. This would apply to contracts also as all contracts would fall under the provisions of law relating to contracts, i.e., the Contract Act. In A.I.R. 1965 Supreme Court 610, the observations to the effect that in order to ascertain the relationship of the appellant with the respondent we must look at the agreement alone and that it was not open to look into extraneous matters are the observation which again support the defendant's case. 10. Having regard to the above discussion, the impugned judgment is upheld. The appeal is dismissed. No order as to costs. On oral application by Shri Sathe, stay of the order is granted for 12 weeks. Appeal dismissed. ------