Felicio D'Souza v. Damiao D'Costa — 1993 DIGILAW 474 (BOM)

JUDGMENT Dr. E.S. da Silva. J.-This second appeal is directed against the judgment of the learned District Judge, Panaji, dated 2nd September, 1988 which has affirmed the dismissal of the suit filed by the appellant by he learned Civil Judge, Junior Division, Mapusa in Civil Suit No. 77/79. The appellant has filed the said suit on 27.4.1979 for eviction of the respondent from the suit room and for mesne profits from 11.3.1979. 2. It was the case of the appellant that he had allowed the respondent to use the suit room for running a bar by mere tolerance d from the year 1968 on humanitarian grounds without accepting any compensation. The said structure was part of an old house existing in the appellant's property known as Tontem or Velichem Temba or Ventenchem Temba, situated at Gauravaddo of Calangute. The said house collapsed except for the suit room. In the year 1964 the appellant constructed the room after obtaining building licence from the Bardez Municipality. Thereupon in 1968, the respondent who had been evicted from the premises which he was occupying to run a taverna in the property of one salvador de Souza, approached the appellant and prayed that he should be allowed to carry on his business of taverna in the suit room. The appellant allowed the respondent to occupy the suit room because he has been earlier his plucker on compassionate grounds without payment of any rent or compensation. However, on 18.2.1979 the respondent without obtaining the appellant's permission decided to retile the roof of the suit room by replacing the old country tiles with Mangalore tiles and also cemented the front portion of the room. Therefore, the appellant served a notice on the respondent dated 28.2.1979 terminating the licence granted to him since he did not any longer desire to permit the respondent to occupy the said premises and directing him to vacate the room within seven days. As the respondent failed to comply with the terms of the notice, since 11.3.1979 he is in wrongful occupation of the room as a trespasser. The respondent is therefore, bound to pay to the appellant Rs. 50/- per month as he would have to pay as rent if he had occupied the room on lease. As the respondent failed to comply with the terms of the notice, since 11.3.1979 he is in wrongful occupation of the room as a trespasser. The respondent is therefore, bound to pay to the appellant Rs. 50/- per month as he would have to pay as rent if he had occupied the room on lease. He therefore, prayed that the respondent be evicted from the suit room with a direction to hand over its peaceful possession to the appellant with a further prayer that pending disposal of the suit he should be made to pay mesne profits to the appellant of Rs. 50/- per month. 3. The respondent resisted the suit claiming that he was a tenant of the premises. His case was that he had taken the suit room on rent from the year 1961 and that the initial rent was Rs. 3/- per month which subsequently was increased to Rs. 5/- per month and this was adjusted towards the drinks which the appellant used to have at the tavern which was running in the said premises. His further case is that it was the respondent who had been asked to leave the room which he was occupying in the property of Salvador de Souza and, asked the appellant's permission to reconstruct the suit room at his own cost and occupy the same for running his tavern, on payment of monthly rent of Rs. 3/- which the appellant agreed. Accordingly the respondent constructed all the walls of the room and put a complete new roof. For the first four years the rent was paid regularly to the appellant at the rate of Rs. 3/- per month and thereafter increased to Rs. 5/- per month and which rent was adjusted towards drinks which the appellant used to have at his tavern. 4. The appeal was admitted by this Court on the following substantial questions of law:- (a) Whether the Appellate Court was justified in holding that the Rent Act does not provide that a written agreement of lease is a must when Section 34 makes it incumbent to have the lease reduced to writing. 4. The appeal was admitted by this Court on the following substantial questions of law:- (a) Whether the Appellate Court was justified in holding that the Rent Act does not provide that a written agreement of lease is a must when Section 34 makes it incumbent to have the lease reduced to writing. (b) Whether Section 91 of the Indian Evidence Act, when any matter is required by law to be reduced to the form of a document and no evidence shall be given in terms of such contract, was it permissible for the Court to record a finding about the existence of a lease on the basis of oral evidence. (c) Whether the Appellate Court was justified in holding that as per the Rent Act, in view of Section 59(2), the Court cannot demand that lease agreement before the Act was enforced should be proved by written agreement. (d) Whether the Appellate Court was justified in taking recourse to Section 59(2) when no proceedings were pending at the time of the enforcement of the Rent Act. (e) Whether the Appellate Court was justified in taking into consideration matters not falling for determination of the issue for making payment of tax and effecting improvement. 5. Admittedly the suit was instituted by the appellant on 27.4.1979 and the Goa. Daman and Diu Buildings (Lease, Rent and Eviction) Control Act. 1968 (hereinafter called the Rent Act) was extended to Calangute wherein the suit premises are located on 23.12.1980. 6. Shri Kentak learned counsel for the appellant. has submitted that when the suit was filed in 1979 the Decree No. 4325 (hereinafter called the Decree) which was regulating the leases was very much in force and consequent upon the claim of the respondent in the suit instituted by the appellant against him as a licencee that he was the actual lessee in respect of the suit room, the said suit is to be deemed as having been filed under the provisions of the Decree. The learned counsel invited my/attention to Section 8 according to which its/sub-section (1) provides that a lease shall be necessarily executed in writing with the signature of both landlord and the lessee and if any one of them does not know to write or is not able to write their signatures would be done by third parties on their behalf in the presence of two witnesses who will sign the said agreement in the presence of the Notary public who would certify the genuineness of all the signatures. Sub-section (2) provides that the lease notwithstanding the absence of a written document would be held valid in Court through any other means of proof if it is possible to establish that the absence of a written instrument is due to the fault of the lessor or of the lessee. Sub-section (3) prescribes that when this fault is claimed by the lessee against the lessor the same would be admissible only if the lessee produces the d receipt of rent issued by the one who has the right to enjoy the property or its representative. It is thus seen that, according to the said provision of the Decree the lease has to be executed in writing and this is the requirement of the law. Further the lease which is not reduced in writing is admissible only when there is a fault of any of the parties in not executing a written instrument. Finally the right of the lessee to claim such fault on the part of the lessor is permissible only when he is able to produce the receipts of the rent issued by the landlord. It was urged by the appellant's leaned counsel that in the instant case the suit was filed by the appellant in 1979 on the ground that the respondent was a mere licencee and had been allowed to occupy the suit premises on compassionate grounds and on mere tolerance. The respondent however, denied that it was so and claimed that he was the lessee of the appellant. Admittedly no written lease had been executed between them. At the time of the institution of the suit and even when the respondent filed his written statement the Rent Act was not extended to calangute wherein the suit room is located. The Rent Act was applied to Calangute only in the year 1980. Admittedly no written lease had been executed between them. At the time of the institution of the suit and even when the respondent filed his written statement the Rent Act was not extended to calangute wherein the suit room is located. The Rent Act was applied to Calangute only in the year 1980. The respondent when he made a claim in the written statement that he was a lessee was not in a position to show that there was any lease agreement with the appellant in writing. Similarly the respondent had not even pleaded in the written statement that the absence of a written lease was due to the fault of the landlord. It was also not the respondent's case that he was in possession of any receipts issued by the landlord in respect of the suit room. The learned counsel has drawn my attention to the averments contained in the respondent's written statement namely in its para 4 wherein it has been stated that for the first four years the respondent has paid to the appellant Rs. 3/ - per month towards the rent of the suit room and thereafter rent was increased to Rs. 5/- per month which was being adjusted towards cost of the drinks which the appellant was consuming in his "taverna". It was then urged that when admittedly there is no plea in the written statement that the absence of a written agreement was due to the fault of the landlord it was not possible for the respondent to try to prove the existence of a lease through any other means. Therefore, the grievance of the learned counsel was that inspite of that the trial Court accepted the oral evidence of the respondent to establish that he was a lessee paying rents in respect of the suit room and illegally shifted on the appellant the burden of proving a negative fact i.e. the non-existence of a lease. Therefore, the grievance of the learned counsel was that inspite of that the trial Court accepted the oral evidence of the respondent to establish that he was a lessee paying rents in respect of the suit room and illegally shifted on the appellant the burden of proving a negative fact i.e. the non-existence of a lease. It was further contended that since the respondent was not able to produce receipts and in the absence of any specific averment that the failure in executing a written lease was due to the fault of the lessor the appellant as a landlord had nothing else to prove rather than to reiterate that the occupation of the respondent in respect of the suit room was of licence and by mere tolerance of the landlord which licence had been terminated by a competent notice which had not been complied by the respondent. The learned counsel therefore, submitted that in view of Section 8 of the Decree. which in the circumstances was deemed to be applicable in the absence of a written lease as well as of rent receipts and consequent upon the failure of the respondent to aver that the written lease was not executed due to the fault of the appellant issue No. 3 should have been straightaway answered in the negative and accordingly, a decree should have been made in the appellant's favour in the light of the aforesaid provision. 7. In order to appreciate the submissions of the learned counsel it is useful to examine the provision of Section 59 of the Rent Act which is both a repealing and a saving clause. Section 59 expressly provides in its sub-section (1) that as from the date on which the Act is brought into force in any local area, the provisions of Decree No. 43525... and the corresponding provisions of any other law for the time being in force shall stand repealed in that area. Sub-section (2) provides that, notwithstanding the repeal of the laws by sub-section (1), all suits and other proceedings under a repealed law pending at the commencement of this Act before any Court or authority shall be continued and disposed of in accordance with the provisions of the repealed law as if that law had continued in force and this Act had not been passed. First proviso to this section prescribes that in any such suit or proceeding for the fixation of fair rent or for the eviction of a tenant from any building, the Court or other authority shall have regard to the-provisions of this Act. It thus follows that even assuming that consequent upon the plea made by the respondent that he was a lessee the proceedings instituted by the appellant might have been deemed as being filed under the provisions of the Decree, the fact remains that by virtue of Section 59(1) of the Rent Act none of the provisions of the Decree could be invoked or availed of by the appellant. Indeed Section 59(1) clearly repeals from the date of its extension to a certain area the applicability of the provisions of the said Decree to the aforesaid area. On the other hand, since the appellant himself had admittedly filed the suit for eviction of the respondent on the ground that he was a mere licencee it is obvious that sub-section (2) of Section 59, cannot be said to be attracted because what was saved by the aforesaid sub-section (2) are the proceedings instituted under the Decree. In the instant case it is clear that the appellant has not filed any proceedings against the respondent for his eviction under the Decree but instead he has filed a civil suit against the respondent to recover possession of the suit premises on the ground that he was an encroacher consequent upon the termination of his licence. Hence, the question of applicability of Section 59(2) to the circumstances of the case does not seem to arise at all. 8. Shri Rebello, learned counsel for the respondent, in his turn has contended that from the frame of the appellant's plaint it is seen that he has filed the suit to get the respondent evicted on the basis that he is a licencee. In reply the respondent has contended that he was a tenant and thus could not be evicted. It was urged by the learned counsel that in view of the non-availability for the appellant of the provisions of the Decree. Namely, of its Section 8 the question of the respondent proving the existence of a tenancy should be answered in terms of the provisions of the Transfer of Property Act. Admittedly neither the Decree nor the Rent Act defines what is a lease. Namely, of its Section 8 the question of the respondent proving the existence of a tenancy should be answered in terms of the provisions of the Transfer of Property Act. Admittedly neither the Decree nor the Rent Act defines what is a lease. Section 2(p) of the Rent Act defines only what is a tenant which according to the said definition means any person by whom or on whose account or behalf the rent of any building is payable and includes also a sub-tenant and also any person continuing in possession after the termination of his tenancy. Section 2(j) of the Rent Act defines also landlord which means a person who is receiving or is entitled to receive, the rent of any building, whether on his own account or on account of, or on behalf of, or for the benefit of, any other person or as a trustee, guardian or receiver for any other person or who would so receive the rent or be entitled to receive the rent, if the premises were let to a tenant. These two definitions show that a tenant or lessee to be a tenant or lessee need not be party to a written agreement of lease and it is suffice for him to claim that there is evidence to show that he has paid rent to the landlord. It is true that Section 34 of the Act provides for a written lease agreement to be executed. However, it is nobody's case that the scope of Section 34 is the same as of Article 8 of the Decree. It is thus, not in dispute that the requirement of a written agreement is not a must in the scheme of the Act for the purpose of proving the existence of a lease. Shri Rebello then urged that the concept of lease can be found only in the Transfer of Property Act which has been extended to Goa a right from the year 1965. Under Section 105 of the said Act a lease has been defined as a transfer of a right to enjoy such property made for a certain time in consideration of a price paid or promised. Under Section 105 of the said Act a lease has been defined as a transfer of a right to enjoy such property made for a certain time in consideration of a price paid or promised. Section 106 provides that in the absence of a contract or local law or usage to the contrary, a lease of immovable property for agricultural or manufacturing purposes shall be deemed to be a lease from year to year, terminable, on the part of either lessor or lessee, by six months notice expiring with the end of a year of the, tenance, while a lease of immovable property for any other purpose shall be deemed to be a lease from month to month terminable on the part of either lessor or lessee, by fifteen days notice expiring with the end of a month of tenancy. Section 107 prescribes that 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. In other words a lease can exist even without being registered or reduced to writing and in such case the lease is to be deemed as operating on a month to month basis, which is automatically renewed for a similar period if not terminated by the lessor or lessee on giving 15 days notice for this purpose. 9. Shri Rebello has contended that in the facts and circumstances of the case the respondent has fulfilled all the requirements of the prevailing law as far as his relationship with the appellant is concerned in respect of the suit room coming therefore, within the purview of the definition of lessee in terms of the Transfer of Property Act. 10. There is considerable merit in the submissions of the learned counsel. The question which now arises is as to what would be the position of the respondent who claims to be a lessee of the appellant vis-a-vis the provisions of the Decree bearing in mind that during the pendency of the suit the Rent Act was extended to Calangute. 10. There is considerable merit in the submissions of the learned counsel. The question which now arises is as to what would be the position of the respondent who claims to be a lessee of the appellant vis-a-vis the provisions of the Decree bearing in mind that during the pendency of the suit the Rent Act was extended to Calangute. In this respect Shri Rebello has rightly answered that on 23.12.1980, the date of the extension of the Rent Act to Calangute, a saving clause was available in respect of eviction proceedings which were filed under the provisions of the Decree only and therefore, any deficiency regarding, compliance of the requirements of its Section 8 was to be deemed as removed consequent upon the coming into force of the Rent Act which in its Section 59(2) has protected eviction proceedings instituted only against tenants. Admittedly the proceedings filed by the appellant were neither under the provisions of the Decree nor against a tenant but instead against the respondent as a licencee. 11. Being so. there appears to be no bar for the respondent to plead a lease relationship with the appellant which is not in terms of Section 8 of the Decree irrespective of the fact that he was not able to claim the existence of a lease agreement in writing or to produce any receipts with regard to the payment of rents to the appellant. The respondent was therefore, free to prove the existence of such lease merely on the basis of oral evidence as permissible, under the scheme of the Rent Act notwithstanding the fact that its Section 34 expressly provides for a lease deed to be executed between the landlord and the tenant when a building is let out after the Act came into force. In this respect both the Courts below have given concurrent findings about the existence of a lease relationship between the appellant and the respondent with regard to the suit room and the appellant at no time has assailed such finding recorded by both the learned trial Judge as well as by the First Appellate Court. 12. Shri Rebello appears to be also justified when he makes a grievance against the impugned judgment of the learned District Judge to the extent that it concedes the availability of sub- section (2) of Section 59 of the Rent Act in this case. 12. Shri Rebello appears to be also justified when he makes a grievance against the impugned judgment of the learned District Judge to the extent that it concedes the availability of sub- section (2) of Section 59 of the Rent Act in this case. It is his contention that the aforesaid provision being not at all attracted the approach of the learned District Judge should have been that consequent upon the extension of the Rent Act any disability which could eventually hit the respondent in view of Article 8 of the Decree was to be held as having disappeared and hence. there was no necessity for the respondent claiming to be a lessee to prove in the absence of a lease deed the actual existence of such lease solely on the strength of rent receipts. 13. This being the position and once it is to be held that the respondent was a lessee of the appellant within the meaning of Section 105 of the Transfer of Property Act it is obvious that his eviction sought for by the appellant could be effected only in terms of the provisions of the Rent Act. Further Section 34 of the Rent Act would also not be applicable in the case so as to the necessity of a written document as a proof of the existence of the lease because the said lease was purportedly executed between the appellant and the respondent much prior to the coming into force of the Rent Act. 14. It thus, follows that notwithstanding the operation of the Rent Act non-compliance of the mandate of its Section 34 and the consequent absence of a lease deed does not necessarily lead to the invalidity of such lease as the relationship between the concerned a parties can be proved by any other type of evidence available even if there is no written document executed between them for the purpose of creation of the lease. 15. 15. In the case of Shankerlal Gupta v. Jagadishwar Rao, AIR 1980 AP 181, while dealing with the provisions of Hyderabad Houses (Rent, Eviction and Lease) Control Act (20 of 1954) and Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act (15 of 1960) it has been held that an agreement of lease entered into by the landlord with the tenant in contravention of Section 3(3) of any of b these Acts would not be illegal and void inter se by law or on the ground that it is opposed to public policy in terms of Section 23 of the Contract Act. The Court further observed that the agreement of lease is perfectly valid and binding inter se between the parties i.e. landlord and tenant, but as against the Rent Controller, it is a void agreement. It is thus, obvious that in the circumstances, the eviction of the respondent could be secured by the appellant only by filing appropriate proceedings under the relevant provisions of the Rent Act. 16. On the other hand, it is impermissible for Shri Kantak to counted that once the respondent claimed to be a lessee this would necessarily mean that he was invoking the provisions of the Decree and therefore, the proceedings instituted by the appellant for the respondent's eviction are to be held as proceedings under the said Decree. Hence, Section 59(2) was to be brought into picture as a result whereof the proceedings are deemed to be saved. I am also unable to agree with the learned counsel that Section 8 of the Decree is not providing for a mode to prove the existence of a lease in case of absence of a written agreement to this effect and that it only imposes a bar upon the parties to plead tenancy in the aforesaid circumstances. Thus, the fact of the respondent claiming to be a lessee and thus, bound to prove it does not mean that he could plead it only in terms of Section 8 of the Decree. 17. The respondent has adduced before the trial Court cogent and material evidence which has been accepted by the Courts below to prove that he was unmistakably a lessee of the appellant in respect of the suit room and that he was occupying the same against the payment of rents to him. 17. The respondent has adduced before the trial Court cogent and material evidence which has been accepted by the Courts below to prove that he was unmistakably a lessee of the appellant in respect of the suit room and that he was occupying the same against the payment of rents to him. This finding which seems to be based on evidence does not require to be unsettled and on the contrary the same is bound to be adopted bearing in mind that in view of the provisions of the Transfer of Property Act the respondent can be regarded as a lessee of the suit room. 18. Shri Rebello has rightly urged that a defence plea advanced by the respondent in his written statement is not by itself sufficient to render the entire proceedings instituted by the appellant as proceedings under the repealed law and that what is saved by Section 59(2) is just the cause of action considered as a bundle of facts relied by the appellant while seeking relief against the respondent. The c proceedings filed against the respondent cannot therefore, be said to be proceedings under the provisions of the Decree. In this view of the matter all the substantial questions of law raised by the appellant in the appeal are answered accordingly. 19. The result is that I see no merit in this appeal which is hereby dismissed with costs. Appeal dismissed.