Holding

A licencee remains a licencee even after purchasing the property from the original owner; the licence does not merge with the lease, and the licensor is entitled to a mandatory injunction to recover possession.

Summary

Sant Lal, a lessee of a plot of land under a ten‑year lease, granted Avtar Singh a one‑year licence to use a shed for a workshop. After the licence expired, Sant Lal terminated it and sued for a mandatory injunction to vacate the shed. Avtar Singh contended that he had purchased the entire property from the original owner in 1979 and therefore could not be evicted. The trial court dismissed the suit, the Additional District Judge reversed, and the Punjab & Haryana High Court restored the dismissal on the ground of merger of the lease with the sale. The Supreme Court held that the sale did not merge the lease, that the respondent remained a licencee obliged to surrender possession, and that a suit for mandatory injunction is effectively a suit for possession and is maintainable despite any delay. Consequently, the appeal was allowed and the respondent was ordered to deliver possession to the appellant.

Issues considered

Whether a licencee who later purchases the property from the original owner merges the lease and loses the licensor's right to evict.
Whether a suit for mandatory injunction is maintainable in place of a suit for possession when filed after the licence has been revoked.
Whether delay in filing the injunction suit defeats the licensor's claim for relief.
Whether the provisions of the East Punjab Rent Restriction Act, 1949, bar eviction of a tenant of vacant land except as prescribed.

Legislation cited

Court Fees Acts. 7(v)
East Punjab Rent Restriction Act, 1949s. 13
Indian Evidence Act, 1872s. 116
Specific Relief Acts. 55

Subjects

licenceleasemandatory injunctionpossessionEast Punjab Rent Restriction Actmerger of leasedelayproperty lawsale deedspecific relief

Judgment

SANT LAL iAtN
v

AVTAR SINGH
B
March 12, 1985

[S. MURTAZA FAZAL ALI, AND A. V ARADARAJAN, JJ.] \
East Punjab Rent Restriction Act 1949: Section I 3, Grant of licence for
C one year-On eXpiry of period licence revoked-Suit for nzandatory injunction
filed-Delay infilian of-Whether excusable-Such Suit in effect one for posses-
sion-Suit should be decreed-On terminatio1 of licence-Licencee's possession
that of a Ires-passer.

Indian Evidence Act, Section 16.

D Licensee purchased property duri'ng pendency of suit-Jr could set up title
to proper1y-evictlonfro1n property-Whether per1nissble.

The appellant had taken a plot of land on lease under a lease-d~cd for
a term of 10 years for M/s Jain Motors. · At that time he was only a partner
of M/s Jain Moters but later he became its sole owner. The respondent took
from the appellant on licence for one year undt:r a deed the suitshed for carry-
E ing on wOrk shop business Since he did not vacate the she dafter the expiry of
the period the appellant treminated the licence and filed the suit for a manda-
tory injunction directing the respondent to vacate the premises. The respon-
dentopposed the suit contending that the appellant sub.Jet to him a plot of land
and he had raised a new construction thereon and is carrying on work!ihop
business, and that the relationship between the parties was that of landlord
and tenant and the suit for mandatory injurict!on was not maintainabl~.
F
The trial court dismissed the suit, for mandatory injunction as not
maintainale.

On appeal, the Additional District Judg.;: held that the relationship
G between the parties was only on.: of licensor anJ lic;!n'>oe and that suit for
mandatory injunction was maintainabl~. allowed the appeal decreed the suit
and directed the respondent to deliver vacant posse~sion of the shed.

In the second appeal, the respondent filed an application for receiving as
additional evidence a sale-deed dated 27.8.1979 whereby he claimed to have
purchased the entire property from its orignial owner. On a finding called for
H
SANT tAt v. AVTAR siNGH is~

by the High Court, the trial court found 'that the re•pondent had purchased the A
property from its original owner by that sale-deed. The High Court held
that after the commencement of the tenancy or the licence a tenant or licensee
who has" pu1chased the property from its original owner cannot be evicted
from that property on the basis of the lease·or licence. The Second appeal
was allowed, the judgment and decree of the additional District Judge Was set
aside and the trial court's decree dismissing the suit was restored.
B
Allowing the Appeal,

HELD: 1. There is no m~rger -of the whole property py it original
I
owner in favour of the appellant by reason of thl! sale of the entire property by
7 the original owner in favour of the respondent or of the licence given by the
appe1Iant to the respondent which had been revoked prior to the date of the
suit. The lease in favour ofthe·.i.ppellant continues and under the,Past Punjab c
Rent Restrictions Act 1949 even the t'nan t of a vacant land cannot be evicted
therefrom except in accordance with the provisions of that Act. l188F-G]

K.K. Verma & Anr. v. Union of India & Anr., AIR 1954 Bombay 358,
Milka Singh v. Diana & Ors., AIR 1964 Jammu & Kashmir 99, relied upon.

2. In the instant case, it has not been shown that the appeilant had
filed the suit for m1njatory injunctio11 after considerable delay which will D
disentitle him to the discretionary relief. Even if there was some delay, in a
ca"c of this kind attempt should be made to avoid multiplicity of suits and the
licensor should not be driven to file another suit with all the attendant delay,
trouble and expen':ie. [l89E-FJ

3. The suit is in effect one for possession though couched in the form
of a suit for mandatory injunction as what would b:; given to the plaintiff in
case he succeeds in possession of the property to which he may found to be
E
entitled. Therefore, the appe11ant should not be denied relief merely because
he had couched the plaint in the form ofa suit for mandatory injunction.
• - [!89G]

4. The respondent was a licensee and he must be deemed to be always
a licensee. It is not op~n to him; duril1g th.:: subsistl!nc.:: of the licence or in the
F
licence or in the suit for recovery of possession of the property instituted after
revocation of the licence to set up title to the property in himself or anyon~
else. It is his plain duty to surrender possession of the property as a licensee
and seek his remedy separately in case he has acquired title to the property
subsequently through some other person .. He need not do so if he has acquired
title to the property from the licensor or from some one else lawfully claiming
under him, in which case there would be dear merger. The respondent had G
not surrendered the possession of the property to the appeallant even after the.
termination of the licenc;e and the institution of the suit. The appellant is,
therefore, entitled to recover possession of the property. The respondent is
directed to deliver possession of the property to the appellant forthwith failing
which it will be open to the appellant to execute the decree and obtain
possession. (189H; 190A-CJ H
186 SUPREME COURT REI'ciilTS (1985) 3 S.C.R.
A CivIL APPELLATE JURISDICTION: Civil Appeal No. 216 of 1984

From the Judgment and Order dated l l.9.80 of the High Court
of Puniab & Haryana at Chandigarh in R.S.A. No. 126/76.

B Harbaiis Lal A.K. Goel for the Appellant.

A.K. Gaugu/i and A.D. Sikri for the Respondent.

The Judgment of the Court was delivered by
c VRADARAJAN, J. This appeal by special leave is by the plain-
tiff against \he reversing judgment of the Punjab and Haryana High
Court in R.S.A. No. 126 of 1979. The trial court had dismissed the
\
suit but the learned Additional District Judge, Patiala allowed the•
plaintiff's appeal and decreed the suit.
D
The plaintiff/appellant's case was that he had taken on lease
under a lease-deed dated 26.8.1963 for a term of 10 years a plot
of land measuring 51' x 118; situate near the Army Headquarters,
Lower Mall, Patiala for M/s Jain Motor from it• owner Lt. Col.
Sadan Singh. He was 011ly a partner of M/s Jain Motors in 1963,
E but later became its sole owner in 1967. The defendant/respondent
took from the appellant on licence for one year under a deed dated
10.12.1969 the suit shed for carrying on the work of repair of
motors, tractors, etc. But since he did not vacate the shed after
the expiry of the period he terminated the licence and filed the suit
on 15.2.1973 for a mandory inju11ction directing him to vacate the
F premises. The respondent opposed the suit contending that the
appellant sub-let to him a plot of land in 1966-67 and be has raised
a new construction thereon and is carrying on workshop business
therein since then. He further contended that the relationship
between the· parties was that of landlord and tenant and that the
suit for mandatory injunction was not maintainable.
G The trial court found that M/s Jain Motors were the lessees
and that the respondent become a sub-tenant of a piece of land and
constructed the suit shed thereon and that the suit for mandory
injunction is not maintainable and dismissed the suit. In the
appeal the learned Additional District Judge set aside the trial court's
. findings recorded in favour of the respondent and found that no
H rent is mentioned either in the document executed by the respon-
SANT LAL v. AVTAR SINGH (Varadarafan, j.) 1~7
dent in favour of the appellant or in the written statment and no A
rent receipt was produced by the respondent, and that the relation-
ship between the parries was only one of licensor and licenesee.
On the question of delay in filing the suit the learned Additional
District Judge found that the partie remained busy in fighting out
criminal cases till the end and that the present suit bad been ·filed B
ibereafter and there bad been no undue delay and also that there
was no challenge to the trial court's finding that the respondent
had not put any construction of his own and held that the suit for
mandatory injuuction against the !icenesee is maintainable. On these
) findings he allowed the appeal and decreed t4e suit, directing the c
respondent to deliver vacant possession of the shed in dispute
to the appellant.

In the second appeal the rspondent filed an application for
receiving as additional evidence a saJe.·deed dated 27.8.1979
whereby he claimed to have purchased the entire property from
D
its original owner. The High Court called for finding in that regard
from the trial court which thereupon found that the respondent
has purchased the property from its original owner by that sale
deed. It was contended in the High Court that in view of that sales,
it is not open to the appellant to contend that the respondent in
whom the title to the property has come to be vested after the date E
of the suit, is liable to be ejected on the revocation of the license
granted to him by the appellant. On the other hand, it was conten-
. ded for the appellant that the fact that the respondent had purcha-
sed the property from its owner subsequent to the grant of the
licence in favour of the respondent does not make ony difference
to the appellant's claim for recovering possession of the suit shed F
and that it is obligatory on the respondent to first surrender
possession of the property after the licence had been revoked ·and
then seek his remedy, accoding to law, on the basis of the title clai-
med by him. It was further contended that in view of the provisions
ofs. 13 of the East Punjab Rent Restrictions Act, 1949, the appellant
who was the tenant of the property under its original owner cannot
G
be dispossessed except in accordance with the provisions of that
Act.
The learned Single Judge of the High Court rejected the
appellant's contention that bis rights under the lease by the
original owner cannot be interfered with the provisions of
the said Act, observing that from the decisions referred to by him H
18~ SlJPRllME COURt REPORTS (1985] 3 s.c.Ii.

A and the provisions of s, 116 of the Indian Evidence Act, it is
clear that after the commencement of the tanancy or the licence a
tenant or licensee who has purchased the property from its original
owner cannot be evicted from that property on the lease or licence.
He rejected the contention that the present suit for a mandatory
B injunction directing the respondent to vacate and hand over posses-
sion of the suit shed is in effect a snit for possession and he allowed
the second appeal and set aside the judgment and decree of the
learned Additional District Judge and restored the trial court's \
decree dismissing the suit.
\
c Now the parties are bound by the following factual fiindings
recorded by the learned Additional District Judge in the first appeal
namely: (I) that the appellant who had become the sole proprietor
of M/s Jain Motors in 1967 through at the time of the lease of the
property by the original owner Lt. Col. Sadan Singh to M/s Jain
Motors in 1963 he was only one of its partners, was the lessee of
D the property; (2) that the respondent had become a licensee of the
suit shed under the appellant when the appellant was in possetsion
of the whole of the demised permises including the suit shed as
tenant under the original owner; (3) that the licence in favour of
the respondent hae been revoked before the institution of the
present suit and (4) that subsequent to the decision in the first
.E appeal on 7.12.1978, the respondent had purchased the entire
property from the original owner by a sale-deed dated 27.8.1979.
Jn these circumstances, there is no merger of the lease of the whole
property by its original owner in favour of the appellant by reason
of the sale of the entire property by the original owner in favour
of the the respondent or of the licence given by the appellant to
F the respondent which had been revoked prior to the date of the
suit. The lease in favour of the appellant continues, and it is not
disputed that under the Act of 1949 referred to above, even the
tenant of a vacant land in Patiala town cannot be evicted therefrom
except in accordance with the provisions of that Act. In K.K.
Verma & Anr. v. Union of lndia & Anr.,< 1> Chagla, C.J. presiding
G over a Division Bench has .observed that in India a landlord can
only eject his erstwhile tenant by recou.se to law and by obtaining
a decree for ejectment. Jn Milkha Singh v. Dvna & Ors. ,(2) it has

(!) AIR 1954 Bombay 358
H (2) AIR 1964 Jammu & Kashmir 99,
SANT LAL v. AVTAR SINGH (Varadarajan, J.) 189

been observed that the principle once a licensee always a licensee A
would apply to all kinds of licences and that it cannot be said that
the moment the licence it terminated, the licensee's possession
becomes that of a trespasser. In that case, one of us (Murtaza
Fazal Ali, J.) as he then was speaking for the Division Bench has
observed:
B
"After the termination of licence, the licensee is under
clear obligation to surrender his possession to the owner
and if he fails to do so, we do not see any reson why the
licensee cannot be compelled to discharge this obligation
by way of a mandatory injuction under s. 55 of the Speci- c
fic Relief Act. We might further mention that even under
English law a 'suit for injunction to evict a licensee has
always been held to be maintainable.

Where a licensor approaches the court for an injunc-
tion within a resonable time after the licence is terminated, D
be is entitled to the injunction. On the other hand, if the
licensor causes huge delay the court may refuse the discre-
tion to grant an injunction on the ground that the licensor
had not been diligent and is that case 'the licensor will have
to bring a suit for possession which will be governed by
s.7 (v) of the Court Fees Act." E

In the present case it has not been shown to us that the
appellant had come to the court with the suit for mandatory injunc-
Uon after any considerable delay which will disentitle him to the
discretionary relief. Even if there was some delay, we think that
in a case of this kind attempt should be made to avoid multiplicity F
of suits and the licensor should not be driven to file another round
of suit with all the attendant delay, trouble and expense. The suit
is in effect one for possession though couched in the form of a suit
for mandtory injunction as what would be given to the plaintiff
in case he succeeds is possession of the property to which he may be
found to be entitled. Therefore, we are of the opinion that the G
appellant should not be denied relief merely becaue he had couched
the plaint in the the form of a suit for mandatory injunction.

The respondent was a licensee, and he. must be deemed to be
always a licensee. .It is not open to J1im, during the subsistence of H
190 SUPREME COURT REPORTS (1985] 3 S.C.R.

A the licence or in the suit for recovery of possession of the property
instituted after the revocation of the licence to set up title to
the property in himself or anyone else. It is his plain duty to surren-
der possession of the property as a licensee and seek his remedy
separately in case he has acquired title to property subsequently
through some other person. He need not do so if he has acquired
B title to the property from the licensor or from some one else law-
fully claiming under him, in which case there would be clear
merger. The respondent has not surrendered possession of property
to the appellant even after the termination of the licence and the
institution of the suit. The appellant is, therefore, entitled to recover 1
possession of the property. We accordingly allow the appeal with "
C costs throughout and direct the respondent to deliver possession
of the property to the appellant forthwith" failing which it will
be open to the appellant to execute the decree and obtain
possession.

A.P.J. · Appeal allowed.

1