K. Ranganatham Chetty vs Koppulu Kanakaratnammah and Others

Frederick William Gentle, C.J.—The suit out of which this appeal arises was for specific performance of an agreement, dated the 12th

August, 1943, to grant a lease of premises No. 1/90, Godown Street, Madras, for a period of 26 months at a monthly rental of Rs. 85. There was

also a claim for damages which were alleged to amount to Rs. 10,000. The learned Judge dismissed the suit, and this is the plaintiff''s appeal

against the learned Judge''s decision.

It is necessary to refer to a few facts, although our task has been greatly lightened by Mr. Narasimha Aiyar, learned Counsel for the appellant,

who has quite properly drawn our attention to the relevant provisions of law and has greatly shortened the time of disposal of this appeal.

The first defendant is the owner of the premises. By exchange of letters between them, each dated the 12th August, 1943, the first defendant

agreed to lease to the plaintiff the premises in suit for a period of 26 months as soon as the second defendant, who was then the occupier, vacated

the premises and handed over the keys. The plaintiff paid Rs. 500 as an advance towards the rent. A week later, the first defendant purported to

give the second defendant one month''s notice to terminate what was alleged to be a monthly tenancy of the premises. The reply, written on behalf

of the second defendant to the notice to quit, asserted that the premises were occupied under a lease for three years, commencing in February,

1942, and not expiring until February, 1945, about 18 months thence forward. In December, the first and second defendants apparently got

together and made an agreement, the terms of which are set out in a letter, dated the 15th December, 1943, written by the second defendant to the

first defendant. That letter states that the second defendant was a tenant of the premises in suit for a period of eleven months at a rental of Rs. 80

monthly, terminating on the 15th November, 1944. There was a term that the second defendant should not sub-let the premises. About April,

1944, the second defendant sold his business to the third defendant and let him into occupation. A meeting took place, according to the

correspondence, about that time, by which the rent of the premises pursuant to the agreement set out in the letter of the 15th December, 1943,

was paid by the third defendant up to the termination of that agreement and was accepted by the first defendant. One matter requires reference;

these premises were subject to the Control Orders which were in force, and prevented any landlord recovering possession, save upon the terms

set out in the Control Orders, which meant that as long as a tenant complied with the ordinary terms of his tenancy he could not be disturbed from

occupation, however much the landlord might desire possession.

It is in those circumstances that the plaintiff instituted the suit, out of which this appeal arises, on the 14th December, 1945, and added the

second and third defendants as parties, alleging, in effect, that all the defendants were conspiring together to prevent the plaintiff from obtaining

possession.

In dismissing the suit, the learned Judge gave several grounds, which in his opinion disentitled the plaintiff from succeeding. It is necessary only to

refer to one of them, since Mr. Narasimha Aiyar has frankly conceded that if he is unable to disturb the learned Judge''s findings with regard to that

matter, no purpose is served by an investigation and discussion upon the other aspects of the case, inasmuch as the appeal must fail.

It arises in this way. The agreement under which the plaintiff seeks to enforce a right to specific performance is a contract for the grant of a lease

for a period of 26 months, and the plaintiff has never been in occupation of the premises at all. It is beyond doubt that that agreement requires

registration pursuant to the provisions of the Registration Act. If, as in this case, the agreement is not registered, it is inadmissible in evidence and

cannot be enforced. An exception to this in-admissibility in evidence is provided by Section 27-A, Specific Relief Act, which enacts as follows:

Subject to the provisions of this Chapter, where a contract to lease Immovable property is made in writing signed by the parties thereto or on their

behalf, either party may, notwithstanding that the contract, though required to be registered, has not been registered, sue the other for specific

performance of the contract, if,

(b) where specific performance is claimed by the lessee, he has, in part performance of the contract, taken possession of the property, or, being

already in possession, continues in possession in part performance of the contract, and has done some act in furtherance of the contract.

It is to be observed that an unregistered contract to lease property, which is required to be registered, can be admitted in evidence in very limited

circumstances. So far as material, the potential lessee must be in occupation, either having taken occupation pursuant to the agreement or remained

in occupation thereof, and, in addition, has done some act in furtherance of the agreement. Unless those circumstances exist, the agreement is one

which cannot be admitted in evidence. Since those circumstances do not exist in the present case, it must follow that the agreement, which is the

subject of the present suit, the one made between the parties on the 12th August, 1943, cannot be admitted, and it necessarily follows there cannot

be, whatever other merits there may be, an order for specific performance in respect of it. It follows that the plaintiff cannot enforce his contract

with the first defendant, is not entitled to an order for specific performance, and that the learned Judge''s decision in that respect is correct, and this

appeal must fail.

It was argued strenuously that, as regards costs, only one set should be awarded against the plaintiff. The learned trial Judge pointed out that it

was essential and quite proper that the three parties should be separately represented, as their interests were not the same and, to some extent,

they were in conflict. The three respondents, the first, second and third defendants in the suit have been brought here by the plaintiff. After giving

every consideration to the arguments addressed on behalf of the plaintiff-appellant, it seems to me that, having brought the respondents here and

having failed in the appeal, the only proper order is to direct that the appellant should respectively pay each of the respondent''s costs.

Rajamannar, J.

I agree entirely.