Venkatachalapathy Odayar vs Rajalakshmi Ammal

G. Ramanujam, J.—The defendant in O.S. No. 380 of 1973 on the file of the District Munsif of Valangiman at Kumbakonam is the

appellant in this second appeal.

The said suit was filed by the respondent herein for recovery of possession of the suit properties on the ground that the defendants took on lease

the right to collect the usufructs from 135 coconut trees for the period 1st April, 1969 to 31st March, 1970 for a sum of Rs. 600 and that after the

expiry of the said period, the defendant has not surrendered possession of the coconut tope even after the issue of a notice dated 21st February,

1973 calling upon the defendant to deliver possession of the thope.

The suit was resisted by the defendant contending that an extent of 2.97 acres was taken on lease by the defendant, that the said leasehold

extent originally contained 56 coconut trees, that after taking the land on lease, he had planted 100 coconut saplings at his cost and expense and

reared and nurtured them, that he also raised casuarina plantations in the remaining land where there are no coconut trees, that it is not correct to

say that the defendant took merely the right to collect the usufructs from the coconut trees without any right in the land, that the defendant being a

tenant in respect of 2.97 acres of land and not a mere licensee of the coconut tope, he is entitled to the benefits of the Cultivating Tenants

Protection Act and that in any event, the tenancy in his favour has not been duly terminated as provided in Section 106 of the Transfer of Property

Act, herein after referred to as the Act.

On the above pleadings, the trial Court held that the defendant is not a cultivating tenant of the suit land, but that his lease has not been properly

terminated and, therefore, the suit for possession cannot be maintained. In this view, the suit was dismissed. On appeal, the lower appellate Court

held that as Section 106 of the Act will not apply to agricultural leases in view of Section 117 of the Act, the plaintiff is entitled to seek possession

even though a proper notice had not been issued in this case terminating the lease u/s 106 of the Act. In this view, the trial Court''s decree and

judgment were reversed and the plaintiff was granted a decree for possession with future mense profits from the date of plaint till the date of

delivery of possession.

In this second appeal, the defendant seeks to challenge the finding given by the lower appellate Court that as the lease is one for agricultural

purposes. Section 106 of the Act will not apply contending that the suit for recovery of possession of a leasehold property is not maintainable

unless there is a prior notice terminating the lease as provided in Section 106 of the Act.

After going through the actual evidence in the case, I am of the view that both the Courts below have missed the real question that arises in this

case. The trial Court as well as the lower appellate Court have proceeded on the basis that what was granted by the plaintiff to the defendant was

a lease of land. However the facts as established, indicate that the lease in favour of the defendant was only a right to collect the usufructs from the

coconut trees for a period of one year. As a matter of fact when the defendant filed an application before the Record Officer for recording his

name as a cultivating tenant, that application was rejected on the ground that what was granted to the defendant was a right to collect the usufructs

and there was no lease of the land, and therefore, he cannot be taken to be a tenant entitled to the benefit of the Tenancy Rights Act. The said

order of the Record Officer has been marked as Exhibit A-1. The same was confirmed by the Sub-Collector, Kumbakonam, on appeal and his-

order has been marked as Exhibit A-2. The said order was again confirmed in a revision by the District Revenue Officer,, Thanjavur, whose order

has been marked as Exhibit A-6. Apart from these decisions rendered by the authorities constituted under the Tenancy Rights Act the documents

under which similar right granted earlier had been marked as Exhibits A-7 and A-8. These documents indicate that the defendant was given the

right to collect the usufructs from. 133 coconut trees situate in 2 acres 97 cents for a period of one year and that after the said period, the trees will

be handed over to the plaintiff. The said documents do not confer on the defendant any right in the land. The answer to the question whether there

was a lease of the land or a licence to collect the usufructs from the coconut trees standing on the land has to be gathered from Exhibits A-7 and

A-8 which are admittedly the prior documents evidencing earlier similar transactions between the plaintiff and the defendant.. Therefore, the Courts

below should have first gone into the question as to what was granted to the defendant was a lease or a licence and only when it is found that it is a

lease,, the question of applicability of Section 106 of the Act should have been gone into. Without going into the nature of the transaction, they

have assumed that the transaction is a lease and proceeded to decide the question of applicability of Section 106 of the Act. I am of the view that

on the facts of the present case, the basic question that has to be decided is, whether the transaction between the plaintiff and the defendant is a

lease, as contended by the defendant or a. licence, as contended by the plaintiff.

To decide whether a particular transaction is one of licence or lease, Courts have applied various tests. If a right is created in respect of a land

for a specified time and the grantee is expected to exploit the land for purposes of his own, then the transaction can be said to be one of lease. But,

where without creating any interest in the land the right to collect the usufructs from the trees standing on the land alone is given, the grantee cannot

claim to be a lessee, he can be said to be a licensee only. In determining whether a particular transaction is a lease or a licence, we have to be

guided by the substance of the deed evidencing the transaction and the intention of the parties.

In Panchapakesan v. Swaminathan (1971) 1 MLJ 169, this Court has pointed out the distinction between a lease and a licence. It was pointed

out in that case that the distinction between a lease and a licence is well-established, that if there is a document, the substance of the document

must be preferred to the form, that the real test is the intention of the parties whether they intended to create a lease or a licence, that if the

document creates an interest in the property, it is a lease, but if it only permits another to make use of the property, of which the legal possession

continues with the owner, it is a licence. The distinction between a lease and licence had been pointed out by the Supreme Court in Associated

Hotels of India Ltd. Vs. R.N. Kapoor, . In the said decision, it was pointed out that the real test is the intention of the parties and that if the

document creates an interest in the property, it is a lease, but if it merely permits another to make use of the property, it is a licence. In Mrs. M.N.

Clubwala and Another Vs. Fida Hussain Saheb and Others, , the Supreme Court again pointed out that the intention of the parties is the decisive

consideration for finding out whether the agreement between the parties created a relationship of landlord and tenant or merely that of licensor and

''licensee, that the intention of the parties has to be ascertained on a consideration of all the relevant provisions in the document and that in the

absence of a formal document, the intention must be inferred from the circumstances and conduct of the parties.

Applying the principles laid down in those cases for determining whether a particular transaction is a licence or a lease, to the facts of the present

case. I am of the view that the transaction between the plaintiff and the defendant can only be treated as a licence. If it is considered as a licence,

there is ho question of termination of the tenancy as required u/s 106 of the Act, and a mere revocation of the licence is sufficient, which has been

done in this case under Exhibit A-3.

In this case, the defendant has been specifically given the right to collect the usufructs from the 135 coconut trees situate on the land. The case

of the defendant is not that any right to cultivate the land as such had been given to him. As a matter of fact, the earlier documents, Exhibits A-7

and A-8 evidencing similar transactions do not create any interest in the land in favour of the defendant and the only right granted to him was to

collect the usufructs from the coconut trees for a period of one year. Having regard to the fact that the defendant has not been granted any interest

in the land and has not been authorised to put the land to any particular use, the transaction between the plaintiff and the defendant can only be

taken as a licence. It also does not appear that an exclusive possession of the land has been given to the defendant, though the defendant has been

asked to attend to the watering of the coconut trees and also to attend to the fencing of the land. It is only for the purpose of protecting his own

interest and to secure the usufructs from the coconut trees to him. As I am of the view that the transaction between the plaintiff and the defendant is

a licence, there is no question of issuing a notice of termination as contemplated in Section 106 of the Act. In this view of the matter, the decree of

the lower appellate Court directing delivery of possession, has to be confirmed, but on a different ground.

The second appeal, therefore, fails and it is dismissed. No costs.