Decided on November 13,1973

Ratha Behera Appellant
Rama Ratan Goenka Respondents


S.K. Ray, J. - (1.) Plaintiff No. 1 and one Sayeed Nazar Ali filed the suit out of which this second appeal arises for a declaration that they are the permanent lessees in respect of the suit tank and for issue of an injunction restraining the defendants not to lease out the tank to anybody else except the plaintiffs and for issue of a direction to the defendants to receive payment of Rs. 800/-for the year 1970-71 and to lease out the tank to them and for other ancillary reliefs. Sayeed Nazar Ali, who was originally plain,i No. 2 in the suit, having died, his heirs have been substituted. The suit having been dismissed by both the Courts below, the present appeal has been preferred by the aforesaid plaintiffs.
(2.) There is a tank which is in suit. This tank admittedly belongs to the defendants. They used to grant a right to the original plaintiffs to rear fish in the tank and appropriate the same annually. This annual transaction between the defendants and the original plaintiffs was being regulated by written contracts. The last such contract before suit was one executed on 7-6-1969 for the year 1969-70. This year was to expire on 7-6-1970. Knowing that the defendants were' unwilling to renew the contract for the subsequent year, they filed the suit for-the aforesaid reliefs basing their claim on the foundation of their previous transactions with the defendants as being transactions of lease. Their suit was resisted by the defendants on the ground that they were mere licensees from year to year. The last deed of contract dated 7-6-1969 was nothing but a licence deed. Since licences are revocable on the expiry of the term of the licence, the plaintiffs are not entitled to any renewal of the same.
(3.) One of the essential questions that was raised and determined by the courts below was whether the deed dated 7-6-1969 was a deed of lease or a deed of licence; in other words, the question was whether the plaintiffs were lessees or licensees. Both the courts below have concurrently found that the transaction between the parties was a transaction of licence. To determine the character of this document, it will be appropriate to extract some relevant portions thereof herein below: "WHEREASIT IS AGREED AS FOLLOWS: xx xx xx (1) That the second parties, (plaintiffs) shall be competent to grow fishes in the said tank at any time they like and rear them with-in a period of one year from today. (2) That the second parties shall be competent to catch fish from said tank till 8th June, 1970 after which they shall have no right to catch them. (3) That excepting rearing and catching fish in the said tank for one year the second parties shall have no other right in the tank and this agreement is not intended to create any other right. (4) That the first party (defendants) shall not within the said period of one year interfere with the right of rearing and catching fish by the second parties. (5) That the year of licence given to the second parties by this agreement will expire on the 8th. June, 1970 and (the second parties) shall cease to do any act as contemplated by this agreement from 9th June, 1970, near shall have a right of renewal." The user of the word "licence" in this agreement clearly indicates that the parties to this agreement clearly intended this transaction to be a licence and not a lease. The aforesaid contract grants no interest in the tank or the water there of. It simply enables the second parties, namely the plaintiffs to rear fish and carry them away as their own property. This agreement is not connected with the ownership or possession of the tank, but only creates a personal right in the plaintiffs to rear fish and appropriate them, which act, without this permission would be otherwise unlawful. In order to rear fish in the tank, the plaintiffs would necessarily have to clear it up of all weeds and keep it in goad condition. The grant in question is nothing more than a permission for the beneficial enjoyment of the tank by the grantees. That is the ultimate object embodied in the deed of agreement extracted above. This Court in the case of Khan Saheb Muhammed Khan v. The State of Orissa and others, ILR 1954 Cuttack 671. has laid down the essential features of a licence. After considering the definition of "licence" occurring in section 52 of the Indian Easements Act and various decisions of high authorities like that of the Judicial Committee and of the Supreme Court, this Court said : "The essential features of a license are that it is not connected with the ownership or possession of the land but only creates a personal right which is permissive and legalises a certain act which would otherwise be unlawful............" This Court further said : "....... Whether an instrument operates as a lease or as a license is a matter not of words, but of substance - Maikutti v. Puzhakka . If the effect of the instrument is not to give exclusive possession it will take effect as license though called a lease or letting. On the other hand, if exclusive occupation is given it matters not whether, it is subject to reservations and restrictions. If it only gives the use of the property in a particular way or on certain terms, while it remains in the possession and control of the owner, it will only be a licence-See Mulla's Transfer of Property Act." To the same effect is another decision of this-Court in the case of Biswanath v. Gadadhar, AIR 1971 Orissa 115. where it is stated : "A license may be created by deed or by parol and in either case a mere license is revocable, but where it is coupled with a grant, it becomes irrevocable. In cases of a license by parol coupled with a grant of interest which is incapable of being granted otherwise than by deed, such a license operates as a mere license because of the invalidity of the grant and is revocable. "A mere license does not create any estate or interest in the property to which it relates. It only confers legality on an act which would otherwise become unlawful.............. The agreement between the parties, which is contended by the plaintiffs to embody a permanent lease, has not been registered and such a grant of permanent lease is incapable of being granted except by a registered deed and, therefore, this document cannot be construed as conferring a permanent lease on the plaintiffs. That apart, having regard to the terms of the agreement extracted above and the essential features enumerated regarding licence, it is clear that the transaction in question is nothing but a licence and not a lease as contended for by the plaintiffs. It is stated by the lower appellate court that Mr. Pal, appearing for the appellants fairly conceded before it that the appellants were only licensees in respect of the disputed tank and not lessees: It is, therefore, no longer open to the appellants to raise the question afresh that the transaction between the parties is a lease and not licence. Even if such a question were open, my answer would have been the same as has been given by the courts below on the authority of the aforesaid decisions.;

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