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Revision

Application No. 162 of 1956, decided on 27th May 1959. .

--- Concurrent lease‑New lease operates as transfer of reversion, and is valid‑Not a mer3 right of re‑entry‑S. 6 (b) no bar to subsequent lease.

The landlord having first created a prior lease from month to month of certain premises in favour of Y, then transferred the whole building of which. the premises leased earlier formed a part to A. Upon A's suit for ejectment of Y, the latter pleaded that there was no privity of contract between him and A, and further that what was transferred by the landlord to A was a mere right of re‑entry to which transfer section 6 (b), Transfer of Property Act was a bar. Moreover, as the lease in favour of A was an oral one and was not accompanied by possession, there was no compliance with section 107 of the Transfer of Property Act.

that there could be a valid lease of the property even though there was a prior tenancy existing. The new lease amounted to a transfer of the reversion and in a case where the person in possession is a tenant from month to month, a sub sequent lease is very near a true lease though to the new lessee only the right to get actual possession has been transferred. The new lessee can terminate the existing tenancy and get actual possession, so that there is almost a transfer of actual possession to him by the landlord.

Delivery of possession under the subsequent lease was not necessary vide Notification No. 12501 dated 8th December 1908, page 2116 of Part I of the Bombay Gazette, 1908 which exempted such leases from the operation of section 107, Transfer of Property Act in the Bombay Presidency of which Sind formerly formed a part. [p. 107]B

Moreover, section 6'(b), Transfer of Property Act was inappli cable, as A was not asking for re‑entry on breach of a condition but for ejectment in the assertion of his right to terminate the tenancy. [p. 1071C

A concurrent lease is a well‑recognised form of transfer. The operation of a concurrent lease is to transfer part of the reversion of the landlord to the lessee ; the landlord cannot after the execution of such concurrent lease recover rent from the first lessee. [p. 1061D

Section 109 of the Transfer of Property Act supports the proposition that there can be partial transfer of the interest of the landlord and that even the transferee of partial interest would become the landlord in respect of the tenancy. According to that section if there be a transfer of any part of the interest of the landlord th transferee shall possess all the rights of the landlord.

[p. 1071E e

If the premises are already in the possession of the tenant a fresh tenancy will operate to transfer to the new tenant the right of reversion of the landlord. By a lease the lessor transfers to

the lessee possession as well as his right to possession. If he has not got possession then all that stands to be transferred to the tenant will be the right to possession, to the extent to which it

vests in the landlord in spite of the previous lease. There is no bar to the transfer of a right to possession and such a transfer is involved in the creation of a tenancy. If the premises are already in the possession of a tenant from month to month then the new lessee will be entitled to serve a notice of ejectment on the first tenant in accordance with law. If the premises are in possession of a tenant for a fixed period the new lessee would be entitled to take advantage of any breach of conditions by the previous tenant which may involve a forfeiture of his tenancy.

[p. 105JF

Parbhu Ram v. Tek Chand A I R 1919 Lah. 31 ; Ram Anant Singh and another v. Shankar Singh 30 1 L R All. 369, Manikkam Pillai v. Rathnasami Nadar and others 43 1 C 210 and Law of Landlord and Tenant by Woodfall ref.

Nurul Arfin for Petitioner.

Ghulamali for Respondent.

Dates of hearing: 23rd February 1959; 2nd and 4th March 1959

This is a revision petition against the order of the Chief Judge of the Karachi Small Causes Court dismissing an application for ejectment of a tenant under'section 18 of the Karachi Small Causes Courts Act.

Yunus Ali Kirmani, the opponent in this petition was allotted by the Rent Controller in April 1950 a flat in a building known as Haji Ahmad Haji Yar Muhammad Trust Building. He took possession of the flat and continued to pay rent up to September 1950. According to the allegations of Agha M. Jaffri, the petitioner before me, the Secretary of Ha ji Ahmad Haji Yar Muhammad Trust 'had entered into an understanding with him by which the whole of the building of which the flat in dispute is

a part was let on rent to him as from 1st February 1951. The terms of this understanding which are incorporated in a letter dated 7th February 1951 were that the petitioner would be the tenant in respect of the entire building, that the oponent would be his sub‑tenant and would pay him rent from' 1st February 1951 and when the opponent vacated the flat he would not be allowed to transfer his tenancy rights, and that the Trust would have no objection to the petitioner having it allotted in his name.

In the application under section 18, the opponent contended that there was no privity of contract between him and the petitioner and the petitioner was not his landlord and therefore was not entitled to apply. This objection has been given effect to by the learned Chief Judge of the Small Causes Court.

It is contended before me on behalf of the petitioner that there was no bar at all to the landlord creating a fresh tenancy in respect of the same premises which had been let out to a tenant and that the creation of such a tenancy would operate as an assignment of the interest of the landlord and would entitle him not only to receive rent of the premises but also to exercise all the rights of the landlord as against the tenant. Reference is made in this connection to section 109 of the Transfer of Property Act which enables the transferee of any interest of the landlord to eject the tenant.

A number of authorities have been cited before me in support of the contentions put forward and I have felt no difficulty in agreeing with them. If the premises are already in the possession of the tenant a fresh tenancy will operate to transfer to the new tenant the right of reversion of the landlord. By a lease the lessor transfers to the lessee possession as well as his right to possession. If he has not got possession then all that stands to be transferred to the tenant will be the right to possession, to the extent to which it vests in the landlord in spite of the previous lease. There is certainly no bar to the transfer of a right to possession and such a transfer is involved in the creation of a tenancy. If the premises are already in the possession of a tenant from month to month then the new lessee will be entitled to serve a notice of ejectment on the first tenant in accordance with law. If the premises. are in possession of a tenant for a fixed period the new lessee would be entitled to take advantage of any breach of conditions by the previous tenant which may involve a forfeiture of his tenancy. Before proceeding to examine the authorities it will be convenient to reproduce section 109 of the Transfer of Property Act. It runs :‑

"109. If the lessor transfers the property leased, or any part thereof, or any part of his interest therein, the transferee, in the absence of a contract to the contrary, shall possess all the rights, and, if the lessee so elects, be subject to all the liabilities of the lessor as to the property or part transferred so long as he is the ' owner of it ; but the lessor shall not, by reason only of such transfer, cease to be subject to any of the liabilities imposed upon him by the lease, unless the lessee elects to treat the transferee as the person liable to him

Provided that the transferee is not entitled to arrears of rent

due before the transfer, and that, if the lessee, not having reason to believe that such transfer has been made, pays rent to the lessor, the lessee shall not be liable to pay such rent over again to the transferee.

The lessor, the transferee and the lessee may determine what proportion of the premium or rent reserved by the lease is payable in respect of the part so transferred, and, in case they disagree, such determination may be made by any Court having jurisdiction to entertain a suit for the possession of the property leased."

In Parbhu Ram v. Tek Chand (1), it was held that a lessee was a transferee of the interest of the landlord within the meaning of section 109 of the Transfer of Property Act. In Ram Anant Singh and another v. Shankar Singh (2), two leases had been executed in respect of the same property, the first from the year 1308 to 1314 Fasli and the second from 1312‑1320 Fasli. The second lessee had been authorised to recover the rent of the land in dispute from the first lessee. On the failure of the second lessee to pay rent for 1312‑1313 Fasli a suit was filed by the lessor for recovery of the lease money. The District Judge dismissed the suit on the ground that as the first lease was not cancelled and the first lessee was not ejected the second lessee was not liable for the rent for this period. Stanley, C. J., and Karamat Hussain, J., held that the lease in favour of the second lessee operated as an assignment of the landlord's interest during the term of the earlier lease and thereafter as a lease for the residue of the term. The learned Judges quoted with approval a passage from the Law of Landlord and Tenant by Woodfall wherein it was stated :‑

"A concurrent lease is one granted for a term which is to commence before the expiration or other determination of a previous lease of the same premises to another person. If under seal, it operates as an assignment of part of the reversion during the continuance of such previous lease, and from henceforth as a lease in possession during the residue of the terms therein expressed to be granted, it entitles the lessee as assignee of part of the reversion to the rent reserved in the previous lease and to the benefit of the covenants therein contained which are to be respectively paid and performed during the then residue of the term granted by the first lease and the continuation of the concurrent lease."

It appears from this quotation that a concurrent lease is a

well‑recognised form of transfer. The learned Judges also

referred to the case of Harmer v. Bean (3), where Baron Parks, J.,

held under the similar circumstances that the operation of a

concurrent lease of the kind was to ir lnsfer part of the reversion of

the landlord to the lessee, and that the landlord could not after the

execution of : Ll , h < <::‑,, Ui‑ent lease recover rent from the first lessee.

In Manikkam Pillai v, Ra thnasami Nadar and others (4) the same

proposition is laid down. ‑

(1) A I R 1919 Lah. 31 (2) 30 1 L R All. 369

(3) (1853) 3 C & K 307 (4) 43 1 C 210

On behalf of the respondent it was urged'that the concurrent lease would amount to a transfer of a mere right of re‑entry and this would be covered by section 6 (b) of the Transfer of Property Act according to which a mere right of re‑entry for breach of a condition subsequent cannot be transferred to anyone except the owner of the property affected thereby. But it cannot be said that this was a transfer of a mere right of re‑entry. In any case we are not concerned here with breach of a condition. The respon dent was just a tenant from month to month whose tenancy could be terminated by a notice. The right of reversion of the landlord was transferred to the petitioner. The petitioner has now the right to serve a notice on the respondent and terminate his tenancy. He is not asking for re‑entry on breach of condition. Section 6 (b) relates to cases when there is forfeiture of the tenants' right on account of breach of a condition.

Section 109 of the Transfer of Property Act supports the proposition that there can be partial transfer of the interest of the landlord and that even the transferee of partial interest would become the landlord in respect of the tenancy. According to that section if there be a transfer of any part of the interest of the landlord the transferee shall possess all the rights of the landlord.

I would, therefore, hold that apart from the technical objec tion, to which I am going to refer, there could have been a valid lease of the property even though there was a prior tenancy existing. The new lease, as stated above, would amount to a transfer of the reversions, but I go a step forward and say that in a case where the person in possession is a tenant from month to' month, a subsequent lease is very near a true lease though to the new lessee only the right to get actual possession has been trans ferred. The new lessee can terminate the existing tenancy and get actual possession, so that there is almost a transfer of actual possession to him by the landlord.

It was urged on behalf of the respondent that as the Transfer of Property Act is in force in the town of Karachi, a valid lease could only have been effected in accordance with the provisions of section 107 of the Transfer of Property Act, i.e., if the period of the lease exceeded one year or if a yearly rent was reserved, the lease could only be made by a registered instrument, and in other cases it could be made either by a registered instrument or by an oral agreement accompanied by delivery of possession. In the present case, the lease was not for more than a year, and, therefore it could be effected by an oral agreement accompanied by delivery of possession. Learned counsel for the respondents contends that there was no proof of delivery of possession or even of any oral agreement. Learned counsel for the petitioner, on the other hand, cites Notification No. 12501 dated the 8th of December 1908 by the Government of Bombay (Sind was at that time part o

Bombay) at page 2116 of Part I of the Bombay Gazette of 1908, which provides that delivery of possession is not necessary for a lease. Under the proviso to section 107 of the Transfer of Property Act the Provincial Government had the power to exempt lease from the operation of that section.

It appears then that there was no necessity for a registered

deed, nor for delivery of possession. A further objection is raised that there is no sufficient proof on the record either of a written or an oral agreement of tenancy in favour of the petitioner. On a reference to the record I find there is some force in this objection by the respondent, but it does appear to me at the same time that the petitioner was misled as to the proof which he had to adduce in support of the tenancy for in the judgment of the learned Chief Judge the existence of a tenancy in his favour has been assumed. It would not be proper, therefore, to decide as to

whether there is or is not at present a tenancy in his favour on the present record. I would, therefore, accept this revision petition and remand the case to the learned Judge of the Small Cause Court with a direction that he should determine the question as to whether a tenancy was created in favour of the petitioner afresh after allowing both parties an opportunity to produce evidence. Parties will bear their own costs in both the Courts.

[Annorinced by Qadeeruddin, J. in the absence of Kaikaus. J.].

n. H. ' Case remanded.

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