1988 (8) TMI 425 - SC - Indian Laws

Summary

Issues Involved:
1. Applicability of Tamil Nadu City Tenants' Protection Act, 1922 (TN Act III of 1922)
2. Nature of the Lease: Land or Building with Appurtenant Land
3. Interpretation of Lease Deed Clauses
4. Tenants' Right to Purchase under Section 9 of the Act

Summary:

1. Applicability of Tamil Nadu City Tenants' Protection Act, 1922 (TN Act III of 1922):
The primary issue is whether the appellant company is entitled to protection u/s 9 of the Tamil Nadu City Tenants' Protection Act, 1922. The Act was designed to protect small tenants who constructed buildings on others' lands. The court noted it is doubtful whether affluent companies like the appellant should benefit from this Act but decided to interpret the statute based on its language.

2. Nature of the Lease: Land or Building with Appurtenant Land:
The lease deed dated 13.8.1951 described the demised property as "all that plot of vacant land and the buildings erected thereon." The High Court concluded that the lease was of a building with appurtenant land, not just land. The building occupied about one-eighth of the total area, indicating it was a substantial structure used as a residential building. The court agreed with this finding, emphasizing that the land was incidental to the enjoyment of the building, thus falling within the definition of "building" under the Act.

3. Interpretation of Lease Deed Clauses:
The appellant argued that the lease deed should be treated as creating two separate leases: one for the building and one for the land. This was based on the divisibility of clauses, separate rents, and provisions for erecting additional structures. However, the court concluded that the lease deed was a single, indivisible lease of both the building and the land. The rent was specified as an aggregate amount, and the lease did not envisage separate termination or renewal for parts of the leased premises.

4. Tenants' Right to Purchase under Section 9 of the Act:
The court examined whether the appellant could exercise the right to purchase the land u/s 9 of the Act. It was determined that since the lease was of a building with appurtenant land, the appellant was not entitled to the rights conferred by section 3 or section 9 of the Act. The lease contained usual clauses and covenants expected in a lease under the Transfer of Property Act, and there was no specific clause denying compensation to the lessee for structures, which might have indicated an attempt to circumvent the Act.

Conclusion:
The appeal was dismissed, and the court upheld the High Court's decision that the lease was of a building with appurtenant land, making the appellant ineligible for protection under the Act. The respondents were entitled to their costs.