1927 (2) TMI 13 - HC - Indian Laws

Summary

Issues Involved:
1. Ejectment of tenant for non-payment of rent.
2. Interpretation of "days of grace" in the lease agreement.
3. Equitable relief against forfeiture.
4. Judicial discretion in granting relief against forfeiture.

Issue-wise Detailed Analysis:

1. Ejectment of Tenant for Non-Payment of Rent:
The plaintiff, as the landlord, sued to eject the defendant, his tenant, on the grounds that the rent for the land was not paid by the tenant on or before the 1st April for the fasli year, as stipulated in the lease agreement. The lease contained a clause that required the tenant to pay the rent due on or before the 1st March, and if defaulted, to pay with interest at 12% per annum by the 1st April. Failure to pay by this date would result in forfeiture and ejection without notice.

2. Interpretation of "Days of Grace" in the Lease Agreement:
The appellant's counsel argued that the period between 1st March and 1st April constituted "days of grace," implying that the court's equitable right to relieve the tenant against forfeiture was nullified. The judgment clarified that this period should not be considered "days of grace" as the rent was due on 1st March, and the landlord had the right to sue for payment from that date. The term "days of grace" was deemed inappropriate in this context as it usually refers to a period during which no right of action exists for the party granting the grace period.

3. Equitable Relief Against Forfeiture:
The appellant's counsel contended that if a lease provided for forfeiture not on the mere non-payment of rent but on subsequent default, such forfeiture was not subject to relief. The judgment disagreed, stating that most leases provide for forfeiture only upon further default after the rent becomes due. The cited cases, such as Narayana Kamti v. Handu Shetty and Narain-Naikan v. Vasudevan Bhatta, were discussed to illustrate that forfeiture clauses are generally not considered penal if they allow for a period of default before forfeiture.

4. Judicial Discretion in Granting Relief Against Forfeiture:
The judgment emphasized that the court has the discretion to relieve against forfeiture, even when a grace period is provided in the lease. The case of Ramakrishna v. Baburayya was cited, highlighting that relief against forfeiture depends on the specific facts of each case. The judgment agreed with the principle that forfeiture clauses are generally penal and that courts should exercise discretion based on the circumstances. The judgment also noted that the lower courts had exercised their discretion in favor of the tenant, and there was no reason to interfere with that discretion.

Conclusion:
The second appeal was dismissed, affirming the lower courts' decisions to grant relief against forfeiture to the tenant. The court found no sufficient grounds to interfere with the discretion exercised by the lower courts, especially given the circumstances suggesting that the landlord may have made it difficult for the tenant to pay rent. The appeal failed, and costs were awarded to the respondent.