Mere Acceptance Of Rent After Notice To Quit Doesn't Waive Termination Of Tenancy: Calcutta High Court

The Calcutta High Court has upheld a decree directing the eviction of Budge Budge Company Limited from premises owned by The Calcutta Gujrati Education Society, holding that the tenancy stood validly terminated under the Transfer of Property Act and rejecting the company's objections based on waiver of notice, multiplicity of proceedings, limitation, and lack of jurisdiction.A Division Bench of Justice Debangsu Basak and Justice Md. Shabbar Rashidi dismissed the company's appeal against a 2024 decree passed by a Single Judge directing recovery of possession and payment of mesne profits.The Court observed: "Rent was paid without deciding or without prejudice to the rights and interests of the parties as directed by this Court and acceptance of such rent without anything else is not tantamount to waiver of notice."The dispute arose out of a lease executed in 1973. The landlord had initially sought eviction under the West Bengal Premises Tenancy Act, 1956 by filing an ejectment suit in 1992 after alleging default in payment of rent. That suit was later withdrawn. Following the withdrawal, the landlord accepted rent for a few months before issuing a fresh notice under Section 106 of the Transfer of Property Act in July 2003 and instituting a fresh suit for eviction.The tenant contended that the original tenancy could only be terminated in the event of default in payment of rent, which had not occurred until August 2003. It argued that it had become a statutory tenant under the West Bengal Premises Tenancy Act and that acceptance of rent after withdrawal of the earlier suit did not create a fresh tenancy or permit the landlord to invoke the Transfer of Property Act.The company further argued that the earlier ejectment suit, which had temporarily revived after an appellate order, resulted in two parallel proceedings over the same cause of action, rendering the subsequent suit barred by limitation and Order XXIII Rule 1 of the Code of Civil Procedure. It also claimed that the landlord had waived the notice to quit by accepting rent and retaining the security deposit.Rejecting these submissions, the Division Bench affirmed the Trial Court's finding that acceptance of rent after withdrawal of the earlier proceedings amounted to creation of a fresh tenancy by "holding over" under Section 116 of the Transfer of Property Act. Consequently, the subsequent notice dated July 5, 2003 validly terminated that fresh monthly tenancy.The Court observed that the fresh eviction suit was founded on a distinct cause of action arising after the creation and termination of the new tenancy and was therefore not barred merely because an earlier eviction suit had existed.The Bench also rejected the tenant's contention that acceptance of rent after issuance of the notice to quit amounted to waiver under Section 113 of the Transfer of Property Act.Referring to settled Supreme Court precedent, the Court reiterated that mere acceptance of rent after termination of tenancy is insufficient to establish waiver unless accompanied by evidence demonstrating an intention on the landlord's part to treat the lease as subsisting.The Bench noted that in the present case there was no pleading or evidence establishing such intention. Instead, rent accepted during the pendency of the litigation was pursuant to court orders and expressly without prejudice to the rights and contentions of the parties.The Court further held that there was no infirmity in the institution of the second eviction suit under the Transfer of Property Act after withdrawal of the earlier proceedings under the West Bengal Premises Tenancy Act.Addressing the appellant's challenge to the jurisdiction of the High Court on the ground that the dispute ought to have been tried as a commercial dispute, the Bench held that the objection had never been raised before the Trial Court despite the suit remaining pending for several years. The Commercial Courts Act came into force long after institution of the suit in 2003, by which time the proceedings had substantially progressed.The Court held that no prejudice had been demonstrated by the tenant and observed that the objection appeared to have been raised belatedly only to prolong occupation of the premises.The Bench remarked:"The materials on record demonstrates that the appellants, by taking such objection at this stage, are trying to prejudice the case of the plaintiff/respondent by holding on to the subject premises for a paltry amount of rent."The Court also rejected objections relating to pecuniary jurisdiction, valuation, limitation, multiplicity of proceedings, and the maintainability of the suit by the registered society, finding that all such issues had been correctly decided by the Single Judge.Finding no error in the eviction decree or the award of mesne profits, the Division Bench dismissed the appeal and affirmed the judgment directing Budge Budge Company Limited to hand over possession of the premises to the landlord.Case...

Mere Acceptance Of Rent After Notice To Quit Doesn't Waive Termination Of Tenancy: Calcutta High Court

Srinjoy Das

This is a premium content
Available exclusively to
Our subscribers

INR 1099+GST

Tags

Srinjoy Das

Mere Acceptance Of Rent After Notice To Quit Doesn't Waive Termination Of Tenancy: Calcutta High Court

Srinjoy Das

This is a premium content Available exclusively to Our subscribers

INR 1099+GST

Tags

Srinjoy Das

This is a premium content
Available exclusively to
Our subscribers