Rent Note is a lease

Comment : A Rent Note issued by a tenant – is also lease within the meaning of S.2(7) of the Registration Act, and can be relied upon (if not compulosarily registrable) to establish Landlord-Tenant Relationship
Allahabad High Court
Ram Sewak Jaiswal vs Abdul Majeed And Ors. on 21 March, 1980
Equivalent citations: AIR 1980 All 262
Author: D Nandan
Bench: D Nandan


Deoki Nandan, J.

1. This is a plaintiffs second appeal in a suit for ejectment from a house. The plaintiff’s case was that Aziz Uddin, who was the father of the three defendants; Abdul Majeed, Abdul Hameed and Abdul Wahid, took the house in suit as a tenant for eleven months on payment of Rs. 5/- per month as rent, under a Sarkhat dated 12th Oct. 1957. The defendants denied the plaintiff’s title and claimed that they were occupying the house as licensees under the original owner thereof. They even alleged that although they had come to know from the proceedings in Suit No. 396 of 1964 (Lakhoo v. Sakina Bibi) to which they and the present plaintiff also were parties, Aziz Uddin, had purported to sell the house to the present plaintiff but, according to the defendants, he was not competent to do so as he was a mere licensee. The Sarkhat was also denied and it was contended that at any rate it was inadmissible in evidence for want of registration.

2. Several issues were raised in the case. The suit was decreed by the trial court for ejectment and recovery of Rupees 180/- as arrears of rent and damages up to the date of the suit and pendente lite and future at the rate of Rs. 5/- per month. The lower appellate court has, however, dismissed the suit primarily on the ground that the Sarkhat was inadmissible in evidence for any purpose whatsoever and that therefore, the relationship of landlord and tenant not having been proved, the suit was liable to be dismissed.

3. It is not necessary to go into all the involved allegations and the contentions raised in the defence, nor is it necessary to notice all the issues raised at the trial. Suffice it to observe that the plaintiff had clearly and categorically pleaded that he was not basing his claim for the defendants’ ejectment on the basis of his title to the property but on the relationship of landlord and tenant, about which it was alleged that after the expiry of 11 months period of the Sarkhat. Aziz Uddin had no further right to remain in occupation of the house in suit and that his status was merely that of a tenant holding over, or of a tenant at will, or tenant at sufference, and that the defendants, who had continued to remain in occupation even after Aziz Uddin’s death, could claim no higher rights in the house than those of their predecessor, namely, Aziz Uddin. The main question which was accordingly raised before me in the second appeal was about the admissibility and effect of the Sarkhat. Ext. 4, which has been executed by Aziz Uddin alone and is consequently not a lease within the meaning: of Section 107 of the T. P. Act. It is a rent note. Not being a lease, or in other words an instrument by which a lease of immoveable property could be created, in accordance with the requirements of Section 107 of the T. P. Act. for it is not executed by both the lessor and the lessee, it could not be said to be an instrument requiring registration according to the requirements of that provision, for even if it had been registered, it could not have created a lease. The period for which the house was taken according to the terms of the rent note was 11 months and the rent reserved therein was Rs. 5/- per month, it could not accordingly be said to be compulsorily registrable under Section 17(1)(d) of the Indian Registration Act, 1908, although it could be said to be a lease as defined under clause (7) of Section 2 of that Act. Not being compulsorily regristrable whether under Section 17 of the Indian Registration Act, 1908, or any provision of the T. P. Act. 1882. Section 49 of the Registration Act did not operate to exclude the document from being received as evidence of the transaction of lease, the terms whereof were recorded therein. T am supported in this inference by the following comment, in the VIth Edition of Mulla’s T. P. Act which appears to be well supported by the cases noted thereunder:–

“Rent Notes : These are agreements to lease which fall under the wider definition of lease in the Registration Act which includes a Kabuliyat and an undertaking to cultivate or occupy. The rent note or agreement to lease may be in counter-part signed by parties or it may be in correspondence; or it may be an application for a lease accepted by the endorsement of the word “granted”, or it may be an application for a lease accepted orally or by the conduct of the lessor putting the applicant into possession ………… If there is a present demise the rent note operates as a transfer by way of lease and if the term does not exceed one year, registration is not necessary ………… But whether a rent note is a lease as defined in the section is a question on which there was a conflict of decision. The Allahabad High Court held that a lease must be a deed signed by the lessor ………… This conflict of decision is now settled by the amendment of Section 107 which requires a lease to be signed both by the lessor and by the lessee. A rent note or a Kabuliyat signed only by the intending lessee is not a lease under this Act, but would be a lease under the Registration Act and the question of its registration would be decided under that Act. A rent note not compulsorily registrable under the Registration Act. executed by a tenant in favour of a landlord, if not registered can be relied upon to establish the relationship existing between the parties.”

4. Learned counsel for the respondents, however, urged that the lower appellate court was right in relying on the decision of the Supreme Court in Mst. Kirpal Kuar v. Bachan Singh (AIR 1958 SC 199) and holding on that basis that the rent note Ext. 4, in the present case, was compulsorily registrable and was, therefore, inadmissible in evidence for any purpose whatsoever. In Mst. Kirpal Kaur case, the Supreme Court observed that the High Court had held the agreement in question in that case to be admissible to prove the nature of possession, and reliance was placed for that purpose on the decision of the Privy Council in Varade Pillai v. Jeevarathnammal 46 Ind App 285 : (AIR 1919 PC 441. The Supreme Court, explained the position of that case by observing that in the case before the Privy Council the petition before the Collector was held to be admissible in the absence of registration for showing that the subsequent possession of Duraisani was as a donee and owner of the land and not as a trustee or manager for the two donors and, therefore, to show that nature of such possession was adverse to them. Having thus observed the basis of the decision of the Privy Council in Varada Pillai’s case the Supreme Court held that that case could not be applied to the facts of Mst. Kirpal Kuar’s case before it inasmuch as while in Varada Pillai’s case Duraisani had got into possession only after the petition and claimed to retain possession only under the gift mentioned in it, “The petition was therefore admissible in evidence to show the nature of her possession. In the present case Harnam Kaur had been in possession before the date of the document and to admit it in evidence to show the nature of her possession subsequent to it would be to treat it as operating to destroy the nature of the previous possession and to convert what had started as adverse possession into a permissive possession and, therefore, to give effect to the agreement contained in it which admittedly cannot be done for want of registration. To admit it in evidence for the purpose sought would really amount to getting round the statutory bar imposed by Sec. 49 of the Registration Act.” The lower appellate court appears to have mis-applied the decision of the Supreme Court in Mst. Kirpal Kuar’s case to the facts of the present case. It has not been proved ‘n the present case that Aziz Uddin had been in adverse possession before the execution of the Sarkhat in 1957. Indeed, there are decrees against him in the plaintiffs favour showing that he was in possession for some time at an earlier stage also as a tenant. The Sarkhat does not purport to bring about any change in the nature of any pre-existing possession of Aziz Uddin over the house in suit. Indeed, the Sarkhat Ext. 4., even amounts to an unequivocal admission by the defendants father of his having taken the house in suit as a tenant on payment of Rs. 5/-per month as rent on and with effect from 1st October, 1957. Learned counsel for the defendant respondents had also relied on the case of Jai Narain Dass v. Smt. Zubeda Khatoon (AIR1972 AH 494). The question there appears to have been whether the term of clause 7 contained in an unregistered rent note could be insisted upon. The learned Judge observed that the document “ought to have been got registered under the provisions ef the Indian Registration Act and as the same was not done it was not admissible except for collateral purposes and, therefore, reference to clause 7 thereof was not possible.” For the reasons given above, I do not with respect agree that the rent note in that case required registration in case although it was not signed by the lessor and was not for a period exceeding one year or did not reserve an yearly rent but it is not necessary to refer the matter to a larger Bench on this point because the learned Judge was of the view even in that case that such a document was admissible for collateral purposes such as a purpose of finding out the nature of possession of the defendants in the present case.

5. Learned counsel for the defendant-respondents had further filed a certified copy of a judgment dated 6th December, 1975 of the court of the IXth Additional District Judge, Allahabad in Civil Appeal No. 397 of 1966 arising from Suit No. 396 of 1964, along with an application for its admission under Order 41 Rule 27 of the Civil P. C. There was a plea raised in the present case that the judgment of the trial court in Suit No. 396 of 1964 operated as res judicata. The plea was repelled by the trial court in the present case. On appeal, the matter was not gone into by the lower appellate court as it allowed the appeal on the ground that the Sarkhat was not admissible in evidence for any purpose whatsoever in the present case. Under the circumstances, I admitted the certified copy of the said judgment in Civil Appeal No. 397 of 1966. But a perusal of that judgment shows that the points in issue in the present case were not decided in that Suit No. 396 of 1964 and the suit had been dismissed, so that even if the points had been decided against the parties in the present case, neither of them could have appealed therefrom. That judgment cannot, therefore, be said to operate as res judicata on any point or on any ground whatsoever in the present case.

6. No other point was raised before me and the findings on the other relevant issues entitling the plaintiff to decree, as recorded by the trial court being in his favour and not having been disturbed or touched by the lower appellate court, and not having been canvassed before me, the appeal must be allowed and the decree passed by the trial court restored.

7. In the result the appeal is allowed. The judgment and decree of the lower appellate court are set aside. The decree of the trial court decreeing the suit for ejectment of the defendants from the house in suit and for recovery of Rs. 180/- up to the date of the suit and for pendente lite and future damages at the rate of Rs. 5/- per month is restored with costs throughout


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