When the terms of the document leave the question of doubt, then resort could be had to proviso: SC

It is manifest from Section 95 and proviso 6 of Section 92 of the Evidence Act that it is only in cases where the terms of the document leave the question in doubt, then resort could be had to the proviso. But when a document is a straightforward one and presents no difficulty in construing it, the proviso does not apply. In this regard, we may state that Section 95 only builds on the proviso 6 of Section 92. (Para.14)

MANGALA WAMAN KARANDIKAR (D) TR. LRS. V .PRAKASH DAMODAR RANADE

Civil Appeal No. 10827 of 2010

7th April 2021

The three judges’ bench of Hon’ble Supreme Court consisting of Chief Justice of India N.V. Ramana, Justice Surya Kant, and Justice Aniruddha Bose allowed the appeal by restoring the decree of the trial court and setting aside the impugned order dated 07.11.2009 of the Bombay High Court.

Appellant’s husband was running a business of stationary in the name of “Karandikar Brothers” before his untimely demise in the year 1962. After his demise, she continued the business for some time. After a while, she was unable to run the business and accordingly decided to let the Respondent run the same for some time. She entered into an agreement dated 07.02.1963. In the 1980s, desiring to start her husband’s business again, the appellant herein issued a notice dated 20.12.1980 requesting the Respondent to vacate the suit premises by 31.01.1981. The Respondent replied to the aforesaid notice claiming that the sale of the business was incidental rather the contract was a rent agreement strictosensu. Aggrieved by the Respondent’s reply, the appellant filed a civil suit before the Court of Joint Civil Judge, Junior Division, Pune.

On 30.08.1988, the Trial Court ordered the respondent to hand over the suit property to the appellant. Aggrieved by the Trial Court judgment, the Respondent filed an appeal before the Court of Additional District Judge, Pune which was later got dismissed by an order dated 29.07.1991. Thereafter, aggrieved by the dismissal the respondent filed a Second Appeal before the High Court of Bombay. On Order dated 07.11.2009 the High Court of Bombay allowed the Second Appeal and set aside the Trial Court’s Order as well as the First Appellate Court’s Order and held that:

the Respondent had entered into a license agreement which is covered under Section 15 of the Bombay Rent Act. (Para 6)

Aggrieved by the same, the appellant filed this appeal.

It may be noted that Bombay High Court had appropriately identified the question of law in the following manner:

The debate, therefore, revolves around the question as to whether the agreement of 7th February 1963 was a license to conduct a business in the premises or was a license to run the existing business which was being run by the respondents in the suit premises. Does the document create an interest in the premises or in the business? (Para 15 of Order dated 07.11.2009)

The counsel for the appellant contended that the impugned order of the High Court erred in appreciating the language of the contract, which clearly points towards the intention of the parties to create a license for continuing existing business, which was run by the late husband of the appellant.

On the other hand, the counsel for the respondent has supported the judgment by stating that there is extrinsic evidence that shows that the contract entered into between the parties was a license to use the shop, which is covered under the Bombay Rent Act. In this light, he supports the impugned order to state that the Trial Court did not have jurisdiction in the first place.

After hearing both the parties at length, observing the principles on contractual interpretation, understanding the intention of lawmakers, the intention expressed by the parties and after dredging out the true meaning this court concluded that:

It is manifest from Section 95 and proviso 6 of Section 92 of the Evidence Act that it is only in cases where the terms of the document leave the question in doubt, then resort could be had to the proviso. But when a document is a straightforward one and presents no difficulty in construing it, the proviso does not apply. In this regard, we may state that Section 95 only builds on the proviso 6 of Section 92. (Para.14)

The High Court erred in appreciating the ambit of Section 95 of Evidence Act, which led to consideration of evidence which only indicates breach rather than ambiguity in the language of the contract. The evidence also points that the license was created for the continuation of existing business, rather than license/lease of shop premises. (Para 17)

Moreover, the contention that the aforesaid situation is covered by the Bombay Rent Act is misplaced. Once we have determined that the impugned agreement was a license for continuing existing business, Bombay Rent Act does not cover such arrangements. Therefore, the jurisdiction of the trial court is accordingly not ousted. (Para 18)

Subsequently, the appeal is allowed in the above terms.

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Swadheen Singh