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M.N. Clubwala v. Fida Hussain Saheb, 1964

M.N. Clubwala v. Fida Hussain Saheb, (1964) 6 SCR 642, 651


This case interpretation/case summary is written by Ms. Swati Sharma a student at the Faculty of Law (Delhi University). If you also want to publish your articles or case interpretations/summaries, send your work to niyamskanoon09@gmail.com.

Case Details

PETITIONER: MRS. M. N. CLUBWALA AND ANR.

Vs.

RESPONDENT: FIDA HUSSAIN SAHEB AND ORS.

DATE OF JUDGMENT: 03/02/1964

BENCH: MUDHOLKAR, J.R. SUBBARAO, K.

CITATION: 1965 AIR 610 1964 SCR (6) 642

Introduction 

  1. The case of M.N. Clubwala v. Fida Hussain Saheb (1964) under the Delhi Rent Control Act is a landmark judgment that clarifies the distinction between a lease and a license and the jurisdiction of the Rent Controller.
  2. The primary issue in this case was whether the agreements between the landlord (M.N. Clubwala) and the shopkeepers (Fida Hussain Saheb) created a lease or a license. 

Facts of the Case

  1. M.N. Clubwala (Landlord) used his building as market by obtaining license from the Municipal Commissioner. In this market, several individuals including the respondent (Fida Hussain Saheb) set up their shops.
  2. A dispute arose between Fida Hussain and the contractor appointed by the appellant (M.N. Clubwala) over the extra fees being demanded for the shop. 
  3. Thereafter respondent (Fida Hussain Saheb) claimed that they were tenants under a lease, thereby entitled to protections under the Delhi Rent Control Act, 1958. On the other hand, Clubwala argued that the arrangement was merely a license, which does not give jurisdiction to the rent controller to protect their rights under the Rent Control Act. 

Main Issue

  1. Whether the agreements between the landlord (M.N. Clubwala) and the shopkeepers (Fida Hussain Saheb) created a lease or a license. 
  2. Whether the Rent Controller has juridiction to decide the present case.

Case History

  1. First Additional City Civil Court favored the respondent. Hence the appellant approached before the City Civil Court.
  2. City Civil Court affirmed the judgment given by the Additional City Civil Court.
  3. The High court also favored the respondent thus the appellant (M.N. Clubwala) appealed by special leave before the Supreme Court.

Decision 

  1. The agreement between the Landlord and the shopkeepers created a license agreement. 
  2. Hence the Rent Controller has no jurisdiction in the present case.
  3. The Court allowed appeal while reversing the decisions of the Lower Courts.

Ratio Decidendi

  1. The Court while referring to Errington v. Errington and Woods, 1952, Cobb v. Lane, 1952 and Vurum Subba Rao v. Eluru Municipal Council, 1956 said that deciding exclusive possession over the premises is not conclusive evidence for determining the nature of the relationship between the parties.
  2. The Court while observing the intention of the parties said that 
    1. Shopkeepers were following several terms and conditions to continue their shops in said premises. For example, None of the shopkeepers were allowed to stay in the market after closing time, In case of default of payment for three days the shopkeepers were liable to be evicted by being given 24 hours etc.
    2. In case Shopkeepers does not fulfill the conditions set by the agreement. It becomes the ground for eviction.
  3. Section 52 and Section 62(c) of the Indian Easement Act, 1882: 
    1. When one person permits to another or to a definite number of other persons 
    2. A right to do or continue to do 
    3. In or upon the immovable property 
    4. With the permission of the granter 
    5. Some acts in the absence of such right be unlawful
    6. Such a right is called a license.
  4. Section 62(c) of the Indian Easement Act, of 1882
    1. A licence is deemed to be revoked where it has been either granted for a limited period or acquired on condition that it shall become void on the performance or nonperformance of a specified act and the period expires or the condition is fulfilled. 

Legal Provisions (Lease and Licence)





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