Khem Chand v. Babita

14. SMT.

JUSTICE NEENA BANSAL KRISHNA JUDGMENT (oral)

1. The present Regular Second Appeal under Section 100 of the Code of Civil Procedure, 1908 (hereinafter referred to as „CPC‟) has been filed against the Judgment and Decree dated 01.04.2026, whereby the learned First Appellate Court upheld the Judgment and Decree dated 22.03.2023, passed by the learned Civil Judge, decreeing the Suit for Recovery of Possession and arrears of rent in favour of the Plaintiffs/Respondents.

2. The Plaintiffs/Respondents had filed a Civil Suit bearing CS SCJ No.1703/2016for Recovery of Possession and arrears of rent of Rs.2,106/for the period from 01.01.2004 to 30.06.2005, against the Appellant/Defendant in respect of land measuring 75 sq. yards, forming part of Municipal No.2365, Khampur Village, New Delhi-110008 (hereinafter referred to as the "Suit Property").

3. The brief facts are that the Defendant was inducted as a tenantby the Plaintiffs, in respect of the Suit Property at a monthly rent of Rs.117/- per month. The tenancy of the Defendant/Appellant was terminated vide Legal Notice dated 07.06.2005, whereby the Defendant/Appellant was asked to vacate the Suit Property by the end of 30.06.2005, and pay the arrears of rent Rs.2,106/- for the period from 01.01.2004 to 30.06.2005, after removing the temporary structures raised thereon.

4. Since the Defendant failed to vacate the Suit Property and also failed to clear the arrears of rent, despite service of Notice, the Suit for Recovery of Possession and arrears of rent was filed.

5. The Defendant, in his Written Statement, took the preliminary objection that the Suit was not maintainable as the Suit Property was a builtup premises bearing Municipal No.2365, Main Patel Road, Khampur, New Delhi-110008 and was governed by the provisions of the Delhi Rent Control Act, 1958. It was asserted that since the Defendant was a tenant protected under the Delhi Rent Control Act, 1958, the Civil Court had no jurisdiction to entertain the Suit in view of Section 50 of the aforesaid Act.

6. The Defendant further stated that he was not merely in occupation of vacant land, but was occupying built-up premises where he was residing with his family and also carrying on the business of electrical goods. Even if the Plaintiffs‟ case was accepted that only vacant land had initially been let out, the Defendant could still not be evicted, since he had raised permanent constructionin the Suit Property, with the knowledge and consent of the Plaintiffs and their predecessors, who were fully aware about the raised construction on the Suit Property, in which the defendant was residing and carrying on business.

7. He had been granted permission/licence to raise permanent construction and, acting upon such licence, had executed work of a permanent character after incurring expenses. The Defendant, therefore, invoked the protection of Section 60(b) of the Indian Easements Act, 1882.

8. The Defendant further claimed that hehad been openly and continuously asserting his tenancy rights in respect of the built-up premises for more than twelve years, to the knowledge of the Plaintiffs and their predecessors and had, therefore, acquired an indefeasible right of tenancy protected under the Delhi Rent Control Act, 1958.

9. It was also contended that the Notice dated 07.06.2005 was invalid, misconceived and ineffective, as it had not been issued by all the owners of the Suit Property.

10. The Defendant denied the site plan filed by the Plaintiffs. He claimed that he had electricity connections in his name in respect of the Suit Property and had also been paying tax in respect thereof.

11. It was further denied that any rent was due and payable. The Defendant claimed that he had tendered rent to the Plaintiffs, but they refused to accept the same, though he had always been ready and willing to pay rent.

12. On merits, all other averments made in the Plaint were denied.

13. In the Replication, the Plaintiffs reiterated and reaffirmed the contents of the Plaint and denied all the averments made in the Written Statement. The Plaintiffs denied that the Suit Property was governed by the Delhi Rent Control Act, 1958 or that the Defendant had acquired any statutory protection thereunder. The plea of irrevocable licence under Section 60(b) of the Indian Easements Act, 1882 was also denied.

14. On the basis of the pleadings of the parties, the following Issues were framed: “(i) Whether the Suit is barred under the DRC Act? OPD.

(ii) Whether the Suit is without cause of action? OPD.

(iii) Whether the Plaintiff is entitled to the decree of possession as prayed for? OPP.

(iv) Relief.”

15. In support of their case, the Plaintiffs examined Plaintiff No.2, Sh. Naveen Verma, as PW-1, who tendered his evidence by way of affidavit Ex.PW-1/A.PW-1 relied upon the Legal Notice dated 07.06.2005 Ex.PW- 1/1; Postal Receipt Ex.PW-1/2; Site Plan Ex.PW-1/3; and Rent Receipts as Ex.PW-1/4 to Ex.PW-1/8.

16. On behalf of the Defendant, Sh. Roshan Lal, son and legal representative of Late Sh. Khem Chand, appeared as DW-1 and tendered his evidence by way of affidavit Ex.DW-1/A. DW-1 deposed that Late Sh. Khem Chand was a statutory tenant at a monthly rent of Rs.117/-, protected under the Delhi Rent Control Act, 1958. He re-affirmed the assertions made in the Written Statement that the permanent construction had been raised with the permission/licence of the Plaintiffs/predecessors.

17. Upon appreciation of the evidence, the learned Civil Judge concluded that the Suit Property was a vacant land at the inception of tenancy and, therefore, did not fall within the definition of “premises” under the Delhi Rent Control Act, 1958. Consequently, the bar under Section 50 of the said Act was held to be inapplicable. It was further held that the Defendant had failed to establish either the protection of statutory tenancy or the existence of any irrevocable licence under Section 60(b) of the Indian Easements Act, 1882.

18. It was accordingly, held that the tenancy of the Defendant stood validly terminated vide Notice dated 07.06.2005 and that the Defendant had no right to continue in possession of the Suit Property.

19. Consequently, the Suit was decreed for possession along with arrears of rent from 01.04.2004 till recovery of possession, vide Judgment and Decree dated 22.03.2023.

20. Aggrieved by the Judgment and Decree dated 22.03.2023, the Defendantpreferred a First Appeal under Section 96 read with Order XLI of CPC.

21. The challenge in the First Appeal was principally on the ground that the learned Trial Court failed to appreciate that the Defendant had not only asserted tenancy rights but had also, in the alternative, claimed protection as a licensee in respect of the Suit Property.

22. It was also contended that the learned Trial Court erred in holding that the Delhi Rent Control Act was not applicable, despite the rent receipts Ex.PW-1/D[1] and Ex.PW-1/D[2] describing the property as residential.

23. The learned First Appellate Court, upon re-appreciation of the record, affirmed the findings of the learned Trial Court that the nature of the property at the inception of tenancy is determinative for the applicability of the Delhi Rent Control Act, 1958. It was held that since the Suit Property was admittedly a vacant land at the time of letting, the subsequent construction raised thereon, would not bring the tenancy within the ambit of the Delhi Rent Control Act, 1958, and thus, the jurisdiction of the Civil Court was not barred.

24. The learned First Appellate Court further held that the Defendant had failed to produce any cogent evidence to establish the grant of licence, the nature and extent of construction, or the expenses incurred so as to attract Section 60(b) of the Indian Easements Act, 1882.

25. Therefore, it was concluded that the Defendant had failed to establish any legal right to continue in possession of the Suit Property after termination of tenancy. Accordingly, the First Appeal was dismissed vide Judgment dated 01.04.2026.

26. Aggrieved thereby, the present Regular Second Appeal under Section 100 of the Code of Civil Procedure, 1908 has been preferred by the Appellant.

27. The grounds of challenge are that the Judgments and Decrees passed by both the Courts below are illegal, arbitrary and unsustainable in law, having been rendered without proper appreciation of the facts and the settled legal principles applicable to the case.

28. It is stated that the Courts below have erred in holding that the tenancy in respect of the Suit Property was of vacant land and that its nature would not change due to subsequent construction raised thereon. The tenancy being a month-to-month tenancy, the nature of the demised premises stood altered upon construction of a residential structure, which fact stood reflected in the admitted rent receipts Ex. PW-1/D[1] and Ex. PW- 1/D[2] describing the premises as “residential”. The two Courts failed to draw the presumption under Section 114 of the Indian Evidence Act, 1872, from the admitted rent receipts.

29. It is further contended that once the Plaintiffs themselves admitted, through rent receipts, that the tenancy was in respect of residential premises and the admitted rent was below Rs.3,500/- per month, the bar under Section 50 of the Delhi Rent Control Act, 1958 squarely applied, thereby ousting the jurisdiction of the Civil Court.

30. It was submitted that the Courts below erred in rejecting the plea of licence, by incorrectly proceeding on the premise that the Defendant could either be a tenant or a licensee, whereas the case set up was that the Defendant, while being a tenant, had been granted permission to raise construction. It is contended that the Plaintiffs themselves admitted grant of permission to raise construction and, therefore, the existence of licence stood established and did not require independent documentary proof.

31. It is further submitted that the Defendant, having raised construction of a permanent nature with permission and having incurred expenses thereon, was entitled to protection under Section 60(b) of the Indian Easements Act, 1882, rendering the licence irrevocable.

32. It is asserted that the Courts below erred in holding that there was no evidence of permanent construction or expenditure, despite admissions in cross-examination regarding existence of structure on the Suit Property.

33. It is further contended that the learned First Appellate Court erred in observing, in the alternative, that even if a licence were assumed to have been granted, the same would not survive upon completion of the construction. Such reasoning is contrary to the scheme of Section 60(b) of the Indian Easements Act, 1882, whichrenders a licence irrevocable where the licensee, acting upon it, has executed a work of permanent character and incurred expenses, and that the reliance placed on principles governing extinguishment of licence, is misplaced.

34. Furthermore, it was contended that the Courts below erred in holding that no work of permanent character had been established, inasmuch as PW-1, in his cross-examination, admitted the existence of a structure on the Suit Property constructed using “kadi” and “silli”. Such admission was sufficient to establish that the Appellant had raised construction upon the Suit Property and, therefore, the requirements of Section 60(b) of the Indian Easements Act, 1882 stood satisfied.

35. The Appellant has proposed the following substantial questions of law:

(i) Whether the Suit of the plaintiffs/respondents herein was barred by

Section 50 of the Delhi Rent Control Act, 1958 in view of the admission regarding the tenancy being residential at a monthly rent of Rs.117/-?

(ii) Whether the licence granted to the defendant/tenant became irrevocable, as he was permitted to construct a residential house and had erected a permanent structure after incurring expenditure?

(iii) Whether the Suit ought to have been dismissed in view of the admissions made by PW-1 as regards the nature of tenancy and existence of licence?

(iv) Whether the erection of permanent structure at an expense stood proved from the fact that the assertion of DW-1 to such effect was not controverted during cross-examination?

(v) Whether the case law relied upon by the Courts below to decree the Suit is applicable in the facts of the present case? Submissions heard and record perused.

36. At the outset, it is to be noted that the scope of interference in a Regular Second Appeal under Section 100 of the Code of Civil Procedure, 1908 is confined to substantial questions of law. The concurrent findings of fact cannot be interfered with unless shown to be perverse or based on misapplication of law.

37. Though various substantial questions of law have been proposed, but the substantial questions that arises, are framed as under:

(i) Whether the Courts below have committed any error of law in holding that the tenancy in respect of the Suit Property, is not governed by the Delhi Rent Control Act, 1958; and

(ii) Whether the tenancy/Licence became irrevocable under Section

60(b) of the Indian Easements Act, 1882, on account of raising of construction, of permanent nature? I.Whether the tenancy was protected under S.50 Delhi Rent Control Act?

38. The primary contention of the Appellant is that once the construction was raised on the vacant land, the Suit Property had acquired the character of a residential premises and, therefore, the provisions of the Delhi Rent Control Act, 1958 were applicable, thereby ousting the jurisdiction of the Civil Court.

39. In the present case, there was a categorical admission of DW-1 in his cross-examination, that the Suit Property was an open land, at the inception of tenancy in the year 1955, and that construction was raised subsequently. Both the Courts below, have thus, correctly recorded that the Suit Property was a vacant land, at the time of its letting.

40. The Appellant relied on the rent receipts Ex.PW-1/D[1] and Ex.PW- 1/D[2], wherein the type of accommodation is described as “residential”, to contend that even the landlord recognized that the Suit Property was residential. The rent receipts Ex.PW-1/D[1] and Ex.PW-1/D[2], read as under:

41. A bare perusal of these rent receipts reflects that on the right, top side, above the type of accommodation, it was written „Plot/House Number‟, wherein House Number has been struck off, indicating that the tenancy premises pertains to a plot. Likewise, at the bottom left, it is written “premises/vacant land”, and again the term „premises‟ has been struck off, thereby indicating that the subject matter of the tenancy is vacant land admeasuring 75 sq. yards.

42. Upon a conjoint reading of the said receipts, it is evident that while the accommodation was described as “residential” in the top right corner of the rent receipts, but the same receipts described the suit property as vacant land,admeasuring 75 sq. yards,while the word “premises” stood struck off. It is absolutely clear from the Rent Receipts, that the nature of property was described as residential, but what was let out, was a vacant plot of land. In this view, it was rightly held by the two courts that the Rent Receipts fully established that the suit property that was let out was vacant plot and not a residential accommodation.

43. The learned First Appellate Court, while affirming the aforesaid finding, held that the nature of the property at the inception of tenancy, is determinative for the applicability of the Delhi Rent Control Act, 1958, and that subsequent construction or description in documents, including the rent receipts, would not alter such character. The contention that a presumption ought to have been drawn under Section 114 of the Indian Evidence Act, 1872 was, therefore, rightly rejected.

44. In these circumstances, no error of law can be found in the conclusion of the Courts below, that the provisions of the Delhi Rent Control Act, 1958 are not applicable and that the jurisdiction of the Civil Court is not barred. II.Whether the Appellant had Irrevocable Licence under Section 60(b) of the Indian Easements Act, 1882, on Account of raising of construction?

45. At the outset, it is pertinent to note that the present case is essentially founded on a relationship of landlord and tenant. The rights and obligations arising from a tenancy/lease are governed by the provisions of the Transfer of Property Act, 1882 and, where applicable, by the provisions of the Delhi Rent Control Act, 1958.

46. Section 105 of the Transfer of Property Act, 1882 defines a lease as a transfer of a right to enjoy immovable property for a certain time, in consideration of a price paid or promised. A tenancy, therefore, creates an interest in immovable property in favour of the tenant.

47. The incidents of such tenancy are further reflected in Section 108 of the Transfer of Property Act, 1882, which enumerates the rights and liabilities of the lessor and lessee. In particular, Section 108(p) obligates the lessee not to erect any permanent structure upon the leased property except for agricultural purposes, unless otherwise contractually permitted. Section 108(h) further recognises the lessee‟s limited right, during continuance of the lease, to remove things attached to the earth by him. Thus, the law governing leases itself contemplates the rights and limitations concerning constructions raised by a tenant upon the tenanted property.

48. A licence, on the other hand, is governed by the provisions of the Indian Easements Act, 1882. Section 52 of the Indian Easements Act, 1882 defines a licence as under:

49. Section 60(b) of the Indian Easements Act, 1882 provides that a licence may become irrevocable where the licensee, acting upon the licence, has executed a work of a permanent character and incurred expenses in the execution thereof.

50. The Supreme Court in Associated Hotels of India Ltd. v. R.N. Kapoor, AIR 1959 SC 1262, explained the distinction between a lease and a licence and held that a lease creates an interest in the property, whereas a licence merely confers a personal privilege to use the property without creating any legal interest therein. The said distinction was reiterated in Delta International Ltd. v. Shyam Sundar Ganeriwalla, (1999) 4 SCC 545, wherein the Supreme Court held that a licence merely permits permissive use of property and creates no proprietary interest therein.

51. Thus, the concepts of tenancy and licence occupy distinct fields and operate in different legal orbits. The rights flowing from a tenancy are governed by the law relating to leases and rent control, whereas the doctrine of irrevocable licence embodied in Section 60(b) of the Indian Easements Act, 1882 operates in the realm of licences. Mere existence of tenancy, or mere raising of construction by a tenant, would not ipso facto attract Section 60(b) of the Indian Easements Act, 1882, unless an independent licence to raise such construction and the ingredients contemplated under Section 60(b) are specifically established which is not so, in the present case. The Appellant has claimed his license had become irrevocable but this contention is self-defeating since there was no license ever created nor was it ever claimed by the Appellant.

52. However, since the Appellant has specifically invoked Section 60(b) of the Indian Easements Act, 1882 by contending that permission/licence had been granted to raise construction on the Suit Property and that such licence became irrevocable upon raising construction of permanent nature, the said plea is being examined.

53. The contention of the Appellant is that he was granted a licence to raise construction on the Suit Property and, having executed work of a permanent character, such licence became irrevocable under Section 60(b) of the Indian Easements Act, 1882.

54. Section 60(b)of the Indian Easements Act, 1882reads as under:

55. For invoking Section 60(b), the licensee must cumulatively establish three conditions:

(i) firstly, the licensee must have executed a work of a permanent character on the property;

(ii) secondly, such work must have been executed “acting upon the licence”, that is, pursuant to and within the scope of the permission granted, and with the knowledge and consent of the licensor; and

(iii) thirdly, the licensee must have incurred expenses in the execution of such work. The absence of any one of these conditions is fatal to the plea of irrevocability.

56. Section 60(b), being in the nature of a statutory exception to the general rule that a licence is revocable, must be strictly construed, and the burden squarely lies on the licensee to establish its applicability.

57. The scope of the expression “acting upon the licence” has been authoritatively explained in Shankar Gopinath Apte v. GangabaiHariharrao Patwardhan, (1976) 4 SCC 112, wherein it was held that even if permanent construction is raised, the protection of Section 60(b) would not be available unless such construction is executed in the capacity of a licensee and in furtherance of the licence itself.

58. Similarly, in Ram Sarup Gupta v. Bishun Narain Inter College, 1987 SCC OnLine SC 189, it was emphasised that the construction must be directly referable to the licence and undertaken in furtherance of the very purpose for which the licence was granted.

59. The Supreme Court in Mumbai International Airport Pvt Ltd v. Golden Chariot Airport, (2010) 10 SCC 422, has further clarified that mere expenditure or construction, even if substantial, does not by itself render a licence irrevocable, unless it is shown to be authorised and carried out in pursuance of the licence.

60. In the present case, no documentary evidence of licence was produced and the consistent testimony of PW-1 is that tenancy was created in respect of vacant land, which is also corroborated by the various rent receipts.

61. PW-1/Sh. Naveen Verma, Plaintiff No.2, in his testimony deposed that Appellant/tenant was inducted on a vacant plot of land. He further admitted that Defendant had raised structure on the Suit Property, but claimed it to be temporary structure built of „kadi‟&„silli‟. It was denied that permanent structure is existing, since 1990.

62. Defendant in his testimony as DW-1, had deposed that his father had taken the Suit Premises on rent from Sh. Chandramal and acting upon the licence, he executed a work of permanent character, for which he incurred expenses and therefore, he cannot be evicted. He further deposed that Plaintiff was aware that the nature of tenancy was of built-up premises and the rent receipts also reflected the premises as residential.

63. First and foremost, it has already been noted above that the type of premises was being reflected as residential, but consistently, at every place, it was indicated that the tenancy was in respect of the vacant plot.

64. Furthermore, Defendant in his cross-examination has admitted that the Suit Premises was an open land, at the time it was taken on rent. He volunteered that the Suit Premises got constructed by his father, after taking permission from the landlord, after around two months.

65. Had so been the case, there was no reason for the nature of tenanted premises being described as vacant plot in the rent receipts. Moreover, he admitted that permission was not taken in writing and was oral, based on mutual understanding. Another revealing admission by DW-1 is that when he told his counsel that he had taken the land and raised construction on it after about 1.[5] months, he was informed that tenancy is protected under Delhi Rent Control Act.

66. It is significant to observe that while Appellant had asserted that he, after taking property and vacant land, had raised permanent construction on the Suit Property. However, it has been explained by the Plaintiff in his testimony that it was only a temporary structure of „kadi‟&„silli‟ that was raised. No further cross-examination was conducted, nor was any counterevidence produced by the Appellant.

67. It is evident that the construction raised by„kadi‟&„silli‟ is essentially temporary in nature. Even otherwise, if it is assumed to be of a somewhat permanent nature, there is nothing adduced in the evidence to show that construction was carried out under the licence or it was raised by permission of the Respondent/landlord, which is an essential component of creating an irrevocable licence under Section 60(b) of the Easements Act.

68. To conclude, no documentary evidence of licence was produced; the alleged permission is stated to be oral by DW-1 and remained vague; and no material particulars regarding the nature of construction or the expenditure incurred were proved. Even the date and circumstances in which the construction was allegedly raised were not established with certainty, nor was any cogent evidence led to prove the expenditure allegedly incurred.

69. The contention of the Appellant that the existence of a structure on the Suit Property, as admitted in the cross-examination of PW-1, establishes execution of a work of permanent character, is misconceived. The mere existence of a structure, does not ipso facto satisfy the requirement of Section 60(b) of the Indian Easements Act, 1882, which mandates proof of a work of permanent character executed upon the licence and expenditure incurred in that regard.

70. Significantly, PW-1, while acknowledging the existence of a structure, expressly clarified that there was no permission under the tenancy, to raise the construction; the essential ingredients of Section 60(b) remain unfulfilled. On the contrary, the evidence on record, including the rent receipts Ex.PW-1/4 to Ex.PW-1/8, does not establish any independent licence to raise permanent construction so as to render the occupation irrevocable.

71. The contention that such licence stood admitted in the testimony of PW-1 is untenable as no clear or unequivocal admission satisfying the requirements of S.60(b) emerges from the record. In the absence of proof that the construction was undertaken while acting upon the licence, the Appellant cannot derive any benefit under S.60(b) of easement Act.

72. In view of the above, the Appellant has failed to discharge the burden of establishing the essential ingredients of Section 60(b). The findings recorded by the Courts below in this regard, are findings of fact based on appreciation of evidence and do not disclose any perversity or misapplication of law, warranting interference under Section 100 CPC.

73. Both the Courts below have concurrently found that the Appellant failed to establish the grant of any such licence or that the construction was carried out under the terms of licence and that the construction was of a permanent nature, as mandated under law. Conclusion:

74. In view of the aforesaid discussion, it is held that both the Courts have rightly decreed the Suit for Possession and Arrears of Rent. There is no substantial question of law raised for consideration, in the present Appeal.

75. Accordingly, the Appeal along with pending Applications, if any, also stands dismissed.

NEENA BANSAL KRISHNA, J APRIL 20, 2026