TMI Blog2003 (11) TMI 617X X X X Extracts X X X X X X X X Extracts X X X X ..... her term of 50 years and on such option being exercised before the expiry of term of 50 years of the existing lease, the lessor shall act upon forthwith and execute and deliver to the lessee upon his duly executing a counter part or renew the lease for the said premises for a further term of 50 years and with and subject to the same covenants conditions and provisions as are herein contained. The original deed of lease though very material for ascertaining the covenants thereof, including the one for renewal, has not been placed on record by either party. The High Court has in its impugned judgment observed that the suit property has changed hands but the document is certainly available with the State-appellant, and in the facts and circumstances of the case, the State ought to have produced the lease or its copy to assist the Court in arriving at a just decision, but the same was not done in spite of several opportunities having been allowed for the purpose and though the State had filed a counter-affidavit followed by two supplementary-affidavits. The High Court has chosen to draw an adverse inference against the State without expressly stating so, as its observation indicat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d been herein repeated in full with such modifications only as are necessary to make them applicable to this demise and as if the name of the parties hereto had been substituted for those in the aforesaid lease provided always that the building referred to in the aforesaid lease having been erected the lessee shall not be under any obligation to erect another. (underlining by us) Proceeding on an assumption (the correctness whereof is the core of the controversy and shall be dealt with shortly hereinafter) that the renewed lease incorporated all the covenants of the original lease including the covenant for renewal, the respondent sought for renewal of the lease for yet another term of 50 years. The Collector of the District recommended renewal. The Board of Revenue also directed the renewal to be expedited. The Government had also issued instructions to all the Commissioners and District Magistrates generally directing them to renew such like leases. However, the State Government set over the renewal which led to the respondent filing a writ petition in the High Court of Allahabad which was disposed of at the admission stage itself by order dated 19.4.1989. The Division Bench ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 991 raising yet another plea that the respondent was negotiating the sale of the leased land without prior sanction of the State Government which was in violation of the terms of the lease deed and so also the respondent was not entitled for any further renewal. In the decision dated 19.4.1989 referred to hereinabove, the High Court had made a reference to the case of Purshottam Das Tandon Ors. and expected the State of U.P. to endeavour to renew the lease of the respondent herein in accordance with the aforesaid judgment as soon as possible. It seems that Purshottam Das Tandon was holding lease of the land owned by the State on similar terms as was held by the respondent herein, excepting for the difference that the land held by Purshottam Das Tandon was nazul land while the land held by the respondent herein is government estate. Though this difference was pointed out at the time of hearing, however the learned counsel for the appellant State of U.P. was unable to point out what difference it makes so far as the case for renewal is concerned if the covenants in the lease deeds held by Purshottam Das Tandon and the respondent herein respectively were identical. The decision o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssor is unnecessary. (Baker v. Merckel (1960) 1 All ER 668, also Mulla, ibid, p.1204). Where the principal lease executed between the parties containing a covenant for renewal, is renewed in accordance with the said covenant, whether the renewed lease shall also contain similar clause for renewal depends on the facts and circumstances of each case regard being had to the intention of the parties as displayed in the original covenant for renewal and the surrounding circumstances. There is a difference between an extension of lease in accordance with the covenant in that regard contained in the principal lease and renewal of lease, again in accordance with the covenant for renewal contained in the original lease. In the case of extension it is not necessary to have a fresh deed of lease executed; as the extension of lease for the term agreed upon shall be a necessary consequence of the clause for extension. However, option for renewal consistently with the covenant for renewal has to be exercised consistently with the terms thereof and, if exercised, a fresh deed of lease shall have to be executed between the parties. Failing the execution of a fresh deed of lease, another lease for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... age is clear and unambiguous. Another illuminating decision on the point is by Sir Ashutosh Mookerjee, J., speaking for the Division Bench of Calcutta High Court in Secretary of State for India in Council Vs. A.H. Forbes, (1912) 17 IC 180. The Division Bench on a review of several English decisions held:- (1) A lease, which creates a tenancy for a term of years, may yet confer on the lessee an option of renewal. (2) If the lease does not state by whom the option is exercisable, it is exercisable (as between the lessor and lessee) by the lessee only, that is to say, a covenant for renewal, if informally expressed, is enforced only in favour of the lessee. (3) The option is exercisable not merely by the lessee personally but also by his representative-in-interest. (4) If the option does not state the terms of renewal, the new lease will be for the same period and on the same terms as the original lease, in respect of all the essential conditions thereof, except as to the covenant for renewal itself. (5) There is no sort of legal presumption against a right of perpetual renewal. The burden of strict proof is imposed upon a person claiming such a right. It should not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Upon that footing, in the events which have happened, all the landlord was bound to do under this arrangement was to permit the tenant to occupy for a period not exceeding 18 months in the whole from the time when the original lease was granted. We find ourselves in full agreement with the view of the law taken in the decisions cited hereinabove. It is pertinent to note that the respondent is not claiming a lease in perpetuity or right to successive renewals under the covenant for renewal contained in the 1887 lease. The term of 50 years under the 1887 lease came to an end in the year 1937 and the option for renewal was exercised by the respondent as assignee of the original lessee which exercise was honoured by the lessor State executing a fresh deed of lease belatedly on February 20, 1945. This lease deed does not set out any fresh covenants, mutually agreed upon between the parties for the purpose of renewal. Rather it incorporates, without any reservation, all the covenants, provisos and stipulations as contained in the principal lease as if they had been herein repeated in full. Not only was a fresh deed of lease executed but the conduct of the parties also shows that at ..... X X X X Extracts X X X X X X X X Extracts X X X X
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