If leasehold premises is destroyed lease get terminated?

IN THE HIGH COURT OF KERALA AT ERNAKULAM

PRESENT:MR. JUSTICE K.RAMAKRISHNAN
1ST DAYOF AUGUST 2016.

CRP.No. 139 of 2016

MOHANDAS K.B.,
SYAMALA,
Citation: AIR 2017 (NOC)1 Ker

1.The above revision has been filed against the order, dismissing E.P.No.23/2015 in O.S.No.159/1994 on the file of the Munisff Court, Mannarkkad. The suit was filed by the predecessor of the revision petitioners as O.S.No.159/1994 for recovery of possession of the building which was let out to the predecessor of the respondents. The building is situated in an area where the provisions of Rent Control Act is not extended. The suit was decreed as per Annexure A-1 Decree and it was confirmed in A.S.No.24/2002 on the file of the Sub Court, Ottapalam. The original plaintiff died during the pendency of the appeal and the present petitioners have been impleaded as additional respondents in the appeal as his legal heirs and the appeal was also dismissed. The    present   petitioners  filed E.P.No.23/2015    for executing the decree which was dismissed by the court below on the ground that the subject matter of the suit is destroyed and delivery could not be effected. This is being challenged by the revision petitioners before this Court.

2.Though notice was served on the respondents, they did not appear.

3.Heard Shri.C.P.Peethambaran, the learned counsel for the revision petitioners.

4. The counsel for the revision petitioners submitted that the dismissal of the Execution Petition as not executable due to destruction of the building is unsustainable in law as the court below ought to have delivered the property in which the building existed. He had relied on the     decisions   reported   in    Kandaru     Veettil Ramakrishnan’s Son Preman Vs. Kadaruveettil Ramakrishnan’s Son Gopi [ILR 2016 (1) KER 746], Shaha Ratansi Khimji Vs. Proposed Kumbhar Sons Hotel Pvt. Ltd.[2014 (3) KLT 1014 (SC)] and Kalpakam Amma Vs. Muthurama Iyer [1994 (2) KLT 424].

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5.The fact that the suit was filed by the predecessor of the revision petitioners for eviction of the building from the possession of the predecessor of the respondents as O.S.No.159/1994 on the file of the Munsiff Court, Mannarkad and that was decreed and appeal filed against the same was also dismissed, is not in dispute. It is also an admitted fact that the revision petitioners filed E.P.No.23/2015 for execution of the decree, as the original plaintiff died during the pendency of the appeal and    the     present    revision   petitioners      have been impleaded as his legal heirs in that appeal.

6.The court below dismissed the Execution Petition by the impugned order which reads as follows:

“Heard. As per the decree, the plaint schedule
property was ordered to be evicted Plaint schedule
property is the building premise.     Amin reported
that the building shown in the decree schedule is
not in existence and not seen. Since the subject
matter of the suit is destroyed, E.P. is dismissed.”

7. In the decision reported in Kalpakam Amma Vs. Muthurama Iyer [1994 (2) KLT 424], it has been held that when there is a lease of a building, such lease   would normally take in the site unless it is specifically   excluded.

It is also stated in the decision that   destruction of the building does not automatically   terminate the lease and put an end to landlord-tenant   relationship. Since there were conflicting decisions on the question as to whether on the destruction of the subject matter of the lease, whether the lease will come to end, it was referred to a larger Bench of the Apex Court and the Three Judges Bench of the Apex Court in Shaha Ratansi Khimji Vs. Proposed Kumbhar Sons Hotel Pvt.Ltd. [2014 (3)KLT 1014 (SC)] held that once the right of lease is transferred in favour of the   lessee, the destruction of a building constructed on the   lease property does not determine the tenancy rights of   occupant which is incidental to the contract of lease   which continues to exist between them.     The Supreme Court     has     over ruled  the decision  reported   in Vannattankandy Ibrayi Vs. Kunhabdulla Hajee [2001 (1) SCC 564] and approved the dictum laid down in the decision reported in T. Lakshmipathi and Others Vs. P.Nithyananda Reddy and Others [2003 (5) SCC 150], where it has been held that the lease of the building includes the land on which the building stands.

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So, even if the building is destroyed or demolished, the lease is not determined as long as the land beneath it continues to exist.

The doctrine of frustration cannot be invoked on destruction or demolition of building under lease where not only privity of contract, but, privity of estate is also created. In the same decision, it has been held that, unless the lease has been terminated, merely because the structure has been destroyed will not terminate the lease entitled to the landlord to take possession without recourse to law. So, the tenancy will have to be terminated and in such cases, the landlord is entitled to file a civil suit for recovery of possession.

The same view has been reiterated in the latest decision reported in Preman Vs. Gopi [I.L.R. 2016 (1) Kerala 746]. So, merely because the subject matter of the suit (namely, the building) has been destroyed is not a ground for dismissing the Execution Petition. In this case, instead of the Rent Control Petition, the suit has been filed by the landlord after terminating the lease by issuing notice under Section 106 of Transfer of Property Act. So, in such cases, in view of the principles laid down in the above decisions, even if the building is destroyed, the landlord is entitled to recover the land in which the building existed. So, the court below was not justified in dismissing the application on the ground of destruction of the building which is the subject matter of the lease. The court below ought to have identified the property in which the building existed and effected delivery of the same to the decree holder.

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So, the order dismissing the Execution Petition is set aside and the matter is remitted to the court below for fresh disposal in accordance with law as stated above.

Sd/-
K.Ramakrishnan,
Judge.

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