Licence and Irrevocable Licence: Section 60 Easements Act Applies only to ‘Bare Licences’ and Not to ‘Contractual Licences’

Saji Koduvath, Advocate, Kottayam.

Abstract

The provisions relating to ‘Licence’ are not logically legislated. It lacks doctrinal coherence and legal consistency.

‘Licence’ is defined ‘exhaustively’ in Sec. 52.
But the word ‘licence’ is used in the words ‘contractual licence’ in Sec. 64 unconnected to the meaning in Sec. 52. In the same way, the words ‘licence coupled with a transfer of property’ in Sec. 60(a) also connote a different meaning altogether different from the definition in Sec. 52.

The criticism is that it should have made clear in Sec. 52 itself that the definition is not exhaustive, with the usual words in the statutes – ‘unless the context otherwise requires’.

Introduction 

Sec. 52 of the Indian Easements Act, 1882 defines ‘Licence’ as under:

52. “License” defined – Where one person grants to another, or to a definite number of other persons, a right to do, or continue to do, in or upon the immovable property of the grantor, something which would, in the absence of such right, be unlawful, and such right does not amount to an easement or an interest in the property, the right is called a license.
  • Note: In British English, “Licence” is a noun and “license” is a verb. In the United States, “license” is used as both a noun and a verb. Indian statues prefer to follow the US practice (license). “Licence” (UK noun form) is often preferred in legal writing and formal opinions.

Revocation of Licence and Grant  

Section 60 of the Indian Easements Act, 1882 reads as under:

“60. License when revocable – A license may be revoked by the grantor, unless-
       (a). It is coupled with a transfer of property and such transfer is in force;
       (b). The licensee, acting upon the license, has executed a work of a permanent character and incurred expenses in the execution.

Part I – What is ‘Licence’ in Sec. 52, Easements Act?

Sec. 52 Licence is only a ‘bare’ and ‘personal’ right, Not an ‘Interest’ in ‘Property’

In Sec. 52 itself it is stated:

  • “such right does not amount to an easement or an interest in the property”.

‘Licence’ in Sec. 52 is only a ‘bare‘ and ‘personal‘ right, related to an immovable property.

It is made clear by the following words –  

  • “one person grants to another”
  • ‘a right to do, or continue to do’
  • something which would, in the absence of such right, be unlawful.

Kinds of Licenses

The Easements Act itself mentions several kinds of licences –

  • (i) licence (bare or gratuitous) in Sec. 52;
  • (ii) contractual licence in Sec. 64;
  • (iii) licence coupled with ‘a transfer of property’ in Sec. 60(a).

Licence in S. 52 is worded to ‘contra-distinct’ Contractual Licence

S. 52 canvases a bare (‘contra-distinct’ to contractual) licence from the words –

  • “something which would, in the absence of such right, be unlawful”. 
  • It is the most operative and pivotal expression in Sec. 52.

For S. 52 Licence, the act must “Otherwise be Unlawful“; It must Not be Contractual

The ‘act’ envisaged under S. 52 Licence is one that must be – otherwise ‘Unlawful’.

Example:

  • Gratuitous permission for parking a car in the courtyard of a house.

Another (possible) ‘lawful’ means is –

  • Pay-and-park arrangement (express contractual licence). Implied contract if employee parks his vehicle in the employer’s compound.

The contractual parking is authoritative and ‘lawful’. It will not amount to a trespass.

In the former, if the claimant fails to show the licence, he would be a trespasser.

In Harshadkumar Sundarlal Dalal v. Hasmukhben, 1983 GLH 774; 1983-1 GLR 383, it was pointed out as under:

  • “The licensee has no right or interest in the immovable property and he has merely a personal right by which what would otherwise be an act of trespass is converted into a lawful action.”

In Black’s Law Dictionary, 8th Edition (South Asian Edition), page 938, the definition of “licence” is given as under:

  • “License: A permission, usu. revocable, to commit some act that would otherwise be unlawful: esp.: an agreement (not amounting to a lease or profit, a prendre) that it is lawful for the licensee to enter the licensor’s land to do some act that would otherwise be illegal, such as hunting game.” (Quoted in: Sunrise Stone Crusher Pvt. Ltd. v. State of U. P., 2020-1 AllLJ 210)

“Acting Upon The Licence” and Re-construction of a building

No possession in licence.

“Acting Upon The Licence” (without possession), it is not possible to dismantle a structure.

Licence is only a right to do something, which would, in its absence, unlawful.

  • For re-construction, possession (interest) must have given.
  • If it is so, in case of re-construction – there will be no application of S. 52 and 60(b).
  • But it is possible (as seen from Sec. 60-b) when a construction is made on a bare land.

A Legal Criticism

  • The provisions relating to ‘Licence’ are not logically legislated. It lacks doctrinal coherence and legal consistency.
  • ‘Licence’ is defined ‘exhaustively’ in Sec. 52. But the word ‘licence’ is used in the words ‘contractual licence’ in Sec. 64 unconnected to the meaning in Sec. 52. In the same way, the words ‘licence coupled with a transfer of property’ in Sec. 60(a) also connote a different meaning altogether to the definition in Sec. 52. (The criticism is that it should have made clear in Sec. 52 itself that the definition is not exhaustive, with the usual words in the statutes – ‘unless the context otherwise requires’).

Sec. 60(b) is not attracted to Contractual Licences

  • R. P.  Shrivastava v. Sheela Devi, 2008-2 CivLJ 288; 2007-4 MPLJ 102 (Arun Misra, J.)
  • Mumbai International Airport Pvt.  Ltd.  v. Golden Chariot Airport, 2010-10 SCC 422

Sec. 60(b) Easement Act applies to a purely personal or gratuitous licence that falls under Sec. 52. It is clear from R. P.  Shrivastava v. Sheela Devi, 2008-2 CivLJ 288; 2007-4 MPLJ 102 (Arun Misra, J.) that it does not apply to contractual licences.

  • “13. A mere licence does not create any estate or interest in the property to which it relates. It only confers legality on an act which would otherwise become unlawful. A licence may be
    • purely personal,
    • gratuitous or
    • contractual.
  • The first two classes of mere licenses are revocable, the third class is revocable or not revocable according to the express or implied terms of the contract between the parties.
  • A license coupled with grant of an interest in nature of property is not revocable.”

Concept of Part Transfer to the licenses is Unknown u/s. 60
 In Dharamvir Khosla v. Asian Hotels (North) Ltd., 2020 Supreme (Del) 738, it is held as under:

  • “14. Since in terms of Section 60 clause (b) of the Easement Act the plaintiff, i.e. licensee, has, acting upon the license, executed a work of permanent character and has incurred expenses thereon, the license has to be interpreted as a irrevocable one. When the transfer of license in respect of shop U-63 was done, the only transfer charges taken by the defendant were Rs. 25,800/- whereas the plaintiff received a full consideration minus the consideration of the loft area. Since the defendant permitted part transfer of the licenses which concept is unknown under Section 60, it is evident that the intention of the parties was of creating irrevocable license.”

Bare Licence u/S. 52 is ‘Personal Privilege’

Division Bench of the Delhi High Court in Chandu Lal v. Municipal Corporation of Delhi, AIR 1978 Del 174, distinguished easement and licence as under:

  • “26… A mere licensee has only a right to use the property. Such a right does not amount to an easement or an interest in the property but is only a personal privilege to the licensee. ……..”

Contract must be Enforced by Injunction, Not by Invoking Sec. 60

In Dominion of India v. R.B. Sohan Lal, AIR 1950 P&H 40, it was found that a contractual provision that made an irrevocable licence had to be protected by enforcing the contract, by an injunction “restraining the breach of the implied negative covenant”, and not by invoking the pleading of Sec. 60. It was held as under:

  • “I would be inclined to hold, if that clause stood alone, that the parties by their special contract made the license, which was prima facie revocable under S. 60, an irrevocable license and that a threatened revocation thereof should be enforced by an injunction restraining the breach of the implied negative covenant.”

Definitions of Licence

Black’s Law Dictionary

  • In Black’s Law Dictionary, Seventh Edition, the word “licence” means “a revocable permission to commit some act that would otherwise be unlawful” and the word “licensee” means “one to whom a licence is granted or one who has permission to enter or use another’s premises, but only for one’s own purposes and not for the occupier’s benefit.” 

Stroud’s Judicial Dictionary of Words and Phrases

  • Stroud’s Judicial Dictionary of Words and Phrases, Sixth Edition, Vol. 2, provides the meaning of word “licensee” to mean “a licensee is a person who has permission to do an act which without such permission would be unlawful. [See Vaughan C.J., in Thomas v. Sewell Vaugh at page 330 at page 351, quoted by Romour, J, in Frank Warr and Co. v. London County Council (1940) 1 K.B. 713.”

Barron’s Law Dictionary

  • Barron’s Law Dictionary has given the meaning of word “licensee” to mean “the one to whom a licence has been granted; in property, one whose presence on the premises is not invited but tolerated. Thus, a licensee is a person who is neither a customer, nor a servant, nor a trespasser, and does not stand in any contractual relation with the owner of the premises, and who is permitted expressly or impliedly to go thereon usually for his own interest, convenience, or gratification”.

Puran Singh Sahani v. Sundari Bhagwandas Kriplani, 1991-1 SCR 592

  •  “44. ….. A “licence” is a power or authority to do some act, which, without such authority, could not lawfully be done. In the context of an immovable property a “licence” is an authority to do an act which would otherwise be a trespass. It passes no interest, and does not amount to a demise, nor does it give the licensee an exclusive right to use the property. 

All these definitions are quoted by the Bombay High Court in Prabhudas Damodar Kotecha v. Manharbala Jeram Damodar,  2007-5 MHLJ 341 (Upheld by the Supreme Court in: Prabhudas Damodar Kotecha v. Manharbala Jeram Dmodar, AIR 2013 SC 2959, 2013-15 SCC 358). 

Kinds of Licences

Licence may be Personal or Contractual

In Pradeep Oil Corporation v. Municipal Corporation of Delhi, AIR 2011 SC 1869; 2011-5 SCC 270, it is held as under:

  • “A licence may be created on deal or parole and it would be revocable. However, when it is accompanied with grant it becomes irrevocable. A mere licence does not create interest in the property to which it relates. Licence may be 
    • personal or 
    • contractual. 
  • A licensee without the grant creates a right in the licensor to enter into a land and enjoy it. 

Bare Licence Defined under Sec. 52 Easements Act:

  • As stated above, Sec. 52, Easements Act presents a ‘bare licence’, and it does not refer to a contract with mutual and reciprocal promises. It primarily deals with gratuitous licences. 

Contractual Licences: 

  • Modern commercial licences—such as those related to hotel stays, telecom services, software usage, and similar arrangements—are typically contractual in nature, involving mutual and reciprocal obligations between the parties. Unlike traditional unilateral licences, these Contractual Licences are governed by the terms of an agreement and may include rights, duties, and considerations enforceable under contract law. While such licences do not fall within the ambit of Section 52 of the Indian Easements Act. 

Oral Licence

  • A Licence may be oral also. In such a case, terms, conditions and the nature of the Licence, has to be gathered from the purpose for which it is licenced, coupled with the conduct of the parties and the circumstances which may have led to the grant of the Licence (Ram Sarup Gupta v. Bishun Narain Inter College, AIR 1987  SC 1242; 1987-2 SCC 555).

‘Contractual Licence’ Differs from a Bare Licence u/S. 52   

In Mumbai International Airport Pvt.  Ltd.  v. Golden Chariot Airport, 2010-10 SCC 422, it is observed as under: 

  • “A licence can be –
    • purely personal,
    • gratuitous or 
    • contractual. 
  • Whether a contractual licence is revocable or not, would obviously depend on the express terms of the contract.”

A licence created by a contract is known as ‘contractual licence’. It differs from a bare licence under Sec. 52 Easements Act on the following counts -.

  • One of the essential essence of a licence is that it is revocable; but, the terms of the contractual licence determines its revocation.
  • Sec. 52 serves to legalise “something which would, in the absence of such right be unlawful”.  Contractual licence is legally recognised under the Contract Act. (For example, gratuitous-permission of using a room in a residential house and contra-distinct to a ‘homestay’ – with consideration).

Characteristics of Contractual Licence

Following are the characteristics of contractual licence –

  • Its enforcement is governed under the Indian Contract Act, and not under the Easements Act.
  • In contractual licence, the terms of the licence will be the decisive factor; and not thye sweet will of the grantor.
  • What matters most in contractual licence is the substance of the arrangement, not its form or label.

In Vishwanath Sawant v. Gandabhai Kikabhai, 1990-2 BomCR 406; 1990 MhLJ 1145; 1990-1 MhLJ 1145, it was observed as under:

  • “A licence may be of two kinds, namely, a bare licence which is purely a matter of personal privilege and a licence coupled with a grant or interest. …. A licence may be purely personal, gratuitous or contractual. The first two classes are of mere licences which are revocable, the third class, whether is recoverable or not would depend upon the express or implied terms of the contract between the parties. 
    • (Quoted in: Francis v. Andrew, 2008-6 MhLJ 450; 
    • Adi S. Mehta v. Adil G. Illava, AIR 1998 Bom 107; 
  • Also See:
    • RP  Shrivastava v. Sheela Devi, 2008-2 CivLJ 288; 2007-4 MPLJ 102 (Arun Misra, J.). 
    • Mumbai International Airport Private Limited v. Golden Chariot Airport, 2010-10 SCC 422)

Halsbury’s Laws of England 4th Edition, Volume 9, paragraph 530 it is stated as follows:

  • “A contractual licence is a licence supported by consideration but not coupled with a grant. Such a licence might at common law be effectively of revoked at any time, whether or not it contained provisions regarding its duration and the licensee’s only remedy was an action for damages; but the equitable principle now prevails, and if on its proper construction the licence is irrevocable or revocable only after a certain time, revocation will as a rule be restrained by the grant of an injunction. Where the remedy of injunction cannot be applied because the licence has already been ejected, it seems that the Court will determine the parties’ rights on the basis of what they would have been if there had been an opportunity to apply for an injunction.” (quoted in: Base International Holdings N. V. Hockenrode v. Pallava Hotels Corporation Limited, 1999 2 ArbLR 433; 1999 19 PTC 252 (Mad).

Difference: ‘Bare Licence’ and ‘Contractual Licence’ – on Revocability

The difference between a Bare Licence and ‘Contractual Licence’ can be deciphered from M.N. Clubwala v. Fida Hussain, AIR 1965 SC 610, where our Apex Court has pointed out as under:

  •  “While it is true that the essence of a licence is that it is revocable at the will of the grantor, the provision in the licence that the licensee would be entitled to a notice before being required to vacate is not inconsistent with the licence. In England it has been held that a contractual licence may be revocable or irrevocable according to the express of implied terms of the contract between the parties.” Quoted in: Delta International LTD.  v. Shyam Sundar Ganeriwalla, AIR 1999 SC 2607; 1999 4 SCC 545).

Bare Licence u/S. 52  Does Not Create Contractual Obligations

The following legal propositions arise from Sec. 52 of the Easements Act –  

  • 1. A bare licence under Sec. 52 of the Easements Act is a unilateral permission. It does not arise from mutual or reciprocal promises, and does not create contractual obligations. It is typically gratuitous, revocable, and does not confer any interest in the (immovable) property.
  • 2. If a document titled ‘licence’ is entered into by a lawful owner or authority as ‘licensor’, but its terms confer a vested proprietary right (such as exclusive possession or interest in the property), then the arrangement will not be a (bare) licence under Sec. 52 of the Easements Act; and instead, it will be construed as a lease, contractual-licence etc. as the case may be.
  • 3. However, if the arrangement only permits the licencee to do something on the property that would otherwise be unlawful (e.g., gratuitously occupy a room in a house, erect a stall without transferring an interest in the land), then the test under Sec. 52 — “something which would, in the absence of such right, be unlawful” — is satisfied, and the arrangement is characterised as a licence.  
  • 4. Even if there is on a (prior) contract, express or implied (as in the former example – to occupy a room in a house) what matters is the terms of the licence; and not the ‘prior’ contract.
  • 5. Though the words: “something which would, in the absence of such right be unlawful” may appear to be applicable to both contract and licence, the catching words, “something which would” make it sufficiently clear that it is intended to exclude all other lawful right or permission such as lease, mortgage, contract that creates a vested right etc.  Otherwise, these words would stand redundant or mere surplusage.
  • 6. The “permission” granted in a licence should ‘legitimise’ an act (otherwise, it should stand unlawful or trespass). 

Bare Licence u/S. 52 – No Mutual Promise; It must be Unilateral 

In Ramesh Dwarkadas Mehra v. Indravati Dwarkadas Mehra (B.N. Srikrishna, Smt. Ranjana Desai, JJ.), 2001 AIR (Bom) 470; 2001-4 BomCR 417; 2001-4 BomLR 102; 2001-4 MhLJ 483, it is held as under:

  • “Section 52 does not require any consideration, material or non-material, to be an element of the definition of licence, nor does it require that the right under the licence must arise by way of contract or as a result of mutual promises. Thus, ” licence” as defined in section 52 of the Indian Easements Act, 1882 can be a unilateral grant and unsupported by any consideration. This is also the view taken by the Supreme Court in State of Punjab v. Brig. Sukhjit Singh, 1993(3) S.C.C. 459 (vide paragraph 30) where it observes that – 
  • “payment of licence fees is not an essential attribute for the subsistence of the licence”.       
  • 9. The concept of licence is contra distinguishable from the concepts of easement and interest in property. Licence is purely a personal right created and terminable at will, which may or may not be supported by material consideration. That is the reason why section 56 of the Indian Easements Act, 1882 provides that a licence is not transferable and section 59 provides that where the grantor of the licence transfers the property affected thereby, the transferee is not bound by the licence already granted.” 

The Bombay High Court in Prabhudas Damodar Kotecha v. Manharbala Jeram Damodar,  2007-5 MHLJ 341 (Upheld by the Supreme Court in: Prabhudas Damodar Kotecha v. Manharbala Jeram Dmodar, AIR 2013 SC 2959, 2013-15 SCC 358) held as under:

  • “Thus, it is seen that even in popular sense the word ‘licence’ is not understood to mean it should be on payment of licence fee for subsistence of licence. It also covers a ‘gratuitous licensee’, that is, a person who is permitted, although not invited, to enter another’s property and who provides no consideration in exchange for such permission

Consideration and Mutual Promises in Bare Licence u/S. 52

In Prabhudas Damodar Kotecha v. Manharbala Jeram Dmodar, AIR 2013 SC 2959, 2013-15 SCC 358, the Supreme Court held as under:

  • “43. … This Court in State of Punjab v. Brig. Sukhjit Singh, (1993) 3 SCC 459, has observed that 
  • “payment of Licence fee is not an essential attribute for subsistence of Licence.”
  • Section 52, therefore, does not require any consideration, material or non material to be an element, under the definition of Licence nor does it require the right under the Licence must arise by way of contract or as a result of a mutual promise.

Part II – Irrevocable Licences under S. 60(b) Easements Act

Sec. 52 is attracted, if only it is Not a ‘Contractual Licence’

As shown above, if only the right or permission given (licence) is not supported by any other ‘lawful’ means including a ‘contractual licence’, then only Sec. 52 is attracted.

That is, to attract Sec. 60(b) –

  • It must be a licence that falls under Sec. 52 Easements Act; which should be –
  • a bare, unilateral and gratuitous licence and
  • arisen not from any Contract (including a ‘contractual licence’).

Example: 

  • Owner of a property ‘licences’ his son to make a residential building in that property expending money of the son. The owner cannot revoke the licence after such construction.

As pointed out earlier, the Supreme Court emphasized in M.N. Clubwala v. Fida Hussain, AIR 1965 SC 610, that “the essence of a licenceis that it is revocable” and it defers from English “contractual licence”  that may be revocable or irrevocable according to the express or implied terms.  (It is seen that this English principle is adopted in Indian Law in several decisions.

Hunt and carry away deer killed – Licence coupled with Transfer of Property?

Joshi in his Commentary on the Easements Act, 1948 Edition, page 274it is stated as under:

  • “As a licence to go beyond the seas, to hunt in a mans park, to come into his house are only actions which without licence had been unlawful. But a licence to hunt in a mans park and carry away the deer killed to his own use; to cut down a tree in mans ground and to carry it away the next day after to his own use, are licences as to the acts of hunting and cutting down the tree, but as to the carrying away of the deer and the tree cut down, they are grants……..”

No doubt – it is a licence. However, it is doubtful whether “carry away the deer killed” comes under “(coupled with) a transfer of property and such transfer is in force” mentioned in Sec. 60(a) – because it has no connection to “immovable property”.

After referring this passage it is observed in Ghissu v. Hashim Ali, AIR 1954 (All) 683 (MH Beg, J.) as under:

  • “9. The rights thus created would not be revocable under S. 60. Easements Act, which states that a licence may be revoked by the grantor unless it is coupled with a transfer of property and such transfer is in force.”
  • It was a case where ‘a licence to the defendant to take away the crop of the grove on payment by the defendant of a yearly rent of Rs. 24/-‘.

It appears that the law is not correctly applied in this judgment – for, the licence mentioned did not fall under Sec. 52 Easements Act, because it was a ‘contractual licence’ for consideration.

S. 60(b) Applies Only to Bare Licences u/S. 52; and Not to ‘Contractual Licence’

The term ‘licence’ in Sec. 60 of the Easements Act (that deals with revocability of a licence), stands for a bare licence (under Sec. 52); andthe benefits this section is not extended to a ‘contractual licence’ (that is mentioned only in Sec. 64) for the following reasons –

  • Sec. 52 of the Easements Act refers to a bare and unilateral licence; and not to a ‘contractual licence’. 
  • The term ‘licence’ in Sec. 60 is contra-distinct to the term ‘licence’ in Sec. 64 which says as to ‘contractual licence’.  (Sec. 64 uses the added words – ‘a licence granted for a consideration’.) 
  • The enforcement of ‘contractual licence’ is governed under the Indian Contract Act; and not under the Easements Act. 
  • If the legislature intended to extend the benefit of Sec. 60 to ‘contractual licences’ also, it would have definitely used the additional words ‘licence granted for consideration’ in Sec. 60. 
  • Note: Sec. 64 is only an enabling provision similar to Sec. 64 and 65, Contract Act. 

Onus of Proving Irrevocable Licence  

A licence is irrevocable under S. 60(b) of the Act only if three conditions are fulfilled –

  • .(i) the licencee executed work of a permanent character, 
  • (ii) he did so acting upon the licence, and 
  • (iii) he incurred expenses in doing so. 

The onus of proving these facts lies upon the licencee and in the absence of any evidence on these questions the licence could not be irrevocable under S. 60(b) of the Act. Ram Sarup Gupta v. Bishun Narain Inter College, AIR 1987  SC 1242; 1987-2 SCC 555, is a leading authority on the subject. Following decisions were referred to in this decision:

  • Thakur Prasad v. J. Thomkinson, AIR 1927 Oudh 206.       
  • Mohammad Ali v. Ahmad Husain, AIR 1932 Oudh 264, 
  • Karan Singh v. Budh Sen, AIR 1938 All 342, 
  • Jagat Singh v. District Board, Amritsar, AIR 1940 Lahore 18 
  • Hashmat Jahan v. Sheo Dularey, AIR 1942 Oudh 180, 
  • Banamali Dalbehura v. Ratnamani Dei, (1954) 20 Cut LT 319, 
  • Raghubir Saran v. Param Kirti Saran, AIR 1962 All 444, 
  • Brundaban Jena v. Ram Chandra Misra, (1963) 29 Cut LT 37, 
  • Babulal Choukhani v. Caltex (India) Ltd., AIR 1967 Cal 205, 
  • Deep Chand v. Kasturi Devi, AIR 1975 Pat 17.

Grant and Revocation of Licence can Be Express Or Implied

In Ram Sarup Gupta v. Bishun Narain Inter College, AIR 1987 SC 1242; 1987-2 SCC 555, it is pointed out – 

  • The grant of licence may be express or implied which can be inferred from the conduct of the grantor. 
  • Revocation of licence may be express or implied.
  •  Section 62 enumerates circumstances on the existence of which the licence is deemed to be revoked. 
  • One of such conditions contemplates that where licence is granted for a specific purpose and the purpose is attained, or abandoned, or if it becomes impracticable, the licence shall be deemed to be revoked. 
  • A licence is revocable at the will of the grantor and the revocation may be express or implied. 

“Acting Upon The Licence“

It must be bare licence under Sec. 52; that is – “something which would be unlawful” is made lawful by granting license.  It must not be contractual. 

Our Apex Court referred, in Ram Sarup Gupta v. Bishun Narain Inter College, AIR 1987  SC 1242: 1987-2 SCC 555, the following two decisions in this regard –

  • (i) Gujarat Ginningand Manufacturing Co. Ltd., Ahmedabad V. Moti Lal Hirabhai Spinning and Manufacturing Co. Ltd., Ahmedabad, AIR 1936 PC 77. In this decision, protection of S. 60(b) of the Act was invoked by a party who had made constructions on his own land and not on the land of the licencer. The Privy Council held that the expression “acting upon the licence” must mean “acting upon a right granted to do upon the land of the grantor something which would be unlawful in the absence of such right.” A man does not “acting upon a licence” execute works and incur expense upon his own property as that he can do without any ones licence 
  • (ii) Shankar Gopinath Apte v. Gangabai Hariharrao Patwardhan, AIR 1976 SC 2506. Here, the plaintiff had raised plea that he was protected under S. 60(b), Easements Act, as he had executed works of permanent character on the land incurring heavy expenses. This Court rejected the submissions on the ground (i) of absence of pleadings, issues and evidence (ii) he had not done so “acting upon the licence” for he did so, in the belief that being a tenant he would become statutory purchaser of the land or that the oral agreement of sale will one fine day be implemented. 

“Coupled with an interest” – Corpus Juris Secundum

A licencee without the grant creates a right in the licensor to enter into a land and enjoy it. In Halsbury’s Laws of England, 4th Edition, Vol. 27 at page 21 it is stated: 

  • “Licence coupled with grant of interest: A licence coupled with a grant of an interest in property is not revocable. Such a licence is capable of assignment, and covenants may be made to run with it. A right to enter on land and enjoy a profit a prendre or other incorporeal hereditament is a licence coupled with an interest and is irrevocable. Formerly it was necessary that the grant of the interest should be valid; thus, if the interest was an incorporeal hereditament, such as a right to make and use a watercourse, the grant was not valid unless tinder seal, and the licence, unless so made, was therefore a mere licence and was revocable but since 1873 the Court has been bound to give effect to equitable doctrines and it will restrain the revocation of a licence coupled with a grant which should be, but is not, under seal.” (Quoted in: Pradeep Oil Corporation v. Municipal Corporation of Delhi, AIR 2011 SC 1869; 2011-5 SCC 270.)

Corpus Juris Secundum, Vol. LIII, pp. 815-16 reads as under: 

  • “As a general rule a mere License, that is, one which is merely a personal privilege not coupled with an interest in the land, may be revoked by the licensor at any time, at his pleasure. This rule generally applies regardless of how long the use has been permitted, and although the intention was to confer a continuing right, and even though the License was created by a deed or other written instrument. The general rule, however, is not without its modifications and exceptions, and does not apply 
  • where the License is coupled with or partakes of the character of an easement and 
  • the rights under it are affirmatively and definitely fixed and settled, or 
  • where it constitutes part of a contract between the parties. ” 
  • (Quoted in Sumikin Bussan (Hong Kong) International Limited v. Manharlal Trikamdas Mody, 2006-6 AllMR 347; 2006-4 BomCR 131; 2006-6 RCR(Civ) 347; M. F. De Souza v. Childrens Education Uplift Society, AIR 1959 Bomb 533)

Sec. 52, Easements Act: Specific Contention Needed

Pleading and evidence are insisted in cases which claimed ‘irrevocable Licence’ under Sec. 60(b) Easement Act. See:

  • R. Mohan v. Sarat Chandran Nair, 2016-4 KHC 318; 2016-4 KLT 15.
  • Ramesh Raghunath v. Pandurangrao Ambadasrao Ratnalikar, 2006-4 BomCR 910 (Plea and evidence necessary, though right not claimed in “specific words”)
  • Francis v. Andrew, 2008-6 AllMR 874; 2008-6 MhLJ 450
  • Elizabeth v. Saramma, AIR 1985 NOC 159 (Ker)
  • Zila Panchayat Etah v. Om Prakash Shah, 01 Sep 2017 2017 0 Supreme(SC) 1418

In Shankar v. Gangabai, AIR 1976 SC 2506, the Supreme Court observed as under:

  • “… even assuming that the appellant has executed work of a permanent character on the land it cannot be said that he has done so acting upon the Licence“, as required by S.60 (b) of the Basements Act. If be really improved the land by executing a work of a permanent character, be did so in the belief that being a tenant he will become a statutory purchaser of the land, or that the oral agreement of sale will one fine day be implemented The execution of work would therefore be in his capacity as a tenant or a prospective purchaser and not in his capacity as a licensee”. (Quoted in: Kesavan Nair Vs Narayanan Nair, 27 Oct 1988 1988 2 KLT 1006)

In R. Mohan v. Sarat Chandran Nair, 2016-4 KHC 318; 2016-4 KLT 15, it is held as under:

  •  “It does not spell out any authorisation to the respondent to make a permanent structure. In the absence of such a stipulation in Ext.B2 and in the absence of evidence before the courts below that he had incurred expenses for construction of a shed for running a workshop, the courts below are not justified in holding that the respondent is entitled to get the benefit of Section 60(b) of the Act. Therefore, the contention of appellant that the lower courts erred is sustainable. Hence the substantial question of law is to be answered in favour of the appellant.”

In Gujarat Ginningand Manufacturing Co. Ltd., Ahmedabad v. Moti Lal Hirabhai Spinning and Manufacturing Co. Ltd., Ahmedabad, AIR 1936 PC 77,  protection of S. 60(b) of the Act was invoked by a party who had made constructions on his own land and not on the land of the licencer and in that factual backdrop the Privy Council held that the expression “acting upon the licence” must mean “acting upon a right granted to do upon the land of the grantor something which would be unlawful in the absence of such right.” A man does not “acting upon a licence” execute works and incur expense upon his own property as that he can do without any ones licence. (Referred to in: Ram Sarup Gupta v. Bishun Narain Inter College, AIR 1987  SC 1242; 1987-2 SCC 555

IN RECOVERY SUIT LANDOWNER CAN WIN IF S. 60(b) CLAIMANT FAILS

If the tenant challenges the title of the Landlord, it makes the tenant liable for Eviction under the General Rule

Where the defendant seeks to rely on Sec. 60(b) of the Easements Act in a recovery suit, the landowner can succeed by establishing ‘general title’. This is for two main reasons:

  1. Under Sec. 116 of the Indian Evidence Act, the defendant—being a tenant or licensee—is estopped from disputing the title of the landowner.
  2. The burden of proving the applicability of Sec.60(b) of the Easements Act lies on the defendant.

In Champa Lal Sharma v. Smt. Sunita Maitra (S.B. Sinha, J.), (1990) 1 BLJR 268, it was held:

  • “It is also well settled that one such relationship is admitted or established, tenant would be estopped and precluded from challenging the title of the landlord and if he does so, under the general rule, make himself liable for eviction on that ground.“ (Quoted in: Radha Devi v. Ajay Kumar Sinha, 1998-2 BLJR 1061; Biswanath Agarwala v. Savitri Bera 2009-15 SCC 693, S.B. Sinha and Deepak Varma, JJ.)

Tenant challenges Title of Landlord: Landlord can win the TITLE SUIT if he Proves his GENERAL TITLE

In Champa Lal Sharma v. Smt. Sunita Maitra (supra), it was further held:

  • “It, therefore, logically follows that a finding of existence of relationship of landlord and tenant is a sine qua non for passing a decree for eviction against a tenant except in a case, as mentioned hereinbefore** the plaintiff on payment of ad valorem Court fee may obtain a decree for eviction on the basis of his general title. (Quoted in: Radha Devi v. Ajay Kumar Sinha, 1998-2 BLJR 1061; Biswanath Agarwala v. Savitri Bera 2009-15 SCC 693)
  • ** Tenant challenges title of landlord; and no special law (e.g., BRC Act) bars to give such a relief.

In Abdul Waheed Khan v. Bhawani, AIR 1966 SC  1718, it was pointed out that unless jurisdiction was excluded the  civil court has jurisdiction entertain a suit based title.

In Biswanath Agarwalla v. Sabitri Bera, (2009) 15 SCC 693,it is held–

  • “The landlord in a given case** although may not be able to prove the relationship of landlord and tenant, but in the event he proves his General TITLE, may obtain a decree on the basis thereof.”
  • **Tenant challenges title of landlord; and no special law (e.g., BRC Act) bars to give such a relief.
  • This decision is referred to in TribhuvanShankar v. Amrutlal (S.B. Sinha and Deepak Misra, JJ.), 2014-2 SCC 788.

In Biswanath Agarwalla v. Sabitri Bera, (2009) 15 SCC 693, the question was formulated by the Court as under:

  • “Whether a Civil Court can pass a decree on the ground that the defendant is a trespasser in a simple suit for eviction is the question involved in this appeal.”

Following were the facts:

  • The defendant-tenant entered the suit shop in 1970.
  • Plaintiffs purchased the suit premises in 1980.
  • The plaintiffs served a notice on the defendant under Sec. 106, TP Act.
  • Plaintiffs filed Suit for eviction claiming to be the owners and landlords.
  • Defendant denied that he had ever been a tenant.
  • He claimed independent title. He claimed to have an agreement for sale with the owner.

The trial judge dismissed the suit on the following findings, in a nutshell –

  • .i. The plaintiffs proved to be the owner.
  • ii. The defendant failed to prove his independent title.
  • iii. The plaintiffs failed to prove the relationship of landlord and tenant.  
  • iv. The plaintiffs having failed to prove the tenancy, not entitled to a decree.

Appellate Court, relying on AIR 1984 ROC 78 (All.), page 35, and AIR 1984 All. 66  allowed the appeal and decreed the suit.

The High Court dismissed the Second Appeal.

Hence the appeal before the Apex Court(Biswanath Agarwalla v. Sabitri Bera, (2009) 15 SCC 693).

The Plaintiffs- respondents contended as under:

  • .i. Even in a suit for eviction, the plaintiffs would be entitled to obtain a decree for possession relying on or on the basis of his title.
  • ii. In a suit for eviction, it is for the defendant to show that he has a right to remain on the tenanted premises either as a permanent tenant or otherwise.

The right of the plaintiff (landlord) to recover, on the basis of “GENERAL TITLE” is asserted by the Supreme Court (Biswanath Agarwalla v. Sabitri Bera, (2009) 15 SCC 693) referring following decisions.

1. Radha Devi v. Ajay Kumar Sinha, 1998 (2) BLJR 1061. The Patna High Court accepted that a landlord is entitled to obtain a decree of eviction on the basis of his GENERAL TITLE, though he could not prove the relationship of landlord and tenant (when the tenant raised false claim of title).

2. Champa Lal Sharma v. Smt. Sunita Maitra, S.B. Sinha, J., (1990) 1 BLJR 268. It was held:

  • “It is also well settled that one such relationship is admitted or established, tenant would be estopped and precluded from challenging the title of the landlord and if he does so, under the general rule, make himself liable for eviction on that ground.
  • It, therefore, logically follows that a finding of existence of relationship of landlord and tenant is a sine qua non for passing a decree for eviction against a tenant except in a case, as mentioned hereinbefore the plaintiff on payment of ad valorem Court fee may obtain a decree for eviction on the basis of his general TITLE.”

3. Hajee Golam Hossain Ostagar v. Sheik Abu Bakkar, AIR 1936 Cal. 351. It was held – in a suit for ejectment, if the defendant claims the right to remain on a land permanently, he was ‘bound to show‘ the right ‘wherefore the onus would be on him‘.

End Notes

Not necessary to Plead ‘Specific Words’ or Expressions in the Statute 

In Ram Sarup Gupta v. Bishun Narain Inter College, AIR 1987  SC 1242; 1987-2 SCC 555, it is held as under:

  • “It is well settled that the pleadings need not reproduce the exact words or expressions as contained in the statute, nor the question of law is required to be pleaded. The substance of the respondents pleadings clearly informed that their case was that they had made constructions on the land acting upon the Licence which substantially met the requirement of law.” (Quoted in: Paryag Mahto v. Ram Janam Mahto, 1991 BBCJ 118 (Pat).

In Nawal Kishore v. Kauleshwari Devi, 1986 PLJR. 431, referring Nandlal Sah V. Pawan Devi (1979 BBCJ 599), Ouseph Verghese v. Joseph Aleya (1969) 2 SCC 539),  Paryag Mahto v. Ram Janam Mahto, 1991 BBCJ 118 (Pat) and Preme Raj v. The DL. F. Housing and Construction Pvt. Ltd. (AIR. 1968 SC 1355) it was held that the plaintiff’s willingness and readiness to perform his part of the contract need not be expressed be in the exact words used by the Legislature.

Rajiv Sahai Endlaw, J. observed in Sambhav Kapur v. British Indo German Industrial Organics Private Ltd. , 2017-236 DLT 123; 2017-69 PTC 617; 2017-4 RAJ 99, as under:

Pleading to contain “only” a statement in a concise form

  • “7. Burdening the plaint with passages of judgments and citing the said judgments is contrary to the tenet of pleadings and Orders VI and VII of the Code of Civil Procedure, 1908 (CPC) which requires a pleading to contain “only” a statement in a concise form of material facts on which the party relies for his claim or defence laying down negatively that it shall not contain evidence or law. It was also so held in 
  • The Mah. State Ele. Board vs. Madhusudan Dass, AIR 1966 Bom 160 (DB), 
  • Guruswami Achari vs. Vengiduswami Achari, AIR 1963 Mad 71, 
  • Lakshmi Narain vs. Union of India, AIR 1962 Pat. 64 (DB) and 
  • Sampuran Singh vs. Aryan Singh, AIR 1961 P&H 414 (DB). 

Pleadings need not reproduce exact words in the statute

  • Supreme Court also, in Ram Sarup Gupta vs. Bishun Narain Inter College, (1987) 2 SCC 555 held “it is well settled that the pleadings need not reproduce the exact words or expressions as contained in the statute, nor the question of law is required to be pleaded.” 
  • The Division Bench of this Court also in Abhay Sapru vs. Chitralekha Bukshi, 2008 (106) DRJ 589 held that though “pleadings must contain only the material facts and not the law, yet copious reference to the law has been made.” Such burdening of the plaint with what is not required to be contained therein has a cascading effect, with the defendant replying thereto, the plaintiff filing replication thereto, issue, though not really required to be framed being framed thereon and often, evidence also being led thereon and is one of the causes of delay in disposal of suits. 

Courts to strike out pleadings under Order 6 Rule 16 

  • Rule 16 Order 6 empowers the Courts to strike out pleadings which are unnecessary or vexatious or which may delay trial. Though power thereunder is found to have been used often in the past, with pleadings not conforming to the requirement of law being labelled as mofussil pleadings and being blamed on weakness, in language and law, of pleaders in mofussil courts but owing to docket explosion is now exercised rarely. 

A time has come for maintaining the discipline of legal proceedings

The Division Bench of this Court in Teva Pharmaceutical Industries Ltd. vs. Natco Pharma Ltd. (2014) 210 DLT 591 also lamented on the malady afflicting courts in cities including on the original side of the High Court. However refrain of the courts in exercising powers to strike off such pleadings is resulting in the principles of drafting of pleadings being thrown to the wind and passages of judgments being quoted in the plaint. A time has perhaps come for the Courts, which are responsible for maintaining the discipline of the legal proceedings before them, to refuse to entertain such pleadings to send a message to the pleaders. The plaint, being not in accordance with law and as provided in CPC, is liable to be rejected on this ground alone.”

Consideration and Mutual Promises in Bare Licence u/S. 52

In Prabhudas Damodar Kotecha v. Manharbala Jeram Dmodar, AIR 2013 SC 2959, 2013-15 SCC 358, the Supreme Court held as under:

  • “43. … This Court in State of Punjab v. Brig. Sukhjit Singh, (1993) 3 SCC 459, has observed that 
  • “payment of Licence fee is not an essential attribute for subsistence of Licence.”
  • Section 52, therefore, does not require any consideration, material or non material to be an element, under the definition of Licence nor does it require the right under the Licence must arise by way of contract or as a result of a mutual promise.
  • 44. We have already referred to Section 52 of the Indian Easement Act and explained as to how the legislature intended that expression to be understood. The expressions “licensor” and “licensee” are not only used in various statutes but are also understood and applied in various fact situations. The meaning of that expression “Licence” has come up for consideration in several judgments. Reference may be made to the judgment of this Court in 
  • C.M. Beena and Anr. v. P.N. Ramachandra Rao (2004) 3 SCC 595, 
  • Sohan Lal Naraindas v. Laxmidas Raghunath Gadit (1971) 1 SCC 276, 
  • Union of India (UOI) v. Prem Kumar Jain and Ors. (1976) 3 SCC 743, 
  • Chandy Varghese and Ors. v. K. Abdul Khader and Ors.  (2003 ) 11 SCC 328.
  • 45. The expression “licensee” has also been explained by this Court in 
  • Surendra Kumar Jain v. Royce Pereira (1997) 8 SCC 759. 
  • In P.R. Aiyar’s the Law Lexicon, Second Edition 1997, Licence has been explained as 
  • “A licence in respect to real estate is defined to be an authority to do a particular act or series of acts on another’s land without possessing any estate therein”. 
  • The word “licensee” has been explained in Black’s Law Dictionary, Sixth Edition to mean 
  • a person who has a privilege to enter upon land arising from the permission or consent, express, or implied, of the possessor of land but who goes on the land for his own purpose rather than for any purpose or interest of the possessor. 
  • Stroud’s Judicial Dictionary of Words and Phrases, Sixth Edition, Vol. 2 provides the meaning of word “licensee” to mean 
  • a licensee is a person who has permission to do an act which without such permission would be unlawful.
  • 46. We have referred to the meaning of the expressions “Licence” and “licensee” in various situations rather than one that appears in Section 52 of the Indian Easement Act only to indicate that the word Licence is not popularly understood to mean that it should be on payment of Licence fee, it can also cover a gratuitous licensee as well. In other words, a licensor can permit a person to enter into another’s property without any consideration, it can be gratuitous as well.”

End Notes

Dharamvir Khosla v. Asian Hotels (North) Ltd. , 21 Jul 2020,

Mukta Gupta, J.
2020 0 Supreme(Del) 738;

  1. “The plaintiffs have placed on record documents to show when two of the erstwhile licensees of the shops at Shopping Arcade settled, the defendant paid a sum of ?70 lakhs to ?1 crore in the year 2008 and 2010 respectively which leads to the clear inference as to the amount of money received by the defendant at the time when the license agreement was entered into. Further, the conduct of the defendant in repurchasing the rights in similarly placed shop owners” premises” by paying a consideration of Rs. 71,00,000/- per shop clearly indicate that a similar if not identical bargain was entered into for all the present plaintiffs and defendant clearly acknowledged that there was an interest, charge, lien, proprietary rights, ownership interest of the possessor and the occupiers thereunder. On the one hand, shops in the same arcade were rented at exorbitant price whereas the licence was granted to the plaintiffs for nominal charges towards actual maintenance. This contradiction goes to the root of the matter to depict the true nature of the understanding/ agreement between the parties.
  2. Referring to Section 60 of the Easement Act and the decision of the Supreme Court in Ram Sarup Gupta Vs. Bishun Narain Inter College & Ors., (1987) 2 SCC 555 it is contended that the plaintiffs not only meet the criteria laid down in the said decision but stand on a much higher footing. Referring to the Clauses in the decision of the Supreme Court in B. Arvind Kumar Vs. Govt. of India & Ors., (2007) 5 SCC 745 it is stated that the plaintiffs in terms of the law laid down therein have a much stronger claim to be licensees in perpetuity.
  3. In respect of the objections of the defendant that the present suits are not maintainable in view of the Clause 11 in the license agreement providing for arbitration for disputes including disputes relating to interpretation and clarification of the terms of the agreement, learned counsel for the plaintiffs contends that at this stage the prayers in the plaint have to be seen by way of demurer. Since the plaintiffs pray for decrees of declaration which are decisions in rem and not in personam, the same cannot be adjudicated by the arbitrators. Reliance is placed on the decision of the Supreme Court in Himangni Enterprises Vs. Kamaljeet Singh Ahluwalia, (2017) 10 SCC 706 , Berger Paints India Limited Vs. Taj and Company,2018 SCCOnlineKarnataka 3356 , and BGR Energy Systems Limited Vs. P.S. Techcom Pvt. Ltd.,2018 SCCOnlineMad 4714 . In any case the arbitration clause in the agreement is unforceable as the same provides for an even number of arbitrators, the same is impermissible in view of the amendments carried out in Section 10(1) of the Arbitration and Conciliation Act 2015.
  4. Mr. Dhruv Mehta, Senior Advocate appearing in CS(COMM) 184/2020 and 185/2020 adopts the arguments advanced by Mr. A.M. Singhvi, Senior Advocate for the plaintiff in the other four suits. He, however, states that in CS(COMM) 185/2020 the facts are slightly different inasmuch as the plaintiffs therein were permitted to carry out construction and create loft spaces for which separate notices have been issued to plaintiff No.1 i.e. in respect of plot No. U-61A and U-63A. Since the license has been transferred in the name of plaintiff No.2 in respect of shop U-61 notice has been issued to plaintiff No.2 in the said suit. Referring to Section 60 of the Easement Act learned counsel states that provisions of Section 60 are not exhaustive and a license can be irrevocable even under the provisions of the contract between the parties. The plaintiff continues to be licensee for 36 years and thus also from the conduct of the parties it is evident that the license was irrevocable. Thus, equity weaves into a covenant of irrevocability.
  5. Since in terms of Section 60 clause (b) of the Easement Act the plaintiff i.e. licensee has, acting upon the license, executed a work of permanent character and has incurred expenses thereon, the license has to be interpreted as a irrevocable one. When the transfer of license in respect of shop U-63 was done, the only transfer charges taken by the defendant were ?25,800/- whereas the plaintiff received a full consideration minus the consideration of the loft area. Since the defendant permitted part transfer of the licenses which concept is unknown under Section 60, it is evident that the intention of the parties was of creating irrevocable license.”

R. P. SHRIVASTAVA VS SHEELA DEVI, 22 Jun 2007
2008 2 CivLJ 288; 2007 4 MPLJ 102.

Arun Misra, J.

  •  “Considering the aforesaid evidence adduced by the parties coupled with the pleadings, it is clear that the defendant came to the Court with the plea that house was given to Bhairo Prasad by Laxmi Narayan. It is apparent that Leeladhar died in the year 1932, he left behind three sons namely Roshan Lal, Udaybhan and Bhanu Prakash. Sheelwati is daughter of late Leeladhar. Bhanu Prakash died young at the age of 16-17 years in the year 1939. Roshan Lal died in the year 1941 and Udaybhan died in the year 1980. Marriage of Sheelwati was performed with Bhairo Prasad in the year 1934 after the death of her father Leeladhar. Thus it is apparent that considering the activity of Bhairo Prasad of Hindu Mahasabha and various other difficulties faced by Sheelwati in in-laws’ house, Roshan Lal and Udaybhan gave them the house for the purpose of their residence. What were the terms on which the house was given has to be considered in the case on the basis of the evidence adduced by the parties. It is also to be considered whether it was simpliciter licence given for the purpose of residence or it was coupled with the grant. Section 52 of the Easement Act, 1882 defines the licence where one person grants to another, or to a definite number of other persons, a right to do, or continue to do, in or upon the immovable property of the grantor, something which would, in the absence of such right, be unlawful, and such right does not amount to an easement or an interest in the property, the right is called a license. Section 60 of the Easement Act lays down that a license may be revoked by the grantor, unless it is coupled with a transfer of property and such transfer is in force and the licensee, acting upon the license, has executed a work of a permanent character and incurred expenses in the execution. A licence coupled with creation of an interest in land is as binding and irrevocable as any other contract, gift or grant. In Narsing Das vs. Ratanlal and others, AIR 1915 Nag 29 it was laid down that licence coupled with void grant is revocable save (1) where the licensee entered into occupation and paid rent and (2) where the licensee, acting on the license, has executed a work of a permanent character and incurred expense in so doing. Discussing the various decisions it was also observed that a mere license is, in its nature, revocable and that a license coupled with a grant is irrevocable. In spite of void agreement in case licensee has entered into occupation and paid rent licence, cannot, therefore, be revoked at will. In Secretary of State vs. Hiranand Ojha and others, AIR 1918 Pat 366 where the plaintiff allowed defendant to execute and work out on his land irrigation scheme of considerable benefit, at considerable expense, it was held that agreement created licence, which could not be revoked at the instance of the plaintiff. In AIR 1940 18 (Lahore) , it was held that sinking well and erecting compound wall are works of permanent character within the meaning of section 60 of Easement Act. In Biswanath Panda vs. Gadadhar Panda and another, AIR 1971 Ori 115, it was laid down that though section 60 is not applicable in Cuttack at the relevant time, principles contained therein were held to be applicable. It was also held that mere licence is revocable but where it is coupled with a grant, it becomes irrevocable. Where there is no formal document embodying the terms of agreement, the intention is to be inferred from surrounding circumstances and the conduct of the parties. In Biswanath Panda (supra) it was held thus :
  • 13. A mere licence does not create any estate or interest in the property to which it relates. It only confers legality on an act which would otherwise become unlawful. A licence may be purely personal, gratuitous or contractual. The first two classes of mere licenses are revocable, the third class is revocable or not revocable according to the express or implied terms of the contract between the parties. A license coupled with grant of an interest in nature of property is not revocable. Such a license has been stated in Halsbury’s Laws of England, Vol. 23 (3rd Edn.) page 432 to be A right to enter on land and enjoy a profit a prendre or other incorporeal hereditament.
  •        The Bhopal State Easement Act (Act 7 of 1337 Mohammadi) was promulgated which contained similar provision to that of Easement Act, 1882, thus there is no difficulty with respect to applicability of the provision of Easement Act as provisions were pari-materia. Similarly the provisions of Bhopal State Transfer of Property Act was similar to the T.P. Act 1882 with respect to disposition of the property.
  •  In Ram Sarup Gupta (Dead) by Lrs. Vs. Bishun Narain Inter College and Others, , their Lordships laid down that facts and circumstances have to be considered in each case. It was held in the facts and circumstances, that school was permitted to occupy and enjoy the land permanently for the purpose of education and it would be reasonable to infer implied condition that the license was irrevocable. The Apex Court has laid down thus:
  •        “13……. These facts and circumstances point out the terms and conditions of the license, that the school was permitted to occupy and enjoy the land permanently for the purpose of education. In this background, it would be reasonable to infer an implied condition that the license was irrevocable and the school was permitted to occupy and use the premises so long as it continued the purpose of imparting education to the students.”    

Dominion of India VS R.  B.  Sohan Lal, 13 Sep 1949,

AIR 1950 (P&H) 40 (S.R. Das, CJ, Soni, J.)

  • 15. I approach this question first on the basis that the Easements Act applied to this case by virtue, as contended by the appellant, of S.3 and S.4 read with schedule III of the Delhi Laws Act 1915 (Act VII (7) of 1915). I have already referred to S. 52, Easements Act, which defines a “license”. It is quite clear that cl.(1) of the agreement confers on the licensee a right to do in or upon the immovable property of the licensor something, namely, selling books etc. which would, in the absence of such right, be unlawful. It is also clear that such right does not amount to an easement as defined in S.4 of that Act or an interest in the property. It consequently follows that this clause (1) creates only a license. The terms of this agreement show that it is not “coupled with a transfer of property” within the meaning of cl. (a) of S.60 of the Act. The license may be coupled with a grant of the right to carry on business in the station premises but there is no transfer of property in the sense that any interest in the station premises has been transferred. Nor is there by any suggestion that the book-stalls set up by the licensee constitute the execution of a work of a permanent character within the meaning of cl. (b) of S.60. As this license does not fall either within cl.(a) or clause (b) of that section it must he regarded, prima facie and in the absence of anything else, to be a revocable license. Is there anything special in the agreement which will override this prima facie conclusion? That the license is for a period of 5 years, that it has been granted for very valuable consideration and that it is assignable with the requisite consent of the licensor are elements which may, to a certain extent, incline the Court towards the view that the license was intended to be irrevocable but are not to my mind, decisive on the question. Clause (22), however, clearly implies that the licensee performing all its obligations under the agreement it will be entitled to peaceably enjoy the license for the full term. Adopting the language of Buckley, L.J. in Hurst v. Picture Theatres Ltd., (1915 1 K.B. 1: 83 L.J.K.B. 1837) (supra at P.10), I would be prepared to say that there is “included in that contract a contract not to revoke the license” if the licensee performs all its obligations under the agreement and I would be inclined to hold, if that clause stood alone, that the parties by their special contract made the license, which was prima facie revocable under S.60, an irrevocable license and that a threatened revocation thereof should be enforced by an injunction restraining the breach of the implied negative covenant. But this clause (22) has to be read along with and in the light of the preceding clauses (11) and (19) which I have quoted above. These clauses clearly envisage the revocation of the license on the happening of certain things.
  • Reading cl.(11) and cl.(22) together the position appears to be that the license is irrevocable if the licensee performs its obligations but if it fails to do so it will be lawful for the licensor to revoke it. It is not necessary to enquire whether the words “of which the General Manager shall be the sole judge” in cl.(11) govern only the clause immediately preceding those words or they govern all the clauses preceding them, for the revocation has been founded inter alia on breach of the immediately preceding clause. If these words were not in cl. (11), it would have been an issue of fact at the trial whether there had been a default on the part of the licensee within the meaning of that clause and there might have been some plausibility and force in the argument that until that issue had been decided by the Court there should be a temporary injunction. Here, however, the parties have, by their special contract made the General Manager, whose place is now taken by the Chief Administrative Officer by virtue of the notification I have referred to, the sole judge of that issue and that officer has adjudged it by his order dated 29th September 1948 which has also been mentioned above. I do not read the words “of which the General Manager shall be the sole judge” as at all constituting an arbitration agreement in the nature of like provisions in building contracts whereby the architect employed by the owner is made the sole judge of the act or conduct or claim of the contractor. In building contracts, the architect is actually appointed as arbitrator by the submission clause and the architect has to observe and perform the obligations of an arbitrator. The words in cl.11 with which we are concerned are by no means a submission to arbitration of the General Manager so as to impose upon the General Manager the duties of an arbitrator in the matter of giving notice of meeting, hearing parties and the like. All that the words mean is that it shall be lawful for the licensor to revoke the license if in the opinion of its General Manager the licensee has been guilty of any breach of any of the conditions of the license. It does not mean that the General Manager has to give notice to the parties, hold meetings and make an award declaring that there has been any breach on the part of the licensee. Further, there is ample evidence on the record to show that time and again and on several occasions warnings were given to the licensee as to various breaches and calling upon it to rectify its conduct so as to put the business in a satisfactory order and eventually on 29th September 1948, the Chief Administrative Officer ordered that as the licensees “work was unsatisfactory and he was unable to conduct business as bookstall contractor” notice should be issued terminating the license. The licensee agreed to abide by the opinion of the General Manager and cannot now be heard to complain against it. Learned counsel for the respondent-licensee has drawn our attention to a letter dated 29th October 1948, written by the Honble Sri K. Santhanam, Minister of State for Transport and Railways, that the termination of the contract was the result of a decision taken by the Central Advisory Council for Railways. If the Chief Administrative Officer took the precaution out of abundant caution of having his own decision endorsed by the Central Advisory Council for Railways, that circumstance does not alter the fact that the Chief Administrative Officer had decided the question of which he had been made the sole judge. There is on the affidavits no charge, and far less any proof, of actual misconduct, on the part of the Chief Administrative Officer personally which may in any way be taken as vitiating his judgment and decision. In the absence of any charge of fraud or actual misconduct against the officer personally and of any proof on record I do not think his decision can be challenged in any Court. Such being the position, I am quite satisfied that this is not a case where a perpetual injunction could possibly be issued at the hearing and, therefore, on principle, no temporary injunction should have been granted in this case. If the Calcutta decisions referred to above were correct the only remedy, if any, of the respondent licensee would lie in damages unless of course cl.(11) bars even that remedy as to which I express no opinion. Again, if the argument that the Indian Easements Act having, by S.64, prescribed the special remedy by way of damages, no other remedy is available were sound, then also no injunction can be granted.
  • Finally, if the license has, by special agreement, been made revocable on certain grounds as to the existence of which a particular persons opinion has been made the sole test and criterion and he has expressed his opinion as I hold he has, then also there can be no injunction, for to grant an injunction in such circumstances will be to make that irrevocable which the parties themselves had by their special contract thought fit to make revocable.”

How to Subscribe ‘IndianLawLive’? Click here – “How to Subscribe free “

Read in this cluster (Click on the topic):

Civil Suits: Procedure & Principles

Book No, 1 – Civil Procedure Code

Principles and Procedure

PROPERTY LAW

Title, ownership and Possession

Adverse Possession

Land Laws/ Transfer of Property Act

Land Reform Laws

Power of attorney

Evidence Act – General

Sec. 65B

Admission, Relevancy and Proof

Law on Documents

Documents – Proof and Presumption

Interpretation

Contract Act

Law on Damages

Easement

Stamp Act & Registration

Divorce/Marriage

Negotiable Instruments Act

Criminal

Arbitration

Will

Book No. 2: A Handbook on Constitutional Issues

Religious issues

Book No. 3: Common Law of CLUBS and SOCIETIES in India

Book No. 4: Common Law of TRUSTS in India

Unknown's avatar

Published by sajikoduvath

Leave a Comment