Case Note & Summary
The appellant, Horizon Exhibitions And Events Pvt. Ltd., filed a suit for possession of premises against the respondent, RMB Event Management Pvt. Ltd., based on a lease agreement dated 1st April 2014. The lease was for a period of three years, from 1st April 2014 to 31st March 2017, at a monthly rent of Rs. 1,50,000. The appellant claimed that the respondent failed to pay rent and vacate the premises. The trial court decreed the suit for possession but directed the appellant to pay Rs. 1,50,000 to the respondent as compensation for the notice period. The appellant appealed against the direction to pay compensation, and the respondent filed a cross-objection. The High Court noted that the lease agreement was unstamped and unregistered. Under Section 35 of the Bombay Stamp Act, 1958, an unstamped instrument cannot be admitted in evidence for any purpose. Further, under Section 107 of the Transfer of Property Act, 1882, a lease for more than one year requires registration. Since the agreement was for three years and was not registered, no valid lease was created. The court held that the trial court erred in admitting the unstamped agreement and in granting any relief based on it. The appeal was allowed, setting aside the direction to pay compensation, and the cross-objection was dismissed for want of prosecution.
Headnote
A) Stamp Act - Admissibility of Unstamped Agreement - Section 35 Bombay Stamp Act, 1958 - An unstamped lease agreement for a period exceeding one year is inadmissible in evidence for any purpose, including for proving the terms of the lease or for seeking possession - The court held that the trial court erred in admitting the unstamped agreement and in granting relief based on it (Paras 1-7). B) Transfer of Property Act - Lease for More Than One Year - Section 107 Transfer of Property Act, 1882 - A lease of immovable property for a term exceeding one year can be made only by a registered instrument - The court held that the agreement in question, being for a period of three years, required registration and was not registered, hence no valid lease was created (Paras 1-7). C) Civil Procedure - Cross-Objection - Dismissal for Want of Prosecution - Where the cross-objector fails to appear, the cross-objection is liable to be dismissed for want of prosecution - The court dismissed the cross-objection as none appeared for the cross-objector (Para 1).
Issue of Consideration
Whether an unstamped and unregistered lease agreement for a period exceeding one year can be admitted in evidence and whether the appellant is entitled to possession of the suit premises.
Final Decision
The appeal is allowed. The impugned order directing the appellant to pay Rs. 1,50,000 to the respondent is set aside. The cross-objection is dismissed for want of prosecution.
Law Points
- Unstamped lease agreement cannot be admitted in evidence
- Section 35 of Bombay Stamp Act
- 1958
- Section 2(g) of Bombay Stamp Act
- Section 107 of Transfer of Property Act
- 1882
- Section 105 of Transfer of Property Act
- Lease for more than one year requires registration
- Unregistered lease deed inadmissible
- Cross-objection dismissed for want of prosecution
