Suit for declaration of tenancy post-expiry of leave and license agreement, unsupported by law or material facts, is not maintainable; High Court reaffirms Supreme Court parameters for rejecting plaints under Order VII Rule 11 CPC—binding on Maharashtra courts and persuasive elsewhere.
Summary
| Category | Data |
|---|---|
| Case Name | CRA/627/2024 of SMT. MEENAKSHI BALASO MAGDUM AND ORS Vs G.B. INDUSTRIES REG. PARTNERSHIP FIRM THR. ITS VISHAL SHARADCHANDRA BHOGTE AND ORS |
| CNR | HCBM070562872024 |
| Date of Registration | 05-12-2024 |
| Decision Date | 15-10-2025 |
| Disposal Nature | Allowed |
| Judgment Author | HON’BLE SHRI JUSTICE S. G. CHAPALGAONKAR |
| Court | Bombay High Court |
| Precedent Value | Binding on subordinate courts in Maharashtra; persuasive for other jurisdictions |
| Overrules / Affirms |
|
| Type of Law | Civil Procedure; Tenancy Law; Rent Control |
| Questions of Law | Whether a plaint seeking declaration of tenancy rights by a licensee after expiry of a leave and license agreement, without basis in statute or facts, discloses a “cause of action” and is maintainable, or be rejected as vexatious under Order VII Rule 11 CPC. |
| Ratio Decidendi |
The Court held that a plaint must disclose a genuine cause of action supported by material facts; merely continuing in possession after expiry of a leave and license agreement does not provide a ground for statutory tenancy. The plaint, in this case, was illusory and amounted to camouflage—the suit was vexatious and raised no tenable rights either under the Maharashtra Rent Control Act or Tenancy Acts. The statutory definitions of “premises” and the conditions for tenancy were not satisfied; open land under a leave and license cannot become “premises” in terms of the Rent Act. The plaint was liable to rejection as an abuse of process. |
| Judgments Relied Upon |
|
| Logic / Jurisprudence / Authorities Relied Upon by the Court | Supreme Court principles on “cause of action”, vigilance against illusory or vexatious litigation, meaning of “premises” under Maharashtra Rent Control Act, non-applicability of tenancy/land laws to mere licensees post expiry. |
| Facts as Summarised by the Court |
Plaintiff was given open land by leave and license from 2015 to 2020, built a shed, continued to pay Rs. 4500/month after expiry. Defendants gave notice to vacate; plaintiff claimed statutory tenancy. The land was under acquisition; writ for compensation failed as plaintiff was only a licensee. Suit only for declaration of tenancy rights post-expiry. Order rejecting plaint at trial court was challenged in revision. |
Practical Impact
| Category | Impact |
|---|---|
| Binding On | All subordinate courts in Maharashtra |
| Persuasive For | Other High Courts and potentially the Supreme Court |
| Follows |
|
What’s New / What Lawyers Should Note
- Reaffirms that continuance in possession post-expiry of a leave and license agreement does not, by itself, confer statutory tenancy under the Maharashtra Rent Control Act.
- Plaints based on clever drafting or camouflage—asserting tenancy without legal or factual basis—are liable for rejection under Order VII Rule 11 CPC.
- Courts are required to test if the cause of action is real or illusory, especially regarding tenancy claims over open land licenced for non-agricultural use.
- Lawyers must ensure that tenancy claims are substantiated by statutory grounds and material facts, not mere assertion or possession.
- Reference to earlier failed writ petitions on related claims may strengthen the ground for rejection of plaint.
Summary of Legal Reasoning
- The Court first referenced the Supreme Court’s parameters on “cause of action” and rejection of plaints (Dahiben, T. Arvivandandam, Swamy Atmananda), emphasizing the need for a bundle of material facts legitimately entitling the plaintiff to relief.
- Examined the plaint, relevant agreements, and statutory definitions, concluding that the leave and license arrangement explicitly prohibited accrual of tenancy rights.
- Stressed that open land given under leave and license cannot become “premises” under the Maharashtra Rent Control Act, and that statutory tenancy post-expiry was legally untenable.
- The Court relied on the High Court’s own previous judgment (in the plaintiff’s failed writ petition), which found the tenancy claims “untenable,” “frivolous,” and lacking any legal support under either the Rent Act or tenancy acts.
- Recognizing the land’s acquisition, and absence of any right to compensation for a licensee, the Court found the suit to be “vexatious” and a clear abuse of process.
- Directed that such illusory claims must be “nipped in the bud,” reiterating Supreme Court’s condemnation of bogus litigation via camouflage.
Arguments by the Parties
Petitioner
- Plaintiff was only a licensee; agreement expressly precluded tenancy rights.
- Suit is vexatious, has no cause of action, and was filed for mala fide purposes to extract money.
- Plaintiff’s writ seeking protection as a tenant was already dismissed; he has no semblance of legal right.
- Application under Order VII Rule 11 CPC for rejection of plaint should have been allowed.
Respondent
- Possession of suit property is admitted; defendants accepted rent post expiry, thus tenancy accrued.
- Suit was not barred by law; cause of action arose with the eviction notice.
- Rejection of plaint is only permissible under Order VII Rule 11 CPC strictly on statutory grounds; plaintiff’s pleadings disclose a cause of action needing adjudication.
Factual Background
Plaintiff, a registered partnership firm, was given an open plot of land by the defendants under a leave and license agreement valid from March 2015 to March 2020, with permission to erect a shed. After expiry, plaintiff continued in possession and claimed to be a statutory tenant, citing ongoing rent payments. Defendants issued a notice seeking vacation of the land. Simultaneously, the property was under government acquisition. Plaintiff’s earlier writ petition for protection and compensation was dismissed. Plaintiff then filed the present suit for declaration of tenancy; defendants sought rejection of plaint under Order VII Rule 11, which was initially denied by the trial court.
Statutory Analysis
- Order VII Rule 11 CPC: The Court interpreted the grounds for rejection of plaint, particularly regarding “disclosure of cause of action” (clause a) and “barred by law” (clause d).
- Maharashtra Rent Control Act: The definition of “premises” and preconditions for statutory tenancy were examined—the Court found a licensee on open land for commercial purpose did not qualify for protection under the Act.
- Maharashtra Tenancy and Agricultural Lands Act: The Court found it inapplicable as the land was not given for agricultural purposes.
- No statutory right to compensation or tenancy was found to accrue to a mere licensee post-expiry.
Alert Indicators
- ✔ Precedent Followed