Holding

The lease was not extinguished by merger or demolition; the landlord‑tenant relationship continued and the eviction decree was valid.

Summary

The Supreme Court examined an eviction suit under the A.P. Buildings (Lease, Rent & Eviction) Control Act, 1960 where the landlord, a co‑owner of a disputed property, sought possession of premises occupied by tenants who had transferred possession to third parties that had bought only part of the co‑owners' shares. The appellants argued that the doctrine of merger extinguished the landlord‑tenant relationship because they had acquired both ownership and tenancy rights, and that demolition of the building ended the lease. The Court held that merger does not apply where the purchaser acquires only a partial interest and the lessor’s and lessee’s estates have not coalesced in the whole property; likewise, demolition of the superstructure does not terminate a lease when the land remains. Consequently, the landlord‑tenant relationship persisted and the eviction decree was upheld.

Issues considered

The applicability of the doctrine of merger to extinguish the lease when the purchaser acquires only a partial ownership interest and the tenancy rights.
Whether demolition of the building (superstructure) terminates the lease under the doctrine of frustration.
Whether a co‑owner who acquires a partial share can be treated as a landlord for purposes of eviction under the A.P. Buildings Act.
Whether the tenants’ transfer of possession without the landlord’s consent constitutes a parting with possession justifying eviction.

Legislation cited

Indian Evidence Act, 1872s. 116
Transfer of Property Act, 1882s. 105, s. 111(1)(d), s. 5

Subjects

landlord-tenantdoctrine of mergerleaseevictionco-ownershippartitionTransfer of Property ActA.P. Buildings (Lease, Rent & Eviction) Control Actdemolitionfrustrationpartial ownershiptenancy rights

Judgment

··~.

T. LAKSHMI PA THI AN:O ORS. A
v.
P. NJTHYANANDA REDDY AND ORS.

MARCH 31, 2003

B
[R.C. LAHOTI AND ARUN KUMAR, JJ.]

Rent Control and Eviction:

A.P. Buildings (Lease, Rent and Eviction) Control Act, 1960: c
Landlord became co-owner of the suit property due to partition in
property-Some of the co-owners sold their rights of ownership in tlie property
-_Tenants transferring possession to vendee-Eviction petition-Decreed by
the courts below and affirmed by High Court-Landlord-tenant relationship-
Determination of-Doctrine ofmerger-Scope of-Held: Interest of the landlord D
did not vest in the vendee since he acquired interest of only some of the co-
owners-By the act of transferring possession by tenants, vendee acquired
tenancy rights-Hence vendee acquired partial ownership and fi11/ tenancy
rights-Under such circumstances interests of lessee and the lessor in the
whole property not vested in the vendee at the same time and in the same E
right-Hence relationship of landlord-tenant continues to exist-Doctrine of
merger not attracted-Lease not determined by merger-Transfer of Property
Act.1872-S. I J l.

Erection of new structure on the premises in occupation of tenant-
Demolition ofsuperstructure by tenant but continuance of the land thereunder- F
Tenancy-Effect on-Held: Tenancy continues to exist since entire premises
have not been lost-Transfer of Property Act, 1882-Ss. 5 and 105.

Property-Co-owner-Rights of-Discussed.

Doctrines:
G
"Doctrine of merger" and "Doctrine of frustration "-Meaning and
applicability of

Landlord-respondent No. I became one of the co-owners along with
other co-owners (viz. five sisters and widow of younger brother) of the H
173
174 SUPREME COURT REPORTS [2003] 3 S.C.R.

A disputed property as a result of parti1ion in the family property. Against
the preliminary decree passed by the Trial Court for partition of the
property, an appeal was pending. In the meanwhile all the co-owners
except one sister and respondent No. l transferred their ownership rights
in suit premises to appellant Nos. 3 to 5 by executing a sale deed and
B thereafter the tenants handed over the possession in respect of suit
prcmi.>es to appellants. However, respondent No. I initiated eviction
proceedings against tenants under the A.P. Buildings Control Act on
grounds of honajide requirement and for non-payment of arrears of rent.
Further, appellants 3 to 5 transferred their rights and interest in the
property to appellants Nos. I and 2 by a registered sale deed. Rent
C Controller decreed the eviction suit. Appellate Authority confirmed the
order of eviction. On dismissal of revision petition by the High Court,
appellants preferred the present appeal.

It was contended for the appellants that since the appellants were
also co-owners of the suit property, the suit for eviction would not lie and
D that on demolition of tenancy premises, the subject matter of tenancy
having ceased to exist the tenancy has come to an end.

On behalf of the respondent it was submitted that since tenants in
the suit property had transferred possession to appellants without the
consent of the iandlord, it is· a case of partinu,, with possession by tenants;
E and that by such act of transferring of possession, tenancy could not have
been merged with ownership and the relationship of the landlord-tenant
could not be brought to an enll. •
Dismissing the appeal, the Court

F HELD: I.I. The doctrine of merger contemphites (i) coalescence of
the interest of the lessee and the interest of the lessor; (ii) in the whole of
the property; (iii) at the same time; (iv) in one person; (v) in the same
right. There must be a complete union of the whole interests of the lessor
and the lessee so as to enable the les!.er interest of the lessee sinking into
G the larger interest of the lessor in the reversion. 1183-BI

Lmr Lc:xicon. Second Edition, 1997 by P. Ramanatha Aiyar; Tomlins
Lll\r Dict1onw)·; 2 Black Com., 177; and Genural Lu\1' of Landlord and Tenant
hy Foa Eighth Edition, 642, referred to.

H 1.2. In the instant case, the appellants are not purchasers of the entire
T. LAKSHMIPATHI v. P.N. REDDY 175
ownership interest in the property. They have purchased interest of some A
out of all the co-owners of the property. The interest of the respondent
No. I has not come to vest in the appellants. The appellants have also
acquired the tenancy rigMs in the property. Thus they have acquired
partial ownership and full tenancy rights. It cannot be said that the
interests of the lessee and the lessor in the ·whole of the property have B
become vested in the appellants at the same time and in the same right.
The leas~ cannot be said to have been determined by merger. So long as
the interests of the lessee, tire lesser estate and of the owner, the larger
estate do not come to coalesce in full either the water of larger estate is
not deep enough to enable annihilation or the body of lesser interest does
not sink or drown fully. 1184-A, B, Cl C

Badri Narain Jha and Ors. v. Rameshwar Dayal Singh & Ors., 119511
SCR 153; Shaikh Fqir Bakhsh v. Murli Dhar and Ors., AIR (1931) PC 63;
Parmeshwar Singh and Ors. v. Ml. Sureba Kuer and Ors., AIR (1925) 530;
Lala Nalh1111i Prasad and Ors. v. Syed Anwar Karim and Ors., (1919) IC
16(Pat.) and Nalakath Sainuddin v. Koorikadan Sit!aiman, 120021 6 SCC l, D
relied on.

J.3. The tenancy cannot be said to have been determined by
attracting applicability of the doctrine of frustration consequent upon
demolition of the tenancy premises. Doctrine of frustration belongs to the
realm of Law of Contracts; it does not apply to a transaCtion where not E
only a privity of contract but a privity of estate has also been created
inasmuch as lease is the transfer of an interest in immovable property.
1184-F, GI

Raja Dhruv Dev Chand v. Raja Harmohinder Singh and Anr., I I 96813 F

- SCR 339, relied on.

to.
laws of Landlord and Tenant by Wood/all 28th Edn. Vol. I - referred

1.4. A lease of a house or of a shop is a lease not only of the G
superstructure but also of its site. It would be different if not only the site
but also the land beneath ceases to exist by an act of nature. In the instant
case the appellants who are the successor of the tenancy right have
demolished the superstructure but the land beneath continues to exist. The
entire tenancy premises have not been lost. Moreover, the appellants
cannot be permitted to take shelter behind their own act prejudicial to H
176 SUPREME COURT REPORTS [2003] 3 S.C.R.

A the interest of respondent No. I under whom respondents No. 2 and 3 were
holding as tenants and then inducted the appellants. In the event of the
tenancy having been created in respld of a building standing on the land,
it is building and the land which an~ both components of subject matter
of demise and the destruction of the building alone does not determine
B lhe tenancy when the land which was site of the building continues to exist;
more .>o when the building has beern destroyed or demolished neither by
the landlord nor by an act of nature but solely by the act of the tenant or
the person claiming under him. [ 185-F, G, H; 186-C, DI

D. (i 0ousa & Co. (Ag.:nts) Pvt. ltd. v. State of Kera/a and Anr., I I 9801
C 2 SCC -H 0 and Corporation of the City of Victoria v. Bishop of Vancouve
/s/a11J. A IR ( 1921) PC 240, relied on.

George .J. Ornngal v. Peter. AIR (1991) Kerala 55; Rahim Bux and
(!rs. v. \/olw111111aJ Shafi. AIR (1971) Allahabad 16; Hind Rubber Industries
Pvt. Lid v. ?iJyehhal NohammeJbhai Baasarwalla and Ors., AIR (1996) Born.
[) 389; Ji1m11/al & Co and Ors. v. Manoi & Co. ltd. 64 CWN 932 and Dr. V
Sidharthan v. Put1/ori Ramadasan, AIR (1984) Kerala 181, referred to.

1.5. The law as to co-owners is well settled. Where any property is
held by several co-owners. each co-owner has interest in every inch of the
common proptorty, but his interest is qualified and limited by similar
E interest of the other co-owners. One co-owner cannot take exclusive
possession of the property nor commit an act of waste, ouster or
illegitimate use, and if he does so he may be restrained by an injunction.
A co-owner may, by an arrangement, express or implied, with his other
co-owners. possess and enjoy any property exclusively. Such a co-owner
f can also protect his possession against the other co-owner and if he is
dispossessed by latter, he can recover exclusive possession. Neither
respondents No. 2 and 3 nor their successors in interest or the persons
daiming under them could have denied the title of respondent No. 1 during
the continuance of the tenancy and even thereafter unless they had
restored possession over the tenancy premises to respondent No. I.
G Looking at the status of the appellants whether as co-owners or as persons
inducted in possession by the tenants they have no legs to stand 011. If other
co-ownen could not have dispossessed respondent No. I or demolished the
property without the consent of respondent No. 1 it is difficult to conceive
how their transferees could have demolished the tenancy premises and
H r<ii~ed their own construction over the land on which the tenancy premises
T. LAKSHMIPATHI v. P.N. REDDY [LAHOTI, J.] 177

stood earlier. (186-G, H; 187-D, El A
Jahuri Sah and Ors. v. Dwarika Prasad JhunjhunwaJa and Ors., I19661
Supp. SCR 280 and Vasudeo v. Balkishan, 120021 2 SCC 50, relied on.

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 4526 of I999.
B
From the Judgment and Order dated 2.12.1998 of the Andhra Pradesh
High Court in C.R.P. No. 3796 of 1998.

P.P. Rao, B.M. Rao, Ranjan Kr. Jha, G. Balaji and Ramesh Babu M.R.,
for the Appellant.

Uday U. Lalit and V.N. Raghupathy for the Respondents.
c
The Judgment of the Court was delivered by

R.C. LAHOTI, J. A decree for eviction passed in favour of the
respondent no. I on the grounds available under Section l 0(2)(i) and D
l0(3)(b)(iii) of A.P. Buildings (Lease, Rent & Eviction) Control Act, 1960
by the courts below and upheld by the High Court is under challenge in this
appeal by special leave, filed by the persons in occupation of the premises.
The facts of the case are complex and litigations between the parties are
multiple. It will be useful to notice in brief the several litigations between the
parties which will have an incidental bearing on the principal controversy E
and would enable precise appreciation of the facts.

The suit premises are non-residential bearing Door No.18-7-4 situated
in Ponniamman Koli Street of Chittoor town. This property was initially
owned by one P. Nayarana Reddy. In the year 1959 a suit was instituted for F
partition of certain joint family properties wherein the suit property was one
of the items. P. Narayana Reddy had two sons, namely, P. Nithyananda
Reddy, the respondent no. I and P. Manohar Reddy and five daughters. Late
P. Narayana Reddy, his wife and his two sons were arrayed as plaintiffs.
Partition of joint family properties was sought for from the other branch of
the family headed by brother of late P. Narayana Reddy. P. Narayana Reddy G
expired in the year 1981. By that time P. Manohar Reddy, the second son,
had pre-deceased the father. Five daughters and the widow of pre-deceased
son were·brought on record by way of substitution in place of late P. Narayana
Reddy and his wife who had also expired. A preliminary decree for partition
was passed. At one stage in the appeals pending against the preliminary
decree there was a compromise entered into by some of the parties in the year H
178 SUPREME COLRT REPORTS (2003] 3 S.C.R.

A 1983. The compromise had the effect of allotting the suit property to the
share of P. Nithyananda Reddy, the resr·ondent no. I. However, the compromise
decree was recalled and set aside on an application filed by some of the co-
sharers who were not joined as parties to the compromise. The appeal against
the preliminary d<~cree is still pending. Fmal decree in the partition suit is yet
B to be passed. Therefore, for all practical purpos~s though tbe shares of the
parties to partition stand declared by the decree of the trial court, the declaration
is still hanging fire in the pending appeal and partition by metes and bounds
is yet to take place.

Here it would be relevant to state that during the course of hearing in
C the present appeal before us, some controversy was sought to be raised as to
the extent of share to which P. Nithyananda Reddy, the respondent no. I,
would be entitled to in the suit premises. However, we are not concerned
with that controversy in the present appeal and leave the same to be adjudicated
upon in the partition suit and the pending appeal and proceedings subsequent
D thereto. For the purposes of the present appeal, we will proceed on an
assumption that P. Nithyananda Reddy, the respondent no. I, is a co-owner in
the suit premises and there are other co-owners as well; the exact extent or
proportion of co-ownership interests being irrelevant for the present
proceedings.

E Late P. Narayana Reddy had inducted a tenant in the suit premises,
namely, G. Ethirajulu, the respondent no.2. On the death of P. Narayana
Reddy in the year 1981, the tenant, G. Ethirajulu acknowledged P. Nithyananda
Reddy as landlord of the property and started paying rent solely to him. He
also paid Rs. 3000 by way of advance and incurred Rs. l 300 by way of
repairs which was adjusted in payment of rent for the period January 1982
F to April, 1984. Upto the end of April, 1985 the tenant G. lthirajulu went on
paying rent of the suit premises to P. Nithyananda Reddy, the respondent
no. I tre<iting him as landlord. Thereafter, P. Varadarajulu, the respondent
no.3, entered upon the scene. The respondent no.3 is the brother-in-law of
respondent no.2. The respondent no.3 claiming himself as tenant, tendered
G rent in April 1986 to the respondent no. I which he refused to receive on the
ground that the respondent no.3 had nothing to do with the suit property and
the respondent no. I did not recognize the respondent no.3 as tenant. Thereupon,
the respondent no.3 initiated proceedings under Section 8(5) of the Act seeking
pertnission to deposit rent in the Court on account of respondent no. I having
refused to receive the rent. In these proceedings the respondent no.3 claimed
H himself to be tenant and alleged and acknowledged the re_§pondent no. I to be
T. LAKSHMIPATHI v. P.N. REDDY [LAI-IOTI, J.] 179

the owner. Rent upto January 1990 was deposited in the proceedings under A
Section 8(5) of the Act. The proceedings came to be dismissed in default of
appearance of the applicant therein.

On 24.1.1990, the appellants no. 3 to 5 before us got a sale deed of the
suit premises executed in their favour from four daughters of P. Narayana
Reddy and the widow of pre-deceased son late Manohar Reddy.P. Nithyananda B
Reddy, the respondent no. I and his one sister, did not join in the execution
of sale deed and therefore their rights, to the extent they may be, do not stand
transferred to the appellants. P. Varadarajulu, respondent no.3 claims himself
to be the tenant in the suit premises, while according to respondent no. I, it
is the respondent no.2 who is the tenant and P. Varadarajulu was inducted C
illegally as a sub-tenant. The fact remains that subsequent to the execution
of the sale deed dated 24.1.1990 referred to hereinabove, P. Varadarajulu,
respondent no.3 has with the consent, express or implied, of G. lthirajulu,
respondent no.2, handed-over possession over the suit premises to the
appellants no. 3 to 5 here.in. The rights and interests of the respondents no.2
and 3, have come to vest in the appellants no. 3 to 5 apart from their being D
purchasers of interest of some of the co-owners of the joint property.

On. 26.3 .1990 the respondent no. I initiated the present proceedings for
eviction of the respondent nos. 2 and 3 (allegedly the tenant and the sub-
tenant) under Section 13 of the A.P. Buildings Control Act. It was alleged
that the respondent no. I required the premises bona fide for his own use and E
that the tenant was in arr.ears of rent and had also sub-let the premises parting
with possession in favour of a third person. In these proceedings the appellants
no. 3 to 5 herein sought for intervention and being joined as parties to the
proceedings. The prayer for impleadment was rejected by the learned Rent
·Controller vide his order dated 14.2, 1992. However, in revision preferred by F
the appellants no. 3 to 5, the prayer for their impleadment was allowed by
the High Court vide order dated 16.4.1992 in view of their having entered
into possession of the premises. On 17.7.1993 appellants nos. 3 to 5 transferred
their right and interest in the property along with possession in favour of the
appellant nos. I and 2 through a registered deed of sale. They were also
joined as parties and this is how the five appellants are parties to the eviction G
proceedings.

On I0.4.1990 the respondent no. I filed Original Suit No. 59 of 1990
seeking an injunction against the appell~nt nos. 3 to 5 restraining them for
interfering with the possession over the suit premises. The Trial Court granted H·
180 SUPREME COURT REPORTS [2003] 3 S.C.R.

A the temporary injunctioh. However, the Appellate Court, vide its order dated
l.10.1990 directed the injunction to be vacated recording a finding that the
appellant nos. 3 to 5 had entered into actual possession of the property in the
-
purported exercise of their title under the sale deed dated 24.1.1990, and
therefore the temporary preventive injunction against them was uncalled for.

B Reverting back to the present proceedings. the appellant nos. 3 to 5, on
having been joined as parties to the eviction proceedings, filed a written
statement on 12 ..7.1994, taking a plea that they were owners in possession of
the property and there was no landlord-tenant relationship between them and
the respondent no. I. On being joined as parties to the proceedings, the appellant
C nos. 1 and 2 also filed their written statement on 7.3.1996 raising a similar
plea.

On 12.3.1996 the Rent Controller directed the eviction petition to be
decreed. According to the Rent Controller the respondent no. I was landlord
of the suit premises and the respondent nos. 2 and 3 were the tenants having
D attorned in favour of respondent no. I, and· therefore, the persons inducted
into possession by them were also liable to be ~victed along with them. On
24.7.1998 the Principal SeniorCivil Judge dismissed the appeal, confirming
the order of the Rent Controller. The Civil Revision preferred before the
High Court also came to be dismissed on 2.12.1998. Two relevant facts may
be stated here by way of clarification. The judgment of the High Court
E records under a mistaken apprehension as to the facts either on the part of the
Court or on the part of the learned counsel for the appellants that the two sale
deeds executed respectively in favour of the appellant nos. 3 to 5 and then
appellant nos. I and 2 were unregistered and therefore did not have the effect
of transferring title to them. It was i:onceded at the Bar and very fairly by the
F learned counsel for both the parties before us that the sale deeds are in fact
registered and the statement of fact containeq in the judgment of the High
Court in that regard is incorrect. Both the learned counsels appearing before
us made their submissions proceeding on the foundation that the two sale
deeds are registered. The other point is that the only plea raised before the
High Court on behalf of the appellants was that they being transferees in
G possession from some of-the co-owners. they would also acquire the status
of co-owner and they can never be tenants of the respondent no. I who is just
one of the co-owners and, therefore, the eviction proceedings based on
landlord-tenant relationship are fundamentally misconceived and deserve to
be dismissed so far as they are concerned. The remedy of one co-owner
H against the other co-owner in possession is by way of suit for partition and
) .
T. LAKSHMIPATHI v. P.N. REDDY [LAHOTI, J.] 181
·- not by way of eviction. It is noteworthy that before the High Court no A
challenge was laid to the findings on the availability of the grounds of eviction
arrived at by the courts below. The result is that the finding as to availability
of grounds of eviction has achieved a finality and is immune from challenge
before ·this Court. Very fairly the learned senior counsel for the appellants
has not made any submissions in that regard. The cnntroversy surviving for
decision is as to the nature and character of possession of the appellants over B
the suit premises. If the appellants can be held to be co-owners in possession
of the property the suit for eviction would not lie, submits Shri P.P. Rao, the
learned senior counsel for the appellants. pn the contrary, the stand taken by
Shri Lalit, the learned counsel for the respondent no. I, is that the appellants
have been inducted into possession by the tenants in the suii property, without C
consent of the landlord-respondent no. I, and therefore, it is a clear case of
parting with possession by the tenant. The fact that the appellants have also
acquired title from some of the co-owners would not make any difference.
The respondent nos.2 and 3 have acknowledged and attomed the respondent
no.I as landlord of the property. They have not surrendered possession to the
respondent no. I. They have admittedly transferred possession to the appellant D
nos.3 to 5 who have in their tum transferred the possession to appellant nos.
I and 2. They are inducted into possession of the tenancy premises by the
tenants or the tenant and his sub-tenant. Simply because the appellants have
also acquired title of some of the co-owners it would not have the effect of
merging the tenancy with ownership and hringing the landlord-tenant E
relationship between the respondent no. I and respondent nos.2 and 3 to an
end so as to get rid of their obligation of placing the landlord in possession
of the tenancy premises on the tenancy coming to an end.

It is not disputed that the tenancy premises have been demolished and
new premises have been reconstructed in place of the old one by the transferees F
in connivance with the tenants.

We have set out the facts in brief incorporating the bare essential details
by way of backdrop. Certain neat questions of law arise for decision in this
appeal. For dealing with those questions, we sum up and set out as follows
the factual foundation on which we are now proceeding. Out of the several G
co-owners of the property, the respondent No. I was a landlord dealing with
the tenants as such and his landlordship was attorned to and acknowledged
by the tenants; the respondents No.2 and 3 shall both be treated as tenants,
!15 they themselves claim to be, without entering into the controversy whether
one of them is tenant and other is a sub-tenant or a person inducted in H
w
\

182 SUPREME COURT REPORTS [2003] 3 S.C. R.

A possession by the tenant; the tenants i.e. respondents No. 2 and 3 have parted
with possession in favour of the appellants without the consent, express or
-
implied, of the respondent no.1. who is landlord-cum-co-owner of the suit
premises; and the appellants being transferees from some of the co-owners of
the property, have acquired partia! proprietory interest (to the extent of the
B interest held by their predecessors in interest) in the suit premises. These
facts are beyond any pale of controversy so far as the present appeal is
concerned.

The first question which arises for decision is whether the appellants
are absolved of their obligation of delivering possession over the suit premises
C to the landlord-respondent No. I because the tenancy rights in the suit premises
held by respondents No.2 and 3 and transferred by them to the appellants
have merged in the ownership entailing determination of tenancy. The learned
senior counsel for the appellants has placed strong reliance on the doctrine
of merger.

D Law Lexicon (P. Ramanatha Aiyar, Second Edition, 1997) defines
"merger" as the ''"destruction or 'drowning' by operation of law of the less in
the greater of two estates coming together and vesting without any intervening r
estate in one and the same person in the same right." "Whenever a greater
estate and a less coincide and meet in one and the same person without any
intermediate estate, the less is immediately annihilated, or in the law phrase
E is said to be merged that is, sunk or drowned in the greater (2 Black. Com.177;
Tomlins Law Die.). According to Foa (General Law of Landlord and Tenant,
Eighth Edition, p.642), a lease may be determined by merger. A merger takes
place where a tenant acquires the irrmediate reversion: for when a greater
estate and a less coincide in the same person without any intermediate estate,
F the less is said to be merged in the greater ...... For merger, however, to
take place, the two interests must come to one and the same person in one
and the same right."

The common law doctrine of merger is statutorily embodied in Transfer
of Pruperty Act, 1882. Section 111 (1) provides:-"
G
111. Determination of lease. A lease of immovable property
determines

xxx xxx xxx xxx
(d) in case the interests of the lessee and the lessor in the whole
H
T. LAKSHMIPATHJ v. P.N. REDDY fLAHOTI, J.] 183

of the property become vested at the same time in one person in the A
same right;

xxx xxx xxx xxx"

A bare reading of the doctrine of merger, as statutorily recogni·zed in India,
contemplates (i) coalescence of the interest of the lessee and the interest of B
the lessor (ii) in the whole of the property (iii) at the same time (iv) in one
person (v) in the same right. There must be a coniplete union of the whole
interests of the lessor aild the lessee so as to enable the lesser interest of the
lessee sinking into the larger interest of the lessor in the reversion.

In Badri Narain Jhd and Ors. v. Rames/mar Dayal Singh and Ors., C
[1951) SCR 153, it \vas held by this Court that if the lessor purchases the
lessee's interest, the lease no doubt is extinguished as the same man cannot
at the same time be both a landlord and a tenant, but there is no extinction
of the lease if one of the several lessees purchased only a part of the lessor's
interest. In such a case the leasehold and the reversion cannot be said to
coincide. D

In Shaikh Faqir Bakhsh v. Murli Dhar and Ors., AIR (1931) PC 63, the
plaintiff was holding on lease a portion of the entire property. Subsequently,
plaintiff and defendant became pro indiviso joint proprietors of the property
by purchasing shares from the earlier owners. The lease was subsisting when E
the shares were bought by the parties. In a suit for accounts filed by the
plaintiff it was held that the plaintiffs rights under lease of a part do not
merge in his rights as joint proprietor of the whole of the property and as
between the parties the plaintiff held a valid and subsisting lease.

A Division Bench of Patna High Court in Parmeshwar Singh & Ors. F
v. Mt. Sureba Kuer and Ors., AfR (1925) Patna 530, held that Section 11 l(d)
applies only to a case where the interests of the lessee and of the lessor in
the whole of the property become vested at the same time in one person in
the same right. Where a co-proprietor in the property purchased for himself,
the interest of the lessees of the whole property, there could be no merger.
On purchase of a partial interest in tenancy rights by the o\vner, the onus of G
proving that the distinction between the interests conti~ued to be kept alive
subsequently also cannot be placed on the party alleging that the distinction
was so kept alive. To the same effect is the view of the law taken in Lala
Nathuni Prasad and Ors. v. Syed Aml'ar Karim and Ors., (1919) IC 16
(Patna). Merger is largely a question of intention, dependent on circumstances, H
l

184 SUPREME COURT REPORTS (2003 J 3 S.C.R.

A and the courts will presume against it when it operates to the disadvantage
of a party, as was held by this Court in Na!akath Sainuddin v. Koorikadan
Su/aiman, [2002] 6 SCC I (Para 20).

In the case at hand, it cannot be denied, nor has it been denied, that the
appellants herein are not purchasers of the entire ownership interest in the
B property. What they have purchased is interest of some out of all the co-
owners of the property. The interest of the respondent No. I, whatever be its
extent, has not come to vest in the appellants. The appellants have also
acquired the tenancy rights in the property. Thus they have acquired partial
ownership and foll tenancy rights. It cannot be said that the interests of the
C lessee and the lessor in the whole of the property have become vested in the
appellants at the same time and in th·~ same right. The lease cannot be said
to have been determined by merger. So long as the interests of the lessee, the
lesser estate and of the owner, the larger estate do not come to coalesce in
full either the water of larger estate is not deep enough to enable annihilation
or the body of lesser interest does not sink or drown fully.
D
It was submitted by the learned senior counsel for the appellants that
assuming if the tenancy has not determined by merger still what was held by
the respondents No.2 and 3 on tenancy was 'building' or super structure only
and not the land beneath. Admittedly, the building has been demolished. As
tenancy premises have ceased to exist, the tenancy has come to an end in
E view of the very subject matter of tenancy having ceased to exist. Assuming
also that the act of the appellants is wrongful still the remedy of the respondent
No. I who is only a co-owner in the prnperty would be to sue for partition
and seek recovery of damages; a suit based on landlord-tenant relationship
and seeking recovery of possession is misconceived and must fail. submitted
F the learned senior counsel Shri P.P. Rao.
The tenancy cannot be said to have been determined by attracting
applicability of the doctrine of frustration consequent upon demolishing of
the tenancy premises. Doctrine of frustration belongs to the realm of Law of
Contracts; it does not apply to a transaction where not only a privity of
G contract but a privily of est~te has also been created inasmuch as lease is the
transfer of an interest in ;rnrnovable property within the meaning of Section
5 of the Transfer of Property Act (wherein the phrase 'the transfer of property'
has been defined), reaJ with Section I05, which defi11es a lease of immovable
property as a transfer of a right to enjoy such property. (See observations of
H this Court in this regard in Raja Dhruv Dev Chand v. Raja Harmohinder
T. LAKSHMIPATHI v. P N REDDY [LAHOTI. .I.] 185

-
'
Singh and Anr .. [1968] 3 SCR 339. It is neither the case of the appellants nor
of the respondents No.2 and 3 that the subject matter of lease was the building
and the building alone. excluding land whereon the building fanning subject
A

matter of tenancy stood at the time of creation of lease.

In Woodfalrs Laws of Landlord and Tenant (18th. Edition, Vol.I) the
relevant law is so stated:- B
"Where the lessee covenants to pay rent at stated period (without
any exception in case of fire), he is bound to pay it, though the house
be burnt down: for the land remains, and he might have provided to
the contrary by express stipulation, if both parties had so intended. C
And this rule applies. although the lessee's covenant to repair contain
an exception in case of fire. Similarly. an action for use and occupation
still lies in respect of the whole period of the tenancy notwithstanding
the destruction of the premises by fire.'' (Para 1-0778)

"In a lease of land with buildings upon it the destruction of even
the entirety of the buildings does not affect the continuance of the D
lease or of the lessee's liabilities under it, unless so provided by
express contract." (Para 1-2055)

"A demise must have a subject-matter, either corporeal or
incorporeal. If the subject-matter is destroyed entirely, it is submitted F
that the lease comes automatically to an end. for there is no longer
any demise. The mere destruction of a building on land is not total
destruction of the subject-matter of a lease of the land and building.
so the demise continues. But if by some convulsion Gfnature the very
site ceases to exist. by being swallowed up altogether or buried in the
depths of the sea, it seems clear that any lease of the property must F
come to an end." (Para 1-2056)

A lease of a house or of a shop is a lease not only of the superstructure
but also of its site. It would be different if not only the site but al.~o the land
beneath ceases to exist by an act of nature. In the present case the appellants
who are the successors of the tenancy right have demolished the superstructure G
but the land beneath continues to exist. The entire tenancy premises have not
been lost. Moreover. the appellants cannot be permitted to take shelter behind
their own act prejudicial to the interest of the respondent No. I under whom
the respondents no.2 and 3 were holding as tenants and then inducted the
appellants.
H
186 SUPREME COURT REPORTS (2003) 3 S.C.R.

A In D.G. Gouse & Co. (Agenti) Pvt. Ltd. v. State of Kera/a and Anr.,
[l 980) 2 SCC 410, while dealing with Entry 49 of List II of the Seventh
Schedule of the Constitution, making a reference to Oxford English Dictionary,
this Court has held that the site of the building is a component part of the
building and therefore inheres in the concept or ordinary meaning of the
B expression 'building'. Referring to Corporation of the City of Victoria v.
Bishop of Vancouver Island, AIR (1921) PC 240, it was held that the word
'building' must receive its natural and ordinary meaning as 'including the
fabric of which it is composed, the ground upon which its walls stand and the
ground embraced within those walls".

C We are, therefore, of the opinion that in the event of the tenancy having
been created in respect of a building standing on the land, it is the building
and the land which are both components of subject matter of demise and the
destruction of the building alone does not determine the tenancy when the
land which was site of the building continues to exist; more so when the
building has been destroyed or demolished neither by the landlord nor by an
D act of nature but solely by the act of the tenant or the person claiming under
him. Ample judicial authority is available in support of this proposition and
illustratively we refer to George J. Ovunga/ v. Peter, AIR (1991) Kerala 55,
Rahim Bux and Ors. v. Mohammad Shafi, AIR (1971) Allahabad 16, Hind
Rubber Industries Pvt. Ltd. v. Tayebhai Mohammedbhai Bagasarwa//a &
E Ors., AIR ( 1996) Bombay 389 and Jiwan/al & Co. and Ors. v. Ma not & Co.,
ltd., 64 CWN 932. The Division Benc:h decision of Kerala High Court in Dr.
V. Sidharthan v. Pattiori Ramadasan, AIR (1984) Kerala 181, appears to
take a view to the contrary. But that was a case where the building was
totally destroyed by fire by negligence of the tenant. It is a case which
proceeds on very peculiar facts of its own and was rightly dissented from by
F Bombay High Court in Hind Rubber Industries Pvt. ltd. v. Tayebhai
Mohammedbhai Bagasarwa//a and Ors., (supra).

In the facts and circumstances of the case, no defence or shelter is
available to the appellants behind the plea that they have acquired interest of
some of the co-owners. The law as to co-owners is well settled. Where any
G property is held by several co-owners, each co-owner has interest in every
inch of the common property, but his interest is qualified and limited by
similar interest of the other co-owners. One co-owner cannot take exclusive
possession of the property nor commit an act of waste, ouster or illegitimate
use, and if he does so he may be restrained by an injunction. A co-owner
H may, by an arrangement, expressed or implied, with his other co-owners,
T. LAKSHMJPATHI v. P.N. REDDY [LAHOTI, J.] 187

possess and enjoy any property exclusively. Such a co-owner can also protect A
his possession against the other co-owners and if he is dispossessed by the
latter, he can recover exclusive possession. (See Jahuri Sah and Ors. v.
Dwarika Prasad Jhunjhunwala and Ors., [1966] Supp SCR 280. It is beyond
any controversy that on the death of late P. Narayana Reddy, his rights
devolved upon the several heirs including respondent no. I. The respondent B
no. I is the only male person in the body of the co-owners, all others being
women. It may be for this reason, or otherwise, that the respondent no. I was
in possession of the property, through tenants, realizing the rent peacefully
and with the consent, expressed or implied, of other co-heirs of late P.
Nithyananda Reddy. So far as the respondents no.2 and 3 are concerned, by
operation of Section 116 of the Evidence Act, they were estopped from C
challenging or denying the ownership of the respondent no. I and his rights
in the tenancy premises. As held in Vasudeo V. Balkishan, [2002] 2 sec 50.
·the rule of estoppel between landlord and tenant continues to operate so long
as the tenancy continues and unless the tenant has surrendered possession to
the landlord. The estoppel would cease to operate only on the tenant openly
restoring possession by surrender to the landlord. Neither the respondents no. D
2 and 3 nor their successors in interest or the persons claiming under them
could have-denied the title of the respondent no. I during the continuance of
the tenancy and even thereafter '1nless they had restored possession over the
tenancy premises to the respondent No. I. Looking at the status ofthe·appellants
whether as co-owners or as persons inducted in possession by the tenants E
they have no legs to stand on. If other co-owners could not have dispossessed
the respondent no. I or demolished the property without the consent of
respondent no. I it is difficult to conceive htiw their transferees could have
demolished the tenancy premises arid raised their own construction over the
land on which the tenancy premises stood earlier.
F
For the foregoing reasons, we find the appeal devoid of any merit and
liable to be dismissed. It is dismissed accordingly and with costs. The judgment
and decree of the Trial Court as upheld by the High Court are maintained.

S.K.S. Appeal dismissed.