The General Secretary, Vivekananda Kendra v. Pradeep Kumar Agarwalla & Ors

 A 99-year registered instrument using the language of demise and exclusive enjoyment constitutes a lease, not a licence; unilateral cancellation by the lessor is illegal.

Background

Late Anima Bose executed a registered 99-year instrument dated 23.03.1998 (Ext.1) in favour of Vivekananda Kendra concerning the plaint schedule property. In 2003, she unilaterally cancelled the instrument and later, through her power of attorney holder, sold the property to Respondents 3 and 4 (2006).

The plaintiff sought declaration of leasehold rights, invalidation of cancellation and sale, recovery of possession, and injunction. The Trial Court and First Appellate Court decreed the suit. The High Court, in second appeal under s. 100 CPC, held Ext.1 to be a licence and dismissed the suit.

Issues Framed

  1. Whether Ext.1 dated 23.03.1998 is a lease under s. 105 Transfer of Property Act, 1882 (TPA) or a licence under s. 52 Easements Act, 1882.
  2. Whether unilateral cancellation of the instrument was valid.

Court’s Reasoning

1. Test for Lease vs Licence

Relying on Associated Hotels of India Ltd. v. R.N. Kapoor (AIR 1959 SC 1262) , the Court reiterated:

  • Substance prevails over form.
  • Real test is intention of parties.
  • Transfer of interest with right to exclusive enjoyment indicates lease.

Construction principles:

  • Begin with literal rule;
  • Avoid purposive/external aids unless ambiguity exists.

2. Construction of Ext.1

Key clauses:

  • Use of “demises to the Lessee”.
  • 99-year term with annual rent of Rs. 1,000.
  • Right to construct and alter buildings.
  • Lessee’s rights extended to heirs and assigns.

These clauses unequivocally created a transferable interest and satisfied s. 105 TPA.

The High Court erred in relying on ex post facto conduct. Retention of first-floor occupation by the lessor did not negate lease; exclusive possession is assessed vis-à-vis the demised portion.

3. Effect of Unilateral Cancellation

In absence of a cancellation clause and absent grounds under s. 111 TPA, unilateral cancellation was illegal.

Purchasers derive no better title than the lessor; their rights remain subject to the subsisting lease.

Decision / Disposition

  • High Court judgment set aside.
  • Decree of Trial Court and First Appellate Court restored.
  • Civil Appeal allowed; no costs.

Ratio

Where a registered instrument uses clear language of demise for a fixed term with rent and confers exclusive enjoyment and transferable rights, it constitutes a lease under s. 105 TPA; unilateral cancellation by the lessor, absent contractual or statutory basis under s. 111 TPA, is illegal.

Case Details

Citation: 2026 INSC 199
Decided on: 26 February 2026
Case Title: The General Secretary, Vivekananda Kendra v. Pradeep Kumar Agarwalla & Ors.
Court: Supreme Court of India
Bench: Pankaj Mithal, J.; S.V.N. Bhatti, J.

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