' This revision is directed against the judgment and decree of the Vlth Additional District Judge, Karachi, dated 31-8-1982 whereby he dismissed the First Appeal No. 407 of 1981 of the applicant and confirmed the judgment and decree of XIIIth Civil Judge, Karachi, dated 11-11-1981.
2. The facts which give rise to this revision are that late Bakhtiar Ahmad Khan, predecessor-in- interest of the respondents was running a barber shop and a Hammam in Shop No. 2 on Plot No. 11 situated at Mama Dhobighat, near Shoe Market, Karachi. He was paying rent to the landlords for the last more than 25 years or so. The applicant approached the deceased Bakhtiar Ahmed to allow him to run the shop in his supervision and to use all articles and equipments affixed/lying thereon. The deceased Bakhtiar Ahmed permitted him to use the articles and assigned the same on a temporary Thekanama/licence on 20-8-1975 at Rs. 11 per diem. The said permission was extended from time to time upto 31-5-1978 and the amount was enhanced from Rs.11 to Rs.14 per diem. The said Bakhtiar Ahmed died on 30-1-1980. The respondents filed suit being Suit No. 2292 of 1980 for possession. The applicant also filed Suit No. 2641 of 1978 for a declaration and injunction against the said Bakhtiar Ahmed and after his death, the respondents were brought on record. The applicant averred in the plaint that he was tenant of the said Bakhtiar Ahmed. The Civil Judge, Karachi, consolidated both the suits and thereafter framed the following Issues:- "(1) Whether Muhammad Miskeen is a tenant or licensee in respect of disputed shop w.e.f. 28-8- 1975 and had taken over the shop with running business of Barber and Hammam on Theka?
(2) Whether the licence granted to Muhammad Miskeen expired on 31-5-1978 and was ever renewed thereafter?
(3) Whether Muhammad Miskeen is in unauthorised, illegal possession which amounts to encroachment and Trespass?
(4) Whether the defendants are themselves tenants are entitled for a decree of possession of the disputed premises?
(5) Whether any cause of action accrued to the plaintiff Muhammad Miskeen against the defendants?
(6) What should the decree be?
3. The applicant in support of his claim had examined himself and the respondent No. 1 examined herself and produced agreement dated 30-6-1977. The learned Civil Judge after recording the evidence of the parties and after hearing the learned counsel for the parties, decided the suits by his judgment dated 11-11-1981. The Suit No. 2641 of 1978 filed by the applicant was dismissed and the suit filed by the respondents was decreed with costs and the applicant was directed to vacate the shop within 15 days of the judgment. The learned trial Court held that the applicant was a licensee and he was authorised to run the barber shop and Hammam on payment of Rs. 14 per diem. The applicant being aggrieved preferred appeal being Civil Appeal No. 407 of 1981 against the judgment and decree dated 11-11-1981 before the Vlth Additional District Judge, Karachi. The learned VIth Additional District Judge after hearing the arguments- of the learned counsel for the parties dismissed the appeal by his judgment and decree dated 31-8-1982 and held that the applicant is not a tenant of the respondents but a mere licensee for running barber's shop.
' The applicant being aggrieved with the judgment and decree dated 31-8-1982 has preferred this revision on the grounds mentioned in the memo of revision.
4. Mr. Turab Ahmed the learned counsel for the applicant has contended that the applicant had claimed to be tenant and not a licensee and the agreement has not been correctly interpreted by the Courts below. He has also contended that the interpretation given by the Courts below to this agreement is contrary to the law, laid down by a Division Bench of this Court.
' On the other hand, Mr. Zahid Marghoob, the learned counsel for the respondents has contended that the Courts below have correctly interpreted the agreement.
5. The applicant examined himself as Exh. 5 and produced one witness Muhammad Fareed as Exh.
6 and he produced certified copies of application for seeking permission to deposit rent as Exh. 5 and the order passed thereon as Exh. 5/B. In rebuttal the respondent No. 1 was examined as Exh. 7 and she produced agreement dated 20-7-1977 as Exh. 8, and she also produced rent receipts issued by the landlords of the building. On the basis of the evidence the trial Court held that the applicant was not a tenant but only a licensee and the shop in question was given to him with the equipments for running the business of the barber and Hammam on daily payment of Rs.14. The trial Court was of the view that the agreement Exh. 8 was not a tenancy argeement but a licence.
The applicant stated that he had control of the shop and an .agreement of tenancy was executed between the parties. He further stated that he was made payment to the deceased Bakhtiar Ahmed, the appellant admitted in his cross-examination that deceased Bakhtiar Ahmed used to issue rent receipts but he could not produce the same. The witness Muhammad Fareed stated in his deposition that the agreement was executed in his presence and the rate of rent was agreed at Rs.320 per month and at the time of agreement it was barber shop. In rebuttal the respondent No. 1 stated that shop was given on daily contract of Rs.14. The shop was furnished for a barber shop.
She stated that the deceased let out to the applicant for running business of barber shop and a Hammam. It was suggested to her in cross-examination that the applicant was paying Rs.420 per month on account of rent which suggestion was denied by her. On the basis of the evidence on record the trial Court came to the conclusion that the applicant was not a tenant but only a licensee and the shop in question was given to him with the equipments only for running the business of the barber and Hammam on daily payment of Rs.14. The trial Court was of the view that the agreement dated 30-7-1977 was not a tenancy agreement. He, therefore, dismissed the suit filed by the applicant and the suit filed by the respondents was decreed. The learned appellate Court heard the arguments of the learned counsel for the parties and also perused the record of the case and came to the conclusion that the shop in question was let out to the applicant by the predecessor-in interest of the respondent alongwith allmost all the necessary equipments fitting and furniture for running barber shop and Hammam. The articles., equipments and furniture were not sold to the applicant but the entire premises including all fixtures and equipments was let out for running the business. The applicant could not produce any receipt even though he stated that the predecessor-in-interest of the respondent used to issue the rent receipts. The applicant claimed that he was in possession of the same which he could not produce as such the learned counsel for the respondents has contended that the trial Court drew the presumption against the applicant that if he had produced those rent receipts they would have gone against him.
6. Mr. Turab Ahmed the learned counsel for the applicant has referred to a case of Abdul Rehman v. Haji Mir Ahmed Khan PLD 1982 Kar.
532. The facts of this case are that the petitioner filed a Constitution petition challenging the order of the Rent Controller. The learned counsel for the petitioner contended that the language employed by the parties in the first agreement would seem to indicate that the parties wanted to avoid the incidence of the old Ordinance. The case is not applicable to the facts of this case as in the present case the question in the suit was whether the agreement Exh. 8 is a licence or a tenancy agreement. That point was not raised in the instant case as such the case does not help to the learned counsel for the applicant. Mr. Turab has also relied on a case of this Court decided by Zafar Hussain Mirza, J. (as then he was) in the case of Muhammad Owais v. Ziauddin, 1982 CLC 4 it was held as under: "The tenancy on monthly fortnightly, weekly or on daily one, the basis in which the period for rent is payable."
7. There is no quarrel for the above proposition of law. He has also relied on the case of Mst.
Noorunisa v. Abdus Salam PLD 1982 Pesh.
48. This case is also not helpful to the learned counsel for the applicant as the Court below have not misconstrued the agreement Exh. 8 nor the Courts below misread the evidence. The learned counsel for the .respondent has contended that the Court- below have carefully considered evidence of the parties and have not misconstrued the agreement Exh.
8.
' It is necessary in this connection to notice at the outset the distinction between a lease and a licence by reference to the relevant status. Section 2 (16) of the Stamp Act defined the lease as meaning a lease of immovable property but this definition it would be noted, is neither exhaustive nor self-explanatory. I am, therefore, driven to find out the true meaning of the terms by turning to transfer of Property Act, section 105 of the said act defies "lease" as follows:- "A lease of immovable property is a transfer of a right to enjoy such property, made for a certain time, express or implied or in perpetuity, in consideration of a price paid or promised or of money."
' Licence is defined in section 52 of the Easement Act, 1982 as under:- "Where one person grants to another, or to a definitely number of 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 does not amount to an easement or an interest in the property, the right is called a licence."
8. The expression immovable property is not defined in the Stamp Act but is defined in section 3 of the Transfer of the Property, Act, section 2(6) of the Registration Act and section 3(26) of the General Clauses Act.
' A close study of the above definitions shows that it is the creation of an interest in immovable property or a right to possess it that distinguishes a lease from a licence does not create interest in the property to which it relates while a lease does. There is in other words transfer of a right to enjoy the property in case of lease. As to whether a particular transaction creates a lease or licence is always a question of intention of parties which is to be inferred from circumstances of each case.
For the purpose of deciding whether a particular grant amounts to a lease or a licence it is, essential, therefore, look to the substance and essence of the agreement and not its form. I am fortified in this view by the decision of Supreme Court in the case of Abdullah Bhai and others v.
Ahmad Din PLD 1964 SC 106 "A lease as will appear from section 105 is a transfer of interest in immovable property. Ownership of physical property consists of a number of rights and the owner of such property when he creates a lease, transfers to the lessee a part of the right of ownership i.e. the right of enjoyment of the property for a period for consideration. During the continuance of the lease the right of enjoyment of the property belongs to the tenant and not to the landlord. The right of ownership as well as the right of which it is composed are right in rem and not in personem and by the lease a rights in rem is transferred to the lessee. On the other hand, a "licence" as will appear from its definition in section 52 of the Easement Act, 1882 is to be something which except for this permission would be unlawful. It does not confer any rights in physical property. There is in the case of a licence only a personal agreement between the licensor and the licensee whereby the licensor agrees not to interfere with doing of particular acts on property which is in his possession. The actual determination of the question whether an arrangement is a licence or lease, or transfer of lease, or sub-lease, often presents difficulties. The dividing line is clear though sometimes it becomes very thin or even blurred. At one time it was thought that the test of exclusive possession was infallible and if a person was given exclusive possession of the premises, it would conclusively establish that he was a lessee. But there was a change and the recent trend of judicial opinion is reflected in Errington v . Errington 1952 (1) A E R 149, wherein Lord Denning reviewing the case law on the subject summarises the result of his discussion thus at 155:- "The result of all these is that although a person who is let into exclusive possession in prima facie, to be considered to be tenant nevertheless he will not be held to be so if the circumstances negative any intention to create tenancy."
9. The Court of appeal again in Cebb v. Lane, 1952 (1) A E R 1199 considered the legal position and laid down that the intention of the parties was the real test for ascertaining the character of a document. At page 1201, Sommer Vell L. J--Stated ...."the solution that would seem to have been found is, as one would expect, that it must depend on the intention of the parties".
' Denning L.J.-- Said much to the same effect at page 1202.
"The question in all these cases is one of intention: Did the circumstances and the conduct of the parties show that all that was intended was that the occupier should have a personal privilege with no interest in the land?"
The following proposition may, therefore, to be taken a well-established (1) to ascertain whether a document creates a licenc or lease the substance of the document must be preferred to the form;
(2) the real test is the intention of the parties whether they intended to create a lease or a licence;
(3) if the document creates an interes in property, it is a lease, but if it only permits another to make us of the property, of which the legal possession continues with the owner it is a licence; and
(4) if under the document a party gets exclusive possession of the property prima facie he is considered to be a tenant, but circumstances may be established which negative the intention to create a lease".
10. The crucial test to be employed in cases of present nature can be gathered from the observations made by Lord Shaw while delivering the judgment of the Board in Kauri Timber Co.
Ltd. v. Commissioner of Tax 1913 A C'771 (776). According to those observations, in order that an agreement can be said to partake of the character of lease, it is necessary that the grantee should have obtained an interest in land then to use the words of Lord Coleridge, C.J., in Marshall v. Green (1975) 1 C P D 35 the land would be considered as a mere warehouse of the thing sold and the contract would be contract for goods.
11. For the purposes, therefore, of ascertaining the intention of the parties and finding out the character of the agreement in question, it is necessary to notice the salient feature of the agreement. The first feature of the agreement (Exh.8). The first salient feature of the agreement is that applicant shall run the business of barber shop and Hammam. The second salient feature of the agreement Exh.8 is that he will pay Rs.14 per diem to the respondent and in default the grantor is entitled to get it vacated. The third salient feature of agreement Exh.8 is that this licence is valid for the period of eleven months and the fourth salient feature is that the furniture and fixtures shall remain in trust and the licensee shall be responsible for breakage. I am of the view that Exh.8 possessed the characteristic of licence and did not amount to lease of the barber shop and a Hammam and the applicant was not granted exclusive possession and control of the shop but merely granted the right of carrying on the business and to run the furnished barber shop and a Hammam and to carry on the business of barber shop but merely the right of running the furnished shop. The distinction between licensee and tenancy is one of substance, as remarked by the learned Courts below, or to put it more precisely, one of intention. Under different circumstances, exclusive possession with payment may amount to licence or tenancy.
12. In the instance case, the applicant, on the evidence, appears to have been allowed to carry on the business of barber shop and Hammam on payment of Rs.14 per diem.
13. The learned Courts below have also discussed the other circumstances, which are more consistent with a case of defendant/ applicant's licence then with a case of tenancy in his favour.
14. In my view, the learned Courts below, on the above state of the record, were justified to hold that the applicant/defendant was a licensee in respect of the disputed shop and a Hammam.
15. I am unable to say that in taking the above view the learned Court below made a wrong approach or suffered from any error. In this view, the defendant's/applicant's possession would be that of a licence, where licensee has been terminated by efflux of time. lt, further appears from the evidence before the Court, which has been accepted by the learned Courts below, and from their view on the point, I am not inclined to differ.
In view of this the revision is dismissed with costs and the judgment and decree of the Courts below are confirmed.