ORDER
E. Padmanabhan, J.
1. The defendant, who has been unsuccessful before the two courts below, is the appellant. The respondent herein is the owner of the suit property, which consists of two godowns and adjacent land, instituted the suit praying for judgment and decree directing the defendant to vacate the suit property after removing the additional unauthorised constructions put up by the defendant and put the plaintiff in possession of the suit property. The ownership of the suit property is not being disputed. It is also admitted that the defendant was inducted as a tenant in the suit property. The defendant has raised controversy in the suit claiming that the tenancy is for agricultural purpose, it is an annual lease and hence the notice of termination issued by the plaintiff is invalid and hence the suit is not maintainable.
2. In this Appeal this Court has to decide as to whether the concurrent findings of the two courts below holding that there has been a valid notice of termination and the decree passed on that basis is valid or not.
3. The respondent herein as plaintiff instituted the suit against the appellant herein, pleading that the appellant is a tenant of the suit property, which consists of land and two godowns, that the tenant agreed to pay a rent of Rs. 125 per month, that the suit property is required for the purpose of the plaintiff's society, that a notice of termination was issued on 5.7.82, terminating the tenancy by the end of 31st August, 1982, that the tenancy is monthly and that the defendant who had been evasive should be directed to remove the sheds put up by it unauthorisedly and deliver the vacant possession of the suit property. It has also been pleaded that the provisions of Tamil Nadu Buildings (Lease and Rent Control) Act, 1960, has no application to the premises, with respect to which there is no controversy.
4. The appellant herein as defendant filed a written statement contending that the notice to quit is neither proper nor valid as the lease being annual. The appellant also contended that the rent has been fixed and was being paid annually, that it had constructed two godowns at its own costs and the defendant is not liable to be evicted and that it is not true to say that the defendant has undertaken to remove the buildings at the time of vacating the property.
5. Before the trial court, the plaintiff marked Ex.A-1 and A-2, while the defendant marked Ex.B-1 to B-7. The plaintiff examined P.W.1., while the defendant had also examined D.W.1.
6. The trial court framed three issues. On the second issue, relating to arrears of rent, the trial court rendered a finding that the plaintiff had not established that the defendant was in arrears of rent. On issues 1 and 3, the trial court found that there is valid notice of termination and that the plaintiff is entitled to a decree as prayed for directing the defendant to surrender possession after removing the constructions put up by the defendant. The trial court held that the notice of termination issued Under Section 106 of The Transfer of Property Act is valid.
7. On appeal by the defendant, the first appellate court also confirmed that there has been a valid notice of termination and the first appellate court confirmed the decree passed by the trial court. Aggrieved by the said judgments and decree of the two courts below, the present second appeal has been preferred.
8. At the time of admission, this court framed the following substantial question of law:
(a) whether the suit filed by the respondent is liable to be dismissed for want of proper notice to quit under the Transfer of Property Act?
9. The point that has to be decided by this Court is, as to whether the notice of termination issued by the plaintiff is valid or not? Whether the judgment of the courts before are liable to be interfered?
10. It is admitted that there is no registered document of lease or anyother document or correspondence, from which the terms of lease could be found. The plaintiff claims that the monthly rent is Rs. 125 per month and the tenancy is monthly and it is for the purpose of storage of paddy by the defendant Corporation. On the other hand the defendant contended that it is annual lease, the lease is for agricultural purpose and that the notice of termination is invalid.
11. It is to be pointed out that it is not as if the suit premises was let out for manufacturing purpose or for agricultural purpose, as is being contended by the defendant in the suit. Admittedly the defendant has taken the property on lease for the purpose of storing paddy, procured by it at various centres and sheds were used as a transit shed to store paddy, procured by it. The procured paddy from the various centres is brought to the godowns, stored in the suit property and from there it is forwarded to various other centres. It is not as if the defendant utilised the property for the purpose of manufacturing or for the purpose of agriculture. Admittedly, the defendant is not carrying on agricultural operation not it is engaged in agriculture. It procures paddy as a wholesales and thereafter stores a portion of the paddy, procured by it in the suit property and use the suit property as a transit place, for repacking or drying, during rainy season, when the moisture contents of the paddy so procured by it was found to be on the higher side.
12. Merely because a drier is located to dry paddy, it cannot be assumed that the defendant is using the premises for manufacturing and it cannot also be assumed that the suit premises is used for agricultural purpose. Despite, such factual position as spoken by P.W.1 as admitted by D.W.1., the learned counsel for the appellant sought to contend that even in this second appeal, that the premises was let for agricultural purpose and as such the lease being annual, the notice of termination is invalid.
13. The two courts below on a consideration of evidence rendered a definite finding that in the absence of any document of lease, the tenancy is monthly, it was neither for agricultural purpose nor for manufacturing purpose and that the notice of termination is valid. This finding of the fact rendered by the courts below in my view, has to be accepted and no interference is called for on the findings recorded, sitting in second appeal.
14. The learned counsel for the appellant vehemently contended that there is no valid termination notice, as according to the appellant, the tenancy is for agricultural purpose and hence it is annual and therefore the notice issued by the plaintiff is invalid.
15. On the other hand the learned counsel for the respondent pointed out that the two courts below have concurrently found that the tenancy is monthly and it is neither for agricultural purpose nor for manufacturing purpose and further contended that no interference is called for with respect to the findings rendered and the decrees passed by the Courts below.
16. The learned counsel for the respondent placed reliance upon the judgment of the Supreme Court reported in Ram Kumar Das v. Jagdish Chandra Deo, and judgment of this court reported in Vital Vel Press v. Sri Ranganathaswamy Temple, 1996 (1) L.W. 602.
17. The appellant in my considered view, has not made out a case for interference, however, for the limited purpose of deciding as to whether the notice of termination is valid or not, the law laid down by the Apex Court and this Court has to be referred.
18. In Idandas v. Anant Ramchandra Phadke, , the Apex Court has held that the burden of proving whether the purpose of lease is for manufacturing purpose would be on the defendant and the Supreme Court has also laid down the test for determining as to whether the lease in question is for manufacturing purpose or not? It has been held thus:-
"Coming now to the tests laid down by this Court the position may be summarised as follows:-
1. That it must be proved that a certain commodity was produced;
2. That the process of production must involve either labour or machinery;
3. That the end product which comes into existence after the manufacturing process is complete, should have a different name and should be put to a different use. In other words, the commodity should be so transformed so as to lose its original character.
In the instant case what happened was that wheat was transformed, by the manufacturing process which involved both labour and machinery, into flour. The commodity before manufacture was wheat which could not be consumed by any human being but would be used only for catties or medicine or other similar purposes. The end product would be flour which was fit for human consumption and is used by all persons and its complexion has been completely changed. The name of the commodity after the product came into existence is atta and not gehun (wheat). Thus in the instant case all the three tests have been fully satisfied. This being the position the irresistible inference and the inescapable conclusion would be that the present lease was one for manufacturing purposes. In this view of the matter, the notice of one month must be held to be invalid and suit for rejectment should have failed on that ground."
19. In Allenbuty Engineers Private Ltd., v. Shri. Ram Krishna Dalmia and Ors., , the law on the subject has been analysed by the Apex court and it has been held thus:-
"The expression 'manufacturing purposes' in Section 106 is used in its popular and dictionary meaning, the Transfer of Property Act not having supplied any dictionary of its own for that expression. The burden of proving that the lease was for manufacturing purposes, must for the purposes of Section 106 of the Transfer of Property Act, lie on the party who claims it to be so, in the present case the appellant-company. That burden is to establish that the exclusive or at least the dominant purpose of the lease was the manufacturing purpose. (see C. Mackertich v. Steuart and Co., Ltd., ).
X X X X ...
"The expression 'manufacturing purposes' in Section 106, thus, means purposes for making or fabricating articles or materials by physical labour, or skill, or by mechanical power, vendible and useful as such. Such making or fabricating does not mean merely a change in an already existing article or material, but transforming it into a different article or material having a distinctive name, character or use or fabricating a previously known article by a novel process.
20. The lease is whether for manufacturing purpose or for agricultural purpose has to be decided as on the date when the defendant had taken the premises on lease and subsequent events even if there is change in user, there is no avail to determine the purpose of lease. In the present case it has already been found by the two courts below that the defendant Corporation procured paddy, stored it and if necessary dries it and repacks it and so the defendant used the suit property for the purpose of storing paddy procured by it and forwards the paddy so procured to various mills or to other godowns for storage. This factual aspect as found by the courts below has to be accepted. The defendant not being an agricultural undertaking and not engaged in manufacturing as has been laid down by the Supreme Court in Idandas v. Anant Ramachandra Phadke, , this Court has to reject the contention put forward by the counsel for the appellant and has to confirm that the lease is question is monthly and it is neither for agricultural purpose nor for manufacturing purpose nor it had undertaken manufacture of any product on the suit property.
21. The two courts below have rightly presumed that in the absence of any lease deed or any other document to prove the terms of tenancy and had held that the lease is monthly. In this respect the pronouncement of the Supreme Court reported in Ram Kumar Das v. Jagdish Chandra Deo, , has been rightly relied upon by the learned counsel for the respondent. It has been held thus:-
"It is not disputed that the contract to the contrary, as contemplated by Section 106 T.P.Act, need not be an express contract; it may be implied, but it certainly should be a valid contract. If it is no contract in law, the section will be operative and regulate the duration of the lease. It has no doubt been recognised in several cases that the mode in which a rent is expressed to be payable affords a presumption that the tenancy was an annual tenancy unless there is something to rebut the presumption. But the difficulty in applying this rule to the present case arises from the fact that a tenancy from year to year or reserving a yearly rent can be made only by registered instrument, as laid down in Section 107, T.P.Act. The Kabuliyat in the case before us is undoubtedly a registered instrument, but ex concesis it is not an operative document at all and cannot consequently fulfil the requirements of Section 107, T.P.Act."
22. The entire case law on the subject has been considered by S.S. Subramani, J., reported in Vital Vel Press v. Sri Ranganathaswamy Temple, 1996 (1) L.W 602. The learned Judge following the law laid down by the Supreme Court in Allenbury Engineers (Pvt) Ltd., v. Shri Ram Krishna Dalmia, had occassion to consider the
expression "Manufacturing purposes" appearing in Section 106 of the Transfer of Property Act and it has been held thus:-
"What is meant by 'manufacturing purpose is discussed in the Transfer of Property Act by Mulla in 'The Transfer of Property Act', Eighth Edition (1995) at page 812. The learned author says that the phrase 'manufacturing purpose' is used in its popular sense and means the making of articles of trade and commerce by means of machinery. At page 813, the learned author further says, "The expression 'manufacturing purpose' is used in its popular dictionary meaning and there must be such a transformation in the material that a new and different article having a distinctive name, character or use emerges. The learned author has relied on certain decisions for the said purpose. In Allenbury Engineers (Pvt) Ltd., v. Shri Ram Krishna Dalmia, their Lordships said that the
burden of proving that the lease was for manufacturing purpose, for the purpose of Section 106 of the Transfer of Property Act, lies on the party who claims it to be so. The burden is to establish that the exclusive or at least dominant purpose of the lease was 'manufacturing purpose'. In paragraph 8 of the judgment their Lordships considered as to what is meant by 'manufacture'. The ordinary dictionary meaning was accepted wherein it is said that manufacture means making of articles or materials by physical labour or mechanical power. Their Lordships further said that the expression 'manufacturing purpose' in Section 106 of the Transfer of Property Act means purposes for making or fabricating articles or materials by physical labour, or skill, or by mechanical power, vendible and useful as such. Such making or fabricating does not mean merely a change in an already existing article or material, but transforming it into a different article or material having a distinctive name, character or fabricating a previously known article by a novel process."
23. In this very some decision, S.S. Subramani, J., also has held that in the absence of written lease agreement, it can only be taken that the tenancy is only monthly and the rent is fixed per month, though the amount is paid annually. It would not make the lease as annual as contended by the learned counsel for the appellant in this appeal. This court respectfully agrees with the law laid down by S.S. Subramani, J.
24. On a consideration of the pleading, evidence, both oral and documentary, the findings of the two courts below that there is a valid termination of tenancy is therefore confirmed and the Second Appeal is dismissed with cost of Rs. 2,000 Rupees two thousand only to the respondent.
25. Earlier order passed by this Court in C.M.P.No. 4682 of 1996 dated 23.8.96 will hold good and the plaintiff in the suit will be entitled to enforce the said order and recover the amount directed to be paid by the defendant Corporation by execution of the said order and this position is not disputed by the learned counsel for appellant. Consequently, C.M.P.No. 2760 of 1997 is dismissed.