PUNJAB NATIONAL BANK Vs. R R BHARDWAJ

JUDGEMENT

(1.) This judgment will dispose of above-mentioned two appeals arising out of common judgment and decree dated 13.5.2004 passed by District Judge, Ropar. Before the commencement of arguments, following substantial question of law has been framed by the appellant for consideration by this Court: "Where the lease deed is executed between the parties containing a covenant, for extension of lease deed for further period of plus five years, after the expiry of the initial period of lease, whether in that case after the expiry of initial period of lease, a fresh lease deed is mandatory to be executed and got registered or the period of lease deed will automatically be extended.

(2.) Briefly, the facts, as found by the courts below, are that the respondent is owner of SCO 16, Phase-I, Mohali. The demised premises was given on lease to the appellant (hereinafter described as 'the bank') vide registered lease deed dated 9.4.1996, effective from June, 1992. The lease was initially for a period of five years but extendable at the option of the lessee for other two terms of five years each on fulfilment of certain conditions. (It is not in dispute that the conditions laid down in the lease deed for extension thereof were duly fulfilled by the bank). The bank is in possession of the premises after expiry of initial period of five years and is continuously paying the lease rental agreed upon between the parties as payable during extended period of lease. The respondent filed two suits one for possession after ejecting the bank from the demised premises, five years period of lease having expired and there being no renewal thereafter and second for recovery of damages at the rate of Rs. 50,000/- per month from the date of termination of lease till the delivery of possession to the respondent along with interest at the rate of 12% per annum. It is not in dispute between the parties that after the expiry of the initial period of five years, no fresh lease deed was executed between the parties as the claim of the bank is that no fresh lease deed is required to be executed whereas the same is being disputed by the respondent.

(3.) The core issue on which both the parties have narrowed down and addressed the arguments is as to whether a fresh lease deed was required to be executed after the expiry of initial period of lease in spite of the fact that the lease deed contained a clause for extension of the lease at the option of the lessee in accordance with the covenant contained in the principal lease deed or no fresh lease deed was required to be executed.