The Calcutta High Court has upheld an eviction decree passed against Budge Budge Company Limited, bringing an end to a prolonged tenancy dispute with The Calcutta Gujrati Education Society. A Division Bench ruled that the tenant's occupation after the termination of a fresh month-to-month tenancy could not continue in law and found no reason to interfere with the trial court's findings.
Background of the Case
The dispute arose from a lease agreement executed on October 29, 1973, under which Budge Budge Company Limited occupied the premises owned by The Calcutta Gujrati Education Society. An earlier eviction suit filed in 1992 under the West Bengal Premises Tenancy Act was later withdrawn.
Following the withdrawal, the landlord accepted rent for a few months and subsequently issued a fresh notice dated July 5, 2003 under Section 106 of the Transfer of Property Act, 1882, terminating what it claimed had become a fresh month-to-month tenancy. When the company did not vacate the premises, a fresh suit for eviction and recovery of possession was filed before the High Court on its Original Side.
The trial court decreed the suit in December 2024, directing the company to hand over vacant possession and holding the landlord entitled to mesne profits. Budge Budge Company challenged that decree before the Division Bench.
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Tenant's Arguments Before the High Court
The appellant argued that its tenancy could be terminated only in the event of default in payment of rent and that it had not defaulted until August 2003. It further contended that acceptance of rent by the landlord after the earlier proceedings amounted to renewal of tenancy and waiver of the eviction notice.
The company also argued that the second eviction suit was not maintainable because the earlier suit had revived after an order of the High Court, resulting in two proceedings over the same property. It additionally questioned the jurisdiction of the trial court, contending that the dispute should have been treated as a commercial dispute after the enactment of the Commercial Courts Act, 2015.
Court's Observations
The Division Bench agreed with the trial court that once the earlier tenancy had ended and the landlord accepted rent, a fresh tenancy by holding over came into existence under Section 116 of the Transfer of Property Act. That renewed tenancy was validly terminated through the notice dated July 5, 2003.
The Bench observed that the second eviction suit was founded on a new cause of action, making it distinct from the earlier proceedings.
"The instant suit is based on determination of that tenancy. This cause of action is, of course, not the earlier cause of action. It is a different cause of action,"
the court noted while approving the trial court's reasoning.
The court also rejected the contention that acceptance of rent after issuance of the second notice amounted to waiver of the notice to quit.
Referring to settled Supreme Court precedents, the Bench observed that,
"mere acceptance of rent after service of notice to quit... does not establish such intent or is tantamount to express or implied waiver of notice."
It found that payments made during the pendency of litigation were accepted without prejudice to the parties' rights and therefore did not revive the tenancy.
On the objection regarding the Commercial Courts Act, the High Court held that the suit had been instituted in 2003, well before the Commercial Courts Act came into force in 2015. It noted that the proceedings had substantially progressed by then and no objection regarding jurisdiction had been raised during the trial.
The Bench held that no prejudice had been demonstrated by the appellant and observed that the later enactment of the Commercial Courts Act could not retrospectively invalidate a decree passed by a competent civil court.
Decision
Finding no legal or factual error in the trial court's judgment, the Division Bench affirmed the decree directing Budge Budge Company Limited to vacate the premises. The appeal, APD 4 of 2025, was dismissed along with all connected applications.
Case Details:
Case Title: Budge Budge Company Limited v. The Calcutta Gujrati Education Society & Anr.
Case Number: APD 04 of 2025 (with CS No. 317 of 2003)
Judge: Justice Md. Shabbar Rashidi and Justice Debangsu Basak
Decision Date: 02 July 2026
