Registered Instruments of Tenancy

Harshad Govardhan Sondagar v. International Asset Reconstruction Co. Ltd., (2014) 6 SCC 1 has categorically held, if the tenancy claim is for any term exceeding one year, the tenancy can be made only by a registered instrument. Three-­Judge Bench of this Court in Bajarang Shyamsunder Agarwal v. Central Bank of India, (2019) 9 SCC 94 has held, if a valid tenancy under law is in existence even prior to the creation of the mortgage, such tenant’s possession cannot be disturbed by the secured creditor by taking possession of the property. If a tenancy under law comes into existence after the creation of a mortgage but prior to issuance of a notice under Section 13(2) of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 it has to satisfy the conditions of Section 65­A of The Transfer of Property Act, 1882. If a tenant claims, he is entitled to possession of a secured asset for a term of more than a year, it has to be supported by the execution of a registered instrument. In the absence of a registered instrument, if the tenant only relies upon an unregistered instrument or an oral agreement accompanied by delivery of possession, the tenant is not entitled to possession of the secured asset for more than the period prescribed under the provisions of The Transfer of Property Act, 1882.

In the present case, there is a serious doubt as to the bona fide of the tenant as there is no good or sufficient evidence to establish the tenancy.

Hon’ble Justice S. Abdul Nazeer, Hemraj Ratnakar Salian v. HDFC Bank Ltd., [Criminal Appeal No. 843844 of 2021].