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<h1>Supreme Court clarifies lease vs. license distinction in compromise decree interpretation</h1> The Supreme Court ruled in an appeal case concerning the interpretation of a compromise decree, determining whether it constituted a lease or a license. ... - Issues:1. Interpretation of compromise decree - lease or licence.Analysis:The Supreme Court heard an appeal challenging the High Court of Orissa's judgment, which set aside the District Judge's order affirming the dismissal of an application under Section 47, Civil Procedure Code. The dispute arose from a compromise decree between the decree-holder and the judgment-debtor, determining whether it created a lease or licence. The High Court held it was a lease, granting protection under the Orissa House-Rent Control Act.The appellant argued that the decree-holder's intention was not to create a tenancy but to provide accommodation, citing relevant case law. The Supreme Court referred to established principles distinguishing between lease and licence. It emphasized that the decisive factor is the parties' intention, considering all provisions in the agreement.The Court analyzed the terms of the compromise, noting the use of the word 'rent' and the payment made as a deposit. However, crucial was Clause (d), allowing execution if rent was not paid for three consecutive months. This provision indicated the parties did not intend to establish a landlord-tenant relationship. The Court referenced previous judgments highlighting the significance of such clauses in determining the nature of the agreement.Despite the High Court's emphasis on the extended possession period granted to the judgment debtor, the Supreme Court held that the duration did not alter the nature of the compromise. Ultimately, the Court concluded that the compromise did not create a lease, thereby excluding the judgment-debtor from the Act's tenant definition. The appeal was allowed, setting aside the High Court's judgment and restoring the District Judge's decision, with costs awarded to the appellants.
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