Lease construction and temporary ownership division determined that the Rent Act applied and civil court jurisdiction was excluded.

On a true construction of the lease and agreement to lease, a lessee who was to erect and complete the building at its own expense retained ownership of the structure during the term under Section 108(h) of the Transfer of Property Act, absent a contrary contract. A clause requiring delivery of the premises and erections on termination did not transfer present ownership to the lessor. The Court held that ownership may be divided for a limited period where one party has dominion, control, and risk, and on that basis the premises belonged to the lessee, not the local authority, for purposes of sub-tenancies. The premises were therefore not excluded by Section 4(1) of the Bombay Rent Act, and the civil court lacked jurisdiction.

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Issues: Whether, on a true construction of the lease documents, the premises let under the 99-year arrangement belonged to the local authority so as to attract the exemption under Section 4(1) of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947, and whether the civil court therefore lacked jurisdiction.

Analysis: Under Section 108(h) of the Transfer of Property Act, 1882, a lessee who erects a structure on leased land may, in the absence of contract to the contrary, retain ownership of the structure. The agreement to lease and the lease showed that the building was to be erected at the lessee's expense, completed by him, and dealt with as the subject of possession and control during the currency of the term. The provision requiring delivery of the premises and erections on termination did not transfer present ownership to the lessor. The Court further held that ownership may be divided for a limited period, and that a person with full dominion and control and the attendant risk may be treated as owner for that period. On that construction, the premises, as between the lessee and its sub-tenants, belonged to the lessee and not to the local authority.

Conclusion: The premises were not excluded by Section 4(1), the Rent Act applied, and the High Court had no jurisdiction to try the suits.

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