Tenancy rights cannot be bequeathed in breach of contract: HC

In a ruling expected to have far-reaching effects on transfer of tenancy rights, Justice Gauri Godse observed that the bequest of tenancy rights made through the will was in breach of a contract between the tenant and the landlord

MUMBAI: The Bombay High Court on Monday set aside a 2009 order of the City Civil Court by which the niece of a deceased Parsi doctor continued to live in his flat in Churchgate, claiming that the tenancy rights of the flat, owned by the Life Insurance Corporation of India (LIC), were bequeathed to her in the doctor’s will.

Mumbai, India - Nov. 4, 2025: Queen Court at Churchgate in Mumbai, India, on Tuesday, November 4, 2025. (Photo by Anshuman Poyrekar/Hindustan Times) (Anshuman Poyrekar/HT Photo)

In a ruling expected to have far-reaching effects on transfer of tenancy rights, Justice Gauri Godse observed that the bequest of tenancy rights made through the will was in breach of a contract between the tenant and the landlord. If tenancy rights are passed on through such bequests, property could be transferred to a complete stranger, the court cautioned.

The court was hearing a case pertaining to a 2,000-sq flat and garage in Queen’s Court building near the Oval Maidan leased by LIC to Dr Darasahah Bharucha on May 19, 1986. The tenancy rights of his deceased wife Tehmina were transferred to Dr Bharucha. Nilofer Marshall, the daughter of Bharucha’s cousin, had claimed that she had been living with the deceased in the flat since 1980. After Dr Bharucha’s death on September 11, 1994, she continued to live there and even paid the rent until 1997.

On January 25, 1997, LIC issued termination notices with regard to Dr Bharucha’s tenancy to his legal heirs including Marshall. The LIC had filed an application under the Public Premises (Eviction of Unauthorised Occupants) Act, 1971, following which the Estate Officer, a statutory authority, issued notices to Dr Bharucha’s legal heirs.

Marshall claimed that Bharucha, in his will probated on September 3, 1984, had bequeathed the flat to her and she had thus become the tenant of the flat.

On May 29, 2008, the Estate Officer, however, held that Marshall was never recognised as a tenant by the LIC and asked her to vacate. The City Civil Court set aside the Estate Officer’s decision on May 2, 2009, after which LIC moved the high court the same year.

The LIC had said that in the agreement, in 1986, Dr Bharucha had said nobody other than him lived in the flat. The agreement also stated that the doctor would not sub-let or part with possession of the flat, without prior written consent of LIC.

LIC’s counsel V Y Sanglikar and lawyers Roopadaksha Basu and Heenal Wadhwa argued that Bharucha could not have passed on his tenancy to Marshall by executing a will without its consent as there was a contractual prohibition against it. Justice Godse said the authority to occupy the flat was granted solely to Dr Bharucha and it ended with his death.

Representing Marshall, senior counsel Haresh Jagtiani argued that she had claimed tenancy “as transmitted by testamentary bequest’ and she was a “contractual tenant”. He said that in the agreement between Dr Bharucha and LIC, there was no bar on transmission of the tenancy through a will. Marshall stated that even if she was not a close relative of Bharucha or a ‘Class-1 heir’, she was a legatee under his will. The court, however, said there was “no substance” in these contentions.

Jagtiani said the high court had granted an eight-week stay on the order, and that the court’s decision will be challenged in the Supreme Court.