Hindustan Paper Corporation v. Kanta Manocha

1. The appeal impugns the judgment and decree (dated 20th September, 2003 of the Court of the Additional District Judge, Delhi in Suit NO. 179/2001 filed by the respondent) of recovery of mesne profits/damages for use and occupation against the appellant.

2. Notice of the appeal was issued and the trial court record requisitioned. Vide ex parte ad interim order dated 12th November, 2003, subject to the appellant depositing the entire decretal amount with interest in this Court, the attachment order in execution issued by the Trial Court was stayed. The appeal was on 9th December, 2003 admitted for hearing. The appellant in pursuance to the ad interim order deposited an amount of Rs. 12,67,415/- in this Court. Vide order dated 9th December, 2003 the said 2013:DHC:5423 amount was permitted to be withdrawn by the respondent subject to furnishing the security. The amount was so withdrawn by the respondent /decree holder against the bank guarantee which has been renewed from time to time. The appeal was on 29th January, 2013 dismissed in default of appearance of the appellant and the bank guarantee furnished by the respondent /plaintiff was discharged. However on application for restoration being filed by the appellant, the appeal as well as the bank guarantee were restored to original position. The counsels have been heard and the trial court record perused.

3. The undisputed facts are – i. that the appellant was a tenant under the respondent/landlord with respect to the two and a half storied property No.E-525, Greater Kailash-II, New Delhi constructed over a plot of land admeasuring 500 sq. yds. and comprising of a drawing cum dining room, three bed rooms with attached bathrooms on each of the ground and the first floors and a barsati with attached bath on the second floor, besides car garage, two servant quarters, lounge, courtyard, drive way, etc; ii. that the property was initially let out to the appellant on 18th January, 1982 at a rent of Rs.6500/- per month for a period of five years; iii. that though the said period of five years expired on 18th January, 1987 but the appellant failed to vacate the premises, perhaps taking advantage of the protection from eviction then available under the Delhi Rent Control Act, 1958; iv. that however after the amendment w.e.f. 1st December, 1988 of the Rent Act, making the provisions thereof inapplicable to premises the rent whereof was in excess of Rs.3500/- per month, the respondent/landlord in or about the year 1991 filed a suit for ejectment of the appellant; v. however the said suit was dismissed on 13th July, 1998 holding the notice of determination of tenancy to be not in accordance with law; vi. that the respondent/landlord, after again terminating the tenancy of the appellant, in or about the year 1999 instituted the suit from which this appeal arises, again for ejectment and mesne profits; vii. that vide order dated 10th September, 2001 in the said suit, the application of the respondent/landlord under Order 12 Rule 6 of the CPC was allowed and an order of ejectment of the appellant made and inquiry into mesne profits ordered; viii. that the respondent/landlord applied for execution of the order of the ejectment and during the said execution proceedings the appellant/defendant sought time till 31st March, 2002 to vacate the property and agreed to pay a sum of Rs.50,000/- per month to the respondent/landlord for the said period.

4. The learned Additional District Judge, vide the impugned judgment, has awarded mesne profits/damages for use and occupation to the respondent/landlord @ Rs.50,000/- per month from 18th April, 1999 i.e. from which date the tenancy of the appellant was terminated and till the vacation of the premises on 31st March, 2002, less the amounts already paid, finding, observing, holding – a. that the Executive (Commercial) of the appellant appearing as a witness had deposed that the property was being used as the guest house of the appellant company and was in a dilapidated condition and the appellant was last paying a sum of Rs.9350/per month therefor and the prevalent market rent thereof could not have been more; b. that a real estate agent examined by the appellant/defendant had also deposed that the market rent of the property for the period between 1999-2002 could not be in excess of Rs.9000/per month; c. that the witness of the respondent/landlord had proved that after vacation by the appellant, the property had been let out at a rent of Rs.60,000/- per month.

5. The counsel for the appellant has argued –

I. that the learned Additional District Judge erred in holding that the subject property after vacation of the appellant had been let out at a rent of Rs.60,000/- per month when no registered lease deed was filed and only Memorandum of Understanding (MoU) showing the said rent was tendered into evidence;

III. that there was no material cross examination of the witness of the appellant who had deposed of the property being in dilapidated condition and not in a condition of fetching more than Rs.9000/per month;

IV. relying on National Radio & Electronic Co. Ltd. Vs. Motion Pictures Association 2005(122) DLT 629 it is contended that no judicial notice of prevalent rent can be taken and judicial notice only of rise in rent can be taken;

V. reliance is placed on Hindustan Photofilms Manufacturing Co. Ltd. Vs. Anu Enterprises 2010(174) DLT 171 to contend that no cognizance of photocopy of a document can be taken;

VI. relying on Printers House Pvt. Ltd. Vs. Mst. Saiyadan (deceased) by Lrs (1994) 2 SCC 133 it is contended that the respondent/landlord without leading evidence of comparable premises fetching rent as claimed of Rs.50,000/- per month, could not have been awarded mesne profit at the said rate.

6. The counsel for the respondent/landlord at the outset, to satisfy the judicial conscience of this Court, has handed over a copy of the registered lease deed in pursuance of the MoU earlier executed, showing the property to have in fact been let out w.e.f. 1st September, 2002 at a rent of Rs.60,000/- per month. He has further argued a. that though the appellant was liable to be ejected much earlier but owing to the dismissal of the suit for ejectment earlier filed by the respondent/landlord on the technicality of defective termination, the claim of the respondent / landlord for mesne profits has been restricted only from 18th April, 1999; b. that the appellant having agreed to pay Rs.50,000/- per month for a period of three months sought by it to vacate the premises, is itself an indication of the same being the market value of the premises; a copy of the order dated 20th December, 2001 in this regard in the proceedings for execution of the ejectment order was handed over; c. that the MoU has been proved by the signatory thereof i.e, the attorney of the respondent/landlord; d. attention is also invited to the cross examination by the respondent/landlord of the witness of the appellant to controvert that he was not cross examined; e. that the colony in which the property is situated is one of the posh colonies of Delhi and for this reason alone the decree ought not to be interfered with.

7. The counsel for the appellant in rejoinder has argued that no evidence of any other letting in the vicinity has been led.

8. I have considered the rival contentions and am not inclined to interfere with the decree for the following reasons-

I. that adverse inference has to be drawn against the appellant that had the appellant disclosed the rent of the alternative accommodation, it would have become apparent that the claim of the respondent/landlord for mesne profits at the rate of Rs.50,000/- per month for a much larger accommodation and in a elite colony was justified;