Full Text
HIGH COURT OF DELHI
CM(M) 277/2019 and CM 7800/2019 (stay)
CHANDER PRAKESH GUPTA ..... Petitioner
Through: Mr. Vivek Naryan Sharma, Mr. Ashim Shedha, Advs.
Through: Mr. Sandeep Kapoor and Mr. Sunil Satyarthi, Advs. with Respondent 2 in person
JUDGMENT
24.11.2022
1. In CS 10084/2016, instituted by the respondents against the petitioner, the learned Additional District Judge (“the learned ADJ”) vide order dated 9th October 2017, passed under Order XV-A of the Code of Civil Procedure, 1908 (CPC), as applicable to Delhi, directed the petitioner, as the defendant in suit, to pay arrears of rent/mesne profits, from the date of filing of the suit till the date of the order i.e., 9th October 2017, @ ₹ 50,000/- per month and to pay future mesne profit/damages w.e.f November 2017 onwards, at the same rate of ₹ 50,000/- per month. An application filed by the petitioner, under Section 114 of the CPC, seeking review of the said order dated 9th October 2017, was dismissed by the learned ADJ vide order dated 24th December 2018.
2. Both these applications have been called into question by the petitioner-defendant, in the present petition, instituted under Article 227 of the Constitution of India. Facts and impugned orders The suit
3. CS(OS) 2227/2013, which was the number under which CS 10084/2016 was originally registered when filed before this Court prior to enhancement of pecuniary jurisdiction of the learned Trial Courts, asserted that the petitioner had entered into a lease agreement dated 16th December 2008 with Respondent 1 Kamlesh Wadhwa in respect of the suit property situated at D-5, Ground Floor, Amar Colony, Lajpat Nagar-IV, New Delhi-110024, of which Respondents 2 and 3, the sons of Kamlesh Wadhwa, were co-owners.
4. The property was stated to have been leased to the petitioner for running a fitness centre. As per the lease agreement, the petitioner was to pay rent @ ₹ 40,000/- per month to the respondents. The lease was for a duration of 22 months, to end on 2nd October 2010. This period was, by mutual agreement, extended for a period of 11 months. The plaint asserted that the petitioner had agreed to pay rent, in respect of the suit property, @ ₹ 50,000/- per month w.e.f. 3rd October 2010.
5. The plaint further drew attention to para 17 of the lease agreement, whereunder, on expiry/termination of the lease, the petitioner was required to pay pre-determined liquidated damages @ ₹ 3,000/- per day, in addition to rent. Default was to entitle the respondents to enter and take over the suit property and to result in ipso facto cancellation of the lease agreement.
6. Para 5 of the plaint acknowledged the fact that, apart from the aforesaid transactions relatable to the lease agreement, certain other transactions by cheque and cash, including transactions relating to certain amounts borrowed by the respondents from the petitioner from time to time, also took place. These, however, it was asserted, were identifiable as separate receipts were issued in that regard. Para 5 of the plaint, which so averred, reads thus:
7. The plaint alleged that, using blank signed papers which Respondent 1 had, in good faith, given to the petitioner, a forged and fabricated agreement to sell dated 5th October 2010 was created by the petitioner, in respect of the suit property. The plaint categorically denied Respondent 1 having ever entered into any such agreement, with the petitioner, to sell the suit property.
8. Arrears of rent, allegedly payable by the petitioner to the respondents, it was alleged, had accumulated to ₹ 22,45,000/-. The plaint further alleged that, w.e.f. 5th March 2011, petitioner suddenly discontinued payment of rent to the respondents, despite several requests by the respondents in that regard. Finally, the petitioner was alleged to have issued three cheques dated 26th June 2013, 28th June 2013 and 27th June 2013 for ₹ 3 lakhs, ₹ 3 lakhs and ₹ 5 lakhs each, all of which were dishonoured on presentation, resulting in the respondents instituting proceedings against the petitioner under Section 138 of the Negotiable Instrument Act, 1881.
9. In these circumstances, averred the plaint, the respondents served, on the petitioner, a legal notice dated 26th August 2013, calling on the petitioner to hand over vacant and peaceful possession of the suit property. The notice also claimed damages and mesne profits.
10. The petitioner having failed to hand over possession of the suit property, the respondents instituted the afore-noted CS 2227/2013 before this Court, seeking decrees (i) for recovery of peaceful and vacation possession of the suit property, (ii) for payment of arrears of rent of ₹ 8,84,000/- with pendente lite and future interest till the date of realisation in favour of the respondents and against the petitioner, and (iii) of recovery of penalty/mesne profits to the extent of ₹ 22,45,000/- along with mesne profits @ ₹ 3,000/- per day for the period 3rd October 2011 to 2nd October 2013 with future mesne profits calculated at the same rate. Written statement of the petitioner
11. The petitioner, in his written statement filed by way of response to the suit instituted by the respondents, acknowledged the registered lease agreement dated 16th December 2008, whereunder the petitioner was leased the suit property for twenty two months commencing 3rd December 2008 @ ₹ 40,000/- per month. Having so acknowledged the lease agreement, the petitioner, however, claimed that he had paid, to the respondents, the following amounts: (i) ₹ 26 lakhs as security deposit, as mentioned in the lease deed, on 16th December 2008 and (ii) ₹ 10 lakhs by way of loan on 2nd January 2009. It was further averred, in the written statement, that on their financial conditions becoming more straitened, the respondents offered to sell the first floor of the suit property to the petitioner, following which, in November 2009, Respondents 2 and 3 executed an agreement, with the petitioner, to sell the first floor for a total consideration of ₹ 67,75,000/-. Advance payment of ₹ 3 lakhs was alleged to have been made by the petitioner to the respondents in that regard. The written statement also referred to further payments between the parties. It was sought to be asserted, in the written statement, that, by agreement, the monthly rent payable by the petitioner to the respondents was adjusted against the aforesaid amounts loaned by the former to the latter.
12. On the respondents allegedly failing to execute the sale deed in respect of the first floor of the suit property, as required by the agreement to sell dated 5th October 2010, the petitioner instituted CS(OS) 1836/2013 before this Court, seeking specific performance thereof.
13. Mr. Vivek Narayan Sharma, learned Counsel for the petitioner, emphasized, in this context, the following order dated 24th February 2015, passed by a learned Single Judge of this Court in CS 1836/2013: “Plaintiff is directed to pay the admitted balance sale consideration according to him to the defendants by way of demand draft within a period of four weeks. Needless to say, the aforesaid payment shall be without prejudice to the rights and contentions of either of the parties. List the matter for consideration on 24th July, 2015. ”
14. In these circumstances, the petitioner prayed, vide the written statement, that the suit instituted by the respondents be dismissed with costs.
15. During the course of proceedings in the suit, the respondentplaintiff moved an application under Section 151 of the CPC, seeking a direction to the petitioner to pay monthly rent/mesne profits, as well as arrears due since March 2011. It may noted, here, that though the application was instituted by the respondents under Section 151 of the CPC, the learned ADJ treated it as an application under Order XV-A of the CPC.
16. Learned counsel for the petitioner did not join issue therewith. The impugned order dated 9th October 2017
17. The petitioner contended, before the learned ADJ, that it had been agreed, between the petitioner and the respondents, that the amounts of loan taken by the respondents from the petitioner from time to time would be adjusted against the total consideration for sale of the first floor of the suit property, which was in the region of ₹ 90 lakhs. Inasmuch as the petitioner was continuing in possession of the suit property after paying the entire consideration as envisaged by the agreement to sell dated 5th October 2010, the petitioner contended that his status had changed from that of a tenant to that of a buyer of the suit property. In such circumstances, the petitioner contended that he was not liable to pay any further rent or mesne profits, for which purpose he relied on the judgment of a Division Bench of this Court in Shiv Kumar v. Sumit Gulati 1.
18. Responding to the said contention of the petitioner, the respondents, as the applicants, disputed the petitioner’s contention that there had been a change in his status vis-a-vis the respondents in respect of the suit. In this context, the respondents emphasized the fact that the agreement to sell dated 5th October 2010 was unregistered and further pointed out that the agreement itself envisaged delivery of possession of the suit property to the petitioner at the time of final payment. The assertion of the petitioner that he had made complete payment as envisaged by the agreement to sell was denied.
19. Having thus noted the contentions of both sides, the learned ADJ proceeded to observe and hold as under:
20. The petitioner moved an application under Section 114 of the CPC, before the leaned ADJ, seeking a review of the impugned order dated 9th October 2017. It was sought to be contended, in the application, that the order dated 9th October 2017 suffered from an error apparent from the face of the record, as it failed to take into account the fact that the entire sale consideration of ₹ 90 lakhs, envisaged in the agreement to sell dated 5th October 2010, stood paid by the petitioner to the respondents. Of this amount, the petitioner sought to contend that ₹ 12,60,000/- had been paid to the respondents pursuant to, and in terms of, the order dated 24th February 2015 supra, passed by this Court in CS(OS) 1836/2013. The fact that the entire sale consideration stood paid by the petitioner to the respondents, it was submitted, also stood reflected in the order dated 8th April 2016 passed by the learned Metropolitan Magistrate in Criminal Case 1110/2015 instituted by Respondent 2 against the petitioner under Section 138 of the Negotiable Instruments Act.
21. Once, thus, agreement to sell stood executed and the entire sale consideration envisaged therein stood paid by the petitioner to the respondents, the petitioner, it was sought to be submitted, was not required to pay any further rent or mesne profits to continue in possession of the suit property. For this purpose, reliance was placed on the judgment of this Court in Dr. Shiv Pal Jindal v. Friedrich Ebert Stiftung[2].
22. The submissions of the petitioner stand rejected and the review application of the petitioner stands dismissed, by the learned ADJ, vide paras 11, 12, 16, 17, 18 and 19 of the impugned order dated 24th December 2018, which read thus:
17. Another ground taken by petitioner is ratio of case titled as Shiv Kumar Vs. Sumit Gulati as discussed in order dated 09.10.2017 cannot be relied upon in facts and circumstances of present case since defendant is not claiming possession of suit property U/sec 53 A of Transfer of Property Act, 1882. This court relied upon ratio in the said judgment and did not merely consider applicability of judgment of Hon'ble High Court of Delhi from point of view of Section 53A of Transfer of Property Act. Hence, this contention of petitioner is rejected.
18. It is contended that agreement to sell dated 05.10.2010 nowhere suggests that possession was to be delivered to the defendant in part performance of the contract to sell the suit property. It is contended that agreement to sell dated 05.10.2010 was clearly not in nature of Section 53A of Transfer of Property Act and therefore jural relationship between plaintiffs and defendant is that of vendor /seller and purchaser /buyer and not of landlord and tenant. Perusal of copy of agreement to sell dated 05.10.2010 filed by defendant on record vide clause 2 clearly stipulates that the first party will deliver actual, physical possession alongwith all connected documents of the said portion to the second party at the time of final payment meaning thereby that possession of suit property still remained to be handed over by plaintiffs to defendant even as per document relied upon by defendant and status of possession of defendant in these circumstances cannot be but considered to be that of landlord and tenant i.e. the capacity wherein defendant firstly came into possession of suit property.
19. In view of my above-made discussion, I am of the view that petitioner /defendant has not been able to make out any case for review of order dated 09.10.2017. Application of petitioner /defendant for review is therefore dismissed.
23. Aggrieved by the aforesaid orders, the petitioner is, as already noted, before this Court under Article 227 of the Constitution of India.
24. I have heard Vivek Narayan Sharma, learned Counsel for the petitioner and Mr. Sandeep Kapoor, learned Counsel for the respondent, at length.
25. Mr. Sharma, learned Counsel for the petitioner, broadly reiterated the contentions advanced by the petitioner before the learned ADJ. He contended, placing especial reliance on Shiv Pal Jindal[2] that as the entire sale consideration envisaged by the agreement to sell dated November 2009 stood paid by the petitioner to the respondents, the petitioner was not required to pay any further amount to the respondents, to continue to remain in possession of the suit property. He has placed reliance on the order dated 24th February 2015 passed by this Court in CS (OS) 1836/2013, extracted in para 13 supra.
26. He has emphasised the words “admitted balance sale consideration” in the said order, and contended that, once the balance sale consideration thus stood paid by the petitioner to the respondents, the covenants of the agreement to sell stood completely satisfied.
27. The agreement to sell dated 5th October 2010 has been placed on record by the petitioner. The opening covenants of the agreement to sell are significant and read thus: “This Agreement is executed at New Delhi, on 05.10.2010 between (1) Smt. Kamlesh Wadhwa W/o Late Shri Chetan Wadhwa, (2) Mr. Rohit Wadhwa, (3) Mr. Sumit Wadhwa, both sons of Late Sh. Chetan Wadhwa all R/o D-5, Amar Colony, Lajpat Nagar-IV, New Delhi-110024, hereinafter called the FIRST PARTY. AND Mr. Chander Prakash Gupta S/o Late Shri. R.L.Gupta, R/o TA-279/5, Tughlakabad Extension, Kalkaji, New Delhi, hereinafter called the SECOND PARTY. The expression First Party and Second Party shall mean and include their respective heirs, successors, executors, legal representatives, administrators and assignees.
WHEREAS the first party is the owner of Entire Ground Floor without terrace rights, a part of freehold property bearing no. D-5, Amar Colony, Lajpat Nagar-IV, New Delhi-110024, with the proportionate rights of the land under the said property. And whereas the first party for their bonafide need and requirements have agreed to sell Entire First Floor without terrace rights, a part of freehold property bearing no. D-5, built on land measuring 100 sq. yards, situated at Amar Colony, Lajpat Nagar-IV, New Delhi-110024, with the proportionate rights of the land under the said property, hereinafter called the PORTION UNDER SALE, to the second party, for a total sum of ₹ 90,00,000/- (Rupees Ninety Lac Only), out of which the first party has received sum of ₹ 30,00,000/-(Rupees Thirty Lacs Only) in the following manner:- ₹ 1,00,000/- vide cheque no. 572043, dt. 13.11.2009, ₹ 2,00,000/- vide cheque no. 571712, dt. 04.2.2010, favouring Kamlesh Wadhwa, ₹ 3,00,000/- vide cheque no. 571713, dt. 04.2.2010, favouring Rohit Wadhwa, ₹3,00,000/- vide cheque no. 571714, dt. 04.2.2010, favouring Sumit Wadhwa All drawn on ICICI Bank, New Delhi, ₹ 21,00,000/- in Cash from the second party as an earnest money and the second party will pay balance amount of ₹ 60,00,000/- (Rupees Sixty Lacs Only) to the first party within Eighteen Months, from the date of signing of this Agreement i.e. or before 04.04.2012 on the following terms and conditions of this agreement as under:...”
28. Clearly, the agreement to sell envisaged the total sale consideration of the first floor of the suit property as being ₹ 90,00,000/-, out of which, till the date of execution of the agreement to sell, ₹ 30,00,000/- had been received by the petitioner. The balance amount of ₹ 60,00,000/- was required to be paid on or before 4th April
2012.
29. Even if the stipulated cut-off date of 4th April 2012 was to be deemed to stand extended by operation of the order dated 24th February 2015 supra, passed by this Court in CS 1836/2013, the petitioner would, nonetheless, have to establish that, in terms of the agreement to sell, the balance sale consideration of ₹ 60,00,000/- had been paid by the petitioner to the respondents.
30. I am in agreement with the learned ADJ in her observation that the order dated 24th February 2015 supra passed by this Court in CS 1836/2013, even if complied with, would not necessarily manifest or evidence complete payment of the consideration envisaged under the agreement to sell by the petitioner to the respondents. For one, the order refers to the “admitted” balance sale consideration. The order cannot, therefore, be read as according, by this Court, of its imprimatur to the remaining payment which the petitioner would make to the respondents as reflecting the actual balance sale consideration payable under the agreement to sell. To make matters clearer, the order proceeds to observe that the direction for balance payment was without prejudice to the rights and contentions of the parties.
31. The reliance, by the petitioner, on the order dated 24th February 2015 supra, passed by this Court, is, therefore, misguided.
32. Nonetheless, in order to satisfy myself, I queried, of learned Counsel for the petitioner, as to when, and in what mode and manner, the remaining amount of ₹ 60 lakhs, as contemplated by the agreement to sell, had been paid by the petitioner to the respondents. His response was revealing.
33. The amount of ₹ 60 lakhs, contends Mr. Sharma, stood liquidated by way of (i) ₹ 1 lakh interest free security deposit made on 11th June 2007, (ii) ₹ 25 lakhs interest free security deposit made on 16th December 2008, (iii) ₹ 10 lakhs borrowed by the respondents from the petitioner on 2nd January 2009, (iv) cash payment of ₹ 2 lakhs made on 13th November 2009, (v) ₹ 2 lakhs paid by the petitioner to the respondents on 27th July 2011, (vi) ₹ 1 lakh paid by the petitioner to the respondents on 20th August 2011 (vii) ₹ 1.[9] lakhs paid by the petitioner to the respondents on 24th January 2012 and (viii) ₹ 2.[5] lakhs paid by the petitioner to the respondents on 17th February 2012, of which the last four payments do not form part of the record, apart from a further payment of ₹ 20 lakhs.
34. It is clear that these payments cannot be treated as liquidating the liability of ₹ 60 lakhs envisaged in the agreement to sell. If anything, a substantial part of the payment was made prior to the execution of the agreement to sell.
35. The judgment in Shiv Pal Jindal[2] cannot, therefore, be of any assistance to the petitioner, as that was a case in which the Division Bench of this Court noted, even within the first four paras of the report, that, of the total sale consideration payable in respect of the property forming subject matter of dispute in that case, of ₹ 2.[3] crores, ₹ 1 lakh was given to the proposed seller at the time of execution of the agreement to sell on 1st November 2004 and the entire balance of ₹ 2.29 crores was paid by the purported purchaser to the vendor on 28th February 2005. The Division Bench, therefore, takes care to observe, in para 5 of the report, thus:
36. As against this, and as the learned ADJ has correctly observed, there is no clear material on record to indicate that, in terms of the agreement to sell, complete consideration stands paid by the petitioner to the respondents.
37. The sole ground on which the petitioner sought review of the order dated 9th October 2017, passed by the learned ADJ was, therefore, bereft of merit.
38. Once the petitioner is thus found ineligible for the benefit of the law laid down in Dr. Shiv Pal Jindal[2], the inexorable consequences of order XV-A of the CPC have necessary to visit the petitioner.
39. Order XV-A of the CPC reads thus: “(1) In any suit by a owner/lessor for eviction of an unauthorized occupant/lessee or for the recovery of rent and future mesne profits from him, the defendant shall deposit such amount as the court may direct on account of arrears upto the date of the order (within such time as the court may fix) and thereafter continue to deposit in each succeeding month the rent claimed in the suit as the court may direct. The defendant shall continue to deposit such amount till the decision of the suit unless otherwise directed. In the event of any default in making the deposit as aforesaid, the Court may subject to the provisions of sub-rule (2) strike off the defence.”
40. The power conferred on the Court under Order XV-A is fundamentally discretionary in nature. The court is empowered, under the said provision, in any suit by a lessor for eviction of a lessee or for recovery of rent and future mesne profits from a lessee, to direct the lessee to make deposit towards arrears upto the date of the order and, thereafter, to continue to deposit, each month, the rent claimed in the suit. The rent claimed in the suit, in the present case, was ₹ 50,000/per month.
41. There was no substantial contest, on that aspect, by the petitioner, who merely sought to pitch his case on the agreement to sell.
42. The learned ADJ has, therefore, in accordance with the Order XV-A of the CPC, directed the petitioner to pay outstanding arrears of rent as well as monthly rent in future @ ₹ 50,000/- per month.
43. I may note, here, that there was no contest, by Mr. Sharma, to the quantum of deposit or rent that the impugned order directs the petitioner to pay.
44. The impugned order, therefore, conforms to the statute. There is no infirmity therein.
45. In that view of the matter, there is no substance in the present petition which is accordingly dismissed with no order as to costs.
C.HARI SHANKAR, J. NOVEMBER 24, 2022