Translate
Text Highlighter

Bookmark

PDF

Share

Report a problem
AMICUS AI
Citation Codes
Equivalent Citations
citation codes
Case Number
Attorney(S)
Judges
Are you a practicing lawyer?
Enhance your digital presence and reach by creating a Casemine profile.
Upload pleading to use the new AI search
Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Attorney(S)
Judges
Smart Summary

Factual and Procedural Background

The plaintiff let out tenanted premises to Defendant No. 4, a company associated with Defendants No. 2 and 5, on 19 June 1974 at a monthly rent of Rs. 6,000. Subsequently, Defendant No. 1 was accepted as tenant on the same terms. Defendant No. 2, who mostly owned Defendant No. 1, resided in the premises with family members. On 12 December 1988, the plaintiff served a notice terminating the tenancy, demanding possession by the end of the month. The plaintiff filed a suit for possession on 10 March 1989 and claimed mesne profits at the market rate of Rs. 50,000 per month after the tenancy termination and expiry of the notice period. Defendants 4 and 5 filed a written statement (W/S) in March 1990, claiming tenancy had been transferred to Defendant No. 1 and disavowing interest. Defendants 1 to 3 delayed filing their W/S until 17 August 1990, after which their defense was struck out. They appealed to the Division Bench and filed W/S to inform the court, which was accepted with heavy costs. The defendants contended that the amended Rent Act exemption for premises with rent above Rs. 3,500 was unconstitutional; that Defendant No. 1 was not the sole tenant but several associated companies were tenants paying less than Rs. 3,500 rent through Defendant No. 1; and that the termination notice was invalid as the premises were used for manufacturing processes. A Director of Defendant No. 1 testified that Defendant No. 1 alone was tenant, with the ground floor used for residence and upper floor for office. The court found no manufacturing process was involved, held the termination notice valid, and recognized only Defendants 1 and 2 as tenants and prosecuted by the DDA for misuse.

Legal Issues Presented

  1. At what rate should damages/mesne profits be granted to the plaintiffs following termination of the tenancy?
  2. Whether Defendants 1 to 3 are jointly and severally liable for damages/mesne profits?
  3. Whether the defendants are liable to pay lawful charges levied by the Land & Development Officer for breaches of lease conditions due to misuse of the premises?
  4. Whether the plaintiff is entitled to a decree for possession of the property?
  5. Whether a permanent injunction restraining the defendants from using the property for non-residential purposes is warranted?

Arguments of the Parties

Plaintiff's Arguments

  • Claimed mesne profits at Rs. 50,000 per month based on the market rate after tenancy termination.
  • Asserted right to possession following expiry of termination notice.
  • Claimed defendants liable for all lawful charges payable to the Land & Development Officer due to misuse of premises.

Defendants' Arguments

  • Contended the amended Rent Act exemption for premises with rent above Rs. 3,500 was unconstitutional.
  • Asserted Defendant No. 1 was not the sole tenant; multiple associated companies were tenants paying less than Rs. 3,500 through Defendant No. 1.
  • Challenged the validity of the termination notice, claiming the premises were used for manufacturing processes.
  • Denied liability for mesne profits jointly and severally.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The court considered the plaintiffs’ claim for mesne profits at Rs. 50,000 per month but noted the absence of evidence supporting this figure. Recognizing the significant rise in rents since the original rent fixation in 1974, the court took judicial notice of the rent increase in the relevant area and fixed a fair mesne profit at Rs. 10,000 per month from 19 January 1989 until possession was handed over. Regarding joint and several liability, the court found Defendant No. 1’s liability undisputed and held Defendants 2 and 3 liable as they resided in the premises and benefited from occupation. The corporate veil was pierced, given Defendant No. 1 was largely owned by Defendants 2 and 3. On the issue of misuse, the court held that defendants were liable to pay lawful charges levied by the Land & Development Officer due to breaches of lease conditions. The court found no manufacturing use of the premises, validating the termination notice. Consequently, the court decreed possession in favor of the plaintiff and granted a permanent injunction restraining defendants from using the property for non-residential purposes until possession was delivered.

Holding and Implications

The suit of the plaintiffs is decreed. A decree for possession of the property is granted in favor of the plaintiffs and against Defendants 1 to 3. Defendants 1 to 3 are held jointly and severally liable to pay damages/mesne profits at Rs. 10,000 per month from 19 January 1989 until vacant possession is delivered. The decree is subject to the plaintiffs paying the requisite court fee on the amount due, and defendants are entitled to adjust any prior payments made. Additionally, a permanent injunction restrains defendants from using the property for any purpose other than residential until possession is handed over. Defendants are also liable jointly and severally for all lawful charges payable to the Land & Development Officer on account of misuse of the premises, subject to court fee payment by plaintiffs and without prejudice to defendants’ rights to legally challenge such demands. The plaintiffs are entitled to costs as per rules.

The decision directly affects the parties by confirming possession and financial liabilities but does not establish new legal precedent.

    Bakshi Sachdev (D) v. Concord (I)

    (1) [ED. facts.: Plaintiff had let out tenanted premises to Deft. no. 4, a company of Defts. 2 and 5 on 19 6.74 @ Rs. 6000.00 p.m. After a few months Deft. no. 1 was accepted as tenant on same terms. Deft. no. 1 was mostly owned by Deft. no. 2 and in the tenanted premises Deft. no. 2 was residing with family members. Plaintiff on 12.12.88 gave notice terminating tenancy asking possession by last day of the month. Plaintiff on 10.3.89 filed suit for possession and asked mesne profits, after termination of tenancy and on expiry of notice period, at market rate of premises at Rs. 50,000.00 p.m. Defts. 4 & 5 filed W/S in March, 90 saying that tenancy had been transferred in the name of Deft. no. 1 and they had no interest. Defts. 1 to 3 did not file W/S until 17.8.90 when their defense was struck out. They appealed to D B. and meanwhile filed W/S so that they could tell D.B. that W/S had been filed. D.B. allowed W/S to be taken on record upon heavy costs. They contended that Amended Rent Act allowing exemption to premises of rent above Rs. 3500.00 was unconstitutional; that Deft. no. 1 alone was not tenant and several associate companies were tenants who were paying less than Rs. 3500.00 rent through Deft. no. 1; that notice was bad as in the premises manifesting processes are done. Before settlement of issues a Director of Deft. no. 1 was examined who stated that Deft. no. 1 alone was tenant, ground floor was being used for residence and upper floor for office. The Court held that there was no manufacturing process and notice terminating tenancy was proper and Deft, no, 1 and 2 alone are tenant and only they were prosecuted by the Dda for misuser. About mesne profits etc. it was held :] (2) Issue NO. 5. This issue is regarding claim of the plaintiffs to damages/manse profits @ Rs. 50,000.00per month w.e.f. 19.1.89. Further the plaintiffs have claimed the amount jointly and severally from the defendants. The tenancy of defendant No. 1 was terminated vide notice Ex. P-l ending with 18.1.89. The plaintiffs have claimed damages/ mesne profits w.e.f. 19.1.89.

    (3) There are two questions involved in the issue. First is the rate at which damages/ mesne profits can be granted or ought to be granted in favor of the plaintiffs. Secondly, whether liability in this connection can be joint and several of defendants 1 to 3. On the first question the plaintiffs have led no evidence although the onus of (he issue is on the plaintiffs. The learned counsel for the plaintiffs has, however, submitted that the court should take judicial notice of the fact of phenomenal rise in rents in Delhi and particularly in posh colonies like Golf Links where the property in suit is located. On this basis the damages/mease profits are claimed at a rate higher than agreed rate of rent. The agreed rate of the premises is Rs. 6.000.00 per month. The plaintiffs have claimed damages/manse profits @ Rs. 50,000.00 per month. Nobody can deny the fact that there has been phenomenal rise in rents in Delhi and particularly in the area where the property in suit is located. However, the claim of the plaintiff is unsubstantiated. The rent of Rs. 6000.00 per month was fixed in the year 1974. In the year 1989, i.e. on termination of the tenancy 15 years had passed. The increase is sought after the termination of the tenancy. Taking a judicial notice of the fact of increase in rents and in order to provide fair compensation to the plaintiffs I consider a sum of Rs. 10,0001- per month to be a fair amount towards damages/mesne profits to be awarded in favor of the plaintiffs. Therefore, the plaintiffs will be entitled to damages/manse profits @ Rs. 10,000.00per month w.e.f. 19th January 1989 till the date of handing over of vacant possession of the premises. Any payment made during the pendency of the suit for this period on account of rent will be liable to be adjusted in this amount, (4) Coming to the second question as to whether all the defendants can be made liable for this payment I am of the view that so far as defendant No. 1 is concerned there can be no dispute about its liability in this behalf. After the termination of tenancy all the defendants who are admittedly in occupation of the premises can be made liable. Admittedly defendants 2 and 3 Along with their family members have been all along residing in the premises during this period and till to day. Defendants 2 and 3 are enjoying the benefits of stay in the premises. In all fairness they should be equally liable for the payment towards damages/mesne profits on account of use and occupation of the premises after termination of the tenancy. Even otherwise defendant No. 1 is a company almost wholly belonging to defendants 2 and 3 and their family members. It is only a corporate veil. The benefits from the company and its premises are totally going to these defendants. Under, the circumstance I hold that for the amount on account of damages/mesne profits as determined by this court all the defendants, i.e. defendants 1 to 3 are jointly and severally liable to the plaintiffs, the issue is disposed of in these terms. The plaintiff will pay court fee on the amount falling due to them under this decree.

    (5) Issue NOS. 6 & 7. Issues No. 6 and 7 are inter connected. The defendants have been using the premises for commercial purposes for which they were also prosecuted by the DDA. The said use is contrary to the terms of the parent lease granted by the Land & Development Officer. If the landlord is saddled with any liability of payment to the Land & Development Officer on account of charges for breaches of the lease committed by the defendants, they are liable to make good the same. The Land and Development Officer has been levying and demanding various charges on account of breaches of the conditions of lease on account of misuse of the premises in suit. In order to keep the property intact it is necessary for landlords plaintiffs to have the breaches regularised and pay the necessary charges. Therefore, the liability for all such lawful charges which are recoverable by the Land & Development Officer has to be borne by the defendants I hold that the defendants are liable to pay the charges as levied by the Land & Develop ment Officer on account of misuse of the premises. A decree is passed in favor of the plaintiffs and against the defendants jointly and severally for payment of the exact amount which is found lawfully payable to the Land & Development Officer on this account. The plaintiffs will be liable to pay, the requisite court fee on the decree for such amount.

    (6) Issue NO. 8. In view of my aforesaid findings I find no hurdle in the way of a decree being passed in favor of the plaintiffs for possession of the property in suit as per plan filed by the plaintiff.

    (7) A.S a result of the above discussion the suit of the plaintiffs is decreed. A decree for possession of the property in suit as per plan is passed in favor of the plaintiff and against defendants 1 to 3. Further a decree is passed in favor of the plaintiffs and against defendants 1 to 3 jointly and severally for damages/ mesne profits @ Rs. 10,000.00 per month w.e.f. 19th January 1989 till handing over of vacant possession of the premises by the defendants to the plaintiffs. This decree will be subject to to the plaintiffs paying the requisite court fee on the amount finally becoming due to the plaintiff on this account. The defendants will however be entitled to adjustment of any amount already paid by them to the plaintiffs for this period. A decree of permanent injunction is also passed in favor of the plaintiffs and against defendants 1 to 3 restraining the defendants from using property No. 5 Golf Links, New Delhi for any purpose other than residential till their handing over vacant possession thereof to the plaintiffs in pursuance of decree for possession.

    (8) Lastly a decree is passed in favor of the plaintiffs and against the defendants for payment by the defendants of all lawful charges payable to (he Land & Development Officer on account of misuse of the premises and for purpose of regularisation of breaches of conditions of lease. The decree will be subject to payment of court fee by the plaintiffs on the amount under the decree. This is without prejudice to the right of the defendants to challenge the demand of the L & D. O., if so, permitted to them in law. The plaintiffs will also be entitled to costs of the suit as per rules.

    Use AI to get other relevant cases.

    Comments

    Bakshi Sachdev (D) v. Concord (I)
    (May 26, 1993)