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AMICUS AI
Citation Codes
Equivalent Citations
citation codes
Case Number
Disposition
Attorney(S)
Judges
Acts
  • The Rent Act
  • Form 23 of Appendix D of the Code of Civil Procedure
  • Section 5, Subsection 2 of the 1983 Income Tax Act
  • Order 26 Rule 9 of the Code of Civil Procedure
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Disposition
Attorney(S)
Judges
Acts
  • The Rent Act
  • Form 23 of Appendix D of the Code of Civil Procedure
  • Section 5, Subsection 2 of the 1983 Income Tax Act
  • Order 26 Rule 9 of the Code of Civil Procedure
Smart Summary

Factual and Procedural Background

The appellant filed a suit seeking (i) possession of certain premises and (ii) mesne profits or damages. The trial court decreed possession, awarded arrears, and fixed mesne profits at the rent permissible under the Rent Act, holding that the “existing rents” were the proper measure. Dissatisfied, the plaintiff contended that mesne profits should reflect the “present rental value” of the premises, calculated at Rs 60 per 100 sq. ft. The Calcutta High Court, by judgment dated 25 July 1967, affirmed the trial court. The plaintiff obtained a certificate of fitness, resulting in the present Supreme Court appeal.

Legal Issues Presented

  1. Whether mesne profits should be assessed on the basis of “existing rents” permissible under the Rent Act or on the “present rental value” asserted by the plaintiff.
  2. Whether the trial court erred in refusing to dispose of the plaintiff’s application under Order 26 Rule 9 CPC for measurement and inquiry, thereby denying the plaintiff an opportunity to prove higher mesne profits.

Arguments of the Parties

Appellant's Arguments

  • The mesne profits ought to be determined by the current rental value of the premises, quantified at Rs 60 per 100 sq. ft., rather than by statutory rent.
  • The plaintiff had sought a commission under Order 26 Rule 9 CPC to measure the plinth area (alleged to be 40,000 sq. ft.) and to ascertain mesne profits, but the trial court failed to adjudicate that application.
  • Consequently, the plaintiff was prevented from leading evidence necessary to establish the quantum of mesne profits.

Respondent's Arguments

  • The defendant denied the correctness of the plaintiff’s asserted plinth area and refused inspection of the premises.
  • It maintained—consistent with the trial court’s view—that existing statutory rent was a fair measure of mesne profits.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The Supreme Court observed that the plaint expressly claimed mesne profits based on the present rental value. During trial, the plaintiff applied under Order 26 Rule 9 CPC for a local investigation to ascertain both the actual area in the defendant’s occupation and the rental value. Rather than adjudicate that application, the trial court simply allowed it to “stand over” and then disposed of the suit without any inquiry, relying instead on statutory rent.

Referring to Form 23 of Appendix D CPC, the Court noted that a decree for possession can and often should direct an inquiry into mesne profits. By refusing such an inquiry, the trial court deprived the plaintiff of the opportunity to prove its claim. The High Court perpetuated this error by assuming the plaintiff had made no effort to adduce evidence when, in fact, it had been prevented from doing so.

Accordingly, the Supreme Court found both the trial court and the High Court to have acted on a mistaken view of procedure and fairness, necessitating appellate intervention.

Holding and Implications

Appeal Allowed; High Court judgment and decree dated 25 July 1967 set aside.

The matter is remitted to the trial court to hold an inquiry into mesne profits from the date of the suit until delivery of possession, after affording both parties an opportunity to lead evidence. Costs are awarded to the appellant. The decision primarily affects the parties by ensuring a proper factual inquiry and does not purport to establish a new precedent beyond emphasizing procedural fairness in mesne-profit determinations.

    Dalhousie Properties Ltd. v. Surajmull Nagarmull .

    P.N Shinghal, J.— This appeal by certificate is directed against the appellate judgment of the Calcutta High Court dated July 25, 1967 upholding the trial court's view that the “existing rents” would be a “fair measure” of the mesne profits claimed by the appellant.

    2. The suit in question was filed by the appellant for possession of the suit premises and for mesne profits or damages, or an enquiry into mesne profits and damages, and other consequential reliefs. The trial court granted a decree for possession and for arrears, as well as for mesne profits at the rate at which the premises had been let out to the defendant. It took the view that the rent permissible by the Rent Act should determine the mesne profits. The plaintiff felt aggrieved and claimed that he was entitled to mesne profits according to the “present rental value” of the premises which it assessed at Rs 60 per 100 sq. feet. It preferred an appeal and as it has been dismissed by the impugned judgment of a Division Bench of the High Court dated July 25, 1967, it has come up to this Court in appeal by certificate.

    3. It is quite clear from the plaint that the plaintiff specifically claimed, inter alia, that it was entitled to mesne profits and/or damages according to the “present rental value of the premises” i.e at Rs 60 per 100 sq. feet. The plaintiff in fact made an application under Order 26 Rule 9 of the Code of Civil Procedure on June 15, 1959, during the course of the trial, stating that as the defendant had denied the correctness of the claim that the plinth area of the premises was 40,000 sq. feet, and had not stated what the actual and correct measurement was, it addressed a letter to the defendant on February 10, 1959 calling upon it to allow the plaintiff's agent to give inspection and to measure the premises. As that was refused by the defendant's attorney, the plaintiff prayed in its application that an injunction may be issued against the defendant directing it to allow the plaintiff, his servants and agents, to enter upon and measure the premises at the time fixed by the court or, in the alternative, to issue a commission to a person appointed by the court for making a local investigation and reporting the measurement of the area in the defendant's possession and the amount of the mesne profits for the same. Instead of examining that application and disposing it of on the merits, the trial court merely ordered that it would “stand over” till the hearing of the suit. The suit was however decided on April 18, 1962 without disposing of the plaintiff's aforesaid application under Order 26 Rule 9 CPC. It may be that the trial court had in view Form 23 of Appendix D of the Code of Civil Procedure which shows [in para (3)] that a trial court may grant a decree to the effect that an inquiry be made as to the amount of mesne profits from the institution of the suit until delivery of possession to the decree-holder, but, at the time of deciding the plaintiff's claim in the suit, the trial court did not order any such inquiry as it took the view that the rate of interest permissible under the Rent Act should determine the future mesne profits also. It is therefore obvious that the trial court went wrong in denying the plaintiff an opportunity to prove the amount of mesne profits from the date of the institution of the suit until delivery of possession. The High Court did not correct the error while examining the plaintiff's appeal, and laboured under the mistaken impression that the plaintiff did not make any attempt to give evidence on the point during the course of the trial. That was obviously a mistake as the High Court failed to notice that the plaintiff had in fact been prevented from proving its claim for mesne profits at the “present rental value”.

    4. The appeal is therefore allowed, the impugned judgment and decree of the High Court dated July 25, 1967 are set aside and it is directed that the trial court shall make an inquiry as to the amount of mesne profits from the date of the institution of the suit until delivery of possession after giving an opportunity to both the parties to lead their evidence. The appellant will be entitled to its costs from the respondent.

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    Comments

    Dalhousie Properties Ltd. v. Surajmull Nagarmull .
    (Oct 28, 1976)