Anderson Wright and Co. v. Amar Nath Roy, (SC) BS82680
SUPREME COURT OF INDIA

Before:- R.C. Lahoti, CJI and G.P. Mathur, J.

I.A. No. 4 in Civil Appeal No. 2663 of 2004. D/d. 19.4.2005.

Anderson Wright and Co. - Appellant

Versus

Amar Nath Roy and others - Respondents

For the Appellant :- Dr. A.M. Singhvi, Sr. Advocate, Ramesh Singh, A.T. Patra, Nipun Malhotra, Advocates.

For the Respondents :- Mukul Rohtagi, Sr. Advocate, Amal Krishna Saha, Sarad Singhania and Ms. Pratibha Jain, Advocates.

IMPORTANT

Decree of eviction - Tenant to pay mesne profits to landlord if decree is stayed by Appellate Court which will be subject to adjustment on final decision.

A. Civil Procedure Code, Order 20, Rule 12 - Mesne profits - Decree of eviction passed by High Court - Stay granted to tenant by Supreme Court subject to payment of mesne profits @ Rs. 15/- per sq. yard - Landlords to refund, if any amount becomes refundable after decision of appeal by Supreme Court.

[Paras 7 and 5]

B. Civil Procedure Code, Order 20 Rule 12 - Mesne profits - Order of eviction - Order stayed by Appellate Court - Appellate Court can reasonably compensate the decree holder for loss occasioned by delay in execution of the decree by the grant of stay in the event of the appeal being dismissed - From the date of decree of eviction, tenant is liable to pay mesne profits or compensation for use and occupation of the premises at the same rate at which the landlord would have been able to let out the premises on being vacated by the tenant - While determining the quantum of the amount so receivable by the landlord, the landlord is not bound by the contractual rate of rent which was prevalent prior to the date of decree. 2005(1) RCR (Civil) 212 (SC) relied.

[Para 5]

Case Referred :-

Atma Ram Properties (P) Ltd. v. Federal Motors (P) Ltd., 2005(1) RCR (Civil) 212 (SC) : 2005(1) SCC 705.

ORDER

R.C. Lahoti, CJI. - This order disposes of I.A. No. 4 of 2004 filed by the respondents seeking direction to appellants to pay or deposit, month by month, a fixed amount by way of mesne profits, as a condition precedent to the order staying execution of decree for eviction of appellants.

2. The suit property is situated in a prime locality of Kolkata. There are Governor House, High Court, Assembly, G.P.O., Reserve Bank of India, Income-tax office, Writer's building, Telephone Bhawan etc., situated in the same area and some only at a walking distance from the suit property. Admittedly, the respondents are owner-cum-landlords of that part of the property which is held on tenancy by the appellants. The area in possession of the appellants is situated on the third floor and admeasures 6000 sq. ft. according to the respondents but is 5678 sq. ft. according to the appellants. The tenancy was created in the year 1939 at a monthly rent of Rs. 853.87 per month.

3. The respondents initiated proceedings for the eviction of the appellants on the ground of the premises having been sublet or parted with possession by the appellants. The eviction was denied by the trial Court. The appeal preferred by the respondents has been allowed by the High Court and the appellants in favour of four companies, the alleged sub-tenants, who were carrying on business in the suit premises. Out of these four companies, three were still carrying on business while the fourth had stopped business by the time the case came to be decided.

4. On 23.4.2004, leave to appeal was granted by this Court to the appellants and the judgment and decree for eviction passed by the High Court has been directed to remain stayed. I.A. No. 4 of 2004 has been filed by the respondents, seeking direction to the appellants to pay an amount of Rs. 1,80,000/- per month to the respondents during the hearing of the appeal. It is submitted that the suit premises can fetch a rent @ Rs. 30/- per sq. ft. The property tax payable by the respondents to the local authority is Rs. 2,32,000/- per annum, while the appellants are paying a meagre amount of Rs. 837.87 per month to the respondents.

5. As held by this Court in Atma Ram Properties (P) Ltd. v. Federal Motors (P) Ltd., 2005(1) RCR (Civil) 212 (SC) : 2005(1) SCC 705, once a decree for eviction has been passed, in the event of execution of decree for eviction being stayed, the appellants can be put on such reasonable terms, as would in the opinion of the appellate Court reasonably compensate the decree holder for loss occasioned by delay in execution of the decree by the grant of stay in the event of the appeal being dismissed. It has also been held that with effect from the date of decree of eviction, the tenant is liable to pay mesne profits or compensation for use and occupation of the premises at the same rate at which the landlord would have been able to let out the premises on being vacated by the tenant. While determining the quantum of the amount so receivable by the landlord, the landlord is not bound by the contractual rate of rent which was prevalent prior to the date of decree.

6. The learned counsel for the appellants submitted that the appellants cannot be held liable to pay anything more than the standard rent of the premises, in spite of the decree for eviction having been passed as the same is subjudice. This submission needs a summary dismissal in view of the Judgment of this Court in Atma Ram Properties (P) Ltd.'s case (supra). Both the parties have filed affidavit and counter affidavit, placing on record material giving the Court an idea of the rate of rent generally prevalent in the locality where the suit property is situated. Canara Bank on the first floor of this building is paying rent @ Rs. 25/- per sq. ft. other than maintenance and municipal taxes. One Rumpa Ghosh entered as the tenant in the year 2002 is paying rent @ Rs. 32/- per sq. ft. Taking an overall view of the material made available by the parties, we think that the appellants should, from the date of the decree of the eviction, pay mesne profits/compensation for use and occupation @ Rs. 15/- per sq. ft. subject to final determination of the same by a competent forum.

7. The application is disposed of in terms of the following directions :

8. We make it clear that the amount quantified by this Court in this order is only a tentative opinion formed by the Court on the basis of the material made available by the parties and is neither a determination of the actual amount for which the appellants may be held liable for payment to the respondents in duly constituted proceeding for the purpose nor is intended to be a reflection on the merits of the case.

Order accordingly.