Posted On by &filed under Delhi High Court, High Court.

Delhi High Court
Tek Chand Narula & Others vs Jammu & Kashmir Bank Ltd. on 15 September, 2000
Author: V Sen
Bench: V Sen


Vikramajit Sen, J.

1. The Plaintiffs have filed the present application under Order XII Rule 6 read with Section 151 of the Code of Civil Procedure 1908 in a suit for ejectment and grant of mesne profits, in respect of property bearing No.1/90, Connaught Circus, New Delhi. In the plaint it has been averred that the tenancy was last extended vide Registered Lease Deed dated 4.4.1996 for an area admeasuring 1745 sq. ft. on the ground floor and about 1626 sq. feet on the mezzanine floor. The rent was thereafter enhanced by 20 per cent with effect from 1.1.1997. The last rent paid, exclusive of other charges was Rs. 3,23,616/-. The tenancy was terminated with effect from the midnight of 31.7.1999 in terms of notice dated 27.5.1999. Clause 6 of the registered Lease Deeds reads as under :

“That all taxes, charges including Property tax, Municipal tax, cesses and Insurance premium on the demised property and other taxes that may be levied on the property by the government and/or any local body or corporation from time to time in respect of the leased premises shall be borne by the Lessors. Provided that in case the House tax on the demised premises as levied at present thereupon be enhanced by any government, legislation, or otherwise, the extent to which the said tax is enhanced shall be paid by the Lessee/bank.

2. It is not averred that the property was previously being assessed in accordance with the Standard Rent provisions of the Delhi Rent Control Act, but with effect from 1.12.1988 the Rateable Value was recalculated on the basis of the rent received. The enhanced property tax for the period 8.12.1988 till 31.3.1999 comes to Rs. 23,45,098/-. Since by a calculation error only Rs. 23,40,479/- had been demanded in the legal notice, the claim has been restricted to this figure. Another notice dated 11.6.98 demanding Rs. 16,41,496/- together with interest at 24% per annum was sent; and this was followed by yet another notice of 27.5.1999 demanding Rs. 23,40,479/- plus interest at the rate of 24 per cent per annum from the Defendant. This notice has been replied to by the Defendant in terms of its letter dated 8.6.1999. The Plaintiffs have claimed damages at the rate of Rs. 200/- per sq. ft. per month.

3. In its Written Statement the Defendant has highlighted the fact that the Plaintiff had earlier filed a suit in February, 1992 also for possession and mesne profits which was dismissed under Order IX Rule 8 of the C.P.C. In this suit no claim for enhancement of tax had been made and, therefore, estoppel barred a claim on this account. Section 67 of the N.D.M.C. Act has also been pressed in opposition to this claim. The Defendant has further interpreted Clause 6 of the Lease Deed dated 4.4.1996 in a manner that the enhanced tax would be to the Plaintiff’s account. Paragraphs 1 to 4 of the Plaint pertaining to the ownership of the property have been denied. It is the Defendant Bank’s case that after the filing of S.No. 216/1992 an amicable settlement had been arrived at, which was expressed in the terms of the Lease Deed dated 4.4.1996. The fresh term was for nine years with effect from 1.1.1996 with a renewal thereof at the sole option of the Defendant, for a further period of two years. The notice dated 27.5.1999 is predicated to be invalid and illegal and no breach of the terms of the Lease Deed are stated to have taken place. In respect of Clause 6 it ise further averred that Property Tax at the then prevailing rates were paid by the Lessor and only in case of a change in the rate of Tax, and not the fixation or revision of the Retable Value, the enhancement would be payable by the Defendant. Since there was no change/enhancement in the rate of House Tax by any Legislation, the Defendants are not liable to pay the alleged proportionate share of the escalation/enhancement in House Tax. He has further submitted that the Plaintiffs cannot demand any payment of House Tax prior to 1st January, 1996 and that the claim for the period 1988 89 is time barred and also barred as it had not been claimed in the previously instituted Suit No. 219/1992 which was dismissed on 21.4.1997. Thereafter, liability to pay Rs. 23,40,479/- or Rs. 33,01,922/- has been denied. It is alleged that a part of this claim in any case is barred by time. It is further pleaded that the demand of the Plain- tiff of damages at the rate of Rs.200 per Sq. ft. is without any basis and the rents in the locality have gone down after 1.1.1996. The Defendant wants to continue in the premises as this Branch is functioning here for about two decades. It is denied that the Defendant is liable to pay damages and for use and occupation of the suit premises at the rate of Rs. 6,74,200/- per month. It is denied that the Lease Deed dated 1.2.1982 can be looked into. It is denied that the suit has been properly valued.

4. It is on the basis of these pleadings that the Plaintiff has submitted in the application that a decree should be passed forthwith on the following reliefs:

   "1. Pass a decree of ejectment/possession directing the defendant    to hand over the vacant and peaceful possession of the suit    property i.e. an area admeasuring about 1745 sq.ft. on the ground    floor and about 1626 Sq.ft. on the Mezzanine floor of the said    property No. 1/90, Connaught Circus, New Delhi, which is more    appropriately shown in red colour in the site plan annexed to the    plaint, to the plaintiffs; 

   2. Pass a decree in favour of the plaintiffs and as against the    defendants for the recovery of arrears of house tax charges    already paid by the plaintiffs to the concerned authorities, for    the period 8.12.1988 till 31.3.1999, in respect of the suit    property and payable by the defendant to the plaintiff, amounting    to a total sum of Rs. 33,01,922.00 (Rs. Thirty three lakhs one    thousand nine hundred twenty two only) comprising of a principal    sum of Rs. 23,40,479/- (Rupees Twenty three lakhs forty one    thousand four hundred seventy nine only) and interest amounting    to Rs. 9,61,443.00 @ 24% per annum, upto the filing of the suit; 

   3. to award pendente lite and future interest @ 24% per annum on    the above said amount as is the usual custom of the trade till    the payment or realisation of the amount; 

   4. pass a decree of mandatory injunction thereby directing the    defendants, their administrators, successors, assigns, agents,    etc. to either deposit its share of the future proportionate    house tax in respect of the suit property directly to the authorities concerned or to pay the same to the plaintiffs, as envisaged in clause 6 of the lease deed dated 4.4.1996, executed    between the parties and binding on them until the defendant    illegally retains the suit property; 

   5. Proportionate cost of the suit be also awarded in favour of    the plaintiff and as against the defendants; and

   6. Any other and further relief/order or direction which this    Hon'ble Court may deem fit and proper in the circumstances of the    case be also granted in favour of the plaintiffs and as against    the defendant. 

   Significantly, the prayer for mesne profits, although originally    prayed for in the plaint, has not been claimed. It was open to    the Plaintiff to claim only a partial decree, if that was alone    sustainable in the context of the alleged admissions, but since    costs of the suit, albeit 'proportionate' have been asked for,    this claim appears to have been abandoned.    

5.  For a decree of ejectment to be passed the Plaintiff must succeed in proving that the relationship of landlord and tenant is undisputed, and that the lease has come to an end. This could be either by efflux of time or by a legal determination of the tenure of the Lease. Although, in the present case, pleadings questioning the title of the Plaintiffs can be found in the Written Statement, a challenge on this ground is not available. In Jahuri Sah and others Vs. Dwarika Prasad Jhunjhunwala and others, , the Apex Court observed as follows:     

   "Instead, what is stated in both these written statements is that    the defendants have no knowledge of the allegations made in Para.    1 of the plaint. Bearing in mind that O.VIII, R.5, C.P.C. provides that every allegation of fact in the plaint, if not denied    specifically or by necessary implication or stated to be not    admitted in the pleading of the Defendant shall be taken to be    admitted, to say that a defendant has no knowledge of a fact    pleaded by the plaintiff is not tantamount to a denial of the    existence of that fact not even an implied denial."  

6.  In Tej Bhan Madan Vs. II Additional District Judge and others, , the Apex Court observed as follows:     

   "There can be a denial of the title of his landlord without the    tenant renouncing his character as such where, for instance, he    sets up a plea of Justertii. The stance of the appellant against    the third respondent's title was not on the ground of any infirmity or defect in the flow of title from Gopinath, but on the    ground that the latter's vendor Mainavati herself had no title.    The derivative title of the third respondent is not denied on any    ground other than the one that the vendor, Gopinath  to whom    appellant had attorney  had himself no title, the implication of    which is that if appellant could not have denied Gopinath's title    by virtue of the inhibitions of the attornment, he could not    question third respondent's title either. Appellant did himself    no service by this stand."  

7.  In Anar Devi Vs. Nathu Ram,  it has been observed as follows:     

   "Doctrine of tenant's estoppel" which governs the relationship of    landlord and tenant is founded on a contract of tenancy entered    into by them. This doctrine finds statutory recognition in Section 116 of the Indian Evidence Act, 1872. In a suit for eviction    by landlord, the tenant is estopped from questioning the title of    the landlord because of Section 116. That section applies and    estops even a person already in possession as tenant under one    landlord from denying the title of his subsequent landlord when    once he acknowledges him as his landlord by attornment or conduct. Therefore, a tenant of immovable property under landlord    who becomes a tenant under another landlord by accepting him to    be the owner who had derived title from the former landlord,    cannot be permitted to deny the latter's title, even when he is    sought to be evicted by the latter on a permitted ground."   

8. As regards the next plea of the Applicant, that is, the determination of the Lease, it needs to be recalled that the parties have entered into a registered Lease Deed dated 4.4.1996. It states that the tenure is “for a period of nine years w.e.f. 1.1.1996 renewable at the sole option of the Bank for a further period of two years on the same terms and conditions.” In the normal course the tenancy would therefore continue upto 31.12.2005 or, after renewal till 31.12.2007. The Lease has thus not come to an end by efflux of time. Accordingly, ejectment can be prayed for only if a notice of termination had been served on the Defendant in accordance with the provisions of the Transfer of Property Act. A clear and unequivocal case must be made by the landlord in all such cases, as it would not be equitable to eject a tenant before the expiry of the contracted tenure of the Lease. The tenant has most often expended large sums of money on the demised premises, expecting to continue for the period of the Lease. While the receipt of the notice is not denied, learned counsel for the Defendant has vehemently argued that it is illegal and cannot terminate the term fixed by it. A perusal of the said letter dated 27.5.1999 discloses that a demand for the sum of Rs. 23,40,479/- (Rupees Twenty three lakhs forty thousand four hundred seventy nine only) together with interest thereon at the rate of 24 per cent per annum towards the Defendant’s share of property tax had been made. This claim was founded on Clause 6 of the Lease Deed which has already been reproduced above. It was further notified that if this demand was not met, the tenancy would stand terminated on the midnight of 31.7.1999. The Defendant Bank replied to this notice in which it was stated inter alia, as follows:

“The rent of the premises was fixed @ Rs. 3883392/ per annum w.e.f. 1/1/1997 and your client was thus given a 693% increase in the rent of the premises. By execution of a fresh Lease deed your client thus surrendered all previous claims against the bank except payment of rent as per lease deed. Your client cannot therefore prefer any claim against the Bank in respect of the House tax. It is also clear that the increase in the House tax has been caused because of revised assessment of the value of the property by the NDMC New Delhi on the basis of annual actual rent and as such the enhancement so made in the House tax does not fall within the scope of the obligation undertaken by the bank as per clause 6 contained in the aforesaid lease deed dated 4th April, 1996. It may also be stated that NDMC Act, 1994 envisages a detailed scheme for the increase and payment of House/property tax. The said Act provides that the Property tax shall be primarily leviable upon the Lessor if the land building is let or on the superior Lessor if the land or building is sublet or upon the person in whom the right to let the property vests if the land or building is unlet. The said Act also provides that the person upon whom the said tax is leviable that person shall be entitled to receive from his tenant the difference between the amount of Property tax levied upon him and the amount which will be leviable upon him if the said tax was calculated on the amount of rent payable to him. Since the enhancement in Property tax has been made upon the annual actual rent which the bank is paying to your clients, the Bank is not responsible to pay the enhanced property tax to your clients. It may also be stated that any clause contrary to the scheme of the said act is void and unenforceable. It may be stated further that the Bank has performed and is performing all the obligations under the said Lease deed dated 04/01/96 and as such no question of determining the Lease does arise. More so it may be stated that your client has no right to determine or terminate the said lease.”

9. This stand has also been adopted and reiterated in the Written Statement. In these circumstances I am unable to appreciate how the provisions of Order XII Rule 6 can be pressed into operation by the Plaintiff. A tenant may in a given case deny the receipt of the notice of termination but if it is evident to the Court from any evidence aliunde that the notice was actually served upon the tenant, it would be expected of the Court to proceed under Order XII Rule 6. Likewise, the tenant may perfunctorily state that the notice was illegal, inter alia, because it did not terminate the tenancy coterminous with the end of the tenancy month. If the Court finds to the contrary it would be justified in proceeding under this provision. However, in the event that the tenant raises a ground for assailing the validity and legality of a notice of termination, which ground requires careful attention and extensive arguments to substantiate the rival contentions, I am in no doubt that that Order XII Rule 6 would have no application. Even if the Plaintiff’s contention is that no evidence need be led in view of the issues that have arisen, in order to expedite the disposal of the case he may state that he does not wish to lead any evidence. If the Court is also of the view that evidence is not required, the Court may expedite the disposal of the case by fixing an early date for the Defendant’s evidence if the latter insists on exercising this right. In 1995 the rent was Rs.7,16,208/-; which stood increased to Rs.33,37,968/- in the next year and to Rs. 38,83,392/- thereafter. I cannot read Clause 6 as admitting of only one interpretation, i.e. that all increases in taxes, even those consequent upon the Annual Value being upwardly revised because of the astronomical increase in rent. The defense is not moonshine, and one which calls for careful consideration. There can be no admission, in these circumstances. Even in these circumstances Order XII Rule 6, which deals with the passing of a decree on the basis of admissions made, would not apply.

10. A plethora of precedents were relied upon by learned counsel for the Plaintiff. A copy of an unreported judgment of the Hon’ble Supreme Court delivered on 8.8.2000 in the case of Uttam Singh Dugal & Co. Ltd. Vs. Union Bank of India and Ors. was handed over. The Court had taken note of the objects and reasons set out while amending the rule to the effect that it enabled the party to obtain a speedy judgment at least to the extent of the relief to which according to the admission of the Defendant, the Plaintiff is entitled. The Apex Court observed as follows:

“As to the object of the Order XII Rule 6, we need not say any- thing more than what the legislature itself has said when the said provision came to be amended. In the objects and reasons set out while amending the said rule, it is stated that “where a claim is admitted, the court has jurisdiction to enter a judgment for the plaintiff and to pass a decree on admitted claim. The object of the Rule is to enable the party to obtain a speedy judgment at least to the extent of the relief to which according to the admission of the defendant, the plaintiff is entitled.” We should not unduly narrow down the meaning of this Rule as the object is to enable a party to obtain speedy judgment. Where other party has made a plain admission entitling the former to succeed, it should apply and also wherever there is a clear admission of facts in the face of which, it is impossible for the party making such admission to succeed.

The next contention canvassed is that the resolutions or minutes of meeting of the Board of Directors, resolution passed thereon and the letter sending the said resolution to the respondent bank cannot amount to a pleading or come within the scope of the Rule as such statements are not made in the course of the pleadings or otherwise. When a statement is made to a party and such statement is brought before the Court showing admission of liability by an application filed under Order XII Rule 6 and the other side has sufficient opportunity to explain the said admission and if such explanation is not accepted by the court, we do not think the trial court is helpless in refusing to pass a decree. We have adverted to the basis of the claim and the manner in which the trial court has dealt with the same. When the trial Judge states that the statement made in the proceedings of the Board of Directors meeting and the letter sent as well as the pleadings when read together, leads to unambiguous and clear admission with only the extent to which the admission is made is in dispute. And the court had a duty to decide the same and grant a decree. We think this approach is unexceptionable.

Before the trial judge, there was no pleading much less an explanation as to the circumstances in which the said admission was made, so as to take it out of the category of admissions which created a liability. On the other hand, what is stated in the course of the pleadings, in answer to the application filed under Order XII Rule 6 CPC, the stand is clearly to the contrary. Statements had been made in the course of the Minutes of the Board of Directors held on 30th May, 1990 to which we have already adverted to in detail. In the pleadings raised before the Court, there is a clear statement made by the respondent as to the undisputed part of the claim made by them. In regard to this aspect of communicating the resolution dated 30th May, 1990 in the letter dated 4th June, 1990 what is stated in the affidavit in opposition in application under Order XII Rule 6 CPC is save, what are matters on record and save what would appear from the letter dated 30th May, 1990 all allegations to the contrary are disputed and denied. This averment would clearly mean that the petitioner does not deny a word of what was recorded therein and what is denied is the allegation to the contrary. The denial is evasive and the learned judge is perfectly justified in holding that there is an unequivocal admission of the contents of the documents and what is denied is extent of the admission but the increase in the liability is admitted.”

11. The ratio infact supports the stand that, in the facts and circumstances of the present case, the application is wholly misconceived since a substantial defense has been raised by the Defendant Bank.

12. This is also the view of the Division Bench of this Court in Surjit Sachdev Vs. Kazakhstan Investment Services Pvt. Ltd. & Ors. . The following passages will illustrate that the facts were wholly different.

“17. The question now is that whether there is any admission or not so as to entitle the plaintiff to have a decree for possession. The factors which deserve to be taken into consideration in order to enable the Court to pass a decree in plaintiff’s favour as regards possession in such like suit, are: (a) existence of relationship of lessor and lessee or entry in possession of the suit property by defendant as a tenant; and (b) determination of such relation in any of the contingency, as envisaged in Section 111 of the Transfer of Property Act. One of the modes stated therein is by efflux of time limited by the lease. Only on unequivocal admission of the above two factors will entitle the plaintiff to a decree on admission. Admission need not be made expressly in the pleadings. Even on constructive admissions Court can proceed to pass a decree in plaintiff’s favour.”

“28. Lease in this case having come to an end even on the defendants’ plea on 14.1.1996. The defendants having no right, the plaintiff definitely is entitled to a decree for possession since no issue can be said to be arising for determination in so far as claim for possession is concerned. On this score alone the plaintiff would be entitled to a decree on the admission contained in the written statement.”

13. In Vikas Theatres and Exhibitors Vs. Punjab & Sind Bank, , the Court held that since the Defendant had pleaded that the Lease would expire in February 1997, a decree on this admission should be passed. This decision has no application to the facts of the case in hand. Similarly, on the facts of the case it was held that no triable issues had arisen in K. Kishore & Construction (HUF) Vs. Allahabad Bank, , and hence the application under Order XIV Rule 6 was allowed.

The decision in M/s. S.L. Associates Pvt. Ltd. Vs. Karnataka Handloom Development, cited by Learned Counsel for the Plaintiff, in fact overrules the argument put forwarded by Learned Counsel for the Plaintiff. It was held that in view of the admissions given by the Defendant of having come into possession of the premises on the strength of a particular document, and in view of the terms of the said document, the Plaintiff was entitled to get a decree for eviction. There was no controversy surrounding any of the terms of the said Deed, as exists in the present case. It is, therefore, essential for the Court to undertake a scrutiny of the terms of the Deed and only if there is no dispute, or two disparate interpretation to any of its Clauses is not possible, should the application be entertained. Again, in Abdul Hamid & Others Vs. Charanjit Lal Mehra, , on a consideration of the relevant terms of the Lease Deed, the Court was able to arrive at an unequivocal conclusion that a decree of possession should be passed. In Atma Ram Properties Pvt. Ltd. Vs. Air India, , the Court proceeded under Order XIV, Rule 6 and granted a decree of possession interalia because the document on which the right to renewal was claimed, was not a registered one and, therefore, the right of renewal itself was without any basis. The fact that the Defendant had not sent any reply to the legal notice received by them, convinced the Court that the notice was not invalid on any grounds including under any of the provisions of the Transfer of property Act, 1882. The Court came to the conclusion that the plea of right of renewal had been put forward only to protract the proceedings. In the present case none of these conclusions can be arrived at. The reliance on Shikhar chand Vs. Bari Bai, is also misplaced as would be evident from the following paragraph:

“In Sheojee Bhai Vs. Shvamacharan, Civil Revn. No. 385 of 1962 D/- 26.10.1962 (Madh Pra) Bhargava, J. directed the trial Court to pass a suitable decree for eviction of the defendant from the suit premises on the basis of the case as set up by the defendant. In that case tenancy was created by a registered leasedeed commencing from 22.5.1950 and its duration was 10 years. After the expiry of the lease by efflux of time on 22.5.1960 the landlord brought a suit for eviction against the defendants tenants as they had failed to vacate the accommodation in spite of the notice. The defendant No.1 pleaded in his written statement that the lease was not determined as it was extended for 2 years, after the expiry of the period originally fixed by a verbal agreement. The trial Court framed an issue covering the question of extension of lease for two years. Subsequently the defendant No.1 made an application alleging that there was a compromise between the parties according to which the lease of the suit premises was to continue for a further period of two years commencing from 20.5.1960. The plaintiff denied the said compromise and alleged that it was put forward only to prolong the case with a mala fide intent. However, while the suit was still being tried the period of two years expired on 23.5.1962. The plaintiff then made an application without prejudice to his pleadings that he was entitled to a decree for possession under Order 12 Rule 6 of the Code of Civil Procedure. This application was opposed and was rejected by the lower Court. The order was, however, set aside in revision and the lower Court was directed to pass a decree for eviction. We agree with the view taken by this Court in that case. The position in this case both in regard to facts as well as law is very much similar. Here the defendant has taken a defense that under a compromise the term of the lease was extended by 10 years and this terms has expired. It was, therefore, open to the Court to base a judgment against the defendant on the basis of his own admissions because it is clear from the case as set up by him that he was not entitled to continue in possession, in any case, after the expiry of the fresh term of 10 years.”

14. The case was argued at considerable length and a large portion of the time available to the Court has been exhausted. The application is untenable. The Plaintiff has already received a very substantial increase in rent and ought to have anticipated and have been prepared for the increase in the property taxes. The Plaintiff may be justified in attempting for the early conclusion of the case but when serious controversy and opposition has been raised in respect of the present application, he ought to have had the perspicacity and sagacity not to press it with the obstinacy which he demonstrated. As was submitted on the last date of hearing, the Plaintiff has already received possession of the premises from the Defendant. There is no averment in the Written Statement which could be construed as an admission and which would mandate the passing of a decree forthwith.

15. Accordingly, the application is dismissed with costs of Rs. 5,000/- to be deposited by the Plaintiff with the Registrar of this Court within four weeks, by Demand Draft payable to the Prime Minister’s National Relief Fund.

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