This now only leaves me to decide that in the facts of the present case what would be the date from which interim compensation ought to have been awarded by the Appellate Authority. As mentioned earlier, section 106 of the Transfer of Property Act, 1882 clearly stipulates that in the absence of a contract or local law or usage to the contrary, the lease of immovable property for agricultural or manufacturing purposes shall be deemed to be a lease from year to year terminable on the part of the lessor or the lessee by six months' notice. A lease of immovable property for any other purpose shall be terminable on the part of either the lessor or the lessee by 15 days' notice. In the facts of the present case, it is the case of the Plaintiff that an open plot of land was leased to the Defendant which was not leased out for any agricultural or manufacturing purposes. This being the case, at least prima facie, the possession and occupation of the suit premises by the Defendant would be unlawful on the expiry of 15 days from the date of the termination notice (viz. 9th January, 2012). In other words, the possession and occupation of the Defendant would be wrongful from 25th January, 2012. This being the case, I am of the view that the compensation that ought to have been fixed by the Appellate Authority of Rs.1,50,000/- per month, should have been from 1st February, 2012 till the disposal of the Appeal.
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
B. P. COLABAWALLA, J.
Mr. Mujibur Rehman Haji Israr Alam Siddiqui Vs. M/s. K. T. Kubal and Co.
Writ Petition No.80 of 2017
14th July, 2017.
Citation: 2018(2) ALL MR 267,2017(6) BOM.CR.382
JUDGMENT :- Rule. Respondent waives service. Rule made returnable forthwith and heard finally.
2. This Writ Petition has been filed under Article 227 of the Constitution of India challenging the order dated 22nd September, 2016 passed by the Appellate Bench of the Small Causes Court, Mumbai below Exh.7. Exh.7 was a Stay Application filed by the Respondent herein in Appeal No.303 of 2016 which challenged the judgment and decree dated 3rd May, 2016 passed in T.E. Suit No.114/142 of 2012. By this decree, the Respondent herein was evicted from the premises being an open space of land admeasuring 4000 sq.ft. situated in the compound of a building popularly known as Mujibur Rehman Brothers Building, R.S. Nimkar Marg, Faras Road, Mumbai 400 008 (hereinafter referred to as the "suit premises").
3. Few facts that need to be noted for disposal of this Writ Petition are that the Petitioner herein (Plaintiff in the Trial Court) filed a Suit for eviction of the Respondent (Defendant before the Trial Court) being T.E. Suit No.114/142 of 2012 on the grounds more particularly mentioned in the plaint. This Suit was filed under the provisions of the Presidency Small Causes Courts Act, 1881 as the suit premises was an open plot of land and the Defendant did not get protection under the provisions of the Maharashtra Rent Control Act, 1999. In view of this, the tenancy of the Defendant was terminated by the Plaintiff vide its letter dated 9th January 2012. It is after the expiry period of the termination notice that the Plaintiff filed the aforesaid suit.
4. This Suit was contested by the Defendant by filing its written statement. Thereafter, issues were framed by the Trial Court and on the basis of these issues, the parties led their respective evidence. The Trial Court, thereafter, after hearing the parties, by it judgment and order dated 3rd May 2016 decreed the suit and ordered eviction of the Defendant. The Trial Court further also ordered an inquiry into mesne profits under the provisions of Order XX Rule 12 of the CPC.
5. Being aggrieved by this judgment and order of the Trial Court, the Defendant preferred an Appeal before the Appellate Bench of the Small Causes Court, Mumbai viz. PSCC Appeal No.303 of 2016.
6. I must mention here that as there was some bonafide error in the judgment and decree dated 3rd May, 2016 regarding the description of the suit property, the Plaintiff moved the Trial Court for modification / clarification of the said judgment and decree. The Trial Court by its order dated 1st July, 2016 accordingly corrected / modified the description of the suit property as mentioned in its earlier judgment and decree of 3rd May, 2016.
7. Be that as it may, alongwith the Appeal filed by the Defendant challenging the decree dated 3rd May 2016, the Defendant also preferred a Stay Application (Exh.7) seeking a stay of the execution of the decree. The order impugned in this Writ Petition (dated 22nd September, 2016) has been passed in this Stay Application (Exh.7). By the impugned order, the execution of the decree against the Defendant was stayed subject to the Defendant depositing compensation at the rate of Rs.1,50,000/- per month from May 2016 to September 2016 within a period of three months from the date of the order. Further monthly compensation at the same rate was also to be deposited on or before the 10th day of each month, pending the hearing and final disposal of the Appeal. Over and above this, the Defendant was also directed to deposit arrears of rent which the Petitioner herein was allowed to withdraw.
8. In this factual backdrop, Mr Godbole, learned counsel appearing on behalf of the Petitioner, challenged the impugned order mainly on two grounds. The first ground on which the impugned order was challenged was the quantum of compensation fixed by the Appellate Authority. According to Mr Godbole, the Appellate Authority had accepted the valuation reports filed by the Plaintiff and rejected the valuation report that was relied upon by the Defendant. According to Mr Godbole, the valuation reports relied upon by the Plaintiff clearly showed that fair market compensation for the suit premises would be in the range of Rs.1,68,000/- per month to Rs.2,00,000/- per month. This being the case, there was absolutely no reason for the Appellate Authority to fix compensation at the rate of Rs.1,50,000/- per month as was done by the impugned order, was the submission. Mr Godbole submitted that this is more so in the facts of the present case, because the valuation report relied upon by the Defendant was rejected by the Appellate Authority.
9. The second contention raised by Mr Godbole was that in any event, the interim compensation ought to have been fixed not from the date of the decree (May 2016) but from the date of the expiration of the termination notice. He submitted that in the facts of the present case, it was a clear finding of the Trial Court that the Defendant was in wrongful occupation of the suit premises on the expiry period of the termination notice. This finding of the Trial Court, according to Mr Godbole, was also in consonance with the provisions of section 106 read with section 111(h) of the Transfer of Property Act, 1882. Considering that the Defendant did not get protection under the provisions of the Maharashtra Rent Control Act, 1999, the Defendant was in wrongful occupation from the expiry period of the termination notice and not from the date of the decree as would be the case when a tenant (who was protected under the provisions of the Maharashtra Rent Control Act, 1999) is sought to be evicted. In support of this proposition, Mr Godbole relied upon a decision of the Supreme Court in the case of Atma Ram Properties (P) Ltd. v/s Federal Motors (P) Ltd., reported in (2005) 1 SCC 705. For all the aforesaid reasons, Mr Godbole submitted that the impugned order clearly suffers from perversity and/or an error apparent on the face of the record requiring my interference under Article 227 of the Constitution of India.
10. On the other hand, Mr Karande, learned counsel appearing on behalf of the Defendant, submitted that there was absolutely no infirmity in the impugned order requiring interference in my limited jurisdiction under Article 227 of the Constitution of India. As far as the quantum fixed by the Appellate Authority is concerned, Mr Karande submitted that the Appellate Authority had correctly considered the valuation report submitted by the Plaintiff and thereafter fixed the compensation at the rate of Rs.1,50,000/- per month. He submitted that when it comes to fixing interim compensation under Order 41 Rule 5 of the CPC, certain amount of guess work has to be undertaken by the Appellate Authority. In the facts of the present case, the Appellate Authority, in its discretion, thought it fit to fix the interim compensation at Rs.1,50,000/- per month and it certainly cannot be said that the exercise of this discretion suffers from perversity and/or an error apparent on the face of the record requiring my interference under Article 227 of the Constitution of India.
11. On the second contention raised by Mr Godbole, viz. the date from which compensation ought to have been fixed, Mr Karande submitted that the Appellate Authority has stayed the execution of the decree on the condition that the Defendant deposit interim compensation of Rs.1,50,000/- per month from the date of the decree till the disposal of the Appeal. He submitted that the power exercised by the Appellate Authority under Order 41 Rule 5 of the CPC is completely distinct and separate from the power exercised by the Trial Court under Order 20 Rule 12 when it makes an inquiry into mesne profits. In the facts of the present case, Mr Karande submitted that an inquiry as contemplated under Order 20 Rule 12 has not yet been completed and therefore, there was nothing wrong in the impugned order under which interim compensation was ordered to be deposited from the date of the decree till the disposal of the Appeal. For all the aforesaid reasons, Mr Karande submitted that there was no merit in the Writ Petition and the same ought to be dismissed.
12. I have heard the learned counsel for the parties at length and perused the papers and proceedings in the Writ Petition. I have also given my careful consideration to the impugned order. On the issue of quantum of compensation fixed (viz. Rs.1,50,000/- p.m.), I find considerable force in the arguments canvassed by Mr Karande. In the impugned order, the Appellate Authority has correctly analyzed the two reports filed by Kishore Karamsey. These reports were relied upon by the Plaintiff. In the first report, Kishore Karamsey came to the conclusion that assessment of fair market rent of open land is Rs.1,68,000/- per month. In the second report, the same Valuer assessed the fair market rent of the land as if it was used for an industrial purpose and thereafter came to the conclusion that the fair market rent would be Rs.2,00,000/- per month. Looking to the figure that has been mentioned by the Valuer for fixing compensation, I do not think that the discretion exercised by the Appellate Authority by fixing a figure of Rs.1,50,000/- can be said to be so perverse or suffering from any error of law apparent on the face of the record requiring my interference under Article 227 of the Constitution of India. I therefore find that at least on this issue, the order of the Appellate Authority does not suffer from any infirmity in fixing interim compensation at the rate of Rs.1,50,000/- per month. Mr Karande is correct when he submits that whilst passing an order of interim compensation under Order 41 Rule 5 of the CPC, the Appeal Court has to engage in a little bit of guess work and unless it is shown that the discretion exercised by Appeal Court is perverse, the Writ Court should loathe to interfere in the exercise of such discretion.
13. This now leaves me to deal with the second contention raised by Mr Godbole, namely, from what date this interim compensation ought to have been fixed by the Appellate Authority. In this regard, I find considerable force in the arguments canvassed by Mr Godbole. Admittedly, in the present case, as per the finding of the Trial Court, the Defendant is not a tenant who gets protection under the provisions of the Maharashtra Rent Control Act, 1999. He would therefore be a contractual tenant. Contractual tenancies not protected by the Maharashtra Rent Control Act, 1999 are governed by the provisions of the Transfer of Property Act, 1882. For our purposes, sections 106 and 111 are relevant and read thus :-
106. Duration of certain leases in absence of written contract or local usage.-(1) In the absence of a contract or local law or usage to the contrary, a lease of immovable property for agricultural or manufacturing purposes shall be deemed to be a lease from year to year, terminable, on the part of either lessor or lessee, by six months' notice; and a lease of immovable property for any other purpose shall be deemed to be a lease from month to month, terminable, on the part of either lessor or lessee by fifteen days' notice.
(2) Notwithstanding anything contained in any other law for the time being in force, the period mentioned in sub-section (1) shall commence from the date of receipt of notice.
(3) A notice under sub-section (1) shall not be deemed to be invalid merely because the period mentioned therein falls short of the period specified under that sub-section, where a suit or proceeding is filed after the expiry of the period mentioned in that sub-section.
(4) Every notice under sub-section (1) must be in writing, signed by or on behalf of the person giving it, and either be sent by post to the party who is intended to be bound by it or be tendered or delivered personally to such party, or to one of his family or servants at his residence, or (if such tender or delivery is not practicable) affixed to a conspicuous part of the property.
111. Determination of lease.- A lease of immovable property, determines-
(a) by efflux of the time limited thereby;
(b) where such time is limited conditionally on the happening of some event by the happening of such event;
(c) where the interest of the lessor in the property terminates on, or his power to dispose of the same extends only to, the happening of any event by the happening of such event;
(d) in case the interests of the lessee and the lessor in the whole of the property become vested at the same time in one person in the same right;
(e) by express surrender; that is to say, in case the lessee yields up his interest under the lease to the lessor, by mutual agreement between them;
(f) by implied surrender;
(g) by forfeiture, that is to say, (1) in case the lessee breaks an express condition which provides that on breach thereof the lessor may re-enter; or (2) in case the lessee renounces his character as such by setting up a title in a third person or by claiming title in himself; or (3) the lessee is adjudicated an insolvent and the lease provides that the lessor may re-enter on the happening of such event; and in any of these cases the lessor or his transferee gives notice in writing to the lessee of his intention to determine the lease;
(h) on the expiration of a notice to determine the lease, or to quit, or of intention to quit, the property leased, duly given by one party to the other.
14. Section 106(1) of the Transfer of Property Act, 1882 inter alia stipulates that in the absence of a contract or local law or usage to the contrary, a lease for immovable property for agricultural or manufacturing purposes shall be deemed to be a lease from year to year terminable on the part of either the lessee or the lessor by six months' notice. A lease of immovable property for any other purpose shall be deemed to be a lease from month to month terminable on the part of either the lessor or the lessee by 15 days' notice. Section 106(4) stipulates that every notice under subsection (1) must be in writing, signed by or on behalf of the person giving it, and either be sent by post to the party who is intended to be bound by it or be tendered or delivered personally to such party, or to one of his family or servants, at his residence, or if such tender or delivery is not practicable, affix it to a conspicuous part of the property.
15. Section 111 deals with determination of a lease and clause (h) thereof stipulates that a lease of immovable property determines on the expiration of a notice to determine the lease, or to quit or of intention to quit the property leased, duly given by one party to the other. Reading section 106 with section 111(h) of the Transfer of Property Act, 1882, what is abundantly clear is that once the lesseee gives a notice to determine the lease, on the expiration of the period mentioned in the notice, the lessee no longer has any authority to continue in possession of the leased premises. His occupation and possession of the premises would clearly be wrongful. This being the case, I find considerable force in the argument of Mr Godbole that the interim compensation fixed by the Appellate Authority ought to have been from the date of the expiration of the period of the termination notice and not from the date of the decree. In this regard, I find the reliance placed by Mr Godbole on the decision of the Supreme Court in the case of Atma Ram Properties (P) Ltd. (supra) is well founded. Paragraph 11 of this decision reads thus :-
"11. Under the general law, and in cases where the tenancy is governed only by the provisions of the Transfer of Property Act, 1882, once the tenancy comes to an end by determination of lease under Section 111 of the Transfer of Property Act, the right of the tenant to continue in possession of the premises comes to an end and for any period thereafter, for which he continues to occupy the premises, he becomes liable to pay damages for use and occupation at the rate at which the landlord could have let out the premises on being vacated by the tenant. In the case of Chander Kali Bai[(1977) 4 SCC 402] the tenancy premises were situated in the State of Madhya Pradesh and the provisions of the M.P. Accommodation Control Act, 1961 applied. The suit for eviction was filed on 8-3-1973 after serving a notice on the tenant terminating the contractual tenancy w.e.f. 31-12-1972. The suit came to be dismissed by the trial court but decreed in first appeal decided on 11-8-1975. One of the submissions made in this Court on behalf of the appellant tenant was that no damages from the date of termination of the contractual tenancy could be awarded; the damages could be awarded only from the date when an eviction decree was passed. This Court took into consideration the definition of tenant as contained in Section 2(i) of the M.P. Act which included "any person continuing in possession after the termination of his tenancy" but did not include "any person against whom any order or decree for eviction has been made". The Court, persuaded by the said definition, held that a person continuing in possession of the accommodation even after the termination of his contractual tenancy is a tenant within the meaning of the M.P. Act and on such termination his possession does not become wrongful until and unless a decree for eviction is passed. However, the Court specifically ruled that the tenant continuing in possession even after the passing of the decree became a wrongful occupant of the accommodation. In conclusion the Court held that the tenant was not liable to pay any damages or mesne profits for the period commencing from 1-1-1973 and ending on 10-8-1975 but he remained liable to pay damages or mesne profits from 11-8-1975 until the delivery of the vacant possession of the accommodation. During the course of its decision this Court referred to a decision of the Madhya Pradesh High Court in Kikabhai Abdul Hussain v. Kamlakar [1974 MPLJ 485] wherein the High Court had held that if a person continues to be in occupation after the termination of the contractual tenancy then on the passing of the decree for eviction he becomes a wrongful occupant of the accommodation since the date of termination. This Court opined that what was held by the Madhya Pradesh High Court seemed to be a theory akin to the theory of "relation back" on the reasoning that on the passing of a decree for eviction, the tenant's possession would become unlawful not from the date of the decree but from the date of the termination of the contractual tenancy itself. It is noteworthy that this Court has not disapproved the decision of the Madhya Pradesh High Court in Kikabhai Abdul Hussain case [1974 MPLJ 485] but distinguished it by observing that the law laid down in Kikabhai Abdul Hussain case[1974 MPLJ 485] was not applicable to the case before it in view of the definition of "tenant" as contained in the M.P. Act and the provisions which came up for consideration of the High Court in Kikabhai Abdul Hussain case [1974 MPLJ 485] were different." (emphasis supplied)
16. As clearly laid down by the Supreme Court in the aforesaid decision, under the general law and in cases where the tenancy is governed only by the provisions of the Transfer of Property Act 1882, once the tenancy comes to an end by determination of the lease under section 111 of the Transfer of Property Act, 1882 the right of the tenant to continue in possession of the premises comes to an end and for any period thereafter for which he continues to occupy the premises, he becomes liable to pay damages at the rate at which the landlord could have let out the premises. In other words, after the expiry of the period of the termination notice, the tenant would be liable to pay fair market compensation and not from the date of the decree. I must hasten to add that different considerations apply when an eviction decree is passed against a tenant who is protected under the provisions of the Maharashtra Rent Control Act, 1999. In such a situation and as held by a series of decisions of the Supreme Court including in Atma Ram Properties (P) Ltd. (supra), the occupation of the tenant of the suit premises in such a case is unlawful after the decree is passed in an eviction suit. However, that would not be the case where the tenancy is governed under general law and only by the provisions of the Transfer of Property Act, 1882. I must also mention here that this point was specifically raised by the Defendant in their affidavit in reply to the Stay Application (Exh.7). In paragraph 2 of the reply, it is specifically contended that the occupation and possession of the suit premises by the Defendant after the termination notice is wrongful and as such the Plaintiff is entitled to mesne profits from one month after the date of the termination notice (9th January 2012). This argument has not even been considered in the impugned order and there are no findings on this aspect either.
17. I am unable to agree with the submissions of Mr Karande that since the inquiry under Order XX Rule 12 of the CPC is yet to take place, the Appellate Authority cannot order interim compensation from the expiry period of the termination notice but can only do so from the date of the decree. In a case where the tenancy is governed under general law and only on the basis of the provisions of the Transfer of Property Act 1882, the occupation and possession of the tenant / lessee is clearly wrongful on the expiry period of the termination notice. This being the case, it is immaterial whether an inquiry under Order XX Rule 12 of the the CPC has been completed or otherwise. This is a condition that is fixed for granting stay of the execution of the decree and to compensate the Plaintiff because the fruits of his decree have been delayed by granting a stay. This compensation is normally deposited in the Appellate Court and unless exceptional circumstances are made out, the Plaintiff is not allowed to withdraw this amount. This being the case, I do not find any merit in the submission of Mr Karande that under Order 41 Rule 5, the Appellate Court can only order interim compensation from the date of the decree and not otherwise. Even on going through Order 41 Rule 5 I do not find any such fetter on the power of the Court as was sought to be contended by Mr Karande. This argument of Mr Karande therefore stands rejected.
18. This now only leaves me to decide that in the facts of the present case what would be the date from which interim compensation ought to have been awarded by the Appellate Authority. As mentioned earlier, section 106 of the Transfer of Property Act, 1882 clearly stipulates that in the absence of a contract or local law or usage to the contrary, the lease of immovable property for agricultural or manufacturing purposes shall be deemed to be a lease from year to year terminable on the part of the lessor or the lessee by six months' notice. A lease of immovable property for any other purpose shall be terminable on the part of either the lessor or the lessee by 15 days' notice. In the facts of the present case, it is the case of the Plaintiff that an open plot of land was leased to the Defendant which was not leased out for any agricultural or manufacturing purposes. This being the case, at least prima facie, the possession and occupation of the suit premises by the Defendant would be unlawful on the expiry of 15 days from the date of the termination notice (viz. 9th January, 2012). In other words, the possession and occupation of the Defendant would be wrongful from 25th January, 2012. This being the case, I am of the view that the compensation that ought to have been fixed by the Appellate Authority of Rs.1,50,000/- per month, should have been from 1st February, 2012 till the disposal of the Appeal.
19. Looking to my findings given and for the reasons set out earlier, I pass the following order :-
ORDER
The execution of the decree dated 3rd May, 2016 passed in T.E. Suit No.114/142 of 2012 is stayed until the final decision in Appeal No.303 of 2016 pending before the Appellate Bench of the Small Causes Court, Mumbai subject to:-
(a) the Petitioner depositing arrears of interim compensation at the rate of Rs.1,50,000/- per month from 1st February, 2012 to 30th September, 2016 within a period of one year from today. Needless to clarify that credit will be given for the amount of Rs.7,50,000/- already deposited by the Defendant towards arrears as ordered by the Appellate Bench in the impugned order.
(b) From 1st October, 2016 onwards, the Defendant shall continue to deposit interim monthly compensation at the rate of Rs.1,50,000/- per month pending the hearing and final disposal of Appeal No.303 of 2016. This shall be deposited on or before the 10th day of each month.
(c) As far as the other directions in the impugned order are concerned, they shall continue to operate.
20. The impugned order is modified in the aforesaid terms and rule is made absolute accordingly. However, in the facts and circumstances of the case, there shall be no order as to costs.
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