[Cites 13, Cited by 0]
Bombay High Court
The Oriental Insurance Company Ltd. vs D.J. Shukla And Company on 5 January, 2026
2026:BHC-AS:85
Digitally signed
VARSHA by VARSHA
VIJAY RAJGURU
VIJAY Date:
RAJGURU 2026.01.05
18:14:04 +0530
2-CRA-672-2009.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
varsha
CIVIL APPELLATE JURISDICTION
CIVIL REVISION APPLICATION NO. 672 OF 2009
The Oriental Insurance Company Ltd )
A govt company having its Head Office, )
at Asaf Ali Road, New Delhi and its )
Mumbai Regional Office No.1 at Orienta )
House 7, J. Tata Road, )
Mumbai 400 020. )... Applicant
(Org. Respondent)
Versus
D.J Shukla and Company )
Cabin No.4, Mezzanine floor, )
Oriental House, 7, J. Tata Road, )
Mumbai 400 020 and 37, )
New Marine Lines, Mumbai 400 020 )..Respondent
(Orig. Appellant)
Mr. V.Y. Sanglikar for Applicant
CORAM : GAURI GODSE, J.
RESERVED ON : 18th SEPTEMBER 2025
PRONOUNCED ON : 5th JANUARY 2026
JUDGMENT :
-
1. This civil revision application is filed under Section 115
of the Civil Procedure Code, 1908 ('CPC') to challenge the
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order passed by the learned City Civil Court in the appeal
preferred by the respondent to challenge the order of eviction
and damages passed by the Estate Officer under the Public
Premises (Eviction of Unauthorised Occupants) Act, 1971
('said Act').
2. Learned counsel for the applicant submitted that during
the pendency of this civil revision application, the possession
of the subject premises was handed over to the applicant.
Accordingly, in the present civil revision application, the only
issue to be decided is the applicant's claim for damages
arising from the respondent's unauthorised occupation.
BASIC FACTS:
3. The proceedings are initiated in respect of the
premises, which consist of a cabin on the mezzanine floor of
a building known as the Oriental House, owned by the
applicant. The respondent occupied the subject premises in
the said building as a monthly tenant of the applicant.
4. The applicant issued a notice dated 13 th March 2001
terminating the lease in favour of the respondent, on the
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grounds of default in payment of rent and other charges, and
breach of the terms and conditions by changing the user of
the premises from an office to a godown. The respondent
was therefore called upon to vacate the premises within one
month, failing which the respondent would be liable to pay
damages for the unauthorised occupation. The respondent
was also informed about the payment of the arrears at 24%
interest and thus called upon the respondent to pay the
arrears within two weeks. Thereafter, the applicant filed an
application for eviction and damages before the Estate
Officer. The show cause notice for eviction was issued by the
estate officer on 6th September 2001 on the ground that the
lease was terminated and the respondent was in
unauthorized occupation since 1st May 2001. A notice dated
6th September 2001 was also issued under Section 7(3) of
the said Act for payment of damages.
5. The estate officer held that the respondent was in
unauthorised occupation and the tenancy was terminated by
a valid notice. The applicant was held entitled to an order of
eviction and to recover arrears of rent and damages at the
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rate of Rs. 6,900/- per month from 1 st May 2001 till the date
of actual delivery of the possession, along with simple
interest at 9% per annum. However, in an appeal preferred
by the respondent, the first appellate court held that the lease
was valid and subsisting upto 2003, and there was no valid
termination of tenancy. It was held that the respondent paid
the arrears of Rs. 32943/- by cheque along with a letter
dated 28th March 2001; hence, in view of receipt of the
arrears as demanded, the forfeiture under Section 111(g) of
the Transfer of Property Act ("the TP Act") stood waived
under Section 112 of the TP Act. It was held that although the
respondent had shifted to a new office premises, the subject
premises was not fully closed; hence, there was no change
in user. The first appellate court allowed the respondent's
appeal and reversed the estate officer's order.
SUBMISSIONS ON BEHALF OF THE APPLICANT:
6. Learned counsel for the applicant submitted that a
Section 7 notice was issued in the prescribed Form-F,
claiming damages arising from the termination notice dated
13th March 2001, as the respondent's occupation was
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unauthorised. Once the requirement of termination of
tenancy as contemplated under Section 106 of the TP Act is
satisfied, the respondent's occupation becomes unauthorised
as his authority to occupy the premises ends. The notice of
termination dated 13th March 2001 is validly issued as
contemplated under Section 106 of the TP Act. According to
the learned counsel for the applicant, since it was a monthly
tenancy, the requirement to issue notice was 15 days. The
eviction application was filed on 28 th August 2001. Therefore,
the requirement of 15 days' notice under Section 106 was
satisfied and thus, in view of Section 7 of the said Act, the
applicant is entitled to recover damages.
7. Learned counsel for the applicant relied upon the list of
documents produced before the estate officer to support the
quantification of damages claimed by the applicant. He
submitted that the respondent led no evidence to controvert
the applicant's evidence in support of the quantification of the
damages. The respondent failed to make any payment
following service of the termination notice. Accordingly, for
the quantification and assessment of damages, the estate
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officer rightly ordered payment under Section 7 of the said
Act.
8. Learned counsel for the applicant submits that an
unregistered lease would be a monthly lease and thus, there
was a valid termination of the tenancy and the occupation of
the respondent was rendered unauthorised. To support his
submissions, learned counsel for the applicant relied upon
the decision of the Hon'ble Apex Court in the case of Babulal
Agrawal Vs. Food Corporation of India and Others 1. He
submitted that the learned appellate court erred in holding
that, upon receipt of the notice dated 13 th March 2001, the
respondent paid the demanded amount, and as no evidence
was adduced to show that the applicant had accepted the
amount under protest, there was no valid termination of the
lease.
9. Learned counsel for the applicant submits that the
appellate court erroneously held that, as the period of the
lease agreement was extended, as per clause (e) of the
lease agreement of 1971, the notice period was 90 days for
1 (2004) 2 SCC 712
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valid termination of the lease. Because the 90-day
termination notice was not issued, there was no valid
termination of the tenancy. According to the learned counsel
for the applicant, the appellate court has ignored that, under
Section 106 of the TP Act, notice of termination requires 15
days, as the respondent's tenancy continued without any
registered agreement. Considering the date of filing the
application for eviction, there was sufficient compliance with
the required period for termination of the tenancy. Hence, the
appellate court has erroneously held that the respondent
cannot be held as an unauthorised occupier and therefore
would not be liable to make payment towards damages.
10. Learned counsel for the applicant submitted that even if
the possession of the suit premises is handed over, the
applicant would be entitled to get the impugned order
reversed on the point of valid termination of tenancy and the
applicant's entitlement to seek damages. Once the
termination of tenancy is accepted as a valid termination as
held by the estate officer, the estate officer's order for
payment of damages needs to be restored. He submits that,
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although possession has been handed over, the applicant is
entitled to recover damages from the date of termination until
the date of handover of possession, i.e., 23 rd March 2023.
Learned counsel for the applicant, therefore, submits that the
impugned order be set aside and the estate officer's order be
restored.
CONSIDERATION AND ANALYSIS:
11. Though served with the notice of the final disposal of
this civil revision application, no one appears for the
respondent. I have considered the submissions made on
behalf of the applicant. I have perused the relevant
documents relied upon by the learned counsel for the
applicant. There is no dispute that the tenancy agreement
was initially executed for a period of three years, i.e. from
1st June 1970 to 31st May 1973, with a monthly rent of
Rs. 207/-. The lease deed was executed by the erstwhile
company, the New Great Insurance Company, which merged
with the applicant company. The applicant continued to
receive the rent, water, and electricity charges from the
respondent. The record shows that the applicant offered to
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renew the lease by issuing a letter dated 2 nd November 1995.
Earlier, the monthly rent was fixed at Rs. 540/- and service
charge at Rs. 519/- per month, with an increase of 25% after
five years from 1st April 1993. of Rs. 1059/- for a period of 10
years from 1st April 1993 and with a provision for an increase
in rent by 25% after 5 years. Thus, as on 1 st April 1998, the
rent of Rs. 675/- and repairs and maintenance charges of Rs.
649/- per month were fixed. No agreement was executed
after the expiry of the initial three-year period as per the
lease deed. Thus, after determination of lease by efflux of
time, the respondent continued to occupy the premises and
make payment of rent as per the terms agreed between the
parties.
12. The applicant thereafter issued a notice of termination
dated 13th March 2001. It was contended that despite
repeated demands the respondent had defaulted in payment
of arrears of rent and that the premises had been locked for
a long period and were unauthorisedly used as a godown.
Thus, the applicant initiated the proceedings under the said
Act for eviction and for damages. A show cause notice was
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issued by the estate officer under Section 4(2) and Section
7(3) of the said Act. The respondent responded to the show-
cause notice and raised preliminary objections to the notice
of termination. The respondent denied any change in the use
of the premises as alleged. The respondent contended that,
as demanded, the arrears of rent were paid, and that the
respondent was no longer in arrears of rent. Hence, the
respondent contended that they were not in unauthorised
occupation of the premises and that the applicant was not
entitled to seek eviction or any damages.
13. On the issue of termination of tenancy, the estate
officer held that the tenancy was terminated by the
termination notice dated 13th March 2001, upon expiry of the
next calendar month from the date of service of the notice of
termination upon the respondent. The notice dated 13 th
March 2001 was received by the respondent on 21 st March
2001. Accordingly, the estate officer accepted the valid
termination of the tenancy under Section 106 of the Transfer
of Property Act.
14. So far as the allegations of the breach of terms and
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conditions are concerned, the estate officer held that the
respondent violated the terms and conditions of the
agreement by keeping the premises locked for a long time
and by using it as a godown. Hence, based on the evidence
on record, the estate officer held that there was a change in
use of the premises. Since the valid termination of the
tenancy was accepted, the estate officer held that the
applicant was entitled to recover damages.
15. As to the evidence supporting the quantification of
damages, the applicant produced relevant evidence, which
was accepted by the estate officer. There is no dispute that
the respondent failed to lead any evidence to controvert the
evidence on the quantification of damages. However, the
appellate court reversed the estate officer's findings on the
valid termination of the tenancy. It was held that without a
valid termination of tenancy, the respondent cannot be held
to be in unauthorised occupation. On the point of change in
user, the appellate court disbelieved the applicant's
contention.
16. The appellate court held that the applicant produced no
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evidence that the cheque amount was received under
protest. Accordingly, once the demanded amount was
received, the respondent was not in arrears. It was held that
once the demanded amount was accepted without protest,
the forfeiture as per clause (g) of Section 111 was waived as
per section 112 of the TP Act. On the issue of the period for
service of the termination notice, the appellate court held that
as per clause (e) of the lease deed, termination of the period
of three months was stipulated, and thus, for want of
sufficient time in the termination notice, the notice was not
accepted as a valid termination. The appellate court thus
held that 90 days' notice as contemplated under the lease
deed was not issued and hence, there is no valid termination
of tenancy. Thus, on the ground of the invalid termination of
the tenancy, the eviction order and the order of damages by
the estate officer was reversed.
17. To consider the submissions on the valid termination of
tenancy, it is necessary to refer to Sections 111 and 106 of
the TP Act, which provides a fifteen-day notice for termination
of a monthly tenancy. The Apex Court in Food Corporation of
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India Ltd., held that in the absence of a lease deed or a
registered lease deed, a tenancy is a monthly tenancy
terminable by fifteen days' notice under Section 106 of the
TP Act. The determination of lease is provided under Section
111 of the TP Act. Clause (g) of Section 111 provides for
determination of lease by forfeiture as explained in the said
clause. Therefore, mere breach of any terms and conditions
will not attract forfeiture, unless there is an express condition
of re-entry by the lessor, in case of breach. Therefore, in the
absence of a fresh lease deed or renewal of the lease deed,
after determination of the lease by efflux of time as provided
under clause (a) of Section 111, if a lessee remains in
possession and the lessor accepts rent or otherwise assents
to continue in possession, it would be the effect of holding
over as provided under Section 116 of the TP Act. Therefore,
in such contingency in the absence of an agreement to the
contrary, the lease would be renewed from year to year, or
from month to month, according to the purpose for which the
property was leased, as specified in Section 106 of the TP
Act. Therefore, such lease can be terminated on expiration of
a notice under Section 106 read with clause (h) of Section
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111 of the TP Act.
18. In the present case, admittedly, after the expiry of the
initial lease period under the lease deed, no fresh deed was
executed. The lease as per the lease deed was determined
by efflux of time. However, the respondent continued in
possession as per the terms and conditions agreed between
the parties for payment of monthly rent for use of the subject
premises for office purpose. In the absence of a fresh lease
deed, the respondent continued in possession on payment of
the monthly rent for use of the premises as office, as
contemplated under Section 116 of the TP Act. Therefore,
clause (g) of Section 111 of the TP Act, will not attract in the
present case. Hence, waiver of forfeiture under Section 112
of the TP Act would not apply. Thus, determination of lease,
in the present case is not under clause (g) but it is under
clause (h) of section 111 of the TP Act. The ninety-day
termination clause in the initial lease deed, which expired at
the end of the lease term, shall not apply. Therefore, the
tenancy is rightly terminated by a fifteen-day notice under
Section 106 of the TP Act. Receipt of the notice dated 13 th
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March 2001 terminating the tenancy is not disputed. The
eviction application under the said Act was filed on 28 th
August 2001. Thus, the tenancy was validly terminated as
contemplated under Section 111 (h), read with Section 106 of
the TP Act. Accordingly, the findings of the appellate court
regarding the waiver of forfeiture under Section 112 read with
Section 111(g) of the TP Act are unsustainable in the facts of
the present case. As per Section 2(g) of the said Act, the
occupation is unauthorised after the authority under which
the occupation was allowed has been determined for any
reason whatsoever. Therefore, once the termination as per
the notice under Section 106 is held valid, the respondent's
occupation would be rendered unauthorised from the date of
expiry of the period of notice. Thus, the respondent would be
liable to pay damages as held by the estate officer.
19. As far as quantification and the amount of damages is
concerned, the appellate court reversed the estate officer's
order only on the ground of an invalid termination notice. No
reasons are recorded by the appellate court to disbelieve the
applicant's evidence on the quantification of damages. The
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estate officer's findings on quantification of damages are not
disturbed. The respondent failed to produce any evidence to
controvert the quantification of the amount towards damages
claimed by the applicant. Thus, once the notice of
termination is held valid, the findings recorded by the estate
officer in quantifying damages based on the evidence on
record must be upheld. The impugned order shall therefore
warrant interference.
20. For the reasons recorded above, the civil revision
application is allowed by passing the following order:
a) The judgment and order dated 29 th July 2009 passed
by the City Civil Judge, Greater Bombay, in
Miscellaneous Appeal No. 138 of 2008 is quashed and
set aside. Miscellaneous Appeal No. 138 of 2008 is
dismissed.
b) The judgment and order dated 5 th March 2008 passed
by the Estate Officer in Case Nos. 5, 5A and 5B of
2001 is confirmed.
(GAURI GODSE, J.)
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