Inmacs Ltd. vs Prema Sinha & Ors.
2008 Latest Caselaw 1741 Del

*                 IN THE HIGH COURT OF DELHI

+                     RFA No.341/2007

           INMACS LTD.                    ..... Appellant
               Through: Mr. Vijay K.Jain, Advocate

                           versus

           PREMA SINHA & ORS.           ..... Respondents
               Through: Mr. Sachin Datta, Advocate

                        RESERVED ON:
                         18.09.2008

                      DATE OF DECISION:
%                         26.9.2008

     CORAM:

     Hon'ble Mr.Justice Pradeep Nandrajog
     Hon'ble Mr.Justice J.R.Midha

1.   Whether reporters of local papers may be allowed
     to see the judgment?

2.   To be referred to the Reporter or not?

3.   Whether judgment should be reported in Digest?

:    PRADEEP NANDRAJOG, J.

1. Vide a registered deed of lease dated 8.11.2001,

Ex.PW-1/4, flat No.503, 43 Nehru Place, New Delhi in the

building popularly known as Chiranjiv Tower was let out to the

appellant by late Mr.K.K.Sinha and his wife Smt. Prema Sinha.

On death of Mr.K.K.Sinha his children i.e. a daughter and two

sons, along with their mother stepped into his shoes. The

tenancy was for a period of 3 years with a covenant [clause III

(1)] that if the lessee is desirous of having the lease renewed

for a further term of 3 years, the lessee shall give at least 3

months' notice in writing before the expiration of the term of

the lease intimating his intention to have the lease extended

but the same would be at the increased rent by 10% of the

existing rent which was fixed at Rs.14,476/-.

2. The lease being for a period of 3 years came to an

end on 7.11.2004. Admittedly, no notice in writing as per the

requirement of clause III (1) was given by the appellant in

writing and admittedly no fresh lease deed was executed

between the parties, much less registered. But, the appellant

continued to tender Rs.14,476/- per month even after

7.11.2004 and the lessors continued to accept the same. 5

letters under which the last agreed rent i.e. Rs.14,476/- was

tendered are Ex.PW-1/D-1 to Ex.PW-1/D-5 written in the month

of January, February, March, April and May 2006. It is also the

admitted position between the parties that even for the prior

months the last paid rent was tendered in sum of Rs.14,476/-

and accepted by the lessors.

3. On 27.9.2005, vide Ex.PW-1/9, a legal notice was

issued by the lessors to the appellant stating as under:-

"Under the instructions from and on behalf of my clientess Smt. Prema Sinha, W/o Shri K.K.Sinha, R/o N-91, Greater Kailash, Part-I, New Delhi-

110048, I hereby serve you with the following notice:-

That vide Lease Deed dated 08.11.2001, my clientess let out the premises as described below, for an initial period of three years which expired on 7th November 2004.

That as per the terms of the lease deed dated 08.11.2001 you failed to give three month's notice of your intention to renew the lease deed for further period of three years with the increase in the rent @ 10%; but you continued to pay the use and occupation charges @ Rs.14476/- per month, hence you have become an unauthorized occupant and liable to pay damages at the prevalent market rent i.e. @ Rs.50,000/- per month.

Further you are also advised to clear all other dues, if any to Municipal Authorities and for maintenance to M/s Star Estates Management Pvt. Ltd. and restore the demised premises to their original condition as per the lease agreement.

By virtue of this notice I hereby call upon you to deliver the vacant possession of the premises described below to my clientess within one month from the date of receipt of this notice and also pay the damages @ Rs.50,000/- per month from 08.11.2004 till you hand over the vacant and peaceful possession of the premises in question to my clientess.

In case you fail to comply with this notice, my client shall be constrained to initiate legal proceedings against you in the court of law for your prosecution in accordance with law at your cost and risks that too without any further reference;

DESCRIPTION OF PROPERTY: FLAT NO.503, FIFTH FLOOR, CONTAINING ONE HALL & TOILET

MEASURING 517 SQ. FT. CHIRANJIV TOWER, 43, NEHRU PLACE, NEW DELHI.

A copy of this notice is being retained in records for necessary steps, in case of non-compliance with this legal notice."

4. Another legal notice dated 29.3.2006, Ex.PW-1/16,

was issued by the lessors to the appellant which reads as

under:-

"Dear Sir,

Under the instructions from and on behalf of my client's viz (1) Smt. Prema Sinha, W/o Lat Sh. K.K.Sinha, and (2) P.Pallav Sinha S/o Late Shri K.K.Sinha, & (3) Padmanabh Sinha S/o Lat Sh. K.K.Sinha, all residents of N-91, Greater Kailash-I, New Delhi-110048 and (4) Neelanjana Singh W/o Dr. Dinesh Singh and D/o Late Sh.K.K.Sinha, R/o 33, Deshbandhu Apartments, Kalkaji, New Delhi, I hereby serve your with the following notice:-

That vide registered Lease Deed dated 08.11.2001 property Flat No.503, Fifth Floor, Chiranjiv Tower, 43, Nehru Place, New Delhi was let out for an initial period of three years, by its joint owners Mr. K.K.Sinha and his wife Smt. Prema Sinha which expired on 07.11.2004.

That after the death of Mr.K.K.Sinha, his legal heirs namely his wife smt. Prema Sinha and his sons viz. P.Pallav Sinha and Padmanabh Sinha and his daughter Neelanjana Singh were attorn by you (Lessee) sharing the rent of the abovesaid property of Late Shri K.K.Sinha's share in equal proportion.

That as per the terms of the lease deed dated 08.11.2001 you failed to give three month's

notice of your intention to renew the lease deed for further period of three years with the increase in the rent @ 10%; but you continued to pay the use and occupation charges @ Rs.14476/- per month, hence you have become an unauthorized occupant and liable to pay damages at the prevalent market rent i.e. @ Rs.50,000/- per month.

Further you are also advised to clear all other dues, if any to Municipal Authorities and for maintenance to M/s Star Estates Management Pvt. Ltd. and restore the demised premises to their original condition as per the lease agreement.

That earlier also a Legal Notice dated 27.09.2005 was sent to you, but you abundant caution this legal notice is again addressed to you.

By virtue of this notice I hereby call upon you to deliver the vacant possession of the premises described below to my clientess within one month from the date of receipt of this notice and also pay the damages @ Rs.50,000/- per month from 08.11.2004 till you hand over the vacant and peaceful possession of the premises in question to my clientess.

In case you fail to comply with this notice, my client shall be constrained to initiate legal proceedings against you in the court of law for your prosecution in accordance with law at your cost and risks that too without any further reference;

DESCRIPTION OF PROPERTY: FLAT NO.503, FIFTH FLOOR, CONTAINING ONE HALL & TOILET MEASURING 517 SQ. FT. CHIRANJIV TOWER, 43, NEHRU PLACE, NEW DELHI.

A copy of this notice is being retained in records for necessary steps, in case of non-compliance

with this legal notice."

5. On 30.5.2006, the lessors filed a suit seeking

ejectment of the appellant and mesne profits @ Rs.50,000/-

per month with effect from 8.11.2004. It was asserted in the

plaint that the tenancy expired by efflux of time on the mid-

night of 7.11.2004 and hence the possession of the appellant

in respect of the tenanted premises became unauthorized from

8.11.2004. Reference was made, in para 8 of the plaint, to

Ex.PW-1/9 and Ex.PW-1/16.

6. In the written statement, appellant stated that after

the expiry of the lease period, it approached the lessors and

requested that the appellant may be permitted to continue to

occupy the tenanted premises as a monthly tenant at the old

rate of rent which was agreed to by the lessors since the actual

rent had come down. It was pleaded that the appellant

became a tenant from month to month as per the said oral

agreement. Receipt of Ex.PW-1/9 and Ex.PW-1/16 was denied.

Qua the said documents an alternative plea was taken that

even otherwise the 2 notices are not valid as they do not

determine the tenancy.

7. The plea of the appellant pertaining to the oral

monthly tenancy is as pleaded in para 6 of the written

statement, relevant portion whereof reads as under:-

"6. ..... It is submitted that after the expiry of the lease period, the defendant approached the plaintiff and requested that the possession of the premises in dispute under the tenancy of the defendant may be taken as period of lease expired. At that time the rent in the locality had gone down and the premises in dispute could not have fetched the rent on which it was let out to the defendant. The plaintiff asked the defendant to continue as a monthly tenant in the premises in dispute at the old rent, therefore monthly tenancy was arrived at between the plaintiff and the defendant and on the request of the plaintiff, the defendant continued to be a monthly tenant after the expiry of 8.11.2004 as per the understanding and contract between the plaintiff and the defendant after 8.11.2004."

8. Needless to state on the rival versions of the parties

the only issue which arose for determination was whether the

tenancy of the appellant stood determined and if so, its effect.

It would be relevant to note that the relationship of the

landlord and tenant was not in dispute and it was also not in

dispute that when let out, the agreed rent was Rs.14,476/- per

month and hence the provisions of the Delhi Rent Control Act

1958 did not apply to the premises let out.

9. Holding that under the registered lease deed Ex.PW-

1/4 the tenancy expired on the mid-night of 7.11.2004 and

since the appellant did not prove having intimated by serving a

notice in writing to the lessors that it would like to continue

with the tenancy for a period of another 3 years and admittedly

no fresh rent deed was executed, much less registered, it has

been held that the status of the appellant after 8.11.2004 was

that of an unauthorized occupant. It has been held that the

defence that Ex.PW-1/9 and Ex.PW-1/16 were not served upon

the appellant was false for the reason Ex.PW-1/10 and Ex.PW-

1/11 evidence that the notice Ex.PW-1/9 was sent by Regd.

A.D.Post at the tenanted premises and also at the registered

office of the appellant at Darya Ganj. The A.D.Cards, Ex.PW-

1/14 and Ex.PW-1/15 establish the receipt thereof by the

appellant. Similarly, it has been held that the notice dated

29.3.2006, Ex.PW-1/16 was sent to the appellant at its

registered office as also at the tenanted premises under postal

receipts Ex.PW-1/17 and Ex.PW-1/18 and that the A.D.Cards

Ex.PW-1/21 and Ex.PW-1/22 evidence receipt thereof by the

appellant at both addresses. So holding, a decree for

ejectment has been passed against the appellant directing that

possession of the tenanted flat be handed over to the lessors.

Holding that the lessors are entitled to mesne profits after

8.11.2004, but noting that no evidence was led by the lessors

of rents increasing in the locality the agreed rent i.e.

Rs.14,476/- per month has been awarded as mesne profits.

10. At the hearing held on 18.9.2008, Sh.Vijay K.Jain,

learned counsel for the appellant urged that Ex.PW-1/D-1 to

Ex.PW-1/D-5 show that the appellant tendered Rs.14,476/- per

month as rent and each month the same was accepted as rent.

Thus, counsel urged that the plea of the appellant of being a

tenant from month to month stands established from said

document. Counsel further urged that the recital to Ex.PW-1/4,

the lease deed dated 8.11.2001, uses the expression that the

lease is 'for the initial term of three years'. It was urged that

this shows that the lease was intended to be continued. Lastly,

counsel urged that Ex.PW-1/9 and Ex.PW-1/16 do not validly

terminate the tenancy as it has not been so stated in the said

documents. We may note that learned counsel for the

appellant did not dispute that his client had received Ex.PW-1/9

and Ex.PW-1/16.

11. From the narration of facts aforenoted it is apparent

that the facts are not in dispute and the questions being, one

which arise very often - rather are raised very often - whether

the status of the appellant was that of a tenant holding over

from month to month.

12. Section 105 of the Transfer of Property Act, 1882

defines a lease of an immovable property as a transfer of a

right to enjoy immovable property for a certain time, or in

perpetuity, in consideration of a price paid or promised, or of

money, a share of crops, service or any other thing of value,

to be rendered periodically or on specified occasions to the

transferor by the transferee who accepts the transfer on such

terms. The transferor is called the lessor and the transferee is

called the lessee. The price is called the premium and the

money, share, service or other thing to be so rendered is called

the rent.

13. Section 106 of the Transfer of Property Act 1882

deals with the duration of leases and states that 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 month's

notice and a lease of immovable property for any other

purpose shall be deemed to be lease from month to month,

terminable, on the part of either lessor or lessee by 15 days'

notice. Section 107 of the Transfer of Property Act, 1882

stipulates that a lease of immovable property from year to

year, or for any term exceeding 1 year can be made only by

and under a registered instrument. Law is clear. If a lease is

evidence by a contract, as in the instant case, the duration of

the lease would be as per the contract and at the expiry of the

lease period as per contract the lease expires by efflux of time.

Expiry of lease by efflux of time results in the determination of

the relationship between the lessor and the lessee and since

the lease expires under the contract by efflux of time, no

notice of determination of the lease is required.

14. Once a lease expires, the mandate of clause q of

Section 108 of the Transfer of Property Act 1882 makes it the

bounden duty of the lessee to put the lessor into possession of

the leased premises.

15. To the extent aforenoted there is no problem in law,

but as in the present case, more often than not, rent is

tendered post expiry of the lease period by efflux of time and

accepted by the landlord. What happens?

16. Section 116 of the Transfer of Property Act 1882

reads as under:-

"116. Effect of holding over-If a lessee or under-lessee of property remains in possession thereof after the determination of the lease granted to the lessee, and the lessor or his legal representative accepts rent from the lessee or under- lessee, or otherwise assents to his continuing in possession, the lease is, in the absence of an agreement to the contrary, renewed from year to year, or from month to month, according to the purpose for which the property is leased, as specified in section 106."

17. On the strength of having paid the last agreed rent

the tenant is naturally expected to claim that his status is that

of a tenant holding over and till tenancy is determined by a

notice under Section 106 of the Transfer of Property Act 1882

the status continues.

18. As noted above, mandate of clause q of Section 108

of the Transfer of Property Act 1882 is that on the expiry of the

lease the lessee is bound to hand over possession of the

leased premises to the lessor and therefore the lessor would

be entitled to maintain an action to compel the lessees to

abide by the mandate of clause q of Section 108 of the

Transfer of Property Act 1882.

19. A person who enters upon the property of another

without authority of law is a trespasser. It could be argued

that the very next moment after the period of lease stands

expired the act of entering upon property by the tenant is an

act of trespass. But law says no. A lessee who continues in

possession after expiry of the lease, without the consent of the

lessor or without any agreement between the parties or in

disagreement with the lessor, is treated in law as a tenant by

sufferance. But where the lessor consents to the continued

possession of lessee on the same terms and conditions as per

the original lease a tenancy by holding over comes into

operation.

20. The words "accepts rent or otherwise assents to his

continuing in possession" in Section 116 of the Transfer of

Property Act contemplates that from the side of the lessee

there should be an offer to take a new lease and on the side of

the lessor there must be a definite consent to the continuation

of possession. In other words there must be a bilateral

contract.

21. Such a bilateral contract could be express or

implied. Thus mere continuance of possession after the expiry

or determination of the lease is not enough to entitle the

tenant to establish tenancy by holding over.

22. More often than not, the only evidence which

surfaces is the tender of rent and its acceptance by the

landlord. As observed in the decision reported as AIR 1951 SC

285, Eastern Investment Ltd. Vs. Commissioner of Income Tax

the acceptance of rent is only one form of the assent of the

lessor to the lessee remaining in possession of the property.

But, as observed in the decision reported as AIR 1949 FC 124,

Kai Khushroo Bezonjee Capadia Vs. Bai Jerbai Hirjibhoy Warden

& Anr., the acceptance must be of rent as such.

23. Since law requires a bilateral agreement between

the parties for the tenant continuing to holding over, offer and

acceptance of rent is at best an evidence raising a

presumption of assent but would not amount to a conclusive

proof of such assent. It could be rebutted by other evidence.

24. In order that the acceptance of rent may amount to

assent of the lessor it has to be shown that the offer of rent

was made on the express ground that the lessee intended to

continue the lease and that the acceptance was with the full

knowledge of the nature of the offer. This is a question of fact

which has to be determined from the circumstances of each

case. Greater is the period of continued possession coupled

with receipt of rent, stronger would be the presumption in

favour of the lessee.

25. Where a tenant fails to establish a case of holding

over, his status would be, as noted above, that of a tenant at

sufferance. The difference in the status of a tenant holding

over and a tenant at sufferance was explained by the Supreme

Court in the decision reported as AIR 1996 SC 140, R.V. Bhupal

Prasad Vs. State of A.P. wherein their Lordships said:-

"8. Tenant at sufferance is one who comes into possession of land by lawful title, but who holds it by wrong after the termination of the term or expiry of the lease by efflux of time. The tenant at sufferance is, therefore, one who wrongfully continues in possession after the extinction of a lawful title. There is little difference between him and a trespasser. In Mulla's Transfer of Property Act (7th Edn.) at page 633, the position of tenancy at sufferance has been stated thus: A tenancy at sufferance is merely a fiction to avoid continuance in possession operating as a trespass. It has been described as the least and lowest interest which can subsist in reality. It, therefore, cannot be

created by contract and arises only by implication of law when a person who has been in possession under a lawful title continues in possession after that title has been determined, without the consent of the person entitled. A tenancy at sufferance does not create the relationship of landlord and tenant. At page 769, it is stated regarding the right of a tenant holding over thus: The act of holding over after the expiration of the term does not necessarily create a tenancy of any kind. If the lessee remaining in possession after the determination of the term, the common law rule is that he is a tenant on sufferance. The expression "holding over" is used in the sense of retaining possession. A distinction should be drawn between a tenant continuing in possession after the determination of the lease, without the consent of the landlord and a tenant doing so with the land- lord's consent. The former is called a tenant by sufferance in the language of English law and the latter class of tenants is called a tenant holding over or a tenant at will. The lessee holding over with the consent of the lessor is in a better position than a mere tenant at will. The tenancy on sufferance is converted into a tenancy at will by the assent of the landlord, but the relationship of the landlord and tenant is not established until the rent was paid and accepted. The assent of the landlord to the continuance of the tenancy after the determination of the tenancy would create a new tenancy. The possession of a tenant who has ceased to be a tenant is protected by law. Although he may not have a right to continue in possession after the termination of the tenancy, his possession is juridical.

13. In view of the settled possession of law, the possession of the appellant is as tenant at sufferance and is liable to ejectment in due course of law. But his possession is not legal nor lawful. In other words, his possession of the theatre is unlawful or litiguous possession. The appellant may remain in possession until he is ejected in due course in execution of the decree in the suit filed by the respondent. His possession cannot be

considered to be settled possession. He is akin to a trespasser, though initially he had lawful entry."

26. Dealing with the issue whether accepting rent after

serving upon the tenant a notice to quote amounts to a waiver

under Section 113 of the Transfer of Property Act, in the

decision reported as 2006 (4) SCC 205, Sarup Singh Gupta Vs.

S. Jagdish, their Lordships of Supreme Court held:-

"6 ... A mere perusal of Section 113 leaves no room for doubt that in a given case, a notice given under Section 111, Clause (h), may be treated as having been waived, but the necessary condition is that there must be some act on the part of the person giving the notice evincing an intention to treat the lease as subsisting. Of course, the express or implied consent of the person to whom such notice is given must also be established. The question as to whether the person giving the notice has by his act shown an intention to treat the lease as subsisting is essentially a question of fact. In reaching a conclusion on this aspect of the matter, the Court must consider all relevant facts and circumstances, and the mere fact that rent has been tendered and accepted, cannot be determinative.

7 A somewhat similar situation arose in the case reported in Shanti Prasad Devi vs Shankar Mahto 2005 (5) SCC 543. That was a case where the landlord accepted rent even on expiry of the period of lease. A submission was urged on behalf of the tenant in that case that Section 116, Transfer of Property Act was attracted and there was a deemed renewal, of the lease. Negativing the contention, this Court observed that mere acceptance of rent for the subsequent months in which the lessee continued to occupy the premise even, after the expiry of the period of the lease, cannot be said to be a conduct signifying his assent to the continuing of the lease even after the expiry of the lease period. Their

Lordships noticed the conditions incorporated in the agreement itself, which provided for renewal of the lease and held that those conditions having not been fulfilled, the mere acceptance of rent after expiry of period of lease did not signify assent to the continuance of the lease.

8 In the instant case, as we have noticed earlier, two notices to quit were given on 10th February, 1979 and 17th March, 1979. The suit was filed on 2-6-1979. The tenant offered and the landlord accepted the rent for the months of April, May and thereafter. The question is whether this by itself constitute an act on the part of the landlord showing an intention to treat the lease as subsisting. In our view, mere acceptance of rent did not by itself constituted an act of the nature envisaged by Section 113, Transfer of Property Act showing an intention to treat the lease as subsisting. The fact remains that even after accepting the rent tendered, the landlord did file a suit for eviction, and even while prosecuting the suit accepted rent which was being paid to him by the tenant. It cannot, therefore, be said that by accepting rent, he intended to waive the notice to quit and to treat the lease as subsisting. We cannot ignore the fact that in any event, even if rent was neither tendered nor accepted, the landlord in the event of success would be entitled to the payment of the arrears of rent. To avoid any controversy, in the event of termination of lease the practice followed by courts is to permit the landlord to receive each month by way of compensation for the use and occupation of the premises, an amount equal to the monthly rent payable by the tenant. It cannot, therefore, be said that mere acceptance of rent amounts to waiver of notice to quit unless there be any other evidence to prove or establish that the landlord so intended. In the instant case, we find no other fact or circumstance to support the plea of waiver. On the contrary the filing of and prosecution of the eviction proceeding by the landlord suggests otherwise."

27. In the report published as 2006 (1) SCC 228, C.

Albert Morris vs K. Chandrasekaran it was observed as under:-

"26 ... Much argument was advanced on the receipt of the rent by the landlord after the cancellation of the lease. The consensus of judicial opinion in this country is that a mere continuance in occupation of the demised premises after the expiry of the lease, notwithstanding the receipt of an amount by the quondam landlord would not create a tenancy so as to confer on the erstwhile tenant the status of tenant or a right to be in possession. ...

32 ... We are, therefore, of the opinion that mere acceptance of rent by the landlord, the first respondent herein, from the tenant in possession after the lease has been determined either by efflux of time or by notice to quit would not create a tenancy so as to confer on the erstwhile tenant the status of a tenant or a right to be in possession. We answer this issue accordingly."

28. Similar view has been expressed in the decisions

reported as 2005 (5) SCC 543 Shanti Prasad Devi Vs. Shankar

Mahto, 129 (2006) DLT 338 Central Bank of India Vs. Lalit

Kumar Bhargava, 118 (2005) DLT 52 Yashbir Sharma Vs. Mrs.

Sulakshna Lal, 104 (2003) DLT 158 Delhi Jal Board Vs.

Surendra P.Malik, 2002 (5) AD (Delhi) 7 FCI Vs. Kuljinder Pal

Singh Dhillon and 99 (2002) DLT 139 Sh.Prithvi Raj Bhalla Vs.

Industrial Cables (India) Ltd.

29. It would be interesting to note that in the decision

reported as (1973) 2 SCC 388, Bari Lal vs. Municipal

Corporation of Indore the tenant continued in possession for

nearly 5 years after expiry of the lease and yet was held to be

not holding over. Status held was of a tenant by sufferance.

Meaning thereby that mere time duration of occupation post

tenancy coming to an end by efflux of time is not a very

determinative factor.

30. Since the respondents have neither filed a cross

appeal nor have they filed cross objections and since the so-

called mesne profits have been awarded at the agreed rent,

the issue whether the possession of the appellant became

unauthorized with effect from 8.11.2004 when tenancy came

to an end by efflux of time on the mid-night of 7.11.2004 need

not bother us if we find that the tenancy was validly

determined under either the notice dated 27.9.2005, Ex.PW-

1/9 or the notice dated 29.3.2006, Ex.PW-1/16.

31. But before that we may deal with the submissions

urged by learned counsel for the appellant as noted in para 10

above.

32. We fail to understand the argument that the recital

in the lease deed dated 8.11.2001 uses the expression that the

lease is 'for the initial term of three years' and hence on the

expiry of the lease period the appellant was entitled to

continue to occupy the tenanted premises as a tenant. It has

to be noted that vide clause III (1) of the lease deed Ex.PW-1/4

parties had agreed that at the option of the appellant it could

continue to occupy the tenanted premises for a period of

further three years but on the condition that the appellant

evidenced such intention by serving a notice in writing upon

the lessor at least 3 months before the expiry of the term of

the lease. Learned counsel for the appellant could not identify

any such notice ever being served. The reference in the recital

that the tenancy was initially for a period of 3 years is clearly

relatable to clause III (1) of the lease deed which envisaged a

further lease for a period of 3 years but subject to the

conditions enumerated in said clause being satisfied.

33. Even otherwise said submission is not available to

the appellant inasmuch as, as noted in para 7 above, the case

pleaded by the appellant in the written statement was that

post 8.11.2004, by and under an oral agreement, the appellant

was allowed to continue to occupy the tenanted premises as a

tenant from month to month.

34. The submission of the learned counsel for the

appellant with respect to rent being tendered vide Ex.PW-1/D-1

to Ex.PW-1/D-5 for the months of January 2006 till the month of

May 2006 and its acceptance by the lessors would have a

meaning if there was evidence to show that the lessors

accepted the money offered as rent.

35. Be that as it may, we need not go into this issue for

the reason we find that vide Ex.PW-1/9 as also vide Ex.PW-1/16

the tenancy was validly determined. Assuming that having

received the rent post service of Ex.PW-1/9 we note that post

service of the notice Ex.PW-1/16 on 29.3.2006 the suit for

ejectment was filed soon thereafter on 30.5.2006. Thus, the

lessors would succeed if Ex.PW-1/16 is held to be a valid notice

determining the tenancy.

36. We have noted hereinabove in para 4 the contents

of Ex.PW-1/16. After referring to the fact that the appellant did

not exercise the option to have the lease extended and no

fresh lease deed being executed between the parties the

appellant has been clearly called upon to deliver the vacant

possession of the tenanted premises within 1 month from the

date of the receipt of the notice.

37. Section 106 of the Transfer of Property Act 1882 as

originally enacted required the determination of the tenancy

with reference to the tenancy month by giving a notice of a

time duration specified in sub-Section 1 thereof depending

upon the purpose of the lease. Pertaining to a lease other than

for agricultural and manufacturing purposes the notice

determining the lease had to be served at least 15 days prior

to the expiry of the tenancy month and had to state the

tenancy month. The language of Section 106 as originally

enacted was a source of fertile litigation and the legislature

amended said Section vide Act No.3 of 2003. Vide sub-Section

3 of the Section 106 of the Transfer of Property Act 1882 as

amended, 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.

38. In the instant case, the notice dated 29.3.2006,

Ex.PW-1/16 was received by the appellant as per A.D.Cards

Ex.PW-1/21 and Ex.PW-1/22 around 2nd April 2006 and the suit

in question, as noted above was filed on 30.5.2006.

39. The submission of learned counsel for the appellant

that there is no expressed use of the expression in the notice

that the tenancy stood determined is neither here nor there for

the reason as held in the decisions reported as 1999 (51) DRJ

245 (DB) Capital Boot House Vs. Intercraft Ltd. and 125 (2005)

DLT 161 (DB) Union Bank of India Vs. Sushila Goela & Ors. the

object of a notice is to inform the other party the intention of

the person issuing the notice i.e. that he wants the premises

back. The object of the notice is to give sufficient time to the

tenant to vacate the tenanted premises. A notice under

Section 106 of the Transfer of Property Act has always been

liberally construed.

40. We may only add that there is no statutorily

prescribed proforma of a notice envisaged by Section 106 of

the Transfer of Property Act 1882. As long as the notice can be

reasonably understood by a person of ordinary prudence that

his tenancy has been determined and he is required to vacate

the tenanted premises at the end of the tenancy month, the

notice is fine.

41. Since we have held that the monthly tenancy

claimed by the appellant stood validly determined vide notice

dated 29.3.2006 Ex.PW-1/16 the obvious conclusion has to be

that the impugned judgment and decree ordering the

ejectment of the appellant is legal and valid.

42. That the learned Trial Judge has held the possession

of the appellant as unlawful with effect from 8.11.2004 is a

non-issue for the reason no consequences have flown from

said finding inasmuch as the so-called mesne profits awarded

by the learned Trial Judge against the appellant and in favour

of the lessors is the agreed rent i.e. Rs.14,476/- per month.

43. A last residual issue needs to be decided.

44. Since appellant had prayed that pending decision of

the appeal the operation of the impugned judgment and

decree dated 29.1.2007 be stayed, vide order dated 24.1.2008

a condition was imposed that the appellant would pay use

charges @ Rs.28,000/- per month from 7.11.2004 till 31.1.2008

and thereafter with effect from the month of February 2008 @

Rs.40,000/- per month.

45. Vide order dated 7.2.2008 a local commissioner was

appointed to conduct and inquiry and submit a report as to

what would be the fair market rental of the flat. Vide report

dated 26.3.2001 the learned local commissioner has opined

that the flat would fetch a rental of Rs.75,960/- per month.

46. The order dated 24.1.2008 is an interim order and

hence cannot be treated as a final expression of this Court as

to what would be the fair market rental as on date of the order.

But, prima facie the direction in the order that with effect from

7.1.2004 the appellant shall pay use and occupation charges @

Rs.28,000/- per month cannot be sustained for the period

7.11.2004 till 29.1.2007 for the reason vide impugned

judgment and decree dated 29.1.2007 the mesne profits

determined till possession is delivered has been determined at

Rs.14,476/- per month. It has to be noted that the respondents

i.e. the lessors have not filed any cross appeal or cross

objections challenging the impugned decree in so far it has

determined mesne profits @ Rs.14,476/- per month.

47. At best, a term requiring appellant to pay use

charges in harmony with the current rentals could be imposed

upon the appellant as a condition of stay, post the date of

judgment and decree i.e. 29.1.2007.

48. We note that in the decision reported as (2005) 1

SCC 705 Atmaram Properties (P) Ltd. Vs. Federal Motors (P)

Ltd., ratio whereof was followed in the decisions reported as

2005 (6) SCC 489 Anderson Wright Vs. Amarnath and the

decision reported as 2005 (11) SCC 547 Crompton Grieves Vs.

State of Maharashtra it was held that since the power to grant

a stay is equitable in nature, an applicant seeking stay may, in

equity, be put to suitable terms which would include a

direction that the stay is conditional upon paying a fair market

rental.

49. Determination of fair market rentals in Delhi till the

year 2000 A.D. was not much of a problem because reported

decisions show that with effect from the year 1980 the rentals

rose between 10% to 15% each year depending upon the

locality in which a property was situated. But, post 2000 A.D.

the market started showing a sign of depression for about 2

years with the rentals falling very steeply till about the year

2005 and thereafter increasing in different proportion in

different localities. The instant case has an intrinsic evidence

of our observation hereinbefore recorded in the present para.

The tenancy at hand came to an end on 7.11.2004 and the suit

was filed on 30.5.2006. The lessors led evidence on 9.10.2006

but could not bring any evidence on record that fair rentals of

similar flats at Nehru Place Commercial Complex had

increased. Thus, there is intrinsic that probably till 9.10.2006

there was hardly any increase in the rentals in the area. The

report of the local commissioner is based on information

available on the website of M/s. Magicbricks.com and M/s.

99acres.com. Not much reliance can be placed on the

information downloaded from the website for the reason the

websites contain an invitation to offer and obviously a lessor

would like to receive the highest rent possible. It is settled law

that evidence of fair market rental has to be cogent and clear

with reference to actual lettings of similar situated properties.

50. We are of the opinion that under the circumstances

it would be advisable to leave the issue open as to what would

be the fair rental value of the flat post 29.1.2007, i.e. the date

of the impugned judgment and decree for the reason we grant

liberty to the lessors to sue for damages for the period post

date of impugned judgment and decree till possession of the

flat is handed over for the reason said cause of action would in

any case be available to the landlords and they are still

entitled to file a suit for damages for the period beyond

29.1.2007 till date when possession of the flat is handed over.

51. We find no merit in the appeal.

52. The appeal is dismissed with cost against the

appellant and in favour of the respondents.

PRADEEP NANDRAJOG, J.

J.R.MIDHA, J.

September 26, 2008 mm