Indian Dairy Association vs Syndicate Bank And Ors
2010 Latest Caselaw 3872 Del

*              IN THE HIGH COURT OF DELHI AT NEW DELHI

                                                                  Pronounced on : 19.08.2010

+                               CS(OS) 785/2006

       INDIAN DAIRY ASSOCIATION                                                   ..... Plaintiff

                      Through : Gp. Capt. Karan Singh Bhati, Advocate with
                      Sh. Roshan Chapagain and Ms. Sajoli Mittal, Advocates.

                              Versus

       SYNDICATE BANK AND ORS.                                                    ..... Defendants

                      Through : Sh. V. Sudeer, Advocate.


       CORAM:
       HON'BLE MR. JUSTICE S. RAVINDRA BHAT


1.

     Whether the Reporters of local papers               Yes.
       may be allowed to see the judgment?

2.     To be referred to Reporter or not?                  Yes.

3.     Whether the judgment should be                      Yes.
       reported in the Digest?


MR. JUSTICE S.RAVINDRA BHAT, J (OPEN COURT)

%

1. The plaintiff in the suit seeks a decree for possession and mesne profits for alleged damages towards use and occupation of the premises, (aggregating 3970.60 sq. feet comprising of ground floor and 3700.60 sq. ft. basement). The premises are concededly owned by the plaintiff. The defendant bank entered into an arrangement through a registered lease deed, on 29.03.2000. The tenure of the lease was five years; it expired on 28.03.2005.

2. The plaintiff contend that there was no renewal of the lease deed even though a condition existed as a stipulation of the lease deed. The plaintiff relies upon the relevant condition in the lease deed which is in the following terms:

       "XXXXXX                         XXXXXX                             XXXXXX


CS (OS) 785/2006
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        18)     That the Lessor shall give the said leased premises initially for a period of

five years from the date of execution of this Agreement and this agreement shall terminate on the appointed date. This Agreement, is however renewable through mutual agreement between the parties-lessor and the Bank with a minimum increase of 25% in monthly rent by executing fresh lease deed after the initial period of 5 years.

XXXXXX XXXXXX XXXXXX"

3. The plaintiff submits to having issued a legal notice to the defendants on 25.01.2005, asking the later to hand-over possession since the lease tenure was ending by efflux of time on 31.03.2005. It is submitted that despite this demand, and despite there being no renewal of the lease by mutual agreement, the defendants continued to occupy the premises.

4. The defendants concede that the lease deed was demised for period of 5 years, ending on 28.03.2005. However, they submit that the plaintiff had launched into frivolous litigation in 1995; they also, besides, raise other contentions, stating that despite the tenure having ended, they continued to tender the agreed enhanced amount towards rent, constituting 25% of the then existing rent in accordance with the agreement.

5. It is evident from the bare reading of Clause 18 that the lease could have been renewed only by mutual agreement. The defendants nowhere contend having entered into an agreement nor have they furnished any particulars in this regard. The Court is also mindful of the circumstance that even assuming that such renewal had taken place, further tenure of five years should have ended by now, i.e. 28.03.2010. Having regard to these circumstances, the Court had required the parties to obtain instructions as to whether agreement could be reached as to the time within which the defendant bank would vacate the premises and also the amount payable for the period from 29.03.2005, till date of handing-over possession.

4. Learned counsel for the defendants, after several adjournments, has submitted today that while the bank does not dispute liability to hand-back possession, in principle, it would require at least 18 months' accommodation to continue in the possession of the premises since its Currency Chest is located in the premises and handing-over vacant possession at this stage would be unfeasible. The defendants submit that the existing rate of rent for the basement is ` 25 per square feet. The plaintiff submits further that the market rate for the entire premises is in the range of approximately ` 50 per square feet or more per square feet. It is submitted that even if there was a renewal, there would have been a further 25% increase over the existing rent.

CS (OS) 785/2006 Page 2

5. Having regard to the pleadings of the parties, the Court is satisfied that the defendants have nowhere denied their liability to hand-over vacant possession of the suit premises to the plaintiff after 28.03.2005. No case of the parties having entered into any mutual agreement extending the lease has been established. In these circumstances, the Court would be justified in drawing a decree for possession. The defendants are not disputing such position even today.

6. The defendants argue that the plaintiff's demand for rent in respect of basement for the period after 28.03.2005 at ` 50 per square feet is unreasonable and rely upon a recent letter in respect of another premises located at Sector-4, R.K. Puram where a similar Currency Chest is located. The said letter indicates that lease was renewed for ` 55 per square feet in respect of ground floor and ` 30 per square feet for basement, with additional 15% towards sub-letting charges, w.e.f. 01.04.2009.

7. In view of the above discussion, the Court is of the opinion that a decree for possession has to be drawn. The Court notes that the defendants had sought sufficient adjournments to indicate the terms by which the matter could be resolved or by which they could hand-over physical possession. In these circumstances, the Court is further of the opinion that the request made by the defendants to retain the premises for a period of 18 months from now is not reasonable. Therefore, a decree for possession is directed to be drawn. The defendants are granted three months' time to vacate the ground floor. In the event of their not handing-over possession of the ground floor of the premises to the plaintiff within the said period, the decree shall be executable immediately after that period. So far as the basement is concerned, the defendants are granted time to vacate the same on or before 28.02.2011 subject to their paying ` 30 per square feet with 15% percent additional charges with effect from 01.04.2009, (in line with the rent agreed to be paid by it in another premises, i.e. Sector -4, R.K. Puram). The amount constituting difference between what was paid to the plaintiff during the pendency of the proceeding for that period and what becomes payable according to this Court's order shall be paid - (to the plaintiff) within four weeks from today. It is directed that the defendants shall continue to make payments in respect of ground floor of the premises till they vacate the same.

8. The above order would not preclude the parties from urging whatever they have contended in the suit vis-a-vis claim for damages which survive consideration.

9. The suit is partly decreed in the above terms.

CS (OS) 785/2006 Page 3 CS (OS) 785/2006

List before the Joint Registrar on 18.10.2010, to enable parties to take steps to lead oral evidence on the issue concerning the quantum of damages that the plaintiff is entitled to after 28.03.2009 till the date handing-over physical possession of the premises towards use and occupation charges.

List before the Court 23.02.2011.

                                                           S. RAVINDRA BHAT
       AUGUST         19, 2010                                   (JUDGE)
       'ajk'




CS (OS) 785/2006
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