M/S. Dlf Limited vs M/S. Emirates
2010 Latest Caselaw 2359 Del

*          HIGH COURT OF DELHI : NEW DELHI


+          I.A. No. 1354/2009 in CS (OS) No. 2356/2007

M/S. DLF LIMITED                                               ...Plaintiff
                        Through    : Mr. Arvind K. Nigam, Sr. Adv. with
                                     Ms. Mandeep Kaur, Adv.

                                   Versus

M/S. EMIRATES                                                 ...Defendant
                        Through    : Mr. T.K. Ganju, Sr. Adv. with
                                     Ms. Bina Gupta and Mr. Ankur
                                     Saigal, Advs.

Reserved on: November 5th, 2009
Pronounced on: May 4th, 2010

Coram:

HON'BLE MR. JUSTICE MANMOHAN SINGH

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

2. To be referred to Reporter or not?                     Yes

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

MANMOHAN SINGH, J.

1. By this order, I shall dispose of I.A. No. 1354/2009 filed by

the plaintiff under Order XII Rule 6 and Order XV Rule 1 read with

Section 151 of the Code of Civil Procedure, 1908 („CPC‟ for brevity).

2. Brief facts for the purpose of deciding the present application

are that as per plaintiff, the plaintiff had leased out 714 sq. metres of its

property on the 7th floor, DLF Centre, Sansad Marg, New Delhi

(hereinafter referred to as the „suit property‟) to the defendant vide

registered lease deed dated 3rd February, 2003 for a period of 54 months,

expiring on 31st July, 2007. Despite efflux of time, the defendant failed

to vacate the suit premises. Hence the plaintiff filed the present suit for

ejectment of the defendant from the suit property and for recovery of

mesne profits/damages for use and occupation. The defendant has been

in unauthorized occupation of the suit property since 31st July, 2007.

3. It is the plaintiff‟s submission that the defendant did not opt

for renewal of the lease deed and is therefore not entitled to the same.

The plaintiff offered the prevalent rate of Rs. 400/- per sq. ft. per month

to the defendant, but the defendant instead filed CS (OS) No. 1321/2007

against the plaintiff for specific performance of the agreement in the

lease that provided for renewal of lease, hoping to take advantage of the

fact that similar premises would be available to it for less than Rs. 400/-

per sq. ft. per month.

4. The defendant‟s case, concisely stated is that, inter alia, the

lease in question is for a term of nine years. . The defendant asserts that

as per Clause 7(d) of the registered lease deed, it opted for renewal of the

said lease for the period from 1st August, 2007 to 31st January, 2012.

Both parties acted on the furtherance of the said renewal but the plaintiff

refused to formally execute the renewal due to mala fide reasons, which

resulted in the filing of CS (OS) No. 1321/2007 by the defendant for

specific performance of the said renewal which is pending before this

Court wherein the defendant has filed an application under Section 151

CPC being IA No.2967/2009 for consolidation of both the matters. The

defendant also asserts that the provision made in the lease agreement for

a notice in writing as stipulated in Clause 7 for renewal of the lease deed

is devoid of any meaning, the plaintiff having accepted advance amount

of security and bank guarantee from the defendant for the subsequent

period and various other acts/actions on part of the parties which clearly

show that the plaintiff is not entitled to raise any controversy about the

continuation of the lease for a second term of 54 months.

5. The following issues were framed :

"(i) Whether the defendant is entitled to continue in possession of the suit premises after expiry of the registered lease deed dated 3.2.2003?

(ii) In case Issue No. 1 is decided in favour of the plaintiff, whether the plaintiff is entitled to a decree of ejectment against the defendant?

(v) What is the effect of Clause 7(d) of the registered lease deed dated 3.2.2003?"

6. By the present application, the plaintiff has prayed that a

decree of ejectment be passed in its favour and against the defendant in

view of certain admissions made by the defendant on 13 th March, 2008.

It is the plaintiff‟s contention that a reading of Issue Nos. (i), (ii) and (v)

of the Issues framed by this court on 1st December, 2008 shows that the

registered lease deed of the suit property was admitted by the parties and

the relief of ejectment of the defendant ought to be granted after/on the

interpretation of the said document. The said issues are pertaining to the

relief of possession of the suit property and are based on the

interpretation of an admitted document. Further, once terms of a

document have been reduced into the form of a document like the

registered lease deed in the present case, no evidence is required to be

produced to prove the terms of such contract/grant except the said

document/lease deed itself as the same is based on interpretation of the

admitted lease deed.

7. The plaintiff‟s case is that the plaintiff granted a lease in

favour of the defendant for a first term of 54 months only as it is

registered for the period mentioned and the stamp duty is also for the

said period. The plaintiff has not denied the fact that the defendant had a

right to seek the second term of renewal for 54 months more but the said

renewal was subject to the defendant complying with the terms and

conditions stipulated in the lease and one of these was with regard to

giving a six months written notice prior to the expiry of the first term of

the lease duration of 54 months. As there was no compliance with the

terms of renewal, the necessary implication is that there was no renewal

of the lease deed.

8. The defendant has opposed the application on the same

grounds as stated in the written statement. It is also urged that the

renewal of lease deed was nothing but a formality and directory in nature

therefore non-compliance of the same within the time prescribed was not

fatal.

9. It is also urged that the real question is not as to whether the

registered lease deed has been admitted but as to the real meaning of the

terms and conditions of the lease deed, without the determining of which

by this court, no relief can be granted. As far as the registered lease deed

is concerned, the defendant has admitted the document but denied the

interpretation given to the same by the plaintiff. Further, as per the

plaintiff itself the relief of ejectment can only be granted after/on

interpretation of the lease deed, and admitting the same does not imply

that it has been interpreted as the court is yet to carry out the same.

10. Mr. Arvind K. Nigam, Senior Counsel appearing on behalf of

the plaintiff argued that no evidence is required to be adduced in the

present case as regards Issue Nos. (i) and (ii) and has drawn a parallel

between the present case and the case of R.N. Sachdeva & Ors. Vs.

Ramlal M. Trust, 1997 Rajdhani Law Reporter, 357. To further

elucidate the scope and meaning of Section 91 of the Evidence Act,

1872, learned senior counsel referred the case of Roop Kumar Vs.

Mohan Thedani, (2003) 6 SCC 595 wherein it was held as follows :

"13. Section 91 relates to evidence of terms of contract, grants and other disposition of properties reduced to form of document. This section merely forbids proving the contents of a writing otherwise than by writing itself; it is covered by the ordinary rule of law of evidence, applicable not merely to solemn writings of the sort named but to others known some times as the "best evidence rule". It is in really declaring a doctrine of the substantive law, namely, in the case of a written contract, that of all proceedings and contemporaneous oral expressions of the thing are merged in the writing or displaced by it. (See Thaver's Preliminary Law on Evidence p. 397 and p. 398; Phipson Evidence 7th Edn. p. 546; Wigmore's Evidence p. 2406.) It has been best described by Wigmore stating that the rule is no sense a rule of evidence but a rule of substantive law. It does not exclude certain data because they are for one or another reason untrustworthy or undesirable means of evidencing some fact to be proved. It does not concern a probative mental process - the process of believing one fact on the faith of another. What the rule does is to declare that certain kinds of facts are legally ineffective in the substantive law; and this of course (like any other ruling of substantive law) results in forbidding the fact to be proved at all. But this prohibition of providing it is merely the

dramatic aspect of the process of applying the rule of substantive law. When a thing is not to be proved at all the rule of prohibition does not become a rule of evidence merely because it comes into pay when the counsel offers to "prove" it or "give evidence" of it; otherwise any rule of law whatever might reduced to a rule of evidence. It would become the legitimate progeny of the law of evidence. For the purpose of specific varieties of jural effects - sale, contract etc. there are specific requirements varying according to the subject."

11. He argued that on a plain reading of the lease deed which was

registered and execution of which is also not disputed, it appears that the

lease deed was for a term of 54 months only subject to the condition of

renewal. As the defendant did not opt for the renewal in the prescribed

manner, the parties are not at issue on any question of law or fact.

Therefore, trial in the present case is not necessary and the application

filed by the plaintiff under Order XII Rule 6 CPC is liable to be allowed

and the Court is empowered to pronounce the judgment even in view of

the provision of Order XV of CPC. He referred two decisions which

have been passed in favour of the plaintiff under the same provision of

law; the first one is the case of G.M. Enterprises Pvt. Ltd. Vs. Sem Tian

Exports & Hotels Pvt. Ltd., 118 (2005) DLT 500 (paragraph 14) which

reads as under :

"14. In the absence of a contractual period of tenancy, the defendant could continue in possession of the premises but only as a month to month tenant which tenancy was terminable by the Lesser on service of a notice. That such a notice was sent to and received by the lessee is not disputed. Even the validity of the said notice is not in dispute before me. If that be so, there is nothing left to be tried, examined or determined in the suit in so far as the same prays for a decree for possession against the defendant. The provisions of Order XII Rule 6 of the CPC are, therefore, squarely applicable, entitling the plaintiff to a judgment in its favor to the extent the said judgment can be

sustained on admissions made by the defendant."

12. The second decision referred is Uptron Powertronics Ltd. Vs.

Sh. G.L. Rawal, 1999 IV AD (Del) 861 wherein a suit for possession,

mesne profits and damages was filed. Before the issues were framed, the

plaintiff in that case moved an application under Order XII Rule 6

praying that in view of admissions made by the defendant, no evidence

was required to be led and a decree may be passed for possession. The

learned Division Bench observed that the lease was for a period of three

years and renewal of the same was not registered. Hence, the lease

became a lease on month to month basis under the Transfer of Property

Act and was terminated in accordance with law under Section 106 of the

same Act.

13. It is argued that the defendant did not exercise the option of

renewing the lease deed within the stipulated time frame contained in

Clause 7(d) thereof. Stating that such non-renewal led to lapse of the

option of renewability of the lease deed, learned senior counsel referred

to Caltex (India) Ltd. Vs. Bhagwan Devi Marodia, AIR 1969 SC 405. In

paragraph 3 of that case, the Supreme Court observed that renewal of a

lease deed is a privilege and if the lessee wishes to benefit from that

privilege he must do so strictly within the time period provided for that

purpose. A lessee not having exercised the option of renewal within the

time limited/stipulated by the clause is not therefore entitled to a

renewal.

14. Mr. T.K. Ganju, learned Senior counsel appearing on behalf

of the defendant has argued that in the present case there is a dispute

with respect to the interpretation of certain clauses including the renewal

clause. The defendant in its suit for specific performance and injunction

has pleaded that the lease deed was drafted by the plaintiff therefore it is

not entitled to the relief sought in the application. In the suit filed by the

defendant, this Court on 01.12.2008 framed the following issues:

"(i) Whether the plaintiff is entitled to a decree for specific performance of agreement in terms of prayer (a) made in para 28 of the plaint?

(ii) Whether the plaintiff has always been ready and willing to perform its obligations under the agreement dated 3.2.2003?

(iii) Whether the plaintiff is entitled to a decree of prohibitory injunction as prayed for in prayer (b) of para 28 of the plaint?

(iv) Relief.

15. His next submission is that that a judgment is to be read in

the light of facts and circumstances of each case and the decision in

Caltex (India) Ltd. (supra) of the Apex Court is with respect to facts of

that case only. In the present case there is a suit instituted by the

defendant prior in time, further there is sufficient documentary evidence

on record to show the intention of the parties to grant a lease for full

period of nine years. He submits that the facts in Caltex (India) Ltd.

(supra) are that lessor vide lease dated 17.02.1954 leased a plot to the

lessee for 10 years. Clause 3 (c) provides for renewal of the said deed

and as per the said clause, the lessee was to make a written request two

calendar months before the expiry of the term. On 01.12.1963 the time

fixed for applying for the renewal lease expired and written request was

made by the lessee only on 13.12.1963. The facts in Caltex (India) are

totally different from the facts of the present case and hence have no

bearing.

16. He referred this Court‟s decision in Deepak Ansal Vs. Ansal

Properties and Industries Limited & Anr., 138 (2007) DLT 560 in

support of his submission wherein it has been held that:

"18. .......A decision is only an authority for which it actually decides. What is of the essence in a decision is its ratio and not every observation found therein nor what logically follows from the various observations made in it. The ratio of any decision must be understood in the background of the facts of that case. It has been said long time ago that a case is only an authority for what it actually decides and not what logically follows from it. It is well settled that a little difference in facts or additional facts may make a lot of difference in the precedential value of a decision.....

19. ......one additional or different fact may make a world of difference between conclusions in two cases. Disposal of cases by blindly placing reliance on a decision is not proper....."

17. He argued that the lease deed dated 03.02.2003 must be read

as a whole in order to come to any conclusion in the matter. The

conduct of the parties prior to the lease deed is necessary to be

examined. Before referring law on the issue, he submitted that there is

correspondence exchanged between the parties and particularly referred

to letter dated 20.12.2002 of the plaintiff and few clauses of lease deed

and annexures thereto wherein it is mentioned that the lease is for a

period of nine years with lock-in-period of five years. He referred the

case of Jamshed Vs. Burjorji, AIR 1915 PC 83 wherein the Court held

that the intention of the parties must appear from what has passed prior

to the contract between the parties. The other case on this point which

was referred by him was the case of Provash Chandra Dalui & Anr. Vs.

Biswanath Banerjee & Anr., 1989 Supp (1) SCC 487 where it was held

that :

"10. 'Ex praecedentibus et consequentibus optima fit interpretation The best interpretation is made from the context. Every contract is to be construed with reference to its object and the whole of its terms. The whole context must be considered to ascertain the intention of the parties. It is an accepted principle of construction that the sens; and meaning of the parties in any particular part of instrument may be collected 'ex antecedentibus et consequentibus; every part of it may be brought into action in order to collect from the whole one uniform and consistent sense, if that is possible. As Lord Davey said in N.E. Railway v. Hastings (1900) A.C. 260 , "The deed must be read as a whole in order to ascertain the true meaning of its several clauses, and the words of each clause should be so interpreted as to bring them into harmony with the other provisions of the deed if that interpretation does no violence to the meaning of which they are naturally susceptible." In construing a contract the Court must look at the words used in the contract unless they are such that one may suspect that they do not convey the intention correctly. If the words are clear, there is very little the Court can do about it. In the construction of a written instrument it is legitimate in order to ascertain the true meaning of the words used and if that be doubtful it is legitimate to have regard to the circumstances surrounding their creation and the subject matter to which it was designed and intended they should apply."

18. One more decision of the Supreme Court was referred being

the case of Swarnam Ramachandran & Anr. Vs. Aravacode

Chakungal Jayapalan, (2004) 8 SCC 689 (paragraph 11) which reads as

under :

"11. ......................the intention can be ascertained from:

(i) the express words used in the contract;

(ii) the nature of the property which forms the subject matter of the contract;

(iii) the nature of the contract itself; and

(iv) the surrounding circumstances.

12. That time is not to be of essence of the contract relating to immovable property, but it is of essence in contracts of

reconveyance or renewal of lease. The onus to plead and prove that time was the essence of the contract is on the person alleging it, thus giving an opportunity to the other side to adduce rebuttal evidence that time was not of essence............."

19. According to him, following are the surrounding

circumstances in the present case which would show that the

understanding between the parties was that the defendant would continue

in the premises till 2012 :-

(i) Plaintiff‟s letter dated 20.12.2002 specifically

mentions that the lease is for a period of nine years with lock-

in-period of five years;

(ii) Rent and other charges were to be revised w.e.f.

01.02.2006 for the next three years.

(iii) Bank Guarantee for INR 21,89,940,00 was valid

till 31.01.2008 and was furnished by the defendant vide letter

dated 01.03.2007.

(iv) In November 2006 the defendant desired to make

modifications within the premises including partitioning work,

storage, furniture work, painting, changing the flooring etc.

sent a letter dated 14.11.2006 to the plaintiff for the said

purpose and the same was approved by the plaintiff vide letter

dated 16.11.2006 and defendant spent cost by over Rs.50-

lakhs during this period. Defendant also installed new

telephone lines with the consent of the plaintiff.

20. He argued that whenever lease deed creates doubt about the

period of the lease or where there are two views possible, the court has

to examine the real intention of the parties at the time i.e. prior to the

date of execution of document and subsequent conduct of the parties.

The surrounding circumstances as referred by him speak for themselves

that the plaintiff is not entitled to the relief.

21. Reference has also been made by him in the case of DDA Vs.

Durga Chand Kaushish, AIR 1973 SC 2609 wherein it was observed

that :

"21. ... Now, it is a settled rule of interpretation that if there be admissible two constructions of a document, one of which will give effect to all the clauses therein while the other will render one or more of them nugatory, it is the former that should be adopted on the principle expressed in the maxim ut res magis valeat quam pereat.

24. We think that the proviso to covenant No. 9 could be said to suffer from the vice of an uncertainty which can only be removed by ignoring the words creating this uncertainty. We think that, in such a case, the ambiguous words can be disregarded so that the terms of the earlier operative part of the demise, which are clear, must prevail."

22. Lastly it is urged by him that the provision of Order XII Rule

6 CPC is a not a mandatory provision and even if the plaintiff has been

able to make out a strong case under this provision, the Court still has a

discretion to grant or decline the relief claimed. He has referred the case

of Manisha Commercial Ltd. Vs. N.R. Dongre & Anr., 85 (2000) DLT

211 wherein this Court, while interpreting Order XII Rule 6 CPC, held

that:

"6.................Order XII Rule 6 in fact prescribes this duty shall be a suo motu exercise. This rule however, predictably

invests discretion with the court - that is - even if there is an unequivocal admission by a party but the passing of a judgment would work injustice on it, judgment could be declined. ........... But it would be wholly inappropriate to permit any party to employ Order XII Rule 6 in those instances where vexed and complicated questions of issues of law have arisen.........."

23. Before dealing with the contentions of the parties, it is

necessary to refer Clause 7 (c) to (f) of the lease deed dated 03.02.2003,

the said clauses being reproduced hereinbelow :

"7(c) That the Lessee shall be entitled to terminate this lease before the expiry of its term by serving a prior written notice of six (6) months to DLF or giving six months rent, electro-mechanical equipment charges and other charges, levies etc. for the Demised Premises in lieu thereof to DLF.

7(d) That the lease hereby granted shall be for a period of 54 months commencing from 1st February, 2003 and shall expire by efflux of time on 31st July, 2007 and the Lessee shall have an option to renew the lease for further 54 months by giving 6 months written notice in advance prior to expiry of initial term of 54 months. Upon such renewal, the Lessee shall execute and register, at the cost of the Lessee, a fresh Lease Deed on the same terms and conditions as agreed to in this Deed. The escalation in the rent (inclusive of Electro-mechanical Charges), Interest Free Security, Interest Free Maintenance Security, are set out in Annexure-III which forms part and parcel of this Lease Deed.

The rent, electro-mechanical equipment charges and Interest Free Security shall automatically stand increased by 20% upon expiry of initial 36 months and the escalated rent, electro-mechanical equipment charges and Interest Free Security shall become payable from 37th months from the date of execution of this Deed and shall further increase by 20% upon expiry of 72 months and the escalated rent, electro-mechanical equipment charges and Interest Free Security shall become payable from 73 rd month of the lease/renewed lease from the date of the execution of this Lease Deed.

7(e) During the period of the renewed lease, the Lessee may terminate the lease by giving six (6) months‟ notice in writing to DLF or by payment of rent, electro-mechanical equipment charges and all other charges/sums/taxes

stipulated under this Deed in lieu of this notice. 7(f) That upon the expiry of 108th month from the Date of Possession or earlier termination by the Lessee during the renewed period as stipulated above, this Lease will expire and come to an end subject to the Lessee paying to DLF till the date of vacation, the entire rent, electro- mechanical equipment charges, maintenance charges, other charges, taxes etc. as set out in this Deed and handing over vacant, peaceful physical possession of the Demised premises."

24. The following are the relevant admitted facts between the

parties:

a) That the lease deed dated 03.02.2003 was admittedly registered

for a period of 54 months commencing from 1 st February, 2003 to

31st July, 2007.

b) The stamp duty and registration charges for the said period were

paid by the defendant.

c) As per Clause 7 (d) of the lease deed, an option was provided to

the defendant to renew the lease for further 54 months by giving six

months written notice in advance prior to the expiry of initial term

of 54 months.

d) Admittedly, the defendant has not exercised its option by giving

six months written notice in advance prior to the expiry of period.

e) The plaintiff issued the termination notice to the defendant for

unauthorized occupation of suit property since 31.07.2007.

f) The defendant has admitted the registered lease deed at the time

of admission/denial of the documents as Ex.P-1.

25. It has been held in a recent judgment by this Court reported in

National Insurance Co. Ltd. & Anr. Vs. Pahlad Tempo Service & Anr.,

158 (2009) DLT 59, that "the object of Order XII Rule 6 is to enable the

party to obtain a speedy judgment at least to the extent of the relief to

which there are admissions in the documents or in the pleadings. The

court cannot unduly narrow down the meaning of this Rule merely

because the Defendant gives a different interpretation to the documents

than that which the law permits. The court can hear the arguments on

the issue of interpretation of documents and give its finding on the

implications of such documents in view of the settled law."

26. It is laid down in the judgment of this court reported in 1997

Rajdhani Law Reporter at page 357 titled R.N. Sachdeva & Ors. Vs.

Ram Lal M. Trust that in the face of a document in writing, aforesaid

pleas cannot be permitted to be taken and are barred by the provision of

Section 92 of the Evidence Act. It has been held that the pleas of the

defendant "are not borne out from the written agreement executed

between the parties, no oral evidence can be lead in view of this written

agreement on record and as such no bona fide triable issues arises

which need investigation so far as the relief of possession is concerned

and the suit to that extent is entitled to be decreed."

27. The first plea raised by the defendant is that the lease

between the parties was for a period of nine years though the same was

registered for four and a half years. Clause 7 (d) which contains a

renewal clause was not to be applied as the same was incorporated at the

instance of the plaintiff for tax purposes. The condition of six months

prior notice to be given by the defendant for renewal of lease was just a

formality and is merely directory.

28. The plea of the defendant appears to be untenable in view of

Section 55 of the Contract Act. In Caltex (India) Ltd. (supra) it has

been held that "the lease fixes the time within which the application for

renewal is to be made. The time so fixed is of the essence of the bargain.

The tenant loses his rights unless he makes the communication in writing

within the stipulated time. Equity will not relieve the tenant from the

consequences of his own neglect which could well be avoided with

reasonable diligence."

29. In the case of DDA Vs. Durga Chand Kaushish (supra) it

has been held that "a renewal of a lease is really the grant of a fresh

lease. It is called a "renewal simply because it postulates the existence

of a prior lease which generally provides for renewals as of right. In all

other respects, it is really a fresh lease." The distinction between

renewal and extension of a lease was also made in terms of the

interpretation given by the Supreme Court. The present case is not a case

of extension, but that of renewal of lease.

30. The next plea of the defendant is that in Annexure-III to the

Lease Deed, the rates of rent and other charges are for the entire term of

nine years, i.e. up to 31.01.2012 and there is also a lock-in period of 60

months from the date of commencement of the lease, i.e. from

01.12.2003 to 31.01.2008, thus the question of lease term being only for

54 months does not arise.

31. It has been held in a recent decision of this Court reported as

Umesh Mediratta & Anr. Vs. State Bank of Indore in 153 (2008) DLT

787 in paragraph 8, that "Merely because the parties in one of the

clauses in the lease deed, provided as in Clause D.2, cannot make an

instrument which otherwise is in the concerned clauses thereof stated to

be for a term of three years and is valued for the purposes of stamp duty

as such, an instrument for a longer term requiring substantially more

stamp duty. Moreover, if the said contention is to be accepted, the same

would render otiose the clauses of the lease deed relating to renewal

thereof and of execution of a fresh lease deed at the time of each

renewal."

32. It appears from the circumstances explained that there is no

force in the submission of the defendant that merely because the

Annexure provides the rate of rent for nine years, the period of lease also

ought to be assumed to be for the same period despite the condition of

renewal subject to the condition of six months notice of renewal of lease

deed by the defendant and non-compliance of the same on the part of the

defendant. As the agreement between the parties is a registered

document, therefore, in view of settled law it is to be considered as the

repository of the terms and conditions settled between the parties at the

end of the day.

33. The next submission of the defendant is that there is

sufficient material on record to show surrounding circumstances which

amount to renewal of the lease deed by the conduct and intention of the

parties. Learned counsel has referred to the letter dated 20.12.2002

which has been written by the plaintiff to the defendant prior to the date

of execution of the lease deed confirming that the period of lease deed

would be nine years and the lock-in period of five years. Similarly,

learned counsel for the defendant has also referred letter dated

06.03.2006 written by the plaintiff to the defendant stating that the rental

and interest free refundable security deposit would be escalated w.e.f.

01.01.2006. The detail of the lease duration is also mentioned in the

letter as being from 01.02.2006 to 01.02.2009 and there is a demand

from the defendant to release the payment of Rs. 4,37,988/- and bank

guarantee of Rs. 13,13,965/- through cheque in favour of DLF Universal

Ltd. which was paid by the defendant.

34. The counsel has also referred to the letter dated 14.11.2006

written by the defendant to the plaintiff for renovation work inside the

ticketing area w.e.f. 15.11.2006 as well as the letter dated 16.11.2006

replied by the plaintiff allowing the defendant to modify the interiors of

the premises. Learned counsel has referred another letter dated

14.02.2007 written to the plaintiff to allow the agent to deliver the

consignment containing furniture and fixture in the defendant premises.

The letter dated 01.03.2007 has also been referred in order to show that

the bank guarantee no. 8964 for Rs. 21,89,940/- was renewed and valid

till 31.01.2008 and letter dated 09.03.2007 asking the plaintiff for

installation of a new telephone line at the premises.

35. It is pertinent to mention that all these circumstances referred

by the defendant happened prior to the period of expiry of registered

lease deed. I agree with the explanation given by the plaintiff that when

the renovation was allowed, the defendant at that time had the option to

renew the lease for second term and secondly the plaintiff could not

refuse the installation of telephone connection in March, 2007 as at that

time the occupancy of the defendant was as per valid period of lease.

There is no material on record to show that after the completion of

term of 54 months of the lease there was any consent or intention on

the part of the plaintiff which indicates that the plaintiff had

agreed to renew the lease deed for a second term of 54 months. Rather,

the plaintiff in advance wrote a letter dated 07.06.2007 informing the

defendant to hand over vacant possession of the premises to the

representatives of the plaintiff on 31.07.2007. The defendant first time

by e-mail dated 2.5.2007 expressed its desire to extend the lease deed for

another period of 54 months after the expiry of the first term of the lease

period. The request of the defendant for renewal of the lease was not

accepted by the plaintiff in its letter dated 4.5.2007 in view of Clause

7(d).

36. The other submission of the defendant is that the

defendant deposited additional security with the plaintiff in terms of

Annexure - III on 01.02.2006 and for this reason the applicability of the

renewal clause was waived in view of Clause 3 of the Lease Deed which

provides of interest-free Security Deposit equivalent to 12 months rent

only. A perusal of Annexure III shows that the same amount of security

deposit was payable by the defendant to the plaintiff in 2006 whether

there was renewal or not. Annexure III of the Lease Deed has to be read

constructively and harmoniously with the meaning of the entire lease

deed so as to not render parts of the same otiose.

37. The contention of the plaintiff in the rejoinder submission is

that the lease deed was drafted and finalised with mutual consent of the

parties. Time was also essence of the contract. The plaintiff has

admitted that there was an apparent typographical error in Annexure III

to the lease deed when it was mentioned that the lock-in period was 60

months. Otherwise, the first term of the lease period for 50 months to

60 months could not have been mentioned. The submission of the

plaintiff seems to be correct if all the clauses of the lease deed are read

together.

38. In the present case, admittedly the renewal of the lease deed

for a further term of 54 months was subject to the compliance of the

conditions prescribed under Clause 7 (d) of the lease deed. There was

non-compliance on the part of the defendant in availing of the option to

renew the lease. The renewal is no doubt subject to security and bank

guarantee being deposited, calculated at the enhanced rate before the

commencement of the second renewal term. But the second term of the

lease deed had not been renewed for a further period, therefore there is

no force in the contention of the defendant. In the absence of renewal,

the principal lease deed which is registered and admitted by the

defendant has to be considered and the same has to be read as a whole as

per settled law.

39. In State of U.P. & Ors. Vs. Lalji Tandon(Dead) Through

LRs, AIR 2004 SC 32 , the Apex Court made a distinction between an

extension of the lease deed in accordance with the covenants contained

in the principal lease and renewal of the lease as per the covenant for

renewal contained therein. The Apex Court held that in the case of an

extension, it is not necessary to have a fresh deed of lease executed. In

case where the lessee has the option of renewal, the same has to be

exercised consistently with the terms of the covenant. In Caltex (India)

Ltd. (supra) the notice of renewal given by the lessee was delayed by 12

days. The question before the Court was whether a renewal could be

deemed to have taken effect, the delay notwithstanding. The Apex Court

held that the tenant lost his right to seek a renewal as he did not make a

request of renewal within the stipulated time as per the contract. Thus,

there is no force in the argument of the defendant that the renewal of the

lease was just formal or a ministerial act and non-compliance would not

effect the right of the lessee to continue in occupation.

40. The case of Provash Chandra Dalui (supra) does not apply

to the present facts and circumstances of the case as the facts in that case

were different. In the judgment referred, the lease deed in question

repeatedly states that by payment of enhanced rent from such and such

period, the lease deed shall be extended for another five years. The lease

deed in the present case uses the word „renewal‟ and innumerable

precedents have expounded the essential distinction between „extension‟

of lease deed and „renewal‟ of lease deed and the consequences of one

cannot be applied to those of the other.

41. The judgment referred by the DDA Vs. Durga Chand

Kaushish (supra) does not come to the aid of the defendant as there is no

defective or contradictory language or clause in the lease deed under

consideration. There is no dispute between the parties that at the initial

stage it was agreed by the parties to execute the lease deed for the period

of nine years. Various steps were also taken by the parties in this regard.

However, it appears in the present case that the lease deed was

admittedly registered for a period of 54 months. The stamp duty was

also paid for the said period. By reading the lease deed as a whole, it is

clear that there were understandings between the parties that the lease

deed may be renewed for further period of 54 months subject to the

stipulated period of notice. Therefore, the annexures attached with the

lease deed indicate that in case the said stipulation/condition would have

been complied with by the defendant strictly, the lease deed could have

been renewed for further period of 54 months. Admittedly the

defendant in the present case did not issue the notice of renewal of the

lease deed prior to the six months of the lapse of the period. Therefore,

the ratio of Caltex (India) Ltd. (supra) is directly applicable to the facts

of the present case. Further, the decisions of this Court in Atma Ram

Properties (P) Ltd. Vs. Pal Properties (India) Pvt. Ltd. & Ors., 91

(2001) DLT 438 and in M/s. Sun Chandra & Compnay Vs. Punjab and

Sind Bank, 1996 V AD Delhi 323 deal with similar situations.

42. On a perusal of the terms of the lease deed coupled with the

fact that the lease deed is the registered document for the period of 54

months, the stamp duty was paid on the lease deed also for 54 months

and not for nine years, the validity of the registration of the document is

also admitted by the defendant, the argument of the defendant that the

same was for the nine years cannot be accepted and other pleas raised by

the defendant are untenable, thus, it is held that the lease deed was

actually executed and registered for a term of 54 months.

43. As far as the renewal of the lease is concerned, as per the

stipulated clause mentioned in the agreement, the defendant was

required to give a notice of six months prior to the date of expiry of the

first term of 54 months. The defendant did not opt its option to give the

six months‟ notice as per the stipulated clause of the lease deed. Thus, it

is held that in view thereof on the expiry of the first term of 54 months

i.e. by efflux of time it amounts to deeming surrender of tenancy.

44. In the absence of a contractual period of tenancy, the

defendant as per the law is to continue in possession of the premises but

only as month to month tenant. The tenancy is terminable by the lessor

on the service of notice. Admittedly, in the present case, notice was

served upon the defendant by the plaintiff, the receipt of which is not

disputed by the defendant. Thus, I am of the view that the trial in the

matter is not required as the parties are not at issue on any question of

law or act to be determined further. The provisions of Order XII Rule 6

CPC are therefore applicable. The Court is empowered to pronounce the

judgment under the said provision besides the provision of Order XV of

the CPC.

45. I, therefore, allow this application and decree the suit filed by

the plaintiff in relation to vacation of the defendant and delivery of

possession of the suit premises to the plaintiff. The defendant shall

vacate the premises within six months failing which the plaintiff would

be entitled take the necessary steps in accordance with law. As far as the

relief of mesne profits is concerned, the proceedings will continue for

the said purpose and a final decree be passed after the inquiry.

CS (OS) No. 2356/2007

List the matter before the Regular Bench on 1st July, 2010.

MANMOHAN SINGH, J.

MAY 04, 2010 sa