Karnataka High Court
The Branch Manager Kotak Mahindra Bank ... vs Sri A Srinivas S/O A Manohar Shetty on 5 December, 2023
Author: H.P.Sandesh
Bench: H.P.Sandesh
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NC: 2023:KHC-D:14198-DB
RFA No. 100475 of 2023
IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH
DATED THIS THE 5TH DAY OF DECEMBER, 2023
PRESENT
THE HON'BLE MR JUSTICE H.P.SANDESH
AND
THE HON'BLE MR JUSTICE RAMACHANDRA D. HUDDAR
REGULAR FIRST APPEAL NO. 100475 OF 2023 (MON-)
BETWEEN:
1. THE BRANCH MANAGER KOTAK MAHINDRA BANK LTD.,
APMC RAICHUR ROAD,
S THIMMAPPA SINGANAL COMPLEX,
GANGAVATHI, TQ. GANGAVATHI,
DIST. KOPPAL 583227 REP. BY AUTHORITY SEIND
2. SRI. RAJU UPPIN
AVP, AREA MANAGER,
KOTAK MAHINDRA BANK LTD.,
KOPPIKAR ROAD, P B NO. 70, HUBBALLI
3. SRI AMBAR DARBARI
VICE PRESIDENT,
YASHAVANT (FMG), INFINITY, 4TH FLOOR, BUILDING,
NARAYANKAR
NO.21, INFINITY PARK,
GENERAL A K VIDYA MARGA,
Digitally signed
by YASHAVANT MALAD (E) MUMBAI
NARAYANKAR
Date:
2023.12.08 ...APPELLANTS
10:05:07 +0530
(BY SRI. MRUTYUNJAY TATA BANGI, ADVOCATE)
AND:
1. SRI A SRINIVAS S/O A MANOHAR SHETTY
AGED ABOUT 51 YEARS,
OCC. BUSINESS, R/AT. VIJAYANAGAR,
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RFA No. 100475 of 2023
COLONY, GANGAVATHI,
TQ. GANGAVATHI, DIST. KOPPAL 583227
...RESPONDENT
(BY SRI. SANJAY CHANAL, ADVOCATE)
THIS RFA IS FILED UNDER SECTION 96 OF CPC., AGAINST
THE JUDGMENT AND DECREE DATED 20.06.2023 PASSED IN
O.S.NO.50/2019 ON THE FILE OF THE SENIOR CIVIL JUDGE AND
JUDICIAL MAGISTRATE FIRST CLASS, GANGAVATHI, PARTLY
DECREEING THE SUIT FILED FOR RECOVERY OF MONEY AND
/ARREARS OF RENT.
THIS APPEAL, COMING ON FOR ADMISSION, THIS DAY,
H.P. SANDESH, J., DELIVERED THE FOLLOWING:
JUDGMENT
This matter is listed for admission. Heard the learned
counsel for the appellants and the learned counsel for the
respondent.
2. Factual matrix of the case of the plaintiff before
the trial Court is that in O.S.No.50/2019 claim is made
that the plaintiff and defendant No.1 had mutually agreed
that the defendant would pay the rent of Rs.20 per month
per square feet from 05.07.2015 with respect to suit
schedule property. It is claimed that the defendant on
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15.12.2016 had issued termination notice to hand over
possession of the suit schedule premises by the plaintiff by
28.01.2017. It is also his contention that the plaintiff if
had knowledge regarding termination of the suit schedule
lease, he could not have cleared all the dues and
electricity bills up to 23.01.2017. The claim was made that
Rs.20,34,856-35 together with interest at 24% was due
from the defendants.
3. The Trial Court having considered the pleadings
of the parties has framed issues and has also directed the
parties to lead evidence to substantiate their contentions.
The plaintiff in order to prove his case, has examined one
witness as PW.1 and got marked documents from Ex.P.1
to Ex.P.56. On the other hand, defendant examined one
witness as DW.1 and got marked document as Ex.D.1.
4. The Trial Court having considered both oral and
documentary evidence available on record, comes to the
conclusion that there is no dispute with regard to the
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relationship between the parties. The Trial Court also took
note of documents at Ex.P.1 to Ex.P.56. Out of that Ex.P.1
is the registered lease agreement and in terms of the
lease agreement of the year 2011 the rent was fixed at
Rs.14,789/- per month and duration of the said agreement
was four years and six months which commenced from
06.01.2011. The said period was completed on
06.01.2015.
5. It is not in dispute that a notice was given to
the defendants by the plaintiff demanding to pay Rs.20/-
square feet rent to the plaintiff and also issued another
notice as per Ex.P.6 on 16.02.2016. The plaintiff also
relies upon the document of fresh letter of intention which
is marked as Ex.P.8. This document shows that fresh
agreement commences from 06.07.2015 and they intend
to Rs.41,460/- per month to the plaintiff shall be paid by
10th of every month in advance and further column No.10
shows that the agreement shall for period of 108 months
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i.e. nine years. Column No.11 shows rent escalation as
15% after completion of every three years.
6. Under these terms and conditions and other
conditions defendant No.3 official has sent this letter to
the plaintiff to agree for the terms and conditions to enter
the lease agreement in respect of the premises with their
bank. Defendant No.1 - Bank has contended that they
intended to pay the rent only to the carpet area i.e. 2764
square feet as against 3786 square feet.
7. The Trial Court having considered the same and
also even admission given by DW.1 in the cross-
examination, has taken note of the material on record and
fixed the rate of Rs.17-50 per square feet and determined
the rent and directed to pay amount of Rs.13,16,503/- as
arrears of rent and payable with 12% interest.
8. Being aggrieved by the judgment of the trial
Court, present appeal is filed before this Court.
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9. The main contention of the counsel for the
appellants is that the trial Court has committed an error in
fixing the rate at Rs.17-50 per square feet which is
without any proper consent between the parties and hence
the judgment and decree quantifying the rent is contrary
to the record. The counsel also would vehemently contend
that when there is no documentary proof for having
agreed to pay the rent and question of appellants to pay
the rent arrears does not arise and there must be
consensus ad idem.
10. The counsel for the appellants would
vehemently contend that bank has been run in terms of
the lease and the lease is to be produced before various
authorities so that registered postal address would made
note to the society, police and fire department and all. No
such agreement between the parties agreeing to pay that
much of rent and hence the Trial Court ought not to have
granted the relief in favour of the plaintiff. Hence, it
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requires admission and the matter requires for
reconsideration.
11. The counsel would also submit that interest
allowed at the rate of 12% per annum is on higher side
and ought to have considered at 6% per annum. The Trial
Court exercised its discretion erroneously like it is a
commercial transaction, as it is not a commercial
transaction.
12. Per contra, learned counsel appearing for the
respondent/plaintiff would vehemently contend that when
the lease period was expired and immediately an
intimation was also given to pay the rent at the rate of
Rs.20/- per square feet and when they did not come
forward when notice was issued terminating the tenancy
and to pay the rent as suggested, ultimately they vacated
the premises in the month of January - 2018 and also not
paid the arrears of rent regularly. The Court having taken
note of the said fact in the record, rightly come to the
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conclusion that the plaintiff liable to pay the interest at the
rate of 12% per annum. The Trial Court not committed
any error in granting the relief with interest at the rate of
12% per annum.
13. Having heard the appellants' counsel and also
the counsel appearing for the respondent, no dispute with
regard to the fact that there was already registered lease
agreement between the plaintiff and defendants in terms
of Ex.P.1. It is also important to note that Ex.P.2 is the
notice dated 17.03.2015 was caused to the bank. Ex.P.3
and P.4 are renewal of building lease letters. Ex.P.5 and
P.6 are the letter dated 01.10.2015 and copy of renewal of
lease agreement respectively, Ex.P.7 is the copy of legal
notice and Ex.P.8 is the letter dated 23.09.2016. The
notices were exchanged between the parties on different
occasions are at Ex.P.9 to 11. All these documents clearly
discloses that even after the expiry of the lease period also
both the parties have correspondent each other regarding
a demand made by the respondent and also giving
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consent by the appellants herein in terms of Ex.P.8. The
fact that lease was not renewed is not in dispute and also
the fact that termination notice was also issued in terms of
Ex.P.11, is also not in dispute.
14. It is also important to note that the respondent
herein, after the expiry of the lease period even offer to
continue the tenancy, at the rate of Rs.20/- per square
feet, but the fact is that when the lease was completed in
the year 2015 itself, appellants have not entered into any
fresh agreement except making some correspondence with
the respondent. The fact that letter was also issued by the
bank and also termination letter was issued, is also not in
dispute.
15. Though counsel appearing for appellants would
contend that they are not bound to make such payment
from 2015 itself, but they did not come forward to renew
the same and the said contention cannot be accepted.
The Trial Court taken note of the admission in paragraph
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No.17 of the judgment wherein, it is also categorically
stated that key was handed over in the month of January-
2018. When such being the case and the Trial Court also
while considering the demand made to the extent of
Rs.20/- per square feet, the same has not been accepted
but taken the own decision fixing the amount at Rs.17-50
per square feet. The fact that the respondent gave letter
intended to continue as tenant at the rate of Rs.20/- per
square feet, is not in dispute. When such demand is made
and even inspite of the expiry of the period of lease, the
appellants have continued the possession almost for a
period of three years and even the same was expired on
06.07.2015 and keys are handed over in the year 2018.
Prior to that, even termination notice as per Ex.P.11 dated
15.12.2016 was also issued, but they claims that premises
was vacant from 2017 and in this regard to substantiate
the same no material is placed before the Court. In fact
key of the said premises was handed over on 21.02.2018.
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16. When such material are found by the Trial
Court, we do not find any error committed by the Trial
Court fixing the rate of rent at Rs.17-50 per square feet
and directing them to pay an amount of Rs.13,16,503/-
and the same has been determined as arrears of rent
payable to the plaintiff with interest at the rate of 12% per
annum.
17. The counsel appearing for appellants would
vehemently contend that rate of interest that was fixed at
12% per annum is also on higher side and exorbitant and
under Section 34 of the Interest Act, 1978 ought to have
been made as 6%, the said submission also cannot be
accepted. The bank is running its business by collecting
the interest from customers and doing business in lending
loan. The very premises is used for commercial purpose
and the very contention of the counsel that transaction is
not commercial, cannot be accepted. Hence the very
contention of the appellant counsel that interest is also on
higher side, cannot be accepted. The counsel at this
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juncture also submits that from the date of suit Court has
to reduce the rate of interest, and the said submission also
cannot be accepted. The Trial Court determined the
arrears of rent payable by appellants in favour of the
defendants. The amount was due and the same was not
paid in time and being the bank ought to have continued
to pay atleast admitted rent and the same is not paid and
even arrears was also determined to the tune of
Rs.13,16,503/-. Hence the question of reducing the
interest from the date of suit also does not arise.
18. Having considered the material on records, we
have also given anxious consideration that if the lease
period expired, then the possession of the tenant become
illegal and also the respondent/plaintiff has not claimed
any damages and also not made any counter claim and
when such being the case, the question of considering the
damages does not arise and question of interference also
does not arise. No grounds to determine anything in the
matter and hence no grounds to admit the appeal.
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19. In view of the discussions made above, we pass
the following:
ORDER
Appeal is dismissed.
Sd/-
JUDGE
Sd/-
JUDGE
SH/SMM
