Krishna Rao, J.

1. The plaintiff has filed the present application being G.A. No. 3 of 2017 (Old G.A. No. 2004 of 2017) for acceptance of the report of the Special Referee and to pass final decree.

2. Initially the plaintiff had filed the suit against the defendant for recovery of vacant, peaceful and khas possession of the suit premises and for recovery of arrears of rent from 1st March, 2012 to 31st May, 2012 for Rs. 39,448/- and mesne profit from 31st May, 2012 till the delivery of vacant possession of the suit property.

3. The plaintiff had also filed an application under Chapter XIII-A of the Original Side Rules of this Court for summary judgment for eviction of the defendant for want of plausible defence. The application filed by the plaintiff for summary judgment was disposed of by this Court by an order dated 11th April, 2016 by granting decree in favour of the plaintiff for eviction of the defendant as well as for payment of arrears of rent of Rs. 39,448/- from 1st March, 2012 to 31st May, 2012 at the rate of Rs. 12,562/- per month. As regard to the mesne profits, a Special Referee was appointed for enquiry to determine the monthly market rent.

4. On 28th April, 2017, the Special Referee has submitted report by determining the monthly market rate of rent of the suit property from June, 2012 onwards upto March, 2017 within an interval of every two years at the end of the relevant financial year which is as follows :

“24. By reason of the aforesaid findings, I determine the monthly market rate of rent of the suit property from June, 2012 onwards up to March, 2017, with an interval of every two years at the end of the relevant financial year as follows : -

Monthly rate of rent from June, 2009 up to March, 2011 .. Rs. 62,252/-

Monthly rate of rent from April, 2011 up to March, 2013 .. Rs. 77,323/-

Monthly rate of rent from April, 2013 up to March, 2015 .. Rs. 92,493/-

Monthly rate of rent from April, 2015 up to March, 2017 .. Rs. 1,06,481/-.”

5. The plaintiff has accepted the report and praying for final decree in terms of the report submitted by the Special Referee. The defendant has not filed any exception to the report but has filed affidavit in opposition to the instant application. Subsequent of filing the affidavit-inopposition, the defendant has filed supplementary affidavit by incorporating certain facts which were not brought on record in the affidavit in opposition.

6. Mr. Joy Saha, Learned Senior Advocate, representing the defendant submitted that the original Lease Deed contained a Clause for renewal and the parties did renew the lease in accordance with such clause or whether the lessee would be entitled for successive renewal has not been considered by the Special Referee. He submits that the Lease Deed is not necessarily required to be executed a fresh in order to give effect to an extension of the original Lease Deed. He submits that the original Lease Deed continues in force during the extended lease term, since an extension of lease is only prolongation of the original Lease.

7. Mr. Saha submitted that the lessee’s conduct of retaining possession of the leased premises by paying the monthly rent in time even after expiry of original lease term would ordinarily indicate his desire to remain as a lessee. He submits that such holding over would be amount to a fresh tenancy even on the same terms and conditions of their earlier lease.

8. Mr. Saha submitted that the Special Referee while coming to his findings failed to interpret Section 116 of the Transfer of Property Act, 1882 with regard to its applicability and the effect of “Holding Over” and the assent of the landlord. He submits that in the Lease Agreement dated 15th September, 2004, renewal option was provided with an option to renew of the lease for a further period of five years on the same terms and conditions with 20% enhanced rent and the plaintiff has accepted the enhanced rent month by month for a period of three years without executing any instrument.

9. Mr. Saha submitted that the Special Referee ought to have considered the fact that the defendant continued in the premises with the consent of the plaintiff and the Lease period stood extended even after issuing the termination Notice dated 7th March, 2012 and the plaintiff did not chose to file suit till 20th January, 2015 which established that the Lease period extended till 31st March, 2014 and thus mesne profits required to be calculated from April, 2014 and not from any earlier date.

10. Mr. Saha submitted that the Special Referee has accepted the valuation report of the Valuer of the defendant but while arriving at the fair rental value, the Special Referee had not arrived at the fair rental value of Rs. 53,250/-. He submits that if the rental value of Rs. 53,250/- is taken into consideration, the mesne profit would be Rs. 18,90,375/- for the period from1st April, 2014 to 28th February, 2017 and if the fair rental value as per Valuer of the defendant is adopted from the date of decree, the mesne profit would be Rs. 5,32,500/- only.

11. Mr. Saha submitted that the Special Referee has not considered that the Valuer of the defendant in its report demonstrated that there is no change in the market value of the properties from the year 2009 to 2016, rather the market value of the properties come down to Rs. 6,760/- per sq.ft. in the year 2012 and Rs. 6,400/- in the year 2016. He submits that the Special Referee has accepted the report of the Valuer of the defendant but while calculating, the Special Referee has not considered the calculation made by the valuer of the defendant and thus the report is erroneous.

12. Mr. Saha submitted that the valuer of the defendant by producing the Deed No. 12907 of 2014 with respect to the property at B.B. Ganguly Street mentioned that the transaction price of Rs.7570/- per sq.ft and the rent comes about Rs. 42/- per sq.ft. and after adjustment of the attributes like no lift facilities, old type of the building, no car parking facilities assessment of fair rent was calculated at Rs. 35.70 per sq.ft.. He submits that the Special Referee while coming to finding mesne profits failed to appreciate the report of the Valuer of the defendant in which five comparable deeds were referred for the year 2009, 2012, 2014 and 2016 and it was opined that the market value of the property has not increased much.

13. Mr. Ranjan Bachawat, Learned Senior Advocate representing the plaintiff submits that the plaintiff has filed the suit on the basis of the notice of termination dated 21st April, 2012 and not on the basis of the expiry of lease. He submits that it is admitted that the tenancy was governed under the Transfer of property Act, 1882 and not under the Rent Regulation. He relied upon the judgment reported in (2005) 1 SCC 705 [LQ/SC/2004/1406] (Atma Ram Properties (P) Ltd. -vs- Federal Motors (P) Ltd.) and submitted that the Hon’ble Supreme Court held that:

“Under the general law, and in cases where the tenancy is governed only by the provisions of the Transfer of Property Act, 1882, once the tenancy comes to an end by determination of lease under Section 111 of the Transfer of Property Act, the right of the tenant to continue in possession of the premises comes to an end and for any period thereafter, for which he continues to occupy the premises, he becomes liable to pay damages for use and occupation at the rate which the landlord could have let out the premises on being vacated by the tenant.”

Mr. Bachawat submitted that in view of the settled position of law the plaintiff is entitled for mesne profits and on from 1st June, 2012 till 14th March, 2017 i.e. the date of delivery of possession of the suit premises.

14. Mr. Bachawat submitted that the Valuer of the defendant has taken rate of Rs. 7378 per sq.ft.as cost of the property in the year 2009 and Rs. 6758.75 or Rs. 6760 per sq.ft. in the year 2012. He submits that the Valuer of the defendant has ascertained the market value as on 2014 at Rs. 7500 x 1500 sq ft. = Rs.1,13,55,000/- and the annual fair rent is calculated at the rate 6.75% of Rs. 1,13,55,000/- = 7,66,462.50/- annual rent equivalent to Rs. 63,871.87 monthly rent, i.e. Rs. 42.58 or Rs. 42 per sq.ft. He submits that the Special Referee has applied the Cost Inflation Index and taken the figure of the year 2009 and used it for fixation of rent on the basis of the cost inflation index which was published.

15. Mr. Bachawat submitted that the valuer of the defendant has completely disregarded paragraphs 13 and 16 of the valuation report and had accepted at the rate of 35.50 after evaluating and analyzing the rent paid by the bank in not neighboring areas or areas spread over the entire Kolkata, without ascertaining the actual market rent in the locality of B.B. Ganguly Street. He submits that the Special Referee has taken the figure of the rent from the report of the Valuer of the defendant and has accepted the mode of valuation and the rates referred by the said valuer in his report. In paragraph 16 of the report, the valuer has applied the cost inflation index and calculated the market rent but ignored the same at the time of conclusion.

16. Mr. Bachawat submitted that the Special Referee has taken the rate of Rs. 7,378/- per sq.ft.as on 2009 as per the report of the valuer of the defendant which comes to Rs. 7378x1500 sq.ft. = 1,10,67,000/- as cost of the property and the rent would be 6.75% of Rs. 1,10,67,000/- comes to Rs. 7,47,023/- i.e. Rs. 62,252/- per month.

17. The defendant has raised two issues in the present application:

a. The date of payment of mesne profits should be from 1st April, 2014 instead of from June, 2012.

b. The market value to ascertain the mesne profit should be taken as Rs. 35.70 per sq.ft. instead of Rs.42 per sq.ft.

18. In the suit the plaintiff has prayed for the following reliefs:

“(a) Decree for eviction and for recovery of vacant, peaceful and khas possession of the said premises being the first floor of the premises being No. 127A, Bipin Behari Ganguly Street, Kolkata – 700 012, as more fully described in the Schedule B hereunder written against the defendant;

(b) Decree for Rs. 39,448/- as arrear of rent from 1st March, 2012 to 31st May, 2012;

(c) Decree for Rs. 48,20,000/- as mesne profit from 31st May, 2012 to 20th January, 2015;

(d) Decree for mesne profit at the rate of Rs. 5,000/- per day on and from 31st May, 2012 until delivery of vacant possession of the suit property to the plaintiff.

(e) Alternatively, an enquiry into mesne profit and a decree for such sum as may be found due and payable by the defendant to the plaintiff;

(f) Interim interest and interest upon judgment at the rate of 18% per annum.”

19. This Court while deciding the application filed by the plaintiff under Chapter XIII-A of the Original Side Rules of this Court has passed the following order:

“There shall be an order in terms of prayer (a) of the master’s summons. The plaintiff is also entitled to a decree for arrear rent as claimed in paragraph 17 of the plaint.

So far as the relief for mesne profits is concerned, this Court, instead of passing a decree for the same, hereby directs enquiry to be made as to the alleged mesne profits. This Court appoints Mr. Sabyasachi Chowdhury, a practicing advocate of this Court, as Special Referee who shall make an enquiry as to the mesne profits, after permitting the parties to adduce evidence in this regard. The Special Referee shall submit his findings on such enquiry within three months from the date of communication of this order to him. The remuneration of the Special Referee is fixed at 5000 GMs to be paid by the plaintiff at the first instance.”

20. The defendant has relied upon Clause VII of the Lease Deed dated 15th September, 2004 which reads as follows :

“VII. The Lessor doth hereby covenant with the Lessees that if the Lessees pay the rent hereby reserved regularly and if the Lessees have observed and performed all the covenants and conditions herein contained, the Lessor shall, on Lessees’ request extend the period of the lease on the same terms and conditions herein contained for a further period not exceeding five years with 20% enhancement in rent from the expiration of the term hereby granted.”

21. The defendant has raised the contention with regard to determination of the mesne profit from the month of April, 2014 instead of June, 2012 before the Special Referee and the Special Referee in his report has recorded the same as follows :

“6. Period of reference :

The Special Referee does not have any jurisdiction to go behind the decree or make any interpretation in respect thereof, with regard to the merits of the case. However, in view of the submission as above, I have decided to make the scope of enquiry for the larger period from June, 2012 up to March, 2017, for which mesne profit of the suit property would be determined. It would be open for the defendant to raise contention before the Hon’ble Court with regard to the commencement of the period from April, 2014 at the time when this report would be considered by the Hon’ble Court. Prima facie, I am satisfied upon perusal of the decree that since the same was passed upon termination of a lease from month to month by virtue of a notice under Section 106 in the year 2012, the scope of reference for determination of mesne profit should be from June, 2012 to March, 2017.”

22. The Special Referee has taken note of the contention raised by the defendant but has kept open for this Court to decide the same if the defendant raised the said issue but the Special Referee has taken into consideration of the period from June, 2012 to March, 2017.

23. The agreement contains the clause for extension for a further period not exceeding five years with 20% enhancement in the rent from the expiration of the original term. The original period of the Lease was from 1st April, 2004 to 31st March, 2009. The defendant continued with the possession of the suit premises till March, 2017. The defendant paid the enhance rent to the defendant till the month of February, 2012 and has further paid the arrears of rent from 1st March, 2012 to 31st May, 2012 as per the as per the summary judgment passed by this Court dated 11th April, 2016.

24. The plaintiff has issued notice under Section 106 of the Transfer of Property Act, 1882, on 21st April, 2012 but the suit was filed in the month of January, 2015 that is after the extended lease period. This Court while disposing of the application under Chapter XIII-A of the Original Side Rules of this Court held that:

“The present suit is filed not only on the basis of the notice terminating the tenancy under Section 106 of the Transfer of Property Act but also for recovery of possession on the strength of the expiration of the extended period.

…………………

…………………

…………………

“I am not oblivious of the proposition of law that if the respondent has shown a plausible defence which requires determination on evidence, no leave should be granted to the plaintiff to have summary judgement under Chapter XIII-A of the Original Side Rules of this Court. Letters exchanged between the parties after the expiration of the initial terms would reflect the minds of the parties. The aforesaid clause does not contain the word “renewal” but an option was given to the lessee to have the period provided under the lease to get it extended on same terms and conditions for a further period not exceeding 5 years, subject however, to enhancement of rent at the rate of 20% so reserved.

There is a clear distinction between the word “renewal” and “extension”. The former requires execution of a further document. However, in case of the latter, such continuance of possession is under the extended clause. The meaning which could be attributed to the word ‘renewal’ etymologically means ‘again’ and ‘fresh’ Section 107 of the Transfer of Property Act postulates that a lease for a period extending one year is required to be made by a written document and should be registered. In case of renewal, unless a fresh lease is executed, the continuance in possession cannot be presumed under a renewal clause. On the other hand, the word ‘extension’ logically means stretching of, flowing from and arising from earlier document and, therefore, does not require further or fresh document to be executed. The word ‘extension’ refers to existence of an earlier document and prolongation thereof, subject however, to the parties intending otherwise. It does not require a fresh or further document to be executed as the continuance in possession would be under the extension clause. The support can be lent on the aforesaid proposition to a judgment of the apex court in the case of Provash Chandra Dalui and another v. Biswanath Banerjee and another reported in AIR 1989 SC 1834 [LQ/SC/1989/211] , where it is held :

“It is pertinent to note that the word used is ‘extension’ and not ‘renewal’. To extend means to enlarge, expand, lengthen, prolong, to carry out further than its original limit. Extension, according to Black’s Law Dictionary means enlargement of the main body; addition of something smaller than that to which it is attached; to lengthen or prolong. Thus extension ordinarily implies the continued existence of something to be extended. The distinction between ‘extension’ and ‘renewal’ is chiefly that in the case of renewal, a new lease is required, while in the case of extension the same lease continues in force during additional period by the performance of the stipulated act. In other words, the word ‘extension’ when used in its proper and usual sense in connection with a lease means a prolongation of the lease. Construction of this stipulation in the lease in the above manner will also be consistent when the lease is taken as a whole. The purposes of the lease were not expected to last for only 10 years and as Mr. A. K. Sen rightly pointed out the Schedule specifically mentioned the lease as ‘for stipulated period of twenty years.’ As these words are very clear, there is very little for the Court to do about it.”

The letters exchanged between the parties do not indicate that there was a concluded contract for renewal as the petitioner ultimately showed its intention not to agree on the terms and conditions suggested by the respondent. Even if the statutory notice under Section 106 of the Transfer of Property Act was issued by the petitioner after the expiration of the initial term, it looses its efficacy the moment the extended term expires by efflux of time. Section 111(a) of the Transfer of Property Act does not contemplate any notice under Section 106 of the Act if the period provided under the lease runs its full tenure and the recovery is sought on such ground as well.”

25. Considered the finding of this Court in the order dated 11th April, 2016 passed in an application under Chapter XIII-A of the Original Side Rules and the Judgement of the Hon’ble Supreme Court in the case of Provash Chandra Dalui and Another –vs- Biswanath Banerjee and Another reported in AIR 1989 SC 1834 [LQ/SC/1989/211] wherein the Hon’ble Court held that “the distinction between ‘extension’ and ‘renewal’ is chiefly that in the case of renewal, a new lease is required, while in the case of extension the same lease continues in force during additional period by the performance of the stipulated act. In other words, the word ‘extension’ when used in its proper and usual sense in connection with a lease means a prolongation of the lease. Construction of this stipulation in the lease in the above manner will also be consistent when the lease is taken as a whole.” This Court finds that as per Clause VII of the Lease Deed dated 15th September, 2004, “the Lessor shall on Lessees request extend the period of the lease on the same terms and conditions herein contained for a further period not exceeding five years with 20% enhancement in rent from the expiration of the terms hereby granted”. After expiry of original term, the defendant continue with the possession and also started paying enhance rent from 1st April, 2009 and paid till February, 2012 and the plaintiff accepted the same. As per the order dated 11th April, 2016, the defendant paid the rent from 1st March, 2012 to 31st May, 2012 and thus the period from 1st April, 2009 to 30th March 2014, the possession of the defendant is to be treated as tenant. The defendant is liable to pay the mesne profit with respect of the Suit premises with effect from 1st April, 2014 till March, 2017 instead of from June, 2012.

26. As regard to the market value of the suit premises, to ascertain the mesne profits, the Special Referee has accepted the report of the Valuer of the defendant. The Special Referee in paragraph 14 of the report recorded that “By a comparative analysis of the evidence of two respective valuers, there is no doubt that the qualitative value of the evidence of the Valuer of the defendant bank was much better and based on actual figures obtained from sale values of properties for the year 2009 onward at B.B. Ganguly Street itself”.

27. The valuer of the defendant has recorded his findings in the following manner:

“11. I have come to the finding regarding fair Market rent of the subject Unit considering the asset by market approach and sales comparison Method as a guide line factor as follows :

i. Sale Reference in the Near Vicinity : (From A. R. A. Office Premises No. 124/1, B.B. Ganguli Street:- Case Refinance-1:- Deed No. 10482 for the year 2009 :- An area of 717.8 Sq. Ft. was sold at Rs. 52,95,928/- i.e. Rs. 7,337.99 per Sq. Ft. or say Rs. 7378/- per Sq. Ft.

ii. Case Reference-2: Deed No. 10483 for the year 2009 :- at Premises No. 130B/1B, B.B. Ganguly Street:- an area of 2009 Sq. Ft. was sold at Rs. 1,48,22,402/- i.e. Rs. 7378 per Sq. Ft.

iii. Case Reference -3: Deed No. 12460 for the year 2012: Premises No. 129/C, B. B. Ganguly Street: 840 Sq. Ft area sold at Rs. 56,77,350/- i.e. Rs. 6758.75 per Sq. Ft. or Rs. 6760/- per Sq. Ft.

iv. Case Reference-4:- Deed No. 03567 for the year 2016: Premises No. 92A, B.B. Ganguly Street:- area of 120 Sq. Ft. was sold at Rs. 7,68,000/- i.e. Rs. 6400/- per Sq. Ft.

I crave leave to produce all the documents as referred if I may be permitted to submit the same within a period of 2 weeks from the date of submission of any affidavit.

12. I say and submit that from the above facts it may construe that the rate for rent as well as Value of assets (Capital Value) has not been changed appreciable and can be termed as almost in the similar tune in the locality of the Captioned building during the period of 2009 to 2016 and the variation is about 15% in a span of about 7 years and not in the rising trend always.

13. However, considering this in mind if we ascertain the market Value of the subject Unit as on 2014 it comes about Rs. 7500/- x 1500 Sq. Ft. = Rs. 1,13,55,000/- and therefore, Annual Fair Rent is Calculated @ 6.75% of Rs. 1,13,55,000/- = Rs. 7,66,462.50p (considering standards set by different forums) and the Monthly rent comes to RS. 63,871.87 i.e. 42.58 per Sq. Ft or say Rs. 42.00 per Sq. Ft.”

28. The Valuer of the defendant has also taken the Cost Inflation Index to suggest rental valuation for the subsequent year 2015 onwards and suggested a monthly rental of Rs. 63,000/- for the year 2014. The Cost Inflation Index shown by the defendant’s Valuer is as follows :

“16. Now in case of mesne profit the CH may be referred as under : Considering Base year as March, 2014 (13-14) :

SL No.	Year	Costs Inflation Index	Fair Ren of Unit (Rs.)	Expected Rent incorporating CH (Rs.)	Rounded off (Rs.)
	2011-12		(1500xRs. 42)
1.	2012-13
2.	2013-14	939	63000.00		63000.00
3.	2014-15	1024		68702.87	68700
4.	2015-16	1081		72527.15	72525
5.	2016-17	1125		75479.22	74480

29. The Valuer of the defendant after ascertaining the market value of the subject premises as on 2014 came to the conclusion that the monthly rent comes to Rs. 63,871.87 i.e. 42.58 per Sq. Ft. for say Rs. 42.00 per Sq. Ft. The valuer of the defendant also considered the Cost Inflation Index as 939 for the year 2013-2014 and calculated the monthly rent as Rs. 63,000/-.

The Special Referee while considering the report of the valuer of the defendant determined the monthly rent as Rs. 62,252/- per month for the year 2009-2010 by taking into consideration the Cost Inflation Index as 632 and two Deed Nos. 10482 and 10483 which the Valuer of the defendant has relied upon at para 11(i) and (ii) of the report.

30. The Valuer of the defendant in paragraph 13 of the report came to the conclusion that the monthly rent would be Rs. 63,871.87/- per month i.e. Rs. 42/- per Sq.Ft. but while considering the Cost Inflation Index as Rs. 939 as on 2013-2014 came to the conclusion the fair market rent as Rs. 63,000/-.

The Special Referee has not considered two Deed Nos. 12460 for the year 2012 and Deed No. 03567 for the year 2016 which the Valuer of the defendant has considered in para 11 (iii) and (iv) of the report. The Valuer considering all four deeds as well as adjustment of attributes like no lift facilities, old type of building and car parking facilities come to the conclusion that the monthly rent as on 2014 would be Rs. 63,871/-.

31. The Special Referee by considering the report of the Valuer of the defendant has recorded that he has no hesitation in adapting the Valuer as suggested by the Valuer of the defendant in the year 2009 to be Rs. 7378/- but the Special Referee has not considered that the Valuer of the defendant has considered other documents and by analyzing all documents i.e. Deed Nos. 10482, 10483, 12460 and 03567 and variation about 15 % in a span of about seven (7) years came to the conclusion that the monthly rent would come Rs. 63,871/- i.e. Rs. 42 per Sq. Ft. for the year 2014 as on 2014.

32. The Valuer has considered the Cost Inflation Index for the year 2013- 2014 Rs. 939/- and the rent of the premises as Rs. 63,000/- but the Special Referee has considered the fair rent for the year 2013-2014 as Rs. 92,493/-, in my view, the Special Referee has not considered the all documents of the Valuer of the defendant which the Valuer has come to the conclusion to the fair rent for the year 2014 as Rs. 63,871/-. The Valuer of the defendant further come to the conclusion after taking into consideration with regard to the rent paid by the other branches of the defendant Bank and suggested the monthly rent of Rs. 53,250/- per month in the year 2014 but this Court finds that branches which the Valuer of the defendant has considered are not situated in and around the B.B. Ganguly Street and the Special Referee has rightly not considered the same.

33. Considering the above facts, this Court finds that the report of the Special Referee requires modification by taking into account, the date of mesne profits from the month of April’ 2014. This Court is also of the view that the monthly rent for the base year as March, 2014 (2013- 2014) should be taken as Rs. 63,000/- per month taking into account of Cost Inflation Index as 939. Though this Court held that mesne profits is to be considered from April, 2014 and thus this report of the Special Referee is modified as follows by considering Cost Inflation Index as 1024 for the year 2014-2015, 1081 for the year 2015-2016 and 1125 for 2016-2017.

a. Monthly enhance rent of 20% of the original rent with municipal tax from the month of June 2012 to March 2014.

b. The mesne profit of the suit premises shall be from 1st April, 2014 to March, 2017.

c. Monthly rent from April, 2014 to March, 2015 … Rs. 68,700/- per month.

d. Monthly rent from April, 2015 to March, 2016 … Rs. 72,525/- per month.

e. Monthly rent for April, 2016 to March, 2017 … Rs. 74,480/- per month.

f. The defendant shall also pay the interest at the rate of 8% per annum on the balance amount outstanding from the respective debts till the payment is made.

34. In view of the above, CS No. 20 of 2015 with GA No. 3 of 2017 (Old No. GA 2004 of 2017) are accordingly disposed of. Final Decree will be drawn accordingly.