S.l. Associates Private Limited v. Karnataka Handloom Dev

S.D. Pandit, J.

1. This is an application filed by the plaintiff M/s. S.L. Associate Pvt. Ltd. under Order 12, Rule 6, CPC.

2. Suit No. 3835/90 is filed by applicant plaintiff to get a decree of eviction and future mean profits. Plaintiff has come before the Court with a case that defendant-Karnataka Handloom Development Corporation Ltd. came in possession of their premises described in para 1 of the plaint as per the terms of the lease agreement dated 7.11.86. After taking the possession of the premises on 8.11.86 they failed to vacate the possession of the same after the efflux of time covered by the said agreement. As per the said agreement, they were to vacate the premises on 31.10.89. No doubt, the agreement deed contain a clause that by mutual agreement between both the parties the period of lease could be extended further for period of three years by giving rise in the rent by 10 per cent but the defendant had never moved for extending the said lease beyond three years and the managing director of the plaintiff-company had served a notice on them on 17.10.89 asking them to vacate the premises on 31.10.89. Thereafter two notices were served respectively on 11.1.90 and 10.11.90 calling upon the defendant to vacate the premises but as the defendant did not vacate the same, the suit was filed in the Court on 18.12.90.

3. Defendant has contested the claim of the plaintiff by filing written statement which is subsequently amended with the leave of the Court. In the said written statement, it has been alleged by the defendant that though the agreement of lease between the parties was mentioning that with the option of both the parties, the lease was to be extended only for three years, after the agreed period, there was an understanding between the parties that the defendant may continue as tenant for three more years after the period of lease. There was no question of any agreement or option to be mutually exercised by both the plaintiff and defendant to continue the lease beyond the period mentioned in the lease deed. It is further contended by the defendant that as it was initially agreed by the plaintiff for not giving effect to the terms of the agreement after the expiry of three years, the defendant had agreed to pay the hight rent of Rs. 15,000 per month when the similar premises in the neighbourhood were available for a monthly rent of Rs. 1,500 to Rs. 2,000. It is also further contended that because of the said understanding given by the plaintiff they had paid Rs. 1,80,000 by way of advance rent for one year and had also deposited a security of Rs. 6,50,000 with the plaintiff. They contended that the relationship between the plaintiff and defendant is that of landlord and tenant is governed by the provisions of Delhi Rent Control Act, 1958 and the provisions of Section 3(c) of Delhi Rent Control Act are ultra vires and that the same are not binding against the defendant. They thus contended that the plaintiffs suit is not tenable in law and the same deserves to be dismissed.

4. By this IA 10919/92, it is contended by the plaintiff that the defendant has admitted that the plaintiffs claim that the defendant came in possession of the property on account of the lease agreement dated 7.11.86. As per the terms of the said agreement the defendant was liable to vacate the premises after a period of three years on 31.10.89. The defendant was entitled to continue for further period of only three years only if there was mutual agreement between the plaintiff and defendant. And beyond that period they were not entitled to continue in possession of the same. It is contended by the plaintiff in this application that even as per the claim made may the defendant in the written statement, the defendant was to remain in possession of the property as per the agreement of lease for further period of three years. This period comes to an end on 31.10.92. That date is already over during the pendency of the suit. In view of the admissions of the defendant about the entry in possession of the property lease agreement dated 7.10.86 the Court should pass a decree of eviction under the provisions of Rule 6 of Order 12 of CPC.

5. The claim of the plaintiff is resisted by the defendant by filing its reply to this application. It is contended that the application in question is not maintainable as the same has not been signed on behalf of the plaintiff by duly authorised person as required by Order 29, Rule 21 CFC. It is further contended that the defendant has raised the objections regarding the jurisdiction of this Court to pass the decree in question and that is raising a serious question of law and in view of the same, the plaintiff is not entitled to get the relief under Rule 6 of Order 12, CPC. It is contended that there are no grounds for passing any judgment under Rule 6 of Order 12, CPC and therefore the present application should be rejected.

6. Before going to the merits of the case, it is necessary to consider the provisions of Rule 6 as per the amendment of the Code of Civil Procedure by amended Act of 1976. The said Rule 6 of Order 12 of CPC is running as under:

Judgment on admissions.

6. (1) Where admissions of fact have been made either in the pleading or otherwise, whether orally or in writing, the Court may at any stage of the suit, either on the application of any party or of its own motion and without waiting for the determination of any other question between the parties, make such order or give such judgment as it may think fit, having regard to such admissions.

(2) Whenever a judgment is pronounced under Sub-rule (1), a decree shall be drawn up in accordance with the judgment and the decree bear the date on which the judgment was pronounced.

If the above provisions of Rule 6 of Order 12 are considered then it would be quite clear that as per the amended provisions the Court can taken into consideration the provisions of the said Rule and even on its own motion pass a judgment if the same is covered by the provisions of the said Rule. Therefore, in these circumstances, in view of these specific provisions it is not necessary to go into the question as to whether this application under Order 12 Rule 6 is properly presented by plaintiff or not. The said application is signed by one Vijay Kumar Nagpal as well as Advocate of the plaintiff. Even accepting the contention raised on behalf of the defendant that the said Mr. Vijay Kumar Nagpal is not duly authorised person to file the said application. But consideration of the passing of a judgment under Order 12 Rule 6 could be done by this Court. The person who has signed this application has also signed an3 verified the plaint and copy of the necessary resolution which empowered him to sign and file the plaint has also been produced by the plaintiff on record. In view of the said resolution and the fact that this application is signed and verified by the same person who has signed the plant, the contention raised on behalf of the defendant that the application is not presented by duly and properly authorised person could not be accepted. But as stated earlier, even assuming for the sake of convenience that the contention of the defendant is to be accepted, I would not deprive this Court to exercise the jurisdiction to consider the question as to whether a judgment is to be passed in this case under the provisions of Rule 6 of Order 12 CPC. I, therefore, proceed to consider the question as to whether in the instant case a decree and judgment could be passed in favour of the plaintiff under the provisions of Rule 6 of Order 12, CPC.

7. In order to see whether in the circumstances of the case a judgment could be passed on the admissions of the defendant. It is necessary to consider the pleadings of the parties as well as the documents produced on record. Therefore it would be appropriate and proper to quote the pleadings of the parties in verbatim in order to see as to whether the defendant has given any admissions so as to pass a judgment on admission in this case. The relevant pleadings of the plaintiff and defendant for the consideration of the question before me are in paras 3 and 7 of the plaint and para No. A 1, Para No. 3 which is replied to para No. 3 of the plaint and para No. 6 of the written statement which is replied to para No. 7 of the plaint. Those pleadings are as under:

Para Nos. 3 & 7 of the Plaint:

3. The lease was for three years, commencing from 1.1.86, having a monthly rent of Rs, 15,000 per month @ Rs. 25per sq. ft., and was renewable at the option of both the parties for another period of three years only, in which event another deed of lease was to be executed by which the monthly rate of rent was to be increased by 10% of the first agreed rate of monthly rent.

7. The defendant-Corporationvide letter dated 17.10.89 refused to vacate the suit premises on expiry of the term of the lease.

Para Nos. A1, 3 and 6 of the written statement:

A1. The suit filed by the plaintiff is mala fide, mischievous and vexatious is nature. There is certainly no cause of action accruing in favour of the plaintiff for bringing the present suit. By a lease agreement dated 7.11.86 executed between the plaintiff and the defendant, the latter took on rent the suit premises at a monthly rent of Rs. 15,000 @ Rs. 25per sq. feet. Although Clause 3 of the said agreement dated 7th November, 1986 provided for an initial three years period, with the option of being renewed for a further period of three years at the option of both the parties, yet it was clearly understood inter se the parties that the lease would be renewed as a matter of course after the expiry of the initial period of three years. The said fact is borne out by the fact that the defendant agreed to an astronomical figure of Rs. 15,000 as monthly rent, when admittedly neighbouring shop owned by him identical in size were fetching very low rent i.e. Rs. 1500 to Rs. 2000 per month. It is because of the location of the suit premises from the business point of view, coupled with the implied arrangement of extension of the lease period, that the defendant agreed to such a high rate of rent. Another factor which is worth mentioning in this context is borne out from Clause 15 of the lease agreement which provided for deposit of a sum of Rs. 6,50,000 way of security deposit, without interest and an advance of Rs. 1,80,000 being advance rent for one year, the defendant would certainly not have agreed to such onerous terms and conditions but for security of tenure. It is rather unfortunate that the plaintiff having derived maximum advantage out of the onerous terms and conditions of the lease deed dated 7.11.86, is seeking ouster of the defendant by relying upon Clause 3, which they had agreed initially, for not giving effect to after the expiry of three years.This Honble Court may take this fact into consideration at the time of determining and adjudicating the present suit. This Honble Court may order accordingly.

3. With reference to the contents of paragraphs 3 of the plaint, the defendant states that by a lease agreement dated 7.11.86 executed between the plaintiff and the defendant the latter took on rent the suit premises at a monthly rent of Rs. 15,000 @ Rs. 25 per sq. feet. Although Clause 3 of the said agreement dated 7th November, 1986 provided for an initial three years period, with the option of being renewed at the option of both the parties, yet it was clearly understood inter se the parties that the lease would be renewed as a matter of cause after the expiry of the initial period of three years. The said fact is borne out by the fact that the defendant agreed to an astronomical figure of Rs. 15,000 as monthly rent, when admittedly neighbouring shop owned by him identical in size were fetching very low rent i.e. Rs. 1,500 to Rs. 2,0007- per month. It is because of the location of the suit premises from the business point of view, coupled with the implied arrangement of extension of the lease period, that the defendant agreed to such a high rate of rent. Another factor which is worth mentioning in this context is borne out from Clause 15 of the lease agreement by way of security deposit, without interest and an advance of Rs. 1,80,000 being advance rent for one year. The defendant would certainly not have agreed to such onerous terms and conditions but for security of tenure. It is rather unfortunate that the plaintiff having derived maximum advantage out of the onerous terms and conditions of the lease deed dated 7.11.86, is seeking ouster of the defendant by relying upon Clause 3, which they had agreed initially, for not giving effect to after the expiry of three years. This Honble Court may take this fact into consideration at the time of determining and adjudicating the present suit.

6. With reference to contents of paragraphs 6 and 7 of the plaint, it may be stated that the plaintiff having clearly agreed for extension of the lease after the expiry of the initial period of three years, was certainly not justified in issuing the said letter dated 7.10.89, the plaintiff was actuated by mala fide motive in issuing such letter and intern coax and coerce the defendant to vacate the suit premises. In view of the clear understanding for extension of the lease for further period of three years, the defendant rightly refused to vacate the suit premises and accordingly conveyed its stand to the plaintiff by its letter dated 17.10.89.

If the above pleadings of the parties are considered, then it would be quite clear that the plaintiff case that the contract of lease between the plaintiff and defendant took place as per the lease agreement on 7,11.86 is admitted by the defendant. The defendant has also admitted that the defendant entered to the possession of the property in question on the strength of the said lease deed. The defendant has also admitted that in the lease deed initial period was fixed for three years and at option of both the parties it was further extended for a period of three years. No doubt it is contended by the defendant that though the term of the lease deed mentions that the extension of the lease for further period of three years was at option of both the parties, understanding between the parties not to give effect to the said term of the agreement. It is also contended by the defendant that the said term of agreement was not to be given effect by the tenant as per the agreement between them and there was understanding between them to give extension for further period of three years after initial period of three years mentioned in the lease. No doubt, the said contention of the defendant is to be decided and considered if the said contention could be legally allowed to be raised by giving opportunity to the defendant to lead evidence in respect of the same. Therefore, in order to consider this question as to whether the defendant could legally raise the said contention and whether the defendant is to be given opportunity to lead evidence in respect of that contention.

8. But before considering and deciding these questions, I would like to quote here the provisions of Rule 16 of Order 6, CPC. The said provision is running as under:

Striking out pleadings,

16. The Court may at any stage of the proceedings order to be struck out or amended any matter in any pleading

(a) which may be unnecessary, scandalous, frivolous or vexatious, or

(b) which may tend to prejudice, embarrass or delay the fair trial of the suit, or

(c) which is otherwise an abuse of the process of the Court.

Now these provisions of Order 6 Rule 16 of the Code of Civil Procedure empowers a Court to struck off any part of the pleading at any stage of the proceeding which would amount to an abuse of process of the Code. The defendant in this case, has admitted the agreement of lease which took place between the parties on 7.11.86. The defendant has also admitted that the said lease deed was for a period of three years and the said lease deed however provide a clause that at option of both the parties the period of lease could be extended for a period of three years more. The defendant is now contending that these terms of the lease deed were agreed not to be implemented and given effect to by the plaintiff and the lease in favour of the defendant was to be continued. Defendant wants to lead evidence on these contention raised by the defendant. Now, what the defendant wants to contend is that the defendants wants to lead evidence to contradict the terms of the lease deed. He wants to contend that though the lease deed mentioned in the lease deed with the initial lease for a period of three years and at the option of both the parties it was to be extended for only three years more. Those terms of the lease are not correct and that there was agreement between the parties that the lease was to continue every after the period of lease was over. If the provisions of the Sections 91 and 92 of the Evidence Act are considered then it would be quite clear that when there is a written document between the parties, no party could be permitted to lead oral evidence to contradict or vary the terms of the contract. The contention that the defendant wants to raise and the evidence which the defendant wants to lead could not be permitted in view of the provisions of Sections 91 and 92 of Evidence Act. Therefore, that contention of the plaintiff would be a misuse of process of law. Because under the law if the defendant cannot be permitted and allowed to lead evidence to contradict the terms of the lease deed then to allow the defendant to have a plea which would give effect to lead evidence which is not permitted by Sections 91 and 92 would amount to misuse of process of law. Therefore, this part of the contention raised by the defendant could not be considered and the said part of the plea of the defendant will have to be ignored and struck of in view of the provisions of Order 6, Rule 16(c) of CPC. If the said contention of the defendant goes out of the consideration then in view of the terms of the lease deed between the parties the lease in favour of the defendant has come to an end by efflux of time as per the terms of the said document on 31.10.89. Apart from that notices are issued by the defendant terminating the lease land asking the defendant to give possession. Therefore, in this suit of eviction in view of the terms of the lease deed between the parties the plaintiff is entitled to get a decree of eviction in view of the admissions given by the defendant that the defendant has entered into the possession of the suit property on the strength of the lease deed on 7.11.86.

9. Even assuming in favour of the plaintiff that the lease was to be further extended for a period of three years without the consent of the plaintiff as per the terms of the said agreement. That period of three years has also now come to an end during the pendency of the suit. No doubt, a suit must be practical in all stages on the cause of action as it existed on its date of commencement. But the Court may however in suitable cases take notice of the events which have happened since the institution of the suit and afford relief to the parties on the basis of the altered conditions. This must be done by the Court by giving relief to the parties on the basis of altered circumstances in order to shorten litigation and get complete justice between the parties. As the defendant has entered into the possession on account of lease deed and such a period of lease deed is offered during the pendency of the suit by giving the interpretation of the terms of the agreement in favour of the defendant. The plaintiff is entitled to get a relief of eviction under the provisions of Rule 6, of Order 12 CPC. The facts of the case before me are exactly similar with the facts of the case before the Division Bench of the Madhya Pradesh High Court in the case of Sikar Chand and Others v. Mast Bari Bai and Others (AIR 1974 Madhya Pradesh 75) and in that case also a decree for eviction who passed in favour of the plaintiff under the provisions of Rule 6, Order 16 of CPC that would be quite clear from the following head note of the said case:

Where in a suit for eviction after the expiry of a lease on the defence being taken that under a compromise the term of the lease was extended by 10 years the plaintiff made an application (without admitting the agreement) that even if such an agreement took place they were entitled to a decree for possession under Order 12, Rule 6 since the extended term had also expired, it was open to the Court to base a judgment under Order 12, Rule 6 against the defendant on the basis of his own admissions because it is clear from the case as set up by him that he was not entitled to continue in possession of any case after the expiry of the fresh term of 10 years. The word otherwise in Order 12, Rule 6 dearly indicates that it is open to the Court to base the judgment on statements made by a party not only in the pleadings but also de hors the pleadings. Such admissions may be made either expressly or constructively.

It is no doubt true that ordinarily the plaintiff is entitled to a relief only on the basis of the cause of action stated in the plaint but it is open to the Court in suitable cases to afford a relief on the basis of the case as set up by the defendant. In such a case there is no prejudice to the defendant because the relief legitimately springs from the case as set up by him.

10. I have already pointed out that the contention of the defendant is to vary and contradict the terms of the lease deed. If the terms of the said lease deed were to be varied and changed then they could be changed by executing a new document or fresh lease deed. Even accepting the terms of the lease for the further renewal from 31.10.89 a fresh lease deed was necessary in favour of the defendant.

11. No doubt, one of the contention raised by the defendant is that the terms of the contract of lease between the parties are governed by the provisions of the Delhi Rent Control Act only rent Central Court has got jurisdiction to pass a jurisdiction of decree against them. But if the provisions of Section 3(c) of the Delhi Rent Control Act, 1958 as well as Delhi Rent Control Act, 1995 are seen then it would be quite clear that the lease in question does not fall within the purview of the said Act. The said Acts are having the similar wording of Section 3(c) which is as under:

3. Nothing in this Act shall apply

(c) to any premises, whether residential or not and whether let out before or after the commencement of this Act, whose monthly deemed rent on the date of commencement of this Act exceeds three thousand and five hundred rupees.

Admittedly the rent of the premises in question is of Rs. 15,000 per month. Therefore, as per the provisions of the said Act itself the provisions of the said Act are not applicable to the premises in question. The Delhi Rent Control Act is a special Act and the said Act has been enacted in order to give protection to some classes of tenancy. That classification of the tenancy could not be said to be discriminatory or ultra vires to the constitution. The said provision could not be said to be discretionary. Therefore, the contention of the defendant that the provision of Section 3(c) are ultra vires and her tenancy is governed of the provisions of the Delhi Rent Control Act is also a contention raised by way of misuse of process of law and therefore, the same must be ignored by striking off that plea under the provisions of Order 6, Rule 16(c).

12. Thus I hold that in view of the admissions given by the defendant of having come in the possession of the premises on the strength of document dated 7.11.86 and in view of the terms of the said document and admissions of the defendant, the plaintiff is entitled to get a decree for eviction. No doubt, the plaintiff has made claim for mesne profits but the mesne profits could be decided by a separate enquiry under the provisions of Rule 12, of Order 20 of the Code of Civil Procedure and for that purpose it is not necessary to keep the suit pending. Similarly; taking into consideration that the defendant is an undertaking of Government of Karnataka and it is a showroom of the undertaking of the Government of Karnataka, I would give three months period for the defendant to vacate the premises. I, therefore, pass the following order:

The defendant should vacate the suit premises and handover peaceful possession of suit premises to the plaintiff on 17.6.96.

An enquiry be held under Order 20, Rule 12 for determining the mesne profits from the date of the suit till the date of delivery of possession.

Defendant to pay costs of plaintiff and bears its own. A decree in above terms be drawn.

The suit and all pending IAs stand disposed of in view of the disposal of the suit.