1. Dispute over fixation of user and occupation charges for demised premises — Appeals against High Court orders — Settlement reached between landlord and tenant. (Para 2 , 3 )
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2025 Supreme(SC) 1535
SUPREME COURT OF INDIA
J.K. MAHESHWARI AND K.V. VISWANATHAN, JJ.
Rajiv Puri – Appellant
Versus
Amit Sharma And Others – Respondent
Civil Appeal No. 7270, 7271 of 2025 (Arising out of SLP (C) Nos. 24789-24790 of 2023)
Decided on : 09-05-2025
Important Points
The Court disposed of the appeals and related litigation based on a mutual settlement agreement between the landlord and tenant, wherein the tenant agreed to vacate the premises and the landlord waived all claims for arrears of rent, mesne profits, and user occupation charges.
Subject
Civil Law - Rent Control
Act Referred
Headnote
(A) Delhi Rent Control Act, 1958 - Section 3(c) - Dispute regarding user and occupation charges of premises - Parties entered into a settlement deed resolving all claims related to the tenancy and agreed upon rental terms - Tenant vacates premises; landlord waives claims for rent and other charges. (Paras 2, 3, 6, 9)
(B) Settlement of disputes - Parties capable of arriving at an amicable resolution without coercion - Such settlements are enforceable and prevent future litigation concerning the same matter. (Paras 4, 5, 8)
Facts of the case:
Appellant contested the High Court's order relating to charges for premises, which led to a settlement between landlord and tenant to vacate and resolve all claims amicably.
Findings of Court:
The appeals and original litigation to be disposed of in accordance with the settlement terms, incorporating all terms into the Court’s order.
Issues: Whether the parties could sufficiently settle their disputes and the enforceability of such settlement under the Delhi Rent Control Act.
Ratio Decidendi: The court recognizes the validity of private settlements between parties for tenancy disputes when made voluntarily and without coercion, emphasizing that such agreements are integral to dispute resolution.
Result: Appeals disposed of in terms of the settlement.
(B) Settlement of disputes - Parties capable of arriving at an amicable resolution without coercion - Such settlements are enforceable and prevent future litigation concerning the same matter. (Paras 4, 5, 8)
Facts of the case:
Appellant contested the High Court's order relating to charges for premises, which led to a settlement between landlord and tenant to vacate and resolve all claims amicably.
Findings of Court:
The appeals and original litigation to be disposed of in accordance with the settlement terms, incorporating all terms into the Court’s order.
Issues: Whether the parties could sufficiently settle their disputes and the enforceability of such settlement under the Delhi Rent Control Act.
Ratio Decidendi: The court recognizes the validity of private settlements between parties for tenancy disputes when made voluntarily and without coercion, emphasizing that such agreements are integral to dispute resolution.
Result: Appeals disposed of in terms of the settlement.
Legal Category Hierarchy
Table of Contents
2. Landlord sought fixation of user and occupation charges — Tenant sought modification of the fixation order. (Para 2 )
3. Parties entered into an amicable settlement to resolve the dispute in its entirety, involving the handover of possession and waiver of arrears. (Para 3 , 4 , 5 )
4. Litigation between landlord and tenant may be disposed of in terms of a voluntary settlement deed resolving possession and financial claims. (Para 6 )
5. Appeals and original litigation disposed of in terms of the settlement deed; premises vacated and arrears waived. (Para 6 , 7 , 8 , 9 )
6. Can a court dispose of landlord-tenant litigation based on a settlement agreement?
Yes, if parties voluntarily enter into an amicable settlement to resolve the dispute in its entirety, including possession and financial claims, the court may dispose of the litigation in terms of the settlement. (Para 3 , 6 )
7. Under what condition are premises excluded from the Delhi Rent Control Act, 1958?
Premises can be excluded from the purview of the Delhi Rent Control Act, 1958, in terms of Section 3(c) of the Act, such as when the rent is revised to a specific amount. (Para 3 )
ORDER :
1. Leave granted.
2. Challenging the order dated 11.10.2023 passed by the High Court of Delhi in CM Appl. No. 46165 of 2022 in R.C.(Rev.) No.123 of 2022 filed by the respondents (landlord) seeking fixation of user and occupation charges of the demised premises bearing No. G-18-A, South Extension Market, Part-I, New Delhi, and order dated 20.10.2023 dismissing CM Appl. No. 55351 of 2023 in R.C.(Rev.) No.123 of 2022 filed by the appellant (tenant) for modification of order dated 11.10.2023, the present appeals have been preferred.
3. During the pendency, several directions were issued with respect to the deposit of interim occupational charges as fixed by this Court. Later, on good sense having prevailed, the parties have entered into an amicable settlement on 23.04.2025 by way of a settlement deed to resolve the dispute in its entirety. As per the settlement deed, appellant has agreed to vacate the demised premises and handover the peaceful possession to respondents and withdraw/ request to dispose of any pending litigation. Likewise, respondents have agreed to not claim any arrears of rent, mesne profits and user charges from appellant. A relevant portion of the settlement deed dated 23.04.2025 has been reproduced for convenience :-
"1. That in pursuant to the order dated 28.02.2025 passed by the Hon'ble Supreme Court in SLP(Civil) No. 24789/2023 the rent was fixed Rupees. 2,50,000/- per month w.e.f 1.1.2025. Thereafter the actual rent in respect of the said shop was mutually revised to Rs. 1,00,000/-with effect from 01.03.2025 and the First Party acknowledges that said amount has been deposited directly with the registry of the Hon'ble Supreme Court which is treated as payment of revised rent for the month of March, 2025 from the Second Party. That by virtue of this revised rent, the parties acknowledges that the said shop stands excluded from the purview of Delhi Rent Control Act, 1958 in terms section 3(c) thereof.
2. That, now the Second Party as a tenant at a monthly rent of Rs. 1,00,000/- per month has voluntarily agreed to vacate the Said Shop i.e Shop on Ground Floor of property bearing no. G -18-A, South Extension Part-I, New Delhi as shown in red colour in the site plan filed by the First Party in the eviction petition bearing no.6255/2016 and shall hand over vacant, peaceful, and physical possession of the same to the First Party, along with the keys at the time of recording the statement before the Hon'ble Supreme court.
3. That in view of the settlement, it has been mutually agreed between the First Party and Second Party, that in furtherance of the possession of the said Shop being handed over by the Second Party to the First Party, the First Party shall not claim any arrears of rent/user occupation charges etc. whatsoever, including past, present, or future, with respect to the Said Shop from the Second Party subject to handover of the possession of the said Shop.
4. That the First Party, as a gesture of goodwill and without prejudice, agrees not to claim any arrears of rent, mesne profits, or user occupation charges against the Second Party in any court, including the Hon'ble High Court and Hon'ble Supreme Court, except for what has already been deposited by the Second Party before the respective forums and further endorses that the second party has no objection if the amount already deposited with the Hon'ble Supreme Court is released in favour of First Party.
5. That the Second Party undertakes to file appropriate applications for withdrawal of R.C. Rev. No. 123/2022 before the Hon'ble High Court of Delhi and in SLP(C) Nos. 24789-24790/2023 before the Hon'ble Supreme Court of India or request the Hon'ble Supreme Court to exercise its power under Article 142 of Constitution of India to dispose of the RCR No. 123/2022 before itself only, and further confirms that the present settlement has been arrived at voluntarily and undertaking to be bound by the present MOS and undertaking to abide by MOS in letter and sp
