The main legal point established in the judgment is that the interpretation of the provisions of the Companies Act, 1956, governing the security deposit, refund, and interest, influenced the court's decision to grant conditional leave to defend the suit and the partial decree for the recovery of the security deposit.

JUDGMENT

N.J.JAMADAR, J.

1. This commercial division summary suit is instituted for recovery of a sum of Rs.3,66,58,175.00 , comprising of the security deposit of Rs.1,72,82,430.00 in respect of Leave and Licence Agreement dated 12th August, 2016 and a sum of Rs.1,77,97,164.00 in respect of Leave and Licence Agreement dated 27/02/2018, along with interest at the rate of 18% p.a. from 31/05/2020 till 31st August, 2020 and, future interest at the rate of 18% p.a. on the principal amount of the security deposit from 1st September, 2020 till realization.

2. In response to the writ of summons, the defendant has entered appearance.

3. Thereupon, the plaintiff has taken out this Summons for Judgment.

4. The material averments in the plaint can be summarized as under:

"(a) The plaintiff is a company incorporated under the provisions of Companies Act, 1956. It is a licensed financial services provider engaged in the business of providing corporate and investment banking solutions focused on the India Africa Corridor. The defendant is also incorporated under the provisions of the Companies Act, 1956. The defendant is the owner of the office premises on the first floor admeasuring approximately 17,160 sq. ft. carpet area and on the second floor admeasuring approximately 18,785 sq. ft. area, in Tower two of Raiaskaran Tech Park, Phase 2, Marol, Andheri East, Mumbai - 400 072 (the licensed premises).

(b) The defendant had given the aforesaid licensed premises on Leave and Licence basis to the plaintiff by executing two agreements. The first dated 12th August, 2016 (second floor agreement) and the second dated 27/02/2018 (first floor agreement). Under the terms of agreement dated 12th August, 2016, the plaintiff was to pay security deposit of Rs.1,72,82,430.00 to the defendant, which was to be refunded by the defendant to the plaintiff upon expiry of the tenure of the license simultaneously with handing over of the possession of the second floor in good condition (reasonable wear and tear excepted). In the event of default on the part of the defendant to refund the security deposit, the plaintiff was entitled to continue to occupy the second floor without payment of any license fee and also to claim interest on security deposit at the rate of 18% p.a. Clause 4 of the second agreement dated 27 th February, 2018 (first floor) contained identical stipulation.

(c) On 1st January, 2020, the plaintiff addressed two letters to the defendant expressing its intention to terminate the agreement with effect from 31st March, 2020. On 9 th March, 2020, the plaintiff addressed letters seeking short accommodation and postponement of the date of termination to 30th April, 2020 instead of 31st March, 2020. On 21st April, 2020, the plaintiff sought further extension and postponement of the date of termination to 31 st May, 2020. The defendant accepted those requests and the period of license stood extended upto 31/05/2020.

(d) On 27th April, 2020, the plaintiff addressed a letter to the defendant intimating the defendants of its readiness and willingness to hand over the first floor licensed premises on 30 th April, 2020. In response, on 30th April, 2020, the defendant contended that the defendant was not in a position to accept the early termination of the license as both the parties agreed that the period would stand extended upto 31/05/2020. Pursuant to the invoices raised by the plaintiff for the license fee, in the month of May, 2020, the plaintiff cleared the license fee upto May, 2020.

(e) By a communication dated 6th May, 2020, the plaintiff apprised the defendant that it had already vacated the premises on the first floor on 30 th April, 2020 and it was ready to hand over possession thereof and requested the defendant to complete the formalities and return the security deposit of Rs.1,77,99,164.00 . By another communication dated 22/05/2020, the plaintiff apprised the defendant its willingness to hand over the second floor to the defendant and demande