Mesne profits are payable from the date of lease termination, and the Appellate Court can extend payment periods and correct errors in lower court decisions.

JUDGMENT :

1. Petitioner-Bharat Petroleum Corporation Ltd. has filed this Revision Application challenging judgment and order dated 28 February 2024 passed by the Appellate Bench of the Small Causes Court in Misc. Appeal No. 47 of 2023. The Appellate Bench has not reduced the quantum of mesne profits determined by the Trial Court @ Rs. 2,41,691/- per month, but has reduced the rate of interest from 10% p.a. to 6% p.a. However, the Appellate Bench has modified the direction of the Small Causes Court which had restricted payment of mesne profits till passing order dated 15 October 2022 and has directed that the same be paid till delivery of possession of the suit premises. Applicant is thus aggrieved by non-reduction of quantum of mesne profits and in granting relief to Respondents by extending the period of payment from 15 October 2022 till date of delivery of possession though Respondents had not challenged the Trial Court’s Order.

2. Plaintiffs are lessees of land admeasuring 650 sq. yards equivalent to 543.48 sq.mtrs together with building, structures, driveway etc. constructed for operation of fuel station located at City Survey No.1900 (Part), Taluka-Byculla, District-Mumbai, which is located in Agripada Area on junction of Lamington Road and Dr. Anandrao Nair Road. Plaintiffs’ predecessor had executed Indenture of Lease dated 3 August 1960 in favour of Burma Shell Oil Storage and Distribution Company of India Limited (Burma Shell) for a period of 20 years commencing from 1 December 1957. The Government of India acquired the entire equity shareholding of Burma Shell on 24 January 1976 and the leasehold rights in respect of the land apparently vested in the Government of India. By Certificate of Incorporation issued on 12 February 1976, the name of the Company was changed to ‘Bharat Refineries Ltd.’ which was thereafter changed to ‘Bharat Petroleum Corporation Ltd.’ (BPCL).

3. Plaintiff issued notice dated 14 August 2004 to Defendant- BPCL terminating the tenancy and calling upon BPCL to deliver vacant and peaceful possession of the suit premises. Since the notice was not acted upon, Plaintiffs filed T.E. & R. Suit No.112/137 of 2005 in the Court of Small Causes at Mumbai for recovery of possession of the suit premises and for conduct of enquiry into mesne profits for use and occupation of the suit premises from the date of termination of tenancy till handing over possession of the suit premises. Plaintiffs also sought decree in the sum of Rs.90,00,000/- being compensation from 1 December 1997 to 30 March 2005 @ Rs.1,00,000/- per month for unlawful use and occupation of the suit premises by the Defendant. The suit was resisted by Defendant-BPCL by filing written statement. The learned Judge of the Small Causes Court proceeded to dismiss the Suit by decree dated 19 June 2009. Plaintiffs filed Appeal No. 404 of 2009 before the Appellate Bench of the Small Causes Court challenging the decree dated 19 June 2009. The Appellate Bench allowed the Appeal by its decree dated 12 October 2010 and set aside the decree dated 19 June 2009 passed by the Small Causes Court. The Appellate Bench decreed the suit with costs and directed the Defendant- BPCL to handover vacant and peaceful possession of the suit premises before 12 January 2011. The Appellate Bench also directed conduct of enquiry into mesne profits as per the provisions of Order 20 Rule 12 (1) (c) of the Code of Civil Procedure, 1908 (the Code).

4. Plaintiffs accordingly filed Mesne Profit Application No.182 of 2011 in the Court of Small Causes seeking determination of mesne profits in respect of the suit premises @ Rs.2,41,691/- per month from the date of termination of lease i.e. 14 August 2004 till handing over possession of the suit premises alongwith interest @ of 10.5% p.a. The application was resisted by Defendant-BPCL by filing reply. Both the parties led evidence. Plaintiffs examined Plaintiff No.1 as well as Mr. P. N. Powle, Government Approved Registered Valuer as their