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DELHI HIGH COURT
Vipin Sanghi, J.
Sangeeta Batra —Appellant
versus
M/s. VND Foods & Ors. —Respondents
Crl. A. No.679 of 2015
Decided on 1.7.2015

IMPORTANT POINT
Tenant/lessee had no right to suspend payment of rent on destruction of premises, and upon refusal of respondent/landlord to either reconstruct himself or permit tenant to do so.

Headnote:Negotiable Instruments Act, 1881 — Section 138 — Dishonour of cheque — Acquittal — Advance cheques issued towards payment of rent by respondent/lessees — Respondents continued to remain tenants and incurred liability to pay rent month to month — Advance cheques issued towards payment of rent deposited for realization of rent for said period — Dishonoured upon presentation — Respondent/lessees incurred liability to pay rent as they continued to retain possession — Even though same sealed by municipal authorities — HELD — Reliance placed on Indus Airways (supra) by MM completely misplaced — For all the aforesaid reasons appeal allowed and impugned judgment set aside — Respondents convicted of offences under S. 138 of NI Act. [Paras 44 & 45]

       (ii) Negotiable Instruments Act, 1881 — Section 138 — Dishonour of cheque — Acquittal — Respondent/lessees took premises on lease with open eyes — If it to be accepted for sake of argument that premises taken by them on lease unmindful of excess coverage on basement and upper floors — And that said illegality latent, consequent sealing of leased premises would not entitle respondent/lessee to suspend their obligation to pay rent — Unilaterally when lease not avoided — Their only option was to surrender lease and claim damages for losses that they may have suffered on account of them being leased premises with such defects — HELD — This aspect completely overlooked by MM and fundamental error of law led to grave miscarriage of justice in present case. [Para — 33]

       Result: Appeal allowed

       

JUDGMENT

Vipin Sanghi, J.—The present appeal is directed against the common judgment dated 10.07.2014 passed by the learned Metropolitan Magistrate (NI Act)-041 Tis Hazari Courts, New Delhi in CC No. 76/10, whereby the complaint preferred by the appellant under Section 138 of the Negotiable Instruments Act (the NI Act), was rejected, and the respondents/accused were acquitted.

2. The case of the complainant/appellant is that the complainant, along with her four other sisters (who have also preferred identical complaints in respect of dishonoured cheques issued in their individual favour) are the owners of the premises – J-2/22, Rajouri Garden, New Delhi having 1/5th undivided share each. The aforesaid property is a freehold property consisting of basement, ground floor, first floor and second floor with roof rights. All the sisters/ complainants had appointed one Mr. Vipin Batra as their Attorney by way of a GPA dated 23.06.2008, and through him entered into five lease agreements on 18.07.2008-all marked as Ex.CW-1/DA, with the accused in respect of the undivided share of each of the sisters in the aforesaid premises for a period of nine years, at a total monthly rent of Rs. 5,50,000/- (before TDS deduction). The share of rent of each sister was Rs. 1,10,000/-. The respondents leased the property for the purpose of running a Restaurant under the name & style of “Kabab Factory”. The first three months, starting from the 1st July, 2008 to 30th September, 2008, was to be the rent free period for the purposes of carrying out the necessary works for the commencement of the restaurant business. The obligation for payment of the rent was to commence from 1st October, 2008 onwards. The period of nine years was divided, for the purposes of computation of monthly rent, into four slabs, as follows:

i) Monthly rent for the period 1st July, 2008 to 30th September, 2008 shall be Nil. (This period of 3 months will be treated as free for fit out to commence the restaurant)

ii) Monthly rent for the period 1st October, 2008 to 30th June, 2011 shall be Rs.1,10,000/-

iii) Monthly rent for the period 1st July 2011 to 30th June, 2014 shall be Rs.1,26,500/-

iv) Monthly rent for the period 1st July 2014 to 30th June, 2017 shall be Rs.1,45,475/-

The tenancy, however, got terminated in January, 2010.

3. At the time of the execution of the lease agreement, security deposit of an amount equivalent to three months rent was made by the accused. In addition to that, the accused/ lessee also issued 12 post dated cheques qua each lease agreement to each complainant/ lessors as advance rent, totaling 60 cheques for the period of 01.10.2008 to 30.09.2009. The said cheques were handed over to each of the complainants at the time of execution of each of the lease agreements i.e. on 18.07.2008 in pursuance of Clause (4) of the lease agreements-which are all having identical terms and conditions. Clause 4 of each of the lease agreements, insofar as it is relevant reads:

“the lessee has also submit 12 post dated cheques at the time of execution of this lease deed as advance for monthly rent….”

Each of the cheques were drawn for the amount of Rs. 91,300/- (After TDS deduction on rent of Rs. 1,10,000/-). Of these 60 cheques, 47 got dishonoured upon presentation, leading to filing of 47 separate complaints qua each dishonoured cheque. The details of the complaint, wherefrom the present appeal arises, are as follows:

CC No.

Complainant

Cheque dated

Cheque No.

76/01

Sangeeta Batra

06.04.2009

017198

4. However, the restaurant never commenced business as the necessary permissions for the installation of the lift and other alterations were not procured within time, though the accused remained in occupation of the aforesaid property. Subsequently, the aforesaid property was booked and sealed by the MCD for unauthorized construction/ excess coverage in v

















































































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