S. Ravindra Bhat, J. FACTS

1. The present appeal arises against the decree passed by the learned Single Judge in CS(OS) 1661/2003 and CS(OS) 2108/2011 for the recovery of Rs. 45,23,414/-.

2. The appellant and respondent, both private limited companies registered under the Companies Act, 1956 entered into a license agreement dated 01.09.1995 in respect of premises bearing No 305A and 305B, Embassy Square, 148 Infantry Road, Bangalore (“suit premises”). The said premises were licensed by the respondent to the appellant company for 36 months, with a condition enabling renewal for 3 further years. The agreement was renewed till 31st August 2001. A security deposit of Rs. 27,45,000/-was paid through cheques to the respondent by the appellant. The agreement expired by efflux of time and the appellant shifted its office from the suit premises.

3. The appellant applied and secured permission from the Karnataka Electricity Board for additional load, for the said licensed premises; it made a refundable security deposit of Rs. 2,02,100/-(in terms of Clause 6 of the license agreement). It also installed standby generating sets and made a refundable security deposit of Rs. 6,25,000/- for maintenance etc. The appellant argued that the respondent opted to retain the additional electricity load and the generating systems installed, and had agreed to reimburse the security deposit paid in this regard by the appellant. On 04.09.2001, the appellant by a letter, called upon the respondent to renew the license agreement or to take back possession of the premises upon refunding the security deposit after adjustments. The respondent, however, did not agree to the terms of the agreement offered for renewal and made a counter offer for which no reply was received from the appellant till 28.09.2001. On 05.10. 2001, a meeting was held between the representatives of both parties, the minutes of which is in the record of this Court. The learned single Judge notes that the parties in the meeting had agreed to as follows: “1. NEPL acknowledge the receipt of security deposit of Rs. 27,45,000.

2. NEPL also has confirmed from Embassy Group, the deposit of Rs. 6,25,000/- for genset paid by SGI to Embassy Group on NEPL’s behalf. This amount needs to be refunded to SGI. Embassy Group and NEPL to decide amongst themselves as to who would refund this.

3. NEPL have claimed that rent for the month of September, 1995 (Rs.152,500.00 less TDS of Rs.35,075.00) has not been received by them. SGI to reconcile this account by Tuesday the October 9, 2001 and get back to NEPL.

4. NEPL has also claimed Rs. 1,37,250.00 being the balance due against arrears received in the month of May, 1998. SGI to reconcile this as well by Tuesday the October 9, 2001 and get back to NEPL.

5. NEPL has requested SGI not to surrender the additional electrical load obtained by SGI to KEB since NEPL wants to retain the same, NEPL to apply to KEB for transferring the same from SGI to NEPL. All charges pertaining to this would be borne by the NEPL.

6. The vacant possession has already been offered by SGI to NEPL at the end of the license period, against refund of Security Deposit.

7. SGI offers the following to NEPL against payment. Amounts to be mutually decided.

False Ceiling

Air condition ducting with pipes.

Fire Protection pipes

Electrical Control Panel.”

4. The appellant alleges that subsequent to this meeting too, the respondent did not take possession of the premises and subsequently sent a legal notice dated 27.12.2001 (to the appellant) claiming Rs. 25,29,582.50/- as rent/license fee for the months of September/ October 1995 and September – December, 2001. The appellant replied to the same through a legal notice dated 22.01.2002 where it reiterated its willingness to handover possession of the premises. In a subsequent legal notice dated 14.02.2002, the respondent informed the appellant of taking over possession of the premises by it, using the duplicate keys and the induction of M