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High Court of Delhi
THE HONOURABLE MR. JUSTICE PRADEEP NANDRAJOG & THE HONOURABLE MR. JUSTICE JAYANT NATH
Mohan Murti Shandilya
Versus
Pyare Lal Taheem & Another
RFA(OS) No. 15 of 2014
Decided On : 07-02-2014
lease agreement - breach of lease agreement - CS(OS)No.1348/2012 - Clause 10 of the lease-deed - simple interest @12% per annum - relevant facts - termination of lease - arrears of rent - mesne profits - interim order - security deposit - dishonoured cheques - punctual payment of rent
Fact of the Case:
The respondents sought ejectment, arrears of rent, and mesne profits from the appellant for breach of the lease agreement. The appellant claimed that the respondents terminated the lease prematurely and thus, he was entitled to rent for the unexpired period as per Clause 10 of the agreement.
Finding of the Court:
The court found that the appellant failed to make punctual payments of rent and outstanding charges, leading to the termination of the lease by the respondents. The court affirmed the decree in favor of the respondents for the unpaid rent, arrears, and mesne profits.
Issues: Breach of lease agreement, termination of lease, arrears of rent, mesne profits, dishonoured cheques, security deposit
Ratio Decidendi: The court held that the termination of the lease was not based on Clause 10 but on the failure of the appellant to make punctual payments, leading to the respondents' right to terminate the lease. The appellant was found liable to pay the unpaid rent, arrears, and outstanding charges to the respondents.
Final Decision: The impugned decree was affirmed, and the parties were ordered to bear their own costs in the appeal.
Pradeep Nandrajog, J.
1. Vide impugned decree dated July 30, 2013 noting that the defence of the appellant had been struck of, a decree in sum of Rs. 23,45,430/- has been passed in favour of the respondents and against the appellant with further direction that if decretal amount is not paid within eight weeks the same shall bear simple interest @12% per annum till date of payment.
2. To understand the contention advanced by the appellant as also to understand the decree we need to note the relevant facts.
3. Pyare Lal Taheem and his wife Indra Rani Taheem (the respondents) are owners of a 2½ storeyed building bearing Municipal No.C-106, NDSE Part-II, New Delhi. Vide registered lease-deed dated December 03, 2010, they let out to the appellant the ground and the first floor of their property for a period of three years commencing from December 01, 2010 at a monthly rent of Rs. 1,60,000/-. Water and electricity charges had to be borne by the appellant as per actual consumption. Clause No.1 of the lease-deed records that the payment schedule for the rent would be as under:-
Sr.
No. Cheque No. Date Bank Period Amount
1. 378002 26.11.2010 UCO Bank,
Patiala
House, New
Delhi 3 Months
Advance Rent &
3 months
Security. 9,60,000/-
2. 378003 26.11.2010 -do- 01.03.2011 80,000/-
3. 378005 01.03.2011 -do- 01.03.2011 80,000/-
4. 378007 01.04.2011 -do- 01.04.2011 80,000/-
5. 378008 01.04.2011 -do- 01.04.2011 80,000/-
6. 378009 01.05.2011 -do- 01.05.2011 80,000/-
7. 378010 01.05.2011 -do- 01.05.2011 80,000/-
8. 378011 01.06.2011 -do- 01.06.2011 80,000/-
9. 378012 01.06.2011 -do- 01.06.2011 80,000/-
10. 378013 01.07.2011 -do- 01.07.2011 80,000/-
11. 378014 01.07.2011 -do- 01.07.2011 80,000/-
12. 378015 01.08.2011 -do- 01.08.2011 80,000/-
13. 378016 01.08.2011 -do- 01.08.2011 80,000/-
14. 378017 01.09.2011 -do- 01.09.2011 80,000/-
15. 378018 01.09.2011 -do- 01.09.2011 80,000/-
16. 378019 01.10.2011 -do- 01.10.2011 80,000/-
17. 378020 01.10.2011 -do- 01.10.2011 80,000/-
18. 378021 01.11.2011 -do- 01.11.2011 80,000/-
19. 378022 01.11.2011 -do- 01.11.2011 80,000/-
20. 378023 01.12.2011 -do- 01.12.2011 to
30.11.2012 9,60,000/-
21. 378024 01.12.2011 -do- 01.12.2011 to
30.11.2012 9,60,000/-
22. 378025 01.12.2011 -do- 01.12.2011 to
30.11.2012 9,60,000/-
23. 378026 01.12.2011 -do- 01.12.2011 to
30.11.2012 9,60,000/-
4. As per Clause 14 of the lease-deed, the respondents received from the appellant refundable security deposit in sum of Rs. 4,80,000/-. Clause 10 of the lease-deed reads as under:-
“That in case Lessee desires to terminate the Lease Agreement, for any reason, whatsoever, earlier than the initial period of Three Years, the Lessee shall give two months notice in writing, in advance, of his intention to terminate the Lease Agreement. However, the Lessee shall not terminate the Lease Agreement in the first two years and six months of the Lease Agreement. I the even the Lessee terminates the present agreement before the completion of the First Two Years and Six Months, the Lessee shall be liable to pay the Lease Rent for the balance of the months remaining. The same shall apply to the Lessors also.”
5. A perusal of Clause 10 makes it apparent that the lease could be determined by the lessee by giving two months’ notice in writing but subject to the limitation that the lease would not be terminable in the first two years and six months of the commencement of the lease. In the event the lessee terminated the lease before completion of two years and six months, for the balance period the remaining lease rent had to be paid. The same was to apply to the lessors as well.
6. In other words as per Clause 10 in case appellant determined the lease prior to two years and six months he had to pay the rent for the unexpired portion of the period in question and vice versa.
7. CS(OS)No.1348/2012 was filed by the respondents seeking ejectment, arrears of rent and mesne profits alleging that the cheques No.378023 and 378024, listed at Sl.No.20 and 21 of the schedule as per Clause 1 of the leas
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