IMPORTANT POINT
The trial court's possession of pecuniary jurisdiction and the inability to adjust the security deposit against rent after the respondent vacated the premises were central to the court's decision.

JUDGMENT

[Physical Hearing/Hybrid Hearing (as per request)]

Rajiv Shakdher, J. (Oral)

CM Appl.11748-49/2024

1. Allowed, subject to just exceptions.

RFA(COMM) 70/2024 & CM Appls.11746-47/2024

2. This appeal is directed against the judgment and decree dated 13.10.2023 passed by the District Judge, Commercial-03, South-East, Saket Court, Delhi.

3. Respondent no.1/plaintiff had filed the suit for recovery of security deposit paid to the appellant/defendant no.1 concerning tenanted premises described as Unit No.DPT008, DLF Prime Towers, D Block, Okhla Industrial Area, Phase-1, New Delhi [hereafter referred to as the "suit property"].

4. The record shows that the disputants executed two lease deeds. The first lease deed was executed on 28.09.2017 [in short, "first lease deed"]. This lease deed, even according to the appellant/defendant, was unregistered, although it had a tenure of five (05) years.

5. Concededly, the disputants also entered into a second lease deed immediately thereafter, i.e., on 10.10.2017 [in short, "second lease deed"]. The second lease deed was executed for 11 months, commencing from 01.10.2017.

6. It is not disputed by the appellant/defendant that respondent no.1/plaintiff had made over a security deposit amounting to Rs.1,14,000/-.

6.1. It is this amount, along with interest at the rate of 18% per month, that the respondent no.1/plaintiff claimed in the suit action.

7. The trial court has returned the finding of fact that respondent no.1/plaintiff vacated the tenanted premises on 31.08.2019.

8. Counsel for the appellant/defendant has raised two contentions before us. First, the trial court did not possess pecuniary jurisdiction in the matter. Second, respondent no.1/plaintiff had indicated that it will continue in the suit property till October 2019 and therefore, the amount deposited towards security should be adjusted by way of rent for the period ending in October 2019.

8.1. In this context, our attention has been drawn on behalf of the appellant/defendant to the email dated 22.08.2019.

9. On the other hand, respondent no.1/plaintiff has raised the contention that the email dated 22.08.2019 does not carry weight, in view of the fact that respondent no.1/plaintiff, admittedly, vacated the suit property and handed over possession to the appellant/defendant on 31.08.2019.

10. The record shows that the appellant/defendant had filed an application under Order VII Rule 11 of the Code of Civil Procedure, 1908 [in short, "CPC"], for a summary dismissal of the suit action on the ground of absence of pecuniary jurisdiction. The trial court noticed that this attempt was repelled based on the rationale that the claim made by respondent no.1/plaintiff for the recovery of security deposit i.e., Rs.1,14,000/-, along with interest, which was quantified at Rs.3,07,800/-, was well above the pecuniary limit. The accumulated suit amount was Rs.4,21,800/-.

10.1. Concededly, the application filed by the appellant/defendant under Order VII Rule 11 of the CPC was dismissed on 14.02.2023.

11. Based on the aforesaid reasoning, the trial court rejected the plea taken by the appellant/defendant that it did not have pecuniary jurisdiction in the matter.

12. We tend to agree with the view taken by the trial court. The plea made by the appellant/defendant, that the trial court did not possess pecuniary jurisdiction is, in our opinion, untenable.

13. The second contention made by the appellant/defendant is equally without merit. Since the respondent no.1/plaintiff had vacated the suit premises on 31.08.2019, the security deposit could not have been adjusted against rent. There is no pleading, much less any evidence on record, which would show that the appellant/defendant was forced to keep the suit premises vacant between August and October 2019 in view of the email dated 22.08.2019.

13.1. In any event, the parties were clearly governed by the second lease deed, which stood determined on 31.08.2019. Clearly, thereafter, the respondent no.1/plaintiff was unde