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2026 Supreme(Mad) 2185

IN THE HIGH COURT OF JUDICATURE AT MADRAS
P. DHANABAL, J.
M/s YD Mart, Super Market – Appellant
Versus
C. Prabhu S/o Chidambaram Pillai – Respondent
CS No. 22 of 2022
Decided On : 04-02-2026

Advocates Appeared:
For the Appellant : S. Sathish Rajan
For the Respondent: T.N.C. Kaushik

A tenant must prove actual damages to recover claimed amounts from the landlord; failure to substantiate losses results in dismissal of claims, except for the advance refundable amount.

Headnote:(A) Tamil Nadu Town and Country Planning Act, 1971 - Sections 56 and 57 r/w Section 85 - Civil Procedure Code, 1908 - Order VII Rule 1 - Refund of advance amount claimed due to unauthorized construction and closure of business - Plaintiff entitled to refund of Rs.14,00,000/- with interest at 9% from date of vacation of premises; other claims involving costs of fittings, perishable goods, goodwill, and interest dismissed for lack of evidence. (Paras 8.1, 9.1, 9.3, 10).

(B) Tenancy and Lease - Rights and Obligations - Lease agreement does not consider pandemic circumstances; tenant must prove actual loss for damages and entitlement to claims. (Paras 8.2, 9.4, 10).

Facts of the case:
The plaintiff, a partnership firm, leased a property from the first defendant, paying an advance of Rs.14 Lakhs, but had to vacate due to unauthorized construction by the owner, leading to substantial losses. (Para 2.3-2.5)

Findings of Court:
The plaintiff is entitled to Rs.14 Lakhs refund with 9% interest, but other claimed amounts were denied for lack of proven damages and breach of contract. (Paras 11, 12)

Issues: 1. Entitlement to refund of advance amount? 2. Claim for installation costs? 3. Claim for loss of perishable goods? 4. Claim for goodwill loss? 5. Claim for interest on capital? 6. Liability of first defendant for closure? 7. Other reliefs? (Paras 4)

Ratio Decidendi: The court found that without evidence of actual damages or losses, claims for various expenses could not be accepted; the tenant's duty was to prove losses arising from the unauthorized actions of the landlord and authorities. (Paras 9.2, 9.3, 10)

Result: The suit is partly decreed in favor of the plaintiff.

Table of Content
1. factual basis of the suit. (Para 1 , 2)
2. plaintiff's claims regarding lease and damages. (Para 3 , 4)
3. defendant's denial of claims. (Para 5 , 6)
4. court's examination of refund claims. (Para 8 , 9)
5. court's final orders. (Para 10 , 11 , 12)

JUDGMENT :

P. DHANABAL, J.

1. This Civil Suit has been filed for refund of advance amount of Rs.14 Lakhs with future interest at the rate of 24% per annum; to pay a sum of Rs.21,22,821.00 towards cost incurred on the installation of fittings and fixtures and costs incurred on the establishment of interior works carried out by the plaintiff in the demised premises; to pay a sum of Rs.54,82,043.50/- towards loss incurred by the plaintiff on the abrupt removal of the perishable goods from the demised premises; to pay a sum of Rs.15,11,151.00/- towards loss of Good Will and to pay a sum of Rs.12,81,626.00/- towards loss of interest on the cost of capital and borrowed funds and for costs.

2. The brief averments of the plaint are as follows:-

2.1. The plaintiff is a partnership firm constituted under Indian Partnership Act and doing business of Supermarket, while the plaintiff was searching for a suitable place for running a super market in and around Velachery, the 1st defendant, who had constructed a new building in the radial road was willing to allow the same for commercial purpose. The building premises possessed a carpet area of 1,250 sq.ft., in the ground floor and 1500 sq.ft., in the first floor and with car parking and two wheeler parking area.

2.2. The 1st defendant agreed to let out the schedule mentioned property to the plaintiff firm for a period of 15 years for the monthly rent of Rs.1,00,000/-, on annual enhancement and also demanded a sum of Rs.14 Lakhs towards rental advance/security deposit. The plaintiff also agreed for the said sum and lease deed dated 28.06.2015 was entered into between the plaintiff and the 1st defendant. The plaintiff has paid a sum of Rs.14 Lakhs, as security deposit to the 1st defendant in terms of the above said lease deed. The lease period commenced on 01.08.2015 and it is valid up to 31.07.2030. The plaintiff has paid rents regularly without any default and they invested huge money for internal partition and over fixtures. The plaintiff-firm was carrying on business in the schedule mentioned premises and deployed their customer base and reputation and Good Will in a span of five years.

2.3. While so, all of a sudden, the officials from the 3rd defendant inspected the demised premises on 02.04.2019 and insisted the 1st defendant to produce the copy of the original approved plan in respect of the schedule mentioned property and thereafter, the 3rd defendant-officials issued notice dated 02.04.2019 under Sections 56 and 57 r/w Section 85 of Tamil Nadu Town and Country Planning Act, 1971. Based on the notice of the 3rd defendant, the 1st defendant submitted the approved plan to the 3rd defendant. Thereafter, the 3rd defendant issued show cause notice dated 24.05.2019, thereby calling upon the 1st defendant to restore the said building in accordance with the approved plan within 30 days with a threat of lock and seal of the unauthorised building and to demolish the same without any further notice.

2.4. The 1st defendant filed an appeal challenging the said show cause notice dated 24.05.2019 to the Secretary to Government and also filed the writ Petition in W.P.No.18727 of 2019 for Mandamus and this Court also directed the Secretary to Government to dispose of the said petition filed by the 1st defendant and the same was dismissed. Thereafter, the 3rd defendant officials issued notice dated 09.07.2019 to de-occupy the building, thereby the plaintiff and other partners of the plaintiff firm were kept in dark and were not aware of the above said proceedings initiated by the 3rd defendant till the issuance of lock and seal notice dated 24.02.2021. Pursuant to the notice dated 24.02.2021, when the plaintiff demanded the explanation from the 1st de

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