Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(Del) 484

IN THE HIGH COURT OF DELHI AT NEW DELHI
Neena Bansal Krishn, J.
M/S. Gallus Chattels Pvt. Ltd. - Appellant
Versus
Ishwar Industries Ltd. - Respondent
RFA 23 of 2021, CM APPL. 1808 of 2021, CM APPL. 1811 of 2021, CM APPL. 32472 of 2021 & CM APPL. 37915 of 2023
Decided On : 05-06-2026

Advocates Appeared:
For the Appellant :Mr. C. P. Vig, Advocate.
For the Respondent:Ms. Ekta Mehta, Mr. Antarik Chakrabarti, Ms. Zainab Khan, Advocates

A licensee inducted into property possession under an agreement is estopped from challenging the licensor's proprietary title. Upon termination of the license, the occupant is liable for mesne profits based on market rates from the date of revocation of the permissive use.

Headnote:(A) Code of Civil Procedure, 1908 - Order VI Rule 15, Order XLI Rule 1 - Section 96 - Property Law - Suit for possession and mesne profits - Licensee in possession - Estoppel from denying licensor's title - A party inducted into property possession through a license agreement is precluded from questioning the title of the party from whom possession was derived - Appellate court is not permitted to substitute its view for that of the trial court where findings are supported by evidence and are not perverse or suffering from illegality. (Paras 35, 57, 58, 86)

(B) Appeals - Scope - Proper valuation of suit for court fee and jurisdiction - Misjoinder and non-joinder of parties - Objections regarding technical defects in verification are not sufficient to defeat substantive rights of parties when the plaint is otherwise supported by evidence and affidavit. (Paras 56, 59, 61)

Facts of the case:
The respondent filed a suit for recovery of possession and mesne profits, asserting ownership of the subject property which was occupied by the appellants. The appellants claimed ownership based on development agreements. The trial court held that the appellants were inducted as licensees for a temporary period and decreed the suit in favor of the respondent. The appellants challenged this, citing lack of ownership, misjoinder of parties, and excessive calculation of mesne profits.

Findings of Court:
The court observed that the documentary evidence established the respondent's proprietary rights and the permissive nature of the appellants' possession. It held that the appellants, having obtained possession through the respondent, were estopped from challenging the respondent's title. The court upheld the judgment for possession but modified the commencement date for the calculation of mesne profits to align with the formal notice demanding possession.

Issues: The main issues were whether the appellants were licensees or owners, whether the respondent's title was proven for the purpose of the suit, and whether the quantum of mesne profits was legally justifiable.

Ratio Decidendi: A licensee cannot challenge the title of the licensor after taking possession with consent. Once the license is revoked and the occupant fails to vacate, the occupant is liable for mesne profits, which must be assessed based on prevailing market rates as supported by the evidence on record.

Result: Appeal partly allowed; impugned judgment for possession upheld, with modification on the commencement date for calculating mesne profits.

Table of Content
1. condonation of delay granted for appeal filing. (Para 1 , 2 , 3)
2. case facts and respective party pleadings summarized. (Para 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17 , 18 , 19 , 20 , 21 , 22 , 23 , 24)
3. issues framed and evidence record described. (Para 25 , 26 , 27 , 28 , 29 , 30 , 31)
4. trial court grants possession and mesne profits. (Para 32 , 33 , 34)
5. appellants challenge trial decree on factual grounds. (Para 35 , 36 , 37 , 38 , 39 , 40 , 41 , 42 , 43 , 44 , 45 , 46 , 47 , 48 , 49 , 50 , 51)
6. preliminary procedural and jurisdictional objections dismissed. (Para 52 , 53 , 54 , 55 , 56 , 57 , 58 , 59 , 60 , 61 , 62)
7. ownership and licensee relationship status judicially confirmed. (Para 63 , 64 , 65 , 66 , 67 , 68 , 69 , 70 , 71 , 72 , 73 , 74 , 75 , 76 , 77 , 78 , 79 , 80 , 81 , 82 , 83 , 84 , 85 , 86 , 87 , 88)
8. mesne profits calculation period modified for recovery. (Para 89 , 90 , 91 , 92 , 93 , 94)
9. judgment and decree upheld with partial modifications. (Para 95 , 96 , 97)

JUDGMENT :

NEENA BANSAL KRISHNA, J.

CM APPL. 1811/2021 (delay)

1. The present Application has been filed by the Appellant seeking condonation of delay of 262 days in re-filing the present Appeal.

2. For the reasons mentioned in the Application the same is allowed. The delay of 262 days in re-filing the present Appeal is condoned.

3. The present Application is disposed of in the aforesaid terms.

RFA 23/2021

4. Regular First Appeal under Section 96 read with Order XLI Rule 1 of the Code of Civil Procedure, 1908 (hereinafter referred to as ‘CPC’) has been filed by the Appellants/Defendants namely, M/s Gallus Chattels Pvt. Ltd., M/s Crocus Chattels Pvt. Ltd., M/s Colorado Chattels Pvt. Ltd. and M/s Nulon Chattels Pvt. Ltd. against the Judgment and Decree dated 19.02.2020, whereby, the Suit filed by the Plaintiff/Respondent, Ishwar Industries for possession and mesne profits, was decreed by the learned Additional District Judge.

5. The Plaintiff had filed a Civil Suit bearing CS No. 9831/2016 (old No. 1317/2005) for recovery of possession and mesne profits, against the Defendants.

6. The brief facts as narrated in the Plaint are, that the Plaintiff is a Company registered under the Companies Act, 1956. It was claimed to be the absolute owner of entire land and building, situated in Khasra Nos. 1723/1705, 1724/1705, 264, 262, 257/1, 258/1, 259 and 256, also known as Tribhuvan Complex, situated at Ishwar Nagar, 10th Mile Stone, Main Mathura Road, New Delhi.

7. The Plaintiff asserted that for the purpose of development and raising construction on the said land, the Plaintiff had entered into an Agreement dated 04.02.1986 with a builder M/s Growth Techno Projects Ltd. (‘GTPL’). It was claimed that the Agreement was amended vide supplementary Agreements dated 31.08.1990 and 18.06.1993.

8. For the aforesaid purpose of construction, the entire land was divided into 8 blocks and Defendants No. 1 to 4 were allotted block No. 5. However, till such time the construction was not completed in block No. 5, Defendants No. 1 to 3 were allowed temporary use of Block No. 4 admeasuring 2,500 sq. yards, (herein after referred to as the suit property) on license through a Letter dated 17.03.1994, for a limited period of 09 months, i.e., up to 16.12.1994. Defendant No. 4 was claimed to be a trespasser therein. It was also agreed that Defendants No. 1 to 3, who occupied space in Block No. 4, would not be required to pay any charges for the said period. However, the Defendants despite expiry of the license period, failed to vacate the property, even though various letters had been sent to them.

9. The Plaintiff asserted that Defendants No. 1 to 3 in breach of sanctioned plan and undertaking recorded in decree dated 19.07.1997 in Suit No. 73/1996 titled Ishwar Industries Limited v. Crocus Chattles Pvt. Ltd. & Others, got constructed basement and other unauthorized construction in Block No. 4 which belonged to them, whereafter, the Plaintiff wr

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2026 Supreme(Del) 484

IN THE HIGH COURT OF DELHI AT NEW DELHINeena Bansal Krishn, J.M/S. Gallus Chattels Pvt. Ltd. - AppellantVersusIshwar Industries Ltd. - RespondentRFA 23 of 2021, CM APPL. 1808 of 2021, CM APPL. 1811 of 2021, CM APPL. 32472 of 2021 & CM APPL. 37915 of 2023Decided On : 05-06-2026

A licensee inducted into property possession under an agreement is estopped from challenging the licensor's proprietary title. Upon termination of the license, the occupant is liable for mesne profits based on market rates from the date of revocation of the permissive use.

IN THE HIGH COURT OF DELHI AT NEW DELHI
Neena Bansal Krishn, J.
M/S. Gallus Chattels Pvt. Ltd. - Appellant
Versus
Ishwar Industries Ltd. - Respondent
RFA 23 of 2021, CM APPL. 1808 of 2021, CM APPL. 1811 of 2021, CM APPL. 32472 of 2021 & CM APPL. 37915 of 2023
Decided On : 05-06-2026