$~R-46

*

IN THE HIGH COURT OF DELHI AT NEW DELHI

% Date of Decision: March 15, 2012

+

FAO(OS) 227/2007

UOI

..... Appellant

Represented by: Ms.Geeta Sharma with

Ms.Priya Singh, Advocates.

versus

RAJENDER SINGH SAWHNEY ..... Respondent

Represented by: Mr.Akshay Makhija, Adv.

CORAM:

HON'BLE MR. JUSTICE PRADEEP NANDRAJOG

HON'BLE MS. JUSTICE PRATIBHA RANI

PRADEEP NANDRAJOG, J (Oral)

1.

Heard learned counsel for the parties.

2.

Jural

relationship

between

the

appellant

and

the

respondent commenced, when the respondent let out property

No.Z-9, Rajouri Garden, New Delhi, for purpose of setting up a

CGHS dispensary, to the appellant vide lease-deed dated

December 2, 1968 at a monthly rent of `1,250/-.

3.

Duration of the lease being 5 years, was extended from

time to time with mutual consent; increasing the monthly rent

as well, and in this manner the parties last agreed for lease to

be extended in the year 1994. The monthly lease rent agreed

to was `34,915/- and the lease period stood extended upto the

mid-night of August 27^th and 28^th, 1999.

2012:DHC:1801-DB

4.

As the lease expired by afflux of time on the mid-night of

the date afore-noted, parties could not agree to mutual terms

upon which the lease could be extended, resulting in the

respondent issuing a legal notice dated September 22, 1999

calling upon the appellant to not only vacate the tenanted

premises but additionally pay mesne profits @`30,000/- per

month, in addition to the agreed rent. The agreed rent being

`34,915/- per month, mesne profits claimed by the respondent

would obviously be `64,915/- per month.

5.

Since the appellant did not pay heed to the legal notice,

the respondent was constrained to file a civil suit seeking

ejectment of the appellant as also damages i.e. mesne profits

on account of unauthorised occupation of the leased premises

with effect from August 28, 1999.

6.

Since the suit was resisted on the strength of an

arbitration clause in the lease deed between the parties,

appellant and the respondent ultimately got the suit disposed

of, recording a statement made on behalf of the appellant that

it would vacate the tenanted premises, of which it was

continuing to occupy possession without legal authority, on the

mid-night by February 27 and 28, 2005. It was also agreed

between the parties that the issue of mesne profits be referred

to an Arbitrator.

7.

The appellant vacated the premises on February 27,

2005. Thus, what fell in the lap of the learned Arbitrator was

the mesne profits which the appellant had to pay to the

respondent for the period August 28, 1999 till February 27,

2012:DHC:1801-DB

2005. 8.

Before the learned sole Arbitrator, the respondent led

evidence that property bearing Municipal No.J-2/15A, B.K.Dutt

Market, Rajouri Garden, New Delhi had been let out at a

monthly rent of `2,17,025/- pursuant to a lease-deed dated

January 15, 2000.

9.

As against that, the appellant relied upon a rent

assessment figure determined by the Hiring Committee of

CPWD which submitted its report on February 10, 2004 opining

that upon the recognized principle of valuation of properties,

fair monthly rent effective from August 28, 1999 would be

`46,797/- per month and if fair rental was determined with

reference to the prevailing market rent, the same would be

`1,09,497/- per month.

10.

The learned Arbitrator negated the evidentiary worth of

the lease-deed pertaining to the property No.J-2/15A, B.K.Dutt

Market, Rajouri Garden, New Delhi; holding that the said

property was a commercial property in a market. The learned

Arbitrator held that the subject property was a residential

property. Accordingly, the learned Arbitrator determined the

mesne profits with reference to the assessment made by the

Hiring Committee of CPWD and in relation thereto, adopted the

rental determined on the