Bhartia Industries Ltd Bch Electric Ltd & Anr v. Rajiv Saluja

G.SSSTAM, J. ORAJ None had appeared on behalf of the respondent on the last date of hearing. None is present on behalf of the respondent even today. Present appeal is directed against the judgment and decree dated

25.2.2010 passed by learned Additional District fudge in Suit No.163/05, by which, the trial court has awarded damages/mesne profits for use and occupation of the property bearing no.119/89 (New No.39A), Sainik Farms, New Delhi-63, @ 85,000/, per month, for the period commencing from 1.8.2003 to 31.3.2004 with interest © 12%, per annum, compounded annually from the date of accrual of damages on completion of each month hil its realization. /?F/i 495/2010 P(le I oJS I Certify that the digital file and physical file have been compared and the digital data is as per the physical file and no page is missing.

¶3The necessary facts, which are required to he noticed for the disposal of the present appeal, are that the respondent had filed a suit being No.163/2005 for recovery of possession, damages and mesne profits against the appellant herein in respect of the property bearing no.119/89 (New No.89A), Sainik Farms, New Delhi. As per the plaint, the suit property was let out by the respondent. for the residence of appellant no.2, vide registered Lease Deed dated 1.9.1990, for a period of five years. On the expiry of the term of the said lease parties entered into another lease deed for a period of two years w.e.f 1.9.1995 to 31.8.1997 and yet another lease of the same duration was executed expiring on 31.8.1999. it was agreed that the appellants would pay rent at the rate of 85,000/-, per month, excluding electricity, water and maintenance charges. The tenancy was terminated by the respondent or:

1.9.1999 asking for the physical possession of the suit property. As per the plaint, the appellants requested for six months time i.e. Ir upto 29.2.2000 to vacate the suit premises which was granted by the respondent on compassionate grounds. Since the possesson of the suit premises was not handed over by the appeHants 1:0 the respondent, the respondent issued a legal notice dated 8.6.2000 to the appellants, to which no reply was filed by the appellants Respondent also claimed damages for use and occupation at the prevailing market rate of Z2.00 lakhs, per month, and also claim .'ci interest @ 24%, per annum, on the outstanding amounts due. ui.•i .) 5/20 U ('4(! i 1:; During the pendency of the suit, the respondent had made an application under Order Xli Rule 6 CPC, which was allowed by the High Court on 7.5:2002, where the suit had initially been filed. RFA(OS)No.25/2002 filed against the said order of the Single judge was also dismissed by a Division Bench of this Court on 11.7.2005 and Review Applications being No.160/2003 and 161/2003 were also dismissed by the Division Bench. Subsequently, as the pecuniary jurisdiction was enhanced, the case was transferred to District Court on 13.1.2004. Possession of the premises, in question, was t:aken over by the respondent on 1.4.2004. On

11.2.2009, following issues weé framed by the trial court:

¶1Whether the p/a/nt/if/s entitled fbrdamages/mesn' profits? If so, at what rate and from which ;ieriod? OPP Whetler the p/a/nt/If is entitled to ,ntore I? If so, at what rate and for which period? O/'P Relief" Although, respondent had initially claimed mesne profits @ Z2.00 lakhs, per month; on 26.10.99, the respondent restricted his ciaim for damages at the rate of last paid rent, i.e., @Rs.85,001-per month and chose not to lead evidence. The trial court, finding the claim to be just and equitable, thus awarded damages to the respondent @ 85,000/-, per month, for the period of occupation of the premises, in question, i.e. w.e.f. 1.8.2003 to 31.3.2004.

¶5Learned counsel for the appellants has strongly urged before this Court that trial court has exceeded its jurtsdict!on by grnting WA 495120 0 I'aqc 3 ij'5 compound interest to the respondent whereas no such prayer was made by the respondent in the suit filed before the trial court. It is next submitted that respondent had only prayed for int:erest @ 24%, per annum. I have heard counsel for the appellant. In the case of State of Haryana vs. S.L. Arora & Company reported in (2010) 3 SCC 690, the Apex Court has held that specific contract or authority under a stuatue, is a sine qua non for award of compound interest. The relevant portion of the judgment reads as under: 'Compound interest can be awarded only if there is a specific contract, or authority under a statue, for compounding of interest. There is no general discretion in courts or tribunals to award compound interest or interest upon interest." Section 26 of the Delhi Rent Control Act provides only for awarding of simple interest. Applying the law laid down by the Apex Court in SE Arora case (supra), I find force in the submission made by learned counsel for the appellants. The learned trial court has erred in awarding compound interest in exercise of its discretion in the absence of any statutory provision and without giving any rational basis for the same. Having regard to the facts of this case, appellants shaH pay simpe interest @ 12%, per annum, to the respondent. Let he decree sheet be modified accordingly. W. It is point:ed out by learned counsel for the appellants that prindple amount stands deposited and duly wit:hdrawn. Let the interest upto R.'/J 495,'2010 ?;jc 4 G/ o \ V\O WC V ID

1.4.2OO4e paid by the appellants to the respondent within four weeks from today. No other ground has been pressed.

¶11Appeal stands disposed of in above terms. April 19, 2011 G.S. slsTAN. J. m s r' - /9. O4-!

¶4A-4 % 16.09.2011. Present: Mr. C. Mukund with Mr. A.K. Jam, Advocates for the appellant. Mr. M.L. Mahajan with Mr. Gaurav Mahajan, Advocates for the respondent. + CM No.10075/2011 (for modification) in RFA No.495/2010 * This is an application seeking modification of the order dated 19.04.2011 wherein in the concluding portion of para 10 of the order, this Court had directed as under:- "It is pointed out by learned counsel for the appellants that principal amount stands deposited and duly withdrawn. Let the interest uptQl.4.2004 be paid by the appellants to the respondent within four weeks from today." Counsel for the applicant submits that the .amount of rent which was illegally withheld by the appellant was received by him only after an order passed by this Court on 26.11.2010 andthus he would be entitled to interest up to the receipt of this amount i.e. 26.11.2010 and riot: upto 01.04.2004. He further submits that he could not bring this fact to the notice of this Court when the order dated 19.4.2011 was passed as he did not appear on the said date. Counsel for the non-applicant submits that the applicant is not entitled to interest up to 26.11.2010 in view of the fact that the appellant (tenant) had tendered the rent to the applicant by means of a cheque, however, the cheque was not encashed by him. I find no force in the submission of learned counsel for the :1 non-applicant for the reasons that even if the cheque was not encashed by the applicant, the tenant who had issued the cheque, continued to have benefit of the amount in his bank account and thus earned interest on the same. Accordingly, the order dated 19.04.2011 is modified. The date 0104.2004 shall be read as 26.11.2010. Application stands disposed of accordingly. ,

SEPTEMBER 16, 2011 G S SSTANJ vk

65. * IN THE HIGH COURT OF DELHI AT NEW DELHI ± RFA 495/2010 % Judgment Delivered on: .19.04.2011 BHARTIA INDUSTRIES LTD BCH ELECTRIC LTD & ANR Appellants Through : Mr. C. Mukund and Mr. A.K. jam, Advs. versus 414- RAJIV SALUJA Respondent Through : None. CORAM: HON'BLE MR. JUSTICE G.S.SISTANI Whether the Reporters of local papers may be allowed to se. the judgment? To be referred to Reporter or not? Whether the judgment should be reported in the Digest?