Case Note & Summary
The case involves a dispute between Bata India Limited (the applicant/tenant) and Bindiya Co-operative Housing Society Limited (the respondent/landlord) regarding mesne profits for the period after termination of tenancy. The applicant was a tenant of Shop No. 8 in the respondent's building since 1958 at a monthly rent of Rs.200, later increased to Rs.313. The respondent terminated the tenancy by legal notice dated 11 September 2001 and filed T.E. Suit No.21/23 of 2002 for eviction and mesne profits inquiry under Order XX Rule 12 CPC. The eviction suit was decreed on 2 August 2005, and the appeal and revision were dismissed, with the Supreme Court granting time to vacate by 31 March 2012. Meanwhile, the respondent filed Mesne Profits Application No.6 of 2010, seeking determination of mesne profits from 22 January 2002 (date of termination) to 31 March 2012. The Small Causes Court appointed a Court Commissioner to assess mesne profits, who submitted a report valuing the premises at Rs.1,24,099 per month based on market rent. The trial court accepted this report and awarded mesne profits at that rate with 6% interest. Both parties appealed: the applicant challenged the rate and interest, while the respondent sought higher mesne profits. The Appellate Court upheld the trial court's order. The applicant then filed the present Civil Revision Application. The High Court examined the evidence, including the valuer's report and the applicant's failure to produce contrary evidence. The court held that the mesne profits were correctly determined based on market rent, as the tenant's possession after termination is unlawful and not protected by rent control laws. The court also upheld the 6% interest rate as reasonable. The revision was dismissed, confirming the mesne profits at Rs.1,24,099 per month with interest at 6% per annum from the date of the application until realization.
Headnote
A) Property Law - Mesne Profits - Determination of Market Rent - Order XX Rule 12, Code of Civil Procedure, 1908 - The court considered the correct approach for determining mesne profits when the tenant continues in possession after termination of tenancy. The court held that mesne profits are to be assessed based on market rent, not the controlled rent under the Rent Act, and that the evidence of an approved valuer can be relied upon. (Paras 2-5) B) Evidence Act - Expert Evidence - Valuation Report - Sections 45, 46, Evidence Act, 1872 - The court examined the admissibility and weight of a valuation report prepared by a government-approved valuer. The court held that such report is admissible as expert evidence and can form the basis for determining mesne profits, especially when not effectively challenged. (Paras 6-10) C) Interest - Mesne Profits - Rate of Interest - Order XX Rule 12, Code of Civil Procedure, 1908 - The court considered the appropriate rate of interest on mesne profits. The court held that interest at 6% per annum from the date of filing of the mesne profits application until realization is reasonable and in line with precedents. (Paras 11-15)
Issue of Consideration
Whether the Appellate Court correctly determined the rate of mesne profits at Rs.1,24,099 per month and whether interest at 6% p.a. is justified.
Final Decision
The Civil Revision Application is dismissed. The impugned judgment and order dated 5 September 2022 passed by the Appellate Court is confirmed. The applicant is directed to pay mesne profits at the rate of Rs.1,24,099 per month for the period from 22 January 2002 to 31 March 2012 along with interest at the rate of 6% per annum.
Law Points
- Mesne profits
- Market rent
- Expert evidence
- Order XX Rule 12 CPC
- Interest on mesne profits
