Case Note & Summary
The appellants, original plaintiffs, claimed ownership of suit premises and alleged that the respondent-defendant was a tenant at will under an unregistered Memorandum of Understanding dated 5-3-2002. The defendant failed to pay rent from 17-2-2010 and continued business after termination of tenancy. The plaintiffs sought temporary injunction restraining the defendant from carrying on hotel business and construction, and for deposit of Rs.75,000/- per month as mesne profits. The Trial Court partly allowed the application, directing deposit of Rs.29,040/- per month (the agreed rent) from 17-2-2010. The plaintiffs appealed, contending that the rate should be Rs.75,000/- per month based on market rent. The High Court held that in the absence of a registered lease deed, the tenancy was month-to-month and stood terminated by notice. The defendant became a tenant at sufferance liable to pay mesne profits at market rate. However, the court found that the Trial Court's order was interim and the plaintiffs could lead evidence to prove market rent in the suit. The court also refused to restrain the defendant from business or construction, as no prima facie case was made out. The appeal was partly allowed, directing the defendant to deposit Rs.29,040/- per month from 17-2-2010, with liberty to the plaintiffs to apply for enhancement after evidence.
Headnote
A) Civil Procedure - Mesne Profits - Order 39 Rule 10 CPC - Tenant at sufferance - In the absence of a registered lease deed, the tenancy is month-to-month and can be terminated by notice. After termination, the tenant becomes a tenant at sufferance liable to pay mesne profits at market rate. The court directed deposit of Rs.29,040/- per month from 17-2-2010, being the agreed rent, but held that the plaintiffs are entitled to mesne profits at market rate from the date of termination, which may be determined in the suit. (Paras 1-10) B) Property Law - Lease - Registered Lease Deed - Section 107 Transfer of Property Act, 1882 - A lease for a term exceeding one year must be registered. In absence of registration, the lease is deemed to be a month-to-month tenancy. The Memorandum of Understanding dated 5-3-2002 was not registered and hence did not create a valid lease for five years. (Paras 4-6) C) Civil Procedure - Temporary Injunction - Order 39 Rules 1 and 2 CPC - The court refused to restrain the defendant from carrying on business or construction, as the plaintiffs failed to establish a prima facie case for such relief. The balance of convenience was in favour of allowing the defendant to continue business subject to deposit of mesne profits. (Paras 3, 10)
Issue of Consideration
Whether the Trial Court was justified in fixing the rate of mesne profits at Rs.29,040/- per month instead of Rs.75,000/- per month as claimed by the plaintiffs, and whether the defendant should be restrained from carrying on business and construction activity.
Final Decision
Appeal partly allowed. The order of the Trial Court is modified to the extent that the respondent shall deposit Rs.29,040/- per month from 17-2-2010 till decision of suit, and arrears from 17-2-2010 to 30-11-2011 within two months. The appellants are at liberty to withdraw the amount. The rest of the order is confirmed. No order as to costs.
Law Points
- Mesne profits
- Tenant at sufferance
- Lease termination
- Registered lease deed
- Market rent
- Order 39 Rule 10 CPC
- Section 2(12) CPC
