Case Note & Summary
The appeal arose from a landlord-tenant dispute over rent for the period 01.11.2015 to 31.01.2017. The landlord, Sadhana Foundation, claimed rent at Rs. 18,43,900 per month based on an unregistered lease deed dated 01.01.2013. The tenant, M/s Espire Infolabs Pvt Ltd, contended that a subsequent registered lease deed dated 01.09.2015, effective from 01.03.2015, governed the relationship, fixing rent at Rs. 7,50,000 per month. Additionally, the tenant claimed entitlement under Clause 1(c) of the 2015 deed to spend approximately Rs. 9 crores on developing the premises and adjust that amount against rent. In earlier proceedings, the Rent Controller had fixed provisional rent at Rs. 7,50,000 per month, which was upheld by the High Court and the Supreme Court in a prior SLP. In the present petition, the Rent Controller again fixed provisional rent at Rs. 7.50 lakhs per month, and the High Court upheld it. The Supreme Court noted several disputed issues: which lease deed governs, whether Ajay Sharma (who executed the 2015 deed) was a valid trustee, and the actual amount spent by the tenant. The Court observed that the 2013 deed was unregistered and possibly inadmissible, and that the tenant had placed some material on record regarding expenditure in this petition, unlike the earlier one. Balancing equities, the Court directed that the tenant pay provisional rent at Rs. 3.75 lakhs per month from 01.11.2015, deposit arrears at that rate by 31.01.2020, and furnish tangible surety of Rs. 3 crores. The Rent Controller was directed to expedite the trial and dispose of the matter within six months.
Headnote
A) Property Law - Lease - Provisional Rent - Balancing Equities - Transfer of Property Act, 1882, Section 105 - Dispute between landlord and tenant over applicable lease deed and rent rate - Tenant claimed entitlement to adjust Rs. 9 crores spent on infrastructure against rent under registered lease deed of 2015 - Supreme Court reduced provisional rent from Rs. 7.50 lakhs to Rs. 3.75 lakhs per month to balance equities, directed deposit of arrears and furnishing of surety of Rs. 3 crores, and expedited trial (Paras 5-7).
Issue of Consideration
Whether the provisional rent fixed by the Rent Controller and upheld by the High Court should be modified pending final adjudication of the eviction petition, considering the tenant's claim of entitlement to adjust expenditure against rent under a subsequent registered lease deed.
Final Decision
Appeal disposed of with directions: (i) Tenant to pay provisional rent @ Rs. 3.75 lakhs per month w.e.f. 01.11.2015 till final disposal; (ii) Tenant to deposit arrears at that rate from 01.11.2015 to 30.11.2019 by 31.01.2020; (iii) Tenant to furnish tangible surety of Rs. 3 crores to Rent Controller; (iv) Rent Controller to dispose of matter within 6 months on day-to-day basis.
Law Points
- Provisional rent determination
- Balancing equities
- Admissibility of unregistered lease deed
- Burden of proof for expenditure adjustment
