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In Case Of Eviction Order Stayed In Favour Of The Tenant, Landlord Is To Be Granted Mesne Profit

Yashvardhan Gullapalli ,
  09 July 2022       Share Bookmark

Court :
The Supreme Court of India
Brief :

Citation :
Civil Appeal No. 4646-47 of 2022

Case title:
M/s.Martin & Harris Private Limited & Anr. Versus Rajendra Mehta & Ors

Date of Order:
06/07/2022

Bench:
Justice Indira Banerjee; Justice J.K. Maheshwari

Parties:
M/s. Martin & Harris Private Limited – Petitioner
Rajendra Mehta &Ors – Respondent

Subject

The Supreme Court declared it mandatory to fix a certain amount of mesne profits payable to the owner of the property from the date of an eviction order against the tenant granted and approved by a competent authority.

Facts

  • The original plaintiffs were the landlords of the property in Jaipur where the appellant was a tenant. The plaintiffs filed a suit under Section 13 of the Rajasthan Premises (Control and Eviction) Act, 1950 for eviction, repossession, and compensation of rent.
  • First (above) and the second appeal filed before the Additional District Judge No. 7 Jaipur were dismissed.
  • The plaintiff took the matter to the high court where the appeal was admitted and a stay was granted on the eviction. And in response to the plaintiffs demanding a mesne profit be fixed for the period of eviction being stayed. The amount was fixed at Rs. 2,50,000/- per month.
  • Arguments Advanced by Appellant
  • The plaintiffs contended that under Section 20 of the Rajasthan Rent Control Act, 2001 if the property is rented out for a business, the amount of mesne profit discharged cannot go above the ceiling of 3 times the market value.
  • The counsel for the plaintiff further contended that the mesne profit fixed by the Hon'ble High Court was not proportional to the above-discussed provision. Considering the year the premises were built, the property's location, which is on an inside road of a colony, and the DLC rate.
  • As a result, the order in question is liable to be quashed, and the total amount of mesne profits may be revised to Rs. 1,35,000/­ per month or three times the rent at market value.

Judgment

  • The court placed reliance on the case of Marshall Sons & Co. (I) Ltd. vs. Sahi Oretrans (P) Ltd. and Another, where it was held that The Supreme Court ruled that if the execution of an eviction decree for possession is postponed, denying the decree-holder of the opportunity to reap the benefits, it is requisite for the appellate court to issue necessary directions setting reasonable maintenance fees, which may be comparable to the market rent that the person in possession of the property must pay.
  • The case of Atma Ram Properties (P) Ltd. vs. Federal Motors (P) Ltd, was also referred to by the court in which it was held that the appellate court has the authority to impose reasonable restrictions and conditions that, in its opinion, would be appropriate to make up for any harm caused to the decree-holder by the delay in the implementation of the order while awarding the stay.
  • It was held by the bench that the 2001 Act came into force in the April of 2004 and was not compatible with the 1950 Act as insinuated in the case. It was also held that the grounds of ascertaining mesne profit requires incorporating many variables and differs from situation to situation.

Conclusion

Therefore, it was held by the Hon’ble Justices JK Maheshwari and Indira Banerjee that immediately after a tenancy is terminated through the issuance of an eviction order, the landlord is owed mesne profits as they are being denied access to their property due to the tenant still occupying it.

Learn the practical aspects of CrPC HERE, CPC HERE, IPC HERE, Evidence Act HERE, Family Laws HERE, DV Act HERE

Click here to download the original copy of the judgement

 
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