Delhi High Court
Vasdev Brothers vs Estate Officer, Itdc Limited And Anr on 8 October, 2018
Equivalent citations: AIRONLINE 2018 DEL 2838
Author: Rajiv Sahai Endlaw
Bench: Rajiv Sahai Endlaw
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of decision: 8th October, 2018.
+ W.P.(C) 315/2012, CM No.19850/2018 (for condonation of 60
days delay in filing written submissions) & CM No.667/2012 (for
stay)
VASDEV BROTHERS ..... Petitioner
Through: Mr. Uttam Datt, Adv.
Versus
ESTATE OFFICER, ITDC LIMITED AND ANR ....Respondents
Through: Mr. Sushant Kumar & Ms. Shikha
Singh, Advs.
CORAM:
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
1. This petition under Article 226 of the Constitution of India was filed
impugning the order [dated 24th December, 2011 in PPA Nos.23/2011
(Unique Case ID No.02403C0035662011) & 24/2011 (Unique Case ID
No.02403C0035652011) of the Court of District Judge, New Delhi acting
as the Appellate Officer under Section 9 of the Public Premises (Eviction of
Unauthorised Occupants) Act, 1971 (PP Act)] of dismissal of appeal, save
for modifying the rate of interest, preferred by the petitioner against the
order [dated 15th April, 2011 of the respondent no.1 Estate Officer of
respondent No.2 India Tourism Development Corporation Ltd. (ITDC) in
exercise of powers under Sections 5 and 7 of the PP Act] of eviction of the
petitioner from Room No.144, ad-measuring 450 sq.ft. at First Floor, Hotel
Janpath, New Delhi and assessing the damages for use and occupation
W.P.(C) 315/2012 Page 1 of 11
payable by the petitioner to the respondent no.2 ITDC for the period of
unauthorized occupation of the said premises.
2. The challenge this petition is confined only to the order of dismissal
of appeal against assessment of damages / mesne profits for use and
occupation. Besides this petition, W.P.(C) No.314/2012 also was filed by
the petitioner challenging the dismissal of the appeal with respect to the
order of eviction.
3. This petition came up first before this Court on 16th January, 2012
and thereafter on 18th January, 2012 when notice thereof was ordered to be
issued and status quo directed to be maintained.
4. On 16th February, 2012, it was the contention of the counsel for the
petitioner that Universal Travellers, similarly placed as the petitioner, was
paying licence fee at Rs.110/- per sq.ft. per month for air conditioned
accommodation and the petitioner offered to take the premises in question
on licence at the current market value of the property.
5. The order dated 3rd August, 2015 records that the petitioner had
vacated the premises and only the dispute with respect to the damages
continued. The counsel for the petitioner informs that axiomatically
W.P.(C) No.314/2012 was withdrawn.
6. Vide the same order dated 3rd August, 2015, the petitioner was
directed to file an affidavit disclosing all his assets and as to how the
liability, in the event of this petition failing, would be met.
W.P.(C) 315/2012 Page 2 of 11
7. On 16th August, 2016, this petition was dismissed in default of
appearance of the petitioner but on application of the petitioner was
restored vide order dated 30th January, 2017.
8. The counsel for the petitioner and the counsel for the respondent
ITDC have been heard and the records perused.
9. The Estate Officer, in his order, with respect to damages, held as
under:
"On the basis of on-going discussions, documents etc. placed before this
Court the answer is affirmative. I therefore hereby in exercise of the powers
conferred upon me as per Public Premise (Eviction of Unauthorized Occupant)
Act-1971 hold the Respondent unauthorised occupant beyond the period of
licence agreement and order that the Respondent is liable to pay outstanding
amount of Rs.1,44,751.50 ps. on account of dues pending as on 30.7.2009 along-
with interest @ 18% p.a. to date of realisation. The Respondent is liable to pay
damages for unauthroised occupation of the Public Premise for the period starting
from 07.9.2009 up to actual handing over of the premise to the Applicant as per
the claim made by the Applicant on following rates:-
(i) 50% of the monthly license fee (applicable at that time) for each day of the
first week of unauthorized occupation.
(ii) 75% of the monthly licence fee (applicable at that time) for each day of the
second week of unauthorized occupation.
(iii) 100% of the monthly licence fee (applicable at that time) for each day of
the third week of unauthorized occupation and
(iv) for each day of unauthorized occupation thereafter 100% monthly license
fee for each day till the possession of the premises are handed over to the
applicant alongwith interest @ 18% p.a.
Rule 8 of the Public Premises (Eviction of Unauthorised Occupants) Rule
1971 provides assessment of damages for unauthorised use and occupation of any
W.P.(C) 315/2012 Page 3 of 11
Public Premise. As per the parameters, it is observed that the Applicant has
undertaken major renovation initiatives in the Hotel Premises as well as the area
in and around the said Public Premise occupied by the Respondent is located.
With such major renovation efforts the value of the Public Premise has increased
manyfold from the point of view of licence fee as well as the level of prospective
licences having strong economic background and paying capacity.
Further, the Respondent has breached the covenents of the licence deed
and has failed to abide by the terms and conditions and therefore the Respondent
is required to handover peaceful possession of the Public Premises within seven
days of publication of this order."
10. The District Judge, in appeal with respect to the challenge to the rate
of damages, held that (i) this Court in Exclusive Motors Pvt. Ltd. Vs. ITDC
2009 SCC OnLine Del 1739 has held that defaulters had flooded the courts
with frivolous litigations and cannot be ordered to block the stream of
justice in this manner; once a person enters into a licence deed with open
eyes knowing fully well the duration was of three years; a licensee has no
right to continue use and occupation of the premises beyond that period; (ii)
the petitioner had been allowed sufficient time and opportunity to lead
evidence and was also allowed lengthy cross-examination of witnesses of
ITDC; (iii) damages had been computed by the Estate Officer taking into
account Rule 8 of the Public Premises (Eviction of Unauthorised
Occupants) Rules, 1971 (PP Rules); and, (iv) however interest awarded by
the Estate Officer was on the higher side; the petitioner should pay interest
at 9% per annum and not at 18% per annum as awarded by the Estate
Officer. Accordingly, the petitioner was directed to pay damages within 30
days.
W.P.(C) 315/2012 Page 4 of 11
11. It is not in dispute that (i) the period of unauthorized occupation is
from 7th September, 2009 to 30th April, 2015 and the damages therefor are
the subject matter of this petition; (ii) the area in occupation of the
petitioner on the first floor of Janpath Hotel at Janpath, New Delhi was 450
sq.ft. and was air-conditioned; (iii) the petitioner was last paying licence fee
at the rate of Rs.17,371.40 paise per month for the aforesaid premises and
the said licence fee was inclusive of air conditioning charges; (iv) the
petitioner till the date of vacation has paid at the rate of Rs.17,371.40 paise
per month and has not paid any other amount to the respondent no.2 ITDC
till now; and, (v) the aforesaid rate of Rs.17,371.40 paise was at the rate of
Rs.37/- per sq.ft. per month.
12. The counsel for the petitioner has argued, that (i) the Estate Officer
assessed the damages without there being any evidence of the same being
the letting value of the property; (ii) Supreme Court in New Indian
Assurance Company Ltd. Vs. Nusli Neville Wadia (2008) 3 SCC 279 was
concerned with the question "Who should begin to lead evidence in a
proceeding" under the PP Act and held in paras no.28 to 30 that where the
application before the Estate Officer is a composite application i.e. for
eviction as well as for damages, "evidence is also required to be led on the
quantum of damages to be determined by the Estate Officer"; (iii) the
Division Bench of this Court in Hindustan Steel (Pvt.) Ltd. Vs. Usha Rani
Gupta AIR 1969 Del 59 held that damages / mesne profits should not be
double the last paid rent without evidence; (iv) the Division Bench of this
Court in Indrawati Kapoor Vs. Union of India 26 (1984) DLT 24 held that
what is the market rent has to be proved and assessed in terms of Section
W.P.(C) 315/2012 Page 5 of 11
7(2) of the PP Act and Rule 8 of the PP Rules; and, (v) as per the order of
the Estate Officer, exclusive of interest, a sum of Rs.2,29,65,502/- is due.
13. I have enquired from the counsel for the petitioner, what evidence
did the petitioner lead of the prevalent letting value of the premises.
14. The counsel for the petitioner states that the petitioner did not lead
any evidence but before this Court along with affidavit has filed reply
received to a query under the Right to Information Act, 2005 made to the
respondent no.2 ITDC to the effect that in the year 2013, out of the 16
shops, 14 shops in the hotel were vacant. It is argued that there were no
takers for the said shops.
15. I have further enquired from the counsel for the petitioner, where has
the petitioner shifted its business after vacation of the subject premises on
30th April, 2015.
16. The counsel for the petitioner states that the petitioner has shut down
its business and is thereafter not carrying on any business.
17. The counsel for the respondent ITDC has drawn attention to para
no.18 of its counter affidavit verified on 20th December, 2012, deposing that
various governmental/semi-governmental and other private parties, at the
contemporaneous time, were paying licence fee in the range of Rs.420/- to
Rs.510/- per sq. ft. per month. Though a statement indicating the licence fee
received by respondent ITDC from its licensees as on 31 st March, 2011 was
purported to be annexed as Annexure-R3 to the said affidavit, but no such
annexure is found to the counter affidavit on record. The counsel for the
respondent ITDC, from his own file has handed over a copy of the said
W.P.(C) 315/2012 Page 6 of 11
Annexure-R3 and which shows licence fee payable for the month of
February, 2012, with respect to five kinds of premises classified as (a)
Shops, (b) Rooms, (c) Other Space, (d), Restaurants, and, (e) Mobile
Towers, with the petitioner Vasdev Brothers being mentioned under the
category (c) Other Space. The rate of licence fee with respect to the spaces
varied from Rs.36.95 sq. ft. per month being paid by the petitioners, to
Rs.428/- per sq.ft. per month being paid by Director General Export
Promotion. However, the said statement also mentions that the occupants
who were paying licence fee at the rate of Rs.110/- per sq.ft. per month and
with respect to the petitioner, disputes were pending consideration. The
licence fee being paid with respect to undisputed premises varied from
Rs.400/- per sq.ft. per month to Rs.428/- per sq. ft. per month.
18. I have enquired from the counsel for the petitioner, whether the said
statement was received by him along with affidavit.
19. The counsel for the petitioner replies in the affirmative.
20. No reply/rejoinder is found to have filed by the petitioner to the said
affidavit/counter affidavit.
21. I have considered the controversy.
22. The judgment of the year 1967 pertaining to a dispute of the year
1957, cannot be a precedent today in the matter of assessment of mesne
profits. It has been held by the Courts in La Medica Mfg. Pvt. Ltd. Vs.
Delhi Development Authority 1998 (45) DRJ (DB), Union of India Vs.
Hem Singh 2015 SCC OnLine Del 9440 and Saradamani Kandappan Vs.
S. Rajalakshmi (2011) 12 SCC 18 that escalation in real estate prices i.e. of
W.P.(C) 315/2012 Page 7 of 11
sale purchase as well as of letting has happened all over the country and
particularly in the city of Delhi since the early and midst 1980s. What was
thus held more than half a century prior hereto cannot hold good today.
Even otherwise, it has been held in Badshah Vs. Urmila Badshah Godse
(2014) 1 SCC 188 that law is a living organism which is based on social
reality and when that social reality changes, law must change too. In
Revanasiddappa Vs. Mallikarjun (2011) 11 SCC 1 it was held that due to
changing social norms in society, what was illegitimate in the past may be
legitimate today, and law cannot afford to be static in a changing society. I
have also followed the said view in Sam Higginbottom University of
Agriculture, Technology & Science Vs. University Grants Commission
(2015) 225 DLT 638 (DB) and Svetlana Kazankina Vs. Union of India
(2015) 225 DLT 613.
23. As far as the other two judgments cited by the counsel for the
petitioner are concerned, though there can be no doubt of the proposition
laid down therein but at the same time it has been held in (i) S. Kumar Vs.
G.R. Kathpalia (1999) 77 DLT 226 (DB), (ii) National Radio and
Electronic Co. Ltd. Vs. Motion Picture Association (2005) 122 DLT 629,
(iii) S&G Company Vs. India Trade Pvt. Ltd. 2013 SCC OnLine Del 2670
(SLP(C) No.(s) 38046-47 preferred whereagainst was dismissed vide order
dated 6th January, 2014), (iv) Suman Verma Vs. Sushil Mohini Gupta
2013 SCC OnLine Del 5081, (v) Zulfiquar Ali Khan Vs. J.K. Helene
Courtis Ltd. ILR (2010) II Delhi 151, (vi) Asman Investments Ltd. Vs.
K.L. Suneja (2011) 181 DLT 156, (vii) Aashish Aggarwal Vs. State Bank
of Patiala (2012) 189 DLT 153, (viii) Amresh Bajaj Vs. National Hydro
W.P.(C) 315/2012 Page 8 of 11
Electric Power Corporation (2017) 245 DLT 564, (ix) Basant & Co. Vs.
Osram India Pvt. Ltd. (2018) 248 DLT 658, (x) Modi Infosol Pvt. Ltd. Vs.
Sukhdev Kaur 2018 SCC OnLIne Del 9916 and (xi) M.C. Agarwal HUF
Vs. Sahara India (2011) 183 DLT 105 that the Courts are entitled to take
judicial notice of the prevalent rate of rents, particularly with respect to
commercial areas, where there are a large number of lettings and of which
areas a large number of cases come before this Court.
24. The option of remanding the matter to the Estate Officer for fresh
evidence, as would be the want of the petitioner, is not found appropriate
considering that this petition itself has been pending in this Court for the
last six years and the dispute between the parties has also festered for the
last nearly nine years. The Additional District Judge has already in the
impugned judgment referred to Exclusive Motors Pvt. Ltd. supra to hold
that the persons overstaying in public premises deserves no sympathy from
the Court and do not deserve judicial time. Mention in this regard may also
be made of (i) Ram Niwas Vs. Estate Officer 2018 SCC OnLine Del
10285, (ii) Bhupinder Singh Malik Vs. Estate Officer 2018 SCC OnLine
Del 9733 (LPA No.385/2018 preferred whereagainst has been dismissed
vide order dated 20th July, 2018), (iii) Chaman Lal Vs. Delhi Jal Board
2018 SCC OnLine Del 9800 (LPA No.430/2018 preferred whereagainst has
been dismissed vide order dated 10th August, 2018), (iv) Tejpal Gautam Vs.
Central Public Works Department 2018 SCC OnLine Del 10484 (LPA
No.489/2018 preferred whereagainst has been dismissed vide order dated
28th September, 2018), where it has been held that public premises vest with
the public and this Court, while dispensing justice, cannot distribute
W.P.(C) 315/2012 Page 9 of 11
largesse and sympathy for one will always come at the cost of another who
is equally deserving of sympathy. It cannot be lost sight of that the
petitioner, inspite of knowing that its licence to occupy the premises was
valid till 6th September, 2009, overstayed in the premises till 30 th April,
2015 i.e. for nearly six years, invoking the process of law and which
process was ultimately abandoned. From the petitioner abandoning its writ
petition against the order of eviction itself, it is evident that the petitioner
was well aware that it has no case to defend the proceedings for eviction
and was merely using the process of the Court for prolonging the same and
when found the said process to be coming to a close, abandoned the same.
The petitioner was well aware that for the period of unauthorised
occupation it would be liable to pay damages/mesne profits. The petitioner
still did not bother to lead any evidence of the prevalent rents in the
locality. Therefrom, adverse inference can be drawn that the petitioner
knew that the prevalent rents were more than Rs.110/- per sq. ft. per month,
which the petitioner itself at one stage, as recorded hereinabove in this
judgment, had offered to pay. Considering all the said facts and further
considering the fact that the petitioner has not controverted the statement
filed by the respondent No.2 along with its counter affidavit, of the
prevalent rent being paid by others, it is felt that this petition be disposed of
by modifying the rate of mesne profits from that assessed by the Estate
Officer and upheld by the Additional District Judge, to the minimum of the
rate then being received by the respondent ITDC for similar
accommodation i.e. at the rate of Rs.400/- per sq. ft. per month.
W.P.(C) 315/2012 Page 10 of 11
25. It is accordingly directed that the petitioner, instead of the rate as
stipulated in the order of the Estate Officer, shall be liable to pay mesne
profits @ Rs.400/- per sq. ft. per month for the area of 450 sq. ft. with
effect from 6th September, 2009 till 30th April, 2015, minus the amount if
any already paid by the petitioner.
26. The definition of 'mesne profits' in Section 2(xii) of the CPC
requires interest also to be awarded. It also cannot be lost sight of that the
mesne profits at the said rate were payable by the petitioner month by
month, either in advance or latest by the end of the month to which the
mesne profits pertained. The Additional District Judge, in the impugned
order has already modified the rate of interest from 18% to 9% per annum
and which is found to be in order. It is thus directed that the petitioner, on
the amount due for each month, with effect from the end of the month to
which the mesne profits pertained, till the date of payment of mesne profits,
shall also be liable for interest @ 9% per annum.
27. However, since this Court in writ jurisdiction has interfered with rate
of mesne profits, no costs.
28. The petition is disposed of.
RAJIV SAHAI ENDLAW, J.
OCTOBER 08, 2018 'gsr/bs' W.P.(C) 315/2012 Page 11 of 11