Karnataka High Court
Smt Geetha Krishnamurthy vs Sri Haroon Rasheed on 11 September, 2013
Bench: Mohan.M.Shantanagoudar, B.Sreenivase Gowda
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IN THE HIGH COURT OF KARNATAKA AT BANGALORE
TH
DATED THIS THE 11 DAY OF SEPTEMBER 2013
PRESENT
THE HON'BLE MR.JUSTICE MOHAN .M. SHANTANAGOUDAR
AND
THE HON'BLE MR.JUSTICE B. SREENIVASE GOWDA
R.F.A NO.686/2006
C/W.
R.F.A.NO.800/2006
IN R.F.A NO.686/2006
BETWEEN :
Smt. Geetha Krishnamurthy
W/o V.M. Krishnamurthy
Aged about 60 years
R/o No.14, Nehru Nagar
Bangalore-560 020. ..Appellant
(By Sri K.S. Srinivasa, Adv.,)
AND :
1. Sri Haroon Rasheed
aged about 58 years
2. Mohamood Shah
Aged about 56 years
3. Mustafa Kamal
aged about 54 years
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4. Mohamed Alam
aged about 50 years
All are sons of late G.A. Wahab
M/s. Abdul Wahab and Sons
Presently carrying on business
At No.172, New Old No.14
Commercial Street, Civil Station
Bangalore-560 001. ..Respondents
(R1 & R2 served & unrepresented;
R3 and R4 notice held sufficient)
RFA filed under Section 96 of CPC., against the
Judgment and Decree dated 10.2.2006 passed in
O.S.No.5765/2000 on the file of the XV Addl. City Civil and
Sessions Judge, Bangalore partly decreeing the suit for
ejectment.
IN R.F.A NO.800/2006
BETWEEN :
Smt. Geetha Krishnamurthy
W/o V.M. Krishnamurthy
Aged about 60 years
R/o No.14, Nehru Nagar
Bangalore-560 020. ..Appellant
(By Sri K.S. Srinivasa, Adv.,)
AND :
1. Sri Haroon Rasheed
aged about 58 years
2. Mohamood Shah
Aged about 56 years
3. Mustafa Kamal
aged about 54 years
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4. Mohamed Alam
aged about 50 years
All are sons of late G.A. Wahab
M/s. Abdul Wahab and Sons
Presently carrying on business
At No.172, New Old No.14
Commercial Street, Civil Station
Bangalore-560 001. ..Respondents
(By Sri Shanmukhappa, Adv., for R1;
R2, R3 and R4 served)
RFA filed under Section 96 of CPC., against the
Judgment and Decree dated 10.2.2006 passed in
O.S.No.5979/2000 on the file of the XV Addl. City Civil and
Sessions Judge, Bangalore partly decreeing the suit for
declaration, mandatory injunction.
These RFAs., having been heard, reserved and
coming on for pronouncement of judgment, this day
MOHAN .M. SHANTANAGOUDAR, J., delivered the
following:-
JUDGMENT
These appeals are directed against the judgment and decree dated 10.2.2006 passed by the 15th Additional City Civil Court, Bangalore City, in O.S.No.5765/2000 and O.S.No.5979/2000.
2. Plaintiff in O.S.No.5765/2000 is the landlord of the suit schedule property. The defendants in the -4- said suit are the tenants over the suit schedule property. The parties are hereinafter referred to as the 'landlord' and 'tenants' for the shake of convenience.
3. O.S.No.5765/2000 is filed by the landlord seeking relief of ejectment of the tenants from the suit schedule property and for a direction to pay the arrears of rents and also for damages.
O.S.No.5979/2000 is filed by the tenants seeking relief of declaration that they are entitled to Rs.56,000/- towards the expenses incurred by them for carrying out the civil works and for mandatory injunction directing the landlord to execute a registered lease deed for a period of 30 years in their favour and for determination of rents payable to the landlord in respect of the suit schedule property and for the relief of permanent injunction. The plaintiff in O.S.No.5765/2000 is the defendant in O.S.No.5979/2000 and plaintiffs in O.S.No.5979/2000 are the defendants in O.S.No. 5765/2000. -5-
4. The case of the landlord is that she is the absolute owner of the suit schedule property bearing Old No.172 (New No.14), Commercial Street, Bangalore; the tenants were occupying the lower portion of the aforementioned property on a monthly rent of Rs.10,000/-; the landlord initiated eviction proceedings against the tenants in HRC.No.109/1989 before Small Causes Court, Bangalore; said proceedings were initiated against Sri G.Abdul Wahab, who was the Proprietor of Abdul Wahab & Sons, a Tailoring Firm; the tenants herein are the legal representatives of said G.Abdul Wahab, who expired leaving behind the tenants herein as his legal heirs and the said HRC.No.109/1989 came to be settled between the parties by recording the compromise on 19.3.1998; based on the compromise petition it was ordered that the tenants should vacate the premises on or before 30.11.1998 in order to facilitate the landlord to demolish the old construction and to erect -6- new construction and to provide the lowest floor of the newly constructed building to the tenants within a period of six months; the tenants did not vacate the premises as agreed by them in the compromise petition filed in HRC.No.109/1989; this led the landlord to file Execution Petition No.3843/1998; a delivery warrant dated 12.4.1999 was issued and on the same day, possession of the property was taken by the landlord with the assistance of the Court; thereafter the landlord demolished the old building and constructed the new building as per the approved plan and delivered possession of the lowest floor of the new building to the tenants on 5.11.1999.
It is further case of the landlord that the tenants failed to pay rents regularly in respect of the newly occupied premises and they became defaulters; they also sub-let a portion of the premises let to them; consequently, the landlord issued a notice of termination of tenancy with a request to the tenants -7- to vacate and hand over vacant possession of the suit schedule property in her favour; even after receipt of notice, the tenants neither paid the rents nor vacated the premises in question; the tenants are in arrears of rents to the tune of Rs.80,000/-; they are also liable to pay damages by way of mesne profit at the rate of Rs.10,000/- per month, with interest thereon at 24% per annum. On these among other grounds, the landlord prayed for relief of ejectment of the tenants from the suit schedule property and for a direction to pay a sum of Rs.90,000/- and interest thereon apart from future damages at the rate of Rs.10,000/- per month.
5. The defence of the tenants is that the landlord was required to execute registered lease deed for a period of 30 years as per the compromise petition filed in HRC.No.109/1989, which was not done by her; the tenancy has not yet commenced legally as per the compromise petition and in view of failure on the part -8- of the landlord to execute the registered lease deed in favour of the tenants; though they agreed for occupying the lowest floor, they did not agree for occupying the cellar floor of the newly constructed building; in other words, they wanted to occupy the ground floor of the newly constructed building; the landlord has not constructed the building as per the approved plan and that correspondence is still going on between the landlord and the Corporation Authorities; they denied the contention of the landlord that they have sub-let a portion of the schedule property in favour of any person; since the lease is for a period of 30 years, question of termination of tenancy does not arise; they also denied their liability of paying damages.
6. The sum and substance of the case of the tenants in O.S.No.5979/2000 is that the landlord did not furnish the copy of the sanctioned plan as per Ex.P16 to the tenants and hence the tenants refused -9- to vacate and deliver the possession of the schedule property to the landlord as per the compromise petition filed in HRC.109/1089; however the landlord took possession of the suit schedule property by filing Execution Petition No.3843/1998 and demolished the entire structure and reconstructed the building; even at the time of reconstruction, copy of the sanctioned plan was not furnished to the tenants by the landlord; though the tenants had got grievance against the landlord, ultimately, the dispute was settled with the intervention of common friends on 5.11.1999 and possession of the schedule premises was handed over to the tenants by receiving advance amount of Rs.1,50,000/-; till the taking possession of the suit schedule premises, they were not aware of the condition of the building, inasmuch as they were not allowed to go near the construction spot; on entering the premises in question, the tenants came to know that certain civil works were yet to be completed;
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since the landlord did not complete the entire work of civil construction, the tenants spent certain amounts for decorating the premises; when the work of decoration was in progress, the officials of Bangalore City Corporation visited the spot and asked the tenants not to proceed with the decoration work on the ground that the Corporation has issued notice under Section 32(1) of the Karnataka Municipal Corporation Act for demolition of deviated portion of the building, including the cellar portion; that the lowest floor of the building does not mean the cellar floor and more over the measurement of the premises provided to the tenants is less than 750 square feet; the landlord was required to provide premises to the tenants on par with M/s.Royal Tailoring Firm, situated at No.12, Commercial Street, Bangalore, but she failed to do so, inasmuch as the schedule premises is 1½ feet below the ground as compared to the said M/s.Royal Tailoring Firm; they spent total amount of
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Rs.56,000/- for completion of civil works, which is liable to be paid by the landlord; 4KVA power supply to the premises in question was not made by the landlord as was available prior to demolition; a cage was fixed at North-West corner, i.e., at the entrance of the schedule property; there was no toilet facility provided, etc. Based on these among other grounds, the suit for declaration came to be filed by the tenants in O.S.No.5979/2000 praying for recovery of Rs.56,000/- spent by them for carrying out the civil works and such amount be adjusted towards the rents payable to the landlord after determination of the quantum of rents. The decree for mandatory injunction was also sought for against the landlord to make available 4KVA power supply to the suit schedule property and to remove the cage fixed at North-West corner and to provide toilet facility, etc.
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The written statement is filed by the landlord in the said suit denying all the contentions raised in the plaint by the tenants.
Based on the aforementioned pleadings, the Trial Court framed the following issues:-
In O.S.No.5765/2000:
i) Whether the suit of the plaintiff is bad for non-joinder of necessary parties?
ii) Whether the termination of tenancy is in accordance with law?
iii) Whether the plaintiff is entitled to damages at the rate of Rs.10,000/-
per month?
iv) Whether the plaintiff is entitled to Rs.80,000/- towards the arrears of rents from 5.11.1999?
v) Whether the plaintiff is entitled to interest at the rate of 25% p.a. towards the arrears of rents?
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vi) Whether the plaintiff is entitled to possession?
vii) To what order and relief the parties are entitled?
In O.S.No.5979/2000:
i) Whether the plaintiffs are entitled for a declaration that they are entitled for a sum of Rs.56,000/-
from the defendant?
ii) Whether plaintiffs prove that defendant did not fulfill the terms of compromise entered in HRC.No.109/1989?
iii) Whether plaintiffs are entitled for relief of mandatory injunction as prayed for?
iv) Whether the plaintiffs are entitled for permanent injunction as sought for?
v) Whether defendant be directed to execute a registered lease deed for
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a period of thirty years as per compromise entered into in HRC.No.109/1989 dated 19.3.1998?
vi) Whether the rent payable from the
plaintiffs to defendant be
determined in this suit with respect to suit schedule B property?
vii) Whether Court fee paid by the plaintiffs is proper and correct?
viii) What order or decree?
Both the suits were clubbed and heard together by the Trial Court and are decided by the common judgment and decree dated 10.2.2006.
7. Landlord examined herself as PW.1 and one of the tenants, viz., Haroon Rasheed got examined himself as DW1. On behalf of the landlord, 13 documents were got marked and on behalf of the tenants, 29 documents were got marked. The Trial Court on evaluation of the material on record decreed
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O.S.No.5765/2000 in part holding that the landlord is entitled to Rs.90,000/- as arrears of rents to be paid by the tenants from 5.11.1999. However, the suit of the landlord for ejectment of tenants and for interest at 24% p.a. and also for direction to pay damages at the rate of Rs.10,000/- per month is dismissed.
8. The suit filed by the tenants i.e., O.S.No.5979/2000 was also decreed in part with a direction to the landlord to permit the tenants to use the existing latrine situated at South-East corner of the suit schedule property. Further direction is issued against the landlord to execute the registered lease deed for a period of 30 years in favour of the tenants in respect of the suit schedule property as per the terms of compromise entered into between the parties in HRC.No.109/1989. The direction is also issued to the landlord to deliver one set of keys of the main shutter of the suit schedule property to the tenants. However, the suit of the tenants in respect of
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declaration that they are entitled for a sum of Rs.56,000/- and for mandatory injunction seeking direction to the landlord to make them available 4KVA of power supply and for removal of cage fixed at North-West corner came to be dismissed.
9. RFA.No.686/2006 is filed by the landlord against the aggrieved portion of the judgment and decree passed by the Trial Court in O.S.No.5765/2000.
RFA.No.800/2006 is also filed by the landlord against the portion of the judgment and decree passed by the Trial Court which went against the landlord in O.S.No.5979/2000.
Since both the appeals are arising out of the common judgment and as both the suits were clubbed and heard together, the appeals are taken up for final hearing jointly and are decided by the common judgment.
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10. Learned counsel appearing for both the parties have taken us through the material on record, including the judgment of the Court below and submitted their respective arguments.
10. Sri Srinivas learned advocate appearing on behalf of the landlord/appellant submits that in spite of compromise petition entered into between the parties in HRC.No.109/1989, the tenants did not hand over the possession of the suit schedule property over which the tenants were in possession for a period of 4½ months after the compromise decree; this compelled the landlord to file Execution Petition No.3843/1998 for getting the possession of the suit schedule property from the tenants; the possession of the suit schedule property was taken through Court in execution proceedings and thereafter the old building was demolished and reconstructed in accordance with the sanctioned plan; as per the terms of the
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compromise petition in HRC.No.109/1989, the lowest floor of the building had to be provided to the tenants; accordingly, the lowest floor was offered to the tenants; despite the same, the tenants failed to occupy the premises for same period; ultimately, the tenants took possession of the premises on 5.11.1999 and accordingly it was the duty of the tenants to pay rents from 5.11.1999; unfortunately, the tenants became defaulters in paying the rents; the tenants did not pay the rents as and when they became due and payable and they did not even pay the electricity charges; since the tenants committed default in payment of rents as and when the rents fell due, the only course open for the landlord was to terminate the tenancy and accordingly, the tenancy was terminated by issuing notice dated 22.4.2000; there was no requirement on the part of the landlord to execute the registered lease deed in favour of the tenants as per the compromise terms; the tenants have taken
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untenable contentions in the reply to the notice sent by the landlord as well as in the suit; since the tenants have failed to comply with the terms of compromise, they are liable to be evicted; the entire building was completed and therefore it was incumbent on the part of the tenants to pay the rents; the landlord has not violated the terms of compromise at any point of time; though the Trial Court is justified in decreeing the suit for Rs.90,000/- against the tenants, it is not justified in dismissing the suit of the landlord for ejectment; thus the appeal came to be filed questioning the correctness and legality of the judgment of the Trial Court in respect of rejection of prayer of the landlord; during the subsistence of the suit also, the tenants failed to pay the rents and arrears of rents to the tune of Rs.3,72,000/- and therefore the landlord was constrained to approach this Court by filing WP.No.15385/2005 c/w.WP.No.15386/2005(GM-CPC), which came to be
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disposed of on 22.6.2005, with a direction to the tenants to deposit arrears of rents of Rs.3,72,500/- as on that day within a period of eight weeks from 22.6.2005. The said order was challenged in SLP.No.17424/2005 by the tenants, which came to be dismissed.
Learned counsel appearing for the appellant further submitted that the Trial Court ought to have dismissed the suit filed by the tenants in toto; the Trial Court is not justified in directing the landlord to execute the registered lease deed for a period of 30 years in favour of the tenants in respect of the suit schedule property as per the compromise entered into in HRC.No.109/1989.
12. Per contra, Sri Shanmukhappa, learned counsel appearing on behalf of respondents-tenants argued in support of the judgment of the Court below. He submits that the tenants were not at fault at any
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point of time; since the copy of the sanctioned plan of the building was not furnished to the tenants at the time of construction and even thereafter, the tenants were not in a possession to know as to whether the civic amenities were made available to the premises or not and this has led to some delay on the part of the tenants in paying the rents; the landlord was required to execute the registered lease deed for a period of 30 years in favour of the tenants as agreed by her in the compromise petition filed in HRC.No.109/1989, but she has failed to do so; in spite of repeated requests to her, necessary civic amenities were not made available to the premises in question as per the compromise; though the landlord was required to hand over the ground floor i.e., lowest floor of the building, she has gone back on the said promise and handed over the cellar portion which is not on par with M/s.Royal Tailoring Firm, situated at No.12, Commercial Street, Bangalore; as the landlord
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contravened the terms of compromise in the aforementioned manner, the suit filed by her for recovery of rents ought to have been dismissed by the Trial Court. Learned counsel for the tenants supported the judgment of the Trial Court which directs the landlord to execute the registered lease deed in favour of the tenants.
13. From the rival contentions of the learned advocates appearing on behalf of both parties, the following points would arise for our consideration:-
1) Whether the Trial Court is justified in directing the landlord to execute the registered lease deed for a period of 30 years in favour of the tenants?
2) Whether the Trial court is justified in refusing the prayer of the landlord relating to interest on the delayed payment of rent and payment of damages at the rate of Rs.10,000/-
per month?
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3) Whether the Trial Court is justified in dismissing the suit of the landlord for ejectment of the tenants?
14. Before proceeding further, it is beneficial to note the undisputed facts of the case, which are as under:-
The landlord-appellant filed HRC.No.109/1989 for eviction of the tenants-respondents under Section 21(1)(h) and (j) of the Karnataka Rent Control Act from the premises, as was then existed. In the said eviction petition, the landlord had prayed for possession of the suit schedule property on the ground that the same was needed for her bona fide use and personal occupation and for demolition and reconstruction of the new building.
On 20.2.1998, the landlord and tenants filed compromise petition under Order XXIII Rule 3 of CPC.
As per the terms of compromise, the tenants had to vacate the suit schedule property and landlord
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undertook to demolish the old building and reconstruct the building and to let out a portion of the building in the lowest floor on enhanced rent for a period of 30 years as long as the tenants do not commit an act of default. HRC.No.109/1989 came to be disposed of by virtue of the compromise petition arrived at between the parties as mentioned supra and the prayer of the landlord for getting possession of the suit premises on the ground that the same was needed for her bona fide use and personal occupation, came to be dismissed. HRC.No.109/1989 came to be disposed of on 19.3.1998 as mentioned supra with a direction to the tenants to deliver vacant possession of the suit schedule property on or before 30.11.1998. The landlord was directed to demolish the existing building within a month from the date of handing over vacant possession by the tenants and put up new construction within a period of six months from the date of handing over vacant possession. The landlord
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was also directed to re-admit the tenants in possession of the suit premises in accordance with the compromise petition (Ex.P1).
Since the tenants did not hand over the possession of the suit schedule property in accordance with the compromise arrived at between the parties, the landlord filed the Execution Petition No.3843/1998 for executing the compromise decree passed in HRC.No.109/1989. In the said Execution Petition the tenants filed an application under Order XXI Rule 26 of CPC to stay the compromise decree dated 19.3.1998 passed in HRC.No.109/1989. The said application came to be dismissed and delivery warrant was issued to take possession of the suit premises and to reconstruct the building.
On 12.4.1999, the landlord took possession of the suit schedule property and reconstructed the building. On 5.11.1999, the landlord handed over the
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lowest floor of the new building to the tenants by receiving an advance amount of Rs.1,50,000/- and tenants were put in possession on the basis of the compromise petition.
On 3.9.1999 the landlord filed suit in O.S.No.6831/1999 for permanent injunction restraining the Bangalore City Corporation from demolishing the building on the ground that the building has been constructed in accordance with the approved plan. On 19.5.2000, tenants filed O.S.No.3304/2000 for decree of permanent injunction against the landlord restraining her from leasing out the suit premises in favour of the third parties. On 28.6.2000, a joint memo was filed by both the parties and in the said joint memo the landlord undertook that if the Corporation refuses to regularize the construction/deviation portion of the building, she would put the tenants in possession of the ground floor of the building instead of the lowest floor of the
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building, i.e., cellar portion of the building. The suit in O.S.No.3304/2000 came to be disposed of in view of the joint memo filed by the parties. As aforementioned, the tenants have taken possession of the suit schedule property on 5.11.1999. It is relevant to note the terms of compromise between the parties in HRC.No.109/1989, which read thus:-
"Whereby the petitioner and the respondents have arrived at the following compromise:
a) the building No.14, Commercial Street, Bangalore, will be demolished land a new structure to be constructed as per the plan, which is annexed to this petition. In the said new construction to be put up, the petitioner will allow the respondents/tenant to occupy the lowest floor having the same dimension as is now in the
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occupation of the
respondents/tenant.
b) The respondents/tenant are
running a retail business. It will be difficult for them to vacate the schedule premises immediately and they will vacate the schedule premises immediately and they will vacate at the end of November 1998. Therefore, the petitioner will carry on the construction work as per the plan to the full satisfaction of the respondents only in respect of the lower ground floor within a period of six months starting from 1st December, 1998. The increase in rents shall be on the existing rents.
c) The respondents are entitled to supervise the construction and inspect the same whenever they desire and will assist the
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petitioner to complete the lower floor within the specified period.
d) The petitioner shall sign all
documents that may become
necessary for obtaining the
fitness certificate supply of
electricity and other civic
amenities from the Corporation
and the other concerned
authorities in the name of the
petitioner and the cost of the
same will be borne by the
petitioner
e) The construction shall be
completed within a period of six
months from the date of
receiving the vacant physical
possession from the respondents.
f) Upon the construction and
occupation of the lowest floor of
the schedule premises, the
respondents/tenants are liable to pay rent of Rs.10,000/- (Rupees ten thousand only) for the first
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eighteen months and from the nineteenth month onwards, a sum of Rs.17,500/- (Rupees seventeen thousand five hundred only) per month as rents to be in vogue for a period of three years, i.e., for a period of eighteen months. After the expiry of first three years from the date of occupation, the rate of rent shall be increased by 15 per cent once in three years as long as the tenancy is in vogue. The rate of rent shall not increase in between.
g) The respondents/tenant shall pay a sum of Rs.1,50,000/- (Rupees one lakh fifty thousand only) towards advance as a security deposit returnable at the time of termination of the said tenancy free of any interest.
h) The respondents/tenant will be entitled to the benefits for the
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long term tenancy of thirty years without any effect and saved from change in title in respect of the schedule property as long as the respondents/tenant do not commit an act of default.
j) The respondents/tenant shall not sub-lease or carry on any prohibited or illegal trade in the schedule premises at any time during the subsistence of the tenancy.
k) The new construction to be put up in the schedule premises by the petitioner to be at par with Royal Tailoring, No.12, Commercial Street, Bangalore, adjoining the petition schedule premises
l) The parties agree that the construction shall be put up by the petitioner before the completion of six months from the date of handing over the actual physical vacant possession by the
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respondents of the petition schedule premises to the
petitioner. If the petitioner fails to complete the construction within a period of six months as stated supra, the respondents will have a right to enter the lower floor and complete the construction at their own cost and transfer the amount to the account of the petitioner to be adjusted against the advance amount and further rents as the case may be, taking into consideration the cost of construction.
m) The parties mutually agree to pay damages to each other in the event either parties commits breach of the aforesaid terms of the compromise petition and the amount is quantified at the rate of Rs.1 lakh per month, as the parties have decided as time is the essence of this compromise.
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n) Any or all the litigations between the petitioner and any third party have to be resolved by the petitioner, pertaining to the schedule property. If there is any delay in construction to any lis as stated above, the petitioner undertakes to compensate the respondents/tenant.
Schedule
All the piece and parcel of the
premises bearing Old No.172, New
No.14, Commercial Street, Bangalore- 560 001, measuring 750 square feet, bounded on:
East by: Door No.173, Tenanted by Allwyn West by: Private Property North by: Commercial Street South by: Private property "
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14. Point No.1: The Clause (h) of the compromise petition filed in HRC.No.109/1989 reads thus:-
"h) the respondents/tenants will be entitled to the benefits for the long term tenancy of thirty years without any effect and saved from change in title in respect of the schedule property as long as the respondents/tenants do not commit an act of default."
Clause (h) of the compromise petition clearly discloses that the tenants will be entitled to the benefits for the long term tenancy of 30 years as long as they do not commit an act of default, meaning thereby, if the tenants commit any act of default, they are not entitled to the benefit of long term tenancy of 30 years. On the other hand, if the tenants do not commit any default of the terms of the compromise, they are entitled to continue as lessees of the suit schedule property for a period of 30 years. Thus, it is
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clear that the continuation of possession of the tenants over the suit schedule property depends upon performance of the obligation imposed on them in the compromise petition the tenants themselves, inasmuch as they should not commit any default in payment of rent during the interregnum.
15. It is argued on behalf of the tenants that the tenants have not committed any default, inasmuch as they were not given the ground floor of the newly constructed building on lease, but were given cellar portion contrary to the terms of the compromise. In other words, it is the contention of the tenants that since the landlord herself had committed default in not providing appropriate floor, i.e., the ground floor on lease in favour of the tenants, the tenants were constrained to withhold rents, inasmuch as the tenancy had not started in accordance with law as on that date.
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Such a submission cannot be accepted. As could be seen from Clause (a) of the compromise petition, it is clear that after new construction is put up, the landlord will allow the tenants to occupy the lowest floor having the same dimension. The said clause nowhere reveals that the landlord should provide ground floor to the tenants. On the other hand, the terms of compromise clearly indicate that the lowest floor of the building shall be provided to the tenants. In the matter on hand, admittedly the lowest floor is the cellar floor. Hence, the cellar floor was leased in favour of the tenants/respondents herein. Thus, there is no breach of conditions of compromise order by the landlord.
Clause(k) of the compromise petition reveals that the new construction of the building should be on par with M/s.Royal Tailoring Firm, situated at No.12, Commercial Street, Bangalore, which is near to the suit schedule property. According to the tenants, the
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suit schedule premises is 1½ feet below ground as compared to M/s.Royal Tailoring Firm and therefore, the premises in question cannot be treated on par with M/s.Royal Tailoring Firm. Merely because the suit schedule property is situated just 1½ feet below ground as compared to M/s.Royal Tailoring Firm, it cannot be said that there is a breach of conditions on the part of the landlord. The fact remains that the suit schedule premises is almost having the same dimension as that of the premises which was occupied by the tenants prior to their occupation and is almost on par with M/s.Royal Tailoring Firm. Undisputedly, the tenants have occupied the newly constructed suit premises as per compromise orders in HRC.No.109/1989 and O.S.No.3304/2000. After occupying the premises, they have failed to pay the rents. Only to cover up their lapses, the tenants are taking up such pleas.
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16. In our considered opinion, the Trial Court is not justified in granting the decree in favour of the tenants directing the landlord to execute registered lease deed for a period of 30 years in favour of the tenants. As could be seen from Clause (h) of the compromise order, the same nowhere makes mandatory on the part of the landlord to execute the registered lease deed in favour of the tenants afresh. On the other hand, it merely says that the tenants are entitled to the benefits of long term tenancy, i.e., for 30 years in case they do not commit an act of default.
17. Sri Shanmukhappa, learned advocate appearing for the tenants submits that the lease for a period of 30 years needs to be compulsorily registered under Section 17(d) of the Registration Act, 1908; since the lease in question is more than one year, the same needs to be registered.
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The said submission cannot be accepted under the facts and circumstances of this case. We say so because under the compromise, parties did not have any intention to create fresh lease among themselves. On the other hand, they intended to continue the existing lease under new terms. Virtually it is a case of re-entry by the tenants of the suit premises under fresh terms. If the terms of compromise operate as a fresh transfer, then lease requires a registered deed for its enforcement. In the matter hand, there is no creation of lease afresh, more over, the terms of compromise make it clear that the landlord will allow the tenants to be in possession of the lowest floor of the newly constructed building, on enhanced rents. Hence, the same does not require registration.
18. We have carefully gone through the compromise order in that regard. Even though the compromise order of the Court in HRC proceedings embodied the agreement between the parties, we do
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not think that the agreement between the parties in HRC proceedings involved any recognition of transfer which requires registration. The compromise decree/order of compromise in HRC.No.109/1989 nowhere mandates that the parties should execute a deed for creation of lease afresh for a period of 30 years. On the other hand, the agreement clearly reveals that the tenants will be entitled to the benefits of long term tenancy for a period of 30 years as long as the tenants do not commit an act of default. HRC.No.109/1989 earlier filed by the landlord was compromised with a specific understanding that the building should be demolished and new construction should be put up by the landlord and thereafter the tenants should be provided with an equal area of the premises for running their business. The compromise terms clearly reveal that it is not a creation of fresh lease, but it is reiteration of earlier lease, of course on different terms. It is the dominant intention of the
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compromise terms which must guide the construction of its contents. The dominant intention of the parties in the matter on hand appears to be that the tenants should be put back in possession of the premises of an equal area on new terms like enhanced rents, etc. In this context, it is relevant to note the observations made by the Apex Court in the case of Girdharilal (dead) by L.Rs. vs. Hukam Singh & others, reported in AIR 1977 SC 129, which read thus:-
"As regards the objection that the terms of the compromise operated as a transfer which required a registered deed for its enforcement, the High Court found that it was a sufficient answer to it that the terms were embodied in a compromise decree. The terms of the compromise did not provide for the execution of any deed of transfer. We were taken through the compromise decree by learned counsel for the appellant. Even though the decree of a Court embodies an agreement between the parties, we do not think that the
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agreement between the parties placed before us, involving the recognition of a transfer, could require registration unless the terms of the compromise decree necessarily involved the execution of a deed of conveyance also. We, therefore, reject this ground of objection also pressed before us vehemently for acceptance by learned counsel for the appellant."
(emphasis supplied) It is also relevant to note the observations of the Apex Court in the case of Smt.Nai Bahu vs. Lala Ramnarayan & others, reported in AIR 1978 SC 22, which are as under:-
"The question would turn on the terms of the compromise. After a careful consideration of the terms of the compromise and the whole tenor of the compromise petition it is absolutely clear that there was no intention to create a lease between the parties. It is the
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dominant intention of the document which must guide the construction of its contents. In the recitals of the compromise petition in three places it is stated categorically that "the plaintiff shall be entitled to execute her decree against the defendants". There was, therefore no intention to create a lease with regard to any portion of the property although certain arrangements had been entered for the intermediate occupation of a certain portion before vacating that portion after expiry of five years. The few alterations and improvements agreed upon by consent were merely an arrangement for vacating two floors and in order to vacate the remaining portion after using it for five years. There was no intention whatsoever to create a new lease. There is, therefore no question of registration of the decree. The submission is devoid of substance. The High Court is, therefore, clearly wrong in holding that a lease was created by the compromise and that the
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decree was ineffective on account of non- registration."
(emphasis supplied)
19. The aforementioned observations of the Apex Court are squarely applicable to the facts of this case, inasmuch as the facts on hand are similar to the facts contained in the matters wherein the aforementioned observations were made by the Apex Court. In view of the same, we are of the clear opinion that neither the compromise decree passed in HRC.No.109/1989 requires registration nor the landlord was required to execute the registered lease deed in favour of the tenants.
Point No.1 is answered accordingly.
20. Point No.2: Under Clause (m) of the terms of compromise, parties have to pay damages in the event of breach of the terms of compromise and amount was quantified at Rs.1,00,000/- per month to
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the other party. Thus, it is clear that if any of the parties commits default or breach of the terms of compromise, he/she is liable to pay damages of Rs.1,00,000/- per month. Under the compromise itself, even the damages are quantified. In the matter on hand, though the compromise petition was filed in HRC.No.109/1989 on 20.2.1998 and though HRC.No.109/1989 was disposed of on 19.3.1998, by virtue of the compromise order based on compromise petition, which required the tenants to vacate the suit premises on or before 30.11.1998, the tenants did not choose to vacate the suit premises earlier occupied by them as per the terms of compromise petition. Therefore, the landlord was compelled to file Execution Petition No.3843/1998 on 28.5.1998, which was contested by the tenants. The applications filed by the tenants in the said execution petition came to be dismissed and consequently delivery warrant was issued to take possession of the suit premises.
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Ultimately, the landlord took possession of the schedule premises from the tenants only on 12.4.1999 and thereafter she reconstructed the building. This is the first stage, wherein the tenants had committed breach of terms of compromise.
21. The tenants occupied the newly constructed premises on 5.11.1999 by paying advance sum of Rs.1,50,000/-, which means that the landlord handed over possession of the suit schedule property almost within six months (precisely within six months and 23 days) from the date she taking possession of the old building for the purpose of demolition and for reconstruction. Thus, it is clear that the landlord has virtually complied with the terms of compromise by handing over the suit schedule property within six months from the date of tenants vacating the old premises. Though the tenants were required to pay rents w.e.f. 5.11.1999, they did not choose to pay the rents regularly. On the other hand, they became
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defaulters. Though the tenants undertook to pay the rents and electricity charges in respect of the schedule premises, they neither paid the rents nor the electric charges. Absolutely no reasons were forthcoming from the tenants to withhold rents. Since the tenants were due in arrears of rents from 5.11.1999 in respect of the suit schedule property, a notice of termination was issued as per Ex.P5 by the landlord on 22.4.2000. Even then, the rents were not paid by the tenants. After determination of tenancy as aforementioned, suit came to be filed on 25.8.2000 by the landlord in O.S.No.5765/2000 and also for recovery of a sum of Rs.90,000/- as arrears of rents from 5.11.1999 apart from future damages.
22. The only defence of the tenants was that the landlord should have provided ground floor of the newly constructed building and not the cellar of the building and on that ground they have withheld the rents.
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The said submission is already answered by us in the preceding paragraphs. Since there was no obligation on the part of the landlord to provide ground floor to the tenants under the compromise decree and as the tenants were required to provide lowest floor of the building, they were provided the lowest floor, i.e., cellar. In the said premises, undisputedly the tenants are running their business from the date of they taking possession of the suit premises. The non-payment of rents till determination of lease and till filing of suit is the second lapse on the part of the tenants.
23. It is relevant to note here itself that one more compromise took place between the parties in O.S.No.3304/2000 which was filed by the tenants for permanent injunction restraining the landlord from letting out/leasing out the suit premises in favour of the third parties. In the said suit, a joint memo was
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filed by the parties and the landlord undertook that in case the Corporation Authorities refuse to regularize the alleged construction/deviation made by the landlord, she would put the tenants in possession of the ground floor. Based on such compromise the said suit, i.e., O.S.No.3304/2000 came to be disposed of. Thus, it is clear that the tenants agreed to occupy the lowest floor, i.e., cellar of the newly constructed building even in O.S.No.3304/2000. Only, in case, if the Corporation were to decline to regularize the construction of the cellar portion of the building, it was incumbent on the landlord to provide ground floor to the tenants. There is nothing on record to show that the lowest portion, i.e., cellar of the building is not regularized by the Corporation Authorities or that the construction is made in violation or deviation of sanctioned plan.
24. It is well settled that the judgment by consent is as effective an estoppel between the parties
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as a judgment whereby Court exercises its mind on a contested case. The truth is, a judgment by consent is intended to put a stop to litigation between the parties just as much as is a judgment which results from the decision of the Court after the matter has been fought out to the end. Therefore, the judgment by consent is as effective an estoppel between the parties as a judgment whereby the Court exercises its mind on a contested case. The Court's attempt should be to give life and enforceability to the compromise award and not to defeat it on technical grounds. {See the judgment in the case of P.T.Thomas vs. Thomas Job - (2005)6 SCC 478}.
25. The tenants have occupied the lowest floor of the building in terms of the compromise entered into between the parties in HRC.No.109/1989 as well as in O.S.No.3304/2000 and therefore, in order to overcome their lapses in not paying the rents, it is not open for the tenants to contend that they should have
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been provided the ground floor and not the lowest floor. They are estopped from contending so. In this view of the mater, the tenants are liable to pay damages as prayed for by the landlord.
Point No.2 is answered accordingly.
26. Point No.3: From the aforementioned discussion, it is amply clear that the tenants have committed breach of the terms of the compromise. They became defaulters in paying the rents.
27. Sri Shanmukhappa, learned advocate appearing for the tenants submits that in case of any default on the part of the tenants or in case of any breach of terms of compromise on the part of either of the parties, the damages may have to be imposed as per Clause(m) of the terms of the compromise in terms of HRC.No.109/1989 and the order of ejectment cannot be granted.
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Such a submission cannot be accepted. The terms of compromise will have to be read in their entirety. One of the terms cannot be read in isolation. If one reads entire terms of the compromise, the same would make clear the dominant intention of the parties. The dominant intention of the parties is to demolish and reconstruct the building and to allow the tenants in the lowest floor of the newly constructed building on enhanced rents and advance. The lease shall be for a long period of 30 years in case if the tenants do not commit an act of default, meaning thereby that if the tenants commit any default within the period of 30 years, they are liable to be evicted. By any stretch of imagination, it cannot be held that there is no termination of tenancy even if the tenants commit default on their part. On the other hand if the tenants commit any default on their part, apart from paying rents they are liable to pay damages, including the rents. Since the tenants have committed default
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on their part in not paying rents regularly, in our considered opinion, the Trial Court is not justified in dismissing the suit of the land for ejectment.
28. At this stage, it is relevant to note that though the tenants had occupied the newly built premises as aforementioned on 5.11.1999, they remained defaulters, till the year 2005. An application came to be filed by the landlord praying for direction to the tenants for payment of arrears of rents. It appears, the said application came to be rejected by the Trial Court. As against the said order passed on the interim application filed by the landlord, she filed WP.No.15385/2005 c/w.WP.No.15386/2005 before this Court, which came to be disposed of on 22.6.2005 with the following observations:-
"For the reasons stated above, the writ petition Nos.15386/2005 and 15385/2005 are allowed. The impugned orders passed at Annexure-R
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and Annexure-P in WP.Nos.15836/2005 and 15385/2005 respectively are set aside. The rent which is quantified in the application is from November 1999 to April 2001 which would work out to Rs.3,72,500/-. The respondents/ tenants shall deposit the said rent of Rs.3,72,500/- within a period of eight weeks from today. In so far as remaining rent is concerned, the petitioner/landlady shall file a memo of calculation in the trial Court and the learned trial Judge shall pass appropriate orders accordingly."
(emphasis supplied) From the aforementioned order, it is clear that as on 22.6.2005, the tenants were due in a sum of Rs.3,72,500/-. The tenants were directed to deposit the aforementioned arrears of rents. Questioning the order of this Court passed in WP.No.15385/2005 c/w. WP.No.15386/2005, the tenants had approached the Apex Court in SLP.No.17424/2005, which came to be
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dismissed by the Apex Court. Thus, it is amply clear that the tenants have been making defaults in paying rents and hence they are liable to be evicted. Thus, in our considered opinion, the suit filed by the landlord for ejectment is entitled to be decreed.
Accordingly, the following order is made:-
A) RFA.686/2006** is partly allowed in the following terms:-
i) O.S.No.5765/2000 filed by the landlord for ejectment of the tenants from the suit schedule property is decreed.
ii) The tenants shall hand over vacant possession of the suit schedule property in favour of the landlord within six months from today.
iii) The tenants are directed to pay damages at the rate of Rs.10,000/- per month (Rupees ten thousand only) from the date of the suit, i.e., 25.8.2000 till ** Correction carried out vide chamber order dated 20.09.2013
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handing over the vacant possession of the suit schedule property in favour of the landlord.
iv) The tenants shall also pay the rents regularly as agreed in the compromise order passed in HRC.No.109/1989 till the date of handing over the possession of the suit schedule property to the landlord.
v) The decree passed by the Trial Court directing the tenants to pay a sum of Rs.90,000/- as arrears of rents to the landlord is confirmed. However, the tenants-respondents herein shall pay interest at the rate of 10% per annum on the said amount.
B) RFA.No.800/2006** is allowed in the following terms:-
i) The judgment and decree passed by the Trial Court in O.S.No.5979/2000 directing the landlord-appellant herein to execute the registered lease deed ** Correction carried out vide chamber order dated 20.09.2013
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for a period of 30 years in favour of the tenants is set aside.
ii) In view of the aforementioned order at B(i), ancillary reliefs granted in favour of the tenants by the Trial Court are also set aside.
iii) However, the ancillary reliefs relating to user of existing toilet facility would continue till the tenants vacate the schedule premises within the time granted or till they are evicted in accordance with law by executing the decree.
iv) The judgment and decree passed by the Trial Court in O.S.No.5979/2000 is modified accordingly.
Sd/-
JUDGE Sd/-
JUDGE *ck/-