Delhi District Court
Ms. Natascha Chadha vs M/S Yograj Infrastructure Ltd. (Yil) on 19 October, 2022
IN THE COURT OF MR. SATYABRATA PANDA, ADJ-04,
PATIALA HOUSE COURTS, NEW DELHI
CS NO.59274 OF 2016
Date of institution: 23.02.2011
Date of arguments: 30.08.2022
Date of judgment: 19.10.2022
1. Ms. Natascha Chadha
d/o Mr. Kul Rattan Chadha
r/o Buurweg 11, 2244-AA, Wassenaar, Netherland
through her Power of Attorney
Mr. S.C Varma s/o Late Sh. D.D Ram Varma
r/o 32, Dera Mandi Road, Tehsil-Mehrauli,
New Delhi-110030
2. Mr. Robin Chadha
s/o Mr. Kul Rattan Chadha
r/o Buurweg 11, 2244-AA, Wassenaar, Netherland
through her Power of Attorney
Mr. S.C Varma s/o Late Sh. D.D Ram Varma
r/o 32, Dera Mandi Road, Tehsil-Mehrauli,
New Delhi-110030
3. Mrs. Sushma Varma
w/o Mr. S.C Varma
r/o 32, Dera Mandi Road, Tehsil-Mehrauli,
New Delhi-110030
4. Mr. S.C Varma Karta of
Mr. S.C Varma (HUF) s/o Late Sh. D.D Ram Varma
r/o 32, Dera Mandi Road, Tehsil-Mehrauli,
New Delhi-110030 ...........Plaintiffs
VERSUS
M/s Yograj Infrastructure Ltd. (YIL)
Corporte office at : B-63, Paschimi Marg,
Vasant Vihar, New Delhi 110057 ........Defendant
CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 1/35
JUDGMENT
1. The present suit has been instituted by the plaintiffs against the defendant for decree of sum of ₹ 20,07,600/- along with pendente lite and future interest.
PLAINT
2. The case of the plaintiffs as pleaded in the plaint is as follows: The plaintiffs gave the property bearing no. 63-D, Basant Lok, Vasant Vihar, New Delhi 110057 comprising of mezzanine, first and second floor with terrace area measuring 4100 sq.ft. (hereinafter referred to as the suit property) on lease to the defendant company vide lease deed dated 31.10.2009 registered in the office of the Sub- Registrar, New Delhi on 31/10/2009, on rent of ₹ 5,25,000/- per month which was payable quarterly. The lease deed had a lock-in period of 3 years. After the lock in period, the lease could be terminated by giving 3 months' advance written notice and the lease was renewable for another three years on enhancement of monthly rent by 12 per cent. The rent was payable quarterly in advance and the defendant deposited a sum of ₹ 15,75,000/- towards the security deposit and also paid rent for the first quarter. The defendant after some time wanted to vacate the property and asked the plaintiffs orally as also by letter dated 14/05/2010 to look for another tenant. The defendant got the security deposit adjusted in the rent. The defendant instead of paying the amount of rent for the lock in period of 3 years requested the plaintiffs first orally and then by letter dated 14/05/2010 to look for another tenant CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 2/35 and agreed that the defendant would make the following payments: a) The monthly rent till the premises remained vacant, b) The expenses for looking for another tenant i.e. one month brokerage for the property dealer who would look for the new tenant, and c) that the defendant shall pay the service tax for all the months of their occupation of the premises till the new tenant came. In supersession of the lease deed, the aforesaid proposals of the defendant were accepted by the plaintiffs and they engaged a property dealer who found a new tenant in June 2010 by paying the same rate of rent as was being paid by the defendant and their tenancy was to start from 01/07/2010. The defendant got adjusted the security deposit against the rent up to April 2010. The property remained vacant for 2 months for which monthly rent payment was to be paid by the defendant in terms of the settlement. One month's rent was also payable as commission/brokerage to the property dealer towards the new tenant for which the defendant was liable in terms of the settlement. Thus, the defendants were liable to pay ₹ 15,75,000 to the plaintiffs. The defendant had agreed to pay service tax on the rent amount which was 10.30% of the rent and hence the defendant was liable to pay service tax on the rent amount for 8 months amounting to ₹ 4,32,600/- to the plaintiffs. Thus, the defendant was liable to pay a total sum of ₹ 20,07,600/- to the plaintiffs. The plaintiffs asked the defendant for payment of the aforesaid amounts several times and sent an email reminding the defendant of the payment to be CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 3/35 made to the plaintiff. The defendant informed the plaintiffs that it confirmed the payment and that Mr. Yogendra Singh, the defendant's managing director, was out of station and that the pay order would be issued in favour of the plaintiffs on his return, but in spite of several reminders, no payment was received by the plaintiffs from the defendant. Thus, the plaintiffs served the defendant with notice dated 22/11/2010 asking the defendant to make the payment of the amount failing which the defendant would be liable for interest at the rate of 18% per annum. The defendant did not respond to the notice. Hence, the present suit has been filed.
3. On this basis, the plaintiff has sought the following reliefs in the prayer clause of the plaint:
"It is, therefore, respectfully prayed that the Hon'ble Court may be pleased to pass a decree for a sum of Rs. 20,07,600/- (Rupees twenty thousand (sic) seven thousand and six hundred only) in favour of the Plaintiffs and against the Defendant with costs and with interest at the rate of 18 per cent per annum pendente-lite and future till the payment or recovery of the decretal amount. The Hon'ble Court may be pleased to grant such other and further relief to the Plaintiffs as may be found just and proper under the circumstances of the case."
WRITTEN STATEMENT CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 4/35
4. The case of the defendant as pleaded in the written statement is as follows: The registered lease deed between the parties is admitted. When the lease deed was executed, it was assured by the plaintiff that the treatment for seepage would be done by the plaintiff at their own cost and to the satisfaction of the defendant. The plaintiff failed to fulfil its promise of treatment of the seepage despite various requests. Because of the failure of the plaintiff to treat the seepage, the defendant was unable to set up its office at the leased premises. Due to the seepage in the leased property, the records in the form of documents and other assets of the defendant would have been affected badly. Since the requests of the defendant to the plaintiff to get the seepage treated fell on deaf ears, it was for this reason that the defendant during the initial one-month expressed its intention to rescind the lease deed and requested the plaintiff to return the security deposit along with the advance rent of two months. However, the plaintiff refused to return the security deposit and the advance rent, and also paid no heed to the requests of the defendant for getting the premises repaired. It was at this juncture that it was mutually agreed between the parties that the parties would rescind the lease deed with effect from 30/04/2010. It was also agreed between the parties that the security deposit would be adjusted by the plaintiffs towards the rent for 3 months, and, thereafter, the defendant would not be liable for anything else and the CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 5/35 plaintiffs were free to look for another tenant for the property. The defendant on the request of the plaintiffs issued letter dated 14/05/2010 to the plaintiffs confirming that the lease deed was rescinded and that the plaintiffs were free to arrange for another tenant. The said letter was issued by the defendant to the plaintiffs without mentioning about the seepage as the plaintiffs wanted this letter to induct the new tenant who was to shift in the property on 16/05/2010 according to the plaintiffs. The liability to pay monthly rent till the property remained vacant, or for commission/brokerage of the property broker, or for service tax for all the months of occupation is denied by the defendant. The oral agreement alleged by the plaintiff in the plaint is denied by the defendant. It is admitted that the defendant got the payment of rent adjusted from the security deposit of rent upto April 2010. The defendant has denied any liability as claimed by the plaintiff in the plaint. It is denied that the plaintiff ever sent an email reminding the defendant of the payment to be made to the plaintiff. The email dated 07/06/2010 referred to in the plaint is denied. The legal notice sent by plaintiff is denied.
REPLICATION
5. The stand of the plaintiffs in the replication is summarised as follows: The allegations regarding the seepage were false. The letter dated 14/05/2010 from the defendant to the plaintiffs clearly states that the defendant was not in CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 6/35 position to continue with the lease for personal reasons and not due to any fault on the part of the plaintiffs. The version of the defendant about seepage is a cooked-up story. The defendant had inspected the premises and had thereafter executed the lease deed. The defendant had never raised any question of seepage or repair before filing the written statement. The new tenant wanted the distempering et cetera of the premises over again and the defendant agreed to pay the service tax instead of the amount spent by the plaintiff on the premises after being vacated by them.
ISSUES
6. Vide Order dated 12/08/2011, the following issues were framed in the suit:
1. Whether the suit has been overvalued for the purpose of Court fees and jurisdiction as alleged in the Written statement? OPD
2. Whether there was seepage in the suit property and consequently, the suit property never came to be occupied by the defendants as alleged in the Written statement? OPD
3. Whether it was agreed between the parties that the lease agreement would be rescinded w.e.f.
30th April, 2010 and rent for three months and security equivalent to three months' rent would be adjusted by the plaintiff, as alleged in the Written Statement? OPD
4. Relief CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 7/35
7. Vide Order dated 03/10/2011, the following additional issue was framed in the suit:
1. Whether the defendant is liable to pay service tax claimed by the plaintiff? OPP
2. Whether the defendant had agreed to pay one month's rent as brokerage as alleged in the plaint? OPP
8. Vide Order dated 07/04/2022, the following additional issue was framed in the suit:
1. Whether the plaintiff is entitled for rental for the period May-June 2010 to the tune of Rs.
10,50,000/- in terms of alleged oral agreement? OPP PLAINTIFF'S EVIDENCE:
9. In support of their case, the plaintiffs have examined PW-1 Mr. S.C. Varma, who is the Plaintiff No.4. PW-1 has tendered his affidavit in evidence Ex.PW-1/A in which he has deposed along the lines of the plaint and has reiterated the contents of the plaint. The plaintiffs have also examined PW-2 Mr. R.C. Kaushik, who is the manager in the office of PW-1. PW-2 has tendered his affidavit in evidence Ex.PW-2/A in which he has deposed regarding the plaintiff's version of the oral agreement.
10. In support of their case, the plaintiffs have relied upon the following documents:
i) Ex.PW-1/1 General Power of Attorney by the plaintiff no. 1
ii) Ex.PW-1/2 General power of attorney of plaintiff 2 CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 8/35
iii) Ex.P-1 Registered lease deed dated 30/10/2009
iv) Ex.P-2 Letter dated 14/05/2010 from the defendant
v) Ex.PW-1/7 Email dated 07/06/2010 (The learned counsel for defendant had objected to the mode of proof and admissibility of the said document at the time of recording of evidence on 16/01/2012 and the objections were kept open)
vi) Ex.PW-1/3 Notice dated 22/10/2010
vii) Ex.PW-1/5 Speed post receipt dated 23/11/2010
viii) Ex.PW-1/6 Postal receipt Acknowledgement card DEFENDANT'S EVIDENCE
11. In support of its case, the defendant has examined DW-1 Mr. Yogendra Singh, who is director in the defendant company. DW-1 has tendered his affidavit in evidence Ex.DW-1/A in which DW-1 has deposed along the lines of the written statement.
12. In support of its case, the defendant has relied upon the following documents: Ex.PW-1/D-1 Lease deed dated 01/06/2010 between the plaintiffs and the new tenant (this document was confronted to the plaintiffs' witness during cross-examination).
DISCUSSION & FINDINGS CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 9/35
13. I have heard the learned counsel for both the parties and I have perused the record.
14. My issue-wise findings are as follows.
Issue 1: Whether the suit has been overvalued for the purpose of Court fees and jurisdiction as alleged in the Written statement? OPD
15. The onus to prove this issue was upon the defendant. No arguments were addressed by the learned counsel for the Defendant on this issue. It is submitted in the written arguments filed by the defendant that this issue has lost relevance pursuant to the variation in pecuniary jurisdiction of the Hon'ble High Court and the District Courts and the transfer of the suit to the District Court from the Hon'ble High Court. As a result, I would hold that the defendant has given up its challenge to the suit on the basis of overvaluation for the purposes of court fees and jurisdiction. Accordingly, Issue 1 is answered against the defendant and in favour of the plaintiff.
Issue 2: Whether there was seepage in the suit property and consequently, the suit property never came to be occupied by the defendants as alleged in the Written statement? OPD
16. The onus to prove this issue was upon the defendant. Upon an analysis of the evidence, I would hold that the defendant has failed to prove this issue.
CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 10/35
17. In paragraph 2 of the written statement, it is stated by the defendant as follows: "However when the lease deed was executed it was assured by the plaintiff that the treatment for the seepage will be done by the plaintiff at its own cost and to the satisfaction of the defendant. It is further submitted that despite several requests, the plaintiff failed to fulfil its promises of getting the treatment of seepage". From this paragraph of the written statement, it is clear that the defendant has pleaded that there was seepage at the time when the lease deed was executed and that it was assured by the plaintiff that the treatment for the seepage would be done by the plaintiff at its own cost and to the satisfaction of the defendant. However, it is seen that the lease deed dated 30/10/2009 Ex.P-1 is completely silent on this point. If there was seepage at the time when the lease deed was executed and it was assured by the plaintiff that the treatment for the seepage would be done by the plaintiff at its own cost and to the satisfaction of the defendant, then it is not believable that the parties would not have covered this point in the lease deed. The lease deed was to be for a period of 3 years and with the lock in period of 3 years. The amount of rent was ₹ 5,25,000 payable on quarterly basis and was not a small amount. In case a prospective tenant observes seepage during inspection prior to the lease, such prospective tenant would normally ensure that the seepage is treated before entering into the lease. Further, even if such prospective tenant were to go by the assurance of the prospective lessor that CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 11/35 the seepage would be treated, even in such case any reasonable person would have ensured that the fact of seepage and the assurance that the seepage would be cured by the lessor at his own cost and to the satisfaction of the tenant would have been incorporated in the lease deed. The lease deed is completely silent regarding any seepage being there in the property or that there was any assurance of treatment of seepage by the plaintiff, and hence I am unable to believe that there was any seepage in the property at the time of the lease.
18. During his cross examination on 08/11/2017, the DW-1 was examined as under:
"I inspected the premises before taking it upon rent (vol. there was certain seepage in the building for which the plaintiff said that the same would be rectified before giving the property on rent.) Que: why did you take the premises on rent if the defects were not rectified as per your satisfaction? Ans: We took the premises on rent on the assurance of the plaintiff that the seepage will be cured. Que: Can you show any communication from the record complaining about the seepage or demanding rectification thereof? Ans: It was informed to the plaintiff verbally many times but, the same was not rectified and therefore, I did not start my office there even for one day."
19. Again, it is to be noticed that the DW-1 stated in cross examination that the property was inspected before taking it upon rent and there was certain seepage in the building at the time for which the plaintiff had said that the same would be rectified before giving the property on rent. It is CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 12/35 then stated by DW-1 that the premises were taken on rent on the assurance of the plaintiff that the seepage would be cured. As I have already mentioned, the lease deed is completely silent on this aspect and I find it not believable that any reasonable tenant who has observed seepage in the property would take the property on rent, firstly, without the seepage being treated, and secondly, even if assuming that such property with seepage would be taken on rent, such prospective tenant would fail to have it recorded in the lease deed that there was seepage and that the lessor had assured to treat the seepage.
20. As already mentioned, there is no documentary evidence in the form of communications by the defendant to the plaintiff placed on record that there was seepage in the property. It does not seem reasonable at all that the company which has taken a property on lease on a good amount of rent, would not communicate with the lessor by correspondence be it through letters or by emails, or even in today's date by SMS. Normally, any reasonable tenant would also take photographs of the seepage for proof. Nothing of the sort has been brought forward by the defendant.
21. Even in the written statement, there are no material particulars which are stated as to when the complaints for seepage were made and to whom these complaints were made. There are no particulars as to the date or time when any such complaints were made. All that the defendant has CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 13/35 done in the name of leading evidence for seepage is that DW-1 has given oral evidence that there was seepage and demands for rectification were made. Apart from this there is no evidence which has been given by the defendant for any seepage. Normally, if there was any seepage then even any reasonable tenant would have called some worker or repairman to check whether the seepage can be cured and to what was the extent of the seepage. The defendant has failed to give any evidence that the defendant had called any repairman to even check the extent of the seepage. The evidence of DW-1 that verbal complaints were made does not inspire confidence. DW-1 has not even stated in his affidavit in evidence Ex.DW-1/A as to when these verbal complaints were made, and who made these verbal complaints and to whom were these verbal complaints made. It was incumbent upon the DW-1 to at least give material particulars of any alleged verbal complaints in his affidavit in evidence Ex.DW-1/A.
22. The defendant had issued letter dated 14/05/2010 Ex.P2 being the request for cancellation of the sub-lease deed. The relevant portion of Ex.P2 is extracted hereunder:
"Sub: Request for cancellation of Agreement of Lease of ...........
Dear sir, It is continuation of our talks regarding the agreement executed on 29.10.09, we hereby submit that due to our personal reasons, we are not in a position to continue the lease and we wants to close the same.
CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 14/35 We further submit that you are free to arrange another tenant for the above said property. Thanks & Regards"
23. In this letter dated 14/05/2010 Ex.P2, the defendant has given stated that "due to our personal reasons, we are not in a position to continue the lease and we wants to close the same". Thus, the ground given is "our personal reasons". If it was the case of the defendant that there was seepage in the property and that is why the defendant was vacating the property, then nothing stopped the defendant from stating so. There is no documentary evidence in the form of any communication from the defendant to the plaintiffs complaining of any seepage.
24. During his cross examination on 08/11/2017, the DW-1 was examined as under:
"Attention of the witnesses drawn to his letter dated 14/05/2010 i.e. Ex.P-2.
Que: Why in the said letter there is no mention of any seepage or defect in the said property? Ans: As per the settlement between the parties, plaintiffs had requested me to issue this letter so that they could give the property in question to the new tenant."
25. I am not convinced by the evidence given by the DW-1 that there was no mention of seepage or defect in the letter dated 14/05/2010, only as the plaintiff had requested the defendant to issue the letter dated 14/05/2010. I do not see any reason why the defendant would have not mentioned any seepage or defect in the property in any CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 15/35 communication by the defendant to the plaintiff. Such a version of the defendant could have been believable if in the letter dated 14/05/2010 there was no mention of seepage or defect, but there were other previous letters in which the defendant had a raised the issue of seepage or defect. In such a case, it could have been fathomed that the defendant had raised the issue of seepage or defect, but upon the request of the plaintiff to have a letter so as to have a new tenant, the defendant would have given a letter such as the letter dated 14/05/2010. But this is not the case here. There is no communication whatsoever from the defendant to the plaintiff except for the letter dated 14/05/2010. It is not believable that the defendant did not mention seepage or damage in the property only at the request of the plaintiff.
26. In their list of witnesses, the defendant had mentioned at Sl. No.2 Mr. Ashwinder/Sudhir Lutiyan for the purpose to prove the seepage and damages in the leased property in question. However, this witness was never produced or examined by the defendant. This is another point which would go against the defendant. If the defendant had any witness for the purpose of proving the seepage and damages than the defendant would have produced and examine such witness. Failure to examine a witness which is mentioned in the list of witnesses for the purpose of proving the seepage and damages in the property, would CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 16/35 lead to an adverse inference that had the witness been produced it would have damaged the case of the defendant.
27. The onus to prove Issue 2 was on the defendant. It is held that the defendant has failed to discharge the onus. Accordingly, Issue 2 is answered against the defendant and in favour of the plaintiff.
Issue 3: Whether it was agreed between the parties that the lease agreement would be rescinded w.e.f. 30 th April, 2010 and rent for three months and security equivalent to three months' rent would be adjusted by the plaintiff, as alleged in the Written Statement? OPD Additional Issue 1: Whether the defendant is liable to pay service tax claimed by the plaintiff? OPP Additional Issue 2: Whether the defendant had agreed to pay one month's rent as brokerage as alleged in the plaint? OPP Second Additional Issue 1: Whether the plaintiff is entitled for rental for the period May-June 2010 to the tune of Rs. 10,50,000/- in terms of alleged oral agreement? OPP
28. The afore-quoted issues are taken up together for discussion as these issues relate to the oral agreements alleged by the plaintiffs and defendant, respectively.
29. Both parties rely upon their respective versions of the oral agreements. It is the case of both parties that the lease deed was superseded by the subsequent oral agreement between the parties whereby the lease deed was rescinded. However, where the parties are at variance is as to the terms of the subsequent oral agreement as alleged by each CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 17/35 of them. According to the plaintiffs, as per the subsequent oral agreement between the parties, the lease deed was rescinded on the terms that the defendant was liable to make payment towards monthly rent till the premises remained vacant, towards the brokerage/commission of the property broker for finding the new tenant, and towards service tax on the rent for the period when the defendant remained in the property. On the other hand, it is the case of the defendant that the subsequent oral agreement between the parties was that the lease deed was rescinded on the terms that that the security deposit would be adjusted towards the balance months' rent, and that the defendant was not liable for anything else, and that the plaintiffs were free to induct any other tenant.
30. Now, the question which arises is whether the oral agreements alleged by both parties can be proved in the face of the registered lease deed. Sections 91 and 92 Indian Evidence Act would be relevant in this regard, and the relevant portion thereof is extracted hereunder:
"91. Evidence of terms of contracts, grants and other dispositions of property reduced to form of document. -- When the terms of a contract, or of a grant, or of any other disposition of property, have been reduced to the form of a document, and in all cases in which any matter is required by law to be reduced to the form of a document, no evidence shall be given in proof of the terms of such contract, grant or other disposition of property, or of such matter, except the document itself, or secondary evidence of its contents in cases in which secondary CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 18/35 evidence is admissible under the provisions hereinbefore contained.
... ... ..."
"92. Exclusion of evidence of oral agreement. -- When the terms of any such contract, grant or other disposition of property, or any matter required by law to be reduced to the form of a document, have been proved according to the last section, no evidence of any oral agreement or statement shall be admitted, as between the parties to any such instrument or their representatives in interest, for the purpose of contradicting, varying, adding to, or subtracting from, its terms:
... ... ...
Proviso (4). --The existence of any distinct subsequent oral agreement to rescind or modify any such contract, grant or disposition of property, may be proved, except in cases in which such contract, grant or disposition of property is by law required to be in writing, or has been registered according to the law in force for the time being as to the registration of documents.
... ... ..."
(Emphasis supplied by me)
31. Admittedly, the registered lease deed executed between the parties is for a period of 3 years and compulsorily requires registration under Section 107 Transfer of Property Act, the relevant portion of which is extracted hereunder:
"107. Leases how made.-- A lease of immoveable property from year to year, or for any term exceeding one year, or reserving a yearly rent, can be made only by a registered instrument.
... ... ..."
(Emphasis supplied by me) CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 19/35
32. With respect to the Proviso 4 to Section 92 Indian Evidence Act, the Hon'ble Supreme Court has in S. Saktivel v. M. Venugopal Pillai, (2000) 7 SCC 104, held as under:
"5. Learned counsel appearing for the appellant urged that the view taken by the High Court in decreeing the suit of the plaintiff was erroneous inasmuch as the settlees under Ext. A-1 got the suit property and by the subsequent oral arrangement, they agreed to work out their rights without varying or substituting the terms of Ext. A-1 and, therefore, the High Court was not right in not considering the oral arrangement as pleaded by the defendant- appellant. It is not disputed that disposition under Ext. A-1 in the present case is by way of grant and under the said disposition all the sons of Muthuswamy Pillai acquired rights. It is also not disputed that the settlement deed is a registered document and by virtue of alleged subsequent oral arrangement, the other sons of Muthuswamy Pillai were divested of the rights which they acquired under the settlement deed. Under such circumstances the question that arises for consideration is as to whether any parol evidence can be let in to substantiate subsequent oral arrangement rescinding or modifying the terms of the document which, under law, is required to be in writing or is a registered document, namely, Ext. A-
1. Section 92 of the Evidence Act reads as thus:
"92. Exclusion of evidence of oral agreement.
--When the terms of any such contract, grant or other disposition of property, or any matter required by law to be reduced to the form of a document, have been proved according to the last section, no evidence of any oral agreement or statement shall be admitted, as between the parties to any such instrument or their representatives in interest, for the CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 20/35 purpose of contradicting, varying, adding to, or subtracting from, its terms:
*** Proviso (4).--The existence of any distinct subsequent oral agreement to rescind or modify any such contract, grant or disposition of property, may be proved, except in cases in which such contract, grant or disposition of property is by law required to be in writing, or has been registered according to the law in force for the time being as to the registration of documents."
A perusal of the aforesaid provision shows that what Section 92 provides is that when the terms of any contract, grant or other disposition of property, or any matter required by law to be reduced in the form of a document, have been proved, no evidence of any oral agreement or statement is permissible for the purpose of contradicting, varying, adding or subtracting from the said written document. However this provision is subject to provisos (1) to (6) but we are not concerned with other provisos except proviso (4), which is relevant in the present case. The question then is whether the defendant- appellant can derive any benefit out of proviso (4) to Section 92 for setting up oral arrangement arrived at in the year 1941 which has the effect of modifying the written and registered disposition. Proviso (4) to Section 92 contemplates three situations, whereby:
(i) The existence of any distinct subsequent oral agreement to rescind or modify any earlier contract, grant or disposition of property can be proved.
(ii) However, this is not permissible where the contract, grant or disposition of property is by law required to be in writing.
(iii) No parol evidence can be let in to substantiate any subsequent oral arrangement which has the effect of CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 21/35 rescinding a contract or disposition of property which is registered according to the law in force for the time being as to the registration of documents.
6. In sum and substance what proviso (4) to Section 92 provides is that where a contract or disposition, not required by law to be in writing, has been arrived at orally then subsequent oral agreement modifying or rescinding the said contract or disposition can be substantiated by parol evidence and such evidence is admissible. Thus if a party has entered into a contract which is not required to be reduced in writing but such a contract has been reduced in writing, or it is oral, in such situations it is always open to the parties to the contract to modify its terms and even substitute by a new oral contract and it can be substantiated by parol evidence. In such kind of cases the oral evidence can be let in to prove that the earlier contract or agreement has been modified or substituted by a new oral agreement. Where under law a contract or disposition is required to be in writing and the same has been reduced to writing, its terms cannot be modified or altered or substituted by oral contract or disposition. No parol evidence will be admissible to substantiate such an oral contract or disposition. A document for its validity or effectiveness is required by law to be in writing and, therefore, no modification or alteration or substitution of such written document is permissible by parol evidence and it is only by another written document the terms of earlier written document can be altered, rescinded or substituted. There is another reason why the defendant-appellant cannot be permitted to let in parol evidence to substantiate the subsequent oral arrangement. The reason being that the settlement deed is a registered document. The second part of proviso (4) to Section 92 does not permit leading of parol evidence for proving a subsequent oral agreement modifying or rescinding CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 22/35 the registered instrument. The terms of registered document can be altered, rescinded or varied only by subsequent registered document and not otherwise. If the oral arrangement as pleaded by the appellant, is allowed to be substantiated by parol evidence, it would mean rewriting of Ext. A-1 and, therefore, no parol evidence is permissible.
7. In view of the aforesaid legal position on interpretation of proviso (4) to Section 92 we have to examine as to whether settlement deed Ext. A-1 was required to be in writing under the law or not. It is not disputed that by settlement deed Ext. A-1, which is a disposition, Muthuswamy Pillai passed on right to property to all his sons, who acquired right in the property. Where there is such conferment of title to the property, law requires it to be in writing for its efficacy and effectiveness. A document becomes effective by reason of the fact that it is in writing. Once under law a document is required to be in writing, parties to such a document cannot be permitted to let in parol evidence to substantiate any subsequent arrangement which has effect of modifying earlier written document. If such parol evidence is permitted it would divest the rights of other parties to the written document. We are, therefore, of the view that the subsequent oral arrangement set up by the defendant-appellant cannot be proved by the parol evidence. Such an evidence is not admissible in evidence."
(Emphasis supplied by me)
33. The subsequent oral agreement which is pleaded by the plaintiff purports to rescind the registered lease deed. Similarly, the subsequent oral agreement which is pleaded by the defendant also purports to rescind the registered lease deed. The registered lease deed between the parties is for a period of 3 years and compulsorily requires CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 23/35 registration. Hence, in my view, under Proviso 4 to Section 92 Indian Evidence Act, both the plaintiff as well as the defendant would be barred from proving the terms of the respective subsequent oral agreements claimed by them. In the result, the evidence led by both the parties in order to prove the terms of the respective subsequent oral agreements relied upon by either of them would be inadmissible in evidence.
34. The learned counsel for the plaintiff has argued that in the present case there would be no bar to proving the subsequent oral agreement under section 92 Proviso (4) Indian Evidence Act since both the parties have admitted that the registered lease deed was modified/rescinded by an oral arrangement. I do not see any merit in this argument since although both parties agree that the registered lease deed was modified/rescinded by an oral arrangement, both parties have their respective versions of the oral agreement which are at odds regarding the terms of the oral arrangement. Hence, it cannot be said that in the present case the parties are ad idem on the terms of the subsequent oral agreement modifying/rescinding the registered lease deed.
35. The learned counsel for defendant had submitted that in case the respective subsequent oral agreements set up by the parties are held to be excluded, then the suit of the plaintiff is liable to be dismissed as the case of the plaintiff is based on the subsequent oral agreement only. However, CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 24/35 I would not agree with this submission. Once the oral agreement is held to be excluded, the Court would proceed to determine the question of liability of the defendant on the basis of the facts which have clearly come out from the evidence on the record, namely that the defendant vacated the premises only in May 2010 and that the new tenant entered into possession from 01/06/2010 onwards. Ex.P-2 is the letter dated 14/05/2010 from the defendant to the plaintiff requesting for cancellation of the lease deed. PW- 2 has deposed in cross-examination that the defendant vacated the premises in May 2010 after the letter dated 14/05/2010. Ex.PW-1/D-1 is the certified copy of the registered lease deed dated 01/06/2010 between the plaintiffs and the new tenant M/s. Arham IT Infrastructure Pvt. Ltd. in respect of the suit property. Clause 5 of Ex.PW-1/D-1 records that the lessors have handed over the vacant and peaceful possession of the demised premises to the lessee on 01/06/2010. Hence, from the evidence it has come out that the defendant vacated the premises in May 2010 and the new tenant entered into possession w.e.f. 01/06/2010. Hence, the defendant would be liable to make payment of the rent under the Ex.P-1 for the period till 31/05/2010. Admittedly, the rent up to April 2010 has been paid by the defendant upon adjustment of the security deposit. Hence, the balance rent is only for the month of May 2010 till 31/05/2010 which would be payable by the defendant to the plaintiff.
CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 25/35
36. In the aforesaid paragraphs I have proceeded on the basis that the evidence of the subsequent oral agreements would not be admissible in evidence in light of Proviso 4 to Section 92 of the Evidence Act. However, since the learned counsel for both the parties have argued that the bar under Proviso 4 to Section 92 Evidence Act would not be applicable since both parties are relying upon oral agreements, I have also proceeded to consider the evidence of the oral agreements as well on the assumption that the bar would not apply. Now, assuming that the evidence led by the parties in respect of the respective oral agreements set up by them was admissible as argued by learned counsel for both parties, even then, on a perusal of the evidence, my conclusion would remain the same that it would only be the rent only for the month of May 2010 till 31/05/2010 which would be payable by the defendant to the plaintiff. My reasons are as follows.
37. In so far as the oral agreement alleged by the plaintiff is concerned, as per the case of the plaintiff the oral agreement to rescind the registered lease deed was on the terms that the defendant would pay the following: a) the monthly rent till the premises remained vacant, b) one month brokerage for the property dealer, and c) service tax for all the months of the occupation by the defendant.
38. First, I shall deal with the claim of the plaintiffs regarding payment of service tax. In their replication, in paragraph 5, the plaintiffs have averred that the new tenant wanted CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 26/35 distempering etc. of the premises over again and that the defendant had agreed to pay the service tax instead of the amount spent by the plaintiff on the premises after being vacated by them. However, in his cross-examination, PW-1 has stated that the oral agreement to pay service tax was prior to the induction of the tenant. PW-1 has also stated in his cross-examination that he had met the new tenant for negotiations few days before 01/07/2010. PW-2 has stated in his cross-examination that the meeting in which the oral agreement was entered into between the parties was in the second half of June 2010. PW-2 has also stated that the new tenant was searched after the meeting in which the oral agreement is alleged to have been made. Thus, it is very clear from the evidence of PW-1 and PW-2 in their cross-examination that the meeting with the defendant in which the alleged oral agreement was entered into was prior in point of time and that only subsequently the negotiations were made with the new tenant and the new tenant was inducted. PW-2 has also stated in his cross- examination that new painting was not demanded by the new tenant. This clearly makes very doubtful the claim of the plaintiffs that the new tenant had wanted distempering etc. of the premises and that the defendant had agreed to pay the service tax instead of the amount spent by the plaintiff. When it has clearly come out in the cross- examination that at the time of the meeting when the oral agreement was entered into there was no new tenant in picture, then the case of the plaintiff that the new tenant CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 27/35 had wanted distempering and that in this view the defendant had agreed to pay the service tax to offset the expenses in new painting falls completely flat. It is to be remembered that as per Ex.P-1 which is the registered lease between the parties does not put the burden of service tax on the defendant. Furthermore, in his cross- examination, PW-1 has stated that apart from Ex.P-1 there was an oral understanding with the defendant based on the plaintiff's claim as per a debit note that the defendant shall pay the service tax. PW-1 has also stated in his cross- examination that the debit note to the defendant was not on the record, but that he could place it on record. However, I find that the plaintiffs have not placed on record any debit note. This also renders doubtful the claim of the plaintiffs that the defendant had agreed to pay the service tax.
39. Now, coming to the claim of the plaintiffs regarding one month's brokerage to the property dealer. In paragraphs 5, 6 and 7 of his affidavit in evidence, PW-1 has stated that in the meeting in which the oral agreement was entered, PW- 1 was accompanied by the PW-2 and the same property dealer who had introduced the defendant, and that after the agreement the plaintiff had engaged the same property broker namely Mr. Sunil Kumar Verma to look for another tenant, and that the property broker found another tenant. However, in his cross-examination, PW-1 has stated that the new tenant was got in July 2010 through a broker other than the broker who was engaged in the deal between the CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 28/35 plaintiff and the defendant. PW-1 also states in his cross- examination that he neither remembered the name of the broker or the amount of brokerage which was paid to the said broker who got the new tenant. PW-1 has stated in his cross-examination that he can try to give the document of payment of the brokerage. However, there is no documentary evidence filed on record regarding payment to the broker. Similarly, PW-2 has also admitted in his cross-examination that the brokers for the deal with the defendant and the new tenant were different. PW-2 states that the brokerage of the new deal with the new tenant was paid through cheque. However, as already mentioned there is no evidence filed on record regarding payment to the broker in respect of the new tenant. This contradiction which has come out in the cross-examination of PW-1 and PW-2 also renders it doubtful that the defendant had agreed to payment of one month brokerage for the new tenant. Apart from that, there is no evidence on record as to what brokerage was paid in respect of the new tenant.
40. The plaintiffs have claimed in their plaint in paragraph 5 that as per the oral agreement, the defendant was supposed to pay the rent amount till the premises remained vacant. The same stand is deposed by PW-1 in his affidavit in evidence. The plaintiffs have claimed that the new tenant was found in June 2010 and that the tenancy started from 01/07/2010. On this basis, the plaintiffs have sought the rental amounts for the months of May 2010 and June 2010.
CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 29/35 However, I find that Clause 5 of Ex.PW-1/D-1 i.e. the new lease with the new tenant records that the lessors have handed over the vacant and peaceful possession of the demised premises to the lessee on 01/06/2010. Further, even PW-2 has admitted in his cross-examination that the defendant vacated the premises in May 2010 after their letter dated 14/05/2010. Thus, in light of the evidence, the premises were vacated by the defendant in May 2010, and the new tenant came into possession on 01/06/2010. Thus, there can be no question of payment of rent for the month of June 2010.
41. I would at this stage also refer to Ex.PW-1/7 Email dated 07/06/2010 which is relied upon by the plaintiff. The learned counsel for defendant had objected to the mode of proof and admissibility of the said document at the time of recording of evidence on 16/01/2012 and the objections were kept open. This Email purports to contain an Email dated 07/06/2010 from the property broker Mr. Sunil Kumar Verma to the defendant and Email dated 07/06/2010 in reply from the defendant. It is the case of the plaintiffs that the property broker had found another tenant and sent email to the defendant with a copy to PW-2 informing that he had found another tenant for the said premises on the same rent on which they had become the tenant and according to the agreement over Rs. 20,00,000/- had become due to the plaintiffs. It is further the case of the plaintiffs that the defendant had replied informing that CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 30/35 the matter was discussed telephonically with Mr. Yogendra Singh and that he confirmed that as and when he will come back from the tour, the would issue the pay order and that me may take some time in coming back. The defendant has specifically denied the Ex.PW-1/7 Email and has also objected to the mode of proof and admissibility. The defendant has given a specific suggestion to both the PW-1 and PW-2 that Ex.PW-1/7 was a forged mail with interpolation. Even in his cross-examination DW-1 Mr. Yogendra Singh has stated that the Ex.PW-1/7 email was forged and fabricated. I find in support of the Ex.PW-1/7, the PW-1 has filed the certificate u/s. 65-B Evidence Act in the form of an affidavit. However, PW-1 is neither the sender nor the recipient of the Ex.PW-1/7 Email. Even in his affidavit u/s. 65-B, PW-1 has in paragraph 2 admitted that the first portion of Ex.PW-1/7 was reproduction of Email sent by Mr. Sunil Kumar Verma, the property broker, to the defendant with a copy to PW-1 Mr. Kaushik and that the second portion of the Email was reply of the defendant with copy to PW-2. Thus, I find that PW-1 not being the sender or recipient of the Ex.PW-1/7 Email, the certificate u/s. 65-B filed by him would not be of any value. Further, even assuming that the certificate u/s. 65-B of PW-1 was valid, however, at best it would be secondary evidence of Ex.PW-1/7 Email and would dispense with the primary evidence. However, this would not dispense with the proof of the contents of the document. The reliance by the plaintiffs upon the Ex.PW-1/7 is based upon the first CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 31/35 portion of the Email which is purported to have been sent by Mr. Sunil Kumar Verma, the property broker who is purporting to seek Rs. 20,00,000/- from the defendant as per the agreement. Hence, it was incumbent upon the plaintiffs to call the property broker Mr. Sunil Kumar Verma as witness to prove the document Ex.PW-1/7. The second portion of Ex.PW-1/7 is admittedly as per the case of the plaintiffs in response to the first portion which is sent by Mr. Sunil Kumar Verma. Hence, I find that in the absence of testimony of Mr. Sunil Kumar Verma, the contents of the document Ex.PW-1/7 are not proved.
42. Further, I find that Ex.PW-1/7 is doubtful in nature, in as much as in the top there are the sender details of Mr. Vineet Kumar of the defendant, thereafter there is reproduction of the purported Email of Mr. Sunil Kumar Anand, thereafter there is reproduction of Email from Mr. Vineet Kumar of defendant, and thereafter at the bottom there is the section stating regards on behalf of Mr. Sunil Kumar Anand along with his address details. Ordinarily a print out of any Email carrying trail mails would not be in such format. Ordinarily, the trail mails would be trailing the last mail and would occur in sequential order. Hence, it seems that there has been some tampering with the Emails contained in the Ex.PW-1/7 and the Emails do not seem to be the exact true print outs. As already mentioned, I find that the certificate u/s. 65-B by affidavit of PW-1 who is neither a recipient or sender of the Emails would not be CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 32/35 valid. Further, in the absence of testimony of Mr. Sunil Kumar Verma, I would not rely upon Ex.PW-1/7 which seems to be a doubtful document.
43. Now, coming to the oral agreement which is put forward by the defendant, as per the defendant the monthly rent was to be paid only till April 2010. However, this is belied by the Ex.P-2 letter dated 14/05/2010 from the defendant to the plaintiff in which the defendant has requested for cancellation of the lease and has stated that the defendant was not in a position to continue with the lease and wanted to close the same, and has requested the plaintiff to look for another tenant. When this request for cancellation Ex.P-2 from the defendant was itself in May 2010, the case of the defendant that there was an oral agreement that rental only till April 2010 was to be paid becomes very doubtful. As has come out in the evidence of PW-2, the defendant handed over possession to the plaintiffs only in May 2010. Thus, it seems highly doubtful that the plaintiffs would have foregone the rent for May 2010 when the defendant was still occupying the premises.
44. Thus, even taking into account the evidence led by the parties regarding their respective oral agreements, I would hold that the plaintiffs have failed to prove that there was any oral agreement for the defendant to pay the service tax or one-month brokerage. I would also hold that the defendant has failed to prove that there was an oral agreement that the rent only upto April 2010 was to be CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 33/35 paid. I would also hold it has come out in evidence that the defendant vacated the premises only in May 2010 and that the new tenant entered into possession on 01/06/2010. On a balance of probabilities, I find that there was an understanding between the parties that the defendant would pay the rent till the time the defendant remained in the property and till the new tenant came into possession. The defendant having vacated the property only in May 2010 after its letter dated 14/05/2010, and the new tenant having come into possession only in May 2010, I find that as per the understanding the defendant was liable to make payment of the rent for the month of May 2010.
45. Thus, in either case, whether holding the evidence on oral agreement to be inadmissible, or assuming the evidence of oral agreement to be admissible and going by the evidence of the parties, I find that in the result, the defendant was liable to the extent of only making payment of the rent for the month of May 2010.
46. In the result, I hold that the defendant is liable to make payment to the plaintiff of rent for the month of May 2010 amounting to Rs. 5,25,000/-. Since the plaintiffs have been deprived of this amount, the defendant shall also be liable to pay interest @ 10% p.a. from the date of institution of the suit till the actual realisation.
47. The issues under discussion are disposed of in the aforesaid terms.
CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 34/35 RELIEF
48. I hereby pass decree in favour of the plaintiff and against the defendant for sum of Rs. 5,25,000/-, along with interest @ 10% p.a. from the date of institution of the suit till the actual realisation.
COSTS
49. Since, the suit is partly decreed in favour of the plaintiffs, I would award costs to the plaintiffs to the extent of one- half.
Decree-sheet be drawn accordingly.
File be consigned to record room.
Judgment pronounced in the open court.
(SATYABRATA PANDA) Additional District Judge-04 Judge Code- DL01057 PHC/New Delhi/19.10.2022 CS no.59274/16 Natascha Chadha & Ors Vs. M/s Yograrj Infrastructure Ltd. page no. 35/35