Delhi District Court
M2K Entertainment Private Limited vs Round The Clock Stores Ltd. Page 1 Of 37 on 5 December, 2018
IN THE COURT OF MR. S. S. MALHOTRA: PO:MACT01/
ADDITIONAN DISTRICT JUDGE (NORTH): ROHINI: DELHI
Suit No. 114/17
1. M2K Entertainment Private Limited
E34, Cannaught Place,
New Delhi110001.
Through its authorized representative
Mr. Ghanshyam Singh.
2. Mr. Jagdish Lal Chhabra
S/o Mr. Jai Ramdas
58, Kohat Enclave,
Pitampura, Delhi110088.
Through his constituted attorney
M2K Entertainment Private Limited.
3. Ms. Shakuntala Chhabra
S/o Mr. Jagdish Lal Chhabra
58, Kohat Enclave,
Pitampura, Delhi110088.
Through his constituted attorney
M2K Entertainment Private Limited.
4. Ms. Chandra Bala
W/o Mr. Adesh Gupta
A141, Lok Vihar,
Pitampura, Delhi110088.
Through his constituted attorney
M2K Entertainment Private Limited.
5. Ms. Madhu Gupta
W/o Mr. Adarsh Gupta
A141, Lok Vihar,
Pitampura, Delhi110088.
Through his constituted attorney
M2K Entertainment Private Limited.
....Plaintiffs
Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 1 of 37
VERSUS
Round the Clock Stores Limited
Through its Dirfector Mr. Gaurav Jain
32, Hanuman Lane, Cannaught Place,
New Delhi.
....Defendant
SUIT FOR SPECIFIC PERFORMANCE
DATE OF INSTITUTION : 19.07.2005
JUDGMENT RESERVED ON : 19.11.2018
DATE OF JUDGMENT : 05.12.2018
JUDGMENT
1. By this judgment I shall dispose off the suit filed by the plaintiff i.e. the suit for specific performance as well as the counter claim filed by the defendant. The plaintiffs in their suit have claimed a decree of mandatory injunction directing the defendant to pay the stamp duty and all other charges for registration of the lease deed dated 05.05.2004 and take necessary steps for registering the lease deed dated 05.05.2004. The plaintiffs have also claimed a decree directing the defendant to get the lease deed dated 05.05.2004 registered which was executed in between the plaintiffs and defendant and also claimed a sum of Rs.35,76,437/ towards arrears of rent and other charges for the lockin period of lease deed, alongwith costs. The defendant, on the other hand, in its counter claim which is filed alongwith the written statement has claimed a recovery of Rs.7,31,853.27 from the plaintiff.
2. Firstly, brief facts of the case of the plaintiff are that the plaintiff no.1 is a private limited company doing business of operating and managing multiplex with shopping mall and plaintiffs no.2 to 5, vide separate power Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 2 of 37 of attorneys have authorized the plaintiff no.1 to institute the present suit and plaintiffs accordingly have filed the present suit through its authorized representative Mr. Ghanshyam Singh.
3. It is stated that plaintiff no.1 is the owner of shops bearing no.18, 19, 20 & 25, plaintiffs no.2 and 3 are joint owners of shop on 21 and plaintiffs no.4 and 5 are joint owners of shop no.24 on the ground floor at the plaintiff's M2K multiplex at 16, Mangalam Place, Rohini, Delhi (hereinafter collectively referred as "the suit property").
4. Plaintiff no.1 is the lawful owner of commercial plot of land situated at 16, Mangalam Place, Sector3, Rohini, Delhi wherein he constructed a commercial building consisting of commercial space, shops, cinema, etc. known as M2K Multiplex and the defendant found that the plaintiff's M2K Multiplex is suitable in terms of location, basic infrastructure sufficient to its necessities for running a restaurant/fast food outlet and it accordingly requested the plaintiff to lease out shops bearing no.1821 and 2425 admeasuring super area 2053.80 sq. feet (covered area (1026.90 sq. feet) i.e. the suit shop and accordingly a lease agreement was executed between the plaintiff no.1 and defendant on 05.05.2004 wherein the plaintiff agreed to grant on lease the suit premises to be used as restaurant space for an initial period of three years which could be further renewed for maximum number of four times of three years each and the extension shall not exceed a period of fifteen years w.e.f. 01.08.2004.
5. Some of the terms and conditions of lease have been incorporated in the plaint itself i.e. the lease cannot be terminated by the lessee for any reason whatsoever before expiry of lockin period of twenty four months from the date of commencement and in any case the lessee terminates the lease before the expiry of the lockin period for any reason, he would be liable to Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 3 of 37 pay the rent and other charges for the unexpired lockin period. Defendant agreed to pay monthly rent of @ Rs.1,58,380/ for the initial term of 36 months which was to be divided amongst the plaintiffs in the portion of 65.50% to plaintiff no.1, 14.80% to plaintiffs no.2 & 3 and 19.70% to plaintiffs no.4 & 5 respectively. The defendant has also agreed to pay Rs.4,75,140/ as an interest free security and also amount of Rs.4,75,140/ on account of advance rent equivalent to three months at the time of commencement of operation w.e.f. 01.08.2004. The said advance rent was to be adjusted from the monthly rent payable by the defendant to the plaintiff in twelve equal installments in the first year. As per the agreement, the defendant was liable to pay the maintenance for the use of common area applicable from time to time apart from electricity and water charges. It is further stated in the agreement that stamp duty and registration charges were to be borne by the lessee only and original lease agreement was to be retained by the lessors and a duly attested copy was required to be provided to the lessee.
6. It is further stated that plaintiffs accordingly handed over the vacant and physical possession of the said premises to the defendant on 30.06.2004 to make necessary addition and alteration with respect to specification & requirement of the defendant and the rent was payable from 01.08.2004. However the defendant failed to deposit three months advance rent as stipulated in the agreement and also failed to pay the common area maintenance charges, electricity charges and water charges etc. He also failed to sign separate maintenance agreement and also failed to get the lease agreement registered on one pretext or the other. Accordingly plaintiff wrote a letter dated 20.10.2004 requesting the defendant to clear all the outstanding dues and in response to plaintiff's letter, defendant sent a back Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 4 of 37 dated letter 18.10.2004 which was received by plaintiff on 23.10.2014 alongwith a cheque for a sum of Rs.56,112/ thereby claiming that the advance rent and maintenance charges which were payable by the defendant for the month of October only, have been adjusted against a debit note towards cost which has been incurred by the defendant towards cost of repair to make the suit premises habitable to its need but details relating to various items in the debit note and alleged expenditure incurred were not given to the plaintiff no.1 for verification. It is stated that the defendant unilaterally and arbitrarily alleged that an amount of Rs.4,16,062/ is payable by the plaintiffs under the debit note and in subsequent letter dated 25.10.2004 he simultaneously asserted that he would start paying rent from October 2004 only.
7. Plaintiff took strong objections to the said two letters of the defendant being dated 18.10.2004 and 25.10.2004 and vide its letter dated 26.10.2004 expressed its anguish on the fact that the defendant failed and neglected to pay rent from the months of AugustSeptember 2004 and then he returned the cheque of Rs.56,112/ tendered by the defendant and claimed Rs.10,01,084/ from the defendants i.e. advance rent for three months Rs.4,75,140/, monthly rent for August to October Rs.3,56,355/ i.e. Rs.1,58,380/ less 25%, common area maintenance charges Rs.1,41,711/ and electricity & water charges Rs.27,878/ however the defendant did not clear the outstanding. On 18.11.2004 plaintiff no.1 received another letter dated 02.11.2004 from the defendant enclosing two cheques in the sum of Rs.56,112/ and Rs.32,116/ towards payment of rent and maintenance charges for the month of November 2004 but these cheques were also not accepted by the plaintiff no.1 and were returned vide letter dated 20.11.2004 and plaintiff also raised a fresh demand of Rs.12,12,417/ from Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 5 of 37 the defendant i.e. advance rent for three months Rs.4,75,140/, monthly rent for August to November Rs.4,75,140/, common area maintenance charges Rs.1,88,948/ and electricity & water charges Rs.73,189/.
8. It is stated that since plaintiffs were not accepting the cheques, the defendant called a personal meeting with plaintiffs so that issue of pending payments could be resolved and on 27.11.2004, representative of defendant had a meeting with plaintiff no.1 wherein certain facts were resolved that defendant would pay three months advance rent immediately, debit note issued by the defendant would be verified by the plaintiff with the representatives of the defendant and after verification amount of debit note would be paid, item no.2, 3 and 714 of the debit note raised by the defendant were not payable by the plaintiff, monthly rent would start from 01.09.2004, common area maintenance charges would be paid @ Rs.15/ per sq. feet from 30.06.2004 and the rate of Rs.23/ per sq. feet from 01.09.2004 and actual electricity & water charges would be paid from the date of possession i.e. 30.06.2004.
9. It is stated that plaintiff no.1 vide letter dated 30.11.2004 confirmed the minutes of meeting to the defendant but despite that defendant had not taken any action to clear the dues and accordingly plaintiff no.1 wrote another letter dated 18.12.2004 and reminders, thereafter on 13.01.2005 to the effect that the plaintiff no.1 withdrew its services in the premises with immediate effect. It is stated that thereafter on 19.01.2005 the plaintiff no.1 received a letter dated 07.01.2005 enclosing cheque in the sum of Rs.6,93,091/ purportedly towards rent, maintenance, electricity and water charges for the months of September 2004 to January 2005 but defendant again asserted its claim of Rs.4,12,016/ as a debit note issued towards work done by him. It is stated that the plaintiff no.1 thereafter wrote Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 6 of 37 another letter dated 20.01.2015 to the defendant to pay advance rent and also to settle the electricity and water charges amounting to Rs.1743/ for July to August 2004.
10. It is stated that defendant in its reply dated 21.01.2005 not only attempted to dispute the correctness of minutes of meeting but also defaulted in providing the bills of debit note for verifying the project cost claimed by him and he also delayed the signing of the maintenance agreement and the registration of the lease agreement in spite of various requests. It is stated that plaintiff once again requested the defendant to deposit three months advance rent as per lease agreement and also expressed its commitment and willingness to pay all the legible payment as mentioned in the debit note of the defendant.
11. It is stated that on 11.03.2015 the plaintiff no.1 by referring to its earlier requests and reminders, once again requested the defendant to pay the advance rent for three months and also other charges and a detailed statement of outstanding amount in the sum of Rs.9,38,473/ was also sent to the defendant but the defendant failed to respond and ultimately the plaintiff was shocked to learn from its staff that in the early hours in the morning of 09.03.2015, the defendant sent 2025 persons to remove all fixtures and fittings installed in the leased premises. A police complaint was lodged in this regard and in the same evening the plaintiffs received a notice dated 09.03.2015 issued on behalf of the defendant claiming that since the lease agreement dated 05.05.2004 was not registered in the office of SubRegistrar concerned, it became lease, on month to month basis, terminable by 15 days notice in accordance with provisions of Section 106 of Transfer of Property Act, 1882 and notice to terminate the tenancy was issued by the defendant with a view to nullify the contents of lease Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 7 of 37 agreement and to avoid the payments. The said notice was duly replied by the plaintiffs vide reply dated 17.03.2005 wherein plaintiff denied the contents of defendant's notice and demanded Rs.34,25,008/ towards amount payable in respect of unexpired lockin period of lease as per clause 1.2.(iii) of the lease agreement.
12. It is stated that the plaintiff then received a letter from defendant thereby informing the plaintiff that it is likely to hand over the possession of the premises on 31.03.2005 and plaintiff has to depute someone to take possession between 11:00 am to 01:00 pm. It is stated that since the letter was received by the plaintiff no.1 at 03:00 pm, the plaintiff no.1 replied to this letter denying the liability to pay any amount to the defendant rather it demanded its dues again and plaintiff no.1 also showed its intention to meet the defendant but the defendant avoided to meet the plaintiff. Plaintiff no.1 once again requested the defendant to clear all the dues but he has not paid any heed to the request of plaintiff.
13. The present suit is accordingly being filed by the plaintiffs inter alia praying that a decree directing the defendant to pay the stamp duty and all other charges for registration of the lease deed dated 05.05.2004 and take necessary steps for registering the lease deed dated 05.05.2004. The plaintiffs have also claimed a decree directing the defendant to get the lease deed dated 05.05.2004 executed between the plaintiffs and defendant and also claimed a sum of Rs.35,76,437/ towards arrears of rent and other charges and for rent and other charges for unexpired lockin period of lease deed alongwith costs.
14. Defendant has filed a detailed written statement alongwith its counter claim. First coming to the written statement of the defendant. In the preliminary objection the defendant stated that the lease/tenancy of the Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 8 of 37 premises in question was duly terminated with effect from 31.03.2005 by the defendant vide legal notice dated 09.03.2005 and the plaintiff is not entitled for the relief claimed. It is stated that since the lease agreement was for a period of three years, it was required to be compulsorily registered and since the agreement was not registered its contents cannot looked into for evidence purpose and thus it became the tenancy/lease on month to month basis governed by Section 106 of Transfer of Property Act terminable by fifteen days notice which has been duly terminated and therefore suit of the plaintiffs in the present form is not maintainable.
15. On merits, it is denied that Mr. Ghanshyam Singh is the constituted attorney of the plaintiffs or is authorized by plaintiffs no.2 and 3 or by plaintiffs no.4 and 5 their separate power of attorneys as alleged. Entering into an agreement is however not denied but it is denied that the defendant approached the plaintiff for such lease rather it is stated that it was the plaintiff who approached the defendant and believing the claims made by plaintiff, defendant got attracted and agreed to take on lease a portion of the said multiplex bearing shop no.18 to 21, 24 and 25 on the ground floor of the said multiplex under the name and style of M2K for opening and running a restaurant. Internal arrangement of plaintiff no.1 and plaintiffs no.2 to 5 is denied for want of knowledge. It is submitted that at the time of finalization of the deal, defendant paid a sum of Rs.1,55,000/ to the plaintiffs vide crossed account payee cheque as token money. Contents of preliminary objection with respect to nonregistration of lease deed are reiterated and it is submitted that as per the agreement between the parties the plaintiffs were required to carry out certain jobs in respect of the premises in question to make the same fit for occupation and running of business of restaurant by the defendant which the plaintiffs failed to do Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 9 of 37 despite the request made by the defendant. It is stated that to carry out such repair, defendant incurred huge amount to make the same fit for occupation and running of restaurant and since the plaintiffs failed to carry out the job such as air conditioning, glazing etc. plaintiffs were not entitled to the rent with effect from 01.08.2004 as alleged.
16. It is stated that as a matter of fact that the plaintiffs did not fulfill their obligations with respect to premises in question, which led to termination of lease by legal notice dated 09.03.2015. It is denied that defendant failed to pay advance rent, common area maintenance charges, electricity or water charges in time as alleged. It is also denied that defendant failed to sign maintenance agreement as per terms of agreement. It is submitted that defendant sent a letter dated 18.10.2004 thereby enclosing a cheque for a sum of Rs.56,112/ towards the rent for the month of October 2014 after deducting TDS and it informed the plaintiffs about adjustment of advance rent for three months amounting to Rs.1,58,380/ against debit note raised by the defendant on the plaintiffs with respect to work carried out by the defendant on behalf of and on assurance of the plaintiffs. It is stated that after taking into account the debit note raised on the plaintiffs on account of advance rent, maintenance charges etc. upto October 2004, the defendant was entitled to refund of a sum of Rs.4,079/. It was duly notified to the plaintiffs vide letter dated 18.10.2004 that the said amount/rent would be adjusted in respect of the amount due for the month of November 2004 on account of maintenance charges. It is stated that claim raised by the plaintiffs vide letter dated 20.10.2004 is merely an after thought. It is specifically denied that details relating to various items in the debit note or the expenses incurred, were not given to the plaintiff no.1 and it was duly informed to the plaintiffs about the jobs carried out by the defendant on Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 10 of 37 behalf of and on the assurance of the plaintiffs from time to time.
17. It is denied that a sum of Rs.10,01,084/ was due or payable by the defendant to the plaintiffs as alleged. Various correspondence between the parties are not disputed. It is denied that the claim of the defendant as per the debit note was required to be or was agreed to be verified as alleged. It is denied that CAM charges were payable @ Rs.15/ per sq. feet or Rs.23/ per sq. feet from 30.06.2004 or 01.09.2004. It is stated that no such minutes as alleged were recorded or signed by the parties nor any amount as claimed by the plaintiffs was payable by the defendant and service, legality and validity of letters dated 30.11.2004, 18.12.2004 and 13.01.2005 is also denied. It is further stated that entire amount payable by the defendant to the plaintiffs already stands paid and nothing is due against the defendant and the claim raised from time to time shows that besides being false, the same are inconsistent.
18. It is rather stated that it is the defendant who is entitled to recover Rs.3,98,485/ from the plaintiffs besides the damages on account of failure of the plaintiffs to allow the removal of furniture and fixture from the premises in question and the detail of Rs.3,98,485/ has already been supplied to the plaintiffs. It is submitted that lease in respect of the premises had already been terminated by the defendant vide notice dated 09.03.2005 and that is why the question of defendant being liable to pay a sum of Rs.9.38,473/ does not arise. It is accordingly prayed that the suit of the plaintiff be dismissed.
19. As far as counter claim is concerned, it is stated that defendant is a limited company duly incorporated under Companies Act 1956and Mr. Gaurav Jain, one of the directors and Mr. Udhister Khatri, executive coordinator of the defendant company have been duly authorized to sign and verify the Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 11 of 37 counter claim in terms of resolution dated 11.10.2005. It is stated that the plaintiffs carried out large scale publicity of their multiplex and approached various business houses including the defendant for booking space for taking on lease space for their business activities and the defendant booked a space i.e. Flat no.18 to 21, 24 & 25 at M2K Multiplex of the plaintiffs. Agreement and conditions with respect to the lease deed are not denied but it is submitted that from the very beginning the plaintiffs made it impossible for the defendant to run their restaurant in the premises in question. It is stated that the staff/security of the plaintiffs did not cooperate with the defendant and in fact created problems in smooth running of restaurant off & on and the plaintiffs continued to insist on payments of arbitrary amount, which was not due or payable by the defendant to the plaintiffs as per the agreement between the parties.
20. It is stated that defendant gave Rs.4,75,140/ as refundable security besides advance rent of Rs.4,75,140/ which was to be adjusted from the rent of the subsequent months and out of the said advance rent, a sum of Rs.2,37,570/ already stands adjusted in the rents for the period upto March 2005 and Rs.2,37,570/ are still lying with the plaintiffs. It is stated that as per initial understanding between the parties, the plaintiffs were required to carry out certain works in the premises but they failed to carry out such work rather the plaintiffs represented the defendant that it may carry out the work of its own and further assured that the plaintiffs shall reimburse the amount spent on the said work to the defendant and the plaintiffs also requested the defendant to raise a debit note in respect of the said amount for payment and adjustment by the plaintiffs.
21. It is stated that the defendant has sent a cheque of Rs.56,112/ by stating that a sum of Rs.4,079/ still remains to be recovered which would be Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 12 of 37 adjusted for the amount payable for the month of November 2004 and again letter dated 02.11.2004 defendant tendered charges for the month of November 2004 which was duly notified to the plaintiffs. It is stated that on account of failure of the plaintiffs to carry out necessary works, the plaintiffs are not entitled to rents for the months of August and September 2004 however on the request of plaintiffs, the defendant agreed to pay rent from the month of September 2004 to avoid controversy in this regard. It is further stated that defendant vide letter dated 07.01.2005, sent a cheque for a sum of Rs.6,93,091/ bearing cheque no.362788 drawn on ABN Amro Bank Ltd. towards rent, electricity charges, water charges and maintenance charges upto January 2005 where such details are specifically mentioned and the said cheque was realized by the plaintiffs and all the amount payable by the defendant to the plaintiffs upto January 2005 stood paid.
22. It is stated that another letter dated 07.01.2005 the defendant also notified to the plaintiffs that amount payable towards advance rent for three months amounting to Rs.3,75,788/ after deduction of TDS are being adjusted against the debit note raised by the defendant on the plaintiffs for Rs.4,16,062/ which amount the plaintiffs have already agreed to pay being their responsibility. It is stated that after adjusting the said advance rent, some amount was still recoverable from the plaintiffs but the plaintiffs instead of adjusting the same tried to dispute the same without any reasonable cause and as such it is the plaintiff who is liable to pay the amount to the defendant. It is stated that the defendant wrote a letter to the plaintiff asking him to take possession of the premises w.e.f. 31.03.2005 on which date the defendant terminated the lease deed. It is stated that since the plaintiffs have failed to take the possession rather he objected in removing the goods and articles belonging to the defendant and therefore Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 13 of 37 defendant is not liable to pay anything to the plaintiffs rather he is entitled to immediate return of goods, articles and his belongings which were lying in the premises in question on 31.03.2005 and in the alternative the plaintiffs are liable to pay a sum of Rs.7,31,853.27 being the cost of the said goods, articles and belongings of the defendant. It is further stated that the plaintiffs further failed to pay Rs.3,98,485/ and also denied removal of goods and hence the defendant filed the present counter claim. It is prayed that a decree for recovery of Rs.4,33,352/ inclusive of interest @ 15% per annum from 01.04.2005 till its realization. It is further prayed to pass a decree for mandatory injunction thereby directing the plaintiffs to immediately return the goods and articles owned/belonged to the defendant. It is further prayed to pass a decree of for a sum of Rs.7,31,853.27 being the cost of said goods, articles and belonging alongwith pendentilite and future interest @ 15% per annum till its realization.
23. Plaintiff has filed rejoinder to the written statement filed by defendant taking preliminary objections that the reliance of defendant on the legal notice dated 09.03.2015 is absolutely misplaced therefore the contents of written statement in view of the suit filed by the plaintiff for specific performance are liable to be rejected. As far as reply to preliminary objections is concerned, it is denied that the suit is not maintainable. It is denied that the termination notice is valid or legal as alleged and it is submitted that the defendant cannot terminate the tenancy unilaterally. It is reiterated that although lease agreement dated 05.05.2004 was required to be registered yet it is submitted that under the terms of the said agreement, the responsibility to get the said lease agreement registered with the concerned SubRegistrar was on the defendant itself and it has not come forward to get the said agreement registered and therefore it cannot be Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 14 of 37 allowed to take advantage of its own wrong.
24. On merits it is reiterated that Mr. Ghanshyam Singh is duly constituted attorney of the plaintiffs to institute the present suit on behalf of plaintiff no.1 as well as plaintiffs no.2 to 5 and the arrangements between the plaintiffs inter se was well within the knowledge of defendant from the beginning. It is denied that terms and conditions of agreement are not enforceable It is also denied plaintiff was required to carry out certain works to make the premises fit for use and running restaurant by the defendant by end of July 2004. It is submitted that the premises was already fit for use as per standard norms and on the request of defendant, plaintiff allowed them to carry out certain works according to their needs so as to suit their convenience. It is however further stated that the plaintiff undertook to reimburse the expenditure incurred subject to providing proof of expenditure and verification of expenditure incurred by the defendant which document/bill was neither supplied by the defendant. It is denied that there was any understanding at all that all the amount incurred by the defendant would be adjusted from the amounts payable in future. It is denied that defendant invested huge amount to make the premises fit for occupation and running a restaurant. It is further submitted that the defendant was required to pay rent with effect from 01.08.2004 and it was decided in the meeting dated 27.11.2004 that the defendant would pay rent with effect from 01.09.2004 but the defendant failed to pay rent. It is denied that defendant was entitled to reimbursement of Rs.4,16,062/ or adjustment of the said amount as alleged. It is submitted that this amount was not got verified by the defendant at all and it is denied that any details were sent to the plaintiff vide letter dated 24.03.2005. It is specifically denied that the defendant is entitled to recover Rs.3,98,485/ or Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 15 of 37 Rs.7,31,853.27 as alleged. It is reiterated that defendant is liable to pay the rent and other charges alongwith the rent for the lockin period. Other contents are denied word by word.
25. Separate written statement is filed by the plaintiff to the counter claim taking preliminary objection that the counter claim filed by the defendant is vexatious and is not maintainable and part of the alleged claim of the defendant has already been accounted for in the final statement of account made by the plaintiff in its claim i.e. in the main suit. It is submitted that the counter claim is nothing but counter blast to the suit for specific performance and consequential reliefs as filed by the plaintiffs and the counter claim is not properly valued and appropriate court fees is not affixed. It is submitted that Rs.4,75,140/ has already been adjusted in the final claim of the plaintiff and a debit note for the said amount was also raised by the defendant for Rs.4,16,062/ towards certain job carried out by the defendant stated to be based upon false and frivolous documents and not only this, the defendant attempted to unilaterally adjust the amount in the debit note towards dues payable by defendant but the same was not accepted by the plaintiff. It is further submitted that the expenditure which has been incurred by respondent to suit his requirement was on the basis of long terms understanding that he would use the premises for about fifteen years but in fact he vacated the premises in just seven months and therefore the expenditure of Rs.4,16,062/ cannot be held to be reimbursable by the plaintiff and even otherwise no detail of such expenditure have been supplied. It is submitted that the defendant failed to tender TDS certificates of Rs.1,03,542/ in relation to various amounts deducted on account of TDS inspite of various requests and reminders and plaintiffs reserve their rights to initiate appropriate proceedings against the defendant for not tendering Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 16 of 37 TDS certificates in this regard and further the defendant cannot be allowed to take benefit of his own wrongs. It is further submitted that the defendant attempted to terminate the agreement and the defendant was under a duty to get lease agreement dated 05.05.2004 registered before the concerned Sub Registrar and the defendant is bound to honour the agreement dated 05.05.2004 signed between the parties. It is submitted that defendant has already removed its goods and articles on 11.03.2005 and the alternate claim of the defendant for a sum of Rs.7,31,853/ for cost of goods is bogus and not sustainable and the alleged claim thereby claiming cost of goods for which adjustment has already been made in the debit note for Rs.4,16,062/ is self explanatory.
26. As far as reply on merits is concerned, it is submitted that defendant after satisfying with respect to space and its location had agreed to take the suit premises on rent vide lease agreement dated 05.05.2004 which was initially for a period of three years expendable to fifteen years subject to revising rent in different intervals as mentioned in the agreement itself. It is denied that plaintiff did not cooperate the defendant or its staff was not co operating with the defendant to run restaurant. It is submitted that restaurants i.e. Mc Donald, Pizza Corner and two restaurants run by Govnidaya Health Food Products Pvt. Ltd. are successfully running in the said complex itself. It is submitted that as per the accounts maintained by the plaintiff company an amount of Rs.2,37,570/ has been adjusted only for the period upto February 2005 after giving concession to the defendant with regard to payment of rent starting from September 2004 instead of August 2004. It is denied that certain works were to be done by the plaintiff and it is submitted that the suit premises was already fit for use as per standard norms and at the request of the defendant, plaintiff only allowed Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 17 of 37 them to carry out the works according to their needs at their own costs. It is submitted that the plaintiff undertook to reimburse the expenditure incurred subject to verification of expenditure incurred by the defendant and by providing proof of expenditure thereto which was neither proved nor explained. It is denied that the said amount was to be adjusted from the amounts payable in future. It is denied that the defendant carried out any work at a cost of Rs.4,16,062/. It is reiterated that a sum of Rs.12,12,417/ is pending against the defendant towards rent and other charges which the defendant had not been paying. As far as letter dated 07.01.2005 enclosing a cheque of Rs.6,93,091/ is concerned, it is submitted that the same was received by the plaintiff only on 19.01.2005 and the cheque was issued on 17.01.2005. However as claimed by the defendant it is sent under the cover letter dated 07.01.2005 towards payment of maintenance charges and in the said letter defendant again asserted its claim of Rs.4,16,062/ which is in complete derogation of agreement arrived at between the parties on 27.11.2004. Contents of the suit of the plaintiffs are reiterated and it is submitted that it is the defendant who had not got the lease agreement registered. Accordingly it is prayed that the claim of the defendant is liable to be dismissed.
27. Defendant thereafter filed the replication to the written statement filed by plaintiff to its counter claim thereby denying the facts of written statement of plaintiff and the contents of counter claim were reaffirmed and reiterated as correct.
28. After completion of pleadings following issues were framed 18.01.2008:
(i) Whether the plaintiff is entitled to specific performance of the agreement dated 5th May 2004? OPP.
(ii) Whether the defendant is obliged to pay the stamp duty and have the Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 18 of 37 lease deed registered in terms of agreement dated 5th May 2004? OPD.
(iii) Whether the plaintiff is entitled to claim a sum of Rs.35,76,437/ as arrears of rents and other charges alongwith the interest? OPP.
(iv) Whether the lease between plaintiff and defendant was monthto month lease and was duly terminated by the defendant vide notice dated 9 th March, 2005? OPD.
Counter claim of defendant
(v) Whether the defendant is entitled of mandatory injunction as claimed in the alternative to receive a sum of Rs.7,31,853.27 with interest? OPD.
29. Parties were given direction to file list of witnesses and simultaneously defendant was directed to issue TDS certificates, if already not issued for the amount already deducted.
30. Plaintiff examined Mr. Sunil Kumar Gupta as PW1 and his cross examination was completed on 05.11.2012 and counsel for plaintiff sought adjournment for examining another witness. Said request was allowed and the case was adjourned to 25.02.2013 but on 25.02.2013, counsel for plaintiff vide his separate statement closed plaintiff's evidence and the matter was fixed for defendant's evidence. Defendant examined Mr. Udhister Khatri as DW1 and closed its evidence vide order dated 06.08.2014.
31. I have heard arguments advanced by ld. counsel for plaintiffs and ld.
counsel for defendant. My issuewise findings are as under: ISSUE No.1: Whether the plaintiff is entitled to specific performance th of the agreement dated 5 May 2004? OPP.
And ISSUE No.2: Whether the defendant is obliged to pay the stamp duty Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 19 of 37 th and have the lease deed registered in terms of agreement dated 5 May 2004? OPD.
32. Issues no.1 and 2 are interconnected and are taken up together as finding of both the issues is common. Issue no.1 is regarding entitlement of plaintiff with respect to specific performance and issue no.2 is the basic issue as it was this agreement which is sought to be registered and performed.
33. The onus of first issue was upon the plaintiff whereas the onus of issue no.2 was upon the defendant. In nutshell, the case of the plaintiff is that plaintiff and defendant had entered into an agreement with respect to suit property, possession of which was to be given by the plaintiff on 10.05.2004 as certain fitments period was granted to the defendant from the date of possession during which period, the defendant could have made the suit property habitable for the purpose of running his restaurant for which the suit property was taken on lease. It is also a matter of record that the lease deed was required to be registered by defendant and all the stamp duty was supposed to be paid by the defendant and during all this period when the premises was being renovated by the defendant certain dispute arose between the parties with respect to terms and conditions of agreement itself. The date of agreement was 05.05.2004 and the plaintiff had to hand over the possession on 10.05.2004. However, during evidence PW1 has admitted that the possession of the premises was only given to the defendant on 30.06.2004. He also admitted that three months rent at the time of agreement was to start from 01.07.2004 but since the possession of the said premises was given to the defendant only on 30.06.2004 for fitments/repairing, the fitments period automatically got extended upto 31.08.2004 however the plaintiff meanwhile claimed rent for the months of Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 20 of 37 August to October 2004 to the tune of Rs.10,01,084/ from the defendants and in response, the defendant sent a cheque of Rs.56,112/ towards rent for the month of October only by stating that the amount spent by him towards fitments/repair charges has been adjusted against payable advance rent and remaining amount has been sent to it. From all these facts dispute arose between the parties.
34. As per plaintiff, a meeting was held on 27.11.2004 where it was agreed that rent would be payable from 01.09.2004 whereas the defendant claimed the rent was payable from 01.10.2004 and ultimately since the dispute could not be resolved despite various meeting and exchange of emails, defendant terminated the tenancy with effect from 31.03.2005 by serving a notice dated 11.03.2005 which fact is not in dispute. The plaintiff ultimately filed the present suit and issue no.1 for specific performance with respect to agreement dated 05.05.2004 has arisen.
35. Counsel for plaintiff has argued that since specific performance has to be done by the defendant and the defendant has to get the lease deed registered which it had not done and therefore the defendant is liable to get the same registered, pay stamp duty on the same and also pay the rent for remaining lockin period as the rent accrued to the account for lockin period was dependent upon the registration of the lease deed. It is further agreed that he initially did not get the agreement registered and now, is not performing the agreement for which the present suit was filed and issues no.1 and 2 were framed.
36. Counsel for defendant, on the other hand, has argued that no doubt initially the tenancy was for a period of three years out which lockin period of two years was agreed during which period the defendant would not terminate the tenancy but since the agreement was not registered, this cannot be read Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 21 of 37 in evidence and since this agreement cannot be read in evidence, it cannot be read except for collateral purposes and tenancy would remain from month to month and since tenancy from month to month has already been terminated, there is no question of getting the lease deed registered now or paying the stamp duty or performing the agreement dated 05.05.2004 as alleged. In support of this contention he has relied upon the case of Time Broadband Services Private Limited Vs. Colombian Software Solution Private Limited decided by the Hon'ble High Court of Delhi on 08.09.2009, wherein it was held that "7. It is an undisputed fact that the socalled lease deed between the OMP Nos. 180/2009 & 236/2009 Page 6 Of 10 parties is an unregistered document and it is not on stamp paper. It is only a lease agreement between the parties and a registered lease deed was yet to be executed between the parties. In view of this fact, the lease cannot be considered to be for a fixed period of five years or of a period more than a year and has to be considered as a month to month lease. Any lease which creates a right in the property in favour of lessee for a period of more than a year is required to be registered and it has to be made on an appropriate stamp paper. The Lessee had entered into the premises in January 2008 and till filing of the petition under Section 9, the Lessor had not taken any steps for specific performance of the lease agreement and had not initiated any action against the Lessee for execution of the lease deed. Thus, it is presumed that the Lessor and the Lessee were quite happy with the month to month lease between them. The lease agreement which has been placed on record being an unregistered document, cannot be looked into by the Court and has to be considered only as a piece of junk except that it can be seen for collateral purposes. However, an arbitration agreement entered into between the parties for resolution of disputes is a separable contract and is a valid arbitration agreement and these petitions under Section 9 of the Act filed by the parties would be maintainable.
8. In view of the fact that the lease was a month to month lease, the contention of the Lessor that there was a lockinperiod and the Lessee was bound to retain the premises for a minimum period of five years, prima facie cannot be entertained. A month to month lease is terminable by 15 days notice and it is admitted by the Lessor that 15 days notice was Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 22 of 37 received by the Lessor through an email which was duly accepted by the Lessor. Thus, I prima facie find that the Lessee was not liable to pay rent after 31st March OMP Nos. 180/2009 & 236/2009 Page 7 Of 10 2009 and the Lessor was liable to take the possession of the premises from midnight on 31st March 2009 and was liable to refund the security after adjusting the rent for January, February and March 2009."
37. Counsel for plaintiff, on the other hand, has not filed any law point on the same. Although the plaintiff has been claiming that the possession was not handed over to the defendant yet the fact that the notice was duly served upon the plaintiff by the defendant and tenancy was terminated is not in dispute. Therefore the contention of counsel for defendant appears to be well found and since the lease deed was not registered, it has to be treated on month to month basis, terminable with clear fifteen days notice in nature and in fact has been terminated under Section 106 of Transfer of Property Act. Once the lease deed has been terminated, the question of getting the same registered, paying stamp duty thereon does not arise and since the agreement itself cannot be read in evidence in view of the judgment cited above, this agreement cannot be registered once it has been terminated.
38. Issues no.1 and 2 are accordingly decided against the plaintiff in the main suit bu holding that plaintiff is not entitled to specific performance of the agreement and the defendant is not liable to pay stamp duty. ISSUE No.4: Whether the lease between plaintiff and defendant was monthto month lease and was duly terminated by the defendant vide th notice dated 9 March, 2005? OPD.
39. The onus to prove this issue was upon the defendant. This issue is also a part of issues no.1 and 2 and in terms of judgment in the case of Time Broadband Services Private Limited Vs. Colombian Software Solution Private Limited relied herein above, it has already been clarified that the Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 23 of 37 tenancy which is for a period of more than one year is compulsorily registrable. In this matter, the tenancy was agreed to be more than one year although it is not registered when it was entered into and therefore the defendant was within its right and has terminated the same which the defendant could have done it legally and therefore this issue is also decided against the plaintiff and in favour of the defendant by holding that tenancy was month to month basis and duly terminated by defendant.
40. The issue is answered accordingly.
ISSUE No.3: Whether the plaintiff is entitled to claim a sum of Rs.35,76,437/ as arrears of rents and other charges alongwith the interest? OPP.
And Counter claim of defendant ISSUE No.5: Whether the defendant is entitled of mandatory injunction as claimed in the alternative to receive a sum of Rs.7,31,853.27 with interest? OPD.
41. Both the issues are inter related and evidence on both the issues have been led by both the parties and both the issues are taken up together as finding of issue no.3 is inter related to the adjudication of issue no.5 of counter claim of defendant.
42. The onus to prove issue no.3 was upon the plaintiffs and onus to prove the issue no.5 was upon the defendant. Since the plaintiffs and defendant examined one witness each and all the evidence revolves around as to whether the plaintiff is entitled to any amount and if so to what extent, and also whether any amount is to be payable by the defendant which remained unpaid during tenancy period or whether the plaintiffs are liable to pay any Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 24 of 37 amount to the defendant are inter related issue. The Court has already held herein above that the tenancy was month to month being unregistered. Simultaneously, it is admitted that rate of rent was Rs.1,58,380/ per month. It is also not disputed that common area maintenance (CAM) charges are payable @ Rs.15/ per sq. feet from 30.06.2004 uptill 31.08.2004 and the rate of Rs.23/ per sq. feet from 01.09.2004 and electricity & water charges were payable against actual consumption against the bills from the date of possession i.e. 30.06.2004. It is also not in dispute that premises was let out for commercial purposes and although it was agreed that there was a lock in period of two years yet there was a dispute between the parties and the tenancy could not be continued further and defendant had sent a legal notice to the plaintiff being notice dated 09.03.2005 which is not in dispute rather it was duly replied by the defendant, which is admitted document when the admission/denial of document was conducted. The plaintiff has claimed the rent for 24 months i.e. rent for the lockin period as mentioned at page 68 of the documents apart from certain other expenses/details. The defendant, on the other hand, had been claiming in counter claim a sum of Rs.7,31,853.27 towards the cost of his material in the suit property and also towards the earnest amount paid.
43. Before coming to the calculative part, it has come in evidence and rather PW1 had deposed that he has never been authorized to depose on behalf of plaintiffs no.2 to 5. It is not disputed that the plaintiffs have stated in their plaint that the plaintiff no.1 is the owners of shop no.18, 19, 20 & 25, plaintiffs no.2 and 3 are joint owners of shop on 21 and plaintiffs no.4 & 5 are joint owners of shop no.24 on the ground floor. In nutshell the total super area comes to 2053.80 square feet.
44. I have perused the power of attorney and the power of attorney which has Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 25 of 37 been given by plaintiffs no.2 & 3 and plaintiffs no.4 & 5. The fact remains and stands proved that POA by P2/P3 and P4/P5 was not given to PW1 rather it was given to plaintiff no.1. Once the power of attorney is in the name of a company and PW1 has been authorized by the said company to depose on its behalf the facts stands proved that PW1 has deposed on behalf of all the plaintiffs. Although this issue has not been framed but to appreciate the evidence, this issue was required to be adjudicated upon. The Court is of the opinion that PW1 was authorized to depose and the plaintiff no.1 has authorized the PW1 on its behalf as well as on behalf of plaintiffs no.2 to 5. Therefore it stands proved that PW1 is duly authorized to depose on behalf of all the plaintiffs.
45. Now coming to the appreciation of testimony of PWs with respect to their respective contentions. Before coming to the appreciation of evidence one fact is clear that certain fact are mentioned in the lease deed which is unregistered and keeping in view the settled proposition of law that facts of unregistered lease deed cannot be read in evidence except for colateral purpose, but simultaneously the fact still subsists that certain facts have also been pleaded by the parties in their plaint, written statement, counter claim, written statement to counter claim and evidence etc. and this court is of the opinion that irrespective of overlapping of some facts which according to lease deed cannot be read, this Court is of the opinion that those facts which are forming part of evidence can definitely be read in evidence and the Court would be reading the same.
46. Having come to this opinion, now the fact which can be proved from the evidence and which are mentioned above are clear that tenancy subsisted for the period of seven months only which has been terminated w.e.f. 31.03.2005. In terms of evidence which has come on record the premises Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 26 of 37 was to be given to the defendant by the plaintiff on 10.05.2004 and admittedly the said premises was not given on 10.05.2004 and it was given on 30.06.2004 and the fitment period was upto 31.08.2004 and rent was payable w.e.f. 01.09.2004 and the fitment period from 30.06.2004 to 31.08.2004 was to be utilized by the defendant for making the suit property habitable/usable for the purpose for which the defendant had taken the same.
47. It is admitted by PW1 that possession of the property was given to the defendant on 30.06.2004. It was also admitted by PW1 is cross examination that the defendant was given three months time for renovation of the suit premises which period was rent free but again said that said period was for two months. However subsequently when the legal notice was issued by the defendant being notice dated 09.03.2005 (admitted) and the same was replied by the plaintiff vide reply dated 17.03.2005 (also admitted) and the defendant had sent another notice dated 24.05.2005 to the counsel for plaintiff (again admitted) and in para 10 of the rejoinder to the notice the defendant admitted that he had agreed to pay the rent from September 2004 although the same was not payable, merely to avoid unnecessary controversies. Therefore the two aspects by now have been clarified from the pleadings that admitted rent was Rs.1,58,380/ per month and rent had to commence from 01.09.2004. As far as common area maintenance charges are concerned the same are not in dispute and the same was decided between the parties which was payable @ Rs.23/ per square feet of the said area with effect from 01.09.2004 and CAM charges were @ Rs.15/ per square feet for the period from 30.06.2004 to 31.08.2004. The next controversy is that the plaintiff claims rent for 24 months whereas the defendant claims that the rent was payable only upto Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 27 of 37 31.03.2005 on which date the defendant terminated the tenancy/lease. While disposing off the issue no.4 the court has already observed that the lease was rightly terminated by the defendant by serving a notice under Section 106 of Transfer of Property Act which notice was duly replied by the plaintiff. Therefore the tenancy got terminated on 31.03.2005 stands adjudicated.
48. Now coming to the next part as to whether the possession was given by the plaintiff to the defendant on 31.03.2005 or plaintiff had taken possession on 31.03.2005 and this fact would decide the issue as to for which period the defendant was in possession of the suit premises and for what period he has to pay rent/charges to the plaintiff. The defendant claimed in its notice dated 09.03.2005 that it has called upon the plaintiff with direction to depute his authorized person to take possession of the tenanted premises from the defendant on 31.03.2005 in between 11:00 am to 01:00 pm against proper receipt. The said notice has already been discussed herein above which is not disputed although the plaintiffs claim that they received notice at 03:00 pm on 31.03.2005. Therefore, it stands clarified that the defendant had called upon the plaintiff by way of notice dated 09.03.2005 to reach the suit premises and take its possession. Plaintiff claimed that nobody reached on behalf of defendant as stated in the notice.
49. Now coming to the evidence part, PW1 denied the suggestion that notice dated 09.03.2005 was served upon the plaintiff on 11.03.2005 although he stated that the same was served on 12.03.2005. He further denied the suggestion that no representative of plaintiff was available on 31.03.2005 between 11:00 am to 01:00 pm. He although denied the suggestion that the premises in question was locked and lock of plaintiff was there or representative of plaintiff put another lock on the same, however he Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 28 of 37 volunteered that he learnt from the staff of defendant as well as from the defendant that no lock was there of defendant and staff of plaintiff put the lock there for the purpose of security. Therefore the fact that tenanted premises was under the lock and keys of plaintiff on 31.03.2005 stands admitted by PW1. He further volunteered that the said lock by the plaintiff's staff had been put on the premises in question on 11.03.2005 and the said lock of the plaintiff was removed in June 2007 when the Local Commissioner was appointed by the Court in this matter who observed that some goods of defendant were lying in the premises. He also admitted that from 11.03.2005 till the visit of Local Commissioner to the suit premises, the lock of the plaintiff was on the suit premises. Therefore, the defendant has been able to prove that defendant was not at all in possession of the suit premises after 31.03.2005.
50. Therefore this controversy has also been adjudicated upon now i.e. rate of rent was Rs.1,58,380/ per month, it was to be commenced from 01.09.2004 and defendant was liable to pay rent for seven months and that too from September 2004 till March 2005. This rent comes to Rs.11,08,660/ and the plaintiff is entitled to it. The amount of Rs.11,08,660/ is allowed in favour of plaintiff. As far as common area maintenance charges are concerned that is also not in dispute. The plaintiff claimed and defendant agreed that common area maintenance charges were payable @ Rs.23/ per square feet and being counted in this way it is also not disputed that super area was 2053.80 which comes to Rs.3,30,662/. This amount of Rs.3,30,662/ is also payable by the defendant to the plaintiff. Now coming to the CAM charges for July and August 2004. As per plaintiff itself CAM charges for July and August were @ Rs.15/ per Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 29 of 37 square feet and the same is not disputed by the defendant and it comes to Rs.61,614/. This amount of Rs.61,614/ is also payable to the plaintiff. Now coming to the water and electricity charges. The plaintiff has written a letter dated 20.01.2005 (page 39 of the documents, which is admitted document) in which it is claimed that electricity and water charges were payable from September 2004 on actual consumption basis but the defendant has not paid the electricity and water charges for the months of July and August 2004 which was fitments period which comes to Rs.1,743/ which is not disputed by the defendant. This amount of Rs.1,743/ is also receivable by the plaintiff. Now coming to the electricity and water charges from the month of September 2004 to March 2005. The plaintiffs have filed certain letters on court file but actual bills raised by NDPL and Delhi Jal Board have not been placed on record. Therefore, the amount claimed by the plaintiffs without proving bills cannot be allowed to it. On the other hand, defendant in terms of his letter dated 07.01.2005 (page 37 of the documents Ex.P6) sent a demand draft of Rs.6,93,091/ to the plaintiff which is not in dispute and in the said letter he has referred electricity charges for September 2004 as Rs.25,090/, October 2004 as Rs.44,448/, November 2004 Rs.39,085/ and December 2004 as Rs.38,831/ and total of which comes to Rs.1,47,454/. He has calculated the water charges for September 2004 as Rs.1,045/, October 2004 as Rs.2,134/, November 2004 Rs.1,792/ and December 2004 as Rs.1,746/ and total of which comes to Rs.6,717/. It is also not disputed. Therefore, electricity and water charges i.e. Rs.1,47,454/ and Rs.6,717/ as admitted by the defendant are receivable by the plaintiff.
51. Now coming to the electricity and water charges from January 2005 to Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 30 of 37 March 2005. Plaintiff had claimed (page 68 of the documents) a sum of Rs.34,529/ and Rs.18,356/ towards electricity and water charges for the month of February and March 2005. There is no mention about electricity and water charges for the month of January 2005, therefore, it cannot be ascertained that how much that amount towards water/electricity charges for the month of January is payable. In totality the court has held that plaintiff is entitled to seven months rent which comes to Rs.11,08,660/, seven months common area maintenance charges which comes to Rs.3,30,662/, six months electricity and water charges (since charges of January 2005 not being mentioned) which comes to Rs.2,07,056/. In totality, the plaintiff has to receive this amount of Rs.17,09,735/, details of which is given as under:
S. no. Items Amount
1. Rent for seven months i.e. from 01.09.2004 to Rs.11,08,660/ 31.03.2005
2. Common Area Maintenance Charges from Rs.3,30,662/ September 2004 to March 2005 @ Rs.23/ per square feet
3. Common Area Maintenance Charges for July Rs.61,614/ and August 2004 @ Rs.15/ per square feet
4. Electricity and Water charges for the months of Rs.1,743/ July and August 2004
5. Electricity Charges from September to Rs.1,47,454/ December 2004 (as admitted by defendant)
6. Water Charges from September to December Rs.6,717/ 2004 (as admitted by defendant)
7. Electricity and Water Charges for the month of Rs.34,529/ February 2005
8. Electricity and Water Charges for the month of Rs.18,356/ March 2005 Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 31 of 37 Total amount to be received by the plaintiff Rs.17,09,735/
52. Now coming to the calculation of defendant had paid certain amounts to the plaintiff and as per Ex.P6 (page 37 of document) it has sent a draft of Rs.6,93,091/ to the plaintiff which is not disputed. The defendant in the letter Ex.P6 (admitted) and other various letters written by it i.e. Ex.P3 (admitted), letter dated 18.10.2004, debit note Ex.PW1/8 and letter dated 02.11.2004 Ex.P5 that it is entitled for certain tax i.e. TDS from and with respect to payment payable to the plaintiff and it has tendered certain amount to the plaintiff after deducting the same. The Court has inquired from the ld. counsel for the defendant as to whether the defendant has given any receipt regarding deduction of Rs.16,269/ and Rs.988/ and whether it has filed any receipt on the court record with respect to TDS deduction which has actually been deposited with the concerned authorities and acknowledgment was given to the plaintiff, so that it may also be added in its record but neither any document had been filed on record nor any document has been tendered in evidence nor any document has been filed during crossexamination by DW1 himself, not it has been placed on record till today despite asking by the court that any amount allegedly deducted has been deposited with the competent authority. Therefore this court is of the opinion that although the defendant claimed TDS deduction but in fact the defendant has not tendered the receipt of deducted amount to the plaintiff nor he has been able to prove that it has deposited the said deducted tax with the authorities. Therefore, this court is of the opinion that the defendant is not entitled to any benefit with respect to alleged TDS deduction calculation of which it has not given any receipt or Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 32 of 37 acknowledgment to the plaintiff. Rather it is a case of fraud on the part of defendant. The defendant is not entitled to any such amount as deduction, which after alleged deduction from the plaintiff account have neither been deposited by him with tax authorities nor the receipt of which has been given to the plaintiff in token of prove that the amount which was payable by the plaintiff to the tax authorities has been paid by the defendant as per law, and acknowledgement/receipt of such deductions or deposited have not been proved on record. The Court is not referring any opinion on such fraudulent aspect at this stage. The law shall take its own course.
53. As far as the present matter is concerned, the court is of the opinion that the defendant is not liable to get any benefit with respect to deduction of any amount on account of alleged TDS as it has not deposited the same with the competent authority. Therefore the amount paid by the defendant i.e. Rs.6,93,091/ after deducting tax at source is not the right figure. However this amount of Rs.6,93,091/ stated to be paid by the defendant to the plaintiff is not disputed and the defendant is entitled to adjustment.
54. As far as security amount is concerned, the same is not disputed and it is admitted by PW1 that the defendant has deposited a sum of Rs.4,75,140/ to the plaintiff towards the refundable security at the time of initial agreement. Therefore, the adjustment of the amount permissible to the defendant. Further, it was agreed upon the parties that defendant would pay three months advance rent to the plaintiff and 25% of the rent so paid in advance would be adjusted every month from the actual rent payable by the defendant to the plaintiff. The defendant instead of paying this advance rent claimed that the suit property was not habitable to its requirement/need for the purpose of running a restaurant for which the suit premises was taken Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 33 of 37 on rent and it was to be made habitable and on the saying of plaintiff it has spent certain amount on the suit property and for that he has spent an amount of Rs.4,16,062/ on the suit property for which debit notice was issued by him and the rent which was payable in advance has been deducted/adjusted therein. This fact is clarified by him in its letter dated 18.10.2004 Ex.P3 (page 24) wherein he writes that advance rent and payable for the month of October 2004 has been adjusted against debit note towards costs incurred by RTCSL to be recovered from the plaintiff for shop no.1821 and 2425, Ground Floor, M2K Mall, Sector3, Rohini, Delhi. Subsequently he made some calculation for three months rent less TDS, plus maintenance charges less TDS, and claimed that he had only to pay Rs.4,11,983/ to the plaintiff whereas he has spent an amount of Rs.4,16,062/ on renovation and as such Rs.4,079/ is still recoverable by him from the plaintiff. The motive of mentioning the said details is that the debit note issued by the defendant is sought to be adjusted against the advance rent. Now the question is whether the defendant is entitled to the same. Counsel for plaintiff has argued that the details of debit note were never given by the defendant to the plaintiff and it was agreed between the parties in terms of their meeting that he would provide the details of such amount spent by him towards renovation thereafter the plaintiff would verify the same and then plaintiff would make necessary adjustment. Now the issue is as to whether the defendant actually spent the amount on renovation, as to whether this aspect was agreed to by the parties and as to whether it was necessary for the purpose of running its restaurant. There is no document and evidence on this aspect. As far as oral evidence is concerned, the defendant neither placed on record such bills nor supplied the same to the plaintiff. There is no premeeting of mind in between both Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 34 of 37 the parties with respect to all 17 articles for which the defendant is claiming a debit note amount. Defendant has not proved whether this amount or the amount towards purported TDS, has been actually spent or not. Coming to the evidence, the plaintiff has never accepted the document which according to the defendant it has paid the amount to the plaintiff towards these expenses. The detail of debit note i.e. page 25 Ex.PW1/8 and it covers about 17 articles which includes unit, quantity, rate of articles, installation charges and amount of sales tax i.e. he claims towards the cost wise items including tax, installation charges including cost of WCT i.e. tax and the total of which comes to Rs.4,16,062/. However in the crossexamination of PW1 he admits that at the time of handing over possession some work was to be completed which was got to be done by the plaintiff. He further volunteered that some of the work was responsibility of the plaintiff company and some extra work was got done by the defendant company and cost of extra work was not the liability of the plaintiff. When he was asked to specify which was extra work done by the defendant, PW1 replied that high voltage AC (HVAC) and glazing was the work to be carried out by the plaintiff company but besides this the other work which has been included in the debit note was done by the defendant company without any authority. He denied the suggestion that the item at serial no.1 to 17 of debit note were the responsibility of plaintiff company. The evidence of defendant is not specific on this aspect.
55. I have perused the debit note which is not in dispute and after going through the same, the cost of high voltage AC which is at serial no.1 and cost was around Rs.1,27,223/. There is no fruitful assistance from the plaintiff in this regard despite granting sufficient time to plaintiff to explain as to how the amount claimed by the plaintiff in its entire suit has been Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 35 of 37 calculated. In comparison of the plaintiff, the defendant has put its efforts as to how this amount is being claimed by the plaintiff and defendant. Admittedly, the defendant has not placed any bill on the court file to show that he actually spent Rs.4,16,062/ on these items. It has also not been shown on record whether defendant actually spent this amount or it is only a quotation. Therefore this court is of the opinion that in absence of any document filed on record by the defendant in support debit note Ex.PW1/8, the defendant is not entitled to claim any amount mentioned in the debit note expect item no.1 that was to be done by the plaintiff. The cost of the high voltage AC/glaze was Rs.1,27,223/ which was done by the defendant is taken on its face value even no bill has been placed on record. Since admitted by the plaintiff, counsel for plaintiff has argued that the defendant is not entitled to receive the said amount. This Court is of the opinion that once the plaintiff has given free hand to the defendant to install high voltage AC then the amount even if it is on the higher side, as is being claimed by the defendant is payable by the plaintiff. Therefore this court is of the opinion that out of Rs.4,16,062/ the defendant is entitled to recover only Rs.1,27,223/ from the plaintiff on account of repair. In nutshell, the plaintiff is entitled to the amount out of which the defendant has paid. The defendant in totality has paid a sum of Rs.12,95,454/, details of which is given as under:
S. no. Items Amount
1. Rent Rs.6,93,091/
2. Refundable security Rs.4,75,140/
3. High voltage AC/glaze Rs.1,27,223/
Total amount defendant has already paid Rs.12,95,454/ Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 36 of 37
56. Therefore, the issue no.3 and issue no.5 of counter claim are disposed off by holding that plaintiff is entitled to Rs.4,14,281/ (17,09,735−12,95,454). As far as the amount for lockin period is concerned, since the lease deed was not registered and the tenancy has been terminated on 31.03.2005, the plaintiff is not entitled to this amount. As far as the claim of defendant with respect to cost of goods in counter claim is concerned, the defendant has not been able to prove the same. Therefore, that part of issue is decided against the defendant.
ISSUE NO.6 (RELIEF)
57. Keeping in view the findings on all the issues, the suit of the plaintiff is partly decreed in favour of plaintiffs and against the defendant thereby directing the defendant to pay Rs.4,14,281/ alongwith interest @ 8% per annum from the date of filing the present suit i.e. 19.07.2005 till its realization, in the portion of 65.50% to plaintiff no.1, 14.80% to plaintiffs no.2 & 3 and 19.70% to plaintiffs no.4 & 5 respectively. Proportionate costs of the suit is also awarded to the plaintiffs. Decree sheet be prepared. Counter claim of the defendant is dismissed with no order as to cost.
Digitally signed by SUKHVIR SUKHVIR SINGH
File be consigned to record room. SINGH MALHOTRA
Date: 2018.12.05
MALHOTRA 16:07:15 +0000
ANNOUNCED IN THE OPEN (S. S. MALHOTRA)
COURT ON 05.12.2018 ADDITIONAN DISTRICT JUDGE/
PO, MACT NORTH, ROHINI,
DELHI.
Suit no. 114/17 M2K Entertainment Pvt. Ltd. Vs. Round The Clock Stores ltd. Page 37 of 37