Delhi District Court
Surjit Singh Gandhi vs M/S Winsoft Educate Pvt Ltd on 24 February, 2026
CIV DJ No. 229/2022
Surjit Singh Gandhi vs. M/S Winsoft Educare Pvt. Ltd.
24.02.2026
ORDER
1. Vide this order, the Court proceeds to decide the application moved on behalf of the defendants under Order VII Rule 11 CPC read with Section 151 CPC and Section 12A of the Commercial Courts Act, 2015.
2. The present case has been filed by the plaintiff for recovery of Rs.1,92,63,276/- on account of monthly lease rent, which was unpaid from November 2019 to October 2021. Brief facts of the case are that the suit property had been given on lease to the defendants in the year 2014 for a period of 9 years. The defendant no. 1 is a private limited company and defendants no. 2 and 3 are its Directors. They are running a play-school in the lease premises as a franchisee of G.D. Goenka Play School. The defendants had not paid monthly lease rent from November 2019 to October 2021.
3. It has been averred that earlier, the defendants were tenants of M/s AKS Homes & Infrastructures (P) Ltd. Later on, the plaintiff purchased the aforesaid property on 07.05.2014 from its previous owner. She signed and executed an MOU dated 09.08.2014 with the defendants and thereby, she allowed the defendants to continuously occupy and enjoy the peaceful possession of the lease premises. Thus, the plaintiff had purchased the suit property at the time when a play- school was fully functional in the premises by the defendants. The CIV DJ No. 229/2022 Page No. 1 of 10 Digitally signed by NAVEEN NAVEEN GUPTA GUPTA Date:
2026.02.24 16:40:08 +0530 Court has not mentioned other averments made by the plaintiff relating to aspects as to how the amount of Rs.1,92,63,276/- has been computed.
4. In their written statement, the defendants have submitted that there was no payment outstanding against them. On the contrary, they have filed a counter-claim for recovery of amount of Rs.1,07,77,438/-. Further, as per government direction, the play-school was almost closed during the period from April 2020 to March 2022 due to Covid-19 pandemic. Therefore, with the mutual consent of the parties, entire rent from 01.04.2020 to 31.03.2021 was waived off by the plaintiff. The plaintiff had only taken rent of Rs.5,50,000/- for the month of April 2021. Further, in the month of May 2021, the tenanted premises was vacated by the defendant with intimation to the plaintiff. In this regard, the key of the tenanted premises was sent to her through speed post, which was duly received by her. The defendant has further submitted as to how they are not liable to pay the amount sought to be recovered by the plaintiff.
5. Through the present application, the defendants have claimed that the present dispute falls within the provision of Section 2(1)(c)(vii) of the Commercial Courts Act, 2015. Thus, the same should have been filed before the Commercial Court. It has been averred that the rented property was purely a commercial property and the same was let out for the business purpose. Accordingly, this Court does not have jurisdiction to entertain the present suit.
CIV DJ No. 229/2022 Page No. 2 of 10
Digitally
signed by
NAVEEN
NAVEEN GUPTA
GUPTA Date:
2026.02.24
16:40:14
+0530
6. Arguments have been heard from both the respective Counsels. Record has been perused.
7. Ld. Counsel for the defendants has argued that it is not in dispute between the parties that the defendants had been running a play- school at the suit property, which had been leased by the previous owner vide lease deed dated 06.05.2014. In the said lease document, the property type had been specifically mentioned as of 'commercial'. Further, in the entire document, it has been repeatedly mentioned that the second party/lessee confirmed and agreed that they shall be responsible for obtaining any of all requisite approvals, licenses, consents for operating their business from the said premises. In para no. 4 also, permission had been granted to the lessee to enter in the premises beforehand for the purpose of timely completion of the interiors and other like activities to enable them to commence business from the said premises. Ld. Counsel has further argued that in the statement of her bank account, annexure P-7, too, the plaintiff has mentioned service tax as one of the components. This reflects that the suit property was used for commercial activity, that was why the plaintiff was paying service tax upon the proceeds of rent. Thus, this Court does not have jurisdiction to try the present case.
8. Ld. Counsel for the plaintiff has argued that as per sale deed dated 07.05.2014 executed by M/s AKS Homes & Infrastructures Pvt. Ltd. in favour of the plaintiff, the status of building was 'residential' in nature. Further, in India, education has not been declared as a commercial activity. Thus, the play-school run by the defendants at CIV DJ No. 229/2022 Page No. 3 of 10 Digitally signed by NAVEEN NAVEEN GUPTA GUPTA Date:
2026.02.24 16:40:22 +0530 the suit property shall also not be considered as a commercial activity. Thus, this Court has jurisdiction to try the present suit. Ld. Counsel has relied upon the precedent laid down in Ambalal Sarabhai Enterprises Ltd. v. K. S. Infraspace LLP, 2019 SCC OnLine SC 1311.
9. Section 2(i)(c)(vii) of the Commercial Courts Act, 2015 defines "commercial dispute" as a dispute arising out of agreements relating to immovable property used exclusively in trade or commerce.
10. In the present case, it is not in dispute that a play-school was being run by the defendants at the leased premises. The plaintiff has filed the present case for recovery of arrears of rent of the leased premises. The said activity of running the play school was, by no stretch of imagination, gratuitous in nature. The Court is of the view that the leased premises were actually used for trade and commerce and thereby, the dispute herein would fall within the four corners of Section 2(1)(c)(vii) of the Commercial Courts Act.
11. The Court is conscious of the precedent laid down by Hon'ble Delhi High Court in which the dispute between the parties was of similar nature as of the present suit. It has been held in Aneeta Leekha v. Kotak Mahindra Bank Ltd., 2025 SCC OnLine Del 7763, that:
6. In a nutshell, the appellant/plaintiff filed a suit seeking recovery of Rs. 32,24,803.96 Paisa from the respondent/bank and her case was that the respondent/bank was in occupation of basement and ground floor of the subject property belonging to her as well as her siblings pursuant to registered lease deed dated 18.03.2008, which stipulated payment of monthly rent of Rs. 5,60,000/- to all CIV DJ No. 229/2022 Page No. 4 of 10 Digitally signed by NAVEEN NAVEEN GUPTA GUPTA Date:
2026.02.24 16:40:26 +0530 the five lessors i.e. herself, her mother and three siblings and at the time of execution of lease deed a security deposit of Rs. 33,60,000/- was made by the respondent/bank, in the sum of Rs. 6,72,000/- in each of their favour. It was stated that monthly rent of Rs. 7,73,925/- was being paid by the respondent/bank and the appellant/plaintiff's share of Rs. 1,54,785/- was being remitted to her account, which included component of service tax as well as TDS. It was the case of the appellant/plaintiff that although possession of the subject property had to be delivered by the respondent/bank by 30.06.2017, however, lease was extended and possession of the subject property was delivered on 30.09.2017. It was stated that the mother of the appellant/plaintiff died on 06.08.2011, and thereafter, she filed another suit for partition of the subject property which is subjudice. Her grievance in the instant suit/appeal is that despite the determination of lease deed on 30.09.2017, rent for the period from 06.08.2011 to 30.09.2017 has been withheld by the respondent/defendant-bank. The said suit came up for hearing before the learned DJ and the following order was passed, which is assailed in the present appeal: "3. At the time of arguments, it came to the notice of this court that the property is commercial property and this dispute is covered within the meaning of "commercial dispute" as defined u/s. 2(1)(c) and by relying upon section 2(1)(c)(vii) R/w explanation u/s. 2(1)(c)(xxii) of The Commercial Courts Act, 2015. The observation of the court is further supported by the judgment of Hon'ble Delhi High Court in the matter of Jagmohan Behl v. State Bank of Indore PAP (OS) No. 166/2016, wherein the facts of the present case is in para materia to the decided case by Hon'ble High Court of Delhi, where such disputes are defined as commercial dispute.
4. Since the dispute is a commercial dispute and as per Section 6 of The Commercial Courts Act, categorically bars the jurisdiction of Civil Courts, whereby this case can only be adjudicated by the Commercial Courts.
5. Since commercial dispute is to be adjudicated by Commercial Court. The present suit is returned to the plaintiff to file it before competent court relying upon the judgment of Hon'ble High Court of Delhi in case titled as Rajeev Mittal v. Commissioner, North Delhi Municipal Corporation, 2024 SCC OnLine Del 4832.
CIV DJ No. 229/2022 Page No. 5 of 10
Digitally
signed by
NAVEEN
NAVEEN GUPTA
GUPTA Date:
2026.02.24
16:40:31
+0530
6. The only power vests in this court to deal with such cases is to return the plaint. Accordingly, plaint is returned." xxx
8. Faced with the aforesaid situation, learned counsel for the appellant then referred to the decision of the Supreme Court in the case of Ambalal Sarabhai Enterprises Limited v. K.S. Infraspeace LLP. This decision is also distinguishable because it pertains to a suit for execution of a mortgage deed which was in the nature of specific performance of the terms and conditions of the Memorandum of Understanding without reference to the nature of use of the immovable property in trade or commerce as on the date of the suit.
9. In the instant matter, the subject property has evidently been put to use exclusively for running of trade and commerce and the suit is referable to Section 2(1)(c)(vii) of the CC Act read with the Explanation Clause.
12. So far as the argument of Ld. Counsel for plaintiff is concerned that in the sale deed, the status of building is 'residential' in nature. In the similar fact situation, the Hon'ble Delhi High Court in TCNS Clothing Co. Ltd. v. Sunil Kumar, 2025 SCC OnLine Del 8466, has held that:
19. As is apparent, there is no absolute prohibition on two parties entering into an agreement for the purpose of leasing out the premises for commercial activity. In the present case, although the property is situated in a residential area, that in itself does not necessarily lead to the inference that, it could not have been used for running a commercial establishment. This Court takes judicial notice of the fact that there are a number of areas where such permissions, if sought for, have been granted and on the basis of which commercial establishments are permitted to operate in residential areas.
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Digitally
signed by
NAVEEN
NAVEEN GUPTA
GUPTA Date:
2026.02.24
16:40:35
+0530
20. Merely because in the present case, permission had not been granted or perhaps not sought for, the same would not amount to the dispute being disqualified from being termed a "commercial dispute". We are of the opinion that if the actual agreement as between the parties relates to the carrying out of some trade or commerce from an immoveable premises, which activity of trade or commerce itself, is per se, neither illegal nor prohibited, the mere fact that the agreement for such an activity pertains to the carrying out of the same from an immoveable property, where such activity may not be permitted to be carried out, would not, by itself remove such disputes from the ambit of the CC Act.
21. We are afraid that we are unable to agree with the observations in Soni Dave (supra) for the following reasons:
a) Such interpretation, if permitted, would necessarily mean a re-
engineering of the CC Act itself, meaning thereby that the same would necessitate the reading of the provisions as "(vii) agreements relating to immoveable property legally meant/permitted to be used exclusively in trade or commerce". Such a reading, as is well known, is neither possible nor permissible. The Courts have to give effect to provisions as they are expressed in the Statute, without reading into it any further or additional words. The Judgment in Soni Dave (supra) commends us to read the Statute thus and in our opinion, such a reading is unsustainable;
b) Assuming that the provision were to be given an extremely strict reading, then, even areas where "mixed land use" were to be permitted would not fall within the ambit of the provision, since the provision reads "used exclusively in trade or commerce". In which event, since the said property would be capable of use for both residential as well as commercial purposes, the property would fall outside the ambit of the definition clause.
c) The practical and factual nature of tenancies in India and more so, in places like Delhi, is such that, large number of agreements are entered into, for carrying on, trade and commerce in properties or areas that may not be earmarked for such purpose. If the statute were to be accorded an interpretation as espoused in Soni Dave (supra), it would take out of its ambit a large number of establishments which are currently in operation, from the CIV DJ No. 229/2022 Page No. 7 of 10 Digitally signed by NAVEEN NAVEEN GUPTA GUPTA Date:
2026.02.24 16:40:40 +0530 provisions of the CC Act. We do not believe that the legislature was unaware of, or disconnected from the ground realities. An interpretation that is in consonance with practical considerations has to be accorded to the statute and we believe that the Judgment in Soni Dave (supra) makes a departure from the same.
d) The most important aspect that leads us to disagree with Soni Dave (supra) is that the illegal or impermissible use of an immovable property is regulated by the concerned municipal authority(ies) and enforced by them. Any illegal or unauthorized use of an immovable property would make a person using it unauthorizedly, liable to such consequences as are prescribed under the relevant municipal laws. The alleged restriction on commercial use of the premises emanates from municipal or zoning regulations, which are regulatory in nature and primarily require the obtaining of appropriate licenses and permits, as has been provided for in Clause 18 of the Lease Deed. Such restrictions, even if breached, may invite administrative action, action under the Municipal laws or necessitate regularization;
however, they do not, per se, render the underlying contract void within the meaning of Section 23 of the Indian Contract Act, 1872.
xxx
24. Further, we find no merit in the contention of the Respondents that the lease in question cannot be regarded to be of commercial use on the ground that the said property is residential in nature. Having consciously executed a Lease Deed permitting the Appellant to use the premises for commercial purposes and having continued to receive rent thereunder, as also permitting the Appellant to carry out modifications and alterations and having carried out certain works for facilitating the use of the premises as a Garment showroom, the Respondents cannot now be heard to plead that such use was impermissible. The principle embodied in the maxim nullus commodum capere potest de injuria sua propria - no man can take advantage of his own wrong - squarely applies.
xxx
25. Having themselves executed and derived benefit under a lease for commercial use of the premises, the Respondents are estopped and cannot now be permitted to disavow the commercial nature of the terms of the lease.
CIV DJ No. 229/2022 Page No. 8 of 10
Digitally
signed by
NAVEEN
NAVEEN GUPTA
GUPTA Date:
2026.02.24
16:40:45
+0530
26. The application of the principle of illegality in running a business from a premises not meant "exclusively for trade or commerce" as espoused in Soni Dave (supra) may not stricto sensu, apply to the present case, since it is not as if the Lease Deed was premised on a complete or absolute prohibition on the carrying out of any commercial activity and the apparent impossibility of such commercial activity being permissible in the premises, in the event of approval, if sought for, were granted by the concerned authority.
27. We reiterate that the interpretation that requires to be accorded to Section 2(1)(c)(vii) of the CC Act would have to be synoptic to the practical considerations of commercial activity as carried out across the country and that in the event that we were to approve the interpretation as accorded to the provisions in Soni Dave (supra), it would lead to a situation where a large number of disputes pertaining to commercial arrangements as between the parties, which are or have been carried out in various localities, at least in Delhi, would effectively be shunted out or excluded from the purview of the CC Act.
28. In any event, given the facts of the present case, considering that neither party believed that the property in question was conclusively unavailable for commercial use, to hold that the dispute raised herein would not fall within the domain of the CC Act is unjustified.
29. We once again reiterate the principles and the interpretation as accorded to the said provision in Ambalal Sarabhai (supra), which upheld the judgment of the Hon'ble High Court of Gujarat in Vasu Healthcare Private Limited v. Gujarat Akruti TCG Biotch Limited, where the Hon'ble Supreme Court has clearly held that what needs to be considered is the purpose for which the property was "actually used". Since, admittedly, in the present case, the leased premises were actually used for trade and commerce (Garment Showroom), the dispute herein would fall within the four corners of Section 2(1)(c)(vii) of the CC Act.
CIV DJ No. 229/2022 Page No. 9 of 10
Digitally
signed by
NAVEEN
NAVEEN GUPTA
GUPTA Date:
2026.02.24
16:40:50
+0530
13. With utmost respect, the Court is of the view that the precedent of the case of Ambalal Sarabhai (supra), relied upon by Ld. Counsel for the plaintiff, does not provide any favour to the plaintiff. Thus, it is held that this Court does not have jurisdiction to try the present suit. However, the provision under Order VII Rule 11 does not apply in the present situation. The plaint and documents be returned after placing on record the certified copies of the same, and after making necessary endorsement in terms of Order VII Rule 10 (2) CPC, with liberty to the plaintiff to file the suit before competent Court. The application stands disposed off with the above observations.
File be consigned to record room after due compliance.
Digitally
signed by
NAVEEN
NAVEEN GUPTA
Announced in the open Court GUPTA Date:
2026.02.24
on the 24th day of February, 2026 16:40:54
+0530
(Naveen Gupta)
District Judge-09, West District,
Tis Hazari Courts, Delhi.
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