Delhi District Court
Kuljit Singh Butalia vs Firstcorp International Ltd on 16 December, 2011
IN THE COURT OF DR, NEERA BHARIHOKE, ADJ1, SOUTH DELHI,
SAKET COURT
Suit no.184 / 2011
In the matter of:
Kuljit Singh Butalia
...Plaintiff
Versus
Firstcorp International Ltd. ...Defendant
16.12.2011
ORDER:
1 Vide this order, I shall dispose of the application of the plaintiff filed under Order 12 Rule 6 CPC.
2 Plaintiff has prayed for decree of possession to be passed in favour of the plaintiff in respect of property bearing no. 39, third Floor, Sadhna Enclave, New Delhi (hereinafter referred to as suit property) on the basis of admissions made by the defendant in its W/S and on the basis of documents filed on record by the parties.
3 In the present matter, the plaintiff has filed a suit for possession, mesne profits and injunction against the suit property bearing no. 39, Sadhna Enclave, New Delhi. Plaintiff has averred that Earthtech Enterprises Ltd. (Hereinafter referred to as EEL), a company and sister concern of the defendant company, was the tenant in respect of second floor of property bearing no. 39, Sadhna Enclave, New Delhi acting through Sh. O.P. Aggarwal. At request of O.P. Aggarwal, plaintiff agreed for raising a construction over the second floor which he will take on rent. Plaintiff had agreed to the same Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 1 of 26 subject to some funds being paid in advance to him towards raising a tempo rary structure. On Sh. O.P. Aggarwal agreeing for the same and paying the same, plaintiff started construction in early part of 2004 and completed the same by March 2004. On completion of structure, plaintiff asked Sh. O.P. Ag garwal to take possession and also told him that he shall not charge rent for first two years in lieu of advanced money. However, at request of Sh. O.P. Ag garwal, third floor i.e. suit property was let out to defendant company. Plain tiff has averred that the defendant company is a tenant in the third floor of the suit property since 1.04.2006 @ Rs. 15,000 per month after deducting TDS. The tenancy has been terminated vide notice dated 07.08.08 under section 106 of Transfer of Property Act asking the defendant to vacate the suit property on or before 31.08.08. The plaintiff has alleged that the possession of the defendant is thereafter unauthorized. By way of present application, Plaintiff has prayed for a decree of possession to be passed on the basis of admissions made by defendant in its WS.
4 The prayer is vehemently opposed by the defendant. The defendant has denied the submissions of the plaintiff. It is submitted by defendant that Defendant company was never a tenant in the suit premises. Defendant has submitted that in the Month of October 2002, the plaintiff approached the sister concern of the defendant i.e. EEL, who is in possession of second floor of the same property, to sell the roof rights of second floor as he was facing some financial problem. It is further submitted that EEL told the plaintiff that it is interested in purchasing the same for its sister concern i.e. The defendant but expressed the inability to pay the entire sale consideration in lump sum and the plaintiff suggested that EEL would pay in installments. It has been further submitted by defendant that plaintiff impressed upon EEL that even he could not keep large amount in his bank account as there was Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 2 of 26 apprehension that his bank account may be attached in the pending proceedings with DRT. Defendant has alleged that an oral agreement was entered into between EEL and the plaintiff with respect to the suit property on sale consideration of Rs. 60,00,000/ and EEL was to make payment in installment of Rs. 11,000/ per month w.e.f. 14.10.2002 in the name of M/s Art Forum as the same was a firm of his daughter and he wanted to help her which will be adjusted towards part payment of sale consideration but possession of roof of second floor will continue with plaintiff. It is also submitted by defendant that EEL paid the amount of Rs. 11,000/ per month accordingly which was later increased to Rs. 20,000/ per month from April 2003 till July 2008. Defendant has contended that there was a clear understanding between EEL and plaintiff that the defendant could start construction of the third floor after some material payment was made by defendant to the plaintiff. Defendant has submitted that it made a payment of Rs. 5,00,000/ in cash on 29.04.2005 to the plaintiff under a valid cash receipt signed and executed by plaintiff and plaintiff handed over physical possession of roof of second floor to defendant for construction over the said roof. The construction work was started in May 2005 and in terms of the oral agreement, the plaintiff executed a formal agreement to sell on cash receipt cumagreement dated 15.09.05 when another sum of Rs. 10,00,000/ was paid by the defendant. However, agreement to sell was not executed because of pending proceedings in DRT. Defendant submitted that construction was completed in the end of November 2005 and defendant further paid a sum of Rs. 5,00,000/ vide cash receipt dated 24.11.2005 duly signed by the plaintiff. Defendant has also alleged that interior decoration of third floor was completed in March 2006 and defendant started using third floor as its office. Thus the total amount alleged to be paid to the plaintiff and the said Art Forum towards the part payment is stated to be Rs. 36,21,000/. Defendant Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 3 of 26 has alleged that however, plaintiff has not executed the formal agreement to sell in favour of plaintiff till now.
5 Ld. Counsel for defendant also argued that vide order dated 28.01.2004 DRT had allowed Bank of Maharashtra to sell the mortgaged property bearing no. A1401, Okhla Industrial Estate, PhaseII, New Delhi belonging to plaintiff's firm/company and if the outstanding claim is not recovered the bank is authorised to sell the suit premises and had also attached the alleged rent amount being paid to the plaintiff.
6 Attention of the court was drawn to a letter written to the defendant company from Bank of Maharashtra enclosing the said order advising the defendant to deposit the amount being paid to the plaintiff with the said bank in compliance of the order dated 28.01.2004.
7 Ld. Counsel for defendant denied that the defendant started paying rent for the suit premises @ Rs. 15,000/ per month after deducting TDS and contended that deduction of TDS from the installments being paid towards sale consideration was at the insistence of the plaintiff and the amount deducted from TDS was returned by plaintiff in cash to the defendant.
8 Ld. Counsel for defendant also argued that defendant has not received the alleged notice of termination of plaintiff on 07.08.08.
9 Ld. Counsel for defendant argued that the defendant company is in possession of the suit property in pursuance of an oral agreement between the parties through the receipt cum agreement executed between the parties.
Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 4 of 26Ld. counsel for defendant has submitted that the defendant company has already paid a sum of Rs. 36,21,000 out of the total sale consideration on assurance of the plaintiff that he could not execute an agreement of sale due to pending proceedings in Debt Recovery Tribunal, Delhi, As the plaintiff mala fidely refused to perform his part of the agreement, the defendant later filed a suit for specific performance against the plaintiff in Hon'ble High Court of Delhi which was filed prior to filing of the present suit.
10 Ld. Counsel for defendant thus argued that as there is no landlord/tenant relationship, hence there is no question of termination of the same qua the suit premises and the present application be dismissed. Ld. Counsel for defendant also argued that substantial payments have been admittedly received by the plaintiff and no explanation has been offered by plaintiff in any of the pleadings which goes to substantiate the stand of defendant. Attention of the court was drawn to the cross examination of plaintiff wherein he admitted the receipt of the said payment. Ld. Counsel for defendant argued that the sale consideration was paid in installments in the form of rent on request of the plaintiff as there was litigation pending against the plaintiff in Debt Recovery Tribunal(DRT) and he was in heavy debts. Ld. Counsel for defendant invited attention to the order of DRT dated 28.01.2004 to substantiate her arguments and she also argued that the present application of the plaintiff is not maintainable, as there is no admission on the part of defendant which is a sine qua non for moving an application under Order 12 Rule 6. Ld. Counsel for defendant also argued that since vide order dated 22.07.09 and 06.08.2011, application of the plaintiff under Order 39 Rule 10 has been dismissed, the present application cannot be allowed.
Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 5 of 2611 Ld. Counsel for plaintiff argued that the receipt, alleged to be receipt cum agreement by the defendants, was not signed by plaintiff and is a fabricated receipt and submitted that the receipt of payment of Rs.4,75,000/ has been admitted by the plaintiff in his crossexamination but that has been made to the plaintiff in respect of paintings and referred to crossexamination of the plaintiff. Ld. Counsel for plaintiff also argued that assuming that this is an agreement that agreement is also inadmissible in evidence because under Article 23A of Schedule 1A of Stamp Act, in case of conveyance in the nature of part performance, 90% of the stamp duty of a conveyance has to be paid and it is required to be compulsorily registered under Section 171A of Registration Act.
12 Ld. Counsel for plaintiff drew my attention to TDS Certificates issued by defendant which reflect the payment of tax at source @Rs. 15,000/ p.m. by the defendant charged and the nature of payment is mentioned to be Rent which reveals that out of the rent paid by the defendant company, defendant company used to deduct TDS. Ld. Counsel for plaintiff contended that in Para 3 of the written statement, defendant has admitted this.
13 Ld. Counsel for defendant controverted by stating that defendant company used to deduct the TDS from the installments which were being paid towards part payment to be adjusted towards the final consideration and the said deduction was made by the defendants at the behest of the plaintiff who used to later pay the amount so deducted to the defendant in cash.
14 Ld. Counsel for plaintiff argued that defendant has been paying rent to plaintiff establishes relationship of landlord and tenant between the Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 6 of 26 parties. Ld. Counsel for plaintiff argued that since TDS Certificate is a statutory document which has been duly proved in the present matter, section 91 and 92 of Evidence Act bars the defendants to lead evidence of any oral agreement contrary to the TDS Certificates which has the effect of contradicting, varying, adding to or subtracting from its terms.
15 I have perused the material on record and have also heard the arguments at length advanced by the Ld. Counsels for both the parties.
16 One preliminary objection has been taken by defendant that the present application is not maintainable in view of dismissal of application of plaintiff under Order 39 Rule 10 CPC. Vide order dated 22.07.09, Ld. Predecessor Court had dismissed that application as she held that there is no clear and categorical admission of any liability by the defendant towards the rent. That finding had achieved finality and consequently the second application was also dismissed on 06.08.2011. The present application has been filed for possession and in my considered opinion this court is not to give a finding with respect to admission of any liability towards rent for disposing of the present application and accordingly, the orders dated 22.07.09 and 06.08.2011 are not bar to deciding this application.
17 Another objection was taken by Ld. Counsel for defendant that an order under Order 12 Rule 6 CPC cannot be passed once the issues have been framed and the trial has commenced. Defendant has relied on judgment of Kanti Singh & Ors. Vs Project & Equipment Corporation of India Ltd. 70 (1997) DLT 419 and Punjab National Bank Vs S. Kartar Singh, (1997) 66 DLT 857. Plaintiff has relied on Parivar Seva Sansthan Vs Veena Kalra & Ors. AIR 2000 Delhi 349, wherein it was held that Rule 6 of Order 12 confers wide powers on Court to pronounce judgment on admission and Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 7 of 26 the words 'at any stage' connote that judgment on admission can be passed even after issues are framed. In the said judgment, Hon'ble High Court of Delhi observed that reliance placed by the respondent on Punjab National Bank Vs S. Kartar Singh(supra) has no force in view of language of Order 12 Rule 6 CPC and also held that observations made in that case do not reflect any proposition of law and must have been passed on the facts of that case. Defendant has argued that in this case, the matter of Punjab National Bank Vs S. Kartar Singh (supra) was not over ruled. However, in another matter, titled Om Prakash Malhotra Vs Shanker Lal Aggarwal, RSA No. 62/2000, decided on 14.03.2011, Hon'ble High Court of Delhi upheld the decree passed under Order 12 Rule 6 CPC which was passed at the stage after issues were framed, trial was in progress and PW1 was examined in part. Thus in view of the decision in Om Prakash Malhotra Vs Shanker Lal Aggarwal, in my considered opinion, a judgment under Order 12 Rule 6 CPC can be passed even at this stage of the suit.
18 The three main ingredients necessary to be found for passing a decree for possession under Order XII Rule 6 are as under :
i) There is admission with respect to relationship of landlord and tenant between the parties.
ii) There is admission with respect to termination of tenancy in respect of the premises coming to an end either by efflux of time or by a notice of termination sent by the plaintiff to the defendant as required by the Section 106 of Transfer of Property Act .
Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 8 of 26iii) There is admission with respect to rent of the premises that it is more than Rs. 3,500/ per month and therefore there is no protection of Delhi Rent Control Act available to the tenant.
19 There is schedule of payment on record filed by the defendants made by the defendant to the plaintiff which reflect that from 14.10.2002, the defendant company made a monthly payment of Rs. 11,000 till 11.03.2003 and thereafter Rs. 20,000 per month till 2.07.2008 through cheque. The defendant company has alleged the said payments were made towards sale consideration however plaintiff has alleged the said payments to have been made to Art Forum that too for hire charges of fittings, fixtures and furniture provided by Art Forum on second floor.
20 Plaintiff has sought reliance on TDS Certificates to substantiate his averment. There are TDS Certificates for the period 1st October, 2002 till 31st March, 2008 which have been issued by the defendant company to the Art Forum and there are TDS Certificates issued by defendant company to the plaintiff from April 2006 to August 2008, which show the nature of payment to be rent. TDS Certificates from April 2006 to August 2008 have been issued as required by Section 203 of the Income Tax Act, 1961. Section 194 I of the Income Tax Act requires a tenant while paying rent to his landlord is required to deduct tax at source at the rate of 15.75% if payee (landlord) is an individ ual or a Hindu Undivided Family. After deducting the tax, the defendant is required to deposit the amount of tax so deducted with the Income Tax Au thorities in accordance with the Rule 31 (1)(b) and issues a certificate to the landlord in which it should be mentioned the amount of tax deducted and de posited with a Central Government and also mention the "nature of payment"
i.e. the amount out of which the tax is deducted and deposited. All these are in a statutory prescribed form namely 16A. In compliance with the require Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 9 of 26 ments of Section 203, Rule 31(1)(b) of Income Tax Rules. The defendant company furnished to the plaintiff each financial year a certificate in form 16A in which it is stated that the said defendant has been paying to the plain tiff each month a sum of Rs. 15,000/ as rent out of which they have been de ducting a sum of Rs. 4725/ as tax and depositing the same with the Central Government account to the credit of the plaintiff, Kuljit Singh Butalia of 39, Sadhna Enclave, New Delhi. At the cost of repetition, it is pertinent to men tion that TDS Certificates specifically state the nature of payment to be rent and TDS certificates have been admitted by Defendant Company. The defen dant company has also mentioned the PAN number of the plaintiff in the said certificate and have in some of the certificates mentioned in the column re quiring the mentioning of nature of payment as "rent" and in some of the cer tificates they have also mentioned in Section 194I, showing that they are consciously paying 15,000/ per month on account of the "rent" to the plain tiff and deducting the tax at the rate of Rs. 15.75% amounting to Rs. 4725/ which has been deposited to his credit with the Central Government. Thus tax deducted at source for these months has been deposited by the defendant against the Permanent Account Number of the plaintiff and the Income Tax Authorities have given the plaintiff due credit for the same. These certificates therefore constitute the clear and unambiguous admission that the defendant company is a tenant under the plaintiff in respect of 3rd Floor of 39 Sadhna Enclave, New Delhi, and has been deducting tax as required by the Section 31(1)(b) of the Income Tax Act and depositing the same with the Central Government as required by Section 203 and Rule 31(1)(b) of the Income Tax Rules and have also been issuing certificates in statutory form 16A.
21 Defendant has relied on the receipts/vouchers for various amounts paid in cash to the plaintiff which have been denied by the plaintiff Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 10 of 26 and have been alleged to be fabricated and receipt of any payment towards sale consideration has also been denied by the plaintiff. The defendant has alleged payments in cash, one of Rs. 5,00,000 in cash on 29.04.2005 under allegedly a valid cash receipt, Rs. 10,00,000 on 15.09.2005 on execution of receiptcumagreement dated 15.09.2005, Rs. 5,00,000 on 24.11.2005 vide cash receipt and payments through cheques to Art Forum with which it alleges it has no privity of contract, totaling to Rs. 36, 21,000. Plaintiff has denied these payments and has submitted, payments, if any were made to Art Forum and that too for hire charges of fittings, fixtures and furniture provided by Art Forum on second floor. The said contention is referred to by the defendant in its WS. Copy of Hire Charges Agreement dated 31st March 2003 executed between EEL and Art Forum is placed on record. Further there are TDS Certificates, wherein the alleged payment made by defendant through cheques towards sale consideration has been shown to be a payment by the EEL to Art Forum and nature of payment has been shown as Contractor 194 C. The said documents support the contention of the plaintiff.
22 Defendant has submitted that plaintiff has admittedly received Rs. 15 lakhs but has not explained the same. During the cross examination of plaintiff he admitted the receipt of the payment of Rs. 10,00,000 however he also stated that it was for sale of a painting by Shanti Dave and also stated that he can produce him in the court. Plaintiff specifically said that he did not enter into any agreement with the defendant company on receipt of Rs. 10 lakhs. He admitted his signatures on the receipt of Rs. 10 lakhs at point A but stated that the same has been fabricated subsequently as there was no stamp of the defendant company at point I ands submitted that the reseipt has been interpolated. Plaintiff has also admitted receipt of Rs. 5 lakhs but said that the same was received by him from Sh. O.P. Aggarwal in his office but Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 11 of 26 categorically stated that the said amount was not paid by the defendant company. Plaintiff in its plaint has also admitted having received money from O.P. Aggarwal and has submitted that at request of O.P. Aggarwal, plaintiff agreed for raising a construction over the second floor which he will take on rent. Plaintiff has submitted that he had agreed to the same subject to some funds being paid in advance to him towards raising a temporary structure. On Sh. O.P. Aggarwal agreeing for the same and paying the same, plaintiff start ed construction in early part of 2004 and completed the same by March 2004. On completion of structure, plaintiff asked Sh. O.P. Aggarwal to take posses sion and also told him that he shall not charge rent for first two years in lieu of advanced money. However, at request of Sh. O.P. Aggarwal, third floor i.e. suit property was let out to defendant company.
23 Admittedly there is no statutory declaration by the defendant with the ROC of having purchased any property. The defendant's books of accounts as well as balance sheets, as admitted by the defendant too, nowhere reflect the payment of such cash towards consideration for purchasing the suit property although the defendant has alleged that plaintiff and defendant had reached an oral agreement/settlement for purchasing of the suit property by the defendant.
24 DW1, in his crossexamination on 2.05.2011 has stated that the amount of Rs.11,000 was paid to Sumit Man Singh (the payment made by cheque allegedly towards sale consideration) and not to plaintiff. He also stated that it is correct that Sumit Man Singh is the proprietor of Ms. Art Forum and has admitted to be a Director in the Art Forum.
Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 12 of 2625 Ld. Counsel for defendant agrued that the said cross examination cannot be read in isolation and referred to other parts of cross examination of Sh. Awdhesh Kumar wherein he had stated:
"It is wrong to suggest that Firstcorp International Ltd. has been a tenant in respect of 3rd Floor, Sadhna Enclave, New Delhi at the monthly rent of Rs. 15,000/ (Rupees Fifteen Thousand only) per month."
26 However, after the witness made the above statement he was confronted with TDS Certificate on record. On seeing the said TDS Certificates, the DW1 stated as under: "It is correct that, after seeing exhibit PW1/1 (Colly) that the defendant company i.e. Firstcorp International Ltd. was paying rent of Rs. 15,000/ ( Rupees Fifteen Thousand only) per month after deducting tax at source which was deposited with the Income Tax Authority and Certificates were issued by the said defendant company to the plaintiff. It is also correct that the nature of payment shown in these certificates is mentioned as "rent".
27 The payment to have been made towards sale consideration of suit property by the defendant and that too in instalments has been attributed to pending litigation against the plaintiff in DRT and the orders passed therein. Ld. counsel for defendant invited attention of the Court to order of DRT dated 28.01.2004 where the plaintiff was the defendant and vide said order, DRT had allowed Bank of Maharashtra to sell the mortgaged property bearing no. A1401, Okhla Industrial Estate, PhaseII, New Delhi belonging to plaintiff's firm/company and if the outstanding claim is not recovered the bank is authorised to sell the suit premises and had also attached the alleged rent amount being paid to the plaintiff.
Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 13 of 2628 Attention of the court was drawn to a letter dated 9.03.2004 written to the defendant company from Bank of Maharashtra enclosing the said order advising the defendant to deposit the amount being paid to the plaintiff with the said bank in compliance of the order dated 28.01.2004. However plaintiff has controverted the submission of the defendant by drawing attention of the court that the said order of 28.01.2004 was passed when plaintiff defendant therein was not present and was also not represented by anyone. Attention of the court was drawn by ld. Counsel for plaintiff to the order of DRT dated 4.10.2006 to controvert the submission of the defendant that plaintiff was in heavy debts and therefore payment was made in installments at request of plaintiff. In the said order DRT has observed that:
"Bank's counsel submits that Bank had already received entire compromised amount in full and final satisfaction of its claim.... Record shows that the bank has already filed a letter dated 19.09.2003 to the effect that entire compromise amount has been received."
29 The said observation clearly reveals that as on 19.09.2003, plaintiff was not under the heavy debts belying the contention of the defendant to be the cause for request of alleged request of plaintiff to make payment of sale consideration in installments as he wanted to screen the amounts from DRT in view of pending litigations against him.
30 Ld. Counsel for the defendant has alleged that cash transactions are not reflected in the balance sheet. Explanation of the defendant for absence of the said entries is untenable and unacceptable and against the spirit of law. Under the provisions of Companies Act, the defendant company is required to make a statutory declaration with the Registrar of Companies of having purchased any immovable property but the defendant company has Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 14 of 26 admittedly made no such declaration. Hon'ble High Court of Delhi in the suit filed by the defendant against the plaintiff and Art Forum vide its order dated 29.10.2009 while disposing off the application of the plaintiff herein asking for balance sheets of the First Corp, defendant herein, for the year ending on 31.03.2005 till 31.03.2008, has observed that:
"It is stated by Ld. Counsel for plaintiff that there was cash transaction between the parties and cash transaction is not reflected in the balance sheet of the plaintiff company. Hence, it is stated that balance sheet for the period in question, which is being asked by the defendant does not reflect the transaction in question."
31 The quoted observation of Hon'ble High Court of Delhi reveals that defendant has been unable to establish its case of having made the payment to plaintiff towards sale consideration in view of the mandatory requirement of Companies Act to incorporate the payment made towards purchase of any immovable property in its balance sheet.
32 Defendant has relied on a judgment titled Sultan Ahmed Vs Rashid Ahmed, AIR 1990 All 47, wherein it was held t hat if both parties are in pari delicto, no party can take advantage of such transaction. It was observed that where sale deed was executed by the plaintiff for the purpose of saving the property from the creditors and in that conspiracy the defendant was also a party, then both parties being in pari delicto, neither the plaintiff nor the defendant could be permitted to take advantage of such transaction. Defendant has argued that defendant and plaintiff both have comitted wrongs and accordingly, none of them can be permitted to take advantage of such transaction. However, in view of observations made above, the defendant has failed to establish that he was paying sale consideration in installments at insistence of plaintiff since plaintiff was under heavy debts. The documents on Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 15 of 26 record clearly establish that defendant was making payment of Rs. 15,000/ as monthly rent to plaintiff. Absence of entries of the alleged payments towards sale consideration in balance sheets and accounts books of defendant and absence of statutory declaration to ROC further fortifies the submissions of the plaintiff with respect to defendant being a tenant and the payment made to be rent. Thus, in my considered opinion, the parties are not in pari delicto.
33 Defendant in reply to the present application has submitted that the defendant company was never a tenant in suit property rather the said portion has been constructed by the defendant company and the defendant company spent an amount of Rs. 25 lakhs approx on the construction. There was no landlord tenant relationship as the plaintiff had entered into an agreement for sale of suit property to defendant.
34 Defendant has relied on the judgments reported as Mahendra Verma (Sh.) Vs Sh. Suresh T. Kailachand 2010IV AD(Delhi) 765, Puran Chand Packaging Indust. Pvt. Ltd. Vs Sona Devi 154(2008) DLT 111, Dena Bank Vs Bindal Construction Pvt. Ltd. AIR 1992 Delhi 171,State Bank of India Vs Midland Industries & Ors. AIR 1988 Delhi 153, Gujrat Cooperative Mill Marketing Vs Jawahar Mal & Sons AIR 2003 Delhi 208, Balkrishna Agarwal & Anr. Vs Central Bank of India & Anr. AIR 1974 Madhya Pradesh 74 and Jeewan Diesels and Electricals Ltd. Vs M/s Jasbir Singh Chadha, AIR 2010 SC 1890, to plead that a decree under Order 12 Rule 6 can be passed only when the admission is unconditional, clear and unequivocal.
Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 16 of 2635 In the matter of State Bank of India Vs Midland Industries & Ors. (supra), a decree under Order 12 Rule 6 was not passed as there were issues framed by the court with respect to varification of the plaint as well as maintainability of the suit against some of the defendants. Similarly in the matter of Balkrishna Agarwal & Anr. Vs Central Bank of India & Anr (supra) there was specific denial by the defendant with regard to hypotheticating of property with the bank as well as there was averment by the defendant that the documents was obtained by fraud and signatures were obtained on blank forms and decree under Order 12 Rule 6 was not passed. However, in my considered opinion, the judgment under Order 12 Rule 6 has to be passed on the facts of the case. In the facts of the present matter, this court has to see that whether there are admissions by the defendant to entitle the plaintiff to a decree of possession.
36 In the matter of Surjit Sachdev vs. K I S Pvt. Ltd. and Others, 66 (1997) DLT54 (DB), Hon'ble High Court of Delhi held that :
"Admission need not be made expressly in the pleadings. Even on constructive admissions, court can proceed to pass a decree in plaintiff's favour."
37 The defence raised by the defendant company to the fact that it has purchased the roof rights of the second floor sometime in October, 2002 stands contradicted by the TDS certificates wherein payment towards rent is shown to be Rs. 15,000 per month and nature of payment is shown as rent. The only explanation forthcoming from the defendant as to why they keep on paying rent to the plaintiff is that they were paying so on the insistence of the plaintiff. Besides the bare averment in the written statement there is nothing Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 17 of 26 else on record to show purchase of any immovable property or assets at any time during the relevant period. In case such a purchase of immovable property have been made by the defendant company this would have been reflected in the balance sheet showing addition in fixed assets as per the requirements of the Companies Act. No such material has been brought on the record by the defendant. As already stated above the TDS certificate constitute a clear and unambiguous admission of the fact that the defendant company became a month to month tenant under the plaintiff with effect from 1st April, 2006 and continued to be so till July 2008 when its tenancy was terminated by the notice dated 7th August, 2008. The defendant company has also contended that they have been making cash payments towards sale consideration for the roof right purchased by him and have also produced some vouchers set to have been signed by the plaintiff in receipt of having received the such cash amounts. The plaintiff has stated in Court that he has not received even a single penny on account of sale consideration either any part or otherwise and that the vouchers are forged and fabricated by the defendant for the purpose of this case. Besides admittedly these cash payments are not reflected in the books of account or in balance sheets of the defendant company as required by Section 209 of the Companies Act, 1956.
38 The plaintiff on the basis of his submissions and documents, more so statutory documents has unerringly been able to prove that status of the defendant is that of tenant. The observations made above read with the statutory documents of TDS certificates and absence of entries in the books of accounts with respect to the payment of cash or through cheques to Art Forum, towards consideration for purchasing the suit property, both admitted Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 18 of 26 by the defendant too, amount to admission by the defendants of the averment of the plaintiff that defendant is tenant in the suit property.
39 Once this court has reached a conclusion that there is admission on part of defendant in respect of relationship of landlord and tenant between the plaintiff and defendant, it becomes equally important to analyse the impact of alleged agreement to sell on the said relationship.
40 Defendant has cited Aloka Bose Vs Parmatma Devi, AIR 2009 SC 1527 to plead that even an oral agreement to sell is valid and another judgment S. Kala Devi Vs V.R. Soma Sundram, AIR 2010 SC 1654, wherein it was held that an unregistered sale deed is admissible in evidence of contract in a suit for specific performance of contract.
41 Even if it be deemed that plaintiff entered into agreement to sell with the defendant, the same is unregistered and in itself does not change the status of the defendant from tenant to be the owner of the siuit property. In the matter of Sunil Kapoor vs. Himmat Singh and others, 167 (2010) DLT 806, Hon'ble High Court of Delhi, has held that:
"With effect from 24th September, 2001, an agreement to sell of immovable property where under the possession is delivered in part performance can only be by a registered instrument bearing the prescribed stamp duty, i.e. on 90% of the total agreed sale consideration."
"...., the defence of an agreement to sell is not a legal defence available to the petitioner in the suit for ejectment."
"The jurisdiction, if any, to stay eviction pending a suit for specific performance is of the court where the suit for specific performance is pending and the court where the suit for ejectment/possession is pending ought not to restrain its hands merely because the suit for specific performance is pending."Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 19 of 26
42 In view of the law discussed in the matter of Sunil Kapoor vs. Himmat Singh and others(Supra), the relationship of landlord and tenant, in the facts of the present matter, continues between the parties.
43 Similar are the observations of Hon'ble High Court of Patna in the matter of Ashok Goenka vs. Chandra Bhushan Singh, 2010 (1)PLJR3317, wherein it has been held that "20. It is evident from the impugned orders that the court below has not at all taken into account the effect of Section 17 (1A) of the Registration Act,1908 as inserted by the amending Act 48 of 2001. The said provision is quoted below :
Section 17 (1A) The documents containing contracts to transfer for consideration any immovable property for the purpose of Section 53 A of the Transfer of Property Act, 1882 (4 of 1882) shall be registered if they have been executed on or after the commencement of the Registration and other related laws (Amendment) Act, 2001 and if such documents are not registered on or after such commencement, then, they shall have no effect for the purposes of the said Section 53A.
21. It is evident from the said provision that any document containing contracts to transfer for consideration, any immovable property for deriving the benefit under Section 53 A of the Transfer of Property Act, must be registered if it has been executed after the commencement of the Amending Act of 2001 and in case, such document is not registered on or after such commencement, it will have no effect for the purpose of invoking the doctrine of part performance under Section 53 A. The doctrine of partperformance protects the rights of a transferee of an agreement for sale, if he has been put in possession or continues in possession in part performance of the contract or has done in furtherance of the contract. Prior to the Amending Act of 2001, a party could claim the benefit of such possession on the basis of the doctrine of partperformance even if the agreement for sale was not registered but the same has now been specifically debarred by the Amending Act. That being the position, it is not open to the courts of law to permit any such plea of possession on the basis of any unregistered document. In the present matter, Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 20 of 26 despite the legal provision being to the contrary by the impugned orders of injunction, the court below has put a stamp of legality over the alleged possession claimed by the plaintiffs on the basis of an unregistered agreement for sale dated 27.3.2002. The same is clearly not permissible under the law."
44 In the present case also the receipt cum agreement which have been claimed by the defendant to be agreement to sell have been executed after the commencement of the Amending Act of 2001 and consequently of no consequence to save the possession of the defendant. The law laid down in Sunil Kapoor vs. Himmat Singh and others (Supra) makes it abundantly clear that plea of part performance cannot be taken by defendant, even if defendant succeeds in suit for specific performance till execution of conveyance deed, in his favour. As per the law laid down in Ashok Goenka vs. Chandra Bhushan Singh (Supra) and Sunil Kapoor vs. Himmat Singh and others (Supra), defendant has no ground in law to save his possession and the defence of an agreement to sell is not a legal defence available to the defendant in the suit for ejectment.
45 In the matter of Puran Chand Packaging Industrial Pvt.Ltd. vs. Smt. Sona Devi and Anr., 154 (2008) DLT 111, Hon'ble High Court of Delhi held:
"Before a decree on the basis of admission in the pleadings can be passed, the admission must be made by the defendant or a party to the proceedings in an unequivocal,unambiguous manner. In other words the admission should not be vague or equivocal."
46 TDS certificate, which is a statutory document that is in the prescribed Form 16A in the Rule 13(1)(b) of the Income Tax Act, issued by the defendant is matter of record and it is admitted by the defendant company too that the defendant company used to deduct TDS. Nature of Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 21 of 26 payment has been mentioned to be rent and has been admittedly paid from 1st April 2006 till August 2008. There are no TDS Certificates after August 2008 which also coincides with the notice of termination of tenancy given to the defendant on 7th August, 2008.
47 As regards termination of tenancy by notice of termination, the plaintiff in para 4 of the plaint has mentioned of the same as well as the plain tiff in his affidavit dated 2422010 (examination in chief) has stated thus : Since May, June I have been asking the defendant to vacate the premises but to no avail. I therefore got a formal notice of termination issued and sent to the defendant by registered post acknowledgment due, at its registered office, which at that time, was 504, Adhishwar Apartments, 34 Ferozeshah Road, New Delhi110001. A copy of the notice is exhibit P2. The same has been issued on my behalf by my advocate on my instructions. The postal receipt is exhibit PW1/5 showing payment of requisite postal charges. The acknowledgment card showing receipt of the letter containing the notice at defendant's office is exhibit P3. A copy of the notice was also sent to the defendant under certificate of posting photocopy whereof is Exhibit P5.
48 The defendant has denied the receipt of notice of termination and has also argued that since it was not in possession of suit property as ten ant, the issue of termination of tenancy does not arise. Defendant has relied on Jeewan Diesels and Electricals Ltd. Vs M/s Jasbir Singh Chadha(supra) wherein the tenant had disputed fact of expiry of tenancy by efflux of time and had also disputed that there had been a determination of tenancy. However, in that case, the parties had specifically confined their case of admission to their pleadings. But in this matter, there is no such confinement and admissions are also based on documents. Thus that decision is not applicable in the facts of this case. Defendant has also relied on Radha Lal Vs M/s Jessop & Company AIR 1992 Delhi 331. In that matter, the Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 22 of 26 original owner had died and in view of Section 3 (c) of DRCA, the suit for possession could only succeed on the strength of the title of the plaintiff and therefore factum as well as validity of notice was in dispute and therefore judgment under Order 12 Rule 6 could not be passed. Thus even the said judgment does not apply to the facts of this case as no such issues arise in this matter.
49 The plaintiff as his own witness appeared in Court as PW1 and was subjected to crossexamination by the learned counsel for the defendant but no question was put to him in respect of the notice of termination sent by him and proved by him in his examination in chief. Thus there is no rebuttal to his contention about termination of tenancy of the defendant by notice dat ed 7th August, 2008. Notice and its service on defendant by the registered post have been proved beyond doubt.
50 Apart from this assuming that the notice was served thereof on defendant is not proved, in the matter of M/s Jeevan Diesels and Electricals Ltd. Vs. M/s Jasbir Singh Chadha(HUF) & Anr, RFA 179/2011 decided on 25.03.11; it had been held by Hon'ble High Court of Delhi that even service of summons in a suit can be treated as a notice under Section 106 of the Transfer of Property Act, 1882. It had been further held that along with the suit, copy of the notice terminating tenancy as a document is served upon the defendant, and which once again can be treated as a notice terminating tenancy. Accordingly taking aid of Order 7 Rule 7 CPC, it had been held that in suits for possession by a landlord, technical defences with respect to notices should not be permitted as long as the 15 day period expires prior to the filing of the suit. This decision of Hon'ble High Court of Delhi was challenged by way of SLP and the same has been dismissed by the Hon'ble Supreme Court of India bearing SLP NO. 15740/2011 on 07.07.2011. In the present case also, the notice for vacation of suit property was given on Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 23 of 26 7.08. 2008 and suit is filed on 6.11.2008 and thus 15 days period had expired prior to the filing of the suit. Further, defendant was served on 11.11.2008. In view of the law laid down in M/s Jeevan Diesels and Electricals Ltd. Vs. M/s Jasbir Singh Chadha(HUF) & Anr, RFA 179/2011 decided on 25.03.11; there is valid termination of tenancy as 15 days period had expired prior to the filing of the suit as well as because service of summons in a suit can be treated as a notice under Section 106 of Transfer of Property Act.
51 In Hill Elliott & Co. Ltd. Vs. Bhupinder Singh, Vol. 1212011 DRJ, Page 438(DB), it has been held that service of notice of termination has to be presumed where it has been sent by registered post A.D. or by Speed Post or UPC or by Courier service. In the present case, the plaintiff has proved that he had sent the notice dated 7th August, 2008 to the defendant company terminating the tenancy by the registered post A.D. as well as by under the certificate of posting.
52 It has been observed by Hon'ble High Court of Delhi in Atma Ram Properties(P) Ltd. vs. Pal Properties(India) Pvt. Ltd. and others, 91(2001) DLT438, "coming to the service of the notice, the plaintiff has placed on record the copy of the notice sent to the defendants under section 1060f Transfer of Property Act. The plaintiff has also placed on record the postal receipts in original by which notice were sent by registered post to the defendants. The plaintiff has also produced on record the original acknowledgement received back which is addressed to Pal Properties (India) Pvt. Ltd. Address is rightly mentioned as H72, Connaught Circus, New Delhi. It bears stamp and is signed by some person acknowledging the receipt of the Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 24 of 26 letter. In view of these documents on record, it cannot be said that the notice was not received by the defendants. Bare denial will not serve any purpose." 53 As per Section 27 of General Clauses Act, if the notice is addressed at the correct address then the same is deemed to have been duly served/ delivered to the addressee. In the present matter also, Copy of notice, original postal receipts of UPC and speed post, AD card in original acknowledging receipt of notice is on record. Thus in view of law laid down in defendant was duly served with notice of termination and the tenancy came to an end on 31.08.2008 and thereafter the defendant has become unauthorized occupant of the suit property thereafter.
54 The third ingredient stands proved as the rent admittedly is Rs. 15,000/ per month far and above Rs. 3500/. Therefore the defendant does not enjoy the protection of Delhi Rent Control Act.
55 After careful perusal and examination of the documents placed on record, I am of the considered opinion that all the ingredients of Order 12 Rule 6 are satisfied. Accordingly, a decree of possession in favour of plaintiff and against defendant is passed and defendant is directed to handover peaceful vacant possession of the suit property to the plaintiff by 31.01.2012. Decree sheet be drawn accordingly. However, the defendant in its W/S has mentioned that in the matter titled Firstcorp International Ltd. vs. Kuljit Singh Butalia and another, the suit filed by the defendant against plaintiff & Ors wherein plaintiff herein is defendant no. 1, an interim order is in operation. As per the interim order, defendants, including plaintiff herein, have been restrained from alienating, transferring or creating third party interest in the suit property till further orders. The said order has become absolute as per submissions of Ld. Counsel for defendant. In view of the said order, plaintiff is restrained from alienating, transferring or creating third Kuljit Singh Butalia Vs Firstcorp International Ltd. Page 25 of 26 party interest in the suit property till the injunction order is vacated in that matter.
56 In view of the observations made herein, the application of the plaintiff under Order 12 Rule 6 CPC is allowed. To come up for further proceedings on 21.12.2011.
Announced in the open court (Dr. Neera Bharihoke)
on 16.12.2011 ADJ1(South), Saket Courts
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