Delhi District Court
Shivam Resorts (P) Ltd vs ) M/S Hari Hotels on 6 March, 2010
IN THE COURT OF SH. A.K. CHAWLA : ADJ-19 (CENTRAL) :
TIS HAZARI COURTS : DELHI.
Suit No. 1012/08
Shivam Resorts (P) Ltd.
153, Gujarnwalan Town,
Part II, Delhi. ..... Plaintiff
Versus
1) M/s Hari Hotels
Shop No.A, Hotel Connaught Place,
Behind Shivaji Stadium,
New Deli -110 001.
2) Deepak Bhalla
Partner of M/s Hari Hotels,
Shop No.A, Hotel Connaught Place,
Behind Shivaji Stadium,
New Delhi -110 001
Also At :
32/42, West Punjabi Bagh,
New Delhi -110 026.
3) Joginder Singh
Partner of M/s Hari Hotels,
Shop No.A, Hotel Connaught Place,
Behind Shivaji Stadium,
New Delhi -110 001
4) Balvinder Singh
Partner of M/s Hari Hotels,
Shop No.A, Hotel Connaught Place,
Behind Shivaji Stadium,
New Deli -110 001 ..... Defendants
Date of Institution : 29.9.2004
Date when the case was reserved for judgment : 22.2.2010
Date of Judgment : 6.3.2010
: 1 :
JUDGMENT
Precisely, the facts relevant to the disposal of the case in hand are that plaintiff has filed suit for recovery of Rs.4,43,878/- (Rupees Four Lac Three Thousand Eight Hundred Seventy Eight only) against the defendants.
2. Plaintiff's case proceeds on the premises that the plaintiff was a Private Limited Company and engaged in the Hotel business, having a Hotel under the name and style of M/s Hotel Shivam Kalsia Estate, Opp. Picture Palace, Mussoorie, Distt. Dehradun, Uttranchal. Further, according to the plaintiff, defendant No.1 was a partnership firm and defendant Nos.2 to 4 were the partners of the defendant No.1 and were doing the hotel business also. Then, according to the plaintiff, in the last week of March 2003, the defendants had approached the plaintiff to take on lease the hotel of the plaintiff on certain terms and conditions, which were reduced in writing vide Lease Agreement dated 1.4.2003. Then, according to the plaintiff, as per clause 1 of the Lease Agreement, the lease amount for the period from 1.4.2003 to 31.3.2004 was Rs.6,50,000/-, payable by the defendants in 4 installments as stipulated in clause 3 of the agreement. Also, according to the plaintiff, the first installment of Rs.1,50,000/- was to be paid at the time of commencement of the lease; second installment of Rs.1,50,000/- was to be paid by 30th April, 2003; third installment of Rs.1,50,000/- by 2nd week of June, 2004; and the last installment of Rs.2,00,000/- was to be paid in the 1st week of August, 2003. Further, according to the plaintiff, as per clause 4 of the agreement, the defendants had to pay water and electricity charges of the leased property to the authorized concerned directly, however the property tax was to be paid by the plaintiff. Also, according to the plaintiff, as per clause 19 of the agreement, the Sales Tax as well as assessment expenses were also to be paid by the defendants, as per the clause 27 of the lease : 2 : agreement. Also, according to the plaintiff, as per provisions 26 of the lease agreement, the telephone bills were to be paid by the defendants and as per clause 29 of the agreement, all the demands of all authorities were to be cleared by the defendants as well as of individual, at the time of the termination of the lease agreement. Then, according to the plaintiff, the defendants from the very beginning had not adhered to the terms and conditions of the lease, though the defendants were put in possession of the leased hotel on 1.4.2003, as per the agreement. Further, according to the plaintiff, on 26.4.2003 the defendants had paid a sum of Rs.1,00,000/- by way of two cheques of Rs.50,000/- each, though they were supposed to pay a sum of Rs.1,50,000/-. Also, according to the plaintiff, on 5.5.2003, the defendants had paid another sum of Rs.50,000/-, though by the end of April, 2003, the defendants were supposed to pay a total sum of Rs.3,00,000/- instead of Rs.1,50,000/-. Then, according to the plaintiff, third installment of Rs.1,50,000/- was due in 2nd week of June, 2003 and final installment was due in the 1st week of August, 2003. Further, according to the plaintiff, the defendants had paid further, only a sum of Rs.1,56,000/- on 2.7.2004 vide cheque No.944001 after deducting a sum of Rs.44,000/- as TDS and thus, the defendants had paid a sum of Rs.2,00,000/- on 2.7.2003 and delivered the TDS certificate to the plaintiff but the balance amount of Rs.3,00,000/- had not been paid by the defendants till date, despite of demands raised by the plaintiff various times. Also, according to the plaintiff, apart from the balance lease amount, the defendants had not cleared the necessary/statutory dues, which were to be paid by them as per the lease agreement and were later on paid by the plaintiff. Hence, the suit.
3. Defendants, in the written statement filed, while denying the assertions and contentions of the plaintiff in the suit, took the Preliminary Objections viz. suit was liable to be rejected as the suit was not properly verified; plaintiff was guilty of suppression of facts; and there existed no : 3 : cause of action.
4. In addition to the aforegoing, according to the defendants, the true facts and events were that the plaintiff was guilty of breach of terms of the lease. According to the defendants, plaintiff had not handed over the lease property till after 15 days from 1.4.2003 and clause-9 of the lease deed was not factually correct, as regards the date of handing over the possession. Also, according the defendant, the plaintiff had not handed over the complete portion of the lease property as kitchen was not handed over the kitchen till 1.5.2003 and the crockery was also not handed over, as was agreed between the parties. Then, according to the defendant, plaintiff had forced the defendants to keep his employees i.e. Manager namely Sanjeev Nautial, Guide Kuldeep and Safai Karamchari Veeru Ram, on the ground that their services cannot be terminated due to union problems. Further, according to the plaintiff, as per the agreement, the defendant was at liberty to keep his employees in the Hotel. Further, according to the defendants, the defendants could not have free business and suffered a great deal on that account as well as on account of breaches mentioned above. Then, according to the plaintiff, the defendant was not allowed to run the Hotel till 31.3.2006 as agreed but was forced to vacate and handover its possession to the plaintiff sometime in the middle of January, 2004 and thus, he had suffered a great deal in terms of his earnings from the Hotel. Then, according to the defendants, at the time of handing over of the Hotel by the defendant to the plaintiff, each and every liability of the defendants towards the plaintiff in respect of lease money, electricity bills, telephone bills, electricity bills, water bills and other dues was duly accounted for and in view of the breaches committed by the plaintiff, the amount of lease money was agreed to be fixed at Rs.3,50,000/-, which the defendants had already paid and thus, no amount was due from the defendants to the plaintiff on account of any liability whatsoever.
: 4 :5. In the replication filed, the plaintiff while denying the contentions and allegations of the defendant, reiterated its case.
6. On the pleadings of the parties, the following issues were framed as follows:
(1) Whether the plaint has not been properly
verified?OPD
(2) Whether the suit is bad for suppression of material
facts?OPD
(3) Whether the suit is bad for lack of cause of action?
OPD
(4) Whether this court has no jurisdiction to try the
present suit? OPD
(5) Whether the plaintiff is entitled for the suit amount?
If so, to what sum?OPP.
(6) Whether the plaintiff is entitled for the interest? If
so, at what rate and for which period.
(7) Relief.
7. Plaintiff in support of the case, examined one of its Directors Sh. Raju Sagar as PW1 and closed PE. In his deposition by way of affidavit Ex.PW1/A, plaintiff deposed, what was averred to in the plaint besides exhibition of the documents, which is not being reproduced, for the sake of brevity. Defendants in support of their case examined Sh. Deepak Bhalla as DW1 and closed DE. In his deposition by way of affidavit Ex.DW1/A, he deposed, what was averred to in the plaint besides exhibition of the documents, which is not being reproduced, for the sake of brevity.
: 5 :8. I have heard the Ld. Counsel for the parties and perused the record carefully.
9. My issue-wise findings are as follows:
ISSUE NO.1 :
Whether the plaint has not been properly verified? OPD While no evidence was required to be led, even no submissions have come to be made on the issue in hand. In the written arguments filed as also during the course of oral hearing, the only contention raised by the Ld. Counsel for the defendant has been that the Certificate of Incorporation of the plaintiff company is not proved nor the its Resolution authorizing Sh. Raju Sagar to file the suit, is proved. Said submissions are extraneous to the issue in hand. Having perused the verification clause of the plaint, I do not see any infirmity therein. Issue in hand is therefore, answered against the defendant.
ISSUE NO.2 :
Whether the suit is bad for suppression of material facts? OPD No submission has come to be made as regards any material fact, which makes the suit bad. Suit is for recovery of money and the averments relevant to it are very much mentioned in the plaint. Issue in hand is also therefore, answered against the defendant.
ISSUE NO.3:
Whether the suit is bad for lack of cause of action? OPD No submission has come to be made as to how the suit is bad : 6 : for lack of cause of action. In the suit filed, he plaintiff has categorically alleged for the liability of the defendants in paying its dues, which remained outstanding, despite issuance of notice of demand dated 31.8.2004. It is therefore, held that the suit is not bad for want of cause of action. Issue in hand, is answered accordingly.
ISSUE NO. 4 :
Whether this court has no jurisdiction to try the present suit? OPD No submission either in the written statement or during the course of oral hearing, has come to be made on the issue in hand. In the written statement, there is no specific denial of the fact that the lease deed was executed at Delhi and the defendants reside and work for gain within the jurisdiction of this Court. In view thereof, I have no hesitation in concluding that this Court has the territorial jurisdiction to entertain and try the suit. Issue in hand is answered accordingly.
ISSUE NO. 5:
Whether the plaintiff is entitled for the suit amount? If so, to what sum? OPP.
According to the plaintiff, plaintiff entered into lease agreement with the defendants and leased out its hotel to the defendants at an yearly lease of Rs.6,50,000/- for a period of one year w.e.f. 1.4.2003 to 31.3.2004. PW1, in his deposition by way of affidavit, has deposed that the said lease agreement dated 1.4.2003 is Ex.PW1/2. Said lease agreement Ex.PW1/2 is an unregistered document. Since an yearly rent is reserved under the said lease agreement, it attracts sub-clause (d) of sub-
section (1) of Sec.17 of the Registration Act and thereby, required to be registered. In the absence thereof, it is hit by Sec.49 of the Registration Act to the extent it creates, declares, assigns, limits or extinguishes any : 7 : right in the immovable property inasmuch as, proviso attached to Sec.49 of the Registration Act, permits admissibility of such evidence, to the extent it relates to collateral purposes. In other words, such a document is admissible for any collateral purpose i.e. for any purpose, other than that of creating, declaring, assigning, limiting or extinguishing a right to the immovable property. In this view of the matter, I place reliance upon AIR 1957 Mad 472 Panchapagesa Vs. Kalyanasundaram. In AIR 1964 Pun 346 Gian Singh Vs. Mohan Lal also, it came to be held that such a document inter alia, be received as evidence of any collateral transaction not required to be effected by the registered document. In AIR 1976 Mad 156 R. Selvaraj Vs. R. Radhakrishnan Pillai & Anr., it then also came to be held that the defendant could claim the indulgence of the Court in admitting such portions of the document, as it did not pertain to the creation or extinction of rights in immovable property. In view of the aforegoing, the lease agreement Ex.PW1/2 cannot be said to be inadmissible in evidence in its totality but is acceptable in evidence for any purpose, other than that of creating, declaring, assigning, limiting or extinguishing a right in the immovable property. Contention raised to the contrary by the Ld. Counsel for the defendants is therefore, rejected.
PW1 in his testimony, has categorically deposed that the defendants were put in possession of the hotel on 1.4.2003. Though cross- examined, I find his testimony has gone unshaken. Though the defendants in the written statement inter alia took the plea that the possession of the hotel was given to them after 15 days from 1.4.2003 and that clause-9 of the lease deed, was not factually correct as regards the date of handing over the possession, no cogent evidence in support thereof, has come to be led. Besides the fact that in the lease agreement Ex.PW1/2, the defendant acknowledges having received the possession of the hotel on 1.4.2003 i.e. the date of its execution, the only DW1 during cross-examination has then also admitted that they did not make any complaint in writing to the : 8 : plaintiff for breach of the terms of the lease. Bald deposition of DW1 to the contrary is therefore, rejected. I have therefore, no hesitation in concluding that the possession of its hotel came to be given by the plaintiff to the defendants on 1.4.2003. Yearly lease rent thereof, was agreed to be Rs.6,50,000/- is not in dispute. Thereagainst, plaintiff received a sum of Rs.3,50,000/- vide three cheques, though with defaults in payment, is also not in dispute. Defendants dispute the payment of balance lease amount of Rs.3,00,000/-, on the premises that the plaintiff committed defaults in terms of the lease as enumerated in para-4 of the plaint viz. possession was delivered to them after 15 days from 1.4.2003; kitchen of the hotel was not handed over till 1.5.2003 and therefore, the plaintiff did not hand over the complete portion of the lease property; crockery was not handed over as agreed; plaintiff forced the defendants to keep its employees; defendants were not allowed to run the hotel till 31.3.2006 as agreed; at the time of handing over the hotel by the defendants to the plaintiff, each and every liability of the defendants towards the plaintiff towards lease money, electricity bills, telephone bills and other dues was duly accounted for and in view of the breaches committed by the plaintiff, the amount of lease money was agreed to be fixed at Rs.3,50,000/-, which the defendants had already paid. In support of its plea that at the time of handing over of the possession of the hotel back to the plaintiff by the defendants, the lease money was agreed to be fixed at Rs.3,50,000/-, which stood already paid, defendants on their part but for examining DW1, have not led any evidence. Deposition of DW1 to the said effect, is bald deposition. None of the alleged breaches, on the premises whereof, the parties allegedly agreed to settle the lease money at Rs.3,50,000/- instead of Rs.6,50,000/-, has come to be proved with any cogent evidence. As said earlier, during cross-examination, said DW1 has admitted it to be correct that he had not made any complaint in writing to the plaintiff in respect to the breach of terms of lease deed mentioned in para-7 of his affidavit. When cross-examined further, he says that he had : 9 : asked the father of Raju Sagar verbally. Plaintiff is a Private Limited Company and assumingly, he brought the alleged breaches to the notice of the father of one of its Directors, it is of no consequence for the plaintiff company. In view of the aforegoing, the plea of the defendants that the lease money of Rs.6,50,000/- was agreed to be settled for Rs.3,50,000/- is therefore, rejected. It is therefore, held that the defendants are liable to pay Rs.3,50,000/- towards the lease money to the plaintiff.
As regards the other claims of the plaintiff towards license fees; luxury tax; electricity bills; water bills; telephone bills; sales taxes; advocate fee; thermodyine engineering system; fire extinguishers; water tanker suppliers' bills; and cable TV three months bill, the bills proved on record are Exs.PW1/3 to PW1/6. Perusal of the bill Ex.PW1/3 shows that it is towards the license fee for the period 2004-05, which is not for the period in question. It is therefore, rejected. Ex.PW1/4 is the treasury challan towards the luxury tax paid in the sum of Rs.6,864/- for the month of June, 2003. Another treasury challan Ex.PW1/4 is for Rs.790/- for the month of July, 2004. Since it is for the period beyond the period in question, it is also rejected. Ex.PW1/5 is the receipt of payment of Rs.14,038/- towards the water charges for the period from 1.1.2004 to 1.4.2004. While, Ex.PW1/6 are the four receipts towards the telephone charges for Rs.1217/-, Rs.1127/-, Rs. 706/- and Rs.108/- for the period in question, Ex.PW1/7 are receipts issued by Silori Fire Instruments Co. towards filling of gas etc. of the fire extinguishers dated 11.3.2004 for Rs.245/- and Rs.1500/-. Bill Ex.PW1/8 is the cable bill for the months of January to March for Rs.3600/-. No other bill in original has come to be proved. In view of deposition of PW1, which is unshaken and unrebutted, I have no hesitation in holding that the plaintiff is also entitled to the payment of the amounts against Exs.PW1/4, PW1/5, PW1/6, PW1/7 and PW1/8, which in all comes to Rs.29,405/- (Rupees Twenty Nine Thousand Four Hundred Five only).
In view of the foregoing, I hold that the plaintiff is entitled to : 10 : recover from the defendants Rs. 3,79,405/- (Rupees Three Lac Seventy Nine Thousand Four Hundred Five only) comprising of Rs.3,50,000/- (Rupees Three Lac only) towards the lease money and Rs. 29,405/- (Rupees Twenty Nine Thousand Four Hundred Five only) towards the other dues. Issue in hand is answered accordingly.
ISSUE NO.6:
Whether the plaintiff is entitled for the
interest? If so, at what rate and for which
period.
But for the bald deposition of PW1 that the defendants are liable to pay interest @ 18% p.a. and it was so demanded, no other evidence has come to be led. In the absence of any agreement, the claim made is not sustainable. Keeping in view however, the nature of the transactions and the outstanding amount having remained unpaid despite demand, in my considered view, the plaintiff is entitled to interest @ 9% p.a. RELIEF :
Suit is decreed in the sum of Rs.3,79,405/- (Rupees Three Lac Seventy Nine Thousand Four Hundred Five only) in favour of the plaintiff and against the defendants jointly and/or severally with pendente lite and future interest @ 9% p.a. with proportionate costs.
Announced in the open Court (A.K. Chawla)
on 6th day of March, 2010 Addl. Distt. Judge -19 (Central)
Tis Hazari Courts, Delhi.
: 11 :
Suit NO. 1012/08
6.3.2010
Pr.: None.
Vide my judgment passed separately, suit of the plaintiff is decreed in his favour and against the defendants. Decree sheet be prepared accordingly. File be consigned to record room.
(A.K. Chawla) Addl. Distt. Judge -19 (Central) Tis Hazari Courts, Delhi.: 12 :