Bangalore District Court
M/S.Millennia Realtors Pvt. Ltd vs M/S.Aricent Technologies on 13 April, 2016
Govt. Of Karnataka
C.R.P.67] TITLE SHEET FOR JUDGMENTS IN SUITS
Form No.9(Civil) AT MAYOHALL UNIT, BANGALORE.
Title sheet for
Judgment in suits
(R.P.91)
Present: Sri. B.Venkatesha, B.Sc., LL.B,
(Name of the presiding judge)
Original suit No.16735/2005
(CCCH-29)
Plaintiff:- M/s.Millennia Realtors Pvt. Ltd.
A company incorporated under
The provisions of the Companies
Act, 1956 and having its
registered office at The Millenia,
Tower B, Level 12-14, 1 & 2,
Murphy Road, Ulsoor,
Bengaluru- 560008.
(By Pleader M/s Dua Associates)
V/s
Defendant:- M/s.Aricent Technologies
(Holdings) Ltd., (Transferee
Company on amalgamation
With Flextronics Software
Systems Limited and formerly
Known as Hughes Software
Systems Limited) A company
Incorporated under the provisions
Of Companies Act, 1956 and
Having its registered office at
No.5, Jain Mandir Marg (Annexe)
Cannaught Place,
New Delhi- 110 001.
(By Pleader M/s King & Patridge)
2 O.S.No.16735/2005
Date of Institution of the suit 27.6.2005
Nature of the (Suit or pro-note, suit for Ejectment.
declaration and possession, suit for
injunction, etc.)
Date of the commencement of recording of 12.4.2011
the Evidence
Date on which the Judgment was 13.4.2016
pronounced
Year/s Month/s Days
Total duration 10 9 16
XXVIII ADDL.CITY CIVIL JUDGE
BANGALORE
3 O.S.No.16735/2005
JUDGMENT
This is a suit filed by the plaintiff A. to direct the defendant to quit and deliver vacant possession of the property measuring 82,055 sq.ft of saleable built up area comprising of 38,310 sq.ft on the ground floor across Blocks A, B & C, 23,375 sq.ft on the first floor across Blocks A & C and 20,370 sq.ft on the second floor of Block A, as more fully described in the plaint C schedule (herein afterwards referred to as suit C schedule property) B. To direct the defendant to pay Rs.4,51,96,169/- with future interest at 24% p.a. from the date of filing this suit till date of payment and C. To direct the defendant to pay damages to the plaintiff for wrongful occupation at the rate of Rs.30/- per sq.ft per month for building and at Rs.10/- per sq.foot per month for service areas in the basement from the date of filing this suit till the date of handing over possession of the schedule C property with interest at 24% p.a. from the dates the sum fall due to the date of payment and for costs, etc.
2. The plaintiff's case in brief as set out in the plaint is that the plaintiff and the defendant are the Companies incorporated under the provisions of the Companies Act, 1956. The defendant was earlier known as Hughes Software Systems Pvt. Ltd. and that it is now known as Flextronic Software Systems 4 O.S.No.16735/2005 Ltd. On 3.5.2003, the plaintiff had entered into a Development Agreement with one Rani Rasamani Constructions (formerly known as RR Real Estates & Constructions) in respect of the lands bearing Sy.Nos.18/1, 18/2, 18/5A, 18/5B, 20/1A, 20/1B, 20/2B and 20/3 of Kadabeesanahalli village in all measuring 6 acres 20 guntas of land bounded on East by Marathahalli - Sarjapur ring road, West by partly by nala and partly by Sy.No.20/2B, North by partly by road and partly by Sy.No.20/2A and 20/2B and South by Sy.No.17 of Kadabeesanahalli village and Nala as more fully described in plaint A schedule (herein afterwards referred to as suit A schedule property). It was agreed that the plaintiff and M/s.R.R Constructions would share the land and the development area in the ratio of 73 : 27 out of the suit A schedule property. The said M/s.R.R Constructions had already acquired title to an extent of 4 acres 33 guntas of land in the Sy.No.18/1, 18/2, 18/5A and 18/5B only. The said Company had represented and promised the plaintiff that it would acquire title and obtain all necessary permissions in respect of the balance areas that covered under the said Development agreement dt.3.5.03. Under the said agreement it was proposed that 3 blocks of buildings with a total saleable area of 1,12,405 sq.ft which was to include other infrastructure for entry and exit 5 O.S.No.16735/2005 of vehicles, parking space, sidewalks, landscaping etc. would be developed as First phase. It was further pleaded that the defendant was keen on starting software operations in Bengaluru and was in urgent need of a large development centre in Bengaluru to meet its various projects in the pipeline and after discussions with the plaintiff and M/s.R.R.Constructions, expressed its desire to take on lease properties with certain specifications. Accordingly an agreement for development of land, construction of building and subsequent lease with purchase option to the lessee was entered into by the plaintiff, the defendant and M/s.R.R.Constructions on 19.5.2003 in respect of a portion of suit A schedule property. Accordingly out of suit A schedule property, in 2 acres of land, the plaintiff and M/s.R.R.Constructions agreed to develop and deliver a total saleable area of 1,03,100 sq.ft in the buildings to the defendant. The said property is mentioned as plaint B schedule property and that it is herein afterwards referred to as suit B schedule property. The defendant on 22.5.2003, through a letter agreed to take on lease the balance area of 9,305 sq.ft. This proposed lease was initially for a period of 5 years with an option to Hughes to renew if for a further period of 5 years immediately following the initial period of 5 years. The said lease was to 6 O.S.No.16735/2005 commence once the development of Phase-1 was completed and the occupancy certificate was obtained and possession was handed over to the lessee. The obligation to pay rent commenced from the date of handing over possession of the suit B schedule property. The rate at which the rent was payable was Rs.18/- per sq.ft per month for the building and Rs.6/- per sq.ft per month for the service area situated in the basement floor of the building with an escalation at the rate of 6% annually. The defendant as lessee would pay the interest free security deposit of a sum equivalent to 15 months rent to the lessor and of which sum, Rs.30,00,000/- was payable at the time of execution of the Hughes development agreement and the balance at the time of commencement of the lease. Accordingly the defendant paid Rs.30,00,000/- to the plaintiff towards security deposit on 19.5.2003. The execution and registration of the lease deed was also contemplated under the agreement dt.19.5.2003. It is further pleaded that the plaintiff's entitlement in the suit B schedule property was 73%. The extent of entitlement of the plaintiff is demarcated in the plans annexed to the agreement. The plaintiff's entitlement is over the suit C schedule property only. It was further pleaded that the development of the suit B schedule property was completed, 7 O.S.No.16735/2005 occupancy certificate was obtained and as decided by the defendant, possession of B schedule property was delivered to the defendant on 15.11.2003. Therefore, the lease in respect of suit B schedule property was commenced with effect from 15.11.2003. Therefore, the defendant is entitled to pay agreed rents from 15.11.2003. Though the lease was commenced from 15.11.2003, the defendant deliberately omitted and neglected its obligation to make payments of rent as agreed as well as payment of the balance security deposit amount in spite of plaintiff's several requests to do so. Therefore, on 20.11.2004, the plaintiff through a letter pointed out the defaults on the part of the defendant and requested the defendant to make payment of the outstanding rentals and balance security deposit. On 24.11.2004 through a letter, the defendant has unequivocally accepted having taken possession of the property and that the lease has consequently commenced on 15.11.2003, but the defendant has sought to disclaim the liability to pay rent on lame and frivolous reasons in spite of that there were no defaults to avoid payment of rents. In fact, so called defaults pleaded as the excuse to avoid payment of rent are at any rate attributable only to M/s.R.R.Constructions and that the plaintiff had no control over any of them. The lame and frivolous excuses resorted to by 8 O.S.No.16735/2005 the defendant did not justify the willful default in payment of rent, much less in respect of suit C schedule property. The defendant attempted to take shelter under the certain provisions of the Hughes Development Agreement to avoid payment of the agreed rent and security deposit amount balance. It is further pleaded that in spite of repeated exhortations of the plaintiff, the defendant has failed to execute and register the lease deed in respect of suit C schedule property of the plaintiff. Therefore, the arrangement will in the eye of law in respect of the suit C schedule property is a month to month tenancy commencing from 15.11.2003 that terminable with issuance of notice of 15 days. Therefore, on 10.1.2005 the plaintiff got issued a legal notice to the defendant terminating the said lease with a request to the defendant to deliver vacant possession of the suit schedule property to the plaintiff on or before 31.1.2005. Therefore, on or after 1.2.2005, the occupation of the suit C schedule property by the defendant is illegal and that it amounts to a trespasser. He cannot continue in occupation of the suit C schedule property and that he is required to hand over physical possession of the suit C schedule property to the plaintiff. It was further pleaded that the defendant wrongfully failed to make payment of the rentals as agreed. As on 10.1.2005, there exists balance of 9 O.S.No.16735/2005 Rs.2, 05,38,322-20 only towards rent dues and there is a balance of Rs.1,80,72,150/- towards balance of security deposit. The defendant is liable to pay the sum with interest at 24% p.a. on the aforesaid amount till its payment. Therefore, the plaintiff is entitled to claim Rs.70,11,004/- from the defendant towards interest on the unpaid security deposit. The defendant is further liable to pay interest at the rate of 24% p.a. on Rs.1, 80,72,150/- from 15.11.2003 till the date of handing over possession of the suit C schedule property. The defendant has accepted its liability to pay the entire monthly rentals and has dispatched to the plaintiff the TDS certificates for the period from 15.11.2003 to 31.3.2005. Further, it was pleaded that the defendant is liable to pay a sum of Rs.1, 17,06,750/- towards the illegal use and occupation of the C schedule property from 1.2.2005 till the date of filing of the present suit. The defendant is also liable to compensate the plaintiff towards the illegal use and occupation of suit C schedule property to the plaintiff. Therefore, the defendant in all is liable to pay Rs.4,51,96, 169/- to the plaintiff with interest at 24% p.a. till the date of payment from the date of this suit. The cause of action for the present suit arose on 15.11.2003 when possession of suit C schedule property was delivered to the defendant and on all 10 O.S.No.16735/2005 dates when the defendant failed to make payment of the rentals in respect of the suit C schedule property and on 10.1.2005 when the legal notice was issued and thereafter when the defendant received the same and failed to comply with the demands of the plaintiff and on 1.2.2005 from which date the possession of the defendant became illegal and unlawful. Therefore, the plaintiff has constrained to file this suit.
3. On service of suit summons, the defendant had put its appearance through its counsel and has submitted its written statement contending that this suit is not maintainable either in law or on facts. The defendant is not a party to the Development agreement dt.3.5.2003 said to have been executed between the plaintiff and M/s.R.R.Constructions. The defendant came to know that M/s.R.R.Constructions was entitled to 4.33 acres in Sy.No.18/1, 18/2, 18/5A and 18/5B along with 1 acre 20 guntas of Kadabeesanahalli in all measuring 6 acres 20 guntas. The defendant has admitted that it was in need of a large development centre. Therefore, the defendant had not only expressed its desire to take on lease the property with certain specifications suitable for its requirement as alleged, but also made it clear to the plaintiff that the land owner M/s.R.R.Constructions to have a right to purchase the property 11 O.S.No.16735/2005 with absolute rights of ownership eventually besides development of the property according to its specifications. Therefore, on 19.5.2003 an agreement for development of land, construction of building and subsequent lease with purchase option to the lessee was entered into and executed between the plaintiff, M/s.R.R.Constructions and the defendant in respect of A schedule property. The plaintiff agreed to develop as stated and both the plaintiff and M/s.R.R.Constructions jointly agreed to deliver a total area of 1,03, 100 sq.ft of built up area to the defendant. But subsequently, an additional extent of 9305 sq.ft of built up area was also agreed to be taken on lease by the defendant. Total area of 1,12,405 sq.ft is mentioned in the suit B schedule property. The plaintiff and M/s.R.R.Constructions jointly agreed to lease the suit B schedule property, but separate areas are not demarcated showing the plaintiff's and M/s.R.R.Constructions area. The entire area of 1,12,405 sq.ft as mentioned in the suit B schedule property is belonging to the plaintiffs and M/s.R.R.Constructions jointly in the ratio of 73:27. The defendant admitted that the proposed lease was initially for a period of 5 years from 30.10.2003 with an option in favour of the defendant to renew the same for a further period of 5 years or expiry of the initial period of 5 years. The defendant also has 12 O.S.No.16735/2005 pleaded that it was agreed between him and the plaintiff as well as M/s.R.R.Constructions that the proposed lease in favour of defendant was to commence after completion of Phase I development and after obtaining occupancy certificate. Therefore, the obligation to pay rent is to commence after completion of Phase-1 Development and after obtaining the occupancy certificate and after possession of Phase I development was handed over to the defendant . The defendant has admitted that it has paid Rs.30,00, 000/- to the plaintiff towards security deposit on 19.5.2003. The said lease in favour of the defendant as agreed by the plaintiff and M/s.R.R.Constructions in respect of plaint B schedule property was jointly owned by them in the ratio of 73 : 27 and that it was as a single and indivisible entity which cannot be split up and not the plaint C schedule property as alleged. The defendant admits that it has taken possession of suit B schedule property on 15.11.2003. Thereafter, the defendant sent e-mail to the plaintiff reminding him about obtaining of the occupancy certificate from the competent authority by 30.11.2003. In the reply e-mail dt.8.12.2003, the plaintiff has confirmed that it would obtain occupancy certificate on or before 30.11.2003. Therefore, payment of rent on the part of the defendant 13 O.S.No.16735/2005 commenced from 15.11.2003 is not correct. Payment of rent would arise in respect of the suit schedule property only after completion of the Phase I development and after obtaining of occupancy certificate and subject to fulfillment of other conditions as stipulated in the agreement. The defendant was willing to pay rent only after execution of the lease deed by the plaintiff and M/s.R.R.Constructions. Though the defendant had sent the signed lease deed for their signature, but the plaintiff and Rani Rasamani have delayed the execution of the said lease deed from time to time on one pretext or the other without any justification. There was no lapse on the part of the defendant with regard to payment of the rent to the plaintiff and M/s.R.R.Constructions. It was further pleaded that the plaintiff is not complying with the terms of the agreement in the matter of completion of construction of Phase I development in all its respects, in obtaining of occupancy certificate in time, in delivering 1 acre 27 guntas and in signing and executing and registering the lease deed in favour of the defendant. Therefore, it was explained to the plaintiff that why the defendant could not effect payment of rent from the date of commencement of lease. The defendant is willing and ready to pay rent and balance security deposit due to the plaintiff as per the terms of the said 14 O.S.No.16735/2005 agreement dt.19.5.2003. The defendant has further pleaded that there was no agreement to pay interest to the plaintiff in respect of any dues payable by it. Issuances of TDS certificates do not take away the rights available to the defendant under the said agreement regarding payment of rent and security deposit. The plaintiff is not entitled to any damages in as much as the possession of the defendant of the demised premises is lawful and it is not illegal and unauthorised. The notice dt.10.1.2005 is illegal, invalid and inoperative. It is settled position of law that any quit notice issued by one of the joint or co-lessors is invalid and the suit based on such notice is not maintainable. The said notice is defective in nature. Only suit C schedule property is not the subject matter of the lease created in favour of the defendant. The suit B schedule property is the subject matter of the lease which is in the name of the defendant. Therefore, notice dt.10.1.2005 is invalid or illegal, cannot be sustained and it is liable to be rejected outright. There is no justification to put an end to the said lease without being joined by its co-lessor M/s.R.R.Constructions. Therefore, defendant is not liable to deliver the vacant possession of the suit B or C schedule property to the plaintiff. There was no cause of action to file this suit. 15 O.S.No.16735/2005 The suit is not properly valued. Therefore, the defendant has sought for dismissal of this suit with costs.
4. Based on the aforesaid pleadings, this Court has framed the following issues:-
1. Whether the defendant proves that the tenancy is a contractual tenancy for a period of five years and that the tenancy has not been validly terminated by notice dt.10.1.2005?
2. Whether the plaintiff proves that the defendant is due and liable to pay arrears of rent and damages as claimed in the plaint?
3. Whether the plaintiff proves that the defendant is liable to pay interest on the delayed payments as claimed in the plaint?
4. Whether the plaintiff proves that it has terminated tenancy in respect of the schedule C property and whether it is entitled to a decree of vacant possession of the suit schedule C property?
5. Whether the plaintiff is entitled to the suit claim?
6. What order or decree?
5. In support of the case of the plaintiff, the plaintiff got examined it's M.D. Sri Raj Menda as P.W.1. It has got exhibited 29 documents as Ex.P-1 to P-29 and closed evidence to substantiate its claim. The defendant examined its Associate 16 O.S.No.16735/2005 Vice President (Administration and corporate facilities) Sri Manoj Kumar Vaish as D.W.1. It has got exhibited 23 documents as Ex.D-1 to D-23 and closed evidence to substantiate its defence. Heard the arguments of the learned counsels appeared for the plaintiff as well as the defendant respectively in length.
6. The learned counsel for the plaintiff has relied the fallowing citations in favour of his arguments for the plaintiff.
(i) AIR 1968 SC 1028 (Kollipara Sriramulu (D) by LRs Vs Aswathnarayana (D) by LRs and others). (ii) 2003(66) DRJ 191 (Sohan Singh and others Vs. State Bank of Patiala). (iii) (1998) 2 SCC 226 (Bismillah Begum V/s Rahmatullah Khan) (iv) AIR 1962 SC 1182 K.Simrathmull's case. ILR 2012 Kar 2388 Kempahanumaih V/s M/s Allied Motors Service Station & others, 2000(6) SCC 394 Antonty V/s K.C.Ittoop & Sons and others, ILR 2013 Kar 3255 M/s Kothary Intergroup Ltd V/s M/s Vinayaka Enterprises, 2010(4) SCC 753 Karam Kapany & others V/s Lalchand public Charitable Trust & another, 2006(1) SCC 228 C.Albert Moris V/s K.Chandrashekaran & others, 2006(4) SCC 205 Swaroop singh V/s J.Jagadeeshsingh & others, 2012(8) SCC 516 Ahmedsab (Dead) by LRs & others V/s Syed Ismail & AR 1963 SC 1405 as well as 2004 (2) SCC 712 FCI V/s Babulal Agarlal. 17 O.S.No.16735/2005
7. In a case reported in AIR 1968 SC 1028 Kollipara Sriramulu's case, at para 3, the Hon'ble Apex Court has held that "It is well settled that a mere reference to a future formal contract will not prevent a binding bargain between the parties. The fact that the parties refer to the preparation of an agreement by which the terms agreed upon are to be put in a more formal shape does not prevent the existence of a binding contract." If the documents or letters relied on as constituting a contract contemplate the execution of a further contract between the parties, it is a question of construction whether the execution of the further contract is a condition or term of the bargain or it is a mere expression of the desire of the parties as to the manner in which the transaction already agreed to will in fact go through. In the former case, there is no enforceable contract either because the condition is unfulfilled or because the law does not recognize a contract to enter into a contract. In the latter case, there is a binding contract and the reference to the more formal document may be ignored. In a case reported in 2003(66) DRJ 191 Sohan Singh's case for ejectment and decree for damages, the Hon'ble Delhi High Court at para 14 has held that "unregistered lease deed executed for 5 years with option to the lessee to renew when no demand for renewal from 18 O.S.No.16735/2005 lessee and no case for specific performance was filed, then the lessee is to be treated as month to month at sufferance whose lease can be terminated by serving a valid notice under Sec.106 of T.P.Act. The Hon'ble Delhi High Court has further held at para 14 that "The matter can be looked at from another stand point also. Since the defendant has neither served a notice or demand seeking execution of an instrument of renewal and due registration thereof, and has also not filed any case for specific performance, therefore defendant is presumed to be happy with resultant status of a tenant at sufferance or a month to month tenant. In a suit filed for specific performance of contract dt.19.2.1948, in a case reported in AIR 1962 SC 1182 K.Simrathmull's case, the Hon'ble Apex Court at para 5 has accepted the majority decision of the Federal Court rendered in Shanmugam Pillai Vs. Annalakshmi (AIR 1950 FC 38) wherein it was held that "where under an agreement an option to a vendor is reserved for repurchasing the property sold by him, the option is in the nature of a concession or privilege and may be exercised on strict fulfillment of the conditions of which it is made exercisable. The Hon'ble Federal Court has further held that "If the original vendor fails to act punctually according to the terms of the contract, the right to repurchase will be lost and cannot be 19 O.S.No.16735/2005 specifically enforced. In a suit filed for specific performance of the agreement. In another case reported in 1998(2) SCC 226 Bismillah Begum's case filed for specific performance of contract dt.8.2.1955, the Apex Court has held that "time is always the essence of contract for reconveyance of the property. Repayment having not been made by the plaintiff within the stipulated time, option of reconveyance in her favour must be deemed to have lapsed." It was further held that "An option for the renewal of a lease, or for the purchase or repurchase of the property, must in all cases be exercised strictly within the time limited for the purpose, otherwise it will lapse..." In a suit for eviction of tenant, the three Judges Bench of the Hon'ble Apex Court in a case reported in 2000(6) SCC 394 Anthony Vs. K.C.Ittoop & Sons and others at paras 8 & 11 has held that "the lease deed relied on by the plaintiff was intended to be operative for a period of five years. It was an unregistered instrument. Hence, it could not create a lease on account of the inhibiting provisions of Sec.107 of the T.P.Act 1882 and Secs 17(1) & 49 of the registration Act, 1908. Therefore, so far as the instrument of lease is concerned there is no scope for holding that the appellant is a lessee by virtue of the said instrument. The Court is disabled from using the instrument as evidence..." At para 16 20 O.S.No.16735/2005 the Hon'ble Apex Court has further held that "Non-registration of the document caused only two consequences. One is that no lease exceeding one year was created. Second is that the instrument became useless so far as creation of the lease is concerned. Nevertheless the presumption that a lease not exceeding one year stood created by conduct of parties remains unrebutted" At para 15 the Hon 'ble Apex Court has held that "When it is admitted that legal possession of the building has been transferred to the appellant, there is no scope for countenancing even a case of licence.." In a suit for recovery of possession and mesne profits, in a case reported in 2012(11) SCC 405 (Manu/SC/0757/2012) Payal Vision Ltd. Vs. Radhika Chowdhary, the Hon'ble Apex Court has held the ratio decidendi that "Tenancy shall be terminated upon service of notice if such notice has not been complied with provisions of law. The Hon'ble Apex Court has further held that in such type of suits "All that is required to be established by the plaintiff-landlord is the existence of jural relationship of landlord and tenant between the parties and the termination of the tenancy either by lapse of time or by notice served by the landlord under Sec.106 of the T.P.Act." In a suit for ejectment, a case reported in ILR 2013 Kar.3255 (Manu/KA/0703/2013) M/s.Kothai Inter group Ltd. Vs. 21 O.S.No.16735/2005 M/s Vinayaka Enterprises, the Hon'ble High Court of Karnataka has held that "When a person is inducted into the premises in consideration of the price to be paid or promised, that is monthly rent creates a jural relationship of lessor and lessee. Termination of such relationship is permissible only as envisaged under Sec.106 of T.P.Act. A person having been inducted as a tenant would continue to be tenant and as envisaged under Sec.116 of T.P.Act, is estopped from contending other wise..." In a suit for possession based on tenancy basis, reported in AIR 2010 SC 2077 (Manu/SC/0240/2010) Karam Kapani and others Vs. Lalchand Public Charitable Trust, at para 20© the Hon'ble Apex Court has held that "It is pertinent to note that u/s.116 of T.P.Act, a tenant is estopped from denying the title of the lessor to the tenanted premises during the continuance of lease..". In a case reported in 2006(1) SCC 228 C.Albert Morris Vs. K.Chandrasekaran and others, the Hon'ble Apex Court has held that "once a notice is served determining the tenancy or showing an intention to quit on the expiry of the period of the notice, the tenancy is at an end, unless with the consent of the other party to whom the notice is given the tenancy is agreed to be treated as subsisting. The receipt of rent may only create a presumption and cannot by its own force amount to a waiver." In a case 22 O.S.No.16735/2005 reported in 2006(4) SCC 205 Sarup Singh Gupta V/s S.Jagadish and others, the Hon'ble Apex Court has held that "Mere fact that rent has been tendered and accepted after service of such notice of termination of lease and before initiation of eviction suit, cannot be determinative. There has to be other evidence to prove or establish that the landlord intended such waive"
8. The learned counsel for the defendant has relied the following citations in favour of his arguments for the defendant.
1994(2) SCC 497 State of Maharastra V/s Athor India Ltd. AIR 1968 SC 496 Tolarave Relumal and another V/s The State of Bombay. 1996(6) SCC 373 S.K.Sattar, SK. K.Mohammed Chowdhuri V/s Gundappa Ambadas Bukate. 2004(2) SCC 712 FCI & others V/s Babulal Agarwal. AIR 2003 SC 578 B.L.Sreedhar and others Vs. K.M.Munireddy. AIR 1968 SC 438, Ms.S.Sanyal V/s Gian Chand. (1977) 4 SCC 324 M/s.Technicians Studio Private Ltd V/s Smt.Lila Ghosh and another. (1973) 1 SCC 273 M/s.Hindustan Steel Limited V/s Smt.Kalyani Banerjee and others 1987(2) SCC 555 Ramswarup Gupta (dead by LRs Vs. Bishun Narain inter college and others and AIR 2015 Karnataka 128 M/s. Auto World, Bengaluru V/s Smt.K.V.Sathyavathi.
9. The Hon'ble Apex Court in a case reported in 1994(2) SCC 497 State of Maharastra case has held that 23 O.S.No.16735/2005 "lease does not include 'agreement to lease' executable at a future date without immediately bringing into effect lessor-lessee relationship and actual demise. Therefore, 'agreement to lease' not subject to stamp duty..." The Hon'ble Apex Court (Five Judges Bench) in a case reported in AIR 1954 SC 496 Tolarave Relumal and other Vs. The State of Bombay at para 6 has held that "an instrument is usually construed as a lease if it contains words of present demise. It is construed as an executing agreement, notwithstanding that it contains words at present demise. Where certain things have to be done by the lessor before the lease is granted, such as the completion or repair or improvement of the premises or by the lessee, such as obtaining sureties it amounted to an agreement to grant a lease in future..." In a case reported in 1987(2) SCC 555 Ramswarup Gupta (dead) by LRs V/s Bishun Narain inter college and others, the Hon'ble Apex Court has held that "pleadings need not contain the exact statutory language or expression in order to attract the statutory provisions. If plea relates to terms and conditions of an oral agreement, absence of written deed of the agreement not fatal to the plea as the terms can be gathered from the circumstances and conduct of the parties. The Hon'ble Apex Court has held that the parties by agreement can make 24 O.S.No.16735/2005 licence irrevocable even if it is not covered by Clause (a) and (b), of Sec.60 of Easements Act, 1882. In a case reported in 1996(6) SCC 373 S.K.Sattar, SK. K.Mohammed Chowdhuri Vs. Gundappa Ambadas Bukate, the Hon'ble Apex Court at para 37 has held that "a co-sharer cannot initiate action for eviction of the tenant from the portion of the tenanted accommodation nor can he be sued for his part of the rent. The tenancy can not be split up either in estate or in rent or in any other obligation by unilateral act of one of the co-owners. If, however, all the co- owners or the co-lessors agree among themselves and split by partition the demised property by metes and bounds and come to have definite, positive and identifiable shares in that proper, they become separate individual owners of each severed portion and can deal with that portion as also the tenant thereof as individual owner/lessor.." In a case reported in 2004(2) SCC 712 FCI & others Vs. Babulal Agarwal at para 7 it was held that "Even a monthly lease may last for more than a year and for any longer period. In the absence of lease deed or registered lease deed, the nature of the lease would be only be that a monthly lease.."
The Hon'ble Apex Court at paras 8 and 10 has further held that "agreement for securing another agreement or deed in future for the creation of the rights (lease in this case) in immovable 25 O.S.No.16735/2005 property is not a document which compulsorily requires registration. It is an executory agreement by which no right in the property created prasenti. At para 7 the Apex Court has further held that "According to which the parties had to execute a registered lease deed but the same was never done. We find that the High Court has rightly dealt with the question while holding that the plaintiff had not filed the suit for enforcement of agreement of lease. It was suit filed for damages for the breach of contract. It was not a suit for specific performance of the contract. A promise was definitely held out by the defendant to the appellant for occupying the premises for a period of three years at a given rate of rent. The premises were in fact constructed in accordance with the instructions and specifications of the defendant. Therefore, the Hon'ble Apex Court has held that "non execution of the contract in terms of Article 299 of the COI does not militate against the applicability of the doctrine of promissory estoppel against the Government. The proposition of liability of a party on backing out of a promise held out, after making the other party alter his position. In a case reported in AIR 2003 SC 578 B.L.Sreedhar and others Vs. K.M.Munireddy the Hon'ble Apex Court has held that "Though estoppel is described as a rule of evidence, it may have the effect of creating 26 O.S.No.16735/2005 substantive rights as against the person estopped and that therefore it is capable of enforced or defended as against the person precluded from denying it..." The 3 Judges Bench of the Hon'ble Apex Court in a case reported in AIR 1968 SC 438, Ms.S.Sanyal Vs. Gian Chand at para 3 and 6 has held that "The contract of tenancy is a single and indivisible contract, and in the absence of any statutory provision to that effect it is not open to the Court to divide it into two contracts - One of letting for residential purposes and the other for non-residential purposes, and to grant relief to the landlord under Sec.13(1)(e) of Delhi and Ajmer Rent Control Act limited to the portion of the demised property which is being used for residential purposes. The Hon'ble Apex Court in (1973) 1 SCC 273 M/s.Hindustan Steel Limited Vs. Smt.Kalyani Banerjee and others case has held that possession of lessee's land by A - lessee failing to conclusively prove original lessor's proprietory rights - whether A's possession can be disturbed in the circumstances. The Hon'ble High Court of Karnataka in a case reported in AIR 2015 Karnataka 128 (M/s.Auto World, Bengaluru Vs. Smt.K.V.Sathyavathi) has held that if a lessee or under-lessee of property remains in possession thereof after the determination of the lease granted to the lessee, and the lessor or his legal representative accepts rent 27 O.S.No.16735/2005 from the lessee or under-lessee, or otherwise assents to his continuing in possession, the lease is in the absence of an agreement to the contrary, renewed from year to year, or from month to month, according to the purpose for which the property is leased, as specified in Sec.106. The Hon'ble High Court has further held that earlier notice issued for termination of tenancy stood waived if the second notice of the tenancy is issued. In this case our Hon'ble High Court has relied on the judgment of the Federal Court in a case reported in AIR 1949 FC 124.
10. As per Sec.105 of T.P.Act, " a lease of immovable property is a transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms". The transferor is called the lessor, the transferee is called the lessee. The price is called the premium and the money, share, service or other thing to be so rendered is called the rent. Synopsis:- 9 of the said Section of the Transfer of Property Act, 1882 published by Choudhary publication during the year 1999 discloses that '' under the general law, if a lessee governed by the Transfer of 28 O.S.No.16735/2005 Property Act, more often called a tenant, continues in possession of the lease-hold, after the tenancy is terminated, he may be called a 'tenant holding over', if the lessor or his legal representative accepts rent from him or otherwise assents to his continuing in possession and he becomes a month to month tenant. If a tenant remains in possession after the determination of the lease, the common law rule is that he is a tenant on sufferance. A distinction should be drawn between a tenant continuing in possession after the determination of the term with the consent of the landlord and a tenant doing so without his consent. The former is a tenant at sufferance in English Law and the latter a tenant holding over or a tenant at will. In view of Sec.116 of T.P.Act, a lessee holding over is in a better position than a tenant at will. The assent of the landlord to the continuance of possession after the determination of the tenancy will create a new tenancy. What the section contemplated is that on one side there should be an offer of taking a new lease evidence by the lessee or sub-lessee remaining in possession of the property after his term was over and on the other side there must be a definite consent to the continuance of possession by the landlord expressed by acceptance of rent or otherwise. On termination of lease, if the tenant's continuance is not by the 29 O.S.No.16735/2005 assent of the lessor, he is merely a tenant at sufferance. The tenancy at sufferance is not a right at all. Continuance of possession of a tenant at sufferance though wrongful, such possession by itself does not become adverse to the lessor. As per Sec.106 of T.P.Act, in the absence of a contract or local law or usage to contrary, a lease of immovable property for agricultural or manufacturing purpose shall be deemed to be a lease from year to year, terminable, on the part of either lessor or lessee, by six month's notice expiring with the end of a year of the tenancy; and a lease of immovable property for any other purpose shall be deemed to be a lease from month to month, terminable, on the part of either lessor or lessee, by 15 days notice expiring with the end of month of the tenancy. Sec.107 of T.P.Act provides that a lease of immovable property from year to year, or for any term exceeding one year or reserving a yearly rent, can be made only by a registered instrument. All other lease of immovable property may be made either by a registered instrument or by oral agreement accompanied by delivery of possession. Sec.109 of T.P.Act provides that if the lessor transfers the property leased, or any part thereof, or any part of his interest therein, the transferee in the absence of a contract to the contrary, shall possess all the rights, an if the lessee so 30 O.S.No.16735/2005 elects, be subject to all the liabilities of the lessor as to the property or part, transferred so long as he is the owner of it, but the lessor shall not by reason only of such transfer ceases to be subject to any of the liabilities imposed upon him by the lease, unless the lessee elects to treat the transferee as the person liable to him provided that the transferee is not entitled to arrears to rent due before the transfer, and that, not having reason to believe that such transfer has been made, pays rent to the lessor, the lessee shall not be liable to pay such rent over again to the transferee. The lessor, the transferee and the lessee may determine what proportion of the premium or rent reserved by the lease is payable in respect of the part so transferred, and, in case they disagree, such determination may be made by any Court having jurisdiction to entertain a suit for the possession of the property leased. Sec.111 of T.P.Act provides that a lease of immovable property determines (a) by efflux of the time limited thereby, (b) where such time is limited conditionally on the happening of some event - by the happening of such event, (c) where the interest of the lessor in the property terminates on or his power to dispose of the same extends only to, the happening of any event - by the happening of such event, (d) in case the interest of the lessee and the lessor in the whole of the property 31 O.S.No.16735/2005 become vested at the same time in one person in the same right,
(e) by express surrender, that is to say, in case the lessee yields up his interest under the lease to the lessor, by mutual agreement between them, (f) by implied surrender, (g) by forfeiture (h) on the expiration of a notice to determine the lease, or to quit, or of intention to quit, the property leased, duly given by one party to the other. Sec.112 of T.P.Act provides that a forfeiture under Sec.111, clause (g) is waived by acceptance of rent which has become due since the forfeiture, or by distress for such rent, or by any other act on the part of the lessor showing an intention to treat the lease as subsisting provided that the lessor is aware that the forfeiture has been incurred, provided further, that where rent is accepted after the institution of a suit to eject the lessee on the ground of forfeiture, such acceptance is not a waiver. Sec.113 of T.P.Act provides that a notice given under Sec.111, Clause (h) is waived, with the express or implied consent of the person to whom it is given, by any act on the part of the person giving it showing an intention to treat the lease as subsisting. Synopsis to Sec.4 of 113 provides that on this question the majority view is that acceptance of rent during the pendency of suit for ejectment does not amount to waiver of 32 O.S.No.16735/2005 eviction notice. If the ejectment suit is actively prosecuted mere acceptance of rent does not amount to waiver.
11. Perused the facts and circumstances of this case and the facts and circumstances with the ratio of law laid down in the aforesaid reported cases. Perused the plaint, WS, evidence placed before the Court by both parties to this suit. Perused the arguments urged by both the sides before this Court.
12. My answer to the aforesaid issues is as follows:-
Issue No.1 : As in the negative.
Issue No.2 : As in the affirmative.
Issue No.3 : As partly in the affirmative.
Issue No.4 : As in the affirmative.
Issue No.5 : As partly in the affirmative.
Issue No.6 :As per final order for the following :-
REASONS
13. Issues No.1 and 4 :- These issues are inter linked with each other. Therefore, these issues are taken up together for joint discussion to avoid repetition of facts. It is the case of the defendant that tenancy is a contractual tenancy for a period of five years and that it has not been validly terminated by notice dated 10-01-2005. It is the case of the plaintiff that it has validly 33 O.S.No.16735/2005 terminated the said tenancy and that therefore the plaintiff is entitled to a decree of vacant possession of the suit C schedule property. In the oral evidence of PW-1 and DW-1 that recorded during the course of their respective chief-examination, they have specifically reiterated their pleadings once again before this Court.
14. Ex P-1, the extract of the minutes of the board of directors of the plaintiff company dtd.03.12.2004, discloses that the plaintiff company has decided to initiate appropriate legal proceedings against the deft. Company for eviction and recovery of rent and future damages in respect of the suit C.Schedule properties. The said documents further discloses that 1)Mr.Arjun Menda, M.D, 2)Raj Menda, Director & 3) Manoj Menda, the director the plaintiff company are the authorized persons to sign and to do all acts which are required in relation to the legal proceedings initiated or to be initiated from time to time. Ex.P-2, the copy of development agreement dt.3.5.2003 discloses that the plaintiff and Rani Rasamani constructions Pvt Ltd have entered into an agreement agreeing to jointly develop the suit A schedule property of this suit. The said document further discloses that the plaintiff and the Rani Rasamani constructions Pvt Ltd have agreed to share the saleable area in the buildings 34 O.S.No.16735/2005 and the benefit of the development in the suit A and B schedule properties in the ratio of 73:27. The contents of Ex.P-2 agreement are not in dispute between the parties to this suit. Ex.P-4 the copy of sale deed dt.13.5.2004 discloses that the M/s Rani Rasamani Constructions Pvt Ltd. has sold Suit-C schedule property to the plaintiff.
15. As per Clause 1.1 of Ex.P-3, the plaintiff and M/s Rani Rasamani Constructions Pvt Ltd are agreed that the phase- 1 development will be constructed on or before 30.10.2003 strictly in accordance with the sanctioned plans and in compliance with all laws, statutes, ordinances, administrative orders or Governmental rules, regulations and requirements of any duly constituted public authority having jurisdiction. Clause 2 of the said agreement provides that the plaintiff and M/s Rani Rasamani Constructions Pvt Ltd are agreed to deliver vacant and physical possession of the Phase- 1 development to the defendant on or before 30.10.2003 and that the lease for Phase- 1 development shall commence from 30.10.2003. As per Clause 2.1 of Ex.P-3 initial lease of the suit B schedule property is for a term of 5 years from 30.10.2003 with a sole and exclusive option to the defendant to renew the same for a further term of 5 years immediately following the initial 5 year term on the same terms 35 O.S.No.16735/2005 and conditions stated in the said document. The said Clause further discloses that if delay in delivery of completed Phase-1 development on or before 30.10.2003, the commencement date shall commence on such other date as the defendant may at its option, accept the vacant and physical possession of the completed Phase-1 development and accordingly the ensuing 5 year lease term shall be computed for such new date without prejudice to any of its other rights. The said Clause further discloses that during the entire term of the said lease, the defendant shall have the exclusive use and enjoyment of the remaining land in suit schedule property duly landscaped as per defendant's requirements. Clause 2.3 provides that the defendant shall deposit at the time of execution of the lease deed with the plaintiff and M/s Rani Rasamani Constructions Pvt Ltd an interest free security deposit equivalent to fifteen months rent, refundable at the expiry of the lease or on it's sooner determination. Clause 2.4 of Ex.P-3 provides that there shall be a lock-in period of first 4 years of the lease term, during which time plaintiff shall not terminate the said lease. The said lock in term for 4 years shall not apply in the event defendant elects to exercise its option to purchase as per the terms of the said contract. The defendant may at its option terminate the lease at 36 O.S.No.16735/2005 any time after the lock-in time by giving 3 months notice in writing. Clause 3.1 (b) of Ex.P-3 agreement provides that the defendant and M/s Rani Rasamani Constructions Pvt Ltd are agreed and undertaken to obtain conversion of 1 acre 27 guntas in land No.20/3 from agriculture to non-
agricultural purposes and permission for conversion from residential to industrial software purpose before commencement of the lease. Clause 3.1(b) provides that change of land use from residential to industrial software purpose shall be made within a period of 1 ½ years from the date of commencement of lease. Clause 4 of Ex.P-3 agreement provides that the defendant shall deposit with the 1st defendant a sum of Rs.30, 00,000/- at the time of signing on Ex.P-3 document. Clause 4.2 of the said agreement provides that the said Rs.30,00,000/- shall be applied towards part of the security deposit payable by the defendant as provided under Clause 2.3. Clause 4.3 of Ex.P-3 provides that the defendant shall pay the balance amount of the security deposit at the time of commencement of the lease. Clause 5 of the said agreement provides that if the lease of the suit B schedule property does not commence on 30.10.2003 on account of failure of the plaintiff and M/s Rani Rasamani 37 O.S.No.16735/2005 Constructions Pvt Ltd to complete phase-1 development or to obtain the occupancy certificate, the plaintiff may at its sole and exclusive option to terminate the agreement by way of issuing notice in writing and on such termination, the plaintiff and M/s Rani Rasamani Constructions Pvt Ltd shall refund to the defendant all monies received under the Ex.P-3 agreement together with interest at the rate of 24% p.a. As per Clause 5. 2 to 4 if the plaintiff and M/s Rani Rasamani Constructions Pvt Ltd fail to obtain conversion in respect of 1 acre 27 guntas of land comprising Sy.No.20/3 and vesting of the title, change of land use within time stipulated in Clause 3.1(a) & (b) before commencement of the lease, payment of the rent, the security deposit amount and the price payable in respect of 1 acre 27 guntas of land in Sy. N0. 20/3 that is payable by the defendant shall stand reduced by 50% until the plaintiff and M/s Rani Rasamani Constructions Pvt Ltd shall obtain the conversion of the land in Sy.No.20/3. Clause 12 of Ex.P-3 provides that upon completion of Phase-1 development, the plaintiff, M/s Rani Rasamani Constructions Pvt Ltd and the defendant are agreed to execute and register at the cost of the defendant, a Deed 38 O.S.No.16735/2005 of lease in favour of the defendant in the form Annexure- 6 and on the terms and conditions set out therein and that the lease deed format shall not be altered or modified except by mutual consent. Clause 15 of Ex.P-3 provides that without prejudice to the lease arrangements as mentioned above and in consideration of the defendant agreeing to take Phase-1 development on lease, the defendant shall also have the option and right to purchase the suit A schedule property with the buildings and improvements free and clear of all lien, charges and encumbrances at the price agreed therein. This sole and exclusive option to purchase shall remain valid and exercisable from the 2nd anniversary of the lease up to and inclusive of the 6th anniversary day. Clause 15.1 of the said agreement provides that the purchase option may be exercised by the defendant by giving written notice to the plaintiff and M/s Rani Rasamani Constructions Pvt Ltd of its intention to exercise its option and specify in the said notice the date and time when the sale price collected will be tendered to them. In that event, the defendant decides to exercise the purchase option, the price payable for free and clear title to suit A schedule property and Phase-1 development shall be collected (a) or the land at the rate of 39 O.S.No.16735/2005 270/- per sq.ft with increase at 12% for the building excluding service area including plinth area at the rate of 1.627.50 per sq.ft and for the service area situated in the basement of A block at the rate of Rs.545.50 per sq.ft. Clause 15.2 provides that if the purchase option is exercised after any further construction of the buildings on the remaining land in the A schedule property, the rates for the building is Rs.1100/- per sq.ft and Rs.220/- for phase I development and Rs.37.50 sq.ft. for additional development and the same be decsided through mutual consent between the plaintiff , M/s Rani Rasamani Constructions Pvt Ltd and the defendant and if they failed to mutually agreed, then the increase payable for development shall be determined by the Indian Project management expert C.B.Richard Ellis South Asia private limited. Clause 15.3 provides that sale price calculated as option shall be reduced by the security deposit due to plaintiff and M/s Rani Rasamani Constructions Pvt Ltd under the lease deed and the sum total holding cost received by plaintiff and M/s Rani Rasamani Constructions Pvt Ltd as per Clause 15.4 of the Agreement. Clause 15.4 of the suit agreement provides that "in consideration of the purchase option to the defendant, the defendant shall pay each month to the M/s Rani Rasamani Constructions Pvt Ltd holding cost of Rs.2,16,000/- until 40 O.S.No.16735/2005 defendant exercises the purchase option or until the expiry of 6 years whichever is earlier unless before the expiry of 6 years, the defendant shall have decided not to exercise the purchase option in which event the obligation to pay the holding cost shall cease from such date as the defendant shall communicate in writing to the plaintiff and M/s Rani Rasamani Constructions Pvt Ltd its decision not to exercise the purchase option". In the event the defendant exercising the purchase option, the holding cost paid to the plaintiffss and M/s Rani Rasamani Constructions Pvt Ltd until the exercise of the purchase option shall be set off towards a part of the sale price. In the event of defendant not exercising purchase option, the plaintiff and M/s Rani Rasamani Constructions Pvt Ltd shall after expiry of the above 6 years period, the Phase-I development and remaining land in such manner as they may deem it fit and the plaintiff and M/s Rani Rasamani Constructions Pvt Ltd shall be entitled to retain the entire amount received by them towards holding cost till then and shall be under no obligation to refund any portion of the same to the defendant. Clause 15.5 provides that the plaintiff and M/s Rani Rasamani Constructions Pvt Ltd shall execute one or more Deed or Deeds of sale conveying the schedule A property with Phase I development and all other 41 O.S.No.16735/2005 developments and improvements to the defendant or any of its nominee or nominees and admit execution of the Deed or Deeds of sale before the registration authorities. Upon the execution and registration of the Deed of sale, the lease of Phase I development shall determine absolutely and Hughes obligation to pay the rent shall cease. As per Clause 15.6 the defendant shall have all the rights to enforce specific performance of the purchase option in a Court of law of appropriate jurisdiction and if the plaintiff and M/s Rani Rasamani Constructions Pvt Ltd fail or neglect to perform their obligations under the plaintiff's purchase option. Clause 17 of Ex.P-3 provides that subject to the survival clause 18 below, unless terminated earlier by the defendant, this Agreement shall remain in force from the date of its execution until (i) construction of Phase I development is completed, (ii) possession of Phase I is handed over to plaintiff as per the terms of this Agreement, (iii) the commencement of the lease and the execution and registration of the lease deed and (iv) If defendant issues a written notice of termination, until return to defendant of the funds pursuant to clause 5. Clause 18 of the said agreement provides that Clauses 5, 4, 15, 15.1, 15.2, 15.3, 15.4, 15.5, 15.6, 15.7, 16, 16.1, 21 and 22 shall survive the execution of the lease deed by the plaintiff and M/s Rani Rasamani Constructions Pvt 42 O.S.No.16735/2005 Ltd in favour of defendant until the expiry of original term of the lease and the first one year of the renewed term or the exercise by defendant of its purchase option and consequent execution and registration of the Deed of sale in favour of defendant whichever is earlier. Clause 19 provides notwithstanding the foregoing, all representations, warranties and indemnifications made by the defendants in Ex.P-3 shall survive the termination of the suit Agreement.
16. Ex.P-4 the CC of the sale deed dtd.13-05-2004 discloses that M/s Rani Rasamani Constructions Pvt Ltd has executed the said sale deed in favour of the plaintiff in respect of sale of suit C Schedule property. Admittedly, the suit C schedule property is 73% the plaintiff's share in the suit A schedule property. The said document further discloses that the suit schedule property is shown as blue colour in the sketch annexed to the said sale deed. As per Ex P-4 sale deed , the plaintiff has purchased the entire suit C schedule property in the year 2004 from the M/s Rani Rasamani Constructions Pvt Ltd.In the written statement, the defendant has admitted that the plaintiff is the owner of the suit C schedule property. The Ex P-5, the letter dtd.22-05-2003 of the defendant company addressed to the plaintiff company discloses that the defendant company had 43 O.S.No.16735/2005 expressed its intention to take 9,305 sq.ft of land also out of 1,12,405 sq. ft of land and that therefore the deft has requested the plaintiff company to its acceptance of the said proposal. Ex P-6 the letter dtd.20.11.2004 addressed to the defendant Company discloses that the plaintiff company had demanded the deft company to pay Rs.14, 04,810-00 per month to it towards rent in respect of suit C-Schedule property for the period from 15-11-2003 till 30-11-2003 with interest and balance security deposit amount. The said document further discloses that the plaintiff company instructed the deft. Company that if the deft company fails to comply with the terms of the said document, than the plaintiff company shall take recourse to all appropriate legal action including termination of the lease at the defts risk as to the cost and consequences thereof. Ex.P-7 the letter dtd.24- 11-2004 of the deft company addressed to the plaintiff company discloses that the deft had admitted that it has been possession of the 4.33 acres of land in Sy. No.18/1, 18/2, 18/5A and 18/5B of Kadabeesanahalli Village from 15-11-2003 in terms of the agreement marked as Ex P-3. The said letter further discloses that the deft company justified the withhold of rent due to plaintiff and M/s Rani Rasamani Constructions Pvt Ltd on the ground that they had not complied the clauses 3.1(a) 44 O.S.No.16735/2005 3.1(b), 5.2 & 5.3 of the Ex P-3. Ex P-8 the letter dtd.06-01- 2005 of the deft company addressed to the plaintiff company discloses that the deft company had sent TDS certificate against TDS deducted on rent during the financial year 2003-2004. TDS certificate annexed to Ex P-8 discloses that Rs.3,26,384-00 has been deducted towards amount of income tax for the period from 01-04-2003 to 31-03-2004 in respect of the plaintiffs income tax account and that the said amount is deposited to the Central Govt. Account at HDFC Bank Ltd, M.G.Road, Bangalore. Ex P-9, the letter dtd.25-05-2005 of the defendant company addressed to the plaintiff company discloses that the defendant company had sent TDS certificate against TDS deducted on rent during the financial year 2004-2005. TDS certificate annexed to Ex P-9 discloses that Rs.8,79,231-00 has been deducted towards amount of income tax for the period from 01-03-2005 to 31-03- 2005 in respect of the plaintiffs income tax account and that the said amount is deposited to the Central Govt. Account at ICICI Bank Ltd, M.G.Road, Bangalore. Ex P-10, the letter dtd.31.10.2006 of the deft company addressed to the plaintiff company discloses that the deft company had sent TDS certificate against TDS deducted on rent during the financial year 2005-2006. TDS certificate annexed to Ex P-1 discloses that 45 O.S.No.16735/2005 Rs.2,23,365-00 has been deducted towards amount of income tax for the period from 01-06-2005 to 30-06-2005 in respect of the plaintiffs income tax account and that the said amount is deposited to the Central Govt Account at ICICI Bank Ltd, M.G.Road, Bangalore. Ex P-11 the copy of the legal notice dtd.10-01-2005 discloses that the plaintiff company had issued the said legal notice to the deft. Company through its advocate determining the defdts month to month tenancy in respect of the Suit C Schedule property with the month ending on 31-01-2005.
The said document had further discloses that the plaintiff company had called upon the deft company to pay
Rs.2,86,52,413-20 towards rent dues within 21 days from the date of receipt of the said notice. Ex P-12 the letter of postal dept dtd.16-03-2005 discloses that the notice issued as per Ex P- 11 to the deft has been served on 17-01-2005. Ex P-13 letter dtd.19-08-2011 of the India Bulls Company to the plaintiff companies managing director Raj A Menda stating that documents marked as per Ex P-2 & Ex P-3 and Ex P-4 as well as the letter dtd.22-05-2008 are all in its possession. Ex P-14 the notes to the financial statement of the deft. Company discloses that the deft company is liable to pay Rs.59.300.548/- and etc. to the Plaintiff Company and M/s Rani Rasamani Constructions Pvt 46 O.S.No.16735/2005 Ltd. Ex P-15 the CC of the lease deed dtd.31-03-2006 discloses that the plaintiff, Primal projects Pvt ltd and Accenture services Pvt ltd. are all have entered in to the said document in respect of a portion of land measuring 27 Acres 15 guntas of Bellandur Village, Bengaluru East Tq. Ex.P-16, copy of the e-mail letter dt.10.8.2004 addressed to the defendant by the plaintiff discloses that he has suggested draft of the letter for approval and necessary action at the plaintiff's end. The said e-mail also shows the statement showing the amounts due to RRCL as on the date. Ex.P-17, letter address to Manoj discloses that draft lease and development agreement was sent after discussions with RRCL. Ex.P-18, letter dt.31.10.2006 addressed to RRCL by the plaintiff that the defendant has not received duly signed lease deed from RRCL. The said letter also further discloses that 27% of the RRCL rent amount is Rs.73,99,372/- from 15.11.2003 till 30.9.2006 and that the defendant has deducted Rs.34,95,235/- as TDS and that the defendant is liable to pay balance amount of Rs.39,04,137/- towards rent dues and Rs.20,19,825/- towards refundable security deposit amount. Accordingly the defendant has sent two cheques for the said amounts to the said RRCL. Ex.P-19 letter addressed to the plaintiff of this case by the defendant dt.28.12.2004 discloses that the defendant requested 47 O.S.No.16735/2005 the plaintiff to file a comprehensive Writ petition against the acquisition of several items of land pertaining to the plaintiff company. The defendant also has intimated to the plaintiff that in view of supplemental agreement remains unexecuted the defendant has not been able to release the arrears of rent and security deposit and that therefore the defendant has requested the plaintiff to sign on the agreement subject to outcome of the writ petitions. Ex.P-20, letter dt.2.11.2006 addressed to the plaintiff by the defendant discloses that the defendant has sent a cheque valued at Rs.54, 45,216/- to the plaintiff being the 73% of the holding cost at the rate of Rs.2,16,000/- per month from 15.11.2003 till 30.9.2006. Ex.P-21 and 22, official memorandums dt.20.9.2003 discloses that Government of Karnataka has proposed to acquire 1 acre 4.5 guntas of land in the land bearing Sy.No.20/3 of Kadubeesanahalli village, 8¾ guntas in Sy.No.20/1, 11 guntas in Sy.No.20/2, 10¾ in Sy.No.20/2 and 11 guntas in Sy.No.20/3, totally 1 acre 1 ½ guntas of Kadubeesnahalli. Ex.P-23 and 24, official memorandums dt.31.12.2003 discloses that the Government of Karnataka has proposed to acquire 1 acre 1 ½ guntas of land and 1 acre 2 guntas of land in the lands bearing Sy.No.20/1B, 20/2A, 20/2B and 20/3 of Kadubeesanahalli village. Ex.P-25, notification 48 O.S.No.16735/2005 dt.9.3.2004 discloses that 8 acres 11 guntas of land has been acquired in Sy.No.18/2, 19/1, 20/1A, 20/1B, 20/2A, 20/2B, 20/3 and 20/4 of Kadubeesanahalli. Ex.P-26 to 28, copy of the gazette notifications supports the contents of Ex.P-25. Ex.P-29 endorsement dt.19.1.2013 issued by the KAIDB, Bengaluru to the plaintiff discloses that it has furnished the copy of the gazette notifications to the plaintiff as per Ex.P-25 to 28.
17. Ex.D-1, copy of the letter dt.13.9.2002 of the defendant addressed to the plaintiff discloses that the defendant is intending to take 9 acre of land in Sy.No.18/1, 18/2, 18/5A, 18/5B, 20/1A, 20/1B, 20/2 and 20/3 of Kadubeesanahalli on lease for the establishment of its IT industry at B'Luru. Ex.D-2, copy of another e-mail addressed to Ashish Mehrotra from Ram Chandnani discloses that if 1.1 acres of land out of 9 acres is not registered after the 1st 250,000 sq.ft of built up area, RMZ are willing for the rentals to be reduced by 50%. The payment of security deposit is as follows : 50% on land being cleared, 10% when structure is complete, 40% on position of building, Time- lines commence construction by 15th February and OC to be obtained by 30th June. HSS could have the facility in May for fitouts and move in by July 15th. Ex.D-3, Copy of another e-mail addressed to Manoj Menda from S.Basavaraj discloses that the 49 O.S.No.16735/2005 plans are ready for sanction by the BDA if no proposals of amendments made. The said document further discloses that the purchase option for the defendant will be after a period of 2 years and within the first term of lease of 4 years. Ex.D-4 and 5 copies of e-mail addressed to Tejasvi from Manoj Menda. The same discloses that there was a negotiation between the plaintiff and the defendant about drawings of the building. Ex.D.6 to D- 22 are the letters made in between the plaintiff and the defendant about furnishing outfits to the suit C schedule property at the cost of the defendant. Ex.D-23 is the copy of the order sheet dt.3.11.2009 passed in W.P.9040/2005 (LA-KIADB) c/w. WP Nos.9041/2005 to 9043/2005 (LA-KIADB). The said document discloses that the Hon'ble High Court of Karnataka was allowed the said writ petitions and that the final notification dated 7.9.2004 has been set aside. The petitioners/land owners shall appear before the Land Acquisition Officer on 23.11.2009 at 3 pm and file their objections if any. The said document further discloses that the LAO shall provide a fair and reasonable opportunity to the petitioners to have their say in the matter and consider the objections to be filed by them in accordance with law. The said writ petitions are filed challenging the acquisition 50 O.S.No.16735/2005 proceedings in respect of the afore stated lands of Kadubeesnahalli village.
18. About his readiness and willingness about the terms of Ex P-3, the D.W.1, during the course of his cross-examination, has deposed as under :-
"£ÁªÀÅ zÁªÉ ¸ÀévÀÄÛ ¸Áé¢üãÀ ¥ÀqÉAiÀÄĪÀ ¥ÀǪÀðzÀ°è ªÁ¢UÉ £ÉÆAzÁ¬ÄvÀ °Ã¸ï rÃqï §gÉzÀÄ PÉÆqÀÄ JAzÀÄ MvÁ۬ĹzÉÝêÉ. £ÁªÀÅ ¸Áé¢üãÀ ¥ÀqÉAiÀÄĪÀ ¥ÀǪÀðzÀ°è £ÉÆAzÁ¬ÄvÀ rÃqï ªÀiÁqÀĪÀÅzÀÄ condition precedent DVvÀÄÛ. ¤¦.3 gÀ°èAiÀÄ PÁèeï £ÀA§gÀÄ 5 ªÀÄvÀÄÛ 5.01gÀ°è PÁtô¹zÀ £ÀªÀÄä ºÀPÀÄÌUÀ¼À£ÀÄß £ÁªÀÅ dÁjUÉƼÀ¹®è .."
At page 8 & 9, the Dw-1 has deposed as under :
"¢£ÁAPÀB A.15-11-2003 gÀAzÀÄ zÁªÉ ¸ÀéwÛ£À
¸Áé¢Ã£ÀªÀ£ÀÄß £ÁªÀÅ ¥ÀqÉ¢zÉÝÃªÉ JAzÀgÉ ¤d. CzÉÃ
¢£ÁAPÀ¢AzÀ £ÁªÀÅ zÁªÉ ¸ÀéwÛUÉ ¨ÁrUÉ PÉÆqÀ®Ä M¦àzÉݪÀÅ. £ÁªÀÅ ¸Áé¢Ã£À ¥ÀqÉAiÀÄĪÀ ¥ÀÅiÀÁªÀðzÀ°è £ÉÆÃAzÁ¬ÄvÀ rÃqï ªÀiÁqÀĪÀÅzÀÄ PÀArõÀ£ï ¦æ¹qÉAmï DVvÀÄÛ..."
51 O.S.No.16735/2005At page 13 & 14, the Dw-1 has deposed as under :
"¢B 15-11-2003 gÀ ¥ÀǪÀðzÀ°è £ÁªÉãÀÆ ªÁ¢ ªÀÄvÀÄÛ DgïDgïE gÀªÀjUÉ °Ã¸ï rÃqïUÉ ¸À» ªÀiÁrPÉÆr JAzÀÄ PÉüÀ°®è. DPÀÄÌ¥É¤ì ¸Ànð¦PÉÃmï ºÁdgÀÄ ¥Àr¸ÀzÉ EzÀÄÝzÀjAzÀ £ÁªÀÅ °Ã¸ï rÃqï §gÉzÀÄPÉÆqÀĪÀÅ¢®è JAzÀÄ ªÁ¢UÁUÀ° CxÀªÁ DgïDgïE EªÀjUÁUÀ°Ã ¢£ÁAPÀB 15-11-2003 gÀ ¥ÀǪÀðzÀ°è £ÁªÉãÀÆ °TvÀªÁV DUÀ°Ã, FªÉÄÃ¯ï ¸ÀAzÉñÀzÀ ªÀÄÆ®PÀªÁUÀ°Ã w½¹®è. ªÁ¢ K£ÀÄ £ÀªÀÄUÉ zÁªÉ ¸ÀéwÛ£À ¸Áé¢Ã£ÀªÀ£ÀÄß ¢£ÁAPÀB 15-11-2003 gÀAzÀÄ vÉUÉzÀÄPÉƽî JAzÀÄ PÀA¥É¯ï ªÀiÁr®è..."
At page 15 to 17 & 23, the DW-1 has deposed as under :
"We took the possession of the suit schedule property as a bear shall on 15-11-2013. I also agree that it should be given as bear shall. I agree that we are supposed to fit out the premises to make it usable.
As per Ex P-3 we had an option to take out all the fit outs with us if lease is terminated. Cafeteria 52 O.S.No.16735/2005 constructed by us is a temporary structure. In the month of Sept 2004 we sought for modification of the some of the terms of the draft lease deed. The D.W.1 has further deposed at page 28 & 29 and 26 as under:-
"I was aware of the fact that holding costs should be paid before exercising purchase option.
After filing O.S.16735/2005, we have taken necessary action to get the lease deed executed. We did not file any suit against the defendants to get the lease deed executed. It is true that a part of schedule A property shown in this plaint was acquired by KIADB".
About performance of his obligation under Ex P-3, the P.W.1 has deposed as under :-
"µÉqÀÆå¯ï © LlA £ÀA§gï 1 ¸ÀévÀÄÛ 1 JPÀgÉ 27 UÀÄAmÉUÉ gÁtô gÀ¸ÀªÀÄtô EªÀgÀÄ EA¢£ÀªÀgÉUÀÄ ªÀiÁ°ÃPÀvÀé ºÉÆA¢®è JAzÀgÉ ¤d. F ªÀgÉUÀÆ © ¥ÉëqÀÄå¯ï£À LlA £ÀA§gï 1 ªÀÄvÀÄÛ 2 ¸ÀévÀÄÛU¼À À£ÀÄß gÁtô g¸ÀÀªÀÄtô EªÀgÀÄ PÀæAiÀĪÀiÁr PÉÆAr®è JAzÀgÉ ¤d. F ªÀgÉUÀÆ ¥ÀæwªÁ¢AiÀÄ ¥ÀgÀªÁV £ÁªÀÅ £ÉÆAzÁ¬ÄvÀ °Ã¸ï CVæªÉÄAmï §gÉzÀÄ 53 O.S.No.16735/2005 PÉÆlÖ®è JAzÀgÉ ¤d. gÁtô gÀ¸ÀªÀĤ EªÀgÀÄ 1 JPÀgÉ 27 UÀÄAmÉ d«ÄãÀÄ RjâªÀiÁrPÉÆAqÀÄ ¨ÀsÆ ¥ÀjªÀvÀð£É ªÀiÁrzÀ £ÀAvÀgÀ °Ã¸ï CªÀ¢ ¥ÁægÀA¨Às DUÀ®Ä PÀgÁgÀÄ EvÀÄÛ JAzÀgÉ ¤d. PÁèeï £ÀA.17.3 ¥ÀæPÁgÀ ¸ÀzÀj PÀgÁgÀÄ ¥ÀvÀæ ¥ÀæPÁgÀ PÀlÖqÀªÀ£ÀÄß ¸ÀA¥ÀÇtð PÀnÖ ¸Áé¢üãÀ PÉÆlÄÖ °Ã¸ï rÃqï £ÉÆAzÀtô ªÀiÁqÀĪÀªÀgÉUÀÆ ¤¦.3 G¨ÀsAiÀiÁ¥ÀgÀ ªÀÄzÀsåzÀ°è eÁjAiÀÄ°è EgÀvÀPÀÌzÀÄÝ JAzÀÄ PÁtô¹zÉ JAzÀgÉ ¤d. PÁèeï £ÀA. 18gÀ ¥ÀæPÁgÀ CzÀgÀ°è PÁtô¹zÀ G½zÀ PÁèeïUÀ¼ÀÄ °Ã¸ï rÃzï £ÉÆAzÀtôAiÀiÁzÀ £ÀAvÀgÀ CxÀªÀ ¤¦.3 gÀzÀÁÝzÀgÀÄ ¸ÀºÀ CªÀÅ ¸ÀvÀvÀ eÁjAiÀÄ°ègÀÄvÀÛzÉ JAzÀÄ PÁtô¹zÉ JAzÀgÉ ¤d. DzÉ® PÁèeï £À°è ¥ÀæwªÁ¢ purchase option £ÀÄß eÁjUÉƽ¸ÀÀĪÀªÀgÉUÀÆ ªÀÄvÀÄÛ PÀæAiÀÄ¥ÀvÀæ £ÉÆAzÀtô ªÀiÁr¹PÉƼÀÄîªÀªÀgÉUÀÆ AiÀiÁªÀÅzÀÄ ªÉÆzÀ¯ÉÆ C°èAiÀĪÀgÉUÉ ¤¦.3 eÁjAiÀÄ°ègÀÄvÀÛzÉ JAzÀgÉ ¤d. PÁèeï £ÀA.15 gÀ°è ¥ÀæwªÁ¢ °Ã¸ï rÃqï£ÀÄß £ÉÆAzÁ¬Ä¹zÀ £ÀAvÀgÀªÉà purchase option exercise ªÀiÁqÀ¨ÉÃPÉAzÀÄ PÁtô¹®è..."
At page 34 of his deposition, it is true that the P.W.1 has specifically deposed that 54 O.S.No.16735/2005 "In Clause 15.4 there is no specific word pre condition is used for payment of holding costs before exercising purchase option. He also has deposed that there is no specific clause in Ex.P-3 that non payment of holding costs would frustrate the contract and it would constitute breach of contract."
19. From the aforesaid evidence and contents of Ex.P-3 or Clause 12 of suit agreement, it is clear that the plaintiff, M/s Rani Rasamani Constructions Pvt Ltd and the defendant are agreed to execute and register lease deed at the cost of the defendant in favour of the defendant upon completion of Phase-I development in the form attached as Annexure VI. As per Clause 15 of suit agreement, it is clear that the defendant has sole and exclusive option to purchase the suit A schedule property with the buildings and improvements free and clear of all liens charges and encumbrances at the price agreed and that the said option to purchase shall remain valid and exercisable on and from the 2nd anniversary of lease upto and inclusive of the 6th anniversary day thereof. It is clear that as per Clause-15 first part, exercising of purchase option is without prejudice to the lease arrangement as stated in Clause 2.1 and 2.2 of the suit agreement. As per Clause 15.4, in consideration of the purchase option, the 55 O.S.No.16735/2005 defendant shall pay each month to the plaintiff and M/s Rani Rasamani Constructions Pvt Ltd a holding cost of Rs.2,16,000-00 per month until the defendant exercises the purchase option or untill the expiry of six years whichever is earlier unless before expiry of six years. If the defendant shall have decided not to exercise the purchase option, in which the obligation to pay the holding cost shall cease from such date as the defendant shall communicate it in writing to the plaintiff and M/s Rani Rasamani Constructions Pvt Ltd its decision not to exercise the purchase option. Clauses 5.4, 15, 15.1 to 15.7 shall survive the execution of the lease deed by the plaintiff and M/s Rani Rasamani Constructions Pvt Ltd in favour of the defendant until the expiry of original term of the lease and the first one year of the renewed term on the defendant exercises its purchase option and consequent execution and registration of the deed of sale in favour of the defendant whichever is earlier. Admittedly the plaintiff and the M/s Rani Rasamani Constructions Pvt Ltd have not signed on the lease deed duly signed on behalf of them that is sent to them for their signatures. But, the evidence of the DW- 1 that recorded during the course of his cross-examination at page-10 discloses that the plaintiff has not requested the defendants to sign on the lease deed prior to 15-11-2003 since 56 O.S.No.16735/2005 they have not obtained the occupancy certificate. Page 18 of cross-examination of the DW-1discloses that in the month of September 2004, the defendant has sought for modification of some the terms of the draft lease deed. Therefore, it is clear that the suit agreement shall remain in force from the date of its execution i.e. From 21.5.2003 till the commencement of the lease and execution and registration of the sale deed or if the defendant issues a written notification of termination or until return to defendant of the funds pursuant to Clause 5.
20. Admittedly no lease deed is executed till this date. The exercise of defendant's option to purchase the suit A schedule property is subject to taking the suit B schedule properties on lease for the periods as mentioned in the suit agreement subject to strict compliance of Clause 15.4 of the suit agreement and payment of admitted rent amount to the plaintiff and RRCL every month. As stated supra, it is admitted by the P.W.1 during his cross-examination that payment of holding cost is not a condition precedent to exercise defendant's option to purchase suit A schedule property. But, Clause 15.4 mandates that the defendant shall pay holding cost of Rs.2,16, 000/- per month until the defendant exercises its option to purchase the suit A schedule property or until expiry of six years which ever is 57 O.S.No.16735/2005 earlier or unless before the expiry of six years till the day when the defendant shall communicate in writing its decision not to exercise its purchase option. This fact is not disputed by the defendant. Admittedly, the defendant has paid only Rs.30, 00,000/- to the plaintiff and RRCL on 19.5.2003 towards part payment of security deposit. The said amount is not paid towards part sale consideration amount or towards holding cost. It is not a disputed fact that the plaintiff has filed this suit during the year 2005 for eviction of the defendant from the suit C schedule property alleging that the he has not been paid/paying admitted rent amount every month to the plaintiff. Admittedly, the defendant has not paid rent dues amount and balance security deposit amount to the plaintiff from 15.11.2003 till 2.11.2006, 2.1.2007, 15.1.2007 and 19.10.2006. The cheques sent to the plaintiff on the aforesaid dates have been returned to the defendant. The defendant has not deposited the sale consideration amount of Rs.23, 25,29,598/- in spite of its obtaining permission of this Court to deposit the same before this Court. Admittedly, the plaintiff has not paid the holding cost amount of Rs.2, 16, 000/- every month from 15.11.2003 till 2.11.2006, 2.1.2007, 15.1.2007 and 19.10.2006 before exercise of its purchase option. It may be true that the plaintiff has 58 O.S.No.16735/2005 invested more than 25 crores of rupees to have suitable infrastructure for its convenience to run a software company. Admittedly, the plaintiff agreed to take bare-shell building only on lease. Therefore, expenditure of 25 crores of rupees and construction canteen cannot be accepted that the plaintiff has done something in part performance of the suit agreement.
21. Possession of the suit schedule property was not delivered to the plaintiff towards part performance of its exercise of purchase option. It is admitted that it should be given first on registered lease basis. Evidence of DW-1 recorded during his cross-examination discloses that the plaintiff and RRCL have not forced to defendant to obtain possession of the suit B schedule property on 15-11-2003. Oral evidence of P.W.1 that payment of holding cost before exercising defendant's purchase option is not a condition precedent can be excluded in view of Sec.92 of the Indian Evidence Act, 1872 since admittedly Clause 15.4 of suit agreement provides that the plaintiff shall pay holding cost of Rs.2, 16,000/- per month to the defendants in addition to payment of agreed rent per month till he exercises his purchase option. Payment of the same every month to the defendants is mandatory because the word 'shall' is existed therein. In addition 59 O.S.No.16735/2005 to that, the defendant shall also has to obtain the suit B schedule property on lease for a period of 5 years from 15-11-2003.
22. In view of the fact that the plaintiff has failed to pay holding cost and admitted rent every month to the defendants from 15.11.2003 till 10.1.2005 the date of termination or till 15- 01-2007 the date of plaintiffs decision to exercise its purchase option as well as defendant's failure to take the suit B schedule property on lease for a period of 5 years from 30-10-2003 or 15- 11-2003, I am of the view that it is clear that the defendant is not ready and willing to perform his part of contract from 15.11.2003 till 15.1.2007. It appears that the defendant has decided to exercise its purchase option after lapse of nearly two years from the date when the plaintiff has instituted the suit for eviction during the year 2005. It is clear that the defendant may not exercise its option to purchase the suit A schedule property or he may not wanted to pay admitted rent and holding cost every month to the plaintiff and RRCL if the plaintiff was not instituted a suit for eviction during the year 2005. It may be that there was some delay in obtaining occupancy certificate etc. by the plaintiff and RRCL. But, the same shall not defeat the defendant's obligation to pay holding cost and admitted rent every month from 15-11-2003 since he occupied the suit B 60 O.S.No.16735/2005 schedule property even without obtaining the registered lease deed or without any demand from the plaintiff and RRCL to obtain possession of the suit B schedule property on 15-11-2003. Why the defendant has taken possession of the suit B schedule property on 15-11-2003 from the plaintiff and RRCL without obtaining the registered lease deed from them is not properly explained either in the written statement or in the evidence of DW-1. If the plaintiff and RRCL failed to execute and register lease deed, why the plaintiff has not taken any action as per law against them to have the lease deed executed and registered in its favour or to terminate the suit agreement marked as per Ex P-3 as per law before taking possession of the suit B schedule property is also not properly explained either in the pleadings or in the evidence of DW.1. Therefore, it appears that the defendant was happy to continue in the said property as tenant from month to month.
23. As per the decisions of the Hon'ble Apex Court in the reported cases in K.Simratulla's case, Pichimuthu's case, Bismillah Begum's case and as per recitals of page 49 of Pollock & Mulla on the Indian Contract & Specific Relief Acts, 14th edition 2012, the exercise of purchase option is subject to fulfillment of certain conditions by the purchaser, the agreement would be in effect be 61 O.S.No.16735/2005 an option to purchase, as the right to purchase would only accrue upon voluntary performance of the conditions specified by the owner. The conditions entitling the option holder to exercise the option must be strictly fulfilled. Therefore, it cannot be accepted that the defendant is/was always or ever ready and willing to perform his part of the obligations under the suit agreement. Though it is not specifically mentioned that the suit agreement would be frustrated, if holding cost is not paid, but in view of plaintiff's failure to fulfill the conditions specified therein i.e. payment of holding cost, rent, balance security deposits, etc. the suit agreement becomes frustrated or lapsed.
24. Afore stated evidence of the DW-1 placed before the Court it self discloses that the defendant was not serious in getting the registered lease deed. Admittedly till filing of this suit, the defendant has not taken any legal steps against the plaintiff and RRCL to obtain the registered lease deed in its favour. It may be that the terms of Ex P-3 shall survive until execution of the registered lease or sale deed. But, as stated supra as per section 107 of the T.P.Act 1882, for creation of a lease of immovable property for a period exceeding one year, execution and registration of an instrument is must. As per the said section, it is further clear that all other lease of 62 O.S.No.16735/2005 immovable property may be made either by a registered instrument or by oral agreement accompanied by delivery of possession. Therefore, it is clear that tenancy of the defendant in the suit schedule property is a month to month tenancy that terminable on issuance of notice by the plaintiff in view of section 106 of T.P.Act. It is not in dispute that the plaintiff has issued notice on 10-01-2005 terminating the said tenancy of the defendant with month ending on 31-01-2005 that is a valid termination in view of section 106 of T.P.Act. The plaintiff is entitle to 73% in the suit A & B schedule properties. The said 73% share is clearly demarcated and that it was shown in the blue colour in the sketches annexed to the suit agreement Ex P-3. The said blue coloured portion is the suit C schedule property. Portion marked in yellow colour is the 27% of RRCL's share. Therefore, contention of the defendant that tenacny shall not be split up cannot be accepted. The defendant as a lessee from month to month under the plaintiff is estopped from denying the plaintiff's title over the suit C schedule property. The defendant has not proved that the plaintiff has an intention to continue his month to month tenancy. The plaintiff has seriously contesting the suit. Therefore, mere acceptance rent dues during pendency of this suit is not amounts to a waiver of notice dated 63 O.S.No.16735/2005 10-01-2005. The defendant has contended that as per terms of the suit agreement, the plaintiff has no option to terminate the said tenancy at any cost. But, the T.P. Act has not provides to impose such restriction on the lessor in respect of lease of immovable property other than agricultural purpose. Therefore, the said contention of the defendant cannot be sustained. Therefore, the plaintiff is entitled to recover possession of the suit C schedule property from the defendant. Therefore, no grounds to accept the evidence of DW-1and the arguments urged in this regard that the tenancy is contractual for a period of five years and that the said tenancy has not been validly terminated. No grounds to reject the evidence of PW-1 and the arguments urged in this regard on behalf of the plaintiff. Hence, I answered the Issue No.1 as in the negative. I answered the Issue No.4 as in the affirmative.
25. Issues No 2 and 3 :- These issues are inter-linked to each other. Therefore, they are taken up together for joint consideration to avoid repetition of facts. It is the case of the plaintiff that he is entitled to claim damages in all valued Rs 4,51,96,169/- from the defendant.. The plaintiff in the plaint has claimed Rs.2, 05,38,322/- as rent/damages for occupation of suit C schedule property from 15.11.2003 till 30.1.2005. He also has 64 O.S.No.16735/2005 claimed balance security deposit amount of Rs.70,11,004/- and interest on damages from 1.2.2005 at Rs.7,02,405/-. The plaintiff has claimed damages for use and occupation of suit C schedule property from 1.2.2005 till the date of filing of this suit at the rate of Rs.30/- per sq.ft per month for building and Rs.10/- per sq.ft for the service area in respect of suit C schedule property. I have carefully gone through the suit C schedule property. Suit C schedule property does not contain the service area. The suit C schedule property consists of 82,055 sq.ft in the constructed building on the ground, first and second floor of the blocks known as A, B & C. As stated supra, the defendant has failed to prove that he is ready and willing to perform his part of contract. Therefore, it is clear that the defendant's right to exercise purchase option has been lost. The defendant also has failed to obtain the suit B schedule property that includes the suit C schedule property on 5 years lease as proposed in the suit agreement marked at Ex.P-3. Therefore, it is clear that the defendant is a tenant of month to month under the plaintiff in respect of the suit C schedule property. As stated supra, the said tenancy of the defendant has been terminated by way of giving 15 days notice on 10.1.2005. The said notice has been duly served on the defendant. Therefore, it is clear that month to 65 O.S.No.16735/2005 month tenancy of the defendant in respect of suit C schedule property comes to an end on 31.1.2005.
26. It is not in dispute that as per Clause 2.2 of the suit agreement, the plaintiff and the defendant are agreed that the rent per sq.feet for building is Rs.18/- per month and that rent per sq.feet for service area is Rs.6/- per month. Admittedly the defendant has not paid the said rent till filing of this suit. He has only paid Rs.30, 00, 000/- as interest free security deposit amount. Therefore, I am of the view that the defendant is liable to pay the admitted rent to the plaintiff per month in respect of use and occupation of the suit C schedule property from 15.11.2003. The defendant has contended that the plaintiff has not obtained occupancy certificate and that he had not executed the lease deed in his favour. Therefore, he has contended that he is entitled to pay only 50% of the admitted rent to the plaintiff in view of non fulfillment of Clauses 3 a and b of the suit agreement. As stated supra, the defendant obtained possession of the suit schedule property voluntarily without the force or compulsion from the plaintiff. It is also clear that the defendant has agreed to take bare shell building only on lease. The defendant was at liberty to terminate the suit agreement if the plaintiff has not complied Clauses 3A and B of the suit 66 O.S.No.16735/2005 agreement. In spite of that, the defendant has not done so, but he obtained possession of the suit schedule property voluntarily on 15.11.2003. Therefore, I am of the view that the defendant is not entitled to claim that he is liable to pay only 50% of the rent out of admitted rent of Rs.18/- per sq.ft for the building area. Therefore, I am of the opinion, that the plaintiff is entitled to claim Rs.18/- per sq.ft for the building from 15.11.2003 till 31.1.2005.
27. The rent per month in respect of the suit schedule property at the admitted rate at Rs.18/- per sq.ft amounts to Rs.14,76,990/-. At the rate of Rs.14,76,990/- per month in respect of suit schedule property, total rent amount for 14 months 15 days i.e., for the period from 15.11.2003 to 31.1.2005 amounts to Rs.2,07,51,709-50ps. But, the plaintiff has claimed only Rs.2,05,38,322/- for the said period. I have carefully gone through the suit agreement marked at Ex.P-3. Nowhere in the said document it is provided that the defendant shall pay interest at the rate of 24% p.a. to the plaintiff in respect of the arrears of rent. No agreement entered into between the parties to the suit that the defendant is liable to pay interest on the interest free security deposit amount. Therefore, I am of the view that the plaintiff is not entitled to claim interest at the rate of 24% p.a. on 67 O.S.No.16735/2005 the admitted arrears of rent. It is pertinent to note that the plaintiff has invested nearly Rs.100 crores of rupees to construct the suit B schedule property that includes suit C schedule property. Admittedly the defendant has not paid rent amount regularly to the plaintiff. Therefore, the plaintiff has sustained some loss. Hence, in the interest of equity and justice, I am of the view that the plaintiff is entitled to claim interest on the rent due amount at the rate of 6% from 15.12.2003. After termination of the said tenancy of month to month, the defendant has been in continuous possession and enjoyment of the suit schedule property. He has been getting crores of income from his Software business. Therefore, I am of the view that the defendant is liable to pay damages at the rate of Rs.18/- per sq.ft per month in respect of use and occupation of the suit C schedule property from 1.2.2005 till he is evicted from the suit schedule property in accordance with law. Therefore, I am of the view that no grounds to accept the arguments or the evidence of D.W.1 urged in this regard on behalf of the defendant. No grounds to discard or disbelieve the evidence of P.W.1 or arguments of the learned counsel for the plaintiff in this regard. Therefore, I answered Issue No.2 as in the affirmative and I answered Issue No.3 as partly in the affirmative. 68 O.S.No.16735/2005
28. Issue No.5 :- As stated above, the plaintiff is entitled to evict the defendant from the suit C schedule property. The plaintiff is also entitled to the admitted rent from 15.11.2003 till 31.1.2005. The plaintiff is also entitled to claim damages from the defendant at the admitted rent of Rs.18/- per sq.ft. from 1.2.2005 till the defendant is evicted from the suit schedule property. Order sheet reveals that the defendant has paid Rs.1,41,80, 562/- to the plaintiff on 31.1.2008. Order sheet further reveals that the defendant has paid Rs.43,77,026/- on 31.3.2008 to the plaintiff towards rent or towards payment of damages. Therefore, I am of the view that the defendant is entitled to deduct the amount that was already paid to the plaintiff out of the total arrears of rent/damages. Towards payment rent/damages dues, the defendant is also at liberty to deduct Rs Thirty lakh that paid to the plaintiff towards part of interest free security deposit amount on 19-05-2003. Therefore, I answered Issue No.5 as partly in the affirmative.
29. Issue No.6 :- In view of my findings on Issues 1 to 5 as above, this Court proceeds to pass the following :-
ORDER The suit of the plaintiff is hereby partly decreed with costs. 69 O.S.No.16735/2005 The defendant shall quit and deliver vacant possession of suit C schedule property (Portion marked in blue colour of the sketches annexed to the Ex P-3 agreement) to the plaintiff within 3 months from this date.
It is hereby further ordered that the defendant shall pay Rs.2, 05,38,322/- to the plaintiff with interest at the rate of 6% p.a. being the arrears of rent from 15.11.2003 to 30.1.2005.
It is hereby further ordered that the defendant shall pay Rs.18/- per sq.ft per month as damages in respect of use and occupation of the suit C schedule property from 1.2.2005 till he is evicted from the suit C schedule property with interest at 6% p.a. It is herby further ordered that the plaintiff shall pay Court- fee on the total amount of damages from the date of suit till eviction of the defendant from the suit C schedule property before executing the decree in view of section 42(3) of the Karnataka Court-fees and suits valuation Act 1958 It is hereby further ordered that the defendant shall deduct the amount that already paid towards the arrears of rent and Rs.30, 00,000/- that paid towards part of interest free security deposit on 19-03-2003.
It is hereby further ordered that if the defendant fails to quit and deliver vacant possession of the suit C schedule property 70 O.S.No.16735/2005 to the plaintiff within three months from this date, the plaintiff is at liberty to take possession of the same through the process of this Court at the cost of the defendant.
Draw up decree accordingly.
(Dictated to the Judgment-Writer directly through computer, computerized transcript thereof corrected, signed and then pronounced by me in the open Court on this the Wednesday the 13th day of April, 2016) [ B.VENKATESHA ], XXVIII Addl. City Civil & Sessions Judge, Mayohall, Bangalore.
SCHEDULE Schedule A :- All that piece and parcel of land comprising of Sy.Nos.18/1, 18/2, 18/5A, 18/5B, portion of Sy.No.20/2B and Sy.No.20/3, Kadabeesanahalli village, Varthur hobli, Bengaluru East taluk together admeasuring 6 acres 20 guntas and bounded as follows: East by Marthahalli-Sarjapur Ring road, West by Partly by Nala and partly by Sy.No.20/2B, North by partly by Road and partly by Sy.No.20/2A and 20/2B and South by Survey No.17 of Kadabeesanahalli village and Nala.
Schedule B :- All that piece and parcel of land measuring 2 acres and buildings constructed thereon known as Phase I -
Development being a portion of Schedule A property and comprising of three blocks of buildings viz., Block A, Block B and Block C, having basement, ground, first and second floors together admeasuring 1,12,405 sq.ft. in the project known as "RMZ Ecozen" constructed on the schedule A property above referred to.
Schedule C :- 73% of the schedule B property measuring 82,055 sq.ft. of saleable built up area comprising of 1. 38,310 sq.ft. on the ground floor across Blocks A, B & C. 2. 23,375 sq.ft. 71 O.S.No.16735/2005 on the first floor across Blocks A & C. 3. 20,370 sq.ft. on the second floor of Block A and marked in the colour blue in the plans annexed as Annexure to the plaint.
ANNEXURE
1. List of witnesses examined for the plaintiffs :-
P.W.1 : Raj Menda.
2. List of documents marked :-
Ex.P 1 : Extract of minutes of meeting.
Ex.P 2 Development agreement.
Ex.P 3 Agreement dt.21.5.2003.
Ex.P 4 Sale deed dt.13.5.2004.
Ex.P 5 Letter dt.22.5.2003.
Ex.P 6 Letter dt.20.11.2004.
Ex.P 7 Letter dt.24.11.2004.
Ex.P 8 TDS certificate for the year 2003-04.
Ex.P 9,10 TDS certificate towards rent.
Ex.P 11 Copy of legal notice.
Ex.P 12 Letter of postal department.
Ex.P 13 Letter dt.19.8.2011 of India Bulls Co. to
the plaintiff.
Ex.P 14 Notes of financial statement of defendant
company.
Ex.P 15 CC of letter dt.31.3.2006.
Ex.P 16 Copy of e-mail letter dt.10.8.2004.
Ex.P 17 Letter of Manoj.
Ex.P 18 Letter dt.31.10.2006 to RRCL.
Ex.p 19 Letter addressed to plaintiff dt.28.12.2004.
Ex.P 20 Letter dt.2.11.2006 to plaintiff by the
defendant.
Ex.P 21 to Official Memorandums.
24
Ex.P 25 Notification dt.9.3.2004.
Ex.P 26 to Copy of gazette notifications.
28
Ex.P 29 Endorsement dt.19.1.2013.
3. List of witnesses examined for the defendants :- 72 O.S.No.16735/2005
D.W.1 : Manoj Kumar Vaish.
4. List of documents marked :-
Ex.D 1 : Letter of intent.
Ex.D 2 Minutes of meeting.
Ex.D 3 to E-mail messages.
13
Ex.D 14 Quotation for supply and erection of
service lifts.
Ex.D 15 Quotation for supply and erection of MEI
make.
Ex.D 16 E-mail message.
Ex.D 17 Quotation for supply and erection of Oil
filled transformer.
Ex.D 18 Quotation for supply and
erection of bus duct outdoor.
Ex.D 19,20 Invoices for work called out by
plaintiff.
Ex.D 21 Campus facility infrastructure
details.
Ex.D 22 Work order.
Ex.D 23 WP order copy.
[ B.VENKATESHA ],
XXVIII ACC & S.J.
73 O.S.No.16735/2005
Case called. Pltff. Pre/abs. Deft. Pre/abs. Their counsels. Pre/abs Judgment pronounced in open court as under :-
The suit of the plaintiff is hereby partly decreed with costs. The defendant shall quit and deliver vacant possession of suit C schedule property (Portion marked in blue colour of the sketches annexed to the Ex P-3 agreement) to the plaintiff within 3 months from this date.
It is hereby further ordered that the defendant shall pay Rs.2, 05,38,322/- to the plaintiff with interest at the rate of 6% p.a. being the arrears of rent from 15.11.2003 to 30.1.2005.
It is hereby further ordered that the defendant shall pay Rs.18/- per sq.ft per month as damages in respect of use and occupation of the suit C schedule property from 1.2.2005 till he is evicted from the suit C schedule property with interest at 6% p.a. 74 O.S.No.16735/2005 It is herby further ordered that the plaintiff shall pay Court- fee on the total amount of damages from the date of suit till eviction of the defendant from the suit C schedule property before executing the decree in view of section 42(3) of the Karnataka Court-fees and suits valuation Act 1958 It is hereby further ordered that the defendant shall deduct the amount that already paid towards the arrears of rent and Rs.30, 00,000/- that paid towards part of interest free security deposit on 19-03-2003.
It is hereby further ordered that if the defendant fails to quit and deliver vacant possession of the suit C schedule property to the plaintiff within three months from this date, the plaintiff is at liberty to take possession of the same through the process of this Court at the cost of the defendant.
Draw up decree accordingly.
(Separate judgment is kept in file) (B.Venkatesha), XXVIII ACC & SJ.75 O.S.No.16735/2005