Anju Sharma vs Dr. Deepak Oberoi

Neena Bansal Krishna, J.

Regular First Appeal under Order XLI read with Section 96 of the Code of Civil Procedure, 1908 (hereinafter referred to as “CPC”) has been filed on behalf of the Appellant against the Judgment and Decree dated 13.05.2024 whereby the Suit of the Plaintiff for recovery of possession, arrears of rent, damages and mesne profits, was dismissed.

The Plaintiff Anju Sharma filed a Suit bearing No. 7671/16 for recovery of possession, arrears of rent, damages and mesne profits.

The brief facts as narrated in the Plaint are that Sh. Ram Nath Nijhawan, son of Sh. Jessa Ram was the owner of the property bearing No. 4/19, West Patel Nagar, New Delhi, by virtue of a registered Perpetual Lease Deed dated 29.04.1960. Sh. Ram Nath Nijhawan expired on 13.03.1965 and his wife Smt. Basanti Devi succeeded to the property. However, she also died on 09.02.1992.

Sh. Ram Nath Nijhawan and Smt. Basanti Nijhawan were survived by two sons, Sh. Yogesh Kumar Nijhawan and Sh. Ashok Kumar Nijhawan and two daughters, Smt. Suraksha Malik and Smt. Sanjokta Vij. Sh. Ashok Kumar Nijhawan had been missing and not traceable since 1972. Therefore, he was presumed to be dead. The second son Yogesh Kumar Nijhawan, who was unmarried, died on 17.12.1998. The daughter Smt. Sanjokta Vij executed a Relinquishment Deed dated 26.03.2002 in favour of her sister, Smt. Suraksha Malik. Therefore, Suraksha Malik became the exclusive owner of the suit property.

Smt. Suraksha Malik sold the property to the Plaintiff Anju Sharma vide registered Agreement to Sell, GPA, Receipt, etc., dated 21.03.2005, for a sale consideration of Rs.10,50,000/-.

It was explained that Sh. Yogesh Kumar Nijhawan as the landlord, had inducted Defendant, Sh. Deepak Oberoi as a tenant, in respect of first floor of the suit property (hereinafter referred to as the “Suit Property”) vide Lease Deed dated 01.11.1994 and 01.10.1995 and the last rent paid to Yogesh Kumar Nijhawan was Rs.3,000/- per month.

The Plaintiff stated that she served a Notice dated 27.07.2009 upon the Defendant explaining how she has acquired the ownership of the property and demanded arrears of rent for the last three years, to be paid within two months of receipt of Notice. She also enhanced the rent by 10% which was due after three years under Section 6A of the Delhi Rent Control Act (hereinafter referred to as the “DRC Act”). The tenancy of the Defendant was also determined. The Defendant gave a reply dated 10.08.2009. Therefore, the defendant became liable to pay rent @ Rs.3,300/-per month.

The Plaintiff again served a Notice dated 31.07.2012 enhancing the rent by 10%, i.e. to Rs.3,630/- after the expiry of month of service of Legal Notice. The Defendant gave a Reply dated 18.08.2012 to the Legal Notice, but he did not pay the arrears of rent.

The Plaintiff asserted that with the two Legal Notices, the rent has got enhanced to Rs.3,630/- w.e.f. 04.09.2012 and the protection of DRC Act ceased to exist. The Plaintiff thus, filed the Suit claiming possession, arrears of rent in the sum of Rs.1,22,430/- along with interest @ 15% p.a. and also served damages/mesne profits @ Rs.40,000/- per month w.e.f. 04.10.2012 till the handing over of the possession.

The Defendant Deepak Oberoi in his Written Statement took the preliminary objections that the Suit is based on false and concocted documents, through which the Plaintiff is claiming herself to be the owner. She in fact, is a stranger qua the Defendant and he does not recognize the Plaintiff as a lawful legal purchaser owner of the suit property. All the documents of sale, were claimed to be false and fabricated.

Further objection was taken that the Suit was grossly undervalued. The material fact had been concealed from the Court. The Suit was barred by the limitation under Section 111(a) of the Transfer of Property Act, 1882 (hereinafter referred to as the “TPA Act”). The lease of the Defendant was determined by efflux of time since Lease Deed dated 01.10.1996, which was for the duration of 11 months. Further, from September 1997 till December 1998, while Sh. Yogesh Kumar Nijhawan, owner of the property was still alive, but he made no attempt to get the property vacated from the Defendant upon his demise.

His sisters, Suraksha and Sanjokta claimed themselves to be the owner of the suit property, in equal share. However, neither of the two sisters took any steps for seeking possession. They slept over their proprietary rights, which led to the expiry of statutory period of 12 years, i.e., during which the sisters could legally have claimed their rights over the suit property, in terms of Section 27 Limitation Act. The Defendant claimed that the Plaintiff has thus, lost the right to claim suit property from the Defendant.

It is further submitted that Smt. Suraksha Malik had filed a Suit No. 125/1995 for partition against her brother late Yogesh Kumar Nijhawan and her sister Smt. Sanjokta Vij. However, on demise of Yogesh Kumar Nijhawan, the property devolved upon the two sisters, but neither of them took any step to seek possession of the suit property.

The Plaintiff Anju Sharma has based her claim to the property on the basis of an Agreement to Sell, GPA, Will, etc. However, the Plaintiff has failed to implead Smt. Suraksha Malik, who was necessary party for adjudicating the matter in dispute in the present Suit.

The Defendant further claimed that the sale documents relied upon by the Plaintiff, were forged and fabricated. The falsity of the claim can be demonstrated from the Letter of Attornment dated 21.03.2003 purportedly written by Smt. Suraksha Malik to the Defendants, wherein she had stated that she had sold the suit property to the Plaintiff, vide the documents dated 21.03.2005.

The Defendant had asserted that in the Letter of Notice of Attornment dated 21.03.2003, the date of Agreement to Sell is mentioned as 21.03.2003 when in fact, the documents bear the date of 21.03.2005; it all reflects the manipulation and the fabrication of the documents. Moreover, the Plaintiff herself has asserted that she had purchased the property on 21.03.2005, thereby indicating that the purported Attornment Letter dated 21.03.2003, i.e., two years prior to the date of the purchase of the property by the Plaintiff, is a false and fabricated document.

The extent of conspiracy between the Plaintiff and her sister Suraksha Malik, can also be understood from the fact that even the Relinquishment Deed executed between the sisters, has been signed by purported Power of Attorney holder of Smt. Sanjokta Vij, while no copy of the Power of Attorney has been filed along with the Relinquishment Deed. The Plaintiff and Suraksha Malik have attempted to take advantage of the fact that Sanjokta Vij is resident of outside India and has no information about the misdeeds of her sister and her illegal desires to take over the suit property.

The Relinquishment Deed is void ab initio and is of no legal consequence, since no Power of Attorney of P.K. Mullick has been filed to show that he had an authority to execute the Relinquishment Deed on behalf of Sanjokta Vij.

The Defendant has further asserted that the substitution letter dated 13.10.2004 issued by L&DO, is an unsigned typed copy, while the original has not been placed on record.

The Defendant further claimed that he has acquired the title in the suit property by way of adverse possession in terms of Article 65 Limitation Act. The tenancy got determined in September, 1997 and no steps were taken to recover the possession of the suit property, and the time of 12 years stand expired. Moreover, it is the Defendant who has been paying for the maintenance and upkeep of the suit property. The payment of taxes in respect of suit property by the Defendant, establishes his occupation in the suit property in his own right, which also corroborates the plea of adverse possession. The Suit is barred by limitation within the meaning of Section 27 read with Article 65 Limitation Act.

The Defendant has made a reference to Vasantiben Prahladji Nayak and Ors. v. Somnath Mulji Bhai Nayak and Ors. AIR 2004 SC 1893 wherein it was held that in case of the adverse possession, the static point of limitation does not commence from the day when the Plaintiff acquires the ownership, but from the day when the Defendant’s possession becomes adverse, which in the instant case is September, 1997.

Further, the Supreme Court in the case of Commissioner of Customs, Kandala v. Essar Oil Ltd. and Others, (2004) 11 SCC 364 held that fraud is well known to vitiate every solemn conduct. In fact, fraud is anathema to all equitable principles and any affair tainted with fraud cannot be perpetuated or saved by application of any equitable doctrine including res judicata. Similarly, in Hazma Haji v. State of Kerala & Anr. AIR 2006 SC 3028, the Supreme Court held that no Court would allow itself to be an instrument of fraud.

In O.P. Kurechia v. Manju & Ors. RFA No. 293/1997 decided on 02.09.1998, it was held that where the purchaser is unable to prove with cogent evidence that he is a bona fide purchaser, he cannot file any Suit on the basis of such documents.

It is further asserted that even though Plaintiff has claimed that all the documents were registered, but since Smt. Suraksha Malik herself did not have any proper title, she could not have conferred a better and a valid title on the Plaintiff.

The doctrine of privity of contract is the fundamental assumption of formal law. There is no privity of contract with the Plaintiff, who has no locus standi to file the Suit. Moreover, though the Plaintiff has made a reference to Delhi Rent Control Act, but the Suit is in the purview of the Delhi Rent Control Act. The present Suit is, therefore, liable to be dismissed.

On merits, it is admitted that the defendant came into the property by virtue of Lease Deed in 1989, entered into with late Yogesh Kumar Nijhawan, which was renewed from time to time for a period of 11 months. The Defendant stated that the last license fee was executed by Yogesh Kumar Nijhawan on 01.10.1996, which was only for a period of 11 months, i.e., till 31.08.1997, after the expiry of the said 11 months. The tenancy automatically came to an end by virtue of Clause 4 of Lease Deed. However, despite determination of the tenancy, the Defendant continued in possession of the suit property without renewal of Lease Deed and without paying any rent, in view of his possession. He managed to set up a title hostile to that against the owner of the suit property.

It is further stated that after expiry of Sh. Yogesh Kumar Nijhawan, his sister Suraksha Malik was contesting the Suit for partition against him at that time and during the course of the Suit, Smt. Suraksha Malik was well aware about the possession of the Defendant in the suit property.

Insofar as the ownership of Plaintiff is concerned, it was claimed that the Agreement to Sell, etc., dated 21.03.2003 were forged and fabricated. The service of the two Legal Notices sent in the year 2009 and 31.07.2012, was admitted.

It is claimed that had the Plaintiff been a genuine owner/buyer of the suit property, she would not have remained silent in seeking possession of the suit property and let her claims be barred under Limitation, as per Section 27 Limitation Act.

The Defendant has been enjoying continuous and unhindered possession over the property, since the termination of Lease Deed dated 01.10.1996. He has become owner of the suit property by way of adverse possession. Hence, it was submitted that the Suit of the Plaintiff is liable to be dismissed.

The Plaintiff in the Replication, reaffirmed her assertions made in the plaint and denied the objections and the grounds taken by the Defendant in the Written Statement. It was asserted that it was immaterial that whether the Defendant recognizes the Plaintiff as owner or not, but she is the owner of the suit property, in accordance with the law, having stepped into the shoes of erstwhile owner from whom the property has been purchased for valuable consideration.

It is further asserted that after the termination of tenancy by efflux of time in the year 1997, he became a statutory tenant on month-to-month basis, till his tenancy was terminated by the Plaintiff by serving Notice dated 27.07.2009. It was further submitted that the rent had been enhanced by 10% under Section 6A DRC Act, vide two Legal Notices and the protection of DRC Act is not available to the Defendant.

The learned District Judge vide Order dated 17.11.2015 framed the issues as under:-

The Plaintiff in support of her case examined PW1 Rakesh Sharma, Superintendent Land and Development Officer, who produced the original record dated 13.10.2004 whereby the name of Smt. Suraksha Malik was substituted/mutated. The copy of the document is Ex.PW1/1. He also produced the Lease Deed dated 29.04.2016 in respect of the property in question in the name of Ram Nath Nijhawan.

PW2- Anju Sharma, the Appellant deposed about the facts as narrated in the plaint. She proved the documents Ex.PW2/1.

DW1-Rabi Shankar, Data Processing Assistant, Census Commissioner, who proved the Notifications dated 07.09.2000, 26.09.2012 which are Ex.DW1/1 to DW1/3.

DW2-Kishor Kumar from the Office of Sub-Registrar, brought a death record register Ex.DW2/A pertaining to the year 1990 and deposed that the death record of Sh. Ashok Kumar Nijhawan vide Registration No. 4 dated 29.02.1990, is not mentioned in the Report.

DW3 Rakesh Sharma, Superintendent Land and Development Officer, produced the record pertaining to the Suit Property, which is Ex.DW3/1.

DW4-Deepak Oberoi, the Defendant deposed on similar lines as the defence taken in the Written Statement.

The learned District Judge, in the impugned judgement dated 13.05.2024 observed that admittedly the Defendant had entered into the suit property as a tenant and even after the termination of tenancy by efflux of time, he acquires the status of statutory tenant, under the Delhi Rent Control Act and in any case, he becomes a tenant at sufferance. Mere expiry of the term of license or lease, would not entitle the Defendant to claim adverse possession. The person who is in permissive possession, can never raise a plea of adverse possession against a person who had permitted him to enter the premises. It was thus, concluded that the plea of adverse possession as claimed by the Defendant, was not tenable against the Plaintiff.

It was, however, held that the Plaintiff had no right, title or ownership in the suit property on the basis of Agreement to Sell, etc., dated 21.03.2005. Furthermore, there was no Letter of Attornment giving her an authority to collect the rent from the Defendant. It was thus, held that the Plaintiff/Appellant were was not entitled to receive the rent or mesne profit from the Defendant. The Suit of the Plaintiff was, therefore, dismissed.

Aggrieved by the said judgment, the Appellant has preferred the present Appeal.

The grounds of challenge are that it has been erroneously held that the Appellant was unable to establish her ownership in accordance with law. It has not been appreciated that the Plaintiff had valid documents of sale, namely, registered Agreement to Sell, etc., executed in her favor by Smt. Suraksha Malik by virtue of which she acquired the ownership in the Suit Property.

Pertinently, no defence had been raised on the confirmation of title on the basis of the aforesaid set of title documents and no issue had been framed in this regard. Once no issue was framed, the Court could not have questioned the ownership of the Appellant on the basis of these title documents.

The Respondent had claimed in his Written Statement that the title document was fabricated, but failed to lead any evidence whatsoever in this regard. No fabrication of the documents could be proved.

The Suit for possession was for eviction of a tenant and there was no dispute of title amongst the owners and thus, the Plaintiff could not have been ousted on this ground. Merely because the name of the Appellant has not been substituted in the records of L&DO, is of no consequence as it is established law that mutation of a property in favor of the person, does not confer the ownership or the title. The Appellant indeed had applied for getting the property in question converted from lease hold to free hold, which could not be processed on account of various illegalities committed by the tenant on the other floors of the property in question.

The reliance on Suraj Lamp & Industries Pvt. Ltd. v. State of Haryana & Anr., AIR 2012 SC 206, is misplaced as in the said judgment itself, the Supreme Court made it clear that the ownership of the person based on Agreement to Sell, etc., cannot be doubted if they are executed prior to the date of decision.

The judgment of Shakeel Ahmad v. Sayed Akhlaq Hussain Civil Appeal No. 1598/2023 dated 01.11.2023 is based on its own fact and is not applicable to the case of the Appellant. Likewise, the judgment of Ganshyam v. Yoginder Rathi is in respect of unregistered documents, while the documents of the Plaintiff are registered.

It is further explained that there was a typographical error in mentioning the Attornment Letter as dated 21.03.2003, instead of 21.03.2005. Even if it is assumed that this Attornment Letter had not been sent, it does not make any difference once the Appellant became the owner of the suit property, which stood transferred to her by operation of law.

Section 109 TPA would apply and successor in interest would be entitled to the rights of the predecessor. It has not been appreciated that the Appellant had a better title than the Respondent and the relief could not have been denied to her.

The prayer was, therefore, made that the impugned judgment be set aside and the Suit of the Plaintiff for possession, arrears of rent and mesne profits be decreed.

The Appellant had filed the Written Submissions, which were essentially on the same lines, as the grounds of appeal.

The Respondent in the Written Submissions asserted that the alleged Agreement to Sell on which the reliance was placed by the Plaintiff was illegal and unenforceable since the Plaintiff had no right, title and interest in the Suit Property. The Relinquishment Deed was also illegal, unenforceable and deficient in the stamp duty.

It was claimed that the Attornment Letter mentioned the date as 21.03.2003, when in fact the same transaction had allegedly taken place vide documents dated 21.03.2005 thereby reflecting that the Attornment Letter has been fabricated.

The Respondent is in adverse possession of the suit property since October 1997 and as his possession has been peaceful, undisturbed and continuous till date, the suit of the Plaintiff for possession is barred under Section 54 TPA, as he has no registered Sale Deed in her name. The Agreement to Sell, etc., does not confer any right, title or ownership in the suit property.

Submissions heard and record perused.

The Plaintiff/Appellant had sought possession of the suit property from the Defendant/tenant, being the owner/landlord of the suit property, having purchased it from the erstwhile owner Smt. Suraksha Malik, by virtue of agreement to Sell, etc. dated 21.03.2005 for a sum of Rs. 10,50,000/-.

The Plaintiff has explained that originally, the suit property was owned by Sh. Ram Nath Nijhawan, in whose favour, the Lease had been executed by the L&DO in the year 1960. After his demise in 1965, the Property devolved upon his wife, Smt. Basanti Nijhawan, two sons, Sh. Yogesh Kumar and Sh. Ashok Kumar and two daughters, Ms. Sanjokta Vij and Ms. Suraksha Malik. The son, Sh. Ashok Kumar Nijhawan had gone missing since 1972 and was never found or his whereabouts traced. Consequently, in terms of Section 108 of the Evidence Act, he is presumed to be dead.

Sh. Yogesh Kumar Nijhawan, the son of Smt. Basanti Nijhawan, acting as a landlord, had rented out the suit premises to the Defendant in 1989 and admittedly, the Defendant continued to be a tenant in the Suit premises. The last Lease Deed was executed on 01.10.1996, which not only recorded the relationship between the parties, but also mentioned that the rate of rent was Rs.3,000/- per month.

As stated by the Defendant, Ms. Suraksha Malik had instituted a Suit for Partition and rendition of accounts vide Suit No. 125/1995 against her brother Sh. Yogesh Kumar Nijhawan and Ms. Sanjokta Vij. However, Sh. Yogesh Kumar Nijhawan died on 17.12.1998, while Smt. Basanti Nijhawan died on 09.02.1992. Thus, the two sisters became the owner of the property in question.

Smt. Sanjokta Vij (who was based in US), executed a registered Relinquishment Deed dated 26.03.2002, Ex. PW2/2, through her Power of Attorney holder, Sh. P.C. Malik in favour of Smt. Suraksha, her sister, who then became the absolute owner of the suit property.

The Defendant/tenant has questioned the registered Relinquishment Deed dated 26.03.2002, on the ground that the SPA of Sh. P.C. Malik, who on behalf of Ms. Sanjokta Vij, had executed the Relinquishment Deed, was not placed on record. However, the Relinquishment Deed is a registered document and also it was never ever challenged by Ms. Sanjokta Vij. There is no basis for challenge of the validity of this Relinquishment Deed by the Defendant. Moreover, the suit property was mutated in the name of Smt. Suraksha Malik, vide Letter dated 13.10.2004, Ex.PW1/1, issued by the Office Department of L&DO. Ms. Suraksha Malik is, therefore, proved to be the absolute owner of the suit property.

The Appellant has questioned the long quietude of Ms. Sanjokta Vij and Ms. Suraksha Malik, in not seeking eviction of the tenant despite being well aware of the fact that the Defendant was in possession of the suit property. As is evident from the aforesaid discussion, the erstwhile owners were interse trying to settle the title of the property, but that would not change the status of the tenant, to that of ownership nor would the delay in seeking the eviction confer any ownership rights on the tenant.

Furthermore, the Appellant, the subsequent buyers, had served two Legal Notices for enhancement of rent over a period of time, to overcome the bar of Delhi Rent Control Act.

Ms. Suraksha Malik, on acquiring absolute ownership, sold the suit property to Ms. Anju Sharma vide Registered Agreement to Sell, GPA, Will dated 21.03.2005, which are Ex.PW2/3 (colly.). The entire edifice of challenge to the present Suit and resistance to possession of the Defendant, is essentially based on the challenge to the ownership of the Plaintiff, by virtue of these documents.

The first objection taken is the Agreement to Sell, is merely an Agreement to Sell and does not create any right title, interest in the suit property, as has been held by the Hon’ble Supreme Court of India in the case of Suraj Lamps & Industries Pvt. Ltd. vs. State of Haryana & Anr. AIR 2012 SC 206.

First and foremost, what emerges, is that though these documents may not create an absolute title and may entitle the Plaintiff, to get the document. The Property mutated in her name or to get a Sale Deed executed from the concerned Department, as has been observed in the case of Suraj Lamp (supra), but it definitely creates a title superior to that of the defendant who entered in the suit property as a tenant.

It may be mentioned that in the Agreement to Sell, it was specifically mentioned that the Plaintiff shall have a right to collect the rent from the tenants, thereby reflecting that the Plaintiff stepped into the shoes of erstwhile owner and became the landlord with a right to collect the rent from the Defendant.

Moreover, the GPA dated 21.03.2005 also authorised the Plaintiff to let out the Property, whole or in part, to execute the Lease Deed get the same registered, to receive the rent, to issue receipts and to get the tenants evicted, through the process of law or by negotiation, to take the possession, etc.

These documents are sufficient not only to confer rights in the nature of ownership where the third party is concerned, but even otherwise, specifically authorised the Plaintiff, to collect the rent and to affect the tenants. It is quite evident that the Plaintiff stepped into the shoes of erstwhile owner and became the landlord vis-à-vis the suit property.

Much has been contended on behalf of the Defendant that these documents are fraudulent because the Letter of Attornment, Ex.PW2/4 is dated 21.03.2003 and in the said Letter of Attornment, it is mentioned that Smt. Suraksha Malik has sold the Property to the Plaintiff, Smt. Anju Sharma, by virtue of Agreement to Sell etc. dated 21.03.2003. It is asserted that the sale documents were admittedly executed on 21.03.2005, while the Letter of Attornment is dated 21.03.2003, which clearly reflects that the Letter of Attornment was a manipulated document, as it could not have been written in 2003 i.e. two years prior to the execution of the documents which are dated 21.03.2005.

It is significant to observe that the bare perusal of the Agreement to Sell, etc., reflects that the stamp paper was purchased on 13.05.2005 and the registration of the documents has been done on 21.03.2005.

What emerges from the perusal of the Agreement to Sell, etc., is that the date of execution of the documents, has been mentioned in hand and the date 2005, has been misread as 2003, which is possible from the manner in which, the year 2003 has been mentioned in the documents. The relevant paragraph of Agreement to Sell, reads thus:

Likewise, in the GPA as well, the date of execution of document, has been mentioned in hand, as stated above. While there may have been a misreading of the date on which the document got executed by the Plaintiff, but it cannot be overlooked that there were written executed and a registered document/agreement to Sell, etc. that would prevail over the Letter of Attornment, Ex.PW2/4 in which the date of purchase of property has been mentioned erroneously.

Another contention raised by the Defendant was that no Letter of Attornment, dated 21.03.2003, Ex.PW2/4 issued by the erstwhile owner, was ever received by him. Even if this contention is accepted that the contents of the Attornment Letter, are contrary to the documents of purchase of Property by the Plaintiff, but merely because the Attornment Letter is not a reliable document, would not make the entire sale transaction in favour of the Plaintiff, as void. It is evident that the Plaintiff acquired the ownership rights by virtue of Agreement to Sell etc. collectively, Ex.PW2/3.

The learned District Judge fell in error in questioning the ownership, in terms of Section 54 of TPA and by observing that no Sale Deed has been executed, but it is a settled law that in the absence of the absolute document of sale, the proprietary rights assumed significance and they prevail against the entire world except the true owners. In the present case, Ms. Suraksha Malik has not challenged the execution of the Agreement to Sell, etc. Therefore, the learned District Judge erroneously held that the Plaintiff was not able to prove her ownership to maintain the Suit for possession.

In this context, it is also significant to mention that the Plaintiff, Ms. Anju Sharma had filed a Suit for eviction under Section 14(1)(e) against Dr. B.S. Sirohi, who was the tenant in the Ground Floor and the Leave to Defend had been allowed vide Order dated 21.12.2013 by learned ARC wherein also, the title of the Plaintiff, was considered and it was found that she had become the owner/landlord in respect of the suit premises.

In the light of aforesaid discussion, it is concluded that the Plaintiff has successfully established that she stepped into the shoes of the erstwhile owner and became the landlord/owner of the suit property by virtue of the registered Agreement to Sell, General Power of Attorney, etc. dated 21.03.2005.

She stepped into the shoes of erstwhile owner and became the landlord in respect of the suit property.

The next aspect is the status of the Defendant, in the suit premises. He himself has admitted that he was inducted in the suit premises as a tenant, by Late Sh. Yogesh Kumar Nijhawan, who was his landlord and that he had been paying rent to him. He further admitted that the last Lease Agreement was executed on 01.10.1996, under which the rate of rent was specified as Rs.3,000/- per month, which he had been paying.

The Defendant in his two Replies to the Legal Notice dated 10.08.2009, Ex.PW2/7 and 18.08.2012, Ex.PW2/9, has admitted not only that there existed a landlord tenant relationship between him and Sh. Yogesh Kumar Nijhawan, but stated that he had no knowledge of the property having been sold to the Plaintiff. The status of the Defendant, is admittedly that of a tenant, who had been inducted by the erstwhile owner. He is estopped under Section 116 of the Indian Evidence Act, to challenge the title of the landlord.

It is, therefore, proved that there exists a relationship of landlord and tenant between the parties on the basis of the evidence led by both the parties.

The next plea, which has been taken by the Defendant, is that he has become the owner by adverse possession. His claim is that his tenancy expired on September, 1997 on expiry of the Lease Deed dated 01.10.1996. He is in adverse possession since then and has acquired ownership by a virtue of adverse possession.

The Defendant/Appellant has admitted that he had been inducted as a tenant by Yogesh Kumar Nijhawan, one of the co-owners/landlord of the suit property, as has already been held that the Defendant/Appellant is inducted as tenant and there existed the relationship of landlord and tenant between the parties.

It is a well settled law that once a person is inducted as a tenant, his status continues to be that of a tenant, as held in M. R. Sawhney v. Doris Randhawa, AIR 2008 Delhi 110. He cannot claim that he was in adverse possession of the Suit Property merely because he continued in the premises after the expiry of the tenancy.

The very concept underlying adverse possession is that the person in possession must claim to be so of right as against the true owner. It must be nec vi, nec claim, nec precario. It must be adequate in continuity and publicity to the extent of showing that it is averse to the competitor. It must be hostile and under a claim or colour of title. It must be actual, open, uninterrupted notorious, exclusive and continuous and it must run over the entire statutory period of 12 years. Any person who bases his claim to title by adverse possession should be hostile to the real owner with the attributes of notoriety, exclusivity and continuity over the statutory period.

In Konda Lakshmana Bapuji v. Govt. of A.P. and others, 2002 (3) SCC 258 the Apex Court declared that onus of proof to establish acquisition of title try prescription lies on the party who makes any such assertion. The court explained that mere possession of land, however, long it may be, would not ripen into title unless the possessor has animus possidendi to hold the land adverse to the title of the true owner and that an assertion of title by adverse to the title of clear and unequivocal through, not necessarily addressed to the real owner. It was held that “Where, however; at the commencement of the possession there is no animus possidendi, the period for the purpose of reckoning adverse possession will commence from the date when both, the actual possession and assertion of title by the possessor are shown to exist".

To the same effect is the decision of Supreme Court in Karnataka Board of Wakf v. Government of India and others, 2004 (970) SCC 779 wherein the Apex Court reiterated the same principles. It was held:

In this regard, reliance may also be placed upon the decision of the Apex Court in Ravinder Kaur Grewal & Ors. V. Manjit Kaur & Ors., (2019) 8 SCC 729, wherein the Court held that a claim of adverse possession can succeed when the claimant establishes the essential ingredients of nec vi, nec clam and nec precario, i.e., possession must be continuous, open and notorious, and hostile to the title of the true owner.

In the present case, there is nothing to show that the Defendant ever claimed ownership against the rightful owners or that his possession was open, adverse or hostile, to that of the owners of the property. The defendant has not been able to prove his title having been perfected to that of the owner, by way of adverse possession.

It may also be relevant to refer to the two Replies to the Legal Notice, dated 10.08.2009, Ex.PW2/7 and 18.08.2012, Ex.PW2/9, wherein the Defendant himself admitted that he had been inducted into the suit property as a tenant by Late Sh. Yogesh Kumar Nijhawan and merely asserted that he had no knowledge if the suit property has been sold to the Plaintiff. Significantly, there was no assertion of ownership in himself or any denial of the title of the true owner.

The Defendant has failed to substantiate his challenge to the Plaintiff’s title or his plea of adverse possession. The learned District Judge fell in error in application of law and the findings on the facts, are perverse, for the reasons stated hereinabove.

The Defendant/Respondent in the Written Statement stated that he was inducted in the premises by Sh. Yogesh Kumar Nijhawan and the last Lease Deed dated 01.10.1996 by Yogesh Kumar Nijhawan wherein the rate of rent was Rs.3,000/- per month. There was no suo moto escalation either provided in the Lease Deed, nor is it contemplated in the Delhi Rent Control Act. Likewise, in his Reply dated 10.08.2009 Ex.PW2/7 the Defendant had stated that he has been residing in the premises since 1989, and has always duly paid the rent to the landlord and has been in peaceful possession of the suit premises.

The Defendant, therefore, admitted his status in the suit property as that of a tenant since 1989 and he also admitted the execution of the Lease Deed dated 01.10.1996, and that the rate of rent was Rs.3,000/- per month.

The Plaintiff/landlord had sent Legal Notice dated 27.07.2009 Ex.PW2/C, whereby she had claimed 10% escalation of rent i.e. Rs.3,300/-per month, being the 10% enhancement as contemplated under Section 6A of the Delhi Rent Control Act. Thereafter, after three years, the Plaintiff/Landlord again sent another Legal Notice dated 31.07.2012 Ex.PW2/A, wherein the rent was further enhanced by 10% to Rs.3,630/-w.e.f. 04.09.2012. The service of the two Legal Notices is admitted, as the Defendant had given a Reply to both the Legal Notices respectively.

Therefore, by virtue of these two Legal Notices the Rent was enhanced to Rs.3,630/- w.e.f. 04.09.2012. The Defendant has admitted not paying the rent after the demise of Yogesh Kumar Nijhawan.

The Appellant had proved her ownership in the Suit property by virtue of Agreement to Sell etc. dated 21.03.2005, Ex.PW2/3. Therefore, having acquired the status of landlord, she became entitled to the arrears of rent. However, the Suit has been instituted on 06.11.2012 and she can claim arrears only which are legally permissible i.e. for three years prior to the institution of the Suit.

She is entitled to arrears of rent w.e.f. November, 2009 at the rate of Rs.3,300/- per month (as enhanced by the Legal Notice dated 27.07.2009 Ex.PW2/C) and thereafter, at the rate of Rs.3,630/- per month w.e.f. 04.09.2012 (as further enhanced by the Legal Notice dated 31.07.2012 Ex.PW2/A). The Appellant is, therefore, entitled to arrears of rent from November, 2009 till August 2012 when the Notice of Termination of tenancy was served, in the sum of Rs.1,12,200/- with interest @ 6% per annum.

As has been discussed above, after the termination of Tenancy vide Legal Notice dated 31.07.2012 Ex.PW2/A, the Defendant became an unauthorized occupant in the suit premises. The question which thus, arises is in regard to the Mesne Profits that are payable by the Defendant. Section 2(12) CPC defines Mesne Profits as under:

Mesne Profits are in the nature of compensation on account of breach of a liability of the Tenant to vacate the premises, once the tenancy is terminated. The fundamental principle for calculation of the Mesne Profits is in terms of Section 73 and 74 of the Contract Act. Section 73 of the Contract Act reads as under:

Thus, the measure of compensation under Section 73 is the loss or damage which naturally arose in the usual course of things from the breach, or which the parties knew, when they made the contract, to be the likely result of the breach thereof. In the context of a tenancy, the loss naturally arising from the tenant's failure to vacate after termination, is the rent which the landlord could have received had the premises been vacated and let out.

The complementary provision is Section 74, which reads as:

The Supreme Court in the case of Fateh Chand v. Balkishan Das, AIR 1963 SC 1405, while considering Sections 73 and 74 of the Contract Act, observed that the jurisdiction of the Court to award compensation in cases of breach of Contract is unqualified except as to the maximum stipulated in the Contract, but the compensation has to be reasonable and imposes a duty upon the Court to award compensation according to the settled principles. The expression "whether or not actual damage or loss is proved to have been caused thereby" merely dispenses with proof of actual loss or damages; it does not justify the award of compensation when in consequence of the breach, no legal injury at all has resulted, because compensation for the breach of Contract can be awarded to make good loss or damage which naturally arose in the usual course of things which the parties knew when they made the Contract to be likely to result from the breach.

It was further held that Section 74 does not confer a special benefit upon any party. It merely declares the law that notwithstanding any terms of the Contract pre-determining damages or providing for forfeiture of any property by way of penalty, the Court would award to the party aggrieved only reasonable compensation not exceeding the amount named or penalty stipulated. The Court has to adjudge in every case reasonable compensation to which the Plaintiff is entitled from the Defendant on breach of the Contract. Such compensation has to be ascertained having regard to the conditions existing at the time of breach. Similar observations were made by the Supreme Court in the case of Maula Bux v. Union of India, (1969) 2 SCC 554.

In the case of ONGC Ltd. v. Saw Pipes Ltd., (2003) 5 SCC 705, while referring to the principles laid down in the case of Fateh Chand (supra), it was observed that on the conjoint reading of Sections 73 and 74 of the Contract Act, it emerges that the emphasis is on reasonable compensation. If it is by way of a penalty, considerations would be different and the party would be entitled only to reasonable compensation for the loss suffered. But if the compensation named in the Contract for such breach is a genuine pre-estimate of loss which the parties knew when they made the Contract, to result from the breach, then there is no question of proving such loss or such party is not required to lead evidence to prove actual loss suffered by him.

This was again revisited in the case of Kailash Nath Associates v. Delhi Development Authority and Anr., (2015) 4 SCC 136, wherein it was observed that in case of breach of some Contract, in some cases it is impossible for the Court to assess compensation arising from the breach, while in other cases compensation can be calculated in accordance with the established rules. Where the Court is unable to assess the compensation, the sum named by the parties, if regarded as a genuine pre-estimate, may be taken into consideration as a measure of reasonable compensation, but not if the sum named is in the nature of a penalty. Where loss in terms of money can be determined, the party claiming compensation must prove the loss suffered by him.

In the case of Atma Ram Properties Pvt. Ltd. v. Federal Motors (Pvt.) Ltd., (2005) 1 SCC 705, while considering the user and occupation charges to be paid by the tenant after termination of the tenancy, it was observed that for the period for which the tenant continues to occupy the premises, he becomes liable to pay damages for the use and occupation charges at the rate at which the landlord could have let out the premises on being vacated by the tenant.

It was further observed that if the real value of the property is higher than the rent earned, then the amount of compensation for continued use and occupation of the property by the tenant, can be assessed at the higher value. It was additionally observed that the value of real estate and rent rates have sky rocketed. The factors like the location of the suit property being in a commercial locality and the duration of the tenancy are the relevant factors for assessing the user and occupation charges.

In M/s Sahara India v. M.C. Agrawal HUF, 2011 SCC OnLine Del 3715, this Court had occasion to consider the question of assessment of mesne profits payable by an erstwhile tenant who continued in occupation after termination of the tenancy. It was observed that the entitlement of a landlord to claim mesne profits is governed by Section 2(12) of the CPC, and that the mesne profits which a landlord is entitled to recover against a tenant who continues to stay in the tenanted premises after the termination of the tenancy, is the amount which the premises can fetch if let out on rent during the period of its illegal occupation by the tenant.

It was further held that "What is the rent which the premises can fetch during the period of the illegal occupation by the erstwhile tenant is a fact which can be easily proved in a suit for possession and mesne profits against the tenants by leading evidence with respect to rents of similar premises within the locality. The Court, on considering such evidence, with respect to rent of similar premises thereafter awards mesne profits to the landlord."

It was further observed that where the landlord has not led any evidence with respect to the rent of similar premises in the locality during the relevant period, the Court may nonetheless take judicial notice of the increase of rent in the urban areas, by applying the provisions of Sections 114 and 57 of the Indian Evidence Act, 1872, and award mesne profits at the last-paid contractual rent with an appropriate annual compounded enhancement. The Court accordingly, assessed mesne profits by applying an annual compounded enhancement of 15% over the contractual rent for each year of unauthorised occupation.

In the recent judgment in M/s Mehra Jewel Palace Ltd. v. Miniso Lifestyle Pvt. Ltd. and Anr., 2025 SCC OnLine Del 6132, all the aforesaid judgments were revisited and it was concluded that a person whose tenancy is terminated, would be liable to pay the user and occupation charges and in the least, the Lease rentals as per the Lease Deed are definitely payable.

In the present case, no evidence has been led by the landlord to prove the actual prevailing market rate. However, as has been discussed above, the minimum loss that is suffered by the landlord is the rate of rent which was payable at the time of termination of tenancy.

The Plaintiff had claimed mesne profits @ Rs.40,000/- per month without leading any corroborative evidence, in support thereof. The case therefore, squarely falls within the class of cases contemplated in Sahara India (supra), where, in the absence of such evidence, the Court may assess mesne profits by applying the last-paid contractual rent with an appropriate annual enhancement.

The last rent payable by the Defendant was Rs.3,630/- per month. As has already been pointed out, the tenancy was created in 1989. Since then 30 years have gone by and the tenant has been enjoying the property practically without paying anything. Considering the present prevailing real estate prices and the market rate of the premises and its location which is in West Patel Nagar, New Delhi, the Mesne Profits are awarded @ Rs.3,630/-per month (the last determined rent) w.e.f. 01.09.2012, with an annual enhancement of 15% per annum, along with interest @ 6% per annum, till the date the possession is handed over to the Plaintiff.

Accordingly, the Suit of the Plaintiff is decreed for Possession as well as arrears of rent in the sum of Rs.1,12,200/- along with pendente lite and future interest @ 6% per annum. The Plaintiff is further entitled to mesne profits/unauthorised user and occupation charges at the last-paid rent of Rs.3,630/- per month w.e.f. 01.09.2012, with an annual increase of 15% per annum, till the date the possession is handed over, along with interest @ 6% per annum.

The Suit of the Plaintiff for possession in respect of the suit property, arrears of rent and mesne profits, is hereby decreed.

Accordingly, the impugned Judgment and Decree dated 13.05.2024 is set aside and the present Regular First Appeal is allowed, in the aforesaid terms.

Pending Application(s), if any, also stand disposed of.