R.S.A.No. 3736 of 2001 1 In the High Court of Punjab and Haryana at Chandigarh R.S.A.No. 3736 of 2001 Date of decision: 7.8. 2009 M/s Garg Steel Industries and others ......Appellants Versus M/s Bhakoo Industries .......Respondent CORAM: HON'BLE MRS. JUSTICE SABINA Present: Mr.M.L.Sarin, Sr. Advocate with Mr. Gursimran Sidhu, Advocate, for the appellants. Mr.A.K.Chopra, Sr.Advocate with Mr.Sumeet Abrol, Advocate, for the respondent. **** SABINA, J. Plaintiff M/s Bhakoo Industries filed a suit for recovery, which was partly decreed by the Senior Sub Judge, Chandigarh vide judgment and decree dated 8.12.1995. Aggrieved by the same, both the parties went in appeal. The District Judge, Chandigarh, vide judgment and decree dated 11.4.2001, dismissed both the appeals and the findings of the learned lower Court were upheld. Hence, the R.S.A.No. 3736 of 2001 2 present appeal by the defendants. Brief facts of the case, as noticed by the trial Court in para Nos. 2 and 3 of its judgment, are as under:- “2. Case of the plaintiff is that he is owner/landlord of Shed No.433, Phase-II, Industrial Area, Chandigarh. He inducted the defendants as his tenants in the shed portion as shown in black colour in the map at the back of agreement Ex.PY on a monthly rent of Rs.3500/- excluding electricity charges. The remaining portion shown in red colour (actually not shown in any colour but shown blank) remained with the plaintiff. The defendants were specifically deprived of the use of the same. It had been further agreed between the parties that in case the defendants used the remaining blank portion, which remained in possession of the plaintiff, they would pay double the amount of the lease money each month as damages. In the blank portion in possession of the plaintiff, he (the plaintiff) placed machinery in order to use that portion. In October, 1988 when proprietor of the plaintiff visited the shed in question he came to know that the defendants were using the blank portion in possession of the plaintiff as well alongwith the machinery of the plaintiff placed therein. Thus, since October, 1988, the defendants have been using the said portion of the plaintiff and his machinery and they are, therefore, liable R.S.A.No. 3736 of 2001 3 to pay damages @ Rs.6,000/- per month. The plaintiff earlier filed a suit for the recovery of Rs.24,000/- for use and occupation of the said portion and machinery of the plaintiff by the defendants for the period 1.10.1988 to 31.1.1989. That suit was decreed by Sh.T.R.Bansal, Sub Judge Ist Class, Chandigarh, vide his judgment and decree dated 5.6.1991. The appeal filed by the defendants was pending when this suit was filed and has since been dismissed by the learned District Judge, Chandigarh on 31.8.1995. Therefore, the defendants are liable to pay damages for use and occupation of the portion in dispute and for the use of the machinery installed therein for the period 1.2.89 to 30.11.91 @ Rs.6,000/- per month to the tune of Rs.2,04,000/-. Hence this suit for the recovery of this amount. A decree for the recovery of damages for future use and occupation from 1.12.1991 onwards and pendente-lite interest @ 18% per annum has also been sought. 3. The defendants have filed written statement and contested the suit pleading that the plaintiff has not come with clean hands. He has never used or occupied any part or portion of the entire shed in question. The whole of the shed was rented out to the defendants. In the rent agreement the portion was shown less because according to the terms and conditions of the allotment R.S.A.No. 3736 of 2001 4 letter, vide which the shed in question had been allotted by CITCO to the plaintiff, the plaintiff was not permitted to rent out the full shed. The plaintiff has never run any business in the shed in question. He was doing his business in plot No. MW-41, Industrial Area, Phase-I, Chandigarh. It has also been pleaded that the suit in the present form is not maintainable because the plaintiff has not claimed possession. The claim for damages is only consequential relief and is not maintainable without suing for possession. If it is found that the defendant is trespasser in the portion of the shed in dispute regarding which damages, are being claimed, then suit for recovery of damages only against the trespasser is not maintainable. It has been pleaded that the whole of the shed was led out to the defendants w.e.f. 1.12.86 @ Rs.3,000/- per month including water and electricity charges. The alleged agreement is in admissible in evidence. The entire shed is in use and occupation of the defendants from the very date of inception of the tenancy w.e.f. 1.12.86. After that date the plaintiff never remained in possession of any part of the shed in question. The rent which was initially Rs.3,000/- per month was subsequently enhanced to Rs.3,500/- per month and at the time of enhancement also the entire shed in question used to be in use and occupation of the defendants. The R.S.A.No. 3736 of 2001 5 defendants have, therefore, denied their liability to pay any damages for use and occupation to the plaintiff pleading that they are tenants qua the entire shed in question including the disputed portion. It has also been pleaded that rent of the demised premises had already been paid by the defendants to the plaintiff. In the rent petition filed by the plaintiff along with interest and costs and therefore, the defendants are not liable to pay any amount of damages for use and occupation.” On the pleadings of the parties, following issues were framed by the trial Court:- “1. Whether the plaintiff is entitled for recovery of the amount as prayed for? OPP 2. Whether the suit as framed is not maintainable as alleged in preliminary objection No.3 of the amended written statement? OPD 3. Relief. ” Learned senior counsel for the appellants has vehemently argued that the suit of the plaintiff was liable to be dismissed. The plaintiff was owner of the shed in dispute. However, as per the conditions imposed by the Administration (CITCO), the plaintiff could not sub let more than 50% of the covered area of the industrial shed. In fact, the defendants had been sub let the entire shed in dispute. It was only due to the terms and conditions of the lease that agreement with regard to half of the portion of the premises in dispute was R.S.A.No. 3736 of 2001 6 reduced into writing. However, the lease deed (Ex.P-8) was inadmissible in evidence as it was not a registered document. Hence, any of the conditions mentioned in the lease deed could not be taken in consideration while determining the damages. In fact, the defendants were not liable to pay any damages as the entire shed in question had been leased out to them. The rate of rent was initially Rs.3,000/- per month and thereafter, it was increased to Rs.3,300/- per month and on 14.1.1989, the rate of rent was increased to Rs.3,500/- per month. No interest could be allowed to the plaintiff on the damages. Plaintiff had failed to establish his claim for recovery of reasonable damages, if any. In support of his arguments, learned senior counsel for the appellants has placed reliance on the decisions of this Court in Choeth Ram v. Shri Deep Chand Jain and another 1977 (1) RCR (Rent) 499; Ram Kumar Khanna of Ludhiana v. Rajiv Garg, 1989 HRR 153 and M/s Bajaj Auto Limited v. Behari Lal Kohli, 1989 (4) SCC 39. Learned senior counsel for the respondent, on the other hand, has submitted that since the lease deed in question was for a period of 11 months, the same did not require registration and hence, was admissible in evidence. As per the lease deed, only half of the portion of the shed had been rented out to the defendants but later on they started using the entire shed in dispute and hence, were liable to pay damages for the remaining portion. In support of his arguments, learned senior counsel for the respondent has placed reliance R.S.A.No. 3736 of 2001 7 on the decision of this Court in Jagdish Chand v. Surinder Kumar, 2005(1) RCR (Civil) 1. After hearing learned counsel for the parties, I am of the opinion that the present appeal deserves to be dismissed. Section 107 of the Transfer of Property Act, 1882 (for short 'the Act'), reads as under:- “Lease how made- 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 leases of immovable property may be made either by a registered instrument or by oral agreement accompanied by delivery of possession. Where a lease of immovable property is made by a registered instrument, such instrument or, where there are more instruments than one, each such instrument shall be executed by both the lessor and the lessee; Provided that the State Government may from time to time, by notification in the Official Gazette, direct that leases of immovable property, other then leases from year to year, or for any term exceeding one year, or reserving a yearly rent, or any class of such leases, may be made by unregistered instrument or by oral agreement without delivery of possession.” The question that requires consideration is as to whether R.S.A.No. 3736 of 2001 8 in the present case, the sale deed Ex.P-8 was required to be registered or not. The said lease deed is for less than a year and as per Section 107 of the Act, the same could be made by a registered instrument or by an oral agreement. It is only the lease deed which is for more than a year that is required compulsory registration. The Apex Court in Satish Kumar v. Zarif Ahmed and others (1997) 3 Supreme Court Cases 679, held as under:- “9. xx xx xx xx xx xx xxx xx The combined effect of all the provisions is that an unregistered lease deed executed from month to month, for a period not exceeding 11 months, through reduced to writing and possession is delivered thereunder to a tenant, is not a compulsorily registerable instrument and, therefore, the prohibition contained in Section 49 of the Registration Act is inapplicable. Therefore, the document is admissible in evidence to consider the effect of the immovable property contained therein or to receive as an evidence of any transaction vis-a-vis such property.” Similarly, this Court in Jagdish Chand's case (supra) held as under:- “7. After hearing the learned counsel, I am of the R.S.A.No. 3736 of 2001 9 considered view that this petition does not warrant admission. It is well settled that a lease deed executed for month to month tenancy or for a period of 11 months, though reduced to writing may not require compulsory registration even if possession of tenanted premises might have been delivered to the tenant.” Thus the judgments relied upon by learned counsel for the appellants fail to advance the case of the appellants in view of the decision of the Apex Court in Satish Kumar's case (Supra), wherein, the point of controversy was directly considered by the Apex Court. Since the lease deed Ex.P-8 was not required to be registered as per Section 107 of the Act, the terms and conditions of the lease deed can be taken in consideration. As per the lease deed, only shaded portion of the shed in question was given on rent to the defendants. The rate of rent was fixed at Rs.3,000/- per month. It was also submitted in the lease deed (Ex.P-8) clause (ix) that in case second party (defendants) made use of any portion of the first party (plaintiff), the second party would pay double the amount of lease money each month accordingly as damages in lieu of other losses, damages incurred by the first party. Admittedly, the defendants were using the entire portion of the shed in question. The case of the defendants is that they R.S.A.No. 3736 of 2001 10 were, in fact, let out the entire shed in question and in lease deed Ex.P-8, it has been shown that only the shaded portion has been let out with a view to circumvent the terms and conditions of the lease deed executed by the Administration (CITCO) in favour of the plaintiff. However, the said defence taken by the defendants is liable to be discarded in view of the specific terms and conditions of the lease deed Ex.P-8. In the presence of documentary evidence, the oral evidence to the effect that, in fact, the entire premises had been let out to the defendants cannot be relied upon. Moreover, some thing which was prohibited by law could not be taken up as a defence by the defendants. Since the defendants had been using the entire shed in question, although half of the portion of the shed had been rented out to them, the Courts below rightly held that the plaintiff was entitled to claim damages. The damages fixed by the Courts below cannot be said to be exorbitant. The plaintiff was also entitled to receive interest on the amount of damages. No substantial question of law arises in this regular second appeal. Accordingly, the same is dismissed. (SABINA) JUDGE August 07, 2009 anita