“The Supreme Court has ruled that tenants who continue to occupy a property after their lease has expired must compensate the landlord by paying ‘mesne profits’.”

Facts of the Case:

Bijay Kumar Manish Kumar HUF has filed special leave petitions (SLPs) challenging a judgment of the Calcutta High Court concerning a property located in Kolkata’s commercial hub, Dalhousie area. The dispute stems from non-payment of rent and the termination of a lease agreement executed on 23rd February 1991 by the petitioner’s predecessor-in-interest. According to the petitioner, the respondent has failed to pay rent since 2002 and has not made municipal tax payments since 1996. Despite the lease being forfeited or terminated due to rent non-payment, the respondent has neither surrendered possession of the property nor settled the rent.

Issues Framed by the Court:

1. Determining whether the West Bengal Tenancy Act 1997 or the Transfer of Property Act 1882 applies to framing issues in the landlord-tenant dispute.

2. Whether the disposal of interlocutory applications seeking direction for payment of rent and associated benefits.

Provisions mentioned:

1. West Bengal Tenancy Act, 1997: This legislation governs the rules and regulations concerning the leasing of land in the Indian state of West Bengal.

2. Transfer of Property Act, 1882: This law outlines the legal framework for the transfer of immovable property in India through methods such as sale, mortgage, lease, and gift.

3. Article 227 of the Constitution of India: This article confers upon High Courts the power of superintendence over all courts and tribunals within the territories over which they have jurisdiction.

4. Order VII Rule 11 CPC: This rule provides provisions for the rejection of plaints under the Civil Procedure Code (CPC).

Arguments by Appellant:

The appellant is contesting the judgment and order of the Calcutta High Court, which determined that the West Bengal Tenancy Act, 1997 should apply to the landlord-tenant dispute instead of the Transfer of Property Act, 1882. The appellant contends that the reasoning of the learned Single Judge in the High Court exceeds the scope of the current adjudication. Interlocutory applications have been filed seeking directives regarding the payment of rent and related entitlements concerning the contested property involved in the present dispute.

Arguments by Respondents:

The respondent contends that the property in question should fall under the jurisdiction of the Tenancy Act and requests the dismissal of the petitioner’s plaint. They argue that the dispute ought to be governed by the West Bengal Tenancy Act, 1997, rather than the Transfer of Property Act, 1882. The respondent raises objections regarding the legality and adequacy of the plaint submitted by the petitioner, including concerns about valuation and stamp duty.

Decision of the Court:

In this instance, the Supreme Court addressed interim applications seeking instructions for rent payment and related benefits concerning the leased premises, pending the adjudication of Special Leave Petitions. The court considered several factors, including the premises’ location, agreed-upon rent, allegations of rent non-payment, and defaults in interest payments. Following the petitioner’s submission of calculated dues during the hearing, the court approved these calculations. It ordered the respondent to deposit Rs.5,15,05,512/- with the Court’s Registry within four weeks. Non-compliance would lead to legal consequences for willful disobedience. The Registry was directed to invest the received amount in a short-term, interest-bearing fixed deposit. Additionally, similar interim applications in other Special Leave Petitions were resolved on the same terms as the aforementioned case. The court scheduled hearings for the Special Leave Petitions in July 2024.

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