Taj Mahal Hotel v. United India Insurance Co. Ltd
- 2022-02-17
Citation- (RC. Rev. 447/2017)
Judge: Justice Prathiba M. Singh
Facts:
Ramanand and others (“Appellants”) ran a shoe store called ‘Baluja’ in Khan Market, Delhi, in the tenanted premises leased to them by the landlord, Dr. Girish Soni, through a lease deed executed on February 1, 1975 for a monthly rent ofINR300. In the year 2008, Dr. Girish Soni and another (“Respondents”) filed an eviction petition against the Appellants under Section 14(1)(e) of the Delhi Rent Control Act, 1958 (“DRC Act”). Initially, leave to defend was granted to the Appellants by the Senior Civil Judge-cum-Rent Controller (“RC”) on March 31, 2012. However, by the impugned order dated March 18, 2017, a decree for eviction was passed. The Appellants filed an appeal against the impugned order which was dismissed by the Rent Control Tribunal (“RCT”) by an order dated September 18, 2017 on the ground that the same is not maintainable. Hence, the present petition, challenging the eviction order dated March 18,2017, was filed before the DHC.
The petition was first listed before the DHC on September 25, 2017, on which date the single judge had stayed the order of eviction subject to the Appellants paying the Respondents a sum of INR3.5 lakhs per month in advance for each month by the 10th day of the English calendar, with effect from the month of October, 2017.
Following the outbreak of COVID-19, an application for suspension of rent was moved by the Appellants before the DHC, during the lockdown period. The Appellants stand was that due to the lockdown, there has been complete disruption of all business activities, including the business of the Appellants. It was pleaded that the circumstances were force majeure and beyond the control of the Appellants. Thus, it was claimed that the Appellants were entitled to waiver of the monthly payment directed by DHC’s order dated September 25, 2017, or at least some partial relief in terms of suspension, postponement or part-payment of the said amount.
Issues:
Judgment
In disposing off the appeal, the DHC held the view that there is no rent agreement or lease deed between the parties and hence Section 32 of the ICA has no applicability. The case is governed by the provisions of the DRC. Further, Section 56 of the ICA does not apply to tenancies. The Appellants do not urge that the tenancy is void under Section 180(B)(e) of the TPA. The Appellants are also not ‘Lessees’ as an eviction decree has already been passed against them. Therefore, the Appellants’ application for suspension of rent is thus liable to be rejected inasmuch as while invoking the doctrine of suspension of rent on the basis of a force majeure event, it being clear from the submissions made that the Appellants do not intend to surrender the tenanted premises. While holding that suspension of rent is not permissible in these facts, some postponement or relaxation in the schedule of payment can be granted owing to the lockdown.
It was accordingly directed that the Appellants would pay the use and occupation charges for the month of March, 2020 on or before May 30, 2020 and for the months of April, 2020 and May, 2020 by June 25, 2020. From June 2020 onwards, the payment shall be strictly as per the interim order dated September 25, 2017. Subject to these payments being made, the interim order already granted shall continue. If there is any default in payment, the interim order dated September 25, 2017 would be operational. The said interim order was very clear that if there is any non-payment, the decree would be liable to be executed.
Analysis:
This decision of the Delhi High Court has cleared the air on the applicability of Section 32 of ICA, Section 56 of ICA, and Section 108(B) (e) of TPA on the lease agreements. It is now clear by the aforesaid decision that Section 56 of ICA does not apply to lease agreements. Further, the applicability of Section 108(B)(e) of TPA is subject to the leased property being substantially and permanently destructed due to the Force Majeure event.
