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Apeejay House Pvt. Ltd. Vs. Punjab National Bank - Court Judgment

LegalCrystal Citation
CourtKolkata High Court
Decided On
Judge
AppellantApeejay House Pvt. Ltd.
RespondentPunjab National Bank
Excerpt:
.....court : the defendant in the eviction suit complains of the exorbitant amount assessed by the special referee on account of mesne profits in respect of an area of about 13,000 sq.ft on the fourth floor at premises no.15, park street, kolkata – 700 016. the defendant has not carried an independent challenge to the report of the special referee but has questioned the quantum assessed in opposition to the application by the plaintiff for a decree in terms of the special referee’s report. the defendant bank says that it would be evident from the report that the highest rate paid by any tenant at the said property was by dena bank of about rs.150 per sq.ft per month in cours.of its occupation of the ground and mezzanine floors of the building. the defendant asserts that the component.....
Judgment:

O-116 GA No.335 of 2013 CS No.302 of 2005 IN THE HIGH COURT AT CALCUTTA Ordinary Original Civil Jurisdiction APEEJAY HOUSE PVT.LTD.Versus PUNJAB NATIONAL BANK BEFORE: The Hon'ble JUSTICE SANJIB BANERJEE Date : 3rd November, 2016.

Appearance: Mr.Abhrajit Mitra, Sr.Adv.Mr.D.N.

Chowdhury, Adv.Mr.Aritra Basu, Adv.Mr.Joydeep Kar, Sr.Adv.Mr.Siddhartha Banerjee, Adv.Mr.Victor Dutta, Adv.The Court : The defendant in the eviction suit complains of the exorbitant amount assessed by the special referee on account of mesne profits in respect of an area of about 13,000 sq.ft on the fourth floor at premises no.15, Park Street, Kolkata – 700 016.

The defendant has not carried an independent challenge to the report of the special referee but has questioned the quantum assessed in opposition to the application by the plaintiff for a decree in terms of the special referee’s report.

The defendant bank says that it would be evident from the report that the highest rate paid by any tenant at the said property was by Dena Bank of about Rs.150 per sq.ft per month in couRs.of its occupation of the ground and mezzanine floors of the building.

The defendant asserts that the component of Rs.150 included the municipal rates and taxes and the service tax.

According to the defendant, since there is no claim by the plaintiff on account of municipal rates and taxes and rent at the originally agreed rate had been tendered for the entire duration till June 30, 2010 that the defendant bank was in occupation of the suit premises, the assessment made by the special referee is clearly flawed.

The bank suggests that the fair letting-out value of the suit premises between 2005-2008 would not have exceeded Rs.50 or 60 per sq.ft per month and even if the 15 per cent increase provided for in 2008 is accepted, the assessment ought to have been to the extent of about Rs.60 or 70 per sq.ft per month for the period of 2008-2010.

The bank seeks to rely on the evidence that was carried before the special referee, including some papers that may not even have been tendered before the special referee.

In a matter of assessing damages or mesne profits, there is an element of guess-work based on certain objective criteria.

The final figure in such a case can never be arrived at with any degree of mathematical precision.

The plaintiff relies on a recent order of June 8, 2015 passed in CS No.140 of 2011 where the reasonable rent for equivalent space on the fiRs.floor of the same building was found by another Bench to be Rs.100 per sq.ft per month for the period 2010-2013.

The plaintiff is agreeable to accept such rate, though the plaintiff indicates that the defendant is not entitled to any reduction in the quantum as suggested by the special referee since the defendant did not take any exception to the report or apply for the same to be set aside.

The defendant is a nationalised bank.

Even though the defendant ought to have applied independently to challenge the report, once the plaintiff has applied for a decree in terms of the special referee’s assessment and a reasonable objection is taken by the defendant thereto as to the quantum and not the entirety of the report, the same cannot be brushed aside merely because an independent challenge was not carried from the report.

Further, the plaintiff in the present case is agreeable to accept mesne profits assessed at a lower rate by a contemporaneous order of this Court.

The special referee’s report of December 18, 2012 refers to Dena Bank paying Rs.150 per sq.ft per month inclusive of municipal rates and taxes and service tax for its occupation at the ground and mezzanine floors of the same building.

The report also refers to Kotak Mahindra Bank paying Rs.83 per sq.ft per month all found for its occupation of a super built-up area of 570 sq.ft on the eighth floor of the building.

The assessment appears to have been made with reference to the varying rates paid by Dena Bank and Kotak Mahindra Bank for occupation of different parts of the same building.

In the order of June 8, 2015 passed in CS No.140 of 2011, the Court noticed that there was a distinction between mesne profits and fair rent on the basis of a Supreme Court judgment reported at 2004 (5) SCC304 The Court also found that the assessment in that case was for a period that the defendant in that case had been permitted to continue in occupation of the property in question.

On the basis of the material before the special referee in that case as noticed by the Court, it was felt that an amount of Rs.100 per sq.ft per month would be the reasonable fair rent that the plaintiff would be entitled to in that case.

In view of the order dated June 8, 2015 made in similar circumstances, the assessment herein must be similar.

The special referee appears to have erred in part in taking the monthly sum of Rs.150 per sq.ft paid by Dena Bank as a yardstick since the total amount included the municipal rates and taxes and the service tax component.

It does not appear from the report as to whether the monthly amount of Rs.83 per sq.ft paid by Kotak Mahindra Bank also included all other charges and taxes.

The two periods for which mesne profits were assessed in this case were October 24, 2005 to October 23, 2008 and October 24, 2008 to June 30, 2010.

For the fiRs.period, the special referee held that the plaintiff ought to be awarded Rs.100 per sq.ft per month as mesne profits and for the second period, Rs.115 per sq.ft per month.

The defendant does not object to the 15 per cent increase but merely questions the quantum in either case.

Going by the sum of Rs.100 per sq.ft per month found to be the reasonable letting out value or the fair rent for occupation elsewhere in the same building, the fair rent for the period 2008 to 2010 should stand reduced by about 10 per cent and assessed to be Rs.91/- per sq.ft per month.

Similarly, the amount for the initial period should stand reduced by about 15 per cent for the fair rent for such period to be about Rs.77/- per sq.ft per month.

These figures have been arrived at by relying on the general principles of about 10 per cent increase for every three years and the acceptance by the defendant of the 15 per cent increase applied by the special referee in this case between the two periods indicated in the special referee’s report.

Accordingly, GA No.335 of 2013 is disposed of by holding that the plaintiff is entitled to mesne profits at the rate of Rs.77 per sq.ft per month for the suit premises for the period October 24, 2005 to October 23, 2008 less the amount that may have already been paid by the defendant to the plaintiff in such regard and further that the plaintiff is entitled to mesne profits at the rate of Rs.91 per sq.ft per month for the period October 24, 2008 to June 30, 2010, again less any sum that may have been already paid by the defendant to the plaintiff in such regard.

The rates of Rs.77 per sq.ft per month and Rs.91 per sq.ft per month do not include the municipal rates or any other tax and cover only the rent component.

The plaintiff will also be entitled to recover the service tax component from the defendant for the relevant periods in accordance with law.

There will be no order as to costs.

(SANJIB BANERJEE, J.) kc.


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