Delhi High Court: In a case where the Trial Court directed the tenants ‘appellants herein' to pay the defaults in rent, which was due in COVID, the Division Bench of Saurabh Banerjee, and Suresh Kumar Kait, JJ. upheld the same as the tenants willingly chose to retain the possession of the premises and as there was no clause in the Lease Deed giving any suspension, thus, the appellant was bound to pay the monthly charges to the landlord in terms of the clear stipulations contained in the Lease Deed.
The respondent-landlord had given the said premises on lease to the appellant-tenants to carry out authorized commercial activity like running a spa or any other activity vide a registered Lease Deed dated 18-12-2010 (‘Lease Deed') for a period of 15 years, commencing from 15-05-2010 to 14-05-2025. During the subsistence of the aforesaid Lease Deed, COVID-19 pandemic spread across India and the lockdown prevailed from March, 2020 for the ensuing months, thus resulting in non-payment of rent.
The respondent issued legal notice(s) on 20-04-2020, 11-05-2020 and 28-05-2020 for payment of rent, even offering suspension of payment for 60 days on compassionate grounds which went unanswered. The tenants, however, continued to stay on the premises till termination of the Lease Deed which was was thereby terminated vide notice 07-06-2020. A reply was sent to the landlord denying the liability by taking plea of force majeure as per Clause 14 of the Deed.
An application under Order XIII A Civil Procedure Code, 1908 (‘CPC') r/w Section 151, CPC read with Section 3 Commercial Courts Act, 2015 ‘Order XIII A application' was filed by the landlord which was decreed in favour of them. Being aggrieved, the appellant challenged the impugned judgement on three basic grounds.
1. The Trial court had overlooked the fact that the premises was ‘unfit to use' alleging thereby that because of the then prevailing lockdown situation during the period in dispute and passing of different circular(s) issued by various Government(s) from time to time the appellant was unable to carry on the activity of running a Spa from the said premises.
2. The Trial Court had wrongly applied the provision of Section 108(e) of the Transfer of Property Act, 1882 even though the parties were admittedly bound by the terms of the Lease Deed executed inter-se and that the Transfer of Property Act, 1882 was not applicable to the facts and circumstances of the case.
3. As there was no commercial use of the premises permissible and/ or possible during the aforesaid period in the dispute before the learned trial court, the respondent was not entitled to rent for the said period.
What is Order XIII A CPC?
The Court noted that the said provision of Order XIII A was introduced in the CPC by way of an amendment in the year 2015 with respect to all kinds of commercial disputes only. The said Order XIII A, CPC is a provision enabling the courts to take up and decide claim(s) in the commercial disputes without recording oral evidence, i.e., without following the ordinary procedure to be adopted and followed in an ordinary suit. Two fundamental grounds which have to be satisfied while deciding an Order XIII A application are that a party has to show that the other party has no real prospect of succeeding in and/ or defending the claim and that there is no other compelling reason as to why the claim should not be disposed of before commencement of trial, i.e., recording of oral evidence.
Observation and Analysis
The Court noted that on a careful analysis, it emerges that the provision of Order XIII A, CPC has been specifically introduced by the Legislature so as to adjudicate and decide the issue(s) at the threshold itself without proceeding to the unnecessary rigors of a prolongated trial and to save time, effort and money by making it more convenient and expeditious for all concerned, be it the court(s) and/ or the parties involved. Furthermore, an Order XIII A application can be allowed, and a court can proceed to pass a summary judgment if a party has a real prospect of succeeding and/ or defending in the claim and there is no real purpose of proceeding to trial, i.e., recording oral evidence.
The Court further noted that the appellant is merely trying to reagitate the same issues in the form of grounds which have all been heard, taken note of and decided by the Trial Court in the impugned judgment, by simply giving a different flavour to them.
The Court observed that there clearly exists a relationship of respondent-landlord and the appellant-tenant and they are bound by terms of Lease Deed. Since the appellant neither chose to exercise his right to terminate the Deed nor chose to vacate the said premises until termination, thus, there is no such clause in the Deed to claim non-payment of rent. Thus, the appellant was well and truly liable to pay the lease rentals as per the Lease Deed along with interest thereon for the period in issue.
On the issue of the premises being unfit for use due to COVID and the then prevailing lockdown, the Court opined that the premises were always fit to use, and the appellant was free to carry on any kind of commercial activity barring running a Spa. The Court premised this on a well settled law that temporary non-use of premises during the lock down period cannot be construed as rendering either the stipulated term of the Lease Deed void or giving any benefit to the tenant to claim suspension of rent on the ground of mere non-use thereof.
The Court remarking that Section 108(e) of The Transfer of Property Act, 1882 is inapplicable to the facts of the instant case, held, as the appellant willingly chose to retain the possession of the premises and as there was no clause giving any respite to it, the appellant was bound to pay the monthly charges to the respondent in terms of the clear stipulations contained in the Lease Deed.
[Siddhatha Singh v. Ajit Singh Bawa, 2022 SCC OnLine Del 2007, decided on 12-07-2022]
Advocates who appeared in this case :
Mr. Harsh Gokhale, Advocate, for the Appellant.
*Arunima Bose, Editorial Assistant has reported this brief.