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Supreme Court upholds Delhi High Court order on tenanted premises

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The Supreme Court has recently upheld the order of the Delhi High Court which had dismissed a plea of Ahuja Trading Company/ Tenant by imposing a heavy cost of Rs 50,000 while observing that dishonest litigants cannot be allowed to abuse the process of law.

The Delhi High Court had noted that the tenant approached the court after many years and suppressed the material facts, also raised the objection of jurisdiction of Additional Rent Controller (ARC) Court for the first time before it. 

A two-judge bench of Justice S. Abdul Nazeer and J. Aniruddha Bose heard a plea of Ahuja Trading Company, the tenant, who approached against the single judge order of Delhi High Court wherein their plea for seeking stay of warrant of execution issued in terms of order/decree dated July 12, 2010, was rejected. 

In fact, by way of compromised deed, there was a settlement arrived between landlord Ramesh Chandra Aggarwal and tenant Ahuja Trading Company, wherein the tenant was given time period of 10 years to stay in the premises. Yet, the tenant enjoyed that right for 10 years and when the time came for Ahuja Trading Co. to leave the premises, the petitioner Ahuja Trading Co. chose to stay at premises and raised objection of jurisdiction of ARC Court, observed the single judge Justice Amit Bansal of Delhi High Court.

While dismissing the appeal preferred by Ahuja Trading Company, the single judge opined that once the tenant has agreed to enter into compromise agreement with the landlord voluntarily, the same is binding upon both tenant and landlord, thus tenant cannot breach or dishonour the compromise deed and not even the consent decree of the court. Such act and conduct of the tenant/litigants is scrupulous and in any manner, tenant cannot be allowed to abuse process of the court.

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Ahuja Trading company was given 10 years time to vacate the said premises by virtue of compromise deed that lead to court decree passed by ARC on July 12, 2010, noted the single judge of Delhi High Court.

The tenant had challenged for the very first time the jurisdiction of ARC Court under Delhi Rent Control Act.

The genesis of the present matter is that Ramesh Chandra Aggarwal, the landlord, filed eviction petition against Ahuja Trading Company, tenant herein and the same was allowed by ARC, Tis Hazari Court, New Delhi as tenant failed to file leave to defend. Landlord Aggarwal filed execution petition before the ARC, Tis Hazari, New Delhi.

Ahuja Trading Co put forth its stand before the Delhi High Court , contending that in view of Order XXI Rule 22 of CPC, 1908, execution petition was filed after 2 years, much after the decree was passed by ARC Court. The disputed property is the shop located in Gali Sehtara, Ajmeri Gate.

The Delhi Rent Control Act Provisions are also not applicable, relied upon Sunder Dass (1999) judgment of apex court. Such judgment emphasized upon the court’s role to go deeper into the inherent jurisdiction, when such party disputes the jurisdiction of the court, were the contentions of Ahuja Trading Co.

On the other hand, Ramesh Chandra Aggarawal raised his arguments before the court stating that both tenant and landlord arrived to the terms of settlement by way of entering into a compromise deed. And despite sending notice to tenant about filing of execution, the tenant never appeared.

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Further, the contentions of Aggarwal were that the tenant did not invoke his remedy by filing an appeal under section 38 of Delhi Rent Control Act, this petition of Ahuja under Article 227 is not sustainable, while the landlord placed reliance on Usha International Ltd. (2012) Judgement.

Aggarwal relied upon UP State Agro Industrial Corporation Ltd judgment of the Supreme Court, which involved similar facts and circumstances as in the present case is. The apex court in UP State Agro case dismissed the tenant plea who had also challenged eviction on basis of nullity of consent decree.

The operative portion of consent decree of ARC Court, in particular further read as mentioned below: –

“In view of the above, as both the parties have agreed that the rate of rent of the suit property shall be Rs 1725 p m w.e.f. 01.09.2010 which shall be increased by 15% after 3 years and the petitioner shall not execute the decree till 10 years on the compliance of aforesaid terms and conditions by the respondent and in this regard the statement of both the parties have been recorded separately, the present petition is disposed of as compromised.” 

Before the Supreme Court, the respondent/owner was represented by Advocates Prabhav Ralli, Shivaz Berry and Swati Setia. 

Slp-Civil-501-2022-10-02-2022

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