IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH 130 Ashoka Fruit Company & Another Chander Mohan Khanna CORAM: Present:- NIDHI GUPTA, J. laying challenge to the order dated 08.04.2025 passed by learned Appellate Authority whereby application filed by the respondent/landlord for grant of mesne profits has been allowed; and the petitioner has been directed to pay mesne profits at the rate of Rs.35,000/ 2. respondent and file 3. petitioner that respect of the present demised premises, vide order dated 02.01.2019 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Ashoka Fruit Company & Another Vs. Chander Mohan Khanna HON’BLE MS. JUSTICE NIDHI GUPTA Mr. Divanshu Jain, Advocate Mr. Minkal Rawal, Advocate Mr. Abhinav Geol, Advocate Mr. Arun, Advocate for the petitioners. Mr. Prateek Gupta, Advocate for the respondent. *** NIDHI GUPTA, J. Present revision petition laying challenge to the order dated 08.04.2025 passed by learned Appellate Authority whereby application filed by the respondent/landlord for grant of mesne profits has been allowed; and the petitioner has been directed to pay mesne profits at the rate of Rs.35,000/- per month. Mr. Prateek Gupta, Advocate appear respondent and files Power of Attorney, which is taken on record. It is inter alia submitted by learned counsel for the petitioner that in the earlier round of litigation between the parties in respect of the present demised premises, vide order dated 02.01.2019 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CR-2746-2025(O&M) Date of decision: 06.05.2025 ...Petitioner(s) ...Respondent(s) HON’BLE MS. JUSTICE NIDHI GUPTA , Advocate Mr. Minkal Rawal, Advocate Mr. Abhinav Geol, Advocate Mr. Prateek Gupta, Advocate petition has been filed by the tenant laying challenge to the order dated 08.04.2025 passed by learned Appellate Authority whereby application filed by the respondent/landlord for grant of mesne profits has been allowed; and the petitioner has been directed to per month. Mr. Prateek Gupta, Advocate appears on behalf of the Power of Attorney, which is taken on record. It is inter alia submitted by learned counsel for the in the earlier round of litigation between the parties in respect of the present demised premises, vide order dated 02.01.2019 6 tenant laying challenge to the order dated 08.04.2025 passed by learned Appellate Authority whereby application filed by the respondent/landlord for grant of mesne profits has been allowed; and the petitioner has been directed to on behalf of the It is inter alia submitted by learned counsel for the in the earlier round of litigation between the parties in respect of the present demised premises, vide order dated 02.01.2019 SUNENA 2025.05.07 13:49 I attest to the accuracy and integrity of this document (Annexure P1), the learned Appellate Authority had assesse at the rate of Rs.25,000/ petitioner before this Court by way of Civil Revision No.576 of 2019 which, while issuing notice of motion (Annexure P2), this Court stayed the amount of mesne profit beyond a sum of Rs.7,000/- what weighed with the learned Single Judge, was that the Hon’ble Supreme Court in Ram Chauhan & Others” Law Finder Doc ID # 253506 that:- (Annexure P1), the learned Appellate Authority had assesse at the rate of Rs.25,000/- per month. The said order was challenged by the petitioner before this Court by way of Civil Revision No.576 of 2019 which, while issuing notice of motion (Annexure P2), this Court stayed the amount of mesne profit beyond a sum - per month. It is submitted that in issuing the said direction what weighed with the learned Single Judge, was that n’ble Supreme Court in Mohammad Ahmad Ram Chauhan & Others” Law Finder Doc ID # 253506 “21. According to our considered view majority of these cases are filed because landlords do not get reasonable rent akin t market rent, then on one ground or the other litigation is initiated. So before saying omega, we deem it our duty and obligation to fix some guidelines and norms for such type of litigation, so as to minimise landlord levels. These are as follows :- (i) The tenant must enhance the rent according to the terms of the agreement or at least by ten percent, after every three years and enhanced rent should then be made payable to the landlord. If the rent is too low (in comparison to market rent), having been fixed almost 20 to 25 years back then the present market rate should be worked out either on the basis of valuation report or reliable estimates of building rentals in the surrounding areas, let out on rent recently. Page 2 of 6 (Annexure P1), the learned Appellate Authority had assessed mesne profits per month. The said order was challenged by the petitioner before this Court by way of Civil Revision No.576 of 2019; in vide order dated 25.01.2019 (Annexure P2), this Court stayed the amount of mesne profit beyond a sum submitted that in issuing the said direction what weighed with the learned Single Judge, was that as per judgment of Mohammad Ahmad& Another Vs. Atma Ram Chauhan & Others” Law Finder Doc ID # 253506 it has been directed 21. According to our considered view majority of these cases are filed because landlords do not get reasonable rent akin to market rent, then on one ground or the other litigation is initiated. So before saying omega, we deem it our duty and obligation to fix some guidelines and norms for such type of litigation, so as to minimise landlord-tenant litigation at all (i) The tenant must enhance the rent according to the terms of the agreement or at least by ten percent, after every three years and enhanced rent should then be made payable to the landlord. If the rent is too low (in arket rent), having been fixed almost 20 to 25 years back then the present market rate should be worked out either on the basis of valuation report or reliable estimates of building rentals in the surrounding areas, let out on rent recently. ………” 6 d mesne profits per month. The said order was challenged by the ; in vide order dated 25.01.2019 (Annexure P2), this Court stayed the amount of mesne profit beyond a sum submitted that in issuing the said direction as per judgment of & Another Vs. Atma it has been directed 21. According to our considered view majority of these cases o market rent, then on one ground or the other litigation is initiated. So before saying omega, we deem it our duty and obligation to fix some guidelines and norms for such type of tenant litigation at all (i) The tenant must enhance the rent according to the terms of the agreement or at least by ten percent, after every three years and enhanced rent should then be made payable to the landlord. If the rent is too low (in arket rent), having been fixed almost 20 to 25 years back then the present market rate should be worked out either on the basis of valuation report or reliable estimates of building rentals in the surrounding SUNENA 2025.05.07 13:49 I attest to the accuracy and integrity of this document 4. judgment the mesne profits could have been enhanced only at the rate of 10% every three years. petitioner in the year 1983 at applying the ratio of the above said judgment, the 10% increase every three years following would have been the rent as on date: 5. Rs.6,272/- per month as mesne profits by this Court vide order dated 25.01.2019; and as per the above calculation, the petitioner can now only be directed to pay Rs.7,589/ 6. impugned order It is contended that accordingly, the mesne profits could have been enhanced only at the rate of 10% every three years. Thus, as the demised premises were let out to the petitioner in the year 1983 at rent of Rs.2,000/ applying the ratio of the above said judgment, the 10% increase every three years following would have been the rent as on date: YEAR RENT 1983 Rs.2,000/ 1986 Rs.2,200/ 1989 Rs.2,420/ 1992 Rs.2,662/ 1995 Rs.2,928/ 1998 Rs.3,220/ 2001 Rs.3,542/ 2004 Rs.3,896/ 2007 Rs.4,285/ 2010 Rs.4,713/ 2013 Rs.5,184/ 2016 Rs.5,702/ 2019 Rs.6,272/ 2022 Rs.6,899/ 2025 Rs.7,589/ At present Rs.7,589/ Accordingly, in2019, the petitioner was liable to per month as mesne profits, which was rounded off to Rs.7,000/ by this Court vide order dated 25.01.2019; and as per the above calculation, the petitioner can now only be directed to pay Rs.7,589/ Ld. Counsel further submits impugned order would reveal that the exorbitant mesne profits have been It is contended that accordingly, in terms of above-said the mesne profits could have been enhanced only at the rate of the demised premises were let out to the of Rs.2,000/- per month, therefore, applying the ratio of the above said judgment, the 10% increase every three years following would have been the rent as on date:- Rs.2,000/- Rs.2,200/- Rs.2,420/- Rs.2,662/- Rs.2,928/- Rs.3,220/- Rs.3,542/- Rs.3,896/- Rs.4,285/- Rs.4,713/- Rs.5,184/- Rs.5,702/- Rs.6,272/- Rs.6,899/- Rs.7,589/- Rs.7,589/- per month ccordingly, in2019, the petitioner was liable to pay which was rounded off to Rs.7,000/- by this Court vide order dated 25.01.2019; and as per the above calculation, the petitioner can now only be directed to pay Rs.7,589/- per month. Ld. Ld. Counsel further submits that a bare reading of the the exorbitant mesne profits have been 6 said the mesne profits could have been enhanced only at the rate of the demised premises were let out to the month, therefore, applying the ratio of the above said judgment, the 10% increase every three pay - by this Court vide order dated 25.01.2019; and as per the above calculation, the the exorbitant mesne profits have been SUNENA 2025.05.07 13:49 I attest to the accuracy and integrity of this document fixed without any basis. that the 2 reference Lease Deeds were unregistered documents terms of judgment of this Court in Finder Doc ID # 122785 documents could not have been made the basis for determining the profits. Further, the said ground that the properties therein were not situated in the vicinity of the demised property properties in the Lease Deeds and the subject property in the pr did not match. which the learned Appellate Authority has profits. It is submitted that the said figure has been literally pulled out of the air by the Appell Hon’ble Supreme Court in down that rate of rent “ valuation report or reliable estimates of building rentals in areas, let out on rent recently 7. rebuts the submissions made on behalf of the petitioner and submits that the respondent had produced 2 reference Lease Deeds, the first being Lease Deed dated 02.03.2023 (Annexure P8) Grain Market, Sector 26, Chandigarh fixed without any basis. It is categorically recorded the 2 reference Lease Deeds were unregistered documents terms of judgment of this Court in “Surinder Kumar Vs. Rattan Lal” Law Finder Doc ID # 122785, the said Lease Deeds could not have been made the basis for determining the Further, the said reference Lease Deeds were rejected also on the ground that the properties therein were not situated in the vicinity of the property; and because the square feet area of the in the Lease Deeds and the subject property in the pr did not match. It is stated that therefore, there was no basis whatsoever on the learned Appellate Authority has It is submitted that the said figure has been literally pulled out of the air by the Appellate Authority; which is in clear violation of judgment of Hon’ble Supreme Court in Mohammad Ahmad rate of rent “should be worked out either on the basis of valuation report or reliable estimates of building rentals in areas, let out on rent recently.” Learned counsel appearing on behalf of the respondent rebuts the submissions made on behalf of the petitioner and submits that the respondent had produced 2 reference Lease Deeds, the first being Lease Deed dated 02.03.2023 (Annexure P8) which is in respect of Grain Market, Sector 26, Chandigarh. It is submitted that recorded in the impugned order, the 2 reference Lease Deeds were unregistered documents. Thus, in “Surinder Kumar Vs. Rattan Lal” Law the said Lease Deeds being unregistered could not have been made the basis for determining the mesne reference Lease Deeds were rejected also on the ground that the properties therein were not situated in the vicinity of the the square feet area of the reference in the Lease Deeds and the subject property in the present case, there was no basis whatsoever on the learned Appellate Authority has fixed the impugned mesne It is submitted that the said figure has been literally pulled out of which is in clear violation of judgment of Mohammad Ahmad (supra) wherein it is laid should be worked out either on the basis of valuation report or reliable estimates of building rentals in the surrounding appearing on behalf of the respondent rebuts the submissions made on behalf of the petitioner and submits that the respondent had produced 2 reference Lease Deeds, the first being Lease which is in respect of SCF No.159, It is submitted that therefore, the said 6 in the impugned order, in “Surinder Kumar Vs. Rattan Lal” Law being unregistered mesne reference Lease Deeds were rejected also on the ground that the properties therein were not situated in the vicinity of the reference , there was no basis whatsoever on fixed the impugned mesne It is submitted that the said figure has been literally pulled out of which is in clear violation of judgment of it is laid should be worked out either on the basis of the surrounding appearing on behalf of the respondent rebuts the submissions made on behalf of the petitioner and submits that the respondent had produced 2 reference Lease Deeds, the first being Lease SCF No.159, the said SUNENA 2025.05.07 13:49 I attest to the accuracy and integrity of this document Lease Deed learned Appellate Authority Lease Deed i.e. 100 feet away from the demised shop UT Chandigarh. Lease Deed has paid at the rate of Rs.80,000/ the present demised shop, learned Appellate Authority has directed only Rs.35,000/ that the second respect of SCF No.16, Sector 26, Sabzi Mandi, Chandigarh unregistered Lease Deed and was accordingly rightl Appellate Authorit 8. that Lease Deed dated 02.03.2023 (Annexure P8) is However, submits that upon as the area of the said property is about 312.5 square feet; whereas the demised premises is merely a Farh/Thara with Gaddi situated on the ground floor and one room and one store on the first floor of SCF No.3, Sector 26, Grain Market accordingly prayed that the matter be remanded back to the learned Appellate Authority for reconsideration being a registered document learned Appellate Authority. Moreover, the i.e. SCF No.159, Grain Market, Sector 26, Chandigarh is a mere 100 feet away from the demised shop viz SCF No.3, Sector 26, Grain Market, UT Chandigarh. Furthermore, SCF no.159, subject property has a carpet area of 312.5 square yard, paid at the rate of Rs.80,000/- per month. W the present demised shop, learned Appellate Authority has directed Rs.35,000/- per month, which is less than half. It is however admitted second reference Lease Deed dated 12.02.2024 (Annexure P9) respect of SCF No.16, Sector 26, Sabzi Mandi, Chandigarh unregistered Lease Deed and was accordingly rightl Appellate Authority. At this stage, learned counsel for the petitioner Lease Deed dated 02.03.2023 (Annexure P8) is However, submits that the said Lease Deed (Annexure P8) cannot be relied the area of the said property is about 312.5 square feet; whereas the demised premises is merely a Farh/Thara with Gaddi situated on the ground floor and one room and one store on the first floor of SCF No.3, Sector 26, Grain Market, which is being shared accordingly prayed that the matter be remanded back to the learned Appellate Authority for reconsideration in accordance with law. Page 5 of 6 was wrongly rejected by the the subject property of the said SCF No.159, Grain Market, Sector 26, Chandigarh is a mere SCF No.3, Sector 26, Grain Market, SCF no.159, subject property in the reference a carpet area of 312.5 square yard, for which rent was being . Whereas for the smaller area of the present demised shop, learned Appellate Authority has directed to pay per month, which is less than half. It is however admitted reference Lease Deed dated 12.02.2024 (Annexure P9) in respect of SCF No.16, Sector 26, Sabzi Mandi, Chandigarh was an unregistered Lease Deed and was accordingly rightly discarded by the At this stage, learned counsel for the petitioner admits Lease Deed dated 02.03.2023 (Annexure P8) is a registered document. the said Lease Deed (Annexure P8) cannot be relied the area of the said property is about 312.5 square feet; whereas the demised premises is merely a Farh/Thara with Gaddi situated on the ground floor and one room and one store on the first floor of SCF No.3, which is being shared by 3 persons. It is accordingly prayed that the matter be remanded back to the learned in accordance with law. 6 wrongly rejected by the said SCF No.159, Grain Market, Sector 26, Chandigarh is a mere SCF No.3, Sector 26, Grain Market, the reference rent was being hereas for the smaller area of to pay per month, which is less than half. It is however admitted in was an y discarded by the admits registered document. the said Lease Deed (Annexure P8) cannot be relied the area of the said property is about 312.5 square feet; whereas the demised premises is merely a Farh/Thara with Gaddi situated on the ground floor and one room and one store on the first floor of SCF No.3, It is accordingly prayed that the matter be remanded back to the learned SUNENA 2025.05.07 13:49 I attest to the accuracy and integrity of this document 9. 10. impugned order 11. matter however, counsel for the parties, Appellate Authority for profits payable by the petitioner brought on record by the parties 12. 13. 06.05.2025 Sunena Whether speaking/reasoned: Whether reportable: Heard. From the facts as noted above, it impugned order suffers from material errors of fact. As such, without commenting on the merits matter however, in the interest of justice, and with the consent of learned counsel for the parties, the matter is remanded back to the learned Appellate Authority for reconsideration; and re profits payable by the petitioner after considering brought on record by the parties, within a period of 2 months from today. Present petition stands disposed of Pending application(s) if any also stand(s) disposed of. Whether speaking/reasoned: Yes/No Whether reportable: Yes/No From the facts as noted above, it would appear that the material errors of fact. As such, without commenting on the merits of the and with the consent of learned the matter is remanded back to the learned and re-assessment of the mesne after considering the entire material within a period of 2 months from today. disposed of in above terms. Pending application(s) if any also stand(s) disposed of. (Nidhi Gupta) Judge 6 that the of the and with the consent of learned the matter is remanded back to the learned of the mesne the entire material SUNENA 2025.05.07 13:49 I attest to the accuracy and integrity of this document