IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 01st DAY OF AUGUST, 2025 PRESENT THE HON'BLE MRS. JUSTICE ANU SIVARAMAN AND THE HON'BLE DR. JUSTICE K.MANMADHA RAO COMMERCIAL APPEAL NO.570 OF 2024 BETWEEN: 1. MR. ANEES-UR-RAHMAN S/O ABDUL REHMAN AGED ABOUT 69 YEARS R/AT No.181, ALBERT STREET RICHMOND TOWN BENGALURU-560 051 2. M/S. TAJ HOTEL A PARTNERSHIP CONCERN HAVING ITS OFFICE AT No.383 JUMMA MASJID ROAD SHIVAJINAGAR, OPH ROAD BENGALURU-560 051 REP. BY ITS PARTNERS MR. ANEES-UR-RAHMAN MRS. JABEES ANEES MR. DANISH ANEES …APPELLANTS (BY SRI. SKANDA KUMAR, ADVOCATE FOR SRI. M.D. RAGHUNATH, ADVOCATE) AND: M/S. AGS TRANSACT TECHNOLOGIES LTD. A COMPANY REGISTERED UNDER COMPANIES ACT, 1956 HAVING OFFICE AT No.601/2 TRADE WORLD, B-WING, KAMALA CITY SENAPATIBAPAT MARG, LOWER PAREL (WEST) - 2 MUMBAI-400 013 REP. BY ITS AUTHORIZED SIGNATORY ALSO AT: No.383, JUMMA MASJID ROAD SHIVAJINAGAR, OPH ROAD BENGALURU-560 051 ALSO AT: GR/2ND FLOOR, No.5 1ST MAIN ROAD, 4TH STAGE 3RD BLOCK BASAVESHWAR NAGAR BENGALURU-560 079 …RESPONDENT (RESPONDENT SERVED AND UNREPRESENTED) THIS COMMERCIAL APPEAL IS FILED UNDER SEC.13(1-A) OF COMMERCIAL COURTS ACT, 2015, PRAYING TO CALL FOR RECORDS AND SET ASIDE THE JUDGMENT AND DECREE PASSED IN COM.OS No.1064/2024 BY LXXXV ADDITIONAL CITY CIVIL AND SESSIONS JUDGE, AT BENGALURU (CCH-86) DATED 01.10.2024 AND ALLOW THE APPEAL THEREBY SETTING ASIDE THE JUDGEMENT AND DECREE, IN THE INTEREST OF JUSTICE AND EQUITY. THIS APPEAL HAVING BEEN HEARD AND RESERVED FOR JUDGMENT ON 03.07.2025 AND COMING ON FOR PRONOUNCEMENT OF JUDGMENT THIS DAY, ANU SIVARAMAN J., PRONOUNCED THE FOLLOWING: CORAM: HON'BLE MRS. JUSTICE ANU SIVARAMAN and HON'BLE DR. JUSTICE K.MANMADHA RAO - 3 CAV JUDGMENT (PER: HON'BLE MRS. JUSTICE ANU SIVARAMAN) The present Commercial Appeal is filed by the appellants/plaintiffs challenging the Judgment and Decree dated 01.10.2024 passed by LXXXV Additional City Civil and Sessions Judge, Bengaluru (CCH-86) ('Commercial Court' for short) in Com. O.S. No.1064/2024. 2. We have heard Shri. Skanda Kumar, learned counsel appearing for the appellants. Though the respondent was duly served with notice of the appeal, there is no appearance for the respondent. 3. For the sake of convenience, the parties are referred to as per their rankings before the Commercial Court. 4. Plaintiff No.2 is a partnership concern and plaintiff No.1 is the absolute owner of the suit schedule property. The plaintiffs and defendant entered into a Leave and License Agreement dated 21.05.2016 over the suit schedule property. The monthly license rent of Rs.39,675/- plus water - 4 and electricity charges was payable on or before 5th of every month. The defendant defaulted in payments leaving arrears of Rs.4,36,425/-. The lease expired on 01.07.2023. Plaintiffs issued a legal notice dated 02.04.2024 to the defendant terminating the tenancy and seeking arrears of rent, electricity and water charges. The plaintiffs instituted Pre- Institution Mediation, which failed due to the defendant's non appearance. Consequently, a suit was filed before the Commercial Court, which was dismissed with costs holding that the agreement being unregistered and insufficiently stamped is a void instrument, inadmissible and unenforceable in law and that no relief can be granted based on such instruments even though defendant is placed ex- parte. Aggrieved by the order of the Commercial Court, the plaintiffs preferred this appeal. 5. The learned Counsel appearing for the plaintiffs contended that the Commercial Court erred in dismissing the suit by failing to consider the provisions of Sections 51, 52, 71, 97, 112, 119 and 122 of the Bhartiya Saksya Adhiniyam, 2023 and Section 35 of the Karnataka Stamp Act, 1957. It - 5 is further submitted that in the absence of registration beyond 11 months, the tenancy should be treated as a month-to-month tenancy under law. The Commercial Court failed to hold that the licensee is estopped from disputing the licensor's ownership and that the burden to prove cessation lies on the defendant, giving rise to presumption of continuation in its absence. 6. It is also contended that the plaintiffs were not given an opportunity to pay the Deficit Stamp Duty, if any, nor was the document referred to the appropriate authority under Section 58 of the Karnataka Stamp Act, 1957. The Commercial Court failed to consider the admissibility of the document for collateral purpose, misapplied legal principles, disregarded binding precedents under Article 141 of the Constitution of India and passed an order lacking proper reasoning and justification. Hence, plaintiffs pray to set aside the order passed by the Commercial Court. 7. In support of his contentions, he has relied on the following citations:- - 6 • Paul Rubber Industries Private Limited v. Amit Chand Mitra and Ors. reported in AIR 2023 SC 4658, and • Muruganandam v. Muniyandi (Dead) through LRs. reported in 2025 INSC 652. 8. We notice that the defendant had remained ex- parte even before the Commercial Court. The only reason why the Commercial Court had dismissed the suit was that the lease deed relied on by the plaintiffs was an unregistered document which was not appropriately stamped. Even if the lease deed is insufficiently stamped, the contention of the plaintiffs that the defendant had been put in possession of the premises as a lessee would require a consideration and the lease so created would have to be considered as a lease for eleven months from the date of its creation and thereafter from month to month. The question whether the defendant who had been put in possession as a lessee could seek to continue in possession and whether arrears of rent are required to be paid are all factual aspects which require consideration on merits. The dismissal of the suit on the sole ground that the lease deed was an - 7 unregistered document and was insufficiently stamped by itself was not warranted. The Commercial Court on finding that the document was insufficiently stamped ought to have permitted the plaintiffs to cure the defect by paying the requisite value of stamp duty with penalty as required by law. 9. In the above circumstances, we are of the opinion that the suit requires reconsideration on merits. Therefore, the matter is remanded to the Commercial Court to give an opportunity to the plaintiffs to pay the Deficit Stamp Duty, if any. 10. In the result:- (i) The Commercial Appeal is allowed. (ii) The judgment and decree dated 01.10.2024 passed by the Commercial Court in Com.OS.No.1064/2024, is set aside. (iii) The matter is remanded to the Commercial Court for a fresh consideration. (iv) All questions on facts and law are left open. - 8 The interlocutory applications, if any, shall stand disposed of. Sd/- (ANU SIVARAMAN) JUDGE Sd/- (DR. K.MANMADHA RAO) JUDGE cp*