Court Dismisses Appeal, Confirms Enhanced Mesne Profits for Unauthorised Occupation Post-Tenancy Termination
In a significant judgment delivered on September 28, 2026, the Delhi High Court dismissed an appeal filed by Siddhanth Mendiratta against a trial court's decision that decreed recovery of possession, arrears of rent, and mesne profits in favor of Madhu Chawla and another respondent. The court upheld the trial court's findings, which were based on a Rent Agreement dated August 22, 2018, despite the appellant's denial of its execution.
The case involved a dispute over a shop in New Delhi, which Mendiratta had been occupying since 2014. The primary contention was the rental terms and the alleged payment of a mortgage amount, which the appellant claimed had reduced his rental liability. The trial court, however, found no evidence to support this claim and held that the appellant was liable for arrears of rent at the rate of Rs. 25,500 per month, as per the initial agreement, until the tenancy's termination via a legal notice dated September 7, 2019.
Justice Neena Bansal Krishna, presiding over the appeal, confirmed the trial court's reliance on admissions made by the appellant during cross-examination, which corroborated the respondents' claims of a valid tenancy agreement. Despite the appellant's assertion that the rent was Rs. 2,900 due to a mortgage agreement, the court found that he failed to substantiate this claim with credible evidence.
The High Court also addressed the issue of mesne profits, affirming the trial court's decision to enhance the profits by 15% every three years for unauthorized occupation after tenancy termination. The court held that such an enhancement was reasonable in the absence of evidence to the contrary regarding local rent trends, thereby setting a precedent for similar cases.
The appellant's challenge to the validity of the Rent Agreement based on its notarization and registration status was dismissed. The court ruled that the notarization by a notary public did not alone prove execution but relied on evidence and admissions during the trial to establish its genuineness.
The judgment also discussed the principles of assessing mesne profits, emphasizing the court's ability to take judicial notice of rent escalations in urban areas, thus validating the trial court's approach.
Ultimately, the Delhi High Court's decision underscores the importance of credible evidence in tenancy disputes and clarifies the legal standards for proving rental agreements and assessing mesne profits.
Bottom Line :
Tenant's failure to prove payment of alleged mortgage amount and denial of unregistered Rent Agreement does not absolve liability for arrears of rent and mesne profits. Mesne profits can be enhanced by 15% every three years for unauthorised occupation post-termination of tenancy.
Statutory provision(s): Code of Civil Procedure, 1908 (Sections 96 and Order XLI), Transfer of Property Act, 1882 (Section 106), Indian Evidence Act, 1872 (Sections 67 and 114), Code of Civil Procedure (Section 2(12)).
Siddhanth Mendiratta v. Madhu Chawla, (Delhi) : Law Finder Doc id # 2987620
