National Seeds Corporation LTD vs. M/S Cost TO Cost Computers And Lingo Impex & Anr

Held

The High Court set aside the impugned order of the Trial Court and substituted it with directions under Order XV-A of the CPC. The Court directed the defendants to deposit the total arrears of rent from April 2020 to February 2022, calculated at ₹6,82,731/- per month (after adjusting a prior payment), amounting to ₹1,54,34,806.81/-. This amount was to be deposited in eight monthly installments by the 15th of each month, commencing March 15, 2022, with the first seven installments being ₹20 lakhs each. Additionally, the defendants were directed to pay user charges of ₹6,82,731/- per month from March 2022 onwards, payable by the 15th of each month. The Court stipulated that in case of default in any installment or payment, the consequences under Order XV-A of the CPC would follow. The Court clarified that these payments were without prejudice to the rights and contentions of the parties in the suit and that the merits of the case were for the Trial Court to resolve. The plaintiff was to provide a GST invoice for monthly payments.

Facts

The petitioner, National Seeds Corporation Ltd., filed a commercial suit seeking recovery of possession of leased property, arrears of rent, and mesne profits. The suit was based on an unregistered lease deed. The petitioner contended that the lease tenure had ended and the respondent-defendants had failed to pay rent since April 2020. The defendants disputed the extent of property in their possession, the applicability of force majeure, and the suit's maintainability. However, they did not dispute paying ₹6,82,731/- per month as rent. The petitioner sought an order under Order XV-A of the CPC for interim rent payments. The Trial Court rejected this application. The petitioner then filed a petition under Article 227 of the Constitution before the High Court.

Key Issues

1. Whether the Trial Court erred in rejecting the petitioner's application for an order under Order XV-A of the Code of Civil Procedure, 1908, for interim rent payments, considering the admitted monthly rent payment by the respondents. Petitioner's Contention: The petitioner argued that the Trial Court's rejection of the application under Order XV-A was erroneous, especially given the undisputed fact that the respondents were paying a substantial monthly rent. They sought directions for payment of arrears and future rent as per the lease agreement, including enhanced rent. The petitioner relied on the provisions of Order XV-A of the CPC, which allows for interim rent payments in suits for recovery of immovable property. Respondents' Contention: The respondents, while not disputing the monthly rent payment, contended that the amount paid was in excess of the rent due. They sought to fix the rent at the last paid rate and requested the Court to direct payment of arrears in installments. They also raised issues regarding the extent of the property in their possession, the applicability of the force majeure clause, and the maintainability of the suit under the Commercial Courts Act, 2015.