Smt. Chandan Devi through her legal heirs vs Gyan Chand Kothari

Jitendra Ray Goyal, J.—The respondent-plaintiff filed an application u/s 151 of the CPC on 1/11/2006 whereby the prayer was made to reject the application of the appellant for interim relief and sought direction for registration of the sale deed in favour of respondent and to deliver the possession of the disputed premises in accordance to the impugned judgment and decree and in alternate demanded Rs. 35,000/- per month for mesne profits as use and occupation charges and further in alternate without prejudice to his right of specific performance demanded the payment of Rs. 16 lacs along with interest @ 24% per annum accrued thereon from the date of the payment i.e. 19/1/1996.

The learned Bench of this Court after hearing both the parties dismissed the stay application preferred by the appellants vide its order dated 10/1/2007. The said order was set aside by Hon''ble the Supreme Court in Civil Appeal No. 5774 of 2007 on 10/12/2007 and directed that appellants shall remain in possession during the pendency of the appeal before the High Court. It was further directed that parties shall appear before the High Court which shall now settle the time schedule for hearing the appeal and payment of mesne profits, if any.

The respondent filed an application on 21/1/2008 u/s 151 of the CPC whereby a prayer has been made for disposal of the application of the respondent in respect of mesne profits and fixing the time schedule of the date for hearing of the appeal.

A reply to this application has also been filed by the appellants denying any right of the respondent for mesne profits.

Heard learned Counsel for the parties and perused the material available on the record.

It was inter alia contended by the Counsel appearing for the respondent that agreement for sale of the disputed property was entered into in between the parties on 19/1/1996 and out of the total amount of Rs. 18 lacs an amount of Rs. 16 lacs was paid to the appellant-defendant through bank draft but lateron the appellant refused to execute the sale deed in favour of the respondent-plaintiff. It was also submitted that trial court decreed the suit for specific performance filed by the respondent-plaintiff but in the garb of stay order the appellants are enjoying the fruits of the disputed property whereas the said property can fetch the rent of Rs. 62,000/- per month which is also evident from the detailed valuation report. Reliance was placed on the judgment delivered in the case of Atma Ram Properties (P) Ltd. Vs. Federal Motors Pvt. Ltd., where, in a case under Rent Control and Eviction Act the Hon''ble Supreme Court observed that while staying the execution of a decree under Order 41 Rule 5 of the CPC terms and conditions can be imposed. It was further held that since the power to grant stay is equitable in nature, an applicant for stay must do equity for seeking equity, hence depending on the facts of a given case, an appellate court while passing an order of stay may put the parties on such terms enforcement whereof would satisfy the demand for justice of the party found successful at the end of the appeal. Reliance was also placed on the judgment delivered in the case of Pabbathi Venkataramaiah Chetty Vs. Pabbathi N. Rathnamaiah Chetty and Others, wherein the Hon''ble Supreme Court while staying the dispossession of the appellant in a final decree of partition, also protected the interest of the respondent by directing the appellant to pay Rs. 25,000/- per month to the respondent.

Learned Counsel appearing for the appellants vehemently opposed the prayer of awarding mesne profits to the respondent-plaintiff and submitted that no such mesne profits can be awarded in the matters of specific performance of the contract since it is not a case of wrongful possession of the disputed property and the plaintiff has not acquired any title of the property till date whereas the matter is yet to be adjudicated by this appellate court since the whole matter is at large before the appellate court as the appeal is continuity of the suit. Reliance was placed on the judgment delivered in the case of Rachakonda Narayana Vs. Ponthala Parvathamma and Another, It was then submitted that the amount of 16 lacs of rupees received by the defendant-appellant was a loan and not as a sale price of house which is evident from this fact that even in the year 1996 the value of the property was more than 70 lacs of rupees. It was further submitted that the respondent made a request to the appellant to get her money back after some days in the year 1996 but she deliberately avoided and did not respond, therefore, the appellant deposited the amount in fixed deposit which is still lying in the fixed deposit along with its accrued interest and now the total amount including the interest is about 39 lacs of rupees which the appellants are prepared to pay to the respondent. During the course of arguments, it was further submitted that to resolve this dispute at this stage the appellants are prepared to pay/deposit 45 lacs of rupees as full and final settlement to the respondent or deposit in the court subject to decision of this appeal.

I have considered the rival submissions made at the bar. The present appeal is against the judgment and decree of specific performance of the contract in regard to the disputed property. There is no conflict with this settled legal proposition that appeal is a continuation of the suit, therefore when an appellate court hears an appeal, the whole matter is at large as has also been held in Rachakonda Narayana''s case (supra).

Before examining the present case for awarding mesne profits, it would be appropriate to have a look upon the definition of "mesne profits" provided u/s 2(12) of the CPC which reads as under:

(12) "mesne profits" of property means those profits which the person in wrongful possession of such property actually received or might with ordinary diligence have received therefrom, together with interest on such profits, but shall not include profits due to improvements made by the person in wrongful possession;

Here in the case in hand, it is not the case of the respondent-plaintiff that he is the owner of the disputed house but he is claiming mesne profits on the basis of impugned decree of specific performance of the contract which is under challenge in this appeal. In my view upon a decree for specific performance being passed on an agreement, no title passes until conveyance is actually executed by the defendant in obedience or by the court in execution of the decree. Until therefore title actually passes to the plaintiff the defendant will continue to be owner of the property with the result that he cannot be said to be in unlawful possession and therefore, he cannot be said to be liable for the mesne profits. In this factual scenario it would not be appropriate to award mesne profits at this stage, however, the alternate prayer of the respondent-plaintiff appears to be reasonable whereby he prayed for depositing the original amount of Rs.16 lacs along with interest. The appellants have also desired to deposit the original amount along with actual accrued interest thereon and during the course of arguments the Counsel appearing for the appellants has also offered to deposit Rs. 45 lacs in the court.

Keeping in view the entire facts and circumstances and also to safeguard the interest of respondent-plaintiff, it would be appropriate to direct the appellants to deposit Rs. 45 lacs (forty five lacs) in the court.

Accordingly, this application is partly allowed and the appellants are directed to deposit Rs. 45 lacs (forty five lacs) in the court within a period of one month from today which shall be deposited in the fixed deposit initially for a period of two years which may be extended from time to time as per the directions of this Court. Such deposited money along with accrued interest thereon shall be subject to decision of this appeal.

This appeal pertains to the year 2006 and a number of old appeals are pending before this Court, however, keeping in view the directions of Hon''ble the Apex Court, this appeal is ordered to be listed for final disposal in the month of July, 2009.