MAHENDRA KAUR ARORAversusHDFC BANK LTD

           [2024] 6 S.C.R. 280 : 2024 INSC 432

                    Mahendra Kaur Arora
                            v.
                      HDFC Bank Ltd
            (Civil Appeals No. 6096-6097 of 2017)
                           08 May 2024
    [Hima Kohli and Ahsanuddin Amanullah, JJ.]

                     Issue for Consideration
In a petition u/Article 227 of the Constitution of India, Single Judge
upheld the order passed by Appellate Rent Tribunal by which the
decree passed in favour of the appellant-landlady by the Rent
Tribunal was set aside and counter claim filed by the respondent-
Bank seeking refund of the security amount was allowed. Appellant
filed intra court appeal which was dismissed by the Division Bench
of the High Court as not maintainable.

                            Headnotes
Lease Agreement – Respondent-Bank terminated the lease
agreement by issuing three months’ notice in terms of
clause 6 thereof – However, did not hand over the vacant
possession of the premises to the appellant-landlady and
continued occupying it – As per the appellant, the respondent
also did not pay the use and occupation charges in respect
of the subject premises, after adjusting the security deposit
towards the rent payable for three months – Application
filed by appellant seeking eviction and recovery of arrears
of rent was decreed by Rent Tribunal, counter claim filed by
the respondent was rejected – Appeal filed by respondent,
allowed by Appellate Rent Tribunal – Appellant filed petition
u/Article 227 of the Constitution of India before the High
Court, dismissed by Single Judge – Appellant filed intra court
appeal, dismissed by Division Bench of the High Court as
not maintainable:
Held: Language of Clause 6 of the Agreement made it abundantly
clear that the respondent-Bank was liable to refund of the deposit
amount contemporaneous to removing itself from the leased
premises and handing over vacant possession thereof to the
appellant and giving charge thereof to her, which procedure
was not followed – Impugned order passed by Single Judge not
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                    Mahendra Kaur Arora v. HDFC Bank Ltd


     sustainable – However, order passed by the Division Bench of
     the High Court is maintained for the reason that no intra-court
     appeal could have been preferred by the appellant against an
     order passed by the Single Judge on a petition filed u/Article
     227, Constitution of India – Judgment passed by Rent Tribunal
     restored and the decree passed in favour of the appellant upheld.
     [Paras 10, 11]
     Constitution of India – Article 227 – Order passed in
     proceedings u/Article 227, maintainability of intra-court
     appeal:
     Held: No intra-court appeal can be preferred against an order
     passed by Single Judge on a petition filed u/Article 227 of the
     Constitution of India. [Para 11]

                                 List of Acts
     Constitution of India.

                              List of Keywords
     Lease Agreement; Rent Tribunal; Appellate Rent Tribunal; Non-
     payment of rent; Eviction; Recovery of arrears of rent; Use and
     occupation charges; Termination of lease agreement; Vacant
     possession not handed over; Security deposit; Refund of deposit
     amount; Counter claim; Intra court appeal.

                              Case Arising From

     CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 6096-6097 of
     2017
     From the Judgment and Order dated 30.07.2015 in DBCSA No. 332
     of 2012 and 09.01.2012 in SBCWP No. 8464 of 2009 of the High
     Court of Judicature for Rajasthan at Jaipur

                          Appearances for Parties

     Ms. Sobha Gupta, Sr. Adv., Rishi Matoliya, Nikhil Kumar Singh,
     Raghuveer Pujari, Ms. Sumati Sharma, Advs. for the Appellant.
     Sandeep P. Agarwal, Sr. Adv., Varun Phogat, Viresh B. Saharya,
     Himanshu Dagar, Nitin Sejwal, Saujanya, Ms. Tanya Chanda, Akshat
     Agarwal, Advs. for the Respondent.
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                       Judgment / Order of the Supreme Court
                                                    Order
1.     The appellant-landlady is aggrieved by the judgment dated 30th July,
       2015 passed by the Division Bench1 as also the order dated 09th
       January, 2012 passed by the learned Single Judge in a writ petition2
       filed before the High Court of Judicature for Rajasthan at Jaipur
       Bench, preferred by her under Article 227 of the Constitution of India.
2.     The facts of the case reveal that the appellant-owner of a commercial
       premises at Vashistha Marg, Raja Park, Jaipur had leased out a part
       of the said premises3 to the respondent-Bank for a period of nine
       years in terms of the lease agreement dated 13th October, 2000,
       executed between the parties. The relevant clauses of the said lease
       agreement are reproduced hereinbelow :
              “LESSEE’S COVENANTS:
              2 (j) On the expiry of the said period of the lease or any
              renewal thereof, the Lessee shall deliver the demised
              premises in such order and condition as in consistent with
              the terms, covenants and conditions on the part of the
              Lessee herein contained (save and except damage to the
              demised premises by the fire unless the fire has occurred
              due to negligence of the Lessee), riots, earthquake, storm,
              war, civil commotion, acts of God and other conditions
              over which the Lessee shall have no control) SUBJECT
              ALWAYS to what is stated hereinafter.
              ASSIGNMENT/TERMINATION/RENEWAL
              6 (a) The Lessee shall be entitle to assign or sub-let
              or otherwise allow use and occupation of the demised
              premises or any part thereof to its business associates,
              affiliate companies but not beyond the tenure of this lease
              or renewal thereof (if any) , as mentioned hereunder.
              (b) Notwithstanding anything contained herein, the Lessee
              shall always be entitled, without assigning any reason, to


1    D.B. Civil Spl. Appeal (Writ) No.332 of 2012
2    S.B. Civil Writ Petition No.8464 of 2009
3    Shop No.485 and basement
[2024] 6 S.C.R.                                                             283

                    Mahendra Kaur Arora v. HDFC Bank Ltd


           terminate this lease at any time before the expiry of the
           tenure of this lease or any renewal period (if any) thereof,
           by giving to the Lessor three months’ prior notice in writing.”
3.   In terms of the lease agreement, the agreed monthly rent of the
     premises was fixed at ₹28,625/- (Rupees Twenty eight thousand
     six hundred twenty five only). Vide letter dated 10th May, 2004, the
     respondent-Bank terminated the lease agreement by issuing a three
     months’ notice in terms of clause 6 thereof. The said notice period
     was made effective from 16th August, 2004.
4.   It is the version of the appellant-landlady that the respondent-Bank
     did not hand over the vacant and peaceful possession of the leased
     premises to her and instead, continued occupying the subject
     premises upto 18th June, 2006, when the keys were finally handed
     over to her. It is also the stand of the appellant-landlady that the
     respondent-Bank did not pay her the use and occupation charges
     in respect of the subject premises from 16th August, 2004 till 20th
     February, 2006, after adjusting the security deposit of ₹85,875/-
     (Rupees Eighty five thousand eight hundred seventy five only)
     towards the rent payable for three months.
5.   Aggrieved by the non-payment of rent by the respondent-Bank, the
     appellant filed an application before the Rent Tribunal, Jaipur City,
     Jaipur on 20th February, 2006 seeking eviction and recovery of the
     arrears of rent. It was after institution of the aforesaid petition by the
     appellant-landlady that the respondent-Bank handed over the keys of
     the premises to her before the Presiding Officer of the Rent Control
     Tribunal on 18th June, 2006. The petition filed by the appellant-
     landlady was contested to the hilt by the respondent-Bank who also
     filed a counter claim seeking refund of the security amount along with
     interest @ 24% per annum compounded quarterly, w.e.f. 17th August,
     2004, till realization. Vide judgment dated 10th April, 2008, the rent
     application filed by the appellant-landlady was decreed in her favour
     and the counter claim filed by the respondent-Bank was rejected.
6.   Aggrieved by the aforesaid decision, the respondent-Bank filed an
     appeal before the Appellate Rent Tribunal which was allowed vide
     order dated 05th March, 2009. As a consequence thereof, the decree
     passed in favour of the appellant-landlady was set aside and the
     counter claim filed by the respondent-Bank was allowed. The said
     order was challenged by the appellant-landlady by filing a petition
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       under Article 227 of the Constitution of India before the High Court
       which was dismissed by the learned Single Judge vide order dated
       09th January, 2012. Instead of approaching this Court for relief against
       the said order, the appellant filed a misconceived intra court appeal
       that has been dismissed by the Division Bench of the High Court as
       not maintainable vide order dated 30th July, 2015. Both the orders
       are under appeal before us.
7.     Ms. Shobha Gupta, learned Senior counsel appearing for the
       appellant-landlady submits that the learned Single Judge has erred in
       upholding the order passed by the Appellate Rent Tribunal whereby
       the decree passed in favour of the appellant-landlady was set aside
       inasmuch as the Court failed to appreciate the fact that the notice
       dated 10th May, 2004 issued by the respondent-Bank referred to its
       proposal to handover possession of the subject premises on 16th
       August, 2004. It is urged that the security deposit could have been
       refunded to the respondent-Bank contemporaneous to handing over
       vacant and peaceful possession of the premises to the appellant-
       landlord, which in the instant case was not done. It is therefore,
       submitted that the obligation cast on the appellant-landlady to refund
       the security amount in terms of the lease agreement did not arise till
       the respondent-Bank actually vacated the subject premises which
       admittedly remain in its possession till 18th June, 2006.
8.     Per contra, Mr. Sandeep P. Agarwal, learned Senior counsel appearing
       for the respondent-Bank seeks to rely on the terms and conditions
       of the lease agreement and, in particular clauses of the Deposit
       Agreement dated 13th October, 2000. Clauses 6 and 8 of the Deposit
       Agreement read as follows :
            “6. It is agreed by and between the parties hereto that on
            the said Lease Agreement of any renewal thereof expiring
            by efflux of time or coming to an end for any reason
            whatsoever as provided in the said Lease Agreement
            the Lessor shall refund (without any deduction on any
            account and without interest) the said deposit to the
            Lessee simultaneously with the Lessee removing itself/ its
            officers / employees using the leased premises from and
            vacating the leased premises and giving charge thereof
            to the Lessor (reasonable wear and tear, damages/ Loss
            to / destruction of the leased premises by fire not caused
[2024] 6 S.C.R.                                                             285

                    Mahendra Kaur Arora v. HDFC Bank Ltd


           by the willful neglect on the part of the Lessee, its officers
           /employees using the leased premises, Civil commotion,
           riots, air attack, act of God and anything else beyond the
           control of the Lessee excepted).”
           8. In the event the Lessor does not refund the said
           deposit to the Lessee in full, at the time of the said Lease
           Agreement or any renewal thereof comes to an end, as
           aforesaid, then the consequences mentioned in para nos.
           i) to iii) hereunder shall follow:
           i)     The Lessee shall (without prejudice to its rights
                  and remedies in law) , not be obliged or bound to
                  vacate and give charge of the leased premises to
                  the Lessor and the Lessee shall be entitled to use
                  or permit, the leased premises to be used by any
                  person of its choice without being liable to pay any
                  rent, outgoings or damages to the Lessor until such
                  time as the Lessor does not refund to the Lessee
                  the said deposit in full ; and
           ii)    In addition, the Lessor shall be liable to pay to the
                  Lessee interest @ 24% p. a. compounded quarterly,
                  on the said deposit from the date of termination or
                  expiry of the said Lessee Agreement or any renewal
                  thereof till the date of refund of the said deposit by
                  the Lessor to the Lessee; and
           iii)   In the event the Lessor is unable to return the deposit
                  as aforesaid for a period of 30 days from the date it
                  becomes due, the Lessee shall be liberty to further
                  sub- let the leased premises for period of not less than
                  12 months at a time on such terms and conditions
                  as the Lessee may in its absolute discretion may
                  deem fit”
9.   It is the stand of the respondent-Bank that in terms of the aforesaid
     clauses of the Deposit Agreement, the appellant-landlady was under
     an obligation to refund the security deposit to the respondent-Bank
     at the time of handing over vacant and peaceful possession of the
     leased premises, which she failed to do and therefore, the aforesaid
     clauses entitle the respondent-Bank to continue using the leased
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       premises itself or by any other person of its choice without any
       liability to pay any rent/outgoings/damages.
10. We are afraid, the aforesaid argument advanced by learned counsel for
    the respondent-Bank is not persuasive. The language of Clause 6 of
    the Deposit Agreement makes it abundantly clear that the respondent-
    Bank was liable to refund the deposit amount contemporaneous
    to the Bank removing itself from the leased premises and handing
    over vacant possession thereof to the appellant-landlady and giving
    charge thereof to her, which procedure in the instant case, had not
    been followed. There is nothing on record to demonstrate that any
    steps were taken by the respondent-Bank calling upon the appellant-
    landlady to remain present at the subject premises for purposes of
    handing over/taking over possession of the leased premises on a
    particular date and time and giving charge thereof to her for her to
    refund the security deposit simultaneously to the respondent-Bank.
11. For the aforesaid reasons, we are unable to sustain the impugned
    order dated 09th January, 2012 passed by the learned Single Judge
    that has upheld the order dated 05th March, 2009, passed by the
    Appellate Rent Tribunal, Jaipur. However, the order dated 30th July,
    2015 passed by the Division Bench of the High Court is maintained
    for the reason that no intra-court appeal could have been preferred
    by the appellant-Landlady against an order passed by the learned
    Single Judge on a petition filed under Article 227 of the Constitution
    of India. As a result, Civil Appeal No. 6096 of 2017 is allowed, the
    judgment dated 10th April, 2008 passed by the Rent Tribunal is
    restored and the decree passed in favour of the appellant-landlady
    is upheld. Civil Appeal No. 6097 of 2017 is however dismissed as
    there is no error in the finding returned by the Division Bench of the
    High Court regarding maintainability of an appeal against the order
    dated 09th January, 2012, passed in proceedings under Article 227 of
    the Constitution of India. Parties are left to bear their own expenses.


       Headnotes prepared by: Divya Pandey                    Result of the case:
                                           Civil Appeal No. 6096 of 2017 allowed;
                                         Civil Appeal No. 6097 of 2017 dismissed.