02 March 2020
Supreme Court


Case number: C.A. No.-001893-001893 / 2020
Diary number: 21003 / 2018
Advocates: VINODH KANNA B. Vs





  CIVIL APPEAL NO.   1893   OF 2020    (Arising out of SLP (CIVIL) No.781 of 2019)

The Periyar District Consumer Co­operative  Wholesale Stores Ltd. No. AA467               .…Appellant(s)


B.Balagopal (Died) Through LRs.  & Ors.      ….  Respondent(s)


A.S. Bopanna,J.          

      Leave granted.      

2.   The appellant is before this Court in this appeal

assailing the judgment dated 14.11.2017 passed by the

High Court of Judicature at  Madras in A.S.No.811 of

2009.  Through  the  said judgment the  High  Court  has

dismissed the appeal  filed by the appellant against the

judgment and  decree  dated  18.08.2008  passed  by the

Additional District and Sessions Court (Fast Track Court

                                                                                                                     Page 1 of 14


No.I), Erode in O.S.No.37 of 2007. The respondents

herein were the plaintiffs in the said suit while the

appellant herein was the defendant. For the sake of

convenience and clarity, the parties will be referred to in

the rank assigned to them before the Trial Court below.  

3. The undisputed position in the present case is that

the plaintiff is the owner of the premises in question

wherein the defendant was inducted as the tenant under

the lease agreement  dated  09.07.1980.  The said lease

was for a period of three years and the monthly rental

was fixed at Rs.6,500/­. The advance of Rs.20,000/­ was

paid by the defendant to the plaintiff. Subsequently the

plaintiff filed the civil suit in  O.S.No.95/1990 seeking

eviction of the defendant and vacant possession of the

suit schedule property. The Trial Court through its

judgment and decree dated 08.02.1995 directed the

defendant to vacate and deliver vacant possession of the

premises and the compensation of Rs.15,000/­ was

ordered for the period of three years prior to filing the suit

till date of possession.  

                                                                                                                     Page 2 of 14


4. The  defendant, claiming  to  be  aggrieved filed  an

appeal under Section 96 of the Civil Procedure Code

before the High Court of Madras in Appeal Suit

No.714/1995. In the said appeal it was ultimately agreed

that the defendant would vacate the premises in question

after six  months  and for the said  period the  monthly

compensation of Rs.50,000/­ would be paid to the

plaintiff. The defendant has accordingly vacated the

premises during November 2003. In the earlier

proceedings since liberty was reserved to be plaintiff  to

initiate an appropriate proceeding for damages, the

plaintiffs have initiated the present round of litigation.  

5. In that regard the suit in O.S.No.37/2007 was filed

by the plaintiffs seeking damages at the rate of

Rs.89,000/­ per month. The Trial Court having adverted

to the rival contentions has decreed the suit through its

judgment dated 18.08.2008. The Trial Court has awarded

the monthly compensation of Rs.89,000/­ for the periods

14.07.2000 to 14.07.2003. Thus, in all, the suit was

decreed for a sum of  Rs.26,98,367/­.  Further sum of

                                                                                                                     Page 3 of 14


Rs.3,56,000/­ was ordered towards future loss and cost

of the suit. The defendant claiming to be aggrieved by the

same preferred the appeal before the High Court in

A.S.No.811/2009 which was dismissed through the

judgment dated 14.11.2017. It is in that light the

defendant claiming to be aggrieved is before this Court in

this appeal.  

6. Heard Mr. Jayanth Muth Raj, learned senior

counsel for the petitioner, Mr. K.K. Mani, learned counsel

for the respondents and perused the appeal papers.

7. The factual  position relating to the tenancy, the

earlier round of litigation and the defendant having

thereafter vacated the premises during November 2003,

there is no serious dispute. The only issue for

consideration is with regard to the liability or otherwise of

the defendant to pay the damages as sought by the

plaintiffs and in that regard, whether the claim as put

forth by the plaintiffs and awarded by the Trial Court is

justified. As noted, the lease had commenced on

09.07.1980 and rental fixed at that point of time was in a

                                                                                                                     Page 4 of 14


sum of Rs.6,500/­ per month. At the earlier instance the

suit seeking eviction of the defendant was filed in

O.S.No.95/1990 and the same was decreed directing the

defendant to vacate and pay the compensation at

Rs.15,000/­ per month. The compensation was awarded

for a period of three years.  

8. The  defendant  claiming  to  be  aggrieved filed the

appeal in A.S.No.714/1995. The appeal was disposed of

on 26.02.2003 directing payment of past damages of

Rs.3,47,953/­ at  Rs.15,000/­ per  month on or before

13.03.2003 and the defendant was granted six months’

time to vacate the premises. During the said period of six

months the defendant was directed to pay the damages at

Rs.50,000/­ per month. However, liberty was reserved to

the plaintiffs/landlords to file a separate suit for damages

at a higher rate than Rs.50,000/­ which had been fixed

by the High Court. It is in that light the subsequent suit

O.S.No.37/2007 was filed seeking for damages at the rate

of Rs.89,000/­ per month.  

                                                                                                                     Page 5 of 14


9. In the course of consideration in the suit the Trial

Court  has kept in  view the  provisions as  contained  in

Section 4 of the Tamil Nadu (Lease and Rent) Control Act

which provides for fixation of fair rent and in that light

had arrived at a conclusion that the monthly rent would

work out to the sum of Rs.1,08,929/­. However, since the

plaintiff had limited the claim for damages at Rs.89,000/­

per month, the suit was accordingly decreed. Insofar as

the nature of the consideration made by the Trial Court,

since the area of the premises which had been let out is

not in dispute  and since  the  rental for  such area was

calculated at the rate as prescribed under the Rent

Control Act, the legality of the decision cannot be

assailed. It is in that light the High Court while re­

appreciating the matter in the appeal in A.S.No.811/2009

has referred to the very aspects taken note by the Trial

Court and has accordingly dismissed the appeal.  

10. The learned senior counsel for the appellant while

assailing the decree would contend that though the

factual aspects are not in dispute, the manner in which

                                                                                                                     Page 6 of 14


the enhanced rent by way of damages has been awarded

by the Trial Court is not justified. It is contended that in

the earlier round of litigation, when an application was

filed by the plaintiffs in the eviction proceedings in

A.S.No.714/1995,  an  understanding  had  been reached

and the defendant had accordingly agreed to vacate the

premises in six months and have adhered to such

undertaking and vacated the premises during November

2003. In such event merely because liberty was reserved

in the said proceedings, instituting a suit of the present

nature seeking  higher  damages  would  not  be justified

more so in a circumstance when the High Court in the

earlier instance had fixed a higher rent for the said period

of six months. It is further contended that the defendant

is a Consumer Cooperative Society and would not be in a

position to bear such heavy financial burden. It is

pointed out that the defendant has already paid the sum

of Rs.10 lakhs towards the decretal amount on

27.04.2010 and as such the matter should come to an

                                                                                                                     Page 7 of 14


end at that. He, therefore, seeks that the above appeal be


11. The learned advocate for the plaintiffs would

however seek to sustain the judgment and decree passed

by the Trial Court. He contends that though the plaintiff

was entitled to the damages even for the earlier period,

keeping in view the law of limitation the Trial Court has

decreed the suit only for the period of three years prior to

the date on which the defendant vacated. In such event

the defendant should not raise any further grievance in

the matter. It is contended that in O.S.No.95/1990 the

Trial Court had in fact fixed the compensation at

Rs.15,000/­ per month while directing eviction. The

defendant instead of accepting the same, paying the

damages and vacating the premises had filed the appeal

and remained in possession for the further period. It is

contended that  in the instant case the Trial Court has

kept in  view  the  provision  of law and has  accordingly

arrived at an appropriate conclusion relating to damages

which does not call for interference more particularly

                                                                                                                     Page 8 of 14


when it is restricted to the claim  which is lesser the

admissible damages.  

12. Having taken note of the manner of consideration

made by the Trial Court as also the High Court in the

earlier round of litigation relating to eviction and the

present round of litigation relating to damages, an

appropriate consideration is necessary in the background

of the contentions put forth by the learned senior

advocate for the defendant and the learned advocate for

the plaintiffs and in that light keeping in view the status

of the  parties and their conduct.  As  noticed the  Trial

Court while decreeing the suit through its judgment

dated 18.08.2008 has made reference to the Rent Control

Act, kept in mind the provisions contained therein and

has thereafter arrived at a conclusion. The High Court on

re­appreciating the same has endorsed the view. On that

aspect further consideration would not be necessary.  

13. However, what is to be taken note in the present

facts is that, though the ejectment suit was decreed on

08.02.1995 and the appeal had been immediately filed by

                                                                                                                     Page 9 of 14


the defendant in A.S.No.714/1995, during the pendency

of the appeal, in view of   an application filed by the

plaintiff, an understanding was reached that the

defendant agreed to vacate the premises within six

months. While granting the said period of six months to

vacate, the High Court, for the said period had also fixed

the compensation at the sum of Rs.50,000/­ per month.

It is no doubt true that the High Court had also reserved

the liberty to the plaintiff to seek for a higher amount by

filing a separate suit, if need be. In a normal

circumstance if the tenant had not voluntarily vacated, a

claim  for  such damages would be very much  justified.

Even otherwise since such right had been reserved, the

plaintiff no doubt was entitled to institute the suit.  

14. In the present facts, during the course of

consideration of this appeal what appealed to this Court

is also that the appellant is a District Consumer

Cooperative Wholesale Stores and the premises had been

taken on  rent for its  activity  and  it is  not  a  business

activity in the strict sense of the term but is co­operative

                                                                                                                     Page 10 of 14


activity for the benefit of members who are shareholders.

In the process of eviction when time of six months was

granted to vacate and rent had been fixed at Rs.50,000/­

per month the same was also paid by them without

default. In such circumstance it  was suggested by this

Court that the parties arrive at an amicable settlement so

that either of  them are not entirely prejudiced and the

equities could be balanced.   The learned senior counsel

for the  defendant  was receptive to the  said  suggestion

and had indicated that in addition to the sum of Rs.10

lakhs  paid towards the  decretal  amount,  a reasonable

amount suggested by this Court would be paid and the

matter would be brought to a close. The learned counsel

for the plaintiff however did not put forth any suggestion

for amicable settlement but insisted on payment of the

entire amount under the decree.  

15. In that background having taken into

consideration all materials and the special circumstance

noted above, we are of the opinion that a modification of

the judgment and decree is required to be made in the

                                                                                                                     Page 11 of 14


interest of justice so as to limit the decretal amount to a

reasonable quantum. In that regard reference has already

been made to the fact that the defendant is a Consumer

Co­operative Wholesale Stores and has already vacated

after paying the enhanced amount ordered by the High

Court. If substantial unplanned expenditure is heaped on

them for the  retrospective  period  it  would be put in a

financially precarious position. At the same time for

having used the premises and considering the fact that

the premises was taken in the year 1980 and the

enhancement in such cases will be gradual, the drastic

application of the prevailing rent though not justified in

the present facts and circumstance, the plaintiffs would

be entitled to a reasonable compensation. In such event

when the High Court at first instance in

A.S.No.714/1995 had fixed the damages at Rs.50,000/­

per month for the period of six months after which the

defendant was to vacate, it would be justified if the said

amount of Rs.50,000/­ per  month is made applicable

even to the earlier period of three years which was taken

                                                                                                                     Page 12 of 14


into consideration by the Trial Court. In our opinion such

order will meet the ends of justice.  

16. Therefore, the damages for the periods 14.07.2000

to 14.07.2003 if calculated at the rate of Rs.50,000 per

month would work out to Rs.18 lakhs in all. As noted,

the defendant has paid a sum of Rs.10 lakhs towards the

decretal amount on 27.04.2010. Further for the

overlapping  period  between March  to  July  2003 which

was fixed by the High Court  for vacating, the damages

have already been paid at Rs.50,000/­ per month. If that

be the position, the matter could put at rest by directing

the defendant to pay further sum of Rs.7,50,000/­ to the

plaintiff in full and final settlement of all claims, by

modifying the decree to that extent.  

17. In the result, we pass the following order: ­

(i) Judgment and decree dated 18.08.2008

passed  in Suit  No.37/2007 affirmed by the High

Court in AS No.811/2009 stands modified holding

that the  defendant shall  pay to the  plaintiff the

sum of Rs.17,50,000/­ being the lumpsum

damages for the periods 14.07.2000 to 17.07.2003.

                                                                                                                     Page 13 of 14


(ii) Since the sum of Rs.10 lakhs has been paid

by the defendant to the plaintiffs on 27.04.2010,

the balance of sum of Rs.7,50,000/­ shall be paid

within a period of three months from this date.  

(iii) If the amount of Rs. 7,50,000/­ is not paid

within the time frame of three months, the same

shall carry interest at the rate of 12 per cent per

annum on the expiry of three months till the date

of payment.  

(iv) On payment of the amount ordered herein the

same will stand in full and final quit of all claims

between the parties and all litigations shall come to

an end.  

(v) The appeal is allowed in part. The parties

shall however bear their own costs in this appeal.  

(vi)  All applications stand disposed of.   

………….…………….J. (R. BANUMATHI)

         ………….…………….J.                                               (A.S. BOPANNA)

New Delhi, March 02, 2020

                                                                                                                     Page 14 of 14