Defence Cannot Be Struck Off Without Proving Wilful Rent Default

Source: Supreme Court 

Why in News? 

A Division Bench of the Supreme Court of India, comprising Justice S.V.N. Bhatti and Justice Prasanna B. Varale, in Dharmendra Kalra & Ors. v. Kulvinder Singh Bhatia (2026), held that it is impermissible to strike off a tenant's defence at the threshold under Order XV Rule 5 of the Code of Civil Procedure, 1908 (CPC), without first determining the "first date of hearing," ensuring proper service of summons on the tenant, and examining whether the default in rent deposit was wilful or bona fide. 

• The Court set aside the orders of both the Trial Court and the High Court, and remitted the matter for fresh consideration, holding that striking off the defence is a serious matter and ought not to be resorted to unless there is a clear case of deliberate default or contumacious conduct on the part of the tenant. 

What was the Background of Dharmendra Kalra & Ors. v. Kulvinder Singh Bhatia (2026) Case? 

• The dispute arose from a tenancy concerning two halls where the respondent-tenant was operating "Gyan Vaisnav Hotel."  
• The landlords contended that the monthly rent had been revised to Rs. 25,000 in September 2020, and that the tenant had defaulted in payment from November 2020 onwards. 
• After issuing a notice terminating the tenancy under Section 106 of the Transfer of Property Act, the landlords instituted a suit before the Small Causes Court seeking eviction and recovery of rent arrears. 
• During the pendency of the proceedings, the landlords moved an application under Order XV Rule 5 CPC seeking striking off of the tenant's defence on the ground of non-deposit of rent.  
• The Trial Court allowed the application on August 5, 2023 and struck off the defence. 
• The tenant challenged this order before the High Court, which partly allowed the revision petition and directed the tenant to deposit rent at the rate of Rs. 1,500 per month instead of Rs. 25,000, warning that failure to deposit would result in striking off the defence. Subsequently, despite the tenant's default, the High Court granted a further extension of time on the ground that the local counsel had gone abroad. 
• Aggrieved, the landlords approached the Supreme Court. 

What were the Court's Observations? 

• On the Nature of Power Under Order XV Rule 5 CPC: The Court held that the power to strike off the defence under Order XV Rule 5 CPC, though couched in mandatory terms, is not to be exercised mechanically. The court must consider whether there has been substantial compliance and whether the default is wilful or contumacious. Striking off the defence is a serious matter and ought not to be resorted to unless there is a clear case of deliberate default or contumacious conduct on the part of the tenant. 
• On the "First Date of Hearing": The Court held that the "first date of hearing" — defined as the date on which the court proposes to apply its mind to the controversy in the suit — must first be determined before invoking Order XV Rule 5 CPC. It clarified that an application for striking off the defence cannot be considered on any date fixed for procedural compliance alone. In the absence of a clear determination of such a date, the very foundation for invoking Order XV Rule 5 CPC becomes uncertain. 
• On the Trial Court's Error: The Court found that the Trial Court had erred in allowing the application under Order XV Rule 5 CPC at the threshold, without determining the first date of hearing and without examining whether the tenant's default was bona fide or wilful. Foundational aspects, including proper service of notice and opportunity of hearing, had neither been conclusively determined nor adequately examined. 
• On the High Court's Approach: The Court found fault with the High Court's approach as well, holding that while it had initially passed a conditional order directing deposit within a stipulated period, it later granted an extension of time without adequately reconciling the earlier conditional direction with the subsequent indulgence shown to the tenant. 

What is Order XV Rule 5 of the Code of Civil Procedure, 1908? 

Order XV Rule 5 CPC — Striking Off Defence for Failure to Deposit Admitted Rent: 

Sub-rule (1) — Core Obligation on Defendant-Tenant: 

• In a suit by a lessor for eviction after determination of lease and recovery of rent/compensation for use and occupation, the defendant must, at or before the first hearing, deposit the entire amount admitted by him to be due, along with interest at 9% per annum. 
• Whether or not any amount is admitted to be due, the defendant must throughout the continuation of the suit deposit the monthly amount due within one week from the date of its accrual. 
• In default of either deposit, the court may strike off the defendant's defence (subject to Sub-rule 2). 

Explanation 1 — "First Hearing": 

• Means the date for filing the written statement or for hearing as mentioned in the summons. 
• Where more than one such date is mentioned, it refers to the last of those dates. 

Explanation 2 — "Entire Amount Admitted by Him to Be Due": 

• Means the entire gross amount (rent or compensation for use and occupation) calculated at the admitted rate of rent for the admitted period of arrears. 
• Only permissible deductions are: taxes paid to a local authority on the lessor's account; amounts paid to the lessor and acknowledged by the lessor in writing; and amounts deposited in court under Section 30 of the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972. 
• No other deduction is permitted. 

Explanation 3 — "Monthly Amount Due": 

• Means the amount due every month (as rent or compensation for use and occupation) at the admitted rate of rent. 
• Only permissible deduction is taxes, if any, paid to a local authority in respect of the building on the lessor's account. 

Sub-rule (2) — Opportunity Before Striking Off Defence: 

• Before passing an order striking off the defence, the court may consider any representation made by the defendant. 
• Such representation must be made within 10 days of the first hearing or within 10 days of the expiry of the one-week period for monthly deposit, as the case may be. 

Sub-rule (3) — Withdrawal of Deposited Amount by Plaintiff: 

• The amount deposited under this rule may be withdrawn by the plaintiff at any time. 
• Such withdrawal does not prejudice any claim by the plaintiff disputing the correctness of the amount deposited. 
• If the deposited amount includes sums claimed by the depositor to be deductible, the court may require the plaintiff to furnish security for such sums before allowing withdrawal.