Source: Supreme Court  

Why in News? 

Recently, the bench of Justices Sanjay Karol and Manoj Misra upheld the Bombay High Court’s decision in the landlord-tenant dispute, modifying only the interest rate from 8% to 6%, and directed the tenant to pay the dues within 3 months, while calling upon the Chief Justice of the Bombay High Court to address delays in similar pending cases. 

• The Supreme Court held this in the matter of Mohit Suresh Harchandrai V. Hindustan Organic Chemicals Limited (2025). 

What was the Background of Mohit Suresh Harchandrai V. Hindustan Organic Chemicals Limited (2025) Case? 

• Hindustan Organic Chemicals Limited (HOCL), a public sector undertaking, initially leased premises at 'Harchandrai House', 81/A Maharshi Karve Road, Mumbai, comprising ground floor and second floor totalling 7,825 square feet built-up area. 
• The original lease agreement was executed for three years from 1st April 1962 to 31st March 1966, with monthly rent of Rs. 10,955 and administrative charges of Rs. 55,557 per month. 
• Upon expiry of the lease in March 1966, HOCL continued occupying the premises as a monthly tenant without executing a fresh lease agreement. 
• This landlord-tenant relationship persisted uninterrupted for 34 years until the landlords served a termination notice on 25th April 2000. 
• HOCL lost its statutory protection under rent control laws due to provisions of Section 3(1)(b) of the Maharashtra Rent Control Act, 1999, which removed special protection for public sector undertakings. 
• Following the termination notice, landlords Mohit Suresh Harchandrai and others filed an eviction suit on 2nd September 2000 before the Small Causes Court, Mumbai (T.E & R Suit No. 122/152 of 2000). 
• The Small Causes Court decreed eviction in April 2009, directing HOCL to vacate within three months and pay mesne profits from 1st June 2000 until possession restoration. 
• HOCL's appeal against the eviction order was dismissed in August 2012, and their subsequent revision petition was rejected by the High Court in May 2013. 
• HOCL finally vacated the premises and handed over possession to the landlords on 23rd April 2014, ending over five decades of occupation. 
• The primary dispute centred on determining the appropriate per square foot rate for calculating mesne profits during the period of unauthorised occupation from June 2000 to April 2014. 

What were the Court’s Observations? 

• The Supreme Court expressed deep concern that the landlord-tenant dispute had remained in judicial forums for over two-and-a-half decades, with landlords receiving monetary benefits only after a quarter-century had passed since initiating termination proceedings in 2000. 
• The Court observed that in landlord-tenant disputes, there exists a dual dimension of deprivation - landlords suffer from loss of property enjoyment and monetary benefits, while tenants face the burden of paying substantial accumulated amounts within short timeframes when matters are finally decreed. 
• The Court emphasised that being a government entity or public sector undertaking does not entitle a tenant to any special consideration or extra treatment, and such entities stand on equal footing with private tenants in legal proceedings. 
• The Court noted that while litigation delays are sometimes attributable to the parties themselves, judicial forums also bear responsibility for prolonged dispute resolution, and courts of law and justice are duty-bound to ensure no party suffers due to systemic delays. 
• The Court acknowledged that delayed adjudication in such disputes creates a lose-lose situation where both landlords and tenants bear the brunt - landlords through deprivation of property rights and monetary dues, and tenants through accumulated financial obligations. 
• The Court directed the Chief Justice of Bombay High Court to investigate pendency periods in landlord-tenant disputes across concerned courts and issue appropriate directions for expeditious disposal if similar instances of inordinate delay are identified. 

What are the Legal Provisions Referred? 

Order XX Rule 12 of the Code of Civil Procedure, 1908 - Decree for Possession and Mesne Profits 

• Sub-rule (1) empowers courts in suits for recovery of possession of immovable property and rent or mesne profits to pass comprehensive decrees covering multiple aspects of the dispute. 
• Clause (a) permits courts to decree possession of the property itself, establishing the primary relief sought in eviction proceedings. 
• Clause (b) enables courts to decree payment of rents accrued prior to suit institution or direct enquiry into such rents, covering pre-litigation monetary claims. 
• Clause (ba) specifically addresses mesne profits by allowing courts to either decree fixed amounts or direct enquiry proceedings to determine compensation for unauthorised occupation. 
• Clause (c) provides for ongoing enquiry into rent or mesne profits from suit institution until one of three specified events occurs - delivery of possession to decree-holder, relinquishment by judgment-debtor with court notice, or expiration of three years from decree date. 
• Sub-rule (2) mandates that where enquiry is directed under clauses (b) or (c), a final decree regarding rent or mesne profits must be passed based on enquiry results, ensuring comprehensive resolution of monetary claims. 

Article 227 of the Constitution of India - Power of Superintendence over Courts by High Court 

• Clause (1) vests every High Court with superintendence authority over all courts and tribunals within its territorial jurisdiction, establishing hierarchical judicial oversight. 
• Clause (2)(a) empowers High Courts to call for returns from subordinate courts, enabling monitoring of judicial administration and case management. 
• Clause (2)(b) grants High Courts authority to make general rules and prescribe forms for regulating practice and proceedings in subordinate courts, ensuring uniformity in judicial processes. 
• Clause (2)(c) permits High Courts to prescribe formats for maintaining books, entries and accounts by court officers, standardising administrative procedures. 
• Clause (3) allows High Courts to settle fee tables for sheriffs, clerks, officers, attorneys, advocates and pleaders, subject to consistency with existing laws and Governor's approval. 
• Clause (4) specifically excludes Armed Forces courts and tribunals from High Court superintendence, recognising military justice system's autonomous character. 

Case Law Precedents: 

• Bijay Kumar Manish Kumar (HUF) v. Ashwin Bhanulal Desai, (2024) This Supreme Court decision was extensively relied upon for principles governing payment of mesne profits in landlord-tenant disputes. 
• Achal Misra v. Rama Shanker Singh, (2005) This precedent established that tenants are liable to pay rent equivalent to mesne profits from the date they cease to be entitled to retain possession, and such entitlement cannot be pegged to standard rent. 
• Achal Misra (2) v. Rama Shanker Singh, (2006) - This subsequent decision reiterated the legal position regarding mesne profits liability for unauthorised occupation. 
• Atma Ram Properties (P) Ltd. v. Federal Motors (P) Ltd., (2005)  This case was referenced to support the principle that landlords' entitlement to mesne profits is not restricted to standard rent rates when tenants have ceased to have legal right to possession.