Bombay HC orders tenant to pay Rs.5 lakh pm as compensation

MUMBAI: In a 41-year-old legal dispute between a landlord and a tenant over a Peddar Road flat, the Bombay high court in an interim order has directed the tenant to pay Rs 5 lakh monthly compensation if they want to continue occupying the house while the court hears the appeal against the eviction order.

“The suit property is situated in a posh locality known as Peddar Road with all civic amenities available within approachable distance which is covered by buses and taxis insofar as surface transportation is concerned. The suit property is situated in a prestigious and aristocratic locality of Mumbai,” said Justice R D Dhanuka,, referring to the valuation report of the property on the ground floor of a two-storey bungalow, Hari Kunj, on Peddar Road. The area is spread over 4,593 square feet and includes living area, garage, servant quarters and open courtyard. The HC considered that the sub tenant, who was brought in by the original tenant in 1973, also has access to an open lawn and garden measuring 4,505 square feet. While the sub tenant valued the property at Rs 80 per square feet per month, the landlord referred to leave and licence agreements of two other properties in the locality that was around Rs 172 per square feet per month.

The HC said while the compensation fixed by the court should not be “punitive or unreasonable”, it should keep in mind the principles set by various Supreme Court judgments on the issue. “If the vacant premises would have been made available with the landlord upon decree of eviction, he would have fetched the present market rent by letting out the suit property to the third parties. The landlord is thus entitled to be compensated in view of the tenant having been allowed to occupy the suit premises though there was a decree of eviction against him,” said the HC.

The HC last year, while granting interim protection to the sub tenant from eviction, directed an adhoc payment of Rs 1 lakh per month. The matter recently came up for confirmation and the HC, after considering the report of the valuers presented by the landlord and subtenant, fixed the interim monthly compensation at Rs 5 lakh. The court allowed the landlord to withdraw the amount after he submitted a bank guarantee and also said if the sub tenant defaults on the payment, the interim protection from eviction would automatically expire.

Credits ET Realty

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