Court’s Decision
The Bombay High Court allowed the interim application filed by tenants seeking to stay proceedings in a mesne profits petition. The Court held that once the execution, effect, and operation of a decree for possession had been stayed in its entirety by the High Court, all proceedings under the decree—including determination of mesne profits—stood stayed.
The Court observed:
“Where the decree as a whole is stayed, it may not be permissible to restrict the scope of the stay order only to the delivery of possession of the property.”
Accordingly, the Court stayed the mesne profits petition and execution proceedings until final disposal of the pending civil revision.
Facts
The dispute arose from a tenancy in respect of premises at Vile Parle, Mumbai. The landlord had instituted an eviction suit before the Court of Small Causes in 2008. The trial court dismissed the suit in 2016, but on appeal in 2021, the Appellate Bench partly allowed the landlord’s appeal and directed the tenants to hand over possession.
The tenants filed a civil revision in the High Court, which in July 2023 granted ad-interim relief staying the effect, operation, and implementation of the decree. The Court also directed the tenants to deposit interim compensation of ₹5.5 lakhs per month.
Despite this, the landlord filed a mesne profits petition before the Small Causes Court. The tenants sought a stay of those proceedings, arguing that since the decree was stayed in its entirety, the mesne profits proceedings could not continue. The Small Causes Court rejected this request, leading to the present application before the High Court.
Issues
- Whether proceedings for determination of mesne profits can continue when the decree for possession has been stayed in entirety.
- Whether the Small Causes Court erred in holding that only the possession aspect of the decree was stayed, not the mesne profits inquiry.
- How the provisions of Order XX Rule 12 and Order XLI Rule 5 CPC should be interpreted in this context.
Petitioner’s Arguments
The tenants argued that the High Court’s stay of “effect, operation and implementation” of the appellate decree was comprehensive. Thus, all proceedings arising out of the decree, including mesne profits, must be stayed. They stressed that they were already depositing interim compensation as directed by the Court, which safeguarded the landlord’s interests.
It was contended that continuing the mesne profits proceedings would waste judicial time and resources if the revision ultimately succeeded and the decree was set aside. The petitioners relied heavily on the plain wording of the High Court’s interim order and the comprehensive nature of the stay.
Respondent’s Arguments
The landlord opposed the application, contending that proceedings for mesne profits are independent and akin to a separate money suit. They argued that the stay of the decree only extended to execution of possession and did not affect the right to pursue mesne profits.
Relying on Order XX Rule 12 CPC, the landlord argued that the right to apply for mesne profits accrues with the decree for possession and does not depend on its finality. They referred to the Bombay High Court ruling in Purushottam Bajranglal Agarwal v. Nag Vastra Bhandar (1979 Mh.L.J. 87), which held that enquiry into mesne profits could proceed even if delivery of possession was stayed, though payment might be deferred.
Analysis of the Law
The Court examined Order XX Rule 12 CPC, which allows a decree for possession to include directions for mesne profits—past, present, and future. It also considered Order XLI Rule 5 CPC, which empowers appellate courts to stay “proceedings under a decree or order appealed from.”
The Court clarified that mesne profits are a necessary adjunct of a decree for possession, as they stem from the finding that possession has become wrongful. Thus, where the decree is stayed in its entirety, all connected proceedings—including mesne profits—must also be halted.
However, the Court distinguished this case from Purushottam Bajranglal Agarwal, noting that in that matter the stay order was expressly limited to possession, while enquiry into mesne profits was allowed to continue. In contrast, in the present case, the High Court had stayed the decree “as a whole,” which necessarily included mesne profits.
Precedent Analysis
- Purushottam Bajranglal Agarwal v. Nag Vastra Bhandar (1979 Mh.L.J. 87): Held that enquiry into mesne profits can proceed even when delivery of possession is stayed. Distinguished here because the stay in that case was partial, while in the present case it was complete.
- Order XX Rule 12 CPC: Defines decrees for possession and mesne profits as composite in nature.
- Order XLI Rule 5 CPC: Grants appellate courts discretion to stay all or part of proceedings under a decree; here, the High Court had stayed the decree in entirety.
Court’s Reasoning
The Court held that:
- The decree for possession and mesne profits is a composite decree; mesne profits flow directly from the finding of wrongful possession.
- Since the High Court had stayed the decree in its entirety, proceedings under it—including mesne profits—were also stayed.
- Allowing mesne profits proceedings to continue would risk rendering them futile if the revision succeeded, thereby wasting judicial and party resources.
Accordingly, the Court concluded that the Small Causes Court’s refusal to stay the mesne profits petition was unsustainable.
Conclusion
The High Court allowed the interim application and stayed the mesne profits petition and related execution proceedings until final disposal of the civil revision.
Implications
This ruling clarifies that when appellate or revisional courts stay a decree in entirety, all consequential proceedings—including mesne profits—must also remain stayed. It distinguishes between partial and complete stays, providing guidance for both decree-holders and judgment-debtors.
The decision also safeguards judicial efficiency, ensuring that proceedings do not continue unnecessarily where their outcome depends on the fate of a stayed decree.
FAQs
Q1. Can mesne profits proceedings continue if possession decree is stayed?
Not if the decree is stayed in entirety. All proceedings under the decree, including mesne profits, are halted.
Q2. What happens if only delivery of possession is stayed?
In that case, as in Purushottam Bajranglal Agarwal, mesne profits enquiry may continue, though payment may be deferred.
Q3. Why did the Court stay mesne profits proceedings here?
Because the High Court had stayed the decree in entirety. Continuing the enquiry would waste time and resources if the decree is later set aside
