1. Court’s decision
The Delhi High Court has dismissed an appeal filed under Order 43 Rule 1(c) challenging a trial court’s refusal to direct the alleged occupant of a residential property to deposit rent under Order 39 Rule 10 of the Code of Civil Procedure. The Court upheld the trial court’s finding that the very existence of a landlord–tenant relationship was disputed, that no written lease or contemporaneous tenancy document had been filed, and that the appellant relied only on selective bank entries which did not constitute an “admission” as required under Order 39 Rule 10 CPC.
The High Court held that the provision can be invoked only when the defendant admits liability, and “admission cannot be inferred when the foundational facts themselves are under challenge.” Therefore, the appellate court found no infirmity or perversity in the refusal to order deposit of rent and dismissed the appeal.
2. Facts
The appellant purchased a flat in Delhi through a registered sale deed dated 05.05.2015. She claimed she leased it to the respondent for a five-year term from 01.05.2015 at ₹25,000 per month, with periodic 15% rent enhancement. She stated that rent was enhanced twice in 2019 and was deposited by the respondent directly into her bank accounts.
According to the appellant, the respondent later refused access for maintenance and paid only ₹7,500 for August 2019 instead of the enhanced rent of ₹33,100. A legal notice seeking termination of tenancy and recovery of arrears was issued on 12.08.2019. Thereafter, she filed a suit for eviction, possession and arrears. Along with the suit, she sought a direction under Order 39 Rule 10 CPC directing deposit of rent pending trial.
The respondent, however, stated in his written statement that there was no tenancy at all. He alleged that he had borrowed ₹22 lakh from the appellant, and that under the guise of creating a mortgage, he was fraudulently made to sign a sale deed. He asserted that the sale deed was forged and fabricated, and that he continued to occupy the property as its owner.
The trial court dismissed the application under Order 39 Rule 10, holding that since the respondent denied tenancy and disputed the nature of payments, there was no “admitted amount” that could be ordered for deposit. The appellant challenged this rejection before the High Court.
3. Issues
- Whether the trial court erred in refusing to invoke Order 39 Rule 10 CPC.
- Whether payments made by the respondent could be construed as rent in the absence of a lease agreement.
- Whether the respondent’s denial of tenancy prevented the Court from directing deposit of the alleged rent.
- Whether an appellate court should interfere with the trial court’s exercise of discretion in an interlocutory matter.
4. Appellant’s arguments
The appellant argued that the respondent admitted in his written statement that he made certain payments, which the appellant maintained were rental payments, albeit described by the respondent as “interest” on an alleged loan. This, the appellant contended, was enough to justify a direction to deposit rent under Order 39 Rule 10.
Counsel submitted that the bank statement (Annexure P-5) clearly showed payments corresponding to rent, contradicting the respondent’s assertion before the trial court. The appellant argued that such payments should be treated as an admission of liability for at least the admitted portion of rent.
5. Respondent’s arguments
The respondent consistently denied any landlord–tenant relationship. He argued that the appellant had not produced a single document—no lease deed, no rent agreement, no rent receipts—to show tenancy. According to him, the payments made were part of repayment of a loan and not rent.
He asserted that his challenge to the sale deed’s validity and allegations of fraud created deep factual disputes, rendering Order 39 Rule 10 completely inapplicable. He maintained that he was the owner and that eviction proceedings were not maintainable.
6. Analysis of the law
The High Court reiterated the settled parameters of Order 39 Rule 10:
• It applies only when the defendant admits liability.
• The admission must be clear, unequivocal, and not a matter of inference.
• The provision is not designed to adjudicate disputed rights.
Here, the appellant failed to produce even a prima facie tenancy document. The only evidence cited was a bank statement reflecting certain transfers. These entries, however, were specifically asserted by the respondent to be payments towards a loan. The Court held that an “admission” cannot be carved out by recharacterising a contested transaction.
Where title, tenancy, payments, and the underlying nature of the relationship are all disputed, the Court cannot use Order 39 Rule 10 as a shortcut to examine evidence prematurely. These issues require a full trial.
The Court emphasised that invoking Order 39 Rule 10 in such circumstances would amount to deciding the core dispute at an interlocutory stage.
Thus, the conditions for exercise of the power were not met.
7. Precedent analysis
Though the judgment does not cite external case names, the reasoning tracks core principles from design jurisprudence on interlocutory admissions:
A. Requirement of unequivocal admission
Courts repeatedly hold that an admission must be explicit, not implied from contested facts or inferred from selectively interpreted documents.
B. No adjudication at interim stage
Interim applications cannot pre-decide the nature of the transaction, title disputes, or contractual foundation.
C. Landlord–tenant disputes
Where tenancy itself is disputed, courts consistently refuse to apply Order 39 Rule 10.
These principles align fully with the Court’s conclusion that the trial court’s approach was correct.
8. Court’s reasoning
The High Court found:
• The appellant produced no lease deed or rent agreement.
• The respondent categorically denied tenancy and ownership of the appellant.
• The respondent claimed the payments were loan-related; the appellant argued they were rent.
• The nature of the sale deed, its validity, payment purpose, and alleged fraud all required trial-level evidence.
The Court held that when foundational facts are in dispute, the trial court cannot create an assumption of tenancy or rent liability.
The appellate court also emphasised the limited scope of appeal against discretionary interlocutory orders, noting there was “no perversity, illegality or infirmity” in the trial court’s refusal.
9. Conclusion
The High Court upheld the rejection of the application under Order 39 Rule 10, holding that there was no admitted rent, no admitted liability, and no admitted landlord–tenant relationship.
The appeal was dismissed as meritless. All pending applications were closed.
10. Implications
This ruling reinforces:
• Order 39 Rule 10 is strictly admission-based.
• Courts will not direct deposit of rent when tenancy is denied.
• Bank transactions cannot be recharacterised as rent if disputed.
• Fraud, title, and tenancy questions must go to trial.
• Interlocutory jurisdiction cannot shortcut evidentiary issues.
The judgment provides clarity for practitioners in landlord–tenant, recovery, and civil litigation disputes.
CASE-LAW REFERENCE SECTION
(Summaries reflect principles applied; the judgment itself does not cite cases.)
Order 39 Rule 10 jurisprudence — Courts require explicit, unambiguous admission of liability; absence of such admission bars relief.
Interlocutory admission principles — When foundational facts are disputed, courts cannot infer admissions or decide contested issues.
Landlord–tenant dispute precedents — Where tenancy is itself denied, courts routinely refuse deposit-of-rent orders.
FAQs
1. Can a court order deposit of rent if the defendant denies tenancy?
No. Under Order 39 Rule 10 CPC, deposit can be ordered only when liability is admitted. If tenancy is denied, the provision cannot apply.
2. Is a bank statement enough to prove admitted rent?
Not if the defendant disputes the nature of the payment. Admission must be clear and uncontested.
3. Can the court examine ownership or fraud claims in a deposit application?
No. Disputes about ownership, sale deeds, or fraud must go to trial and cannot be adjudicated at an interim stage.
