Tenant Denies ₹29,000 Rent and Claims ₹10 Lakh Mortgage Arrangement; Delhi High Court Relies on His Admissions, Upholds Eviction, Arrears and Enhanced Mesne Profits Award
Can Mesne Profits Be Increased Without Comparable Rent Evidence? Delhi High Court Says Courts May Take Judicial Notice of Rising Urban Rents
Facts
The dispute concerns a commercial shop measuring 238.38 sq. ft. The respondents, Madhu Chawla and Sanjay Chawla, claimed that they inducted appellant Siddhanth Mendiratta as tenant in 2014 at ₹25,500 per month, excluding water and electricity charges. SIDDHANTH
According to the landlords, a fresh Rent Agreement dated 22 August 2018 fixed rent at ₹29,000 per month for 11 months from 1 September 2018 to 31 July 2019. After expiry, they declined to extend the tenancy and issued a termination notice dated 7 September 2019, demanding possession and arrears. SIDDHANTH
The tenant took a materially different position. He asserted that he had paid ₹10 lakh between November 2016 and March 2017 towards a mortgage/security arrangement, because of which the rent/maintenance payable was only ₹2,900 per month. He also claimed that the landlords were attempting to evict him without returning the ₹10 lakh. SIDDHANTH SIDDHANTH
The landlords sued for possession, arrears of rent, electricity charges, damages and mesne profits. The District Judge decreed the suit on 23 April 2026, resulting in the present Regular First Appeal. SIDDHANTH
Issues
The principal issues were:
- Whether the tenant had proved the alleged ₹10 lakh mortgage/security arrangement and consequential rent of ₹2,900 per month.
- Whether the disputed Rent Agreement dated 22 August 2018 had been legally proved despite denial of the tenant’s signatures.
- Whether the landlords could rely upon the tenant’s own admissions concerning the earlier tenancy and rate of rent.
- Whether the unregistered 2018 agreement could be relied upon to determine contractual rent.
- Whether mesne profits could be enhanced periodically in the absence of direct evidence of comparable market rentals.
- Whether the Trial Court’s decree for possession, arrears and mesne profits warranted interference in a first appeal.
Appellant’s Arguments
The tenant principally attacked the 2018 Rent Agreement, Ex. PW-1/5.
He argued that once he specifically denied his signatures, the landlords were required under Section 67 of the Evidence Act to independently prove that the signatures were his. Mere production of the document did not prove its authorship or execution. SIDDHANTH
He further argued that proof of notarisation is distinct from proof of execution. The Notary Public identifying his own signature could not establish that the tenant had signed the underlying agreement. SIDDHANTH
The Notary had also issued contradictory certificates regarding whether the agreement had actually been notarised, and failed to produce the relevant Notary Register. The appellant therefore argued that the document was unreliable. SIDDHANTH
Another challenge concerned registration. Since the 2018 document allegedly mentioned a five-year term, the appellant contended that it was compulsorily registrable under Section 17(1)(d) of the Registration Act, 1908, and could not be used substantively to prove the lease terms or rent. SIDDHANTH
Finally, he challenged the award of mesne profits with 15% enhancement every three years, arguing that no comparable market-rent evidence supported such an increase. SIDDHANTH
Respondents’ Case
The landlords’ case was straightforward: Siddhanth Mendiratta was admittedly their tenant from 2014.
The original rent was ₹25,500 per month and was subsequently enhanced. The alleged ₹10 lakh mortgage arrangement was denied.
Their evidence included the 2014 and 2018 Rent Agreements, legal notice and supporting documents. SIDDHANTH
Analysis of the Law
1. Tenant’s Own Admissions Became Decisive
The High Court found that the controversy did not ultimately depend entirely upon whether every aspect of the disputed 2018 agreement had been independently proved.
The tenant himself admitted two fundamental facts:
First: he had occupied the premises since 2014.
Second: he was a tenant.
He merely disputed the amount of rent. SIDDHANTH
More significantly, during cross-examination, the tenant admitted that:
- he took the premises in 2014 at ₹25,500 per month including maintenance;
- the Rent Agreement was for 11 months;
- rent was to increase by 10% annually;
- another agreement was executed in 2015;
- a third agreement was executed in 2017; and
- another Rent Agreement was executed in 2018 for 11 months. SIDDHANTH
The High Court therefore observed:
“There could be no better evidence than the admissions of the Defendant himself.” SIDDHANTH
This is the central evidentiary proposition of the judgment.
2. ₹10 Lakh Mortgage Defence Was Not Proved
The tenant attempted to explain the drastic reduction from ₹25,500 to ₹2,900 by asserting that he had paid ₹10 lakh towards mortgage/security.
But he could not establish payment of that amount.
His own mother, examined as DW-5, admitted in cross-examination that she had not paid any money, despite the defence seeking to rely upon such payment. SIDDHANTH
Further, although the tenant admitted execution of several rent agreements between 2014 and 2018, he produced none containing any covenant recording the alleged ₹10 lakh mortgage arrangement. SIDDHANTH
The High Court therefore affirmed the finding that the alleged ₹10 lakh payment was unproved.
3. Failure of Tenant’s Defence Did Not Automatically Prove Landlords’ Case
The appellant correctly argued as a proposition of evidence law that merely because his ₹10 lakh defence failed, the landlords did not automatically prove every allegation made by them.
The burden of proving their own case remained upon the landlords.
However, that principle did not assist him because there was independent affirmative evidence, particularly his own admissions, establishing the original tenancy and ₹25,500 rent.
Thus, the Court did not uphold the decree merely because the tenant’s alternative explanation failed.
4. Disputed ₹29,000 Agreement Was Not Ultimately Essential
This is an important nuance.
Although the landlords asserted that the 2018 rent was ₹29,000, the Trial Court’s operative computation relied upon the 2014 Rent Agreement at ₹25,500, a rate which the tenant himself had admitted.
The High Court specifically noted that the Trial Court relied upon the agreement dated 24 April 2014, Ex. PW-1/12, recording rent at ₹25,500, which was also admitted by the defendant. SIDDHANTH
Accordingly, the tenant’s elaborate objections concerning:
- proof of his signature on the 2018 agreement;
- contradictory evidence of the Notary;
- registration; and
- stamping
did not dislodge the decree founded upon the earlier admitted tenancy and rent.
5. Status After Termination
The Trial Court had held that after expiry of the fixed tenancy, the defendant continued as a tenant by sufferance/month-to-month tenant under Section 106 of the Transfer of Property Act until termination.
Following service of the termination notice dated 7 September 2019, his continued occupation attracted liability for damages/mesne profits. SIDDHANTH
Mesne Profits
The appellant argued that the Trial Court could not simply assume a 15% increase without evidence of prevailing market rent.
The High Court examined this through M/s Sahara India v. M.C. Agrawal HUF.
It reiterated that under Section 2(12) CPC, mesne profits against an erstwhile tenant represent the amount the premises could reasonably have fetched if let during the period of wrongful occupation. SIDDHANTH
Ordinarily, this can be proved through evidence concerning rents of comparable premises.
However, where such evidence is unavailable, courts may take judicial notice of increasing urban rentals under Sections 57 and 114 of the Evidence Act and apply a reasonable enhancement over the last contractual rent. SIDDHANTH
The Court also relied upon M/s Priya Exhibitors (P) Ltd. v. Oriental Bank of Commerce, where mesne profits for commercial premises were assessed using the contractual rent with a 15% enhancement for subsequent periods. SIDDHANTH
Precedent Analysis
M/s Sahara India v. M.C. Agrawal HUF, 2011 SCC OnLine Del 3715
The judgment establishes that mesne profits payable by an erstwhile tenant should ordinarily represent the rent that the premises could fetch during unauthorised occupation.
Where direct comparable-rental evidence is absent, the Court may take judicial notice of the general increase in urban rents. SIDDHANTH
M/s Priya Exhibitors (P) Ltd. v. Oriental Bank of Commerce
The Delhi High Court had previously approved assessment of mesne profits for commercial premises by enhancing the contractual rent by 15% for subsequent periods, together with interest. SIDDHANTH
Bank of India v. Alibhoy Mohammed
Relied upon by the appellant for the principle under Section 67 of the Evidence Act that where execution is denied, the signature attributed to the executant must be proved. Mere production of a document does not prove execution. SIDDHANTH
Radhakrishna Nagesh v. State of Andhra Pradesh, (2012) 13 SCC 333
Cited for the proposition that a witness’s testimony must be read as a whole rather than selectively extracting favourable portions. SIDDHANTH
Mallappa v. State of Karnataka, (2024) 3 SCC 544
Relied upon for the requirement that evidence must be comprehensively assessed; selective appreciation may cause a miscarriage of justice. SIDDHANTH
Court’s Reasoning
The High Court’s reasoning ultimately rested less upon the disputed 2018 document and more upon the tenant’s own admissions.
The appellant admitted:
Tenancy from 2014 → ₹25,500 rent → 11-month agreements → agreed enhancement → successive rent agreements → another agreement in 2018.
Against these admissions, his case that rent had somehow fallen to only ₹2,900 because of a ₹10 lakh mortgage required convincing proof.
None was produced.
His mother did not support the alleged payment, the admitted successive rent agreements contained no proven mortgage covenant, and the ₹10 lakh transaction itself remained unestablished.
The Trial Court was therefore justified in proceeding on the admitted ₹25,500 monthly rent, rather than the disputed ₹29,000 figure.
The Court further found no error in awarding mesne profits by periodically enhancing the last established contractual rent, given the jurisprudence permitting judicial notice of increases in urban commercial rentals.
Conclusion
The Delhi High Court found no merit in Siddhanth Mendiratta’s appeal and dismissed it along with the pending applications. SIDDHANTH
The decree consequently remained operative, including:
Rent: ₹25,500 per month for the relevant pre-termination period.
Mesne profits/use and occupation charges: based on ₹25,500 monthly rent with a 15% enhancement after every three years during unauthorised occupation until possession is handed over. SIDDHANTH
The judgment is particularly useful for the proposition that where a tenant attacks a later rent agreement but his own cross-examination unequivocally admits the original tenancy, contractual rent and successive lease arrangements, those admissions may independently sustain the landlord’s case.
Case Details
Case: Siddhanth Mendiratta v. Madhu Chawla & Anr.
Court: High Court of Delhi at New Delhi
Case Number: RFA 1008/2026 with CM APPL. 62482/2026 & CM APPL. 62483/2026
CNR: DLHC010435542026 SIDDHANTH
Judge: Justice Neena Bansal Krishna SIDDHANTH
Reserved: 15 September 2026
Pronounced: 28 September 2026 SIDDHANTH
Result: Appeal dismissed; decree for possession, arrears and mesne profits upheld
