MANU/DE/1072/2020

Equivalent Citation: AIR2020Delhi96, 269(2020)DLT1, 2020(1)RC R(Rent)468

IN THE HIGH COURT OF DELHI

R.C. Rev. 447/2017
Decided On: 21.05.2020
Appellants: Ramanand and Ors.
Vs.
Respondent: Girish Soni and Ors.
Hon'ble Judges/Coram:
Prathiba M. Singh, J.
Counsels:
For Appellant/Petitioner/Plaintiff: Rajiv Talwar and Tarun Rana, Advocates
For Respondents/Defendant: Sanjeev Mahajan, Advocate
Case Note:
Tenancy - Suspension of rent payment - COVID-19 lockdown crisis -
Implications thereof - Eviction otherwise sought on the ground of bonafide
requirement - Section 14(1)(e) of the Delhi Rent Control Act, 1958 -
Suspension of rent sought by applying doctrine of frustration and force
majeure reasons - Sections 32, 34 and 56 of the Indian Contract Act, 1872
(ICA) - Whether lockdown would entitle tenants to claim waiver or exemption
from payment of rent or suspension of rent? - It was contended by the
Tenants that due to the lockdown, there was complete disruption of all
business activities, including their business - Waiver thus pleaded citing force
majeure reasons beyond their control - Held, there was no rent agreement or
lease deed between the parties and hence Section  32  of the Contract
Actwould not apply - Section  56  of the ICA does not apply to tenancies -
There is no contractual condition that permits non-payment or suspension of
rent and case also not covered under any executive orders - Tenants'
application for suspension of rent liable to be rejected - While holding that
suspension of rent is not permissible in these facts, some postponement or
relaxation in the schedule of payment can be granted owing to the lockdown -
Tenants directed to pay the use and occupation charges as directed[30], [32],
[33]
DECISION
Prathiba M. Singh, J.
CM APPL. 10848/2020
1 . This is an application for exemption from filing the duly affirmed affidavit and the
requisite court fee. With an undertaking to deposit the court fee within 72 hours from
the date of resumption of regular functioning of this Court, exemption is allowed,
subject to all just exceptions. Undertaking filed by the Appellants is accepted.
2. Application is disposed of.

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CM APPL. 10847/2020
Brief Facts
3 . The urgent application under consideration, raises various issues relating to
suspension of payment of rent by tenants owing to the COVID-19 lockdown crisis and
the legal questions surrounding the same. The COVID-19 pandemic has had large-scale
implications for human life. Contractual relationships and jural relationships between
parties are severely affected due to the lockdown. The question as to whether the
lockdown would entitle tenants to claim waiver or exemption from payment of rent or
suspension of rent, is bound to arise in thousands of cases across the country. Though
there can be no standard rule that can be prescribed to address these cases, some
broad parameters can be kept under consideration, in order to determine the manner in
which the issues that arise can be resolved.
Background facts
4 . The present revision petition was filed by the Appellants/Tenants (hereinafter,
"Tenants") challenging the order dated 18th March, 2017 passed by the ld. Senior Civil
Judge-cum-Rent Controller (hereinafter, "RC") granting a decree of eviction in respect
of Shop No. 30-A, Khan Market, New Delhi (hereinafter, "tenanted premises"). The
Tenants run a shoe store called 'Baluja' in Khan Market where they sell various types of
foot wear. The Landlord i.e., Respondent No. 1 (hereinafter, "Landlord") is a Dentist.
The tenanted premises was given on rent for commercial purposes through a lease deed
executed on 1st February, 1975 at Rs. 300/- per month. In 2008, the Respondents filed
an eviction petition under Section 14(1)(e) of the Delhi Rent Control Act, 1958
(hereinafter, "DRC Act"). Initially, leave to defend was granted by the RC on 31st March,
2012. However, vide the impugned order dated 18th March, 2017, a decree for eviction
was passed. The Tenants filed an appeal against the impugned order which was
dismissed by the ld. Rent Control Tribunal (hereinafter, "RCT") vide order dated 18th
September, 2017 on the ground that the same is not maintainable. Hence, the present
petition challenging the eviction order dated 18th March, 2017.
5 . The petition was first listed before this Court on 25th September, 2017, on which
date, the ld. Single Judge had stayed the order of eviction subject to certain terms. The
relevant observations in the said order are set out below:
"9. I have enquired from the counsels, the effect if any of the landlord, after
institution of the petition for eviction under Section 14(1)(e) of the Act, having
entered into an agreement to sell and which agreement to sell has admittedly
not fructified. It prima facie appears that it is not into the domain of the Rent
Control Act to decide even prima facie whether there was any such agreement
to sell or not. It has further been enquired, as to what will be the effect, if any,
on the petition for eviction under Section 14(1)(e) of the Act which has to be
decided at least at the first stage summarily, having remained pending at the
stage of leave to defend itself for nearly four years and what will be the effect
of the landlord for his urgent requirement, having in the interregnum at one
stage considered sale of the property.
1 0 . Since there are allegations with respect to several documents and new
documents which were obtained under the Right to Information Act, 2005, have
also been filed, it is deemed appropriate to call for the Trial Court record.
11. The counsel for the respondents also states that all the documents have not

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 been placed on record.
12. The Trial Court record be requisitioned forthwith.
13. Issue notice.
14. Notice is accepted by the counsel for the respondents.
15. Subject to the petitioners, with effect from the month of October, 2017,
paying to the respondents a sum of Rs. 3.5 lakhs per month, month by month,
in advance for each month by the 10th day of the English Calendar month,
there shall be stay of the order of eviction.
16. If there is any default in payment, the stay of execution of the order of
eviction shall stand vacated and the respondents shall be entitled to execute the
order of eviction.
1 7 . Needless to state that the aforesaid payments are subject to the final
adjudication of this petition and are repatriable in the event of the petitioners
succeeding in this petition.
18. CM No. 35119/2017 is disposed of.
19. List on 29th November, 2017."
The petition has thereafter remained pending for hearing.
6. Following the outbreak of COVID-19, an application for suspension of rent has now
been moved, during the lockdown period. The stand of the Tenants is that due to the
lockdown, there has been complete disruption of all business activities, including the
business of the Tenants. It is pleaded that the circumstances are force majeure and
beyond the control of the Tenants. Thus, it is claimed that the Tenants are entitled to
waiver of the monthly payment directed vide order dated 25th September, 2017, or at
least some partial relief in terms of suspension, postponement or part-payment of the
said amount.
Submissions of parties
7. Mr. Rajiv Talwar, ld. counsel for the Tenants, submits that he has moved the present
application by way of abundant caution as, vide the interim order dated 25th
September, 2017 this Court had directed that any default in payment would lead to
execution of the eviction decree. Ld. counsel submits that his clients are willing to make
part-payment of the monthly amount. Alternatively, he prays that the rent be suspended
for at least one month. He submits that since there has been no business during the
lockdown period, his clients are entitled to some form of remission.
8 . On the other hand, Mr. Sanjeev Mahajan, ld. counsel appearing for the Landlord,
submits that the Tenants have been enjoying the tenanted premises since 1975 for a
poultry sum of Rs. 300/- per month. Ld. counsel submits that the Tenants are well-to-
do business persons who have also purchased a neighbouring shop in Khan Market. He
further submits that the amount fixed by this Court i.e., Rs. 3,50,000/- per month, is a
very meagre amount compared to the prevalent market rate. He cites the example of
Shop No. 33 in Khan Market for which the monthly rent is approximately Rs. 22 lakhs
for a 1,456 sq. feet property. A photocopy of the lease deed of the said property has
also been submitted. Thus, it is submitted that the tenanted premises would earn much

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more than the amount fixed by this Court. Ld. counsel submits that force majeure does
not apply as the case is governed by the DRC Act. He further submits that the Landlord
is a Dentist who needs the shop for his own bona fide use. Ld. counsel contends that
mere disruption of the business cannot exempt the Tenants from making the monthly
payments as the Landlord also depends on the income from the tenanted premises.
9. On behalf of the Tenants, it is submitted that some rebate may be given only for the
period of the lockdown and that otherwise the Tenants are willing to regularly make the
monthly payments.
Analysis and Findings
10. This Court has considered the submissions of the parties. The relationship between
a Landlord and Tenant, a Lessor and Lessee and a Licensor and Licensee can be in
multifarious forms. These relations are primarily governed either by contracts or by law.
In the realm of contracts, the respective rights and obligations of the parties would be
determined by the terms and conditions of the contract itself.
11. Contracts of tenancy and leases could be of different kinds including-
(i) Oral tenancies with a month to month payment of rent;
(ii) Short term tenancy agreements with a monthly rent payable;
(iii) Long term leases with force majeure clauses;
(iv) Lease agreements which are structured as revenue sharing agreements
and;
(v) Lease agreements which are in the nature of monthly payments as a
percentage of the sales turnover.
The above list is however not exhaustive. The question of waiver, suspension or any
remission in the rental payments would operate differently for each category of
agreements. Where there is a contract, whether there is a force majeure clause or any
other condition that could permit waiver or suspension of the agreed monthly payment,
would be governed by the contractual terms. If, however, there is no contract at all or if
there is no specific force majeure clause, then the issues would have to be determined
on the basis of the applicable law.
12. In circumstances such as the outbreak of a pandemic, like the current COVID-19
outbreak, the grounds on which the tenants/lessees or other similarly situated parties
could seek waiver or non-payment of the monthly amounts, under contracts which have
a force majeure clause would be governed by Section 32 of the Indian Contract Act,
1872 (hereinafter, "ICA"). This section reads as under:
"32. Enforcement of contracts contingent on an event happening.--Contingent
contracts to do or not to do anything if an uncertain future event happens
cannot be enforced by law unless and until that event has happened.
If the event becomes impossible, such contracts become void."
13. 'Force Majeure' is defined by Black's Law Dictionary as "an event or effect that can
be neither anticipated nor controlled". As per the dictionary, "The term includes both
acts of nature (e.g. floods and hurricanes) and acts of people (e.g. riots, strikes and

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wars)".
14. The Supreme Court in Energy Watchdog v. CERC & Ors., MANU/SC/0408/2017 :
(2017) 14 SCC 80 has clearly held that in case the contract itself contains an express or
implied term relating to a force majeure condition, the same shall be governed by
Section 32 of the ICA. Section 56 of the ICA, which deals with impossibility of
performance, would apply in cases where a force majeure event occurs outside the
contract. The Supreme Court observed:
"34. "Force majeure" is governed by the Contract Act, 1872. Insofar as it is
relatable to an express or implied clause in a contract, such as the PPAs before
us, it is governed by Chapter III dealing with the contingent contracts, and
more particularly, Section 32 thereof. Insofar as a force majeure event occurs
dehors the contract, it is dealt with by a rule of positive law under Section 56 of
the Contact Act."
Thus, in agreements providing for a force majeure clause, the Court would examine the
same in the light of Section 32. The said clause could be differently worded in different
contracts, as there is no standard draft, application or interpretation. The fundamental
principle would be that if the contract contains a clause providing for some sort of
waiver or suspension of rent, only then the tenant could claim the same. The force
majeure clause in the contract could also be a contingency under Section 32 which may
allow the tenant to claim that the contract has become void and surrender the premises.
However, if the tenant wishes to retain the premises and there is no clause giving any
respite to the tenant, the rent or the monthly charges would be payable.
Section 56-Frustration of Contract
15. In the absence of a contract or a contractual term which is a force majeure clause
or a remission clause, the tenant may attempt to invoke the Doctrine of Frustration of
contract or 'impossibility of performance', which however would not be applicable in
view of the settled legal position set out below. The said doctrine of 'impossibility of
performance' is encapsulated in Section 56 of the ICA, which reads as under:
"56. Agreement to do impossible act.--An agreement to do an act impossible in
itself is void. Contract to do an act afterwards becoming impossible or
unlawful.--A contract to do an act which, after the contract is made, becomes
impossible, or, by reason of some event which the promisor could not prevent,
unlawful, becomes void when the act becomes impossible or unlawful.
Compensation for loss through non-performance of act known to be impossible
or unlawful.--Where one person has promised to do something which he knew,
or, with reasonable diligence, might have known, and which the promisee did
not know, to be impossible or unlawful, such promisor must make
compensation to such promisee for any loss which such promisee sustains
through the non-performance of the promise."
16. There are various conditions that have to be fulfilled to satisfy the conditions of
'impossibility' under Section 56. However, in the context of a tenant's obligations, the
Supreme Court had the occasion to consider this doctrine in the case of Raja Dhruv Dev
Chand v. Raja Harmohinder Singh & Anr., MANU/SC/0179/1968 : AIR 1968 SC 1024
where the tenant who had rented agricultural lands in Punjab which he could not utilise
due to the 1947 Partition, sought refund of the rent paid by him for the said land for
Kharif season 1947 and Rabi season 1948. The Supreme Court, after considering the

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law on 'impossibility of performance' from various jurisdictions, held that in the Indian
context Section 56 "lays down a positive rule relating to frustration of contracts and the
Courts cannot travel outside the terms of that section". The Court held that Section 56
does not apply to lease agreements. The Court drew a distinction between a 'completed
conveyance' and an 'executory contract' and observed:
"9. We are unable to agree with counsel for the appellant in the present case
that the relation between the appellant and the respondents rested in a
contract. It is true that the court of wards had accepted the tender of the
appellant and had granted him a lease on agreed terms of lands of Dada Siba
Estate. But the rights of the parties did not after the lease was granted rest in
contract. By Section 4 of the Transfer of Property Act the chapters and sections
of the Transfer of Property Act which relate to contracts are to be taken as part
of the Indian Contract Act, 1872. That section however does not enact and
cannot be read as enacting that the provisions of the Contract Act are to be read
into the Transfer of Property Act. There is a clear distinction between a
completed conveyance and an executory contract, and events which discharge a
contract do not invalidate a concluded transfer.
10. By its express terms Section 56 of the Contract Act does not apply to cases
in which there is a completed transfer. The second paragraph of Section 56
which is the only paragraph material to cases of this nature has a limited
application to covenants under a lease. A covenant under a lease to do an act
which after the contract is made becomes impossible or by reason of some
event which the promisor could not prevent unlawful, becomes void when the
act becomes impossible or unlawful. But on that account the transfer of
property resulting from the lease granted by the lessor to the lessee is not
declared void.
11. By the agreement of lease the appellant undertook to pay rent for the year
1947-48 and the Court of Wards agreed to give on lease the land in its
management. It is not claimed that the agreement of lease was void or
voidable. Nor is it the case of the appellant that the lease was determined in
any manner known to law. The appellant obtained possession of the land. He
was unable to continue in effective possession on account of circumstances
beyond his control. Granting that the parties at the date of the lease did not
contemplate that there may be riots in the area rendering it unsafe for the
appellant to carry on cultivation, or that the crops grown by him may be looted,
there was no covenant in the lease that in the event of the appellant being
unable to remain in possession and to cultivate the land and to collect the
crops, he will not be liable to pay the rent. Inability of the appellant to cultivate
the land or to collect the crops because of widespread riots cannot in the events
that transpired clothe him with the right to claim refund of the rent paid...."
1 7 . The above judgment laid down unequivocally that a lease is a completed
conveyance though it involves monthly payment and hence, Section 56 cannot be
invoked to claim waiver, suspension or exemption from payment of rent. This view of
the Supreme Court has been reiterated in T. Lakshmipathi and Ors. v. P. Nithyananda
Reddy and Ors., MANU/SC/0263/2003 : (2003) 5 SCC 150, as also in Energy Watchdog
(supra).
18. Recently, a ld. Division Bench of the Delhi High Court in Hotel Leela Venture Ltd. v.
Airports Authority of India, MANU/DE/2968/2016 : 2016 (160) DRJ 186, observed:

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 "34. The consideration for the lease being one; albeit having two constitutive
elements, the law declared by the Supreme Court in the decision reported as
MANU/SC/0179/1968 : (1968) 3 SCR 339 Raja Dhruv Dev Chand Vs. Raja
Harmohinder Singh & Anr. would squarely be applicable; and if it was the claim
by the lessee that the consideration for the lease failed or became oppressed,
the claim would fail because neither the doctrine of frustration applies to a
lease nor broad principles thereof to a lease. The reason being that executory
contracts alone are capable of being frustrated and not executed contracts. For
example, 'A' a retailer of shoes purchases shoes from 'B' who is the
manufacturer of shoes. The agreed quantities of shoes are delivered and part
sale consideration paid. On account of change in import policy the market is
flooded with imported shoes which are much cheaper vis-a-vis the price
payable by 'A' to 'B'. 'A' cannot plead frustration requiring the Court to reduce
the price and relieve him the obligation to pay the balance sale consideration to
'B'.
3 5 . A contract for lease whereunder the lessee obtains possession from the
lessor is an executed contract and during the duration of the lease, since it is a
term of the agreement that consideration shall be rendered periodically, the
agreed consideration has to be paid and it hardly matters that rents have fallen
in the meanwhile. The result of a lease is the creation of a privity of estate
inasmuch as lease is the transfer of an interest in immovable property within
the meaning of Section 5 of the Transfer of Property Act, 1882, as was held in
para 20 of the decision reported as MANU/SC/0263/2003 : 2003 (5) SCC 150 T.
Lakshmipathi & Ors. Vs. P. Nithyananda Reddy & Ors. That apart, as held in the
decisions reported as MANU/SC/0057/1960 : (1960) 2 SCR 793 Alopi Prashad
Vs. UOI and MANU/SC/0701/1975 : (1975) 2 SCC 633 Panna Lal Vs. State of
Rajasthan a contract is not discharged merely because it turns out to be difficult
or onerous for one party to perform and none can resile from a contract for said
reason."
From the above judgments and the settled law, it is clear that Section 56 of the ICA
would not apply to a lease agreement and other similarly situated contracts which are
'executed contracts' and not 'executory contracts'.
Provisions of the Transfer of Property Act, 1882 governing landlord-tenant relationships
qua Force Majeure
19. In the absence of contracts or contractual stipulations the provisions of the Transfer
of Property Act, 1882 (hereinafter, "TPA") would govern tenancies and leases.
2 0 . The doctrine of force majeure is recognised in Section 108(B)(e) of the TPA.
Section 108(B)(1) also enumerates the 'Rights and Liabilities' of the lessee. The
relevant clauses of the TPA are as under:
"108. Rights and liabilities of lessor and lessee.--In the absence of a contract or
local usage to the contrary, the lessor and the lessee of immoveable property,
as against one another, respectively, possess the rights and are subject to the
liabilities mentioned in the rules next following, or such of them as are
applicable to the property leased:--
(A) Rights and liabilities of the lessor-
...

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 (B) Rights and liabilities of the lessee-
...
(e) if by fire, tempest or flood, or violence of an army or of a mob, or
other irresistible force, any material part of the property be wholly
destroyed or rendered substantially and permanently unfit for the
purposes for which it was let, the lease shall, at the option of the
lessee, be void:
Provided that, if the injury be occasioned by the wrongful act
or default of the lessee, he shall not be entitled to avail himself
of the benefit of this provision: ...
(f) to (k).......
(l) the lessee is bound to pay or tender, at the proper time and
place, the premium or rent to the lessor or his agent in this
behalf;"
A perusal of the above shows that the provision itself would apply only in the absence
of a contractual stipulation. Further, on the occurrence of any of the situations
contemplated under (e) above, which would render the property 'substantially and
permanently unfit' to be used for the purpose for which it was leased, at the option of
the lessee, the lease would be void.
21. In Raja Dhruv (supra) the Supreme Court, while interpreting as to what constitutes
'substantially and permanently unfit' held that temporary non-use by the tenant due to
any factors would not entitle the tenant to invoke this section. The relevant observations
of the Court are:
17. The case strongly relied upon by counsel for the appellant was Gurdarshan
Singh v. Bishen Singh [MANU/PH/0017/1963 : ILR 1962 Punjab 5]. In that case
a lease was executed on January 8, 1947 in respect of agricultural land situated
in an area which on partition of India fell within West Pakistan. The Court found
that possession of the demised land was not given to the lessee, and the
landlord was on account of riots unable to deliver possession. Obviously on
that finding the tenant was entitled to claim refund of the rent paid. But the
Court proceeded to consider the question "whether the doctrine of frustration
applies to a contract of lease of agricultural lands" and recorded an answer that
the doctrine of frustration applies to leases. The Court observed at p. 13--"that
the doctrine of frustration does apply to leases, but even if it does not apply in
terms to a contract of lease of agricultural land the broad principle of
frustration of contract applies to leases". We are unable to agree with that
observation, and the observation at p. 11 that "According to Indian law, sales
of land as also leases are contracts". Under a lease of land there is a transfer of
right to enjoy that land. If any material part of the property be wholly destroyed
or rendered substantially and permanently unfit for the purpose for which it was
let out, because of fire, tempest, flood, violence of an army or a mob, or other
irresistible force, the lease may, at the option of the lessee, be avoided. This
rule is incorporated in Section 108(e) of the Transfer of Property Act and
applies to leases of land, to which the Transfer of Property Act applies, and the
principle thereof to agricultural leases and to leases in areas where the Transfer
of Property Act is not extended. Where the property leased is not destroyed or

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 substantially and permanently unfit, the lessee cannot avoid the lease because
he does not or is unable to use the land for purposes for which it is let to him."
2 2 . In T. Lakshmipathi (supra), on the question of what constitutes permanent
destruction of a property, the Supreme Court cited with approval Woodfall's Laws of
Landlord and Tenant (28th Edition, Vol. 1):
"21. In Woodfall's Laws of Landlord and Tenant (28th Edn., Vol. 1) the relevant
law is so stated:
"Where the lessee covenants to pay rent at stated period (without any
exception in case of fire), he is bound to pay it, though the house be
burnt down; for the land remains, and he might have provided to the
contrary by express stipulation, if both parties had so intended. And
this rule applies, although the lessee's covenant to repair contain an
exception in case of fire. Similarly, an action for use and occupation
still lies in respect of the whole period of the tenancy notwithstanding
the destruction of the premises by fire."
(para 1-0778)
"In a lease of land with buildings upon it the destruction of even the
entirety of the buildings does not affect the continuance of the lease or
of the lessee's liabilities under it, unless so provided by express
contract."
(para 1-2055)
"A demise must have a subject-matter, either corporeal or incorporeal.
If the subject-matter is destroyed entirely, it is submitted that the lease
comes automatically to an end, for there is no longer any demise. The
mere destruction of a building on land is not total destruction of the
subject-matter of a lease of the land and building, so the demise
continues. But if by some convulsion of nature the very site ceases to
exist, by being swallowed up altogether or buried in the depths of the
sea, it seems clear that any lease of the property must come to an
end."
(para 1-2056)"
2 3 . In Shaha Ratansi Khimji & Sons v. Kumbhar Sons Hotel Pvt. Ltd. & Ors.,
MANU/SC/0602/2014 : (2014) 14 SCC 1 the Supreme Court clarified that in cases
concerning a lease agreement, Section 108(B)(e) of the TPA cannot be interpreted by
assuming that when a building or structure is leased out, it is only the superstructure
that is exclusively leased out. The lease is also a lease of site. In view of the law laid
down in T. Lakshmipathi (supra), it was held that even though the tenanted premises
had been demolished and destroyed, the tenancy cannot be said to have been
determined.
24. More recently, this view has been reaffirmed by this Court in Sangeeta Batra v. M/s.
VND Foods & Ors., MANU/DE/1894/2015 : (2015) 3 DLT (Cri.) 422 wherein it has been
held that the fact that the leased premises, intended to be run as a restaurant, was
sealed on two occasions is of no relevance as the tenants did not choose to avoid the
lease. Interpreting Section 108 of the TPA, the ld. Single Judge of this Court observed:

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 "26. Section 108 of the Transfer of Property Act deals with the aspect of rights
and liabilities of lessor and lessee. The rights and liabilities of the lessee are
enumerated from clause (d) onwards upto clause (q). Clause (e) of Section 108
reads:
"(e) if by fire, tempest or flood, or violence of an army or of a mob, or
other irresistible force, any material part of the property be wholly
destroyed or rendered substantially and permanently unfit for the
purposes for which it was let, the lease shall, at the option of the
lessee, be void:
Provided that, if the injury be occasioned by the wrongful act or
default of the lessee, he shall not be entitled to avail himself of
the benefit of this provision;"
(Emphasis supplied)
27. Thus, if the leased premises is rendered substantially and permanently unfit
for the purpose for which it was let, the lessee has the option to avoid the
lease. Unless the lessee so avoids the lease, he cannot avoid his obligation
contained in clause (l) of Section 108, which states that "the lessee is bound to
pay or tender, at the proper time and place, the premium or rent to the lessor
or his agent in this behalf;".
25. Thus, for a lessee to seek protection under sub-section 108(B)(e), there has to be
complete destruction of the property, which is permanent in nature due to the force
majeure event. Until and unless there is a complete destruction of the property, Section
108(B)(e) of the TPA cannot be invoked. In view of the above settled legal position,
temporary non-use of premises due to the lockdown which was announced due to the
COVID-19 outbreak cannot be construed as rendering the lease void under Section
108(B)(e) of the TPA. The tenant cannot also avoid payment of rent in view of Section
108(B)(1).
Suspension of Rent
26. Finally, in the absence of a contract or a contractual stipulation, as in the present
case, the tenant may generally seek suspension of rent by invoking the equitable
jurisdiction of the Court due to temporary non-use of the premises. The question as to
whether the suspension of rent ought to be granted or not would depend upon the facts
and circumstances of each case as held by the Supreme Court in Surendra Nath Bibran
v. Stephen Court, MANU/SC/0237/1966 : AIR 1966 SC 1361. In the said case, the Court
directed payment of proportionate part of the rent as the tenant was not given
possession of a part of the property.
27. In Raichurmatham Prabhakar and Ors. v. Rawatmal Dugar, MANU/SC/0326/2004 :
(2004) 4 SCC 766 the Supreme Court held that suspension of rent may be claimed by
the tenant if the lessee has been dispossessed. Thus, mere non-use may not always
entitle the tenant for suspension of rent.
2 8 . This view has been followed by a ld. Single Judge of this Court in Aranya
Hospitality Management Services Pvt. Ltd. v. K.M. Dhoundiyal & Ors. [Arb. A. (Comm.)
6/2017, decided on 21st March, 2017], where the Court considered the force majeure
clause of the contract to hold that the mere non-approval by the concerned authority for
running a restaurant would not entitle the tenant to seek suspension of rent. The Court

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held that under circumstances wherein the tenant cannot use the property for the
purpose for which it was leased, the tenant would have no right to continue enjoying
the property and seek suspension of rent at the same time.
29. In relation to some contracts which are not classic tenancy or lease agreements,
where the premises is occupied and a monthly pre-determined amount is paid purely as
'Rent' or 'Lease amount', the manner in which pandemics, such as COVID-19, can play
out would depend upon the nature of the contract. In contracts where there is a profit-
sharing arrangement or an arrangement for monthly payment on the basis of sales
turnover, the tenant/lessee may be entitled to seek waiver/suspension, strictly in terms
of the clause. Such cases would purely be governed by the terms of the contract itself,
and the tenant's claim could be that there were no sales and no profits and thus the
monthly payment is not liable to be made. Thus, the entitlement of the client in such a
situation is not governed by any overriding force majeure event but by the consequence
of the said event, being that there were no sales or profits.
Conclusions:
30. In light of the above legal position, the Tenants' prayer for suspension of rent in
the present case is to be considered. There is no rent agreement or lease deed between
the parties and hence Section 32 of the ICA has no applicability. The case is governed
by the provisions of the Delhi Rent Control Act, 1958. Section 56 of the ICA does not
apply to tenancies. The Tenants also do not urge that the tenancy is void under Section
180 (B)(e) of the TPA. The tenants are also not 'Lessees' as an eviction decree has
already been passed against them.
31. The Tenants' plea is for extension of the doctrine of suspension of rent to cases
which are covered by lockdown due to COVID-19. Insofar as this prayer is concerned,
this Court considers the following factors as necessary for determining the question as
to whether the Tenants herein are entitled to any relief of suspension of rent:
i. Nature of the property: The tenanted premises are located in the prime
commercial area of Khan Market for running of a shop. It is well-known that the
commercial area of Khan Market is a sought-after location for business
purposes.
ii. Financial and social status of the parties: The Landlord is a dentist who
wishes to use the tenanted premises and has sought eviction on the ground of
bonafide use under Section 14(1)(e) of the DRC Act. The Tenants, on the other
hand, run a footwear shop on the tenanted premises, which they have been in
possession of since 1975 at a monthly rental of merely Rs. 300/-.
iii. Amount of rent: The monthly payment of Rs. 3.5 lakhs has been fixed by
this Court, as a condition for grant of stay for continued use and occupation,
after the decree of eviction was passed. The Tenants do not wish to vacate the
property due to the lockdown but wish to continue to occupy the property. The
amount being paid, when compared to the prevalent market rent in the area, is
on the lower side. This is clear from a perusal of the lease deed of a
neighbouring property placed on record by the Landlord. Even if the said lease
deed is to be ignored and not taken on record, judicial notice can be taken of
the fact that the prevalent rent in Khan Market is amongst the highest in the
whole of Asia. The amount being paid by the Tenants, though substantial, is on
the lower side as compared to other properties in Khan Market.

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 iv. Other factors: The Tenants are 'unauthorised occupants' of the tenanted
premises as a decree of eviction has already been passed. The monthly
payment of rent being made has been fixed by this Court vide the interim order
dated 25th September, 2017 in view of the judgment of the Supreme Court in
Atma Ram Properties (P) Ltd. v. Federal Motors (P) Ltd., MANU/SC/1047/2004 :
(2005) 1 SCC 705. The use and occupation charges have to be determined in a
manner so as to fully compensate the Landlord as if the Landlord had let out
the property to a third party. The Tenants are continuing to occupy the
premises and do not intend to vacate the same. In any case, the compensation
ought to be reasonable and should make up for the loss caused to the Landlord
due to delay in execution of the eviction decree. These factors completely tilt
the balance in favour of the Landlord.
v. Any contractual condition(s): There is no contractual condition that permits
non-payment or suspension of rent.
vi. Protection under any executive order(s): There are cases where the central
and state governments may have, from time to time, given protection to some
classes of tenants such as migrants, labourers, students, etc. These include
Order No. 40-3/2020-DM-I (A) dated 29th March, 2020 issued by the Ministry
of Home Affairs (MHA), Government of India and Order No.
F/02/07/2020/S.1/PT. File/81 dated 22nd April, 2020 and Order No. 122-A
F/02/07/2020/S.I/9 dated 29th March, 2020 both issued by the Delhi Disaster
Management Authority (DDMA), Government of NCT of Delhi. Without going
into the legality and validity of such Executive orders, suffice it to say that the
present case is not covered by any of these executive orders.
3 2 . The Tenants' application for suspension of rent is thus liable to be rejected
inasmuch as while invoking the doctrine of suspension of rent on the basis of a force
majeure event, it is clear from the submissions made that the Tenants do not intend to
surrender the tenanted premises. While holding that suspension of rent is not
permissible in these facts, some postponement or relaxation in the schedule of payment
can be granted owing to the lockdown.
33. It is accordingly directed that the Tenants shall now pay the use and occupation
charges for the month of March, 2020 on or before 30th May 2020 and for the months
of April, 2020 and May, 2020 by 25th June, 2020. From June 2020 onwards, the
payment shall be strictly as per the interim order dated 25th September 2017. Subject
to these payments being made, the interim order already granted shall continue. If there
is any default in payment, the interim order dated 25th September, 2017 would be
operational. The said interim order is very clear i.e., if there is any non-payment, the
decree would be liable to be executed.
34. The application is disposed of in the above terms.
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