2020 (11) TMI 496 - HC - Indian Laws

Cheque issued for Dishonor of Cheque - Recovery of arrears of rent - HELD THAT - There is no dispute that the petitioner is the head lessor ; the second respondent is the lessee ; and the first respondent is the sub lessee. At the outset, it is to be stated that the first respondent owes no amount to either the petitioner or the second respondent as arrears of rent. On the other hand, the second respondent failed to discharge her liability to the petitioner and was in arrears of rent for certain period, i.e., August 2010, July 2011 and from 01.04.2012 to 30.09.2013 - Admittedly, the second respondent issued the cheque for a sum of ₹ 14,885/-, which was returned with the endorsement funds insufficient , but there is no record to show that the petitioner had initiated any criminal prosecution against the second respondent under the Negotiable Instruments Act, 1881. Further, the issuance of the cheque itself goes to show that the second respondent admitted the liability and also the receipt of rent from the first respondent. Though the rent for the months of August 2010 and July 2011 were not paid the petitioner kept quiet for sometime, without taking any action and only issued the notice to the first respondent on 25.12.2011, a copy of which is not produced before this Court conveniently by the petitioner. Even thereafter, the petitioner had chosen to send another notice to the first respondent only on 10.03.2015 seeking the arrears of rent for the default committed by the second respondent, which was followed by a rejoinder notice dated 11.04.2015. The petitioner himself sent another representation on 20.10.2015 - However, taking note of the default on the part of the second respondent, the first respondent invoked clause 3(h) of the agreement dated 28.12.2005 and commenced to pay the arrears of rent directly from 01.10.2013, which was also communicated to the petitioner vide letter dated 06.06.2014 by the first respondent and the first respondent has categorically stated the same in the counter-affidavit. In the counter-affidavit, the first respondent also informed the second respondent to work out his remedies in the manner known to law, as per his contractual obligations with the second respondent and not against the first respondent. The first respondent could not have been mulcted with the liability to pay the arrears of rent, which was otherwise paid to the second respondent and it is open to the petitioner to redress his grievance with the second respondent in accordance with law - Petition dismissed.

Summary

Issues:
1. Direction sought for arrears of rent payment.
2. Dispute over arrears of rent between parties.
3. Invocation of lease agreement clauses.
4. Allegations and counter-affidavit submissions.
5. Liability of the first respondent for rent arrears.
6. Legal notices and representations exchanged.
7. Interpretation of lease agreement clauses.
8. Payment of arrears and communication between parties.
9. Conclusion and dismissal of the writ petition.

Analysis:
The petitioner sought a direction for the first respondent to pay arrears of rent, alleging non-payment for specific periods. The lease agreement chain involved the petitioner, the second respondent as lessee, and the first respondent as sub-lessee. The second respondent defaulted on rent payments, leading to disputes. The first respondent claimed to have resumed payments based on clause 3(h) of the lease agreement, transferring funds to the petitioner's account. The petitioner, however, insisted on arrears amounting to a significant sum, prompting legal notices and representations.

The court noted that the first respondent had no outstanding rent owed to either the petitioner or the second respondent. The issuance of a cheque by the second respondent indicated acknowledgment of liability. Despite delays in rent payments, the petitioner's actions, including notices and representations, were considered. The incorporation of clause 3(h) allowed the first respondent to directly pay arrears from a certain date, as communicated to the petitioner. The court emphasized that the first respondent couldn't be held liable for arrears already paid to the second respondent.

Ultimately, the court dismissed the writ petition, stating that the first respondent was not obligated to pay arrears already settled with the second respondent. The petitioner was advised to address grievances with the second respondent through legal means. The judgment highlighted the importance of contractual obligations and the enforcement of lease agreement clauses. The dismissal of the petition was concluded without any costs imposed, bringing closure to the legal dispute over rent arrears.