The landlord is Entitled to Mesne Profits: Supreme Court

A Supreme Court Bench consisting of Justice Indira Banerjee and Justice JK Maheshwari in the special leave petition filed by a tenant challenging an order of the Rajasthan High Court which had put a condition to pay Rs 2,50,000 as monthly rent to the landlord to stay on the order of the execution of the action of expelling
the tenant from the property.

The Court said that on the basis of determination of the amount of mesne
profit, in our view, depends on the facts and circumstances of each case
considering place where the property is situated i.e. village or city or
metropolitan city, location, nature of premises i.e. commercial or
residential are and the rate of rent precedent on which premises can be
let out are the guiding factor in the facts of individual case. In the case at
hand, the High Court in the impugned order observed that the tenanted
property is located on the main road of New Colony near Panch Batti
which is a commercial area in the heart of Jaipur City. The said finding
has been arrived at considering the voluminous documentary record
dispelling the plea taken by the Appellants. However, the Court in the
facts and circumstances found it reasonable to determine Rs.2,50,000/
per month as mesne profit. As per the discussion made hereinabove so
far as the area of the tenanted premises and the location of the property
is concerned, the findings of fact have been recorded by the High Court,
in our considered opinion, those findings are based on the material
brought on record which are neither perverse nor illegal. The amount of
mesne profit as fixed @ Rs.2,50,000/ is also just and proper looking at
the span of time i.e. 10 years from the date of fixing of the standard rent
and six year from the date of passing of the decree of eviction.
Therefore, the amount of mesne profit has rightly been decided by the
High Court while passing the order impugned.

The Supreme Court relied on judgments of Marshall Sons & Co. Ltd. vs Sahi
Oretrans Ltd. and Another, that once a decree for possession has been passed and
the execution is delayed then it is necessary for the Appellate Court to pass
appropriate orders fixing reasonable mesne profits which may be equivalent to the
market rent required to be paid by a person who is holding over the property.
Section 2(12) of the Code of Civil Procedure, 1908 defines the term “mesne
profits”. The Delhi High Court in the notable case of Phiraya Lal Alias Piara Lal vs
Jia Rani And Anr had interpreted the meaning of the term “mesne profit” by
observing that when a party claims damages to recover the loss resulting from the
wrongful occupation of immovable property by a trespasser that originally
belonged to the party then such damages will be known as mesne profits.
Calculation of Mesne Profit
After gaining an idea about mesne profits, it is now relevant to know how mesne
profits are calculated. The answer to this will be different from case to case basis
and as interpreted by the courts of law. If one goes by the provision, it gets clear
that there exists no fixed rule for assessing mesne profits. Therefore, the scope for
assessment of mesne profits has been left in the hands of the courts. It is thus ideal
to discuss this section of mesne profits by means of case laws.