Synopsis

The appellants (defendants) were granted temporary licence of 2,500 sq. feet in Block No. 4 of a commercial complex by the respondent (plaintiff) vide letter dated 17.03.1994 for a period of nine months, pending construction in Block No. 5 which had been allotted to them. Despite expiry of the licence period and repeated revocation notices, the appellants continued in possession. The trial court decreed possession and awarded mesne profits at Rs.75/- per sq. foot from 23.11.1996. The High Court upheld the decree for possession, holding that the appellants, having entered possession as licensees, were estopped from challenging the plaintiff's title. However, the court modified the mesne profits, restricting them to three years prior to the suit (from 01.09.2002 instead of 23.11.1996), as claims for damages prior to three years from suit were barred by limitation. The interest and punitive costs were upheld.

1. Heading of the judgment

High court of delhi at new delhi

Regular first appeal no. 23 of 2021 with cm appl. no. 1811 of 2021

M/s. gallus chattels pvt. ltd. & ors. (appellants) vs. Ishwar industries ltd. (respondent)

Coram: hon'ble ms. justice neena bansal krishna

Core Law: Code of Civil Procedure, 1908 – Section 96 (appeals from original decrees) – Law of Licence vs. Lease – Recovery of possession from licensee – Mesne profits – Estoppel of licensee to deny licensor's title.

Court: High Court of Delhi at New Delhi
Coram: Hon'ble Ms. Justice Neena Bansal Krishna (Single Judge)
Date of Judgment: June 5, 2026
Case No.: RFA No. 23 of 2021 with CM Appl. No. 1811 of 2021
Citation: 2026:DHC:5097

2. Legal framework

Major laws and provisions involved:

• Code of Civil Procedure, 1908 – Section 96 (regular first appeal), Order VI Rule 15 (verification of pleadings), Order IV Rule 1 (institution of suit), Order XLI Rule 1 (contents of appeal), Order VII Rule 11 (rejection of plaint – valuation/jurisdiction)

• Indian Evidence Act, 1872 – Section 116 (estoppel of tenant/licensee to deny landlord's title)

• Limitation Act, 1963 – Article 65 (possession) and Article 66 (mesne profits – three years limitation)

• Registration Act, 1908 – Sections 17 and 49 (registration of documents affecting immovable property)

Subject matter of the judgment:

Whether a person who enters into possession of immovable property as a licensee for a fixed term can, after expiry of the licence and revocation, claim ownership rights or challenge the licensor's title; and whether the trial court's award of mesne profits from a date prior to three years before the suit is legally sustainable.

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