- (1.) Leave granted.
(2.) Heard the learned counsel for the parties.
(3.) We reduce the mesne profits in view of the principles laid down by the Constitution Bench of this Court in the case of Fateh Chand vs. Balkishan Dass, 1963 AIR(SC) 1405, following is the dictum : - "(17) The other question which remains to be determined relates to the amount of mesne profits which the plaintiff is entitled to receive from the defendant who kept the plaintiff out of the property after the bargain had fallen through. It is common ground that the defendant is liable for retaining possession to pay compensation from 01.06.1949 till the date of the suit and thereafter under Order 20, Rule 12(c) C.P. Code till the date on which the possession was delivered. The trial Court assessed compensation at the rate of Rs. 140/- per mensem. The High Court awarded compensation at the rate of Rs. 265/- per mensem. In arriving at this rate the High Court adopted a highly artificial method. The High Court observed that even though the agreement for sale of the property was for a consideration of Rs. 1,12,500/the plaintiff had purchased the property in 1947 for Rs. 63,000/- and that at the date of the suit that amount could be regarded as "the value for which the property could be sold at any time". The High Court then thought that the proper rate of compensation for use and occupation of the house by the defendant when he refused to give up possession after failing to complete the contract should have some relation to the value of the property and not to the price agreed as sale price between the parties, and computing damages at the rate of five per cent on the value of the property they held that Rs. 3,150/- was the annual loss suffered by the plaintiff by being kept out of possession, and on that footing awarded mesne profits at the rate of Rs. 265/- per mensem prior to the date of the suit and thereafter. The plaintiff is undoubtedly entitled to mesne profits from the defendant and 'mesne profits' as defined in Section 2(12) of the Code of Civil Procedure are profits which the person in wrongful possession of property actually received or might with ordinary diligence have received therefrom, together with interest on such profits, but do not include profits due to improvements made by the person in wrongful possession. The normal measure of mesne profits is therefore the value of the user of land to the person in wrongful possession. The assessment made by the High Court of compensation at the rate of five per cent of what they regarded as the fair value of the property is based not on the value of the user, but on an estimated return on the value of the property, cannot be sustained. The Attorney-General contended that the premises were governed by the Delhi & Ajmer-Merwara Rent Control Act XIX of 1947 and nothing more than the 'standard rent' of the property assessed under that Act could be awarded to the plaintiff as damages. Normally a person in wrongful possession of immovable property has to pay compensation computed on the basis of profits he actually received or with ordinary diligence might have received. It is not necessary to consider in the present case whether mesne profits at a rate exceeding the rate of standard rent of the house may be awarded, for there is no evidence as to what the 'standard rent' of the house was. From the evidence on the record it appears that a tenant was in occupation for a long time before 1947 of the house in dispute in this appeal and another house for an aggregate rent of Rs. 180/- per mensem, and that after the house in dispute was sold, the plaintiff received rent from that tenant at the rate of Rs. 80/- per mensem, and the vendor of the plaintiff at the rate of Rs.106/ per mensem. But this is not evidence of standard rent within the meaning of the Delhi and Ajmer-Merwara Rent Control Act, XIX of 1947. (18) The Subordinate judge awarded mesne profits at the rate of Rs. 140/- per mensem and unless it is shown by the defendant that was excessive we would not be justified in interfering with the amount awarded by the Subordinate judge. A slight modification, however, needs to be made. The plaintiff is not only entitled to mesne profits at the monthly rate fixed by the Trial Court, but is also entitled to interest on such profits vide Section 2(12) of the Code of Civil Procedure. We, therefore, direct that the mesne profits be computed at the rate of Rs. 140/- per mensem from 01.06.1949 till the date on which possession was delivered to the plaintiff (such period not exceeding three years from the date of decree) together with interest at the rate of six percent on the amount accruing due month after month.";