Position of Minor's Agreement

Case: S. K. Sharma v. S. N. Sharma

Citation: AIR 2002 SC 3299

Court: Supreme Court of India

Bench: Justice Umesh C. Banerjee and Justice Y. K. Sabharwal

Decided on: October 18, 2002

Facts of the Case:

The case of S. K. Sharma v. S. N. Sharma deals with the concept of "mesne profits" under the Code of Civil Procedure (CPC), 1908. Mesne profits refer to the profits or benefits accrued by a person who is in wrongful possession of another's property. The plaintiff, S. K. Sharma, filed a suit against the defendant, S. N. Sharma, seeking possession of property and claiming mesne profits for the period during which the defendant was in wrongful possession.

The dispute arose over a piece of immovable property, where the plaintiff alleged that the defendant had wrongfully occupied and enjoyed the property, thereby depriving the plaintiff of its use and benefits. The plaintiff sought the recovery of possession along with mesne profits for the period during which the property was occupied by the defendant.

Issues:

1. Whether the defendant was in wrongful possession of the property.

2. Whether the plaintiff was entitled to recover mesne profits from the defendant.

3. The method of calculation of mesne profits.

Contentions:

Plaintiff's Argument:

The plaintiff argued that the defendant had no legal right to possess the property and had been occupying it without any lawful authority. As a result, the defendant was liable to pay mesne profits for the unauthorized use of the property.

2. Defendant's Argument:

The defendant contended that he had a legitimate right to occupy the property and, therefore, was not liable to pay any mesne profits. The defendant further argued that even if mesne profits were awarded, they should be calculated based on actual income generated from the property rather than an assumed or notional profit.

Judgment:

The Supreme Court, while examining the case, reiterated the legal principles governing mesne profits under the CPC. The Court observed that mesne profits are the profits which a person in wrongful possession of property actually received or might with ordinary diligence have received, from such property, together with interest on such profits.

The Court held that the defendant was in wrongful possession of the property and was, therefore, liable to pay mesne profits to the plaintiff. The Court emphasized that the objective of awarding mesne profits is to compensate the rightful owner for the loss incurred due to being deprived of the property.

Calculation of Mesne Profits:

The Court provided guidelines for the calculation of mesne profits, noting that it should be based on the actual income that could have been derived from the property with ordinary diligence. The Court further stated that while calculating mesne profits, considerations such as the nature of the property, the period of wrongful possession, and the income that could have been generated must be taken into account.

In the final decision, the Supreme Court directed the trial court to ascertain and quantify the mesne profits in accordance with the guidelines laid down. The case was remanded back to the trial court for the determination of the exact amount of mesne profits payable by the defendant to the plaintiff.

Significance:

This case is significant as it elucidates the legal concept of mesne profits under the CPC and provides clear guidelines for their determination. It highlights the Court's approach in ensuring that a rightful owner is compensated adequately for the wrongful deprivation of property.

The judgment serves as an important precedent in matters involving mesne profits, emphasizing the need for a fair and just calculation to prevent unjust enrichment of the party in wrongful possession.