Introduction

Natural law grants the essential rights to establish accountability for civil rights violations and mistreatment of another person's real property since mistreatment of real property includes the right to seek restitution for damages. A person who is in unauthorised or illegal possession is said to be in "mesne profits," which refers to the loss or recompense an owner may be able to recover.

Thus, the core of the mesne profits’ accusation and the liability of the illegitimate owner is unlawful property ownership. As a result, the responsibility to pay mesne profit ends when the land is actually in your possession. A constructive right that can be used to prevent the infringement of private legal law is the benefit of Mesne. Its primary goal is to make up for the genuine owner of the property who has been denied possession and the chance to enjoy it. The principle mostly pertains to making up for past wrongdoing.

The Hon'ble Court also narrowed and interpreted the meaning of a mesne profits claim in the case of K. B. Singh v. M. D. U. Co-Operative Association Ltd[1]., holding that the term's definition makes it clear that it can only be made with reference to immovable property.

Mesne Profit: The Conceptual Origin

The concept of mesne profits traces back to the medieval period and can be explained through the following chart-:

  • The feudal system- The King was the owner of all the land
  • He would let out lands to barons in promise of provision of soldiers to raise an army
  • This changed by charging of rent for letting out the land
  • The system grew in complexity as the barons further sublet the lands to tenant farmers in exchange of rent (which was usually in kind plus they kept some for themselves.)
Relevant Provisions under CPC for Mesne Profit

Mesne Profits are described in Section 2(12) of the Code of Civil Procedure as:

Mesne profits of property are defined as those profits that the person in wrongful possession of the property actually received or could have obtained with reasonable diligence, along with interest on those profits; however, profits attributable to improvements made by the person in wrongful possession are not included.

Mesne profits essentially refer to the fees that must be paid or the illegal use and occupation of real estate. A lessee, tenant, or licensee who occupies the property for a length of time longer than that for which authorization was granted, or whose occupancy is terminated by termination, revocation, or order of the court, is considered to be in unlawful possession and is responsible for paying mesne profits.

  1. The first need is that the land's current owner is holding onto the property illegally.
  2. The clause includes interest on those gains as well, but it is clear that it does not include any benefit from improvements done to the property by someone who is in illegal possession.
Meaning of Interest

A crucial component of mesne earnings is interest.[1] The decision to grant it or not rests solely with the Courts. [2]Furthermore, the plaintiff must specifically request the interest on mesne profits before it can be awarded. As a result, it is an essential claim rather than a right. An application for restitution may be used to assert a claim under Order 20 Rule 12 of the Code of Civil Procedure[3] and Section 144 of the Code.

Conditions for awarding Mesne Profit

Mesne profits can be awarded out in following:

  1. When there is specific claim: The court has the authority to decide on such a claim for mesne profits when a particular petition for mesne profits is made. In cases for partition, eviction, restitution, and other matters, an express claim for the same is typically stated.
  2. If a case is covered by Order 20 Rule 12Even though a particular petition has not been made for them, the court may still decide on a claim for future mesne earnings. But only when the complaint is covered by Order 20, Rule 12.[1]
Assessment of Mesne Profit

Any earnings made by the defendant as a result of his or her unlawful possession are considered in the calculation of mesne profit[1]. The time limit for its computation begins when the defendant obtained the improper possession, and it must be completed by the trial court. Considerations include factual conditions, justice, and any costs incurred by the defendants in order to generate profits.

The Court's calculations are only approximations or broad estimates. An award of mesne earnings is influenced by two main factors:

  1. The type of profit allegedly made
  2. The stage at which a Mesne Profit claim has been made
The type of profit claimed by Mesne: A lawsuit must be launched in order to assert a claim of mesne earnings, the supreme court has ruled in a number of situations. However, even if no claim is filed, mesne gains that occurred after the lawsuit can be investigated. This assertion is covered by Order 20 Rule 12.

Future Mesne Profits: Even if it hasn't been formally requested, the court has the power to recommend looking into prospective mesne profits[2], particularly in circumstances of partition where the court is obligated to do so. The Supreme Court made the declaration in 1963. The courts are given the ability to award future mesne revenues for two reasons:

  1. The plaintiff has no legal claim at the time the lawsuit was filed.
  2. The plaintiff is unable to assert this claim, value it, or pay the associated court costs.
Past Mesne Profits: The following requirements for the plaintiff must be met:

  1. The presence of a motivating fact.
  2. The claim must be specified and fairly valued.

(The first two requirements are necessary for past mesne profits.)

Stage at which Mesne Profit claim has been raised.

The stage at which the plea for a decree is decided restricts the Courts' latitude. If a court declines to "deliberately omit" or denies a mesne profits award during the preliminary decree stage, it cannot do so during the final decree stage. The same is not true for future earnings, where the preliminary decree's silence does not prevent the court from ordering an investigation at the final stage.

Limitation on awarding mesne profits

There are two types of constraints that we can observe:

  1. Time Restrictions: The Code's Order 20 Rule 12 limits the award of mesne earnings to three years. The time frame begins on the day the preliminary decree was issued. 35 The Supreme Court of India construed Order 20, Rule 12(c) in Fateh Chand's case to suggest that the mesne earnings must be granted up until the date when the immovable property was delivered.
  2. Interest-rate-based restriction: When distributing mesne profits, there is a 6% cap at the most.
Burden of Proof

It is intuitively obvious that the burden of proof lies with the party making the claim, in this case, the Plaintiff, and it is also a well-established legal concept. The steps required for this are:

  1. Plaintiff must demonstrate and establish ownership.
  2. Due to the Defendant's illegal possession, he or she was deprived.

The Madras High Court reaffirmed this in the case of Ramakka v. Nagesam. The complainant may also establish a claim for greater profits by showing that the property's illegal occupant did not exercise due diligence, according to the court's further addition.

Appointment of Commissioner

When it does not appear reasonable to the court for either party to do so, a commissioner is appointed, defined as an impartial person between the parties who is appointed by the court to collect the rents, issues, or profits of the property or other subject in dispute.[1] 

The court may, in the exercise of his or her discretion, appoint a receiver or commissioner to determine the amount of mesne profits due.[2]

The word "may" is not used in an obligatory manner. 

Case Laws

Mohammad Amin & Ors. v. Vakil Ahmed & Ors.

FACTS: The only question before the Hon'ble Supreme Court was whether mesne profits should be given under Order XX Rule 12, Code of Civil Procedure, 1908, if the appellant had not expressly prayed for an investigation pertaining to mesne profits. The learned Solicitor General, speaking on behalf of the appellant, argued that there was no need for mesne profits as such, but that the claim for mesne profits must be included within the expression, "awarding possession and occupation of the property aforesaid together with all the rights appertaining thereto."

HELD: The Supreme Court holding the High Court’s judgement as erroneous ruled that the plaintiff’s contention regarding inclusion of mesne profits within the given expression cannot be allowed and therefore the provision in regard to the same will have to be obliterated.

Chhaganmull Agarwalla v. Amanathulla Mohammad Prodhan

FACTSIn this case, the only question with respect to mesne profits was whether the defendant is entitled to pay mesne profits for the land which remained under attachment under the requirements of Section 146 of the Code of Criminal Procedure.

JUDGEMENTThe Hon'ble Court ruled that the "wrongful possession of the defendant is the very core of the argument for a mesh profit and the very basis of the decree therefor. Applying this concept, it is difficult to believe that, at the time the property was under annexation by the execution of the decree under Section 146, the Code of Criminal Procedure, and this Court was in custody on behalf of the legitimate owners, that is, the claimants in the present case, that the defendants were in possession of the land. Consequently, if the defendant is not in unlawful possession of the lands, he shall not be entitled to pay mesh profits for the land which remained under attachment under the meaning of section 146 of the Code of Criminal Procedure.

Lucy Kochuraveed v. P. Mariappa Gounder

FACTSB entered into a contract with A to purchase a factory from him. Subsequently, B accused A of evading the contract and filed a suit for specific performance and the decision came out in favour of A. Following this a suit for mesne profits and costs were filed by A which was allowed by both the trial court and the High Court, the later reducing the amount to be paid. B brought an appeal to the Supreme Court.

JUDGEMENTThe court held that the award of mesne profits will be moulded by the Court according to the justice of the case. Possession by another, such as a tenant, might be necessary to give rise to responsibility for mesne profits if such possession is incorrect and only the defendant found in actual possession of the property may be responsible for mesne profits. It upheld the decision of the Supreme Court.

Way Forward

The requirement for an appropriate and thorough definition: - Mesne profits are the profits that a person in unlawful possession of real estate is obligated to pay. However, this does not specify the particular conditions under which the same should or can be done.

The CPC's provisions do not establish a fixed or predetermined rate of interest with regard to mesne profits. Although the courts have typically permitted 6% annually, the relevant clause does not make this clear, which could lead to arbitrary decisions and the abuse of a discretionary power.

Additionally, there must be some degree of consistency in the factors that are taken into account when calculating median profit. While it is understandable that the courts find it difficult to provide for any uniform or so-called standard method of calculation due to the variety of the facts and circumstances of the case, the establishment of some fundamental guidelines—likely based on prior experience through case laws themselves—would enable a more uniform system.

Thus, it may be inferred that codifying specifics in the provisions will only help to make them more effective.

Conclusion

The Committee on Law, in its 178th report, suggests amending Order XX Rules 12 and 18, which are listed in the list of portions of various statutes that the suggested modifications are proposed, to make it mandatory to submit documentation of mesne benefit rentals up to the date the proceedings started. According to the law commission, Rule 12 of the CPC is decree-law in the majority of courts and an investigation is conducted about previous or possible rentals or mesne earnings in accordance with Order XX.

The courts often appoint the legal commissioners, report the facts, and hear the appeals over the course of years, after which a final decision is given. The preliminary decree on rent or benefits is passed after a decree is passed, and according to experience, it makes little difference after that. It normally takes another 5 years or more for the definitive decrees to be implemented after the preliminary decree. If benefit or lease decisions are made far after the preliminary decree, the case may have been running for years, and the delay will result in considerable discrimination.

In my opinion, regardless of whether a decree of ownership is passing or not, trial proof of rentals or mesne earnings should be documented in all States and discovered in courts. For courts, there must be a set process.

Similar to this, a preliminary order must be issued in accordance with Order 20 Rule 18(2) and include a statement of accounts as well as an initial calculation of the quantity and products of property partable. Rentals and income, in particular, must be decided automatically in some tribunals in some jurisdictions up until the date of the temporary decree. Not only does it save time, but it also provides the parties with quick justice.

In addition, the truth is that the presumption of evidence in the case of mesne profits essentially lied to the complainant because the mesne profits were paid before the claimant had to inform the court that he was the rightful owner of the property and had been defrauded of it by the defendant's wrongful ownership.


[1] Words and Phrases, Permanent Edition, Vol. 36A, Thomson West, 2003, p. 290

[2] N. Dasji v. Tirupathi Devasthanam, AIR 1965 SC 1231


[1] Harry K. Gray v.Bhagu Main, AIR 1930 PC 82; Fateh Chand v. Bal Krishan Das, AIR 1963 SC 1405

[2]Fateh Chand v. Bal Krishan Das, AIR 1963 SC 1405.


[1] Sudipto Sarkar, Code of Civil Procedure, 11th Ed., Vol. 1, Lexis Nexis Butterworths Wadhwa, Nagpur, 2011p. 1548


[1] Words and Phrases, Permanent Edition, Vol. 26C, Thomson West, 2003, p. 498.

[2] Sudipto Sarkar, Code of Civil Procedure, 11th Ed., Vol. 1, Lexis Nexis Butterworths Wadhwa, Nagpur, 2011p. 1548.

[3] Gopalkrishna Pillai v. Meenakshi Ayal, AIR 1967 SC 155


[1] K. B. Singh v. M. D. U. Co-Operative Association Ltd., AIR 1957 Manipur 9.

 

About the Author: This post is prepared by Aditya Kumar Pandey, Law student at National Law University, Odisha. He can be reached at 20bba003@nluo.ac.in

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