Introduction
The essential premise that governs the operation of the Code of Civil Procedure, 1908 is ubi jus ibi remedium, which means “where there is a right, there is a remedy.” Because it is the law of nature to grant the right to compensation where a legal right has been infringed or breached, the concept of mesne profits was formed from this principle. Before getting into the concept of mesne profit, it’s important to clarify what “ownership” and “possession” mean. While the former is a man’s sole collective right to possess, enjoy, transmit, and destroy property that he owns, the latter serves as prima facie proof of the former. In the perspective of the law, the right to possess property is preserved until and until another individual claims to have a greater title to that property. When this type of claim develops, the law serves as a shield to protect the property’s original owner, ensuring that the illegal or unlawful possessor is compensated. Mesne profits are a type of compensation that allows the aggrieved party to seek redress while preventing the unlawful possessor from profiting from the property. The purpose of this article is to explain the notion of mesne profits, which is governed by the 1908 Code of Civil Procedure.
Meaning
The expression “Mesne Profits” has been defined under section 2(12) of the Code of Civil Procedure, 1908 as under:
“Mesne profits” of property means those profits which the person in wrongful possession of such property actually received or might with ordinary diligence have received there from, together with interest on such profits but shall not include profits due to improvements made by the person in wrongful possession.
Therefore, mesne profits are those to which a person is entitled but from which the defendant has kept him out. Mesne profits can only be claimed on immovable property, not on property that isn’t deemed to be immovable. Mesne profits of property also comprise profits that the person in wrongful possession of such property received or could have received with ordinary effort, as well as interest on such profits.
However, it was held in Shambhu Dayal Khetan v. Motilal Murarka[i]that the possession of a co-sharer can never be wrongful within the meaning of section 2(12) as he has a right and interest in every inch of the undivided property. Therefore, one co-sharer cannot claim mesne profits against the other, on the ground that the latter was in wrongful possession.
Object behind awarding such Profits
The main object is to compensate the person entitled to be in possession of the property. A person who is entitled to actual possession can claim “Mesne profits”. The very foundation for the cause-of-action for “Mesne profits” is wrongful possession of the defendant. Thus, for example, the possession of a mortgagor after the date of a foreclosure decree against him is a wrongful possession.
Against whom Mesne Profits can be claimed
An individual becomes liable for mesne profit when he or she possess and enjoy the benefits derived from an immovable property that doesn’t belong to him or her legally.[ii] They could be:
Tenants- If the tenant refuses to leave even after a service of notice to vacate the property.
Trespassers[iii]
Mortgagor- If the mortgagor continues to possess the mortgaged property after a decree for foreclosure was passed against them.
Mortgagee- If the mortgagee is still in possession of the property after a decree of redemption.
Any other person against whom a decree of possession has been passed[iv].
However, in a case where the plaintiff is dispossessed by several persons, then every single one of them will be held liable to pay mesne profits to the plaintiff, irrespective of whether they are in actual possession or have received any kind of benefits through the property.
The court may hold the trespassers jointly liable and have their respective rights plead in a separate suit for contribution and ascertain the liability of each of them[v].
For example, ‘A’ owns a farmhouse. ‘B’, ‘C’, ‘D’ & ‘E’ wrongfully claimed the possession of that farmhouse and makes some profits with only ‘C’ actually living on the premises. This has deprived ‘A’ of his right to enjoy the said property, so ‘A’ is entitled to bring forth a suit for recovery of possession and a claim for mesne profits against all four of them.
Another example, ‘K’ owns a house and ‘M’ claims the possession of the said house and starts collecting rents. This will be considered as Mesne Profits. After some time, ‘M’ builds more rooms and rent them out to be converted into a guest house. The profits that will arise from this improvement are not Mesne Profits.
Measure/Calculation of Mesne Profits
The measure/calculation of ‘mesne profits’ is not what the plaintiff has lost. The measure/calculation would be what the defendant has gained by the wrongful possession, or what he might reasonably have gained by such possession. Thus, if the person charged has left the land to another, the rent which he has actually received would be liable unless it is proved that a higher rent could have been obtained with due diligence. The principles which would guide the Court in determining whether mesne profits be allowed or not, are as follows:-
(i) wrongful possession should not make profit by his possession;
(ii) restoration of status before dispossession of the rightful owner; and
(iii) use to which the rightful owner would have put the land if he was himself in possession.
Thus, where the tenant fails to deliver the possession of the premises to the landlord on the expiry of his lease, his liability is that of a trespasser and if the property is not controlled by the Rent Act, the landlord is entitled to mesne profits.
In Nandita Bose v. Ratan Lal[vi] it was held that–
“The claim for Mesne profits damages is neither palpably absurd not imaginary. It needs judicial consideration. The acceptance of the view put forward by the respondent (tenant) may lead to encouraging a tenant who has forfeited his right to tenancy to carry on a directory litigation without compensating the land lady (landlord) suitably for loss suffered by him on account of the unreasonable deprivation of the possession of his premises for a long period until he is able to get possession of the premises through the court.”
In Lucy Kochuvareed v. P. Mariappa[vii], it was observed by the Supreme Court that, mesne profit is in the nature of damages, no invariable rule governing their award and assessment in every case, can be laid down and “the court may mould it according to the justice of the case”. Even so, one broad basic principle governing the liability for mesne profits is discernible from section 2(12) of the Code of Civil Procedure, 1908 which defines ‘mesne profits’ to mean “those profits which the person in wrongful possession of property actually received or might with ordinance diligence have received therefrom, together with interest on such profits, but shall not include profits due to improvements made by the person in wrongful possession”. From a plain reading of this definition, it is clear that wrongful possession of the defendant is the very essence of a claim for mesne profits and the very foundation of the defendant’s liability to pay mesne profits goes with actual possession of the land. That is to say, generally, the person in wrongful possession and enjoyment of the immoveable property is liable for mesne profits. But, where the plaintiff’s dispossession, or, his being kept or concerted act of several persons, each of them who participates in the commission of that act would be liable for mesne profits even though he was not in actual possession and the profits were received not by him but by some of his confederates.
In such a case where the claim for mesne profits is against several trespassers who combined to keep the plaintiff out of possession, it is open to the court to adopt either of the two courses: It may by its decree hold all such trespassers jointly and severally liable for mesne profits, leaving them to have their respective rights adjusted in a separate suit for contribution; or, it may, if there is proper material before it, ascertain and apportion the liability of each of them on a proper application made by the defendant during the same proceedings.
In Amina Beevi v. Thachi[viii],it was held that in any suit regarding rights of a tenant, the rights of tenant including a question whether a person is a tenant will have to be referred by civil court to the Land Tribunal and after the Land Tribunal decides the question, the civil court will decide the suit in accordance with the decision of the Land Tribunal. Thus the suit of the plaintiffs-respondents for declaration that they were tenants in respect of the suit property and for recovery of possession of the suit property from the defendants and for mesne profit was not barred either expressly or impliedly.
Interest and Deductions of Mesne Profits
The Civil Procedure Code has specified in Section 2 Clause 12, that mesne profits must include interests received during the wrongful possession. As there is no fixed rate of interest, it solely depends upon the court to determine the rate after taking all necessary information into account. However, there is a limitation that says it should not exceed 6% per annum.
While computing mesne profits, some deductions have to be made from the gross profit of the defendant in wrongful possession of the property, these deductions are:-
- Costs of cultivation and reaping the crops,
- Government revenue, Ceases.
- Charges for collecting rent, etc.
Burden of Proof
According to the law, in a suit for Mesne Profits, the burden of proof lies upon the claimant. The plaintiff is required to prove that he is the lawful owner of the property and he is being deprived of his right to enjoy it by the wrongful possession of the defendant.
Only after the ownership and deprivation of rights of the plaintiff are established, he can claim for mesne profits. And the plaintiff also has to prove what profits he might have received with ordinary diligence[ix].
Power of Court in Suit Relating Mesne Profits
According to Order 20 Rule 12 Code of Civil Procedure, whenever there is a suit for the recovery of possession, the court has the discretion of passing a decree
- For Possession of immovable property.
- For Collection of mesne profits or directing an inquiry for the same.
- A preliminary decree directing inquiry about mesne profits acquired before the suit was instituted; or
- Directing an inquiry as to mesne profits acquired until the possession is returned, or relinquished, and before 3 years from the decree.
Conclusion
Mesne Profits was created with the goal of protecting the rights of the rightful property owner while also holding the wrongful possessor accountable by compensating the owner. However, unless the claim is for immovable property alone and the plaintiff has made an explicit demand for it, a court cannot issue a decree for mesne profits. It’s also worth noting that, because mesne profits are a type of damage, the right to sue for them is the same as the right to suit for damages. Under Section 60 of the Code of Civil Procedure, the right cannot be attached or sold in the execution of a decree against the person who is entitled to the decree.
[i]Shambhu Dayal Khetan v. Motilal Murarka AIR 1980 Pat 106.
[ii] Chittoori v. Kudappa, AIR 1965 SC 1325.
[iii] Sita Ram Lakshmanji v/s Dipnarain Mandal, AIR 1977 SC 1870.
[iv] Prabhakaran & Ors vs M. Azhagiri Pillai, AIR 2006 SC 1567.
[v] Lucy Kochuvareed Vs P. Mariappa Gounder And Ors, AIR 1979 SC 1214.
[vi]Nandita Bose v. Ratan Lal AIR 1987 SC 1947.
[vii]Lucy Kochuvareed v. P. Mariappa, AIR 1979 SC 1214.
[viii]Amina Beevi v. Thachi AIR 2011 SC 244.
[ix] Ramakka Vs V. Nagesam, AIR 1925 Mad 145.