Introduction:

In a significant ruling concerning landlord-tenant disputes and procedural fairness under the Code of Civil Procedure, 1908, the Supreme Court in Dharmendra Kalra & Ors. v. Kulvinder Singh Bhatia [2026 LiveLaw (SC) 509] reiterated that the drastic power of striking off a tenant’s defence under Order XV Rule 5 CPC cannot be exercised mechanically or prematurely. The Court emphasized that before depriving a tenant of the right to contest eviction proceedings, the trial court must first determine the “first date of hearing,” ensure proper service of notice, and examine whether the alleged default in rent payment was wilful or bona fide.

The judgment was delivered by a Bench comprising Justice S.V.N. Bhatti and Justice Prasanna B. Varale. The Court observed that striking off a defence is a serious judicial consequence and cannot be invoked merely because there has been some delay or dispute regarding rent deposits. The Bench underscored that courts are required to balance procedural discipline with principles of natural justice and fairness.

The litigation arose out of a tenancy dispute relating to two halls where the respondent-tenant was running a business under the name “Gyan Vaisnav Hotel.” According to the landlords, the monthly rent had been revised to Rs. 25,000 in September 2020. It was alleged that despite the enhancement, the tenant failed to pay rent from November 2020 onwards, thereby committing default.

The landlords subsequently issued a notice terminating the tenancy under Section 106 of the Transfer of Property Act, 1882. After termination of tenancy, they instituted proceedings before the Small Causes Court seeking eviction of the tenant and recovery of arrears of rent.

During the pendency of the eviction proceedings, the landlords filed an application under Order XV Rule 5 CPC seeking striking off of the tenant’s defence on the ground that the tenant had failed to deposit the admitted rent during the course of the suit. The Trial Court accepted the landlords’ plea and, by order dated August 5, 2023, struck off the tenant’s defence.

Aggrieved by the Trial Court’s order, the tenant approached the High Court through a revision petition. The High Court partly allowed the tenant’s plea and directed deposit of rent at the rate of Rs. 1,500 per month instead of Rs. 25,000 per month as claimed by the landlords. The High Court also warned that failure to comply with the direction would result in the defence being struck off. However, despite subsequent default by the tenant, the High Court later granted further extension of time for compliance on the ground that the tenant’s local counsel had gone abroad.

The landlords, dissatisfied with the indulgence shown to the tenant and the modification of the Trial Court’s order, approached the Supreme Court. The matter thus required the Court to examine the scope and manner of exercise of powers under Order XV Rule 5 CPC and the safeguards that must accompany such exercise.

The ruling is important because it clarifies that procedural provisions intended to discipline litigants cannot be transformed into tools for automatic punishment. The judgment strengthens the principle that even in rent control and tenancy disputes, procedural fairness and judicial scrutiny remain indispensable.

Arguments of the Parties:

The petitioners-landlords argued that the respondent-tenant had consistently defaulted in payment of rent despite repeated demands and legal notice. According to them, the tenancy had been validly terminated under Section 106 of the Transfer of Property Act after the tenant failed to pay rent from November 2020 onwards. They contended that the respondent had deliberately prolonged the litigation while continuing to enjoy possession of the premises without honouring contractual obligations.

The landlords further submitted that Order XV Rule 5 CPC imposes a mandatory obligation upon the tenant to deposit admitted rent during the pendency of eviction proceedings. It was argued that failure to comply with this statutory requirement entitled the court to strike off the tenant’s defence. According to the petitioners, the Trial Court had rightly exercised its jurisdiction after finding that the tenant had failed to deposit rent within the prescribed time.

The petitioners also challenged the approach adopted by the High Court. They argued that the High Court erred in reducing the amount of rent to Rs. 1,500 per month despite clear assertions regarding enhancement of rent to Rs. 25,000 per month. It was contended that the High Court’s interference diluted the mandatory nature of Order XV Rule 5 CPC and effectively rewarded the tenant’s continued default.

The landlords particularly objected to the High Court granting repeated extensions of time to the tenant. According to them, once the High Court had imposed a conditional direction requiring deposit within a stipulated period, the subsequent extension granted merely because the tenant’s local counsel had travelled abroad amounted to unwarranted judicial indulgence. The petitioners argued that such repeated relaxations defeated the very purpose of Order XV Rule 5 CPC, which is intended to prevent tenants from abusing the judicial process while withholding rent.

On the other hand, the respondent-tenant contended that the orders passed by the Trial Court were legally unsustainable because the mandatory foundational requirements for invoking Order XV Rule 5 CPC had not been fulfilled. The tenant argued that the Trial Court struck off the defence at a preliminary stage without first determining the legally relevant “first date of hearing.”

The respondent submitted that under settled legal principles, the “first date of hearing” is not every procedural date fixed in the suit but the date on which the court actually applies its mind to the controversy involved in the proceedings. According to the tenant, unless such a date is conclusively determined, the obligation under Order XV Rule 5 CPC cannot be rigidly enforced.

The tenant further argued that issues relating to proper service of summons and adequate opportunity to contest the proceedings had not been properly examined by the Trial Court. It was submitted that the drastic consequence of striking off a defence cannot be imposed without ensuring compliance with principles of natural justice.

The respondent also contended that there had been substantial compliance with the requirements of law and that any delay or irregularity in deposit was neither deliberate nor contumacious. The tenant argued that the court must distinguish between wilful default and bona fide inability or procedural confusion. According to the respondent, striking off the defence without examining the nature and reasons for default amounted to denial of a fair opportunity to defend the eviction proceedings.

The tenant further supported the High Court’s exercise of discretion in granting extension of time. It was argued that procedural rules are intended to advance justice and not to punish parties for technical lapses. The respondent maintained that the High Court had acted within its jurisdiction in balancing equities between the parties.

The rival submissions thus required the Supreme Court to determine the true scope of Order XV Rule 5 CPC, the meaning of the “first date of hearing,” and the extent to which courts can exercise discretion while dealing with defaults in rent deposits during pendency of eviction suits.

Court’s Judgment:

The Supreme Court set aside the orders passed by both the Trial Court and the High Court and remitted the matter back to the Trial Court for fresh consideration. The judgment authored by Justice Prasanna B. Varale laid considerable emphasis on the procedural safeguards embedded within Order XV Rule 5 CPC and the need for cautious exercise of the power to strike off a tenant’s defence.

At the outset, the Court observed that striking off a defence is not an ordinary procedural step but a serious judicial action that deprives a party of the right to contest the case on merits. Therefore, such power cannot be exercised mechanically merely because there has been some delay or deficiency in rent deposit.

The Bench clarified that Order XV Rule 5 CPC, although couched in mandatory language, does not compel courts to automatically strike off the defence in every case of default. Instead, the provision must be interpreted in a manner consistent with principles of fairness, proportionality, and natural justice.

One of the central issues addressed by the Court was the meaning of the expression “first date of hearing.” The Court observed that this phrase has a specific legal significance and cannot be confused with routine procedural dates fixed for filing documents, service of notice, or completion of formalities.

According to the Court, the “first date of hearing” refers to the stage when the court proposes to apply its judicial mind to the controversy involved in the suit. Unless such a date is clearly identified and determined, the foundation for invoking Order XV Rule 5 CPC remains uncertain.

The Court found that in the present case, the Trial Court had failed to conclusively determine the first date of hearing before proceeding to strike off the tenant’s defence. This omission, according to the Bench, went to the root of the matter because the tenant’s obligation to deposit rent under the provision is linked to the determination of such a date.

The Supreme Court further held that before invoking the drastic consequences contemplated under Order XV Rule 5 CPC, the court must also ensure proper service of notice and adequate opportunity of hearing to the tenant. The Bench observed that procedural fairness is an essential component of judicial adjudication, particularly when the result may deprive a litigant of the opportunity to contest the proceedings.

Importantly, the Court stressed that courts must examine whether the alleged default is wilful, deliberate, or contumacious. It held that minor procedural lapses or bona fide defaults should not automatically result in striking off the defence. The Bench emphasized that substantial compliance with the statutory requirement may, in appropriate cases, be sufficient to protect the tenant’s right to contest the suit.

The Court made an important observation that the purpose of Order XV Rule 5 CPC is to prevent abuse of judicial process by tenants who continue to occupy premises without paying rent during pendency of litigation. However, the provision is not intended to become a weapon for automatic eviction or denial of fair hearing.

The Supreme Court also expressed dissatisfaction with the manner in which the High Court dealt with the matter. While acknowledging that the High Court initially imposed conditions regarding deposit of rent, the Bench found inconsistency in the subsequent extension of time granted to the tenant.

The Court observed that once a conditional order is passed requiring compliance within a specified period, any relaxation or extension must be supported by cogent reasons and careful judicial consideration. Granting repeated indulgence without reconciling it with the earlier conditional direction created uncertainty and undermined procedural discipline.

Nevertheless, instead of deciding the issue finally, the Supreme Court considered it appropriate to remit the matter to the Trial Court for fresh adjudication. The Bench directed the Trial Court to reconsider the application under Order XV Rule 5 CPC after addressing all foundational aspects.

The Court specifically directed the Trial Court to determine the “first date of hearing” in accordance with law, examine whether there had been due or substantial compliance with the statutory requirements, consider whether the alleged default was wilful or bona fide, and thereafter pass a reasoned order after granting adequate opportunity to both parties.

The judgment thus reinforces the broader legal principle that procedural powers carrying severe consequences must always be exercised with caution and judicial sensitivity. The ruling also serves as a reminder that procedural law is ultimately intended to facilitate fair adjudication and cannot be reduced to a rigid mechanism for punishment.

By insisting upon careful scrutiny before striking off a tenant’s defence, the Supreme Court has strengthened procedural safeguards in landlord-tenant litigation and reaffirmed the importance of balancing statutory compliance with principles of justice and fairness.