Play Games 24X7 Pvt. Ltd. Vs Loran Leasing And Infotech Pvt. Ltd.; Interim Application No. 655 of 2023
The High Court of Judicature at Bombay recently delivered a judgement in the matter of Play Games 24X7 Pvt. Ltd. (the Plaintiff) and Loran Leasing And Infotech Pvt. Ltd. (the Defendant).
This case involved a dispute between the Plaintiff and the Defendant, over the termination of a Leave and License Agreement (LLA) for a commercial property. One of the key issues in the case was whether the Defendant was entitled to retain the security deposit paid by the Plaintiff. The Defendant claimed that they were entitled to do so, as the Plaintiff had wrongfully occupied the licensed premises beyond the term of the LLA. Therefore, forming the main issue of this case i.e., whether a tenant can claim damages and compensation from the landlord in their own suit as a defence to the admitted liability of refunding the security deposit.
The Hon’ble Court held that the defendant cannot claim damages and compensation from the plaintiff in their own suit as a defence to the admitted liability of refunding the security deposit. The court cited the Supreme Court’s decision in Union of India v/s Raman Iron Foundry, wherein it was held that when there is a breach of contract, the party who commits the breach does not so instantly incur any pecuniary obligation, nor does the party complaining of the breach becomes entitled to a debt due from the other party. The only right which the party aggrieved by the breach of the contract has is the right to sue for damages.
The Hon’ble Court also held that the defendant is entitled to retain the security deposit and claim compensation for wrongful occupation of the licensed premises. However, this does not absolve them of their liability to refund the security deposit to the plaintiff. The defendant can only set off any sum found due and payable to the plaintiff in their own suit.

Author of this article:
Adv. Ravish Bhatt,
Partner, R&D Law Chambers,
Dual Qualified Lawyer Solicitor | International Tax Affiliate

Connect with Mr. Bhatt on Linkedin: https://www.linkedin.com/in/adit-ravishbhatt/

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