Summary: Atma Ram Builders Pvt Ltd took Embassy Restaurant to court over rent disagreements for two properties in Connaught Place, New Delhi. The case, initially thrown out, was appealed and brought back for further proceedings.
Atma Ram Builders claimed they owned two properties in Connaught Place, New Delhi. The first property was rented to Embassy Restaurant since 1962, and the second since 1947. The rent was much lower than current market prices, leading to a legal fight.
On March 16, 2012, a Single Judge dismissed Atma Ram Builders' case, saying the Delhi Rent Control Act (DRC Act) applied. The court said the issue should be handled by the Rent Controller, not the civil court.
"The civil suit was held to be not maintainable."
On December 23, 2025, Justices Anil Kshetrapal and Harish Vaidyanathan Shankar listened to the appeal. Atma Ram Builders argued that because certain parts of the DRC Act were no longer valid, they deserved market rent. They wanted back payment and interest, arguing that the Rent Controller's authority was no longer relevant.
The main legal question was whether the civil court could decide on rent issues after parts of the DRC Act were no longer valid. The court looked at sections related to rent control and eviction, finally deciding that the civil court could handle this case.
"Whether Atma Ram Builders is entitled to market rent or only to an enhanced rent...is a matter that can be determined only upon adjudication after trial."
The appeal was allowed, and the previous judgment was canceled. The case was brought back for further trial to figure out the right rent, with the next hearing scheduled for January 15, 2026.
"The present Appeal is allowed. The Impugned Judgment is hereby set aside."
