Code of Civil Procedure, 1908 (CPC)
Decree for Mesne Profits under the CPC: Meaning, Measure and Procedure
A person kept out of his property loses more than possession: he loses what the property would have earned him. Mesne profits are the law's answer, and the Code of Civil Procedure, 1908 deals with them in two places: Section 2(12) defines them, and Order XX Rule 12 provides the procedure by which they are decreed. These notes cover the definition and its four elements, who is liable and for what period, the measure and mode of assessment, the division between past and future profits, and the execution of a mesne profits decree.
1. The Definition: Section 2(12)
§ Section 2(12), CPC 1908 “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 therefrom, together with interest on such profits, but shall not include profits due to improvements made by the person in wrongful possession. |
§ The four elements of the definition Each is separately examinable, and a complete answer names all four: • Wrongful possession. Liability attaches only to a person in wrongful possession. A person in lawful possession, however unprofitable his occupation is to the owner, owes no mesne profits; a tenant holding over after the lease determines, a trespasser, and a purchaser under a sale later set aside are all in wrongful possession. • Actually received, or might with ordinary diligence have received. The measure is not confined to what was in fact earned. A wrongful possessor who lets the property lie idle is charged with what a person of ordinary diligence would have earned from it, so deliberate under-exploitation is no defence. • Together with interest on such profits. Interest is an integral part of mesne profits and not a separate claim; it runs on the profits as they accrue and is awarded at a rate the court considers reasonable. • Excluding profits due to improvements. Profits attributable to improvements made by the person in wrongful possession are excluded, since the owner should not profit from another's expenditure. The exclusion is confined to the increase attributable to the improvement, not the whole of the profits. |
2. Who is Liable, and for What Period
i. The person in wrongful possession. Liability rests on wrongful possession, so it attaches to a trespasser, a tenant holding over, a licensee after revocation, or a co-owner who excludes the others from the common property.
ii. Joint trespassers. Where several persons are jointly in wrongful possession, they are jointly and severally liable, and a decree may be passed against them together, the plaintiff recovering the whole from any of them.
iii. The period. Liability runs from the date possession became wrongful until possession is delivered to the person entitled, subject to the limits Order XX Rule 12 imposes on the decree and to the law of limitation, which under Article 51 of the Limitation Act, 1963 allows three years for a claim to mesne profits, running from the date when the profits are received.
iv. Transferees. A person who takes possession from a wrongful possessor, and whose own possession is wrongful as against the true owner, is himself liable for the period of his possession, though not for his predecessor's.
3. Past and Future Mesne Profits
Order XX Rule 12 in the scheme of decrees that require an inquiry
Basis | Past mesne profits | Future mesne profits |
|---|---|---|
Period covered | From the date possession became wrongful until the institution of the suit | From the institution of the suit until delivery of possession, or three years from the decree, whichever is earlier |
How claimed | Must be specifically claimed in the plaint, valued, and court fee paid on the amount claimed | Claimed as a prayer for an inquiry; no precise figure is required at the plaint stage |
How determined | Proved at the trial, or by an inquiry the decree directs under Order XX Rule 12(1)(b) | By an inquiry directed under Order XX Rule 12(1)(c), followed by a final decree under sub-rule (2) |
Limitation | Governed by Article 51 of the Limitation Act, 1963: three years from when the profits were received | No separate limitation, the claim being part of the decree in the pending suit |
Effect of omission | A claim omitted from the plaint is barred by Order II Rule 2 unless leave was obtained | The court may in an appropriate case still direct an inquiry, the claim arising after the suit was filed |
4. The Measure and Mode of Assessment
The court's task is to ascertain what the property would have yielded in the hands of a person of ordinary diligence. The material varies with the property.
i. Rented property. The rent actually received, or the fair rental value where the property was not let, is the usual measure, and comparable lettings in the locality furnish the evidence.
ii. Agricultural land. The produce the land would have yielded, valued at prevailing prices, less the costs of cultivation, the calculation ordinarily being made through a commission under Order XXVI.
iii. Business premises. The letting value is the normal measure. Profits the wrongful possessor made from his own business conducted on the premises are not mesne profits of the property, since they flow from his labour and capital rather than from the land.
iv. Interest. Awarded on the profits as an integral part of the claim, at a rate the court considers reasonable in the circumstances.
v. Improvements. Profits attributable to improvements made by the person in wrongful possession are excluded, and the burden of establishing the attribution lies on him.
§ The commission as the usual instrument Mesne profits are rarely capable of proof by simple evidence: they require accounts, local values, cropping patterns or comparable rents. Section 75 with Order XXVI Rule 9 allows the court to issue a commission for a local investigation, and Order XXVI Rule 11 for an examination of accounts. The commissioner's report is not conclusive: it is evidence in the suit, and the parties may object to it, the court reaching its own conclusion under Order XXVI Rule 10. |
5. Procedure: Order XX Rule 12 and the Final Decree
The procedure follows the structure examined in the companion topic on possession decrees. The decree under Rule 12(1) grants possession, deals with past profits, and directs an inquiry into future profits. The decree is therefore final as to possession and preliminary as to mesne profits. After the inquiry, Rule 12(2) requires a final decree in accordance with its result, and only then is the mesne profits claim executable. Two consequences follow for the decree-holder: he may execute the possession part immediately, and he must apply for the final decree once the inquiry is complete, since the preliminary decree alone gives him nothing to execute on that head.
§ The three-year ceiling and what lies beyond it Clause (c) of Rule 12(1) limits the inquiry into future profits to the period ending on delivery of possession or three years from the date of the decree, whichever occurs first. The limit exists because a court cannot decree indefinitely into the future for a period whose length depends on the judgment-debtor's own resistance. Where possession is not delivered within three years, the decree-holder's remedy for the subsequent period is a fresh suit for mesne profits. This is one of the few situations in which the Code contemplates a second suit on what is in substance the same grievance, and the reason is that the later cause of action, wrongful possession after the three-year period, had not arisen when the first suit was decreed. |
6. Landmark Points on Mesne Profits
- Section 2(12) CPC. The four elements: wrongful possession; what was actually received or might with ordinary diligence have been received; interest on those profits; and the exclusion of profits due to improvements.
- Order XX Rule 12(1) and (2). Past profits may be decreed or inquired into; future profits are the subject of an inquiry limited to delivery of possession or three years from the decree, followed by a final decree.
- Article 51, Limitation Act, 1963. Three years for a suit for mesne profits, running from when the profits are received.
- Section 75 with Order XXVI Rules 9 to 11. Commissions for local investigation and examination of accounts, the usual instruments for assessing mesne profits.
- Order II Rule 2. A claim to past mesne profits omitted from the plaint without leave cannot be pursued in a later suit, the cause of action being the same.
7. Frequently Asked Questions on Mesne Profits
What are mesne profits under the CPC?
Under Section 2(12), the profits which a person in wrongful possession of property actually received, or might with ordinary diligence have received, from it, together with interest on those profits, but excluding profits due to improvements made by that person.
Who is liable to pay mesne profits?
The person in wrongful possession, such as a trespasser, a tenant holding over after the lease determines, a licensee after revocation, or a co-owner who excludes the others. Joint wrongful possessors are jointly and severally liable.
Are mesne profits limited to what the possessor actually earned?
No. The measure is what he actually received or might with ordinary diligence have received, so a wrongful possessor who leaves the property idle is charged with what a person of ordinary diligence would have earned from it.
Is interest part of mesne profits?
Yes. Section 2(12) includes interest on the profits within the definition itself, so it is an integral component of the claim and not a separate head of relief.
What is the difference between past and future mesne profits?
Past mesne profits accrue before the institution of the suit and must be specifically claimed and valued in the plaint. Future mesne profits run from the institution of the suit until delivery of possession or three years from the decree, and are determined by an inquiry directed by the decree, followed by a final decree under Order XX Rule 12(2).
For how long can future mesne profits be awarded?
Until delivery of possession to the decree-holder or the expiration of three years from the date of the decree, whichever occurs first. For any period beyond that, the decree-holder must institute a fresh suit.
How are mesne profits assessed?
By reference to what the property would have yielded in the hands of a person of ordinary diligence: the rent received or the fair rental value for let property, the produce less costs of cultivation for agricultural land, and the letting value for business premises. Courts commonly appoint a commissioner under Order XXVI to investigate or examine accounts.
8. Related Topics in This CPC Series
- Decree in a Suit for Possession under Order XX Rule 12
- Section 33 and Order XX: Judgment and Decree
- Important Definitions under Section 2 CPC
- Order II: Frame of Suit and the Bar under Order II Rule 2