Oral Statements Cannot Alter Written Lease Terms, Karnataka HC Sets Aside Commercial Court Decree

The Karnataka High Court has set aside a Commercial Court decree directing the return of a cable TV network business, equipment, and subscribers and ordering payment of rent and damages.

The court held that there was no evidence of any agreement extending a written lease beyond its stipulated term and that the claims were barred by limitation.

The dispute concerned a cable TV network business operated under the name “New Satellite Video Visions” in Mysuru.

A Division Bench of Chief Justice Vibhu Bakhru and Justice C.M. Poonacha allowed an appeal filed by M.J. Pradeep Kumar and others. The Bench set aside a September 4, 2025 judgment of the Commercial Court.

“There is no evidence of any agreement between the parties other than a statement made by PW1, which is denied by DW1, that the lease deed had been extended. We are unable to accept that there was any agreement between the parties for extension of the lease deed. It is also well settled under Section 92 of the Indian Evidence Act, 1872 that oral statements cannot be accepted as modifying the terms of a written agreement,” the Court ruled.

The case arose from a lease deed dated April 25, 2009. Under the agreement, Srinivasa Kantharaje Urs leased his cable TV business, equipment and subscriber network to Raghavendra Enterprises for a period of three years, from May 1, 2009 to April 30, 2012.

The lessees paid a refundable security deposit of ₹15 lakh and agreed to pay monthly rent of ₹35,000.

According to the plaintiff, the parties orally continued the arrangement after expiry of the lease. He claimed that rent was to be adjusted against the security deposit. He sought recovery of the business assets and subscribers, arrears of rent of ₹3.90 lakh and damages of ₹50,000 per month.

The High Court found that there was no document on record showing that the lease had been extended beyond April 2012. It held that the alleged oral agreement was unsupported by any contemporaneous material.

The Court also noted evidence showing that the control room from which the business operated had been shifted to the plaintiff's own residence. It found no evidence that the defendants were continuing to operate the business from that location when the suit was filed.

Rejecting the plaintiff's claim for rent, the bench ruled: “In this view, the plaintiff's action of claiming rent would not be sustainable. It is not disputed that the plaintiff's cause of action for recovering the assets, as well as demanding the transfer of the business would commence from the date of expiry of the term of the lease agreement. Thus, any action for recovery of the same would now be barred by limitation. Thus, the plaintiff's claim for the same is barred by limitation.”

The court further held that the Commercial Court had awarded damages of ₹50,000 per month without any evidence to support the quantum claimed.

“We also note that although the learned Commercial Court has awarded damages at the rate of ₹50,000/- per month, there is no evidence whatsoever on record which would substantiate the quantum of the damages allegedly suffered by the plaintiff,” the Bench observed.

It also noted that equipment handed over in 2009 would have “significantly depreciated in value” by now.

Holding that the suit was barred by limitation, the Court set aside the Commercial Court's judgment and decree and allowed the appeal.