Jagdish Prasad Gyaniram Agarwal vs Uttamchand Alias Mohanlal ...
2002 Latest Caselaw 405 Bom

JUDGMENT

F.I. Rebello, J.

1. Rule. Respondents waive service.

2. Heard forthwith. The petitioner herein was the tenant of the respondent-landlord. The suit was filed for eviction of the petitioner on various grounds as available under the provisions of the Bombay Rents, Hotel and Lodging House Rates Control Act (57 of 1947) (hereinafter referred to as the said Act). The trial Court framed issues for determination and by an order dated 12-8-1997, decreed the suit in so far as the grounds of change of user, alternative accommodation as also reasonable and bona fide requirement and held that greater hardship will be caused to the respondent landlord than to the petitioner.

Aggrieved by the said order, the petitioner preferred an appeal being Civil Appeal No. 995 of 1997. The respondent herein filed cross-objections in so far as rejection of the ground of arrears of rent. The appeal and cross-objections were heard together and by an order dated 21-12-2001 the appeal preferred by the petitioner was dismissed and the order directing eviction was confirmed. The Appellate Court ordered eviction on the following grounds:-

(1) That the petitioner herein was a defaulter in payment of rent;

(2) That the petitioner has changed the user of the suit premises and further held under point No. 3, that the petitioner had not used the suit premises for a continuous period of six months prior to the filing of the suit without any reasonable cause and proceeded to hold that even if assuming that the premises were given for godown, yet they were being used for the purpose of business.

(3) In so far as the point on reasonable and bona fide requirement and hardship is concerned, the Appellate Court answered the point in favour of the respondent, in so far as the test of hardship is concerned, however, it held in favour of the petitioner.

3. Considering the controversy involved the petition can be disposed off by considering the issue by arrears of rent.

A few relevant facts for the disposal of the petition on the issue of arrears of rent can now be set out. The statutory notice was served by the respondent on the petitioner on 26-10-1992. The same was received on 9-11-1992. The suit was filed on 7-4-1993. Even prior to filing of the suit, the petitioner has filed an application for fixation of standard rent on 7-12-1992 i.e. within one month of the receipt of the statutory notice, interim rent was fixed at Rs. 40/- by an order dated 7-10-1994. The application for fixation of standard rent was disposed off on 30-10-1995 by fixing the standard rent at Rs. 60/- p.m.

The petitioner preferred an appeal against the order passed in standard rent application being Application No. 316 of 1992. On 26-10-1994, petitioner deposited rent for 229 months at the rate of Rs. 40/- per month, total an amount of Rs. 9,280/-. Similarly, on 29-12-1994, for a period from 1-1-1995 to 31-12-1995, deposited an amount of Rs. 480/- being the advance rent for 12 months. So also on 8-1-1996, a sum of Rs. 5,600/- was deposited being the difference between the interim standard rent and the standard rent as fixed finally. No date was fixed for setting the issues. But, record of evidence commenced on 7-9-1996 and that has been held to be the first date of hearing. Similarly, the petitioner deposited a sum of Rs. 720/- being the advance rent for the period 1-1-1996 to 31-12-1996 as also advance in the sum of Rs. 360/- each has been paid in December, 1996 on 1-1-1997 for the period up to 1-1-997 to 30-6-1997 and from 1-7-1997 to 31-12-1997. The judgment was delivered by the trial Court on 12-8-1997.

It is the case of the respondent that the rent dues from 1-9-1975 to 1-10-1994 for 229 months at the rate of Rs. 60/- p.m. were amounting to Rs. 13,740/-. The rent for the period from 1-10-1994 to 31-8-1996 worked out to Rs. 1,380/-. The interest from 1-9-1975 to 1-10-1994 at 9% p.a. on the above amount for the said period worked out to Rs. 11,851.00. Therefore, even though the rent may have been deposited, the interest had not been deposited. Consequently, the benefit of section 12(3) of the Act was not available to the petitioner.

4. The limited issue therefore is whether the petitioner is entitled to the benefit under section 12(3) of the Rent Act.

At the hearing of the petition, on behalf of the petitioner, learned Counsel contends that a co-joint reading of section 12(1) and (3) of the Act read with the explanation would indicate that when the standard rent application had been filed by the petitioner within the time contemplated, that would mean readiness and willingness of the tenant to pay the rent. If that be the case, it is contended that the ground of eviction for non-payment of rent itself will not subsist. Considering that the tenant has paid the arrears of rent, no order for eviction could have been passed. Learned Counsel for the petitioner has placed reliance on the judgment of the Apex Court in the case of Shah Dhansukhlal Chhaganlal, Appellant v. Dalichand Virchand Shroff (dead) by his Legal Representative, Respondents, .

On the other hand, on behalf of the respondent, it is contended that even though the rent has been paid, the petitioner could not avoid eviction only on the ground that they had paid the standard rent. Along with that, petitioner had also to pay interest as contemplated by sub-section (3) of section 12. Admittedly, interest has not been paid as and up to the first date of hearing and in these circumstances, the benefit contemplated by the proviso to sub-section (3) was not available and eviction had to follow.

5. Section 12(1) of the Act provides amongst others that as long as the tenant is ready and willing to pay the standard rent and the permitted increases, the landlord shall not be entitled to recovery of possession. Explanation (1) contemplates that if there be any dispute as to the amount of standard rent or permitted increases, recoverable under the Act, the tenant shall be deemed to be ready to pay such amount before the expiry of one month after notice preferred under sub-section (2), the tenant makes an application under sub-section (3) of section 11 and thereafter pays or tenders the amount of rent or permitted increases specified in the order made by the Court.

The Apex Court in the case of Shah Chhanganlal (supra) was considering the issue of a suit for eviction filed on the ground that the tenant was in arrears for a period of more than six months. The tenant although raising a dispute as to the standard rent or permitted increases recoverable under the Act, make no application in terms of section 11(3) then he could not claim protection under section 12(1), by merely offering to pay or even pay all arrears due from him when the Court is about to pass a decree at his instance. The Apex Court thereafter noted that to be within the purview of sub-section (1) where the tenant raises a dispute about the standard rent payable, he must make an application to the Court under sub-section (3) of section 11 and thereafter, tender the amount of rent and the permitted increases if specified in the order made by the Court.

Section 12(2) contemplates the question of a statutory notice before a suit can be filed section 12(3) refers to the order for eviction subject to the provision that the tenant would be entitled to that benefit if he had earlier availed of the benefit on the previous occasion.

Learned Counsel for the petitioner in aid of his contention has also relied on the judgment in the case of Jaypal Bandu Adke and another, Petitioners v. Basavali Gurulingappa and another, Respondents, , in the case of Mohamed Yusufkhan Gulzarkhan, Petitioner v. Mogalbeg Durbeg and others, Respondents, and in the judgment of Kalandarali Akbarali Kazi, Petitioner v. Shaikh Gulam Ibrahim, Respondent, . All the judgments were based on section 12(3) as it stood before its substitution by section 12(3) in the year 1987. Those judgments in my opinion would therefore, be of no assistance in construing section 12(3) as substituted.

6. Section 12(3) requires a tenant in order to avoid forfeiture to on or before the first date of hearing to pay or tender the amount of rent in Court or tenders in Court the standard rent and the permitted increases together with simple interest on the amount of arrears and permitted increases at the rate of 9% p.a. The second part contemplates that thereafter such tenant continues to pay or tender in Court regularly, such standard rent and the permitted increases till the suit is finally decided and also to pay costs as directed by the Court. The limited issue is whether the tenant having paid the standard rent, was he bound to pay the interest on the standard rent

Is a tenant who has applied under section 11 for fixation of standard rent absolved from payment of interest as contemplated by section 12(3)? To my mind, the answer is no. What section 12(3) contemplates is payment of standard rent and interest thereon at 9% p.a. Two situations can arise. The first would be when the standard rent application was already filed even before the notice under section 12(3). We are not concerned with the first situation. The second situation is when the tenant applies for determination of standard rent, after the statutory notice. There is contractual rent which the tenant does not accept as the standard rent. Therefore, he applies under section 11 for fixation of standard rent. In other words, till such time as the standard rent is fixed and the order is passed by the Court, for payment of interim rent, the contractual rent continues to be in the hands of the tenant. The fixation of standard rent would only mean rent which is due and payable. All the time, the amount is lying with the tenant. The interest payable will be computed on standard rent and not on contractual rent. Therefore, at the most if the rent is in the hands of the tenant, the interest payable by him would be payable on standard rent as determined. Once that be the case, to take the benefit of the proviso under section 12(3), the tenant must not only pay the rent but, also the interest. In the instant case, interest has not been paid. Section 12(3) does not absolve the tenant to pay interest. Once the tenant is in default of standard rent even if on service of statutory notice, the tenant's applies for fixation of standard rent, the tenant is by virtue of the statutory provision is bound to pay interest either on the admitted standard rent or standard rent as and when determined. The payment or deposit must be on or before the first date of hearing and/or on the date the Court may extend to pay rent and interest.

7. In the light of that, in the instant case, I find no merit in the case of the petitioner on the ground of arrears of rent. Once that be the case, it is not necessary to go into the other grounds of eviction. Rule discharged. There shall be no order as to costs.

Learned Counsel for the petitioner applies for stay. Application for stay rejected. However, in the event the petitioner and other adult members residing in the premises file usual undertaking in this Court within four weeks, respondents not to take steps to execute the decree up to 31-12-2002.