Natwarlal Gokuldas Shah (Since ... vs Khanderao Balwant Lokhande ...
2002 Latest Caselaw 975 Bom

JUDGMENT

A.M. Khanwilkar, J.

1. This writ petition, under Article 227 of the Constitution of India, takes exception to the judgment and decree passed by the District Judge, Sangli dated 31st March 1987 in Civil Appeal No. 118 of 1982.

2. The premises in question consists of room admeasuring 40 x 10 sq.ft. in CTS No. 305, Pet Bhag, Sangli. The original petitioner Natwarlal Gokuldas Shah was inducted as a tenant in the suit premises some time in the year 1852. The respondent is the landlord. The Respondent instituted a suit for possession against the tenant on the ground of default and bonafide requirement in the year 1970, being RCS No. 19 of 1970. However, we are concerned only with the ground of default. The tenant contested the said suit. It was his case that annual rent in respect of the suit premises was only Rs. 150/- per annum and not as demanded by the landlord. The trial Court accepted that claim of the tenant. The trial court, however, found that the Respondent landlord was entitled to rent for a period of 6 years from 1965 to 1970 at the rate of Rs. 150/- per annum, whereas the tenant was entitled to credit of Rs. 1234-59 paid by him towards the taxes with regard to the suit premises to the Sangli Municipality and for further credit of amount of Rs. 1960/- deposited by the tenant in court from time to time. Accordingly, the trial Court by judgment and decree dated 22-4-1972 was pleased to dismiss the suit with costs. Against this decree the matter was carried in appeal by the landlord, being Civil Appeal No. 103 of 173, which was dismissed by the appellate Court. The landlord carried the matter to this Court by way of writ petition, which was also dismissed. Thereafter the tenant filed Misc. Application No. 585 of 1973 before the Civil Judge J.D., Sangli contending that he had paid Rs. 1234-59 to the Sangli Municipality for and on behalf of landlord; had deposited amount of Rs. 1960/- in court from time to time during the pendency of earlier proceedings between the parties; and also claimed costs of Rs. 180/- and Rs. 46-87 in suit and appeal respectively, therefore, prayed that after adjusting the amount of Rs. 1500/- payable by him towards rent from 1-1-1965 to 31-12-1974, he has entitled to recover balance amount of Rs. 1927-46 from the landlord. That application came to be dismissed on 17-6-1976. Against that decision the tenant carried the matter in appeal being Misc. Appeal No. 227 of 1975. That appeal was partly allowed by the Appellate Court on 17-6-1976, holding that the tenant was entitled to refund of Rs. 460/- out of Rs. 1960/- deposited in the Court but was not entitled to recover other amounts from the landlord. Suffice it to mention that the issue regarding adjustment of the amounts paid by the tenant towards deposit to the municipality and in court from time to time stood concluded by this order. The tenant on his understanding of this order, issued notice to the landlord on 15-11-1976 (Exh.20) calling upon the landlord to make certain adjustment and to pay the amount as indicated in the said notice, which according to the tenant, was due to him from the landlord. This notice was sent by the advocate for the tenant. In response to this notice the landlord through his Advocate, sent reply on 16-12-1976 (Exh.21), inter alia, denying that he was liable to pay any amount to the tenant or that the tenant was entitled for any adjustments as claimed in the notice dated 15-11-1976. Thereafter the landlord directly proceeded to institute suit for possession being Regular Civil Suit No. 377 of 1977, before the Civil Judge, J.D., Sangli on 9-8-1977 inter alia, on the ground of default. According to the landlord, the tenant was in arrears of rent from 17-6-1976. Besides, the landlord claimed possession also on the ground of reasonable and bonafide requirement. However, the ground of reasonable and bonafide requirement has not been pressed by the landlord at the later stage in appeal. This suit was resisted by the tenant. According to the tenant, no demand notice has been issued nor served by the landlord and, in absence of such a notice, the suit was barred by the provisions of Section 12(2) of by Bombay Rents, Hotel and Lodging House Rates (Control) Act, 1947 (hereinafter referred to as the Rent Act). It was next contended that even assuming that the landlord considered the reply Ex./21) dated 16-12-1976 to be the demand notice, that was not a valid demand notice within the meaning of Section 12(2) of Rent Act read with Section 106 of the Transfer of Property Act. Even for this reason the suit which was founded on that document purported to be demand notice was not maintainable. It was next contended on behalf of the tenant that he was not in arrears as alleged by the landlord and there was no question of decreeing the suit on the ground of default within meaning of Section 12 of the Rent Act. On the basis of the rival stand the trial Court proceeded to frame 8 issues, which included the issue of reasonable and bonafide requirement and greater hardship. However, as mentioned earlier we are not concerned with that issue but only the ground of default. In so far the issue of default is concerned, the trial Court accepted the stand taken by the tenant that there was no specific demand and the tenant was not aware about the period of default and the purported demand notice (Exh.21) was not a valid demand notice. The trial Court has adverted to other aspects of the matter and has answered the issue in favour of the tenant. Accordingly, the suit came to be dismissed by the trial court by judgment and decree dated 12-3-1982 - holding that the suit could not proceed against the tenant for want of valid demand notice and in any case, the tenant was not defaulter within the meaning of Section 12 of the Rent Act. Against this decision the matter was carried in appeal by the landlord being Civil Appeal No. 118 of 1982, before the District Court at Sangli. The District Court by the impugned judgment and decree dated 31st March 1987 has however, allowed the appeal confining the decree for possession on the ground of default, as can be discerned from para 5 of the impugned judgment. In fact, only ground of default was pressed into service on behalf of the landlord. The District Court has negatived the stand taken by the tenant and held that reply sent on behalf of the landlord to the tenant's Advocate (Exh.21) was in the nature of demand notice and there was substantial compliance of Section 12(2) of Rent Act. The Appellate Court has further found as a fact that the rent was neither payable monthly nor yearly, even then proceeded to hold that the case was covered by Section 12(3)(a) of the Rent Act. The Appellate Court then proceeded to examine the case in the context of requirement of Section 12(3)(b) of the Act and held that the tenant was defaulter within the meaning of the said provision. Accordingly, the appeal preferred by the landlord was allowed and the tenant was directed to hand over possession of the suit premises to the landlord. The present writ petition has been filed under Article 227 of the Constitution of India, against the aforesaid decree.

3. The first contention raised on behalf of the tenant is that, no demand notice was issued by the landlord or served on the tenant. It is next contended that, the purported demand notice dated 16-12-1976 (Exh.21) does not fulfill the requirements of a demand notice within meaning of Section 12(2) of the Act read with Section 106 of the Transfer of Property Act and, therefore, invalid notice in the eyes of law. It is contended that since it is a case of no notice or of invalid demand notice, in such a situation the suit on the ground of default cannot be maintained and proceeded against the tenant in view of the mandate of Section 12(2) of the Act. It is next contended that, in any case, the Appellate Court has committed error in concluding that the case was covered by the rigorous of Section 12(3)(a) of Rent Act, in spite of having held that rent was neither payable monthly nor yearly. It is submitted that if the rent was not payable monthly, then in such a situation, the provision of Section 12(3)(a) will have no application. It is next contended that even the reasons recorded by the appellate Court to decree the suit on the ground of default within the meaning of Section 12(3)(b) of the Act were devoid of merits.

4. On the other hand the learned Counsel for the Respondent has adopted the reasoning given by the Appellate Court and submits that no interference is warranted in the present case. He contends that there was clear notice to the tenant vide Exh.21 and the Appellate Court has rightly concluded that notice was sufficient compliance of requirement of Section 12(2) of Rent Act. He submits that, undisputedly, there were series of proceedings between the parties in the past; in such a situation, the Court will proceed on the assumption that the previous proceedings were in nature of demand set up by the landlord. The buttress this submission reliance is placed on the decision of the Division Bench of this Court reported in Vol. LXXI (1968) BLR page 607/- Venktarao Anant Pal v. Narayanlal Bansilal. He further submits that it is well settled that notice should be construed liberally and the Courts cannot adopted pedantic approach. Reliance is placed on the decision of the apex Court reported in AIR 198 SC 976 Rakesh Kumar and Anr. v. Hindustan Everest Tool Ltd. - to support this contention. It is contended that the tenant has admitted that he was a monthly tenant, therefore, it is not open for him to now contend that the case was not governed by the provisions of Section 12(3)(a) of the Rent Act. He submits that merely because landlord has not accepted the rent on month to month basis that would not mean that the rent was not payable monthly, so as to get extricated from the provisions of Section 12(3)(a) of Rent Act. He therefore, submits that the case was covered by the provisions of Section 12(3)(a) of the Act. he further submits that in any case the Appellate Court has analyzed the materials on record and has returned a finding of fact that the tenant was defaulter also within the meaning of Section 12(3)(b) of Rent Act; in such a situation it was not open for this Court to reappreciate the materials on record to take a different view. He submits that the reasons recorded by the Appellate Court cannot be said to be perverse or manifestly wrong. He therefore, contends that no interference is warranted in exercise of writ jurisdiction.

5. Having considered the rival submissions to my mind, it is necessary to first examine as to whether the landlord had issued demand notice or had served the same on the tenant as required by the provisions of Section 12(2) of the Rent Act read with Section 106 of Transfer of Property Act? There is little doubt that the landlord has instituted the present suit on the premise that the reply sent on his behalf (Ex.21) dated 16-12-1976 was in the nature of demand notice. Indeed, the court will be required to consider whether that document is in the nature of demand notice with the meaning of Section 12(2) of the Bombay Rent Act read with Section 108 of the transfer of Property Act or substantially complies the requirements of the abovesaid provisions of law? If the answer were to be in the negative then it would follow that there has been no demand notice at all, in which case there was no cause of action to maintain suit for possession on the ground of default under Section 12(3)(a) of the Act, rather such a suit is barred by Section 12(2) of the Act. Similarly, it will have to be established on record that the purported demand notice (Ex.21) has been duly served on the tenant in accordance with law. The Appellate Court has adverted to the contention of the tenant that no demand notice has been served on him, but proceeded to examine the matter on the premise that reply sent on behalf of the landlord (Exh.21) was a demand notice. The Appellate Court has then assumed that the said purported notice has been duly served upon the tenant. This finding recorded by the Appeal Court is in the absence of any legal evidence in that behalf, for absolutely no evidence has been adduced by the landlord plaintiff that he had caused to serve the demand notice on the tenant. For this purpose it will be apposite to advert to the deposition of Ajit K. Lokhande (PW 1) who is the son of the landlord. The relevant portion pertaining to the ground of default as stated in the examination in chief, reads thus:-

"My father did not come to the court due to weakness. I have taken all the information in respect of the suit and I am deposing for my father. Deft is in possession of 2 rooms admeasuring 10 x 40 ft."

"Deft had deposited Rs. 1960-000 in Reg.C.S.No. 99/70. We have withdrawn Rs. 1500/- in that suit. We have not withdrawn Rs. 460/- which were in excess."

"We have withdrawn Rs. 1500/- from the court towards the rent upto the end of 1974.

Deft failed to pay the rent for the year 1975. We are not ready to adjust to the tax paid by the deft in Municipality and the amount deposited by him in the court and the court costs awarded to him in the previous litigation....."

From this evidence, it is incomprehensible that a positive finding can be recorded that the plaintiff has proved in evidence that the purported demand notice has been caused to be served on the tenant. It was necessary for the plaintiff to prove the factum of service of the purported notice because the tenant in his written statement had clearly disputed service of any demand notice on him. To put it differently the Appellate Court has recorded finding on the factum of service of demand notice in absence of any foundation laid by the landlord in that behalf. It is not even remotely suggested in his evidence that demand notice as required by provision of Section 12(2) of the Act has been caused to be served on the tenant. Section 12(2) of Rent Act reads thus:-

Section 12(2) No suit for recovery of possession shall be instituted by a landlord against tenant on the ground on nonpayment of the standard rent or permitted increases are in arrears for a period of six months or more and the tenant neglects to make payment thereof until the expiration of the period of one month after notice referred to in Sub-section (2) the Court shall pass a decree for eviction in any such suit for recovery of possession.

No suit for recovery of possession shall be instituted by the landlord against the tenant on the ground of non payment of standard rent or permitted increases, due, until expiration of one month next after the notice in writing of demand of standard rent or permitted increases has been served upon the tenant in the manner provided in Section 106 of Transfer of Property Act, 1882".

6. The law mandates that, prior to institution of suit, demand notice as required by the said provision has been duly served upon the tenant in accordance with the requirement stated therein. The landlord is not only expected to plead that requirement has been fulfilled but is also obliged to prove the same. This is essential atleast when the tenant in his written statement has disputed the factum of service of demand notice on him. Indeed the courts would examine the issue only in the context of foundation laid during the trial in the pleadings and evidence which has been adduced by the parties. In the present case there is absolutely no evidence much less proof to establish the fact of service of purported notice on the tenant. If that be so, any other argument would be of no avail to the plaintiff as by virtue of mandate of Sub-section (2), no suit for recovery of possession can be maintained in law. Viewed in this perspective, it was wholly unnecessary for the court below to dwell upon other matters.

7. Assuming that the landlord was justified in contending that the reply sent on his behalf on 16-12-1976 (Exh.21) was in the nature of demand notice, but it is seen from the materials on record that the said reply has been addressed to the Advocate and not to the tenant himself. Sub-section (2) of Section 12 requires that demand notice has to be served on the tenant in the manner provided under Section 106 of Transfer of Property Act. In such a situation, it wa sobligatory on the plaintiff to then establish the fact that the Advocate to whom the notice was allegedly sent and was intended to be served on the tenant, was duly authorized to receive such a notice. As observed earlier there is absolutely no evidence whatsoever regarding the demand made muchless the manner or mode of service of purported notice. Even for this reason the reply notice (Exh.21) sent by the landlord cannot be said to have been duly served on the tenant within menaing of Section 106 of transfer of Property Act read with Section 12(2) of Bobmay Rent Act. In this view of the matter it will not be necessary to examine any other aspect of the case because the suit as filed by the landlord was not maintainable and could not be proceeded by virtue of bar under Section 12(2) of the Act.

8. That takes me to the question as to whether reply (Ex.21) was in the nature of demand notice or in substantial compliance of the requirement of Section 12(2) of the Act. In the first place, it will have to be borne in mind that notice sent by the tenant dated 15-11-1976 (Exh.20) was on the basis of his understanding of the order passed in his favour. In that context he claimed that certain adjustments will have to be made and the landlord was obliged to provide such adjustment and reimburse the excess amount referred to therein. It is in response to this notice the landlord sent reply dated 16-12-1976 (Exh.21). What is relevant to note is that the landlord not only disputed the possibility of adjustment or amount as claimed by the tenant, but has taken stand that he was entitled for arrears of monthly rent. It will be necessary to straight way advert to para 8 of this reply which the Appellate court has found to be in nature of demand notice and sufficient compliance of Section 12(2) of the Act. The same reads thus:-

"According to Section 20 of Rent Act, your client cannot demand the rent of more than six months and your client has lost the right of adjustment. In spite of this, if your client takes any steps, he will be responsible for costs and consequences. As the question of adjustment does not arise and as your client has not paid the rent for more then six months, his right of monthly tenancy according to the law has come to an end, of which please take a notice. My client will take further action after giving the required notice at the proper time."

It is well settled that Section 12(2) of the Act requires the landlord to serve the demand notice on the tenant. That notice is required to be writing of the demand of standard rent or permitted increases. The prerequisite of such notice is that the landlord makes a demand and calls upon the tenant to pay within the statutory period and puts him to further notice that if he fails to do so then it would result in action of eviction in accordance with law. If that is lacking in the communication sent by the landlord then it is not possible to hold that it was a valid demand notice within meaning of Section 12(2) of the Act. Besides making that demand, the law also obligates the landlord to serve such notice on the tenant in terms of Section 106 of Transfer of Property Act to determine the tenancy before proceeding to seek eviction of the tenant. In the present case, nothing of this has happened. On the other hand, on the plain language of (Exh.21) in particular para 8 thereof, it is seen that the same is ex-facie misleading and cannot be termed as a demand notice as required within the meaning of Section 12(2) of the At. It makes no demand to the tenant to pay the arrears but only observes that tenant has lost right of adjustment; and puts the tenant to notice that in spite of the reply offered if the tenant wants to precipitate the matter he would do so entirely at his costs and consequences. It further mentions that sine the tenant has not paid rent for more than six months, his right of monthly tenancy has come to an end. There is no clear or express demand or statement made that the landlord has decided to determine the tenancy of the tenant which is the quint-essence of a demand notice under Section 12(2) of the Rent Act read with Section 106 of the Transfer of Property Act. Whereas it posits that the landlord will take further action after giving required notice at the proper time. This clearly concedes the position that a proper demand notice will have to be sent to the tenant. Instead of taking recourse to that measure the landlord has proceeded to institute the present suit without issuing such demand notice. To my mind, on reading this reply one is bound to be mislead and would expect that the landlord will send a proper demand notice within the meaning of Section 12(2) of the Act to take the matter to its logical end. Understood thus, by no stretch of imagination such communication can be said to be a demand notice, much less a valid demand notice, as is contended on behalf of the landlord. The Appellate Court, therefore, completely misdirected itself in assuming that the said communication was substantial compliance of the requirement of Section 12(2) of the Act. On the other hand, the trial Court in para 15 of its judgment has rightly analyzed that notice to hold that it cannot be said to be a demand notice within the menaing of Section 12(2) of the Rent Act. In the circumstances the view taken by the appellate court that it is a valid notice cannot be sustained either on facts or in law.

9. To get over this position, the learned Counsel for the Respondent landlord contends that the Court should analyze the notice liberally. To support this contention he has placed reliance on the decision of the apex Court in the case of Rakesh Kumar and Anr. (supra). However, to my mind that decision would be of no avail to the Respondent. In that decision the Court has observed that on reading the notice along with the letter and reply it was apparent that tenant was intimated that any default of tenant eviction would follow. In the present case however, no such intimation has been given to the tenant. On the other hand, the communication indicates that the landlord will take further action after giving the required notice at the proper time.

10. The next decision relied on behalf of the Respondent is in the case of Venkatrao Anant Pai (supra). Even this decision would be of no avail to the fact situation of the present case. In that case the Court has observed that several suits were filed by the landlords against the tenant. The suit in question against which the proceedings commenced before the High Court was filed in subsequent point of time and earlier suits were pending at the relevant time. In that backdrop the Court observed that the defendant did not continue as a contractual tenant, no question of terminating his tenancy arose. The Court further observed that so far as notice of demand was concerned, two suits themselves were enough demand to enable the plaintiffs to file a suit for recovery of possession. In the present case, however, no suit was pending against the tenant at the relevant point of time. Besides, there was controversy between the parties relating to the liability of the tenant which got settled by the order passed on 17-6-1976 and immediately thereafter on the understanding of the tenant of that order, communication was sent to the landlord on 15-11-1976. According to the tenant, he was not in default and was entitled for adjustment and reimbursement by virtue of that order, whereas according to the landlord in spite of order in favour of the tenant, the tenant was liable to pay arrears of rent and which is so stated by the landlord in his reply dated 16-12-1976 (Exh.21). That by itself does not mean that tenant was served with demand notice as required within the meaning of Section 12(2) of the Rent Act read with Section 106 of Transfer of Property Act. Understood thus, even the later decision would be of no avail to the Respondent.

11. Since I have taken a view that there is no proof regarding service of any demand notice on the tenant, as well as having held that the purported notice (Exh.21) is not a demand notice, it will necessarily follow that the suit as filed by the landlord could not have proceeded in law. Accordingly, it will not be necessary to address other aspects of the matter examined in extenso by the two courts below. This is so because once it is found that the landlord had no cause of action to institute the present suit for want of demand notice, the court cannot in such a suit pass decree for possession under Section 12(3)(b) of the act especially in a case of no demand notice and no determination of tenancy. (See 2002(2) Mah.L.J.467 Ravilas v. Briharilal and 1984 Mah.L.J. 313 (D.B.) Narhar D. Wani v. Narmadabai, para 11).

12. Accordingly, this writ petition succeeds. The impugned order passed by the appellate court is set aside and instead the judgment and decree passed by the trial Court dismissing the suit for possession filed by the Respondent is restored.

13. Rule made absolute. No order as to costs.

Certified copy expedited.