Calcutta High Court
Jatia Estates Limited vs Nirwan Finvest Private Limited on 6 March, 2025
IN THE HIGH COURT AT CALCUTTA
(Ordinary Original Civil Jurisdiction)
ORIGINAL SIDE
Present:
The Hon'ble Justice Krishna Rao
GA No. 1 of 2024
With
GA No. 2 of 2024
With
GA No. 3 of 2024
With
GA No. 4 of 2024
In
CS No. 185 of 2024
Jatia Estates Limited
Versus
Nirwan Finvest Private Limited
Mr. Tilak Bose, Sr. Adv.
Mr. Arindam Guha
Mr. Shuvasish Sengupta
... For the plaintiff.
2
Mr. Shyamal Sarkar, Sr. Adv.
Mr. Ram Anand Agarwal
Mr. Rajesh Gupta
Ms. Nibedita Pal
Mr. Ananda Gopal Mukherjee
Ms. Sonam Ray
Mr. Viraj Gupta
... For the defendant.
Hearing Concluded On : 26.02.2025
Judgment on : 06.03.2025
Krishna Rao, J.:
1. The plaintiff has filed an application being G.A. No. 1 of 2024 praying
for interim order. The defendant has filed an application being G.A. No.
2 of 2024 for rejection of plaint. The plaintiff has filed an application
being G.A. No. 3 of 2024 under Chapter XIIIA of the Original Side Rules
of this Court for summary judgment. The defendant has filed an
application being G.A. No. 4 of 2024 for extension of time to file written
statement.
2. Mr. Shyamal Sarkar, Learned Senior Advocate representing the
defendant submits that the plaintiff has filed the present suit against
the defendant for eviction of the defendant under the provisions of the
Transfer of Property Act, 1882 but the fact remains that the rent for the
two premises is being Rs. 3000/- and Rs. 3150/- respectively and the
defendant is a monthly tenant. He submits that the tenancy is governed
under the provisions of the West Bengal Premises Tenancy Act, 1997.
3. Mr. Sarkar submits that in paragraph 2 of the plaint, the plaintiff
admitted that the defendant is a monthly tenant with respect to two
tenancy governed by agreements dated 2nd June, 1997 and 1st
September, 1997. He submits that as per the Agreement dated 1st
September, 1997, the rent is Rs. 3,150/- including service charges of
Rs. 1000/- per month and the rent was agreed to increase by 5% on
expiry of every 10 years. He submits that one Chandmal Properties
became sub-tenant of the defendant and the defendant has right to
sublet.
4. Mr. Sarkar submits that Agreement dated 2nd June, 1997 provides
monthly rent of Rs. 3,000/- per month without any escalation and the
defendant has right to sublet. He submits that the plaintiff issued two
notices under the West Bengal Premises Tenancy Act, 1997 dated 1st
August, 2017 to enhance the rent. He submits that the defendant did
not accept the enhancement of rent and requested the plaintiff to hold
a meeting to discuss with respect to enhancement of the rent. He
submits that plaintiff insisted that the bills already raised amounting to
Rs. 7,05,460/- are to be paid first as precondition and only then, any
discussion can be held. He submits that the defendant paid the said
amount in instalments and requested the plaintiff to sit for a
discussion for enhancement of rent.
5. Mr. Sarkar submits that no meeting was held and there was no
agreement regarding increase of rent. He submits that the plaintiff did
not want to sit for any discussion. To avoid any penalty or interest from
the Income Tax Authorities and as per advised by the accountant of the
defendant, the defendant has paid some random amount towards TDS.
He submits that the two tenancies at all material times governed by the
provisions of the West Bengal Premises Tenancy Act, 1997 but for the
alleged non-payment of the purported increased rent, the plaintiff has
issued a notice dated 10th July, 2024 under Section 106 of the Transfer
of Property Act, but no notice under Section 6(4) of the West Bengal
Premises Tenancy Act, 1997 was issued.
6. Mr. Sarkar submits that it is clear from the letter dated 24th July, 2019,
the defendant never confirmed its acceptance to enhance rent. He
submits that there is no agreement to increase of rent, rent continued
to be Rs. 3,150/- and Rs, 3,000/- per month respectively. He submits
that payment of TDS does not amount to any acknowledgement as it
neither refers to any contract between the parties nor records any
transaction between the parties. In support of his submissions, Mr.
Sarkar relied upon the Judgment in the case of S.P. Brothers vs.
Biren Ramesh Kadakia reported in 2008 SCC OnLine Bom 1599.
7. Mr. Sarkar submits that the monthly rent of the premises are Rs.
3,150/- and Rs. 3,000/- per month respectively thus as per provisions
of Section 3(f) of the West Bengal Premises Tenancy Act, 1997 governed
under the provisions of the Act of 1997.
8. Mr. Sarkar submits that no "fair rent" is fixed in accordance with
Section 17 of the Act of 1997. The increase of rent by six times by the
notices both dated 1st August, 2017 was illegal and void and is not
binding upon the defendant. He submits that the Act of 1997 has not
permitted the landlord to fix rent or mode of increase of fair rent
according to its own choice. He submits that in case of change of rate of
rent, the parties can mutually agree or in case of difference as
statutorily obliged to approach the controller and even Civil Court's
jurisdiction is excluded. In support of his submissions, he has relied
upon the Judgment in the case of Food Corporation of India vs.
Anurag Properties Pvt. Ltd. reported in 2006 SCC OnLine Cal 417.
9. Mr. Sarkar submits that the leases of immovable property from year to
year or for any term exceeding one year or reserving a yearly rent are to
be compulsory registered. All other instruments, namely, any
instrument for monthly tenancy, are not to be compulsorily registered.
He submits that the two agreements are not required to be registered
and the tenancy of the defendant is monthly tenancy.
10. Per contra, Mr. Tilak Bose, Learned Advocate representing the plaintiff
submits that the two agreements are unregistered and insufficiently
stamped, thus are not admissible in evidence. In support of his
submissions, has relied upon the Judgment in the case of Santosh
Jayaswal and Another vs. State of M.P. & Others reported in (1995)
6 SCC 520. He submits that it is settled law that unregistered
agreement creates only monthly tenancy and terms cannot be
considered. Mr. Bose submits that the two monthly tenancies were
subsequently clubbed into single monthly tenancy by the acts and
conduct of the defendant.
11. Mr. Bose submits that it is settled law that even by consent, an
unstamped/ insufficiently stamped documents which are inadmissible
in evidence cannot be admitted in evidence. In support of his
submissions, Mr. Bose relied upon the Judgment in the case of
Avinash Kumar Chauhan vs. Vijay Krishna Mishra reported in
(2009) 2 SCC 532. He further submits that no manner of consent even
allows an instrument with insufficient stamp duty to pass unchallenged
merely due to technicalities which would result in undermining the
legislative intent and fiscal interest of the State. In support of his
submissions, he has relied upon the Judgment in the case of G.M.
Shahul Hameed vs. Jayanthi R. Hegde reported in (2024) 7 SCC
719.
12. Mr. Bose submits that for unregistered tenancy agreements, reference
may be made to Sections 17 and 49 of the Registration Act, 1908. The
terms of unregistered agreement as per proviso to Section 49 of the
Registration Act, 1908 cannot be looked into and are not regarded as
evidence of collateral transaction. In support of his submissions, he has
relied upon the Judgments in the case of M/s. Bajaj Auto Limited vs.
Behari Lal Kohli reported in (1989) 4 SCC 39, K.B. Saha and Sons
Private Limited vs. Development Consultant Limited reported in
(2008) 8 SCC 564 and Park Street Properties Private Limited vs.
Dipak Kumar Singh & Anr. reported in (2016) 9 SCC 268.
13. Mr. Bose submits that the defendant has made payments for the period
from August, 2017 to March, 2019 in five instalments of an aggregate
sum of Rs. 7,05,460/-. In respect of the said payments, TDS returns
were also uploaded, wherefrom it appears that the defendant treated
consolidated rent of Rs. 35,273/- per month in respect of two
tenancies. He further submits that even for the subsequent period, the
same amount of the rent has been shown in the TDS statement
uploaded by the defendant but the rent has not been paid for which
there is separate claim of Rs. 21,38,942/-.
14. The plaintiff is the absolute owner of a land measuring approximately 4
Cottahs 8 Chittacks and 43 Sq. Ft. together with a ground plus three
storied building including (mezzanine floor and the roof) erected
thereon, being premises No. 21, Rupchand Street, Burrabazar, Kolkata-
700 007. The plaintiff and the defendant entered into two unregistered
agreements dated 2nd June, 1997 and 1st September, 1997 wherein the
plaintiff inducted the defendant as a monthly tenant of the entirety of
the building save and except a room measuring 1000 square feet
approximately situated on the ground floor of the said premises and
located on the Northern side of the building. The Agreement dated 2nd
June, 1997 provides monthly rent of Rs. 3,000/- per month without
enhancement and the tenant has right to sublet. The agreement dated
1st September, 1997, the rent is Rs. 3,150/- including service charges
of Rs. 1000/- per month and it was agreed that the rent will be
increased by 5% on expiry of every 10 years. The terms and conditions
of both agreements are more or less same except in the agreement
dated 2nd June, 1997, there is no clause for enhancement of monthly
rent.
15. As per the case of the plaintiff that the period of tenancy is more than
one year and is compulsorily registerable. On the other hand, the case
of the defendant is that the two tenancy agreements providing for
month to month tenancy were not compulsorily registerable.
Clauses 1, 2, 3, 13 and 14 of the Agreement dated 2nd June, 1997
reads as follows:
"1. The Landlord hereby induct the Tenant as
monthly tenant in respect of the entire Second floor,
entire third floor and the roof of the said premises
No. 21, Rup Chand Roy Street, Calcutta - 700 007
on and from the date of execution of this Agreement
for Tenancy. The Tenant shall pay monthly rent of
Rs. 3,000/- (Rupees Three thousand only) inclusive
of all service charges in respect of the said entire
Second floor, entire third floor and the Roof of the
premises No. 21, Rup Chand Roy Street, Calcutta
700 007, fully described in Schedule hereunder
written.
2. The Tenant shall have the right to sublet
the said demised premises or any portion or
portions thereof to such person or persons of its
own choice and on terms and conditions to be
agreed upon by and between the said Sub-tenants
and the Tenant only once. The Tenant shall have
further right to induct sub-tenant for the second or
subsequent times with prior consent of the
Landlord;
3. The Landlord shall not call upon the Tenant
to vacate the said demised premises or any portion
thereof on the ground of his own use and
occupation and/or for building or rebuilding thereof
or under any law, statute, Ordinance presently in
force or enacted or passed on any future date by
any Government, Semi Government, Body or Court
of Law;
13. The Tenant shall have right to make
additions and alterations to the demised premises
without previous permission and interference of the
Landlord but on obtaining permission from the
Calcutta Municipal Corporation;
14. In case the Tenant fails and neglects to
pay monthly rent for twelve months or fails and
neglects to comply with the terms and conditions of
this Agreement for Tenancy, in that case the
Landlord shall have right to cancel this Agreement
for Tenancy and re-enter into the demised
premises."
Clause 1 of the Agreement dated 1st September, 1997 reads as
follows:
"1. The Landlord hereby induct the Tenant as
monthly tenant in respect of the entire Ground floor,
entire 1st floor and mezzanine floor of the said
premises No. 21, Rup Chand Roy Street, Calcutta
700 007 on and from the date of execution of this
Agreement for Tenancy. The Tenant shall pay
monthly rent of Rs. 2,150/- (Rupees Two thousand
one hundred and fifty only) and service charge Rs.
1,000 per month in respect of the said entire
Ground floor, entire first floor and mezzanine floor
of the premises No. 21, Rup Chand Roy Street,
Calcutta 700 007, fully described in the Schedule
hereunder written. Rent and Service Charge will be
increased by 5% on expiry of every 10 years."
16. Section 17(1)(d) of the Registration Act, 1908 reads as follows:
"17. Documents of which
registration is compulsory.- (1) The following
documents shall be registered, if the property to
which they relate is situate in a district in which,
and if they have been executed on or after the date
on which, Act XVI of 1864, or the Indian
Registration Act, 1866, or the Indian Registration
Act, 1871, or the Indian Registration Act, 1877, or
this Act came or comes into force, namely,
(d) leases of immovable property from year
to year, or for any term exceeding one
year, or reserving a yearly ren."
Section 107 of the Transfer of Property Act, 1882 reads as follows:
"107. Leases how made.- A lease of
immovable property from year to year, or for any
term exceeding one year or reserving a yearly rent,
can be made only by a registered instrument.
[All other leases of immoveable property may
be made either by a registered instrument or by
oral agreement accompanied by delivery of
possession.
[Where a lease of immovable property is made
by a registered instrument, such instrument or,
where there are more instruments than one, each
such instrument shall be executed by both the
lessor and the lessee:]
Provided that the State Government may [***]
from time to time, by notification in the Official
Gazette direct that leases of immovable property,
other than leases from year to year, or for any term
exceeding one year, or reserving a yearly rent, or
any class of such leases, may be made by
unregistered instrument or by oral agreement
without delivery of possession.]"
Section 17(1)(d) of the Registration Act, 1908 and Section 107 of
the Transfer of Property Act, 1882, provides that "from year to year", or
"any term exceeding one year". In the case of Santosh Jayaswal &
Anr. (supra), the Hon'ble Supreme Court held that :
"8. Under Section 17 of the Registration Act,
read with Section 2(16) of the Indian Stamp Act,
'lease' means a lease of immovable property and
includes a patta, a kabuliyat or other undertaking
in writing, not being a counterpart of a lease to
cultivate, occupy, or pay or deliver rent for
immovable property etc. Right to catch fish is profit
a prendre and benefit to arise out of land is an
immovable property for the purpose of stamp duty.
It would, therefore, be clear that since it is a right
given to the appellants to catch fish in the tank, it is
a profit a prendre attached to or benefit to arise out
of the land. Therefore, it is an instrument for the
purpose of stamp duty. Since the duration of lease
in LPA No. 21 of 1994 is only nine months, it is not
a compulsorily registrable instrument by operation
of Section 17(1)(c) of the Act. The civil appeal
arising out of LPA No. 21 of 1994 relating to
Santosh Jaiswal is, therefore, partly allowed. It is
an instrument which requires to bear the
appropriate stamp duty but is not a compulsorily
registrable instrument. In appeal arising out of LPA
No. 22 of 1994 of Surendra Shukla, since the
duration of lease is more than a year, it is an
instrument and compulsorily registrable by
operation of Section 17(1)(c) of the Registration Act
and liable to stamp duty under the Indian Stamp
Act. Therefore, it cannot be acted upon unless it is
duly engrossed with stamp duty and registered."
In the case of Satish Kumar vs. Zarif Ahmed and Others
reported in (1997) 3 SCC 679, the Hon'ble Supreme Court held that:
"7. The question, therefore, that arises is
whether a lease of immovable property from month
to month or for 11 months is a compulsorily
registerable document, though it was reduced to
writing as an instrument defined under Section
2(14) of the Stamp Act. A conjoint reading of the
first part of Section 107 read with Section 17(1)(d)
of the Registration Act, as extracted hereinbefore,
does indicate that a lease of immovable property
from year to year, or for any term exceeding one
year or reserving an yearly rent should be made
only by a registered instrument and all other
instruments, though reduced to writing and
possession is delivered thereunder, are not
compulsorily registerable instruments."
In the case of Siri Chand (dead) Through Legal Representatives
vs. Surinder Singh reported in (2020) 6 SCC 288, the Hon'ble
Supreme Court held that:
"21. We may notice that in the above case
although the annual rent was mentioned but,
however, payment of monthly rent was mentioned
in the lease deed. The rent note, which we are
considering contains only monthly rent and
payment month by month. As per law laid down by
this Court in Ram Kumar Das there shall be a
presumption that the tenancy in the present case is
monthly tenancy. When the clauses of rent note are
cumulatively read, the intention of the tenant is
more than clear that tenancy was only monthly
tenancy, which could have been terminated on
default of payment of rent by 5th day of any month
or by notice of one month. The rent deed did not
confer any right to tenant to continue in the tenancy
for a period of more than one year nor it can be
said that tenancy was created for a period of more
than one year. Clause (9), which noticed the
promise of the tenant of payment of rent by
increasing 10% each year was a promise
contingent on tenancy being continued beyond one
year but cannot make the tenancy year to year or
tenancy for a period of more than one year. Present
was a case of tenancy for which no period was
specified and looking to all the clauses
cumulatively, we find that the rent note was not
such kind of rent note, which requires compulsory
registration under Section 17(1)(d)."
If one read Clause 3 and Clause 9 of the Agreement dated 1st
September, 1997 and Clause 3 and Clause 14 of Agreement dated 2nd
June, 1997, it is clear that Clause-3 creates the perpetual tenancy and
Clause 9 of Agreement dated 1st September, 1997 and Clause 14 of
agreement dated 2nd June, 1997 provides that "In case the tenant fails
and neglects to pay monthly rent for twelve months", so the tenancy is
more than one year. In Clause 1 of the Agreement dated 1st September,
1997, it is also mentioned that "rent and service charge will be
increased by 5% on expiry of every 10 years".
On plain reading of the said Clauses, it transpires that the
agreements do not create any tenancy terminable at Will. In the case of
Siri Chand (supra) in paragraph 2.1, the Hon'ble Supreme Court
noted that "The shop owner, if is in need of the shop, can serve notice of
one month and get the shop vacated from the tenant" but in the case in
hand, the said liberty is not with the owner.
17. Considering the above, this Court rejects the contention of the
defendant that the tenancy is month to month and the agreements are
not required to be registered.
18. As per agreement dated 2nd June, 1997, the monthly rent is Rs. 3000/-
inclusive of all service charges. As per the Agreement dated 1st
September, 1997, the monthly rent is Rs. 2,150 and service charge is
Rs. 1000/- per month and the rent and service charge will be increased
by 5% on expiry of every 10 years. The defendant had been making
payment of consolidated monthly rent in respect of the premises till 31st
July, 2017. On 1st August, 2017, the plaintiff issued two notices to the
defendant demanded for enhanced monthly rent along with service
charges and proportionate share of municipal tax aggregating to
Rs.35,273/- (Rs.20,547/- + Rs.14,726/-) in respect of the total
occupation of the defendant in the premises.
19. On receipt of the letters dated 1st August, 2017 in between 1st October,
2018 to 28th March, 2019 by way of five cheques, the defendant has
paid an amount of Rs. 7,05,460/- towards rent, service charges and
municipal tax for a period from 1st August, 2017 to 31st March, 2019
without deducting TDS. Subsequently, the defendant has deposited an
amount of Rs. 65,625/- being TDS for the period from 1st August, 2017
to 31st March, 2019 against the total sum of Rs. 70,546/- leaving a
deficit of Rs. 4,921/-. The defendant has further deposited TDS for a
period from April, 2019 to June, 2020 amounting to Rs. 52,905/-.
20. The defendant relied upon two letters dated 6th April, 2018 and 24th
July, 2019. As per the case of the defendant, the defendant has issued
the letter dated 6th April, 2018 to the plaintiff regarding meeting for an
agreement towards enhancement of rent but the plaintiff has supressed
the said letter and not disclosed in the plaint. It is the further case of
the defendant that since the meeting for mutual agreement for
enhancement of the monthly rent did not take place between the
parties and to avoid any penalty or interest from the Income Tax
Authorities and as per advice of the Accountant has paid TDS. As
regard to the rent, it is the case of the defendant that the defendant has
paid total rent along with service charge to the plaintiff from the month
of August, 2017 to the month of October, 2024 total amounting to Rs.
5,28,900/- as per agreed rent and also paid an amount of Rs.
1,18,530/- towards TDS total amounting to Rs. 8,23,990/-, thus an
amount of Rs. 2,95,090/- is refundable by the plaintiff to the
defendant.
21. The defendant has relied upon the Judgment in the case of S.P.
Brothers (supra) wherein the Bombay High Court held that the
issuance of TDS certificates does not amount to an acknowledgement of
defendant within the meaning of Section 25 of the Indian Evidence Act
and the Full Bench Judgment of the Bombay High Court in the case of
Jyotsna (supra) puts the matter beyond doubt. The TDS certificate is
primarily to acknowledge the deduction of tax at source. The certificate
does not refer to any amount of loan or even the rate of interest which
is payable on the said principal amount. It does not refer to any
contract between the parties and even a transaction.
22. In the present case, the defendant has admitted that the defendant has
paid an amount of Rs. 7,05,460/- being the total rent and service
charge for the period from August, 2017 to October, 2024 and Rs.
1,18,530/- towards TDS aggregating to Rs. 8,23,990/-, thus an
amount of Rs. 2,95,090/- is refundable by the plaintiff to the
defendant.
In view of the above, the facts of the present case are
distinguishable from the facts of the case of S.P. Brothers (supra) and
thus the said judgment is not applicable in the present case.
23. On relying upon the letter dated 24th July, 2019, the defendant has
made out the case that the defendant has not accepted the
enhancement of the rent and requested the plaintiff to hold meeting for
discussion on account of increase of rent but the plaintiff insisted that
the bills were already raised and being precondition the amount is paid
in instalments.
24. On 14th May, 2024, the plaintiff has sent a letter to the defendant
calling upon the defendant to pay the outstanding rent of Rs.
20,84,108/- within fifteen (15) days from receipt of the notice but the
defendant has not paid the said amount and accordingly, the plaintiff
has sent a notice under Section 106 of the Transfer of property Act,
1882 on 10th July, 2024 by terminating the tenancy. The defendant in
the affidavit-in-opposition denied with regard to the service of the
notices dated 14th May, 2024 and 10th July, 2024. The plaintiff has not
disclosed with regard to service of letter dated 14th May, 2024. With
respect to notice under Section 106 of the Transfer of Property Act,
1882 dated 10th July, 2024, it reveals that the said notice sent to the
defendant in two addresses. As per the track report, one notice
delivered to "sender" not to "addressee" and another notice delivered to
the "addressee". Thus, it is clear that the notice under Section 106 of
the Transfer of Property Act, 1882, is duly served upon the defendant.
Though in the affidavit-in-opposition in GA No. 3 of 2024, the
defendant has denied with respect to receipt of the notice but during
argument, the defendant has not argued that the notice was not served
upon the defendant. The defendant has also not raised such plea in the
written notes of argument.
25. The plaintiff has argued that the defendant has neither sent any reply
to the notice under Section 106 of the Transfer of Property Act, 1882
nor has vacated the premises now at the later stage the defendant has
taken some other plea which is not permissible. The defendant has
argued that first available opportunity to raise objection to the notice
under Section106 of the Transfer of Property Act, 1882 is at the time of
filing of written statement. In support of his submissions, Mr. Sarkar
relied upon the Judgment in the case of Harjit Singh Uppal vs. Anup
Bansal reported in (2011) 11 SCC 672 wherein the Hon'ble Supreme
Court held that:
"26. In view of the above legal position, we
shall now advert to the facts of the present case.
The tenant at the first available opportunity i.e. in
his written statement filed on 24-4-2009 averred
that he has been paying the rent to the landlord by
cheques and from 1-4-2007, he has paid rent of Rs
37,00,950 to the landlord. As a matter of fact, the
tenant by his counterclaim prayed for refund of the
excess payment made to the landlord. Then he filed
his affidavit dated 6-6-2009 setting out the details
of the payments made towards rent from April
2007."
26. In the case of Apollo Zipper India Ltd. vs. W. Newman & Co. Ltd.
reported in (2018) 6 SCC 744, the Hon'ble Supreme Court held that :
"51. First, when the appellant sent a quit
notice dated 17-5-2012 to the respondent under
Section 106 of the TP Act determining the tenancy
and calling upon the respondent to pay the arrears
of rent and vacate the suit premises, despite receipt
of the quit notice, they did not reply to it.
52. In our view, the respondent ought to have
replied to the notice at the first available
opportunity, which they failed to do so. It amounts
to waiver on their part to challenge the invalidity or
infirmity of the quit notice including the ownership
issue raised therein.
53. In Parwati Bai v. Radhika, the question
arose as to whether the tenancy was terminated in
accordance with the provisions of Section 106 of
the TP Act. The defendant despite receiving the
notice from the plaintiff did not reply to it.
54. This Court held that if the defendant does
not raise any objection to the validity of quit notice
at the first available opportunity, the objection will
be deemed to have been waived. The following
para 6 of the decision is apposite which reads as
under :
"6. The singular question to be examined
in the present case is whether the tenancy
was terminated in accordance with the
provisions of Section 106 of the Transfer of
Property Act. The receipt of notice by the
defendant is admitted in the written
statement. The defendant has not raised any
specific objection as to the validity of the
notice. An objection as to invalidity or infirmity
of notice under Section 106 of the TP Act
should be raised specifically and at the
earliest; else it will be deemed to have been
waived even if there exists one. It cannot,
therefore, be said that the notice in the present
case suffered from any infirmity. A copy of the
notice was exhibited and proved by the
plaintiff as Ext. P-4."
27. In the case of Harjit Sing Uppal (supra), the landlord challenged
before the Hon'ble Court was the order passed by the Rent Controller
and the Rent Controller has not considered the affidavit filed by tenant
and thus the Hon'ble Supreme Court held that the tenant at the first
available opportunity i.e. in his written statement filed on 24th April,
2009 averred that he has been paying the rent to the landlord by
cheques. In the present case, the defendant has received the notice
under Section 106 of the Transfer of Property Act, 1882 but has not
sent any reply. In the affidavit-in-opposition also he has not thrown any
challenge to the said notice but only denied that it was not received but
the track report of the Postal Authority established that notice was
served upon the defendant.
28. The defendant has raised another objection that Section 2(b) of the
West Bengal Premises Tenancy Act, 1997 defines "fair rent" as the rent
fixed under Section 17 of the Act of 1997. The defendant says that
Section 17 of the Act of 1997 provides that only the Controller can fix
"fair rent" in accordance with the said Act. It is further stated that
Section 18 of the 1997 Act provides that fair rent fixed shall be
automatically increased by 5% every three years. It is the contention of
the defendant that increase of rent by six (6) times by the notices dated
1st August, 2017 are bad and illegal and is not binding upon the
defendant. It is further contended that Section 13 provides that no
tenant shall be liable to pay the landlord any amount in excess of fair
rent unless such amount is lawful increase in accordance with the
provisions of Section 17 of the Act of 1997. It is also contended that Act
of 1997 has not permitted the landlord to fix "fair rent". In support of
his submissions, Mr. Sarkar has relied upon the Judgment in the case
of Food Corporation of India vs. Anurag Properties Pvt. Ltd. and
Anr. reported in 2006 SCC OnLine Cal 417.
29. Section 2(b), 13, 17 and 18 of the West Bengal Premises Tenancy Act,
1997 reads as follows:
"2. Definitions.- In this Act, unless there is
anything repugnant in the subject or context,-
(b) "fair rent" means the rent fixed under
Section 17;
13. Rent in excess of fair rent not
chargeable. (1)(a) No tenant shall,
notwithstanding any agreement to the contrary, be
liable to pay to the landlord for the occupation of
any premises any amount in excess of fair rent of
the premises, unless such amount is lawful
increase of the fair rent in accordance with the
provision of this Act.
(b) Subject to the provisions of clause (a), any
agreement for payment of rent in excess of fair rent
shall be construed as an agreement for the
payment of fair rent only.
(2) Fair rent shall be paid within the time fixed
by the contract or, in the absence of any such
contract, by the fifteenth day of the next month
following the month for which it is payable,
provided the tenant may pay the rent payable for
any month at any time during such month before it
falls due.
17. Fixation of fair rent. (1)The
Controller shall, on application made to him either
by the landlord or by the tenant in the prescribed
manner, fix the fair rent in respect of any premises
in accordance with the provisions of this Act.
(2) The fair rent for a year in respect of any
premises constructed and let out after the year
1984, shall be fixed [on the basis of annual
payment of an amount equal to six and three-fourth
per cent per annum of the aggregate amount of the
actual cost of construction and the market price of
the land on the date of commencement of
construction.]
Explanation. - The cost of construction of a
premises shall include the cost of water supply and
sanitary and electric installation and shall be
determined with due regard to the rates adopted
for the purpose of estimate by the Public Works
Department of the State Government for the area
concerned. The Controller may allow or disallow
the variation of estimates upto ten per cent, having
regard to the nature of the premises:
Provided that while calculating the market
value of the site on which the premises was
constructed, the Controller shall take into account
only the portion of the site on which the premises
was constructed and sixty per cent of the portion of
the vacant land, if any, appurtenant to such
premises, the excess portion of the vacant land
being treated as amenity.
(3) Where a tenancy subsists for twenty years
or more in respect of the premises constructed in or
before the year 1984, the fair rent shall be
determined by adding to the rent as on 1.7.1976
not more than three times, and then deducting the
increase if any, in the manner provided in Schedule
II, or by accepting the existing rent if such rent is
more than the increased rent determined according
to that Schedule.
(4) Where a tenancy subsists for ten years or
more but less than twenty years in respect of the
premises constructed in or before the year 1984,
the fair rent shall be determined by adding to the
rent as on 1.7.1986 not more than two times, and
then deducting the increase if any, in the manner
provided in Schedule III, or by accepting the
existing rent if such rent is more than the increased
rent determined according to that Schedule.
(4A) Where a tenancy subsists for twenty
years or more in respect of the premises
constructed in or before the year 1984 and used for
commercial purpose, the fair rent shall be
determined by adding the rent as on 1.7.1976 five
times or by accepting the existing rent if such rent
is more than the increased rent determined under
this sub-section.
(4B) Where a tenancy subsists for ten years or
more but less than twenty years in respect of the
premises constructed in or before the year 1984
and used for commercial purpose, the fair rent shall
be determined by adding to the rent as on 1.7.1986
three times or by accepting the existing rent if such
rent is more than the increased rent determined
under this sub-section.
(5) Where at the commencement of this Act,
any proceeding is pending for fixation of the fair
rent of such premises under the West Bengal
Premises Tenancy Act, 1956, the rent fixed under
the said proceeding shall be the fair rent under this
Act.
(6) Where none of the foregoing provisions of
this section applies to any premises, the fair rent
shall be such as would be reasonable, having
regard to the situation, locality and condition of the
premises and the amenities provided therein and,
where there are similar or nearly similar premises
in the locality, having regard also to the rent
payable in respect of such premises.
18. Revision of fair rent.- The fair rent
initially fixed shall be automatically increased by
five per cent every three years:
Provided that the State Government may issue
notification varying such rate of increase every four
years from the date of commencement of this Act."
30. In the case of Food Corporation of India (supra), the Hon'ble Division
Bench of this Court held that :
"16. Question is whether a Writ Court can
permit a landlord to enforce a void contract simply
because the tenant is a State within the meaning of
the Article 12 of the Constitution of India. If by a
regular suit, the same cannot be done, by taking
recourse to Article 226 of the Constitution of India
the same relief cannot be achieved simply because
the defendant happened to be a State, for, a Writ
Court cannot direct the State to comply with a void
agreement.
18. As held by a Division Bench of this Court
in the case of Ramington Rand v. Rajgheria,
reported in 87 CWN 923, the West Bengal Premises
Tenancy Act has given exclusive jurisdiction to the
Rent Controller in the matter of fixation of fair rent.
Even a Civil Court is not competent to decide such
question. The Supreme Court has gone to the extent
that such a duty to assess fair rent or increase of
fair rent vested with a Controller or a Court, as the
case may be, under different Rent Control
legislations cannot be discharged by those
authority simply on the basis of consent of the
parties but must be adjudicated by the authority
invested with such duty to assess by application of
its mind on the basis of materials; otherwise, the
decision on the question of assessment of fair rent
would be a nullity (See: Prithivi Chand v. Shinde,
reported in AIR 1993 SC 1929 and Dev
Karan v. Monoharlal, reported in AIR 1994 SC
2747). Moreover, once an application for fixation or
fair rent is disposed of by increasing the existing
rent, according to the provisions contained in the
West Bengal Premises Tenancy Act, such increase
will take effect from the month next to the filing of
the application for fixation of fair rent and not from
a date anterior to it. In this case, the writ petitioner
wants increase from 1972 which is not at all
permissible under the law when no application has
yet been filed before the appropriate forum.
19. From our aforesaid discussions, it is clear
that the legislature has not permitted either the
landlord or the tenant to fix fair rent of a premises
or mode of increase of the fair rent according to
their own agreement earlier made before
commencement of tenancy unless agreed to and at
the same time, accepted by both the parties. Even
if, there was such agreement prior to
commencement of tenancy, the tenant or the
landlord is not bound by such agreement and if
any of them is not agreeable to enhance the
existing rent or wants to fix the fair rent, only
remedy available to the aggrieved party is to
approach before the Rent Controller. Even
according to section 4(3) of the West Bengal
Premises Tenancy Act, 1956 any amount in excess
of the fair rent is not recoverable by the landlord
and such provision has been maintained in section
13 of the new Act of 1997.
21. Moreover, even in the matter of creation of
tenancy as well as the terms of enhancement of the
rent according to the provisions contained in the
Transfer of Property Act, the agreement must be a
bilateral one and as pointed out earlier, once a
tenancy is continuing under the provisions of the
West Bengal Premises Tenancy Act, in case of
further change of rate of rent the parties are
required to approach the Controller and even Civil
Court's jurisdiction is excluded. In such a situation,
in our view, the learned Single Judge erred in law
in directing the Zonal Manager of the appellant to
come to a conclusion and to force the appellant to
agree to pay rent according to his determination."
In the said case in a writ proceeding, the Learned Single Judge of
this Court directed the Zonal Manager of the Food Corporation of India
to reconsider the matter afresh including the claim of the writ petitioner
for enhancement of rent from the year 1972. In paragraph 19, the
Hon'ble Division Bench of this Court held that "unless agreed to and the
same time, accepted by both the parties".
In the present case, it is the admitted case of the defendant that
the plaintiff has issued two notices both dated 1st August, 2017 and
then defendant has sent a letter to the plaintiff on 6th April, 2018 to
meet and discuss the matter and to resettle amicably. The letter dated
24th July, 2019 sent by the defendant to the plaintiff reads as follows:
Date: 24.07.2019
"To
Shri Sandeep Ji Jatia
Jatia Estates Limited
1, Penn Road
Alipore
Kolkata - 700 027
Respected Shri Sandeep Ji,
This with reference to your August 2017 rent
increment for Premises No. 21, Rup Chand Roy
Street, when we requested for a conversation with
you for the same. We were informed by your
representative that we should make the due
payment as per your bills first and the meeting can
be held post it. So, we initiated the payment in
October 2018, as per the bills provided, fully paid
as on the date.
We have been requesting your representative since
then to schedule a meeting, but in vain.
Payments of rent have been made upto date as on
May, 2019, as per the bills provided to us.
As requested by your representative to pre-inform
the purpose of the meeting, I would like to share
the same. I look forward to discuss the increment in
rent since August 2017 and also voice a few words
shared between your father, Shri Birendra Ji and
myself.
I would hence request a few minutes of your
valuable time.
Thanking You,
Regards,
Nirwan Finvest Pvt. Ltd.
Mahendra Kumar Jain
Mobile: 9830005262."
31. As per the said letter, the defendant has agreed to pay the bill raised by
the plaintiff for enhanced rent and has paid from 1st October, 2018 till
31st March, 2019 by way of five cheques on different dates total
amounting to Rs. 7,05,460/- without raising any objection. The
defendant has also admitted that the defendant has paid TDS. When
the plaintiff has demanded enhance rent, the defendant has not raised
any objection. The defendant stopped payment from the month of April,
2019, the plaintiff has sent notice to the defendant, inspite of receipt of
notice, the defendant has not raised any objection. Only when the
plaintiff has filed the present suit and also obtained an interim order,
the plaintiff has made out the case that the letter dated 24th July, 2019
is not the acknowledgement and the amount paid by the defendant is
the arrears of rent and service charges till October, 2024 and an
amount of Rs. 2,95,090/- is recoverable from the plaintiff.
32. This Court finds that the defendant on receipt of the notices both dated
1st August, 2017 and the bills raised by the plaintiff, accepted the
enhance rent and paid the same to the plaintiff from the month of
October, 2018 till March, 2019 and also paid TDS without any
objection, thus the contention raised by the defendant is not
sustainable.
33. Chapter XIIIA (B), Rules 6, 7 and 9 of the Original Side Rules of this
Court reads as follows:
"(B). for the recovery of immoveable property
with or without a claim for rent or mesne profits by
a landlord against a tenant whose term has
expired or has been duly determined by notice to
quit or has become liable to forfeiture for non-
payment of rent or against persons claiming under
such tenant.
6. Judgment unless good defence.- Upon
such application the Judge may, unless the
defendant by affidavit or otherwise as the Judge
may direct shall satisfy him he has a good defence
to the claim on its merits or disclose such facts as
may be deemed sufficient to entitle him to defend,
make an order refusing leave to defend and
forthwith pronounce judgment, in favour of the
plaintiff.
7. Where one defendant has good defence
but other not.- If it appears to the Judge that any
defendant has a good defence to or ought to be
permitted to defend the claim and that any other
defendant has not such defence and ought not to
be permitted to defend, the former may be
permitted to defend and the plaintiff shall be
entitled to judgment against the latter; and may
issue execution upon a decree to be drawn up
pursuant to such judgment without prejudice to his
right to proceed with his claim against the former.
9. Leave to defend. - Leave to defend may
be given unconditionally or subject to such terms as
to giving security, or time, or mode of trial or
otherwise as the Judge may think fit."
34. In the case of Kiranmayi Dasi vs. J. Chatterjee reported in 1945
SCC OnLine Cal 114, this Court held that :
"From the above authorities the following
propositions may be laid down with regard to an
application under O. XIV:--
(a) If the defendant satisfied the Court that he has
a good defence to the claim on its merits the
plaintiff is not entitled to leave to sign judgment
and the defendant is entitled to unconditional leave
to defend.
(b) If the defendant raises a triable issue indicating
that he has a fair or bona fide or reasonable
defence although not a positively good defence the
plaintiff is not entitled to sign judgment and the
defendant is entitled to unconditional leave to
defend.
(c) If the defendant discloses such facts as may be
deemed sufficient to entitle him to defend, that is to
say, although the affidavit does not positively and
immediately make it clear that he has a defence
yet shews such a state of facts as leads to the
inference that at the trial of the action he may be
able to establish a defence to the plaintiff's claim,
the plaintiff is not entitled to judgment and the
defendant is entitled to leave to defend, but in such
the Court may in its discretion impose condition as
to the time or mode of trial but not as to payment
into Court or furnishing security.
(d) If the defendant has no defence or the defence
set up is illusory or sham or practically moonshine,
there ordinarily the plaintiff is entitled to leave to
sign judgment and the defendant is not entitled to
leave to defend.
(e) If the defendant has no defence or the defence is
illusory or sham or practically moonshine then,
although ordinarily the plaintiff is entitled to leave
to sign judgment, the Court may allow the defence
to proceed if the amount claimed is paid into Court
or otherwise secured and give leave to the
defendant on condition and thereby show mercy to
the defendant by enabling him to try to prove a
defence."
35. As per Rule 9 of Chapter XIIIA of the Original Side Rules of this Court,
leave to defend may be given unconditionally or subject to such terms
as to giving security, or time, or mode of trial or otherwise as this Court
may think fit.
36. In the case of Kiranmayi Dasi (Supra), this Court held that if there is
no defence or the defence is illusory or sham or practically moonshine
then, although ordinarily the plaintiff is entitle to leave to sign
Judgment, the Court may allow the defence to proceed if the amount
claimed is paid into Court or otherwise secured and give leave to the
defendant on condition and thereby show mercy to the defendant by
enabling him to try to prove a defence.
37. In the present case, the defendant has filed an application under order
VII, Rule 11 of the CPC for rejection of plaint on the ground that the
suit filed by the plaintiff is not maintainable before this Court as the
tenancy governed under the West Bengal Premises Tenancy Act, 1997
and Section 106 of the Transfer of Property Act, 1882 does not apply.
The increased rent paid by the defendant is not an acknowledgment by
the defendant. This Court has decided all the issues raised by the
defendant against the defendant.
38. The plaintiff has filed an application under Chapter XIIIA of the Original
Side Rules of this Court on the ground that the defendant is in default
in paying rent and has also not vacated the premises on receipt of the
notice under Section 106 of the Transfer of Property Act, 1882.
39. Considering the above circumstances, this court finds that the defense
raised by the defendant are illusory and sham, thus no leave can be
granted to the defendant to defend the suit. In view of the above, the
application filed by the defendant under Order VII, Rule 11 of the CPC
for rejection of plaint being G.A. No. 2 of 2024 is dismissed. The
application filed by the plaintiff under Chapter XIIIA of the Original Side
Rules of this Court being G.A. No. 3 of 2024 is allowed. The defendant
is directed to vacate the premises situated at 21, Rupchand Roy Street,
Burrabazar, Kolkata- 700007 being Annexure "A" of the plaint and to
hand over the peaceful vacant possession of the premises to the
plaintiff. The defendant is also directed to pay Rs. 21,38,942/- being
the outstanding consolidated rent from April, 2019 till July, 2024.
40. As regard mesne profit, an enquiry is to be conducted to be conducted.
Shri Anuj Singh, (Mobile No. 9830202752), Advocate is appointed as
Special Referee to conduct enquiry to ascertain the mesne profit from
1st August, 2024 till the delivery of peaceful possession of the suit
premises by the defendant to the plaintiff. The remuneration of the
Special Referee is fixed Rs. 3,00,000/-. Initially, the plaintiff shall pay
the remuneration to the Special Referee and the plaintiff is at liberty to
recover the remuneration of the Special Referee from the defendant.
41. The Special Referee is directed to complete the enquiry within a period
of three (3) months from the date of receipt of this order and to submit
report on or before 11th June, 2025.
42. As this Court allowed the application filed by the plaintiff under
Chapter XIIIA of the Original Side Rules of this Court, thus no order is
required to be passed in G.A. No. 1 of 2024 and G.A. No.4 of 2024.
Accordingly, G.A. No.1 of 2024 and G.A. No. 4 of 2024 are thus
dismissed.
(Krishna Rao, J.)
Later:
After delivery of the judgment, Learned Counsel for the defendant
prayed for stay of the operation the judgment. Learned Counsel for the
plaintiff raised objection and submits that if the defendant fail to
comply with the judgment, the plaintiff has to file execution petition,
thus no order of stay can be passed.
Heard the Learned Counsel for the respective parties, prayer for
stay is refused.
(Krishna Rao, J.)
