Delhi High Court

Hari Singh vs Rajinder Prashad Sharma on 19 May, 2010

Author: S. Muralidhar

       IN THE HIGH COURT OF DELHI AT NEW DELHI

                            CM (M) 297/2009

       HARI SINGH                                         ..... Petitioner
                            Through: Mr. Chetan Sharma, Senior Advocate
                            with Mr. Pardeep Sharma, Mr. Shubhashish
                            Kukreti, Advocates

                   versus

       RAJINDER PRASHAD SHARMA                  ..... Respondent
                    Through: Mr. Rajeev K.Virmani, Senior Advocate
                    with Mr. Vivek Sharma and
                    Mr. Vaibhav Bhadana, Advocates

       CORAM: JUSTICE S.MURALIDHAR

       1. Whether reporters of local paper may be allowed
          to see the order?                                        No

       2. To be referred to the report or not?                    Yes

       3. Whether the order should be referred in the digest?     Yes

                              ORDER

19.05.2010

1. The challenge in this petition filed by the Petitioner/landlord in respect of

the premises at 4/2706, Gali No. 5, Bihari Colony, Delhi (‗premises') is to

an order dated 9th March 2009 passed by the learned Additional Rent

Control Tribunal, (‗Tribunal') whereby the appeal RCT No. 39 of 2008,

filed by the Respondent/tenant was allowed and the Petitioner's eviction

petition under Section 14 (1) (a) of the Delhi Rent Control Act 1958 (‗DRC

Act') was dismissed.

2. The plea of the Petitioner in eviction petition was that the premises was

given on rent to the Respondent/tenant at a monthly rent of Rs. 715/-. The

Respondent/tenant was a chronic defaulter in the payment of rent and had

already been granted the benefit of making payment of the arrears of rent

under Section 14 (2) DRC Act by the Additional Rent Controller (ARC).

The Respondent/tenant had challenged the said order before the Tribunal.

However, the order was upheld with some partial modification with regard

to the arrears of rent.

3. In the eviction petition under Section 14 (1) (a) of the DRC Act the

Petitioner/landlord stated that the Respondent/tenant had defaulted in

making payment of rent for the months of February, March and April 2005.

According to him the rent for the said three consecutive months was neither

paid nor tendered by the Respondent/tenant. On 15th June 2005 a legal notice

was issued to the Respondent/tenant, to which a reply was sent on 2nd July

2005. The Petitioner/landlord in the eviction petition mentioned the fact that

the Respondent/tenant had filed an application under Section 27 DRC Act

for deposit of rent. The Petitioner/landlord had filed his objections in the

said application. On 5th August 2005 the learned ARC passed an order

allowing the petition under Section 27 DRC Act and granted the

Petitioner/landlord liberty to withdraw the rent deposited by the

Respondent/tenant without prejudice to the rights and objections of the

Petitioner/landlord.

4. The case of the Respondent/tenant was that payment of rent for the

aforementioned three months was made by cheques dated 10th March, 9th

April and 6th May 2005 each for a sum of Rs. 715/-. The Respondent/tenant

claimed that the cheques were sent to the landlord by courier but the

landlord had deliberately not encashed them. Consequently, the tenant had to

file an application under Section 27 of the DRC Act before the learned ARC

on 13th May 2005. The Respondent/tenant deposited before the learned ARC

on 30th May 2005 the arrears of rent for the said three consecutive months in

the sum of Rs. 2145/-. In his reply dated 2nd July 2005 to the landlord's legal

notice dated 15th June 2005, the tenant informed that the rent for the said

three months already stood deposited before the learned ARC.

5. The Petitioner/landlord filed his objections to the tenant's application

under Section 27 DRC Act for deposit of rent and prayed that the said

application should be dismissed. On 5th August 2005 the following order

was passed by the learned ARC in the said application:

―DR 127/05

05.8.2005

Present: Petitioner with counsel Respondent with counsel 5.8.05 P.O.A. On behalf of respondent filed. He has also filed objections along with certain documents. Copy supplied. Learned counsel for the Respondent has submitted that Respondent has no objection if the petition is allowed without prejudice to the rights of the Respondent and objections raised by him.

Heard. In view of the above, the Respondent is at liberty to withdraw the rent deposited by the Petitioner without prejudice to his rights and objections raised by him. The petition is disposed off accordingly. No order as to cost. File be consigned to the record room.

Sd/-

ARC, Delhi 5.8.05‖

6. It is stated that thereafter on 27th September 2005 the Petitioner withdrew

the said sum of Rs.2,145 that had been deposited before the learned ARC.

On 5th December 2005 the aforementioned eviction petition was filed by the

Petitioner under Section 14 (1) (a) of the DRC Act on the ground that the

Respondent/tenant had failed to pay or tender rent for three consecutive

months i.e. February, March and April 2005.

7. The learned ARC by the judgment dated 24th July 2007 allowed the

eviction petition and directed eviction of the Respondent from the premises.

The learned ARC agreed with the Petitioner/landlord that the deposit of the

arrears of rent in the court by the tenant, even with the permission of the

Court, did not absolve the tenant from the burden of establishing that the

rent for the three months in question was tendered by him to the landlord but

was refused by the landlord. It was held by the learned ARC that the

Petitioner had been able to establish that the Respondent had not paid the

entire arrears of rent within a period of two months of the service of the legal

notice as contemplated under Section14 (1) (a) DRC Act.

8. In the evidence led by the tenant he was unable to prove that he had sent

the cheques by courier and that there was a refusal on the part of the landlord

to receive the rent so tendered by the tenant. Since the tenant had actually

failed to show that he had tendered the rent to the Petitioner in accordance

with Section 14 (1) (a) of the DRC Act, the question of invoking Section 27

(1) DRC Act did not arise. Consequently it was concluded that the

Respondent had never sent any cheque to the Petitioner by way of courier

and the eviction petition was allowed.

9. Aggrieved by the above order the Respondent filed RCT No. 39 of 2008

before the Tribunal. The Tribunal held that withdrawal by the Petitioner/

landlord of the amount of rent deposited in the court of the learned ARC

resulted in the payment of rent for the three months and therefore, this wiped

out the default. Even otherwise under Section 28 (2) of the DRC Act, once

the landlord withdrew the arrears of rent deposited in the court, he could not

seek a decision on whether the claim made by the tenant about his tendering

the rent and the landlord refusing it was false.

10. Mr. Chetan Sharma, learned Senior counsel appearing for the Petitioner

submits that notwithstanding the fact that the Petitioner may have withdrawn

the amount deposited in the court by the tenant in an application under

Section 27 of the DRC Act, when an eviction petition was filed subsequently

by the landlord under Section 14 (1)(a) of the DRC Act, the tenant would

have to independently establish that he tendered or paid the rent which was

refused by landlord. He placed reliance upon the judgments of the Supreme

Court in Maiku v. Vilayat Hussain AIR 1986 SC 1645, Fakir Mohd.

(Dead) by LRs v. Sita Ram 2002 (1) RCR 91 as well as Madras High Court

in T. Gopalsamy v. R. Renganathan 2000 MLT 703, N. Janakiraman v.

C.B. Radhakrishnan 2002 (1) RCR 120 and. He referred to the concurrent

findings of the learned ARC as well as the Tribunal that the tenant's version

that he had sent the cheques by courier was not believable. Therefore, it was

not open to the tenant now to plead that deposit made by him in the court of

the learned ARC pursuant to an application under Section 27 of the DRC

Act should be treated as valid tender of the rent. Since the pre-condition for

filing the application under Section 27 of the DRC Act was non-existent, the

deposit of rent made pursuant thereto cannot be a valid tender in the eye of

law. He adds that the tenant is a chronic defaulter having already availed of

the benefit of Section 14 (2) of the DRC Act earlier. Therefore, no further

indulgence should be granted to him.

11. Appearing for the Respondent Mr. Rajeev K. Virmani, learned Senior

counsel points out that the sequence of events in the present case is

significant. The version of tenant that he tendered three cheques for the

months February, March and April 2005 to the landlord by cheque is not per

se unbelievable. He submits that even assuming it was, the fact remained

that on 13th May 2005, even before the landlord sent the legal notice, the

tenant had filed an application in the court of the learned ARC under Section

27 of the DRC Act. Pursuant thereto, on 30th May 2005 the tenant deposited

a sum of Rs. 2,145/- in the court of the learned ARC. This belied the case of

the landlord that the tenant had filed Section 27 application as a response to

the legal notice dated 15th June 2005 sent by the landlord. In response to the

said notice tenant on 2nd July 2005 sent a reply informing the landlord that

he had deposited the rent for the three months in the court. Thereafter the

proceedings of 5th August 2005 took place. The landlord did not contest the

Section 27 application. Instead he stated before the learned ARC that he

would have no objection if the petition was allowed, without prejudice to his

rights and objections. It is explained by Mr. Virmani that this statement

meant that the landlord was not accepting the tenant's version that the tent

had had tendered the rent which was refused by the landlord. The landlord

thereafter withdrew the rent from the court of the learned ARC on 27 th

September 2005. Mr. Virmani analysed the provisions of Sections 14 (1) (a),

14 (2), 15, 27 and 28 (2) of the DRC Act and submitted that any question of

default by the tenant in making payment of rent for the months of February,

March and April 2005 stood extinguished with the landlord withdrawing on

27th September 2005 the rent deposited from the court even before filing the

eviction petition. In fact the deposit of rent was made by the tenant even

before the landlord issued the legal notice. Consequently there was no cause

of action for the eviction petition filed under Section 14 (a) of the DRC Act

more than two months thereafter on 5th December 2005.

12. This Court has considered the above submissions. While it is true that

both the learned ARC as well as the Tribunal have disbelieved the tenant's

version of having sent three cheques by courier, the fact remains that the

landlord did withdraw the rent deposited by the tenant before the learned

ARC pursuant to the petition under Section 27 of the DRC Act. The

provisions of DRC Act with regard to wilful default are not in pari materia

with the rent control legislations in other States in relation to which the

decisions relied on by the learned Senior counsel for the Petitioner were

rendered. Section 14 (a) of the DRC Act reads as under:

―14. Protection of tenant against eviction.--(1) Notwithstanding anything to the contrary contained in any other law or contract, no order or decree for the recovery of possession of any premises shall be made by any court or Controller in favour of the landlord against a tenant:

Provided that the Controller may, on an application made to him in the prescribed manner, make an order for the recovery of possession of the premises on one or more of the following grounds only, namely:

(a) that the tenant has neither paid nor tendered the whole of the arrears of the rent legally recoverable from him within two months of the date on which a notice of demand for the arrears of rent has been served on him by the landlord in the manner provided in Section 106 of the Transfer of Property Act, 1882 (4 of 1882);

13. There are four distinct ingredients in Section 14 (1) (a) that require to be

established by the landlord before he can seek eviction. First, is the existence

of the relationship of landlord and tenant. In the instant case, there is no

dispute on this count. Second, the existence of arrears of rent legally

recoverable from the tenant and the third ingredient is the failure on the part

of the tenant to tender or make payment of rent. On both these aspects there

is a dispute since the tenant claimed that he had paid the three months' rent

by cheques which the landlord denied. This led to the tenant filing an

application under Section 27 of the DRC Act on 13th May 2005 and the

landlord issuing a legal notice on 15th June 2005. The fourth ingredient is the

receipt by the tenant of notice of demand about which again there is no

dispute. Therefore two of the four ingredients have to be established by the

landlord if he has to succeed.

14. Section 14 (2) DRC Act reads as under:

―14 (2) - No order for the recovery of possession of any premises shall be made on the ground specified in clause (a) of the proviso to sub-section (1) if the tenant makes payment or deposit as required by Section 15.

Provided that no tenant shall be entitled to the benefit under this sub-section, if having obtained such benefit once in respect of any premises, he again makes a default in the payment of rent of those premises for three consecutive months.‖

15. The above provision in turn refers to Section 15 (6) which states that if a

tenant makes payment or deposit as required by sub-section (1) or sub-

section (3), no order shall be made for the recovery of possession on the

ground of default in the payment of rent by the tenant. Where the tenant, as

in the instant case, has already been granted earlier the benefit of Section 14

(2) DRC Act, then in order to escape eviction he would have to show that in

fact there was n default committed by him in making payment of rent.

16. Even before the landlord could issue a notice to the tenant about the

arrears of rent on 15th June 2005, the tenant had on 13th May 2005 filed the

Section 27 application. Section 27 (5) reads as under:

―27 (5) - if at the time of filing the application under sub- section (4), but not after the expiry of thirty days from receiving the notice of deposit, the landlord or the person or persons claiming to be entitled to the rent complains or complain to the Controller that the statements in the tenant's application of the reasons and circumstances which led him to deposit the rent are untrue, the Controller, after giving the tenant an opportunity of being heard, may levy on the tenant a fine which may extent to an amount equal to two months' rent if the Controller is satisfied that the said statements were materially untrue and may order that a sum out of the fine realized be paid to the landlord as compensation.‖

17. In the present case, the landlord did appear on 5th August 2005 pursuant

to the notice issued by the learned ARC. By that time on 27 th May 2005 the

tenant had already deposited the three months' rent before the learned ARC

in an application under Section 27 DRC Act. When the case came up before

the learned ARC on 5th August 2005 it was open to the landlord to contest

the petition and seek to show that in fact no valid tender of rent was ever

made by the tenant and that by depositing the rent the tenant was not

absolved of showing that the ingredients of Section 27 (1) existed. Instead,

the Petitioner/landlord made a statement before the learned ARC that he

would have no objection to the Respondent/tenant's petition under Section

27 DRC Act being allowed. The Petitioner/landlord was further given liberty

by the learned ARC to withdraw the rent deposited without prejudice to his

rights and contentions.

18. If even at that stage it was not the intention of the landlord to treat the

rent deposited in Court as a valid tender, he need not have withdrawn it. He

could still have gone ahead with the petition under Section 14 (1) (a) DRC

Act. However, the landlord on 27th September 2005 chose to withdraw the

rent. It is only thereafter on 5th December 2005 he filed the eviction petition.

The answer to the question whether this amounts to a waiver by the landlord

of his right to protest the deposit of rent is in Section 28 of the DRC Act

which is significant as far as the present case is concerned. The said

provision reads as under:

"28. Time limit of making deposit and consequences of incorrect particulars in application for deposit - (1) No rent deposited under Section 27 shall be considered to have been validly deposited under that Section, unless the deposit is made within twenty-one days of the time referred to in Section 26 for payment of the rent.

(2) No such deposit shall be considered to have been validly made, if the tenant willfully makes any false statement in his application for depositing the rent, unless the landlord has withdrawn the amount deposited before the date of filing an application for the recovery of possession of the premises from the tenant.

(3) If the rent is deposited within the time mentioned in sub- section (1) and does not cease to be a valid deposit for the reason mentioned in sub-section (2), the deposit shall constitute payment of rent to the landlord, as if the amount deposited had been validly tendered.‖

19. It becomes straightway apparent that once the landlord withdraws the

amount deposited by the tenant in the court even prior to filing the eviction

petition, then it will not be open to the landlord to turn round and object that

tender of the rent made by the tenant was based on false premises and

therefore, was not a valid tender. By his act of withdrawing the rent

deposited by the tenant in court prior to filing an eviction petition, the

landlord in the instant case has lost the right to question the claim of the

tenant that he had validly tendered the rent which had been refused by the

landlord. This Court affirms the decision of the learned Tribunal in this

regard.

20. None of the decisions cited by Mr. Chetan Sharma, learned Senior

counsel appearing for the Petitioner help the case of the Petitioner. Since

considerable reliance was placed upon the decision of the Supreme Court in

Maiku v. Vilayat Hussain through LRs this Court has examined the said

decision at some length. There the eviction proceedings were under the U.P.

(Temporary) Control of Rent and Eviction Act 1947 (‗UP Act'). The

question that arose in the said case was whether ―deposit of arrears of rent

under Section 7 C of the UP Act will save the tenant from the penalty of

being evicted on account of non-payment of rent.‖ The further question that

arose was ―whether the order granting permission to the tenant to deposit the

arrears of rent in Court is sacrosanct and cannot be challenged in a regular

suit for eviction.‖ It was held in para 9 of the said judgment as under:

―9. Section 7C permits a tenant to deposit the arrears of rent in court only under two conditions : (1) when the landlord refuses to accept any rent lawfully paid to him by the tenant in respect of any accommodation, and (ii) where any bonafide doubt or

dispute has arisen as to the person who was entitled to receive any rent referred to in Sub-section (1) in respect of any accommodation. If the deposit of arrears of rent was a valid deposit in accordance with the requirements of Section 7C certainly it will amount to payment to the landlord and the tenant will be absolved from the liability of being evicted. But if the Munsif had only to accept the application and accord permission to the tenant to deposit the arrears in court merely on the basis that necessary allegations in the application as required by Section 7C had been made, the court trying the suit for eviction cannot be precluded from enquiring about the validity of the permission under Section 7C.

21. The facts of the present case are distinctly different since here the

landlord conceded to the tenant's petition under Section 27 DRC Act being

allowed and also withdrew the rent deposited. Secondly, it is not clear from

the above judgment whether the U.P. Act contained a provision equivalent to

Section 28 (2) of the DRC Act. While the deposit under Section 7 C of the

U.P. Act may not relieve the tenant in that State of the burden of showing

that he had validly tendered the rent which was refused by the landlord, the

withdrawal of such deposit by a landlord in Delhi will be an estoppel against

him under Section 28 (2) DRC Act. The decision in Maiko v. Vilayat

Hussain will not apply to the present facts of the case.

22. In Fakir Mohd. (Dead) by LRs v. Sita Ram the Supreme Court was

considering a case that arose under the Rajasthan Premises (Control of Rent