Lalit Madhan vs Pramod Kalra
2014 Latest Caselaw 200 Del

          *IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                    Date of decision: 10th January, 2014.

+                                RFA No.350/2013

       LALIT MADHAN                                       ..... Appellant
                   Through:           Mr. Raman Kapur, Sr. Adv. with Mr.
                                      Aviral Tiwari, Adv.

                                   Versus

    PRAMOD KALRA                            ..... Respondent
                 Through: Ms. Purnima Maheshwari, Adv.
CORAM :-
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW

RAJIV SAHAI ENDLAW, J.

1. The appeal impugns the judgment and decree (dated 6th April, 2013 of

the Court of the Additional District Judge (ADJ) (Central-07), Tis Hazari

Courts, Delhi in Civil Suit No.116/2010 filed by the

respondent/plaintiff/landlord against the appellant/defendant/tenant) (i) of

ejectment of the appellant/defendant/tenant from Flat No.908, 9th Floor,

Hemkunt Tower, Rajendra Place, New Delhi; (ii) for recovery from the

appellant/defendant/tenant of interest @ 12% per annum on the rent of

Rs.2,645/- per month from 8th July, 2007 to 26th June, 2010 calculated for

the period from 24th May, 2010 to 27th July, 2011; and, (iii) for recovery

from the appellant/defendant/tenant of mesne profits/damages for use and

occupation of Rs.5,725/- per month (less the amount paid during the

pendency of the suit to the respondent/plaintiff/landlord and towards

maintenance charges) from 27th June, 2010, till the date of delivery of

possession.

2. The respondent/plaintiff/landlord had instituted the suit from which

this appeal, arises inter alia pleading, that the appellant/defendant/tenant was

a tenant under the respondent/plaintiff/landlord in the flat aforesaid; that the

rent of the flat was in excess of Rs.3,500/- per month and the provisions of

the Delhi Rent Control Act, 1958 thus did not apply thereto; that the

appellant/defendant/tenant after the determination of the tenancy was in

unauthorized use and occupation thereof.

3. The law with respect to such disputes, on each and every aspect, is by

and large well settled in the plethora of such cases which have come up

before the Courts.

4. The appeal came up before this Court first on 30th July, 2013. The

only argument urged by the senior counsel for the appellant/defendant/tenant

was that though the appellant/defendant/tenant had before the Trial Court

controverted that the rent of the premises was in excess of Rs.3,500/- per

month but the learned ADJ had wrongly held the rent to be in excess of

Rs.3,500/- per month. It was the contention of the senior counsel for the

appellant/defendant/tenant, i) that the admitted position was that the

appellant/defendant/tenant for the said flat was paying a rent of Rs.2,645/-

per month to the respondent/plaintiff/landlord and a sum of Rs.1,224/-

towards maintenance charges to the Welfare Association of the Owners &

Occupants of the multistoried building in which the said flat is situated, on

account of maintenance charges; ii) that the learned ADJ however has

erroneously held the said maintenance charges of Rs.1,224/- per month to be

part of rent and by adding the same to the monthly rent of Rs.2,645/-, held

the rent to be Rs.3,869/- per month, taking the premises outside the purview

of the Rent Act; iii) that though the learned ADJ in the impugned judgment,

to hold the maintenance charges to be part of rent had relied upon the

judgment of the Supreme Court in Abdul Kader Vs. G.D. Govindaraj (2002)

5 SCC 51 but there was a dichotomy of views in this respect in the

orders/judgments of this Court in RFA No.40/2012 and in RSA

No.251/2008. On the said contention of the senior counsel for the

appellant/defendant/tenant, notice of the appeal was issued and the Trial

Court record as well as the files of RFA No.40/2012 and RSA No.251/2008

requisitioned and subject to the appellant/defendant/tenant depositing the

entire arrears of mesne profits/damages together with interest thereon in this

Court, execution was stayed.

5. In compliance with the aforesaid, a sum of Rs.1,02,000/- has been

deposited in this Court.

6. After notice of the appeal was served on the

respondent/plaintiff/landlord, the appeal was admitted for hearing and

considering the short question involved in the appeal, with the consent of the

counsels, the appeal was finally heard and judgment reserved, giving liberty

to the counsels to file synopsis of submissions with additional judgments, if

any relied upon. Both counsels have filed such synopsis with copies of the

judgments and which have also been considered.

7. The limited question as aforesaid is, whether the charges payable by a

tenant for provision of various common amenities/services in a multistoried

building in which the tenancy premises are situated is to be part of rent or

not. No other challenge has been urged by the senior counsel for the

appellant/defendant/tenant at the time of final hearing also.

8. Before dealing with the respective contentions, I may record that on

receipt of files of RFA No.40/2012 and RSA No.251/2008, it is found that

the judgments in both, take the same view i.e. against the

appellant/defendant/tenant and there is no dichotomy of views of this Court

as was earlier contended on behalf of the appellant/defendant/tenant. The

senior counsel for the appellant/defendant/tenant has explained that he had

urged so on hearsay and without examining the said judgments which are

unreported.

9. Before taking up the contentions of the senior counsel for the

appellant/defendant/tenant, it is deemed appropriate to refer to the judgments

relied upon by the counsel for the respondent/plaintiff/landlord to contend

that the said question is no longer res integra; she has referred to:

(i) West Coast Paper Mills Ltd. Vs. Asha Kapoor (2007) 97 DRJ

548 where a Division Bench of this Court held, that the word „rent‟

included not only what is originally described as rent in the

Agreement but also those payments which are made for amenities

provided by the landlord under the Agreement and rent includes all

payments agreed to be paid by the tenant to his landlord for use and

occupation not only of the building but also for furnishing, electrical

installations and other amenities; the payment towards maintenance

charges of the premises rented out and also for providing amenities to

the tenant, is rent; accordingly, the charges payable in that case by the

tenant to the landlord for furniture and fixtures were held to be part of

rent and the premises were thus held to be outside the purview of the

Rent Act;

(ii) Inder Vijay Singh Vs. NDMC (1995) Rajdhani Law Reporter

254, where a Division Bench of this Court included the payment of

hire charges of air conditioners in rent for the purposes of determining

the rateable value and house tax of the premises;

(iii) Sewa International Fashions Vs. Smt. Suman Kathpalia 82

(1999) DLT 104 where the charges payable by the tenant to the

landlord as maintenance charges were held to come within the ambit

of the expression „rent‟ and so computed, the premises were held to be

outside the ambit of the Rent Act;

(iv) judgment dated 18th January, 2012 in RFA No.40/2012 supra

titled M/s. Sewa International Fashions Vs. Meenakshi Anand

where also by computing maintenance charges to be rent, the premises

were held to be outside the ambit of the Rent Act;

(v) judgment dated 28th April, 2011 in RSA No.251/2008 supra

titled United India Insurance Co. Ltd. Vs. Smt. Anup Kaur where

also the maintenance charges were held to be part of rent and the

tenancy premises were thus held outside the ambit of the Rent Act;

(vi) Standard Pharmaceuticals Ltd. Vs. Gyan Chand Jain 97

(2002) DLT 290 where service charges payable by the tenant to the

landlord were held to be part of the rent and accordingly the premises

were held outside the ambit of the Rent Act;

(vii) Annick Chaymotty @ Devayani Vs. Prem Mohini Mehra 95

(2002) DLT 312 where the amount besides rent being paid by the

tenant to the landlord towards additional facilities provided in the

premises, was held to be included in the rent and the premises were

accordingly held outside the Rent Act.

10. The senior counsel for the appellant/defendant/tenant has argued:

(a) that in Sewa International Fashions Vs. Smt. Suman

Kathpalia, the maintenance charges were being paid by the tenant to

the landlord only; that in the present case, the maintenance charges

have always been paid by the appellant/defendant/tenant directly to

the maintenance agency of the building and have never been paid by

the appellant/defendant/tenant to the respondent/plaintiff/landlord;

(b) that such maintenance charges are at par with the electricity and

water charges with respect to the premises and which can vary from

month to month and it will be incongruous to hold that if the tenant

uses more water/electricity and the charges levied therefor make the

rent of the premises in excess of Rs.3,500/- per month, the premises in

that month would be outside the purview of the Rent Act and if the

tenant uses less electricity/water so that the charges therefor together

with rent payable to the landlord are less than Rs.3,500/-, the premises

would be within the purview of the Rent Act;

(c) that in the lease agreement between the parties in the present

case proved before the Trial Court as Ex.PW1/C (also Ex.PW2/9) also

the maintenance charges at the time of letting on 9 th February, 1981

were of 25p per sq. ft. per month and the appellant/defendant/tenant

was liable to also pay increase therein on the basis of actual increase

in the maintenance charges of the building;

(d) under the aforesaid Lease Agreement, the

appellant/defendant/tenant besides the lease rent payable to the

respondent/plaintiff/landlord had agreed to pay charges for

consumption of electricity and water to the municipal authorities and

maintenance charges to the maintenance agency of the building;

(e) that the said maintenance services were/are not being provided

by the respondent/plaintiff/landlord but by the maintenance agency

and thus the payment of maintenance charges to the maintenance

agency cannot be said to be on behalf of the

respondent/plaintiff/landlord;

(f) that the respondent/plaintiff/landlord, in the petition for eviction

under the Rent Act filed against the appellant/defendant/tenant prior

to the institution of the suit from which this appeal arises had

mentioned the rent as Rs.2,645/- only;

(g) that at best rent can be inclusive of amounts for whatsoever

additional services provided by the landlord and cannot include the

amount paid by the tenant for services provided by others and not by

the landlord;

(h) that in the judgment of this Court in Sewa International

Fashions Vs. Smt. Suman Kathpalia the maintenance charges were

held to be part of the rent because it was so accepted by the tenant

before the Trial Court and the said judgment cannot thus be held to be

a precedent on the said aspect;

(i) similarly in United India Insurance Co. Ltd. supra also, the

maintenance charges were held to be part of rent owing to the

admission of the tenant;

(j) on the contrary the appellant/defendant/tenant in the present

case in his written statement had expressly controverted that the

maintenance charges were part of the rent;

(k) that the acceptance in the impugned judgment of the contention

of the respondent/plaintiff/landlord that the appellant/defendant/tenant

was directed to pay the maintenance charges directly to the

maintenance agency on behalf of the respondent/plaintiff/landlord for

the reason of the respondent/plaintiff/landlord staying in USA is

contrary to the pleading including in the earlier proceedings between

the parties;

(l) that the rate of maintenance charges, just like the electricity and

water charges is variable, being based on actuals;

(m) attention is invited to the affidavit dated 26th April, 2004 by

way of examination-in-chief of the respondent/plaintiff/landlord in the

proceedings under the Rent Act before the Rent Controller (instituted

prior to the institution of the suit from which this appeal arises)

deposing the then rent of the premises to be Rs.2,091/- excluding

electricity, water and maintenance charges;

(n) that even if the flat is lying locked or is in occupation of the

landlord, the maintenance charges are still payable to the maintenance

agency of the building;

(o) increase or decrease in maintenance charges is by the

maintenance agency and not at the will of the landlord;

(p) attention is invited to the judgment of the Division Bench of

this Court in CIT Vs. DLF Office Developers MANU/DE/3568/12

(DB) holding the maintenance charges payable to the maintenance

agency to be not rent and not assessable to tax as income in the hands

of the landlord; and,

(q) attention is invited to Mohammad Ahmad Vs. Atma Ram

Chauhan (2011) 7 SCC 755 to contend that landlords should get

actual rent out of which nothing would be deductible and, property

tax, water tax, maintenance charges and electricity charges shall be

payable only by the tenant.

11. The counsel for the respondent/plaintiff/landlord has also invited

attention to the receipts issued by the maintenance agency of receipt of

maintenance charges in the name of the respondent/plaintiff/landlord

"through tenant". Attention is also invited to the written statement dated 30th

October, 2003 of the appellant/defendant/tenant to the petition for eviction

under the Rent Act earlier filed by the respondent/plaintiff/landlord, where

appellant/defendant/tenant admitted payment of maintenance charges "for

and on behalf of" the respondent/plaintiff/landlord. Attention in this regard

is also invited to the Lease Agreement to contend that the payment of

maintenance charges by the appellant/defendant/tenant, though directly to

the maintenance agency, is for and on behalf of the respondent/plaintiff/

landlord.

12. I have considered the rival contentions.

13. Though the senior counsel for the appellant/defendant/tenant has in

support of the plea of the maintenance charges being not part of rent raised

certain arguments which appear to have been not raised in the judgments

supra holding maintenance charges to be „rent‟ and which arguments have

not been adjudicated in the said judgments but considering the consistent

view which this Court has taken, holding the maintenance charges to be part

of rent and also for the reason,

(a) that the subject premises are commercial in nature and the

appellant/defendant/tenant is occupying them for commercial

purposes;

(b) the appellant/defendant/tenant is carrying on business in the

name and style of M/s. Saraswati Construction Company and

had taken the said premises on rent from the

respondent/plaintiff/landlord as proprietor of the said M/s.

Saraswati Construction Company;

(c) that though the appellant/defendant/tenant had taken the

premises as far back as in February, 1981 at the then rent of

Rs.2,091/- per month for a period of three years with right of

renewal of lease for a further period of three years on

enhancement of rent by 15% over the last paid rent but has

continued in occupation of the premises of the

respondent/plaintiff/landlord instead of for three/six years, for

32 years, without any substantial increase in rent and without

even increasing the rent by 15% every three years to which he

had agreed, to his own commercial benefit and to the grave

prejudice of the respondent/plaintiff/landlord;

(d) that if the appellant/defendant/tenant in accordance with what

he had agreed, increased the rent by 15% every three years, the

rent in any case would have been more than Rs.3,500/- per

month and the premises would have been outside the purview

of the Rent Act;

(e) that the ground situation prevalent when the Rent Laws were

legislated have over the years drastically changed, with the

tenant particularly in this case being no longer an underdog or

under privileged in need of protection;

I do not consider this to be a fit case for referring the matter to a larger

Bench for reconsideration of the consistent view of this Court holding the

maintenance charges to be part of rent.

14. Else, following the consistent view of this Court (and which cannot be

on admission, being on a jurisdictional fact), there is no merit in the only

argument urged and the judgment of the Trial Court is found to be in

consonance with the law laid down by this Court.

15. The appeal is therefore dismissed. No costs.

16. Decree sheet be prepared.

17. The amounts aforesaid deposited by the appellant/defendant/tenant in

this Court together with interest if any accrued thereon be forthwith released

to the respondent/plaintiff/landlord and the files of RFA No.40/2012 and

RSA No.251/2008 requisitioned, be returned.

RAJIV SAHAI ENDLAW, J.

JANUARY 10, 2014 bs/pp