Madras High Court
G.Shanthilal Transport Company vs / on 1 December, 2023
CRP(MD)No.753 of 2019
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
RESERVED ON : 17.11.2023
PRONOUNCED ON : 01.12.2023
CORAM
THE HONOURABLE MR.JUSTICE P.B. BALAJI
C.R.P.(MD)No.753 of 2019
and
C.M.P.(MD)No.5056 of 2019
G.Shanthilal Transport Company,
Rep. By its Partner,
Anil G.Vijan. ...Petitioner
/Vs./
K.Sankar ...Respondent
PRAYER:- Petition - filed under Section 25 of the Tamil Nadu Building (Lease
and Rent Control) Act, 1960, to set aside the judgment and decree dated
12.09.2018 made in RCA No.54 of 2014 on the file of the Rent Control
Appellate Authority (Sub Court), Madurai, confirming the order and decreetal
order dated 02.06.2014 made in RCOP No.149 of 1992 on the file of the
Additional Rent Controller, (Additional District Munsif Court), Madurai Town.
For Petitioner : Ms.J.Anandhavalli
For Respondent : Mr.L.Shaji Chellan
https://www.mhc.tn.gov.in/judis
1/10
CRP(MD)No.753 of 2019
ORDER
The tenant is the revision petitioner. The respondent, as landlord, filed
RCOP No.149 of 2014 for fixation of fair rent under Section 4 of the Tamil
Nadu Buildings (Lease and Rent Control) Act, Act 18 of 1960. The parties are
described as landlord and tenant.
2. The brief facts of the petition in RCOP No.149 of 2014 seeking
fixation of fair rent are as follows:-
(i) The premises belongs to the landlord and the tenant was running a
lorry office on a monthly rent of Rs.700/- under a lease with the landlord. The
petition premises is situated in a prime locality in Madurai, very close to
Meenakshi Amman Temple, Railway Station and Periyar Bus-Stand. The
market value of site in the locality is not less than Rs.18,00,000/-. The fair rent
that would be payable by the tenant would be Rs.13,000/- per month.
(ii) The said RCOP was resisted by the tenant stating that the property is
situated in a very congested area and the value as claimed by the landlord is
highly exaggerated. Moreover, the building is very old and dilapidated and of
nil value. The petition has been filed only to vacate the tenant from the petition
premises.
(iii) Initially, the Rent Controller, after enquiry, fixed the fair rent at Rs.
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15,870/- per month. In appeal filed by the tenant, the same was reduced to Rs.
12,650/- per month. However, when the matter was challenged by way of
revision before this Court, the matter was remanded back to the Rent Controller,
as the Courts had adopted the guideline value instead of market value, to arrive
at fair rent. After remand, the Rent Controller fixed the fair rent at Rs.12,740/-,
which came to be confirmed by the Appellate Authority. It is aggrieved by the
said concurrent findings of the Rent Controller and the Appellate Authority that
the present revision has been preferred.
3. The main grounds challenging the order fixing the fair rent are that the
Courts had erroneously considered Exs.P1 & P2, which are not only situated far
away from the petition premises, but also pertain to a small extent of land and
cannot be compared to the petition premises. Further it is also contended that
Ex.R1 sale deed was pertaining to a property situated very near to the petition
premises and the Courts below have not taken the same into account while
fixing the market value of the petition premises.
4. The further contention of the tenant is that the Courts below
erroneously fixed the age of the building as 45 years. It is the specific case of
the tenant that the building was easily more than 100 years old. The evidence of
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PW1 also clearly pointed out the fact that the building was constructed during
the King Nayakkar's rule in Madurai and was certainly not of any recent origin.
5. I have heard the learned counsel for the petitioner / tenant and the
learned counsel appearing for the respondent / landlord. I have also perused the
order of the learned Rent Controller and and the judgment of the Appellate
Authority and also the oral and documentary evidence adduced by the parties.
6. Admittedly, there is no dispute with regard to tenancy. The parties
also admit to the fact that the contractual rent was Rs.700/-. The petitioner's
grievance is two fold:- (i) the Courts below have erred in fixing the market
value of the property by placing reliance on Exs.P1 & P2, ignoring Ex.R1,
which was more proximate and relevant, insofar as the petition premises is
concerned. (ii) The age of the building was fixed at 45 years, whereas it is the
specific contention of the tenant that the building is easily more than 100 years
old.
7. Insofar as the age of the building is concerned, in the RCOP
proceedings, the landlord has stated in the petition filed by him that the age of
the building is more than 42 years old. It is the specific contention of the
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respondent that the building is very old and if depreciation is calculated, the
value will be nil. The learned Rent Controller has not even discussed the
contention with regard to the age of the building and has blindly fxed the age of
the building as 45 years. The Appellate Authority has also, without any
independent discussion, merely adopted the age of the building as 45 years.
8. When the landlord approaches the Court seeking fixation of the fair
rent, it is the burden of the landlord to establish the age of the building. The age
of the building is one of the key factors that will decide the value of the
building, because the Act stipulates that fair rent will be fixed based on the
value of the building and market value of the site. The rate of the depreciation is
another factor which depends on the age of the building. Unfortunately, both
the learned Rent Controller as well as the learned appellate authority have,
without any discussion whatsoever taken the age of the building as 45 years.
9. Even though the landlord has stated in his petition that the building is
42 years, there is absolutely no evidence forthcoming from the landlord to
establish the correct age of the building. The landlord is the best person to
prove the age of the building because he can either produce the sanction plan or
the sale deed/s in connection with the purchase of the building, which will
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clearly and clinchingly show the correct age of the building. Unfortunately, the
landlord has not chosen to produce any evidence to establish the age of the
building. On the contrary, the tenant has taken a specific plea that the building
is very old and if depreciation is taken into account, the building value will be
nil.
10. I also find a suggestion put to PW1 during cross examination that the
building is more than 200 years old. The age of the building is something
which the tenant cannot prove or establish by direct or primary evidence. When
the tenant disputes the age of the building stated by the landlord, then it is the
burden of the landlord to bring satisfactory or reliable evidence before the Rent
Controller and establish the age of the building. Therefore, I am constrained to
interfere with the concurrent findings of the Rent Controller and the appellate
authority that the age of the building is 45 years.
11. However, considering the stand taken by the tenant that the age of the
building is more than 200 years old, from the available evidence on record and
also considering the stand taken by the tenant in the pleadings as well as
evidence and the admission of the PW1 with regard to the nature of construction
which was done only in ancient times, I proceed to fix the age of the building as
100 years.
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12. Coming to the crucial point, namely, market value of the site on
which the building is constructed, Exs.P1 & P2 are sale deeds which have been
marked by the landlord to establish the market value of the petition premises.
Per contra, the tenant has exhibited Ex.R1 sale deed to show that the market
value is lower than what is claimed by the landlord.
13. The appellate authority has applied his mind to these three
documents and after discussing the contentions and objections to the said
document, has confirmed the findings of the Rent Controller. The appellate
authority has also specifically discussed Ex.R1 and found that the document
was undervalued and deficit stamp duty was also paid and therefore, rightly
came to the conclusion that no reliance could be placed on Ex.R1.
14. While rejecting Ex.R1, the appellate authority has noticed that the
property conveyed under Ex.P1 was 35 sq.ft., and the property covered under
Ex.P2 was in respect of 370.5 sq.ft., and proceeded to the square foot value at
Rs.415/-. The appellate authority arrived the market value of the land/site at
Rs.10,79,000/-, considering the fact that the premises was of an extent of 2600
sq.ft. of land. The Courts below have not blindly adopted the market value as
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exhibited in Ex.P1 & P2. On the other hand, the appellate authority has arrived
at value of Rs.415/- per sq.foot., contrary to Rs.425/- under Ex.P1 and
Rs.607.28/- under Ex.P2. Therefore, I do not find any ground to interfere with
the findings of the Courts below in fixing the market value.
15. Considering the age of the building being less than 100 years, the
cost of construction of the building would stand virtually nullified and no
amount can be added to the market value on account of cost of construction of
the building as at 1% depreciation for 100 years would wipe out the entire cost
by the building itself. Therefore, the fair rent is modified as hereunder:-
Rs.10,79,000 / 12% = Rs.1,29,480 (per year) / 12 = Rs.10,790/- per month.
(Market Value of site * 12% for non-residential premises / 12 months)
16. In the result, this civil revision petition is partly allowed and the fair
rent fixed by the Rent Controller and confirmed by the appellate authority at
Rs.12,740/- stands modified to Rs.10,790/- per month.
01.12.2023
NCC : Yes/No
Internet :Yes/No
Index :Yes/No
sm
https://www.mhc.tn.gov.in/judis
TO:-
1.The Rent Control Appellate Authority (Sub Court), Madurai.
2.The Additional Rent Controller,
(Additional District Munsif Court), Madurai Town.
3.The Section Officer,
VR Section,
Madurai Bench of Madras High Court,
Madurai.
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P.B. BALAJI, J.
sm
Order made in
Dated:
01.12.2023
https://www.mhc.tn.gov.in/judis
