Full Judgment Text
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CASE NO.:
Appeal (civil) 3294-3295 of 2005
PETITIONER:
Ajai Agarwal & Ors.
RESPONDENT:
Har Govind Prasad Singhal & Ors.
DATE OF JUDGMENT: 08/11/2005
BENCH:
Ashok Bhan & Altamas Kabir
JUDGMENT:
J U D G M E N T
ALTAMAS KABIR,J.
The appellants are the legal heirs of the respondent-
tenant and the respondents are the landlord-plaintiffs.
One Jagdish Prasad, the father of the appellants in these
two appeals was granted a tenancy of a shop room situated at
Mohalla Bhoop Singh, Kasba Jaspur, Distrtrict Nainital by the
Respondents-plaintiffs at an agreed rent of Rs.600/- per year.
Since the shop room was in a dilapidated condition, the tenant
requested the landlord to get the shop renovated and to fix a
shutter in the shop but the landlord did not agree to such a
proposal and asked the tenant to get the shop repaired at his
own costs and consequently increased the rent to Rs.1,200/- per
year. It is the case of the tenant that at the relevant time the
tenant fell ill and could neither repair the shop nor fix the
shutter as agreed till the year 1989 but the landlord insisted on
payment of the increased rent at the rate of Rs.1,200/- per year
since 1986. According to the tenant, the increased rent was to
be paid for the improvement in the shop room but since the
repair work could not be done till 1989, the landlords agreed to
receive rent at the rate of Rs.75/- per month instead of
RS.100/- per month. However, once the shop was renovated
and the shutter was fixed, the tenant paid the rents at the
enhanced rate of Rs.1,200/- per year.
On 21.5.1992, the landlord-respondents gave notice
stating that the rent had not been paid from the month of
October 1988 and demanded rent at the rate of Rs.200/- per
month from 1.4.1989 and thereafter at the rate of Rs.400/- per
month from 1.1.1990. The tenant duly replied to the said
notice on 20.6.1992 denying that any such enhancement had
been agreed to by him and also indicated that the rents had not
been paid as the landlord had himself refused to accept the
same. The tenants thereupon tendered the rent of Rs.4,950/- to
the landlord by money order at the rate of Rs.100/- per month,
including house tax, since October, 1988. The landlord,
however, refused to accept the same. On 24.4.1996, the
landlord-respondents filed a suit for recovery of arrears of rent
amounting to Rs.14,500/- and for eviction of the tenant from the
tenanted premises. The amount claimed by the landlord-
respondents towards arrears of rent was calculated on the
basis that that the monthly rents were in arrears at the rate of
Rs.200/- per month from February, 1989 and at the rate of
Rs.400/- per month from January 1990. The court of Small
Causes (Senior Division), Nainital, decreed the suit upon
accepting the case made out by the landlord-plaintiffs regarding
the purported agreement for enhancement of the rents at the
enhanced rate.
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Aggrieved by the judgment and order of the trial court,
the tenant filed a revision petition No.34/1996 which was also
dismissed by the court of Special Judge (CBI)/Addl.District
Judge, Nainital on 13.8.1999.
Aggrieved by the aforesaid judgments and orders, the
present appellants who had succeeded to the tenancy as the
legal heirs of the tenant filed a Civil Writ Petition No.36462/99
before the High Court of Allahabad which after the creation of
the Uttaranchal High Court stood transferred to the High Court of
Uttaranchal and renumbered as Writ Petition No.
4053(M/S)/2001.
Before the High Court it was sought to be urged on behalf
of the appellants-tenant that in the absence of any written
agreement the provisions of Section 16 (10) of the Uttar
Pradesh Urban Buildings (Regulation of Letting, Rent and
Eviction) Act, 1972 (hereinafter referred to as ’the Act’) did not
provide for enhancement of rent by an oral agreement. It was
sought to be urged that the case as made out on behalf of the
landlord-respondents regarding the alleged agreement to
enhance the rents periodically was not borne out by the
materials on record and both the trial court and the revisional
court had erred in accepting the said story as made out by the
landlord in the absence of any written evidence of such
agreement alleged to have been arrived at between the parties.
It was sought to be urged that the courts below had erred
in relying on the uncorroborated evidence of the landlord in
arriving at a decision that such an agreement had been entered
into and was subsisting between the parties.
A learned single Judge of the Uttaranchal High Court
however, affirmed the findings of the courts below regarding the
purported agreement between the parties for periodical
enhancement of rent and concluded that the tenant was in
arrears in payment of rent, having failed to pay the same at the
enhanced rates. The learned Judge held that notwithstanding
the deposit of Rs.4,950/- by the tenant, the tenant would not be
entitled to the benefit of Section 20 (4) of the Act and
accordingly dismissed the writ petition.
The writ petitioners thereafter filed a Review Petition No.
9082/2003 which was also dismissed by the learned single Judge
of the Uttaranchal High Court by his order dated 4.12.2003.
These appeals arise out of two Special Leave Petitions filed
by the appellants challenging both the final orders dated
5.9.2003 and 4.12.2003 passed by the learned single Judge of
the Uttaranchal High Court dismissing the civil writ petition and
the subsequent review petition.
On behalf of the appellants it was reiterated that initially it
had been decided that the rent for the shop room would be
Rs.600/- per year and that upon repairs being effected to the
shop room and the fixing of a shutter the rent would be
increased to Rs.100/- per month. It was reiterated that since
the landlord had not effected the repairs or fixed the shutter in
the shop room the tenant ultimately was compelled to undertake
the work himself though the landlord claimed the enhanced rent
at the rate of Rs.100/- per month after such repairs and
renovation. However, since the tenant had been compelled to
effect the repairs and fix the shutter himself and had to bear
the expenses for the same, the landlord agreed to accept rents
at the rate of Rs.75/- per month and thereafter at the rate of
Rs.100/- per month. It was also urged that the tenant did not
consent to any further increase in the rent and except for the
oral statement of the landlord, there is no other evidence on
record to prove that the tenant had consented to any further
increase of the rents. It was urged that in the absence of such
evidence the findings recorded by the courts below were based
on assumption and were perverse.
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It was submitted that in the absence of any documentary
evidence as against the uncorroborated evidence of the landlord
alone, all the courts below, including the High Court at
Uttaranchal, had erred in coming to the finding that the parties
had agreed to periodical enhancement of rent and that the
tenant having failed to pay the rents at the enhanced rates was
liable to be evicted from the tenanted shop room.
The submissions made on behalf of the appellants was
strongly opposed on behalf of the landlord-respondents by
Mr.Dinesh Dwivedi, learned senior advocate, who contended that
all the courts below had concurrently come to the finding
regarding the existence of an agreement between the parties for
periodical enhancement of the rents, which ought not to be
interfered with by this Court at the final stage of the
proceedings. It was also sought to be urged that the
presumptive rent indicated in Section 16 (10) of the Act
contemplated fixation of such rent subject to any agreement in
writing between the parties or to any subsequent determination
of the standard rent after formal inquiry under Section 9. It was
sought to be contended that the said provision would indicate
that enhancement of rent could also be done without any
agreement in writing between the parties.
It was then contended that since the appellants had failed
to pay the rents at the enhanced rate as agreed upon between
the parties, the courts below had rightly held the appellants to
be in arrears in payment of the monthly rents and was not,
therefore, entitled to the benefit of Section 20 (4) of the Act
which reads as under:-
"20. Bar of suit for eviction of tenant except on
specified grounds.
(1) \005\005\005\005\005.
(2) \005\005\005\005\005.
(3) .\005\005\005\005..
(4) In any suit for eviction on the ground
mentioned in clause (a) of sub-section (2), if at
the first hearing of the suit the tenant
unconditionally pays or tenders to the landlord
or deposits in Court the entire amount of rent
and damages for use and occupation of the
building due from him (such damages for use
and occupation being calculated at the same
rate as rent) together with interest thereon at
the rate of nine per cent per annum and the
landlord’s costs of the suit in respect thereof,
after deducting therefrom any amount already
deposited by the tenant under sub-section (1)
of Section 30, the Court may, in lieu of passing
a decree for eviction on that ground, pass an
order relieving the tenant against his liability
for eviction on that ground:
Provided that nothing in this sub-section shall
apply in relation to a tenant who or any
member of whose family has built or has
otherwise acquired in a vacant state, or has
got vacated after acquisition, any residential
building in the same city, municipality, notified
area or town area.
Explanation.\027For the purposes of this sub-
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section\027
(a) the expression ’first hearing’ means the
first date for any step or proceeding
mentioned in the summons served on
the defendant;
(b) the expression ’cost of the suit’ includes
one-half of the amount of counsel’s fee
taxable for a contested suit."
It was also contended that, in any event, the appellants
had not even deposited the amount of Rs.4,950/- accepted by
the tenant to be the amount in arrears of rent, within the time
contemplated in Explanation (a) to sub-section (4) of Section 20
of the Act. It was urged that even if the story of periodical
enhancement of rents was discarded, the appellants would still
not be entitled to the protection under the aforesaid provision
since the admitted deposit had also been made beyond the time
prescribed.
In this regard, the decisions of this Court in the case of
Rakesh Wadhawan & Ors. vs. Jagdamba Industrial Corporation
& Ors., (2002) 5 SCC 440, Ashok Kumar & Ors. vs. Rishi Ram &
Ors., (2002) 5 SCC 641, Mam Chand Pal vs. Shanti Agarwal
(Smt.), (2002) 3 SCC 49 and Sudershan Devi & Anr. vs.
Sushila Devi & Anr., (1999) 8 SCC 31 were referred to by the
parties for the purpose of interpretation of the expression "first
hearing of the suit" used in Section 20 (4) of the Act.
On behalf of the landlord, it was also sought to be urged
that, in any event, the landlord would be entitled to the benefit
of Section 6 of the Act since admittedly improvements had been
effected to the tenanted shop.
Mr.Dwivedi submitted that the appellants had not made
out any case which called for interference by this Court with the
findings and orders of the courts below and the civil appeals
were liable to be dismissed.
On a careful consideration of the submissions made on
behalf of the respective parties, what strikes us as unreasonable
is the reliance placed by the courts below on the
uncorroborated evidence of the landlord alone, in arriving at a
conclusion that the parties had, in fact, agreed to periodical
enhancement of the monthly rent for the shop room in question.
There is no other evidence of the alleged agreement between the
parties, much less written agreement. We are unable, therefore,
to appreciate the submissions made on behalf of the landlord
with regard to sub-section (10) of Section 16 which, in our
view, has been correctly held by the High Court not to be
applicable to the facts of the instant case. It is even doubtful
whether the effect of Section 6 of the Act can be said to enure to
the benefit of the landlords, since the improvements of the
tenanted premises had been effected not by the landlord but by
the tenant himself. For the sake of reference Section 6 of the
Act is reproduced hereinbelow:-
"6. Effect of improvement on rent.\027
Notwithstanding anything contained in Section 4 or
Section 5, but subject to the provisions of Section 8,
where the landlord has, after the commencement of
this Act, either with the consent of the tenant or in
pursuance of any requirement of law, made any
improvement in a building , he may by notice in
writing to the tenant given within three months from
the date of completion of the improvement, enhance
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the monthly rent of the building by an amount not
exceeding one per cent of the actual cost of such
improvement, with effect from the said date, and
thereupon the standard rent of that building shall
stand enhanced accordingly."
In the absence of any proper evidence regarding the
purported agreement for periodical enhancement of the rents,
it becomes difficult to accept the story of such agreed
enhancement as made out on behalf of the landlord or its
application to the provisions of Section 20 (4) of the Act. Since
there is no such evidence on record, except for the
uncorroborated statement of the landlord, we have no other
option but to accept the story of the appellants-tenant that the
parties had agreed to the increase of the monthly rent upto a
maximum of Rs.100/- per month and that too after the
renovation had been effected to the shop room and a shutter
had been fixed therein. If such be the case, the appellants
would also be entitled to the protection of Section 20 (4), since
the rents admitted to be in arrears at the rate of Rs.100/- per
month had been duly deposited by the tenant within the time
prescribed under such provision of the Act.
Although, we have arrived at the aforesaid conclusion, an
element of doubt persists in regard to the effect of Section 6 of
the Act in its application to the facts of the instant case where
undoubtedly certain improvements had been made to the
tenanted premises. Section 6, in fact, permits the landlord upon
improvements made, to give a notice in writing to the tenant
within three months from the date of the completion of the
improvement regarding enhancement of the monthly rent by an
amount not exceeding one per cent of the actual cost of such
improvement. Undoubtedly, the landlord had served notice on
the tenant regarding enhancement of the monthly rents and
demanded payment thereof at the rate of Rs.200/- per month
from 1.4.1989 when, in fact, the repairs had been effected. In
our view, it was not unreasonable for the landlord to enhance
the monthly rents to Rs.200/- per month for the shop in
question since improvements had been made therein.
At this stage, it may be indicated that after the filing of the
Special Leave Petitions, the appellants had been directed by
Order dated 19.3.2004 to clear all the arrears in terms of the
order of the High Court within a period of one month and
thereafter to continue to pay the rent at the same rate month by
month. It has been submitted on behalf of the appellants that
in compliance with the said direction, the appellants had
deposited the monthly rents in favour of the landlord at the
rate of Rs.400/- per month, inclusive of house tax. Since we are
accepting the monthly rent to be Rs.200/- per month, the
appellants-tenant will henceforth from the month of November
2005 pay to the respondents-landlord the monthly rents for the
shop room at Rs.200/- per month. The appellants-tenant will
not lay any claim for re-imbursement of any excess amount that
has been deposited on account of the monthly rents at the
enhanced rate of Rs.400/- per month. The acceptance of the
monthly rent to be Rs.200/- per month is subject to future
enhancement in accordance with law.
The appeals are allowed, the impugned judgments of the
High Court are set aside and the suit filed by the respondents-
landlord is dismissed. There will be no order as to costs.
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