Full Judgment Text
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CASE NO.:
Appeal (civil) 2135 of 1999
PETITIONER:
RAKESH WADHAWAN & ORS.
Vs.
RESPONDENT:
M/S. JAGDAMBA INDUSTRIAL CORPORATION & ORS.
DATE OF JUDGMENT: 26/04/2002
BENCH:
R.C. Lahoti & Brijesh Kumar
JUDGMENT:
R.C. Lahoti, J.
Late Parmodh Paul, who died during the pendency of the
proceedings and whose legal representatives, the appellants before us,
have been brought on record, filed a petition under Section 13 of the
East Punjab Urban Rent Restrictions Act, 1949 (hereinafter ’the Act’,
for short), against the respondent-firm through its two partners on the
ground of the tenants having defaulted in payment of rent, a ground
for eviction under Clause (i) of sub-Section (2) of Section 13 of the
Act. Hereinafter for the sake of convenience and brevity, Late
Parmodh Paul shall be referred to as the ’landlord’ and the
respondents as the ’tenants’.
According to the averments made in the petition for eviction
filed on 17.9.1991, the suit premises were obtained by the tenants on
tenancy from Shri Mani Ram and Smt. Ratan Devi, the then owners
and landlords, under the rent note dated 20-9-1982. The rate of rent
agreed upon was Rs.2000/- per month excluding water and electricity
charges. The tenants neither paid nor tendered the arrears of rent from
1st March, 1985. There was a civil litigation relating to partition of
joint family properties, including the suit premises, between the
members of the family wherein, in terms of an interim order passed by
the Civil Court, the tenants had deposited rent at the rate of Rs.1800/-
per month for the period October 1985 to January 1988. In the
eviction petition, the landlord prayed for a direction from the Rent
Controller to evict the tenants on the ground of non-payment of rent.
In the written statement dated 8.1.1992 the tenants admitted to
have executed the rent note reciting the rate of rent at Rs.2000/- per
month, other than water and electricity charges, but submitted that the
rate of rent so appointed was never intended to be acted upon and the
real monthly rent of the premises was Rs.1800/- only. In the family
litigation, to which the tenants were not a party, in terms of the order
passed by the Civil Court, rent at the rate of Rs.1800/- was deposited
for the period October 1985 to January 1988. The rent for the period
upto September 1985 was paid to the landlords. Subsequent arrears
accumulating, owing to infighting amongst the legal heirs, for the
period 1.2.1988 to September 1991, i.e. for 44 months, amounting to
Rs.79200/- plus interest Rs.8910/- and costs Rs.75/- totalling
Rs.88,185/- were tendered before the Rent Controller on 14.11.1991.
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The Rent Controller held the rate of rent of the demised
premises was Rs.2000/- excluding water and electricity charges. The
amount tendered by the tenants was found to be short and, therefore,
invalid. Consequently, at the end, the tenants were ordered to be
evicted from the suit premises.
The tenants preferred an appeal before the Appellate Authority.
The Appellate Authority reversed the finding of the Rent Controller
and held the rate of rent to be Rs.1800/-, at which rate the arrears had
stood cleared and, therefore, the tenants were not liable to be evicted.
Civil Revision preferred before the High Court by the landlord was
dismissed by the High Court forming an opinion that the finding of
fact arrived at by the Appellate Authority was not liable to be
interfered with in exercise of revisional jurisdiction. This is an appeal
by special leave preferred by the landlord.
We will first examine what is the rate of rent. It is admitted
between the parties that the agreed rate of rent as recited in the deed of
lease executed between the parties was Rs.2000/- but it was the case
of the tenants that the rate of rent so appointed was not intended to be
acted upon. No reason has been assigned to show why the parties
would have arrived at an agreed rate of rent of Rs.2000/- per month
and yet chosen not to act upon it. The subsequent conduct of the
parties belies the plea taken by the tenants. For several months rent
has been paid at the rate of Rs.2000/- p.m.. We would to refer in
particular to the contents of the letter dated 9.8.1985 written by the
tenants to Ratan Devi, the then landlord wherein it is stated inter alia
"we are forwarding herewith two cheques of Corporation Bank,
cheque No.CA 78/770482 dated 9.8.1985 for Rs.4000/- being the
amount of rent for June and July, 1985. Another cheque for United
Commercial Bank, cheque No.256453 dated 9.8.1985 for Rs.2000/-,
the rent of August, 1985 receipt of which please be acknowledged."
The contents of this letter are neither disowned nor explained and this
letter sinks a death-nail into the plea of the tenants. Apart from other
evidence available on record, these two material pieces of evidence
viz. the deed of lease and tenants’ letter abovesaid accompanied by
cheques, are enough to overrule the plea of the tenants and to hold
that the rate of rent is Rs.2000/- p.m.
The Appellate Authority, in arriving at a finding to the contrary,
was deeply impressed by the fact that in the family litigation for
partition of the property, the plaintiffs therein had alleged rate of rent
of these premises as Rs.1800/- p.m. and this averment was not
disputed by the landlord herein, who was one of the defendants
therein. The Appellate Court overlooked some very relevant facts.
The plaintiffs in the partition suit were not the landlords realizing the
rent; that was the landlord herein who was realizing the rent from the
tenants. By an interim order the Civil Court had restrained the tenants
from making payment of rent to the litigating parties and had directed
the rent to be deposited in the Court so as to be available for
distribution to the party found entitled at the end to release of the rent.
The written statement filed in the civil suit by the landlord-plaintiff
herein did not contain any admission as such; there was a mere failure
to object. In that suit, rent payable by the tenants herein was not a
subject matter of controversy; it was a side issue. Admission is only a
piece of evidence and can be explained; it does not conclusively bind
a party unless it amounts to an estoppel. Value of an admission has to
be determined by keeping in view the circumstances in which it was
made and to whom. A mere failure to object cannot be placed on a
footing higher than an admission. If the two clear cut admissions
made by the tenants, referred to herein above, were to be weighed
against the landlord’s mere failure to object about a wrong averment
as to rate of rent in a case where it was not a point in issue, then no
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inference other than the one of the rate of rent being Rs.2000/- p.m.
could have been drawn. To that extent, the finding arrived at by the
Appellate Authority suffer from perversity and should have been set
aside by the High Court even in exercise of revisional jurisdiction.
On the material available on record, no inference other than the rent of
the suit premises being Rs.2000/- p.m., excluding water and electricity
charges, can be drawn. We hold it accordingly.
Though we are holding the rate of rent as Rs.2000/-p.m.
excluding water and electricity charges but it cannot be denied that to
begin with there was a serious dispute as to the rate of rent as to
whether it was Rs.2000/-, and hence followed the dispute whether the
amount tendered by the tenant in the suit along with interest and cost
of application amounted to compliance with proviso under Section 13
(2)(i), and if so, whether a decree for eviction could at all have been
passed. All such disputes were genuine and not frivolous or just in air
without any basis. In this appeal, the tenant-respondents have, in the
affidavit of Ashwini Kumar, supported by documents, filed with the
leave of the Court, set a statement of payments made, which reveals
that the controversy between the parties is very narrow, and even if
there is some default in payment it is marginal and not deliberate.
There is a serious lacuna with which the relevant provision of the Act
suffers which we propose to demonstrate and deal with so as to
remove the same, if we can.
The landlord-tenant litigation accounts for a major part of
litigation pending in courts of law or before statutory authorities.
Also a substantial number of cases consists of those wherein eviction
is prayed for on the ground of non-payment of rent or the tenant
being a defaulter. The enactment of 1949 Act was preceded by the
Punjab Urban Rent Restriction Act 1941 which was intended to
restrict unreasonable hike in rent because of shortage of
accommodation felt on account of housing properties being
requisitioned by the Government to provide accommodation to the
families of civil and army officers engaged in the war effort in some
capacity or the other. For raising additional revenue to compensate
the costs of the war, new tax on the immoveable property was
imposed. The 1941 Act was to remain in force only for a period of
five years. It was replaced by 1947 Act enacted by the Governor of
Punjab in exercise of his powers under Section 93 of the Government
of India Act, 1935. Then the country witnessed partition and large
scale migration of population between the East and West Punjab. In
this wake the 1949 Act was enacted. Statement of Objects and
Reasons of the Act stated, inter alia, that need was felt to re-enact as a
permanent measure, a legislation for restricting the increase of rents of
certain premises situated within the limits of urban areas and the
protection of tenants against malafide attempts by their landlords to
procure their eviction. The State legislation enacted more than 50
years ago as a measure for taking care of the then problem created by
the then circumstances has, nevertheless, continued to remain in
operation till this date. The legislation needs a new look and
revamping at the hands of the legislature. There are several lacunae in
the provisions of the Act creating bottlenecks in their smooth
functioning highlighted in several judicial pronouncements and such
deficiencies are proving paradise for unscrupulous litigants and also to
some extent frustrating the very purpose sought to be achieved by the
legislation. One of such deficiencies in legislation, as we would
highlight a little later, is capable of being demonstrated from the facts
of the present case. Before we may enter into that discussion, we find
it appropriate to reproduce the observations made by Professor D.N.
Jauhar, Department of Laws, Punjab University based on his research
and survey in his work "Rent Matters on Trial" (1998), at page 23:
"The present Rent Act had outlived its utility
decades ago and has become totally outdated.
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The Act which was initially introduced as a
temporary short term measure for five years only,
during the Second World War, has become a
permanent piece of legislation. One would not
mind its being permanently on the Statute Book
but what is really disturbing is that it has
stagnated for the last five decades. No effort
whatsoever, worth the name, has been made
either by the State Government, or the Central
Government to suitably revise the Act from time
to time so as to keep pace with the changing
socio-economic pattern of society.
The need of the hour is a law which will
regulate, not control, the relations between an
owner and an occupier with the sole object of
harmonising relations between the two. Such a
statute is the dire need of the hour which requires
that the present Act be consigned to history."
In Nagindas Ramdas Vs. Dalpatram Iccharam Brijram &
Ors. - (1974) 1 SCC 242 this Court summed up the reasons which
persuaded the spurt of rent control legislations in different States of
the country in these words :
"The strain of the last World War, Industrial
Revolution, the large scale exodus of the working
people to an urban areas and the social and
political changes brought in their wake social
problems of considerable magnitude and
complexity and their connected evils. The country
was faced with spiralling inflation, soaring cost of
living, increasing urban population any scarcity of
accommodation. Racketing and large scale
eviction of tenants under the guise of the ordinary
law, exacerbated those conditions making the
economic life of the community unstable and
insecure. To tackle these problems and curb these
evils, the Legislatures of the States in India
enacted Rent Control legislations."
Almost similar necessity existed in the State of Punjab for
enacting the 1949 Act as pointed out by this Court in Attar Singh Vs.
Inder Kumar AIR 1967 SC 773. The Court observed that the Act is
a piece of ameliorative legislation in the interests of tenants of
premises in urban areas, so that they may be protected against large
increase in rents and from harassment by eviction.
It is high time when State of Punjab should have a fresh look at
Section 13 and other relevant provisions of the Act learning lessons
from the manner in which these provisions have so far worked and by
reviewing how far the object which the legislation sought to achieve
has been achieved or frustrated. Useful assistance can be taken from
the Rent Control legislations in other States to see how pari materia
provisions have been drafted therein. The phraseology employed in
drafting Section 13(2)(i) with its proviso and the manner in which it
has been so far interpreted, are, in our opinion, far from serving the
object of enactment, rather defeating it.
The relevant part of Sec.13 reads as under:
"13. Eviction of tenants. (1) A tenant in
possession of a building or rented land shall not be
evicted therefrom in execution of a decree passed
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before or after the commencement of this Act or
otherwise and whether before or after the
termination of the tenancy, except in accordance
with the provisions of this Section, [or in
pursuance of an order made under Section 13 of
the Punjab Urban Rent Restrict Act, 1947, as
subsequently amended].
(2) A landlord who seeks to evict his tenant
shall apply to the Controller for a direction
in that behalf. If the Controller, after giving
the tenant a reasonable opportunity of
showing cause against the applicant, is
satisfied
(i) that the tenant has not paid or
tendered the rent due by him in
respect of the building or rented land
within fifteen days after the expiry of
the time fixed in the agreement of
tenancy with his landlord or in the
absence of any such agreement, by the
last day of the month next following
that for which the rent is payable:
Provided that if the tenant on the first
hearing of the application for ejectment after
due service pays or tenders the arrears of
rent and interest at six per cent per annum
on such arrears together with the cost of
application assessed by the Controller, the
tenant shall be deemed to have duly paid or
tendered the rent within the time aforesaid;
xxx xxxx xxx
"the Controller may make an order directing
the tenant to put the landlord in possession
of the building or rented land and if the
Controller is not so satisfied he shall make
an order rejecting the application:
Provided that the Controller may give the
tenant a reasonable time for putting the
landlord in possession of the building or
rented land and may extend such time so as
not to exceed three months in the
aggregate".
The expression employed is ’the rent due’. A Full Bench of
the High Court of Punjab in Rullia Ram Hakim Rai v. S. Fateh
Singh S. Sham Sher Singh, AIR 1962 Punjab 256, has taken the view
that the expression ’rent due’ in contradistinction with the words ’rent
legally due’ or ’rent recoverable’ or the ’arrears of rent within the
period of limitation’ implies that the obligation of the tenant to pay or
tender the rent extends to depositing all the arrears of rent without
regard to the period of limitation. This view finds support from a
decision of this Court in Khadi Gram Udyog Trust Vs. Shri Ram
Chandraji Mandir, 1978 (1) SCC 44, wherein, interpreting the pari
materia provision contained in the U.P. Urban Buildings (Regulation
of Letting, Rent and Eviction) Act, 1972, this Court has held that the
expression "entire amount of rent due" includes the rent the recovery
whereof has become barred by time, for, the statute of limitation bars
the remedy but does not extinguish the right. The learned counsel for
the tenants conceded during the course of hearing that on the present
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framing of the provision under examination, the obligation of the
tenant to pay or tender even time barred rent, to take advantage of the
proviso, cannot be denied.
The question still remains what is the amount which the tenant
should tender and what is the course to be followed if there be any
genuine dispute between the amount claimed or alleged by the
landlord to be due and the amount which the tenant admits or alleges
to be due. Apparently the Punjab Act does not provide any
mechanism taking care of such a situation. A Division Bench of the
High Court in Mangat Rai v. Ved Parkash, 1969 CLJ 254, took the
view that it is wrong to say that the proviso casts only a unilateral duty
on the tenant, without there being any corresponding duty and
discretion vesting in the Court in connection therewith. There are
reciprocal obligations created by the proviso. So far as the calculation
of arrears of rent and interest is concerned, that is the sole
responsibility of the tenant. But so far as the assessment of the costs
is concerned, the proviso assigns that function to the Controller.
There are a few other decisions also taking the same view. However,
we do not find any in-depth discussion or any attempt made at
analyzing and interpreting the proviso in the light of the object behind
the enactment.
There may be unscrupulous landlords, who with the purpose of
placing the tenants in a quandary and thereby earning an easy order of
eviction may highly inflate the claim. For example, the landlord may
claim the arrears at a highly inflated rate of rent, or may claim rent
alleging it to be in arrears though the same had already stood paid and
for which the landlord chose not to issue receipts for payment, or
there may be a bonafide dispute as to the rate at which the rent was
paid or is payable. Several other State legislations provide for an
interim or provisional order being passed by the Court or the Rent
Controller, resolving the dispute momentarily by a judicial order, with
which order the tenant should comply and failing which the tenant
may suffer adverse consequences. A provision for such an interim or
provisional order has not been expressly made in the Punjab Act; yet
can it be spelt out? If we were to go by adopting an approach
approving the interpretation placed on the proviso by the Punjab High
Court in Mangat Ram’s case (supra), serious and uncalled for
consequences are bound to follow.
In Dial Chand v. Mahant Kapoor Chand, 1967 (69) PLR 248,
the learned Single Judge of Punjab High Court opined that in the
event of there being a dispute as to the quantum of rent, the tenant can
take one of the three courses:
"He can under protest make payment or
tender of the arrears at the rate claimed by
the landlord in the ejectment application,
and if the rate is found subsequently to be
less, he can hope for adjustment of the
excess payment. He can come forward with
a straight statement of what is the true rate
of rent and on that proceed to comply with
the proviso, in which case he has the benefit
of the proviso, if the finding is that the rate
stated by him is the rate of rent for the
tenancy. Lastly, he can enter into a dispute
with the landlord, as in this case, and insist
upon his lower rate of rent and then take the
consequence if he is not able to prove that
that is the actual rent. If he fails to establish
this ground, obviously he fails to have
advantage of the proviso."
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This is too simplistic an approach and defeats the purpose of
enactment as would be seen shortly hereafter. In Behari Lal v.
Ajudhia Dass, 1970 RCR 76, the tenant tendered full amount claimed
by the landlord to plead that what he was paying was more than the
rent due and reserved his right to recover back the excess paid by
him. The plea forcefully advanced by the landlord was that as the
tenant had pleaded the amount tendered by him to be in excess,
accompanied by a claim for refund, the same was not a valid tender,
and therefore, the tenant was liable to be ejected. Such a tall plea of
the landlord, of course, did not find favour with the High Court and
rightly so. Yet the manner in which Section 13 (2)(i) with the proviso
has been interpreted in some of the decisions by Punjab High Court, if
allowed to prevail, the consequence would be that the tenants shall
have to succumb to the pressure of the landlord by conceding and
making the payment or tender as dictated by the landlord along with
interest and costs; else he inescapably suffers the risk of eviction. If
he raises a dispute in defence even if bonafide, and howsoever
believed to be true, he must suffer eviction if on trial, for any reason
including any fortuitous circumstances, he fails in substantiating his
plea though he very much believed, and genuinely, that he would be
able to do so. A tenant forcefully raising a plea in his defence stands
to lose and suffer for his failure to substantiate his defence. On the
contrary, if the landlord has made a false or exaggerated claim,
submitted to by the tenant by making a deposit with interest and costs,
and the landlord fails in substantiating his claim of the arrears, he does
not stand to lose anything. Thus there are no holds barred for the
landlord while the tenant is subject to strict discipline. This could not
have been the intendment of an enactment, which as its Preamble
speaks, is meant to restrict the eviction of tenants from urban
premises.
There are two means of resolving the riddle : firstly, by placing
such meaningful interpretation on the provision as would enable the
legislative intention being effectuated; and secondly, by devising such
procedure without altering the structure as would enable the
substantive law being meaningfully implemented. Let us see whether
the expression ’assessed by the Controller’ qualifies only ’the cost of
application’ or qualifies the entire preceding expression i.e. ’the
arrears of rent and interest at six per cent per annum on such arrears
together with the cost of application’. As there is ambiguity and the
provision is susceptible to two meanings, the Court should interpret it
in the manner which will best serve the object sought to be achieved.
In our opinion, if there be a dispute raised as to the quantum of arrears
of rent, or as to the rate of rent which would obviously in its turn have
an impact on the quantum of arrears, then for the purpose of payment
or tender within the meaning of the proviso, the Controller must make
an assessment, provisional in nature, and appoint the quantum of
arrears including the rate of rent (if necessary) and, calculating the
interest and the cost of application. There may be a dispute as to the
date on which the monthly rent becomes due according to the contract
of tenancy which will also need to be resolved without which the
period for which interest at six per cent per annum is liable to be paid
would not be capable of being quantified. For two reasons, we
consider it necessary to place such an interpretation or the language of
the proviso. Firstly, it is in conformity with the object of enactment.
The legislation was enacted to protect the tenants from the hands of
unscrupulous landlords and any interpretation to the contrary would
give an upper hand to the landlords and provide a tool in their hands
to be cracked like a whip on weaker tenants. Secondly, such an
interpretation would bring the provision in conformity with the
several other legislations of the times such as Section 13 of the M.P.
Accommodation Control Act, 1961, Section 11 of A.P. Buildings
(Lease and Eviction) Control Act, 1960, Section 11(4) of Bombay
Rents, Hotels and Lodging House Rates Control Act, 1947, Section 15
of Delhi Rent Control Act, 1958 and so on. Thirdly, the provision
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suffers from ambiguity. In the absence of any in-built indication
enabling determination of the quantum of arrears, if disputed, and the
period for which interest at six per cent per annum is to be calculated,
the provision would become unworkable and hence liable to be struck
down under Article 14 of the Constitution. An obligation is cast on
the Court to interpret it in such a manner as to make it workable and
save it from the vice of being rendered unconstitutional.
Even if Section 13(2)(i) and the proviso would not have been
enacted there was Section 114 of the Transfer of Property Act to take
care of such situation. The provision in the Rent Control Legislation
which obliges the tenant to pay or tender the arrears of rent during the
course of hearing and relieve the tenant from the consequences of
default in payment of rent is founded on the doctrine of forfeiture of
lease for non-payment of rent and equitable principle of granting relief
against forfeiture within the exercise of discretion vesting in the
Court. The Transfer of Property Act, 1882 did not in terms apply to
the State of Punjab however principles underlying or contained in
such of the provisions of the Transfer of Property Act as are
essentially the principles of equity, justice and good conscience have
been held applicable to the State of Punjab and Haryana. Section 114
of T.P. Act embodies one such principle. (See Namdeo Lokman
Lodhi Vs. Narmadabai and Ors. AIR 1953 SC 228; Guru Nanak
Ex Servicemen Cooperative T.F. Society Group No.2 and Ors. Vs.
The State of Haryana and Ors. AIR 1972 Punjab & Haryana 83
D.B.; Aziz-Ud-Din and Ors. Vs. Guru Bhagwan Das and Anr. -
(1912) 17 IC 991). The rule of equity enshrined in Section 114 of
Transfer of Property Act is : Where a lease of immoveable property
has determined by forfeiture for non-payment of rent and the lessor
files a suit for ejectment of the lessee, the Court exercises a
discretionary jurisdiction of passing an order relieving the lessee
against the consequences of forfeiture if at the hearing of the suit the
lessee pays or tenders to the lessor the rent in arrears with interest and
costs or furnishes such security as the Court thinks sufficient. Having
appointed a time for payment, the Court still retains jurisdiction to
extend the time (Chandless-Chandless Vs. Nicholson 1942 (2) All
ER 315). Even the time appointed by a consent decree can be
extended (Smt. Amiya De Vs. Dhirendra Nath Mandal AIR 1971
Calcutta 263). The discretion conferred by Section 114 of TP Act is
of wide amplitude guided by the principles of justice, equity and
good conscience and the Court would examine the conduct of the
parties, the comparative hardship and lean in favour of one whose
hands are clean (Namdeo Lokman Lodhi Vs. Narmadabai and Ors.
AIR 1953 SC 228. The discretion to grant relief again forfeiture is
available not only to the trial court but also to appellate court ( R.S.
Lala Praduman Kumar Vs. Virendra Goyal (dead) by his Lrs. And
Ors. 1969 (1) SCC 714.
The question which stares us is : whether in enacting Section
13(2)(i) and proviso thereto can we assume that the Legislature
intended to place the tenants in a situation worse than what it would
have been under the principles deducible from Section 114 of T.P. Act
and even if this provision would not have been there? We cannot
attribute such misplaced wisdom to the Legislature without being
uncharitable to it. We are definitely of the opinion that by engrafting
Section 13(2)(i) and proviso in the body of the Act the Legislature
intended to confer on the tenants a protection, larger and more
beneficial than what it would have been if the provision was not
enacted.
There are yet other serious infirmities with which the provision
suffers. In spite of the proviso having been complied with the Rent
Controller, proceeds to hold an enquiry and record a finding on the
pleas raised in the case. If the Controller finds merit in the dispute
raised by the tenant and accepts the truth of his plea, the deposit made
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by him, though it did not satisfy the claim then made by the landlord
would still entitle the tenant to an order rejecting the landlord’s
application for eviction. If the deposit made by him is to be found in
excess, would he would be entitled to an order for refund? The
provision does not give an answer. If the tenant fails in substantiating
his plea and the amount paid or tendered by him under the proviso is
found to be deficient, the landlord would be entitled to an order
directing the tenant to put the landlord in possession of the building or
rented land. Yet the Controller cannot pass an order for recovery of
arrears though found to be due. The landlord is constrained to initiate
separate proceedings for recovery of arrears of rent before the Civil
Court. Yet again, during the pendency of proceedings under Section
13, the provision does not contemplate rent falling in arrears month
by month being paid or deposited by tenant. The landlord is therefore
driven to the need of filing successive proceedings for recovery of
rent against an erring tenant. Thus the view so far being taken by the
High Court serves neither the interest of the tenant nor the interest of
the landlord. All these result in multiplicity of legal proceedings. The
end part of sub-section (2) of Section 13 confers a discretionary
jurisdiction on the Controller who "may make an order directing the
tenant to put the landlord in possession of the building or rented land".
Once a case for eviction on one of the grounds under Section 13 has
been satisfactorily made out the Controller cannot refuse making an
order for delivery of possession to the landlord in purported exercise
of discretion spelled out by use of word ’may’ because the exercise of
discretion would then be termed as arbitrary as that of "knight-errant
roaming at will" in the words of Benzamin Cordozo. The fact
remains that the legislature has chosen to use the word ’may’ and not
’shall’ at the end of sub-section (2) while empowering the Controller
to make an order for eviction of tenant.
The purpose of enacting such a provision as in Section 13(2)(i)
proviso, which acts almost in terrorem on the tenant, in several rent
control laws is dual. It ensures recovery of rent to the landlord and
saves him from the recalcitrant tenant by building pressure on tenant
to make payment under pain of eviction. At the same time it protects
the tenants from the unscrupulous devices of landlords. Both the
purposes are defeated by too simplistic an interpretation placed on
Section 13(2)(i) proviso of the Punjab Act by the High Court of
Punjab and Haryana, as already referred to.
It is a settled rule of construction that in case of ambiguity, the
provision should be so read as would avoid hardship, inconvenience,
injustice, absurdity and anomaly. Justice G.P. Singh in his Statutory
Interpretation (Edition 2001) states (at page 113): "In selecting out of
different interpretations "the court will adopt that which is just,
reasonable and sensible rather than that which is none of those things"
as it may be presumed "that the Legislature should have used the
word in that interpretation which least offends our sense of justice. If
the grammatical construction leads to some absurdity or some
repugnance or inconsistency with the rest of the instrument, it may be
departed from so as to avoid that absurdity, and inconsistency.
Similarly, a construction giving rise to anomalies should be avoided"
What follows from the abovesaid discussion is that the proviso
to clause (i) of sub-section (2) of Section 13 must be read as obliging
the Controller to assess, by means of passing an order, the arrears of
rent, the interest and the cost of litigation all the three, which the
tenant shall pay or tender on the first date of first hearing of the main
petition following the date of such assessment by Controller. Such
order based on an opinion formed prima facie by perusal of the
pleadings and such other material as may be available before the
Controller on that day would be an interim or provisional order which
shall have to give way to a final order to be made on further enquiry
to be held later in the event of there being a dispute between the
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parties calling for such determination. The Controller would,
however, at the outset assess the rent, the interest and the cost of
application in the light of and to the extent of dispute, if any, raised by
the tenant. Such amount, as determined by Controller shall be liable
to be paid or tendered by the Controller on the ’first date of hearing’
falling after the date of the preliminary or provisional order of
Controller. The expression "the date of first hearing" came up recently
for the consideration of this Court in Mam Chand Pal Vs Smt. Shanti
Agarwal (C.A. No.1187 of 2002 decided on 14.2.2002). It was held
that ’the date of first hearing’ is the date on which the Court applies its
mind to the facts and controversy involved in the case. Any date prior
to such date would not be date of first hearing. For instance, date for
framing of issues would be the date of first hearing when the Court
has to apply its mind to the facts of the case. Where the procedure
applicable is the one as applicable to Small Cause Courts, there being
no provision for framing of the issues, any date fixed for hearing of
the case would be the first date for the purpose. The date fixed for
filing of the written statement is not the date of hearing. Keeping in
view the interpretation so placed on ’the date of first hearing’ the
obligation cast by the proviso under consideration can be discharged
by the Controller on any date fixed for framing of the issues or for
hearing. It would be the obligation of the parties to place the relevant
material on record, in the shape of affidavits or documents, which
would enable the Controller to make a provisional judicial assessment
and place it on record to satisfy the spirit of the proviso. It would be
desirable if the Rent Controller specifically appoints a date for the
purpose of such assessment and order so that the parties are put on
adequate notice and bring the relevant material on record to assist the
Controller. A litigant cannot be expected to be ready to comply with
the order of the Controller on the very day on which the order is
made. How could he anticipate what order the Controller would be
making?
Having held that the Controller, has to provisionally assess (i)
the arrears of rent, (ii) the interest on arrears of rent assessed by him,
and (iii) cost of application, question arises as to how the provision
shall work thereafter or, in other words, what shall be the procedure to
be followed thereafter by the Controller. Salmond states in
Jurisprudence (Twelfth Edition, pp. 5-6):
"Suppose the legislator could draft rules that
were absolutely clear in application: even so, he
could not foresee every possible situation that
might arise, and so, he could not anticipate how
he, or society, would wish to react to it when it
did arise. Too certain a rule would preclude the
courts from dealing with an unforeseen situation
in the way they themselves, or society, might
think best. As it is, legal uncertainty is counter-
balanced by judicial flexibility."
We may with advantage quote a passage from Law in the
Making by Sir Allen (Seventh Edition, 1964, at p.308):
" ’This Court’, said Scrutton L.J., ’sits to
administer the law; not to make new law if there
are cases not provided for.’ ’It may be’, said
Lord Denning M.R. in Att.-Gen.- v. Butterworth,
[1963] I, Q.B.,696, 719, ’that there is no
authority to be found in the books, but if this be
so all I can say is that the sooner we make one
the better.’ But how did the Master of the Rolls
’make’ this authority? By reference to ’many
pointers to be found in the books in favour of the
view which I have expressed’."
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Again at page 521, the eminent jurist states:
"There is no doubt that some judges will ’read
into’ a statute, under the guise of the ’implied
intention’ of the legislator, what justice and
convenience require."
A statute can never be exhaustive, and therefore, Raghubar
Dayal,J. speaking for himself and Wanchoo and Das Gupta, JJ.
observed in Manohar Lal Chopra v. Rai Bahadur Rao Raja Seth
Hiralal, AIR 1962 SC 527 at page 532, "that the Legislature is
incapable of contemplating all the possible circumstances which may
arise in future litigation and consequently for providing the procedure
for them." Sometimes when a difficult situation arises it may demand
such directions being made as would pragmatically meet the needs of
the situation and resort can be had to the inherent powers of the
Court, if need be. Krishna Iyer, J. in The Newabganj Sugar Mills Co.
Ltd. and others v. The Union of India and others, (1976) 1 SCC 120,
held "The difficulty we face here cannot force us to abandon the
inherent powers of the Court to do", and he quoted Jim. R. Carrigam
to say - "The inherent power has its roots in necessity and its breadth
is co-extensive with the necessity." H.R. Khanna, J. observed in M/s.
Jaipur Mineral Development Syndicate, Jaipur v. The
Commissioner of I.T., New Delhi, (1977) 1 SCC 508 : "The Courts
have power, in the absence of any express or implied prohibition, to
pass an order as may be necessary for the ends of justice or to prevent
the abuse of the process of the court. To hold otherwise would result
in quite a number of cases in gross miscarriage of justice."
Jurisdiction to pass procedural orders though not specifically
contemplated by statute can be spelled out from what was said by
Hidayatullah, J. (as he then was) in Mahant Ram as Vs. Ganga Das,
AIR 1961 SC 882, when orders are ’in essence in terrorem so that
dilatory litigants might put themselves in order and avoid delay’ the
Courts are not powerless to meet a situation for ’such orders are not
like the law of the Medes and the Persians’.
The result of the discussion may be summarized. Under
proviso to Section 13(2)(i), the Controller having discharged his
obligation of passing an order under the proviso, either suo moto or on
his attention in this regard being invited by either of the parties, it will
be for the tenant to pay or tender the amount provisionally assessed by
the Controller on the first date of hearing of the application for
ejectment. On compliance, the Controller would proceed to
adjudicate upon the controversy arising for decision by reference to
pleadings of the parties and by holding a summary enquiry for the
purpose. Such adjudication shall be provisional and subject to the
later final adjudication. The finding that may ultimately be arrived at
by the Controller may be one of the following three. The Controller
may hold that the quantum of arrears as determined finally is (i) the
same as was found to be due and payable under the provisional order,
(ii) is less than what was determined by the provisional order, or (iii)
is more than the one what was held to be due and payable by the
provisional order. In the first case the Rent Controller has simply to
pass an order terminating the proceedings. In the second case the
Controller may direct the amount deposited in excess by the tenant to
be refunded to him. In the third case it would not serve the purpose of
the Act if the tenant was held liable to be evicted forthwith as is the
view taken by the Punjab High Court in the case of Dial Chand
(supra). The Controller directing the eviction of the tenant may pass a
conditional order affording the tenant one opportunity of and a
reasonable time for depositing the amount of deficit failing which he
shall be liable to be evicted. This power in the Rent Controller can be
spelled out from the use of the word "may" in the expression "The
Controller may make an order directing the tenant to put the landlord
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in possession", as also from the principle of equity and fair play that
the tenant having complied with provisional order passed by the
Controller should not be made to suffer if the finding arrived at by the
Controller at the termination of the proceedings be different from the
one recorded in the provisional order. While exercising the discretion
to make a conditional order of eviction affording the tenant an
opportunity of purging himself of the default the Controller may also
take into consideration the conduct of the tenant whether he has even
after the passing of the provisional order continued to pay or tender
the rent to the landlord during the pendency of the proceedings as a
relevant factor governing the exercise of his discretion. Such a course
would be beneficial to the landlord too as he would be saved from the
trouble of filing a civil suit for recovery of rent which fell due during
the pendency of proceedings for eviction before the Controller.
To sum up, our conclusions are:
1. In Section 13(2) (i) proviso, the words ’assessed by the
Controller’ qualify not merely the words ’the cost of
application’ but the entire preceding part of the sentence i.e.
’the arrears of rent and interest at six per cent per annum on
such arrears together with the cost of application’.
2. The proviso to Section 13(2)(i) of East Punjab Urban
Restriction Act, 1949 casts an obligation on the Controller to
make an assessment of (i) arrears of rent (ii) the interest on such
arrears, and (iii) the cost of application and then quantify by
way of an interim or provisional order the amount which the
tenant must pay or tender on the ’first date of hearing’ after the
passing of such order of ’assessment’ by the Controller so as
to satisfy the requirement of the proviso.
3. Of necessity, ’the date of first hearing of the application’ would
mean the date falling after the date of such order by Controller.
4. On the failure of the tenant to comply, nothing remains to be
done and an order for eviction shall follow. If the tenant makes
compliance, the inquiry shall continue for finally adjudicating
upon the dispute as to the arrears of rent in the light of the
contending pleas raised by the landlord and the tenant before
the Controller.
5. If the final adjudication by the Controller be at variance with
his interim or provisional order passed under the proviso, one of
the following two orders may be made depending on the facts
situation of a given case. If the amount deposited by the tenant
is found to be in excess, the Controller may direct a refund. If,
on the other hand, the amount deposited by the tenant is found
to be short or deficient, the Controller may pass a conditional
order directing tenant to place the landlord in possession of the
premises by giving a reasonable time to the tenant for paying or
tendering the deficit amount, failing which alone he shall be
liable to be evicted. Compliance shall save him from eviction.
6. While exercising discretion for affording the tenant an
opportunity of making good the deficit, one of the relevant
factors to be taken into consideration by the Controller would
be, whether the tenant has paid or tendered with substantial
regularity the rent falling due month by month during the
pendency of the proceedings.
The view of the law so taken by us advances the object sought
to be achieved by the legislation, serves best the interests of landlord
and tenant both, removes uncertainty in litigation and obscurity in
drafting of the provision and also accords with the principles of justice
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and equity. Even if, it is an innovation, it is in the field of procedural
law, without affecting the substantive rights and obligations of the
landlord and the tenant and such innovation is permissible on the basis
of authority and supported by principles of justice, good sense and
reason. We have not touched the substantive rights of landlord and
tenant, and are feeling satisfied with a do little in the field of
procedure so as to effectuate the purpose of enactment.
We do not find that the Controller has, in the present passed any
order under Section 13(2)(i) proviso as aforesaid and therefore the
order for eviction stands vitiated on the view of the law which we
have taken hereinabove. The appeal is allowed. The impugned
judgment of the High Court and the orders of the Rent Controller as
also of the Appellate Authority are all set aside. The case is sent back
to the Controller. The Controller shall, after affording the parties an
opportunity of hearing, pass a provisional order under the proviso to
Section 13(2)(i) and afford the tenants an opportunity of making
payment or tender and then proceed to decide the case afresh
consistently with the law as settled hereby. The costs before the
Appellate Authority, the High Court and this Court shall be borne by
the parties as incurred. The costs before the Controller shall abide the
result.
. .......................J.
( R.C. LAHOTI )
.........................J.
( BRIJESH KUMAR )
April 26, 2002.