Full Judgment Text
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PETITIONER:
RAJA BAHADUR MOTILAL BOMBAY MILLS LTD.AND ANOTHER
Vs.
RESPONDENT:
M/S. GOVIND RAM BROTHERS (P) LTD., ANDANOTHER.
DATE OF JUDGMENT12/03/1974
BENCH:
SARKARIA, RANJIT SINGH
BENCH:
SARKARIA, RANJIT SINGH
KRISHNAIYER, V.R.
CITATION:
1974 AIR 1708 1974 SCR (3) 577
1974 SCC (2) 178
ACT:
Bombay Rent Hotel and Lodging House Rates Control Act (57 of
1947), s. 11 (1) (e)--Applicability of Principle of
apportionment.
HEADNOTE:
On September 1, 1940, the basic date under the Bombay Rents,
Hotel and Lodging House Rates Control Act, 1947, the
properties in dispute were parts of a larger entity
comprised in a single lease. In March 1948, the respondent
took a fresh lease of the properties in dispute, Thereafter,
the respondent filed applications in the court of Small
Causes for fixation of standard rent on the basis of
apportionment. The trial court dismissed the applications
holding that the premises, on account of structural
alterations, had undergone such a change that they could no
longer be identified with the property that existed in
September 1940; that the mode of determining the rent by
apportionment was not available to the tenant; and that
there was no sufficient material for ascertaining the
standard ’ rent in any other way. This order was set aside
in revision and the case was remanded to the trial court.
After remand, the trial court held that except with respect
to three items of the premises in dispute, which were new
Structures, there was no change of identity in the rest of
the properties; that the new structures belonged to the
respondent who was consequently liable to pay rent only for
the land underneath; and on that basis, applying the
principle of apportionment, fixed the standard rent. With
respect to one item the trial court took into consideration
the investment made by the landlord inclusive of the, cost
of structures, estimated the value of the land underneath as
in 1940, and fixed the standard rent on that basis. In
revision it was held that the ownership of the three new
structures also vested in the appellant, that he was
entitled to get a fair return on that investment also and
that the value of the land should be taken as in 1948 and
not in 1940, and the standard rent was fixed on that basis.
Further revisions to the High Court were dismissed with some
arithmetical corrections.
In appeal to this Court,
HELD : The principle of apportionment is applicable to the
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fixation of standard rent of the premises in dispute and the
principle had been rightly invoked and applied. [584 F-G]
(a) One of the primary objects of the Act is to curb
exaction of extortionate rent. Section II (1) empowers the
Court to fix the standard rent at such amount, as having
regard to the provisions of the Act and the circumstances of
the case, the Court deems just, If on the basic date the
premises were not let out separately but were a part of the
subject matter of a larger demise then s. 11(1)(c) comes
into operation. If the standard rent of a whole was a
specific amount it stands to reason that the standard rent
of a part or sub-division of the whole should not ordinarily
exceed that amount. Therefore, if in the circumstances of a
given case the court feels that for securing the ends of
justice and giving effect to the provisions and policy of
the Act it is reasonably necessary and feasible to work out
the standard rent by apportionment, it can legitimately do
so. The language of the Act consistently with its scheme
and in built policy is elastic enough to permit the fixation
of standard rent on apportionment basis. At the same time,
caution and circumspection are necessary in applying the
principle to the particular circumstances of a case. For
example, if after the material date, the landlord has made
investments and improvements in the premises it will be just
and reasonable to take that factor also into account and
give him a fair return on such investment. Similarly, in
apportioning the rent, the Court must also consider other
relevant circumstances and advantages enjoyed by the tenant
of the premises of which the standard rent is in question as
compared with the rest
578
of the Property in which it is comprised.Further,where after
the basic date the premises completely changed their
identity, apportionment as a method of determining just
standard rent loses its efficacy and may be abandoned
altogether.[583E-585C]
Narayanlal Bansilal v. Venkatrao Anant Rai 67 Bom. L.R.
352, Bainbridge v. Congdon (1925) 2 K.B. 261 and Fox v.
Bishop of Chester (1824) 2 B & C 635 at 655 referred to.
Dhanrajgirji Naraingirji v. W. G. Ward (1925) 27, Bom.
L.R. 877 and Bata Shoe & Co. Ltd. v. Narayan Das Mullick and
Ors. not approved.
(b)(1) The findings of the trial court before remand had
been set aside in the order of remand, and there is nothing
wrong or unfair or untenable in the method adopted by the
lower courts after remand which would warrant interference
by this Court in exercise of special jurisdiction under Art.
136 of the Constitution. [587D-G]
(ii) The question whether certain property has changed its
identity after the basic date is largely one of fact. The
factual conclusions arrived at by the revisional court and
High Court are not shown to be perverse or manifestly
unjust" It was with regard to the unchanged old properties
that the High Court and the Revisional Court mainly adopted
the method of apportionment. Even so, they allowed the
landlord a fair return over the amount invested by him
towards the cost of flooring, ceiling and other fixtures.
since the rent of the old unchanged premises was fixed
mainly on apportionment basis, the courts rightly did not
think it necessary to take the value of their sites
separately into computation in fixing the standard rent.
[588 B-D]
(iii) As regards the new structures the courts below, in
capitalising their value did take into account the value of
the land and took the market value of the land as in the
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year 1948. [588B]
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeals Nos. 1186-1188
of 1972.
Appeals by special leave from the Judgment and Order (fated
12/ 13/15th October, 1971 of the Bombay High Court in
Special Civil Application Nos. 555, 556 of 1967 and 72 of
1968.
K. S. Cooper, M. K. Shah, P. H. Parekh and Sunanda
Bhandare, for the appellants.
B. N. Lokur, Rameshwar Nath, for respondent No. 1.
Subodh Markendeya, for Respondent No. 2.
The Judgment of the Court was delivered by
SARKARIA, J.-Whether the principle of apportionment is
applicable to the fixation of standard rent of a premises-
under the Bombay Rents, Hotel and Lodging House Rates
Control Act, 1947 (for short, the Act); if so whether on the
facts of the case, the principle has been rightly
invoked--is the two fold question that falls for decision in
these three appeals by special leave directed against the
judgment of the High Court of Judicature at Bombay.
The material facts are as under
A big compound, measuring 11,150 sq. yards, at 156 Tardeo
Road, Bombay, belonged to Raja Bahadur Moti Lal Mills,
Ltd., Bombay, appellant No.1. The Mills were shifted from
these premises in the year 1930. In 1932, the whole of this
estate including the structures standing on. a part of it,
was let out to Sound Studios Ltd. Between the years 1932
and 1940, some part of it was sub-let by Sound Studios to
Sheraj Ali, who was the proprietor of M/s. Famous
579
Cine Laboratory and another part to Neon Signs (India) Ltd.,
and the rest of the estate continued to be with Sound
Studios. Thereafter, Sound Studios went out of the picture
and the whole estate was let out to National Studios Ltd. on
October 23, 1940 at a monthly rent of Rs. 1700/- for a
period of two years.
In July 1941, National Studios surrendered their lease and
Sheraj Ali became a direct tenant under appellant 1 in
respect of the premises in his possession, called for the
sake of identification, 983/1 (whole) and 983/2 (Ground
floor). On December 1, 1941 and again in November 1942,
Sheraj Ali took on rent additional portions of this estate
so that his original rent, which was Rs. 400/-, was first
increased to Rs. 600/and then to Rs. 700/- and thereafter in
November 1942 to Rs. 875/-. By November 1947, Sheraj Ali
was paying Rs. 1200/- per month as rent for the premises
demised to him including some new structures which had been
built.
Sheraj Ali had taken a loan from M/s. Govind Ram Bros.
Ltd., Respondent 1 on the security of his Film Studio
Equipments. He failed to repay the loan. Thereupon,
Respondent 1 instituted a suit for recovery of the amount
and obtained a decree from the High Court,. on February
27,1948. As a result of the High Court’s decree, the right,
title and interest of Sheraj Ali in the mortgaged property
were assigned to Respondent 1. Respondent 1, in consequence,
took a fresh lease on March 19,1948 from appellant No. 1 of
the, properties (called for identification) 983/1 to 983/12,
which were in the tenancy of Sheraj Ali’, at a contractual
rent of Rs. 1228/- p.m. On the same date, Respondent 1
executed another lease in respect of three rooms in the same
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premises (marked for identification as) 984, in favour of
appellant 1, on a monthly rent of Rs. 750/- Respondent 1
failed to pay the contractual rent, regularly, which fell
into arrears which were not cleared despite the pressing
demands made by the Receiver. On March 13, 1954 the
Receiver wrote to Respondent 1 threatening to take legal
proceedings for the recovery of the rent. This Receiver,
who is now appellant No. 2, had been appointed by the High
Court in Suit No. 454 of 1949 instituted by appellant 1
against the Insurance Company
On April 14, 1954, two applications were filed in the Court
of Small Causes by Respondent 1 for fixation of standard
rent in respect of the premises comprised in the said two
leases one application, R.A.N. 983/54, relates to properties
983/1 to 983/12, and the other (R.A.N. 984) to premises 984.
It was alleged in the applications that since on September,
1, 1940, the entire estate, including the properties in
question. had been let out on a monthly rent of Rs. 1700/-,
standard rent of the premises it question should be fixed on
the basis of apportionment In particular, it was pleaded
that fair rent of Rs. 983/1 to 983/12 should be 1/8th of Rs.
1200/- which was later corrected as 1700/-. On the same
basis it was alleged in the second application, that fair
rent of premises 984 should be Rs. 75/- p. m.
580
The appellants resisted these applications and averred in R.
A. N. 983/54, that several entirely new structures had been
built and substantial alterations made in most of these
structures between the years 1940 and 1948, as a result
whereof the property had lost its identity, and
consequently, fair rent could not be fixed on apportionment
basis.
On June 11, 1958, Respondent 1 made an application for
amendment of the Standard Rent Application (R.A. N. 983154)
for adding an alternative ground based on the value of the
land and cost of construction so that in the event of the
court holding on the preliminary issue in favour of the
appellants, the standard rent could be fixed on the basis of
the valuation of the land and the construction. This
application was disallowed.
On July 30,1958 Respondent 1 made an application for
amendment of his R. A. N. 984 of 1954 on lines similar to-
that in R. A. N. 983/54. It was also dismissed by an order,
dated July 31, 1958.
At the stage of arguments on December 4, 1958, Respondent 1
moved another application for amendment and addition of the
plea that they were the owners of the structures in premises
983/10, 983/1] and 983/12. The second amendment was not
sought to be made in the other application R. A. N. 98411954
relating to property 984. This prayer was also declined.
The trial court (Samson J.) by its judgment dated April 2,
1959, found that the premises in question on account of
structural alterations had undergone such a change that they
could no longer be identified with the property that existed
in September 1940 and that the mode of ,determining rent by
apportionment was not available to the tenants. In the
result he dismissed the applications, adding "there is no
sufficient ,material to ascertain the standard rent in any
other way ’.
Against those orders, Respondent 1 filed a revision petition
under s. 129 (3) of the Act before the Revisional Court of
Small Causes, Bombay, which accepted, the same set aside the
order of the trial judge, allowed the amendment and remanded
both the applications for fixation of fair rent to the trial
court.
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Against this remand order, dated August 8, 1960, of the
Revisional Court, the appellants preferred two Civil
Revisions to the High Court of Bombay.
During the pendency of those Revisions, the trial court
allowed the amendment and proceeded to decide the entire
matter afresh. These facts were brought to the notice of
the High Court, which, however, ,dismissed the revision
petitions by a judgment dated February 3, 1961 holding that
the first Revisional Court had, in fact, remanded the entire
matter for trial de novo, after rightly allowing both the
amendments.
After the remand, the trial court by its judgment, dated
April 25, 1961 held that except 983/10, 983/11 and 983/12,
which were new structures there was no change of identity in
the rest of the properties
581
i. e. 983/1 to 983/9; that new structures 983/10, 983/11
and 983/12 belonged to Respondent 1 who was consequently,
liable to pay rent only for the land underneath; that the
cost of repairs of the properties, 983/8 and 983/9 after
they had been destroyed by fire, was mainly borne by
Respondent 1, the landlord’s contribution being Rs. 8,500/-
only. Applying the principle of apportionment, it fixed the
standard rent of the properties 983/1 to 983/12 at Rs. 400/-
p.m. subject to permitted increases after 1954.
Regarding the premises 984(in R.A.N.984/54), the trial court
gave are turn on the investment of Rs.40,000/-made by the
landlord inclusive of the cost of structure and the value of
land underneath at Rs. 30/- per sq. yard (as that of 1940)
and fixed the standard rent at Rs. 386/- p. m. subject to
permitted increases after 1946.
Aggrieved by these orders of the trial court, appellants and
Respondent 2 filed two revision applications under s. 129
(3) to the Revisional Court of Small Causes which by its
judgment, dated September 30, 1964, substantially upheld the
findings of the trial court, inter alia with the exceptions
: (i) that the ownership of the new structures 983/10,
983/11 and 983/12 vested in Appellant 1, who was entitled to
get a fair return on that investment; (ii) that the value of
the land "married" to the new structures 983/10, 983/11 and
983/12, and 984/54, should be taken at Rs. 50/- per sq. yd.,
i. e. as of 1948 and not as of 1940 as had been done by the
trial court on remand. In the result, the standard rent in
R.A.N. 983 was raised to Rs. 981 /- and in R.A.N. 984 to
Rs.411/-p.m.
To impugn the decision, dated September, 30, 1964, of the
Revisional Court, the parties preferred six Special Civil
Applications under Art. 226/227 of the Constitution to the
High Court. By a common order, a learned single Judge of
the High Court dismissed these applications except that he
corrected some arithmetical errors and, in consequence,
fixed the standard rent of properties 983/1 to 983/12 at Rs.
841.07 and that of premises 984/54 at Rs. 462/11 p. m.
It is against this decision dated 12/13th October 1971 of
the High Court that these appeals have been filed by special
leave.
The first contention of Mr. Cooper, learned Counsel for the
appellants is that there is no provision in the Act which
requires standard rent to be fixed on apportionment basis;
rather, the definition of "premises" in s. 5(8) (b) which
speaks of "part of a building let separately," read with
clause (i) of s. 5(10) and clause (c) of s. 11 (1) with due
emphasis on the article ’the’ immediately preceding the,
word ’premises’ in the said clauses, indicates that the
standard rent would be the rent for which the suit premises
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were first let separately on or, after the basic date i.e.
September 1, 1940. If on the basic date-proceeds the
argument-the premises in question did not form the subject
of a separate, single ,demise but had been let out together
with other portions of larger premises, its standard rent
could not be determined on the footing of the rent payable
for those different portions. Reliance
582
has been placed on Dhanrajgirji Naraingirji v. W. G.
Ward;(1) and Bata Shoe Co’ Ltd. v. Narayan Das Mullick and
Ors.(2) Counsel had further tried to distinguish Capital and
Provincial Property Trust Ltd. v. Rice(3) and Bhikaji
Ramchandra Paranjpe v. Vishnu Ramchandra Paranjpe(4),
referred to in the judgment of the High Court.
On the other hand, Mr. Lokur, learned Counsel for Respondent
maintains that the principle of apportionment has always
been accepted by the Bombay High Court as an appropriate
guide in fixing standard rent under the Act of premises
which on the basic date had been let out as part of a larger
entity. It is pointed out that in Narayanlal Bansilal v.
Venkatrao Anant Rai(5); a Bench of the High Court while
considering the question of standard rent in respect of
another portion of the very property of the appellant-Mills,
had invoked this principle.
Before we deal with the contentions canvassed, it will be
proper to make a brief survey of the relevant provisions of
the Act:
The material part of the definition of "premises" in s.5(8)
reads:
"Premises" means:-
(a) any land not being used for agricultural purposes;
(b) any building or part of a building let
separately. . . ."
(emphasis supplied)
Sub-section (10) of the same Section defines "standard
rent", in relation to any premises, to mean-
(a) where the standard rent fixed by the court and the
Controller respectively under the Bombay ]tent Restrictions
Act, 1939 or the Bombay Rents, Hotel Rates and Lodging House
Rates (Control) Act, 1944, such standard rent; or
(b) Where the standard rent is not so fixed/subject to the
provisions of section 11,
(i) the rent at which the premises were let on the first
day of September 1940, or
(ii) where they were not let on the first day of September
1940, the rent at which they were last let before that day,
or
(iii) where they were first let after the first day of
September 1940, the rent at which they were first let, or
(iv) in any of the cases specified in section 11, the rent
fixed by the Court;
(1) [1925] 27, Bom. L.R. 877. (2) A.I.R. 1953 Cal. 234.
(3) [1952] Appeal Cases 142. (4) 56 Bom. L.R. 402.
(5) 67 Bom. L. R. 352.
583
Section 1 1 empowers the Rent Court to fix the standard rent
at such amount, as having regard to the provisions of this
Act and the circumstances of the case, the court deems just-
(a) where any premises are first let after the first day of
September 1940, and the rent at which they are so let is in
the opinion of the Court excessive; or
(b) where the Court is satisfied that there is no
sufficient evidence to ascertain the rent at which the
premises were let in anyone of the cases mentioned in sub-
clause (i) to (iii) of clause (4) of sub-section (10) of
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section 5; or
(c) Where by reason of the premises having been let at one
time as a whole or in part and another time in parts or a
whole, or for any other reasons, any difficulty arises in
giving effect to this part; or
(d) Where any premises have been or are let rent free or at
a nominal rent or for some consideration in addition to
rent; or
(e) Where there is any dispute between the land-lord and
the tenant regarding the amount of standard rent."
Clause (c) read with the opening part of s. 11(1) is crucial
for our purpose.
One of the primary objects of the Act is to curb exaction of
extortionate rents and to stabilise the same at prewar
level. In achieving that object, however, it avoids a
Procrustean or mechanical approach. While pegging the basic
line to September 1, 1940, it significantly subordinates
"standard rent" by its very definition in s. 5 (10) (b) to
the benignant jurisdiction of the Court under s.11. And the
key words of the latter provision, into which the conscience
of this anti-rack-renting statute is compressed, are "the
circumstances of the case, the Court deems just". These
words inhibit a rigid and ossified determination of
"standard rent". They leave sufficient "play at the
joints", investing the court with a wide discretion in the
matter.
According to the scheme of the Act, while "rent" recoverable
by the landlord, may owing to permitted increases,
fluctuate, the ’standard rent’ always remains fixed or
stationary.
If on the basic date, the suit premises were not let out
separately but were a part of the subject-matter of a larger
demise-as in the instant case-difficulty arises in giving
effect to the statute. Clause (c) of s. II (1) then comes
into operation. To resolve the difficulty this clause and
the related provisions are not to be construed in a narrow
technical sense which would stultify or defeat their object.
It is to be interpreted liberally in a manner which would
’advance the remedy’, ’suppress the
584
mischief, and foil ’subtle inventions and evasions’ of the
Act. Construed in accordance with this socially relevant
rule in Hayden’s case the meaning of ’the premises’ having
been let at one time as a whole, spoken of in this clause,
can legitimately be deemed to cover’ the larger premises
which, on the basic date, had been let as a: whole and of
which the suit premises was a part let out subsequently. In
any event, the amplitude of the phrase "or any other reason"
in the latter part of the clause, is wide enough to embrace
cases of this kind and confers a plenary curative power on
the Court.
True, that unlike the English Rent Control Act of 1920 or
the later English Acts, the (Bombay) Act does not expressly
speak of apportionment. But the language of its relevant
provisions construed consistently with the scheme and in
built policy of the Act, is elastic enough to permit the
fixation of standard rent on apportionment basis. As
noticed already, s. II (1) gives a discretion to the Court
to fix such amount as standard rent as it "deems just".
However, in exercising this discretion the Court has to pay
due regard to (i) the provisions of the. Act and (ii) the
circumstances of the case.
Apportionment or equal distribution of the burden of rent on
every portion-is a rule of justice and good sense. If the
standard rent of a whole was a specific amount, it stands to
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reason that the standard rent of a part or sub-division of
that whole should not ordinarily exceed that amount.
Therefore, if in the circumstances of a given case the Court
feels that for securing the ends of justice and giving
effect to the provisions and policy of the Act, it is
reasonably necessary and feasible to work out the standard
rent by apportionment, it can legitimately do so. This
principle, however, is applicable where on the basic date,
that portion of which the standard rent is to be determined,
had not been let separately as on unit, but the whole, of
which it is a part, had been let on that date.
Apportionment postulates that on account of its having been
let on the basic date, the whole had acquired a standard
rent which has to be allocated to smaller units subsequently
carved out of it.
It is thus clear that the principle of apportionment is not
alien to the spirit of the Act, and has indeed been often
invoked by the courts in fixing standard rent under this
Act. In Narayanlal Bansilal’s case (supra), a Division
Bench of the Bombay High Court determined standard rent of
another part of this very estate of the Mills in accordance
with that principle.
However, while conceding that apportionment is not foreign
to the scheme, purpose and policy of the Act, we will like
to emphasise the need for caution and circumspection in
invoking it. It is not to be rigidly and indiscriminately
applied as a cast-iron rule of law regardless of time and
circumstances or the equities of the case. A doctrinaire
approach, not consistent with a just and fair determination,
stultifies the whole salutary purpose of justice to both,
the landlord and the tenant. If necessary, it can be
adjusted, adapted and attuned in the light of the particular
circumstances of the case, to satisfy the statutory
requirement of
585
fixing the standard rent as at a "just amount. Thus if
after the material date, the landlord has made investments
and improvements in the promises, it will be just and
reasonable to take that factor also into account and to give
him a fair return on such investments. Further, in appor-
tioning the rant, the Court must consider other relevant
circumstances, such as "size, accessibility, aspect, and
other ’Physical advantage enjoyed by the tenant of the
premises of which the standard rent is in question, as
compared with those of the rent of the property in which it
is comprised [see Bainbridge v. Contdon(1)]. Where after
the basic date, the premises completely change their
identity, apportionment as a method of determining just
standard rent, loses its efficacy and may be abandoned
altogether. We have only illustrated, not exhaustively
enumerated the relevant circumstances and their
implications.
At this stage, we may notice the decisions in Danrajgirji v.
W.C. Ward (supra) and Bata Shoe and Co. v. Narayan Dass
(supra) relied upon by Mr. Cooper.
In the first, a learned single Judge of the Bombay High
Court was considering ss. 2(1)(a) and 13(1)(a) of the Bombay
Rent (War Restriction Act II of 1918), which were, to an
extent, similar to sections 5(8)(b) and (10) and 11(1)(c) of
the 1947-Act. There, the Port Trust had in March 24,1915,
leased the building known as Watson’s Annexe to one Dr.
Billimoria at a rental of Rs. 2,850, besides ground rent and
taxes. Dr. Billimoria sublet the premises in different
flats to different tenants. The premises in the occupation
of the defendant were sublet to him at a rental of Rs. 75/-
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in September, 1915, i.e. before September 1, 1916 which was
the basic date under the 1918-Act. The tenancy of Dr.
Billimoria was terminated by a consent decree on July 31,
1923 and thereafter, the defendant held directly under the
plaintiff. The question arose as to whether standard rental
of the flat should be calculated on the basis of the actual
rent of Rs. 75/-, on the basis of the subletting or whether
it should be determined by apportionment of the rent which
Dr. Billimoria was paying to the Port Trust on the basis of
the first letting. Pratt J answered this question thus:
"The Rent Act itself in the definition of the
premises refers to a part of the building
separately let as premises of which the
standard rent has to be determined and such
standard rent must be determined with
reference to those premises in the manner spe-
cified by s 2(1)(a) of the Act. The standard
rent, therefore, must be ascertained on the
admitted basic rent of Rs. 75./....... Again,
if the head-lease instead of being as here the
lease of one building consisting of flats had
been a lease of a large number of buildings
constituting a large estate, it would be
almost impossible to make a correct
apportionment of the rent. I do not think it
was the intention of the Rent Act that
landlords and tenants should be driven to do a
difficult and expensive process of valuation.
and calculation before their rent could be
ascertained."
(1) [1925] 2 K. B. 261.
M45Sup.CI/75
586
We see force in the argument as also textual and pragmatic
support. But these considerations do not preclude the Court
from importing the flexible factors of fairness suggested by
the circumstances of the case. Indeed, s. 11, as explained
earlier, obliges the Court to do it. Moreover, the
interpretation of "premises" adopted by the learned judge
was a little too literal, narrow and divorced from the
purpose and content of the provisions relating to fixation
of standard rent. Nor was it in accord with the scheme and
object of the 1918-Act. The court’s jurisdiction to
consider, as a strong circumstance, proper apportionment of
rent is not taken away, in our view.
It may be noted that just like the opening clause of s. 5 of
the 1947Act, which defines "premises" "standard rent" etc.,
the corresponding s. 2(1) of the 1918-Act, also, started
with the qualifying words "In this Act, unless there is
anything repugnant in the subject or context". While
applying these definitions to particular cases and
provisions of the Acts, these words should not be lost sight
of. The argument in favour of adopting the restricted
interpretation, ignores this rider to the definitions,
provided by the Legislature in these statutes.
We do not intend to over-burden this judgment with a
discussion the decision in Bata Shoe & Co’s case (supra).
Suffice it to say that is a decision under the West Bengal
Premises Rent Control Act (17 of 1950) which stands on its
own facts. It cannot be accepted as laying down a rule of
universal application. It is vulnerable, more or less on
the same grounds, on which the decision in Dhanrajgirji’s
case can be assailed.
We reject the narrow interpretation of the relevant
provisions of Ss. 2 and II, canvassed for by the appellants,
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for two reasons: Firstly, it will leave the door wide open
for evasion of this statute by what Abbot C. J. in Fox v.
Bishop of Chester(1)-called "shift or contrivance" All that
a greedy landlord, need do to squeeze out more rent would be
to divide his premises into several parts and let them out
separately on exorbitant rents. Such an evasion may amount
to a fraud upon the statute. Secondly, such a construction
so manifestly subversive of one of the primary objects of
the Act would be wholly beyond the intendment of the
Legislature.
For reasons aforesaid we would negative the first contention
of Mr. Cooper, as an inflexible proposition and answer the
first part of the question posed in the affirmative to the
extent indicated. it takes us to the second part of that
question namely whether the principle of apportionment was
correctly applied to the fact, of the case ?
Mr. Cooper contends that the first trial court (Samson J.)
had rightly found that the premises in question on account
of extensive alterations and constructions undergone a
complete change after the basic date, and therefore standard
rent could not be determined by apporoining the rent of the
whole among the parts. It is maintained that
(1) (824) 2 B & C 635 at 655.
587
this finding of Samson J. was wrongly set aside by the High
Court and must be deemed to be still holding the field.
Objection is also taken to the amendments allowed by the
trial court on remand. In the alternative, it is argued
that even the courts below found that properties 983/10,
983/11, 983/12 and 984/54 were admittedly new structures and
extensive repairs and replacements had been made in the
remaining suit premises which had been destroyed or severely
damaged by fire in 1948-49. On account of these substantial
alterations and reconstructions the premises in question had
lost their identity and consequently, the principle of
appointment was not applicable.
The first part of the contention based on the judgment of
Samson J. is groundless. The judgment of the first trial
court was set aside in toto by the Revisional Court, and
further by the High Court and the case was remanded for de
novo trial to the trial court which thereafter, decided the
case afresh after allowing the applicant to amend his R.A.
N.S. It is too late in the day any way to argue on the
assumption that the findings still survive.
The question whether a certain property has changed its
identity after the basic date is largely one of fact. The
courts below have found that excepting properties 983/10,
983/11,983/12 and 984/54 which were admittedly new
structures contracted near about 1948, the rest of the
properties, namely 983/1 to 983/9 had not lost their
identity. The courts therefore, worked out the economic
rent of these new structures by capitalising their value and
gave the landlord a fair return on Ms investments and fixed
their standard rent mainly on that basis. It was with
regard to the unchanged old properties 983/1 to 983/9 that
the High Court and the Revisional Court mainly adopted the
method of appointment. Even so, it allowed the landlord
fair return over Rs. 14,448/- being the cost of flooring,
ceiling and other fixtures fixed to property 983/6. Now it
is not disputed that on the basic date (September 1, 1940),
these properties in question were parts of a larger entity
comprised in a single lease or tenancy in favour of Sound
Studios at a monthly rent of Rs. 1700/-. The courts below
have therefore taken into account this basic circumstance
along with the other relevant facts of the case. We do not
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find anything so wrong or unfair or untenable in the method
adopted by them which would warrant an interference by this
Court in the exercise of its special jurisdiction under Art.
136 of the Constitution. Not that apportionment must be
applied in all cases as a rule of law but that, if applied
along with other considerations dictated by a sense of
justice and fairplay, cannot be condemned by this Court as,
illegal. We therefore, overrule this contention, also.
Lastly, it is contended that the courts below have seriously
erred in evaluating the land under the suit properties at
Rs. 30/- per sq. yd. on the basis of an instance (Ex. R 6)
of the year 1942, while they should have taken into account
the value of the land as in the year 1948. it is added that
some photostat co-pies of sale-deeds pertaining to the rele-
vant year were produced by Mr. Deweja, architect examined by
the Landlord, and the Revisional Court wrongly rejected them
As unproved. it is maintained that in 1948, the market value
of the site underneath the
288
structures was Rs. 120/- per sq. yd. in support of his
contention that the value of the land at the date of the
letting is the appropriate value to be taken into account,
Counsel has cited Bukmanibai Khunji Cooverji v. Shivnarayan
Ram Ashre. (1).
We are unable to accept this contention also. The courts
below in capitalising the structures, 983/10 to 983/12 and
984/54 did take into account the value of the land married
to those properties at the rate of Rs. 50/- per sq. yd;
which, according to their estimate, after adding Rs. 30/-
per sq. yd for escalation, would be the market value of that
land in the year 1948. Since the rent of the old unchanged
properties 983/1 to 983/9 was fixed mainly on apportionment
basis, the courts did not think it necessary to take the
value of their sites separately into computation in fixing
the standard rent. Moreover, there was no evidence on the
record to show that the value of the land in question, in
the year 1948 was Rs. 120/- per sq. yd. We, therefore, do
not think it necessary to examine Cooverji’s case cited by
the Counsel. We however, do not rule out the propriety of
paying regard to escalations in land value as put forward by
Mr. Cooper, but do hold that this Court will be loath to re-
investigate factual conclusions not shown to be perverse or
manifestly unjust. Such is not the case here.
For all the foregoing reasons, we would answer the question
posed for decision.in the affirmative and dismiss these
appeals with one set of costs.
V.P.S.
Appeals dismissed
(1)(1966)67 Bom. L.R. 692.
589