HARBANS KAUR versus IQBAL SINGH & ANR. on 29 January 2019

HARBANS KAUR

v.

IQBAL SINGH & ANR.

(Civil Appeal Nos. 12561-12562 of 2017)

JANUARY 29, 2019

[ASHOK BHUSHAN AND K.M. JOSEPH, JJ.]

Rajasthan Rent Control Act, 2001 – ss.4, 6, 7 & 14 – Defaultin payment of rent – Appellant-landlord let out shops to therespondent-tenant at the rent of Rs.8,500/- per month – Rent deeddated 19.08.1995 executed between the parties, contained a clausefor yearly increase of rent by 10% – Accordingly, tenant paid theagreed rent with 10% enhancement yearly – In 2003, tenant waspaying rent at the rate of Rs.16,564/- per month – In April 2003,tenant made payment upto month of July at the rate of Rs.16,564/-per month – Thereafter, tenant committed default in payment of rent– Appellant-landlord issued notice dated 27.03.2004 demandingarrears from 01.08.2003 to 29.02.2004 amounting toRs.1,15,945/- calculated @ Rs.16,564/- per month rent for periodof seven months – Tenant deposited Rs. 95,200/- on 26.04.2004and took the stand that in accordance with provisions of Act, 2001w.e.f. 01.04.2003, on increasing the rent under the provisions ofs.6, the prescribed rent of Rs.8500/- month @ 7.5% p.a. from01.04.2003 comes to Rs.13,600/- p.m. – Accordingly, tenantdeposited rent amount of Rs.95,200/- – Rent Tribunal held that thecase of tenant that rent is payable @ 13,600/- p.m. cannot beaccepted and directed for eviction of tenant – Same was upheld byAppellate Tribunal – However, High Court held in favour of thetenant – On appeal, held: s.6 of the Act, 2001 empowers the landlordto obtain revision of rent and to calculate the rent from date ofinitiation of tenancy – But in the event landlord does not choose toinvoke the machinery of revision of the rent as provided in s.6 ands.14, the agreed rent between the parties shall not automatically bechanged nor the tenant can unilaterally revise the rent – Further,s.4 of the Act which deals with the agreed rent, provides that rentpayable for any premises shall subject to the provisions of this Act,be such as may be agreed between the landlord and the tenant –

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AIn the instant case, tenant was paying the rent of Rs.16,564/- permonth before the enforcement of the Act as per the rentagreement – Said amount of Rs.16,564/- per month was agreedamount which was being paid before the enforcement of the Act –The arrears demanded by the notice dated 27.03.2004 i.e.Rs.16,564/- per month starting from August, 2003 to February, 2004Btotalling Rs.1,15,945/- were required to be paid by the tenant andhaving paid only Rs.95,200/- as per his calculation of the rent atthe rate of Rs.13,600/- per month, he has committed default – Also,landlord had not added 10% increase in the rent demanded,therefore, there was no breach of s.6 – High Court has committedCerror in allowing the writ petition of the tenant – Order of the RentTribunal restored.Rajasthan Premises (Control of Rent and Eviction) Act, 1950– s.6 – Rajasthan Rent Control Act, 2001 – s.6 – Held: A comparisonof scheme of s.6 as it existed in Act, 1950 and s.6 as it broughtDunder Act, 2001 makes it clear that although the tenant under theold Act was entitled to apply for fixation of standard rent if the rentwas excessive whereas u/s.6 of the Act, 2001 tenant has not beengiven any right to pray for reduction of the rent.

Rajasthan Rent Control Act, 2001 – s.9 – Notice by landlordEdemanding arrears of rent – Plea of tenant to relieve him fromeviction – Tenability of – Held: In the present case arrears demandedby the notice i.e. Rs.16,564/- per month starting from August, 2003to February, 2004 totalling Rs.1,15,945/- were required to be paidby the tenant and having paid only Rs.95,200/- as per his calculationof the rent at the rate of Rs.13,600/- per month has committed defaultF– Order of the Rent Tribunal directing eviction of the tenant restored.Rajasthan Rent Control Act, 2001 – ss.4, 6, 7 , 9 & 14 –Discussed.

Allowing the appeals, the CourtGHELD: 1. The important differences between the statutoryscheme as contained in Section 6 of Rajasthan Premises (Controlof Rent and Eviction) Act, 1950 and as now contained in RajasthanRent Control Act, 2001 are: (i) Under the old Act the landlord orthe tenant both were entitled to file a suit for fixation of standard H

rent, if it is claimed that rent is either low or excessive. Thus,landlord could have moved the Court for enhancement of therent and equally the tenant could have instituted a suit in theevent the rent was excessive and the Court after holding inquirywas to determine the standard rent for such premises; (ii) InSection 6 of Act, 2001 the tenant has not been given any right toapply for revision of the rent on any ground. The old Act did notcontain any prohibition regarding the annual increase of rentwhereas Section 6 now contains the prohibition, restricting annualincrease only by 5% for both the tenancies which were in existenceprior to enforcement of the Act as well as tenancies whichcommenced after the commencement of the Act, 2001.[Para 13] [544-G, H; 545-A-C]

2. Sub-section (4) of Section 6 of the Act 2001, furtherprovides that rent revised as per formula given under sub-section(1) and sub-section (2) shall be payable, after the commencementof this Act from the date agreed upon between the landlord andthe tenant or where any revision petition is filed, from date offiling of such petition. [Para 16] [546-A]

3. Section 14 of the Act, 2001 contains procedure forrevision of rent which provides that landlord may seek revisionof rent under Section 6 and 7 by submitting a petition before theRent Tribunal accompanied by affidavits and documents, if any.Section 14 sub-section (1) uses the words “landlord may seekrevision”. It is not obligatory for every landlord to seek revisionof rent in accordance with Section 6. Section 6 contains provisionentitling landlord to seek revision of rent notwithstanding anythingcontained in any agreement between landlord and tenant. Section6 empowers the landlord to obtain revision of rent and to calculatethe rent from date of initiation of tenancy. But in the event landlorddoes not choose to invoke the machinery of revision of the rentas provided in Section 6 and Section 14, the agreed rent betweenthe parties shall not automatically be changed nor the tenant canunilaterally revise the rent. Section 6 is also beneficial to thetenant to the extent that any contrary agreement between theparties to increase the rent annually more than as provided underSection 6 cannot be enforced by a landlord after the enforcement A

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Aof the Act. In the event landlord applies for revision of the rent,the revision of rent has to be in accordance with the formula asprovided under Section 6(1) and 6(2) of the Act. The statutoryscheme does not indicate that the tenant can unilaterally computethe rent as per formula under Section 6(1) from the inception ofthe tenancy and reduce the amount of rent which he was payingBimmediately before the enforcement of the Act. In the presentcase, the tenant has come up with the case in his written statementthat he has recomputed the rent from inception of tenancy andhas arrived at calculation that the rent payable with effect fromthe enforcement of Act, 2001 was Rs.13,600/- only and relyingCon the said computation he deposited an amount of Rs.95,200/-in response to the notice. [Para 17] [546-B-G]

4. Section 4 of the Act which deals with the agreed rentprovides that rent payable for any premises shall subject to theprovisions of this Act, be such as may be agreed between theDlandlord and the tenant. When the tenant was paying the rent ofRs.16,564/- per month before the enforcement of the Act as perthe rent agreement, the said amount was agreed amount whichwas being paid before the enforcement of the Act. It is true thatin the agreed amount which was being paid immediately before

the commencement of the Act, the landlord cannot increase @E10% of the rent as per agreement. The increase after theenforcement of the Act shall be in accordance with Section 6 andin the event the tenant does not agree for the said increase, thelandlord is free to file application under Section 6 read withSection 14. Thus, the High Court has not appreciated the trueFimport of Sections 6 and 7 of the Act, 2001 in observing that thetenant is not in default. [Para 20] [547-F-H; 548-A]

5. In the present case arrears demanded by the notice i.e.Rs.16,564/- per month starting from August, 2003 to February,2004 totalling Rs.1,15,945/- were required to be paid by the tenant,Gthe tenant having paid only Rs.95,200/- as per his calculation ofthe rent at the rate of Rs.13,600/- per month has committed default.According to the tenant, the rent paid by the tenant was sufficientto cover the rent upto December, 2003 and part of January, 2004,admittedly, the arrears as demanded having not been paid andthe Court having found that the landlord has demanded arrearsH

of rent for seven months according to rate of rent Rs.16,564/-per month which was being paid by the tenant even before theenforcement of the Act, 2001 and after the enforcement of theAct, 2001. The landlord having not added 10% increase in therent demanded, there was no breach of Section 6 and the HighCourt has committed error in allowing the writ petition of thetenant. [Para 24] [550-D-F]

Prakash Mehra v. K.L. Malhotra (1989) 3 SCC 74 :[1989] 2 SCR 744 – referred to.

Case Law Reference

[1989] 2 SCR 744

referred toPara 23

CIVIL APPELLATE JURISDICTION : Civil Appeal Nos.12561-12562 of 2017.

From the Final Judgment and Order dated 09.10.2014 and14.12.2015 of the High Court of Judicature for Rajasthan at Jaipur Bench,Jaipur in S.B. Civil Writ Petition No.6965 of 2014 and D.B. SpecialAppeal (Writ) No.2075 of 2014 in S.B. Civil Writ Petition No.6965 of2014 respectively.

Puneet Jain, Abhinav Deshwal, Harsh Jain, Ms.Pratibha Jain,Advs. for the Appellant.

Abhishek Singh, Shreasth Arya, Advs. for the Respondents.

The Judgment of the Court was delivered by ASHOK BHUSHAN, J. 1. These appeals have been filed bythe appellant, the landlord of the premises in question, challenging thejudgment of the Rajasthan High Court dated 09.10.2014 allowing thewrit petition filed by the tenant setting aside the order of eviction passedby Rent Tribunal as well as Appellate Rent Tribunal. Division Bench ofthe Rajasthan High Court vide its judgment dated 14.12.2015 dismissedthe Special Appeal(Writ) of the landlord as not maintainable.

2. Brief facts of the case necessary to be noticed for decidingthese appeals are:

The appellant is landlord of Shop No.3 and 4 in Plot No.362 whichwas let out to the respondent-tenant in August, 1995 at the rent ofRs.8,500/- per month. A Rent Deed dated 19.08.1995 was executed A

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Abetween the parties. Rent deed contained a clause for yearly increaseof rent by 10%. The tenant continued to pay rent to the landlord as perthe agreed rent with 10% enhancement yearly. In the year 2003 thetenant was making payment of rent at the rate of Rs.16,564/- per month.In April, 2003, rent which was paid by the tenant was Rs. 16,564/-, uptoJuly, 2003 the tenant paid the rent at the rate of Rs.16,564 per month.BThe landlord issued notice dated 27.03.2004 stating that with effect from01.08.2003 upto 29.02.2004, for a period of seven months, the tenanthas neither paid or tendered rent, arrears from 01.08.2003 to 29.02.2004amounting to Rs.1,15,945/- were asked to be deposited in the bank accountof landlord. Notice mentioned that in the event the tenant does not depositCthe amount in the account, landlord shall be compelled to carry out legalproceedings for eviction of the tenant. After the aforesaid notice dated27.03.2004 the tenant deposited an amount of Rs.95,200/- on 26.04.2004in the bank account of the landlord. Landlord filed an Application No.1258of 2004 under Section 9 of the Rajasthan Rent Control Act, 2001

(hereinafter referred to as the “Act, 2001”) praying for eviction on theDground of arrears of rent. The tenant filed reply opposing the abovesaidapplication. The tenant took stand in the application that in accordancewith the provisions of Act, 2001, which has come into effect from01.04.2003, on increasing the rent under the provisions of Section 6 inthe prescribed rent of Rs.8,500/- @ 7.5% per annum the rate of rentEfrom 01.04.2003 comes to be Rs.13,600/- per month. It was stated Inthe written statement that tenant has deposited rent upto February, 2004@ Rs.13,600/- per month i.e. a total of Rs.95,200/- in the bank account.

3. Rejoinder was filed by the landlord where it was pleaded thatrespondent-tenant has been paying rent from August, 2002 @FRs.16,564/- per month which rent was paid till July, 2003. It was claimedthat the respondent-tenant is liable to pay rent @ Rs.16,564/- per month.The Rent Tribunal heard the parties and by its judgment and order dated22.04.2011 directed for eviction of the tenant. The Rent Tribunal heldthat the case of tenant that rent is payable @ Rs.13,600/- per monthcannot be accepted. The tenant having not deposited at the rate ofGRs.16,564/- per month, has committed default in paying rent. An appealwas filed by the tenant before the Rent Appellate Tribunal which toowas dismissed by order dated 15.01.2014. The order of the Rent Tribunalwas upheld. The tenant aggrieved by the order of the Appellate Tribunalfiled Writ Petition No.6965 of 2014 in the High Court which writ petitionH

was allowed by the learned Single Judge vide its judgment and orderdated 09.10.2014. Against the judgment of the learned Single Judge dated09.10.2014 Special Appeal (Writ) No.2075 of 2014 was filed which wasdismissed by the Division Bench vide its judgment dated 14.12.2015holding writ appeal as not maintainable. Aggrieved against the judgmentsof the High Court landlord has filed these appeals.

4. Learned counsel for the appellants submits that the High Courtcommitted error in interpreting the provisions of Sections 4, 6, 7 and 14of the Act, 2001. He submits that the rent which was being paid by thetenant on the enforcement of the Act i.e. w.e.f. 01.04.2003 wasRs.16,564/- per month, the tenant was liable to pay the rent at the samerate. It is not the case of the appellants that they are demanding rentwith the hike of 10% after the enforcement of Act, 2001. The tenant,however, is calculating the rent by revising the rent with effect fromyear 1995 as per the provisions of Section 6 of the Act. The tenant’scase that rent payable was Rs.13,600/- per month is erroneous. By thenotice given by the landlord dated 27.03.2004 an amount of Rs.1,15,945/-which was due from August, 2003 to February, 2004 was demanded atthe rate of Rs.16,564/- per month. The tenant having not deposited thedue amount and having deposited amount of only Rs.95,200/- on26.04.2004 has committed default. The rent which was being paid onthe date of the commencement of the Act, 2001, shall be treated asagreed rent between the parties. There is change in the statutory schemeof Act, 2001 which now entitles landlord to seek revision of the rent. Asper the provisions of Act, 2001 the tenant has not been given a right toget revision of the agreed rent under the statutory scheme.

5. Learned counsel for the respondent refuting the submission ofthe learned counsel for the appellants submits that the High Court hasrightly taken the view that the landlord was not entitled to enhancementof the rent more than 5% in view of the Act, 2001. The landlord was notat liberty to claim rent with enhancement at the rate of 10% per annum.The High Court had rightly held that permitting the landlord to demandrent with increase of 10% shall be contrary to the Section 6 of the Act,2001. Any agreement cannot be given effect if it provides the revision ofrent above @ 5%. Learned counsel for the respondents additionallysubmitted that in the event the rate of rent as claimed by the landlord isaccepted the agreed rent, after the receipt of the notice by the tenant,tenant has deposited amount of Rs.95,200/-, which covered rent upto A

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ADecember, 2003 and part of rent of January, 2004. The tenant was notin default for four months, hence he could not have been evicted underSection 9 of Act, 2001. He submits that unless there is default for paymentof 4 months rent eviction cannot be ordered. He submits that due to thisreason the orders of eviction were unsustainable and this Court may notinterfere with the judgment of the High Court.B

6. We have considered the submissions of the learned counsel forthe parties and perused the records.

7. We need to look into the statutory scheme of Act, 2001 forconsidering the respective submissions. The Rent Control LegislationCwhich was in operation prior to Act, 2001 also need to be noted forappreciating the changes in law brought by the Act, 2001. The issue inthese appeals pertains to rate of rent and the revision of rent as prescribedby the Act, 2001, hence, only those provisions of both the earlier Act andthe Act, 2001 need to be noted. Act, 2001 has repealed the RajasthanPremises (Control of Rent and Eviction) Act, 1950. We may first noticeDthe provisions of Act, 2001 which are relevant for the present case.Section 4 provides for rent to be as agreed which is to the followingeffect:

“Section 4. Rent to be as agreed. - The rent payable for anypremises shall, subject to other provisions of this Act, be such asEmay be agreed upon between the landlord and the tenant and itshall not include the charges payable for amenities which may heagreed upon separately; and shall be payable accordingly.”

8. Chapter II of the Act, 2001 deals with “Revision of Rent”.Section 6 of the Act (as existing on relevant day) provides as follows:F

“Section 6. Revision of rent in respect of existing tenancies.- (1) Notwithstanding anything contained in any agreement, wherethe premises have been let out before the commencement of thisAct, the rent thereof shall be liable to be revised according to theformula indicated below :- G

(a) where the premises have been let out prior to 1st January,1950, it shall be deemed to have been let out on 1st January, 1950and the rent payable at that time shall be liable to be increased atthe rate of 7.5% per annum and the amount of increase of rentshall be merged in such rent alter ten years. The amount of rentHso arrived at shall again be liable to be increased at the rate of 7.5% per annum in similar manner upto the year ofcommencement of this Act; (b) where the premises have been let out on or after 1st January,1951, the rent payable at the time of commencement of thetenancy shall be liable to he increased at the rate of 7.5% perannum and the amount of increase of rent shall be merged in suchrent after ten years. The amount of rent so arrived at shall againbe liable to be increased at the rate of 7.5% per annum in similarmanner upto the year of commencement of this Act.

(2) Notwithstanding anything contained in Sub-section (1), wherethe period of ten years for merger of increase of rent under Sub-section (1), is not completed upto the year of the commencementof this Act, the rent at the rate of 7.5% per annum shall beincreased upto the year of the commencement of this Act andamount of increase of rent shall be merged in rent.

(3) The rent arrived at according to the formula given in Sub-section (1) and (2) shall, after completion of each year from theyear of commencement of this Act, again be liable to be increasedand paid at the rate of 5% per annum and the amount of increaseof rent shall he merged in such rent after ten years. Such tentshall further be liable to he increased at similar rate and merged insimilar manner till the tenancy subsists.

(4) The rent revised as per formula given under Sub-section (1)or Sub-section (2) shall be payable, after the commencement ofthis Act, from the date agreed upon between the landlord and thetenant or where any petition is filed in a Rent Tribunal, from thedate of filing of such petition.”

9. Section 7 deals with revision of rent in respect of new tenancieswhich is to the following effect:

“Section 7. Revision of rent in respect of new tenancies. -(1)In the absence of any agreement to the contrary, the rent ofthe premises let out alter the commencement of this Act shall beliable to be increased at the rate of 5% per annum and the amountof increase of rent shall be merged in such rent after ten years.Such rent shall further be liable to be increased at the similar rateand merged in similar manner till the tenancy subsists.

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[2019] 2 S.C.R.

A(2) Any agreement for increase of rent in excess of 5% perannum shall be void to that extent.”

10. Section 14 provides the procedure for revision of rent. Section14 sub-section (1) is as follows:

“Section 14. Procedure for revision of rent. - (1) The landlordBmay seek revision of rent under Section 6 or Section 7 by submittingit petition before the Rent Tribunal accompanied by affidavits anddocuments, if any.”

11. Now we notice the relevant provisions as existed in Act, 1950.Section 5 dealt with the payment as agreed rent to the following effect:C

“Section 5. Rent to be as agreed.- The rent payable for anypremises situated within the areas to which this Act extends forthe time being shall, subject to the other provisions thereof, beordinarily such, as may be agreed upon between the landlord andthe tenant.”

D12. Section 6 dealt with fixation of standard rent. Section 6(1) isas follows:

“Section 6. Fixation of standard rent.-(1) Where no rent hasbeen agreed upon or where for any reason the rent agreed uponis claimed to be low or excessive, the landlord or the tenant mayEinstitute a suit in the lowest court or competent jurisdiction forfixation of standard rent for any premises.

(2)..................”

13. In the Act, 1950, Section 7 provided for fixation of provisionalFrent, which provided that upon the institution of a suit under Section 6,the Court shall forthwith make an order fixing in a summary manner aprovisional rent for the premises in question, which shall be binding on allparties concerned and shall remain in force till a decree fixing the standardrent therefor is finally made in such suit.

GThe important differences between the statutory scheme ascontained in Section 6 of Act, 1950 and as now contained in Act, 2001are:

(i) Under the old Act the landlord or the tenant both were entitledto file a suit for fixation of standard rent, if it is claimed that rent isHeither low or excessive. Thus, landlord could have moved the Court for enhancement of the rent and equally the tenant couldhave instituted a suit in the event the rent was excessive and theCourt after holding inquiry was to determine the standard rent forsuch premises.

(ii) In Section 6 of Act, 2001 the tenant has not been given anyright to apply for revision of the rent on any ground. The old Actdid not contain any prohibition regarding the annual increase ofrent whereas Section 6 now contains the prohibition, restrictingannual increase only by 5% for both the tenancies which were inexistence prior to enforcement of the Act as well as tenancieswhich commenced after the commencement of the Act, 2001.

14. The moot question to be answered is as to whether the agreedrent which was being paid by the tenant immediately before thecommencement of Act, 2001 i.e. with effect from 01.04.2003 is liable tobe re-determined as per provisions of Section 6 of Act, 2001 by a tenantand tenant can unilaterally revise the rent under new Section 6. Revertingto the facts of the present case, it is on the record that tenant was payingthe rent of Rs.16,564/- per month immediately before the enforcementof the Act and even subsequently till the month of July, 2003. In the rentagreement there was mutual agreement between the parties for annualincrease @ 10% and the rent of Rs.16,565/- per month was arrived atcomplying @ 10% increase annually to the tenancy which commencedfrom 01.08.1995. As per tenant the rent which was become payableafter the enforcement of the Act has to be re-determined applying Section6 and instead of 10% as agreed between the parties calculation has tobe on the basis of increase at the rate of 7.5% w.e.f. 01.08.1995 as perprovision of Section 6.

15. A comparison of scheme of Section 6 as it existed in Act,1950 and Section 6 as it brought under Act, 2001 makes it clear thatalthough the tenant under the old Act was entitled to apply for fixation ofstandard rent if the rent was excessive whereas under Section 6 of theAct, 2001 tenant has not been given any right to pray for reduction ofthe rent. It is true that Section 6(1) begins with the words “Notwithstandinganything contained in any agreement”. Section 6(1) sub-clause (b)provides for “where the premises have been let out on or after01.01.1950”, the provision contemplates that the rent payable at the timeof commencement of the tenancy shall be liable to be increased at therate of 7.5% per annum.

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A16. Sub-section (4) of Section 6 further provides that rent revisedas per formula given under sub-section (1) and sub-section (2) shall bepayable, after the commencement of this Act from the date agreed uponbetween the landlord and the tenant or where any revision petition isfiled, from date of filing of such petition.

B17. Section 14 of the Act contains procedure for revision of rentwhich provides that landlord may seek revision of rent under Section 6and 7 by submitting a petition before the Rent Tribunal accompanied byaffidavits and documents, if any. Section 14 sub-section (1) uses thewords “landlord may seek revision”. It is not obligatory for every landlordto seek revision of rent in accordance with Section 6. Section 6 containsCprovision entitling landlord to seek revision of rent notwithstanding anythingcontained in any agreement between landlord and tenant. Section 6empowers the landlord to obtain revision of rent and to calculate the rentfrom date of initiation of tenancy. But in the event landlord does notchoose to invoke the machinery of revision of the rent as provided inDSection 6 and Section 14, the agreed rent between the parties shall notautomatically be changed nor the tenant can unilaterally revise the rent.Section 6 is also beneficial to the tenant to the extent that any contraryagreement between the parties to increase the rent annually more thanas provided under Section 6 cannot be enforced by a landlord after the enforcement of the Act. In the event landlord applies for revision of theErent, the revision of rent has to be in accordance with the formula asprovided under Section 6(1) and 6(2) of the Act. The statutory schemedoes not indicate that the tenant can unilaterally compute the rent as performula under Section 6(1) from the inception of the tenancy and reduce the amount of rent which he was paying immediately before theFenforcement of the Act. In the present case, the tenant has come upwith the case in his written statement that he has recomputed the rentfrom inception of tenancy and has arrived at calculation that the rentpayable with effect from the enforcement of Act, 2001 wasRs.13,600/- only and relying on the said computation he deposited anamount of Rs.95,200/- in response to the notice. The High Court in itsGjudgment has held that after the enforcement of the Act, 2001 noagreement can provide for higher revision of rent. The High Court in itsjudgment has made following observation:

“Section 6 of the Act starts with non-obstantive clause, thus noagreement to provide higher or lower rate of revision of rent wouldHoperate after commencement of the Act of 2001.

The landlord was thus not at liberty to claim rent with enhancement@ 10% per annum.”

18. Ultimately, the High Court held following:

“The landlord was entitled to the rent as was payable on the dateof commencement of the Act of 2001 without its revision, in factsand circumstances of this case. In view of above, I find thatdemand of rent based on the agreement was not proper so as toconsider it to be a case of short remittance and default in paymentof rent thereof. In the background aforesaid, the findings of thedefault in payment of rent, recorded by the Rent Tribunal so alsoby Appellate Rent Tribunal cannot be allowed to stand. Theimpugned orders passed by the Rent Tribunal so also by AppellateRent Tribunal are thus, quashed. A case of default in payment ofrent is not made out.”

19. The observation of the High Court that landlord was entitledto the rent as was payable on the date of commencement of the Act,2001 without its revision is perfectly correct. The landlord cannot claimrevision of rent as per agreement at the rate of 10% per annum after theenforcement of the Act. The present is not a case that the landlord isclaiming rent after the enforcement of the Act by adding 10% increasein the rent. The landlord’s case throughout is that the rent at the rate ofRs.16,564/- per month was being paid by the tenant since before thecommencement of the Act and even after the commencement of theAct, till the month of July, 2003 the tenant paid rent at the rate ofRs.16,564/- per month.

20. Section 4 of the Act which deals with the agreed rent providesthat rent payable for any premises shall subject to the provisions of thisAct, be such as may be agreed between the landlord and the tenant.When the tenant was paying the rent of Rs.16,564/- per month beforethe enforcement of the Act as per the rent agreement, the said amountwas agreed amount which was being paid before the enforcement ofthe Act. It is true that in the agreed amount which was being paidimmediately before the commencement of the Act, the landlord cannotincrease @ 10% of the rent as per agreement. The increase after theenforcement of the Act shall be in accordance with Section 6 and in theevent the tenant does not agree for the said increase, the landlord is freeto file application under Section 6 read with Section 14. In view of the A

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Aforegoing discussion, we are of the view that the High Court has notappreciated the true import of Sections 6 and 7 of the Act, 2001 inobserving that the tenant is not in default.

21. One more submission which has been pressed by the tenantto relieve the tenant from eviction has to be considered. Section 9 of theBAct provides for eviction of the tenant which is to the following effect:

“Section 9. Eviction of tenants. - Notwithstanding anythingcontained in any other law or contract but subject to otherprovisions of this Act, the Rent Tribunal shall not order eviction oftenant unless it is satisfied that, - C

(a) the tenant has neither paid nor tendered the amount of rentdue from him for four months :- Provided that the ground under this clause shall not be availableto the landlord if he has not disclosed to the tenant his hank accountnumber and name of the bank in the same Municipal area, in theDrent agreement or by a notice sent to him by registered post,acknowledgment due :

Provided further that no petition on the ground under this clauseshall he filed unless the landlord has given it notice to the tenantby registered post, acknowledgment due, demanding arrears ofErent and the tenant has not made payment of arrears of rent withina period of thirty days from the (late of service of notice.

Explanation.- For the purposes of this clause, the rent shall bedeemed to have been tendered when the same is remitted throughmoney order to the landlord by properly addressing the same;orFhaving been deposited with the Rent Authority;or”

22. Section 9(a) provides that eviction can be ordered only whenthe tenant has neither paid nor tendered the rent due from him for fourmonths. He submits that admittedly after the receipt of the notice dated27.03.2004 demanding arrears of rent of Rs.1,15,945/-, the tenant hasGpaid an amount of Rs.95,200/- which covered the payment of rent uptoDecember, 2003 and part of rent of January, 2004. He submits thatnotice was issued demanding arrears of rent from August, 2003 to29.02.2004 and the rent upto December, 2003 having been depositedthere was no default for four month entitling the landlord to claim eviction.

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23. Section 9 second proviso of Act, 2001 contemplates a noticeby landlord demanding arrears of rent and the tenant has not madepayment of rent within 30 days from the service of the notice. Thewords “arrears of rent” mean the arrears as demanded by notice andthe ground for eviction as contemplated under Section 9(a) is “the tenanthas neither paid nor tendered the amount of rent due from him for fourmonths”. The payment and tendering of rent thus relates to rent for fourmonths. The tenant cannot be heard saying that since although hispayment was done complying the arrears of rent as demanded but sincehe has made the payment upto December, 2003 and the part of January,2004, he should be relieved from eviction. What Section 9 contemplatesis payment or tendering the amount of rent due from him for four months,thus, tendering of payment of rent is rent due from him for four months.In the event rent due from him for four months is not paid the ground ascontemplated under Section 9(a) is made out. We in this context noticea judgment of this Court in Prakash Mehra vs. K.L.Malhotra, (1989)3 SCC 74. In the above case this Court has occasion to consider theprovision of Section 14(1)(a) of Delhi Rent Control Act. The arrearsdemanded by the notice were the arrears which were required to bepaid by the tenant. The High Court has held that Section 14(1)(a) of theAct made out a ground for eviction only where the tenant had neitherpaid nor tendered the whole of the arrears of rent legally recoverablefrom him within two months of the date on which a notice of demand forthe arrears of rent was served on him by the landlord. In the above casethe contention of the landlord was that the rent which was due after thenotice should also be treated to be as defaulted rent which argumentwas not accepted. In paragraph 7 of the judgment following was laiddown:

“7. It is urged before us by learned Counsel for the appellant thatSection 14(1)(a) of the Act contemplates the payment or tenderof the whole of the arrears of rent legally recoverable from thetenant on the date when the demand notice is sent including therent which has accrued after service of the demand notice. Whenthe notice was sent on 7 May 1976, rent for the months of Apriland May 1976 lad become due, and as two months was given forpayment of the arrears, it would include also the rent which hadaccrued during the said period of two months. We are not satisfiedthat there is substance in the contention. The arrears of rent A

B

C

D

E

F

G

H

A

B

C

D

E

F

G

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Aenvisaged by Section 14(1)(a) of the Act are the arrears demandedby the notice for payment of arrears of rent. The arrears duecannot be extended to rent which has fallen due after service ofthe notice of demand. In this case, the two bank drafts representingthe arrears of rent covered by the notice of demand had beentendered within two months of the date of service of the notice ofBdemand. The High Court is right in the view taken by it. We arenot satisfied that the construction placed by B. C. Misra, J. in JagRam Nathu Ram v. Surinder Kumar [S.A.O. No. 52 of 1975decided on 28 April, 1976 (Del)] and in S.L Kapur v.Dr. Mrs. P. D. Lal, [1975 Ren C.J. 322 (Del)] lays down theCcorrect law on the point. “24. This Court in the above case has held that arrears of rent asenvisaged in provision of Section 14(1)(a) of the Delhi Rent Control Actare the arrears demanded by the notice for payment of arrears of rent.In the present case arrears demanded by the notice i.e. Rs.16,564/- perDmonth starting from August, 2003 to February, 2004 totallingRs.1,15,945/- were required to be paid by the tenant, the tenant havingpaid only Rs.95,200/- as per his calculation of the rent at the rate ofRs.13,600/- per month has committed default. According to the learnedcounsel for the tenant, the rent paid by the tenant was sufficient to cover the rent upto December, 2003 and part of January, 2004, admittedly, theEarrears as demanded having not been paid and we having found that thelandlord has demanded arrears of rent for seven months according torate of rent Rs.16,564/- per month which was being paid by the tenanteven before the enforcement of the Act, 2001 and after the enforcementof the Act, 2001. The landlord having not added 10% increase in theFrent demanded, there was no breach of Section 6 and the High Courthas committed error in allowing the writ petition of the tenant.

25. In view of the foregoing discussions, we allow the appeals,set aside the judgment and order of the High Court and restore the orderof the Rent Tribunal.G

Ankit Gyan

Appeals allowed.

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