Tuesday 17 January 2017

When tenant will not be treated as willful defaulter?

Having considered the rival submissions, we are in agreement with
the view taken by the High Court that the evidence on record leaves no
manner of doubt that after receipt of notice from the appellant, the
respondent-tenant immediately rushed to the Rent Controller and took
permission to deposit the amount towards rent of the suit shop. Further,
in terms of the liberty given by the Rent Controller the respondent-tenant
deposited the amount towards rent of the suit shop before the Rent
Controller. That option was resorted to by the respondent-tenant because
of dispute relating to ownership of the suit shop. The High Court justly
adverted to the dictum in the case of Kannan vs. Tamil Tahlir Kalvi
Kazhagam (1998) 5 SCC 21
 - where, in similar situation, the tenant deposited the rent in
Court which was considered as a valid deposit. The fact remains that the

amount towards arrears of rent was deposited by the respondent-tenant
in the Court of Rent Controller on 15th April, 1988 and 25th April, 1988
before institution of the eviction application; and intimation in that
behalf was given to the landlord. The respondent-tenant continued to
periodically deposit the rent amount in Court thereafter. Further, the
appellant in his evidence has admitted of having withdrawn the rent
amount till Diwali 2003. This finding of fact recorded by the District
Court and affirmed by the High Court, being concurrent finding of fact,
need no interference. As a necessary corollary, it must follow that the
respondent-tenant was not a defaulter muchless willful defaulter. Thus,
the ground of default on which eviction of the respondent-tenant was
prayed is untenable.
NON-REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.2606/2013
Baburao s/o Narayanrao Terkar
V
Pokhardas s/o Bhanumal Khatnani 
Dated:August 16, 2016



The application for early hearing is allowed.
2. Appeal is taken up for hearing forthwith, by consent.
3. This appeal challenges the judgment of the High Court of
Judicature at Bombay, Bench at Aurangabad, in Civil Revision No.59 of
2007 dated 6th September, 2011. The High Court dismissed the revision
application preferred by the appellant and thereby confirmed the decision
of the District Court dismissing the eviction application preferred by the
appellant.
4. Briefly stated, the appellant, claiming to be landlord in respect of
suit premises being shop admeasuring east-west 12ft. and south-north
16ft. situated at Municipal house No.23/124/A, corresponding to City
Survey No.9572 in Cloth Lane, Latur, instituted an eviction applicationPage 2
2
against the respondent-tenant on the ground of arrears of rent and
default within the meaning of Section 15 of the Hyderabad Houses (Rent,
Eviction, and Lease) Control Act, 1954. It was the case of the appellant
that the respondent-tenant had failed and neglected to pay rent between
October, 1987 till March, 1988. In fact, the appellant had issued a
notice to the respondent-tenant on 20th January, 1988 calling upon him
to pay rent in respect of the suit premises. That notice was replied by the
respondent-tenant on 22nd February, 1988, raising a dispute of
ownership of the suit premises. The appellant then issued demand notice
to the respondent-tenant on 17th March, 1988 calling upon him to pay
the arrears of rent. No reply was received from the respondent-tenant.
As a result, an eviction application was filed by the appellant. The Rent
Controller held that the respondent-tenant had committed default and
was liable to be evicted. Accordingly, an eviction order was passed by the
Rent Controller on 11th April, 2005. Against that decision, the
respondent-tenant preferred a statutory appeal before the District Judge
at Latur being Rent Appeal No.5 of 2005. The District Court reversed the
finding of fact recorded by the Rent Controller. The Appellate Court
found that the respondent-tenant upon receipt of notice from the
appellant immediately approached the Rent Controller and deposited the
amount towards rent as prescribed by the Rent Controller. Further, the
appellant admitted in his evidence of having withdrawn the amount
deposited in Court by the respondent-tenant till Diwali 2003. On the
factum of willful default by the respondent-tenant, the Appellate Court
reversed the finding of the Rent Controller. As regards the factum of
denial of title by the respondent-tenant, the Appellate Court held that the
circumstances in which that plea was taken by the respondent-tenant
was bonafide - considering the fact that the appellant landlord himself
had admitted that the dispute regarding ownership of suit shop was the
subject matter of the RCS No.1033 of 1983 filed by him before the Civil
Court. Besides the appellant, one Vishwanath Tandale also claimed his
ownership over the suit shop. He had filed an affidavit in the
proceedings before the Rent Controller to which the appellant was a
party. The District Court, accordingly, allowed the appeal preferred by
the respondent-tenant and reversed the order passed by the Rent
Controller. Consequently, the eviction application filed by the appellant
was dismissed.
5. Against this decision, the appellant preferred a revision application
before the High Court. The High Court after considering the relevant
material on record held that the finding of fact recorded by the District
Court was flawless on both counts, namely, the factum of tenant not
being a willful defaulter and also on the issue of justness of his plea to
question the ownership in respect of the suit shop. The High Court,
accordingly, affirmed the view taken by the District Court and dismissed
the revision application. Against this decision, present appeal has been
filed by the landlord.
6. According to the appellant, in the fact situation of the present case,
the decree of eviction passed by the Rent Controller should be restored.
Inasmuch as, admittedly, the tenant failed to give reply to the demand
notice served on him nor offered the outstanding rent within the
statutory period. Thus, Section 15 (2) (i) was attracted. Further, the
tenant failed to regularly pay the amount towards rent during the
pendency of eviction proceedings. As a matter of fact, contends the
counsel for the appellant, the tenant having denied the title of the
appellant was not entitled to occupy the suit shop. Further, the original
eviction application was filed by the appellant as back as in the year
1988 and by passage of time the appellant has already become 84 years
of age. He has three sons who are yet to settle down. It is contended that
the appellant requires the suit shop for his personal and bonafide need
for which reason also order of eviction passed by the Rent Controller
should be restored. The respondent-tenant, on the other hand, contends
that the latter contention raised by the appellant cannot be taken note
of. In that, the present appeal arises from the eviction proceedings
instituted by the appellant limited to the ground of arrears of rent and
willful default committed by the tenant. The ground on which eviction of
the respondent-tenant was prayed has been thoroughly examined by the
District Court and the finding of fact recorded by the District Court has
found favour with the High Court, which needs no interference in the
present appeal. The learned counsel for the respondent submitted that
the plea of personal and bonafide requirement is untenable. As per her
instructions, two sons of the appellant have since expired. The third son
is gainfully employed and doing business in another commercial
premises in possession of the appellant. Moreover, the appellant has
sufficient accommodation in his possession. It is submitted that the
appeal is devoid of merit and be dismissed.
7. Having considered the rival submissions, we are in agreement with
the view taken by the High Court that the evidence on record leaves no
manner of doubt that after receipt of notice from the appellant, the
respondent-tenant immediately rushed to the Rent Controller and took
permission to deposit the amount towards rent of the suit shop. Further,
in terms of the liberty given by the Rent Controller the respondent-tenant
deposited the amount towards rent of the suit shop before the Rent
Controller. That option was resorted to by the respondent-tenant because
of dispute relating to ownership of the suit shop. The High Court justly
adverted to the dictum in the case of Kannan vs. Tamil Tahlir Kalvi
Kazhagam (1998) 5 SCC 21
 - where, in similar situation, the tenant deposited the rent in
Court which was considered as a valid deposit. The fact remains that the

amount towards arrears of rent was deposited by the respondent-tenant
in the Court of Rent Controller on 15th April, 1988 and 25th April, 1988
before institution of the eviction application; and intimation in that
behalf was given to the landlord. The respondent-tenant continued to
periodically deposit the rent amount in Court thereafter. Further, the
appellant in his evidence has admitted of having withdrawn the rent
amount till Diwali 2003. This finding of fact recorded by the District
Court and affirmed by the High Court, being concurrent finding of fact,
need no interference. As a necessary corollary, it must follow that the
respondent-tenant was not a defaulter muchless willful defaulter. Thus,
the ground of default on which eviction of the respondent-tenant was
prayed is untenable.
8. Even the other ground, about denial of title by the tenant, the
District Court has found that this plea was necessitated because of the
civil suit pending between the appellant and one Vishwanath Tandale,
filed by the appellant himself before the Civil Court bearing RCS No.1044
of 1983. That suit was pending at the relevant time. The fact that the
respondent-tenant rushed to the Rent Controller immediately after
receipt of notice from the appellant, is indicative of a bonafide plea taken
by the respondent-tenant regarding dispute of ownership of the suit
shop; and a plea legitimately available to the respondent-tenant. This
finding of the District Court found favour with the High Court. Even in
respect of this finding no interference is called for, being flawless.
9. That leaves us with the contention of the appellant, raised for the
first time, that the appellant requires the suit shop for his personal and
bonafide need. The factual position stated by the appellant in support of
this plea has been stoutly countered by the respondent-tenant. It is,
however, not necessary for us to burden this judgment with the said
issue. Firstly, because the original eviction application was limited to the
ground of arrears of rent and willful default. Secondly, the ground of
personal and bonafide requirement is an independent ground on which
the appellant must pursue his remedy before the Rent Controller in the
first instance and also succeed in substantiating the relevant material
facts in that behalf.
10. While parting, we may take notice of the stand taken by the
respondent-tenant that the appellant is not genuinely interested in using
the premises for his personal use; but more interested in getting higher
rent from the new tenant. The respondent-tenant, therefore, volunteers
through counsel that considering the fact that the suit shop is
commercial premises and in his occupation for quite some time, he
would be willing to pay some additional amount to the landlord towards
monthly rent of the suit shop. As per the agreement, the rate of rent is
Rs.400/- per month, which, the respondent is now willing to increase up
to Rs.10,000/- per month. We place this offer given by the respondent on
record and would dispose off the appeal on that basis.
11. Accordingly, even though we dismiss the appeal, we direct the
respondents to pay a monthly rent in respect of the suit shop to the
landlord at the rate of Rs.10,000/- per month w.e.f. 1st January, 2016.
The additional rent amount for the period between 1st January, 2016 till
31st July 2016 be paid to the landlord within one month from the date of
this order; and the respondents shall then continue to pay future rent at
the rate of Rs.10,000/- per month before the fifth day of every English
calendar month. Appeal is disposed of in the above terms. No order as to
costs.
.………………………….CJI
(T.S.Thakur)
..……………………………J.
(A.M. Khanwilkar)
……………………………..J.
(Dr. D.Y. Chandrachud)
New Delhi,
August 16, 2016
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