1. The question which arises for decision in this Revision Application is whether a finding recorded by Rent Controller in proceedings under C. P. & Berar Letting of Houses Rent Control Order, 1949 (hereinafter referred to as the Order), to the effect that the tenant is not in arrears of rent operates as res judicata in a civil suit subsequently filed by the landlord against the tenant for recovering rent for the same period. This question arises in the following circumstances.
2. The non-applicant owns a room which is the subject matter of this litigation. He had let it out to the applicant at the monthly rental of Rs. 10/-. In 1970 the non-applicant made an application to the Rent Controller under the provisions of Clause 13 (3) (i) and (ii) of the Order for permission to serve a notice on the applicant determining his lease on the ground that the applicant was in arrears of rent for an aggregate period of three months and that he washabitually in arrears of rent It appears in this application non-applicant alleged that the applicant had paid the rent till end of August 1967 and in September 1967 non-applicant took a loan of Rs. 100/- from the applicant and it was agreed that the interest on this loan should be Rs. 30/- and that the amount of principal and interest should be appropriated towards the rent for 13 months and thus according to non-applicant he received the rent up to the end of September 1968. Non-applicant, therefore, contended in the said application that the applicant had failed to pay rent from Oct. 1968 till February 1970 and thus he was in arrears of rent for more than three months and he was also a habitual defaulter.
3. On the other hand, the applicant contended before the Rent Controller that in fact non-applicant had taken a loan of Rs. 500/- from him and it was agreed that this amount would not carry any interest and the applicant would not pay any rent of the room till the non-applicant repaid the said amount of Rs. 500/. The applicant alleged that non-applicant had not repaid the said loan of Rs. 500/- and hence, he was not entitled to recover the rent under the above said agreement. Thus the applicant submitted before the Rent Controller that he did not owe anything to non-applicant by way of rent for the period, for which the said proceedings had been started. The Rent Controller after considering the evidence adduced by the parties found that the agreement set up by the applicant had been established and consequently, he held that the applicant could not be said to be in arrears for more than three months and was also not habitual defaulter, as alleged by non-applicant. The non-applicant preferred an appeal before the Resident Deputy Collector under the provisions of the said Order. However, the latter confirmed the findings and order passed by the Rent Controller in favour of the applicant and dismissed the appeal. The Rent Controller passed his order on 20-5-1970 and the Resident Deputy Collector passed his order on 8-1-1971.
4. Thereafter on 3-11-1971 non-applicant filed a suit in the Court of Civil Judge, Junior Division at Pusad against the applicant for recovering the rent of Rs. 360/- for the period from October 1968 to October 1971. In the plaint non-applicant reiterated the same averments which he had made before the Rent Controller. In short, he said that he had received the rent upto the end of September, 1967. He had taken the loan from the applicant in September, 1967 and had agreed to pay interest of Rupees 30/- thereon and this amount of principal and interest was appropriated towards the rent for 13 months, It appears that in the plaint non-applicant had referred to the plea taken by the applicant before the Rent Controller with regard to the alleged loan of Rs. 500/- and non-payment of rent on his part till non-applicant returned this amount. Non-applicant maintained in the plaint that the transaction which was sought to be set up by the applicant before the Rent Controller was in the nature of usufructuary mortgage which required to be proved only by registered document and no oral evidence could be admissible on that count. Probably what the non-applicant wanted to suggest was that though the plea of the applicant had been upheld by the Rent Controller and by the Appellate Authority, it was not a plea of loan, because of the nature of transaction,
5. The applicant resisted the suit by filing a detailed written statement and inter alia contended that the Rent Controller had already found that he was not in arrears of rent from October 1968 to February 1970 and hence, this finding operated as res judicata. He submitted that non-applicant sought to get rid of the order passed by the Rent Controller and the Civil Court had no jurisdiction to do so. It appears that he also gave the details of the loan of Rs. 500/-, which he is alleged to have given to non-applicant and also set up the same agreement, which he had set up before the Rent Controller.
6. Amongst the issues framed by the trial Court, there was an issue to the effect, whether the said finding of the Rent Controller operated as res judicata. There was also an issue as to whether non-applicant proved that the applicant had failed to pay monthly rent from October 1968 to October 1971, The learned trial Judge rejected the contention of non-applicant to the effect that the plea set up by the applicant before the Rent Controller and before the trial Court also, amounted to setting up a usufructuary mortgage and no oral evidence could be admissible on that count. The learned trial Judge allowed oralevidence to be adduced and the parties did adduce such evidence before him. On this evidence, the learned trial Judge upheld the contention of the applicant that the non-applicant had borrowed some amount from the applicant and that so long as this debt was not repaid, the interest was to be appropriated towards rent. In this view of the matter the learned trial Judge held that the non-applicant had failed to prove that the applicant had failed to pay rent for the above said period. In the view, which he took on evidence the learned trial Judge did not think it necessary to record any finding on the issue with regard to res judicata. Consequently, the learned trial Judge dismissed the suit with costs.
7. The non-applicant then preferred an appeal before the District Judge. It was contended on behalf of the applicant before the District Judge that the finding of the Rent Controller regarding the existence of agreement set up by the applicant operated as res judicata. The learned District Judge negatived this contention and proceeded to examine the evidence on record to test the veracity of the plea set up by the applicant with regard to the loan and the agreement for payment of rent. On examination of the evidence, the learned District Judge held against the applicant and rejected his contention to this effect. He, therefore, held that the applicant was in arrears of rent for the period from October 1968 to October 1971. In this view of the matter, he passed a decree for Rs. 360/- with costs of suit in favour of the non-applicant. It is against this decree in appeal that the present revision Application has been filed.
8. Mr. A.M. Bapat, learned counsel for the applicant, submitted that the applicant had to invoke revisions powers of this Court as a second appeal was barred under Section 102 of Code of Civil Procedure (hereinafter referred to as the Code), as the suit in question was of the nature cognizable by a Court of Small Causes though it was not tried as such probably because the learned Trial Judge did not have necessary pecuniary jurisdiction to entertain the suit.
9. Mr. Bapat assailed the finding of the Appellate Court on the question of res judicata. He submitted that the learned Appellate Judge had merelydecided this issue relying on Section 7 of Central Provinces and Berar Regulation of Accommodation Act, 1946 and clause 21 of the said Order and had not considered the application of the general principles of res judicata to the proceedings before Rent Controller. Relying on the decision of Supreme Court in Gulabchand v. State of Gujarat : 2SCR547 Mr. Bapat submitted that Section 11 of the Code of Civil Procedure is not exhaustive of the law with regard to res judicata and on the general principle of res judicata any previous decision on a matter in controversy decided by a competent authority after full contest, will operate as res judicata in, a subsequent regular suit. Mr. Bapat relying on the decision of Full Bench of erstwhile Nagpur High Court in Bhailal v. Addl. Deputy Commissioner 1952 Nag LJ 613 submitted that the Rent Controller and the Deputy Collector acting under the said Order exercised judicial function and the Rent Controller is a legal tribunal and not merely an Executive Officer. According to Mr. Bapat, if this is so the ratio of the decision of Supreme Court in Gulabchand's case would be applicable to the findings of the Rent Controller and Deputy Collector with equal force. Thus according to Mr. Bapat, the learned District Judge was in error in holding that the finding of the Rent Controller and the Deputy Collector in the proceedings under the said Order upholding the plea of the applicant with regard to the agreement did not operate as res judicata. Mr. Bapat submitted that since the question of res judicata fixed the jurisdiction of the Court to decide an issue, this Court could interfere with this finding of the Appellate Court in Revision.
10. From what I have said above, it would be abundantly clear that in the proceedings before the Rent Controller, the applicant had specifically pleaded that he had advanced a loan of Rupees 500/- to non-applicant and that, it was agreed that till the latter repaid the loan, he (the applicant) was not to pay the rent and that since non-applicant had not repaid the loan till the proceedings were taken up before the Rent Controller, the question of payment of rent to non-applicant did not arise. It is also clear that this plea of the applicant not only found favour with the Rent Controller, but also found favour withthe Resident Deputy Collector in appeal as the latter confirmed the finding and order passed by the Rent Controller. It would thus appear that the order of the Rent Controller has merged in the order passed by the Resident Deputy Collector in appeal. The result, therefore, is that there is a final decision in the proceedings in the said Order to the effect that the applicant had advanced a loan of Rs. 500/- to non-applicant and that he was absolved from paying rent to the latter till the said loan was repaid and since it was not repaid, he was not in arrears of rent.
11. As already seen above, the non-applicant filed the suit for arrears of rent, which partly covers the same period for which the non-applicant alleged before the Rent Controller that the applicant had failed to pay the rent and was in arrears. The same contention was raised by the applicant and hence, the question was whether this contention can be gone into by the Civil Court in a suit in the face of the finding, which had already been given by the authorities under the said Order after full contest.
12. As already seen above, the trial Court did not go into the question of res judicata as it itself went through evidence and held the agreement to have been proved by the applicant and it thought that the question regarding res judicata was not necessary to be decided. As a matter of fact the trial Court should have first decided the question regarding res judicata and then should have considered the evidence if it held that the finding of the authorities under the said Order did not operate as res judicata. In this respect the approach of the Appellate Court was quite correct. It first decided the question of res judicata and after having negatived it, proceeded to consider the evidence to see if the applicant had proved the agreement set up by him. Now the learned Appellate Judge was of the view that neither Section 7 of the Act nor Sub-clause (3) of Clause 21 of the Order prevented the Civil Court from deciding a matter on which a finding had been recorded by the authorities under the said Order. He is right so far as Section 7 is concerned because it provides that no Civil Court, tribunal or revenue officer other than an officer or authority empowered under an ordermade or deemed to be made under Section 2 shall have any jurisdiction by way of appeal or revision in respect of any order passed by any authority empowered in that behalf by any such order in respect of any matter specified in Section 2. It would appear that this section only debars the Civil Court, tribunal or revenue Officer from exercising any jurisdiction by way of appeal or revision in respect of an order passed by an authority under the said order or in respect of matters specified in Section 2. Construed strictly, this section would not debar the Civil Court from deciding a matter which had already been decided by the said authority. Now clause 21 (3) of the Order provides that the decision of the Deputy Commissioner and subject to only such decision an order of the Controller shall be final and no further appeal or revision or application for review shall lie from such decision to any authority whatsoever. It would, therefore, appear that this Sub-clause enjoins finality on the decision of the Appellate Authority under the order and subject to it, on the order of the Controller. Now the learned Appellate Judge has held that finality is accorded to the decision and not to the finding. In other words, the learned Appellate Judge appears to make distinction between a decision and a finding. According to the learned Appellate Judge, what is final under the said Sub-clause is the ultimate decision of the Rent Controller or the Deputy Commissioner as the case may be, but not the finding or findings on which the decision is based. The learned Appellate Judge was of the view that what the Rent Controller was to decide was only the question whether applicant had committed default in payment of rent so as to enable him to grant permission under the Order and it was not, therefore, necessary for him to go beyond it and decide the question of existence or otherwise of the agreement set up by the applicant. It is in this view that he held that the finding of the Rent Controller and the Deputy Collector would not operate as res judicata on the question of existence of the said agreement. It would, therefore, appear that the learned appellate Judge has merely proceeded to consider the provisions of Section 7 and Sub-clause (3) of clause 21 of the Order, but has not considered the applicability of thegeneral principles of res judicata to such proceedings.
13. In Gulabchand v. State of Gujarat : 2SCR547 two points came up for consideration before the Supreme Court. The first was whether Section 11 of the Code is exhaustive with respect to the application of the principles of res judicata in a suit and the second point was whether in a subsequent suit the general principles of res judicata can bar the consideration of matters directly in issue and identical with those, which had been earlier and after full contest decided on merits by a competent Court in any other proceeding including the proceeding in writ petition. These points arose in the context of the fact that the questions which had been decided earlier in a writ petition were sought to be agitated again in a suit subsequently filed. A Bench consisting of five Judges heard this matter. Subba Rao J. recorded a dissenting judgment and Raghubar Dayal J. delivered the majority judgment for himself and other three learned Judges. His Lordship considered the historical background of the application of the principles of res judicata as contained in Section 11 of the Code and also the various decisions of the Privy Council and the Supreme Court having a bearing on the points under consideration and summarised his conclusions in the following words.
'As a result of the above discussion, we are of opinion that the provisions of Section 11 C. P. C. are not exhaustive with respect to an earlier decision operating as res judicata between the same parties on the same matter in controversy in a subsequent regular suit and that on the general principle of res judicata any previous decision on a matter in controversy decided after full contest or after affording fair opportunity to the parties to prove their case by a Court competent to decide it, will operate as res judicata in a subsequent regular suit. It is not necessary that the Court deciding the matter formerly be competent to decide the subsequent suit or that the former proceeding and the subsequent suit have the same subject matter. The nature of the former proceeding is immaterial.' It would thus appear that according to the Supreme Court, the general principle of res judicata is applicable even though former proceeding is not a suit.
According to these observations, if the decision is recorded in a former proceeding on a matter in controversy after full contest or after affording fair opportunity to the parties to prove their respective cases by a court competent to decide it, it will bar the decision of the said controversy in subsequent suit on the general principle of res judicata though not strictly under the provisions of Section 11 of the Code of Civil Procedure. It is to be noted that according to this decision, it is not necessary that the Court deciding the matter formerly should be competent to decide the subsequent suit or that the former proceeding and the subsequent suit must have the same subject matter. The nature of the former proceeding is immaterial.
14. It is true that in the passage quoted above, the Supreme Court has referred to the previous decision being a Court (sic). However in my opinion the principle laid down there would apply with equal force to decisions of tribunals or authorities discharging judicial function, as the distinction between Courts on one hand and such tribunals or authorities on the other hand, though slight, would not make any difference to the application of the said principle. The question as to the nature of the functions performed by the Rent Controller and the Deputy Commissioner under the Order came up for decision before a Full Bench of the erstwhile Nagpur High Court in Bhailal v. Addl. Deputy Commissioner 1952 Nag LJ 613. After considering various decisions bearing on the point, the Full Bench recorded its opinion as follows:
'Applying these tests to the Rent Controller and the Deputy Commissioner acting under the Order, the inference is irresistible that they exercise judicial functions and the Rent Controller is a legal tribunal and not merely an executive officer. An examination of their powers and duties clearly establishes this.'
It would, therefore, appear that the Rent Controller and the Deputy Commissioner perform judicial functions and are as such judicial tribunals. It may be mentioned here that this decision refers to the Deputy Commissioner as these words occurred in clause 21 as originally enacted. But these words are now substituted by the word 'Collector' and the powers of the Collector can be delegated to the Deputy Collector underclause 21-A by the State Government. Thus though the decision of Full Bench refers to the Deputy Commissioner, it would apply also to a Deputy Collector exercising the powers under clause 21 of the Order. Reference may be had to some decisions in which the general principle of res judicata has been made applicable to proceedings, apart from the suits by or before authorities constituted under various Acts. In Madanlal v. Competent Authority , the general principle of res judicata was applied to the decision of the authorities under the Delhi Rent Control Act and it was held that the same contention could not be agitated by the parties in subsequent proceedings under the Slum Areas Act. A similar view has been taken by that Court in Yoginder Pal v. Competent Authority . In Sat Pal v. Sudarshan Lal : AIR1972Delhi295 the general principle of res judicata was held to be applicable to quasi-judicial decisions of tribunals other than Civil Courts. Of course this was on the authority of earlier two decisions of that court cited above. In Man Singh v. Bir Sahai : AIR1973All435 a Division Bench of that Court held that the decision in previous suit on the question of tenancy itself would operate as res judicata in a proceeding before the Revenue authorities.
15. In Allahabad Bank v. R. S. A. Singh : AIR1976All447 a Division Bench of that Court held that the general rule of res judicata can be invoked in the proceedings under U. P. Zamindari Debt Reduction Act.
16. It would appear from what has been said above that the general principle of res judicata is applicable to a finding of a authority or tribunal exercising judicial function and if the same controversy on which finding is given, is raised in a subsequent suit, the decision of that controversy in that suit would be barred on the general principle of res judicata. However, as can be seen from the passage quoted from the decision of the Supreme Court above, this is subject to certain conditions, namely, that the previous decision was between the same parties and on the same matter in controversy and that the matter in controversy in the earlier proceeding must have been decided after full contest or after affording full opportunities to the parties to prove their cases and that such a decision shouldbe by an authority competent to decide it. In this background let us see, if the finding of the Rent Controller as confirmed by the Deputy Collector with regard to the agreement set up by the applicant would operate as res judicata in the suit filed by the non-applicant against the applicant for arrears of rent.
17. There is no dispute that the proceedings before the Rent Controller and the Deputy Collector were between the same parties, namely, the applicant and the non-applicant. It also cannot be disputed that the controversy between the parties in the proceedings before the Rent Controller and the Civil Court with regard to the agreement is identical because in both the proceedings the applicant contended that he was not in arrears of rent because of the loan he had advanced and the agreement between him and non-applicant with regard to non-payment of rent till the loan was due. It cannot be gainsaid that in order to arrive at a conclusion whether permission should be given to the non-applicant to determine the lease of the applicant, it was necessary for the Rent Controller to find out, if the applicant had committed default in payment of rent for more than three months and if he was a habitual defaulter. Now for recording a finding on this point, it was necessary for the Rent Controller to consider the contention of the applicant that no rent was due from him because of the alleged agreement. Thus the Rent Controller was competent to decide and determine whether there existed any agreement as pleaded by the applicant. Now it is amply clear from record that the matter had been fully contested by the applicant and non-applicant before the Rent Controller as both of them had adduced evidence in support of their respective contentions. It is, therefore, clear that all the conditions which have been laid down by the Supreme Court in the aforesaid decision for application of the general principle of res judicata have been satisfied in this case and if that is so, there should not be any difficulty in holding that the finding of the Rent Controller as confirmed by the Deputy Collector to the effect that there had been an agreement between the applicant and non-applicant, by which the applicant was absolved from payment till the loan was repaid, would operate as res judicata and bar the considera-tion of this question by the Civil Court in the subsequent suit.
18. It is true that the dispute between the applicant and non-applicant before the Rent Controller was with regard to the period from October 1968 to October 1971. It would thus appear that the period from March 1970 to October 1971 is not covered by the finding of the Rent Controller. However what was to be seen by the Civil Court was whether there was such an agreement as pleaded by the applicant and on this point the finding of the Rent Controller would operate as res judicata. Consequently, the Civil Court will have to hold in favour of the applicant that there was such an agreement. In fact the trial Court did hold so, though not on the principle of res judicata, but after examining the evidence. The Appellate Court has reversed the finding because in its view the finding of the Rent Controller did not operate as res-judicata. Now if once it is held that there was an agreement as pleaded by the applicant, the non-applicant would not be able to establish that the rent for the aforesaid period is due, unless he establishes that he had repaid the loan of Rs. 500/- to the applicant and the latter had therefrom become liable to pay the rent. Now there is no evidence, much less pleading to this effect and hence, if the said agreement is held to be operative, unless it is proved otherwise, it has to be held that the applicant did not owe any rent to the non-applicant during the existence of such an agreement. In this view of the matter, therefore, the learned Appellate Judge, was not right in holding that the applicant owed an amount of Rupees 360/- as rent for the abovesaid period. In the view, which I take this finding of the learned Appellate Judge cannot be sustained and will have to be set aside. Consequently, the decree passed by him will have to be reversed and that of the trial Court will have to be restored.
19. The revision application is therefore, allowed. The rule is made absolute and the decree passed by the Appellate Court is hereby set aside and the decree passed by the trial Court is hereby restored. Non-applicant shall pay costs of the applicant of the appeal as well as this Revision Application and bear his own.
20. Revision allowed.