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Rajpati Sudama Panday Vs. Taj Mohamed Rustom Khan - Court Judgment

LegalCrystal Citation
SubjectTenancy
CourtMumbai High Court
Decided On
Case NumberCivil Revision Application No. 1729 of 1962
Judge
Reported in(1964)66BOMLR258; 1964MhLJ390
AppellantRajpati Sudama Panday
RespondentTaj Mohamed Rustom Khan
Excerpt:
.....filed by landlord in eviction after notice under section 12 calling upon tenant to pay arrears of rent and permitted increases--whether previous notice making an increase in rent under section 10 necessary.;section 10 of the bombay rents, hotel and lodging house rates control act, 1947, entitles the landlord to make an increase in the rent--and this may be contractual and may be more or less than the standard rent or even equal to it. if it is more and a contention that the rent is excessive is raised by the defendant the court must determine the same and also allow the permitted increases in addition to the standard rent determined by it. if the landlord claims the permitted increases in the suit without a prior demand, the court would not be justified in rejecting the claim except..........is given under section 12 by a landlord for termination of tenancy on the ground of arrears of rent and permitted increases, under section 10, the landlord must terminate the agreement regarding the contractual rent and demand the increases and it is only thereafter that he can issue a notice under section 12. as there was no prior notice in the present case, they held that the claim was excessive. they also observed that the increase in municipal taxes was on. the rateable value while the landlords had claimed the increases on the full amount of rent. they, therefore, held that the notice was bad in law. they allowed the appeal and dismissed the suit of the plaintiffs. it is this judgment that is sought to be revised in the present petition.2. in our view, mr. advani is right in his.....
Judgment:

Patel, J.

1. His Lordship after stating the facts, proceeded. The learned Judges then addressed themselves to the question as to whether the notice was valid. They construed Sections 10 and 12 of the Kent Act to mean, relying on a judgment of their own Court that before a notice is given under Section 12 by a landlord for termination of tenancy on the ground of arrears of rent and permitted increases, under Section 10, the landlord must terminate the agreement regarding the contractual rent and demand the increases and it is only thereafter that he can issue a notice under Section 12. As there was no prior notice in the present case, they held that the claim was excessive. They also observed that the increase in municipal taxes was on. the rateable value while the landlords had claimed the increases on the full amount of rent. They, therefore, held that the notice was bad in law. They allowed the appeal and dismissed the suit of the plaintiffs. It is this judgment that is sought to be revised in the present petition.

2. In our view, Mr. Advani is right in his contention that the learned Judges were not justified in holding that the notice was bad on the ground that the percentage of increase in the municipal taxes was on the rateable value while the landlords had asked the amount of increase on the full rent. He contends-and rightly-that no such question was raised in the defences and there is not one word suggested either in the defences of the defendant or in his evidence from which an inference can be drawn that the rateable value for which the premises were charged was any different from the standard rent which was recovered for the premises. Very often the rateable value differs from the rent chargeable under the Rent Act and is often higher. Unless proper evidence is led to enable the Court to hold in favour of the defendant, it was an error on two part of the appellate Court to raise such a point merely on the arguments at the bar. It is pertinent to note that Section 10 permits the transfer of the increase to the tenant and unless it is shown that the burden sought to be transferred to the tenant is in excess of the amount paid by the landlord it cannot be held that the demand was excessive and for which there is no proof.

3. The only question then remains is whether the appellate Court was right in the interpretation of Sections 10 and 12. Summary of its views will be found in this sentence:

In the case before us, the respondents sought to recover the increase above the contractual rent without first putting an end to the contract as to rent and so the demand in respect of the increased rent would clearly be illegal.

Section 10 is worded in simple language and it must be interpreted in a reasonable, manner without any addition into the section. Section 10, so far as is relevant, says:

Where a landlord is required to pay to a local authority.any rate, cess or tax.he shall be entitled to make an increase in the rent of the premises by an amount not exceeding the increase paid by him..

The emphasis is laid on the words 'he shall be entitled to make an increase' and it is said that unless he makes an increase lie would not be entitled to recover the amount. If one reads the notice, the only conclusion to which one can come is that the landlord exercised the choice which lay with him to make the increase when he asked the tenant to pay the increased, taxes. There is nothing in law to prevent the landlord making the increase at the time of giving notice. The law itself gives the tenant a month's time to pay the amount and it is only if the amount is not paid during the whole month, that the landlord is entitled to file a suit. There is nothing in the statute which requires a landlord to give first a notice under Section 10 and then a further notice under Section 12. We fail to see why the demand of the landlord for the increase in the rent does not amount to making of an increase in the rent.

4. Some attempt was made to rely on the words in Section 10B of the Act which relates to the recovery by the landlord of the amount of the riot tax from his tenant when imposed. The reason for the difference in the language is not far to seek. In the one case there is a continuing increased payment every month as and when it becomes due for the whole period during which the taxes have been increased, while in the other it relates to the recovery of a single sum of money on a single occasion when imposed. It is for this reason that the Legislature has used the words 'shall be entitled to recover' and more so because it has further provided the recovery by instalments. Merely because there is difference in the language in these two sections, we cannot import into Sections 10 and 12 something which is not there.

5. We might also point out that the learned Judges have not clearly appreciated, the judgment of their own Court on which they have relied. That case arose out of a suit by the landlord for recovery of certain sums of money as increase in rent being proportionate share of water charges alleged to be due from the tenants. The tenants had paid from time to time the actual rents due without any increase having been demanded by the landlord. A perusal of the judgment shows that at no time intimation was given to the tenants requiring them to pay the increased charges. It is true that the landlord could increase the rent but he was not bound to recover the charges payable by the tenant. Even so it appears to us that the conclusion of the learned Judges could not be justified. If a party files a suit without giving notice, it is only a matter of costs and the plaintiff is entitled to a decree provided law permits it. The learned Judges in that case observed:

The legislature has only put certain restrictions and controls on these contracts and the Court cannot in law refuse to enforce a contract as; to rent if the rent did not exceed the standard rent and the permitted increases. In fact, in such a case, it will be the contractual rent only and not the standard rent which will be enforced by the Court, so long as the contract is in force. Similarly in the case of permitted increases also, a landlord will not be entitled to enforce any increase in cases where his contractual rent is less than or equivalent to the standard rent until the contract as to the rent is terminated. Merely because a landlord possesses a right to increase the rent to the extent permitted by the law, it does not follow that he can recover it without first making such an increase.

It is difficult to see why permitted increases cannot be recovered if the contractual rent is less than or equal to the standard rent. Section 10 entitles the landlord to make an increase in the rent-and this may be contractual and may be more or less than, the standard or even equal to it. If it is more and a contention that the rent is excessive is raised by the defendant the Court must determine the same and also allow the permitted increases in addition to the standard rent determined by it. If the landlord claims the permitted increases in the suit without a prior demand, the Court would not be justified in rejecting the claim except when the tenant can resist the claim on the ground of estoppel in which case he has to prove prejudice. If no such ground is alleged the Court must decree the permitted increases in addition to the rent whether contractual or otherwise and whether equal to or less than the standard rent, the suit itself being treated as a demand. It may be that the Court may disallow costs to the plaintiff.

6. In the present case in fact a demand was made for the increased payment which the tenant was bound in law to pay, and if he failed to do so within the time provided by Section 12 of the Act, a decree must follow under Section 12(5)(a) of the Act.

7. Mr. Banaji cited before us the decision in Penfold v. Newman [1922] 1 K.B. 645 which, in our view, has absolutely no application at all.

[The rest of the judgment is not material to this report.]


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