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Jaypal Bandu Adake and anr. Vs. Basavali Gurulingappa Mhalank and anr. - Court Judgment

LegalCrystal Citation
SubjectTenancy;Civil
CourtMumbai High Court
Decided On
Case NumberSpecial Civil Application Nos. 1812 and 1866 of 1977
Judge
Reported in(1982)84BOMLR485; 1982MhLJ512
ActsBombay Rents, Hotel and Lodging House Rates Control Act, 1947 - Sections 11(3), 12(1), 12(2) and 12(3)
AppellantJaypal Bandu Adake and anr.;kesharlal Shamlal Jain
RespondentBasavali Gurulingappa Mhalank and anr.;bansilal Loknath JaIn and anr.
Appellant AdvocateAjit P. Shah and ;M.D. Gangakhedkar, Advs. in Special Civil Application No. 1812 of 1977, ; S.M. Dange, Adv. for ;M.V. Sali, Adv. in Special Civil Application No. 1866 of 1977
Respondent AdvocateB.P. Apte, Adv. for respondent No. 1 in Special Civil Application No. 1812 of 1977, ;V.P. Tipnis, Adv. for respondent No. 1 in Special Civil Application No. 1866 of 1977
Excerpt:
bombay rents, hotel and lodging house rates control act (bom. lv1i of 1947), sections 12(1), 12(3)(a), 12(3)(b), 11(3), 11(4)- replying to notice of demand under section 12(2) by disputing standard rent whether other permissible mode for taking case out of clutches of section 12(3)(a) - application for fixation of standard rent by tenant already pending before notice of demand under section 12(2) - whether obligatory on tenant to make further application under - section 11(3) read with expl. 1 to section 12 - whether substantial compliance with conditions of section 12(3)(b) sufficient - court whether has power to extend time earlier specified by its order to deposit interim rent in court - civil procedure code (v of 1908), section 148 - limitation act (xxxvi of 1963), section 5.;if a.....m.n. chandurkar, j.1. these two petitions have been referred to the division bench on an order of reference made by a learned single judge, who experienced some difficulty in following decision of jahagirdar, j., in gulabchand v. noorbeg, : air1980bom307 . the questions referred relate to the construction of the provision of section 12(3)(a) of the bombay rents, hotel and lodging house rate control act, 1947 (hereinafter referred to as the 'rent act') and the determination of the correct ratio of two decisions of the supreme court in shah dhansukhlal chhaganlal v. dalichand virchand shroff, : [1968]3scr346 , and harbanslal jagmohandas and another v. prabhudas shivlal, : [1976]3scr628 . since the only points on which the decisions of both the petitions will really turn related to the.....
Judgment:

M.N. Chandurkar, J.

1. These two petitions have been referred to the Division Bench on an order of reference made by a learned Single Judge, who experienced some difficulty in following decision of Jahagirdar, J., in Gulabchand v. Noorbeg, : AIR1980Bom307 . The questions referred relate to the construction of the provision of section 12(3)(a) of the Bombay Rents, Hotel and Lodging House Rate Control Act, 1947 (hereinafter referred to as the 'Rent Act') and the determination of the correct ratio of two decisions of the Supreme Court in Shah Dhansukhlal Chhaganlal v. Dalichand Virchand Shroff, : [1968]3SCR346 , and Harbanslal Jagmohandas and another v. Prabhudas Shivlal, : [1976]3SCR628 . Since the only points on which the decisions of both the petitions will really turn related to the construction of the provisions of sections 12(3)(a) and 12(3)(b) of the Rent Act, we have heard the learned Counsel for the petitioners and the respondents in these cases not only on the questions of law referred but also on the merits of the two petitions and this judgment will, therefore, dispose of both the petitions.

2. The three questions of law which have been referred by the learned Single Judge in his order of reference are as follows :---

(1) Whether in order to take the case out of the provisions of section 12(3)(a), it is obligatory on the tenant to make an application for fixation of standard rent under section 11(3) of the Bombay Rent Act as required by the 1st Explanation to section 12 ?

(2) Whether the raising of the standard rent dispute by the tenant by reply to the demand notice before expiry of one without making an application under section 12 and the Explanation, or existence of such a dispute prior to the demand notice without the tenant making an application under section 11(3) would take the case of the tenant out of the provisions of section 12(3)(a) ?

(3) Whether it is obligatory for the tenant to make an application under section 11(3) before the expiration of the period of one month from the date of service of demand notice even when his application under section 11(3) is pending on the date of demand notice ?

3. We shall briefly refer to the facts in the two petitions before us. Special Civil Application No. 1812 of 1977 is filed by the landlords and it arises out of a suit filed by them claiming possession of the suit premises which consist of house property which was occupied by the tenant-respondent on a monthly rent of Rs. 55/- in Ward B of Kolhapur. The notice terminating the tenancy on the ground of arrears of rent was issued by the landlords on 29th January, 1973 and the arrears claimed were for the period 1st August, 1970 to 31st December, 1972. The tenant by a notice dated 15th February, 1973 disputed that Rs. 50/- was standard rent and claimed that the standard rent was Rs. 45/-. The suit for possession was filed on 4th September, 1973. The trial Court held that the standard rent of the premises was Rs. 50/- per month and that the tenant was entitled to the benefit of section 12(3)(b) of the Rent Act. Giving credit for the amount of Rs. 252.56, which was paid by the defendant by way of municipal taxes, the trial Court passed a money decree for Rs. 1547.44 but dismissed the suit for possession.

4. In appeal filed by the landlord, the Appeal Court relying on a Full Bench decision of the Gujarat High Court in Ramniklal Dwarkadas Modi v. Mohanlal Laxmichand and others, : AIR1977Guj15 , took the view that the tenant having raised a dispute with regard to standard rent in the reply to the notice under section 12(2) of the Rent Act within one month of the receipt of the notice, the tenant was not obliged to make a full payment immediately or file a separate application for fixation of standard rent under the provisions of section 11(3) of the Rent Act read with Explanation I to section 12 of the Rent Act. The Appeal Court further held that when the tenant gives a reply to the landlord's notice within one month disputing the standard rent, it becomes obligatory on the landlord to apply to the Court and get the standard rent fixed. The claim of the landlord under section 12(3)(a) was thus negatived, recording a finding that non-payment of arrears of rent did not amount to neglect since the evidence showed that the tenant was always ready and willing to pay the rent. It does not appear that the question as to whether the tenant was entitled to the protection of section 12(3)(b) of the Rent Act was agitated before the Appeal Court.

5. Special Civil Application No. 1866 of 1977 is filed by the tenant. The tenant is in occupation of a ground floor of the suit house as a monthly tenant at Rs. 4/-. Claiming that the tenant was in arrears of rent for 28 months, a notice terminating the tenancy of the tenant was issued on 5th January, 1968 by the landlord. The tenant replied to this notice on 21st January, 1968 disputing that Rs. 4/- per month was the standard rent. After the suit was filed on 11th January, 1971, a written statement came to be filed on 27th August, 1971 and an application for determination of standard rent also came to be filed by the tenant on the same day. The trial Court fixed the standard rent of the premises at Rs. 4/- per month and passed a conditional decree for possession if the tenant failed to pay rent of Rs. 176/- within one month from the date of the decree. The trial Court took the view that the tenant was not a wilful defaulter and that he was willing to pay the rent of the suit premises to the plaintiff. In appeal filed by the plaintiff, the District Judge, Jalgaon, took the view that though the tenant had raised a dispute about standard rent in the written statement or by an application filed on the same day, he had not preferred any application within the period of one month from the date of the notice and, therefore, in view of the decision in Harbanslal's case cited supra, it could not be said that there was a dispute about standard rent within the meaning of section 12(3)(a) of the Rent Act. He, therefore, held that the case would be covered under section 12(3)(a) of the Rent Act and the plaintiff would be entitled to a decree for possession. With regard to section 12(3)(b) of the Rent Act, the District Judge held that he had not complied with the provisions of section 12(3)(b) also inasmuch as he had not paid rent regularly as required and the defendant would, therefore, not be entitled to the benefit of section 12(3)(b).

6. When both these petitions were taken up for hearing by the learned Single Judge, it was argued on behalf of the landlords that in view of the decision in Dhansukhlal's case and Harbansal's case cited supra, the tenant can only be considered to be ready and willing to pay rent if before the expiry of the period of one month after the notice referred to in sub-section (2) of section 12 he makes an application to the Court under section 11(3) of the Rent Act and thereafter pays or tenders the amount of rent and permitted increases specified by the Court. Apart from the two decisions of the Supreme Court, a decision of a Division Bench of this Court in Special Civil Application No. 2810 of 1971, Champalal Pratapmal by his Vahiwatdar Mishrilal Chhogalal v. Municipal School Board (Primary School) Nandurbar, decided on 28th June, 1977 was also brought to the notice of the learned Judge. In that decision, the Division Bench after referring to the decision in Harbanslal's case observed as follows :---

'It is, therefore, now clear that where rent is payable by month and their are arrears of more than six months and the tenancy is terminated by valid notice, either the entire arrears of rent must be paid within one month or if a dispute regarding standard rent has to be raised, the tenant must apply within one month of the date of the receipt of the notice under section 11(3) and obtain appropriate direction from the Court. If he complies with those directions, he must be deemed to be a person who is ready and willing to pay. No third mode is now available for getting the protection of the Rent Act on the basis that the tenant is one who is ready and willing to pay'. (Underlining ours)

7. On behalf of the tenants the contention raise before the learned Single Judge was that if the dispute exists either on the date of the notice or if such dispute is raised within one month after the notice by a proper reply to the said notice, even without making an application under section 11(3) of the Rent Act, the tenant was entitled to protection under section 12(3)(b) of the Rent Act and the matter was taken out from the mischief of section 12(3)(b). This argument was advanced on the basis of the decision of Jahagirdar, J., in Gulabchand's case supra. The learned Single Judge could not persuade himself to agree with the view taken by Jahagirdar, J.

8. Mr. Shah appearing on behalf of the petitioner in Special Civil Application No. 1812 of 1977 and Mr. Tipnis appearing on behalf of the landlord in the other petition have contended that in view of the decision in Dhansukhlal's case and Harbanslal's case as well as Division Bench decision of this Court in Champalal Pratapmal v. Municipal School Board (Primary School) Nandurbar, decided on 28th June, 1977, it is no longer open to a tenant to contend that even if the tenant does not make an application under section 11(3) of the Rent Act, as required by Explanation I to section 12 he could still contend that there is a dispute with regard to standard rent because the tenant has raised the dispute in a reply to the notice served on him under section 12(2) and, therefore, his case does not fall within the provisions of section 12(3)(a) of the Rent Act.

9. On the other hand, Mr. Apte and Mr. Dange appearing on behalf of the tenants in the two petitions have wholly relied on the decision of Jahagirdar, J., in Gulabchand's case and, according to the learned Counsel, that decision takes the correct view that making an application under section 11(3) after the receipt of the notice under section 12(2) of the Rent Act is not the only mode of raising a dispute with regard to standard rent and that even if a dispute with regard to standard rent is raise in a reply to the notice given within one month from the date of the receipt of the notice under section 12(2), the Court must find that the tenant is ready and willing to pay rent and that in such a case, the provisions of section 12(3)(a) of the Rent Act will not be attracted. The learned Counsel have contended that the only ratio of Harbanslal's case is that a dispute with regard to standard rent cannot be raise beyond one month from the date of the receipt of the notice and the decision of the Supreme Court in Abbasbhai v. Gulamnabi, : [1964]5SCR157 , had specifically laid down that a dispute with regard to standard rent can be raised by giving a reply to the notice issued by the landlord under section 12(2) of the Rent Act within one month of the receipt of the notice and this view has been upheld by the Supreme Court in Dhansukhlal's case. In other words, the contention appears to be that in Harbanslal's case, the Supreme Court only decided that the dispute should be raised within one month and the Supreme Court was not concerned with the mode of raising a dispute and so far as the mode of raising a dispute was concerned, there was express authority in the decision in Abbasbhai's case that such a dispute could be raised by a reply to a notice under section 12(2).

10. Since the correctness of the view taken by Jahagirdar, J., in Gulabchand's case is challenged, it is necessary to refer in some detail to that judgment. Prior to that, it would be necessary to refer to the material provisions in section 12 and section 11(3) of the Rent Act which read as follows :

'12(1) A landlord shall not be entitled to the recovery of possession of any premises so long as the tenant pays, or is ready and willing to pay, the amount of the standard rent and permitted increases, if any, and observes and performs the other conditions of tenancy, in so far as they are consistent with the provisions of this Act.

(2) No suit for recovery of possession shall be instituted by a landlord against tenant on the ground of non-payment of the standard rent or permitted increases due, until the expiration of one month next after notice in writing of the demand of the standard rent or permitted increase has been served upon the tenant in the manner provided in section 106 of the Transfer of Property Act, 1882.

(3)(a) Where the rent in payable by the month and there is no dispute regarding the amount of standard rent or permitted increases, if such rent for increases are in arrears for a period of six months or more and the tenant neglects to make payment thereof until the expiration of the period of one month after notice referred to in sub-section (2) the Court shall pass a decree for eviction in any such suit for recovery of possession.

(b) In any other case decree for eviction shall be passed in any such suit if, on the first day of hearing of the suit or on or before such other date as the Court may fix, the tenant pays or tenders in Court the standard rent and permitted increases then due and thereafter continues to pay or tender in Court regularly such rent and permitted increases till the suit is finally decided and also pays costs of the suit as directed by the Court.

(4).........

Explanation I.---In any case where there is a dispute as to the amount of standard rent or permitted increases recoverable under this Act, the tenant shall be deemed to be ready and willing to pay such amount if, before the expiry of the period of one month after notice referred to in sub-section (2), he makes an application to the Court under sub-section (3) of the section 11 and thereafter pays or tenders the amount of rent or permitted increases specified in the order made by the Court.'

'11(3) If any application for fixing the standard rent or for determining the permitted increases is made by tenant who has received a notice from his landlord under sub-section (2) of section 12, the Court shall forthwith specify the amount of rent or permitted increases which are to be deposited in Court by the tenant, and make an order directing the tenant to deposit such amount in Court or at the option of the tenant make an order to pay to the landlord such amount thereof as the Court may specify, pending the final decision of the application. A copy of the order shall be served upon the landlord. Out of any amount deposited in Court, the may make an order for payment of such reasonable sum to the landlord toward payment of rent or increases due to the landlord towards payment of rent or increases due to him as it thinks fit. If the tenant fails to deposit such amount or, as the case may be, to pay such amount thereof to the landlords, his application shall be dismissed.'

11. In Gulabchand's case, the petitioner before this Court was the tenant who was in occupation of house premises at a rent of Rs. 500/- per annum. A suit was filed by the landlord for possession on the ground that the tenant had failed to pay arrears of rent which were for a period of more than six months within a month after the notice under section 12(2) of the Rent Act was served upon him. The other grounds on which possession was claimed are not relevant of our purpose. The tenant denied that there was any default on his part. The suit was decreed by the trial Court on the ground that the tenant was in arrears of rent and the landlord was held entitled to a decree for eviction in view of the provisions of section 12(3) of the Rent Act. This part of the decree was upheld in appeal. The tenant then filed a writ petition in this Court. The contention of the tenant was that there was a dispute with regard to standard rent even before the issue of the notice by the landlord and the case should have been dealt with as one falling under section 12(3)(b) of the Rent Act. It may be pointed out that the Appeal Court had recorded a finding that the tenant had not complied with the conditions under section 12(3)(b) of the Rent Act. An additional fact which has to be noticed is that prior to the issue of the notice following which the suit for eviction was filed, the landlord had issued a notice earlier on 1st May, 1968 calling upon the tenant to pay rent and to this notice, the tenant had sent a reply dated 24th May, 1968 mentioning therein that the landlord was demanding excessive rent and that agreed rent was not the standard rent. No action was, however, taken by the landlord on this notice and the suit was filed only after the second notice was issued. While disposing of the writ petition the learned Judge found that on the date on which the suit notice was sent on 12th March, 1971, there was already a dispute relating to the standard rent. The learned Judge then posed a question, namely, 'whether it is necessary that the dispute about the standard rent should be raised after the notice under section 12(2) of the Bombay Rent Act is issued or whether it is sufficient that such a dispute existed on the date on which the notice is issued or even prior to that.' The learned Judge referred to the decision in Abbashbhai's case and read that decision as an authority for the proposition that 'in order to establish that there is a dispute about the standard rent, it is not necessary for a tenant to make an application under section 11(3) read with Explanation I of section 12 of the Bombay Rent Act within one month after the receipt of the notice under section 12(2).'. The learned Judge further went on to observe : 'Such a dispute could be raised in a manner other than by the filing of an application for fixation of standard rent.' It is the correctness of this view which has been the subject of debate at the bar before us. The learned Judge then referred to the decision in Harbanslal's case, and found that in Harbanslal's case the Supreme Court had approved of the law laid down by the Gujarat High Court in Ambalal v. Babaldas, : AIR1964Guj9 . The law laid down in Ambalal's case, according to the learned Judge, was as follows :

'In order to attract the applicability of section 12(3)(a) of the Act there must be non-existence of the dispute at the date of the notice and such non-existence must continue right up to the expiration of one month from the date of service of the notice so that if the dispute is raised at any time prior to the expiration of the said period of one month, the operation of section 12(3)(a) would be excluded.'

The learned Judge noticed the observations of the Supreme Court in Harbanslal's case that in order to escape from the consequences mentioned in section 12(3)(a) of the Rent Act, the tenant should make an application under section 11(3) of the Rent Act within one month of the service of the notice under section 12(2) but went on to observe : 'This of course is one of the ways in which a case is taken out of the clutches of section 12(3)(a) of the Act.' And then further observed as follows :---

'Since it has been in unmistakable terms mentioned by the Supreme Court (Reference is to Harbanslal's case) that a dispute can exist either on the date of the notice or within one month after the notice by an appropriate reply to the notice (without making an application under section 11(3) of the Bombay Rent Act), it is clear that an application under section 11(3) read with Explanation I to section 12 of the Bombay Rent Act is not the only way of showing that there is a dispute about the standard rent.'

In support of this, the learned Judge quoted the decision of the Full Bench of the Gujarat High Court in Ramniklal's case.

12. It will be our endeavour to find out and ascertain on a reading of the two judgments of the Supreme Court in Dhansukhlal's case and Harbanslal's case whether the proposition which has been laid down by the learned Single Judge that if a reply has been given by a tenant to a notice issued by the landlord under section 12(2) of the Rent Act and in that reply he had disputed the standard rent, that is a permissible way of raising a dispute for the purposes of taking the case out of the clutches of section 12(3)(a) of the Rent Act.

13. Before we refer to the two decisions of the Supreme Court, it would be appropriate to refer to a Full Bench decision of this Court in Dattu Subhana v. Gajanan Vithoba 73 Bom.L.R. 371, in which the Full Bench was considering the provisions of section 12(3)(a) and 12(3)(b) of the Rent Act and the Full Bench took the view that a tenant can raise a dispute as to the standard rent after a suit is filed against him for eviction on the ground of non-payment of rent for more that six months, by his written statement and that would be a dispute for the purposes of section 12 of the Act. The Full Bench further took the view that the dispute contemplated in section 12(3)(a) is not limited to the dispute within one month of the notice under section 12(2) as required by Explanation I.

14. Now, the decision in Harbanslal's case was given in two appeals. The appeal of Harbanslal was an appeal from a judgment of the Gujarat High Court, while the other appeal, Rev. Everett M. Fasanachat and another v. West End Works, was an appeal from a decision of this Court in Special Civil Application No. 859 of 1967 decided on 31st March, 1971. We have sent for the original record of that petition. The facts in that case show that the tenancy of the tenant was terminated by notice dated 5th April, 1963 because they were in arrears of rent from 15th March, 1960 to 15th March, 1963 amounting in all to Rs. 3600/-. Some amounts by way of insurance premium were also claimed from the tenant. Apart from other grounds on which the suit was contested, a plea introduced by way of amendment to the written statement was that the standard rent of the premises was Rs. 50/- and the landlords could not demand anything more. The trial Court fund in favour of the plaintiffs and found the standard rent to be Rs. 100/- per month and the tenants were found to be defaulters in respect of rent from March 15, 1960. A decree for possession came to be passed along with the decree for arrears. The tenant's appeal against the decree came to be dismissed by the Assistant Judge who held that the provisions of the Bombay Rent Act were not applicable as the suit premises were used for the purpose of manufacture, but a finding was recorded, if necessary, that the case fell under section 12(3)(a) and not under section 12(3)(b) and that the standard rent was Rs. 100/-. The tenant then file a petition under Article 227 of the Constitution of India in this Court. One of the arguments advanced on behalf of the tenant was that though the tenancy was validly terminated, no decree for eviction could be passed against the tenant so because the tenant as were always ready and willing to pay the rent and there was a dispute with regard to the amount payable by the tenants in view of the damage caused to the building and also in view of the fact that in 1939, the rent was fixed at Rs. 50/- per month for the same premises and in 1951 the rent was increased to Rs. 100/- The learned Judge, who decided the petition, took the view that the Assistant Judge was in error in applying the provisions of section 12(3)(a) to the facts of the case as there was a dispute about standard rent payable by the tenants and in such a case, section 12(3)(a) would not apply. The learned Judge noticed the view taken by the learned Assistant Judge that a dispute raised by the tenant was not a bona fide dispute and went on to observe that the words 'bona fide dispute' were not to be found in section 12(3)(a) and that if there is a dispute, whether the dispute is bona fide or mala fide, it is a dispute within the meaning of section 12(3)(a). The learned Judge found that the written statement having been allowed to be amended, the Assistant Judge was not right in referring to the original written statement and in holding that there was no bona fide dispute. The learned Judge then made the following observations :---

'It is now settled by the decision of the Full Bench of this Court in Special Civil Application No. 781 of 1968 decided on August 17, 1970, Dutta Subhana v. Gajanan Vithoba 73 Bom.L.R. 371 :

'Explanation I is not the only mode in which the tenant's readiness and willingness to pay can be established. It is no doubt one mode and if fulfilled will give the tenant protection under section 12 itself, but there is nothing in the provisions of section 12 to indicate that the tenant cannot raise a dispute such as is contemplated in section 12 when he comes to be sued in the Court for recovery of rent by raising the issue as to standard rent in his written statement in answer to the suit. In our opinion, the cumulative effect of section 11(4) read with the provisions of section 12 squarely will be that he can do so.'

The defendants in the present case did so. Therefore, the learned Assistant Judge was wrong in applying the provisions of section 12(3)(a) to the facts of the case.'

The observations quoted above will thus clearly indicate that when the learned Judge took the view that the case was not covered by section 12(3)(a) of the Rent Act, he had taken the view that it was permissible to raise a dispute in a mode other than the one prescribed by Explanation I to section 12 read with section 11(3) of the Rent Act and for this he found support in the decision of the Full Bench. That is how the applicability of section 12(3)(a) of the Rent Act to the facts of the case was negatived. Now, it was this decision which became the subject-matter of appeal before the Supreme Court in Harbanslal's case and that decision must now be read in the light of these facts.

15. It is important to point out that in the other appeal with which the Supreme Court was dealing and which had come to the Supreme Court from the Gujarat High Court, the view taken by the Gujarat High Court was that the dispute as to standard rent was to be raised within one month from the service of the notice on the tenant. It appears that the finding in the Gujarat case was that after the notice was given by the landlord on 6th December, 1966 to the tenant, a letter was alleged to have been sent by the tenant on 16th February, 1967 though two earlier letters mentioned in that letter were found to have been fabricated. Referring to the decision of this Court the Supreme Court observed as follows :---

'The view of the Bombay High Court overlooks the limitation of time within which a dispute is to be raised as to standard rent. The view of the Bombay High Court is that disputing within one month of the service of the notice terminating the tenancy is one mode of raising a dispute and there is another mode of raising the dispute at any stage of the suit. The view of the Bombay High Court nullifies the provisions contained in section 12 and Explanation thereto and confers a right on the tenant where the legislation does not contemplate such a right.'

Now, when the Supreme Court in the above quoted paragraph did not approve of the view taken by this Court that disputing the standard rent within one month of the service of the notice is one mode of raising a dispute and observed that this view nullifies the provisions contained in section 12 and Explanation thereto, the Supreme Court must be held to have positively taken the view that apart from the mode referred to in the Explanation to section 12, the tenant has no other mode in which the tenant can raise a dispute about standard rent for the purposes of section 12(3)(a). When the Supreme Court observed that the view of this Court nullifies the Explanation and overlooks the limitation, it is obvious that the reference was to the limitation of one month prescribed by Explanation I to section 12. That Explanation in unmistakable terms requires that in any case where there is a dispute as to amount of standard rent or permitted increases recoverable under the Act, the tenant shall be deemed to be ready and willing to pay such amount if before the expiry of the period of one month after notice referred to in sub-section (2) of section 12, he makes an application to the Court under sub-section (3) of section 11 and thereafter pays or tenders the amount of rent or permitted increases specified in the order made by the Court. When the Supreme Court observed that the provisions of section 12 were being nullified, the reference was to the provisions of section 12(1) and section 12(3)(a).

16. section 12(1) disables a landlord from recovering possession of any premises so long as the tenant pays or is ready and willing to pay the amount of standard rent and permitted increases and observes and performs the other conditions of the tenancy so far as they are consistent with the provisions of the Rent Act. In a case where there is a dispute, the Legislature has provided for a deeming fiction whereby a tenant can be considered to be ready and willing to pay only if he acts in the manner provided by Explanation I. Explanation I contemplates two things. It firstly requires the tenant to make an application for fixation of standard rent within the specified period, namely before the expiry of one month after the notice under section 12(2) is received by him and the second condition is that he has to pay or tender the amount of rent or permitted increases specified in the order made by the Court. Unless these two conditions are satisfied, it cannot be said that the tenant is ready and willing to pay the amount of standard rent as contemplated by section 12(3)(a). The Explanation clearly provides for what the tenant is to do where he wants to raise a dispute about the standard rent before he can claim to be out of the rigour of section 12(3)(a) of the Rent Act.

17. When the appeal of the landlord was allowed by the Supreme Court in the West End Works's case and Harbanslal's case, the only result of the decision of the Supreme Court can be that the view which this Court had taken in the judgment appealed against, that the mode provided by Explanation I to section 12 was only one of the mode of raising a dispute and that there were other modes and the first mode was not the exclusive mode, must naturally be taken to have been overruled.

18. The matter, in our view, is clinched by the observations of the Supreme Court in paragraph 25 of the judgment in Harbanslal's case. These observations are as follows :---

'The provisions in section 11(3) of the Act deal with orders which may be passed by the Court during the pendency of the application disputing the rent. Provisions in section 11(4) of the Act deal with orders which may be passed consequent upon dispute as to rent. It is only when an application disputing rent is made within the time contemplated by Explanation I to section 12 of the Act that the provisions in sub-sections (3) and (4) of section 11 are attracted.' (Underlining ours).

The Supreme Court in these observations has emphasised the time element which is proscribed by Explanation I because it is by this Explanation that there is an obligation on the tenant, if he wants to raise a dispute with regard to standard rent, that he must make an application under section 11(3) within a period of one month.

19. Now, if you go to section 11(3) of the Rent Act, it expressly refers to an application for fixing standard rent by a tenant who has received a notice from his landlord under sub-section (2) of section 12. When such application is made, there is an obligation on the Court to forthwith specify the amount of rent or permitted increases which are to be deposited in Court by the tenant and the Court is further obliged to make an order directing the tenant to deposit such amount in Court or at the option of the tenant make an order to pay to the landlord such amount thereof as the Court may specify pending the final decision of the application. It is important to point out that under section 11(3) it is provided that if the tenant fails to deposit such amount or, as the case may be, to pay such amount thereof to the landlord, his application shall be dismissed. In other words, the effect of the provisions of section 11(3) is that if the tenant fails to comply with the order made by the Court in the application under section 11(3), the tenant will be relegated to the same position in which he was before making, the application and the result will be that it will have to be held that no dispute has been raised by him.

20. Now, in Harbanslal's case, the Supreme Court has referred to the earlier decision in Dhansukhlal's case, the Supreme Court has considered the provisions of section 12(1) and the Explanation and the flowing observations are relevant :---

'section 12(1) must be read with the Explanation and so read it means that a tenant can only be considered 'to be ready and willing to pay 'if, before the expiry of the period of one month after notice referred to in sub-section (2), he makes an application to the Court under sub-section (3) of section 11 and thereafter pays or tenders the amount of rent or permitted increases specified by the Court.'

In that case, it was found as a fact that the tenant had made no payment within the period of one month of the notice of ejectment and although in his written statement he raised a dispute about the standard rent, he had made no application in terms of section 11(3) of the Rent Act. In that context the Supreme Court pointed out that where a suit is filed on the ground that the tenant was in arrears for a period of more than six months and although raising a dispute as to the standard rent or permitted increases recoverable under the Act, the tenant makes no application in terms of section 11(3), he cannot claim the protection of section 12(1) by merely offering to pay or even paying all arrears due from him when the Court is about to pass a decree against him. The Supreme Court then observed as follows :---

'........if sub-section (3)(a) is not attracted the tenant, if he is in arrears, cannot sit quiet and offer to pay all the amount due from him at the time of the hearing of the suit so as to get the protection of 12(1). To be within the protection of sub-section (1) where he raises a dispute about the standard rent payable he must make an application to the Court under sub-section (3) of section 11 and thereafter pay or tender the amount of rent and permitted increases, if any, specified in the order made by the Court. If he does not approach the Court under section 11(3), it is not open to him thereafter to claim the protection of 12(1).'

The observations quoted by us, in our view, clearly indicate that the tenant can only be considered ready and willing to pay if he makes an application to the Court under sub-section (3) of section 11 and thereafter pays or tenders the amount of rent or permitted increases specified by the Court. We shall presently refer to the decision of the Full Bench of the Gujarat High Court where a view has been expressed that the use of the word 'only' by the Supreme Court in its decision was not intended to exclude any other mode of raising a dispute, though we are inclined to take the view that this controversy is now academic in view of the observations of the Supreme Court in Harbanslal's case. As we have already pointed out, that decision has the effect of overruling the earlier decision of this Court which had taken the view that there was more than one mode of raising the dispute as to standard rent.

21. Referring to the decision in Dhansukhlal's case, the Supreme Court in paragraph 23 has observed as follows :---

'This Court found in Chhaganlal's case A.I.R. 1963 S.C. 1109 (supra) (Reference is to Dhansukhlal Chhaganlal's case) that the tenant made no payment within the period of one month of the notice of ejectment and further that although in his written statement he raised a dispute about the standard rent he made no application in terms of section 11(3) of the Act. The tenant can claim protection from the operation of section 12(3)(a) of the Act only if the tenant makes an application within one month of the service of the notice terminating the tenancy by raising a dispute as to standard rent'. (Underlining ours).

It is significant to point out that the decision in Dhansukhlal's case has been ready by the Supreme Court as laying down that the only way in which a tenant can claim the protection from the operation of section 12(3)(a) is that the tenant must make an application within one month of the service of the notice terminating the tenancy by raising a dispute as to standard rent. Apart from the other observations of the Supreme Court in Harbanslal's case, it is difficult for us to see how any controversy can now survive as to whether there is any other mode of raising a dispute in view of the above quoted observations of the Supreme Court while construing Dhansukhlal's case.

22. Referring to these above quoted observations, Jahagirdar, J., has in paragraph 10 observed : 'It is true that in Harbanslal's case the Supreme Court has mentioned that in order to escape from the consequences mentioned in section 12(3)(a) of the Bombay Rent Act, the tenant should make an application under section 11(3) of the said Act within one moth of the service of the notice under section 12(2). This of course is one of the ways in which a case is take out of the clutches of section 12(3)(a) of the Act.' With respect, in our view, the construction placed on the observations of the Supreme Court that the Supreme Court was referring to only one of the modes in which a case is taken out of the clutches of section 12(3)(a) is not justified. The consequences which must necessarily follow from the use of the word 'only' by the Supreme Court in the observations quoted above at the end of paragraph 23 has not been given effect to by the learned Judge and if the observations in paragraph 24 are properly read, they in our view, leave no room for doubt that the only mode of raising a dispute is by making an application under section 11(3) of the Act. We are, therefore, unable to concur with the view taken by the learned Judge that an application under section 11(3) is only one of the ways in which the case is taken out of the clutches of section 12(3)(a) of the Rent Act. These observations, in our view, are directly contrary to the decision of the Supreme Court in Harbanslal's case.

23. It is not doubt true that such a view has been taken by the Full Bench of the Gujarat High Court in Ramniklal's case. In Ramniklal's case, the Full Bench of the Gujarat High Court has approved of the view taken in an earlier decision in Ambalal v. Babaldas, : AIR1964Guj9 , as regards the stages at which the dispute as to the standard rent could be raised and also the manner in which it could be raised and three propositions of law were laid down. The third proposition is the relevant proposition for our purpose and it was as follows :---

'The tenant can also claim protection from the operation of section 12(3)(a) of the Act by raising a dispute as to the standard rent either prior to the notice under section 12(2) of the Act or by reply to the notice but in this case the tenant must do so within one month from the receipt of the notice referred to in section 12(2) of the Act.'

We have already pointed out that in view of the fact that the decision in Harbanslal's case was given in an appeal directed against the judgment of this Court which followed a Full Bench decision of this Court in which it was held that an application under section 11(3) was only one of the modes raising a dispute and that decision has been set aside, the third proposition in so far as it holds that the dispute can be raised by a reply to the notice under section 12(2) of the Rent Act within one month must now, in our view, be no longer held to be good law. Apart from the controversy as to whether there can be any other mode than the one provided by Explanation I read with section 11(3), it is difficult for us to find any sanction for the element of limitation introduced in this proposition for giving a reply to the notice. The period of one month is statutory fixed by Explanation I to 12, but that is for making an application under section 11(3). The other reference to a period of one month is in section 12(3)(a), but that is in the context of the tenant neglecting to make a payment of the arrears. No other provision under the Rent Act has been brought to our notice on the basis of which this element of limitation for replying to the notice can be substantiated.

24. One of the decisions on which Jahagirdar, J., has relied for holding that a dispute with regard to standard rent could be raised in a manner other than by filing of an application under section 11(3) of the Rent Act is the decision of the Supreme Court in Vora Abbasbhai's case. In Vora Abbasbhai's case, the notice served by the landlord on the defendant (tenant) calling upon him to deliver possession of the premises on the ground that he had failed to pay rent since October 1, 1955 was given on 1st December, 1956 and was served on 3rd December, 1956. On 7th December, 1956 the tenant sent a reply that he had paid rent at the agreed rate up to 1st April, 1956 and on 5th January, 1957 he made an application under section 11(1) of the Bombay Rent Act for an order fixing the standard rent and also for an order under section 11(3) specifying interim rent. The tenant sent a letter to the landlord on 7th January, 1957 informing him about the application moved by him. The suit for ejectment was instituted on 27th January, 1957. The suit was dismissed by the trial Court which held that the standard rent was Rs. 50/- and taking into account the aggregate amount deposited, it was held that the defendant was not liable to be evicted for non-payment of standard rent and in any event, it was established that the defendant was ready and willing to pay the amount of standard rent and permitted increases. The Appeal Court treated the case as one under section 12(3)(b) and the decree of dismissal was confirmed. However, in revision, the High Court set aside the dismissal holding that the defendant was not ready and willing to pay the standard rent at the date of the suit and that he did not comply with the requirement of section 12(3)(b) of the Rent Act because he had not deposited in Court the amount of standard rent at the rate determined by the order of the District Court and had not paid even the interim rent at the rate fixed by the Court of first instance and further that he had not paid costs of the suit which he was bound to pay under section 12(3)(b).

25. Referring to Explanation I to 12 of the Rent Act, the Supreme Court observed that the Explanation enacts a rule of evidence and if after service of the notice upon the tenant by the landlord under sub-section (2) of 12 the tenant makes an application under sub-section (3) of section 11 before the expiry of a month and thereafter pays or tenders regularly the amount of interim rent specified by the Court till the disposal of the suit, the Court is bound to presume that the tenant is at the date of the decree ready and willing to pay the standard rent and permitted increases. The judgment discloses that the question as to whether the case was covered by section 12(3)(a) or not was never debated before the Supreme Court. What was contended on behalf of the plaintiff in that case was that the dispute concerning standard rent contemplated by section 12(3)(b) should have been raised before the service of the notice under section 12(2). The contention was rejected. The observations in paragraph 13 of the judgment were as follows :---

'The claim made by the defendant fell within the terms of section 12(3)(b) and not section 12(3)(a). The defendant had contended by his reply dated December 7, 1956 to the notice served by the plaintiff that the contractual rent was excessive; he had then raised the same contention in the application filed for fixation of standard rent and in his written statement filed in the suit. There is nothing in 12 to support the contention raised by Mr. Chatterjee on behalf of the plaintiff that the dispute concerning standard rent contemplated by Clause (b) of sub-section (3) is one which must have been raised before service of the notice under section 12(2). The entire tenor of the section is against that interpretation.'

We are unable to find anything in the decision of the Supreme Court in Vora Abbasbhai's case which can be read as an authority for the proposition that a dispute for the purposes of section 12(3)(a) need not necessarily be raised only by an application under section 11(3) but that even if a reply is given by the tenant to the landlord disputing the standard rent, the case will be taken out of the provisions of section 12(3)(a).

26. What was exactly decided in Vora Abbabhai's case has been considered by the Supreme Court in the decision in Harbanslal's case. In paragraph 21, the Supreme Court observed as follows :---

'The only point in controversy in Abbasbhai's case, : [1964]5SCR157 , Reference is to Vora Abbasbhai's case, was whether the second condition in section 12(3)(a) of the Act, viz., that there was no dispute regarding the amount of standard rent was fulfilled. The landlord's contention was that the dispute concerning standard rent is one which must have been raised before service of the notice and since there was admittedly no dispute in regard to standard rent or permitted increases at the date of service of the notice under section 12(2) of the Act the second condition in section 12(3)(a) that there was no dispute was satisfied. The Court did not accept the landlord's contention there and held that the defendant in that case raised the contention by reply dated 7th December, 1956 that the contractual rent was excessive and raised the same contention in the application filed for fixation of standard rent.'

27. It is important to point out that if we read the decision in Vora Abbasbhai's case as an authority for the proposition that a dispute with regard to standard rent can be raised by more than one mode, that would run counter to the ratio of Harbanslal's case in which we have already pointed out, the Supreme Court has positively laid down that the only way to get protection from the operation of section 12(3)(a) is for the tenant to make an application within one month from the service of the notice terminating the tenancy by raising a dispute with regard to standard rent. We are, therefore, unable to hold that the decision in Vora Abbasbhai's case in any way supports the view which was taken by the learned Judge in Gulabchand's case.

28. Now, what is argued is that the Supreme Court in Vora Abbasbhai's case has approved of the judgment of the Gujarat High Court in Ambalal's case : AIR1964Guj9 . The passage quoted by Jahagirdar, J., in Gulabchand's case from the decision in Ambalal's case is as follows:

'In order to attract the applicability of section 12(3)(a) of the Act there must be non-existence of the dispute at the date of the notice and such non-existence must continue right up to the expiration of one month from the date of service of the notice so that if the dispute is raised at any time prior to the expiration of the said period of one month, the operation of section 12(3)(a) would be excluded.'

Now there is no doubt these observations have also been approved by the Supreme Court in Harbanslal's case. But what was the question before the Gujarat High Court in Ambalal's case has been stated by the Supreme Court in Harbanslal's case as follows :---

'In Ambalal's case, (supra) the conclusion is a single one it is that in order to exclude the operation of section 12(3)(a) of the Act the dispute must be in existence latest within one month after service of the notice.'

Ambalal's case, therefore, did not deal with the mode of raising a dispute but merely dealt with the outer limit of time with regard to the existence of the dispute and that, according to the decision in Ambalal's case was within one month after the service of the notice.

29. The Full Bench decision of the Gujarat High Court no doubt holds that the tenant can also claim protection from the operation of section 12(3)(a) by raising a dispute as to the standard rent either prior to the notice under section 12(2) of the Act or by reply to the notice, but in this case, the tenant must do so within one month from the receipt of the notice referred to in section 12(2). However, the Full Bench in that case, while considering the decision of the Supreme Court in Harbanslal's case the reference to that case was made only in the context of the fact that the Supreme Court had to resolve the question as to whether on receipt of a notice from the landlord terminating the tenancy on the ground of arrears of rent, dispute as to standard rent had to be raised before expiry of one month after the service of the notice. The Full Bench also further pointed out that the Supreme Court had made clear that 12(1) of the Rent Act had to be read with the Explanation to that section and the ratio of the decision in Dhansukhlal's case was stated to be as follows :

'The ratio of this decision is clearly that protection under 12(1) of the Act can be availed of only if before the expiry of the period of one month after the notice referred to in sub-section (2) of 12 of the Act the tenant makes an application under section 11(3) of the Act and thereafter he pays or tenders the amount of rent or permitted increases specified by the Court.' (See paragraph 7).

The Full Bench then pointed out in the same paragraph that 'the clear and specific proposition of law laid down therein is to the effect that in order to avoid the provisions of 12(3) by claiming protection under 12(1), the tenant has to make an application under section 11(3) of the Act before the expiry of one month of the receipt of the notice under section 12(2) of the Rent Act or, to put in other words, the tenant can get protection under 12(1) provided he has made an application under section 11(3) of the Act within one month of the receipt of the notice under section 12(2) of the Act.' Referring to the use of the word 'only' by the Supreme Court in Dhansukhlal's case, the Full Bench has taken the view that 'the word 'only' is used to emphasise as to when the factum of readiness and willingness of the tenant is said to be established by the statutory presumption under 12(1) read with the Explanation and it is so established provided the provisions of 12(1) read with the Explanation are complied with.' The Full Bench then observed that 'the word 'only' supplies an emphasis to the expression 'to be ready and willing to pay' and the readiness and willingness can also be proved by statutory presumption which arises on the provisions of the Explanation being satisfied.' 'The word 'only' ', according to the Full Bench of the Gujarat High Court, 'has not the effect that the tenant can obtain protection by raising a dispute as to the standard rent only in one manner, namely, if the tenant makes an application within one month of the service of the notice terminating the tenancy by raising a dispute as to the standard rent.' According to the Full Bench, 'if the tenant wants to avail himself of the statutory presumption arising under 12(1) and the Explanation, he has to make the application under section 11(3) of the Act within one month after the notice referred to in section 12(2) of the Act and to pay or tender the amount of rent and permitted increases specified in the order made by the Court.'.

30. As already pointed out, we are unable to read the judgment of the Supreme Court in Dhansukhlal's case in the manner it has been read by the learned Judges of the Full Bench of the Gujarat High Court, in view of the observations made by the Supreme Court in Harbanslal's case where while dealing with Dhansukhlal's case the Supreme Court categorically and in unequivocal terms had observed as follows :

'The tenant can claim protection from the operation of section 12(3)(a) of the Act only if the tenant makes an application within one month of the service of the notice terminating the tenancy by raising a dispute as to standard rent.' (Underlining ours.)

It is no doubt true that in Ramniklal's case the Full Bench has observed that in Dhansuklal's case and Harbanslal's case, the Supreme Court has not considered all the methods or manners in which the dispute as to standard rent can be raised under section 12(2) of the Act to avoid a decree of eviction under 12(3) of the Act. These observations presume that apart from the mode provided by the Act there are any other modes of raising a dispute about standard rent. Such an approach is, however, in our view, not at all open having regard to the decision of the Supreme Court that the only mode of raising a dispute is as provided in the Act if protection from the operation of section 12(3) of the Act is to be claimed by the tenant. With respect, therefore, we dissent from the view taken in Ramniklal's case.

31. We may also point out that the decision of the Supreme Court in Harbanslal's case was earlier considered by a Division Bench of this Court in Champalal Pratapmal v. Municipal School Board (Primary School) Nandurbar (Special Civil Application No. 2810 of 1911 decided on 20th June, 1977). In view of certain conflicting views as to when the provisions of section 12(3)(b) of the Rent Act would be attracted, one of us (Chandurkar, J.) had made a reference to a Division Bench in respect of two questions as follows :---

'(1) Whether in a suit for eviction it is not obligatory for the tenant to apply for an order under section 11(4) of the Rent Act, if he wants to avail of protection under section 12(3)(b) of the Act, and

(2) Whether in view of the decision of the Supreme Court in Shah Dhansukhlal's case 70 Bom.L.R. 174 the Rent Court has discretion not to pass a decree for eviction in a case governed by section 12(3)(a) of the Rent Act, if the tenant has deposited the entire arrears of rent before the decision of the suit ?'

This reference was made before the decision in Harbanslal's case was rendered by the Supreme Court. When the matter was dealt with by the Division Bench, the Division Bench found that the answer to the above two points could be found in the latest judgment of the Supreme Court in Harbanslal's case. While dealing with the decision in Harbanslal's case the Division Bench observed as follows :---

'When a tenancy is being terminated on the ground of arrears of rent for more than six months, what the tenant must do in order to obtain the protection of the Rent Act has now been clarified. In Harbanslal's case, the Supreme Court points out that in order to avoid the operation of section 12(3)(a) of the Act the dispute in regard to standard rent or permitted increases must be raised at the latest before the expiry of one month from the date of service of notice under section 12(2) of the Act and it is not enough to raise a dispute for the first time in written statement. They specifically point out that the view taken by this Court at one time in the past, viz., that disputing within one month of the service of the notice terminating the tenancy is one mode of raising a dispute and there is another mode of raising the dispute at the stage of the suit nullifies the provisions contained in 12 and Explanation thereto and confers a right on the tenant where the legislation does not contemplate such a right.'

(Underlining ours.)

Pointing out that the only mode of raising a dispute with regard to standard rent was by making an application under section 11(3) of the Rent Act, the Division Bench observed as follows :---

'It is, therefore, now clear that where rent is payable by month and there are arrears of more than six months and the tenancy is terminated by valid notice, either the entire arrears of rent must be paid within one month or if a dispute regarding standard rent has to be raised, the tenant must apply within one month of the date of the receipt of the notice under section 11(3) and obtain appropriate direction from the Court. If he complies with those directions, he must be deemed to be a person who is ready and willing to pay. No third mode is now available for getting the protection of the Rent Act on the basis that the tenant is one who is ready and willing to pay.' (Underlining ours.)

It does not appear that this decision of the Division Bench was cited before Jahagirdar, J.

32. On giving our anxious consideration to the legal position as now settled by the decisions of the Supreme Court, we are of the considered view that the only way to prevent a decree for eviction being passed under the provisions of section 12(3)(a) of the Rent Act is that the tenant must make an application raising a dispute regarding standard rent and must ask for fixation of standard rent under section 11(3) of the Rent Act as required by Explanation I to 12. There is no other mode permissible for raising a dispute as to standard rent for the purposes of 12 of the Rent Act. By raising a dispute with regard to standard rent by the tenant in a reply to the demand notice before the expiry of one month without making an application under section 11(3) read with Explanation I to 12, the Court will not be prevented from passing a decree for eviction under the provisions of section 12(3)(a). The fact that there was some dispute about standard rent prior to the notice under section 12(2) would also be immaterial and would not affect the power of the Court to pass a decree under section 12(3)(a) if the conditions referred to in section 12(3)(a) are satisfied if no application has already been made under section 11(1) of the Act. This will answer the first two questions raised in the order of reference.

33. So far as the third question is concerned, it has not been canvassed before us by either side that the view taken by Jahagirdar, J., in paragraph 12 of the judgment, where the learned Judge follows two earlier decisions of this Court in Karamsey v. Velji 56 Bom.L.R. 619, and 11, Sayed Umar Sayed Ahmed v. Dadamiya 1977 Mh.L.J. 261, is in any way erroneous. The view taken by Jahagirdar, J., following these two decisions was that where a dispute about standard rent has already been raised by filing an application under section 11(1) of the Rent Act even before the issue of a notice under section 12(2) by the landlord, it was not necessary for the tenant to file a further application under section 11(3) read with Explanation I to 12 of the Rent Act, in order to attract the provisions of section 12(3)(b) of the Rent Act.

34. Before we deal with the two petitions before us on their own merits, since one of the arguments advanced in Special Civil Application No. 1866 of 1977 on behalf of the tenant was that the tenant was entitled to the benefit of section 12(3)(b) in any case because he had deposited the entire amount of arrears by the time the judgment came to be passed and reliance was placed on the decision of Jahagirdar, J., in Gulabchand's case, it is necessary to refer to the view which Jahagirdar, J., had taken with regard to the construction of section 12(3)(b) of the Rent Act. The learned Judge has taken the view that if the Court allows explicitly or by necessary implication the payment of rent on dated other than the first date of hearing and the tenant makes payments which are treated as payments as per the Court's order, it would be compliance with the provisions contained in section 12(3)(b) because the orders relating to the deposit of rent in the Court are orders of procedural nature and the Court must have power to condone the delay, if any, in the said payments under section 148 of the Code of Civil Procedure. The learned Judge had further taken the view that even under the provisions of section 12(3)(b) of the Rent Act there is enough latitude to the Court to re-schedule the dates of payment after they are once fixed. In Gulabchand's case, the learned Judge reiterated the view taken by him earlier in Mohanlal v. Khimraj 1978 Mh.L.J. 611, where the learned Judge had held that any defaults made by the tenant in payment of rent as directed by the Court could be condoned by the Court and reliance was placed on the decision of this Court in Kalidas Bhawan v. Bhagvandas 60 Bom.L.R. 1359, where the view taken was that when the Court accepts the deposits made by the tenant, in the eye of law the Court must be taken to have permitted the tenant to make these deposits and to make them on dates on which these deposits were accepted. It was pointed out in that case that the deposit could not be made in the Court without the permission of the Court and the Court if knowing that the tenant has not made the deposit on the first day permits him to make the deposit on the subsequent date would in doing so, in substance if not in form, be permitting the tenant to make the deposit on the date on the date on which it accepted the deposit. In Gulabchand's case, the learned Judge took the view that his view in Mohanlal's case following Changla, C.J.'s judgment in Kalidas's case was is no way affected by the judgment of the Supreme Court in Ganpat v. Sashikant, : [1978]3SCR198 .

35. Now, it is well-known that section 12(3)(b) is attracted to a case which does not fall within section 12(3)(a). Section 12(3)(a) applies to a case where rent is payable by the month and there is no dispute regarding the amount of standard rent or permitted increases. In such a case, if the rent or permitted increases are in arrears for a period of six months or more and the tenant neglects to make payment thereof until the expiration of the period of one month after the notice under section 12(2), the Court is bound to pass a decree for eviction. In a case which does not fall under section 12(3)(a), the power of the Court to pass a decree is regulated by section 12(3)(b) which is worded in a negative language. Section 12(3)(b) provides that the Court will not pass a decree for possession if on the first day of hearing of the suit or on or before such other date as the Court may fix, the tenant pays or tenders in Court the standard rent and permitted increases due from the him and thereafter the tenant continues to pay or tender in Court regularly such rent and permitted increases till the suit is finally decided and also payable costs of the suit as directed by the Court. In Venkatrao Anant v. Narayanlal 71 Bom.L.R. 607, this Court has taken the view that the obligation of the tenant to continue to pay or tenders in Court standard rent or permitted increases continues even during the pendency of the appeal. It was held in that case that where the trial Court has fixed the standard rent under the Rent Act, it is obligatory for the tenant to pay the amount so fixed during the pendency of his appeal to the higher Court and non-payment of such rent will disentitle him to the protection under the Rent Act.

36. Now, in the case of Kalidas Bhavan v. Bhagvandas, Chagla, C.J., had taken the view that the emphasis in section 12(3)(b) was not on payment on the first day of hearing but the emphasis is that the arrears should be paid before judgment is delivered on the suit for eviction. A Division Bench of this Court in Shantabai v. Ganpat, : AIR1976Bom288 took the view that the principle laid down by Chagla, C.J.., in Kalidas Bhavan v. Bhagvandas, should also be extended to the second condition in section 12(3)(b), namely, the obligation of the tenant to continue to pay or tender in Court regularly standard rent till the suit is finally that if on the facts of each case there is found to be substantial compliance with the provisions of section 12(3)(b), the Court may exercise its discretion and refrain from passing a decree for eviction.

37. It is necessary to refer in some detail to the facts of the case in Shantabai v. Ganpat, because the decision of the Supreme Court in Ganpat v. Sashikant, : [1978]3SCR198 was given in appeal against the Division Bench decision of this Court in Shantabai v. Ganpat. A dispute as to standard rent between the landlord and the tenant came to an end by a decision dated 1st September, 1960 whereby the standard rent was fixed at Rs. 54.25. Ganpat, the landlord, issued a notice on 29th June, 1960 demanding arrears of rent from May 1956 to 1960 at the rate of standard rent. A summary suit for eviction as well as for recovery of arrears of rent was filed by the landlord on 6th November, 1960. The Summons for judgment came up for hearing on 13th April, 1961. On that date, the tenant paid a sum of Rs. 3200/- into the Court, being the amount of standard rent up to 31st March, 1961. Leave was granted to the tenant to defend the suit. The suit came up for hearing on 30th August, 1962 when issues were framed. On that day, a sum of Rs. 1042.10, being rent for the period 1st April, 1961 to 31st August, 1962, was paid. The suit was then adjourned from time to time from 4th October, 1962 to 5th June, 1963 and on one of these dates, which was 28th November, 1962, the tenant paid a further sun of Rs. 162.75 as rent for the period 1st September, 1962 to 30th November, 1962. Additional issue were framed on 5th June, 1963 and on that day, the tenant paid Rs. 325.50 as rent for the period December 1962 to May 1963 together with the amount of permitted increases. On 6th June, 1963 evidence was recorded and decree for possession was given on 18th June, 1963. This decree was, however, set aside on a technical ground by the Appellate Bench of the Small Cause Court which held that the notice quite was not a valid notice, but that decision was set aside by this Court and the matter was sent back to the Appeal Bench took the view that the landlord was entitled to a decree for eviction under section 12(3)(a) and that even if the case was governed by section 12(3)(b), the tenant had not complied with the conditions thereof, so that it could not be said that the discretion vested in the Court to refuse to pass a decree for eviction. This decision of the Appeal Bench was challenged before a Division Bench of this Court. In view of the fact that a dispute as to standard rent was pending in a civil revision application even on the expiry of the period of one month from the date on which notice under section 12(2) was given, the Division Bench ruled out the application of section 12(3)(a). So far as section 12(3)(b) was concerned, when it was contended before the Division Bench of this Court that the decision in Kalidas Bhavan v. Bhagvandas was no longer good law, in view of the decision of the Supreme Court in Dhansukhlal's case, where it was observed by the Supreme Court :

'To be within the protection of that provision (section 12(3)(b)) the tenant must thereafter continue to pay or tender in Court regularly the rent and permitted increases till the suit is finally decided.'

the Division Bench took the view that

'............this appears to us to only a paraphrase of the relevant provision and we are unable how we are unable to appreciate how it can be said that the Supreme Court has even dealt with, much less overruled the decision of this Court in Kalidas Bhavan v. Bhagvandas : (1958)60BOMLR1359 .'

The Division Bench found as a fact that the tenant had not strictly complied with the provision as to payment of rent regularly but observed that all payments required to be made before the judgment was delivered and if this was so, then the Court's discretion not to pass a decree for eviction was clearly not taken away. The Division Bench further observed :

'............even if the conditions of section 12(3)(b) are not strictly complied with, the Court has discretion, on the facts and circumstances of each case, to decline to pass a decree for eviction.'

On facts the Division Bench held that there was substantial and sufficient compliance by the tenant of the provisions of section 12(3)(b) and that the circumstances of the case were such that the discretion of the Court be exercised in favour of the tenant. The effect of the Division Bench decision was that even if rent was not paid regularly during the pendency of the suit but if it was found that on the day on which the judgement was to be delivered the entire amount of arrears due up to that date had been paid, the tenant was entitled to the protection of section 12(3)(b).

38. The correctness of this judgment was challenged by the landlord in the Supreme Court. The Supreme Court referred to the earlier decision in Dhansukhlal's case and observed :---

'.........We think that the problem of interpretation and application of section 12(3)(b) need not trouble us after the decision of this Court in Shah Dhansukhlal's Chagganlal's case, : [1968]3SCR346 (supra) followed by the more recent decision in Harbanslal Jagmohandas v. Prabhudas Shivlal, : [1976]3SCR628 which completely covers the case before us.'

We have earlier referred to the decision in Dhansukhlal's case. Referring to the provisions of section 12(3)(b) of the Rent Act, the Supreme Court had in that the case observed as follows in paragraph 13 :---

'To be within the protection of that provision, the tenant must not only pay all the arrears due from him on the first day of hearing of the suit, but he must thereafter continue to pay or tender in Court regularly the rent and permitted increases till the suit is finally decided.'

These were the observations which the Division Bench of this Court had described as mere paraphrase of the section but which, according to the Supreme Court in Ganpat's case, had really concluded the construction of section 12(3)(b). After pointing out that the Rent Act interfered with the landlord's right to property and freedom of contract only for the limited purpose of protecting tenants from misuse of the landlord's power to evict them, in these days of scarcity of accommodation, by asserting his superior rights in property or trying to exploit his position by extracting too high rents from helpless tenants, the Supreme Court pointed out in Ganpat's case that the object of the Rent Act was not to deprive the landlord altogether of his rights in property which have also to be respected. Another object of the Rent Act was stated to be to make possible eviction of tenants who failed to carry out their obligation to pay rent to the landlord despite opportunities given by law in that behalf. The following observations are important :---

'Thus, section 12(3)(a) of the Act makes it obligatory for the Court to pass a decree when its conditions are satisfied as was pointed out by one of us (Bhagwati, J.) in Ratilal Balabhai Nazar v. Ranchodbhai Shankarbhai Patel, : AIR1968Guj172 . If there is statutory default or neglect on the part of the tenant, whatever may be its cause, the landlord acquires a right under section 12(3)(a) to get a decree for eviction. But where the conditions of section 12(3)(a) are not satisfied, there is a further opportunity given to the tenant to protect himself against eviction. He can comply with the conditions set out in section 12(3)(b) and defeat the landlord's claim for eviction. If, however, he does not fulfil those conditions, he cannot claim the protection of section 12(3)(b) and in that event, there being no other protection available to him, a decree for eviction would have to go against him. It is difficult to see how by any judicial valour discretion exercisable in favour of the tenant can be found in section 12(3)(b), even where the conditions laid down by its are satisfied, to be strictly confined within the limits prescribed for their operation. We think that Chagla, C.J., was doing nothing less than legislating in Kalidas Bhavan's case : (1958)60BOMLR1359 (supra), in converting the provisions of section 12(3)(b) into a sort of discretionary jurisdiction of the Court to relieve tenants from hardship. The decisions of this Court referred to above, in any case, make the position quite clear that section 12(3)(b) does not create any discretionary jurisdiction in the Court. It provides protection to the tenant on certain conditions and these conditions have to be strictly observed by the tenant who seeks the benefit of the section. If the statutory provisions do not go far enough to relieve the hardship of the tenant the remedy lies with the legislature. It is not in the hands of courts'.

The Supreme Court in these observations has in unambiguous words disapproved of the decision in Kalidas Bhavan v. Bhagvandas, the effect of which decision, according to the Supreme Court, was that the provisions of section 12(3)(b) were converted into a sort of discretionary jurisdiction of the Court to relieve tenants from hardships. The effect of the observations of the Supreme Court quoted above clearly is that the conditions specified in section 12(3)(b) have to be strictly observed if the tenant seeks the benefit of that section.

39. Section 12(3)(b) prescribes two conditions, as already pointed out, namely, that the arrears will be deposited or paid on the first day of hearing and thereafter rent must be paid or tendered in Court regularly till the suit is decided, and now in view of the decision of this Court in Venkatrao Anant v. Narayanlal 71 Bom.L.R. 607, cited above, till the appeal is also decided. In Ganpat v. Sashikant, the decision of the Division Bench of this Court was set aside by the Supreme Court. The effect of setting the decision of this Court can only be that the approach which was adopted by the Division Bench in holding that the tenant was entitled to the protection of section 12(3)(b) because the entire amount had been paid before the date of the judgment though it was not paid regularly, and that there was, therefore, a substantial compliance with section 12(3)(b) was not approved. The Division Bench is Shantabai v. Ganpat applied the principal enunciated by Chagla, C.J., in Kalidas Bhavan v. Bhagvandas. In our view, the effect of the decision of the Supreme Court in Dhansukhlal's case and in Ganpat v. Sashikant can be nothing else except that the decision in Kalidas Bhavan v. Bhagvandas must be treated as no longer good law.

40. Now, when these decisions were cited before Jahagirdar, J., the learned Judge seems to have read the decision in Ganpat's case as merely holding that if the conditions in section 12(3)(b) were not satisfied, the Court has no discretion to pass a decree for eviction and, according to the learned Judge, the other part of Chagala, C.J's judgment in Kalidas's case laying down that there is compliance with the provisions contained in section 12(3)(b) even if the tenant has made payments after the dates originally fixed by the Court and if the said delay was condoned and payments were accepted by the Court, has not been touched at all by the Supreme Court in Ganpat's case. As we have already pointed out, the judgment of the Division Bench against which the Supreme Court was deciding the appeal in Ganpat's case expressly proceeded on the footing that where payments had been accepted by the Court, the tenant will be entitled to the benefit of section 12(3)(b) on the principle of substantial compliance. It is this view which has been set aside by the Supreme Court. The observations of the Supreme Court that the conditions contained in section 12(3)(b) have to be strictly observed by the tenant who seeks the benefit of the section emphasise the fact that there was no question of any substantial compliance and if the conditions laid down are not satisfied, there is no power in the Court to grant any relief to the tenant. The very concept of extending the time for deposit which is specifically provided by the provisions in section 12(3)(b) as a condition which is strictly to be satisfied by the tenant would imply that the Court has a discretion to accept payment which is made otherwise in accordance with the requirement of section 12(3)(b). It is this discretion which the Supreme Court has held the Court did not have and which was being exercised so far by courts in view of the decision in Kalidas Bhavan v. Bhagvandas. We are, therefore, unable to concur with the view taken by Jahagirdar, J., that the decision of the Supreme Court in Ganpat v. Sashikant does not overrule the decision of Chagle. C.J., in Kalidas Bhavan v. Bhagvandas.

41. We shall now deal with the two petitions on facts. Now, so far as Special Civil Application No. 1812 of 1977 is concerned, admittedly within one month from the date of the receipt of the notice under section 12(2) of the Rent Act, there was neither as application made for fixation of standard rent, nor were the arrears due paid. That was, therefore, a case where the provisions of section 12(3)(a) were clearly attracted. The view which the learned Assistant Judge had taken was based on the fact that dispute with regard to standard rent could be raised also by a reply to the notice. If that was not the correct view and there was no other circumstance which took the case out of section 12(3)(a), in our view, the learned Assistant Judge was in error in holding that the plaintiff was not entitled to a decree for eviction. Consequently the petition will have to be allowed. The Judgment of the learned Assistant Judge and the judgment of the Joint Civil Judge (Junior Division), declining the plaintiff a decree for possession will have to be set aside and the plaintiff will be entitled to a decree for possession in addition to the decree for Rs. 1547.44 passed by the Civil Judge, (Junior Division), Kolhapur. The plaintiff will also be entitled to mesne profits from the date of the decree. The plaintiff will entitled to the cost of the suit and the appeal. There will, however, be no order as to costs of this petition.

42. So far as the other petition, being Special Civil Application No. 1866 of 1977, is concerned, it is also difficult to resist the conclusion that the claim of the plaintiff fell within the provisions of section 12(3)(a) of the Rent Act because the tenant had neither paid the amount of arrears of rent nor filed an application for fixation of standard rent under section 11(3) with Explanation I to 12. Even otherwise, the view taken by the Appeal Court that the provisions of section 12(3)(b) were also not complied with appeared to be correct because the finding is that the tenant had not paid rent regularly as required. There is thus no reason to interfere with the decree passed by the learned District Judge in favour of the landlord. Special Civil Application No. 1866 of 1977 must, therefore, stand dismissed. Rule will stand discharged. However, in the circumstances of the case we make no order as to costs of this petition.

S.C.A. No. 1812/1977 allowed. S.C.A. No. 1866/1977 dismissed.


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