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Mukundlal Agarwal Vs. Shankerlal Vishwanath Prasad - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtMadhya Pradesh High Court
Decided On
Case NumberMisc. Second Appeal No. 155 of 1964
Judge
Reported inAIR1965MP185; 1965MPLJ211
ActsMadhya Pradesh Accommodation Control Act, 1961 - Sections 2, 3, 5, 7, 8, 10(1), 10(2), 31, 31(1) and 32; Code of Civil Procedure (CPC) , 1908 - Sections 100 - Order 47, Rule 1
AppellantMukundlal Agarwal
RespondentShankerlal Vishwanath Prasad
Appellant AdvocateR.S. Dabir and ;R.P. Agarwal, Advs.
Respondent AdvocateY.S. Dharmadhikari and ;M.V. Tamaskar, Advs.
DispositionAppeal allowed
Cases ReferredCohen v. S. E. Rly
Excerpt:
- - 2. the rent controlling authority found that the landlord had not kept the accommodation in good and 'tenantable repairs';that the rent as shown in the municipal assessment register for the year 1947-48 was rs. provided that the increase specified in paragraphs (a) and (b) shall be permissible only if the accommodation has been kept in good and tenant-able repairs; , rejected the contention that the paragraph in section 7, which follows clause 2(ii) and deals with 'increase of rent' governed clause (i) as well as clause (2) of section 7. he expressed the view that while sub-clauses (i) and (ii) of clause (2) laid down 'basic rent' in regard to the type of accommodation dealt with by those sub-clauses, the first clause did not provide for any basic rent at all but fixed the.....dixit, c.j. 1. this appeal has come up before us on a reference made by one of us, and arises out of proceedings initiated by the appellant mukundlal under section 10 of the madhya pradesh accommodation control act, 1961, (hereinafter called the act), for fixation of 'standard rent' of certain shop premises situated in sarafa ward, jabalpur, in the occupation of the respondent shankarlal as mukundlal's tenant.2. the rent controlling authority found that the landlord had not kept the accommodation in good and 'tenantable repairs'; that the rent as shown in the municipal assessment register for the year 1947-48 was rs. 90/- per month; and that on 7th december 1948 fair rent had been fixed at rupees 70/- per month in respect of the accommodation by the competent authority under the c. p. and.....
Judgment:

Dixit, C.J.

1. This appeal has come up before us on a reference made by one of us, and arises out of proceedings initiated by the appellant Mukundlal under Section 10 of the Madhya Pradesh Accommodation Control Act, 1961, (hereinafter called the Act), for fixation of 'standard rent' of certain shop premises situated in Sarafa Ward, Jabalpur, in the occupation of the respondent Shankarlal as Mukundlal's tenant.

2. The Rent Controlling Authority found that the landlord had not kept the accommodation in good and 'tenantable repairs'; that the rent as shown in the municipal assessment register for the year 1947-48 was Rs. 90/- per month; and that on 7th December 1948 fair rent had been fixed at Rupees 70/- per month in respect of the accommodation by the competent authority under the C. P. and Berar Regulation of Letting of Accommodation Act, 1946, which was then in force in Jabalpur. The authority took the view that in fixing 'standard rent', the provisions of Section 7 of the Act had to be given due consideration; that the matter was governed by Section 7(i) of the Act; and that as reasonable rent in respect of the accommodation had been fixed in 1948 at Rs. 70/- the standard rent under the Act should be fixed at Rs. 70/- per month. The landlord then preferred an appeal before the District Judge under Section 31 of the Act.

The learned District Judge first dismissed the appeal by an order dated 19th March 1964 which stated that in view of the decision of this Court in Mahabir v. Jotumal, 1964 MPLJ (Notes) 46: MSA No. 107 of 1963 dated 29-11-1963 learned counsel appearing for the landlord Mukundlal did not wish to press the appeal. Thereafter an application for review of that order was filed by the landlord. The review was founded on the ground that at the time of the hearing of the appeal what the landlord's counsel stated was not that he did not wish to press the appeal but that it was that in view of the decision of this Court referred to above the learned District Judge, who was bound to follow that decision, had no other alternative but to dismiss the appeal, so as to enable the landlord to canvass again in this Court the question decided in the case of Mahabir, 1964 MPLJ (Notes) 46 (supra). The review application was ultimately granted and on 3lst August 1964 the learned District Judge following Mahabir's case, 1964 MPLJ (Notes) 46 made a fresh order dismissing Mukundlal's appeal holding that under Section 7 (i) of the Act the reasonable rent of Rs. 70/- per month fixed under the C. P. and Berar Regulation of Letting of Accommodation Act, 1946, would automatically become the 'standard rent' of the accommodation.

The landlord then preferred a second appeal in this Court under Section 32 of the Act. When that appeal first came for hearing before one of us (the Chief Justice), Shvi Dabir, learned counsel for the appellant Mukundlal, assailed the correctness of the construction put on Section 7 of the Act in Mahabir's case, 1964 MPLJ (Notes) 46 (supra). As the question of the meaning and effect of Section 7 of the Act frequently arises in proceedings for fixation of standard rent under the Act and as it is a substantial one not free from difficulty, it was thought necessary to have the question of construction of Section 7 of the Act decided by a larger Bench rather than by a Judge sitting singly.

3. Before dealing with the merits of the appeal, it is necessary to dispose of the preliminary objections raised by the learned counsel for the respondent to the maintainability and competency of this appeal. It was first said that Section 32 of the Act, under which this appeal had been preferred, did not indicate this Court as the forum of appeal: and that in fact the Act nowhere provided as to where a second appeal would lie. The question as to the forum of second appeal admits of an easy answer.

Under Section 31, an appeal lies against an order of the Rent Controlling Authority to the Court of District Judge and not to the District Judge as a persona designata. This is clear from the fact that though Section 31(i) in the beginning provides that 'An Appeal shall lie.....to the District Judge or an Additional District Judge having territorial jurisdiction' it concludes by saying that 'that decision of the appellate court shall be final'. The use of the words 'appellate court' leaves no doubt that an appeal under Section 31 lies to the Court of District Judge. If an appeal lies to the court of District Judge, then it follows, on the basis of the principles laid down in National Sewing Thread Co. Ltd. v. James Chadwick and Bros, Ltd., AIR 1953 SC 357; National Telephone Co. Ltd. v. Postmaster-General, 1913 AC 546 and Adaikappa v. Chandrasekhara, AIR 1948 PC 12 that the Court of District Judge is appealed to as one of the ordinary courts with regard to whoso procedure, orders and decrees the ordinary rules of the Code of Civil Procedure apply and that any general right of appeal under the Code of Civil Procedure from its decision likewise attaches. An appeal under the Civil Procedure Code from a decision of the Court of District Judge lies to the High Court. Therefore, an appeal against an order passed in first appeal under Section 31 lies to this Court and nowhere else.

Learned counsel for the respondent staled that if it were to be taken that an order made in first appeal under Section 31 was appealable to this Court under the Code of Civil Procedure, then Section 32 of the Act would become a superfluity. We are unable to accept this argument which overlooks the fact that what Section 32 of the Act does is to lay down the grounds on which a second appeal would be competent, and to that extent modifies Section 100 of the Code of Civil Procedure. The grounds enumerated in Section 32 of the Act arc different from those stated in Section 100 C. P, C, Clauses (ii) and (iii) of Section 32 differ from Clauses (b) and (c) of Section 100(1) of the Code. The effect of combined reading of Section 32 of the Act and Section 100 of the Code is that a second appeal against an order passed in first appeal under Section 31 lies to the High Court, not on the grounds specified in Section 100 of the Code but on any of the grounds mentioned in Section 32 of the Act.

4. The other preliminary objection raised on behalf of the respondent was that this appeal was preferred on 7th October 1964 and the order of the District Judge dismissing the appellant's first appeal was passed on 19th March 1964, and that, therefore, this appeal was barred by time. The flaw in the argument lies in assuming that the present appeal has been preferred against the order dated 19th March 1964. That order was superseded when the learned District Judge allowed the appellant's review application, heard the first appeal afresh and passed on 31st August 1964 a fresh order dismissing the appeal. This appeal is not against the order dated 19th March 1964 passed by the District Judge but against the order passed by him on 31st August 1964. The memorandum of this appeal itself says that this appeal is against the order passed on 31st August 1964 by the District Judge Jabalpur.

If any authority is needed to support this view, it is sufficient to refer to Bhawani Prasad v. Laxmibai, AIR 1919 Nag 78: 15 Nag LR 65 where the analysis made by Jenkins, C.J. in Sha Vadilal v. Fulchand, ILR 30 Bom 56 about the various stages through which an application for review passes was referred to, and it was held that an application for review can be continued after the filing of an appeal from a decree and that if the review succeeds and a new decree is framed, the decree under appeal is superseded, and an appeal, therefore, from that decree becomes incompetent and cannot be heard and the appeal that is competent is the one filed against the new decree.

5. Turning to the merits of the appeal, the mailer at issue before its is whether in relation to that accommodation in respect of which reasonable annual rent or fair rent has been fixed by the competent authority under the M. P. Accommodation Control Act, 1955, which was repealed by the Act of 1961, or prior to the commencement of the repealed Act, under the enactment for the time being in force, 'standard rent' under the Act of 1961 can be fixed. The question turns on the construction principally of Section 7 of the Act, which so far as relevant here, is as follows:

'7. Standard rent:--'Standard rent' in relation to any accommodation means-

(1) Where reasonable annual rent or fair rent has been fixed by a competent authority under the repealed Act or prior to the commencement of the repealed Act, as the case may be, by a competent authority under the enactment for the time being in force, such reasonable annual rent or fair rent;

(2)(i) Where the accommodation was let out on or before the 1st day of January 1948, and the reasonable annual rent or fair rent has not been so fixed, the rent of that accommodation as shown in the Municipal Assessment Register or as was realised on the 1st day of January 1948, whichever is less; or

(ii) Where the accommodation was not let out on or before the 1st day of January 1948, the rent of that accommodation as shown in the Municipal Assessment Register or as could be realised on the 1st day of January 1948, whichever is less; Increased-

(a) in the case of a residential accommodation and accommodation used for educational purposes, by thirty-five per cent of such rent;

(b) in the case of other accommodation, by seventy per cent of such rent; and

(c) in case the tenant is not liable to pay the municipal tax and there has been any increase in municipal tax subsequent to 1st day of January 1948, by such amount as would bear the same proportion to the rent as the increase bears to the amount of tax;

Provided that the increase specified in paragraphs (a) and (b) shall be permissible only if the accommodation has been kept in good and tenant-able repairs; ** ** ** **'

Clause (3) of Section 7 proceeds to describe 'standard rent' in relation to accommodation not falling under Clause (i) or Clause (2) reproduced above.

6. In Mahabir's case, 1964 MPLJ (Notes) 46 Shiv Dayal J., rejected the contention that the paragraph In Section 7, which follows Clause 2(ii) and deals with 'increase of rent' governed Clause (i) as well as Clause (2) of Section 7. He expressed the view that while Sub-clauses (i) and (ii) of Clause (2) laid down 'basic rent' in regard to the type of accommodation dealt with by those Sub-clauses, the first clause did not provide for any basic rent at all but fixed the reasonable annual rent or fair rent determined by the competent authority under the repealed Act or under the enactment for the time being in force prior to the commencement of the repealed Act itself, as 'standard rent' under the Act; that the 'increase' clause occurring in Section 7 pre-supposed a 'basic rent'; and that consequently there could be no question of the 'increase' clause being applicable to Section 7(i) of the Act.

According to the learned Judge, the construction put by him was the only possible construction in view of the expression 'such reasonable annual rent or fair rent' occurring at the end of Clause (1) and that construction did not in any way result in discrimination between the landlords who were owners of accommodation of the type falling under Clause (i) of Section 7 and those landlords who were owners of accommodation described in Clause (2).

7. Shri Dabir, learned counsel for the appellant, disputed the construction put on Section 7 of the Act in Mahabir's case, 1964 MPLJ (Notes) 46 (supra), his point being that the provision in Section 7 beginning with the word 'increased' and ending with the proviso was not in any sense a qualifying provision applying to the immediately preceding Clause (2) or Sub-clause (ii) thereof but that it was a substantive provision referring to all the proceeding clauses and a part of each of the clauses; and that having regard to the object of fixing of 'standard rent' under the Act, no absurdity or inconvenience or inequity would follow from holding that the 'increase' clause applied to Clause (i) as well as to Clause (2) of Section 7. Learned counsel sought to reinforce his argument by referring to Clause (3) of Section 7 dealing with 'standard rent' in relation to an accommodation not falling under Clause (i) or Clause (2), and said that even in regard to accommodation falling under Clause (3) the Act provided, for a certain percentage of increase.

In reply, Shri Dharmadhikari, learned counsel for the respondent-tenant, while supporting the view taken in Mahabir's case, 1964 MPLJ (Notes) 46 (supra), added that the application of the provision dealing with 'increase' to accommodation covered by Section 7(i) would place the landlords of accommodation falling under Clause (i) in a more advantageous position than the landlords of accommodation falling under other clause and would defeat altogether the object of fixation of 'standard rent' which was to protect the tenants against rapacious landlords.

8. Before dealing with the question of construction of Section 7, reference should be made to the other material provisions of the Act. Section 2(h) defines 'standard rent' thus-

' 'Standard rent' in relation to any accommodation means standard rent referred to in Section 7 or where the standard rent has been increased under Section 8, such increased rent:'

Section 5 of the Act says-

'5(i) No tenant shall, notwithstanding any agreement to the contrary, be liable to pay to his landlord for the occupation of any accommodation any amount in excess of the standard rent of the accommodation.

(2) Any agreement for the payment of rent in excess of the standard rent shall be construed as if it were an agreement for the payment of the standard rent only.'

Section 8 enables the landlord to increase the 'standard rent' by a certain percentage in the circumstances mentioned in that provision. Section 10 deals with the fixation of standard rent. The relevant provisions of that section are as follows:--

'10. (i) The Rent Controlling Authority shall, on an application made to it in this behalf, either by the landlord or by the tenant, in the prescribed manner, fix in respect pf any accommodation-

(i) the standard rent in accordance with the provisions of Section 7; or

(ii) the increase, if any, referred to in Section 8, (2) In fixing the standard rent of any accommodation or the lawful increase thereof, the Rent Controlling Authority shall fix an amount which appears to it to be reasonable having regard to the provisions of Section 7 or Section 8 and the circumstances of the ease.

(3) ** ** ** (4) Where for any reason it is not possible to determine the standard rent of any accommodation on the principles sat forth under Section 7, the Rent Controlling Authority may fix such rent as would be reasonable having regard to the situation, locality and condition of the accommodation and the amenities provided therein and where there are similar or nearly similar accommodations in the locality, having regard also to the standard rent payable in respect of such accommodations. ** ** ** **'

9. Now, the construction of Section 7 of the Act must be according to the intention as expressed by the words used not only in that section but in other provisions of the Act as well. The cardinal rule for the construction of a statute is that it should be construed according to the intention expressed in the statute itself; and in order to understand the words the subject-matter with respect to which they are used, and the object in view, must be borne in mind.

Further, as Lord Goddard C.J. has said in Barnes v. Jarvis, 1953-1 WLR 649. 'A certain amount of common sense must be applied in construing statutes'. Consequently, when construing a statute the object for its enactment should be kept in mind and the statute should be construed with reference to its intended scope and purpose, and in order to carry out this purpose rather than to defeat it. Of course, if the language of the statute is precise and unambiguous and its meaning is clear, then the statute must be given the expressed meaning without deviation.

It is evident from the provisions referred to above and other provisions of the Act that the object and intention of the Act is to control 'rent' and to prevent landlords from profiteering in rent and protect the tenants from being compelled to pay more than a fair rent At the same time the Act is not intended to operate in such a way as to penalise the landlords by disregarding altogether the rise in rent along with the prodigious rise in prices all these years since 1940. Though Sections 2(h), 5, 7 and 10 are not happily worded and there is much confusion in them as regards the use of the term 'standard rent' and the word 'means', there can be no doubt that their aim in to control rent by providing that no tenant shall be liable to pay to his landlord for any accommodation any amount in excess of the 'standard rent' of the accommodation which, as defined in Section 2(h), means 'standard rent referred to in Section 7 or where the standard rent has been increased under Section 8, such increased rent', by laying down the principles in Sections 7 and 8 according to which 'standard rent' is to be determined and by giving to the Rent Controlling Authority the power of fixing reasonable rent in respect of any accommodation having regard to the provisions of Section 7 or Section 8 and the circumstances of the case.

The direction in Sub-section (2) of Section 10 that 'the Rent Controlling Authority shall fix an amount which appears to it to be reasonable having regard to the provisions of Section 7 or Section 8 and the circumstances of the case' is important and significant. It shows that what the Rent Controlling Authority fixes under Sub-sections (i) and (2) of Section 10 is not the 'standard rent' spoken of In Section 2(h) or Section 7 but 'reasonable rent'. The effect of the prohibition contained in Section 5 that rent in excess of 'standard rent' shall not be recoverable and of the direction referred to above in Sub-section (2) of Section 10 is that in fixing reasonable rent under Sub-sections (1) and (2) of Section 10, the Rent Controlling Authority must be guided by the principles as are contained in Sections 7 and 8 and the circumstances of the case, but that Authority is not bound to fix fair and equitable rent at the limit of the lawful 'standard rent' which can be exacted under Section 7 or Section 8. In other words, within the limits of the 'standard rent' computed in accordance with the principles laid down in Sections 7 and 8, the Rent Controlling Authority has discretion to fix a reasonable rent.

10. This being the nature of the power and discretion exercised by the Rent Controlling Authority under Section 10(1) and (2), it cannot be argued with any degree of force that Section 7 contains a definition of 'standard rent' in relation to the accommodation mentioned in the three clauses of that provision, and it is the 'standard rent' so defined which the Rent Controlling Authority has to fix as reasonable rent of the accommodation, or that any of the clauses of Section 7 clinches the matter of fixation of 'reasonable rent' under Sub-sections (1) and (2) of Section 10.

Section 7 no doubt begins by the expression 'Standard rent in relation to any accommodation means'. But notwithstanding the use of the word 'means', it cannot in the face of Section 10(2) be regarded as a definition of 'reasonable rent' which the Rent Controlling Authority is required to fix under Section 10(1) and (2). It merely sets forth the principles for determining the 'standard rent' of certain types of accommodation. Section 10(4) itself makes it clear that Section 7 sets forth the principles for determining 'standard rent' when it says in the very beginning 'Where for any reason it is not possible to determine the standard rent of any accommodation on the principles set forth under Section 7'. The principles are laid down under Section 7 by classifying the accommodation under different categories, by prescribing in relation to each type of accommodation a statutory datum-line of rent, and by increasing that rent by a certain percentage.

So far as Clauses (1) and (2) of Section 7 are concerned, the percentage to be added to the datum-line rent is given by the paragraph following Section 7(2)(ii) and beginning with the word 'Increased' and ending with the proviso. In the circumstances specified, and subject to the proviso, the datum-line rent has to be raised for arriving at the standard rent, which, as pointed out earlier, is the maximum rent which can be lawfully demanded in respect of an accommodation. It must be noted that the provision referred to above dealing with the increase of rent is not any qualifying provision as a part of Clause (2) of Section 7, but is contained in a separate paragraph by itself and is detached from Clause (2). Therefore, as a matter of ordinary construction, it cannot be regarded as applying only to Clause (2) and not to Clause (i). That provision placed as it is, and consistent with the evident purpose (which will be explained presently) of increasing the datum-line rent by certain percentage is equally applicable to Clause (2) as to Clause (i).

In this connection, it would be pertinent to refer to the decision in Cohen v. S. E. Rly,, 1877-2 Ex D 253 where the question of construction of Section 16 of the Regulation of Railways Act, 1868, came up for consideration. At the end of Section 16 of the said Act there was an enactment that 'the provisions of the Railway and Canal Traffic Act, 1854, so far as the same are applicable, shall extend to the steam vessels and to the traffic carried on thereby'. The argument was advanced that as these words stood at the end of and formed part of Section 16, and were not contained in a separate section by itself, they were confined to the subject-matter to which the previous parts of Section 16 related and that consequently the provisions of the Act of 1854 could not be applied to the whole of the Act of 1868. Rejecting this contention, Mellish L.J. said:--

'I am not aware that there is any such rule of construction of an Act of Parliament. If some absurdity or inconvenience followed from holding it to apply to the whole Act, it might be reasonable to confine the incorporation to clauses relating to some particular subject-matter, but if there is no inconvenience from holding that the incorporation includes Section 7 as well as the other sections, we ought to hold that it does. '

The above observations make it plain that in the present case the provision following Clause (2) with regard to 'increase' of rent, which is contained in a separate paragraph by itself, cannot merely because it follows Clause (2) be a fortiori confined to the subject-matter of that clause, Its applicability to both the clauses only carries out the purpose underlying the enhancement of the datum-line rent by a certain percentage.

11. With all respect to the learned Single Judge deciding the case of Mahabir, 1964 MPLJ (Notes) 46 (supra), we do not find ourselves in agreement with the view expressed by him that as Clause (i) of Section 7 did not prescribe any basic rent, there could be no question of percentage of increase on it, that the reasonable annual rent or fair rent already determined under the repealed Act or under other measures prior to the commencement of the repealed Act was itself the 'standard rent', and that the construction put by him was clinched by the use of the expression 'such reasonable annual rent or fair rent' in Clause (i) of Section 7.

In taking this view, the learned Single Judge did not consider the effect of Section 10 (2) of the Act and did not notice the fact that the reasonable rent fixed by the Rent Controlling Authority under Sub-sections (1) and (2) of Section 10 could not be equated with the 'standard rent' dealt with by Section 7. Clause (1) as well as Clause (2) of Section 7 both prescribe a statutory datum-line of rent. Whereas Clause (1) does this with reference to the rent fixed under the previous Act referred to in that clause and makes that rent as the sacrosanct datum, the other clause fixes the datum-line on the basis of rent as was realised on 1st day of January, 1948 or as could be realised on that date and on rent as shown in the municipal assessment register. That being so, the applicability of the provision with regard to increase of rent to Clause (1) cannot be ruled out on the ground that the said clause does not lay down any 'basic rent'.

Nothing turns on the use of the word 'means' in Section 7. The provisions of Section 10 (2) of the Act leave no room for the argument that the reasonable annual rent or fair rent in relation to any accommodation determined under the repealed Act or, prior to the commencement of the repealed Act, under any enactment for the time being in force, is in itself the reasonable rent that the Rent Controlling Authority is required to fix under Section 10 (1) and (2). Nothing also turns on the expression 'such reasonable annual rent or fair rent' to be found at the end of Clause (1) of Section 7. This 'such reasonable annual rent or fair rent' means the reasonable annual rent or fair rent fixed by the competent authority under the repealed Act or, prior to its commencement, under any enactment for the time being in force, which has been made the datum-line of rent. It does not mean 'reasonable rent' which the Rent Controlling Authority is required to fix under Section 10 (1) and (2).

12. The argument of the learned counsel for the respondent-tenant that as in the fixation of reasonable annual rent or fair rent in relation to any accommodation under the repealed Act, namely, the M. P. Accommodation Control Act, 1955, or under any Act which was in force for the time being prior to the commencement of the repealed Act, an increase of rent on lines similar to those to be found in the provision dealing with 'increase' of rent in Section 7 of the Act was allowed, the applicability of the 'increase' provision to Section 7 (1) would result in giving the landlords of accommodations of the type specified in Clause (1) the benefit of increase of rent twice, is altogether fallacious.

It is true that the 'reasonable annual rent' at defined in Section 3 (e) of the Act of 1955 allowed for an increase of rent by thirty-five per cent in the case of residential accommodation and by seventy per cent in the case of non-residential accommodation. But that increase was with reference to the basic rent of the accommodation as was shown in the municipal assessment register or as was realised or could be realised on 1st January, 1941. Thus that provision allowed an increase of thirty-five per cent and seventy per cent in the case of residential and non-residential accommodations, respectively, over the level of rent prevailing on 1st January, 1941 and the entry in the municipal assessment register was taken as a fair measure of the current rent. The various rent control measures, which were in force before the commencement of the repealed Act, allowed an increase of rent taking the rent prevailing on a date even anterior to 1st January, 1941 as the basic rent.

The increase that is provided by the 'increase' provision under consideration is, as is obvious from Clause (2) itself, with reference to the rent which was realised or which could be realised on 1st January, 1948, taking the rent shown in the municipal assessment register as a fair indication of the rent which was realised or which could be realised if the entry in the municipal assessment register showed a rent lower than the one which was realised or which could be realised. The 'increase' provision only attempts to reach, at a point of time long after 1st January, 1948, a fair and equitable rent from the point of view of the landlord on the basic of the current rent prevailing on that date, and thus intends to compensate the landlord for the loss in rent as a result of continuous rise in prices and rents.

Now it cannot be gainsaid that there has been a prodigious rise in the level of prices of all things and commodities as also in rent during the years 1940 to 1948, and the rise is continuing. It follows, therefore, that the reasonable or fair rent fixed in regard to an accommodation under the repealed Act or any of the earlier statutes with reference to the rent prevailing in 1940 or 1941 can have no correspondence with the general level of rent of residential or non-residential accommodation prevailing in 1948 or in subsequent years. There can, therefore, be no warrant for the assumption that the rent fixed in relation to any accommodation under the repealed Act or any law for the time being in force prior to the commencement of the repealed Act, was more than thirty-five per cent or seventy per cent, as the case may be, higher than the rent which could have been realised for the accommodation on 1st January, 1948 if there had been no fixation of rent in regard to it. For, it is only on this supposition that the applicability of the 'increase' provision in Section 7 to Clause (1) thereof can be ruled out. The rent of the accommodation in question in the present case was fixed in 1948 under the C. P. and Berar Regulation of Letting of Accommodation Act, 1946, with reference to its rent as prevailing in the circumstances then existing after allowing for a certain increase. It is legitimate to think that if rent in respect of that accommodation had not been so fixed, then on 1st January, 1948 it would have been possible to realise for that accommodation rent equal to, if not higher than, the rent fixed under the Act of 1946.

13. For all these reasons, our conclusion isthat the paragraph in Section 7 beginning with the word'Increased' and ending with the proviso applies toboth Clause (1) and Clause (2) of Section 7 of the Act,and the view expressed in Mahabir's case, 1964MPLJ (Notes) 46 (supra), that the said paragraph isconfined to Clause (2) only is not correct. Theresult is that this appeal is allowed, and the orderdated the 31st August, 1964 of the learned DistrictJudge, Jabalpur, dismissing the landlord's appealunder Section 31 of the Act following the decision inMahabir's case, 1964 MPLJ (Notes) 46 (supra), isset aside. The learned District Judge must nowhear and dispose of the appeal on merits. In thecircumstances of the case, we leave the parties tobear their own costs of this appeal.


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