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Prem Sheel Malhan Vs. Shanti Sharma - Court Judgment

LegalCrystal Citation
SubjectTenancy
CourtDelhi High Court
Decided On
Case NumberSecond Appeal No. 363 of 1969
Judge
Reported inILR1971Delhi155
ActsDelhi Rent Control Act, 1958 - Sections 9 and 10
AppellantPrem Sheel Malhan
RespondentShanti Sharma
Advocates: Jitendra Lal,; Janendra Lal and; C.L. Sachdev, Advs
Cases ReferredM.M. Chawla v. J.S. Selhi
Excerpt:
(i) delhi rent control act (1958) - sections 9 & 10-- scope of--fixation of interim rent under section 10--finding as to existence of relationship of landlord & tenant necessary before order under section 10 can be made.; that the order fixing the interim rent under section 10 has to be passed before the decision of the application for the fixation of standard rent on merits, but after the assumption of jurisdiction by the controller. the finding as to the existence of the relationship of landlord and tenant between the parties has to be, given by the controller before assuming jurisdiction to entertain the application under section 9. for, no order under section 10 can be passed by the controller except on an application under section 9, and no application under section 9 can be..........of the delhi rent control act, 1958 (hereinafter called the act) which runs as under : fixation of interim rent.-if an application for fixing the standard rent or for determining the lawful increase of such rent is made under section 9, the controller shall as expeditiously as possible, make an order specifying the amount of the rent or the lawful increase to be paid by the tenant to the landlord pending final decision on the application and shall appoint the date from which the rent or lawful increase so specified shall be deemed to have effect.'(2) the respondent filed a petition under section 9 of the act for the fixation of standard rent of the premises belonging to the appellant and occupied by the respondent. admittedly the respondent was to pay rs. 300 per month plus rs. 8.00 as.....
Judgment:

V.S. Deshpande, J.

(1) The decision of this case turns on the precise meaning of section 10 of the Delhi Rent Control Act, 1958 (hereinafter called the Act) which runs as under :

Fixation of interim rent.-If an application for fixing the standard rent or for determining the lawful increase of such rent is made under section 9, the Controller shall as expeditiously as possible, make an order specifying the amount of the rent or the lawful increase to be paid by the tenant to the landlord pending final decision on the application and shall appoint the date from which the rent or lawful increase so specified shall be deemed to have effect.'

(2) The respondent filed a petition under section 9 of the Act for the fixation of standard rent of the premises belonging to the appellant and occupied by the respondent. Admittedly the respondent was to pay Rs. 300 per month plus Rs. 8.00 as water charges for the occupation of the premises. The respondent pleaded that this payment was by way of rent and that it is excessive and the amount should be reduced and a standard rent should be fixed. The defense by the appellant was two-fold. Firstly, as a preliminary objection, it was pleaded that there was no relationship of landlord and tenant between the parties. The respondent was only a licensee of the appellant. Secondly, if such relationship was established then the amount of Rs. 300.00 per month was a reasonable rent for the premises and should not be reduced in fixing the standard rent.

(3) The Controller and the Rent Control Tribunal were both of the view that they had to fix an interim rent payable by the respondent to the appellant under section 10 of the Act on a prima facie view of the relationship between the parties without having to decide it finally. They, thereforee, fixed interim rent under section 10 at Rs. 100.00 per month holding that prima-facie the relationship between the parties was that of landlord and tenant. The Controller then proceeded to take evidence of both the parties with a view to decide finally both the issues nanely, (1) whether the respondent was a tenant or a mere licensee, and (2) if he was a tenant, then at what amount should the standard rent be fixed. The case is still pending with the Controller. In the meanwhile, an appeal was filed by the present appellant against the order of the Controller fixing the interim rent. But the Tribunal dismissed the appeal. Hence this second appeal against the fixation of interim rent at Rs. 100.00.

(4) The learned counsel for the appellant Shri Jindra Lal urged two grounds in support of the second appeal, namely:-

(1)The Controller had no jurisdiction to fix the interim rent under section 10 without finally deciding whether the respondent was a tenant of the appellant; and (2) Under section 10, interim rent cannot be fixed below the agreed contractual rent.

(5) Let us consider these two grounds in the order in which they were urged.

(6) Ground No. 1 Section 10 opens with the words 'if an application for fixing the standard rent or .for determining the lawful increase of such rent is made under section 9', These words show that the order under section 10 can be passed only on an application made under section 9. The opening words of section 9 are as follows : 'The Controller shall. on an application made to him in this behalf, either by the landlord or by the tenant'. It is only. thereforee, an application either by the landlord or by the tenant which is contemplated by section 9. In other words, the relationship between the parties must be that of a landlord and tenant before an application could be made under section 9. It is arguable that sub-section (4) of section 50 of the Act leaves it open to the civil court to determine finally the relationship of landlord and tenant between the parties. This seems to be the meaning of the words 'any question as to the person or persons who are entitled to receive the rent of such premises' used in section 50(4) regarding which the jurisdiction of the civil court is preserved. Subject, however, to this provision, it is the duty .of the Controller to find out whether the application under section 9 before him has been made by a tenant or a landlord. Unless the Controller is satisfied that it is made by one of such persons, the Controller would not be competent to entertain the application,. The, Act does not make a provision for a decision by the Controller on the existence of such relationship. The various provisions of the Act become applicable only when the relationship of landlord and tenant is either assumed or is established. On this view the existence of such relationship becomes a condition precedent to the assumption of jurisdiction by the Controller. It is, thereforee, the duty of the Controller to first be satisfied that such a relationship exists before he proceeds to entertain and decide the application for the fixation of standard rent filed under section 9 or an application for eviction filed under the proviso to section 14(1). This is so even if the finding of the Controller may be challengeable in a civil court. (Mrs. D. David v. Miss R. Mukha,1970 All Ind R C J 579(1), referred to with approval by the Division Bench in C.R. Abrol v. Administrator under the Slum Areas, I.L.R. (1970) 1 Del 768 (2).

(7) Shri Sachdeva, learned counsel for the respondent argued that under section 10 the Controller has to make an order fixing an interim rent 'as expeditiously as possible ....pending final decision on the application'. According to him these words would indicate that the final decision regarding jurisdiction could be postponed by the Controller, but the order fixing the interim rent has to be passed immediately after the application under section 9 comes before him. In my view, the words 'pending final decision on the application' indicate the final decision on the application for the fixation of standard rent. This decision is on the merits of the case. As distinguished from the merits, however, the question of the jurisdiction of the Controller is in the nature of a preliminary issue which has to be decided as early as possible by the Controller. It may be a matter of convenience for the Controller in a particular case whether the issue of jurisdiction is decided as a preliminary issue or whether it is decided along with the other issues on the merits of the case. But whatever course is adopted by the Controller, the distinction between the assumption of jurisdiction and the decision of the merits of the case must be preserved. The order fixing the interim rent under section 10 has to be passed before the decision of the application for the fixation of standard rent on merits but after the assumption of jurisdiction by the Controller. The finding as to the existence of the relationship of landlord and tenant between the parties has to be given by the Controller before assuming jurisdiction to entertain the application under section 9. For, no order under section 10 can be passed by the Controller except on an application under section 9 and no application under section 9 can be made by a person who is not a landlord or a tenant. The conclusion is, thereforee, inescapable that an order under section 10 cannot be passed before the Controller finds that the parties are landlord and tenant of each other.

(8) The Controller and the Rent Control Tribunal were under the impression that only a prima fade view or finding about the relationship of the parties is sufficient for the assumption of jurisdiction by the Controller in passing the order under section 10. Perhaps a subtle fallacy underlies this impression. A court or a tribunal entertains a suit or an application on a prima fade view that it has jurisdiction only when the suit or application has to be entertained solely looking to the allegations made in the plaint or the application. But after this stage has passed and the opposite party denies the allegations giving jurisdiction to the court or the tribunal, the question of jurisdiction has to be decided by the court or the tribunal. It may be decided either as a preliminary issue or along with the rest of the issues. But if any particular action can be taken by the court or the tribunal only on the footing that the court or the tribunal has jurisdiction to take such action, then the court or the tribunal .cannot reason to itself that it has already entertained the suit or the application on a prima facie view of the jurisdiction and, thereforee, it can take further action also on the same footing. There is an essential difference between the initial entertainment of a suit or an application with a view to decide the question of jurisdiction and the taking of subsequent action after the question of jurisdiction is decided. The former can be done on a prima facie view but the latter can be done only after the question of jurisdiction is determined. thereforee, the words 'as expeditiously as possible' in section 10 mean that the order can be passed immediately if the jurisdiction of the Controller is not disputed. But they do not mean that the order should be passed immediately even if the jurisdiction is disputed. If the jurisdiction is disputed, the Controller must decide the question of jurisdiction and it is only when the Controller finds that he has jurisdiction that the order under section 10 can be passed by him. In the present case, the order under section 10 was passed before the question of jurisdiction was finally decided and, thereforee, the order is not sustainable and has to be set aside for this reason alone.

(9) The above conclusion is reinforced by the analogy of section 15(1).

(10) The Controller has to order the payment of rent and the arrears of rent there under without waiting for the final decision of the eviction application (V. N. Vasudeva v. Seth Kirorimal Luhariwala, : [1964]6SCR181 . This does not, however, entitle the Controller to take the socalled prima facie view of the liability of the tenant to pay the arrears of rent and pass an order against him to pay such arrears to the landlords. On the contrary, the Controller must first decide the amount of arrears due from the tenant to the landlord before making the order under section 15(1) (M.M. Chawlav. J. S. Sethi, : [1970]2SCR390 . Similarly, the Controller must first decide that the landlord and tenant relationship exists between the parties before passing an order under section 10 of the Act.

(11) Ground No. 2 Section 10 does not lay down any criteria about the amount at which the interim rent has to be fixed by the Controller there under. The reason is that the criteria for the fixation of standard rent are laid down in section 6 and in section 9(4) of the Act. It is obvious, thereforee, that the Controller would have regard to those criteria in fixing the interim rent. Naturally, the interim rent has to be fixed by the Controller before those criteria are finally decided by him. For, a final decision as to the criteria will result in the fixation of the standard rent itself. This is why the fixation of the interim rent has to precede the final decision of these criteria.

(12) Shri Jindra Lal for the appellant advanced an ingenious argument that an interim rent under section 10 cannot be fixed at an amount lower than the admitted contractual rent. He pointed out that under 15(3) of the Act (which seems to be the, only other provision in the Act relating to the fixation of an interim rent it is only when there is dispute as to the amount of rent payable by the tenant (which includes a dispute as to the rate of the rent) that the Controller can fix interim rent at a figure below the contractual rent alleged by the land the figure alleged by the tenant. On the other hand, ^^ under section 15(1) the Controller has to order the payment of rent at the rate at which it was last paid. Shri Jindra Lal argues that in the present case, there is no dispute as to the contractual rent or license fee and. thereforee, section 10 is the converse of section 15(3) and is analogous to section 15(1) and, thereforee, it is only the contractual rent which can be fixed as the interim rent under section 10. This argument ignores the essential difference between section 10 on the one hand and sections 15(1) and 15(3) on the other hand. Under sections 15(1) and 15(3) there is no plea by the landlord or the tenant for the enhancement or for the reduction of the contractual rent. Both of them are agreed that it is only the contractual rent which is payable by the tenant to the landlord. thereforee, section 15 does not give any power to the Controller to enhance or reduce the contractual rent. For, no such action is called for. On the contrary, the essence of the application under section 9 for the fixation of standard rent is that the contractual rent should be either enhanced or reduced. The object of section 10 is to give immediate relief to the applicant pending the final fixation of the amount of standard rent. This is why the Centered has been given the power to enhance the contractual rent at the instance of the landlord or to reduce the same at the instance of the tenant under section 10 as an interim measure in the same way as is to be done under section 9 as a permanent measure. thereforee, section 10 is neither the converse of section 15(3) nor is it analogous to section 15(1) in this particular respect.

(13) Shri Jindra Lal next argued, relying on the decision of T.V.R. Tatachari J. in Shri Hari Shanker Saxena v. Shrimati Sarla Devi, 1970 R.C.R. 36(5), that the fixation of interim rent under section 10 has no effect in law on the contractual rent. Even if the interim rent fixed under section 10 is lower than the contractual rent, the landlord would be entitled to recover the whole of the contractual rent from the tenant in a civil Court. I am unable to agree. Section 10 expressly authorizes the Controller to make an order specifying the amount of the rent to be paid by the tenant to the landlord pending final decision. Sub-section (1) of section 50 excludes the jurisdiction of the civil Court with respect to any matter 'which the Controller is empowered by or under this Act to decide'. The amount of rent payable by the tenant to the landlord pending the final decision as to the fixation of standard rent is to be fixed by the Controller alone. It is a matter within the exclusive jurisdiction of the Controller. The order passed by the Controller under section 10 is binding on the landlord and the tenant and subject to the result of the appeals under the Act, such order acts as rest judicata between the parties. The civil Court cannot, thereforee, ignore such an order but would be bound by it so long as the order is operative. The landlord cannot, thereforee, recover the rent in excess of the interim rent fixed under section 10 for the period for which the order under section 10 is operative. If the rent finally fixed as standard rent is higher or lower than the interim rent fixed under section 10, then the landlord or the tenant as the case may be would be free to recover the difference between the interim rent and the standard rent from each other. Section 15(1) of the Limitation Act provides that in computing the period of limitation for any suit the institution of which has been stayed by injunction or order, the time of the continuance of the injunction or order shall be excluded. The order under section 10 of the Act has the effect of preventing the landlord or the tenant as the case may be from suing each other for the recovery or refund of the excess rent. They can, thereforee, claim the benefit of section 15(1) of the Limitation Act when filing a suit in the civil Court for the recovery or refund of such excess rent. In Hari Shanker's case the claim was in respect of rent prior to the fixation of interim rent except in respect of the period of two months from March to May, 1960. But the question whether contractual rent was payable for those two months inspire of the fixation of interim rent under section 10 and whether the benefit of section 15(1) of the Limitation Act was available was neither raised in argument nor decided by his Lordship. The ratio of the decision does not, thereforee, support the argument of Shri Jindra Lal.

(14) For, the order under section 10 has the effect of modifying the contract between the parties pending the fixation of the standard rent in the same way as the order fixing the standard rent finally modifies the contractual rent. The decision of the Supreme Court in M.M. Chawla v. J.S. Selhi, referred to above, that the contractual rent is legally recoverable unless and until the standard rent is fixed establishes the proposition that the contractual rent is finally modified by the fixation of the standard rent. The reason is that the Controller has been given the power under the Act to do so. Similarly, the Controller has been given the power under section 10 to modify the contractual rent pending final decision on the application for the fixation of standard rent. On the same reasoning, thereforee, the order of the Controller under section 10 must have the effect of modifying the contractual rent pending the final decision on the application for the fixation of standard rent. Just as sections 6 and 9(4) empower the Controller to fix the standard rent notwithstanding the contractual rent similarly section 10 empowers the Controller to fix an interim rent pending the final fixation of the standard rent. Both these results flow from the powers given to the Controller by the provisions of the Act. If the power exercised under sections 6 and 9(4) affects the contractual rent, I do not see why the power exercised under section 10 should not also affect the contractual rent. Similarly, the interim rent fixed under section 15(3) also supersedes the alleged contractual rent (if any) so long as the order under section 15(3) is operative. All these provisions, thereforee, show that the Controller has the power under section 10 (just as he has the power under section 6, 9(4) and 15(3) ) to fix a rent different from the contractual rent or alleged contractual rent. This contention, thereforee, fails.

(15) The order passed by the Controller under section 10 fixing the interim rent and confirmed by the Tribunal is set aside and the Controller is directed to decide both the questions, namely,

(1)whether the respondent is a tenant or licensee of the appellant, and (2) if she is a tenant, then what should be the standard rent. as expeditiously as possible, say within four weeks or so. It is understood that the respondent has already adduced her evidence on both these points and the Controller shall see that the appellant also does so expeditiously so that the final decision of the Controller on both the questions is given immediately thereafter. In the circumstances of the case, there will be no order as to costs.


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