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Krishna Devi Ganeriwala Vs. Dhan Raj Singh - Court Judgment

LegalCrystal Citation
SubjectTenancy
CourtDelhi High Court
Decided On
Case NumberSecond Appeal Nos. 40, 42 and 50 of 1969
Judge
Reported inILR1973Delhi1071; 1972RLR170
ActsDelhi Rent Control Act - Sections 6
AppellantKrishna Devi Ganeriwala;krishna Devi Ganeriwala;krishna Devi Ganeriwala
RespondentDhan Raj Singh;abmasha Singh;prithi Pal Singh
Advocates: Sultan Yar Khan and; M.L. Lonial, Advs
Excerpt:
.....degree as to how much improvements and alterations in an old existing building would constitute a newly constructed or reconstructed premises, but in any view of the matter, very substantial structural alterations and improvements must be made in the main structure of the building before it can claim to be newly constructed. however, a rough and ready guide of practical value may be found in the definition of erection of a building under section 331 of the delhi municipal corporation act which is well-understood by the landlords. in respect of premises governed by the delhi rent control act, it would be safe to infer that where three-fourths of the main structure has been reconstructed or where the roof and the main walls on three sided have been re-erected, it may constitute a new..........does not lead to the conclusion that because the premises are not the same they are necessarily newly constructed. the reference to newly constructed in section 6 partakes of the characteristics of its being a building or part of a building and, thereforee, the building or part of the building must be newly constructed. (3) in the coatext of section 6, i agree with the counsel for the appellant that construction would include re-construction and in legal effect, there is no difference between construction and re-construction for purposes of this act which is distinct from the definition of the expression contained in the delhi municipal corporation act. between the buildings which have been entirely constructed or re-constructed from the very foundations to the buildings which have.....
Judgment:

B.C. Misra, J.

(1) The appellant owned a big hall at Kashmere Gate, Delhi, which was built in 1924. In about 1963 it was renovated and by putting up partition walls it was converted into 23 shops and let out to respondents and others at Rs. 80 per month. Respondent sued for fixation of standard rent which was fixed at Rs. 45.00. The order was upheld in appeal and appellant filed second appeal in High Court claiming that the shops were a,new construction and were exempt from the fixation of standard rent U/S 6(2)(b) of the Rent Act and if not then standard rent should have been fixed U/S 6(1)(B)(2)(b) and not U/S 9(4) of the Act. After reciting S. 6(2)(b) and S. 7(I), the judgment proceeds ;

(2) The increase of rent permitted by section 7(1), is in excess of the standard rent as defined in section 6. The scheme of the section is that with respect to properties constructed and let out prior to 2nd June, 1944, the rate at which they were let out, would subject to the additions calculated according to the second schedule of the Act, constitute the standard rent, but if any rent has been determined under the previous Rent Acts of 1947 and 1952, an increase of certain percentage has been permitted. Section 6(1)(b) provides that in any other case the reasonable cost of construction and the market price of the land comprised in the premises on the date of the commencement of the construction would form the basis on which the rent would be calculated at a percentage provided in the statute. However, in respect of the premises that are constructed after 2nd June, 1951 but before 9th June, 1955 or after 9th June, 1955 the operation of the standard rent has been given a holiday, as is popularly known, for a specified period of 5 or 7 years. In this case the finding of the Additional Rent Controller as well as the Tribunal is that a large hall has been converted into 23 shops by putting up partition walls without any alteration in the roof or flooring or the main walls supporting the building. The newly let out shops are certainly not the same premises as each has been separately let for use and is distinct from the letting of the old building : See Sadhu Singh v. District Board, Gurdaspur 1962. P.L.R. 1 and M/s Sant Ram Des Raj v. Karam Chand 1962. P.L.R. 758. This, however, logically does not lead to the conclusion that because the premises are not the same they are necessarily newly constructed. The reference to newly constructed in section 6 partakes of the characteristics of its being a building or part of a building and, thereforee, the building or part of the building must be newly constructed.

(3) In the coatext of Section 6, I agree with the counsel for the appellant that construction would include re-construction and in legal effect, there is no difference between construction and re-construction for purposes of this Act which is distinct from the definition of the expression contained in the Delhi Municipal Corporation Act. Between the buildings which have been entirely constructed or re-constructed from the very foundations to the buildings which have merely been repaired or improved, there is a large variety of cases where structural alterations have been made or improvement or additions have been made, meriting increase in the standard rent under Section 7, but under what circumstances can it be called that a building is newly constructed Meggary in Rent Acts 10th Edition at page 114 has observed that if a house is subjected 10 substantial structural alteration, it becomes a new and separate dwelling house by reason of change of identity and then the new premises sheds all the attributes of the old. But to fall under this head, there must be something fundamental transforming the general structural character of the house as an entire entity ; the change must be more radical than mere improvements or structural alterations or mere functional change of making one dwelling into two. It has also been observed that the court must be astute to see that the landlord is not evading the restrictions upon increases of rent imposed by the statute by a small and possibly colourable alterations of the structure, or by a mere sub-division of the tenement. The House of Lords in Capital and Provincial Property Trust v. Rice 1952. AC. 142 observed on page 152 that the line of demarcation (between the premises which have changed their identity) has been plainly established ; there must have been some structural alterations before the dwelling can be said to change its identity and become a new entity. In the facts of the case Lord Porter observed that on the blocking of the connecting door a new flat came into existance which was different from the whole or part, but this was not found sufficient to establish the change of identity of the property. In an earlier decision Longford Property Company Ltd. v. Batten 1951. A.C. 223 Lord Radcliff observed on page 240, that two main causes must be responsible for change of identity-one is a physical change brought about by improvement or structural alteration of the premises and the other is alteration of the subject matter by including in a subsequent letting more than was previously let or, alternatively, by excluding some part formerly devised. Mere improvements or structural alterations do not constitute change of identity, but a certain percentage is allowed to the landlord upon the amount of expenditure on the improvements or structural alteration. thereforee, some change more radical than the mere fact of improvement or structural alteration must take place before it can be said that in effect the dwelling house newly let had previously not been let. The noble Lord observed that there was no simple general rule to provide an answer and in substance it remained a question of fact to be ascertained by the Court on the facts and circumstances of the case.

(4) Both the learned counsels for the parties have submitted that there is no decision of this court on this subject. Reliance has, however been placed on a few decisions of the High Court of Punjab. The Division Bench in Sadhu Singh's case after taking into consideration the dictionary meaning of the words 'construction' and 'building' from Webster's New World Dictionary, observed that the definition of the word 'building' in the Rent Act covered a part of the building which was let out to a tenant and this was a special definition for purposes of Rent Act to prevent eviction of tenants and to restrict the charging of excessive rents. The court observed that for purposes of this Act there was no distinction between construction and re-construction, but the court finally held that partial construction would not constitute construction, but where the entire part was pulled down and re-built, it would amount to construction and in each case it was a question, of degree when re-construction would amount to construction within the relevant provision of the Rent Act, In Master Umrao Singh v. S.P. Kaushik 1963. P.L.R. 613, it was held that it would not constitute change of identity of the premises if instead of a kitchen a bath room was included in the tenanted premises, nor if one room out of the three was replaced by another room of a similar size in the same building. In R.B. Sewak Ram Trust Society v. Mokham Chand 1964. P.L.R. 526, a learned Single Judge following the Division Bench Authority in the case of Sadhu Singh (supra) held that it was a question of degree as to when re-construction would amount to construction of the building within the meaning of the law and where the floor area of the shop remained the same, but the height had been raised which would give more storage space in the shop and if the old roof was replaced by the linted roof, reflooring and replastering were also done and the foundations of some of the walls were dugged again and the front wall was built anew, though the foundation of the back wall was not re-excavated and some of the previous building material was used in the new construction, it was found that the construction constituted a new construction. The counsel has cited Doriapandi Konar Vs . Sundara Pathar : AIR1970Mad291 wherein the connotation of the word 'repairs' within the meaning of section 108(f) of the Transfer of Property Act as well as section 2(7) of the Madras Buildings (Lease and Rent Control) Act was considered....On the facts of that cas,e, the Court found that the original building consisted of only the roof, walls, and the floor and thereafter the entire roof had been replaced, all the walls had been put up afresh and the flooring had been completely done up anew the building had been substantially renovated and it was, thereforee, a case of material alteration and improvement and not merely repairs.

(5) In view of the provisions of the Rent Act and the authorities cited above, my conclusion is that in each case it i-i a matter of degrees as to how improvements and alterations in an old existing building would constitute a much newly constructed or reconstructed premises, but in any view of the matter, very substantial structural alterations and improvements must be made in the main structure of the building before it can claim to be newly constructed. .rough and ready guide of practical value may, however, be found. Under section 331 of the Delhi Municipal Corporation Act erection of a building means to erect a new building on any site whether previously built upon or not and clause (b) defines the expression 'to erect a building' any building of which more than one half of the cubical contents above the level of the plinth have been pulled down, burnt or destroyed, or any building of which more than one half of the external walls above the level of the plinth has been pulled down or any frame building of which more than half of the number of posts or the beams in the external walls have been pulled down. This definition is special for the purpose of the Municipal Corporation Act to restrict the construction of building without permission but this definition has been applied and worked in Delhi in relation to case under the Municipal Corporation Act which was passed on 28.12.1957 and came into force on 7.4.1958 about the same time as the Delhi Rent Control Act, 1958 passed on 31.12.1958 came into force on 9th February, 1959. This definition is thereforee well understood by the landlords of the immovable properties in Delhi who must obtain sanction of the Corporation before they carry out any work of erection or re-erection of a building. The definition in the Corporation Act brings within its purview reconstruction of more than one half of the cubical contents or of the superficial area. In my opinion, in respect of the premises under the Delhi Rent Control Act, it would be safe to infer that where 3/4th of the main structure has been re-constructed or where the roof and the main walls on the three sides have been re-erected, it may constitute a new building within the meaning of the Rent Act irrespective of whether or not the flooring has been changed and the foundations re-excavated, but merely putting some internal walls or changing one or two side walls or carrying out other minor alterations and additions would ordinarily not constitute a newly constructed building. In addition to the structural changes indicated above, it is an essential condition under the Rent Act that to constitute a new premises, the building or part the building having been constructed, must separately be let or intended to be let out within the meaning of section 2(i) of the Act.

(6) The findings of fact concurrently recorded by the authorities below are that a big hall originally constructed on the ground floor in the year 1924, had been converted into 23 shops by raising partition walls without changing the roof or the ceiling or the flooring and the main structure of the building remained the same old one. On this finding, I agree with the Tribunal below that the premises in dispute do not constitute a newly constructed building. As such these are not exempt from the operation of the standard rent for any period under section 6(2)(b) of the Act.

(7) This leads to the question as to how, in accordance with the provisions of law, standard rent should be determined. Although the premises are not part of any newly constructed building, still these are not the same premises and thereforee, the rent payable in respect of the hall in 1924 or, for that matter, on 1st November, 1939, will not constitute the original rent as defined by the second schedule to the Act. We are, thereforee, left with section 6(1)(B)(i) and section 9(4) the Act. The authorities below have concurrently found that there is no satisfactory evidence of the cost of construction and the market price of the land and nothing has been urged to persuade me to hold that this finding is not correct. Section 9(4) of the Act leaves sufficient scope for exercise of judicial discretion to fix the rent which the Controller may consider reasonable, having regard to the situation, locality condition of the premises, amenities provided therein and the standard rent payable in respect of similar or nearly similar premises in the locality. In Chunnilal v. Ram Perkash 1970. B.C.R. 66, S.N. Andley, J (as he then was) observed as follows The fixation under this sub-section has necessarily to have on element of speculation and conjecture and it cannot be discarded merely on the ground that it is based on speculation and conjecture. 'The Controller has in a well considered order fixed the standard rent at Rs. 45.00 per month. It has been affirmed by the Tribunal. I do not find any infirmity with the said decision. Consequently I affirm it. Appeals dismissed.


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