1. The petitioner was the defendant (tenant) and the opponent was the plaintiff (landlord) in a suit for recovery of possession of the suit premises and arrears of rent. The suit in so far as it related to the relief of recovery of possession, was founded on only one ground, namely, that the petitioner was a tenant in arrears of rent who had forfeited the protection of the Rent Act. The trial Court found that the case was covered by S. 12(3)(a) and that the opponent was entitled to a decree of eviction. Al- it found that the petitioner was not entitled to be protected even under S. 12(3)(b) inasmuch as within one month of the service of the notice under S. 12(2) he failed to make an application under S. 11(3) for fixation of standard rent. In view of the findings aforesaid, the trial Court passed a decree of eviction. In appeal, the Appellate Court confirmed the material findings of the trial Court and consequently affirmed the decree of eviction. Hence the present Revision Application.
2-4. x X X X X X X X X
5. The question whether the petitioner is entitled to the protection of S. 12(3)(b) will, therefore, require fresh consideration at this stage. In order to claim the protection of the said sub-section, three conditions require to be satisfied: (1) on the first day of hearing of the suit or on or before such other date as the Court may fix, the tenant must pay or tender in Court the standard rent and permitted increases then due; (2) the tenant must thereafter continue to pay or tender in Court regularly such rent and permitted increases till the suit is finally decided; and (3) the tenant must also pay costs of the suit as directed by the Court. It is well settled that in order to earn the protection of the said subsection, the tenant must comply with all the conditions laid down therein and that if he fails to do so, the Court has no discretion to deny a decree to the landlord for possession (See Ambalal v. Babaldas, 3 Guj LR 625 at p. 647: (AIR 19,64 Guj 9 at p. 20)). The approach adopted by the Supreme Court in declining to grant the protection of the said sub-section to the concerned tenants in Vora Abbasbhai v. Haji Gulamnabi, 5 Guj LR 55 at pp. 61 & 62: (AIR 19,64 SC 1341 at pp. 1345, 1346); Dhansukhlal v. Dalichand, 9 Guj LR 759 at p. 765: (AIR 1968 SC 1109 at p. 1113) and M/s. Pioneer Paper Box Factory v. Smt. Thakurdevi, AIR 1971 SC 1781 at p. 17,82 also points in the same direction. It would thus appear that in order to claim the protection of S. 12(3)(b), the petitioner will have to show that he has complied with all the aforesaid conditions laid down in the said sub-section.
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9. That takes me to the consideration of the main question in dispute between the parties and that relates to the satisfaction of the third condition, namely, the payment of costs of the suit. It is not in dispute that in this case, the trial Court had not issued a direction before the decision of the suit with regard to the payment of costs. The costs were awarded only by the decree of the trial Court and they amounted to Rs. 122.89/-. The deposits made by the petitioner during the pendency of the appeal left a little balance after accounting for the rent due upto the date of the decision of the appeal. However, the said balance was not sufficient to cover the entire de- costs and there was a short-fall of Rs. 89.50 after adjusting the said balance towards the decretal costs. This led to the argument advanced on behalf of the opponent to the effect that since the petitioner had not fully paid the costs of the suit as directed by the Court, the third condition of S. 12(3)(b) must be held not to have been satisfied and the petitioner must be denied the protection of the said sub-section. The question is whether this submission is well founded,
10. In order to examine the validity of the contention, it would be necessary to bear in mind that costs of the suit are awarded under S. 35 of the Code of Civil Procedure, which is applicable to the Rent Courts. Under the said section, the costs of the suit -are in the discretion of the Court and the Court has full power to determine by whom or out of what property and to what extent such costs are to be paid, and to give all necessary directions for the said purpose. The normal rule under the said section is that the costs shall follow the event unless otherwise directed by the Court for reasons stated in writing. In a Full Bench decision of this Court in Civil Application No. 629 of 1975 with First Appeal No. 294 of 1971 which was decided on April 30, 1976, it has been explained that the principle in the matter of taxing party and party costs is that the costs are awarded, not as a punishment to the defeated party, nor as a bonus to the party which receives them, but as a recompense to the successful party in order to indemnify him, though not completely, for legal expenses to which he has been subjected in prosecuting his suit or his defence. A successful party would be entitled to come to the Court and say:
'This is a matter in respect of which I am entitled to get costs because I have been put to expense, and the law as administered in this Court allows me in that state of things to be indemnified by the defendant to the extent of party and party costs.'
It is this principle which, in the main, governs the exercise of discretion and provides the guideline for the exercise of power relating to the award of costs under S. 35. In a rent and possession suit, therefore, the Court may justifiably award to the landlord costs of the suit in the event of his success in order to indemnify him, though not completely, for the legal expenses to which he might have been subjected in prosecuting his suit. If the costs are accordingly awarded to him, the landlord would be entitled to recover them by executing the decree of costs unless it is set aside in appeal by the higher Court. The question, however, is whether in order to earn the protection of S. 12(3)(b) it would be obligatory for the tenant to pay to the landlord such decretal costs without driving the landlord to execution. In other words, the question is whether an order of costs passed by the trial Court under S, 35 of the Code of Civil Procedure while disposing of the suit amounts to a direction to pay costs of the suit as directed by the Court within the meaning of S. 12(3)(b).
11. While resolving this question, it will have to be borne is mind that the provisions of S. 12 place an embargo on the right of the landlord under the general law of the land to evict the tenant once he has terminated the lease by a valid notice to quit. The various sub-sections of S. 12 enact certain limitations and restrictions, procedural as well as substantive on the right of the landlord and give protection to the tenant at different stages. Clause (b) of sub-s. (3) of S. 12 with which we are immediately concerned, in substance, provides that in cases not falling within clause (a), that is to say, in cases in which rent is not payable by the month or in which there is a dispute regarding the standard rent and permitted increases or in which rent is not due for six months or more, no decree for eviction shall be passed upon the fulfilment of the conditions prescribed therein, one of them being that the tenant pays costs of the suit as directed by the Court. This part of clause (b) fell for construction in Vora Abbassbhai v. Haji Gulmnabi, 5 Guj LR 55 at p. 61:(AIR 1964 SC 1341 at p. 1345) and the following pertinent observations bring into limelight its essential contents:
'To bring his claim within S. 12(3)(b) the tenant must pay or tender the standard rent and permitted increases on or before the first day of hearing, or on or before such other date as the Court fixes, and also costs of the suit as may be directed by the Court. It may be noticed that the statute imposes upon the tenant obligation to pay or deposit the amount of costs if the Court so directs, and not otherwise. The observation made by the High Court to the contrary. viz:- 'It is, therefore, clear that the tenant in order to be entitled to claim the protection of S. 12(3)(b) must deposit cost of the suit along with the arrears of standard rent and permitted increases ... ' (1963-4 Guj LR 2,82 at p. 297) is in our judgment erroneous.'
Similarly, in Lalchand's case 17 Guj LR 1: (AIR 1976 Guj 122) (FB) (supra).* the aforesaid material words in clause (b) came up for consideration and the following observations were made in that context.
'A completely new notion is introduced by these last wards, namely, payment of the costs and it is with reference to this payment of costs that the words 'as directed by the Court' have been provided by the Legislature. Obviously until an order for costs is actually drawn up, a litigant will not know what costs he has to pay or tender or deposit in Court and hence. if the Court so directs, he has to pay the quantum of costs as directed by the Court, It is only for this limited purpose of payment of costs that the words 'as directed by the Court' have been laid down by the Legislature ......... Ordinarily the amount of costs would be known only after the decree is passed and the amount of costs is fixed by an order of the Court, but S, 12 (3) (b) contemplates that the tenant, in order to earn the benefit of S. 12(3)(b), over and above the amount of the standard rent and permitted increases may also have to pay the costs of the suit before the suit is finally decided. Since the amount of costs is not known to the tenant in advance, that is, before the suit is decided and the decree of the Court is passed, the Court may have to give directions regarding the quantum of costs and if the Court gives directions as to costs, the tenant has to pay such costs also before the suit is decided,' (Underlining supplied.)
It would thus appear that to seek the protection of clause (b), the tenant must, inter alia, pay or deposit the amount of costs. if the Court so directs and not otherwise. clause (b), it is significant to note, largely deals with the conduct of the ten-ant during the pendency of the suit. Until the suit is decreed and order of costs is actually drawn up, a ten-ant will not know as to what would be the costs of the suit. Besides, the payment or deposit of costs of the suit is made a condition for earning the protection of clause (b) and in the very nature of things, therefore, the tenant must have an advance intimation of the imposition of such condition to enable him to avail of such protection. It is for this reason that the words 'as directed by the Court' have been used by the Legislature and an entirely new notion is introduced, namely, payment of costs of the suit even before the suit is finally decided. Therefore, if the Court, in the exercise of its power under clause (b). wishes to impose upon the tenant the condition about payment of such costs, it will have to quantify the costs and direct the tenant to pay the same within such time as it fixes. Such a discretionary order will be made if the facts and circumstances of the case justify it bearing in mind the statutory guideline, namely, that the sub-section is intended to protect a tenant who shows his readiness and willingness to pay the rent.
12. It would appear from the foregoing discussion that by its very nature,an order of costs, which has to be complied with by payment or deposit of such costs in the Court in order to earn the protection of clause (lb), is a distinct order from an order of costs made under S. 35 of the Code of Civil Procedure. The principle regulating the exercise of discretion with regard to the direction of payment of costs under the two different provisions, namely, S, 12 (3) (b) and S. 35 cannot, in the very nature of things be identical. While exercising discretion under S, 12 (3) (b), the Court will have to bear in mind. as earlier pointed out, the facts and circumstances of the case and the guiding principle that a tenant who is ready and willing to pay the standard rent and permitted increases would be entitled to protection and that if the circumstances of the case justify it, a further direction with regard to payment or deposit of costs as a condition precedent to the earning of such statutory protection might be made. While exercising discretion under S. 35, however, an order of costs would be ordinarily made as a matter of course consequent upon the result of the suit, unless for some special reasons to be recorded in writing, the Court thinks otherwise It follows, therefore, that merely because in its decree, costs of the suit are awarded by the Rent Court to a landlord, it cannot be treated as a direction under S.12(3)(b), the failure to comply with which would disentitle the tenant to claim the protection of the said subsection.
13. The view which I am inclined to take as aforesaid can be fortified by an illustration. Take a case where a decree Of eviction is sought on two grounds: non-payment of rent and change of user, The trial Court decides against the plaintiff on the issue of non-payment of rent but Passes a decree on the ground of change of user and awards the costs of the suit. in appeal. the finding of the trial Court on the issue of change of user is reversed. The plaintiff tries to support the decree of eviction on the ground decided against him, namely, non-payment of rent. The Appellate Court finds that there was non-payment of rent and comes to the conclusion that the case was not covered by S. 12(1) and that S. 12(3)(b) was also not applicable. It then proceeds to consider the question whether the provisions of s. 12(3)(b) were satisfied so that the tenant can be protected against eviction. Could it be said in such a case that failure on the part of the tenant to pay the costs of the Suit as directed in the decree would deprive him of the benefit of the protection of the said provision? The answer must clearly be in the negative. The trial Court's decree of eviction was not based on the ground of non-payment of rent and in such a case, it would be difficult to hold that the order as to costs was a direction to pay costs within the meaning of S. 12(3)(b). The tenant was never faced with a decree of eviction on the ground of non-payment of rent and he could not have foreseen that an order of costs made under S. 35, C.P.C. in a suit where the decree of eviction was passed on a ground other than non-payment of rent, if not complied with by payment or deposit in the Court, would operate to deprive him of his statutory protection under S. 12(3)(b).
14. Let us now proceed to examine, in the light of the aforesaid view of the relevant condition in S. 12(3)(b), whether failure on the part of the petitioner to pay or deposit full costs of the suit results in forfeiture of the protection of the said sub-section. The trial Court awarded costs to the opponent but in so doing, it made a very pertinent observation which indicates that it was an order of costs made in exercise of its discretion under S. 35 of the Code of Civil Procedure. It observed:
'As the plaintiff succeeds on major part he is also entitled to costs from the defendant'
It would thus appear that in ultimately passing the order as to costs of the suit, the trial Court went by the principle that costs follow the event. It had never applied its mind to the relevant statutory guideline prescribed by S. 12(3)(b) nor did it make the payment or deposit of costs a condition for the earning of protection under the said sub-section. It also did not specify the date on or before which the costs could be paid or deposited by the petitioner in order to earn the protection of the said sub-section. The decree having been passed under S.12(3)(a). there was, in fact, no occasion for the trial Court to apply its mind to the provisions of S. 12(3)(b). Under such circumstances, in my opinion, failure on the part of the petitioner to pay or deposit the costs of the suit cannot deprive him of the protection of S. 12(3)(b).
15. It was, however, urged on behalf of the opponent that in the present case, there was a specific direction by the Appellate Court with regard to the deposit of costs and that since the said direction was not complied with, the petitioner was not entitled to the -protection of S. 12(3)(b). A few facts bearing on this question may be set out. Along with the memo of appeal, the petitioner had presented in the Appellate Court an application for stay on January 4, 1971. The Appellate Court passed an order below the said application on the same day, granting ad interim stay till the return of notice. After hearing the other side the Appellate Court made the following order on the said application on February 22, 1971:
'Stay to continue. The appellant to deposit costs of the suit and rent and continue to do so in future. in default, the stay shall stand vacated. Appeal expedited.
It is this direction with regard to the payment of costs which has been pressed into service in support of the argument that the petitioner had forfeited the protection of S. 12(3)(b). In my opinion. the argument is thoroughly misconceived. The terms in which the order of stay was made clearly indicate that the condition with regard to deposit of cost was imposed upon the petitioner as a condition for obtaining the stay in accordance with the normal practice prevailing in the Courts in this State which requires that in case a money decree, unless the appellant deposits the amount in the Court, no stay shall ordinarily be granted. The Appellate Court, as the very tenor of its order suggests, exercised the power in regard to the imposition of such condition under 0. 41, R. 5 and in consonance with the practice aforesaid and the only effect of its non-compliance, if any, would be that if such non-compliance was brought to the notice of the Appellate Court, it could have vacated the order of stay. The imposition of such a condition cannot be read as an exercise of power under S. 12(3)(b), last part by the Appellate Court at the stage of the admission of the appeal itself. In this connection, it also requires to be noted that -an order as to costs passed simpliciter under S. 35. C.P.C. by the trial, Court without application of mind on the question whether it should be treated as a direction under S. 12(3)(b), last part, cannot, at the stage of the admission of the appeal, be modified and converted into a direction under S,. 12 (3) (b) with regard to payment of costs as a condition precedent to the claiming of protection under S, 12 (3) (b) at the appellate stage, It would thus appear that merely ;because there was non-compliance, if any, with the order of the Appellate Court made at the stage of the admission of the appeal while granting the order of stay, it cannot be said that the protection of S. 12(3)(b) should not be accorded to the petitioner.
16. In my opinion, therefore, the fact that the total amount deposited by the petitioner in the Court till the appeal was finally decided fell somewhat short of the costs of the suit awarded to the opponent, it cannot be said. in the facts and circumstances of the present case, that he has forfeited the protection of S. 12(3)(b). Since all other conditions of the said sub-section are found to have been satisfied, the decree of eviction will have to be set aside.
17. x x x x
18. In the result, the Revision Application succeeds and is allowed. The decree of eviction passed against the petitioner is set aside and the suit is dismissed, so far as it relates to the relief of recovery of possession. There will be no order as to costs of this Revision Application
19. Revision allowed.