1. These are twelve Rules of a somewhat varied composition. They concern five tenancies, each in respect of one or more rooms in premises No. 124 Chattaranjan Avenue, Calcutta, and all held under the same landlord. The tenants of all the tenancies made applications for standardization of the rent and the Rent Controller fixed the standard rent at certain amounts. Neither the landlord nor the tenants were satisfied and both parties preferred appeals. There were thus ten appeals. The appellate Court varied the rent to a certain extent in favour of the landlord, but did not vary it to an extent sufficient to satisfy him. As the rent was increased, naturally, the tenants were also dissatisfied with the decision of the appellate Court. Thereafter, both sides moved this Court under Section 32(4), Rent Control Act. As there had been two appeals in respect of each tenancy in the Court below, one by the tenant and the other by the landlord, there were ten applications by the tenants. The landlord, however, made only five applications. The tenants obtained Rules on all the ten applications made by them, but the landlord was granted Rules only on two of theirs. There are thus altogether twelve Rules before us.
2. Before proceeding further, it is necessary to dispose of a preliminary point. sometime ago, these cases were mentioned before us for an order that all of them might be heard together and because of certain observations made by us on that occasion, Mr. Gupta, who appeared on behalf of the tenants, submitted that the competency of the Rules obtained by his clients should be determined first. It appears that in each of the applications made by the tenants, it was stated that the value was 'below Rs. 1,000/-'. It was on that footing that the tenants went to a learned Judge, sitting singly, and obtained Rules from him. The landlord, on the other hand, valued his applications at twelve times the monthly rent and as the figure thus arrived at exceeded Rs. 2,000/-, he went to a Division Bench. It is well settled that if a Rule is issued by a learned Judge, sitting singly, in a case where, under the distribution of business in this Court, only a Division Bench can exercise Jurisdiction, the Rule issued by the Judge, sitting singly, is not a valid Rule. Accordingly, if the valuation put by the landlord on his applications was the true valuation, the Rules obtained by the tenants must be held to be Rules issued without jurisdiction.
3. Mr. Gupta submitted that while all this might be true, no principle had ever been laid down regarding the method of valuing applications for standardization of rent. He accordingly submitted that we should avail ourselves of the present opportunity to lay down the principle to be followed in valuing applications of this kind and Rules arising out of them.
4. I have already stated that the tenants did not put down any precise figure as the value of any one of their applications, but merely stated that the value was 'below Rs. 1,000/-'. I have protested before and must protest again against this method of valuing an application which is of no use whatever. If the valuation has any meaning, and it has undoubtedly much, inasmuch as it determines the jurisdiction of the Court, the petitioner must always set out in his petition the method which he employs for making the valuation and explain how he reaches the figure which he puts down at the head of the petition. To say merely that a particular petition is valued 'below Rs. 1,000/-' or 'above Rs. 2,000/-' is saying nothing more than that the petitioner wants to go to a learned Judge, sitting singly or that he wants to go to a Division Bench. It would be well for the profession to bear in mind that the valuation of a petition is a matter of practical importance and the petition must always explain the method by which the valuation actually put on the petition was arrived at.
5. It is, however, true that the principle applicable to the valuation of applications for standardization of rent has never been laid down. Mr. Das Gupta, who appears on behalf of the landlord, drew our attention to the provisions of Section 7(xi)(cc), Court-fees Act, and appeared to suggest that those provisions would apply. The provision, pointed out by Mr. Das Gupta, has obviously no application, because it refers to suits for recovery of immovable property. Mr. Das Gupta then drew our attention to clause (f) of Section 7(xi), court-fees Act, which deals with suits for abatement of rent and submitted that at least that provision would apply. It is clear that even Section 7(xi)(f) cannot in terms apply, because it deals with suits and seems also to deal with occupancy tenants. Be that as it may, it is clear that if there be no other provision of law which is directly applicable, one might reasonably apply the principle embodied in Section 7(xi)(f), Court-fees Act, in determining the valuation of an application for standardization of rent. To that provision will have to be added the provisions of Section 8, Court-fees Act, which lay down that except in certain cases, of which the present case is not one, the valuation for the purpose of jurisdiction and that for the purpose of court-fees shall be the same.
6. This, however, does not dispose of the question, because we are considering what principles should apply to the valuation of applications for standardization of rent, which may be made either by a landlord or by a tenant. Usually, a landlord will expect an enhancement of the rent, whereas a tenant will expect a reduction, or there may be a case where a landlord does not specifically ask for an enhancement, nor is he willing to submit to a reduction, but simply because a question has arisen between him and his tenants as regards the true rent payable, he approaches the Rent Controller to standardize the rent once for all and to terminate the bickerings. In such a case, I conceive, the case will be analogous to that of a suit for the Settlement of a fair and equitable rent. We have, therefore, to consider three types of cases, cases in which the landlord is the applicant & he expects an enhancement, cases in which the tenant is the applicant and he expects a reduction and cases where neither enhancement nor reduction is specifically asked for, but what is asked for is only the settlement of a fair and reasonable rent.
7. Those being the three varieties of cases which may possibly arise, it is necessary to enquire what principle would apply equally to all of them. One possible view is that at least in the first two types of cases, the subject-matter of dispute is the difference between the contractual rent and the rent which the applicant proposes and which he thinks will be the proper rent, in the case of an application by the landlord, the subject-matter of dispute will therefore be the difference between the contractual rent and the enhanced rent which he claims, and in the case of an application by the tenant, it will be the difference between the contractual rent and the reduced amount which, he asserts, would be the fair and reasonable rent. Such cases are not specifically provided for in the Court-fees Act and had the matter been agitated in a suit, the provision applicable would be Article 1 of Schedule I of the Court-fees Act read with Section 8 of the Suits Valuation Act. The Legislature, however, at least in respect of suits between landlords and tenants of occupancy lands, seems to have made a departure from the general principle in Section 7(xi), Court-fees Act, and, therefore, suits for enhancement of rent and abatement of rent have been specifically provided for. In both cases, the value is the amount of rent payable for the year next before the date of presenting the plaint, in other words, twelve times the monthly contractual rent, except in cases where the rent was varied during those twelve months. It seems to me, therefore, that although the other principle I have referred to appears also to be a pertinent one, the better course to follow would be to act on the analogy of Section 7(xi), Court-fees Act, and hold that, the true valuation of applications for standardization of rent would be an amount equivalent to the amount of rent payable for the year next preceding the presentation of the application, in other words, twelve times the monthly contractual rent, when the rent has been uniform and, in other cases. the total of the actual rent for the twelve months. So far as applications of the third type are concerned, the analogy is with suits for the settlement of a fair and equitable rent and since the value of each suit is the amount of actual rent claimed, the value of an application of the third type will be twelve times the contractual rent which, it is presumed, the landlord will decide to have maintained. The principle applicable is thus in effect the same.
8. If the above be the true principle, it is clear that the present applications made by the tenants were beyond the jurisdiction of a learned Judge, sitting singly, except in one case and it would follow, in view of the decisions of this Court, that eight of the Rules issued at the instance of the tenants are not competent. It would not perhaps be strictly correct to discharge them, for having been issued without jurisdiction, they have no legal existence. But since there is no limitation for applications of this kind, it would be open to the tenants to approach a Division Bench even now and to ask for a reissue of the same Rules. We do not think it is necessary to insist on that piece of formality being gone through and we are prepared to treat the Rules as re-issued by ourselves and to proceed to dispose of them on that basis.
9. Coming now to the merits of the Rules, I have already stated that there are twelve of them, concerning five tenancies. Mr. Gupta who appears on behalf of the tenants intimated to us, after some argument, that he did not wish to press the Rules obtained by his clients in respect of three of the tenancies. The Rules which he thus abandoned were Rules Nos. 1310, 1312, 1313, 1314 and 1315. Those Rules concern tenancies in respect of which the landlord failed to obtain a Rule. The contest between the parties, therefore, narrowed down to the cases relating to the two tenancies in respect of which both the parties had obtained Rules. The cases concerned were No. 327C and No. 388C of 1951 before the Rent Controller. With regard to the first, the tenants have obtained Rules Nos. 1316 and 1317 of 1952 and the landlord has obtained Rule No. 1398 of 1952. With respect to the second, the tenants have obtained Rules Nos. 1309 and 1318 of 1952 and the landlord has obtained Rule No. 1399 of 1952.
10. So far as Case No. 327C is concerned, the position is as follows. The tenancy comprises three rooms and a veranda on the fourth floor of the house and the contractual rent is Rs. 250 per month. The Rent Controller proceeded on the footing that Section 9 (1) (g) of the Act applies to the case and the first thing he did was to work out what he called the local average of rents charge-ed for similar premises in the neighbourhood. The figure he arrived at was Rs. 101-7-7, to which he added ten per cent thereof, thus arriving at Rs. 121-9-11. He next proceeded to consider the evidence of an expert who was a Chartered Engineer and an Associate of the Institute of Engineers and whose evidence was that the fair and reasonable rent would be Rs. 226/- per month. The Rent Controller struck a mean between the figure which he himself had arrived at from the local average and the figure mentioned by the expert and decided on Rs. 178/13/0 which he fixed as the standard rent.
11. On appeal, the learned Judge thought that Section 9(1)(g) of the Act did not apply to the case, but the provision applicable was Section 9(1)(e). In that view, he was not alone, because, as he states in the judgment, both the parties agreed before him and, in fact, insisted that it was Section 9(1)(e) which ought to be applied. In applying that provision, the learned Judge first determined Rs. 170/- to be the rent at which the premises might reasonably have been let in 1941 and adding ten per cent thereto, he reached the figure of Rs. 187/- which he fixed as the standard rent.
12. It is rather curious and to a certain extent even intriguing that while both the parties agreed before the learned Judge that the provision applicable to the case was Section 9(1)(e), before us they agreed that the section applicable would be Section 9(1)(g). If we also agree with them, there is very little to decide, since there is in effect no longer any dispute between the parties.
13. In my opinion, the view urged before the appellate Court by both the parties was plainly erroneous and the view adopted before us is plainly the correct view. The fourth floor of the building was constructed in 1946 and 1947 and no rooms situated on it could possibly have been let in 1941 at a reasonable rent or otherwise. It is clear from the provisions of the Rent Act that Schedule A contemplates a case where the premises concerned were in existence in 1941 and were also let, whether or not any standard rent had previously been fixed. Section 9(1)(e) also contemplates a case where the premises concerned were in existence in 1941, but were either not let at that time, or if let not let at a proper and adequate money rent. The case where the premises existed in 1941 and were also let, but where the rent at which they were let cannot definitely be ascertained is provided for in Sub-section (2) of Section 9, where certain principles are laid down as to how the rent at which the premises were let in 1941 is to be ascertained. But it seems to me that the rent thus to be ascertained is also to be taken as the actual rent which the premises fetched in 1941 and the case remains a case under Schedule A. Sub-section (2) of Section 9 says quite specifically that the rent ascertained in accordance with the principles laid down in that sub-section 'shall be deemed to be the rent at which the premises were let on December 1, 1941.' The two provisions, namely, Schedule A and Section 9(1)(e) thus exhaust between themselves the cases where the premises were in existence in 1941 and were either let or not let. Neither of these provisions has any application to a case where the premises concerned were not in existence in 1941 at all.
14. As I have already stated, the fourth floor in the present case was constructed in 1946 and 1947. It was, therefore, not in existence in 1941, nor was it constructed after 31-12-1949. There is thus no specific provision in the Rent Act which applies to it and it must obviously be governed by the residuary provision contained in Section9(1)(g).
15. As I have stated, it was that provision which the Rent Controller applied. We cannot, however, merely restore the Rent Controller's finding, because the parties are entitled to a decision by the appellate Court and there appear to be several questions which require to be considered as regards the evidence used by the Rent Controller in applying Section 9(1)(g) and the manner in which he has applied it. Since we are sending the case back for a rehearing of the appeal, it would not be proper for us to make any further observations at this stage on any of those questions.
16. Proceeding now to the other case, namely, Case No. 388C, the tenancy there consists of, leaving aside verandhas and balconies, three rooms on the fourth floor of the house and three rooms on the second floor. The fourth floor, as I have already stated, was constructed in 1946 and 1947, but the second floor was in existence in 1941. The contractual rent is 390/-. With regard to this tenancy, the Rent Controller appears to have followed a composite and a somewhat curious method. He took first the three rooms on the fourth floor as constituting a separate unit or a tenancy and similarly he took the three rooms situated on the second floor as constituting another tenancy and having fixed the standard rent for each, he added up the two in order to reach the final figure. The local average he found with respect to the three rooms on the fourth floor was Rs. 138-6-9. The expert's figure was Rs. 283-8-0. As in the other case, so in this, the Rent Controller struck a mean between the two & fixed the standard rent for the three rooms on the fourth floor at Rs. 210-15-4. Dealing next with the three rooms on the second floor, the Rent Controller found the rent at which the premises could have been reasonably let in 1941 to be Rs. 92-0-7. Adding ten per cent to it, he reached the figure of Rs. 101-3-10 which he determined to be the standard rent for the three rooms on the second floor. Adding up the two amounts of Rs. 210-15-4 and Rs. 101-3-10, he fixed the standard rent for the entire tenancy, constituted of the three rooms on the fourth floor and the three rooms on the second floor, at Rs. 312-3-3.
17. On appeal, the learned Judge, on the same concession as had been made to him by the parties in the other case and himself agreeing in the view submitted to him, applied Section 9(1)(e) of the Act. He thought that if the premises had been let in 1941, it would have fetched a rent of Rs. 300/-. He added ten per cent of that figure and fixed the standard rent for the entire tenancy at Rs. 330/-.
18. It appears to me that Section 9(1)(e) is even more plainly inapplicable in this case than in the other. The method followed by the Rent Controller in splitting up the rooms constituting the present tenancy into two sets and spelling out two tenancies which he dealt with separately, is altogether indefensible and has no warrant, either in the provisions of the Rent Act or in reason. What he had to consider was the rent for the premises which constituted the present tenancy and whatever criterion or standard of comparison he might apply, it had to be a criterion or standard which was applicable to all the constituent parts of the tenancy, taken as a whole. Obviously, there was no tenancy and there could not have been any tenancy in 1941 in respect of all the six rooms, nor could a correct result be arrived at by ascertaining the present fair and reasonable rent for the two sets of rooms separately by reference to what had been determined as the standard rent in respect of other premises, similar respectively to each set, which had in turn been done by reference to either the actual rent prevailing in 1941 or the rent at which those premises might reasonably have been let in that year. The tenancy, as I have pointed out, had to be taken as a whole. The specific provisions contained in the Rent Act do not contemplate a tenancy composed partly of rooms in existence in 1941 and partly of rooms constructed after 1941 but before 31-12-1949. Clearly, therefore, this also is a case which must be dealt with under the residuary provision contained in Section 9(1)(g). In other words, the authorities must determine the fair and reasonable rent for the premises constituting the entire tenancy by reference to relevant materials. As neither the learned Judge, nor the Rent Controller has done anything of that kind, this case also must go back to the learned Judge for a rehearing of the appeal
19. For the reasons given above, Rules Nos. 1316 and 1317, 1309 and 1318 of 1952 obtained by the tenants are made absolute. Rules Nos. 1398 and 1399 of 1952 obtained by the landlord are also made absolute. The cases 327C and 388C. are sent back to the appellate Court in order that the learned Judge may rehear the appeals arising out of those cases and determine them in accordance with law. The rest of the Rules obtained by the tenants, namely, Rules Nos. 1310, 1311, 1312, 1313, 1314 and 1315 of 1952 are discharged.
20. Since both parties were wrong in the Court below and both have been responsible for the present Rules, there will be no order for costs.
21. I agree.