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W. and T. Avery, Ld. Vs. Kessoram Podder - Court Judgment

LegalCrystal Citation
CourtKolkata
Decided On
Judge
Reported in92Ind.Cas.1001
AppellantW. and T. Avery, Ld.
RespondentKessoram Podder
Cases ReferredBhulchand v. Grace
Excerpt:
calcutta rent act (iii of 1920), sections 2(f)(i), 11(5), 15 - standard rent, what is--benefit of act. - .....the subsequent period. this was refused and on the 23rd of july 1920, the amount was paid to the rent controller, and after that date the appellants continued to pay what, they contended, was the standard rent to the rent controller.6. the plaintiff gave notice to the appellants that he was intending to pull down and rebuild the premises, and he gave them notice to vacate the premises: no' action was taken on the first notice and apparently the plaintiff abandoned his intention to rebuild the premises, when he failed to get possession from the appellants and entered into an agreement to sell the premises to the imperial bank. that purchase was completed subsequently, viz., on the 7th of december l921.7. the plaintiff, on the 29th of december 1920, gave notice to the defendants to.....
Judgment:

Lancelot Sanderson, C.J.

1. This is an appeal by the defendants against the 'judgment of my learned brother Mr. Justice Chotzner.

2. It is necessary for me to state, certain facts:' The appellants were in occupation of one room on the ground floor of premises No. 1, Hastings Street, as monthly tenants from the end of 1911 or the beginning of 1912. The rental was Rs. 150 per month. That rental remained the same until' the year 1919. In 1911 the landlords were the Mullicks. In 1919 Messrs. Solomon & Co., took a lease from the Mullicks of the pre-raises No. 1, Hastings Street, for a term of 20 years. The appellants continued to be tenants under Messrs. Solomon & Co.

3. On the 5th of September 1919, an agree merit was made between the appellants and Messrs. Solomon & Co., to pay Rs. 500 rent per month; there were negotiations for a lease, which were never brought to completion. In December of the same year-the plaintiff, Kessoram Poddar, bought the lease from Messrs. Solomon & Co., and the premises from Messrs. Mullicks for a total of 11 lacs, paying 2 lacs for the lease and 9 lacs for the premises.

4. The plaintiff accepted the appellants as monthly tenants at the same fate of rent, namely, Rs. 500. The appellants paid the rent at the rate of Rs. 500 up to the end of April 19:'0. On the 6th of May 1920, the Calcutta Rent Act came into operation. In June the plaintiff demanded the rent for May: the appellants (hen said that they were liable to pay standard rent only, which was the rent payable on the first of November 1918, plus ten per cent, namely, Rs. 165.

5. Apparently, no reply was sent to that statement; and, on the 21st of July 1920, the appellants tendered the rent based upon the rate of Rs. 500 up to the 5th of May, when the Rent Act came into force, and at the rate of Rs. 165, which the appellants declared to be the standard rent, for the subsequent period. This was refused and on the 23rd of July 1920, the amount was paid to the Rent Controller, and after that date the appellants continued to pay what, they contended, was the standard rent to the Rent Controller.

6. The plaintiff gave notice to the appellants that he was intending to pull down and rebuild the premises, and he gave them notice to vacate the premises: no' action was taken on the first notice and apparently the plaintiff abandoned his intention to rebuild the premises, when he failed to get possession from the appellants and entered into an agreement to sell the premises to the Imperial Bank. That purchase was completed subsequently, viz., on the 7th of December l921.

7. The plaintiff, on the 29th of December 1920, gave notice to the defendants to vacate the premises at the end of January 1921. That is the notice to quit, upon which reliance is placed in this suit.

8. This suit was brought on the 10th of January 1922, and the claim was for rent from and including May 1920 to the end of January 1921 at the rate of Rs. 500 per month, and for damages for wrongful use and occupation of the premises from the 1st of February 1921 up to the 7th of December 1921, which, as I have said, was the date on which the plaintiff sold the premises to the Imperial Bank and after which he had no interest in the premises.

9. The first point, which was urged by the learned Advocate on behalf of the appellants, was that the plaintiff was not entitled to recover rent in respect of the first period, namely, from 5th May 1920 to January 1921, both months inclusive, at a rate higher than the standard rent in respect of these premises.

10. The learned Judge rejected that contention on the ground that the standard rent had not been fixed by the Rent Controller, and that there was a fallacy underlying the argument, because it proceeded upon the assumption that a tenant could standardize his own rent. The learned Judge held that the appellants ought to have applied to the Rent Controller for the standardisation of the rent and as they did not do so, they could not be heard in this suit to allege that they were not liable for more than the. standard rent.

11. The question is whether the conclusion, at which the learned Judge arrived, is correct.

12. I am not surprised at the conclusion at which the learned Judge arrived, because it has been pointed out on many occasions that the provisions of the Calcutta Rent Act are difficult to construe. With great respect, however, to the learned Judge I am unable to agree with the conclusion ,at which he arrived.

13. The question depends upon certain sections of the Rent Act.

14. Section 2(f) provides that 'standard rent' in relation to any premises means, (i) the rent at which the premises were 'let on the first day of November, 1918, or, where they were not let on that date, the rent at which they were last let before that date and after the first day of November, 1915, with the addition, in either case of ten per cent, on such rent [I need not read No. (ii) in connection with this case inasmuch as the premises in question were let on the 1st of November 1918];

(iii) in the cases, specified in Section 15, the rent fixed by the Controller.

15. The word 'or' does not appear between these sub-sections, but I think that it must have been intended that the sub-sections or clauses should be read disjunctively. Consequently 'standard rent' may be as described in (i), (ii) or (iii) in Section 2, Clause (f).

16. The learned Advocate who appeared for the appellants submitted that the' learned Judge was wrong in holding that the ten-ant had standardised his own rent. He argued that the rent was standardised by the Act and he pointed out that the first Sub-clause of Sub-section (f), if it stood alone, would clearly indicate that the standard rent was the rent at which the premises were let on the 1st of November 1918 with the addition of ten per cent, on such rent. '

17. But the learned Advocate who appeared for the plaintiff argued that the first Sub-section of Clause (f) does not stand alone and Sub-section (iii) must be considered.

18. Now, turning to Section 15, which is the section mentioned in Sub-section (iii), Section 2, Clause (f) it is found that 'the Controller shall, on an application made to him by any landlord or tenant, grant a certificate certifying the standard rent of any premises leased or rented by such landlord or tenant, as the case may be,' and that 'in any of the following cases, the Controller may fix the standard rent at such amount as, having regard to the provisions of this Act and the circumstances of the case he deems just.

19. Sub-section (d). is one of the following cases and refers to the case 'where the rent paid on the first day of November, 1918 (or, where the premises were not let on that date, the rent at which the premises were last let before that date) was in the opinion of the Controller unduly low.

20. Section 15, therefore, gives the landlord an opportunity of applying to the Controller and alleging that the rent paid in respect of these premises on the 1st of November 1918 was unduly low, and if he can prove that, it will be in the discretion of the Controller to fix the standard rent at an amount higher than the rent which was actually paid on the 1st of November 1918, subject to the proviso contained in the section that he cannot fix it at a higher amount than the highest rent actually paid for the premises at any time since the first day of November 1913. In this case the highest rent paid for the premises since the first day of November 1918 was Rs. 500 per month, so that if the landlord had applied to the Controller and alleged that the rent which had been paid in November 1918 was unduly low, the Controller might have fixed it at a higher amount. If he had been satisfied that the rent in November 1918 was unduly low,' the Controller might have fixed it at a higher amount, bat he could not fix it at a higher amount than Rs. 500 per month.'

21. Consequently, the learned Advocate for the plaintiff-respondent argued that on the 1st November 1918 rent plus ten per cent, should not be adopted as the standard rent in this case, because the Controller might upon an application by the landlord have fixed a higher rent.

22. In my opinion, that view ought not to be accepted. I think it was intended by the Act that prima facie the standard rent which was mentioned in Sub-section (i) of Clause (f) of Section 2 should be the standard rent, and in the absence of any application by the landlord to fix it at a higher rate, under Section 15, the 'standard rent' should be taken to be the rent at which the premises were let on the 1st of November 1918 with the addition of ten per cent, as provided by Sub-section (i).

23. It was net necessary, in my opinion, for the defendants in this case to show that they had made an application to the Controller and that he had fixed the standard rent at Rs. 165 before taking the point in this suit. In other words, in my opinion, it was open to the defendants-appellants to urge and rely upon the fact that the standard rent as fixed by the Act was Rs. 165 per month. Consequently, in my judgment, by reason of the provisions of Section 4 of the Act, the plaintiff was not entitled to recover any amount which exceeded the standard rent for the period from May 1920 to January 1921. The result,, therefore, is that, in my judgment, that part of the decree of the learned Judge which deals with the amount of rent recoverable should be varied.

24. I understand that the standard rent had been deposited with the Controller and has in fact been withdrawn by the plaintiff.

25. The remainder of the case relates to the question whether the notice in December 1920 was a valid notice. That depends upon the construction to be placed upon Section 11, Sub-section (5). That sub-section provides: 'No tenant shall be entitled to the benefit of this section in respect of any premises, unless within three months of the date of the commencement of this Ac he has paid all arrears of rent due by him in respect of the said premises, and also unless he pays the rent due by him to the full extent allowable by this Act within the time fixed in the contract with his landlord, or, in the absence of any such contract, by the fifteenth day of the month next following that for which the rent is payable'.

26. It is to be noticed that this section deals with the granting of an order or a decree for recovery of possession only.

27. The point arises in this way: As I have already mentioned, the amount of the standard rent for May and June was not tendered to the landlord until the 2lst July 1920 and was not paid to the Rent Controller until the 23rd of July 1920, and it is not denied that that was not paid within the time specified by the Act. But the learned Advocate for the appellants presented an ingenious argument based upon Sub-section (5) of Section 11 which was to this effect. He argued that Sub-section (5) was intended to give a tenant three months within which he might pay the arrears of rent, and that such arrears would include not only any arrears of rent, which might be due'at the time the Act came into force, but also any arrears of standard rent which might become due after the Act came into force.

28. In my judgment this argument ought not to be accepted. Having regard to the words used in the sub-section and to the framing of the sub-section, I think it is' clear that the intention was to give the tenant the benefit of the section, if he complied with two conditions: in the first place he must have paid any arrears of rent which might be due at the time of the passing of the Act within three months of the commencement of the Act; and, secondly, he must pay the rent to the full extent allowable by the Act within the time fixed by the contract with his landlord and in the absence of any such contract by the 15th day of the month next following that for which the rent is payable.

29. In this case the appellants did not pay the rent within the time fixed in the contract or by the 15th day of the month, which followed the months of May and June for which the rent was payable: and, consequently, in my opinion, the appellants were in default.

30. It is true that the plaintiff did not act upon the default until the end of the year; but he was within his rights in giving the notice in December 1920 which expired at the end of January 1921.

31. Consequently, after January 1921 the appellants were trespassers and were no longer tenants, and they are liable to the plaintiff for compensation for the wrongful use and occupation of the premises from the 1st of February 1921 to the 7th of December 1921.

32. The learned Judge awarded compensation at the rate of Rs. 500 per month. He based his judgment to a large extent upon the evidence given by Mr. Shrosbree.

33. It was argued on behalf of the appellants that the plaintiff's case was that he wanted the premises in order that he might pull them down and re-build; that he abandoned that intention of his own accord and sold the premises; that although he alleged that he had suffered loss; he gave no proof of the alleged loss and, there-, fore, that the most the plaintiff could recover would be such rent as the plaintiff could have recovered from a tenant during those months; that having regard to the provisions of the Calcutta Rent Act the plaintiff could not have recovered from any tenant more than the standard rent in respect of the premises and that as the appellants bad in fact paid to the Controller the standard rent for this period and the plaintiff had received the same, the plaintiff was not entitled to any damages at all.

34. On the other hand, it was argued on behalf of the plaintiff that the learned Judge was right in awarding damages at the rate of Rs. 500 per month.

35. I agree with the learned Judge's decision as to the amount of the damages although I base my judgment on grounds somewhat different to those stated by the learned Judge.

36. The plaintiff can only' recover such dam-'' ages as flow naturally from the breach of duty or breach of contract in the ordinary and usual course of things.

37. The evidence was that the appellants had willingly agreed to pay Rs. 500 a month' for the premises in 1919. Further they desired to take a lease for three years at the. rate of Rs. 500 per month. The evidence further shows that the appellants tried to find other premises but they could not get' any other suitable premises at a lower rent than Rs. 500 a month.

38. Now, after January 1921, as I have already said, they were no longer tenants and they were not in a position to take advantage of the Calcutta Rent Act--they were wrongdoers.

39. In these circumstances it is not unreasonable to hold that Rs. 500 a month was -fair compensation for the use and occupation of the premises by the defendants after. January 1921.

40. It was not for the plaintiff to prove what would have been the standard rent if ah application had been made to the Controller.

41. The premises are in an important quarter of the town and the defendants, before the Rent Act came into operation, were willing to pay Rs. 500 per month Prima facie therefore, it is not open to the defendants to allege that such amount was not a fair rent for a tenant to pay. If an application had been made to the Rent Controller he might have fixed the standard rent at less than Rs. 500 per month. On the other hand, he might have fixed it at Rs. 500 a month.

42. No application was made and that question was never decided.

43. It has, therefore, not been proved what the standard rent would have been if the matter had come before the Controller. In the absence of any such decision and upon the evidence in the case, I am not. satisfied that the learned Judge was wrong in holding that the damages for the wrongful use and occupation of the premises; by the defendants should be assessed on the basis of Rs. 5t0 a month.

44. The result is that the sum of Rs. 4,500 decreed as rent will be reduced to Rs. 1,485 making the total amount of the decree Rs. 6,601-10-6. .

45. As regards costs, we are of opinion that the appellants should have the general costs of the appeal and the costs of one day's hearing. We do not interfere with the order of the learned Judge as regards costs.

46. The money received from the Rent Controller by the respondents will be taken as part satisfaction of the decree and satisfaction will be entered lo that extent.

Buckland, J.

47. I will first deal with the point whether the notice to quit was a valid notice. For this purpose, though I shall give my reasons later, I may say at once that, in my opinion, the amount of rent which the appellant Company had to pay was the amount which they actually deposited with the Rent Controller month by month and it is on this basis that I will deal with the question as to the notice to quit. The appellant Company, therefore, were entitled to the benefit of Section 11 of the Act provided they paid that amount either to the landlord by the fifteenth day of the month next following that for which it was payable, or, if refused by the landlord, deposited it with the Rent Controller under Sub-section (4). The difficulty in which the appellant Company find themselves is that as regards the rent for May 1920 they deposited it out of time and by reason of that they are precluded from claiming the benefit of the section.

48. The argument that the 'arrears' referred to in Sub-section (5) includes rent in arrear during the first three months after the Act came into force, and payable in respect of those months leads to the difficulty that in regard to those three months, if that construction were adopted, there would be two inconsistent provisions as to the payment of rent, namely, that provided in the first part of Sub-section (5) that the tenant shall have three months within which to pay such rent and that provided by the latter part that he must pay or deposit his rent month by month.

49. The correct construction of this sub-section, in my opinion, is that the 'arrears' referred to are arrears due at the time when the Act comes into force and that the first part has nothing to do with rent which accrues due month by month after that date.

50. The next question is as to the amount of rent to which the plaintiff was entitled for the period between the 1st of May 1920 and the 2lst of January 1921. This involves consideration of various sections of the Calcutta Rent Act, an Act of faulty construction which renders it difficult of interpretation.

51. The contention of the plaintiff, stated briefly is that unless the standard rent has been fixed by the Controller the tenant is not entitled to take advantage of the provisions of the Act, for, in fact no rent has been fixed by the Controller as standard rent of the premises in suit.

52. For the defendant Company on the other hand, it has been argued that, though not necessarily in alb cases but probably in. the majority of cases and certainly in this case, there is a standard rent which, so to speak, attached to property from the moment that the Calcutta Rent Act came into force irrespective of any application made to or order passed by the Rent Controller under the Act, and that, subject to what I shall have to say presently, that is the amount which the tenant must pay or deposit.

53. 'Standard rent ' is defined in Section 2(f)as the rent at which the premises were let on the first day of November 1918, or,, where they were not let on that date, the rent at which they were last let between the first day of November 1915 and the first day of November 1918, phis ten per cent on such, rent in either case.

54. The sub-section furnishes two more definitions of which the second may be ignored. It has no application to the present case.

55. The third definition involves reference to Section 15 and provides that in the cases specified in Section 15 the 'standard rent' is the. rent fixed by the Controller. Now, in order to ascertain what those cases are, for it is in. those cases alone that rent fixed by the Controller is 'standard rent' according to the definition, one must look at Section 15(3). The first two sub-sections have nothing to do with this matter, Sub-section (3) is sub-divided into five cases each involving different sets of circumstances, none of which has any application to the present case. If it had been intended that standard rent should only be such rent as the Rent Controller has fixed, and that in the circumstances contemplated by Section 2(f)(i) all that the Rent Controller would have to do would be to ascertain the rent on the date material thereunder and add ten per cent, it would have been more correct to have included such a case among the cases under Section 15 (3) and eliminated Section 2(f) (i) altogether. But, inasmuch as the case with which we have to deal is not one of those mentioned in( Section 15 (3) and consequently is not one in which the Rent Controller may fix the standard rent thereunder, it follows that under the definition clause the action of the Rent Controller in fixing the standard rent should be excluded.

56. I do not, however, altogether exclude the operation of Section 15(1) under which the Controller may certify the standard rent, though he fixes it in appropriate cases under Section 15(3). It may be that in a case to which Section 2(f)(i) applies it is open to a party to apply to the Controller for a certificate. This point does not arise in this case but I mention it lest the juxtaposition of these two sub-sections should lead to the suggestion that in a case to which Section 2(f)(i) applies it is the duty of the party interested in having it clone to make an application to the Rent Controller under Section 15(1), even if Section 15(3) has no application.

57. In my opinion, the contention of learned Counsel for the appellant Company is the correct one and where the conditions contemplated by Sub-section 2(f)(i) exist, the standard rent follows as a matter of course, subject, however, to this that it is always open to a landlord or a tenant to make an application to the Rent Controller under, Section 15(3) if he can bring the matter within its several provisions. Upon the Rent Controller so fixing the rent then there is another standard rent for the premises as defined by the Act. This leads to the curious result that there may be a standard rent as defined by Section 2(f)(i) and a standard rent as defined by Section 2(f)(iii), both simultaneously applicable to the same premises. There is, however, no practical difficulty because when you come to apply other provisions of the Act and, in particular, Section 4(l) or Section 11(5), the landlord would be entitled to the benefit of whichever standard rent might be the higher. In this view, the amount which the plaintiff was entitled to recover from the defendant Company was the amount for which the premises were let on the 1st of November 1918 plus ten per cent. There is no question as to what that amount was and, in my opinion, the judgment and decree of the learned Judge should to this extent be modified,

58. The learned Judge has relied upon an earlier judgment of mine in Jetka, Bhulchand v. Grace 70 Ind. Cas. 494 : 26 C.W.N. 678 : A.I.R. 1923 Cal. 220. That is not an authority for the proposition that if standard rent has not been fixed by the Controller, the 'tenant must pay the agreed rent to the landlord or deposit it with the Controller.''!* that case according to my recollection, which the report confirms, there was no, competition as 'between the standard rent, and the agreed rent. The only question-was whether the tenant had paid or deposited his rent in time. I am not sure that the learned Judge referred to the case on the question of amount, but without explanation it might be so interpreted and deemed to conflict with the opinion now expressed.

59. The last question is that of damages. I agree with the opinion expressed, by the learned Chief Justice and have nothing to add.

60. I concur in the order to be made.


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