1998(2) Supreme 370
Supreme Court of India
(From Karnataka High Court)
S. Saghir Ahmad & G.B. Pattanaik, JJ.
Abbobaker & Anr. -Appellant
versus
Mahalakshmi Trading Co. -Respondent
Civil Appeal No. 757 of 1998
(Arising out of SLP (C) No. 23174 of 1996)
Decided on 10-2-1998
Counsel for the Parties :
For the Appellant : R.F. Nariman, Sri. Advocate, N.P.S. Panwar, S.N. Bhat, Advocates.
For the Respondent : G.V. Chandra Shekhar and P.P. Singh, Advocates.
Held : The expression ‘prevailing rent in that area’ used in clause (5) of the terms of compromise is suggestive of the only conclusion that the parties intended that the liability of the tenant to pay rent after occupying the new premises is at a concessional rate of 25% less of the rent which would be prevailing in the area in respect of similar premises. The word ‘fair rent’ in clause (5) does not refer to the fair rent to be fixed by the Controller under the statute. The expression ‘fair’ has been used in contradistinction with the expression ‘unfair’ or ‘unreasonable’. In other words, the prevailing rent in the area in respect of similar premises must be the reasonable rent received in the area in respect of similar premises and not a fanciful or whimsical rent which a particular tenant might be offering to a landlord in the area in question. In this view of the matter, we are of the considered opinion that the High Court committed an error in interpreting clause (5) of the compromise decree to mean that the tenant would be liable to pay rent at a concessional rate of 25% less of the fair rent to be fixed in respect of premises by the Controller under Section 14 of the Act. The said conclusion of the High Court is accordingly set aside. (Para 4)
To avoid further protraction of litigation and for doing complete justice in respect of the matter in this appeal we think it appropriate to exercise our jurisdiction under Article 142 of the Constitution and to decide as to what would be the prevailing rent in the area for the purpose of enforcing clause (5) of the compromise decree. Having considered the relevant suggestions given at the Bar and the rent at which the respondent was occupying the earlier premises which stood demolished and the new construction have come up, we think it appropriate to hold that the prevailing rent in the area in respect of the premises in question should be Rs. 10/- per sq. ft. and as such 400 sq. feet, in occupation of the respondent would fetch a rent of Rs. 4000/- per month. But in terms of the compromise decree the respondent being entitled to occupy at a concessional rate of 25% less of the prevailing rent, he would be liable to pay Rs. 3000/- per month and this he is required to pay from the date he has taken possession of under the orders of the executing court, and we accordingly so direct. (Para 5)
Judgment
G.B. Pattanaik, J.-Leave granted.
2. This appeal is by the landlord against the order dated 22nd August, 1996 passed by the Karnataka High Court in HRRP No. 1769 of 1995 arising out of HRC No. 66 of 1994. The appellant-landlord filed the aforesaid HRC case under Section 21(1)(j) of the Karnataka Rent Control Act against the tenant-respondent in respect of the premises in question. The aforesaid proceeding was ultimately disposed of on the basis of a compromise entered into between the parties and the terms embodied in the compromise petition dated 22nd April, 1994 formed a part of the decree of the court. In accordance with the aforesaid compromise decree the tenant delivered the vacant possession of the tenanted premises and the landlord was permitted to demolish and reconstruct a new building thereon. It was also stipulated in the compromise that the tenant will be accommodated in the two shop rooms measuring 200 sq. ft. each on the ground floor soon after the new construction is over and be further accommodated in two shop rooms measuring 200 sq. feet each in cellar floor for the purpose of godown after the construction is over. Clause (5) of the compromise decree dealt with the rent to be paid by the tenant or occupying the premises in the new building after construction of the same. The dispute in the present case centres round the terms and conditions of the aforesaid clause (5) and what was the rent intended to be paid by the tenant for occupation of one shop in the cellar floor and one shop in the ground floor. The appellant-landlord on getting vacant possession of the tenanted premises, demolished the same and put up a new construction. The tenant-respondent filed a petition for getting possession of the newly built shops in accordance with the compromise decree dated 22.4.1994 and the said petition was registered as Execution Petition No. 204 of 1995. In the said execution proceedings the appellant-landlord was set ex-parte and the executing court directed issue of delivery warrant. Subsequently, under the orders of the executing court the lock was broke open and with the police help the tenant-respondent got the possession of the premises as per the compromise decree and the execution case was closed. The landlord-appellant approached the High Court against the order of the executing court directing delivery of the possession in favour of the respondent and obtained an interim order of stay of issuance of delivery warrant on 6.12.1995, but much before the said date the premises in question had been possessed by the respondent-tenant on 28.11.1995, and therefore, the interim order issued by the High Court became infructuous. The landlord-appellant before the High Court though raised a contention that the compromise decree could not have been executed but Mr. R.F. Nariman, learned senior counsel, appearing for the appellant did not press the same. The tenant thus has obtained possession of 400 sq. ft. of the newly constructed building in execution of the compromise decree and that has become final. A further contention had been raised by the landlord before the High Court to the effect that the compromise decree is an integrated one and under the decree though the tenant would be entitled to get possession of two shop rooms measuring 200 sq. feet each after the new construction of the shop rooms are over but the said tenant is also liable to pay rent at a concessional rate of 25% less of the prevailing fair rent in the area and without discharging that obligation the tenant could not have merely obtained possession of the two shop rooms measuring 400 sq. feet in execution of a part of the decree. The tenant, however, resisted the aforesaid contention by contending that the tenant would be liable to pay 25% less of the fair rent to be determined by the Controller under Section 14 of the Act and until that determination is made the landlord cannot resist the execution of the decree in relation to possession
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