IMPORTANT POINT
Provision for fair rent is applicable in case of contractual tenancy as well.

JUDGMENT

ASHOK BHUSHAN,J.

This appeal has been filed by the appellants, who are tenants of a non-residential building, challenging the judgment of the High Court for the State of Telangana at Hyderabad dated 30.08.2019 by which civil revision petition filed by the appellants challenging the order dated 30.04.2019 of the Chief Judge, City Small Causes Court, Hyderbad has been dismissed.

2. Brief facts of the case necessary to be noted for deciding the appeal are:

The appellants are tenants of a Shop No.M-1- 938/39 admeasuring 390 sq. ft. in New Marketing Complex, Tilak Road, Abids, Hyderabad. The appellants had entered into a lease agreement dated 27.08.1990 with the landlord by which the premises was let out for 20 years to the appellants from 21.08.1990 to 31.07.2010. The previous landlord Osman Bin Saleh transferred the premises in question in favour of respondent Nos.1 and 2 by registered sale deed dated 28.03.2008. The appellants were tenants on a monthly rent of Rs.1840/- excluding electricity charges and water charges. Respondent Nos. 1 and 2 who purchased the property on 28.03.2008 filed an application on 29.09.2009 for enhancement of rent. The application was contested by the appellants. The appellants had admitted the tenancy at the monthly rate of Rs.1840/-. The landlord had claimed that the market rent of the similar premises is Rs.75/- per sq. ft. and as per the market rent value the monthly rent of the shop shall be Rs.29,250/-. The Rent Controller, Hyderabad by order dated 04.11.2013 allowed the application of the respondents and fixed the fair rent at the rate of Rs.60/- per sq. ft i.e. Rs.23,400/-. The tenants were directed to pay the fair rent from the date of filing of the petition with future enhancement of 10% for every two years. Aggrieved by the judgment of the III Additional Rent Controller an appeal was filed by the appellants which appeal was dismissed by the Chief Judge, City Small Causes Court vide judgment and order dated 05.06.2017. Against the Appellate order dated 05.06.2017 a civil revision petition was allowed by the High Court on 20.09.2018 and the matter was remanded back to the Appellate Authority. After remand, Chief Judge, City Small Causes Court vide order dated 30.04.2019 dismissed the R.A.No.5 of 2014. Aggrieved by which judgment Civil Revision Petition No.1650 of 2019 was filed by the appellants in the High Court. The High Court after considering the submissions of the parties dismissed the revision petition vide its judgment dated 30.08.2019 which judgment has been challenged by the appellants in this appeal.

3. Shri Yelamanchili Shiva Santosh Kumar, learned counsel for the appellants submits that the contract of tenancy between the appellants and the landlord entered into on 27.08.1990 was to subsist till 31.07.2010, hence, the respondent-landlord had no authority or jurisdiction to file the application for enhancement of rent on 29.09.2009. He submits that Section 4 of the Telangana Building (Lease, Rent and Eviction) Control Rent, 1960 has no application on the contractual tenancy. It is submitted that landlord is bound by the contractual rent and during subsistence of contractual tenancy he cannot be allowed to file application for enhancement of rent. He submits that permitting the landlord to file application for enhancement of rent even though he is bound by a contract, will be permitting something which is against Rent Control Legislation. The Rent Control Legislations have to be interpreted in a manner so as to save tenant from exorbitant rent.

4. Learned counsel for appellants has placed strong reliance on minority judgment of this Court delivered by Bhagwati, J. in M/s. Raval and Co. vs. K.G. Ramachandran, 1974(1) SCC 424. Reliance has been placed on paragraphs 25 to 30 of the minority judgment which had taken the view that it is only when the contract of tenancy is lawfully determined that the landlord becomes entitled to apply for fixation of fair rent and during subsistence