Andhra Pradesh High Court
Judges : MADHAVA REDDY
Executive Committee of Guntakal municipality - Appellant
Versus
Dhanunjaya Sastry, Cashier, Poorna pictures, Guntakal - Respondent
Decided On : 04-01-75
SMALL CAUSE COURT - JURISDICTION - SUIT FOR DAMAGES FOR USE AND OCCUPATION - NOT A SUIT FOR RECOVERY OF RENT - MAINTAINABLE IN SMALL CAUSE COURT - RENT FIXED BY MUNICIPALITY UNDER FUNDAMENTAL RULES - REASONABLE - DAMAGES ASSESSED ON BASIS OF SUCH RENT - CORRECT.
Fact of the Case:
The plaintiff-Municipality filed a suit in the Small Causes Court for recovery of Rs. 200 as damages for use and occupation of a building by the defendant, an outsider, who had not entered into any lease agreement with the Municipality. The Municipality had fixed the rent for outsiders at Rs. 35 per month for similar buildings, but the defendant had been paying only Rs. 20 per month. The lower Court decreed the suit for Rs. 8 with interest at 6% per annum from the date of suit till realization, holding that the Municipality was entitled to enhance the rent unilaterally and that Rs. 27 per month was a reasonable rent for the building occupied by the defendant.
Finding of the Court:
The High Court held that the suit was maintainable in the Small Causes Court as it was not a suit for recovery of rent but for damages for use and occupation. The Court further held that the rent fixed by the Municipality under the Fundamental Rules was reasonable and that the damages should be assessed on the basis of such rent. Accordingly, the Court modified the decree of the lower Court and decreed the suit as prayed for, including the interest claimed at 6% per annum from the date of filing of the suit till the date of realization.
Issues: 1. Whether the suit was maintainable in the Small Causes Court? 2. Whether the Municipality was entitled to enhance the rent unilaterally? 3. What was the reasonable rent for the building occupied by the defendant? 4. Whether the damages should be assessed on the basis of the rent fixed by the Municipality?
Ratio Decidendi: 1. A suit for damages for use and occupation is not a suit for recovery of rent and is therefore maintainable in the Small Causes Court. 2. A Municipality is entitled to enhance the rent unilaterally if there is no rental agreement between the Municipality and the occupier. 3. The reasonable rent for a building is the rent fixed by the Municipality under the Fundamental Rules. 4. Damages for use and occupation should be assessed on the basis of the rent fixed by the Municipality.
Final Decision: The High Court allowed the revision petition, modified the decree of the lower Court, and decreed the suit as prayed for, including the interest claimed at 6% per annum from the date of filing of the suit till the date of realization.
( 2 ) THE main contention of the revision petitioner is that the lower Court was not justified in decreeing the suit for Rs. 8. The lower Court ought to have decreed the suit at the rate of Rs. 35 per month treating it as a monthly rent. The learned counsel for the respondent contended that the suit ought not to have been tried by a Small Causes Court because a suit for recovery of rent is expressly excluded from the jurisdiction of the Small Causes court.
( 3 ) TO appreciate the above contentions, it is necessary to refer to the facts of the case, which are relevant. The plaintiff is the Guntakal Municipality. It filed a suit for recovery of Rs. 200 with interest at 6% with future interest at 6% per annum from the date of plaint claiming the amount as damages for use and occupation by the defendant. It is alleged in the plaint that the Municipality constructed a number of buildings (28) in a group known by the name " Low Income group Houses". The said buildings were constructed in the year 1958-59, situated in Hanumeshnagar, in 15th ward of Guntakal Municipality. As there were surplus buildings, the Municipality let out the same to outsiders on a monthly rent of Rs. 20 per building on temporary basis. One Krishnachari, an outsider, was occupying building bearing Door No. 15/591 belonging to the plaintiff-Municipality. From 1st April, 1967, the present defendant occupied the said building without entering into any lease agreement with the plaintiff-Municipality. The defendant is also an outsider, i. e. , not an employee of the Municipality. It is further alleged that in the month of march, 1966, the Municipality provided additional amenities like electric installations to the buildings. It also constructed latrines and chimneys to the said buildings including the building occupied by the defendant. The said additional amenities cost the plaintiff-Municipality rs. 21,900-75 Ps. for the abovesaid 28 buildings. Taking this into consideration and also taking into account the fact that Guntakal is a growing town and there is much demand for the residential houses but mainly keeping (in mend) the expenses for construction of the said houses, the municipality fixed the rent as per P. W. D. Rules and Fundamental Rules according to the plinth area occupied by the houses and enhanced the rent from Rs. 20 to rs. 35 per month per each building occupied by the outsiders. A resolution to that effect was also passed by the Municipality bearing No. 658 of 1966, dated 16th June, 1966. It is alleged that the defendant knew about this resolution. This amount was liable to be paid by the defendant to the plaintiff by way of damages for use and occupation of the house since the defendant has not entered into any agreement with the plaintiff with regard to rent. The defendant is thus liable to pay from the month of april, 1967 onwards to the end of March, 1969 by way of damages for use and occupation at the rate of Rs. 35. The defendant has paid an amount of Rs. 640 and the amount at the rate of Rs. 35 comes to rs. 840. Thus a balance of Rs. 200 is payable by the defendant towards damages for use and occupation. Therefore, the plaintiff prayed for a decree for that amount with future interest at 6% as stated above.
( 4 ) THE defendant filed a written statement alleging that the suit is not maintainable in law or on facts. The plaintiff has no cause of action to file the suit. The court has no jurisdiction to entertain the suit and grant a decree for the said amount. It is alleged that the plaintiff ought to have filed a petition before the Rent Controller for enhancement of rent and it was not open to the plaintiff to unilaterally enhance
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