A lease in contravention of the Rent Control Order would be void.

Headnote:
RENT CONTROL - C. P. AND BERAR LETTING OF HOUSES AND RENT CONTROL ORDER, 1949 - CLAUSE 22 - INtimation of vacancy - Failure to give intimation - Effect - Lease in contravention of the Order - Void - Estoppel - Waiver.
Fact of the Case:

Plaintiff purchased a house in 1954. Shiojibhai was occupying three blocks in the house as a tenant. Shiojibhai died in 1958 leaving behind his daughters and two brothers. Plaintiff alleged that by Diwali 1958, both the blocks were given in possession of the plaintiff and thereafter one of the blocks was taken on lease by Shamjibhai on a monthly rent of Rs. 100. From October-November 1959 till October-November 1961 Shamjibhai and the defendant were jointly possessing the suit premises as tenants on the rent of Rs. 100 per month. After November 1961, the defendant alone continued as a tenant. Plaintiff contended that the lease of the suit premises initially to Shamjibhai in 1958 and thereafter to Kakubhai in 1961 was bad and inoperative, inasmuch as it was in contravention of the provisions of the C. P. and Berar Letting of Houses and Rent Control Order, 1949 (hereinafter referred to as the Rent Control Order). Defendant resisted the suit by his written statement. He denied that in November 1958 possession of both the blocks was handed over to the plaintiff or that thereafter the suit premises were separately taken on rent by Shamjibhai. He pleaded that he was working with Shiojibhai in the shop premises as Shiojibhai's grandson and as such was entitled to the interest in the estate of deceased Shiojibhai as well as of his heirs. The defendant further pleaded that after Shiojibhai's death, the plaintiff agreed that the old lease would subsist and that on or about 22-11-1958 the plaintiff accepted Shamjibhai as a tenant along with the defendant. It was further pleaded that possession was not handed over to the plaintiff at any time and that, therefore, there was no necessity for giving intimation to the Rent Controller under clause 22 of the Rent Control Order. The defendant denied that the lease in his favour is void. The defendant made a reference to the Rent Control proceedings and the Small Cause Suit that was filed by the plaintiff and then contended that the plaintiff is also estopped on account of taking such steps on the basis that the defendant was a tenant.
Finding of the Court:

The trial Court held that no intimation was given to the Rent Controller when Shamjibhai or the defendant was put in possession of the suit premises as a tenant. A finding was recorded that the lease in favour of Shamjibhai as also of the defendant is void on account of the absence of such intimation. The learned Civil Judge found that the defendant has been in permissive possession and as such a licensee. The said licence was treated as revoked on account of the plaintiff's notice. The suit was, therefore, decreed and hence this appeal.
Issues: 1. Whether the lease in favour of Shamjibhai and later on in favour of the defendant is hit by clause 22 (2) and is, therefore, void as it is forbidden by law? 2. Whether the plaintiff would be estopped from making the contention about the void nature of the lease? 3. Whether the suit as framed is not tenable? 4. Whether the plaintiff would not be entitled to mesne profits at a rate higher than the agreed rate of rent? 5. Whether an interest of Rs. 58.32 should not have been allowed on the amount of mesne profits?
Ratio Decidendi: 1. Yes, the lease in favour of Shamjibhai and later on in favour of the defendant is hit by clause 22 (2) and is, therefore, void as it is forbidden by law. Clause 22 (2) of the Rent Control Order gives a sure indication that the occupation of a tenant in contravention of the Rent Control Order is not permitted. 2. No, the plaintiff would not be estopped from making the contention about the void nature of the lease. Filing of the proceedings would not constitute estoppel, particularly when the question is about the validity or otherwise of a lease. 3. No, the suit as framed is tenable. A party to a void contract cannot take advantage so as to prejudice the other side. In the instant case the question is not merely of waiver of statutory rights enacted for the benefit of an individual but whether to Court would aid the appellant in enforcing a term of the agreement which section 15 of the Act declares to be illegal. 4. No, the plaintiff would be entitled to mesne profits at a rate higher than the agreed rate of rent. The learned Civil Judge, after considering the evidence, came to the conclusion that a claim of Rs. 10 per day is properly made out. The decree for mesne profits is thus quite legal. 5. No, an interest of Rs. 58.32 should have been allowed on the amount of mesne profits. The definition of the term "mesne profits" as given in section 2 (12) of the Code of Civil Procedure shows that mesne profits include not only the profits as covered by the definition but also interest on such profits.
Final Decision: Appeal dismissed with costs.

JUDGMENT

GADGIL J.- This is defendant's appeal challenging the decree passed against him in Special Civil Suit No. 16 of 1966 of the file of the Civil Judge, Senior Division, Akola.

2. The litigation pertains to the shop premises situate at Akola. They are part of house No. 92 in ward No. 29. This house is of the ownership of the plaintiff since 2-2-1954 as on that date the plaintiff purchased it from the previous owner Messrs Sawatram and Sons Limited under the sale deed Ex. 117. Deceased Shiojibhai was occupying in all three blocks or tenements in the said house as a tenant since before this purchase. There is no dispute that Shiojibhai left possession of one of the blocks sometime in 1956. Thereafter the two blocks continued in possession of Shiojibhai on the rent of Rs. 1,761 per year. Shiojibhai died on 9-3-1958 leaving behind him his daughters and two brothers by name Shamjibhai and Hansraj. There is no dispute that these three brothers had already partitioned their estate on 15-11-1948 under the partition deed Ex. 128.

3. The plaintiff's case in brief is that by Diwali 1958 i.e. by about, 11-11-1958 both the blocks were given in possession of the plaintiff and thereafter one of the blocks, namely, the suit premises were taken on lease by Shamjibhai on a monthly rent of Rs. 100. Till next Diwali, (i.e. October November 1959) Shamjibhai alone was the tenant of that block. At this stage we would like to state that it is this block which is the subject-matter of this litigation. Thereafter from October-November 1959 till October November 1961 Shamjibhai and the present defendant Kakubhai were jointly possessing the suit premises as tenants on the rent of Rs. 100 per month. The plaintiff further, alleges that after November 1961 (after Diwali 1961) the defendant alone continued as a tenant, and since then he has been paying rent. The plaintiff, however, contends that the lease of the suit premises initially to Shamjibhai in 1958 and thereafter to Kakubhai in 1961 was bad and inoperative, inasmuch as it was in contravention of the provisions of the C. P. and Berar Letting of Houses and Rent Control Order, 1949 (hereinafter referred to as the Rent Control Order). Clause 22 of that Order prescribes that every landlord shall within seven days from the date on which a house becomes vacant or available for occupation give intimation about this fact to the Collector in the prescribed form and that he shall not let it or occupy it except in accordance with clause 23. Clause 23 states that on receipt of such intimation but within fifteen days thereof the Collector may order the landlord to let out the house to a person mentioned in the order. If no such order is passed, the landlord is entitled to let out the house to any person. The main allegation in the plaint is that the plaintiff has not given any intimation about the suit premises having fallen vacant in November 1958 when they were let out to Shamji. Similarly no intimation was given when the premises were let out to the defendant in October-November 1961. With this allegation it is contended that the transaction of lease is void as it is forbidden by law, and that, therefore the defendant has been in possession either as a licensee or as a trespasser. The plaintiff had in 1965 filed two proceedings against the defendant one was Small Cause Suit No.8 of 1965 claiming a decree for arrears of rent of Rs. 200, and the other proceeding was under clause 13 of the Rent Control Order. That clause provides that a landlord can terminate the tenancy of a tenant only after obtaining previous permission of the Rent Controller. The grounds on which such permission can be granted are enumerated in clause 13 (3). Both these proceedings were, however withdrawn by the plaintiff. For example, Ex. 115 is a copy of the order-sheet in Small Cause Case No.8 of 1965 showing that the suit was dismissed for default. Similarly the order-sheet Ex. 114 shows that the Rent Control Case No. 211/71/64-65 wa

Click Here to Read the rest of this document