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1995 Supreme(Del) 375

High Court Of Delhi
PERMANAND VERMA - Appellant
Versus
VIMAL CHAND JAIN - Respondent
C.M. 62 of 1995
Decided On : 05/01/1995

Advocates Appeared:
C.P.WIG, P.K.RAVAL

The security deposit is not liable to be adjusted against arrears of rent at interim stages, such as when a notice of demand is issued or an eviction petition is filed.

Headnote:

DELHI RENT CONTROL ACT - SECTION 14 (1) (A) - SECURITY DEPOSIT - ADJUSTMENT AGAINST ARREARS OF RENT - NOT PERMISSIBLE - PURPOSE OF SECURITY DEPOSIT IS DIFFERENT.

Fact of the Case:

The tenant deposited a security deposit of Rs. 33,000 with the landlord at the time of letting the premises. The landlord served a notice of demand on the tenant claiming arrears of rent and filed an eviction petition under Section 14 (1) (a) of the Delhi Rent Control Act. The tenant challenged the eviction order in various courts but was unsuccessful.

Finding of the Court:

The court held that the security deposit is not liable to be adjusted against arrears of rent at interim stages, such as when a notice of demand is issued or an eviction petition is filed. The purpose of a security deposit is to secure the landlord against various defaults of the tenant at the time of final determination of the lease.

Issues: Whether the security deposit can be adjusted against arrears of rent.

Ratio Decidendi: The court relied on previous decisions of the Delhi High Court which held that the amount lying by way of security deposit with the landlord on behalf of the tenant is not liable to be adjusted against arrears of rent. The court also noted that the Delhi Rent Control Act does not contain any provision requiring adjustment of any advance rent or other amounts paid by the tenant to the landlord contrary to the provisions of the Act.

Final Decision: The court dismissed the tenant's petition challenging the eviction order.

Arun Kumar

( 1 ) WITH the consent of learned Counsel for both the parties I have heard the main petition on merits since only a short point is involved.

( 2 ). Briefly the facts are that the premises was let out on 1/11/1988 to the petitioner herein at a monthly rent of Rs. 2000. 00. A sum of Rs. 33,000. 00 was given as security deposit by the tenant to the landlord. The landlord issued a notice of demand on 1/8/1989 claiming arrears of rent with effect from 1/2/1989. The eviction petition was filed on 31/10/1990 under clause (a) of the proviso to Sub- section (1) of Section 14 of the Delhi Rent Control Act (hereinafter REFERRED TO to as the Act ). An order under Section 15 (1) of the Act was passed on 28/4/1992 directing led appeals against the said order before Rent Control Tribunal. The landlord s appeal was allowed on 30/1/1993 and the tenant was directed to pay or deposit arrears of rent with effect from 1 /2/1989 in stead of 1 /8/1989 as directed by the Additional Rent Controller. The appeal of the tenant was dismissed. The tenant challenged the said order further in this Court byway of a petition under Article 227 of the Constitution of India which was dismissed on 30/12/1993.

( 3 ) IN the meanwhile the defence of the tenant was struck off by the Additional Rent Controller on 14/1 /1993. Appeal against the said order was dismissed by the Rent Control Tribunal on 11/3/1993. A petition on behalf of the tenant further challenging the said order in this Court met the same fate. Ultimately the eviction order was passed on merits against the tenant on 29/9/1993. The Rent Control Tribunal dismissed the tenant s appeal against the said eviction order on 10/12/ 1993. The present petition under Art. 227 of the Constitution of India is directed against the said order of the Rent Control Tribunal.

( 4 ) THE only point urged before me on behalf of the petitioner tenant is based on the fact that a sum of Rs. 33,000. 00 was deposited by the tenant with the landlord by way of security. The said amount was not to bear any interest. The contention of the learned Counsel for the petitioner is that on the date of the notice at best it could be said that a sum of about Rs. 12,000. 00 was due to the landlord on account of arrears of rent. The landlord was liable to adjust the said amount against the amount of security deposit lying with the landlord and if the adjustment had been made there would have been no arrears of rent and the very cause of action for a petition under Section 14 (1) (a) would be non-existent. The argument of the learned counsel further suggests that under the law the tenant is not even bound to ask the landlord to make adjustment from the amount lying in deposit with the landlord. It is for the landlord himself to make such adjustments. In this connection the learned Counsel for the petitioner has relied on a judgment of the Supreme Court in Kranti Swaroop Machine Tools Pvt. Ltd. and Anr. v. Smt. Kanta Bai Asawa and Ors. , 1994 (1) Rent Law Reporter 217. On the face of it is appears that the said judgment supports the contention of the learned Counsel for the petitioner. However, a closer look shows that it is not so. The said judgment is in the context of the Andhra Pradesh Builders (Lease, Rent and Eviction) Control Act, 1960, which contains provision regarding adjustment of amounts paid by a tenant to the landlord by way of advance rent, in excess of one month s rent or any amount paid towards premium etc. contrary to the provisions of the said Act. The present case is in the context of the Delhi Rent Control Act which does not contain any such provision. There is nothing in the Delhi Rent Control Act requiring adjustment of any advance rent or other amounts paid by the tenant to the landlord contrary to the provisions of the Act.

( 5 ) THE learned Counsel for the respondent landlord has brought to my notice certain decisions of this Court which hold that the amount lying by way of security deposit with the landlord




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