High Court Of Delhi
CHAMBER OF COLOURS AND CHEMICALS PRIVATE LIMITED - Appellant
Versus
TRILOK CHAND JAIN - Respondent
SECOND APPEAL 30 of 1969
Decided On : 05/28/1973
RENT CONTROL ACT - SECTION 15(1), 15(7) - DEPOSIT OF RENT - DESTRUCTION OF PREMISES BY FIRE - SUSPENSION OF RENT - OPTION TO TREAT LEASE AS VOID - TRANSFER OF PROPERTY ACT, SECTION 108(E) - INTERPRETATION AND APPLICATION.
Fact of the Case:
Tenants failed to deposit rent as ordered by the Rent Controller under section 15(1) of the Delhi Rent Control Act, 1958, claiming suspension of rent due to the destruction of part of the premises by fire. The landlord applied for an order to strike out the tenants' defense under section 15(7) of the Act.
Finding of the Court:
The Rent Controller condoned the tenants' default, but the Tribunal allowed the landlord's appeal and struck out the tenants' defense. The tenants appealed to the High Court.
Issues: 1. Whether the Rent Controller's order condoning the tenants' default was an order in his discretion that should not have been interfered with by the Tribunal? 2. Whether the tenants had the right to suspend payment of rent upon the destruction of the premises and the landlord's refusal to reconstruct or permit reconstruction?
Ratio Decidendi: 1. The discretion granted to the Rent Controller under section 15(7) of the Act must be exercised in accordance with well-settled principles. The Tribunal was entitled to interfere with the Rent Controller's order considering the tenants' delay in seeking modification of the rent deposit order and their failure to exercise the option to treat the lease as void under section 108(e) of the Transfer of Property Act. 2. Under section 108(e) of the Transfer of Property Act, the tenants had the option to treat the lease as void upon the destruction of the premises by fire. However, they did not exercise this option and continued to hold on to the premises. Therefore, they remained liable to pay rent.
Final Decision: The High Court dismissed the tenants' appeal, holding that the Tribunal was justified in striking out their defense and that they had not made out a case for interference.
( 1 ) IN this second appeal under section 39 of the Delhi Rent Control Act, 1958, the tenants are the appellants and the landlord is the respondent. On June 12, 1964, the respondent filed a petition for eviction of the appellants under the said Act on the ground of non-payment of rent, sub-letting and change of user. Admittedly, the contractual rent was Rs. 500. 00 per month. Since one of the grounds for eviction was non-payment of rent covered by clause (a) to the proviso to sub-section (1) of section 14 of the said Act, the Rent Controller, on September 16, 1964 passed an order as required by sub-section (1) of section 15 of the said Act, against the appellants to deposit arrears of rent amounting to Rs. 3,700. 00upto May 27, 1964 and then up to date rent at the rate of Rs. 300. 00 which was fixed as the interim rent within one month from that date and future rent at the same rate month by month by the 15th of each succeeding month. It was not disputed that the arrears of rent and the interim rent were deposited by the appellants upto April, 1966.
( 2 ) IN another proceeding between the parties for fixation of standard rent, the Controller by his order dated April 30, 1966, fixed Rs. 187. 00 per month as the standard rent with effect from January 1, 1960. On appeal, the order fixing standard rent was quashed by the Tribunal on January 22, 1968 and the case was remanded back to the Rent Controller for fresh trial.
( 3 ) IN the mean time, on May 2, 1966, part of the premises were destroyed by fire. Inasmuch as the appellants did not deposit the interim rent fixed by the Controller, the respondent on April 27, 1968, made an application to the Controller under sub-section (7) of section 15 of the Act praying for an order that the defence against eviction may be struck out. The appellants replied to this application on May 27, 1968 and contended that the amount deposited by them already was in excess of the amount which had to be deposited. They further pleaded that the respondent was not entitled to claim rent on the ground that part of the premises had been destroyed by fire particularly as the respondent had refused cither to reconstruct the destroyed premises or to permit the appellants to do so. After filing this reply, the appellants also filed an application on June 11, 1968. They contended that the rent already deposited was in excess of the rent due and that part of the tenancy premises had been destroyed by fire and were not in existence and that the standard rent of the premises which remained in existence could not be more than Rs. 40. 00 per mensem. The appellants, therefore, prayed that the order dated September 16, 1964 under sub-section (1) of section 15 of the Act REFERRED TO to earlier be modified and an order be made for deposit of rent in view of the circumstances mentioned in this application.
( 4 ) BY order dated August 6, 1968, the respondent s application under sub-section (7) of section 15 of the Act was dismissed. By this order, the Controller condoned the appellants default in depositing the rent and fixed a date for disposing of the appellants application dated June 11, 1968 for modification of the order dated September Ib. 1964.
( 5 ) BEING dissatisfied with the dismissal of his application under subsection (7) of section 15 of the Act, the respondent filed an appeal before the Tribunal. By order dated December 6, 1968, the Tribunal allowed the appeal and the respondent s application under subsection (7) of section 15 of the Act and struck off the appellants defence with a direction that the respondent s petition be decided according to law. Against this order, the appellants filed this appeal. During the pendency of. this appeal, the Controller on January 3u, 1969 passed an order of eviction against the appellants, the appeal against which before the Tribunal was dismissed on April 3, 1972 on the ground of having been filed beyond time. Against this order, the appellants have filed
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