Back
2012 Supreme(Del) 1653
IN THE HIGH COURT OF DELHI AT NEW DELHI
V.K. JAIN, J.
Alliance Association Ltd. - Appellant
Versus
M/s. Sagwamal Kishan Lal - Respondent
RFA No.257/2012
Decided On : 04.07.2012
For the Appellant :Mr. Ravish Kumar Goyal, Advocate
For the Respondent: None
The absence of statutory provisions for fair and reasonable rent increase creates a void in the legislation, and in the absence of a statutory or contractual right for rent enhancement, the landlord has no cause of action to seek a declaration for increased rent.
Headnote:
Rent Control Act - Jurisdiction of Civil Court - Sections 4, 6, 9 - Summary
Fact of the Case:
The appellant, a landlord, filed a suit for recovery of arrears of rent at an increased rate. The respondent, a tenant, failed to pay the increased rent and the appellant sought a declaration for the revised rent. The trial judge rejected the plaint, citing the jurisdiction of the civil court being barred under Section 50 of the Delhi Rent Control Act.
Finding of the Court:
The court found that the appellant's suit was not maintainable as the statutory provisions of the Delhi Rent Control Act did not allow for unilateral increase in rent by the landlord in the absence of a contractual or statutory provision. The court also noted the absence of a mechanism for fair and reasonable rent increase, creating a void in the legislation.
Issues: The issues involved were the jurisdiction of the civil court to entertain suits related to rent fixation, the validity of the appellant's claim for increased rent, and the absence of statutory provisions for fair and reasonable rent increase.
Ratio Decidendi: The court held that in the absence of statutory or contractual right for rent enhancement, the appellant had no cause of action to seek a declaration for increased rent. The court also emphasized the need for the legislature to address the absence of a mechanism for fair and reasonable rent increase.
Final Decision: The appeal was dismissed, affirming the rejection of the plaint as it did not disclose any cause of action for the suit.
V.K.JAIN, J. (ORAL)
1. This appeal is directed against the judgment and decree dated 14.03.2012, whereby an application filed by the respondent under Order 7 Rule 11 (d) of the Code of Civil Procedure for rejection of the plaint was allowed and consequently the plaint was rejected.
2. The facts giving rise to the filing of this appeal can be summarized as under:-
The appellant is the owner/landlord of property No.6298, Gali Batasian, Khari Baoli, Delhi and the respondent is a tenant under it in respect of a shop in the aforesaid property. The shop was let out at the rent of Rs.80/- per month, exclusive of electricity and water charges. The appellant demanded rent from the respondent @ Rs. 16,000/- per month on the ground that the market rent of similar premises was about Rs. 20,000/- per month. Since the respondent failed to pay rent @ Rs. 16,000/- per month, the appellant filed a suit for recovery of Rs. 5,76,000/- being arrears of rent for a period of three years @ Rs. 16,000/- per month. The learned Trial Judge took the view that the jurisdiction of the civil court was barred in view of Section 50 of the Delhi Rent Control Act. The plaint having been rejected, the appellant is before this Court by way of this appeal.
3. Section 4 of the Delhi Rent Control Act to the extent relevant for our purpose, provided that except where rent is liable to periodical increase by virtue of an agreement entered into before the 1st day of 1939, no tenant, shall, notwithstanding any agreement to the contrary, be liable to pay to his landlord, any amount in excess of the standard rent of the premises, unless such amount is a lawful increase of the standard rent in accordance with the provisions of the Act. It further provided that any agreement for payment of rent in excess of the standard rent shall be construed as if it were an agreement for the payment of the standard rent only. Thus, as per the aforesaid statutory provision, a landlord, irrespective of his agreement with the tenant, cannot recover more than a standard rent of the tenancy premises.
4. The constitutional validity of Sections 4, 6 and 9 of the Delhi Rent Control Act all of such deal with standard rent was challenged before this Court by way of CWP 2783/1997. Vide judgment dated 18.1.2002, a Division Bench of this Court, held the aforesaid provision to be ultra vires Articles 14, 19(1)(g) and 21 of the Constitution. In the course of judgment, the Division Bench, inter alia, observed as under:-
“11. It may be noted that the respondents have not filed any reply to the affidavit of the petitioner dated November, 7, 2000. It appears that the respondents are not in a position to contradict the steep erosion in the value of rupee and the progressive increase in the wholesale price index during the years mentioned above. The position as of now has not improved. Rather the value of rupee has depreciated further. It is, Therefore, apparent that the increase in rent under Section 6A is not commensurate with the fast dwindling value of rupee. There is a huge difference between the value of rupee of 1939, 1944, 1947 and 1958, etc. on one hand and as of today on the other hand. Yet the standard rent determined under Section 6 of the Act is tied to the past without there being any mechanism for raising the same to a reasonable extent to offset the erosion in the value of rupee. The so-called increase under Section 6A of the Act is an eye-wash. It does not dilute or neutralise the shackling effect of Sections 4, 6 and 9 of the Act on rents. It appears to us that Section 4, which bars recovery of rent of any premises in excess of standard rent except in certain circumstances, Section 6 of the Act, which lays down the principles for determining the standard rent, and Section 9, which empowers the Rent Controller to fix the standard rent to any premises on the basis of the principles set out in Section 6 of the Act, unduly and unreasonably fetter the rights of the landlords unde
