The prevailing rate of rent in the locality and the facilities available in the room should be considered in fixing the fair rent, and the rent paid by nationalized banks should not be the sole basis for determining the fair rent of a room occupied by a private party.

ORDER

R. Narayana Pisharadi, J.

The tenant challenges in this revision the concurrent finding of the courts below regarding the fair rent of the room occupied by him.

2. The petitioner is the tenant of one of the rooms in the four-storied building owned by the respondent. The building is situated in Kottakkal Town. The rent of the room is Rs.9,450/- per month. The area of the room is 800 sq.ft. The petitioner is conducting a photo studio in the room.

3. The respondent filed application under Section 5(1) of the Kerala Buildings (Lease and Rent Control) Act, 1965 for fixing the fair rent of the room leased out to the respondent. He prayed that the fair rent of the room may be fixed at Rs.40/- per sq.ft, that is, Rs.32,000/- per month.

4. The Rent Control Court, after an elaborate discussion of the evidence adduced in the case, fixed the fair rent of the room at Rs.38.25/- per sq.ft, that is, Rs.30,600/- per month. The appellate authority confirmed the finding of the Rent Control Court.

5. We have heard learned counsel for the petitioner and also the respondent.

6. The room occupied by the petitioner is in a fourstoried building owned by the respondent. The building is situated in Kottakkal Town. There can be no dispute with regard to the fact that the room is in a building which is situated in a locality having high commercial importance.

7. The main challenge raised by the petitioner in the revision petition is with regard to the basis adopted by the Rent Control Court for fixing the fair rent of the room. Evidence was adduced in the case to prove that the rent paid by the State Bank of India for a building occupied by it is Rs.40/- per sq.ft. Ext.Cl report of the Advocate Commissioner shows that the building occupied by the bank is situated at a distance of more than 500 metres from the building owned by the respondent. According to PW2, the manager of the bank, the building occupied by the bank has got an area of 2140 sq.ft. There is no dispute with regard to the fact that it is situated in a panchayat area and not in a municipal area. The room occupied by the petitioner is situated in a municipal area. The Rent Control Court fixed the rent of the room at a rate 15% below the rent being paid by the bank.

8. Learned counsel for the petitioner contended that the court below should not have adopted the rent being paid by a nationalized bank as the basis for the fixation of the fair rent of a room taken on lease by a private party. We find force in this contention.

9. A nationalized bank may be in search of a building which is suitable for conducting its business in a locality. Buildings having the facilities required by the bank may be scarce in a particular locality. When the bank finds out a suitable building for its occupation, it would be willing to pay a higher rent for it. Very often it happens that the rent is fixed in such cases on negotiation between the parties concerned. The rent being paid by a nationalized bank for occupation of a building having large space may not reflect the prevailing rate of rent in the locality. Therefore, it will not be proper to adopt the same as the basis for fixation of the fair rent of a room occupied by a private party. Of course, in the absence of any other evidence with regard to the prevailing rate of rent in the locality, the court would be justified in adopting the rent being paid by nationalised banks and such other institutions as the basis for fixation of the fair rent of a building occupied by a private party, but only after making appropriate reduction.

10. When examined as PW2, the manager of the bank has given evidence that it was necessary for the bank to start an NRI branch at Kottakkal and the need of the bank for a suitable building was an important consideration in fixing the rent. Nothing more is required to find that the rent of the building occupied by the bank does not reflect the prevailing rate of rent in the locality.

11. In the instant case, the petitioner is occupying a r