Relevancy of market value of the building with fixation of fair rent of the building.

This Revision Petition is filed against the judgment and decree dated 24-7-1986 made in R.C.A. No. 50 of 1986 on the file of the VIII Judge, (Appellate Authority) Court of Small Causes, Madras.

2. The landlady, is the petitioner. The landlady filed an application under Section 4(4) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 for fixation of fair rent, in relation to a portion of the building (First Floor) of No. 29, Varada Muthiappan Street, George Town, Madras-1 which was let out to the respondent on a monthly rent of Rs.340/- The petitioner landlady claimed Rs.868/- as a fair rent. The respondent tenant opposed the petitioner on several grounds and the Rent Controller fixed the fair rent as Rs. 353/- by his order dated 8-4-1985. Aggrieved by the said order of the Rent Controller, the landlady filed the appeal R.C.A. No. 50/1986 and in that appeal, the rent was enhanced to Rs. 365/- per month.

3. Aggrieved by the appellate order dated 24-7-1986 made in R.C.A. No. 50/1986, the petitioner landlady has preferred this Revision Petition.

4. It is contended by the learned Counsel for the petitioner that both the Rent Controller as well as the Appellate Authority, have erred in fixation of quantum of fair rent under Section 4(4) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960, (hereinafter referred to as the Act). The learned Counsel for the petitioner in particular, referred to Section 4(4) of the Act, which is as follows:-

"4(4) The total cost referred to in sub-section(2) and sub-section (3) shall consist of the market value of the site in which the building is constructed, the cost of construction of the building and the cost of provision of any one or more of the amenities specified in Schedule I as on the date of application for fixation of the fair rent;

Provided that while calculating the market value of the site in which the building is constructed the Controller shall take into account only that portion of the site on which the building is constructed and of a portion up to fifty per cent thereof of the vacant land if any appurtenant to such building the excess portion of the land, being treated as amenity;

Provided further that the cost of provision of amenities specified in Schedule I shall not exceed-

(i) in the case of any residential building, fifteen percent; and

(ii) in the case of any non-residential building, twenty five percent, of the cost of the site in which the building is constructed and the cost of construction of the building as determined under this Section."*

The learned Counsel for the petitioner contended that both the Rent Controller and the Appellate Authority held in construing the term, 'building' to include 'the entire building'. Whereas as per the definition of 'building' given in Section 2(2) of the Act,

"(2)" Building

"means any building or hut or part of a building or hut, let or to be let separately for residential or non-residential purposes."*

So, upon the facts and circumstances of the case, part of the building alone ought to have been taken into consideration for calculating the market value. He also pointed out that it is an admitted case that the first floor was constructed in 1978 and the ground floor was constructed more than 25 years back. Therefore, landlady was entitled to depreciation calculated for five years as per Schedule II.

5. On the other hand, Mr. Mohan the learned Counsel for the respondent contended that there is no error with regard to the calculation of the market value both by the Rent Controller as well as the Appellate Authority, and the market value ought to be considered for the entire building irrespective of the age when the first floor was constructed.

6. There is force in the contention of the learned Counsel for the petitioner that the definition of the 'building' given in Section 4(4) of the Act, should not be given a common parlance meaning but meaning given under Section 2(2) of the Act. In the Buildings (Lease and Rent