Requirements for fixation of fair rent of a building.

M.N. Chandrukar, C.J.

1. All these three revision petitions two of which are by the tenant and one by the landlord, raise a question with regard to the correctness of the fair rent fixed in respect of premises which are situated on the Mount Road, Madras, with a built up area of 18,047 sq. ft., 13,967 sq. ft., are covered by Go-down and 4,080 sq.ft. are covered by office premises.

2. The original agreed rent was Rs. 3,000 per month. The landlord filed an application for fixation of fair rent claiming Rs. 18,000 per month. The Rent Controller fixed the fair rent at Rs. 6,801 per month. Against this order both the landlord and the tenant went in appeal. The tenant's appeal came to be dismissed. The landlord appeal came to be allowed partly and the fair rent was fixed at Rs. 9,825 per month. Since the appellate order was passed in two appeals, one by the tenant and the other by the landlord, two revision petitions came to be filed by the tenant being C.R.P. Nos. 2491 and 2492 of 1983. Strictly speaking, since there is a common order, which arises out of proceedings started only on one petition, two revision petitions do not appear to be necessary at all and it would have been perfectly permissible for the tenant to file only one civil revision petition.

3. In C.R.P. No. 178 of 1984, the landlord has challenged the reduction of its claim inasmuch as the rent originally asked by it has not been fixed as fair rent. Substantially the two points on which parties seem to be at issue relate to the cost as estimated by the Appellate Authority in respect of basic amenities and Schedule I amenities. In respect of basic amenities, the Rent Controller had estimated the cost to be 10 per cent of the cost of construction. This was enhanced to 15 per cent by the Appellate Authority. In respect of Schedule I amenities, the Rent Controller had arrived at an ad hoc figure of Rs. 10,000 which was, however, enhanced by the Appellate Authority at Rs. 46,788 being 5 per cent of the cost of construction. Now, so far as the basic amenities are concerned, which are in the nature of facilities for water supply, electrical fittings and the drainage system, the Rent Controller has merely observed that he was inclined to award 10 per cent of the cost of construction as the value of the amenities. Now the Rent Controller himself has come to the conclusion that the cost of construction at the rate of Rs. 32 per sq. ft. would come to Rs. 27,750. In so far as the basic amenities are concerned the relevant provision of law is in Section 4(5)(a) of the Tamil Nadu Buildings (Lease and Rent Control) Act, which provides that the cost of construction of the building including cost of internal water-supply, sanitary and electrical installations shall be determined with due regard to the rates adopted for the purpose of estimation by the Public Works Department of the Government for the area concerned. A further discretion is, however given to the Rent Controller in appropriate cases to allow or disallow an amount not exceeding 30 per cent of the cost of construction having regard to the nature of the cost of construction. I am informed that, so far as the Public Works Department rates are concerned, the maximum rate with regard to the basic amenities referred to in Section 4(5)(a) of the Act is 22-1/2 per cent, allocated as 7-1/2 per cent in the case of water supply, 7-1/2 per cent in the case of sanitary fittings and 7-1/2 per cent for electrical installations. Now it is obvious that the cost of construction which is to be determined is with reference to the time of pendency of the proceedings, because under Clause (b) of sub-Section 5(a) of Section 4 of the Act, a depreciation has to be calculated. The best method would have been to find out what exactly is the cost which has to be incurred for purpose of making available the basic amenities. Since the statute itself indicates that the guideline is to be the rate adopted for the purpose of estimation made by the Pu