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1998 Supreme(P&H) 1240

PUNJAB & HARYANA HIGH COURT
V.S.Aggarwal, J.
Tikka Ram
Versus
M/s.Chhina Industries
Civil Revision No. 2770 of 1997,
Decided On : SEPTEMBER 29, 1998

Payment of rent by demand draft is valid if agreed upon by the parties, and arrears of rent cleared before filing of eviction petition is no cause of action for eviction.

Headnote:

RENT CONTROL - PAYMENT OF RENT - DEMAND DRAFT - VALIDITY - EAST PUNJAB URBAN RENT RESTRICTION ACT, 1949 - SECTION 13(2)(I) - INTERPRETATION - PAYMENT OF RENT BY DEMAND DRAFT IS VALID IF AGREED UPON BY PARTIES - ARREARS OF RENT CLEARED BEFORE FILING OF EVICTION PETITION - NO CAUSE OF ACTION FOR EVICTION.

Fact of the Case:

Landlord filed an eviction application against tenants for non-payment of rent. Tenants contested the application, claiming that rent was not payable in advance and that they had sent a demand draft for the arrears of rent, which was encashed by the landlord. The trial court held that the rent was due and that the tenants were liable to be evicted. The Appellate Authority, however, held that the payment of rent by demand draft was permissible and that the arrears of rent had been cleared before the eviction petition was filed, and dismissed the petition.

Finding of the Court:

The court held that the payment of rent by demand draft was valid if agreed upon by the parties, and that the arrears of rent had been cleared before the filing of the eviction petition, and therefore there was no cause of action for eviction.

Issues: 1. Whether the rent was payable in advance? 2. Whether the payment of rent by demand draft was valid? 3. Whether the arrears of rent had been cleared before the filing of the eviction petition?

Ratio Decidendi: 1. The court held that the parties can agree as to if the rent is to be paid in advance or not, but in the present case, the agreement to pay rent in advance was not registered and therefore could not be received in evidence. 2. The court held that the payment of rent by demand draft is valid if agreed upon by the parties, and that in the present case, there was an implied agreement to accept payment by demand draft. 3. The court held that the arrears of rent had been cleared before the filing of the eviction petition, and therefore there was no cause of action for eviction.

Final Decision: The court dismissed the revision petition.

Judgment

V.S.Aggarwal, J.

1. Tikka Ram and another, hereinafter described as the petitioner, has filed the present revision petition directed against the judgment of the Appellate Authority, Chandigarh, dated 18.1.1997. By virtue of the impugned judgment, learned Appellate Authority accepted the appeal of the respondent-tenants and dismissed the petition for eviction filed by the petitioners.

2. The relevant facts are that petitioners filed an eviction application against the respondents asserting that the agreed rent was Rs. 2,150/- per month (excluding water and electricity charges). The arrears of rent amounting to Rs. 49,450/- were due and that the rent was payable in advance by 7th of each month. The other grounds of eviction had been taken but do not survive for the purpose of present revision petition. The respondents contested the eviction application and contended that the rent was not payable in advance. The rent was being refused by the petitioners. It was sent by demand draft of Rs. 49,450/- dated 26.7.1993 and it was encashed by the landlord.

3. The learned trial Court had framed the issues and held that the rent claimed was due and on that ground that respondents were liable to be evicted. The learned Appellate Authority, on the contrary, held that the payment of rent by cheque was permissible and, therefore, demand draft was also a good payment. Once the payment of arrears of rent had been made, learned Appellate Authority took note of the fact that no arrears were due when the petition was filed and, therefore, respondents were not liable to be evicted. The appeal as such was allowed. Aggrieved by the same, the present revision petition has been filed.

4. The first and the foremost question agitated was about as to if the rent was payable in advance ? There is no controversy that parties can agree as to if the rent is to be paid in advance or not. Reliance on behalf of the petitioners was placed on the agreement Mark A to urge that it had been agreed between the parties that the rent is to be paid in advance. To this, objection obviously was taken that it is an unregistered document and, therefore, it cannot be read in evidence.

5. The objection of the respondent is well taken because under Section 49 of the Indian Registration Act, the document could not be received in evidence of any transaction affecting such property unless it was registered. It was not being disputed by either side that the document did require registration. Thus, it could not be received in evidence of any transaction affecting such property.

6. Reliance to proviso to Section 49 of the Indian Registration Act is totally misplaced. It was urged that it could be seen for collateral purposes and thereupon it can also be looked into that payment was to be made in advance. Indeed, the agreement which states that payment was to be made in advance pertains to transaction affecting the property or conferring some power under the lease agreement. It cannot be termed to be a collateral purpose. This contention of the learned counsel is, therefore, devoid of any merit.

7. It is not being disputed that a demand draft of Rs. 49,450/- had been sent. The same had been encashed by the landlord. In the application for eviction, the arrears claimed were also of Rs. 49,450/- only. The Supreme Court in the well known decision rendered in the case of Damadilal and others v. Parashram and others, AIR 1976 SC 2229 : 1976 RCR 564 had considered this controversy. It was held that it is well established that payment can be made by cheque and once rent is sent and accepted, it would be good discharge of the rent. In paragraph 13 of the judgment, Supreme Court held as under :-

".....It is well established that a cheque sent in payment of a debt on the request of the creditor, unless dishonoured, operates as valid discharge of the debt and, if the cheque was sent by post and was met on presentation, the date of payment is the date when the cheque was posted. The quest











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