Jaoharali vs Kusum Ingots & Alliances Ltd.

Judicial Analysis Court Copy Headnote Facts Arguments Court observation

Advocates Appeared:
For the Appellant : M. Dalal
For the Respondent: S.C. Bagdia

Headnote:Accommodation Control Act, 1961 (M.P.) – S.13(1), 13 (2), 7 and 10 – dispute as to rate of rent – civil Court cannot assess the rent according to provisions under S. 7 and 10 – assistance of S. 13 (1) has to be taken – agreed rent to be fixed as provisional rent.
        Short Note
       The contention of the learned counsel for the plaintiff – landlord (applicant here) is that in exercise of powers under S. 13 (1) of the Act the Court could direct the payment of the amount on the basis of the rate of rent last paid, the Court had no power to reduce the rent. As against it, the learned Counsel for the defendant – non – applicant by making reference to S. 5 and 7 (1) (c) of the Act, submitted that it is the standard rent which was directed to be paid.
       2. Held: A plain reading of the said section 13 (1) would show that the tenant shall within one month from the service of the notice on such further time that may be allowed by the Court to deposit the amount calculated at the rate of rent at which it was paid. It is significant to note that the legislature has used the word 'amount' and the rate of rent has been used for the purpose of calculation of the amount. What the law requires is that the tenant is required to deposit an amount at the rate of rent, which was paid by him. This is not in dispute in both these cases that the defendants paid the rent @ of Rs. 20,000/ – per month. Thus, the last paid amount would be Rs. 20,000/ – per month.
       3. This Court was taken to the record, a deed of agreement, in each case has been produced in the trial Court. It has been signed by the defendant – tenants, there is no dispute as to the execution of the document. The document itself speaks of the rent of Rs. 20,000/ – per month. Thus, in such a situation what the tenant was required to make deposit was the amount of the rent calculated on the basis of the rate of rent last paid.
       4. The legislature has used the word 'rent' in S. 13 (4) of the Act only for calculation of the amount and for the purpose of knowing the rate at which the tenant used to pay the rent prior to the institution of the suit. Section 5 of the Act, no doubt, provides that the rent in excess of the standard rent cannot be recovered. This is not in dispute that in this case the premises was a new construction and prior to the letting the same to the present defendant non – applicant it was let out to the Canara Bank.
       5. Section 7 (3) of the Act provides that where an accommodation is not assessed as per the provisions of S. 7 (1) & (2) of the Act, the standard rent would be calculated on the basis of the annual rent calculated with reference to the rent agreed upon between the landlord and the tenant when such accommodation is first let out, and if it has not been so let out, to such amount for which it could be let out immediately after its construction was completed. The annual rent calculated on the basis of annual payment of an amount equal to 6 3/4 per cent per annum of the aggregate amount of the actual cost of construction and the market price of the land comprised in the accommodation on the date of the commencement of the construction, whichever is leS.
       6. Section 10 of the Act provides a procedure and forum for fixation of the standard rent. It appears before filing of the suit, no such action was initiated by the defendant – tenant, nor any order of the Authority has been obtained in respect thereof. Now, therefore, in view of the provisions of S. 13 (1) of the Act, the defendant – tenants would be required to pay the amount calculated at the rate of rent last paid, which shall be Rs. 20,000/ – per month.
       7. It appears that learned trial Judge has not considered the provisions of S. 13 (1) of the Act and assumed powers under S. 5, 7 and 10 of the Act (not vested in him) for fixation of the standard rent. It is clearly wrong and against the principles of law. Thus, learned trial judge has exercised the jurisdiction not vested in him.
       8. In view of the discussion above, these revisions deserve to be allowed, hence it is allowed. The order of the trial Court is set aside. The defendant – tenants are directed to depost the amount at the rate of Rs. 20,000/ – (Twenty Thousand) per month, within 30 days from today. In the facts and circumstances of the case, the parties to bear their own costs.

Jaoharali vs Kusum Ingots & Alliances Ltd. - 1996 Supreme(MP) 1339