2022 Supreme(Online)(KER) 59511
HIGH COURT OF KERALA
A. Muhamed Mustaque, Shoba Annamma Eapen, JJ
C.SIJU
– Appellant
Versus
BINDU KUYYALIL – Respondent
OP (RC) 14 2022
Important Points
Subject
Property Law - Lease and Rent Control
Act Referred
Headnote
Interest - Rent Arrears - Kerala Buildings (Lease and Rent Control) Act, 1965 - Sections 11(2)(a), 11(2)(b) - The court held that a landlord can claim interest on unpaid rent at 6% per annum from the date of the final order of fair rent fixation.
Fact of the Case:
A tenant challenged a Rent Controller order requiring the payment of rent arrears and interest, with the landlord claiming interest on a revised rent from a specified date. The case arose under the Kerala Buildings (Lease and Rent Control) Act, 1965.
Finding of the Court:
The court found that the tenant was liable for interest on the outstanding rent but only from the date of the court's order affirming the fair rent, not from the earlier date as claimed by the landlord.
Issues: The main issues were whether interest could be claimed together with rent arrears and, if so, from what date interest should accrue.
Ratio Decidendi: The court determined that default in payment is linked to the final determination of fair rent, indicating that interest starts from the date of that determination, not earlier.
Final Decision: The order for interest from 1.08.2012 was set aside, and interest was modified to start from 14.12.2018.
ZUBAIR PULIKKOOL, SIVASANKARAN T., U.K.DEVIDAS, K.K.ANILRAJ
J U D G M E N T
A. Muhamed Mustaque, J The tenant is before us. The tenant who is an Advocate clerk by profession is pitting against a lawyer of the same bar. The lawyer is the landlord. The interesting questions that have arisen for consideration by us are, i) whether the rent arrears can be claimed together with interest; ii) If interest can be claimed by the landlord, can the landlord claim interest for the revised rent based on the fair rent fixation by this Court with a retrospective date. These are the two questions to be decided in this original petition.
2. The questions are discernible from the operative portion of the order of the Rent Controller, which reads thus:
Seven Hundred and Twenty Nine only) which is the admitted arrears of rent for the period from 18.08.2012 to 18.01.2019 @ Rs.3077/- per month, along with interest @ 6% per annum from 18.08.2012 till the date of deposit, within a four weeks from today. The respondent shall also continue to pay or deposit the rent accrues in future.”
3. We shall advert to the first question in regard to the interest. The present proceedings arise from an order under Section 12(1)of the Kerala Buildings (Lease and Rent Control) Act, 1965 . The landlord filed eviction under Section 11 (2)(a) and (b), alleging default of payment of rent. The mandatory notice preceded the petition. The claim of the landlord is that the tenant defaulted on the enhanced rate based on the fair fixation order from 1.08.2012 onwards. The fair rent was finally fixed by the order of this Court in revision on 13.11.2018. The tenant is not disputing his liability to pay the fair rent from 2012 onwards. The tenant's case is that he is not liable to pay the interest on the revised rent from 2012 onwards. According to the tenant, he is liable to pay interest for the defaulted amount only after the disposal of the revision by this Court on 13.11.2018.
4. As seen from Section 11 (2)(a) and 11(2)
(b) proviso, the landlord is entitled to claim interest at the rate of 6% per annum, if the tenant has failed to pay the rent. It is appropriate to refer Section 11 (2)(b) and the proviso therein.
“xxxxxxx (b)If the rent Control Court, after giving the tenant a reasonable opportunity of showing cause against the application, is satisfied that the tenant has not paid or tendered the rent due by him in respect of the building within fifteen days after the expiry of the time fixed in the agreement of tenancy with his landlord or in the absence of any such agreement by the last day of the month next following that for which the rent is payable, it shall make an order directing the tenant to put the landlord in possession of the building, and if it is not satisfied it shall make an order rejecting the application thereof by him:
Provided that an application under this sub-section shall be made only if the landlord has sent a registered notice to the tenant intimating the default and the tenant has failed to pay or tender the rent together with interest at six per cent per annum and postal charges incurred in sending the notice within fifteen days of the receipt of the notice or the refusal thereof.”
5. The proviso clearly indicates that the landlord is entitled to claim interest at the rate of 6% per annum for the defaulted rent. This view also has been supported by the judgment of this Court inGopala Panicker Baiju and Another v. Mallika [ 2018 (5) KHC 95 ] and in Kuruvila v. Sainabha Saleh [ 2006 (4) KLT 138 ]. We have no hesitation to hold that the tenant is liable to pay interest for the defaulted rent at the rate of 6% per annum.
6. The next question in this case is as to whether the tenant is liable to pay interest at the rate of 6% from 1.08.2012 onwards. The revised fair rent admittedly is liable to be paid by the tenant from the due date onwards. The revision was disposed only on 13.11.2018. The fair rent fixation finally culminated in the