Judgment :- 1. The revision petition by the tenant invites investigation into the core of the concept of fair rent under the Kerala Buildings (Lease and Rent Control) Act, Act 16 of 1959, replaced by Act 2 of 1965, for short called the Act. 2. A room (hereinafter referred to as Door No. 322) had been let for Rs. 35/-per month by the respondent to a certain tenant in a commercially important area in Trichur. That tenant surrendered the building and, after keeping it for a couple of months, the landlord re-let it to the petitioner in 1957 on a monthly rent of Rs. 100/-. Thus, there was a jump from Rs. 35/-to Rs.100/-in the price of the letting. The municipal assessment proceeded on a net annual value worked out on the basis of Rs. 35/- per. mensem (Ext. P1) as the rent of the premises till 1961 (Ext. D2), when it was revised, on the basis of a monthly rent of Rs. 100/-(Ext. D6). The petitioner continued to pay at the rate of Rs. 100/-till 1963 when he moved the Rent Control Court for fixation of fair rent alleging that what was being collected from him was unconscionable, that at the time of letting he had really no option but to agree to the rather extortionate demand of the landlord, that the rent was so high that he found it very difficult to pay and that he was entitled to mitigation by assessment of fair rent, even against his own unwilling agreement to pay Rs. 100/-. The landlord, on the other hand, extolled the virtues of his building by way of commercial importance of the place and went to the extent of stating that it was by way of concession that a low rent of Rs. 100/- per month was fixed, although its real rent would have exceeded Rs. 200/-. There is a history of litigation for arrears of rent between the landlord and the tenant (O. S. No. 568 of 1963) which probably was the immediate provocation for the fair rent application. 3. Evidence has been let in to show that the municipal authorities had, acting under S.100 (2) of the Kerala Municipalities Act, 1960, Act 14 of 1961, taken Rs. 100/-as "the rent that may reasonably be expected". The landlord also pressed into service Ext.
3. Evidence has been let in to show that the municipal authorities had, acting under S.100 (2) of the Kerala Municipalities Act, 1960, Act 14 of 1961, taken Rs. 100/-as "the rent that may reasonably be expected". The landlord also pressed into service Ext. D5, a rent chit dated 1-6-1961, executed by the tenant of a room adjacent to the disputed premises and somewhat similar in dimensions, wherein Rs. 101/- per mensem was fixed as the rent. In the same locality the municipality has constructed some rooms and according to the landlord R. W.1, the rent of the municipal rooms (which are, according to him, smaller than his Door No. 322) is per room, Rs. 555/-per mensem in 1965. It has also been brought out is the testimony of R. W.1 that the situation of the room in question, Door No. 322, is in a busy area where the municipal bus-stand and the telephone exchange are located and the Railway Station road joins the municipal office road. In short, the landlord relied upon the prevalence of high rentals for similar accommodation in the locality and also the increase in the commercial importance of the place as justifying what he describes as the moderate of Rs. 100/-. The tenant, on the other hand, sought refuge in a circumstance very damaging to the landlord. Door No. 317 is a room adjacent to the disputed premises (No. 322) in the occupation of and owned by the landlord. The Rent Control Court has summarised the evidence bearing upon the municipal assessments and rents of these two rooms in the following words: "The respondent-landlord admits that door no. 317 adjacent to the disputed premises now in his occupation, is double in size than door No. 322 in the petitioner's occupation. Door No. 317 is also in a more important place than door No. 322. The municipal assessment in respect of door No. 317, as will be seen from Ext. P1, is much less than the assessment in respect of door No. 322 in the petitioner's possession. He would urge that the municipal assessment in relation to door No. 322 should be half of what is assessed for No. 317. If door No. 322 is only half of No. 317, then this argument of the petitioner would have considerable force.
P1, is much less than the assessment in respect of door No. 322 in the petitioner's possession. He would urge that the municipal assessment in relation to door No. 322 should be half of what is assessed for No. 317. If door No. 322 is only half of No. 317, then this argument of the petitioner would have considerable force. Not only that the assessment of door No. 317 is not double that of No. 322 but that the assessment is lower than that of No. 322. This standard of municipal assessment does not reconcile with any reasonable view of things. R. W. I says that the rental value of door No. 317, as assessed in Ext. D6, is very fair. Assume it is correct. Door No. 317 is double in size than No. 322. Hence the municipality should have assessed 322, which is slightly remote from 317, at a lesser rate. There is no convincing explanation offered for the respondent for this arbitrary enhancement of the assessment for 322." 4. All the three Courts have rejected the tenant's plea and upheld the landlord's right to Rs. 100/-per mensem. The question that confronts the revisional Court is as to whether there is anything illegal, improper or materially irregular savouring of jurisdictional infirmity, in the findings of the Courts below. 5. The arguments which appealed to the three Courts have something basically common in them, although there is definitely some divergence in approach. The Rent Control Court seemed to rest its conclusion largely on the municipal assessment while the appellate and revisional Courts took note of the general conditions, including the inflationary spiral prevailing in the country and the special features of the area, and found the current rent levied by the landlord to be reasonable. 6. S.5 of the Act, is the provision for determination of fair rent. The Act of 1959 (Kerala Act 16 of 1959 as amended by Act 29 of 1961) ran as follows: "5. Determination of fair rent, (i) The Rent Control Court shall, on application of the tenant or landlord of a building, fix the fair rent for such building after holding such enquiry as it thinks fit.
The Act of 1959 (Kerala Act 16 of 1959 as amended by Act 29 of 1961) ran as follows: "5. Determination of fair rent, (i) The Rent Control Court shall, on application of the tenant or landlord of a building, fix the fair rent for such building after holding such enquiry as it thinks fit. (2) In fixing the fair rent court shall take into consideration the property tax or house tax fixed for the building at the time of letting in the property tax register or house tax register of the local authority within whose area the building is situated: Provided that in the case of (i) any residential building, or (ii) any non-residential building, excepting a building to which fittings have been affixed and such fittings have been excluded from valuation for the purpose of fixing the property tax or house tax by a local-authority, the fair rent fixed may in proper cases be lower than, but shall in no case exceed by more than 15 per cent, the monthly rent on the basis of which the property tax or house tax for the building has been fixed. (3) If there is no property tax or house tax fixed for the building or if it is not based on a rental basis or if the building is situated in an area which is not a City, Municipality, Panchayat or in any other local authority, the fair rent shall be fixed after taking into consideration the prevailing rates of rent in the locality for similar accommodation in similar circumstances during the twelve months preceding the letting." "Unconscionable rent" has been defined. "Unconscionable rent" means any rent which is more than double the maximum of the fair rent that could be fixed for a building under S.5 and S.29 (2) makes it penal to levy an "unconscionable rent". While S.8 forbids the landlord from claiming or collecting anything else than fair rent where it has been determined, S.6 and 7 regulate the increase in fair rent and payments on account of increase in local rates, taxes and cesses. 7. S.27 to 30 of the Act provide for prosecution of landlords who levy unconscionable rents and for fixation of fair rents without an application by the tenant, although, paranthetically, I may agree that these catalytic provisions, if I may so describe them, have been kept in cold storage all these years.
7. S.27 to 30 of the Act provide for prosecution of landlords who levy unconscionable rents and for fixation of fair rents without an application by the tenant, although, paranthetically, I may agree that these catalytic provisions, if I may so describe them, have been kept in cold storage all these years. The anxiety of the State to hold in leash the runaway proclivities of rents in a scarcity economy serves as the legislative perspective of rent restriction statutes. In this connection, it may be noticed that the Act does not set out all the relevant factors bearing upon the fixation of fair rent, although it does direct the Court to hold an enquiry, presumably, into the pertinent factors and take into consideration the property tax or house tax fixed for the building at the time of letting. The Act has fixed ceiling in the sense that fair rent should not exceed, by more than 15% the monthly rent on the basis of which the property tax or house tax for the building has been fixed. It is interesting; to note that in the Madras Buildings (Lease and Rent Control) Act, 1949 (Act 25 of 1949) the basic monthly assessment adopted was the one current during 1939-40 i. e. the last pre-war year. In the Kerala Act the rental value in the Municipal registers and in its absence, tents for similarly circumstanced accommodation as at the time of letting was substituted, but on account of the decision of a Full Bench of the Kerala High court reported in Kunhammed Koyi v. Premalatha (1962 KLT 366) which held that for purposes of ceilings on rentals the municipal rental value at the time of the filing of the application, should govern the case, as distinguished from such rental value as at the time of the letting, the legislature apparently felt that its intention, as gatherable from the language of the statute, was different from what It had in mind and set it right by a later amendment (Act 7 of 1966) where by the relevant year for fixing ceilings on rents was taken to be two years prior to the date of the application May be the possible abuse by landlords manipulating the municipal assessments behind the back of the tenants could thereby be avoided. 8.
8. A fine-spun line of thought often forgotten but fundamental to the rent restriction scheme, deserves mention here. The primary object of this class of legislation is not so much to adjust, on considerations of equity, the rent. payable to a landlord by a tenant in particular cases as to limit the rights of the landlords as a class to increase the rent and obtain possession of premises, so as to ensure the peaceful of the indiscriminate eviction and rack-renting which also ends up in eviction Social unrest will be the product of unbridled eviction and unchecked rise in rentals; social defence through social control, as distinguished from meting out economic justice between parties in individual cases, of the purpose of the legislation by and large. If the individual case is the local point, factors like the relative economic circumstances and needs of parties the large benefit derived by a particular tenant in occupation of premises even by reason of scarcity of accommodation in the locality and a share for the landlord therein etc., may become important consideration but, if we are principally concerned with maintenance of peaceful conditions in society keeping down rentals generally by inhibiting the very social tendency to evict and raise rents indiscriminately by pegging them to some basic figure and regulating their rise, will be the approach.In one case we treat the individual disease; in the other, we device prophylactic procedures to control a socio-pathological condition. In this case, the Courts below have missed this shift in emphasis, if I may say so. Consequently the appellate and revisional Courts have falle in to a few but fundamental errors, as I will presently show. Fair rent is not always what is fair between a particular landlord and his tenant, considering their relative economic circumstances. Fair rent is not what a tenant has acquiesced in for reasons of prudence but what the prescribes to be fair inspite of his consent to pay the higher rent. That cannot acquiesce away your right to fix fair rent is basic to this type of legislation. (vide theimplication of S.27 to 30 of the Act) 9.
Fair rent is not what a tenant has acquiesced in for reasons of prudence but what the prescribes to be fair inspite of his consent to pay the higher rent. That cannot acquiesce away your right to fix fair rent is basic to this type of legislation. (vide theimplication of S.27 to 30 of the Act) 9. Before I proceed further, I must refer to the reliance placed by the tribunals in this case on the fact sworn to by the landlord as R. W.1: "that near-about this building the municipality has constructed some rooms and that the disputed room is larger in area than the said rooms." and further that "The rent of the municipal rooms is Rs. 555 per mensem." It is regrettable if these facts are true that a local authority like the Trichur Municipality should appear to be guilty of collecting unconscionable rents. The State and its subsidiary agencies should set an example by charging reasonable rentals in obedience to the Law, lest the people should lose faith in the rule of law and socio-ethical foundation of the law How can one compliment the municipal council on charging Rs. 555/- per month for accommodation which, according to the rent control law and in the light of the evidence in this case, may not fetch a fifth fraction of it by way of fair rent, unless it be that the evidence in this case is unreliable and there are other facets not brought out? And the vice is more vicious when we remember that these bloated figures become data for fixing fair rents for other buildings. Another circumstance relied upon in the case, but this time by the tenant, is the estimate by the municipal authorities of a lower letting value for the building (No. 317) adjacent to the one in dispute (No. 322) leading to the inference that a public body has assessed tax on the basis of annual rental values fixed with an unequal eye and an uneven hand. As things stand now, all that I need say is that the municipal records in this case are found to be unreliable to decide the issue of fair rent. 10. The Courts in this case have been carried away also by some other circumstances. The tenant had been continuing to pay rent at the rate of Rs.
As things stand now, all that I need say is that the municipal records in this case are found to be unreliable to decide the issue of fair rent. 10. The Courts in this case have been carried away also by some other circumstances. The tenant had been continuing to pay rent at the rate of Rs. 100/- without demur and so he must be deemed to have treated that figure as fair. Pushed to its logical conclusion, this argument would mean that wherever a tenant is not able to show that the rent was stipulated under duress or on account of fraud, he must be deemed to have accepted it as the fair rent. Such an approach would frustrate the scheme of rent control altogether, which is calculated to protect the tenant even against his own agreement, having due regard to the weaker position he occupies in a scarcity situation. Again, Ext. D6 which relates to a somewhat similar building stipulates for a rent of Rs.101/- per mensem in 1961. One should not exaggerate the importance of this document because the fact that the executant of Ext. D5 has suffered a high rent for practical considerations, cannot make it a standard of fairness for the locality unless we investigate the conditions in which Ext. D6 came to be executed. Nor can it be said that 1951 is the basic year. It is the year of letting that has been adopted as the basic year under our Act even as it is the last pre-war year which has been adopted as the basic year by the Madras Act. There is reference in the judgment under consideration to "the great fall in the value of money which certainly has inevitable repercussions upon the rate of rent, price level etc., the increase in the business activities of the town, the rise in importance of the particular locality, etc." The courts have, as a result of considering these circumstances, concluded that "the argument of the learned counsel that for a premises which was fetching Rs. 35/-, the stipulation to pay a higher rent of Rs. 100/-was exorbitant and unreasonable loses all its importance". The fallacy in the approach is what I have pointed out above. The question is not whether the tenant is benefiting considerably from use of the building.
35/-, the stipulation to pay a higher rent of Rs. 100/-was exorbitant and unreasonable loses all its importance". The fallacy in the approach is what I have pointed out above. The question is not whether the tenant is benefiting considerably from use of the building. The real point is the social policy of the legislation, of pegging the rentals of accommodation to an anteriorly prevalent rate and allowing, under controlled conditions, moderate increases on legitimate grounds unrelated to scarcity of housing. The basic year in our statute is the year of letting which, in this case, is 1957. We are not concerned whether the landlord is entitled to get a share in the profits accruing to the tenant on account of the rise in importance of the locality etc. although that fact may become material if, as explained by me later, a willing tenant may offer a higher rent for reasons of importance of the locality unconnected with shortage of buildings. The fall in money value may be borne in mind to a restricted extent, of course, but not to defeat the object of these legislative measures like rent control laws which aim at resisting the erosion of the real value of money by holding the price line of essential things, including housing rents. We are really concerned only with the formula for fixing the fair rent which the legislature, in its wisdom and within its constitutional powers, has set. 11. The statute has directed the Courts to have due regard to the municipal evaluation of the rental value. Even here, little assistance is available in this case because the annual letting value has been arrived at merely by adopting the actual rent of Rs. 100/- the petitioner was paying and not by basing it on what might be expected reasonably, if let to a free agent, as it were. If the municipal authority adopted what the tenant was paying, it is begging the question or moving in a vicious circle to press that into service in an enquiry as to whether what is being paid by the tenant is fair rent. Moreover, there is a serious limitation on the extent to which one may rely on municipal rental value for fixing fair rent, particularly after the Full Bench decision and the amendment of S.5 by Act 7 of 1966.
Moreover, there is a serious limitation on the extent to which one may rely on municipal rental value for fixing fair rent, particularly after the Full Bench decision and the amendment of S.5 by Act 7 of 1966. A direct incentive to push up the annual letting value in the municipal tax records is furnished to the landlord. And the tenant does not have a statutory say in it when the local authorities decide the 'reasonable rent' for which it is expected to be let. Bearing in mind these drawbacks the Court will, nevertheless, use the rental value in the tax register at the time of letting; for, that is the mandate of the statute. The ceiling, however, is set with reference to the letting value as entered in the tax register two years before the date of the application. This prescription deprives the clever landlord, who successfully colludes with taxing authorities, of immediate dividends from boosting the monthly rent for house tax purposes. 12. The Act requires the Court to take into consideration the rental value assessed by the municipal authorities for house tax purposes, but it is significant to note that what the Court is asked to look into is such rentals as at the time of letting and not as at the time of the application, nor what prevailed two years prior to the date of the application. We cannot confuse between the two points of time mentioned in S.5 (2). What is declared as relevant for fixing fair rent is rental value at the time of letting. What is declared as a ceiling is the monthly rent, on the basis of which the property tax or house tax for the building, prevailing two years before the date of the application was filed, plus 15% thereon. It is not as if the Court must always give the maximum as is abundantly clear from S.5 (2) itself. Indeed, S.5 (3) almost suggests that the prevailing rates of rent in the locality for similar accommodation in similar circumstances at about the time of letting is to be taken into only when these is no property tax or house tax fixed for the building or if it is not based on a rental basis or if the building is situated in an area Where there is no local authority.
Even here, rents of similar accommodation during the 12 months preceding the letting and not preceding the application or at any other intermediate period that is made relevant. I emphasise that the cumulative result of the various considerations set out above is that we are to take into consideration primarily the circumstances prevailing at the time of letting and not later developments except to the limited extent of finding out whether any increase should be given on account of fittings and furniture gardens and improvements which do not ordinarily enter the reckoning for municipal tax purposes: One way also take due note of natural factors having an impact on rentals as distinguished from artificial factors which savour of exploitation of scarcity. 13. It is necessary in this context to refer to two rulings of the Kerala High Court reported in Kunhammed Koyi v. premalatha (1962 KLT 366FB.) and Auto -Transport Union (P) Ltd. v. Cardamom Marketing Co. Ltd. (1966 KLT. 1063). We first one, a Full Bench decision; was really concerned with the construction of the proviso to S.S, in particular, the connotation of the word" has been fixed" and the point of time Which it relates to However, :the following observations in the judgment have a bearing on the subject under Consideration; "The object of S.Sof the Act is avowedly to fix the fair rent, which; we take it; is the rent which a willing tenant would have paid to a willing landlord had not abnorman': conditions introduced a measure of conclusion enabling landlords to force unfair bargains on tenants." In individual circumstances an unfair advantage may be gained by a tenant in occpation on a rent "which though fair enough during pre-war times would be too low today even if. scarcity conditions, did not prevail, having regard to the-general fall in the value of money" Minor adjustments to antidote this unfairness are permissible under the proviso to S.5(2) of the Act, as I see it. However, the full Bench further' observes: "Under sub-section (1) of the section the Rent control court is to fix the fair rent after holding such enquiry as it thinks fit.
However, the full Bench further' observes: "Under sub-section (1) of the section the Rent control court is to fix the fair rent after holding such enquiry as it thinks fit. Considerations such as the capital cost of the building so as to provide a reasonable return for the landlord it is certainly, not the object of the statute to discourage building and the prevailing rates of rent in the locality for similar accommodation would enter into the computation, and, since the object is to rule out the increases brought about by scarcity conditions the reasonable rent at the time of the letting Would also be a relevant consideration so long as allowance could be Made for such matters as the rise or fall in the value of money after the time of letting. Even so, the more relevant consideration would be the rent prevailing immediately before the scarcity. conditions arose (S.4 (2) (a) and (b) of Madras Act XXXV of 1949 which the present Act replaced, makes the rent prevailling during the 12 months prior to the 1st April 1940 the basis); but, so long as the reasonable rent prevailing at the time of letting is only one of the considerations in fixing the fair rent and not the sole consideration due allowance could be made for the change in conditions since the time of the letting so that no hard ship would b2 caused. But, as we, shall presently show, if it is to be the sole consideration for 'fixing a ceiling, the result in many cases would be anomalous and unfair." I am free to confess that there is some difference in approach, but no essential; divergence, between what I have indicated as my reasoning and what is gather able from the excerpt extracted above. Dealing with municipal assessments and their utility in fair rent fixation the Court observed: "Under S.82 of the Madras District Municipalities Act which governs the matter so far as the present case is concerned (and which is illustrative of the provisions in the enactments governing other local authorities) the annual value of a building on the basis of which tax is assessed is the gross annual rent at which the building may reasonably be expected to 1st from month to month or from year to year.
This annual value is fixed after due enquiry and therefore it is reasonable to assume that the value so fixed by a statutory authority represents the rent at which the building may reasonably be expected to let. When the value fixed is too high the owner of the buildings, namely the landlor would naturally complain since the tax levied on him would be correspondingly high; and he can obtain redress by an appeal. If it is too low, it would be something in which the landlord has acquiesced to his advantage in the shape of a lower tax so that there would be nothing improper or unfair in holding him to that value. No doubt one does not ordinarily expect a person to complain against a low assessment, but if, in fact, the municipal assessment is too low, a landlord could readily have it corrected. But, if he acquiesces in it to his advantage, and, for the purpose of taxation is content with a low assessment of the rent, there is perhaps nothing wrong in asking him to be content with that low assessment for the purpose of collection from the tenant. The Municipal assessment is thus a fair and ready means of discovering what is the reasonable rent for a building at any particular time." One more observation of their Lordships in that case is worth quoting: "As we have already stated, the object of the statute is to relieve against unreasonable increases in rent following upon the abnormal conditions created by the Second World War, not to clamp the rents down to what was prevailing at the origin of each tenancy. A relevant consideration for conclusively determining the maximum rent might be the rent prevailing in 1939, just before the war broke out. But it cannot be the rent prevailing when each tenancy began. By way of example (and the example is not a mere theoretical possibility there must be numerous cases approximating to it) take the case of two twin houses situated side by side, built at the same time and at the same cost, identical in every matter which has the least relevancy in determining what should be the fair rent, but belonging to different persons. Supposing both were let at a monthly rent of Rs. 50/-in 1939, this being the rental value as entered in the municipal assessment for the year.
Supposing both were let at a monthly rent of Rs. 50/-in 1939, this being the rental value as entered in the municipal assessment for the year. The rent of both is raised to the same extent from time to time until in 1960 each is fetching a rent of Rs. 150/-, this being the rent entered in the municipal register. In one house the same tenant has been in continuous occupation. But, in the other, there is a change in 1960. Both tenants apply for the fixation of fair rent, and, after the due enquiry enjoined by sub-section (1) of S.5 of the Act, after taking into consideration the tax fixed (in truth the rent on which the tax is fixed) at the time of the letting as required by sub-section (2), the Rent Control Court comes to the conclusion that the fair rent for both would be Rs. 100/-(Ex hypothesi there could be no question of the fair rent for the two being different). In the case of the house in which there has been a change in the occupant, this, namely, Rs. 100/-would be the fair rent fixed. But in the case of the building where there has been no change the fair rent would have to be fixed at Rs. 57-70 having regard to the upper limit prescribed by the proviso. This would be a discrimination against persons similarly situated. It would have no bearing whatsoever on the object of the statute." But all this is about the maximum. In the later decision Vaidialingam J. reiterated what the Full Bench had decided and adverted to the usefulness of municipal assessments in this context. Before concluding, let me point out that there are difficulties in understanding and applying the provisions of S.5, viewed conceptionally or functionally. If the normal year is the basis for arriving at the fair rent today, the Madras Act was nearer the mark with the last pre-war year than the Kerala Act which makes the year of letting which may be as early as 50 years ago or as late as last year and imports an arbitrary element the standard year. And if the year of letting is after the era of scarcity has set in, the impact of abnormal conditions would inevitably be there for that year.
And if the year of letting is after the era of scarcity has set in, the impact of abnormal conditions would inevitably be there for that year. Even regarding the maximum, the Act adopts the monthly rental, according to house tax registers, for the period two years immediately preceding the date of application. We must remember that once fair rent is fixed it cannot be further increased (except where improvements have been made). And if two similar buildings, so good in condition that the maximum permissible is deserved by both, are the subject of fair rent applications one in 1960 and the other in 1969 the results would be different almost necessarily. Because the fair rent fixed in 1960 will become the basis of house assessment and at the next general revision say in 1965 that rental would rightly be adopted by the tax authorities in fixing the house tax for the other building also; and is 1959 the maximum for purpose of fair rent fixation will be 'plus 15%'. Thus the applicant of 19 to will continue to pay in 1969 a lesser rent than the applicant of 1969 unless the first is relied on to keep down the fair rent in the second case. With all its imperfections and compromise of conflicting interests law has to be worked applied by Courts with the social picture projected by the statute as the backdrop. 14. In the light of the judicial precedents and the various factors I have touched upon earlier, let me sum up what I regard is the correct approach to fair rent fixation under our Act: (1) Social and not individual justice is the aim of the statute. The two may not overlap always. (2) The law treats the year of letting (and not any later year) as the basic year with reference to which the increases or decreases in rental rates have to be worked out. Annual letting value and prevalent rents for similar accommodation must relate to this year. Current rents may be high because of scarcity of accommodation and so fair rent cannot be reached by taking the average of extant rack rents. (3) Increases over this optimum rental are permissible if they can be attributed to extra amenities like fittings and furniture, gardens, etc.
Current rents may be high because of scarcity of accommodation and so fair rent cannot be reached by taking the average of extant rack rents. (3) Increases over this optimum rental are permissible if they can be attributed to extra amenities like fittings and furniture, gardens, etc. (4) Similarly, all changes and developments (industrial, commercial or other) in the locality and country, unconnected with abnormal shortage of buildings, may be considered as they are factors which may persuade a willing tenant to offer an increased rent not because the landlord has a right to share in this prosperity of the tenant but because any fair tenant would be ready to pay a higher rent than what he was paying in 1940 or at the time of letting, when his income on account of the advantages of the premises substantially rises. Natural causes affecting rents, but not scarcity-induced causes, are relevant. (5) Among the other relevant factors the Court may have due regard to, are the cost of construction and maintenance, the taxes and rates payable by the landlord and so on. (6) Even so, the fair rent should not exceed by more than 15% the monthly rental forming the basis of house tax computation prevailing two years before the date of the application except where and to the extent such items have been excluded from valuation for property tax purposes. (7) Considerations usually resulting from exploitation of serious inadequacy of accommodation are taboo and factors flowing from natural developments unconnected with abnormal housing shortage are permissible data. 15. The sudden jump from Rs. 35/- to Rs. 100/- smacks of unrighteous increase. The municipal rooms being charged Rs. 555/- per month savours of the proneness of landlords to take unreasonable advantage of scarcity of accommodation, reckoning the effect of Ext.D5 also. The reasonable rent expected from similar accommodation, when a landlord threatening eviction is not present, is available from the municipal rental value of the owner-occupied premises door No. 322. The efficacy of municipal estimates of rental value depends on the bona fides and due enquiry attending upon such estimate. The commercial prosperity of the locality can be regarded within the limits I have indicated. 16. The orders under revision have materially erred in the legal approach and, therefore, in the exercise of their jurisdiction.
The efficacy of municipal estimates of rental value depends on the bona fides and due enquiry attending upon such estimate. The commercial prosperity of the locality can be regarded within the limits I have indicated. 16. The orders under revision have materially erred in the legal approach and, therefore, in the exercise of their jurisdiction. I set aside the orders but since the data are largely available on the record I send the case back to the appellate authority who will be at liberty to take additional evidence directly or or through the Rent Control Court. The case will be remitted to the Sub Judge who will take the appeal on file and dispose it of de novo. There will be no order as to costs. Allowed.