Judgment :- 1. This revision petition has been referred to us by our learned brother Balagangadharan Nair J. The reference order sets out the facts and the question that arises for decision and, therefore, we will extract the same in full. "This revision by the tenant arises out of a proceedings brought by the respondent-landlord under the Buildings (Lease and Rent Control) Act for fixation of fair rent. 2. Petitioner is holding a room and an adjacent veranda under the rent deed Ext. Al, at a monthly rent of Rs. 26/-. He has admittedly sub-let them to two parties on Rs. 45/- and Rs. 30/- a month, aggregating to a rent of Rs. 75/-. While so, the Corporation of Calicut, within whose area the premises are situate, revised the property tax assessment with effect from 1965 (Ext. A2 being the relevant extract) and assessed the premises to tax, on the basis of annual rental value of Rs. 427/- and Rs. 300/-, totalling Rs. 727/- which works to a monthly rent of Rs. 60.58. The respondent brought the petition in 1968 asking for fixation of fair rent at Rs. 60.58 and an addition of the maximum permissible increase of 50% a month. To this the petitioner took various defences and contended that there was no ground to revise the contractual rent of Rs. 26/-. 3. The Rent Control Court dismissed the petition holding that fair rent' cannot be fixed on the basis of Ext. A2 or on the basis of the sub-rent which the petitioner was collecting from his tenants. 4. On appeal by the respondent, the learned Sub Judge (the appellate authority) took a different view, holding that Ext. A2 can be taken as a basis for fixing fair rent. He accordingly fixed the fair rent at Rs. 60.60, rounding off Rs. 60.58. 5. From this judgment, two revisions were taken to the District Court Revision 85 of 1970 by the respondent claiming an enhancement of 15% of the rent fixed by the Sub Judge and Revision 104 of 1970 by the petitioner claiming that the contractual rent should not have been enhanced at all. The learned District Judge held that the appellate authority was justified in fixing fair rent on the basis of Ext. A2 but found that there was no case for allowing the 15% increase. The learned District Judge held that the appellate authority was justified in fixing fair rent on the basis of Ext. A2 but found that there was no case for allowing the 15% increase. The learned judge however noticed that under S.102 of the Calicut City Municipal Act, the annual value of the building is the gross annual rent less a deduction of 10% thereof for repairs etc. It was held that this deduction should be excluded for fixing fair rent and that so computed the annual rent came to Rs. 808.88 which worked out to Rs. 67.40 a month. The learned District Judge fixed this as the fair rent and on that finding allowed the respondent's revision in part and dismissed the petitioner's revision. 6. Mr. Velayudhan Nair for the petitioner raised a short point in support of the revision. Now sub-s. (1) of S.5 empowers the Rent Control Court to fix fair rent after holding such enquiry as it thinks fit. Sub-s. (2) provides that in fixing fair rent the court shall take into consideration the property tax or house tax (really the monthly rent on the basis of which such tax is fixed) at the time of letting, in the property tax or house tax register of the local authority within whose area the building is situated. The proviso which follows, enacts in substance and so far as material, that the fair rent may in proper cases be lower than, but shall in no case exceed by more than 15% the monthly rent on the basis of which the property tax or house tax for the building prevailing two years immediately before the date of the application, was fixed. Mr. Velayudhan Nair pointed out that while sub-s. (1) permits such enquiry as the court thinks fits, sub-s. (2) obliges the court to take into consideration the monthly rent on the basis of which the house tax was fixed at the time of letting in. Sub-section (2), it was contended, indicates the primary or basic factor that the court should take into consideration, in fixing the fair rent. Sub-section (2), it was contended, indicates the primary or basic factor that the court should take into consideration, in fixing the fair rent. According to counsel, the proviso which refers to the monthly rent on which house tax, prevailing two years immediately before the date of the application was fixed, comes into play only where the court in proper cases thinks of fixing a fair rent lower than or in excess of that monthly rant, subject to a a ceiling of 15%. In other words except where the court thinks, in proper cases, of operating in this permitted range of reduction or increase, the proviso has no application and the court has to go by sub-section (2). As to the present case it was argued that as both the appellate and revisional courts have refused to enhance the fair rent up to 15% or to any extent Ext. A2 is irrelevant and they have acted without jurisdiction in not leaving the proviso out of account and in not applying the substantive provisions of sub-section (2). In short, the argument was, the appellate and revisional courts should have left out Ext. A2 and based themselves on the monthly rent at the time of letting. Both sides together cited Muhammad Keyi v. Premalatha,1962 KLT 366 (F.B ), Auto Transport Union (P.) Ltd. v. Cardamom Marketing Co. Ltd., 1966 KLT 1063, Swami Dharmananda v. M. V. Mathai 1972 KLJ. 205, Narayanan v. Unnikrishnan,1973 KLT 182 and the unreported judgment in CRP. Nos. 310 and 319 of 1974, which are all cases on S.5 of the Act, but none of them has discussed the point now raised on behalf of the petitioner. I think the question sufficiently important and frequent to be considered by a Bench. I, therefore, refer the revision to a Division Bench." 2. It is necessary to read S.5 (1) to 5 (3). "5. Determination of fair rent. (1) 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. I, therefore, refer the revision to a Division Bench." 2. It is necessary to read S.5 (1) to 5 (3). "5. Determination of fair rent. (1) 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 the 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 or in which machinery have been installed and such fittings or machinery 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 fifteen per cent, the monthly rent on the basis of which the property tax or house tax for the building, prevailing two years immediately before the date of the application, was fixed, or if the building was not assessed to property tax or house tax before the said period of two years, the monthly rent on the basis of which the property tax or house tax prevailing immediately before the date of the application was 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." The proviso occurring after sub-section (2) was substituted by Act 7 of 1966 subsequent to the Full Bench decision of this Court in Kunhammad Keyi & others v. Premalatha & others (1962 KLT 366). The said proviso as it stood before the substitution read: "Provided that 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." In the Full Bench case the question arose, whether it was right to assume, that the monthly rent on the basis of which tax was fixed at the time of letting, that was material, as if the words "at the time of letting" appearing in sub-section (2) were to be read into the proviso so that it would read: "Provided that 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 at the time of letting." Reman Nayar J. (as he then was) speaking on behalf of the Full Bench said that it was wrong to assume so. The Full Bench further said: "The object of S.5 of 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 abnormal conditions introduced a measure of compulsion enabling landlords to force unfair bargains on tenants. (Conversely, the statutory continuance of tenancies enforced on landlords may give a tenant unfair advantage by allowing him to remain in occupation 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). 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. 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 increase 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 prevailing during the 12 months prior to 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 hardship would be 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." 3. In our view the proviso as substituted gives effect to what has been stated by the Full Bench in the passage quoted above. Sub-section (2) enables the court to take into consideration the property tax or house tax fixed for the building at the time of letting, (with respect, as rightly pointed out in the reference order, really the monthly rent on the basis of which such tax is fixed) in the property tax register or house tax register of the local authority. So also the earlier portion of the proviso enables the court to take into consideration the monthly rent on the basis of which the property tax or house tax for the building prevailing two years immediately before the date of the application was fixed. So also the earlier portion of the proviso enables the court to take into consideration the monthly rent on the basis of which the property tax or house tax for the building prevailing two years immediately before the date of the application was fixed. However, in no case can the fair rent exceed by more than 15% of the monthly rent on the basis of which the property tax or the house tax for the building, prevailing two years immediately before the date of the application, was fixed. But this does not mean that the criterion for fixation of fair rent is only monthly rent on the basis of which property tax or house tax for the building prevailing two years immediately before the date of the application was fixed. If that be so the provision in the proviso that the fair rent may be lower than such monthly rent but shall in no case exceed by more than 15% would have no meaning. The sum and substance of the provision of S.5 therefore is, the rent control court shall take into consideration all relevant facts including the rent on the basis of which the property tax or the house tax for the building prevailing at the time of letting was fixed (tax, as entered in the property tax register or house tax register of the local authority), as also the rent on the basis of which such property tax or house tax for the building prevailing two years immediately before the date of the application, was fixed. The provision only requires that it (fair rent) shall not exceed in any case by more than 15% of the monthly rent on the basis of which property tax or house tax prevailing two years immediately before the date of the application was fixed. Having pointed out the maximum or the upper limit, S.5 of the Act directs the Rent Control Court to consider not only the two factors made mention of therein but also all relevant considerations and materials that are placed before it as stated by the Full Bench in Kunhammad Keyi's case. This is clear from sub-s. (1) of S.5 which says that that court shall fix the fair rent. 4. The learned counsel for the respondent brought to our notice the decision in Auto Transport Union v. Cardamon Marketing Co. This is clear from sub-s. (1) of S.5 which says that that court shall fix the fair rent. 4. The learned counsel for the respondent brought to our notice the decision in Auto Transport Union v. Cardamon Marketing Co. (1966 KLT 1063) and particularly to the following passage in Para.18 thereof: "Therefore what the authorities should have done, in view of the authoritative pronouncement of a Division Bench of this Court, is to look into the assessment register and find out what the municipal assessment for these properties is and increase it by 15 per cent. Instead of adopting the simple method and which is the only method they are bound to adopt, the learned counsel pointed out, that the principle laid down by the learned judges stand completely ignored." As we understand the aforesaid passage, the learned judge was only summarising the arguments advanced by counsel. That this is so is clear from Para.24 of the judgment wherein the learned judge said: "The proviso makes it clear that the Rent Court can fix the fair-rent in appropriate cases even lower than the property tax or house tax fixed; but it places the outer limit by stating that the fair-rent 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." The proviso to sub-section (2) as substituted only makes this fact clear. We have no doubt that the rent control court is to fix the fair rent taking into consideration all relevant facts that are brought to its notice. The only limit that is prescribed by sub-section (2) is the outer limit which as per that provision can in no event exceed by more than 15% of the monthly rent on the basis of which the building tax or the property tax prevailing two years prior to the date of application was fixed. 5. The only limit that is prescribed by sub-section (2) is the outer limit which as per that provision can in no event exceed by more than 15% of the monthly rent on the basis of which the building tax or the property tax prevailing two years prior to the date of application was fixed. 5. In Kunhammad Keyt's case, the Full Bench, holding that the proviso as it stood then was not to be read with the phrase 'at the time of letting' added at the end of that proviso, or in other words, holding that the upper limit of fair rent is not related to the monthly rent on the basis of which the property tax or house tax for the building had been fixed at the time of letting, considered the question as to what, then, such maximum rent is relatable, and held: "The proviso relates to the fixing of the fair rent, and it is obvious that the point of time with reference to which it uses the words, 'has been fixed' is the point of time when the fair rent is determined, which, under the ordinary rule governing legal proceedings would date back to the date when the court was moved for relief." The latter half of the present proviso accepts this - that is, in cases where the building had not been assessed to property tax or house tax at any time before the period of two years of the date of application while, the earlier portion of the proviso specifies the monthly rent with reference to. which the upper limit of fair rent is to be calculated, as 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 fixed. We think, with this difference, the present proviso has given effect to the Full. Bench decision aforesaid. 6. which the upper limit of fair rent is to be calculated, as 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 fixed. We think, with this difference, the present proviso has given effect to the Full. Bench decision aforesaid. 6. In the light of the discussion above made, we are not inclined to accept the extreme positions canvassed for, by counsel on either side, viz., that the monthly rent on the basis of which the local body has assessed the tax, prevailing two years immediately before the date of the application, and that alone, is the basis for determination of fair rent (this is the contention of the learned counsel for the respondent) and, that the court can look into the proviso and apply the same only after it makes up its mind to fix the fair rent at a rate lower than or in excess of the monthly rent on the basis of which the house tax was fixed at the time of letting as mentioned in the body of sub-section (2), (this is the argument advanced by the learned counsel for the Civil Revision Petitioner). 7. This takes us to the decisions of the Rent Control Court, the Appellate Authority and of the Revisional Authority. The Rent Control Court has taken into consideration all the materials placed before it on either side. That court has discussed the evidence of pw.1 and R. W.1 elaborately, and has accepted Rw.l's evidence to the effect that he is collecting Rs. 45/-and Rs. 30/-from the subtenants because he has let out the rooms as furnished rooms. That court has also taken into account the location of the building, the rent of the adjoining buildings as evidenced by Ext. BI (a building of which petitioner is one of the co-owners) and the evidence of pw.1 in cross-examination read with Ext. B2. The Rent Control Court has also noticed the fact that the tax assessed as per Ext. A2 by the local body is on the basis of the rent collected by the tenant from his subtenants. BI (a building of which petitioner is one of the co-owners) and the evidence of pw.1 in cross-examination read with Ext. B2. The Rent Control Court has also noticed the fact that the tax assessed as per Ext. A2 by the local body is on the basis of the rent collected by the tenant from his subtenants. (here, we may mention that the learned, counsel for the Civil Revision Petitioner has raised another interesting argument viz., that the contract of tenancy is in respect of the whole building, whereas the tax assessed is not in respect of the building as a whole, but in respect of the two rooms separately and that therefore, on the facts obtained in this case, the proviso to sub-section (2) of S.5 would not be attracted to this case; since in our view, this case has to go back to the appellate authority for fresh disposal, we refrain from pronouncing upon it, but we make it clear, that the tenant the civil revision petitioner will be free to urge that point as well, if he is so advised). In the Rent Control Court an argument was advanced on the side of the respondent herein that since the tenant (the civil revision petitioner) was collecting a higher rent by subletting the building, the petitioner was entitled to get the fair rent fixed on the basis of the rental income derived by. the tenant. That court observed that though subletting is a ground for eviction the income derived by subletting cannot be taken into account for determination of fair rent. We do not feel called upon to decide that question also at present in so far as this case has to go back to the appellate authority as stated above. The Rent Control Court also took note of Exts. Al to A3 produced on behalf of the petitioner before that court. As regards Ext. A3, that court said that that document could not be admitted in evidence for various reasons. In short the rent control court has discussed the evidence adduced on both sides elaborately and exhaustively. 8. The Rent Control Court also took note of Exts. Al to A3 produced on behalf of the petitioner before that court. As regards Ext. A3, that court said that that document could not be admitted in evidence for various reasons. In short the rent control court has discussed the evidence adduced on both sides elaborately and exhaustively. 8. We are afraid that both the appellate authority and the revisional authority fell into the error of assuming that the sole basis for determination of fair rent is the monthly rent on the basis of which the property tax or the house tax for the building prevailing for two years immediately before the date of the application, was fixed. The appellate authority has not adverted to any of the evidence discussed by the Rent Control Court except Ext. A2. The revisional authority also has not adverted to the evidence of Rw.1 nor has it given reasons for rejecting the evidence of Rw.l which has been accepted by the Rent Control Court. No doubt, the revisional authority has referred to Exts. BI and B2, but only to brush them aside as not helpful to decide the quantum of fair rent for the building in question for the reason that there is no evidence as regards the dimensions of the rooms covered by those documents, as also regarding the respective rent of the said rooms prior to the general revision of property tax by the Corporation. Both Pw.1 and Rw.1 have spoken about the rooms covered by Exts. BI and B2, and their evidence on those aspects has not been considered. We are not satisfied that the revisional authority has applied its mind to the question that was agitated before that authority. We see aside the common order in C.R.P. Nos. 85 and 104 of 1970 on the file on the District Court, Kozhikode, as also the judgment in C.M.A. No. 163 of 1969 on the file of the Subordinate Judge's Court Kozhikode. We remand the case to the appellate authority for fresh disposal in the light of what is stated in this judgment and in accordance with law. The parties will suffer their costs in this revision petition.