A. M. AHMADI, J. ( 1 ) THESE two landlords Revision Applications. under sec. 115 of the Code of Civil Procedure raise important questions concerning the Courts perimeter udder sec. 11 of the Bombay Rents Hotel and Lodging House Rates Control Act 1947 (hereinafter called the Act ). Amongst others the principal question which falls for determination is: where different floors of the same building have been constructed at intervals of a few years and have been let out at such intervals whether. the market value of the land at each letting can be taken into consideration fixing the standard rent in respect of the concerned premises and if yes on what principle should the market-value be. determined? The brief facts which are relevant for deciding the aforesaid question of general importance may be stated as under: ( 2 ) THE petitioners are the owners of a parcel of land admeasuring about 1950 square yards bearing Sub-plot No. 1/a/1 of Final Plot No. 79 of Town Planning Scheme No. 3 (Dariapur-Kazipur) situate in a fully developing and busy locality outside Shahpur Gate behind Harivansh Society. Ahmedabad. In the year 1964-65 they constructed a building consisting of a cellar a ground floor and a mezzanine floor on a part of the said land admeasuring about 321. 30 sq. yards. Half of the ground- floor consisting of six rooms and azzanine floor admeasuring about 1081 sq. feet came to be let in 1965 to Safal English School started by the present opponent No. 2 at Rs. 425. 00 per month plus taxes. The said school occupied the said premises upto 31/03/1968. This Safal English School sold its tenancy rights along with goodwill to Shri Akh- andanand Kelavani Uttejak Mandal a registered public trust which started a school in the said premises from 1/04/1968. The said trust initially paid Rs. 425-per month plus taxes by way of rent to the peti- tioners but it is an admitted fact that the rent was increased to Rs. 501/ per month plus taxes with effect from 1/06/1969. In course of time the school progressed and more and more students joined the school. For want of accommodation the school had to be run in two shifts. The opponents therefore approached the petitioners with a request to cons- truct a first floor so that they may be able to accommodate their students in the additional space. In course of time the school progressed and more and more students joined the school. For want of accommodation the school had to be run in two shifts. The opponents therefore approached the petitioners with a request to cons- truct a first floor so that they may be able to accommodate their students in the additional space. Accordingly in 1969 the petitioners constructed a first floor consisting of six rooms admeasuring about 1980 sq. feet and let it out to the opponents on rent of Rs. 1051. 00 per month plus taxes. Subsequently on 1/06/1970 the cellar portion admeasuring about 475 sq. feet was also let to the opponents at Rs. 211. 00 per month plus taxes. However the pressure for additional space in view of the increase in the total number of students led the opponents to once again requ- est the petitioners to construct a second floor on the said building. The petitioners acceded to this request and constructed a second floor and let it out to the opponents with effect from 1/08/1971 at a rent of Rs. 1051. 00per month plus taxes. Thus the total rent recovered by the petitioners from the opponents came to Rs. 2 814 per month plus taxes. Hardly six months had passed after the letting out of the second floor when the opponents filed an application No. 754 of 1972 for fixation of standard rent in respect of the demised premises. The opponents contended in the said application that the rent recovered by the petitioners vas excessive and that it could not exceed Rs. 800. 00 per month inclusive of taxes. The learned trial Judge after considering the oral as well as the documentary evidence on record came to the conclusion that the fair return which the petitioners could be allowed on their investment cannot exceed Rs. 1 667 per month plus taxes and accordingly fixed the said amount as standard rent in respect of the entire building. Both the petitioners as well as the opponents were aggrieved by this decision of the learned Judge in the Court of Small Causes at Ahmed- abad and therefore they preferred Revision Applications Nos. 23 and 24 of 1977 respectively assailing the said order. The Appellate Bench of the Court of the Small Causes Ahmedabad dismissed the landlords Revision Application No. 23 of 1977 with costs. 23 and 24 of 1977 respectively assailing the said order. The Appellate Bench of the Court of the Small Causes Ahmedabad dismissed the landlords Revision Application No. 23 of 1977 with costs. Is he Revision Applica- tion filed by the opponents was partly allowed and the order of the trial Court fixing the standard rent of the premises at Rs. 1 667 month plus taxes was set aside and instead the standard rent was fixed at Rs. 1 317 month plus taxes. The petitioners feeling aggrieved by this order of the Appellate Bench of the Court of Small Causes in the two Revi- sion Applications have preferred the present two Revision Applications. As both these Revision Applications arise out of the same judgment they are disposed of by this common judgment. ( 3 ) BEFORE proceeding to deal with the submissions made at the Bar a brief survey of the relevant provisions of the Act may be undertaken. Sec 5 (8) defines premises as any land not being used for agricultural purposes or any building or part of a building let separately (other than a farm building) including the garden grounds garages and out-houses if any appurtenants to such building or part of a building any furniture supplied by the landlord for use in such building or part of a building or any fittings affixed to such building or part of a building for the more beneficial enjoyment thereof but shall not include a room or other accommodation in a hotel or lodging house. Sub-sec. (10) of sec. 5 defines standard rent in relation to any premises to mean. (A) where the standard rent is fixed by the Court and the Controller respectively under the Bombay Rent Restriction Act 1939 or the Bombay Rents Hotel Rates and Lodging House Rates (Control) Act 1944 such standard rent; or (B) where the standard rent is not so fixed subject to the provisions of sec. 11 (I) the rent at which the premises were let on the first day of September 1940 or (III) where they were not let on the first day of September 1940 the rent at which they were last let before that day or (IV) where they were first let after the first day of September 1940 the rent at which they were first let or (IV) in any of the cases specified in sec. 11 the rent fixed by the Court; Secs. 9 to 10-E deal with the increase in rent in certain circumstances with which we are not concerned. We next come to sec. 11 which pro- vides that in any of the cases hereinafter mentioned the Rent Court may fix the standard rent at such amount as having regard to the provisions of the Act and the circumstances of the case the Court deems just. (A) where any premises are first let after the specified date and the rent at which they are so let is in the opinion of the Court excessive; or (B) where the Court is satisfied that there is no sufficient evidence to ascertain the rent at which the premises were let in any one of the cases mentioned in sub- clauses (i) to (iii) of clause (b) of sub-sec. (10) of sec. 5; or (C) where by reason of the premises having been let at one time as a whole or in parts and at another time in parts or as a whole or for any other reasons any difficulty arises in giving effect to this Part; or (D) where any premises have been or are let rent-free or at a nominal rent or for some consideration in addition to rent; or (F) where there is any dispute between the landlord and the tenant regarding the amount of standard rent. Clauses (a) (c) and (e) of sub-sec. (1) of sec. 11 are relevant for our purpose. Clause (a) confers jurisdiction on the Rent Court to fix the standard rent at such amount as having regard to the provisions of the Act and the circumstances of the case the Court deems just where the premises are first let after the specified date meaning thereby the first aay of September 1940 and the rent at which they are so let is in the opinion of the Court excessive. Similarly the Rent Court is empowered to determine the standard rent where by reason of the premises having been let at one time as a whole or in parts and at another time in parts or as a whole or for any other reasons any difficulty arises in giving effect to Part 1 or where there is any dispute between the land- lord and the tenant regarding the amount of standard rent. Sub-sec. Sub-sec. (2) of sec 11 also empowers the Court to determine the permitted incre- ases if there is any dispute in that behalf between the landlord and the tenant. ( 4 ) SUB-SEC (1) of sec. 12 lays down that a landlord shall not be entitled to the recovery of possession of any premises so long as the tenant pays or is ready and willing to pay the amount of the standard rent and permitted increases if any and observes and performs the other conditions of the tenancy in so far as they are consistent with the provisions of the Act. Sub-sec. (1) of sec. 13 which begins with a non-obstinate clause provides that a landlord shall be entitled to recover possession of any premises if the Court is satisfied that the case falls within any of the clauses enumerated thereunder. Clause (hh) entitles the landlord to seek eviction on the ground that the premises consist of not more than two floors and are reasonably and bona fide required by the landlord for the immediate purpose of demolishing them and such demolition is to be made for the purpose of erecting new building on the premises sought to be demolished; or where the premises are land such land is reasonably and bona ride required by the landlord for the erection of a new building. Where a Court passes a decree under clause (hh) of sub-sec. (1) of sec. 13 sec. 17-B confers a right on the tenant to intimate the landlord of his intention to occupy a tenement in the new building on its completion. Sec. 18 makes it penal for the landlord to receive any fine premium deposit or any consideration other than the standard rent and permitted increases in respect of the grant renewal or continuance of a lease of any pre- mises. Similarly sec. 19 makes it penal for a tenant to receive any sum or consideration as a condition for the relinquishment transfer or assignment of his tenancy. Sec. 21 enjoins upon the landlord to supply particulars regarding standard rent on demand by the tenant. Secs. 23 to 27 spell out the other obligations of the landlord vis-a-vis the tenant and the demised premises. Sec. 21 enjoins upon the landlord to supply particulars regarding standard rent on demand by the tenant. Secs. 23 to 27 spell out the other obligations of the landlord vis-a-vis the tenant and the demised premises. ( 5 ) IT is obvious from the scheme discernible from the aforesaid provisions that while on the one hand the Act seeks to curb exploita- tion of the tenants in the matter of realisation of rents by landlords on the other hand it promises a fair and reasonable return on invest- ment as and by way of an impetus to the owners of land to construct on their lands and to the owners of old and small superstructures to demolish them and construct new buildings with greater accommodation in their place to overcome the problem of paucity of accommodation. The Act no doubt extends protection to the tenants from eviction but at the same time enjoins upon them to pay the standard rent and permi- tted increases in respect of the premises in their occupation regularly. See. 11 also enjoins upon the Court to fix the rent which it deems just as the standard rent in respect of the premises in question. That is why Shah J. in Bai Dahi v. Ghanshyam A. I. R. 1956 Bombay 105 emphasi- sed that the rent which must be determined as standard rent must appear to the Court to be just having regard to the provisions of the Act and the circumstances of the case. Chagla C. J. in Saipansaheb Dawoodsaheb v. Laxman (1955) 57 Bom. L. R. 413 observed that in fixing the standard rent the correct approach should be what is the nct return which a landlord should be reasonably allowed on his investment. It is in the background of this objective of the Legislature that the Court must proceed to fix the standard rent in respect of a demised premises whenever there is a dispute RD that behalf between the landlord and he tenant. ( 6 ) WHAT then are the principles which should guide the Court in fixing the standard rent in respect of premises given on rent. Having regard to the language of sec. 11 of the Act the Court must fix what it considers to be just as the standard rent bearing in mind the provisions of the Act and the circumstances of the case. Having regard to the language of sec. 11 of the Act the Court must fix what it considers to be just as the standard rent bearing in mind the provisions of the Act and the circumstances of the case. We have already read the relevant provisions of the Act and indicated the scheme and purpose thereof. The circumstances of the case may now be kept in mind. The premises are situate in a well-developed and busy locality. They are being used for the purpose of running a Primary as well as a Secondary School. The school is being run in two shifts which is bound to increase the wear and tear and reduce the life of the building. The cost of maintaining the building in good condition would be fairly high. In addition the cost of providing other services such as water supply etc. would also be more than normal. The entire building is designed and constructed with a view to housing a school. In fact the first and the second floors were constructed at the behest of the opponents as the) found it difficult to accommodate the increasing number of students in the available space. Therefore the superstructure was specially designed to the purpose of housing a school. Another factor which must be borne in mind is the possibility of the premises remaining vacant for some time in the event of the present opponents vacating the same. As the upper floors have been specially designed for a school only those who are desirous of running a school in the said premises will be interested in taking the premises on rent. These are some of the circumstances which must weigh with the Court in fixing the standard rent of the premises in question. ( 7 ) UNDER sec. 11 of the Act where the premises are let after first day of September 1940 as in the instant case the Court can interfere and fix the standard rent at such amount as it deems just and reasonable if the rent charged is in the opinion of the Court excessive. The term excessive according to Random House Dictionary (College Editions means exceeding the usual or proper limit or degree extravagant extreme inordinate exorbitant or unreasonable. Tendolkar J. in Harilal v. Jain Co-op. Housing Society (1957) 59 Bom. L. R. 217 while pointing out that under sec. The term excessive according to Random House Dictionary (College Editions means exceeding the usual or proper limit or degree extravagant extreme inordinate exorbitant or unreasonable. Tendolkar J. in Harilal v. Jain Co-op. Housing Society (1957) 59 Bom. L. R. 217 while pointing out that under sec. 11 (1) (a) of the Act the intervention of the Court in cases of letting after 1/09/1940 with contractual rent can only be where the rent is not only not reasonable but exceeds by some sub- stantial margin what is reasonable so that it may be termed excessive rightly observed that there is always a gap between what is reasonable and what is excessive and what is excessive does not begin where what is reasonable necessarily ends. According to the learned Judge if the contractual rent is within this gap between what is excessive and what is reasonable the Court has no jurisdiction to fix a just rent in such a case. This view was later approved by a Division Bench of the Bombay High Court in Rukmanibai v. Shivnarayan (1965) 67 Bom. L. R. 692. I am in respectful agreement with the above view expressed by Tendolkar J. It is therefore clear on the plain language of sec. 11 of the Act that the Court has jurisdiction to interfere with the contractual rent if and only if it considers the same to be excessive i e. unreasonably high. ( 8 ) THE next question to be considered is as regards the valuation of the land. Two questions require to be settled before we proceed to determine the land value; (i) whether land value has to be determined with reference to the date of letting or with reference to the date of purchase and (ii ). how should the land value be apportioned if at all having regard to the fact that the different floors of the same building were constructed at intervals of a few years. The question whether for the purpose of determining the fair and reasonable rent the value of the land; is the value actually paid by the landlord at the date of purchase regardless of the date of the construction or letting of the building or whether it is the value of such land at the date of completion of the building or its actual letting first arose for decision in Harilals case (supra ). However in that case the learned Judge did not consider it necessary to determine this question as in his opinion the decision was not likely to make any difference on the question of fixation of standard rent. However the very same question came up for consid- eration before the Division Bench of the Bombay High Court in Rukmani bais case (supra ). K. K. Desai J. speaking for the Division Bench observed that under the Act where premises are first let after 1/09/1940 the standard rent should be ascertained as regards the land; involved by determining fair return on the basis of the market value of the land at the time of the first letting. At the same time he observed that it would be upon to the Court to consider the circumstance of the landlord having become owner of the land for a much smaller price ax anterior date than the date of first letting. This view is consistent with the scheme of the Act which on the one hand seeks to prevent exploita- tion of needy tenants while on the other it encourages owners to build on their lands by promising to them a fair return on their investment. There is nothing in the Act to conclude that the Legislature did not intend to allow the landlord to receive the benefit from the rise in the land value in respect of properties let for the first time after 1/09/1940 Such a view would run counter to the legislative policy to encourage new constructions on open lands to overcome the problem of paucity of accommodation which is particularly acute in urban areas. In the afore- said case the Division Bench has given convincing reasons on page 700 in support of its view with which I am in respect full agreement. ( 9 ) THAT takes me to the question of apportionment of the land value. In the instant case the superstructure admittedly stands on land admeas- uring 321. 30 sq. Yards. As pointed out earlier the owners initially built only the ground floor and later added the first and the second floors at the behest of the tenants. There is no dispute that according to the building bye-laws only one-third of the land could be built upon and two-thirds of the plot had to be kept open. In other words the minimum plot area required for. There is no dispute that according to the building bye-laws only one-third of the land could be built upon and two-thirds of the plot had to be kept open. In other words the minimum plot area required for. raising a superstructure of the area of 321. 30 square yards would be approximately 964 sq. Yards. In the instant case as there is a compound wall the valuation expert has calculated the land price on the basis that the total land required is 975 square yards. No exception can be taken and indeed none was taken so far as this approach is concerned. Even otherwise it is well settled that where the building regulations permit only a portion of the land to be utilised for construction and the rest to be left open the minimum land required for raising a superstructure of that size must be taken into account for the purpose of determining the market value of the land consumed by the said superstructure. Accordingly in the instant case for the purpose of Station of standard rent the Court must proceed on the premise that the total land utilised by the owners for raising the superstructure in question is 975 square yards. In fact it is on this premise that Mr. Shah tried to urge that the respondents are the tenants of 975 square yards of land a contention rightly negatived by both the Courts below in view of the recitals in the rent-notes. ( 10 ) THAT brings me to the crucial point which was hotly debated before me by the learned counsel for the rival sides. The point has been broadly formulated in the opening paragraph of this judgment and may now be explained in some detail. The ground-floor (with cellar) was constructed and let in 1964-65 the first floor in 1969 and the second floor in 1971. Indisputably the land prices in the city of Ahmedabad had risen between 1965 and 1969 and thereafter between 1969 and 1971. Even the respondents expert says that the land prices were on the increase after 1958 Both the Courts below have for good reason held that the valuation report submitted by the landlords expert is dependable. According to the said report the value of the land in the said locality can be assessed at Rs. 40. 00 per square yard in 1965: Rs. 70. According to the said report the value of the land in the said locality can be assessed at Rs. 40. 00 per square yard in 1965: Rs. 70. 00 per square yard in 1969 and Rs. 100. 00 per square yard in 1971. I have already concluded that the date of letting is the material date for the purpose of determining the market value of the land for working out the fair rent or standard rent of the demised premises. I have also recorded my agreement with the view that the benefit of the increase in the market value of the land on which the demised structure stands would enure to the landlord. For this reason the submission of Mr. Shah that once the full impact of the market value of the land is borne by the tenants in the fixation of rent of the ground floor portion the landlords cannot be allowed any return on land value in fixing the standard rent of the subsequently built upper floors cannot be accepted. If such a view is taken it will be unjust for three reasons namely (i) it will prove to be a disincentive to owners of existing structure to add floors to their existing buildings; (ii) there will be a wide disparty in the rent of two buildings built at or around the same time as the rent of the buildings built for the first time will be on the basis of the market value of land at the date of letting which will carry the benefit of the rise in land prices while the rent of a floor added to an existing building will be denied the advantage of rise in land value; and (iii) we would be ignoring the fact that the terrace area also has a market value and would fetch a price if the right to construct on the terrace area is given to a third party in which case the said third party would be entitled to claim a return on the price paid by him for the terrace area. But then the question is whether the whole rise in the value of the land during the said interval should fall on the added floor or floors or whether the said rise should be apportioned prorata on the basis of the carpet area of each floor. But then the question is whether the whole rise in the value of the land during the said interval should fall on the added floor or floors or whether the said rise should be apportioned prorata on the basis of the carpet area of each floor. Now if all the floors of a building are constructed at one time the land value is spread over all the floors and so also the increase in the land value should be proportionately spread over floorwise where floors are built at intervals. The vertical development of the property from time to time will not enhance the standard rent of the existing structure for the simple reason that the benefit of the rise in the value of the land available to the newly constructed floors will not be available to the existing structure even though the rise is allocated proportionately between all the floors including the existing floor. In order that the disparity in the standard rent of the newly added floors and the existing floor may be within reasonable limits it is proper to allocate the rise floorwise rather than allow the entire rise to fall on the newly added floor or floors and thereby hike up the standard rent. Having regard to the fine balance struck by the Act on the one hand it seeks to protect needy tenants against exploitation by unreasonable landlords; on the other hand it invites the owners to build on their lands and existing structures by promising to them a fair return on their investment and having regard to the fact that land value is generally distributed amongst all the floors if built at the same time and with a view to avoiding wide ranging disparity in the rents I think it would be reasonable to allocate the rise in the land value proportionately between all the floors in the case of a building to which floors are added subsequently at an interval of a few years. ( 11 ) HAVING set out the principle which should govern Courts in fixing the standard rent in respect of floors constructed at intervals of a few years on an existing building the question that remains is regar- ding the application of the said principle to the facts of the present case. Both the Courts below misdirected themselves in the exercise of their jurisdiction under sec. 11 read with sec. Both the Courts below misdirected themselves in the exercise of their jurisdiction under sec. 11 read with sec. 28 of the Act in refusing to allow anything towards the land value so far as the upper floors are con- cerned and in proceeding to determine the standard rent of the entire premises in the occupation of the tenants as if the entire building con- sisting of the ground floor first floor and second floor was built at one point of time. I have already come to the conclusion that the benefit of the rise in land value between the date of letting of the ground floor and the date of letting of the first floor as well as between the date of letting of the first floor and the date of letting of the second floor must be allocated floorwise on pro-rata basis. On the question of land value and the cost of construction the trial Court preferred to place reliance on the report of the landlords expert. In revision the Bench of the Court of Small Causes also placed reliance on the said report and determined the price of the land at the date of construction of the ground floor and the cost of construction of all the three floors on that basis. Yet surprisingly on the question of rise in land prices the Bench did not rely on the said report even though the tenants expert had also opined that the prices of land were on the increase from 1958 and onwards. Whether the prices had increased or not during the relevant period is a question of fact which could not be gone into by the Bench under sec. 29 (3) of the Act. That section only empowers the Court to call for the case to satisfy itself that the order made was according to law. The Bench therefore clearly exceeded its jurisdiction by interfering with a finding of fact. Even otherwise there is no valid reason to doubt the rise in land value as reflected in the said report. The error of both the Courts not to apportion the rise in land value therefore cannot be allowed to stand. ( 12 ) THE trial Court held that the landlords were entitled to a return of six per cent on the cost of construction and 8-2/3 per cent on land value. The error of both the Courts not to apportion the rise in land value therefore cannot be allowed to stand. ( 12 ) THE trial Court held that the landlords were entitled to a return of six per cent on the cost of construction and 8-2/3 per cent on land value. Ill revision the Bench of the Court of Small Causes allowed a return of six per cent on the land value and a net return of 6 per cent on the cost of construction The trial Court had allowed a sum of Rs. 2 809 by way of annual outgoings under various heads but in revision the Bench of Small Causes while accepting in principle that the landlords would be entitled to outgoings did not make any allowance whatsoever under that head. This appears to be an error apparent on the face of the record and must therefore be corrected. A certain percentage must be allowed by way of outgoings for vacancies bad debts obsolescence depreciation and sinking fund etc. which the Court must determine in the facts and circumstances of each case depending on the nature of construction the use to which the property is put the wear and tear etc. In the instant case the payment of rent would be regular as a sizeable part of the rent is reimbursed from the grant received by the school under the Grant-in-Aid Code. The structure is of R C C. make the school is running two-shifts with the result that the maintenance cost would be fairly high It is the statutory duty of the landlords under sec 23 of the Act to keep the demised premises in good repair. The possibility of bad debts and irregular payment of rent is minimised because of the grant received by the school under the Grant-In-Aid Code. Normally the depreciation or sinking fund is allowed on 90 per cent of the cost of construction. Ordinarily in the case of a R. C. C. building with an expected life of 60 years the outgoings are allowed at the rate of 1/2 per cent for repairs 1 per cent for insurance and 61 per cent for depreciation on 90 per cent of the cost of construction i. e a total of 1. 1 per cent on the total construction cost. 1 per cent on the total construction cost. In the present case the economic life of the building must he calculated from the date of construction of the ground floor. It must also be borne in mind that as the demised premises will be used by a large number of students around 750 I believe and that too in two shifts the maintenance cost is bound to be more than the normal Added to that is the fact that prices of building materials are ever on the increase while the pur- chasing power of the rupee is fast falling. In the backdrop of these circumstances I think it would be reasonable to allow outgoings at the rate of 1 25 per cent on the total cost of construction ( 13 ) THE return on the cost of construction has been allowed by the Bench of the Court of Small Causes at 62 per cent on the following line of reasoning:"now when the construction is made after the year 1958 when the bank rate had risen and the return on the gilt edged security also had risen and when the municipal taxes have also increased considerably the gross return would be no doubt 8. 2/3 per cent even taking into consideration the repairs insurance sinking fund or depreciation on the cost of construction etc if the tenant has agreed to meet any of the ordinary outgoings himself or to pay the municipal taxes the corresponding deduction must be made from the rent payable by the tenant. In the instant case we are satisfied that the tenant is liable to pay taxes. If the gross return is allowed at 8. 2/3% then from the total return we shall have to deduct the amount of taxes payable by the tenant. Taking into consideration the fact that municipal taxes on higher rent is more than 30 to 35% the net return should be allowed at 68% on the cost of construction". Mr. Pandya rightly submitted that the percentage of return on the value of the land and the cost of construction was linked with the rate of interest on gilt-edged securities (Government Securities) and the prevailing bank rate. He supported this submission by inviting my attention to Note 14 (iv) A on page 420 Andhyarujinas Law of Rent Control which reads as under:"ordinarily the Bombay Small Causes Court allows 51/2 per cent. He supported this submission by inviting my attention to Note 14 (iv) A on page 420 Andhyarujinas Law of Rent Control which reads as under:"ordinarily the Bombay Small Causes Court allows 51/2 per cent. net return on the cost of construction but where the construction is of 1952-53 when the bank rate had risen from 3 per cent. to 31/2 per cent. and return on the gilt-edged security also had risen a higher rate of return of 6 per cent. On cost of construc- tion is allowed. For the same reason after 1958 net return on cost of construc- tion is 61/2 per cent". He next pointed out that after December 1958 the Bank rate steadily increased was 42 per cent in the beginning of 1963 5 per cent in September 1964 and 6 per cent in February 1965. Of course it came down to 5 per cent in March 1968 but arose to 6 per cent by January 1971. Similarly the return on the gilt-edged securities varied from 49 per cent in 1962- 63 to 51 per cent in 1965-66 and 54 per cent in 1971-72. Mr. Pandya therefore rightly submitted that the learned Judges constituting the Bench of the Court of Small Causes failed to take into account this upward fluctuation in the Bank rate as well as return on gilt-edged securities while pegging down the net return at 62 per cent on the cost of construc- tion. Mr. Pandya therefore submitted that if 22 per cent to 3 per cent above the gilt-edged securities or Bank rate is allowed on the cost of construction the net return would fluctuate between at least 71 per cent to 8 per cent per annum. The Court should also take note of the fact that between the date of commencement of construction and the date of letting the amount invested by the owners did not fetch any return whatsoever. In determining the return on investments made in real estate the Court must realise the fact that the standard rent once determined will not increase with the subsequent increase in the Bank rate returns on gilt- edged securities and returns fetched by other investors from time to time although the benefit of inflation by way of rise in the prices of real estate will be available if and when the tenant vacates. Keeping in mind all these facts and the fact that the return on the investment of the owners of building must be less than what a hypothetical tenant would have to pay by way of interest on the capital borrowed for building the same superstructure for himself I think it would be reasonable to allow a net return of 7 per cent on the cost of construction of the ground floor and 7. 25 per cent on the cost of construction of the upper floors since the municipal taxes are paid by the tenants. ( 14 ) THERE are some arithmetical errors committed by the Bench of the Court of Small Causes in its judgment which may be corrected at this stage. In paragraph 23 of its judgment while determining the cost of construction of the ground floor the court directed a deduction of 10 per cent from the cost of construction worked out by the expert and arrived at a figure of Rs. 50 600 which is an obvious error because the correct figure would be Rs. 60490-6049 + 54 441 So also while working out the cost of construction the learned Judges relied on the statement of the landlords expert that the cost of construction of the first floor would be less by 8 per cent than the cost of construction of the ground floor. According to the expert the cost of construction of the first ground at the date of construction of the first floor would be Rs. 260. 00 per sq. yard. If 8 per cent is deducted the cost of construction comes to Rs. 239. 2 per sq. yard and accordingly the total cost comes to Rs. 76 855 hot Rs. 72 300 The learned Judges committed the error of taking the rate of construction of the ground floor at the date of its actual construction and deducted 8 per cent therefrom instead of taking the rate of the con- struction of the ground floor at the date of construction of the first floor. There is no dispute so far as the cost of construction of the second floor is concerned. ( 15 ) MR. There is no dispute so far as the cost of construction of the second floor is concerned. ( 15 ) MR. Shah however submitted that if this Court is inclined to examine the correctness of the decision of the Bench of the Court of Small Causes notwithstanding his objection to the maintainability of this application he would like to point out a patent error committed by the Bench in fixing the land value so far as the ground floor is concerned. According to him the tenants are in occupation of only a part of the ground floor (ground floor 160. 65 sq. yards cellar 80 30 sq. yards and mezzanine floor 25. 10. sq. yard while the rest is in possession of others. According to the landlords expert the market value of the land at the date of letting of the ground floor can be taken at Rs. 40- per square yard. Since the plot area is taken at 975 sq. yards the total market value of the land works out to Rs. 39 0 The Bench of the Court of Small Causes has apportioned this value for all the three floors. Thus the value for the ground floor would be Rs. 13 0 Since half the ground floor is in possession of the tenant it has deducted Ks. 6500/- and had thus taken the value at Rs. 32 500 Now if the rise in land value is apportioned floorwise this method cannot be ado- pled. Mr. Shah is right in his submission. Since the total land value at the date of letting of the ground floor is Rs. 39 0 and since one half the ground floor is let to the respondents the land value so far as the ground floor is concerned can only be taken at Rs. 19 500 ( 16 ) THERE is one more submission which may be answered at this stage. Mr. shah submitted that the ground floor was let to Safal English School for Rs. 425. 00 plus taxes in 1965 and the said premises were later transferred to the respondents who paid the rent at the said rate till it was raised to Rs. 50 per month plus taxes. He therefore submitted that in no case can the standard rent of the ground floor exceed Rs. 425 per month. There is a two-fold objection to this submission. 50 per month plus taxes. He therefore submitted that in no case can the standard rent of the ground floor exceed Rs. 425 per month. There is a two-fold objection to this submission. Even though each floor was let separately the tenants preferred a single appli- cation for the fixation of the standard rent as if the different floors let at different times constituted a single demised unit. Objection was raised by the landlords to the maintainability of the application before the learned trial Judge but the same was spurned as is clear from paragraph 19 of the judgment. The learned trial Judge fixed the standard rent treating all the floors in the possession of the tenant as a single unit. The Bench of Small Causes which heard the cross-revision applications also fixed the standard rent on the basis that all the floors in the occupation of the respondents constituted a single unit. It is therefore too late in the day now to have the unit broken up. The second objection is that the rent was increased from Rs. 425. 00 per month to Rs. 501. 00 per month as the premises were transferred by Safal English School with goodwill as a running concern. It is the case of the landlords that they were entitled under sec. 100 (1) of the Act to increase the rent not exceeding 25 per cent of the standard rent and accordingly the rent was mutually increased to Rs. 501. 00 per month plus taxes. If all the floors in the possession of the respondents had not been treated as a single unit this contention of the landlords which prima facie appears to have substance would have been examined by the Courts below. Therefore on both the grounds the submission fails. ( 17 ) THE conclusions may now be tabulated and the standard rent determined on that basis:note: The land value of the two floors is worked out as under:first floor area 975 sq. yds. x Rs. 30 rise inprice divided between two floors = Rs. 14625. 00second floor area 975 sq. yds x Rs. 60 rise inprice divided between three floors = Rs. 19500. 00thus the annual fair and reasonable return works out to Rs. 21 896 i. e. approximately Rs. 1825. 00 per month excluding taxes which the tenant has undertaken to pay under the rent notes. 14625. 00second floor area 975 sq. yds x Rs. 60 rise inprice divided between three floors = Rs. 19500. 00thus the annual fair and reasonable return works out to Rs. 21 896 i. e. approximately Rs. 1825. 00 per month excluding taxes which the tenant has undertaken to pay under the rent notes. The agreed rent for the three floors in the occupation of the respondents is Rs. 2814. 00 which is clearly excessive. Therefore this is a fit case in which the standard rent of the entire premises in the possession of the respondents should be fixed at 1825/- excluding taxes to be paid by the respondents. ( 18 ) I will now answer the preliminary objection as to the main- tainability of the present Civil Revision Applications raised by Mr. Shah. the learned advocate for the respondents. According to Mr. Shah these being Revision Applications under sec. 115 of the Code of Civil Procedure the High Court can interfere with the order of the Court below only if it appears that the subordinate Court has exercised jurisdiction not vested in it by law or has failed to exercise jurisdiction so vested in it or has acted in exercise of its jurisdiction illegally or with material irregularity. In other words according to Mr. Shah the section applies to jurisdiction alone that is in cases of illegal assumption of jurisdiction or the non-exercise of jurisdiction or the irregular exercise of jurisdiction but it cannot be invoked to correct decisions on questions of fact and law. In support of this submission he invited my attention to three decisions of the Supreme Court: (1) Vora Abbasbhai v. Haji Gulamnabi (1964) 5 G. L. R. 55; (2) Ratilal v. Ranchhodbhai A. I. R. 1966 S. C. 439; and (3) Bai Hiragauri v. Abdul Kadar (1973) 14 G. L. R. 617. In the first case Supreme Court held that the High Court had in exercise of its powers under sec. In the first case Supreme Court held that the High Court had in exercise of its powers under sec. 115 of the Code of Civil Procedure no authority to set aside the order merely because it was of the opinion that the judgment of the District Court was assailable on the ground of error of fact or even of law and in Support thereof quoted with approval a passage from the decision of the Privy Council in Balakrishna Udayar v. Vasudeva Aiyar LR 44 IA 261 In the second case the Supreme Court reiterated that the scope of sec. 115 of the Code of Civil Procedure was restricted to matters pertaining to jurisdiction and the High Court is not empowered in exercise of its revisional power to interfere with aa order of a subordinate Court on the ground that its decision proceeded on an erroneous construction of some statutory provision. In the last case the Supreme Court once again emphasised that a subordinate Court which has jurisdiction to try a matter is entitled to construe a provision of law in the exercise of that jurisdiction and even if the construction placed by the subordinate Court is found to be erroneous in law the High Court has no power to interfere with that conclusion on the ground that the subordinate Court exercised jurisdiction illegally or with material irreg- ularity. It is clear from these three decisions to which my attention was drawn by Mr. Shah that the High Court can in exercise of revisional powers under sec. 115 of the Code interfere only if the order of the subordinate Court is assailed on a question of jurisdiction namely the illegal assumption of jurisdiction not vested in it or the illegal refusal to exercise jurisdiction vested in it by law or the exercise of the jurisdiction illegally of with material irregularity. The High Court has no jurisdiction under sec. 115 of the Code to correct errors of fact and law however gross they may be. In the present case however on the crucial question as to the apportionment of rise in land value where additional floors have been superimposed on an existing building at intervals both the Courts below misdirected themselves in the exercise of their jurisdiction by totally omitting to apply the correct principle and allow a reasonable return on the increase in the value of the land during the interregnum. Similarly as has been pointed out above the Bench of the Court of small Causes in the exercise of its revisional jurisdiction under the Act wholly ignored the fact that the landlord is entitled to an allowance by way of outgoings for vacancies bad debts obsolescence depreciation and sinking fund. So also indetermining the return on the cost of constru- ction it totally ignored the material fact that after December 1958 the rate of interest on gilt-edged securities and the bank rate had steadily increased. Therefore this is a case in which in the exercise of its juri- sdiction the lower Court acted with material irregularity in ignoring or overlooking the evidence on record as to the rise in land value to which the landlords were entitled under law so far as the construction of the upper-floors is concerned and in totally refusing to allow anything by way of outgoings after accepting the principle that the landlords would be entitled to a certain percentage on the cost of construction by way of outgoings. So far as the refusal to allow outgoings is concerned it appears to be an error apparent on the face of the record. So also the lower Court totally overlooked the fact that the bank rate and returns on gilt-edged securities had increased after December 1958 and the landlords were therefore entitled to a proportionate increase in the return on the cost of construction. Besides there are certain arithmetical errors committed by the lower Court which are apparent on the face of the record and require correction. For these reasons I am of the opinion that this is a case which falls under Clause (c) of sec. 115 of the Code of Civil Procedure. I am therefore of the opinion that the preliminary objection raised by Mr. Shah must fail. 1 ( 19 ) IN the result the Revision Applications are partly allowed. The order passed by the learned Judges of the Bench of Small Causes fixing the standard rent at Rs. 1317. 00 per month exclusive of taxes is set aside and instead the standard rent in respect of the entire premises in the occupation of the respondents is fixed at Rs. 1825. 00 per month excluding taxes which are found payable by the respondents by both the Courts below. 1317. 00 per month exclusive of taxes is set aside and instead the standard rent in respect of the entire premises in the occupation of the respondents is fixed at Rs. 1825. 00 per month excluding taxes which are found payable by the respondents by both the Courts below. The order directing the landlords to pay the cost in Revision Application No. 23 of 1977 is also set aside. The rule in both the appli- cations is made absolute accordingly. Looking to the extent of failure and success parties are directed to bear their own costs throughout. Application allowed. .