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1991 DIGILAW 527 (KER)

E. K. Mohan v. Parameswaran Namboodiripad

1991-12-09

G.H.GUTTAL

body1991
ORDER G.H. Guttal, J. 1. Both these petitions are by the tenant against whom a decree for eviction under S.11(2)(b) and (c) of the Kerala Buildings (Lease and Rent Control) Act was made and finally confirmed by this Court in C. R. P. No. 1669 of 1985 on 30-7-1991. In this order the petitioner is referred to as the "tenant" and the respondents as the "landlord". In C. M. P. No. 2631 of 1991 the tenant prays that he be granted six months time from 30-8-1991 to deposit the arrears of rent nearing a sum of Rs. 3 lakhs. C. M. P. No. 2631/1991 was argued in extenso by counsel for both sides on 30-9-1991. The submission of Mr. Warrier was that, after this Court dismissed the revision petition by the tenant without granting any time for payment of the arrears of rent, there is no jurisdiction in this Court to grant time beyond what is statutorily permitted. I reserved the judgment. But before I could pronounce the order the petitioner took out C. M. P. No. 3121 of 1991 after hurriedly depositing in the trial court, without the permission of any court, a sum of Rs. 2,54,000/- towards the arrears of rent. In this C M. P. he prays that the delay of 35 days in depositing the arrears of rent in accordance with the order of the Appellate Court in R. C. A. No. 122 of 1980 as confirmed by, this Court in C. R. P. No. 1669 of 1985 be condoned. This judgment will dispose off both the petitions. 2. A brief history of this litigation may be outlined. The landlords filed O. S. No. 29 of 1974 and O. S. No. 227 of 1974 for arrears of rent, interest on the arrears and sum of Rs. 11963.80 towards the reimbursement of the corporation tax paid by the landlords but payable by the tenants. Under two lease deeds. (a) the rent was fixed at Rs. 1,500/- per month Rs. 800/- for eastern building and Rs. 700/- for the western building; (b) interest at 6% per annum was payable by the tenant on the arrears; and (c) taxes were payable by the tenant. The defence of the tenant was (a) there was no agreement of rent; (b) the building was renovated and reconstructed. It was agreed that the landlords will spend Rs. 700/- for the western building; (b) interest at 6% per annum was payable by the tenant on the arrears; and (c) taxes were payable by the tenant. The defence of the tenant was (a) there was no agreement of rent; (b) the building was renovated and reconstructed. It was agreed that the landlords will spend Rs. 50,000/- The balance of the expenses on account of renovation and construction was to be paid by way of loan by the tenants to the landlords. According to the tenants in consideration of this, the rent was agreed to be Rs. 1,000- p.m. and not Rs. 1,500/-. (c) The landlords spent Rs. 54, 067/- and the tenants advanced Rs. 1,05,319.61. A statement of account was made. It was agreed that the tenants had spent Rs. 1,16,076.78 and the landlords spent Rs. 54,067/-. Both are alleged to have signed the accounts. The Rent Control Court accepted the tenant's case and dismissed the suits. Two appeals being A. S. Nos. 234 and 235 of 1980 were filed. The landlords also filed R. C. P. No. 33 of 1974 in the Rent Control Court, Ernakulam, for eviction on account of arrears of rent. The Rent Control Court dismissed the petition. Against this R. C. A. No. 122 of 1988 was filed by the landlords. The appeal was allowed and decree for eviction made. Finally C. R. P. No. 1669 of 1985 by the tenant and the two appeals being Appeal Nos. 234 and 235 of 1980 by the landlords were heard by Shamsuddin, J. The appeals were allowed and the tenant's C. R. P. No. 1669 of 1985 was dismissed by a common judgment dated 30th July, 19.91. The order of the Appellate Court in Rent Control Appeal No 122 of 1988 confirmed by Shamsuddin, J. in C. R. P. No. 1669 of 1985 reads thus: "In the result the Rent Control Appeal is allowed with costs. The order impugned is set aside. R. C. P. 33/74 shall stand allowed A under S.11(2)(b) of Act 2/65. If the arrears of rent, that is to say, Rs. 73,005.65 and Rs. 64,061.40 together with costs throughout as well as the subsequent rent at the rate of Rs. The order impugned is set aside. R. C. P. 33/74 shall stand allowed A under S.11(2)(b) of Act 2/65. If the arrears of rent, that is to say, Rs. 73,005.65 and Rs. 64,061.40 together with costs throughout as well as the subsequent rent at the rate of Rs. 1, 500/- per month that accrued due from 31-7-1973 upto this date, after deducting the payments already made during the pendency of the Rent Control Petition and this appeal, with 6% interest thereon is paid, within one month from today, the order of eviction shall stand vacated." No rent was paid pursuant to this order. But C. R. P. No. 1669 was filed which, as already stated, was dismissed. While dismissing the B C. R. P. No. 1669 of 1985, Shamsuddin, J. did not grant any time for payment of the arrears of rent and other sums. 3. In C. R. P. No. 1669 of 1985, my learned brother Shamsuddin, J. on 30-7-1991 made an elaborate and well considered order after examining the testimony of witnesses and the documents. His findings are relevant to these petitions. The judgment which is common to C. R. P. 1669 of 1985 and A. S. Nos. 234 and 235 of 1980 records the following findings: (i) the tenant's version that the agreed rent was Rs. 1,000/- and not Rs. 1,500/- per month was untrue. (ii) The tenant broke open the room occupied by the landlord and stole the documents including the agreement which fixed rent at Rs. 1,5007- p. m. (Para.25 of the judgment). (iii) Ext. B 23, a document relied upon by the tenant to prove that the rent was Rs. 1,000/- and not Rs. 1,500/- is not genuine. (Para.26 of the judgment). (iv) Ext. B 4, was a handbook produced by the tenant pertaining to expenses of construction and renovation of the building. In this book, the tenant interpolated a writing to show that Rs. 1,0007- was the rent. Such entry in the book unconnected with accounts of construction and renovation, was not natural. Ext. B 4 was fabricated by the tenant. (v) Although the tenant actually paid rent of Rs. 1,500/- p. m. by cheques, he falsely contended that monthly rent was Rs. 1, 000/- Therefore he urged a case which was false to his knowledge (Para.30 of the judgment) (iv) The tenant produced an account book Ext. Ext. B 4 was fabricated by the tenant. (v) Although the tenant actually paid rent of Rs. 1,500/- p. m. by cheques, he falsely contended that monthly rent was Rs. 1, 000/- Therefore he urged a case which was false to his knowledge (Para.30 of the judgment) (iv) The tenant produced an account book Ext. B2 to support his case that the rent was Rs. 1,0007- p. m. On scrutiny it was held that the entries in Ext. B2 were made subsequently. (Paragraphs 31 and 35 of the judgment). (vii) The tenant claimed that expenses incurred by him on construction and renovation, were Rs. 1,71,007.09. The total receipt by the landlord was Rs.1,76,501.16. After giving credit Rs.5494.07 due to the landlord. The accounts were settled and signed by the tenant. Yet, he contended that Rs. 1,71,007.09 were due from the landlord. (Para.37). Notwithstanding that the balance was struck in the account books signed by the petitioners a false case was made out at the trial that a larger amount was due to the tenants towards cost of construction. (viii) The monthly rent as agreed by the tenant is Rs. 1,500/-. The total arrears of rent due from the tenant as on 31-7-1973 came to Rs. 1,37,067.05. Interest at the rate of 6% per month was payable on the sum. 4. The result of the findings is that the tenant is bound to pay all the arrears in accordance with the decrees within one month from 30-7-1991 when the C. R. P. was dismissed. Thus the petitioner was obliged, under the decrees, to pay the entire amount including the rent after 31-7-1973 at the rate of Rs. 1,500/- per month and interest at the rate of 6% per annum before 30-8-1991 when the statutory period of one month expired. 5. Counsel argued elaborately as to whether this Court, exercising revisional jurisdiction, has, the power to extend time beyond the statutory one month provided under S.11(2)(c) of the Act. But Mr. Warrier on 21-11-1991, during the arguments in C. M. P. No. 3121 of 1991, graciously conceded that this power may be assumed to exist in the revisional court. Therefore I need not now deal with the question whether there exists such a power. But Mr. Warrier on 21-11-1991, during the arguments in C. M. P. No. 3121 of 1991, graciously conceded that this power may be assumed to exist in the revisional court. Therefore I need not now deal with the question whether there exists such a power. However, I should not be understood to have held that this Court possesses the power to extend time for payment of rent and other sums due from tenant, beyond the time stipulated by the statute. 6. Three questions arise: (i) Whether the payment made by the tenant and set out in the statement annexed to C. M. P. No. 3121 of 1991 is a complete discharge of the obligation to pay arrears of rent, costs and the interest. (ii) If the answer to the question at (i), is in the affirmative, is the delay and default in payment of rent and other sums due, was cured on 30-10-1991 when the petitioner deposited the amount in the court of the Principal Munsiff, Ernakulam? (iii) Whether, having regard to the conduct of the tenant, this Court ought to extend the time for payment of the arrears of rent or to condone the delay in depositing such arrears? 7. The total sum due as on 31st October, 1991 would be in the region of Rs. 3,36,293/-. The following facts should be considered for judging whether the "payments" set out in the statement annexed to C. M. P. No. 3121 of 1991 constitute a discharge of the liability to pay the rent as per the decree. (a) Although under the contract the tenant is bound to pay interest at 6% per annum on the amount of arrears, which means on every sum of Rs. 1,500/- of monthly rent remaining unpaid, the tenant in his elaborate statement annexed to C. M. P. 3121 of 1991, claims to have paid only B Rs. 15,544/- towards interest. According to him the decree does not use the words "per annum", after the figure "6%" but merely describes the interest as "6%''. According to him, therefore, he is bound to pay only 6% of the amount of the arrears of rent. In his view, the interest as per the decree is equal to 6% of the amount of the unpaid rent and not 6% per year (b) The tenant in his statement has claimed that he has paid Rs. According to him, therefore, he is bound to pay only 6% of the amount of the arrears of rent. In his view, the interest as per the decree is equal to 6% of the amount of the unpaid rent and not 6% per year (b) The tenant in his statement has claimed that he has paid Rs. 2,16,0001- towards the arrears of rent for the period 31-7-1973 to 30-7-1991. This amount has been calculated by him at the rate of Rs. 1,000/- per month. The decree admittedly directs payment of rent at Rs. 1,500/- per month. This payment is not in accordance with the decree. (c) As on 31st October, 1991, the interest calculated at 6% per annum itself comes to Rs. 97,9 80/. This represents the undisputable default. (d) During the trial the tenant was bound to pay in the court, the admitted amount of rent. In order to escape this liability created by the statute, the tenant raised the dispute about the monthly rent, the adjustment of the expenses of construction and so on. (e) The tenant has deducted Rs. 14,000/- from the amount due under the decree. This amount is supposed to represent expenses of whitewashing the buildings. This is not permissible under the decree or contract between the parties. (f) Only a sum of Rs.1,21,842/- has been paid by the tenant upto 26-9-1991. The principal amount alone comes to Rs.2,20,500/- 8. In my opinion the tenant continues to commit default in payment E of rent due under the decree. There are at least three reasons which lead to this conclusion, which are set out in the next paragraph. 9. The facts set out at (a) to (f) in Para.7 are extracted from the tenant's statement to test the tenant's version that he has paid substantial part of the rent as per the decree. Each one of these facts announces that, the tenant continues to default. The statement annexed to the tenant's C. M. P. No. 3121 of 1991 does not even claim to have paid the entire amount in accordance with the decree. The deduction of Rs. 14,0007- from the legitimate dues of the landlord is unauthorised. Secondly, instead of paying interest at 6% per annum, the tenant, has tried to trick the landlord and the court, by his interpretation of "6%". The decree says that the amount shall be payable with interest at 6%. The deduction of Rs. 14,0007- from the legitimate dues of the landlord is unauthorised. Secondly, instead of paying interest at 6% per annum, the tenant, has tried to trick the landlord and the court, by his interpretation of "6%". The decree says that the amount shall be payable with interest at 6%. The figure 6% is described as interest. Therefore even if the words "per annum" are omitted, - no doubt inadvertently and without anticipating the trick schemed by the tenant - the word "interest" conveys what the tenant refuses to see. Interest means money paid for use of loan. It is payable per month, per year or at other periods - as long as the loan remains unpaid. In the context of the evidence in this case, 6% always meant 6% per annum. The tenant has deliberately tried to hoodwink the court by adopting such a defence. Thirdly, the tenant has made no secret of the fact that he does not wish to pay rent at Rs. 1,500/- p. m. as per the decree. That is why in item No. 3 he has calculated the sum of Rs. 2,16,000/-, at Rs. 1,000/- p. m. when the decree directs payment at Rs. 1.500/- p. m. Payment at Rs. 1,000/- p. m. is clear admission of default in payment of rent as per the decree. It is unnecessary to reproduce other circumstances from the tenant's statement to prove continued default. The default, in payment of rent is not only writ large on the tenant's own statement, but is almost admitted. Since even after the "deposit" of the amount in the trial court, the tenant owes large sums, thereby perpetuating the default, the question of curing the default by such deposit does not arise. 10. Mrs. Seemanthini, learned counsel for the petitioner urged with remarkable perseverance that her client was driven into the arrears due to unfortunate circumstances. In the context of her arguments, I will now deal with in the following paragraphs the question No (iii) raised in Para.6 above. 11. Clause (c) of sub-s.(2) of S.11 of the "Kerala Buildings (Lease and Rent Control) Act lays down that the order of eviction made by the Rent Control Court shall not be executed for one month from the date of the order The period of one month from the date of the order of eviction is granted by the statute. 11. Clause (c) of sub-s.(2) of S.11 of the "Kerala Buildings (Lease and Rent Control) Act lays down that the order of eviction made by the Rent Control Court shall not be executed for one month from the date of the order The period of one month from the date of the order of eviction is granted by the statute. However, the Rent Controller has been granted the power to grant further time beyond the statutory one month. The order of the Rent Controller "shall not be executed before the expiry of one month from the date of such order or such further period as the Rent Control Court may in its discretion allow ............... " (emphasis supplied). It has been assumed, on the basis of the statement made by counsel for the landlord, that, this Court, in exercise of its revisional authority possesses the power to grant "such further period as the Rent Control Court may in its discretion allow." The statute has advisedly used the words "in its discretion" implying that there is no legal right to an extended time. The legal right is confined to making an application to the court to use its discretion and allow further time. There are two aspects of this power of the court to grant further time beyond the statutory period of one month. (a) Firstly this power is discretionary which demands that the court should adopt a principled approach in granting or refusing to grant further time. (b) Secondly, the power to grant further time presupposes that this relief is equitable and calls for balancing of equities between the parties. 12. The tenant has no legal right to the extended time. The statute does not enjoin the court to grant such time but leaves the matter to its discretion. Undoubtedly this Court, as a court of equity and law, possesses the power to enlarge time in the cases of hardship. But the law has given to the tenant one month's time to pay all arrears of rent. Since the court is called upon to grant time beyond the statutory period of one month, it is necessary to follow certain principles in exercising this authority. But the law has given to the tenant one month's time to pay all arrears of rent. Since the court is called upon to grant time beyond the statutory period of one month, it is necessary to follow certain principles in exercising this authority. The reason is that by extending time to enable a defaulter to continue to occupy the premises by making belated payments, injustice may be caused to the landlord who has suffered the tenant's defaults and has waited for the expiry of the statutory period to receive rent due to him. Therefore a judicial approach, while not being rigid and rigorous, must be such as would ensure smooth" running of the society. In its broad sense, equity is practically equivalent to natural justice and morality. Snell's Principles of Equity, Twenty Eighth Edition, Page 5. Nobody will argue that moral principles should be introduced in granting equitable reliefs. But the principle that natural justice is equity is unexceptionable. It follows therefore that a person who seeks equitable relief must have justice on his side. Equity not only reforms and moderates the rigour, hardness and edge of the law but it also defends the law from crafty evasions, and new subtleties invented and contrived, to evade the law. The court, in exercising equitable rules, must therefore, caution itself not only against the harshness and rigour of the law but more importantly, against crafty evasion of law; for the function of equity is to aid and assist the law and not to destroy it. In a given state of circumstances, extension of time to enable the tenant to pay arrears of rent may be necessary to soften the rigour of law. It is equally important that crafty evaders are not permitted to contrive, in the name of equity and justice, new methods of evasion and defeat the very purpose of law, thereby destroying it Snell's Principles of Equity, Twenty Eighth Edition Page 6,. Two well known maxims of equity come into play. He who seeks equity must do equity and he who comes into equity must come with clean hands. These doctrines of equity are two faces of the same coin and go hand in hand. The petitioner, in order to justify extension of time beyond the statutory period must therefore, do equity and his conduct in relation to the subject matter of the litigation must not be blame worthy. These doctrines of equity are two faces of the same coin and go hand in hand. The petitioner, in order to justify extension of time beyond the statutory period must therefore, do equity and his conduct in relation to the subject matter of the litigation must not be blame worthy. When one seeks discretionary reliefs the blame for the situation giving rise to the application for extended time must not fall on him. If it does, the conclusion is that the litigant has not done equity and has not come with clean hands. 13. The following facts will show that the tenant has no desire to pay the arrears of rent. The tenant had the first opportunity of paying the rent at Rs. 1,500/ per month when the dispute arose. Assuming that Rs. l, 000./- per month was the agreed rent nothing prevented the tenant from paying or depositing the admitted amount of rent. Thus the tenant has displayed refusal to pa; rent at the admitted rate, at the very first opportunity which the statute gave to him. Then the Appellate Court made the determination of rent and it arrears. This was the second opportunity of complying with the court' order directing the tenant to pay all the arrears of rent with interest and costs. The payment of the amount of rent was no longer left to calculated or disputed, for, the Appellate Court has determined the specific sum payable by the tenant. This too was not done. This was the second admitted and deliberate default. It illustrates how just the tenant's conduct has been. The Civil Revision Petition was dismissed on 30-7-1991. The judgment of Shamsuddin, J. set at rest all controversies and put an end to any scope for controversy in regard to the amount of rent and interest. The period of one month referred to in S.11(2)(c) was to expire on 29t August, 1991. The tenant was determined not to pay in accordance with the final determination made by this Court. He disregarded not only the legitimate claim of the landlord but also the order of this Court which commander him to pay the arrears of rent. On 28th August, 1991, C. M. P. No. 262 of 1991 was filed. It was not accompanied by payment of the arrears rent. Thus even at the third opportunity the tenant did not pay the arrears of rent. On 28th August, 1991, C. M. P. No. 262 of 1991 was filed. It was not accompanied by payment of the arrears rent. Thus even at the third opportunity the tenant did not pay the arrears of rent. Instead of making payment with C. M. P. No. 2631 of 1991 the tenant prayed for six months' time by making the application just one day before the expiry of the statutory period. This is yet another deliberate refusal to pay the arrears of rent. Then C. M. P. No. 3121 of 1991 was filed by the tenant after depositing in the trial court some amount which according to him represents the total arrears of rent with "interest''. 14. The findings of Shamsuddin, J. set out by me in paragraphs above aggravate the wrong done by the tenant. The far from honest dispute about the quantum of rent, theft of adverse documents, using counterfeit documents like Ext. B 23 fabrication of entries in the handbook Ext. B 4 are some of the aggravating factors so far the tenant's conduct is concerned. 15. The facts relating to the tenant's conduct after the court's orders were made, and those showing his conduct during the trial, present a picture of unjust, iniquitous and unclean conduct. Not only does justice not He on his side, but is clearly on the side of the landlord who has been compelled to wait since 1975 to receive even the admitted amount. 16. In the application of this beneficent legislation it may be urged g that the court should lean in favour of the tenant. This would undoubtedly be so where equities are equal and the tenant's conduct is just and fair. One aspect of the matter is, as already stated, the tenant's conduct in relation to the subject matter which disentitles him to any discretionary or equitable relief. Another aspect of the matter is the circumstances in which the tenant is placed. There are tenants who are owners of industry, owners of cinema theatre or as in this case, owner of hotel consisting of 60 rooms. On the other hand, there are tenants of a different class - poor tenants living in hutments, chawls or two room tenements, office goers, hawkers on the street and so on. There are tenants who are owners of industry, owners of cinema theatre or as in this case, owner of hotel consisting of 60 rooms. On the other hand, there are tenants of a different class - poor tenants living in hutments, chawls or two room tenements, office goers, hawkers on the street and so on. In dealing with a diversity of human beings distinguished by their socio economic circumstances a uniform, even handed yardstick is not only inappropriate but may result in injustice. In a system like ours where both tenants and landlords live and earn their livelihood on the premises a balanced approach demands a close look at the circumstances of the tenant and the landlord. In this case, the tenant runs a hotel consisting of 60 rooms, for which the monthly rent is a meagre Rs. 1500/-. No circumstance suggesting that he did not earn income during the period of default, is discernible. Considering the second aspect also there is no case for extension of time to deposit the arrears or to condone delay in depositing the arrears. These facts together with the conduct of the tenant set out in Para.9 to 15 above, do not call for a lenient approach. 17. For all these reasons, both the petitions are dismissed with costs.