GANGA RAM v. RAM GOPAL — 1991 DIGILAW 64 (HP)

JUDGEMENT V. K. Mehrotra, Actg. C. J. :- The present revision under Section 24(5) of the Himachal Pradesh Urban Rent Control Act, 1987 (for short the Act) is by the landlords, owners of a shop in the tenancy of the two respondents, Ram Gopal and Dila Ram. 2. The landlords initiated proceedings under Section 14 of the Act before the Rent Controller, District Sirmaur at Paonta Sahib seeking ejectment of the tenants on the ground that the tenants were in arrears of rent from July 1, 1986 till the date of the filing of the petition, namely, Nov. 14, 1986. The landlords claim that the rent for the shop was payable at Rs. 450/- per month. The defence of the tenants was that the rate of rent was only Rs. 125/- per month and that they were not in arrears of any amount, in as much as, rent had been paid up to March, 1987 at that rate. 3. While the matter was pending before the Rent Controller at the stage of arguments, after recording of evidence, an effect was made for reconciliation between the parties. This was done on June 8, 1986. 4. One of the two tenants, namely, Ram Gopal, made a statement on oath saying, inter alia, that the matter had been settled between the parties and according to that settlement, the respondents would pay rent for the shop at the rate of Rs. 250/- per month with effect from June 1, 1989. Further, that the amount of Rs. 3250/-, which was the amount of rent for the period between April 1, 1987 and May 31, 1989 at the rate of Rs. 125/- per month, will be paid to the landlords by the tenants within 30 days of that date failing which it would be open to the applicants-landlords to recover the possession of the shop from the tenants through execution proceedings. The statement further made was that the petition of the landlords be disposed of according to the statement. At the end of the statement, not only the person who had made it, namely, Ram Gopal, but also the learned counsel appearing for the tenants in the proceedings affixed their signatures. 5. On behalf the landlord, one of them, namely, Gange Ram, also made a statement of on oath. He said that he had heard and fully understood the statement made by Ram Gopal. 5. On behalf the landlord, one of them, namely, Gange Ram, also made a statement of on oath. He said that he had heard and fully understood the statement made by Ram Gopal. It was acceptable to him. The applicants were agreeable that the petition should be decided in accordance with the statement of Ram Gopal. Further, that the applicants did not want to pursue their ejectment petition against the tenants. Also, that the damaged portion of the floor, walls and ceiling of the shop would be got repaired within 30 days. 6. On the basis of the aforesaid statements, the Rent Controller (Senior Sub-Judge, Nahan, Camp at Paonta-Sahib) re-corded an order. In it, he observed, inter alia, that : "in view of the statements of the parties, which shall form part of the order, the petition is allowed............" Later the learned Rent Controller also observed that : "the parties are directed to abide by their statements recorded today and the same shall form part of the order...." 7. It appears that the tenants changed their mind and assailed the order, aforesaid, by filing Appeal No. 13-N/14 of 1989. This appeal was decided on October 17, 1989 by the Appellate Authority, namely, the Additional District Judge, Sirmaur at Nahan. The learned Judge, after noticing the necessary facts, formulated the following two points for his decision : "1. Whether the findings of the learned Rent Controller are sustainable in the eye of law ? 2. Relief." 8. On the first point, the learned Judge felt that the compromise said to have been made in the case before the Rent Controller was not in accordance with the provisions of O. 23 R. 3 of the Code of Civil Procedure, as interpreted by the Supreme Court in Gurpreet Singh v. Chatur Bhuj Gopal, AIR 1988 SC 400. As such, the same could not be given effect to. In the concluding paragraph (para 13) of its judgment, the Appellate Authority said that : "in view of my findings on point No. 1....... the appeal is accepted and the impugned order passed by the learned trial Court dated 8-6-1989 is set aside. As such, the same could not be given effect to. In the concluding paragraph (para 13) of its judgment, the Appellate Authority said that : "in view of my findings on point No. 1....... the appeal is accepted and the impugned order passed by the learned trial Court dated 8-6-1989 is set aside. The case is already fixed for arguments and the learned Rent Controller shall proceed with the trial of the case ignoring the statement of the parties recorded on 8-6-1989 and it is hoped that since the petition is old one, the same shall be disposed of within one month of the receipt of the same........" Aggrieved, the landlords have approached this Court. 9. The case came up for admission before this Court when notice, pending admission, was directed to issue to the respondents -tenants. After they appeared, the matter was heard on June 15, 1990. The learned Chief Justice (Honble P.C. Balakrishna Menon), who heard the matter, felt that some observations of the learned Single Judge in Kali Dass Vasudeva v. Swaran Singh, 1980 (2) RCR 281 : (AIR 1980 HP (NOC) 165) lent support to a submission made before him that the Rent Controller had no jurisdiction to accept a compromise providing for eviction of a tenant on failure of payment of rent that had accrued due subsequent to the institution of the proceedings, with which the learned Chief Justice found it difficult to agree and that the matter deserved to be heard by a Division Bench. It is on that account that the case came up before us for hearing. 10. We have heard Shri Kuldip Singh, for the landlords-applicants, and Shri K. D. Sood, for the tenants-respondents. 11. Before proceeding to deal with the matter any further, we may notice that we have carefully gone through the judgment of V. P. Gupta, J., in Kali Dass Vasudeva but we are unable to discover therein any observation of the nature referred to by the learned Chief Justice in his order dated June 15, 1990. Be that as it may, as the matter has been heard by us at some length, we propose to deal with the aspect noticed by the learned Chief Justice in his order so that the legal position may cease to be obscure. 12. Be that as it may, as the matter has been heard by us at some length, we propose to deal with the aspect noticed by the learned Chief Justice in his order so that the legal position may cease to be obscure. 12. Section 14(2) of the Act, in its material part, says that : "14(2) A landlord who seeks to evict his tenant shall apply to the Controller for a direction in that behalf. If the Controller, after giving the tenant a reasonable opportunity of showing cause against the applicant, is satisfied- - (i) that the tenant has not paid or rendered the rent due from him in respect : of the building ..... within fifteen days after the expiry of the time fixed in the agreement of tenancy with his landlord or in the absence of any such agreement by the last day of the month next following that for which the rent is payable ................... the Controller may make an order directing the tenant to put the landlord in possession of the building or rented land and if the Controller is not so satisfied he shall make an order rejecting the application........." 13. A plain reading of the provision shows that it is an occurrence of a situation contemplated by S. 14(2)(i) alone that an order of ejectment can be made by the Rent Controller. The existence, therefore, of the aforesaid situation is jurisdictional in nature. 14. The real question, however, is whether it is open to the parties, in proceedings before the Rent Controller or at any stage thereafter, to agree to the enhancement of rent for a period subsequent to the date of the institution of the proceedings and further to provide that in the event of a default in compliance by the tenant of the term of enhancement, the tenant rendered himself liable for ejectment from the demised premises. The question also involves determination of the aspect whether a compromise or settlement in these proceedings has to be strictly in conformity with O. 23, R. 3 of the Code of Civil Procedure. 15. The Act provides in Section 25 that : "25. The question also involves determination of the aspect whether a compromise or settlement in these proceedings has to be strictly in conformity with O. 23, R. 3 of the Code of Civil Procedure. 15. The Act provides in Section 25 that : "25. For the purposes of this Act, an Appellate Authority or a Controller appoint-ed under this Act shall have the same powers of summoning and enforcing the attendance of witnesses and compelling the production of evidence as are vested in a court under the Code of Civil Procedure, 1908." 16. A reading of this provision makes it clear beyond doubt that the provisions of the Code of Civil Procedure have been made applicable, in terms, for limited purposes. In other respects, however, the principles of the Code of Civil Procedure would be attracted subject to a provision to the contrary in the Act itself. 17. Order 23 does not, in terms, apply to proceedings before the Rent Controller. Its principles would, however, be attracted, as far as practicable, since there is nothing inconsistent therewith contained in the Act. The authorities, like the Rent Controller and the Appellate Authority, would be free to evolve their own methodology consistent with the principles of fair play and not inconsistent with anything contained in the Act or the Rules framed there under. We find ourselves in agreement with the observations contained in Chaman Lal Narang v. Ashwani Kumar, AIR 1974 Punjab and Haryana 260 and Brij Lal v. Yash Pal, 1985 (1) RCR 551 on this aspect. 18. The Act deals with the question of rent in some of its provisions. For example, S. 20(1) of the Act says : "20(1).- Every tenant shall pay rent within the time fixed by contract or in the absence of such contract, by the fifteenth day of the month next following the month for which it is payable." 19. Section 4 deals with determination of fair rent. It provides : "4(1) The Controller shall, on application by the tenant or the landlord of a building or rented land, and after holding such enquiry as he may think fit, fix the fair rent for such a building or rented land. Section 4 deals with determination of fair rent. It provides : "4(1) The Controller shall, on application by the tenant or the landlord of a building or rented land, and after holding such enquiry as he may think fit, fix the fair rent for such a building or rented land. (2) The fair rent under Sub-Section (1) shall be, - (a) in respect of the building, the construction whereof was completed on or before the 25th day of January, 1971 or in respect of land let out before the said date, the rent prevailing in the locality for similar building or rented land let out to a new tenant during the year 1971, and (b) in respect of the building, the construction whereof is completed after the 25th day of January, 1971 or in respect of land let out after the said date, the rent agreed upon between the landlord and the tenant preceding the date of the application, or where no rent has been agreed upon, the rent shall be determined on the basis of the rent prevailing in the locality for similar building or rented land on the date of application. (3) Notwithstanding that the fair rent for building or rented land has been fixed under the East Punjab Urban Rent Restriction Act, 1949 or under the Himachal Pradesh Urban Rent Control Act, 1971, a landlord or tenant of such a building or rented land shall be entitled to get its fair rent fixed under this Section. (4) Notwithstanding anything contained in this Act, the Controller may fix the fair rent on the basis of the compromise arrived at between the parties to the proceedings and such rent shall be binding only on the parties and their heirs. (5) The fair rent fixed under this Section shall be operative from the date on which the application is filed under this Section." 20. Section 4(4) clearly contemplates that fair rent may be fixed by the Rent Controller on the basis of the compromise arrived a between the parties to the proceedings before him. This Section, thus, recognises the right of the parties to agree to the amount of rent which will be payable by the tenant for the premises let out to him. Section 4(4) clearly contemplates that fair rent may be fixed by the Rent Controller on the basis of the compromise arrived a between the parties to the proceedings before him. This Section, thus, recognises the right of the parties to agree to the amount of rent which will be payable by the tenant for the premises let out to him. There is no prohibition; at least none was brought to our notice, in the Act which precludes the parties from agreeing to a higher rate of rent for a period subsequent to the institution of a petition for eviction of the tenant under S. 14(2) of the Act. Thus viewed, it seems clear that irrespective of the amount of rent on the basis whereof the tenant is said to have fallen in arrears to enable the landlord to seek his eviction, it is open to the landlord and the tenant to agree to a higher (or lower) rate of rent for the demised premises and that agreement may relate even to a period subsequent to the date of the institution of the proceedings under S. 14(2) of the Act. 21. The rent initially claimed by the landlords in the petition was Rs. 450/- per month. The tenants said that it was only Rs. 125/- per month. In the statement made on oath before the Rent Controller, one of the tenants, making the statement on behalf of the respondents in the eviction petition, agreed that the amount of rent payable would be Rs. 125/- per month for the period between April l, 1987 and May 31, 1989. Also, that the rate of rent would be Rs. 250/- -per month with effect from June 1, 1989. One of the landlords also made a statement on oath in which he agreed to what was stated by the tenant. On the basis of these statements, the Rent Controller found, in his order dated June 8, 1989, that the rent would be payable at the rate of Rs. 250/- per month with effect from 1-6-1989. This agreement is, in our opinion, binding upon both the parties because there is no specific methodology provided in the Act or in the Rules framed there under for agreeing to an amount of rent even in Section 4. The agreement in this respect can be held enforceable at the instance of the landlord. 22. This agreement is, in our opinion, binding upon both the parties because there is no specific methodology provided in the Act or in the Rules framed there under for agreeing to an amount of rent even in Section 4. The agreement in this respect can be held enforceable at the instance of the landlord. 22. The more important question, how-ever, is whether the tenants can be asked to vacate the premises on their failure to pay the rent at the aforesaid enhanced rent, on the basis of the agreement before the Controller, without anything more. @page-HP52 23. To answer this question, one has to look at the provisions of the Act again. Even though there is no specific provision permitting the parties to amend their pleadings in proceedings under the Act, such a prayer for amendment is entertained and considered, following the modality contemplated by the provisions of Order 6 Rule 17 of the Code of Civil Procedure. That is on the basis of the acceptance of the principles enshrined in the Code of Civil Procedure. There is nothing, in a pending petition seeking ejectment of a tenant under Section 14(2) of the Act, precluding the landlord from seeking amendment of his petition and bringing before the Court future default on the part of the tenant, for a period subsequent to the date of institution of the petition under S. 14(2) of the Act. This would suggest that the fact of default in payment of rent, agreed upon by the tenant, for a period subsequent to the institution of the petition under Section 14(2), can be made the basis for claiming ejectment of a tenant in case the landlord is permitted to amend his claim in the petition in that respect by the Rent Controller. 24. When a landlord is permitted to amend a petition, in the manner aforesaid, the tenant gets a right to meet the case put forward by the landlord by amending his own defence. That may give rise to a further issue between the parties relating to the failure on the part of the tenant to pay the amount of rent agreed upon between him and the landlord for a period subsequent to the initial institution of the petition. If such an issue can be brought before the Court, by amendment of the pleadings, it would have to be adjudicated upon by the Rent Controller. If such an issue can be brought before the Court, by amendment of the pleadings, it would have to be adjudicated upon by the Rent Controller. All this is consistent with the normal procedure followed by the courts in disposing of the suits brought before them. 25. Since, as we have mentioned earlier, it is possible for the parties to bring a sub-sequent event, as an issue, before the Rent Controller for trial by seeking amendment of the pleadings, it should be possible for the landlord to put forward before the Rent Controller a case for the eviction of the tenant from the demised premises on the ground of default in payment of rent enhanced by agreement by seeking amendment of the pleadings. Where the Rent Controller permits the landlord to do so, the tenant would have an opportunity of meeting the case of alleged failure on his part to pay the amount of rent for the period indicated by the landlord through the amendment. The matter would then be gone into by the Rent Controller and a decision taken on the basis of the pleadings and the evidence brought before him. 26. In conclusion we would hold that it is possible for the landlord and the tenant to agree to a rate of rent different from the one initially agreed upon between them even during the pendency of the proceedings before the Rent Controller under S. 14(2) of the Act. We also hold that before the fact that a tenant has fallen in arrears of rent on the rate so agreed upon can be pleaded, the landlord would have to seek amendment of his petition and, if permitted, the matter would have to be gone into by the Rent Controller in accordance with law. 27. In sum, the revision shall stand finally disposed of with the direction that the Rent Controller will deal with the case only within the confines of the observations contained in our judgment. Parties are, however, left to bear their own costs. Order accordingly.