M. P. Rajya Beej Avam Farm Vikas Nigam. v. Manohar Lal Rathi.
2006-03-23
K.K.LAHOTI, MANJUSHA P.NAMJOSHI
body2006
DigiLaw.ai
Judgment ( 1. ) THIS is an appeal by tenants against the judgment and decree dated 19th March, 1999 by the District Judge, Chhindwara in Civil Suit No. 2-A/1998, by which the suit of plaintiffs has been decreed partially against the appellants and the Trial Court has granted decree for Rs. 4,89,000/against the appellants in respect of arrears of rent. ( 2. ) THE landlord has also filed cross-objections under Order 41 Rule 22 of the Code of Civil Procedure, 1908, aggrieved by the partial dismissal of the suit by which the Trial Court has declined to grant interest on the arrears of rent in their favour. ( 3. ) THE case of the plaintiffs/respondents as stated in the plaint is that the plaintiffs are joint owners of a property known as Bhilma Mill, at Chhindwara-Siwani Road, Chhindwara All the plaintiffs are having defined share in the property, as stated by the plaintiffs in Para 1 of the plaint. Respondent No. 1 is a Corporate Body having its head office at Bhopal. The branch of defendant No. 1 is situated in the premises of plaintiffs. This Branch is engaged in the business of sale, purchase of seeds, and storage etc. The defendant No. 1 is having its Incharge Officer at Chhindwara. ( 4. ) THE Incharge Officer of defendant No. 1 took the property of the plaintiffs on rent on behalf of defendant Nos. 1 and 2, comprising constructed godown of 16,450 Sqf. and adjoining open land admeasuring 45,669 sqf. This property was taken by the respondents in May, 1995 on rent of which possession was obtained by the defendants on 4th March, 1995. Since then, the defendants are carrying on their business in the aforesaid accommodation. ( 5. ) THE tenancy of the defendants is as per English calendar month. The Collector, Chhindwara on 4-10-1996 fixed the rent of the accommodation at the rate of Rs. 31,000/- per month. This rent was fixed by the Collector on the request of defendants vide their letter dated 16-11-1995. This rent was payable by the defendants on 10th day of every succeeding English calendar month. Other plaintiffs have appointed plaintiff No. 1 as Power of Attorney Holder, who collected rent from the defendants. Defendant No. 2 had paid Rs. 31,000/- to plaintiff No. 1 for necessary repairs and make the building upto the mark, by way of advance rent.
This rent was payable by the defendants on 10th day of every succeeding English calendar month. Other plaintiffs have appointed plaintiff No. 1 as Power of Attorney Holder, who collected rent from the defendants. Defendant No. 2 had paid Rs. 31,000/- to plaintiff No. 1 for necessary repairs and make the building upto the mark, by way of advance rent. This amount was paid by way of two cheques of Rs. 20,000/- and Rs. 11,000/ -. The defendants have paid rent of the months of May and June, 1995 by cheques as described in Para 5 of the plaint and on 7-10-1996, the defendants informed to the Power of Attorney Holder of the plaintiffs to issue receipt of the aforesaid cheques. Thereafter the defendants were not regular in payment of rent and the rent of July, 1995 was not paid in spite of demand, and avoided payment of rent. Thereafter the defendants have issued certain cheques separately as per share of the plaintiffs on 29-3-1997 after deducting income-tax. As the plaintiffs had paid income-tax, so the plaintiffs had returned the cheques to defendant No. 2 and intimated to pay entire rent. Thereafter, though the defendants issued cheques to the plaintiffs as per their share, but on presentation of the cheque, it was returned back without any payment. Thereafter, the plaintiffs again made request for the payment of the rent. The defendants issued another cheque to plaintiff No. 6 for her share which was realised. Thereafter on 29-4-1998, the defendants offered the rent of accommodation at the rate of Rs. 19,000/- per month and issued various cheques to the plaintiffs according to their shares. The details of the cheques are given in Para 11 of the plaint. Thereafter the rent was not paid regularly and an amount of Rs. 4,89,000/-accumulated due on the defendants. The plaintiffs made various demands for the payment of the rent, but it was not paid, so the present suit has been filed by the plaintiffs claiming aforesaid amount along with 18% interest. The total claim of Rs. 6,56,000/- was lodged in the Trial Court. On the aforesaid amount, the plaintiffs have also prayed for the payment of 18% per annum interest by way of damages. A chart showing arrears of rent is also enclosed along with the plaint. ( 6. ) THE defendants contested the case on various grounds.
The total claim of Rs. 6,56,000/- was lodged in the Trial Court. On the aforesaid amount, the plaintiffs have also prayed for the payment of 18% per annum interest by way of damages. A chart showing arrears of rent is also enclosed along with the plaint. ( 6. ) THE defendants contested the case on various grounds. In nutshell, the case of the defendants, as stated in the written statement, is as under: (i) That the suit accommodation of godown admeasuring. . . and open land 45,689 sqf was not disputed but it is stated that the godown was not in a fit condition so, Power of Attorney Holder was asked to get it repaired. The Power of Attorney Holder demanded some advance amount which was to be adjusted subsequently in the rent and defendant No. 2 has paid Rs. 31,000/- to the plaintiffs. The open land adjoining to the godown is used from gate to godown only for the purpose of tractor and trolley coming to the godown. The rent was got settled by the plaintiff No. 1 Manohar Lal Rathi with special effort of Collector, Chhindwara. The open land was not used by the defendants for their business. In the circumstances, there was no question of payment of rent of the open land so, the defendants prayed to the Collector, Chhindwara to fix the rent afresh after leaving the open land. On the request of the defendants, the Collector, Chhindwara fixed the rent of the godown at the rate of Rs. 19,000/- per month but the plaintiffs refused to accept the rent and insisted for the payment of Rs. 31,000/- p. m. In fact, the plaintiffs without any use of the land are insisting for recovery of the rent of open land, which is illegal. The defendants are not using the open land, then there is no question of payment of rent to the plaintiffs. The plaintiffs when tried their level best to recover the rent at the rate of Rs. 31,000/-, but after failure in their all the efforts filed the present suit. The plaintiffs are not entitled for the rent of open land . (ii) The payment of rent is also accepted by the defendants, but the adjustment by the plaintiffs in the manner in which it is pleaded in the plaint has been specifically denied.
31,000/-, but after failure in their all the efforts filed the present suit. The plaintiffs are not entitled for the rent of open land . (ii) The payment of rent is also accepted by the defendants, but the adjustment by the plaintiffs in the manner in which it is pleaded in the plaint has been specifically denied. The defendants have also denied that the monthly rent is Rs. 31,000/- but in fact it is only Rs. 19,000/- per month. The defendants have never denied the rent and the allegations of the plaintiffs in respect of non-payment of the rent is incorrect. (iii) The Collector has rightly fixed rent of the accommodation as Rs. 19,000/- per month and on the aforesaid rate, defendants are ready to pay the rent to the plaintiffs. (iv) In Para 9 of the written statement, it is specifically stated that there were no negotiations between plaintiffs and defendants in respect of rate of rent. The Collector initially fixed the rent Rs. 31,000/-, but subsequently, when the open land was not used by the defendants, the rent was fixed as Rs. 19,000/- which has been paid by the defendants to the plaintiffs. (v) As the open land is not in use of defendants, the plaintiffs are not entitled any rent of the aforesaid open land, (vi) That the plaintiff No. 1 Mohan Lal Rathi has been removed by other plaintiffs as power of Attorney Holder, hence the rent was sent to all the plaintiffs as per their share. The rent was sent to the plaintiffs as all belong to one family and most of them are ladies. (vii) The income tax was deduced as per Rules and after deduction of the income tax, the rent was offered which was refused by the plaintiffs. Thereafter the rent was sent without deducting any income tax. (viii) That the rent as soon as it is fixed by the Collector at the rate of Rs. 19,000/- was immediately sent to the plaintiffs in which there was no fault on the part of the defendants. In additional pleas: It is stated that (a) the Collector, Chhindwara is necessary party in the case. (b) That there is no cause of action for filing of the present suit and the suit is liable to be dismissed. (c) The initial rent fixed by the Collector, Chhindwara as Rs. 31,000/- has been modified by Rs.
In additional pleas: It is stated that (a) the Collector, Chhindwara is necessary party in the case. (b) That there is no cause of action for filing of the present suit and the suit is liable to be dismissed. (c) The initial rent fixed by the Collector, Chhindwara as Rs. 31,000/- has been modified by Rs. 19,000/- and the plaintiffs are bound with the order of the Collector. On the aforesaid grounds, the suit was contested . ( 7. ) THE Trial Court framed six issues in the case. In the evidence, the plaintiffs examined P. W. 1 Manohar Lal, P. W. 2 Anil, and P. W. 3 Lalit Kumar while the defendants examined D. W. 1 Mahendra Kumar, Dy. Regional Manager at Chhindwara, and D. W. 2 Ajay Pratap Singh, who was Incharge Officer on behalf of Seed Nigam at Chhindwara. Various documents were filed by the parties. The Trial Court considering the aforesaid recorded following findings: (a) That the defendants are tenants of the accommodation containing godown area 16450 Sqft. and open land 45689 Sqft. (b) That the defendants after getting the aforesaid accommodation on rent were put into possession by the plaintiffs. (c) That the rent of the accommodation was fixed by the Collector, Chhindwara at the rate of Rs. 31,000/- per month vide Annexure P-1, dated 4th October, 1996 which was duly accepted by the defendants vide order dated 7-10-1996 by tendering rent at the rate of Rs. 31,000/ -. (d) That the defendants are using the open land for their business. This fact has been accepted by D. W. 2 Ajay Pratap Singh who admitted that the defendants took possession of godown and open land from the plaintiffs. (e) That the rent Rs. 19,000/- p. m. was fixed without any consent of plaintiffs nor plaintiffs were noticed before reducing the rent from Rs. 31,000/- to Rs. 19,000/- by the Collector. (f) That the defendants have not surrendered the tenanted premises, which is open land to the plaintiffs and until and unless, the land is surrendered to the plaintiffs, the rent of the accommodation cannot be reduced. (g) That the defendants are depositing rent from 1995 at the rate of Rs. 19,000/- and have not paid the deficient rent at the rate of Rs. 12,000/-p. m. The defendants are in arrears of rent since May, 1995 to April, 98 for 36 months Rs.
(g) That the defendants are depositing rent from 1995 at the rate of Rs. 19,000/- and have not paid the deficient rent at the rate of Rs. 12,000/-p. m. The defendants are in arrears of rent since May, 1995 to April, 98 for 36 months Rs. 11,16,000/- but after deducting the paid rent, Rs. 6,27,000/-, the plaintiffs are entitled for Rs. 4,89,000/ -. (h) That the Court denied the interest on the rent Rs. 1,66,000 considering the peculiar facts and circumstances of the case . ( 8. ) RECORDING the aforesaid findings, the Trial Court decreed the suit of plaintiffs/respondents for recovery of Rs. 4,89,000/- but dismissed the suit for recovery of interest at the rate of 18 per cent on the aforesaid arrears of rent. ( 9. ) THE defendants are aggrieved by the judgment and decree passed by the Trial Court so far it held that the defendants are the tenants of accommodation at the rate of Rs. 31,000/- and granting decree in favour of the plaintiffs for Rs. 4,89,000/- have preferred this appeal. ( 10. ) THE plaintiffs/respondents also preferred cross-objection under Order 41 Rule 22, CPC claiming interest on the arrears of rent. ( 11. ) THE learned Counsel appearing for the appellants has challenged judgment and decree passed by the Trial Court on the grounds: (a) that the accommodation was obtained by the defendants/appellants on rent. Though the rent @ Rs. 31,000/- p. m. was fixed by the Collector on 4-10-1996, but land was not in use of the appellants, so the Collector on the request of appellants has rightly refixed rent on 26-6-1998 at the rate of Rs. 19,000/- which order was never challenged by the plaintiffs and the Trial Court erred in decreeing the suit at the rate of Rs. 31,000a per month. When the land was not in use of the defendants, it makes no difference that it was surrendered or not, and the plaintiffs was not entitled to claim rent of the aforesaid open land, which was not used by the defendants. (b) That the power of attorney in favour of plaintiff No. 1 was cancelled which fact has been admitted by P. W. 1 in Para 6 of his statement. In these circumstances, all the plaintiffs ought to have appeared in the witness box to prove the case. In absence of which, the suit ought to have been dismissed .
(b) That the power of attorney in favour of plaintiff No. 1 was cancelled which fact has been admitted by P. W. 1 in Para 6 of his statement. In these circumstances, all the plaintiffs ought to have appeared in the witness box to prove the case. In absence of which, the suit ought to have been dismissed . ( 12. ) THE learned Counsel appearing for respondents supported the judgment and decree and submitted that: (a) The entire accommodation including constructed godown and open land was given on tenancy. The tenancy was accepted and the appellants/defendants were put into possession of the entire area of godown and open land. It is not in dispute that the said land was never surrendered in favour of the plaintiffs. In absence of any surrender in favour of the plaintiffs, mere non-using of the land will not be a ground to reduce the rent. (b) The Trial Court erred in not granting interest to the plaintiffs. Under Section 3 of the Interest Act, the plaintiffs were entitled to claim interest on the aforesaid arrears of rent. (c) The accommodation is situated in Chhindwara where Madhya Pradesh Accommodation Control Act, 1961 is applicable. Under Section 12 (1) (a) of the Act, 1961 (hereinafter referred to as the Act), the tenant was under an obligation to pay rent month to month. In case of non-payment of rent, the landlord was entitled to serve a notice for the payment of rent and the tenant was under an obligation to pay rent within two months from the date of receipt of the notice. In these circumstances, if the rent is not paid within a period of two months from the date of receipt of the notice, the landlord was entitled for interest on the aforesaid amount. The landlord has been deprived with the benefit of the money, which was payable by the appellants by way of rent and for a considerable long period, the rent was not paid. In these circumstances, the landlord was entitled to claim interest and rightly claimed interest at the rate of 18 per cent which was prevalent in the Bank at that time. (d) The accommodation was used by the tenant for commercial purposes. There is finding that the open land was used by the tenant for the stand of tractor, trolley etc. which were coming to the godown.
(d) The accommodation was used by the tenant for commercial purposes. There is finding that the open land was used by the tenant for the stand of tractor, trolley etc. which were coming to the godown. The labourers were also using the open land for cleaning, sorting, packing of grains and other purposes. Apart from this, when the tenants have taken entire accommodation on rent, it hardly matters whether any part of the accommodation is used by the tenants for the purpose for which it was taken on rent. After obtaining the accommodation on rent, the tenant cannot absolve from the liability to pay rent merely on the ground that the accommodation was not used by the tenant, until and unless the accommodation is surrendered in favour of the landlord by express or implied surrender, the tenant is liable to pay the rent . ( 13. ) TO appreciate rival contentions of the parties, firstly, the question may be seen what accommodation was let out to the appellants. (i) The plaintiff P. W. 1 in Para 1 of his statement has very specifically stated that the two godowns having area 16,500 and open land which was nearabout 45500 was let out to the defendants and the Collector had fixed the rent at the rate of Rs. 31,000/- per month for both. In this regard, the letter of Collector was received by him Annexure P-1. In Para 4 of the statement, he has very specifically stated that the defendants are using the entire open land and the godown. The defendants have not intimated to the plaintiffs in respect of non-user of open land, on the contrary, the entire land is being utilised by the defendants for their processing work which is collection of seeds, processing and packing. Both the godown and open land were given on tenancy simultaneously. In Para 8 of the statement, he has denied that the defendants after obtaining possession of open land intimated to the plaintiffs that they did not require any open land. (ii) P. W. 2 Anil in Para 2 of his statement has stated that the defendants were given godown and open land. The open land is being utilised by the labourers for cleaning grains, assorting it and packing etc. In the cross-examination, this factum has not been challenged.
(ii) P. W. 2 Anil in Para 2 of his statement has stated that the defendants were given godown and open land. The open land is being utilised by the labourers for cleaning grains, assorting it and packing etc. In the cross-examination, this factum has not been challenged. (iii) P. W. 3 Lalit Kumar has also supported the fact that open land is being utilised by the defendants/appellants for the purpose of processing of the grain. He has also stated that since last 3-4 years, he has seen utilisation of open land by the labourers of defendants. In the cross-examination in Paras 3 and 4 he has supported the same factum. (iv) D. W. 1 Mahendra Kumar has stated that the godown was obtained by the defendants on tenancy. In Para 2 of his statement, he has stated that the land in front of the godown was used for a year for cleaning of Soyabean. The only part of land in front of the gate to godown is being utilised for the purpose of passage of vehicles like tractor trolley. He has stated that the Managing Director instructed him that the open land is not utilised by the Seed Nigam, so the Collector be applied for refixation of the rent. On this, he filed an application to the Collector on 16-9-1997 and the Collector vide order dated 18-4-98 refixed rent at the rate of Rs. 19,000/- per month. Thereafter he instructed to A. K. Singh that since the date when the Godown was taken on rent, the plaintiffs be paid rent at the rate of Rs. 19. 000/- p. m. and the same rent was paid and still the rent is being paid with the same rate. Ex. D-1 is the order of the Collector by which the rent was fixed. In the cross-examination, he has submitted that the tractors which are coming to Godown, they are parked in the open land, but he has denied that the open land is being utilised by the Labourers for cleaning the grains. In the cross-examination he was drawn attention in respect of photographs (Exs. P-19 to P-23) in which on the open land the labourers are shown working in front of godown on open land.
In the cross-examination he was drawn attention in respect of photographs (Exs. P-19 to P-23) in which on the open land the labourers are shown working in front of godown on open land. He has admitted this fact that in the photographs, the labourers of defendants are working on the open land, but in Para 4, he has stated that the land was not taken on rent by the defendants for cleaning the grain, but it was taken only for the purpose of passage for the vehicles. He was confronted with Para 3 of the written statement in which it is stated that "this fact is correct that the defendants have taken 16450 Sqf. constructed godown and 45689 open land on monthly rent and they are doing their business, but handing over possession to defendant No. 2 is not correct". He accepted that this fact has been correctly stated in the written statement as per record of the office. In Para 6, he has admitted that till date the plaintiffs were not intimated in writing that open land has been surrendered or they are not utilising it. Though he has stated that orally it was stated to M. L. Rathi. In Para 7, he has stated that A. P. Singh was incharge of the Centre and initial letter was sent by him for fixing the rent to the Collector, which includes the open land. He has also admitted that on the basis of this letter, the Collector had fixed rent at the rate of Rs. 31,000/- p. m. The rent of godown and open land was cumulatively fixed. (v) D. W. 2 A. P. Singh in Para 1 of his statement has stated that from plaintiff M. L. Rathi, there were negotiations in respect of obtaining godown on rent and also open land. The rent was settled at the rate of Rs. 2/- Sqf. and the rent was payable after its approval from the Managing Director. In this regard he wrote a letter to M. L. Rathi and also wrote to the Collector, Chhindwara for fixing the rent. The Collector fixed the rent at the rate of Rs. 31,000/- p. m. He obtained possession of godown and open land from the plaintiffs. The open land is also utilised causally.
In this regard he wrote a letter to M. L. Rathi and also wrote to the Collector, Chhindwara for fixing the rent. The Collector fixed the rent at the rate of Rs. 31,000/- p. m. He obtained possession of godown and open land from the plaintiffs. The open land is also utilised causally. In Para 2, he stated that the Head Officer asked that the open land is not utilised, so the rent has been wrongly fixed. Thereafter the Collector was again asked to fix the rent and the Collector fixed the rent @ Rs. 19,000/- p. m. and thereafter the plaintiffs are being paid the rent @ Rs. 19,000/- per month. He had also made certain complaints in respect of seepage and repairs. In Para 4, he stated that in one year for one month the open land was used for cleaning grains. Their labourers are utilising 50 x 60 feet land. In Para 4, he has specifically stated that the plaintiffs were intimated in writing to take back possession of the land. But no document has been filed. The defendants have not handed over possession of the open land. He was authorised to negotiate with plaintiffs and negotiated with plaintiff M. L. Rathi for 16,400 Sqf. godown land and 45789 Sqf. open land. For the same land, the Collector was written a letter to fix the rent and the Collector as per Ex. P-1 fixed the rent at the rate of Rs. 31,000/-p. m. Thereafter the defendants were utilising the open land for cleaning the grains and on the date of statement, the open land was utilised for cleaning of grains . ( 14. ) FROM the perusal of Ex. P-1, the letter dated 4-10-1996 of the Collector by which the Collector had fixed the rent at the rate of Rs. 31,000/-p. m. for godown having carpet area 16,450 Sqf. and open area 45,609 Sq. feet. This order was passed in continuation to letter dated 16-11-1995 of the appellants and copy of this order was sent to the plaintiff M. L. Rathi. By Annexure Ex. P-2 on 7-10-96, the defendants intimated plaintiffs that the Collector has fixed the rent of godown and open land at the rate of Rs. 31,000/- and the rent of May and June was Rs. 62,000/ -. Rs. 20,000/- had been paid by two advance cheques and remaining Rs.
By Annexure Ex. P-2 on 7-10-96, the defendants intimated plaintiffs that the Collector has fixed the rent of godown and open land at the rate of Rs. 31,000/- and the rent of May and June was Rs. 62,000/ -. Rs. 20,000/- had been paid by two advance cheques and remaining Rs. 42,000/- has been paid by cheque dated 7-10-96 bearing No. 0064947 and the plaintiffs were asked to issue receipt of it. By Ex. D-1, dated 16-4-1998, the Collector refixed rent of the godown for Rs. 19,000/- p. m. in continuance to the letter dated 16-9-1997 of the appellant who intimated the Collector that the open land is not being utilised, so the rent be reduced. The aforesaid facts clearly show that the appellants had obtained godown and open land on tenancy and possession of the land and godown both were handedover to the appellants. Thereafter the Collector, Chhindwara fixed the rent at the rate of Rs. 31,000/- p. m. for both at the request of defendants. The letters Annexures P-1 and D-1 both show that the initial rent was fixed for godown and open land by the Collector and the appellants took the possession prior to it of both the accommodation. In these circumstances, when the tenancy was agreed for both open land and godown, there was no question of reducing the rent confining it to godown. If the open land was without any utility to the appellants, the appellants ought to have surrendered to the plaintiffs and possession ought to have been handed over to the plaintiffs. The plaintiffs have very specifically stated that possession of the open land was handed over to the appellants and this was not surrendered by the appellants. That D. W. 1 in Para 6 also admitted this fact that plaintiffs were never intimated that the open land was surrendered or it was not utilised by the defendants. In these circumstances, until and unless by express or implied surrender, the lease of open land is determined, the appellants are liable to pay the rent to the plaintiff. Section 111 of this Transfer of Property Act prescribes the mode for determination of the lease. For ready reference Section 111 of the Act is quoted hereinunder: 111.
In these circumstances, until and unless by express or implied surrender, the lease of open land is determined, the appellants are liable to pay the rent to the plaintiff. Section 111 of this Transfer of Property Act prescribes the mode for determination of the lease. For ready reference Section 111 of the Act is quoted hereinunder: 111. A lease of immovable property determines.- (a) by efflux of the time limited thereby; (b) where such time is limited conditionally on the happening of some event - by the happening of such event; (c) where the interest of the lessor in the property terminates on, or his power to dispose of the same extends only to, the happening of any event - by the happening of such event; (d) in case the interests of the lessee and the lessor in the whole of the property become vested at the same time in one person in the same right; (e) by express surrender, that is to say, in case the lessee yields up his interest under the lease, to the lessor by mutual agreement between them; (f) by implied surrender; (g) by forfeiture, that is to say,- (1) in case the lessee breaks an express condition which provides that, on breach thereof, the lessor may re-enter; or (2) in case the lessee renounces his character as such by setting up a title in a third person or by claiming title in himself; or (3) the lessee is adjudicated an insolvent and the lease provides that the lessor may re-enter on the happening of such event; and in any of these cases the lessor or his transferee gives notice in writing to the lessee of his intention to determine the lease; (h) on the expiration of a notice to determine the lease, or to quit, or of intention to quit, the properly leased, duly given by one party to the other. Under Clause (e) and Clause (f) of Section 111, it is apparent that a lease of immovable property determines by express surrender by mutual agreement between lessee and lessor or by implied surrender, but in this case without any such surrender, the lease cannot be determined.
Under Clause (e) and Clause (f) of Section 111, it is apparent that a lease of immovable property determines by express surrender by mutual agreement between lessee and lessor or by implied surrender, but in this case without any such surrender, the lease cannot be determined. If the land was not utilised or was of no utility to the appellants, they ought to have surrendered to the plaintiffs expressly by writing or by implied surrender or by rehanding over possession of the land to the plaintiffs, but until and unless such recourse is adopted, the appellants were tenants of the entire accommodation and the lease is not determined. In these circumstances, the appellants are liable to pay rent for land also and the rent cannot be reduced to Rs. 19,000/- confining it to godown only. Apart from this, as per statement of plaintiffs and the admission of the defendants that the land is still being utilised by the appellants, there is no implied surrender. The appellants, are still using land for their business purpose and the case of defendants that the land is not utilised is not proved. The Collector, Chhindwara fixed the rent at the rate of Rs. 3l,000/- for godown and open land, which was accepted by both the parties. Thereafter, if the appellants were of the view that the rent deserves to be reduced and they wrote a latter to the Collector, it was their duty to intimate the plaintiffs in this regard without any intimation or hearing to the plaintiffs the rent has been reduced, it was illegal and the plaintiffs are not bound by subsequent order Ex. D-1. Even the Collector before reducing the rent had not intimated to the plaintiffs in this regard. In view of the aforesaid discussion, the Trial Court has rightly found that the entire accommodation is in possession of the appellants and the rate of rent is Rs. 31,000/- p. m. for which appellants are liable to pay to the plaintiffs. In this regard, the decree passed for Rs. 4,89,000/- in favour of the plaintiffs needs no interference . ( 15. ) NOW the second question arises whether the plaintiffs are entitled for interest on the aforesaid amount ? The case of plaintiffs is that the rent was payable month to month, but the appellants have not paid the amount within time.
4,89,000/- in favour of the plaintiffs needs no interference . ( 15. ) NOW the second question arises whether the plaintiffs are entitled for interest on the aforesaid amount ? The case of plaintiffs is that the rent was payable month to month, but the appellants have not paid the amount within time. Under Section 12 (1) (a) of the M. P. Accommodation Control Act, 1961, the rent was payable within two months from the date on which a notice of demand for payment of arrears of rent was served on the tenant by the landlord. For ready reference Section 12 (1) (a) of the Act is quoted as under: 12. (1) (a) that the tenant has neither paid or tendered the whole of the arrears of the rent legally recoverable wolfram him within two months of the date on which a notice of demand for the arrears of rent has been served on him the landlord in the prescribed manner. The tenant was bound to tender the entire arrears of rent within a period of two months from the date of receipt of the notice. In this case, the plaintiffs for the first lime issued a written intimation to the appellants (Ex. P-3), dated 28-24997 for the payment of rent. Thereafter on 29-3-97 by Annexure P-4, on 8-4-97 by P-6, on 13-11-1996 by Annexure P-7 made request to the appellants to pay rent, but the rent was not paid. Thereafter the present suit was filed for recovery of the rent on 14-5-98. As per discussion hereinabove, the due rent on the appellants was Rs. 4,89,000/- for which the plaintiffs were entitled. The aforesaid huge amount was withheld by the appellants on wrong pretext that for the Collector has refixed the rent for Rs. 19,000/- per month, which was apparently ex parte order without intimating to the plaintiffs. The statutory provision is very specific that the tenant is under obligation to tender entire arrears of rent within a period of two months from the date of receiving demand, but in this case, appellants failed to pay rent to the landlord even on repeated demand. Admittedly, in this case, there is no contract between the parties for the payment of interest on the arrears of rent. The learned Counsel for respondents has placed reliance to Section 3 of the Interest Act, 1978, which reads as under: 3.
Admittedly, in this case, there is no contract between the parties for the payment of interest on the arrears of rent. The learned Counsel for respondents has placed reliance to Section 3 of the Interest Act, 1978, which reads as under: 3. Power of Court to allow interest.- (1) In any proceedings for the recovery of any debt or damages or in any proceedings in which a claim for interest in respect of any debt or damages already paid is made, the Court may, if it thinks fit, allow interest to the person entitled to the debt or damages or to the person making such claim, as the case may be, at a rate not exceeding the current rate of interest, for the whole or part of the following period, that is to say, (a) if the proceedings relate to a debt payable by virtue of a written instrument at a certain lime, then, from the dale when the debt is payable to the date of institution of the proceedings; (b) if the proceedings do not relate to any such debt, then, from the date mentioned in this regard in a written notice given by the person entitled or the person making the claim to the person liable that interest will be claimed, to the date of institution of the proceedings: Provided that where the amount of the debt or damages has been repaid before the institution of the proceedings, interest shall not be allowed under this section for the period after such repayment. (2) Where, in any such proceedings as are mentioned in sub-section (1), (a) judgment, order or award is given for a sum which, apart from interest or damages, exceeds four thousand rupees, and (b) the sum represents or includes damages in respect of personal injuries to the plaintiff or any other person or in respect of a persons death, then, the power conferred by that sub-section shall be exercised so as to include in that sum interest on those damages or on such part of them as the Court considers appropriate for the whole or part of the period from the date mentioned in the notice to the date of institution of the proceedings, unless the Court is satisfied that there are special reasons why no interest should be given in respect of those damages.
(3) Nothing in this section, (a) shall apply in relation to (i) any debt or damages upon which interest is payable as of right, by virtue of any agreement; or (ii) any debt or damages upon which payment of interest is barred, by virtue of an express agreement; (b) shall affect, (i) the compensation recoverable for the dishonour of a bill of exchange, promissory note or cheque, as defined in Negotiable Instruments Act, 1881; or (ii) the provisions of Rule 2 of Order II of the First Schedule to the Code of Civil Procedure, 1908; (c) shall empower the Court to award interest upon interest. Section 3 provides that in a proceeding for the recovery any debt or damages or in any proceedings in which a claim for interest in respect of any debt or damages already paid is made, the Court may if it thinks fit allow interest payable to the sum at the rate not exceeding current rate of interest for the whole or part of the rate . ( 16. ) IN this case, the rent was fallen due on the succeeding month and was not paid in spite of various demands. The appellants have wrongfully withheld the money which was payable to the plaintiffs long back. The plaintiffs were deprived to use the money, which was payable immediately in the next month, on falling due. Though there is no agreement between the the parties but in absence of any agreement between the parties, the interest on arrears of rent may be awarded by way of damages for wrongful withholding of money, though it cannot be claimed under the Contract Act. The appellants have withheld the rent amount for a considerable long period. If this amount could have been paid to the plaintiffs within time, the plaintiffs must have utilised this amount for their purposes. The appellants are using the premises for commercial purposes and ought to have tendered rent within the reasonable period. In these circumstances, the plaintiffs are entitled for reasonable interest on the aforesaid amount by way of damages on the rent which fallen due long back. Since May, 1995 the amount was not paid fully and was paid partly. The plaintiffs are entitled for interest by way of damages on the aforesaid amount, which is quantified Rs. 6 per cent per annum on the due amount.
Since May, 1995 the amount was not paid fully and was paid partly. The plaintiffs are entitled for interest by way of damages on the aforesaid amount, which is quantified Rs. 6 per cent per annum on the due amount. As first time, the rent was demanded in writing by the plaintiffs on 28-2-97 by Ex. P-3 and the appellants were under obligation to pay it on or before 28-4-97, which was not paid. In these circumstances, the plaintiffs are entitled for interest from 28-4-97 on the aforesaid amount. Considering the period and the present rate of interest, it will be proper if the landlord is allowed 6% per annum interest on the aforesaid arrears of rent of the amount. ( 17. ) IN the result, the appeal filed by the appellants/tenant is hereby dismissed, but the counter claim made by the landlord respondents is hereby allowed and following decree is passed: (i) The judgment and decree passed by the District Judge by which a decree for payment of Rs. 4,89,000/- has been passed against the appellants is hereby affirmed. (ii) On the aforesaid amount, the landlord shall be entitled interest at the rate of 6 per cent per annum from 28-4-1997 till the date of payment by the respondents. (iii) The respondents shall be entitled for the cost of the suit and counter-claim apportionately from the appellants. Counsels fee Rs. 2,000/- if certified .