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2011 DIGILAW 1447 (BOM)

Indian Oil Corporation Limited v. Vijay

2011-11-29

R.K.DESHPANDE

body2011
Judgment : 1. The Resident Deputy Collector & House Rent Controller, Akola, granted permission to the respondent No.1-landlord to terminate the tenancy of the petitioner-tenant under clauses 13(1) and 13(3)(ii) and (vi) of the C.P. & Berar Letting of Premises and Rent Control Order, 1949 (for short, “the Rent Control Order”) in R.C. Case No.BRA 13(3)/AKL/1/2008-89. This was the subject-matter of challenge in Appeal No.BRA-13(3)/Akola/1/2009-10 filed under Section 21 of the Rent Control Order before the Additional Collector, Akola, as an Appellate Authority, and the same was partly allowed by an order dated 30-9-2010, maintaining the permission granted under clause 13(3)(ii) of the said Order. Hence, both these orders are subject-matter of challenge in this petition at the instance of the tenant. The subject-matter of dispute is the portion of 10,710 sq.ft. of Plot No.2, Nazul Sheet No.55, situated at National Highway No.6 at Akola, and another portion of the said plot admeasuring 3,410 sq.ft. leased out under the lease-deed dated 16-12-1969 registered on 12-3-1970. 2. The facts in detail are as under: The annual lease in respect of the suit property expired on 15-4-1985. The respondent No.1-landlord issued a notice dated 10-4-1985 calling upon the petitioner-tenant to deliver the vacant possession of the suit premises on the ground of expiry of lease period. Regular Civil Suit No.298 of 1985 was filed for eviction and possession on 14-4-1985. During the pendency of the suit, the petitioner-tenant forwarded demand draft No.203963 dated 20-7-1985 for the payment of rent for the period from 16-4-1985 to 15-4-1986. The rent was at the rate of Rs.7,620/-payable per annum and it was forwarded under the covering letter dated 7-8-1985. The respondent No.1-landlord, in his reply dated 22-8-1985, informed the petitioner-tenant that he cannot accept the demand draft towards rent and he was willing to accept the said amount towards damages to be recovered from the petitioner-tenant, and the response to this, a proposal was called for from the petitioner-tenant. The petitioner-tenant did not respond to this proposal. 3. On 28-4-1989, the suit was decreed for eviction and possession. Regular Civil Appeal No.199 of 1989 was preferred by the petitioner-tenant, which was dismissed on 16-2-1995. The petitioner-tenant did not respond to this proposal. 3. On 28-4-1989, the suit was decreed for eviction and possession. Regular Civil Appeal No.199 of 1989 was preferred by the petitioner-tenant, which was dismissed on 16-2-1995. Thereupon, Second Appeal No.237 of 1995 was filed before this Court, and during the pendency of the said second appeal, an application was moved, being Civil Application No.2173 of 2006, by the respondent-landlord for direction to the petitioner-tenant to deposit the occupation charges at the rate of Rs.7,500/- along with interest at the rate of 10% per annum with effect from 15-4-1985. The said application was decided on 6-9-2006 by this Court, directing the petitioner-tenant to pay to the respondent-landlord directly the arrears of rent from 15-4-1985 at the rate of Rs.7,620/-per year, without prejudice to the rights and liabilities and subject to the proceedings pending before the Court. Subsequently, the said second appeal was disposed of by an order dated 10-4-2008, and taking into consideration the change in the position of law requiring compliance of the provisions of the Rent Control Order, occurring during the pendency of the litigation. The decree passed by the Trial Court was made subject to the grant of permission by the Rent Controller under the provisions of the Rent Control Order. 4. The respondent No.1-landlord accordingly filed an application for permission to determine the tenancy of the petitioner-tenant on the grounds mentioned in Clauses 13(1) and 13(3)(ii) and (vi) of the Rent Control Order. This application was opposed by the petitioner-tenant by filing written statement on 15-12-2008. The respondent No.1-landlord filed an affidavit in lieu of evidence and he was cross-examined by the petitioner-tenant. One Shri Kamalkishore Kalantri, the Deputy Manager of the petitioner, also filed an affidavit in lieu of evidence and he was cross-examined by the respondent No.1-landlord. 5. On 17-11-2009, the Rent Controller passed an order granting permission to determine the tenancy under clause 13(1) read with Clauses 13(3)(ii) and (vi) of the Rent Control Order. It was held that the petitioner-tenant did not exercise its option under clause 13(1) of the Rent Control Order and had developed the habit of remaining in arrears of rent continuously for a long period. It was further held that the respondent-landlord was entitled to an order of eviction also on the ground of bona fide requirement. It was held that the petitioner-tenant did not exercise its option under clause 13(1) of the Rent Control Order and had developed the habit of remaining in arrears of rent continuously for a long period. It was further held that the respondent-landlord was entitled to an order of eviction also on the ground of bona fide requirement. The appeal filed by the petitioner-tenant was thereafter partly allowed by an order dated 30-9-2010, holding that no case for bona fide requirement was made out. It was held that the petitioner-tenant had failed to pay the rent for a period of 22 years and hence was a habitual defaulter. It was also observed that the period of tenancy had expired, but the permission granted only on the ground under clause 13(3)(ii) was maintained by partly allowing the appeal. Hence both these orders are subject-matter of challenge in this petition. 6. The basic question, which arises for determination, is whether the test, as laid down under clause 13(3)(ii) of the Rent Control Order to grant permission to issue notice determining the lease in respect of the suit premises, is satisfied or not. Clause 13(3)(ii) of the Rent Control Order being relevant, is reproduced below: “13(3) If after hearing the parties the Controller is satisfied – … … ... (ii) that the tenant is habitually in arrears with the rent. … … … he shall grant the landlord permission to give notice to determine the lease as required by sub-clause (1).” The Apex Court in its decision in SunderamPillai and others v. V.R. Pattabiraman and others, reported in 1985(1) SCC 591 , dealing with the requirement of wilful default under the Tamilnadu Rent Control Act, has held as under: “Thus, a consensus of the meaning of the words “willful default” appears to indicate that default in order to be willful must be intentional, deliberate, calculated and conscious, with full knowledge of legal consequences flowing therefrom. Taking for instance a case where a tenant commits default after default despite oral demands or reminders and fails to pay the rent without any just or lawful cause, it cannot be said that he is not guilty of wilful default because such a course of conduct manifestly amounts to wilful default as contemplated either by the Act or by other Acts referred to above.” Applying the aforesaid principles in the matter of habitual default under clause 13(3)(ii) of the Rent Control Order, this Court has held in para 13 of its decision in SurendrakumarAmbalal Khatri v. SubhashSitaram Zanwar, reported in 1996(2) Mh.L.J. 1035 , as under: “13. Applying the aforesaid principles it would be clear that non-payment of rent month after month for a period of 11 months despite notice given by the landlord and undertaking given by the tent that he would make the payment of rent regularly every month, the conduct of the tent, obviously would be that the tenant did not make the payment intentionally and his conduct was wilful and deliberate in not making the payment regularly with full knowledge of legal consequences and, therefore, he was habitually in arrears with rent.” The requirement of the said clause was considered by the Apex Court in its decision in RashikLal v. Shah Gokuldas,reported in (1989) 1 SCC 542 , wherein it has been held that the crucial test appears to be the conduct of the landlord in receiving the rent. 7. In view of the aforesaid principles laid down, what is required to be seen is whether there was any default and it was intentional, wilful, deliberate, calculated and conscious with full knowledge of legal consequences. To gather this, the conduct of the parties becomes relevant. The pleadings, evidence and other circumstances also need to be seen. The relevant pleading in respect of habitual default is contained only in para 10 of the application, which is reproduced below: “10. It is further submitted that, the non-applicant is habitual defaulter and had developed habit of remaining into the arrears of the rent and this aspect has been duly proved before the Civil Court and on this Court, the applicant is entitled for the recovery of the possession from the non-applicant.” The petitioner-tenant has denied the contents of the said para and has alleged that he has always been prompt and particular in making the payment. The petitioner-tenant has further taken the stand in response to para 10 above, in para 6 of its written statement, as under: “6) As to Para-10: … It would be pertinent to mention here that on 07/08/1985 the non-applicant had issued a letter to the applicant tendering rent for the suit properties for the period from 01/05/1985 to 31/03/1986 and 16/04/1985 to 15/04/1986. The said letter alongwith the Demand Draft was received by the applicant. However, vide reply dated 22/08/1985 the applicant refused to accept the rent. The applicant had stated in the letter dated 22/08/1985 that he was depositing the Demand Draft towards the damages and not towards rent. It was also stated in the said reply suit for eviction was already filed. In view of the aforesaid, it is absolutely clear that the applicant himself had refused to accept the rent, for which the non-applicant cannot be held responsible. It would be pertinent to mention here that the applicant had filed Civil Application No.2173/2006 in Second Appeal No.237/1995 inter alia praying that the non-applicant be directed to pay occupation charges @ Rs.7,500/- per month with 10% interest w.e.f. 15/04/1985. The said application was disposed of vide order dated 06/09/2006. The Hon'ble High Court was pleased to direct the non-applicant to pay to the applicant arrears of rent w.e.f. 15/04/1985 @ Rs.7,620/- per year. The non-applicant has accordingly deposited the rent with the applicant in compliance of the said order by Demand Draft dated 05/10/2006, which has been received by the applicant. It would be pertinent to mention here that the rent was payable from year to year. The non-applicant was paying the rent regularly as per the agreed terms. The applicant had himself refused to accept the rent as stated above and, therefore, no fault can be found with the non-applicant. The applicant has failed to make out any case of habitual default or arrears of rent. The application is liable to be dismissed.” 8. The entire pleadings in respect of habitual default under clause 13(3)(ii) of the Rent Control Order are contained in para 10 of the application, which is reproduced in its entirety. There is no pleading to show the number of defaults and the period of each default. Though the requirement of annexing the schedule of defaults may not be mandatory, in the absence of pleadings, such schedule could have been prepared and annexed. There is no pleading to show the number of defaults and the period of each default. Though the requirement of annexing the schedule of defaults may not be mandatory, in the absence of pleadings, such schedule could have been prepared and annexed. This has also not been done. There are no details of alleged arrears given in the application. In the absence of pleadings of material facts and particulars constituting habitual default, no amount of evidence could have been permitted to be led. Both the authorities below have ignored this vital aspect of the matter. Hence, on this count alone, the findings cannot be sustained. 9. The pleading is that the petitioner-tenant is a habitual defaulter and had developed a habit of remaining into the arrears of rent, is duly proved before the Civil Court. There is nothing pointed out to substantiate this contention. Even the copy of the judgment or decree passed by the Civil Court is not produced before this Court. Assuming that such a finding is recorded, the same was without jurisdiction, as on the applicability of the Rent Control Order, the competent authority to record the findings on arrears of rent under clause 13(3)(i) and on habitual default under clause 13(3)(ii) of the Rent Control Order is the Rent Controller. Hence, a specific pleading ought to have been made and the evidence to substantiate it, ought to have been led before the Rent Controller, whose jurisdiction was invoked. 10. The Appellate Authority has held that the requirement of clause 13(3)(ii) of the Rent Control Order was satisfied, as the petitioner-tenant has failed to make the payment for the period from 1-5-1985 to 6-9-2006, that is the date on which this Court had passed an order in Second Appeal No.237 of 1995, directing the petitioner-tenant to clear the arrears of rent from 15-4-1985. The Appellate Court has recorded the finding that the petitioner-tenant has committed 22 defaults in payment of rent from 16-4-1985 to 6-9-2006, and, therefore, the respondent-landlord was held entitled to permission under clause 13(3)(ii) of the Rent Control Order. 11. Regular Civil Suit No.298 of 1985 was filed on 14-4-1985. There is not even a whisper about any default in payment of rent alleged to have been committed by the petitioner-tenant prior to 14-4-1985. 11. Regular Civil Suit No.298 of 1985 was filed on 14-4-1985. There is not even a whisper about any default in payment of rent alleged to have been committed by the petitioner-tenant prior to 14-4-1985. The tenancy was annual, the rent was payable in advance, and the petitioner-tenant had offered to make the payment of rent on 7-8-1985 in writing, for the period from 16-4-1985 to 15-4-1986, which has been refused by the respondent-landlord in writing on 22-8-1985. Since the respondent-landlord refused to accept the rent, the petitioner-tenant thereafter did not forward the amount of rent. Thereafter till 26-3-2006, the respondent-landlord did not demand the rent or called upon the petitioner-tenant to pay the rent. It is urged that it was the obligation of the petitioner-tenant to pay the rent and it should have on its own deposited the same in the Court regularly by obtaining such order. The question is not of the deposit by the petitioner-tenant of the rent amount by obtaining the order of the Court, but the question is of the petitioner-tenant developing a mental attitude of non-payment of rent. It is the conscious act of non-payment of rent, knowing full the consequences flowing therefrom and the conduct of the parties. The petitioner-tenant immediately upon passing of the order dated 26-3-2006 on Civil Application No.2173 of 2006 filed in Second Appeal by the respondent-landlord, deposited the entire amount, as directed by this Court. In fact, this Court recorded in the order the willingness of the petitioner-tenant to pay the entire amount and such anxiety to pay the rent is reflected in the order itself. Accordingly, the amount of arrears from 16-4-1985 to 26-3-2006 was paid, as per the order without prejudice to its rights and contention that there was no default, muchless wilful, in paying the rent. It is the conduct of the respondent-landlord, which has deprived him of the rent for the period from 16-4-1985 to 26-3-2006. The petitioner-tenant cannot be blamed for it and the respondent-landlord cannot be permitted to artificially prepare such ground to seek eviction and possession. The insistence of the respondent-landlord, as reflected in reply dated 22-8-1985 was that the petitioner-tenant should pay the amount as damages to which the petitioner-tenant was not agreeable. Failure to pay damages is not the ground for eviction under the Rent Control Order. The insistence of the respondent-landlord, as reflected in reply dated 22-8-1985 was that the petitioner-tenant should pay the amount as damages to which the petitioner-tenant was not agreeable. Failure to pay damages is not the ground for eviction under the Rent Control Order. The Authorities below have, therefore, committed a serious error of law in failing to apply the relevant tests and to record the findings, which are not based upon any pleading and the relevant material on record. 12. From the aforesaid position, it is apparent that there was no default in payment of rent prior to 16-4-1985. The respondent-landlord refused to accept the payment of rent offered by the petitioner-tenant on 7-8-1985 for payment of rent for the period from 16-4-1985 to 15-4-1986. Thereafter there was no demand by the respondent-landlord, calling upon the petitioner-tenant to make the payment of rent till it filed Civil Application No.2173 of 2006 in Second Appeal No.237 of 1995 before this Court. The petitioner-tenant shown its willingness to pay the amount of rent on its own and it had actually paid the same after the order was passed. The order passed on the said Civil Application clearly records that this was all without prejudice to the contentions of the parties. The Appellate Authority has held that there was no default, muchless habitual default, committed by the petitioner-tenant after 5-10-2006. Hence, the Authorities below have committed an error in holding that the requirement of clause 13(3)(ii) was satisfied. The orders passed by the Authorities below granting permission under clause 13(3) (ii) cannot, therefore, be sustained. 13. The Appellate Authority has though observed that clause 13(1)(b) of the said Order was also attracted, there is no permission granted on the said ground. The contention of the learned counsel for the respondent-landlord is that since the finding is recorded in favour of the respondent-landlord on this ground, the permission is deemed to have been granted to determine the tenancy. The contention cannot be accepted, for the reason that there is no order of granting permission under clause 13(1)(b) of the Rent Control Order. The contention of the learned counsel for the respondent-landlord is that since the finding is recorded in favour of the respondent-landlord on this ground, the permission is deemed to have been granted to determine the tenancy. The contention cannot be accepted, for the reason that there is no order of granting permission under clause 13(1)(b) of the Rent Control Order. Apart from this, clause 13(1)(b) of the said Order, which is relevant, is reproduced below: “13(1) No landlord shall, except with the written permission of the Controller -(b) where the lease is determinable by efflux of the time limited thereby, require the tenant to vacate the premises by process of law or otherwise if the tenant is willing to continue the lease on the same terms Bare reading of the aforesaid provision makes it clear that the lease can be continued if the tenant is willing to continue it on the same terms and conditions. In the present case, the lease expired on 15-4-1985, and even prior to that on 10-4-1985, the respondent-landlord called upon the petitioner-tenant to deliver the vacant possession of the suit premises. There is nothing on record to show that the respondent-landlord had made an offer to the petitioner-tenant to continue the lease on the same terms and conditions. There was no occasion for the petitioner-tenant to express its willingness to continue the lease on the same terms and conditions, as the respondent-landlord did not want the petitioner-tenant to be continued in the premises in question. Both the Authorities below have ignored these relevant aspects of the matter and hence even if it is assumed that such permission was granted by the Appellate Authority, the same cannot be maintained. Thus, the respondent-landlord has failed to satisfy the test laid down under clauses 13(1)(b) and 13(3)(ii) of the Rent Control Order, and the Authorities below have committed an error in holding that the respondent-landlord has satisfied the test prescribed therein. The impugned orders passed by the Authorities below are required to be quashed and set aside. 14. In the result, the petition is allowed. The impugned orders dated 15-11-2009 passed by the Rent Controller, Akola, in R.C. Case No.BRA 13(3)/AKL/1/2008-09, and dated 30-9-2010 passed by the Additional Collector, Akola, in Appeal bearing No.BRA-13(3)/AKOLA/1/2009-10, are hereby quashed and set aside. The application filed by the respondent-landlord before the Rent Controller stands dismissed. 15. 14. In the result, the petition is allowed. The impugned orders dated 15-11-2009 passed by the Rent Controller, Akola, in R.C. Case No.BRA 13(3)/AKL/1/2008-09, and dated 30-9-2010 passed by the Additional Collector, Akola, in Appeal bearing No.BRA-13(3)/AKOLA/1/2009-10, are hereby quashed and set aside. The application filed by the respondent-landlord before the Rent Controller stands dismissed. 15. Rule is made absolute in above terms. No order as to costs.