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Rajasthan High Court · body

2011 DIGILAW 315 (RAJ)

Naveen Sharma v. Ram Dayal

2011-02-10

M.N.BHANDARI

body2011
Hon'ble BHANDARI, J.—By this writ petition, a challenge has been made to the order dated 17.7.2007 whereby the Appellate Rent Tribunal passed conditional stay on appeal against the order of eviction by Rent Tribunal dated 1.5.2007. A challenge has been made in reference to the provisions of Section 19 and 20 of the Rajasthan Rent Control Act, 2001, (Herein after referred to as `The Act' of 2001). 2. It is submitted that the Appellate Rent Tribunal, has no jurisdiction to issue direction for payment of mesne profit. Such direction can be issued only in execution. Specific reference to Section 20 of the Act has been given in that regard. The rent amount of Rs.1,100/- per month has been enhanced to Rs. 3,400/- per month as mesne profit. Accordingly prayer is made to set-aside the order. 3. On the other hand, learned counsel for the respondents supports the order and submits that the payment of mesne profit is nothing but out come of Section 20(3) of the Act. On expiry of period of three months from the date of issuance of recovery certificate, tenant became liable for payment of mesne profit at the rate given under Section 20(3) of the Act. This however remains subject to final order of Appellate Rent Tribunal. 4. In view of the aforesaid, the direction of payment of mesne profit can be ordered by the Appellate Rent Tribunal. Learned counsel for the respondent has made a reference to the case of Atma Ram Properties (P) Ltd. vs. Federal Motors (P) Ltd. (2005) 1 SCC 705 wherein mesne profit was allowed at the market rate. 5. I have considered the submissions made by the learned counsel for the parties and perused the record. 6. Since, the main question involved in the matter is in reference to the order passed by Appellate Rent Tribunal for payment of mesne profit while passing the interim order. The question is as to whether Appellate Rent Tribunal has jurisdiction to pass order for payment of mesne profit. For this purpose a reference to Section 19, 20 and 21 of the Act of 2001 would be relevant thus quoted here under:- 19. Appellate Rent Tribunal, Appeals and limitation thereof.- (1) The State Government shall constitute such number of Appellate Rent Tribunals and at such places as may be deemed necessary by it, by notification in the Official Gazette. For this purpose a reference to Section 19, 20 and 21 of the Act of 2001 would be relevant thus quoted here under:- 19. Appellate Rent Tribunal, Appeals and limitation thereof.- (1) The State Government shall constitute such number of Appellate Rent Tribunals and at such places as may be deemed necessary by it, by notification in the Official Gazette. (2) Where two or more Appellate Rent Tribunals are constituted for any area, the State Government may, by general or special order, regulate the distribution of business among them. (3) An Appellate Rent Tribunal shall consist of one person only (hereinafter referred to as the Presiding Officer of the Appellate Rent Tribunal) to be appointed by the High Court. (4) No person shall be eligible to be appointed as Presiding Officer of the Appellate Rent Tribunal unless he is a member of the Rajasthan Higher Judicial Service having not less than seven years experience as such. (5) Notwithstanding anything contained in sub-section (3), the High Court may authorise the Presiding Officer of one Appellate Rent Tribunal to discharge the functions of the Presiding Officer of the another Appellate Rent Tribunal also. (6) From every final order passed by the Rent Tribunal, an appeal shall lie to the Appellate Rent Tribunal, within the local limits of whose jurisdiction the premises is situated and such an appeal shall be filed within a period of thirty days from the date of final order alongwith copy of such final order. (7) The Appellate Rent Tribunal, upon filing an appeal under sub-section (6), shall serve notice, accompanied by copy of appeal, on the respondent on the date fixed by the Rent Tribunal under Section 17 for the appearance of the parties before it. If the respondent fails to appear on the date so fixed before the Appellate Rent Tribunal, he may be proceeded against ex-parte. in case the final order under Section 17 was passed in ex-parte proceedings against any party, the Appellate Rent Tribunal shall issue notice, accompanied by copy of appeal, fixing a date not later than thirty days, requiring the respondent to appear before it on the date so fixed and service of such a notice shall be effected through process server of the Tribunal or civil court as well as by the registered post, acknowledgement due and notice duly served by any of these methods shall be treated as sufficient service. Where however, the Appellate Rent Tribunal otherwise consider it necessary so to do in the interest of justice in the facts of the case, it may issue notice of appeal to the respondent in the manner indicated above. (8) The Appellate Rent Tribunal shall, thereafter, fix a date of hearing which shall not be later than forty five days from the date of service of notice of appeal on the respondent and the appeal shall be disposed of within a period of one hundred and eighty days from the date of service of notice of appeal on the respondent. (9) Where the Appellate Rent Tribunal considers it necessary in the interest of arriving at a just and proper decision, it may allow filing of additional affidavit or documents at any stage of the proceedings in appeal. (10) The Appellate Rent Tribunal may in its discretion pass such interlocutory order, during the pendency of the appeal, as it may deem fit. (11) (a) While deciding the appeal, the Appellate Rent Tribunal may after recording reasons therefor,- (i) confirm, vary, set aside, reverse or modify the order passed, by a Rent Tribunal; or (ii) if necessary in the interest of justice, remand the case to the Rent Tribunal alongwith such direction as it may deem fit. (b) The Appellate Rent Tribunal shall issue appropriate recovery certificate according to the decision rendered by it. (c) The decision of the Appellate Rent Tribunal shall be final and no further appeal or revision shall be against its order. (12) On the application of any of the parties and after notice to the parties and after hearing such of them as have desired to be heard, or of its own motion without such notice, the Appellate Rent Tribunal may at any stage transfer any case from one Rent Tribunal to any other Rent Tribunal for disposal. (13) Where any case has been transferred under sub-section (12), the Rent Tribunal which has thereafter to try or dispose of such case may, subject to any special direction in the order of transfer, proceed from the stage at which it was transferred. Explanation.-The expression "final order" referred to in sub-section (6) shall mean an order by which any proceedings pending before the Rent Tribunal is finally disposed of. 20. Explanation.-The expression "final order" referred to in sub-section (6) shall mean an order by which any proceedings pending before the Rent Tribunal is finally disposed of. 20. Execution of the orders.-(1) The Rent Tribunal shall, on application of any party, execute in the manner prescribed, a final order or any other order passed under this Act by adopting any one or more of the following modes, namely:- (a) attachment and sale of the movable or immovable property of the opposite party; (b) arrest and detention of the opposite party; (c) attachment of any one or more bank accounts of the opposite party and satisfaction of the amount of order to be paid from such account; (d) attachment of salary and allowance of a Government servant or employee of any nationalised bank, local authority, corporation, Government company; (e) appointing any advocate as Commissioner on such remuneration as may be fixed or deputing any officer of the Tribunal or local administration or local body for execution of the order. (f) delivery of possession of the applicant. (2) The Tribunal may, in order to execute the final order or any other passed under this Act require thee help from the local administration or local body or the police. (3) If the tenant does not vacate the premises within three months of the date of issue of certificate for recovery of the possession, he shall be liable, from the date of issue of certificate, for recovery of possession to pay mesne profits at the rate of 2 times the rent in case of premises let out for residential purposes, at the rate of 3 times the rent, in case of premises let out for commercial purposes and at the rate of 3 times the rent in case certificate for recovery of immediate possession has been issued under Section 16. (4) The Rent Tribunal shall conduct the execution proceedings, in relation to a final order or any other order passed under this Act in summary manner and dispose of the application for execution made under this section within forty five days from the date of service of notice on opposite party. (4) The Rent Tribunal shall conduct the execution proceedings, in relation to a final order or any other order passed under this Act in summary manner and dispose of the application for execution made under this section within forty five days from the date of service of notice on opposite party. Explanation.- Filing of an appeal or other proceeding against the order of issue of certificate for recovery of possession or immediate possession will not save the tenant from his liability to pay mesne profits, at the rates specified under sub-section (3), unless specifically ordered otherwise by the Appellate Rent Tribunal or the Court before which such an order is under challenge and if the order of issue of recovery certificate is finally maintained, the tenant shall be liable to pay mesne profits at the rates specified under sub-section (3) from the date on which the recovery certificate was initially issued. 21. Procedure and powers of the Rent Tribunal and the Appellate Rent Tribunal.(1) In every case before the Rent Tribunal and the Appellate Rent Tribunal the evidence of a witness shall be given by affidavit. However, the Rent Tribunal or the Appellate Rent Tribunal, where it appears to it that it is necessary in the interest of justice to call a witness for examination or cross-examination and such witness can be produced, may order attendance for examination or cross-examination of such a witness. (2) The documents filed before the Rent Tribunal by the petitioner shall be distinctly marked by him as Ex. 1, Ex. 2 and so on in the red ink and the documents filed by the respondent shall be similarly distinctly marked by him as Ex. A 1, Ex. -A 2 and so on in red ink and in the affidavits the documents shall be referred by these exhibit marks and signatures or other parts of the documents referred to in the affidavits shall be distinctly marked by the party filing the document as A to B or C to D and so on in red ink. -A 2 and so on in red ink and in the affidavits the documents shall be referred by these exhibit marks and signatures or other parts of the documents referred to in the affidavits shall be distinctly marked by the party filing the document as A to B or C to D and so on in red ink. (3) The Rent Tribunal and the Appellate Rent Tribunal shall not be bound by the procedure laid down by the Code of Civil Procedure, 1908 (Central Act No. 5 of 1908), but shall be guided by the principal of natural justice and subject to other provisions of this Act or the Rules made thereunder and shall have powers to regulate their own procedure, and for the purpose of discharging their functions under this Act they shall have, the same powers as are vested in a civil court under the Code of Civil Procedure, 1908 (Central Act No. 5 of 1908) while trying a suit or an appeal in respect of following matters, namely:- (a) summoning and enforcing the attendance of any person and examining him on oath; (b) requiring the discovery and production of documents; (c) reviewing its decision; (d) issuing commissions for the examination of witnesses or documents; (e) dismissing petition for default or deciding it ex-parte; (f) setting aside any order of dismissal of any petition for default or any order passed by it ex-parte; (g) bringing legal representatives on record; and (h) any other, matter as may be prescribed. (4) Rent Tribunal shall not grant any adjournment without written application and recording the reasons therefor in writing. (5) Any proceeding before the Rent Tribunal or Appellate Rent Tribunal shall deemed be to be a judicial proceedings within the meaning of sections 193 and 228 and for the purpose of section 196 of the Indian Penal Code, 1860 (Central No. 45 of 1860) and the Rent Tribunal or the Appellate Rent Tribunal shall be deemed to be a civil Court for the purposes of section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973 (Central Act No. 2 of 1974). 7. 7. A perusal of sub-section (3) of section 20 shows that if a tenant does not vacate the premises within three months from the date of issuance of certificate of recovery, he shall be liable for payment of mesne profit at the rate of two times if the premises is residential and three times if the premises is commercial. Such mesne profits becomes payable from the date of issuance of recovery certificate. Explanation to Sub-section (4) of Section 20 provides about powers of Appellate Rent Tribunal. By virtue of explanation, it comes out that Appellate Rent Tribunal is having authority to pass order otherwise, in any case, it should not pass an order to pay mesne profit over and above mentioned under Sub-section (3) of Section 20 of the Act, 2001 because, at last, if, certificate of recovery issued by the Rent Tribunal is maintained by the Appellate Rent Tribunal, mesne profit remains at the rate provided under Sub-section (3) of Section 20 of the Act. The explanation clarifies the above. 8. Same confusion exists in the mind of petitioner as provisions of Section 20(3) exist in the heading of execution. In my opinion, confusion is unnecessary as Section 20(3) of the Act takes effect automatically with expiry of three months from the date of issuance of certificate of recovery, if premises is not vacated. 9. In view of the explanation to Section 20(4) of the Act, the Appellate Rent Tribunal is having powers for issuance of direction for payment of mesne profit while granting interim order. However, such order can be passed when a certificate of recovery has been issued and thereupon premises is not vacated within three months. 10. Now comes the question as what can be the mesne profit. Can Appellate Rent Tribunal pass order for payment of mesne profit above the rates provided under Section 20(3) of the Act. In this regard reference of the Judgment in case of Atma Ram Properties (P) Ltd. vs. Federal Motors (P) Ltd. (Supra), is generally given; though provisions considered there in were quite different then applicable in the State of Rajasthan. Para 6, 7, 8, 11 and 19 of the aforesaid Judgment are quoted hereunder:- "6. The order of eviction passed by Rent Controller is appealable to the Rent Control Tribunal under Section 38 of the Act. Para 6, 7, 8, 11 and 19 of the aforesaid Judgment are quoted hereunder:- "6. The order of eviction passed by Rent Controller is appealable to the Rent Control Tribunal under Section 38 of the Act. There is no specific provision in the Act conferring power on the Tribunal to grant stay on the execution of the order of eviction passed by the Controller, but sub-Section (3) of Section 38 confers the Tribunal with all the powers vested in a Court under the Code of Civil Procedure, 1908 while hearing an appeal. The provision empowers the Tribunal to pass an order of stay by reference to Rule 5 of Order 41 of the Code of Civil Procedure 1908 (hereinafter `the Code', for short). This position was not disputed by the learned senior counsel appearing for either of the parties. 7. Sub-Rule (1) and (3) of Rule 5 of Order 41 of the Code read as under:- "R. 5 Stay by Appellate Court (1) An appeal shall not operate as a stay of proceedings under a decree or order appealed from except so far as the Appellate Court may order, nor shall execution of a decree be stayed by reason only of an appeal having been preferred from the decree; but the Appellate Court may for sufficient cause order stay of execution of such decree. xxx xxx xxx xxx (3) No order for stay of execution shall be made under sub-rule (1) or sub-rule (2) unless the court making it is satisfied- (a) that substantial loss may result to the party applying for stay of execution unless the order is made; (b) that the application has been made without unreasonable delay; and (c) that security has been given by the applicant for the due performance of such decree or order as may ultimately be binding upon him. xxx xxx xxx xxx" 8. It is well settled that mere preferring of an appeal does not operate as stay on the decree or order appealed against nor on the proceedings in the court below. A prayer for the grant of stay of proceedings or on the execution of decree or order appealed against has to be specifically made to the appellate court and the appellate Court has discretion to grant an order of stay or to refuse the same. A prayer for the grant of stay of proceedings or on the execution of decree or order appealed against has to be specifically made to the appellate court and the appellate Court has discretion to grant an order of stay or to refuse the same. The only guiding factor, indicated in the Rule 5 aforesaid, is the existence of sufficient cause in favour of the appellant on the availability of which the appellate Court would be inclined to pass an order of stay. Experience shows that the principal consideration which prevails with the appellate Court is that in spite of the appeal having been entertained for hearing by the appellate Court, the appellant may not be deprived of the fruits of his success in the event of the appeal being allowed. This consideration is pitted and weighed against the other paramount consideration: why should a party having succeeded from the Court below be deprived of the fruits of the decree or order in his hands merely because the defeated party has chosen to invoke the jurisdiction of a superior forum. Still the question which the Court. dealing with a prayer for the grant of stay asks to itself is: Why the status quo prevailing on the date of the decree and/or the date of making of the application for stay be not allowed to continue by granting stay, and not the question why the stay should be granted 11. Under the general law, and in cases where the tenancy is governed only by the provisions of Transfer of Property Act, 1882, once the tenancy comes to an end by determination of lease under Section 111 of the Transfer of Property Act, the right of the tenant to continue in possession of the premises comes to an end and for any period thereafter, for which he continues to occupy the premises, he becomes liable to pay damages for use and occupation at the rate at which the landlord could have let out the premises on being vacated by the tenant. In the case of Chander Kali Bai & Ors. (supra) the tenancy premises were situated in the State of Madhya Pradesh and the provisions of the M.P. Accommodation Control Act, 1961 applied. The suit for eviction was filed on 8th March 1973 after serving a notice on the tenant terminating the contractual tenancy w.e.f. 31st December, 1972. In the case of Chander Kali Bai & Ors. (supra) the tenancy premises were situated in the State of Madhya Pradesh and the provisions of the M.P. Accommodation Control Act, 1961 applied. The suit for eviction was filed on 8th March 1973 after serving a notice on the tenant terminating the contractual tenancy w.e.f. 31st December, 1972. The suit came to be dismissed by the trial Court but decreed in first appeal decided on 11th August, 1975. One of the submissions made in this Court on behalf of the tenant-appellant was that no damages from the date of termination of the contractual tenancy could be awarded; the damages could be awarded only from the date when an eviction decree was passed. This Court took into consideration the definition of tenant as contained in Section 2(i) of the M.P. Act which included "any person continuing in possession after the termination of his tenancy" but did not include "any person against whom any order or decree for eviction has been made." The court, persuaded by the said definition, held that a person continuing in possession of the accommodation even after the termination of his contractual tenancy is a tenant within the meaning of the M.P. Act and on such termination his possession does not become wrongful until and unless a decree for eviction is passed. However, the Court specifically ruled that the tenant continuing in possession even after the passing of the decree became a wrongful occupant of the accommodation. In conclusion the Court held that the tenant was not liable to pay any damages or mesne profits for the period commencing from 1st January 1973 and ending on 10th August, 1975 but he remained liable to pay damages or mesne profits from 11th August 1975 until the delivery of the vacant possession of the accommodation. During the course of its decision this Court referred to a decision of Madhya Pradesh High Court in Kikabhai Abdul Hussain vs. Kamlakar, 1974 MPLJ 475, wherein the High Court had held that if a person continues to be in occupation after the termination of the contractual tenancy then on the passing of the decree for eviction he becomes a wrongful occupant of the accommodation since the date of termination. This Court opined that what was held by the Madhya Pradesh High Court seemed to be a theory akin to the theory of "relation back" on the reasoning that on the passing of a decree for possession, the tenant's possession would become in unlawful not from the date of the decree but from the date of the termination of the contractual tenancy itself. It is noteworthy that this Court has not disapproved the decision of the Madhya Pradesh High Court in Kikabhai Abdul Hussain's case but distinguished it by Ibserving that the law laid down in Kikabhai Abdul Hussain's case was not applicable to the case before it in view of the definition of `tenant' as contained in the M.P. Act and the provisions which came up for consideration of the High Court in Kikabhai Abdul Hussain's case were different. 19. To sum up, our conclusions are:- (1) While passing an order of stay under Rule 5 of Order 41 of the Code of Civil Procedure, 1908, the appellate Court does have jurisdiction to put the applicant on such reasonable terms as would in its opinion reasonably compensate the decree-holder for loss occasioned by delay in execution of decree by the grant of stay order, in the event of the appeal being dismissed and in so far as those proceedings are concerned. Such terms, needless to say, shall be reasonable; (2) in case of premises governed by the provisions of the Delhi Rent Control Act, 1958, in view of the definition of tenant contained in clause (1) of Section 2 of the Act, the tenancy does not stand terminated merely by its termination under the general law; it terminates with the passing of the decree for eviction. With effect from that date, the tenant is liable to pay mesne profits or compensation for use and occupation of the premises at the same rate at which the landlord would have been able to let out the premises and earn rent if the tenant would have vacated the premises. The landlord is not bound by the contractual rate of rent effective for the period preceding the date of the decree; (3) the doctrine of merger does not have the effect of postponing the date of termination of tenancy merely because the decree of eviction stands merged in the decree passed by the superior forum at a latter date." 11. The landlord is not bound by the contractual rate of rent effective for the period preceding the date of the decree; (3) the doctrine of merger does not have the effect of postponing the date of termination of tenancy merely because the decree of eviction stands merged in the decree passed by the superior forum at a latter date." 11. Perusal of paras show that Section 38 of Delhi Rent Control Act of 1958 confers the Tribunal, with all the powers vested in a Court under the Code of Civil Procedure, thus, Order 41 Rule 5 CPC becomes applicable. It is in reference to the aforesaid statutory provisions that judgment has been given. Since Act of 2001 does not provide application of the provisions of Order 41 Rule 5 of CPC, the Appellate Rent Tribunal can provide rate of mesne profit as given under Section 20(3) of the Act or less then it but not above, because if the order of Rent Tribunal is maintained finally, meanse profit remains payable at the rate provided under Section 20(3) of the Act. At times the market value is taken into consideration by the Appellate Rent Tribunal for determination of mesne profit. In my opinion, such liberty does not exist with Appellate Rent Tribunal for grant of mesne profit. It cannot be at a rate more than provided under sub-section (3) of Section 20 of the Act of 2001. It is well settled law that no judgment can nullify statutory provisions unless struck down. Thus Atma Ram's judgment (supra), cannot be applied in rime of the provision of Act of 2001. 12. In the light of the aforesaid, fixing the mesne profit at Rs. 3,400/- can not be said to be proper taking note of the rent being Rs. 1,100/- and the property in dispute being commercial. Accordingly, mesne profits are ordered to be maintained three times i.e. Rs. 3,300/-. With aforesaid modification, the impugned order is made absolute. 13. Accordingly, the writ petition stands disposed of. Since main petition has been disposed of, stay application also stands disposed of. Cost is made easy.