James Jacob, S/o. Chakkappan v. India Tech Ltd, Represented By Managing Director - R
2016-01-29
K.RAMAKRISHNAN, P.N.RAVINDRAN
body2016
DigiLaw.ai
JUDGMENT : P.N. Ravindran, J. The petitioners are the landlords in R.C.P.No.7 of 2015 on the file of the Rent Control Court, Aluva, a petition filed by them for an order evicting the respondent/tenant under sections 11(2)(b) of the Kerala Buildings (Lease and Rent Control) Act, 1965 (hereinafter referred to as 'the Act' for short). The petitioners had in the petition for eviction, which was instituted on 9.4.2015, inter alia averred that the petition schedule premises was let out to the tenant as per registered lease deed dated 10.8.2012, registered as document No.3890/2012 of SRO, Chengamanad for a period of ten years, that as per the said registered lease deed, the rent payable for the first 12 months is Rs.3,41,249/- and for the subsequent period of 12 months is Rs.3,61,724/-, that rent for the period thereafter is also fixed in the lease deed and that the tenant has committed default in paying the rent from October 2013 onwards. 2. As stated earlier, R.C.P. No.7 of 2015 was instituted on 9.4.2015. On that petition, on 10.4.2015, the Rent Control Court, Aluva directed notice to be issued to the respondent returnable by 16.6.2015. The petitioners did not take steps immediately. They took steps only on 17.6.2015 and thereupon notice was issued to the respondent on 18.6.2015 with the hearing date fixed as 28.7.2015. On that day, the respondent appeared and sought time to file objections and thereupon the rent control petition was adjourned to 22.9.2015. On 22.9.2015, the rent control petition was again adjourned to 22.11.2015. On that day, the rent control petition was not called. It was called on only 23.11.2015. On that day, it was submitted on behalf of the respondent/tenant that the rent control petition has become infructous for the reason that key of the building has already been surrendered. The Rent Control Court thereupon adjourned the petition to 27.11.2015 for verification. On 27.11.2015 on the short ground that key of the building has already been surrendered, the Rent Control Court closed R.C.P. No.7 of 2015 as infructuous by Ext. P5 order. The said order is under challenge in this original petition filed by the landlords under Article 227 of the Constitution of India. 3.
On 27.11.2015 on the short ground that key of the building has already been surrendered, the Rent Control Court closed R.C.P. No.7 of 2015 as infructuous by Ext. P5 order. The said order is under challenge in this original petition filed by the landlords under Article 227 of the Constitution of India. 3. It is contended that instead closing the petition for eviction as infructuous, the rent control court ought to have passed an order of eviction for the reason that the entrustment was by registered entrustment of lease. It is submitted that unless an order of eviction is passed and the said order is communicated to the Sub Registrar's Office concerned in terms of the stipulations contained in section 89 (5) of the Registration Act, 1908, execution of the lease deed would be shown as an encumbrance in encumbrance certificate for the reason that entrustment was by registered lease. On noticing the aforesaid circumstances, we admitted the original petition and directed notice to be served on the respondent by special messenger. After notice was served, the records were also called for. The records disclose that the tenant had on 30.10.2015 filed the original of Ext. P3 memo dated 29.11.2015 in the rent control court stating that the respondent/tenant is not in a position to continue the tenancy in the petition schedule property. It is stated therein that the keys of the said premises were offered to the landlords earlier by the respondent, but the same was not accepted by them and hence keys of the premises are produced before this court. It is also stated in the memo that the surrender of the keys is without prejudice to the rights of the tenant relating to the investment made by him in the petition schedule property and that but the respondent/tenant reserves the right to claim the amount invested by it in appropriate proceedings. The said memo was returned on the ground that the vakalath nama does not bear the advocate welfare stamp. The memo was represented on 18.11.2015 after curing the defect. By the impugned order passed on 27.11.2015 the Rent Control petition was closed as infructous. 4. When this original petition came up before us for consideration on 8.1.2016, we directed one among the petitioners and the Managing Director of the respondent company to be present on 14.1.2016.
The memo was represented on 18.11.2015 after curing the defect. By the impugned order passed on 27.11.2015 the Rent Control petition was closed as infructous. 4. When this original petition came up before us for consideration on 8.1.2016, we directed one among the petitioners and the Managing Director of the respondent company to be present on 14.1.2016. Accordingly petitioners 1 and 3 and the Managing Director of the respondent company were present. After considering the submissions made by learned counsel on both sides and after interacting with the parties who were present in person, we referred the parties to mediation. Mediation talks were accordingly held. The parties have after mediation, entered into an agreement dated 18.1.2016. Both the parties have subscribed their signatures to the said agreement. The tenant has in the said agreement admitted that it defaulted payment of the sum of Rs.62,57,828/- being the arrears of rent for the period from October 2013 till 7.4.2015. The agreement discloses that landlords have agreed to relinquish their entire claim for arrears of rent against the tenant, except the sum of Rs.10,00,000/- and have reserved liberty with them to move the appropriate court in accordance with law for claiming the aforesaid reserved and non -waived arrears of rent against the tenant, if they wish to do so. The agreement discloses that the tenant has agreed to give vacant possession of petition schedule property under section 11(2)(b) of the Act. He has also prayed for setting aside the order passed by the rent control court on 27.11.2015 dismissing R.C.P.No.7 of 2015 as infructuous. The parties have stipulated that after passing such an order, the Sub Registry, Chengamanadu may be communicated about the same. 5. We heard Sri. Thomas Geeverghese, learned counsel appearing for the petitioners and Sri. Saji Mathew, learned counsel appearing for the respondent. We have gone through the pleadings and the materials on record as also the memorandum of settlement arrived at between the parties. It is evident from the materials before us that the tenant had admitted that rent to the tune of Rs.62,57,828/- is due from him to the landlords by way of rent for the period commencing from October, 2013 and ending with March, 2015. He has also agreed that he is not in a position to pay the said sum and therefore, an order of eviction may be passed.
He has also agreed that he is not in a position to pay the said sum and therefore, an order of eviction may be passed. By the impugned order, the rent control court closed the rent control petition as infructuous on the ground that the tenant has surrendered the premises. Though under the provisions of the Transfer of Property Act, 1882, surrender of lease can be by mutual agreement, even without a document in writing as in the instant case as a registered lease deed has been entered into in respect of the petition schedule property, it will be shown as an encumbrance in the encumbrance certificate issued from the Sub Registry, Chengamanad. Rule 171 of the Registration Rules of Kerala framed and issued under section 69 (2) of the Indian Registration Act, 1908 clarifies the said position. Unless and until an instrument is executed, evidencing a surrender of the lease and it is registered, the lease deed executed in respect of the petition schedule property will be shown in the encumbrance certificate. For the purpose of executing a surrender of lease, the tenant or the landlord as the case may be will have to incur expenses besides the registration charges. In a case like the instant one, where the tenant has to pay the sum of Rs. 62,57,828/- from October 2013 till the date of filing of the rent control petition and the tenant is not in a position to pay the said sum and the landlords have agreed to waive the arrears except for the sum of Rs. 10,00,000/- and have reserved liberty with to sue them for realization of the sum of Rs. 10,00,000/-, it will be onerous and unjust if the parties are driven to necessity of having a deed of surrender executed and registered. Such being the situation, we are of the opinion that the proper course will be to set aside the impugned order, restore R.C.P.No.7 of 2015 to the file of the rent control court, Aluva and direct the rent control court, Aluva to pass an order of eviction in terms of the compromise entered into between the parties and communicate the same to the Sub Registry, Chengamanadu in terms of the stipulations contained in section 89(5) of the Registration Act, 1908. 6.
6. The Government of Kerala, have exercise of the power conferred on it under section 78 of the Registration Act, 1908 prescribed the table of fees payable in respect of various instruments including instruments evidencing surrender of lease deeds. In the instant case, if a surrender deed was to be executed, either of the parties will have to pay besides the stamp duty of Rs.250/- the registration charges paid at the time of registration of the lease deed. Payment of stamp duty or registration charges is not required, where the court passes a decree of order creating, declaring, transferring, allowing or extinguishing any right, title or interest in immovable property in favour of any person and a copy of such decree or order is sent to the Sub Registry Officer along with a memorandum for filing it in Book No.1. An order of eviction passed by the rent control court extinguishes the leasehold right/tenancy right in respect of the petition schedule property. There are instances where the tenants in possession of buildings under registered lease deeds are evicted by recourse to the provisions contained in the Act. No tenant against whom an order of eviction is passed will be willing to execute a deed of surrender even if the landlord is willing to meet the expenses including registration charges. The landlord will in that event be faced with a situation where the encumbrance certificate in respect of his property will show the execution of a registered lease deed as an encumbrance. The only way by which he can get rid of that encumbrance is by requesting the rent control court to communicate a copy of the order of eviction passed by it to the Sub Registry concerned in terms of the stipulations contained in sub-section (5) of section 89 of the Registration Act. If such a course of action is adopted, the rent control court will have to forward a copy of the order to the Sub Registry concerned to incorporate it in Book No.1. Any encumbrance certificate taken thereafter will contain a reference to the order of eviction passed by the rent control court thereby bringing it to the notice of the persons interested in the property that the lease stands terminated by an order of eviction passed by the rent control court.
Any encumbrance certificate taken thereafter will contain a reference to the order of eviction passed by the rent control court thereby bringing it to the notice of the persons interested in the property that the lease stands terminated by an order of eviction passed by the rent control court. Such being the situation, we are of opinion that the rent control courts in the State of Kerala should in cases where the entrustment of the building is under a registered instrument of lease, communicate a copy of the order of eviction passed by it in terms of section 89(5) of the Registration Act, 1908 to the registering authority having jurisdiction over the area where the petition schedule building is situate. In the instant case, the rent control court has merely stated that since the key of the building has been surrendered by the tenant, the rent control petition has become infructuous and consequently, the petition is closed. Having regard to the aforesaid facts and circumstances, we are of opinion hat the proper course will be to pass an order of eviction under section 11 (2)(b) of the Act simultaneous with the recording of the fact that the key of the building has been surrendered so as to enable the landlord to have recourse to section 89(1) of the Registration Act. We are therefore of the considered opinion that the impugned order cannot be sustained. We accordingly, allow the original petition, set aside the order passed by the Rent Control Court, Aluva on 27.11.2015 in R.C.P.No.7 of 2015 and remit R.C.P.No.7 of 2015 to the Rent Control Court, Aluva for fresh disposal in the light of the memorandum of agreement dated 18.1.2016. The rent control court shall, within one week from the date of receipt of a copy of this judgment as also the original of the memorandum of agreement which shall be forwarded by the Registry to that court, pass an order of eviction and thereafter communicate a copy thereof in accordance with the provisions contained in section 89 (5) of the Registration Act, 1908 to the Sub Registrar's Office, Changamanad. We also deem it appropriate to direct the Registry to communicate a copy of this judgment to the Rent Control Courts/Rent Control Appellate Authority in the State of Kerala for guidance.