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2018 DIGILAW 865 (RAJ)

Khadi Gram Udyog Bhawan v. Khushbu Mehta

2018-04-02

DINESH CHANDRA SOMANI, M.N.BHANDARI

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JUDGMENT : M.N. Bhandari, J. 1. By this writ petition, the constitutional validity of Section 6 of the Rajasthan Rent Control Act, 2001 (for short "the Act") has been challenged. 2. Learned counsel for petitioner submits that Section 6 of the Act of 2001 makes different categories for determination of rent. It is not based on intelligible differentia thus deserves to be struck down. A reference of Section 6(1)(a) of the Act, prior to amendment, has been given to show that for any premises let out prior to 1st January, 1950, enhancement @7.5% per annum has been allowed on the rent payable on 1st January, 1950. The amount of rent, so arrived at, shall be liable to increase @7.5% per annum till commencement of the Act after grouping in ten years. A reference of Section 6(1)(b) and (2) of the Act of 2001 has also been given. It again provides similar mechanism for enhancement of rent though it is for the premises let out after 1st January, 1950. As against the rate of 7.5% per annum, subsection (3) provides for enhancement of the rent at the rate of 5% per annum after commencement of the Act. 3. The argument of learned counsel for petitioner is that while Section 6(3) of the Act permits enhancement of rent at the rate of 5% per annum, Section 6(l)(a)(b) and (2) of the Pre-amended Act permits it at the rate of 7.5% per annum. No reason exists to provide different rates for increase of rent for the tenancy prior to the year 1950 or subsequent to the year 1950 till commencement of the Act and thereafter. 4. The State Government realised their mistake when difficulty was shown by the tenants for enhancement of rent at the rate of 7.5% per annum. The amendment was brought vide Notification dated 22nd February, 2006 to substitute 7.5% by 5% per annum. It is to make enhancement of rent on rational basis. After amendment of the Act, now enhancement of rent for any tenancy, whether prior to 1950 or subsequent to 1950 till commencement of the Act is to be at the rate of 5% per annum. 5. The reference of the object in bringing amendment of the Act of 2005 has been given. It was at the stage when problems were shown by the tenants. 5. The reference of the object in bringing amendment of the Act of 2005 has been given. It was at the stage when problems were shown by the tenants. A committee was constituted thereupon which took a decision to substitute 7.5% per annum by 5% per annum after holding ten meetings. The object to substitute 7.5% to that of 5% is sufficient to show disparity to enhance the rent at different rates. In view of the above, either pre-amended Section 6(1)(a)(b) and (2), which provides rate of 7.5% per annum, may be struck down or to substitute it by 5% per annum or, in the alternative, the Amending Act, 2005 be applied retrospectively so that enhancement of rent in all the cases may remain @5% per annum. 6. Learned counsel for petitioner made reference of judgment of the Supreme Court in the case of Shamarao V. Parulekar Vs. The District Magistrate, Thana, Bombay & Two Others, reported in S.C.R. (1952) 683. The judgment aforesaid supports the argument of the petitioner in regard to amendment of the Act in the year 2005. It has to be applied retrospectively and, accordingly, the court should take rate of 5% instead of 7.5% per annum, from the commencement of the Act. 7. It is stated that if enhancement of rent @ 5% is permitted after commencement of the Act, why same rate should not be permitted even for premises let out prior to the commencement of the Act of 2001, which may even be prior to the year 1950. The enhancement of rent at the rate of 7.5% per annum for the premises let out prior to commencement of the Act is harsh, thereby also, pre-amended provision, Section 6(1)(a)(b) and (2) deserves to be struck down. 8. We have considered submission made by learned counsel for petitioner and perused the record. 9. The constitutional validity of pre-amended Section 6(1)(a)(b) and (2) of the Act has been challenged. For ready reference, Section 6, prior to the amendment and after amendment, is quoted hereunder for ready reference: Pre-Amendment: "6. 8. We have considered submission made by learned counsel for petitioner and perused the record. 9. The constitutional validity of pre-amended Section 6(1)(a)(b) and (2) of the Act has been challenged. For ready reference, Section 6, prior to the amendment and after amendment, is quoted hereunder for ready reference: Pre-Amendment: "6. Revision of rent in respect of existing tenancies.- (1) Notwithstanding anything contained in any agreement, where the premises have been let out before the commencement of this Act, the rent thereof shall be liable to be revised according to the formula indicated below :- (a) where the premises have been let out prior to 1st January, 1950, it shall be deemed to have been let out on 1st January, 1950 and the rent payable at that time shall be liable to be increased at the rate of 7.5% per annum and the amount of increase of rent shall be merged in such rent alter ten years. The amount of rent so arrived at shall again be liable to he increased at the rate of 7.5% per annum in similar manner upto the year of commencement of this Act; (b) where the premises have been let out on or after 1st January, 1950, the rent payable at the time of commencement of the tenancy shall be liable to be increased at the rate of 7.5% per annum and the amount of increase of rent shall be merged in such rent after ten years. The amount of rent so arrived at shall again be liable to be increased at the rate of 7.5% per annum in similar manner upto the year of commencement of this Act. [x x x] (2) Notwithstanding anything contained in Sub-sec. (1), where the period of ten years for merger of increase of rent under Sub-sec. (1) is not completed upto the year of the commencement of this Act, the rent at the rate of 7.5% per annum shall be increased upto the Near of the commencement of this Act and amount of increase of rent shall be merged in rent. (3) The rent arrived at according to the formula given in Sub-secs. (1) is not completed upto the year of the commencement of this Act, the rent at the rate of 7.5% per annum shall be increased upto the Near of the commencement of this Act and amount of increase of rent shall be merged in rent. (3) The rent arrived at according to the formula given in Sub-secs. (1) and (2) shall, after completion of each year from the year of commencement of this Act, again be liable to be increased and paid at the rate of 7.5% per annum and the amount of increase of rent shall be merged in such rent after ten years. Such tent shall further be liable to he increased at similar rate and merged in similar manner till the tenancy subsists. (4) The rent revised as per formula given under Sub-sec. (1) or Sub-sec. (2) shall be payable, after the commencement of this Act, from the date agreed upon between the landlord and the tenant or where any petition is filed in a Rent Tribunal, from the date of filing of such petition." Post-Amendment: "6. Revision of rent in respect of existing tenancies.- (1) Notwithstanding anything contained in any agreement, where the premises have been let out before the commencement of this Act, the rent thereof shall be liable to be revised according to the formula indicated below (a) where the premises have been let out prior to 1st January, 1950, it shall be deemed to have been let out on 1st January, 1950 and the rent payable at that time shall be liable to be increased at the rate of [5%] per annum and the amount of increase of rent shall be merged in such rent alter ten years. The amount of rent so arrived at shall again be liable to he increased at the rate of 5% per annum in similar manner upto the year of commencement of this Act; (b) where the premises have been let out on or after 1st January, 1950, the rent payable at the time of commencement of the tenancy shall be liable to he increased at the rate of [5%] per annum and the amount of increase of rent shall be merged in such rent after ten years. The amount of rent so arrived at shall again be liable to be increased at the rate of [5%] per annum in similar manner upto the year of commencement of this Act. [x x x] (2) Notwithstanding anything contained in Sub-sec. (1), where the period of ten years for merger of increase of rent under Sub-sec. (1) is not completed upto the year of the commencement of this Act, the rent at the rate of 5% per annum shall be increased upto the Near of the commencement of this Act and amount of increase of rent shall be merged in rent. (3) The rent arrived at according to the formula given in Sub-secs. (1) and (2) shall, after completion of each year from the year of commencement of this Act, again be liable to be increased and paid at the rate of 5% per annum and the amount of increase of rent shall be merged in such rent after ten years. Such tent shall further be liable to he increased at similar rate and merged in similar manner till the tenancy subsists. (4) The rent revised as per formula given under Sub-sec. (1) or Sub-sec. (2) shall be payable, after the commencement of this Act, from the date agreed upon between the landlord and the tenant or where any petition is filed in a Rent Tribunal, from the date of filing of such petition." 10. Learned counsel for petitioner has raised two issues before us. The first is regarding constitutional validity of pre-amended Section 6(l)(a)(b) and (2) and others to treat amending Act of 2006 to be retrospective. 11. So far as second aspect for treating amendment of the Act of 2006 to be retrospective, is concerned, the Division Bench of this court has already answered it in the case of Smt. Santosh Devi Vs. Ravinder Singh & Anr., SB Civil Writ Petition No.13989/2009, along with connected matters, decided on 20th July, 2017 after an elaborate discussion of the issue. It has been held to be prospective. In the said case, the judgment of the Apex Court in the case of Shyamrao V. Parulekar & Ors. (supra) has been discussed. In the light of the aforesaid, we are unable to take a different view than expressed by the Division Bench of this court in the case of Smt. Santosh Devi (supra). In the said case, the judgment of the Apex Court in the case of Shyamrao V. Parulekar & Ors. (supra) has been discussed. In the light of the aforesaid, we are unable to take a different view than expressed by the Division Bench of this court in the case of Smt. Santosh Devi (supra). The Amending Act, 2006 has been applied prospectively and, accordingly, we are unable to take a different view in the matter, that too, when the petitioner's writ petition was also before the Division Bench of this court in the case of Smt. Santosh Devi (supra). 12. The another issue is regarding the constitutional validity of Section 6(1)(a)(b) and (2), pre-amendment. The challenge is made mainly on the ground of different rate for increase of the rent. Prior to amendment, Section 6(1)(a)(b) and (2) were providing rate of 7.5% per annum, whereas, sub-section (3) provides increase at the rate of 5% per annum. 13. The question raised before us is as to why two rates have been provided i.e. one prior to commencement and other from the date of commencement of the Act of 2001. It is said to be harsh on the tenancy prior to the commencement where enhancement of rate of rent has been allowed at the rate of 7.5% per annum. To appreciate the argument, we need to refer the provisions of the Act prior to the Act of 2001. The aforesaid is necessary to find out as to what was the provision for enhancement of rent prior to the Act of 2001. 14. The tenancy in the State of Rajasthan was governed by the Rajasthan Premises (Control of Rent and Eviction) Act, 1950. In the said Act, there was no provision for enhancement of rent though a provision for determination of standard rent was existing. The effect of the aforesaid was to have stagnated rent for the tenancy till commencement of the Act of 2001. 15. A tenant taken premises in the year in the year 1930 or 1940 or so even in 1960 was paying the same rent unless standard rent was fixed by the court. The aforesaid shows stagnated rent for years together without enhancement. The legislatures, in their wisdom, thought it proper to make distinction between the tenancy prior to the Act and subsequent. The aforesaid shows stagnated rent for years together without enhancement. The legislatures, in their wisdom, thought it proper to make distinction between the tenancy prior to the Act and subsequent. To have reasonable basis, the rate of 7.5% per annum was provided for increase of rent till commencement of the Act of 2001. After the aforesaid, similar rates were provided for all the tenancies on commencement of the Act of 2001 i.e. to be governed by Section 6(3) of the Act. 16. We find rational between two different rates provided by the legislature for increase of rent for those tenancies where premises were let out prior to the commencement of the Act. It may even be prior to the year 1950. For those premises let out prior to 1950, the crucial date for determination of rent for increase was taken on the rent existing on 1st January, 1950 and any premises let out after 1st January, 1950, the rent is taken on the rate so provided mutually by a landlord and a tenant. The higher rate was taken for the reason that rent remain stagnated till commencement of the Act of 2001, hence, to be determined by reasonable increase, it is based on intelligible differentia. 17. It is, however, true that in the year 2006, the amendment of the Act was brought to substitute 7.5% by 5% per annum under Section 6(1)(a)(b) and (2). The bare perusal of the object produced before us does not show basis other than to show certain problems. What were those problems, have not been specified. We want to elaborate the facts of those premises let out prior to the year 1950 or even subsequently till commencement of the Act. The premises were let out on a meager rent and continued for years together without any increase in absence of a provision. To make things reasonable and to have balance between a tenant and a landlord, the legislatures, in their wisdom, provided rate of 7.5% per annum for increase of rent with merger in 10 years. 18. In view of the above, we do not find Section 6(1)(a)(b) and (2) of the pre-amended Act to be unconstitutional. To make things reasonable and to have balance between a tenant and a landlord, the legislatures, in their wisdom, provided rate of 7.5% per annum for increase of rent with merger in 10 years. 18. In view of the above, we do not find Section 6(1)(a)(b) and (2) of the pre-amended Act to be unconstitutional. In the instant case, the petitioner lost battle upto the Division Bench of this court in the case of Smt. Santosh Devi (supra) in view of the fact that, initially, an application for enhancement filed by the landlord was allowed. The determination of rent was made with increase @7.5% per annum. On an appeal before the Rent Appellate Tribunal, it was calculated on 5% per annum. The landlord then approached the High Court for challenge to the order passed by the Rent Appellant Tribunal and remained successful before the Division Bench of this court in the case of Smt. Santosh Devi (supra) where enhancement was allowed at the rate of 7.5% per annum. It is after losing battle upto the Division Bench of this court in the case of Smt. Santosh Devi (supra) that present writ petition has been filed by the petitioner to challenge the constitutional validity of Section 6(1)(a)(b) and (2) of Pre-amended Act. 19. For the reasons given above, we do not find any ground to allow the prayer made in the present writ petition. Accordingly, writ petition fails and is hereby dismissed.