JUDGMENT
Mahmood Ali Khan, J.
1. This revision petition challenges the order of an
Additional District Judge dated 6.11.1996 by which he
has dismissed an appeal filed by the petitioner under
Section 9 of the Public Premises (Eviction of
Unauthorised Occupants) Act, 1971 (in short the Act) and
has affirmed the order of the Estate Officer.
2. Briefly the facts are that petitioner Northern
Enterprises Corporation Pvt. Ltd. took on license basis
from respondent No. 1 NDMC covered area of 1523 sq.ft.
on 8th Floor of a multi storeyed building called Mayur
Bhawan, near Connaught Place, New Delhi for a period 2
years w.e.f. 15.1.1981 at the rate of license fee of
Rs. 6.60 per sq.ft. On the expiry of the license period
it was renewed for further period of 5 years w.e.f.
15.1.1983 on the increase rate of license fee of
Rs. 10.75 per sq.ft. During the period of said license
the name of the petitioner company was changed from
Northern Enterprises Corporation Pvt. Ltd. to Northern
Enterprises Pvt. Ltd. and a fresh certificate of
incorporation was issued and the respondent NDMC was
informed of this change. In order to meet the
requirement of Government Financial Institutions the
name of the petitioner company was further changed to
Northern Enterprises Ltd. and a new certificate of
incorporation was issued on 24.7.1985 and by letter
dated 20.8.1985 the respondent was duly informed of this
change in the name. But respondent No. 1 took a stand
that the terms of the license agreed to with the
Northern Enterprises Corporation Pvt. Ltd. would not be
applicable to the new company though offered to enter
into a fresh agreement with Northern Enterprises Ltd.
provided the license fee, was enhanced to Rs. 17.84 per
sq.ft. from the date of the change in the name i.e.
from 24.7.1985. The petitioner protested and did not
agree. Respondent No. 1 thereupon filed an application
under Section 7 of the Act before the Estate Officer for
ejectment of the petitioner on the allegation that it
was in unauthorised occupation of the premises.
Respondent also claimed the enhanced license fee/damages
besides interest @15% per annum on the amount of
damages. In reply to the show cause notice the
petitioner challenged the jurisdiction of the Estate
Officer to initiate proceedings under Section 7 of the
Act as the petitioner had not been in unauthorised
occupation of the premises and was not liable to pay
damages or interest as claimed by respondent No. 1 NDMC.
The Estate Officer accepted the contention of the
petitioner that the change in the name has not brought
about change in the identity of the petitioner license
and that the license fee was not payable at enhanced
rate. He further held that the license fee at agreed
rate was payable up to 14.1.1988. He directed the
petitioner to pay arrears of damages @17.84 per sq.ft.
from 15.11.1988 to the date of the vacation of the
premises with interest @15% p.a. on the arrears.
3. The petitioner challenged this order before the
Additional District Judge in an appeal. Learned
Additional District Judge dismissed the appeal and
affirmed the order of the Estate Officer. The
petitioner is aggrieved and has filed this revision
petition impugning the order of the learned Additional
District Judge.
4. Counsel for petitioner has submitted that the
petitioner has already vacated the premises on
05.08.1989 and has also paid the license fee. He stated
that the petitioner was challenging the order of the
learned Additional District Judge by which he had
affirmed the order of the Estate Officer awarding
interest @15% on the arrears. Referring to provision of
Sub-section (2A) of Section 7 of the Act, it is argued
that it is clearly stipulated that the interest on the
arrears of license fee/damages etc. may be awarded by
the Estate Officer at a rate “prescribed” and the
Additional District Judge has failed to appreciate that
no rate of interest has been prescribed yet under the
rules framed there under. It was also argued that the
rules framed in accordance with Section 18 of the said
Act did not prescribe any rate of interest, therefore,
the Estate Officer had no power or jurisdiction to award
any interest whatsoever and direct the petitioner to pay
it. He urged that the Additional District Judge had
acted without jurisdiction and with material
irregularity in exercise of his jurisdiction, therefore,
the order is liable to be set aside.
5. On the other hand, counsel for respondent No. 1
NDMC contended that the Estate Officer was empowered by
Sub-section (2) and (2A) of Section 7 of the Act to
award interest on the arrears of rent/damages etc. He
justified the order and prayed that the petition was
liable to be dismissed.
6. This revision petition is filed to assail the
order of the Additional District Judge which he passed
in an appeal filed against the order of the Estate
Officer under Section 9 of the Act. This order cannot
be challenged in a revision petition filed under Section
115 of the CPC. The Additional District Judge deciding
the appeal was acting as a tribunal and not as a court
subordinate to the High Court, therefore, Section 115 of
the CPC is not available to the petitioner for assailing
this order.
7. However, this petition was filed on 10.2.1997 and
it was admitted for hearing as a revision petition by
this court on 26.10.1999, therefore, in my view it will
be travesty of justice if the petition is dismissed on
technicalities at this late stage. The respondent has
not questioned the maintainability of this petition
under Section 115 of the CPC. This Court even otherwise
has ample power to convert this petition into a civil
main petition and consider it as such. Therefore
without passing a formal order for registering this
petition as CM(Main) petition, since it would further
delay in the disposal to an already over delayed case.
I treat this petition under Article 227 of the
Constitution of India in the peculiar facts and
circumstances of the case. But I make it clear that it
shall not be treated as a precedent in other cases.
8. The dispute raised is also otherwise limited to
the question of awarding of interest on the amount of
arrears of license fee/damages payable by the petitioner
to the respondent.
9. Only question raised in this petition is whether
the Estate Officer has power and jurisdiction to award
interest on the arrears of rent/damages under Section
7(2A) of the Act before the rate of simple interest is
prescribed?
10. The Estate Officer is given power by Sub-section
(2) read with Sub-section (2A) of Section 7 of the Act
to award simple interest on the arrears of rent or
damages payable by the unauthorised occupant under
Sub-section (2). Being relevant, Sub-sections (2) and
(2A) are being extracted below:-
(2) Where any person is, or has at any
time been, in unauthorised occupation of
any public premises, the estate officer
may, having regard to such principles of
assessment of damages as may be
prescribed, assess the damages on
account of the use and occupation of
such premises and may, by order, require
that person to pay the damages within
such time and in such Installments as may
be specified in the order.
(2A) “While making an order under
Sub-section (1) or Sub-section (2), the
estate officer may direct that the
arrears of rent or, as the case may be,
damages shall be payable together with
simple interest at such rate as may be
prescribed, not being a rate exceeding
the current rate of interest within the
meaning of the Interest Act, 1978.”
11. The maximum rate of interest awardable is the
‘current rate of interest’ as defined in the Interest
Act. The Interest Act defines the expression “current
rate of interest” by clause (b) of Section 2, which is
as follows:-
“Current rate of interest” means
the highest of the maximum rates at which
interest may be paid on different classes
of deposits (other than those maintained
in savings or those maintained by
charitable or religious institutions) by
different classes of scheduled banks in
accordance with the directions given or
issued to banking companies generally by
the Reserve Bank of India under the
Banking Regulation Act, 1949 (10 of
1949).
Explanation.–In this clause,
“scheduled bank” means a bank, not being
a co-operative bank, transacting any
business authorised by the Banking
Regulation Act, 1949 (10 of 1949)”.
12. Short argument of counsel for petitioner is that
the rate of interest has not been “prescribed” in the
Rules or otherwise so far, therefore, the Estate Officer
has no power and jurisdiction to award interest on the
amount of the arrears of rent and the damages which is
payable under Sub-section (2) of Section 7 of the Act.
This argument has no force. Reading of Sub-section (2A)
of Section 7 of the Act and the expression “Current rate of
interest” as defined in clause (b) of Section 2 of the
Interest Act conjointly, it is menifest that the Estate
Officer has discretion to award simple interest on the
arrears of rent/damages recoverable from an unauthorised
occupant. But the rate of interest is not to exceed the
rate which scheduled banks pay on bank deposits (other
than certain specified classes of deposit) as per
direction of Reserve Bank of India. The jurisdiction of
the Estate Officer is not ousted merely because the rate
of simple interest has not been ‘prescribed’. Even if
it is prescribed, the maximum rate of interest can not
exceed the bank rate as envisaged in clause (b) of
Section 2 of the Interest Act. In my view the absence
to specify the rate of interest by Rules or appropriate
authority cannot nullify the legislative intent. The
statutory provision cannot be held to be a dead letter
till such time the interest rate is prescribed in the
absence of clear words in the Act which may show such an
intention on the part of the legislature. I am unable
to find such intention from the provisions of the Act.
Sub-section (2A) of Section 7 of the Act does not show
that on account of inaction on the part of appropriate
authority the legislative intent would remain in
abeyance. In the absence of the prescribed interest
rate the Estate Officer may award simple interest at the
rate which is payable on bank deposits at relevant time
and is considered fair and reasonable by him in the
facts and circumstances of the case with the only
stipulation that such interest rate shall in no case
exceed the current rate of interest within the meaning
of Interest Act.
13. According to the petitioner the rate of simple
interest on ordinary bank deposits on the relevant date
was 10% p.a. Respondent No. 1 has not been able to show
that on the deposits mentioned in clause (b) of Section
2 of the Interest Act the scheduled banks in accordance
with the guidelines of the RBI were paying simple
interest at the rate higher than 10% p.a. It seems to
be a reasonable and fair rate of simple interest. The
order of the Estate Officer fixing interest at the rate
of 15% per annum is manifestly unreasonable and not in
accordance with law.
14. For the reasons stated above, there appears
patent error in law in the order and exercise of
jurisdiction by Estate Officer and the learned
Additional District Judge in awarding interest @15% p.a.
on the arrears of license fee/damages payable by the
petitioner to respondent No. 1 till 5.8.1989 on which
date the premises was vacated. It is appropriate that
this court invoked its superintendance powers and
extraordinary jurisdiction vested by Article 227 of the
Constitution to intervene and correct menifest error in
the order of the learned Additional District Judge
impugned in this petition.
15. Though both the parties have filed the statements
of accounts but they are at variance. The respondent
shall calculate the amount of simple interest payable by
the petitioner in terms of the order of Additional
District Judge @10% p.a. instead of 15% p.a.
16. The petition stands disposed of accordingly
leaving parties to bear their own cost.