IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 13.06.2011 CORAM THE HONOURABLE MR. JUSTICE V.PERIYA KARUPPIAH CRP.NPD.No.349 of 2006 and C.M.P.No.2685 of 2006 Hemalatha Dolia .. petitioner Vs. Rajammal .. Respondent This revision has been filed under Section 25 of the Tamil Nadu Buildings Lease & Rent Control Act, 18 of 1960 against the judgment and decree dated 17.01.2006 made in R.C.A.No.984 of 2002 on the file of VIII Judge, Small Causes Court, Chennai, reversing the order and decreetal order passed in R.C.O.P.No.2375 of 1998 dated 17.09.2002 by the learned XI Judge, Small Causes Court, Chennai. For Petitioner : Mr.D.Ashok kumar For Respondent : Mr.P.K.Sabapathi ORDER
This revision has been filed by the petitioner against the judgment and decree passed in R.C.A.No.984 of 2002 by the Rent Control Appellate Authority dated 17.01.2006 in passing order of eviction on the ground of wilful default by setting aside the order of dismissal of the R.C.O.P.No.2375 of 1998 dated 17.09.2002.
2. The petitioner is the tenant and the respondent is the landlady. For convenience sake the rank of the parties to this revision will be maintained as tenant and landlady.
3. The case of the landlady before the lower court in the petition filed by her would be as follows:
(i) The petitioner is the landlady of the schedule mentioned property and the respondent is the tenant. The tenant is carrying on textile business in the name and style of “Krishna wearhouse” in the said shop premises for a monthly rent of Rs.660/- and the said rent is payable on or before the end of first week of every succeeding English Calendar month. The tenant did not pay the rent from December 1997 to October 1998 for a period of 11 months. The tenant is in arrears of rent for a sum of Rs.7,260/- till the date of petition. The tenant did not pay the arrears of rent despite repeated demands and reminders. Therefore, the tenant committed wilful default.
(ii) The landlady’s son has passed a degree in B.E. Mechanical Engineering and passed a Diploma in computer programming and he wants to start a computer institute in the demised premises. He is an unemployed graduate and he wants to do self employment. Therefore, the shop in the premises is bonafide required for the landlady’s son’s use and occupation. Landlady sent a notice dated 25.07.1998 to the tenant through her counsel requiring the tenant to vacate the petition mentioned premises and to handover possession of the same and also to pay the arrears of rent. The tenant neither paid the arrears of rent nor sent any reply to the said notice. The tenant did not pay any rent from December 1997 till date and has not vacated the petition mentioned premises to enable the landlady’s son to start computer institute. Therefore, the landlady prays for passing an order of eviction against the tenant and direct the tenant to hand over vacant possession of the premises to the landlady.
4. The contentions raised by the respondent/tenant before the Rent Controller would be thus:
(i) The respondent became tenant 8 years ago for the purpose of running the business in textiles and opticals under the name and style of “Krishna Wear house and Opticals” and it is a sole proprietary concern. The rent has been paid by the tenant regularly and the relationship in between the landlady and the tenant was cordial and the landlady used to receive the rents consolidatedly two or three months together. The tenant had suddenly arranged the marriage of her daughter and due to other incidental family expenditure the tenant could not pay the said arrears of amount and she pleaded for one month time to pay the entire arrears and the landlady has also agreed for the same and thereafter when the tenant had tendered the amount, the landlady had refused to receive the same and wanted only vacant possession. The tenant had approached the landlady even after sending legal notice and the landlady was prepared to drop the proposed litigation provided the tenant had paid the entire arrears and thereafter the tenant requested for 10 days time and in the meanwhile the landlady had approached the court and had an ex-parte order of eviction. The tenant had understood the evil design of the landlady in evicting the tenant at any cost. The respondent/tenant filed an application to set aside the ex-parte order in M.P.No.403 of 1999 to set aside the ex-parte decree and the same was allowed by the Rent Controller. It is not correct to state that the tenant is a defaulter in payment of rent because the tenant offered the rent to the landlady, but she refused to receive the rent who was already holding the advance of Rs.10,000/-. The entire arrears have been deposited by the tenant into court after the ex-parte order of eviction has been set aside and there is no wilful default in paying the rent.
(ii) The landlady has already filed an eviction petition in R.C.O.P.No.2374 of 1998 against one “Vikas Jewellery” and got him vacated from the said premises and in the said portion she had commenced the business in computers in the name and style of “S.R.Infonet”. Therefore, the plea of eviction on the ground of owner’s occupation does not exist at all. The landlady who is holding the advance of Rs.10,000/- cannot say that the tenant is at fault. Even otherwise the tenant has paid the entire arrears immediately after the ex-parte order has been set aside and therefore, the petition has to be dismissed.
5. Learned Rent Controller had examined the petitioner and her son respectively as P.W.1 and P.W.2 and also had admitted Exs.P1 to P6 on the side of the landlady and examined the tenant as R.W.1 and admitted Exs.R1 and R2 on the side of the tenant and had come to the conclusion of dismissing the Rent Control Petition seeking eviction on the ground of wilful default and of own occupation and thereby the petitioner’s/landlady’s request for eviction was rejected.
6. Against the order passed by the learned Rent Controller the petitioner/landlady had preferred an appeal and in the said appeal the learned Rent Control Appellate Authority has confirmed the order of the learned Rent Controller passed under 10(3)(a)(iii) for owner’s occupation but had allowed the appeal and ordered eviction on the ground of wilful default. The respondent/tenant before both the Forums had preferred the revision against the said order of Rent Control Appellate Authority. No revision has been preferred by the landlady against the concurrent rejection of eviction on the ground of owner’s occupation.
7. Heard Mr.D. Ashok kumar, learned counsel for the petitioner/tenant and Mr.P.K. Sabapathi, learned counsel for the respondent/landlady.
8. Learned counsel for the petitioner/tenant would submit in his argument that the finding of the lower court in refusing the decreetal and fair order passed in R.C.O.P.No.2375 of 1998 filed on the ground of wilful default under Section 10(2)(1) of Rent Control Act is erroneous as no reason has been stated for the finding of the Rent Controller in dismissing the said claim. He would further submit in his argument that the landlady did not disclose the payment of Rs.10,000/- as advance paid by the tenant to which she had to subsequently admit in her evidence. He would also submit in his argument that the finding of the Rent Controller in a Section 11(4) application that the entire arrears paid by the tenant was not challenged by the landlady was not considered by the lower court. He would further submit in his argument that the advance amount of Rs.10,000/- is being an enormous amount, the landlady is liable to adjust the entire advance amount leaving one month rent as advance and in such circumstances, there would not be any wilful default on the date of petition. He would further submit in his argument that entire arrears of rent was tendered on the date of first hearing after the ex-parte order of eviction was set aside and therefore, there could not be any wilful default, despite an advance of Rs.10,000/- was at the hands of the landlady. He would also submit in his argument that there was no arrears of rent on the date of filing of the petition, if such adjustment has been made in the huge advance paid by the tenant. He would also draw the attention of the court to a judgment of this court reported in 1996 T.L.N.J 407 (Selvaraj vs. Meenakshi Bai and another) for the principle that the ground of wilful default in payment of rent which would be less than the advance amount in the hands of the landlady would not be a wilful default and the tenant is not liable to be evicted. He would also bring it to the notice of this court, a judgment of Hon’ble Apex court reported in 1996 (3) SCC 45 (K.Narasimha Rao vs. T.M. Nasimuddin Ahmed) in support of his argument. Therefore, he would request the court that the order of eviction passed by the lower appellate court on the ground of wilful default may be set aside by confirming the order of dismissal passed by the learned Rent Controller and thus the Revision may be allowed.
9. Learned counsel for the respondent/landlady would submit in his argument that the lower appellate court was correct in coming to the conclusion that the tenant had committed wilful default since the tenant did not pay the rent immediately after receiving the notice in the RCOP, but remained ex-parte and the ex-parte order was set aside on her application and thereafter, she paid the entire arrears and that too was received by the counsel for the landlady without prejudice to her case and therefore, the default would be amounting to wilful default and it cannot be cured by the subsequent payment during the pendency of the Rent Control Petition. He would further submit that the tenant was irregular in paying the rent even during the previous periods and she herself admitted in her counter as well as in her evidence that she was not able to pay the rents payable to the building ddue to the marriage of her daughter and that would show that she was irregular in paying the rent payable to the premises. He would also submit in his argument that the tenant was not regular even after the filing of the petition and she did not pay the rent regularly but once in four or five months she deposited the amount into court and therefore, the said act would be amounting to wilful default. He would further submit that the lower court has correctly come to the conclusion that the tenant had even exceeded the remaining of the advance amount at Rs.9340/- as on 11.02.2000 and on that day instead of paying Rs.17,160/- she had paid only a sum of Rs.14,000/- only. Therefore, she committed wilful default. He would cite a judgment of this court reported in 2009 (2) CTC 495 (Nandi Khanna and another vs. Suneel Aiyer and another) in support of his argument that the adjustment of advance amount towards arrears of rent is not permissible when arrears of amount exceeds advance amount. The learned counsel for the respondent/landlady would further submit in his argument that the default in payment of rents even after the commencement of the proceedings before the Rent Controller or Rent Control Appellate Authority, such default would be deemed as wilful default and even though the default committed prior to the petition was not found wilful, the subsequent commission of wilful default during the course of proceedings would also make the tenant committing wilful default in payment of the rent. He would cite a judgment of this Court reported in 2000 (3) MLJ 460 (B.Sarojini ..vs.. Rajeswari Subramaniam and others) in support of his argument. He would also bring it to the notice of this Court yet another judgment reported in 1997 (III) CTC 39 (S.Venkatesulu ..vs.. V.Chandra and others) to the principle that subsequent conduct in non-payment or non-deposit of rent will establish wilful default of rent on the part of the tenant. He would also bring it to the notice of this Court that similar view has been reached by this Court in yet another judgment reported in 1997 (III) CTC 476 (Vijayakumar ..vs.. Ravindran). He would further submit in his argument that the supine indifference on the part of the tenant in payment of rent can be inferred if she was not regular in payment of rent even subsequent to the filing of the petition. He would also cite a judgment of this Court reported in 1997 (2) MLJ 467 (Poorman’s Depot Registration firm ..vs.. Krishnan) for the said proposition. Therefore, he would request the court that the finding of the lower appellate court that the tenant had committed wilful default and therefore, the order of eviction passed by the Appellate Authority in R.C.A.No.984 of 2004 may not be set aside and the revision may be dismissed.
10. I have given anxious consideration to the arguments advanced on either side. The only point to be considered in this revision would be whether the reversal order passed by the lower appellate court against the finding of the Rent Controller that the tenant did not commit any wilful default in paying the rent is liable to interfered or not.
11. Indisputable facts in between parties are that the building was let out by the landlady to the tenant for commercial purpose to conduct textile and opticals business under the name and style of “Krishna Wear house and Opticals” for a monthly rent of Rs.660/- and the tenant continued as tenant for about 8 years prior to the filing of RCOP. Even though the landlady did not disclose the payment of advance of Rs.10,000/- by the petitioner at the time of inception of tenancy, the landlady had categorically admitted in her evidence that the tenant had paid a sum of Rs.10,000/- towards advance amount. Apart from that the rent was paid by the tenant once in two or three months and the landlady was also acknowledging the same till she issued a notice (Ex.P1) on 25.07.1998. It is not disputed that the rent as claimed in the petition has not been paid by the tenant for the period commencing from December 1997 till October 1998 (i.e) for a period of 11 months and the said arrears was to an extent of Rs.7260/- was not paid on the date of petition by the tenant.
12. As far as the finding reached by the lower court that the arrears of rent was more than Rs.17,160/- as on 11.02.2000, when a sum of Rs.14,000/- was paid by the tenant after entering appearance in the RCOP after the ex-parte order of eviction was set aside against her and it is more than the advance amount of Rs.10,000/- and therefore, it is amounting to wilful default. Several decisions of this court had been followed for the said decision reached by the Appellate Authority. It did not consider that the wilful default was only for a period of 11 months as claimed in the petition. Moreover, it is not the case of the landlady that an advance of Rs.10,000/- has been paid and after adjusting with the advance amount, a remaining sum of Rs.9340/- towards the arrears of rent was payable from the month of December 1997 till October 1998. In the said circumstances, whether the judgments relied upon by the lower court for reaching the conclusion that the tenant had committed wilful default are applicable is the question to be decided in this revision.
13. Moreover, the learned counsel for the landlady relied upon yet another judgment of this court reported in 2009 (2) CTC 495 (Nandi Khanna and another vs. Suneel Aiyer and another) in support of his case. The relevant portion would run as follows:
“15…. Even if the contention of the learned counsel for the revision petitioners is taken into consideration, after excluding 1 month’s rent from the advance of Rs.75,000/- the balance advance amount ofRs.64,000/- if adjusted towards arrears of rent of Rs.99,000/-, even then there is balance of Rs.35,000/- to be paid by the tenants on the date of filing of the petition under Section 11(4) of the Act filed under M.P.No.556 of 2007 in R.C.O.P.No.1267 of 2007. On behalf of the respondents a calculation memo was also filed before this court-page 16 of the type set of papers produced by M/s. Dev Sai, counsel for the respondents at page 17 the rent due from the tenant as on 19.01.2009 is shown as Rs.1,06,000/-. So it is clear that even after the filing of the RCOP and also during the pendency of the R.C.A., the tenants have committed default in payment of rent.”
As regards the contention of the tenant, that she did not commit any wilful default, since a sum of Rs.10,000/- was available on the date of filing of the petition is concerned, I have to peruse the evidence adduced on either side. It was a practice adopted by both landlady and tenant accepting the rent payable by the tenant once in two or three months considering the difficulty faced by the tenant in meeting out the expenditure incurred by her due to the marriage of her daughter. Thereafter, the petition was filed by the landlady before the learned Rent Controller for evicting the tenant on two grounds namely, wilful default and owner’s occupation.
14. The period of default mentioned in the petition was from December 1997 to October 1998 for a period of 11 months. Learned Rent Controller has come to a conclusion in the application under Section 11(4) of the Act filed by the landlady that the advance amount of Rs.10,000/- in the hands of the landlady, after deducting one month rent of Rs.660/- for advance amount the available remaining sum of Rs.9340/- along with the sum of Rs.14,000/- paid on 11.02.2000 would be more than the arrears of rent payable during the pendency of the Rent Control Proceedings and therefore the Section 11(4) application was dismissed. The said finding of the Rent Controller was not appealed by the landlady and therefore, it would be binding on the landlady to the extent that the payment of rent during the said period was not amounting to wilful default.
15. At this juncture it has to be seen the judgment of Hon’ble Apex court reported in 1996 (3) SCC 45 in between K. Narasimha Rao vs. T.M. Nasimuddin Ahmed. The relevant passage would be thus:
” 12. For the purpose of this case, it is sufficient for us to say that there are provisions in the Bihar Act, which clearly make it illegal to claim or receive any payment in excess of the amount in addition to the rent or any sum exceeding one month’s rent in advance and there is a clear declaration that any excess amount received would not be lawful. There is no provision in the Bihar Act corresponding to that in sub-section (1) and (2) of Section 7 in the Tamil Nadu and Andhra Pradesh Acts, which creates a legal obligation in the landlady to refund the excess amount to the tenant creating a corresponding right in the tenant to recover that amount from the landlady. The absence of such a provision in the Bihar Act making the excess amount refundable and imposing an obligation on the landlady to make that refund immediately or to adjust it, is the distinguishing feature in the Bihar Act. However, on the clear provision of the Tamil Nadu Act which applies in the present case, there is no ambiguity. Further reference to the decisions under the Bihar Act is. therefore, not necessary.
13. In the present case, excluding from consideration the tenant’s claim for adjustment of the amount of Rs.1000/- spent on repairs and the amount of Rs.750/- sent by demand draft on receipt of the notice, the amount of Rs.2850/- with the landlady as the excess amount of advance paid by the tenant to the landlady, was alone sufficient to negative the landlady’s claim of ejectment. The arrears of rent from July to November 1990 was only Rs.750/- , while the excess amount of advance was Rs.2850/-, far in excess of the arrears. The landlady was bound to immediately refund that excess amount even before the arrears accrued, and he not having made the refund was bound to adjust it towards the rent due from the tenant. On these facts, the tenant could certainly not be held to be a willful defaulter in the payment of rent. The High Court is, therefore, right in deciding against the landlady.
This court has also relied upon the said judgment of Hon’ble Apex court made in a judgment reported in 1996 T.L.N.J 407 (Selvaraj vs. Meenakshi Bai and another). The relevant passage would run thus:
“… Admittedly, the landlady respondent herein has received an advance of Rs.105/-. Therefore, as per the recent Supreme Court judgment reported in K.Narasimha Rao vs. T.M. Nasimuddin Ahmed (AIR 1996 SC 1214), the landlady was bound to adjust the amount of advance paid by the tenant and refund the excess amount even before arrears accrued. In this case, the landlady has not done this. The landlady not having made the refund was bound to adjust it towards the rent due. The Supreme Court has held in the above case that for the non-adjustment of advance towards the rent by the landlady, the tenant cannot be said to be a wilful defaulter.”
On a careful perusal of the said judgment of this court in a similar circumstances, this court has applied the principle of Hon’ble Apex court and had allowed the revision.
16. In this case the landlady did not disclose in the petition that a sum of Rs.10,000/- was paid as advance for the lease of the said property, but she had admitted in her evidence that a sum of Rs.10,000/- was with her on the date of filing of the petition. The non payment of rent as on the date of filing the petition was 11 months i.e Rs.7260/-, but the remaining amount of advance at the hands of the landlady would be Rs.9340/- which is more than the arrears of rent.
17. As per the dictum laid down by the Hon’ble Apex court in the above referred judgment, the landlady ought to have adjusted the arrears of rent and thereafter, if any excess arrears of amount is payable by the tenant, whe can aply for eviction. In the judgment of this court cited by the learned counsel for the landlady it has been held that if the advance amount held by the landlady is less than the arrears of rent, then only the eviction could be ordered. This case is a different one from that of the case discussed in the judgment of this court reported in 2009 (2) CTC 495 (Nandi Khanna and another vs. Suneel Aiyer and another).
18. The judgment of this Court reported in 1997 (2) MLJ 467 (Poorman’s Depot Registration firm ..vs.. Krishnan) would putforth the following principle :-
“10. ….. The tenant is bound to pay the rent regularly as agreed. The subsequent conduct of the tenant can be taken into account to come to a conclusion whether there was any supine indifference on the part of the tenant in payment of rent during the relevant period. The evidence available on record would prove that the tenant was in the habit of paying the rent irregularly. There is no wrong in taking into consideration of the cumulative effect of the conduct of the tenant in payment of the rent to assess the nature of default. The appellate authority has applied his mind with respect to the documents and evidence to come to the conclusion that the tenant has committed default in payment of rent wilfully. In the circumstances of the case and on the basis of the evidence of record, I am not in a position to take a different view.”
19. The said view has been approved in the various judgments of this Court made in 1997 (III) CTC 476 cited supra, 1997 (III) CTC 39 cited supra and 2000 (3) MLJ 460 cited supra. Now, I have to see whether the petitioner / tenant had defaulted to pay the rent payable during the pendency of the proceedings or was she irregular in paying such rents payable for the period during the pendency of the proceedings. I have already discussed and found that the landlady did not file any appeal against the order of the learned Rent Controller passed in the application under Section 11(4) of the Act and therefore, there was no wilful default of payment of rent for that period. Now, the wilful default said to have been committed by the tenant is for the subsequent period during the pendency of the proceedings. In the particulars submitted by the petitioner by the way of deposit at Page Nos.24, 25, 26 and 27, We could see that the rents payable from August 2003 to May 2004 were paid only on 19.06.2004 and it was received without prejudice to the contention of the landlady. Similarly, the rent payable from June 2004 to August 2004 was paid only on 05.09.2004. The rent payable for the month of February 2005 to June 2005 was paid only on 09.08.2005. All these payments made by the petitioner / tenant was received by the respondent / landlady without prejudice to her case. No doubt, it is true that the said payments were made after the cumulation of rent for three or four months and were paid by the petitioner / tenant. They were not paid regularly on the next month without any default. This attitude of the petitioner / tenant would go to show that she was not regular in paying the rent during the course of the proceedings.
20. Even though the petitioner / tenant was found not committed any wilful default during the period prior to the filing of the petition, but in the application filed under Section 11(4) of the Act she was irregular in payment of rents payable during the pendency of the proceedings as evidenced from the various hand slips produced in the typed set of papers. No contra argument was advanced in support of the said submission of the learned counsel for the respondent / landlady. In the said circumstances, we can see that the said act of the non-payment of the rent payable by the petitioner / tenant within the time is allowed by law would make her to commit default muchless wilful default, even though it is for the period during the pendency of the proceedings. The Rent Control Appellate Authority differed from the finding of the Rent Controller and ordered eviction on the ground of wilful default on the finding that the petitioner / tenant had committed wilful default for the period prior to the filing of the petition may not be correct, but at the same time the conclusion reached by the Rent Control Appellate Authority cannot be varied because the petitioner / tenant had committed wilful default from paying the rents payable during the course of the proceedings. Therefore, the conclusion of the learned Rent Control Appellate Authority is not interferable.
21. Therefore, the Civil Revision Petition is not allowable, accordingly, it is dismissed by confirming the executable order passed by the learned Rent Control Appellate Authority. In the peculiar circumstances, no order as to costs. Time for vacating the premises by the petitioner is six months. Consequently, connected Miscellaneous Petition is closed.
kpr/mra
To,
1. The VIII Judge, Small Causes Court
Chennai.
2. XI Judge, Small Causes Court,
Chennai