Delhi High Court High Court

Model Press Pvt. Ltd vs Mohd. Saied on 19 November, 2008

Delhi High Court
Model Press Pvt. Ltd vs Mohd. Saied on 19 November, 2008
Author: Pradeep Nandrajog
*      IN THE HIGH COURT OF DELHI AT NEW DELHI

%                           Date of Decision: November 19, 2008


+                           RFA 576/2007

MODEL PRESS PVT. LTD.                              ....Appellant
             Through:            Mr.Rajiv Behl, Advocate

                     versus

MOHD. SAIED                                       ....Respondent
                     Through:    Mr.Rajinder Dutt, Advocate and
                                 Mr.M.Salim, Advocate


+                           RFA 11 - 13/2006

JOGINDER LAL KUTHIALAL & ORS.            ... Appellants
              Through: Mr.Ravi Nath, Advocate

                                 versus

RAJESH KUMAR MEATLE                                ....Respondent
             Through:            Mr.B.B.Gupta, Advocate


Coram:
*   Hon'ble Mr.Justice Pradeep Nandrajog
    Hon'ble Mr.Justice J.R. Midha

1.     Whether reporters of local papers may be allowed
       to see the judgment?

2.     To be referred to the Reporter or not?

3.     Whether judgment should be reported in Digest?


PRADEEP NANDRAJOG, J.

1. Parties in RFA No.576/2007 were granted liberty to

file written submissions within a week when arguments were

concluded. More than a week has gone by. No written

submissions have been filed.

RFA 576/2007 & RFA 11-13/2006 Page 1 of 8

2. The plaintiffs of the two suits, out of which the

present appeals have arisen, are the landlords and have

suffered a rejection of the plaint as the finding returned by the

learned Trial Judge is that even as per the case pleaded in the

plaint Civil Courts have no jurisdiction to entertain the claim

for ejectment of the tenant of the respective suits.

3. The tenant of RFA No.576/2007 is enjoying the

tenanted premises since 1.11.1972 and is paying a rent of

Rs.1,285/- per month.

4. The tenant of the subject premises relatable to RFA

No.11-13/2006 is occupying the tenanted premises since

around the year 1932 and is paying a monthly rent of

Rs.89.60.

5. The two landlords tried their luck by seeking

ejectment of the respective tenant alleging that a Division

Bench of this Court, in the decision reported as 95 (2002) DLT

508 Raghunandan Saran Ashok Saran (HUF) vs. Union of India,

had quashed Sections 4,6 and 9 of the Delhi Rent Control Act

1958 being offensive to Article 14, 19(1)g and 21 of the

Constitution of India and that as a consequence the landlords

became entitled to receive rent at the market rate and since

market rate of rent when suits were filed was above Rs.3,500/-

per month, the tenants were liable to be ejected by the civil

courts because the tenancies were determined by issuing

requisite notice under the Transfer of Property Act calling upon

the tenants to surrender possession.

RFA 576/2007 & RFA 11-13/2006 Page 2 of 8

6. In Delhi, a tenant paying rent of less than Rs.3,500/-

per month is protected by the Delhi Rent Control Act 1958 and

can be ejected only by the Rent Controller on one or more of

the grounds enumerated under Section 14 of the Delhi Rent

Control Act 1958. It may be noted that prior to the

amendment incorporated in the Delhi Rent Control Act 1958 by

Act No.37 of 1988 with effect from 1.12.1988 all tenancies in

Delhi, irrespective of the rent payable, were covered by the

provisions of the Delhi Rent Control Act 1958. By Act No.37 of

1988 clause „c‟ was inserted in Section 3 of the Delhi Rent

Control Act 1958, the effect whereof is to exclude premises

whose monthly rent exceeded Rs.3,500/- per month from the

rigors of the Act.

7. It may be noted at the outset that the vires of Act

No.37/1988 and of clause „c‟ of Section 3 of the Delhi Rent

Control Act 1958 was upheld by the Supreme Court in the

decision reported as 1995 (1) SCC 104 D.C.Bhatia & Ors. Vs.

UOI & Ors.

8. The appellants suffered rejection of their plaints

because the admitted agreed rent of the two premises, as

noted herein above was far below Rs.3,500/- per month and

thus the bar created by Section 14 of the said Act to the

jurisdiction of the Civil Court has been held fatal to the suits.

9. The only contention urged at the hearing of the

appeals by learned counsel for the appellants was that since

Section 4, 6 and 9 of the Delhi Rent Control Act 1958 have

RFA 576/2007 & RFA 11-13/2006 Page 3 of 8
been struck down by this Court in Raghunandan Saran’s case

(supra), there was no embargo on the landlords to recover the

standard rent as determined by said provisions and hence the

rates at which rent could be realized by them as on date when

the suits were filed would determine the question whether the

Civil Court had jurisdiction and since it was pleaded in the

plaints that the market rate of rent was much more than

Rs.3,500/- per month, the plaints could not be rejected at the

thresh-hold.

10. Unfortunately for the appellants, the contention

afore-noted by their counsel holds no substance, though it is a

very emotive plea.

11. The Division Bench of this Court in Raghunandan

Saran’s case (supra) has very pithly summed up the ambit of

Section 4, Section 6 and Section 9 of the Delhi Rent Control

Act 1958 and since the vires of these Sections has been tested

and held to be offending Article 14, 19(1)(g) and 21 of the

Constitution of India, we need not note down the said

provisions as also the ambit thereof and the reasons for the

said Sections to be struck down, save and except to briefly

note that the legal position which emerged from the aforesaid

provisions is that once the standard rent was fixed as per

Section 6 of the Act, no rent in excess thereof could be

recovered by the landlord from the tenant and while

determining the standard rent under Section 9 of the Act, the

Rent Controller was obliged to determine the same as per the

RFA 576/2007 & RFA 11-13/2006 Page 4 of 8
formula prescribed under Section 6 of the Act. Thus, even the

agreed rent was susceptible, to be recovered by the landlord.

Not only that the standard rent became meaningless when

viewed in the light of inflation i.e. in terms of the actual money

value which the landlord got.

12. But, with respect to the agreed rent, wherever the

same is less than Rs.3,500/- per month and the tenant willingly

paid the same, the question of fixation of standard rent does

not arise. In such scenario, the issue of Section 4, 6 and 9

becomes irrelevant. The only issue which can be urged by the

landlord is that the agreed rent was limited to the duration of

the lease and after the same was over, the landlord would be

entitled to increase the rent.

13. But, unfortunately, for the landlords who are

receiving a rent of less than Rs.3,500/- per month, there is no

provision available for them to unilaterally increase the rent.

14. It would not be out of place to note that in para 28

of its decision in Raghunandan Saran’s case (supra), after

giving reasons as to why Section 4, 6 and 9 of the Delhi Rent

Control Act 1958 were ultra vires the Constitution, the Division

Bench held:-

“The provisions are archic. They contain no mechanism to
compensate the landlords to offset inflation. There ought to
be a mechanism to increase the agreed rents keeping in view
the price index.”

15. Thus, even the Division Bench which penned the

decision in Raghunandan Saran’s case (supra) made it clear

RFA 576/2007 & RFA 11-13/2006 Page 5 of 8
that a mechanism has to be put in place for the landlords to

increase the agreed rent keeping in view the price index.

16. The reason is obvious. Section 105 of the Transfer

of Property Act 1882 defines a lease of an immovable property

as a transfer of a right to enjoy immovable property for a

certain time, or in perpetuity, in consideration of a price paid

or promised, or of money, a share of crops, service or any

other thing of value, to be rendered periodically or on specified

occasions to the transferor by the transferee who accepts the

transfer on such terms. Thus, a lease is a contract, which

means, that all terms thereof have to be by a bilateral

consensus between the lessor and the lessee. Neither a

landlord can unilaterally increase the rent nor can the tenant

unilaterally decrease the same.

17. Section 14 of the Delhi Rent Control Act 1958 gives

as many as thirteen grounds on which a tenant can be ejected.

The Section starts with a non-obstante clause by clearly

recording that notwithstanding anything to the contrary

contained in any other law or contract, no order or decree for

the recovery of possession of any premises shall be made by

any Court or Controller in favour of the landlord against the

tenant. Thereafter, a proviso is inserted as per which on any

one or more of the thirteen grounds listed under the proviso

the landlord can recover possession from the tenant by

preferring an application before the Rent Controller.

RFA 576/2007 & RFA 11-13/2006 Page 6 of 8

18. The embargo created by Section 14 hits the instant

plaints. The vires of Section 14 of the Delhi Rent Control Act

1958 has not been challenged by the appellants.

19. It would also be not out of place to note that in

D.C.Bhatia’s case (supra) the Hon‟ble Supreme Court had to

say as under, in paras 57, 58 and 61 of the decision:-

“57. In view of the aforesaid, we are unable to uphold
the contention that the tenants had acquired a vested
right in the properties occupied by them under the
statute. We are of the view that the provisions of
Section 3(c) will also apply to the premises which had
already been let out at the monthly rent in excess of
Rs.3500/- when the amendment made in 1988 came
into force.

58. The last contention was as to whether the
term „rent‟ is to be construed as “standard rent” and
not as the rent which is actually being paid. This
argument is also not acceptable for a number of
reasons. Firstly, the legislature has not used the
expression „standard rent‟ in clause (c) of Section 3.
Words normally should be understood in the ordinary
dictionary meaning.

59. xxxx

60. xxxx

61. Moreover, the scheme and the purpose of
the Act are clear. Tenants who could afford to pay
more than Rs.3500/- per month by way of rent, were
being removed from the protective umbrella of the
Rent Act. Only thing that has to be seen for the
purpose of deciding the class of tenants, who were
being excluded from the ambit of the Rent Act, was
the exact amount of monthly rent that was being paid
on the relevant date i.e. 1-12-1988. There is no
precondition of fixation of standard rent before
application of the provisions of Section 3(c) of the
Act.”

20. It is unfortunate that after the decision in

Raghunandan Saran’s case, the legislature has not filled up

RFA 576/2007 & RFA 11-13/2006 Page 7 of 8
the vacuum created in the law with Sections 4, 6 and 9 of the

Delhi Rent Control Act 1958 being held ultra vires the

Constitution. The mechanism required to be put in place, as

observed by the Division Bench in para 28, has yet to find its

place. But, since under the garb of interpretation, this Court

cannot legislate, the inevitable consequence has to be that the

appellants can claim no more rent from their tenants other

than the agreed rent which the tenants are happily paying.

Since the agreed rent in both cases is far below Rs.3,500/- per

month, we hold that the learned Trial Judges were correct in

rejecting the plaints as indeed the claim for recovery of

possession against the respondents was not maintainable

before a Civil Court.

21. No costs.

PRADEEP NANDRAJOG, J.

J.R. MIDHA, J.

November 19, 2008
dk

RFA 576/2007 & RFA 11-13/2006 Page 8 of 8