Rajasthan Rent Control Act, 2001 – ss.4, 6, 7 & 14 – Default in payment of rent – Appellant-landlord let out shops to the respondent-tenant at the rent of Rs.8,500/- per month – Rent deed dated 19.08.1995 executed between the parties, contained a clause for yearly increase of rent by 10% – Accordingly, tenant paid the agreed rent with 10% enhancement yearly – In 2003, tenant was paying rent at the rate of Rs.16,564/- per month – In April 2003, tenant made payment upto month of July at the rate of Rs.16,564/per month – Thereafter, tenant committed default in payment of rent – Appellant-landlord issued notice dated 27.03.2004 demanding arrears from 01.08.2003 to 29.02.2004 amounting to Rs.1,15,945/- calculated @ Rs.16,564/- per month rent for period of seven months – Tenant deposited Rs. 95,200/- on 26.04.2004 and took the stand that in accordance with provisions of Act, 2001 w.e.f. 01.04.2003, on increasing the rent under the provisions of s.6, the prescribed rent of Rs.8500/- month @ 7.5% p.a. from 01.04.2003 comes to Rs.13,600/- p.m. – Accordingly, tenant deposited rent amount of Rs.95,200/- – Rent Tribunal held that the case of tenant that rent is payable @ 13,600/- p.m. cannot be accepted and directed for eviction of tenant – Same was upheld by Appellate Tribunal – However, High Court held in favour of the tenant – On appeal, held: s.6 of the Act, 2001 empowers the landlord to obtain revision of rent and to calculate the rent from date of initiation of tenancy – But in the event landlord does not choose to invoke the machinery of revision of the rent as provided in s.6 and s.14, the agreed rent between the parties shall not automatically be changed nor the tenant can unilaterally revise the rent – Further, s.4 of the Act which deals with the agreed rent, provides that rent payable for any premises shall subject to the provisions of this Act, be such as may be agreed between the landlord and the tenant – In the instant case, tenant was paying the rent of Rs.16,564/- per month before the enforcement of the Act as per the rent agreement – Said amount of Rs.16,564/- per month was agreed amount which was being paid before the enforcement of the Act – The arrears demanded by the notice dated 27.03.2004 i.e. Rs.16,564/- per month starting from August, 2003 to February, 2004 totalling Rs.1,15,945/- were required to be paid by the tenant and having paid only Rs.95,200/- as per his calculation of the rent at the rate of Rs.13,600/- per month, he has committed default – Also, landlord had not added 10% increase in the rent demanded, therefore, there was no breach of s.6 – High Court has committed error in allowing the writ petition of the tenant – Order of the Rent Tribunal restored.
Rajasthan Premises (Control of Rent and Eviction) Act, 1950 – s.6 – Rajasthan Rent Control Act, 2001 – s.6 – Held: A comparison of scheme of s.6 as it existed in Act, 1950 and s.6 as it brought under Act, 2001 makes it clear that although the tenant under the old Act was entitled to apply for fixation of standard rent if the rent was excessive whereas u/s.6 of the Act, 2001 tenant has not been given any right to pray for reduction of the rent. Rajasthan Rent Control Act, 2001 – s.9 – Notice by landlord demanding arrears of rent – Plea of tenant to relieve him from eviction – Tenability of – Held: In the present case arrears demanded by the notice i.e. Rs.16,564/- per month starting from August, 2003 to February, 2004 totalling Rs.1,15,945/- were required to be paid by the tenant and having paid only Rs.95,200/- as per his calculation of the rent at the rate of Rs.13,600/- per month has committed default – Order of the Rent Tribunal directing eviction of the tenant restored. Rajasthan Rent Control Act, 2001 – ss.4, 6, 7 , 9 & 14 – Discussed.
Allowing the appeals, the Court
HELD: 1. The important differences between the statutory scheme as contained in Section 6 of Rajasthan Premises (Control of Rent and Eviction) Act, 1950 and as now contained in Rajasthan Rent Control Act, 2001 are: (i) Under the old Act the landlord or the tenant both were entitled to file a suit for fixation of standard rent, if it is claimed that rent is either low or excessive. Thus, landlord could have moved the Court for enhancement of the rent and equally the tenant could have instituted a suit in the event the rent was excessive and the Court after holding inquiry was to determine the standard rent for such premises; (ii) In Section 6 of Act, 2001 the tenant has not been given any right to apply for revision of the rent on any ground. The old Act did not contain any prohibition regarding the annual increase of rent whereas Section 6 now contains the prohibition, restricting annual increase only by 5% for both the tenancies which were in existence prior to enforcement of the Act as well as tenancies which commenced after the commencement of the Act, 2001. [Para 13] [544-G, H; 545-A-C]
2. Sub-section (4) of Section 6 of the Act 2001, further provides that rent revised as per formula given under sub-section
(1) and sub-section (2) shall be payable, after the commencement of this Act from the date agreed upon between the landlord and the tenant or where any revision petition is filed, from date of filing of such petition. [Para 16] [546-A]
3. Section 14 of the Act, 2001 contains procedure for revision of rent which provides that landlord may seek revision of rent under Section 6 and 7 by submitting a petition before the Rent Tribunal accompanied by affidavits and documents, if any. Section 14 sub-section (1) uses the words “landlord may seek revision”. It is not obligatory for every landlord to seek revision of rent in accordance with Section 6. Section 6 contains provision entitling landlord to seek revision of rent notwithstanding anything contained in any agreement between landlord and tenant. Section
6 empowers the landlord to obtain revision of rent and to calculate the rent from date of initiation of tenancy. But in the event landlord does not choose to invoke the machinery of revision of the rent as provided in Section 6 and Section 14, the agreed rent between the parties shall not automatically be changed nor the tenant can unilaterally revise the rent. Section 6 is also beneficial to the tenant to the extent that any contrary agreement between the parties to increase the rent annually more than as provided under Section 6 cannot be enforced by a landlord after the enforcement of the Act. In the event landlord applies for revision of the rent, the revision of rent has to be in accordance with the formula as provided under Section 6(1) and 6(2) of the Act. The statutory scheme does not indicate that the tenant can unilaterally compute the rent as per formula under Section 6(1) from the inception of the tenancy and reduce the amount of rent which he was paying immediately before the enforcement of the Act. In the present case, the tenant has come up with the case in his written statement that he has recomputed the rent from inception of tenancy and has arrived at calculation that the rent payable with effect from the enforcement of Act, 2001 was Rs.13,600/- only and relying on the said computation he deposited an amount of Rs.95,200/in response to the notice. [Para 17] [546-B-G]
4. Section 4 of the Act which deals with the agreed rent provides that rent payable for any premises shall subject to the provisions of this Act, be such as may be agreed between the landlord and the tenant. When the tenant was paying the rent of Rs.16,564/- per month before the enforcement of the Act as per the rent agreement, the said amount was agreed amount which was being paid before the enforcement of the Act. It is true that in the agreed amount which was being paid immediately before the commencement of the Act, the landlord cannot increase @ 10% of the rent as per agreement. The increase after the enforcement of the Act shall be in accordance with Section 6 and in the event the tenant does not agree for the said increase, the landlord is free to file application under Section 6 read with Section 14. Thus, the High Court has not appreciated the true import of Sections 6 and 7 of the Act, 2001 in observing that the tenant is not in default. [Para 20] [547-F-H; 548-A]
5. In the present case arrears demanded by the notice i.e. Rs.16,564/- per month starting from August, 2003 to February, 2004 totalling Rs.1,15,945/- were required to be paid by the tenant, the tenant having paid only Rs.95,200/- as per his calculation of the rent at the rate of Rs.13,600/- per month has committed default. According to the tenant, the rent paid by the tenant was sufficient to cover the rent upto December, 2003 and part of January, 2004, admittedly, the arrears as demanded having not been paid and the Court having found that the landlord has demanded arrears of rent for seven months according to rate of rent Rs.16,564/per month which was being paid by the tenant even before the enforcement of the Act, 2001 and after the enforcement of the Act, 2001. The landlord having not added 10% increase in the rent demanded, there was no breach of Section 6 and the High Court has committed error in allowing the writ petition of the tenant. [Para 24] [550-D-F]
Prakash Mehra v. K.L. Malhotra (1989) 3 SCC 74 : [1989] 2 SCR 744 – referred to.
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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