The defendant is the appellant. Originally the plaintiff filed a suit before this Court in C.S.No.1636 of 1991 seeking for a relief of recovery of Rs.3,18,993.75p being the outstanding total arrears of rent from the defendant. The above suit was transferred to the IV Additional Judge, City Civil Court, Chennai in view of pecuniary jurisdiction being modified and the suit was renumbered as O.S.No.14426 of 1996. Thereafter, the plaintiff has filed an application to fix the fair rent for the building in H.R.C.No.5367 of 1981 and the Small Cause Court has fixed the rent at Rs.10,475/-. Aggrieved against the same, the defendant has preferred an appeal in R.C.A.Nos.643 of 1982 and 1329 of 1982. By an order dated 18.09.1982, the appeal was dismissed thereby confirming the enhanced the rent at the rate of Rs.10,475/- p.m. Therafter, the defendant has made a further request to give some more improvement to the property by providing car shed, by reconstructing the Garage in the ground floor and thereby spent a sum of morethan Rs.2 Lakhs. This improvement was done only by the specific understanding and agreement between the parties that the defendant shall pay enhanced rent as fixed by the C.P.W.D. After completion of work, the C.P.W.D. inspected the suit property and fixed the rent at Rs.16,000/- p.m. with effect from 25.10.1987.
2. As the defendant failed to pay the enhanced rent of the Rs.16,000/- p.m. with effect from 25.10.1987, the plaintiff filed R.C.O.P.No.3160 of 1989 for eviction on the ground of willful default. The Rent Controller, though held that the rent was payable at Rs.16,000/- p.m., dismissed the eviction petition and the same was affirmed in Appeal in R.C.A.No.728 of 1990. The defendant insisted to execute the lease agreement. Since, there was no lease agreement from the inception, the plaintiff would contend that the defendant is a Statutory tenant under the Tamil Nadu Buildings (Lease & Rent) Control Act and there is no such necessity to execute any lease deed. It is the further claimed that the defendant under a communication dated 21.03.1989 agreed to pay the enhanced rent at the rate of Rs.16,000/- p.m. with effect from 27.08.1997 and by virtue of that letter communicated to the plaintiff, they are bound to pay the rent at the rate of Rs.16,000/- p.m. whereas they paid the rent only at the rate of Rs.10,475/- being the rent as fixed by the Rent Court. Therefore, difference in rent was pending and payable from 1987 to 1991. Since the amount was not paid, the plaintiff had filed the present suit seeking for arrears of rent on the ground that the difference in rent has not been paid.
3. The defendant in the written statement has taken a specific plea that the suit claim, as claimed by the plaintiff is barred by limitation, as the suit is filed in the year 1991 for enhancement of rent from 1987 and hence is not legally sustainable. Further more, even though, the defendant admitted in the letter dated 21.03.1989 to pay the enhanced rent from 25.10.1987, they had said that the defendant and plaintiff would execute a fresh lease agreement. As the lease agreement was not executed by the plaintiffs, they were not bound to pay the enhanced rent and therefore the suit was not maintainable and that the suit is barred by limitation. Further, the defendant would also contend that they vacated the premises in the year 1994 itself. Therefore, the claim made by the plaintiff for recovery of the difference in rent is not maintainable.
4. The Court below framed the issues on the pleadings and evidence let in by both the parties. Ultimately, the trial Court holding that the admission made by the plaintiff in the letter dated 21.03.1989 is violated and then as the difference in rent has not been paid, decreed the suit as prayed for. Aggrieved against the said decree, the defendant has preferred the present appeal.
6. The learned counsel for the appellant vehemently argued that the rent as fixed by the Rent Controller which is the fair rent has been correctly paid throughout and there is no dispute at all till the vacant possession was delivered to the respondent/plaintiff. It is also further argued that when they have received the rent and adjusted it towards the amount, the question of difference in rent will not arise at all and if at all any amount is due, even that amount will not be liable from 1987 as it would be barred by limitation. Any claim from 1987 should have been made before a period of three years and hence the difference of rent from 25.10.1987 to December 1988 is not liable to be paid. Since the present suit was filed in December 1991, only the difference of three years prior could have been asked and in as much as they have included the claim which is time barred amount, the entire suit is not maintainable and lastly, he would further contend that in the letter written while accepting the enhanced rent, a specific condition has been put forward by the appellant namely that the parties should execute a fresh agreement which admittedly has not been executed. Therefore they are not liable to pay enhanced rent or the difference of enhanced rent and as the fair rent has been paid, in those circumstance, the lower Court wrongly came to the conclusion that the appellant should pay the difference in rent.
7. The learned counsel for the respondent categorically brought to the notice of this Court, the Ex.A11 which is a letter written by the appellant to the respondent which reads as follows.
" I am to refer to your letter dated 10.01.1989 and to inform you that the competent authority in the Government of India has sanctioned enhancement of rent to Rs.16,000/- (Rs.Sixteen thousand only) per month with effect from 25.10.1987 for the office premises of this Directorate subject to completion of all relevant formalities regarding execution of bonds etc. Accordingly, I am sending herewith a blank lease Agreement Form which may please be filled-in giving all the details required therein. The Lease Agreement Form thus filled-in may please be shown to this Directorate for approval before giving the same for fair typing. Since one party to the Lease Agreement is the Government of India, it is enough that the Lease Agreement is typed on blue bond paper which may please be done in quadruplicate. However, for registration purposes, it is understood that one copy of the lease agreement has to be typed in the copy paper supplied by the Registration Department / District Registrar. The copies of the lease agreement thus typed duly signed by you with your official seal may please be sent to this office for further necessary action."
8. He would only contend that as per the demand in the letter, it is clear that the Government of India had already sanctioned enhanced rent to Rs.16,000/- p.m. with effect from 25.10.1987 and then the subsequent things are only formalities. Even as per the own wordings all other formalities should be completed. The claim of the appellant at this point of time is hyper technical and even assuming that the formalities are not completed it is categorically admitted by the Government, that the enhanced rent is Rs.16,000/- p.m. It is admittedly accepted and sanctioned by the Government. He would also bring to the notice of this Court Section 25 Sub clause 3 of the Indian Contract Act is extracted here under:
"25. Agreement without consideration, void, unless it is in writing and registered, or is a promise to compensate for something done, or is a promise to pay a debt barred by limitation law. - An agreement made without consideration is void, unless--
(3) it is a promise, made in writing and signed by the person to be charged therewith, or by his agent generally or specially authorized in that behalf, to pay wholly or in part a debt of which the creditor might have enforced payment but for the law for the limitation of suits."
9. For the point that when the promise is made in writing, if it which includes a time barred debt also or time bar demand then that agreement is a valid agreement and definitly it is liable to be paid. In this connection he would rely upon the decision reported in AIR 1975 Madras 164 (Kapaleeswarar Temple v. T.Tirunavukarasu) which is extracted hereunder.
"2. .........Having regard to the terms of Ex.P-1, it is clear that the respondent had calculated the entire rent for the period ending 31.10.1968 at Rs.312/- and has further given a promise thereunder that he would pay off the sum of Rs.312/- at the rate of Rs.10/- per month that the first instalment was to commence from 10.11.1968 onwards and that if he committed any default it was open to the plaintiff to take appropriate action against him. It is therefore rendered clear that Ex.P-1 forms the basis of a fresh contract between the respondent and the plaintiff and the plaintiff is entitled to base that as the cause of action and institute a suit against the respondent for recovery of the amount undertaken to be paid by the respondent by and under the terms of Ex.P-1. The question as to whether any portion of the sum of Rs.312/- acknowledged to be paid by the respondent under Ex.P-1 to the plaintiff in monthly instalment of Rs.10/- was barred by limitation or not on the date of the execution of Ex.P-1 has no relevancy or significance and is a factor which has to be totally eschewed from consideration. It is to cases of this kind that
Section 25(3) of the Indian Contract Act would apply.....
3. If only the trial Judge or the Bench of Judges who decided the New Trial Application had adverted their mind to this signal provision in the Indian Contract Act, they would not have held the plaintiff to be entitled only to a portion of the amount claimed by him, but, instead would have held that the plaintiff was entitled to sustain his entire claim against the respondent on the basis of Ex.P-1. The reason for the Legislature having enacted a provision as
Section 25 (3) of the Indian Contract Act is not far off to see. It is no doubt, true that the Limitation Act provides a certain period during which alone a creditor is entitled to institute action against the debtor for recovery of the debt and if the creditor fails to institute the action within the time allowed to him by law, the debtor gets a vested right and is afforded opportunity to resist the action of the plaintiff on the ground that the claim is barred by limitation. However, it is equally open to the debtor to renounce or waive the right conferred on him by the Law of Limitation and bind or obligate himself afresh to discharge the debt incurred by him irrespective of the fact the debt had become barred by limitation on the date he gives the fresh undertaking to the creditor to pay off the debt. The principle is now well known that a person may renounce a benefit of law made for his own protection.
6. It is thus clear that there are a catena of decisions and plethora of authority for holding that though a debt might have become time-barred on the date a debtor entered into a fresh obligation with the creditor to pay the liability, the said obligation, if it satisfies the conditions laid down in
Section 25(3) of the Indian Contract Act, will amount to a fresh contract in the eye of law and can certainly be made the basis of an action for recovering the amount promised and acknowledged therein by the debtor. While
Section 18 of the Limitation Act (Section 19 of the old Act) deals with an acknowledgment made by a debtor within the period of limitation, the contractual obligation which a debtor enters into under the terms of
Section 25 (3) has no reference whatsoever to the acknowledged debt being within time or not. In that sense, the provision contained in
Section 25(3) is far wider in scope than the acknowledgment contemplated in
Section 18 of the Limitation Act. The contract entered into under
Section 25(3) is an independent and enforceable contract and has no reference to the debt acknowledged under the contract being a live one in the sense that it had not become barred under the law of limitation. This aspect of the matter has been totally lost sight of by the lower Courts. As already stated, the respondent has categorically stated under Ex.P-1 that he was indebted to the plaintiff in a sum of Rs.312/- till 31.10.1968 and consequently his undertaking under the terms of Ex.P-1 to discharge this amount at the rate of Rs.10/- per mensem is an independent contract and is clearly enforceable by the plaintiff....."
10. Therefore, he would contend that the question of limitation does not arise, therefore the lower Court has rightly come to the conclusion that the question of execution or non-execution of lease deed will not arise as statutory tenant is entitled all benefits under Tamil Nadu Building and Lease Rent Control Act. Therefore, the lower Court is correct in directing them to pay.
11. He would further contend that there is no lease agreement at any point of time and it was only on the specific understanding that the defendant would pay the enhanced rent especially after the inspection made by the CPWD authorities and the subsequent conduct by sending the letter definitely the appellant is liable to pay the amount. Even otherwise, in the earlier proceedings for eviction under the Rent Controller Act, it was agreed only Rs.16,000/- and in those circumstances they are liable to pay the amount.
12. On a careful consideration of the pleadings and evidence let in by both the parties and documentary evidence and on the submissions made by the both parties concerned, it is clear that the plaintiff had only claimed the difference in payment of enhanced rate of rent as admitted by the appellant to be paid to the respondent vide his letter dated 21.03.1989. A careful reading of the letter shows that the appellant had specifically written letter after getting necessary sanction of the Government of India for actual payment of Rs.16,000/- p.m. with effect from 25.10.1987. When this letter was sent, they were clear that they are definitely going to pay the enhanced rent from 25.10.87. That is why they obtained the sanction from the appropriate authority viz. the Government of India and then only they have written this letter. Of course, the letter also contemplated for completion of all formalities, they seek for execution of a fresh agreement to be written in the typed form, they have indicated in the letter that they would only use blank lease form which is typed in a white sheet or bond sheet and signed by them to be sent. It is unilateral contract which they want to execute and as stated by them it is only formalities to be completed. Therefore the arguments of the respondent is very correct in stating that once agreement has been reached between the parties to pay the rent from particular date, as in this case, with restrospective effect, mere fact that the subsquent formalities has not been completed and cannot be a ground for the appellant to deny, the difference in payment of rent. It would be more so in this case in view of the fact that the appellant is a statuatory tenant which has been in possession in the property for quite a long time and had never executed any agreement at all. In fact, the appellant has been entitled to the provisions of the Tamil Nadu Building and Lease Control Act and they also participated in the earlier proceedings when the rent controller fixed the rent under section 4 of the Tamil Nadu Building and Rent control Act and they have accepted the details and having participated in the proceedings, they are statutory tenant, without any agreement at all. It is not open to the appellant at this point of time to say that they have not accepted the enhanced rent as they have not entered into a new agreement. Such a course is not open to them. In this connection as rightly pointed out by the respondent counsel in Judgement reported in AIR 1975 Madras 164 (Kapaleeswarar Temple v. T.Tirunavukarasu) it was categorically held that:
"Though a debt might have become time-barred on the date a debtor entered into a fresh obligation with the creditor to pay the liability, the said obligation, if it satisfies the conditions of
Section 25 (3) will amount to a fresh contract and can be made the basis of an action for recovering the amount promised and acknowledged therein by the debtor. While
Section 18, Limitation Act, 1963, deals with an acknowledgment made by a debtor within the period of limitation, the contractual obligation which a debtor enters into under
Section 25(3) has no reference whatsoever to the acknowledged debt being within time or not.
5. ........Repelling the contention of the defendant therein the part of the claim was barred by limitation on the date the letter was executed and consequently the letter can not be treated as evidence of an agreement under
Section 25 of the Contract Act to pay a barred debt, the Bench observed as follows:
"Assuming that the debt or a portion thereof was barred, the letter contains an unconditional promise to pay whatever balance might be found to be due to the plaintiff. This is a valid agreement under
Section 25 of the Contract Act".
13. The learned counsel for the appellant has not established any grounds for inference or illegality in the judgement of the lower Court warranting interference at this point of time. In the result, the appeal is dismissed.
14. The learned counsel for the respondent has also brought to this notice of this Court lastly, that the respondent has suffered a loss from the beginning and in respect of the promise he has not received rent from 1987 to 1991 for whcih he filed the present suit and admittedly, the appellant vacated the premises only in the month of April 1994. The appellant surrended the possession of the property on 18.04.1994 when the eviction was pending before the High Court in C.R.P.No.1781 of 1993 and the plaintiff has not claimed the difference in pay from the year 1991 to 1994. In the facts and circumstances of the case, the appellant has no reason to contend that there was delay in the the procees of claiming, the payment of the money from 25.10.1987 to December 1991 when the suit was filed. Hence the appeal is dismissed. The decree passed by the lower Court is confirmed. No costs. The appellant is directed to pay the decreetal amount immediately.
15.12.2009 Index : Yes / No Internet : Yes / No ogy To
1. The IV Additional City Civil Judge, Chennai.
B.RAJENDRAN, J.
ogy A.S. No. 752 of 2002 15.12.2009