* THE HON’BLE SRI JUSTICE M. SEETHARAMA MURTI CIVIL REVISION PETITION No. 650 of 2012 21.01.2014
Between
# Mrs. Waheedunnisa Begum @ Nafeez and others … Petitioners
$ Syed Abdul Razzak, s/o Syed Lateefuddin and others
...Respondents ! COUNSEL FOR PETITIONERS: Sri MR Mohd Irfan ^ COUNSEL FOR RESPONDENT : Sri Mirza Nisar Ahmed Baig < Gist:
> Head Note:
? CITATIONS: AIR 1974 Supreme Court 818 THE HON’BLE SRI JUSTICE M.SEETHARAMA MURTI Civil Revision Petition No.650 of 2012 ORDER:
This civil revision petition under Section 22 of the A.P. Buildings (Lease, Rent and Eviction) Control Act, 1960 (the Rent Control Act, for short) is directed against the orders dated 23.12.2011 of the learned Chief Judge, City Small Causes Court, made in R.A.No.165 of 2010 whereby the learned Judge had allowed the appeal and had set aside the order dated 26.11.2009 of the learned I-Addl. Rent Controller (holding FAC of the post of IV-Addl. Rent Controller) made in R.C.No.283 of 2004 filed by the landlord (since deceased) under Section 4 of the Rent Control Act for fixation of fair rent at the rate of Rs.3,000/- for the premises bearing No.4-1-494, situate at Troop Bazar, Abids, Hyderabad, more fully described in the schedule annexed to this petition.
2. The learned Rent Controller dismissed the petition of the landlord. The landlord died during the pendency of the appeal. His legal representatives continued the rent appeal. The same was allowed by the appellate authority. The tenants who are aggrieved filed this civil revision petition. In this revision petition, the parties shall be referred to as tenants / revision petitioners and respondents / landlords for convenience and clarity.
3. I have heard the submissions of the learned counsel for both the sides. I have perused the material record, including the pleadings, oral and documentary evidence and also the impugned order and the order of the learned Rent Controller.
4. There is no dispute with regard to the jural relationship between the tenants and the landlords. Originally, Syed Shah Mohinuddin, the husband of the 1st revision petitioner joined in the schedule premises as a tenant in the year 1982 and after his death, the revision petitioners, being his legal representatives are continuing as tenants and are carrying on business in the schedule property by paying a rent of Rs.100/- per month. At present, they are depositing the rent to the credit of R.C.No.323 of 2002 on the file of the learned IV-Addl. Rent Controller.
5. Be that as it may, the case of the landlords in the instant matter in brief is as follows: ‘The deceased tenant used to pay Rs.100/- in addition to Rs.200/-. He was thus paying Rs.300/- per month towards rent for the schedule premises as per the lease agreement dated 12.08.1982. The deceased landlord filed R.C.No.658 of 1992 on the file of I-Addl. Rent Controller, Hyderabad, on the ground that the deceased tenant committed defaults in payment of rents. The said petition was dismissed. Taking advantage of the dismissal of the rent control case, the tenants/revision petitioners herein filed R.C.No.323 of 2002 on the file of the IV-Addl. Rent Controller and are depositing the rents at the rate of Rs.100/- per month as per the orders in the said case. The tenants have to pay Rs.300/- per month;
and they shall also pay rent by enhancing the rent at the rate of Rs.50/- for every five years as per the agreement executed by the deceased tenant. Since the inception of the tenancy, the revision petitioners are paying the rent at the rate of Rs.100/- per month only. The said rent being paid by them is very meagre when compared to the rents of similar premiseses adjacent to the schedule premises and in the vicinity. The schedule premises is situate in a commercial market locality and the locality is a prime locality for business and commercial activity and an accommodation similar to the schedule premises fetches Rs.3,000/- per month. There has been a revolutionary change in the market values of properties in the areas of Abids, Koti and surrounding areas and the land value had increased exorbitantly to Rs.30,000/- per square yard and it is difficult to obtain a mulgi on sale and it is very difficult to get a shop on rent without paying huge premium and deposit. The revision petitioners neither conceded nor agreed to enhance the rent and for the last 22 years they are paying the same rent. Hence, the landlord has no option but to file the petition for fixation of fair rent at the rate of Rs.3,000/- per month for the schedule premises.’
6. The defence of the tenants/revision petitioners in brief is this: ‘The lease was obtained by the husband of the 1st petitioner for 50 years on a monthly rent of Rs.100/- and as per the lease deed, the deceased landlord has to pay the property taxes. But he had failed to do so. The municipal authorities issued a notice to the landlord on 01.12.1983 to pay Rs.7,349.45p towards arrears of property taxes. The municipal authorities confiscated articles worth Rs.10,000/- which belonged to the deceased tenant. And the said fact was intimated to the deceased landlord and he was requested to adjust Rs.10,000/- towards future rents. The said amount was adjusted towards rents upto November, 2002 at the rate of Rs.100/- per month. After such adjustment, the 1st revision petitioner being the elder member of the family tendered the rent to the deceased landlord from November, 2002, but he had refused to receive the rents. The rents sent by money order were also refused. The 1st revision petitioner got issued a legal notice to the deceased landlord requiring him to specify the bank account and name of the bank. He did not comply with the request in the said notice. Hence, the 1st revision petitioner filed RC.No.323 of 2002 and sought permission and is depositing rents at the rate of Rs.100/- per month since then. The eviction petition in R.C.No.658 of 1992 filed by the deceased landlord was dismissed. The appeal filed by him was also dismissed. The deceased landlord was holding a deposit of Rs.1,50,000/- which he received from the deceased tenant. The schedule premises admeasures 10’ x 16’ (width x length) and it is more than 100 years old. The period of lease under the registered lease deed dated 11.08.1982 is still subsisting and hence the petition is liable to be dismissed.’
7. During the course of enquiry before the learned Rent Controller, the deceased landlord was examined as PW1 and the 1st revision petitioner was examined as RW1. The market value certificate and a rough sketch were exhibited as exhibits A1 and A2. The certified copy of the lease deed dated 11.08.1982 and the certified copy of the order dated 30.11.2006 in R.C.No.284 of 2004 and the certified copy of the deposition of RW1 in R.C.No.323 of 2002 were exhibited as exhibits R1 to R3. On merits, the learned Rent Controller had dismissed the petition. The learned appellate authority while allowing the rent appeal fixed the fair rent for the schedule premises at the rate of Rs.3,000/- per month.
8. The short point is – ‘whether the impugned order fixing fair rent at the rate of Rs.3,000/- per month is unsustainable under facts and law and, if so, whether the impugned order is liable to be set aside?’
9. (a) Admittedly, the schedule premises is a shop/non-residential premises situate in Troop Bazar of Abids which is a commercial locality. The deceased landlord and the deceased tenant who are the predecessors in interest of the respondents and the revision petitioners herein originally entered into a registered lease deed dated 11.08.1982. The copy of the same is exhibit R1. The term of lease agreed to under the said document is 50 years from the date of commencement of the lease i.e. 10.08.1982. The lease period expires by 09.08.2032. The lessee was given liberty to utilise the premises either for commercial or residential purposes and to undertake any additions/alterations to suit his convenience and also to sublease the said mulgi to any person/persons as per his wish. The lessee can pay all the electricity consumption charges, and water cess. It is the responsibility of the lessor to pay the property tax. The most relevant term is that the lessee shall pay the monthly rent at the rate of Rs.100/- to the lessor towards rent for the premises during the lease period and shall obtain proper receipt for the same from the lessor. In the background of the agreed terms of lease, the contention of the landlords is that the property is admittedly situate in a very important commercial/market locality of Hyderabad and that since 22 years, the tenants are paying the same rent of Rs.100/- per month which is very meagre and that there is a revolutionary change in the market values and property values and that at present the property value at Abids is Rs.30,000/- per square yard and that it is very difficult to secure a shop premises either on sale or lease, and that for obtaining lease of a shop premises huge premium and deposit is required to be made. On the other hand, the case of the tenants is that the property admeasuring 10’ x 16’ is a construction of more than 100 years old and that the period of lease is subsisting and that as per the terms of the lease deed, the rent payable is Rs.100/- per month during the lease period and that therefore the petition is not maintainable.
9. (b) In the light of the said defence which is based on the terms in the registered lease deed, which are referred to supra, the learned rent controller had dismissed the petition. On the other hand, the learned appellate authority held that there is no clause in the lease deed prohibiting enhancement of rents and that simply because the lease period is subsisting and the agreed monthly rent is Rs.100/- during the lease period, it cannot be said that the rent controller has no authority to fix fair rent for the schedule premises. Therefore, for the above said reasons, the learned appellate authority had fixed the fair rent at the rate of Rs.3,000/- per month for the schedule premises considering inter alia the aspects viz., the situation of the property at Abids which is a prime business locality in the heart of the city, the rent at the rate of Rs.100/- is being paid since 1982 till date of the filing of the petition and that despite the agreement between the parties, the provisions of the Act empower the rent control authority to fix the fair rent. Now, the only short but important question is as to whether the provisions of the Act empower the rent control authority, if the facts of the case so warrant, to fix fair rent at a higher rate than the rent that was agreed to be payable between the parties.
9. (c) I have carefully read the provision of law viz., Section 4 of the Act. As per the provision, on the application by the tenant or the landlord of a building, the controller shall fix the fair rent for such building after holding such enquiry as the controller thinks fit. The Act does not make a distinction between a statutory tenant and a contractual tenant in the matter of fixation of fair rent. Therefore, the landlord is entitled to make an application for fixation of fair rent during the subsistence of contractual tenancy. The provision also says about the matters to which the controller shall have due regard in fixing the fair rent under the Section. There is nothing in the Section specifically limiting the powers of the controller. There is nothing to suggest that the fixation of fair rent can only be downwards from the contracted rent. Simply because the rent was mutually fixed and the contracted rent was and is being paid by the tenant to the landlord during the currency of the lease and the same contracted rent was agreed to be paid during the unexpired contracted period of lease that was agreed to between the parties, it cannot be said that the controller has no power to deal with such matter and fix fair rent upwards from the contracted rent having due resort and regard to the facts and the provisions of the Act. The Act contains the law relating to regulation of leasing of buildings, the control of rent thereof and the prevention of unreasonable eviction of tenants therefrom. The Act cannot be said to be a beneficial legislation meant only for the tenants as the Act regulates the incidence of tenancy and inter se rights and obligations of the landlord and tenant. The Rent Control Act is an enactment beneficial to both the landlord and the tenant, though the principal object of the rent control Act may undoubtedly be the protection of the weaker section of tenants from unreasonable eviction and extraction of unfair rent. Further, as per the provisions of the Act and the law laid down in precedents, while fixing fair rent, regard shall be had to the prevailing rates of rents in the locality for the same or similar accommodation in similar circumstances and to the circumstances of the case like the age of the building, amenities provided etcetera including any amount paid by the tenant by way of premium/advance. A reading of the provision of law would show that the provision of the statute confers a substantive power on the controller to fix a fair rent of a building after holding enquiry as may be considered necessary. Therefore, the provision of law shall be given effective operation without being subject to any contracts/agreements between the parties. Non- exercise of jurisdiction in case of this nature, in the well considered view of this Court, will stifle one of the objectives of the legislation that the rent payable by the tenant to the landlord of a building shall be fair rent for such building. In the decision in M/s RAVAL AND CO., v. K.G.
[1]
RAMACHANDRAN AND OTHERS , the Hon’ble Supreme Court held that the fair rent is fixed for the building and is payable by whoever is the tenant either contractual or statutory and that what is fixed is not the fair rent payable by the tenant to the landlord but fair rent to the building and that the provision that both the tenant as well as the landlord can apply for fixation of fair rent would become meaningless if the fixation of fair rent can only be downwards from the contracted rent and the contracted rent was not to be increased. This decision was rendered while dealing with a case to which the T.N.Buildings (Lease and Rent) Control Act (18 of 1960) applied. Nevertheless, in view of the provisions of the rent control Act of the State of Andhra Pradesh, which are similar to those of the Rent Control Act of Tamil Nadu, the ratio laid down in the decision per majority applies on all fours to the facts of the present case, in the well considered view of this Court.
9. (d) Having regard to the provision of law, the precedential guidance, the facts of the case and in the light of the detailed discussion, coupled with reasons, this Court finds that the provisions of the Act empower the rent control authority, if the facts of the case so warrant, to fix the fair rent at a higher rate than the contracted rent that was agreed to be payable between the parties and that the provision applies to both contractual tenancies and statutory tenancies and the fixation of fair rent can be upwards from the contracted rent and the contracted rent can be increased. Therefore, there is no legal bar as rightly held by the learned appellate authority to fix the fair rent to the building in question. The property is admittedly situated in Troop Bazar of Abids, which is a prime commercial locality in the city, of Hyderabad and the rent being paid at the rate of Rs.100/- per month is substantially a low and meagre amount. Further, the same rent is being paid for over a period of 22 years for the premises which the tenants are using as a non-residential premises for their business. Therefore, the rent fixed at the rate of Rs.3,000/- per month for the schedule premises, by any standards, can be termed as fair and not unfair, in the facts and circumstances of the case. Viewed thus, this Court finds that the order impugned brooks no interference.
10. In the result, the civil revision petition is dismissed. No costs. Miscellaneous petitions, if any, pending in this civil revision petition shall stand closed.
JUSTICE M. SEETHARAMA MURTI 21st January, 2014 ksm
[1] AIR 1974 Supreme Court 818