Madras High Court
R. Murugan vs M.O.M. Abubucker on 17 September, 2005
Equivalent citations: 2005(5)CTC473
Author: R. Banumathi
Bench: R. Banumathi
ORDER R. Banumathi, J.
Page 2241
1. This revision petition is preferred against the order of the Rent Control Appellate Authority/Principal Sub Judge Nagercoil, made in R.C.A.No. 5/2004, confirming the order of the Rent Controller/Additional District Munsif, Page 2242 Nagercoil in R.C.O.P.No. 17/1999, ordering eviction under Section 10(2)(i) and 10(3)(a)(iii) of Tamil Nadu Buildings (Lease & Rent Control) Act (in short, the Act). The tenant is the revision petitioner.
2. For convenience, the parties are referred to their original rank in rent control petition.
3. The demised premises relates to NMC 28/3-141, New No. 51/1, 141/1, Nagercoil. The respondent has become a tenant under the petitioner/landlord pursuant to a Lease Agreement. At the time of Agreement of Lease, the rate of rent per month was Rs. 225. Subsequently on 31st August, 1995, a fresh Lease Agreement was entered into between the petitioner and the respondent and the rate of interest was increased from Rs. 225 to Rs. 275. There was an earlier advance of Rs. 3,000 and further advance of Rs. 2,000 was paid on 31st August, 1995. Thus, a total advance that the petitioner gave is Rs. 5000. The petitioner/landlord has alleged that the respondent has paid the rent only up to June 1998 and therefore, the respondent had committed wilful default in payment of rent. At the time of filing the petition, the respondent was in arrears of rent for nine months. The respondent had tendered the Money Order for lesser amount without covering the whole arrears of rent. Hence the same was returned by the petitioner. The petitioner is an unemployed person. The building is required for his own use and for carrying on grocery business in the shop, which is situated in the busy locality. Hence, the petition for eviction was filed on the ground of wilful default under Section 10(2)(i) of the Act and for own use and occupation under Section 10(3)(a)(iii) of the Act.
4. Resisting the application, admitting the tenancy and the monthly rent of Rs. 275, the respondent/tenant has filed the Counter statement contending that the landlord has received an advance of Rs. 5000. Even prior to the filing of the petition, the rent was tendered by way of Money Order and the landlord refused to receive the same. Hence the respondent/tenant had sent the Legal Notice, requesting the landlord to inform the Bank Account Number. Under Ex. B4 - Notice, the petitioner/landlord sent a Reply Notice without specifying the name of the Bank. Hence the respondent has opened an Account in Kanyakumari District Central Cooperative Bank and continued to deposit rent in the Bank Account. Evenafter filing of the rent control petition, the tenant continued to deposit rent in the separate Bank Account and later deposited the same before the Court. Hence, there is no wilful default. On the ground of own use and occupation for running the grocery shop, the tenant has filed the counter statement alleging that the petition premises is not suitable for running the provisions stores, since it is located in the midst of schools, hardware shops and marriage hall.
5. In consideration of the evidence, the Rent Controller found that from August 1998, the respondent/tenant has not paid the rent till the disposal of the petition. It was further held that the advance amount of Rs. 5000 was only an advance and the same would not be sufficient towards the rental arrears. On the ground of bonafide requirement for the running of grocery shop, it Page 2243 was found that the petitioner/landlord has established his bonafide requirement for own use and occupation and it is not for the tenant to dictate the terms as to whether the petitioner/landlord should run his provisional store or not.
6. Confirming the findings of the Rent Controller, the Appellate Authority pointing out the deposit of Rs. 18,150 towards the rental arrears found that the tenant has committed wilful default. Referring to a number of decisions, the Appellate Authority found that the tenant has committed wilful default and that the bonafide requirement of own use and occupation of the landlord is well proved and confirmed the findings of the Rent Controller.
7. Assailing the concurrent findings of the Courts below, the learned Counsel for the Revision petitioner/tenant has submitted that when the petitioner/landlord was holding an advance for more than one month, the same could be adjusted towards the arrears of rent and that there was no wilful default. In support of his contention, the learned Counsel for the revision petitioner tenant has relied upon . It is further submitted that even after the filing of the eviction petition, the respondent/tenant continued to deposit the rent and there is no wilful default. Submitting that the petitioner/landlord owns other shops, the learned Counsel for the revision petitioner tenant has further submitted that one Mehar Ali has vacated the premises, which the petitioner has not occupied, which aspect was not properly appreciated by the Courts below. Submitting that the petitioner/landlord owns other shops, the learned Counsel for the revision petitioner has contended that the Courts below erred in finding that there is bonafide requirement of the premises for own use and occupation for running the grocery shop.
8. Countering the arguments, the learned Counsel for the petitioner/tenant has pointed out that the deposit of Rent of Rs. 18,150 in the Appellate Court, and that the Appellate Court has rightly held that non-payment of rent, even after filing of the petition clearly amounts to wilful default. It is submitted that the advance amount lying with the petitioner/tenant would not absolve the obligation of the respondent to pay the rent. It is further submitted that the mere deposit of rent before the Court would not make good the wilful default already committed. Placing reliance upon 2001 LW 559 SC, the learned Counsel for the petitioner has submitted that for running the grocery business, no extraordinary expertise is required and the Courts below have rightly ordered eviction on the ground of bonafide requirement for own use and occupation.
9. In consideration of the contentions of both parties, the impugned Order and other materials on record, the following points arise for consideration in this revision:
(i) Whether the order of eviction on the ground of wilful default is unreasonable and erroneous ?;
(ii) Whether the Courts below were right in finding the bonafide requirement of the petitioner landlord for own use and occupation ?
And;
Page 2244
(iii) whether the impugned Order suffers from unreasonableness, warranting interference, exercising the power under Section 25 of the Act ?
10. It is not in dispute that the respondent has become the tenant pursuant to the Lease Agreement. The monthly rent is Rs. 275. Including the advance of Rs. 3,000 earlier paid, the total advance of Rs. 5,000 has been paid by the respondent/tenant to the petitioner. The landlord has alleged that the tenant has paid the rent only up to June 1998 and subsequently committed wilful default in the payment of rent. The respondent/tenant has denied the same and contended that rent was sent by way of Money Order and the landlord refused to receive the same. Ex. B1 - Money Order was sent for a lesser amount i.e. only for one month - December 1998. According to the petitioner, money order was sent for a lesser amount and the same was not received. Thereafter, the tenant has sent the Legal Notice requesting the landlord to inform the Bank Account Number. The rent control petition was filed on 22nd April, 1999. From July 1998, till the filing of the petition, the rent was not paid. If Ex. B1 - Money order was so returned, the tenant must have complied with the mandatory provision under Section 8(5) of the Act. The respondent/tenant ought to have filed the petition for deposit of rent under Section 8 of the Act. As noted earlier, till the filing of the eviction petition, the respondent has not paid the rent. Even during the pendency of the rent control proceedings, the respondent has not deposited the rent in the Court. The contention of the respondent that he has been regularly depositing the rent in the Bank Account in the District Central Cooperative Bank is not substantiated by producing any Account Book. In any event, such deposit of rent before the Bank would not amount to compliance of all the mandatory provisions under Section 8(5) of the Act.
11. Elaborating the scope of Section 8 of the Act, in 2002 (4) CTC 572 [Palanisamy, E. v. Palanisamy D] the Supreme Court has held:
4. It would be seen from the above provisions that while the landlord is required to issue a notice of default, on refusal by the landlord to accept rent, the tenant is required to call upon the landlord by way of a notice to specify the name of a Bank in which rent could be deposited by the tenant to the credit of the landlord. If the landlord specify the name of the Bank to deposit the rent, there is an obligation on the part of the tenant to make the deposit of arrears of rent in the account of the landlord. However, if the landlord does not specify the name of a bank inspite of being called upon by the tenant through a notice, the tenant is required to send the amount of arrears through a money order to the landlord after deducting the commission payable on the money order. If the landlord still refuses to accept the rent, the tenant is entitled to file an application before the Rent Controller seeking permission to deposit the arrears of rent under Sub-section (5) of Section 8 of the Act.
12. In the said decision, the Supreme Court has referred to [M. Bhaskar v. J. Venkatarama Naidu]. With reference to similar provisions Page 2245 contained in the A.P. Buildings (Lease, Rent and Eviction) Control Act 1960 the Supreme Court observed that when the landlord is evading payment of rent, the tenant has to follow the procedure prescribed under Section 8 of the Act i.e. to issue notice to the landlord to name the Bank and if he does not name the Bank, the tenant has to file application before the Rent Controller for permission to deposit rent. The tenant did not follow that procedure. Omission to avail of the prescribed procedure disentitles the tenant to plead that there was no wilful default on his part. The landlord was, therefore, entitled to seek eviction on the ground of wilful default in payment of rent on the part of the tenant.
13. Admittedly, the tenant has not filed any petition for depositing the rent. He has remained content by issuing the notice and sending the Money Order only for one month - December 1998. Even after filing of the eviction petition, the respondent/tenant has not deposited the rent in the Court. For the first time, he has deposited the rent of Rs. 18,150 in the Appellate Court. In a similar case, where the arrears of rent was deposited in the first Appellate Court, the Supreme Court has observed that such deposit would not absolve the tenant of the wilful default committed. In [R.C. Tamrakar and Anr. v. Nidi Lekha], the Supreme Court has held:
Reading both the Sub-sections together we are of the opinion that the benefit of Sub-section (5) shall be available to a tenant provided he tenders the rent or deposits it in the Court within one month of service of writ of notice or notice of appeal or any other proceeding or within one month of the institution of the appeal or any other proceeding by the tenant or within such further time as the Court may on an application made to it allow in this behalf. In the case on hand the tenant did not deposit the arrears rent either prior to filing of the suit or during its pendency before the trial Court. In the first Appellate Court rent was deposited and it was not clear whether he continued to deposit the rent as per Sub-section (1) of Section 13. the first Appellate Court set aside the findings of default on the ground that the rent was deposited in the appellate Court. The High Court was of the opinion that after the trial Court passed the decree holding that the tenant was in arrears of rent, mere depositing the amount without filing an application for extension of time for payment of all the arrears of rent due, the finding of the Appellate Court that the tenant was not a defaulter is not sustainable. The High Court further recorded that the first Appellate Court did not give any finding that entire amount of arrears of rent was paid. This finding of the High Court cannot be faulted in view of clear provision of Sub-section (1) of Section 13 and, therefore, the tenant is not entitled to get protection under Sub-section (5).
The above observation squarely applies to the case in hand where the respondent tenant has deposited the arrears of rent for the first time in the Appellate Court. The tenant has deposited the arrears of rent in the Appellate Court nearly six years after the filing of the petition, which clearly amounts to wilful default. The contention of the respondent that in view of Page 2246 the deposit of arrears of rent, in the Appellate Court the tenant is not a defaulter cannot be sustained. Subsequent deposit of rent in the Appellate Court would not make good the default already committed.
14. ADVANCE AMOUNT:
It is not in dispute that the respondent/tenant has paid an advance of Rs. 5,000 to the landlord. The main contention of the tenant is that when the excess amount is available when the landlord, that could be adjusted towards the rent and there will not be any wilful default. It is further contended that even assuming that the tenant was in arrears of rent of nine months at the time of filing the eviction petition, it would amount only to Rs. 2,475 and that could have been adjusted with the advance amount and there would not be any wilful default on the part of the tenant. In support of his contention, the learned Counsel for the tenant has relied upon [K. Narasimharao v. T.M. Nasimuddin Ahmed]. In the said decision, the High Court has observed that when the tenant has paid Rs. 3,000 to the landlord as advance, the landlord is not entitled to claim eviction of tenant on the ground of wilful default when he was having the excess amount of advance of Rs. 2,850 and held that the landlord is bound to adjust the excess amount of advance towards the rent due from the tenant and that the tenant cannot be held to be wilful defaulter in payment of rent. In the above case, the tenant has made repairs and claimed adjustment of the amount of Rs. 1,000 spent on repairs. The arrears of rent from July to November 1990, were only Rs. 750. Under that factual circumstances of the case that the tenant has made repairs and claimed adjustment of the advance of Rs. 1000, the Supreme Court has held that the landlord was bound to adjust the advance amount towards the alleged due from the tenant. The case in hand stands on different footing, since the parties are governed by the Lease Agreement.
15. There is no dispute that the respondent has become tenant pursuant to the Lease Agreement in writing. The terms of the Lease Agreement is to the effect that if there is default in payment of rent continually for a period of three months, the landlord is at liberty to adjust three months of rent and pay back the balance amount and claim vacant possession. The relevant recitals in Ex. A1 reads:
Local language deleted Having agreed so, it would be idle to contend that the landlord is having excess amount and that ought to have been adjusted with arrears of rent for nine months and claim that there is no wilful default.
16. As submitted by the learned Counsel for the petitioner/landlord, the defence is available only for adjustment of rent at the end of tenancy. In [Raminder Singh Sethi v. D. Vijayarangam], the Supreme Court has held:
4. Every tenant is obliged to pay or tender rent to the landlord within 15 days of the month to which the rent relates. The purpose of advance rent Page 2247 is to protect the landlord from the unscrupulous tenant who may run into arrears and vacate the premises and comfortably walk away with the arrears. The advance rent is available for adjustment or is liable to be refunded at the time of vacating of the premises except where the law or the contract between the parties provides to the contrary. We have already noticed that the provisions of the Act do not apply to the premises and, therefore, the landlord was not prevented by law from securing advance payment of rent by consent of the parties. It is not the case of the tenant that the contract between the parties provides for adjustment of rent no sooner it fell into arrears from out of the amount of advance rent. In short, the appellant tenant was not absolved of his obligation to pay the rent due monthly by month in spite of any amount of advance rent being available with the landlord.
The mere fact that the landlord had with him an advance amount does not mean that the tenant has not committed wilful default within the meaning of Section 10(2)(i) of the Act. The Courts below have rightly negatived the submissions made onbehalf of the tenant that in view of the advance amount there is no wilful default. Broadly looking into the matter, it is a clear case of wilful default and the order of eviction passed by the Courts below on the ground of wilful default is to be endorsed with.
17. OWN USE AND OCCUPATION:
Case of the petitioner/landlord is that he is an unemployed person and he is assisting his brother in running his provision shop and that he has decided to start a provision shop for himself. The petitioner/P.W. 1 has stated that the demised premises is in a suitable place to start a Provision Shop and that he has Rs. 15,000 in Fixed Deposit to start the shop of his own and that he has made all arrangements to start the Provision Shop. In his evidence, P.W. 1 has clearly spoken about his intention and arrangement to start provision shop. For running a grocery shop, not much business expertise is necessary and hence there is no reason to disbelieve the version of the petitioner.
18. The claim of the petitioner/landlord on own use and occupation is resisted by the tenant on three fold contentions:
(i) the amount of Rs. 15,000 which the petitioner/landlord has in the Fixed Deposit may not be sufficient for doing Maligai Shop;
(ii) the petitioner landlord has two vacant buildings and if the landlord wants to do business, he could very well run the grocery shop in those buildings;
and;
(iii) the demised premises is not suitable for running the grocery shop since it is located in the midst of schools, hardware shops and marriage hall.
The above contentions of the tenant, either cumulatively or individually, are not sufficient to discard the petitioner's claim for own use and occupation.
Page 2248
19. In his evidence, P.W. 1 has stated that in addition to the deposit of Rs. 15,000, he could mobilize further amount by raising loan. The Plaintiff is already working in the Maligai shop of his brother and has experience in running the shop. By depositing an amount of Rs. 15,000 for running the Maligai shop, the petitioner/landlord has shown his bonafide preparation. For starting a grocery shop, no elaborate preparations are required. "Carrying on business" does not mean actual carrying on business.
20. Holding that for opening the grocery business, extraordinary expertise is not required, in 2000(1) LW 559 (SC) [Raghunath G.Panhale (dead) by Lrs. v. Chaganlal Sundarji and Co.], the Supreme Court has held thus:
One cannot imagine that a landlord who is in service should first resign his job and wait for the unknown and uncertain result for a long drawn litigation. If he resigned his job, he might indeed end up in utter poverty. Joblessness is not a condition precedent for seeking to get back one's premises. For that matter assuming the landlord was in a job and had not resigned it or assuming that pending the long drawn litigation he started some other temporary water business to sustain himself, that would not be an indication that the need for establishing a grocery shop was not a bonafide or a reasonable requirement of that it was motivated or was a mere design to evict the tenant. It is not necessary for the landlord to adduce evidence that he had money in deposit in a Bank nor produce proof of funds to prove his readiness and willingness as in a suit for Specific Performance of an agreement of sale of immovable property. So far as experience is concerned, one would not think that a grocery business was one which required extraordinary expertise. It is, therefore, clear that the entire approach of both the Courts was absolutely wrong in law, and perverse on fact. Unfortunately the High Court simply dismissed the writ petition filed under Article 227 stating that the findings were one of fact. That is why we think that this is an exceptional case calling for interference under Article 136 of the Constitution of India.
21. On behalf of the tenant, it is contended that the petitioner/landlord owns other shops and that he could run the Provision Store in those shops. Drawing the attention of the Court to the evidence of P.W. 1, the learned Counsel for the respondent tenant has submitted that P.W. 1 has admitted that an adjacent shop has become vacant and that he did not occupy the said shop for running Maligai shop. But the petitioner/landlord has rented the same to third parties. Onbehalf of the landlord it is submitted that the other shops are similar in size and that he could not occupy those shops. Even if the petitioner owns other shops, when the petitioner has stated that those shops are similar in size and cannot be occupied for running the Maligai shop his version cannot be doubted. It is not for the tenant to dictate terms as where and how the Maligai shop proposed by the petitioner/landlord is to be run. In [Ragavendra Kumar v. Firm Prem Machinery & Co.] the Supreme Court has held:
Page 2249 It is true that the plaintiff landlord in his evidence stated that there were a number of other shops and houses belonging to him but he made a categorical statement that his said houses and shops were not vacant and that the suit premises is suitable for his business purpose. It is a settled position of law that the landlord is the best Judge of his requirement for residential or business purpose and he has got complete freedom in the matter. In the case in hand the Plaintiff landlord wanted eviction of the tenant from the suit premises for starting his business as it was suitable and it cannot be faulted.
The landlord has complete freedom in choosing the place. It is not open to the tenant to contend that the place which the petitioner/landlord has chosen is not suitable for running the Provision Store. As held by the Supreme Court, the landlord is the best judge of his requirement for residential or business purpose and he has got complete freedom in the matter.
22. In proper appreciation of the evidence, the Courts below have rightly ordered eviction on the ground of wilful default and the bonafide requirement for own use and occupation. When the findings of the Rent Control Appellate Authority ordering eviction are in proper appreciation of evidence and are not unreasonable or perverse, the revisional Court cannot interfere with the same. This revision petition has no merits and is bound to fail.
23. This revision is dismissed, confirming the order of the Rent Control Appellate Authority dated 17th December, 2004, made in R.C.A.No. 5/2004 on the file of the Principal Subordinate Judge, Nagercoil, confirming the order in R.C.O.P. No. 17/1999, on the file of the Rent Controller, (DMC) Nagercoil. In the circumstances of the case, there is no order as to costs.
24. Two months time is granted for vacating and handing over vacant possession.