Madras High Court
K.S. Pandian vs G. Rukmani Bai And Three Others on 22 September, 2000
ORDER
1. This revision is directed against the order of eviction passed as against the revision petitioner/tenant in R.C.A.No.89 of 1991, Sub Court. Madurai, reversing the order of the Rent Controller, Madurai, in R.C.O.P.No.128 of 1984.
2. The respondents have prayed for eviction of the tenant, contending that the premises was taken on lease by the revision petitioner on a monthly rent of Rs.35. The petitioner was always irregular in payment of rent and a notice was sent on 9.12.1997 pointing out the wilful nature of the default in payment of rent. Rents were being sent by money orders. He was unable to take proceedings as he was employed out of Madurai town. Earlier, a sum of Rs.210 was sent claiming to be the rent due for the period March, 1981 to April, 1982. After the said payment, he did not pay any amount. Therefore, rents were due from April, 1982 to the end of January, 1984 namely, for a period of 22 months. A notice dated 9.1.1984 was sent terminating the tenancy which was received by the tenant on 11.1.1984. A reply dated 1.2.1984 was sent with a cheque for Rs.735 which also did not represent the correct amount due as on that date since as on that date, a sum of Rs.820 was due. A rejoinder was sent accepting the cheque under protest and also stating that balance amounts were due. The rejoinder was received by the tenant on 11.2.1984. A false reply was sent stating that the tenant had been asked to retain the rents as savings. Hence, petition for eviction.
3. In the counter, tenant contended that he was regular in payment of rent which was paid as and when the petitioner came for collection of rent. The tiled roof which requires to be replaced once in two years, was not repaired for the past 10 years. The tenant was instructed by the landlord to retain the rent as savings for the purpose of carrying out the repairs. Believing the said representation, the rent was retained with him. But the landlord had suddenly sent the notice. In fact, it was the petitioner who did not come for collection of the rents. Since notice was received, a sum of Rs.735 was sent by a cheque. There was no wilful default in the payment of rent.
4. On a consideration of the said contentions and the evidence, the Rent Controller held that there was evidence to show that the landlord was frequently going out of station and hence it was not possible for the tenant to pay the rent regularly. With the result, the petition for eviction was dismissed. The Appellate Authority did not agree with the said findings and held that the conduct of the tenant revealed that he had willfully defaulted in payment of rent and there was no basis for the contention that he was instructed to keep the rent with him for carrying out the repairs. Even when the appeal was taken up for hearing, the tenant was found to be in default of Rs. 1,025 towards rental arrears. With the result, the appeal was allowed and eviction was ordered.
5. Learned counsel for the tenant/petitioner contends" that immediately after the receipt of the notice, the entire dues have been paid and hence the R.C.O.P. was not maintainable in terms of the judgment of this Court in Ramachandran v. Krishnaraj, and Abdul Hameed v. M. Sultan Abdul Kader, 1996 (2) LW 525, AR. Lakshmanan, J. as he then was, held in the former judgment that when the tenant had sent the arrears of rent even before the receipt of summons in the eviction petition, no order of eviction could be passed. In the latter judgment, the learned Judge held that when the payment of the arrears was made on the first hearing date in the petition before the Rent Controller, there was no default in the payment of rent. Inasmuch as I felt that the statement of law as contended by learned counsel for the petitioner requires a detailed scrutiny of the provisions of the Act in the context of the decisions of this Court and the Supreme Court, and also that since in a number of Revisions before this Court, the same point was raised on the basis of the above mentioned judgments, I felt that a considered order can be passed after hearing the arguments of other counsel representing both sides in other cases also. I have heard the arguments in few other Revisions also on the same point and in this order I have taken into account all the rulings cited by both sides in those cases also.
6. In the present case, the factual basis for raising the contention that as on the date of filing the R.C.O.P., there were no arrears of rent, is actually absent. From April, 1984 to January, 1984, arrears of rent for 22 months were due. The admitted rent being Rs.35 per month Rs.770 was payable, but only Rs.735 was paid. The further relevant fact is that the landlord had already terminated the tenancy and received the payment of Rs.735 only under protest without prejudice to his rights to seek for eviction of the tenant. The contention on behalf of the tenant, that he had paid the entire arrears can be accepted only if the rent due for January, 1984 was excluded. The payment was made on 2.2.1984 and the R.C.O.P. was filed on 20.2.1984. It is only in the said background, the tenant appears to contend that there was no arrears of rent as on the date of filing the petition.
7. It is therefore, necessary to consider the correctness or otherwise of the contention that.
(a) if the entire arrears have been paid before filing the petition, or,
(b) if the arrears are paid at the first hearing of the petition then it should be held that there was no default. The contention thus raised is very startling in my opinion and is likely to have considerable impact on all the Rent Control proceedings at all levels and therefore, requires detailed analysis.
8. It is now settled by various judgments of the Supreme Court and this Court that the provisions of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960, hereinafter called "the Act"), is not intended for protecting the tenants only, but also to protect the interest of the landlords also.
9. In Manimudi v. State of Tamil Nadu, 1993 (I) MLJ 651, Srinivasan, J. as he then was, held that the contention that the provisions of the Act should protect only the tenant and no benefit shall be conferred on the landlord, was to say the least, preposterous. The expression "unreasonable eviction" as occurring in the preamble presupposes that the Act does not prevent eviction of the tenant on reasonable grounds.
10. A Bench of five Judges of the Supreme Court had occasion to consider the scope of the Tamil Nadu Act in Raval and Co. v. K.G. Ramachandran, . In the majority judgment, it was held that the scope of the Act was to be fair to the landlord as well as to the tenant. The observation in the said judgment was quoted for reliance by a Bench of three Judges in D.C. Bhatia v. Union of India, , while considering an amendment to the Delhi Rent Control Act and it was held that the object of the Act was to strike a balance between the interest of the landlords and tenants.
11. In this background, let us consider the plight of the landlord who puts in his hard earned money in a property as an investment. He is certainly justified in entertaining a legitimate expectation to receive a reasonable and fair rent regularly without default. To own a property is not a crime. Not all the so-called landlords are rich and not all the tenants are poor, especially in the context of urban properties. The property is purchased and building is put up out of hard earned money over the years in the shape of pension, savings, funds raised by loans which are repaid in instalments. There are hundreds of families who depend and live only on the rental income. To borrow the expression of the Supreme Court in the case of Raval And Co. cited above, the Rent Act did not proceed on the basis that all the tenants belonged to weaker sections of the community and that all the landlords belonged to the better off classes. The origin of the legislation was a war time compulsion during Second World War and a product of the then Defence of India Rules in order to ensure that the tenants were not subjected to unnecessary harassment and unreasonable eviction. Now we are in a generation where even the feudal landlords have become fragmented and are now on level with any citizen who is prepared to work hard and earn. Therefore, the legislation should be viewed not only as a welfare measure to ensure that there is no unreasonable eviction of the tenant, but also to protect the landlords from dishonest tenants who high handedly and wilfully default in payment of rent, or cause damage to the property or sub-let the property to the detriment of the landlord and also to allow the landlord to take possession when the bona fide requires the property for personal use. Such a guarantee to the landlord is engrafted in the statute itself. Any interpretation of the provisions of the Act as if they are intended only for the benefit of the tenant irrespective of his deliberate and wilful defaults and mistakes causing loss to the landlord would be inconsistent with the provisions of the statute as well as the law laid down by the Supreme Court.
12. As far as wilful default as a ground for eviction, Section 10(2)(i) and proviso and the explanation appended to the said Section are relevant and extracted below:-
"10(2) A landlord who seeks to evict his tenant shall apply to the Controller for a direction in that behalf. If the Controller, after giving the tenant a reasonable opportunity of showing cause against the application, is satisfied-
(i)that the tenant has not paid or tendered the rent due by him in respect of the building, within fifteen days after the expiry of the time fixed in the agreement of tenancy with his landlord or in the absence of any such agreement, by the last day of the month next following that for which the rent is payable, or .......
Provided that in any case falling under clause (i) if the Controller is satisfied that the tenant's default to pay or tender rent was not wilful, he may, notwithstanding anything contained in section 11, give the tenant a reasonable time, not exceeding fifteen days, to pay or tender the rent due by him to the landlord up to the date of such payment or tender and on such payment or tender, the application shall be rejected.
[Explanation. -- For the purpose of this sub-section, default to pay or tender rent shall be construed as wilful, if the default by the tenant in the payment or tender of rent continues after the issue of two months' notice by the landlord claiming the rent.]"
13. One other provision which is also relevant is Section 8(2) of the Act which requires the tenant to take steps to deposit the rent either in a Bank or before the Rent Controller in the event of the landlord refusing to receive (or) evades to receive the rent and Section 9 of the Act as regards steps to be taken by the tenant when either the address of the landlord is not known or there is bona fide doubt or dispute as to the person entitled to receive the rent.
14. If the tenant commits a default in payment of rent and such a default is wilful, the landlord is entitled to terminate the tenancy, and seek for eviction on the ground of wilful default. The landlord is not required to give an opportunity to the tenant to pay. The Explanation to sub-section which was inserted in the year 1973, is only an enabling provision, giving a choice to the landlord to issue notice to the tenant for paying the defaulted rent within a period of two months. The landlord is not under a duty to give such a notice. In the event of such a notice being given, the tenant is given an opportunity to pay the arrears within a period, failing which the default becomes conclusive. The consequences of issuing a notice under the Explanation, affects and benefits both the landlord and the tenant to a definite extent. It affects the landlord restricting his rights to complain default of the past rents and in the event of the tenant paying the arrears within the stipulated time, the landlord looses his right to sue for eviction. But the benefit is that in the event of the tenant not paying the arrears, the wilful nature of the default becomes conclusive. The benefit conferred on the tenant is that his past conduct of being in arrears is erased and he is given an opportunity to pay the arrears. The disadvantage is that his failure to pay the arrears would raise a presumption of wilful default. But for such a choice given to the landlord to issue notice under the Explanation, there is no restriction on him to directly seek for eviction for wilful default on the part of the tenant.
15. The effect of the Explanation was considered by the Supreme Court in Sundaram Pillai, S. v. V.R. Pattabiraman, 1985 (98) LW 49. After examining all the provisions as well as the prior decisions, the Supreme Court held as follows:-
"(1) Where no notice is given by the landlord on in terms of the Explanation, the Controller, having regard to the four conditions spell out by us has the undoubted discretion to examine the question as to whether or not the default committed by the tenant is wilful. If he feels that any of the conditions mentioned by us is lacking or that the default was due to some unforeseen circumstances, he may give the tenant a chance of locus penitentiae by giving a reasonable time, which the statute put at 15 days, and if within that time the tenant pays the rent, the application for ejectment would have to be rejected.
(2) If the landlord chooses to give two months' notice to the tenant to clear up the dues and the tenant does not pay the dues within the stipulated time of the notice then the Controller, would have no discretion to decide the question of wilful default because such a conduct of the tenant would itself be presumed to be wilful default unless he shows that he was prevented by sufficient cause or circumstances beyond his control in honoring the notice sent by the landlord.
16. The Supreme Court also approved the view of Ratnam, J. as he then was, in N. Ramaswamy v. S.N. Periamuthu, 1980 (93) LW 577, holding that if the landlord without issuing notice under the Explanation files a petition for eviction on the ground of wilful default then in the absence of proper explanation by the tenant, the default should be construed as wilful in spite of the fact that no notice had been issued by the landlord claiming arrears of rent.
17. Much of the confusion surrounding the so-called right of the tenant to pay the arrears of rent before filing of the eviction petition would be removed on an analysis of the judgment of the Supreme Court in Sundaram Pillai's case, 1985 (98) LW 49 cited above. When once the tenant is in default, and the landlord terminates the tenancy or chooses to file the eviction petition, there is no provision in the Act, which would enable the tenant to pay the arrears either before filing of the petition, or immediately after receiving the notice from the Rent Controller, so as to raise a presumption that there is no wilful default. Much less, is there any justification for holding that if on the first hearing date the rent is paid, the eviction petition should be thrown out. To hold otherwise, in my respectful opinion, would result in rendering the ground of wilful default a mockery. If such is the law, then it is open to the tenant to happily and deliberately continue his wilful default repeatedly and for any length of period and conveniently wait for the notice of eviction or notice from the Rent Controller on the petition for eviction, whereupon he would condescend to pay the rent immediately before the petition or on the first hearing of the petition and his past conduct of wilful default would be erased. He will be free to do this again and again and there is no way of evicting any chronic defaulter. In my understanding of the provisions of the Act or the law declared by the Supreme Court, such a conclusion is not warranted.
18. It is true that if before the filing of the eviction petition, the tenant had paid the entire arrears and the landlord had accepted the same without any protest and consequently, there are no arrears as on the date of the filing of the petition, then there would be no default. But if after issuing a notice of termination and for eviction and either the landlord receives the rent under protest or refuses to receive the rent, he would be entitled to proceed with the petition for eviction. It is the inherent right of the landlord to receive the arrears of rent whenever tendered and such acceptance alone cannot result in holding that there was no wilful default by the tenant. But the landlord is obliged to register his protest and should accept the rent only without prejudice to his rights to proceed further in accordance with law. If he simply accepts the rent without any demur and eventually there are no arrears of rent as on the date of filing of the petition, then undoubtedly the petition for eviction cannot be maintained. The circumstances under which the rent is accepted by the landlord is very much relevant. Acceptance of rent after the filing of the eviction petition cannot cause any prejudice to the right of the landlord to continue the eviction proceedings. But if acceptance of the rent is before the filing of eviction petition, if the landlord had accepted the rent under protest he is entitled to proceed further with the eviction petition. If he accepts the rent without any protest prior to the filing of the petition and if consequently there are no arrears of rent as on the date of filing the eviction petition, such a petition for eviction would be liable for dismissal.
19. In Rajeswari v. Vasumai Lalchand, , Mohan, J. as he then was, held that acceptance of the rental amount after the filing of the petition for eviction will not relieve the tenant of the earlier charge of wilful default.
20. In Emberumanar v. Raghava, 1984 (II) MLJ 383, Ratnam, J. as he then was, held that payments made by the tenants and accepted by the landlord without prejudice to evict the tenant for wilful default, cannot preclude the landlord from taking action for the default.
21. The situation would be different if the landlord issues a notice under the Explanation, in which case if any amount is paid within the period of two months, the landlord is bound to accept the rent and there cannot be a complaint of wilful default nor can the landlord proceed for eviction.
22. Now we may consider the subsequent judgments of the Supreme Court after Sundaram Pillai's case, 1985 (98) LW 49 and very much relied on the side of the tenants and see whether the said judgments warrant any contrary conclusion.
23. The circumstance of the tenant having paid the rent within one month after filing of the petition which was accepted by the Supreme Court in favour of the tenant in Krishna Mudaliar, V. v. Lakshmi Ammal, 1996 (II) LW 467 is based totally on the peculiar circumstances of the case, namely, the tenant who was regular in payment of rent was dragged by the subsequent purchaser - owner of the property, before the Civil Court by alleging that the tenant was a trespasser. After the Civil Court proceedings ended in favour of the tenant, the eviction proceedings were filed by the landlord. The Supreme Court while deciding in favour of the tenant held that the Courts below have not taken into account the peculiar circumstances of the case and held as follows:-
"We are of the view that the Courts below have not taken into consideration these facts in the right perspective. Keeping in view the peculiar facts and circumstances of this case, we hold that the default in the payment of rent on the part of the appellant was not wilful. Admittedly the appellant had deposited the rent in the Court of the Rent Controller within one month of the institution of the application."(Italics supplied).
24. From the above observations, I am unable to read any declaration of law to the effect that if the arrears are paid within a short time after the filing of the application, then there would be no default.
25. Dakaya v. Anjani, on which strong reliance is placed on behalf of the tenant, is a case where the landlord sent a notice claiming payment of rent on 8.12.1988. On 7.12.1988 itself part of the due amount was paid and accepted by the landlord. On 12.12.1998 even before the filing of the petition for eviction a bank draft was sent for the balance amount which was not accepted by the landlady. The cheque was therefore subsequently deposited before the Rent Controller. The eviction petition was filed only on 19.12.1988. It is only in those circumstances, the Supreme Court held that as on the date of filing the eviction petition, there was no arrears and hence there was no question of any default. This is a case of notice demanding payment under the Explanation and as such the landlord certainly had no business to refuse to accept the payment of rent and thereafter file the eviction petition. Therefore, the said decision can have no relevance to the situation of a landlord filing a petition for eviction after default has been committed and without calling upon the tenant to pay the arrears. To hold otherwise, would be contrary to the views of the Supreme Court in Sundaram Pillai's case, cited supra.
26. In J. Jermons, J. v. Alimmal, , the Supreme Court dealt with a case where there was a prohibitory order by the Income-tax Department and the tenant pleaded that out of ignorance and compulsion of circumstances beyond his control, the rent was not paid. This explanation was accepted by the Supreme Court. This is a case where the decision related to the finding as to whether the default was wilful or not. The said decision is therefore, not relevant to decide the issue on hand.
27. The decision rendered in Chordia Automobiles v. S. Moosa, is also a case on the issue as to whether the conduct of the tenant could be termed as wilful or not. It was a case where the tenant pleaded that the failure on the part of the tenant to pay the rent was on account of the agent of the landlord not coming to collect the rent for some period. The Supreme Court held that the past conduct of the landlord and tenant cumulatively would show that the tenant cannot be said to have committed wilful default. Therefore, this decision also is not relevant for the issue under discussion.
28. The ruling in C. Chandra Mohan v. Sengottian, is a decision in contrast. The attempt on the part of the tenant to deposit the rent under Section 8(5) of the Act was held to be not a valid payment or tender of rent to the tenant. But on the facts of the case, it was found that the landlord had withdrawn the deposited amount even before filing of the eviction petition. Therefore, on facts, it was held that there was no subsisting claim of arrears of rent on the date when the application for eviction was filed.
29. The above decision also implies that mere offer or deposit of rent alone will not absolve the tenant of the consequences of his past wilful default, if once the landlord had terminated the tenancy and had proceeded to file the eviction petition. If the landlord chooses to receive the rent before filing of the petition, and without protest, then alone the petition filed subsequently, is liable to be rejected.
30. Now I would deal with certain other rulings referred to by both sides.
31. In Rajeswari v. Vasumai Lalchand, , Mohan, J. as he then was, held that tender of rent by the tenant after the application for eviction had been filed, will not relieve the tenant of the earlier charge of wilful default.
32. In Kulsumbai Mulla Jeewajee v. Madras Marine P. Ltd., 1984 (I) MLJ 399, Fakkir Mohammed, J. held that the fact that the landlord once condoned the lumpsum payment for three months, cannot justify the subsequent failure to pay the rent regularly.
33. In Mukta Bai v. Adinarayana Chetty, 1989 (I) MLJ 502, S. Sivasubramaniam, J. held that the fact that the tenant deposited the arrears of rent after the eviction petition was filed cannot come to his rescue, since the petition was filed on the cause of action based on wilful default. Therefore, by the subsequent deposit of rent, the landlord cannot be non-suited on that ground. The learned Judge further held that if such a view was taken then the very purpose of the provision in the Act for eviction of tenants on the grounds of wilful default would be defeated and that the tenants are entitled to protection under the Act only as long as they perform their obligations as tenants.
34. In Thayammal v. Subramaniam, 1989 (I) MLJ 407, Srinivasan, J. as he then was, held that the mere fact that the tenant sent the entire arrears on receipt of notice, will not entitle him to plead that there was no wilful default.
35. In Deluxe Road Lines v. Palani Chetty, 1992 (II) MLJ 481, Srinivasan, J. as he then was held that it was not necessary in every case a notice should be given to the landlord under the Explanation to Section 10(2) of the Act in order to hold that the default was wilful. Even in cases where no notice had been issued, the default could still be held to be wilful.
36. In 1994 (I) MLJ 516, S.M. Ali Mohamed, J. dealt with a case where the landlord filed a petition for eviction after having issued a notice demanding arrears of rent and even before lapse of two months period. The learned Judge rightly held that the landlord cannot seek the benefit of presumption of wilful default. This decision is not helpful to resolve the contentions raised on behalf of the tenant in the present context.
37. The judgment of AR. Lakshmanan, J. in Kandaswamy Pathar v. Meenakshi Bai, 1996 (II) MLJ 430 is consistent with the outcome of the discussion above. In that case, a notice of eviction was sent on 31.1.1984 on the ground of default. The tenant paid the entire arrears on 6.4.1984 which had been received by the landlord. The eviction petition was filed only on 9.4.1984. It was therefore, rightly held that as on the date of filing of the petition there was no default.
38. In Abdul Hameed v. M. Sultan Abdul Kader, 1996 (2) LW 525, though the learned Judge had incidentally pointed out that the tenant had deposited the entire arrears at the very first instance before the Rent Controller, the learned Judge had taken into account the "peculiar circumstances of the case" whereunder it was seen that the landlord was always in the habit of receiving lumpsum of amounts for accumulated period. In those circumstances it was held that there was no wilful default.
39. In Ramachandran v. Krishnaraj, the learned Judge held that there was no wilful default in payment of rent. The eviction petition was filed on 12.3.1990 and the tenant had sent the rent by Money Order on 12.4.1990 which is alleged to be even before the receipt of the notice in the eviction petition.
40. In Jabar v. Abdul Bari, 1997 (II) MLJ 181, the learned Judge dealt with a case where eviction petition was filed on 30.7.1985 and the tenant claimed that he had paid the entire arrears before the date of first hearing of the petition. It was held that there was no default and that the tenant cannot be evicted.
41. With due respect I am unable to share the view of the learned Judge in view of the reasons stated above, especially in the context of the judgment of the Supreme Court in Sundaram Pillai's case, 1985 (98) LW 49.
42. Reliance was placed on the judgment of R. Balasubramanian, J. in Subbiah, S.M. v. S. Nadappan, . The said judgment also does not help the tenants in any manner. That is a case in which the landlord appears to have admitted in the evidence that the tenant had paid the entire arrears even before the filing of the petition which the landlord had accepted any demur. In that background, it was rightly held that there was no default.
43. Being faced with the very same contentions as raised before me, K. Govindarajan, J. held that accepting the contention that there was no wilful default if the tenant had deposited the entire rent on the first date of hearing, would amount to rewriting the provisions of the Tamil Nadu Buildings (Lease and Rent Control) Act, vide Easwara Rao, T. v. N.W. Ansari, . I am in respectful agreement with him.
44. Therefore, on the issues raised before me, the following are my conclusions :-
(a) There is no compulsion on the landlord to issue a notice demanding arrears of rent as provided under the Explanation. He can directly file a petition for eviction on the ground of wilful default and substantiate that the default was wilful.
(b) If notice is issued under the Explanation, then the landlord impliedly waives the past conduct of the default and has to wait till the end of two months period and if the tenant does not pay even after the said notice, a rebuttable presumption of wilful default would arise. If the entire arrears are paid within the period, the landlord cannot seek to evict the tenant.
(c) If after issuing notice of termination and eviction, and before filing of the petition, the tenant pays the entire arrears, the choice is left to the landlord either to accept the rent under protest or not to accept the rent. In either case the landlord is entitled to proceed further to file the petition for eviction. But if he accepts the rent without any demur and if the resultant position is that there are no arrears of rent as on the date of the eviction petition, the eviction petition would be liable to be dismissed.
(d) When once the eviction petition had been filed, there is no question of landlord losing his right to pursue the same notwithstanding the fact whether the tenant had deposited or was willing to deposit the arrears of rent at the first hearing of the petition.
45. Therefore, I am unable to accept the contentions to the contrary as raised on behalf of the tenant in the above revision petition as well as few other revision petitions in which I have heard the very same arguments, which I would be disposing of on the merits of each case and in the light of above conclusions.
46. In the present case, as I had already stated while referring to the facts of the case, even leaving aside the legal issue as discussed above, on facts it is found that as on the date of the filing of the petition, the tenant was in arrears of rent for at least for one month. Even otherwise inasmuch as the last payment of Rs.735 was received by the landlord under protest, the landlord does not lose his right to proceed with the eviction petition and to substantiate that the default of the tenant was wilful. This is a typical case where the landlord is taken for a ride by a chronic defaulter who would not pay the rent for 22 months as on the date of the eviction petition and then would seek to prevent the landlord from evicting him by sending the entire arrears on receipt of a notice for eviction. As the Appellate Authority had pointed out, even at the stage of the appeal, he had not paid the rent for 2 1/2 years, after the filing of the eviction petition. Certainly the provisions of the Act do not contemplate such conduct on the part of the tenant under the pretext of being a beneficial legislation.
47. In the result, there are no merits in the above revision petition and the same is dismissed with costs.