Abnash Chander and Another vs Mulakh Raj (Died) through his LR and Another

V.K. Jhanji, J.—This shall dispose of Civil Revisions No. 1006 to 1009 of 1981 preferred by the tenants. All these revision petitions were earlier allowed by me vide judgment dated 20,5.1992. Against the said judgment, landlord filed SLP in the Supreme Court. Special Leave was granted and vide judgment dated 15.10.''993, the matter has been remanded to this Court for deciding the same afresh. This is how the revision petitions have been put up before me for disposal.

The premises known as ''Air Lines Hotel and Restaurant'' - a three storeyed building - situated in Pathankot, is on rent with the tenant at the rate of Rs. 1600/- per month and the tenancy starts from 28th of each month. The revision petitions arise out of four eviction applications filed by the landlord for the eviction of his tenant. The first eviction application No. 28 of 1975 was filed on 12.6.1975 on the ground of non-payment of rent with effect from 28.1.1975 to 28.5.1975. In the eviction application, house-tax was also claimed and was stated to be part of the rent. In this application, tenant was proceeded against ex-parte on 13.9.1975 and the case was adjourned to 23.10.1975 for ex-parte evidence. Before the ex-parte evidence could be led or eviction order could be passed, tenant filed an application on 1.10.1975 for setting aside the ex-parte proceedings. On 6.10.1975, ex-parte proceedings were set aside subject to payment of Rs. 15/- as costs. On 8.10.1975, costs of Rs. 15/- were paid and the case was adjourned to 23.10.1975. On 23.10.1975, Rent Controller assessed the costs of eviction application. On costs having been assessed, tenant tendered the arrears of rent together with interest and costs of the eviction application. On 10.11.1975, Rent Controller framed the issues, whereafter the parties led evidence in support of their claim. Rent Controller ordered the eviction of the tenant on the ground that the tender made by him on 23.10.1975 was invalid inasmuch as the tenant was required to tender the arrears of rent together with costs and interest on 6.10.1975, on which date ex-parte proceedings were set aside. In appeal by the tenant, the appellate Authority vide its judgment dated 2.3.1989 affirmed the judgment of the Rent Controller. In eviction applications No. 67 of 1975, 32 of 1976 and 60 of 1976, rent for the periods, 28.5.1975 to 27.11.1975, 28.10.1975 to 27.5.1976 and 28.3.1976 to 27.10.1976 respectively was claimed. In all these three eviction applications, not only rent was claimed at the rate of Rs. 1600/- per month, but house-tax was also claimed. In these three eviction applications, initially ex-parte proceedings were taken against the tenant, but subsequently, on applications filed by the tenant for setting aside ex-parte proceedings, the same were set aside on 20.2.1976, 21.9.1976 and 27.1.1977. Tenant, on the dates the ex-parte proceedings were set aside, tendered the arrears of rent together with interest and costs assessed by the Rent Controller. Tenant however, did not tender the house-tax in eviction applications No. 67 of 1995 and 32 of 1976. In eviction application No. 60 of 1976, tenant tendered the house-tax with effect from 15.6.1976. Rent Controller as well as the appellate Authority ordered eviction of the tenant in the afore-mentioned three eviction applications on the ground that the tenant has failed to tender/pay house-tax on the first date of hearing. Hence, the four revision petitions by the tenants.

Mr. H.L. Sibal, Sr. Advocate, counsel for the tenant, has contended that the Authorities below have not appreciated correctly the legal position in regard to ''first date of hearing''. He contended that the first date of hearing in the case would be the date when the Rent Controller applied its mind to the points in controversy between the parties and not the date on which ex-parte proceedings were set aside. He also contended that in the first eviction application, Rent Controller assessed the costs of the eviction application on 23.10.1975 and on that very day, arrears of rent together with interest and costs were tendered and paid to the landlord and therefore, the Authorities below have acted illegally in exercise of their jurisdiction in holding that 6.10.1975 (the day when ex-parte proceedings were set aside) was the ''first date of hearing''. He further contended that the Authorities below are not right far saying that the rent tendered by the tenant in the first three applications was short as house-tax demanded by the landlord had not been paid. He contended that the landlord sent telegraphic notice to the tenant only on 15.6.1976 exercising his right for increase in rent to the extent of house-tax paid to the Municipal Authorities and the tenant having paid the house-tax with effect from 15.6.1976, no order of eviction could have been passed against him. On the other hand, Mr. H.S. Gill, Sr. Advocate, counsel for the landlord, submitted that the ''first date of hearing'' in the case would be the date when ex-parte proceedings were set aside. In this context, he cited judgments in Vinod Kumar v. Harbans Singh Azad (1977)79 P.L.R. 144, Ram Sarup Ashok Kumar v. Smt. Inderjit Kaur 1980(2) R.L.R. 231, Kulraj Singh Paul v. Ranjit Kaur and Anr. 1980(2) R.L.R. 317 and Wazir Chand Khanna v. Rakha Ram Aggarwal 1981 (1) R.L.R. 406. He also contended that the landlord in his eviction applications specifically claimed house-tax and that having not been paid in the first three eviction applications, tenant has rightly been ordered to be evicted by the Authorities under the Act.

I have heard the learned counsel for the parties at length.

Clause (i) of Sub-section (2) of Section 13 of the East Punjab Urban Rent Restriction Act (hereinafter referred to as the Act) states that a tenant will be liable to be evicted if he has not paid or tendered the rent due in respect of a building within fifteen days after the expiry of the time fixed in the agreement of tenancy or, in the absence of such agreement, by the last date of the month next following that for which the rent is payable. A proviso has been added to this clause providing that a tenant can save himself from eviction on the ground of non-payment of rent if he, on the first date of hearing of the application for ejectment, pays or tenders the arrears of rent and interest @ 6 per cent per annum on such arrears together with costs of the application for eviction assessed by the Controller. The object of the proviso is to give an opportunity to the tenant to stay in the premises irrespective of his default, if the tenant on the first hearing pays the rent due, or to use the language of the proviso, tenders the arrears of rent. As to what would be the first date of hearing, was considered by the Apex Court in Sham Lal (Dead) by L.Rs. v. Atma Nand Jain Sabha (Regd.) Dal Bazar (1987)91 P.L.R. 1 (S.C.), Siraj Ahmad Siddiqui Vs. Shri Prem Nath Kapoor, and Advaita Nand Vs. Judge, Small Cause Court, Meerut and Others, . In Sham Lal''s case (supra), proviso to clause (i) of Sub-section (2) of Section 13 of the Act was under consideration, whereas in Suraj Ahmad Siddiqui''s and Advaita Nand''s case (supra), the provision of U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972, were under consideration. Their Lordships of the Supreme Court in all these three judgments have held that the first date of hearing means the date on which mind is applied by the Court to determine the case and not the day fixed for return of the summons. Their Lordships observed that the day when the Court applies its mind to the case, would be the time when either issues are determined or evidence taken. It is not in dispute that in the present case, in the first eviction application arrears of rent with interest and costs were tendered before issues were framed and in the other three eviction applications, arrears of rent together with interest and costs were tendered on the date the ex-parte proceedings were set aside, i.e. before the issues had been framed by the Rent Controller. Thus, the tender having been made by the tenant before the settlement of issues in all the four eviction applications, the tenant would be deemed to have paid the rent in terms of the proviso to clause (i) of Sub-section (2) of Section 13 and therefore, the order of eviction against the tenant on the ground of non-payment of rent is wholly unsustainable. It is true that in the judgments cited by the counsel for the landlord, this Court had taken a view that in cases where ex-parte eviction order or ex-parte proceedings are set aside, the first date of hearing would be the date on which ex-parte eviction order or ex-parte proceedings are set aside. This Court had also held that if the arrears of rent, interest and costs are not paid or tendered on that date, the tenant would be liable for eviction on the ground of non-payment of rent. However, in my view, these judgments are of no help to the landlord as the same do not lay down a good law as the concept of first date of hearing has undergone a change after the decisions given by the Supreme Court in Sham Lal''s, Suraj Ahmad Siddiqui''s and Advaita Nand''s cases (supra).

In order to appreciate the second contention of counsel for the tenant that the tenant was liable to pay house-tax only with effect from 15.6.1976 when telegraphic notice was sent to the tenant by the landlord for increase in rent to the extent of amount of house-tax, it is necessary to notice the relevant provision providing for increase in rent on account of levy of house-tax. Section 9 reads as under:-

"9. Increase of rent on account of payment of rates etc., of local authority but rent not to be increased on account of payment of other taxes etc.

(1) Notwithstanding anything contained in any other provision of this Act, a landlord shall be entitled to increase the rent of a building or rented land if after the commencement of this Act a fresh rate, cess of tax is levied in respect of the building or rented land by any local authority, or if there is an increase in the amount of such a rate, cess or tax being levied at the commencement of the Act:

Provided that the increase in rent shall not exceed the amount of any such rate, cess or tax or the amount of the increase in such rate, cess or tax, as the case may be.

(2) Notwithstanding anything contained in any law for the time being in force or any contract, no landlord shall recover from his tenant the amount of any tax or any portion there of in respect of any building or rented land occupied by such tenant by any increase in the amount of the rent payable or otherwise, save as provided in Sub-section (1)."

Section 9 confers a right on the landlord to increase the rent of a building let out by him in case of an increase in the amount of such a rate, cess or tax levied by a local authority or where a fresh rate, cess or tax is levied after the commencement of the Act. It is also clear from a reading of this section that it does not make the payment of house-tax, a liability of the tenant. It merely permits a lawful increase in the rent payable by the tenant if the landlord wishes to effect an increase. The operation of Sub-section (1) of Section 9 is not automatic. It is merely an enabling provision and entitles the landlord to increase the rent of the premises covered by the Act if the rent, cess or tax in respect of the building is levied after the commencement of the Act. In Smt. Kirpal Kaur v. Bhagwant Kaur (1969)71 P.L.R. 238, Hon''ble Chief Justice Mehar Singh (as he then was) while interpreting the scope of Section 9 held that:

"On the levy of house-tax, a landlord is entitled to increase in the rent to the amount of house-tax. There is no provision for applying to the Rent Controller to increase the rent. It is only when the landlord takes a step to increase the rent that the rent becomes increased to the amount of the house-tax. He must demand the increased rent by serving a notice of demand on the tenant. Unless a landlord moves u/s 9 of the East Punjab Urban Rent Restriction Act to exercise his right to increase the rent to the extent of the levy of the amount of the house-tax, there is no automatic increase of the rent immediately as the house-tax is levied. It is to be landlord''s own act in exercising his right under the provisions of the section which increase the rent and the enhanced rent commences from the date of the notice of demand and not earlier."

Reference in this regard be also made to judgments of this Court in Puran Chand v. Mangal (1969)71 P.L.R. 571, and Baldev Kishan v. Bir Bhan and Anr. (1970)72 P.L.R. 354. In the present case, it is not in dispute that the tenant had never paid any house-tax to the landlord for a number of years, rather the landlord had been accepting the rent without house-tax continuously during that period. Landlord never exercised his right under Sub-section (1) of Section 9 calling upon the tenant to increase the rent on account of levy of house-tax. It was only on 15.6.1976 that a telegraphic notice was sent to the tenant demanding payment of the amount which landlord claimed to be due on account of house-tax. It is also not in dispute that in the fourth eviction application, house-tax with effect from 15.6.1976 together with arrears of rent, interest and costs was paid before settlement of issues. Since there was no notice to the tenant by the landlord before 15.6.1976 to increase the rent by reason of imposition of house-tax, the tenant was under no legal obligation to pay the house-tax in the first three eviction applications as these had been filed before 15.6.1976, i.e. before the telegraphic notice had been served on the tenant. The fourth eviction application came to be filed after 15.6.1976 and in this eviction application, tenant did tender the house-tax along with arrears of rent, interest and costs and on tendering of the same, tenant saved himself from eviction and thus, there had been complete compliance of proviso to clause (i) of Sub-section (2) of Section 13 of the Act. Consequently, the eviction orders passed against the tenant in all the four eviction applications are not sustainable in law and have to be set aside.

Resultantly, the revision petitions are allowed and the eviction orders passed by the Authorities below set aside. As a consequence thereof, the eviction applications filed by the landlord shall stand dismissed. No costs.