Gopal Das vs Precious Properties Pvt. Ltd.

Nisha Gupta, J.—This appeal under Section 22 of the Rajasthan Premises (Control of Rent and Eviction) Act, 1950 (in short the Act of 1950) has been filed against the judgment and decree dated 7.12.2007 passed by Addition District Judge, (Fast Track) No. 9, Jaipur City, Jaipur in Civil Suit No. 2/2007 whereby the suit for fixation of standard rent has been decreed under Section 6 and Rs. 15,000/- has been determined as standard rent.

The short facts of the case leading to this appeal are that respondent plaintiff has instituted a suit under Section 6 of the Act of 1950 for fixation of standard rent for the premises let out to the defendant- appellant originally at the monthly rent of Rs. 75/- and from 1.2.1976 the monthly rent was enhanced to Rs. 142/- and the last rent paid was 150.88 per month. The respondent has purchased the property and attorned the tenant. The main contention of the respondent in the suit was that the property is commercial situated in prime business locality of Jaipur City at Johari Bazar. The market price of the land in that area is approximately 1 lac per Sq. Meter and it can fetch Rs. 25,000/- per month rent. The appellant has denied the contentions and submitted that agreed rent is reasonable. On the contentions of the parties, issues have been framed as under:

The plaintiff respondent examined PW/1 Rajendra Agarwal, PW/2 R.B. Shah and appellant defendant has examined himself as -DW/1, Shanker Lal -DW/2, Bhagwan Sahai -DW/3, Mohan Lal- DW/4 and Ram Chand -DW/5. Under Section 7 of the Act of 1950, the Court has determined 662/- per month as provisional rent and after conclusion of the trial, Rs. 15,000/- has been determined as standard rent, hence this appeal.

The contention of the appellant is that under Section 6 sub-clause (3) of the Act of 1950, the court below has not considered the prevailing rent of the same locality, nothing has been placed on record by the respondent that what is the prevailing rent of adjacent properties. Specific mention has been made as regards the other property adjacent to the disputed property that Ratnalay Diamond Pvt. Ltd., Mumbai is the tenant of adjacent property but no documentary evidence has been produced, hence an adverse inference be drawn against the respondent under Section 7 of the Act of 1950 Rs. 662/- has been assessed as provisional standard rent, the court below has not considered the guiding factors enumerated in Section 6 sub-clause (3) and without any basis Rs. 15,000/- has been fixed as standard rent arbitrarily. His further contention is that now new Act of Rajasthan Rent Control Act, 2001 (for short the New Act, 2001) has came into force on 1.4.2003 and as per Section 6 of the New Act, 2001 the standard rent should be determined as there is significant disparities between the calculation of rent under Section 6 of New Act, 2001 and Section 6(3) of the Act of 1950 and the law dos not provide for such anomalies. The court below has also erred in ordering the standard rent from the date of suit without assigning any reason, the appellant is paying regularly the rent determined under Section 7 of the Act of 1950. Section 6(3) of Act of 1950 does not recognize the market value of the property but only the cost of construction is the relevant consideration to assess the standard rent but the court below has wrongly assessed the standard rent on the basis of market value.

Per contra, the contention of the respondent is that all the relevant considerations under Section 6(3) of the Act of 1950 have been proved by the respondent. The appellant himself has admitted that in the locality Rs. 30 to 40,000/- rent is normal rent, the market value of the property is also a relevant consideration under Section 6(3) of the Act of 1950, valuation report gives basis and guideline to arrive at a fair rent. The court below has not assessed any magic figure but on the consideration of the evidence standard rent has been rightly determined. The conscious reading of the order goes to show that the respondent is claiming standard rent from the date of suit, he is not getting adequate and reasonable amount, hence the court below was right in making the order effective from the date of filing of the suit and there is no infirmity in the impugned judgment.

Heard the learned counsel for the parties and perused the judgment and decree under appeal as well as the original record of the case.

The first contention of the appellant is that rent should be determined as per Section 6 of the Act of 2001 but this argument of the appellant has no force as the law is settled on the point as held in Bhag Chand Vs. A.D.J. No. 5 and Others, wherein it has been held that application of proceedings for fixation of standard rent pending under Section 6 and 7 of the Old Act would be governed by Old Act of 1950 and not by New Act of 2001 and Section 32 of the Act is also implicit in this field, hence the contention of the appellant cannot be accepted and Section 6 of the New Act has no role for determination of standard rent in the present suit property. Further reliance has been placed on Kashi Ram & Ors. v. Shikhar Chand & Anr., ILR 1959 Raj. 528 where general principles as regards the determination of standard rent has been explained and it has been made clear that petitioner should mention the facts and circumstances on the basis of which the court can proceed under Section 6 sub-clause (3) of the Act. It is not in dispute that earlier Section 6 sub-clause (2) was applicable but it has been declared ultra vires. Thereafter as per Section 6(3) of the Act of 1950, the standard rent has to be assessed. There is no dispute about the law propounded in Kashi Ram (supra), but now the only option with the court below was to determine the rent under Section 6(3) of the Act of 1950.

The other contention of the appellant is that 5 considerations are relevant to determine the standard rent under Section 6(3) of the Act of 1950 which has been enumerated in the provision. The court below has assessed the rent only on the basis of valuation report but the contention of the appellant is not acceptable. The court below has considered the rival contentions and has held that appellant himself has admitted the fact that property similar to the disputed property could fetch Rs. 30 to 40,000/-. The appellant himself has admitted in his cross-examination that the property is not in bad condition, it has electricity facility. It is not in dispute that property is situated in Johari Bazar which is the prime business center in Jaipur. Furthermore, respondent has stated all these facts in his evidence and PW/2 R.B. Shah has assessed the market value of the property. It is true that only on the basis of market value, the rent could not be assessed but it can be a basis for the assessment which has been held in Bhag Chand (supra) where other relevant consideration has been explained and it has been held:

"Hence, the words ''other relevant consideration'' would mean other factors which throw light on the issue of standard/provisional rent. Such relevant consideration could be the report of a valuer, or the rate of the land fixed by the District Level Committee (the DLC rates, for short)."

Hence the report of the valuation and District Level Committee reports are also relevant consideration for assessment of standard rent. Further reliance has been placed on Gopi Chand Sardar Mal and Sons Vs. Dilip Kumar, where also it has been held that on the basis of valuation report, rent could be determined.

Learned counsel for the appellant has submitted that market value and cost of constructions are two different factors and reliance has been placed on Dr. K.C. Nambiar Vs. Rent Controller, Madras and Others, . There is no dispute about that fact that market value and cost of construction are two different mathematics but market value and valuation report could also be relevant consideration for assessing the standard rent and reliance could be placed on V.S. Kanodia Vs. A.L. Muthu (D) Thr. Lrs. and Another, .

The contention of the respondent is that there is a great disparity between the reasonable expectation of the land lord and actual rent which has been paid. If the tenant agrees to pay the prevalent market rate of the land, the number of case would not reach to the court and the court below has assessed the rent after giving due consideration to the material on record and a fair and reasonable rent has been assessed and reliance has been placed on Mohammad Ahmad and Another Vs. Atma Ram Chauhan and Others, wherein it has been held:

"One half of the lis between landlord and tenant would not reach courts, if tenant agrees to pay the present prevalent market rate of rent of the tenanted premises to the landlord. In that case landlord would also be satisfied that he is getting adequate, just and proper return on the property. But the trend in the litigation between landlord and tenant shows otherwise. Tenant is happy in paying the meagre amount of rent fixed years ago and landlord continues to find out various grounds under the Rent Acts, to evict him some how or the other. This case appears to be another classic example of the aforesaid scenario."

The contention of the respondent is that Court can take judicial notice of the fact that from the year 1976, there is many fold increase in the rate of value of the property and reliance has been placed on Rattan Arya and Others Vs. State of Tamil Nadu and Another, . The court below has rightly considered the fact that appellant himself has admitted the fact that the property is situated in the prime business locality of Jaipur and the normal rent in the area is 30-40,000/- and after considering the valuation report and other circumstances, standard rent has been assessed.

The other contention of the appellant is that standard rent has been ordered to be paid from the date of order for which no reasons have been recorded. It is not in dispute that law does not provide that any reason has to be recorded but the contention of the appellant is that judicial order should always be reasoned one and if law does not provide so, still it is implicit that order should be reasoned. There is no dispute about this legal proposition but here in the present case, the conscious reading of the order makes it implicit and it could be gathered from the order that the respondent is claiming standard rent from the date of suit. The court has assessed that the rent paid is very low after taking into consideration the relevant factors of the matter, hence the court below was justified in ordering the standard rent to be paid from the date of the order as respondent was not getting the reasonable and fair rent of the property hence looking to the totality of the facts and circumstances, no interference is needed. The appeal is liable to be dismissed.

The appeal is accordingly dismissed.