Khushi Ram vs Shanti Rani and Others

Dulat, J.—These are two petitions u/s 15(5) of the East Punjab Urban Rent Restriction Act (Civil Revision 608 of 1963 and Civil Revision 750 of 1962) and although the facts are different, the question of law arising on the facts is the same in both the cases and they can be conveniently disposed of together

In Khushi Ram v. Shanti Rani and others (Civil Revision 608 of 1963) the landlords filed an application for the eviction of the tenant Khushi Ram, and the main ground was non-payment of rent. The Rent Controller found that the rent was Rs. 30/- per month and it had been paid up to the 6th August, 1961, and that in respect of the subsequent period, that is, from the 7th August, 1931 till the date of the application which was filed on the 31st January 1962, a sum of Rs. 150/- had been deposited by the tenant in the Court of the Senior Subordinate Judge in accordance with section 31 of the Punjab Relief of Indebtedness Act, 1934, and that payment covered the rent payable at that time. The prayer for eviction was, therefore, refused and the application dismissed. On appeal, however, the Appellate Authority held that the deposit of Rs. 150/- under the Punjab Relief of Indebtedness Act did not in law amount to a payment of rent to the landlords, nor did it amount to a valid tender of that rent and, therefore, held that arrears of rent had not been paid or tendered in time, and on this finding the Appellate Authority allowed the appeal and ordered the tenant''s eviction leaving the parties to their own costs. The tenant, Khushi Ram, has now filed the present revision petition.

In the second case, Shri Vidya Prachar Trust v. Basant Ram (Civil Revision 750 of 1962), the application for the tenant''s eviction was made again on the ground of non-payment of rent, the application being filed on the 14th June. 1961. It was found that on the 23rd December 1959 the tenant had deposited a sum of Rs. 300/- in Court in accordance with section 31 of the Punjab Relief of Indebtedness Act as rent for the period, 1st October 1959 to the 30th September, 1960, and then again a sum of Rs. 292/8/- was deposited u/s 31 of the Punjab Relief of Indebtedness Act on the 18th July 1960 in respect of the period, 1st October, 1960 to the 30th June, 1981. Further it was found that after the application for eviction was filed, another sum of money, being Rs. 25/-, as costs of the petition and Rs. 7/- as interest were paid on the first date of heading. The Rent Controller held that the deposits made u/s 31 of the Punjab Relief of Indebtedness Act amounted to valid payment or tender of rent and that it could not, therefore, be said that the tenant was in arrears. In the result, the application for eviction was rejected the landlords appealed but the Appellate Authority accepted the view of the Rent Controller and dismissed the appeal. Hence Civil Revision 750 of 1962 on behalf of the landlords.

The main argument in both the cases is that a deposit made u/s 31 of the Punjab Relief of Indebtedness Act is not payment of rent to the landlord, nor does it amount to a tender of that rent. A decision by a learned Single Judge of this Court Sat Pal v. Mathoo Ram (Civil Revision 357 of 1962); which has been mentioned by the Appellate Authority in Khushi Ram''s case (Civil Revision 008 of 1963), supports that view, but all counsel agree before us that that view was not accepted by a Division Bench of this Court in Mam Chand v. Chhotu Ram and others (1964) 66 P. L. R. 93, where it was held that a deposit made by a tenant in accordance with section 31 of the Punjab Relief of Indebtedness Act was sufficient compliance with the terms of section 13(2) of the East Punjab Urban Rent Restriction Act. It is suggested on behalf of the landlords in both the cases before us that the view of the Division Bench is not sound and requires reconsideration. Section 31 of the Punjab Relief of Indebtedness Act says this -

(1) Any person who owes money may at any time deposit in Court a sum of money in full or part payment to his creditor.

(2) The Court on receipt of such deposit shall give notice thereof to the creditor and shall, on his application, pay the sum to him.

(3) From the date of such deposit interest shall cease to run on the sum so deposited.

In Mam Chand v. Chhotu Ram and others, Grover J., delivering the judgment of the Bench and disapproving the view of the learned Single Judge in Sat Pal v. Mathoo Ram, observed-

The money deposited in these circumstances simply remains in the custody of the Court for payment to the creditor who can claim it at any time and who must be paid that amount without any hindrance or obstruction by the other party. In this manner the Court must be regarded as a statutory agent of the creditor so far as the amount deposited is concerned.

Later on, he had occasion to say -

It cannot be said in the present case that there is any express authority on the part of the creditor given to the Court to accept payment on his behalf when an amount is deposited u/s 31 of the Punjab Relief of Indebtedness Act. But the question at once arises whether it cannot be legitimately said that the statute itself creates an implied agency in the sense that once the payment is made into Court it is deemed to be a payment to the creditor. The language of section 31 itself is clear that the person who owes money can deposit the same in Court in full or part payment to his creditor. This means that deposit in Court is tantamount to payment having been made to the creditor.

The submission made to us is that an agent acts by virtue of an authority given to him by his principal and since no authority is given by a landlord to any Court to recover rent for himself, it is wholly wrong to say that the Court receiving a deposit u/s 31 of the Punjab Relief of Indebtedness Act becomes the agent of the landlord. This argument leads nowhere and merely seeks to find fault with the use of the expression agent in the Division Bench case. It is clear, however, that Grover, J., when making the above observations, was merely trying to explain a situation of fact in terms of a familiar concept, the real point of the decision being that since the law authorizes a debtor to pay into Court any money due from him to a creditor, the intention and the purpose is that such payment is to be equivalent to payment to the creditor. This is made clear by the consequence mentioned in the statute regarding stoppage of further interest.

It is then urged that it is wholly wrong to say that money, which may not have been received by the creditor, is to be deemed to have been received by him. I can in principle see no objection to such a conclusion of law but, leaving that alone, it is clear that if such deposit is not to be equivalent to actual payment to the creditor, it is certainly good and valid tender of the money, for it has been paid into Court and the creditor has been told through Court that the money has been deposited and can be received by the creditor at any time. In my opinion, therefore, there is no occasion for further consideration of the decision of the Division Bench in Mam Chana''s case, which, if 1 may say so, adopts a perfectly reasonable and matter-of-fact view of the situation. I would therefore hold that a deposit made u/s 31 of the Punjab Relief of Indebtedness Act in respect of any arrears of rent must be taken in law to be at least a valid tender of such arrears. In both these cases, therefore, it is impossible to ignore the fact of the deposit. This disposes of the main question.

In Khushi Ram v. Shanti Rani and others, it is said that even the deposit made did not cover the entire amount due, the argument being that, when the sum of Rs. 150/- was paid into Court on the 24th January 1962, rent for several months had become overdue and for the period exceeding the statutory time fixed for payment interest was payable, while the actual sum paid covered the rent alone for five months. Mr. Aggarwal for the petitioner, however, points out that as a matter of fact rent for only four previous months had become due by the 24th January 1962 and if rent for the fifth month was not paid, no default in respect of that payment can be said to have occurred. The reason is that, according to section 13, sub-section (2) of the East Punjab Urban Rent Restriction Act, rent in the absence of a specific agreement fixing the date for payment is payable "by the last day of the month next following that for which the rent is payable." No special agreement fixing any date for payment is proved in this case, and it is therefore clear that rent for the period, 6th December, 1961 to the 6th January 1952, had not become payable when the deposit of Rs. 150/- was made on the 24th January, 1962. The only default in payment of rent could have been in respect of the previous four months and the total rent amounted to only Rs. 120/, so that the excess of Rs. 30/- could be taken as more than coveting the small amount of interest that was payable on the arrears. On this view of the facts it is apparent that the tenant''s eviction should not have been ordered, as there was in law no default committed in respect of the payment of rent. The revision petition filed by Khushi Ram (Civil Revision 608 of 1963) must, therefore, be allowed with costs and the order of eviction set aside, and I would so order.

In the second case, Shri Vidya Prachar Trust v. Basant Ram, the Appellate Authority has gone into the details of the rent and interest and on calculation found that the deposits made along with the payment of Rs. 32/- in Court on the first date of hearing covered more than all the arrears as well as interest and costs. All that is said on behalf of the landlords is that the tenant had on both occasions, that is, 23rd December, 1959 and 18th July, I960, paid rent which had not become due, and that such payment of advance rent could not have been legally made by deposit u/s 31 of the Punja''1 Relief of Indebtedness Act, the argument being that only such amount, as is actually due from a debtor to a creditor, can be deposited u/s 31 of that Act. The argument, if I may so put it, is hyper technical. There can be no objection to a tenant paying rent in advance or tendering it in advance and if the landlord feels that he is not entitled to receive it at once, it is open to him to receive it later on. The advance payment can only be advantageous and certainly not injurious to the interest of a landlord, and I do not find any reason for saying that the deposit itself was in any sense irregular or unlawful. It has been found, and I think rightly, on the facts that no default in payment of rent was committed in this case and the prayer for eviction has been rightly refused. The revision petition (Civil Revision 750 of 1962) must, therefore, fail and I would dismiss it with costs.

P.C. Pandit, J.

I agree.