Secunderabad Commercial and Banking Co. vs Indermull

The applicants represent the firm, The Secunderabad Commercial and Banking Company, and, among other things, carry on cinema business. On 26th November 1912, this firm entered into an agreement with Sait Indermull, the opposite party, whereby the firm was granted a sub-lease of the premises and also the use of the R.C.A., equipment with accessories, etc., for a period of three years, commencing from 15th January 1913, the rent and hire being:

1st year... Rs. 400/- rent + Rs. 600/- hire for RCA equipment etc. 2nd year... Rs. 450/- " Rs. 650/- " " " 3rd year... Rs. 450/- " Rs. 700/- " " "

At this stage it should be made dear that Sait Indermull himself had rented these premises from certain trustees, Srikishen Gopi-kishen, in May 1940, and was running a cinema. The premises had seating arrangements made by the trustees but the cinema equipment such as machinery, etc., belonged to Sait Indermull. Some time in July 1945, a notice was given by Sait Indermull to the applicants that they should vacate the premises on the expiry of the lease, because he himself wanted to run the cinema in the premises. This notice was followed up by an advertisement in the papers that Sait Indermull would shortly open Inder Talkies in the promises. After that some correspondence passed between the parties.

Ultimately Sait Indermull applied to the Rent Controller u/s 8(2), Hyderabad Bent Control Order, 1353, Fasli and prayed for permission to take legal action for eviction against the applicants, which was the only remedy then open to him under the above Order. In their counter to the petition the applicants raised the following pleas : (1) the allegation that Sait Indermull required the premises for his own use was incorrect and it was a mere excuse to put pressure on the applicants to accept Sait Inder-''mull''s terms, (2) the application was a glaring abuse of the provisions of the Rent Control Order and was a device for compelling the applicants to pay exorbitant hire for an old R.C.A., equipment, which they did not require.

The Rent Controller decided in favour of the applicants and dismissed the petition, of Sait Indermull, who went in appeal to the First Taluqdar of Bagbat. There, the question arose whether the cinema equipment, i.e., E.O.A. equipment, etc, came under the definition of furniture as mentioned in Section 2, Rent Control Order. The First Taluqdar held that the Cinema equipments formed part of the premises and that the applicants had to pay the arrears of rent and hire within a fixed time, otherwise they were liable to be evicted. The decision was given on 6th Farwardi 1356 Fasli (6th February 1947).

After this decision, some time in February 1947, the applicants applied to the Rent Controller for fixation of fair rent as provided for under Sub-section 3, 4 and 5 of the Order. The main ground urged in the application is that the cinema equipment was old and as such the hire money originally fixed should be reduced. Before the Rent Controller, Sait Indermull raised the plea that the point was already decided and the doctrine of resjudicata applied. The Rent Controller rejected the plea, holding that there was nothing in the previous order of the First Taluqdar to bar the present application for the fixation of fair rent, and he accordingly directed that a date be fixed for hearing. Against this order, Suit Indermull went in appeal to the First Taluqdar and the First Taluqdar has now hold that the present petition for fixing the fair rent is barred by rep judicata. It is against this order of the First Taluqdar that this application foe the issue of a writ of certiorari to quash the order has been filed.

The advocate for the applicants argues that the previous proceedings between the par. ties were for eviction and the question of fixing a fair rent could not and did not then arise nor was it investigated and decided upon. The further contends that the question of a fair rent under the Rent Control Order is a distinct plea, which has to be raised in a substantive proceeding and therefore, neither the Rent Controller nor the First Taluqdar could decide the question of fair rent in eviction proceedings. In support of his contention the advocate for the applicants relies on (1) Section 3 of the Order, whereby a written application is necessary and is followed by summary enquiry into this question alone and the recording of facts and finding thereupon; on (2) Section 5 of the Order, whereby after the enquiry and the finding, the Rent Controller is bound to determine the fair rent which was not done in the previous proceedings; and on (3) Section 5 of the Order, whereby considerations for fixing the fair rent are the prevailing rents for same or similar accommodation in similar circumstances during the twelve months prior to 1st Khurdad 1351 F. (1st April 1942).

He states that neither did the applicants state the value of the R.C.A. equipment, hire, etc, at the relevant period nor Aid he lead any evidence as to what the rent should be. In this connection, he relies on Section 6(c) of the Rent Control Order, which provides for refund of rent paid in excess of the fair rent. The advocate for the applicants then referring to Section 8(5) of the Order urges that Section 7, Hyderabad Civil P.C. cannot be invoked because the Rent Control Order itself has provided a specific rule of res judicata u/s 8(5) and has confined the application of that doctrine to eviction petitions alone, this sub-section distinctly refers to Sub-section (2) of the Section. Under these circumstances, his argument is that the doctrine of res judicata has been wrongly applied. Its application hast led to non-exercise of jurisdiction vested in the Rent Control authority and therefore, he is entitled to have the order quashed. Moreover, be urges that the First Taluqdar had no jurisdiction to interfere until the present application has been finally disposed of by the Rent Controller, as the proceedings under the Rent Control Order are summary and the Rent Controller should be allowed to decide the case fully; the First Taluqdar should decide the matter when it comes to him in appeal after the final decision. Interference with interlocutory orders by the First Taluqdar was beyond his jurisdiction. The last argument of the learned advocate for the applicants is that if the applicants be held not to be entitled to a writ of certiorari, their application be treated as one for revision under the provisions of the Hyderabad Civil P.C.

The advocate for Sait Indermull argues that the First Taluqdar has jurisdiction to decide appeals under the Rent Control Order and he,, having exercised his jurisdiction, whatever be his decision, no writ of certiorari can be issued against him, for a wrong decision on legal points is no ground for interference by the High Court in exercise of its extra-ordinary powers. As regards the decision on res judicata, he urges that the applicants not having applied for fixation of fair tent before the presentation of the application for eviction and having shown their readiness to pay the full amount for the past rent, they were barred from re-agitating the matter on fresh application. He further argues that the sections referred to by the learned advocate for the applicants are inter-connected and the question of fixation of fair rent asked by the tenant can be gone into and be determined in eviction proceedings. Therefore, a defence which ought to have been raised then and not raised, cannot be re-agitated when there are no-fresh facts justifying its being raised.

In this connection, the following point arise for determination: (1) Whether there are sufficient grounds for quashing the order of the First Taluqdar by exercising the extra-ordinary powers of the writ of certiorari; (2) If not, can the applicants ask the High Court to treat their application as one for revision without amending the application; and (3) doss the previous decision in the conviction proceedings operate as res judicata to bar ascertainment of fair rent.

Generally, writ of certiorari is issued to correct error of jurisdiction where no such jurisdiction is vested in the authority whose decision is challenged, or where such authority fails to exercise jurisdiction vested in it or has exercised it illegally or with material irregularity. The power to issue the writ is wider than the power contained in Section 615, Hyderabad Civil P.C, which in similar to Section 115, Indian Civil P.C., The writ can be invoked against any person or authority exercising judicial or quasi judicial function here as the operation of Section 615, Civil P.C. is confided to Courts, which are subordinate to the High Court. It may happen that a particular functionary is not subordinate to the High Court and therefore, Section 615, Civil P.C. Section 615, Civil P.C. cannot be invoked in case. In such a case, the write of certiorari shall lie, for being vested with jurisdiction of administering justice the High Court is also authorised to correct error in the decisions of all authorities which have been entrusted with judicial or quasi-judicial functions. This does not mean that these functionaries are subordinate to the High Court in the confined technical sense in which this word ''Court'' is used in the Civil Procedure Code. They are subordinate in the sense that their decisions are liable to being corrected by the High Court. If we were to overlook this distinction, many difficulties will arise. To mention one, a functionary whose decision is liable to be corrected by a writ of certiorari may not be bound to observe all or any of the provisions of the CPC and yet he is subordinate to the High Court in the sense that his decision is liable to be quashed by exercise of extraordinary powers. I am, therefore, of opinion that the word "Court" used in Section 615, Hyderabad Civil P.C. cannot be extended to those authorities who are not proper judicial Courts. This, however, does not mean that any decision on Section 115, Indian Civil P.C. cannot be quoted as an authority for purposes of ascertaining whether there has been an error in exercise of jurisdiction. The legislature in framing Section 616 appears to have adopted the rules governing the issue of certiorari but curtailed its application to Courts sub coordinate to the High Court. Therefore, any decision on Section 615(b), Hyderabad Civil P.C. may be taken as an authority for holding what amounts to improper refusal of exercise of jurisdiction. Now recently, the Privy Council have held in AIR 1949 239 (Privy Council) that a wrong interpretation may lead to non-exorcise of jurisdiction and is, therefore, liable to be set aside'' in revision. At p. 142 of the report, their Lordships say:

...if the erroneous decision results in the subordinate Court exercising a jurisdiction not vested in It by law or failing to exercise the jurisdiction so vested, a case for revision arises under Sub-section (a) or Sub-section (b), and Sub-section (a) can be ignored.

There is, therefore, ample justification for the proposition that if a Court of law by an error of law refuses to exercise jurisdiction, that amounts to non-exercise of jurisdiction and the High Court-can interfere, and if the High Court can interfere in revision so far as the Subordinate Courts are concerned, I see no reason why it cannot interfere with decisions of other authorities, exercising quasi-judicial functions. This view is supported by the recent decision of the Madras High Court, reported in Miss Revathi by Next Friend and Guardian S. Parthasarathy Vs. M. Venkataraman and Another, where that High Court by exercising its extraordinary powers quashed a decision of the appellate authority under the Madras Rent Control Act, wherever on wrong interpretation of the principle of res judicata, it has directed dismissal of an application. I am, therefore, of opinion that if the decision of the first Taluqdar about the application of doctrine of res judicata be held to be incorrect, then we can, in exercise of our extra-ordinary powers, quash his decision on the ground that he has failed to exercise jurisdiction vested in him.

I do not propose to deal with the second question because on assumption that the first Taluqdar is a subordinate Court similar principle will apply and his decision will be liable to be upset on similar grounds.

Therefore, the main question in the case is, whether the principle of res judicata has been correctly applied to the fresh application for the fixation of fair rent.

Now, the Rent Control Order contemplates fixing of fair rent on application by a tenant under the section referred to by the Advocate for the applicants and in Section 8, a provision is made for his eviction. Those two proceedings, I am of opinion, are not interdependent, for in proceeding relating to eviction of a tenant, the Rent Controller is not authorised to fix a fair rent for the period prior to the filing of the application. He is bound to dismiss the application only if the rent agreed upon by the parties prior to filing of the application is tendered. Therefore, it is not open to him in such proceeding to entertain any application by the tenant for fixation of fair rent for the period prior to the institution of eviction proceeding, fix it and then dismiss the application for eviction on tender of this rent. If it be not open to him to do that it cannot be said that the present application is barred by res judicata for such a plea cannot be raised by way in that proceeding. Nor do I think that be question of estoppel arises. If a tenant having paid rent, can go to the Rent Controller for fixation of fair rent and demand back the excess amount. I see no reason why he is estopped from doing so by mere tender of past rent. If payment of agreed rent does not bar his statutory right of fixation of fair rent, then the tender of the amount should also be no bar, for seeking such statutory remedy, Therefore, the first Taluqdar was not legally cannot in holding that because in the prior proceedings these pleas were not raised, they are barred by principle of res judicata from being re agitated. This conclusion is further strengthened, by the provision of Section 8 (5), Rent Control Order. If the general principle of res judicata could be invoked, then there was no necessity of making express provision regarding its application to eviction proceedings alone.

The conclusion is that because in the former proceedings the defence of fixation of fair rent could not be raised, it cannot operate as res judicata in the present proceedings. I therefore, think that the first Taluqdar has erred in applying res judicata as a bar to the present application for fixing of fair rent and has thereby failed to exercise his jurisdiction. His order must be quashed. The application for a writ of certiorari is, therefore, allowed, the appellate decision is set aside and the file returned to the Rent Controller''s office for proper disposal of the application.