CR No.3704 of 2007 - 1 - HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH **** (1) CR No.3704 of 2007 Date Of Decision: 09.09.2009 **** M/s. Aggarwal and Company and others . . . . Petitioner VS. Food Corporation of India and anr. . . . . Respondent **** (2) CR No.3705 of 2007 Date Of Decision: 09.09.2009 **** M/s. Aggarwal and Company and others . . . . Petitioner VS. Food Corporation of India and anr. . . . . Respondent **** CORAM : HON’BLE MR.JUSTICE SURYA KANT **** 1. Whether Reporters of local papers may be allowed to see the judgment? 2. To be referred to the Reporters or not? 3. Whether the judgment should be reported in the Digest? **** Present: Mr. Tribhuwan Singla, Advocate for the petitioner Mr. Hemen Aggarwal, Advocate for the respondent **** SURYA KANT J.(ORAL) This order shall dispose of Civil Revision No.3704 of 2007 and Civil Revision No.3705 of 2007 which are inter-se parties and raise common questions of law and facts. For brevity, the facts are being extracted from CR No.3704 of 2007. The petitioner-landlords are aggrieved at the order dated 29.11.2006 passed by the Appellate Authority, Jind, whereby, granting interest @ 8 per annum on the arrears of fair rent, has been set aside. CR No.3704 of 2007 - 2 - The petitioners have let out a godown to the respondent-Food Corporation of India situated at Hansi Road, Jind. The petitioners applied for determination of fair rent which was assessed by the Rent Controller, Jind at the rate of 41103/- p.m. w.e.f 6th June, 1995 vide his order dated 23rd April, 1997. The FCI, appeal was also dismissed by the Appellate Authority, Jind, vide its order dated 3rd December, 1999. The tenant-FCI, thereafter, approached this Court by way of CR No.1357 of 2000 which was compromised and disposed of on November 27, 2000 in the following terms: “Learned counsel for the parties have recalculated the fair rent in terms of the judgement rendered by this Court in Yoginder Mohan V. Krishan Lal 1999(2) RCR 466. Copy of the calculations made by the parties has been handed over in court today and the same is taken on record and marked as Annexure ‘A’. In view of the consent of the learned counsel for the parties, the fair rent is determined at Rs.38,669/- CR No.1357 of 2000 is accordingly disposed by holding that the fair rent of the building would be Rs.38669/-.” It may, thus, be seen that the fair rent of Rs.41103/- determined by the Rent Controller, Jind, was marginally reduced and fixed @ Rs.38669/- p.m. though with effect from the same date i.e. 6th June, 1995. The respondent tenants tendered the arrears of agreed fair rent as determined by this Court, amounting to Rs.1,67,627/- on 21st July, 2001, however, without any interest. The petitioners on the other hand claimed interest @ 15% per annum on the plea that when the FCI had preferred appeal against the fixation of fair rent of Rs.41103/- p.m. by the Rent Controller, the Appellate Authority had granted them stay subject to the condition that in the event of failure of appeal the respondent-tenant shall be liable to pay interest @ 15% per annum. CR No.3704 of 2007 - 3 - The above stated interest claim partly sustained before the Rent Controller who, having regard to the First Proviso to Section 13(2)(i) of the Haryana Urban (Control of Rent and Eviction) Act, 1973 (for short, the Act), awarded interest to the petitioners @ 8% per annum. The respondent-FCI, however, preferred an appeal which has been allowed by the Appellate Authority vide the impugned order, holding that in view of the agreed order dated 27.11.2000 passed by this Court as reproduced above, the petitioners are not entitled to any interest on the arrears of fair rent. I have heard the learned counsel for the parties at some length and perused the impugned orders. Section 4 of the Act enables the Rent Controller to determine fair rent of a rented building/land on application by the tenant or the landlord of the premises and such fair rent “shall be operative from the date of application”. Sub-Section (5) thereof provides that “notwithstanding anything contained in this Act, the Controller may fix the fair rent on the basis of the compromise arrived at between the parties to the proceedings provided that such rent shall be binding on the parties and their heirs.” There can indeed be no doubt that the parties entered into a compromise before this Court in terms whereof the fair rent was determined at Rs.38669/- p.m. vide order dated 27.11.2000. In other words, the fair rent binding on the parties came to be determined on 27.11.2000 only. Section 13(2)(i) of the Act provides that a tenant can be evicted from a demised premises if he has not paid or tendered “rent due from him in respect of the building or rented land within 15 days after the expiry of time fixed in the agreement of the 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 paid.” However, the First Proviso thereto provides that if a tenant, within 15 days of the first hearing of the application or ejectment after due service, pays or tenders the arrears of rent and interest @ 8% per annum on such arrears, together with such costs as may be allowed by the Controller, the tenant shall be deemed to have duly paid or tendered the rent within the time aforesaid.” CR No.3704 of 2007 - 4 - In my considered view, the liability of the tenant to pay interest @ 8% in terms of First Proviso to Section 13(2)(i) of the Act arises only when he fails to pay or tender the rent due or when he is required to pay or tender such due rent within 15 days of the first hearing of the application for ejectment. The due rent would be only when it has been determined or there is no dispute between the parties in relation thereto. It would necessarily mean that if there is no determined rate of rent, the tenant would be unable to tender the same under Section 13(2)(i) of the Act and cannot be fastened with the liability to pay interest @ 8% per annum. In the case in hand, the rent at the binding rate of Rs.38669/- p.m. was determined on 27th November, 2000. The liability of the respondent-tenant to pay interest thereupon could accrue only after 15 days on its presumed failure to pay the same. In this manner, the petitioners are entitled to be paid interest @ 8% per annum as per the First Proviso to Section 13(2)(i) after15 days of the determination of rent i.e. with effect from 15.12.2000 till such arrears were actually tendered on 21st July, 2001. The Revision Petition is, accordingly, allowed in part; the impugned order dated 29.11.2006 of the appellate authority is modified to the extent above and the respondents are directed to calculate the arrears of the interest @ 8 % per annum w.e.f. 15th December, 2000 to 21st July, 2001 and pay the same to the petitioners within 2 months from the date of receipt of copy of this order. No costs. (SURYA KANT) JUDGE 09.09.2009 shonkar