Case: Harbanslal Jagmohandas &amp; Anr Vs. Prabhudas Shivlal

was dated 1 December, 1956. The tenant by reply dated 7 December, 1956 contended that the contractual rent was excessive. The tenant made an application on 5 January 1957 for fixation of standard rent under section 11(1) of the Act. While the application was pending the landlord filed the suit on 27 January, 1957 for ejectment. The tenant in the written statement reiterated the contention that the contractual rent was excessive and that the standard rent should be fixed by the Court. On these facts the question in Vora Abbasbhais case (supra) was whether the case fall within section 12(3) (a) or section 12(3) (b) of the Act.The only point in controversy in Vora Abbasbhais case (supra) was whether the second condition in section 12(3) (a) of the Act, viz., that there was no dispute regarding the amount of standard rent was fulfilled. The landlords contention was that the dispute concerning standard rent is one which must have been raised before service of the notice and since there was admittedly no dispute in regard to standard rent or permitted increases at the date of service of the notice under section 12 (2) of the Act the second condition in section 12(3) (a) that there was no dispute was satisfied. This Court did not accept the landlords contention there and held that the defendant in that case raised the contention by reply dated 7 December, 1956 that the contractual rent was excessive and raised the same contention in the application filed for fixation of standard rent.14. The Gujarat High Court in Ambalals case (supra) held that in order to attract the applicability of section 12 (3) (a) of the Act there must be non-existence of the dispute at the date of the notice and such non-existence must continue right up to the expiration of one month from the date of service of the notice so that if the dispute is raised at any time prior to the expiration of the said period on one month, the operation of section 12(3) (a) would be excluded. The latest point of time when according to Ambalals case (supra) the dispute in regard to the standard rent must be raised in order to avoid the operation of section 12(3) (a) of the Act is the expiry of one month from the date of service of the notice. Ambalals case (supra) did not say that the dispute concerning standard rent must be raised before service of the notice in order to repel the applicability of section 12(3) (a) of the Act. If the dispute is in existence prior to the expiry of one month after service of the notice though subsequent to the date of the notice that would be sufficient to oust the operation of section 12(3) (a) of the Act. The decision of this Court in Vora Abbasbhais case (supra) has not overruled the decision in Ambalals case (supra). In Ambalals case (supra) the conclusion is a single one and it is that in order to exclude the operation of section 12(3) (a) of the Act the dispute must be in existence latest within one month after service of the notice.The question as to when a dispute is to be raised came up for consideration in Shah Dhansukhlal Chhanganlal v. Dalichand Virchand Shroff &Ors.. The appellant fell into arrears of rent in that case. The landlord gave a notice to the tenant on 18 April, 1955 demanding the arrears of rent and also terminating the tenancy of the defendant with effect from 31 May, 1955. The notice was received by the defendant on 21 April, 1955, The suit for ejectment was filed on 15 March, 1956 on the ground that the defendant was in arrears of payment of rent and permitted increases and as such not entitled to the protection of the Act. This Court held that section 12 (1) of the Act must be read with Explanation and so read it means that the tenant can only be considered to be ready and willing to pay if, before the expiry of the period of one month after notice referred to in sub-section (2), he makes an application to the Court under sub-section (3) of section 11 and thereafter pays or tenders the amount of rent or permitted increases specified by the Court. This Court found in Chhaganlals case (supra) that the tenant made no payment within t he period of one month of the notice of ejectment and further that although in his written statement he raised a dispute about the standard rent he made no application in terms of section 11(3) of the Act. The tenant can claim protection fro m the operation of section 12(3) (a) of the Act only if the tenant makes an application within one month of the service of the notice terminating the tenancy by raising a dispute as to standard rent.15. The view of the Bombay High Court overlooks the limitation of time within which a dispute is to be raised as to standard rent. The view of the Bombay High Court is that disputing within one month of the service of the notice terminating the tenancy is one mode of raising a dispute and the re is another mode of raising the dispute at any stage of the suit. The view of the Bombay High Court nullifies the provisions contained in section 12 and Explanation thereto and confers a right on the tenant where the legislation does not contemplate such a right.The provisions in section 11(3) of the Act deal with orders which may be passed by the Court during the pendency of the application disputing the rent. Provisions in section 11(4) of the Act deal with orders which may be pass ed consequent upon dispute as to rent. It is only when an application disputing rent is made within the time contemplated by Explanation I to section 12 of the Act that the provisions in sub-section (3) and (4) of section 11 are attracted.16.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]The view of the Bombay High Court overlooks the limitation of time within which a dispute is to be raised as to standard rent. The view of the Bombay High Court is that disputing within one month of the service of the notice terminating the tenancy is one mode of raising a dispute and the re is another mode of raising the dispute at any stage of the suit. The view of the Bombay High Court nullifies the provisions contained in section 12 and Explanation thereto and confers a right on the tenant where the legislation does not contemplate such a right.The provisions in section 11(3) of the Act deal with orders which may be passed by the Court during the pendency of the application disputing the rent. Provisions in section 11(4) of the Act deal with orders which may be pass ed consequent upon dispute as to rent. It is only when an application disputing rent is made within the time contemplated by Explanation I to section 12 of the Act that the provisions in sub-section (3) and (4) of section 11 are attracted.