Harjit Singh Uppal vs Anup Bansal

3. The facts are these. The petition under Section 13 of the 1949 Rent Act was filed by the Respondent (`landlord') to evict the appellant (`tenant') from Komfort Banquet Hall, Zirakpur-Panchkula Road, Zirakpur, Tehsil Dera Bassi, District S.A.S. Nagar (Mohali) (for short, `the premises') before the Court of Rent Controller, Dera Bassi on December 6, 2008. The landlord averred that the premises were leased out to the tenant for a term of five years commencing from August 11, 2003 at the rent of Rs. 1,50,000/- per month. As per the terms of lease, rent would increase at the rate of 5 per cent every year on the last prevailing rent and it was also agreed that the tenant shall pay the rent for every month in advance by the 7th of month. It is the case of the landlord that tenant stopped paying the rent since April, 2007 regularly. Ultimately, after the expiry of the first lease period, the tenant requested for reduction in rent and he agreed to pay the rent of the premises at the rate of Rs. 1,50,000/- per month with effect from August 11, 2008 for the period of 31 2 months. The tenant also agreed to pay the Service Tax at the rate of 12.5 per cent and also increase the rent at the rate of 5 per cent every year on the last prevailing rent.

4. The claim of eviction, inter alia, was founded on the ground of default. It was averred that the tenant failed to make the payment of rent regularly and has fallen in arrears to the extent of Rs. 27,84,875.04 along with Service Tax at the rate of 12.5 per cent.

5. The tenant filed written statement and traversed the case set up by the landlord in the petition for eviction. He averred that the premises were incomplete at the time of lease and he invested huge amount for its completion by taking loan from the banks amounting to Rs. 58,98,370/-. The tenant claimed adjustment of that amount. He also stated in the written statement that he has been paying rent to the landlord regularly - mostly by cheques- and from 2007 he has paid Rs. 37,00,950/- to the landlord. He raised counter claim and claimed refund of the excess amount paid to the landlord.

6. On June 6, 2009, the tenant filed an affidavit before the Rent Controller setting out in detail the statement of the 3 payment of rent made by him from April, 2007 amounting to Rs. 37,00,950/-.

7. The Rent Controller determined the provisional rent on June 11, 2009 assessing the arrears of rent provisionally at Rs. 27,84,875.04. The Rent Controller directed the tenant to make the payment of arrears of rent as determined with interest at the rate of 6 per cent per annum and costs of Rs. 1,000/- on July 18, 2009.

12. The Rent Controller considered all these applications together and by her order dated April 7, 2010 rejected each one of these applications. The Rent Controller held that there was no provision of law under which the order dated June 11, 2009 could be recalled/reviewed. It was held, relying upon a decision of this Court in Rakesh Wadhawan and others v. Jagdamba Industrial Corporation and others1, that on the failure of the tenant to comply with the order of the provisional assessment of arrears of rent, nothing remains to be done and order of eviction has to follow. Accordingly, the Rent Controller passed the order of eviction against the tenant on April 7, 2010.

14. The Appellate Authority heard the parties and held that the provisional assessment order dated June 11, 2009 was patently illegal. The Appellate Authority, accordingly, allowed the appeal by its order dated June 10, 2010, set aside the orders dated April 7, 2010 and June 11, 2009 passed by the Rent Controller and remanded the matter to the Rent Controller with a direction to pass fresh order regarding the provisional assessment of the arrears of rent, interest and costs of the proceedings. The Appellate Authority also directed the Rent Controller to give to the parties an opportunity to produce the documents/affidavits in support of their rival stand in respect of the rent.

15. The landlord challenged the order passed by the Appellate Authority in the revision petition before the High Court of Punjab and Haryana. The Single Judge of that Court held that since the tenant did not avail his remedy to challenge the order fixing provisional rent, during the period between the date of the order and date fixed for payment, the Rent Controller had no choice but to pass an order of eviction. The High Court, accordingly, by its order 6 dated September 23, 2010 allowed the revision petition and set aside the order of the Appellate Authority and restored the order of the Rent Controller.

Provided that no appeal shall lie against any order specified in clause (ff) save on the ground that no order, or an order for the payment of a less amount, ought to have been made. (2) No appeal shall lie from any order passed in appeal under this section.

(2) Notwithstanding anything contained in sub-section (1), where any party aggrieved by an order of remand from which an appeal lies does not appeal therefrom, he shall thereafter be precluded from disputing its correctness."

[Emphasis supplied by us] 30 The order passed by the Rent Controller determining the provisional rent in an eviction petition based on the ground of default in a situation where the tenant fails to comply with that order may be a foundational order for an order of eviction that follows but nevertheless such order is an interlocutory order as that order does 17 not determine the principal matter finally; it is only the order on subordinate matter with which it deals.

statement given by the tenant at all and relied upon the ledger account submitted by the landlord and in his order dated June 11, 2009 held that an amount of Rs. 27,84,875.04 was due and payable by the tenant towards the arrears of rent. Since the Rent Controller failed to even consider the statement of payment tendered by the tenant, the tenant made an application for recall of the order dated June 11, 2009. The Rent Controller dismissed the application for recall and two other applications made by the tenant by a common order and also passed an order for eviction of the tenant on April 7, 2010 as the tenant failed to comply with the order dated June 11, 2009 determining the provisional rent.

40. The High Court, however, held that as tenant did not avail of his remedy to challenge the order fixing provisional rent during the period between the date of the order and date fixed for payment, the Appellate Authority could not have gone into the merits 24 of such determination and, accordingly, set aside the order of the Appellate Authority. In our view, the High Court fell into grave error in what it held. The legal position, in our opinion, is this: Where a tenant does not challenge the order of the fixation of provisional rent passed under Section 13(2)(i) proviso in appeal under Section 15(1)(b) and also fails to comply with that order, the order of eviction must follow as per the provisions contained in the 1949 Rent Act but when the tenant challenges the order of eviction in appeal and therein also challenges the order determining the provisional rent, it is not open to the Appellate Authority to refuse to consider the legality and validity of the order determining the provisional rent on the ground that the correctness of such order cannot be examined as no appeal was filed from that order though an appeal lay therefrom.

41. On the facts of the present case, the Appellate Authority did not commit any error in calling upon the Rent Controller to determine the arrears of rent, interest and costs afresh as the tenant's statement of payments towards rent from April, 2007 was not at all referred to and considered by the Rent Controller. If the order of the High Court is allowed to stand, it would occasion in manifest injustice and result in miscarriage of justice inasmuch as the tenant 25 would be thrown out of the leased premises although he may not have been in arrears of rent. In the circumstances, re-determination of arrears of rent, interest and costs by the Rent Controller, as directed by the Appellate Authority, would subserve the ends of justice. If on re-determination, the tenant is found in arrears of rent and does not deposit/pay the amount as determined by the Rent Controller in time, as may be directed, obviously he would suffer the order of eviction.

42. In the result, the appeal is allowed. The order dated September 23, 2010 passed by the High Court is set aside and the order dated June 10, 2010 passed by the Appellate Court, S.A.S Nagar (Mohali) is restored. The parties shall bear their own costs.

(R.M. Lodha) NEW DELHI.

MAY 13, 2011.