Case: Bishan Paul Vs. Mothu Ram

1. In this appeal by special leave the appellant is the tenant of the respondent and occupies a shop situated on the Grant Trunk Road, Ludhiana. The High Court of Punjab by the judgment under appeal dated April 10, 1961 dismissed a revision petition filed by the appellant against the order of the Appellate Authority confirming the order of eviction passed against the appellant by the Rent Controller, Ludhiana, under S.13 of the East Punjab Urban Rent Restriction Act, 19492. The appellant entered into possession as tenant in 1944 and the monthly rent of the premises was Rs.12. The original landlord became an evacuee and as the property was composite, the District Competent Officer auctioned this property on May 19, 1956 and the highest bid was by the respondent. The bid was approved on October 3, 1956 and the sale certificate was issued to ther on December 4, 1956. On October 3, 1956 the appellant received a letter (Ex. R. 17) from the District Rent and Managing Officer, Ludhiana, informing him that as the sale was confirmed by the Competent Officer on October 3, 1956 he should pay the rent to the respondent from that date. The appellant alleged that he had tendered rent at Rs. 12 per month to the respondent who did not accept it but demanded Rs.20 per month. He further alleged that he had sent a money order for Rs. 12 and another for Rs. 24 which were refused by the respondent. The appellant deposited on July 16, 1958, Rs. 240 and Rs.144 on May 25, 1959 in the Court of Senior, Ludhiana (vide Exs. R. 18 and R. 20). In this way the appellant deposited rent for 32 months from October 30, 1956, to June 30, 1959 at Rs. 12 per month. Meanwhile, on May 22, 1959 the respondent made an application to the Rent Controller, Ludhiana under S.13 of the Act for the eviction of the appellant. He stated in that application that the rent of the shop was Rs. 20 per month and it had not been paid from October 3, 1956. He also alleged that the appellant had made material alterations in the shop and put it to use other than that for which it was taken on rent3. The Controller by his order, dated April 12, 1960 held that the standard rent was Rs. 12 and not Rs. 20. He held the other grounds not proved but ordered the eviction because the appellant had deposited the second amount three days after the petition of the respondent had been filed for eviction and the total amount deposited was not equal to the full rent, costs and interest as required by the Act. The amount deposited was found to be short by Rs.. The tenant appealed and contended that the tenancy commenced on December 4, 1956 and not on October 3, 1956. He applied for amendment of his pleadings to plead the above fact relying upon a ruling if this Court reported in Bombay Salt and Chemical Industries v. I. J. Johnson, AIR 1958 SC 289  . He contended that if the commencement of the tenancy was taken to be the date on which the certificate was granted to ther the amount of rent deposited by him was in excess of the amount due from him and he had not forfeited the tenancy. The Appellate Authority did not accept the contention. It held that the appellant had paid Rs. 1.19 to the Custodian as rent for the first two days of October and had accepted the respondent as his Landlord from October 3, 1956 and begun to deposit rent from that date. He was held, therefore, to be estopped under S. 116 of the Indian Evidence Act from denying the title of the respondent between October 3 and December 4, 1956. The appellant asked for relief against forfeiture but it was rejected in view of the ruling of the Punjab High Court in Debi v. Desa Ramji Lal, 36 Pun LR 284 : (AIR 1954 Punj 231)4. The tenant filed a Revision Petition in the High Court. It was dismissed by the order now under appeal. Only one question appears to have been raised in the High Court, namely, when did title pass to the? The High Court dismissed the revision application holding that title passed to the auction purchaser on the confirmation of the sale and not when the sale certificate was issued to him. The High Court distinguished the ruling of this Court above referred to.

Court's reasoning:
5. It may be stated at once that there is no proof on record that the standard rent was tendered by money order by the appellant. The only money order receipts are Exs. R. 27 and R. 28 but they show tender of rent respectively for two months from January 24, 1957 and for four months from April to July, 1959. These receipts neither cover the period from October 3, 1956 nor from December 4, 1956Unfortunately, the Rules do not indicate clearly the point of time from which the title of the auction purchaser is to commence as is done by S. 65 of the Code of Civil Procedure. Neither side claims to apply the provisions of the Transfer of Property Act and the case was argued on the basis of the Rules to determine the time from which title can be said to commence11. This fiction cannot apply here for the simple reason that no such provision is made in the rules8. The rules which we have earlier reproduced show that the auction is held on a date fixed and is subject to a reserve price which is confidential. The officer conducting the sale declares at the fall of hammer who is the highest bidder. The highest bid is subject to the approval of the Settlement Commissioner or an officer appointed by him. A period of seven days must elapse before the bid is approved and there is also a limitation of seven days from the acceptance of the bid for making an application to set aside the sale. If the bid is approved and if no application meanwhile for setting aside the sale is made, the highest bidder is recognised as the auction purchaser and he is required to produce a treasury challan in respect of the balance of the purchase money within a period of fifteen days (which period may be extended without limit of time) before the Settlement Commissioner or the Officer appointed by him. When the full purchase price is paid a Certificate issues in Form No. XXII and is sent to ther for registration. If the balance of the price is not paid, the amount of advance in deposit is forfeited and the auction purchaser has no claim to the property16. It seems to us that the matter must be considered on general principles. In this case the highest bid was of the respondent and he paid the full price before the sale in his favour was confirmed. The sale certificate, though issued later, mentioned the date of the confirmation of the sale in his favour. The tenant was asked to attorn to the purchaser from the date of confirmation of sale and thus possession was also delivered on that day. Title, therefore, was not in abeyance till the certificate was issued but passed on the confirmation of sale. The intention behind the rules appears to be that title shall pass when the full price is realised and this is now clear from the new form of the certificate reproduced in Jaimals case, 66 Pun LR 99 : (AIR 1964 Punj 99). No doubt till the price is paid in full there is no claim to the property, but it seems somewhat strange that a person who has paid the price in full and in whose favour the sale is also confirmed and who is placed in possession should only acquire title to the property from the date on which a certificate is issued to him. There may conceivably be a great deal of time spent before the certificate is granted. In this case the tenant was told to attorn from October 3, 1956 because nothing remained to be done except the ministerial acts of issuing the certificate and getting it registered. Therefore, so far as title was concerned, it must be deemed to have passed and the certificate must relate back to the date when the sale became absolute. The tenant himself paid rent for 2 days to the Custodian and deposited rent for the use of the new landlord from October 3, 1956. His defence originally was that he had tendered the rent from October 3, 1956 and even sent it by money order but the landlord refused to receive it, He thus acknowledged the new landlord and attorned to him from October 3, 1956. It was only when the decision in the Bombay Salt and Chemical Industries case, AIR 1958 SC 289  , was given that he changed his stand. That case, however, did not decide the precise point on which he rested his new defence. The rulings on which he relies also erroneously accepted the decision of this Court in the Bombay Salt and Chemical Industries case, AIR 1958 SC 289  , to have decided the point when title commences. As has been rightly pointed out in Jaimals case, 66 Pun LR 99 (AIR 1964 Punj 99), the point was at large. In our judgment, the landlord in the present case could maintain the proceedings for ejectment. We agree generally with the observations of Tekchand, J. in Roshanlal Goswami v. Gobind Ram, 65 Pun LR 852 : (AIR 1963 Punj 532), that the landlords right to bring a suit for ejectment need not necessarily depend on the issuance of the certificate. In this case the landlord had paid the full price, his bid was approved and he had received a certificate mentioning the date of confirmation. In our judgment, he obtained title on the date of confirmation of the sale and could demind rent from that date as indeed he was informed and he himself understood to be the true state of affairsThere is much force in this contention but the question is not res integra. This section was interpreted by this Court in Waryam Singh v. Amarnath, 1954 SCR 565   : (AIR 1954 SC 215  ). In that case the tenant had admittedly not paid rent as required by S. 13(2) of the East Punjab Urban Rent Restriction Act as applied to Himachal Pradesh. The Rent Controller and the District Judge, on appeal, did not order eviction. The Judicial Commissioner was moved under Arts. 226 and 227 of the Constitution and he held that "in view of the admitted failure to pay rent as provided by the rent deed or at the first hearing of the Court under the proviso to S.13 (2) (i) the Courts below had acted arbitrarily in refusing to make an order for ejectment against the tenants"The decision is binding us and as pointed out by Kapur, J. (as he then was) in 56 Pun LR 284: (AIR 1954 Punj 231), the ruling of this Court makes it incumbent on the Rent Controller to order eviction. In this view of the matter there is no relief possible to the appellant.