Power U/S. 15(7) of the Delhi Rent Control Act, 1958 should be exercised sparingly: High Court of New Delhi

IN THE HIGH COURT OF DELHI AT NEW DELHI Date of Decision: 07.04.2021 CM(M) 476 2020 & CM No.24292 2020 SATISH PARASHAR ..... Petitioner Through: Mr.Sanat Kumar Sr. Adv. with Mr.Sanjay Sharma Adv. PREM BIHARIThrough: Mr.Sanjay Rohtagi Adv. ..... Respondent HON BLE MR. JUSTICE NAVIN CHAWLA NAVIN CHAWLA J.This petition has been filed by the petitioner challenging the order dated 04.03.2020 passed by the learned Rent Control Tribunal in short „RCT‟) in appeal being RCT No.138 2018 dismissing the appeal of the petitioner against the order dated 17.08.2018 passed by the learned Additional Rent Controller 01 Central dismissing the application of the petitioner seeking condonation of delay in filing of an application seeking review of the order dated 14.03.20211 passed by the learned ARC under Section 15(1) of the Delhi Rent Control Act 1958 and consequently allowing the application of the respondent herein under Section 15(7) of the Act. CM(M) 476 2020 Page 1 respondent had filed an eviction petition being E.No.821 2014 against the petitioner under Section 14(1)(a) of the Act claiming that the petitioner is a tenant with respect to property being Middle Flat on the first floor of building no.27 Alipur Road Civil Lines Delhi 110054 at rate of rent of Rs.850 per month exclusive of electricity and water charges. Paragraph 14 of the Eviction Petition asserts that the date of letting out of the tenanted premises is 16.07.1998 “on the basis of written agreement”. It is important to note here itself that the Agreement dated 16.07.1998 however gives the rent as Rs.750 per month. In the eviction petition the respondent claimed arrears of rent of Rs.22 950 for the period with effect from 01.04.2008 to 30.06.2010 at the rate of Rs.850 per month. The petitioner herein filed his reply to the eviction petition disputing the rate of rent and claiming the same to be Rs.750 per month. On the first date of his appearance before the learned ARC on 27.10.2010 the petitioner also tendered a demand draft of Rs.26 350 dated 21.10.2010 to the respondent. On 14.03.2011 the learned ARC passed the following order on the application filed by the respondent under Section 15(1) of the Act: “14.03.2011 Present: Counsel for petitioner. Counsel for respondent. Parties in person. A sum of Rs. 26 350 has already been paid on behalf of respondent to the petitioner through Bank Draft on 27 10 2010 against CM(M) 476 2020 Page 2 Argument heard on the application U s. 15of the DRC Act. The rate of rent is Rs.850 per month the parties and is admitted by is also not denied. Hence application U s. 15 of the DRC Act is disposed of without prejudice to the rights and contentions of the parties. Respondent to deposit the legally recoverable rent which is due till the month of March 2011 within one month from today in the Bank Account number i.e. 0115000100442064 PNB Civil Lines Delhi and will continue to deposit the future rent in the aforesaid Bank Account during the pendency of the present petition. Nothing discussed hereinabove shall have any bearing upon the merits of the present case. Hence put up for PE on 06 07 2011. Advance copy of affidavit be supplied atleast 15 days before the next date of hearing. Parties to file their list of witnesses within 15 days from today.” A perusal of the above order would show that Rs.850 per month was taken as the rent admitted by the parties. It is not disputed by the respondent that the petitioner however continued to pay deposit the rent at the rate of Rs.750 per month thereafter. Based on the purported default by the petitioner on 26.09.2012 the respondent filed an application under Section 15(7) of the Act seeking striking off of the defence of the petitioner herein. The petitioner on the other hand filed an application under Section 152 of the Code of Civil Procedure 1908 on 16.11.2012 claiming rectification of the order dated 14.03.2011 to record that the admitted rate of rent was Rs.750 per CM(M) 476 2020 Page 3 month and not Rs.850 per month as had been recorded in the order dated 14.03.2011. The applications remained pending as in the meantime the respondent expired and his legal heirs were finally brought on record by the order dated 28.03.2014. On 30.09.2015 after some arguments the petitioner withdrew the application filed under Section 152 of the Code. 10. The learned senior counsel for the petitioner submits that the same was withdrawn on the legal advice that the remedy of the petitioner was not in form of an application under Section 152 of the Code but instead in form of an application seeking review of the order dated 14.03.2011. 11. The petitioner thereafter on 08.10.2015 filed the application seeking review of the order dated 14.03.2011. Alongwith the said application the petitioner also filed an application under Section 5 of the Limitation Act 1963 seeking condonation of delay in filing of the application seeking review. 12. The said applications were dismissed by the learned ARC by the order dated 17.08.2018 refusing to condone the delay in filing of the application seeking review. The learned ARC in his order dated 17.08.2018 observed that there was a delay of around 4 ½ years in filing of the application seeking review which could not be explained merely by putting the blame on the previous counsel. It was further CM(M) 476 2020 Page 4 held that even the new counsel had taken ten months to withdraw the previous application filed under Section 152 of the Code. 13. Consequent to the dismissal of the application of the petitioner under Section 5 of the Limitation Act 1963 and the application seeking review of the order dated 14.03.2011 the application of the respondent under Section 15(7) of the Act was allowed by the learned ARC vide its order dated 17.08.2018. It is relevant to note here that the learned ARC allowed the application under Section 15(7) of the Act as a mere sequitur to the dismissal of the application of the petitioner seeking review of the order dated 14.03.2011 without considering whether on the facts of the case the petitioner could be held to have contumaciously not deposited the rent pursuant to the order dated 14.03.2011 of the learned ARC. Relevant extract from the order is reproduced herein the Limitation Act of “Cogent reasons have not been disclosed in the application for condonation of delay of the long period of around 4 ½ years. In these facts the application under and circumstances Section 5 of respondent is dismissed. Since the application under Section 5 of the Limitation Act has been dismissed review modification recall of the order dated 14.03.2011 is also dismissed. Now the application of the petitioner under Section 15(7) of the Delhi Rent Control Act is taken up for consideration. Reply to the application has been filed. CM(M) 476 2020 Page 5 It is an admitted case of the respondent that rent has not been paid or deposited at the rate of Rs.850 per month. Since rent has not been paid or deposited in accordance with the order dated 14.03.2011 which has attained finality the defence of the respondent is struck out.” 15. The petitioner thereafter filed an appeal before the learned RCT which has been dismissed by the Impugned Order dated 04.03.2020. The learned RCT has affirmed the decision of the learned ARC refusing to condone the delay in filing of the application seeking review. The learned RCT has also affirmed the order of the learned ARC passed under Section 15(7) of the Act observing that in the reply of the petitioner to the application filed under Section 15(7) grounds similar to those pleaded under Section 5 of the Limitation Act 1963 had been pleaded by the petitioner. The learned RCT further held that the petitioner has not filed any application seeking condonation of delay or default in compliance with the order under Section 15(1) of the Act nor offered to pay the balance amount of arrears of rent which reflected bold obstinacy on the part of the petitioner in not complying with the order passed under Section 15(1) of the Act which has attained finality. 16. The learned senior counsel for the petitioner submits that the order dated 14.03.2011 clearly proceeded on an incorrect presumption that the rate of rent was admitted by the petitioner to be Rs.850 per month. He submits that in fact this was the bone of contention between the parties in the eviction petition and the dispute to be adjudicated between the parties. The admitted rent as far as the CM(M) 476 2020 Page 6 petitioner is concerned was Rs.750 per month as was reflected in the Rent Agreement dated 16.07.1998 which is an admitted document. He further submits that as on 14.03.2011 there was no evidence before the learned ARC evidencing Rs.850 per month to be the last paid rent on the basis of which alone the learned ARC could have directed the petitioner herein to pay deposit the rent at the rate of Rs.850 per month. He submits that this mistake was realized only when the respondent filed an application under Section 15(7) of the Act on 26.09.2012. The petitioner immediately thereafter on 16.11.2012 filed the application under Section 152 of the Code. The petitioner was advised that the remedy of the petitioner would be in form of an application seeking review of the order and therefore withdrew the said application on 30.09.2015 and within nine days thereafter on 08.10.2015 filed an application seeking review of the order dated 14.03.2011. He submits that therefore the reason for delay in filing of the application seeking review was the legal advice then received by the petitioner that the remedy would be in form of an application under Section 152 of the Code. 17. Placing reliance on the judgment of the Supreme Court in Rafiq Ors. vs. Munshilal & Ors. AIR 1981 SC 1400 he submits that the petitioner cannot be prejudiced for having acted on the advice received from his counsel. 18. He further submits that in any case the petitioner could not have been held to have contumaciously not deposited the rent as directed by the learned ARC. The petitioner has been duly depositing CM(M) 476 2020 Page 7 the rent at the rate of Rs.750 per month and was pursuing his legal remedies seeking rectification of the order dated 14.03.2011 passed under Section 15(1) of the Act. He submits that the closure of the right to defence is a drastic measure and is to be resorted to only when the tenant is found to have acted contumaciously and in total disregard of the order passed. In this regard he has placed reliance on the judgment of the Supreme Court in Miss. Santosh Mehta v. Om Prakash and Ors. 3 SCC 610 and of this Court in Nirmal Kapoor vs. Sushila Devi Jain & Ors. 10 DRJ 323. 19. On the other hand the learned counsel for the respondent submits that the two Courts below having exercised their discretion in not condoning the delay and subsequently allowing the application of the respondent under Section 15(7) of the Act this Court would not interfere with the same in exercise of its powers under Article 227 of the Constitution of India. 20. On merit he submits that the order dated 14.03.2011 was passed in the presence of the petitioner as also his learned counsel. The petitioner took no steps to have the same reviewed rectified till the respondent filed the application under Section 15(7) of the Act. The petitioner thereafter let such application remain pending for almost four years before withdrawing the same and then filed an application seeking review of the order dated 14.03.2011. He submits that in the meantime inspite of the order dated 14.03.2011 having not been rectified reviewed the petitioner failed to deposit the rent at the rate of Rs.850 per month thereby clearly showing an intention not to CM(M) 476 2020 Page 8 comply with the direction passed by the learned ARC. He submits that therefore the learned ARC and the learned RCT have rightly exercised their discretion in not condoning the delay in filing of the review application by the petitioner and striking off his defence under Section 15(7) of the Act. for the parties. I have considered the submissions made by the learned counsels 22. A perusal of the pleadings that is the eviction petition filed by the respondent and the reply thereto filed by the petitioner clearly indicates that there is a dispute between the parties as to the rate of rent qua the tenanted premises. While the respondent claims the same to be Rs.850 per month the petitioner has taken a stand that it is Rs.750 per month. It is not denied by the learned counsel for the respondent that the Rent Agreement dated 16.07.1998 relied upon by the respondent in the eviction petition mentioned the rent as Rs.750 per month. It is also not denied that there was no other document before the learned ARC as on 14.03.2011 which would have shown the admitted rate of rent last paid by the petitioner as Rs.850 per month. 23. Section 15(1) of the Act reads as under: “15. When a tenant can get the benefit of protection against eviction.In every proceeding of the recovery of possession of any premises on the ground specified in clause a) of the proviso to sub sectionof section 14 the Controller shall after giving the parties an opportunity of being heard make an CM(M) 476 2020 Page 9 order directing the tenant to pay to the landlord or deposit with the Controller within one month of the date of the order an amount calculated at the rate of rent at which it was last paid for the period for which the arrears of the rent were legally recoverable from the tenant including the period subsequent thereto up to the end of the month previous to that in which payment or deposit is made and to continue to pay or deposit month by month by the fifteenth of each succeeding month a sum equivalent to the rent at that rate.” 24. A reading of the above would show that on an application of the landlord the Controller may make an order directing the tenant to pay to the landlord or deposit with the Controller an amount “calculated at the rate of rent at which it was last paid” for the period for which the arrears of rent were legally recoverable from the tenant. As on 14.03.2011 therefore the learned ARC had before him the admitted rate of rent of Rs.750 per month as against the rate of rent of Rs.850 as claimed by the respondent. The order dated 14.03.2011 has been reproduced hereinabove. The same records rent at the rate of Rs.850 per month has been admitted by the petitioner. This would be clearly contrary to the record before the learned ARC and therefore erroneous on the face of the record. 25. The respondent filed the application under Section 15(7) of the Act on 26.09.2012. It is not denied that before the returnable date on the said application the petitioner filed an application under Section 152 of the Code on 16.11.2012 praying that the order dated 14.03.2011 be rectified to record the admitted rate of rent as Rs.750 CM(M) 476 2020 Page 10 per month instead of and in place of Rs.850 per month. It is not denied that the said application remained pending till 30.09.2015 when the same was withdrawn by the petitioner. Within nine days thereafter the petitioner filed an application seeking review of the order dated 14.03.2011 alongwith an application seeking condonation of delay under Section 5 of the Limitation Act 1963 in filing such application seeking review. The reasons given for the delay was the pendency of the earlier application which was claimed to have been filed on an incorrect legal advice by the previous counsel. It is not denied that in the meantime the petitioner has been duly depositing the rent at the rate of Rs.750 per month. 26. Keeping in view the above facts it could not have been said that the petitioner was either not diligent in seeking rectification of the order dated 14.03.2011 passed by the learned ARC or has acted contumaciously or with obstinacy in making compliance with the said order. The petitioner was pursuing his legal remedies as had been advised to him and clearly there was no delay in pursuing the same. In Miss. Santosh Mehta the Supreme Court has held that Section 15(7) of the Act is a penal provision and is discretionary in nature. It has a built in self restraint and is to be resorted to in only exceptional circumstances and not in a routine manner following upon a mere failure to pay rent. It is an extreme power and therefore should be exercised where the Court finds a wilful failure deliberate default or volitional non performance. It is not an automatic weapon and therefore the last resort must not be converted into the first resort. CM(M) 476 2020 Page 11 In Kamla Devi vs. Vasdev 1 SCC 356 the Supreme Court reiterated that it is not obligatory for the Rent Controller to strike out the defence of the tenant under Section 15(7) of the Act if the tenant fails to make payment or deposit. It would depend upon the facts of the case and the discretion of the Controller whether such drastic order should or should not be passed. It is also noted that the effect of striking off the defence under Section 15(7) of the Act is not only in form of depriving the tenant his right to defend the Eviction Petition but would also lead to him losing the protection under Section 14(2) of the Act. Therefore there can be no denial that such power is to be exercised sparingly and judiciously. 30. The findings of the learned ARC on the application under Section 15(7) of the Act have been quoted hereinabove. The same do not consider that the petitioner had continued to make deposit of rent in the integerrum at the rate of Rs.750 per month on a regular basis. Similarly the learned RCT also has not considered the effect of the petitioner having made such deposit on a regular basis. Clearly the factum of such deposit reflects that the petitioner has not acted with obstinacy or in utter defiance of the order passed under Section 15(1) of the Act as held by the learned RCT. 31. As noted hereinabove there appears to be a mistake in the order dated 14.03.2011 passed by the learned ARC wherein Rs.850 per month was taken as the admitted rate of rent while this was clearly a dispute between the parties. The said order was liable to be rectified by the learned ARC. CM(M) 476 2020 Page 12 32. Accordingly I find that the learned ARC and the learned RCT have failed to exercise the jurisdiction which was vested in them in failing to condone the purported default of petitioner in complying with the order dated 14.03.2011 passed by the learned ARC and consequently striking off his defence. In view of the above the Impugned Order dated 04.03.2020 is set aside. 34. At this stage I may also note that the Eviction Petition has been pending since 2010. The learned ARC is therefore requested to expedite the hearing in the said petition and make endeavor to adjudicate on the same within a period of nine months from the date when it is next listed before it. In this endeavor the learned ARC shall refuse any all unwarranted requests for adjournment by either party. 35. As admittedly the petitioner did not notice the mistake in the order dated 14.03.2011 till the time the respondent filed the application under Section 15(7) of the Act the petitioner shall without prejudice to his rights and contentions clear all arrears of rent at the rate of Rs.850 per month alongwith interest at the rate of 15% per annum thereon in compliance with the order dated 14.03.2011 within eight weeks from today. The petitioner shall continue to pay deposit the rent at the rate of Rs.850 per month as directed in the order dated 14.03.2011 in future as well. CM(M) 476 2020 Page 13 36. The petitioner shall further pay costs of Rs.25 000 to the respondent for the delay that has been caused in the adjudication of the Eviction Petition. 37. The present petition is allowed in the above terms. NAVIN CHAWLA J APRIL 7 2021 Arya CM(M) 476 2020 Page 14 

Summary: The effect of striking off the defense under Section 15(7) of the Act is not only in form of depriving the tenant of his right to defend the Eviction Petition, but would also lead to him losing the protection under Section 14(2) of the Act. Therefore, there can be no denial that such power is to be exercised sparingly and judiciously. This was held in SATISH PARASHAR V. PREM BIHARI (SINCE DECEASED) [TCM(M) 476/2020] in the HIGH COURT OF NEW DELHI by a single bench consisting of JUSTICE NAVIN CHAWLA. Facts are that the respondent had filed an eviction petition, against the petitioner under Section 14(1)(a) of the Act. The learned ARC passed the order U/S.15(1) of the Act. The petitioner aggrieved by the ARC order filed an application seeking review along with condonation of delay, which was dismissed. And on subsequent dismissal by RCT, the present petition was filed. The counsel for the petitioner contended that the order of Arc proceeded on an incorrect presumption of the rate of rent. The reason for the delay in filing the application seeking review was the legal advice received in form of an application under Section 152 of the CPC. Reliance was placed on the judgment of Rafiq &amp; Ors. vs. Munshilal &amp; Ors. The counsel for the respondent contended that the two Courts below had exercised their discretion in not condoning the delay and had allowed the application of the respondent under Section 15(7) of the Act, this Court should not interfere with the same in exercise of its powers under Article 227 of the Constitution of India. The court also made reference to the judgement of the Apex court in, Miss. Santosh Mehta v. Om Prakash and Ors., wherein it was held that “Section 15(7) of the Act is a penal provision and is discretionary in nature. It has a built-in self-restraint and is to be resorted to in only exceptional circumstances and not in a routine manner following upon a mere failure to pay rent. It is an extreme power and therefore, should be exercised where the Court finds a willful failure, deliberate default, or volitional non-performance. It is not an automatic weapon and therefore, the last resort must not be converted into the first resort.” The court in order to shed light on the use and application of section 15(7) DRC, Act, to strike out defense, also made reference to the Supreme Court judgement in Kamla Devi (Smt.) vs. Vasdev, wherein the following observations were made, “It is not obligatory for the Rent Controller to strike out the defense of the tenant under Section 15(7) of the Act if the tenant fails to make payment or deposit. It would depend upon the facts of the case and the discretion of the Controller whether such drastic order should or should not be passed.”