Arrears of Rent During Pendency of Litigation: An Indian Perspective

Arrears of Rent During Pendency of Litigation: An Indian Perspective

Introduction

The duty of a tenant to clear outstanding rent and to keep current in payments while eviction or other rent proceedings are sub judice is a recurring theme in Indian landlord–tenant law. Although rent-control statutes across States differ in text, the courts have construed them with striking uniformity: the tenant’s continued possession is contingent upon a dual obligation—payment of (i) pre-existing arrears and (ii) rent accruing pendente lite. Non-compliance not only weakens the tenant’s defence but often furnishes an independent ground for eviction. This article examines the statutory architecture and judicial exposition of that obligation, with special emphasis on Supreme Court precedents such as Atma Ram Properties (P) Ltd. v. Federal Motors (P) Ltd.[1], M.M. Quasim v. Manohar Lal Sharma[2] and the recent decision in Meera Devi v. Dinesh Chandra Joshi[3].

Normative Framework

Rent-control enactments adopt a two-pronged mechanism: (a) immediate remedial opportunity to the tenant by deposit of arrears, and (b) continuous obligation to pay future rent during pendency of trial, appeal or revision. Illustratively:

  • Delhi Rent Control Act, 1958: ss. 15(1)–(7), 25-B(8).
  • Haryana Urban (Control of Rent & Eviction) Act, 1973: s. 13(2)(i).
  • Bihar Buildings (Lease, Rent & Eviction) Control Act, 1947: s. 11(1)(d) & (e).
  • Kerala Buildings (Lease & Rent Control) Act, 1965: s. 12.
  • M.P. Accommodation Control Act, 1961: ss. 12, 13.

Procedural statutes reinforce the framework. Order 41 rule 5 CPC empowers appellate courts to stay eviction decrees on conditions such as payment of mesne profits; Order 41 rule 27 permits reception of subsequent-event evidence affecting rent liability, a power wielded in M.M. Quasim.

Jurisprudential Evolution

1. Supreme Court

Atma Ram Properties crystallised three propositions: (i) after an eviction decree, the statutory tenant becomes an unauthorised occupant for the purpose of rent legislation; (ii) stay of execution is discretionary and may be coupled with a condition to pay mesne rent commensurate with market value; and (iii) such payment alleviates the landlord’s loss while the appellate remedy is pursued[1].

In Vinod Kumar v. Prem Lata[4], the Court read s. 13(2)(i) of the Haryana Act purposively, holding that the Controller must quantify arrears and future rent, thereby eliminating ambiguity and litigation delay. The ruling affirms that the deposit order is a condition precedent for the tenant to contest.

Meera Devi[3] reiterates that even after an interim direction of the Supreme Court, failure to comply with ordered rent payments leads to summary eviction.

Earlier, in Pasupuleti Venkateswarlu and adopted in M.M. Quasim[2], the Court sanctioned consideration of subsequent events, ensuring that arrears liability tracks current ownership and possession realities.

2. High Courts

  • P.K. Periyasamy Nadar v. S. Sakthivel (Madras HC) underscores that deposit of entire arrears mandated by s. 11(4) of the Tamil Nadu Act is compulsory for maintainability of appeal[5].
  • Dwarika Nath Soni v. Bhagwan Dass Gupta (Allahabad HC) conditions stay on monthly deposit failing which decree becomes executable[6].
  • Joy Daniel v. N.A. Ibrahimkutty (Kerala FB) clarifies that s. 12 powers extend even at the appellate stage to insist on arrears deposit[7].

Analytical Themes

Dual Obligation: Past Arrears and Future Rent

The statutory design treats payment of past arrears as a curative measure to purge initial default, whereas payment of rent pendente lite preserves status quo. The Supreme Court in Jamnalal v. Radheshyam[8] meticulously illustrated the chronological segmentation: (a) arrears up to notice of demand, (b) arrears between notice and deposit, and (c) continuing monthly deposit till final disposal.

Condition Precedent for Defence or Appeal

Statutes frequently make deposit of rent a jurisdictional threshold. Section 15(1) of the Delhi Act obliges the tenant, on the very first date of appearance, to deposit rent as directed by the Controller; failure empowers the Controller to strike off the defence, a power echoed in s. 13(6) M.P. Act and affirmed in Savitri Soni v. Benibai[9].

Consequences of Default

Default during pendency provides an additional cause for eviction, distinct from the original ground. The Meera Devi[3] ratio is categorical: a tenant who flouts interim rent orders is liable to immediate eviction. High Courts have, in parallel, refused equitable indulgence when long periods of non-payment are followed by lump-sum deposits at the second appellate stage (Ramshankar v. Madan[10]).

Appellate Discretion and Equitable Compensation

The Supreme Court in Atma Ram Properties aligned appellate stay conditions with equitable restitution, invoking South Eastern Coalfields Ltd. v. State of M.P. to justify reasonable mesne profits. The doctrine is preventive: tenants should not exploit appellate delay to enjoy premises at a historical rent divorced from market reality[1]. Conversely, Mary Beena John v. Addl. Dist. Court[11] holds that when the tenant is not the appellant, s. 29 Mysore Act cannot be invoked to demand pendente lite deposit, marking a statutory limit to the doctrine.

Comparative Statutory Analysis

Although textual variations exist—e.g., the Kerala Act empowers the Rent Controller to stop proceedings, whereas the Delhi Act authorises striking off the defence—the legislative intent is homogeneous: secure the landlord’s monetary interest during litigation and deter dilatory tactics. The Supreme Court’s purposive interpretation in Vinod Kumar harmonises divergent wording by underscoring the Controller-centric determination of arrears, thereby injecting certainty irrespective of State enactment.

Policy Considerations

The delicate balance between tenant protection and landlord’s right to adequate return often tilts when archaic contractual rents persist for decades. The apex Court in Mohammad Ahmad v. Atma Ram Chauhan[12] observed that half of landlord-tenant litigation would dissipate if tenants voluntarily paid rent aligned with contemporary market value, a sentiment reflected in conditional stay orders fixing mesne rent.

Emerging jurisprudence, notably Meera Devi, signals judicial impatience with non-compliance and may foreshadow a stricter stance on pendente lite defaults. Legislative amendment—for instance, a uniform statutory scale for mesne profits pegged to circle rates—could curtail discretionary litigation and promote settlements.

Conclusion

Indian courts have transformed statutory provisions on arrears deposits into a robust procedural filter. The governing principle is that litigation cannot serve as a shield against financial accountability. The tenant’s right to contest is preserved, but only upon faithful discharge of the continuing obligation to pay. Atma Ram Properties equips appellate fora with equitable tools; Vinod Kumar clarifies quantification; and Meera Devi exemplifies swift enforcement. Collectively, the jurisprudence underscores that arrears of rent during pendency are not a collateral matter but lie at the heart of the substantive justice between the parties.

Footnotes

  1. Atma Ram Properties (P) Ltd. v. Federal Motors (P) Ltd., (2005) 1 SCC 705.
  2. M.M. Quasim v. Manohar Lal Sharma, (1981) 3 SCC 36.
  3. Meera Devi (D) thr. LR v. Dinesh Chandra Joshi (D) thr. LRs, S.C. (2024).
  4. Vinod Kumar v. Prem Lata, (2003) 11 SCC 397.
  5. P.K. Periyasamy Nadar & Sons v. S. Sakthivel, Madras HC (1997).
  6. Dwarika Nath Soni v. Bhagwan Dass Gupta, Allahabad HC (2005).
  7. Joy Daniel v. N.A. Ibrahimkutty, 2020 KLT 813 (Full Bench).
  8. Jamnalal v. Radheshyam, (2000) 6 SCC 673.
  9. Savitri Soni v. Benibai, M.P. HC (2024).
  10. Ramshankar v. Madan, M.P. HC (2016).
  11. Mary Beena John v. Addl. Dist. Court, 1986 KLT 595.
  12. Mohammad Ahmad v. Atma Ram Chauhan, (2011) 7 SCC 755.