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Ved Rattan And Bros. v. Janak Raj
Judgment Summary — Avadh Behari Rohatgi, J.
Factual and Procedural Background
This is a tenant's appeal arising from an eviction proceeding under the Delhi Rent Control Act, 1958. On March 15, 1976 the landlord, Janak Raj (respondent), issued a notice to the tenant, Ved Rattan Bros (appellants), demanding rent arrears from November 1965 to February 1966 at Rs. 200 per month. The tenant replied on May 16, 1976, alleging that in November 1965 the landlord had forcibly occupied part of the demised premises and removed the tenant's goods, and claimed that the landlord had thereby become disentitled to the entire rent until possession was restored.
The landlord filed an eviction petition on May 21, 1976 alleging non‑payment of rent. During the eviction proceedings the Additional Controller ordered under Section 15(1) that the tenant deposit rent at Rs. 120 per month. In separate proceedings the standard rent was fixed at Rs. 81.25 w.e.f. April 7, 1968.
By Controller's order dated September 20, 1975, the Controller found that the landlord had deprived the tenant of part of the premises and directed deposit of arrears at a reduced rate (Rs. 180 per month instead of Rs. 200 for Nov. 1, 1965 to Apr. 6, 1968; and Rs. 73.25 instead of Rs. 81.25 thereafter). The Controller held that if rent was deposited in those terms the tenant would not be evicted and would be deemed to have enjoyed the benefit of Section 14(2) of the Act. The tenant deposited the arrears in terms of that order.
Two appeals from the Controller's order were taken to the Tribunal: one by the landlord dissatisfied with rent reductions and one by the tenant raising grounds including lack of notice terminating contractual tenancy and entitlement to suspend rent due to partial dispossession. The Tribunal partially allowed the landlord's appeal: it restored the standard rent to Rs. 81.25 (finding the Controller had already taken dispossession into account when fixing that standard rent) but agreed that rent for Nov. 1, 1965 to Apr. 6, 1968 should be reduced to Rs. 180. The Tribunal directed deposit accordingly and stated that if rent were so deposited the tenant would be deemed to enjoy the benefit of Section 14(2). The tenant appealed to the High Court.
Legal Issues Presented
- Has the tenant enjoyed the benefit of Section 14(2) of the Delhi Rent Control Act, 1958?
Arguments of the Parties
Appellant's (Tenant's) Arguments
- The tenant argued that in November 1965 the landlord forcibly occupied a portion of the demised premises (a part of the courtyard) and thereby deprived the tenant of possession of that part.
- Because of this partial dispossession, the tenant contended he was entitled to suspend payment of the entire rent (rather than pay a proportionate share), and therefore was not in default when served with the notice dated March 15, 1966.
- From that premise the tenant argued that, if he was not in default at the time of the notice, he could not be said to have taken the benefit of Section 14(2) when later depositing rent in obedience to Controller's/Tribunal's orders.
- Counsel for the tenant relied upon authorities (N. Basu v. Nilima and Nilkantha v. Kahitish Chandra) which, as cited, support the proposition that in cases of partial dispossession the question of proportionate reduction may not arise because the rent is fixed in lump sum and the lease is indivisible, and equity may require suspension of the whole rent.
Respondent's (Landlord's) Arguments
- The landlord challenged the Controller's reductions: first, that the Controller should not have reduced the agreed rent from Rs. 200 to Rs. 180 for the period November 1, 1965 to April 6, 1968; second, that the Controller should not have reduced the standard rent from Rs. 81.25 to Rs. 73.25 for the period from April 7, 1968 onwards.
- The landlord contested the tenant's plea that no notice terminating contractual tenancy had been served; the Tribunal held that the tenant had waived that point by raising it after more than four years (this point was not pressed before the High Court).
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| N. Basu v. Nilima (as cited) | Holds that where there is partial dispossession by the landlord, the question of proportionate reduction of rent may not arise because rent is fixed in lump sum and the lease is indivisible; small area dispossessed does not prevent application of equity where landlord's act was tortious. | The court noted these authorities as supporting the tenant's contention that partial dispossession can justify suspension of the whole rent on equitable grounds and used them to justify allowing suspension in an eviction context. |
| Nilkantha v. Kahitish Chandra (as cited) | Same principle as N. Basu: partial dispossession may warrant treating rent as not proportionately apportionable and equity may allow relief to the tenant. | Referenced alongside N. Basu to support the proposition that the tenant may suspend rent where dispossession is tortious; the court relied on these authorities to reinforce its equitable approach. |
| Ram Lal v. Dhirendera Nath (as cited) | The Judicial Committee (Privy Council) severely criticised the English doctrine of suspension of rent and refused to apply it in a case where the lessor failed to give possession of part of agricultural land. | The court observed this decision as an instance where suspension was rejected in a recovery suit; it used the decision to explain that prior authorities had rejected suspension in rent recovery suits but had not settled the question for eviction proceedings. |
| Surendera Nath v. Stephen Court Ltd. (as cited) | The Supreme Court held that the tenant is not entitled to suspend rent in a recovery suit but must pay a proportionate part if he enjoys a substantial portion of the property; the tenant's defense of suspension was rejected. | The court distinguished these authorities (which arose in recovery suits) from the present eviction context and noted that the Privy Council and Supreme Court did not decide whether suspension applies to eviction cases; this distinction informed the court's reasoning in favor of applying suspension in eviction proceedings where equity requires it. |
| Chandra Nath Bagchi v. Nabedwip Chandra Dutt (Sir George Rankin quoted) (as cited) | Used for the equitable principle (and a quoted phrase) condemning technical results that pile unreason upon technicality; authority cited to support equitable relief against a tortious dispossession. | The court cited the sentiment/phrase from this authority to justify that it would be unjust and technical to hold a tenant a defaulter where dispossession by the landlord occurred; it supported the conclusion that the Controller should not declare the tenant a defaulter in such circumstances. |
Court's Reasoning and Analysis
The court's analysis proceeded in a series of factual and legal steps strictly tied to findings in the record:
- Fact-finding: The Controller and the Tribunal both made concurrent findings that the landlord had deprived the tenant of a portion of the demised premises (a portion of the courtyard). The court accepted this factual finding as solid and concurrent.
- Legal context and precedents: The court reviewed authorities concerning the doctrine of suspension of rent. It recognised that earlier decisions (Ram Lal; Surendera Nath) had criticised or rejected suspension in the context of suits for recovery of rent, holding that tenants must pay proportionate rent if they occupy a substantial portion. However, the court noted that those decisions expressly did not decide whether the doctrine applies in eviction cases where the landlord seeks to evict for non-payment.
- Difference between recovery suits and eviction proceedings: The court emphasised the practical and legal importance of the distinction. In eviction proceedings, a tenant who is in default after service of notice can be protected by the Act if he pays or deposits rent once (Section 14(2) / Section 15 interplay). But if he defaults a second time, protection ceases. Because Section 14(2) offers a significant protective right to escape eviction once by depositing rent, the court found it necessary to resolve whether a tenant who has been dispossessed from part of the premises can be justly treated as a defaulter for suspending rent.
- Equitable considerations: The court applied principles of justice, equity and conscience. It held that a landlord should not be permitted to obtain full rent and also retain possession of part of the premises — i.e., the landlord cannot profit from his wrongful (tortious) act. While acknowledging the Controller's power under Section 15(1) to order deposit of proportionate rent where the tenant enjoys a substantial portion, the court distinguished that power from the question whether the tenant should be labelled a defaulter for purposes of eviction protection after partial dispossession.
- Application to the present facts: Because both the Controller and Tribunal found dispossession and reduced the rent (from Rs. 200 to Rs. 180 for the relevant period), the court concluded that the tenant was entitled to suspend the entire rent following dispossession and therefore could not fairly be considered in default at the time of the notice of demand. Consequently, when the tenant later deposited rent in obedience to Controller/Tribunal orders, that deposit could not be characterized as the tenant having taken the benefit of Section 14(2).
- Conclusion of analysis: To hold otherwise, the court observed, would blame the tenant wrongly and contradict the concurrent factual findings that vindicated the tenant's claim of dispossession. The court therefore adopted an equitable rule for eviction proceedings: while Controllers may order proportionate rent where appropriate, they should not treat a tenant as a defaulter (for purposes of denying eviction protection) where the tenant has been dispossessed from part of the demised premises and has suspended rent in consequence.
Holding and Implications
APPEAL ALLOWED — The tenant will not be deemed to have taken the benefit of Section 14(2) of the Delhi Rent Control Act, 1958.
Consequences and immediate effects:
- The High Court allowed the tenant's appeal to the extent that it set aside the Tribunal's finding that the tenant had enjoyed the benefit of Section 14(2) by depositing rent pursuant to the Controller's/Tribunal's orders.
- The tenant was held to have been entitled to suspend payment of the entire rent after partial dispossession; therefore he could not be properly characterised as a defaulter for the purposes of attracting the protective provision of the Rent Act against eviction.
- The court left the parties to bear their own costs.
- The opinion confines its reasoning to the case and to eviction proceedings; it does not purport to overrule or broadly change the line of authority in recovery suits where courts have held that tenants must pay proportionate rents when occupying a substantial portion. The decision's practical effect is the direct relief in this case (set-aside of the Tribunal's finding as to Section 14(2) benefit) rather than an assertion of a sweeping new precedent beyond the facts decided.
This summary is derived exclusively from the text of the provided opinion and does not add or infer material beyond that source.
JUDGMENT Avadh Behari Rohatgi, J.
(1) This is a tenant's appeal. The only question in this appeal is : "Has the tenant enjoyed the benefit of Section 14(2) of the Delhi Rent Control Act, 1958) the Act ?
(2) On March 15, 1976 the landlord Janak Raj, respondent issued a notice to the tenant Ved Rattan Bros , appellants in this case demanding arrears of rent from November 1965 to February, 1966 at the agreed rate of Rs. 200 per month in respe (3) On May 16, 1976 the tenant made a reply to the notice. He complained that in November 1965 the landlord had forcibly occupied a portion of the demised premises and removed the tenant's goods there from. He said :
"You have, therefore, become dis-entitled to the entire rent of the premises till vou restore possession".
(4) On May 21, 1976, the landlord filed an eviction petition on the ground that the tenant was in arrears and had not paid rent inspite of service of notice of demand onim. During the pendency of the eviction case the Additional Controller made an order undar Section 15(1) of the Act requiring the tenant to deposit rent at the rate of Rs. 120.00 . Subsequently, in a proceeding launched by the tenant, the standard rent of the premises was fixed at Rs. 81.25 w.e.f. April 7, 1968.
(5) By order dated September 20, 1975, the Controller, holding that the landlord had deprived the tenant of a part of the premises, directed the tenant to deposit within one month the arrears ofrentattherateofRs.l80.00 per month instead of the agreed rent of Rs. 200.00 from November 1, 1965 to April 6, 1968 and at the rate of Rs. 73.25 per month instead of the standard rent of Rs. 81.25 from April ", 1968 onwards. He further held that if rent is deposited in these terms, the tenant shall not be evicted and shall be deemed to have enjoyed the benefit under Section 14(2) of the Act. It is not in dispute that in terms of the Controller's order the tenant made the deposit of the entire arrears of rent.
(6) From this order two appeals were taken to the Tribunal. One was by the landlord and the other by the tenant. The landlord's appeal was that the Controller was in errer in making a reduction of Rs. 20.00 from Rs. 200.00 per month which was the agreed rent in respect of the period November I, 1965 to April 6, 1968. His second complaint was that in respect of the period from April 7, 1968 onvards, the Controller ought not to have made a reduction of Rs. 8.00 from the standard rent which was fixed at Rs. 81.25.
(7) The Tribunal partially allowed the appeal of the landlord. It held that the Controller was not justified in reducing the standard rent from Rs. 81.25 to Rs. 73.25 as the Controller had, at the time of fixing the standard rent, taken the the tenant's plea of dispossession from a part of the demised premises into account , had in fact fixed the standard rent in respect of only that portion of the premises which was actually in the occupation of the tenant. As for the period from November 1, 1965 to April 6,1968 the Tribunal, in agreement with the Controller, held that the rent ought to be reduced from Rs. 200.00 per month to Rs. 180.00 because the landlord had deprived the tenant of a part of the demised premises. In the result the Tribunal, modifying the order of the Controller, directed the tenant to deposit within one month rent at Rs. 180.00 per month from November 1, 1965 to April 6, 1968 and from April 7, 1968 onwards at the standard rent of Rs. 81.25 per month. At the end of the order the Tribunal said :
"INcase the rent is so deposited the ground of non-payment of rent will stand satisfied with the tenant enjoying the benefit of Section 14(2)".
(8) The tenant's appeal against the order of the Controller was mainly on two points. Firstly, he urged that no notice terminating the contractual tenancy was served on him before filing the eviction petition and therefore the petition was not maintainable. Secondly, he urged that he was entitled to suspend rent because he was deprived of a part of the premises. The question of notice regarding the termination of contractual tenancy was decided against the tenant. The Tribunal held that as the plea regarding want of notice was taken after more than four years, it had been waived. This point has not been pressed before me.
(9) Counsel for the tenant has mainly confined himself to the question of suspension of rent. He says that as the tenant was deprived of a portion of the court yard which was a part of the demised premises he was entitled to suspend the entire rent and if it is so, se runs the argument, it cannot be said that the tenant had committed default in payment of the arrears of rent when he was served with notice dated 15th of March 1966. A logical result of this reasoning, it is further said, is that if the tenant was not in default when he was served with notice of demand how can it be held that he, the tenant, had taken the benfit of Section 14(2) of the Act ?
(10) On the question of deprivation of a part of the premises there is a concurrent finding of fact of the Controller and the Tribunal. The Tribunal said this: "SOthe landlord had deprived the tenant of a portion of the courtyard which was part of the demised premises''' Therefore the solid fact remains that the landlord had deprived the tenant of a part of the demised premises.
(11) Counsel for the tenant has referred me to N.Basu v. Nilima, and Nilkantha v. kahitish Chandra, . In these Cases it was held that if there is a partial dispossession by the landlord the question of proportionate reduction of rent does not arise as the rent is fixed in lumpsum and the lease is indivisible. The mere fact that the area dispossessed is a small one is not of an over-riding importance so as to dissuade the court from applying the principles of justice, equity and good conscience if the court finds that the act of the landlord was definitely a tortuous one.
(12) The English doctrine of suspension of rent in its application to India has been the subject of sharp debate. In Ram Lal v. Dhirendera Nath , the Judicial Committee severely criticised it and refused to apply the doctrine to Bengal in a case when the Lesser had failed to give possession to the lessee of part of the agricultural land demised. It came under attack in Surendera Nath v Stephen Court Ltd. . The Supreme Court held that the tenant is not entitled to suspend rent but must pay a proportionate part of the rent if he enjoys a substantial portion of the property of the landlord leased to him. In both decisions the tenant's defense that he was entitled to suspend the payment of rent was rejected.
(13) But both these cases were suits for recovery of rent. The Privy Council as well as the Supreme Court made it clear that they were not deciding that the doctrine of suspension of rent should or should not be applied at all to cases cf eviction of the leassee by the Lesser from a part of the land. In this case it falls for decision whether to apply the doctrine of suspension of rent to eviction cases.
(14) In an eviction case the doctrine of suspension of rent assumes some importance. As in this case if the tenant, after service of notice of demand, does not pay rent he is deemed to be in default. And if he is in default he is protected by the Rent Act once if he makes payment or deposits rent as required by Section 15 of the Act. In the case of second default in the payment of rent he cannot claim the protection of the Rent Act. The tenant is not entitled to the benefit of Section 14(2) if, having obtained such benefit once, he again makes a default in the payment of rent for three consecutive months. The law shows to mercy to a defaulter second time. Such are the strict provisions of the Act.
(15) What is to happen if the landlord in a high handed manner deprives the tenant of a part of the premises demised to him ? Ought the tenant to pay rent or suspend it? If he suspends rent after receipt of notice of demand must he be held a defaulter 7 These questions are of some consequence to the tenant. If he suspends rent and he is held to be in default he can avail of the benefit of Section 14(2) once but not a second time. Section 14(2) gives a valuable right to the tenant to escape eviction by paying or depositing rent as required by S. 15. It means so much to the tenant. Therefore, if the land lord has to rtuously deprived the tenant of a part of the demised premises and the tenant suspends payment of rent if will not be just to condemn him as a defaulter. As the Supreme Court has said :
"IT would be inequitable to allow the plaintiff to recover the full rent when he has not delivered possession of the whole of the premises in question"(Surendera Nath Supra at page 1363).
(16) The landlord cannot get the best of both worlds he cannot get the full rent as well as oust the tenant from the part of the premises. The landlord cannot take advantage of his tortuous act. If he deprives the tenant of a part of the premises leased to him and the tenant does not pay rent the Controller in justice and equity will not hold him in default. The tenant cannot pay proportionate rent. The rent is fixed in lump sum and the lease is indivisible. How is the tenant to apportion the rent ? I am not denying the Controller's power to pass an order under Section 15(1) of the Act. He can make an order taking the conduct of the landlord and the tenant into account. If the tenant has enjoyed a substantial portion of the property of the landlord without much inconvenience it does not stem equitable that he should not pay any compensation for the use of the property. In other words he should enjoy a windfall to use a phrase of Sir George Rankin (Ral lal Supra). Any legal theory which points the terant a right to retain and use another's property without making payment, therefore, has to be condemned. The Controller can order the tenant to pay proportionate rent. But he cannot hold its tenant a defaulter when used for eviction by the landlord, if the tenant is able to establish that he was dispossessed from a part of the demised premises. To so hold would "be merely piling unreason upon tecnicality" to use another phrase of Shri George Rankin. (Chandra Nath Bagchi v. Nabedwip Chandra Dutt .
(17) Applying these principles to the facts of this case I must hold that when the tanant was deprived of a part of the demised premises he was entitled to suspend the entire rent. If it is so the tenant cannot be said to be a defaulter. And if he is not a defaulter it cannot be said that the tenant had enjoyed the benefit of Section 14(2) when he made the deposit in obedience to the order of the Controller and later of the Tribunal in appeal. Both the Controller and the Tribunal found as a fact that the landlord had dispossessed the tenant from a part of the premises, albeit small, and that rent ought to be reduced from Rs. 200.00 to Rs. 180.00 per month. This shows that the tenant's stand was vindicated. He was in the right to hold him a defaulter is to attach blame where there is none. Such a finding is contrary to what the Tribunal and the Controller uniformly found as a fact in favor of the tenant.
(18) For these reasons I allow the appeal and set aside the order of the Tribunal dated February, 9, 1978 to this extent that the tenant will not be deemed to-have taken the benefit of Section 14(2) of the Act. In the circumstances of the case I leave the parties to bear their own costs.
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