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Citation Codes
Equivalent Citations
citation codes
Case Number
Attorney(S)
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Acts
  • SECTION 2 BOMBAY RENTS HOTEL AND LODGING HOUSE RATES CONTROL ACT 1947
  • SECTION 10 A BOMBAY RENTS HOTEL AND LODGING HOUSE RATES CONTROL ACT 1947
  • SECTION 7 BOMBAY RENTS HOTEL AND LODGING HOUSE RATES CONTROL ACT 1947
  • provision in Section 13 of the Maharashtra Education (Cess) Act, 1962,
  • provisions of Section 12-7 (a) of the Calcutta Municipal Act, 1923,
  • Bombay Rents, Hotel end Lodging House Rates Control Act, 1947,
  • Section 2 (xiv) of the Cess Act. 9. Section 14 of the Cess Act
  • Section 13 of the Maharashtra Education (Cess) Act, 1962,
  • Sub-section (2). of Section 19 of the Cess Act reads- "(2)
  • provisions of Section 12(3)(a) of the Rent Act.
  • Sub-section (3Y of Section 19 of the Cess Act,
  • sub-section (2) of Section 19 of the Cess Act.
  • Maharashtra Education (Cess) Act, 1962,
  • Section 12(3)(B) of the Rent Act,
  • sub-section (3) (a) of Section 12
  • Section 12(2) of the Rent Act
  • provisions of Section 12(3)(a)-`
  • Section 10-B of the Rent Act."
  • Section 12 of the Cess Act
  • Section 19 of the Cess Act,
  • Section 21 of the Cess Act
  • Section 3 of the Cess Act
  • Section 10 or 10-C
  • Rent Control Act.
  • 1, 1962. Section 8,
  • Section 10-AA
  • Section 10-C.
  • Section 5 M
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Attorney(S)
Judges
Acts
  • SECTION 2 BOMBAY RENTS HOTEL AND LODGING HOUSE RATES CONTROL ACT 1947
  • SECTION 10 A BOMBAY RENTS HOTEL AND LODGING HOUSE RATES CONTROL ACT 1947
  • SECTION 7 BOMBAY RENTS HOTEL AND LODGING HOUSE RATES CONTROL ACT 1947
  • provision in Section 13 of the Maharashtra Education (Cess) Act, 1962,
  • provisions of Section 12-7 (a) of the Calcutta Municipal Act, 1923,
  • Bombay Rents, Hotel end Lodging House Rates Control Act, 1947,
  • Section 2 (xiv) of the Cess Act. 9. Section 14 of the Cess Act
  • Section 13 of the Maharashtra Education (Cess) Act, 1962,
  • Sub-section (2). of Section 19 of the Cess Act reads- "(2)
  • provisions of Section 12(3)(a) of the Rent Act.
  • Sub-section (3Y of Section 19 of the Cess Act,
  • sub-section (2) of Section 19 of the Cess Act.
  • Maharashtra Education (Cess) Act, 1962,
  • Section 12(3)(B) of the Rent Act,
  • sub-section (3) (a) of Section 12
  • Section 12(2) of the Rent Act
  • provisions of Section 12(3)(a)-`
  • Section 10-B of the Rent Act."
  • Section 12 of the Cess Act
  • Section 19 of the Cess Act,
  • Section 21 of the Cess Act
  • Section 3 of the Cess Act
  • Section 10 or 10-C
  • Rent Control Act.
  • 1, 1962. Section 8,
  • Section 10-AA
  • Section 10-C.
  • Section 5 M
Smart Summary

Factual and Procedural Background

The petitioner (landlady) filed a revision petition under Section 29(2) of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947, challenging a judgment and decree of the District Judge, Surendranagar (Civil Appeal No. 101 of 1969) which had dismissed her appeal and confirmed the trial court's decree. Both lower courts had dismissed the landlady's suit for eviction which was founded on alleged non-payment of arrears of rent and of an education cess for a period exceeding six months.

By notice (Ex. 23) the landlady demanded arrears of rent for the period 10-5-1967 to 10-5-1968. The courts treated the tenancy as monthly; the month was held to end on 10-6-1968 and the rent due for that period was Rs. 48. The landlady also claimed an education cess of Rs. 8.40 (calculated at 12 paise per month for 70 months). The tenant sent a money order of Rs. 48 within one month of receipt of the notice (i.e., within the period allowed under Section 12(3)(a) of the Rent Act) but did not initially send the education cess amount (which he later paid).

Legal Issues Presented

  1. Whether the education cess payable in respect of the suit premises constitutes part of the "rent" for purposes of the Bombay Rents Act (i.e., whether it is a "permitted increase" or otherwise forms part of rent recoverable from the tenant).
  2. Whether, assuming the education cess is a part of the rent, that component of the liability is payable "by month" so as to attract Section 12(3)(a) of the Rent Act (i.e., whether arrears of rent including education cess for six months or more were outstanding and thus justified eviction).
  3. Whether the notice (Ex. 23) and the tenant's subsequent payment comport with the statutory requirements (including the one-month period to remit arrears under Section 12(3)(a)), and whether the tenant thereby obtained protection under Section 12(3)(b) of the Rent Act.

Arguments of the Parties

Petitioner-Landlady's Arguments (as advanced by Mr. Suresh M. Shah)

  • The education cess payable in respect of the premises is part of the rent and constitutes a permissible increase recoverable from the tenant.
  • The tenancy was monthly and the standard rent (Rs. 4 per month, leading to Rs. 48 for the period identified) was payable by month; an increase attributable to the education cess (borne by the landlord and capable of being passed on) should similarly be regarded as rent payable by month.
  • Section 7 of the Rent Act does not prevent such an increase; authorities (including decisions of the Supreme Court) support the view that permitted increases (including taxes/cess) become part of the rent.
  • Authorities such as Gauri Shankar Chittarmal Gupta v. Gangabai Tokersey and Bombay Municipal Corporation v. LIC were cited to support the proposition that permitted increases (including municipal taxes/cess) can be included in monthly claims of rent and arrears.

Opponents-Tenants' Arguments (as advanced by Mr. Raval)

  • The demand for education cess could not be treated as a demand for part of the rent payable by month; thus Section 12(3)(a) (eviction for arrears of rent for six months or more) would not be attracted in respect of the cess component.
  • Reference was made to Nathusingh Vardhisingh v. Raval Markandrai Chunilal (Desai, J.) to contend that Section 10 (permitted increases for taxes) applies only where there was an existing liability on the landlord that increased; where there was no such existing liability, Section 10 would not apply.
  • The landlord in the present case was, in effect, only a collecting agency for the education cess (i.e., not primarily liable to pay it in the sense required by Section 10), so the cess demand should not be equated with a monthly rent component.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
P. Mbhanlal v. Maheshwari Mills Ltd., (1962) 3 Gui LR 574 Consideration of whether components described as rent were payable by month; cited for proposition that if part of rent is not payable by month Section 12(3)(a) may not apply. The District Judge relied on this decision to conclude the education cess was annual (not payable by month) and therefore s.12(3)(a) of the Rent Act was not attracted. The present Court relied on the same reasoning to hold that the cess component was not shown to be payable by month.
Gauri Shankar Chittarmal Gupta v. Smt. Gangabai Tokersey, AIR 1971 SC 659 Authority on claiming arrears of rent including permitted increases (municipal taxes) and on the proper content of notices claiming arrears; illustrates that where parties have treated municipal tax as payable monthly, it can be part of monthly rent claims. Cited by petitioner. The Court observed this decision could not be pressed into service to prove monthly liability here because, in that case, the tenant had expressly admitted municipal tax was payable monthly; accordingly, the decision was not directly on point for the question whether part of rent which was statutory (education cess) was payable by month.
Bombay Municipal Corporation v. The Life Insurance Corporation of India (Bombay), AIR 1970 SC 1584 Discussion of definitions in the Rent Act (standard rent, permitted increases) and recognition that permitted increases (including taxes/cess) are treated by statute as part of rent for certain purposes. The Court relied on the observations in this decision to support the submission that payment or liability to pay education cess would be regarded as part of the rent (i.e., a permitted increase).
Corporation of Calcutta v. Smt. Padma Devi, 1962-3 SCR 49 = AIR 1962 SC 151 Principle that the criterion for valuation/annual value is the rent realizable by the landlord, and that permitted increases should be considered in determining valuation. Quoted in support of the view that permitted increases (including education cess) form part of the rent realizable and thus must be taken into account for valuation; used to support notion that cess is part of rent.
Patel Gordhandas Hargovindas v. Municipal Commissioner, Ahmedabad, 1964-2 SCR 608 = AIR 1963 SC 1742 Described modes for determining annual or ratable value and supported taking actual rent (including permitted increases) as basis for valuation. Used to show that actual rent realizable in the present case comprises standard rent plus permitted increase (education cess), supporting that cess is part of rent for valuation/recovery purposes.
Nathusingh Vardhisingh v. Raval Markandrai Chunilal, 1973 Rent J 276 (Guj.) Interpreted Section 10 of the Rent Act as covering cases where there was an existing liability to pay a tax or where such liability had increased. Cited by respondent. The Court relied on the reasoning to note that Section 10 does not apply where there was no existing liability (i.e., where the liability to pay tax arose later) and thus distinguished some factual scenarios from the present case.
Smt. Muktabai Gangadhar Kadam v. Smt. Muktabai Laxman Palwankar, (1969) 71 Bom LR 752 Held that education cess payable by an occupant under the Maharashtra Education (Cess) Act, 1962, is part of "rent" within the Rent Act and, when claimed in addition to contractual rent, constitutes a "permitted increase". Referred to as a supporting decision; the Court found this authority persuasive and consistent with the conclusion that education cess, when payable by the occupier, is part of the rent.

Court's Reasoning and Analysis

The Court proceeded methodically through statutory provisions, factual findings and precedent:

  1. Starting point: both lower courts had found a monthly tenancy and that the contractual standard rent component (Rs. 4 per month, aggregating to Rs. 48 for the period identified) was payable by month; the District Judge concluded Section 12(3)(a) of the Rent Act would not apply to the education cess because the cess could not be said to be payable by month, relying on P. Mbhanlal v. Maheshwari Mills Ltd.
  2. The petitioner argued the education cess constituted part of the rent as a permitted increase and that Section 7 did not bar recovery; she relied on Supreme Court authorities (Gauri Shankar; Bombay Municipal Corporation v. LIC) to support that permitted increases (taxes/cess) are to be treated as part of rent.
  3. The Court examined the statutory framework governing the education cess (the Gujarat Education Cess Act and its provisions). The Court noted:
    • Section 12 of the Cess Act is a charging section;
    • Section 3 imposes the education cess as a surcharge/tax on lands and buildings;
    • Section 19(1) grants a person who pays the tax (if not the occupier) the right to recover it from the person in actual occupation; Section 19(2) permits pro rata recovery where the building consists of more tenements; and Section 19(3) provides that recovery of tax under that section shall not be deemed an "increase" for the purposes of Section 7 of the Rent Act.
    • Section 21 of the Cess Act provides that sums recoverable under Section 19 are recoverable by the same rights and remedies as if they were rent payable.
    On that statutory basis the Court concluded the landlady was entitled to recover the education cess from the occupier (the tenant) and that statutory provisions and relevant Supreme Court decisions support treating the cess as part of the rent (i.e., a permitted increase or an amount recoverable as if it were rent).
  4. However, the decisive question was temporal: whether that statutory component (education cess) was payable "by month" so as to bring the case within Section 12(3)(a) of the Rent Act (eviction for arrears of rent for six months or more). The Court observed the landlady's notice (Ex. 23) itself distinguished contractual rent arrears from the education cess demand; the notice sought cess for a long period (70 months) at a specified monthly rate but did not assert any agreement that the tenant was bound to pay the cess monthly. The Court also noted evidence that local authorities levy such tax quarterly, half-yearly or annually rather than monthly.
  5. The Court relied on the reasoning in P. Mbhanlal (Bhagwati, J.) that where rent consists of two parts and one of those parts is not payable by month, the aggregate "rent" cannot be said to be payable by month and therefore Section 12(3)(a) will not apply. Applying that principle, the Court held that simply because the standard rent was payable monthly it did not follow that the statutory cess component was likewise payable by month in the absence of any agreement or evidence to that effect.
  6. Conclusion of analysis: although the education cess is recoverable from the tenant and, in substance, forms part of the rent (or is recoverable as if it were rent), the petitioner failed to establish that this component was payable by month. Therefore the arrears claimed did not satisfy the condition of being "rent payable by month" in the sense required for invoking Section 12(3)(a). The tenant had complied with the one-month period applicable under the subsection relevant to his case (i.e., the tenant satisfied the statutory conditions entitling him to protection under Section 12(3)(b)), and the eviction decree could not be sustained.

Holding and Implications

Holding:

REVISION PETITION DISMISSED.

Direct consequences for the parties (as stated in the opinion):

  • The judgment and decree of the lower courts dismissing the landlady's suit for eviction are affirmed; the suit was rightly dismissed against the opponent-tenant.
  • The tenant, having complied with the statutory conditions applicable to his case, was entitled to the protection under Section 12(3)(b) of the Rent Act (i.e., eviction could not be granted under Section 12(3)(a) because the cess component was not shown to be payable by month).
  • The revision petition fails; the rule is discharged; each party is ordered to bear its own costs in the revision petition.

Broader implications: the opinion affirms that education cess (when payable by an occupier by virtue of statutory provisions) can be treated as a part of rent or be recoverable as if it were rent, but it also emphasizes that to invoke the eviction provision for arrears payable "by month" the claimant must show that the contested components are in fact payable monthly. The opinion does not purport to lay down any broader new legal principle beyond the application of existing statutory provisions and authorities to the facts of the case.

    Vanlila Vadilal Shah v. Mahendrakumar J. Shah And Another Opponents.

    1. This is a revision petition filed by the petitioner-landlord under Section 29(2) of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 (which will be hereinafter referred to as "the Act"), against the judgment and decree passed by the learned District Judge, Surendranagar in Civil Appeal No. 101 of 1969, dismissing the petitioner's appeal and confirming the judgment and decree passed by the learned trial Judge.

    2. Both the Courts below have dismissed the petitioner-landlady's suit for eviction which was claimed on account of non-payment of arrears of rent and education cess for a period aver six months. By suit notice, Ex. 23, demand of arrears of rent for the period between 10-5-1967' and 10-5-196,8 was made. That was the rent which could be claimed as found by the two Courts below. She was not entitled to rent up to 27-5-1968 on the date of the notice as it was broken portion of the month. It was a monthly tenancy and she was entitled to get rent at the, end of the month. The month ended on 10-61968. That amount came -to Rs. 48. The petitioner-landlady had further claimed education cess of Rs. 8.40 paise. 0-oponent-tenant had sent money order - of Rs. 48 within the period of one month from the date of the receipt of the notice. He had not sent the aforesaid educationcess amount, but he had paid it later on.

    3. The learned District Judge came to the conclusion that sub-section (3) (a) of Section 12 of the Act would not be attracted as part of the rent, namely by the education cess, could nut be said to be payable by month, relying upon the decision of this Court P. Mbhanlal v. Maheshwari Mills Ltd., (1962) 3 Gui LR 574; he came, to the conclusion that the by education cess was an annual cess. Therefore, although defendant No. 1 was an a monthly tenant and so far as the rent and of Rs. 4 per month was concerned, it of was payable by month, the education cess payable by him was not payable by to month. . In that view of the matter, section 12(3)(a) of the Act was not attracted Taking that view of the matter, he reached the conclusion that the decree for eviction cannot be passed against the opponent-tenant under section 12(3)(a) of the Act.

    4. Mr. Suresh M. Shah, appearing for the petitioner-landlady, has urged that payment of education cess in respect of the suit premises is also a part of the rent. The two Courts below, on consideration of the evidence, have reached the conclusion that there was monthly tenancy and the rent of Rs. 4 in respect of the suit premises was payable by month This increase in rent is permissible on account of payment of education cess by the landlady who is primarily liable and the tenant is bound to pay, such an in crease in the rent is permissible and Section 7 of the Act does not come in the way of the landlady. It should therefore be taken to be rent payable by month. It could not be that part of the rent in respect of the suit premises is payable by month and -part of it is not payable by month.

    5. In support of his argument, Mr. Shah has invited my attention to the decision of the Supreme Court in Gauri Shankar Chittarmal Gupta v. Smt. Gangabai Tokersey, AIR 1971 SC 659. Short question that arose for consideration for the Supreme Court was, whether the High Court was justified in holding that the respondent landlady was entitled to seek eviction of the appellant on the ground that the latter had failed to pay the standard rent including the permitted increases for over a period of six months. At page 661, in para. 3, it is observed:

    "It will be noted that in this notice the respondent claimed arrears of rent including the amount of increment in municipal taxes and that the total amount per month was at Rs. 52-9-6. Claim by way of arrears of rent including the in crements in municipal taxes was for a period of five months from December 1, 1954 to April 30, 1955,' and compensation was further claimed for one month. The appellant again sent a reply through his counsel on July 1, 1955. In this reply he had stated, that the claim contained in the notice dated June 15, 1955 was very much in excess of what was actually due by him. It was further stated that the monthly rent of the premises was only Rs. 45 and that the municipal 'tax recoverable was also only Hs. 2-13-0 per month. He, power, admitted that from April 1, 1954 there Was an addition to the rent according to law, but he stated that he has paid rent at Rs, 48-2-9 including all taxes from April 1, 1954.

    It is thus evident that in that case the tenant also had in terms stated that the monthly rent of the premises was Rs. 45 and that the municipal tax recoverable was only Rs,. 2-13-0, per month. It, therefore, clearly means that there was an agreement to pay the municipal , tax also per month. In that municipal tax there was increase which was claimed by the landlord. It was having regard to those facts and circumstances that the Supreme Court has observed at page 664 in para. 14:-

    "Even otherwise if the appellant was in any manner of doubt on this point or required any clarification from the respondent, normally, he should have called for information on those points especially when he was sending replies through a lawyer to the notices issued by the respondent. Excepting baldly saying that the claim was excessive, he never cared to ask for any particulars. The appellant must have been well aware that the stranded rent in this case is Rs. 45 per month and increase not exceeding 71% under Section 10-C. Further, he must also be well aware that the respondent was further entitled to claim increases on -account of payment of municipal taxes to a local authority under Section 10 of the Act. That the appellant was well aware of this is clear from his reply dated July 1, 1955 wherein he has stated that the municipal tax is only Rs. 2-13 annas and that he has been paving the same to the Receiver. That the increases that the respondent was entitled to get under Sections 10 and 10-C were Rs. 4-3 annas and 6 p. and Rs. 3-6 annas respectively. is not challenged. Adding these two items to the standard rent of Rs. 45 it follows that the total monthly amount claimed in the sum of Rs. 52-9 annas 6 ps. was perfectly correct."

    It is further observed in para. 15:-

    "........ So far as we could see there is nothing in law to prevent the landlord making the increase at the time of giving' the notice. section 12(3)(a) itself gives the tenant a period of one month for complying with the demand for arrears of rent for. a period of six months or more and it is only if the amount is not Paid within that period, the landlord Is entitled to file a suit. There is nothing in the Act which requires a landlord to give first a notice under. Section 10 or 10-C and then a further notice under Section U, In this case, the landlord has given a notice on June 15, 1955 calling upon the appellant to pay the arrears due from December 1, 1954. There is no controversy that the amount was not paid till the institution of the suit. When that is so, it follows that the appellant was in arrears for a period of six months or more and that he had further neglected, to make the payment until the expiration of one month after the notice, dated June 15, 1955."

    This decision, therefore, cannot be pressed into service as that decision had not to consider any question whether part of the rent was not payable by month. As said earlier, even the tenant said that amount of Rs. 2-13 annas, which amount was the original municipal tax, was payable by month-

    6. Mr. Shah has also invited my attention to the decision of the Supreme Court in the Bombay Municipal Corporation v. The Life Insurance Corporation of India, Bombay, AIR 1970 SC 1584. After referring to the definition of the "Standard rent" in Section 5(10) of the Act and definition of "permitted increases" in Section 5(7) of the Act and the definition of the word "landlord" given in Section 5(3) and "tenant" given in Section 5(11) of the Act, following observations at page 1585 have been made:-

    "........ Section 7 -provides for increase in rent on account of improvements or structur4l alteration of the premises which have been made with the consent of the tenant and such increase is not to be deemed an increase for the purpose of Section 7. Under Section 10 a landlord can increase the rent on account of Payment of rates, cess or taxes imposed an& levied by a local authority. Such an in crease again is not to -be deemed to be an increase for the purpose of Section 7. Similarly under Section 10-AA the land lord can increase the rent on account of payment of enhanced rates etc. permitted after certain date in particular areas. Any increase in this section cannot be deemed to be an increase for the purpose of Section 7.

    The High Court was alive to the fact that the mention of increase in sections 10, 10-a and 10aa referred to increases in rent but it was felt that the section in express terms provided that such an in crease shall not be deemed to be an increase in rent under Section 7. According to the High Court it followed that what was allowed to the landlord in addition to the standard rent was not an increase in the rent but a provision was made in a specified way for the transfer of the burden of the tax to the tenants because of the rigours of the Rent Act. The other factor which weighed with the High Court was that if the increase in rates was to be treated as a Part of the rent which would enable the Municipal Corporation to increase the valuation on every occasion when there was increase in rates and taxes this would 'Land, - us again into a cycle of increments every year from figure to figure never intended by the framers either of the Rent Act or of the Municipal Act'."

    After referring to such view taken by the 114ah Court and after referring to 1~iaterial S. 7 of the Act, at p. 1586. the relevant observations made in para 6 are:-

    "It is quite clear that Section 7 does not prohibit the recovery of the increase to which landlord may be entitled under the provisions of the Act in addition to the standard rent. The obvious implication of the definition of 'Permitted in crease' in Section 5 M is that such an increase becomes a part of the rent. The language which has been employed in Sections 9, 10 and 10AA seems to indicate that the legislature treated the permitted increase as a part of the rent which the landlord would be entitled to receive from the tenant. In Corporation of Calcutta v. Snit. Padma Devi, 1962-3 SCR 49 = (AIR 1962 SC 151) the question arose whether the Municipal Corporation had the power to fix the annual valuation on a figure higher than the standard rent. It was held that on a reading of the provisions of Section 12-7 (a) of the Calcutta Municipal Act, 1923, the rental value could not be fixed higher than the standard rent under the Rent Control Act. it was further held that the words 'gross annual rent at which the land or buildings might at the time of assessment reasonably be expected-to let from Year to year' in Section 127 (a) implied that the rent which the landlords might realize if the house was let was the basis for fixing the annual valuation of the buildings.

    Thus the criterion was the rent realizable by the landlord and not the valuation of the holding in the hands of the tenant. Even applying that criterion the rent realisable, in the present case, would be the standard rent together with the permitted increase on account Of the levy of education cess. As observed in Patel Gordhandas Hargovindas v. Municipal Commissioner

    " Ahmedabad, 1964-2 SCR 608 == ( AIR 1963 SC 1742) there are three modes of determining the annual or ratable value of -lands or buildings. The first is the actual rent fetched by the land or buildings where it is actually let. The second is rent based on hypothetical tenancy where it is not let and the third is by valuation based on capital value from which -the annual value has to be found by applying a suitable percentage, where either o f the first two modes is not available. In the present case admittedly the actual rent of the building in question which is being fetched comprises the standard rent and the permitted increase. The building can well be said to be reasonably expected to be let from year to year at -the figure arrived at by adding the permitted increase to the standard rent. The valuation had, therefore, to be arrived at after taking into account the amount of educational cess which was levied by the Corporation. Even if such a conclusion leads to some kind of inconvenience of variation in valuation -at frequent intervals that can be no consideration for not giving full effect and meaning to the provisions of the Act of 1888 .and the Rent Act under consideration."

    This decision only lends support to the submission made by Mr. Shah, that payment of such education cess or the liability to pay it, would be in respect of a part of the rent.

    7. No doubt, Mr. Raval, appearing for the opponents-tenants, has stated that such payment of education cess. and such demand could not be said to be a demand of Part of the rent. In my opinion, this is not a well founded argument. Mr. Raval has invited my attention to the decision of my learned Brother D. P. Desai, J. in Nathusingh Vardhisingh v. Raval Markandrai Chunilal, 1973 Ren tJ 276 (Guj.). 'Me relevant observations made therein are:-

    "Section 10 of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947, provides for increase in rent not exceeding the increase paid by the landlord by way of such rate, cess or tax over the amount paid in the period of assessment which included the date of coming into operation of this Act or the date on which the premises were first let, whichever -is later. The phrase 'over the amount paid', in the prescribed period, whichever is applicable, also emphasises the fact that there must be an existing liability of payment of rent cess or tax during the prescribed period which liability may have been increased subsequently. The phrase "increase paid by him by way of such rate, ces.5 or tax" also shows that the payment made by the landlord to the local authority must be of an increased payment which pre-supposes the lesser payment under the original liability which has been increased. The word "increased" is very suggestive of the fact that the legislature provided for passing on the burden of an increase in the existing liability of the landlord in respect of rate, cess or tax to the tenant. Where, therefore, there was liability on the landlord to pay any rate, cess or tax, as in the present case, no question of increase in the liability arises: and if there is no increase in the liability contemplated by Section 10 of the Act, the said section is not applicable."

    In that case, certain areas were brought within the limits of municipal corporation with effect from 13-8-1958. There was, therefore, no existing liability to pay any municipal tax. Liability arose when those areas were brought within the limits of the Municipal Corporation, and my learned Brother D. R. Desai, J., had to consider the wording of Section 10 of the Act and on consideration of the wording of it, reached the conclusion that that section will cover the case where there was already existing liability to pay the~ municipal tax. If there was increase made, it would be permitted increase under Section 10. Present case will not also be covered by section 10 of the. act, as in the instant case, the landlord is not required to pay to the local -authority in respect of the premises the education cess for the purpose of such authority. It is only the collecting agency. But we have, in the Gujarat Education Cess A ' ct, 1962 (which will be hereinafter referred to as "the Cess Act") itself, certain provisions which would undoubtedly point to the conclusion that such payment would be in respect of a part of the rent -and it will not be considered to be an increase in rent so far as Section 7 of the Act is concerned.

    8. Section 12 of the Cess Act is, a charging section. section 2 (1) defines It annual letting value". Secti6n 2 (4) defines "education cess", as under:-

    " 'education cess, means a surcharge or tax on lands and buildings levied under this Act."

    "Surcharge" has been defined in Section 2 (xi), "tax" has been defined in Section 2 (xii) and "tenement" has been defined in Section 2 (xiv) of the Cess Act.

    9. Section 14 of the Cess Act deals with "primary responsibility for -tax an lands and buildings". Section 3 of the Cess Act reads:-

    "For the Purpose of providing for the cost of promoting education in the State of Gujarat, there shall be levied and collected in accordance with the provisions of this Act ~n education cess, which shall consist of-

    (a) a surcharge on all lands . except lands which are included within a village site and not assessed to land revenue;

    (b) a tax on lands -and buildings in urban areas."

    It is, therefore, evident that this tax collected by the local authority is not for the Purpose of the authority.

    10. Section 19 of the Cess Act, which is material. for our purposes, reads:-

    "19 (1) If any person from whom under the provisons of Section 12 the tax is livable pays the tax in respect of any land or building, he shall if he be not himself in occupation thereof during the period for which he has paid the tax, be entitled to recover the amount of the tax from the person, if any, in actual occupation of such land or building for such period."

    It is, therefore, evident that the landlady is entitled to recover such tax paid by her in respect of the suit premises in occupation of the opponent-tenant,

    11. Sub-section (2). of Section 19 of the Cess Act reads-

    "(2) Where tax is paid in respect of -any building consisting of more tenements has one, by the -person primarily liable or on his behalf, he shall be entitled to recover, from the occupiers of the tenements the amounts paid Pro rata to the -amount of rents for which such tenements are let."

    Present case is -a case falling within the purview of that sub-section (2) of Section 19 of the Cess Act. Proviso to it reads:-

    "Provided that, no such recoveries shall be made in at page 754, it is observed:

    "......... The trial Court further held that i*he dispute relating to 'education cess' was not a dispute relating to a 'permitted increase' and hence, though the petitioner had complied with the requirements of Section 12(3)(B) of the Rent Act, she was not entitled to the protection of that section. According to that curt as the rent was in arrears for over six months, the case was governed by the provisions of Section 12(3)(a) of the Rent Act. It, however, held that the notice did not satisfy the requirements of Section 12(2) of the Rent Act inasmuch as the amount demanded therein was in excess of the amount due, and, on that ground alone, dismissed the suit directing that the opponents should withdraw the amount deposited in Court by the petitioner and that the parties should bear their respective costs.

    On appeal by the opponents, the appellate Court reversed the finding of the trial Court on the question of validity of the notice but confirmed the finding that 'education cess' was not a 'Permitted increase' under the Rent Act, and the dispute relating to the same would not, therefore-take the case out of the provisions of Section 12(3)(a)-` After referring to the expression 'permitted increase' defined in Section 5(7) of the Act, it is observed:

    "The term 'rent, is not defined in the Rent Act and it would be reasonable, therefore, to -suppose that it has been used in its ordinary dictionary meaning. According to the Oxford English Dictionary. 'Rent' means the return or payment made by a tenant to the owner or landlord, at certain specified or customary times, for the use of lands or houses"
    .

    This is comprehensive enough to include all items of periodical payment which a tenant is liable to make-to his landlord for the occupation of the premises. whether under the contract of tenancy or by virtue of a statutory -provision. There is ample judicial authority for holding that where the term 'rent' has not been specially defined, it should be given this wider meaning.' In support of his conclusion, Bal, J., has referred to several English decisions and observed at page 756:

    "The cases referred to above deal with contractual payments but there is no reason why the same principle should not apply to payments which the tenant is required to make to his landlord by virtue of statutory provisions when the liability to make those payments arises on account of the tenant's use and occupation of the premises let to him. This view receives support from the -provisions of Section 10-B of the Rent Act."

    After referring to that section it is observed:

    "........Section 10-B does not, however, say that the landlord shall be entitled to make -an increase in the rent of the premises on account of payment by him of the riot tax but only provides that the recovery of the amount 'shall not be deemed to be an increase for the purposes of section 7' and section 7. as we shall -presently see, prohibits only an increase 'on account of rent' above the standard rent.

    The 'education cess' which is the subject of controversy in the present case is a tax levied and collected under the Maharashtra Education (Cess) Act, '1962 (Maharashtra Act No. XXVII of 1962). Section 4 (a) of the Act provides for the levy and collection of that tax on lands and buildings in Municipal Areas at the rate of two per cent. of the annual -letting value (or 'rateable value') of such lands or buildings with effect from October 1, 1962. Section 8, in effect, casts the 'primary responsibility for the payment of the tax on any land or building on the owner thereof (other than the Government or a Local Authority) irrespective of whether he is the actual occupier thereof or not. Section 13 then provides that on payment of the amount of the tax in respect of any land or building, the owner shall be entitled to receive that amount from the person, if any, in actual occupation . of such land or building during the period for which he has paid the tax. 'Section 14 provides for cases where the land or -building assessed to the tax is let but the ratable value exceeds the rent which the landlord, receives from the tenant. The net effect of the provisions of 'Sections 13 and 14 is to ultimately transfer the entire burden of the tax to the actual occupier or occupiers.

    Section 15 which follows reads:

    'Any person entitled to receive any sum under section 13 or 14 shall have for the recovery thereof, the same rights and remedies as if such sum were rent payable to him by the person from whom he is entitled to receive the same'."

    In our -Cess Act the corresponding section is Section 21 which is in pari materia with it. At page 757 Bal, J., has-observed:

    "The actual occupier of a land or building may not necessarily be the tenant of the owner thereof and the section had, therefore, to be worded in general terms: but for the recovery of the amount of the Education Cess from him, the section provides the same rights and remedies as if the amount were rent payable by him to the person entitled to receive the same irrespective of whether the occupier is or is not the tenant. Where the premises in his occupation are governed by the Rent Act, a suit for the recovery of the Education Cess from the occupier must, therefore, be brought in the Special Court established under that Act and in such a suit the plaintiff and the defendant must be regarded as the landlord and the tenant respectively. If then the premises -are let, so that the occupier is a tenant liable to pay rent to his landlord, it can be safely concluded -that the amount of education cess which is payable by him by virtue of the statutory provision in Section 13 of the Maharashtra Education (Cess) Act, 1962, is part of the 'rent' within the meaning of that term as used in the Rent Act and when claimed in addition to the contractual or standard rent constitutes an 'increase in rent'."

    He has, thereafter considered the relevant provisions of the Act and reached the conclusion that it is a permissible increase under the provisions of the Act. In my opinion, that decision lays down the correct ratio. I -am in agreement with it and I feel no hesitation in reaching the conclusion that this education cess, which ultimately becomes payable by the tenant, is a part of the rent. It is not on account of -any contract, but it is on -account of the statutory provisions of the Act.

    (respect of-

    (a) any tenement in occupation of such person or any Person acting on his behalf, or

    (b) any tenement the tax on which by the terms of the tenancy, such Person has agreed to Day its occupier."

    It is not suggested that the instant case falls within the purview of that proviso.

    12. Sub-section (3Y of Section 19 of the Cess Act, which is the most material sub-section for our purposes, reads

    "(3) The recovery of any amount of tax from an occupier under this sect-on shall not be deemed to be an increase for the purposes of Section 7 of the Bombay, Rents, Hotel and Lodging House Rates Control Act, 1947 (Bom. LVII of 1947), or any law corresponding thereto."

    This sub-section clearly indicates that such recovery will not be deemed to be an increase in the rent within 'he meaning of Section 7 of the Act. Mr. Shah is, therefore, justified in subrnittin2 that this will be a permitted increase. The Supreme Court -also. in the decision cited by him, has taken the same view.

    13. Section 21 of the Cess Act reads:

    "Any person entitled to recover any sum under Section 19 or 20 shall have for the recovery thereof, the same rights and remedies as he would have if such sum were rent payable to him by the person from whom he is entitled to receive the same."

    It further -indicates that this would amount to a part of the rent payable by the tenant to the landlord.

    14. A Single Judge of the Maharashtra High Court had an occasion to decide a similar question in Smt. Muktabai Gangadhar Kadam. v. Smt. Muktabal Laxman Palwankar, (1969) 71 Born LR 752. In the Maharashtra Education (Cess) Act, 1962, there was also similar provision as contained in the Cess Act. Bal, J. has observed:

    "Education cess payable by an occupant by virtue of Section 13 of the Maharashtra Education (Cess) Act, 1962, is part of the 'rent' within the meaning of that term as used in the Bombay Rents, Hotel end Lodging House Rates Control Act, 1947, and when claimed in addition to the contractual or standard rent constitutes a 'permitted increase' as defined in Section 5(7)of the latter Act."

    15. The important question that survives for consideration is, whether such liability of payment of education cess, which is deemed to be a part of the rent, was payable by month. In the instant case, it is not suggested that there was any such agreement to pay such educational cess levied in respect of the suit premises, by the tenant every month. If we refer even to the notice given by the landlady, which is at Ex. 23, she makes a clear distinction between the arrears of rent demanded and the education cess demanded.. In para. 3. she states-

    "That you are not paying rent regularly. You are in arrears of rent from Vaishakh Sudi Ekam of Sanivat Year 2023 to Vaishakh Vadi Amas of Sanivat Year 2024 for 13 months which comes to Rs. 52. Therefore, you being in arrears for more than six months my client is entitled to recover possession of the suit premises from you on that ground. That Rs. 4 is the standard rent."

    In para. 4. she refers to this demand for the educational cess amount paid by her which she, is entitled to recover under the provisions of the cess act from the occupier, viz. the opponent-tenant- She states :

    "That education cess is applied to the suit tenement. Therefore, you are liable to pay the same from 1-8-1962 to 31-5-1968 for 70 months at the rate of 12 paise which comes to Rs. 8.40 paise. My client is entitled to recover the same from you under the law."

    This is the first time that the demand is made for such educational cess in respect of the suit premises which the landlady paid sometime in year 19,67. She has, no doubt, stated that the rate would be Re. 0.12 paise per month, and at that rate she has claimed arrears for 70 months and that amount came to Rs. 8.40 paise. There is no mention made that there was any agreement to pay this part of the rent every month which would be deemed to be a part of the rent, as stated by me above, in view of the statutory provisions of the Act. Admittedly, such tax is not levied monthly by local authorities. It is stated that it is levied quarterly, or half yearly, and by some Authorities annually. There is no evidence also suggesting any such agreement. It cannot, therefore, be said that this part of the rent was payable by month. Simply because Rs. 4 were payable by month, it need not be and cannot be concluded that this part of the rent which was payable under the statutory provisions was payable by month. Mr. Shah has not been in a position by reliving upon any decision to support that conclusion of his.

    16. In (1962) 3 Gui LR 574, at p. 591 Bhagwati, J. 6as he then was) has observed :

    "That -brings me to the last branch of the contention of Mr. M.P. Amin that the rent of the premises was not payable by the month as required by sub-section (3) (a) of Section 12 and that the case did charged. not, therefore, fall within the scope and purview of that sub-section. This contention was put by Mr. M. P. Amin in the following form. Mr. M. P. Amin contend ed that the rent of the premises was not only the sum of Rs. 326 P. in. as provided in clauses (1) and (3) of the Deed of Lease but it also included municipal taxes, property taxes and Government taxes in respect of the premises which were payable by the defendant to the plaintiffs under clause (9) of the deed of lease. The rent of the premises. according to Mr. M. P. Amin, consisted of two parts, one part being the sum of Rs. 326 u. in. payable by the defendant to the plaintiffs in advance on or before the 5th day of every month and the other Dart being the amount of municipal taxes,property taxes and Government taxes in respect of the premises payable by the defendant to the plaintiffs. Both the parts, argued Mr. M. P. Amin, constituted rent of the premises since they were payable by the defendant to the plaintiffs for the use and occupation of the premises. Mr. M. P. Amin contended that though the first part might be payable by the month. the second part was not payable by the month and that it could not. therefore, be said of the rent, which consisted of both the parts, that it was pay able by the month: and if it could not be said a . f the rent that it was payable by the month, then obviously sub-section (3) (a) of Section 12 could not apply. There :s, in my opinion, great force in this contention of Mr. M. P. Amin."

    In view of this decision of this Court, there is no merit in the submission made by Mr. Shah that ' if r)art of the rent is payable by month, the other part of the rent should be presumed to be pavable by month.

    17. The net result, in view of the aforesaid decision, is that in the instant case it cannot be said that the rent was payable by month so that the provisions of section 12(3)(a) of the Act were attracted. The learned District judge was justified in reaching the conclusion that the present case will not fall within the purview of section 12(3)(a) of the Act. but 1, falls within the purview section 12(3)(a) of the Act. Tenant has admittedly complied with the conditions of that sub-section and was, therefore, entitled to protection under Section 12(3)(B) of the Act. The suit has been rightly dismissed against the opponent-tenant. The revision petition, therefore, fails.

    18. Revision petition is dismissed, Looking to the -circumstances of the case, each party is ordered to bear its own costs in this revision petition. Rule is discharged.

    19. Petition dismissed.

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