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Acts
  • Section 13 of the East Punjab Rent Restriction Act
  • Transfer of Property Act, Section 17 of the Registration Act
  • Section 107 of the Transfer of Property Act
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Judges
Acts
  • Section 13 of the East Punjab Rent Restriction Act
  • Transfer of Property Act, Section 17 of the Registration Act
  • Section 107 of the Transfer of Property Act
Smart Summary

Factual and Procedural Background

The present decision arises from an appeal filed by the tenant against a decree of eviction originally passed by the Rent Controller on the ground of arrears of rent. The Appellate Authority affirmed the eviction order and the High Court dismissed the tenant’s revision petition. The dispute concerns a shop allegedly let out on 25 March 1975. The landlord asserted an agreed rent of Rs 5000 per annum, whereas the tenant maintained that the annual rent was only Rs 2500 and also disputed the authenticity of the rent note.

Evidence recorded before the authorities below established that the tenant had in fact executed the rent note and initially paid Rs 5000, of which Rs 2500 was later returned. The landlord claimed arrears amounting to Rs 2500 for the period 1 October 1975 – 31 March 1976 and Rs 5000 for 1 April 1976 – 31 March 1977. On 30 July 1976 the tenant tendered Rs 2500 together with Rs 52 as interest and Rs 30 towards costs, asserting that this payment cleared the rent in advance for 9 April 1976 – 8 April 1977. The authorities below found the tender insufficient and ordered eviction, prompting the instant appeal.

Legal Issues Presented

  1. Whether the unregistered rent note, which fixed yearly rent payable in advance, could be relied upon to determine the terms of tenancy in view of Section 17 of the Registration Act and Section 107 of the Transfer of Property Act.
  2. Whether, for the purpose of Section 13 of the East Punjab Rent Restriction Act, the tenant had duly tendered “all arrears of rent” on the first date of hearing so as to defeat the landlord’s prayer for eviction.

Arguments of the Parties

Appellant-Tenant’s Arguments

  • The rent note amounted to a lease from year to year; as it was unregistered it was inadmissible in evidence, and no term in it—including the clause requiring yearly rent in advance—could be enforced.
  • On the basis of the admissible evidence, the annual rent could not exceed Rs 2500, and because Rs 2500 had already been tendered on the first date of hearing, the statutory requirement under Section 13 was satisfied.
  • Cited precedents (Sajid Mia Majumdar, Babulal Somalal, Chittilapalli Mathai) to support the proposition that an unregistered lease from year to year cannot be proved or acted upon.

Respondent-Landlord’s Position

  • The tenant executed the rent note fixing rent at Rs 5000 per annum, paid that amount initially, and therefore remained liable for rent computed on that basis.
  • Even disregarding the yearly-in-advance clause, the tenant was in arrears for at least two months’ rent under the statute and failed to clear those arrears on the first date of hearing.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Sajid Mia Majumdar v. Abdul Sattar Gani, AIR 1954 Ass 102 A lease from year to year is compulsorily registrable; if unregistered, it is inadmissible to prove the terms of tenancy. Accepted in principle, but held immaterial because the lease expired after one year; the tenant thereafter became a monthly tenant liable to pay rent month to month.
Babulal Somalal v. Kantilal Hargovandas, AIR 1979 Guj 50; (1979) 1 Ren CJ 208; (1979) 1 Ren CR 347 Same proposition regarding inadmissibility of an unregistered lease for more than one year. Same treatment as above; the Court proceeded on the footing that the lease could not be used to enforce yearly-in-advance rent but nonetheless found the tenant in arrears as a monthly tenant.
Chittilapalli Mathai v. Chittilapalli Kochouseph, 1956 (2) Mad LJ 75 Unregistered leases beyond one year cannot be admitted in evidence. Noted but not decisive; the Court’s ratio rested on the statutory obligation to pay monthly rent after the original one-year term expired.

Court's Reasoning and Analysis

The Court agreed that the rent note, being for a one-year term with a stipulation of annual rent payable in advance, could not be utilised to establish a lease from year to year because it was unregistered. Consequently, the tenancy created by that document came to an end after one year. Thereafter the tenant continued in possession as a tenant holding over, attracting the ordinary incidents of a monthly tenancy under the East Punjab Rent Restriction Act.

Under the Act a tenant must pay or tender rent for each month before the end of the succeeding month. On the first date of hearing (30 July 1976) the tenant tendered only Rs 2500, an amount that covered neither the admitted arrears up to 31 March 1976 nor the rent that had meanwhile accrued for April and May 1976. Therefore, even after disregarding the unenforceable clause for yearly rent in advance, the tenant stood in arrears of at least two months’ rent on that date.

Section 13 of the East Punjab Rent Restriction Act mandates dismissal of an eviction petition only if the tenant pays “all arrears of rent” on the first hearing. Because the tender was deficient, the statutory protection was unavailable, and the landlord was entitled to eviction. The Court found no error in the concurrent findings of the Rent Controller, Appellate Authority, and High Court.

Holding and Implications

Appeal Dismissed; eviction decree affirmed with costs.

The dismissal leaves intact the eviction order against the tenant and awards costs to the landlord. The decision underscores that a tenant holding over after an unregistered fixed-term lease remains obliged to discharge monthly rent obligations, and failure to clear all arrears on the first date of hearing under Section 13 of the East Punjab Rent Restriction Act will result in eviction. No new legal precedent was announced, but the ruling reiterates the interaction between registration requirements and rent-control protections.

    Budh Ram v. Ralla Ram Deceased Through Lrs .

    G.L Oza, J.— This is an appeal by the tenant against an order of eviction granted by the Rent Controller and maintained by the Appellate Authority and revision petition against which was dismissed by the High Court. The eviction was sought on the ground of arrears of rent. It was alleged that the shop in dispute was let out to the appellant tenant @ Rs 5000 per annum whereas according to the appellant-tenant the rent was Rs 2500 per annum and not Rs 5000 per annum. It was pleaded in the application on behalf of the landlord that the rent note was executed on March 25, 1975. This was for one year and the rent fixed was Rs 5000. According to the tenant, it was pleaded that the rent was Rs 2500. The signature on the rent note was disputed.

    2. After recording evidence the courts below have come to the conclusion that the rent note was executed by the appellant tenant. The rent note mentions that it is for one year. It appears in evidence that initially Rs 5000 were paid by the appellant and later on Rs 2500 were returned. According to the landlord this was returned as it was agreed that the tenant will remain in the premises only for 6 months and not for one year and therefore Rs 2500 were returned. It is alleged that in the rent note there is also a term that the rent will be paid in advance.

    3. The landlord before the Rent Controller claimed that the tenant was in arrears of rent to the extent of Rs 2500 for the period commencing from October 1, 1975 to March 31, 1976 and was in arrears of Rs 5000 for the period commencing from April 1, 1976 to March 31, 1977. It is not in dispute that on July 30, 1976, the tenant appellant tendered a sum of Rs 2500 saying that it is the advance rent from April 9, 1976 to April 8, 1977. He also tendered Rs 52 by way of interest and Rs 30 as costs, and it is on this basis that it was contended that as this amount of rent was tendered on the first date of hearing, the landlord was not entitled to eviction under Section 13 of the East Punjab Rent Restriction Act. The courts below came to the conclusion that the contention of the tenant that the annual rent was Rs 2500 is not established. It was further held that therefore on July 30 when the tenant tendered Rs 2500 it was not rent up to date as he was in arrears not only of the amount of Rs 2500 for the year ending on March 1976 but he was in arrears for the next year.

    4. It was also held that if this rent note could not be used as a piece of evidence for lease from year to year and the lease came to an end after one year, the tenant could only be said to be a tenant holding over and thus he could only be treated as a monthly tenant and even in that view of the matter within the language of Section 13, the tenant will be in arrears at least for 2 months rent i.e April and May even if the term in the rent note of payment of yearly rent in advance is also not given effect to and in this view of the matter the order of eviction has been maintained.

    5. The main contention advanced on behalf of the appellant is that as the rent note is for one year and it fixed yearly rent and talks of yearly rent in advance it clearly is a lease from year to year and therefore as it is not registered in view of Section 17 of the Registration Act and Section 107 of the Transfer of Property Act, this could not be admitted in evidence and therefore the term could not be enforced which talked of payment of yearly rent in advance and it was therefore contended that the tenant at the most could be held to be in arrears to the tune of Rs 2500 as Rs 2500 was paid in advance and on this basis it was contended that the decree for eviction could not be maintained.

    6. Learned counsel for the appellant placed reliance on Sajid Mia Majumdar v. Abdul Sattar Gani AIR 1954 Ass 102, Babulal Somalal v. Kantilal Hargovandas AIR 1979 Guj 50, (1979) 1 Ren CJ 208, (1979) 1 Ren CR 347 and Chittilapalli Mathai v. Chittilapalli Kochouseph 1956 (2) Mad LJ 75 to contend that in view of the Transfer of Property Act and Section 17 of the Registration Act, a lease for year to year requires registration and in absence of registration, the document could not be admitted in evidence, and as the document is inadmissible in evidence, it could not be used as piece of evidence in proof of the terms of the lease.

    7. It is no doubt true that this document talks of payment of yearly rent in advance but it clearly is a lease for one year and it is therefore clear that this document could not be considered as a piece of evidence for the proof of a lease from year to year, on the basis of yearly rent. But the High Court took the view and rightly that the lease came to an end after the expiry of one year and thereafter even if the tenant is held to be holding over still he is expected to pay rent as contemplated in the provisions of the Rent Act itself and in that view of the matter it could not be disputed that the petitioner appellant is expected to pay rent from month to month and that rent has to be paid in the succeeding month before the end of the month and in this view of the matter it is not disputed that on the day when the appellant tendered the rent in the court in addition to what he had deposited he was in arrears of rent at least for two months which he did not tender and in this view of the matter the courts below were right in coming to the conclusion that the landlord was entitled to a decree for eviction on that ground.

    8. In our opinion, the courts below were right in holding that the appellant tenant was in arrears of rent and on the first day of hearing he did not tender or pay the whole amount of arrears and therefore the courts below were right in granting a decree for eviction. We therefore see no reason to entertain this appeal. It is therefore dismissed with costs. The respondents shall be entitled to the costs of this appeal.

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    Comments

    Budh Ram v. Ralla Ram Deceased Through Lrs .
    (Aug 19, 1987)