A. Rafeeq Ahmed & Co... v. Montari Leather Ltd....

ORDER — E. Padmanabhan, J.

This revision has been preferred against the fair and decretal order of the learned Rent Control Appellate Authority (Subordinate Judge) of Vellore made in I.A No. 27 of 2001 in RCA No: 13 of 2000

2. The petitioner herein is the landlord of the suit tenancy premises while the respondent is the tenant of the said premises.

3. The revision petitioner filed RCOP No. 57 of 1998 on the file of the Rent Controller (District Munsif) at Vellore under section 10(2)(1) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 seeking for eviction on the ground that the respondent-tenant had committed wilful default in payment of rent since September, 1996. After issue of the requisite notice, the eviction petition was instituted. The respondent mainly pleaded that it is a “sick company” under the Sick Industrial Companies (Special Provisions) Act, 1985 that it had moved the Board of Industrial Finance Reconstruction by filing an application to declare it as a sick company in Case No. 27’ of 1998 and in terms of Section 2 of the said BIFR Act, 1985 no proceedings could be instituted against the respondent including a petition for eviction till the BIFR is seized of the application, besides contending that an application without prior permission from the BIFR is not maintainable. The respondent pleaded that a portion of the rent has been paid. With respect to the quantum of arrears practically there is no dispute between the parties.

4. The petitioner-landlord filed an application in I.A No. 27 of 2000 under Section 11(3) and 11(4) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 before the Rent Controller praying to conduct an enquiry under section 11 (3) of the Act and pass consequential orders as provided under section 11(4) of the Act.

5. The petitioner-landlord stated that after giving credit to the sum of Rs. 1,90,037.60 a sum of Rs. 1,01,861.09 is due and payable towards arrears of rent for the period up to January 1999. The respondent-tenant resisted the said application contending that such an application is not maintainable and that Section 22 of the Sick Industrial Companies Act is a bar to the eviction petition and that the application filed under Sec. 11(3) and (4) is not maintainable.

6. Pending the said application filed by the petitioner-landlord the respondent-tenant took out an application to stay all further proceedings in I.A.No:27 of 1999, which application was dismissed by the Rent Controller. Being aggrieved, the respondent preferred CRP No. 2955 of 1999 on the file of this Court. P. Shanmugham, J., while following the decision of the Supreme Court in Shree Chamundi Mopeds Lts. v. Church of South India Trust Association CSI Cinod Secretariat, Madras reported in 1992 (3) SCC 1 = 1992 2 L.W 10, held that no interference is called for with respect to the order passed by the Rent Controller as an application under Section 11(3) and 11(4) is maintainable. In that view learned Judge by order dated 27.10.1999 dismissed the CRP. No. 2955 of 1999.

7. Thereafter in I.A No. 27 of 1999 in RCOP No. 57 of 1998 the Rent Controller passed orders on 27th of March 2000 under Section 11 (4) holding that the respondent tenant had failed to remit the arrears of rent aggregating Rs. 1,28,77,861.19 and directed the respondent-tenant to deposit the said amount on or before 27.6.2000 and failing compliance, the proceedings will be stayed and that there will be a direction to evict the respondent - tenant in terms of Sub Section (4) of Sec. 11

8. Being aggrieved by the said order dated 27.3.2000, in I.A No. 27 of 1999, the respondent-tenant preferred RCA No. 13 of 2000 on the file of the Rent Control Appellate Authority of Vellore. Pending the appeal the respondent as tenant has also taken out I.A No. 27 of 2000 in RCA, 13 of 2000 to stay the fair and decretal order dated 27.3.2000 made in I.A No. 27 of 1999, in RCOP. No. 57 of 1998. The said application was taken out under Section 23 read with rule 12 of the Tamil Nadu Buildings (Lease and Rent Control Act, 1960 and the Rules framed thereunder. The said interlocutory application was resisted by the revision petitioner/landlord by filing a detailed counter.

9. The Appellate Authority (Subordinate Judge) while overruling the objections that it is not necessary to deposit the entire arrears by the respondent-tenant as a condition precedent for preferring an appeal, granted stay of the order passed by the Rent Controller in I.A No. 27 of 1999 under section 11(4) of the Act, As such the Rent Control Appellate Authority granted stay of the proceedings without any condition and without the respondent-tenant being required to deposit the admitted arrears of rent along with the appeal or subsequently thereto despite specific objection raised in this behalf.

10. Being aggrieved by the said order dated 20th September, 2000. the landlord-respondent before the Rent Control Appellate Authority has preferred the present revision petition contending that no tenant against whom an application for eviction has been made by the landlord under Section 10 shall be entitled to contest the application before the Rent Controller under section 10 or prefer any appeal under section 23 against any order made by the Rent Controller on the application, unless he has paid or pays to the landlord or deposits with the Rent Controller the Appellate Authority as the case may be all arrears of rent due in respect of the building, up to the date of payment or deposits and continues to pay or deposit the rents which may subsequently become due in respect of the building, until the termination of the proceedings before the Controller or the Appellate Authority as the case may be.

11. When the Revision came to be posted before one of us (my learned brother S. Jagadeesan, J.,) the counsel for the revision petitioner relied upon five earlier pronouncements in support of his contention that deposit of arrears of rent is a condition precedent for entertaining the appeal, while the counsel for the respondent-tenant placed reliance upon four earlier pronouncements of this Court in support of his contention that there is no need or requirement to deposit the entire arrears of rent for filing the appeal as it is not a condition precedent for entertaining the appeal.

12. The divergent views have been pointed out by either side. In this circumstance, S. Jagadeesan, J., considered that the controversy has to be decided by a Division Bench of this Court for a binding pronouncement and directed the Registry to place the paper's before My Lord the Hon'ble The Chief Justice for posting the Revision before a Division Bench. Accordingly, this revision is posted before us as per order of the Honourable Chief Justice.

13. The order of reference passed by S. Jagadeesan, J., reads thus: —

“The petitioner herein filed R.C.O.P 57 of 1998 on the file of the Rent Controller (District Munsif), Vellore for evicting the respondent herein on the ground of wilful default. After filing the counter affidavit by the respondent, the petitioner filed an application I.A 27 of 1999 under Section 11(3) and (4) of the Tamil Nadu Buildings (Lease and Rent Control) Act,. 1960 seeking for a direction directing the respondent to deposit the arrears of rent. The Rent Controller by his order dated 27.3.2000 allowed the said application and directed the respondents to deposit the arrears of rent of Rs. 1,28,861-19 on or before 27.6.2000

2. The respondent herein filed an appeal in R.C.A 13 of 2000 on the file of the Appellate Authority (Sub-Judge). Vellore. He has also filed an application I.A 27 of 2000 for the stay of the order of the Rent Controller, directing deposit of the arrears of rent. The petitioner herein took a preliminary objection stating that the tenant, the respondent herein has to deposit the arrears of rent, as directed by the Rent Controller before even the appeal is filed, since the same is a condition precedent for entertaining the appeal filed by the respondent. The lower appellate court did not agree with the contention of the petitioner herein and granted stay of the operation of the order of the Rent Controller, directing deposit of the arrears of rent. As against the same, the present revision has been filed.

3. The question to be considered in this revision is whether the tenant has to deposit the arrears of rent in accordance with the order passed by the Rent Controller under Section 11(4) of the Tamil Nadu Buildings (Lease and Rent Control) Act for entertaining the appeal, since the same is condition precedent for entertaining the appeal.

4. The learned counsel for the petitioner relied upon the following judgments:

1) Iqbal & Co. v. Abdul Rehman (1982 (2) All India Rent Control Journal 369 = 95 L.W 245 (S. Mohan, J);

2) S.K Rajapandian v. A. Kesavan (1991 2 L.W 453) (Srinivasan, J.);

3) Pichai Chetty (died) and 5 others v. N.K Muthukrishnan (1991 2 L.W 614) (Thanikkachalam, J.);

4) P.K Periyasamy Nadar & sons v. S. Sakthivel (1997 II CTC 241 = 1997 1 L.W 200) (M. Karpagavinayagam, J.);

5) M.S. Murugan v. Santhakumari (2000 3 L.W 394) (M. Karpagavinayagam, J.);

in support of his contention that the deposit of the arrears of rent in compliance of the order passed by the Rent Controller under Section 11(4) of the Buildings Act is a condition precedent for entertaining the appeal.

5. Whereas the learned counsel for the respondent relied upon the following judgments:

1) R. Radha v. G.R Govindarajulu (91 L.W 443) (DB) Ismail and Nainar Sundaram, JJ;

2) Iqbal & Co v. Abdul Rahim (95 L.W 245 = 1982 1 MLJ 221) Mohan, J.;

3) Ravi Ram v. Somasundaram (97 L.W 70) Gokulakrishnan, J.;

4) K.P Janaki ammal and 8 others v. K. Badrinarayanan (1999 2 L.W 102) R. Balasubramanian, J.

in support of his contention that in compliance of the order of the Rent Controller, there is no need to deposit the entire arrears of rent for filing the appeal, since the same is not a condition precedent for entertaining the appeal.

6. From the above, it is clear that there are divergent opinions by the learned Judges of this Court as to whether the deposit of rent in compliance of the order of the Rent Controller passed under Section 11 (4) of the Act is a condition precedent or not. I am of the view that it is a fit case where the question has to be decided by a Division Bench of this Court in order to give a finality.

7. Hence, I direct the Registry to place the papers before My Lord The Honourable the Chief Justice for posting this matter before a Division Bench.”

14. The point that arise for consideration in this reference is: —

(i) Whether deposit of arrears of rent is a condition precedent to prefer an appeal against an order passed under Sections 11(3) and (4) of the Tamil Nadu Buildings (Lease and Rent Control) Act or when a direction is issued under Section 11(4) to deposit arrears and the said order is challenged before the appellate forum?

15. To answer this reference, it is essential to refer to the statutory provisions of the Tamil Nadu Buildings (Lease and Rent Control) Act.

16. By section 23 of the Act, the State Legislature has provided a remedy of appeal being preferred before the Appellate Authority having jurisdiction by any person aggrieved by an order passed by the Rent Controller. The appellate authority shall call for the records of the case from the Controller and after affording the parties an opportunity of being heard, and if necessary, after making such further inquiry as he thinks fit, either personally or through the Controller shall decide the appeal.

17. Sub Section (1) (b) of Section 23 reads thus: —

“(b) Any person aggrieved by an order passed by the Controller may, within fifteen days from the date of such order, prefer an appeal in writing to the Appellate Authority having jurisdiction.”

18. Sub Section (2) of Section 23 reads thus: —

“(2) on such appeal being preferred, the Appellate Authority may order stay of further proceedings in the matter pending decision on the appeal.”

19. Sub Section (3) of Section 23 reads thus: —

“(3) The Appellate Authority shall call for the records of the case from the Controller and after giving the parties an opportunity of being heard and, if necessary, after making such further inquiry as he thinks fit either personally or through the Controller, shall decide the appeal.”

20. The rest of the portion of the Section has no direct bearing to this reference. It is also the consistent view of this Court that the Appellate Authority, who has been conferred with the power to exercise powers under Section 23 of the Act is a persons designata. As against the orders of the Appellate Authority, a remedy of revision has been provided under Section 25 of the Act.

21. Section 34 of the Act confers powers on the State to make Rules. Clause (b) of Sub Section (2) of Section 34 enables the Government to frame the Rules prescribing the procedure to be followed by the Controller and Appellate Authority in the performance of their statutory functions as Tribunal or adjudicating authorities under the Act. To this extent the provisions of the Code of Civil Procedure stands excluded or at least by implication.

22. Section 23 itself prescribes the period of limitation for preferring the appeal and the extension of the limitation is also prescribed in the said statutory provision. It is the settled view that the Rent Control Act is a complete Code, but Section 5 of the Limitation Act has been held applicable to the proceedings under section 23 of the Act.

23. By now it is well settled that right of appeal is a creature of the statute and there can be no inherent right either of appeal or revision against the judgement or order of an inferior court or Tribunal, unless it is provided for. Such appeal could be maintained under Section 23 if the appellant is an aggrieved person or aggrieved by an order passed by the Rent Controller.

24. A party who has consented to an order cannot and shall not be permitted to maintain an appeal as he cannot in law be deemed to be a person aggrieved by such consent order. It is equally well settled that the power of the Appellate Authority is coextensive with that of the original authority, namely the Rent Controller.

25. Ordinarily the appellate jurisdiction involves rehearing as it relates to the appeal which could be both on law and on facts, when it is invoked by an aggrieved person. In Rajalakshmi Dyeing Works v. Rangaswamy Chettiar, reported in 1980 (4) SCC 259, while considering the scope of Section 23, the Apex Court held that ordinarily appellate jurisdiction involves a rehearing as it were, on law as well as fact and is invoked by an aggrieved person and such jurisdiction may however be limited or restricted in some way or it could be subject to such procedure or condition precedent as the Legislature may deem fit. When no condition is prescribed or imposed either by the in-built statutory provision or a rule, it has to be taken that the power of Appellate Authority is in no way restricted, nor any condition precedent has to be complied or required to be complied before preferring such appeal. The power of the Appellate Authority is coextensive with that of the original authority, viz., Rent Controller in the present case.

26. The right of appeal has to be prescribed by the statutory provision. This is not in itself a necessary part of the procedure in action, but is the right of entering a superior court invoking its aid and interposition to redress the error of the court below. Such a paramount right is provided only by the statutory provision in which the question is, whether the order of the Court or tribunal from which the appeal is brought is right on the materials which that Court or Tribunal had before it. The right of appeal when provided by the statute is a matter of substance and not of procedure.

27. It is to be pointed out that in terms of the statutory provisions of the Rent Control Act, no leave is required to prefer an appeal and such a substantive right has been conferred by the statutory provision on any aggrieved person to challenge the order of the Rent Controller/Tribunal from which the appeal is brought, is right or not on the material which that court had before it.

28. Deprivation of one's statutory right to appeal amounts to denial of procedure established by law. An appeal exists by virtue of the statutory provision and unless the statutory conditions are fulfilled no jurisdiction is conferred to any appellate court or authority to entertain them if such conditions are either precondition or subject to such condition when the statutory provision provides a remedy of appeal. In Ohene Moore v. Askash Jaie reported in AIR 1935 P.C 5 = 41 L.W 84 the Privy Council held thus: —

“After all, it is to be remembered that all appeals in this country and elsewhere exist merely by statute and unless the statutory conditions are fulfilled no jurisdiction is given to any court of justice to entertain them.”

“The other grounds which are referred to by the learned Judge relate to powers which are given to an appellate court to adopt certain procedure to waive rules, and to try and do substantial justice — all very important powers, but which can only be brought into play once the appellate court is seized of the appeal and has jurisdiction to entertain it. But the objection lies in limine, in that the Provincial Commissioner had no jurisdiction at all: and therefore the reference to these powers unfortunately is irrelevant to the question of the Provincial Commissioner being able to give relief. It is quite true that their Lordships, as every other court, attempt to do substantial justice and to avoid technicalities; but their Lordships, like any other court are bound by the statute law and if the statute law says, there shall be no jurisdiction in a certain event, and that event has occurred, then it is impossible for their Lordships or for any other court to have jurisdiction.”

29. The Apex Court in Garikapati Veerayya v. Subbiah Choudhry, reported in AIR 1950 SC 540 held thus: —

“23. From the decisions cited above the following principles clearly emerge:

(i) That the legal pursuit of a remedy suit appeal and second appeal are really but steps in a series of proceedings all connected by an intrinsic unity and are to be regarded as one legal proceeding.

(ii) The right of appeal is not a mere matter of procedure but is a substantive right.

(iii) The institution of the suit carries with it the implication that all rights of appeal then in force are preserved to the parties thereto till the rest of the career of the suit.

(iv) The right of appeal is a vested right and such a right to enter the superior court accrues to the litigant and exists as on and from the date the lis commences and although it may be actually exercised when the adverse judgement is pronounced such right is to be governed by the law prevailing at the date of the institution of the suit or proceeding and not by the law that prevails at the date of its decision or at the date of the filing of the appeal.”

30. A reading of Section 23 of the Act in our considered view, the appeal is not limited in any manner either by the substantive provision or by the procedure prescribed under the rules. In other words the appeal before the appellate authority in terms of section 23 of the Act has ample as it could be and more ample than that of a judicial review. It is in effect a full appeal where all evidence could be examined and it is not a limited appeal on a question of law only or where the appellate authority does not investigate the findings on fact.

31. The existence of a full right of appeal on the merits may be taken into account in examining the scheme of the Act, which does not require a hearing of a mere preliminary step or in respect of a precondition or leave to prefer an appeal. In contradistinction to various identical enactments in other States where it is necessary to obtain leave to appeal to the tribunal or to the appellate forum, the appeal before the Rent Control Appellate Authority under section 23 of the Act or in a given situation or in a given enactment where the statutory provision prescribes securing leave to prefer an appeal or striking out. This is not the case here, as under the provisions of the Act, the appeal is of right.

32. In Vijayaprakash D. Metha and Jawahar D. Metha v. Collector of Customs, reported in AIR 1988 SC 2010 the Apex Court held thus: —

“9. Right of appeal is neither an absolute right nor an ingredient of natural justice the principles of which must be followed in all judicial and quasi judicial adjudications. The right to appeal is a statutory right and it can be circumscribed by the conditions in the grant.”

33. Rule 15 of the Tamil Nadu Buildings (Lease and Rent Control) Rules 1974 has been framed in exercise of powers conferred under section 34 of the Act. Rule 15 prescribes the procedure for filing of appeals. Rule 15 requires that every appeal against the order of the Controller shall, in addition to the grounds of appeal, specify the date on which the order was received by the appellant, the appeal shall be signed by the appellant and his counsel, if any, and presented to the appellate authority or to such officer as he appoints in this behalf and the appeal shall be accompanied by a copy of the order of the controller appealed from besides a spare copy or sufficient number of copies thereof for service on the respondent or respondents mentioned in the appeal.

34. Rule 16 prescribes the procedure for the disposal of the appeals under section 23. Rule 16 requires the appellate authority on an appeal being preferred, but to fix a date for hearing of the appeal, send notice to the appellant/appellants and the respondent/respondents and send a copy of the appeal along with the notice to the respondent/respondents. If the appellate authority decides, it may make further enquiry or take additional evidence or requires such evidence to be taken by the controller. Sub rule (3) of rule 16 provides the procedure to set aside the exparte proceedings and the procedure relevant thereto as well as the limitation to set aside such ex parte proceedings or decision. Nowhere in the substantive provision namely section 23 or in the procedure prescribed by the rules namely Rules 15 and 16 any restriction or condition has been imposed to circumscribe the right of appeal or the powers of the appellate authority. These are the salient features of the appeal provisions and the scope of the provision as well as the Rules, which let us not lose sight.

35. The next provision which is relevant to answer the present reference being Section 11 of the Act which provides for payment of deposit of arrears of rent during the pendency of proceedings for eviction. Section 11(1) reads thus: —

“(1) No tenant against whom an application for eviction has been made by a landlord under section 10 shall be entitled to contest the application before the Controller under that section, or to prefer any appeal under section 23 against any order made by the Controller on the application, unless he has paid or pays to the landlord, or deposits with the Controller or the Appellate Authority, as the case may be, all arrears of rent due in respect of the building up to the date of payment or deposits, and continues to pay or to deposit any rent which may subsequently become due in respect of the building until the termination of the proceedings before the Controller or the Appellate Authority, as the case may be.”

36. Section 11(2) reads thus: —

“(2) The deposit of rent under sub-section (1) shall be made within the time and in the manner prescribed.”

37. Section 11(3) provides where there is any dispute as to the amount of rent to be paid or deposited under sub section (1), the Controller or the Appellate Authority, as the case may be, shall on application made to him either by the tenant or by the landlord, and after making such inquiry as he deems necessary, determine summarily the arrears of ren to be so paid or deposited.

38. Section 11(4) of the Act which is also a crucial provision for the present reference is extracted and it reads thus: —

“(4) If any tenant fails to pay or to deposit the rent as aforesaid, the Controller or the Appellate Authority, as the case may be, shall, unless the tenant shows sufficient cause to the contrary, stop all further proceedings and make an order directing the tenant to put the landlord in possession of the building.”

39. Section 11(1) takes care of original proceedings for eviction as well as the appeal thereof.

40. Before coming into force of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960, the Madras Buildings (Lease and Rent Control) Act, 1949 (Madras Act XXV of 1949) was in force and the provisions of the said Act was repealed by section 35 of the 1960 Act, which is presently in force.

41. Section 7.A was the corresponding provision in the 1949 Act. There is no material difference between S. 7-A of the 1949 Act and Section 11 of the present Act. A Full Bench or this Court in K. Perumal Chettiar v. Muthuswamy, reported in (1962) 75 L.W 390 = 1962 (2) MLJ 218, while considering the question as to whether a landlord could file a second application for any relief, against a tenant, even during the pendency of an earlier application, held thus: —

“Section 7.A has no reference to the determination of any disputed question: it is intended only to prevent defaulters from continuing in possession of the property taking advantage of the pendency of an application without at the same time performing their own part of the obligations. Secondly it does not cover grounds other than default of payment of rent, i.e, other grounds specified in sections 7(2) and 7(3) which would justify eviction. It cannot, therefore, be held that the rejection of the petition of the landlord by the Rent Controller would be tantamount to an adjudication against him of all grounds justifying eviction which arose subsequent to the filing of the original petition for eviction “

(emphasis supplied).”

42. The above is the construction placed on identical provision of the repealed enactment and it emphasised the obligation on the part of the tenant to pay the arrears. However, let us not lose sight of the fact that the point raised in this reference was not the subject matter of consideration before the said Full Bench.

43. Ramaprasada Rao, Chief Justice, as he then was in Lachiram v. Kumaresan, reported in 1971 (2) MLJ 135 while considering the scope or purport of Section 11(4) of the Act held thus: —

“2. A proceeding under section 11(4) of the Act is intended to accelerate the long drawn proceedings under the Tamil Nadu Buildings (Lease and Rent Control) Act. As eviction is possible in a case where the tenant commits wilful default in the payment of rents and particularly, after the recent amendment in 1973 explaining wilful default as meaning no payment or tender of rent after the issue of a notice calling for such payment of rent by the landlord, the importance of section 11(4) has to be brought to light and in its true light. Section 11(4) is, therefore, intended to make the tenant alert during the entirety of the proceedings and be conscious of his obligations and statutory duties in the matter of payment of rents. Even here, the Legislature has provided that the Rent Controller in a case where an application under section 11(4) is taken by the land-lord should enquire into the dispute as to the amount of rent to be paid by the tenant and make such enquiry as he deems necessary and summarily determine the rent so to be paid or deposited. Such enquiry should not be longdrawn as in the case with the main proceedings.

It is only to safeguard the interests of the landlords in relating to such recalcitrant tenants that a provision like Section 11(4) has been introduced. The very purpose of the said section would be lost if the order of eviction had not been passed early by the courts below. Rightly the courts found that the admitted arrears have not been paid in spite of several opportunities given to the tenant. It was in these circumstances, the order was made under Section 11(4). They had the jurisdiction to do it. There was sufficient material to act upon and the decision on such material arrived at by the courts below is correct.”

(emphasis supplied)

The scope of Section 11 has been considered and laid down as above.

44. On a plain reading of Section 11(1). the following could be deduced-

(i) to invoke Section 11, the landlord should have applied for eviction under section 10;

(ii) as against the tenant against whom a disability has been imposed to contest the application before the Controller, he should have paid or pays to the landlord or deposits with the Controller all arrears due in respect of the building up to the date of payment/deposit and continues to pay or deposit rents which may subsequently become due in respect of the building until the termination of the proceedings before the Controller.

(iii) As against a tenant against whom an application for eviction has been made, a disability has been imposed on him to prefer any appeal under Section 23 against any order made by the Controller on the application unless he has paid or pays all arrears or deposits and continues to pay or deposit which deposit in rent which may subsequently become due until the termination of the proceedings before the Rent Controller or Appellate Authority as the case may be.

45. When there is any dispute as to the amount of rent to be paid or deposited under sub section (1) the authority, namely, the Controller or the appellate authority may make such enquiry as he deems necessary, determine summarily the deposit to be made or deposited. If after such determination the tenant fails to pay or deposit the rent as aforesaid, the controller or the Appellate Authority as the case may be, unless the tenant shows sufficient cause to the contrary, stop all further proceedings and make an order directing the landlord to be put in possession by the tenant of the building. An order under section 11(4) terminating further proceedings and directing the tenant to put in possession of the landlord of the building will have to be taken as one under Section 11(4) read with sub clause(2) of Section 10 of the Act and it is executable under Section 18 of the Act.

46. The Apex Court in a recent pronouncement in Sankaran Pillai v. Vengudusami reported in 1999 (9) SCC 396 had occasion to examine the scope of Section 11 and held thus: —

“3. A perusal of the aforesaid provisions shows that where an application for eviction has been filed against a tenant on the ground of default in payment of rent the tenant is required 1) to deposit all the arrears of rent due in respect of the building with the Controller or the Appellate Authority, as the case may be; (ii) the tenant is further required to pay or deposit the rent which may subsequently fall due in respect of the building until the termination of the proceedings; (iii) the said deposit of rent is required to be paid or deposited within the time provided and in the manner prescribed; and iv) if the deposit of rent is not made, the Controller or the appellate, authority, as the case may be shall, unless the tenant shows sufficient cause to the contrary, stop all proceedings and pass an order of eviction against the tenant. It is true that the Controller or the appellate authority, as the case may be, if the tenant shows sufficient cause may permit the tenant to contest the application filed by the landlord for his eviction. The question that is required to be seen is, what does the expression “sufficient cause” mean in sub-section (4) of Section 11 of the Act. It is no doubt true that the expression “sufficient cause” has to be liberally construed to do substantial justice between the parties. But the expression “sufficient cause” necessarily implies an element of sincerity, bona fide, and reasonableness. It has to be shown by the tenant who has not deposited the rent within time, as directed there was no element of negligence or inaction or lack of bona fides on his part in not depositing the rent within time.

Viewed in this light, what we find in the present case is that the tenant was required to deposit the rent by 3.8.1990 But the arrears of rent were not deposited by that date. On 7.8.1990, when the order of eviction was passed, no apliction was moved by the tenant before the Rent Controller for revoking the order striking out defence as he could not deposit the arrears of rent on account of reasons beyond his control. On the contrary, the tenant denied the relationship of landlord and arrears of rent before the appellate authority being requirement of law for hearing the appeal on merits, cannot be treated as bona fide deposit. Further, the tenant did not deposit the month to month rent as required under Section 11(1) of the Act and reiterated his stand that he is a landlord and not a tenant of the premises in dispute.”

47. It requires to be pointed out that section 23 of the Rent Control Act which is the substantive provision in no manner imposes any condition or restriction for filing an appeal by the tenant even in respect of an order of eviction passed under section 10, A reading of section 23 as we have already pointed out which is a substantive provision in no way disables the tenant or imposes any restriction or there is a disability on the tenant to prefer an appeal even against an order of eviction on the ground of wilful default in payment of rent passed under section 10 of the Act.

48. However section 11 of the Act which has given room to the present reference which provision is being relied upon heavily requires to be examined as to whether no appeal under section 23 could be preferred by a tenant against an order made by the Controller on the application for eviction made under Section 11(4) when the tenant had not pay or deposited all arrears of rent due up to the date of payment of deposit.

49. The expression which the Legislature had employed in section 11(1) in so far as it relates to appeal, proceeds thus: —

“No tenant against whom an application for eviction has been made by the landlord under section 10 shall be entitled to prefer any appeal under section 23 against any order made by the controller on the application unless he has paid or pays to the landlord or deposits with the controller or the appellate authority all arrears of rent due in respect of the building up to the date of payment or deposit…”

Section 11(1), if considered reasonably and given the right meaning it refers to an order under Section 10 and it cannot be extended with respect to an order or direction under Section 11(4) nor even 11(3) of the Act.

50. The expression means a disability has been imposed on the tenant by the statutory provisions in preferring an appeal which means an appeal arising out of an order under section 10 made by the landlord under Section 23. The very opening words of the section in our considered view, even on a simple and plain reading imposes a disability on the tenant from preferring an appeal under section 23 against any order made by the controller on the application filed by the landlord under section 10 unless he has paid or pays to the landlord arrears up to the date of payment.

51. Section 11 has a purpose and intendment and the Legislature had imposed a disability on a tenant who had defaulted to pay the rents either to contest the application under section 10 or to prefer an appeal under section 23. The statutory provisions, as pointed out by the Full Bench has a specific intendment and object.

52. In the order of reference itself the respective parties have relied upon various pronouncements in support of their respective contentions. It would be appropriate to refer to the pronouncements relied upon by the revision petitioner/landlord as well as the Respondent-Tenant.

53. In Iqbal and Company v. Abdul Rahim, reported in (1982) 95 L.W 245 = 1982 (2) RCJ 369 = 1982 (1) MLJ 221, Mohan, J. as he then was with reference to Section, 11(1) of the Act held thus: —

“Therefore I take it, the filing of the appeal was the only ground that was raised and even in such a case, deposit was essential. That being the correct position, the mere averment in the very same affidavit that the revision petitioner was ready and willing to deposit the entire amount into court less the admitted arrears already paid, would not in any way be helpful to the revision petitioner. He should have deposited the amount and then only could have avoided the eviction since the only ground that was stated was filing of the appeal. Therefore, on 5th September, 1980, the order dated 22nd August, 1980 has come into being and has worked itself out. The eviction order stood unaltered in the latter circumstances. By this I mean, the latter deposit can never cure the original non compliance. Therefore, the appeals themselves could not have been entertained unless and until the amount was deposited since subsection (1) categorically lays down:

“No tenant against whom an application for eviction was made by a landlord under section 10 shall be entitled to… prefer any appeal under section 23 against any order made by the Controller on the application, unless he has paid or pays to the landlord, or deposits with the Controller or the appellate authority…all arrears of rent due in respect of the building up to the date of payment or deposit, and continues to pay or deposit any rent which may subsequently become due… until the termination of the proceedings….”

Admittedly, at the time of preferring the appeal, the arrears had not been paid or deposited in terms of section 11(1) of the Act. Hence the appeals themselves should not have been entertained, apart form the fact that the order passed on 22nd August, 1980, had worked out itself, by the appellate authority. When the appeals themselves were incompetent, now the question becomes academic whether there was justification for refusing to deposit the amount. This is because purely of the statutory provisions and one cannot import the general consideration of justice or equity in a case of this character. That is why I said that it makes bad law.”

This pronouncement has to be confined to a case where an order of eviction has been made under Section 10 and the learned Judge had not examined scope of Section 11 (3), (4) and Section 23.

54. Srinivasan, J., as he then was in S.K Rajapandian v. A. Kesavan, reported in 1991 (2) L.W 453, while holding that the tenant/petitioner had not shown any sufficient cause for his failure to comply with the order passed by the Rent Controller under Section 11(4), sustained the order passed under Section 11(4) as affirmed by the appellate authority on the view that filling of an appeal would never be a sufficient cause for non compliance with the order of the Rent Controller, besides holding that it is not correct to argue that the appeal is the continuance of the original proceedings. However, the learned Judge had not examined the issue as to whether an appeal is maintainable under section 23 by a tenant either in respect of an order passed under Section 10 or 11(4) without pre-deposit of rental arrears, Hence the pronouncement is of no assistance.

55. In Pichai Chetty (died) and 5 others v. N.K Muthukrishnan, reported in 1991 (2) L.W 614, K.A Thanikkachalam, J., as he then was took the view that the deposit of arrears of rent is a condition precedent for filling an appeal against an order of eviction passed consequent to failure to deposit the arrears of rent pursuant to an order under section 23 of the Act. The learned Judge followed the decision of Mohan, J., in Iqbal's case, cited supra., The Learned Judge with respect we have to point out that without reference to statutory provision held that without paying or depositing the arrears of rent, as ordered by the rent controller under section 11(4) of the Act, an appeal cannot be entertained.

56. K.A Thanikkachalam, J., had taken the further view in that case, which is an extreme view in our view that a revision is also not competent if deposit is not made as against the order under section 11(4) read with Section 23 of Act. This mean the court is imposing restriction or condition or a disability which is not imposed or contemplated by the statutory provision.

57. In M.S Murugan v. Santhakumari and 4 others, reported in 2000 3 L.W 394, M. Karpagavinayagam., J., took the view that deposit of the amount ordered under section 11(4) of the Act is a sine qua non for entertaining the appeal by the appellate authority. In that context the Learned Judge placed reliance upon the decision of Srinivasan, J., in Ravinchandran v. Sulaiman, reported in 1996 (I) CTC 3 M. Karpagavinayagam., J., held thus: —

“The wording in Section 11(1) of the Act is as follows: —

“No tenant against whom an application for eviction has been made by a landlord under section 10 shall be entitled to contest the application before the controller under that section, or to prefer any appeal under Section 23 against any order made by the controller on the application, unless he has paid or pays to the landlord or deposits with the Controller or the appellate authority, as the case may be….”

It shows that under subsection (1) it would not be open to the tenant to contest the application for eviction pending before the Controller, unless all the arrears of rent are paid. This is before the original authority pending proceedings. Likewise, before the appellate authority also, such payment has to be made.

Subsection (2) requires the deposit of rent to be made within the time and the manner prescribed. But, the section is very clear in regard to the appeals to be filed before the appellate authority, that the tenant cannot prefer an appeal, unless the arrears of rent is paid.

The only difference between the original authority and the appellate authority is that before the original authority the tenant is not entitled to contest the application pending proceeding for eviction, whereas before the appellate authority he shall not be entitled to prefer an appeal under Section 23.

This make it clear that the appellate authority cannot entertain the appeal being preferred by the tenant without payment of arrears of rent. This interpretation alone would be in consonance with the object above mentioned.

In the light of the above legal situation, I am in perfect agreement with the view expressed by the Hon'ble Srinivasan, J., (as he then was) in Ravichandran v. N. Sulaiman (1996 (1) CTC 3) cited supra, following the judgement of a Division Bench of this Court in Kuppanna Chettiar v. Ramchandran 93 L.W 656 that the appeals against orders under Section 11(3) and 11(4) of the Act arising out of eviction petition under Section 10 of the Act, are not maintainable, unless the arrears of rent are paid, though there is another view expressed by the other Judges on the strength of the decision of another Division Bench of this Court in R. Radha v. C.R Govindarajulu 91 L.W 443.

58. Before M. Karpagavinayagam. J., contrary views expressed by R. Balasubramanian, J., and S.M Abdul Wahab. J., were pointed out, However, on facts of the said case, M. Karpagavinayagam, J., disposed of the revision while taking the view that deposit of arrears is sine qua non for entitling the tenant to contest the application for eviction as well as entertaining an appeal by the appellate authority, M. Karpagavinayagam., J., while following his earlier view in M.S Murugan's case, cited supra, took the view that deposit of entire arrears of rent is a condition precedent for filing an appeal against the order of eviction, and followed the view in Pichai Chetty's case and Ravinchandran's case, cited supra. Here again, we have to express our inability to share the view of M. Karpagavinayagam, J., in its entirety as it cannot be an universal Rule or absolute Rule to deposit the arrears, whether disputed or admitted as a condition precedent.

59. S.M Abdual Wahab, J., as he then was in Schwartz Dasan v. K.S. Devadoss, reported in 1999 (1) CTC 560 also had occasion to consider the question as to maintainability of appeal without deposit of the arrears of rent as directed by the Rent controller under section 11(4) of the Act. In this revision the main appeal was preferred against the order passed under section 11(4) of the Act directing the tenant to pay the arrears of rents. The Learned Judge took the view that when an appeal is preferred against the order passed under section 11(3) there is no necessity for him to deposit the arrears as according to the Learned Judge any order made by the Controller is referable only to the application under section 10 of the Act and not to any miscellaneous or interlocutory application. In that context, S.M Abdul Wahab, J., held thus: —

“12. When we come to the order to be passed under Section 11 (4) it is no doubt on the petition for eviction. But as I have already indicated, the order passed under Section 11(4) is only a consequential but the order passed under section 11(4) cannot stand by itself. In all the cases when an order is passed under section 11(3), the main appeal is invariably against the order. Therefore, in my view, when a tenant prefers an appeal against the order passed under Section 11(3), there is no necessity for him to deposit the arrears.

13. If we construe that Section 11(1) will apply even to an appeal preferred against an order under Section 11(3), the deposit become onerous and in some cases the right of appeal itself becomes impossible. Because, in certain cases, the tenant may not be in a position to deposit the amount, even in a case where there is a genuine dispute with reference to the quantum of the amount, Section 23, which gives the right of appeal to a tenant. Section 23(1)(b) of the Act enables the tenant to prefer an appeal against any order passed by the Rent Controller. This right of appeal under section 23(1) (a) will get modified if we have to construe that without depositing the amount ordered under Section 11(3) no appeal can be preferred. Section 11(1) contemplates an appeal under Section 23 against an order passed on an application under Section 10. Therefore, only for the appeals preferred on the application for eviction under Section 10, the restriction comes to operation.”

60. Before Wahab. J., the decision of Mohan, J., as he then was in Iqbal v. Abdul Rahim, reported on 95 L.W 245 and Pichai Chetty (died) 5 others v. N.K Muthukrishnan, reported in 1991 (2) L.W 614 were cited. However, the Learned Judge took the view that those decisions are not of any assistance nor are they on the point. That apart, the Learned Judge took the view that the two decisions are not in conformity with the Division Bench Judgment of this Court in R. Radha v. C.R Govindarajulu, reported in AIR 1978, Madras 399 and while placing reliance on the said Division Bench Judgment, the Learned Judge was of the view that the two decisions cannot be followed.

61. Nextly, the pronouncement of R. Balasubramanian, J., referred is that in K.P Jananki Ammal and 8 others v. K. Badrinarayanan, reported in 1999 (2) L.W 102, R. Balasubramanian, j., had occasion to consider the case of a tenant, who has suffered an order under Section 11(3) and 11(4), who was required to deposit the amount as found due in the proceedings of the controller as a condition precedent before filing the appeal. The Learned Judge answered the contention in the negative on the view that the statutory requirement of deposits is mandatorily provided under section 11(1) of the Act and can be invoked only when a tenant is contesting the application filed under section 10 of the Act seeking his eviction and when the tenant files an appeal against an order of eviction passed in such application, the requirement to deposit the amount was found due and ordered on an application under Section 11(3)/(4) of the Act will not be attracted to an appeal filed by the tenant against the order passed under section 11 of the Act. Such a requirement is called for to be complied with only either when the tenant is contesting the proceedings filed for eviction against him before the Rent Controller or when he files an appeal against an order of eviction passed under Section 10 of the Act and not in any other contingency. R. Balasubramanian, J., after referring to various earlier pronouncements held thus: —

“Accordingly, I have no hesitation to hold that the need of the requirement to deposit the amount as found due and ordered on application under section 11 of the Act will not be attracted in an appeal filed by the tenant against an order passed under section 11 of the Rent Control Act. Such a requirement is called for to be complied with only either when the tenant is contesting the proceedings filed for eviction against him before the Rent Controller or when he files an appeal against an order of eviction passed under section 10 of the Act and not in any other contingencies.”

62. P.R Gokulakrishnan, J., as he then was, in Raviram v. Somasundaram, reported in (97) L.W 70 held thus: —

“5. Section 11(1) read along with Section 23 of the Act, which clearly gives the right for a tenant or to a person aggrieved by an order passed by the Rent Controller to prefer an appeal, clearly visualises an appeal to be filed questioning the determination of such a rent summarily under S. 11 (3) of the Act. The decision reported in Iqbal and Co. v. Abdul Rahim does not visualise depositing of rents decided before preferring an appeal against the determination of rent under S. 11 (3) of the Act. A reading of the judgment rendered by Mohan, J., in the above decision clearly spells out that the rent admitted by the tenant as arrears has to be paid before any appeal has to be heard. Hence, I am of the view, that an appeal against an order rendered by the Rent Controller under S. 11(3) of the Act can be heard even without the tenant depositing the arrears of rent determined by the Rent Controller.”

(emphasis supplied)

63. Ratnam, J., as he then was, in A.E.M. Usoof v. O.M. Mohamed Ibrahim, reported in 1990 1 L.W 484 = 1990 (1) MLJ 486, held thus: —

“4. It would be necessary at this stage to notice the provisions of Section 11 as well as Section 23 of the Act. Under Section 11(1) of the Act in a case where an application for eviction has been filed by a landlord under Section 10 of the Act, the tenant is precluded from contesting the application before the Controller, unless he has paid or pays to the landlord, or deposits with the Controller, as the case may be, all arrears of rent due in respect of the building up to the date of payment or deposit, and continues to pay or deposit the subsequent rents falling due in respect of building until the termination of the proceedings before the Controller. Section 11 (3) of the Act enables the Controller to decide summarily the rent payable or to be deposited, in case there is any dispute regarding that. The consequences flowing from a failure on the part of the tenant to pay or deposit the rent, is provided under Section 11 (4) of the Act, wherein provisions are made enabling the Controller to stop all further proceedings and direct the tenant to put the landlord in possession of the building. By Section 11(1), (3) and (4) of the Act, tenant shall not be entitled to contest the application before the Rent Controller, unless the arrears of rent are either paid or deposited. Likewise, the tenant cannot also prefer an appeal, under Section 23 of the Act against any order made by the Controller on the application, unless the arrears of rent are either paid to the landlord or deposited before the appellate authority. The avowed object of the aforesaid provision under Section 11(1) of the Act is that undue advantage of the pendency of the proceedings under Section 10 of the Act should not be taken by the tenant with a view to not pay the arrears of rent or the rents as and when they fall due, be it in the course of the proceedings before the Controller or the Appellate Authority, as the case may be. The phraseology employed in Section 11 of the Act is not without significance in that a specific reference is made to an application for eviction under Section 10 of the Act. It is such an application that the tenant is precluded from contesting before the Controller, unless the arrears of rent or subsequent rents are either paid or deposited. The reference to the appeal under Section 23 of the Act, is against any order made by the Controller on the application. Obviously, the reference to an appeal under Section 23 of the Act against any order made by the Controller on the application, can have reference only to an appeal preferred before the Appellate Authority, with reference to an order passed by the Controller under Section 10 of the Act. The content of the expression, “any order made by the Controller on the application” cannot, therefore, be enlarged and extended to include an order dismissing an application to set aside the ex parte order of eviction, against which an appeal had been preferred under Section 23, of the Act in this case. Bearing in mind the object as well as the scheme of Section 11(1) of the Act, it is at once obvious that in cases where an application for eviction is filed by the landlord against a tenant under section 10 of the Act, the tenant will be entitled to contest the application before the Rent Controller only on payment or deposit of the arrears of rent and subsequent rents and likewise, he can also prefer an appeal against the order of eviction passed by the Controller under Section 10 of the Act, only if he pays or deposits the arrears of rent in respect of the building and continues to pay or to deposit the subsequent-rents till the termination of the proceedings before the Appellate Authority. To include within Section 11(1) of the Act, appeals under Section 23 of the Act, arising out of orders passed other than on an application under Section 10 of the Act would be to virtually enlarge the scope of Section 11(1) of the Act and also to confer on landlords a benefit not at all intended to be so conferred on them nor been warranted by the actual language employed under Section 11(1) of the Act.”….

(emphasis supplied)

The view of Ratnam, J., Gokulakrishnan, J., Wahab, J., and R. Balasubramanian, J as extracted above, in our considered view deserves to be preferred as reflecting the correct and fair interpretation of the statutory provision, besides a just and reasonable approach.

64. M. Srinivasan, J., as he then was in Ravichandran v. N. Sulaiman, reported in 1996 (1) CTC 3, held thus: —

“The view expressed by the Appellate Authority that the appeal filed by the respondent herein, without making a deposit as required by Section 11 of the Tamil Nadu Buildings (Lease and Rent Control) Act is maintainable is erroneous. The appellate authority has placed reliance in Raviram v. Somasundaram (1984) I MLJ 52). He has overlooked that the matter has been considered in detail in several other judgments of this court including S.K Rajapandian v. A. Kesavan (1991 2 L.W 453). In that judgement. I have referred to the judgement in Raviram v. Somasundaram (1984 I MLJ 52) and distinguished the same. I have followed the judgement of a Division Bench in Kuppana Chettiar v. Ramachanadran ((1980) 93 L.W 656 = AIR 1981 Madras 35). Unfortunately, the lower appellate court has not taken note of any of those judgments. Hence, the order passed by the Appellate Authority holding that appeal is maintainable and that there should be an order of stay are unsustainable.”

65. With respect, we are not persuaded to sustain this view taken by the learned Judge. That apart the Learned Judge had referred to the judgement of a Division Bench in Kuppana Chettiar v. Ramachandran, reported in (1980) 93 L.W 656 = AIR 1981 Madras 35, The said Division Bench judgement, namely Kuppanna Chettiar v. Ramachandran reported in 93 L.W 656 (D.B); arose out of Tamil Nadu Cultivating Tenants Protection Act. In the said case the Division Bench had to consider the question whether in a revision which arose under the cultivating Tenants Protection Act the tenant has to comply with the direction in the interlocutory application and whether a deposit so made pending a revision is a continuation of the earlier proceedings pending the revision petition in terms of an earlier order passed by the Revenue Court will relieve of the default, it was held that any deposit made by a tenant in terms of the interim order of stay by the revisional court staying the execution of the order for eviction passed by the authorised officer can never be tantamount to compliance with the conditional order passed by the Authorised officer.

66. In our considered view, the said decision of the Division Bench is an authority only for the said proposition laid down therein and it will be too much to read the said judgement to rely on a legal position, which has not been decided nor it arose and on that assumption it is not reasonable or fair to conclude that no appeal is maintainable without depositing the rents or arrears of rents. With respect, we has-ten to point out that such question had not arisen before the said Division Bench and therefore the reliance or inference or strength sought to be drawn by placing reliance on the decision of the Division Bench in Kuppanna Chettiar v. Ramachandran in our view is hardly acceptable and cannot be sustained.

67. Another Division Bench of this Court in R. Radha v. C.R Govindarajulu, reported in 91 L.W 443 = AIR 1978 Madras 389, is being relied upon very heavily to hold that rents should be deposited as a condition precedent to prefer an appeal against an order passed even under section 11(3) and (4) of the Act. The Division Bench in R. Radha v. C.R Govindarajulu had no occasion to consider or to decide this point, nor such a point had been advanced or decided by the said Division Bench. The pronouncement of this Division Bench is valid for the proposition that an application under section 11(4) is not maintainable pending a revision petition before this court under Section 25 of the Act.

68. While discussing the said point, the Division Bench had considered the scope of Section 11. The Division Bench in fact to a certain extent held that section 11 is not capable of general application to all proceedings under the Act before every one of the authorities functioning under the Act. In that context, the Division Bench held thus: —

“We are unable to share this view also. In fact, from the extract given above, the learned Judge has not considered the exact scope of the provisions contained in Section 11 (1) and S. 11 (1) and S. 11(4) of the Act. As we have pointed out already, S. 11(1) is careful enough to pick out only two situations and deal with the same, the two situations being an application filed by the landlord under S. 10 of the Act and the tenant contesting the same before the Controller, and an appeal preferred by the tenant before the appellate authority under Section 23, of the Act against an order passed on an application by the landlord under Section 10. No other situation is contemplated by the language of Section 11 and therefore Section 11 is not capable of general application to all proceedings under the Act before every one of the authorities functioning under the Act.”

Therefore, in our considered view, this Division Bench is not an authority for the proposition now sought to be argued nor it could be suggested that the Bench had occasion to consider such a contention.

69. In the earlier pronouncement referred to above, to a certain extent the learned Judges have drawn inspiration from the Judgement of the Division Bench in R. Radha v. C.R Govindarajulu. But, in our considered view the said two Division Bench judgments are not an authority for the proposition that before preferring an appeal against an order passed under Section 11(3) and (4) the appellant has to deposit the arrears as decided as a condition precedent for the appeal. That was not the rule or dicta of the said Division Benches. It is well settled that a decision or pronouncement is an authority only in respect of the proposition of law raised and decided and not every discussion which finds a place.

70. In Union of India v. Dhanwanti Devi, reported in 1996 (6) SCC 44, the Apex Court held that the essence of the decision and its ratio is binding and not every observations or discussions found therein. In that context, the Apex Court held thus: —

“It is not everything said by a Judge while giving judgement that constitutes a precedent. The only thing in a Judge's decision binding a party is the principle upon which the case is decided and for this reason it is important to analyse a decision and isolate from it the ratio decidendi. According to the well settled theory of precedents, every decision contains three basic postulates — (i) findings of material fact, direct and inferential. An inferential finding of facts is the inference which the judge draws from the direct, or perceptible facts: (ii) statements of the principles of law applicable to the legal problems disclosed by the facts: and (iii) judgement based on the combined effect of the above. A decision is only an authority for that it actually decides. What is of the essence in a decision is its ratio and not every observation found therein nor what logically follows from the various observations made in the judgement. Every judgement must be read as applicable to the particular facts proved, or assumed to be proved, since the generality of the expressions which may be found there is not intended to be exposition of the whole law, but governed and qualified by the particular facts of the case in which such expressions are to be found. It would, therefore, be not profitable to extract a sentence here and there from the judgement and to build upon it because the essence of the decision is its ratio and not every observation found therein. The enunciation of the reason or principle on which a question before a court has been decided is alone binding as a precedent. The concrete decision alone is binding between the parties to it, but it is abstract ratio decidendi, ascertained on a consideration of the judgement in relation to the subject matter of the decision, which alone has the force of law and which, when it is clear what it was, is binding. It is only the principle laid down in the judgement that is binding law under Article 141 of the constitution. A deliberate judicial decision arrived at after hearing an argument on a question which arises in the case or is put in issue may constitute a precedent, no matter for what reason, and the precedent by long recognition may mature into rule of stare decisis. It is the rule deductible from the application of law to the facts and circumstances of the case which constitutes its ratio decidendi.”

Following this pronouncement of the Apex Court, we hold that the Division Bench of this Court in AIR 1981, Mad. 35 = 93 L.W 656 (D.B) and AIR 1978 Mad. 389 (D.B) are not authority for the proposition that the arrears should be deposited as a condition precedent even in respect of an appeal against an order under Sec. 11(3) or (4) of the Act. The reliance placed by the Judges on the said two Division Bench as a precedent is not the correct legal position and this has led them to take such a view.

71. Section 10, as already pointed out provides that a tenant shall not be evicted in execution of a decree or otherwise except in accordance with the provisions of Section 10 or Section 14 to 16. Section 10(2) (i) provides for eviction on the ground of non payment of rent. Eviction is possible only on grounds stipulated in the section and the parties also cannot contract out of the statute. Section 11 provides that no tenant shall be entitled to contest the application for eviction or prefer an appeal unless he has paid or pays to the landlord or deposits with the Controller, all arrears of rent due in respect of the building up to the date of payment or deposits and continues to pay or deposit the subsequent rents falling due in respect of the building, until the termination of the proceedings before the controller or the appellate authority, as the case may be. Section 11(3) provides that when there is any dispute as to the amount of rent to be paid or deposited under sub section (1), the Controller shall determine by making such enquiry the rent payable or to be deposited on the application made to him by either of the parities. Section 11(4) provides the consequence that if any tenant fails to pay or deposit the arrears of rent the Rent Controller shall stop all further proceedings and make an order directing the tenant to put the landlord in possession.

72. The entire Sections 11 and 23 should be read together and as a whole. Neither Section 11, nor the Rule provides that the payment of arrears is a condition precedent either to contest the eviction petition or to prefer an appeal. We are not persuaded to read the section differently and hold that the tenant before contesting the application for eviction or before preferring an appeal is bound to deposit all arrears of rent as ordered or as directed under Section 11(3) or (4) is not a condition precedent. It is not the intendment of the Legislature that the tenant has to pay the arrears and only thereafter prefer an appeal or contest the proceedings as the case may be. There may be various varieties of disputes, viz., dispute may relate to the quantum, dispute may relate to the right of the petitioner to receive the rent etc., Therefore the Legislature had not rightly prescribed that deposit of rent as a condition precedent for preferring an appeal under Section 23 or to contest an order or direction issued under Sec. 11. There are cases of bona fide dispute as to the liability or as to the quantum of arrears or the period of arrears or the right to collect or obligation to pay, as the case may be.

73. Assuming that the Rent Controller had decided the same in one way or the other under Section 11 (3) or (4) and there is bona fide dispute and when the aggrieved prefers an appeal, the section do not contemplate deposit of arrears, as arrived at by the Original Authority, as a condition precedent for preferring an appeal, so also for contesting the proceedings. That is the reason sub section (3) of Section 11 provides the procedure. The procedure being an application has to be taken out and the Controller has to decide the dispute namely quantum of rent, period of default or quantum of arrears as the case may be. Even if it is arrived at, such an order or direction is subject to an appeal. That is the reason why the Legislature had not provided for the deposit of arrears as a condition precedent, much less, the admitted liability even. It is well open to the authority namely the Appellate Authority after taking up the appeal on file to pass appropriate orders either at the time of granting stay or as and when the respondent takes out an application to vacate the interim order pending appeal. Hence in our considered view the alleged arrears or arrears as claimed by the landlord need not be deposited as a condition precedent for preferring an appeal or contesting the order or direction passed under Section 11(3) or (4).

74. A reading of Section 11(3) and (4) with Section 11(1) would show that there is a purpose behind the said provision. The view that the deposit should be made as a condition precedent for preferring an appeal would mean restricting the appeal or denying the remedy of appeal, which the statute has provided for. Such a denial of appeal remedy could be, if at all, only in terms of the statutory provision, which is not the case here. In a given case where substantial amount is claimed as arrears which is disputed by the respondent and the dispute being bonafide, if the deposit is to be considered as a condition precedent, then it would result in deprivation of an appeal remedy. That is not the intendment or object of the Legislative provision. Even in a case where a direction is issued under section 11(4) and when such a direction is challenged by invoking the remedy of appeal under section 23, the contention that as a condition precedent the direction should be complied with by the tenant by depositing the amount as arrived at by the Rent Controller and if the tenant is required to deposit, then it would mean deprivation of a remedy of appeal, which again is not the intendment of the Legislature. Neither Section 11 (3) or (4), nor Section 23 would justify such a construction, viz., that rents claimed by the landlord or as adjudicated by the orders of the Rent Controller should be deposited as a condition precedent for preferring an appeal, or else the appeal cannot be entertained at all.

75. The statutory provision namely Section 11 (3) and (4) read with S. 23 should be given a plain meaning in juxtaposition to Section 11(1) read with Section 23. On a plain reading, we are not able to persuade ourselves to accept the plea that arrears of rent as adjudicated by the Rent Controller under section 11 (3) and (4) should be deposited as a condition precedent. Such a condition precedent is not provided for, nor it could be read into it. If such a condition precedent is to be construed it should have been provided specifically in section 11(3) or (4) or in section 23 or by a Rule. This is not so. The right of appeal has been recognised by the judicial decisions as a right which vests in a suit or at the time of institution of the original proceeding itself.

76. The phraseology viz., “to contest or prefer”. The said expression does not mean that as a condition precedent the tenant has to deposit the entire arrears for preferring an appeal. However, we hasten to add that as and when an appeal is preferred and taken on file, subject to the tenant satisfying the requirement of the statutory provision of the Act and the Rules, it is for the Appellate Authority while granting interim stay or vacating the same to pass such order including orders directing the tenant to deposit either the admitted arrears or such portion of arrears, which it deems just or proper in his view.

77. It is not necessary to remand or pass orders on merits in the revision as already this court directed the appellate authority to dispose the appeal and it is reported that the main appeal itself has since been disposed finally on merits.

78. For the foregoing discussions, we are not persuaded to approve the views taken by M. Srinivasan, J., as he then was, in S.K Rajapandian v. A. Kesavan, (1991 2 L.W 453 and in Ravichandran v. N. Sulaiman (1996 1 CTC 30, the views taken by M. Karpagavinayagam, J., in P.K Periasamy Nadar & Sons v. S. Sakthivel (1997 2 CTC 241), and in M.S. Murugan v. Santhakumari and 4 others (2000 3 L.W 394). the view taken by K.A Thanikkachalam, J., in Pichai Chetty v. N.K. Muthukrishnan (1991 2 L.W 614), and hold that the said pronouncements are not good law. We sustain the view taken by R. Balasubramanian, J., in K.P Janaki Ammai & Others v. K Badrinarayanaaiah (1999 2 L.W 102), the view taken by S.M Abdul Wahab. J., in Schwartz Dasan v. K.S. Devadoss (1999 1 CTC 560) in holding that it is not a condition precedent to deposit the arrears ordered or directed to be deposited under Section 11(3) or (4) to prefer the appeal under Section 23 of the Act as correctly decided. The reference is answered in the above terms. No costs.

79. This Division Bench places on record the valuable and effective assistance rendered by the learned senior counsel appearing for either side, Mr. Gopalarathnam, learned senior counsel appearing for the Bar Association, Mr. M. Venkatachalpathy, learned senior counsel appearing for the Bar Association, Mr. Ashok Menon, learned counsel appearing for the Advocate Association and other members of the Bar.

VCJ/RR/VCS