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Bijoy Singh Nahata v. Mohanlal Chaudhuri Opposite Party.

Calcutta High Court
May 21, 1954
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Structured Summary of the Opinion delivered by P.N. Mookerjee, J.

Factual and Procedural Background

The petitioner (tenant) occupied two shop rooms at 196 Cross Street, Calcutta; the rent on 1 December 1941 was Rs. 62-10-0 per month. In August 1946 the landlord applied for fixation of standard rent under the Rent Control Act then in force. On 14 March 1950 the Rent Controller fixed the standard rent at Rs. 171-4-0 per month with effect from 1 September 1949. Both parties appealed; appeals were dismissed on 5 October 1950 with liberty to apply under the Rent Control Act of 1950 for refixation. The tenant applied for refixation on 30 October 1950, and on 28 December 1950 the Rent Controller fixed the standard rent at Rs. 68-14-0 per month with effect from 1 April 1950. The landlord's appeal was dismissed by the Court of Small Causes on 23 June 1951, with a modification of effective date to 1 November 1950. Both parties then sought revision in this Court; on 5 September 1952 the Court set aside the appellate order and earlier refixation proceedings and directed re-hearing in light of section 17(2) of the 1950 Act. The re-heard appeals had not been finally disposed of at the time of this opinion.

Meanwhile, on or about 23 December 1952 the landlord instituted Ejectment Suit No. 3230 of 1950 in the Court of Small Causes alleging, among other things, that the tenant was not entitled to rent control benefits due to default. The tenant filed a written statement and contested. On 14 February 1953 the landlord applied under section 14(4) of the Rent Control Act of 1950. On 20 June 1953 the trial Judge ordered the tenant to deposit arrears and current rent at the standardised rate of Rs. 171-4-0 per month less credit for amounts deposited (Rs. 68-14-0), resulting in a directed deposit of Rs. 102-6-0 per month for the period August 1949 to May 1953, and threatened striking off the defence on default.

The tenant challenged the propriety of that trial court order by way of the present Rule. The Court delivered the opinion addressing interpretation of section 14(4) of the West Bengal Premises Rent Control (Temporary Provisions) Act, 1950 and ultimately made the Rule absolute in part, modifying the trial court order and directing specified deposits.

Legal Issues Presented

  1. How should the phrase "the rate at which it was last paid" in section 14(4) of the West Bengal Premises Rent Control (Temporary Provisions) Act, 1950, be interpreted — does "last paid" refer to the rate of the last actual payment, the rate of the last deposit with the Rent Controller, or to the rate legally payable ("payable") at the relevant time?
  2. Whether the statutory phrase "last paid" governs both (a) the monthly "current rent" to be deposited month by month and (b) the "arrears of rent", or whether the phrase applies only to current rent while arrears must be deposited at the rate legally payable at the time of the order.
  3. Given the factual history of payments and deposits in this case, at what rates must the tenant deposit (a) arrears from 1 September 1949 onward and (b) future monthly/current rent under section 14(4)?

Arguments of the Parties

Tenant-Petitioner's Arguments

  • The tenant contended that under section 14(4) there were no arrears to be deposited because the tenant had deposited "arrears of rent" from 1 September 1949 with the Rent Controller at Rs. 68-14-0 per month prior to the landlord's application under section 14(4).
  • The tenant argued that the rate for both "current rent" and "arrears" under section 14(4) should be the rate at which rent was last paid — either (i) the last actual payment of Rs. 62-10-0 per month (paid 12 May 1949) or, at most, (ii) the last deposit amount of Rs. 68-14-0 per month deposited with the Rent Controller — and thus the tenant should not be ordered to deposit at the standardised rate of Rs. 171-4-0.

Landlord-Opposite Party's Arguments

  • The landlord maintained that the relevant rate for both arrears and current rents to be deposited under section 14(4) is the standard rent of Rs. 171-4-0 per month, which had been fixed on 14 March 1950 and, until set aside or modified by an appropriate order, remained in force and governed the parties' rent relationship for the purposes of section 14(4).
  • The landlord relied on the view that "paid" in the provision should be read to mean rent legally payable (i.e., "payable") at the relevant time — effectively linking the rate to the standardised rate still regarded as prevailing.

Constructions Discussed in Argument

  • First (tenant's extreme): "last paid" should govern both current rent and arrears; rate would be the last actual payment (Rs. 62-10-0) or, if a later deposit with the Rent Controller counts as payment, Rs. 68-14-0.
  • Second (landlord's extreme): "last paid" should be read as "payable" (i.e., legally payable) so that both current rent and arrears follow the standardised rent (Rs. 171-4-0) if that rate is legally effective.
  • Third (middle): "last paid" used in the statute should be read in its natural sense and restricted to qualifying the rate of current rent only; arrears should be governed by the rate legally payable at the time of the order under section 14(4).

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The Court began from the textual and structural analysis of section 14(4), recognising ambiguity but preferring a cautious and rational interpretation. It considered the three constructions advanced in argument and rejected both extremes in favor of the third construction (restricting "last paid" to current rent only).

Key steps in the Court's analysis:

  1. Meaning of "paid" versus "payable": The Court held that "paid" in its natural meaning is distinct from "payable" and saw nothing in the context to justify treating "paid" as "payable." Accordingly it rejected the landlord's suggested substitution of "payable" for "paid."
  2. Syntactic and structural analysis: The Court examined the placement of the qualifying phrase "the rate at which it was last paid" in the section. It noted that the rate-language explicitly accompanies references to "current rent" (via the words "at such rate") while references to "arrears of rent" appear without an explicit rate qualifier. The Court viewed this structural distinction as deliberate and significant.
  3. Natural meaning of "arrears of rent": The Court held that "arrears of rent" should be understood as "arrears of rent legally payable" with reference to the relevant time — which the Court determined to be the date of the order under section 14(4).
  4. Rejection of tenant's extreme construction: The Court rejected the tenant's argument that the last paid rate must govern arrears as well, observing that such a reading would reward dishonest tenants (those who never paid any rent would escape the section), an outcome the statute could not reasonably be taken to intend.
  5. Interaction with section 20(3) of the 1950 Act: The Court accepted that, under section 20(3) of the Rent Control Act of 1950, "paid" as regards rent may include a deposit made with the Rent Controller if the amount deposited would have been sufficient to be a valid legal tender of rent. To determine the rate of the "last paid" rent for current rent purposes, the Court would therefore look to the later of (a) the last actual payment and (b) the last deposit that would have been valid legal tender (i.e., covered the legally payable rent at that time).
  6. Application to the facts: The Court applied the legal conclusions to the case facts. It found:
    • Last actual payment to the landlord was Rs. 62-10-0 on 12 May 1949.
    • There was a subsequent deposit with the Rent Controller at Rs. 68-14-0, but that deposit was made after 1 September 1949 when, on the basis of the Rent Controller's order of 14 March 1950 and subsequent proceedings, the standardised rent of Rs. 171-4-0 must be deemed to have been and to be in force until set aside or varied.
    • Because the standardised rent remained in force until set aside, the deposit of Rs. 68-14-0 made after 1 September 1949 could not be regarded as a valid legal tender of rent under section 20(3) (it did not cover the legally payable rent at the relevant time).
    • Consequently, for section 14(4) purposes the "last paid" rate (for current rent) was the last actual payment of Rs. 62-10-0, while arrears must be paid at the rate legally payable at the time of the order — i.e., the standardised rate of Rs. 171-4-0.
  7. Practical result and judicial caution: The Court acknowledged the possibility of anomalous situations (two different rates arising for current rent and arrears) but found that the statutory language and structure compelled this conclusion if a just and reasonable interpretation was to be given.

Holding and Implications

HOLDING: The Court held that under section 14(4) of the West Bengal Premises Rent Control (Temporary Provisions) Act, 1950 the deposit required by a tenant under that section must be made as follows:

  • For "current rent" (month by month): at the rate at which rent was last actually paid (or at the rate of the last deposit constituting valid legal tender if later) — in this case Rs. 62-10-0 per month (the last actual payment).
  • For "arrears of rent": at the rate legally payable or recoverable at the time the order under section 14(4) is made — in this case the standardised rate of Rs. 171-4-0 per month.

The Court modified the trial court order accordingly and made the Rule absolute in part, directing that the tenant deposit within fifteen days all arrear rents from September 1949 up to the end of April 1954 at Rs. 171-4-0 per month, and from May 1954 onward to deposit current rent month by month at Rs. 62-10-0 per month within fifteen days of the next following month. The tenant was given the option to seek credit in respect of deposits already made with the Court or Rent Controller; the lower court was directed to consider such claims on the merits and pass appropriate orders. The parties were directed to bear their own costs of the Rule.

Implications:

  • Direct effect on the parties: The trial court order is modified to require the split treatment of rates — arrears at the then-legally payable (standardised) rate, current monthly deposits at the rate last actually paid (here Rs. 62-10-0).
  • No broader implications discussed by the Court in this opinion beyond the decision's effect on the parties and the interpretation of section 14(4) as applied to the facts of this case: the opinion does not expressly set out any broader rule or announce additional precedent beyond resolving the statutory interpretation in this matter.

End of summarized opinion (based exclusively on the text provided).

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The Judgment of the Court was delivered by

P.N Mookerjee, J.:— This Rule raises an important and interesting question of first impression. That question relates to the interpretation of section 14(4) of the West Bengal Premises Rent Control (Temporary Provisions) Act, 1950. There is doubtless some ambiguity in the relevant statutory language which has given rise to controversies and unnecessary complexities.

2. The revelant facts are not in dispute and they stand as follows:—

The petitioner is a tenant under the opposite party in respect of two shop rooms in premises No. 196, Cross Street, Calcutta. On 1st December, 1941, the rental of the said tenancy was Rs. 62-10-0 per month. In August, 1946, the landlord applied for fixation of standard rent under the Rent Control Act of 1948 which was then in force and, on 14th March, 1950, the Rent Controller fixed the standard rent at Rs. 171-4-0 per month with effect from 1st September, 1949. From the said order there were appeals preferred by both the parties. Those appeals, however, were dismissed on 5th October, 1950, giving liberty to the parties to apply for refixation of standard rent under the Rent Control Act of 1950 which had come into force in the meantime. The application for refixation of the standard rent was filed by the tenant on 30th October, 1950, and this was disposed of by the Bent Controller on 28th December, 1950, standardising the rent at Rs. 68-14-0 per month with effect from 1st April, 1950. The landlord's appeal against this decision was dismissed by the learned Fourth Judge, Court of Small Causes, Calcutta, on 23rd June, 1951, subject to a slight modification as to the date from which the new standard rent would take effect, that date being altered to and specified by the learned Judge as 1st November, 1950. Aggrieved by this appellate order both parties moved this Court in revision when, on 5th September, 1952, the said order and the entire rent refixation proceedings as also the order, dated the 5th October, 1950, on which the same were based, were all set aside and the original appeals before the Court of Small Causes, arising out of the standardisation proceedings under the 1948 Act, were directed to be re-heard according to law by the learned Chief Judge personally in the light of the provisions of section 17(2) of the 1950 Act. Thereafter the matter has moved from Court to Court but the appeals have not yet been finally disposed of. In the meantime, on or about 23rd December, 1952, the landlord-opposite party had instituted against the tenant-petitioner Ejectment Suit No., 3230 of 1950 in the Court of Small Causes, Calcutta, upon the allegation inter alia that the said tenant was not entitled to the benefit of the rent control law because of default in the payment of rent. The tenant appeared, filed written statement and raised a contest. On 14th February, 1953, the landlord applied for an appropriate order under section 14(4) of the Rent Control Act of 1950. On 20th June, 1953, the application was allowed by the learned trial Judge by his order of that date in which he observed inter alia as follows:—

“It is admitted that the standard rent originally fixed for the premises in suit in R.C Case No. 3116A of 1949 on 14.3.50 was Rs. 171-4-0 per mensem. Subequently under Act of 1950 the standard rent was refixed at Rs. 68-14-0 per month by the learned Rent. Controller. In revision Hon'ble High Court dismissed the application for refixing the standard rent and held that there was no hearing of the appeal against the decision of the Rent Controller in case No. 3116A of 1949 by competent authority and that the appeal was deemed to be pending. So the standard rent originally fixed at Rs. 171-4-0 remains effective till now. As such under sec. 14(4) of the West Bengal Premises Rent Control Act the defendant is liable to deposit rent at that rate. Arrears of rent are due from August, 1949, to May 1953. It is admitted that the defendant has been depositing with the Rent Controller rent at Rs. 68-14-0 regularly. So the defendant is entitled to get? deduction of this amount. Therefore the defendant is ordered to deposit arrears of rent at Rs. 171-4-0 per month less Rs. 68-14-0 per month as has been deposited, i.e, Rs. 102-6-0 per month for the period from August, 1949, to May, 1953, and this amount will come to Rs. 4,760-7-0. Defendant to deposit this sum of Rs. 4,760-7-0 as arrears of rent and the current damages at Rs. 171-4-0 per month every month by the 15th of the succeeding month within 15 days from this date. In default, the defence shall be liable to be struck off.”

3. The propriety of this order under section 14(4) has been challenged in this Rule.

4. It is an admitted fact that the; last payment of rent actually made to the landlord was on 12th May, 1949, when Rs. 62-10-0 was paid and received as the rent of Chait Bodi 2005 Sam-bat. Thereafter rents were duly deposited with the Rent Controller up to 31st August, 1949. Admittedly also, before the application under section 14(4) was filed by the landlord, the tenant had deposited with the Rent Controller the “arrears of rent” from 1st September, 1949, at the rate of Rs. 68-14-0 per month. On these facts the tenant contended in the trial court—and that is also his contention in this Court—that there were no arrears to be deposited under section 14(4) of the West Bengal Premises Rent Control (Temporary Provisions) Act, 1950, and that the “current rent” deposits also ought to be directed under that section at the same rate of Rs. 68-14-0 per month at the maximum, this contention being based upon the view that under the said statutory provision the rate for “current rents” and also for arrears would be the rate at which rent was last paid, that is, Rs. 62-10-0 per month, the rate of the last actual payment of rent, or, at the most, Rs. 68-14-0 per month, the rate of the last deposit with the Rent Controller, if such deposit be held to be payment under the statute. The landlord in his turn contended— and that contention has been repeated in this Court—that the relevant rate for both arrear and “curent” rents, to be deposited under section 14(4); of the Rent Control Act of 1950, would be the standard rent of Rs. 171-4-0 per month, which had not till then,—and has not as yet,—been set aside or modified by any appropriate order under the law, and which, therefore, was—and still remains—unaffected in law and ought to prevail and govern the relation between the parties in the matter of rent for purposes of the said section 14(4) of the Act of 1950.

5. In our opinion, none of the above two contentions can be accepted. The structure and the phraseology of the section are no doubt not very happy and may afford some justification for the two extreme contentions on either side but a cautious and rational approach is all that is needed to ascertain the true meaning of the words used by the Legislature.

6. During arguments in Court three possible constructions came up for discussion. One was the extreme construction, suggested by the petitioner, namely, that the words “last paid”, appearing in the statute, governed or qualified not only the rate of the “current rent”, in connection wherewith they were expressly used, but also the rate of arrear rent. That was said to be the true grammatical construction of the language, employed by the Legislature, and, according to the petitioner's learned Advocate, this common rate would, in the present case, be Rs. 62-10-0 per month, at which rate rent was last paid actually or, at the most, it would be Rs. 68-14-0 per month, at which rate it was last deposited with the Rent Controller. The ether extreme construction was suggested by the learned Advocate for the opposite party who also agreed that there ought to be one common rate for both “current” and arrear rents but who submittted that the word “paid” in the body of the section really meant “payable” or legally payable at the relevant time. The third construction sought to interpret the words “last paid” in their natural sense but it would restrict those words to the rate of “current rent” in relation to which they appear to have been actually and expressly used by the statute and this third construction would not extend those words by implication to the other part, viz., that dealing with arrear rents, and would not connect them with the rate of arrear rent. For reasons which we shall presently give this third construction appears to us to be preferable to the other two and we have no hesitation in accepting it.

7. The word “paid” in its natural meaning is certainly different from “payable” and there is nothing compelling, either in the context or in the subject-matter, to justify a departure from this natural meaning. On the other hand, the qualifying word “last” which immediately precedes it in the phrase quoted does, in our opinion, sufficiently indicate and emphasise payment or actual payment either in fact or in law. We reject, therefore, the construction, suggested on behalf of the opposite party.

8. We are also disinclined to hold that the words “last paid” were intended to qualify not only the rate of “current rent” but the rate of arrears too. We are not satisfied that any rule of grammar compels us to read the words “the rate at which it was last paid” as governing “arrears of rent”. The structure of the first or the principal relevant clause and also of the subsequent relevant clauses is against such construction and, significantly also, a studied distinction appears to have been maintained between the “current rent” and the arrears, wherever the section has referred to the rate. Thus the principal clause speaks of “order on the tenant-defendant to deposit month by month rent at a rate at which it was last paid and also the arrears of rent, if any”; the clause following speaks of “an order for deposit of rent at such rate month by month and the arrears of rent, if any” and the last relevant clause refers to the “failure of the tenant to deposit the arrears of rent within fifteen days of the date of the order or the rent at such rate for any month by the fifteenth day of the next following month”. While, therefore, the mention of the rate, that is, the “rate at which it was last paid”, accompanies or virtually accompanies (vide the words “at such rate”) every reference to the “current rent”, the section is silent about the rate when it speaks of arrear rent [vide the extracts quoted with particular reference to the underlineations (italics in this report— Ed.)] and when this is viewed against the background furnished, in particular, by the manner of interposition of the rate between the several words used by the statute to denote “current rent” in the last two clauses quoted, the distinction, noticed above, is well and sufficiently confirmed. The other clause also sufficiently shows that the mention of the rate goes along with the “current rent” and the “arrears of rent” stands singularly apart. These are features which cannot be ignored in construing the section and, to our mind, they support strongly the distinction to which we have drawn particular attention above.

9. We have already rejected the petitioner's argument that, as a matter of grammatical construction, the rate, mentioned in the earlier part, that is, in connection with the “current rent”, would necessarily be attracted to the arrears rent and, in that context, the distinction, noticed in the preceding paragraph, and the contrast, as provided by the words underlined [italics in this report— Ed.] in the extracts quoted, are highly significant and we are inclined to think that the non-mention of the rate in connection with “arrears of rent” is deliberate so as to leave unaffected the plain and natural meaning of that expression. The word “the” which precedes that expression in each of the clauses quoted also appears to lend some support to this view. The plain and natural meaning of the expression “arrears of rent” is, undoubtedly “arrears of rent legally payable” with reference, of course, to the relevant time, which, as we shall presently hold, so far as section 14(4) of the Rent Control Act of 1950 is concerned, is the date of the order under that section, and that meaning will determine the rate of arrear rents under that statutory provision.

10. It has been pointed out to us that, in certain parts of the statute, the expression “rent legally payable” has been expressly used but we do not think that the suggested contrast is very material in the present context or that the mere omission or absence of the words “legally payable” in section 14(4) of the Act would imply that the words “arrears of rent” in that section were intended to mean anything else than “arrears of rent legally payable” as explained above. We, therefore, reject the petitioner's extreme argument on this point.

11. From the foregoing discussion it fairly follows that, for purposes of section 14(4) of the Rent Control Act of 1950, the rate of “current rent” would be the rate at which rent was last paid but, as to arrears, payments will have to be made at the rate legally payable or recoverable at the time when the order under that section is made. We are quite conscious that this interpretation may sometimes lead to some anomalies in that in the payment of rent under this section there may be two different rates—one for the “current rent” and the other for the arrears. But, having regard to the language used in the statute and the structure of the relevant clauses, there is no help in the matter. In the face of the statutory language no other conclusion also seems to be possible if a just and reasonable interpretation has to be put upon the section.

12. We have noted above the three possible constructions. The first, namely, that suggested by the opposite party, is plainly unacceptable in the face of the statutory language, the second, that is, the petitioner's suggestion, does not appeal to us for reasons, already given, and also for the reason that its acceptance would mean putting a premium on dishonesty. A dishonest tenant who has never paid any rent would be wholly outside the mischief of the section and would be in a far happier position than one who, although a defaulter on some occasions, has been more honest in the matter of payment of rent. That was hardly contemplated by the statute and we are not prepared to put such an unreasonable interpretation upon it in the absence of compelling circumstances. We hold, therefore, that, under section 14(4) of the West Bengal Premises Rent Control (Temporary Provisions) Act, 1950, the deposit of “current rent” would be at the rate at which rent was “last paid” but deposit of arrears would be at the rate, legally payable or recoverable at the time.

13. It is also to be remembered that under the Rent Control Act of 1950 “paid” in relation to rent means either actually paid or deposited in accordance with law “if the amount deposited would have been valid legal tender of rent” [vide section 20(3)], that is, sufficient for that purpose. To be sufficient for a valid legal tender of rent that amount must cover the rent, legally payable, which, when the matter arises under section 14(4), must mean legally payable at the time of the order under that section. In determining, therefore, the rate at which rent was “last paid” for purpose of section 14(4) of the Rent Control Act of 1940, we have to ascertain the rate of the last actual payment or the last deposit, as explained above, whichever is later, and to adopt that rate as the rate of the “current rent”, to be paid under the said section 14(4).

14. In the view of the law, as laid down above, the position in the present case may be summed up as follows:—

Admittedly, the last actual payment of rent was at the rate of Rs. 62-10-0 per month. Admittedly also, the last deposit of rent with the Rent Controller was at the rate of Rs. 68-14-0 per month but, as it was made after 1.9.49, since when and even up till now, the standardised rent of Rs. 171-4-0 per month must be deemed to have been, and to be, in force as a result of the various proceedings had up till this date, the said deposit cannot be held to constitute “payment of rent” under section 20(3) of the Act. The fact that the said standardization is still under appeal does not alter the position as, until it is set aside or varied, it must foe held to be prevailing except for purposes of res judicata. In that view of the matter, the rent, legally payable at the relevant time, would be the said standardised rent of Rs. 171-4-0 per month.

15. It thus follows that, under section 14(4) of the Rent Control Act of 1950, the tenant-petitioner in the present case will have to deposit arrear rents at the rate of Rs. 171-4-0 per month and “current rent” at the rate of Rs. 62-10-0 per month, and the order of the trial Court will have to be modified accordingly.

16. We may note here in this connection that it has been represented to us by the tenant-petitioner that, since the issue of this Rule, he has deposited in the Court below sufficient amounts so as to wipe off all arrears, calculated at the rate of Rs. 171-4-0 per month from 1st September, 1949. That fact cannot, however, be verified by us as the necessary materials are not in this Court.

17. We, accordingly, make this Rule absolute in part and direct that, under section 14(4) of the Rent Control Act of 1950, the tenant-petitioner should deposit within fifteen days from this date all arrear rents from 1st September, 1949, that is, from and including the month of September, 1949, up to the end of April, 1954, at the rate of Rs. 171-4-0 per month and will go on depositing month by month thereafter, that is, from May 1954, “current rent” at the rate of Rs. 62-10-0 per month within fifteen days of the next following month; in default he will be liable to the consequences, mentioned in the said section 14(4). We further direct that, in making the above deposits, the tenant-petitioner will be entitled, at his option, to ask for credit of the deposits, already made by him in Court or with the Rent Controller, and the Court below will consider his said prayer on the merits and will pass appropriate orders thereon in accordance with law. Further consequential orders are also to be made by the Court below in accordance with law. In the circumstances of this case, we direct that the parties will bear their own costs in this Rule.

Sen, J.:— I agree.

A.K.D.G