Prakash Bhalotia (D) Thr His Lrs vs Indra Chandra Goyal (D) Thru.Lrs

REPORTABLE 2024 INSC 941

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 10855 OF 2024 [@ SPECIAL LEAVE PETITION (C) NO. 24041 OF 2013]

PRAKASH BHALOTIA (D) THR HIS LRS APPELLANT(S)

VERSUS

INDRA CHANDRA GOYAL (D) THRU. LRS RESPONDENT(S)

ORDER

1. Leave granted.

2. Challenging the judgment dated 22.01.2001 passed in Suit

No. 1 of 1992 by Small Causes Court dismissing the suit for eviction

filed by landlord due to ‘non­payment of rent’, ‘subletting’, and ‘expiry

of rent agreement’, as affirmed by the High Court vide impugned

judgment dated 31.01.2013, the present appeal has been filed.

3. The facts leading are that appellant (now deceased) was the

owner of Shop No. 4 (Western Direction) situated in Mohalla Begupur,

Muglani, Ram Prasad Bhalotia Market, District Gorakhpur city with

the Signature Not Verified prescribed boundaries shown in the suit. The Digitally signed by Jayant Kumar Arora

defendant/respondent (now deceased) was inducted as a tenant on a Date: 2024.12.09 10:54:14 IST Reason:

monthly rent of ₹ 330/­. The tenancy was for a fixed period of five 2

years, which started from 01.07.1985 and ended on 30.06.1990. As

per the terms of tenancy, on expiry of period of five years, the tenant

may continue with increase of rent @ 15 % per month provided the

same is agreeable to the owner.

4. It was averred in the suit that neither plaintiff – landlord

intimated about construction of shop to Municipality nor Municipality

recorded the same on its own and did the tax assessment of the shop

in 1972. On objections being raised by plaintiff/landlord, the same

was admitted by the Municipality. The plea of sub­letting has also

been averred, but it is not being dealt here as the said ground has not

been pressed during hearing. As contended, after expiry of the period

of tenancy, it was not renewed by consent and the respondent – tenant

became unauthorized occupant of the shop. However, as per

agreement, for the period of overstay, he ought to pay ₹ 1,000/­ per

month. Therefore, due to non­payment of rent, notice was issued for

termination of tenancy, which was not responded to by

defendant/respondent – tenant.

5. On filing suit, defendant entered appearance and filed the

written statement, inter­alia, stating that plaintiff did not have right to

bring the suit, and claimed protection under Section 20 of The Uttar

Pradesh Urban Buildings (Regulation of Letting, Rent and Eviction) 3

Act, 1972 (hereinafter referred to as “UP Rent Act”). It was averred

that, prior to the fresh tenancy agreement dated 13.03.1986, which

was from 01.07.1985 for five years, defendant was a tenant since

1977, therefore, being in continuous tenancy, the same would not

extinguish and he would be entitled to protection available under

Section 20 of the UP Rent Act, if rent is deposited in the Court under

Section 30 of the said Act.

6. Learned Trial Court, on Issue No. 4 noted that from the

agreement it can be determined that the tenancy was not for a definite

period of five years. On Issue No. 5 it was held that the benefit under

Section 20(4) of the UP Rent Act is available to the tenant. Further,

Issue No. 6 which relates to default in payment of the rent, it was

concluded against the landlord and in favour of tenant and hence, suit

was dismissed.

7. The revision filed against the judgment of the Trial Court was

dismissed by the High Court, observing that in revisional jurisdiction,

re­appraisal of evidence is not permissible, and consequently findings

of the Trial Court were affirmed.

8. Being dissatisfied, the present appeal has been preferred,

inter­alia, submitting that tenancy was for 5 years, and ended on

30.06.1990. The tenancy was monthly in nature and the rent was 4

payable on month­to­month basis. As per Clause 14, such tenancy

may be extendable, by consent of the landlord with monthly increase

of rent @ 15%, after entering into registered agreement. In absence

thereof, Clause 6 of the agreement would attract and the defendant be

treated an unauthorized occupant and liable to pay ₹ 1000/­ per

month as penalty for overstay.

9. It is contended that the rent and the penalty, as agreed in

the lease agreement, has not been deposited even on receipt of the

notice by the Court within the time and the respondent – tenant was

in default of payment of rent even during pendency of proceedings.

This Court vide order dated 18.09.2018 directed the respondent­

tenant(s) to file affidavit giving details of the rent deposited within a

week. Thereafter, four weeks’ time was granted to deposit arrears of

rent and taxes etc. Later, one more opportunity of four weeks was

granted to comply the said orders. In compliance, the respondent –

tenant filed an affidavit and explained that the rent as agreed above

after expiry of the period of tenancy has been deposited, including

House Tax as detailed therein.

10. The contention of appellant – landlord is that the findings of

Trial Court on Issue No. 6 is vague and referring to the documents, he

submitted that respondent – tenant is in default in depositing month 5

to month rent as per UP Rent Act. Therefore, the findings are

completely perverse and contrary to the record placed before this

Court.

11. Per contra, learned counsel for the tenant – respondent(s)

has taken us through the findings of the Trial Court on Issue Nos. 4, 5

and 6 and submitted that in absence of any material controverting

those findings, re­appraisal in exercise of power under Article 136 of

the Constitution of India ought not to be done. It is contended that the

affidavit filed is only regarding arrears of rent and taxes during

pendency, therefore, it cannot form basis to set aside the findings of

the Trial Court which dismissed the suit seeking eviction. Learned

counsel further made an attempt while referring various documents

filed subsequently stating that, the rent which was due has already

been deposited.

12. During hearing, it was not disputed by learned counsel for

the parties that the provisions of the UP Rent Act are applicable to the

suit filed by the appellant – landlord for eviction. Therefore, we are

inclined to appreciate the findings recorded on this issue by the Trial

Court as affirmed by the High Court.

13. In the UP Rent Act, ‘tenant’ has been defined in Section 3(a)

as “a person by whom its rent is payable, till his death.” Further Section 6 7 deals with ‘Liability to pay taxes’ which specifies ‘subject to any

contract in writing to the contrary, but notwithstanding the provisions of

Section 149 of the Uttar Pradesh Municipalities Act, 1916, the tenant

shall be liable to pay to the landlord the taxes i.e. water tax, house tax,

in addition to the part of the rent.’ Section 20 of the UP Rent Act, in

Chapter­IV, stipulates about bar of suit for eviction of tenant except on

specified grounds and provides protection to the tenant as specified.

Section 20(2)(a) of the UP Rent Act makes it clear that a suit for

eviction of a tenant after determination of his tenancy may be

instituted on the ground, where the tenant is in arrears of rent for not

less than four months and has failed to pay to the landlord within one

month from the date of service of notice of default upon him. Section

20(4) makes it clear that in a suit for eviction for non­payment of rent,

at the first hearing of the suit, if the tenant unconditionally pays or

tenders to the landlord or deposits in Court the entire amount of rent

including the damages for use and occupation of the building due

from him together with interest @ 9% per annum along with landlord’s

cost of the suit, after deducting any amount already deposited by him

under Section 30(1), on such deposit, the Court may pass an order

relieving the tenant against his liability for eviction. Meaning thereby,

it is clear that in case the tenant is in arrears of four months, the suit 7

may lie, but such rent may be deposited within one month from the

date of service on him. In case, the due rent along with damages and

occupation charges is not paid as required under Section 20(2)(a) of

the UP Rent Act read with Sections 20(4) and 30 of the Act, no

protection would be available as stipulated under Section 20 of the

said Act.

14. In case the landlord refuses to accept the rent, which is

required to be paid by the tenant, then such amount can be deposited

in the manner prescribed under Section 30 of UP Rent Act and the

tenant can continue to deposit rent due even for any subsequent

period until the landlord signifies by notice to accept the same by his

willingness. Therefore, it can safely be said that in addition to cause of

action to file a suit for arrears of due rent of not less than four

months, if the rent is not deposited regularly, including the damages

and the occupational charges along with the interest @ 9%, the suit

seeking eviction can be maintained and decreed.

15. As already noted, the ground of sub­letting has not been

pressed and during hearing, learned counsel for the appellant(s) –

landlord has pressed this appeal only for non­payment of rent,

therefore, we are appreciating the said issue only. In this regard, if we

peruse the findings of the Trial Court on Issue Nos. 5 and 6, then it 8

clearly indicates that such findings are relying upon Exhibits K1 to K6

– receipt of the rents and Exhibits K7 to K12 – receipts of sending the

Money Orders and Exhibits K13 and K14, which relate to deposit of

the money in the Court of Munsiff, Gorakhpur. Those documents, i.e.,

Exhibits K1 to K6 have not been produced, but placed before us. On

perusal, it is clear that those are receipts of rent for the years 1984,

1988, 1989 and K6 is receipt of 31.03.1990 depositing consolidated

rent of ₹3460/­, which is from April 1989 to March, 1990. Thus,

except receipt K6, no other receipt relates to the demand of rent by

notice in the suit. From the document Exhibits K7 to K12, it is not

clear that these Money Orders were of which period of rent. Similar is

the position with document Exhibits K13 and K14. Therefore, those

documents are not sufficient to discharge burden of payment or

deposit of rent by respondent – tenant and to shift onus on appellant –

landlord. Similarly on filing the suit on 06.02.1992, whether the rent

was regularly paid by the respondent – tenant as contemplated under

Section 20(4) including Section 30(1) of the UP Rent Act has not been

considered.

16. By the proceeding dated 18.09.2018 of the case, this Court

directed the respondent – tenant to file an affidavit giving details of the

payment of the rent. Later, directions were issued to deposit the 9

arrears of rent and taxes after filing of eviction petition. Due to non­

compliance, in a later proceeding, four weeks’ further time to comply

with the previous orders was allowed. In response, an affidavit was

filed by respondent – tenant, wherein paragraph 3, details of deposit

have been disclosed. Those details are relevant and reproduced as

thus: ­

“3. That I have deposited the rent for the shop room in the Court of the Civil Judge, Junior Division, Gorakhpur through the Sub­Treasury in Misc. Rent Case No. 71 of 2001 as shown below :­

Date of Period for which Rent Amount Deposit was Remitted Deposited 28.09.2012 October 2011 to Rs. 4554 September 2012 21.03.2013 October 2012 to Rs. 4554 September 2013 19.10.2013 October 2013 to March Rs. 2277 2014 19.04.2014 April 2014 to September Rs. 2277 2014 02.02.2015 October 2014 to Rs. 4554 September 2015 02.11.2015 October 2015 to Rs. 4554 September 2016 01.12.2016 October 2016 to Rs. 4554 September 2017 07.11.2017 October 2017 to Rs. 4554” September 2018

17. The respondent – tenant also filed an application (I.A. No. 10

61800 of 2020) seeking permission to bring additional documents on

record. The documents annexed as R1 and R3 are the receipts of

deposit of the rent from January 2019 to December 2019 and January

2020 to December 2020 in the case of Yashoda Devi and not related to

this case. Document annexed as R2 relates to this case, whereby the

respondent – tenant deposited the rent from October 2019 to March

2020 and Annexure R4 is the House Tax Receipt of ₹50,049/­

deposited in compliance of the order of this Court.

18. In this respect, appellant – landlord has also filed a

document along with I.A. No. 11110 of 2020 indicating deficit rent of

₹28462.6 and Tax of ₹1912.68 @ 24% for a period of 75 months viz.

from July 1995 to December 1995, January 1996 to December 1996,

January 1997 to March 1997, April 2002 to March 2003, April 2003 to

March 2004, October 2006 to September 2007, October 2008 to

March 2009 and October 2009 to September 2010. In the said

document, it is also specified that from October, 2001 to September,

2019, i.e., a total 216 months, the Tax has not been deposited, which

comes to ₹19,673.28 and there is a total deficit of ₹50048.56.

19. On perusal of the affidavit and the documents referred

hereinabove, it can safely be concluded that the rent from October

2011 to September 2012 was paid on 28.09.2012, hence, month to 11

month rent was not paid during this period, and the default of

respondent – tenant was there. Similarly, from October 2012 to

September 2013, the rent was deposited on 21.03.2013, thus, default

in payment of rent for October 2012 to March 2013 is clear. The rent

from April 2014 to September 2014 was paid on 19.04.2014. It shows

default of payment of rent for the month of April which was paid after

10th day of month. Similar is the position from October, 2015 to

September, 2016 and October, 2016 to September, 2017. In those

cases, there was a default of payment of rent for the months of

October 2015 and November 2016.

20. If we peruse the payment of rent from October 2014 to

September 2015, deposited on 02.02.2015, again there was a default

for October 2014 to January 2015. Therefore, from the averments of

the affidavit of the tenant, defaults in deposit of rent are clearly

luculent, which cannot be ignored.

21. By the documents Annexures R2 and R4 also, default of

continuous payment of rent during pendency either before the Trial

Court or before the High Court or before this Court has not been

rectified. During hearing, nothing has been brought on record by the

respondent – tenant to substantiate that in compliance to the

provisions of Section 20(4) and Section 30(1) of the UP Rent Act, 12

regular rent from the date of receipt of notice of the suit has been

deposited. Reference of some documents have been made by learned

Trial Court, by which it is not clear that the rent deposited by the

tenant was within the period of one month from the date of receipt of

notice and the rent was paid regularly thereafter. In addition, it is not

clear that in case of default, 9% interest has been paid.

Simultaneously, deposit in one­go after the order of this Court would

not absolve the tenant from consequence of non­payment or delayed

payment of rent.

22. As per the discussion made hereinabove, we are constrained

to hold that the tenant has not paid rent regularly during the

pendency of the suit, revision and appeal, and was in default in

payment of rent, tax and interest due. In a suit seeking eviction on the

ground of arrears of rent, if the rent is not paid during the pendency,

it can be a ground for directing eviction for non­payment of the rent.

Therefore, the findings of the Trial Court, dismissing the suit seeking

eviction, affirmed by the High Court without any appraisal of the

material, do not appear to be justified.

23. Learned counsel for the appellant – landlord has placed

reliance on a Constitution Bench decision in case of “Gian Devi

Anand Vs. Jeevan Kumar and Ors.” (1985) 2 SCC 683, whereby in 13

a Rent Control and eviction matter, this Court has specified the nature

of the statutory tenancy and its concept. It was thereby held that the

distinction between the contractual tenancy and the statutory tenancy

is obliterated by Rent Control Legislation because the contractual

tenancy would be converted into statutory tenancy. There cannot be

any doubt in this regard, particularly in the facts of the case whereby

the tenancy of the appellant, though contractual for a limited period,

but continued by virtue of applicability of the provisions of UP Rent

Act as accepted by the parties.

24. Underlying the revisional jurisdiction of the High Court in

rent eviction matters, this Court in “Shankar Ramchandra

Abhyankar Versus Krishnaji Dattatreya Bapat” (1969) 2 SCC 74,

observed that revisional jurisdiction partakes the appellate jurisdiction

of a superior Court. The right of appeal is one of entering a superior

Court and invoking its aid and interposition to redress the error of the

Court below. When the aid of High Court is invoked on the revisional

side, it is done because it is a superior Court and it can interfere for

the purpose of rectifying the error of the Court below. Further, in the

case of “Babulal Nagar and others Versus Shree Synthetics Ltd.

and others” (1984) Supp SCC 128, it was observed that jurisdiction 14

to examine the propriety of the order or decision carries with it the

same jurisdiction as the original authority to come to a different

conclusion on the said set of facts. If any other view is taken, the

expression “propriety” would lose its significance. Lastly, in the case of

“Nalakanth Sainuddin versus Koorkikadan Sulaiman” (2002) 6

SCC 1, this Court observed that once a revision petition is entertained

by the High Court, whichever be the party invoking the revisional

jurisdiction, it acquires jurisdiction to call for and examine the records

of the authority subordinate to it. Any illegality, irregularity or

impropriety coming to its notice is capable of being corrected by it by

passing such appropriate order or direction as the law requires and

justice demands.

Therefore, we are of the view that in the revision in the eviction

matter, the High Court was required to look into the material placed

and justifiability of the findings relying those documents. In absence

of its satisfaction, interference ought to be have been made by the

High Court and such revision cannot be thrown out on the ground of

limited scope of jurisdiction.

25. Coming to the case in hand, the agreement of tenancy has

been admitted with effect from 01.07.1985, on month­to­month basis 15

and rent had to be paid against receipt. The said tenancy was for a

period of five years. Clause 14 depicts that on expiry of five­year, it

may be extendable by consent of landlord with enhancement @ 15%

rent per month (claimed to be per annum). Indeed, it is true that no

agreed lease agreement was entered into after 30.06.1990, but as per

the provisions of the UP Rent Act, the tenancy would become statutory

and subject to payment of the enhanced rent, the suit can be

maintained. But, in case of consecutive default of monthly payment of

rent and continuous non­payment as specified under the UP Rent Act,

it may be a ground to grant decree of eviction.

26. In view of our foregoing discussions, it can safely be

concluded that the respondent – tenant was in default in regular

payment of monthly rent during pendency of the suit, revision before

the High Court and also before this Court. He has deposited the

amount deficit towards rent payment and house tax totaling to

₹50,048.56/­ after the direction of this Court in one­go as specified

above. The findings recorded by the Trial Court and confirmed by the

High Court are completely perverse and without appreciating the real

intent of provisions of Sections 20 and 30 of UP Rent Act, therefore,

liable to be set­aside.

27. Accordingly, we allow the appeal and set­aside the orders 16

passed by the Trial Court and the High Court and decree the suit filed

by the appellant – landlord on the ground of non­payment of arrears of

rent and direct eviction from the suit subject property.

28. In the facts and circumstances of the case, as prayed by

respondent(s) – tenant(s) we grant time up to 31.03.2025 to vacate the

suit premises subject to payment of due rent and arrears thereof, after

adjusting the amount of rent already deposited, within one month and

continue to pay regular monthly rent for the permissible period of

occupation. They shall hand over the vacant possession of the suit

premises to the appellants on or before 31.03.2025 and shall not part

with or create third party right therein. The respondents – tenants

shall file usual undertaking on affidavit in this regard within a period

of nine weeks from today before the Registrar, High Court of

Judicature at Allahabad. The violation of the aforesaid terms would

be treated as non­compliance of the order of this Court. Pending

interlocutory application(s), if any, is/are disposed of.

.....................………............J. [ J. K. MAHESHWARI ]

…………..........………...........J. [ RAJESH BINDAL ]

New Delhi;

September 25, 2024 17

ITEM NO.11 COURT NO.8 SECTION III-A

S U P R E M E C O U R T O F I N D I A RECORD OF PROCEEDINGS

Petition for Special Leave to Appeal (C) No. 24041/2013

(Arising out of impugned final judgment and order dated 31.01.2013 in CR No. 175 of 2001 passed by the High Court of Judicature at Allahabad)

PRAKASH BHALOTIA (D) THR HIS LRS Appellant(s)

VERSUS

INDRA CHANDRA GOYAL (D) THRU.LRS Respondent(s)

IA No. 105233/2024 - APPLICATION FOR SUBSTITUTION IA No. 105237/2024 - CONDONATION OF DELAY IN FILING SUBSTITUTION APPLN.

IA No. 61806/2020 - EXEMPTION FROM FILING AFFIDAVIT IA No. 61801/2020 - EXEMPTION FROM FILING O.T. IA No. 134816/2022 - EXEMPTION FROM FILING O.T. IA No. 11111/2020 - EXEMPTION FROM FILING O.T. IA No. 117423/2022 - EXEMPTION FROM FILING O.T. IA No. 105239/2024 - EXEMPTION FROM FILING O.T. IA No. 147496/2018 - EXEMPTION FROM FILING O.T. IA No. 158406/2021 - EXEMPTION FROM FILING O.T. IA No. 151031/2022 - EXEMPTION FROM FILING O.T. IA No. 151030/2022 - PERMISSION TO FILE ADDITIONAL DOCUMENTS/FACTS/ ANNEXURES IA No. 61800/2020 - PERMISSION TO FILE ADDITIONAL DOCUMENTS/FACTS/ ANNEXURES IA No. 134815/2022 - PERMISSION TO FILE ADDITIONAL DOCUMENTS/FACTS/ ANNEXURES IA No. 11110/2020 - PERMISSION TO FILE ADDITIONAL DOCUMENTS/FACTS/ ANNEXURES IA No. 117421/2022 - PERMISSION TO FILE ADDITIONAL DOCUMENTS/FACTS/ ANNEXURES IA No. 158405/2021 - PERMISSION TO FILE ADDITIONAL DOCUMENTS/FACTS/ ANNEXURES IA No. 105235/2024 - SETTING ASIDE AN ABATEMENT

Date : 25-09-2024 This matter was called on for hearing today.

CORAM : HON'BLE MR. JUSTICE J.K. MAHESHWARI HON'BLE MR. JUSTICE RAJESH BINDAL

For Appellant(s) Mr. Amitabh Chaturvedi, Adv.

Mr. Rahul Shukla, Adv.

Mrs. Bachita Baruah Shukla, Adv.

Mr. Barbeshwar Bhalotia, Adv.

Mr. Kumar Dushyant Singh, AOR 18

For Respondent(s) Ms. Aarohi Bhalla, Adv. Mr. Anupam Mishra, AOR Mr. Harikumar V., Adv.

UPON hearing the counsel the Court made the following O R D E R

Leave granted.

The appeal is allowed in terms of the signed order.

Pending interlocutory application(s), if any, is/are disposed of.

(JAYANT KUMAR ARORA) (NAND KISHOR) ASTT. REGISTRAR-cum-PS COURT MASTER

(Signed order is placed on the file)