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PETITIONER: M/S CHORDIA AUTOMOBILES

       Vs.

RESPONDENT: S.  MOOSA & ORS.

DATE OF JUDGMENT:       29/02/2000

BENCH: A.P.Misra, N.S.Hegde

JUDGMENT:

     MISRA, J.

     This  appeal  is directed against the eviction of  the appellant  on  account of default of payment of  rent  under Section 10(2)(i) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960.

     The  appellant took the disputed shop situated at  71, Usman  Road, T.  Nagar, Madras on rent in the year 1972 from the  erstwhile  owner who sold this property to the  present respondents  in  the year 1977.  The rent then paid  by  the appellant  was at the rate of Rs.275/- p.m.  Thereafter,  it was  raised  to  Rs.   343.75  p.m.   from  1.4.1979.   Next enhanced  to  Rs.500/- p.m.  w.e.f.  1.9.1985.  In the  year 1988 the appellant desired to change his business from spare parts  of  two-wheelers to sale of tyres, then the rent  was again increased to Rs.750/- p.m.  The appellant desired that for selling of tyres he needs to install air-conditioner and compressor  with water connection for checking of tubes  and fitment of tyres.  This also requires additional electricity load, a water tap and a separate lavatory.  For doing these, the  appellant  offered and respondent agreed  on  condition that  the  rent  be  further   enhanced  from  Rs.750/-   to Rs.1,000/-  p.m.  On this oral agreement the appellant spent about  Rs.1,00,000/- on renovation.  However, the respondent failed  to  discharge  their obligations for  providing  the aforesaid  additional facilities despite repeated  requests. On respondents failure to do so, the appellant filed a suit against him that the landlord was not entitled to claim this enhanced  rent of Rs.1,000/- p.m.  In support he stated that on  the ground floor there are nine shops including the  one with  the  appellant, similarly situated, but none of  these shops have any rental of Rs.1,000/- p.m.

     Instead  of  complying with the said  conditions,  the appellant   received  respondents   notice  dated  9.8.1989 through his advocate that the agreed rent of Rs.1,000/- p.m. from 1.4.1989 has not been paid in spite of demands.  Before any reply could be sent the appellant was served with a copy of  the  eviction proceedings dated 27.9.1989 under  Section 10(2)(i) of the aforesaid Act.  The appellant contested this claim  that enhancement agreed to pay Rs.  1,000/- was on  a clear  understanding  that  the   respondent  would  provide separate  toilet,  water connection, additional  electricity

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load etc.  In fact, during the pendency of the said petition the counsel for the appellant wrote a letter dated 17.1.1990 to  the  counsel  of the respondent for getting  the  three- phase electric connection for the shop in question.

     Since  there was a dispute in respect of rate of  rent the  Rent  Controller  passed an order under Section  11  on 30.7.1990  directing  the appellant to  deposit  Rs.17,250/- towards  the rent for the period 1.1.1989 to 31.7.1990.  The aforesaid  amount was directed to be paid by 16.8.1990.  The appellant  deposited the said amount in the treasury of  the court  on 13.8.1990 and thereafter continued to  pay/deposit the  rent  at  the rate of Rs.750/- p.m.  initially  in  the court  and  then directly to the respondents who  thereafter accepted  the  same.   Thus, there has been  no  conceivable default.   However, the Rent Controller decreed the petition of  the  respondent.   The  Rent Controller  held  that  the respondent  did not pay the arrears of rent even till filing of  the  counter in the said petition and it was  paid  only when  Order under Section 11 was passed which constitutes to be  wilful  default.   On appeal,  the  Appellate  Authority confirmed  the said order.  The Appellate Authority records, in  spite of receiving the aforesaid notice, Ex.  P-2,  the appellant  did not sent any reply to contradict the contents of  the  said  notice.   Finally   the  revision  was  also dismissed by the High Court against which the present appeal has been preferred.

     Learned  counsel  for the appellant submits  that  the Rent  Controller without application of mind held, appellant to  be wilful defaulter.  The Appellate Authority also  fell into the same error, while confirming the order.  It records not  sending  any  reply to the said notice  dated  9.8.1989 amounts  to  non-controverting the facts and not  depositing the rent within the time stated therein constitute a case of wilful  default.   Submission  is, the authorities  did  not properly  construe Explanation I to Section 10 (2)(i) of the Act.  The said notice is dated 9.8.1989, thus wilful default under  the  aforesaid  provisions could  only  mature  after expiry  of  60  days from the date of the notice  and  since before  the  expiry  of  that  period,  the  landlord  filed eviction  petition  on  20.9.1989, hence on  that  date  the appellant  could not be said to be a wilful defaulter nor it was  possible  for the appellant to send any reply,  as  the eviction suit itself was filed before the expiry of the said 60  days.   For ready reference Section 10(2)(i)  is  quoted hereunder:-

     10.   Eviction  of tenants.(1) A tenant shall not  be evicted whether in execution of a decree or otherwise except in  accordance  with  the  provisions  of  this  section  or sections 14 to 16:

     (2)  A  landlord who seeks to evict his  tenant  shall apply  to the Controller for a direction in that behalf.  If the  Controller,  after  giving   the  tenant  a  reasonable opportunity  of  showing cause against the  application,  is satisfied

     (i)  that the tenant has not paid or tendered the rent due  by him in respect of the building, within fifteen  days after  the  expiry  of the time fixed in  the  agreement  of tenancy  with  his  landlord or in the absence of  any  such

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agreement,  by the last day of the month next following that for which the rent is payable, or

     ..   Provided  that  in any case  falling  under clause  (i) if the Controller is satisfied that the tenants default  to  pay  or  tender rent was not  wilful,  he  may, notwithstanding  anything contained in section 11, give  the tenant a reasonable time, not exceeding fifteen days, to pay or tender the rent due by him to the landlord up to the date of such payment or tender and on such payment or tender, the application shall be rejected.

     Explanation  I:  For the purpose of this sub- section, default  to pay or tender rent shall be construed as wilful, if  the  default by the tenant in the payment or  tender  of rent  continues after the issue of two months notice by the landlord claiming the rent.

     {Emphasis supplied}

     In  support that there was no default, it is submitted that always in the past, the rent was regularly collected by the  agent  of the landlord as for some reasons he  did  not come  to  collect the amount fell in arrears.   Further,  as dispute  arose  of  the hike of the rent  with  effect  from 1.4.1989,  the  arrears  fell due, thus on these  facts,  it would  not  constitute  to  be a  case  of  wilful  default. Further,  Explanation  to Proviso of Section 10(2) makes  it clear  that  the wilful default could only be if the  tenant defaults after the expiry of two months from the date of the notice,  and as this period did not expire when the suit was filed,  the  finding of wilful default is liable to  be  set aside.   However,  when  an order was passed  under  Section 11(4)  fixing  tentative rent the amount so  determined  was paid within the period granted.  For all these reasons, even if  it could be said that there was default, it would not  a wilful  default.  This aspect had not been considered by any of  the  authorities including High Court,  which  summarily dismissed  the revision.  He has also taken us to the  chart filed  by the appellant, to show that he never defaulted  in the  past except the disputed one since the year 1972.   The default referred to in the notice is for the period 1.1.1989 to 31.3.1989 at the rate of Rs.750/- p.m.  and from 1.4.1989 to  31.7.1989 at the rate of Rs.1,000/- p.m.  So far arrears for  the  second  period 1.4.1989 to  31.7.1989,  admittedly there  was a dispute of rate of rent.  For the first period, i.e.,  from  1.1.1989  to 31.3.1989, for a period  of  three months,  the  case  is  that as  rent  was  being  collected regularly earlier by the agent of the landlord and as he did not  come to collect the same, the arrears fell due.  It  is further submitted, the chart shows for the subsequent period also  that appellant has been paying rent regularly  without any default.

     On  the other hand, learned counsel for the respondent submits  that fixation of rent under Section 11 and  payment thereafter is no defence for the default.  This adjudication is interim in nature and is subject to the final decision by the  court.  Further, in spite of notice, neither any  reply was sent by the appellant nor the amount was tendered.  Even thereafter  he  took number of adjournments before the  Rent Controller,  hence  all  this constitute to be a case  of  a wilful default.

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     We  have  heard  learned counsel for the  parties  and examined  their  submissions and made overall assessment  to judge,  whether  any wilful default was committed or not  by the  tenant.   It is not disputed by the landlord  that  the appellant  is a tenant of this accommodation since 1972  and was regularly paying the rent in the past.  The only default is,  as aforesaid, for the disputed period from 1.1.1989  to 31.3.1989 at the rate of Rs.750/- p.m.  and from 1.4.1989 to 31.7.1989  at  the  rate of Rs.  1000/-  p.m.   These  facts reveal  that  there is a default towards payment of rent  by the  tenant for the aforesaid period.  The only question is, whether  this default on these facts would constitute to  be or could be construed to be a wilful default?  We proceed to examine  the  law on these facts.  The statute has  given  a benefit  to a tenant viz., if there is default in payment of rent  and a notice is sent by the landlord of such  default, then  the default would mature into a wilful default only if the default continues in other words the defaulted amount is not  paid  within  a period of two months from the  date  of notice.   In the present case, notice was sent on  9.8.1989, thus  the  said  two months would have expired only  on  the 9.10.1989.   In  other words, in case the tenant could  have paid  the said amount within this period, it would not be  a case  of wilful default.  We find in the present case  after sending  the said notice, the landlord did not wait for  the expiry of the said period and before that filed the eviction petition  R.C.O.P.  No.  2963 of 1989 on 20.9.1989  alleging the  wilful default and further if the suit itself was filed before the said period there could be no question of sending any  reply  to  the  said  notice.   Next,  we  find  notice contained  amount which fell into arrears is of two periods. The  amount  for  the  period   1.4.1989  to  31.7.1989  was admittedly  in  dispute.   In fact for  this  reason  during pendency,  a proceeding to fix interim rent under section 11 was  initiated.   The tenant reasonably thought to  pay  the same  after its adjudication and in fact deposited the  same the  moment it was adjudicated.  So far the earlier  period, i.e.   1.1.1989  to 31.3.1989 for three months, the case  of the  appellant is that tenants long dependency in the past, on  the agent of the landlord to collect the rent and as  he did  not  come, thus rent could not be tendered,  thus  this could not be a case of wilfully not paying the rent.  It may be,  as  enhancement of rent came in dispute, the agent  did not  come  to  collect  the rent.  We have  given  our  full consideration,  and  find submission for the  appellant  has force,  which  has not been adverted to by any of the  three courts  below.  This coupled with Explanation to the proviso of  Section 10 (2)(I) as two months did not expire from  the date of notice when suit was filed it could not to be a case of wilful default.

     Wilful   default   means  an    act   consciously   or deliberately  done with open defiance and intent not to  pay the  rent.  In the present case the amount of rent defaulted firstly is on account of fact that the agent of the landlord did  not come to collect the rent for some reason.  Further, notice  of  default  contained  disputed  rent.   This  fact coupled  with  the fact that eviction suit was filed  before maturing   a  case  of  wilful   default  in  terms  of  the Explanation to the proviso of Section 10(2).  The dispute of rent  admittedly  was genuine.  Further, we find conduct  of the  appellant  throughout  in  the  past  being  not  of  a defaulter  or  irregular  payer of rent.   Thus,  all  these circumstances  cumulatively come to only one conclusion that the appellant cannot be held to be a wilful defaulter.

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     In   S.    Sundaram  Pillai   and  Ors.    Vs.    V.R. Pattabiraman  and  Ors.  (1985 [1] SCC 591) this  Court  had occasion to consider the word Wilful default under Section 10(2)  of  the aforesaid of the Tamil Nadu Buildings  (Lease and Rent Control) Act, 1960 which is reproduced below:-

       Before, however, going into this question  further, let  us  find out the real meaning and content of  the  word wilful  or  the  words wilful default.  In  the  book  A Dictionary  of  Law by L.b.  Curzon, at page 361  the  words wilful and wilful default have been defined thus:

     Wilful- deliberate conduct of a person who is a free agent,  knows that he is doing and intends to do what he  is doing.

     Wilful   default    Either   a   consciousness   of negligence  or  breach  of duty, or a  recklessness  in  the performance of a duty.

     In   other  words,  wilful   default  would  mean  a deliberate  and  intentional default knowing full  well  the legal  consequences  thereof.  In Words and Phrases,  Volume 11-A  (Permanent Edition) at page 268 the word default has been  defined as the non-performance of a duty, a failure to perform  a  legal  duty  or  an  omission  to  do  something required.   In  volume  45 of Words and  Phrases,  the  word wilful has been very clearly defined thus:

     Wilful      intentional;      not   incidental   or involuntary;

     -   done  intentionally,   knowingly,  and  purposely, without justifiable excuse as distinguished from an act done carelessly;  thoughtlessly, heedlessly or inadvertently;

     - in common parlance word wilful is used in sense of intentional,   as   distinguished     from   accidental   or involuntary.

     P.   296    Wilful refers to  act  consciously  and deliberately  done and signifies course of conduct marked by exercise  of  volition  rather  than  which  is  accidental, negligent or involuntary.

     In  Volume  III of Websters Third  New  International Dictionary  at page 2617, the word wilful has been defined thus :

     governed by will without yielding to reason or without regard to reason;  obstinately or perversely self-willed.

     The  word  default  has been defined  inVol.   I  of Websters  Third  New International Dictionary at  page  590 thus :

     to fail to fulfil a contract or agreement, to accept a responsibility;  to fail to meet a financial obligation.

     In  Blacks Law Dictionary (Fourth Edn.), at page 1773 the word wilful has been defined thus:

     Wilfulness  implies  an act done  intentionally  and designedly;    a   conscious  failure   to   observe   care;

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conscious;   knowing;   done with stubborn purpose, but  not with malice.

     The  word reckless as applied to negligence, is  the legal equivalent of wilful or wanton.

     Thus,  a consensus of the meaning of the words wilful default  appears  to indicate that default in order  to  be wilful  must  be  intentional,  deliberate,  calculated  and conscious, with full knowledge of legal consequences flowing therefrom.   Taking  for  instance  a case  where  a  tenant commits  default  after  default  despite  oral  demands  or reminders  and  fails  to pay the rent without any  just  or lawful  cause,  it cannot be said that he is not  guilty  of wilful  default because such a course of conduct  manifestly amounts  to wilful default as contemplated either by the Act or other Acts referred to above.

     For  the foregoing reasons and as per our findings  we come  to  the  irresistible conclusion that  all  the  three courts  below committed error in law in holding tenant to be a  wilful defaulter.  So, we hold even if he was in  default it  is  not  a  case of wilful default.  We  hold  that  the appellant  committed  no wilful default.   Accordingly,  the impugned  orders  and judgments of all the three courts  are hereby  set aside.  The appeal is allowed.  However, on  the facts  and  circumstances  of  the case, the  costs  on  the parties.