http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 5  

PETITIONER: SHRI VIDYA PRACHAR TRUST

       Vs.

RESPONDENT: PANDIT BASANT RAM

DATE OF JUDGMENT: 21/03/1969

BENCH: HIDAYATULLAH, M. (CJ) BENCH: HIDAYATULLAH, M. (CJ) MITTER, G.K.

CITATION:  1969 AIR 1273            1970 SCR  (1)  66  1969 SCC  (1) 835  CITATOR INFO :  D          1979 SC1307  (7,8,9)  D          1980 SC 138  (4,5,6,8,9,10,12,13,14)  O          1980 SC1709  (3,4,5,14,16,17,23)

ACT: East  Punjab Urban Rent Restriction Act,  1949-S.  13(2)(1)- Eviction for non-payment of rent-Deposits in court under  s. 31 Relief of in- debtedness Act, 1934-Whether equivalent  to tender of rent to landlord.

HEADNOTE: The  appellant landlord made an application under s.  13  of the  East  Punjab Urban Rent Restriction Act, 1949  for  the respondent’s  eviction from certain premises on  the  ground that  the -rent ’for the premises from October 1959 to  June 1961  had -not been paid.  On the first day of  hearing  the respondent  appeared  and  tendered part of  the  rent.   He claimed  that he had made two deposits in the court  of  the Senior  Sub-Judge under s. 31 of the East Punjab  Relief  of Indebtedness  Act, 1934 and that this was a valid tender  of the  balance  rent  to the landlord.   The  Rent  Controller decided  that  the  respondent was not in  default  and  the appellate authority as well as the High Court took the  same view. On appeal to this Court, HELD : The deposit under s. 31 of the Relief of Indebtedness Act  did  not save the tenant from the consequences  of  the default  as  contemplated  by  s.  13  of  the  Urban   Rent Restriction Act. [70 F] Section  31  is  intended to  operate  between  debtors  and creditors  where  difficulty in making the  payment,  either wholly  or  partly, may arise in the debtor wishes  to  save himself  from  interest which is running.  The  Act  is  not intended  to operate between landlords and tenants;  nor  is the Court of the Senior Sub-Judge a clearing house for rent. Although the general words "any person who, owes money"  may appear to cover the case of a tenant, looking at the Act  as a  whole, the phrase must be read to cover cases of  debtors and  creditors  between  whom the-re  is  an  agreement  for payment of interest because the deposit is intended to  stop interest from running.  No interest is agreed to be paid  by

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 5  

tenants,  at  any rate, nor ordinarily, and  therefore,  the section  cannot be said to cover a case between  a  landlord and a tenant. [69 F-H]

JUDGMENT: CIVIL APPELLATE JURISDICTION :Civil Appeal No. 499 of 1966. Appeal  by special leave from the judgment and  order  dated March  18, 1964 of the Punjab High Court in  Civil  Revision No. 750 of 1962. Bishan Narain and Naunit Lal, for the appellant. N. N. Keswani, for the respondent. Janardan Sharma and S. K. Nandy, for the intervener. The Judgment of the Court was delivered by. Hidayatullah,  C.J. This is a landlord’s appeal  against  an order  of  the  High  Court  of  Punjab,  March  18,   1964, confirming 67 the  dismissal  of  his petition for  the  eviction  of  the respondent  from  certain  premises  taken  on  rent.    The appellant  had made the application under S. 13 of the  East Punjab  Urban Rent Restriction Act, 1949 on  the  allegation that rent for the premises from October 1, 1959 to June  30, 1961  had not been paid.  The rent of the premises  was  Rs. 32/8/- and the water connection charges were Rs. 2/8//-.  On the  first date of hearing the tenant appeared and  tendered Rs.  292/8/- as rent from October 1, 1960 to June 30,  1961. He  also  paid Rs. 7/- as interest and Rs.  25/-  as  costs. These   amounts  were  accepted  by  the  landlord   without prejudice to his claim that the rent for the earlier  period had not been paid. It  appears  that the tenant had made two  deposits  in  the Court  of the Senior Sub-Judge, Ludhiana under s. 31 of  the East Punjab Relief of Indebtedness Act, 1934 on December 23, 1959  and  July  18, 1960, the amount being  210/-  on  each occasion.   The tenant claimed that this was a valid  tender of rent to the landlord.  The Rent Controller, by his order, decided that the tenant was not in default and the Appellate Authority  and the High Court also took the same  view.   It was held by the Appellate Authority, as well as by the  High Court,  that  the  deposit  under s. 31  of  the  Relief  of Indebtedness Act was a valid tender under s. 13 of the Urban Rent Restriction Act.  The Division Bench in the High  Court followed  an earlier decision of the same Court reported  in Mam  Chand  v.  Chhotu  Ram(1).   The  correctness  of  that decision as well as the decision under appeal are challenged before us. Before  the hearing commenced the respondent took  Objection to the grant of the special leave stating that the appellant was   guilty  of  making  "certain  inaccurate  untrue   and misleading statements in respect of certain material facts". The charge was that before the Rent Controller there was  no issue  that  the  deposit  under s.  31  of  the  Relief  of Indebtedness  Act  was a valid tender of  payment,  although this  was  mentioned as a fact in the petition  for  special leave.   It  was also said that this question was  given  up before  the Appellate Authority although it was stated  that the point was decided by the Appellate Authority.   Reliance was  placed  in this connection upon two decisions  of  this Court  reported in Hari Narain v. Badri Das(2) and  Rajabhai Abdul  Rehman Munshi v. Vasudev Dhanjibhai  Mody(3).   These were  cases of gross misstatement where the  party  applying for  special  leave had deliberately chosen  to  make  false statements  and false pleas.  In the present case  the  same

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 5  

cannot  be  said  of the appellant.  There I  was  only  one issue, before the Court and it was whether the deposit (1)  1. L. R. (1964) 1 Pb. 626.           2. [1964] 2 S.  C. R. 203. 3.   [1964] 3 S. C. R. 480 68 under  one Act was good for the purposes of the  other  Act. All that the courts had to consider was whether that deposit saved  the  tenant  from eviction or not.   The  High  Court mentioned that this was the only point before all the courts below and we do not think that the complaint that there  had been  any false averment in the petition for  special  leave was  sustainable.  We accordingly -rejected the  contention, raised by C.M.P. No. 64 of 1969. As regards the merits of the case s. 1 3 (2) (1) of the East Punjab Urban Rent Restriction Act reads as follows               "13.  Eviction of tenants.               (1)   A tenant in possession of a building  or               rented land shall not be evicted therefrom  in               execution  of a decree passed before or  after               the commencement of this Act or otherwise  and               whether before or after the termination of the               tenancy,   except  in  accordance   with   the               provisions of this section, or in pursuance of               an  order made under-section 13 of the  Punjab               Urban   Rent   Restriction   Act,   1947,   as               subsequently amen               (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  applicant,   is               satisfied-               (i)   that the tenant has not paid or tendered               the rent due by him in respect of the building               or  rented land 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  agreement, by the last day  of  the               month  next following that for which the  rent               is payable :               Provided  that  if  the tenant  on  the  first               hearing of the application for ejectment after               due  service  pays or tenders the  arrears  of               rent and interest at six per cent per annum on               such   arrears  together  with  the  cost   of               application  assessed by the  Controller,  the               tenant  shall be deemed to have duly  paid  or               tendered the rent within the time aforesaid." The  Act does not lay down any other procedure  under  which -money can be deposited with any Government Authority.  Such provisions  are to be found in other Rent Control  Acts  but are  missing in this Act.  Eviction, therefore, takes  place on  the ground of non-payment or tender of rent  due  within time fixed by the 69 tenancy  and 15 days thereafter.  There is only  one  saving for the tenant and that is when he tenders the full rent  in Court before the Rent Controller together with interest  and costs.  In the present case, the tenant did tender rent  but only  for  a  portion of the period and  he  relied  on  his deposit  under  the  Relief  of  Indebtedness  Act  as   due discharge  of his liability for the earlier period.  It  may be  stated that the deposit before the Senior  SubJudge  was made not only of arrears of rent but prospectively for  some

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 5  

future  period  for which the rent was then  not  due.   The question  is  whether  such payment is a  valid  payment  or tender to the landlord. Section  31  of  the Relief of  Indebtedness  Act  reads  as follows :-               "31.  Deposit in court.               (1)   Any  person  who owes money may  at  any               time  deposit in court a sum of money in  full               or part payment to his creditor.               (2)   The  court  on receipt of  such  deposit               shall give notice thereof to the creditor  and               shall, on his application, pay the sum to him.               (3)   From  the date of such deposit  interest               shall cease to run on the sum so deposited." This  Act  was  passed to govern the  relation  between  the debtors  and  creditors.  The scheme of the Act  bears  upon this   relationship  because  it  provides  for   insolvency procedure,   usurious   loans,   damdupat,   redemption   of mortgages,  deposit in court, and sets up Debt  Conciliation Boards, suitably amending the civil law wherever  necessary. Incidentally,  it provides for deposit in court with a  view to  giving  a  chance to debtors to  save  interest  on  the outstanding  dues either wholly or partially.  The  section, therefore,  is  intended  to  operate  between  debtors  and creditors  where  difficulty in making the  payment,  either wholly  or partly, may arise and the debtor wishes  to  save himself  from  interest which is running.  The  Act  is  not intended  to operate between landlords and tenants;  nor  is the  Court of the Senior Sub-Judge created into  a  clearing house for rent.  Although the general words "any person  who owes  money"  may appear to cover the case of a  tenant,  we have  to look at the Act as a whole and see what kind  of  a person  is  intended thereby.  The phrase must  be  read  to cover  cases of debtors and creditors between whom there  is an agreement for payment of interest because the deposit  is intended  to  stop interest from running.   No  interest  is agreed  to be paid by tenants, at any rate, nor  ordinarily, and, therefore, the, section 70 cannot  be  said to cover a case between a  landlord  and  a tenant.  There is no provision in the Urban Rent Restriction Act  for  making a deposit except one, and that  is  on  the first  day  of the hearing of the case.  It could  not  have been intended that all tenants who may be disinclined to pay rent  to their landlords should be enabled to deposit it  in the Court of a Senior Sub-Judge making the Senior Sub-Judge, a kind of a Rent Collector for all landlords.  The provision for  stoppage of interest is a pointer that the interest  in the first instance must have been due.  In our judgment,  S. 31  has  been  misunderstood in the High  Court.   A  second pointer  is that the amount may be deposited in  part  which cannot  possibly be a valid tender in case of rent.  It  may be pointed out that the decision of the Division Bench  runs counter to two other decisions of single Judges of the  same High Court who have taken the same view which we are  taking here.   The decisions are noticed by the Division Bench  but have not been accepted.  The decisions of the learned single Judges are to be preferred.  The Division Bench has taken  a very extended view of    the  deposit  under the  Relief  of Indebtedness Act. Further  the  deposit of money in the present case  was  not only of   the rent due but also of future rent.  Under s. 19 read with s.   6  of  the  Urban  Rent  Restriction  Act   a landlord is liable to be sent to jail if he recovers advance rent  beyond one month.  It is impossible to think that  the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 5  

landlords would be required to go to the Court of the Senior Sub-Judge  with a view to finding out whether their  tenants have deposited rent due to them or not.  No doubt there is a provision  for  sending a notice, but we do not  think  that that notice is intended to cover such cases.  On the  whole, therefore, we are of opinion that the deposit under s. 31 of the Relief of Indebtedness Act did not save the tenant  from the consequences of the default as contemplated by s. 13  of the  Urban Rent Restriction Act.  We accordingly  allow  the appeal  and, setting aside the judgment of the  High  Court, order  the eviction of the tenant from the  premises  rented out  by him.  He shall have three months’ time in  which  to vacate  the  premises.  The costs throughout  must  also  be borne by the respondent. R.K.P.S.              Appeal allowed. 71