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PETITIONER: SULEMAN NOORMOHAMED ETC.  ETC.

       Vs.

RESPONDENT: UMARBHAI JANUBHAI

DATE OF JUDGMENT23/02/1978

BENCH: UNTWALIA, N.L. BENCH: UNTWALIA, N.L. SARKARIA, RANJIT SINGH

CITATION:  1978 AIR  952            1978 SCR  (3) 387  1978 SCC  (2) 179

ACT: Civil   Procedure  Code-Order  23  Rule  3-While   recording compromise whether court should mention that the  compromise is  lawful-Can  it  be presumed-Bombay  Rent  Act  1947-Sec. 12(3)b-Decree   based  on  compromise  whether  a   nullity- Statutory  ground for eviction whether can be made out  from the  material  before  the court-Compromise  deed  by  which tenant  agrees  to pay arrears of rent as  demanded  in  the plaint, if sufficient.

HEADNOTE: The  appellant landlord filed a suit against the  respondent tenant  claiming  a decree for eviction on grounds  of  non- payment  of  rent  and for bonafide  personal  necessity  in accordance  with the Bombay Rents, Hotel and  Lodging  House Rates  Control  Act, 1947.  The respondent filed  a  written statement.  An exparte decree was passed which was set aside on the application of the respondent.  Ultimately, the  suit was  disposed  of  on the compromise  between  the  parties. According  to the terms of the compromise the tenant was  to hand  over possession of the suit premises to  the  landlord within  a period of 3 years.  The tenant did not  vacate  on the expiry of the period and contested the execution on  the ground that the decree was a nullity.  The Trial Court  held that  the  decree  was a nullity.  That  was  upset  by  the Appellate  Court.   The  High Court  accepted  the  Revision Application filed by the tenant and held that the compromise decree,  is  a nullity and. therefore, cannot  be  executed. The  High Court held that the order passed by the Court  did not  disclose any satisfaction recorded by the  Court  about the  existence of one or more grounds of eviction under  the Act, and in the compromise pursis also there is no admission on the part of the tenant express or implied. Allowing the appeal, HELD : 1. It has been laid down by the Court in the case  of Nagindas  Ramdas  that  existence of any  of  the  statutory grounds is a sine quo non to the exercise of jurisdiction by the  Rent Court in order to enable it to make a  decree  for eviction.   It  was also laid down that if at  the  time  of passing  of  the decree there was some material  before  the Court  on the basis of which the Court could be prima  facie satisfied  about  the existence of a  statutory  ground  for

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eviction  it  would  be  presumed  that  the  court  was  so satisfied  and  the decree for  eviction  though  apparently passed  on the basis of a compromise would be  valid.   This Court  also held that such material might take the shape  of either  of  evidence  recorded or  produced  or  express  or implied  admission made in the compromise agreement  itself. In Roshanlal’s case this Court field that the Court can pass a  decree  on the basis of a compromise and that in  such  a situation  the  only  thing  to  be  seen  is  whether   the compromise is in violation of the requirements of law.  [389 C-G] Nagindas  Ramdas v. Dalpatram Ichharam @ Brijram  and  Ors., [1974]  2 S.C.R. 544 and Roshan Lal v. Madan Lal,  [1976]  2 S.C.R. 878, relied on. 2.   There is abundant intrinsic material in the  compromise itself to indicate that the decree passed upon its basis was not  in violation of the Act but was in accordance With  it. If  there  is  no  dispute about the  standard  rent  or  no bonafide dispute or the dispute raised is a mere pretence of it a decree can follow under section 12(3)(b) of the Act  in a suit in which rent is not due for 6 months of more but  is due  even  for  lesser  period.  The  tenant  will  get  the protection  against eviction in such a case only if he  pays or tenders in court on the first date of hearing of the suit or  such  other date as the Court may fix.  In  the  instant case, the High Court was not right that on the face 3 88 of  the compromise pursis or the order passed thereon  there was no material to show that the tenant had either expressly or impliedly suffered a decree for eviction as being  liable to  be evicted in accordance with section 12(3) (b).   While recording the compromise under order 23 rule 3 of the  Civil Procedure Code, it is not necessary for the Court to say  in express  terms in the order that it was satisfied  that  the compromise  was a lawful one.  It will be presumed  to  have done  so unless the contrary is shown.  But that  apart,  on examination  of the plaint which certainly should be  looked into and which must have been in the records of the Court at the  time of passing of the compromise decree, it  would  be found  that  landlords had claimed arrears of rent  for  two months  at the rate of Rs. 17/- per month and mesne  profits also  for  one month upto the date of the suit at  the  same rate.   They had also claimed electricity charges @ Rs.  2/- per  month.  In the compromise petition the same  amount  of rent, mesne profit and electric charges are admitted by  the tenants to be payable to the landlords.  There is nothing to indicate  that any genuine dispute was raised by the  tenant in  regard to the standard rent or the electric charges  nor is there anything to show that he had ever filed a  Petition under  section 11 of the Act or any other provision  of  law for fixation of standard rent.  Nor was he able to show that the  Court at his request had ever fixed any other date  for payment of the said amount.  In view of his admission in the compromise  deed to pay the rent as demanded it is  manifest that  there  was  no dispute in the case in  regard  to  the standard  rent.  The facts clearly show that the tenant  had incurred  liability to be evicted under the said  provisions of law and the compromise decree was passed on the  tenant’s impliedly admitting such liability. [390 F-G, 391 C-D,  E-H, 392 A-B]

JUDGMENT: CIVIL APPELLATE JURISDICTION : Civil Appeal No. 226 of 1976.

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(Appeal by Special Leave from the Judgment and Order dt. the 17th  October,  1975  of the Gujarat  High  Court  in  Civil Revision Appln.  No. 679 of 1972). P.   H.  Parekh,  Manju  Sharma  &  C.  B.  Singh  for   the Appellants. V.   N. Ganpule for the respondent. The Judgment of the Court was delivered by UNTWALIA,  J.-This  is a decree-holders’ appeal  by  Special leave.   The  sole respondent is the judgment  debtor.   The appellants filed a suit against the respondent in the  Small Causes  Court  at Ahmedabad in 1964 claiming  a  decree  for eviction  against him on the ground of non-payment  of  rent and bonafide personal necessity.  The grounds made out  were in  accordance  with the relevant provisions of  The  Bombay Rents,  Hotel  and Lodging House Rates  Control  Act,  1947- hereinafter  to be referred to as the Act.   The  respondent filed  a written statement with a view to contest the  suit. Eventually  on account of the default of the  defendant  the suit  was  taken  up for hearing ex-parte  and  an  ex-parte decree was passed on the 16th of March, 1966.  The defendant applied  under  Order IX Rule 13 of the Code of  Civil  Pro- cedure-hereinafter  to  be  referred to  as  the  Code,  for setting aside the decree.  It was set aside.  But ultimately the  suit  was  disposed  of  on  the  1st  March,  1967  on compromise  between the parties.  According to the terms  of the compromise decree, the judgment-debtor was to hand  over possession of the suit premises to the decree holders within a period of three years i.e. by 1st of March, 1970.  But  he did  not  do  so.  Thereupon  the  decree-holders  filed  an execution case to get 389 possession  of the property.  The respondent  contested  the execution on the ground that the decree was a nullity.   The first  Court accepted his plea but on appeal by the  decree- holders  it was held by the Appellate Court that the  decree was not a nullity and was executable.  The respondent  filed a  revision application in the Gujarat High Court which  has been allowed.  The High Court has accepted the  respondent’s plea  that  the  compromise decree is a  nullity  and  hence cannot be executed. It  is  not  necessary to review again  and  again  all  the earlier  judgments of this Court on the point.  It  will  be sufficient  to refer only to two namely, Nagindas Ramdas  v. Dalpatram Ichharam @ Brijram and Ors(1)-a judgment which  is noticed by the High Court also in its order under appeal and the case of Roshan Lal v. Madan Lal(2). It  was pointed out in Nagindas’s case (supra) by one of  us (SarKaria  J)  that the existence of one of  the.  statutory grounds  mentioned in sections 12 and 13 of the Act,  as  in the  case of other similar States Statutes, is a;  sine  qua non  to  the exercise of jurisdiction by the Rent  Court  in order  to enable it to make a decree for eviction.   Parties by  their  consent cannot confer jurisdiction  on  the  Rent Court  to  do something which according to  the  legislative mandate  it  could  not do.  The  Court  while  recording  a compromise  under  Order XXIII, Rule 3 of the  Code  has  to satisfy  itself  that the agreement between the  parties  is lawful; in other words is not contrary to the provisions  of the Act But    it  has been clearly laid down in  Nagindas’s case at page 552               "........  that if at the time of the  passing               of the decree, there was some material  before               the  Court, on the-basis of which,  the  Court               could  be  prima facie satisfied,,  about  the               existence of a statutory ground for  eviction,

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             it  will  be presumed that the  Court  was  so               satisfied and the decree for eviction,  though               apparently   passed   on  the   basis   of   a               compromise, would be valid.  Such material may               take the shape either of evidence recorded  or               produced  in  the case, or, it may  partly  or               wholly  be  in  the shape  of  an  express  or               implied  admission  made  in  the   compromise               agreement, itself,. . . ." In  Roshan  Lal’s case, one of us  (Untwalia  J.)  following Nagindaes  case  reiterated  the same  view.   At  page  882 delivering the judgment of this Court, it has been said               "The Court can pass a decree, on the basis  of               the compromise.  In such a situation the  only               thing to be seen is whether the compromise  is               in  violation of the requirement of  the  law.               In other words, parties cannot be permitted to               have  a tenants eviction merely  by  agreement               without  anything more.  The  compromise  must               indicate  either  on  its.  face  or  in   the               background of other materials in the case that               the tenant expressly or impliedly is  agreeing               to  suffer a decree for eviction  because  the               landlord, in the circumstances, is entitled to               have such a decree under the law." (1)  [1974] 2 S.C.R. 544. (2)  [1976] 1 S.C.R. 878, 390 With  reference  to the requirement of the law  under  Order XXIII  Rule 3 of the Code, it has been observed  further  on the same page :-               If   the  agreement  or  compromise  for   the               eviction of the tenant is found, on the  facts               of a particular case, to be in violation of  a               particular  Rent Restriction or  Control  Act,               the   Court   would  refuse  to   record   the               compromise   as  it  will  not  be  a   lawful               agreement.  If on the other hand, the Court is               satisfied on consideration of the terms of the               compromise  and, if necessary, by  considering               them in the context of the pleadings and other               materials  in the case, that the agreement  is               lawful,  as  in  any  other  suit,  so  in  an               eviction  suit, the Court is bound  to  record               the compromise and pass a decree in accordance               therewith.  Passings a decree for eviction  on               adjudication  of  the requisite  facts  or  on               their admission in a compromise either express               or implied, is not different."               The  High  Court has held the decree to  be  a               nullity on the following grounds :-               (1)   Admittedly,  the  order  passed  by  the               learned   Judge   does   not   disclose    any               satisfaction   recorded  by  him   about   the               existence  of one or more grounds of  eviction               under  the  Act.   Naturally,  therefore,  the               decree  does  not disclose  that  the  learned               Judge,  who  passed the eviction  decree,  was               satisfied  about the existence of any  of  the               grounds for eviction.               (2)   In the compromise pursis also, there  is               no  admission  on the part of  the  defendant,               express  or  implied,  under  section  12   or               section 13 of the Act." In arriving at the said conclusions the High Court has  left

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out  of consideration the affidavit filed on behalf  of  the appellants  at the time, the suit was taken up  for  hearing ex-parte  and the ex-parte decree following  thereupon.   We also do not propose to refer to those materials to arrive at our conclusions, which are different from those of the  High Court.  But even apart from those materials, there is  abun- dant intrinsic material in the compromise itself to indicate that  the decree passed upon its basis was not in  violation of the Act but was, in accordance with it. In  Vora Abbasbhai Alimahmomed v. Haji Gulamnabi Haji  Safi- bhai(1)  Shah J, as he then was, delivering the judgment  of this  Court pointed out that when the conditions  of  clause (a)  of  sub-section  (3)  of section  12  of  the  Act  are fulfilled  the Court is bound to pass a decree in  ejectment against  the tenant.  But in relation to clause (b)  it  has been said at page 166 :-               "The  clause  deals  with  cases  not  falling               within  cl.  (3) (a) i.e. cases (i)  in  which               rent is not payable by the month (ii) in which               there is a dispute regarding the standard rent               and (1)  [1964] 5 S.C.R. 157. 391               permitted  increases, (iii) in which  rent  is               not  due  for six months or  more.   In  these               cases  the,  tenant may  claim  protection  by               paying or tendering in Court on the first  day               of the hearing of the suit or such other  date               as  the Court may fix, the standard  rent  and               permitted  increases and continuing to pay  or               tender  in  Court  regularly  such  rent   and               permitted  increases till the suit is  finally               decided  and also by paying costs of the  suit               as directed by the Court." It  clause (b) is attracted as being any other case  of  the type  (ii) i.e. "in which there is a dispute  regarding  the standard rent and permitted increases", then in such a case, "the tenant would not be in a position to pay or tender  the standard  rent, on the first date of hearing, and fixing  of another  date  by the Court for payment or tender  would  be ineffectual,  until the standard rent is fixed."  Hence  the Court,  on  the application of the tenant, has  to  fix  the standard rent first.  But if there is no dispute or no  bona fide  dispute, or the dispute raised is a mere  pretence  of it,  a decree can follow under clause (b) of subsection  (3) of section 12 of the Act in a suit in which rent is not  due for six months or more but is due even for a lesser  period. The tenant will get the protection against eviction in  such a case only if he pays or tenders in Court on the first date of  the hearing of the suit or such other date as the  Court may fix the rent due (leaving aside the question of costs). In the instant case the High Court was not right that on the face  of the compromise pursis or the order passed  thereon, there  was  no material to show that the tenant  had  either expressly  or  impliedly suffered a decree for  eviction  as being liable to be evicted in accordance with section 12 (3) (b) of the Act.  While recording the compromise under  Order XXIII Rule 3 of the Code, it is not necessary for the  Court to  say in express terms in the order that it was  satisfied that  the compromise was a lawful one.  It will be  presumed to  have, done so, unless the contrary is shown.   But  that apart, on examination of the plaint which certainly could be looked  into and which must have been in the records of  the Court  at the time of the passing of the compromise  decree, it would be found that the landlords had claimed arrears  of

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rent  for two months @ Rs. 17/- per month and  mesne  profit also  for  one month upto the date of the suit at  the  same rate.   They  had also claimed light charges @ Rs.  2/-  per month.   In, the compromise petition, paragraph 2, the  same amount  of  rent,  mesne profit  and  electric  charges  are admitted by the tenants to be payable to the landlords There is  nothing to indicate that any genuine dispute was  raised by the tenant in regard to be standard rent or the  electric charges Nor is there anything to show that he had ever filed a  petition  under  section  11 of  the  Act  or  any  other provision  of law for fixation of standard rent.   In  other words, there is nothing to show that the tenant could  claim protection  from eviction in accordance with clause  (b)  of sub-section (3) of section 12 of the Act on the ground  that he  was not in a position to pay or tender the rent  due  on the  first date of the hearing of the suit, which must  have been  fixed before the passing of the ex-parte decree.   Nor was  he able to show that the Court at his request bad  ever fixed any other date for 392 payment of the said amount In paragraph 3 of the  compromise petition also it is admitted that the standard rent would be Rs  17/-  per  month plus Rs 2/- electric  charges  and  the defendant would pay the mesne profits at the aforesaid rates from  1-3-1967. It is, therefore manifest that there was  no such  dispute in this case in regard to standard rent  which could give any protection to the tenant against his eviction under  section 12 (3) (b) of the Act The facts clearly  show that he had incurred the liability to be evicted’ under  the said provisions, of law and the compromise decree was passed on  the  tenant’s impliedly admitting such  liability  If  a decree for possession Would have been passed in inviting the tenant  would not have got three years’ time to  vacate  the premises.   He,  therefore,  agreed to suffer  a  decree  by consent  and  gained three years’ time under  it.   But  the unavoidable  uncertainties  of litigation and the  delay  in disposal  of cases at all stages have enabled him to gain  a period of about 1 1 years. more by now.  In our judgment the decree  under execution is not a nullity and has got  to  be executed by the Execution Court without any further loss  of time, as quickly as possible. In the result, we allow this appeal with costs and set aside the judgment and order of the High Court. P.H.P.    Appeal allowed. 393