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CASE NO.: Appeal (civil)  4070 of 2002

PETITIONER: Vishwant Kumar

RESPONDENT: Madan Lal Sharma & Anr.

DATE OF JUDGMENT: 18/03/2004

BENCH: V.N. KHARE, S.B. SINHA & S.H. KAPADIA

JUDGMENT: J U D G M E N T

KAPADIA, J.

       The Delhi Rent Control Act, 1958 (hereinafter referred to  for the sake of brevity as "the Rent Act") was amended by Act  No.57 of 1988.  The said Amending Act came into effect from  1.12.1988.  Section 3(c) of the Amending Act provided that the  provisions of the Rent Act will not apply to premises whose  monthly rent exceeded Rs.3500/-.  The question which arises  for determination in this civil appeal is \027 whether section 3(c)  as amended was applicable to standard rent application, which  was pending before the Court on 1.12.1988 when the Amending  Act came into force?

       On 7th May, 1976, an agreement was entered into  between the appellant \026 tenant and the respondent \026 landlord,  under which the appellant took on lease a shop on a monthly  rent of Rs.5000/- per month.  On 11.4.1978, the appellant filed  a petition for fixation of standard rent under section 9 of the  Rent Act.  The contention of the appellant was that the standard  rent should be fixed at Rs.1350/- per month and that the rent  agreed upon at Rs.5000/- per month was excessive.  On  23.3.1987, the respondent filed his written statement.  The case  was pending on 1.12.1988 when section 3(c) was inserted by  Amending Act 57 of 1988.  On 27.5.2000, when the case was  pending, the respondent moved an application under section  151 CPC before the Rent Controller seeking dismissal of  standard rent application made by the tenant, in view of  amended section 3(c).  By order dated 16.12.2000, the Rent  Controller allowed the landlord’s application and consequently  dismissed the standard rent application made by the tenant as  incompetent and not maintainable.  Being aggrieved, the  appellant herein preferred appeal No.9 of 2001 before the  Tribunal which was dismissed.  Aggrieved, the appellant herein  preferred second appeal bearing S.A.O. No.4 of 2001 in the  High Court which was also dismissed by the impugned  judgment dated 4.5.2001.  Hence, this Civil Appeal.

       Mr. V.R. Reddy, learned senior counsel for the appellant  submitted that section 4 conferred a substantive right on the  tenant not to pay rent in excess of the standard rent except to  the extent of lawful increase of the standard rent in accordance  with the provisions of the Act.  On 11.4.1978, pursuant to the  right conferred under the Rent Act, the appellant filed a  standard rent application.  It was urged that on 11.4.1978 the  tenant had a right to apply for fixation of standard rent without

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limit.  It was urged that when the lis commenced on 11.4.1978,  all the rights of the appellant got crystallized.  That the Rent  Act was a beneficent legislation and the Amendment Act while  inserting section 3(c) did not intend to obliterate the rights  vested in the appellant on the date of his petition for fixation of  standard rent.  It was vehemently urged that the appellant can  not be made to suffer because of court’s delay.  In this  connection, learned counsel for the appellant relied on the  doctrine of "Actus curiae neminem gravabit".  It was further  contended that the right not to pay rent in excess of the standard  rent did not depend on its fixation by the Rent Controller, that it  was on incident of tenure and consequently it was not in the  nature of protective right.  In this connection, it was submitted  that limited repeal in section 3(c) did not affect any right,  privilege, obligation or liability acquired under any enactment  and, therefore, such a right was not intended to be taken away  by section 3(c) of the Rent Act.  In support of his arguments,  learned counsel relied upon several judgments of this Court.   

       We do not find merit in the above arguments.  There is a  difference between a mere right and what is right acquired or  accrued.  We have to examine the question herein with  reference to sections 4, 6 and 9 of the Act. It is correct that  under section 4 of the Rent Act, the tenant is not bound to pay  rent in excess of the standard rent, whereas under section 9 he  has a right to get the standard rent fixed. Such a right is the  right to take advantage of an enactment and it is not an accrued  right.  In the case of D.C. Bhatia v. Union of India reported in  [(1995) 1 SCC 104], it has been held that right of a statutory  tenant to pay standard rent is a right to be governed by the Act  and if the legislature repeals the Act or a part of it, the statutory  tenant can do nothing about it.  It is a mere right and not a  vested right.  To the same effect is the judgment of this Court in  the case of Thyssen Stahlunion GMBH v. Steel Authority of  India Ltd. reported in [(1999) 9 SCC 334], in which it is held  that right to be governed by the Act is not a right of an enduring  nature.  What is unaffected by repeal is a right acquired or  accrued under the Act.  That till the decree is passed, there is no  accrued right.  The mere right existing on date of repeal to take  advantage of the repealed provisions is not a right accrued  within section 6(c) of the General Clauses Act.  Further, there is  a vast difference between rights of a tenant under the Rent Act  and the rights of the landlord.  The right of a statutory tenant to  pay rent not exceeding standard rent or the right to get standard  rent fixed are protective rights and not vested rights.  On the  other hand, the landlord has rights recognized under the law of  Contract and Transfer of Property Act which are vested rights  and which are suspended by the provisions of the Rent Act but  the day the Rent Act is withdrawn, the suspended rights of the  landlord revive. {See: Parripati Chandrasekhar Rao & Sons v.  Alapati Jalaiah [(1995) 3 SCC 709]}. Lastly, as held by this  Court in the case of D.C. Bhatia (supra), the object of the  amending Act, 1988 was to rationalize the Rent Act whereby  the protection given to the richer tenant is withdrawn.  The  object of the Amendment Act, 1988 is to strike a balance  between the claims of the landlord who get meager rent,  particularly in times of inflation and the tenants who equally  need protection from arbitrary eviction.  In the circumstances,  we hold that in view of section 3(c) as amended, the application  for fixation of standard rent filed by the tenant on 11.4.1978 has  been correctly dismissed as infructuous.  We have gone through  the decisions cited by the learned counsel for the appellant.  The  case of Ambalal Sarabhai Enterprises Ltd. v. Amrit Lal and  Co. and Anr. [(2001) 8 SCC 397] was a case involving rights  of a landlord under section 14(1)(b) of the said Act.  It was held

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that a ground of eviction based on illegal sub-letting under  section 14(1)(b) of the Rent Act would not constitute a vested  right of landlord, but it would be a right within the meaning of  section 6(c) of the General Clauses Act if proceeding for  eviction is pending, however, the tenant has no vested right  under the Rent Act as the tenant has only a protective right.  In  the present case, we are concerned with the nature of rights of  the tenant under the Rent Act.  The ratio of this decision  supports our above view.

       The judgment of this Court in the case of Atma Ram  Mittal v. Ishwar Singh Punia reported in [(1988) 4 SCC 284]  has no application to the present case.  In that case, the landlord  had instituted the suit, in civil court in Haryana, for possession  of the shop rented out to the tenant in 1978, on the ground of  arrears of rent.  It was filed in the civil court as the premises in  question were exempted for 10-years from the Rent Act.  On  behalf of the tenant, it was urged that in view of section 1(3) of  the Rent Act the suit was not maintainable and under section 20  of the Rent Act the jurisdiction of the civil court was barred.   However, during the pendency of the litigation, the period of  exemption/immunity expired.  The question was whether the  premises which was not 10-years old on the date of the suit and  which was exempted from the operation of the Rent Act would  be governed by it on expiry of ten years during the pendency of  the litigation.  The tenant succeeded before the High Court on  the ground that the suit was filed during the immunity period  and it was barred under section 20 of the Rent Act.  Allowing  the appeal, this Court held that if the immunity from the Rent  Act depended upon the ultimate disposal of the case within ten  years, which is in reality an impossibility, the immunity would  become illusory.  In coming to that conclusion, this Court  invoked the doctrine of actus curiae neminem gravabit  \026 an act  of the Court shall prejudice no man.  In that case, the rights of  the landlord under the Rent Act were suspended for 10-years  but on expiry they stood revived.  The matter was concerning  the rights of the landlord.  In the circumstances, the judgment of  this Court in the Atma Ram Mittal (supra) has no application to  the facts of the present case.   

       Similarly, the judgment of this Court in M/s Raval & Co.  v. K. G. Ramachandran [(1974) 1 SCC 424] has no application  to the facts of the present case.  In the said case, one of the  arguments advanced on behalf of the tenant was that the  fixation of fair rent under the Tamil Nadu Rent Control Act  could only be downwards from the contracted rent and the  contract rent was not to be increased.  It was held by this Court,  by a majority decision, that the Tamil Nadu Rent Control Act  was a complete Code in respect of contractual tenancies as well  as statutory tenancies.  That the scheme of the Act was different  from the Bombay Rent Act.  On close reading of the Tamil  Nadu Rent Control Act, this Court found that the fair rent was  required to be fixed for the building which was something like  an incident of tenure regarding the building.  This conclusion  was based on the scheme of the Tamil Nadu Rent Control Act.   Hence, the judgment of this Court in the case of M/s Raval &  Co. (supra) has no application to the facts of this case.

       In any event of the matter where there is an agreed rent  between landlord and tenant either prior or earlier to the  Amending Act providing that the provisions of Rent Act will  not apply to the premises whose monthly rent exceeded  Rs.3500/-, the tenant is estopped from taking a plea that it is not  the standard rent.

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       For the aforestated reasons, there is no merit in this civil  appeal and accordingly the same is dismissed with no order as  to costs.