Paragraph numbers below are the court’s original numbering, recovered from the source text.
42. Therefore, the question would finally arise that in a Second Appeal, filed by the tenant, against whom an Order/Decree of Eviction is passed, on a ground, other than under Section 12(1)(a), even after the tenant complies with the requirement of Section 13 and deposits the rent, as was being paid, whether the Appellate Court, when approached by the appellants-tenants, seeking a stay of the execution of the Decree under Order XLI Rule 5 of the Code of Civil Procedure, 1908 (hereinafter referred to as, ‘the Code’, for short), they could be asked to deposit an amount representing a reasonable market value of the rent. Undoubtedly, in the Act, the definition of the word “tenant”, does not include a person against whom an Order or Decree of Eviction has been passed. In the said sense, the Act can be treated as similar to the Delhi Rent Control Act. In other words, with the Order/decree of Eviction being passed, the person who was tenant till that point of time, ceases to be the tenant. He would become an unauthorised occupant in the words of this Court in Atma Ram Properties (supra). The principle in Atma Ram Properties (supra), therefore, would apply unless Section 13 poses an obstacle in the path of the Appellate Court directing the payment of the mesne profits by the appellants as a condition of stay of execution.
43. In this case, undoubtedly, appellants have invoked Order XLI Rule 5 of the CPC. It is in the said Application that the High Court has granted a stay, subject to the condition of payment of amount in a sum of Rs.18,000/- per month. The landlady filed an application seeking deposit of the rent which led to the stay being conditioned. This amount has been arrived at on the basis of the Report submitted by the Authority. Undoubtedly, the tenancy relates back to the year 1975. The rent canvassed by the appellants is Rs.872/- per month and Rs. 622/- per month.
44. In Section 13 of the Act the law giver has given a section heading ‘when a tenant can get benefit of protection against eviction’. It is thereafter that the provisions are enacted. Sub section 5 of Section 13 HEERA TRADERS v. KAMLA JAIN [K. M. JOSEPH, J.] relates only to a suit in which the ground of eviction is default of payment of rent. As far as Section 13 (6) is concerned it deals with a situation where the tenant fails to deposit or pay the amount under Section 13 of the Act. Prior to Section 13 being substituted in the year 1983 it contemplated that the court may strike out the defence against eviction and proceed with the hearing of the suit. It was this provision which was interpreted in Shyamcharan Sharma (supra) to mean that the court still has a discretion and is empowered to grant extension of time to pay rent under Section 13. By virtue of the substitution in the year 1983 in Section 13 (6) in view of the addition of the words ‘appeal or proceeding as the case maybe’, on the failure of the tenant to deposit or pay the amount as required by Section 13 the court is empowered to strike out the defence against eviction is made applicable to an appeal or proceeding by the tenant. An appeal and proceeding can be disposed off which essentially means that an Order of Eviction would ordinarily follow as the appeal or other proceeding by the tenant is against an Order of Eviction which is already passed.
45. Now, as far as a suit for eviction based on ground other than Section 12(1)(a), viz., arrears of rent. Section 13 expressly does not provide as to what is to happen if the tenant complies with requirement of Section 13 as distinct from the failure of the tenant to comply with Section 13. In this case we are concerned with the former namely what would be the position if the tenant faithfully complies with the mandate of Section 13 and has deposited/ paid the amount. There is no express intention expressed by the law giver in this regard in Section 13.
46. In this regard it is again relevant to look at what the law giver is provided in Chapter IIIA. We say this for the reason that Section 13 has been applicable mutatis mutandis by virtue of Section 23H as we have already noticed. However, Section 23F provides as follows: – “Section 23F. Duration of stay. – The stay of the operation of the order of eviction passed by a Rent Controlling Authority or by the High Court shall not ensure for a total period of more than six months.”
47. Therefore, this provision indicates that despite payment being made by the tenant of the amount in terms of Section 13 in a revision filed within the meaning of Section 23H an order of stay of eviction may still be necessary. In other words, ipso facto, the mere payment of the amount in terms of Section 13 would not shelter the tenant who has filed a revision referred to in Section 23H from being proceeded against in execution of the decree. The law giver has contemplated an order of stay being passed in Section 23F with the restraints regarding the duration of the stay order which has been declared therein.
48. Thus, the payment of the amount mentioned in Section 13 in a Chapter III proceeding by itself may not result in a stay of the decree or Order of Eviction.
49. The further question would however arise that in an appeal filed by the tenant against the decree or Order of Eviction whether on a proper construction of Section 13 of the Act, whether the Appellate Court can impose any condition other than that of deposit of the amount which no doubt is the rent which was being paid. The other way to look at it which is what the landlady wants us to do is to import in the principle enunciated in Atma Ram Properties (supra).
50. We have already noticed the decision rendered by a bench of 5 learned Judges of the Madhya Pradesh High Court decided on 17.02.1977 in S.S. Harischandra Jain and others (supra),at a point of time when Section 13 was in its erstwhile form. The Court held,inter alia, as follows: “(ix) In tenant’s appeal, application of Section 13 is unnecessary because the landlord can execute the decree and recover rent, and if, stay is sought, condition of payment of rent can be imposed. In case of landlord’s appeal against dismissal under Section 13 (5) the tenant will automatically deposit, and go on depositing, rent because of the deterrent in Section 12(3). In landlord’s appeal from dismissal on other ground, there is no special equity in his favour. In case of non-payment of rent his ordinary remedy of a suit for recovery of rent is available to him. (xi) Section 13 is not a machinery for realisation of rent as an alternative to a, suit for recovery of rent. The object of Section 13 is to put a check on the unscrupulous tenant who would protract litigation without payment of rent. That purpose is served in the suit. But the enquiry is reversed when the suit is dismissed.” (Emphasis supplied)
51. This view, as again noted,has been approved by the still larger bench of the High Court reported in AIR 1978 MP 143. Apparently, HEERA TRADERS v. KAMLA JAIN [K. M. JOSEPH, J.] these judgements led to the substitution of Section 13 in the year 1983 by way of the legislative intervention and in an appeal or other proceeding by the tenant against the decree or Order of Eviction the duty to pay rent came to be imported. Bearing in mind this legislative history which can be said to be in recognition of exposition of law by the High Court, could it be said that the legislature contemplated the Appellate Court granting stay of the decree of eviction subject only to the condition that the amount which represented the rent which was being paid is paid as a condition.
52. As we have seen, the actual protection which is granted under Section 13 of the Act, is what is provided in Section 13(6), in the cases at hand.
53. Does Section 13 have the effect of operating as a stay of the Decree for Eviction in its own right? The principal contention of the appellants is that the principle in Atma Ram (supra) that upon an Order of Eviction being passed, the erstwhile tenant ceases to be a tenant and his possession becomes wrongful and, therefore, he can be called upon to deposit mesne profit, would not apply, having regard to the contents of Section 13 of the Act. This is for the reason that contrary to the definition of the word ‘tenant’ in Section 2(i), Section 13 reintroduces the concept of ‘tenant’, even after the Order of Eviction is passed and when the erstwhile tenant seeks to maintain an appeal or other proceeding against the Decree or Order of Eviction. He is called upon, furthermore, to deposit the agreed rent. Once he is called upon to deposit the agreed rent and he is treated as a tenant by the Law Giver, by virtue of the unique provisions contained in Section 13(1) of the Act, the principle in Atma Ram (supra) would, therefore, not apply. In other words, despite definition of ‘tenant’ in Section 2(i) of the Act, excluding a person against whom an Order of Eviction has been passed, he does not stand in the shoes of a person in wrongful possession, it is contended.
54. In fact, in Section 13, as far as reference to rent is concerned, the words used are “an amount calculated at the rate of rent, at which it was paid”. The further expressions used are”a sum equivalent to rent at that rate”. These expressions are used to denote the amount payable by the person described as tenant, both before the Order of Eviction is passed and after the Order of Eviction, during the pendency of appeal or proceeding, as the case may be. We are making this observation for the reason that if the words “an amount calculated at the rate, at which, it was paid or a sum equivalent to the rent”, is understood as describing the amount, which is not the rent as such, but the amount, which, the person was obliged to pay as a tenant, after the Order of Eviction is passed, then, it could be said that, what is contemplated is that, the amount directed to be paid, is treated as not the rent as such, but the amount equivalent to the amount or an amount calculated at the rate of rent. Such an amount, being payable, may be reconcilable with the Order of Eviction, putting an end to the tenancy and erstwhile tenant becoming a person in illegal possession. But herein, we may notice that the same expression is used even for describing the amount payable during the pendency of proceeding under Section 12. In other words, these words are applicable to describe the amount payable at all points of time, including the pendency of the suit, appeal or other proceedings. To make it even more clear, both, at the stage when landlord-tenant relationship exists and, at the stage, when following an Order of Eviction, going by the definition of ‘tenant’ in Section 2 of the Act, the erstwhile tenant would cease to be a tenant, the amount payable in Section 13 is described in the similar manner. In fact, there is no case as such that the amount which is paid by the tenant in Section 13 is anything but the agreed rent. However, for reasons which follow, it will not advance the case of the appellants.
55. As far as the aspect about the former tenant, even after the Order of Eviction being referred to as a tenant, even when he maintains an appeal against a Decree/Order of Eviction is concerned, we would think that it can be a legislative device to aptly describe the person in question devised by the Legislature. In this regard, the more important question is, whether after the Order of Eviction is passed, the erstwhile tenant would remain a tenant in law. The tenant begins his innings ordinarily as a contractual tenant. In the case of a contractual tenant, upon the expiry of the lease, he is under the Transfer of Property Act and, in accordance with the contract, duty-bound to vacate the premises and deliver possession to the landlord. Failure on his part to do so, would expose him to an action for mesne profits, on the basis that his continuance after the period and contrary to the contract, would be wrongful. In the case of a statutory tenant, which, undoubtedly, the tenant was, the mere expiry of the contractual lease, does not result in the tenancy coming to an end under the laws relating to the statutory tenancy. It is with the Order of Eviction, which is passed, that the erstwhile tenant ceases to be the tenant. After the Order of Eviction is passed, the law deprives the HEERA TRADERS v. KAMLA JAIN [K. M. JOSEPH, J.] erstwhile tenant of his status of tenancy. The definition of ‘tenant’, accordingly, in Section 2(i) of the Act, is a legislative recognition of this position. Now, the Act enables the filing of appeal or other proceeding by the erstwhile tenant. The law prescribes the period of limitation. Does it mean that the possession of the erstwhile tenant or rather his occupation of the premises, after the Order of Eviction, is not wrongful? What will be the position, if he prefers an appeal, after a long delay and delay is condoned? Can it be said that during the period delay, at any rate, that the erstwhile tenant sheds his character as illegal occupant? We would think that with the passing of Decree or Order of Eviction, the erstwhile tenant, no longer, remains a tenant. He continues to occupy the premises, which, in law, is wrongful. Under the law, generally, continued occupation of a tenant, after the expiry of the lease, may not make him a trespasser, as his original entry was lawful. For the purpose of mesne profits, however, whether it be under the general law or under the Rent Statute, once, the tenancy itself comes to an end, which in the case of statutory tenancy occurs with the passing of the Order of Eviction and, in the case of the contractual tenancy, upon the expiry of the lease,the possession of the erstwhile tenant, indeed, becomes wrongful. The fact that the law permits the filing of an appeal or other proceeding, will not detract from the aforesaid position.
56. This position is self-evident from the decision in Atma Ram (supra). The Judgment in Atma Ram (supra) makes it clear that the erstwhile statutory tenant would become an unauthorised occupant upon the passing of the Order by the original Forum. This Court has further held that fact that the Order of Eviction has been challenged in an appeal or revision and it is confirmed at a later point, will not enable the erstwhile tenant to contend that he would remain a tenant even after the Decree/ Order of Eviction.
57. Once this position at law is kept in mind, the impact of Section 13 of the Act, will become clear. We have already noticed that the actual protection, which is provided in Section 13 of the Act, as far as the cases we are concerned with, is contained in Section 13(6) of the Act. Upon the tenant, as described in Section 13, paying the amounts as provided therein, the tenant is allowed to, inter alia, prosecute the appeal or other proceeding. The failure to comply with Section 13, will result in the consequences, which are provided therein. Since, we are concerned here with the consequences of tenant acting in conformity of Section 13 of the Act, apart from noticing, what we have already indicated, we would examine, whether it has the effect, which is canvassed for by the appellants.
58. We are of the view that even though Section 13 does refer to the erstwhile tenant as a tenant and it obliges him to deposit throughout the proceedings, the amounts, which can be treated as the rent being paid, which would be contractual rent or even the rent fixed as the standard rent, this does not, by itself, alter the effect of the Decree/ Order of Eviction passed by the Court, by which, he stood deprived of the status of a tenant. The filing of an appeal or other proceeding by the tenant, does not make the Decree inexecutable. The preferring of an appeal or other proceeding, would not bring about a stay of the proceedings based on the Decree or Order of Eviction. The payment of the amounts under Section 13(1) or Section 13(2) of the Act, does not, by itself, bring about the stay of the Decree or Order of Eviction. The net result is, the principle in law and, as recognised in Section 2(i) of the Act, and, as interpreted in Atma Ram (supra), that with the passing of the Order of Eviction by the Court, the possession of erstwhile tenant, becoming wrongful, will apply. By making the payments, contemplated in Section 13(1) or Section 13(2) of the Act, the erstwhile tenant, who stood deprived of the status of a tenant, does not regain the said status by mere reason of the fact that in Section 13 of the Act, he is referred to as the tenant. The position of the erstwhile tenant under the Act, going by the definition in Section 2(i) of the Act, will continue to hold the field, even after an appeal or other proceeding is maintained by him. Therefore, Section 13 of the Act, in our view, despite the unique provision contained therein, does not affect the position at law, which stands declared in Atma Ram (supra). Undoubtedly, in keeping with the view expressed by the larger Bench decisions of the High Court, which we have referred to, the Legislature wanted to ensure that even during the appeal filed by the tenant, inter alia, he would continue to pay the agreed rent.
59. The erstwhile tenant, such as the appellants in these cases, despite making payment, in accordance with Section 13 of the Act, would not be protected from being evicted in terms of the Decree/Order of Eviction during the pendency of the appeal or proceeding. It is open to the appellant, inter alia, in challenging the Decree/Order of Eviction to seek stay of the Decree/Order of Eviction. It is then that the Appellate Court can exercise its powers under Order XLI Rule 5 of the CPC. HEERA TRADERS v. KAMLA JAIN [K. M. JOSEPH, J.]
60. We have found reinforcement in Section 23F of the Act falling in Chapter IIIA, which also contemplates Orders of Stay being passed, even though Section 13 has been made applicable by virtue of Section 23H. As regards the power of the Appellate Court, to grant a stay, it is clear that it is open to the Appellate Court, to impose such condition, as it thinks fit. It can issue directions, as held by this Court in Supermax International (supra). Once we proceed on the basis that with the Decree of Eviction being passed, the erstwhile tenant becomes an unauthorised occupant and he makes himself liable to pay mesne profits for his continued occupation, such an erstwhile tenant can, indeed, be called upon to pay mesne profits. Undoubtedly, there is power with the Appellate Court, in this regard.
61. We have, no doubt, noticed the view taken by the larger Bench of the High Court (which, in fact, paved the way for the substitution of Section 13 in the year 1983) that the Court, after finding that Section 13, with which it was concerned, did not contemplate any duty on the part of the tenant to deposit the agreed rent, in an appeal filed by him, did observe that in such a scenario, it will be open to the landlord to execute the Decree and if the tenant files an application under Order XLI Rule 5 of the CPC, the tenant can be asked to deposit the rent. No doubt, the legislative intervention in 1983 through substitution of Section 13, may have been inspired by the judicial exposition and, therefore, one of the principles of interpretation being that the Legislature must be treated as having in mind the law as interpreted by the Court to be implemented,thus, it could be urged that when an application is filed under Order XLI Rule 5, even after the substitution of Section 13, when the tenant is called upon to deposit the agreed rent, then, even in the matter of imposing condition under Order XLI Rule 5, the tenant cannot be worse off than when Section 13 was in its earlier avatar. In other words, with the deposit of the agreed rent, there would be no occasion to deposit any further amount, even under Order XLI Rule 5. We must, however, bear in mind the fact that the law, as has been declared in Atma Ram (supra), and as has been followed in Supermax International (supra), in the manner already referred to. That is, with the Decree of Eviction being passed, the erstwhile statutory tenant becomes an unauthorised occupant. The fact that the law permits the defendant to file an appeal or to take other proceedings, will not clothe him with rights as a tenant. The fact that the finality of the Decree of Eviction is attained at a later stage, will not be sufficient to extricate him from his position as an unauthorised occupant in the interregnum. This has the inevitable consequence that during such interregnum, the erstwhile tenant, being in the position of an unauthorised occupant, he becomes liable to pay mesne profits. Once this position is clear, then, the necessary corollary is, even after the substitution of Section 13, it would be open to the Appellate Court to impose the condition that appellant seeking to contest the Decree of Eviction, shall deposit a reasonable sum, which is not to be limited to the agreed rent. This position is also better understood in the light of the plight of the landlords, who are forced to wait for long, the realisation of the fruits of the Decree for Eviction, which they have obtained. In fact, this aspect, as to the entitlement of the landlord for an amount in excess of the agreed rent, in the light of the Decree of Eviction, as such, was not considered by the larger Bench of the High Court. At any rate, in the light of the Judgments of this Court, there cannot be any dispute about the principle that upon a Decree of Eviction being passed, the erstwhile tenant becomes an unauthorised occupant and remains one thereafter during the entire proceedings. The fact that there is power to fix standard rent cannot affect this position. In fact, the respondent would point out that after the eviction is ordered even the power to fix standard rent ceases as the tenancy comes to an end.
62. It is undoubtedly true that the existence of power under Order XLI Rule 5 of the CPC, is not to be confused with the exercise of its power by an Appellate Court. That there is power with the Appellate Court, may not enable it to Order any unreasonable amount or reach a windfall to the landlord. The power is to be exercised on a careful consideration of the facts of each case. It will include the quantum of agreed rent, which the tenant is paying under Section 13 of the Act. It will consider whether the said sum is the result of any fixation of standard rent. If so, what is the point of time, at which, the agreed rent was arrived at, the nature of the premises and all other relevant facts. It may include a case where the Appellate Court, on a perusal of the impugned Judgment, is convinced, prima facie, no doubt, that the Decree for Eviction is palpably insupportable, in which case, it may grant a stay, without calling upon the tenant to pay any sum in excess of amount fixed in Section 13 of the Act.
63. We are unable to accept the appellants case that Section 13 of the Act, being a special law, the power under Order XLI Rule 5, cannot be exercised to direct deposit or payment of mesne profits. HEERA TRADERS v. KAMLA JAIN [K. M. JOSEPH, J.] Compliance with Section 13 by the appellants, does not, as found by us, amount to a stay of the Decree for Eviction. The power of the Appellate Court to impose conditions for staying the Decree, cannot be confined by the dictate in Section 13 of the Act, to the appellants/tenants, to deposit the agreed rent, particularly, having regard to the time consumed in litigation and, more importantly, the impact of the Decree of Eviction, depriving the appellant of his status as a tenant.
64. The upshot of the above discussion is that we reject the contention of the appellants that Section 13 of the Act will detract from the principle in Atma Ram (supra) and Supermax International (supra)being available to the cases under the Act.
65. Coming to the facts, the rent being paid for 100 square feet of non-residential accommodation by one of the appellants is Rs.622/-, fixed in 1975. In the other case, the rent canvassed by the appellant, as being the agreed rent, was a monthly rent of Rs.847/-, fixed in the year 1975. The premises in question is also non-residential and it consists of 150 square feet. There is no reference to the rent being fixed in proceedings for fixing the standard rent. The Suit was filed in the year 2009. The Decree for Eviction was passed in the year 2013. The First Appellate Court dismissed the appeal filed by the appellants on 25.03.2014. The Second Appeal was filed in the year 2014. The impugned Orders came to be passed on 17.03.2020 and 25.08.2021 at the stage of second appeal when two courts have found against the appellants. The amount has been fixed at Rs.18,000/- per month. The amount has been fixed on the basis of the Report submitted by the Rent Controlling Authority, who was asked to report regarding the market rate of the accommodation in question. The complaint of the appellant is that the Rent Controlling Authority has tendered its Report and, while doing so, adequate opportunity was not provided and the materials placed were not considered and that the amount is unreasonable. It is said to be based only on the Panchnama prepared by the Revenue Officer. The High Court has found that the premises are located in a famous commercial place and the rent of Rs.847/ – per month was fixed in the year 1975.
66. We do not think that the appellants should be permitted to challenge the quantum, once we have answered the legal issues flowing from Section 13, against the appellants. It would appear from the written submission that the appellants have deposited certain sums in execution of the orders. The appellants will be entitled to adjust the said amount in complying with the impugned orders. The amount of Rs.18000/- will subsume the amount paid/payable under Section 13 of the Act.
67. We may, however, notice the following views expressed by this Court in Supermax International (supra): “79. Before concluding the decision one more question needs to be addressed: what would be the position if the tenant’s appeal/ revision is allowed and the eviction decree is set aside? In that event, naturally, the status quo ante would be restored and the tenant would be entitled to get back all the amounts that he was made to pay in excess of the contractual rent. That being the position, the amount fixed by the court over and above the contractual monthly rent, ordinarily, should not be directed to be paid to the landlord during the pendency of the appeal/revision. The deposited amount, along with the accrued interest, should only be paid after the final disposal to either side depending upon the result of the case. 80. In case for some reason the court finds it just and expedient that the amount fixed by it should go to the landlord even while the matter is pending, it must be careful to direct payment to the landlord on terms so that in case the final decision goes in favour of the tenant the payment should be made to him without any undue delay or complications.” 68. Thus, in the facts of this case, we would think that the direction to pay the entire amount, may require modification. Equally, we are of the view that some time must be granted to deposit the amount. 69. Accordingly, in modification of the impugned Orders, we order as follows: a. Appellants are granted five weeks to deposit the entire amount in terms of the impugned orders after adjusting the amounts already deposited/paid on the basis of the orders of the execution court. The amounts will also subsume the amounts paid/payable under Section 13 of the Act. b. We further order that the respondent in the appeals shall be permitted to withdraw the rent at the rate of Rs.10,000/- per month from the amount which is deposited; HEERA TRADERS v. KAMLA JAIN [K. M. JOSEPH, J.] c. The respondent shall be permitted to withdraw at the rate of Rs.10,000/- per month from the amount to be deposited by the appellants, on such terms to be fixed by the High Court; 70. Save as aforesaid, we affirm the impugned Orders. The appeals are partly allowed as above. There will be no order as to costs. Divya Pandey Appeals partly allowed. (Assisted by : Deepak Panwar, LCRA)