1995 JTR(SC) 961
1996 1 AllCJ 229 ; 1997 3 BomCR(SC) 1 ; 1995 3 CCC(SC) 425 ; 1995 3 CurCC(SC) 425 ; 1996 DNJ 20 ; 1996 1 GLH 455 ; 1996 1 ICC 293 ; 1995 7 JT 400 ; 1996 1 MhLJ(SC) 507 ; 1995 2 RCJ 451 ; 1995 2 RCR(Rent) 638 ; 1995 5 Scale 481 ; 1995 6 SCC 576 ; 1995 KHC 1347 ; 1995 2 KLT(Online) 1033
SUPREME COURT OF INDIA
BEFORE KULDIP SINGH AND S. SAGHIR AHMAD, JJ.
LAXMIKANT REVCHAND BHOJWANI AND ANOTHER
Versus
PRATAPSING MOHANSINGH PARDESHI DECEASED THROUGH HIS HEIRS AND LEGAL REPRESENTATIVES.
Civil Appeal No. 8379 of 1995 {From the Judgment and Order dated 23/24-11-1993 of the Bombay High Court in W.P. No. 3318 of 1989}
Decided on 18-9-1995
Advocates appeared:
Soli J. Sorabjee, Senior Advocate (A.M. Khanwilkar, Advocate, with him) for the Appellants; S.B. Wad, Senior Advocate (Ms J.S. Wad, Advocate, with him) for the Respondents.
Act
Referred
:BOMBAY RENTS, HOTEL AND LODGING HOUSE RATES CONTROL ACT : S.12(3)(a), S.12(2)
CONSTITUTION OF INDIA : Art.136, Art.227
(A) The impugned order of eviction was challenged under Article 227 of the Constitution invoking the supervisory jurisdiction of the High Court. The dispute pertains to a residential tenancy governed by the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947. Sections 12(2) and 12(3)(a) of the Act are material: Section 12(2) mandates that a landlord must serve a written notice demanding the standard rent before instituting a suit for recovery, and Section 12(3)(a) permits eviction only upon a tenants neglect to pay rent in arrears for six months or more, following the expiry of one month from the notice served under Section 12(2). The constitutional challenge questioned the High Courts exercise of jurisdiction under Article 227 in a matter where the statute provides a definitive appeals mechanism without provision for second appeal or revision, thereby implicating principles of statutory finality and jurisdictional restraint.
(B) The core legal principles elucidated are: (i) statutory notice and a legally compliant demand for rent are prerequisites for eviction; (ii) payment or, at minimum, a bona fide offer of payment within the statutory one-month period, when coupled with an absence of culpable delay, does not constitute neglect; (iii) the doctrine of statutory finality applies where the legislature has provided a definitive adjudication mechanism, limiting the scope of High Court intervention under Article 227 to cases of grave dereliction or abuse of legal principles; and (iv) the burden to prove neglect under Section 12(3)(a) lies with the landlord, and mere non-receipt of payment does not ipso facto establish neglect if the tenant has acted in good faith.
Facts of the case:
The appellants were tenants in possession of suit premises on a monthly residential lease at Rs 70, later increased to Rs 80. On 28-7-1972, the landlady served a notice under Section 12(2) for recovery of possession, citing arrears from 1-4-1971 and a bona fide requirement. The trial court found the latter unproved and held that arrears for more than six months were not established. The appellate court allowed the appeal, holding that the requirement of Section 12(3)(a)arrears for six months or morewas not met. The respondents then invoked Article 227, and the High Court, treating the petition as an appeal, reversed the appellate court, held the tenants in neglect for non-payment, and restored the decree. On the merits, it was found that the appellants had paid the arrears by issuing a Rs 400 money order on 1-9-1972 (covering arrears to 31-8-1972) and a Rs 500 money order on 4-10-1972 (covering arrears to 31-10-1972), both of which were refused acceptance by the landlady.
Findings of Court:
The Supreme Court held that the High Court committed a patent error by misconstruing the provision on neglect. The payment of arrears through valid instruments sent within the one-month period prescribed under Section 12(2), when not accompanied by culpable delay, does not attract the eviction provision of Section 12(3)(a). Consequently, neither Section 12(3)(a) nor Section 12(3)(b) were applicable, and the tenants were not liable to be evicted. The Court also observed that the High Court was not warranted in entertaining a petition under Article 227, as the Act provides for finality in the appellate order and the High Courts interference amounted to an unjustified assumption of unlimited supervisory power.
Issues:
(i) Whether the tenants bona fide payment of rent arrears within the time stipulated under Section 12(2) constitutes neglect within the meaning of Section 12(3)(a). (ii) Whether the High Court was justified in exercising suo motu jurisdiction under Article 227 to re-adjudicate a matter already decided by the appellate court under a special statute that provides no further appeal to the High Court.
Ratio Decidendi:
The non-receipt of monetary payment by the landlord does not, without more, establish the tenants neglect where the tenant has complied with the statutory notice requirements and dispatched payment through proper instruments within the one-month period prescribed under Section 12(2). Furthermore, where a statute provides a definitive, exhaustive remedy, the High Courts intervention under Article 227 is restricted to exceptional circumstances involving grave disregard of law or justice, and not merely on dissatisfaction with the lower appellate order.
Result:
The appeal is allowed, the judgment of the High Court is set aside, and the decree of the appellate court dismissing the suit is restored. The tenants are not liable for eviction, and the matter is remitted for the fixation of rent at a reasonable amount, with the directive to pay Rs 600 per month with effect from 1-9-1995.
(A) The impugned order of eviction was challenged under Article 227 of the Constitution invoking the supervisory jurisdiction of the High Court. The dispute pertains to a residential tenancy governed by the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947. Sections 12(2) and 12(3)(a) of the Act are material: Section 12(2) mandates that a landlord must serve a written notice demanding the standard rent before instituting a suit for recovery, and Section 12(3)(a) permits eviction only upon a tenants neglect to pay rent in arrears for six months or more, following the expiry of one month from the notice served under Section 12(2). The constitutional challenge questioned the High Courts exercise of jurisdiction under Article 227 in a matter where the statute provides a definitive appeals mechanism without provision for second appeal or revision, thereby implicating principles of statutory finality and jurisdictional restraint.
(B) The core legal principles elucidated are: (i) statutory notice and a legally compliant demand for rent are prerequisites for eviction; (ii) payment or, at minimum, a bona fide offer of payment within the statutory one-month period, when coupled with an absence of culpable delay, does not constitute neglect; (iii) the doctrine of statutory finality applies where the legislature has provided a definitive adjudication mechanism, limiting the scope of High Court intervention under Article 227 to cases of grave dereliction or abuse of legal principles; and (iv) the burden to prove neglect under Section 12(3)(a) lies with the landlord, and mere non-receipt of payment does not ipso facto establish neglect if the tenant has acted in good faith.
Facts of the case:
The appellants were tenants in possession of suit premises on a monthly residential lease at Rs 70, later increased to Rs 80. On 28-7-1972, the landlady served a notice under Section 12(2) for recovery of possession, citing arrears from 1-4-1971 and a bona fide requirement. The trial court found the latter unproved and held that arrears for more than six months were not established. The appellate court allowed the appeal, holding that the requirement of Section 12(3)(a)arrears for six months or morewas not met. The respondents then invoked Article 227, and the High Court, treating the petition as an appeal, reversed the appellate court, held the tenants in neglect for non-payment, and restored the decree. On the merits, it was found that the appellants had paid the arrears by issuing a Rs 400 money order on 1-9-1972 (covering arrears to 31-8-1972) and a Rs 500 money order on 4-10-1972 (covering arrears to 31-10-1972), both of which were refused acceptance by the landlady.
Findings of Court:
The Supreme Court held that the High Court committed a patent error by misconstruing the provision on neglect. The payment of arrears through valid instruments sent within the one-month period prescribed under Section 12(2), when not accompanied by culpable delay, does not attract the eviction provision of Section 12(3)(a). Consequently, neither Section 12(3)(a) nor Section 12(3)(b) were applicable, and the tenants were not liable to be evicted. The Court also observed that the High Court was not warranted in entertaining a petition under Article 227, as the Act provides for finality in the appellate order and the High Courts interference amounted to an unjustified assumption of unlimited supervisory power.
Issues:
(i) Whether the tenants bona fide payment of rent arrears within the time stipulated under Section 12(2) constitutes neglect within the meaning of Section 12(3)(a). (ii) Whether the High Court was justified in exercising suo motu jurisdiction under Article 227 to re-adjudicate a matter already decided by the appellate court under a special statute that provides no further appeal to the High Court.
Ratio Decidendi:
The non-receipt of monetary payment by the landlord does not, without more, establish the tenants neglect where the tenant has complied with the statutory notice requirements and dispatched payment through proper instruments within the one-month period prescribed under Section 12(2). Furthermore, where a statute provides a definitive, exhaustive remedy, the High Courts intervention under Article 227 is restricted to exceptional circumstances involving grave disregard of law or justice, and not merely on dissatisfaction with the lower appellate order.
Result:
The appeal is allowed, the judgment of the High Court is set aside, and the decree of the appellate court dismissing the suit is restored. The tenants are not liable for eviction, and the matter is remitted for the fixation of rent at a reasonable amount, with the directive to pay Rs 600 per month with effect from 1-9-1995.
A.M.KHANWILKAR, J.S.VAD, S.B.VAD, SOLI J.SORABJI
JUDGMENT
KULDIP SINGH, J.-Special leave granted.
2. Shantabai, predecessor-in-interest of the respondents herein, instituted a suit under the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 (the Act) for possession of the suit premises against the appellants-tenants. The suit was decreed by the trial court. The appellate court reversed the judgment of the trial court and decreed (sic dismissed) the suit. The Aurangabad Bench of the Bombay High Court set aside the judgment of the appellate court and restored that of the trial court. This appeal, by the tenants, is against the judgment of the High Court.
3. The suit premises was rented to the appellants for residential purposes at a monthly rent of Rs 70. The rent was, later on, increased to Rs 80. The landlady served a notice dated 28-7-1972 terminating the appellants tenancy on the grounds of default in payment of rent and bona fide requirement by her. It was mentioned in the notice that arrears of rent from 1-4-1971 were due from the tenants. As far as the bona fide requirement is concerned the trial court rejected the case of the landlady. On the issue of arrears of rent the trial court negatived the contention of the landlady that the tenants neglected to pay the rent for more than six months. The trial court, however, held that the case of the landlady was covered under Section 12(3)(b) of the Act and since the tenants failed to comply with the said provisions they were liable to be evicted. The appellate court came to the conclusion that the bona fide requirement was not proved by the landlady. On the issue of arrears it was held that the landlady, having failed to prove that the tenants neglected to pay rent for more than six months, neither the provisions of Section 12(3)(a) nor of Section 12(3)(b) of the Act were attracted and as such the appellate court allowed the appeal and set aside the judgment of the trial court. During the pendency of the appeal the original landlady died and her legal heirs were brought on record.
4. The judgment of the appellate court was challenged by the respondents by way of petition under Article 227 of the Constitution of India. The High Court converted itself into an appellate court and reappreciated all the issues dealt with and decided by the two courts below. The High Court reversed the findings of the appellate court and held that the appellants neglected to make payment of the arrears of rent in terms of Section 12(3)(a) of the Act and as such were liable to be evicted.
5. We may at this stage notice the provisions of Section 12 of the Act which are reproduced hereunder :
"12. (1) A landlord shall not be entitled to the recovery of possession of any premises so long as the tenant pays, or is ready and willing to pay, the amount of the standard rent and permitted increases, if any, and observes and performs the other conditions of the tenancy, insofar as they are consistent with the provisions of this Act.
(2) No suit for recovery of possession shall be instituted by a landlord against tenant on the ground of non-payment of the standard rent or permitted increases due, until the expiration of one month next after notice in writing of the demand of the standard rent or permitted increases has been served upon the tenant in the manner provided in Section 106 of the Transfer of Property Act, 1882.
(3)(a) Where the rent is payable by the month and there is no dispute regarding the amount of standard rent or permitted increases, if such rent or increases are in arrears for a period of six months or more and the tenant neglects to make payment thereof until the expiration of the period of one month after notice referred to in sub-section (2) the (Court shall pass a decree) for eviction in any such suit for recovery of possession.
(b) In any other case, no decree for eviction shall be passed in any such suit if, on the first day of hearing of the suit or on or before such other date as the Court may fix, the tenant pays or tenders in Court the standard rent and permitted increases then due and thereafter continues to pay or tender in Court regularly such rent and permitted increases till the suit is finally decided and also pays costs of the suit as directed by the Court."
6. As mentioned above, the landlady served notice in terms of Section 12(2) of the Act on 28-7-1972. The notice was received by the appellants on 1-8-1972. The appellants sent a money order for Rs 400 to the landlady on 1-9-1972. It is not disputed that the said amount covered the arrears up to 31-8-1972. It is also on record that another money order for Rs 500 was sent by the appellants on 4-10-1972 which covered the arrears up to 31-10-1972. The landlady refused to accept both the money orders.
7. As mentioned above, the notice under Section 12(2) of the Act was received by the appellants on 1-8-1972 and they sent the first money order on 1-9-1972. The High Court has rightly come to the conclusion that the money order, having been sent on 1-9-1972, was within "the period of one month after notice referred to in sub-section 2". The High Court, however, fell into patent error in reaching the conclusion that the actual payment having not been received by the landlady within the said period there was neglect on the part of the tenants to make payment. The sine qua non for eviction of a tenant under Section 12(3)(a) is "the neglect to make payment" and not the actual making of the payment. When a money order or a demand draft is sent to the landlord, during the specified period, it cannot be said that the tenant has "neglected to make payment". The expression neglect means "to fail to give due care, attention, or time to. To fail through thoughtlessness or carelessness. To ignore or disregard". We are of the view that in the facts of the present case it is not possible to hold that the appellants neglected to make payment within the specified period after the receipt of the notice.
8. Since the total arrears mentioned in the notice dated 28-7-1972 were paid by the appellants and there was no neglect on their part to make payment, neither the provisions of Section 12(3)(a) nor of Section 12(3)(b) are attracted in this case. The High Court fell into patent error in reversing the judgment of the appellate court.
9. Before parting with this judgment we would like to say that the High Court was not justified in extending its jurisdiction under Article 227 of the Constitution of India in the present case. The Act is a special legislation governing landlord-tenant relationship and disputes. The legislature has, in its wisdom, not provided second appeal or revision to the High Court. The object is to give finality to the decision of the appellate authority. The High Court under Article 227 of the Constitution of India cannot assume unlimited prerogative to correct all species of hardship or wrong decisions. It must be restricted to cases of grave dereliction of duty and flagrant abuse of fundamental principles of law or justice, where grave injustice would be done unless the High Court interferes.
10. We allow the appeal, set aside the judgment of the High Court and restore that of the appellate court. No costs.
11. The appellants are paying Rs 80 per month as rent since 1980. It would be fair and just to increase the rent reasonably. After hearing learned counsel we direct the appellants to pay Rs 600 as rent with effect from 1-9-1995.
For Citation: 1995(6) SC 576