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During the currency of the contract of tenancy, both the landlord and tenant can file application fo

N.MOTILAL & ORS  v.  FAISAL BIN ALI & ANR, CIVIL APPEAL NO.710 OF 2020 (Arising out of SLP (C) No. 28951 of 2019) – January 30, 2020.

CORAM: Two judge bench comprising of Justice Ashok Bhushan and Justice M.R.Shah.

The appellants, tenants in the non-residential building entered into a lease agreement with a landlord for 20 years. The landlord transferred the land to respondents by a sale deed who demanded enhanced rent citing the market rent of similar other premises. The Rent Controller allowed the application and fixed a fair rent. Aggrieved by the judgment, appeal was made before the Chief Judge who dismissed the petition. Later the HC was approached which dismissed the revision petition. This judgment has been challenged before this court.

The issue raised before the Court is whether during currency of contractual tenancy i.e. during the currency of agreed rent between the landlord and the tenant whether landlord is precluded from making an application for determination of fair rent?

The counsel for the appellants submitted that the contract of lease agreement did not end. Thus the landlord is bound by the contractual rent and the respondent cannot be allowed to file for an enhanced rent which is against the Rent Control Legislation. A strong reliance was placed on paragraph 25-30 of M/s. Raval and Co. vs. K.G. Ramachandran. Also the Model Rent Control legislation is being circulated by the Central Government to all States.

The counsel for the respondent that the judgment in M/s. Raval & Co. was further approved by seven-judge bench in V. Dhanapal Chettiar vs. Yesodal Ammal. Also it was contended that the appellants cannot make submissions regarding the sale consideration of the property

The court after considering the arguments of both the parties observed that S.4 gives rights to both the parties to make application for fixing fair rent. The majority opinion in M/s. Raval & Co. was accepted by this court. The Constitution Bench judgment in M/s. Raval & Co.’s case as well as seven-Judge Bench judgment in V. Dhanapal Chettiar’s case are binding which categorically had laid down that application for determination of fair rent can be made both by the landlord and tenant which can be made even during currency of contractual tenancy. We, thus, find the submission made by the learned counsel for the appellants in the above regard without any substance.

The court finds no merit in this appeal. Thus this appeal was dismissed.

View/Download the Judgment: N. MOTILAL & ORS. v. FAISAL BIN ALI & ANR.




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