ASHARAFI DEVI MEMORIAL CHARITABLE TRUST Vs. RAM KUMAR

JUDGEMENT

(1.) WHETHER the agreed rate of rent is to be considered as basic rent within the meaning of Section 4 (2) (b) of haryana Urban (Control of Rent and Eviction)Act, 1973 (for brevity 'the Act'), in the process of fixing fair rent even after expiry of lease period stipulated in the lease deed', is the pristine legal question, which has been referred for the opinion of this Full Bench. This question has arisen on account of the view taken by a learned single Judge in the case of Gobind Ram v. Kanshi Ram, 2002 hrr 37 holding that the agreed rate of rent would not be the basic rent after the matter came up for consideration before one of us (Hemant Gupta, J.) a doubt was expressed about the correctness of the judgment rendered by the learned single Judge in Gobind ram's case (supra ). According to the reference order, a contrary view has been taken by Hemant Gupta, J. in Civil Revision No. 3114 of 1987 decided on 9-7-2003, Reported in 2004 (1) HRR 304 titled as Som Parkash v. Suresh Kumar. After noticing facts the following reference has been made for the opinion of this Bench :-

(2.) BEFORE we proceed to answer the question noticing the rival contentions, a few facts may first be noticed to put the controversy in its true perspective. The tenant-respondent was inducted as a tenant at a monthly rent of Rs. 500/- since 1-3-1995. The landlord-petitioner filed rent petition No. 15 of 24-3-2000, under Section 4 of the Act before the Rent Controller, Narwana for fixation of fair rent of the shop in question. The rent Controller did not take into account the monthly rent of Rs. 500/- being paid by the tenant-respondent as agreed rate of rent and proceeded to assess the market rent of the shop in question. Accordingly, he determined the basic rent at Rs. 5,000/- per month and made addition for fixation of fair rent in accordance with the average of All india Wholesale Price Index Numbers as per the provisions of Section 4 (3) of the Act. The learned Appellate Authority on an appeal filed by the tenant-respondent accepted the monthly rent of Rs. 500/- per month as agreed rate of rent and made the same as a basis for determining basic rent. When the matter came up for consideration before brother Hemant Gupta, J. , an apparent conflict, as noticed earlier, was found necessitating the reference to this Full Bench. It is interesting to note that the judgments in som Parkash's case (supra) and Gobind ram's case (supra) take notice of judgment of Hon'ble the Supreme Court in the case of ishwar Swaroop Sharma v. Jagmohan Lal, air 2001 SC 370 and two Division Bench judgments of this Court in the cases of bhagwan Singh and Company v. Central bank of India, (1988) 1 PLR 290 : (AIR 1989 p and H 9) and Ved Parkash v. Raj Rani, (1988)1 PLR 338. However, both the judgments have recorded a conflicting view. In Gobind ram's case (supra), the learned single Judge placing reliance on Ishwar Swaroop sharma's case (supra) has come to the conclusion that the Division Bench judgment in Bhagwan Singh and Company's case (supra)and Ved Parkash's case (supra) were impliedly overruled by keeping in view of the decision of Hon'ble the Supreme Court in ishwar Swaroop Sharma's case (supra ).

(3.) MR. J. R. Mittal, learned senior counsel for the landlord-petitioner supporting the view taken in Gobind Ram's case (supra) !has submitted that under section 4 (2) (b) of the act, the only question which needs to be an-swered is whether there was agreement of tenancy in operation stipulating the rate of rent payable when the application for fixation of fair rent was filed. According to the learned counsel, in the absence of any such subsisting agreement stipulating rate of rent, it cannot constitute a basis for fixing basic rent as postulated by Section 4 (2) (b)of the Act. He has maintained that the shop in dispute was constructed after 1962 which would attract the provisions of Section 4 (2) (b), which is on rent at the rate of Rs. 500/- per month since 1 -3-1995. The aforementioned rate of rent cannot be considered as agreed rent between the parties and the market rate of rent has been rightly assessed by the Rent Controller keeping in view the similar sized shop on rent in the locality which have been proved by Exhibits A-2, A-3 and A-4. He has also emphasised that the judgment of Hon'ble the Supreme Court in the case of Ishwar Swaroop Sharma's case (supra) would not apply to the facts of the presemt case because in that case tenancy was created in 1975 and the rate of rent was increased to Rs. 200/- per month in 1976. When application for fixation of fair rent was made in 1989 it was held that agreed rate of rent after expiry of tenancy was Rs. 200/-per month which was accepted to constitute a basis for concluding the same to be basic rent. According to the learned counsel there is no such agreement after the ex-piry of the lease period and, therefore, the judgment in Ishwar Swaroop Sharma's case (supra) would not apply to the facts of the present case. He has vehemently submitted that the view taken by the learned single judge in Gobind Ram's case (supra) lays down correct law and is thus deserved to be upheld