PUNJAB NATIONAL BANK Vs. STATE OF BIHAR

JUDGEMENT

(1.) THIS is an appeal by the tenant of a commercial building. Although a caveat was filed on behalf of the respondent -landlord, no one was present to argue on behalf of the respondent when the case was called on for hearing.

(2.) THE Punjab National Bank; the tenant, advanced some amounts to the landlord for construction of a building. The building was mortgaged to the Bank. The ground floor of the building was built to suit the needs of the Bank and was let out by the landlord to the Bank on a rent of Rs. 1,850/ - per month. The lease commenced on 1.11.1970. The term was of 15 years and hence the term of the lease came to an end on 31.10.1985. There was an option for renewal with the tenant on paying enhanced rent at the rate of Six Paise per square foot. The total area occupied was five thousand square feet. Apparently, in view of the reluctance on the part of the landlord to enter into a fresh agreement, the Bank had filed a suit for enforcing the right of renewal available to it under the lease transaction. It is said that the suit was decreed ex pane.

(3.) SECTION 5 of the Rent Act enables the landlord to seek the fixation of fair rent and get it fixed on showing that the rent that was being paid was low. Of course, the tenant has the corresponding right to approach the Court for fixation of fair rent by showing that what he had agreed to pay was excessive. Therefore notwithstanding the contract between the parties, the landlord had right to approach the Rent Controller for fixation of fair rent. That is what the landlord did in this proceeding. In that context, Sections 5 and 8 of the Rent Act and Rule 3 of the Bihar Buildings (Lease, Rent and Eviction) Control Rules, 1983 are relevant. The Rent Controller made an enquiry regarding the rent fetched in the locality for buildings similarly situated and the Authorities came to the conclusion that a sum of Rs. 18,000/ -would be a reasonable rent since the prevailing rate of rent was not less than Rs. 3.50 per square foot. In this case, the area involved is 5000 square feet. It is in that situation, the learned Single Judge held that no ground was made out for interference in this proceeding under Article 226 of the Constitution of India.