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Standard Pharmaceuticals Ltd. vs. Gyan Chand Jain: A Case Study

This article contains the case study of the case, 'Standard Pharmaceuticals Ltd. vs. Gyan Chand Jain & Anr., 97(2002) DLT290' related to Delhi Rent Control act. In this case study, various crucial sections of the limitation act and the Delhi Rent Control Act is discussed.

Moreover, the conditions under which a tenant can be asked for eviction under the Rent Control Act are also being elaborators discussed. The Supreme Court has answered various questions which are in ambiguity and those terms about which the rent control act is silent. The questions of jurisdiction of various courts under the act are also being discussed in the case. So, this is the case study where the eviction of the tenant and the increase of rent of the landlord were in question.

  • The facts of the case as they emerge from the record that on 1st April 1968 the said premises were let out to standard pharmaceutical ltd, 24, Park Street, Calcutta by the respondent. Where under the appellant had an agreement to pay the rent to the respondent at the rate of Rs. 2000. After the lapse of the years, the rent was increased from 2000 rs to 2500/-wef 1st April 1983, and further, after 5 years, the rent was again increased from 2500 rs to 3000 on 1st April 1988. After the amendment in the Rent Control Act in 1988, the plaintiff landlord gave a notice dated 5th January 1991 and increased the rent 10% from 3000 rs per month to 3,300 per month.
  • Therefore, the tenant failed to pay the rent. The plaintiff filed a petition for the eviction in the court of rent controller and the defendant gave notice and filed the suit under section 6 and section 9 of the Delhi Rent Control Act 1958 for the determination of the standard rent of the said premises.
  • The tenant filed a written statement/reply to the aforesaid petition for the eviction filed by the landlord and disputed the jurisdiction of the civil court under section 50 of the Delhi Rent Control Act and contended that there was no cause of action. On the other hand, the landlord denied that the rent was ever increased from 2000 rs to 3,300 rs. And he was receiving rent at the rate of 2000 rs plus 1300 per month as a service charge.

Questions of law/ issues raised
  1. Whether the word 'rent' includes payment in respect of amenities or services provided by the landlord under the terms of tenancy?
  2. Whether the agreement between the landlord and the tenant in regards to additional amenities come under the scope of DRC ACT, 1958?
  3. Whether the civil court shall have jurisdiction to entertain the suit in view of the provisions under section 50 of the DRS act, 1958?
  4. Whether the order passed by the learned trial court and the appellate court is justified?

Contention of petitioner
  • The learned counsel for the petitioner contended that the delay of filing an appeal was not properly explained by the landlord as the result as it was refused to entertain the application for the condition of delay by the appellate court and in support of his contention, the counsel relied upon the case of Banwari Lal vs. Union of India in which the court held that the mistake of the Council could not be treated to be bonafide and delay must be properly explained day by day and with just and reasonable cause.
  • The learned Counsel for the appellants also urged that the learned trial Court was not justified in taking judicial notice of the fact of an increase of rents the next contention of Counsel appearing for the appellant that the interest awarded by the learned Trial Court for the damages is unknown in law.
  • It was argued that the notice which purports to increase the rent by 10% was received even then the rent could be deemed to have a raised to 2,200 rs it was contended that the petitioner/ tenant had already admitted deposit the rent excluding the furniture rental in the terms of the direction of the court under Section 11(1) d under Bihar building lease rent and eviction Control Act, 1999.
  • And since the landlord denied the supply of the furniture and the plea was not allowed to be raised by the landlord.
  • It was contested that there have been loopholes in the order passed by the trial court and the appellate court. as the suit is barred by the provisions of section 50 of the Delhi Rent Control Act.
  • In the present case, the lease deed only rent of 2000 rs was mentioned. the charges which are payable by the petitioner/tenant to the respondent /landlord as maintenance charges would also fall in the ambit of the express rent.
  • The notice of the enhancement of further rent was not given as per the terms and conditions defined under section 6 A and Section 8 of the Delhi Rent Control Act.
  • The learned counsel submitted that it is not an admitted fact that rent stood increased by service of the notice, for there was no such admission in the written statement.
  • The application allowed by the learned trial court under order 12 rule 6 was not justified and it needed to be modified by the court because there was a material irregularity or illegality in the impugned order.

Contention of respondent
  • The learned counsel for the respondent contended that the Civil Court has full jurisdiction for the matter would fall within the jurisdiction of the rent controller for the purposes of the eviction.
  • The respondent submits that there was a just and reasonable cause for the delay of 55 days in filing the appeal in the appellate court. The learned counsel for the respondent-landlord, on the other hand, argued that the onus of proving the rate of rent was upon both the parties and not upon the respondent alone. He submitted that the respondent had discharged the onus placed upon him, but the appellant had miserably failed to discharge its onus.
  • It was argued that the service charges are not included in the term 'rent'.
  • The rate of the rent in the term of lease deed is only 2,000 and 1300 were payable as service charges which have been increased later.
  • the learned senior counsel in the support of his contention relies upon the case of Karnami properties Limited vs. Augustin in which the court observed that although the expression 'rent' has not defined but also the payment in respect of the amenities are the services provided by the landlord into the term of the tenancy.
  • It was a default in the payment of the rent, the rent that was fixed by the rent controller which would furnish ground for eviction under section 11(1) d of the Delhi Rent Control Act.
  • It was contended that the suit was not barred under provisions of section 50 of the Delhi Rent Control Act as it was already ordered by the additional district judge.
  • it was contended that the service charges are not part of the term 'rent' and thus the rate of the rent up to 31st March was 3300/-
  • the learned counsel for the appellant also contended that the trial court has based its judgment on some form of res judicata, in that, the trial court has held that the finding of the Rent Controller (RC) that the rent of premises was Rs.3630 per month has become final between the parties.
  • As the learned trial court allowed the application under Order 12 rule 6 was justified as there was no material irregularity or illegality in the impugned order and it was also argued that the relationship between the petitioner and the respondent was governed by the Delhi rent Control Act.

Opinio juris
(Reasoning and point of laws, interpretation of law and connection with facts of the case)
  1. Limitation act, 1963- section-5
  2. Delhi rent control act, 1958 - section- 3, 6A, 8
  3. Code of civil procedure(CPC), 1908- Order 12, Rule 6

Obiter dicta
  • It is a well-established proposition of the law that the rental deals are subject to National legislation and the landlord cannot include clauses, which goes along the lines of something like a deal in paying for rent will result in water/electricity being cut.
  • The landlord cannot evict a tenant for no apparent reason. The eviction must always have a strong and valid reason behind it. The word rent not only includes what is originally described as rent in the agreement between a landlord and the tenant under the agreement between them.
  • Any payment made towards the maintenance charges of the premises, any amenities provided to the tenant, and all payments which are agreed to be paid by a tenant to his landlord for the use, occupation also of furnishing, electric installations would also fall under the purview of the expression rent.

Observation of court
  • The court observed that it was a default in the payment of the rent, that rent is fixed by the rent controller and it would furnish a ground for eviction under section 11(1) d of the act. The default of the furniture rent which is agreed by the defendant subsequent to lease cannot be brought within the mischief of section 11 (1) d which entitled the landlord to a decrease of eviction. as per the findings of the first appellate Court, the furniture rent remains divorced from the rent of the premises. under the original demise.
  • The court has also observed that even if the furniture was returned, in that case, the lease for the buildings still would not be affected. The court was unable to see any justification for the same as the findings of the learned trial court appear to be passed on a correct appreciation of the facts and the evidence adduced before the trial court in the light of the law laid down by this Court
  • The court also rejected the contention which stated that in the case of default in the payment of rent where the furniture could be withdrawn without any eviction from the tenanted premises in the same matter and held that it was a different matter and it could not be said about the service.
  • The court also held that the tenancy which carries with it certain amenities, which need to be provided or services to be maintained by the landlord, is under the scope of the act.
  • if it does not fall under the scope of the act then the landlord has a right to impose conditions within the reference to supply of amenities as binding terms of tenancy on the tenant and also may circumvent the provisions of the act.
  • An agreement related to the payment for the furniture was according to the finding of an independent contractor that is unconnected with the original tenancy.
  • The court also held that the suit is not barred under the provisions of section 50 of the daily control rent act.

Ratio decendi
  • The law also settles to consolidate the considerable figure of rent of objection relating to jurisdiction under section 50 of the Delhi control rent act.
  • The court denied the proposition that the service charge would not include the term rent.
  • While considering the scope of section 50 of the Delhi control rent act, the charges which are paid to the respondent by the petitioner as maintenance charges would also come under the expression rent.
  • In the view of the foregoing case law, the court now starts to assume that a service charge of Rs.13000 is also part of the expression 'rent' and thus the rate of rent up to 31st March 1994 was also Rs. 3300.
  • section 6 A states that if there is no standard rent fixed in respect of any premises, the landlord may increase by 10% every three years.
  • Section 8 A states that if the landlord wishes to increase the rent in respect of any premises he must send a notice of his intention to increase the rent to the tenant as such increase is lawful under the act. It shall be due and recovered only in respect of the period of the tenancy only after the expiry of the 30 days from the date on which the notice is sent and such notice shall be in writing and signed by the landlord and must be in a manner provided under section 106 of the transfer of the property act, 1882.
  • The court held that until and unless the service for notice under section 6 A read with Section 8 is not being disputed, its impact is required to be seen.

  • The rent could be legally increased after three years and held that the rate of rent on 1st April 1994 was raised to 3630/- the court justified the order passed by the trial court to allow the application under Order 12 rule 6.

  • After filing a review petition before the court, the court finds nothing material illegality or irregularity with the impugned order of the Learned Trial Court and Appellate court and therefore dismiss the partition without any interference in the impugned order and left the parties to bear their own costs as the question of law involved in the court.

  • no landlord or tenant has a right to cut off or withhold any essential supply or service enjoyed by the tenant or the landlord without any just and sufficient cause, in respect of the premises, let to him. Rent authority may pass an order for the restoration of the amenities and immediately or may pass any other interim order if the authorities satisfied that the essential supply your services cut off enjoyed by the tenant was cut off without any Justin sufficient cause.
The Rent Control Act was passed by the parliament to protect the interest of the tenants. But sometimes this act is also being misused by the tenants. Under the act, a landlord can ask the tenant for the eviction of its premises under some conditions only. The act needs to be a little liberal for landlords. However, in the present case, the court has given the order in the support of the landlord. But on the contrary to this, it is also unauthorized to cut off the supply of the tenant.

At most of the places, the landlords take the service charges for electricity, water, etc. along with Rent. The MPCs service is recently provided by the government and is also used in various parts and societies in UP could be a solution to this problem. MPCs are being provided by the government so that tenant can easily pay their water, electricity bills to the competent authority.

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