A bank tenant challenged concurrent orders fixing fair rent for its leased premises at Rs.31,039 per month, contending the lease agreement barred enhanced rent. The High Court held fair rent fixation is a statutory right that cannot be contracted out and dismissed the revision, confirming the Rent Court's calculation.
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C.R.P(MD)No.519 of 2022
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED : 05.12.2024
CORAM :
THE HONOURABLE Mr. JUSTICE G.ILANGOVAN
C.R.P(MD)No.519 of 2022 and C.M.P(MD)No.2243 of 2022
UCO Bank represented through its Branch Manager Singampunari Town Thiruppathur Taluk, Sivagangai District.
... Petitioner / Respondent
Vs
M.Vetriselvi ... Respondent / Petitioner
Prayer : This Civil Revision Petition is filed under Section 25 of Tamil Nadu Buildings (Lease and Rent Control), Act, 1960, to call for the records relating to the judgment and decree dated 02.11.2021 made in RCA No.1 of 2017 on the file of Rent Control Appellate Authority (Subordinate Court), Sivagangai, confirming the fair and decreetal order dated 18.11.2016 made in R.C.O.P.No.4 of 2012 on the file of Rent Controller (District Munsif), Thiruppathur, set aside the same and allow the Civil Revision Petition.
For Petitioner : Mr.V.Janakiramulu
For Respondent : Mr.G.Ramapandian
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ORDER
This Civil Revision Petition is filed to call for the records relating to the judgment and decree dated 02.11.2021 made in RCA No.1 of 2017 on the file of Rent Control Appellate Authority (Subordinate Court), Sivagangai, confirming the fair and decreetal order dated 18.11.2016 made in R.C.O.P.No.4 of 2012 on the file of Rent Controller (District Munsif), Thiruppathur, set aside the same and allow the Civil Revision Petition.
by way of lease agreement, entered into the possession from 1991. The original rent was Rs.3,000/- per month. For every five years, it was agreed that 10% must be raised. The agreement period was mentioned as 20 years. The agreement came to an end in the month of December 2011. The property is located in the main road, Singampunai consisting of concrete building having two floors, windows were fitted with teakwood and flooring was laid with mosaic and apart from that it has all basic amenities, having a compound wall around it. Near the building, Bank officers' residence, school and several commercial shops are 2/10
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available, apart from a hospital. The age of the building is about 42 years. As on June 2012, the market value was Rs.30 Lakhs. Because of the development, it has raised to several Lakhs. So the respondent approached the revision petitioner to enhance the rent. But the revision petitioner refused. Seeking fixation of Rs.24,000/- per months as fair rent, the petition was filed. That was resisted by the revision petitioner by filing counter stating that a fair rent cannot be fixed against the terms of lease deed. The revision petitioner was always ready and willing to renew the lease period. Simply because, in violation of the lease agreement, he is not liable to pay enhanced rent.
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" The Tamil Nadu Building (Lease and Rent Control) Act provides for fixation of fair rent either by the tenant or by the landlord and such right is given under Section 4 of the Act and it is a statutory right given to both the parties.
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Further under Section 7(2) of the said Act, landlord shall not receive more than the agreed rent when the fair rent has not been fixed. It is seen from Section 7(2) where fair rent of the building has not been so fixed, the landlord shall not claim / receive or stipulate for the payment in addition to the agreed rent. Therefore, in the absence of fixation of any fair rent, the landlord can demand only the agreed rent and in this case as contended by the learned counsel for the revision petitioner, the agreed rent as per Exs.R1 and R2, is the rent fixed by the PWD, but that will not estop the landlord from applying to Rent Controller for fixation of fair rent and the right to fix the fair rent is a statutory right given to the tenant as well as to the landlord and therefore, it cannot be stated that the landlord is estopped from claiming fair rent as he has agreed for the rent fixed by the PWD.
As stated supra, till the fair rent is fixed, the landlord is entitled to claim only the agreed rent and in this case, the landlord has applied for fixation of fair and therefore, the agreement as evidenced by Exs.R1 and R2 will not prevent the landlord from applying to the Rent Controller for fixation of fair rent. Hence the submission of the learned Government Advocate that the petition is not maintainable cannot be accepted."
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the revision petitioner. So the petition filed by the respondent herein is maintainable before the Rent Court and the finding recorded by the Rent Court requires no interference. For fixing the fair rent, the Rent Court has taken into account the valuation certificate issued by P.W.2, the Engineer. The report was submitted and marked as Ex.P17. The guideline value of the property pertaining to 2013 was marked as Ex.P18. On the date of the petition, the building was aged about 42 years. That is admitted by both sides. The cost of construction during the relevant period namely 2012-2013 is marked as Ex.P2. The ground floor was having 1710 sq.ft. The first floor is of the equal extent and apart from AC sheet measure about 401.50 sq.ft, was also available. So it was stated that it is a 'A Group' construction. The cost of construction for the ground floor was estimated as Rs.5315/-, for the first floor Rs.4930/-, for the AC sheet roofing, Rs.3035/- per sq.ft. The building value was mentioned as Rs.1800/- for the ground floor, Rs.1700/- for the first floor and Rs.500/- for the AC sheet roofing, as per the report submitted by the engineer.
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sq.ft rate. It was corrected by the Rent Controller and the valuation of the building was fixed at Rs.16,86,375/- in total. The depreciation was taken as 1.5%. After deducting the depreciation, the total value of building was estimated at Rs.7,92,503/-. The market value of the property was fixed at Rs.950/- per sq.ft in the year 2013. The value of the land was fixed at Rs.23,11,350/-. With that, the value of the building was added. So the total value was calculated as Rs.31,03,853/-. 12% was taken as the land value since it is a commercial building. (3103853 x 12 / 12 x100 = 31,038.53) rounded off to Rs.31,039/-. That was the monthly rent fixed by the Rent Controller which is more than the claim made by the landlord.
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concurred with the fair rent fixed by the Rent Court stating that it has been fairly fixed and no interference is called for.
05.12.2024
NCC :Yes/No
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Index :Yes/No Internet : Yes/ No pnn
To
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G.ILANGOVAN, J.
pnn
ORDER IN C.R.P(MD)No.519 of 2022 and C.M.P(MD)No.2243 of 2022
05.12.2024
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2 issues framed by the court
Whether a lease agreement fixing rent can bar a landlord's statutory application for fixation of fair rent.
Whether the fair rent fixed by the Rent Controller was correctly calculated and free from perversity.
Colour shows how this judgement treated each authority
P.Venkataswami Vs. Abdul Rahim and BrothersApplied¶6
1962 (I) MLJ page 406
1 provisions across 1 enactments
UCO Bank represented through its Branch Manager
M.Vetriselvi
G.ILANGOVAN
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
