NAND LAL AGARWAL versus GANESH PRASAD SAH & ORS.

Citation: [1988] SUPP. 2 S.C.R. 303 · Decided: 09-08-1988 · Supreme Court of India · Bench: R.S. PATHAK · Disposal: Dismissed

Judgment (excerpt)

NANO LAL AGARWAL 
v. 
GANESH PRASAD SAH & ORS. 
ii; 
AUGUST 9, 1988 
[R.S. PATHAK, CJ AND S. NATARAJAN, J.] 
Bihar Buildings (Lease, Rent and Eviction) Control Act, 1977: 
Sections 4, 7 and 8---Eviction of tenant sought by landlord for default in 
payment of rent-Amount in excess of rent paid by tenant without 
·approval of Rent Controller-Whether tenant entitled to adjustment 
towards rent arrears without exercising option for such adjustment. 
A suit tiled by the respondent-landlord for eviction of the 
appellant-tenant from the leased premises on grounds of (i) bona fide 
requirement, (ii) default in payment of rent for five months, and (iii) 
wrongful use of leased premises, was decreed by the trial court and the 
appellate court on first two grounds. 
Rejecting the contention of the appellant-tenant that a sum of 
Rs.180 out of the advance of Rs.300 paid to the respondent and the 
excess amonnt of rent at Rs. 70 p.m. as against the contractual rent of 
Rs.60 p.m., collected by the respondent-landlord in contravention of 
sections 4 and 7 of the Bihar Buildings (Lease, Rent and Eviction) 
Control Act, 1977, ought to have been appreciated by the respondent-
landlord towards rent arrears, both the courts concurrently held that 
there was no proof that the appellant-tenant had paid the advance and 
that although increase in rent from Rs. 60 to Rs. 70 p.m. on the basis of 
providing additional amenities was not permissible under the Act, the 
appellant could not take advantage of the situation as he bad failed to 
exercise his option under s. 8(2) of the Act to seek adjustment of the 
I 
excess payment of rent arrears. 
A 
B 
c 
D 
E 
F 
The High Court sustained the decree on the ground of default in 
payment of rent. Affirming the finding of the courts below, it observed 
that the appellant's prayer for adjustment could be sustained only if he 
G 
had exercised his right of option under s. 8(2) of the Act. 
Assailing the view of the High Court the appellant-tenant filed the 
appeal' in this Court. 
Dismissing the appeal, this Court, 
303 
H 
304 
SUPREME COURT REPORTS 
[1988] Supp. 2 S.C.R. 
A 
HELD: I. Without the tenant calling upon the landlord to adjust 
the excess payments towards the arrears of rent, he cannot seek such a 
right in the suit filed by the tenant by way of defence in the suit for 
B 
c 
D 
E 
F 
eviction. [3088] 
• 
2.1 Under sub-section (2) of Section 8 of the Bihar Buildings 
(Lease, Rent and Eviction) Control Act, 1977 if any rent has been 
collected in excess of the fair rent determined for a building, then the 
tenant is entitled to a refund of the excess amounts paid by him, unless 
he opts for a different course of action viz., the adjustment of the excess 
payment towards rent, past or future. [307G] ' 
2.2 Though s. 8(2) deals with payment of excess rent for build-
ings for which fair rent has been determined or re-determined by the 
Controller, the same principle, in the absence of a different prescrip-
tion under the Act, has to govern the buildings for which the rent is 
payable in accordance with the terms of the contract between the 
parties. [307H, 308A] 
2.3 Therefore, even if the rent for the building leased out to the 
appellant had not been determined by the Controller but had been fixed 
by the parties themselves, the right to seek adjustment of the excess 
payments made by the appellant has to be in accordance with the princi-
ple set out ins. 8(2). [3088] 
The High Court had, therefore, not erred in any manner in refusing 
to countenance the appellant's plea regarding the adjustment of the 
excess payment made by him towards arrears of rent, without his hav-
ing opted for such adjustment and calling upon the respondent to make 
such adjustments. [309E] 
Sarwan Kumar Onkar Nath v. Shri Subhas Kumar Agarwal/a, 
AIR 1987 SC 2302 and Smt. Draupadi & Ors. v. Gorakhnath Gupta & 
Ors .• I 1988] Suppl. SCC 571 distinguished. 
Budhwanti and Anr. v. Guiab Chand Prasad, [1987] 2 SCC 153 
G 
and 
Mohd. 
Sa/imuddin 
v. 
Misri 
Lal, 
[1986] 
2 SCC 
378 
referred to. 
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 977 
of 1986. 
H 
From the Judgment and Order dated 30. 7. 1985 of the Patna High 
N.L. AGARWAL v. G.P. SAH [NATARAJAN, J.l 
305 
Court in Appeal from Appellate Decree No. 96 of 1982. 
A 
M.P. Jha for the Appellant. 
S.N. Jha for the Respondents. 
The Judgment of the Court was delivered by 
B 
NAT ARAJAN, J. This appeal by special leave is directed 
against a judgment of the High

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