RAJU KAKARA SHETTY versus RAMESH PRATAPRAO SHIROLE AND ANR.

Citation: [1991] 1 S.C.R. 51 · Decided: 15-01-1991 · Supreme Court of India · Bench: K. JAGANNATHA SHETTY · Disposal: Dismissed

Cited by 1 judgment(s) · cites 1 · see the full citation network in Lexace

Judgment (excerpt)

RAJU KAKARA SHETIY 
v. 
A 
RAMESH PRATAPRAO SHIROLE AND ANR. 
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JANUARY 15, 1991 
[K. JAGANNATHA SHETTY, A.M. AHMADI AND 
B 
R.M. SAHAI, JJ.] 
Bombay Rents, Hotel and Lodging House Rates .Control Act, 
1947-Section 12(3)(a) and 13( l)(b)-Landlord's right to claim 
__..i.. 
education cess-When arises-Whether its yearly payment could by 
agreement be reduced to a monthiy payment, 
c 
The appellant-tenant executed a lease agreement of the demised 
premises on a standard rent of Rs.900 per month. In addition thereto, 
the tenant also undertook to pay a lump-sum of Rs.120 per month by 
way of education cess and other taxes in respect of the premises. 
1./ 
The 1st respondent filed a suit for eviction of the tenant inter alia 
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on the ground that he was in arrear of rent for more than six months 
and had failed and neglected to pay the amount within one month from 
the date of receipt of the notice served on him terminating the tenancy 
and for eviction. 
During the pendency of the suit, section 12(3) of the Bombay 
E 
~ Rents, Hotel and Lodging House Rates Control Act, 1947 was amended 
whereby clauses (a) and (b) of sub-section 3 of section 12 were deleted 
and instead a new sub-section 3 was substituted which restricted the 
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court's right to pass a decree of eviction on the ground of arrears of 
standard rent, etc., if the tenant paid or tendered in Court the arrears 
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as stipulated in the amended clause. The appellant claimed that the said 
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amendment bad retrospective effect and he was entitled to the benefit 
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thereof. 
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The Trial Court dismissed the suit. The Court held that since the 
tenant had failed to pay or deposit the arrears claimed by the eviction 
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notice within one month from the receipt thereof, he was liable to be 
evicted under section 12(3)(a) of the Act, but in view of the substituted 
section 12(3), he was entitled to protection as he had paid the entire 
arrears together with interest and costs before the passing of the decree. 
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_.,, 
On appeal, the Appellate Court reversed the decree of the trial 
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51 
A 
B 
c 
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52 
SUPREME COURT REPORTS 
[ 1991] 1 S.C.R. 
Court. The Appellate Court held that the tenant having failed to pay 
arrears within one month of receipt of a valid notice, he was liable to be 
evicted under section 12(3)(a) of the Act, since the amended section 
12(3) was prospective in nature. 
The appellant-tenant preferred a writ petition to the High Court, 
which was dismissed on the ground of sub-letting. 
Before this Court it was inter alia contended on behalf of the 
appellant that (i) since the tenant was obliged to pay the education cess 
and other taxes, by way of permitted increases, which were payable at 
the end of the year, the case would not attract section 12(3)(a) as a part 
of the rent became payable annually and not monthly and therefore the 
case attracted section 12(3)(b); and (ii) the tenant having deposited the 
arrears, etc., in time, the courts below were not justified in granting an 
eviction decree for arrears of rent under section 12(3)(a). 
On the other hand, it was contended on behalf of the respondent 
that the case was clearly governed by the provisions of section 12(3)(a) 
since indisputably the rent inclusive of the quantified tax amount was 
payable by the month. It was argued that once the quantum in respect 
of the tax was determined by agreement between the parties, the same 
formed part of the rent and it was not open to contend that notwith-
standing the agreement the tax amount remained payable by the year 
and the tenant was obliged to pay the same only after the landlord had 
paid the taxes to the local authority. 
Dismissing the.appeal, this Court, 
HELD: (1) In view of the decision of this Court, the case would be 
governed by section 12(3) as it stood before its amendment, since the 
substituted section 12(3) was found to be prospective in nature. [57G) 
Arjun Khiamal Makhijani v. Jamnadas C. Tuliani, (1989] 4 
S.C.C. 612, followed. 
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(2) It is clear from the terms of the lease agreement that the 
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parties intended the tenancy to be a monthly tenancy. [62C] 
(3) The statutory right to recover the amount of education cess in 
respect of the demised· premises from the occupant/tenant can be 
quantified by agreement of parties so long as the amount quantified 
does not exce.ed the total amount actually paid by the owner by way of 
education cess. [62E] 
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R.K. SHETIY v. R.P. SHIROLE 
53 

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