VISHWANT KUMARversusMADAN LAL SHARMA AND ANR.

A                             VISHWANT KUMAR
                                         v.
                     MADAN LAL SHARMA AND ANR.

                               MARCH I 8, 2·004

B        [V.N. KHARE, CJ., S.B. SINHA AND S.H. KAPADIA, JJ.)


          Delhi Rent Control Act, 1958 ; Sections 4 & 9-Amending Act 57 of
    1988; Section J(c)-Application by tenant before Rent Controller for fixation    _{.
C   of standard rent-During pendency of the application, Amending Act
    introduced-Rent Controller dismissing the application being infructuous on
    ground of subsequent amendment-Tribunal and High Court concurring with
    the Rent Controller-Correctness of-Held, right of a tenant under the Act is
    a protective right and not a vested right-Hence after amendment, the right
    of tenant would cease to exist.
D
          Appellant-tenant entered into an agreement with respondent-
    landlord in 1976 for taking on rent a shop on a monthly rent of Rs. 5000.
    In 1978, the appellant-tenant filed an application before Rent Controller         y ·
    for fixation of standard rent to the shop under section 9 of the Delhi Rent
E   Control Act, 1958 seeking to fix the monthly rent at Rs. 1350 per month
    instead of Rs. 5000. which was excessive. During the pendency of the
    application before the Rent Controller, on 1.12. I 988, section 3(c) was
    inserted by an Amending Act providing that the provisions of the Rent
    Act would not apply to the premises whose monthly rent exceed Rs. 3500.
    The respondent-landlord moved an application before the Rent Controller
F   seeking dismissal of the standard rent application of the appellant in view
    of the amended section 3(c). The Rent Controller dismissed the standard
    rent application holding it to be infructuous in view of the amended section.
    Tribunal and High Court dismissed the appeals of the appellant-tenant.

          In appeal to this Court, the appellant-tenant contended that section
G 4 of the Rent Act conferred a substantive right to the tenant not to pay
    rent in excess of the standard rent; that the !is commenced on the date of
    application to the Rent Controller for fixation of standard rent; that the
    rights of the appellant got crystallized under the Act on making an
    application; that the Rent Act being a beneficial legislation, the
H                                       254
                          VISHWANT KUMAR v. M.L. SHARMA                          255
         Amendment Act, while inserting section 3(c) to the Rent Act, did not intend    A
         to obliterate the rights vested in the appellant on the date of the
         application; that the appellant cannot be made to suffer on account of
         court's delay by relying on the doctrine of "Actus curiae neminem gravabit";
         and that the right not to pay rent in excess of the standard rent did not
         depend on its fixation by the Rent Controller and that it was on incident      B
         of tenure and consequently it was not in the nature of protective right.

               Dismissing the appeal, the Court
    .)
               HELD: I. I. There is a difference between a mere right and what is
         right acquired or accrued. Under section 4 of the Delhi Rent Control Act,      C
         1958, the tenant is not bound to pay rent in excess of the standard rent
         whereas under section 9, he has a right to get the standard rent fixed. Such
         a right is the right to take advantage of an enactment and it is not an
         accrued right. There is a vast difference between rights of a tenant under
         the Rent Act and the rights of the landlord. The right of a statutory tenant
         to pay rent not exceeding standard rent or the right to get standard rent      D
         fixed are protective rights and not vested rights. On the other hand, the
         landlord has rights recognized under the law of Contract and Transfer
1        of Property Act which are vested rights and which are suspended by the
    '
         provisions of the Rent Act but the day the Rent Act is withdrawn, the
         suspended rights of the landlord revive. 1257-G-H; 258-A; C-DI
                                                                                        E
              D.C Bhatia v. Union of India, !199511 SCC 104; Thyssen S1ahlunion
         GMBH v. Steel Authority 1J( India Ltd, 119991 9 SCC 334 and Parripati
         Chandrasekhar Rao & Sons v. Alapati Jalaiah, 1199513 SCC 709, referred
         to.

               1.2. The object of the Amending Act, 1988 was to rationalize the         F
         Rent Act whereby the protection given to the richer tenant is withdrawn.
         The object of the Amendment Act, 1988 is to strike a balance between
         the claims of the landlord who get meagre rent particularly in times of
         inflation and the tenants who equally need protection from arbitrary
         eviction. In the circumstances, in view of section 3(c) as amended, the        G
         application for fixation of standard rent filed by the tenant on 11.4.1978
         has been correctly dismissed as infructuous. 1258-D-fl

A            Ambalal Sarabhai Enterprises ltd v. Amrit Lal & Co. and Anr.. 120011
         8 sec 397, relied on.
                                                                                        H
    256                   SUPREME COURT REPORTS                    (2004 J 3 S.C.R.

A        Atma"Ram Milla! v. lshwar Singh Punia, 119881 4 sec 284 and Mis.
    Raval & Co. v. K.G. Ramachandran, 1197411 SCC 424, distinguished.

          1.3. Where there is an agreed rent between landlord and tenant
    either prior or earlier to the Amending Act providing that the provisions
    of Rent Act will not apply to the premises whose monthly rent exceeded
B   Rs. 3500, the tenant is estopped from taking a plea that it is not the
    standard rent. 1260-AJ

          CIVIL APPELLATE JURISDICTION : Civil Appeal No. 4070 of2002.
                                                                                      ,(.
          From the Judgment and Order dated 4.5.2001 of the Delhi High Court
c   in S.A.O. No. 4 of 2001.

          V.R. Reddy, Pradeep Dewan, Sakya Singha Chaudhuri, Pramod B.
    Agarwala, Navin Kumar, Ms. Anupama Dhingra and Ms. Praveena Gautam
    for the Appellant.

D        T.L.V. Iyer. S. Balakrishnan, Subramonium Prasad and S.N. Jha for the
    Respondents.

          The Judgment of the Court was delivered by
                                                                                       .,.. .

           KAPADIA, J. The Delhi Rent Control Act, 1958 (hereinafter referred
E   to for the sake of brevity as "the Rent Act") was amended by Act No.57 of
    1988. The said Amending Act came into effect from I .12.1988. Section 3(c)
    of the Amending Act provided that the provisions of the Rent Act will not
    apply to premises whose monthly rent exceeded Rs. 3500. The question
    which arises for determination in this civil appeal is - whether section 3(c)
    as amended was applicable to standard rent application, which was pending
F
    before the Court on 1.12.1988 when the Amending Act came into forre?                    ...,
          On 7th May, 1976, an agreement was entered into between the appellant
    - tenant and the respondent - landlord, under which the appellant took on
    lease a shop on a monthly rent of Rs. 5000 per month. On 11.4. 1978, the
G   appellant filed a petition for fixation of standard rent under section 9 of the
    Rent Act. The contention of the appellant was that the standard rent should
    be fixed at Rs. 1350 per month and that the rent agreed upon at Rs. 5000 per
    month was excessive. On 23.3.1987, the respondent filed his written statement.
    The case was pending on 1.12.1988 when section 3(c) was inserted by                     ,.     ~

    Amending Act 57 of 1988. On 27.5.2000, when the case was pending, the
H
          VISHWANT KUMAR v. M.L. SHARMA [KAPADIA. J.]                     257
respondent moved an application tinder section 151 CPC before the Rent            A
Controller seeking dismissal of standard rent application made by the tenant,
in view of amended section 3(c). By order dated 16.12.2000, the Rent
Controller allowed the landlord's application and consequently dismissed the
standard rent application made by the tenant as incompetent and not
maintainable. Being aggrieved, the appellant herein preferred appeal No.9 of      B
200 I before the Tribunal which was dismissed. Aggrieved, the appellant
herein preferred second appeal bearing S.A.O. No.4 of 200 I in the High
Court which was also dismissed by the impugned judgment dated 4.5.200 I.
Hence, this Civil Appeal.

       Mr. Y.R. Reddy, learned senior counsel for the appellant submitted that C
section 4 conferred a substantive-Hg.ht on the tenant not to pay rent in excess
 of the standard rent except to the extent of lawful increase of the standard
rent in accordance with the provisions of the Act. Os 11.4.1978, pursuant
to the right wnferred under the Rent Act, the appellant filed a stl!Pdard rent
application. It was urged that on 11.4.1978 the tenant had a right to apply
for fixation of standard rent without limit. It was urged that when the /is D
commenced on 11.4.1978, all the rights of the appellant got crystallized.
That the Rent Act was a beneficent legislation and the Amendment Act while
!nserting section 3(c) did not intend to obliterate the rights vested in the
appellant on the date of his petition for fixation of standard rent. It was
vehemently urged that the appellant can not be made to ·suffer because of E
court's delay. In this connection, learned.counsel for the appellant relied on
the doctrine of "Actus curiae neminem gravabit". It was further contended
that the right not to pay rent in excess of the standard rent did not depend
on its fixation by the Rent Controller, that it was on incident of tenure and
consequently it was not in the nature of protective right. In this connection,
it was submitted that limited repeal in section 3(c) did not affect any right, F
privilege, obligation or liability acquired under any enactment and, therefore,
such a right was not intended to be taken away by section 3(c) of the Rent
Act. In support of his arguments, learned counsel relied upon several
judgments of this Court.

       We do not find merit in the above arguments. There is a difference         G
between a mere right and what is right acquired or accrued. We have to
examine the question herein with reference to sections 4, 6 and 9 of the Act.
It is correct that under section 4 of the.Rent Act, the tenant is not bound to
pay rent in excess of the standard rent, whereas under section 9 he has a right
to get the standard rent fixed. Such a right is the right to take advantage of    H
    258                   SUPREME COURT REPORTS                   [2004) 3 S.C.R.

A an enactment and it is not an accrued right. In the case of C. C. Bhatia v.
  Union of India, reported in [ 1995] I SCC I04, it has been held that right of
  a statutory tenant to pay standard rent is a right to be governed by the Act
  and if the legislature repeals the Act or a part of it, the statutory tenant can
  do nothing about it. It is a mere right and not a vested right. To the same
  effect is the judgment of this Court in the case of Thyssen Stahlunion GMBH
B v. Steel Authority of India ltd., reported in [1999] 9 sec 334, in which it
  is held that right to be governed by the Act is not a right of an enduring
  nature. What is unaffected by repeal is a right acquired or accrued under the
  Act. That till the decree is passed. there is no accrued right. The mere right     ..4.
  existing on date of repeal to take advantage of the repealed provisions is not
C a right accrued within section 6( c) of the General Clauses Act. Further, there
  is a vast difference between rights of a tenant under the Rent Act and the
  rights of the landlord. The right ofa statutory tenant to pay rent not exceeding
  standard rent or the right to get standard rent fixed are protective rights and
  not vested rights. On the other hand, the landlord has rights recognized
  under the law of Contract and Transfer of Property Act which are vested
D rights and which are suspended by the provisions of the Rent Act but the day
  the Rent Act is withdrawn, the suspended rights of the landlord revive. See:
  Parripati Chandrasekhar Rao & Sons v. Alapati Jalaiah, [1995] 3 SCC 709.             1 ·
  Lastly, as held by this Court in the case of D.C. Bhatia, (supra), the object
  of the amending Act, 1988 was to rationalize the Rent Act whereby the
E protection given to the richer tenant is withdrawn. The object of the
  Amendment Act. 1988 is to strike a balance between.the claims of the landlord
  who get meager rent, particularly in times of inflation and the tenants who
  equally need protection from arbitrary eviction. In the circumstances, we
  hold that in view of section 3(c) as amended, the application for fixation of
  standard rent filed by the tenant on 11.4.1978 has been correctly dismissed
F as infructuous. We have gone through the decisions cited by the learned
  counsel for the appellant. The case of Ambalal Sarabhai Enterprises ltd. v.
  Amri1 Lal and Co. and Anr., [2001] 8 SCC 397 was a case involvin!; rights
  of a landlord under section 14(1)(b) of the said Act. It was held that a
   ground ofeviction based on illegal sub-Jetting under section 14( I )(b) of the
G Rent Act would not constitute a vested right of landlord, but it would be a
   right within the meaning of section 6(c) of the General Clauses Act if
   proceeding for eviction is pending. however, the tenant has no vested right
   under the Rent Act as the tenant has only a protective right. In the present
   case. we are concerned with the nature of rights of the tenant under the Rent
   Act. The ratio of this decision supports our above view.
H
             VISHWANT'KUMAR v. M.L. SHARMA [KAPADIA . .I.]                    259

         The judgm·ent of this Court in the case of Atma Ram Mittal v. !shwar         A
   Singh l'unia, reported in (1988] 4 SCC 284 has no application to the present
   case. In that case, the landlord had instituted the suit, in civil court in·
    Haryana, for possession of the shop rented out to the tenant in 1978, on the
   ground of arrears of rent. It was filed in the civil court as the premises in
   question were exempted for l 0-years from the Rent Act. On behalf of the           B
   tenant, it was urged that in view of section 1(3) of the Rent.Act the suit was
   not maintainable and under section 20 of the Rent Act the jurisdiction of the
   civil court was barred. However, during the pendency of the litigation, the
   period of exemption/immunity expired. The question was whether the premises
   which was not I 0-years old on the date of the suit and which was exempted
   from the operation of the Rent Act would be governed by it on expiry of ten        C
   years during the pendency of the litigation. The tenant succeeded before the
   High Court on the ground that the suit was filed during the immunity period
   and it was barred under section 20 of the Rent Act. Allowing the appeal, this
   Court held that if the immunity from the Rent Act depended upon the ultimate
   disposal of the case within ten years, which is in reality an impossibility, the
    immunity would become illusory. In coming to that conclusion, this Court          D
    invoked the doctrine of actus curiae neminem gravabit - an act of the Cou11
   shall prejudice no man. In that case, the rights of the landlord under the Rent
   Act were suspended for JO-years but on expiry they stood revived. The
   matter was concerning the rights of the landlord. In the circumstances, the
   judgment of this Court in the Atma Ram Mittal (supra) has no application to        E
   the facts of the present case.

         Similarly, the judgment of this Court in Mis Raval & Co. v. K.G.
  Ramachandran, (1974] I SCC 424 has no application to the facts of the
  present case. In the said case, one of the arguments advanced on behalf of
  the tenant was that the fixation of fair rent under the Tamil Nadu Rent F
  Control Act .:ould only be downwards from the contracted rent and the contract
  rent was not to be increC\sed. It was held by this Court, by a majority
  decision, that the Tamil Nadu Rent Control Act was a complete Code in
  respect of contractual tenancies. as well as statutory tenancies. That the
  scheme of the Act was different from the Bombay Rent Act. On close G
  reading of the Tamil Nadu Rent Control Act, this Court found that the fair
  rent was required to be fixed for the building which was something like an
  incident of tenure regarding the building. This conclusion was based on the
  scheme of the Tamil Nadu Rent Control Act. Hence, the judgment of this
• Court in the case of Mis Raval & Co. (supra) has no application to the facts
  of this case.                                                                  H
    260                    SUPREME COURT REPORTS                   [2004] 3 S.C.R.

A         In any event of the matter where there is an agreed rent between landlord
    and tenant either prior or earlier to the Amending Act providing that the
    provisions of Rent Act will not apply to the premises whose monthly rent
    exceeded Rs. 3500, the tenant is estopped from taking a plea that it is not the
    standard rent.

B        For the aforestated reasons, there is no merit in this civil appeal and
    accordingly the same is dismissed with no order as to costs.

    B.S.                                                       Appeal dismissed.




                                                                                      .., -




                                                                                              •