D.R.DHANUKA,J. - (1.) BY this petition filed under Article 227 of the Constitution of India, the petitioner has impugned decree dated 31st July, 1981, passed by the learned Joint Judge, Pune, in the Civil Appeal No. 642 of 1979 arising from decree of dismissal of suit passed by the trial Court on 2nd August, 1979, in Regular Civil Suit No. 1885 of 1975.
(2.) THE crucial facts required to be stated for the purpose of disposal of this petition are as under :- (a) The respondents are the owners of House No. 112 Parvati, Pune. On 2nd May, 1972, the respondents let out Block No. 5 in said house consisting of two rooms each admeasuring 12' x 9', two balconies each admeasuring 12' x 9' along with the appertaining bathroom and the privy to the petitioner. The agreement of tenancy dated 2nd May, 1972 is in writing. The monthly rent payable by the petitioner-tenant in respect of the said premises was fixed at Rs. 150/-. The said written agreement in terms provided that the advance payment of Rs. 10,000/- paid by the petitioner to the respondents in order to enable the respondents to construct the building would be adjusted by monthly instalments of Rs. 75/- against the liability of the petitioner to monthly rent of Rs. 150/-. (b) Upto February 1972, there were no dispute between the parties. The petitioner paid monthly rent payable in respect of the said premises to the respondents in accordance with the stipulations contained in the said agreement i.e. at the rate of Rs. 75/- per month. The petitioner made payment of rent to the respondents at the rate of Rs. 75/- per month after taking credit for balance of the rent at the rate of Rs. 75/- per month in view of the "advance payment" of Rs. 10,000/- as acknowledged under the said Agreement. The total contractual amount of rent payable by the petitioner to the respondent without aforesaid deduction was stipulated to be Rs. 150/- per month. The petitioner paid Rs. 75/- per month to the respondents as aforesaid till February, 1973. Since 1st March, 1973, the petitioner stopped paying rent to the respondents. (c) On 18th March, 1974, the respondents through their advocate issued a notice of demand to the petitioner calling upon the petitioner to pay arrears of rent for the period commencing from 1st March, 1973. By that time, the arrears of rent had accumulated for the period of one year. By the said notice, the respondents-landlords called upon the petitioner to pay the arrears of rent at the rate of Rs. 75/- per month, in view of the provision contained in the said agreement to permit deduction from the stipulated rent of Rs. 150/- per month as aforesaid. By reply letter dated 28th March, 1974, the petitioner contended that the petitioner was not liable to comply with the said notice in view of the balance of the said advance amount of Rs. 10,000/- still lying with the respondents. By the said reply, the petitioner contended that the entire balance of Rs. 10,000/- was liable to be adjusted against rent and no rent would be payable by the petitioner to the respondent till the entire balance was adjusted at the rate of Rs. 150/- per month. The petitioner thus contended that no rent was payable by the petitioner to the respondents till the entire balance of Rs. 10,000/- was exhausted and appropriated against the monthly rent of Rs. 150/-. The said notice of demand was a notice only for arrears of contractual rent as aforesaid. (d) By the end of July, 1975, the respondents filed a suit for eviction against the petitioner in the Court of Small Causes at Pune numbered as Regular Civil Suit No. 1885 of 1975. The respondents contended in the plaint in the said suit that the petitioner-tenant was not ready and willing to pay the rent and the petitioner had committed default in respect of his obligation to pay the rent by not complying with the above referred notice of demand dated 18th March, 1974. According to the respondents, the cause of action for suing for possession was complete on expiry of the said notice period of one month in view of the non-payment of the amount by the petitioner-tenant to the respondents, during the notice period. There was no dispute about standard rent between the parties. In the written statement filed in the said suit, the petitioner once again contended that the entire sum of Rs. 10,000/- was liable to be adjusted towards rent and that the petitioner-tenant was not liable to pay any amount towards rent until the balance of the said sum of Rs. 10,000/- was first appropriated. By the said written statement, the petitioner repudiated the contention of the respondents to the effect that the petitioner was liable to pay rent at the rate of Rs. 75/- per month and only Rs. 75/- per month was liable to be adjusted out of the advance of Rs. 10,000/- total monthly rent of the suit premises being Rs. 150/-. (e) In the plaint filed in the said suit, the respondents furnished particulars of claim in paragraph 4 thereof. In paragraph 4 of the plaint, the respondents contended that the petitioner was liable to pay arrears of rent at the rate of Rs. 150/- per month, which amount aggregated to Rs. 4,200/- for the period commencing from 1st March, 1973, upto 30th June, 1975. In the said paragraph of the plaint, the respondents also claimed a sum of Rs. 168/- on account of education cess payable by the respondents to the petitioner. In the abovereferred particulars of claim forming part of the plaint, the respondents gave credit for Rs. 2,100/- at the rate of Rs. 75/- per month in terms of the said agreement dated 2nd May, 1972. The respondents claimed decree for possession in respect of the suit premises as well as money decree for Rs. 2,372/- plus mesne profits. (f) The learned trial Judge dismissed the suit for eviction based on Section 12(3)(a) of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 ("the Bombay Rent Act", for short). In paragraph 14 of his judgment, the learned trial Judge observed that the sum of Rs. 10,000/- was advanced by the petitioner to the respondents before the commencement of the lease and in view of the said advance the petitioner was entitled to adjust the amount of the advance against rent under Section 18(2) of the Bombay Rent Act. The learned trial Judge held that the petitioner could not be held to be a defaulter because of his right to adjust the entire amount of advance against the amount of rent payable. (g) Being aggrieved by the said decree of dismissal of suit, the respondents in this petition filed Civil Appeal No. 642 of 1979. The Appellate Court reversed the decree of dismissal of the suit passed by the trial Court and passed a decree for possession against the petitioner on the footing that the petitioner had committed default by not paying the amount of arrears of rent for a period of more than six months and by not complying with the notice of demand dated 18th March, 1974. In paragraph 8 of its judgment, the appellate Court referred to Section 20 of the Bombay Rent Act and relied on the judgment of the Hon'ble Supreme Court in the case of Maganlal Chhotabhai Desai v. Chandrakant Motilal, AIR 1960 SC 37. The appellate Court held that Section 20 of the Bombay Rent Act prescribes limitation for recovery of the amount paid by the tenant to the landlords which was not in accordance with the provisions of the Bombay Rent Act. Section 20(1) of the Bombay Rent Act reads as under :- "20(1) Any amount paid on account of rent after the date of the coming into operation of this Act shall, except in so far as payment thereof is in accordance with the provisions of this Act, be recoverable by the tenant from the landlord to whom it was paid or on whose behalf it was received or from his legal representative at any time within a period of six months from the date of payment and may, without prejudice to any other remedy for recovery, be deducted by such tenant from any rent payable by him to such landlord." The appellate Court held that thus the tenant could recover refund of the excess amount paid from the landlord by filing a suit within a period of six months from the date of "unlawful payment" meaning thereby the payment not in conformity with the provisions of the Act. Section 20(1) of the Bombay Rent Act also provides that the tenant may deduct amount of such excess payment from the rent payable by him to such landlord, apart from his remedy of filing the suit for refund. In the above-referred judgment of the Hon'ble Supreme Court, it was held by the Apex Court that the right of the tenant to recover "the overpaid amount for the amount paid not in accordance with the conformity of the provisions of the said Act or the right to make deduction of such amount from the rent must necessarily be exercised within a period of six months from the date of payment inasmuch as deduction was also one mode of recovery." Section 18 of the Bombay Rent Act prohibits the landlord from accepting the construction loan or advance payment from the tenant on that account except under a registered agreement, which agreement must stipulate the conditions enumerated in Section 18(3) of the Bombay Rent Act. In the instant case, the agreement dated 2nd May, 1972 is not a registered agreement and the said agreement did not stipulate the conditions prescribed under Section 18(3) of the Bombay Rent Act. In other words, the appellate Court took the view that the remedy of the petitioner tenant to seek adjustment for Rs. 10,000/- against his liability to pay the rent of Rs. 150/- per month had become barred by law of limitation on expiry of six months from 2nd May, 1972 and there was no merit in the plea of the petitioner seeking to deduct entire balance of Rs. 10,000/- from the rent payable from 1st March, 1973 till the same was exhausted. The Court held that the tenant had failed and neglected to pay the arrears of rent within the notice period and the notice issued was a valid notice. The Court held that Section 12(3)(a) of the Act was attracted to the facts of the case. In the result, the appellate Court passed decree for eviction against the petitioner.
(3.) IT is not disputed and it is not reasonably disputable that the petitioner-tenant had not paid rent to the respondents-landlords for the period commencing from 1st March, 1973 and the arrears of rent had accumulated for a period of one year on the date of notice dated 18th March, 1974. It is not disputed, and it is not reasonably disputable that amount claimed by the said notice was not paid. The petitioner was in arrears of rent for more than six months. The only question which arises for consideration of the Court is regarding plea to adjust balance of Rs. 10,000/- against the rent. The plea of adjustment of balance of Rs. 10,000/- can possibly be examined from two different angles. According to the respondents, case supported by the said agreement dated 2nd May, 1972, the petitioner was liable to pay amount of rent at the rate of 75/- per month during the said period, i.e. at the rate of Rs. 150/- per month, as gross rent and adjust part of such rent against the advance paid as provided under the said agreement. The petitioner paid the amount of rent to the landlord at the rate of Rs. 75/- per month for the period commencing from May, 1972 till February, 1973. Since the petitioner did not pay the amount of arrears of rent in compliance with the notice of demand the only question which arises is whether the said amount of arrears of rent was adjustable in law in full on the date of notice of demand. If one has to decide the matter in the light of the agreement dated 2nd May, 1972, the petitioner was obviously in default. It is, however, obvious that the said agreement dated 2nd May, 1972 shall have to be ignored as the said sum of Rs. 10,000/- was received by the respondents from the petitioner not in conformity with the provisions of the Bombay Rent Act, i.e. as a construction loan under a registered agreement stipulating the statutory conditions. The tenant, therefore, had a right to claim the entire sum of Rs. 10,000/- in one lump sum by filing a suit within a period of six months from the date of the payment or by deducting the said sum from rent within a period of six months from the date of payment. The remedy of the petitioner to file a suit for recovery of the said sum of Rs. 10,000/- or balance thereof or to recover the same as and by way of deduction from rent was time barred on expiry of six months from 2nd May, 1972. The judgment of the Hon'ble Supreme Court in the case of Manganlal Chhotabhai Desai v. Chandrakani Motilal, 1969 RCR 217 (SC) (supra) is quite clear on the subject. In this case, Bachawat, J., speaking for the Bench of the Hon'ble Supreme Court, observed that if the amount was incapable of recover because of bar of limitation, it could not be recovered by deduction and the right of recovery by deduction was barred at the same time as the right to recovery by suit. It was observed by the Apex Court that if the tenant sought recovery of the overpaid amount or the amount paid to the landlord not in accordance with the conformity of the provision contained in the Bombay Rent Act, he must bring the suit or make deductions within six months from the date of payment. The Hon'ble Supreme Court approved the dictum of the judgment of our High Court in the case of Karamasy Kanji v. Volji Virji, 56 Bom. LR 619. The learned Counsel for the respondents has also invited my attention to the subsequent judgment of the Hon'ble Supreme Court in the case of Jamnadas Harakchand and others v. Narayanlal Bansilal and others, 1970 RCR 244 : AIR 1970 SC 1221. The learned Counsel for the petitioner has submitted for the first time at the Bar that the period of limitation for adjustment of the amount of balance of Rs. 10,000/- against the rent of Rs. 150/- per month, payable every month, is deemed to have been extended in this case under Articles 18 and 19 of the Limitation Act, 1963. The learned Counsel for the petitioner has contended that the respondents were bound to adjust the entire amount of claim of Rs. 150/- per month against the balance of advance of Rs. 10,000/- and thus no amount was due and payable by the petitioner to the respondent on account of rent during the notice period or even thereafter. It is not possible to accept either of these submissions urged on behalf of the petitioner. The learned Counsel for the petitioner has invited attention of the Court to the averments made in the plaint in Suit No. 1885 of 1975. The learned Counsel has submitted that the respondents have given credit to the petitioner while computing the balance of the outstanding rent at the rate of Rs. 75/- per month and thus giving the cause of action for recovery of possession under Section 12(3)(a) of the Bombay Rent Act must be treated as non-existent by reason of the aforesaid credit. The petitioner did not seek adjustment of the amount of advance at the rate of Rs. 75/- per month but wanted the entire amount to be adjusted without reference to the instalments fixed under the agreement. This was the plea of the petitioner in reply to the notice and in the written statement. The remedy of the petitioner tenant to seek such adjustment was barred by limitation on expiry of six months from 2nd May, 1972. The said remedy was co extensive with the period of limitation prescribed for filing of the suit for refund. The respondents never acknowledged liability to adjust the entire amount at any time as argued on behalf of the petitioner. The petitioner cannot approbate and reprobate. Either the petitioner accepted the agreement dated 2nd May, 1972 or the petitioner does not. If the agreement is to be worked out, the petitioner was in default as the petitioner had not paid arrears of rent at the stipulated rate for one year at the time when the notice was issued. If the agreement is to be ignored and the rights of the tenant are to be worked out, the petitioner was in default, as the petitioner had not paid arrears of rent at the stipulated rate for one year at the time when the notice was issued. If the agreement is to be ignored and the rights of the tenant are to be worked out with reference to Sections 18 and 20 of the Bombay Rent Act, such rights must necessarily be exercised within a period of six months from the date of payment. The consistent conduct of the respondents in claiming rent at the rate of Rs. 75/- per month for the relevant period cannot be construed as "part-payment" by the respondents so as to extinguish the cause of action for possession accrued in favour of the respondents on expiry of notice period. The learned Counsel for the petitioner has relied upon the Explanation to Section 18 of the Limitation Act, 1963. With respect, the Explanation is totally irrelevant for our purpose. The question to be asked is what did the respondents acknowledge in the plaint or in the deposition ? The question can be answered only by posing another question as to what was the claim of the petitioner. The claim of the petitioner in reply to the notice demand as well as in the written statement was that the respondents were bound to give credit for the entire sum of Rs. 1,000/- without reference to any instalments and the petitioner was not liable to pay any rent, at any rate, till the said amount was adjusted in full i.e. for a period of about eight years. The respondents never acknowledged this claim of the petitioner at any time. The conduct of the respondents in giving credit at the rate of Rs. 75/- per month only cannot be interpreted to mean implied acknowledgment of liability in respect of the claim to adjust entire amount as put forward by the petitioner. The case of the respondents throughout was that the petitioner was liable to pay rent at the rate of Rs. 75/- per month till the amount of advance was adjusted. The respondents never agreed not to claim any rent till advance was adjusted. The petitioner did not pay the amount of rent at the rate of Rs. 75/- per month during the notice period. With respect, the argument urged appears to be rather confussing. No such plea was taken in the Courts below. There is no merit. Part payment or acknowledgement by the letter extends limitation for filing of a suit by the creditor. None of these provisions are applicable in this case. The remedy of the petitioner to deduct the entire sum of Rs. 10,000/- in one lump sum or balance thereof had already become barred by law of limitation and the said time-barred claim was not revived by reason of the respondents making claim for arrears of rent at the rate of Rs. 75/- per month during the notice period or during the pendency of the suit.;