State Bank of India vs. Prasanna Kumari and Others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR.JUSTICE K.HARILAL** **&** **THE HONOURABLE MR. JUSTICE R. NARAYANA PISHARADI** **FRIDAY ,THE 25TH DAY OF JANUARY 2019 / 5TH MAGHA, 1940** **RCRev..No. 6 of 2017** **AGAINST THE JUDGMENT IN RCP NO.75/2011 of RENT CONTROL COURT, THIRUVANANTHAPURAM DATED 12-01-2014** **AGAINST THE JUDGMENT IN RCA NO.40/2014 ON THE FILE OF THE RENT CONTROL APPELLATE AUTHORITY-IV, ADDITIONAL DISTRICT COURT - IV, THIRUVANANTHAPURAM DATED 22-07-2016** ## **REVISION PETITIONER/APPELLANT/COUNTER PETITIONER:** > AMENDED AS STATE BANK OF INDIA STATE BANK OF TRAVANCORE** **A BODY CORPORATE ESTABLISHED UNDER THE STATE BANK OF INDIA (SUBSIDIARY BANKERS) ACT, 1959 AND HAVING ITS BRANCH AT AKKULAM, THIRUVANANTHAPURAM** **BY ADVS. SRI.R.S.KALKURA SRI.HARISH GOPINATH SRI.M.S.KALESH** ** **THE NAME OF STATE BANK OF TRAVANCORE IS AMENDED AS STATE BANK OF INDIA UNDER THE PROVISIONS OF THE STATE BANK OF INDIA ACT, 1955 VIDE ORDER DATED 2.11.2017 IN I.A NO. 2801/2017.** **RESPONDENTS/RESPONDENTS 2 TO 4/LEGAL HEIRS OF THE PETITIONER:** **1 PRASANNA KUMARI AGED 60 YEARS, W/O. LATE SASIDHARAN,TC 6/2034, AMBADI BUILDING CHERUVACKAL VILLAGE,PULAYANARKOTTA THURUVICKAL PO., THIRUVANANTHAPURAM PIN-695001** **RCRev..No. 6 of 2017** **2** **2 S. SANTHOSH KUMAR AGED 52 YEARS, TC.6/2034,AMBADI BUILDING CHERUVACKAL VILLAGE, PULAYANARKOTTA THURUVICKAL PO., THIRUVANANTHAPURAM PIN-695001** **3 SALINI. D/O. PRASANNA KUMARI, AGED 50 YEARS,TC 6/2034,AMBADI BUILDING CHERUVACKAL VILLAGE, PULAYANARKOTTA THURUVICKAL PO., THIRUVANANTHAPURAM PIN-695001** **ADDL.R4 IMPLEADED** ***ADDL.R4SYAMKUMAR .S T.C 6/20, AMBADY THURUVICKAL P.O. PULAYANARKOTTA – 695 031. BY ADVS. SRI.M.R.ANANDAKUTTAN SMT.M.A.ZOHRA SRI.C.P.ABHILASH SRI.MAHESH ANANDAKUTTAN** *** ADDL.R4 IS IMPLEADED VIDE ORDER DATED 2.11.2017 IN I.A 2800/2017.** **THIS RENT CONTROL REVISION HAVING BEEN FINALLY HEARD ON 25.01.2019, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** **RCRev..No. 6 of 2017** **3** ## **'C.R'** ## K. HARILAL & R NARAYANA PISHARADI,JJ. = = = = = = = = = = = = = = = = = = = = = = ## R.C.R No. 6 of 2017 - - - - - - -- - - - - - - - - - - - - - - - – - - - - Dated this the 25[th] day of January, 2019 ## O R D E R ## **K. HARILAL, J.** The revision petitioner is the tenant against whom the respondent/landlord had filed RCP No. 75/2011, before the Rent Control Court, Thiruvananthapuram seeking an order fixing the fair rent of the petition schedule building owned by him and occupied by the revision petitioner (the parties shall be hereinafter referred to as they figure in the Rent Control Petition). 2. According to the petitioner, the tenancy commenced on 08.12.2000 and the respondent is in occupation of an area **RCRev..No. 6 of 2017** **4** having an extent of 2500 square feet. As per the lease deed, the rent was fixed at the rate of Rs.4.25/- square feet. Subsequently, as per the terms of the agreement on 03.04.2009, the respondent agreed to revise the rent at the rate of 25% every five year. The present rate of rent is Rs.6.25/- per square feet. According to the petitioner, the present rate of rent is far below the rate of rent prevailing in the locality for similar buildings. Hence, the petitioner prayed for an order fixing the fair rent of the building at the rate of Rs.20/- per square feet. 3. The respondent resisted the claim for enhancement of rent contending that there is no need for fixing fair rent as there is specific provision in the rent deed requiring revision of rent on completion of every five years. The rent was revised on two occasions as per the terms of agreement and the present **RCRev..No. 6 of 2017** **5** rate of rent is Rs.15,616/-, that is, Rs.6.25/- per square feet. So, the demand for rent at the rate of Rs.20/- per square feet is exorbitant and unreasonable. Where the rent deed itself contains provision for periodical enhancement of rent at a specified rate, the Rent Control Petition seeking enhanced rent, at a rate more than the specified rate, is not maintainable. 4. On the rival pleadings, both parties went on to trial. After considering the evidence on record, the Rent Control Court enhanced the present rent and fixed the fair rent at the rate of Rs.7.80/- per square feet. In appeal, the Appellate Authority affirmed the said order passed by the Rent Control Court. The legality and propriety of the order, fixing the fair rent of the petition schedule building at Rs.7.80/- per square feet, are assailed in this revision petition. 5. Heard the learned counsel for the petitioner and the **RCRev..No. 6 of 2017** **6** learned counsel for the respondents. 6. Learned counsel for the petitioner highlighted the point that there cannot be an enhancement during the period of an agreement wherein there is a specific clause providing for periodical enhancement at a specified rate. In order to substantiate the said contention, learned counsel for the petitioner cited the decision of the Honourable Supreme Court in Mohammad Ahmad v. Atma Ram Chauhan [AIR 2011 SC 1940]. Learned counsel drew our attention to clauses (i) and (v) in paragraph 21 of the aforesaid decision. According to the learned counsel, in the instant case, by the lease agreement dated 03.04.2009, periodical enhancement of rent was made at the rate of 25% on every five years. Learned counsel has contended that the present rent control petition seeking further enhancement of rent, more than at the said specified rate, is **RCRev..No. 6 of 2017** **7** not maintainable. Secondly, learned counsel vehemently contended that the court below went wrong by fixing fair rent on the basis of the variations in the money value and cost of living caused by inflation, without proof of the same. According to the learned counsel, inflation is not a judicially noticeable fact under Section 57 of the Indian Evidence Act. 7. Per contra, learned counsel for the respondent advanced the argument that neither any of the provisions under the Rent Control Act nor clauses (i) and (v) in paragraph 21 of the decision in the Mohammad Ahmad's case (supra) would preclude the landlord from filing a rent control petition, invoking Section 5(1) of the Kerala Building (Lease and Rent Control) Act, 1965 (hereinafter referred to as 'the Act'). According to the learned counsel, the aforesaid decision does not provide an immunity to the tenant against the filing of rent **RCRev..No. 6 of 2017** **8** control petition against him invoking Section 5(1) of the Act even if the landlord and the tenant have fixed the rent with periodical enhancement, in the lease agreement itself. 8. In view of the arguments at bar, the first question that emerges for consideration in this revision petition is whether an agreement between the landlord and the tenant stipulating periodical enhancement of rent or the guidelines enumerated in the decision of the Honourable Supreme Court in Mohammad Ahmad's case (supra) would preclude the landlord from instituting a rent control petition under Section 5(1) of the Act seeking fixation of fair rent at a rate more than the specified rate of enhancement provided in the lease agreement. It is not disputed that, even in the original rent deed dated 08.12.2000, there was a provision for periodical enhancement of rent and the original rent at the rate of **RCRev..No. 6 of 2017** **9** Rs.4.25/- per square feet was subsequently enhanced and fixed at Rs.12,493/-. Thereafter, the original lease agreement was renewed by a renewal agreement dated 03.04.2009 and as per that agreement, the petitioner and the respondent agreed to enhance the rent at the rate of 25% on every five year. It is also to be noted that the present rent control petition was filed on 14.11.2011. 9. On a survey of various provisions under the Act, we find that there is no provision prohibiting institution of a rent control petition, where there is an agreement between the landlord and tenant for periodical enhancement of rent during the period of the lease deed. On the other hand, we find that according to Section 11(9) of the Act, where the tenancy is for a specified period agreed upon between the landlord and the tenant, the landlord shall not be entitled to apply to the Rent **RCRev..No. 6 of 2017** **10** Control Court for eviction of the tenant before the expiry of such period. In the above view, we are of the opinion that, the legislature was so conscious to omit such a bar against institution of rent control petition seeking fixation of fair rent even if there is an agreement between the landlord and the tenant fixing the rent with provision for periodical enhancement. The absence of such a statutory bar gives rise to an inference that the legislature has consciously permitted the landlord to approach the Rent Control Court to get the fair rent determined, notwithstanding the stipulation regarding periodical enhancement in the lease agreement. Therefore, it can be concluded that an agreement fixing the rent with periodical enhancement, at a specified rate, between the landlord and tenant, will not preclude the landlord from instituting a rent control petition invoking Section 5(1) of the **RCRev..No. 6 of 2017** **11** Act, for fixation of fair rent. 10. Secondly, we have meticulously gone through clauses (i) and (v) in paragraph 21 of the decision in Mohammad Ahmad's case (supra). Clauses (i) and (v) in paragraph 21 of the aforesaid decision are extracted below: “(i). The tenant must enhance the rent according to the terms of the agreement or at least by ten percent, after every three years and enhanced rent should then be made payable to the landlord. If the rent is too low (in comparison to market rent), having been fixed almost 20 to 25 years back then the present market rate should be worked out either on the basis of valuation report or reliable estimates of building rentals in the surrounding areas, let out on rent recently. (ii)..... (iii)..... **RCRev..No. 6 of 2017** **12** (iv)..... (v)If present and prevalent market rent assessed and fixed between the parties is paid by the tenant then landlord shall not be entitled to bring any action for his eviction against such a tenant at least for a period of 5 years. Thus for a period of 5 years the tenant shall enjoy immunity from being evicted from the premises.” 11. On a meticulous reading of clause (i), we find that even though the Supreme Court has held that the tenant must enhance the rent according to the terms of the agreement or atleast by 10% after every three years, the said enhancement does not preclude the landlord from invoking the statutory provision for fixing the fair rent at a rate higher than the rate of rent in the agreement or more than 10%. In the aforesaid decision, it is specifically stated that the guidelines are only **RCRev..No. 6 of 2017** **13** illustrative and not exhaustive, to minimise litigation between the landlord and the tenant. It is not a bar against institution of rent control petition seeking fixation of fair rent. Therefore, we find that clause (i) in paragraph 21 of the decision in Mohammed Ahmad's case (supra) will not preclude the landlord from seeking fixation of fair rent at a rate more than the specified rate at which periodical enhancement is stipulated in the agreement between the landlord and the tenant. 12. Coming to clause(v) in paragraph 21 of the decision referred to above, we find that as per the said clause, the landlord is precluded from bringing any action for the eviction of the tenant at least for a period of five years if the present and prevalent market rent assessed and fixed between the parties is paid by the tenant. There is no immunity in favour of the tenant from the landlord instituting a rent control petition **RCRev..No. 6 of 2017** **14** seeking fixation of fair rent, even if the landlord and the tenant had fixed the rent with periodical enhancement at a specified rate in the lease agreement or renewal agreement. 13. In the above view, we find that the decision in Mohammad Ahmad's case (supra) will not preclude the landlord from instituting a rent control petition seeking fixation of fair rent at a rate more than the agreed rent or the rent enhanced periodically as stipulated in the lease deed. 14. The next point to be considered is whether there is illegality or impropriety in fixation of the fair rent on the basis of inflation, without production of strict proof, by taking judicial notice. In Edger Ferus v. Abraham Ittycheria (2004 (1) KLT 767), this Court has held as follows: “Rent Control Court while fixing fair rent could take note of the inflation and resultant **RCRev..No. 6 of 2017** **15** reduction in the purchasing power of money, variations in the cost of living index in the area since commencement of the lease, demand for accommodation and availability of the buildings in the locality.” 15. What is meant by the expression "facts judicially noticeable" envisaged under Section 56 of the Indian Evidence Act, 1872? 16. The general law envisaged under Section 101 of the Indian Evidence Act is that whoever desires any court to give judgment as to any legal right or liability dependent on the existence of facts, which he asserts, must prove that those facts exist. In other words, the parties to the lis must prove all the disputed facts in issue and the relevant facts by the production of evidence, either oral or documentary. But Sections 56 and 58 of the Indian Evidence Act provide two **RCRev..No. 6 of 2017** **16** exceptions to the said general rule. Section 56 provides that "facts judicially noticeable" need not be proved. Section 58 states that "facts admitted need not be proved". Thus, Sections 56 and 58 are exceptions to Section 101 of the Indian Evidence Act. According to Section 56, no fact of which the court will take judicial notice need to be proved. 17. Section 57 of the Indian Evidence Act enumerates the facts of which the court shall take judicial notice. General belief in the existence of facts dealt within Section 56 is induced by the general knowledge acquired otherwise than in suit or proceedings and independently of the evidence adduced by the parties. It is to be borne in mind that the scope and extent of Section 56 is not confined to Section 57 and Section 57 directs that the court shall take judicial notice of the facts referred to in clauses (1) to (13) therein. Section 57 does not **RCRev..No. 6 of 2017** **17** intend or mean that judicial notice of facts, other than the facts enumerated under clauses (1) to (13), cannot be taken. The court can take judicial notice of the facts outside the scope of Section 57. But, the difference is that the court has no discretion to take cognizance in respect of the facts enumerated under clauses (1) to (13) of Section 57 and the court shall take judicial notice of the same. But the court has wide discretion to take cognizance of facts, other than the facts specifically enumerated under clauses (1) to (13) of Section 57. 18. Thus, a "judicially noticeable fact" is a fact in respect of which the court can take cognizance from undisputed common knowledge, without proof of its existence as true, on convenience and expediency in the cause of justice, without production of strict proof by the parties to the lis, as required under Section 101 of the Indian Evidence Act. **RCRev..No. 6 of 2017** **18** 19. The above view is supported by judicial precedents. ## In Onkar Nath v. Delhi Administration : AIR 1977 SC 1108 , the Apex Court has held as follows: 1. “Section 56 of the Evidence Act provides that no fact of which the Court will take judicial notice need be proved. Section 57 enumerates facts of which the Court "shall" take judicial notice and states that on all matters of public history, literature, science or art the Court may resort for its aid to appropriate books or documents of reference. The list of facts mentioned in Section 57 of which the Court can take judicial notice is not exhaustive and indeed the purpose of the section is to provide that the Court shall take judicial notice of certain facts rather than exhaust the category of facts of which the Court may in appropriate cases take judicial notice. Recognition of facts without formal proof is a matter of expediency and no one has **RCRev..No. 6 of 2017** **19** ever questioned the need and wisdom of accepting the existence of matters which are unquestionably within public knowledge. Shutting the judicial eye to the existence of such facts and matters is in a sense an insult to commonsense and would tend to reduce the judicial process to a meaningless and wasteful ritual. No Court therefore insists on formal proof, by evidence, of notorious facts of history, past or present. ................... Judicial notice, in such matters, takes the place of proof and is of equal force. In fact, as a means of establishing notorious and widely ” known facts it is superior to formal means of proof . (emphasis supplied). 20. In Kamani Metals & Alloys Ltd. v. The Workmen [AIR 1967 SC 1175], the Supreme Court has held that steep increase of the price of commodities and consequential requirement for revision of the wages of the labourers is a judicially noticeable **RCRev..No. 6 of 2017** **20** fact. In Bharat Petroleum (Erstwhile Burmah Shell) Management Staff Pensioners v. Bharat Petroleum Corporation Ltd. [AIR 1988 SC 1407] , the Supreme Court has held that judicial notice can be taken of the fact that rupee has lost its value to a considerable extent. In Rattan Arya v. State of T.N. [AIR 1986 SC 1444] , the Supreme Court has held that court can take judicial notice of enormous multifold increase of rents throughout the country, particularly in urban area. 21. In the instant case, the last revision of rent was in the year 2009 and the rent was Rs.6.25/- per square feet. The Rent Control Court fixed the rent on 12.2.2014 with effect from 13.11.2011. It follows that two years had elapsed after the last revision of rent. The courts below have concurrently fixed the fair rent at the rate of Rs.7.80/- per square feet. Considering the reduction in purchasing power of money and variation in **RCRev..No. 6 of 2017** **21** the cost of living index caused by inflation since the commencement of lease, the Rent Control Court has added Rs.1.55/- per square feet only to the existing rent. We are of the opinion that, the said enhancement is just and reasonable, and it warrants no interference under revisional jurisdiction. Consequently, the revision fails and the petition is dismissed. No costs. Sd/-K. HARILAL, JUDGE Sd/-R NARAYANA PISHARADI, JUDGE lsn