1962 (4) TMI 128 - HC - Indian Laws

Summary

Issues Involved:
1. Basis of rent fixation under Section 16(3) of the West Bengal Premises Tenancy Act.
2. Applicability of Section 8(1)(e) and its proviso in rent fixation.
3. Methodology for determining fair rent for sub-tenants upgraded to direct tenants.
4. Legal implications of deeming provisions in rent fixation.

Detailed Analysis:

1. Basis of Rent Fixation under Section 16(3):

The primary issue revolves around the proper basis for fixing the rent payable by the tenant and sub-tenants under Section 16(3) of the West Bengal Premises Tenancy Act. The court noted that the Controller's duty is to fix rents for each of the new premises created by the sub-letting. The rents so fixed are deemed to be fair rents for the purposes of the Act. The court emphasized that the Controller must fix rents in accordance with the principles embodied in the main part of Section 8(1)(e), which involves considering the situation, locality, condition, and amenities of the premises, as well as the rent payable for similar premises in the locality.

2. Applicability of Section 8(1)(e) and its Proviso:

The court analyzed whether the proviso to Section 8(1)(e), which limits rent increases to ten percent over the existing rent, applies to rent fixation under Section 16(3). It was held that the proviso to Section 8(1)(e) does not apply because the premises in question, created by the order under Section 16(3), have no existing rents. The court clarified that the Controller is not required to fix the rent of the premises originally let to the tenant but to fix the rents of the new premises independently.

3. Methodology for Determining Fair Rent:

The court rejected the contention that the Controller should first determine the fair rent for the entire premises and then apportion it among the tenant and sub-tenants. Instead, it held that the Controller's function is to fix the rents payable by the tenant and sub-tenants for the newly created tenancies. The court reaffirmed that the rent should be fixed based on the principles of reasonableness, considering the situation, locality, and condition of the premises and the amenities provided.

4. Legal Implications of Deeming Provisions:

The court elaborated on the legal implications of the deeming provision in Section 16(3), which states that the rents fixed by the Controller shall be deemed to be fair rents. It emphasized that a deeming provision postulates treating an imaginary state of affairs as real, and thus, the rents fixed under Section 16(3) are to be considered fair rents for all purposes under the Act, even if they do not strictly comply with the definition of fair rent under Section 8.

Separate Judgments:

Judgment by D.N. Sinha, J.:

Sinha, J. provided a detailed factual background and discussed the methodology adopted by the Rent Controller in fixing the rents. He agreed with the Appellate Tribunal's decision to increase the rent payable by the tenant from Rs. 16 to Rs. 102.3 nP per month, emphasizing that the rent should be fixed based on the average rent paid by other tenants in the locality. He also noted that the proviso to Section 8(1)(e) does not apply to the new premises created under Section 16(3).

Judgment by P.N. Mookerjee, J.:

Mookerjee, J. concurred with the view that the proviso to Section 8(1)(e) does not apply to the new premises created under Section 16(3). He emphasized that the rent fixed under Section 16(3) is deemed to be fair rent and should be determined independently of Section 8(1). He agreed with the Appellate Tribunal's decision and affirmed the order fixing the rent at Rs. 102.3 nP per month for the tenant's retained portion.

Conclusion:

The court concluded that the rule should be discharged, and the Appellate Tribunal's order should be upheld. The rents fixed by the Controller under Section 16(3) are deemed to be fair rents for the purposes of the Act, and the proviso to Section 8(1)(e) does not apply to the new premises created by the sub-letting. The court's decision provides clarity on the methodology for rent fixation under Section 16(3) and the applicability of the deeming provision in the West Bengal Premises Tenancy Act.