1971 (4) TMI 108 - HC - Indian Laws

Summary

Issues Involved:
1. Conviction under Section 18(4) of the Bombay Rent Act, 1947.
2. Contravention of the provisions of Section 18(3) of the Bombay Rent Act, 1947.
3. Interpretation of Section 18 of the Bombay Rent Act, 1947.
4. Failure to register the agreement.
5. Failure to create a charge on the building and land.
6. Failure to complete the building within the stipulated period.

Issue-wise Analysis:

1. Conviction under Section 18(4) of the Bombay Rent Act, 1947:
The accused, a former landlord, was convicted under Section 18(4) for contravening Section 18(3), though acquitted of the offence under Section 18(1). The trial court sentenced him to a fine of Rs. 500. The accused appealed against this conviction.

2. Contravention of the provisions of Section 18(3) of the Bombay Rent Act, 1947:
The prosecution alleged three breaches under Section 18(3):
1) Failure to register the agreement dated 16th September 1966.
2) Failure to create a charge on the building and the land.
3) Failure to complete the building within two years from the date of the agreement.

3. Interpretation of Section 18 of the Bombay Rent Act, 1947:
Sub-section (3) of Section 18 was argued to be a substantive provision itself, not merely a proviso to sub-section (1). The court held that sub-section (3) deals with agreements to grant a lease and must be construed as a substantive provision, incorporating its conditions by operation of law in all construction loan agreements.

4. Failure to register the agreement:
The agreement between the complainant and the accused was not registered as required by Section 18(3). The court found that the accused had no reasonable excuse for this failure, constituting a breach of sub-section (3) and an offence under sub-section (4).

5. Failure to create a charge on the building and land:
The court held that the conditions of sub-section (3) are incorporated by law in all construction loan agreements. Thus, the failure to expressly provide for a charge on the building and land did not constitute an offence, as the statutory incorporation suffices.

6. Failure to complete the building within the stipulated period:
The building was not completed within the statutory two-year period from the agreement date. The court found clear evidence of this breach, with no reasonable excuse provided by the accused. This constituted another offence under sub-section (4).

Judgment:
The court upheld the conviction under Section 18(4) for the failure to register the agreement and complete the building within the statutory period. However, it did not uphold the conviction for failing to create a charge on the building and land. The sentence was reduced to a fine of Rs. 100, with simple imprisonment for one month in default of payment. The appeal was dismissed.