1965 (3) TMI 112 - SC - Indian Laws

Summary

Issues Involved:
1. Adequacy of rent deposits under Section 13 of the East Punjab Urban Rent Restriction Act, 1949.
2. Relief against forfeiture.
3. Determination of the commencement of title for the auction-purchased property.
4. Applicability of the ruling in Bombay Salt and Chemical Industries v. L. J. Johnson, AIR 1958 SC 289.

Issue-wise Detailed Analysis:

1. Adequacy of Rent Deposits Under Section 13 of the East Punjab Urban Rent Restriction Act, 1949:
The appellant, a tenant, was ordered to be evicted by the Rent Controller, Ludhiana, because the rent deposits made by him were not adequate under Section 13 of the East Punjab Urban Rent Restriction Act, 1949. The appellant had entered into possession in 1944 with a monthly rent of Rs. 12. The property was auctioned and purchased by the respondent, and the appellant was informed to pay rent to the respondent from October 3, 1956. The appellant alleged that he had tendered rent at Rs. 12 per month, which the respondent refused, demanding Rs. 20 per month instead. The appellant deposited Rs. 240 and Rs. 144 in court for 32 months from October 30, 1956, to June 30, 1959. The Rent Controller held that the standard rent was Rs. 12, but the deposits were short by Rs. 4-12-0, thus ordering eviction. The Appellate Authority and the High Court upheld this decision.

2. Relief Against Forfeiture:
The appellant sought relief against forfeiture, arguing that the tenancy commenced on December 4, 1956, when the sale certificate was issued, and not on October 3, 1956. The Appellate Authority rejected this contention, holding that the appellant had paid Rs. 1.19 to the Custodian for the first two days of October and accepted the respondent as his landlord from October 3, 1956. The appellant was thus estopped under Section 116 of the Indian Evidence Act from denying the respondent's title between October 3 and December 4, 1956. The High Court also dismissed the revision petition, holding that the title passed to the auction-purchaser on the confirmation of the sale and not when the sale certificate was issued.

3. Determination of the Commencement of Title for the Auction-Purchased Property:
The Supreme Court examined the rules under the Displaced Persons (Compensation and Rehabilitation) Act, 1954, and the corresponding rules. The rules did not clearly indicate the point of time from which the title of the auction-purchaser commences. The Court noted that the passing of title presupposes the payment of the full price. The stages in the sale of property include the fall of the hammer, approval of the highest bid, payment of the full price, grant of the certificate, and registration of the certificate. The Court held that title passes when the full price is realized and not necessarily when the certificate is issued. In this case, the full price was paid before the sale was confirmed, and the tenant was informed to attorn to the purchaser from the date of confirmation of the sale, thus title passed on the confirmation date.

4. Applicability of the Ruling in Bombay Salt and Chemical Industries v. L. J. Johnson, AIR 1958 SC 289:
The appellant contended that the High Court erred in not following the ruling in Bombay Salt and Chemical Industries v. L. J. Johnson, AIR 1958 SC 289. The Supreme Court clarified that the earlier ruling did not decide the precise point regarding the commencement of title. The Court in the present case distinguished the earlier ruling, stating that the decision in Bombay Salt and Chemical Industries was based on the lack of proof of full payment and the absence of a sale certificate. The present case involved the full payment of the purchase price before the confirmation of the sale, and the tenant had acknowledged the new landlord from October 3, 1956. Thus, the ruling in Bombay Salt and Chemical Industries was not applicable.

Conclusion:
The Supreme Court upheld the eviction order, holding that the deposits made by the appellant were inadequate under Section 13 of the East Punjab Urban Rent Restriction Act, 1949. The Court also held that the title passed to the respondent on the confirmation of the sale, and the appellant was estopped from denying the respondent's title. The Court dismissed the appeal, granting the appellant three months to hand over possession, and made no order as to costs.