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TMI Blog1964 (1) TMI 52X X X X Extracts X X X X X X X X Extracts X X X X ..... se, shows that the premises were taken on a monthly tent of ₹ 300. The memorandum also contains other terms which need not be mentioned here, because they are not relevant to the present appeal. It appears that Seth Kirori Mal was in arrears in payment of his income-tax, and a sum of ₹ 39,00,000 was outstanding from him. On October 31, 1957, the Income-tax Officer Central Circle, New Delhi, to whom all cases of Seth Kirori Mal were transferred, issued a notice to the appellant under s. 46(5A) of the Indian Income-fax Act directing him to deposit with the Income-tax Officer all sums due by way of rent as also future rents. The appellant sent no reply to this notice. He had, however,on September 29, 1957, addressed a letter to the respondent Seth Kirori Mal. The reply of Kirori Mal, dated October 15, 1957, figured in the arguments a great deal, and as it is brief, it may be quoted here: "From TO Dated Faigarh, the 15th October, 1957, Dear Sir, With reference to letter No. M-17-58, dated 29th September, 1957, 1 am to write that you may please adjust six months rent of 43, Prithviraj Road, New Delhi, i.e., ₹ 1800 (rent from 1-10-57 to 31-3-1958) towards your prof ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... statement of fees -amounting to ₹ 23,500 which he had submitted to his ,client on February 4, 1959. The Official Receiver then in- formed the appellant that the party concerned had denied the claim for fees as absolutely false, and observed in his letter that the professional fees should be the subject of -some other proceeding but the rent should be paid with,out delay. He enquired if the amount of rent had been paid 'to the Income-tax department in response to the notice. In his reply to this letter, on July 5, 1960, the appellant for the first time stated that there was an agreement between him and Seth Kirori Mal to adjust the rent towards his professional fees until the fees were fully paid. He offered -to reduce the fees if Seth Kirori Mal had any objection, but stated that till the professional fees were recouped, no rent could be considered to be due from him. On November 25, 1960, Seth Kirori Mal applied to the High Court at Calcutta for directions to the Official Receiver to take appropriate proceedings to realise the arrears of rent from the appellant, and on December 19, 1960, the High Court appointed Seth Kirori Mal receiver in the case. Seth Kirori Mal th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oller also said that if in the enquiry to be subsequently made, the tenant proved that the amount of fees had to be recouped from rent. the amount would not be paid to Kirori Mal. Against the decision of the Rent Controller, the appellant filed an appeal before the Rent Control Tribunal. The Rent Control Tribunal affirmed the decision of the Controller, observing that the plea taken by him that his professional fees were to come out of rent was an after-thought and there was no evidence to prove that there was such an agreement between the parties. On other matters, the Tribunal expressed its agreement with the Rent Controller. The appellant then appealed to the High Court of Punjab. The High Court upheld the orders so far made and pointed out that in the letter dated July 19, 1958, to the Receiver, the appellant had not mentioned the agreement. The High Court hi-,Id that the order made under s. 15(1) of the Act was proper, because it was an admitted fact that rent had not been paid to anybody from April 1, 1958. The High Court endorsed the view of the Tribunals below that the notice of the Income-tax Officer did not come in the way of making the deposit of the rent in the office ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hearing and his plea that there was an agreement between the parties that the rent as and when it fell due should be set off against the professional fees, would remain untried. In our opinion, this reading is not permissible. Section 15 (omitting such parts as are unnecessary for the present purpose) reads as follows: Section 15. (1) In every proceeding for the recovery of possession of any premises on the ground specified in clause (a) of the proviso to subsection (1) of section 14, the Controller shall, after giving the parties an opportunity of being heard, the an order directing the tenant to pay to the landlord or deposit with the Controller within one month of the date of the order, an amount calculated at the rate of rent at which it was last paid for the period for which the arrears of the rent were legally recoverable from the ten- ant including the period subsequent thereto up to the end of the month previous to that in which payment or deposit is made and to conti- nue to pay or deposit month by month, by the fifteenth of each succeeding month, a sum equivalent to the rent at that rate. (3) If, in any proceeding referred to in subsection (1) or sub-section 2), the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s being withheld under an agreement was an afterthought and not true. The High Court and the Rent Control Tribunal have agreed with this view of the Rent Controller and the conclusion appears to us to be sound. Once such a conclusion is reached, it is quite manifest that the order was made after affording an opportunity to the appellant to be heard. No doubt, the appellant is entitled to lead oral evidence in regard to the agreement he alleges, but for that he will have an opportunity hereafter. At the moment, he is being asked to deposit the arrears in court, which admittedly are outstanding. Mr. Desai next contended that the notice under s. 46(5A) amounted to a garnishee order and the appellant could not, while the notice stood, make any payment without incurring personal liability. There was no question of a personal liability because the Rent Controller had stated in his order that the amount would not be paid to anyone till the clearance certificate was obtained from the Income-tax Department. The Rent Controller had informed the income-tax authorities and the appellant ran no risk in depositing the arrears of rent in the circumstances. It was contended that the notice under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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