Supreme Court Protects Tenant from Eviction Despite Rent Dispute: Shanti Prasad vs. Thakur Dass (2023)

LEGAL ISSUE: Whether a tenant is entitled to protection from eviction under Section 20(4) of the Uttar Pradesh Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972, if they deposit the arrears of rent, interest, and costs, even if they dispute the agreed-upon rent amount.

CASE TYPE: Civil (Rent Control and Eviction)

Case Name: Shanti Prasad (D) Thr. LRs vs. Thakur Dass (D) Thr. LRs & Others

Judgment Date: 01 March 2023

Date of the Judgment: 01 March 2023
Citation: 2023 INSC 1852
Judges: Justice Manoj Misra and Justice Aravind Kumar

Can a tenant be evicted for a minor discrepancy in the claimed rent amount, despite having deposited the full arrears? The Supreme Court of India recently addressed this crucial question in a case concerning the Uttar Pradesh Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972. The Court examined whether a tenant who deposited the full amount of rent arrears, interest, and costs could be denied protection from eviction solely because they disputed the agreed-upon rent. This judgment, delivered by a bench comprising Justice Manoj Misra and Justice Aravind Kumar, has significant implications for tenant rights in Uttar Pradesh.

Case Background

The case involves a dispute between Shanti Prasad (the tenant, now represented by his legal heirs) and Thakur Dass (the landlord, also represented by his legal heirs). The landlord initiated a suit for recovery of rent arrears and eviction against the tenant, alleging that the tenant had defaulted on rent payments and made unauthorized alterations to the property. The trial court ruled against the tenant on most issues, decreeing the suit in favor of the landlord, except on the issue of material alteration.

Timeline:

Course of Proceedings

The trial court initially ruled against the tenant, ordering eviction and payment of arrears. The tenant then filed a civil revision before the High Court of Judicature at Allahabad, which was also dismissed. The tenant then appealed to the Supreme Court of India, challenging the eviction order.

Legal Framework

The case revolves around Section 20(4) of the Uttar Pradesh Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 (U.P. Act No. 13 of 1972). This section provides tenants with protection against eviction if they deposit the full amount of rent arrears, interest, and costs of the suit on or before the first date of hearing. The relevant portion of Section 20(4) of the U.P. Act states:

“In any suit for eviction on the ground mentioned in clause (a) of sub-section (2), if at the first hearing of the suit, the tenant unconditionally pays or tenders to the landlord or deposits in Court the entire amount of rent and damages for use and occupation of the building due from him, together with interest thereon at the rate of nine per cent per annum and the landlord’s full costs of the suit, the Court may, in lieu of passing a decree for eviction on that ground, pass an order relieving the tenant against his liability for eviction on that ground.”

Arguments

The appellant argued that he had deposited Rs. 8910 on 21st October 1978, which covered the arrears of rent, interest, and costs of the suit. This deposit was made before the first date of hearing. The appellant contended that the benefit of Section 20(4) of the U.P. Act should not be denied simply because he claimed the rent to be Rs. 45 per month, while the court determined it to be Rs. 150 per month.

The appellant argued that the deposit was unconditional and met the requirements of Section 20(4) of the U.P. Act. The discrepancy in the claimed rent should not negate the protection provided by this provision.

The respondent did not appear before the Supreme Court. However, the trial court and the revisional court had previously held that the deposit was conditional because the tenant had disputed the rent amount, thus disentitling him to the benefit of Section 20(4) of the U.P. Act.

Issues Framed by the Supreme Court

The primary issue before the Supreme Court was:

✓ Whether the tenant/appellant was entitled to protection against eviction under Section 20(4) of the U.P. Act, given that he had deposited the required amount, despite disputing the rate of rent.

Treatment of the Issue by the Court

Authorities

The Supreme Court relied on the following authority:

✓ Vijay Laxmi Gangal v. Mahendra Pratap Garg [1985] 3 SCC 364 – The Supreme Court of India held that the discretionary relief under Section 20(4) of the U.P. Act should not be denied to a tenant merely because they failed to prove their case regarding the quantum of rent, provided they deposited the rent at the rate claimed by the landlord, along with interest and costs, within the stipulated time.

The Supreme Court also considered Section 20(4) of the Uttar Pradesh Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972.

Judgment

What weighed in the mind of the Court?

The Supreme Court emphasized that the U.P. Act is a social legislation intended to protect tenants. The Court found that the tenant had complied with the requirements of Section 20(4) by depositing the full amount of arrears, interest, and costs before the first hearing. The discrepancy in the claimed rent was not considered a valid reason to deny the tenant the protection provided by the law. The Court’s reasoning was focused on ensuring that the intent of the legislation, which is to protect tenants from eviction, is upheld.

The Court’s decision was primarily influenced by legal interpretations and the intent of the U.P. Act, rather than the specific factual details of the case.

The Supreme Court overturned the High Court’s decision, stating, “In light of the law expounded by this Court in Vijay Laxmi Gangal (supra) , while keeping in mind that there is no dispute that on or before the first date of hearing the appellant had deposited the arrears of rent as demanded together with interest and costs of the suit, we are of the view that the appellant/tenant was entitled to the benefit of the provision of sub-section (4) of Section 20 of the U.P. Act and the courts below were not justified in denying its benefit to the appellant/tenant only on the ground that the plea taken by him with regard to the rate of rent was found incorrect.”

The Court emphasized that the U.P. Act is a social piece of legislation that leans in favor of tenants, as held in Vijay Laxmi Gangal v. Mahendra Pratap Garg [1985] 3 SCC 364. The Court stated, “Merely because the tenant had failed to prove his case that the rent was only Rs 125 per mensem and not Rs 360 per mensem, the discretionary relief could not be denied to him even though he had deposited the arrears of rent at the rate claimed by the landlord in the plaint together with interest and costs within the time mentioned in Section 20(4) of the Act.”

The Court concluded, “For the reasons aforesaid, the impugned order of the High Court to the extent it affirms the decree of eviction is set-aside. The order of the trial court to the extent it directs for eviction of the appellant is set-aside.”

The Court held that the lower courts were wrong in denying the tenant the benefit of Section 20(4) of the U.P. Act. The court set aside the eviction order but maintained the remaining part of the decree.

Key Takeaways

• ✓ Tenants in Uttar Pradesh are protected from eviction under Section 20(4) of the U.P. Act if they deposit the full amount of rent arrears, interest, and costs before the first hearing.
• ✓ A minor discrepancy in the claimed rent amount does not negate the tenant’s right to protection under Section 20(4), provided the full amount demanded by the landlord is deposited.
• ✓ The U.P. Act is a social legislation that favors tenants, and its provisions should be interpreted to protect their rights.

Directions

The Supreme Court set aside the eviction order passed by the High Court and the trial court.

Development of Law

The ratio decidendi of this case is that a tenant cannot be denied the protection of Section 20(4) of the U.P. Act if they have deposited the full amount of arrears, interest, and costs before the first hearing, even if they dispute the rate of rent. This reinforces the pro-tenant stance of the U.P. Act and clarifies that minor discrepancies in rent claims should not negate the protection offered by the law.

Conclusion

The Supreme Court’s judgment in Shanti Prasad vs. Thakur Dass reinforces the protection afforded to tenants under the U.P. Act. It clarifies that tenants who deposit the full amount of arrears, interest, and costs before the first hearing are entitled to protection from eviction, even if they dispute the agreed-upon rent amount. This decision ensures that the intent of the social legislation, which is to protect tenants, is upheld.