Const. Petition No.S-447 of 2008
Present
Mr. Justice Aqeel Ahmed Abbasi.
Date of hearing : 02.02.2012
Date of judgment : 12.04.2012
Petitioner : Ali Asghar Siddiq through
Mr. Ali Mumtaz Shaikh, Advocate.
Versus
Respondent : M/s Tyms Education (Pvt) Ltd.
through M/s Arshad Hussain & Haqdad Khoso, Advocates.
J U D G M E N T
Aqeel Ahmed Abbasi, J. Being aggrieved and dissatisfied with the judgment passed by the learned Vth Additional District Judge, Karachi South, dated 05.09.2008 in F.R.A. No.50/2006, whereby the finding of the learned Rent Controller on the point of default in payment of rent was set-aside and the appeal was allowed, the petitioner has filed the instant petition with a prayer to set-aside the impugned order and restore the order of the learned Rent Controller.
2. Brief facts as stated in the instant petition are that petitioner is the owner of plot bearing No.51-C, Old Clifton, Karachi, whereas the respondent is the tenant in the said premises at a monthly rent of Rs.50,000/- as per tenancy agreement dated 22.05.1996. The said premises was let out to the respondent for the purpose of establishing a school and tenancy agreement was initially for a period of two years and subsequently renewed by another agreement dated 17.5.1998 and it was agreed that the rate of rent to be paid will be @ Rs.60,000/- per month, less withholding tax @ 7.5% of the rent. According to the petitioner, the respondent paid rent upto 30.04.2000, thereafter the later stopped payment of rent and started to deposit the same in M.R.C. No.1618/2000, whereas the rent agreement dated 17.05.1999 expired on 30.04.2000. However, the respondent, for reason best known to them, started to deposit the full amount of rent in M.R.C, while it was agreed that in case the payment is made to the petitioner, they will deduct the amount of income tax. Ejectment application was filed by the petitioner on the ground that since the respondent has failed to pay the monthly rent to the petitioner as per the terms of rent agreement, as such committed willful default. It has been further stated that petitioner is a teacher and intends to open his own school, therefore, the demised premises is required for his personal bonafide use, whereas, the petitioner has been requesting the respondent to vacate the premises, but the later paid no heed to the said requests.
3. The respondent filed written statement within preliminary objections on the maintainability of the ejectment application was raised on the ground that the petitioner has got no cause of action to file ejectment application, which, as per respondent, was premature as the lease agreement dated 17.05.1999 still subsisted. The respondent admitted the tenancy between the parties as well as rate of rent, however, denied the allegations of regularly default, stated that they had paid upto date rent of the premises to petitioner and also regularly paying the upto date rent without any default. It has been further stated that the respondent paid a sum of Rs.12,00,000/- towards two years advance rent after deducting withholding tax @ Rs.6,10,000/- as advance rent as per tenancy agreement dated 17.05.1998. The petitioner as well as the respondent filed their affidavits-in-evidence alongwith photocopies of documents.
4. The learned Rent Controller framed the following issues:
1. Whether the Opponent committed default in payment of rent as per the terms of the rent agreement?
2. Whether the Applicant required the premises in his personal use and in good faith?
3. What should the order be?
5. The learned Rent Controller after hearing both the parties allowed the ejectment application on the ground of default. Thereafter, the respondent filed First Rent Appeal No.05 of 2006 before the learned Vth ADJ (South) Karachi, who vide impugned order dated 5.9.2008, allowed the appeal and set-aside the order passed by the learned Rent Controller.
6. On being aggrieved and dis-satisfied with the above said order, the petitioner has filed instant petition with the prayer to set-aside the impugned order dated 05.09.2008 passed in F.R.A. No.50 of 2006, and to restore the order dated 24.12.2005 passed by the learned Rent Controller, Karachi-South, in Rent Case No.07 of 2003.
7. Learned counsel for the petitioner has argued that the impugned order suffers from factual and legal errors and has been passed by ignoring the settled principle of law, hence liable to be set-aside. It is contended by the leaned counsel that the learned Vth Additional District Judge, Karachi-South, failed to appreciate that after expiry of the agreement the terms and conditions of such agreement continue to be enforced, whereby the respondent was required to deposit yearly advance rent. Per learned counsel, in terms of agreement, Rs.60,000/- per month less withholding tax at the rate of 7.5% was required to be paid by the respondent to the petitioner, whereas instead of depositing such rent with the petitioner the respondent admittedly, without resorting to provision of Section 10 of Sindh Rented Premises Ordinance, 1979, has deposited the rent directly i.e. in M.R.C. No.1618 of 2000. It has been further contended by the learned counsel that the default on the part of the respondent is manifest from the record, as admittedly prior to depositing the rent in M.R.C. no attempt was made by the respondent to deposit the rent with the petitioner through money order. It is contended by the learned counsel that the withdrawal of rent by the petitioner in M.R.C. does not amount to waiver and such fact does not vitiate the default committed by the respondent. Learned counsel has contended that there is no waiver in case of default in payment of rent by the tenant to the landlord. It has been further contended that the learned Appellate Court failed to appreciate that the terms of the agreement continue even after expiry, provided the same are not violative of provisions of Sindh Rented Premises Ordinance, 1979. Per learned counsel, though the initial burden to proof that the tenant has not paid rent is upon the landlord, however, onus the landlord appears in Court and makes a statement on oath that he has not received the rent, then such burden is dis-charged, and the onus, shifts upon the tenant to prove that he has tendered the rent for the period in question. It is contended by the learned counsel, that in the instant case, the petitioner has satisfactorily dis-charged his onus by stating on oath that the respondent has committed default in payment of rent, whereas the respondent has miserably failed to discharge such burden through evidence, hence the fact of having committed default in payment of rent is established against the respondent.
8. In addition to above submissions made on the ground of default, the learned counsel for the petitioner has challenged the order of the learned Additional District Judge, on the ground of limitation also, as according to learned counsel, the First Rent Appeal filed by the respondent before the learned appellate Court was time barred. It is contended that certified copy of the order dated 24.10.2005 was made ready for delivery on 21.11.2005 i.e. after expiry of period of limitation to file First Rent Appeal, which according to learned counsel expired on 21.12.2005, whereas admittedly the said appeal was filed on 31.01.2006. Learned counsel for the petitioner referred to provision of Section 12(2) of the Limitation Act, and submitted that the respondent was entitled to the exclusion of period requisite in obtaining the certified copy of the order i.e. from the date of application for certified copy and to the date when it was ready for delivery. Per learned counsel, in the instant case the benefit of exclusion of period from 24.10.2005 to 21.11.2005 could have been given to the respondent and the appeal should have been preferred on or before 21.12.2005. In support of his arguments, learned counsel has placed reliance on the following judgments.
1. Din Muhammad v. Abdul Aziz PLD 1967 Lahore 653.
2. Fateh Muhammad and others v. Malik Qadir Bakhsh 1975 SCMR 157.
3. Muhammad Ali Hemani (through legal heirs) v. Custodian of Evacuee Property, Lahore and 3 others PLD 1976 Karachi 109
4. Mst. Jamila Khatoon and another v. Mst. Tajunnisa and others PLD 1984 Supreme Court 208
5. Haji Fazal Ahmed v. Anjuman Jamia Masjid Haqqani, Burmmee Muslim Muhajir Colony 1996 MLD Karachi 1842
6. Messrs Pak-Libya Holding Company (Pvt) Ltd. v. Bashir Ahmed Memon 1999 MLD Karachi 2132
7. Allah Din v. Habib PLD 1982 SC 465
8. Madan Gopal and 4 others v. Maran Bepari and 3 others PLD 1969 SC 617
9. Harmes and another v. Hinkson AIR (33) 1946 Privy Council 156
10. Muhammad Shaikh and another v. Maminuddin Shaikh and others PLD 1971 Dacca 106
11. Muhammad Sharif Khan v. Mst. Ismat Bi and 4 others PLD 1982 SC (AJ&K) 76
12. Muhammad Ashraf v. Muhammad Sharif and 3 others PLD 1971 Lahore 610
13. Alif Din v. Khadim Hussain 1980 SCMR 767
14. Mrs. Zarina Khawaja v. Agha Mahboob Shah PLD 1988 SC 190
15. Syed Asghar Ali Imam v. Muhammad Ali PLD 1988 SC 228
16. Shezan Limited v. Abdul Ghaffar and others 1992 SCMR 2400
17. Mst. Baswar Sultan v. Mst. Adeeba Alvi 2002 SCMR 326
18. S.M. Ayub v. Syed Yusaf Shah and 2 others PLD 1967 SC 486
19. Mrs. Dino Manekji Chinoy and 8 others v. Muhammad Matin PLD 1983 SC 693
20. Mst. Saeeda Khatoon v. Muhammad Ahmad Latifi 1985 CLC (Karachi) 1392
21. Prof. (Retd.) Masoodul Hassan v. Muhammad Iqbal PLD 1998 Lahore 177
22. Muhammad Saleh v. Muhammad Shafi 1982 SCMR 33
23. Muhammad Aminuddin Qureshi v. Salahuddin 1990 CLC (Karachi) 1324
24. Mrs. Afia Baig v. Messrs Pakistan State Oil Company Ltd. PLD 1991 Karachi 239
25. Syed Jalilur Rehman and 7 others v. Mst. Rashida Begum and 10 others PLD 1976 Karachi 105
26. Pakistan State Oil Company Ltd., Karachi v. Pirjee Muhammad Naqi 2001 SCMR 1140
27. Mst. Yasmeen Khan v. Abdul Qadir and another 2006 SCMR 1501
9. Conversely, the learned counsel for the respondent has argued that the respondent is the lawful tenant in the said premises which was let out to the respondent initially for 2 years, however, the agreement was renewable for another five years at the option of the respondent. The respondent opened the school under the name and style of “The International School”. Per learned counsel, the respondent has invested huge amount to establish and operate the said school. The respondent and petitioner renewed the tenancy agreement in May 1999 for a period of another 11 months. The petitioner increased the monthly rent from Rs.50,000/- to Rs.60,000/- per month less the withholding tax of 7.5% of the rent. It is submitted that in or around February 1999, the KBCA had served a show cause notice alleging therein that respondent is running educational institution by changing the nature and use of the premises. Per learned counsel, such notice was addressed to the petitioner but the petitioner did not respond to the said notice. Thereafter another notice dated 08.02.2002 was issued by KBCA to the respondent alleging therein that the premises in question was being misused in violation of the lease conditions and it was further threatened that the KBCA would seal the demised premises and would cancel the lease if the educational activity of the respondent was not stopped within seven days. Learned counsel has vehemently argued that the petitioner was instrumental in getting these notices issued from KBCA in order to evict the respondent from the premises un-authorizedly with the object to let it out to some other party at a higher rent. Per learned counsel, the respondent anticipating an adverse and coercive action from the petitioner through KBCA filed a suit bearing No.214/2000 in the High Court against the petitioner and the KBCA. The said suit was disposed of in favour of the respondent. Learned counsel further argued that Agreement dated 17.05.1999 expired on 30.04.2000, whereas no default was committed towards payment of rent. Thereafter, the respondent offered the rent of May, 2000 to the petitioner for which the petitioner refused to accept. The petitioner through his counsel served a legal notice upon the respondent for vacating the demised premises on the fabricated ground that the respondent school cannot be operated from the demised premises. The respondent foreseeing a foul play at the hands of the petitioner, primarily to create a mis-conceived ground of default in payment of rent filed MRC bearing No.1618/2000 before the Xth Sr. Civil Judge, Karachi South, wherein the respondent was allowed to deposit monthly rent in respect of subject tenement, and since then the respondent is regularly depositing the rent in Court, whereas the petitioner is regularly withdrawing the same without any objections whatsoever.
10. It has been further contended by the learned counsel for the respondent that since 1999 the petitioner is attempting to evict the respondent through different illegal modes, starting from issuance of notices from the KBCA, causing harassment and refusing to accept the rent etc. Per learned counsel, the stand taken by the petitioner in rent proceedings is contrary to his previous stands, which clearly reflects upon the malafide intention of the petitioner. Learned counsel has pointed out that the petitioner is regularly withdrawing the rent from MRC since the year 2000 without raising any objection, however, the Rent Case No.07/2003 was filed in the year 2003 with malafide intention and without any valid cause of action. Per learned counsel, ejectment was allowed on the ground of default only, whereas the ground of personal need was rejected by the Rent Controller with the following observations, “the plea of personal bonafide of the applicant is based upon malafide intention which is apparent from his own evidence”. It is further submitted that the order of Rent Controller has only been challenged by the respondent by filing F.R.A. No.50/2006, whereas the petitioner did not challenge the findings of the learned Rent Controller on personal bonafide need. Per learned counsel, the finding of learned Rent Controller on default was perverse and the same has been rightly set-aside by learned Additional District Judge, which is based on proper appreciation of facts and the settled principles of law, hence do not require any interference by this Court in its constitutional jurisdiction. Learned counsel further submitted that the petitioner approached the learned Rent Controller with unclean hands and with malafide intention which was acknowledged by the Rent Controller, while observing that “the plea of personal bona fide need of the applicant is based upon malafide intention which is apparent from his own evidence”. It is stated that after expiry of tenancy agreement the petitioner refused to receive the rent. Upon refusal, the respondent having no other option started to deposit rent in the MRC in favour of the petitioner and has never defaulted in payment of rent. Per learned counsel, the eviction application, as well as the affidavit-in-evidence of the petitioner is completely silent regarding default in payment of monthly rent, on the contrary, in both the ejectment application and the affidavit-in-evidence of the petitioner, the nature of default has been mentioned as “deposit of Rs.60,000/- without deduction of withholding tax”. Per learned counsel, framing of the issues in respect of default in payment of rent and the finding thereon by the learned Rent Controller based on extraneous considerations was there absolutely outside the pleadings, hence the finding of the Rent Controller in respect thereof was rightly reversed by the learned Appellate Court.
11. Learned counsel for the respondent has further argued that firstly there is no default at all in payment of monthly rent, secondly, for the sake of argument even if it is assumed that non-deposit of the advance rent of whole year is default then it is not a willful default and the respondent is not liable to be ejected on this ground and thirdly, since the petitioner continuously has been withdrawing the rent from the Court since the year 2000 without raising any objection and has filed the rent case after a after a lapse of about three years on 16.09.2003, thus, the acceptance of rent by petitioner, without any protest, and not filing ejectment proceedings within a reasonable time, amounts to acceptance of fresh terms as well as waiver of such default. It has been argued that the demised premises was taken on rent for operating a school and there is a specific clause to this effect in the tenancy agreement, whereas, the petitioner has become greedy and expecting higher rent. At present a large number of students are studying in respondent’s school and if the eviction of the respondent is maintained and the school is closed down, it would be a great loss not only to the respondent but also to the students as their academic career will be adversely affected on account of frivolous litigation initiated by the petitioner.
12. In support of his contention, learned counsel has placed reliance on the following judgments:
1. Adam Ahmed Thaqia v. Muhammad Hanif 1988 CLC 1709
2. Azad Government and 2 others v. Sardar Muhammad Ashfaq Khan 2001 MLD 514
3. Abdul Azizullah and others v. Anjuman Asna Ashria and Ahliyan-e-Jah Dagh (Regd.) and others 2000 MLD 2007
4. Shaikh Israr v. Muhammad Arif Khan 2001 YLR 442
5. Muhammad Younus v. Dr. S. Muzammil Ali 1981 CLC 327
6. Abdullah v. Highway 1987 CLC 144
7. Adam Amjad Thaqia v. Muhammad Hanif 1988 CLC 1703
8. Mst. Aisha Khatoon v. Irfan Ali Khan 1987 MLD 3062
9. Allah Bux v. Sarwari Begum 1987 CLC 1714
10. United Bank Limited v. Mrs. Aafia Hussain 1999 SCMR 1796
11. Yaqoob Ali v. Ismail 1987 CLC 526
12. Najamuddin v. Zamir Ahmed PLD 1982 Karachi 188
13. Mohammad Ahmed v. Mst. Qamar Anwar Shaikh PLJ 1980 Karachi 136
14. Mst. Noori and another v. Ghulam Muhammad 1981 CLC 797
15. Mst. Safdari Begum v. Amir Ali Tabrezi 1985 CLC 826
13. I have heard both the learned counsel and perused the record. From the perusal of the pleadings and the orders passed by the learned Rent Controller as well as the Appellate Court and after hearing both the counsel for the parties, the controversy appears to revolve around following legal points:
(1) Whether after expiry of a tenancy agreement, relationship between the parties is to be governed under the terms as contained in the expired tenancy agreement or the statutory provisions will prevail?
(2) Whether, deposit of rent by the tenant in MRC on refusal by the landlord is a valid tender or not?
(3) Whether after expiry of tenancy agreement, the deposit of full rent in M.R.C without withholding tax at the rate of 7.5% would amount to default in payment of rent?
14. Admittedly, the premises was given on monthly rent at the rate of Rs.50,000/- as per tenancy agreement dated 22.5.1996. Such agreement was initially for a period of two years and was subsequently renewed by another agreement dated 17.5.1998, wherein it was agreed that the rent of the premises will be paid at the rate of Rs.60,000/- per month less withholding tax @ 7.5% of the rent. Thereafter, another agreement dated 17.5.1999 for 11 months was also executed between the parties in the similar terms. It will be advantageous to reproduce the relevant clauses of such agreement relating to mode and manner of payment of rent and deduction of withholding tax thereon which reads as follows
“That the present lease will be for a period of 11 months, beginning from the 1st day of June 1999 and expiring on the 30th April 2000 and the Lessee can exercise the right to extend the lease for upto five years at the agreed rental payable annually as advance”
“THAT the Lessee shall pay to the Lessor a total sum of Rs.610500/- (Rupees six hundred and ten thousand five hundred only), which will be the advance rent for eleven (11) months @ Rs.60,000/- per month LESS withholding tax of 7.5% of the rental amount for the lease period.”
15. From perusal of hereinabove clauses, it is seen that the lease agreement was for a period of 11 months beginning from 1st June 1999 and expiring on 30th April 2000. It is further seen that in terms of the lease agreement, the Lessee was required to pay the lessor total sum of Rs.610500/- (Rupees Six hundred ten thousand and five hundred only), which will be considered as advance rent for 11 months at the rate of Rs.60,000/- per month less withholding tax of 7.5% of the rental amount for the lease period. It has come on record that the respondent made payment towards rent in terms of the agreements as mentioned hereinabove and there was no default in payment of rent upto 30th April 2000. On expiry of the above said agreement the parties did not execute any other tenancy agreement in writing, however, the tenancy continued and the respondent started depositing rent in M.R.C No.1618/2000 at the rate of Rs.60,000/- per month in favour of the petitioner. It has also come on record that the petitioner continued to withdraw the rent regularly from M.R.C for more than a period of two years whereafter in the year 2003 Rent Case No.07/2003 was filed by the petitioner seeking ejectment of the respondent on the ground of personal need and default. The Rent Controller allowed the ejectment application on the ground of default, however, the ground of personal need was declined. The petitioner did not file any appeal against such finding of personal need, whereas the order passed by the Rent Controller was assailed by the respondent by filing F.R.A No.50/2006 before the learned Vth Additional District Judge, Karachi South, who vide impugned judgment dated 5.09.2008, after having examined the facts and the evidence produced by the parties concurred with the finding of the learned Rent Controller, hence dismissed the appeal filed by the petitioner. The petitioner being aggrieved by such concurrent finding of the courts below has filed instant petition with the following prayer:-
“To set aside the impugned order dated 05.09.2008 passed in FRA No.50/06 and restore the order dated 24.10.2005 passed by the 11th Senior Civil Judge/Rent Controller Karachi South, for Rent Case No.7/03.”
16. Keeping in view the peculiar facts of this case, I would venture to respond to point No.1 as formulated hereinabove with the assistance of the judgment of the Supreme Court on the subject referring to the case of Zarina Khawaja v. Mehboob Shah reported as PLD 1988 SC 190, wherein the Hon’ble Supreme Court has held as under:
“We have carefully considered the implication of various judgments of the Supreme Court which deal with the question of continuance of the terms of agreement of tenancy, after its termination. Leaving aside the theoretical possibilities all of them can be interpreted consistently on the following lines:
ONE: notwithstanding the enactment of the rent laws the relationship of landlord and tenant would continue to be determined and regulated in accordance with:
(a) the general law; and,
(b) the terms of tenancy between the parties,- But, subject to the very important condition that in case of repugnancy of either of these two elements to any of the provisions of the rent law the latter shall prevail; meaning thereby that the provisions of the general law and/or the covenants, in the agreement to the contrary, shall have no effect;
TWO: during the continuance and subsistence of the agreement of tenancy, the question of relationship of landlord and tenant, the regulation of that relationship particularly vis-à-vis the determination and payment of rent; as also the eviction, shall be governed by the covenants contained in the agreement; provided that those covenants do not come in conflict with the provisions of the rent law and in case of conflict the provisions of that law will prevail not withstanding any term of agreement to the contrary;
THREE: after the expiry of the agreement of tenancy the general law of holding over by the tenant has not been repealed or modified by the rent laws except to the extent that it comes in conflict with the provisions of the Rent Restriction Law. On the contrary, it was specifically provided in the definition of a ‘tenant’ in section 2 of the West Pakistan Urban Rent Restriction Ordinance, 1959, that a tenant would include “a tenant continuing in possession after the termination of the tenancy in his favour”. The definition of tenant in the present Sind Law also provides that a tenant would include “any person who continues to be in possession or occupation of the premises after the termination of his tenancy”. Not only this, the present Sind Law made it more clear when the provisions contained in sections 6 and 15 (2) (i) of the Sindh Rented Premises Ordinance 1979, providing that no tenancy would remain valid beyond the mutually agreed period and that a tenant would be liable to be evicted on termination of such period, were repealed. The obvious reason was that the preexisting law before the reenactment was kept intact; namely, that the previous tenancy agreements between the parties will continue to operate notwithstanding the termination of the period and will govern the continuance of tenancy as visualized in the definition of the tenant holding over. However, notwithstanding the continued operation of the terms of the agreement after the termination of the agreement; by process of law as aforesaid, its provisions whenever they are in conflict with the rent law, shall not be operative. For example, if a special method of eviction of the tenant is provided in the terms of the agreement which are repugnant to the provision contained in the relevant Rent Restriction Law, the latter shall prevail to the extent of repugnancy. Section 15 of the Sind Law is explicit on this point. Same was the position in the repealed law. Similar would be the case relating to some other situations, for example, the determination of the fair rent. Similarly the vice versa position would also be correct. The terms of the so-called expired agreement which are not repugnant to the rent law shall continue to operate. For example, the rate of rent, the mode of payment thereof including its advance payment or deposit, provision for agreed increase in rent provided it is not after the determination of fair rent, provision for re-entry of a tenant after he vacates the premises for re-consideration, all convenants which support the conditions in section 15 of the Sind Law and section 13 of the Law Repealed by it, and similar other conditions and comments. There is useful discussion on this aspect in the case of Muhammad Yunus Malik v. Mst. Zahida Irshad 1980 SCMR 184. We accordingly answer the 4th question in the negative and hold that the terms of an expired agreement as such, continue in operation, to the extent they are not repugnant to the Rent Law. Indeed same would be the position with an unexpired agreement also.
It needs to be clarified that the four judgments of this Court reported in 1980 Law Journals and one in 1985, though seemingly containing some elements requiring further explanation, are not mutually exclusive. They are in the cases of Muhammad Yousuf PLD 1980 SC 298; Muhammad Yunus Malik 1980 SCMR 184; Alif Din 1980 SCMR 767; Mirza Abdul Aziz Beg 1980 SCMR 834 and Sheikh Abdus Sattar PLD 1985 SC 148. One case of 1981 viz., Muhammad Baqar Qureshi v. Mst. Razia Begum 1981 SCMR 18 may also be included. In the first case the concept of holding over in the general law of Transfer of Property Act (No.IV of 1982) was accepted, as lawful vehicle of keeping the terms of an expired agreement alive subject of course to repugnancy with any provision of the rent law to the contrary. In particular, the covenants as to advance rent and date of payment in the expired agreement were enforced and thus, the agreement was continued. Same is the position in the third case. In both of them, Muhammad Ashraf v. Muhammad Sharif PLD 1971 Lah. 610, a case of Lahore High Court, was approved. In the second case though the tenancy, after expiry of the agreement, was termed as ‘statutory’ and holding over concept was kept excluded but the terms of tenancy as to rate of rent were nevertheless taken from the so-called expired agreement. Its naming as “statutory rent” was not meant to obliterate its source being the same agreement. And, it is important to emphasise, that at page 306 the possibility of expired agreements having terms not inconsistent with the rent law, has been visualized, though stated to be exceptional. Thus, such terms, would continue to operate. We may add that in the ultimate analysis such tenancies which are controlled by rent law are in any case composite; having both statutory and mutually agreed terms; and, when an expired agreement is kept alive, this composite nature does not change, though law of holding over is added to the rent law and the agreement. The fourth case recognizes advance rent and security deposit as possible subjects of an agreement enforced by the rent law. The fifth case goes in line with the third case and not beyond it but in a different context. The remaining cases also do not change the position.
Thus, it can safely be said that the rent laws permit all covenants in agreements, alive or expired; which, are permissible under the general law and not inconsistent with or repugnant to that special law; and enforces the same accordingly whenever it is so required under that law. In addition, they also remain operative for other purposes permitted by the general law. The fourth question is answered in the negative.”
17. The ratio of the above mentioned judgment was followed by the Hon’ble Supreme Court in its subsequent judgment in the case of Shezan Limited v. Abdul Ghaffar and others reported as 1992 SCMR 2400, wherein the Hon’ble Supreme Court has held as under:
“7. The last renewal of the agreement, expired in or about September, 1981. The question, whether the terms of an expired tenancy agreement are binding or not on the parties, stands finally settled inter alia by the judgment of this Court in the case of Mrs. Zarina Khawaja v. Agha Mahbood Shah (PLD 1988 SC 190), wherein Muhammad Afzal Zullah, J. (as his Lordship then was), after referring to the case-law, observed as follows:-
‘There is useful discussion on this aspect in the case of Muhammad Yunus Malik v. Mst. Zahida Irshad 1980 SCMR 184. We accordingly answer the 4th question in the negative and hold that the terms of an expired agreement as such, continue in operation, to the extent they are not repugnant to the Rent Law. Indeed same would be the position with an unexpired agreement also.’”
18. In view of hereinabove judgment of the Hon’ble Supreme Court, it is clear that after expiry of the tenancy agreement the tenancy is governed by statutory provisions whereas terms of the expired agreement, which are inconsistent with the statutory provisions, cannot be enforced. In the instant case, admittedly, after expiry of the tenancy agreement the parties did not execute fresh agreement. It is admitted position that tenant continued to enjoy the possession of the tenement as statutory tenant and the relationship between landlord and tenant continued to be regulated by provisions of Sindh Rented Premises Ordinance, 1979. After expiry of the tenancy agreement, the deposit of monthly rent was to be governed under the statutory provision i.e. section 10 of the Sindh Rented Premises Ordinance, 1979, whereby in the absence of any agreement between the landlord and tenant rent is required to be paid not later than the tenth of month next following the months for which it is due. From perusal of the evidence, it has come on record that after expiry of the agreement and on refusal by the petitioner to accept the rent the respondent started to deposit monthly rent in the MRC after seeking permission of the learned Rent Controller, whereas the respondent never objected to such deposit of monthly rent in the MRC on the contrary continued to withdraw the said rent regularly for about three years till filing of ejectment application. Prima-facie in view of hereinabove facts, there appears no willful default on the part of respondent towards payment of monthly rent in accordance with statutory provisions. Accordingly, respond to this point is in affirmative in the above terms.
19. Before responding to point No.2, as formulated hereinabove, it will be advantageous to refer to the relevant facts of the instant case whereby it has come on record that the relations between landlord and tenant become strain, whereas an attempt was made by the landlord to get the tenant evicted from the tenement through KBCA, who issued show cause notice, wherein it was alleged that since the tenant is running educational institution by changing the nature and use of the premises, therefore, the same will be sealed, educational activities will be stopped and lease will be cancelled. Under the circumstances, respondent was compelled to file a suit bearing No.214/2000 in the High Court against the petitioner and the KBCA, whereafter intervention of the Court, such action was stopped. The tenancy agreement between the petitioner and the respondent expired in April 2000, whereafter the tenant tendered rent for the month of May, 2000 to the petitioner, which was refused by the landlord. Such fact is reflected from the reading of contents of para 3 of the application moved by the respondent under Section 10(3) of Sindh Rented Premises Ordinance, 1979 i.e. (M.R.C No.1618/2000 Exhibit O/6) as well as in the written statement filed before the Rent Controller. It appears such fact has not been denied by the petitioner nor the same could be controverted either through cross-examination of the respondent or through any other evidence produced by the parties. It is pertinent to note that neither in the ejectment application nor in the affidavit-in-evidence of the landlord, it has been alleged that there has been any default in payment of rent for any particular period. On the contrary, it has been alleged by the landlord that the respondent has deposited rent in MRC without deducting withholding tax thereby the respondent has committed default in payment of rent. It has also come on record that the landlord never disputed the deposit of rent by the tenant in MRC. Whereas, he has been withdrawing rent from the said MRC since inception and after a lapse of about three years ejectment proceedings have been filed by the landlord in the year 2003 on the ground of personal need and default in payment of rent. From the conduct of the parties and keeping in view the litigation between the parties, their strain relations, and no objection whatsoever by the landlord regarding regular payment of monthly rent in the MRC for about three years when the ejectment proceedings were filed, it appears that the tenant was justified in tendering rent in the MRC on refusal by the landlord. Moreover, the petitioner cannot be allowed to raise a fresh plea at this stage, which was not raised by him at initial proceeding. Accordingly, respond to this point is also in affirmative.
20. As regards respond to point No.3, as formulated hereinabove, it has already been discussed in detailed while responding to point No.1 hereinabove that in view of the judgments of the Hon’ble Supreme Court in the case of Zarina Khawaja v. Mehboob Shah reported as PLD 1988 SC 190 and Shezan Limited v. Abdul Ghaffar and others reported as 1992 SCMR 2400, after expiry of tenancy agreement the terms of the expired agreement, which are inconsistent with the provisions of the statute, cannot be enforced through court of law. In the instant case, admittedly, after expiry of the tenancy agreement the tenancy was governed by statutory provisions i.e. Sindh Rented Premises Ordinance, 1979. Accordingly, the respondent in the instant case tendered monthly rent for the month of May, 2000 to the landlord which was refused. Whereafter the tenant by invoking the provisions of Section 10(3) of Sindh Rented Premises Ordinance, 1979 and after seeking permission of the Rent Controller started to deposit monthly rent in the MRC, in favour of the landlord, who in turn, started to withdraw the same from the MRC without any objection. It is pertinent to note that in terms of the expired agreement the tenant was required to pay rent to the landlord after deducting withholding tax at the rate of 7.5%. However, after expiry of such agreement, it was not incumbent upon the tenant to continue to follow the provisions of the expired agreement, which were not in consonance with the statutory provisions as contained in Section 10 of Sindh Rented Premises Ordinance, 1979. Moreover, the tenant has deposited the entire agreed rent without any deduction of withholding tax, which cannot in any manner, be termed as willful default in payment of rent by the tenant. Accordingly, respond to this point is in negative.
21. The case-law relied upon by the learned counsel for the petitioner, under the facts and circumstances of this case, and in view of the judgment of Hon’ble Supreme Court as referred to hereinabove, are distinguishable on facts hence not attracted in the instant case.
22. Before parting with this judgment it will be advantageous to refer to a judgment of the Hon’ble Supreme Court in the case of M/s Pragma Leather Industries v. Sadia Sajjad reported as PLD 1996 SC 724, wherein the Hon’ble Supreme Court, after having examined large number of judgments on the subject of ‘willful default’, has held as under:
“11. Before concluding the above judgment, we may observe that the question, as to whether a tenant is guilty of a willful default, depends on the facts of each case. If a landlord by fraud or by any other sharp practice creates a default, the Rent Controller in such a case may hold that there is no willful default on the part of the tenant concerned warranting grant of ejectment. The High Court would be justified not to interfere with the above finding as an Appellate Court. This Court would also be reluctant to upset the above concurrent finding of fact.
Whereas in the instant case concurrent finding on the question of default is in the affirmative against the appellant, which cannot be said to be contrary to the evidence on record or violative of any legal principle. Nor there is any material on record to conclude that the respondent had created above default by practicing any fraud or sharp practice on the appellant.”
23. In view of hereinabove, I do not find any error in the impugned judgment, which is based on proper appreciation of facts and correct application of law. The learned counsel for the petitioner has not been able to point out any error or illegality in the impugned judgment which may require any interference by this Court in its constitutional jurisdiction under Article 199 of Constitutional of Islamic Republic of Pakistan, 1973. Accordingly, instant petition is dismissed alongwith listed application with no order as to cost.
JUDGE