Vora Abbasbhai Alimahomed vs Haji Gulamnabi Haji Safibhai

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: Supreme Court of India

Case Number: Civil Appeal No. 470 of 1963

Decision Date: 22 October, 1963

Coram: J.C. Shah, A.K. Sarkar, Raghubar Dayal

The case titled Vora Abbasbhai Alimahomed versus Haji Gulamnabi Haji Safibhai was decided on 22 October 1963 by the Supreme Court of India. The judgment was authored by Justice C J Shah and the bench was composed of Justice C J Shah, Justice A K Sarkar and Justice Raghubar Dayal. The petitioner in the proceeding was Vora Abbasbhai Alimahomed and the respondent was Haji Gulamnabi Haji Safibhai. The date of the judgment was recorded as 22 October 1963. The decision appears in the official reports with the citations 1964 AIR 1341 and 1964 S C R (5) 157, and it has been subsequently referenced in many later reports, including but not limited to R 1965 S C 553, R 1965 S C 1419, F 1966 S C 153, R 1966 S C 439, F 1967 S C 1419, RF 1967 S C 1853, E 1968 S C 1109, E 1968 S C 1336, R 1972 S C 2379, F 1973 S C 1336, RF 1974 S C 818, D 1976 S C 588, E 1976 S C 2005, RF 1977 S C 1707, R 1978 S C 952, RF 1978 S C 1341, RF 1978 S C 1518, RF 1979 S C 1745, and F 1984 S C 1744. The statutes discussed in the judgment included the Bombay Rents, Hotel and Lodging Houses Rates Control Act, 1947, particularly section 12 with its provisions on protection against eviction, the meaning of “may” in clause 12(3)(a), the scope of section 12(1), the explanation to section 12, the definition of “standard rent”, and the revisional jurisdiction of the High Court under that Act. The Code of Civil Procedure, 1908, section 115, was also referred to for the procedural aspects of revision.

The factual background showed that the appellant, Vora Abbasbhai Alimahomed, was occupying premises owned by the respondent, Haji Gulamnabi Haji Safibhai, paying a monthly rent of Rs 70. The appellant filed an application before the Civil Judge seeking fixation of a standard rent under section 11(1) of the Bombay Rents, Hotel and Lodging Houses Rates Control Act, 1947, and also sought specification of an interim rent under section 11(3) of the same Act. In support of his application, the appellant deposited a sum of money in the respondent’s favour. Subsequently, the respondent instituted a suit before the same Civil Judge demanding eviction of the appellant on the ground that rent had not been paid. The Civil Judge ordered the appellant to pay arrears of rent calculated at Rs 51 per month and gave him fifteen days to comply. The appellant substantially complied with that order. The two proceedings – the rent‑fixation application and the eviction suit – were then amalgamated. The Civil Judge proceeded to fix the standard rent at Rs 50 per month and dismissed the eviction suit, holding that the appellant was willing to pay the standard rent within the meaning of section 12 of the Act. The appellant appealed this decision to the District Court. The District Court revisited the standard rent, fixing it at Rs 70 per mensem, and observed that the appellant had complied with the order to deposit arrears and was ready and willing to pay the standard rent. Accordingly, the District Court affirmed the lower court’s dismissal of the eviction suit. Dissatisfied, the respondent filed a revision petition before the High Court invoking section 115 of the Code of Civil Procedure, 1908. The High Court set aside the District Court’s order and directed eviction, reasoning that the appellant was not ready and willing to pay the standard rent, had failed to deposit the standard rent at the higher rate fixed by the District Court, and had not paid the interim rent as fixed by the trial court.

The Court held that Section 12(1) of the Act is applicable to a tenant who continues to occupy the premises after the contractual tenancy has terminated. Such a tenant is entitled to protection from eviction provided that he is willing and ready to pay the standard rent together with any permitted increases and that he complies with the other conditions prescribed in the Act. This protection, however, is subject to the provisions of Section 13 and to the limitations set out in Sections 12(2) and 12(3)(a). The Court explained that the word “may” in Section 12(3)(a) carries a mandatory meaning; consequently, when the conditions of that clause are satisfied, the court is compelled to pass an ejectment decree against the tenant. The principle was illustrated by reference to the decision in Bhaiya Punyalal Bhagwandin v. Bhagwat Prasad, [1963] 3 S.C.R. 312.

The Court further observed that the authority to fix the standard rent resides exclusively in Section 11(1). To invoke the protection under Section 12(3)(b), a tenant must pay or tender the standard rent fixed by the court, together with any permitted increases, on or before the first day of the hearing or on any other date that the court may specify. Costs are to be paid or deposited only if the court directs such payment. Where an appeal results in an enhanced standard rent, the appellate court may set a deadline for payment of the difference; if the tenant pays the difference by that deadline, he will be entitled to the protection afforded by Section 12(3)(h). The Court also clarified that the explanation to Section 12 creates a rule of evidence: regular payment or tender of the interim rent specified by the court up to the final disposal of the suit leads the court to presume that, at the decree date, the tenant is ready and willing to pay the standard rent and the authorized increase. The term “standard rent” in Section 12(3)(b) is not synonymous with “interim rent” in Section 11(3). Moreover, Section 12 does not require that any dispute concerning the standard rent contemplated by clause (b) of sub‑section (3) be raised before the service of notice under Section 12(3).

The Court noted that the District Court, before disposing of the appeal, should have fixed a date for payment of the difference between the standard rent due and the amount actually deposited. The Court characterized the District Court’s omission as a technical error only. Finally, the Court held that the High Court, exercising its power under Section 115 of the Code of Civil Procedure, had no authority to set aside the District Court’s order simply because it believed the lower court’s judgment was vulnerable to factual or legal error. The High Court may invoke Section 115 only when the subordinate court has acted without jurisdiction, failed to exercise its jurisdiction, or acted with material illegality or irregularity.

The Court observed that the earlier authorities Balakrishna Udayar v. Vasudeva Aiyar (L.R. 44 I.A. 261), Rajah Amir Hassan Khan v. Sheo Baksh Singh (L.R. 11 I.A. 237) and Joy Chand Lal Babu v. Laksha Chaudhury (L.R. 76 I.A. 131) were distinguished, and that Manindra Land and Building Corporation v. Bhutnath Bannerjee ([1964] 3 S.C.R. 495) was also considered. The judgment concerned Civil Appeal No. 470 of 1963, which was taken on special leave from a judgment and decree dated 14 August 1962 rendered by the Gujarat High Court in Revision Application No. 425 of 1960. Counsel for the appellant comprised S.T. Desai, B. Parthasarathy, J.B. Dadachanji, O.C. Mathur and Ravinder Narain, while counsel for the respondent was N.C. Chatterjee and M.V. Goswami. The judgment was delivered on 22 October 1963 by Justice Shah. Haji Gulamnabi Haji Safibhai, referred to as “the plaintiff,” owned certain premises located in the town of Baroda. Vora Abbasbhai, referred to as “the defendant,” occupied those premises as a tenant and paid a monthly rent of Rs 70. By a notice dated 1 December 1956, which was served on 3 December 1956, the plaintiff demanded that the defendant deliver possession of the premises, alleging that the defendant had failed to pay rent since 1 October 1955. In a letter dated 7 December 1956, the defendant contended that he had paid rent at the agreed rate up to 1 April 1956, that he was entitled to a credit of Rs 200 for costs he incurred for electrical installation in the premises with the plaintiff’s consent, and that the rent stipulated by the plaintiff was excessive.

Subsequently, on 5 January 1957 the defendant filed an application before the Civil Judge, Junior Division, Baroda under section 11(1) of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 (referred to as “the Act”). The application sought an order fixing the standard rent applicable to the premises he occupied and also an order under section 11(3) specifying an interim rent pending fixation of the standard rent. By a letter dated 7 January 1957 the defendant informed the plaintiff of this application, invited the plaintiff to appear before the court, and expressed his willingness to pay any amount that the court might order. On 8 January 1956 the defendant deposited Rs 500 in the court registry to the credit of the plaintiff. On 27 January 1957 the plaintiff instituted a suit before the same Civil Judge, Junior Division, Baroda, seeking a decree of ejectment on the ground of non‑payment of rent. On 14 February 1957 the defendant moved the court for an order specifying the rate at which interim rent could be deposited while the standard rent of the suit property remained unsettled. In that application the defendant explained that the dispute between the parties related to fixation and payment of the standard rent and, without prejudice to his other contentions, he was ready to deposit the amount ordered by the court. On the same day the Civil Judge issued an order directing the defendant to deposit the arrears at the rate of Rs 51 per month and to make the deposit within fifteen days of the order. The judgment proceeds to consider the consequences of that order.

According to the order, the defendant deposited Rs 200 on 2 March 1956 to the credit of the plaintiff and, from time to time, deposited various other sums. By 11 February 1958 the total of these deposits, when the earlier amount of Rs 500 placed on 8 January 1956 was taken into account, amounted to Rs 1,479. No further action appears to have been taken in the defendant’s application under section 11 for the fixation of standard rent; instead, that proceeding was merged with the suit because the question of the appropriate standard rent also needed to be resolved in the suit. On 28 March 1958 the Civil Judge dismissed the plaintiff’s claim for a decree of ejectment. The Court held that the standard rent for the premises was Rs 50 per month, that the defendant had paid the stipulated rent up to 1 April 1956, and that the defendant was entitled to a credit of Rs 150 for expenditures, with the plaintiff’s consent, on electrical installation in the premises he occupied. Considering the aggregate amount deposited, the Court concluded that the defendant could not be evicted for non‑payment of standard rent and, in any event, found that the defendant was ready and willing to pay the amount of standard rent and any permitted increases as defined in section 12(1) of the Act. On appeal, the District Court held that the proper standard rent for the premises was Rs 70 per month, that the defendant had not paid rent since 1 October 1955, and that the defendant was not entitled to claim credit for the Rs 150 spent on electrical installation. Nevertheless, the learned judge observed that by depositing, in accordance with the order of the Court of First Instance, the interim rent as directed, the defendant had complied with the requirements of section 12(3)(b) and had otherwise demonstrated his readiness and willingness to pay the standard rent and any permitted increases. Accordingly, the District Court affirmed the trial court’s decree insofar as it related to the claim for possession, but it modified the decree with respect to the quantum of standard rent and the consequent adjustment of the sums deposited in Court. The High Court of Gujarat, exercising jurisdiction under section 115 of the Code of Civil Procedure, reversed the District Court’s decree and ordered the defendant to deliver vacant and peaceful possession of the premises to the plaintiff within four months of the order. The High Court held that, at the date of the suit, the defendant was not ready and willing to pay the standard rent and permitted increases and had failed to comply with the requirements of section 12(3)(b) of the Act because he had not deposited in Court the amount of standard rent at the rate fixed by the District Court’s order and had not paid even the interim rent at the rate prescribed.

The Court observed that the defendant had failed to deposit with the Court the standard rent determined by the decree of the Court of First Instance, had not paid any interim rent fixed by that decree, and had also failed to pay the costs of the suit that he was required to pay under section twelve three (b) of the Act. Section twelve one of the Act, subject to the limited provisions contained in section thirteen, grants protection to tenants. It provides: “A landlord shall not be entitled to the recovery of possession of any premises so long as the tenant pays, or is ready and willing to pay, the amount of the standard rent and permitted increases, if any, and observes and performs the other conditions of the tenancy, in so far as they are consistent with the provisions of this Act.” The Court explained that this provision applies to a tenant who continues to occupy the premises after the contractual tenancy has been determined; it does not give a landlord the power to evict a contractual tenant without a determination of that tenancy. Accordingly, even after the contractual tenancy is determined, the tenant may claim protection from eviction provided he pays, or is ready and willing to pay, the standard rent and any permitted increases and complies with the other conditions of the tenancy that are consistent with the Act. The premises under dispute are located in the former State of Baroda. By virtue of section three of the Bombay Merged States (Laws) Ordinance six of 1949 and the Bombay Act four of 1950, known as the Bombay Merged States (Laws) Act, 1950, the Bombay Rents, Hotel and Lodging House Rates (Control) Act, LVII of 1947 was extended to the territory of Baroda. Under this extension, the definition of “standard rent” for any premises, whether residential or non‑residential, was set out in section five clause one ten A. The clause states: “‘Standard rent’ in relation to any premises let for the purpose of residence or for non‑residential purpose means: (a) where the standard rent is fixed by the Controller under the House Rent Control Order, 1947, made by the Baroda Government, such standard rent, or (b) where the standard rent is not so fixed, subject to the provisions of section eleven‑ (i) the rent at which the premises were let on the specified date, or (ii) where they were not let on the specified date, the rent at which they were last let before that date, or (iii) where they were first let after the specified date, the rent at which they were first let, or (iv) in any of these cases specified in section eleven, the rent fixed by the Court: Provided that an increase in rent made in operation immediately before the thirtieth day of July 1949, in accordance with the provisions of the said House Rent Control Order, 1947, shall be deemed to be included in the standard rent.” The term “specified date” was defined in clause ten as meaning the first day of January 1943 for premises let for residential purposes and the first day of January 1944 for premises let for non‑residential purposes.

In this matter the Court explained that when the standard rent is not fixed under element (a) of sub‑section (10A) of section 5, a party must ordinarily approach the Court for fixation of the standard rent pursuant to section 11 of the Act. Section 11 contains a provision that, in any of several circumstances, the Court may, upon an application made for that purpose or in any suit or proceeding, determine the standard rent at such amount that, having regard to the provisions of the Act and the specific circumstances of the case, the Court considers just. The circumstances listed include: (a) where premises are first let after the first day of September 1940 and the rent at which they are let is, in the Court’s opinion, excessive; (b) where the Court finds insufficient evidence to ascertain the rent at which the premises were let in any of the situations described in sub‑clauses (i) to (iii) of clause (b) of sub‑section 10 of section 5; (c) where, because the premises have been let at one time as a whole or in parts and at another time in a different manner, or for any other reason, a difficulty arises in giving effect to the relevant part of the statute; (d) where any premises have been let rent‑free, at a nominal rent, or for some consideration in addition to rent; or (e) where there exists a dispute between landlord and tenant concerning the amount of the standard rent. Sub‑clause (2) provides that if there is a dispute concerning the amount of permitted increases, the Court may determine that amount. Sub‑clause (3) mandates that if a tenant, having received a notice from the landlord under sub‑section 2 of section 12, makes an application for fixing the standard rent or for determining the permitted increases, the Court shall promptly issue an order specifying the rent or permitted increases to be paid by the tenant pending the final decision of the application, and that a copy of such order shall be served upon the landlord. The Court noted that, because of an oversight, the section has not been amended to align the merged territory of Baroda with the provisions of the Bombay Act IV of 1950; the reference in clause (b) should have been to sub‑section (10A) rather than sub‑section (10), which is merely a drafting error. Consequently, Section 11 authorises the Court to fix the standard rent on an application made for that purpose or in any suit or proceeding when such fixation is necessary for the determination. The Court emphasized that the standard rent is fixed at an amount deemed just after considering the Act’s provisions and the case’s circumstances, while clause (2) empowers the Court to fix the amount of permitted increases, and clause (3) obliges the Court to issue an interim rent order when a tenant applies for fixation after receiving the appropriate notice.

In this matter the Court explained that once a tenant had received a notice under section twelve, sub‑section two, the Court was required to issue an order that identified the rent amount that could be described as interim rent, to be paid while the final determination of the standard rent was pending. The Court described the purpose of this rule as being plainly intended to stop a tenant from using an application for fixation of standard rent as an excuse for refusing to pay any rent to the landlord. However, the Court emphasized that an order made under sub‑section three only set the amount of rent that was payable during the interim period and did not constitute a fixation of the standard rent as defined in section five, sub‑section ten‑A, clause four. The Court further observed that the protection afforded by sub‑section zero of section twelve was limited by the provisions of section thirteen and also by various procedural and substantive restrictions that were contained within section twelve itself. The Court then quoted sub‑section two of section twelve, which stated that no suit for recovery of possession could be started by a landlord on the ground of non‑payment of the standard rent or permitted increases until one month had passed after a written notice, in the manner prescribed by section one‑zero‑six of the Transfer of Property Act, 1882, demanding the amount of standard rent or permitted increases. This provision, the Court held, created a restriction on the landlord’s right to bring an ejectment action by obliging the landlord to give the tenant an additional opportunity to settle the rent that was due.

The Court proceeded to discuss clause three, sub‑clause (a) of section twelve, which set out the circumstances under which a tenant would lose the protection provided by the statute. According to the wording of that sub‑clause, where rent was payable on a monthly basis, there was no dispute about the amount of standard rent or permitted increases, and the rent or increases were in arrears for six months or more, and the tenant failed to make payment within one month after the notice mentioned in sub‑section two, the Court was required to pass a decree for eviction in any suit for recovery of possession. The Court interpreted the word “may” in that context as having mandatory effect, meaning that once the conditions were satisfied, the Court was bound to grant an eviction decree against the tenant, citing the precedent set in Bhaiya Punyalal Bhagwandin v. Bhagwatprasad (1). The Court then examined sub‑clause (b) of the same section, which provided that in any other case no decree for eviction could be issued if, on the first day of hearing or on any other date fixed by the Court, the tenant paid or tendered in Court the standard rent and permitted increases that were due, continued to do so regularly until the suit was finally decided, and also paid the costs of the suit as directed by the Court. The Court clarified that this sub‑clause applied to cases that did not fall within the scope of sub‑clause (a), thereby outlining the protective mechanism for tenants in situations not covered by the earlier provision.

The provision covers three categories of tenancy situations. The first category comprises cases where the rent is not payable on a monthly basis. The second category includes cases in which there is a dispute concerning the amount of the standard rent and any permitted increases. The third category refers to cases in which the rent has been unpaid for a period of six months or more. In each of these categories the tenant is entitled to claim the protection granted by the statute provided that the tenant pays or tenders to the Court, on the first day of hearing of the eviction suit or on any other date that the Court may fix, the full amount of the standard rent together with any permitted increases. The tenant must continue to make such payments or tenders regularly to the Court until the suit is finally decided, and must also pay the costs of the suit if the Court directs such payment.

To satisfy the condition imposed by clause (b) of sub‑section (3) the tenant is required to pay only the standard rent and the permitted increases; the Court’s authority under clause (b) of sub‑section (1) is limited to fixing the date on which the payment or tender must be made and does not extend to fixing the rate of the standard rent. The power to determine the appropriate standard rent for the premises is vested solely in section 11(1) of the Act. Consequently, in order to bring a claim within section 12(3)(b) the tenant must make payment or tender of the standard rent and the permitted increases on or before the first day of the hearing, or on any other date fixed by the Court, and must also pay the costs of the suit if the Court so directs. The statute imposes an obligation on the tenant to pay or deposit the cost amount only when the Court orders it; there is no unconditional requirement to deposit costs together with arrears of rent. The High Court’s observation to the contrary—stating that the tenant must deposit costs along with arrears of standard rent and permitted increases to claim protection—has been held by this Court to be erroneous.

Nevertheless, practical difficulties may arise in applying clause (3)(b). When there is no dispute regarding the amount of the standard rent or the permitted increases, but the rent is not payable monthly or is not in arrears for six months, the tenant can obtain the protection of the clause simply by paying or tendering the standard rent and permitted increases to the Court and continuing to do so until the suit is finally decided. In contrast, where a dispute exists as to the standard rent, the tenant cannot be expected to make the required payment on the first day of hearing because the amount is not yet determined. Fixing an alternative date for payment would be ineffective until the dispute is resolved and a standard rent is fixed. In such circumstances the Court, upon an application by the tenant, will first resolve the dispute concerning the standard rent. Once the Court fixes the appropriate standard rent, it will then require the tenant to pay or tender that fixed amount on or before a date that the Court thereafter specifies.

In this case the Court explained that when a date for fixing the standard rent has been determined, the tenant must pay the amount fixed on or before that date and must continue to pay or tender that amount regularly until the suit is finally decided. By meeting this requirement the tenant becomes entitled to the protection provided by clause (3)(b). The Court further held that if, on an appeal against the decree, the standard rent is increased, the appellate Court may set a date by which the tenant must pay the difference. If the tenant pays the difference on or before the stipulated date, the condition imposed by section 12(3)(b) is satisfied. Clause (4) empowers the Court to direct that part of the amount paid or tendered by the tenant be applied to the landlord as rent or permitted increases, in such proportion as the Court deems appropriate. The Court then read an Explanation attached to the statute, which states that where there is any dispute about the amount of standard rent or permitted increases recoverable under the Act, the tenant shall be deemed ready and willing to pay that amount if, within one month after the notice referred to in sub‑section (2), the tenant files an application to the Court under subsection (3) of section 11 and thereafter pays or tenders the rent or permitted increases specified in the Court’s order. The Explanation thus creates a rule of evidence. Accordingly, after the landlord serves the notice to the tenant under sub‑section (2) of section 12, if the tenant files an application under sub‑section (3) of section 11 before the expiry of the one‑month period and subsequently pays or tenders the interim rent ordered by the Court on a regular basis until the suit is disposed, the Court must presume that, on the date of the decree, the tenant was ready and willing to pay the standard rent and the permitted increases. Section 12(3)(b) requires payment of the standard rent, not the interim rent, and the term “standard rent” cannot be equated with the “interim rent” fixed under section 11(3). While compliance with an order for interim rent, as described in the Explanation to section 12, serves as conclusive evidence of the tenant’s readiness and willingness to pay the standard rent, such compliance alone does not convert the interim rent into the standard rent fixed under sub‑section (1) of section 11. The statute indeed obliges the tenant to pay or tender in Court the standard rent at the rate that may still be fixed by a Court order, and that order itself may be varied or modified by a superior Court. Nevertheless, this does not permit departing from the statutory definition of “standard rent.” The legislature has therefore set specific conditions for a tenant to qualify for protection of his occupation, and a key condition is the tenant’s readiness and willingness to pay the standard rent and any permitted increases.

In this case the Court explained that proof of a tenant’s readiness and willingness to pay the standard rent could be established by obtaining a court order fixing the rate of standard rent and complying with that order, by complying with the Explanation to section 12, or by other means that demonstrated such willingness. The Court observed that the claim made by the defendant fell within the terms of section 12(3)(b) and not within section 12(3)(a). The defendant, in his reply dated 7 December 1956 to the notice served by the plaintiff, contended that the contractual rent was excessive; he raised the same contention in the application filed for fixation of standard rent and also in his written statement filed in the suit. The Court found that nothing in section 12 supported the plaintiff’s counsel’s contention that a dispute concerning the standard rent contemplated by clause (b) of sub‑section (3) had to be raised before service of the notice under section 12(2), and that the overall tenor of the provision opposed such an interpretation. The Court further held that the District Court was apparently in error when it assumed that by tendering rent in Court at the rate specified in the order dated 14 February 1957 the requirement of section 12(3)(b) regarding payment or tender of standard rent was satisfied. For the purpose of section 12(3)(b), standard rent is rent that is already determined or may be finally determined under section 11(1). It later emerged that the amount deposited by the defendant pursuant to the court order was not less than the amount fixed by the trial court. Nevertheless the defendant did not continue to pay rent regularly until the suit was finally decided, and that failure deprived him of the protection provided by section 12(3)(b). The District Court subsequently enhanced the standard rent to Rs 70 and directed that the standard rent be adjusted against the amount paid in Court; although the Court did not strictly follow the legal requirements, the defect was merely technical. The Court noted that before disposing of the appeal the District Court should have fixed a date for payment of the difference between the standard rent due and the amount actually deposited in Court. The District Court also held that the defendant had otherwise established his readiness and willingness to pay the standard rent. Consequently the question arose whether the High Court possessed jurisdiction to set aside the District Court’s order in exercise of its powers under section 115 of the Code of Civil Procedure. The District Court, on an erroneous view of section 12(3)(b), had held that the requirements of that provision were satisfied by the defendant and, having regard to the circumstances, that the readiness and willingness contemplated by sub‑section (t) was established. The High Court, exercising powers under section 115 of the Code of Civil Procedure, had no authority to set aside the order merely because it was of the opinion that the District Court’s judgment was vulnerable to attack on the ground of an error of fact.

In this matter, the Court explained that the authority to hear the suit was granted to the Subordinate Judge by section 28(1)(b) of the Act, and that any decree or order issued by that Subordinate Judge was, according to section 29(1)(b), appealable to the District Court of the district where the Subordinate Judge performed his duties; however, any further appeals were barred by subsection (2) of section 29. The Court further noted that although the High Court retained the power conferred on it by section 115 of the Code of Civil Procedure, the statute placed very narrow limits on how that power could be exercised. Specifically, the High Court could intervene in revision only when it appeared that a Subordinate Court, in a case where no normal appeal existed, had either exercised a jurisdiction that the law did not grant it, had failed to exercise a jurisdiction that the law did confer, or had acted illegally or with material irregularity while exercising its jurisdiction. The Court quoted the Privy Council’s observation in Balakrishna Udayar v. Vasudeva Aiyar(1), stating that section 115 of the Code of Civil Procedure concerns jurisdiction alone, addressing irregular or improper exercise of jurisdiction or illegal assumption of it, and does not target conclusions of law or fact where jurisdiction is not at issue. Consequently, the Court held that if the Trial Court possessed jurisdiction to decide a particular question and actually decided it, the Court’s jurisdiction remained intact regardless of whether the decision was correct; a mistaken ruling did not amount to illegal exercise or material irregularity, as reflected in Rajah Amir Hassan Khan v. Sheo Baksh Singh(2). Counsel for the plaintiff argued that the District Court, by refusing to grant a decree for ejectment, had declined to exercise a jurisdiction that the law vested in it, thereby invoking clause (b) of section 115. In support, counsel cited Joy Chand Lal Babu v. Laksha Chaudhury and others(3). In that precedent, a Subordinate Judge dismissed an application under sections 30 and 36 of the Bengal Money‑Lenders Act on the basis that the loan was commercial and therefore outside the Act, yet the Judge nevertheless examined whether the underlying suit fell within the Act’s scope and concluded that it did. The Calcutta High Court set aside that order, and the Privy Council affirmed the High Court’s view, holding that once the Subordinate Judge found the loan to be commercial, he was bound to dismiss the application without further inquiry into the suit’s applicability. Sir John Beaumont, when discussing the High Court’s power, observed that there have been many decisions of Indian High Courts on section 115, and that while an erroneous decision of a Subordinate Court does not automatically constitute illegal or irregular exercise warranting revision under subsection (c), a situation where the error leads the Subordinate Court to assume a jurisdiction not granted to it or to refuse a jurisdiction granted to it does give rise to a revision case under subsections (a) or (b), allowing subsection (c) to be disregarded.

The Court observed that a very large number of decisions of Indian High Courts have considered section 115, and that many of those decisions were cited by the judges. It was pointed out that some of those decisions suggest that High Courts have not always recognised that an error in a decision of a Subordinate Court does not automatically mean that the Subordinate Court acted illegally or with material irregularity sufficient to justify interference in revision under sub‑section (c). Nevertheless, the Court explained, if the erroneous decision leads the Subordinate Court to exercise a jurisdiction that is not vested in it by law, or to fail to exercise a jurisdiction that is vested in it, then a case for revision arises under sub‑section (a) or sub‑section (b), and sub‑section (c) may be disregarded.

The Court then referred to the distinction drawn by the Privy Council between two classes of cases. In the first class, a wrong decision results in the Court either assuming jurisdiction that it does not possess or refusing to exercise jurisdiction that it does possess. In the second class, the Court, while exercising its proper jurisdiction, arrives at a conclusion that is erroneous in law or fact. The Court stated that revisional jurisdiction of the High Court is permissible in the former class of cases, but not in the latter. This principle had been highlighted by this Court in Manindra Land and Building Corporation v. Bhutnath Bannerjee and others, where, after quoting the earlier passage and another passage from the judgment in Joy Chand Lal’s case, the Court observed that the earlier remarks did not apply to the present facts. The Court explained that those remarks applied to situations where the law expressly removes the Court’s jurisdiction to try a particular dispute, and not to situations where no such statutory ouster exists, leaving it to the Court to determine certain matters as a result of its own discretion. The Court clarified the distinction: in the first category the Court decides a question of law concerning jurisdiction and, by mistake, either grabs jurisdiction it lacks or refuses to use jurisdiction it has; in the second category the Court decides a question that lies within its jurisdiction. In the present matter, the Court held that the question of whether there was sufficient cause was exclusively within the Court’s jurisdiction, and the Court could determine it correctly or incorrectly.

The Court further noted that Section 12(1) does not affect the Court’s jurisdiction to entertain and decide an ejectment suit against a tenant. Section 12(1) merely provides a protection to a tenant when certain conditions are satisfied, and clauses (2) (3) (a), (3) (b) and the accompanying Explanation address specific situations in which a tenant’s readiness and willingness to pay the standard rent may be presumed or deemed proved. Consequently, the decision of the District Court that the tenant either established or failed to establish his readiness and willingness to pay the standard rent does not affect the Court’s jurisdiction conferred by law.

In this case the Court held that an erroneous determination as to whether a tenant is entitled to the statutory protection does not alter the jurisdiction that the law has vested in the Court. The Court explained that, even if a judgment incorrectly finds that a tenant is or is not entitled to protection, the Court is not assuming a jurisdiction that it does not possess, nor is it refusing to exercise a jurisdiction that has lawfully been assigned to it. Moreover, the Court stated that reaching an incorrect conclusion on the tenant’s claim that he is ready and willing to pay the standard rent does not constitute an illegal act or a material irregularity in the performance of its jurisdictional functions. Consequently, the Court found that the High Court had erred in overturning the decree of the District Court while exercising its revision powers under section 115 of the Code of Civil Procedure. The appeal was therefore allowed and the order issued by the District Court was restored. The Court further directed that, if any standard rent has been deposited since the District Court’s order, that amount should be paid to the plaintiff at a rate of seventy rupees per month. Considering the circumstances, the Court ordered that no costs be awarded in this appeal. Accordingly, the appeal was allowed.