UP Urban Building Act | Tenant Can Deposit Rent In Court Only On Landlord's Refusal To Accept : Supreme Court

The Supreme Court held that Section 30 Uttar Pradesh Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 provides that a tenant may deposit rent in the Court on refusal of the rent by the landlord, but this position only lasts till the landlord expresses his willingness to receive the rent. If the landlord serves formal notice expressing willingness, the tenant upon receipt of notice is under an obligation to tender the rent at least at the rate admitted to the landlord.

A Bench comprising Justice Aniruddha Bose and Justice Sudhanshu Dhulia was deciding a challenge arising out of rent and eviction proceedings from a Small Causes Court. A suit was eviction was allowed by the Small Causes Court which was affirmed by the District Court and later the Allahabad High Court.

Factual Background

In 1982, a premise in the State of UP was rented out on a monthly rent of Rs 165. Later the rent was increased a couple of times to Rs 195, Rs 250 then Rs 300. The tenant denied the claim of the rent being even being increased to Rs 300. It appears that in 1993, the landlord refused to accept the rent paid by the tenant as it was alleged that the tenant was not paying the increased amount. Consequently, the tenant started depositing the rent in the Court of Civil Judge (Junior Division) as per Section 30 of the Uttar Pradesh Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972. Subsequently, the landlord gave a notice to the tenant demanding arrears of rent from 1993 onwards. Since the tenant did not deposit the amount within the stipulated period of time, the landlord filed a suit for arrears of rent and eviction before the Small Causes Court. A decree of eviction and recovery of rent was passed against the tenant. The revision petition before the District Judge and a writ petition before the Allahabad High Court were also dismissed.

The High Court had noted that there was no evidence to show that there existed an oral agreement providing for a periodic increase of rent from Rs 250. In absence of such proof, the High Court found that the correct monthly rent would be Rs. 250. However, it held that once the landlord by way of a notice had expressed willingness to receive rent then the tenant had no option but to deposit the rent before the landlord and not in the Court under Section 30.

Analysis by the Supreme Court

The Supreme Court agreed with the reasoning provided by the High Court. It noted that Section 30(1) contemplates that the rent can be deposited in the Court until the landlord in the meantime signifies by notice in writing to the tenant his willingness to accept it. The Apex Court observed that the tenant can only deposit rent in the Court as long as the landlord refused to accept it. Once the landlord expresses willingness to accept the rent, the tenant ought to deposit the money with the landlord. It further noted that the notice given by the landlord asking for arrears of rent expressed his willingness to accept the rent. In this regard, the Court referred to a judgment of the Full Bench of the Allahabad High Court [Gokaran Singh v. 1st Additional District And Sessions Judge, Hardoi And Ors.] wherein it was held -

“37. (2) If the landlord has been refusing to accept the rent at the correct rate and has been claiming rent at higher rate, the tenant as a consequence of landlord’s earlier refusal in the past, deposited the rent in the Court under Section 30 and if thereafter landlord serves formal notice to of demand against the higher rate and expresses his willingness to accept the rent, the tenant after receipt of notice is under an obligation to tender the rent at least at the rate admitted to him to the landlord and has got no right to straight away deposit the same under Section 30(1) of the Act.”

Case details

Man Singh v. Shamim Ahmad (Dead) Through LRs| 2023 LiveLaw SC 290   |Civil Appeal No. 1874 of 2015| 5th April, 2023| Justice Aniruddha Bose and Justice Sudhanshu Dhulia