Khadi Gram Udyog Trust v. Shri Ram Chandraji Virajman Mandir Sarsaiya Ghat, Kanpur

KAILASAM, J.-On November 8, 1977 when the hearing of tbe appeal was concluded we pronounced an order dismissing the appeal with costs stating that a-reasoned judgment would follow. We now proceed to give our reasons.

This appeal by special leave is preferred by Khadi Gram Uctyog Trust, the tenant against the judgment of the Allahabad High Court passed in Civil Revision No. 2217 of 1975 directing its eviction. The respondent Shri Ram Chandraji Virajman Mandir, Sarsaiya Ghat, Kanpur, the owner of premises No. 49/4 General Ganj, Kanpur, serv-ed a notice on the appellant who was a tenant of a shop in the premises on a monthly rent of Rs. 200/- from 1958 demanding payment or. arrears as well as to quit the premises. The notice was served on 9th July, 1973. Subsequently the respondent filed the suit No. O.S.5 of 1973 before the District Judge, Kanpur, restricting its claim for recovery of arrears of rent from 1-5-1973 to 8-8-1973 for Rs. 3200/- as damages and Rs. 322.93 as water tax alleged to be already due and Rs. 50 as water tax tentatively due pendente lite and future water tax and for ejectment of the petitioner from the suit premises. In this suit the respondent relinquished his claim for rent for the period 1.1.1963 to 31.12.1970 as the relief was time-barred. The appellant paid the rent for the period 1.1.1971 to 30.4.1973 and thereafter res-pondent restricted his claim for the period 1.5.1973 to 8.8.1973. The appellant filed the written statement stating that he had paid the entire ~mount due. As the rent for the period 1.1.1963 to 31.12.1970 was barred by time, he pleaded that he was not a defaulter and was there-fore not liable to be evicted from the suit premises. The appellant deposited a sum of Rs. 5972.43 in the Court being the amount of rent and damages for the period 1.5.1973 to 28.2.1975 together with in-terest, cost etc. as required by section 20(4) of the U.P. Act 13 ot 1972. The suit was trainsferred to the Court of 6th Addi. District Judge, Kanpur, who on 11.11.1975 decreed the suit of the respondent and directed the appellant to vacate the suit premises and ordered that the entire amount deposited by appellant in the Comt under section 20(4) of the Act shall be paid to the plaintiff-respondent. The ap-pellant filed a revision petition under section 25 of the Small Causes Courts Act in the High Court of Allahabad. The High Court dismis-sed the revision petition by its judgment and order dated 19.4.1977. The present appeal is filed by special leave granted by this Court.

The only contention raised in this appeal is that the appellant hav-ing complied with the requirement of section 20( 4) of the Act and deposited the entire amount of rent due, the Court ought to have passed an order relieving the tenant against his liability for eviction on that ground. Chapter IV of the U.P. Urban Buildings (Regula-tion of Letting, Rent and Eviction) Act XIII of 1972 prescribed the procedure for eviction of a tenant. While section 20(1) bars insti-tution of suit for eviction of a tenant from a building notwithstanding the determination of his tenancy by efflux of time or ~11 the expiration of a notice to quit or in any other manner, sub-section (2) enables the landlord to file a suit on any one or more ot the grounds mentioned m sub-section (2). We are concerned with sub-clause (a) of sub-sec-tion (2) which provides that a suit for eviction of a tenant from a building may be instituted on the ground that the tenant is in arrears of rent for not less than four months and has failed to pay the same t'? the Jandlo~d 'Yithin one month. from the date of service upon him of a notice of demand. It 1s not disputed that several notices were served on the appeHant and that he failed to pay the reiu within one month from the date of the service of the notice of demand on him. Another opportunity for payment of rent is provided to the tenant under section 20( 4) which provides that "In any suit for eviction on the ground mentioned in clause (a) of sub-section (2), if at the first hear-ing of the suit the tenant unconditionally pays or tenders to the land-lord 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 9 per cent per annum and the landlord's costs of the suit in respect thereof, after deducting any amount already deposit-ed by the tenant under sub-section ( 1) of section 30, the court may, m lieu ot passing a decree for eviction on that ground, pass an order relie· ving the tenant against his liability for eviction on the ground. Under this sub-<Section, therefore, though the tenant has not complied with the requirement of sub-section (2) of section 20, if he pays at the first hearing of the suit unconditionally the entire amount of rent the court may pass an order relieving the tenant against this liability for evic-tion. In this case the appellant deposited on 13-2-1975 a sum of Rs. 5972.43 being the amount of rent and damages for the period 1.5.1973 to 28.2.1975 together with interest etc.. The contention of the appellant is that "entire amount of rent due" would be the rent that is recoverable and would not include the rent, the recovery for which is barred by time. According to the appellant the payment of entire amount of rent due would not include the rent for the period 1.1.1960 to 31.12.1970 as the claim is barred by time. The District Judge who tried the suit was of the view that the tenant ought to have deposited the time-barred arrears of rent also in order to claim benefit under section 20(4). The trial Court proceeded with the trial of the suit and found that the landlord had proved that tenant was in arrears of rent for not less than 4 months and had failed to pay the same to the landlord within one month from the date of ser-vice upon him of a notice of demand and as such satisfied the require-ment of sub-section (2) of section 20 and is entitled for order of eviction. In the revision the High Court affirmed the view taken by th" trial Court and dismissed the appeal.

It will be seen that under section 20(2) of the Act, the landlord gets a cause of action for evicting the tenant when the tenant is in arrears of rent for not less than four months, and has failed to pay the same to the landlord within one month from the date of service upon him of a notice of demand. If the tenant pays the entire arrears of rent due at the first hearing of the suit the court may relieve the tenant against eviction even though he had not complied with section 20(2). The tenant can take advantage of the benefit con· ferred by section 20(4) only when he pays the entire amount of rent due as required under section 20 ( 4). The question that arises for consideration in this appeal is whether the entire amount of rent due would include even rent which cannot be recovered as having been time-barred. There is ample authority for the proposition that though a debt is time-barred, it will be a debt due though not recover-able, the relief being barred by limitation. In Halsbury's Laws of England (3rd Ed.) Vol. 24 at p. 205, Article 369, it is stated "except in the ca·ses previously mentioned, the Limitation Act, 1939 only takes away the remedies by action or by set off; it leaves the right otherwise untouched and if a creditor whose debt is statute-barred has any means of enforcing his claim other than by action or set-off, the Act does not prevent him from recovering by those meani. The Court of Appeal in Curwen v. Milburn (1889) 42 Ch. D. 424 Cotton, L. J. said :

"Statute-barred debts are dues, though payment of them cannot be enforced by action."

The same view was expr~ed by the Supreme Court in Bombay Dye-ing and Manufacturing Co. Ltd. v. The State of Bombay & Others(') where it held that the statute of limitation only bars the remedy but does not extinguish the debt, except in cases provided for by section 28 of the Limitation Act, which does not apply to a debt. Under sec-tion 25 ( 3) of _the Contract Act a barred debt is good consideration for a fresh pro_mise to pay the amount. Section 60 of the Contract Act provides that when a debtor makes a payment without any direc-tion as to how it is to be appropriated, the creditor has -the right to appropriate it towards a barred debt. In a full Bench decision of the Patna High Court Ram Nandan Sharma and Anr. v. Mt. Maya Devi and Others("), Untwalia, C. J. as he then was, has stated "There is a catena of decisions in support of what has been said by Tek Chand, J. in First National Bank v. Sant Lal, (A.I.R. 1959 Punj. 328 at p. 330 paragraph 12) that the Limitation Act with regard to personal actions, bars the remedy without extinguishing the right." The Jaw is well-settled that though the remedy is barred the debt iS not extin-guished. On consideration of the scheme of the Act, it is clear that _f the statute has conferred a benefit on the tenant to avoid a decree for

eviction by complying with the requirement of section 20(4). If he fails to. avail himself of fhe opportunity and has not paid the rent for not less than four months and within one month frnm the date of service upon him of a notice of demand, the landlord under section 20 (2) would be entitled to an order of eviction. Still the tenant can avail himself of the protection by complying with the requiremenfs of section 20( 4). As he has not deposited the entire amount due the protection is no more available. We agree with the view taken by the trial court and the High Court of Allahabad that the words "entire amount of rent due" would include rent which has become time-barred

In the result the appeal is dismissed. There will be no order as to costs.

(t} [1958] S.C.R. 1122.

(2) A.T.R. 1975 Pat. 283.

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1313 of 1977.

Appeal by Special Leave from the Judgment and Order dated 20-5-77 of the Allahabad High Court in Civil Revision No. 2217 of .... 19 7 5. ""'111111

Hardaya/ Hardy, K. L. Taneja and S. K. Sabharwal for the Appel-lant. ·

I. N. Sinha, Badri Das Sharma and S. R. Srivastava for the Res-pondents.