THE HONOURABLE SRI JUSTICE L.NARASIMHA REDDY

Appeal Suit No.213 of 2011

07-06-2011

Taste Hotels Private Limited..

Medisetty Jayasri and another

Counsel for the appellant: Sri Y.V.Ravi Prasad

Counsel for the Respondents: Sri M.R.S.Srinivas

:JUDGMENT:

The appellant is a lessee in respect of a three storied building bearing Door No.5-408 of Ongole Town, owned by the respondents. The lease commenced in May, 2006 with a monthly rent of Rs.50,000/-. The respondents got issued notice, dated 29.03.2007, requiring the appellant to vacate the premises, on the ground that the rents for the period between October, 2006 and November, 2007, were not paid. Thereafter, correspondence ensued between the parties. The respondents, ultimately, filed O.S.No.4 of 2008 in the Court of Additional Senior Civil Judge, Ongole, for the relief of recovery of possession of the suit schedule property. The suit has since been transferred to the Court of VII Additional District Judge, Ongole, and renumbered as O.S.No.105 of 2010.

The respondents filed I.A.No.42 of 2008 under Rule 1 of Order XVA C.P.C. (in its application to the State of Andhra Pradesh) with a prayer to direct the appellant herein to deposit the arrears of rent. The appellant contested the application by stating that a sum of Rs.2,55,000/- was already paid as advance. Other relevant factors were also pleaded. The trial Court passed an order, dated 26.06.2009, in that I.A., by directing the appellant to deposit a sum of Rs.10,50,000/-, as arrears upto June, 2008, after deducting Rs.2,55,000/- already deposited into the Court, within 30 days. Further, a direction was issued to deposit monthly rents from time to time, till the disposal of the suit. Thereafter, several applications were filed by the parties either for extension of the time or for striking off the defence and orders of different purport were passed.

The respondents filed I.A.No.479 of 2010 under Rule 6 of Order XII read with Rule 1 of Order XV(1)(A) and under Section 151 C.P.C. with a prayer to strike off the defence of the appellant herein and to render the judgment as provided for under Rule 6 of Order XII C.P.C. I.A.No.480 of 2010 was filed under Section 151 C.P.C. with a prayer to direct the appellant herein to submit the returns in Form 16-A under Section 203 of the Income Tax Act. The appellant opposed both the applications by raising various grounds of fact and law. Through a common order dated 16.03.2011, the trial Court allowed both the applications and had struck off the defence of the appellant. Simultaneously, it had decreed the suit, through a judgment running into few lines, directing the appellant to vacate the premises within 30 days from the date of the decree. Hence, this appeal.

Sri Y.V.Ravi Prasad, learned counsel for the appellant, submits that the trial Court committed errors of fact and law in decreeing the suit. He contends that an application under Rule 1 of Order XVA C.P.C. was filed by the respondents, and in compliance with the orders passed therein, the rents are being deposited from time to time. He submits that there was no justification or basis for filing an application by invoking two different provisions, namely, Rule 6 of Order XII and Rule 1 of Order XVA C.P.C. According to him, these provisions operate in different fields, and there does not exist any scope for applying both the provisions for one and the same situation. Learned counsel further submits that the admission contemplated under Rule 6 of Order XII C.P.C. must be unequivocal either in the pleadings or in the course of trial and that no such admission ensued in the instant case.

Learned counsel further contends that even where a defendant remains ex parte, the trial Court is under obligation to render judgment on merits, and that the decree passed by the trial Court is contrary to the judgment rendered by the Hon'ble Surepeme Court in Balraj Taneja v. Sunil Madan1, which, in turn, was followed by this Court in Kedarisetti Atmaram v. N.Seetharama Raju2. He further submits that in a suit filed for the relief of eviction by invoking Section 106 of the Transfer of Property Act, the existence or otherwise of arrears of rent, hardly matters and a suit cannot be decreed on that basis alone.

Sri M.R.S.Srinivas, learned counsel for the respondents, on the other hand, submits that the trial Court recorded a clear finding to the effect that the appellant admitted the existence of arrears of rent and that in turn resulted in striking off of the defence under Order XVA. He contends that once the defence is struck off and there is a clear admission, attracting Rule 6 of Order XII, it was not only competent for the trial Court, but also is its obligation to decree the suit as prayed for. He submits that the power of the Court to render judgment as provided under Rule 6 of Order XII is wide enough and in support of his contention he places reliance upon the judgment of the Supreme Court in Uttam Singh Dugal and Company v. Union Bank of India3; Karam Kapahi v. Lal Chand Public Charitable Trust4 and the judgment of the Delhi High Court in Parivar Seva Sansthan v. Dr. (Mrs.) Veena Kalra5. Reference is also made to a judgment of this Court in Sangitaagrawal v. Sneha Pusph Traders Private Limited6.

The relationship between the appellant on the one hand and the respondents on the other hand, as lessee and lessors, is not disputed. A lease deed was executed on 30.11.2006 stipulating the conditions, though the lease commenced with effect from 01.05.2006. While the respondents got issued a notice alleging default in payment of rents, the appellant replied with a denial. Further correspondence ensued and ultimately the respondents filed the suit with a prayer to direct the appellant herein to vacate the suit schedule property.

Order XVA was introduced into C.P.C. through the A.P. State amendment. It enables the plaintiff in a suit for recovery of possession of an immovable property from a lessee, to insist on deposit of rents, along with the written statement. Once an order is passed directing the defendant in such a suit to deposit the arrears of rent, non-compliance with it, would entail in striking off of the defence.

The respondents filed I.A.No.42 of 2008 under that provision, and orders thereon were passed on 26.06.2009. That in turn was followed by filing certain other applications for extension of time etc.

The respondents filed I.A.No.479 of 2010 by invoking Rule 6 of Order XII read with Order XV(1)(A) and under Section 151 C.P.C., with a prayer to render judgment in the suit itself. In addition to that, they filed I.A.No.480 of 2010, with a prayer to direct the appellant to file copies of returns in Form- 16-A under Section 203 of Income Tax Act. On contest, these applications were ordered. That in turn resulted in decreeing of the suit. It is not known as to whether the appellant filed revisions or appeals as the case may be, against the orders in I.A.Nos.479 and 480 of 2010.

The judgment rendered by the trial Court for decreeing the suit, reads as under:

"As per orders in I.A.No.479 of 2010 dated 16.03.2011, the defence of the defendant is struck of and the suit is decreed with costs directing the defendant to vacate the plaint schedule property and inform the same to the plaintiffs, within 30 days fro the date of this judgment, failing which the plaintiffs can evict the defendant through Court, by executing the decree."

This appeal is against the judgment and decree in the suit. On hearing the learned counsel for the parties, this Court feels that the following points arise for consideration in this appeal:

a) Whether the admission referred to in Rule 6 of Order XII must be of a fact, which is in issue and an answer to which would entail in grant of relief; b) Whether a prayer made for extension of time for making deposit of the arrears of rent can by itself be treated as default in payment of rents and (i) would constitute admission as contemplated under Rule 6 of Order XII C.P.C. (ii) and entail in striking off the defence under Order XVA; and c) Whether the existence of an admission contemplated under Rule 6 of Order XII or striking off the defence under Rule XVA, would relieve the trial Court, of its obligation to decide the suit on merits.

Points (a) and (b) need to be discussed together.

Since the suit was decreed by invoking Rule 6 of Order XII, there was no occasion for the trial Court to record oral or documentary evidence. It is too well known to be repeated that the proceedings commence in a suit with the presentation of a plaint and the Court would know the actual area of controversy, once the written statement is filed by the defendants. In the ordinary course of adjudication, issues would be framed by the Court, parties are permitted to adduce evidence and judgment is rendered, by taking into account, the arguments advanced on behalf of the parties and by applying the relevant provisions of law. This is the time tested procedure emerging from ancient times. A sloka from Vysa Dharmakosa reads:

"purvottare kriya padam

Pramanam tatpareekshanam

Nigadam smruthivakyam cha

Yadhasabhyam vinischitam

Ethassarvam samasena

Jayapatre abhilekhayeth"

Broadly, the meaning thereof is that a judgment is a document, which incorporates, a) brief statement of the plaint and written statement; b) gist of the evidence adduced by the parties; c) discussion on issues involved; d) consideration of the arguments advanced by the parties; e) reference to the relevant provisions of law; f) the opinion of the judge/judges and f) the royal seal.

Rules 4 and 5 of Order XX C.P.C., to certain extent, cover these aspects.

The necessity to frame the issues, much less to record evidence is obviated in cases where the claim of the plaintiff is admitted by the defendants at the threshold. If the admission is in its entirety, the suit can be decreed as prayed for. On the other hand, if the admission is in respect of part of the claim, judgment to that extent can be rendered and the trial can be undertaken as regards the rest of the claim. Order XII C.P.C. deals with admissions and confers the corresponding power on the part of the Court to render judgment on admissions. Rule 6 thereof reads:

"Judgment on admissions:-

(1) Where admissions of fact have been made either in the pleading or otherwise, whether orally or in writing, the Court may at any stage of the suit, either on the application of any party or of its own motion and without waiting for the determination of any other question between the parties, make such order or give such judgment as it may think fit, having regard to such admissions. (2) Whenever a judgment is pronounced under sub-rule (1), a decree shall be drawn up in accordance with the judgment and the decree shall bear the date on which the judgment was pronounced."

From a perusal of this, it becomes clear that the admission should be of a fact, which naturally must constitute the basis for framing of an issue. It is only an admission of such facts that can entail in a judgment in relation thereto, even while the determination of other questions between the parties may be relegated to a subsequent stage. The word "fact" assumes significance in the context of framing of issues under Order XV. Rule 1 thereof declares that issues arise when material proposition of fact or law is affirmed by one party and denied by the other party. Rule 5 of Order XX C.P.C., mandates that the judgment in a suit shall deal with all the issues framed in it. Because the stage at which the judgment is rendered under Rule 6 of Order XII precedes the stage of framing of issues, reference is made to "fact". Naturally the "fact" must be such that it constitutes the basis for an issue.

In a suit for eviction of a lessee, it is not necessary that the lessee failed to pay the lease amount. Even if he is a person, who pays the rent with utmost promptitude, eviction can be sought just by delivering a notice under Section 106 of the Transfer of Property Act. It is only under the Rent Control Legislations that the default in payment of rents would constitute one of the grounds. Therefore, the admission even if made as to the existence of arrears of rent, cannot be treated as the one of a fact, which has a bearing on the adjudication of suit for eviction. The admission of such a fact is same as admission as to the existence of relationship of lessor and lessee.

Now comes the necessity to understand the purport of the word 'admission' employed in Rule 6. This in fact, is the subject matter of interpretation by the Supreme Court in Uttam Singh Dugal and Company Ltd's case (3 supra), Karam Kapahi's case (4 supra), and the Delhi High Court in Parivar Seva Sansthan's case (5 supra). Their Lordships of the Supreme Court and the Delhi High Court in the judgments referred to above held that the admission need not be confined to the one in pleadings. In fact, the language of the provision itself suggests that it can be either in the pleadings or otherwise. Further, the admissions can be either oral or in writing. The words "orally or in writing" provide guidance to understand the idea succinctly. The admission in writing can be either in a written statement in that very suit, counters, or affidavits in the miscellaneous proceedings and in certain cases the admissions in the pleadings in other proceedings.

In Balraj Taneja's case (1 supra), the Supreme Court held in paras 23, 24 and 25 as under:

"23. Under this rule, the court can, at an interlocutory stage of the proceedings, pass a judgment on the basis of admission made by the defendant. But before the court can act upon the admission, it has to be shown that the admission is unequivocal, clear and positive. This rule empowers the court to pass judgment and decree in respect of admitted claims pending adjudication of the disputed claims in the suit.

24. In Razia Begum v. sahebzadi Anwar Begum7 it was held that Order 12 Rule 6 has to be read along with the proviso to Rule 5 of Order 8. That is to say, notwithstanding the admission made by the defendant in his pleadings, the court may still require the plaintiff to prove the facts pleaded by him in the plaint.

25. Thus, in spite of admission of a fact having been made by a party to the suit, the court may still require the plaintiff to prove the fact which has been admitted by the defendant. This is also in consonance with the provisions of Section 58 of the Evidence Act..."

The oral admission is referable to the stage of examination of parties by the Court at their first appearance, which is dealt with, under Order X C.P.C Rules 2 and 3 thereof become relevant. They read:

"2.Oral examination of party, or companion of party:- (1) At the first hearing of the suit, the court -

(a) shall, with a view to elucidating matters in controversy in the suit, examine, orally such of the parties to the suit appearing in person or present in Court, as it deems fit; and

(b) may orally examine any person, able to answer any material question relating to the suit, by whom any party appearing in person or present in Court or his pleader is accompanied.

(2) At any subsequent hearing, the Court may orally examine any party appearing in person or present in Court, or any person, able to answer any material question relating to the suit, by whom such party or his pleader is accompanied.

(3) The Court may, if it thinks fit, put in the course of an examination under this rule questions suggested by either party.

3. Substance of examination to be written:-

The substance of the examination shall be reduced to writing by the Judge, and shall form part of the record."

If an oral statement or admission is made in the Court, the same shall form part of the record. The statement so recorded can certainly constitute the basis to render judgment under Rule 6 of Order XII C.P.C.

In the instant case, firstly there was no admission as to existence of arrears of rent in the written statement filed by the appellant herein nor was there any admission or a statement equivalent thereto, under Rule 2 of Order X. It was not suggested that in any other pleadings the extent of arrears of rent was pleaded. Hence, point (a) is answered in the affirmative.

An application filed for extension of time to deposit the rents directed by the Court cannot be treated as an admission. At any rate, the so-called admission is not of a fact, which would be genuinely at issue in the suit. The discussion undertaken on point (a) would, to a large extent cover point (b) also. As observed earlier admission must be of a specific fact, on which adjudication is necessary. The very fact that a direction is issued for payment of arrears of rents indicates that there existed arrears. If mere existence of arrears were to constitute the basis for passing a decree for eviction, the entire exercise under Order XV C.P.C. would have become redundant. Further, the determination of the arrears under Order XVA is purely tentative, and the final adjudication, if necessary, has to be undertaken after trial. Therefore, point (b) is answered in the negative and in favour of the appellant.

Now remains the last point.

Rule 6 of Order XII C.P.C., even if fulfilled in all respects would, at the most enable the Court to render a judgment without the ordeal of conducting trial, to the extent of admission. Similarly, the striking off the defence under Order XVA would disarm a defendant in a suit, to a substantial extent. In a way, that would weaken his position. However, he cannot be excluded completely from the picture.

Whether in the event of there being an admission, or the defence having been struck off, the Court would be under obligation to satisfy itself as to the legality of the claim, from the point of view of the maintainability of the suit, limitation, and the like. It is not without reason that Section 3(i) of the Limitation Act places obligation on the Court to satisfy itself about the claim being within limitation, even if no such plea is raised by the defendant. The obligation on the part of the plaintiff to prove the facts pleaded by him would continue to rest upon him notwithstanding the fact that the defence was struck off. A witness would certainly be subjected to cross-examination, may be in a limited context and with reference to the facts spoken to by himself. In Balraj Taneja's case (1 supra), the Supreme Court dealt with in detail the obligation of the Court to discuss the matter on merits, even where a defendant remains ex parte. Incidentally, the Supreme Court took note of Rule 6 of Order XII as well as Rule 10 of Order VIII C.P.C. in laying down the proposition. The relevant portion in para 29 reads as under:

"... Before passing the judgment against the defendant it must see to it that even if the facts set out in the plaint are treated to have been admitted, a judgment could possibly be passed in favour of the plaintiff without requiring him to prove any fact mentioned in the plaint. It is a matter of the court's satisfaction and therefore, only on being satisfied that there is no fact which need be proved on account of deemed admission, the court can conveniently pass a judgment against the defendant who has not filed the written statement. But if the plaint itself indicates that there are disputed questions of fact involved in the case regarding which two different versions are set out in the plaint itself, it would not be safe for the court to pass a judgment without requiring the plaintiff to prove the facts so as to settle the factual controversy. Such a case would be covered by the expression "the court may, in its discretion, require any such fact to be proved" used in sub-rule (2) of Rule 5 of Order 8 or the expression "may make such order in relation to the suit as it thinks fit" used in Rule 10 of Order 8."

The said judgment was followed by this Court in Kedarisetti Atmaram's case (2 supra). In Alka Gupta v. Narender Kumar Gupta8, the Supreme Court held that a suit cannot be short-circuited by deciding issues of fact merely on pleadings and documents produced without a trial and that suit cannot be dismissed without trial merely because the Court feels dissatisfied with the conduct of the plaintiff. Hence, point (c) is answered in the negative.

For the foregoing reasons, the appeal is allowed and the decree under appeal is set aside. The matter is remanded to the trial Court for adjudication in accordance with law.

There shall be no order as to costs.

?1 AIR 1999 SC 3381

2 2011 (1) ALD 426

3 2000 (5) Supreme 425

4 (2010) 4 SCC 753

5 AIR 2000 DELHI 349

6 2009 ALD 5 438