P L D 1967 Lahore (PLP)

This second appeal is, by the tenant and has arisen in the following circumstances. The respondent, as the transferee of the property in dispute served a notice 'of transfer on the appellant on the 28th of February 1963, although the transfer had taken place in her favour in 1960. She alleged that the appellant had agreed orally to pay rent at the rate of Rs. 500 p.m., but he had not paid any rent at all until the time of the institution of the application on the 26th of June 1964. She further alleged that he had sublet the property to several persons without her permission. While resisting this application for his ejectment, the appellant raised several preliminary objections, on the basis of which the following issues were framed by Ch. Abdur Rehman Bhatti, Senior Civil Judge at Lahore, acting as Rent Controller:‑ (1) Whether the relationship of landlord and tenant exists between the parties and whether notice under section 30 of Act XXVIII of 1958 was served on the respondent before the filing of this petition? (2) If the second part of issue No. 1 is not proved, what is its effect? (3) Whether the transfer of the property in dispute in favour of the petitioner by the Settlement authorities is illegal and can this objection be raised in this Court? (4) What is the proper description of the property in dispute? (5) Whether the petition has not been properly framed and duly verified?

2. The learned Rent Controller expressed the view that by virtue of section 30 of the Displaced Persons (Compensation and Rehabilitation) Act, 1958 (hereinafter referred to as the Act), statutory relationship of landlord and tenant came to exist between the parties; that the notice served by the respondent landlord was not valid for the reason that it did not make any demand for the payment of rent, nor it specifically mentioned the rate of rent; that the invalidity of the notice had no effect upon the maintainability of the landlord's application on the ground of subletting; that the question of the legality of the transfer could not be inquired into by the Rent Controller; that the property had been properly described by the addition of a plan, and that there was nothing wrong with the verification of the petition. On these findings the learned Rent Controller concluded that the application before him was maintainable and he accordingly fixed a date for further proceedings in the case.

3. Aggrieved by this order the tenant went up in appeal which, was, however, dismissed by the learned District Judge, Lahore, acting as appellate authority under the Ordinance, holding that the protection granted by section 30 of the Act XXVIII of 1958 was not available to a tenant who had sublet the property after its transfer under the Settlement law. It appears that this was the only point agitated in appeal, as there is no discussion on any of the other preliminary issues framed and decided by the learned Rent Controller.

4. In the present second appeal, Mr. Ghulam Mujtaba, the learned counsel for the appellant, has confined himself only to the question of the effect of the invalidity which has been found by the learned Rent Controller to attach to the notice served by the respondent landlord on the present appellant. The contention of the learned counsel is that although by subsection (1) of section 30 of the Act statutory relationship of landlord and tenant is created between the parties on the transfer of the property under the Settlement law, yet that relationship is immune from the application of the ordinary lave for a period of six years from the date of transfer if the notice of transfer is served within one month, or from the date of notice if it is served at a subsequent date; and that this protection cannot be taken away if no valid notice of transfer and demand has been served as required by subsection (3) of section 30 of the Act. It appears to the learned counsel that the service of a valid notice of transfer and demand is an essential prerequisite for invoking the jurisdiction of the Rent Controller for whatever reason, and that in this behalf no distinction can be drawn between the case of a tenant who has defaulted in the payment of rent and that of a tenant who has sublet the property or otherwise parted with its possession or has committed acts which are destructive of, or injurious to, the property. . In support of these contentions the learned counsel has placed reliance on two recent decisions of this Court, namely, Abdul Aziz v. West Pakistan Publishing Company (Private) Ltd. (P L D 1965 Lah. 82) and Muhammad Shafi v. Abdul Hayee (P L D 1965 Lah. 681).

5. In order to appreciate the contention raised in this case it would be well to reproduce here section 30 of the Displaced Persons (Compensation and Rehabilitation) Act, 1958, which runs as under:‑ 30.‑(1) Where any person is in possession of any evacuee house, or shop, or has been declared, on or before the twentieth day of December 1958, by a Custodian to have tenancy rights from a date prior to the fourteenth day of August 1947, in any industrial concern, cinema house or printing press which is transferred to any other person under the provisions of this Act, then, notwithstanding anything contained in any other law, such person shall, without prejudice to any other right which he may have in that house, shop, industrial concern, cinema house or printing press, be deemed to be a tenant of the transferee on the same terms and conditions as to payment of rent or otherwise on which he held it immediately before transfer: Provided that‑ (a) it shall be lawful for the transferee to charge a rent on the basis of the latest assessment carried out by the municipality or local authority, as may be for other properties in the locality generally ; and (b) it shall not be lawful for the transferee to eject such persons from the house or hop for a period of six years, and from the industrial concern, cinema house or printing press for a period of three years from the date of transfer, notice of which shall be given by the transferee to the tenant within one month of such transfer by registered post (acknowledgment due). (2) Where the transferee does not give notice within one month, as required by proviso (b) to subsection (1), the period mentioned in that proviso shall count from the date of receipt of such notice by the tenant. (3) Nothing in proviso (b) to subsection (1) shall apply to a tenant (i) who has not, within three months from the date of receipt of notice of demand sent to him by the transferee by registered post (acknowledgment due), paid or tendered the amount of rent for arrears of rent due for any period after the transfer; or (ii) who, after the transfer, has sublet or otherwise parted with the possession of the house or shop, industrial concern, cinema house or printing press, or any part thereof, or has committed acts which are destructive of or injurious to the property, nor shall anything thing therein apply to the tenant of any house or shop who, in any urban area within the same town or city, owns a house or shop, as the case may be. (4) On the expiry of the period mentioned in proviso (b) to subsection (1), or on the contravention of any of the provisions of subsection (3), whichever is earlier, the relationship of landlord and tenant between the transferee and the tenant shall be regulated in accordance with the law for the time being in force relating to such relationship.

6. It will be seen that by virtue of subsection (1) of section 30 statutory relationship of landlord and tenant is created between the transferee of the property and the person who is in possession of the same either as an old tenant or under an order passed by the Custodian or other competent authority. Of the two provisos attached to the subsection, the first one lays down that it shall be lawful for the transferee to charge rent from the tenant on the basis of the latest assessment, and the second one gives protection from ejectment for a period of six years from the date of the transfer. Subsection (2) of section 30 is really in the nature of an amplification of proviso (b) to subsection (1), inasmuch as it lays down that if the notice of transfer contemplated by the said proviso, is not served within a month of the date of transfer, then the period of protection shall count from the date of receipt of such notice by the tenant. It is significant that the notice mentioned in proviso (b) to subsection (1), as well as in subsection (2) of section 30 is a notice of transfer, and there is no mention in these Provisions of a notice of demand. 7. we now come to subsection (3) of this section, which purports to take away in certain circumstances the protection granted by proviso (b) to subsection (1). Clause (i) of this subsection deals with the case of a tenant who defaults in the payment of rent within three months from the date of receipt of a notice of demand sent to him by the transferee by registered post; and clause (ii) deals with the case of a tenant who sublets or otherwise parts with the possession of the property or does other acts destructive of, or injurious to, the property. The question is whether requirement of notice embodied in clause (i) of this subsection is also to be read into clause (ii) thereof.

8. As already stated, Mr. read Mujtaba has placed reliance on two decided cases of this Court. In the first case, namely that of Malik Abdul Aziz the question before the Court was whether the tenant could be penalised for his default in the payment of rent, when no clear notice of demand has been sent to him by the transferee in accordance with clause (i) of sub section (3) of section 30 of the Act. The learned Judges observed that: "In every case when a landlord, who is a transferee under the Displaced Persons (Compensation and Rehabilitation) Act, 1958, invokes the jurisdiction of the Rent Controller to eject a statutory tenant, he must prove that the provisions of subsection (3) of section 30 have been contravened. These provisions were made to ensure the protection of such tenants for the statutory period of six years. They cannot be ejected like the ordinary tenants by a simple default on their part in the payment of rent. To warrant an action of ejectment against them, it is necessary to give them an opportunity to remedy the default which they would be within their rights to do within three months after the receipt of the registered notice. If the landlord does not give the required notice, there is no contravention of section 30 (3) of Act XVIII of 1958. The landlord, therefore, cannot invoke the jurisdiction of the Rent Controller, under the West Pakistan Urban Rent Restriction Ordinance, 1959." It was further observed that: If a transferee gives a notice to the tenant, without specifying the amount he intends to charge, and asks the tenant to pay rent in accordance with the assessment of the Municipal Committee, it will not be a valid notice of demand within the meaning of section 30(3)(i). There is no obligation on the part of the tenant ipso facto to pay the rent to the transferee in accordance with the assessment of the Municipal Committee. He is liable to pay the rent which he was paying before the transfer. A right, however, is created in the transferee to charge the rent based on the latest assessment carried out by the municipality. Unless the transferee exercises his right there is no corresponding obligation imposed on the tenant to pay that amount. The transferee, under the circumstances, must indicate his intention to do so before he can enforce his claim and complain of default in the context of the proviso."

10. It will be seen that the decision in the case of Malik Naeema Abdul Aziz does not at all deal with the question of application of clause (ii) of subsection (3) of section 30 of the Act, and is confined to the consideration of the case of a tenant who has defaulted in the payment of rent in terms of clause (i) of that subsection.

11. The second case, namely, that of Muhammad Shafi v. Abdul Hayee again relates to clause (i) of subsection (3) of section 30 and was decided by the same learned Judge, namely, Sardar Muhammad Iqbal, J. who delivered the judg ment of the Court in the case of Malik' Abdul Aziz v. West Pakistan Publishing Company (Private) Ltd. The learned Judge observed that the Rent Controller could have jurisdiction only if it was proved that the transferee had given a notice and the tenant had failed to pay or tender the amount of rent within three months. This case also, is therefore, not an authority for the proposition that even in cases governed by clause (ii) of subsection (3) of section 30 a notice of demand is an essential prerequisite.,

12. As I read the provisions of subsection (3) of section 301 of the Act, it is clear that the Legislature has made a distinction between the case of a tenant who defaults in the payment of rent and that of a tenant who parts with the property or doe other acts mentioned in clause (ii) of this subsection. In the first case the service of a notice of demand is an essential prerequisite before holding that the tenant has defaulted in the payment of rent; whereas in the second case there is no such requirement, and the acts mentioned in the second clause are made penal if they are committed after the transfer. The distinction between the two types of cases is obviously based on a rational principle, namely, that after the statutory relationship of 'landlord and tenant has come into existence between the parties, it is only reasonable and proper that the transferee must indicate by a notice of demand the rate of rent which he want to charge, within, of course, the limits allowed by proviso to subsection (1) of section 30; but in the case of acts of subleting, etc. there can be no question of a notice of demand before the acts are committed. At the most there could perhaps be a notice of prohibition; which is not mentioned anywhere in the Act. The very existence of the relationship between the parties presumes that these acts will not be committed, unless permitted by the agreement of tenancy. As in the present case the tenancy is created by the Statute itself which does not give any permission for the commission of these acts, it is clear that the commission of these acts has been made penal if they are done after the transfer has taken place. On this view of the matter, I am in agreement with the two Courts below that, the question of subletting alleged against the present appellant can be inquired into by the Rent Controller even though there has been no prior notice of demand.

13. I cannot endorse the view of the learned Rent Controller that notice of transfer is invalid in this case, because of its omission to mention the rent payable by the tenant. The learned Rent Controller has failed to appreciate that section 30 contemplates two kinds of notices, namely, a notice of transfer and a notice of demand. The first notice is mentioned in proviso (b) of subsection (1) of section 30, whereas the second notice is mentioned in clause (i) of subsection (3) of the same section. Of course the two notices can be combined to the same document, but it does not mean that there is no distinction between the two. The service of a notice of transfer is intended only to notify to the person in possession of the property as to who is the new landlord, and it also fixes the date of commence ment of the period of statutory protection granted by the law to the person in possession.

14. For the foregoing reasons, I see no merit in the present appeal which is hereby dismissed in limine. A. H. Appeal dismissed.