2015 PLP 674 (MLD)

FAISAL ARAB, J.

The petitioner is tenant of respondent No.1 since 1970. He was inducted as tenant at the rate of Rs.600 per month. Same rate of rent continued till 2005 when after 35 years of creation of tenancy, respondent No.1 filed application under Section 8 of the Sindh Rented Premises Ordinance, 1979, seeking enhancement of rent. The Rent Controller in his decision dated 13-11-2010 enhanced the rent from Rs.600 per month to Rs.18,000 per month but made, it effective from the date of the order i.e. 13-11-2010. Aggrieved by the decision of the Rent Controller, respondent No.1 filed appeal. The appellate Court vide its decision dated 27-4-2011 maintained the enhanced rate of rent but made the enhancement applicable from the date of filing the Fair Rent Application.

2. The basis for fixing the date of the enhanced rent by the appellate Court from the date of institution of Fair Rent Case was the judgment of the Hon'ble Supreme Court reported as (Messrs Victor Restaurant v. State Life Insurance Corporation of Pakistan and others) (2010 SCMR 745), wherein it was held that if the date is fixed for payment of the enhanced rent other than the date of institution of the fair rent case then reasons must be assigned for the same. In the present case, the counsel for the petitioner contends that the petitioner has not questioned the reasoning with regard to the quantum of fair rent but the petitioner is only aggrieved by the decision of the appellate Court whereby the effective date of payment from the date of order of the Rent Controller was changed to the date of institution of the application. He contended that the Rent Controller after considering all factors exercised his discretion by fixing the rent from the date of the order but the Appellate Court applied the rule of thumb and fixed the rent from the date of institution of the Rent Case without assigning any plausible reason for overturning the discretion exercised by the Rent Controller. In his contentions, he relied upon the judgments reported in PLD 1994 SC 725, PLD 2007 Karachi 485 and 2010 CLC 1064. It was also contended that the Rent Controller has all the powers to fix the effective date of payment of enhanced rent i.e. from the date of the application to the date of the final order or any other date in between, these two events, therefore, no legal error was committed by the Rent Controller in fixing the date from the final order and the Appellate Court without finding any defect in the exercise of such discretion modified the date from which the enhanced rent was to be paid.

3. In rebuttal, the counsel for the respondent No.1 contended that the reasons for changing the effective date for payment of enhanced rent have been disclosed by the Appellate Court which are two fold; firstly the Appellate Court relied upon the judgment of the Hon'ble Supreme Court in the case of Messrs Victor(supra) and; secondly it took into consideration the fact that the tenant was paying rent of Rs.600 per month for about 35 years, therefore, the Rent Controller committed error in fixing the date of enhanced rate of rent from the date of the order instead of fixing it from the date of the institution of the Fair Rent Application.

4. The case law that has developed so far gives discretion to the Rent Controller to fix the fair rent from the date of the institution of the rent application or from the date of the order or any point of time in between these two events keeping in view the facts and circumstances of each case. Where discretion is to be exercised by a Court, the same should not be arbitrary but based on sound reasons. It is established law that rights of the parties are to be determined on the facts and circumstances obtaining on the date of the institution of the legal proceedings. No doubt, court can also take into consideration subsequent events which transpire during the pendency of the case. In the present case, it has not been pointed out to this Court that any factor which warrant enhancement of rent had occurred during the pendency of the rent proceedings so as to make the effective date of enhancement of rent other than the date of institution of the Fair Rent Application. None of the facts and circumstances suggests that the Rent Controller ought to have fixed the date other than the date of the institution of rent proceedings. The case of Victor (supra) is quite clear. It says that the Rent Controller is to fix the rent from the date of the filing of application and if it fixes any other date then reasons are to be given. No circumstance has been pointed out to establish that the Rent Controller rightly exercised his discretion in fixing the date of enhanced rent from the date of the final order. His decision was rightly modified by the Appellate Court. Hence this petition is dismissed in limine.

5. At this stage, the counsel for the petitioner states that the differential amount comes to approximately Rs.1.5 million, therefore, some time may be granted for making payment. Let the differential amount after calculation be paid by the petitioner to respondent No.1 in four equal installments commencing from 1-11-2014. KMZ/L-5/Sindh Petition dismissed.