1988 PLP 272 (CLC)

This is an appeal under section 21 of the Sind Rented Premises Ordinance, 1979 hereinafter referred to as the Ordinance, against the order dated 7‑3‑1984 passed by the learned VIth Senior Civil Judge and Rent Controller, Karachi in Rent Case No. 3240 of 1981.

2. The brief facts leading to the filing of the above appeal are that the appellants were inducted into the premises as tenant under agreement dated 28‑11‑1970 at the rate of Rs.650. After few years, the appellants, as alleged by them, were permitted to carry out certain additions and alterations in the premises at their own costs and the rent was increased to Rs.1,000 per month with effect from 1‑12‑1979. On 25‑7‑1981, however, an application was filed by the respondent against the appellants on the ground of default, unauthorised additions and alterations, damage to the premises and conversion of its use from residential to commercial. On the pleadings of the parties, the learned Rent Controller framed the following issues: ‑‑ (1) Whether the opponent is defaulter in payment of rent? (2) Whether the opponent has caused damage to the premises? (3) Whether the opponent have converted residential premises into commercial premises? (4) What should the order be? The learned Rent Controller after recording evidence led by the parties gave his findings on all issues in favour of the respondent and allowed the ejectment application by his order dated 7‑3‑1984, directing the appellants to vacate and hand over the possession of the premises to the respondent within two months.

3. As regards the first issue, the alleged default pertained to the months of May, June and July, 1981. Mr. A. Aziz, learned counsel for the appellant submitted that the respondent had not paid the property tax for the years 1978‑79, 1979‑80 and 1980‑

81. A demand for Rs.4,374 was thus received by the appellants from the Excise and Taxation Department threatening to take penal action, against the appellants. These notices were received by the appellants on 14‑4‑1981 and 20‑4‑1981. Thus, a letter was sent by the appellants to the respondent landlord, wherein it was stated that if the taxes were not paid by the respondent, the appellant shall be constrained to pay them and adjust the amount in the rent. It appears that the respondent failed and neglected to pay the said taxes, with the result that the sum of Rs.4,000 in four instalments of Rs.1,000 each was paid by the appellants to the Excise and Taxation Department on 9‑5‑1981, 20th June, 1981, 11th July, 1981 and 12th August, 1981 for the months of May, June, July and August, 1981 retrospectively.

4. Learned counsel for the appellants referred to section 4(a) of the West Pakistan Urban Immovable Property Tax Act (Sind Amendment Ordinance I V of 1971), whereby amending section 2 of the West Pakistan Act V of 1958, the word "Sind" for "West Pakistan" was substituted. Section 14 of the said Act, provides that where the tax due from any person on account of any building or land is in arrears. It shall be lawful for the prescribed authority to serve upon any person paying rent in respect of that building or land, or any part thereof, the person from whom the arrears are due, a notice stating the amount of such arrears of tax and requiring all future payments of rent (whether the same have already acrued due or not) by the person paying the rent to be made direct to the prescribed authority until such arrears shall have been duly paid, and such notice shall operate to transfer to the prescribed authority the right to recover, receive and give a discharge for such rent. If the person paying rent wilfully fails or neglects to comply with the notice aforementioned, the prescribed authority may, after giving him an opportunity of being heard, proceed against him as it would have proceeded under the provisions of this Act against the owner of the building or land in respect of which the tax is in arrears. The section further provides that if any person on being served with such notice as may be prescribed fails to pay within the period specified in the notice any amount due from him on account of the tax, the prescribed authority may recover from him as penalty a sum not exceeding the amount of the tax so unpaid,, in addition to the amount of the tax payable by him. Learned counsel further placed his reliance on the cases of Haji Khuda Bux v. Muhammad Anwar 1982 C L C 1006, Commerce Bank Ltd. v. Mst. Sughran Bai and 3 others P L D 1987 Kar. 136 and Raja Muhammad Shaft v . Abdul Ghafoor P L D 1977 Lah. 1072. In reply, learned counsel for the respondent submitted that the amount of taxes was enhanced from Rs.270 to Rs.1,000 due to commercial use of the property by the appellants and thus he was not liable to pay at the said rate. By my order dated 5‑10‑1987, I directed him to produce property tax receipts prior to August, 1981. In pursuance of the said order, learned counsel produced two receipts for the years 1972‑73 and 1973‑74, showing the amount of tax as Rs.270 and submitted that he had no receipt in his possession for the period 1974‑75 and onwards.

5. On the other hand, learned counsel for the appellants produced receipts for the years 1974‑75 and 1977‑78, showing the amount of tax as Rs.992.44 and submitted that he is in possession of all the receipts of tax upto date and was ready to produce, if the same are required. However, on my further enquiry it was submitted by Mr. Zafar that the respondent did not file any appeal against the said increase in taxes. I am, therefore, of the view that the respondent was made liable to pay the said taxes in accordance with law. Having placed reliance on Lahore case P L D 1977 Lah. 1072 which is a direct authority on the point, I am clear in my mind that the liability of the appellant for payment of rent, for the period alleged, stood discharged by paying the said property tax in response to two notices issued to the appellants. The appellants cannot, therefore, be said to be defaulter when the application for ejectment was filed. The finding of the learned Controller, is, therefore, reversed. (This is, however, without prejudice to respondents' right to claim from the appellants, by a separate suit, the amount of difference in taxes, paid on account of the respondents, if the conversion to commercial use is held as not unauthorised by the respondent).

6. As regards issue No. 2, regarding damage to the premises, learned counsel for the appellant invited my attention to the order dated 16‑3‑1987 passed by my learned brother Saleem Akhtar, J. while disposing of a Misc. application that there seems to be no serious damage caused to the premises by the appellants. Learned counsel submitted that there is no evidence as to the damage allegedly caused by the appellants to the premises in question. Reliance was placed by him on the cases of Iqbal Ahmad v. Mehrban Ali P L D 1979 Lah. 127 and Iqbal Ahmad v. Mehrban Ali P L D 1978 Lah. 1070, wherein the plea of causing damage to the premises was repelled for no evidence. Learned counsel for the respondent has referred to the Commissioner's report in support of the allegation of damage. Counsel for the appellant, has, in reply, invited my attention to his objections to the said report. It appears that the said objections have not been considered and disposed of by the learned Rent Controller as there is no order to that effect. However, the report of the Commissioner speaks of much about the addition and alteration in the premises. There is very little evidence as to the damage. No architect has been produced by the respondent. The additions and alterations carried out by the appellants, are alleged to have been made by consent of the respondents in consideration of the increase in rent from Rs.650 to Rs.1,000 per month. Learned counsel for the respondent did not say a word about it. In any case, the addition alteration cannot be itself be said to be causing damage unless they are proved as such. I am, therefore, of the view that the damage, if any, caused to the premises comes within the ordinary wear and tear. After all, the premises is old for over a decade and has been in constant use and occupation of the tenant /appellants. There is no convincing evidence on damage. The issue has not been proved by the respondent and as such the finding of the learned Rent Controller is reversed on issue No. 2 as well.

7. As regards the third issue relating to conversion of use from residential to commercial, the learned counsel for the appellants has submitted that the appellants were carrying on their business at Burns Road and then they shifted their business to the premises in question. It was further submitted by him that it was agreed in the tenancy agreement that a 20 H.P. electric power would be obtained at the premises, which cannot be said to be for residential purpose. Besides, appellants' neon sign was also to be installed at the premises. All these things, according to him, go to prove that there was an implied agreement between the parties that the premises was to be used for commercial purpose.

8. Almost the same argument. seems to have been made before the learned trial Court, who appears to have dealt with it quite elaborately in his judgment impugned before me.

9. Mr. Zafar Hadi Shah, learned counsel for the respondents, submitted that the conversion of use of the bungalow in question from residential to commercial took place in the year 1975. The respondent, thereupon, served a legal notice dated 13‑4‑1975 on the appellants objecting to the said conversion of use, which was replied by the appellants' counsel alleging that the premises was for commercial and not for residential purposes. The submission of the learned counsel for the respondent that the rate of property tax was raised from Rs.270 to Rs.992 for change of its use since 1974‑75 lends support to the submission that the change of use from residential to commercial appears to have taken place in or about 1975. The water charges bill for 1978 at commercial rate, produced by the appellants in evidence before the Controller, is also a pointer to the fact of conversion in or about 1975. Reliance was placed by Mr. Zafar on the case of Raja Qurban Khan v. Begum M.M. Sharif and another 1980 S C M R 596, wherein it was held that despite the permission or acquiscence of the landlord the tenant could not put the premises to commercial use without getting the sanction of the Rent Controller under section 11 of the Urban Rent Restriction Ordinance, 1959. Reliance was also placed on the case of Muhammad Saleem and others v . Begum Musarrat Bashirul Hassan and another P L D 1981 S C

578. In that case the lease deed was silent on the question as to the use to which the bungalow was to be put, but it was admitted that shortly after it was given on rent, the petitioner installed a Printing Press in it. The fact that it is a residential bungalow is evident from the fact that it is situated in a purely residential area. The Honourable Supreme Court referring to its earlier judgment in 1980 S C M R 590, appears to have held that the conversion was not permissible under the law.

10. Learned counsel for appellants laid much stress on obtaining electric power of 20 H.P., but it was for air‑conditioning plant, as stated in the agreement itself. Had it been for running a printing press, there was no impediment for the parties to state so in the agreement. The learned counsel, has, therefore, failed to persuade me, to up‑set the finding of the learned Rent Controller on this issue that "the premises were let for residential purposes and not for commercial purpose." The finding of the learned Rent Controller on issue No. 3 is, therefore, maintained.

12. Learned counsel for the appellants, lastly, took a plea of estoppel and submitted that the premises was being used for commercial purpose since inception of the tenancy, but the respondent, in spite of his knowledge, did not take any action against the appellants. The respondents, therefore, according to him, waived his right to seek ejectment on the ground of conversion of use.

13. On the other hand, Mr. Zafar Hadi Shah, learned counsel for the respondent, as a preliminary objection, submitted that the plea of estoppel was not taken by the appellants in the written statement. The appellants, therefore, debarred from raising this plea in appeal, as it is a mixed question of fact and law. For this submission, reliance was placed by him on the case of Deutsche Damp schiffaharts Geseluschaft and another v. Central Insurance Co. Ltd., Karachi PLD 1975 Kar. 819, wherein the plea of estoppel was for first time appears to have been taken in the High Court. It was thus observed by a Division Bench of this Court that "the plea of estoppel cannot be considered, because it has not been pleaded". Reliance was also placed by the counsel on the case of Pappammal v. Alamelu Ammal and another A I R 1929 Mad.

467. In the Letters Patent Appeal against a decree passed by the learned Chief Justice of that Court in a suit, it was observed by a Division Bench that where plea of estoppel was never set up in the pleadings or in the issues it cannot be availed of later, because it is eminently a matter of pleadings.

12. Admittedly, the plea of estoppel was not taken either in the written statement or in the issue or in the arguments before the learned Rent Controller. A plea of estoppel should not be allowed to~ be raised ordinarily at the appellate stage, as it is a fixed question of fact and law. Learned counsel for the appellants has failed produce any decision in support of his submission that the plea is entertainable at this stage. Furthermore, the plea of estoppel is~ inconsistent with the plea taken by the appellant that the premises was let out for commercial purposes.

13. I, therefore, do not consider it proper to allow the appellant to raise the plea of estoppel at this stage. In this view of the', matter, I do not consider it necessary to discuss the several decisions cited at the bar on the question of estoppel.

14. In the result, the appeal is dismissed. Two months' time is, however, allowed to the appellants to vacate the premises and hand over its possession to the respondent, failing which the appellants will be liable to be evicted without notice. A.A. /L‑9/ K Appeal dismissed.