' SADIQ HUSSAIN BHATTI, J.---The petitioner is aggrieved by the judgment dated 15-4-2011 passed by the learned III Additional District Judge, Karachi West in First Rent Appeal No, 57 of 2009 whereby the appeal was dismissed and the impugned order dated 30-9-2009 passed by III Rent Controller, Karachi West in Rent Case No,18 of 2008, allowing the same, was maintained.
2. Brief facts of the case are that respondent is the owner/landlord of ground floor premises situated in the building known as "Muhammad Bakhsh and Sons Building, 23-West Wharf Road, Karachi and the petitioner is tenant in respect of a portion thereof at a monthly rent of Rs,2,920. The respondent No,1 filed an application under section 8 of the Sindh Rented Premises Ordinance, 1979 for fixation of fair rent at the rate of Rs,50 per square foot per month. The petitioner filed written statement and denied the averments made in the rent case. On the basis of the pleadings of the parties, the learned Rent Controller framed the following issues:-
(1) Whether the applicant is entitled for fixation fair rent of the demised premises?
(2) What should the order be?
3. After recording evidence of the parties and after hearing the learned counsel for the parties, the learned Rent Controller, vide order dated 30-9-2009, allowed the application under section 8 of the Ordinance and fixed the fair rent of the demised premises at the rate of Rs,45 per square foot per month from the date of filing of the rent case with an increase of 20% per annum in the said rate.
4. Being aggrieved by the order of the learned Rent Controller dated 30-9-2009, the petitioner filed F.R.A. No,57 of 2009, which was firstly allowed by III Additional District, Karachi West vide judgment dated 18-2-2010; the impugned order was set aside and the case was remanded back to the Rent Controller to decide the same afresh. However, when the respondent assailed the same before this Court in Constitutional Petition No, S-379 of 2010 which was allowed by a learned Single Judge of this Court vide order dated 11-10-2010; the impugned judgment was set aside and the case was remanded back to the appellate Court to decide it afresh. Consequently, the III Additional District Judge, Karachi West heard the arguments of the parties afresh and dismissed the appeal vide the impugned judgment. Hence this petition.
5. Mr. Kadir Bakhsh Bhutto, learned counsel for the petitioner contended that the learned Rent Controller was not justified in fixing the fair rent of the demised premises at such an exorbitant rate.
He stated that previously the rate of rent was Rs,1.06 per sq. Ft but it was raised to Rs,45 per sq. Ft and thus increased the rent from Rs,2928 per month to Rs,123,885 per month, thus, the rent was increased by 4300%. He further stated that not a single penny was spent by the landlord on the maintenance/repairs of the demised premises. He also stated that the Rent Controller also ordered increase of rent by 10% from the year 1991 i,e, prior to the filing of the rent case in January, 2008 which is against the law. He also contended that the respondent No,1 has failed to prove any of the ingredients of section 8 of the Ordinance. He also submitted that the learned two Courts below have not read the material evidence on record. The learned counsel also contended that though tax receipts were produced but property number was not mentioned therein. That the documents produced by the respondent No,1 were collusive and were pertaining to different property.
6. On the other hand, the learned counsel for the respondent No,1, Mr. Amir Saleem, fully supported the impugned judgments and stated that the learned Appellate court has taken into consideration the factors mentioned in section 8 of the Ordinance before fixing fair rent: He stated that there was in increase in the rent since 1991 and the petitioner was depositing rent in MRC without increasing the same as per law.
7. The first objection of Mr. K.B. Bhutto, learned counsel for the petitioner is with regard to the area of the demised premises. The respondent No,1 alleged in the application under section 8 of the Ordinance that the area under occupation of the tenant/opponent/ petitioner is 2753 sq. Ft. And also gave a complete break (sic) of the same i,e, 1953 sq. Ft on the ground floor and 800 sq. Ft. On the mezzanine floor. This averment has not been denied by the petitioner in its written statement. It is only stated that area of the said tenement is subject to actual measurement. If at all there was a dispute regarding area of the tenement then the same was in possession of the petitioner and it should have been measured and specifically stated that the area of the tenement is such. This halfhearted denial is nothing but an effort on the part of the petitioner to create issues where none exists. Even otherwise, factual A controversies cannot be resolved in a constitutional petition.
8. The next contention of learned counsel for the petitioner is with regard to the increase in rent.
According to Mr. Bhutto, the increase in rent is exorbitant and unreasonable. He stated that the petitioner was paying rent at the rate of Rs,1.06 per sq. Ft. But it was increased to Rs,45 per sq.. Ft. Per month.
9. The mechanism and procedure for fixation of fair rent is provided in section 8 of the Ordinance, which reads as under:-- "8. Fair rent.---(1) The Controller shall, on application by the tenant or landlord determine fair rent of the premises after taking into consideration the following factors:--
(a) the rent of similar premises situated in the similar circumstances, in the same or adjoining locality;
(b) the rise in cost of construction and repair charges;
(c) the imposition of new taxes, if any, after commencement of the tenancy; and
(d) the annual value of the premises, if any, on which property tax is levied.
(2) Where any addition to or, improvement in, any premises has been made or any tax, or other public charge has been levied, enhanced, reduced or withdraw in respect thereof, or any fixtures such as lifts or electric or other fittings have been provided thereon subsequent to the determination of the fair rent of such premises, the fair rent shall, notwithstanding the provisions of section 9 be determined or, as the case .May be, revised after taking such changes into consideration."
10. Thus it would be seen that section 8 of the Ordinance provides four factors for determination of fair rent of a premises. ' The first is the rent of similar premises situated in the similar circumstances in the same or adjoining locality, the second factor is regarding rise in the cost of construction and repair charges, the third is imposition of new taxes, and the fourth is annual value of the premises on which property tax is levied. It is not necessary that all the four conditions must be satisfied or fulfilled by the landlord while praying for fixation of fair rent of the demised premises and anyone condition specified in section 8, ibid, is sufficient to fix the fair rent of the demised premises. I am fortified in my view by the judgment in the case of Muhammad Afaq v. State Life Insurance Corporation of Pakistan and 2. Others (PLD 2008 Karachi 100), wherein it was held as under: "Section 8 of the Ordinance, 1979 provides four conditions and it is not necessary that all the four conditions must be satisfied or fulfilled by the landlord while praying for fixation of rent of the demised premises and anyone condition specified in section 8, ibid, is sufficient to fix the fair rent of the demised premises. In the present case the learned appellate Court has taken into consideration the evidence that the property similar to the property in dispute could fetch Rs,40 per square foot, as such the learned appellate authority has considered all the relevant aspects of the case before fixation of the fair rent and no illegality or misreading of evidence has been pointed out by the learned counsel for the petitioner in the order passed by the learned appellate Court."
10. In the present case the Courts below have taken into consideration the evidence that a portion measuring 2357 sq. Ft. Of the building in which the demised premises itself is situated, is fetching rent at the rate of Rs,69,000 although the same is being used as a 'godown and is not situated on the main road while the demised premises is situated on the main road. Similarly, another portion of 1104 sq. Ft. On the first floor of the same building was let out to one Mr. Daud Badaruddin at the rate of Rs,45 per sq. Ft. Per month. Such agreements with tenants were produced in Court and Mr. Daud Badaruddin also appeared as a witness and was cross examined at length. Thus, the Rent Controller was justified in fixing fair rent of the demises property keeping in view the "rent of similar premises situated in the similar circumstances, in the same or adjoining locality." The learned appellate authority has also considered all the relevant aspects of the case before fixation of the fair rent and no illegality or misreading of evidence has been pointed out by the learned counsel for the petitioner in the Order/Judgment passed by the two Courts below. The provisions of section 8, unlike provisions of section 9' of the Ordinance which provides for maximum 10% increase per annum increase in the fair rent, do not lay down a minimum or maximum limit above or below which no increase can be allowed by the Rent Controller. Thus, if rent of a property was abysmally low and was brought at par with other rented premises in the area by increasing the same manifold would not render the same illegal or without jurisdiction. The respondent No,1 brought on record evidence to prove that the tenements in the same area, rather same building, were fetching rents at the above rates but the petitioner was unable to rebut the same through cogent evidence.
Mere allegations against the witnesses or the douches produced by them would not serve the purpose of the petitioner. Once the respondent No,1 was able to show that the rate of rent in the similar/adjoining areas was Rs,45 per sq. Ft. Or higher, the onus shifted to the petitioner to bring evidence to negate the assertion of the respondent No,
1. But there is nothing in rebuttal except allegations that the witness is a set up witness. Even the written statement filed by the petitioner was discarded for cogent reasons. Therefore, in fact, there was no evidence in rebuttal against the evidence brought on record by the respondent No, 1 .
12. It is an admitted fact that petitioner is occupying the demises premises since long and has been depositing rent in MRC since 1991 at the rate of Rs,2,928 per month. This shows the callous attitude of the tenant/petitioner towards its landlord/respondent No,1 that it did not increase the rent from 1991 till the filing of the case for fixation of fair rent in the year 2008.
13. In view of the above discussion, the contention of Mr. Bhutto that respondent' No,1 failed to prove any factor in terms of section 8 of the Ordinance, is also not tenable and is hereby rejected.
14. So far as objection regarding the tax receipts is concerned, if this piece of evidence is discarded, even then there is the evidence with regard to factor No 1 regarding rent of similar premises in the same or adjoining locality. Even otherwise the tax receipts clearly show that the same are in the name of Muhammad, Bakhsh and Sons i,e, respondent No,l.
15. Mr. K.B. Bhutto, learned counsel for the petitioner, also objected to the grant of arrears of rent by the Rent Controller from the year 1991 till filing of the rent case in the year 2008 at the rate of 10% increase in the rent. The respondent No,1 filed the rent case under section 8 of the Ordinance in the year 2008 with the following prayer: 16.
(a) To determine fair rent of the Tenement measuring 2753 square feet (1953 sq. Ft on the Ground Floor plus 800 sq. Ft. On the Mezzanine Floor), on the Ground Floor at main road side of the Building namely Muhammad Bakhsh and Sons Building, 23, West Wharf Road, Karachi, and fix the same at the rate of Rs,50 per sq. Ft. Per month from the filing of the above Rent Case; E
(b) To direct the Opponent to pay the so determined fair rent of the said Tenement to the applicant; (c). Grant costs of the proceedings; and
(d) Any other relief or reliefs which this Hon'ble Court may deem fit and proper under the- circumstances of the case.
' On the basis of the pleadings of the parties, the following issues were framed by the Rent Controller for determination:--
(1) Whether the applicant is entitled for fixation of fair rent of the demised premises?
(2) What should the order be?
17. Thus, neither there was any prayer for fixation of rent from 1991 (nor such prayer can be made in an application filed in the year 2008) nor there was any issue whether the applicant was entitled to fixation of fair rent or payment of arrears of rent from the year 1991. In this regard reference may be made to the case of STATE LIFE INSURANCE CORPORATION OF PAKISTAN, KARACHI V. Messrs VICTOR RESTAURANT through Partners and others (2009 YLR 1124) wherein the following observation was made:- "14. From the perusal of orders of the two Rent Controllers and the order of one appellate Court one thing is clear that both the Courts are consistent about the rate of rent i,e, Rs,6.50 per sq. Ft. The difference between the two orders is about the date of effectiveness of the fresh rate of rent and the area of the premises. First of all from the perusal of prayer of the landlord in Constitutional Petition No,S-414 of 2007, it appears that in either case he is not dissatisfied with the rate of rent but his concern is about the date of effectiveness of the fresh rate of rent and the measurement of the tenement. Regarding the question that when the enhanced rent should be made applicable, the learned Judge of the appellate Court has not given any cogent reasons that as to why it should not be commenced from the date of institution of the application under section 8 of the Sindh Rented Premises Ordinance, 1979 before the Rent Controller and why it should commence from the date of the order passed by the appellate Court. The provisions of section 8 of Sindh Rented Premises Ordinance do not impose restriction on Rent Controller about the date of effectiveness of the enhanced rent. The fixation of date of enhancement of rent is discretionary with the Rent Controller.
There should have been convincing and plausible reasoning for deciding upon the discretion exercised by the Rent Controller. It would, be just and fair to decide the matter in view of the circumstances prevailing at the time of filing of the application because the facts mentioned in the application are based upon the conditions prevalent on the date. The rent application is based on facts and circumstances collected upto that date. The evidence, as to the rate of rent, is also brought on record, keeping in'view the rates, rents, taxes, market values prevalent on the date or prior to it. I am fortified by the dictum 'aid down in the case reported in PLD 1996 Karachi 494 (Shahid Ahmed alias Shahid Mukhtar and 9 others v. Mst. Rasheeda Khatoon and 12 others) wherein it was held as follows:-- "In the instant case application for enhancement of the rent was filed on 22-12-1992 but the learned Rent Controller had fixed the fair rent from 1-1-1990. It is well-established principle that where the statute does not provide the date, the same can be fixed either from the date of filing of application or from the date of the order or even from the date in between the two dates looking to the peculiar circumstances of the case. In my view the date fixed by the Rent Controller for payment of fair rent is not proper and the proper date would be the date on which the landlord agitates his right of payment of fair rent, i,e, 22-2-1992."
18. In view of the law laid down by the above cited judgments, there was no justification in fixing fair rent from a date before the filing of the rent case.
19. In my view, there is no misreading or non-reading of the evidence in fixation of the fair rent.
20. Accordingly, this petition is partly allowed to the extent that the impugned order of the Rent Controller directing the tenant/petitioner to pay arrears of rent from the year 1991 till the filing of the rent case is set aside. However, the order of the Rent Controller with regard to fixation of fair rent is maintained with effect from the date of filing of the rent case .