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First Rent Appeal No.571 of 1986, decided on 4th August, 1987.

---Ss.15 & 21--Payment of rent--Adjustment of credit purchases- Payment by adjustment of credit purchases effected earlier than date of payment, held, was lawful and could be accounted for by Rent Controller--Such form of payment was not barred by provisions of Rent Ordinance.

1980 S C M R 506 and 1983 C L C 1378 ref.

---Ss.15 & 21--Payment of rent--Practice of landlord having accepted late payment in past, held, could not give rise to practice authorising tenant to make late payments.

--Ss.15 & 21--Default in payment of rent--Landlord getting purchases on credit from tenant's shop--Tenant seeking adjustment of credit purchases towards rent upto a certain period--Tenant also sent rent for rest of period by money order which was refused by landlord- Tenant, held, not in arrears of rent--Finding of default in payment of rent against tenant reversed in appeal.

---Ss.15 & 21--Personal requirement--Shop--Landlord doing business of construction but becoming a patient of hernia and unable to support himself and his family by doing said business--Landlord suffered loss in business and ran into debt with a Bank--Landlord having no business premises other than shop in dispute--Held, landlord could not be denied possession of shop in circumstances- Finding of Rent Controller in favour of landlord on ground of personal requirement maintained--Although it was very harsh upon tenant to vacate a business premises but it was also harsh upon landlord to be denied a business premises when he really needed same.

Abdul Wajid Wyne for Appellant.

Hassan Jaffar for Respondents.

Dates of hearing: 10th and 21st May, 1987.

This appeal is directed against the order of ejectment issued against the appellant by the IVth Senior Civil Judge/Rent Controller, Karachi East dated 26-7-1986 on-the grounds of failure to pay rent and personal need of the respondent. The dispute is in respect of shop situated at 4/140, Drigh Colony, Karachi. The respondent had filed application for ejectment on 31-5-1981 stating that there were two shops for which the rent was initially Rs.45/- per month and eventually it was raises to Rs.150/- per month in March, 1980 and that electricity was ton be charged at Rs.30/- per month but the same could not be supplied after 6-12-1980. It was also stated that the rent was being adjusted by purchases of groceries by the respondent from the shop of the appellant but after December, 1980 there was failure on the part of the 'appellant to settle and adjust the account. There was no definite assertion in the application as to from what date the rent has not been paid.

The respondent had also sought eviction on the ground of personal need as he could not do his business of contracting as he had incurred debts and he was also patient of hernia and, therefore, he wanted to do business in these two shops which had been joined into one shop by the appellant.

The appellant in his written statement did not deny that he was a tenant but stated that it was only one shop and the rental was Rs.200/- per month. It was further stated that since August, 1979 there was no electricity connection in the shop. It was further averred that the appellant was running grocery shop and the respondent had been purchasing groceries from him and the rent was adjusted in that account. It was asserted that the purchases of the respondent from the shop of appellant upto April, 1981 were in the sum of Rs.5,447/- and that after adjustment of rent upto April, 1981 a balance of Rs.2,247/- was outstanding from the respondent to the appellant and that such account had been maintained in his books and the respondent has signed the said accounts. It was asserted that respondent started demanding from the appellant more rent from April, 1981 and on refusal of appellant he was sought to be forcefully evicted but Mohallah people intervened. The appellant asserted that he had sent money order for one month on 7-6-1981 but it was refused and then again on 11-7-1981 two months' rent i.e. May and June, 1981 was sent but it was also refused and thereafter the rent was deposited in Misc. Rent Case No. 3231/1981. It was denied that the appellant had not paid rent since December, 1980. Ultimately the appellant also denied the need of the shop by the respondent and stated that the respondent did not require the shop and wanted to obtain 'pagri'.

Issues of rate of rent, commission of default in payment of rent and personal requirement were framed.

The respondent filed his own affidavit and he was cross- examined. He was supported by Hakim Anwar Baig and Zafar Ahmed who were cross-examined. The appellant filed his own affidavit and the affidavits of Tariq., Hussain, Muhammad Yousuf, Shoukat Hussain and Abdul Wahid who were cross-examined.

The Rent Controller came-to the conclusion that the rent was Rs.330/- per month and that it had not been paid after December, 1980 and that the practice of adjustment of rent by purchase of groceries was not in accordance with the law 'and therefore, the same was ignored and the appellant was found to be in default of rent from January, 1981 to April, 1981 as the rent of May, 1981 only was tendered on 7-6-81 and thereafter two months' rent was tendered on 11-6-81. He also found that the need of the respondent for doing his own business was fully established as he had incurred losses in contracting business and he could not do heavy job.

Mr. Abdul Wajid Wyne, counsel for the appellant had attacked the findings of the Rent Controller on all the counts. However, I find plenty of justification in respect of the finding that the rent was Rs.330/- upto December, 1980 because there is Exhibit No. A/43 which is prepared by the appellant himself and acknowledged by the respondent as well that the rent from May, 1980 till December, 1980 was Rs.330/- per month amounting to Rs.2,640/-. The same document also shows the groceries purchased for this period by the respondent from the appellant in the cum of Rs.3,047/- and the same is shown to be adjusted partially towards the rent of Rs.2,6401- The credit of Rs.407/72 was thus left outstanding in favour of the appellant which was reduced to Rs.367/72. In any case this amount of Rs.367/7,' was outstanding in favour of the appellant.

It is an admitted position that after December, 1980 electricity did not exist in the shop, therefore from January, 1981 the rent can be only Rs.300/- per month. As I have observed earlier, the appellant cannot got out of his admission made is Ex. A /43 that the rent was Rs.330/- per month i.e. Rs.300/- rent and Rs.30/- for electricity upto December, 1980. His contention therefore, that rent was Rs.200, per month was clearly wrong.

However, I do not understand as to why the Rent Controller had refused to take into consideration the various vouchers showing the purchases made by the respondent from the appellant in 1981. The Rent Controller 'was not justified to take the view that the rent could not .be adjusted by credit purchases. This was the practice between the parties and the respondent himself had stated in his application that the rent used to be adjusted out of the purchases. The parties choosing a particular form of payment, the same cannot be regarded as barred by the provision of Rent Restriction Act, if, the same does not involve any illegality and I do not find any illegality in the adjustment from the credit purchases made by the respondent from the appellant. The learned Rent Controller has relied upon 1980 S C M R 506 for ignoring the practice of settlement of rent from credit purchases. He has also referred to 1983 C L C 1378 (Karachi) But I do not find any justification for the reliance placed by the Rent Controller. What the supreme Court has really ruled is, that the rent should be paid by 15th of every month and that practice of the landlord having accepted the late payments in past could not give rise to a practice authorising the tenant to make the late payments. It was, therefore, a delayed payment which was objected to by the Supreme Court. The Supreme Court had, however, not ruled that if a payment is made in time by the tenant to the landlord in a manner which is otherwise legal, then the same should be ignored. Payment by adjustment of credit purchases which had been effected earlier C than the date of payment is certainly a lawful payment as it is not a payment beyond time and, therefore, it had to be accepted as good payment and should have been accounted for by the Rent Controller. Even according to the Rent Controller there was a sum of Rs.367/72 due from the respondent to the appellant on 1-1-1981, and, therefore at least the rent of January, 1981 had been paid for. Again there are a number of credit purchases made by the respondent from the appellant during the months of January, 1981 to April, 1981 which had to be adjusted towards rent and particularly in view of the fact that the rent application had clearly stated that the accounts had not been settled after December, 1980, therefore it was necessary for the Rent Controller to have taken those credit purchases into account. The appellant had clearly stated that the respondent owned a sum of Rs.5,447/- in respect of these purchases and the same had not been denied by the respondent. The statement filed by the respondent showed that in January, 1981 there was a purchase of Rs.377/- and February, 1981 there was a purchase of Rs.416/- and in March, 1981 there was a purchase of Rs.447/- and in April, 1981 there was a purchase of Rs.314/88. This being the position, I am clearly of the view that the same should have been adjusted towards rent and. therefore, there was no default in the payment of rent upto at leas April, 1981 and since rent of May, 1981 had been sent by money order and refused by the respondent, therefore the appellant was not in arrears of rent at all on 31-5-1981 when the ejectment application was filed. I have, therefore, no hesitation in coming to the conclusion that there was no default committed by the appellant. Therefore, the finding of default in payment of rent is reversed.

I must make it clear that the finding that the rent was Rs.300/ per month from January, 1981 onwards is clearly correct and acknowledged by the appellant himself and, therefore, the said finding is maintained in respect of Issue No. 1.

Counsel for the appellant has, however, not been able to satisfy me as to how the ejectment granted on personal requirement basis is wrong. The respondent was doing business of contracting but he has become a patient of hernia and, therefore, he cannot support himself and his family by doing the said business. In any case he has suffered loss in the said business and had to pay to the bank a sum of Rs.16,000/- for the amount of Rs.12,000/- which he had taken. The respondent had to support a family of five persons and since he has no other business premises, therefore he cannot be denied to have the possession of the shop which is in possession of the appellant. The contention of the appellant that the respondent has an income of Rs.700/- per month from the tenants is hardly of any consequence in view of the fact that Rs.700/- per month is not enough, even a subsisting wage for the lowest paid employees of any department and, therefore, Rs.700/- per month cannot be regarded as sufficient to meet the expenses of a family of five members. The respondent has no other business premises in his possession and, therefore, it is only fair that the appellant should be directed to vacate the shop. I know that it is very harsh upon the tenant to vacate a business premises but it is also harsh upon the landlord toe be denied a business premises when he really needs the same.

The Rent Controller had made an inspection of the premises in question as the contention of the appellant was that the respondent was in possession of two shops but he did not find any shop in possession of the respondent. He found that the disputed premises had marks of partition wall in the middle and there were galleries on the western and eastern sides of the disputed shop was found. The said gallery was about 3 feet wide and the finding of the Rent Controller was that it cannot be treated as shops. The respondent has two stores which he had made out of these galleries one of which is 3' x 7' and the other is 3' x 4 ". It is correct that these stores can hardly be regarded as shops but since the appellant's counsel was insisting that these can be used by the respondent as shops, therefore Mr. Hassan Jaffar, counsel for the respondent had offered on behalf of the respondent that the respondent will be prepared to give these two stores to the appellants if he surrenders the disputed shop. Mr. Wyne, counsel for the appellant had taken time to consult his client but eventually on 21-5-1987 his client declined to accept the offer. This abundantly shows that the two stores which were alleged by the appellant to be shops in possession of the respondent are really not the shops and, therefore, the appellant is not willing to accept them. This leaves me with no choice but to agree with the finding of the Rent Controller that the respondent is not in possession of any shop, therefore need for the disputed shop is clearly established in favour of the respondent and, therefore, the said finding is maintained and ejectment on the ground is justified.

Still in order to allow some relief to the appellant. I would direct that the appellant should vacate the shop in question and hand over its possession to the respondent within a space of nine months from today, otherwise direct writ of possession without notice to the appellant will be issued by the Rent Controller. The concession of nine months would be forfeited by the appellant if he does not continue to deposit the Rent of Rs.300/- p. m. in Court in time. Although the appellant has declined to accept the offer of Mr. Hassan Jaffar in respect of two stores mentioned above which are on the eastern and western sides of the disputed shop. I would still make it open to the appellant to avail of that offer and seek the said two stores as an alternate accommodation for him but he shall have to settle rent for the same with respondent.

With the above modification in the finding of the Rent Controller, the ejectment order is maintained and the appeal is dismissed.

M.Y.H/M-243/K Appeal dismissed.

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