Asia & Australia

December 08, 2017

NDMC Act cannot override Delhi Rent Act: SC

Supreme Court Of India

Hearing a petition, the Supreme Court of India ruled that the NDMC (New Delhi Municipal Corporation) Act was not a special enactment and could not override provisions of the Delhi Rent Act.

The petitioner Atma Ram, who owns a property at Connaught Place, said that he was paying more tax then the rent amount and the amount of property tax levied by NDMC became recoverable as arrears of rent.

Arguing further, he said that the suit property having fetched rent above Rs 3500 per month has ceased the protection of the Delhi Rent Act.

“After the recent amendment in the NDMC byelaws, the house tax on the property was calculated on the basis of Unit Area System and according to which the total house tax payable was in excess of Rs. 9 lakh. Therefore, the tenant should pay the amount,” the petition said.

After the tenant refused to pay the amount, Atma Ram terminated his contract and filed a case against him.

The trial court in 2013, ruled in favor of the owner, which was overturned by the Delhi High Court. The owner then filed an appeal in the Supreme Court against the High Court order.

After hearing the arguments, the court said, “The object of the Rent Act is to provide protection to tenants who under common law, including Transfer of Property Act could be evicted from the premises let out to them at any time by the landlord on the termination of their tenancy. It restricts the right of the landlord to evict the tenant at their will. It is a special law in relation to landlord and tenant issue. Therefore, the Rent Act has to prevail insofar as landlord and tenant issue is concerned.”

Adding further, the court said, “Section 67(3) of the NDMC Act merely gives a right to recover the 21 tax in respect of the premises as rent. It does not override the Rent Act insofar as obviating the effect of Section 7(2) of the Rent Act. In our opinion, the tax recoverable from the tenant under Section 67(3) of the NDMC Act as arrears of rent by the appellant cannot be considered to be forming part of the rent for the purpose of seeking eviction/ejectment of the respondent who defaults in payment of such recoverable tax as rent.”

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