Holding

A deposit of rent made under Section 30(2) is deemed payment to the landlord and is eligible for adjustment under Section 20(4), so the tenant is not in default of rent.

Summary

The Municipal Board leased premises to the respondents, who sublet them to the appellants. After the lease expired, the Board demanded rent, and the appellants deposited the rent in court under Section 30(2) of the U.P. Urban Building (Regulation of Letting, Rent and Eviction) Act, 1972, citing doubt as to the rightful recipient. The respondents sued for eviction on grounds of sub‑letting and alleged arrears of rent; the appellants also deposited alleged arrears under Section 20(4) before the hearing. The trial court dismissed the suit, but the revisional and High Courts held the tenant was in default, reasoning that a deposit under Section 30(2) could not be adjusted under Section 20(4). The Supreme Court held that a deposit under Section 30(2) is deemed payment to the landlord and must be taken into account for adjustment under Section 20(4), rejecting the High Court’s narrow reading. Consequently, the tenant was not in default and the appeal was allowed, restoring the trial court’s order.

Issues considered

Whether rent deposited under Section 30(2) of the U.P. Urban Building Act can be adjusted against arrears under Section 20(4) in an eviction suit.
Whether the omission of reference to Section 30(2) in Section 20(4) precludes such adjustment.
Whether the tenant remains liable for eviction on the ground of default in rent after making the deposits.

Subjects

rent controlevictiondeposit of rentstatutory interpretationharmonious constructionU.P. Urban Building Actdefault in rentsub‑lettingadjustment of rent

Judgment

KAILASl;I CHANORA AND ANR A
v.
MUKUNDI LAL AND ORS.

JANUARY 25, 2002

[R.C. LAHOTI AND BRIJESH KUMAR, JJ.) B

Rent Control and Eviction:

U.P. Urban Building (Regulation of Letting, Rent and Eviction) Act
1972-Section 20(4), 30-Default in payment of rent-Lease of premises to C
landlord by Municipal Board-Premises let out to tenants during lease period-
Municipal Board claiming rent from tenants after expiry of lease-Deposit of
rent in Court under Section 30(2) on ground of doubt about the recipient of
rent-Suit by landlord for eviction for default in payment of rent-Deposit of
arrears of rent in Court by tenant under Section 20(4) before hearing of the D
suit-Entitlement to adjustment of rent paid under Section 30(2) in view of
language ofSection 20(4)-Held, deposit ofrent under Section 30(2) is deemed
to be payment to landlord and therefore, entitled to benefit of adjustment of
.....
rent-Hence, no default in payment of rent.

Interpretation of statutes: E
Harmonious construction-Held, all the related provisions in a statute
should be read together for proper and harmonious construction.

Municipal Board leased premises to respondents. The respondents
.. let out the premises on rent to appellants during the lease period. In 1971, F
on expiry of the lease, Municipal Board issued notices demanding rent
from the appellants. From 1971, the appellants deposited the rent in the
Court under Section 30(2) of the U.P. Urban Building (Regulation of
Letting, Rent and Eviction) Act 1972 i.e. on the ground of the doubt of
the recipient of the rent. The respondents filed a suit for eviction of the
appellants in trial Court on the ground of sub-letting and default in G
payment of rent from 1973 to -1975. The respondent did not claim the rent
from the appellants for the period from 1971 to 1973 being time barred.
The appellants deposited the arrears of rent in the trial Court under
section 20(4) of the Act before the hearing of the suit. The trial Court
dismissed the suit of the respondent. Revisional Court passed a decree for H
605
y

606 SUPREME COURT REPORTS [2002] I S.C.R.

A eviction of the appellants on both the grounds. The appellants filed a Writ
Petition before High Court. The High Court partly allowed the Writ
Petition on the question of sub-letting. However it dismissed the petition
as regards default in payment of rent holding that the amount deposited
. under Section 30(2) cannot be adjusted by the appellant on a plain reading
of Section 20(4) of the Act. The High Court further held that such benefit
B is available only for the deposit made under Section 30(1) of the Act i.e.
on the ground of refusal by the landlord to accept the rent.

Allowing the appeal, the Court

HELD : 1.1. Reading Section 30(6) of the U.P. Urban Building
C (Regulation of Letting, Rent and Eviction) Act 1972, it is clear that the •
effect of deposit under two different circumstances provided under
Sections 30(1) and 30(2) is the same. The deposit is deemed to be payment
made by the person depositing to the landlord. Omission of Section 30(2)
in Section 20(4) of the Act cannot lead to an inference which would negate
D or nullify the express and statutory effect provided under Section 30(6)
regarding deposits made under Section 30(2) of the Act Therefore, Section
20(4) will have to be read with Section 30(6) where it !'elates to deposit of
rent made under Section 30(2) of the Act. This would not be necessary in
case of deposits under Section 30(1) of the Act. The plain and natural
consequences statutorily provided should be allowed to flow irrespective
-
E of mention of Section 30(1) alone in Section 20(4) of the Act.
[611-8-C; E-F)

1.2. If the amount deposited under Section 30(2) is not deductible
under Section 20(4) like the deposit made under Section 30(1) and despite
F the deposit, the tenant is liable to be evicted on the ground of arrears of
•
rent, it would render Section 30(2) devoid of meaning and Section 30(6)
of the Act otiose. Double payment or deposit for the same period is not
envisaged nor it can be. Hence in construing the meaning of entire amount
due as occurring in Section 20(4) of the Act, Section 30(6) will have to be
read along with it and not in isolation. [613-B-CI
G 2.1. A provision in the statute is not to be read in isolation. It has to
be read with other related provisions in the Act itself, more particularly,
when the subject matter dealt with in different Sections or parts of the
same statute is the same or similar in nature. All the related provisions
have to be read together for the purposes of proper and harmonious
H construction. It is not only permissible but much desirable for proper

•
KAILASH CHANDRA v. MUKUNDI LAL [BRIJESH KUMAR, J.] 607

understanding of the contents and meaning of the provisions under A
consideration. Provisions of one Section of a statute cannot be used to
defeat those of another unless it is impossible to effect reconciliation
between them. (611-G-H; 612-B; 613-E)

R.S. Raghunath v. State of Karnataka & Anr., AIR (1992) SC 81; M
Pentiah & Ors. v. Muddala Veeramal/appa & Ors., AIR (1961) SC 1107; B
Gammon India Ltd. etc. etc. v. Union of India, AIR (1974) SC 960; Mysore
State Road Transport Corporation v. Mira Knasivali Ven, AIR (1977) SC 747;
Commissioner of Income Tax, Central Calcutta v. National Taj Traders, AIR
(1980) SC 485; Sultana Begum v. Prem Chand Jain, AIR (1997) SC 1006;
O.P. Singh/a & Anr. v. Union ofIndia & Ors., [1984) 4 SCC 450; Raj Krushna C
v. Vinod Kanungo, AIR (1954) SC 202; Sultana Begum v. Prem Chand Jain,
AIR (1997) SC 1006 and Mohd. Sher Khan v. Raja Seth, AIR (1922) PC
17, referred to.

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2354 of
1999. J)

- From the Judgment and Order dated 24.8.98 of the Allahabad High
Court in C.M.W.P. No. 6505 of 1980.

R.C. Srivastava, Ms. Rachna Srivastava and Ms. Rani Chhabra for the E
Appellants.

J.P. Goyal, Rameshwar Prasad Goyal and K.K. Gupta for the
Respondents.

The Judgment of the Court was delivered by F
BRIJESH KUMAR, J, This appeal has been preferred by the tenant
of the premises in question against the Judgement and Order passed by
Allahabad High Court dismissing appellant's Writ Petition, filed against the
order for his eviction passed in revision, on the ground of default in payment
~~· G
The Landlords, who are respondent Nos. 1-3 in the present appeal, filed
a suit for eviction of the appellant in the court of Judge, Small Causes,
Jaunpur. The ground for eviction on account of sub-letting !Jy the appellant/
tenant, was not accepted by the Trial Court, However, it was found that the
appellant-tenant was in arrears of rent, but decree of eviction was not passed, H
608 SUPREME COURT REPORTS [2002] I S.C.R.

A since the appellant paid the amount due on the first date of hearing in
accordance with Section 20(4) of the U.P. Urban Building (Regulation of
Letting, Rent and Eviction) Act 1972 (to be referred as Act). The Revisional
Court, however, upset the order passed by the Trial Court and passed decree
of eviction on account of arrears of rent as well as on the ground of sub-
B letting. The said order was upheld in the Writ Petition in so far it related to
default in payment of rent. The High Court, however, held that the Revisional
Court was wrong in substituting its own finding of fact regarding subletting,
in exercise of its revisional powers. Therefore, finding of the Trial Court on
the point of sub-letting stood restored.

C The learned counsel for the parties have confined their submissions
before us relating to the question as to whether the defendant-appellant had .
cleared the arrears of rent or not. In this connection, it may be indicated that
according to the respondent-plaintiff, the rent of the accommodation in question
was Rs. 18 per month. The tenant stopped payment of rent w.e.f. 1.6.1971,
but an amount of Rs. 443.50 paise was claimed on account of arrears of rent
D w.e.f. 15.12.1973 to 4.1.1975 and an amount of Rs. 240.50 paise on account
of mesne profit w.e.f. 5.1.1975 till 15.12.1976. It is further averred in the
plaint that rent for the period w.e.f. 1.6.1971 to 15.12.1973 was not being
claimed having become barred by time. According to the appellant-defendant,
he had deposited all the amount due in the Court on the first date of hearing
E complying with Section 20(4) of the Act and prior to that he had deposited
the rent under Section 30(2) of the Act. The property in question was on
lease with the landlord, granted by Municipal Board. On expiry of the period
of lease in the year 1971, the Municipal Board issued notice demanding rent
from the defendant. Therefore, the defendant-appellant resorted to the
provisions of Section 30(2) of the Act and started depositing the rent in the
F Court. Thus taking into account all the amounts deposited, nothing remained •
due to be paid to the plaintiff, therefore, decree of eviction could not be
passed.

The High Court came to the conclusions that benefit of deposit under
Section 30(2) of the Act could not be given to the tenant under Section 20(4)
G of the act and the tenant has to clear off all dues as standing against him
including the amount of arrears which may, though have become barred by
time. So far latter proposition is concerned, the High Court's view cannot be
faulted with. In regard to the amount deposited under Section 30(2) of the
Act, the High Court has held as follows:-

H "In view of the fact that the amount of rent which was deposited by
KAILASH CHANDRA v. MUKUNDI LAL [BRIJESH KUMAR, J.] 609

the tenant under Section 30(2) of the Act, on a plain reading of A
Section 20(4) could not be deducted or adjusted while making
complian.:e of the requirements contemplated under sub-section (4)
" as the provision makes reference only to adjustment of rent deposited
under Section 30(1) and not to deposits made under Section 30(2) of
the Act, the finding of the trial court extending benefit to the tenant
of Section 20(4) of taking into account the rent deposited by the B
tenant under Section 30(2) suffered from an apparent error of law
which error has been corrected by the Revisional Court by excluding
from consideration the said deposit for the purposes of judging the
compliance of the provisions of sub-section (4) of section 20 of the

.,.
Act. c
The view taken by the High Court, as indicated above, requires
examination though apparently on the face of it, it may seem to be correct.

Sub-section 4 of Section 20 reads as under:·
D
(4) In any suit for eviction on the ground mentioned in clause (a) of
sub-section (2), if at the first hearing of the suit the tenant
unconditionally pays or (tenders to the landlord or deposits In Court)
the entire amount of rent and damages for use and occupation of the
building due from him (such damages for use and occupation being
calculated at the same rate as rent) together with interest thereon at
E
the rate of nine per cent per annum and the landlord's costs of the
suit in respect thereof, after deducting therefrom any amount already
deposited by the tenant under sub-section (l) of Section 30, the Court
may, in lieu of passing a decree for eviction on that ground, pass an
•
order relieving the tenant against his liability for eviction on that F
ground:"

Section 30 of the Act reads as follows:-

30. Deposit of rent in Court in certain circumstances:-
G
{I) If any person claiming to be a tenant of a building tenders any
amount as rent in respect of the building to its alleged landlord
.... ..... and the alleged landlord refuses to accept the same then the
former may deposit such amount in the prescribed manner and
continue to d,;-osit any rent which he alleges to be due for any
subsequent period in respect of such building until the landlord H
y
610 SUPREME COURT REPORTS [2002] I S.C.R.

A in the meantime signifies by notice in writing to the tenant his
willingness to accept it.

(2) Where any bona fide doubt or dispute has arisen as to the person loo
who is entitled to receive any rent in respect of any building, the
tenant may like-wise deposit the rent stating the circumstances
B under which such deposit is made and may, until such doubt has
been removed or such dispute has been settled by the decision of
any competent court or by settlement between the parties, continue
to deposit the rent that may subsequently become due in respect
of such building.

c (3) The deposit referred to in sub-section ( l ), or sub-section (2)
shall be made in the Court of the Munsif having jurisdiction.

(4) On any deposit being made under sub-section ( l ), the Court
shall cause a notice of the deposit to be served on the alleged
landlord, and the amount of deposit may be withdrawn by that
D person on application made by him to the Court in that behalf.

(5) On a deposit being made under sub-section (2), the Court shall
cause notice of the deposit to be served on the person or persons
concerned and hold the amount of the deposit for the benefit of
the person who may be found entitled to it by any competent
E Court or by a settlement between the parties, and the same shall
be payable to such person.

(6) In respect of a deposit made as aforesaid, it shall be deemed that
the person depositing it has paid it on the date of such deposit
to the person in whose favour it is deposited in the case referred
F ~o in sub-section ( l) or to the landlord in the case referred to in
sub-section (2).

A perusal of sub-Section (4) of Section 20 of the Act, no doubt indicates
that the deduction of an amount from the total amount due is pennissible
only to the extent of deposit made under sub-section (l) of Section 30. It
G does not mention about the deposits made under sub-section (2) of Section
30 of the Act.

A tenant is required to make deposit, under sub-section (1) of Section ...,
.A
30 on refusal of the landlord to accept the rent. The deposit under sub-
section(2) of Section 30 is required to be made where any doubt or dispute
H arises as to the person who may be entitled to receive rent in which event,
KAILASH CHANDRA v. MUKUNDI LAL [BRIJESH KUMAR, J.] 611
the tenant may deposit the amount in the Court till such doubt has been A
removed or dispute has been settled. The effect of the deposits made under
sub-section (I) and (2) is to be found under sub-section (6) of Section 30
·-'
<Id according to which it shall be deemed that the person depositing the amount
has paid it on the date of deposit, to the person in whose favour deposit is
made under sub-section {l} and to the landlord in case deposit is made under
sub-section (2). It is thus clear that the effect of deposit under two different
B
circumstances as provided under sub-sections {l) and (2) of Section 30, is the
same. The deposit is deemed to be payment made by the person depositing
to the landlord. That being the position, it is not open to say that a deposit
made under sub-section (2) of Section 30 would not be deemed to be payment
or rent to the landlord and the same is not liable to be accounted for while c
considering the amount due. Omission of sub-section (2) of Section 30 in
sub-section (4) of Section 20 of the Act, cannot lead to an inference, which
would negate or nullify the express and statutory effect provided under sub-
section (6) of Section 30 regarding deposits made under Section 30 (2) of the
Act.
D
As a matter of fact, it would not at all be necessary to incorporate the
effect of sub-section (6) of Section 30 in sub-Section (4) of Section 20 of the
Act. The effect of sub-section (6) of Section 30 flows from the provision
itself. Therefore, sub-section (4) of Section 20 will have to be read with sub-
section (6) of Section 30 where it relates to deposit for rent made under sub- E
section (2) of Section 30, which it would not be necessary in case of deposits
under sub-section {l) of Section 30. The interpretation as accepted by the
High Court is unnatural and against the spirit and specific provision under
sub-section (6) of Section 30. There may or may not be a mention of sub-
section (2) of Section 30 in Section 20(4) the plain and natural consequences
F
. statutorily provided should be allowed to flow irrespective of mention of sub-
section {l) alone in sub-section (4) of Section 20. There cannot be converse
inference in the teeth of sub-section (6) of Section 30. Had sub-section (6)
of Section 30 been not there, it could perhaps provide some scope for such
• an inference .
G
A provision in the statute is not to be read in isolation. It has to be read
with other related provisions in the Act itself, more particularly, when the
subject matter dealt with in different Sections or parts of the same statute is
the same or similar in a nature. As in the case in hand, we find that the matter
relates to liability of the tenant to pay rent to the landlord and the consequences
on failure to do so as provided under Section 20(2)(a) of the Act. Sub-section H
612 SUPREME COURT REPORTS [2002] I S.C.R.

A (4) of Section 20 deals with payment of arrears of rent etc, at the first hearing
of the suit which in that event provides protection from eviction. Section 30
deals with the two circumstances in which, for one reason or the other, the
rent is deposited in the Court instead of payment to the landlord. As noted
earlier the effect of deposit of rent is provided under sub-section (6) of
B Section 30. Therefore, all the related provisions have to be read together for
the purposes of proper and harmonious construction. It is not only permissible
but much desirable for proper understanding of the contents and meaning of
the provisions under consideration. In R.S. Raghunath v. State of Karnataka
andAnr., AIR(1992) SC 81 it has been observed-"No part ofa Statutes and
no word of a Statute can be construed in isolation. Statutes have to be
C constructed so that every word has a place and everything is in its place''. In
M Pentiah and Ors. v. Mudda/a Veeramallappa and Ors. reported in, AIR
(1961) SC 1107, a reference was made to observations made by Lord Davey,
in Canada Sugar Refining Company v. R. (1898) AC P. 375 it reads as
follows:-

D "Every clause of a statute should be construed with reference to
the context and other clauses of the Act, so as, as far as possible, to
make a consistent enactment of the whole statute or series of statutes
relating to the subject matter''.

See also: Gammon India Limited etc. etc. v. Union ofIndia, AIR (1974)
E SC 960; Mysore State Road Transport Corporation v. Mira Khasivali Ven,
(1977) SC 747; Commissioner of Income Tax, Central Calcutta v. National
Taj Traders, AIR (1980) SC 485 and Sultana Begum v. Prem Chand Jain,
AIR (1997) SC 1006.

F In O.P. Singh/a and Anr v. Union ofIndia and Ors., [1984) 4 SCC 450
at 461 it has been observed:-

"One must have regard to the scheme of fasiculus of the relevant
rules or Sections in order to determine the two meanings of any one
or more of them and isolated consideration of a provision leads to
the risk of some other inter related provisions becoming OTIOSE or
G
devoid of meaning" (emphasis supplied).

In the background of what has been held by this Court in the cases
referred to in the preceding paragraph, it would only be proper rather necessary
to read sub-section (4) of Section 20 along with sub-section (6) of Section 30
H of the Act. Sub-section (4) of Section 20 provides for payment of entire rent
KAILA SH CHANDRA v. MUKUND! LAL [BRIJESH KUMAR, J.] 613

by the tenant at the first hearing of the Suit. It further permits, deduction of A
any amount therefrom which has already been deposited by the tenant under
sub-section (I) of Section 30. Sub-section (2) of Section 30 is omitted. The
effect of payment under sub-section (2) of Section 30 is that of payment by
the depositor to the landlord. If it is so, how the said amount can be treated
to be due from the tenant for payment to the landlord? If the amount deposited
under sub-sec. (2) is not deductible under sub-section (4) of Section 20 like B
the deposit made under sub-section (I) of Section 30 and despite the deposit
the tenant is liable to be evicted on the ground of arrears of rent, it would
render sub-section (2) of Section 30 devoid of meaning and sub-section (6)
of Section 30 otiose.

Double payment or deposit for the same period is not envisaged, nor
c
it can be, therefore, for construing the meaning of entire amount due as
occurring in sub-section ( 4) of Section 20 of the Act, sub-section (6) of
Section 30 will have to be read along with it and not in isolation. It would
also save sub-section (6) of Section 30 from becoming OTIOSE. The anomalies
and differentiation in the deposits made under sub-sections (1) and (2) of D
Section 30, though the effect is the same, would also be saved. It would only
.._ harmonize the construction of the two provisions, namely, sub-section (4) of
Section 20 and sub-sections (2) and (6) of Section 30 of the Act. Provisions
of one Section of a statute can not be used to defeat those of another unless
it is impossible to effect re-conciliation between them. (See Raj Krushna v. E
Vinod Kanungo, AIR (1954) SC 202 and Sultana Begum (Supra) as also
Mohd. Sher Khan v. Raja Seth, AIR (1922) P.C. Page 17.

We also find that there are certain observations made in the judgement
of the High Court for which there seems to be no basis. It is observed that
amount of arrears of rent w .e.f. 1971 to 1973 have not been deposited, F
namely, the amount which was left out to be claimed by the plaintiff being
barred by time it does not appear to be correct on the face of it. It has been
the case of petitioner that he had deposited the amount under sub-section 2
of Section 30 only when the Municipal Board demanded rent from the
defendant in 1971 on expiry of lease period of the plaintiff. It is nobody's G
case that amount deposited under sub-section 2 of Section 30 was any amount
other than for the period w.e. f 1971. It is also not understandable as to how
it has been observed by the High Court that even after the deposit made
under section 30 (2) is taken into account the time barred amount has not
been paid. It is not necessary for us nor it would be appropriate to go into
the details of the payments made but we find that the Trial Court observed H
614 SUPREME COURT REPORTS [2002) I S.C.R.

A that the defendant deposited Rs. 700 more than what was claimed in the
plaint. A total sum of Rs. 648 was demanded in the plaint, whereas the
amount deposited was 1510; Rs. 443.50 p. was demanded on account of
arrears of rent for the period from 15.12.1973 to 11.1.1975, thereafter, up to
I5.12.1976 a sum of Rs. 204.50 as mesne profit for use and occupation. Rent
B for the period 21.5 .1971 to 15 .12.1973 had become time barred. There was
admittedly a deposit made under Section 30(2) of the Act.

We again find that at one place the High Court has observed that the
Revisional Court made some observations that deposit under Section 30(2)
was not a bonafide deposit, hence it was not liable to be taken into account.
C No such question about the deposit under Section 30(2) being bonafide or
not, appears to have been raised before the Trial Court. No such issue was
framed, nor finding recorded either way and rightly. It is not understandable
how the observation came to be made by the Revisional Court for the first
time. There is no denial of the fact that the Municipal Board had also served
.. notice upon the defendant to make payment of the rent to it. It also does not
D appear that the plaintiff placed any document on the record to show that the
Court where the deposit was being made under Section 30(2) may have
rejected the petition for deposit holding it to be not bonafide. Such an
observation by the Revisional Court at the first insta1.ce is but only to be
ignored.

E In view of the discussions held above, we allow the appeal and set
aside the judgments and orders passed by the High Court and the Revisional
Court, and the order passed by the Trial Court is restored.

There would, however, be no order as to costs.

F B.S. Appeal allowed.