Does an Appellate Authority under Section 18 of the Kerala Rent Control Act need to repeat the Section 12(1) deposit procedure when challenging an eviction order under Section 12(3)?

 

Summary

Category Data
Court Supreme Court of India
Case Number C.A. No.-013901-013902 – 2025
Diary Number 32735/2025
Judge Name HON’BLE MR. JUSTICE MANMOHAN
Bench

HON’BLE MR. JUSTICE RAJESH BINDAL

HON’BLE MR. JUSTICE MANMOHAN

Concurring or Dissenting Judges Concurring: Hon’ble Mr. Justice Rajesh Bindal
Precedent Value Binding
Overrules / Affirms

Overrules the Kerala High Court’s order dated 22 May 2025

Affirms Manik Lal Majumdar v. Gouranga Chandra Dey

Type of Law Statutory interpretation of the Kerala Buildings (Lease & Rent Control) Act, 1965
Questions of Law Whether fresh application under S.12(1) is mandatory before the appellate authority when challenging a S.12(3) eviction
Ratio Decidendi
  1. Sections 12(1)–(3) empower the Rent Controller to require deposit/payment and, on non-compliance, to stop proceedings and evict under S.12(3).
  2. The appellate authority under S.18 is not a court of first instance and need not re-run the section-12 procedure; it only tests the legality of the Rent Controller’s order.
  3. While it may permit or dispense with deposit, or extend time, repetition of S.12(1) is only required where a supervening event (e.g., further rent accrual) occurs during the appeal.
  4. A literal demand for fresh compliance would lead to absurdity and undermine summary eviction, conflicting with statutory purpose and established precedents.
Judgments Relied Upon
  • Manik Lal Majumdar & Ors. vs. Gouranga Chandra Dey & Ors., (2005) 2 SCC 400
  • Lifestyle Equities & Anr. vs. Amazon Technologies Inc., 2025 SCC OnLine SC 2153
Logic / Jurisprudence / Authorities
  • Textual reading of S.12(1)–(3) and S.18 of the Act
  • Presumption against absurdity (R v. Alfred Skeen & Freeman; R. (Noone) v. Governor of HMP Drake Hall)
  • Analogy to summary orders under CPC
Facts as Summarised by the Court

The tenant withheld rent for two shops in Kochi since early 2020. Landlords obtained a money decree in OS No. 71/2021, then eviction orders under S.12(1) and, on non-payment, S.12(3). Appeals under S.18 were stayed for non-deposit. The Kerala High Court set aside that stay; this appeal challenges that order.

Practical Impact

Category Impact
Binding On All subordinate courts
Persuasive For Rent Control Appellate Authorities and other High Courts
Overrules Kerala High Court judgment dated 22 May 2025 in RCREV Nos. 102/2025 & 114/2025
Distinguishes Full Bench Kerala High Court in Zeenath Ibrahim v. Joy Daniel (2024 SCC OnLine Ker 6489)
Follows Manik Lal Majumdar & Ors. vs. Gouranga Chandra Dey & Ors.

What’s New / What Lawyers Should Note

  • A fresh application under Section 12(1) is not a pre-condition in every appeal under Section 18 challenging an eviction under Section 12(3).
  • The appellate authority’s role is to test the Rent Controller’s order; it need not repeat the entire Section 12 summary process.
  • Section 12(1) applications may be entertained on appeal only to address supervening events (e.g., subsequent rent accrual).
  • Mechanical re-running of the deposit procedure would produce absurd and unjust results, undermining the statute’s summary nature.
  • Citations: Use this decision to counter procedural objections seeking fresh S.12(1) compliance at the appellate stage.

Summary of Legal Reasoning

  1. Statutory Text and Purpose

    • Sections 12(1)–(3) set a one-time pre-condition of deposit/payment of admitted arrears; failure authorizes summary eviction.
    • Section 18 confers appellate jurisdiction to test legality, not rehear facts.
  2. Role of Appellate Authority

    • Can stay, extend time, or direct payment but need not repeat section-12 procedure mechanically.
    • A fresh S.12(1) application is permissible only where new rent accrues after filing the appeal.
  3. Avoiding Absurdity

    • Literal repetition would require the same summary procedure for every appeal, analogous to re-filing CPC orders, leading to delay and injustice.
    • Courts must interpret statutes with empathy, avoiding absurd consequences.
  4. Precedents

    • Manik Lal Majumdar: “appeal may be presented without deposit, but Appellate Authority can defer hearing until deposit.”
    • Lifestyle Equities: rarity of staying money decrees without patent illegality.

Arguments by the Parties

Petitioners (Landlords)

  • Reliance on Manik Lal Majumdar: material on record (money decree) shows admitted arrears; “prefer” means deposit as pre-condition for filing appeal.
  • No statutory basis for fresh Section 12(1) at appellate stage.

Respondent (Tenant)

  • Section 12 grants concurrent power; appellate authority must follow full summary procedure (including fresh S.12(1)).
  • Cited Zeenath Ibrahim Full Bench: S.12(1) maintainable in appeal; eviction on non-deposit in appeal without fresh notice was unlawful.
  • Appellate order gave only four days for deposit, not four weeks as Section 12(2) provides.

Factual Background

The tenant leased two shops in central Kochi, paid no rent since January/February 2020, prompting landlords to file eviction petitions under S.11 and a recovery suit (decree ₹26.44 lakhs). The Rent Controller under S.12(1) directed deposit of arrears; tenant failed, triggering S.12(3) eviction orders on 7 Nov 2024. Appeals under S.18 were stayed by the Appellate Authority for non-deposit. The Kerala High Court set aside that stay; the landlords moved to the Supreme Court.

Statutory Analysis

  • Section 11: Eviction procedure on non-payment of rent.
  • Section 12(1): Tenant must deposit all admitted arrears and continue payment to contest; Section 12(3): non-compliance stops proceedings and evicts.
  • Section 18: Appeals to Appellate Authority with power to test legality, not to replicate first-instance summary process.

Dissenting / Concurring Opinion Summary

  • No dissent; both Justices agreed.
  • Concurring: emphasis on purposive interpretation and avoidance of absurd results.

Procedural Innovations

  • Clarifies that appellate stage need not mechanically repeat the deposit/deposit-notice cycle under Section 12(1).
  • Affirms discretionary power of Appellate Authority to manage interim payments and stays.

Alert Indicators

  • 🚨 Breaking Precedent – Overturns Kerala High Court’s requirement of fresh Section 12(1) application on appeal
  • ✔ Precedent Followed – Affirms three-judge precedent in Manik Lal Majumdar
  • 🔄 Conflicting Decisions – Resolves conflict with Kerala Full Bench in Zeenath Ibrahim v. Joy Daniel

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