The Assam Urban Areas Rent Control Act, 1972- Important Provisions Part II

PROTECTION AGAINST ARBITRARY EJECTION under Section 5:

The general rule is that so long as the tenant pays standard rent, and performs the conditions of tenancy, he cannot be ejected,

But he may be ejected under the following special circumstances:-

(a) Where the tenant contravenes the provisions of clauses (m), (p), (o) of Section 108 of Transfer of Property Act.

According to these clauses, the lessee is bound to keep the land in good condition, as it was when the tenant took possession; he must not use the property for a purpose other than that for which it was leased, and he must not erect permanent structure without lessor’s consent.

(b) Where the tenant is guilty of causing nuisance or annoyance to others/neighbours, or

(c) Where the house is bona fide required by the landlord for repair or rebuilding or occupation of himself/ or any person for whose benefit the house is held, or for any other cause accepted by the court,

(d) Where the tenant sub-lets or transfers the house or a part without written permission of the landlord; or

(e) Where the tenant has not paid rent due, within 14 days of the rent falling due; or

(f) Where the tenant has built, acquired or been allocated suitable residence under Section 5(1).

It is for the landlord to satisfy the conditions specified in various clauses of the provision in Section 5(1). (Upendra Chandra v. Subhashini Deb) (FCI v. Bhagwan Shree)

GROUNDS OF ENHANCEMENT OF RENT & LIMITATIONS TO SUCH ENHANCEMENT

The standard rent is calculated based on the market value of the land and estimated cost of construction at the time of fixation of fair rent together with Municipal Tax and Urban Immovable Property Tax, payable in respect of the house, and it, therefore, does not connote a fixity of rent but is liable to alteration after the first fixation of the standard rent with the increase in the value of land and estimated cost of construction of the house.

The landlord can claim for rent at an increased rate in the following circumstances:-

(i) Under Section 5(1), an increase of rent or its revision can only be claimed after 5 years of continuous occupation of the house by the tenant after the last fixation of the standard rent.

A subsequent revision of rent can be claimed after the lapse of every five years of the last revision of standard rent. The increase in the rent will be subject to the following conditions:-

(a) Under Section 5 (1 )(a) stated that the rent cannot be increased by more than 50% of the proceeding standard rent fixed by the court; and

(b) Under Section 5 (1) (b) stated that the increase in the rent will be permissible if the market value of the land and the estimated cost of construction has increased by more than 35% of their value as of the date of the last fixation of fair rent, will be allowed to the extent of 1/12th of 7 ½% of such increase in the market value of the land and cost of construction.

(ii) Under Section 5(2) it stated that, if any improvement, addition or alteration has been effected to the house at the cost of the landlord, after the fixation of the standard rent, then the monthly rent can be increased to the extent of 1/12th of 7 ½% of such improvement, addition or alteration, and such increase will be effective from the date, when the addition, alteration or improvement was effected stated under Section 3(3).

(iii) If after the fixation of the standard rent, there is variation in the Municipal and Urban Immovable Property Tax, the standard rent will be liable to fix again, taking into account the variations of these taxes.

PROVISIONS OF RENT UNDER THE ACT and IMPORTANT TERMS

The term was not discussed under this act, or the old act and hence the term ‘rent’ seems to have been used in its ordinary dictionary meaning.

The term is comprehensive enough to include all payments made by the tenant to a landlord, for the use and occupation, not only of the building and its appurtenances but also of furnishing, electric installations and other amenities as agreed to by the parties, to be provided by and at the cost of the landlord.

In a wider sense, the term ‘RENT’ implies the payment made for the use of land or buildings, and this includes the payment by a license in respect of the use and occupation of any land or building. In its narrow sense, it means payment by a tenant to a landlord for property demised to him. (Konchada Ramamurthy v. Gopinath)

• PUCCA STRUCTURE under Section 2(d)

A pucca structure for the act means, a structure built with the following materials:-

(i) Commented or wooden floor

(ii) Iron, brick or concrete posts

(iv) Roof of reinforced concrete posts, and/or, of galvanized iron, aluminium or asbestos sheet

• STANDARD RENT under Section 2(e)

Section 3 prohibits claiming or receiving rent above the standard rent and as the fair rent is to be fixed within this permissible limit.

The standard rent has between defined as the annual rent which is a total of the following amount:-

(i) 7 ½% of the aggregate amount of-

(a) Cost of construction of the house

(b) Market price of the land

(ii) The municipal taxes

(iii) Urban immovable property tax payable in respect of the house. The monthly rent of the house shall be 1/12th of the annual rate.

• FAIR RENT under Section 3:

Fair rent of a house has not been defined as such, but the rent will be treated as fair rent if- it is an amount not exceeding the standard rent.

Section 3 provides that a landlord cannot demand/claim a rent higher than the standard rent. Section 3 has an overriding effect (on rent) as it will prevail over any contract concerning rent.

The fair rent is to be determined as per provisions of this act and cannot be circumvented.

OBLIGATIONS OF A LANDLORD TOWARDS THE TENANT

The obligations of the landlord have been discussed under Section 6 of the act, and these are certain duties of the landlord towards the house, let out to a tenant.

DUTIES which are required to be performed by the landlord are three-fold:

1. The landlord is bound to keep the house, windproof and waterproof, in case of occupation by a tenant.

2. The landlord is required to carry out other repairs which he is bound to make by law, contract or custom. The word repair, however, includes – annual whitewashing and re-colouring.

3. The landlord is required to maintain the existing essential supplies and services such as sanitary arrangement, water supply, supply of electricity or drainage in respect of the house.

Under Section 6, a landlord is bound to maintain existing essential supplies and services such as sanitary arrangements, water supply, supply of electricity and/or drainage systems.

Such maintenance of essential services is not meant to be governed by any contract or customs.

The landlord must see that the supply of the essential services is not disrupted and in case of such discontinuation, it is the bound/binding duty of the landlord to make good of it, either by repair or by replacement.

(Ramji Lal Sharma v. Purushottam Lal Sharma)

Thus, since the landlord is entitled to recover additional costs, then he must also be duty-bound to perform the obligations upon him.

REMEDIES FOR ENFORCEMENT OF OBLIGATIONS BY THE LANDLORD TOWARDS THE TENANT:

If the landlord fails to carry out repairs and maintenance, and other duties as mentioned under Section 6, the tenant may apply to the court, and the court may direct the landlord to appear before the court and show cause.

If the landlord fails to show sufficient cause, the court may direct him to make essential repairs and restore the essential services and supplies within a period fixed by the court.

If the landlord fails to comply with that direction, the court may allow the tenant, on his application, to these at a cost determined by the court.

Under Section 7, the tenant may deduct the cost from the rent or may recover the said cost from/through the court, by execution of a decree.

However, Section 7 does not allow the tenant to act suo moto and adjust any rent. It would be only with the permission of the court.

Where the landlord fails to perform his duty under Section 6, the only remedy for the tenant is Section 7, under which he can make an application, complaining neglect on the part of the landlord to perform his duties.

The procedure to be adopted by the court, under Section 7 is not very speedy and the tenants, generally living with their families, cannot afford to remain without such essential supplies like water and electricity for a long time.

Such delay is likely to cause the tenant to fall prey to the dictations of the landlord.

CONCLUSION

Ever since the population explosion and globalisation, masses of people have moved to urban areas in the search of jobs, quality education as well as healthcare. Since a large population are temporary settlers, house-rents have become a household term as well as a source of income for people who own real estate in these urban centres.

The state of Assam, therefore, passed this Act to protect the rights of both, the landlords and the tenants, and at the same time, also set certain ground rules in the form of fixity of rent, compulsory services to be provided by the landlord and protection from ejection to the tenants.

The legislation is very important as it regulates and monitors the tenant-landlord relationship and adds a certain legal aspect to the process of lending one's house for rent.

The link to the previous part is here- The Assam Urban Areas Rent Control Act,1972- Important Provisions- Part I