Supreme Court rules that tenants cannot avoid eviction by claiming pending litigation when they failed to pay fair rent determined by Rent Controller and didn't seek stay orders - belated payment after 6 years constitutes wilful default under Tamil Nadu Rent Control Act.
Can tenants avoid eviction by claiming pending litigation about fair rent without actually paying the determined fair rent amount?
No, failure to pay determined fair rent without obtaining stay orders constitutes wilful default.
The Supreme Court has affirmed eviction on grounds of wilful default because:
The court upheld the concurrent findings of appellate authority and High Court that the tenant committed wilful default under Section 10(2)(i) of Tamil Nadu Rent Control Act, 1960.
Original Lease: Multiple portions leased totalling 15,500 sq. ft. with rent dispute (Rs. 48,000 vs Rs. 33,000 claimed)
Fair Rent Fixed: Rent Controller fixes fair rent at Rs. 2,43,600 p.m. payable from Feb 2005 - arrears of Rs. 68,87,400
Appeal Dismissed: Appellate authority confirms fair rent - tenant continues paying only original rent
High Court Revision: High Court reduces fair rent to Rs. 2,37,500 p.m. - legal notice for Rs. 1,22,22,000 arrears issued
SLP Dismissed: Supreme Court dismisses special leave petitions, directs instalment payments "without prejudice"
Final Payment: Tenant makes full payment nearly 6 years after fair rent determination
Supreme Court Judgment: Upholds eviction for wilful default, grants 6 months to vacate
| Situation | Your Rights | Required Action |
|---|---|---|
| Tenant not paying determined fair rent | File eviction petition for wilful default under Section 10(2)(i) | Provide evidence of fair rent order and non-payment |
| Tenant paying only original rent after determination | Still constitutes wilful default for difference amount | Issue legal notice demanding full fair rent payment |
| Tenant challenging fair rent but not paying | Wilful default established if no stay obtained | Proceed with eviction despite pending appeals |
| Tenant makes belated payment after years | Payment doesn't cure wilful default already committed | Continue eviction proceedings for past default |
Conscious, deliberate, intentional non-payment of rent despite capacity to pay. Different from mere inability or bona fide dispute.
Rent determined by Rent Controller under rent control legislation, considering various factors like location, construction cost, etc.
Legal term meaning actions don't affect legal rights. Payments made "without prejudice" preserve right to claim wilful default.
Court order temporarily stopping implementation of another court order. Must be specifically sought, not automatic with appeal.
"Proceedings do attain finality even at the level of the high courts, or the district courts or the trial courts if the immediate next superior forum is not approached by the party suffering the decree/order of the court seized of the lis. However, the principle of finality of a judicial decision would have no applicability in a situation where a party, despite owing money (unpaid rent, here) to his adversary in terms of a judicial determination, approaches the superior forum but prefers not to seek a stay of such determination pending the proceedings leaving the other party deprived of the benefits flowing from the said judicial determination."
"The bogey of judicial finality cannot, thus, be pressed into service to unfairly deny a party the benefits of a judicial decision, operation of which does not suffer from any interdiction by the superior court."
This judgment reinforces that tenants cannot use pending litigation as an excuse to avoid paying determined fair rent. The legal system provides mechanisms like stay applications to protect rights while challenging orders, but these must be actively pursued rather than assumed. Wilful default is established when tenants, despite capacity to pay, deliberately withhold payment for years while enjoying the property.
This content is for informational purposes only and does not constitute legal advice. Consult a qualified legal professional for specific legal guidance. The information provided is based on judicial interpretation and may be subject to changes in law.
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This analysis decodes a complex property law judgment to help both tenants and landlords understand their rights and obligations in fair rent disputes and wilful default cases.