PEAL from a judgment of the District Court, Colombo.
W. Jayewardene, Q.C., with ilf. L. de Silva and Ben Eliyatamby, forthe defendant-appellant.
C. Ranganathan, Q.C., with W. S. Weerasooria, Oamini Dxssanayakeand K. Kanakaratnam, for the plaintiff-respondent.
Cur. adv. milt.
December 30, 1971. Samebawiokbamb, J.—
The question that arises in this appeal is whether the occupier of a partof premises which are admittedly excepted premises may claim theprotection of the Rent Restriction Act when sued in ejectment. Thedefendant appellant company was in occupation of part of premisesbearing No. 267, Kollupitiya Road, Colombo, paying a monthly rentalof Rs. 600 25. The annual value of premises No. 267, Kollupitiya Roadas assessed by the Colombo Municipal Council was Rs. 12,000 for theyear 1962 and Rs. 13,500 for the years 1963-66. The said premisesNo. 267 are therefore excepted premises.
Learned counsel for the defendant-appellant submitted that the partof the building of which the defendant is in occupation fell within thedefinition of premises in the Act. Premises are defined in the Act tomean, “ any building or part of a building together with the landappertaining thereto Section 2 (4) provides that the Act would applyto all premises in any area in which the Act is in operation which are notexcepted premises. The criterion of a premises being excepted premisesis the assessment of an annual value over a certain amount. As the partof the building which the defendant is in occupation has no annual value,it is submitted by learned counsel for the defendant-appellant that theyare not excepted premises and are therefore premises to which the Actapplies. The reference in the proviso to s. 5 (2) to premises which are“ first separately assessed after the appointed date ” supports thisposition. I was attracted by the argument of the learned counsel for thedefendant-appellant. If the position is aB contended for by him, it hasthe merit of preventing a possible abuse by owners or tenants of exceptedpremises lettibg to others a small part of the premises which if they wereseparate premises would clearly fall within the Act at rents quite out ofproportion to rents chargeable in terms of the Act. It may howeverbe that the remedy against such an abuse is for the Local Authority tomake a separate assessment in respect of any such parts of premises letand the local authority no doubt does generally do so.
Learned counsel for the plaintiff-respondent submitted that if a premisesare excepted premises the Act would not apply to any part of them. Itwas the intention of the Legislature not to exercise control over a certaincategory of premises. In respect of such premises an annual value in
SAME RAWICKRAME, J.—Plati Ltd. v. Ceylon Theatres Ltd.
excess of the amount set out in the schedule is assessed by the localauthority and that annual value is in respect of the entirety of suchpremises and therefore covers and applies to each and every part of thepremises.
After careful consideration I have come to the view that to accept theposition of learned counsel for the appellant would be to give to theprovisions of the Act a meaning which they were not intended to bear.The scheme of the Act suggests that it was intended that the criterion fordeciding whether premises were excepted premises was to be the amountof the annual value assessed by the local authority. Once a premiseswere excepted premises on the application of that test there is no supportto be found in the Act for the position that a part of those premises couldbe premises to which the Act applies unless that part was separatelyassessed. Section 7 provides for the aggregate rent .which may be chargedwhere premises to which the Act applies are let or occupied in separateparts which are not separately assessed for the purpose of rates.
There are also anomalies that will arise if parts of excepted premiseswhich are not separately assessed are regarded as premises to which theAct applies. As there is no annual value in respect of the part, thelandlord and the tenant may legally agree upon any rent and thereforeat a rent even in excess of the annual value of the entire premises. Thisappears untoward in respect of premises governed by the Act. A partof excepted premises may be able to command a rent of over Rs. 600 permonth and would, therefore, if separately assessed, be excepted premises.Merely because the assessment made by the“Local Authority is in respectof the entire premises it will be protected premises._ The part of theexcepted premises occupied by the defendant-appellant is an instance ofsuch a case. The monthly rental of that part of the premises is Rs. 600-25and if the annual value of this part of the premises was assessed on. thatfooting separately it would be excepted premises.
Learned counsel for the defendant-appellant submitted that for thepurposes of the Act it was the unit of letting that should be the premises.The definitions of residential and business premises show that the natureof the occupation is relevant and iB to be taken into account. There isnothing in the Act to suggest that the unit of letting is to be the premises.On the other hand the references in sections 7 and 9 to premises let inparts or in part suggest otherwise. I
I am therefore of the view that the finding of the learned District Judgethat the subject matter of the action was excepted premises is correctand that the order for ejectment was rightly made. The rent paid wasRs. 600-25 per month but the plaintiff claimed damages at Rs. 1,200-50per month. The learned District Judge has granted the damages claimed.Learned counsel for the defendant-appellant submitted that there wasno evidence to prove the damages and learned counsel for the plaintiff-respondent stated that he could not support the award of damages atthat figure. He was content that damages should be at the rate of
O. P. A. 8ILVA, J.—Sugaihopala v. Stand
Rs. 600-28 per month. The damages for the period 1.3.61 to 30.6.62amounts to Rs. 9,604 00. It is stated in the plaint that the defendanthad paid a sum of Rs. 8,403-60. The plaintiff-respondent will thereforebe entitled to Rb. 1,200-50 as balance arrears of damages up to 30th June,1962, together with further damages at Rs. 600 26 per month from 1stJuly, 1962, until the plaintiff, is restored to possession. The defendantappellant will be entitled to credit for all other payments in respect ofdamages made by it. The decree entered in this case will be variedin regard to the award of damages accordingly. Subject to suchvariation of the decree the appeal is dismissed with costs payable to theplaintiff-respondent.
N. G. Fernando, C.J.—I agree.
Alles, J.—I agree.
Appeal mainly dismissed.