Section 27 of Delhi Rent Control Act, 1958 - Deposit of Rent by the Tenant

Section 27 provides a statutory method for a tenant to deposit rent with the Rent Controller when rent has been properly tendered but the landlord does not accept it, the landlord refuses or neglects to issue the receipt contemplated by Section 26, or there is a bona fide doubt about the person entitled to receive the rent.

Meaning and purpose of Section 27

The provision protects the rent-payment process where direct payment to the landlord cannot effectively be completed for one of the reasons specified by the Act. A deposit must comply with the statutory conditions and the prescribed procedure. Section 27 should therefore be read together with Section 26, Section 28 and Section 29.

When may a tenant deposit rent?

Related time limit: Section 28 states that a deposit under Section 27 is not treated as valid unless it is made within twenty-one days of the time referred to in Section 26 for payment of rent. Tenants should therefore pay close attention to both the reason for deposit and the statutory timing.

Statutory text of Section 27

(1) Where the landlord does not accept any rent tendered by the tenant within the time referred to in section 26 or refuses or neglects to deliver a receipt referred to therein or where there is a bona fide doubt as to the person or persons to whom the rent is payable, the tenant may deposit such rent with the Controller in the prescribed manner:

Provided that in cases where there is a bona fide doubt as to the person or persons to whom the rent is payable, the tenant may remit such rent to the Controller by postal money order.

(2) The deposit shall be accompanied by an application by the tenant containing the following particulars, namely:--

(a) the premises for which the rent is deposited with a description sufficient for identifying the premises;

(b) the period for which the rent is deposited;

(c) the name and address of the landlord or the person or persons claiming to be entitled to such rent;

(d) the reasons and circumstances for which the application for depositing the rent is made;

(e) such other particulars as may be prescribed.

(3) On such deposit of the rent being made, the Controller shall send in the prescribed manner a copy or copies of the application to the landlord or persons claiming to be entitled to the rent with an endorsement of the date of the deposit.

(4) If an application is made for the withdrawal of any deposit of rent, the Controller shall, if satisfied that the applicant is the person entitled to receive the rent deposited, order the amount of the rent to be paid to him in the manner prescribed:

Provided that no order for payment of any deposit of rent shall be made by the Controller under this sub-section without giving all persons named by the tenant in his application under sub-section (2) as claiming to be entitled to payment of such rent an opportunity of being heard and such order shall be without prejudice to the rights of such persons to receive such rent being decided by a court of competent jurisdiction.

(5) If at the time of filing the application under sub-section (4), but not after the expiry of thirty days from receiving the notice of deposit, the landlord or the person or persons claiming to be entitled to the rent complains or complain to the Controller that the statements in the tenant's application of the reasons and circumstances which led him to deposit the rent are untrue, the Controller, after giving the tenant an opportunity of being heard, may levy on the tenant a fine which may extend to an amount equal to two months' rent, if the Controller is satisfied that the said statements were materially untrue and may order that a sum out of the fine realised be paid to the landlord as compensation.

(6) The Controller may, on the complaint of the tenant and after giving an opportunity to the landlord of being heard, levy on the landlord a fine which may extend to an amount equal to two months' rent, if the Controller is satisfied that the landlord, without any reasonable cause, refused to accept rent though tendered to him within the time referred to in section 26 and may further order that a sum out of the fine realised be paid to the tenant as compensation.

Application particulars under Section 27(2)

The tenant's application identifies the premises and rental period, gives the name and address of the landlord or other claimant, explains why the deposit is being made, and supplies any additional prescribed particulars. Accurate particulars matter because Section 28 separately addresses the consequences of wilfully false statements in an application for deposit.

Withdrawal, hearing and competing claims

Under Section 27(4), the Controller may order payment of deposited rent to a person found entitled to receive it. Where the tenant has named more than one person as claiming entitlement, those persons must be given an opportunity of being heard before payment is ordered. The Controller's order does not finally determine competing civil rights to the rent; those rights may be decided by a competent court.

Fine and compensation

Section 27 contains safeguards for both sides. Materially untrue statements by a tenant about the reasons for deposit can lead to a fine extending to two months' rent. Conversely, a landlord who, without reasonable cause, refuses rent properly tendered within the Section 26 period may also face a fine extending to two months' rent. In either situation, the Controller may direct that a sum out of the fine realised be paid as compensation as provided by the section.

Official text and legal reference

For the current official text of the Central Act, amendments and authoritative legislative reference, see the Delhi Rent Control Act, 1958 on India Code. This page is an informational article and should be read with the Act, applicable rules, amendments and relevant judicial decisions.

Amendment note: the proviso concerning remittance to the Controller by postal money order in cases of bona fide doubt was inserted with effect from 1 December 1988.