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Eviction of tenant | Adjustment of pagri amount at the time of eviction

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Eviction petition—‘Pagri’ amount, payment of—Court below held that landlord was liable to return lump sum pagri amount of Rs. 500,000/- (Rs. 250,000/- for each shop) to the tenant—Validity—Half of the market value of shops had been paid as pagri to the landlord—Pagri amount paid for one shop was Rs. 75000/- and for other Rs. 250000/—Pagri amount was neither a security deposit nor the same could be adjusted against rent—Landlord could not be debarred from institution of eviction proceedings merely because pagri amount had been paid—Rent Tribunal while deciding eviction petition should have decided the issue of return or confiscation of amount of pagri—Punjab Rented Premises Act, 2009, in absence of any agreement to the contrary, did not recognize any automatic increase in the amount of pagri or its return at the prevailing market value of demised premises when eviction order was passed—No written agreement for return of pagri amount at 50% of prevailing market value of demised premises was on record—Exact amount of pagri paid at the time of tenancy had been established and tenant was bound to receive the same and not as 50% of present market value of the demised premises or any additional amount over and above pagri amount paid—Impugned order passed by the Court below was neither supported by record nor based on law which was set aside and pagri amount was reduced—Constitutional petition was disposed of, accordingly.
Eviction of tenant—Tenant had paid amount of Pagri to the landlord—Adjustment of pagri amount at the time of eviction—Scope—“Pagri”—Connotation. The pagri is neither a security deposit nor it could be adjusted against rent, hence landlord could not be debarred from institution of eviction proceedings merely because pagri was paid. Further before Act of 2009 as there was no legal recognition of “Pagri”, it could not be enforced through process of Court in eviction petition. However, in Act of 2009 for the first time, the term “Pagri” has been provided statutory protection and section 2(e) define the term “Pagri” includes any amount received by a landlord at the time of grant or renewal of a tenancy except advance rent or security. Therefore, now under Act of 2009, the rent Tribunal while deciding the rent petition is bound to decide the issue of return or confiscation of the amount of Pagri. However, in absence of any agreement to contrary, the law including Act of 2009 does not recognize any automatic increase in the amount of pagri or its return at the prevailing market value of the rented property when eviction orders is passed.

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