May 27, 2020
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No Room For Change

A move to alter the rent act fires passions in the crowded metro

No Room For Change
outlookindia.com
-0001-11-30T00:00:00+0553

IN Mumbai, a move to change the existing Rent Act is tantamount to inviting instant political death. When the Supreme Court, ruling on a petition filed by the Property Owners' Association, asked the state government to frame a new legislation before the term of the existing Bombay Rent Act expires on March 31, it was like handing out a sentence.

The state's move will affect the lives of 2.5 million of the city's tenants. And reactions have been getting stronger as the deadline approaches—petitions have been mounting before the Supreme Court seeking a review of its decision and a spate of meetings, protests as well as a bandh.

The move, according to analysts, has already cost the ruling Shiv Sena-BJP combine two seats in Parliament—South Mumbai and Mumbai North Central. A third, Mumbai South Central, which it won by a mere 153-vote margin, has been challenged. "The Opposition has made a lot of hue and cry about the (Supreme Court) judgement.... This became an election issue.... The Opposition has alleged that the tenants will be thrown out of their houses and will be on the streets," says the state government's review petition which seeks nine months to frame a new rent control law.

Among the petitioners is the Federation of Old Buildings Cooperative Housing Societies, an association of tenants. The federation is among those who have expressed dissatisfaction with the government's inconsistent stand. "How can the government protect us when it is with the landlord? Even the Supreme Court has noted that the government thinks the rent act is unreasonable and requires reconsideration," says federation president Anil Goenka.

Like its mix of skyscrapers and shanties, the city's tenants are no homogenous lot. They range from the poor, extremely poor, the rich and famous, to traders and hoteliers. Last week, restaurateurs, traders and a hundred wholesale markets belonging to some 750 trade organisations closed shop for a day in response to a call by their powerful apex body, the Federation of Associations of Maharashtra. The protest was particularly effective in crowded south Mumbai—which has about one lakh traders and hoteliers—where most of the commercial establishments operate out of rented premises. Most fall into the (trade) category of tenants who have moved into the premises paying illicit transfer fees or pugree, a term surviving from the pre-briefcase days when money for such transactions was hidden under the turban. The other tenants live on rents virtually frozen since the Rent Control Act came into effect on September 1, 1940.

"Does the government intend giving a stick to unscrupulous landlords to dishouse poor tenants?" asks Kanti Desai, son of Morarji Desai. The late prime minister was among Mumbai's more famous tenants. He fought to stay in his south Mumbai apartment for nearly two decades. The case which began in Mumbai's Small Causes Court in 1966 and went up to the Supreme Court, ended in a decision against Morarji Desai. An appeal allowed him another five years in the 3,300 sq feet flat in 'Oceana', a building on Mumbai's picturesque Marine Drive. But the former PM later had to move to a flat provided by the state government, which has since been vacated by the family.

Tenants argue that landlords have earned many times their money from the buildings: land was virtually free—80 per cent of the land is on long lease and 20 per cent freehold. Construction costs were around Rs 10 per sq foot at the time; besides one third the money on every pugree transaction.Landlords, on the other hand, feel the rents they receive are abysmal and beyond reason. Says south Mumbai landlord, Jamshed Irani: "I get 7 paise per sq foot. My flats are 2,000 sq feet each—is Rs 140 reasonable? Even 10 times that is not. This kind of controlled rent has set off negative trends and initiated all sorts of anti-social practices." These include:

  •  200,000 flats locked up.
  •  19,642 dilapidated buildings which landlords have no incentive to maintain.
  •  Owners have changed many times, bringing in the mafia.

    The connection with the underground was underlined last month when a south Mumbai builder was killed, allegedly by the men he hired to get rid of his tenants. And two years ago, Ramesh Kini, a middle-class tenant involved in a battle against eviction, was murdered. His landlord's link with the Thackerays is a dark spot the family has not been able to erase from public memory.

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