LANDLORD Herpal Singh admitted yesterday that he had not returned the deposits to the families of two students who died in a fire in one of his flats.

Mr Singh, 47, a landlord for 25 years, collected #30,000 a year from the flats where the boys died. But 18 months later, he admitted he has not returned the #450 deposit to the boys' families.

Mr Singh, who owns more than 20 flats in Glasgow, was being questioned during at the fatal accident inquiry at Glasgow Sheriff Court. Mr Singh was warned on four separate occasions by the fiscal and Sheriff Charles McFarlane QC of the dangers of committing perjury.

Mr Singh, of Monreith Road, Newlands, also admitted that for 13 years he ran some of his flats for multiple occupancy despite the fact he had been refused planning permission.

The inquiry is into the deaths on March 4 last year of friends Mr James Fraser, of Balmaha, and Mr Daniel Heron, of Kippen, Stirlingshire, both aged 20, in the basement of one of Mr Singh's flats at 6 Melrose Street, Woodlands. A third student, Mr Christopher Lewis, 21, survived the blaze.

The inquiry heard that all the windows in the basement flat had bars on them and that there was only one smoke detector which had been dismantled and had no batteries.

Yesterday, Mr Singh was questioned in detail by procurator-fiscal depute John Service about the smoke detector. The landlord claimed there were two detectors - the one found by fire investigators lying dismantled on top of a freezer in the kitchen and another.

The second, he claimed, had been attached to the hall ceiling more than a year ago.

Mr Service said: ''Are you sure about the smoke detector being in the hall? Could you be confused with another of your flats?''

Mr Singh replied: ''I am sure''.

At this point Sheriff McFarlane warned him: ''There will be serious consequences for you if you are found to be telling lies under oath at this inquiry into the deaths of these two young men.''

Mr Service told Mr Singh: ''I am asking you to think carefully and long and hard before you answer. There is no evidence from the boy who survived or the fire investigation officer of a second smoke detector.'' Mr Singh insisted: ''The day before I gave the flat to the two boys there were two smoke alarms in the flat.''

The sheriff then asked: ''Can you give an explanation to this inquiry as to why there has been no evidence of any second smoke detector, and why the families who visited the flat say there was no second detector?''

Mr Singh replied: ''I only know the one in the kitchen was working.'' He was again warned by the sheriff about perjury.

Giving him ''one final chance'' to answer if there was a smoke alarm on the ceiling Mr Singh replied: ''There was on the day I visited the flat.''

Mr Singh told the inquiry that just five days before they died Mr Heron and Mr Fraser gave him #900, half for the deposit and half for a month's rent in advance.

Asked by procurator-fiscal depute John Service if he still had the deposit, Mr Singh admitted he had. ''Have you made any attempt to return it to the families?'' asked Mr Service. ''No,'' replied Mr Singh. When asked why he was holding on to the cash, Mr Singh replied: ''I just wanted to see the outcome of the case.''

Mr Service: ''Is there any reason why you should have held on to that #450?'' ''No,'' said Mr Singh.

Mr Singh said the two victims signed a rental agreement on February 28, just five days before they died. He claimed he first became aware that the third student had been living in the flat just one or two days before the tragedy.

He told the sheriff that when he visited the flat he ''had a feeling there were three of them in it''. The sheriff asked: ''Presumably you would have made arrangements to receive an extra rental payment?''

Mr Singh told him #450 was the rental for the flat and added: ''I wasn't going to charge extra money, so it didn't bother me.''

Asked, because he had a feeling there was an extra occupant, if he had taken steps to register the flat as multiple occupancy he said: ''No. I wasn't 100% sure.''

He could give no explanation why three beds were found in the flat after the fire.

Asked about his earnings, Mr Singh said until the fire he was making #30,000-a-year rent out of the flats at numbers 4 and 6 Melrose Street. He had paid #24,000 for them.

Earlier Mr Singh admitted he had been refused planning permission for the multiple occupancy for the building in l984. He appealed the decision to the Secretary of State for Scotland in l986 and this was refused in l987. He had not applied to be registered for multiple occupancy by the council's new unit because he did not fall into that category, he said.

But he did agree that there were 16 tenants in the building. He admitted that six months ago he received a notice to put fire doors and fire alarms in the properties at 4 Melrose Street but no notice in respect of the basement flat at Number 6, where the boys died. He said that was now unoccupied.

Mr Fraser's mother, Lucy, 39, told the hearing that hours before the tragic blaze her son had phoned her to ask if she would bring smoke alarms to the flat. Mrs Fraser wept as she recalled the phone call. She said she had previously given James two cheques to cover his rent and deposit and had planned to meet him the next day.

The inquiry was adjourned until next month.