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PETITIONER: NEW DELHI MUNICIPAL COMMITTEE

       Vs.

RESPONDENT: KALU RAM & ANR.

DATE OF JUDGMENT20/04/1976

BENCH: GUPTA, A.C. BENCH: GUPTA, A.C. SINGH, JASWANT

CITATION:  1976 AIR 1637            1976 SCR   87  1976 SCC  (3) 407

ACT:      Public Premises  (Eviction of  Unauthorised  Occupants) Act, 1958,  S.  7,  whether  creates  new  right  or  merely provides special procedure, whether subject to limitation.

HEADNOTE:      In 1950,  the appellant  allotted small  pre-fabricated stalls  to   several   displaced   persons   including   the respondent, at  the licence  fee of rupee thirty payable per month. Later,  these allottees  applied for  a  fixation  of standard rent  but ultimately  lost in the Punjab High Court at Delhi,  Meanwhile, the  respondent  fell  in  arrears  in paying the  licence fee.  In December,  1960, the  appellant demanded from him the entire amount in arrears from May 1950 to April  1957 but  he failed to pay. In September 1961, the Estate Officer  ordered the respondent under section 7(1) of the Act,  to pay  the sum, overruling his objection that the claim was  barred by  limitation. The respondent’s appeal to the Additional  District Judge  was rejected, but the Punjab High Court  at Delhi allowed his writ petition on the ground that section  7 could  not be availed in case of time barred claims.      The appellant  contended before  this  Court  that  the Limitation Act only barred the remedy by way of suit and did not extinguish  the right  which could  still  be  exercised through section  7 of  the Act. Section 7 did not put a time limit for  taking action  under it,  and was, therefore, not subject to  the limitation  prescribed for a suit to recover the amount.      Dismissing the appeal, the Court, ^      HELD: Section  7 only  provides a special procedure for the realisation of rent in arrears and does not constitute a source or  foundation of  a right  to claim a debt otherwise time-barred. The  word "payable" in Section 7 in the context in which it occurs, means "legally recoverable". [90 B & D]      Hans Raj Gupta and others v. Official Liquidator of the Dehradun Mussoorie  Electric Tramway  Co. Ltd.  60 I.A.  13, followed.

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JUDGMENT:      CIVIL APPELLATE  JURISDICTION: Civil  Appeal No. 988 of 1968.      (From the  Judgment and order dated the 8-4-1965 of the Punjab High Court, Circuit Bench Delhi-now the High Court of Delhi in Civil Writ No. 228-G of 1962).      Hardyal Hardy,  B.  P.  Maheshwari,  Suresh  Sethi  and Bikaramjit Nayar; for the appellant.      A. K. Sen, D. P. Bhandare, Mrs. Laxmi Arvind Mathur and S. S. Khanduja; for the respondents.      The Judgment of the Court was delivered by      GUPTA, J.-Respondent  Kalu Ram  was pavement  vendor in Connaught place, New Delhi. In 1950 the appellant. New Delhi Municipal Committee,  provided a number of displaced persons with small  pre-fabricated stalls to enable them to do their business. Kalu 88 Ram who  was also  a displaced  person was allotted one such stall on  Irwin Road.  Rupees thirty  was the  licencee  fee payable per  month by  the allottees of these stalls. Later, the allottees, including the respondent, applied to the Rent Controller for  reducing the  rent. It  is not  necessary to refer  to   the  various   proceedings  arising  from  these applications  for  fixation  of  standard  rent  which  were ultimately dismissed by the Circuit Bench of the Punjab High Court at Delhi as not maintainable. In the meantime, many of the allottees fell in arrears in paying the licence fees. So far as  the respondent  is concerned,  the appellant took no steps to  recover  the  dues  till  December  1960  when  it demanded the entire amount in arrears from May 1950 to April 1957. The  respondent not  having paid,  the appellant asked the Estate  Officer, appointed under section 3 of the Public Premises (Eviction  of Unauthorised Occupants) Act, 1958, to take steps  to recover the amount in arrears under section 7 of  that   Act.  The  Estate  Officer,  who  is  the  second respondent herein, made an order on September 28, 1961 under section 7(1) of the Act asking the respondent to pay the sum overruling his  objection  that  the  claim  was  barred  by limitation.  The   respondent’s  appeal  to  the  Additional District  Judge   from  the   Estate  Officer’s   order  was disallowed. The respondent then filed a writ petition before the  Circuit  Bench  of  the  Punjab  High  Court  at  Delhi challenging the  order against  him. One  of the  grounds of challenge was  that section  7 could  not be resorted to for recovery of  the sum  as the claim was time-barred. The High Court accepted  the contention  and allowed the petition. In this  appeal   by  certificate,  the  appellant,  New  Delhi Municipal Committee,  questions the  correctness of the High Court’s decision.      The only  contention raised  before  us  by  Mr.  Hardy appearing for the appellant is that the High Court was wrong in  holding  that  the  amount  in  question  could  not  be recovered under section 7 because the time for instituting a suit to  recover the  sum had  expired. Admittedly, any suit instituted on  the date  when the  Estate Officer  made  his order under section 7(1) would have been barred by time. Mr. Hardy argued  that the Limitation Act only barred the remedy by way of suit and did not extinguish the right, and section 7  of   the  Public   Premises  (Eviction   of  Unauthorised Occupants) Act  providing a  different and  special mode  of recovery was  therefore available to recover rent in arrears beyond three  years. Section  7 as  it stood at the relevant time reads :           Power to  recover rent  or damages  in respect  of      public premises as arrears of land revenue.

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         "7. (1)  Where any  person is  in arrears  of rent      payable in  respect of  any public premises, the estate      officer may,  by order,  require that person to pay the      same within such time and in such instalments as may be      specified in the order.           (2) Where  any person  is, or has at any time been      in unauthorised occupation of any public premises, the 89      estate officer may, having regard to such principles of      assessment of  damages as may be prescribed, assess the      damages on  account of  the use  and occupation of such      premises and  may, by order, require that person to pay      the damages within such time and in such instalments as      may be specified in the order:           Provided that  no such  order shall  be made until      after the  issue of  a notice  in writing to the person      calling upon  him to show cause within such time as may      be specified in the notice why such order should not be      made,  and  until  his  objections,  if  any,  and  any      evidence he  may produce  in support  of the same, have      been considered by the estate officer.           (3) If  any person  refuses or  fails to  pay  the      arrears of  rent or  any  instalments  thereof  payable      under sub-section  (1) or the damages or any instalment      thereof payable  under sub-section  (2) within the time      specified in  the order  relating  thereto  the  estate      officer may  issue a  certificate for the amount due to      the Collector  who shall proceed to recover the same as      an arrear of land revenue."      As would  appear from  the terms  of  the  section,  it provides a  summary procedure for the recovery of arrears of rent. It  was argued that since section 7 did not put a time limit for  taking  steps  under  that  section  and  as  the limitation prescribed  for a  suit to recover the amount did not apply to a proceeding under this section, the High Court was in  error in  upholding the  respondent’s objection.  In support of  his contention  that a  debt remained due though barred by  limitation, Mr.  Hardy  relied  on  a  number  of authorities, both  Indian and English. We do not consider it necessary  to   refer  to   these  decisions   because   the proposition is  not disputed  that the statute of limitation bars the  remedy without  touching the  right. Section 28 of the Indian  Limitation Act,  1908 which  was in force at the relevant  time  however  provided  that  the  right  to  any property was  extinguished  on  the  expiry  of  the  period prescribed by  the Act for instituting a suit for possession of the  property. But  on the facts of this case no question of a  suit for possession of any property arises and section 28 has  no application. It is not questioned that a creditor whose suit  is barred  by limitation,  if he  has any  other legal remedy  permitting him  to enforce his claim, would be free to  avail of it. But the question in every such case is whether the  particular statute  permits such a course. Does section 7  of the  Public Premises (Eviction of Unauthorised Occupants) Act,  1958 create  a right  to realise arrears of rent without  any limitation  of time  ? Under section 7 the Estate Officer  may order  any person  who is  in arrears of rent ’payable’  in respect of any public premises to pay the same within  such time  and in  such instalments  as he  may specify in  the order.  Before however  the order is made, a notice must  issue calling  upon the defaulter to show cause way such  order should  not he  made and,  if he  raised any objection, the Estate Officer must consider the same and the evidence produced  in support of it. Thus the Estate Officer has to determine

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90 upon hearing  the objection  the amount  of rent  in arrears which  is   ’payable.’  The   word  ’payable’   is  somewhat indefinite in  import and  its meaning must he gathered from the context  in which  it occurs.  ’Payable’ generally means that which should be paid. If the person in arrears raises a dispute as  to the amount, the Estate Officer in determining the amount  payable cannot  ignore the existing laws. If the recovery of  any amount  is barred by the law of limitation, it is  difficult to hold that the Estate Officer could still insist that the said amount was payable. When a duty is cast on an  authority to  determine  the  arrears  of  rent,  the determination must be in accordance with law. Section 7 only provides a  special procedure for the realisation of rent in arrears and  does not constitute a source or foundation of a right to  claim a debt otherwise time-barred. Construing the expression "any  money due"  in section  186 of  the  Indian Companies Act, 1913 the Privy Council held in Hans Raj Gupta and others  v. Official Liquidators of the Dehradun Mussorie Electric Tramway  Company Ltd.(1) that this meant moneys due and recoverable in suit by the company, and observed: "it is a section  which creates  a special  procedure for obtaining payment of  moneys; it  is not  a section  which purports to create a  foundation upon which to base a claim for payment. It creates  no new  rights." We  are  clear  that  the  word "payable" in  section 7, in the context in which its occurs, means "legally  recoverable." Admittedly  a suit  to recover the arrears  instituted on the day the order under section 7 was made would have been barred by limitation. The amount in question  was   therefore  irrecoverable.   This  being  the position, the appeal fails and is dismissed with costs. M.R.                                       Appeal dismissed. 91