REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL No. 7171 /2010   

ARISING OUT OF SPECIAL LEAVE PETITION (CIVIL) NO.  34125 OF 2009

Banatwala & Company                            …Appellants

            Versus

L.I.C of India & Anr.                               …Respondents

J U D G E M E N T

H.L. Gokhale J.   

    This  appeal,  by  Special  leave  raises  a  question  as  to  whether  the  

provisions for fixation of standard rent, and provisions prescribing other obligations  

for the landlord such as maintenance of essential services under the concerned Rent  

Control  Act  viz.  Maharashtra  Rent  Control  Act,  1999  as  in  the  present  case  

(hereinafter referred to as the MRC Act), are applicable in respect of public premises  

owned by a corporation such as the first respondent Life Insurance Corporation of  

India (L.I.C in short)  which is otherwise covered by the provisions of  the Public  

Premises (Eviction of Unauthorized Occupants) Act, 1971 (hereinafter referred to as  

the Public Premises Act).

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Short facts leading to this appeal are as follows -

2. The appellant is a firm of Advocates and Solicitors, and is a tenant in  

possession of 5th floor of a seven storey building, situated at 269 D.N. Road, Fort  

Mumbai  owned by the first  Respondent,  L.I.C.   L.I.C.  is  a  statutory  corporation  

constituted  under  the  Life  Insurance  Corporation  Act,  1956.   The  area  under  

occupation of the appellant is 1289.16 sq. feet (equivalent to 113 sq. metres).  The  

petitioner is a tenant of these premises since 1st August, 1988 under an agreement  

of lease which has been extended from time to time.  It is relevant to note that  

there  are  no  proceedings  of  eviction  filed  by  the respondent  No.  1  against  the  

appellant.  The second respondent is the Regional Manager (estates) of L.I.C.

3. The  respondent  No.  2  revised  the  monthly  rent  of  these  premises  

suddenly by his letter of 14th July, 2004 from Rs. 6,891/- to Rs. 39,069/-, including  

Municipal taxes and miscellaneous charges.  The appellant filed a Writ Petition in the  

Bombay High Court being Writ Petition No. 2266 of 2004 to challenge the increasing  

of rent as arbitrary.  The respondents made a statement in the High Court that if the  

petitioner abides by clause IV (e) of the lease agreement between the parties and  

pays  increased  rent  as  provided  therein,  the  respondents  will  not  enforce  the  

increase in the rent that was proposed through letter dated 14.7.2001.  Thereupon  

the writ petition was withdrawn.  Subsequently, the respondents sent a reduced bill  

of Rs. 9144/- per month which included basic rent of Rs. 6181/- plus municipal taxes  

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and water charges of Rs. 355/- and misc. charges of Rs. 100/-.  We place the above  

clause IV (e) on record.  It reads as follows:-

“(e) The Lessor doth hereby convenant with the Lessee that   upon the Lessee paying the rent hereby reserved regularly and   observing  and  performing  all  the  convenants  and  conditions   herein contained, the Lessor shall on Lessee’s request extend the   period  of  the  lease  on  the  same  terms  and  conditions  not   exceeding  five  years  from the  expiration  of  the  terms  hereby   granted subject however that there will be an escalation/increase   in  the  rent  hereby  reserved  by  35%  of  the  rate  mentioned  hereinabove.”

4. It so transpired that the lift of the building (wherein these premises are  

situated) was not working properly, and hence, sometime in 2007, the appellant,  

alongwith  two  other  tenants,  filed  an  application  bearing  R.E.S.  Application  

No.48/Res of 2007 in the Small  Causes Court, Mumbai for restoration of the lift  

services under Section 29 of the MRC Act.   A Single Judge of that Court who heard  

an  Interim  application  therein,  directed  the  respondents  by  his  order  dated  

3.10.2007  to  repair  the  lift.   A  revision  petition  bearing  Revision  Application  

No.308/2007 was filed by the respondents to challenge that order.  The submission  

of the respondents, that the MRC Act was not applicable, was turned down by a  

Division  Bench  of  that  Court,  which  dismissed  that  petition  by  its  order  dated  

11.1.2008.  In the meanwhile, in April, 2007 the respondents further decreased the  

rent from Rs. 9144/- to Rs. 6891/- per month.   

5. The monthly rent for the premises, however continued to be uncertain.  

The respondents increased the rent for the premises once again in March, 2008 to  

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Rs. 8689/-.  In April, 2008 they demanded rent of Rs. 25,063/- on the basis that the  

rateable value of the building had been raised by the Mumbai Municipal Corporation  

from the month of April, 2006 onwards from Rs. 17,895/- to Rs. 1,21,805/-.  The  

appellant was called upon to pay the arrears of rent also from April 2006 amounting  

to Rs. 8,89,503/-.

6. The appellant therefore asked for the break up of the rent bill by their  

letter dated 2.4.2008.  Since no reply was received, appellant filed an Application  

(registered as RAN application No.24/SR/08) under Section 8 (3) of the MRC Act in  

the Court of Small Causes for fixation of standard rent, and also filed an application  

for fixing interim rent.  Respondents in their turn challenged the jurisdiction of the  

Small  Causes  Court  to  entertain  the  proceeding,  and  contended  that  the  suit  

premises were public premises covered under the Public Premises Act, and the MRC  

Act did not apply to them.  They filed an application (exhibit 14) seeking a decision  

on that issue as a preliminary issue.  The Small Causes Court, vide its order dated  

30.3.2009, rejected this application Exhibit 14 and held that the said Standard Rent  

Application was maintainable under the provisions of MRC Act.  Being aggrieved by  

that  order,  the  respondents  filed  a  Writ  Petition  invoking  Article  227  of  the  

Constitution of India in the Bombay High Court bearing Writ Petition No. 5023 of  

2009.

7. A  Learned  Single  Judge  of  the  High  Court  who  heard  the  matter,  

accepted the contention raised by the respondents, and allowed the petition by his  

order dated 8.9.2009.  Thereby, he set-aside the said order dated 30.3.2009 and  

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dismissed the Standard Rent Application.  Being aggrieved by that judgment and  

order, this Appeal by way of special leave has been filed. Mr. Vijay Hansaria, Sr.  

Advocate  appeared  for  the  appellant,  and  Mr.  H.P.  Rawal,  Additional  Solicitor  

General appeared for the respondents.

Rival Submissions in a nutshell -

8. The learned counsel for the appellant submitted that under Section 3  

(1) (a) of the MRC Act, only the premises belonging to the Government or a local  

authority are exempted from the application of the Act.  The MRC Act covers five  

subjects viz. (i) control  of rent, (ii)  repairs of certain premises, (iii) eviction, (iv)  

encouraging  the  construction  of  new  houses  by  assuring  of  fair  return  on  the  

investment to the landlord, and (v) matters connected with the aforesaid purposes.  

It was submitted that on the other hand, the Public Premises Act provided only for  

the  third  subject  out  of  these  five  subjects  viz.  (iii)  eviction  of  unauthorized  

occupants from public premises and for certain incidental matters including recovery  

of arrears of rent from the tenant.  The MRC Act contains a specific chapter namely  

Chapter II regarding the fixation of standard rent and permitted increases.  Section  

29 of the MRC Act lays down the duty of the landlord not to cut off or withhold  

essential supply or service enjoyed by the tenant, and provides for a remedy to the  

tenant in the events of any breach of this duty by the landlord.  As against that,  

there is no provision in that behalf in the Public Premises Act.  Mr. Hansaria, learned  

counsel for the appellant submitted that in as much as there is no provision for  

fixation of standard rent or restoration of essential services in the Public Premises  

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Act, and since the MRC Act is a subsequent Act, the provisions of the MRC Act will  

have to be held as available to the tenants for these purposes.  Mr. Hansaria, did  

not dispute that the premises occupied by the appellant are public premises within  

the definition of the concept of public premises under the Public Premises Act.  He  

did not also dispute that in regard to matters relating to eviction and recovery of  

arrears of rent, the Public Premises Act will  apply to applications by respondents  

against  appellant.    He however,  contended that  for  the purpose  of  fixation  of  

standard rent of the premises of the appellant, the MRC Act will apply.   

9. As against this, the submission of Mr. H.P. Rawal, Additional Solicitor  

General, was that the concept of standard rent was foreign to the Public Premises  

Act, and should not be permitted to be applied to the public premises by permitting  

applications under the MRC Act for that purpose, particularly when the Parliament  

has not made any provision in this behalf in the Public Premises Act.  That apart,  

according to the respondents they were seeking to recover the permitted increases  

on account of increase in the ratable value of the building by the Mumbai Municipal  

Corporation, which was being disputed by the appellant.   With a view to appreciate  

these  rival  submissions,  we  shall  look  into  the  general  principles  governing  the  

relationship between landlord and tenants, and relevant provisions of the MRC Act  

as well as the Public Premises Act.

Relationship of landlord and tenant in general -

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10. A ‘lease’ is defined in Section 105 of Transfer of Property Act, 1882 (in  

short T.P. Act), thus:-  

“105. Lease defined -  A lease of immovable property is a  transfer of a right to enjoy such property, made for a certain  time, express or implied, or in perpetuity, in consideration of   a price paid or promised, or of money, a share of crops,   service  or  any  other  thing  of  value,  to  be  rendered  periodically  or on specified occasions to the transferor  by  the transferee, who accepts the transfer on such terms.

Lessor,  lessee,  premium  and  rent  defined  –  The  transferor is called the lessor, the transferee is called the  lessee,  the  price  is  called  the  premium,  and  the  money,   share, service or other thing to be so rendered is called the   rent.”

A tenancy is created as a result of an agreement between the landlord  

and a tenant.  Since the premises owned by the landlord are leased out to the  

tenant by virtue of the agreement between the parties, the agreement is normally  

called a ‘lease deed’.   To put it in the words of Prof. P.F. Smith “The relationship of  

landlord and tenant arises where one person, who possesses either a freehold or   

leasehold property interest expressly or impliedly grants to another, by means of a   

contract, an estate in that property which is less than the freehold interest or for a   

shorter duration than the leasehold interest of the grantor, as the case may be.”  

(The Law of Landlord and Tenant, Fourth Edition, Page 9). Although, the lease deed  

is  also  a  contract  between  the  parties,  the  provisions  of  T.P.  Act  relating  to  

contracts, shall be taken as part of the Indian Contract Act, 1872 (vide Section 4 of  

T.P. Act).  As a ‘lease deed’ is a contract relating to ‘leases’ governed by T.P. Act,  

the relationship between the landlord and the tenant would be governed by the  

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terms of the lease deed and subject to its terms, by Section 108 relating to the  

rights and liabilities of leasor and leasee, and other statutory provisions controlling  

leases under the T.P. Act.

11. Generally, the terms of the agreement between the landlord and the  

tenant would require the landlord to maintain the premises in tenantable condition,  

and he will get the premises repaired when necessary.  The tenant will be required  

to vacate the premises at the end of the period of lease.  During the lease period, it  

will  be  the  responsibility  of  the tenant  to  pay the rent  regularly  and ‘keep the  

premises in good condition subject only to changes caused by reasonable wear and  

tear or irresistible  force’  and ‘when such defect  has been caused by any act or  

default on the part of the lessee, his servants or agents, he is bound to make it  

good within three months after such notice has been given or left’ (See Section 108  

(m) of T.P. Act.  If the tenant commits breaches of the lease agreement by not  

paying the rent regularly or remaining in arrears thereof, or causing damage to the  

premises, the landlord may terminate the lease earlier, even before the expiry of the  

agreed  term  as  per  the  provisions  concerning  the  termination  provided  in  the  

agreement and the Transfer of Property Act.  If the tenant does not vacate the  

premises  after  the  termination of  lease,  the landlord will  have  to  file  a  suit  for  

evicting him in the Civil Court.

12. On the other hand ‘if the lessor neglects to make, within a reasonable  

time after notice, any repairs which he is bound to make to the property, the lessee  

may make the same himself, and deduct the expense of such repairs with interest  

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from the rent, or otherwise recover it from the lessor’ (see Section 108 (f) of T.P.  

Act).  Section 108 (l) of the T.P. Act lays down that ‘the lessee is bound to pay or  

tender, at the proper time and place, the premium or rent to the lessor or his agent  

in this behalf’.  This implies that the amount of rent that the landlord will require  

shall be a certain definite amount.

The changes brought about by the Rent Control Acts -

13. These general rules governing the relationship of the landlord and the  

tenant have undergone a change after the Second World War.  There is a change in  

the  economic  scenario  world  over,  and  the  intervention  of  the  welfare  state  in  

different  walks  of  life  became  necessary.   “Due  to  scarcity  of  accommodation  

following the second World War, it was found necessary to give special protection to   

tenants against increase of rent and ejectment in supersession of the ordinary law  

of landlord and tenant, embodied in the Transfer of Property Act.”  (The Law of Rent  

Control, by R.B. Andhyarujina, Second Edition, Page 12). The shortage of residential  

houses in urban areas led to the regulation of the relationship between the landlord  

and the tenants by specific acts in that behalf.  The concept of standard rent arrived  

at  after  considering  the  totality  of  the  factors,  came to  control  the  rent  to  be  

charged by the landlord.  The landlord would not be entitled to charge in excess of  

the standard rent, although the additions therein on account of Municipal Taxes etc.  

became permissible.  The Bombay Rents, Hotel and Lodging House Rates (Control)  

Act,  1947,  (Bombay  Rent  Act  for  short)  is  one  such  legislation  which  is  an  

advancement over the Transfer of Property Act.  This Act laid down that a tenant  

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will not be evicted unless the landlord establishes that the tenant has committed  

breaches as laid down under that Act, and the burden will be on the landlord to  

establish  that  the tenant  has committed the particular  breach,  such as being in  

arrears of standard rent over a specified period, erecting permanent structures on  

the premises without landlord’s  permission,  sub-letting the premises and causing  

nuisance to the neighbours  etc.   A reasonable and bonafide requirement of  the  

landlord was also provided as a ground for eviction.  If the landlord was charging  

rent excessively, a right was given to the tenant to have the standard rent fixed  

under Section 11 of that act.   A further right was given to the tenant to approach  

the Court under Section 24 of that act for maintenance and restoration of essential  

services in case the landlord neglected the same.   

14. The first respondent L.I.C owns a large number of properties in the city  

of Mumbai and elsewhere.  Earlier, the relationship between L.I.C as the landlord  

and its tenants was governed under the Bombay Rent Act 1947.  The question is as  

to what change has been brought about by the Public Premises Act 1971, into this  

relationship?   The  Public  Premises  Act  1971,  provides  only  for  eviction  of  

unauthorized occupants, and recovery of arrears of rent from the tenant.  Can it  

therefore be said that the other provisions of the Bombay Rent Act, ceased to apply  

to the tenancies which were earlier covered thereunder? Or would it be proper to  

say that only the aspect of the eviction and recovery of arrears of rent came to be  

covered under the Public  Premises Act?  Can it  be said that because the Public  

Premises Act came to be applied in 1999, L.I.C could suddenly charge any rent as it  

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deemed fit in excess of the standard rent?  Can it be said that the remedy for the  

tenant for fixation of standard rent, and getting the essential services restored when  

necessary by moving the Court was no longer available merely because the Public  

Premises Act came to be applied?  Does the Public Premises Act have an overriding  

effect denying these remedies to the tenants for all purposes?

15. The Bombay Rent Act came to be replaced by the MRC Act 1999.  The  

MRC Act is subsequent to the Public Premises Act, 1971, and has come into force  

with  effect  from 31.3.2000 after  receiving  the assent  of  the President  of  India.  

Therefore, the subjects which were covered under the Bombay Rent Act came to be  

covered under the MRC Act, 1999 as appropriately modified including the concept of  

standard rent.  Can it therefore not be said that as far as premises of L.I.C. are  

concerned, on all other subjects excluding the subject of eviction of unauthorized  

occupants and recovery of arrears of rent, the modified provisions under the MRC  

Act will apply wherever the Bombay Rent Act was applicable?

16. As far as the petitioner is concerned, it occupied the suit premises in  

the year 1988 under an agreement of lease with L.I.C, at which time the Public  

Premises Act as well as Bombay Rent Act were in force.  This agreement has been  

extended from time to time.  As stated above, the Bombay Rent Act was replaced  

with effect from 31.3.2000 by the MRC Act.  Would it therefore not be correct to say  

that for aspects other than eviction, and recovery of arrears of rent, the relationship  

between the  petitioner  and the  respondent  (which  was earlier  governed by  the  

Bombay Rent Act) will now be governed under the MRC Act?

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The Maharashtra Rent Control Act, 1999 -

17. The  MRC  Act  consists  of  sixty  sections  which  are  divided  in  nine  

separate chapters,  Chapter (I) is on preliminary provisions, Chapter (II) contains  

the provisions regarding fixation of standard rent and permitted increase, Chapter  

(III) contains the provisions concerning relief against forfeiture, Chapter (IV) is for  

recovery  of  possession,  or  eviction  of  the  tenant  by  the  Landlord,  Chapter  (V)  

contains the special provisions for recovery of possession in certain cases such as  

where the premises are owned by members of Armed Forces, Scientists etc, Chapter  

(VI) contains the provisions regarding sub-tenancies and other matters concerning  

tenancies,  Chapter  (VII)  contains  provisions  regarding jurisdiction  of  the  Courts,  

suits,  appeals, practice and procedure, Chapter (VIII) contains provisions for the  

summary  disposal  of  certain  applications  and  Chapter  (IX)  contains  the  

miscellaneous provisions.

18. As stated earlier,  the preamble  of  MRC Act states that  it  is  an Act  

relating to five subjects, namely (i) control of rent, (ii) repairs of certain premises,  

(iii) eviction, (iv) encouraging the construction of new houses by assuring fair return  

of  investment  by  the  landlord,  and  (v)  matters  connected  with  the  purposes  

mentioned   above.  Section 2 of the act gives the applicability of the act.  Sub-

section (1) thereof lays down that in the first instance, the act applies to premises  

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let for the purposes of residence, education, business, trade or storage, and in the  

areas specified in Schedule I and Schedule II of the Act.   Schedule I and II mention  

the cities and towns to which this Act applies.  

19.  Section  3  of  MRC Act  provides  for  the  exemptions  from this  Act.  

Whereas sub-section 1 (a) thereof excludes from the application of this Act,  the  

premises  belonging  to  the  Government  or  a  local  authority,  Sub-Section  1  (b)  

declines to give protection of the provisions of this Act to certain tenants where the  

tenants are banks, public sector undertakings, multi-national companies, private and  

public  limited  companies  with  a  share  capital  of  more  than  Rs.  1  crore,  etc.  

Section  4  gives  the  power  of  the  State  Government  to  prescribe  conditions  for  

exemption in respect of premises belonging to local authority.  We quote these two  

sections in their entirety.

“3. Exemption

(1) This Act shall not apply------

(a) to  any  premises  belonging  to  the  Government  or  a  local   authority or apply as against the Government to any tenancy,   licence or other like relationship created by a grant from or a   licence  given  by  the  Government  in  respect  of  premises  requisitioned  or  taken  on  lease  or  on  licence  by  the  Government, including  any premises taken on behalf of the  Government on the basis of tenancy or of licence or other   like relationship by, or in the name of any officer subordinate   to the Government authorized in this behalf, but it shall apply   in  respect  of  premises  let,  or  given  on  licence,  to  the  Government or a local authority or taken on behalf of the   Government  on  such  basis  by,  or  in  the  name  of,  such  officer.

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(b) To any premises  let or sub-let to banks, or any Public Sector   Undertakings  or  any Corporation  established  by or  under   any Central  or State Act, or foreign missions, international   agencies,  multinational   companies,  and  private  limited  companies  and public limited companies having a paid up  share capital  of more than rupee one core or more.

Explanation. For the purpose of this clause the expression “bank”   means,-

(i) the State Bank of India constituted under the State Bank   of India Act, 1955;

(ii) a subsidiary bank as defined in the State Bank of India   (Subsidiary Banks) Act, 1959;

(iii) a corresponding new bank constituted under section 3 of   the  Banking  Companies  (Acquisition  and  Transfer  of   Undertaking) Act, 1970 or under section 3 of the Banking  Companies (Acquisition and Transfer of Undertaking) Act,   1980, or

(iv) any  other  bank,  being  a  scheduled  bank  as  defined  in   clause (e) of section 2 of the Reserve  Bank of India Act,   1934.

(2) The  State  Government  may  direct  that  all  or  any  of  the  provisions  of  this  Act  shall,  subject  to  such conditions  and  terms as it may specify, not apply-

(i) to premises used for public purposes of a charitable nature  or to any class of premises used for such purposes;

(ii) to  premises  held  by  a  public  trust  for  a  religious  or   charitable purpose and let  at  a nominal  or concessional   rent;

(iii) to  premises  held  by  a  public  trust  for  a  religious  or   charitable purpose and administered by a local authority;   or

(iv) to  premises  belonging  to  or  vested  in  an  university   established by any law for the time being in force

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Provided that, before issuing any direction under this sub-section,   the State Government shall ensure that the tenancy rights of the   existing tenants are not adversely affected.

(3) The expression “premises belonging to the Government or a  local  authority’  in  sub-section  (1)  shall,  notwithstanding  anything  contained  in  the  said  sub-section  or  in  any  judgment, decree or order of a court, nor include a building   erected on any land held by any person from the Government   or  a  local  authority  under  an  agreement,  lease,  licence or  other grant, although having regard to the provisions of such   agreement, lease, licence or grant of building so erected may  belong or continue to belong to the Government or the local   authority,  as  the  case  may  be,  and  such  person  shall  be   entitled to create a tenancy in respect of such building or a  part thereof.

4. Power of State Government to issue orders In respect of  premises belonging to local authority, etc.

Notwithstanding anything contained in this Act, the State Government  may,  from time to time,  by general  or  special  order,  direct  that  the  exemption granted to a local authority under sub-section (1) of section  3 shall be subject to such conditions and terms as it may specify either   generally or specially in any particular case, as the State Government  may in its direction determine.

20. Section 7 (6) of MRC Act defines the local  authority which includes  

certain  Municipal  Corporations  such  as  Mumbai  Municipal  Corporation,  Nagpur  

Municipal  Corporation,  Municipal  Councils  constituted  under  the  Maharashtra  

Municipal  Council,  Nagar  Panchayats  and  Industrial  Townships  Act,  1965,  Zila  

Parishads  and  Panchayat  Samitis,  Village  Panchayats,  Maharashtra  Housing  and  

Area Development Authority,  City and Industrial Development Corporation etc.

21. Section  2  (14)  defines  the  standard  rent.   Section  6  states  that  

provision  with  regard  to  standard  rent  will  not  apply  to  certain  premises  which  

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include,  (a)  buildings  reconstructed  after  demolishing  the  old  building  in  the  

circumstances mentioned in Sections 20 & 21 of the Act, and (b) the premises which  

are  constructed  or  reconstructed  in  any  housing  scheme,  undertaken  by  

Government of the Maharashtra Housing and Area Development Authority or by any  

of its Boards established under Section 18 of the Maharashtra Housing and Area  

Development Act, 1976.  Section 8 lays down that the Court may fix the standard  

rent and permitted increases, and Section 10 states that claiming rent in excess of  

standard rent is illegal.  Section 11 permits the increase in rent only on account of  

improvements and special additions, or for heavy repairs.  Section 12 permits the  

increase in rent on account of payment of rates to the public bodies.  Section 14  

lays down the duty of the landlord to keep the premises in good repairs.  Section 29  

lays  down  that  the  landlord  shall  not  cut  off  or  withhold  essential  supplies  or  

services and provides for the remedy to the tenant against the same.   Section 33 of  

the Act gives the jurisdiction of Courts in that behalf.   In Mumbai, the jurisdiction is  

with the Court of Small Causes.   

22. Sections 2(14), 8 and 29 are relevant for our purpose.  They read as  

follows:-

“2  (14)  “standard  rent”,  in  relation  to  any  premises   means.-

(a) where the standard rent is fixed by the Court or, as the case   may  be,  the  Controller  under  the  Bombay  Rent  Restriction  Act   1939, or the Bombay Rents, Hotel Rates and Lodging House Rates   (Control) Act, 1944 or the Bombay Rents, Hotel and Lodging House  Rates  Control  Act  ,  1947,  or  the  Central  Provinces  and  Berar   Letting of Houses and Retnt Control Order, 1949 issued under the   

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Central  Provinces  and  Berar  Regulation  of  Letting  of   Accommodation  Act,  1946,  or  the  Hyderabad  Houses  (Rent,   Eviction and Lease) Control Act, 1954, such rent plus an increase  of 5 per cent, in the rent so fixed ; or

(b)   where  the standard  rent  or  fair  rent  is  not  so  fixed,  then  subject to the provisions of sections 6 and 8. –

(i)  the rent at which the premises were let on the Ist   day of October 1987; or

(ii)  where the premises were not let on the Ist day of   October 1987, or the rent at which they were last let   before that day, plus an increase of 5 per cent, in the  rent of the premises let before the Ist day of October,   1987, or

(c)  in any of the cases specified in section 8, the rent fixed by the  court;  

“8. Court may fix standard rent and permitted increases in certain   cases

(1) Subject  to  the  provisions  of  section  9  in  any  of  the   following cases, the court may, upon an application made  to it for the purpose, or in any suit or proceedings, fix the  standard  rent  at  such amount  as,  having regard to  the  provisions of this Act and the circumstances of the case,   the court deems just,-  

(a) where  the  court  is  satisfied  that  there  is  no   sufficient  evidence  to  ascertain  the  rent  at  which  the  premises were let in any one of the cases mentioned in   paragraphs (i) and (ii) of sub-clause (14) of section 7; or

(b) whereby reasons of the premises having been let at   one time as a whole or in parts and at another time, in   parts or as a whole, or for any other reasons; or

(c) where any premises have been or are let rent-free or,   at a nominal rent; or for some consideration in addition to  rent; or

(d) where there is any dispute between the landlord and  the tenant regarding the amount of standard rent.

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(2) If there is any dispute between the landlord and the tenant   regarding the amount of permitted increase, the court may  determine such amount.

(3) If  any  application  for  fixing  the  standard  rent  or  for   determining the permitted increase is made by a tenant,-

(a) the court shall forthwith specify the amount of rent,   or permitted increase which are to be deposited in court by  the  tenant,  and  make  an  order  directing  the  tenant  to  deposit such amount in court or, at the option of the tenant,   make an order to pay to the landlord such amount thereof   as the court may specify pending the final decision of the   application.  A copy of the order shall be served upon the   landlord;

(b) out  of  any  amount  deposited  in  the  court  under  clause (a),  the court may make an order for  payment of   such reasonable sum to the landlord towards payment of   the rent or increases due to him as it thinks fit;

(c) if the tenant fails to deposit such amount or, as the   case may be, to pay such amount thereof to the landlord,   his application shall be dismissed.

(4) (a) Where  at  any stage of  a suit  for  recovery of  rent,   whether with or without a claim for possession, of the premises,   the court is satisfied that the rent is excessive and standard rent   should be fixed, the court may, and in any other case, if it appears   to the court that it is just and proper to make such an order, the   court may make an order directing the tenant to deposit in court   forthwith such amount of  the rent as the court considers  to be   reasonable due to the landlord, or at the option of the tenant, an   order directing him to pay to the landlord such amount thereof as  the court may specify.

(b) The court may further make an order directing the   tenant to deposit in court periodically such amount as it considers   proper as interim standard rent, or at the option of the tenant, an   order to pay to the landlord, such amount thereof as the court may  specify, during the pendency of the suit;

(c) The court may also direct that if the tenant fails to   comply with any order made as aforesaid, within such time as may  be allowed by it, he shall not be entitled to appear in or defend the  

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suit except with leave of the court, which leave may be granted  subject to such terms and conditions as the court may specify.

(5) No appeal shall lie from any order of the court under sub- sections (3) and (4).

(6) An application under this section may be made jointly by all   or any of the tenants interested in respect of the premises situated   in the same building.  

29. Landlord not to cut-off or withhold essential supply   or service

(1) No landlord, either himself or through any person acting or  purporting  to  act  on  his  behalf,  shall,  without  just  or  sufficient   cause, cut-off or withhold any essential supply or service enjoyed  by the tenant in respect of the premises let to him.

(2) A tenant in occupation of the premises may, if the landlord   has  contravened  the  provisions  of  sub-section  (1),  make  an  application to the court for a direction to restore such supply or   service.

(3) Having regard to the circumstances of a particular case the   court, may, if it is satisfied that it is necessary to make an interim   order,  make  such  order  directing  the  landlord  to  restore  the  essential supply or service before the date specified in such order,   before giving notice to the landlord of the enquiry to be made in   the application under sub-section (3) or during the pendency of   such enquiry.  On the failure of the landlord to comply with such  interim order of the court, the landlord shall be liable to the same   penalty as is provided for in sub-section (4).

(4) If  the court  on inquiry finds that  the tenant has been in   enjoyment of the essential supply or service and that it was cut-off   or withheld by the landlord without just  or sufficient  cause,  the  court shall make an order directing the landlord, to restore such   supply or service before a date to be specified in the order.  Any   landlord who fails, to restore the supply or service before the date  so specified, shall, for each day during which the default continues  thereafter,  be liable upon further directions by the court to that  effect, to fine which may extend to one hundred rupees.

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(5) Any landlord, who contravenes, the provisions of sub-section  (1),  shall,  on conviction,  be punishable  with imprisonment for a   term which may extend to three months or with fine which may   extend to one thousand rupees or with both.

(6) An application under this section may be made jointly by all   or  any  of  the  tenants  of  the  premises  situation  in  the  same  building.

Explanation – In this section, -

(a) essential supply or service includes supply of water,   electricity,  lights  in  passages  and  on  stair-cases,  lifts  and  conservancy or sanitary service;

(b) withholding  any  essential  supply  or  service  shall   include acts or omissions attributable to the landlord on account of   which the essential supply or services is cut-off by the municipal   authority or any other competent authority.

(7) Without prejudice to the provisions of sub-sections (1) to (6)   or any other law for the time being in force, where the tenant, -

(a) who has been in enjoyment of any essential supply or  service and the landlord has withheld the same, or

(b) who  desires  to  have,  at  his  own  cost,  any  other  essential supply or service for the premises in his occupation,

the  tenant  may  apply  to  the  Municipal  or  any  other  authority   authorized in this behalf, for the permission or for supply of the   essential service and it shall be lawful for that authority to grant  permission for, supply of such essential supply or service applied   for without insisting on production of a “No Objection Certificate”   from the landlord by such tenant.”

The Public Premises Act (Eviction of Unauthorised Occupants) Act, 1971-

23. Now, when we turn to the Public Premises Act, the preamble of the Act  

states that it is an Act to provide for the eviction of unauthorized  occupants  from  

public premises and for certain incidental matters. It was enacted to deal with the  

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problem of  rampant  unauthorised  occupation  of  public  premises  by  providing  a  

speedy machinery for the recovery of these premises and the arrears of rent from  

the occupants thereof. Section 2 (e) of this Act defines the public premises, Section  

2 (f) defines rent, and Section 2 (g) defines unauthorized occupation. Section 2 (g)  

is in two parts.  The first part of the said section states, that it means the occupation  

by any person of the public premises without any authority for such occupation.  

The second part is inclusive in nature, and it expressly covers the continuation in  

occupation by any person of the public premises after his authority to occupy the  

same  has  expired  or  has  been  determined  for  any  reason  whatsoever.   These  

sections read as follows:-

2(e) “public premises” means-

(1) any  premises  belonging  to,  or  taken  on  lease  or   requisitioned by, or on behalf of the Central Government,   and includes any such premises which have been placed  by  that  Government,  whether  before  or  after  the  commencement  of  the  Public  Premises  (Eviction  of  Unauthorised  Occupants)  Amendment  Act,  1980  (61  of   1980), under the control of the Secretariat of either House  of Parliament for providing residential  accommodation to   any member of the staff of that Secretariat;

(2) any premises belonging to, or taken on lease by, or on   behalf of,-

(i) any  company  as  defined  in  section  3  of  the  Companies Act, 1956 (1 of 1956), in which not less  than fifty-one per cent of the paid up share capital   is held by the Central Government or any company  which is a subsidiary (within the meaning of that   Act) of the first-mentioned company;

(ii) any corporation (not being a company as defined in  section 3 of the Companies Act, 1956 (1 of 1956) or   

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a local authority) established by or under a Central   Act  and  owned  or  controlled  by  the  Central   Government;

(iii) any University  established or  incorporated by any  Central Act.

(iv) any  Institute  incorporated  by  the  Institutes  of   Technology Act, 1961 (59 of 1961);

(v) any Board of  Trustees  constituted under  the Major   Port Trusts Act, 1963 (38 of 1963);

(vi) the  Bhakra  Management  Board  constituted  under  section  79  of  the  Punjab  Reorganisation  Act,  1966  (31 of 1966), and that Board as and when re-named  as the Bhakra-Beas Management  Board under  sub- section (6 of section 80 of that Act;

(vii) any  State  Government  or  the  Government  of  any  Union  Territory  situated  in  the  National  Capital   Territory of Delhi or in any other Union Territory;

(viii) any  Cantonment  Board  constituted  under  the  Cantonments Act, 1924 (2 of 1924); and

(3) in relation to the [National Capital Territory of Delhi]-

(i) any premises belonging to the Municipal Corporation  of Delhi, or any Municipal Committee or notified area  committee;

(ii) any  premises  belonging  to  the  Delhi  Development   Authority,  whether  such  premises  are  in  the  possession of, or leased out by, the said Authority;   and

(iii) any  premises  belonging  to,  or  taken  on  lease  or  requisitioned  by,  or  on  behalf  of  any  State  Government  or  the  Government  of  any  Union  Territory;]

2(f) “rent”,  in  relation  to  any  public  premises,  means  the  consideration  payable  periodically  for  the  authorized  occupation of the premises, and includes,-

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(i) any charge for electricity, water or any other services  in connection with the occupation of the premises,

(ii) any tax (by whatever name called) payable in respect   of the premises,

where  such  charge  or  tax  is  payable  by  the  Central   Government or the corporate authority,

2(g) “unauthorized  occupation”,  in  relation  to  any  public   premises, means the occupation by any person of the public  premises without authority for such occupation, and includes  the continuance in occupation by any person of the public   premises after the authority (whether by way of grant or  any other mode of transfer) under which he was allowed to   occupy the premises has expired or has been determined for  any reason whatsoever.”

24. Section 3 of the Public Premises Act provides for the appointment of  

estate officers who have the authority to hold inquiries under this Act, Section 4  

provides for issuance of show cause notice, which proposes an order of eviction.  

Section 5 provides for the inquiry in pursuance to the show cause notice, and the  

order of eviction to be passed thereafter.   Section 7 deals with the power of the  

estate officer to pass orders concerning arrears of rent and damages in respect of  

unauthorized occupation, Section 9 provides for appeals against the order of the  

estate officers to the Appellate officer who shall be the District Judge of the District.  

Section 14 provides for the recovery of rent as arrears of land revenue, and Section  

15 for the bar of jurisdiction of courts to entertain any suit or proceeding in respect  

of the matters mentioned in the Section.  Thus, it is an act for speedy recovery of  

public  premises  and  arrears  of  rent  from  the  unauthorized  occupants,  and  it  

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provides a separate mechanism for the same.  Section 5, 7 and 15 of this Act are  

relevant for our purpose.  These sections read as follows:-

Section 5 - Eviction of unauthorised occupants

(1) If, after considering the cause, if any, shown by any person in   pursuance of a notice under section 4 and any evidence produced by  him in support of the same and after personal hearing, if any, given   under clause (b) of sub-section (2) of section 4], the estate officer is   satisfied that the public premises are in unauthorised occupation, the  estate  officer  may  make  an  order  of  eviction,  for  reasons  to  be  recorded therein, directing that the public premises shall be vacated,   on such date as may be specified in the order, by all persons who may  be in occupation thereof or any part thereof, and cause a copy of the   order to be affixed on the outer door or some other conspicuous part   of the public premises.

(2) If  any person refused or fails to comply with the order of   eviction [on or before, the date specified in the said order or within  fifteen days of its publication under sub-section(1) whichever is later,]   the estate officer or any other officer duly authorized by the estate   officer in this behalf may evict that person from, and take possession  of, the public premises and may, for that purpose, use such force as   may be necessary.

Section 7 - Power to require payment of rent or damages in  respect of public premises  

(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 installments as may be   specified in the order.

(2)  Where  any  person  is,  or  has  at  anytime  been,  in  unauthorised   occupation of any public premises, the 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.

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1 [(2A) While making an order under sub-section (1) or sub-section (2),   the estate officer may direct that the arrears of rent or, as the case may  be, damages shall be payable together with simple interest at such rate   as may be prescribed, not being a rate exceeding the current rate of   interest within the meaning of the interest Act, 1978.]

(3) No order under sub-section (1) or sub-section (2) shall  be made  against  any person 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.  

Section 15 - Bar of jurisdiction   

No Court shall have jurisdiction to entertain any suit or proceeding in  respect of--

(a) the eviction of any person who is in unauthorised occupation of   any public premises, or

(b) the removal of any building, structure or fixture or goods, cattle   or other animal from any public premises under Section 5A, or

(c)  the  demolition  of  any  building  or  other  structure  made,  or  ordered to be made, under Section 5B, or

[(cc) the sealing of any erection or work or of any public premises   under Section 5C, or]

(d) the arrears of rent payable under sub-section (1) of section 7 or   damages payable under  subsection (2),  or  interest payable under  sub-section (2A); of that section, or

(e) the recovery of--

(i) costs of removal of any building, structure or fixture or goods,   cattle or other animal under Section 5A, or

(ii)  expenses  of  demolition  under  Section  5B,  or  (iii)  costs   awarded to the Central Government or statutory authority under   sub-section (5)  of  section 9,  or  (iv)  any portion of  such rent,   damages,  costs  of  removal,  expenses  of  demolition  or  costs   awarded to the Central Government or the statutory authority.]

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Order passed by the Small Causes Court:-

25. Reverting to the order passed by the Small Causes Court, it is seen  

that it dismissed the application exhibit 14 filed by the respondent principally for the  

following reasons:-

(i) The  public  premises  are  not  specifically  exempted  from  the  

applicability of the MRC Act;

(ii) Since an application for fixation of standard rent is not a proceeding  

for eviction of a tenant, Small Causes Court can entertain it;

(iii) The respondent, LIC has framed guidelines for charging rent.  These  

guidelines  have a  statutory  force under  Section 21 of  the  LIC Act.  

They require LIC to charge reasonable rent, and therefore the Bombay  

High Court  has  in Writ  Petition No.2436 of  2003 (Persis  Kothawala  

Versus LIC) held that these guidelines are binding on LIC.  On that  

basis, the standard rent application would be maintainable.

(iv) Section  3  of  the  MRC  Act  does  not  exempt  LIC  and  hence  the  

provisions of MRC Act are applicable to its premises.

(v) Merely because the premises were covered under the Public Premises  

Act, the jurisdiction to entertain the Standard Rent Application under  

the MRC Act was not ousted.  There was no conflict between the two  

Acts for that purpose.

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The impugned judgment of the High Court and its reliance on the  

constitution bench judgment in Ashoka Marketing Ltd. -

26. The learned Single Judge who decided the petition principally relied  

upon the judgment of a constitution bench of this Court in Ashoka Marketing Ltd.  

and Another Versus Punjab National Bank and Others [1990 (4) SCC 406],  

in  support  of  his  view. This  judgment decided four  Civil  Appeals  concerning the  

properties of four respondents situated in Delhi.  Two of them were concerning the  

properties of Punjab National Bank, one of Union of India and one of LIC.  In all  

these matters the respondents had initiated actions for eviction under the Public  

Premises Act.  The question in those appeals was whether the occupants could be  

evicted under the Public Premises Act, or whether they could invoke the protection  

of Delhi Rent Control Act, 1958.  This Court held that the proceedings under the  

Public Premises Act were valid and legal.  Relying on this judgment the High Court  

held that in the present case the Public Premises Act will govern the field, and the  

Standard Rent Application was not maintainable.  The learned Judge has observed  

in para 17 of the impugned judgment as follows:-

“There may not be a provision in the said Act of 1971 for fixing   standard rent but there are provisions in the said Act of 1971  which empower the authorities to pass an order for recovery of   rent and/or compensation from the tenant”.  

This is a reference to the power of the estate officer under section 7 of the Public  

Premises Act for recovery of  rent.   Section 7(2)  empowers the estate  officer  to  

assess the damages on account of use and occupation of the public premises by an  

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unauthorized  occupant.   This  assessment  is  to  be  made  having  regard  to  the  

principles that may be prescribed under the rules.  This power is entirely different  

from the authority to fix the standard rent, which is no where provided in the Public  

Premises Act.  Thus, this is not an answer to the issue raised before the learned  

Judge, viz.  as to whether a standard rent application under the concerned Rent  

Control Act was maintainable, when there is no specific provision for the same under  

the Public Premises Act.   

27. Besides, section 7 of the Act is a procedural provision as held by this  

Court in  New Delhi Municipal Committee Vs. Kalu Ram & Anr. reported in  

[AIR 1976 SC 1637] equivalent to  [1976 (3) SCC 407].  In that matter the  

Municipality had contended that section 7 permitted it  to recover arrears of rent  

which were even time barred.  This Court rejected the contention and held that it  

was only a section for providing a special procedure for realization of arrears of rent,  

and which was a summary procedure.  It did not constitute a source or foundation  

of a right to claim a debt which was otherwise time barred.  The Learned Judge has,  

however, tried to get over this position by relying upon Section 15 of the Public  

Premises Act as follows:-  

“Apart from that, in view of the overriding effect of the said Act   of  1971,  an  occupant  of  the  public  premises  cannot  claim  protection  under  the  Rent  Control  Legislation  in  as  much  as  section 15 of the said Act of 1971 ousts the jurisdiction of the   Courts under the Rent Control Legislation to deal with the matter   of recovery of rent in respect of public premises.”

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Again, it is difficult to say that this approach is a correct one.  That is because  

the High Court was not concerned with the recovery of arrears of rent by a public  

authority, an action against which would get ousted in view the provision of section  

15 of the Public Premises Act, as also one against eviction.  The question is whether  

a  tenant’s  application  for  fixation  of  Standard  Rent  would  get  ousted.  The  

respondents  are claiming that  what they are charging are permissible  increases,  

whereas the appellant contends that what is charged is in excess of what should be  

the Standard Rent, and for that purpose it has filed an application for fixation of  

Standard Rent under the MRC Act.  Would it, not be maintainable under that act?

28. In  Ashoka  Marketing,  this  Court  noted  that  the  rent  control  

legislation would fall within the ambit of entries 6, 7 and 13 of List III (Concurrent  

List).  The Public Premises Act would otherwise fall under entry 32 of List I being a  

law with respect to the property of Union of India.  However, in relation to the  

properties belonging to the various legal entities, mentioned in clauses (2) and (3)  

of Section 2 (e), the Public Premises Act would be covered under entries 6, 7 and 46  

of List III.  The Court, therefore, noted that both the statutes were enacted by the  

same legislature i.e. Parliament,  in exercise of  its legislative power in respect of  

matters enumerated in the concurrent list.  It was, therefore, of the opinion that the  

question as to whether the Public Premises Act will override the Rent Control Act will  

have  to  be  considered  in  the  light  of  the  principles  of  statutory  interpretation  

applicable  to  the  laws  made  by  the  same  legislature.   Having  said  that,  the  

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constitution bench noted the relevant principles in this behalf in paragraph 50 as  

follows:-

“50. One such  principle  of  statutory  interpretation  which  is   applied is contained in the latin maxim : leges posteriors priores   conterarias abrogant (later laws abrogate earlier contrary laws).  This  principle  is  subject  to  the  exception  embodied  in  the  maxim : generalia specialibus non derogant (a general provision   does not derogate from a special one.)  This means that where   the literal meaning of the general enactment covers a situation  for  which  specific  provision  is  made  by  another  enactment   contained in the earlier Act, it is presumed that the situation   was  intended  to  continue  to  be  dealt  with  by  the  specific   provision rather than the alter general one (Bennion, Statutory   Interpretation pp. 433-34).”

The Court, therefore, examined the schemes of the two enactments, and noted the  

features of the two enactments in para 55 as follows:-

“55.(i) The Rent Control Act makes a departure from the general law  regulating  the  relationship  of  landlord  and  tenant  contained  in  the  Transfer  of  Property  Act  inasmuch  as  it  makes  provision  for   determination of standard rent, it specifies the grounds on which a   landlord can seek the eviction of a tenant, it prescribes the forum for  adjudication  of  disputes  between  landlords  and  tenants  and  the  procedure which has to be followed in such proceedings.  The Rent   Control Act can, therefore, be said to be a special statute regulating  the relationship of landlord and tenant in the Union Territory of Delhi.   (ii) The Public Premises Act makes provision for a speedy machinery to  secure eviction of unauthorised occupants from public premises.  As  opposed to the general law which provides for filing of a regular suit   for recovery of possession of property in a competent court and for   trial of such a suit in accordance with the procedure laid down in the   Code of Civil Procedure, the Public Premises Act confers the power to   pass  an  order  of  eviction  of  an  unauthorized  occupant  in  a  public   premises on a designated officer and prescribes the procedure to be  followed  by  the  said  officer  before  passing  such  an  order.   (iii)   Therefore,  the  Public  Premises  Act  is  also  a  special  statute  relating to eviction of unauthorized occupants from public premises.   In other words, both the enactments, namely, the Rent Control Act   and the Public  Premises Act,  are special  statutes  in relation to  the  

30

matters dealt with therein.”         ……(nos.  to  sub- paragraphs supplied)

Having  noted  the  distinctive  features  of  the  two  acts,  the  Court  held  that  the  

principle that a subsequent general law cannot derogate from an earlier special law  

could not be invoked in that case because the later act, namely, Public Premises Act  

was also special statute and not a general enactment.  Therefore, it further held  

that the Public Premises Act must prevail over the Rent Control Act in accordance  

with the principle that the later laws abrogate earlier contrary laws.

29. In view of the fact that both the enactments had non-obstante clauses,  

a reference was made to an earlier judgment of a bench of three judges on such a  

situation in the case of  Shri Sarwan Singh and another Versus Shri Kasturi  

Lal reported in 1977 (1) SCC 750.  In that mater the question before the Court  

was whether provisions of Slum Areas (Improvement and Clearance) Act, 1956 will  

override those of the Delhi Rent Control Act, 1958.  If so, no person can initiate any  

suit or proceeding for eviction of a tenant from any building or land in slum area  

without the permission in writing of the competent authority under the Slum Act.  

The respondent in that matter was a government employee and was staying in a  

quarter allotted to him, and he was asked to vacate this quarter on the ground that  

he owned another residential house.  The house constructed by him was occupied  

by the appellant and it was in an area covered under the Slum Act.  On being asked  

to vacate the quarter, the respondent gave a notice to the appellant to vacate his  

premises, and followed it up by filing an application under the Rent Control Act.  The  

31

appellant pleaded that he cannot be asked to vacate unless permission from the  

authority  under  the  Slum  Clearance  Act  was  obtained.   This  Court  noted  that  

although Section 19 (1) of  the Slum Clearance Act required a permission of the  

competent  authority  before  instituting  proceeding  for  eviction  of  a  tenant,  

notwithstanding that provision, by an amendment Section 14-A and Chapter III-A  

were brought into Delhi Rent Control Act.  The Court examined the schemes of the  

two acts and then held that the provision of the Delhi Rent Control Act had to be  

given precedence, as in the present case although the government servant is asked  

to vacate his quarter, he will not be able to proceed against his tenant unless he  

obtains the permission from the Slum Clearance Authority.  It is to obviate such  

difficulty that the amendment in the Delhi Rent Control Act had been brought in.  In  

that context it was observed in para 20 as follows:-

“20. ……..When two or more laws operate in the same field and each   contains a non-obstante clause stating that its provisions will override  those  of  any  other  law,  stimulating  and  incisive  problems  of  interpretation  arise.   Since  statutory  interpretation  has  no  conventional protocol, cases of such conflict have to be decided  in  reference  to  the  object  and  purpose  of  the  laws  under  consideration……”

(emphasis supplied)

Therefore, the Court concluded in para 23 as follows:-

”23. ……Bearing in mind the language of the two laws, their object   and purpose, and the fact that one of them is later in point of time   and was enacted with the knowledge of the non-obstante clauses in  the earlier law, we have come to the conclusion that the provisions of   Section 14A and Chapter IIIA of the Rent Control Act must prevail over   those contained in Sections 19 and 39 of the Slum Clearance Act.”

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30. Accordingly, in the context of the conflict between the two Acts, this  

Court held in Ashoka Marketing, as follows:-

“61. The principle which emerges from these decisions is that in the   case of inconsistency between the provisions of two enactments, both  of which can be regarded as special in nature, the conflict has to be  resolved by reference to the purpose and policy underlying the two   enactments and the clear intendment conveyed by the language of the   relevant provisions therein.”

It  becomes  relevant  to  note  the  conclusion  arrived  at  by  this  Court  in  Ashoka  

Marking Co.’s case, which is in following words:-

“70. For  the  reasons  aforesaid,  we  are  unable  to  accept  the  contention  of  the  learned  counsel  for  the  petitioners  that  the  provisions contained in the Public Premises Act cannot be applied to  premises which fall within the ambit of the Rent Control Act.  In our  opinion,  the  provisions  of  the Public  Premises  Act,  to  the  extent they cover premises falling within the ambit of the  Rent Control Act, override the provisions of the Rent Control   Act and  a  person  in  unauthorized  occupation  of  public  premises  under Section 2(e) of the Act cannot invoke the protection of the  Rent Control Act.”                                     …  (emphasis supplied)

31. The impugned judgment  in the present  case relies  upon the above  

observations to hold that once the premises were covered under the Public Premises  

Act, that Act will override the Rent Control Act and therefore in the instant case,  

standard  rent  application  was  not  maintainable.   On  the  other  hand,  it  was  

submitted on behalf of the appellant that the above statement in paragraph 70 of  

Ashoka Marketing Judgment,  when it speaks of ‘provisions to the extent they  

cover’, it means the ‘subject matter’ covered by the provisions under the two acts.  

In this context, it must also be noted that the controversy in the case of Ashoka  

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Marketing was  with  respect  to  the  subject  of  eviction  of  the  unauthorized  

occupants from the public premises.  Eviction of tenants in general was a subject  

covered by both the statutes under considerations before the Court.  However, the  

Public Premises Act contains the special provisions for the eviction of unauthorized  

occupants from the public premises, but for which they would fall within the ambit  

of the Rent Control Act.  Consequently, in view of the above dicta, the proceedings  

under the Public Premises Act were held to be valid and legal, and not those under  

the Delhi Rent Control Act.  The subject matter of controversy in our case is with  

respect to the fixation of standard rent, which is not covered under the provision in  

the Public Premises Act.  On the other hand the same is very much covered under  

the  MRC Act.   The  overriding  effect  given to  Public  Premises  Act  cannot  mean  

overriding with reference to a matter which was not dealt with by that Act, since the  

Public  Premises  Act  did  not  claim  to  cover  the  subject  other  than  eviction  of  

unauthorized  occupants  from  public  premises  and  recovery  of  arrears  of  rent.  

Therefore, it was submitted that the application for fixation of standard rent will be  

very much maintainable under the provisions of the MRC Act.   

Public Premises Act vis-à-vis the Bombay Rent Act and the MRC Act on  

the issue of eviction of unauthorised occupants from Public Premises-

32. Before we deal with the rival submissions on the maintainability of the  

standard rent application, we may note that with respect to the aspect of eviction of  

unauthorised occupants from the public  premises, it  is now well  settled that the  

34

Public Premises Act will apply and not the Bombay Rent Act or the subsequent MRC  

Act.   

(i) In  Kaiser-I-Hind  Pvt.  Ltd.  &  Anr.  vs.  National  Textile  Corpn.  

(Maharashtra North) Ltd. & Ors. [2002 (8) SCC 182]  one of the questions  

before  the  Constitution  Bench  was  whether  the  provisions  of  Bombay  Rent  Act  

having been re-enacted after 1971 by the State Legislature with the assent of the  

President will  prevail  over the provisions of  the Public Premises Act by virtue of  

Article  254  (2)  of  the  Constitution.  The  court  noted  that  although  the  Public  

Premises Act received the assent of President on 23.8.1971, in view of Section 1 (3)  

of Public Premises Act, it is deemed to have come into force from 16.9.1958.  On  

the other hand, the duration of Bombay Rent Act was extended by Maharashtra Act  

No. 12 of 1970. Therefore, the Court held specifically in para 40 of its judgment that  

Article  254 (1)  was the relevant  one in  the present  case,  and to the extent  of  

repugnancy, the State law will not prevail under Article 254 (1), and the law made  

by the Parliament shall hold good.   

(ii) Between  the  Public  Premises  Act  and  the  MRC  Act  this  Court  held  in  

Crawford Bayley & Co. & Ors. v. Union of India & Ors. [2006 (6) SCC 25]  

that  to  the extent  specific  provisions  were  made in  the Public  Premises  Act  for  

eviction of unauthorized occupants, that Act will apply with respect to the Premises  

of the State Bank of India which were in dispute in that matter and not the MRC Act.

Other submissions on behalf of the appellant -

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33. The learned senior counsel for the appellant Mr. Hansaria relied upon  

quite  a  few  judgments  in  support  of  his  submission  that  the  Standard  Rent  

Application in the present case was very much maintainable under the MRC Act.  We  

will refer to some of them which lay down the principles relevant for our purpose.  

In M/s Jain Ink Manufacturing Company Vs. Life Insurance Corporation of  

India and Another which is a judgment of 3 Judges reported in [1980 (4) SCC  

435], the provisions of the Public Premises Act were considered in the light of those  

of Delhi Rent Control Act 1958, and the Slum Areas (Improvement) and Clearance  

Act 1956.  In that matter L.I.C had purchased the premises in question in which the  

appellant was a tenant inducted by the original owner of the premises.  L.I.C had  

initiated the proceedings for the eviction of the tenant before the estate officer.  The  

appellant had challenged the applicability of the Public Premises Act.  This Court  

rejected that objection.  The observations of this Court in paragraph 8 and 9 are  

relevant for our purpose which read as follows:-

  8. …… So far as the Premises Act is concerned it operates in a very  limited  field  in  that  it  applies  only  to  a  limited  nature  of  premises   belonging only to particular sets of individuals, a particular set of juristic   persons like companies, corporations or the Central Government.  Thus,  the  Premises  Act  has  a  very  limited  application. Secondly,  the  object  of  the  Premises  Act  is  to  provide  for  eviction  of  unauthorised   occupants  from public  premises  by  a  summary  procedure  so  that  the   premises may be available to the authorities mentioned in the Premises  Act which constitute a class by themselves. …….

 9. Thus, it would appear that both the scope and the object of the   Premises Act is quite different from that of the Rent Act. The Rent Act is   of much wider application than the Premises Act  inasmuch as it   applies  to  all  private  premises  which  do  not  fall  within  the  limited   exceptions indicated in Section 2 of the Premises Act. The object of the  Rent  Act  is  to  afford  special  protection  to  all  the  tenants  or  private   landlords or landlords who are neither a corporation nor government or   

36

corporate  bodies.  It  would be seen that  even under  the Rent  Act,  by  virtue of an amendment a special category has been carved out under   Section 25-B which provides for special procedure for eviction to landlords  who require  premises  for  their  personal  necessity.  Thus,  Section 25-B   itself becomes a special law within the Rent Act. On a parity of reasoning,   therefore, there can be no doubt that the Premises Act as compared to   the  Rent  Act,  which  has  a  very  broad spectrum,  is  a  special  Act  and  overrides the provisions of the Rent Act.”

        (emphasis supplied)

As is seen from this quotation, just as there is a special category carved out under  

the Rent Control Act in favour of the landlord who requires premises for his personal  

necessity, somewhat a similar provision is made under the Public Premises Act.  The  

reasonable and bonafide requirement of the landlord to occupy the premises has  

been made a separate permissible ground for recovery of possession under section  

16 (1) (g) of the MRC Act.  This section 16 (1) (g) is similar to section 25 B referred  

into the above judgment, and it reads as follows:-

“16. When landlord may recovery possession

(1) Notwithstanding anything contained in this Act but subject to  the  provisions  of  section  25,  a  landlord  shall  be  entitled  to  recover  possession of any premises if the court is satisfied –   

(a) …………. (b) …………. (c) …………. (d) …………. (e) …………. (f) …………. (g) that the premises are reasonably and bona fide required by  

the landlord for occupation by himself or by any person for whose benefit   the  premises  are  held  or  where  the  landlord  is  a  trustee  of  a  public   charitable  trust  that  the  premises  are  required  for  occupation  for  the   purposes of the trust; or”

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The Public Premises Act creates a forum for eviction of the unauthorised occupants  

and  provides  for  a  special  procedure  for  recovery  of  the  premises  from  such  

occupants.   Unauthorised occupation has  been defined in  a vide manner  and it  

includes the continuation in occupation of any person of the public premises after  

his  authority  to  occupy  has  expired  or  has  been  determined  for  any  reason  

whatsoever.  It would as well include the determination of the authority to occupy  

whenever  the  premises  are  required  bonafide  and  reasonably  by  the  public  

authority.  There was no such special procedure for the public bodies until the Public  

Premises Act was enacted.  When it comes to the requirement of the Government or  

the Public Corporation, now the public body will be taking steps under the Public  

Premises Act.  It is, however, relevant to note as held in this judgment that the  

Public Premises Act has a very limited application as against the Rent Act which  

affords a special protection to the tenants by fixing standard rent and requiring the  

landlord to maintain the essential services.  It was, therefore, submitted that the  

standard rent application under the Rent Act would remain available to the tenant  

even if the premises are otherwise covered under the Public Premises Act for the  

purposes  of  eviction  and  recovery  of  arrears  of  rent  from  the  unauthorised  

occupants.  

The question of Repugnancy -

34. The question is as to whether the provision for fixation of standard  

rent and the provision requiring landlord to maintain the essential services under the  

MRC Act, which is a subsequent Act passed by the State Legislature are in any way  

38

repugnant  to  the  Public  Premises  Act  which  is  an  earlier  Act  passed  by  the  

Parliament.  The distribution of legislative powers between the Union of India and  

the  States  has  been  provided  in  the  Seventh  Schedule  of  the  Constitution.   It  

consists of List I which is the Union List, List II which is the State List and List III  

which  is  the  Concurrent  List.   The  question  of  repugnancy  can  arise  only  in  

connection  with  the  subjects  which  are  enumerated  in  the  Concurrent  List  with  

respect to which both the Union and the State Legislatures have the concurrent  

power to legislate, and when the State Legislature makes a law on a subject on  

which the Parliament has already made a law.  It is to deal which such a conflict  

that Article 254 has been enacted.  Article 254 of the Constitution deals with the  

question of inconsistency between the laws made by the Parliament and laws made  

by the Legislatures of States.  This Article reads as follows:-

“ 254. Inconsistency between laws made by Parliament  and laws made by the Legislatures of States - (1) If any provision of a law made by the Legislature of a State is  repugnant  to  any  provision  of  a  law  made  by  Parliament  which   Parliament is competent to enact, or to any provision of an existing  law with respect to one of the matters enumerated in the Concurrent  List, then, subject to the provisions of clause (2), the law made by   Parliament,  whether  passed  before  or  after  the  law  made  by  the   Legislature of such State, or, as the case may be, the existing law,  shall prevail and the law made by the Legislature of the State shall, to   the extent of the repugnancy, be void.   (2) Where a law made by the Legislature of a State  with respect to   one of the matters enumerated in the Concurrent List  contains any  provision  repugnant  to  the  provisions  of  an  earlier  law  made  by   Parliament or an existing law with respect to that matter, then, the law  so made by the Legislature of such State shall, if it has been reserved  for  the consideration of  the President  and has received his  assent,   prevail in that State:

39

Provided  that  nothing  in  this  clause  shall  prevent  Parliament  from  enacting  at  any  time  any  law  with  respect  to  the  same  matter   including a law adding to, amending, varying or repealing the law so   made by the Legislature of the State.”

35. The question of repugnancy between the law made by the Parliament  

and  the  law made  by  the  State  Legislature  may  arise  in  cases  when  both  the  

legislation occupy the same field with respect to one of the matters enumerated in  

List III and where a direct conflict is seen between the two.  The Principles laid  

down by a bench of 3 Judges in  Hoechst Pharmaceuticals Ltd. Vs. State of  

Bihar reported in [1983 (4) SCC 45] were reiterated by a Constitution Bench in  

State  of  West  Bengal  Vs.  Kesoram Industries  Ltd.  And  Ors.  reported  in  

[2004 (10) SCC 201].  Para 31 (5) thereof is instructive for our purpose and it  

reads as follows:-

“31  (5) Where  the  legislative  competence  of  the   legislature of any State is questioned on the ground that it encroaches   upon the  legislative  competence  of  Parliament  to  enact  a  law,  the  question one has to ask is whether the legislation relates to any of the   entries in List I or III. If it does, no further question need be asked   and Parliament's legislative competence must be upheld. Where there  are three lists containing a large number of entries, there is bound to   be some overlapping among them. In such a situation the doctrine of   pith and substance has to be applied to determine as to which entry   does a given piece of legislation relate. Once it is so determined, any  incidental trenching on the field reserved to the other legislature is of   no consequence. The court has to look at the substance of the matter.   The doctrine of pith and substance is sometimes expressed in terms of   ascertaining the true character of legislation. The name given by the   legislature to the legislation is immaterial. Regard must be had to the   enactment as a whole, to its main objects and to the scope and effect   of its provisions. Incidental and superficial encroachments are to be   disregarded.”

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36. The  question  therefore  to  be  examined  is  as  to  whether  the  two  

legislations occupy the same field.  If they do not, then there is no repugnancy.  

Unless the provisions are irreconcilable, there will be a presumption in favour of the  

constitutionality.   In  Ch.  Tika  Ramji  and  Ors.  etc.  v.  The  State  of  Uttar  

Pradesh and Ors.  [AIR 1956 SC 676],  the  question  before  the  Constitution  

Bench was as to whether the UP Sugarcane (Regulation of Supply and Purchase)  

Act,  1953 was repugnant to the Industries (Development and Regulation) Act of  

1951 which was a Central  Act.   The Apex Court  noted that  Section 18G of the  

Central Act deals with finished products and not raw materials.  This section did not  

cover the field of sugarcane which was covered under the UP Act.  The Court held  

that there was no repugnancy between the two legislations, since one deals with the  

finished products whereas the other deals with raw materials.

37. In the case of  M. Karunanidhi vs. Union of India & Anr.  [1979  

(3) SCC 431]  a Constitution Bench was concerned with the question as to whether  

certain provisions of the Tamil  Nadu Public Men (Criminal  Misconduct) Act 1973,  

were repugnant  to the provisions of  Prevention of  Corruption Act 1947 and the  

Criminal  Law Amendment Act 1952.  The appellant was being prosecuted under  

sections 161, 468 and 471 of Indian Penal Code and section 5 (2) read with section  

5 (1) (d) of the Prevention of Corruption Act 1947.  The Court referred to earlier  

decisions including the one in Deep Chand Vs. State of U.P. [AIR 1959 SC 648]  

wherein  it  was  held  that  the  repugnancy  between  the  two  statutes  may  be  

ascertained  by  considering  whether  the  Parliament  intended  to  lay  down  an  

41

exhaustive  code  in  respect  of  the  subject  matter  considered  in  the  State  Act  

replacing the Act of the State Legislature. The Constitution Bench then laid down the  

principles governing the rule of repugnancy in paragraph 35 which are as follows:-  

35. On a careful consideration, therefore, of the authorities referred to   above, the following propositions emerge: 1. That in order to decide the question of repugnancy it must be shown  that  the  two  enactments  contain  inconsistent  and  irreconcilable  provisions, so that they cannot stand together or operate in the same  field. 2. That there can be no repeal by implication unless the inconsistency   appears on the face of the two statutes. 3. That where the two statutes occupy a particular field, but there is   room or  possibility  of  both  the  statutes  operating  in  the  same  field  without coming into collision with each other, no repugnancy results. 4.  That where there is no inconsistency but a statute occupying the   same field seeks to create distinct and separate offences, no question of   repugnancy  arises  and both  the  statutes  continue  to  operate  in  the   same field.

Consequently  the Court  held that  there was no conflict  amongst  the legislations  

concerned.

38. The question with respect  to  conflict  between two such legislations  

came up before a Bench of three Judges in the case of Vijay Kumar Sharma and  

Ors. Vs. State of Karnataka and Ors. reported in [1990(2) SCC 562], where  

the question was whether there was any conflict between the Karnataka Contract  

Carriages (Acquisition) Act 1976 and Motor Vehicles Act, 1988.  This Court looked  

into the judgments holding the field and held that there was no conflict between the  

two.  It laid down the law in paragraph 53 as follows:-

“53. The aforesaid review of the authorities makes it clear that  whenever  repugnancy  between  the  State  and  Central  legislation  is  alleged, what has to be first examined is whether the two legislations  

42

cover or relate to the same subject matter. The test for determining the   same is the usual one, namely, to find out the dominant intention of the   two legislations. If the dominant intention, i.e. the pith and substance of   the two legislations is different, they cover different subject matters. If   the subject matters covered by the legislations are thus different, then   merely  because  the  two legislations  refer  to  some allied  or  cognate  subjects they do not cover the same field. The legislation, to be on the  same subject matter must further cover the entire field covered by the  other.  A  provision  in  one  legislation  to  give  effect  to  its  dominant   purpose may incidentally  be on the same subject  as  covered by the   provision of the other legislation. But such partial coverage of the same  area in a different context and to achieve a different purpose does not  bring about the repugnancy which is intended to be covered by Article  254(2). Both the legislations must be substantially on the same subject   to attract the article.”

In the event of two Acts governing a common field, whether both  

can apply for different purposes-

39. There could be provisions for certain purposes in one statute, and for  

another purpose in another statute, though both govern the common field.  Thus, in  

Krishna Distt. Coop. Mktg. Society Ltd. Vijayawada vs. N.V. Purnachandra  

Rao & Ors. [1987 (4) SCC 99],  the issue was, with respect to the application of  

section  25-F  of  Industrial  Disputes  Act,  to  the  employees  who  were  otherwise  

governed under the A.P. Shops and Establishments Act, 1966. In that context this  

Court had to examine whether there was any conflict between the two Acts and  

particularly when the A.P. Act was a later act and it had received the assent of the  

President.  The question was whether compliance with Section 25-F of the Industrial  

Disputes Act could be insisted for establishments governed under the Shops and  

Establishments Act.  This Court held that those provisions will  be applicable and  

there was no conflict between the provisions of the two Acts. Section 25-F of the  

43

Central Act provided for the conditions precedent for retrenchment, and the non-

compliance therewith made the order of retrenchment fatal.  Section 41 (1) and (3)  

of  the A.P.  Act  provided for  the authorities  to settle  the disputes arising out of  

retrenchment.  Section 25 J (2) of the I.D. Act reads as follows:-

“25-J.Effect of laws inconsistent with this chapter.-(1)…….  

(2)  For  the removal  of  doubts,  it  is  hereby declared  that  nothing  contained  in  this  chapter  shall  be  deemed  to  affect the provisions of any other law for the time being in   force  in  any  State  insofar  as  that  law  provides  for  the  settlement of industrial disputes, but the rights and liabilities  of employers and workmen insofar as they relate to lay off   and retrenchment shall be determined in accordance with the   provisions of this chapter.”

The court noted in para 8 that “the State Act does not contain any  

express provision making the provision relating to retrenchment in the Central Act  

ineffective in so far as Andhra Pradesh is concerned”.  What is observed in para 6 is  

relevant for our purpose:-

“6…….  Sub-section (1) of Section 25-J of the Central Act lays down  that  Chapter  V-A,  shall  have  effect  notwithstanding  anything  inconsistent therewith contained in any other law.  The proviso to that   sub-section however saves any higher benefit available to a workman  under any law, agreement or settlement or award. Sub-section (2) of  Section  25-J  however  makes  a  distinction  between  any  machinery  provided by any State law for settlement of industrial disputes and the  substantive  rights  and  liabilities  arising  under  Chapter  V-A  of  the   Central Act where a lay off or retrenchment takes place. It provides   that while Section 25-J would not affect the provisions in a State law   relating to settlement of industrial disputes, the rights and liabilities of   employers  and  workmen  insofar  as  they  relate  to  lay  off  and   retrenchment shall be determined in accordance with Chapter V-A of   the Central Act. It is thus seen that Section 41(1) and Section 41(3) of   the  State  Act  prescribe  alternative  authorities  to  settle  a  dispute  arising out of  a retrenchment.  Those authorities  may exercise their   

44

jurisdiction under the State Act but they have to decide such dispute in   accordance with the provisions of Chapter V-A………….”

40. Similarly, in the case of  National Engineering Industries Ltd. vs.  

Shri Kishan Bhageria & Ors. [1988 Supp. SCC 82], the question was whether a  

Reference under Section 10 of the Industrial Disputes Act, 1947 could be sought by  

the employees covered under the Rajasthan Shops and Establishments Act, 1958.  

This Court held that it would be so.  In a similar way in  Bharat Hydro Power  

Corpn. Ltd. & Ors.  v. State of Assam & Anr. [2004 (2) SCC 553], this Court  

held in the context of Electricity Act 1910, and Assam Act No. 1 of 1997 that if two  

legislations operate in different fields without encroaching upon each other fields  

there cannot be any repugnancy.  

41. In the field of criminal law also the same approach has been adopted  

by this Court.  In  State of Maharashtra v. Bharat Shanti Lal Shah and Ors.  

[2008 (13) SCC 5], the question was with respect to the conflict between the  

Maharashtra  Control  of  Organized  Crime  Act,  1999  (MCOC  Act  for  short)  and  

Telegraph Act, 1885.  In Zameer Ahmed Latifur Rehman Sheikh vs. State of  

Maharashtra & Ors. [2010 (5) SCC 246], the question was with respect to the  

conflict between the MCOC Act and Unlawful Activities (Prevention Act), 1967.  In  

both matters this Court took the view that mere difference in the two Acts is not  

sufficient, and an incidental encroachment is irrelevant.  This Court held that there  

was no conflict in both the cases.

45

Fixation of Standard Rent in the context of exemptions from the  

Rent Control Laws – The question of remedy

42. Whatever be the object of granting exemption, where the object is to  

see that the properties of the State or semi-state bodies should not suffer by the  

rigours  of  the  Rent  Control  Laws  or  the  possession  of  the  public  premises  be  

recovered  expeditiously,  “the  Courts  have  expressed  their  views  that  these  

authorities  being  public  bodies  should  so  behave  as  not  to  act  contrary  to  the  

policies  laid  down  in  the  Rent  Control  Laws  namely  not  to  increase  the  rent  

unreasonably or excessively, nor to evict their tenant unreasonably or arbitrarily,  

save and except in public interest.” (J.H. Dalal in his Commentary on the Bombay  

Rent Act, Fifth Edition, Page 65).   

43. In this context one of the earliest cases coming before the Bombay  

High court was  Rampratap Jaidayal Vs. Dominion of India reported in  [AIR  

1953 Bom 170].   Central Government had served upon the appellant tenant a  

notice to quit and the suit for ejectment was decreed.  In the first appeal filed by  

the defendant tenant the question arose with respect to the nature of exemption  

available to the Government under section 4 (1) of the Bombay Rent Act.   The  

appeal  filed  was  dismissed  by  the  Division  Bench  consisting  of  Chagla  C.J  and  

Gajendragadkar, J (as he then was in the Bombay High Court).  What was observed  

by Chagla C.J. in the judgment with respect to the rent to be charged by the public  

bodies  is  relevant  for  our  purpose.   Amongst  other  arguments  the  exemption  

granted to the State was challenged as amounting to unreasonable classification hit  

46

by Article  14  of  the  Constitution.  The  Division  Bench  repelled  the  argument  by  

relying  upon  the  judgment  of  a  constitution  bench  of  this  Court  in  State  of  

Bombay Vs. F.N. Balsara reported in [1951 SCR 682] equivalent to [53 Bom.  

LR 982 (SC)], wherein Fazl Ali, J had drawn seven principles on the meaning and  

scope of Article 14 of the Constitution from the earlier judgment of this Court in  

‘Chiranjitlal v. Union of India’ reported in [AIR 1951 SC 41], and relied upon  

the very first principle therefrom and observed as follows:-

“8.  …. perhaps attention might be drawn to the very  first  where  the  Supreme  Court  emphasizes  the  fact  that  the   presumption  is  always  in  favour  of  the  constitutionality  of  an  enactment  and  this  presumption  arises  from  the  fact  that  the  Legislature understands and correctly appreciates the needs of  its  own  people  and  that  its  laws  are  directed  to  problems  made  manifest by experience and therefore it must always be presumed  that discriminations are based on adequate grounds……”

Thereafter what the Court observed at the end of this para 8 is relevant for our  

purpose:-

“ ..…. it is clear that in this case the Legislature was not   in any sense exempting the Government from the operation of the  Act in order to permit the Government to do the very thing which the  Legislature was prohibiting in the case of landlords who were not a  local authority or Central or State Government.  It is not too much to  assume, as the Legislature did in this case assume, that the very  Government whose object was to protect the tenants and prevent   rent being increased and prevent people being ejected, would not   itself when it was the landlord do those very things which it sought   to  prohibit  its  people  from  doing,  and  therefore  the  underlying   assumption of this exemption is that Government would not increase   rents and would not eject tenants unless it was absolutely necessary  in public interest and unless a particular building was required for a   public purpose.”

47

44. In  another  case  Baburao  Shantaram  More  Vs.  The  Bombay  

Housing  Board  reported  in  [AIR  1954  SC  153]  which  came  up  before  a  

Constitution Bench of this Court, the question was with respect to the eviction of a  

tenant of the then Bombay Housing Board, constituted under the Bombay Housing  

Board Act, 1948.  A decree for eviction had been passed against the tenant which  

had been upheld by the High Court.  The appeal therefrom was dismissed by this  

Court.  While upholding the exemption of the Bombay Housing Board under section  

4 of the Bombay Rent Act, the Court held that the classification was based on an  

intelligible differentia, and held that the tenant or the local authority or the board  

were not in need of such protection as the tenants of private landlords.  This was for  

the reason as stated by S.R. Das J (as he then was) for the Court:-

“6. …. It is not to be expected that the Government or  Local authority or the Board would be actuated by any profit   making motive so as to unduly enhance the rents or eject the  tenants from their respective properties as private landlords are  or are likely to be…..”

45. In  M/s Dwarkadas Marfatia V. Bombay Port Trust reported in  

[1989 (3) SCC 293], the trustees of Bombay Port had evicted the appellant from a  

plot of land and allotted it to another tenant, and obtained the decree of eviction.  

While upholding the decree, this Court examined the question of exemption of a  

local authority under section 4 of the Bombay Rent Act. In paragraph 14 and 15 of  

its judgment a Bench of 3 Judges quoted with approval the above referred quotation  

of Chagla C.J. and S.R. Das, J, and thereafter observed as follows in para 17:-

48

“17.  It,  therefore,  follows  that  the  public   authorities  which  enjoy  this  benefit  without  being  hidebound by the requirements of the Rent Act must act  for public benefit.  Hence, to that extent, this is liable to  be  gone  into  and  can  be  the  subject  matter  of  adjudication.”

(emphasis  supplied)

What this Court  observed further per Sabyasachi  Mukharji,  J.  (as he than  

was) in paragraph 24 is relevant for our purpose:-

“24.  The field of letting and eviction of tenants is  normally governed by the Rent Act. The Port Trust is statutorily   exempted from the operation of the Rent Act on the basis of its   public/governmental  character.  The legislative assumption  or expectation as noted in the observations of Chagla,   C.J.  in  Rampratap  Jaidayal  case cannot  make  such  conduct  a  matter  of  contract  pure  and  simple. These  corporations must act in accordance with certain constitutional   conscience  and  whether  they  have  so  acted,  must  be  discernible from the conduct of such corporations…..”

(emphasis  supplied)

Thereafter, in para 27 the Court further observed in the following words:-

“27.   We are inclined to accept the submission that every  activity of a public authority especially in the background of   the assumption on which such authority enjoys immunity from  the rigours of the Rent Act, must be informed by reason and  guided by the public interest. All exercise of discretion or  power  by  public  authorities  as  the  respondent,  in   respect  of  dealing  with  tenants  in  respect  of  which   they have been treated separately and distinctly from  other landlords on the assumption that they would not   act  as  private  landlords,  must  be  judged  by  that   standard. If  a  governmental  policy  or  action  even  in   contractual matters fails to satisfy the test of reasonableness,   it  would  be  unconstitutional.  See  the  observations  of  this   Court  in  Kasturi  Lal  Lakshmi  Reddy and  R.D.  Shetty v.  

49

International Airport Authority of India (SCC pp. 505-06 : SCR  p. 1034).”

(emphasis supplied)

Yardstick for Standard Rent:-

46. Relying upon the above judgments Mr. Hansaria submitted that the  

Public  authorities  cannot raise rent arbitrarily.   In this behalf  he referred to the  

guidelines framed by the Central Government to prevent arbitrary use of the power  

under  this  Act.   These  guidelines  are  issued  by  the  Central  Government  under  

resolution dated 30.5.2002 and published in the Government of India Gazette dated  

8.6.2002. Guidelines No. 2 (i) and 2 (iii) are relevant for our purposes.  He relied  

upon the judgment of a Division Bench of Bombay High Court in Persis Kothawala  

vs.  LIC  reported  in 2004  (4)  BCR 610   to  submit  that  these  guidelines  are  

expected to be followed.  These guidelines are as follows:-

“MINISTRY OF URBAN DEVELOPMENT AND POVERTY ALLEVIATION

(DIRECTORATE OF ESTATES)

RESOLUTION

New Delhi, the 30th May 2002

Subject: Guidelines to prevent arbitrary use of powers  to  evict  genuine  tenants  from public  premises  under  the  control of Public Sector Undertakings/financial institutions.

No.21013/1/2000-Pol.I – The question of notification   of  guidelines  to  prevent  arbitrary  use  of  powers  to  evict   genuine tenants from public premises under the control of   Public  Sector  Undertakings/financial  institutions  has  been  under consideration of the Government for some time past.

50

2. To  prevent  arbitrary  use  of  powers  to  evict   genuine tenants from public premises and to limit the use of   powers by the Estate Officers appointed under Section 3 of   the P.P.(E) Act, 1971, it has been decided by Government to   lay down the following guidelines:-

(i) The provisions of the Public Premises (Eviction  of Unauthorised Occupants) Act, 1971 [P.P. (E) Act, 1971]  should  be  used  primarily  to  evict  totally  unauthorised  occupants of the premises of public authorities or subletees,   or employees who have ceased to be in their service and  thus ineligible for occupation of the premises.

(ii) The provisions of the P.P.(E) Act, 1971 should  not be resorted to either  with a commercial  motive or to  secure  vacant  possession  of  the  premises  in  order  to  accommodate  their  own  employees,  where  the  premises  were  in  occupation  of  the  original  tenants  to  whom the   premises  were  let  either  by  the  public  authorities  or  the  persons from whom the premises were acquired.  

(iii) A person in occupation of any premises should  not be treated or declared to be an unauthorised occupant   merely on service of notice of termination of tenancy, but   the  fact  of  unauthorised  occupation  shall  be  decided  by  following the due procedure of law.  Further, the contractual   agreement shall  not be wound up by taking advantage of   the provisions of the P.P. (E) Act, 1971.  At the same time, it   will  be  open  to  the  public  authority  to  secure  periodic  revision  of  rent  in  terms  of  the  provisions  of  the  Rent   Control Act in each State or to move under genuine grounds  under  the  Rent  Control  Act  for  resuming  possession.   In  other words, the public authorities would have rights similar   to private landlords under the Rent Control Act in dealing  with genuine legal tenants.

(iv) It is necessary to give no room for allegations   that evictions were selectively resorted to for the purpose of   securing and unwarranted increase in rent, or that a change  in  tenancy  was  permitted  in  order  to  benefit  particular   individuals  or  institutions.   In  order  to  avoid  such  imputations or abuse of discretionary powers, the release of  premises  or  change of  tenancy should  be decided at  the  level of Board of Directors of Public Sector Undertakings.

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(v) All the Public Undertakings should immediately   review all pending cases before the Estate Officer or Courts   with  reference  to  these guidelines,  and withdraw eviction  proceedings against  genuine tenants on ground otherwise   than as  provided under  these guidelines.   The provisions   under the P.P. (E) Act, 1971 should be used henceforth only   in accordance with these guidelines.

3. These orders take immediate effect.

VINEETA RAI Additional Secy.”

47. Mr. Hansaria pointed that when the MRC Act was being framed, LIC  

specifically represented to Maharashtra State Law Commission that it be exempted  

from the coverage of the proposed law.  This is recorded in Twelth Report of July  

1979 of the State Law Commission which finds a reference in paragraph 33 of the  

Bombay High Court  judgment in  Minoo Framroze Balsara Vs.  The Union of  

India & ors. [AIR 1992 Bom 375].  However, that representation of L.I.C was  

not accepted.  Lateron in view of the amendment of section 2 (e) of the Public  

Premises Act, L.I.C came to be covered under the Public Premises Act, but was not  

exempted from the MRC Act.   

48. Lastly, Mr. Hansaria relied upon the judgment of a Division Bench of  

Karnataka High Court in the case of Bharath Gold Mines Ltd vs. Kannappa [ILR  

1988 KAR 3092] equivalent to 1989 (2) All India Rent Control Journal 154, where  

the Division Bench has held that the power to evict does not include the power to fix  

rent.  Fixation of rent was independent from eviction, and it was not dealt with  

under  the  Public  Premises  Act.   The Public  Premises  Act  does  not  override  the  

52

provisions of the Karnataka Rent Control  Act, 1961 regarding the fixation of fair  

rent.  It is submitted that the same approach ought to be adopted in the present  

case.   

Reply on behalf of L.I.C -

49. The learned Additional Solicitor General Mr. Rawal appearing for the  

respondents submitted that the appellant had agreed to 35% rise in the rent every  

five years.  Section 7 of the Public Premises Act provides for payment of rent by the  

authorized  tenant,  and  makes  a  provision  for  damages  for  the  unauthorized  

occupation.   A  hearing  is  provided  for  recovery  of  the  arrears  of  rent  and  the  

damages under that section, and the order, if any, passed against the occupant is  

appealable under Section 9 of the Act.  The order is given finality under Section 10  

of the Act.  He pointed out that as noted by this Court also in  Shangrila Food  

Products Ltd. and Another Vs. L.I.C. and Another reported in [1996 (5) SCC  

54], that “unless the occupant is first adjudged as an unauthorized occupant, his  

liability  to pay damages does not arise.   In other words,  if  he is  an authorized  

occupant,  he  may  be  required  to  pay  rent  but  not  damages.   The  quality  of  

occupation and the quality of recompense for the use and occupation of the public  

premises go hand in hand and are interdependent”.

50. The rent was being fixed on one of the three yardsticks, i.e.  (i) as per  

the document of lease, (ii) as per the contract between the parties, or (iii) as per the  

grant.   If the arrears of rent remained to be recovered from the tenant, there is a  

53

power to recover the same even from the heirs and legal representatives under  

Section  13  of  the  Act,  and  if  the  rent  or  damages  are  not  paid,  they  can  be  

recovered as arrears of land revenue under Section 14 and an unlawful occupant  

can be prosecuted under Section 11 of the Act.  This being the position the idea of  

standard rent was foreign to the Public Premises Act.   

51.  A reference was made to the rules which are framed under the Act  

alongwith the relevant forms framed thereunder.  Thus, Form D contains the format  

for the notice under Section 7 (3) read with Sub-section (1) thereof which is to be  

issued by the Estate Officer for calling the tenant for an enquiry into the arrears of  

rent.  Form F is the format of the notice for enquiry for determining the damages for  

unauthorized occupation to be assessed under Section 7 (3) read with Sub-section  

(2) thereof.   It  was, therefore,  submitted that  necessary mechanism is provided  

under the Act and the Rules.

52. Thereafter it was pointed out that all that the respondents had done  

was to pass on the amount of property tax demanded by the Municipal Corporation  

to the appellant.   It  was submitted that when the respondent received a notice  

dated 23.3.2006 from the Municipal Corporation of Mumbai to enhance the property  

tax,  to  begin  with  the  respondent  objected to  the  revision  by their  reply  dated  

13.4.2006.   The  officers  of  the  respondent  attended  the  proceedings  in  the  

municipal  office  whereafter  the  Municipal  Corporation  reduced  their  demand  by  

10%.  It is only a proportion of this amount which was passed on to the appellant  

54

and which is  sought to be recovered and they should not make any grievances  

about the same.

53. The respondents then relied upon the judgment of a Division Bench of  

Bombay High Court in Minoo Framroze Balsara (supra). In that matter the challenge  

to the validity of the Public Premises Act by invoking Article 14 was repelled by the  

High Court.   It  is  however,  material  to  note  that  this  judgment  was  essentially  

concerning eviction of unauthorized occupants and did not deal with the aspect of  

fixation of standard rent.

54. Mr. Rawal then referred to us two judgments of this Court.  Firstly, he  

referred to para 10 of Jain Ink Mfg. Co. vs. LIC (supra), wherein this Court had  

held that once the Public Premises Act applies, the Delhi Rent Control Act will stand  

superseded.  He then referred to Prithipal Singh v. Satpal Singh (dead) thr. its  

Lrs. [2010 (2) SCC 15]  where in para 29 this court has held that the Delhi Rent  

Control Act and the Maharashtra Act are pari-materia, and therefore, on that footing  

he  submitted  that  by  applying  the  judgment  in  Jain  Ink  Mfg.  Co.  (supra),  

Maharashtra Act also gets eclipsed by the Public Premises Act.  We have already  

referred to the judgment in Jain Ink Mfg. Co. (supra).  The judgment was in the  

context of eviction from Public Premises and not concerning fixation of standard  

rent, and therefore, the observations in para 10 thereof will have to be looked into  

from that point of view.

55

55. The submission of Mr. Rawal was that an exclusionary clause has to be  

read strictly.  In the present case Section 2 (f) read with Section 15 (d) of the Act  

dealt with the definition of rent and exclusion of proceedings for recovery of rent by  

way of Civil suit, and there was no non-obstante clause in the MRC Act.  In this  

context, he relied upon a judgment of this Court in  Church of North India Vs.  

Lavajibhai Ratanjibhai reported in [2005 (10) SCC 760]. In that matter, after  

examining the scheme of Bombay Public Trusts Act, 1950 and relying upon the dicta  

of the constitution bench in Dhulabhai Vs. State of M.P. reported [AIR 1969 SC  

78], this Court had held that a suit for declaration as to the succession to a public  

trust was not maintainable, since the authorities under the Bombay Public Trusts Act  

had exclusive jurisdiction.  A similar approach was suggested in the present case.

56. It was then submitted that the MRC Act excludes some tenants from  

the protection of the rent Act such as the Banks, Insurance Companies and Multi  

National Companies being rich tenants.  In the same way, under the Public Premises  

Act,  fixing  of  standard  rent  has  been excluded,  and that  should  be  held  to  be  

permissible.  If a tenant is aggrieved by the rent fixed, his remedy will be to invoke  

Article  226  of  the  Constitution,  but  one  cannot  permit  part  of  the  proceedings  

regarding arrears of rent before the Court of the Estate Officer, and another part  

concerning fixation of standard rent before the Rent Controller.

57. With respect to the guidelines framed by the Central Government, it  

was  submitted  by Mr.  Rawal  that  non-statutory  guidelines  are  to  be  treated  as  

advisory in character and present guidelines need not be read as conferring any  

56

legal rights on the tenants.  He relied upon paragraph 23 of the judgment of a  

Bench of two Judges of this court in  New India Assurance Co. Ltd. Vs. Nusli  

Neville Wadia reported in [2008 (3) SCC 279] in this behalf.

Consideration of rival submissions

The  issue  with  respect  to  maintainability  of  the  Standard  Rent  Application and the question of conflict with the provisions of the  Public Premises Act-

58. As  we  have  noted  earlier,  the  question  for  our  considerations  is  

whether  the  application  of  the  appellant  for  fixation  of  standard  rent  was  

maintainable under the MRC Act, notwithstanding the fact that the premises of the  

appellant were otherwise covered under the Public Premises Act for the purposes of  

that Act.  Again, as we have noted earlier, the appellants do not dispute that for the  

purposes of eviction of unauthorised occupants, and for the recovery of arrears of  

rent from them, the proceedings to be initiated by the respondents would be fully  

competent  under  the  Public  Premises  Act,  and  that  in  such  an  eventuality  the  

occupants will not be entitled to seek any remedy under the MRC Act, since the  

jurisdiction  of  the  Civil  Court  has  been  ousted under  Section  15  of  the  Public  

Premises Act in this behalf.  It is also already held by this Court in the cases of  

Kaiser-I-Hind and Crawford Bayley (supra) that as far as the issue of eviction of  

unauthorised occupants from Public Premises is concerned, the authorities under the  

Public  Premises  Act  alone  will  have  jurisdiction  to  deal  therewith,  and  no  

proceedings will lie either under the Bombay Rent Act or the MRC Act.  The question  

in the present matter is with respect to the maintainability of the Standard Rent  

57

Application by the occupants of these premises under the MRC Act.  Mr. Hansaria,  

learned counsel for the appellants points out that this issue has not been decided by  

this Court so far.   

59. Before we deal with the rival submissions, we may state once again  

that  under  the  general  law  of  landlord  and  tenant  also,  the  landlord  had  the  

obligation to charge only the rent agreed under the lease agreement, and to carry  

out the repairs to the property which were necessary, failing which the tenant would  

be entitled to carry  out  the same and deduct  the expenses from the rent  [see  

Section 108 (B) (f) of the Transfer of Property Act].  As we have noted earlier, due  

to the problems of the scarcity of accommodation following the Second World War,  

special protection was made available to the tenants against unjustified increases in  

rent  and  ejectment  from  the  tenancies.   This  protection  was  reflected  in  the  

provisions of various Rent Control Acts such as the Bombay Rent Act, 1947 which  

governed the premises of the appellant for all  purposes prior to the coming into  

force of the Public Premises Act, 1971.  When the Public Premises Act was enforced,  

it covered the subject of eviction of unauthorised occupants of the public premises  

and recovery of arrears of rent from them, and those subjects no longer remained  

covered under  the Bombay Rent  Act.  The question is  whether  the remedies for  

fixation  of  Standard  Rent  and  getting  the  essential  services  restored  when  

necessary, no longer remained available to the tenants like the appellant merely  

because the Public Premises Act came to be applied.  And secondly, after the MRC  

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Act came into force from 31st March, 2000 whether these remedies once again came  

to be reinforced.

60. We have noted the observations  from the leading judgment  of  the  

Constitution Bench in Ashoka Marketing.  In that matter this Court was concerned  

with the question as to whether the proceedings for eviction initiated under the  

Public Premises Act were maintainable or whether they had to be taken under the  

Delhi Rent Control Act, 1958.  As we have noted earlier this Court has held that  

since both the acts were concerning entries no. 6, 7 and 13 of the Concurrent List,  

and  since  the  Public  Premises  Act  was  a  subsequent  Act,  and  governing  the  

particular subject, the same will override, and the eviction proceedings thereunder  

were valid and competent.

61. The question in this case is different in the sense that the MRC Act  

which is a State Act, is an Act subsequent to the Public Premises Act, and has been  

assented by the President, notwithstanding the existence of the Public Premises Act.  

The situation, therefore, would be governed by Sub-article (2) of Article 254 of the  

Constitution,  and  we  will  have  to  see  whether  the  provisions  of  MRC Act  with  

respect to the fixing of the standard rent and restoring the essential supplies and  

services are in any way repugnant to the Public Premises Act.  In  Vijay Kumar  

Sharma Vs. State of Karnataka (supra) a Bench of three Judges of this Court has  

laid down that whenever repugnancy is alleged,  what has to be first examined is  

whether the two legislations cover or relate to the same subject matter. The test for  

that is to find out the dominant intention of the two legislations.  If the subject  

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matters covered by the legislations are different, merely because the two legislations  

refer to some allied or cognate subjects they do not cover the same field.

62. We have noted the observations of a Bench of three Judges of this  

Court in  M/s Jain Ink Mfg. Co.  (supra) that the Public Premises Act has a very  

limited application, whereas the Rent Act is an Act with much wider application than  

the Public Premises Act.  In the present case, the subjects of fixation of Standard  

Rent and restoration of essential  services by the landlord are covered under the  

MRC Act, but in no way under the Public Premises Act.  The Public Premises Act, in  

fact does not claim to cover these subjects. As held by the Constitution Bench in  

Kesoram Industries Ltd. (supra), the Court has to look at the substance of the  

matter.  Regard must be had to the enactment as a whole, to its main objects and  

scope  of  its  provisions.   Incidental  and  superficial  encroachments  are  to  be  

disregarded.  Eviction and recovery of arrears of rent are alone covered under the  

Public Premises Act.  The subject of fixation of rent is different and independent  

from eviction as held by the division bench of the Karnataka High in Bharath Gold  

Mines.  That being the position, there is no conflict between the MRC Act and the  

Public Premises Act when it comes to the provisions in the MRC Act with respect to  

fixation  of  Standard  Rent  and  requiring  the  landlord  to  maintain  the  essential  

services and supplies. Therefore, the provisions of MRC Act in that behalf cannot in  

any way be said to be repugnant to those under the Public  Premises Act.   The  

presumption is in favour of constitutionality, and the Court is not expected to strike  

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down a provision unless the conflict is a real one.  In the present matter there is no  

such real conflict.

On ouster of the jurisdiction of the Civil Courts-

63. We may next deal  with the contention of  the respondents that  the  

exclusionary clauses are to be read strictly.  In the case of Church of North India  

(supra), relied upon by the respondents, this Court was concerned with a suit for  

declaration as to the succession to a particular trust governed under the Bombay  

Public Trust Act.   Such a suit was squarely covered under that Act and, therefore, it  

was held that the Civil Court will not have the jurisdiction to entertain the suit.  The  

seven principles laid down by the Constitution Bench in Dhulabhai Vs. State of M.P.  

(supra)  were relied  upon in  that  case.   It  is  sufficient  to  refer  to  the first  two  

principles therefrom which are as follows:-  

“(1) Where the statute gives a finality to the orders of  the   special  Tribunals  the  civil  courts'  jurisdiction  must  be  held  to  be  excluded if there is adequate remedy to do what the civil courts would   normally do in a suit. Such provision, however, does not exclude those  cases  where  the  provisions  of  the  particular  Act  have  not  been   complied with or the statutory Tribunal has not acted in conformity  with the fundamental principles of judicial procedure.

(2)  Where  there  is  an express  bar  of  the  jurisdiction  of  the  court, an examination of the scheme of the particular Act to find the  adequacy or the sufficiency of the remedies provided may be relevant   but is not decisive to sustain the jurisdiction of the civil court.”

If we apply these two tests and examine the scheme of the Public Premises Act, it  

will be seen that section 10 of the Act does give a finality to the orders passed by  

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the Estate Officers or the Appellate Officers, and states that ‘the same shall not be  

called in question in any original suit, application or execution proceeding, and no  

injunction shall be granted by any court or other authority in respect of any action  

taken or to be taken in pursuance of any power conferred by or under this Act’.  

Section  15  of  the  Act  specifically  states  that  no  court  shall  have  jurisdiction  to  

entertain  any  suit  or  proceeding  in  respect  of  the  subjects,  amongst  others  

concerning, ‘(a) the eviction of any person who is in unauthorised occupation of any  

public premises, and (d) the arrears of rent payable under sub-section (1) of section  

7 or damages payable under sub-section (2), or interest payable under sub-section  

(2A), of that section’. Therefore, to that extent the jurisdiction of the Civil Court is  

ousted.   The  actions  which  are  covered  under  the  Public  Premises  Act  are  

concerning eviction of unauthorised occupants and recovery of arrears of rent.  The  

Act however does not claim to speak anything about the fixation of Standard Rent or  

maintenance of essential services.  For these purposes no remedy is provided under  

the Public  Premises  Act.   Therefore,  the jurisdiction  of  the Civil  Court  for  these  

remedies cannot be held to be ousted.

64. It was submitted on behalf of the respondent that if the submission of  

the appellant is accepted it will mean permitting proceedings before the Court of  

Estate Officer for recovery of arrears of rent, and before the Rent Controller for  

fixation of standard rent, and the same is not desirable.  In our view, this by itself  

can be no reason to hold the Standard Rent  Application to be not maintainable  

before the Court of Small Causes.  We have referred to the judgment in the case of  

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National Engineering Industries Ltd. Vs.  Shri Kishan Bhageria (supra).  In  

that ease the establishment wherein the respondent/workman was employed was  

covered  under  the  Rajasthan  Shops  and  Establishment  Act,  1958.   It  was  also  

covered under the Industrial Disputes Act, 1947.  Dismissal of his application for  

reinstatement under Section 28A of the Rajasthan Act on the ground of limitation  

was held as not preventing a reference under Section 10 of the Industrial Disputes  

Act.  The observation of this Court at the end of para 12 of that judgment is relevant  

for our purposes, and which reads as follows:-  

“12………It appears to us that it cannot be said that these two  Acts do not tread the same field. Both these Acts deal with the rights   of the workman or employee to get redressal and damages in case of   dismissal or discharge, but there is no repugnancy because there is no  conflict between these two Acts, in pith and substance. There is no   inconsistency between these two Acts. These two Acts, in our opinion,   are supplemental to each other.”

65. Same is the position with respect to the Labour Laws in various States.  

Thus, for example, where an industry is covered under a State Act such as the  

Bombay Industrial Relation Act, 1946 in Maharashtra, the workmen engaged therein  

will be required to raise the disputes concerning reinstatement and backwages in  

the event of dismissal, retrenchment, removal or termination before the authority  

under that Act. At the same time, whenever any money, including unpaid wages is  

due to the workmen, they also have the right to file the claim applications under  

section  33  C  (2)  of  the  Industrial  Disputes  Act,  1947,  in  the  Labour  Courts  

constituted  under  that  Act,  since  similar  provision  is  not  made  under  the  said  

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Bombay Act.  The MRC Act being a welfare statute like the labour laws is enacted  

after considering the requirements of the tenants, and contains the provisions for  

fixation  of  standard  rent  and for  restoring  essential  services  and supplies  when  

necessary.  The public premises are not specifically exempted from the applicability  

of the MRC Act.  That being so, there is no reason to hold that these remedies will  

not be available to the tenants of the public premises, though for the purposes of  

eviction of unauthorised occupants and recovery of arrears of rent, the proceedings  

will  lie  only  under  the  Public  Premises  Act.   It  is  also  to  be  noted  that  the  

proceedings  for  the recovery of  arrears  of  rent  are at  the instance of  landlord,  

whereas those for fixation of standard rent are at the instance of the tenant.  Both  

these proceedings are quite different in their prayers and scope of consideration.  

The fact that the proceeding for one purpose is provided under one statute can not  

lead to an automatic conclusion that the remedy for a different purpose provided  

under another competent statute becomes unavailable.

Expectations from Public Bodies -

66. Although  the  question  of  maintainability  of  the  Standard  Rent  

Applications concerning the public premises is only coming up now before this Court,  

we have referred to the views of Courts when different facets of this issue came up  

for consideration from time to time.  The exemption from the Bombay Rent Act to  

the government premises was upheld in Rampratap Jaidayal (supra), on the basis  

of the presumption in favour of the constitutionality of the enactment which was  

also  on  the  footing  that  Legislature  correctly  appreciates  the  needs  of  its  own  

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people.  Chief Justice Chagla has clearly observed in that matter that the Legislature  

was not in any sense exempting the Government from the operation of the Act in  

order to permit the Government to do the very thing which the Legislature was  

prohibiting the landlords from doing,  viz.  not to increase rents and not to eject  

tenants unless it was absolutely necessary in the public interest.  S.R. Das, J. (as he  

then was) has also observed similarly in Baburao Shantaram More (supra) that it  

was not expected that the Government or the Local Authority would be actuated by  

any profit making motive so as to unduly enhance the rents or eject the tenants  

from  their  respective  properties  as  private  landlords  are  or  are  likely  to  be.  

Sabyasachi Mukharji, J (as he then was) has gone further in Dwarkadas Marfatia  

(supra),  and  observed  that  when  public  authorities  enjoy  this  benefit  of  being  

hidebound by the requirements of the Rent Act, they must act for public benefit,  

and to that extent this issue is liable to be gone into and can be the subject-matter  

of  adjudication.   He  has  stated  in  no  uncertain  terms  that  the  legislative  

expectations  as  observed  by  the  Chagla,  C.J.  in  Rampratap  Jaidayal (supra)  

cannot make such conduct a matter of contract pure and simple.  He has further  

observed that the exercise of discretion of public authorities must be tested on the  

assumption that they would not act as private landlords and they must be judged by  

that standard.  We may however, add that these principles will have no relevance  

while considering a dispute between a statutory body as landlord and an affluent  

tenant in regard to a commercial or non-residential premises.

On the relevance of the Guidelines -  

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67. In the instant case, the activities of the respondent/L.I.C are controlled  

by the LIC Act.  Section 21 of the LIC Act lays down that the Corporation shall be  

guided by the directions issued by the Central Government.  This Section reads as  

follows:-  

“21. Corporation  to  be  guided  by  the  directions  of  Central Government- In the discharge of its functions under this Act,  the Corporation   shall  be guided by such directions in matters of policy involving  public interest as the Central Government may give to it in writing;   and if any question arises whether a direction relates to a matter of  policy  involving  public  interest  the  decision  of  the  Central   Government thereon shall be final.”

The guidelines dated 30.5.2002 are not directions under section 21 of the LIC Act.

68. We have referred to the general guidelines dated 30.5.2002, laid down  

by the Central Government in this behalf.  Guidelines no. 2(i) and 2 (iii) are relevant  

for our purpose.  Guideline no. 2 (i) states that the provisions of the Public Premises  

Act, 1971 should be used primarily to evict totally unauthorised occupants. Guideline  

No. 2 (iii)  specifically states that it will be open to the public  authority to secure  

periodic revision of rent in terms of the provisions of the Rent Control Act in each  

State, or to move under genuine grounds under the Rent Control Act for resuming  

possession.  Thus, these guidelines specifically recognise the relevance of certain  

provisions of Rent Control Acts for their application to the properties covered under  

the Public Premises Act.  It is stated in the guidelines that the public authorities  

would have rights similar to private landlords under the Rent Control Acts in dealing  

with  genuine  legal  tenants.   It  follows  that  the  public  authorities  will  have  the  

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obligations of the private landlords also.  It is relevant to note that the purpose of  

these guidelines is to prevent arbitrary use of powers under the Public Premises Act.  

The relevance of the guidelines will depend upon the nature of guidelines and the  

source of  power to issue such guidelines.   The source of  the right  to apply  for  

determination of standard rent is the Rent Control Act, and not the guidelines.

69. We may also note by subsequent clarificatory order dated 23.7.2003,  

the Central Government has made it clear that the guidelines dated 30.5.2002 will  

not apply to affluent tenants:

“The  Government  resolution  dated  30.5.2002  embodies  the  guidelines  dated  14.1.1992  for  observance  by  the  public  sector   undertakings.  However, clarification was issued vide OM No. 21011/790   Pol-I IV H. 11 dated 7.7.1993 that the guidelines are meant for genuine   non-affluent tenants and these are not applicable to the large business   houses and commercial entrepreneurs.”

70. It was submitted on behalf of the respondents that if the appellant or  

the tenants are aggrieved by the fixation of the rent, their remedy is to invoke the  

writ jurisdiction of the High Court.  In making this submission, the respondents are  

ignoring that the writ jurisdiction is a discretionary jurisdiction.  Besides, normally  

oral evidence is not recorded while exercising the writ jurisdiction.   Although part of  

the evidence to be examined in the process of rent fixation would be documentary,  

such as the provisions of the contract between the parties, there would also be  

many other factors which may require oral evidence, particularly with respect to the  

comparable properties. An appropriate remedy, forum and procedure are therefore  

necessary in the interest of fairness and proper adjudication.  That apart, there is no  

reason to insist upon such an interpretation which will deny to the tenants of the  

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public premises, a remedy and a forum which are otherwise available to the tenants  

under the MRC Act,.  

71. In view of what is stated above, the interpretation as canvassed by the  

respondents will deny the appropriate remedy to the petitioner and the like tenants,  

to have the rent of their premises being fixed by filing a Standard Rent Application,  

and also to get the essential services restored in the event of any difficulty.  There is  

no reason to accept any such interpretation because as stated above there is no  

conflict between this provisions of the MRC Act with those under the Public Premises  

Act, when it comes to fixation of standard rent and restoring the essential supplies.  

Otherwise  it  will  expose  the  provisions  of  Public  Premises  Act  to  the  vires  of  

unreasonableness also. The interpretation canvassed by the respondents is not in  

consonance  with  the  welfare  state  that  is  contemplated  under  the  Indian  

Constitution.   Accordingly,  we hold  that  the impugned judgment  of  the learned  

Single Judge of Bombay High Court does not lay down the correct position in law.  

As against that we approve the approach and the interpretation adopted by the  

Karnataka High Court in Bharath Gold Mines Ltd. (supra).

72. In the circumstances, we hold as follows:-

(a)  The provisions of the Maharastra Rent Control Act, 1999 with respect  

to fixation of Standard Rent for premises, and requiring the landlord not to cut off or  

withhold essential supply or service, and to restore the same when necessary, are  

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not in conflict with or repugnant to any of the provisions of the Public Premises  

(Eviction of Unauthorised Occupants) Act, 1971.

(b) The  provisions  of  the  Public  Premises  Act,  1971  shall  govern  the  

relationship  between  the  public  undertakings  covered  under  the  Act  and  their  

occupants to the extent they provide for eviction of unauthorised occupants from  

public  premises,  recovery  of  arrears  of  rent  or  damages  for  such  unauthorised  

occupation, and other incidental matters specified under the Act.

(c) The provisions of the Maharashtra Rent Control Act, 1999 shall govern  

the relationship between the public undertakings and their occupants to the extent  

this  Act  covers  the  other  aspects  of  the  relationship  between  the  landlord  and  

tenants, not covered under the Public Premises Act, 1971.

(d) The application of appellant and similar applications of the tenants for  

fixation of Standard Rent or for restoration of essential supplies and services when  

necessary, shall be maintainable under the Maharashtra Rent Control Act, 1999.

73. Hence, we pass the following order-  

(a) This appeal is allowed, and the order dated 8.9.2009 passed by the learned  

Single Judge of Bombay High Court, in Writ  Petition No. 5023/2009 filed by the  

respondents is set aside.  The said Writ Petition shall stand dismissed.  

(b) The order dated 30.3.2009 passed by the Court of Small  Causes, Mumbai  

rejecting  respondents’  application  objecting  to  the  maintainability  of  appellant’s  

Application  No.RAN24/SR/08  for  fixation  of  Standard  Rent  is  upheld.   The  said  

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Standard  Rent  Application  will  now be  heard  and  decided  on  its  merits  and  in  

accordance with law.

(c) In the facts of this case, there will be no order as to costs.

…………..……………………..J.  ( R.V. Raveendran )   

 …………………………………..J.  ( H.L. Gokhale  )

New Delhi

Dated :  September 19, 2011

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