TMI Blog2003 (2) TMI 482X X X X Extracts X X X X X X X X Extracts X X X X ..... s in occupation of premises requisitioned by the State Government. Several Writ Petitions were filed which were all disposed of by the impugned judgment of the Division Bench. The principal question which arises for decision in the batch of appeals is the constitutional validity of Amendment Act No. XVI of 1997 abovesaid. (hereinafter referred to as the Amendment Act, for short). Historical background : Two decisions of this Court :- A brief statement of historical background leading to the present controversy is apposite. In the year 1948, Bombay Land Requisition Act, 1948 (Act No. XXXIII of 1948) was enacted to make provision for the requisition of land and for the continuance of requisition of land and for certain other purposes. 'Land' was widely defined so as to include therein building also and 'premises' were defined to mean building or part of building intended to be let separately and other things appurtenant (as defined). Land and vacant premises could be requisitioned by the State Government for any public purpose. Provision was also made for continuance of requisitions made under the Requisitioned Land (Continuance of Powers) Act, 1947 and the Defe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther Government would be requisitioning the premises when really speaking they want the premises for acquisition as the objective of taking the premises was not transitory but permanent in character. This Court upheld the decision of the High Court allowing the Writ Petition and directing the State Government to derequisition the flat and to take steps to evict the appellant and to handover possession of the flat to the owner. Following the decision of the Bombay High Court in H.D. Vora's case (supra) the Bombay High Court in numerous cases struck down the continuance of requisition orders made in the late 1940s and early 1950s particularly of residential premises. Two Writ Petitions, relating to premises requisitioned under Bombay Land Requisition Act, 1948 __ one of which was requisitioned for purposes of residential use and the other was requisitioned for commercial use of running fair price ration shop by a co-operative society, came to be filed in this Court which were heard and decided on April 27, 1994 by the decision reported as Grahak Sanstha Manch and Ors. Vs. The State of Maharashtra, (1994) 4 SCC 192. The Writ Petitions in effect had sought reconsideration of dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Writ Petition No. 404 of 1986. Having regard to the known difficulty of finding alternate accommodation in Bombay and other large cities in Maharashtra, the protection of these interim orders is hereby continued until 30-11-1994, on which date all occupants of premises the continued requisition of which has been quashed as aforesaid shall be bound to vacate and hand over vacant possession to the State Government so that the State Government may, on or before 31-12-1994, derequisition such premises and hand back vacant possession thereof to the landlords. The writ petitions are, accordingly, dismissed. There shall be no order as to costs. [N.B. : The portion which we have underlined to emphasise will be of significance in constructing the operative part of our judgment.] The majority opinion endorsed by four out of five Judges constituting the Constitution Bench was delivered by S.P. Bharucha, J. (as his Lordship then was) which we have noticed and reproduced hereinabove. P.B. Sawant, J. in his separate opinion agreed with the findings on the questions of law recorded in the majority opinion but expressed dissent with the operative part of the order. His Lordship observed: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n requisitioned premises continuing in occupation by virtue of interim orders of the Court which stood vacated by dismissal of the writ petitions, this Court allowed time until 30-11-1994 for vacating the premises by the occupants and for restoring of possession of the premises by the State Government to the owners. Rent Control Legislations leading upto the impugned amendment :- Now the relevant Rent Control Legislations in their chronological order leading upto the enactment of the impugned Amendment Act held ultra vires by the impugned judgment of the High Court, may be noticed. The Bombay Land Requisition Act, 1948 as originally enacted was to remain in force upto 31-3-1950. The Act was amended from time to time extending its life. Section 9 of the Act empowered the State Government to release from requisition at any time the land requisitioned or continued to be subject to requisition under the Act. By Section 2 of Maharashtra Act 51 of 1973, sub-Section (1A) was inserted below sub-Section (1) of Section 9 which made it obligatory for the State Government to release land from requisition on the expiry of the stated period. The said period was extended from time to time b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as likely to be faced by several persons in occupation of the accommodation requisitioned and allotted by the State Government and the difficulties which the Government was facing on account of paucity of funds and ever rising prices in constructing alternative accommodation to accommodate Government employees in-service and others. The statement noticed the factum of both Houses of the State Legislature being not in session and the Governor of Maharashtra having felt satisfied of the existence of requisite circumstances for issuing the Ordinance and concluded by stating :- In the facts and circumstances as aforesaid, it is considered expedient to extend the period of requisition under the Act for a further period of three years beyond the 26th December, 1994, so as to enable the State Government to complete the process of derequisitioning during the extended period of three years. It is, therefore, proposed to suitably amend sub-Section (1A) of Section 9 of the principal Act extending the total period of requisition from twenty-one years to twenty-four years. The Ordinance was replaced by Maharashtra Act No. VII of 1995. The assent of the President of India under Article 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... premises requisitioned and continued under requisition and allotted by the State Government for any non-residential purpose to any department or office of the State Government or Central Government or any public sector undertaking or Corporation owned or controlled fully or partly by the State Government or any registered co-operative society or any foreign consulate and allowed by the State Government to remain in their occupation or possession were included in the definition of 'Government Premises' within the meaning of Section 2 clause (b) of the Bombay Government Premises Eviction Act, 1955. (4) In spite of such status of tenant having been conferred on the person in occupation or possession and the owner of the property having been declared to be landlord, the Ordinance took care to clarify (by sub-section (2) of Section 3) :- Save as otherwise provided in this section or any other provisions of this Act, nothing in this Section shall affect:- (a) the rights of the landlord including his right to recover possession of the premises from such tenant on any of the grounds mentioned in Section 13 or in any other Section; (b) the right of the landlord or s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 997 and those which have been requisitioned after 27th December, 1973, within twenty-four years from the date on which possession of such land was surrendered or delivered to, or taken by, the State Government. Further the Supreme Court in Writ Petition No. 404 of1986 filed by the Association of Allottees of the Requisitioned Premises and Writ Petitions No. 53 of 1993 and 27 of 1994 filed by the Grahak Sanstha Versus State of Maharashtra, has given a final decision on the 27th April, 1994 in the matter of requisitioned premises (AIR 1994, S.C., 2319), upholding the decision in the H.D. Vora's case [(1984) 2 S.C.C. 337] and has directed that the occupants of the requisitioned premises, the continued requisition of which was quashed, were bound to vacate and hand over vacant possession of such premises to the State Government on or before 30th November, 1994 so that the Government could derequisition such premises and hand over the vacant possession thereof to the landlords. Accordingly, derequisitioning process, in respect of all such premises and applying the ratio of the said Supreme Court Judgment, in several other premises, has already been completed by the State Government. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... take immediate action further to amend the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947, the Bombay Land Requisition Act, 1948 and the Bombay Government Premises (Eviction) Act, 1955, suitably for the purposes aforesaid, this Ordinance is promulgated. Mumbai: P.C. ALEXANDER Dated the 7th December 1996. Governor of Maharashtra By order and in the name of the Governor of Maharashtra, JAYANT DESHPANDE, Secretary to Government. In due course of time, the Ordinance was replaced by the Bombay Rents, Hotel, Lodging House Rates Control, Bombay Land Requisition and Bombay Government Premises (Eviction) (Amendment) Act, 1996 (Maharashtra Act XVI of 1997). The vires of this Amendment Act XVI of 1997 is under challenge and arises for consideration by this Court in these appeals, in view of the High Court having upheld the challenge. The vires of the Ordinance need not be gone into as the same has lapsed with the passage of time and its provisions merged into the provisions of the Amendment Act above-said. Though the challenge before the High Court was laid on very many grounds, in view of the findings arrived at by the High Court all the learned counsel for the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icultural property are not included in Entry 18 of List-II and that they more appropriately fall within the field of entries 6, 7 and 13 of List-III. What should be the approach of the Court dealing with a challenge to the constitutionality of a legislation has been succinctly set out in Principles of Statutory Interpretation by Justice G.P. Singh (Eighth Edition, 2001 at pp 453-454 and 36). A statute is construed so as to make it effective and operative on the principle expressed in the maxim ut res megis valeat quam pereat . (It is better to validate a thing than to invalidate it). There is a presumption that the Legislature does not exceed its jurisdiction. The burden of establishing that the Act is not within the competence of the Legislature, or that it has transgressed other constitutional mandates, such as those relating to fundamental rights, is always on the person who challenges its vires. If a case of violation of a constitutional provision is made out then the State must justify that the law can still be protected under a saving provision. The courts strongly lean against reducing a statute to a futility. As far as possible, the courts shall act to make a legislatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h will result in any of the entries being rendered futile or otiose must be avoided. That interpretation has invariably been countenanced by the constitutional jurists, which gives the words used in every entry the widest possible amplitude. Each general word employed in the entries has been held to carry an extended meaning so as to comprehend all ancillary and subsidiary matters within the meaning of the entry so long as it can be fairly accommodated subject to an overall limitation that the courts cannot extend the field of an entry to such an extent as to result in inclusion of such matters as the framers of the Constitution never intended to be included within the scope of the entry or so as to transgress into the field of another entry placed in another List. In every case where the legislative competence of a Legislature in regard to a particular enactment is challenged with reference to the entries in the various Lists, it is necessary to examine the pith and substance of the Act and to find out if the matter comes substantially within an item in the List. The express words employed in an entry would necessarily include incidental and ancillary matters so as to make the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ropriate interpretation on the entries. The Constitution has the greatest claim to live. The claim ought not to be throttled. Directive Principles of State Policy can serve as potent and useful guide for resolving the doubts and upholding constitutional validity of any legislation if doubted. In United Provinces Vs. Mt. Atiqa Begum and Others, AIR 1941 FC 16, their Lordships upheld the principle that the question whether any impugned Act is within any of the three Lists, or in none at all, is to be answered by considering the Act as a whole and deciding whether in pith and substance the Act is with respect to particular categories or not and held that in doing so the relevant factors are: (i) the design and the purport of the act, both as disclosed by its language, and (iii) the effect which it would have in its actual operation. Article 37 provides that the Directive Principles of State Policy though not enforceable by any court, yet the principles laid down therein are fundamental in the governance of the country and the State is obliged to apply these principles in making laws. Article 38 inspires the State to strive to promote the welfare of the people by securing and pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ircumscribed by the exclusive power of Parliament to legislate on the same subject under entry 3 of List-I. Before the Constitution Bench in Indu Bhushan Bose's case (supra) the English decisions in Prout Vs. Hunter, (1924) 2 KB 736, Property Holding Co. Ltd. Vs. Clark, (1948) 1 KB 630 and Curl Vs. Angale Anr., (1948) 2 All England Reports 189 were cited with approval. In Prout Vs. Hunter (supra), Rent Restrictions Act was held to have been passed by the Parliament with the twofold object - (i) of preventing the rent from being raised above the pre-war standard, and (ii) of preventing tenants from being turned out of their houses even if the term for which they had originally taken them had expired. In Property Holding Co. Ltd. Vs. Clark (supra), the objects of policy underlying rent restriction legislations were stated to be (i) to protect the tenant from eviction from the house where he is living, except for defined reasons and on defined conditions; (ii) to protect him from having to pay more than a fair rent. The latter object is achieved by the provisions for standard rent with (a) only permitted increases, (b) the provisions about furniture and attendance, and (c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocedure by which the landlords were entitled to snap the relationship of landlord and tenant deemingly created by the statute and seek eviction subject to making out a ground therefor under the pre-existing Rent Control Legislation. Such legislation would clearly fall within the purview of entries 6, 7 13 of List-III. There is yet another angle of looking at the issue. In Lingappa Pochanna Appealwar Vs. State of Maharashtra Anr., (1985) 1 SCC 479, the provisions of Maharashtra Restoration of Lands to Scheduled Tribes Act, 1975 came up for consideration which Act related to transfers and alienation of agricultural lands by members of Scheduled Tribes in the State to persons not belonging to Scheduled Tribes. The legislation fell in entry 18 in List-II. Certain provisions of the Act trenched upon the existing law, namely, the Transfer of Property Act and the Specific Relief Act, both made by Parliament. It was held that the power of the State Legislature to make a law with respect to transfer and alienation of agricultural land carries with it not only a power to make a law placing restrictions on transfers and alienations of such lands including a prohibition thereof, but als ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the State Legislation aimed at equitable distribution of landed property resulting in partial deprivation of proprietary rights can also be rested under entry No. 20 of List-III which is economic and social planning . A grim and emergent situation was created on account of threat posed before the likely evictees who were in occupation of requisitioned premises. The impugned Amending Act also seeks to bring into effect a scheme of equitable redistribution of wealth and shelter so as to protect the licensee __ occupants by giving them the status of tenant and regulating the right to eviction exercisable by the landlords by making it conditional upon availability of grounds under a pre-existing rent control law already governing similar properties in the State of Bombay. The salutary goal of 'from each according to his capacity, to each according to his needs' was sought to be achieved. The essential need of shelter for other segments of society such as the State Administration, Semi-Government bodies, PSUs and the likes was also protected in public interest as otherwise their activities would have been jeopardized, which in turn would have had an adverse effect on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssing a statute which purports to act within the limits of its powers, yet in substance and in reality it transgresses those powers, the transgression being veiled by what appears, on proper examination, to be a mere pretence or disguise. The discerning test is to find out the substance of the Act and not merely the form or outward appearance. If the subject matter in substance is something which is beyond the legislative power, the form in which the law is clothed would not save it from condemnation. The constitutional prohibitions cannot be allowed to be violated by employing indirect methods. To test the true nature and character of the challenged legislation, the investigation by the Court should be directed towards examining (i) the effect of the legislation and (ii) its object, purpose or design. While doing so, the Court cannot enter into investigating the motives, which induced the Legislature to exercise its power. The abovesaid view was reiterated by Larger Bench (Seven Judges) in R.S. Joshi, S.T.O. Vs. Ajit Mills Ltd., (1977) 4 SCC 98, 108 and by Constitution Bench in Naga People's Movement of Human Rights Vs. Union of India, (1998) 2 SCC 109, 137. In K.C. Gaja ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... retation of the law under which tax was collected and by legislative fiat makes the new meaning binding upon courts. The Legislature may follow any one method or all of them and while it does so it may neutralise the effect of the earlier decision of the court which becomes ineffective after the change of the law. Whichever method is adopted it must be within the competence of the Legislature and legal and adequate to attain the object of validation. If the Legislature has the power over the subject-matter and competence to make a valid law, it can at any time make such a valid law and make it retrospectively so as to bind even past transactions. The validity of a Validating Law, therefore, depends upon whether the Legislature possesses the competence which it claims over the subject-matter and whether in making the validation it removes the defect which the courts had found in the existing law and makes adequate provisions in the Validating Law for a valid imposition of the tax. (emphasis supplied) Thus, it is permissible for the Legislature, subject to its legislative competence otherwise, to enact a law which will withdraw or fundamentally alter the very basis on which a ju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... validate the law; (c) whether such validation is consistent with the rights guaranteed in Part III of the Constitution; (iv) the court does not have the power to validate an invalid law or to legalise impost of tax illegally made and collected or to remove the norm of invalidation or provide a remedy. These are not judicial functions but the exclusive province of the Legislature. Therefore, they are not encroachment on judicial power; (v) in exercising legislative power, the Legislature by mere declaration, without anything more, cannot directly overrule, revise or override a judicial decision. It can render judicial decision ineffective by enacting valid law on the topic within its legislative field fundamentally altering or changing its character retrospectively. The changed or altered conditions are such that the previous decision would not have been rendered by the court, if those conditions had existed at the time of declaring the law as invalid............. It is competent for the Legislature to enact the law with retrospective effect; (vi) the consistent thread that runs through all the decisions of this Court is that the Legislature cannot directly overrule t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tinue in occupation of the property and makes himself liable to be evicted on fulfillment of those conditions. Once the liability to be evicted is incurred by the tenant under the State Rent Legislation, he cannot turn around and say that the contractual lease has not been determined under the provisions of the Transfer of Property Act and, therefore, he is not liable to be evicted. Various State Rent Control Acts make a serious encroachment in the field of freedom of contract. The landlord is not permitted to snap his relationship with the tenant merely by his act of serving a notice to quit on the tenant. In spite of the notice, the Rent Control Law says that the tenant continues to be tenant enjoying all the rights of a lessee but at the same time deemed to be under all the liabilities such as payment of rent etc. in accordance with the law. Various Rent Acts confer immunity on tenants from eviction whether in execution of a decree or otherwise except in accordance with the provisions of the Act and/or liability for eviction being incurred on one of the grounds provided for by the Act. Some Rent Control Acts provide that no landlord can treat the building to have become vacant b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the interim orders of the Court to remain in operation for some more period of time in spite of the cases having been disposed of. Allowing time to vacate the premises under the protection of the interim orders is not the same thing as issuing mandamus to vacate the premises by certain date. What the impugned Amending Act has done is to fundamentally alter the very basis of occupation of the premises by the occupants. Instead of their remaining in occupation by virtue of orders of allotment of requisitioned premises, the Amending Act declared that the requisitioning shall come to an end and the occupants shall become tenants under the owners who would become the landlords and the amount of compensation shall become rent. The privity of estate was converted into privity of contract. The foundation for pre-existing transfer of property underwent a fundamental change. The separate concurring opinion recorded by P.B. Sawant, J. in Grahak Sanstha Manch and Ors. case (supra) records that the landlords were receiving the same rent from the allottees as from the other tenants (i.e. non-allottees). The effect of allowing more time to vacate the premises in spite of the requisitioning h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the judgment. The writ petitioners cannot make any capital out of the fact that two decisions have been referred to in the Statement of Objects and Reasons. On the contrary, what is relevant in the State of Objects and Reasons is the factual statement to the following effect (i) that the State Government has honoured the decisions of this Court and commenced derequisitioning process and taken a policy decision not to continue with such requisitionings for future, except in some special cases; (ii) that in spite of the said process having been commenced there were 604 residential premises, above 90 non-residential premises still under requisition in Greater Bombay and 138 in other districts of the State of Bombay, most of them occupied by Government servants and departments, the eviction whereof would have imperatively resulted into creation of a grave situation much to the detriment of public interest; (iii) that the landlords were rushing to the High Court seeking mass evictions from the premises under requisition; (iv) that the likely evictees need to be protected from imminent eviction solely on ground of requisitioning coming to an end, unless and until liability for evicti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ticle 14 of the Constitution. However, the history of precedents shows that, by and large, such challenges have failed as often as laid. It is the angle with which the issue is approached that makes the difference. The Legislatures showing pro-activeness in the field have been motivated not with the idea of destroying or jeopardizing the property rights of the landlords but rather with the benevolent desire of extending the protective umbrella of legislation to the tenants so as to save them from unscrupulous evictions and rack-renting mentality of greed which clings to the owning of the property, and, for achieving the avowed object of striking a judicious balance of equity between two sections of the society, i.e. the landlords, generally called haves, and tenants, generally called have nots, so far as the urban property is concerned. The courts while upholding the constitutionality of such legislations have referred to the statements of objects and reasons and the preambles for the purpose of finding out the conditions prevailing at the time when the bills were sponsored and the evils which were prevailing and which were sought to be remedied. Whenever the courts have felt doubt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the class, and (ii) such differential must have a rational relation with the object sought to be achieved by the legislation. It is difficult to expect the Legislature carving out a classification which may be scientifically perfect or logically complete or which may satisfy the expectations of all concerned, still the court would respect the classification dictated by the wisdom of Legislature and shall interfere only on being convinced that the classification would result in pronounced inequality or palpable arbitrariness on the touchstone of Article 14. Bombay as a State and also as a cosmopolitan city__ unofficially crowned as commercial capital of the country, has its own peculiar problems. People from all over the country rush to Bombay in search of employment and opportunities. Not all are blessed enough to find shelter much less of their own. A huge administrative set up in the governance is needed involving a large number of personnel to manage the huge population accompanied by evergrowing influx of people. Accommodation is needed to house the people and activities including official ones catering to the needs of people. The premises were liberally requisitioned to sat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of requisitioned premises and the State Government, which protected the occupants in Bombay and other large cities in Maharashtra until 30.11.1994, and with effect from that date directed that all occupants of premises the continued requisition of which has been quashed shall be bound to vacate and hand over vacant possession to the State Government so that the State Government may on or before 31.12.1994 derequisition such premises and hand back vacant possession thereof to the landlords. The reversal of the impugned judgment of the High Court and upholding the validity of the impugned legislation shall not have the effect of undoing or overruling the abovesaid mandate of the Supreme Court contained in the decision of Grahak Sanstha Manch's case. Accordingly, all the appeals are allowed and the impugned judgment of the High Court is set aside subject to the clarification made hereinabove. It was stated at the Bar, during the course of hearing that the impugned judgment decided only the question of vires of the impugned Amending Act. Some of the writ petitions filed in the High Court raised the question of vires of the impugned Act as the sole issue for decision which ..... X X X X Extracts X X X X X X X X Extracts X X X X
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