1. Tenancy expired by efflux of time — Suit for possession filed — Subsequent notification extending rent control legislation to the area — Claim for protection under Section 12. (Para 2 )
Back
Next 
1961 Supreme(SC) 199
SUPREME COURT OF INDIA
21st April, 1961
S.K. DAS, J.L. KAPUR, M. HIDAYATULLAH, J.C. SHAH AND T.L. VENKATARAMA AYYAR, JJ.
Shah Bhojraj Kuverji Oil Mills and Ginning Factory, Appellants
Versus
Subhash Chandra Yograj Sinha, Respondent.
Civil Appeal No. 49 of 1961.
Advocates appeared
Mr. M. C. Setalvad, Attorney General for India, (M/s. Rameshwar Nath, S. N. Andley and P. L. Vohra, Advocates of M/s. Rajinder Narain & Co. with him), for Appellants; Mr. C. K. Daphtary, Solicitor-General of India, (M/s. Naushir Barucha and K. R. Chaudhuri, Advocates, with him), for Respondent.
Advocates:
C.K.DAFTARY, K.R.CHAUDHARY, M.C.SETALVAD, NAUSHIR BARUCHA, P.L.VOHRA, RAJINDAR NARAIN, RAMESHWAR NATH ROY, S.N.ANDLEY
C.K.DAFTARY, K.R.CHAUDHARY, M.C.SETALVAD, NAUSHIR BARUCHA, P.L.VOHRA, RAJINDAR NARAIN, RAMESHWAR NATH ROY, S.N.ANDLEY
Section 12(1) of the Bombay Rents Act, protecting tenants paying standard rent from eviction, is a rule of decision applicable to suits pending at the time the Act is extended to an area, as it governs the entitlement to a decree for possession.
Headnote:(A) Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 - Sections 12 and 50 - Recovery of possession - Protection of statutory tenants - Retrospective application of Section 12(1) - Provision stating that a landlord is not entitled to recovery of possession if the tenant pays or is ready and willing to pay standard rent and observes tenancy conditions - This constitutes a rule of decision that applies at the time the decree is passed, making it applicable to suits pending when the Act is extended to a particular area. (Paras 11, 13)
(B) Provisos and Saving Clauses - A proviso added to a section dealing with the effect of repeal often acts as a saving clause to safeguard rights that would otherwise be lost; such clauses are seldom used to construe the retrospective nature of substantive provisions of the Act. (Para 9)
Facts of the case:
A landlord filed a suit for possession after the expiry of a 15-year lease. During the pendency of the suit, a notification was issued extending the rent control legislation to the area where the property was situated. The tenants sought protection under the provision prohibiting eviction if rent is paid. The lower courts held that the protection was prospective and did not apply to pending suits.
Findings of Court:
The court found that while some sub-sections of the protection clause were prospective, sub-section (1) creates a rule of decision regarding the entitlement to possession. Since it prohibits the recovery of possession rather than the institution of a suit, it applies to suits pending at the time the Act's extension took effect.
Issues: Whether the protection against eviction under Section 12(1) of the Act applies retrospectively to suits pending at the time the Act was extended to the relevant area, and whether the saving clause in Section 50 mandated such application.
Ratio Decidendi: Section 12(1) is a rule of decision that determines whether a landlord is entitled to a decree for possession. Because the entitlement is assessed at the time the decree is passed, the provision applies to both pending and future suits, regardless of when the suit was instituted.
Result: Appeal allowed.
Legal Category Hierarchy
Table of Contents
2. Whether the proviso to Section 50 or Section 12(1) of the Rent Act applies retrospectively to suits pending at the time of the Act's extension. (Para 4 , 7 , 8 )
3. Section 12(1) is a rule of decision prohibiting recovery of possession if the tenant is willing to pay rent, applying to suits pending when the Act extends. (Para 11 , 12 , 13 )
4. A provision prohibiting the recovery of possession based on rent payment is a rule of decision applicable to suits pending at the time the legislation comes into force. (Para 12 , 13 )
5. Appeal allowed — Preliminary issues decided in favor of tenants — Suit to be decided in conformity with the judgment. (Para 14 )
6. Does Section 12(1) of the Bombay Rents, Hotel and Lodging House Rates Control Act apply to suits pending before the Act was extended to a specific area?
Yes. Section 12(1) is a rule of decision that prohibits a landlord from recovering possession if the tenant is willing to pay standard rent. It applies to suits pending when Part II comes into force, as it operates at the time the decree is passed. (Para 11 , 12 , 13 )
7. What is the legal nature of the proviso to Section 50 regarding the repeal of previous rent acts?
The proviso acts as a saving clause to safeguard rights and ensure pending suits are transferred and continued under the new Act, taking the matter out of the general application of the General Clauses Act. (Para 9 )
8. How does the application of Section 12(1) differ from Sections 12(2) and 12(3) of the Act?
While Sections 12(2) and 12(3) are prospective and apply to suits instituted after the Act's commencement, Section 12(1) is a rule of decision regarding the entitlement to possession, making it applicable to pending suits. (Para 12 , 13 )
Judgment
HIDAYATULLAH, J. : This is a tenants appeal, with the special leave of this Court, against an order of Naik, J., of the High Court of Bombay in Civil Revision Application No. 320 of 1959, by which he disallowed certain pleas raised by the appellants. The respondent is the landlord.
2. On September 11, 1942, the appellants had executed a rent note, under which they were in occupation of the premises in dispute. The period of the tenancy was 15 years, and it expired by efflux of time on March 14, 1957. The landlord thereupon filed a suit on April 25, 1957, for possession of the premises, in the court of the Joint Civil Judge (Junior Division), Erandol. Meanwhile, under S. 6 of the Bombay Rents. Hotel and Lodging House Rates Control Act, 1947, (to be called the Act, in this judgment), a notification was issued, applying Part II of the Act to the area where the property is situated. The appellants claimed protection of S. 12 in Part II of the Act, which deprived the landlord of the right of possession under certain circumstances. The Civil Judge framed three preliminary Issues, which were as follows:
"1. Whether this Court has jurisdiction to try the suit?
2. Whether the plaintiff s suit for possession of the suit property is maintainable in view of the Notification issued by the Government of Bombay on 16th August, 1958, applying Part II of the BOMBAY RENTS, HOTEL AND LODGING HOUSE RATES CONTROL ACT ? If not, what order should be passed?
3. What order?"
3. These Issues were decided against the appellants. They filed a revision petition before the High Court of Bombay, which was dismissed by the order under appeal. Naik, J., who heard the revision, followed a previous Full Bench ruling of the Bombay High Court reported in Nilkanth Ramchandra v. Rasiklal, 51 Bom LR 280. In that case, Chagla C. J. (Gajendragadkar and Tendolkar, JJ., concurring) had held that S. 12 of the Act was prospective and did not apply to pending cases. Reliance was also placed by Naik, J.. on the decision of this Court in Chandrasingh Manibhai v. Surjit Lal , 1951 SCR 221 where the opinion of the Full Bench of the Bombay High Court was approved.
4. Two questions have been raised in this appeal, and they are (1) whether by virtue of the first proviso to S. 50 of the Act. all the provisions of Part II including S. 12 were not expressly made applicable to all suits; and (2) whether by virtue of S. 12(1) of the Act, which applied independently by the extension of the Act to the area where the property is situate, the suit was not rendered incompetent and the landlord deprived of his remedy of possession.
5. Before we deal with these contentions, it is necessary to see some of the relevant provisions of this Act. The Act was not the first to be passed on the subject of control of houses, etc. Previously, there were two other Acts in force in the State of Bombay, viz., the Bombay Rent Restriction Act, 1939 and the Bombay Rents, Hotel Rates and Lodging House Rates (Control) Act,1944. By S. 50 of the Act, these Acts. were repealed. The first proviso, however, enacted (omitting unnecessary parts):
"Provided that all suits and proceedings between a landlord and a tenant relating to the recovery or fixing of rent or possession of any premises to which the provisions of Part II apply.......which are pending in any Court, shall be transferred to and continued before the Courts which would have jurisdiction to try such suits or proceedings under this act or shall be continued in such Courts, as the case may be, and all the provisions of this Act and the rules made thereunder shall apply to all such suits and proceedings."
It is this proviso which, it is claimed, has retrospective effect and S. 12 of the Act which is in Part II is said to apply to all pending cases, whenever the act is extended to fresh areas. Section 12 of the Act reads as follows:
"12. 1. A landlord shall not be entitled to the recovery of possession of any premises so long as the tenant pays, or is read
