Section 3 of the East Punjab Urban Rent Restriction Act, 1949 (Act III of 1949) is not ultra vires the Constitution of India and the notification issued under Section 3 is valid and applies to buildings that have been reconstructed.

Mahajan, J.

1. By this order we propose to dispose of three matters which arise out of different proceedings, but are being dealt with because common questions of law arise. The facts of each matter will be set out separately so far as necessary for the purposes of the disposal of those matters. Letters patent Appeal No. 276 of 1958:

2. This appeal is directed against the decision of Grover, J., dismissing the appellants regular second appeal. The property in dispute is a District Board sarai situate in Pathankot. this property is government property vesting in the District Board. It was leased out by the District Board in the year 1945 for one year and latter on this lease was renewed on yearly basis up the year 1947.

There is no lease after 1947 and the appellant has continued in possession. The District Board issued a notice to the appellant to vacate the premises and on his failure to do so filed the present suit for his ejectment. In defence a number of pleas were raised by the appellant but it is not necessary to notice all of them excepting those which were ultimately agitated before the learned Single Judge. There please were: (1) that Section 3 of the East Punjab Urban Rent Restriction Act (III of 1949)-here in after referred to as the Act-under which exemption has been given from the provisions of the Act to Government premises is ultra vires the Constitution of India;

(2) that the notification exempting all government buildings under Section 3 of the Act is outside the scope of Section 3 and, therefore, the applicability of the Act cannot be ruled out;

(3) that the appellant is a permanent tenant; and

(4) that the appellant had incurred huge expenses in improving the premises on the belief that he was to continue as a lessee for a considerable period and, therefore he could not be evicted with compensation being paid to him for the improvements effected by him.

The trial Court decreed the suit on the 19th of November, 1953, and on appeal by the present appellant the trial Courts decree was a firmed on the 31st of August 1954. A second appeal was preferred to this Court and the appeal was rejected as already stated, the Grover, J. on the 10th of April, 1958 (See AIR 1960 Punj 172). In Second Appeal, the appellant set up the plea that the matter had been compromised with the Government, but it was ruled that there was no compromise in the matter, and, therefore the appeal was decided on the merits. Before us also, an application had been made that talks to compromise the matter are going on with the Government. The learned counsel for the State has vehemently denied that there is any talk of compromise with the Government with the result that by a separate order we have rejected the petition of the appellant requesting for an adjournment for the completion of the compromise.

3. Before us the learned counsel for the appellant has raised the four points already mentioned above and they will be dealt with in the order in which they have been mentioned. Regular Second Appeal No. 1816 of 1959:

4. This case came up for hearing before Pandit J, who by his order dated the 20th or July, 1960, referred it for decision to a larger Bench and that is how this case has been placed before us. The facts are given in detail in the order of Pandit J. and need not be recapitulated. In appeal, the appellant challenges the decision of the lower appellate Court on the ground that the lower appellate Court was in error in holding that the notification does not cover the reconstructed buildings but on the other hand it is contended by the tenant-

(1) that Section 3 of the Act is ultra vires the Constitution; and

(2) that the notification issued under section 3 of the Act, which is in these terms: In exercise of the power conferred by section Act, 1940 (Punjab Act No. III of 1949) the Governor of Punjab is pleased to exempt all buildings constructed during the years 1956, 1957 and 1958 from the provisions of the said Act for a period