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IN THE HIGH COURT OF ALLAHABAD
D. S. SINHA, S. C. VERMA, S. R. SINGH
NUTAN KUMAR - Appellant
Versus
IIND ADDITIONAL DISTRICT JUDGE, BANDA - Respondents
C. M. W. P. 12384 Of 1987
Decided On : 05/20/1993
Whether an agreement of lease between the landlord and the tenant for letting and occupation of a building in contravention of the provisions of the U. P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 is void? Whether the said agreement is enforceable in law and a decree for ejectment of the tenant can be passed in favour of the landlord on the basis thereof?
Fact of the Case:
The petitioners are the owners of the suit premises namely, Quarter No. 13, dubey Building situate at Station Road, Banda City, District Banda which admittedly falls within the purview of the U. P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972, (U. P. Act No. 13 of 1972) and was so even in June-July 1977, when it was let out to the defendant Sri S. K. Tripathi arrayed as respondent No. 3 on a monthly rent mutually agreed upon between the parties. The tenancy in favour of the respondent No. 3 was created otherwise than pursuant to an order of allotment. The defendant fell in arrears of rent for a period exceeding four months and failed to pay the same to the petitioners within one month from 9-8-1982 - the date of service upon him of the notice of demand dated 4-8-82 which being a combined notice of demand and termination of tenancy, the petitioners filed a suit, it being SCC Suit No. 17 of 1982 in the Court of Civil Judge, Banda who was exercising the powers of Judge, Small Causes Court, for ejectment, recovery of arrears of rent and damages for use and occupation etc. The defendant filed written statement and admitted the plaintiff-petitioners to be the owners of the suit premises as also the creation of contractual tenancy in his favour though he disputed the rate of rent. At the same time, it was also pleaded by the defendant in his written statement that the U. P. Act 13 of 1972 was applicable to the suit premises and therefore, the contract of lease being in contravention of the Act was void and unenforceable by law. The plea as to the suit instituted on the basis of the said contract being not cognizable by Small Causes Court, was also raised.
Finding of the Court:
1. An agreement of lease between the landlord and the tenant for letting and occupation of a building in contravention of the provisions of the U. P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 is void. 2. The said agreement is unenforceable in law and no decree for ejectment of the tenant can be passed in favour of the landlord on the basis thereof.
Issues: 1. Whether a contract of tenancy and the lease created pursuant thereto regarding a building governed by the U. P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972, without an order of allotment under Section 16 of the Act are illegal and void in law? 2. Whether such a contract of tenancy and the lease as aforesaid are enforceable by law and whether a decree for ejectment and recovery of mesne profits/damages for use and occupation of the building under a void lease, can be passed in favour of the lessor against the lessee?
Ratio Decidendi: 1. Sections 11, 13 and 31 of the U. P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972, unmistakably, stipulate that a building covered by it can neither be let nor occupied except in pursuance of an allotment or release order. The object of letting or occupation of the building without allotment-release order is completely forbidden. 2. Any agreement formed with the object to let or occupy the building subject to and governed by the new Act, except in pursuance of an allotment/release order, besides being clearly forbidden, if permitted, will defeat the provisions of Sections 11, 13 and 17 of the new Act resulting in frustration of one of the avowed objects of the said Act, namely, regulation of letting the building falling within its ambit. It will also be opposed to public policy of the new Act which is to vest the control of letting and occupation of the building in the District Magistrate for the benefit of such members of the public as are in need thereof. 3. Obedience of the fiat of the Law of the State is an essential ingredient of public policy. Any agreement which does not obey the command of Law is opposed to public policy and, therefore, void. 4. The concept that an agreement may be void in relation to a specified person and may be valid or voidable between the parties thereto is not applicable to an agreement the very formation whereof law interdicts; or which is of such a character that, if permitted, it would frustrate the provisions of any law; or is fraudulent; or involves or implies injury to the person or property of another; or the court regards it as immoral or opposed to public policy. Neither party can enforce said agreement. No legal relations come into being from an agreement offending a Statute or public policy.
Final Decision: The Full Bench answers and holds thus: 1. An agreement of lease between the landlord and the tenant for letting and occupation of a building in contravention of the provisions of the U. P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 is void. 2. The said agreement is unenforceable in law and no decree for ejectment of the tenant can be passed in favour of the landlord on the basis thereof.
( 1 ) ON a reference by a learned single Judge the following two questions are up for consideration and answer:1. Whether an agreement of lease between the landlord and the tenant for letting and occupation of a building in contravention of the provisions of the U. P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 is void? 2. Whether the said agreement is enforceable in law and a decree for ejectment of the tenant can be passed in favour of the landlord oil the basis thereof?
( 2 ) IN our country, except so far as specifically provided for and covered by any other legislation, the matter relating to all agreements constituting subsratum of a valid contract are subject to and governing by the Indian Contract Act, 1872, hereinafter called the Contract Act.
( 3 ) CLAUSES (h) and (g) of Section 2 of the Contract Act declare that all agreement which are enforceable by law are contracts and those which are not enforceable by law are void.
( 4 ) ESSENTIAL components of a valid contract areprovided in Section 10 of the Contact Act. These are as below. (i) Competence of the parties to the agreement; (ii) Free consent of the parties; (iii) Lawfulness of consideration and object of the agreement; and (iv) Absence of express declaration under the Contract Act rendering the agreement to be void.
( 5 ) OF the above noted four basic ingredients, lawfulness of the object of the agreement and absence of express declaration under the Contract Act rendering the agreement to be void are pertinent in the context of investigation of the questions under consideration.
( 6 ) SECTION 23 of the Contract Act envisages that object of an agreement will be unlawful, if- (A) it is forbidden by law; or (b) is of such a nature that, if permitted, it would defeat the provisions of any law; or (c) is fraudulent; or (d) involves or implies injury to the person or property of another; or (e) the Court regards it as immoral, or opposed to public policy. The section also expressly declares that every agreement of which the object in unlawful, is void.
( 7 ) THUS, every agreement made for or about any matter or thing which is either forbidden by any statute, or would defeat the provisions of any law, or the court regards it as opposed to public policy, is unlawful and ipso facto void.
( 8 ) INTERDICTION of any matter or thing, on which an agreement is founded, may be expressly provided for in a statute. But it is not always necessary to do so. The statute may, instead of expressly declaring any matter or thing to be prohibited, merely provide penalty for the offender, and in that event also the matter or thing will be taken as forbidden by the statute. In a penalty a prohibition is implicit and inherent. The appellation void, in relation to a juristic act, means without legal force, effect or consequence; not binding; invalid; null; worthless; cipher; useless; and ineffectual etc.
( 9 ) VOID agreements are destitute of all legal effects and force. They are totally ineffectual rather cipher. No legally enforceable relationship, right or liability emanates therefrom.
( 10 ) WITH the avowed object "to provide, in the interest of the general public, for the regulation of letting and rent of, and the eviction of tenants from, certain classes of buildings situated in urban areas, and for matters connected therewith" the legislature of the State of Uttar Pradesh enacted the U. P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 (U. P. Act No. 13 of 1972), hereinafter called the new Act, repealing the U. P, (Temporary) Control of Rent and Eviction Act, 1947 (U. P. Act No. III of 1947), hereinafter called the old Act.
( 11 ) SECTIONS 11, 13 and 17, falling in Chapter III of the new Act which relates to regulation of letting, have material bearing in the context, and are, therefore, extracted below. "11. Prohibition of letting without allotment order.- Save as hereinafter provided, no person shall let any building excep
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