2003 (2) TMI 482 - SC - Indian Laws

Summary

Issues Involved:
1. Legislative competence of the State Government to enact the impugned amendments.
2. Whether the impugned legislation is a colourable exercise of power and interferes with the judicial mandate of the Supreme Court.
3. Whether the impugned enactment is violative of Article 14 of the Constitution as being arbitrary and unreasonable.

Summary:

(i) Legislative Competence:
The State of Maharashtra and the beneficiaries of the legislation defended the impugned Amendment Act by attributing legislative competence to the State Legislature by reference to entries 6, 7, and 13 of List-III and entry 18 of List-II of the Seventh Schedule. The Court held that tenancy of buildings or house accommodation or leases in respect of non-agricultural property are not included in Entry 18 of List-II and fall within the field of entries 6, 7, and 13 of List-III. The Court emphasized that the legislative competence should be construed broadly to make the legislation effective and operative. The impugned Amending Act was found to be within the legislative competence of the State Legislature as it fell within the purview of entries 6, 7, and 13 of List-III and entry 18 of List-II, i.e., 'economic and social planning'.

(ii) Colourable Legislation and Judicial Mandate:
The Court examined whether the impugned legislation was a colourable exercise of power and interfered with the judicial mandate of the Supreme Court. It was held that the doctrine of colourable legislation does not involve any question of 'bona fides' or 'mala fides' on the part of the Legislature. The crucial question is whether there has been a transgression of legislative authority. The Court found that the impugned Amending Act fundamentally altered the basis of occupation of the premises by converting the privity of estate into privity of contract and extending the protection of the existing Rent Act to the occupants. The legislation was within the legislative competence of the State Legislature and did not overrule the judgments of the Supreme Court. The impugned Amending Act was not a piece of colourable legislation.

(iii) Arbitrariness and Unreasonableness:
The Court addressed the challenge that the impugned legislation was arbitrary and unreasonable under Article 14 of the Constitution. It was held that tenancy laws and rent restriction legislations are generally aimed at extending protection to tenants and striking a balance between landlords and tenants. The classification made by the impugned legislation was found to be reasonable and having a rational relation with the object sought to be achieved. The impugned legislation did not suffer from arbitrariness or invidious discrimination and was not violative of Article 14 of the Constitution.

Conclusion:
The challenge to the constitutional validity of the impugned Amending Act failed on all counts. The decision of the High Court was reversed, subject to the clarification that the mandate of the Supreme Court in Grahak Sanstha Manch's case regarding the vacating and derequisitioning of premises by 30.11.1994 and 31.12.1994, respectively, would remain unaffected. All appeals were allowed, and the impugned judgment of the High Court was set aside. Some writ petitions raising other issues were remanded to the High Court for hearing on those issues.