1961 (8) TMI 70 - SC - Indian Laws

Summary

Issues Involved:
1. Classification of appeals into three categories.
2. Determination of fair and standard rent under Section 7A of the Delhi and Ajmer-Marwara Rent Control Act, 1947.
3. Constitutionality of Section 7A and Schedule IV of the Control Act, 1947 under Article 14 of the Constitution.
4. Procedural adherence and principles of natural justice by the Rent Controller.
5. Jurisdictional questions regarding the completion date of construction.
6. Fixation of standard rent for vacant shops.
7. Applicability of the Delhi and Ajmer Rent Control Act, 1952.

Issue-wise Detailed Analysis:

1. Classification of Appeals into Three Categories:
The judgment classified the 16 appeals into three categories for convenience:
- Civil Appeals Nos. 172 to 184 of 1958.
- Civil Appeals Nos. 185 and 186 of 1958.
- Civil Appeal No. 171 of 1958.
The first two categories arose from a judgment by the High Court of Punjab, while the third category involved a separate building and was based on a different order.

2. Determination of Fair and Standard Rent under Section 7A:
The main point for consideration was whether the High Court's judgment declaring the proceedings before the Rent Controller as ultra vires and without jurisdiction was correct. The High Court had held that the Rent Controller's proceedings were ultra vires due to the application of Section 7A of the Control Act, 1947, which was deemed unconstitutional post the Constitution's enactment. The appeals focused on whether the premises were completed after March 24, 1947, making them subject to Section 7A for rent determination.

3. Constitutionality of Section 7A and Schedule IV under Article 14:
The Supreme Court analyzed whether Section 7A and Schedule IV violated Article 14 of the Constitution. The High Court had initially found these provisions discriminatory. However, the Supreme Court referred to a Full Bench decision in G.D. Soni v. S.N. Bhalla, which upheld the constitutionality of these provisions. The Court agreed that the classification between old and newly constructed premises had a rational nexus with the statute's objectives and did not violate Article 14.

4. Procedural Adherence and Principles of Natural Justice:
The Supreme Court examined whether the Rent Controller violated principles of natural justice. The Rent Controller had given the landlord multiple opportunities to present evidence, which the landlord failed to utilize. The Court found no violation of natural justice, emphasizing that the landlord's non-cooperation could not invalidate the proceedings. The Rent Controller's actions, including local inspections and enquiries, were justified given the landlord's repeated absence and non-compliance.

5. Jurisdictional Questions Regarding Completion Date:
For the premises in "Chemists' Market," the Rent Controller determined that the buildings were completed after March 24, 1947, based on local enquiries and inspection. The Supreme Court upheld this finding, rejecting the landlord's argument that the Controller's proceedings were invalid due to lack of jurisdiction. In "Prem Building," the Rent Controller and District Judge found that the second-floor flats were newly constructed post-March 24, 1947. The Supreme Court upheld these factual findings against the High Court's interference.

6. Fixation of Standard Rent for Vacant Shops:
The landlord argued that the Rent Controller had no jurisdiction to fix standard rent for vacant shops. The Supreme Court acknowledged that while it might not have been necessary to fix rent for vacant shops, this did not vitiate the proceedings for shops that were let out. The Court found that the Rent Controller's fixation of standard rent for the entire building, including vacant shops, did not affect the validity of the rent fixed for occupied shops.

7. Applicability of the Delhi and Ajmer Rent Control Act, 1952:
In Civil Appeal No. 171 of 1958, the tenant's application for standard rent fixation was dismissed based on the High Court's ruling that Section 7A was unconstitutional. The Supreme Court reversed this, noting that the application must be dealt with according to law, considering the Delhi and Ajmer Rent Control Act, 1952, which repealed the 1947 Act but included a saving clause for pending proceedings. The competent authorities were directed to consider the effect of the saving clause and any subsequent laws.

Conclusion:
The Supreme Court allowed all the appeals, setting aside the High Court's judgments and restoring the orders of the District Judge where applicable. The applications for fixation of standard rent were to be determined in accordance with the law, considering the observations made in the judgment. The appellants were entitled to costs, with one set of hearing fees for each category of appeals.