Roshan Lal Mehra Vs. Ishwar Das 
INSC 232 (2 August 1961)
SINHA, BHUVNESHWAR P.(CJ) SARKAR, A.K.
AYYANGAR, N. RAJAGOPALA MUDHOLKAR, J.R.
CITATION: 1962 AIR 646 1962 SCR Supl. (2) 947
CITATOR INFO :
F 1963 SC1060 (4,5)
Standard rent, (fixation of-Newly Constructed
and old buildings-Classification, if violative of fundamental right and
principles of natural justice-Constitution of India, Art. 14-Delhi and
Ajmer-Marwara Rent Control Act, 1947 (Act XIX of 1947), ss. 7, 7A, Sch. IV.
The appellants applied to the Rent Controller
for fixation of fair and standard rent of certain shops and other premises
alleging that the rent charged by the landlords was exorbitant. The questions
arising for determination were (1) whether the Delhi and Ajmer-Marwara Rent
Control Act, 1947 in so far as it provided for the fixation of standard rent in
respect of premises the construction of which was completed after March 24,
1947 by the Rent Controller violated the fundamental right guaranteed under
Art. 14 of the Constitution; and (2) whether the procedure to be followed by
the Rent Controller' violated the principles of natural justice.
Held, that s. 7A and the relevant provision-,
of Sch. IV of the Act laying down the procedure for fixing standard rent by the
Rent Controller are not unconstitutional and do not violate Art. 14 of the
Constitution. The classification between premises the construction of which was
completed before March 24, 1947 when the Act came into force and those which
were completed thereafter, is reasonable, and the criteria for the fixation of
standard rent for both old and new buildings under the Act were not
The procedure laid down under those
provisions does not violate the principles of natural justice. The power given
to the Rent Controller is not arbitraly and he has to exercise it on a judicial
consideration of all the circumstances of the case.
948 G.D. Soni v.. S. N. Bhalla, A.I.R. 1959
Punj. 381 approved.
New Prakash Transport, Co. Ltd. v. New
Suwarna Transport Co.
Ltd., (1957) S.C.R. 98, Union of India v.
T.R. Verma (1958) S.C.R. 499 followed.
In the instant case ample opportunity was
given to the landlord for producing all relevant evidence in the case which he
did not avail himself of. It was not necessary under para 2, Sch. TV, to have
two enquiries one for ascertaining whether there were good reasons for
believing that the rent charged was exorbitant and another for fixing the
The proceedings before the Rent Controller
were not vitiated merely because standard rent of certain vacant shops was
also., fixed in the process of fixing the standard rent for the entire building
in which those shops were situated; that would not affect the legality of the
fixation of the rent for the shops which had been let out to tenants.
CIVILAPPELLATE JURISDICTION: Civil Appeal No.
171 of 1958.
Appeal by special leave from the Judgment and
order dated March '7, 1956, of the Punjab High Court (Circuit Bench) at Delhi
in Civil Misc. No. 249-D of 1956.
WITH Civil Appeals Nos. 172 to 186 of 1958.
Appeals from the judgment and order dated
August 26, 1954, of the Punjab High Court in Civil Revisions Nos. 243, 274,
276, 277, 281 to 286, 288, 290 and 293 and 295 of 1951.
Anoop Singh, for the appellant in Civil
Appeal No. 171 of 1958.
Basant Kumar Jaggi, for the respondent. (In
Civil Appeals Nos. 172 to 186 of 1958).
A.V. Viswanatha Sastri, R. Ganapathy Iyer and
O. Gopalakrishnan, for the appellants in Civil Appeals Nos. 1722 to 186 of
C.K. Daphtaru Solicitor General of India,
C.B. Aggarwala and K.P. Gupta, for the respondent$ Nos: 1 to 4.
949 1961. August 2. The Judgment of the Court
,",as delivered by S.K. DAS, T.-These are 16 appeals which have been heard
together. For facility of considering them on merits, it would be convenient to
classify them into three categories.
In the first category fall Civil Appeals Nos.
172 to 184 of 1958. In the second category are two appeals, Civil Appeals Nos.
185 and 186 of 1958. In the third category falls Civil appeal No. 171 of 1958.
The appeals in the first two categories arise out of a judgment in revision
rendered by the High Court of Punjab at Simla on August 26, 1954. That decision
was reported in British Medical Stores v. L.
Bhagirath Mal (1). The appeal in the third
category arises out of a short order of the said High Court dated March 7,
1956, by which it dismissed an application made by the appellant-tenant under
Art. 227 of the Constitution. It appears that the order war, based on the
decision given by the High Court in the first two categories of cases. The
appeals in the first two categories have been brought to this Court on a
certificate granted by High Court, and have been consolidated by an order made
by the said Court. Civil Appeal No. 171 of 1958 has been brought to this Court
in pursuance of special leave granted by. this Court on November 19, 1956.
The reason why these appeals have been put in
three categories is this. The judgement of the High Court against which appeals
are really directed is the judgment rendered in the first two categories of
eases (reported in Messrs.
British Medical Stores v. L. Bhagirath Mal
(1). That judgment related to four sets of' buildings of Chandini Chowk in
Delhi. In Civil Appeals Nos. 172 to 186, we are concerned with two of these
buildings owned by the landlord Bhagirath Mal, who has since died ,(1) (1955)
I. L. R. 8 Punjab 639.
950 and is now represented by some of the
respondents. For convenience, however, we shall refer to him as the landlord.
The two buildings we are concerned with are
called (1) "Chemists' Market", also known as "Medicine
Market", and (2) "Prem Building". Both these buildings are part
of a colony called "'Bhagirath Colony". Several tenants took on rent
flats or rooms in the said buildings and the question which fell for
determination was the fair and standard rent payable for the said flats or
rooms under s. 7A of the Delhi and Ajmer Marwara Rent Control Act, 1947, (Act
XIX of 1947), hereinafter referred to as the Control Act, 1947. In the first
two categories of appeals, the main point for consideration before us is
whether the judgment rendered by the High Court on August 26, 1954, was
correct, the High Court having held that the whole proceedings taken before the
Rent Controller were ultra vires and without jurisdiction. 'The reasons given
for this finding by the High Court were not quite the same in respect of the
two buildings; somewhat different reasons were given in the cases of the two
tenants in the Prem Building. Therefore, it would be convenient to deal with
the main judgment of the High Court in Civil Appeals Nos. 172 to 184 of 1958 of
the tenants in the building known as "Chemists' Market". We shall
then deal with the special considerations arising in the two appeals preferred
by the tenants of the "Prem Building". Lastly, we shall deal with
Civil Appeal No. 111 of 1958 which relates to a different building altogether
belonging to a different proprietor, namely two ground-floor flats of a house
on plot No 20, Block No. 13 in Western Extension Area, Karolbagh, New Delhi.
We. shall later state the facts of that appeal, but it is sufficient to state
here that the application for fixation of standard rent for the flats in the
Karolbagh house was dismissed on the ground that the High Court had held
earlier in the first two categories of cases, that s. 7A of the Control Act,
1947 was unconstitutional and 951 void after the coming into force of the
Constitution of India on January 26, 1950.
Civil Appeals Nos. 172 to 184 of 1958 Having
made these preliminary remarks with regard to the classification of the
appeals, we proceed now to state the facts with regard to the first category of
appeals relating to the "Chemists' Market" in Bhagirath Colony. On
July 30, 1948, nine tenants made an application to the Rent Controller, Delhi,
asking for a determination of fair and standard rent of the tenements (shops)
rented to them by the landlord, on the ground that under the stress of
circumstances which resulted from the partition of the country and scarcity of
business premises available in Delhi after partition, they were forced to take
on rent the shops in question on an excessive and exorbitant rate of rent
charged by the landlord. They alleged that the premises were completed after
March 24, 1947, and they were entitled to have the fair and standard rent
determined for the shops in question by the rent Controller. On August 1, 1948,
the Rent Controller recorded an order to the effect that in order to fix the
rent of the shops in question in accordance with s. 7A read with Sch. TV of the
Control Act, 1947 a summary enquiry would be held on August 18, 1948. A notice
was issued to that effect to the landlord, directing him to attend and bring
all relevant authenticated records such as plans, account books, vouchers etc.,
showing the cost of construction of the building; the landlord was also asked
to bring documentary evidence relating to the date of completion of
construction of the building. It is necessary to explain here why-the date of
completion of construction of the building was important. The Control Act, 1947
came into force on March 24, 1947. By s. 1(2) thereof, as it originally stood,
it was not applicable to any premises the construction 952 of which was not
completed by March 24, 1947, and which was not let to a tenant before the
enforcement of the Act.
Later, there was an Ordinance (Ordinance No.
XVIII of 1947) followed by all Act (Act L of 1947)by which enactment only
constructed buildings were brought within the purview of the Control Act, 1947
by repealing s. 1(2) of the Act in so far as it affected buildings iii. Delhi
and by introducing s,7 A and Sell. IV to the Act. We shall presently read s. 7
A and the relevant provisions of Sch. IV. We may just state here that s.7A laid
down that the fair rent of the constructed buildings shall be fixed according
to the provisions set forth in Sch. TV. Buildings which were completed earlier
than March 24, 1947, had to be dealt with by the Civil Court under s.7 of the
Act. Under s.7A read with. Sch. IV, the Rent Controlled had jurisdiction to fix
the, fair and standard rent in respect of buildings which were not completed
before the commencement of the Act.
Therefore, the Rent Controller had to
determine the date of completion of the building, in order to have jurisdiction
under s.7A of the Control Act, 1947.
We have referred to the notice which the Rent
Controller had directed to be issued to the landlord on August 12, 1948;
fixing August, 18 1948, as the date for the
hearing of the case. On August 18, the landlord made an application by means of
a letter sent to the Rent Controller in which he, asked for postponement of the
case to some date in September. The case was postponed to August 26, 1948, but on
that date the landlord again asked for an adjournment.
Then on September 1, 1948, an application was
made on behalf of the landlord, in which there was a reference to 14 tenants
who had applied for fixation of standard rent for the shops in the Chemists'
Market. In this application the landlord stated that he himself had applied for
fixation of 953 standard rent under s. 7 of the Control Act, 1-947 in the Court
of the Subordinate Judge, Delhi and as those applications were pending, he
prayed that the proceedings for determining the identical question of fixation
of standard rent by the Rent Controller tinder s.7A should be stayed. The
printed record does not clearly show how and when tenants other than the 9
tenants who had originally applied for fixation of standard rent on July 30,
1948, had also applied for fixation of standard rent for the shops in their
occupation. It is clear, however, from the application of, the landlord dated
September 1, 1948 that 14 tenants including some of those who had applied on
July 30, 1948 had applied for fixation of standard rent for the shops occupied
by them. On November 9, 1948, the Rent Controller wrote a letter to the
landlord in which he referred to some enquiry held in his officer on September
1, 1949 and said:.
"On that day you promised to produce
some papers to show that these shops were completed before March 24, 1947. As
the case is unnecessarily being delayed, you are requested to appear in my
office with all the necessary document at 3 P.m. on Wednesday the 17th
November, 1948. It may please be noted that no further adjournment will be
possible. Your failing to comply with this notice, ex-parte decision will be
On November 15, 1948 the Rent Controller
again wrote to the landlord that on a representation by the landlord's
representative, the date had been extended to November 19, 1948 and the
landlord should produce all necessary documents relating to the building in
quest-ion. The Rent Controller again reminded the landlord that there would be
a final hearing on November 19. On that date, however, the landlord again made
an application saying that as there were regular suits for the determination
954 of the standard rent pending in the Court of the Subordinate Judge, Delhi,
the proceedings before the Rent Controller should be stayed. On November 26,
1948 the Rent Controller wrote to the landlord to the following effect:
"'As you have failed to attend my office
personally on the fixed date and your attorney did not possess any information
or documents regarding the newly constructed "Chemists' Market", you
are now directed to submit your written statement on oath, duly countersigned
by your advocate, giving full details regarding the date of construction of the
said building. Please note that your statement must reach this office before
the 3rd December 1948".
Then on December 3, 1948 the Rent Controller
wrote to the landlord saying that he would be visiting the premises on December
5, 1948. On December 3, a telegram was sent on behalf of the landlord saying
that lie was out of station.
On that date the Rent Controller recorded the
"These shops were first let out from 1st
April, 1948. Note.-The Advocate for the landlord was requested to tell the
landlord that he must submit his statement in writing (countersigned by the.
Advocate) within the next 15 days whether he contends or does not contend that
this building was completed after 24th March, 1947.
The Advocate for the landlord gave an
application asking for staying the proceedings as he had applied to the
Sub-Judge for fixation of standard rent of the premises. He was told that I was
not prepared to stay the proceedings unless he or his client were prepared to
say on oath that the building was completed before the 24th March, 1947." 955
On December 9, 1948 the Rent Controller again wrote to the landlord to the
" I am in receipt of your telegram dated
the 3rd December, 1948.
On 19th November, 1948, the last date of
hearing, your Advocate Shri Jugal Kishore and your General Attorney Shri Kundal
Lal were given definite instruction to see that your written statement, as to
when the construction of' the "Chemists' Market" was started and when
completed, was sent to me within 15 days.
These instructions were later confirmed in
writing vide this office No. R. C. 42/ Camp.
dated the 26th November, 1948. My
instructions, however, have not been complied with so far and it is presumed
that you are try g to evade the issue.
I, however, give you another final
opportunity and direct you to submit your written ,statement on oath within one
week from the receipt hereof, showing the date of completion of construction
of' your building known as "Chemists' Market" in Bhagiratli Colony,
Chandni Chowk, Delhi.
Please take notice that your failure to
comply with (torn) within the stipulated period will amount to disobeying the
orders of this Court and the case will be referred to appropriate authorities
for necessary action in the matter." The landlord took no steps whatsoever
to furnish any written statement. In these circumstances, the Rent Controller
passed his final order on January 10, 1949. In that order he recited the facts
stated above and ended up by saying that though the landlord had been given
sufficient opportunity, he had not made any statement in writing or 956
otherwise and that the landlord was clearly trying to avoid the trial of the
issue. The Rent Controller had inspected the building on December 12. 194S and
made local enquiries. He came to the finding that the shops in question were
completed only in the beginning of 1948. He said:
"I inspected this building on 12th
December, 1948 and made local enquiries when it transpired that the building
(shops) was completed only in the beginning of 1948. The very look of the building
also confirms this information. On the other hand, no data has been placed before
me by the landlord, his attorney or the advocate to show that the construction
of the building was completed.
before 24th March, 1947. According to the
admitted statement of the attorney the shops have been let out for the first
time in 1948 and otherwise too his statement of 19th November, 1948 shows that
the building had not been completed before 24th March, 1947. No completion
certificate or house-tax receipts have been produced in support of this contention.
It is, therefore, not understandable how it is claimed that the shops were
completed before 24th March, 1947. The owner is knowingly avoiding to give a
statement himself that the shops were completed before 24th March, 1947.
Evidently because he realises that this is not true. It has also not been
stated what use was made of these shops till January, 1948, when they were
first let out if they had been completed before 24th March, 1947 as alleged.
It is unbelievable that shops like these
could remain unoccupied for nearly 9 to 1.0 months after completion. I am,
therefore, convinced beyond a shadow of doubt that the construction of there
shops was completed long after 24th March, 1947, and the fixation 957 of their
standard rent definitely falls within the scope of s. 7 A of the Delhi and
AjmerMarwara Rent Control Act, 1947(as amended).
I,therefore, proceed to fix the rent
accordingly." After taking into consideration the nature of the
construction and the fittings, etc., and other relevant considerations the Rent
Controller fixed the valuation at Rs. 9-7-0 per sq. ft. of plinth area for
working out the probable cost of the construction of the building. The cost of
the land, he estimated at Rs. '275 per sq. yd.; but he allowed only one-third
of the estimate inasmuch as the building was one storeyed and all the buildings
in the vicinity were mostly three-storeyed. On these calculations, lie held
that the standard rent for all the shops in the building work out at Rs. 335
per month including 10% for repairs but excluding house tax and charges for
consumption of water and electricity. A calculation sheet was prepared fixing
the standard rent for each of the shops including some shops which were vacant,
oil the aforesaid' basis. The calculation sheet showed that the standard rent
of 18 ,shops in the building varied from Rs. 10 per month to Rs. 50 per month.
Against the order of the Rent Controller
dated January 10, 1949, nineteen appeals were taken to the District Judge.
One of the points taken before the District
Judge was that the Rent Controller had no jurisdiction to fix the standard rent
inasmuch as the building had been completed before March 24, 1947. The learned
District Judge dealt with this point at length, and held that the Rent
Controllers finding on the question of jurisdiction was correct. As to fair
rent, he held that though the building was single-storeyed, there was no reason
why the landlord should not be allowed the full value of the land on which the
Allowing full value for the land and having
regard to the rent of premises in the neighbouring area the learned 958
District Judge modified the order of' the Rent Controller and fixed the
standard rent of the building at Rs. 670 per month, viz., double. of what was
fixed by the Rent Controller. The learned District Judge passed his order on
January 15, 1951.
It appears that from the order of the
District Judge, Delhi dated January 15, 1951, certain applications in revision
were. made to the Punjab High Court. Most of the applications were by the
landlord, but one of them was by a tenant. These applications were heard
together by the High Court. The High Court allowed the applications of the
landlord and held in effect that the proceedings before the Rent Controller
violated the principles of natural justice and were, therefore, bad and without
jurisdiction. The High Court, it appears, travelled over a wide field and dealt
with a number of questions, though its decision was based on the finding stated
above. The first question which the High Court considered was whether s.7A read
with Sch. IV of the Control Act, 1947 prescribed a discriminatory procedure
without a reasonable classification in respect of premises completed after
March 24, 1947 and thus violated the guarantee of equal protection under Art.
14 of the Constitution. Along with this question was canvassed another
connected question viz., whether these cases would be governed by the law in
force at the time of the decision given by the Rent Controller or by the law
existing at the time when the District Judge heard the appeals. It may be here
noted that the Constitution of India came into force on January 26, 1950 and at
the date of decision of the Rent Controller Art. 14 of the Constitution was not
The High Court expressed the view that the
law to be applied was the law in existence at the time when the District Judge
decided the appeals. It further held that s. 7A read with Sch. IV of the
Control Act, 1947 was violative of the guarantee of equal protection 959 of
laws under Art. 14 of the Constitution, there being no rational nexus between
the classification made regarding premises old and new and the objects of the
statute. Having given these two findings, the High Court said, however, that it
would prefer not to base its judgment on these findings, because to do so might
be giving retrospective effect to the Constitution. The High Court then went,
on to consider the further contention urged before it that in the proceedings
before the Rent Controller there was a violation of the principles of natural
justice inasmuch as all recognised principles governing tribunals which
exercise quasi-judicial powers or follow a procedure subserving the orderly
administration of justice had been. disregarded. On this point the learned
Judge, delivering the judgment of the Court, expressed himself as follows
"In the present case no 'evidence as to rent was called from the parties
or recorded by the' Controller nor was any opportunity afforded to the parties
to adduce such or any evidence which they considered necessary to submit. The
Controller made private enquiries and his order shows that he has based his
decision on the cost of the building which he himself calculated without allowing
the petitioner an opportunity to show that such calculation was wrong or its
Of course, there is no procedure prescribed
by the Schedule and whatever procedure was followed does not sub serve the
orderly administration of justice. So that the, determination is based oil
private enquiries, unchecked calculations and no evidence of the parties who
were afforded no opportunity of proving their respective cases." With
regard to the flats in 'Prem Building'a farther ground given by the High Court
was that they were, 960 not now construction as held by the District Judge, and
therefore s.7A was not applicable for determination of fair and standard rent
in respect thereof.
We may first dispose of the constitutional
point that s.7 A read with Sch. IV of the Control Act, 1947 violated the fundamental
right guaranteed under Art. 14 of the Constitution. We may 'here read s.7A and
some of the provisions of Sch. IV.
"7A. The provisions set out in the
Fourth Schedule shall apply to the fixation of rent and other matters relating
to the premises in Delhi (hereinafter referred to as the newly constructed
premises) the construction of which was not completed before the commencement
of this Act.
The Fourth Schedule 1."Rent Controller
or the purposes of this Schedule means the person appointed by the Central
Government as the Rent Controller.
2.If the Rent Controller on a written
complaint 'or otherwise has reason to believe that the rent of any newly
constructed premises is excessive, he may, after making such inquiry as he
thinks fit proceed to fix the standard rent thereof.
3.The Rent. Controller in fixing the standard
rent shall state in writing his reasons there for.
4.In fixing the standard rent the Rent
Controller shall take into consideration all circumstances of the case
including any amount paid or to be paid by the tenant by way of premium or any
other like sum in addition to rent.
961 5 and 6. x x x x x 7.For the purposes of
an inquiry under paragraphs 2, 5 and 6, the Rent Controller may(a)require the
landlord to produce any book of account, document or other information relating
to the newly constructed premises, (b)enter and inspect such premises after due
notice, and (e)authorise any officer subordinate to him to enter and inspect
such premises after due notice.
8 to 10. x x x x x
11. Any person aggrieved by an order of the
Rent Controller may, within thirty days from the date on which the order is
communicated to him, appeal to the District Judge, Delhi." This very
question was considered by a Full Bench of the same High Court in a later
decision (see G. D. Soni v. S. N.
Bhalla(1). In that decision the High Court
went into the entire history of legislation with regard to the control of house
rent in both old Delhi and New Delhi from 1939 onwards when the second world
war broke out. The High Court pointed out that the New Delhi House Rent Control
Order, 1939 made under r. 81 of the Defence of India Rules was the first
Control Order seeking to control rent of houses in New Delhi and the Civil
Lines. From 1939 till 1942 no Rent Control Act applied to the municipal area of
Delhi. On October 16, 1942 the Punjab Urban Rent Restriction Act, 1941 with
suitable adaptations was extended to that area. Under that Act a landlord could
recover only standard rent from the tenant and the term "standard rent-'
was defined as meaning the, rent at (1) A I.R. 1959 Punj which the premises
were let on January 1, 1939 and if not so, the rent at which the were last let.
In cases not governed entirely by this definition, the Court was given the
power to fix standard rent. In 1944 the then Governor-General promulgated the
Delhi Rent Control Ordinance, 1944. Under this Ordinance the Chief Commissioner
could apply it to any area within the Province of Delhi and whenever the
Ordinance was made applicable to any area, the Punjab Urban Rent Restriction
Act, 1941 ceased to be operative. In the Ordinance also standard rent was
defined substantially in the same terms as in the Punjab Act. The Central
legislature then enacted the Control Act, 1947 which repealed the Punjab Act as
extended to Delhi and also the Rent Control Order of 1939 and the 1944
Ordinance. By s.1(2) the Act, was made inapplicable to any premises the
construction of which was not completed by March 24, 1947 and under s.7 of the
Control Act, 1947, at Court in case of dispute had to determine the standard
rent on the principles set forth in the Second Schedule. We have already stated
earlier that s.1 (2) of the Control Act, 1947 was later repealed (so far as, it
affected buildings in Delhi), and newly constructed buildings were brought
within the purview of the Control Act, 1947 by introducing s.7A and Schedule,
IV to it.
From this brief survey of the legislative
history of the control of rent of premises situated in the Province of Delhi,
it is clear that the Control Act, 1947 brought about uniformity in the law
relating to rent control by laying down that the standard rent of newly
constructed premises shall be fixed by the Rent Controller while the Court will
fix the standard rent in respect of other premises. There is no doubt that a
classification was made between premises the construction of which was,
completed before March 24, 1947 and those the construction of which was
completed after that date. The question is whether this classification is based
on 963 intelligible differentia having a rational nexus with the objects of the
statute. Dealing with this question Bishan Narain, J. delivering the judgment
of Full Bench said:
'The learned counsel for the landlord
challenged the validity of these provisions on the grounds (1) that there is no
reasonable basis for fixing the standard rent of newly constructed premises
differently on a different principle from the principle on which standard rent
is fixed for old buildings in the same locality and (2) that there is no reason
for discriminating against the landlords of newly constructed buildings by
laying down that their standard rent shall be fixed by Rent Controllers
appointed by the Central Government while the standard rent of other buildings
is to he fixed by courts of law which are bound to follow procedure laid down
in the Civil Procedure It is urged that the Rent Controller is not bound by any
procedures laid down by the Civil Procedure Code or the Punjab Courts Act.
x x x Section 7 says that the standard rent
shall be determined in accordance with the principles set forth in the Second
Schedule. The Second Schedule fixes basic rent as determined tinder the Control
Order of 1939 or under the 1944 Ordinance and in other cases the contractual
rent on 111-1939 or if not on that day then on the date first let after
The standard rent thus fixed is to be
increased by certain percentage specified in the Schedule. If the premises were
let after 2-6-1944 then the basic rent and the standard rent were to be the
same. Obviously this principle for fixation of standard rent could not possibly
have any application to premises constructed and let after 964 24-3-1947.
Section 7 then proceeds. to lay down that if for any reason it is not possible
to determine the standard rent of any premises set forth in the Second Schedule
then the courts shall determine it having "regard to the standard rent of
similar premises in the same locality and other relevant considerations".
Para 4 of Schedule IV lays down In fixing the standard rent the Rent Controller
shall take into consideration all the circumstances of the case including any
amount paid or to be paid by the tenant by way of premium or any other like sum
in addition to rent.' It was argued on behalf of the landlord that the critera
laid down in s.7(2) and para 4 of Schedule IV of the Act is substantially
different and that there is no valid reason for such a differentiation. He
urgent that the Rent Controller (1) may ignore the standard rent of similar
premises in the same locality while he is under an obligation to take into
consideration any amount Paid or agreed to be paid by the tenant by way of
premium etc. in addition to rent and that the Rent Controller (2) cannot
interfere with the agreed rent unless he finds it excessive and in that he can
only reduce the rent fixed between the parties and cannot increase it. It; is
urged that under s. 7(2) it is open to the Court to increase the standard rent
and also not to take into consideration any amount paid by the tenant as
premium in addition to rent.
Now the Rent Controller is enjoined by para 4
to take into consideration all the circumstances of the case when fixing
standard rent. It is not understood how a Rent Controller can omit to consider
the standard rent of similar premises in the same locality. This is obviously a
relevant consideration though para 4 does not specifically mention it. It is
true that this criteria has been 965 specifically mentioned in s.7(2)of the Act
and has not been so mentioned in s.7A.but. this circumstance cannot lead to the
inference that it is open to the Rent Controller to ignore it.
The words of para 4 are in fact as wide in
effect as the words used in s.7(2) of the Act. In this context it must not be
forgotten that if such a mistake is made by the Rent Controller then the
aggrieved party (may he be landlord or the tenant) can appeal to the District
Judge whose powers are co-extensive with those of the Rent Controller and who
can set right any mistake made by the Rent Controller. I am, therefore, of the
opinion that the criterion laid down for fixation of standard rent in s.7(2)
and para 4 is substantially the same in scope and is not different.
x x x x x Undoubtedly under Schedule: IV the
Rent Controller can fix standard rent only if he finds that the rent agreed
upon between the parties is excessive. This provision is to protect the
landlord from frivolous applications by tenants and it is not clear why a landlord
should object to this provision.
The reason for this provision is
It is. well known that rents in Delhi prior
to 1-11-1939 were very, low and in some cases uneconomic. Therefore the
legislature decided that in such cases a landlord should be. in a position to,
got standard rent fixed at a rate higher than fixed by agreement of the parties
in 1939 or earlier. No such consideration arises in the 'case of buildings
constructed. or completed after 1947.
In 1947 there existed an acute shortage of
accommodation in Delhi and the landlords were in, a position to dictate terms
and, therefore, presumably the fixed between the parties were not so low as to
require, in966 considered unnecessary to provide for increase of rent in
Schedule IV. I am, therefore, of the opinion that it is not possible on these
grounds to hold that s.7-A and Schedule IV are unconstitutional.
The learned counsel then brought to our
notice two other matters in which the newly constructed buildings have been
treated differently from the old buildings. He pointed out that under para
10(2) of Schedule IIV the standard rent fixed by Rent Controller must
necessarily be retrospective in effect while under s.7(5) the Court can fix the
date from which the payment of Estandard rent would become effective. He
further pointed out that under s. 4(2) a landlord on making improvements can
increase the standard rent by an amount not exceeding 61 per cent of the cost
of improvement, while under para 6 of the Schedule IV the Rent Controller can
increase the standard rent in such circumstances to an amount not exceeding
7-1/2 per cent of the cost of improvement.
These are, however, no grounds for holding
the impugned provisions to be unconstitutional.' The Delhi and Ajmer-Marwara Rent
Control Act, 1947, came into force on 24-31947 originally for two years only
and s.7-A with Schedule IV were introduced in September 1947. Therefore the
standard rent for new buildings could well be fixed from the beginning of the
lease. The old buildings were let long before 1947 and, therefore, it was
considered advisable to leave it to courts to fix the date from which the
payment of standard rent would become effective.
This is a rational difference. So is the
Matter of difference of return on the cost of 967 improvements. There is no
reason for equating the return on cost of improvements of old buildings with
the return oil' the cost of improvements of new buildings. This is a matter for
the legislature to consider and this possible slight difference, in returns
cannot be said to be discriminatory and violative of Article 14 of the
For these reasons I am of the opinion that
the criteria for the fixation of standard rent for new and old buildings is
substantially the same and does not violate Article 14 of the Constitution and
there is no valid reason for coming to the conclusion that the standard rent of
old and new buildings of the same type and in the, same locality would
necessarily be different. The first ground, therefore, fails and rejected.
The second ground also has no force. It is
urged that in Schedule TV there is no provision for recording the evidence of
the parties nor is it laid down whether the evidence is to be on oath. It is
futher urged that the principles of natural justice have been disregarded by
Schedule IV and it is open to the Rent Controller to fix standard rent
arbitrarily without recording any evidence.
Now para 2 Schedule IV says that the Rent
Controller shall make such enquiry as he considers fit to fix the standard
x x x x x In fixing standard rent the Rent;
Controller decides a dispute between a landlord and a tenant. To do this
effectively he has to take evidence and to hold a judicial inquiry particularly
when he has to give reasons for his decision. Para 7 is also indicative of such
a judicial. inquiry. There is no reason for Presuming and assuming that the 968
Rent Controller would not hold s a oh an inquiry. If he does" not do go
then the aggrieved party can always appeal to the District Judge, Delhi who
invariably is a very senior and experienced judicial officer.
x x In this context it must not be forgotten
that considering the' recent rise in prices of land, building material and
labour costs in Delhi the standard rent should be correlated to these costs. In
the circumstances the legislature in its wisdom has thought fit that the
enquiry, into standard. rent. of new building should continue to remain with
the Rent Controllers who can expeditiously decide the matter.
In this context it can be reasonably expected
that the Central Government will appoint only those persons as Rent Controllers
who can use:
their own knowledge and experience to
calculate these costs. In these circumstances it cannot be said that the
differentiation in the procedure adopted in the statute has no rational
relation to the, object sought 'by the legislature.
We agree with these observations of the Full
Bench, and we further accept the view expressed by it that the criteria for the
fixation of standard rent for both new and. old buildings under the Control
Act, 1947 are not substantially different. The minor differences that exist in
the matter, which have been adverted to in the judgment of the High_ Court, can
be justified on the grounds of (a) difference in the. cost of construction of
old and new buildings, (b) difference in the rate of return on investments made
in building houses before and after 1947(c) the need to encourage the, building
of houses to meet the acute shortage of 969 accommodation in Delhi after 1947,
and (d) the opportunity presented of charging excessive tent after 1947.
Perhaps, it is also necessary to emphasise again that the provisions in
Schedule IV of the Control Act, 1947, do not give an arbitrary power to the
Rent Controller. Paragraph 3 of the.
Schedule requires the Rent Controller to
state 'in writing his reasons for fixing the standard rent. Paragraph 4 states
that in fixing the standard rent, the Rent Controller shall take into
consideration all the circumstances of the case including any amount paid or to
be paid by the tenant by way of premium or any other like sum in addition to
Paragraph 7 gives the Rent Controller power
to require the landlord to produce any book of account, document or other
information relating to the newly constructed premises, to enter and inspect
such premises after due notice, and to authorise any officer subordinate to him
to enter and inspect any such premises after due notice. Paragraph. II provides
for an appeal to the District Judge by any person aggrieved by an order of the
Rent Controller. These provisions clearly indicate that the power given to the
Rent Controller is not an arbitrary power. The power has to be exercised by the
Rent Controller on a judicial consideration of all the circumstances of the
case. We think that the High Court was in error in the view it expressed that
no reasonable procedure is prescribed by the provisions of Schedule IV and the
Rent Controller is at liberty to do whatever he likes.
This brings us to the main question for
decision in these appeals-was there a violation of the principles of natural
justice in the procedure which the Rent Controller actually followed in fixing
the standard rent ?'We are unable to agree with the High Court that there, was
any. such violation. On behalf of the landlord, it has been contended before us
that in respect of both the matters 970 completion of construction of the
building and fixation of standard rent, the Rent Controller proceeded on (i)
private enquiries, (ii) local inspection without notice, and (iii) inadmissible
evidence. Before we deal with this argument, it is necessary to say a few words
about the principles of natural justice. This Court considered the question in
New Prakash Transport Co., Ltd. v. New Suwarna Transport Co., Ltd. (1). After a
review of the case law on the subject, it pointed out that the rules of natural
justice have to be inferred from the nature of the tribunal, the scope of its
enquiry and the statutory rules of procedure laid down by the law for carrying
out the objectives of the statute. The mere circumstance that the procedure
prescribed by the statute does not require that evidence should be recorded in
the manner laid down for ordinary courts of law does not necessarily mean that
there is a violation of the principles of natural justice. In Union of India v.
T. R. Varma (2) this Court said "Stating it broadly and without intending
it to be exhaustive, it may be observed that rules of natural justice require
that a party should have the opportunity of adducing all relevant. evidence on
which he relies, that the evidence of the opponent should be taken in his
presence, and that he should be given the opportunity of cross-examining the
witnesses examined by that party, and that no materials should be relied on
against him without his being given an opportunity of explaining them. If these
rules are satisfied, the enquiry is not open to attack on the ground that the
procedure laid down in the Evidence Act for taking evidence was not strictly
followed." Judged in the light of the observations referred (1) (1957) S.
C. R. 98.
(2) (1958) S. C. R. 499) 507.
971 to above, was there a violation of the
principles of natural justice in the cases under our consideration? We have
pointed out earlier that the landlord was repeatedly given an opportunity of
producing such evidence as he wished to produce. On August 12, 1948 be was
asked to bring all relevant records including account books, vouchers etc. He
did not, choose to do so. He asked for an. adjournment which was granted to
him. On September 1, 1948 the landlord again asked for time. This was also
granted to him and he was told that the cases would be finally heard on
November 17,1948, He was also informed that no further adjournment would be
given. It appears from the record that on September 1, 1948 some statements
were recorded in the presence of the representative of' the landlord. On
November 19, 1948 which ",as the date fixed for final hearing, the
landlord again asked for time and time was again granted to him. On December 3,
1948 the landlord was told that the Rent Controller would inspect the house
on..Sunday December 5, 1948 between 9 A. m. and 1 P. m. The landlord was asked
to be present. On December 3 the Advocate of the landlord was present and was
informed that the landlord must submit his written statement in writing within
15 days. The Advocate, however, gave an application for postponement of the
cases on the ground that certain proceedings were pending before the
Subordinate Judge, Delhi. On December 9, 1948 the landlord was again given one
A week's time to file his written statement and produce such other evidence as
he wished to produce. In these circumstances it is difficult to understand how
the landlord can complain that there has been a violation of the principles of
natural justice and that he had no opportunity of producing evidence or of
cross-examining the witnesses whose statements were recorded by the Rent
Controller. It, is indeed true that the Rent Controller made some local enquiries
when he inspected the building on December 12, 1948. If, however, 972 the
landlord chose to be absent in spite of repeated intimation to him, he cannot
be heard to say that the enquiries were made in his absence and are, therefore,
To bold in such circumstances that there has
been a violation of the principles of natural justice would be to put a premium
on the recalcitrance of a party. Even in the ordinary courts of law, if a party
chooses to be absent in spite of notice, evidence is recorded ex-parte and the
party who chooses to be absent cannot be heard to say that he had no
opportunity of being present or of cross-examining the persons whose statements
were recorded by the court. After all, what natural justice requires is that a
party should have the opportunity of adducing all relevant evidence and that he
should have an opportunity of the evidence of his opponent being taken in his
presence. Such an opportunity was clearly given to the landlord in the present
cases. If anybody is to blame for the ex-parte order of the Rent Controller, it
is the landlord himself. It appears from the order of Rent Controller that the
attorney or advocate of the landlord did appear on several dates and even made
a statement as. to the letting out of the building in question but. took no
other 'part in the proceeding except asking repeatedly for adjournment. The
Rent Controller was not far wrong when he said that the landlord was bent upon
avoiding a trial of the issue before the Rent Controller on the ground that be
had made applications under s. 7 to the Subordinate Judge, Delhi, for fixation
of' standard rent.
In view of the recalcitrant attitude which
the landlord adopted the Rent Controller did his best in the circumstances. He
took into consideration such relevant circumstances as the cost of the, land,
cost of construction, cost of fittings, the open. area in front of the shops,
cost of repairs etc.. The learned District Judge also took in to consideration
the return which the landlord could:.-reasonably expection his outlay and also.
the rent of other premises in the. area. Taking these 973 additional
circumstances into consideration, the District Judge doubled the standard rent
which the Rent Controller had fixed. 'It does, not appear from the order of the
learned District Judge that any objection was pressed before him on the ground
that in the actual proceedings. before the Rent Controller there was a
violation of' the principles of natural justice, though in paragraph 7 of the
grounds of appeal it was stated that the procedure adopted by the Rent
Controller was contrary. to the provisions of law etc. A ground appears to have
been seriously pressed for the first time I in the revision applications to the
Some grievance has been made before us of the
circumstance that in his letter dated December 3, 1948 the Rent Controller said
that be would inspect the building on December 5,1948. He however, actually
inspected the building oh December 12, 1948 as his order shows. Our attention
has been drawn to para 7 (b) of So 'IV and it has been contended that the
inspection was made without notice to the landlord'. This, it is stated, has.
vitiated the entire proceedings. This argument might have had some force, but
for the attitude adopted throughout the proceedings by the landlord. On the
very date on which the, Rent Controller intimated to the landlord that he would
visit the building on December 5, 1948, the landlord sent a telegram purporting
to be on his behalf stating that he was out of, station. The Rent Controller
then noted an order on that very date stating that the advocate for the
landlord gave an application for staving the proceedings. The application was
rightly refused by the Rent Controller. In these circumstances we do not think
that the landlord can make any complaint that the inspection was without notice
or that he had, no opportunity of being present at the time of the inspection.
It is obvious that from the very beginning the landlord had taken up an
attitude of non-co-operation in the proceedings before the 974 Rent Controller.
It is worthy of note that even in statement of the case in this Court, the
landlord has made no. grievance that the inspection was held without notice to
him; nor did he take any such plea before the District Judge.
A further contention urged on behalf of the
landlord arises out of para 2 of Sch. IV That paragraph says that if the Rent
Controller "has reason to believe that the rent of any newly constructed
premises is excessive, he may after making such enquiry as he thinks fit,
proceed to fix a standard rent thereof". The argument before us is that
before proceeding to fix the standard rent the Rent Controller did not bold a
preliminary enquiry nor did be record a finding to the effect that the rent
charged by the landlord was excessive ; therefore., the provisions of para 2
were violated. We do not think that there is any substance in this contention.
In the, application which 9 tenants made on July 30, 1948 they definitely
stated that under the stress of circumstances resulting from a partition of the
country and the heavy demand for business premises in Delhi, they were forced
to accept the excessive and exorbitant rent which the landlord was charging
from them. On this application a note was recorded by the Rent Controller's
office to the effect that the entire case relating to the fixation of standard
rent for the building in question was already under consideration, presumably
because, other tenants had also made similar applications. The Rent Controller
thereupon recorded an order which said that "in order to fix the rent of
the premises in accordance with s. 7A of the Control Act, 1947 a summary
enquiry would be held by him".
It is obvious from this order that the Rent
Controller was prima facie satisfied that the rent charged was excessive and
action was required under s.7A of the Control Act, 1947.
The argument urged. on behalf of the landlord
really comes to this, viz. that under para 2 of Sch. IV there must always be'
two 975 enquiries, first an enquiry as to whether there are reasons to believe
that the rent charged is excessive and, secondly, an enquiry for fixing the
standard rent. We do not think that para 2 necessarily involves two enquiries
in all circumstances. In a case where the Rent Controller has a written
complaint, as in these cases, the complaint itself may give reasons which the
Rent Controller may prima facie accept that the rent charged by the landlord is
In the cases before us the tenants had stated
the reasons, which were common to all, why they had to submit to excessive and
exorbitant rate of rent charged by the landlord. It was, we think, open to the
Rent Controller to accept those reasons as prima facie good reasons for
proceeding to make an enquiry to fix the standard rent in that enquiry it was
open to the Rent Controller to give the necessary finding that the rent charged
by the landlord was excessive. The final order of the Rent Controller shows without
doubt that he was satisfied that the rent charged by the landlord was
exorbitant and excessive. We are unable to hold that in these circumstances
there has been any contravention of para 2 of Sch. IV of the Control Act, 1947.
Another objection taken by the landlord to
the proceedings before the Rent Controller arises out of the circumstance that
the Rent Controller in fixing the standard rent for the entire building had
fixed the rent even for vacant shops i.e. shops which were not in occupation of
any tenant at the time. In the final order which the Rent Controller passed, he
fixed the standard rent for all the shops at RS. 335/per month and in the
calculation sheet, which was part of the final order made by the Rent
Controller on January 11, 1949, three shops have been shown to be vacant. It
has been contended before us that the Rent Controller had not jurisdiction to
fix the standard rent for vacant shops and the argument is that the way he
proceeded to fix 976 the rent for the entire building vitiated the proceedings
before him. It has further been argued that only 9 tenants, six of whom are
appellants before us, applied for the fixation of standard rent on July 30,
1948. Therefore, the Rent, Controller had no jurisdiction to fix the standard
rent in respect of persons who had not applied for such fixation. It has been
contended before us that in six of the appeals before us (viz. Civil Appeals
Nos. 176, 178, 181, 189, 183 and 184 of 1958) the appellants had made no
application for fixation of standard rent.
We take up first the question of vacant
shops. It is clear from s.7A and the provisions of Sch. IV that the Rent
Controller has to fix, the standard rent of newly constructed
"premises" if the condition stated in para 2 of Sch. TV is satisfied.
The word "Premises" as defined in s.2 of the Act means "any
building or, part of a building which is, or is intended to be, let separately
for use as a residence or for commercial use or for any other purpose
etc." Each shop let out or intended to be let out separately is therefore
"premises" within the meaning of the Control.
Act, 1947. It may, therefore, be correct to
say that it was not necessary for the Rent Controller to fix the standard rent
for vacant shops. It is obvious, however, that for shops which had been let out
to tenants the Rent Controller had to take into consideration the cost of the
entire building, value of the land, the fittings etc. In other words he had to
take the entire building into consideration for the purpose of fixing the
standard rent of the shops in the building let out to various tenants. That
being the position, we do not consider that the proceedings before the Rent
Controller were rendered abortive merely because the Rent Controller also fixed
the standard rent for some of the vacant shops. For the purpose of these
appeals, the standard rent fixed for the vacant shops may well be ignored: that
will not 977 affect the rent fixed for the shops which had been let out to
As to the point that some of the appellants
had made, no application for fixation of standard rent, we are unable to accept
the contention as correct. It is indeed true that 9 tenants had made an
application for fixation of standard rent on July 30, 1948, but it appears that
there were other applications also from other tenants. This is clear from the
office note, to which we have already referred earlier, appended to the
application of 9 tenants. Moreover the application which the landlord himself
had made on September 1, J948 showed that 14 tenants had made applications for
the fixation of standard rent of their shops in Chemists' Market in Bhagirath
Colony. Unfortunately, all the applications have not been printed in the paper
book. The order of the Rent Controller shows that he treated all the
applications as' though they gave rise. to a single proceeding, because they
related to the same building. This point which has now been taken before us
does not appear to have been taken before the District Judge who said that
there were 19 appeals before him arising out of a single order of the Rent
Controller fixing rent for 18 different shops of a building belonging to the
landlord. In the calculation sheets which the Rent Controller and the learned
District Judge had prepared and which give the names of all the tenants the
standard rent for whose shops was. fixed, are shown the names of all the
appellants. It is, me think, too late in the day for the landlord to contend
that some of the appellants had not applied for the fixation of standard rent,
In any view of the matter, the landlord has not placed sufficient materials before
us in support of that contention. We may point out here. that M/s. Narang
Medicine Co., appellant in Civil Appeal No. 182 of 1958, did not join in the
application made on July 30, 1948. Yet we find from the 978 record that a copy
of the letter which the Rent Controller wrote to the landlord on November 9,
1948, was sent to M/s. Narang Medicine Co. As we have earlier pointed out the
very petition of the landlord dated September 1, 1948, shows that many more
than 9 tenants had applied for fixation of standard rent for their shops in
Chemists' Market, Bhagirath Colony. Therefore, we are unable to uphold the'
contention of the landlord that the Rent Controller had fixed the standard rent
of some of the shops, tenants whereof had not applied for the fixation of the
This concludes the discussion with regard to
the Chemists' Market in Bhagirath Colony. In these appeals we have come to the
conclusion, for reasons given above, that the High Court was wrong in
interfering with the order of the District Judge in appeal. We would,
;therefore, set aside the order of the High Court dated August 26, 1954 and
restore that of the learned District Judge in appeal, so far as the appellants
herein are concerned.
Civil Appeals Nos. 185 and 186. of 1958.
We now turn to the two appeals relating to
The two tenants are M/s. Dhawan & Co.,
and Firm Gokal Chand-Madan Chand. M/s. Dhawan & Co. had made ,in
application for fixation of standard rent on June 14, 1948.
A Similar application was made by Firm Gokal
Chand Madan Chand on the same date. In the applications an averment was made
that the flats were completed after March 24, 1947, and that the tenants being
without any accommodation and under the pressure of circumstances were forced
to accept the exorbitant rent of Rs. 360 per month in one case and Rs. 350 per
month in the other. Both of them asked for fixation of standard rent under s.7A
of the Control Act, 1947. Both the landlord and the tenants appeared before the
Rent Controller and 979 made statements before him. The main question taken
before the Rent Controller on behalf of the landlord was that the second-floor
on which the two flats of the tenants were situated ",as completed before
March 24, 1947, and therefore, no proceeding in respect thereof was
maintainable under s.7A of the Act. The Rent Controller %vent into the evidence
adduced before him very carefully and came to the conclusion that though the
ground-floor and the first-floor of the building were old, the second-floor was
constructed some time. in August, 1947. He, therefore, held that the
second-floor was a new construction within the meaning of s.7A of the Control
Act, 1947 and be fixed the standard rent for each flat at Rs. 96-8-0. The
matter was then taken in appeal to the District Judge. Again the main
contention before the District Judge was that the Rent Controller bad no
jurisdiction as the premises in question were not newly constructed. The
District Judge dealt with this point in the following way:
"The premises, are two flats on the
second floor of a large building belonging to the appellant, and the rent
Controller has found that these flats were constructed after 24th March, 1947.
The record shows that the general attorney for the appellant admitted before
the Rent Controller that only a temporary construction was in existence on the
second floor before 24th March 1947, and that temporary construction consisted
of wooden purlins with corrugated iron sheets and stoneslabs on top of them.
Subsequently, however, this construction was brought down and proper flats were
built with reinforced concrete roofs, and it is in evidence that the first
tenant, who occupied one of the flats, did so in September, 1947, and a second
tenant went into occupation in January, 1948. It is on.
this evidence abundantly clear that 980 the
premises or the flats now in dispute were in every sense newly constructed
premises and the, Rent Controller was competent to fix the rent." It is
clear from the orders of the Rent Controller and of the District Judge in
appeal that the question whether the second floor was newly constructed or not
was really a question of fact, though undoubtedly a jurisdictional fact on
which depended the power of the Rent Controller to take action under s.7A. If
the Rent Controller had wrongly decided the fact and assumed jurisdiction where
he had none, the matter would be open to reconsideration in revision.
The High Court did not, however, go into the
evidence, nor did it say that the finding was not justified by the evidence on
record. The High Court referred merely to certain submissions made on behalf of
the landlord and then expressed the opinion that what was done to the second
floor was mere improvement and not a new construction. We think that the High
Court was in error in interfering with the finding of fact by the Rent
Controller and the District Judge, in support of which finding there was clear
and abundant evidence which had been carefully considered and accepted by both
the Rent Controller and the District Judge.
In these two appeals we have come to the
conclusion that the judgment of the High Court dated January 26, 1954, should
be set aside and that of the District Judge restored. We may here note that so
far as the standard rent fixed by the Rent Controller was concerned, the
District Judge himself noted that the learned advocate for the landlord was not
able to find any fault with the assessment made by the Rent Controller.
Civil Appeal No. 171 of 1958.
We now come to Civil Appeal No. 171. The
facts of this appeal are somewhat different. We 981 have already stated that
this appeal relates to two flats on the ground floor of plot No. 20, Block No.
13, Western Extension Area, Karolbagh. The tenant, who is the appellant before
us, took the flats on a rent of Rs. 220 per month including tax on December
15,1950. On May 15, 1951 he made an application for fixation of standard rent
under s.7A of the Control Act, 1947, on the ground that the rent charged was
excessive and exorbitant. The application was contested by the landlord. On
December 7, 1951, the Rent Controller fixed Rs. 150 per month as the standard
rent inclusive of tax. The landlord filed an appeal to the District Judge Which
was dismissed on May 12, 1953. The landlord then filed an application in
revision to the High Court and the High Court accepted the application on May
10, 1954, and remanded the case for afresh trial. When the case came back to
the Rent Controller, the landlord made an application to the Rent Controller to
the effect that s.7A read with Schedule IV of the Control Act.' 1947, was
rendered unconstitutional and void on the coming into force 'of the
Constitution of India. Apparently, this point was taken in view of the judgment
of the Punjab High Court dated August 26, 1954, already discussed in the other
appeals. On May 30, 1955, the Rent Controller held, on the basis of the
aforesaid decision, that S. 7A read with Schedule IV of the Control Act, 1947,
was unconstitutional and therefore the application was not maintainable
Accordingly, he dismissed the application. The matter was then taken to the
District Judge in appeal. The learned District Judge who was bound by the
decision of the Punjab High Court also held that s.7A of the Control Act, 1947,
was unconstitutional and therefore the application was not maintainable. The
tenant-appellant then made an application under Art. 227 of the Constitution to
the Punjab High Court. That application was summarily dismissed on March
7,.1956, 982 We have already dealt with the constitutional point as to whether
s.7A read with Sch. IV of the Control Act, 1947 is, void after the coming into
force of the Constitution of India by reason of a violation of the fundamental
right guaranteed under Art. 14 of the Constitution and we have come to the
Conclusion that s.7A and the relevant provisions of Sch. IV of the Control Act,
1947 are not unconstitutional. That being the position, the main ground on
which the application of the appellant was dismissed disappears and the
application must now be dealt with in accordance with law. Our attention has,
however, been drawn to the Delhi and Ajmer Rent Control Act, 1952 (Act No.,
XXXVIII of 1952), which by s.46 repealed the Control Act, 1947. That section,
however, contains a saving clause which is as follows :
"46. Repeals and savings.(1) x x x
(2)Notwithstanding such repeal, all suits and other proceedings pending at the
commencement of this Act, whether before any court or the Rent Controller
appointed under the Fourth Schedule to the said Act, shall be disposed of in accordance
with the provisions of the said Act as if the said Act bad continued in force
and this Act had not been passed :
Provided that the procedure laid 'down in
this Act shall, as far as may be, apply to suits and other proceedings pending
before an Court." We consider it unnecessary to determine the effect of
the aforesaid saving clause in the present appeal. Neither the Rent Controller,
nor the District Judge, nor the High Court considered the effect of the saving
clause. The, application of the appellant was dismissed on the simple ground
that s.7A read with Sch. TV of the Control Act, 1947 was unconstitutional. We
consider that that ground is not 983 correct and the application of the tenant
appellant for fixation of standard rent must now be deter-. mined in accordance
with law. It would be for the competent authorities to consider now the effect
of s.46 of the Delhi and Ajmer Rent Control Act, 1952 or of any other law
bearing on the question which may have come into existence since then.
We, would, therefore, allow this appeal and
set aside the orders of the Rent Controller, the District Judge and the High
Court dismissing the application of the appellant. The application must now be
dealt with in accordance with law by the authority competent to do so in the
light of the observations made above.
In the result the appeals in all three
categories are allowed as indicated above. The appellants in all the appeals
will be entitled to their costs, but there will be one set of hearing fee for
each of the three categories of appeals.