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Ram Krishan Grover vs Union Of India on 14 November, 2019

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 8597 OF 2019
(ARISING OUT OF SPECIAL LEAVE PETITION (CIVIL) NO. 26925 OF 2011)

RAM KRISHAN GROVER AND OTHERS ….. APPELLANT(S)

VERSUS

UNION OF INDIA AND OTHERS ….. RESPONDENT(S)

WITH

CIVIL APPEAL NO. 8598 OF 2019
(ARISING OUT OF SPECIAL LEAVE PETITION (CIVIL) NO. 28107 OF 2011)

CIVIL APPEAL NO. 8599 OF 2019
(ARISING OUT OF SPECIAL LEAVE PETITION (CIVIL) NO. 28371 OF 2011)

CIVIL APPEAL NO. 8600 OF 2019
(ARISING OUT OF SPECIAL LEAVE PETITION (CIVIL) NO. 28593 OF 2011)

CIVIL APPEAL NO. 8601 OF 2019
(ARISING OUT OF SPECIAL LEAVE PETITION (CIVIL) NO. 31284 OF 2011)

CIVIL APPEAL NO. 8602 OF 2019
(ARISING OUT OF SPECIAL LEAVE PETITION (CIVIL) NO. 2091 OF 2012)

CIVIL APPEAL NO. 8603 OF 2019
(ARISING OUT OF SPECIAL LEAVE PETITION (CIVIL) NO. 34304 OF 2012)

CIVIL APPEAL NO. 8604 OF 2019
(ARISING OUT OF SPECIAL LEAVE PETITION (CIVIL) NO. 17458 OF 2013)

Signature Not Verified
AND
Digitally signed by
CHARANJEET KAUR
Date: 2019.11.14
16:27:12 IST

CIVIL APPEAL NO. 8605 OF 2019
Reason:

(ARISING OUT OF SPECIAL LEAVE PETITION (CIVIL) NO. 35980 OF 2013)

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JUDGMENT
SANJIV KHANNA, J.

Leave granted.

2. The afore-captioned appeals are by tenants of different residential

and non-residential buildings in the Union Territory of Chandigarh

and urban areas in the State of Punjab, who have challenged the

constitutional validity of Section 13-B of the East Punjab Urban

Rent Restriction Act, 1949 (for short, the ‘Rent Act’) and its

extension to the Union Territory of Chandigarh by the Central

Government vide Notification dated 09.10.2009 in exercise of

powers under Section 87 of the Punjab Reorganisation Act, 1966

(for short, the ‘Reorganisation Act’).

3. Section 13-B of the Rent Act, reads as under:

“13-B. Right to recover immediate possession of
residential building or scheduled building and/or
non-residential building to accrue to Non-resident
Indian.— (1) Where an owner is a Non-Resident
Indian and returns to India and the residential building
or scheduled building and/or non-residential building,
as the case may be, let out by him or her, is required
for his or her use, or for the use of any one ordinarily
living with and dependent on him or her, he or she,
may apply to the Controller for immediate possession
of such building or buildings, as the case may be:

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Provided that a right to apply in respect of such a
building under this Section, shall be available only after
a period of five years from the date of becoming the
owner of such a building and shall be available only
once during the life time of such an owner.

(2) Where the owner referred to in sub-section (1), has
let out more than one residential building or scheduled
building and/or non-residential building, it shall be open
to him or her to make an application under that sub-
section in respect of only one residential building or
one scheduled building and/or one non-residential
building, each chosen by him or her.

(3) Where an owner recovers possession of a building
under this Section, he or she shall not transfer it
through sale or any other means or let it out before the
expiry of a period of five years from the date of taking
possession of the said building, failing which, the
evicted tenant may apply to the Controller for an order
directing that he shall be restored the possession of the
said building and the Controller shall make an order
accordingly.”

The expression ‘Non-Resident Indian’ has been defined in

clause (dd) to Section 2 of the Rent Act and reads:

“(dd) “Non-resident Indian” means a person of Indian
origin, who is either permanently or temporarily settled
outside India in either case –

(a) for or on taking up employment outside India; or

(b) for carrying on a business or vocation outside
India; or

(c) for any other purpose, in such circumstances,
as would indicate his intention to stay outside India
for an uncertain period;”

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Section 13-B of the Rent Act gives a right to Non-Resident

Indians to recover immediate possession of residential/

scheduled/non-residential buildings situated in the Union Territory

of Chandigarh and urban areas in the State of Punjab on the

satisfaction of the conditions stated. We shall elaborate the

provisions subsequently and would first refer to the legislative

history and procedure adopted for enforcement of the challenged

provisions in the Union Territory of Chandigarh.

4. In 1956, the unified State of Punjab was created by merging the

erstwhile States of Pepsu and Punjab. In 1966, a new State of

Haryana was created and carved out of certain territories from the

State of Punjab. Certain hill areas of Punjab were merged in the

Union Territory of Himachal Pradesh. A new Union Territory of

Chandigarh was created and became the joint capital of Punjab

and Haryana. The Reorganisation Act, that is, the Punjab

Reorganisation Act, 1966 gave effect to the proposals vide

provisions relating to the delimitation of territories. Another

important aspect of the Reorganisation Act dealt with the

applicability of laws in territories that had undergone

reorganisation. This was effected by Part X of the Reorganisation

Act comprising of Sections 86 to 97. Sections 87, 88 and 89 of the

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Reorganisation Act are relevant for the present decision and are

reproduced below:

“87. Power to extend enactments to Chandigarh – The
Central Government may, by notification in the Official
Gazette, extend with such restrictions or modifications as
it thinks fit, to the Union territory of Chandigarh any
enactment which is in force in a State at the date of the
notification.

88. Territorial extent of laws.—The provisions of Part II
shall not be deemed to have effected any change in the
territories to which any law in force immediately before
the appointed day extends or applies, and territorial
references in any such law to the State of Punjab shall,
until otherwise provided by a competent legislature or
other competent authority, be construed as meaning the
territories within the State immediately before the
appointed day.

89. Power to adapt laws.—For the purpose of facilitating
the application in relation to the State of Punjab or
Haryana or to the Union Territory of Himachal Pradesh or
Chandigarh of any law made before the appointed day,
the appropriate Government may, before the expiration of
two years from that day, by order, make such adaptations
and modifications of the law, whether by way of repeal or
amendment, as may be necessary or expedient, and
thereupon every such law shall have effect subject to the
adaptations and modifications so made until altered,
repealed or amended by a competent legislature or other
competent authority.”

We shall subsequently elucidate on the sections, with

specific reference to Section 87 of the Reorganisation Act.

5. Territories originally comprised in the former province of East

Punjab and later designated as the State of Punjab were

governed by the Rent Act, which applied to all “urban areas”
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defined in Section 2(j) as any area administered by a municipal

committee, a cantonment board, a town committee or an area

notified by the State Government as an “urban area” for the

purposes of the Rent Act.

6. Central Government in exercise of power under Section 89 of the

Reorganisation Act had issued the Punjab Reorganisation

(Chandigarh) (Adaptation of Laws on State and Concurrent

Subjects) Order, 1968 with effect from 1.11.1966 whereby in all

the “existing laws” in its application to the Union Territory of

Chandigarh, any reference to the State of Punjab should be read

as a reference to the Union Territory of Chandigarh. The

expression “existing laws” was defined in para 2(1)(b) of the

Order. It is an accepted position that the Rent Act was not a part of

the “existing laws” as the area forming the Union Territory of

Chandigarh was not an “urban area” within the Rent Act.

7. The Central Government by Notification dated 13.10.1972 and

published in the Official Gazette on 04.11.1972 had declared the

area comprising of the Union Territory of Chandigarh to be an

“urban area” for the Rent Act. This Notification was struck down by

the Punjab and Haryana High Court in Harkishan Singh v. Union

of India1, on the short ground that no notification extending the
1 AIR 1975 Punj. Har 160 (FB)
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Rent Act to the Union Territory of Chandigarh as an “urban area”

under Section 2(j) of the Rent Act could have been issued post

reorganisation on 1.11.1966. The Rent Act was not operative in

Chandigarh in terms of Section 88 of the Reorganisation Act nor

any part would become operative by a notification under Section

87 without necessary adaptation. Thus, neither the Order nor the

Notification dated 13.10.1972 could have the effect of making the

Rent Act applicable to the Union Territory of Chandigarh.

8. The Parliament had thereupon to rectify the defect exercised its

power under Article 246(4) of the Constitution by enacting the East

Punjab Urban Rent Restriction (Extension to Chandigarh) Act,

1974 (for short, the ‘Extension Act’) to extend the Rent Act, subject

to modification specified in the Schedule, to the Union Territory of

Chandigarh. This enactment had stipulated that the Rent Act

would be deemed to be in force from 04.11.1972, that is the day

on which the earlier Notification that was quashed in Harkishan

Singh’s case (supra), was made effective. Thereby all

proceedings for eviction initiated in view of the Notification dated

04.11.1972 were regularised. The Extension Act was in principle

and substance a Parliamentary enactment to incorporate by

reference and to avoid repetition all the provisions of the Rent Act

to the Union Territory of Chandigarh.

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9. On 17.12.1976, when the Parliament was not in session, the

President had promulgated Ordinance 14 of 1976 by which the

Rent Act was amended by the introduction of an Explanation and

addition of sub-section (4A) to Section 13 and sub-section (2A) to

Section 19. New sections 13A, 18A and 18B were inserted and in

Schedule II the form of summons to be issued under Section 13A

was added. This Ordinance was allowed to lapse and was not

enacted as law thereafter.

10. In 1982, the Parliament passed the East Punjab Rent Restriction

(Chandigarh Amendment) Act replacing the words “East Punjab”

with the word “Punjab” and by substituting the definition of “non-

residential building” in the Rent Act as applicable to Chandigarh.

Lapsed amendments to the Rent Act vide Ordinance 14 of 1976

were not incorporated.

11. In 1985, the provisions of the Rent Act as applicable to the State

of Punjab were amended by the Legislature of the State of Punjab

vide Punjab Act 2 of 1985 by inserting new Sections 13A, 18A and

18B, a new Second Schedule and amendments in Sections 13

and 19 substantially similar to those that had been effected by

Ordinance 14 of 1976. A new definition of “specified landlord” was

also added. These amendments came into force on 16.11.1985.
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12. Central Government thereafter issued Notification dated

15.12.1986 purportedly in exercise of the power under Section 87

of the Reorganisation Act extending the provisions of the Punjab

Act 2 of 1985, subject to the modifications mentioned therein, to

the Rent Act applicable to the Union Territory of Chandigarh, that

is, the Extension Act.

13. The extension whether permissible by means of a notification

issued under Section 87 of the Reorganisation Act was

challenged, but rejected by this Court in Ramesh Birch v. Union

of India2. We shall subsequently refer to this judgment.

14. The provision under challenge before us, namely Section 13-B

was inserted in the Rent Act vide East Punjab Urban Rent

Restriction (Amendment) Act, 2001 (for short, the ‘Amendment

Act’) as enacted by the State Legislature of Punjab. Section 13-B

and other related sections in the Amendment Act were extended

to the Union Territory of Chandigarh by the Central Government

vide Notification dated 09.10.2009 in purported exercise of powers

under Section 87 of the Reorganisation Act.

15. To avoid prolixity, we do not propose to refer to the factual matrix

as after hearing arguments we had declined to interfere on facts
2 1989 Supp (1) SCC 430
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and had heard arguments on legal issues that can be summarised

as under:

(i) The Notification dated 09.10.2009 which extends the

Amendment Act to Chandigarh by an executive action in

exercise of powers under Section 87 of the Reorganisation

Act amounts to and suffers from the vice of excessive

delegation as it amends the rent legislation in force in

Chandigarh, that is, the Extension Act were enacted by the

Parliament in exercise of powers under Article 246(4) of the

Constitution.

(ii) The State Legislature of Punjab was incompetent to enact

the Amendment Act, for the subject matter and rights of Non-

Resident Indians fall under the field of ‘Citizenship,

Naturalization and Aliens’ under Entry 17 of List I;

‘Extradition’ under Entry 18 of List I and ‘Admission into, and

Emigration and Expulsion from India; Passports and Visas’

under Entry 19 of List I of the Seventh Schedule. The

subject matter of legislation is in direct conflict with and

repugnant to various Central enactments concerning the

rights of Non-Resident Indians including the Citizenship Act,

1955 and the Foreign Exchange Management Act, 1999,

etc.

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(iii) Section 13-B which gives a preferential right to claim

eviction to Non-Residents, including foreigners, is arbitrary,

unreasonable and discriminatory, and creates an artificial

classification for benefit of Non-Residents vis-à-vis Indian

Residents and thus, violates Article 14 of the Constitution.

For the sake of convenience and clarity, we shall deal with

each of the respective submissions and give our reasons

separately.

A. Whether Notification dated 09.10.2009 issued under Section
87 of the Reorganisation Act extending Section 13-B of the
Rent Act to Chandigarh by executive action is invalid?

16. In Ramesh Birch (supra), earlier Constitutional Bench judgment

of this Court in Re Delhi Laws Act 1912, Ajmer Merwara

(Extension of Laws) Act, 1947 and Part C States (Laws) Act,

19503 was examined and elucidated after considering seven

different opinions of Kania, CJ., Fazl Ali, Patanjali Sastri, Mahajan,

Mukherjea, Das and Bose JJ. All the Judges except Kania, CJ.

and Mahajan, J. had upheld provisions of Section 7 of the Delhi

Laws Act, 1912, Section 2 of the Ajmer Merwara (Extension of

Laws) Act, 1947 and the first portion of Section 2 of Part C States

(Laws) Act. However, Bose and Mukherjea, JJ. had for reasons

3 AIR 1951 SC 332
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stated by them formed the majority with Kania, CJ. and Mahajan,

J. in striking down second part of Section 2 of Part C States

(Laws) Act, 1950 by which the executive had been given the

power to make a provision in any enactment so extended for the

repeal or amendment of any corresponding law (other than a

Central Act) which was for the time being applicable to that Part C

State. This part of Section 2, it was observed, suffers from the vice

of excessive delegation and abdication of power by the

Legislature. On the touchstone of an earlier decision of the Privy

Council in R. v. Burah4, this Court in Ramesh Birch (supra) had

upheld constitutional validity of Section 87 of the Reorganisation

Act, holding it to be valid on the ‘policy and guideline’ theory if one

has proper regard to the context of the Reorganisation Act and the

object and purpose sought to be achieved by Section 87 of the

Reorganisation Act. It was observed:

“23. But, these niceties apart, we think that Section 87 is
quite valid even on the “policy and guideline” theory if one
has proper regard to the context of the Act and the object
and purpose sought to be achieved by Section 87 of the
Act. The judicial decisions referred to above make it clear
that it is not necessary that the legislature should “dot all
the i’s and cross all the t’s” of its policy. It is sufficient if it
gives the broadest indication of a general policy of the
legislature. If we bear this in mind and have regard to the
history of this type of legislation, there will be no difficulty at
all. Section 87, like the provisions of Acts I, II and III, is a
provision necessitated by changes resulting in territories
coming under the legislative jurisdiction of the Centre.

4 (1878) 5 Ind App 178 (PC).

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These are territories situated in the midst of contiguous
territories which have a proper legislature. They are small
territories falling under the legislative jurisdiction of
Parliament which has hardly sufficient time to look after the
details of all their legislative needs and requirements. To
require or expect Parliament to legislate for them will entail
a disproportionate pressure on its legislative schedule. It
will also mean the unnecessary utilisation of the time of a
large number of members of Parliament for, except the few
(less than ten) members returned to Parliament from the
Union territory, none else is likely to be interested in such
legislation. In such a situation, the most convenient course
of legislating for them is the adaptation, by extension, of
laws in force in other areas of the country. As Fazl Ali, J.
pointed out in the Delhi Laws Act case [AIR 1951 SC 332 :
1951 SCR 747] it is not a power to make laws that is
delegated but only a power to “transplant” laws already in
force after having undergone scrutiny by Parliament or one
of the State legislatures, and that too, without any material
change. There is no dispute before us — and it has been
unanimously held in all the decisions — that the power to
make modifications and restrictions in a clause of this type
is a very limited power, which permits only changes that
the different context requires and not changes in
substance. There is certainly no power of modification by
way of repeal or amendment as is available under Section

89.”

17. Ramesh Birch (supra) had held that once a policy of extension of

the Rent Act is clear and permissible, it would seem only natural

as a necessary corollary that the executive should be permitted to

extend future amendments in the Rent Act to the Union Territory of

Chandigarh. After extensively examining the different judgments

and the views expressed in Re Delhi Laws Act (supra), the

notification was upheld with the following findings:

“31. There is certainly a good deal of force in these
arguments but we think that they proceed on an incorrect
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view of the effect of the notification impugned in the
present case. We might have been inclined to accept the
submissions of the learned Counsel had the effect of the
notification been to extend law which is in “actual conflict”
with any parliamentary enactment or which has the effect
of “throwing out” any existing law in the Union territory. To
borrow an expression used in an analogous context, we
would have considered the validity of the extension
doubtful had the extended provisions been repugnant to an
Act of Parliament in force in the Union territory. So long as
that is not the effect or result, we think, there is no reason
to construe the scope of Section 87 in the restricted
manner suggested by counsel. It is no doubt true that
Section 87 permits an extension because there is no law in
the Union territory in relation to a particular subject and
Parliament has not the requisite time to attend to the
matter because of its preoccupations. But this purpose
does not require for its validity that there should be no
existing law of Parliament at all on a subject. Again the
concept of “subject” for the purposes of this argument is
also an elastic one the precise scope of which cannot be
defined. The concept of vacuum is as much relevant to a
case where there is absence of a particular provision in an
existing law as to a case where there is no existing law at
all in the Union territory on a subject. For instance, if
Parliament had not enacted the 1974 Act but had only
enacted an extension of the Transfer of Property Act to
Chandigarh, could it have been said that a subsequent
notification cannot extend the provisions of the 1949 Act to
Chandigarh because the subject of leases is governed by
the Transfer of Property Act which has been already
extended and there is, therefore, no “vacuum” left which
could be filled in by such extension ? Again, suppose,
initially, a Rent Act is extended by Parliament which does
not contain a provision regarding one of the grounds on
which a landlord can seek eviction — say, one enabling
the owner to get back his house for reoccupation — and
then the Government thinks that another enactment
containing such a provision may also be extended, can it
not be plausibly said that the latter is a matter on which
there is no legislation enacted in the territory and that the
extension of the latter enactment only fills up a void or
vacancy ? Again, suppose the provisions of a general code
like, say, the Code of Civil Procedure are extended to the
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Union territory, should we construe Section 87 so as to
preclude the extension of a later amendment to one of the
rules to one of the orders of the CPC merely on the ground
that it will have effect of varying or amending an existing
law? We think it would not be correct to thus unduly restrict
the scope of a provision like Section 87. The better way to
put the principle, we think, is to say that the extension of
an enactment which makes additions to the existing law
would also be permissible under Section 87 so long as it
does not, expressly or impliedly, repeal or conflict with, or
is not repugnant to, an already existing law. In this context,
reference can usefully be made to the observations in Hari
Shankar Bagla [Harishankar Bagla v. State of M.P., (1955)
1 SCR 380] at p. 391, which seem to countenance the
“bypassing” of an existing law by a piece of delegated
legislation and to draw the line only at its attempt to repeal
the existing law, expressly or by necessary implication. In a
sense, no doubt, any addition, however small, does amend
or vary the existing law but so long as it does not really
detract from or conflict with it, there is no reason why it
should not stand alongside the existing law. In our view
Section 87 should be interpreted constructively so as to
permit its object being achieved rather than in a manner
that will detract from its efficacy or purpose. We may also
note, incidentally in legislative practice also, such
successive changes have been allowed to stand together.
Lachmi Narain v. Union of India [(1976) 2 SCC 953]
narrates how the Bengal Finance (Sales Tax) Act, 1941
extended to Delhi under Act III was subsequently amended
by Parliament Acts of 1956 and 1959 but was also sought
to be modified by various notifications from time to time.
These notifications were challenged on the ground that the
power to extend by notification could be exercised only
once and that the impugned notification did not merely
extend but also effected modifications of a substantial
nature in the Act sought to be extended. No contention
was, however, raised that after the intervention of
Parliament in 1956 and 1959 there could have been no
extension of the Bengal Act as it would have the effect of
adding to or varying the Parliamentary legislation
apparently because they could stand side by side with
each other. We, therefore, think that since the extension of
the 1985 Act only adds provisions in respect of aspects not
covered by the 1974 Act and in a manner not inconsistent
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therewith, the impugned notification is quite valid and not
liable to be struck down.”

18. The distinction between conditional legislation and delegated

legislation was explained by this Court in Vasu Dev Singh v.

Union of India5 in the following words:

“16. … The distinction between conditional legislation and
delegated legislation is clear and unambiguous. In a
conditional legislation the delegatee has to apply the law to
an area or to determine the time and manner of carrying it
into effect or at such time, as it decides or to understand
the rule of legislation, it would be a conditional legislation.
The legislature in such a case makes the law, which is
complete in all respects but the same is not brought into
operation immediately. The enforcement of the law would
depend upon the fulfilment of a condition and what is
delegated to the executive is the authority to determine by
exercising its own judgment as to whether such conditions
have been fulfilled and/or the time has come when such
legislation should be brought into force. The taking effect of
a legislation, therefore, is made dependent upon the
determination of such fact or condition by the executive
organ of the Government. Delegated legislation, however,
involves delegation of rule-making power of legislation and
authorises an executive authority to bring in force such an
area by reason thereof. The discretion conferred on the
executive by way of delegated legislation is much wider.
Such power to make rules or regulations, however, must
be exercised within the four corners of the Act. Delegated
legislation, thus, is a device which has been fashioned by
the legislature to be exercised in the manner laid down in
the legislation itself…

17. In Hamdard Dawakhana v. Union of India6 this
Court stated:

“The distinction between conditional legislation and
delegated legislation is this that in the former the
delegate’s power is that of determining when a
5 (2006) 12 SCC 753
6 AIR 1960 SC 554
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legislative declared rule of conduct shall become
effective; Hampton Co. v. U.S. and the latter involves
delegation of rule-making power which constitutionally
may be exercised by the administrative agent. This
means that the legislature having laid down the broad
principles of its policy in the legislation can then leave
the details to be supplied by the administrative
authority. In other words by delegated legislation the
delegate completes the legislation by supplying details
within the limits prescribed by the statute and in the
case of conditional legislation the power of legislation is
exercised by the legislature conditionally leaving to the
discretion of an external authority the time and manner
of carrying its legislation into effect as also the
determination of the area to which it is to extend;””

In the present case, the extension of the Amendment Act to

the Union Territory of Chandigarh falls within the ambit of

conditional delegation and is valid and permissible.

19. In light of the aforesaid decisions and for the same reasons as

stated in Ramesh Birch (supra), we would reject the first

contention raised by the appellants. Once a policy of extension of

laws has been laid down by the Parliament and is clear and

permissible, it would only seem as an inevitable fallout that the

executive should be permitted to extend future amendments to the

existing laws. Therefore, the challenge predicated on the doctrine

of excessive delegation, separation of powers, doctrine of the law

of agency, fails and must be rejected. Such challenge must also

be rejected in view of the large number of eviction suits filed by

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Non-Resident Indian landlords on the strength of Notification

dated 09.10.2009 who would be left remediless if contentions to

the contrary are accepted.

B. Whether amendments made vide the Amendment Act with
regard to the rights of Non-Resident Indians by the State
Legislature of Punjab were beyond its competence?

20. The contention that the Amendment Act enacted by the State

Legislature of Punjab has overstepped the jurisdiction assigned to

it or has encroached upon a forbidden field is determinable by

finding out the true nature and character or pith and substance of

the Amendment Act which turns upon construction of the entries in

the legislative Lists under the Seventh Schedule of the

Constitution.

21. Relevant entries from the three Lists which are germane to the

determination of nature and character of the Amendment Act are:

List I

Entry 17 – Citizenship, naturalisation and aliens.

Entry 18 – Extradition.

Entry 19 – Admission into, and emigration and expulsion

from, India; passports and visas.

List II

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Entry 18 – Land, that is to say, rights in or over land, land

tenures including the relation of landlord and tenant, and the

collection of rents; transfer and alienation of agricultural

land; land improvement and agricultural loans; and

colonization.

List III

Entry 6 – Transfer of property other than agricultural land;

registration of deeds and documents.

Entry 7 – Contracts including partnership, agency, contracts

of carriage, and other special forms of contracts, but not

including contracts relating to agricultural land.

Entry 13 – Civil procedure, including all matters included in

the Code of Civil Procedure at the commencement of this

Constitution, limitation and arbitration.

22. The entries in the three Lists are not mutually exclusive. Further,

the entries are fields of legislation that demarcate the area and

heads of legislation. Accordingly, they should receive the widest

construction unless their rigour and import need to be castrated by

competing entries and other parts of the Constitution.

Interpretation of each entry has to be fair and liberal so as to cover

all incidental and subsidiary matters which can reasonably be said
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to have been comprehended in it. The entries should not be

interpreted in a narrow and pedantic sense. “Pith and substance”

doctrine states that if the legislation is covered by an entry, that is,

it is within the permitted jurisdiction of the legislature, any

incidental encroachment in the rival field has to be disregarded.

Only when wide construction of an entry leads to heads-on-clash

with another entry in the same or different List, the principle of

harmonious construction applies to reconcile the conflict and to

give effect to each of them.

23. Repugnancy arises between a Central and a State Act when there

is a direct and irreconcilable conflict between the two enactments.

It is when there is an irreconcilable conflict between the two

legislations that the Central Legislation prevails by virtue of Article

254 of the Constitution. Such repugnancy or inconsistency is not

to be readily inferred as the entries in the three Lists permit

incidental encroachment. Consequently, every attempt must be

made to placate the conflict and only when and in case of

oppugnant clash, the Court should proceed to strike down the

legislation as trespassing beyond its legitimate and legal confines.

24. In Vijay Kumar Sharma and Others v. State of Karnataka and

Others7, this Court referring to the “pith and substance” doctrine
7 (1990) 2 SCC 562
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had held that a provision in a particular legislation in order to give

effect to its dominant purpose may incidentally encroach on the

same subject matter as covered by the provision of another

legislation. Such partial coverage of the same area in a different

context and to achieve a different purpose does not bring about

the repugnancy which is intended to be covered by Article 254(2).

Both the legislations must be substantially on the same subject

matter for repugnancy to arise and to attract Article 254. If the

subject matters covered by the legislations are different, then

merely because the two legislations refer to some allied or

cognate subjects, they do not cover the same field.

25. A Constitutional Bench judgment of this Court in Indu Bhushan

Bose v. Rama Sundari Debi and Another 8 had inter alia

examined Entry 3 in List I, Entry 18 in List II and Entries 6, 7 and

13 in List III to observe that the general power of legislating in

respect of relationship between landlord and tenant can be traced

either under Entry 18 of List II or Entries 6 and 7 of List III. The

expression ‘land tenures including the relation of landlord and

tenant’ appearing in Entry 18 of List II, it was observed, was used

only with reference to the relationship of landlord and tenant in

respect of vacant lands and does not cover tenancy of buildings or

house accommodation. Nevertheless, the Court did not give a
8 (1969) 2 SCC 289
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SLP (C) No. 26925 of 2011 connected matters Page 21 of 46
finding in definite terms as the relationship of landlord and tenant

in question was in respect of a house accommodation situated in

a cantonment area and therefore was covered by Entry 3 of List I

which vests exclusive power to make laws for the cantonment

areas in the Parliament. Subsequent decision in Jaisingh Jairam

Tyagi and Others v. Mamanchand Ratilal Agarwal and Others 9

and a Constitution Bench judgment in V. Dhanapal Chettiar v.

Yesodai Ammal10 substantially follow Indu Bhushan (supra) to

hold that the subject matter of housing and accommodation falls

within the purview of the Concurrent List.

26. In Accountant and Secretarial Services Pvt. Ltd. and Another

v. Union of India and Others11, this Court had examined the

question of repugnancy and interplay between the Central

enactment, viz. the Public Premises (Eviction of Unauthorised

Occupants) Act, 1971 based on the pattern of the West Bengal

Public Land (Eviction of Unauthorised Occupants) Act, 1962 and

the West Bengal Premises Tenancy Act, 1956 and the question

which of these enactments would prevail. The Court had

interpreted Entries 3, 32, 43 and 44 of List I, Entry 18 of List II and

Entries 5, 6 and 7 of the List III and the corresponding entries in

the Government of India Act, 1935 to hold that all the three

9 (1980) 3 SCC 162
10 (1979) 4 SCC 214
11 (1988) 4 SCC 324
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legislations were passed in exercise of powers conferred with

respect to matters contained in the Concurrent List. In view of the

repugnancy and conflict between the Central enactment on one

hand and the State law on the other, in terms of Article 254, the

Central enactment shall prevail. Further, notwithstanding the

earlier precedents, the Court had examined the question of the

relevant entry applicable to the tenancy legislation and rejected

the contention that Entry 18 of List II should be interpreted as

encompassing within its ambit legislation on the relationship of

landlord and tenant in regard to housing and buildings. Setting out

several reasons it was observed that the power to legislate in

respect of tenanted premises would fall within the ambit and

scope of Entries 6, 7 and 13 of the Concurrent List and would not

be referable to Entry 18 of List II. The expression ‘land’ in Entry 18

of List II should be given as wide a construction as possible, but

has to be read with the relevant entries in other Lists to give

meaning and content to all of them. Inclusion of buildings and

housing in the Concurrent List is appropriate and to place

buildings and housing within the ambit of the expression ‘land’ in

Entry 18 of List II would denude other entries in Lists I and III

concerning transfer of property, devolution and succession of land

and buildings, etc. of their vigour and would render them otiose.

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27. The Amendment Act on its true construction and by reference to

the doctrine of “pith and substance” is relatable to the relationship

of landlord and tenant for housing and accommodation and falls

under the Concurrent List. The dominant intention or “pith and

substance” of the legislation is to regulate the relationship

between Non-Resident Indian landlords and tenants for housing

and accommodation. Merely because the Amendment Act to

achieve its object touches upon the subject matter in respect of

Non-Resident Indian landlords in the Rent Act, does not make the

Amendment or the Rent Act ultra vires the Constitution. The Rent

Act as amended by the Amendment Act and the Central

legislations relating to citizenship, regulation of the right of non-

residents to own and acquire immovable property, cover different

subject matters and serve different objects and there is no

repugnancy between the Rent Act and any Central enactment like

Citizenship Act, Foreign Exchange Regulation Act, etc. We do not

subscribe to the view that the legislative lists under the Seventh

Schedule envisage and mandate separate legislation by the

Central Government for Non-Resident Indian landlords.

28. Keeping in view the aforesaid position, the Amendment Act

enacted by the State legislature was well within its competence.

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We would, however, note that in the context of the Union Territory

of Chandigarh and as the subject matter falls within the

Concurrent List, it will be immaterial to decide on the competence

of the legislating body. The power to make laws in respect of a

Union Territory vests with the Parliament under Article 246(4). In

terms of Section 87 of the Reorganisation Act, the power to extend

laws to the Union Territory of Chandigarh vests with the Central

Government, that is the Parliament or the Central Executive, as

the case may be, and is permissible.

C. Whether Section 13-B of the Rent Act is arbitrary and
unreasonable inasmuch as it does not afford any legal
remedy to the tenants?

29. Before we delve into this question, we would reproduce Section

19(2-B) of the Rent Act which reads as under:

“19. (2-B) The owner, who is a Non-Resident Indian
and who having evicted a tenant from a residential
building or a scheduled building and/or non-residential
building in pursuance of an order made under Section
13-B, does not occupy it for a continuous period of
three months from the date of such eviction, or lets out
the whole or any part of such building from which the
tenant was evicted to any person, other than the tenant
in contravention of the provisions of sub-section (3) of
Section 13-B, shall be punishable with imprisonment
for a term, which may extend to six months or with fine
which may be extended to one thousand rupees or
both.”

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SLP (C) No. 26925 of 2011 connected matters Page 25 of 46
The provision incorporates statutory safeguards to check

and penalise deceitful and two-faced landlords and gives the right

of restitution to the defrauded tenant.

30. Section 18-A of the Rent Act prescribes a summary procedure for

recovery of possession applicable to eviction petitions filed by

Non-Resident Indian landlords under Section 13-B of the Rent Act.

Sub-sections (4), (5), (6) and (8) to Section 18-A of the Rent Act

are reproduced:

“18-A. (4) The tenant on whom the service of summons
has been declared to have been validly made under
sub-section (3), shall have no right to contest the
prayer for eviction from the residential building or
scheduled building and/or non-residential building, as
the case may be, unless he files an affidavit stating the
grounds on which he seeks to contest the application
for eviction and obtains leave from the Controller as
hereinafter provided, and in default of his appearance
in pursuance of the summons or his obtaining such
leave, the statement made by the specified landlord or,
as the case may be, the widow, widower, child,
grandchild or the widowed daughter-in-law of such
specified landlord or the owner, who is a non-resident
Indian in the application for eviction shall be deemed to
be admitted by the tenant and the applicant shall be
entitled to an order for eviction of the tenant.

(5) The Controller may give to the tenant leave to
contest the application if the affidavit filed by the tenant
discloses such facts as would disentitle the specified
landlord or, as the case may be, the widow, widower,
child, grandchild or widowed daughter-in-law of such
specified landlord or the owner, who is a non-resident
Indian, from obtaining an order for the recovery of
possession of the residential building or scheduled

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SLP (C) No. 26925 of 2011 connected matters Page 26 of 46
building and/or non-residential building, as the case
may be, under Section 13-A or Section 13-B.

(6) Where leave is granted to the tenant to contest the
application, the Controller shall commence the hearing
on a date not later than one month from the date on
which leave is granted to the tenant to contest and
shall hear the application from day to day till the
hearing is concluded and application decided.

xx xx xx

(8) No appeal or second appeal shall lie against an
order for the recovery of possession of any residential
building or scheduled building and/or non-residential
building, as the case may be, made by the Controller in
accordance with the procedure specified in this section:

Provided that the High Court may, for the purpose of
satisfying itself that an order made by the Controller
under this section is in accordance with law, call for the
records of the case and pass such order in respect
thereto as it thinks fit.”

31. In Baldev Singh Bajwa v. Monish Saini12, this Court referring to

the provisions of Section 18-A of the Rent Act had observed:

“11. […] These provisions indicate that in order to
obtain leave to contest the application of the landlord,
the tenant has to file an affidavit taking the grounds on
which he wants to contest that application. If the
affidavit filed by the tenant discloses such facts as
would disentitle the NRI landlord from obtaining an
order for the recovery of immediate possession, the
Controller would grant leave to the tenant to contest
the landlord’s application for eviction. Once the leave is
granted, the application is required to be disposed of
as per the procedure applicable to the Court of Small
Causes. The Controller is required to commence the
hearing within one month from the date on which the
leave is granted to the tenant to contest. The
12 (2005) 12 SCC 778
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application shall be heard day to day till hearing is
concluded and application decided. The order to direct
recovery of possession of the suit accommodation
made by the Controller is not subject to appeal or
second appeal. However, the High Court may call for
the record of the case to satisfy itself that the order
passed by the Controller is in accordance with law and
may pass such order as it thinks fit.”

32. In Ravi Dutt Sharma v. Ratan Lal Bhargava13, this Court had

discussed the object of rent control legislation and also insertions

made to provide expeditious, effective and speedy remedy for a

class of landlords who require the premises for bona fide use, to

hold:

“7. […] The dominant object of the amending act [is] to
provide a speedy, expeditious and effective remedy for
a class of landlords contemplated by Sections 14(1)(e)
and 14-A and for avoiding unusual dilatory process
provided otherwise by the Rent Act. It is common
experience that suits for eviction under the Act take a
long time commencing with the Rent Controller and
ending up with the Supreme Court. In many cases
experience has indicated that by the time the eviction
decree became final several years elapsed and either
the landlord died or the necessity which provided the
cause of action disappeared and if there was further
delay in securing eviction and the family of the landlord
had by then expanded, in the absence of
accommodation the members of the family were
virtually thrown on the road. It was this mischief which
the Legislature intended to avoid by incorporating the
new procedure in Chapter III-A. The Legislature in its
wisdom thought that in cases where the landlords
required their own premises for bona fide and personal
necessity they should be treated as a separate class
along with the landlords covered by Section 14-A and
should be allowed to reap the fruits of decrees for
eviction within the quickest possible time. It cannot,
13 (1984) 2 SCC 75
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therefore, be said that the classification of such
landlords would be an unreasonable one because such
a classification has got a clear nexus with the objects
of the amending Act and the purposes which it seeks to
subserve.”

33. Section 18-A of the Rent Act requires the Controller to take up the

matter on a day-to-day basis until the hearing on an application for

leave to defend is concluded. No litigant can possibly object to a

provision stipulating day-to-day hearing which ensures speedy,

expeditious and effective decisions. The observations of this Court

in Ravi Dutt Sharma (supra) are apposite. Section 18-A also

states that the decision of the Controller is final as no appeal or

second appeal lies against the order of eviction except that the

High Court could, to satisfy itself of the correctness of the

decision, examine the matter by calling for the records of the case.

Repelling a similar challenge on the ground that 25-B of the Delhi

Rent Control Act, 1958 does not provide for an appeal or second

appeal against an order of eviction, in Kewal Singh v. Smt.

Lajwanti14 it was observed:

“19. […] An appeal is purely a creature of the statute
and this right has not been given in order to cut out
unnecessary delay. Instead the highest Court of the
State has been given a wide power of revision where
the said Court can examine the case of the tenant and
the landlord and the validity of the order passed by the
Controller. The right of the tenant, therefore, is
sufficiently safeguarded by the proviso to sub-section
(8) of S. 25B of the Act referred to above. In order to
14 (1980) 1 SCC 290
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give relief to the tenant against any apparent error of
law or fact where no revision has been filed in the High
Court the statute confers power of review on the
Controller.”

34. On the requirement of ‘bona fide need’ of Non-Resident Indian

landlords under Section 13-B in Baldev Singh Bajwa (supra), it

was elucidated:

“14. The phrase “bona fide requirement” or “bona fide
need” or “required reasonably in good faith” or
“required”, occurs in almost all Rent Control Acts with
the underlying legislative intent which has been
considered and demonstrated innumerable times by
various High Courts as also by this Court, some of
which we would like to refer to. In Ram Dass v. Ishwar
Chander it is said that the bona fide need should be
genuine and honest, conceived in good faith. It was
also indicated that the landlord’s desire for possession,
however honest it might otherwise be, has inevitably a
subjective element in it, and that desire, to become a
“requirement” in law must have the objective element
of a “need”, which can be decided only by taking all the
relevant circumstances into consideration so that the
protection afforded to a tenant is not rendered illusory
or whittled down.

15. In Bega Begum v. Abdul Ahad Khan it was held by
this Court that the words “reasonable requirement”
undoubtedly postulate that there must be an element of
need as opposed to a mere desire or wish. The
distinction between desire and need should doubtless
be kept in mind but not so as to make even the
genuine need as nothing but a desire.

16. In Surjit Singh Kalra v. Union of India a three-Judge
Bench of this Court has held as under:

“20. The tenant of course is entitled to raise all
relevant contentions as against the claim of the
classified landlords. The fact that there is no
reference to the words bona fide requirement in
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SLP (C) No. 26925 of 2011 connected matters Page 30 of 46
Sections 14-B to 14-D does not absolve the
landlord from proving that his requirement is
bona fide or the tenant from showing that it is not
bona fide. In fact every claim for eviction against
a tenant must be a bona fide one. There is also
enough indication in support of this construction
from the title of Section 25-B which states
‘special procedure for the disposal of
applications for eviction on the ground of bona
fide requirement’.”

17. In Shiv Sarup Gupta v. Dr. Mahesh Chand Gupta
this Court while dealing with the aspect of bona fide
requirement has said that the sense of felt need which
is an outcome of a sincere, honest desire, in
contradistinction with a mere pretence or pretext to
evict a tenant, refers to a state of mind prevailing with
the landlord. The only way of peeping into the mind of
the landlord is an exercise undertaken by the judge of
facts by placing himself in the armchair of the landlord
and then posing a question to himself — whether in the
given facts, substantiated by the landlord, the need to
occupy the premises can be said to be natural, real,
sincere and honest.

18. From the aforesaid decisions the requirement of
the landlord of the suit accommodation is to be
established as a genuine need and not a pretext to get
the accommodation vacated. The provisions of
Sections 18-A(4) and (5) concede to the tenant’s right
to defend the proceedings initiated under Section 13-B
showing that the requirement of the landlord is not
genuine or bona fide. The legislative intent for setting
up of a special procedure for NRI landlords is obvious
from the legislative text which has been deliberately
designed making distinction between the ordinary
landlords and special category of landlords. The
Controller’s power to give leave to contest the
application filed under Section 13-B is restricted by the
condition that the affidavit filed by the tenant discloses
such fact as would disentitle the landlord from
obtaining an order for recovery of possession. It is
needless to say that in the summary proceedings the
tenant’s right to contest the application would be
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SLP (C) No. 26925 of 2011 connected matters Page 31 of 46
restricted to the parameters of Section 13-B of the Act.

He cannot widen the scope of his defence by relying on
any other fact which does not fall within the parameters
of Section 13-B. The tenant’s defence is restricted and
cannot go beyond the scope of the provisions of the
Act applicable to the NRI landlord. Under Section 13-B
the landlord is entitled to eviction if he requires the suit
accommodation for his or her use or the use of the
dependant, who ordinarily lives with him or her. The
requirement would necessarily have to be genuine or
bona fide requirement and it cannot be said that
although the requirement is not genuine or bona fide,
he would be entitled to the ejectment of the tenant nor
can it be said that in no circumstances will the tenant
not be allowed to prove that the requirement of the
landlord is not genuine or bona fide. A tenant’s right to
defend the claim of the landlord under Section 13-B for
ejectment would arise if the tenant could be able to
show that the landlord in the proceedings is not an NRI
landlord; that he is not the owner thereof or that his
ownership is not for the required period of five years
before the institution of proceedings and that the
landlord’s requirement is not bona fide.”

35. In terms of Section 13-B of the Rent Act, the landlord should have

been the owner of the premises for five years before the eviction

petition is filed. Such landlord/owner is permitted to file an eviction

petition only once during the lifetime and in respect of one

building. Sub-section (3) to Section 13-B of the Rent Act imposes

a restriction on sale or lease of the premises for a period of five

years from the date of taking possession from the tenant. On

breach of the conditions/ restrictions mentioned in sub-section (3)

to Section 13-B, the tenant has a right to seek restoration of

possession. Sub-section (2-B) to Section 19 imposes a maximum

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punishment of six months imprisonment or a fine of one thousand

rupees or both in case the landlord does not occupy the premises

for a continuous period of three months after getting an eviction

order or lets out the whole or any part of the premises to a third

person other than the tenant in contravention of the provisions of

sub-section (3) to Section 13-B. The reasoning in Baldev Singh

Bajwa (supra) exposits that these restrictions and conditions are

strong in-built checks to ensure that the need of the landlord

should be genuine and bona fide and the tenant should not be

subjected to frivolous and dubious eviction order by relying on

false assertions.

36. The presumption raised with regard to the genuine need of the

landlord as pleaded in the petition should not be read as an axiom

or self-evident truth, which entitles the landlord and mandates the

Court to pass a decree of eviction. This is clear from subsequent

elucidation by this Court in paragraphs 20 and 21 in Baldev

Singh Bajwa (supra). The true ratio, in our opinion, is reflected in

paragraph 25 which reads as under:

“25. On the interpretation given by us and on a plain
reading of the provisions, once in a lifetime possession
is given to an NRI to get one building vacated in a
summary manner. A non-resident Indian landlord is
required to prove that: (i) he is an NRI; (ii) that he has
returned to India permanently or for a temporary
period; (iii) requirement of the accommodation by him
Civil Appeal arising out of
SLP (C) No. 26925 of 2011 connected matters Page 33 of 46
or his dependant is genuine; and (iv) he is the owner of
the property for the last five years before the institution
of the proceedings for ejectment before the Controller.

The tenant’s affidavit asking for leave to contest the
NRI landlord’s application should confine itself to the
grounds which NRI landlord is required to prove, to get
ejectment under Section 13-B of the Act. The
Controller’s power to give leave to contest the
application filed under Section 13-B is circumscribed to
the grounds and inquiry on the aspects specified in
Section 13-B. The tenant would be entitled for leave to
contest only if he makes a strong case to challenge
those grounds. Inquiry would be confined to Section
13-B and no other aspect shall be considered by the
Controller.”

The requirement of a ‘strong case’ for obtaining leave to

defend means a good case that brings to fore reasonable and

well-grounded basis on which the tenant seeks leave to contest

the eviction proceedings. It does not mean setting up and

establishing at that stage a case beyond any scintilla of doubt and

debate. The grounds and pleas raised should reflect clear and

strong defence and relate to the grounds mentioned in paragraph

25 in Baldev Singh Bajwa (supra). The standard applied is

similar to parameters elucidated in Inderjeet Kaur v. Nirpal

Singh15, in which this Court had held that the leave to defend

should not be granted on mere asking but when the pleas and

contentions raise triable issues and the dispute on facts demands

that the matter be properly adjudicated after ascertaining the truth

of affidavits filed by the witnesses in their cross-examination. Each
15 (2001) 1 SCC 706
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case has to be decided on its merits and not on the basis of any

pre-conceived suppositions and presumptions. By providing for a

simplified procedure of eviction by the Non-Resident Indians,

Section 13-B does not dilute the rights of tenants. It gives a

chance to the tenants on merits to establish their case and when

justified and necessary to take the matter to trial. By no means,

therefore, Section 13-B can be held to be arbitrary and

unreasonable.

37. The expression ‘one building’ appearing in sub-clause (2) to

Section 13-B was examined by a three Judge Bench of this Court

in Swami Nath v. Nirmal Singh16 by referring to the earlier

judgment of this Court in Baldev Singh Bajwa (supra), to

observe:

“13. Reliance was placed on the decision of this Court
in Baldev Singh Bajwa v. Monish Saini where the same
question had come up for consideration and it was
observed that on a plain reading of the provisions of
Section 13-B, it would be obvious that once in a lifetime
possession is given to an NRI to get one building
vacated in a summary manner. It was also submitted
that the ownership of the respondent landlord in
respect of only one building had not been disputed by
the petitioners and the only contention that was raised
on their behalf was that each separate tenancy in a
building would amount to a separate unit and after
exhausting the right of summary possession once, it
was no longer available to the NRI landlord to exercise
such an option for the second time to a particular

16 (2010) 9 SCC 452
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building, which contention had been negated by the
courts below.

14. We have carefully considered the submissions
made on behalf of the respective parties and we are
unable to agree with the submissions made on behalf
of the petitioners. The interpretation sought to be given
to the proviso to Section 13-B(1) of the 1949 Act would
lead to an absurd situation which was not
contemplated by the legislature while introducing the
provisions of Section 13-B by way of amendment in
2001. The very object of the amendment would be
frustrated if the narrow and constricted meaning being
canvassed on behalf of the petitioners is to be
accepted.

15. The provisions of Section 13-B of the 1949 Act
have been correctly interpreted and dealt with in
Baldev Singh Bajwa case and in that view of the
matter, the special leave petitions must fail and are
dismissed. …”

The third contention is accordingly rejected.

D. Whether classifying Non-Resident Indian landlords as a
separate category renders Section 13-B invalid and ultra vires
Article 14 of the Constitution?

38. Legislature’s primary function is to make laws for all or different

groups or classes of persons. The lawmakers as elected

representatives are in a better position than any other body which

is removed from local and other circumstances, to know the

needs, requirements and expectations of citizens. It, therefore,

seems only logical that the legislature possesses the power to

distinguish and classify persons or things subjected to such laws.

Such a classification, however, must pass the muster of Article 14

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which proscribes hostile and invidious discrimination. Recognising

that Article 14 does not entirely prohibit classification by grouping

certain persons with special peculiarities in a special category to

meet certain specific ends, this Court in Ram Krishna Dalmia v.

Justice S.R. Tendolkar17 had postulated two conditions which

must be satisfied for a classification to withstand a challenge

under Article 14, namely: i) the classification should be founded on

intelligible differentia which distinguishes persons or things that

are grouped together from others left out of the group; and (ii) the

differentia must have a rational relation or nexus to the object

sought to be achieved by the statute in question. In State of A.P.

and Others v. Nallamilli Rami Reddi and Others 18, this Court

had further elucidated that a challenge on the ground of denial of

equal treatment will not sustain when the legislature intends to

classify persons under a well-defined class. A classification need

not be scientifically perfect or logically complete and would be

justified unless it is palpably arbitrary. The test to judge the validity

of any classification has to be practical and pragmatic by looking

beyond the classification to the purpose of the law, that is, the

purpose or object of the legislation and the circumstances which

had prevailed when the law was passed and which had

17 1959 SCR 279: AIR 1958 SC 538
18 (2001) 7 SCC 708
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necessitated passing of that law. Not only this, there is a

presumption as to constitutional validity of an enactment

predicated on the belief that the legislature understands and

correctly appreciates the need of its own people and is free to

recognise degrees of harm and may confine its restriction to only

those cases where the need is deemed to be the clearest. The

hardship that may result from the classification cannot be the

basis for determining the validity of any statute. This requires

distinguishing between under-inclusiveness and over-

inclusiveness. The former classification does not confer the same

benefit or place the same burden on others who are similarly

situated whereas over-inclusiveness includes not only those who

are similarly situated with respect to the purpose but others who

are not so situated as well. The latter is frowned upon but the

former may pass the judicial test for the courts do exercise

tolerance to under-inclusiveness unless it is clear that there is no

fair reason for the law which would not require with equal force its

extension to those whom it leaves untouched (See Pioneer

Urban Land Infrastructure Limited and Another v. Union of

India and Others in Writ Petition (Civil) No. 43 of 2019 decided

on 09.08.2019).

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39. The object and reasons for enacting Section 13-B in the Rent Act

vide the Amendment Act were explained in Baldev Singh Bajwa

(supra) in the following words:

“The State Government had been receiving
representations from various NRI individuals and
through their associations highlighting the plight of
Indian residents returning to India after long years
abroad. It was represented that the NRIs having spent
long years of their life abroad did not find conditions
congenial in their own country on their return either to
settle down or to take up any business. On account of
rigid legal provisions of the existing rent laws, the NRIs
were unable to recover possession of their own
residential building from the tenants. The Government
having considered the situation had decided that the
existing rent legislation viz. the East Punjab Urban
Rent Restriction Act, 1949 should be amended to
provide relief to NRIs to enable them to recover
possession of a residential or scheduled building
and/or one non-residential building for their own use.”

The effect of Section 13-B and other provisions of the Rent

Act was explained as:

“10. The amendment introduced in the Act created a
special class of NRI landlords and reposed special
rights in them to recover immediate possession from
the tenants occupying their premises, provided such
premises were required by them. Section 13-B intends
to provide immediate possession of the
accommodation to the NRI landlord which is in
possession of the tenant if the landlord requires the
same for his or her use or for the use of anyone
ordinarily living with him/her and is dependent on him
or her. Sub-section (1) of Section 13-B postulates that
the NRI landlord should be the owner of the building
from which he has asked ejectment of the tenant. He
should require the same for his or her use or for the
use of anyone ordinarily living with him/her and is
dependent on him or her. He should be the owner of
Civil Appeal arising out of
SLP (C) No. 26925 of 2011 connected matters Page 39 of 46
that building for five years before he applied to the
Controller for possession of such building. The right
under Section 13-B of immediate possession could be
availed of only once during the lifetime of such an
owner/NRI landlord. Sub-section (2) of Section 13-B
gives a choice to the NRI landlord to select one among
several other residential buildings or scheduled
buildings and/or non-residential buildings for the
purpose of eviction of the tenant from that premises.
Residential building is defined in Section 2(g) to mean
a building which is not a non-residential building.
Scheduled building is defined in Section 2(h) of the Act
which means a residential building being used by a
person engaged in one or more of the professions,
namely, lawyers, architects, dentists, engineers,
veterinary surgeons, medical practitioners including
practitioners of indigenous systems of medicine and
who occupies the same partly for his business and
partly for his residence. Sub-section (3) of Section 13-B
puts a restriction on the landlord to deal with building of
which he has taken possession by virtue of the order
passed under Section 13-B of the Act of 1949. Under
this section the owner who recovers the possession of
the building by virtue of the order passed under Section
13-B shall neither transfer it either by sale or by any
other mode nor shall he let it out for the period of five
years from the date he took possession of the building.

In case there is a breach on the part of the owner who
took possession of the building, of any of the
conditions, the tenant who had been evicted would be
entitled to apply to the Controller for an order directing
that the tenant be restored back possession of that
building and on such a petition being moved, the
Controller would pass an appropriate order. Apart from
the restriction which is imposed by sub-section (3) of
Section 13-B on the landlord’s right to deal with the
building of which he took possession under the
provisions of Section 13-B, a further restriction has
been imposed on the landlord under Section 19(2-B) of
the Act of 1949. Section 19(2-B) contemplates that
when the order for possession is being passed in
favour of the owner-landlord under Section 13-B, he is
required to occupy the premises continuously for the
period of three months from the date of eviction of the
Civil Appeal arising out of
SLP (C) No. 26925 of 2011 connected matters Page 40 of 46
tenant. He is prohibited from letting out the whole or
any part of that building from which the tenant was
evicted to any other person except the tenant who had
been evicted by virtue of the order passed under
Section 13-B. In contravention of these restrictions, the
landlord is liable for a penal action and can be imposed
punishment of imprisonment for a term which may
extend to six months or with fine which may extend to
Rupees one thousand or with both.”

40. Rent control legislation are quintessentially social legislation that

were enacted in the 1940’s and 1950’s to protect and curb

exploitation of tenants in view of the prevailing socio-economic

conditions due to large scale immigration to towns and cities,

increase in population, lack of housing facilities as landed property

was owned by a few well-off and wealthy persons. The rent control

legislation, therefore, interfered with the general freedom of

contract and right of the landlord to seek eviction under the

Transfer of Property Act. However, all such legislations invariably

also provide for balancing the conflicting rights of the landlords. In

several decisions, this Court has emphasised that there is a need

for balancing the two rival interests as has been observed in

Malpe Vishwanath Acharya and Others v. State of

Maharashtra and Another19, Joginder Pal v. Naval Kishore

Behal20, Satyawati Sharma (Dead) By LRs v. Union of India

19 (1998) 2 SCC 1
20 (2002) 5 SCC 397
Civil Appeal arising out of
SLP (C) No. 26925 of 2011 connected matters Page 41 of 46
and Another21 and in the recent decision in Vinod Kumar v.

Ashok Kumar Gandhi in Civil Appeal No. 3793 of 2016 decided

on 05.08.2019.

41. In Kewal Singh (supra) this Court had rejected the challenge of

discrimination and arbitrariness predicated on Article 14 to the

summary procedure under Section 25-B of the Delhi Rent Control

Act, 1958 applicable in cases of personal necessity of landlords.

The contention that Section 25-B creates a special class of

landlords who are given favourable treatment for speedy eviction

of tenants was rejected as without any substance. The rent control

legislation should be just and fair to the landlords. Accordingly, it

was observed that it is always open to the legislature to check,

regulate and also confer rights upon the landlords to enable them

to seek eviction in certain circumstances. Referring to the ground

of personal necessity, it was observed:

“17. […] Thus, such a landlord becomes a class by
himself. The statute thus puts personal necessity of the
landlord as a special class requiring special treatment
for quick eviction of the tenant and cuts out all delays
and plugs all the loopholes which may cause delay in
getting the relief by the landlord. It is obvious,
therefore, that the classification made by the legislature
is in public interest and is in complete consonance with
the objectives sought to be achieved. The landlords
having personal necessity have been brought together
as a separate class because of their special needs and
such a classification cannot be said to be unreasonable
21 (2008) 5 SCC 287
Civil Appeal arising out of
SLP (C) No. 26925 of 2011 connected matters Page 42 of 46
particularly when the legislature in its wisdom feels that
the landlords should get this relief as quickly as
possible.”

42. The following observations in Ravi Dutt Sharma (supra) relating

to the right given to the landlords for eviction in context of the rent

control legislation are pertinent:

“7. […] Tenants cannot complain of any discrimination
because the Rent Act merely gave certain protection to
them in public interest and if the protection or a part of
it afforded by the Rent Act was withdrawn and the
common law right of the tenant under the Transfer of
Property Act was still preserved, no genuine grievance
could be made.”

Similar views were also expressed in Kewal Singh (supra)

in the following words:

“22. Thus, we do not see how can the tenant challenge
the validity of such a provision enacted by the
legislature from which the tenant itself derived such
rights.

23. In the instant case, the legislature has not taken
away the right of the tenant at all but has merely
simplified the procedure for eviction of the tenant in
cases falling within the ambit of Sections 14-A and
14(1)(e) of the Act as discussed in the judgment. In
these circumstances, therefore, any challenge by the
tenant to the constitutionality of the Act must
necessarily fail and hence Section 25-B is
constitutionally valid.”

43. Section 13-B of the Rent Act cannot be held to be unconstitutional

because it grants a right to claim eviction for bona fide need by

summary procedure to a certain group of landlords, that is, Non-

Resident Indians subject to and on the satisfaction of statutory
Civil Appeal arising out of
SLP (C) No. 26925 of 2011 connected matters Page 43 of 46
conditions which incorporate a check on frivolous evictions. The

plea that Section 13-B ought to be struck down on the ground that

similar rights can be extended to other landlords is without

substance and should be rejected. It rests with the legislature to

make laws and extend it to other similarly situated persons. The

rent act(s) invariably give similar rights by a controlled mechanism

and alluded riders to various other classes/groups of landlords,

namely, government servants, members of armed forces, the

retired or soon to retire employees of the Central and the State

Governments, widows, etc.

44. The right of Non-Resident Indians to initiate eviction under the

summary procedure provided in Section 18-A of the Rent Act is

not an unfettered and absolute right. It is subject to satisfaction of

various pre-requisites and imperatives that ensure and check

potential abuse by resorting to a short-circuit procedure. The

requirement should arise from a genuine need of the Non-

Resident Indian landlord or his dependent. Such landlord should

be an owner for five years preceding the date of filing of the

eviction petition. There is a cap on permitting the use of the

provision which is available only once in a lifetime and only in

respect of one building. There are restrictions and constraints on

the re-sale and re-letting and a further requirement to possess the
Civil Appeal arising out of
SLP (C) No. 26925 of 2011 connected matters Page 44 of 46
property for a continuous period of three months after the

possession is taken. These pre-conditions and post possession

restrictions suggest that Section 13-B serves a specific policy

objective to ensure the right of Non-Resident Indians to occupy

their property in the Union Territory of Chandigarh and the State of

Punjab as the case may be, after “returning” to their country. This

right has to be balanced with the right of the tenants to establish

their case on merits by disproving the genuine requirement of the

Non-Resident Indians.

45. Section 13-B cannot, therefore, be treated as an arbitrary

classification that infringes and violates Article 14 of the

Constitution. The challenge predicated on the basis of

unconstitutionality of the classification is rejected.

46. Before reserving the judgment, we had heard counsel for the

appellants on merits and had expressed that we were not inclined

to interfere with the factual findings. Accordingly, we have not

dealt with the factual matrix in each case and have examined and

answered the legal issues raised. In view of the findings

upholding the constitutional validity of Section 13-B of the Rent Act

and its extension and applicability to the Union Territory of

Civil Appeal arising out of
SLP (C) No. 26925 of 2011 connected matters Page 45 of 46
Chandigarh, we would dismiss the afore-captioned appeals by the

tenants. There would be no order as to costs.

………………………………..CJI
(RANJAN GOGOI)

………………………………….J.
(L. NAGESWARA RAO)

………………………………..J.

(SANJIV KHANNA)

NEW DELHI;

NOVEMBER 14, 2019.

Civil Appeal arising out of
SLP (C) No. 26925 of 2011 connected matters Page 46 of 46

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