Holding

The Maharashtra Rent Control Act, 1999’s provisions for fixing standard rent and obligating the landlord to maintain essential services apply to public premises and are not repugnant to the Public Premises (Eviction of Unauthorised Occupants) Act, 1971, making the standard rent application maintainable.

Summary

The appellant, Banatwala & Co., a tenant of premises owned by Life Insurance Corporation of India (LIC), sought fixation of standard rent and restoration of essential services under the Maharashtra Rent Control Act, 1999 after the landlord raised rent and failed to repair a lift. The respondents argued that the premises were public premises covered by the Public Premises (Eviction of Unauthorised Occupants) Act, 1971, rendering the MRC Act inapplicable and ousting civil court jurisdiction. The Supreme Court examined whether the two statutes conflicted, whether there was repugnancy under Article 254, and whether the civil courts' jurisdiction was barred. It held that the MRC Act governs rent fixation and essential services, while the Public Premises Act governs eviction and recovery of arrears, and that there is no repugnancy or ouster of jurisdiction. Consequently, the standard rent application is maintainable, the High Court order setting it aside is set aside, and the Small Causes Court order is upheld.

Issues considered

The applicability of the Maharashtra Rent Control Act, 1999 to public premises owned by a statutory corporation covered by the Public Premises Act for fixation of standard rent.
Whether the provisions of the MRC Act are repugnant to or overridden by the Public Premises (Eviction of Unauthorised Occupants) Act, 1971 under Article 254 of the Constitution.
Whether Section 15 of the Public Premises Act ousts the civil court's jurisdiction to entertain applications for standard rent fixation and essential services.
Whether the Central Government guidelines dated 30 May 2002 are binding directions under the Life Insurance Corporation Act, 1956.
The maintainability of a standard rent application before the Court of Small Causes.

Legislation cited

Constitution of Indias. Article 254(1), s. Article 254(2)
Life Insurance Corporation Act, 1956s. 21
Maharashtra Rent Control Act, 1999s. 10, s. 11, s. 12, s. 14, s. 15, s. 2(14), s. 29, s. 3, s. 33, s. 4, s. 6, s. 7, s. 8
Public Premises (Eviction of Unauthorised Occupants) Act, 1971s. 15, s. 2(e), s. 5, s. 7
Transfer of Property Act, 1882s. 105, s. 108

Subjects

rent controlstandard rentpublic premisesevictionrepugnancyArticle 254landlord-tenantessential servicesjurisdictionMaharashtra Rent Control ActPublic Premises Act

Judgment

[2011] 14 (ADDL.) S.C.R. 533

BANATWALA & COMPANY A
V.
L.l.C. OF INDIA & ANR.
(Civil Appeal No. 7171 of 2010)

SEPTEMBER 19, 2011
B
[R.V. RAVEENDRAN AND H.L. GOKHALE, JJ.]

Rent Control and eviction:

Maharashtra Rent Control Act, 1999 - s. 2(14), 8 and 29 C
- Provisions for fixation of standard rent and maintenance of
essential services under the Maharashtra Rent Control Act -
Applicability of, to public premises owned by public
corporations/undertakings - Held: The subjects of fixation of
Standard Rent and restoration of essential services by the o
lan(Jlord are covered under the Maharashtra Rent Control Act
and not under the Public Premises Act - Application of the
tenants for the said matters when necessary, are maintainable
under the Maharashtra Rent Control Act - Eviction and
recovery of arrears of rent are alone covered under the Public E
Premises Act - Thus, the provisions of the Maharastra Rent
Control Act with respect to fixation of Standard Rent for
premises, and requiring the landlord not to cut off or withhold
essential supply or service, and to restore the same when
necessary, are not in conflict with or repugnant to any of the
F
provisions of the Public Premises Act - Provisions of the
Public Premises Act govern the relationship between the
public undertakings covered under the Act and their
occupants to the extent they provide for eviction of
unauthorised occupants from public premises, recovery of
arrears of rent or damages for such unauthorised occupation, G
and other incidental matters specified under the Act -
Provisions of the Maharashtra Rent Control Act govern the
relationship between the public undertakings and their
occupants to the extent it covers the other aspects of the
533 H
534 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A relationship between the landlord and tenants, not covered
under the Public Premises Act - Public Premises (Eviction
of Unauthorised Occupants) Act, 1971 - ss. 2(e), 5, 7 and 15.

Public Premises (Eviction of Unauthorised Occupants)
B Act, 1971:

ss. 2(e), 5, 7, 15 - Eviction of unauthorised occupants
from Public Premises and recovery of arrears of rent from
them - Initiation of proceedings under the Public Premises
Act - Held: Proceedings initiated by the landlord would be fully
C competent under the Public Premises Act - Occupants would
not be entitled to seek any remedy under the Bombay Rent
Act or the subsequent Maharashtra Rent Control Act since
the jurisdiction of the civil court has been ousted uls. 15 -
Bombay Rents, Hotel and Lodging House Rates (Control) Act,
D 1947 - Maharashtra Rent Control Act, 1999.

ss. 10 and 15 - Jurisdiction of civil courts for the remedies
of fixation of rent or maintenance of essential services, if
ousted - Held: Jurisdiction of the civil court for these remedies
E is not ousted - Actions covered under the Public Premises
Act are concerning eviction of unauthorised occupants and
recovery of arrears of rent - Act does not speak anything
about the fixation of Standard Rent or maintenance of
essential services and no remedy is provided thereunder -
F The fact that proceeding for one purpose is provided under
one statute cannot lead to an automatic conclusion that the
remedy for a different purpose provided under another
competent statute becomes unavailable.

Constitution of India, 1950:
G
Article 254(2) - Repugnancy between the law made by
the Parliament and the law made by the State Legislature -
When arises - Held: When both the legislation occupy the
same field with respect to one of the matters enumerated in
H List Ill and where a direct conflict is seen between the two - It
! -
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 535

·is. to be examined as to whether the two legislations occupy A
the same field - There is no repugnancy when legislations
do not occupy the same field - Provisions of Maharashtra
Rent Control Act with respect to fixation of Standard Rent and
requiring the landlord to maintain the essential services and
supplies not in conflict or repugnant to any of the provisions B
under the Public Premises Act - Public Premises (Eviction
of Unauthorised Occupants) Act, 1971 - Maharashtra Rent
Control Act, 1999 - ss. 2(14), 8 and 29.

Two Acts when governing the common field, whether both C
can apply for different purpose - Held: There could be
provisions for certain purposes in one statute and for another
purpose in another statute though both govern the common
field.

Life Insurance Corporation Act, 1956 - s. 21 - D
Corporation to be guided by directions of Central Government
- Guidelines dated 30.5.2002 laid down by the Central
Government that the provisions of the Public Premises Act,
1971 should be used primarily to evict totally unauthorised
occupants and to secure periodic revision of rent in terms of E
the provisions of the Rent Control Act in each State, or to
move under genuine grounds under the Rent Control Act for
resuming possession, whether directions uls. 21 - Held:
Guidelines dated 30.5.2002 are not directions u/s. 21 -
Purpose of these guidelines is to prevent arbitrary use of F
powers under the Public Premises Act - Relevance of the
guidelines would depend upon the nature of guidelines and
the source of power to issue such guidelines - Source of the
right to apply for determination of standard rent is the Rent
Control Act, and not the guidelines - Also, by subsequent G
clarificatory order, the Central Government made it clear that
the guidelines dated 30. 5. 2002 would not apply to affluent
tenants - Public Premises (Eviction of Unauthorised
Occupants) Act, 1971.

Rent Control and eviction: H
536 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A Exemption from operation of Rent Act - Legislative ·
expectations from public bodies as landlords - Held:
Exercise of discretion of public authorities must be tested on
the assumption that they would act for public benefit and would
not act as private landlords - However, these principles not
B relevant while considering a dispute between a statutory body
as landlord and an affluent tenant in regard to a commercial
or non-residential premises.

Relationship between landlord and tenant in general -
Changes brought about by the Rent Control Acts - Explained
C and di'scussed.
First respondent-Life Insurance Corporation of India
(L.1.C.) a statutory corporation leased out a floor of a
building to appellant firm in the year 1988 under an
D agreement of lease. At tha't time, the Public Premises
(Eviction of Unauthorised Occupants) Act, 1971 as well
as the Bombay Rents, Hotel and Lodging House Rates
(Control) Act, 1947 were in force. The Bombay Rent Act
was replaced by the Maharashtra Rent Control Act, 1999
E with effect from 31.03.2000. The said lease agreement was
extended from time to time. In the year 2004, the monthly
rent of the premises was revised and the same was
challenged in a writ petition which was subsequently
withdrawn and the rent was reduced. Thereafter, the lift
F of the said building was not working properly and an
application was filed in the Small Causes Court, for
restoration of the lift services under Section 29 of the
Maharashtra Rent Control Act, 1999. The court directed
the respondents to repair the lift. Aggrieved, the
G respondents filed a revision petition on the ground that
the Maharashtra Rent Act was not applicable and the
same was dismissed. Subsequently, the rent was
increased and also demand was raised for arrears of rent.
Aggrieved, the appellant asked for the break up of rent
but they did not receive any reply. The appellant filed an
H application under Section 8(3) of the MRC Act in the Court
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 537

of Small Causes for fixation of standard rent, and cilso A
filed an application for. fixing interim rent. The
respondents contended that the suit premises were
public premises covered under the Public Premises Act
and the MR~ Act was not applicable to them. The
responden"ts also filed an interim application. The Small B
Causes Court rejected the said application holding that
the Standard Rent Application was maintainable under
the provisions of the MRC Act. The respondents then
filed a writ petition. The High Court set aside the order
passed by the Small Causes Court and dismissed the c
Standard Rent Application. Therefore, the appellants filed
the instant appeals.

The question which arose for consideration in the
instant appeal was whether the provisions for fixation of
standard rent, and provisions prescribing other D
obligations for the landlord such as maintenance of
essential services under the Maharashtra Rent Control
Act, 1999 are applicable in respect of public premises
owned by a Corporation such as the first respondent-Life
Insurance Corporation of India which is otherwise E
covered by the provisions of the Public Premises
(Evict~n of Unauthorized Occupants) Act, 1971.

Allowing the appeal, the Court
F
HELD: 1. {a) The provisions of the Maharastra Rent
· Control Act, 1999 with respect to fixation of Standard
Rent for premises, and requiring the landlord not to
cut off or withhold essential supply or service, and
to restore the same when necessary, are not in
conflict with or repugnant to any of the provisions of G
the Public Premises (Eviction of Unauthorised
Occupants) Act, 1971.
(b) The provisions of the Public Premises Act, 1971.
H
538 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A shall govern the relationship between the public
undertakings covered under the Act and their
occupants to the extent they provide for eviction of
unauthorised occupants from public premises,
recovery of arrears of rent or damages for such
8 unauthorised occupation, and other incidental
matters specified under the Act.

{c) The provisions of the Maharashtra Rent Control
Act, 1999 shall govern the relationship between the
public undertakings and their occupants to the
c extent this Act covers the other aspects of the
relationship between the landlord and tenants, not
covered under the Public Premises Act, 1971.

{d) The application of appellant and similar
D applications of the tenants for fixation of Standard
Rent or for restoration of essential supplies and
services when necessary, shall be maintainable
under the Maharashtra Rent Control Act, 1999. [Para
72] [615-F-H; 616-A-C]
E
Relationship of landlord and tenant in general:

2.1. A tenancy is created as a result of an agreement
between the landlord and a tenant. Since the premises
owned by the landlord are leased out to the tenant by
F virtue of the agreement between the parties, the
agreement is normally called a 'lease deed'. Although, the
lease deed is also a contract between the parties, the
provisions of T.P. Act relating_ to contracts, shall be taken
as part of the Indian Contract Act, 1872 {Section 4 of T.P.
G Act). As a 'lease deed' is a contract relating to 'leases'
governed by T.P. Act, the relationship between the
landlord and the tenant would be governed by the terms
of the lease deed and subject to its terms, by Section 108
relating to the rights and liabilities of leasor and leasee,
H
BANATWALA & COMPANY v.· L.1.C. OF INDIA & ANR. 539

and other statutory provisions controlling leases under A
the T.P. Act. [Para 10] [557-F-H; 558-A-B]

The Law of Landlord and Tenant by Prof. P.F. Smith
Fourth Edn, p 9 - referred to.

2.2. Generally, the terms of the agreement between 8
the landlord and the tenant would require the landlord to
maintain the premises in tenantable condition, and he will
get the premises repaired when necessary. The tenant
will be required to vacate the premises at the end of the
· period of lease. During the lease period, it will be the C
· responsibility of the tenant to pay the rent regularly and
'keep the premises in good condition subject only to
changes caused by reasonable wear and tear or
irresistible force' and 'when such defect has been caused
by any act or default on the part of the lessee, his servants D
or agents, he is bound to make it good within three
months after such notice has been given or left'. If the
tenant commits breach of the lease agreement by not
paying the rent regularly or remaining in arrears thereof,
or causing damage to the premises, the landlord may E
terminate the lease earlier, even before the expiry of the
agreed term as per the provisions concerning .the
termination provided in the agreement and the Transfer
of Property Act. If the tenant does not vacate the premises
after the termination of lease, the landlord will have to file F
a suit for evicting him in the Civil Court: On the other hand
'if the lessor neglects to make, within a reasonable time
after notice, any repairs which he is bound to make to the
property, the lessee may make the same himself, and
deduct the expense of such repairs with interest from the G
rent, or otherwise recover It from the lessor'. Section 108
(I) of the T.P. Act lays down that 'the lessee is bound to
pay or tender, at the proper time and place, the premium
or rent to the lessor or his agent in this behalf'. This
implies that the amount of rent that the landlord will H
540 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

- A require shall be a certain definite amount. [Paras 11 and
12] [558-C-H; 559-A]

The changes brought about by the Rent Control Acts -

3.1. Due to the problems of the scarcity of
B accommodation following the Second World War, special
protection was made available to the tenants against
unjustified increases in rent and ejectment from the
tenancies. This protection was reflected in the provisions
of various Rent Control Acts such as the Bombay Rents,
C Hotel and Lodging House Rates (Control) Act, 1947
which governed the premises of the appellant for all
purposes prior to the coming into force of the Public
Premises Act, 1971. The Bombay Rents, Hotel and
Lodging House Rates (Control) Act, 1947, is one such
D legislation which is an advancement over the Transfer of
Property Act. This Act laid down that a tenant will not be
evicted unless the landlord establishes that the tenant
has committed breaches as laid down under that Act, and
the burden will be on the landlord to establish that the
E tenant has committed the particular breach, such as
being in arrears of standard rent over a specified period,
erecting permanent structures on the premises without
landlord's permission, sub-letting the premises and
causing nuisance to the neighbours etc. />. reasonable
F and bonafide requirement of the landlord was also
provided as a ground for eviction. If the landlord was
charging rent excessively, a right was given to the tenant
to have the standard rent fixed under Section 11 of that
Act. A further right was given to the tenant to approach
the Court under Section 24 of that Act for maintenance
G
and restoration of essential services in case the landlord
neglected. the same. [Para 13] [559-A-H; 560-A]

The Law of Rent Control by R.B. Andhyarujina, Second
Edn p 12 - referred to.
H
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 541

3.2. Earlier, the relationship between L.l.C as the A
landlord and its tenants was governed under the Bombay
Rent Act 1947. The Public Premises (Eviction of
Unauthorised Occupants) Act, 1971, provides only for
eviction of unauthorized occupants, and recovery of
arrears of rent from the tenant and those subjects no B
longer remained covered under the Bombay Rent Act.
The Bombay Rent Act came to be replaced by the
Maharashtra Rent Control Act, 1999. The MRC Act is
subsequent to the Public Premises Act, 1971, and has
come into force with effect from 31.3.2000 after receiving c
the assent of the President of India. Therefore, the
subjects which were covered under the Bombay Rent Act
came to be covered under the MRC Act as appropriately
modified including the concept of standard rent. [Paras
14, .15 and 16] [560-C, G-H] D
The impugned judgment of the High Court and its reliance
on the Constitution Bench judgment in Ashoka
Marketing Ltd.:

4. The impugned judgment in the instant case relied E
upon the observations in Ashoka Marketing's case-"the
provisions of the Public Premises Act, to the extent they
cover premises falling within the ambit of the Rent
Control Act, override the provisions of the Rent Control
Act and a person in unauthorized occupation of public F
premises under Section 2(e) of the Act cannot invoke the
protection of the Rent Control Act", to hold that once the
premises were covered under the Public Premises Act,
that Act will override the Rent Control Act and therefore,
in the instant case, standard rent application was not G
maintainable. On the other hand, it was submitted on
behalf of the appellant that the statement in Ashoka
Marketing judgment, when it speaks of 'provisions to the
extent they cover', it means the 'subject matter' covered
by the provisions under the two acts. It must be noted
that the controversy in the case of Ashoka Marketing was H
542 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A with respect to the subject of eviction of the
unauthorized occupants from the public premises.
Eviction of tenants in general was a subject covered by
both the statutes under considerations before the Court.
However, the Public Premises Act contains the special
B provisions for the eviction of unauthorized occupants
from the public premises, but for which they would fall
within the ambit of the Rent Control Act. Consequently,
in view of the dicta, the proceedings under the Public
Premises Act were held to be valid and legal, and not
c those under the Delhi Rent Control Act. The subject
matter of controversy in the instant case is with respect
to the fixation of standard rent, which is not covered
under the provision in the Public Premises Act. On the
other hand the same is very much covered under the
Maharastra Rent Control Act, 1999. The overriding effect
0
given to Public Premises Act cannot mean overriding with
reference to a matter which was not dealt with by that Act,
since the Public Premises Act did not claim to cover the
subject other than eviction of unauthorized occupants
E from public premises and recovery of arrears of rent.
[Para 31] [583-H; 584-A-F]

Ashoka Marketing Ltd. and Anr. Vs. Punjab National
Bank and Others 1990 (4) SCC 406: 1990 (3) SCR 649; New
Delhi Municipal Committee Vs. Kalu Ram & Anr. AIR 1976
F SC 1637 : 1976 Suppl. SCR 87; Shri Sarwan Singh and
another Vs. Shri Kasturi Lal 1977 (1) SCC 750: 1977 (2) SCR
421 - referred to.

Public Premises Act vis-a-vis the Bombay Rent Act and
G the MRC Act on the issue of eviction of unauthorised
occupants from Public Premises:

5. For the purposes of eviction of unauthorised
occupants, and for the recovery arrears of rent from
them, the proceedings to be initiated by the respondents
H would be fully competent under the Public Premises Act,
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 543

and that in such an eventuality the occupants would not A
-c be entitled to seek any remedy under the Bombay Rent

Act or the subsequent MRC Act, since the jurisdiction of
the Civil Court has been ousted under Section 15 -of the
Public Premises Act in this behalf. [Paras 32, 58] [584-G-
H; 585-A; 606-D] B

Kaiser-I-Hind Pvt. Ltd. & Anr. vs. National Textile Corpn.
(Maharashtra North) Ltd. & Ors. 2002 (8) SCC 182: 2002 (2)
Suppl. SCR 555; Crawford Bayley & Co. & Ors. v. Union of
India & Ors. 2006 (6) SCC 25: 2006 (3) Suppl. SCR 240 - C
relied on .

. The question of Repugnancy:

6.1. The distribution of legislative powers between the
Union of India and the States has been provided in the o
Seventh Schedule of the Constitution. It consists of List
I which is the Union List, List II which is the State List and
List Ill which is the Concurrent List: The question of
repugnancy can arise only in connection with the
subjects which are enumerated in the Concurrent List E
with respect to which both the Union and the State
Legislatures have the concurrent power to legislate, and
when the State Legislature makes a law on a subject on
which the Parliament has already made a law. It is to deal
which such a conflict that Article 254 has been enacted.
F
Article 254 of the Constitution deals with the question of
inconsistency between the laws made by the Parliament
and laws made by the Legislatures of States. [Para 34]
[589-A-C]

6.2. The question of repugnancy between the law G
made by the Parliament and the law made by the State
Legislature may arise in cases when both the legislation
occupy the same field with respect to one of the matters
enumerated in List Ill and where a direct conflict is seen
between the two. The question therefore to be examined H
544 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A is as to whether the two legislations occupy the same
field. If they do not, then there is no repugnancy. Unless
the provisions are irreconcilable, there will be a
presumption in favour of the constitutionality. [Paras 35
and 36] [590-B; 591-B]
B
6.3. The MRC Act which is a State Act, is an Act
subsequent to the Public Premises Act, and has been
assented by the President, notwithstanding the existence
of the Public Premises Act, the situation, therefore, would
C be governed by Sub-article (2) of Article 254 of the
Constitution. [Paras 60, 61]

Hoechst Pharmaceuticals Ltd. Vs. State of Bihar 1983 (4)
SCC 45: 1983 (3) SCR 130; State of West Bengal Vs.
Kesoram Industries Ltd. And Ors. 2004 (10) SCC 201: 2004
D (1) SCR 564; Ch. Tika Ramji and Ors. etc. v. The State of
Uttar Pradesh and Ors. AIR 1956 SC 676: 1956 SCR 393;
M. Karunanidhi vs. Union of India and Anr. 1979 (3) SCC
431: 1979 (3) SCR 254; Deep Chand vs .. State of UP. AIR
1959 SC 648: 1959 (2) Suppl. SCR 8; Vijay Kumar Sharma
E and Ors. vs. State of Kamataka and Ors. 1990 (2) SCC 562:
1990 (1) SCR 614 - referred to.
In the event of two Acts governing a common field,
whether both can apply for different purposes:

F 7. There could be provisions for certain purposes in
one statute, and for another purpose in another statute,
though both govern the common field. [Para 39] [593-D]

Krishna Distt. Coop. Mktg. Society Ltd. Vij"ayawada vs.
G N. V. Pumachandra Rao & Ors. 1987 (4) SCC 99: 1987 (3)
SCR 728; National Engineering ·Industries Ltd. v.s. Shri Kishan.
Bhageria & Ors. 1988 Supp. SCC 82; Bhart.~ Hydro Power
Corpn. Ltd. & Ors. y. State of Assam & Anr. 2004 (2) SCC.
553: 2004 (1) SCR 284; State of Maharashtra v. Bharat
H Shanti Lal Shah and Ors. 2008 (13) SCC 5: 2008 (12) SCR
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 545

1083; Zameer Ahmed Latifur Rehman Sheikh vs. State of A
- Maharashtra & Ors. 2010 (5) SCC 246: 2010 (4) SCR 1042
- referred to.

Fixation of Standard Rent in the context of exemptions
from the Rent Control Laws - The question of remedy: B
8. Whatever be the object of granting exemption,
where the object is to see that the properties of the State
or semi-state bodies should not suffer by the rigours of
the Rent Control Laws or the possession of the public
premises. be recovered expeditiously, "the Courts have C
expressed their views that these authorities being public
bodies should so behave as not to act contrary to the
policies laid down in the Rent Control Laws namely not
to increase the rent unreasonably or excessively, nor to
evict their tenant unreasonably or arbitrarily, save and D
except in public interest." [Para 42] [595-G-H; 596-A-B]

Rampratap Jaidayal Vs. Dominion of India AIR 1953
Born 170; State of Bombay Vs. F.N. Balsara 19~1 SCR 682:
53 Born. LR 982 (SC); Chiranjitlal v. Union of India' AIR 1951 E
SC 41: 1950 SCR; Baburao Shanta ram More Vs. The
Bombay Housing Board AIR 1954 SC 153: 1954 SCR 572;
Mis Dwarkadas Marfatia V. Bombay Porl Trust 1989 (3) SCC
293 - referred to.

J.H. Dalal in his Commentary on the Bombay Rent Act F
Fifth Edn, p 65 - referred to.

The issue with respect to maintainability of the Standard
Rent application and the question of conflict with the
provisions of the Public Premises Act: G

9. In the instant case, the subjects of fixation of
Standard Rent and restoration of essential services by
· the landlord are covered under the MRC Act, but in no
way under the Public Premises Act. The Public Premises
H
546 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A Act, in fact does not claim to cover these subjects. The
Court has to look at the substance of the matter. Regard
must be had to the enactment as a whole, to its main
objects and scope of its provisions. Incidental and
superficial encroachments are to be disregarded.
B Eviction and recovery of arrears of rent are alone covered
under the Public Premises Act. The subject of fixation of
rent is different and independent from eviction. That being
the position, there is no conflict between the MRC Act and
the Public Premises Act when it comes to the provisions
C in the MRC Act with respect to fixation of Standard Rent
and requiring the landlord to maintain the essential
services and supplies. Therefore, the provisions of MRC
Act in that behalf cannot in any way be said to be
repugnant to those under the Public Premises Act. The
presumption is in favour of constitutionality, and the
0
Court is not expected to strike down a· provision unless
the conflict is a real one. In the instant matter there is no
such real conflict. [Para 62] [608-C-H]

Bharath Gold MinGs Ltd. vs. Kannappa ILR 1988 KAR
E 3092 - approved.

Jain Ink Mfg. Co. vs. UC Prithipal Singh v. Satpal Singh
(Dead) thr. its Lrs. 2010 (2) SCC 15: 2009 (16) SCR 736;
State of West Bengal vs. Kesoram Industries Ltd. And Ors.
F 2004 (10) sec 201: 2004 (1) SCR 564 - relied on.

On ouster of the jurisdiction of the civil courts:

10.1. Section 10 of the Public Premises Act does give
a finality to the orders passed by the Estate Officers or
G the Appellate Officers, and states that 'the same shall not
be called in question in any original suit, application or
execution proceeding, and no injunction shall be granted
by any court or other authority in respect of any action
taken or to be taken in pursuance of any power conferred
H
BANATWALA & _COMPANY v. L.l.C. OF INDIA & ANR. 547

by or under: this Act'. Section 15 of the Act specifically A .
- states that no court shall have jurisdiction to entertain
any suit or proceeding in respect of the subjects,
amongst others concerning, '(a) the eviction of any
person who is in unauthorised occupation of any public
premises, and (d) the arrears of rent payable under sub- B
section (1) of Section 7 or damages payable under sub-
section (2), or interest payable under sub-section· (2A), of
that section'. Therefore, to that extent the jurisdiction of ·
the Civil Court is ousted. The actions which are covered
under the Public Premises Act are concerning eviction of c
unauthorised occupants and recovery of arrears of rent.
The Act however, does not claim to speak anything about
the fixation of Standard Rent or maintenance of essential
services. For these purposes no remedy is provided
under the Public Premises Act. Therefore, the jurisdiction 0
of the Civil Court for these remedies cannot be held to
be ousted. [Para 63] [609-G-H; A-C]

Church of North India vs. Lavajibhai Ratanjibhai 2005
(10) SCC 760; Dhulabhai Vs. State of MP. AIR 1969 SC 78:
1968 SCR 662 - referred to. E

10.2. It was submitted that if the submission of the
appellant is accepted it would mean permitting
proceedings before the Court of Estate Officer for
recovery of arrears of rent, and before the Rent Controller F
for fixation of standard rent, and the same is not desirable.
This by itself can be no reason to hold the Standard Rent
Application to be not maintainable before the Court of
Small Causes. [Para 64] [610-E]

Church of North India vs. Lavajibhai Ratanjibhai 2005 G
(10) SCC 760; National Engineering Industries Ltd. vs. Shri
Kishan Bhageria & Ors. 1988 Supp. SCC 82 - refe_rred to.

10.3. The MRC Act being a welfare statute like the
labour laws is enacted a~er considering the requirements H
548 SUPREME COURT REPORTS (2011] 14 (ADDL.) S.C.R.

A of the tenants, and contains the provisions f~r fixation of
standard rent and for restoring essential services and
supplies when necessary. The public premises are not
specifically exempted from the applicability of the MRC
Act. That being so, there is no reason to hold that these
s remedies would not be available to the tenants of the
public premises, though for the purposes of eviction of
unauthorised occupants and recovery of arrears of rent,
the proceedings would lie only under the Public Premises
Act. The proceedings for the recovery of arrears of rent
c are at the instance of landlord, whereas those for fixation
of standard rent are at the instance of the tenant. Both
these proceedings are quite different in their prayers and
scope of consideration. The fact that the proceeding for
one purpose is provided under one statute cannot lead
to an automatic conclusion that the remedy for a different
0
purpose provided under another competent statute
becomes unavailable. [Para 65] [611-E-H; 612-A]

Expectations from Public Bodies:

E 11. The exercise of discretion of public authorities
must be tested on the assumption that they would act for
public benefit and would not act as private landlords and
they must be judged by that standard. However, these
principles would have no relevance while considering a
F dispute between a statutory body as landlord and an
affluent tenant in regard to a commercial or non-
residential premises. [Para 66] [612-H; 613-A]

Rampratap Jaidayal Vs. Dominion of India AIR 1953
Born 170; Baburao Shantaram More Vs. The Bombay
G Housing Board AIR 1954 SC 153:1954 SCR 572; Mis
Dwarkadas Marfatia V. Bombay Port Trust 1989 (3) SCC
293 - relied on.

On the relevance of Guidelines:
H
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 549

12.1. In the instal)t case, the activities of the A
respondent/L.l.C are controlled by the UC Act. Section 21
of the LIC Act lays down tha~ the Corpor<1tion shall be
guided by- the directio·ns is.su.ed by .the Central
Government. The guidelines. dated 30.5.2002 laid down
by the· Central Government are not direcUons under B
Section 21 of the .LIC Act.. Guideline no .. 2 (I) states that
the provisions of the Public Premises Act, 1971 should
be- used primarily· to evict totally unauthorised
occupants. Guideline No.· 2 (iii) specifically states that it
will be open to the public_ authority to secure periodic c
revision of rent in terms of the provisions of the Rent
Control Act in each State,-,or to move under genuine
grounds under the Rent. Control Act' for resuming
possession. Thus, the~e guidelines specifically
recognize _the relevance of certain provisions of Rent
0
Control Acts-for their application to the properties
covered under'the Public Premises Act. It is stated' in the
guidelines that the public authoriti_es would have rigtits
similar to private landlords under the Rent Control Acts
in dealing with genuine legal tenants. It follows that the E
public authorities would have the obligations of the
private landlord~ also. The purpose of these guidelines
is to prevent arbitrary use of powers under the Public
Premises Act. The relevance of the guidelines would
depend upon the nature of guidelines and the source of
power to issue such guidelines. The source of the right F
to apply for determination of standard rent is the Rent
Control Act, and not the guidelines. By subsequent
clarificatory order, the Central Government has made it
clear that the guidelines dated 30,5.2002 would not apply
to affluent tenants. [Paras 67, 68 and 69] [613-B-E; 613- G
F-H; 614"A~C]

12.2. The respondents submitted that if the appellant
or the tenants are aggrieved by the fixation of the rent,
their remedy is to invoke the writ jurisdiction of the High H
550 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A Court. The respondents ignored that the writ jurisdiction
is a discretionary jurisdiction. Besides, normally oral
evidence is not recorded w.hile exercising the writ
jurisdiction. Although part of the ev.idence to be examined
in the process of rent fixation would be documentary,
B such as the provisions of the contract between the
parties, there would also be many other factors which
may require oral evidence, particularly with respect to the
comparable properties. An appropriate remedy, forum
and procedure are therefore, necessary in the interest of
C fairness and proper adjudication. That apart, there is no
reason to insist upon s1.1ch an interpretation which would
deny to the tena;nts of the public premises, a remedy and
a forum which are otherwise available to the tenants
under the MRC Act. [Para 70] [614-F-H; 615-A]

D 12.3. The interpretation as canvassed by the
respondents would deny the appropriate remedy to the
petitioner and the like tenants, to have the rent of their
premises being fixed by filing a Standard Rent
Application, and also to get the essential services
E restored in the event of any difficulty. There is no reason
to accept any such interpretation because there is no
conflict between the provisions of the MRC Act with those
under the Public Premises Act, when it comes to fixation
of standard rent and restoring the essential supplies.
F Otherwise it would expose the provisions of Public
Premises Act to the vires of unreasonableness also. The
interpretation canvassed by the respondents is not in
consonance with the welfare state that is contemplated
under the Constitution. [Para 71) [615-B-D]
G
Bharath Gold Mines Ltd. vs. Kannappa ILR 1988 KAR
3092 - approved.
13. The order passed by the Single Judge of the High
Court in writ petition filed by the respondents is set aside
H and the writ petition is dismissed. The order passed by
BANATWALA & COMPANY v. L.l.C. OF INDIA-~ ANR. 551.

the Court of Small Causes rejecting respondents' A
application objecting to the maintainability of appellant's
application for fixation of Standard Rent is upheld. [Para
73] [616-D-E]
Persis Kothawala vs. UC 2004 (4) BCR 610; Shangrila
Food Products Ltd. and Anr. Vs. L./.C. and Anr. 1996 (5) SCC B
54: 1996 (3) Suppl. SCR 279: New India Assurance Co. Ltd.
Vs. Nus/i Neville Wadia 2008 (3) SCC 279: 2007 (13) SCR
598 - referred to.
Case Law Reference: c
1990 (3) SCR 649 Referred to Para 26, 28, 30,
31, 60
1976 Suppl. SCR 87 Referred to Para 27
1977 (2) SCR 421 Referred to Para 29 D

2002 (2) Suppl. SCR 555 Relied on. Para 32
2006 (3) Suppl. SCR 240 Relied on. Para 32
1983 (3) SCR 130 Referred to Para 35 E
2004 (1) SCR 564 Referred to Para 35
1956 SCR 393 Referred to Para 36
.
1979 (3) SCR 254 Referred to Para 37
F
1959 (2) Suppl. SCR 8 Referred to Para 37
1990 (1) SCR 614 Referred· to Para 38
1987 (3) SCR 728 Referred to ·Para 39
G
1988 Supp. sec 82 Referred to Para 40, 64
2004 (1) SCR 284 Relied on. Para 40, 62
2008 (12) SCR 1083 Referred to Para 41
2010 (4) SCR 1042 Referred to Para 41 H
552 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A 1951 SCR 682 Referred to Para 43
1950 SCR 869 Referred to Para 43
2004 (4) BCR 61 Referred to Para 46
AIR 1992 Born 375 Referred to Para 47
B
ILR 1988 KAR 3092 Approved Para 48, 62 and
71
1996 (3) Suppl. SCR 279 Referred to Para 49
c 2009 (16) SCR 736 Referred to Para 54
2005 (3) SCR 1037 Referred to Para 55, 63
1968 SCR 662 Referred to Para 55

D
2007 (13) SCR 598 Referred to Para 57
1981 (1) SCR 498 ·Relied on Para 62
AIR 1953 Born 170 Relied on Para 66
1954 SCR 572 Relied on. Para 66
E
1989 (2) SCR 751 Relied on. Para 66

CIVIL APPELLATE JURISDICTION : Civil Appeal No.
7171 of 2010.

F From the Judgment & Order dated 8.9.2009 of the High
Court of Bombay in WP No. 5023 of 2009.

Vijay Hansaria, Sanjay Sarin, Manoj 8. Dalvi, Rehana A.
Kesuri, Senha Gagandeep Kaur and Manjusha Wadhwa for the
Appellant.
G
H.P. Raval, ASG, Indra Sawhaney for the Respondent.

The Judgment of the Court was delivered by

H.L. GOKHALE J. 1. This appeal, by Special leave raises
H
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 553
[H.L. GOKHALE, J.]
a question as to whether the provisions for fixation of standard A
rent, and provisions prescribing other obligations for the landlord
such as maintenance of essential services under the concerned
Rent Control Act viz. Maharashtra Rent Control Act, 1999 as in
the present case (hereinafter referred to as the MRC Act}, are
applicable in respect of public premises owned by a corporation
8
such as the first respondent Life Insurance Corporation of India
(L.l.C in short) which is otherwise covered by the provisions of
the Public Premises (Eviction of Unauthorized Occupants) Act,
1971 (hereinafter referred to as the Public Premises Act).

Short facts leading to this appeal are as follows - C

2. The appellant is a firm of Advocates and Solicitors, and .
is a tenant in possession of 5th floor of a seven storey building,
situated at 269 D.N. Road, Fort Mumbai owned by the first
Respondent, L.l.C. L.l.C. is a statutory corporation constituted 0
under the Life Insurance Corporation Act, 1956. The area under
occupation of the appellant is 1289.16 sq. feet (equivalent to
113 sq. metres). The petitioner is a tenant of these premises
since 1st August, 1988 under an agreement of lease which has
been extended from time to time. It is relevant to note that there E
are no proceedings of eviction filed by the respondent No, 1
against the appellant. The second respondent is the Regional
Manager (estates) of L.l.C.

3. The respondent No. ? revised the monthly rent of these
premises suddenly by his letter of 14th July, 2004 from Rs. F
6,891/- to Rs. 39,069/-, including Municipal taxes and
miscellaneous charges. The appellant filed a Writ Petition in the
Bombay High Court being Writ Petition No. 2266 of 2004 to
·challenge the increasing of rent as arbi~rary. The respondents
made a statement in the High Court that if the petitioner abides G
by clause IV (e) of the lease agreement between the parties and
pays increased rent as provided therein, the respondents will
not enforce the increase in the rent that was proposed through
letter dated 14.7.2001. Thereupon the writ petition was
withdrawn. Subsequently, the respondents sent a reduced bill H
554 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A of Rs. 9144/- per month which included basic rent of Rs. 6181/
- plus municipal taxes and water charges of Rs. 355/- and misc.
charges of Rs. 100/-. We place the above clause IV (e) on
record. It reads as follows:-

"(e) The Lessor doth hereby convenant with the Lessee
B that upon the Lessee paying the rent hereby reserved
. regularly and observing and performing all the convenants
and conditions herein contained, the Lessor shall on
Lessee's request extend the period of the lease on the
same terms and conditions not exceeding five years from
c the expiration of the terms hereby granted subject however
that there will be an escalation/increase in the rent hereby
reserved by 35% of the rate mentioned hereinabove."

4. It so transpired that the lift of the building (wherein these
o premises are situated) was not working properly, and hence,
sometime in 2007, the appellant, alongwith two other tenants,
filed an application bearing R.E.S. Application No.48/Res of
2007 in the Small Causes Court, Mumbai for restoration of the
lift services under Section 29 of the MRC Act. A Single Judge
E of that Court who heard an Interim application therein, directed
the respondents by his order dated 3.10.2007 to repair the lift.
A revision petition bearing Revision Application No.308/2007
was filed by the respondents to challenge that order. The
submission of the respondents, that the MRC Act was not
F applicable, was turned down by a Division Bench of that Court,
which dismissed that petition by its order dated 11.1.2008. In
the meanwhile, in April, 2007 the respondents further decreased
the rent from Rs. 9144/- to Rs. 6891/- per month.

5. The monthly rent for the premises, however continued
G to be uncertain. The respondents increased the rent for the
premises once again in March, 2008 to Rs. 8689/-. In April,
2008 they demanded rent of Rs. 25,063/- on the basis that the
rateable value of the building had been raised by the Mumbai
Municipal Corporation from the month of April, 2006 onwards
H from Rs. 17,895/- to Rs. 1,21,805/-. The appellant was called
BANAlWALA & COMPANY v. L.l.G. OF INDIA & ANR. 555
[H.L. GOKHALE, J.]
'
upon to pay the arrears of rent also from April 2006 amounting A
',to Rs. 8,89,503/-. ...

6. The appellant therefore asked for the break up of the
rent bill by their letter dated 2.4.?008. Since no reply was
received, appellant filed an Application (registered as RAN
8
application No.24/SR/08) under Section 8 (3) of the MRC Act
in the Court of Small Causes for fixation of standard rent, and
also filed an application for fixing interim rent. Respondents in
their tum challenged the jurisdiction of the Small Causes Court
to entertain the proceeding, and contended that the suit
prel'T,'lises were public premises qover,ed under th~ Public C
Premises Act, and the MRC Act did not apply to them. They
filed an application (exhibit 14) seeking? decision on that iss.ue
as a preliminary issue. The Small Caus~s Court, vide its order
dated 30.3.2009, rejected this application Exhibit 14 and held
that the. said Standard Rent Application was maintainable under D
the provisions of MRC Act. Being aggrieved by .that order, the
respondents ·filed a Writ Petition invoking. Art_icle 227 of. the
Constitution of India in the Bombay High Court bearing Writ
Petition No. 5023 of 2009. •. . ·
E
7. A Learned Single Judge of the High Court who. heard
the matter, accepted the contention raised by the respondents,
and allowed the petition by hls order dated 8.9.2009. Thereby,
he set-aside the said order:dated 30.3.2009 ·and dismissed
the Standard Rent Appl_ipatiori. ·Be!n'g ·aggdeyed that by F
judgment and order, this·Appearby way of spedal leave has
been ni~CI: 'Mr. Vijay i-latisaria, Sr. Advocate' appeared fbr° the
appellant, and Mr. H.P. Rawal, Additionai Solicitor General
appeared for the respondents.. .
. . ' .' . ~ ·~
: '> . r
G
Rival Submissions. in a !lutshell : ·
.... v • ' • • ~..

8. The· learned coun~el ·for
·the appellant submitted ttiat
. under Section 3 ·(1 )·(a) of the' MRC ·Act; 'only the premises
belonging to the Government Oi"a local authority are exempted
. from the application of the Act. ·The MRC Act covers five· H
556 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A subjects viz. (i) control of rent, (ii) repairs of certain premises,
(iii) eviction, (iv) encouraging the construction of new houses
by assuring of fair return on the investment to the landlord, and
(v) matters cc;mnected with the aforesaid purposes. It was
submitted that on the other hand, the Public Premises Act
B provided only for the third subject out of these five subjects viz.
(iii) eviction of unauthorized occupants from public premises
and for certain incidental matters including recovery of arrears
of rent from the tenant The MRC Act contains a specific
chapter namely Chapter II regarding the fixation of standard rent
c and permitted increases. Section 29 of the MRC Act lays down
the duty of the landlord not to cut off or withhold essential supply
or service enjoyed by ·the tenant, and provides for a remedy to
the tenant in the events of any breach of this duty by the landlord.
As against that, there is no provision in that behalf in the Public
D Premises Act. Mr. Hansaria, learned counsel for the appellant
submitted that in as much as there is no provision for fixation
of standard rent or restoration of essential services in the Public
Premises Act, and since the MRC Act is a subsequent Act, the
provisions of the MRC Act will have to be held as available to
E the tenants for these purposes. Mr. Hansaria, did not dispute
that the premises occupied by the appellant are public premises
within the definition of the concept of public premises under the
Public Premises Act. He did· not also dispute that in regard to
matters relating to eviction and recovery of arrears of rent, the
Public Premises .Act will .apply to applications by respondents
F against appellant. He however, c.ontellded that for (he purpose
of fixation of standard rent of the premises of the appellant, the
MRC Act will apply.
9. As against this, the submission of Mr. H.P. Rawal,
G Additional Solicitor General, was that the concept of standard
rent was foreign to the Public Premises Act, and should not be
permitted to be applied to the public premises by permitting
applications under the .MRC _Act for th.at purpose, particularly
when the Parliament has not made any provision in this behalf
H in the Public Premises Act. That apart, according to the
BANATWALA & COMPANY v. ~.l.C. OF INDIA & ANR. 557
[H.L. GOKHALE, J.]
respondents they were seeking to recover the permitted A
· • increases on account of increase in the ratable value of the
building by the Mumbai Municipal Corporation, which was
being disputed by the appellant. With a view to appreciate
these rival submissions, we shall look into the general principles
governing the relationship between landlord and tenants, and
8
relevant provisions of the MRC Act as well as the Public
Premises Act.

Relationship of landlord and tenant in general -

10. A 'lease' is defined in Section 105 of Transfer of C
Property Act, 1882 (in short T.P. Act), thus:-

"105. Lease defined -A lease of immovable property is a
transfer of a right to enjoy such property, made for a certain
time, express or implied, or in perpetuity, in consideration
of a price paid or promised, or of money, a share of crops, D
service or any other thing of value, to be rendered
periodically or on specified occasions to the transferor by
the transferee, who accepts the transfer on such terms.

Lessor, lessee, premium and rent defined - The
transferor is called the lessor, the transferee is called the E
lessee, the price is called the premium, and the money,
share, service or other thing to be so rendered is called
the rent."

A tenancy is created as a result of an agreement between F.
the landlord and a tenant. Since the premises owned by the
l_andlord are leased out to the tenant by virtue of the agreement
between the parties, the agreement is normally called a 'lease
deed'. To put it in the words of Prof. P.F. Smith "The relationship
of landlord and tenant arises where one person, who G
possesses either a freehold or leasehold property interest
expressly or impliedly grants to another, by means of a
contract, an estate in that property which is less than the
freehold interest or for a shorter duration than the leasehold
interest of the grantor, as the case may be." (The Law of H
558 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

~ALandlord and Tenant, Fourth Edition, Page 9). Although, the
lease deed is also a contract between the parties, the
provisions of T.P. Act relating to contracts, shall be taken as
part of the Indian Contract Act, 1872 (vide Section 4 of T.P.
Act). As a 'lease deed' is a contract relating to 'leases'
8 governed by T.P. Act, the relationship between the landlord and
the tenant would be governed by the terms of the lease deed
and subject to its terms, by Section 108 relating to the rights
and liabilities of leasor and leasee, and other statutory
provisions controlling leases under the T.P. Act.
c 11. Generally, the terms of the agreement between the ·
landlord and the tenant would require the landlord to maintain
the premises in tenantable condition, and he will get the
premises repaired when necessary. The tenant will be required
to vacate the premises at the end of the period of lease. During
D the lease period, it will be the responsibility of the tenant to pay
the rent regularly and 'keep the premises in good condition
subject only to changes caused by reasonable wear and tear ·
or irresistible force' and 'when such defect has been caused
by any act or default on the part of the lessee, his servants or
E agents, he is bound to make it good within three months after
such notice has been given or left' (See Section 108 (m) ofT.P.
Act. If the tenant commits breaches of the lease agreement by
not paying the rent regularly or remaining in arrears thereof, or
causing damage to the premises, the landlord may terminate
F the lease earlier, even before the expiry of the agreed term as
per the provisions concerning the termination provided in the
agreement and the Transfer of Property Act. If the tenant does
not vacate the premises after the termination of lease, the
landlord will have to file a suit for evicting him in the Civil Court.
G 12. On the other hand 'if the lessor neglects to make, within
a reasonable time after notice, any repairs which he is bound
to make to the property, the lessee may make the same himself,
and deduct the expense of such repairs with interest from the
rent, or otherwise recover it from the lessor' (see Section 108
H
BANATWALA& COMPANY v. L.l.C. OF INDIA & ANR. 559
[H.L. GOKHALE, J.]

(f) of T.P. Act). Section 108. (I) of the T.P. Act lays down that A
'the lessee is bound to pay or tender, at the proper time and
place, the premium or rent to the lessor or his agent in this
behalf. This implies that the amount of rent that the landlord will
require shall be a certain definite amount.
B
The changes brought ab_out by the Rent Control Acts -
13. These general rules governing the relationship of the
landlord and the tenant have undergone a change after the
Second World War. There is a change in the economic
scenario world over, and the intervention of the welfare state C
in different walks of life became necessary. "Due to scarcity
of accommodation following the second World War, it was
found necessary to give special protection to tenants against
increase of rent and ejectment in supersession of the ordinary
law of landlord and tenant, embodied in the Transfer of D
Property Act." (The Law of Rent Control, by R.B. Andhyarujina,
Second Edition, Page 12). The shortage of residential houses
in urban areas led to the regulation of the relationship between
the landlord and the tenants by specific acts in that behalf. The
concept of standard rent arrived at after consi~ering the totality E
of the factors, came to control the rent to be charged by the
landlord. The landlord would not be entltled to charge in excess
of the standard rent, although the additions therein on account
of Municipal Taxes etc. became permissible. The. Bombay
Rents, Hotel and Lodging House Rates (Control) Act, 1947, F
(Bombay Rent Act for short) is one such legislation which is an
advancement over the Transfer of Property Act. This Act laid
down that a tenant will not be evicted unless the landlord
establishes that the tenant has committed breaches as laid
down under that Act, and the burden will be on the landlord to G
establish that the tenant has committed.the particular breach,
such as being in arrears of standard rent over a specified
period, erecting permanent structures on the premises without
landlord's permission, sub-letting the premises and causing
nuisance to the neighbours etc. A reasonable and bonafide
requirement of the landlord was also provided as a ground for H
560 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A eviction. If the landlord was charging rent excessively, a right
was given to the tenant to have the standard rent fixed unde'r
Section 11 of that act. A further right was given to the tenant to
approach the Court under Section 24 of that act for
maintenance and restoration of essential services in case the
B landlord neglected the same.

14. The first respondent L.l.C owns a large number of
properties in the city of Mumbai and elsewhere. Earlier, the
relationship between L.l.C as the landlord and its tenants was
C governed under the Bombay Rent Act 1947. The question is
as to what change has been brought about by the Public
Premises Act 1971, into this relationship? The Public Premises
Act 1971, provides only for eviction of unauthorized occupants,
and recovery of arrears of rent from the tenant. Can it therefore
be said that the other provisions of the Bombay Rent Act,
D ceased to apply to the tenancies which were earlier covered
thereunder? Or would it be proper to say that only the aspect
of the eviction and recovery of arrears of rent came to be
covered under the Public Premises Act? Can it be said that
because the Public Premises Act came to be applied in 1999,
E L.1.C could suddenly charge any rent as it deemed fit in excess
of the standard rent? Can it be said that the remedy for the
tenant for fixation of standard rent, and getting the essential
services restored when necessary by moving the Court was no
longer available merely because the Public Premises Act came
F to be applied? Does the Public Premises Act have an
overriding effect denying these remedies to the tenants for all
purposes?

15. The Bombay Rent Act came to be replaced by the
MRC Act 1999. The MRC Act is subsequent to the Public
G Premises Act, 1971, and has come into force with effect from
31.3.2000 after receiving the assent of the President of India.
Therefore, the subjects which were covered under the Bombay
Rent Act came to be covered under the MRC Act, 1999 as
appropriately modified including the concept of standard rent.
H Can it therefore not be said that as far as premises of L.l.C.
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 561
[H.L. GOKHALE, J.]
are concerned, on all other subjects excluding the subject of A
eviction of unauthorized occupants and recovery of arrears of
rent, the modified provisions under the MRC Act will apply
wherever the Bombay Rent Act was applicable?
16. As far as th.e petitioner is concerned, it occupied the B
suit premises in the year 1988 under an agreement of lease
with Ll.C, at which time the Public Premises Act as well as
Bombay Rent Act were in force. This agreement has been
~xtended from time to time. As stated above, the Bombay Rent
Act was replaced with effect from 31.3.2000 by the MRC Act.
Would it therefore not be correct to say that for aspects other C
than eviction, and recovery of arrears of rent. the relationship
between the petitioner and the respondent (which was earlier
governed by the Bombay Rent Act) will now be governed under
the MRC Act?
D
The Maharashtra Rent Control Act, 1999 -

17. The MRC Act consists of sixty sections which are
divided in nine separate chapters, Chapter (I) is on preliminary
provisions, Chapter (II) contains the provisions regarding fixation E
of standard rent and permitted increase, Chapter (Ill) contains
the provisions concerning relief against forfeiture, Chapter (IV)
is for recovery of possession, or eviction of the tenant by the
Landlord, Chapter (V) contains the special provisions. for
recovery of possession in certain cases such as where the
premises are owned by members of Armed Forces, Scientists F
etc, Chapter (VI) contains the provisions regarding sub-
tenancies and other matters concerning tenancies, Chapter (VII)
contains provisions regarding jurisdiction of the Courts, suits,
appeals, practice and procedure, Chapter (VIII) contains
provisions for the summary disposal of certain applications and G
Chapter (IX) contains the miscellaneous provisions.
1.8. As stated earlier, the preamble of MRC Act states that
it is an Act relating to five subjects, namely (i) control of rent,
(ii) repairs of certain premises; (iii) eviction, (iv) encouraging H
562 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A the construction of new houses by assuring fair return of
investment by the landlord, and (v) matters connected with the
purposes mentioned above. Section 2 of the act gives the
applicability of the act. Sub-section (1) thereof lays down that
in the first instance, the act applies to premises let for the
B purposes of residence, education, business, trade or storage,
and in the areas specified in Schedule I and Schedule II of the
Act. Schedule I and II mention the cities and towns to which this
Act applies.
19. Section 3 of MRC Act provides for the exemptions·
C from this Act. Whereas sub-section 1 (a) thereof excludes from
the application of this Act, the premises belonging to the
Government or a local authority, Sub-Section 1 (b) declines to
give protection of the provisions of this Act to certain tenants
where the tenants are banks, public sector undertakings, multi-
D national companies, private and public limited companies with
a share capital of more than Rs. 1 crore, etc. Section 4 gives
the power of the State Government to prescribe conditions for
exemption in respect of premises belonging to local authority.
We quote these two sections in their entirety.
E
"3. Exemption

(1) This Act shall not apply'--
(a) to any premises belonging to the Government or a
F local authority or apply as against the Government
to any tenancy, licence or other like relationship
created by a grant from or a licence given by the
Government in respect of premises requisitioned
or taken on lease or on licence by the Government,
G including any premises taken on behalf of the
Government on the basis of tenancy or of licence
or other like relationship by, or in the name of any
officer subordinate to the Government authorized in
this behalf, but it shall apply in respect of premises
let, or given on licence, to the Government or a local
H
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 563
[H.L. GOKHALE, J.]

authority or taken on behalf of the Government on A .
such basis by, or in the name of, such officer.

(b) To any premises let or sub-let to banks, or any
Public Sector Undertakings or any Corporation
established by or under any Central or State Act,
B
or for~ign missions, .international agencies,
iilultinational companies, and private limited
companies and public limited companies having a
paid up share capital of more than rupee one core
or more.
c
Explanation. For the purpose of this clause the expression
"bank" means,- ·

(i) the-State Bank of India constituted under the State
Bank of India Act, 1955;
D
· · (ii) · a subsidiary bank as defined in the State Bank of
India (Subsidiary Banks) Act, 1959;
(iii) . a correspondin·g new bank constituted under
section 3 of the Banking Companies (Acquisition E
and Transfer of Undertaking) Act, 1970 or under
section 3 of the B~nking- Cofylpanies ·(Acquisition
and Transfer
. . .
of Undertaking) Ad, 1980,
.
or

(iv)· any other bank, being a scheduled bank as defined
in clause (e} of section 2 of the Reserve Bank of F
India Act, 1934.

(2) The State Government may.direct thatall or any of ·
the provisions of this Act shall, subject to such
conditions and terms as it may specify, not apply- G
(i) to premises used for public purposes of a
' charitable nature or to any class of premises used
-: 'for such purposes;~ .
'"""· ' ~ ~ ... ·i ~

(ii) · to premises held by a public trust for a religious or H
564 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A charitable purpose and let at a nominal or
concessional rent;
(iii) to premises held by a public trust for a religious or
charitable purpose and administered by a local
authority; or
B
(iv) to premises belonging to or vested in an university
established by any law for the time being in force

Provided that, before issuing any direction under
c this sub-section, the State Government shall ensure
that the tenancy rights of the existing tenants are not
adversely affected.
(3) The expression "premises belonging to the
Government or a local authority' in sub-section (1)
D shall, notwithstanding anything contained in the said
sub-section or in any judgment, decree or order of
a court, nor include a building erected on any land
held by any person from the Government or a local
authority under an agreement, lease, licence or
E other grant, although having regard to the provisions
of such agreement, lease, licence or grant of
building so erected may belong or continue to
belong to the Government or the local authority, as
the case may be, and such person shall be entitled
F to create a tenancy in respect of such building or a
part thereof.
4. Power of State Government to issue orders
In respect of premises belonging to local
authority, etc.
G
Notwithstanding anything contained in this Act, the State
Government may, from time to time, by general or special
order, direct that the exemption granted to a local authority
under sub-section (1) of section 3 shall be subject to such
H conditions and terms as it may specify either generally or
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 565
[H.L. GOKHALE, J.]

specially in any particular case, as the State Government A
may in its direction determine.

20. Section 7 (6) of MRC Act defines the local authority
which includes cepain Municipal Corporations such as Mumbai
Municipal Corporation, Nagpur Municipal Corporation,
Municipal Councils constituted under the Maharashtra Municipal B
Council, Nagar Panchayats and Industrial Townships Act, 1965,
Zila Parishads and Panchayat Samitis, Village Panchayats,
Maharashtra Housing and Area Development Authority, City
and Industrial Development Corporation etc.
c
21. Section 2 (14) defines the standard rent. Section 6
states that provision with regard to standard rent will not apply
to certain premises which include, (a) buildings reconstructed
after demolishing the old building in the circumstances
mentioned in Sections 20 & 21 of the Act, and (b) the premises D
which are constructed or reconstructed in any housing scheme,
undertaken by Government of the Maharashtra Housing and
Area Development Authority or by any of its Boards established
under Section 18 of the Maharashtra Housing and Area
Development Act, 1976. Section 8 lays down that the Court E
may fix the standard rent and permitted increases, and Section
10 states that claiming rent in excess of standard rent is illegal.
Section 11 permits the increase in rent only on account of
improvements and special additions, or fbr heavy repairs.
Section 12 permits the increase in rent on account of payment
of rates to the public bodies. Section 14 lays down the duty of F
the landlord to keep the premises in good repairs. Section 29
lays down that the landlord shall not cut off or withhold essential
supplies or services and provides for the remedy to the tenant
against the same. Section 33 of the Act gives the jurisdiction
of Courts in that behalf. In Mumbai, the jurisdiction is with the G
Court of Small Causes.

22. Sections 2(14), 8 and 29 are relevant for our purpose.
They read as follows:-
H
566 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

· A "2 (14) "standard rent'', in relation to any premises -
means.-
(a) where the standard rent is fixed by the Court or, as the
case may be, the Controller under the Bombay Rent
Restriction Act 1939, or the Bombay Rents, Hotel Rates
B and Lodging House Rates (Control) Act, 1944 or the
Bombay Rents, Hotel and Lodging House Rates Contro!
Act, 1947, or the Central Provinces and Berar Letting of
Houses and Retnt Control Order, 1949 issued under the
Central Provinces and Berar Regulation of Letting of
c Accommodation Act, 1946, or the Hyderabad Houses
(Rent, Eviction and Lease) Control Act, 1954, such rent
plus an increase of 5 per cent, in the rent so fixed ; or

(b) where the standard rent or fair rent is not so fixed, then
subject to the provisions of sections 6 and 8. -
D
(i) the rent at which the premises were let on the 1st
day of October 1987; or

(ii) where the premises were not let on the 1st day
of October 1987, or the rent at which they were last
E
let before that day, plus an increase of 5 per cent,
in the rent of the pr~mises let before the 1st day of
October, 1987, or

(c) in any of the cases specified in section 8, the rent fixed
F by the court;

"8. Court mtiy fix standard rent and permitted
increases in certain cases
(1) Subject to the provisions of section 9 in any of the
G following cases, the court may, upon an application
made to it for the purpose, or in any suit or
proceedings, fix the standard rent at such amount
as, having regard to the provisions of this Act and
the circumstances of the case, the court deems
H just,-
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 567 '
[H.L. GOKHALE, J.]

(a) where the court is satisfied that there is no A
sufficient evidence to ascertain the rent at which the
premises were let in any one of the cases
· mentioned in paragraphs (i) and (ii) of sub-clause
(14) of section 7; or
B
(b) whereby reasons of the premises having been
let at one time as a whole or in parts and at another
time, in parts or as a whole, or for any other
reasons; or

(c) where any premises have been or are let rent- c
free or, at a nominal rent; or for some consideration
in addition to rent; or

(d) where there is any dispute between the landlord
and the tenant regarding the amount of standard
D
rent.

(2) If there is any dispute between the landlord and the
tenant regarding the amount of permitted increase,
the court may determine such amount.
E
(3) If any application for fixing the standard rent or for
determining the permitted increase is made by a
tenant,-

(a) the court shall forthwith specify the amount of
rent, or permitted increase which are to be F
deposited in court by the tenant, and make an order
directing the tenant to deposit such amount in court
or, at the option of the tenant, make an order to pay
to the landlord such amount thereof as the court
may specify pending the final decision of the G
application. A copy of the order shall be served
upon the landlord;

(b) out of any amount deposited in the court under
clause (a), the court may make an order for payment
H
568 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A of such reasonable sum to the landlord towards
payment of the rent or increases due to him as it
thinks fit;
(c) if the tenant fails to deposit such amount or,
as the case may be, to pay such amount thereof to
B
the landlord, his application shall be dismissed.

(4) (a) Where at any stage of a suit for recovery of
rent, whether with or without a claim for possession,
of the premises, the court is satisfied that the rent
C is excessive and standard rent should be fixed, the
court may, and in any other case, if it appears to
the court that it is just and proper to make such an
order, the court may make an order directing the
tenant to deposit in court forthwith such amount of
o the rent as the court considers to be reasonable due
to the landlord, or at the option of the tenant, an
order directing him to pay to the landlord such
amount thereof as the court may specify.

(b) The court may further make an order directing
E the tenant to deposit in court periodically such
amount as it considers proper as interim standard
rent, or at the option of the tenant, an order to pay
to the landlord, such amount thereof as the court
may specify, during the pendency of the suit;
F
(c) The court may also direct that if the tenant fails
to comply with any order made as aforesaid, within
such time as may be allowed by it, he shall not be
entitled to appear in or defend the suit except with
G leave of tlie court, which leave may be granted
subject to such terms and conditions as the court
may specify.
(5) No appeal shall lie from any order of the court·
under sub-sections (3) and (4).
H
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 569
[H.L. GOKHALE, J.]

(6) An application under this section may be made A
jointly by all or any of the tenants interested in
respect of the premises situated in the same
building.

29. Landlord not to cut-off or withhold essential supply or
8
service

(1) No landlord, either himself or through any person acting
or purporting to act on his behalf, shall, without just or
sufficient cause, cut-off or withhold any essential supply or
service enjoyed by the tenant in respect of the premises C
let to him.

(2) A tenant in occupation of the premises may, if the
landlord has contravened the provisions of sub-section (1),
make an application to the court for a direction to restore
0
such supply or service. ·

(3) Having regard to the circumstances of a particular case
the court, may, if it is satisfied that it is necessary to make
an interim order, make such order directing the landlord
to restore the essential supply or service before the date E
specified in such order, before giving notice to the landlord
of the enquiry to be made in the application under sub-
section (3) or during the pendency of such enquiry. On the
failure of the landlord to comply with such interim order of
the court, the landlord shall be liable to the same penalty F
as is provided for in sub-section (4).

(4) If the court on inquiry fil'.lds that the tenant has been in
enjoyment of the essential supply or service and that it was
cut-off or withheld by the landlord without just or sufficient
cause, the court shall make an order directing the landlord, G
to restore such supply or service before a date to be
specified in the order. Any landlord who fails, to restore
the supply or service before the date so specified, shall,
for each day during which the default continues thereafter,
be liable upon further directions by the court to that effect, H
570 SUPREME COURT REPORTS [2011) 14 (ADDL.) S.C.R.

A to fine which may extend to one hundred rupees.
(5) Any landlord, who contravenes, the provisions of sub-
section (1), shall, on conviction, be punishable with
imprisonment for a term which may extend to three months
or with fine which may extend to one thousand rupees or
B
with both.
(6) An application under this section may be made jointly
by all or any of the tenants of the premises situation in the
same building.
c
Explanation - In this section, -
(a) essential supply or service includes supply of
water, electricity, lights in passages and on stair-cases, lifts
and conservancy or sanitary service;
D
(b) withholding any essential supply or service shall
include acts or omissions attributable to the landlord on
account of which the essential supply or services is cut-
off by the municipal authority or any other competent
E authority.
(7) Without prejudice to the provisions of sub-sections (1)
to (6) or any other law for the time being in force, where
the tenant, -
F (a) who has been in enjoyment of any essential
supply or service and-the landlord has withheld the same,
or
(b) who desires to have, at his own cost, any other
essential supply or service for the premises in his
G occupation,
the tenant may apply to the Municipal or any other authority
authorized in this behalf, for the permission or for supply
of the essential service and it shall be lawful for that
H authority to grant permission for, supply of such essential
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 571
[H.L. GOKHALE, J.]

supply or service applied for without insisting on production A
of a "No Objection Certificate" from the landlord by such
tenant." ·

· The Public Premises Act (Eviction of Unauthorised Occupants)
Act, 1971-
B
23. Now, when we turn to the Public Premises Act, the
preamble. of the Act states that it is an Act to provide for the
eviction of unauthorized occupants from public premises and
for certain incidental matters. It was enacted to deal with the
problem of rampant unauthorised occupation of public premises C
by providing a speedy machinery for the recovery of these
premises and the arrears of rent from the occupants thereof.
Section 2 (e) of this Act defines the public premises, Section 2
(f) defines rent, and Section 2 (g) defines unauthorized
occupation. Section 2 (g) is in two parts. The first part of the D
said section states, that it means the occupation by any person
of the public premises without any authority for such occupation.
The second part is inclusive in nature, and it expressly covers
the continuation in occupation by any person of the public
premises after his authority to occupy the same has expired or E
has been determined for any reason whatsoever. These
sections read as follows:-

2(e) "public premises" means-

(1) any premises belonging to, or taken on lease or F
requisitioned by, or on behalf of the Central
Government, and includes any such premises which
have been placed by that Government, whether
before or after the commencement of the Public
Premises (Eviction of Unauthorised Occupants) G
Amendment Act, 1980 (61 of 1980), under the
control of the Secretariat of either House of
Parliament for providing residential accommodation
to any member of the staff of that Secretariat;
H
572 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A (2) any premises belonging to, or taken on lease by, -
or on behalf of,-

(i) any company as defined in section 3 of the
Companies Act, 1956 (1 of 1956), in which
not less than fifty-one per cent of the paid up
B
share capital is held by the Central
Government or any company which is a
subsidiary (within the meaning of that Act) of
the first-mentioned company;

c (ii) any corporation (not being a company as
defined in section 3 of the Companies Act,
1956 (1 of 1956) or a local authority)
established by or under a Central Act and
owned or controlled by the Central
D Government;

(iii) any University established or incorporated by
any Central Act.

(iv) any Institute incorporated by the Institutes of
E Technology Act, 1961 (59 of 1961);

(v) any Board of Trustees constituted under the
Major Port Trusts Act, 1963 (38 of 1963);

(vi) the Bhakra Management Board constituted
F under section 79 of the Punjab
Reorganisation Act, 1966 (31 of 1966), and
that Board as and when re-named as the
Bhakra-Beas Management Board under
sub-section (6 of section 80 of that Act;
G
(vii) any State Government or the Government of
any Union Territory situated in the National
Capital Territory of Delhi or in any other
Union Territory;
H
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 573
[H.L. GOKHALE, J.]

(viii) any Cantonment Board constituted under the A
Cantonments Act, 1924 (2 of 1924); and

(3) in relation to the [National Capital Territory of Delhi]-

(i) any premises belonging to the Municipal
Corporation of Delhi, or any Municipal B
Committee or notified area committee;

(ii) any premises belonging to the Delhi
Development Authority, whether such
premises are in the possession of, or leased c
out by, the said Authority; and

(iii) any premises belonging to, or taken on lease
or requisitioned by, or on behalf of any State
Government or the Government of any Union
Territory;] D

2(f) "rent", in relation to any public premises, means the
consideration payable periodically for the
authorized occupation of the premises, and
includes,- E
(i) any charge for electricity, water or any other
services in connection with the occupation of
the premises,

(ii) any tax (by whatever name called) .payable F
in respect of the premises,

where such charge or tax is payable by the Central
Government or the corporate authority,

2(g) "unauthorized occupation", in relation to any public G
premises, means the occupation by any person of
the public premises without authority for such
occupation, and includes the continuance in
occupation by any person of the public premises
after the authority (whether by way of grant or any H
574 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A other mode of transfer) under which he was allowed
to occupy the premises has expired or has been
determined for any reason whatsoever."

24. Section 3 of the Public Premises Act provides for the
appointment of estate officers who have the authority to hold
8 inquiries under this Act, Section 4 provides for issuance of
show cause notice, which proposes an order of eviction.
Section 5 provides for the inquiry in pursuance to the show
cause notice, and the order of eviction to be passed thereafter.
Section 7 deals with the power of the estate officer to pass
C orders concerning arrears of rent and damages in respect of
unauthorized occupation, Section 9 provides for appeals
against the order of the estate officers to the Appellate officer
who shall be the District Judge of the District. Section 14
provides for the recovery of rent as arrears of land revenue, and
D Section 15 for the bar of jurisdiction of courts to entertain any
suit or proceeding in respect of the matters mentioned in the
Section. Thus, it is an act for speedy recovery of public
premises and arrears of rent from the unauthorized occupants,
and it provides a separate mechanism for the same. Section
E 5, 7 and 15 of this Act are relevant for our purpose. These
sections read as follows:-

Section 5 - Eviction of unauthorised occupants

(1) If, after considering the cause, if any, shown by
F any person in pursuance of a notice under section 4 and
any evidence produced by him in support of the same and
after personal hearing, if any, given under clause (b) of
sub-section (2) of section 4], the estate officer is satisfied
that the public premises are in unauthorised occupation,
G the estate officer may make an order Clf eviction, for
reasons to be recorded therein, directino that the public
premises shall be vacated, on such date as may be
specified in the order, by all persons who may be in
occupation thereof or any part thereof, and cause a copy
H of the order to be affixed on the outer door or some other
BANATWALA & COMPANY v. L.l.C. OF !NOIA & ANR. 575
[H.L. GOKHALE, J.]
conspicuous part of the public premises. A

(2) If any person refused or fails to comply with the
order of eviction [on or before, the date specified in the
said order or within fifteen days of its publication under sub-
section(1) whichever is later,] the estate officer or any other
8
officer duly authorized by the estate officer in this behalf
may evict that person from, and take possession of, the
public premises and may, for that purpose, use such force
as may be necessary .

. Section 7 - Power to require payment of rent or damages C
in respect of public premises

(1) Where any person, is in arrears of rent payable in
respect of any public premises, the estate officer may, by
order, require that person to pay the same within such time
0
and in such installments as may be specified in the order.

(2) Where any person is, or has at anytime been, in
unauthorised occupation of any public premises, the estate
officer may, having regard to such principles of
assessment of damages as may be prescribed, assess E
the damages on account of the use and occupation of such
premises and may, by order, require that person to pay
the damages within such time and in such instalments as
may be specified in the order.

1 [(2A) While making an order under sub-section (1) or F
sub-section (2), the estate officer may direct that the
arrears of rent or, as the case may be, damages shall be
payable together with simple interest at such rate as may
be prescribed, not being a rate exceeding the current rate .
of interest within the meaning of the interest Act, 1978.] G

(3) No order under sub-section (1) or sub-section (2) shall
be made against any person until after the issue of a notice
in writing to the person calling upon him to show cause
within such time· as may be specified in the notice, why H
S76 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A such order should not be made, and until his objections, if
any, and any evidence he may produce in support of the
same, have been considered by the estate officer.

Section 15 - Bar of jurisdiction

8 No Court shall have jurisdiction to entertain any suit or
proceeding in respect of-

(a) the eviction of any person who is in unauthorised
occupation of any public premises, or
c (b) the removal of any building, structure or fixture
or goods, cattle or other animal from any public
premises under Section SA, or

(c) the demolition of any building or other structure
D made, or ordered to be made, under Section S8,
or

[(cc) the sealing of any erection or work or of any
public premises under Section SC, or]

E (d) the arrears of rent payable under sub-section (1)
of section 7 or damages payable under subsection
(2), or interest payable under sub-section (2A); of
that section, or

(e) the recovery of-
F
(i) costs of removal of any building, s~ructure or
fixture or goods, cattle or other animal under
Section SA, or

(ii) expenses of demolition under Section S8, or (iii)
G
costs awarded to the Central Government or
statutory authority under sub-section {5) of section
9, or (iv) any portion of such rent, damages, costs
of removal, expenses of demolition or costs
awarded to the Central Government or the statutory
H authority.]
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 577
[H.L. GOKHALE, J.]
Order passed by the Small Causes Court:- A
25. Reverting to the order passed by the Small Causes
Court, it is seen that it dismissed the application exhibit 14 filed
by the respondent principally for the following reasons:-

(i) The public premises are not specifically exempted B
from the applicability of the MRC Act;

(ii) Since an application for fixation of standard rent is
not a proceeding for eviction of a tenant, Small
Causes Court can entertain it;
c
(iii) The respondent, LIC has framed guidelines for
charging rent. These guidelines have a statutory
force under Section 21 of the LIC Act. They require
LIC to charge reasonable rent, and therefore the
Bombay High Court has in Writ Petition No.2436 D
of 2003 (Persis Kothawala Versus UC) held that
these guidelines are binding on LIC. On that basis,
the standard rent application would be
maintainable.
E
(iv) Section 3 of the MRC Act does not exempt LIC and
hence the provisions of MRC Act are applicable to
its premises.

(v) Merely because the premises were covered under
the Public Premises Act, the jurisdiction to entertain F
the Standard Rent Application under the MRC Act
was not ousted. There was no conflict between the
two Acts for that purpose.

The impugned judgment of the High Court and its reliance G
on the constitution bench judgment in Ashoka Marketing Ltd.

26. The learned Single Judge who decided the petition
principally relied upon the judgment of a constitution bench of
this Court in Ashoka Marketing Ltd. and Another Versus H
578 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A Punjab National Bank and Others [1990 (4) SCC 406], in
support of his view. This judgment decided four Civil Appeals
concerning the properties of four respondents situated in Delhi.
Two of them were concerning the properties of Punjab National
Bank, one of Union of India and one of LIC. In all these matters
B the respondents had initiated actions for eviction under the
Public Premises Act. The question in those appeals was
whether the occupants could be evicted under the Public
Premises Act, or whether they could invoke the protection of
Delhi Rent Control Act, 1958. This Court held that the
C proceedings under the Public Premises Act were valid and
legal. Relying on this judgment the High Court held that in the
present case the Public Premises Act will govern the field, and
the Standard Rent Application was not maintainable. The
learned Judge has observed in para 17 of the impugned
judgment as follows:-
0
"There may not be a provision in the said Act of 1971 for
fixing standard rent but there are provisions in the said Act
of 1971 which empower the authorities to pass an order
for recovery of rent and/or compensation from the tenant".
E
This is a reference to the power of the estate officer under
section 7 of the Public Premises Act for recovery of rent.
Section 7(2) empowers the estate officer to assess the
damages on account of use and occupation of the public
F premises by an unauthorized occupant. This assessment is to
be made having regard to the principles that may be prescribed
under the rules. This power is entirely different from the authority
to fix the standard rent, which is no where provided in the Public
Premises Act. Thus, this is not an answer to the issue raised
before the learned Judge, viz. as to whether a standard rent
G application under the concerned Rent Control Act was
maintainable, when there is no specific provision for the same
under the Public Premises Act.

27. Besides, section 7 of the Act is a procedural provision
H as held by this Court in New Delhi Municipal Committee Vs.
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 579
[H.L. GOKHALE, J.]
, Kalu Ram & Anr. reported in [AIR 1976 SC 1637] equivalent A
to [1976 (3) SCC 407]. In that matter the Municipality had
contended that section 7 permitted it to recover arrears of rent
which were even time barred. This Court rejected the contention
and held that it was only a section for providing a special
procedure for realization of arrears of rent, and which was a B
summary procedure. It did not constitute a source or foundation
of a right to claim a debt which was otherwise time barred. The
Learned Judge has, however, tried to get over this position by
relying upon Section 15 of the Public Premises Act as follows:-

"Apart from that, in view of the overriding effect of the said C
Act of 1971, an occupant of the public premises cannot
claim protection under the Rent Control Legislation in as
much as section 15 of the said Act of 1971 ousts the
jurisdiction of the Courts under the Rent Control Legislation
to deal with the matter of recovery of rent in respect of D
public premises."

Again, it is difficult to say that this approach is a correct
one. That is because the High Court was not concerned with
the recovery of arrears of rent by a public authority, an action E
against which would get ousted in view the provision of section
15 of the Public Premises Act, as also one against eviction.
The question is whether a tenant's application for fixation of
Standard Rent would get ousted. The respondents are claiming
that what they are charging are permissible increases, whereas F
the appellant contends that what is charged is in excess of what
should be the Standard Rent, and for that purpose it has filed
an application for fixation of Standard Rent under the MRC Act.
Would it, not be maintainable under that act?

28. In Ashoka Marketing, this Court noted that the rent G
control legislation would fall within the ambit of entries 6, 7 and
13 of List Ill (Concurrent List). The Public Premises Act would
otherwise fall under entry 32 of List I being a law with respect
to the property of Union of India. However, in relation to the
properties belonging to the various legal entities, mentioned in H
580 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

- Aclauses (2) and (3) of Section 2 (e), the Public Premises Act
would be covered under entries 6, 7 and 46 of List Ill. The Court,
therefore, noted that both the statutes were enacted by the
same legislature I.e. Parliament, in exercise of its legislative
power in respect of matters enumerated in the concurrent list.
B It was, therefore, of the opinion that the question as to whether
the Public Premises Act will override the Rent Control Act will
have to be considered in the light of the principles of statutory
interpretation applicable to the laws made by the same
legislature. Having said that, the constitution bench noted the
c relevant principles in this behalf in paragraph 50 as follows:-
"50. One such principle of statutory interpretation which is
applied is contained in the latin maxim : leges posteriors
priores conterarias abrogant (later laws abrogate earlier
contrary laws). This principle is subject to the exception
D embodied in the maxim : generalia specialibus non
derogant (a general provision does not derogate from a
special one.) This means that where the literal meaning of
the general enactment covers a situation for which specific
provision is made by another enactment contained in the
E earlier Act, it is presumed that the situation was intended
to continue to be dealt with by the specific provision rather
than the alter general one (Bennion, Statutory Interpretation
pp. 433-34)."

F The Court, therefore, examined the schemes of the two
enactments, and noted the features of the two enactments in
para 55 as follows:-

"55.(i) The Rent Control Act makes a departure from the
general law regulating the relationship of landlord and
G tenant contained in the Transfer of Property Act inasmuch
as it makes provision for determination of standard rent,
it specifies the grounds on which a landlord can seek the
eviction of a tenant, it prescribes the forum for adjudication
of disputes between landlords and tenants and the
H procedure which has to be followed in such proceedings.
BANATWALA & COMPANY v. L.1.C. OF INDIA & ANR. 581
[H.L. GOKHALE, J.]
The Rent Control Act can, therefore, be said to be a A
special statute regulating the relationship of landlord and
tenant in the Union Territory of Delhi. (ii) The Public
Premises Act makes provision for a speedy machinery to
secure eviction of unauthorised occupants from public
premises. As opposed to the general law which provides B
for filing of a regular suit for recovery of possession of
property in a competent court and for trial of such a suit in
accordance with the procedure laid down in the Code of
Civil Procedure, the Public Premises Act confers the
power to pass an order of eviction of an unauthorized c
occupant in a public premises on a designated officer and
prescribes the procedure to be followed by the said officer
before passing such an order.
"(iii) Therefore, the Public Premises Act is also a special
statute relating to eviction of unauthorized occupants from
0
public premises. In other words, both the enactments,
namely, the Rent Control Act and the Public Premises Act,
are special statutes in relation to the matters dealt with
therein." ...... (nos. to sub-paragraphs supplied)

Having noted the distinctive features of the two acts, the Court E
held that the principle that a subsequent general law cannot
derogate from an earlier special law could not be invoked in
that case because the later act, namely, Public Premises Act
was also special statute and not a general enactment.
Therefore, it further held that the Public Premises Act must p
prevail over the Rent Control Act in accordance with the
principle that the later laws abrogate earlier contrary laws.

29. In view of the fact that both the enactments had non-
obstante clauses, a reference was made to an earlier judgment
of a bench of three judges on such a situation in the case of G
Shri Sarwan Singh and another Versus Shri Kasturi Lal
reported in 1977 (1) sec 750. lri that mater the question
before the Court was whether provisions of Slum Areas
(Improvement and Clearance) Act, 1956 will override those of
the Delhi Rent Control Act, 1958. If so, no person can initiate H
582 SUPREME COURT REPORTS (2011] 14 (ADDL.) S.C.R.

A any suit or proceeding for eviction of a tenant from any building
or land in slum area without the permission in writing of the
competent authority under the Slum Act. The respondent in that
matter was a government employee and was staying in a
quarter allotted to him, and he was asked to vacate this quarter
B on the ground that he owned another residential house. The
house constructed by him was occupied by the appellant and
it was in an area covered under the Slum Act. On being asked
to vacate the quarter, the respondent gave a notice to the
appellant to vacate his premises, and followed it up by filing an
c application under the Rent Control Act. The appellant pleaded
that he cannot be asked to vacate unless permission from the
authority under the Slum Clearance Act was obtained. This
Court noted that although Section 19 (1) of the Slum Clearance
Act required a permission of the competent authority before
instituting proceeding for eviction of a tenant, notwithstanding
0
that provision, by an amendment Section 14-A and Chapter 111-
A were brought into Delhi Rent Control Act. The Court examined
the schemes of the two acts and then held that the provision of
the Delhi Rent Control Act had to be given precedence, as in
the present case although the government servant is asked to
E vacate his quarter, he will not be able to proceed against his
tenant unless he obtains the permission from the Slum
Clearance Authority. It is to obviate such difficulty that the
amendment in the Delhi Rent Control Act had been brought in.
In that context it was observed in para 20 as follows:-
F
"20 ......... When two or more laws operate in the same field
and each contains a non-obstante clause stating that its
provisions will override thqse of any other law, stimulating
and incisive problems of interpretation arise. Since
G statutory interpretation has no conventional protocol,
cases of such conflict have to be decided in reference to
the object and purpose of the laws under
consideration ...... "

(emphasis supplied)
H
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 583
[H.L. GOKHALE, J.]
Therefore, the Court concluded in para 23 as follows:- A

"23. ...... Bearing in mind the language of the two laws,
their object and purpose, and the fact that one of them is
later in point of time and was enacted with the knowledge
of the non-obstante clauses in the earlier law, we have
8
come to the conclusion that the provisions of Section 14A
and Chapter lllA of the Rent ControlActmust prevail over
those contained in Sections 19 and 39 of the Slum
Clearance Act."

30. Accordingly, in the context of the conflict between the C
two Acts, this Court held in Ashoka Marketing, as follows:-

"61. The principle which emerges from these decisionl is .
that in the case of inconsistency between the provisions
of two enactments, both of which can be regarded as
0
special in nature, the conflict has to be resolved by
reference to the purpose and policy underlying the two
enactments and the clear intendment conveyed by the
language of the relevant provisions therein."

It becomes relevant to note the conclusion arrived at by this E
Court in Ashoka Marking Co. 's case, which is in following
words:-

"70. For the reasons aforesaid, we are unable to accept
the contention of the learned counsel for the petitioners that F
the provisions contained in the Public Premises Act cannot
be applied to premises which fall within the ambit of the
Rent Control Act. In our opinion, the provisions of the
Public Premises Act, to the extent they cover premises
falling within the ambit of the Rent Control Act, override G
the provisions of the Rent Control Act and a person in
unauthorized occupation of public premises under Section
2(e) of the Act cannot invoke the protection of the Rent
G"'1trol Act." ... (emphasis supplied) ·

31. The impugned judgment in the present case relies H
584 SUPREME COURT REPORTS (2011] 14 (ADDL.) S.C.R.

A upon the above observations to hold that once the premises
were covered under the Public Premises Act, that Act will
override the Rent Control Act and therefore in the instant case,
standard rent application was not maintainable. On the other
hand, it was submitted on behalf of the appellant that the above
B statement in paragraph 70 of Ashoka Marketing Judgment,
when it speaks of 'provisions to the extent they cover', it means
the 'subject matter' covered by the provisions under the two
acts. In this context, it must also be noted that the controversy
in the case of Ashoka Marketing was with respect to the subject
c of eviction of the unauthorized occupants from the public
premises. Eviction of tenants in general was a subject covered
by both the statutes under considerations before the Court.
However, the Public Premises Act contains the special
provisions for the eviction of unauthorized occupants from the
0 public premises, but for which they would fall within the ambit
of the Rent Control Act. Consequently, in view of the above
dicta, the proceedings under the Public Premises Act were
held to be valid and legal, and not those under the Delhi Rent
Control Act. The subject matter of controversy'in our case is
E with respect to the fixation of standard rent, which is not covered
under the provision in the Public Premises Act. On the other
hand the same is very much covered under the MRC Act. The
overriding effect given to Public Premises Act cannot mean
overriding with reference to a matter which was not dealt with
by that Act, since the Public Premises Act did not claim to
F cover the subject other than eviction of unauthorized occupants
fror:n public premises and recovery of arrears of rent. Therefore,
it was submitted that the application for fixation of standard rent
will be very much maintainable under the provisions of the MRC
Act.
G
Public Premises Act vis-a-vis the Bombay Rent Act and the
MRC Act on the issue of eviction of unauthorised occupants
from Public Premises-
•
32. Before we deal with the· rival submissions on the
H maintainability of the standard rent application, we may note
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 585
[H.L. GOKHALE, J.]

that with respect to the aspect of eviction ofunauthorised A
occupants from the public premises, it is now well settled that
the Public Premises Act will· apply and not the Bombay Rent
Act or the subsequent MRC Act.

(i) In Kaiser-I-Hind Pvt. Ltd. & Anr. vs. National Textile B
Corpn. (Maharashtra North) Ltd. & Ors. [2002 (8) SCC 182)
one of the questions before the Constitution Bench was whether
the provisions of Bombay Rent Act having been re-enacted ·
after 1971 by the State Legislature with the assent of the
President will prevail over the provisions of the Public Premises · C
Act by virtue of Article 254 (2) of the Constitution. The court
noted that although the Public Premises Act received the assent..
of President on 23.8.1971, in view of Section 1 (3) of.Public ·.·
Premises Act, it is deemed to have come into force from
16.9.1958. On the other hand, the duration of Bomb~y Rent Act
was extended by Maharashtra Act No. 12 of 1970. Therefore, D
the Court held specifically in para 40 of its judgment that Article
254 (1) was the relevant one in the present case, and to the
extent of repugnancy, the State law will not prevail under Article
254 (1 ), and the law made by the Parliament shall. hold good.
E
(ii) Between the Public Premises Act and the MRC Act this
Court held in Crawford Bayley & Co. & Ors. v. Union of India
& Ors. [2006 (6) SCC 25] that to the eXtent specific provisions
were made in the Public Premises Act for eviction of
unauthorized occupants, that.Act will apply with respect to the F
Premises of the State Bank of India which were in dispute in·
that matter and not the MRC Act. ·

Other submissions on behalf of the appellant -

33. The learned senior counsel for the appellant Mr. G
Hansaria relied upon quite a few judgments in support of his
submission that the Standard Rent Application in the present
·case was very much maintainable under the MRC Act. We will
refer to some of them which lay down .the principles relevant
for our purpose, In Mis Jain Ink Manufacturing Company Vs.
H
586 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A Life Insurance Corporation of India and Another which is a
judgment of 3 Judges reported in [1980 (4) sec 435], the
provisions of the Public Premises Act were considered in the
light of those of Delhi Rent Control Act 1958, and the Slum
Areas (Improvement) and Clearance Act 1956. In that matter
B L.l.C had purchased the premises in question in which the
appellant was a tenant inducted by the original owner of the
premises. L.l.C had initiated the proceedings for the eviction
of the tenant before the estate officer. The appellant had
challenged the applicability of the Public Premises Act. This
c Court rejected that objection. The observations of this Court in
paragraph 8 and 9 are relevant for our purpose which read as
follows:-

8 ....... So far as the Premises Act is concerned it
operates in a very limited field in that it applies only to a
D limited nature of premises belonging only to particular sets
of individuals, a particular set of juristic persons like
companies, corporations or the Central Government. Thus,
the Premises Act has a very limited application. Secondly,
the object of the Premises Act is to provide for eviction of
E unauthorised occupants from public premises by a
summary procedure so that the premises may be available
to the authorities mentioned in the Premises Act which
constitute a class by themselves ....... .

F 9. Thus, it would appear that both the scope and the
object of the Premises Act is quite different from that of
the Rent Act. The Rent Act is of much wider application
than the Premises Act inasmuch as it applies to all private
premises which do not fall within the limited exceptions
indicated in Section 2 of the Premises Act. The object of
G
the Rent Act is to afford special protection to all the tenants
or private landlords or landlords who are neither a
corporation nor government or corporate bodies. It would
be seen that even under the Rent Act, by virtue of an
amendment a special category has been carved out under
H
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 587
[H.L. GOKHALE, J.]
Section 25-8 which provides for special procedure for A
eviction to landlords who require premises for their
personal necessity. Thus, Section 25-8 itself becomes a
special law within the Rent Act. On a parity of reasoning,
therefore, there can be no doubt that the Premises Act as
compared to the Rent Act, which has a very broad B
spectrum, is a special Act and overrides the provisions of
the Rent Act."

(emphasis supplied)
As is seen from this quotation, just as there is a special C
category carved out under the Rent Control Act in favour of the
landlord who requires premises for his personal necessity,
somewhat a similar provision is made under the Public
Premises Act. The reasonable and bonafide requirement of the
landlord to occupy the premises has been made a separate · D
permissible ground for recovery of possession under section
16 (1) (g) of the MRC Act. This section 16 (1) (g) is similar to
section 25 8 referred into the above judgment, and it reads as
follows:~

"16. When landlord may recovery possession E

(1) Notwithstanding anything contained in this Act but
subject to the provisions of section 25, a landlord shall be
entitled to recover possession of any premises if the court
is satisfied - F
(a) ........... ..

(b) ............ .

(c) ........... .. G
(d) ........... ..

(e) ............ .

(f) ............ .
H
588 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A (g) that the premises are reasonably and bona fide
required by the landlord for occupation by himself or by any
person for whose benefit the premises are held or where
the landlord is a trustee of a public charitable trust that the
premises are required for occupation for the purposes of
B the trust; or"

The Public Premises Act creates a forum for eviction of
the unauthorised occupants and provides for a special
procedure for recovery of the premises from such occupants.
Unauthorised occupation has been defined in a vide manner
C and it includes the continuation in occupation of any person of
the public premises after his authority to occupy has expired
or has been determined for any reason whatsoever. It would
as well include the determination of the authority to occupy
whenever the premises are required bonafide and reasonably
D by the public authority. There was no such special procedure
for the public bodies until the Public Premises Act was enacted.
When it comes to the requirement of the Government or the
Public Corporation, now the public body will be taking steps
under the Public Premises Act. It is, however, relevant to note
E as held in this judgment that the Public Premises Act has a very
limited application as against the Rent Act which affords a
special protection to the tenants by fixing standarq rent and
requiring the landlord to maintain the essential services. It was,
therefore, submitted that the standard rent application under the
F Rent Act would remain available to the tenant even if the
premises are otherwise covered under the Public Premises Act
for the purposes of eviction and recovery of arrears of rent from
the unauthorised occupants.

G The question of Repugnancy •

34. The question is as to whether the provision for fixation
of standard rent and the provision requiring landlord to maintain
the essential services under the MRC Act, which is a
subsequent Act passed by the State Legislature are in any way
H repugnant to the Public Premises Act which is an earlier Act
BANATWALA & COM~ANY v. L.l.C. OF INDIA & ANR. 589
[H.L. GO~HALE, J.]

passed by the Parliament. The distribution of legislative powers A
between the Union of India and the States has been provided
in the Seventh Schedule of the Constitution. It consists of List
I which is the Union List, List II which is the State List and List
Ill which is the Concurrent List. The question of repugnancy can
arise only in connection with the subjects which are enumerated B
in the Concurrent List with respect to which both the Union and
the State Legislatures have the concurrent power to legislate,
and when the State Legislature makes a law on a subject on
which the Parliament has already made a law. It is to deal which
such a conflict that Article 254 has been enacted~ Article 254 c
· of the Constitution deals with the question of inconsistency
between the laws made by the Parliament and laws made by
the Legislatures of States. This Article reads as follows:-

• 254. Inconsistency between laws made by Parliament
and laws made by the Legislatures of States - D

(1) If any provision of a law made by the Legislature of a
State is· repugnant to any 'provision of a law made by
Parliament which Parliament is competent to enact, or to
any provision of an existing law with respect to one of the E
matters enumerated in the Concurrent List, then, subject
to the provisions of clause (2), the law made by
Parliament, whether passed before or after the law made
by the ,Legislature of such State, or, as the case may be,
the existing law, shall prevail and the law made by the F
Legisrature of the State shall, to the extent of the
. repugnancy, be void ..

(2) Where a law made by the Legislature of a State with
respect to one of the matters enumerated in the
Concurrent List contains any provision repugnant to the G
provisions of an earlier law made by Parliament or an
existing law with respect to that matter, then, the law so
· made by the Legislature of such State shall, if it has been
reserved for the consideration of the President and has
received his assent, prevail in that State: H
590 SUPREME COURT REPORTS [2011] 14 {ADDL.) S.C.R.

A Provided that nothing in this clause shall prevent
Parliament from enacting at any time any law with respect
to the same matter including a law adding to, amending,
varying or repealing the law so made by the Legislature
of the State."
B
35. The question of repugnancy between the law made by
the Parliament and the law made by the State Legislature may
arise in cases when both the legislation occupy the same field
with respect to one of the matters enumerated in List Ill and
C where a direct conflict is seen between the two. The Principles
laid down by a bench of 3 Judges in Hoechst Pharmaceuticals
Ltd. Vs. State of Bihar reported in [1983 (4) sec 45] were
reiterated by a Constitution Bench in State of West Bengal Vs.
Kesoram Industries Ltd. And Ors. reported in [2004 (10) SCC
201]. Para 31 (5) thereof is instructive for our purpose and it
D reads as follows:-

"31. (5) Where the legislative competence of the
legislature of any State is questioned on the ground that it
encroaches upon the legislative competence of Parliament
E to enact a law, the question one has to ask is whether the
legislation relates to any of the entries in List I or Ill. If it
does, .no further question need be asked and Parliament's
legislative competence must be upheld. Where there are
three lists containing a large number of entries, there is
F bound to be some overlapping among them. In such a
situation the doctrine of pith and substance has to be
applied to determine as to which entry does a given piece
of legislation relate. Once it is so determined, any
incidental trenching on the field reserved to the other
legislature is of no consequence. The court has to look at
G
the substance of the matter. The doctrine of pith and
substance is sometimes expressed in terms of
ascertaining .the true character of legislation. The name
given by the legislature to the legislation is immaterial.
Regard must be had to the enactment as a whole, to its
H
' '
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 591
[H.L. GOKHALE, J.]
main objects and to the scope and effect of its provisions. A.
Incidental and superficial encroachments are to be
disregarded."

36. The question therefore to be examined is as to whether
the two legislations occupy the same field. If they do not, then
there is no repugnancy. Unless the provisions are irreconcilable, B
there will be a presumption in favour of the constitutionality. In
Ch. Tika Ramji and Ors. etc. v. The State of Uttar Pradesh
and Ors. [Al R 1956 SC 676], the question before the
·Constitution Bench was as to whether the UP Sugarcane
(Regulation of Supply and Purchase) Act, 1953 was repugnant C
to the Industries (Development and Regulation) Act of 1951
, which was a Central Act. The Apex Court noted that Section
18G of the Central Act deals with finished products and not raw
materials. This section did not cover the field of sugarcane
which was covered under the UP Act. The Court held that there D
was no repugnancy between the two legislations, since one
deals with the finished products wheceas the other deals with
raw materials.

37. In the case of M. Karunanidhi vs. Union of India & Anr. E
[1979 (3) sec 431] a Constitution Bench was concerned with
the question as to whether certain provisions of the Tamil Nadu
Public Men (Criminal Misconduct) Act 1973, were repugnant
to the provisions of Prevention of Corruption Act 1947 and the
Criminal Law Amendment Act 1952. The appellant was being F
prosecuted under sections 161, 468 and 471 of Indian Penal
Code and section 5 (2) read with section 5 (1) (d) of the
Prevention of Corruption Act 1947. The Court referred to earlier
decisions including the one in Deep Chand Vs. State of UP.
[AIR 1959 SC 648] wherein it was held that the repugnancy
between the two statutes may be ascertained by considering G
whether the Parliament intended to lay down an exhaustive
code in respect of the subject. matter considered in the State
Act replacing the Act of the State Legislature. The Constitution
Bench th'en laid down the principles governing the rule of
repugnancy in paragraph 35 which are as follows:- H
, '
· 592 SUPREME COURT REPORTS {2011] 14 {ADDL.) S.C.R

A 35. On a careful consideration, therefore, of the authorities
referred to above, the following propositions emerge:
1: That in order to decide the question of repugnancy it
must be shown that the two enactments contain
·inconsistent and irreconcilable provisions, so that they
8 cannot stand together or operate in the same field.

2. That there can be no repeal by implication unless the
inconsistency appears on the face of the two statutes.

3. That where the two statutes occupy a particular field, but
c there is room or possibility of both the statutes operating
in the same field without coming into collision with each
other, no repugnancy results.

4. That where there is no inconsistency but a statute
D occupying the same field seeks to create distinct and
separate offences, no question of repugnancy arises and
both the statutes continue to operate in the same field.
Consequently the Court held that there was no conflict
E amongst the legislations concerned.
38. The question with respect to conflict between two such
legislations came up before a Bench of three Judges in the
case of Vijay Kumar Sharma and Ors. Vs. State of Kamataka
and Ors. reported in [1990(2) SCC 562], where the question
F was whether there was any conflict between the Karnataka
Contract Carriages (Acquisition) Act 1976 and Motor Vehicles
Act, 1988. This Court looked into the judgments holding the field
and .held that there was no conflict between the two. It laid down
the law in paragraph 53 as follows:-
G "53. The aforesaid review of the authorities makes
it clear that whenever repugnancy between the State and
Central legislation is alleged, what has to be first examined
is whether the two legislations cover or relate to the same
subject matter. The test for determining the same is the
H ,
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 593
[H.L. GOKHALE, J.]
usual one, namely, to find out the dominant intention of the A
two legislations. If the dominant intention, i.e. the pith and
substance of the two legislations is different, they cover
different subject matters. If the subject matters covered by
the legislations are thus different, then merely because the
two legislations refer to some allied or cognate subjects 8
they do not cover the same field. The legislation, to be on
the same subject matter must further cover th"e entire field
covered by the other. A provision in one legislation to give
effect to its dominant purpose may incidentally be on the
same subject as covered by the provision of the other
legislation. But such partial coverage of the same area in C ·
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 to attract the article."
D
In the event of two Acts governing a common field,
whether both can apply for different purposes-

39. There could be provisions for certain purposes in one
statute, and for another purpose in another statute, though both E
govern the common field. Thus, in Krishna Distt. Coop. Mktg.
Society Ltd. Vijayawada vs. N. V. Purnachandra Rao & Ors.
[1987 (4) sec 99), the issue was, with respect to the application
of section 25-F of Industrial Disputes Act, to the employees who
were otherwise governed under the A.P. Shops and
Establishments Act, 1966. In that context this Court had to F
examine whether there was any conflict between the two Acts
and particularly when the AP. Act was a later act and it had
received the assent of the President The question was whether
compliance with Section 25-F of the Industrial Disputes Act
could be insisted for establishments governed under the Shops G
and. Establishments Act. This Court held that those provisions
will be applicable and there was no conflict between the
provisions of the two Acts. Section· 25-F of the Central Act
provided for the conditions precedent for retrenchment, and the
non-compliance therewith made the order of retrenchment fatal. H
594 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A Section 41 (1) and (3) of the A.P. Act provided for the
authorities to settle the disputes arising out of retrenchment.
Section 25 J (2) of the 1.0. Act reads as follows:-

"25-J.Effect of laws inconsistent with this chapter.-(1 ) ...... .

B (2) For the removal of doubts, it is hereby declared
that nothing contained in this chapter shall be deemed to
affect the provisions of any other law for the time being in
force in any State insofar as that law provides for the
settlement of industrial disputes, but the rights and liabilities
c of employers and workmen insofar as they relate to lay off
and retrenchment shall be determined in accordance with
the provisions of this chapter."

The court noted in para 8 that "the State Act does not
contain any express provision making the provision relating to
D retrenchment in the Central Act ineffective in so far as Andhra
Pradesh is concerned".· What is observed in para 6 is relevant
for our purpose:-

"6 ....... Sub-section (1) of Section 25-J of the Central Act
E lays down that Chapter V-A, shall have effect
notwithstanding anything inconsistent therewith contained
in any other law. The proviso to that sub-section however
saves any higher benefit available to a workman under any
law, agreement or settlement or award. Sub-section (2) of
Section 25-J however makes a distinction between any
F
machinery provided by any State law for settlement of
industrial disputes and the substantive rights and liabilities
arising under Chapter V-A of the Central Act where a lay
off or retrenchment takes place. It provides that while
Section 25-J would not affect the provisions in a State law
G
relating to settlement of industrial disputes, the rights and
liabilities of employers and workmen insofar as they relate
to lay off and retrenchment shall be determined in
accordance with Chapter V-A of the Central Act. It is thus
seen that Section 41(1) and Section 41(3) of the State Act
H
BANAlWALA & COMPANY v. L.l.C. OF INDIA & ANR. 595
[H.L. GOKHALE, J.]
prescribe alternative authorities to settle a dispute arising A
out of a retrenchment. Those authorities may exercise their
jurisdiction under the State Act but they have to decide
such dispute in accordance with the provisions of Chapter
V-A ............. "

40. Similarly, in the case of National Engineering B
Industries Ltd. vs. Shri Kishan Bhageria & Ors. [1988 Supp.
SCC 82], the question was whether a Reference under Section
10 of the Industrial Disputes Act, 1947 could be sought by the
employees covered under. the Rajasthan Shops and,
Establishments Act, 1958. This Court held that it would be so. C
In a similar way in Bharat Hydro Power Corpn. Ltd. & Ors. v.
State of Assam & Anr. (2004 (2) SCC 553], this Court held in
the context of Electricity Act 1910, and Assam Act No. 1 of
1997 that if two legislations operate in different fields without
' encroaching upon each other fields there cannot be any D
repugnancy.

41. In the field of criminal law also the same approach has
been adopted by this Court. In State of Maharashtra v. Bharat ·
Shanti Lal Shah and Ors. [2008 (13) SCC 5], the question was
with respect to the conflict between the Maharashtra Control of E
Organized Crime Act, 1999 (MCOC Act for short) and
Telegraph Act, 1885. In Zameer Ahmed Latifur Rehman
Sheikh vs. State of Maharashtra & Ors. [2010 (5) SCC 246],
the question was with respect to the conflict between the
MCOC Act and Unlawful Activities (Prevention Act), 1967. In F
both matters this Court took the view that mere difference in
the two Acts is not sufficient, and an incidental encroachment
is irrelevant. This Court held that there was no conflict in both
the cases.
G
Fixation of Standard Rent in the context of exemptions
from the Rent Control Laws - The question of remedy
42. Whatever be the object of granting exemption, where
the object is to see.that the properties of the State or semi-
state bodies should not suffer by the rigours of the Rent Control H
.. . -....
596 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A Laws or the possession of the public premises be recovered
expeditiously, "the Courts have expressed their views that these
authorities being public bodies should so behave as not to act
contrary to the policies laid down in the Rent Control Laws
namely not to increase the rent unreasonably or excessively,
B nor to evict their tenant unreasonably or arbitrarily, save and
except in public interest." (J.H. Dalal in his Commentary on the
Bombay Rent Act, Fifth Edition, Page 65).
43. In this context one of the earliest cases coming before
the Bombay High court was Rampratap Jaidayal Vs. Dominion
C of India reported in [AIR 1953 Born 170]. Central Government
had served upon the appellant tenant a notice to quit and the
suit for ejectment was decreed. In the first appeal filed by the
defendant tenant the question arose with respect to the nature ·
of exemption available to the Government under section 4 (1)
D of the Bombay Rent Act. The appeal filed was dismissed by
the Division Bench consisting of Chagla C.J and
Gajendragadkar, J (as he then was in the Bombay High Court).
What was observed by Chagla C.J. in the judgment with respect
to the rent to be charged by the public bodies is relevant for
E our purpose. Amongst other arguments the exemption granted
to the State was challenged as amounting to unreasonable
classification hit by Article 14 of the Constitution. The Division
Bench repelled the argument by relying upon the judgment of
a constitution bench of this Court in State of Bombay Vs. F.N.
F Ba/sara reported in (1951 SCR 682] equivalent to (53 Born.
LR 982 (SC}], wherein Fazl Ali, J had drawn seven principles
on the meaning and scope of Article 14 of the Constitution from
the earlier judgment of this Court in 'Chiranjitlal v. Union of
India' reported in [AIR 1951 SC 41), and relied upon the very
G first principle therefrom and observed as follows:-
"8 ..... perhaps attention might be drawn to the very
first where the Supreme Court emphasizes the fact that the
presumption is always in favour of the constitutionality of
an enactment and this presumption arises from the fact
H
BANATWALA & COMPANY v. L.1.C. OF INDIA & ANR. 597
[H.L. GOKHALE, J.]
that the Legislature understands and correctly appreciates A
the needs of its own people and that its laws are directed
to problems made manifest by experience and therefore
it must always be presumed that discriminations are
based on adequate grounds ...... "

Thereafter what the Court observed at the end of this para B
8 is relevant for our purpose:-

" ...... it is clear that in this case the Legislature was
not in any sense exempting the Government from the
operation of the Act in order to permit the Government to C
do the very thing which the Legislature was prohibiting in
the case of landlords who were not a local authority or
Central or State Government. It is not too much to assume,
as the Legislature did in this case assume, that the very
Government whose object was to protect the tenants and
prevent rent being increased and prevent people being D
ejected, would not itself when it was the landlord do those
very things which it sought to prohibit its people from doing,
and therefore the underlying assumption of this exemption
is that Government would not increase rents and would not
eject tenants unless it was absolutely necessary in public E
interest and unless a particular building was required for
a public purpose."

44. In another case Baburao Shantaram More Vs. The
Bombay Housing Board reported in [AIR 1954 SC 153] which F
came up before a Constitution Bench of this Court, the question
was with respect to the eviction of a tenant of the then Bombay
Housing Board, constituted under the Bombay Housing Board
Act, 1948. A decree for eviction had been passed against the
tenant which had been upheld by the High Court. The appeal G
therefrom was dismissed by this Court. While upholding the
exemption of the Bombay Housing Board under section 4 of
the Bombay Rent Act, the Court held that the classification was
based on an intelligible differentia, and held that the tenant or
the local authority or the board were not in need of such H
SUPREME COURT REPORTS (2011] 14 (ADDL.) S.C.R.
598

A protection as the tenants of private landlords. This was for the
reason as stated by S.R. Das J (as he then was) for the Court:-

"6 ..... It is not to be expected that the Government
or Local authority or the Board would be actuated by any
profit making motive so as to unduly enhance the rents or
B eject the tenants from their respective properties as private
landlords are or are likely to be .... ."

45. In Mis Dwarkadas Marfatia V. Bombay Port Trust
reported in [1989 (3) SCC 293), the trustees of Bombay Port
C had evicted the appellant from a plot of land and allotted it to
another tenant, and obtained the decree of eviction. While
upholding the decree, this Court examined the question of
exemption of a local authority under section 4 of the Bombay
Rent Act. In paragraph 14 and 15 of its judgment a Bench of 3
D Judges quoted with approval the above referred quotation of
Chagla C.J. and S.R. Das, J, and thereafter observed as
follows in para 17:-

"17. It, therefore, follows that the public authorities which
enjoy this benefit without being hidebound by the
· E requirements of the Rent Act must act for public benefit.
Hence, to that extent, this is liable to be gone into and can
be the subject matter of adjudication."

(emphasis supplied)

F What this Court observed further per Sabyasachi Mukharji,
J. (as he than was) in paragraph 24 is relevant for our purpose:-

"24. The field of letting and eviction of tenants is
normally governed by the Rent Act. The Port Trust is
statutorily exempted from the operation of the Rent Act on
G
the basis of its public/governmental character. The
legislative assumption or expectation as noted in the
observations of Chagla, C.J. in Rampratap Jaidayal case
cannot make such conduct a matter of contract pure and
simple. These corporations must act in accordance with
H
.,

BANATWALA & COMPANY v. Ll.C. OF INDIA & ANR. 599
[H.L GOKHALE, J.]
certain constitutional conscience and whether they have so A .
acted, must be discernible from the conduct of such
corporations ..... "

(emphasis supplied)

Thereafter, in para 27 the Court further observed in the 8
following words:-

"27. We are inclined to accept the submission that every
activity of a public authority especially in the background
of the assumption on which such authority enjoys immunity C
from the rigours of the Rent Act, must be informed by
reason and guided by the public interest. Alf exercise of
discretion or power by public authorities as the
respondent, in respect of dealing with tenants in respect
of which they have been treated separately and distinctly
from other landlords on the assumption that they would D
not act as private landlords, must be judged by that
standard. If a governmental policy or action even in
contractual matters fails to satisfy the test of
reasonableness, it would be unconstitutional. See the
observations of this Court in Kasturi Lal Lakshmi Reddy E
and R.D. Shetty v. International Airport Authority of India
(SCC pp. 505-06 : SCR p. 1034)."

(emphasis supplied)

Yardstick for Standard Rent:- F

46. Relying upon the above judgments Mr. Hansaria
submitted that the Public authorities cannot raise rent arbitrarily.
In this behalf he referred to the guidelines framed by the Central
Government to prevent arbitrary use of the power under this Act. G
These guidelines are issued by the Central Government under
resolution dated 30.5.2002 and published in the Government
of India Gazette dated 8.6.2002. Guidelines No. 2 (1) and 2
(3) are relevant for our purposes. He relied upon the judgment
H
600 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A of a Division Bench of Bombay High Court in Persis
Kothawala vs. UC reported in 2004 (4) BCR 610 to submit
that these guidelines are expected to be followed. We quote
these guidelines which are as follows:-

" MINISTRY OF URBAN DEVELOPMENT AND
B POVERTY ALLEVIATION

(DIRECTORATE OF ESTATES)

RESOLUTION

c New Delhi, the 30th May 2002

Subject: Guidelines to prevent arbitrary use of powers to
evict genuine tenants from public premises under the
control of Public Sector Undertakings/financial institutions.
D No.21013/1/2000-Pol.I - The question of notification
of guidelines to prevent arbitrary use of powers to evict
genuine tenants from public premises under the control of
Public Sector Undertakings/financial institutions has been
under consideration of the Government for some time
E past.

2. To prevent arbitrary use of powers to evict genuine
tenants from public premises and to limit the use of
powers by the Estate Officers appointed under Section 3
of the P.P.(E) Act, 1971, it has been decided by
F
Government to lay down the following guidelines:-

(i) The provisions of the Public Premises (Eviction
of Unauthorised Occupants) Act, 1971 [P.P. (E) Act, 1971]
should be used primarily to evict totally unauthorised
G occupants of the premises of public authorities or
subletees, or employees who have ceased to be in their
service and thus ineligible for occupation of the premises.

(ii) The provisions of the P.P.(E) Act, 1971 should
H
BANATWALA & COMPANY v. L.l.C'. OF INDIA & ANR: 601
[H.L. GOKHALE, J.]

not be resorted to either with a commercial motive or to A
secure vacant possession of the premises in order to
accommodate their own employees, where the premises
were in occupation of the original tenants to whom the
premises were let either by the public authorities or the
persons from whom the premises were acquired. B

(iii) A person in occupation of any premises should
not be treated or declared to be an unauthorised occupant
merely on service of notice of termination of tenancy, but
the fad of unauthorised occupation, shall be decided by
following the due procedure of law. Further, the contractual C
agreement shall not be wound up by taking advantage of
the provisions of the P.P. (E) Act, 1971. At the same time,
it will be open to the public authority to secure periodic
revision of rent in terms of the provisions of the Rent Control
Act in each State or to move under genuine grounds under D
the Rent Control Act for resuming possession. In other
words, the public authorities would have rights similar to
private landlords under the Rent Control Act in dealing with
genuine legal tenants.
E
(iv) It is necessary to give no room for allegations that
evictions were selectively resorted to for the purpose of
securing and unwarranted increase in rent, or that a
change in tenancy was permitted in order to benefit
particular individuals or institutions. In order to avoid such F
imputations or abuse of discretionary powers, the release
of premises or change of tenancy ~hould be decided at
the level of Board of Directors of Public Sector
Undertakings.

(v) All the Public Undertakings should immediately G
review all pending cases before the Estate Officer or
Courts with reference to these guidelines, and withdraw
eviction proceedings against genuine tenants on ground
otherwise than as provided under these guidelines. The
provisions under the P.P: (E) Act, 1971 should be used H
602 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A henceforth only in accordance with these guidelines.

3. These orders take immediate effect.

VINEETA RAI

8 Additional Secy."

47. Mr. Hansaria pointed that when the MRC Act was
being framed, LIC specifically represented to Maharashtra
State Law Commission that it be exempted from the coverage
of the proposed law. This is recorded in Twelth Report of July
C 1979 of the State Law Commission which finds a reference in
paragraph 33 of the Bombay High Court judgment in Minoa
Framroze Balsara Vs. The Union of India & ors. [AIR 1992
Born 375). However, that representation of L.l.C was not
accepted~ Lateron in view qf the. amendment of section 2 (e)
D of the Public Premises Act, L.l.C came to be covered under
the Public Premises Act, but was not exempted from the MRC
Act.

48. Lastly, Mr. Hansaria relied upon the judgment of a
E Division Bench of Karnataka High Court in the case of Bharath
Gold Mines Ltd vs. Kannappa [ILR 1988 KAR 3092) equivalent
to 1989 (2) All India Rent Control Journal 154, where the
Division Bench has held that the power to evict does not include
the power to fix rent. Fixation of rent was independent from
eviction, and it was not dealt with under the Public Premises
F Act. The Public Premises Act does not override the provisions
of the Karnataka Rent Control Act, 1961 regarding the fixation
of fair rent. It is submitted that the same approach ought to be
adopted in the present case.

G Reply on behalf of L.l.C -

49. The learned Additional Solicitor General Mr. Rawal
appearing for the respondents submitted that the appellant had
agreed to 35% rise in the rent every five years. Section 7 of
the Public Premises Act provides for payment of rent by the
H
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 603
[H.L. GOKHALE, J.]
authorized tenant, and makes a provision for damages for the A
unauthorized occupation. A hearing is provided for recovery of
the arrears of rent and the damages under that section, and
the order, if any, passed against the occupant is appealable
under Section 9 of the Act. The order is given finality under
Section 10 of the Ad. He pointed out that as noted by this Court 8
also in Shangrila Food Products Ltd. and Another Vs. L./.C.
and Another reported in [1996 (5) SCC 54], that "unless the
occupant is first adjudged as an unauthorized occupant, his
liability to pay damages does not' arise. In other words, if he is
an authorized occupant, he may be required to pay rent but not
damal1es. The quality of occupation and the quality of C
recompense for the use and occupation of the public premises
go hand in hand and are interdependent".

50. The rent was being fixed on one of the three yardsticks,
i.e. (i) as per the document of lease, (ii) as per the contract D
between the parties, or (iii) as per the grant. If the arrears of
rent remained to be recovered from the tenant, there is a power
to recover the same even from the heirs and legal
representatives under Section 13 of the Act, and if the rent or
damages are not paid, they can be recovered as arrears of E
land revenue under Section 14 and an unlawful occupant can
be prosecuted under Section 11 of the Act. This being the
position the idea of standard rent was foreign to the Public
Premises Act. ,

51. A reference was made to the rules which are framed· F ·
under the Act alongwith the relevant forms framed thereunder.
Thus, Form D contains the format for the notice under Section
7 (3) read with Sub-section (1) thereof which is to be issued
by the Estate Officer for calling the tenant for an enquiry into
the arrears of rent. Form F is the format of the notice for enquiry · G · .
for determining the damages for unauthorized occupation to be . ·
assessed under Section 7 (3) read with Sub-section (2) thereof.
It was, therefo.re, submitted that necessary mechanism is ·
provided under the Act and the Rules.
H
604 SUPREME COURT REPORTS (2011] 14 (ADDL.) S.C.R.

A 52. Thereafter it was pointed out that all that the
respondents had done was to pass on the amount of property
tax demanded by the Municipal Corporation to the appellant. It
WClS submitted that when the respondent received a notice
dated 23.3.2006 from the Municipal Corporation of Mumbai to
B ~ance the property tax, to begin with the respondent objected
to the revision by their reply dated 13.4.2006. The officers of
the respondent attended the proceedings in the municipal office
whereafter the Municipal Corporation reduced their demand by
10%. It is only a proportion of this amount which was passed
c on to the appellant and which is sought to be recovered and
they should not make any grievances about the same. .

53. The respondents then relied upon the judgment of a
Division Bench of Bombay High Court in Minoo Framroze
Balsara (supra). In that matter the challenge to the validity of
D the Public Premises Act by invoking Article 14 was repelled
by the High Court. It is however, material to note that this
judgment was essentially concerning eviction of unauthorized
occupants and did not deal with the aspect of fixation of
standard rent.
E
54. Mr. Rawal then referred to us two judgments of this
Court. Firstly, he referred to para 10 of Jain Ink Mfg. Co. vs.
L/C (supra), wherein this Court had held that once the Public
Premises Act. applies, the Delhi Rent Control Act will stand
superseded. He then referred to Prithipal Singh v. Satpal
F Singh {dead) thr. its Lrs. [2010 (2) SCC 15] where in para 29
this court has held that the Delhi Rent Control Act and the
Maharashtra Act are pari-materia, and therefore, on that footing
he submitted that by applying the judgment in Jain Ink Mfg. Co.
(supra), Maharashtra Act also gets eclipsed by the Public
G Premises Act. We have already referred to the judgment in Jain
Ink Mfg. Co. (supra). The judgment was in the context of eviction
from Public Premises and not concerning fixation of standard
rent, and therefore, the observations in para 10 thereof will have
to be looked into from that point of view.
H
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 605
[H.L. GOKHALE, J.]
55. The submission of Mr. Rawal was that an exclusionary A
clause has to be read strictly. In the present case Section 2 (f)
·read with Section 15 (d) of the Act dealt with the definition of
rent and exclusion of proceedings for recove!)' of rent by way
of Civil suit, and there was no non-obstante clause in the MRC
Act. In this context, he relied upon a judgment of this Court in B
Church of North India Vs. Lavajibhai Ratanjibhai reported in
[2005 (10) SCC 760]. In that matter, after examining the
scheme of Bombay Public Trusts Act, 1950 and relying upon
the dicta of the constitution bench in Dhulabhai Vs. State of
M.P. reported [AIR 1969 SC 78], this Court had held that a suit C
for declaration as to the succession to a public trust was not
maintainable, since the authorities under the Bombay Public
Trusts Act had exclusive jurisdiction. A similar approach was
suggested in the present case.

56. It was then submitted that the MRC Act excludes some D
tenants from the protection of the rent Act such as the Banks,
Insurance Companies and Multi National Companies being rich
tenants. In the same way, under the Public Premises Act, fixing
of standard rent has been excluded, and that should be held to
be permissible. If a tenant is aggrieved by the rent fixed, his E
remedy will be to invoke Article 226 of the Constitution, but one
cannot permit part of the proceedings regarding arrears of rent
before the Court of the Estate Officer, and another part
concerning fixation of standard rent before the Rent Controller.

57. With respect to the guidelines framed by the Central F
Government, it was submitted by Mr. Rawal that non-statutory
guidelines are to be treated as advisory in character and
present guidelines need not be read as conferring any legal
rights on the tenants. He relied upon paragraph 23 of the
judgment of a Bench of two Judges of this court in New India · G
Assurance Co. Ltd. Vs. Nus/i Neville Wadia reported in [2008
(3) sec 279] in this behalf.

Consideration of rival submissions
The issue with respect to maintainability of the Standard H
606 SUPREME COURT REPORTS (2011] 14 (ADDL.) S.C.R.

A Rent Application and the question of conflict with the
provisions of the Public Premises Act-

58. As we have noted earlier, the question for our
considerations is whether the application of the appellant for
fixation of standard rent was maintainable under the MRC Act,
8 notwithstanding the fact that the premises of the appellant were
otherwise covered under the Public Premises Act for the
purposes of that Act. Again, as we have noted earlier, the
appellants do not dispute that for the purposes of eviction of
unauthorised occupants, and for the recovery of arrears of rent
C from them, the proceedings to be initiated by the respondents
would be fully competent under the Public Premises Act, and
that in such an eventuality the occupants will not be entitled to
seek any remedy under the MRC Act, since the jurisdiction of
the Civil Court has been ousted under Section 15 of the Public
D Premises Act in this behalf. It is also already held by this Court
in the cases of Kaiser-I-Hind and Crawford Bayley (supra) that
as far as the issue of eviction of unauthorised occupants from
Public Premises is concerned, the authorities under the Public
Premises Act alone will have jurisdiction to deal therewith, and
E no proceedings will lie either under the Bombay Rent Act or
the MRC Act. The question in the present matter is with respect
to the maintainability of the Standard Rent Application by the
occupants of these premises under the MRC Act. Mr. Hansaria,
learned counsel for the appellants points out that this issue has
F not been decided by this Court so far.

59. Before we deal with the rival submissions, we may state
once again that under the general law of landlord and tenant
also, the landlord had the obligation to charge only the rent
agreed under the lease agreement, and to carry out the repairs
G to the property which were necessary, failing which the tenant
would be entitled to carry out the same and deduct the
expenses from the rent [see Section 108 (B) (f) of the Transfer
of Property Act]. As we have noted earlier, due to the problems
\
of the scarcity of accommodation following the Second World
H War, special protection was made available to the tenants
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 607
[H.L. GOKHALE, .J.]
against unjustified increases in rent and ejectrnent from the A
tenancies. This protection was reflected in the provisions of
various Rent Control Acts such as the Bombay Rent Act, 1947
which governed the premises of the appellant for
all purposes
prior to the coming into force of the Public Premises Act, 1971.
When the Public Premises Act was enforced, it covered the B
subject of eviction of unauthorised occupants' of the public
premises and recovery of arrears of rent from them, and those
subjects no longer remained covered under the Bombay Rent
Act. The question is whether the remedies for fixation of
Standard Rent and getting the essential services restored when
necessary, no longer remained available to the tenants like th~ C
appellant merely because the Public Premises Act came to be
applied·. And secondly, after the MRC Act came into force from
31st March, 2000 whether these remedies once again came
to be reinforced.
D
60. We have noted the observations from the leading
judgment of the Constitution Bench in Ashoka Marketing. In 'that
matter this Court was concerned with the question as to
whether the proceedings for eviction initiated under the Public
Premises Act were maintainable or whether they had to be E,
taken under the Delhi Rent Control Act, 1958. As we have noted
earlier this Court has held that since both the acts were
concerning entries no. 6, 7 and 13 of the Concurrent List, and
since the Public Premises Act was a subsequent Act, and
governing the particular subject, the same will override, and the
F
eviction proceedings thereunder were valid and competent. ·

61. The question in this case is different in the sense that
the MRC Act which is a State Act, is an Act subsequent to the
Public Premises Act, and has been assented by the President,
notwithstanding the existence of the Public Premises Act. The G
. situation, therefore, would be governed by Sub-article (2} of
Article 254 of the Constitution, and we will have to see whether
the provisions of MRC Act with respeCt to the fixing of the
standard rent and restoring the essential supplies and services
H
608 SUPREME COURT REPORTS (2011] 14 (ADDL.) S.C.R.

A are in any way repugnant to the Public Premises Act. In Vijay
Kumar Sharma Vs. State of Karnataka (supra) a Bench of
three Judges of this Court has laid down that whenever
repugnancy is alleged, what has to be first examined is whether
the two legislations cover or relate to the same subject matter.
B The test for that is to find out the dominant intention of the two
legislations. If the subject matters covered by the legislations
are different, merely because the two legislations refer to some
allied or cognate subjects they do not cover the same field.

62. We have noted the observations of a Bench of three
C Judges of this Court in Mis Jain Ink Mfg. Co. (supra) that the
Public Premises Act has a very limited application, whereas
the Rent Act is an Act with much wider application than the
Public Premises Act. In the present case, the subjects of
fixation of Standard Rent and restoration of essential services
D by the landlord are covered under the MRC Act, but in no way
under the Public Premises Act. The Public Premises Act, in fact
does not claim to cover these subjects. As held by the
Constitution Bench in Kesoram Industries Ltd. (supra), the
Court has to look at the substance of the matter. Regard must
E be had to the enactment as a whole, to its main objects and
scope of its provisions. Incidental and superficial
encroachments are to be disregarded. Eviction and recovery
of arrears of rent are alone covered under the Public Premises
Act. The subject of fixation of rent is different and independent
F from eviction as held by the division bench of the Karnataka
High in Bharath Gold Mines. That being the position, there is
no conflict between the MRC Act and the Public Premises Act
when it comes to the provisions in the MRC Act with respect
to fixation of Standard Rent and requiring the landlord to
G maintain the essential services and supplies. Therefore, the
provisions of MRC Act in that behalf cannot in any way be said
to be repugnant to those under the Public Premises Act. The
presumption is in favour of constitutionality, and the Court is not
expected to strike down a provision unless the conflict is a real
one. In the present matter there is no such real conflict.
H
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 609
[H.L. GOKHALE, J.]
On ouster of the jurisdiction of the Civil Courts- A
63. We may next deal with the contention of the
respondents that the exclusionary clauses are to be read strictly.
In the case of Church of North India (supra), relied upon by the
respondents, this Court was concerned with a suit for
declaration as to the succession to a particular trust governed B
under the ~pmbay Public Trust Act. Such a suit was squarely
covered under that Act and, therefore, it was held that the Civil
Court will nQt have the jurisdiction to entertain the suit. The seven
principles laid down by the Constitution Bench in Dhu/abhai Vs.
State of MP. (supra) were relied upon in that case. It is sufficient C
to refer to the first two principles therefrom which are as
follows:-

"(1) Where the statute gives a finality to the orders
of the special Tribunals the civil courts' jurisdiction must be
0
held to be excluded if there is adequate remedy to do what
the civil courts would normally do in a suit. Such provision,
however, does not exclude those cases where the
provisions of the particular Act have not been complied
with or the statutory Tribunal has not acted in conformity
with the· fundamental principles of judicial procedure. E

(2) Where there is an express bar of the jurisdiction
of the court, an examination of the scheme of the particular
Act to find the adequacy or the sufficiency of the remedies
provided may be relevant but is not decisive to sustain the F
jurisdiction of the civil court."

If we apply these two tests and examine the scheme of the
Public Premises Act, it will be seen that section 10 of the Act
8oes give a finality to the orders passed by the Estate Officers G
or the Appellate Officers, and states that 'the same shall not
be called in question in any original suit, application or
execution proceeding, and no injunction shall be granted by any
court or other authority in respect of any action taken or to be
taken in pursuance of any power conferred by or under this Act'.
H
610 SUPREME COURT REPORTS [2011j 14 (ADDL.) S.C.R.

A Section 15 of the Act specifically states that no court shall have
jurisdiction to entertain any suit or proceeding in respect of the
subjects, amongst others concerning, '(a) the eviction of any
person who is in unauthorised occupation of any public
premises, and (d) the arrears of rent payable under sub-section
(1) of section 7 or damages payable under sub-section (2), or
8
interest payable under sub-section .(2A), of that section'.
Therefore, to that extent the jurisdiction of the Civil Court is
ousted. The actions which are covered· under the Public
Premises Act are concerning eviction of unauthorised
occupants and recovery of arrears of rent. The Act however
C does not claim to speak anything about the fixation of Standard
Rent or maintenance of essential services. For these purposes
no remedy is provided under the Public Premises Act.
Therefore, the jurisdiction of the Civil Court for these remedies
cannot be held to be ousted.
D
64. It was submitted on behalf of the respondent that if the.
submission of the appellant is accepted it will mean permitting
proceedings before the Court of Estate Officer for recovery of
arrears of rent, and before the Rent Controller for fixation of
E standard rent, and the same is not desirable. In our view, this
by itself can be no reason to hold the Standard Rent Application
to be not maintainable before the Court of Small Causes. We
have referred to the judgment in the case of National
Engineering Industries Ltd. Vs. Shri Kishan Bhageria (supra).
F In that ease the establishment wherein the respondent/
workman was employed was covered under the Rajasthan
Shops and Establishment Act, 1958. It was also covered under
the Industrial Disputes Act, 1947. Dismissal of his application
for reinstatement under Section 28A of the Rajasthan Act on
the ground of limitation was held as not preventing a reference
G under Section 10 of the Industrial Disputes Act. The observation
of this Court at the end of para 12 of that judgment is relevant
for our purposes, and which reads as follows:-

"12 ......... It appears to us that it cannot be said that these
H two Acts do not tread the same field. Both these Acts deal
BANATWALA & COMPANY v. L.l.C. OF INDIA & ANR. 611
[H.L. GOKHALE, J.]
with the rights of the workman or employee to get redressal A ·.
and damages in case of dismissal or discharge, but there
is no repugnancy because there is no conflict between
these two Acts, in pith and substance. There is no
inconsistency between these two Acts. These two Acts, in
our opinion, are supplemental to each other."
8
65. Same is the position with respect to the Labour Laws
in various States. Thus, for example, where an industry is
covered under a State Act such as the Bombay Industrial
Relation Act, 1946 in Maharashtra, the workmen engaged
therein will be required to raise the disputes concerning C
reinstatement and backwages in the event of dismissal,
retrenchment, removal or termination before the authority under
that Act. At the same time, whenever any money, including
unpaid wages is due to the workmen, they also have the right
to file the claim applications under section 33 C (2) of the D
Industrial Disputes Act, 194 7, in the Labour Courts constituted
under that Act, since similar provision is not made under the
said Bombay Act. The MRC Act being a welfare statute like
the labour laws is enacted after considering the requirements
of the tenants, and contains the provisions for fixation of E
standard rent and for restoring essential services and supplies
when necessary. The public premises are not specifically
exempted from the applicability of the MRC Act. That being so,
there is no reason to hold that these remedies will not be
available to the tenants of the public premises, though for the F
purposes of eviction of unauthorised occupants and recovery
of arrears of rent, ~he proceedings will lie only under the Public
Premises Act. It is also to be noted that the proceedings for
the recovery of arrears of rent are at the instance of landlord,
whereas those for fixation of standard rent are at the instance
of the tenant. Both these proceedings are quite different in their G
prayers and scope of consideration. The fact that the
, proceeding for one purpose is provided under one statute can
- not lead to an automatic conclusion that the remedy for a

H
612 SUPREME COURT REPORTS [2011] 14 (ADDL.) S.C.R.

A different purpose provided under another competent statute
becomes unavailable.

Expectations from Public Bodies -

66. Although the question of maintainability of the Standard
B Rent Applications concerning the public premises is only
coming up now before this Court, we have referred to the views
of Courts when different facets of this issue came up for
consideration from time to time. The exemption from the
Bombay Rent Act to the government premises was upheld in
C Rampratap Jaidayal (supra), on the basis of the presumption
in favour of the constitutionality of the enactment which was also
on the footing that Legislature correctly appreciates the needs
of its own people. Chief Justice Chagla has clearly observed
in that matter that the Legislature was not in any sense
exempting the Government from the operation of the Act in order
0
to permit the Government to do the very thing which the
Legislature was prohibiting the landlords from doing, viz. not
to increase rents and not to eject tenants unless it was
absolutely necessary in the public interest. S.R. Das, J. (as he
then was) has also observed similarly in Baburao Shantaram
E More (supra) that it was not expected that the Government or
the Local Authority would be actuated by any profit making
motive so as to unduly enhance the rents or eject the tenants
from their respective properties as private landlords are or are
likely to be. Sabyasachi Mukharji, J (as he then was) has gone
F further in Dwarkadas Marfatia (supra), and observed that when
public authorities enjoy this benefit of being hidebound by the
requirements of the Rent Act, they must act for public benefit,
and to that extent this issue is liable to be gone into and can
be the subject-matter of adjudication. He has stated in no
G uncertain terms that the legislative expectations as observed
by the Chagla, C.J. in Rampratap Jaidayal (supra) cannot
make such conduct a matter of contract pure and simple. He
has further observed that the exercise of discretion of public ·
authorities must be tested on the assumption that they would
H not act as private landlords and they must be judged by that
BANATWALA & COMPANY v. L.1.C. OF INDIA & ANR. 613
[H.L. GOKHALE, J.]
standard. We may however, add that these principles will have A
no relevance while considering a dispute between a statutory
body as landlord and an affluent tenant in regard to a ·
commerical or non-residential premises.
On the relevance of the Guidelines -
B
67. In the instant case, the activities of the respondent/L.l.C
are controlled by the LIC Act. Section 21 of the LIC Act lays
down that the Corporation shall be guided by the directions
issued by the Central Government. This Section reads as
follows:- c
"21. Corporation to be guided by the directions of Central
Government-
In the discharge of its functions under this Act, the
Corporation shall be guided by such directions in matters D .
of policy involving public interest as the Central
Government may give to it in writing; and if any question
arises whether a direction relates to a matter of policy
involving public interest the decision of the Central
Government thereon shall be final." E
The guidelines dated 30.5.2002 are not directions under
section 21 of the UC Act.
68. We have referred to the guidelines laid ciown by the
Central Government in this behalf. Guidelines no. 2(i) and 2 (iii) F
are relevant for our purpose. Guideline no. 2 (i) states that the
provisions of the Public Premises Act, 1971 should be used
primarily to evict totally unauthorised occupants. Guideline No.
2 (iii) specifically states that it will be open to the public authority
to secure periodic revision of rent in terms of the provisions of G
the Rent Control Act in each State, or to move under genuihe
grounds under the Rent Control Act for resuming possession.
Thus, these guidelines specifically recognise the relevance of
certain provisions of Rent Control Acts for their application to
the properties covered under the Public Premises Act. It is H
614 SUPREME COURT REPORTS (2011] 14 (ADDL.) S.C.R.

A stated in the guidelines that the public authorities would have
rights similar to private landlords under the Rent Control Acts
in dealing with genuine legal tenants. It follows that the public
authorities will have the obligations of the private landlords also.
It is relevant to note that the purpose of these guidelines is to
preventarbitrary use of powers under the Public Premises Act.
8
The re.levance of the guidelines will depend upon the natureof
guidelines and the source of power to issue guidelines. The
source of the right to apply for determination of standard rent
is the Rent Control Act, and not the guidelines.
C 69. We may also note by subsequent clarificatory order
dated 23. 7.2003, the Central Government has made it clear that
the guidelines dated 30.5.2002 will not apply to affluent tenants:
"The Government resolution dated 30.5.2002 embodies
the guidelines dated 14.1.1992 for observance by the public
0
sector undertakings. However, clarification was issued vide OM
No. 21011/790 Pol-I IV H. 11 dated 7.7.1993 that the guidelines
are meant for genuine non-affluent tenants and these are not
applicable to the large buisiness housesand commerical
E entrepreneours."
70. It was submitted on behalf of the respondents that if
the appellant ~r the tenants are aggrieved by the fixation of the
rent, their remedy is to invoke the writ jurisdiction of the High
Court. In making this submission, the respondents are ignoring
F that the writ jurisdiction is a discretionary jurisdiction. Besides,
normally oral evidence is not recorded while exercising the writ
jurisdiction. Although part of the evidence to be examined in
the process of rent fixation would be documentary, such as the
provisions of the contract between the parties and those
G governing properties of the government, there would also be
many other factors which may require oral evidence, particularly
with respect to the comparable properties. An appropriate
remedy, forum and procedure are therefore necessary in the
interest of fairness and proper adjudication. That apart, there
H is no reason to insist upon such an interpretation which will
BANATWALA & COMPANY v. Ll.C. OF INDIA & ANR. 615
[H.L. GOKHALE, J.]
deny to the tenants of the public premises, a remedy and a A
forum which are otherwise available to the tenants under the
MRC Act,.

71. In view of what is stated above, the interpretation as
canvassed by the respondents will deny the appropriate remedy
to the petitioner and the like tenants, to have the rent of their B
premises being fixed by filing a Standard Rent Application, and
also to get the essential services restored in the event of any
difficulty. There is no reason to accept any such interpretation
because as stated above there is no conflict between this
provisions of the MRC Act with those under the Public C
Premises Act, when it comes to fixation of standard rent and
restoring the essential supplies. Otherwise it will expose the
provisions of Public Premises Act to the vires of
unreasonableness also. The interpretation canvassed by the
respondents is not in consonance with the welfare state that is D
contemplated under the Indian Constitution. Accordingly, we
hold that the impugned judgment of the learned Single Judge
of Bombay High Court does not lay down the correct position
in law. As against that we approve the approach and the
interpretation adopted by the Karnataka High Court in Bharath E
Gold Mines Ltd. (supra).

72. In the circumstances, we hold as follows:-

(a) The provisions of the Maharastra Rent Control Act,
1999 with respect to fixation of Standard Rent for premises, F
and requiring the landlord not to cut off or withhold essential
supply or service, and to restore the same when necessary, are
not in conflict with or repugnant to any of the provisions of the
Public Premises (Eviction of Unauthorised Occupants) Act,
1971. G
(b) The provisions of the Public Premises Act, 1971 shall
govern the relationship between .the public undertakings
covered under the Act and their occupants to the extent they
provide for eviction of unauthorised occupants from public
H
616 SUPREME COURT REPORTS [2011] 14 (ADDL) S.C.R.

A premises, recovery of arrears of rent or damages for such
unauthorised occupation, and other incidental matters specified
under the Act.

(c) The provisions of the Maharashtra Rent Control Act,
1999 shall govern the relationship between the public
B undertakings and their occupants to the extent this Act covers
the other aspects of the relationship between the landlord and
tenants, not covered under the Public Premises Act, 1971.

(d) The application of appellant and similar applications
c of the tenants for fixation of Standard Rent or for restoration of
essential supplies and services when necessary, shall be
maintainable under the Maharashtra Rent Control Act, 1999.

73. Hence, we pass the following order-

D (a) This appeal is allowed, and the order dated 8.9.2009
passed by the learned Single Judge of Bombay High Court, in
Writ Petition No. 5023/2009 filed by the respondents is set
aside. The said Writ Petition shall stand dismissed.

E (b) The order dated 30.3.2009 passed by the Court of
Small Causes, Mumbai rejectins;i respondents' application
objecting to the maintainability of appellant's Application
No.RAN24/SR/08 for fixation of Standard Rent is upheld. The
said Standard Rent Application will now be heard and decided
on its merits and in accordance with law.
F
(c) In the facts of this case, there-will be no order as to
costs.

N.J. Appeal allowed.