1961 (4) TMI 89 - SC - Indian Laws

Supreme Court affirms decision quashing exemption order under Madras Buildings Act

The Supreme Court upheld the High Court's decision to quash the State Government's order exempting a theater from the Madras Buildings (Lease & Rent ... - Issues Involved:1. Constitutionality of Section 13 of the Madras Buildings (Lease & Rent Control) Act, 1949.2. Legality of the State Government's order exempting the premises from the Act.3. Whether the High Court was correct in quashing the Government's order.Detailed Analysis:1. Constitutionality of Section 13 of the Madras Buildings (Lease & Rent Control) Act, 1949:The primary issue was whether Section 13 of the Madras Buildings (Lease & Rent Control) Act, 1949, which allowed the State Government to exempt any building from the Act, violated Article 14 of the Constitution. The contention was that this section conferred arbitrary power on the Government, leading to unequal application of the law.Judgment Analysis:The Court held that Section 13 did not offend Article 14. The preamble and operative provisions of the Act provided sufficient guidance for the exercise of the discretionary power vested in the Government. The Act aimed to regulate letting, control rents, and prevent unreasonable eviction of tenants. The power of exemption was intended to address situations where the statutory protection might cause undue hardship to landlords or be abused by tenants. The Court agreed with the High Court that while the section was constitutionally valid, individual orders of exemption could be subject to judicial review to ensure they were not discriminatory or malafide.2. Legality of the State Government's Order Exempting the Premises:The second issue was whether the State Government's order exempting the Gaiety Theatre from the Act was valid and within the scope of Section 13.Judgment Analysis:The High Court had quashed the Government's order on the grounds that the reasons for the exemption were not germane to the policy and purpose of the Act. The reasons given by the Government included:- The appellant's father had a valid lease under High Court orders.- The operation of the Act caused hardship to the appellant.- The second respondent was an absentee lessee with other businesses.- The second respondent's conduct was that of a hard litigant exploiting the law.- The second respondent had already enjoyed possession beyond the legitimate term.The High Court found these reasons insufficient and irrelevant to the Act's purpose, which was to prevent unreasonable eviction due to the scarcity of accommodation. The mere expiry of the lease term was not a valid ground for exemption as it contradicted the Act's protective intent.3. High Court's Authority to Quash the Government's Order:The third issue was whether the High Court had overstepped its jurisdiction by quashing the Government's order.Judgment Analysis:The Supreme Court held that the High Court was within its rights to review the Government's order under Article 226, especially if the order was discriminatory or ultra vires. The High Court had not acted as an appellate authority but had examined whether the reasons for the exemption aligned with the Act's policy. The Court agreed with the High Court that the reasons provided by the Government did not justify the exemption under the Act's objectives.Separate Judgment by Sarkar, J.:Justice Sarkar agreed with the majority on the constitutionality of Section 13 but differed on the legality of the Government's order. He argued that the Government's action was within the scope of the Act and that the High Court had erred in its approach. He emphasized that the Government's decision should be respected unless it was shown to be for an extraneous purpose. He concluded that the exemption was justified given the unique circumstances of the case, including the High Court's orders and the appellant's reliance on those orders.Conclusion:The majority judgment upheld the High Court's decision to quash the Government's order, finding that the reasons for the exemption were not aligned with the Act's purpose. The appeal was dismissed with costs awarded to the second respondent. Justice Sarkar's dissenting opinion, however, found the Government's order to be valid and within the scope of the Act.