TaxTMI 
TaxTMI 
2007 (12) TMI 517
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....been sought in these petitions but broadly, they are of three categories. The relief sought in the first set of petitions is to declare the New Act as ultrayires to the Constitution of India; in the second set, relief prayed-for is to declare Section 32(3)(a) of the New Act as ultravires to the Constitution of India and the third set of petitions is about the relief as to declaring Section 6 of the Old Act as ultravires to the Constitution of India vis-a-vis to recall or refer for reconsideration to a larger bench, the judgment passed by this Court on 30.9.1999 in D.B. Civil Writ Petition No. 1193/1997 Khem Chand v. State of Rajasthan reported in whereby Section 6 (2) of the Old Act has been declared as ultravires to the Constitution of India. 2. We have heard learned Counsel for the parties at length including the learned Additional Advocate General and categorically scrutinized the case law cited. For the sake of convenience, first we take the contention of learned Counsel for the petitioners challenging the validity of the entire New Act with regard to legislative competency and being ultravires to Article 14 of the Constitution of India. The controversy whether the relati....
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....peding the growth of letable premises. Hence, adequate provision for timely vacation of premises as also determination of fair rent is the necessity of the hour. Certain inbuilt safeguards for tenants are also required to be retained and certain premises are required to be kept out of the scope of new law. It has, therefore, become necessary to replace the existing law relating to control of rent and eviction of premises. 4. Chapter 2 of the New Act dealing with the revision of rent under Section 6 and Chapter VIII dealing with repeal & saving clause under Section 32 of the New Act corresponding to Section 6 of the Old Act, have much been debated in the second and third category of petitions and will be dealt with later on. Rest of the provisions of the Old Act have been either amended or modified or repealed in the light of the Objects & Reasons given under the new Bill as indicated above. How far the Court can declare it to be ultravires to the Constitution of India, being violative of Article 14, is a subject of decisive controversy in the present petitions. 5. The Constitution of India is a paramount law which represents the will of the people and is a mechanism under whi....
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....the Old Act, the most important addition in the New Act is about non-applicability of these provisions of Chapter 2 and 3 of the Old Act on the premises as indicated below by virtue of Clauses (i), (ii) and Sub-clauses (a), (b) & (c) of Clause (iii) of Section 3 of the New Act, which reads as under: Section 3. Chapters II and III not to apply to certain premises and tenancies - Nothing contained in Chapters II and III of this Act shall apply,- (i) to the new premises built or completed after the commencement of this Act and let out through a registered deed in which date of completion of such premises is mentioned; (ii) to the premises existing at the commencement of this Act, if let out after such commencement for a period of five years or more through a registered deed and the tenancy is not terminable before expiry of its duration at the option of the landlord; (iii) to any premises let out for residential purposes before or after the commencement of this Act, the monthly rent whereof is rupees seven thousand or more, in the case of the premises situated in the Municipal area of Jaipur City; rupees four thousand or more, in the case o....
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....e Rent Act only to those premises for which rent is payable up to the sum of Rs. 3500 per month and has decided not to extend this statutory protection to the premises constructed on or after the date of coming into operation of the Amending Act for a period of ten years. This is a matter of legislative policy. The legislature could have repealed the Rent Act altogether. It can also repeal it step by step. It has decided to confine the statutory protection to the existing tenancies whose monthly rent did not exceed Rs. 3500. 29. In our view, it is for the legislature to decide what should be the cut-off point for the purpose of classification and the legislature of necessity must have a lot of latitude in this regard. It is well settled that the safeguard provided by Article 14 of the Constitution can only be invoked, if the classification is made on the grounds which are totally irrelevant to the object of the statute. But, if there is some nexus between the objects sought to be achieved and the classification, the legislature is presumed to have acted in proper may result in some hardship. But, a statutory discrimination cannot be set aside, if there are facts on the bas....
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....riate legislature may, by law, provide for adjudication or trial by tribunals of any dispute, complaints or offences with respect to all or any of the matters specified in Clause (2) with respect to which such legislature has power to make laws. Sub-clause (h) of Clause (2) of Article 323B has been inserted by the Constitution 75th Amendment Act of 1993, whereby the rent, its regulation, control and tenancy issues including the right, title & interest of landlord and tenants had been incorporated in it. Therefore, the validity of Chapter 5 of the New Act regarding constitution of the Rent Control Tribunals cannot be also termed as violative of Article 14 of the Constitution. 15. Fixing the criterion of applicability under the New Act for a specified rent rate arid classifying tenants for residential & commercial purposes on time demand, cannot be termed as violative of fundamental right, as the right conferred on the tenant under the rent Law is a protective or legal right under a statute which can be termed as a mere civil right and not a fundamental right and it is within the domain of the legislature to make such a classification of tenant and periodical revision of rent, eco....
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....suits for increase of rent at exorbitant rate were filed and likewise the provisional rent under Section 7 of the Old Act was also fixed at abnormal high rates. Whereas in the New Act, the premises which were let out prior to 1.1.1950 have been treated to have been let out on that day and an annual increase of 5% has been provided which is revisable after every ten years. This is a just, reasonable & fair criteria & to put check on monopoly by landlords in increasing rent. 19. Learned Counsel has also cited certain examples as to how the rents were claimed in between this period and the Civil Courts passed the orders. Some of the examples are as follows: (1) Raj Kumar (Writ Petition No. 5842/2004) Shop in question was taken on rent in Bhadwa Samvat Year 2043 at the rate of Rs. 550/- pm. The landlord filed suit under Section 6 of the Old Act in May 2001 and claimed rent at the rate of Rs. 8000/- per month. The Trial Court passed the decree for Rs. 8000/-. As per Rent Act of 2001, rent in May 2001 will be Rs. 1031/- (2) Pritam Singh (Writ Petitions No. 3356/2004 and 5604/2004) House in question was taken on rent on 4th July, 1975 at the rate of Rs. 555/-pm. The l....
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....e of the New Act at the rate of Rs. 5000/-, whereas under the New Act, he has to pay only 5% increase of the agreed rent. According to learned Counsel for the petitioners, large number of such type of cases have been instituted in various courts and are pending and by virtue of this saving clause, a great anomaly and inconsistency has been created. 21. Not only this, a tenant has no right to file an application for revision of rent under the New Act and on the contrary, a suit filed by the tenant for fixation of standard rent under the Old Act on account of excessive rate of rent is pending on the date of coming into force of the New Act and after coming into force of this New Act, if landlord files a suit for revision of rent under Section 6 of the New Act, in such a situation, the civil Court will decide the application of the tenant under Section 6 of the Old Act and the Tribunal will decide the application of the landlord for revision of rent under Section 6 of the New Act, Decision of two courts on same issue is bound to result in miscarriage of justice. 22. This type of legislative drafting resulting in inconsistency & anomaly, without examining the corresponding effect....
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....basic rent thereof: Provided further that where the fair rent or standard rent for any premises has been determined or redetermined (by any court under this Act or) by any authority under any law or order repealed by Section 30 before the commencement of the Rajasthan Premises (Control of Rent and Eviction Amendment) Ordinance, 1975 and the amount of such fair rent or standard rent is the same as would be determinable as standard rent by the Court under this section, the fair rent or standard rent previously determined or redetermined, shall not be disturbed. (3) Where for any reason it is not possible to determine the standard rent of any premises on the principles set out in Sub-section (2); the Court shall determine such rent, having due regard to (xxxx) the prevailing rent or standard rent for similar premises in the same locality, the various amenities (such as electricity, water connection, sanitory fittings, and the like) attached to the premises, the cost of construction, maintenance and repairs thereof, the special reasons, if any; proved by the plaintiff and other relevant considerations. In fixing the standard rent for any premises under this s....
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....ed upto the year of the commencement of this Act and amount of increase of rent shall be merged in rent. The rent arrived at according to the formula given in Sub-sections (1) and (2) shall, after completion of each year from the year of commencement of this Act, again be liable to be increased and paid at the rate of 5% per annum and the amount of increase of rent shall be merged in such rent after ten years. Such rent shall further be liable to be increased at similar rate and merged in similar manner till the tenancy subsists. The rent revised as per formula given under Sub-section (1) or Sub-section (2) shall be payable, after the commencement of this Act, from the date agreed upon between the landlord and the tenant or where any petition is filed in a Rent Tribunal, from the date of filling of such petition. Section 7. Revision of rent in respect of new tenancies.- (1) In the absence of any agreement to the contrary, the rent of the premises let out after the commencement of this Act shall be liable to be increased at the rate of 5% per annum and the amount of increase of rent shall be merged in such rent after ten years. Such rent shall further be l....
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....said that you must see whether the true effect was to substitute something incompatible with the enactment in the Act repealed; and that, if you found something in the repealing Act incompatible with the general enactments in the repealed Act, then you must treat the jurisdiction under the repealed Act as pro tanto wiped out. 26. This dictum was followed from the decisions in In re Busfield reported in 32 Ch.D. 123 and Hume v. Somerton reported in 25 Q.B.D. 239. 27. On the controversy of repeal & saving as existing in the present petitions, learned Counsel for the petitioners Mr. M.C. Bhoot and Mr. Arun Calla, learned Counsel for the intervener, also relied upon certain citations referred below: 28. In Aswini Kumar v. Arabinda Bose reported in it has been held as under: 27. Nor can we read the non obstante clause as specifically repealing only the particular provisions which the learned Judges below have been at pains to pick out from the Bar Councils Act and the Original Side Rules of the Calcutta and Bombay High Courts. If, as we have pointed out, the enacting part of Section 2 covers all Advocates of the Supreme Court, the non obstante clause can reasonably be ....
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....epealed. Even if the later statute is in affirmative terms, it is often found to involve that negative which makes it fatal to the earlier enactment. 31. In Vishwant Kumar v. Madanlal Sharma reported in AIR2004SC1887 , it has been held as under: What is unaffected by repeal is a right acquired or accrued under the Act. Till the decree is passed, there is no accrued right. The mere right existing on date of repeal to take advantage of the repealed provisions is not a right accrued within Section 6(c) of the General Clauses Act. Further, there is a vast difference between rights of a tenant under the Rent Act and the rights of the landlord. 32. Karam Singh Sobti v. Sri Pratap Chand reported in [1964]4SCR647 , while interpreting the provisions of the Delhi & Ajmer Rent Control Act, 1952 and Delhi Rent Act 1958, the majority view was that the term "shall have regard to the provisions of this Act" means the Court shall have regard to the provisions of the New Act which makes a provision with the non obstante clause. In that case, the non-obstante clause under Section 57 of the Control Act of 1958 while repealing the Delhi and Ajmer Rent Control Act, 1952 was as follows: ....
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..... The Court further observed that the existing provisions provided the "pagri" system leading to lawlessness and undermining the authority of law. While relying upon this decision, Section 6(2) of the Old Act was struck down by the Division Bench of this Court in Khem Chand's case (supra). 35. Upon crystallization of the decisions referred-to above, now it is a well settled proposition of law that when a Statute is repealed, the Court loses jurisdiction of the suit pending under the repealed Act, as if it had never been passed, except for the purpose of those actions which were commenced, prosecuted and conducted whilst it was an existing law. Unconditional repeal of a Statute without a saving clause stops actions in all suits in which the final relief has not been granted as provided-for in Section 6 of the General Clauses Act. To overcome this hardship of common law, the legislature thought it fit from time to time that when both repeal and saving clauses are existing in the enactment and the Court finds that there is an irreconcilable inconsistency or incompatibility, the Court should treat the jurisdiction under the repealed Act as "protanto wiped out". This is commonly ....
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....he New Act had not been enacted. However, a right was given to the plaintiff to withdraw the suit or appeal or other proceedings under the Old Act within a period of 180 days of coming into force of the New Act and to file a fresh petition in respect of the same subject matter in accordance with the provisions of the New Act and that limitation was provided to be 270 days. 38. This non obstante clause, if read with Section 6 of the Old Act for fixation of standard rent and Section 6 of the New Act for revision of the rent with reference to Section 29 of the New Act dealing with the overriding effect, following anomaly, irreconcilable inconsistency and incompatibility emerges, in addition to the five instances, referred in preceding para 20 (supra), whereby there are instances of abnormal rise in fixation of standard and provisional rents by the Courts after coming into force of the New Act: 39. Under the non obstante clause provided-for in Section 32(3)(a) of the New Act, pending suits for fixation of rent either standard or provisional, shall be governed by the repealed Act, whereas under Section 29 of the New Act, the provisions of the New Act shall have effect notwithstand....
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....e draftsman of the present Bill looked into various provisions of the Model laws framed in the Country on rent matters and the decision of Khem Chand's case (supra) in proper perspective, this difficulty in harmonizing both the Acts i.e. the Old & the New Acts, would not have emerged by way of these petitions. To quote an example of the Delhi Rent Control Act of 1958, Section 57 of this Act clearly makes a proviso in the non obstante clause that pending proceedings for fixation of standard rent, the new Act shall apply but this provision was not inserted in the non obstante clause contained in Sub-section (3) of Section 32 of the Act. 42. Though, we are not questioning the policy of the legislature in enacting the new law which is a social legislation, being enacted from time to time keeping in view the paucity of accommodation and market value of the rupee but as discussed above, when incompatibility or irreconcilable inconsistency emerges in interpreting the new law, the Court has to harmonize provisions of both the Old & the New Acts. We, therefore, without striking down any of the provisions of the Old Act and the New Act, deem it proper that non-obstante clause containe....