SHAH RASIKLAL CHUNILAL Vs. SINDHI SHYAMLAL MULCHAND

JUDGEMENT

(1.) This group of matter raises the third question which we have left open in our earlier decision in Letters Patent Appeal No. 35 1969 and S. A. No. 770 of 1960 decided on September 24 1970 (Hussain Dadu & Anr. v. Kunvarbhai Prabhudas XI G.L.R. 610) where this Division Bench had disposed of the two questions as to when a consent decree operates as a lease and when it could be said to be a penal decree so as to justify equitable relief against forfeiture or such penalty. The third question which was left open was as to when the consent decree could be treated as a nullity even by an executing Court or in a collateral proceeding. This third question has been raised in these matter because of the three latest decisions of the Supreme Court in this connection. As regards the true ratio of these decisions there has been a difference of opinion amongst the various Single Judges of this Court. Brother Sheth J. has therefore made a Reference in the last two referred matters by formulating the question for our answer in the following terms:-

(2.) Before going into the ratio of these three decisions it would be material at the outset to examine certain settled principles on the basis of which such a contention of nullity could be gone into by the executing Court. In Ahmedabad Municipal Corporation v. Joitaram X G.L.R. 431 speaking for the Division Bench consisting of myself and Thakore J. I had pointed out the settled legal position especially after Hiralal Patni's case A.I.R. 1962 S.C. 199 at page 201 that the executing Court could go into the question of validity of a decree only on the short ground that the decree was a nullity in the true sense. In such a case the distinction must always be kept in mind between the objections which are of a technical nature and which could be waived. It is only the objection as to the competence of the Court over the subject matter to try the suit or over the parties which could not be waived and which would therefore render a decree a nullity in the true sense and such an objection alone could be raised before the executing Court or even in the collateral proceedings. This conclusion was arrived at on the application of the settled workable test as evolved by Justice Cole ridge in Homes v. Russel (1841) 9 Dowl 487 as under:-

(3.) In this connection another settled principle must also be borne in mind. As Farewell J. pointed out in Soho Square Syndicate Ltd. v. E. Pollard & Co. Ltd. 1940 A. E. R. 601 at page 605 prohibition against contracting out of a statute even when it is not express can be implied by considering whether the Act is ore which is intended to deal with the private rights only or whether it is an Act which is intended from the point of view of public policy to have a more extensive operation. It is rightly not disputed that a statute like the Rent Restriction Act even if it does not contain an express provision prohibiting contracting out would have to be read as containing this implied prohibition on wider grounds of public policy. In these days of shortage of housing accommodation and of business premises in the areas where such Rent Restriction Acts are brought into force their object is to control rents and to protect tenants from eviction. In the context of such Rent Restriction Act therefore which are enacted in the interest of public peace and welfare the extension operation is clearly intended. Such statutes could not be interpreted as merely giving individual protection They rest on a more solid basis of the wider public policy. That is why even when an express provision prohibiting contracting out is not enacted such a prohibition would have to be read by implication consistently with the public policy underlying such a welfare measure. In Barton v. Fincham 1921 (2) K. R. 295 the Court of Appeal considered the scheme of the corresponding Rent Restriction Act 1920 The relevant sec. 5 created a restriction that no order or judgment for the recovery of possession of a dwelling house to which the Act applies can he made unless one or the other ground was made out. In the context of such a Rent Restriction Act scheme Bankes L. J. held at pages 295-295 that the legislature had secured its object as regards claims for possession by placing fetter not upon the landlords action but upon the action of the Court by definitely declaring that the Court shall exercise its jurisdiction only in the instances specified in the section and in no others. The legislature had in clear unmistakable language restricted the jurisdiction of the Court and therefore no agreement between the parties could give the Court a jurisdiction which the legislature had said it was not to exercise. The legislature had limited the exercise by Court of their full jurisdiction. Atkin L. J. at page 299 further observed that sec. 5 of the Act definitely limited the jurisdiction of the Court in making ejectment orders in the case of premises to which that Act applied and parties could not by agreement give the Courts jurisdiction which the legislature had enacted they were not to have. Atkin L J. however clarifies the position by stating that if the parties before the Court admitted that one of the events had happened which gave the Court jurisdiction and there was no reason to doubt the bona fides of the admission the Court was under no obligation to make further inquiry as to the question of fact; but apart from such an admission the Court could not give effect to an agreement whether by way of compromise or otherwise inconsistent with the provisions of the Act. In Thorne v. Smith 1947 (1) K. B. 307 at page 313 this decision was sought to be distinguished before the Court of Appeal on the ground that the consent decree was invalid because the relevant ground was not set out as the basis of the plaintiffs claim that he required the house for his own residence and the eviction order was obtained merely on the of the tenant without any inquiry by the concerned Judge. At page 314 Bucknill L. J. in terms pointed out that if the landlord by his own statement had satisfied the tenant that he intended to occupy the house himself and that the tenant could not successfully resist the claim and in these circumstances the tenant had stated this expressly in the Court the Judge would surely have had the jurisdiction to make the order on that ground. As the defendant was legally represented the Judge was entitled to make an order on the assumption that this was the true position. Before making an order for possession the Judge was under a duty to satisfy himself as to the truth if there was dispute between the landlord and-the tenant but if the tenant had in effect agreed that the landlord had a good claim to an order under the Act the Judge had jurisdiction to make the order for possession under the Act without further inquiry. Somerwell L. J. at page 315 rightly pointed of that as the defendant was legally represented the County Court Judge was rightly satisfied that the order could be properly made on the consent of the tenant. Somerwell L. J. in this context made the pertinent observation which would be very appropriate in the present cases as regards the express consent order which would suggest some compromise or which might be inconsistent with the provisions of the Act. The learned Judge observed when the defendant is agreeing to submit to judgment because he is satisfied that the plaintiff can establish his right to an order under the Acts it might be advisable to avoid the use of the word consent which may have a wider meaning and cover cases where the consent was the result an arrangement which could not properly be made the basis of an order. Therefore forbidden consent decree in violation of the latter created by the relevant Rent Act would be only those consent orders which are inconsistent with such Acts or which are in other words forbidden eviction decrees which are purely the result of an agreement which could not properly by mad:- basis of such eviction order because of the fetter placed by the legislature on the full jurisdiction of the Court. In Middleton v. Baldock 1950 (1) K. R 657 the strong Bench of the Court of Appeal consisting of Evershed M. R. Denning L. J. and Jenkins L. J. again considered these two authorities. Jenkins L. J. at page 669 deduced the following principle from the aforesaid two decisions:-_