PANNALAL JAGANNATH PRASAD GUPTA Vs. THE STATE OF MADRAS REPRESENTED BY THE SECRETARY HOME DEPARTMENT AND ANR.

JUDGEMENT

(1.) THIS petition under Article 226 of the Constitution seeks to have G.O. Ms. No. 705, Home, dated 19th March, 1958 quashed which, in exercise of the powers under Section 13 of the Madras Buildings (Lease and Rent Control) Act, 1949, exempted premises Nos. 140/2, Audiappa Naicken Street and 17/1, Anna Pillar Street, G.T., Madras, from the provisions of Section 7 of the said Act. The petitioner avers in his affidavit that the building No. 140/2, Audiappa Naicken Street, is a nonresidential one, and this is not in dispute, and he has been in occupation thereof for over 30 years. He further alleges that at the time of the occupation, the building was an old dilapidated one and he had to reconstruct it himself at enormous cost, and that he had installed an electric coffee roaster and two electric coffee grinders. The 2nd respondent, who was his employee, purchased the building from its owner on nth July, 1955. Although the 2nd respondent is occupying five stores for purposes of his business in the Kotwal Bazaar Market, and did not need the said building for carrying on his business, he applied to the Government for exempting it from the provisions of Section 7 of the said Act which the petitioner opposed. Eventually the Government by their memorandum, dated 26th November, 1956 informed the 2nd respondent that his request could not be complied with. But on 5th October, 1957 the 2nd respondent again applied to the Minister -in -charge of Accommodation and Control with a similar request practically on identical grounds, namely, that he required the premises for his own occupation to meet the requirements of his increasing business. Once again, the petitioner preferred his objections. But the Government after calling for a report from the Accommodation Controller passed the order now sought to be set aside. The petitioner contends, on these facts and circumstances that the order is arbitrary and unreasonable and should be set aside. On the other hand, the 2nd respondent opposes the petition and maintains that the Government granted the exemption as they were convinced that the petitioner was in genuine need of the building purchased by him in the normal course of expansion of his business and that the order is perfectly valid. The State of Madras, the 1st respondent, has also filed a counter -affidavit in which the Government have pleaded in justification of the order.

(2.) THE constitutional validity of Section 13 of the Act was upheld by a Division Bench of this Court in The Globe Theatres, Ltd. v. The State of Madras, (1954) 2 M.L.J. 110, on the view that the discretion given to the Government under the section was not an unguided and arbitrary discretion and that it should be exercised consistent with the declared policy and object of the Act as evidenced from its Preamble and operative provisions and neither arbitrarily nor mala fide. But at the same time, it was pointed out that the propriety or otherwise of the exercise of discretion in particular orders of exemption under Section 13 of the Act would be subject to judicial review. Dismissing the appeal from that decision, the Supreme Court in P.J. Irani, Administrator to the Estate of Late Mr. J.H. Irani v. The State of Madras C.A. No. 671 of 1957 which does not so far appear to have been reported, has confirmed the constitutional validity of Section 13 and the view that orders passed under the section are subject to scrutiny by Courts to find out whether they are in accord with the policy and purpose of the Act. In between the two decisions, there have been cases decided by single Judges or Division Benches of this Court in which, in the context of the special facts in each of them, observations have been made as to what was or was not a relevant or pertinent fact or circumstance to be taken into account by the Government in exercising their discretion in exempting or declining to exempt a building from the provisions of Section 7 of the Act. Such observations have been pressed into service as precedents and arguments addressed in support or attack of the order now under review. But, in my opinion each case will have to be examined on its own facts and in all their setting for the Court to satisfy itself that the impugned order is not an arbitrary or unreasonable exercise by the Government of their discretion contrary to the policy and purpose of the Act. After pointing out with reference to the Preamble of the Act its three -fold purpose, namely, (1) the regulation of letting, (2) the control of rent and (3) the prevention of unreasonable eviction of tenants from residential and non -residential buildings, the majority of the Bench of the Supreme Court in P.J. Irani v. State of Madras C.A. No. 671 of 1957 were pleased to affirm that any exercise of discretion in individual cases would be subject to review by the Courts for finding out whether (a) it was discriminatory so as to offend Article 14 of the Constitution, (b) the order was made on grounds which were germane or relevant to the policy and purpose of the Act and (c) it was not otherwise mala fide and proceeded to observe:

(3.) SRI V.C. Gopalarathnam, the learned Counsel for the petitioner pressed upon me that the impugned order was passed arbitrarily in disregard of the fact that on identical grounds, the Government themselves had earlier declined to exempt the building under Section 13 of the Act, that there was no fresh material relevant to the policy and purpose of the Act, which justified the Government to revise their previous order, and that, even assuming that it was open to the Government to support the order in question by reasons not mentioned therein but in their counter -affidavit, none of them was a legitimate and relevant one in relation to the policy and purpose of the Act. The learned Counsel also suggested that apparently a change in the personnel of the Ministry was the only factor that accounted for the exemption. I may at once state that, in my view, the last of the contentions is totally without substance and deserves no further consideration. There is no material to support the allegation and the mere fact that the earlier order happens to be revised, is no justification for the allegation. In respect of the other submissions of the learned Counsel, Sri K.V. Venkatasubramania Ayyar, appearing for the 2nd respondent -landlord, urged that the Government did have fresh materials, should they be required, for revising the earlier order, in the form of a lease deed aforesaid and the offer of the 2nd respondent to put the tenant in occupation of three stalls subject to the permission of their owner, and that the bona fide need of the 2nd respondent for occupation of the building for purposes of his expanding business was by itself a proper and relevant ground that justified the exemption. Sri K.V. Venkatasubramania Ayyar did not seriously press grounds (i), (ii) and (v) set out in the counter -affidavit of the Government though he did not concede that they too could be relevant grounds. But the learned Counsel maintained that grounds (iii) and (iv) were certainly relevant and sufficient to support the order of the Government.