BAPALAL AND CO Vs. P THAKURDAS

JUDGEMENT

(1.) This matter comes before us in the following circumstances. The petitioners and respondents herein are the plaintiffs and defendants respectively in C. S. No. 547 of 1979 on the file of this court which later stood transferred to the City Civil Court at Madras and numbered as 0. S. 2646 of 1981 as a result of the enhancement of the jurisdiction of the City Civil Court by the City Civil Court Amendment Act (Tamil Nadu Act 34 of 1980). When the matter was pending before the City Civil Court an application was filed by the petitioner-plaintiffs in Tr. C. M. P. 4374 of 1981 under Art. 228 of the Constitution of India for withdrawal of the~ said suit from the City Civil Court for disposal by the High Court. The said application was allowed by a Division Bench of this court and the suit was withdrawn for disposal by this court. Since all cases which are transferred or withdrawn by the High Court under Art. 228 of the Constitution are to be heard by a Bench in view of O. 1, R. 2 (8) of the Appellate Side Rules of this Court, the suit itself has come up before us for disposal in the form of a referred case.

(2.) Before going into the various factual and legal contentions raised in the pleadings, the facts which are not in controversy between the parties may briefly be stated. One Messrs Bapalal & Co., a firm of diamond merchants and jewellers (plaintiffs in the suit) were lessees of a portion of the premises called 'Ramakoti buildings' at No. 47-51 Irusappa Maistry Street, also known as Rattan Bazar, Madras-3 from about the year 1938. On 25-4-1949 one S. V. Ramakrishna Mudaliar, the owner of the premises agreed to execute a lease deed in their favour according to the terms and conditions mentioned therein for ''a period of 15 years. However, as the said Ramakrishna Mudaliar (7th defendant) failed to execute the lease deed as agreed upon, the plaintiffs had filed a suit C. S. No. 238 of 1950 on the file of this Court for specific performance of the said agreement dated 25-4-1949. The said suit was decreed on 22-8-50. But the 7th defendant had failed to execute the lease deed as per the decree. Therefore, the court executed a lease deed dated 6-8-1951, for a period of 15 years from 1-8-1949. Since the said lease deed provided for an option for renewal of the lease in favour of the plaintiff for a further period of 15 years from 1-8-1964 on the same terms and conditions, the plaintiffs exercised their option by their letter dated 30-1-1964 and called on the 7th defendant to execute and register a lease deed for that purpose. Since the 7th defendant refused to renew the lease, the plaintiffs again filed O. S. 4547 of 1966 on the file of the City Civil Court, Madras for the specific performance of the agreement to renew. The said suit was decreed after contest on 21-9-1970. There was an appeal by the 7th defendant in A. S. No. 170 of 1971. In that appeal there was a decree by consent on 2-5-1975 and pursuant to the said compromise decree, the trial court executed a lease deed on 26-8-1977 on behalf of the 7th defendant for a period of 25 years from 1-5-1975 on condition that the plaintiffs pay Rs. 750 per month as rent from 1-5-1975 to 31-7-1985 at Rs. 875 per month from 1-8-1985 to 31-7-1990, at Rs. 1000 per month from 3-8-1990 to 31-7-1995 and at Rs. 1,125 per month from 1-8-1995 to 31-7-2000. Subsequently the 7th defendant had sold the premises to defendants 1 to 6 under a registered sale deed dated 12-3-1979. Defendants 1 to 6 by their letter dated 15-3-1979 informed the plaintiffs of their purchase of the premises from the 7th defendant and called upon them to at torn and Pay the rents to them. The plaintiffs expressed their willingness by their letter dated 30-4-1979 to attorn to defendants 1 to 6 under the terms of the lease deed dated 26-8-1977. Defendants 1 to 6 thereafter filed before the Rent Controller on 3-4-1979 two petitions one for fixation of fair rent at Rs. 12,150 under S. 4 of the Tamil Nadu Buildings (Lease and Rent Control) Act 1960 in the place of the agreed rent of Rs. 750 per month as per the lease deed and the other for eviction of the plaintiffs under S. 14 (1) (b) of the said Act, on the ground of demolition and reconstruction. The plaintiffs had been served with notices in the said two petitions. As soon as the plaintiffs received notices from the Rent Controller in the two petitions, they have come forward with the present suit seeking following reliefs:-

(3.) The above reliefs have been claimed by the plaintiffs on the basis of the following contentions which have been raised in the plaint. (1) The petitions filed by defendants 1 to 6 for fixation of fair rent and for eviction are not maintainable in law as the Act is unconstitutional, ultra vires and void. (2) The State Legislature had no legislative competence to enact the Act in question under Entry 18 of List II or under Entry 6 of List III of the 7th Schedule to the Constitution for the expression 'land' occurring in Entry 18 cannot include buildings nor will it amount to transfer of property other than agricultural land occurring in Entry 6 of List III of the 7th Schedule. (3) Even if the Act is taken to be a law with respect to 'Transfer of property falling in Entry 6 of List II, the entire Act which is a post-Constitutional law is unconstitutional and void as repugnant to and violative of the fundamental rights to acquire and own property and carry on business guaranteed by Art. 19 (1) M and (g) of the Constitution and the right to equal protection of the laws guaranteed by Art. 14 of the Constitution as leasehold right is an interest in immovable property. (4) The Act is also void because the assent given by the President under Art. 201 of the Constitution is not a valid assent and therefore the Bill never became an Act at all. (5) In any event, the provisions of Tamil Nadu Buildings (Lease and Rent Control) Act 1960 hereinafter referred to as the Act, cannot be invoked until after the expiry of the lease granted in favour of the plaintiffs and that the rights and liabilities of the lessors and lessees have to be determined only with reference to the terms of the lease until the expiry of the lease period. (6) S. 30 of the Act as amended by Tamil Nadu Act 11 of 1964 brings in all nonresidential buildings within the scope of the Act while residential buildings fetching a rent of above Rs, 400 per month have been exempted from the provisions of the Act and therefore the denial of exemption for non-residential buildings fetching rents above Rs. 400 per month while such exemption is available for residential buildings is ultra vires as violating Art, 14 of the Constitution.