CONSTITUTIONAL VALIDITY OF TAMIL NADU BUILDINGS LEASE AND RENT CONTROL ACT XVIII OF 1960 M/S BAPALAL AND COMPANY Vs. THAKURDAS

JUDGEMENT

(1.) THIS matter comes up 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 latter stood transferred to the City Civil Court at Madras and renumbered as o. S. No. 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 XXXIV of 1980 ). When the matter was pending before the City Civil Court an application was filed by the petitioners-plaintiffs in Tr. C. M. P. No. 4374 of 1981 under Article 228 of the Constitution of India for withdrawal of the said suit from the City Civil Court for disposal by this Court. Since all cases which are transferred to or withdrawn by the High Court under Article 228 of the Constitution are to be heard by a Bench in view of Order 1, rule 2 (8) of the Appellate Side Rules of this Court,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 Bazaar, Madras-3 from about the year 1938. On 25th April, 1949 one S. V. Ramakrishna Muda-liar, 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 25th April, 1949. The said suit was decreed on 22nd August, 1950. But the 7th defendant had failed to execute the lease deed as per the decree. Therefore, the Court executed a lease deed, dated 6th August, 1951 for a period of 15 years from 1st August, 1949. Since the said lease deed provided for an option for renewal of the lease in favour of the plaintiffs for a further period of 15 years from 1st August 1964 on the same terms and conditions, the plaintiffs exercised their option by their letter, dated 30th January, 1964 and called upon 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. No. 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 21st September, 1970. There was an appeal by the 7th defendant in A. S. No. 170 of 1961. In that appeal there was a decree by consent on 2nd May, 1975 and pursuant to the said compromise decree, the trial Court executed a lease deed on 26th August, 1977. on behalf of the 7th defendant for a period 25 years from 1st May, 1975 on condition that the plaintiffs pay Rs. 750, per month as rent from 1st May, 1975 to 31st Tuly, 1985. at Rs. 875, per month from 1st August, 1985 to 31st July, 1990, at Rs. 1,000, per month from 1st August, 1990 to 31st July, 1995 and at rs. 1,125. per month from 1st August, 1995 to 31st July, 2000. Subsequently, the 7th defendant had sold the premises to defendants 1 to 6 under a registered sale deed dated 12th March, 1979. Defendants 1 to 6 by their letter, dated 15th march, 1979 informed the plaintiffs of their purchase of the premises from the 7th defendant and called upon them to attorn and pay the rents to them. 7'th plaintiffs expressed their willingness by their letter, dated 30th April, 1979 to attorn to defendants 1 to 6 under the terms of the lease deed, dated 26th august, 1977. Defendants 1 to 6 thereafter filed before the Rent Controller on 3rd April, 1979 two petitions, one for fixation of fair rent at Rs. 1,250. under section 4 of the Tamil Nadu Buildings (Lease and 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 section 14 (1) (b) of the said Act on the ground of demolition and reconstruction. The plaintiffs had been served with notice 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 the following reliefs: " (a) For declaring that the rights and liabilities between the plaintiffs as lessees and defendants 1 to 7 as lessors are exclusively governed by the lease deed, dated 26th August, 1977 and by the provisions of the Transfer of Property Act, 1882; (b) for declaring that the Rent Controller has no jurisdiction to entertain and proceed with H. R. C. Petition Nos. 1146 and 1147 of 1979. (c) for declaring that the Tamil Nadu Buildings (Lease and rent Control) Act, 1960 is wholly ultra vires and void and restraining the state of Tamil Nadu by injunction from taking any action under the Act or enforcing the provisions of the Act. (d) for declaring that sub-clause (iii) in section 30 of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 exempting non-residential buildings with rent above Rs. 400 per month inserted by Tamil nadu Act IT of 1962 is in force notwithstanding the purported repeal thereof by tamil Nadu Act II of 1964. "

(3.) WITH reference to the above pleadings, the following issues arise for consideration: (1) Are defendants 1 to 6 entitled to take proceedings for eviction of the plaintiffs or for fixation of fair rent under the provisions of the Act during the subsistence of the registered lease deed, dated 26th August, 1977 fixing the term 1st May, 1975 to 31st July, 2000 (2) Are the rights and liabilities of the plaintiffs as lessees and the defendants 1 to 7 as lessors exclusively governed by the lease deed and the provisions of the Transfer of Property Act, 1882 and not by the provisions of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 during the subsistence of the lease as claimed by the plaintiffs " (3) Does the Act fall under Entry 18 of List II of the 7th Schedule or whether it falls under Entry 6 of List III" (4) If the law is taken to fall under Entry 18 of List II is the President competent to give any assent thereto under clause (2) of article 254 of the Constitution" (5) Whether the assent given by the President for the Act in question is invalid for any reason" (6) Whether the Amending Act II of 1964 is violative of the plaintiffs'fundamental rights conferred by Articles 14 and 19" (7) Whether the Act in so far as it converts the contractual tenancy into a statutory tenancy even before the expiry of the term is unconstitutional and void" (8) Are the plaintiffs entitled to the reliefs claimed in the plaint"