Yogeshwar Dayal, J.:— The question involved in the appeal relates to the wires of Section 2(1) of the Delhi Rent Control Act amended vis-a-vis Article 14 of the Constitution of India inasmuch as by this definition of the expression ‘tenant’ the tenancy in relation to premises let for residential purposes is heritable to a limited extent whereas the tenancy in relation to premises not let for residential purposes is not so. This definition in Section 2(1) has been introduced with retrospective effect.

2. The question has arisen in view of the order of reference dated 5th March, 1981 passed by Wad, J. while hearing Regular First Appeal No. 521/69. Regular First Appeal No. 211 of 1981 is also placed before the Full Bench in view of the order of Goswamy, J. dated 30th November, 1981, directing this appeal to be heard along with RFA No. 521/69.

3. For understanding the controversy, we are giving salient facts of RFA No. 521/69.

4. The plaintiffs/respondents had filed the suit for possession and mesne profits against Sh. Mool Chand, predecessor-in-interest of the appellants herein. This suit was inter-alia filed on the allegations that the tenancy of Sh. Mool Chand was determined in his life time by a registered notice sent by the plaintiffs through their counsel which was duly served up in the said Shri Mool Chand and consequently, Shri Mool Chand after service of notice became a statutory tenant and after his death the tenancy rights of Sh. Mool Chand could not be inherited. These allegations were made on the assumption that the property in suit are shops. The suit of the plaintiffs was contested by the appellants inter alia on the ground that plaintiffs were not the owners of the property and that the tenancy of Sh. Mool Chand had not been determined. It was denied that the tenancy rights of Sh. Mool Chand were not heritable.

5. Learned trial court after recording evidence held that the plaintiffs were the owners and that the defendants cannot challenge the ownership. The learned trial court also held that the tenancy of Sh. Mool Chand was validly terminated during his life time vide notice Ex. P-3. Learned trial court also field that the statutory tenancy of Sh. Mool Chand was not heritable. Lenrned trial court consequently by the impugned order dated 23rd October, 1969 decreed the plaintiffs' suit for possession and also partly decreed the claim for mesne profits.

6. The defendants on being dis-satisfied have come up in this appeal During the pendency of the appeal clause (1) of Section 2 of the Delhi Rent Control Act, 1958 (Act No. 59 of 1958) (hereinafter referred to as ‘the Principal Act’) was amended by Delhi Rent Control (Amendment) Ordinance 1975 (No. 24 of 1975) hereinafter referred to as the Ordinance’) whereby Section 3 thereof, clause 2(1) was deemed to have been substituted by the newly substituted clause. Before the expiry of the aforesaid Ordinance, the Parliament passed Delhi Rent Control (Amendment) Act, 1976 (No. 18 of 1976) (hereinafter referred to as the ‘Amending Act.’) Section 2 of the Amending Act provided that, “In Section 2 of the Delhi Rent Control Act, 1958 (Principal Act) for clause (1) the following clause shall be, and shall be deemed always to have been, substituted, namely:—

(1) “tenant” means any person by whom or on whose account or behalf the rent of any premises is, or but for a special contract, would be, payable, and includes—

(i) a sub tenant;

(ii) any person continuing in possession after the termination of his tenancy; and

(iii) in the event of the death of the person continuing in possession after the termination of his tenancy; subject to the order of succession and conditions specified, respectively, in Explanation I and Explanation II to this clause, such of the aforesaid person's—

(a) Spouse,

(b) son or daughter, or where there are both son and daughter, both of them.

(c) Parents,

(d) daughter-in-law, being the widow of his pre-deceased son,

as had been ordinarily living in the premises with such person as a member or members of his family up to the date of his death, but does not include,—

(A) any person against whom an order or decree for eviction has been made except where such decree or order for eviction is liable to be re-opened under the proviso to section 3 of the Delhi Rent Control (Amendment) Act, 1976:

(B) any person to whom a licence, as defined by section 52 of the Indian Easements Act, 1882, has been granted……….

7. The Amending Act by section 1, sub-section (2) was deemed to have come into force on 1st December, 1975.

8. Section 3 of the Amending Act is a saving provision and provides for re-opening of certain proceedings which reads as under:—

‘“3. Nothing contained in the principal Act, as amended by this Act, shall be deemed to authorise the re-opening of any proceeding for—

(a) the fixation of standard rent in relation to any premises to which the principal Act applies; or

(b) the eviction of any person from any premises to which the principal Act applies; and

(c) any other matter which the Controller is empowered, by or under the principal Act, to decide, if such proceeding had been finally disposed of before the commencement of this Act:

Provided that if, in relation to any proceeding which had been finally disposed of before the commencement of this Act, the Controller is satisfied that the landlord had not recovered possession of the premises in relation to which the decree or order for eviction of the person in possession thereof was made, he shall, if such person by a written application made within ninety days from such commencement so desires, set side such decree or order and reopen the proceeding for such eviction and decide such proceeding in accordance with the provisions of the principal Act as amended by this Act.”

9. Clause (1) of the section 2 of the Principal Act before the passing of the Amending Act read as under:—

“(1) “tenant” means any person by whom or on whose account or behalf the rent of any premises is, or but for a special contract would be, payable and includes a sub-tenant and also any person continuing in possession after the termination of his tenancy but shall not include any person against whom any order or decree for eviction has been made;”

The statement of objects and Reasons for the Amending Act reads as under:—

“There has been a persistent demand for amendments to the Delhi Rent Control Act, 1958, with a view to conferring a right to tenancy on certain heirs/successors of a deceased statutory tenant go that they may be protected from eviction by landlords and also for simplifying the procedure for eviction of tenants in the case the landlord requires the premises bona fide for the person occupation. Further, Government decided on 9th September, 1975, that a person who owns his own house in his place of work should vacate the Government accommodation allotted to him before the 31st December, 1975. Government considered that in the circumstances, the Act required to be amended urgently”.

The scope and effect of the substituted clause 2(1) as introduced by the Amending Act vis-a-vis heritablility of tenancy which has been determined by notice to quit was considered by the Full Bench of this Court in Haji Mohammed Din and another v. Sh. Narain Dass, 1979 (1) All India Rent Control Journal, 129. The Full Bench held,

“that the words used in the amended definition of “tenant” to give the limited right to inheritance to such persons “as had been ordinarily living in the premises with such persons as members of his family upto the date of his death” have to be construed to mean that the benefit of amendment is available only when the tenancy was for residential purpose. It is only then that the heirs of the tenants could live with him in the premises at the time of his death. If the premises were not let for residential purpose then neither the tenant nor his heirs could be living in those premises.”

“After the death of a tenant, the right to continued occupation is available only in respect of residential premises and that too to the limited number of heirs specified in clause (1)(iii) aforesaid, if they fulfil the other conditions stated therein”.

The result of Haji Mohammed Din's case was that the statutory tenant, claiming a tenancy whereby a tenant continues even after determination of lease, ceases to be heritable expressly in so far as it related to premises which were not let for residential purpose.

10. This decision of the Full Bench vitally effects the decision of both the present appeals and when one of them came up before Wad, J., he passed the order of reference. Before the learned Single Judge, the vires of amended section 2(1) was challenged as being violative of Article 14 of the Constitution of India for creating artificial distinction between premises let for residential purpose. It was submitted that this was arbitrary classification which had no nexus to the purpose of the Act and was thus, void. It was further submitted that in the case of Damadilal and others v. Parashram and others, AIR 1976 Supreme Court 2229, the Supreme Court had held that the English concept of non heritability of statutory tenancy is not applicable in India and thus it was submitted that the classification in clause 2(1) between the premises let for residential purpose and the premises not let for residential purposes for the purposes of heritability is unreasonable and it has got no nexus with the object of the Principal Act and thus, void. And therefore, the old statutory definition given in section 2(1) of the principal act would revive and as per the interpretation given in Damadilal's case the statutory tenancy even in the present case become heritable. Before Wad, J. the decision of a Division Bench of this Court in H.C Sharma v. Life Insurance Corporation of India, I.L.R 1973 (1) Delhi, 90 was also brought to His Lordship's notice which had held that the classification between residential and non-residential premises in the Principal Act was not discriminatory and did not violate any provision of the Constitution.

11. Wad, J. appears to have been impressed by the arguments as to constitutional invalidity of the new definition of tenant as contained in clause 2(1) introduced by the Amending Act and has made the order of reference framing the following three questions:—

1. What is the differentia for distinction between the residential and non-residential premises in its application to heritability of statutory tenancy?

2. Is there any rational nexus between such a differentia and the object of classifications & the Act? and

3. Does the Division Bench judgment in Sharma's case conclude the controversy raised in this appeal?

12. It is for the consideration of these questions that the matter has now been placed before us.

13. For the urban area of Delhi, the first comprehensive legislation for control of rents and evictions was introduced by way of The Delhi and Ajmer-Merwara Rent Control Act, 1947 (Act No. XIX of 1947) (hereinafter referred to as “1947 Act”. Section 2(d) of the 1947 Act defined tenant as under:—

(d) “tenant” means a person who takes on rent any premises for his own occupation or for the occupation of any person dependent on him but does not include a collector of rents or any middleman who takes or has taken any premises on lease With a view to subletting them to another person.”

1947 Act also contained Section 7 providing for determination of standard rent in relation to certain premises and Section 7A provided for fixation of standard rent for certain newly constructed premises on different basis. Section 9 controls the eviction of tenant and provided a different grounds where landlord could seek eviction of a tenant but certain provisions of this section did not apply to premises which were not purely residential. The provisions contained in section 7 and 7a relating to fixation of standard rent made a marked distinction between the premises let for the purpose of residence. The grounds on which eviction could be ordered for premises which were not let for residential purpose were much more restricted than to premises which were let for residential purpose. For example on ground of bona fide personal requirement of the landlord no premises which were not let for use as residence could could be got vacated on the ground of bona fide requirement of landlord either for his residence or for his family. Similarly, if a tenant had built, acquired vacant possession or had been allotted suitable residence, his eviction could be claimed but there was no such right available to the landlord if the premises were let for residential purpose. There were some other grounds also on which premises could be got vacated which were let for residential purpose but could not be got vacated on those grounds if the premises were let for commercial purpose. Thus, there was a clear distinction between the premises let for residential purpose and the premises not let for residential purpose. 1947 Act was not applicable at all to vacant land. The 1947 Act was repealed by the Delhi and Ajmer Rent Control Act, 1952 (Act No. XXXVIII of 1952) hereinafter referred to as ‘1952 Act’ and this Act again contained provisions from Sections 6 to 9 for fixation of standard rent and provisions of Sections 6 to 8 read with second schedule to 1952 Act made the provision of determination of standard rent and made a distinction between different types of premises and provided different criteria for fixation thereof. There was clear cut different provision for fixing standard rent for premises let for residential purpose and those let for non-residential purpose.

14. Section 13 of the 1952 Act provided for control of eviction of a tenant and there again certain grounds of eviction were available where the premises let for residential purpose and were not so available where the premises were let for non-residential purpose. “1952 Act” was repealed and replaced by present Act of 1958, referred to earlier as ‘Principal Act’. The Principal Act again made provisions for fixation of standard rent by Sections 6 to 9 read with second schedule and this also makes clear cut distinction between the premises let for residential purpose and the premises which were not let for residential purpose. Similarly section 14 of the principal act after providing for ban from eviction of tenant from the premises…… by various clauses of proviso to sub section (1) lifted ban on eviction in certain circumstances and here again one finds the marked distinction of the grounds which are available for eviction of a tenant from the residential premises and those which are not available where the premises are not let for residential purposes.

15. Of course by the Amending Act certain special provisions have been made in Section 14A for recovery of possession of premises by certain Government servants. There are also special provisions for recovery of possession in respect of premises where the landlord is any Company or body corporate or any local authority or any public institution (See Section 22).

16. Resume of the 1947 Act, 1952 Act and 1958 (Principal Act) show a distinct classification being made in all this legislation between premises let for residential purpose and the premises not let for residential purpose. The preamble of the Principal Act provides, “for the control of rent and eviction ………. in certain area in the Union Territory of Delhi”. There can be no doubt that from the preamble one gauge broad purpose of the Act The purpose of the Act is inter alia “Control of evictions.” Principal Act applies only to the premises and not to vacant land. The purpose of the Principal Act is control of eviction and of banning of eviction. In Section 14, there is a provision for controlling of eviction. The control as stated earlier provides basic distinction between the premises let for residential purpose and the premises not let for residential purpose. The Legilature in its wisdom made this broad classification between two types of premises and or two types of letting purpose. This classification is reasonable. There can be no doubt about it. This classification is to stand the test of discrimination under Article 14 has also to have nexus with the purpose of the Act. This classification appears broadly in practically all the States in India. The other regional acts also contain definition of tenant which varies from State to State or in some case they are similar depending upon the requirement of that State, for giving protection or not giving protection. What we are trying to point out is that the classifications between residential and non-residential tenancy are well recognises. Reference may usefully be made to the Full Bench decision of the Madras High Court in Raval and Co. v. K.G Ramachandran and others, AIR 1967 Madras, 57 and distinction being made between open land and building and different grounds being provided for seeking ejectment. Reference can conveniently be made to the case of Mangharam Chuharmal v. B.C Patel & others. AIR 1972, Bombay 46. This distinction between tenant of residential premises and non-residential premises is also prevalent in England. See Rent Act by R.E Megarry, 10th Edition p.86 where distinction is made between dwelling house and business premises. This classification has always been upheld and has not been found to be discriminatory or unreasonable so as to hit by Article 14 of the Constitution of India. This Court also in the case of Shri H.C Sharma (supra) held that classification between the residential and non-residential was not discriminatory and did not violate any of the provisions of the Constitution.

17. Wad, J. has however, doubted this classification for judging its validity in its applicability to heritability of statutory tenancy only (See question No. 1).’

18. Once it is recognised that the classification between the residential and non-residential premises is valid and is reasonable and has nexus with the object of the Act, it goes without saying that the incidence of such classification may be different. One of the incidence which Wad, J. was considering was heritability in relation to statutory tenant. Once the classification is recognised as reasonable, the scope of protection for different premises may differ. One has to appreciate the classification broadly with the purppse of the Act and not every individual incident thereof. In Kewal Singh v. Mst. Laj Wanti, AIR 1980 Supreme Court 161 at page 168 in paras 21 and 22, Fazal Ali, J. speaking for the, Supreme Court made pertinent observations as under:—

“Prior to the enactment of the Rent Control legislation in our country, the relationship of landlord and tenant was governed by our common law viz. the Transfer of Property Act (Sections 107 to 111). The tenant was inducted with his tacit agreement to be regulated by the conditions embodied in the contract and could not be allowed to repudiate the agreement reached between him and the landlord during that period. The tenant was, therefore, bound in law to vacate the premises either voluntarily or through a suit after he was given a notice as required by the Transfer of Property Act under the terms and conditions of the lease However, as a piece of social reform in order to protect the tenants from capricious and frivolous eviction, the legislature stepped in and afforded in special protection to the tenant by conferring on him the status of a statutory tenant who could not be evicted except under the conditions specified and the procedure prescribed by the Rent Control Acts. Thus to this extent, the agreement of lease and the provisions of the Transfer of Property Act stood superseded. At the same time, the Rent Control Acts provided the facilities of eviction to the landlord on certain specified grounds like bona fide personal necessity or default in payment of rent etc. Thus any right that the tenant possessed after the exipry of the lease was conferred on him only by virtue of the Rent Control Act. It is, therefore, manifest that if the legislature considered in its wisdom to confer certain rights or facilities on the tenants, it could due to changed circumstances curtail, modify, alter or even take away such rights or the procedure enacted for the purpose of eviction and leave the tenants to seek their remedy under the common law.

Thus, we do not see how can the tenat challenge the validity of such a provision enacted by the legislature from which the tenant itself derived such rights.”

Again in P.J Irani v. State Of Madras & Another, AIR 1961 Supreme Court, 1731, the Supreme Court while considering the exclusion of certain buildings, upheld the validity of Section 13 of the Madras Buildings (Lease and Rent Control) Act (25 of 1949) which gives power to State Government to exempt class of building from the operation of the said Act but took the view that individual orders of the Government under said provisions could be subject to judicial review.

19. It will be noticed that by the Amending Act, the dendition of tenant for the purpose of heritability has been limited to premises let for residential purpose only. There is a general exception restricting heritability only for premises let for residential purpose. At the stage when this Ordinance and thereafter Amending Act came into force prevailing view of law Was enunciated by the Supreme Court in its two decisions reported as Anand Niwas Private Ltd. v. Anandji Kalyanji's Pedhi & others, AIR 1965 Supreme Court, 414 and J.C Chatterjee & others v. Shri Sri Kishan Tandon & another, AIR 1972 Supreme Court, 2526. In both the decisions the Supreme Court took the view that rights of a statutory tenant were not heritable and heirs of a statutory tenant were not entitled to the protection provided by the Rent Act. The statute considered in Anand Nivas Private's cases was the Bombay Rents, Hotel and Lodging House Rates Control Act (57 of 1947) and in the case of J.C Chatterjee (supra) it was the Rajasthan Premises (Control of Rent and Eviction) Act (17 of 1950) and the prevailing view was that heirs of statutory tenant had no protection under the Rent Act. It was in this prevailing view of the law that the Parliament stepped in so far as Delhi was concerned and as I have reproduced above the objects and reasons in the Amending Act and it was a persistent demand with a view to conferring a right to tenancy on certain heirs/successors of a deceased statutory tenant so that they may be protected from eviction by landlords, that the aforesaid clause 2(1) was introduced by the Amending Act.

20. The decision of the Supreme Court in the case of Damadi Lal (supra), where both the two decisions, namely, Anand Nivas Private Ltd. (supra) and J.C Chatterjee (supra) were reconsidered, was delivered only on 7th May, 1976. Before the Supreme Court in Damadi Lal's case, the question was whether heris of a statutory tenant could contince the second appeal before the High Court against the decision of lower appellate court against the statutory tenant and while deciding this question the Supreme Court emphasized that it will depend on the definition of the tenant as given in the statute, that is why the Supreme Court merely distinguished the earlier decisions in Anand Niwas and J.C Chatterjee's case and did not overrule them. It may be that the earlier definition of tenant in the Principal Act was such that it could cover both types of tenancy, namely, contractual tenancy and statutory tenancy but as observed by Fazal Ali, J. in Kewal Singh's case that, “it is, therefore, manifest that if the legislature considered in its wisdom to confer certain rights or facilities on the tenants, it could due to changed circumstances curtail, modify alter or even take away such rights ……”. It will be noticed that as of past in Delhi and in some other State's Acts, the landlord has no right when the premises are let for commercial purpose or non-residential purpose, to obtain an order of eviction of such premises on the ground of his bona fide personal requirement for residence or for any other purpose. The Legislature before it had the prevailing view of Supreme Court as enunciated in the cases of Anand Niwas and J.C Chatterjee and in its wisdom thought it fit to give rther rights to certain heirs of statutory tenant in certain circumstances or rather extend benefit of it to heris of statutory tenant where the premises were let for residential purpose but did not think it fit to give the same protection or extend benefit to the heris of tenants to whom premises were let for non-residential purpose. This classification is in accord with the general classification running in the Principal Act between the premises let for residential purpose and the premises not let for residential purpose.

21. In the case of Sh. Ram Krishna Dalmia & others v. Shri Justice S.R Tendolkar and others, AIR 1958 Supreme Court, 538, the Supreme Court determined the principles to be borne in mind by the Court for determining validity of statute on the ground of violation of Article 14 of the Constitution. In this case the Supreme Court held:—

“It is now well established that while article 14 forbids class legislation, it does not forbid reasonable classification for the purposes of legislation. In order, however, to pass the test of permissible classification two conditions must be fulfilled, namely (i) that the classification must be founded on an intelligible differentia which distinguishes persons or things that are grouped together from others left out of the group and (ii) that that differentia must have a rational relation to the object sought to be achieved by the statute in question. The classification may be founded on different bases, namely, geographical, or according to objects or occupations or the like. What is necessary is that there must be a nexus between the basis of classification and the object of the Act under consideration. It is also well established by the decisions of Supreme Court that article 14 condemns discrimination not only by a substantive law but also by a law of procedure. The decisions further establish.

(a) that a law may be constitutional even though it relates to a single individual if, on account of some special circumstances or reasons applicable to him and not applicable to others, that single individual may be treated as a class by himself;

(b) that there is always a presumption in favour of the constitutionality of an enactment and the burden is upon him who attacks it to show that there has been a clear transgression of the constitutional principles;

(c) that it must be presumed that the legislature understands and correctly appreciates the need of its own people, that its laws are directed to problems made manifest by experience and that its discriminations are based on adequate grounds;

(d) that the legislature is free to recognise degrees of harm and may confine its restrictions to those cases where the need is deemed to be the clearest;

(e) that in order to sustain the presumption of constitutionality the Court may take into consideration matters of common knowledge, matters of common report, the history of the times and may assume every state of facts which can be conceived existing at the time of legislation; and

(f) that while good faith and knowledge of the existing conditions on the part of a legislature are to be presumed, if there is nothing on the face of the law or the surrounding circumstance brought to the notice of the court on which the classification may reasonably be regarded as based, the presumption of constitutionality canont be carried to the extent of always holding that there must be some undisclosed and unknown reasons for subjecting certain individuals or corporations to hostile or discriminating legislation. The above principles will have to be constantly borne in mind by the Court when it is called upon to adjudge the constitutionality of any particular law attacked as discriminatory and violative of the equal protection of the laws.”

22. The distinction between residential and non-residential premises also occurs in clause 2(1) while defining a tenant. This is in accord with the general sheme running in that of a classification between two types of tenancy which has nexus with the Act, namely, to control eviction of tenants to the extent the Legislature considered it necessary.

23. There is another aspect of looking at the matter. In our view the petitioners have no IOGUS standi whatsoever to even challenge vires of Amending section 2(1). It will be noticed that general rights of the landlord and tenant are governed by Transfer of Property Act in Delhi. The Rent Control laws are a curb on the general rights of the landlord to evict a tenant after determining the tenancy or in accordance with the contract or lease. The restriction is on his right in relation to cases of premises. The tenants have no right to claim protection. The stature conferring the special right of tenant is to be implemented as a whole. For what would be the effect if this distinction between two types of premises vis-a-vis heritability is held to be discriminatory. The old clause 2(1) of the principal act has already been substituted. There is, in effect repeal of old section 2(1). It cannot revive. So the result would be that where as the definition of the landlord would be there but there will be no definition of tenant. Section 2 relating to definition in Principal Act contemplates that unless the context otherwise requires, the tenant means as so defined. All the provisions of the rent act are on their own force applicable between landlord and tenant so defined in that. If there is no definition tenant left, the whole act will ceased to apply to the tenants. There is, thus, inherent fallacy in considering that tenants have locus standi to challenge this provision as is being hit by Article 14 of the Constitution. Rent Arts are principally enacted for protecting the tenant and to the extent legilsature in its wisdom consider fit and proper to such heris as it may deem fit and proper. It is no right of tenant that for their future generation should also have the same protection. If Legislature in its wisdom consider it proper that they should have also protection, it will enact suitable restriction but merely because Legislature in its wisdom does not give further protection to the heirs of the tenant, it does not mean that the definition has no nexus with the act or object or purpose of the Act. As noticed earlier, the Act is merely controlling and not banning eviction for all times to come. We are clearly of the view that the differentia between residential and non-residential premises in its applicability to heritability of statutory tenancy is reasonable and it has nexus with the objects of the Act.

24. The alternative submission of learned counsel for the appellants was that if the whole section 2(1) as amended cannot be declared as ultra vires, a limited part of it be declared to be hit by Article 14 of the Constitution of India. The part so suggested is, “as had been ordinarily living in the premises”. This submission is merely being stated to be rejected. This provision is an integral part of the definition and not severable. By this part the heritability of tenancy called by what ever name whether statutory or contractual, is being limited to persons ordinarily living in the premises with the tenant upto the date of his death.

25. Before parting with this reference, some of the authorities on which learned counsel for the appellants relied for declaring section 2(1) as ultra vires may be noticed.

(1) S.K Datta, I.T.O v. Lawrenae Singh Inqty, AIR 1968 Supreme Court, 658.

(2) Jai Lal v. Delhi Administration, AIR 1962 Supreme Court, 1781.

(3) State of Rajasthan v. Mukan Chand, AIR 1964 Supreme Court, 1633.

(4) D.S Reddy v. Chancellor, Osmania University, 9967-2 SCR 214.

(5) Bashesher Nath v. CIT, Delhi and Rajasthan & another AIR 1959 Supreme Court, 149.

(6) The Deputy Commissioner and Collector, Kamrup and others v. Durganath Sharma, AIR 1968 Supreme Court, 394.

(7) Ganpat Lodha v. Shadhi Kant, AIR 1978 Supreme Court, 955.

(8) Anandji Haridash & Co. v. S.P Kasture etc. AIR 1968 Supreme Court, 565.

(9) The State of Andhra Pradesh v. Nalla Raja Reddy and others, AIR 1967 Supreme Court, 1458.

(10) Jaila Singh and another v. State of Rajasthtan & other AIR 1975 Supreme Court 1436.

(11) Harak Chand v. Union of India. AIR 1970 Supreme Court, 1453.

(12) A.P Krishnaswami Naidu etc. v. State of Madras, AIR 1964 Supreme Court, 1515.

(13) 1. Karimbil Kunhikonan (In Petition v. No. 114 Of 61), AIR 1962 Supreme Court, 723.

(14) Kasturi Lal Lakshmi Reddy v. The State of J. & K. AIR 1980 Supreme Court 1992.

(15) Ramana Dayaram Shetty v. The International Airport Authority of India etc. AIR 1979 Supreme Court 1628.

(16) Swami Motor Transports P. Ltd. etc. v. Sankaraswamigal Mutt, AIR 1963 Supreme Court 864.

In the case of S.K Datta, ITO (supra), the respondent was a Government servant in the State of Assam but was a member of Scheduled Tribe. Section 4(2) (xxi) of the Income Tax Act, 1922 in effect provided that the income of a member of a scheduled tribe shall not be included in total income “provided that such member is not in the service of Government”. Though the respondent was a member of Scheduled Tribe but in view of the exemption part of the aforesaid clause, he was denied the benefit. It was because of this that he had challenged part of the provision which sought to exclude the Government servants from the benefit of exemption. The Supreme Court held that the classification of Government servant for the purpose of the impugned section was arbitrary. Supreme Court took the view that there can be no distinction between the income of Government servant or of a person serving in a ‘private company, or Corporation or of a person from any profession. The Court further held that the impugned part was easily severable and there was no doubt that exemption would have been granted if the legislature was aware that it was beyond its competence to exclude Government servants from the exemption in question.

26. In the case of Jai Lal (supra) the provision which was challenged was Section 29 of the Indian Arms Act, 1878. This section provided for sanction for prosecution for an offence committed under Section 19(f) of the Act (possessing an arm without licence). Sanction was required in certain cases whereas on it was not required in other cases. The effect of the provision was that in made a distinction between the areas North of Ganga and Jumna areas and the other side of Ganga and Jumna. The Supreme Court took the view that this distinction between the areas of one side of Ganga and Jumna and the other side of Ganga and Jumna for the purpose of granting sanction was not based on reasonable classification. The Supreme Court made an important observation at page 1786, column 1, which reads as under:—

“The fact is that it is iherent in the very vice of discrimination that it is incapable of being broken up into what is good and what is bad. The gravamen of the charge that Article 14 had been contravoned is that it makes an irrational distinction among persons who are similarly circumstanced and where such a charge is well founded the section must in its entirety be struck down”.

27. This really supports the arguments urged on behalf of the respondent regarding severability as was contended for in the alternative.

28. The case of State of Rajasthan (supra) deal with the section 2(e) of Rajasthan Jagirdaras' Debt Reduction Act, 1957. This section was struck down by the Supreme Court in this case. The Act itself was passed for scaling down of debts of Jagirdars whose jagirs had been resumed earlier by the Rajasthan Land Reforms and Resumption of Jagirs Act, 1952. Section 2(e) defined the expression ‘debt’. The latter part of the definition excluded certain debts from the purview of the Act. It said “debt” means…..but does not include an advance made on after first day of January, 1949 or a debt due to the Central Government or Government of any State etc. etc, The Supreme Court held that the High Court was right in holding that the part of the section which excluded debts owed to certain authorities, was violative of Article 14 because no intelligible principle distinguished the exempted debts nor was there any rational nexus between the differentia and the object sought be achieved by the Act. The matter itself has arisen in execution proceedings in which the judgment debtor had applied for reduction of debts on the basis of the aforesaid provisions of the Act. The analogy of this case has no applicability here.

29. By one statute the property of a person was being resumed by the State and by another Act his debts were being called down but in the process of scaling down of his debts amount due to State Government and Central Government was sought to be excluded. This distinction was found by the Supreme Court to be bad for the purpose of scaling down.

30. The case of D.S Reddy (supra) arose out of the Osmania University Act, 1959. The appellant therein was appointed as Vice Chancellor for a particular term of five years. The term of office was by an amendment reduced to 3 years. Thereafter by the Osmania University (Second Amendment) Act, 1966. Section 13A was added to the Act. This provided that the Vice Chancellor holding that post at the commencement of the Osmania University (Second Amendment) Act, 1966 shall continue to hold office only until a new Vice Chancellor was appointed under section 12(1) and such appointment shall be made within 90 days after such commencement. The Supreme Court took the view that Section 13A was violative of Article 14 as it was directed against the appellant individually who could not be treated a class by himself.

31. It is difficult to understand the relevance of this authority as in the present case it is not individual tenant or their heirs who are being excluded from the certain class of premises from the protection of the Rent Act.

32. In the case of Basheshar Nath (supra) the appellant had entered into an agreement under the Taxation on Income (Investigation Commission) Act. 1947 and in pursuance of settlement, he agreed to pay certain amount as tax and penalty on his assessment. In the meanwhile the Supreme Court declared the Act as being violative of Article 14. As a consequence the settlement by the appellant also became void and the appellant disputed his liability to pay the outstanding amount. In the Supreme Court the counsel for revenue supported the validity of the settlement on the plea that the assessee had waived his right under Article 14 of the Constitution by paying a substantial amount in accordance with the settlement. The Supreme Court, however, held that it is not for a citizen or any other person who benefits by provisions of Article 14 of the Constitution to waive its breach on the part of the State. The appeal was therefore accepted and the proceedings against the assessee for recovery were quashed.

33. In the case of The Deputy Commissioner and Collector, Kamrup and others (supra) the land belonging to the respondent was sought to be acquired by the State of Assam under the Assam Acquisition of Land for Floor Control and Prevention of Erosion Act, 1955 read with Assam Act 21 of 1960. The respondent had challenged the validity of the Act on various grounds including the ground of discrimination under Article 14 of the Constitution. The High Court held the Act invalid and the Supreme Court upheld the decision of the High Court. The reason was that the impugned Act permitted land to be acquired for purposes of flood control on payment of nominal compensation while an adjoining land could be acquired for other public purposes under the Land Acquisition Act, 1894 only on payment of adequate compensation. The Court held that it was unjust discrimination between owners of land similarly situate by the mere accident of some land being required for purposes mentioned in the impugned Act and some land being required for other purposes.

34. The case of Ganpat Lodha (supra) is really irrelevant as this case relating to interpretation of Section 12(3)(b) of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947. However, at page 960 at the end of para 1, the Supreme Court observed as under:—

“If the statutory provisions do not go far enough to relieve the hardship of the tenant the remedy lies with the legislature.”

35. In the case of Anandji Haridas & Co. (supra) the appellant was a registered dealer under the CP and Berar Sales Tax Act, 1947. It failed to furnish returns for certain quarters. They were served with notices under section 11(4)(a) of the Act to show cause as to why they should not be assessed to the best of judgment by the assessing authority. section 11(4)(a) only applies to registered dealers. Section 11A(1) applies to both types of dealers registered or un-registered. Under the latter provision the limitation for commencing the proceeding was three years whereas there was no such provision of limitation under section 11(4)(a). contention of the assessee was that since they were proceeded under section 11(4)(a), they could not have the benefit of the limitation period of 3 years and on the facts found that section 11(4)(a) had become discriminatory. Hence, section 11(4)(a) was struck down. This case has no analogy with the facts of the case before us.

36. In the case of The State of Andhra Pradesh (supra) the respondents had filed petitions in the High Court for directing the State to for bear from collecting land revenue assessed under the provisions of the Andhra Pradesh Land Revenue (Additional Assessment) and Revision (Amendment) Act, 1962. The High Court accepted the petitions on the ground that the said Act was ultra vires Articles 14 and 19 of the Constitution. The State came in appeal. The previous settlement in the Andhra and Telengana done in 1863 was known as Ryotwari Settlement which was based on classification of soils. The land was classified into series, series into classes and classes into sorts. In case of wet soil some further classification was done. In short the land was divided into large number of classes keeping in view many and diverse factors.

37. The result was that the land revenue was a share of the produce of the land commuted into money value. In 1939 the Ryotwari system was abandoned. Two Acts were passed, one in 1952 and the other in 1956 to standardise the rates of assessment on basis of price level. In 1958, a Land Revenue Reforms Committee was appointed which recommended that the assessments should be made on basis of quality and productivity of soils, the duration of supply of water and the prices.

38. Under the impugned Act a completely new scheme was introduced. Irrespective of quality and productivity of soil a fixed minimum rate was laid down. In case of net land it was linked to the extent of the ayacut. After considering the various aspects the Supreme Court held the Act to be violative of Article 14 of the Constitution. This case is not relevant at all.

39. In the case of Jaila Singh and another (supra) there were two sets of Rules relating to allotment of Government Land which had been given on temporary lease to various persons. The Rajasthan Colonisation (Rajasthan Land Project Pre-1955 Temporary Tenants Government Land Allotment) Conditions, 1971 applied to residents of Rajasthan since before 1-4-1955 and who remained in possession of temporary cultivation land since before 16-10-1955 upto 3-2-1971. The Rajasthan Colonisation (Allotment of Government land to post 1955 Temporary Cultivation Lease holders and other Landless Persons in the Rajasthan Land Project Area) Rules, 1971 applied to post 16-10-1955 temporary lease holder. The conditions for allotment to the pre-1955 were much more beneficial than conditions for allotment to the post 1955 tenants. The court held the rules violative of Article 14. It held that the two groups were not separate classes and distinction between them was entirely arbitrary. The distinction was sought to be justified on two grounds i.e (i) The rajasthan tenancy act came into force on 15-10-1955 and (ii) the length of occupation. Both grounds were held to be without substance.

40. In the case of Harak Chand v. Union of India (supra) the impugned Act was the Gold (Control) Act, 1968. The sections which were challenged on the ground of Article 14 were Sections 27 and 39. Section 27 provided inter alia for licensing of dealers before any person could commence, or carry on, business as a dealer. Section 39 provided for licensing of certified goldsmiths. The argument was that provisions with regard to licensing of dealers were more harsh than in ease of registered goldsmiths. In discussing this argument the Court stated the dual test for examining the validity of a provision under Article 14 at page 1467 column 2. This test was relied upon by the appellants. The court however, held that licensed dealers and certified goldsmiths form separate classes and the classification made was reasonable. The impugned sections were therefore, not invalid because of this reason. However, the Court held Section 27 invalid under Article 19. The case does not appear to be helpful to the appellants.

41. The cases A.P Krishnaswmi Naidu etc. (supra) and K. Kunhikoman (supra) arose out of the Madras Land Reforms (Fixation of Ceiling on Land) Act, 1961 and the Kerala Agrarian Relations Act, 1961 respectively. In both the cases in the impugned Acts, an artificial definition was given to the expression “family” for the purposes of fixation of ceiling. Further both the Acts laid down a slab system for the payment of compensation for acquired land. The Supreme Court held that the Acts were unconstitutional being violative of Article 14.

42. These decisions are not at all relevant for purposes of the present case.

43. The cases of Kasturi Lal Lakshmi Reddy (supra) and Ramara Dayaram Shetty (supra) deal with the question of grant of largess by the Government by way of grant of contracts etc. vis-a-vis Article 14. Therefore, they are not relevant at all in considering the validity of a statute.

44. In the case of Swami Motor Transports P. Ltd etc (supra), the Madras City Tenants' Protection Act, 1921 was extended to the town of Tanjore by Madras Act 19 of 1955. As a result the protection provided by the Act became available to tenants there. This included protection provided to tenants of non-residential premises.

45. By Madras Act 13 of 1960, the Principal Act was again amended so as to withdraw the protection given to tenants of non-residential buildings in the town of Tanjore and some other towns. The protection continued in respect of city of Madras and other notified towns. Tenants of non-residential buildings of town of Tanjore challenged the Madras Act of 1960 on ground of Article 14 on the basis of two reasons, namely, (i) while the object of enacting the 1960 Act was for safeguarding tenants from eviction from residential buildings its provisions introduced a classification between non-residentiai buildings in different municipal areas and gave relief to tenants of non-residential buildings in some towns and refuse to give the same relief to similar tenants of such buildings in other towns in the State and such a classification had absolutely no relevance to the object sought to be achieved by the act; and (ii) the 1960 act made a distinction between non-residential buildings in Madras, Salem, Maduri, Coimbatore and Tiruchirappali on the one hand and those in other towns, including Tanjore, on the other and gave protection to the tenants of such buildings in the former group and denied the same to tenants of similar buildings in the latter group, though the alleged differences between the two sets of localities had no reasonable relation to the object sought to be achieved, namely, the protection of tenants who had built substantial structures from eviction.

46. The Supreme Court held:—

(1) That the provisions of the principal Act applied both to residential and non-residential buildings. So too the 1955 Act. Therefore, when in the “objects and reasons” attached to act 13 of 1960 the author of that Act stated that it was enacted with the main object of safeguarding the tenants from eviction from residential quarters, they were only emphasizing upon the main object but were not excluding the operation of that Act to non-residential buildings. So, it was not correct to state that the object of the Act was only to protect the tenants of residential buildings.

(2) that on the basis of the allegations made in the affidavit filed on behalf of the State of Madras, supported as it was by the statistical data furnished to the Court there were real difference between non-residential buildings in the towns of Madurai, Coimbatore, Salem and Tiruchirappalli and those in other towns of the Madras State which had reasonable nexus to the object sought to be achieved by the Act.”

47. We would, therefore, answer the first two questions as under:—

That there is a basic reasonable classification between the premises let for residential purpose and the premises “not let for” residential purposes running throughout the Rent Control Act, 1958 before its amendment and after its amendment and this classification is reasonable and in view of this classification there may be difference in their incidence and in their treatment. The distinction between the two types of premises may be in its applicability to heritability of statutory tenancy and that there is rational nexus between this classification and the purpose of the Act.

48. The third question is not necessary to be answered.

49. The aforesaid questions having been answered, the papers of the appeal be now placed before the Division Bench, in view of changed rules, for hearing.

B.N Kirpal, J—I concur with the reasoning and conclusions of my brothers Kapur)., and Dayal J.

D.K Kapnr. J.—I have had the advantage of reading the judgment of Dayal J. and I fully concur with the answers to the questions referred to the Full Bench which have been proposed by him.

51. The reference to the Full Bench is really the result, or consequence of the judgment of the Supreme Court in Damadilal and others v. parashram and others, A.I.R 1976, S.C 2229. However, the amendment in the definition of ‘tenant’ which was introduced by the Delhi Rent Control Amendment Act No. 18 of 1976, was apparently based on the previously existing view regarding the nature of protection given to a tenant under the Delhi Rent Control Act, 1958. At that time, the view was that a tenant whose tenancy had expired and who had been given a notice to quit had only a personal right under the Act which came to an end on his death. Such a tenant, whose tenancy had expired, but who was protected from eviction by the Delhi Rent Control Act, 1958, was considered to be a merely ‘statutory’ tenant with a personal right to continue in possession. It was thought that the rights of such a person came to an end on his death; the right not being inheritable, this raised a question of general public importance affecting the lives of the citizens of Delhi in the sense that the majority of the population are tenants whose occupation in their homes in protected only by the Delhi Rent Control Act. This would mean that in the majority of cases when the tenant dies, his heirs would have to leave hearth and home and seek some other premises because they no longer had the right to remain in occupation of the house they considered their home. To alleviate the distress which would be caused to such heirs, and also to combat the problem that would be caused by such displacement, the Legislature appears to have stepped in to extend the definition of ‘tenant’ to include certain heirs and dependents of a protected tenant, such as the spouse, son, daughter, parents, etc. This extension only applied to the persons who are actually living in the premises in question along with the deceased tenant, and only for their life times. It did not apply to the heirs of such additional persons.

52. It is not necessary for us to examine the effect of the judgment in Damadilal's case, as we are only concerned with certain constitutional questions which have led to the reference to this Full Bench. All the relevant cases have been referred to in the judgment of Dayal J. I do not, therefore propose to examine those judgments. According to learned counsel, for the tenants, we should strike down certain portions of the amendment so as to change the meaning of the provisions and make it applicable to both business premises as well as non-business premises. We think that this power of altering the Legislative enactment is not available to us. We can either strike down the provision or upheld it, or we can strike down some unconstitutional portion. We cannot amend the legislation to give a different meaning to the statute. We must, therefore, confine ourselves to the questions referred to us by the refering order.

53. The first question referred to us regarding the distinction between residential and non-residential premises is not to be found in the actual amendment made to the Act. It is the consequence of the wording used in the extended definition. The persons to whom protection was further given were only those persons who were actually living in the premises. If such persons happened to be living elsewhere, then they had not been given any protection. Therefore, principally, the definition applies only to such persons as would be left without a home and would have to seek other place to live, or live on the roads, unless protection was given to them. If one keeps in mind the object of the legislation, which is to protect a person from being rendered homeless, it becomes obvious that such an object cannot include a business place, a shop, a factory or premises used for other purposes. It can only extend to premises or houses used as homes as residences, and can only protect those persons who are actually residing in the premises at the time of the death of the original tenant.

54. If this point is kept in view, it becomes obvious that the classification is based on intelligible criteria. The protection is limited to persons actually living in the premises. There is, therefore, a distinct and clear classification. Obviously, there is also reasonableness in the classification. A person is not rendered homeless if a shop belonging to his father is taken away by the landlord, then he has to fend for himself and find another abode, if that is possible, in an over-crowded city.

55. Much was at the hearing of the fact that business premises were as important as homes and the object of the Act was to protect business premises also. However, one has only to recall that if business premises are also inheritable in perpetuity by tenants and their successors without any words of restriction, then a monopoly succession or ownership rights will be created in favour of such persons, as might happen to be tenants. The object of the Act is to protect tenants and to control rents. The number of business premises is limited. If business premises are to be inherited even by the successors of tenants, then a perpetual line of succession to such business premises would be created, making it impossible for others to ever get shops or factories or other premises where they can carry on business. There is, therefore, a very clear line of demarcation between business premises and homes, houses, flats or rooms in houses used by millions of Delhi citizens for purposes of sleep and residence which are protected qua the tenant's heirs by the amendment. Very few of these persons may be shopkeepers and indeed, very few of them will be factory owners or cinema owners and such like. The purpose of such legislation, i.e, the Rent Control Legislation is to protect the poorer classes who will otherwise be rendered homeless and face the possibility of not being able to get any other place for inhabitation. On the one hand, they would find that their provider in the sense of the tenant being the earning member of the family would be lost, on the other hand, they, the widow and the children, and may be, the old parents would find that they had no place to go to. On the other hand, in the case of shops and shop-keepers, one can safely assume they are economically bitter off and a son of a shop-keeper need not be a shop-keeper, nor indeed the widow and the minor children may Rave anything to do with the business. They may be following a completely different occupation. On the other hand, wanting a home and a roof above their heads and a place to keep their belongings is a universal demand which every human being has to satisfy. Therefore, the distinction between residential and nonresidential buildings is not the material line of demarcation in the present case, but the dividing line or line of classification between the two classes is that of being rendered homeless or not being rendered homeless.

56. It would not be out of place here to mention some essential facts regarding the Rent Control legislation. Such legislation was practically not existent till the Second World War. It was introduced as an emergency legistlation in different parts of the world as a result of circumstances creating an increasing demand for homes and also necessitated by the spiralling rents all over the world, caused, firstly by the World War and following it by the inflationary trends in the world economy. It became fairly obvious that the weaker sections of Society had to be protected both against the rising rents and also threat of eviction. The result of the legislation has not been an out-right success. While protecting tenants, it has also created an artificial scarcity of available houses. Landlords do not so easily give houses on re it because it is difficult to displace the tenants. The tenants do not leave the premises because they cannot find other premises. Increasing population and; rising cost of construction have decreased the number of new houses and the problem of housing the population has tended to become more serious rather than to ease. In many countries, including England, the rent control legislation is limited to residential houses and does not apply to business premises. In different portions of India, the Rent Control Acts of the States make different provisions regarding residence and non-residential premises. In the case of some States, laws have been made to enable even business premises being occupied by the landlords for their own use. The incidence of the laws differ in different parts. The grounds of eviction are different. However, there is no doubt that the housing problem has not been solved in any part of the country and nor has it been solved outside India to any marked extent. The result of the legislation regarding the number of available houses also has an inflationary effect on rents generally, because new houses can be let out at very high rents due to paucity of available accommodation. All this comment is necessary only with a view to demonstrating that the effect of leaving out business premises from the extended definition of tenat means that the Legislature has allowed a certain proportion of the premises to remain vacant on the death of the tenant. These premises may be both residential and non-residential. For instance, if there is a tenant whose heirs do not live with him, or who do not desire to continue, then those premises will also become vacant. Similarly, business premises will become vacant. This is bound to be to the public good, because in the event of some houses becoming available the rents are likely to fall and more persons can be accommodated. Also, old buildings can be re-built or expanded and so on.

57. It may also be observed that the extended definition of tenant which includes those heirs who are actually living in the premises with the deceased tenant succeed only to a limited extent because they only have a personal right which is not to devolve on any of his or her heirs. This is so provided in Explanation III to the extended definition. Thus, eventually even these premises will go back to the landlord and will be available to the general public.

58. Keeping in view all these factors, I have no doubt that the answers proposed by my learned brother Dayal J; are correct and I agree with the same.

59. In the result, we uphold the constitutional validity of the amendment to the definition of ‘tenant’ contained in Section 2(1) of the Delhi Rent Control Act, 1958. The directions contained in the judgment of Dayal J; regarding the further hearing of this appeal and the connected appeal will now apply to these two appeals.