1. This is an unusual litigation. Perhaps, a forerunner of many of its kind; and indicative of a welcome trend. It is unnecessary to have a detailed account of the factual allegations in the case. The plaintiff was pushed out at the threshold; on the ground that two sections-Ss. 89 and 138 of the Kerala Housing Board Act, 1978 (hereinafter referred to as ‘the Act’) barred such suits. Some skeletal facts are, however, necessary even to evaluate the legal contentions and for evolving the course to be adopted by courts in litigations of this type.
2. The plaintiff was an allottee of a parcel of land in a housing scheme in the State's capital. He has constructed a house in the plot and has occupied it. The Housing Board, it is alleged, acquired the land paying the owner thereof price at the rate of Rs. 700 per cent. It demanded as price of land only about Rs. 1,500 per cent from many of the allottees; even when such plots enjoyed better facilities and advantages. In the case of the plaintiff, the rate fixed initially was Rs. 3,450 per cent; that was later reduced to Rs. 2,500. Little justification exists, according to him, to demand from him such a high figure when the Housing Board itself has fixed the value of better plots at about Rs. 1,500/-. The action of the Board is characterised as arbitrary and its monetary claim as highly excessive. A demand was made by the plaintiff on 8-8-1972 to the Housing Board to finalise the price of land on a just and equitable basis, and according an equal treatment. As it quite often happens with institutions like the Housing Board, little attention was paid to such a representation Nearly six months later, the plaintiff was called upon by the Board to execute a final hire-purchase agreement-This was accompanied by a threat of cancellation of allotement in default of compliance with the request of the Board. The plaintiff then thought of legal action. A lawyer's notice was caused to be sent to the Board on 14-3-1973. The Board's reply on 19-5-1973, according to the plaintiff, did not disclose a proper or fair attitude. The parties reiterated their respective stand in their letters dated 7-6-1973 (of the plaintiff) and 18-6-1973 (of the Board). The suit was thereupon filed for a declaration that the plaintiff was entitled to get the price of his plot “finally fixed on a par with the price fixed for the remaining plots…… not exceeding Rs. 1,500 per cent”. An injunction restraining the defendants from taking any penal proceedings till such finalisation of the price, was also moved.
3. In the written statement, the right of the Board under S. 85 of the Act to evict an allottee in case of his contravening the terms under which he was allowed to occupy premises was asserted. The bar under S. 89 was projected as an objection to the very maintainability of the suit. According to the Board, the plaintiff had executed a preliminary agreement on 15-12-1969 agreeing, among other things, to take on hire-purchase the building when completed, to execute hire-purchase agreement as prescribed by the Board and agreeing to a value of Rs. 2,500 per cent for the land. It was contended that the plaintiff thereupon was disentitled to institute the suit. The Board also pointed out that the representations made by the plaintiff had been duly considered by it but that the Board did not feel any necessity for a reconsideration of its earlier stand. The right of the Board to direct the plaintiff to execute final hire-purchase agreement in terms of the preliminary agreement was asserted.
4. The trial court upheld the plea of the defendants about the bar to the suit based on S. 89 of the Act. This view found acceptance with the appellate court. According to it there was an additional bar to the suit. Ext. B1 agreement was an action of the Board taken in ‘good faith’ and consequently S. 138 foreclosed access for the plaintiff to the court of law. The rejection by the trial court of the contention on merits was also upheld by the appellate court.
5. The plaintiff has come up in second appeal canvassing the correctness of the decisions of the courts below.
6. The question relating to the very maintainability of the suit shall be considered first.
7. A brief background of the enactment may usefully be referred to, before the relevant sections are considered. The preamble to the Act proclaims the idea behind the enactment as “to provide for the organised direction and planning in the preparation and execution of housing and improvement schemes and for the establishment of a State Housing Board in the State of Kerala” The statement of objects and reasons which accompanied the Bill set out the reasons for the enactment. Paragraphs 1 and 2 thereof read:
“Organised and planned development of building activities particularly of residential accommodation has been lacking in this State. Construction of residential accomodation has been spread over the entire State with various Governmental and non-governmental agencies executing house building schemes without any co-ordination or study of the needs of the area. The agencies have also not been able to function effectively due to their inability to obtain funds at the proper time.
The idea of setting up a Statutory Housing Board for the State has been engaging the attention of the Government from a very long time.”
8. There was reference therein to the provisions obtaining under the enactments like the Trivandrum City Improvement Trust Act, 1960, the Town Panning Act, 1108, and the Madras Town Planning Act, 1920, relating to the framing and execution of housing schemes. The Government felt that those provisions were inadequate to meet the requirements.
9. The provisions of the Act are dispersed in sixteen chapters-Chapter II deals with the constitution of the Board and Chapter V with the conduct of its business. The powers of the Board and the Chairman are delineated in Chapter VI. Chapter VII is a fairly long Chapter dealing with housing or improvement schemes, under Ss. 36 to 79. The sections with which we are concerned, occur in Chapter XI. The heading of the chapter is: “Power to evict persons from Board premises”. Thereunder, if the competent authority is satisfied that a person authorised to occupy the Board's premises has acted in contravention of any of the terms under which he is authorised to occupy such premises, he will be liable to be evicted in accordance with the detailed provisions contained therein. S. 86 deals with the power of the Board to recover rent or damages as arrears of public revenue due on land. An appeal is provided from the orders passed under S. 85 or 86. The forum to which the appeal lies and the manner in which the appeal is to be presented, have been indicated in S. 87. There is an enabling provision—S. 88—for recovery of rent from deduction from salary or wages in certain cases. It is after these provisions, that S. 89 is placed. It reads:
“Bar of jurisdiction of courts: No order made by the Government or the competent authority in the exercise of any power conferred by or under this Chapter shall be called in question in any court and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Chapter.”
(emphasis supplied)
10. It will be noticed that before an order is passed under S. 85(2) of the Act, the competent authority is obliged to give a reasonable notice of the proposal for such an order to the person concerned; and a reasonable opportunity shall be afforded to him to put forward his contentions before the order is passed. An order is contemplated under S. 86(2) for the payment of damages by a person in unauthorised occupation. That order too has to be preceded by a notice in that behalf and an opportunity to put forward objections Admittedly, no such order has been passed as envisaged under, or in exercise of the powers conferred by S. 85 or 86. S. 89, it must be noticed, is not a general bar on approaching the court for any relief. The bar thereunder is confined to challenges against an order made by the Government or the competent authority in the exercise of any power conferred by or under this Chapter”. In as much as no order has been passed against the plaintiff under the aforesaid sections, the bar under S. 89 is not attracted.
11. It may also be noted in this connection that even if any particular cause of action or relief is barred in a suit, that will not denude the civil court of its jurisdiction when the primary claim is within its competence. This proposition is too well-established to require a detailed discussion. The question was considered in Rajah Nilmoni Singh v. Unnodaprasad Mookerjee, 1 Beng. L.R 93 (F.B), in the context of certain claims before the civil court being exclusively triable by the Revenue Court. Sir Barnes Peacock, C.J speaking for the Full Bench observed:
“It appears to us that the civil Court had the power to try this question when it was mixed up with the other questions in the suit……… It would be most inconvenient in the present case if the whole question could not be tried by the civil Court.”
12. The view has been shared in other jurisdictions too. (vide Sukhdeo v. Basdeo, AIR. 1935 Allahabad 594, Baleswar Ram v. Governor, Bengal Province, AIR. 1949 Calcutta 321, and Narayanaswami v. Vasudeva, AIR. 1958 Madras 360).
13. Even assuming that there is a bar under S. 89, the court will have jurisdiction to entertain and try the suit when the dominant claim (such as the declaration sought for) is unaffected by the bar.
14. The findings of the courts below on this question are, therefore, vitiated by an error of law. They are, therefore, necessarily to be vacated. I do so.
15. The appellate court committed yet another error in holding that S. 138 also operated as a bar to the suit. S. 138 reads as follows:—
“Protection of action taken in good faith: No suit, prosecution or other legal proceeding shall lie against the Government, the Board or any committee thereof or any officer or servant or the Government or any officer or sub-ordinate of the Board for anything which is in good faith done or intended to be done in pursuance of this Act or any rule or regulation made thereunder.”
16. That section has to be read along with S. 139, a reference to which is necessary, having regard to the effect and impact which that section has, on the interpretation of S. 138:
“Notice of suit against Board etc.: No suit shall be instituted against the Board, or any member, or any officer or sub-ordinate of the Board, or any person acting under the direction of the Board or of Chairman or of any officer or sub-ordinate of the Board in respect of any act done or intended to be done under this Act or any rule or regulation made thereunder, until the expiration of sixty days next after written notice has been delivered or left at the Board's office or the place of abode of such member, officer, sub-ordinate or person stating the cause of action, the name and place of abode of the intending plaintiff and the relief which he claims, and the plaint must contain a statement that such notice has been so delivered or left.”
17. Similar provisions obtain in large number of fiscal and other enactments. Such provisions have received judicial interpretation from early times. It is sufficient to hold that the provisions do not constitute a bar to the institution of a suit seeking a declaration as claimed by the plaintiff in the case. (See Ram Swarup v. Shikar Chand, AIR. 1966 SC. 893, Dhulabhai v. State of M.P, AIR. 1969 SC. 78, and other cases).
18. The view taken by the courts below that the suit itself is barred is, therefore, unsustainable and has to be set aside.
19. As noted earlier, the courts below have expressed themselves against the plaintiff on the merits of the claim. According to them, in view of Ext. B1 agreement the plaintiff is not entitled to have the value of the land refixed. This conclusion has been rested essentially on the principle that the plaintiff having been a party to the bargain, cannot resile from it. I am of the view that the issue has not been considered in the proper setting and perspective by the courts below. The Board which is a statutory functionary is an authority under Article 12 of the Constitution of India. Its functioning is modulated by the fundamental principles which insist on a fair and reasonable approach. That is necessitated under Article 14 of the Constitution, which the Board has to conform to. The principles of fair play and reasonableness have to guide the action of the Board even dehors Article 14. This obligation binds alike all State authorities whether it be an Air Port Authority or a Housing Board a Nationalised Bank or a Civil Supplies Corporation. No authority should have any doubt on these fundamental obligations, after the decisions of the Supreme Court in International Air Port Authority's case (1979) 3 SCC 489 : AIR. 1979 SC. 1628 and Ajay Hasiah's case (1981) 1 SCC 722 : AIR. 1981 SC. 487.
20. Even in countries without written Constitution, the insistence on the part of such Housing Authorities to act fairly and reasonably, is well-esablished. A legislation of this character had its origin in England about 100 years back. Students of law (and those interested in a proper administration of the Housing Board) would do well to note the developments in cognate legislation from 1890 onwards, when the Housing of Working Classes Act, 1890 was passed. Denning, J. had difficulty as regards the question: “Who does and who does not belong to the working classes?”. (See Green & Sons v. Minister of Health, (1947) 2 All ER. 469). So too had Romer, Lord Justice. And he said: “It does not appear, to me that this description is the prerogative now-a-days of any particular section of the British people. (Sartorial expertise and textile excellence pose similar problems elsewhere too) see Belcher v. Reading Corpn., (1949) 2 All ER 969 at p. 984. The term ‘working classes’ was therefore jettisoned from the title to the enactment. The development of the law and the specialisation therein is reflected by the ‘Housing Law Reports’ published in that country.
21. Many may think that the allottees are favoured persons who live in the charmed circle of the particular scheme. They may, however, have disputes, bona fide disputes, with the Board on many matters connected with the interpretation and implementation of the scheme. No doubt, the management and control of the houses and lands do vest in the Housing Board, to whom the legislature entrusted it and not in the courts. That does not, however, detract from the fundamental character of such a Board. Lord Atkinson's speech in Roberts v. Hopwood, (1925) AC. 578, contains an extract of a passage which, in a sense, neatly sums up the nature and duties of such authorities. The extract reads:
“A body charged with the administration for definite purposes of funds contributed in whole or in part by persons other than the members of that body, owes……a duty to those latter persons to conduct that administration in a fairly businesslike manner with reasonable care, skill and caution, and with a due and alert regard to the interest of those contributors who are not members of the body. Towards these latter persons the body stands somewhat in the position of trustees or managers of the property of others.”
22. Summerfield v. Hampstead Borough Council, (1957) 1 All ER. 221, was decided later. Harman, J. observed in that case at p. 226:
“The needy must be succored, wants must be supplied, charges must not be unreasonable……”
Dankwerte, J. pointed out the place of a court of law in the setting of the actions of a Housing Authority in the following words in Smith v. Cardiff Corporation, (1955) 1 All ER. 113 at p. 122:
“It is right and proper that their management of their housing estates should be capable of being challenged in a court of law.”
23. The legislation in the United Kingdom, as a matter of fact, would indicate large areas in which the court is expressly empowered to undertake enquiries and render decisions. (See Halsbury's Laws of England, Fourth Edition, Volume 22, page 249) A comparison between the Act in question and the provisions of the English legislation, for obvious reasons, may be odious. The fact, however, remains that the basic character of the housing authority would profitably be appreciated in the historic background of the advanced legislation and case-law in that country. A duty on the part of the authority to act reasonably and fairly, and its accountability to a court of law when the jurisdiction of the court is invoked by an aggrieved party appear to be fairly implicit. The suit will have to be tried and disposed of by the court below bearing in mind the above broad features and considerations. An execution of an agreement of the type of Ext. BI would not disentitle an allottee, like the plaintiff, to a fair treatment from the Board. Whether the plaintiff has been dealt with inequitably, with evil eye or an unequal hand, would no doubt depend upon the evidence available before the court. The parties would have to adduce evidence in substantiation of their respective contentions. The court will then evaluate the evidence and enter its findings thereupon. For such a fresh decision, the case will now go back to the trial court.
24. Mr. K. Sudhakaran, Senior Advocate who appeared on behalf of the appellant, pointed out that the plaintiff, a Member of Parliament belonging to the Communist Party of India, and close to those who wielded the administration at the time, felt that he would fight out the issue in a court of law, as a matter of principle, even though the monetary relief is a small one. I appreciate the stand, which as I said in the beginning of the judgment, heralds a welcome trend. In his note written on 31-10-1905 V.I Lenin reacted sharply towards ‘the bourgeois judges’, ‘judges who brings to the bourgeoisie’, for their having rendered the decision in the Taff-Vale Railway case. (See V.I Lenin ‘On Britain’, Second Impression, Moscow, page 46.) The trust the followers of Lenin now have in courts is a matter of assessment of the historians of legal institutions.
25. The suit has been pending for nearly a decade now. Having resolved to fight a suit for the vindication of a principle the plaintiff must be alert and vigilant in the prosecution of the same. There has been some laches on his part earlier. He should take care that such lapses do not recur. The second appeal is accordingly allowed and the judgments and decrees of the courts below are set aside. The trial court will dispose of the suit as expeditiously as possible after affording both parties sufficient and reasonable opportunity to adduce their evidence. The parties will suffer their respective costs.
26. Allowed.