M.L. Bagga vs C. Murhar Rao

This is an application in revision on behalf of M.L. Bagga challenging the propriety of the order dated 15-4-1955 by which the Chief Judge, Small Cause Court, Hyderabad upheld on appeal the order of eviction passed by the Rent Controller.

The question for our consideration is whether the Petitioner is entitled to two years'' immunity from eviction as provided by the amended Sub-rule (3) of Rule 11(E), Evacuee Interest (Separation) Rules, 1951 published in the Gazette of India dated 19-3-1955.

To appreciate the contention raised on behalf of the Petitioner, it would be appropriate to narrate certain relevant facts at the outset. The premises bearing Municipal No. F. 4.841 situate at Red Hills, Nampally, Hyderabad came into possession of the Custodian, evacuee Property as a composite property within the meaning of that expression as defined in Clause (d) of Section 2, Evacuee Interest (Separation Act (Act 64 of 1951), hereinafter referred to as the Act. The custodian inducted the Petitioner into the house in dispute as a tenant on a monthly rental of O.S. Rs. 115/-.

The competent Officer in the exercise or his powers conferred by Section 10(a)(iii) of the Act sold the aforementioned premises by public auction according to the procedure laid down in the Interest Separation Rules. The non-applicant, Murahari Rao, being the highest bidder for Rs. 31,000/-, the property was knocked down in his name and he was declared to have purchased the property.

As a result of the sale, the competent Officer through his letter F. No. 79/55/Ev. dated 10-2- 1954 asked the Custodian to direct the Petitioner to pay the rent accruing due from 1-2-1954 to the purchaser.

On 10-1-1955, Murahari Rao moved the Rent Controller for an order of eviction on the ground that the tenant i.e., the Petitioner had defaulted in regular payment of the rent and that he himself being posted as Chief City Magistrate at Hyderabad and occupying a tenanted house, required the disputed premises for his personal accommodation.

The defence put forward by the Petitioner in reply consisted of the plea that he was not a defaulter and that he being a displaced person was protected from eviction by force of Section 29, Displaced Persons (Compensation and Rehabilitation) Act. He also pleaded that the application for eviction was barred in view of Section 36 of the same Act.

On these pleadings apart from the issues of law, a question as to the Petitioner being n defaulter also arose. The Rent Controller fixed 11-3-1955 for evidence. But in view of the non-applicant''s application of 15-2-1955 that the case could be decided on legal issues, he called upon the Petitioner to address his arguments of law.

After hearing the Petitioner''s advocate, the Rent Controller repelled the legal pleas and having regard to the fact that the intention of the non-applicant was to stay in the house in dispute as a result of his transfer to Hyderabad, made an order for eviction giving the Petitioner time to vacate the premises before 12-4-1955.

The Petitioner took the matter in appeal but the learned appellate Judge did not find himself in a position to accede to the Petitioner''s contention because of the absence of any notification under Sub-section (2) of Section 29, Displaced Persons (Compensation and Rehabilitation) Act, 1954 and dismissed the appeal.

It is against this appellate order the present revision petition is directed. The learned Advocate for the Petitioner completely abandoned before us the stand which he had taken in the Courts below, under Sections 29 and 36, Displaced Persons (Compensation and Rehabilitation) Act. He however, argued that the amendment effected in Sub-rule (3) of Rule 11E, Evacuee Interest (Separation) Rules, 1951 was intended to be retrospective and therefore the order for eviction should be held to be bad in law.

In this connection, reliance was placed on - Rustomji Dossabhai Billimoria Vs. Bai Moti, (A); - Dila Ram and Others Vs. Atma Ram and Others, (FB) (B); - Raja Ram Vs. Madho Prasad, (C); - Jagannath Vs. Board of Revenue, U.P., Allahabad and Others, (D); - ''Mohammed Asghar v. Gulsher AIR 1949 Lah 14 (FB) (E); - Sant Kuer and Another Vs. Ganesh Choudhary, (F); - ''The Queen v. Vine (1375) 10 QB 195 (G); - Pardo v. Bingham (1868) 4 Ch A 735 (H); - ''Barber v. Pigden (1937) 1 KB 664 (I); - ''Rex v. Oliver'' 1944 KB 68 (J) and finally Maxwell on Interpretation of Statutes, 10th Edn., p. 214.

On the other hand, the learned advocate for the opposite party strenuously contended that the rights and liabilities of the parties would be governed by the law as it stood when the non-applicant presented his application for the eviction of the Petitioner. It would be, he said, against all canons of interpretation to give retrospective operation to the amendment relied upon on behalf of M.L. Bagga for the simple reason that subsequent change would not prejudicially affect vested rights or legality of the past transactions.

In regard to English authorities cited on behalf of the Petitioner, he urged that they could not be said to have even persuasive force inasmuch as they run counter to the provisions of Article 20, Constitution of India. With respect to Indian authorities he submitted that they were distinguishable on facts and law obtaining in those cases.

He further contended that the amendment pressed into service was ultra vires of the rulemaking power of the Central Government. In the last resort, his argument was that the Petitioner cannot take advantage of the change in law since there was no proof on the record that he was a displaced person within the meaning of Clause (b) of Section 2, Displaced Persons (Compensation and Rehabilitation) Act, 1954 for whose benefit the immunity from eviction for a period of two years from the date of sale has been provided by the amendment of the said rule.

To fortify himself in his submission he referred us to - ''Narayan Pershad v. State of Hyderabad AIR 1955 Hyd 82 (K); - Huzrat Syed Shah Mustarshid Ali Al Quadari Vs. Commr. of Wakfs and Others, (L) and - Pramod C. Bhat Vs. Kanwar Raj Nath, (M).

For a full appreciation of these submissions it falls in limine to be stated that in the year 1951, the Central Government, being of the view that it was expedient to make special provisions for the separation of the interests of evacuees from those of other persons in the property in which such other persons are also interested and for matters connected therewith, passed the Evacuee Interest Separation Act being Act 64 of 1951.

Such properties were denominated "composite property" and defined in Clause (d) of Section 2 of the Act and in Clause (c) "competent officer" was said to mean an officer appointed as such by the State Government u/s 4. The process of separation of the interest of the evacuee from those of claimants in composite property was non obstante aliauo statuto in contrarium provided for in Section 10.

In Clause (a)(iii) of that section, the competent officer was authorised to sell the property and distribute the sale proceeds between the custodian and the claimant in proportion to the share of the evacuee and of the claimant in the property. Section 23 conferred power on the Central Government to make rules to carry out the purpose of the Act. In exercise of that power, the Central Government framed rules and published it under the denomination of Evacuee Interest (Separation) Rules and published it in the Gazette of India, 1952 Part II, Section 3 (p. 109).

Rule 11D provided an elaborate procedure substantially on the lines of the provisions contained in the CPC for sale of composite property. In order to meet the exigency in case of the property being in possession of a third person it was originally provided by Sub-rule (3) of Rule 11E:

Where the properly sold or transferred on partition on or otherwise is in the occupancy of a tenant, allottee or other person entitled to occupy the same, the competent officer, shall, on the application of the purchaser or transferee, order delivery to be made by affixing a copy of the certificate of sale or order of transfer in some conspicuous place of the property or by publication thereof in a newspaper having circulation in the locality and the expenses incurred in this connection shall be paid by the applicant.

In the year 1954, the Displaced Persons (Compensation and Rehabilitation) Act (Act 44 of 1954) came into force defining displaced person to mean:

Any person, who, on account of the setting up of the Dominions of India and Pakistan, or on account of civil disturbances or the fear of such disturbances in any area now forming part of West Pakistan, has, after the first day of March 1947, left, or been displaced from, his place of residence in such area and who has been subsequently residing in India and includes any person who is resident in any place now forming part of India and who for that reason is unable or has been rendered unable to manage, supervise or control any Immovable property belonging to him in West Pakistan and also includes the successor-in-interest of any such person.

As the symbolical possession which could only be given to the purchaser under Sub-rule (3) of Rule 11E did not guarantee against subsequent eviction or ejectment of the tenant under the Hyderabad Houses (Rent, Eviction and Lease) Act, 1954 or any other law for the time being in force and there was a possibility of a displaced person being thrown out on the street, the Central Government by a notification published in the Gazette of India dated 19-3-1955 substantially retained the existing rule making it Clause (a) of new sub-rule and added Clause (b) which runs as follows:

(b) Notwithstanding anything contained in these rules or in any other law for the time being in force, a displaced person, within the meaning of Clause (b) of Section 2, Displaced Persons (Compensation and Rehabilitation) Act, 1954 (44 of 1954) who may be in authorised occupation of any composite property shall not be liable to be evicted by any purchaser or transferee thereof for a period of two years from the date of sale or transfer, as the case may be, except on any of the following grounds namely:

(i) that he has neither paid nor tendered the whole amount of arrears of rent due after the date of sale or transfer within one month of the date on which a notice of demand has been served on him by the purchaser or transferee in the manner provided in Section 106, Transfer of Property Act, 1882 (IV of 1882).

(ii) that he has without obtaining the consent of the purchaser or transferee in writing-

(a) sub-let or surrendered the possession of the whole or any part of the property, or.

(b) used the property for a purpose other than the purpose for which he was using it immediately before the sale or transfer;

(iii) that he has committed any act which is destructive or permanently injurious to the property.

This amendment, as already stated came into force on 19-3-1955. By that time, the Rent Controller had already given his decision but it had not become final since an appeal was permissible u/s 20, Hyderabad House (Rent, Eviction and Lease) Act, and a revision against the appellate order lay to the High Court u/s 21 of the said Act. The Petitioner''s appeal was filed in the lower appellate Court on 7-4-1955 and there it was therefore open to him to have sought the protection given by the amended rule on the plea of retrospectivity.

But we are informed by the learned advocate for the Petitioner that during the short pendency of the appeal, he had not been able to get hold of the Gazette in which the amendment was notified. Be that as it may, we allowed the question to be argued before us, as in our opinion, it was covered by the provisions of Section 21 of the said State Act.

We would first take up the contention as to the vires of the Central Government in framing Sub-rule 3(b) of Rule 11E. Section 23 of the Act conferred powers upon the Central Government to make rules to carry out the purposes of the, Act. The purpose or purposes of the Act may be gathered from the preamble. The preamble inter alia states that it is expedient to make special provisions for the separation of the interests of evacuees from those of other persons in the property in which such other persons are also interested and for matters connected therewith.

Now one of the authorised modes of separation of the interests by the competent officer was by way of sale. The sale in its trial, creates ancillary and incidental questions which are well known and need not be enumerated. It was open to the framers of the Act to have mutatis mutandis applied the provisions of the CPC in this behalf but they preferred to lay down the procedure through the machinery of the rules as it fell within the expression "matters connected therewith" used in the preamble.

The right to possession was dealt with in Rule 11E and it was provided that in case the property sold was in the occupation of a tenant, the purchaser would have to remain content with symbolical possession. The rule as it originally stood was not assailed as being ultra vires the rule-making powers. What formed the core of attack on behalf of the non-applicant was the continuation of the purchaser''s symbolical possession for a period of two years from the date of sale so as to give immunity from eviction to a displaced person if he happens to be a tenant in the property sold.

It was contended that the immunity thus given was beyond the purposes of the Act which was concerned only with the separation of the interest of evacuee and the matters connected therewith. In our opinion, if the first portion of the impugned rule providing for the delivery of symbolical possession to the purchaser was not beyond the rule-making power of the Central Government and fell within the expression "matters connected therewith" how the superimposition of a period of time for the continuance of symbolical possession in a particular contingency would take the rule out of the ambit of Section 23, read with the preamble.

The impugned Sub-rule, according to us being operative, the other important question to be determined is whether it can be given a retrospective effect. It may be recalled that the sub-rule though framed on 28-2-1955 was notified in the Official Gazette of 19-3-1955 by which time the Rent Controller had delivered his decision and the Petitioner had not as yet filed his appeal.

In so far as the Act or Statute passed by a Legislature is concerned, the rule of construction appears to be that in order to determine whether an Act is retrospective in its operation, the provision of the Act itself must be adverted to bearing in mind that a Statute is not to be construed retrospectively unless it is clear that such was the intention of the Legislature.

To ascertain the intention, regard should be had to the general scope and purview of the enactment, to the remedy sought to be applied, to the former state of the law and to what was in the contemplation of the Legislature. Unless there be something in the language, context or object of an Act showing a contrary intention the duty and practice of Courts of justice is to presume that the Legislature enacts prospectively and not retrospectively.

On the other hand, if there are words in the enactment which either expressly or by necessary intendment (e.g. from the object of the statute) imply that the statute is to be given retrospective operation even in respect of substantive right or pending action, the Courts have no other alternative than to give such operation to the Statute even though the consequences may appear to be unjust or hard.

The principle that parties are governed by the law in force on the date when a suit is instituted or a proceeding commenced and any subsequent amendment or alteration cannot affect pending proceedings, must always be read subject to the corollary that a Legislature could always expressly provide that pending proceeding be affected by an amendment of the law.

If the Legislature retrospectively affects pending proceedings, then it would be the duty of the Court of appeal and for the matter of that of a Court of revision to apply the law prevailing on the date of the appeal or revision pending before the Court; the mere passing of the decree does not preclude from taking into consideration the change in the law effected after the passing of the decree.

There is abundant authority for the proposition that an appellate Court is entitled to take into consideration facts and events which have come into existence since the order under appeal was passed.

This is more or less the ratio decidendi of the authorities cited on behalf of the parties. But none of these cases touches the question whether a rule-making authority in the absence of any express power in that behalf in the parent enactment can frame rules with a retrospective operation.

Within the frame-work of Article 246 of the Constitution, the Central and State Legislatures have respectively exclusive powers to make laws with respect to any matters enumerated in Lists I, II and III in the Seventh Schedule. In the plenitude of that power, subject of course to certain constitutional limitations, the Parliament or State Legislatures would be within the ambit of their competence if they deem fit to legislate retrospectively.

Rule-making power conferred upon any other body or authority is a form of delegated legislation. We are not concerned here with those categories of rules which by reason of statutory provision have the same effect as if contained or enacted in the Act itself, in Maxwell''s Interpretation of Statutes, 10th Edn., p. 50 it is stated:

Instruments under an Act which prescribes that they shall be laid before Parliament for a prescribed number of days during which period they may be annulled by a resolution of either house, but if not so annulled they are to be of the same effect as if contained in the Act, and are to be judicially noticed, must be treated for all purposes of construction or obligation or otherwise, exactly as if they were in the Act.

Where rules are authorised to be framed for carrying out the purpose of the Act and are not by Legislature made part of the Act, the position becomes quite different. It has been held in Huzrat Syed Shah Mustarshid Ali Al Quadari Vs. Commr. of Wakfs and Others, at p. 440 (L):

In some Statutes power is given to frame rules and when so framed they are made part of the Statute. That is quite a different matter. In such a case, it might be permissible to supplement the provision of the Statute itself, within limits. But where rules are to be framed for "carrying out the purpose of the Act", such rules cannot travel beyond the four corners of the Act itself.

Section 21, General Clauses Act (10 of 1897) confers upon the rule-making authority power to add to, amend, vary or rescind rules. We have given anxious thought to the question under discussion. The learned advocate for the Petitioner has been unable to cite any authority to support his contention in regard to retrospectivity of the rule upon which he principally based his argument nor have we been able to have our hand upon one which may help us in the decision of this revision.

In our opinion, the rule-making authority does not possess plenary power to give the subordinate delegated legislation retrospective operation unless and until that power is expressly conferred by the parent enactment. In this view of the law, we are constrained to hold that the added Clause (b) to Sub-rule (3) of Rule 11E, Evacuee Interest (Separation) Rules, 1951 cannot operate retrospectively so as to affect pending proceeding.

The Rent Controller has not given an opportunity to the Petitioner to adduce evidence in support of his plea of his being a displaced person, and that factor afforded occasion to the advocate for the landlord to deny that fact. As we have come to the conclusion that the immunity provided by the added Sub-section cannot be availed of by the Petitioner, no importance can be attached to the contention that both the Courts below have been over-hasty in the disposal of the case.

However, we find that the Rent Controller and the lower appellate Court were considerate enough to give time to the Petitioner to vacate the disputed house. In the circumstances of this case and in view of the fact that the opposite party does not stand in immediate need of the house by reason of his transfer from Hyderabad, we are of the opinion that the ends of justice would be served if we also give time to the Petitioner for vacating the house. Accordingly, we fix 14-1-1956 on or before which he may vacate the premises in dispute.

With the above remarks, we dismiss the revision and make no order as to costs.