Ritz Hotels (Hyderabad) Limited and Others vs State of Andhra Pradesh and Others

Syed Shah Mohammed Quadri, J.—The first petitioner in these two Writ Petitions is M/s. Ritz Hotels (Hyderabad) Limited (for short ''the Ritz''). The facts giving rise to these petitions are common, so they are heard together and are being disposed of by a common judgment.

M/s. Ritz Hotel (Private) Limited, Hyderabad, predecessor in interest of the petitioner, obtained on lease from the erstwhile Government of Hyderabad the premises called ''Hill Fort Palace'' situate at Hyderabad for a period of five years on a monthly rent of Rs. 1,000/- on January 1,1955. After the expiry of the lease of five years, renewal of lease for a further period of ten years on a monthly rent of Rs. 2,171/- was agreed to by the Government of Andhra Pradesh, the first respondent, and a lease deed was accordingly executed between the parties. During the said period the first petitioner(the Ritz) came into being and as the successor-lessee entered into a supplementary lease agreement with the first respondent on February 14, 1974 and took over all the rights and liabilities under the then in force lease deed dated July 5, 1967. Pursuant to the renewal clause in the said lease deed, the petitioner was entitled to have the lease renewed for a period of 15 years from September 30, 1981 but that was not accepted by the first respondent, so the petitioner filed a suit in O.S. No. 1032 of 1981 on the file of the Additional Chief Judge-cum-II Additional Metropolitan Sessions Judge, Hyderabad for specific performance of the renewal clause in the lease deed dated July 5, 1967. That suit was decreed on March 23, 1983 directing the first respondent to renew the lease for a further period of 15 years. Aggrieved by the judgment and decree of the trial Court, the first respondent filed C.C.C.A. No. 194 of 1983 in this Court, which was dismissed by Judgment dated October 13, 1987. Consequently the first respondent issued G.O.Ms. No. 56, T.R.& B (B.II) Department, dated February 15, 1988 agreeing to renew the lease subject to certain conditions for 15 years from October 1, 1981 and directed the Chief Engineer to enter into a new lease deed; the quantum of rent payable by the first petitioner was fixed by G.O.Ms. No. 594, dated September 20, 1988 and on May 29, 1989 a lease deed was entered into between the first petitioner and the first respondent.

While so purporting to exercise the powers u/s 3 of the Andhra Pradesh Government Lands and Buildings (Termination of Leases) Act, 1986 (for short ''the Act''), the first respondent issued notice of termination of the said lease of the first petitioner on August 21, 1989 with effect from March 31, 1990. Challenging the validity of the said notice as also the constitutional validity of the Act the petitioners filed Writ Petition No. 4228 of 1990.

During the pendency of the said Writ Petition stay of eviction of the premises was granted by this Court and the lease period came to an end on September 30, 1996. However, on September 9, 1996 the first respondent issued another notice directing the first petitioner to vacate the premises on or before September 30, 1996 and intimating that in the event of failure to vacate the said premises action will be initiated against it u/s 5 of the Act for taking possession of the Hill Fort Palace. Questioning the correctness of the said notice and seeking a direction to the respondents to extend the lease for a period of 50 years from October 1,1996 Petitioner No. 1 and another filed Writ Petition No. 20220 of 1996.

The Deputy Secretary to the Government of Andhra Pradesh, the first respondent, filed counter affidavit in Writ Petition No. 4228 of 1990 not disputing the material facts. However, it is stated that in G.O.Ms. No. 594, dated September 29, 1988 orders were issued fixing the rent of Rs. 38,000/- per month from October 1, 1981 for a period of five years, which was to be increased by 15% at the interval of every five years till September 30, 1996; the first petitioner was granted three years time for payment of arrears of rent. After strong persuasion of the matter the first petitioner executed lease deed dated May 29, 1989, which was also registered. With effect from 1-10-1991 to 30-9-1996 the rent payable was Rs. 50,225/- per month. As the building was required, the first respondent decided to evict the first petitioner and accordingly a notice was issued u/s 3 of the Act, Letter No. 3058/ B-IKD/81-91, dated August 21, 1989, asking the first petitioner to vacate the leased premises before March 31, 1990. The first petitioner filed a revision requesting the Government to withdraw the notice. The first respondent supported the validity of the impugned notice on various grounds meeting the contentions raised by the first petitioner. We shall refer to those contentions as well as the pleas of the first respondent when we deal with the submissions of the learned Counsel for the petitioners.

In the counter affidavit filed in Writ Petition No. 20220 of 1996, the Secretary to Government, Transport, Roads and Buildings Department, Government of Andhra Pradesh, states that as the period of lease was expiring on September 30, 1996 and the building was required for public purpose, the first petitioner was requested by notice No. 707/B.II/96-30, dated September 9, 1996 to vacate the Hill Fort Palace. It is further stated that the first petitioner in letter dated March 6, 1996 expressed a desire to run the Ritz Hotel as Heritage Hotel and while setting out various stipulations sought renewal of lease. Among others the proposed stipulations included the period of lease as 50 years with a request that the rent should be fixed reasonably so as not to impose further financial burden on it. It was offered that if permitted, additional rooms would be constructed without disturbing the basic character of the existing building and that a conference hall with modern communication aids, in keeping with international standards, would also be provided. The Government considered the proposal of a Heritage Hotel but decided to give an opportunity of setting up such a hotel to all concerned in the field. Accordingly the first petitioner was requested to vacate the premises on September 30, 1996.

Sri K.G. Kannabiran, the learned senior counsel appearing for the petitioners, contends that the impugned termination notice dated August 21, 1989 is not in accordance with Section 3 of the Act - firstly because it is not authenticated in the name of the Governor of the State of Andhra Pradesh and secondly because the exercise of power under the Act which had come into force on July 25, 1986 is mala fide, on the ground that the legitimate expectation of the first petitioner created by the action of the respondents has been abruptly put an end to.

The learned Additional Advocate General has argued that the authentication of the impugned notice in the name of the Governor is a mere formality and that improper authentication of a decision taken by the appropriate authority will not render the decision illegal; and that as the decision to terminate the lease has been taken under the Business Rules of the Government by the competent authority, the fact that it is not expressed in the name of the Governor of Andhra Pradesh will not make the notice of termination illegal. The learned Additional Advocate General has pleaded that the exercise of power to terminate the lease under the Act was for public purpose and that action cannot be treated as a mala fide action; the question of legitimate expectation would arise when there is some semblance of right and as no right was created in the first petitioner which could give rise to any legitimate expectation, the notice cannot be said to be illegal on those grounds.

Now we shall examine these contentions.

To consider the validity of the impugned notice of termination, it will be useful to set out Section 3 of the Act here.

"3. Termination of lease:-Notwithstanding anything contained in the Indian Contract Act, 1872 and the Transfer of Property Act, 1882, it shall be lawful for the Government to terminate any lease or other arrangements entered into or made before or after the appointed date between the Government and any person, in respect of any demised premises, where any such demised premises is required for a public purpose, after giving such period of notice and in such manner as may be prescribed to such person and thereupon the rights and liabilities as between the parties to the lease or other arrangement shall cease and determine; but any amount due to the Government from the aforesaid person under the lease or other arrangement so terminated shall be recovered as an arrear of land revenue."

A plain reading of the provision, extracted above, shows that it commences with a non obstante clause, applies to leases or other arrangements entered into between the Government and any person before or after the appointed date and enables the Government to terminate any lease or arrangement between the Government and any person by issuing a notice, as prescribed, to such a person which would bring about the termination of rights and liabilities between the parties to the lease and to recover the rent due by such a person as arrears of land revenue. Consequently it bars the lessee of the Government from claiming any right under the Indian Contract Act, 1872 and the Transfer of Property Act, 1882 in regard to an action taken under the said provision.

We may also note here the provisions of Sections 4 and 5 of the Act. Section 4 directs that a person to whom a notice u/s 3 of the Act is issued, shall vacate the premises within such time as may be prescribed, not exceeding 180 days, and deliver possession thereof to the Estate Officer in case of a building and to the Mandal Revenue Officer in case of land. Section 5 provides that where the person in occupation of the building, the lease of which is terminated u/s 3 of the Act, fails or refuses to vacate and deliver possession u/s 4 of the Act, the Estate Officer or the Mandal Revenue Officer, as the case may be, has to serve an order of eviction in the prescribed manner on the person in occupation of such premises or his agent to vacate and deliver possession of the premises within the time specified in the order. In the event of failure to vacate the premises and deliver possession, the Estate Officer or the Mandal Revenue Officer, as the case may be, is empowered to take possession from the person in occupation thereof and if he is resisted in the exercise of such power or discharge of such duty then on such officer giving requisition, the Magistrate having jurisdiction is required to direct any police officer, not below the rank of Sub-Inspector, to render such help as may be necessary to enable the officer to exercise such power or discharge duty. Where such premises is locked, he may break open the lock or seal the premises in taking possession.

Rules 3 and 6 of the Rules made under the Act are relevant for our purpose. Rule 3 prescribes that notice in Form-A be issued u/s 3 of the Act; Rule 6 provides the procedure for taking possession of the public premises.

Now reverting to Section 3 of the Act, it is pertinent to point out that the authority to terminate lease is the Government. Clause (c) to subsection (60) of Section 3 of the General Clauses Act, 1897 defines the expression ''State Government'' thus: as respects to anything done or to be done after the commencement of the Constitution (Seventh Amendment) Act, 1956, the ''State Government'' shall mean, the ''Governor'' and in the Union Territory the ''Central Government''. Article 166 of the Constitution of India deals with the conduct of business of the State Government. It reads as follows :

"166. Conduct of business of the Government of a State:-

(1) All executive action of the Government of a State shall be expressed to be taken in the name of the Governor.

(2) Orders and other instruments made and executed in the name of the Governor shall be authenticated in such manner as may be specified in rules to be made by the Governor and the validity of an order or instrument which is so authenticated shall not be called in question on the ground that it is not an order or instrument made or executed by the Governor.

(3) The Governor shall make rules for the more convenient transaction of the business of the Government of the State and for the allocation among Ministers of the said business in so far as it is not business with respect to which the Governor is by or under this Constitution required to act in his direction."

Clause (1) of the said Article, extracted above, enjoins that all executive action of the Government of a State shall be expressed to be taken in the name of the Governor. Clause (2) says that orders and other instruments made and executed in the name of the Governor shall be authenticated in such manner as may be specified in rules to be made by the Governor and the validity of any order or instrument which is so authenticated, shall not be called in question on the ground that it is not an order or instrument made or executed by the Governor. Clause (3) provides for making of Business rules of the Government of the State by the Governor.

In exercise of Clause (3) of Article 166 of the Constitution the Governor of the State of Andhra Pradesh framed Business rules and instructions of the Andhra Pradesh Government. It is apt to refer to Rules 10, 12 and 13 of the Rules, which read as follows :

"10. Without prejudice to the provisions of Rule 7, the Minister in charge of a department shall be primarily responsible for the disposal of the business pertaining to that department:

Provided that nothing in this rule shall apply to any business which the Speaker of the Legislative Assembly is competent to dispose of under the Rules of Procedure and Conduct of Business in the Andhra Pradesh Legislative Assembly.

xx xx xx xx

All orders or instruments made or executed by or on behalf of the Government of the State shall be expressed to be made or executed in the name of the Governor.

Every order or instrument of the Government of the State shall be signed either by a Secretary, a second Secretary, a Special Secretary, an Additional Secretary, a Joint Secretary, a Draftsman, a Deputy Secretary an Under Secretary or an Assistant Secretary to the Government of the State or such other officer as may be specifically empowered in that behalf and such signature shall be deemed to be the proper authentication of such order or instrument."

Rule 10, inter alia, says that the Minister in charge of the department shall be primarily responsible for the disposal of the business pertaining to that department. Rule 12 merely reiterates the requirement of Clause (3) of Article 166 of the Constitution. Rule 13 enjoins that every order or instrument of the State shall be signed by a Secretary, a second Secretary, a Special Secretary, an Additional Secretary, a Joint Secretary, a Draftsman, a Deputy Secretary, an Under-Secretary or an Assistant Secretary to the Government of the State or such other officer as may be specifically empowered in that behalf and such signature shall be deemed to be the proper authentication of such order or instrument.

A combined reading of Rules 10, 12 and 13 would show that though in the conduct of business of the Government of the State the Minister in charge of a department is under an obligation for the disposal of the business appertaining to that department, all the orders made by him have to be expressed as made in the name of the Governor and every order or instrument of the Government of the State has to be signed either by a Secretary, a second Secretary, a Special Secretary, an Additional Secretary, a Joint Secretary, a Draftsman, a Deputy Secretary, an Under-Secretary or an Assistant Secretary to the Government of the State or such other officer as may be specifically empowered in that behalf and such signature shall be deemed to be the proper authentication of such order or instrument.

The principle underlying Article 166 of the Constitution of India has been elucidated by the Supreme Court in State of Rajasthan and Another Vs. Sripal Jain, In that case one of the contentions urged before the Supreme Court was that under the service Rules the order of compulsory retirement which was to be made by the Government, was made by the Inspector General of Police and that as the order does not satisfy the requirement of Article 166 of the Constitution of India, there is no order in law. Having noticed that the order in that case was not in the form required under Article 166 of the Constitution of India, Justice Wanchoo for the Constitution Bench observed:

".....It is well settled that any defect of form in the order by Government would not necessarily make it illegal and the only consequence of the order not being in proper form as required by Article 166 is that the burden is thrown on the Government to show that the order was in fact passed by it."

On a perusal of the record in that case the Supreme Court opined that the recommendation of High Power Committee was approved by the Home Minister and the Chief Minister and the order of compulsory retirement was thus passed by the Government of Rajasthan.

Keeping the above principles in mind we shall examine the impugned notice in this case which reads as follows:

GOVERNMENT OF ANDHRA PRADESH TRANSPORT, ROADS AND BUILDINGS (BID DEPARTMENT.

No. 3058/B.IKP/81-91 Dated: 21-8-1989 From Sri H.K.Babu, IAS, Addl. Secretary to Government, Transport, Roads & Buildings Department, A.P. Secretariat, Hyderabad - 500 022.

To

M/s. Ritz Hotel (Private) Limited, Saifabad, Hyderabad. NOTICE

The Government premises, called Hill Fort Palace, situate at Saifabad, Hyderabad, has been leased to your Organisation on a monthly rent as specified below :

Period Rent payable per month. Rs. From 1-10-1981 to 30-9-1986 38,000/- From 1-10-1986 to 30-9-1991 43,700/- From 1-10-1991 to 30-9-1996 50,255/ The lease period according to subsequent lease deed entered into on 29th May, 1989 expires by 30th September, 1996.

The said premises are required by the Government for a public purpose, namely to locate the Guest House. Hence, the lease for the remaining period of lease is hereby terminated with effect on and from the 30th September, 1989 u/s 3 of Andhra Pradesh Government Lands and Buildings (Termination of Leases) Act, 1986 (Act 18 of 1986).

As the said premises are required by the Government for a public purpose, you are hereby directed to vacate the said premises on or before the 31st March, 1990 and hand over the possession of the said premises to the Executive Engineer (R&B), Central Buildings Division, Hyderabad.

Take notice that in case you fail to vacate the said premises on or before the 31st March, 1990 further action will be initiated against you as per the provisions contained in Section 5 of the said Act.

Yours faithfully. Sd/- xx xx, (H.K. BABU) Addl. Secretary to Government."

From a perusal of the notice, extracted above, two aspects are very clear - (i) the action terminating the lease is couched in passive voice and it is not clear whether the Government terminated the lease; and (ii) the order is not in the form contemplated by Article 166 of the Constitution. This position will place on the respondents the burden of showing that the impugned order was passed by the Government. To discharge that burden the learned Additional Advocate-General had placed before us the original file relating to issuance of the impugned notice. We have perused the record. We have noticed that even before issuance of notice u/s 3 of the Act, the Minister, Roads & Buildings and the Chief Minister had taken a policy decision that the lease of petitioner No. 1 in respect of the Hill Fort Palace should be terminated by exercising the power u/s 3 of the Act. Again when the note was put up with regard to the termination of lease under the said, provision all the authorities including the Minister concerned and the Chief Minister took decision for termination of lease of the petitioner. Further it is evident that the Additional Secretary to Government has authenticated the impugned notice; therefore the impugned notice is in conformity with Rule 13 of the Business Rules.

With regard to the form of the order it is equally evident that the impugned notice is not in the required form as contemplated under Clause (3) of Article 166 of the Constitution and Rule 12 of the Business Rules but in view of the judgment of the Supreme Court in State of Rajas than v. Sripal Jain (supra), that by itself will not render the impugned notice illegal.

Now we take up the other contentions. Sri Kannabiran argues that the third respondent executed a fresh lease deed pursuant to the judgment of this Court in C.C.C.A. No. 194 of 1983, dated October 13, 1987 but the first respondent terminated the same by the impugned notice and thus abruptly put to an end to the legitimate expectation created by the actions of the respondents, so the impugned termination is mala fide and illegal. The actions of the respondents which created legitimate expectations, according to the learned counsel are - renewal of the lease deed for a period of 15 years with effect from 1-10-1981 by orders issued in G.O.Ms. No. 56, dated February 15, 1988 calling upon the petitioner to pay necessary amounts to the registering authorities for execution of the lease deed granting a lease and issuing order in G.O.Ms. No. 594, dated September 29, 1986 enhancing monthly rent with effect from October 1, 1981.

It may be apt to note here the doctrine of legitimate expectation spelt out by the Supreme Court in U.P Awas Evam Vikas Parishad Vs. Gyan Devi (Dead) by L.Rs. and another, etc. etc., thus :

"......In situations where even though a person has no enforceable right yet he is affected or likely to be affected by the order passed by a public authority the Courts have evolved the principle of legitimate expectation. The expression which is said to have originated from the judgment of Lord Denning in Schmidt v. Secretary of State for Home Affairs (1969) 2 Ch 149) is now well established in public law. In Attorney General of Hong Kong v. Yuen Shiu (1983) AC 629 Privy Council applied this principle where expectations were, ''based upon some statement or undertaking by or on behalf of, the public authority'', and observed, ''Accordingly "legitimate expectations" in this context are capable of including expectations which go beyond enforceable legal rights, provided they have some reasonable basis''. A person may have a legitimate expectation of being treated in a certain way by an administrative authority even though he has no legal right in private law to receive such treatment'' (Halsbury''s Laws of England Vol. I (1) 4th Edn. Re-issue Para 81). Fair procedure and just treatment is the core of our jurisprudence. No one should suffer for omission in law or technicalities in rules. Therefore when the law permits the local body to lead evidence then it is implicit in it that the local authority can legitimately expect to be informed or intimated of the proceedings. It would be in consequence with principle of fairness. Otherwise the right to lead evidence shall hang on the oft chance of the authority having come to know of the proceedings."

In Union of India and others Vs. Hindustan Development Corpn. and others, the Supreme Court explained the principle as follows :

"...... For legal purposes, the expectation cannot be the same as anticipation. It is different from a wish, a desire or a hope nor can it amount to a claim or demand on the ground of a right. However, earnest and sincere a wish, a desire or a hope may be and however confidently one may look to them to be fulfilled, they by themselves cannot amount to an assertable expectation and a mere disappointment does not attract legal consequences. A pious hope even leading to a moral obligation cannot amount to a legitimate expectation. The legitimacy of an expectation can be inferred only if it is found on the sanction of law or custom or an estahed (sic. established) procedure followed in regular and natural sequence. Again it is distinguishable from a genuine expectation. Such expectation should be justifiably legitimate and protectable. Every such legitimate expectation does not by itself fructify into a right in the conventional sense.

The concept of legitimate expectation in administrative law has now, undoubtedly, gained sufficient importance. It is stated that "Legitimate expectation" is the latest recruit to a long list of concepts fashioned by the Courts for the review of administrative action and this creation takes its place beside such principles as the rules of natural justice, unreasonableness, the fiduciary duty of local authorities and "in future, perhaps, the principle of proportionality."

The Supreme Court laid down one of the limitations of the principle in the following words :

".....The doctrine does not give scope to claim relief straightway from the administrative authorities as no crystallized right as such is involved. The protection of such legitimate expectation does not require the fulfillment of the expectation where an overriding public interest requires otherwise. In other words where a person''s legitimate expectation is not fulfilled by taking a particular decision then decision maker should justify the denial of such expectation by showing some overriding public interest."

In Ghaziabad Development Authority and State of U.P. Vs. Delhi Auto and General Finance Pvt. Ltd. and Maha Maya General Finance Co. Ltd. and another, referring to its decision in Food Corporation of India Vs. M/s. Kamdhenu Cattle Feed Industries, , the Supreme Court observed :

"It was clearly indicated in that decision that non-consideration of legitimate expectation of a person adversely affected by a decision may invalidate the decision on ''he ground of arbitrariness even though the legitimate expectation of that person is not enforceable right to provide the foundation for challenge of the decision on that basis alone. In other words, the plea of legitimate expectation relates to procedural fairness in decision making and forms a part of the rule of non-arbitrariness; and it is not meant to confer an independent right enforceable by itself."

It was further observed:

"It is clear that the requirements of public interest can outweigh the legitimate expectation of private persons and the decision of a public body on that basis is not assailable."

Thus it is clear that the doctrine of legitimate expectation can be called in aid for the purposes of procedural fairness. Where there has been procedural irregularity the decision can be questioned but the doctrine per se does not clothe any person with a right legally enforceable in a Court of law. Further the legitimate expectation of private persons can always be defeated by requirements of public interest.

In so far as the question of mala fide exercise of power u/s 3 of the Act is concerned, there can be no dispute about the principle which has been established by a catena of decisions of the English Courts as well as the Indian Courts. In S. Pratap Singh Vs. The State of Punjab, referring to the decision of the English Court in Municipal Council of Sydney v. Campbell (1925 AC 338), it is observed:

"The only question which could be considered by the Court is whether the authority vested with the power has paid attention to or taken into account circumstances, events or ''matters wholly extraneous to the purpose for which the power was vested, or whether the proceedings have been initiated mala fide for satisfying a private or personal grudge of the authority against the officer. If the act is in excess of the power granted or is an abuse or misuse of power the matter is capable of interference and rectification by the Court."

Though, perhaps, it is open to an individual to exercise his statutory right arbitrarily or capriciously, in the spane of private law, say, under a contract and make himself liable for the consequence without getting his action invalidated like termination of a contract making himself liable for damages maintaining the termination but for a public authority such a course is not open as his actions have to conform to the test of reasonableness and bona fide.

The mere fact that the Act came into force with effect from 25-7-1986 and in spite of that the Government have chosen to renew the lease by executing the lease deed dated 29-5-1989 would not lead to the inference that the action of termination of the lease by the impugned notice dated August 21, 1989 is a mala fide action. In so far as the execution of lease deed is concerned, it has been done pursuant to and in obedience of the decree of this Court in the appeal confirming the judgment and decree of the trial Court. For the reason that the execution of the lease deed has been in obedience of the decree passed by the Court, it cannot be contended that the Government''s action of terminating the lease in exercise of its powers conferred by Section 3 of the Act will be mala fide. The judgment and decree of this Court in the civil appeal obliged the Government to execute the lease deed but this did not preclude the Government from exercising its statutory power of terminating the lease bona fide for a public purpose.

In view of the above discussion we do not find any force in the first contention of the learned Counsel for the petitioners.

It is next contended that the termination of lease was not for a public purpose. This argument is built on the premise that in the impugned notice the termination is said to be for a public purpose; indeed Section 3 of the Act authorises the termination of a lease only for public purpose. The avowed public purpose for which the Government chose to take delivery of possession of the demised premises-Hill Fort Palace-was for making it a Government Guest House, as the Government did not have sufficient Guest Houses in Hyderabad to cater to its needs. This, Sri Kannabiran submits, is not consistent with the plea taken by the Government in the second writ petition.

In the counter affidavit filed in W.P. No. 20220 of 1996 it is stated, inter alia, that for purposes of establishing Heritage Hotel in the demised premises the Government thought it fit to notify the same to the public and invite bids from all interested persons instead of granting long lease of 50 years in favour of the petitioners. This plea, no doubt, indicates a shift in the public purpose. Establishing a Heritage Hotel by Tourism Department for the sake of tourism cannot but be regarded as a public purpose. If that be so, the mere change in the public purpose would not, in our view, amount to negation of the public purpose.

The learned Counsel has also submitted that by the impugned action the right of the petitioner to carry on its business is affected and therefore it would be violative of Article 19(1)(g) of the Constitution as the impugned action cannot be brought under Clause (6) of Article 19 of the Constitution. We are afraid, we cannot accede to the contention of the learned Counsel for the petitioners because, in our view, there is no Fundamental Right in the petitioners to carry on the business in the Government premises by claiming extension of lease. In this view of the matter we are not inclined to further elaborate this aspect.

Lastly it is submitted that Section 3 of the Act is violative of Article 14 of the Constitution of India firstly because there is no reasonable classification and secondly because it vests arbitrary power in the State to terminate the leases of Government buildings. The principle embodied in Article 14, namely, equality before law, does prohibit class legislation but classification is permissible provided it satisfies two conditions, viz., (i) it 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) the differentia must have a rational relation to the object sought to be achieved by the statute in question. There can be no doubt that Section 3 classifies leases of the buildings into two classes (a) the buildings owned by private persons; and (b) the buildings owned by the State. The object sought to be achieved by Section 3 of the Act is to enable the Government to terminate the lease of the Government buildings for any public purpose and to recover the possession of the Government buildings expeditiously to fulfill the public purpose. It is evident that the classification of the buildings has nexus to the object which the Act seeks to achieve. It is a known fact that in case of termination of tenancy under the provisions of the Transfer of Property Act, the ''land-lord'', whether a private person or the State, has to approach a competent Civil Court for recovery of possession which consumes lot of time which frustrates the public purpose for which the tenancy is terminated and possession is sought to be recovered. Therefore, the termination of tenancy by the State for public purpose in case of Government building and providing machinery for the recovery of possession on termination of lease, which seeks to achieve the object of the Act cannot be said to be unreasonable and discriminatory as such violative of Article 14 of the Constitution.

In so far as the contention relating to conferring upon the Government arbitrary power u/s 3 of the Act is concerned, We find it difficult to accede to the contention because the power u/s 3 of the Act is conferred on the highest authority, the Government; further the power can be exercised only for a public purpose. There is, therefore, no arbitrariness. That apart it has now been laid down in a recent judgment of the Supreme Court in State of Andhra Pradesh and others, etc. Vs. McDowell and Co. and others, etc., that arbitrariness cannot be a ground to strike down the law enacted by the legislature. The Supreme Court held:

"The power of Parliament or for that matter, the State Legislatures is restricted in two ways. A law made by Parliament or the legislature can be struck down by Courts on the two grounds and two grounds alone, viz., (1) lack of legislative competence, and (2) violation of any of the Fundamental Rights guaranteed in Part III of the Constitution or of any other constitutional provision. There is no third ground. So by whatever name it is characterized, the ground of invalidation must fall within the four corners of these two grounds. If an enactment is challenged as violative of Article 14, it can be struck down only if it is found that it is violative of the equality clause/equal protection clause enshrined therein. Similarly, if an enactment is challenged as violative of any of the Fundamental Rights guaranteed by Clauses (a) to (g) of Article 19(1), it can be struck down only if it is found not saved by any of the Clauses (2) to (6) of Article 19 and so on. No enactment can be struck down by just saying that it is arbitrary or unreasonable. ''Arbitrariness'' is an expression used widely and rather indiscriminately - an expression of inherently imprecise import. Hence some or the other constitutional infirmity has to be found before invalidating an Act. An enactment cannot be struck down on the ground that the Court thinks- it unjustified. Parliament and the legislatures, composed as they are of the representatives of the people, are supposed to know and be aware of the needs of the people and what is good and bad for them. The Court cannot sit in judgment over their wisdom".

In regard to W.P. No. 20220 of 1996 the learned Additional Advocate General submits, the impugned notice therein is merely a reminder and that pursuing of the action pursuant to that notice depends upon the validity or invalidity of the impugned notice dated 21-8-1989 and that the purported action u/s 5 of the Act can be taken only under the provisions of Section 3 of the Act. Therefore no arguments have been advanced in that Writ Petition.

It may also be noted here that the total period of lease of 15 years in favour of the first petitioner has already expired and there is no renewal clause in the lease, which is conceded by the learned Counsel for the petitioners.

For the above reasons, we do not find any illegality in the impugned notice u/s 3 of the Act on August 21, 1989. There are no merits in the Writ Petitions. They are accordingly dismissed, but, in the circumstances, without costs.

Time is granted to the petitioners till the end of February, 1997 for vacating the premises; the petitioners shall hand over the possession of the premises to the Estate Officer on or before 28-2-1997. In default, it would be open to the respondents to evict the petitioners u/s 5 of the Act.