Shrimati Chander Wati vs Delhi Cloth And General Mills Ltd., and Others

H.R. Khanna, J.—This second appeal u/s 39 of the Delhi Rent Control Act, 1958 (Act No. 59 of 1958), hereinafter referred as the Act, filed by Shrimati Chander Wati is directed against the order of learned Rent Control Tribunal, Delhi, affirming on appeal the decision of the Controller and the main question which arises for determination in the appeal is whether the word "may" in sub-section (3) of section 9 of the Act means ''must'' or not. It arises in the following circumstances:

The appellant, Delhi Cloth and General Mills Limited respondent No. 1, is a tenant under the appellant in the premises in dispute bearing Municipal nos : 5511 to 5522, situated in Katra Moti, Nai Sarak, Delhi, on a monthly rent of Rs. 548/11/-. Respondents 2 to 9 are occupying some portions of the premises in dispute as sub-tenants under respondent No. 1 in accordance with the terms of the tenancy. The appellant filed the present application u/s 9 of the Act for fixation of the standard rent of the premises in dispute as also of the various individual portions which were in occupation of respondents 2 to 9.

Respondent No. 1 admitted the tenancy and the rate of rent. The right of the appellant to have the standard rent of the various portions in occupation of the sub-tenants was denied and it was averred that none of the respondents wanted the standard rent of those individual portions to be assessed. Similar written statements were filed on behalf of respondents 2 to 9. The Controller held that the standard rent of the premises in dispute would be fixed in these proceedings and that the appellant had no locus standi to have the standard rent of the individual portions in possession of the sub-tenants fixed. The appellant thereupon filed an appeal against that order of the Controller but the same was, as stated above, dismissed by the learned tribunal.

In second appeal Mr. Bhagwat Dayal, learned counsel for the appellant, has referred to the definition of the word ''tenant'' as given in clause (1) of section 2 of the Act which shows that the tenant includes a sub-tenant and has argued that in an application filed by the landlord u/s 9 of the Act for fixation of standard rent, the Controller is bound to fix not only the standard rent of the premises let out to the tenant but also of the portions which have been sublet to the sub-tenants. Sub-sections (1) to (3) of section 9 of the Act which have a bearing on the matter, read as under:

(1) The Controller shall, on an application made to him in this behalf, either by the landlord or by the tenant, in the prescribed manner, fix in respect of any premises,-

(1)

The standard rent referred to in section 6; or the increase, if any, referred to in section 7.

(2)

In fixing the standard rent of any premises or the lawful increase thereof the Controller shall fix an amount which appears to him to be reasonable having regard to the provisions of section 6 or section 7 and the circumstances of the case.

(3) In fixing the standard rent of any premises part of which has been lawfully sublet, the Controller may also fix the standard rent of the part sublet.

According to Mr. Bhagwat Dayal the word "may" used in sub-section (3) reproduced above means "must" and the Controller had no option but to fix the standard rent of the parts sublet in addition to fixing the standard rent of the entire premises which had been leased out to respondent No. 1. I have given the matter my consideration and am of the view that the above contention of Mr. Bhagwat Dayal cannot be accepted. It is no doubt true that the use of word "may" would not necessarily mean that a discretion is vested in an authority and that the matter is not to be decided by exclusive reference to the use of word "may" or "shall" in deciding as to what meaning should be bestowed on the word "may" or "shall". The context, in which those words are used, has to be borne in mind because it can give the best clue about the exact connotation of those words. As observed by their Lordships of the Supreme Court in State of U.P. Vs. Manbodhan Lal Srivastava,

the use of the word "shall" in a statute, though generally taken in a mandatory sense, does not necessarily mean that in every case it shall have that effect, that is to say, that unless the words of the statute are punctiliously followed, the proceeding or the outcome of the proceeding, would be invalid.

On the other hand, it is not always correct to say that where the word ''''may" has been used, the statute is only permissive or directory in the sense that non-compliance with those provisions will not render the proceeding invalid.

In a recent case Societe De Traction Et D''electricite Societe Anonyme Vs. Kamani Engineering Company Ltd., . It was observed:

It cannot be disputed that the use of the expression ''may'' is not decisive. Having regard to the context, the expression ''may'' used in a statute has varying significance. In some contexts it is purely permissive, in others, it may confer a power and make it obligatory upon the person invested with the power to exercise it as laid down.

Dealing with this aspect of the matter, it has been observed on page 231 of Maxwell book on Interpretation of Statutes, Eleventh Edition:

Statutes which authorise persons to do acts for the benefit of others, or, as it sometimes said, for the public good or the advancement of justice, have often given rise to controversy when conferring the authority in terms simply enabling and not mandatory. In enacting that they "think fit", or, "may" or "shall" if they think fit," or, "shall have power", or that "it shall be lawful" for them to do such acts, a statute appears to use the language of mere permission, but it has been so often decided as to have become an axiom that in such cases such expressions may have to say the least-a compulsory force, (Per cur., R. v. The Commrs (1850) 14 O. B. 474. Border R. D. C. v. Roberts (1950) I. K.B. 716 per Somervell J.) and so would seem to be modified by judicial exposition. On the other hand, in some cases, the authorised person, is invested with a discretion, and then these expressions seem divested of that compulsory force, and probably that is the prima facie meaning." Applying the above principles to the facts of the present case I find that the provisions of sub-section (3) of section 9 of the Act are meant essentially for the benefit of the sub-tenant or the tenant because it is only they who are interested in the fixation the standard rent of the portions of the premises which have been sublet. The landlord has no present interest in the fixation of the standard rent of the portions sublet because he is only concerned with the standard rent of the premises as a whole which had been let out to the tenant. So far as the tenant and sub-tenants in the present case are concerned, it is admitted that they have filed written statements stating that they do not want the standard rent of the individual portions in the occupation of the sub-tenants to be separately fixed. Apart from the above, I find that the legislature has used the word "shall" in sub-section (1) of section 9. Likewise, in sub-section (2) the word used is "shall". In the context of the above sub-sections the use of the word "may", of which the prima facie meaning, according to Maxwell, is to invest with a discretion and to divest of a compulsive force, in sub-section (3) clearly denotes that it has been used in the sense that a discretion vests in the Controller and he is not bound to fix the standard rent of the part sublet. The discretion of course has to be exercised not arbitrarily or capriciously but in a sound and judicious manner keeping in view the facts of the case. It cannot be said in the present case that the discretion has been exercised improperly because, as stated above, the tenant and the subtenants, who were the only persons interested in the fixation of the standard rent of the portions sublet, stated that they did not want fixation of the standard rent of those portions.

If has not been disputed before me that in case the word "may" indicates that a discretion is vested in the Controller whether to fix standard rent of the portion sublet or not, this Court cannot interfere with that discretion. Indeed this Court can interfere in second appeal u/s 39 of the Act only if it entails a substantial question of law. The manner of exercise of discretion on particular facts would not involve a substantial question of law especially when there is nothing to show that the exercise of the discretion was improper or perverse.

Mr. Bhagwat Dayal has also argued that the rent of individual portions of the premises in dispute should also be taken into account in determining, the standard rent of the entire premises in dispute. He has in this context referred to the following passage on page 292 of the Rent Acts by Megarry 1955 Edition:

If at the relevant date the premises were subject to both a tenancy and a sub-tenancy, the rent of the sub-tenancy will be preferred, for ''you must look at the occupying tenant and at the rent which he is paying rather than to the rent which is received by the landlord'': it is a fortiori if the rent under the tenancy is less than two-thirds of the ratable value. But if the sub-tenancy was ''unlawful'' (e.g., granted in breach of covenant) the rent of the tenancy will be taken, even though the tenant was not in occupation of the premises.

The above argument, in my opinion, does not arise at this stage of the case and would have only to be gone into at the time of fixing the standard rent of the premises in dispute which matter is still pending before the Controller. Reference has also been made by Mr. Bhagwat Dayal to Glossop and another v. Ashley 1922 (1) K.B. 1, as well as Dhanrajgirji Narsingirji Vs. W.G. Ward, , Both these cases relate to the criterion which is to be adopted when the standard rent of the portion which has been sublet is to be fixed and have no bearing on the point which arises for determination in the present appeal.

The appeal, accordingly, fails and is dismissed, but, in the circumstances of the case, I leave the parties to bear their own costs.